Unassociated Document
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 o
Check
the
appropriate box:
o
Preliminary
Proxy Statement o Confidential,
for
Use of the
Commission
Only (as permitted by Rule 14a-6(e)(2))
x
Definitive
Proxy
Statement o Definitive
Additional Materials
o Soliciting
Material Pursuant
to
ss.240.14a-11(c) or
ss.240.14a-12
CENTER
BANCORP, INC.
(Name
of
Registrant as Specified in Its Charter)
(Name
of
Person(s) Filing Proxy Statement, if other than the Registrant)
Payment
of Filing Fee (Check the appropriate box):
o
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:
(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:
| o |
Fee
paid previously with preliminary
materials.
|
| o |
Check
box if any part of the fee is offset as provided by Exchange Act Rule0-11(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:
CENTER
BANCORP, INC.
Corporate
Headquarters
2455
Morris Avenue
Union,
New Jersey 07083
(908)
688-9500
NOTICE
OF ANNUAL MEETING OF SHAREHOLDERS
TO
BE HELD MAY 27,
2008
To
Our
Shareholders:
The
Annual Meeting of Shareholders of Center Bancorp, Inc. ("Center Bancorp") will
be held at the Park
Avenue Club, 184 Park Avenue, Florham Park, New Jersey on Tuesday, May 27,
2008,
at 10:00 a.m.,
for
the following purposes:
1.
To
elect three Class 3 directors, whose terms will expire in 2009 if the
shareholders of Center Bancorp approve a proposal to amend Center Bancorp's
Certificate of Incorporation in the manner described below, or in 2011 if the
shareholders do not approve such proposal.
2.
To
approve an amendment to Center Bancorp's Certificate of Incorporation to
eliminate the classified board.
3.
To
transact such other business as may properly come before the Annual Meeting.
Only
shareholders of record of Center Bancorp at the close of business on April
15,
2008
shall be entitled to notice of and to vote at the Annual Meeting. Each share
of
Center Bancorp's Common Stock is entitled to one vote.
Please
complete, sign, date and return the accompanying proxy in the enclosed postage
paid envelope at your earliest convenience.
You
are
cordially invited to attend the Meeting.
By
Order
of the Board of Directors
| |
Anthony
C. Weagley
|
| |
President
and CEO
|
Dated:
April 28, 2008
CENTER
BANCORP, INC.
2455
Morris Avenue, Union, New Jersey 07083
PROXY
STATEMENT
We
are
providing this proxy statement to you in connection with the solicitation by
our
Board of Directors of proxies to be used at our annual meeting of shareholders
to be held at the Park
Avenue Club, 184 Park Avenue, Florham Park, New Jersey at 10:00 a.m. on Tuesday,
May 27, 2008, and
any
adjournments of that meeting. We are first sending copies of this proxy
statement and the enclosed proxy card to our shareholders on or about April
29,
2008.
Unless we indicate otherwise, all references to “we”, us” and “our” and other
similar terms are references to Center Bancorp, Inc.
Only
shareholders of record at the close of business on April 15,
2008, a
date which we refer to as the record date, will receive notice of our annual
meeting and will be entitled to vote at our annual meeting. For each matter
that
is presented to our shareholders at our annual meeting, you will be entitled
to
one vote for each share of our common stock that you own on the record date.
On
the record date, there were 13,113,760 shares of our common stock
outstanding.
In
a
Schedule 13G filing made on February 14, 2008, Private Capital Management,
L.P
stated that it beneficially owns a total of 735,788 shares of Common Stock
(5.61% of the shares outstanding as of the record date). Private Capital
Management, L.P. has an address of 8889 Pelican Bay Boulevard, Suite 500,
Naples, Florida 34108.
In
a
joint Schedule 13D filing made on November 26, 2007, on behalf of Seidman and
Associates, LLC, Seidman Investment Partnership, LP., Seidman Investment
Partnership II, LP, Broad Park Investors, LLC, Chewy Gooey Cookies, LP,
Berggruen Holdings North America Ltd., LSBK06-08, LLC, Lawrence Seidman, Dennis
Pollack, Harold Schechter, Raymond Vanaria and LSBK06-08, L.L.C., such persons
stated that as of November 19, 2007, they beneficially owned a total of
1,359,069 shares of our common stock, representing 10.36% of the shares
outstanding as of the record date. Seidman and Associates, L.L.C., Seidman
Investment Partnership, L.P., Seidman Investment Partnership II, L.P. and
Lawrence Seidman have an address of 100 Misty Lane, Parsippany, New Jersey
07054. Mr. Seidman also has an address of 19 Veteri Place, Wayne, New Jersey
07470. Broad Park Investors, L.L.C. and Chewy Gooey Cookies, L.P. have an
address of 80 Main Street, West Orange, New Jersey 07052. Berggruen Holdings
North America Ltd. has an address of 1114 Avenue of the Americas, Forty First
Floor, New York, New York 10036. Mr. Pollack has an address of 825 Third Avenue,
New York, New York 10022. Mr. Schechter has an address listed in the Schedule
13D filing as 34 33rd
Street,
New York, New York 10001. Mr. Vanaria has an address of 155 North Dean Street,
Englewood, New Jersey 07631.
We
are
not aware of any other person or entity that owned of record or beneficially
more than five percent of our outstanding common stock as of the record date.
If
you
execute a proxy card, you may revoke your proxy at any time before it is
exercised by either:
| |
·
|
submitting
a later dated signed proxy before the annual meeting is conducted;
or
|
| |
·
|
filing
a written notice of revocation with our corporate Secretary either
prior
to the annual meeting or while the annual meeting is in progress
but prior
to the voting of your proxy: or
|
| |
·
|
submitting
a written ballot at the annual meeting.
|
All
proxy
cards that are properly executed and not revoked will be voted as specified
in
the proxy card.
Center
Bancorp will bear the cost of soliciting proxies. In addition to our soliciting
proxies by use of the mails, our officers and employees or officers or employees
of our bank subsidiary may solicit proxies by telephone, telegraph or personal
interview, with nominal expense to us. We will also pay the standard charges
and
expenses of brokerage houses or other nominees or fiduciaries for forwarding
proxy soliciting material to the beneficial owners of shares.
If
holders of a majority of the outstanding shares of our common stock are present
in person or by proxy, we will have a quorum, which means that we will be able
to transact business at the annual meeting. The election of directors will
require the affirmative vote of a plurality of the common stock represented
and
entitled to vote at the annual meeting. In other words, the three persons who
receive the highest number of votes will be deemed elected to our Board. The
proposal to approve an amendment to our Certificate of Incorporation will
require the affirmative vote of a majority of the votes cast at the annual
meeting by shareholders represented and entitled to vote at the annual meeting.
If any other matters are submitted to shareholders at the annual meeting, such
matters will be deemed “approved” if they receive the affirmative vote of a
majority of the votes cast at the annual meeting by shareholders represented
and
entitled to vote at the annual meeting. For purposes of determining the votes
cast with respect to any matter presented for consideration at the annual
meeting, we will only count those votes which are cast "for" or "against".
We
will count abstentions and broker non-votes solely for the purpose of
determining whether a quorum is present at the annual meeting.
Election
of Directors
Our
By-Laws provide that our Board will consist of not less than five nor more
than
twenty-five members. The exact number of directors is fixed and determined
from
time to time by resolution of the full Board or by resolution of the
shareholders at any annual or special meeting. Our Board has set the number
of
Directors, effective as of the 2008 Annual Meeting, at 11. Our Certificate
of
Incorporation presently states that our directors will be divided into three
classes, as nearly equal in number as possible, with each class elected on
a
staggered term basis, normally for a period of three years. Shorter terms are
permitted when necessary in order to equalize the size of the classes. At the
upcoming annual meeting, three directors in Class 3 will be elected for a three
year term to end in 2011. However, if our shareholders approve the proposed
amendment to our Certificate of Incorporation, the directors in Class 3 elected
at our meeting will be elected for one year terms Regardless of how our
shareholders vote with respect to the proposed amendment to our Certificate
of
Incorporation, the terms of the directors in Class 1 and Class 2 will continue
until 2010 and 2009, respectively. However,
the directors in Class 1 have advised us that if the shareholders approve the
proposed amendment, they will resign prior to next year’s annual meeting (and
presumably stand for re-election), so that the entire Board would be up for
election at next year’s annual meeting.
Since
the
adoption of the Sarbanes-Oxley Act in July 2002, there has been a growing public
and regulatory focus on the independence of directors. In response, Nasdaq
adopted amendments to its definition of independence. Additional requirements
relating to independence are imposed by the Sarbanes-Oxley Act with respect
to
members of the Audit Committee. As noted below, our Board has determined that
the members of the Audit Committee satisfy all applicable definitions of
independence. Our Board has also determined that the following members of our
Board (including all members of our Nominating and Compensation Committees)
satisfy the Nasdaq definition of independence: Hugo Barth III, Alexander A.
Bol,
Brenda Curtis, John J. DeLaney, Jr., James J. Kennedy, Howard Kent, Elliot
I.
Kramer, Paul Lomakin, Jr. (whose term of office will expire at the Annual
Meeting), Harold Schechter, Herbert Schiller (whose term of office will expire
at the Annual Meeting), Lawrence B. Seidman, William A. Thompson and Raymond
Vanaria.
It
is
intended that the proxy cards solicited by our Board will be voted FOR
(unless
otherwise directed) the election of our Board’s nominees —
James
J. Kennedy, Howard Kent, and Elliot I. Kramer —
to the
Board of Directors. Center Bancorp does not contemplate that any nominee will
be
unable to serve as a director for any reason. Each of our Board’s nominees has
agreed to serve if elected. However, in the event that one or more of our
Board’s nominees should be unable to stand for election, discretionary authority
is reserved to cast votes for the election of a substitute or substitutes
selected by our Board of Directors and all proxies eligible to be voted for
our
Board's nominees will be voted for such other person or persons. Each of the
nominees is currently a member of the Board of Directors of Center Bancorp
and
our subsidiary, Union Center National Bank (the "Bank"). Paul Lomakin and
Herbert Schiller, each a longstanding member of our Board and a director in
Class III, have advised us that they will decline to stand for re-election
at
the Annual Meeting.
The
following directors have not served in his or her current occupation for at
least the past five years:
| |
·
|
Hugo
Barth retired in 2003. Previously, he was a partner in the firm of
Haeberle & Barth (funeral directors).
|
| |
·
|
Brenda
Curtis also retired in 2003. She served as the Regional Vice President
of
the Eastern Division of the American Cancer Society from September
2002
until her retirement in August 2003. From June 1999 until September
2002,
she served as the Regional Director of the American Cancer Society.
From
1982 through 1999, Ms. Curtis was the Executive Director of the Union
County (N.J.) branch of the American Cancer Society.
|
| |
·
|
James
J. Kennedy became the Managing Partner of KV Solar, LLC, an
energy-conservation design and installation firm, during 2006. Mr.
Kennedy
served as the Managing Partner of KV1 Asset Management, a hedge fund
management company, from 1998 to 2005. Previously he was Senior Managing
Director for Fuji Capital Markets Corporation, a derivatives-trading
company, from 1990 to 1997, and was earlier a Vice-President & Trading
Manager at Chemical Bank from 1984 to 1990.
|
| |
·
|
Elliot
I. Kramer has been a partner in the law firm of Fox Rothschild LLP
since
July 2007, when his prior law firm, Goldman & Kramer, merged with Fox
Rothschild LLP. Mr. Kramer was a partner with Goldman & Kramer for
more than five years prior to that
merger.
|
| |
·
|
Harold
Schechter has been Vice President and Chief Financial Officer of
Global
Design Concepts, Inc., a mid-size importer and distributor of accessories
and handbags, since 2005. From September 2004, to January 2005, Mr.
Schechter was the Chief Financial Officer of Diamond Chemical Inc.,
a
national manufacturer of housekeeping and industrial products. Mr.
Schechter served as Vice President, Chief Operating Officer and Chief
Financial Officer of Creative Salon Products, an importer and distributor
of beauty products, from January 2003 to October 2004, and as Vice
President, Chief Operating Officer and Chief Financial Officer of
William
H. Ranney Associates Inc., which was also an importer and distributor
of
beauty products, from May 2001 to December 2002. For more than five
years
prior thereto, Mr. Schechter was the Executive Vice President, Chief
Operating Officer and Chief Financial Officer of Verdi Travelware
Ltd./Monarch Luggage, a mid-sized importer and distributor of luggage,
accessories and bags. Mr. Schechter has been a Certified Public Accountant
since 1977. Mr. Schechter is a member of the Board of Directors of
Jacklyn
Inc.
|
| |
·
|
Lawrence
B. Seidman has been the manager of various investment vehicles,
principally involved in the purchase and sale of publicly traded
bank and
thrift stocks, for more than the past 25 years. From November 1991
to
December 31, 2005, he was also a consultant, President and General
Counsel
to Menlo Acquisition Corporation, a holding company for an environmental
consulting and remediation company and a laboratory
company.
|
| |
·
|
William
A. Thompson has been employed by Uni-Select USA (auto parts distributor)
as a General Manager since April 2007. For more than five years before
joining Uni-Select USA, he was the Vice President of Thompson & Co.
(auto parts distributor).
|
As
of
February 29, 2008, our directors, according to information supplied by them,
owned beneficially, directly or indirectly, the number of shares of our common
stock set forth opposite their respective names below. All shares were held
directly unless otherwise stated. Our directors have served continuously as
such
since the dates when they first became directors as set forth herein. The date
appearing in parentheses opposite each director's name in the "Director Since"
column below represents the year in which such director became a director of
Union Center National Bank, our wholly owned subsidiary. Each director presently
serves as a director of both Union Center National Bank and Center Bancorp.
CLASS
3 -
We have set forth below certain information with respect to each director in
Class 3 (each of whom has been nominated for a three year term if the
shareholders do not approve the proposed amendment to our Certificate of
Incorporation eliminating our classified board structure or a one year term
if
the shareholders approve the proposed amendment). Herbert Schiller, who is
not
standing for re-election, beneficially owned 59,530 shares of our Common Stock
(0.45% of the outstanding shares) as of February 29, 2008. Paul Lomakin Jr.,
who
also is not standing for re-election, beneficially owned 157,711
shares
of our Common Stock (1.20%
of the
outstanding shares) as of February 29, 2008.
|
Name
|
|
Occupation
|
|
Age
|
|
Director
Since
|
|
Shares of
Common Stock
Held
Beneficially
Directly and
Indirectly
|
|
Percent of
Outstanding
Shares
|
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
Howard
Kent
|
|
Principal,
Real Estate Equities Group, LLC (real estate investment and
management
business)
|
|
60
|
|
2008
(2008)
|
|
26,250(a)
|
|
0.20
|
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
James
J. Kennedy
|
|
Managing
Partner, KV Solar, LLC (energy conservation design and installation
firm)
(2006-Present). See text above regarding prior years.
|
|
52
|
|
2000
(2000)
|
|
64,807
|
|
0.49
|
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
Elliot
I. Kramer
|
|
Partner,
Fox Rothschild LLP (law firm) (July 2007-Present). See text
above
regarding prior years.
|
|
56
|
|
2008
(2008)
|
|
1,000
|
|
0.01
|
|
______________
|
(a)
|
|
|
Direct
|
|
|
3,150
|
|
|
|
|
|
Indirect
|
|
|
23,100 (Joint)
|
|
CLASS
- 1
We have set forth below certain information with respect to each director in
Class 1 (each of whom has a term that will continue until 2010 in the absence
of
a resignation and is not subject to election at the upcoming annual
meeting).
|
Name
|
|
Occupation
|
|
Age
|
|
Director
Since
|
|
Number of
Shares of
Common Stock
Held
Beneficially
Directly and
Indirectly
|
|
Percent of
Outstanding
Shares
|
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
Brenda
Curtis
|
|
Retired
in 2003; see text above regarding prior years
|
|
66
|
|
1995
(1995)
|
|
56,581
|
|
0.43
|
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
Harold
Schechter
|
|
Vice
President and Chief Financial Officer of Global Design Concepts,
Inc.
(importer and distributor of accessories and handbags) (2005-Present).
See
text above regarding prior years.
|
|
63
|
|
2007
(2007)
|
|
2,010(a)
|
|
0.02
|
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
Lawrence
B. Seidman
|
|
Manager
of investment vehicles. See text above regarding prior
years.
|
|
60
|
|
2007
(2007)
|
|
1,359,069(a)
|
|
10.18
|
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
Raymond
Vanaria
|
|
Partner,
Malesardi, Quackenbush, Swift & Company, LLC (accounting
firm)
|
|
49
|
|
2007
(2007)
|
|
7,507(a)
|
|
0.06
|
|
_______________
(a)
See
the description above regarding the 13D filing made by Mr. Seidman and others.
The shares reflected in the table above for Mr. Schechter and Mr. Vanaria do
not
include any shares other than shares directly owned by them. The shares
reflected in the table above for Mr. Seidman reflect all shares covered by
the
13D filing.
CLASS
2 -
We have set forth below certain information with respect to each director in
Class 2 (each of whom has a term that will continue until 2009 and is not
subject to election at the upcoming annual meeting).
|
Name
|
|
Occupation
|
|
Age
|
|
Director
Since
|
|
Number
of
Shares
of
Common
Stock
Held
Beneficially
Directly
and
Indirectly
|
|
Percent
of Outstanding Shares
|
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
Hugo
Barth, III
|
|
Retired
in 2003; see text above regarding prior years
|
|
65
|
|
1982
(1977)
|
|
111,988(a)
|
|
0.85
|
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
Alexander
A. Bol
|
|
Owner,
Alexander A. Bol A.I.A. (architectural firm); Chairman of
the Board of the
Corporation and the Bank (2001-Present)
|
|
60
|
|
1994
(1994)
|
|
76,446
|
|
0.58
|
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
John
J. DeLaney, Jr.
|
|
Partner,
Lindabury, McCormick,Estabrook & Cooper, P.C.(successor to Cooper Rose
& English, LLP) (law firm); Mayor of Morristown, New Jersey
(1998-2005)
|
|
53
|
|
2006
|
|
3,920
|
|
0.03
|
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
William
A. Thompson
|
|
General
Manager, Uniselect USA (auto parts distributor); see text
above regarding
prior years
|
|
50
|
|
1994
(1994)
|
|
64,671(b)
|
|
0.49
|
|
_______________
|
(a)
Direct
|
|
55,897
|
|
Indirect
|
|
51,006
(wife and jointly with wife)
|
| |
|
|
|
(b)
Direct
|
|
53,435 |
|
Indirect
|
|
11,236
(wife and children)
|
The
shares set forth in the tables above include the following number of shares
subject to options exercisable by April 29, 2008: Mr. Barth, 5,085 shares;
Mr.
Bol, 868 shares; Ms. Curtis, 5,085 shares; Mr. DeLaney, 0 shares; Mr. Kennedy,
44,975 shares; Mr. Lomakin, 5,085 shares; Mr. Kent, 0 shares; Mr. Kramer, 0
shares; Mr. Schechter, 0 shares; Mr. Schiller, 5,085 shares; Mr. Seidman, 0
shares; Mr. Thompson, 5,085 shares; and Mr. Vanaria, 0 shares.
John
J.
Davis, our former president and chief executive officer, beneficially owned
0
shares of our common stock as of February 29, 2008. Anthony C. Weagley, our
current president and chief executive officer, beneficially owned 28,521 shares
of our common stock as of February 29, 2008, including 19,363 shares subject
to
options exercisable by April 29, 2008. Lori A. Wunder, one of our vice
presidents, beneficially owned 14,865 shares of our common stock as of February
29, 2008, including 11,150 shares subject to options exercisable by April 29,
2008. John F. McGowan, one of our vice presidents until January 30, 2008,
beneficially owned 0 shares of our common stock as of February 29, 2008,
including 0 shares subject to options exercisable by April 29, 2008. Christopher
Gorey, also one of our vice presidents, beneficially owned 5,037 shares of
our
common stock as of February 29, 2008, including 2,014 shares subject to options
exercisable by April 29, 2008. As of February 29, 2008, the total number of
shares of our common stock directly and beneficially owned by all of our
directors and executive officers (21 persons) amounted to 2,050,897 shares
or
15.6% of the common shares outstanding. In addition, as of February 29, 2008,
the total number of shares of our common stock directly and beneficially owned
by officers of Union Center National Bank (and not Center Bancorp) amounted
to
23,617 shares or 0.18% of the common shares outstanding. Information provided
with respect to Messrs. Davis and McGowan are provided to the best of our
knowledge, as neither of those individuals are currently employed by, or
otherwise associated with, Center Bancorp.
There
is
no family relationship, by blood, marriage or adoption, between any of the
foregoing Directors and any other officer, director or employee of Center
Bancorp or Union Center National Bank.
Our
Board’s Compensation Committee consists of Alexander A. Bol (Chairman), Hugo
Barth III, Brenda Curtis, John J. DeLaney, Jr., Lawrence B. Seidman and William
A. Thompson. The Compensation Committee is charged with recommending to our
full
Board the compensation of the chief executive officer and the compensation
of
all of our other officers. The chief executive officer does not participate
in
deliberations regarding his own compensation, but does participate in
deliberations regarding the compensation of the other officers. The Compensation
Committee also administers our equity compensation plans, other than plans
intended solely for the benefit of non-employee directors.
Our
Board's Audit Committee consists of Raymond Vanaria (Chairman), James J.
Kennedy, Elliot I. Kramer, Harold Schechter and William Thompson. The Audit
Committee has been established by our Board of Directors for the purpose of
overseeing the accounting and financial reporting processes of Center Bancorp
and audits of our financial statements and has responsibility for monitoring
our
financial reporting systems, reviewing our financial statements, hiring and
discharging our independent accountants and supervising the relationship between
Center Bancorp and our independent accountants.
Our
Board’s Nominating Committee consists of Alexander A. Bol (Chairman), Hugo
Barth, III, Brenda Curtis, John J. DeLaney, Jr., James J. Kennedy, Howard Kent,
Elliot Kramer, Paul Lomakin, Harold Schechter, Herbert Schiller, Lawrence
Seidman, William A. Thompson and Raymond Vanaria. For additional information
regarding the Nominating Committee, see "Nominating Committee Matters".
Our
Board’s Executive Committee consists of Alexander A. Bol (Chairman), Hugo Barth,
III, Brenda Curtis, John J. DeLaney, Jr., James J. Kennedy, Howard Kent, Elliot
Kramer, Paul Lomakin, Harold Schechter, Herbert Schiller, Lawrence Seidman,
William A. Thompson and Raymond Vanaria. The Executive Committee generally
performs the functions of the full Board for determinations requiring the vote
solely of independent directors.
During
2007, the Compensation Committee met nine
times, the Audit Committee met five times, the Nominating Committee met two
times, the Executive Committee met two times and our Board of Directors met
nineteen times. All directors attended at least 75% of the Board and committee
meetings that they were required to attend.
EXECUTIVE
COMPENSATION
Compensation
Disclosure and Analysis
General
As
part
of the SEC’s revised executive compensation disclosure package, the SEC requires
that issuers provide a “Compensation Disclosure and Analysis” in which issuers
explain the material elements of their compensation of executive officers by
describing the following:
| |
·
|
the
objectives of the issuer’s compensation
programs;
|
| |
·
|
the
conduct that the compensation programs are designed to
reward;
|
| |
·
|
the
elements of the compensation
program;
|
| |
·
|
the
rationale for each of the elements of the compensation
program;
|
| |
·
|
how
the issuer determines the amount (and, where applicable, the formula)
for
each element of the compensation program;
and
|
| |
·
|
how
each element and the issuer’s decisions regarding that element fit into
the issuer’s overall compensation objectives and affect decisions
regarding other elements of the compensation
program
|
Our
compensation philosophy is dictated by the Compensation Committee of our Board
of Directors. The duties and responsibilities of the Compensation Committee,
which consists entirely of independent directors of the Board, are to:
|
|
· |
oversee
the investments of our 401(k) plan and qualified pension
plan;
|
|
|
· |
provide
guidance regarding the design of our employee benefit
plans;
|
| |
·
|
establish
the compensation of our chief executive officer, subject to the terms
of
his employment agreement;
|
| |
·
|
with
input from our chief executive officer, establish or recommend to
our
Board the compensation of our other executive officers, subject to
the
terms of any existing employment agreements;
and
|
|
|
· |
monitor
our overall compensation policies and employee benefit
plans.
|
Historically,
our chief executive officer and our senior vice president and director of human
resources, have participated in determinations regarding the compensation and
design of our benefit programs for all employees, but did not participate in
setting their own compensation. On August 23, 2007, John J. Davis retired from
his position as president and chief executive officer and on August
24, 2007
Charles
E. Nunn, Jr. resigned from his position as senior vice president and director
of
human resources. Anthony C. Weagley, in his capacity first as our acting
president, and then as our president, has
participated in compensation meetings since assuming the responsibilities of
president of Center Bancorp.
Our
Compensation
Objectives
and the Focus of Our Compensation Rewards
We
believe that an appropriate compensation program should draw a balance between
providing rewards to executive officers while at the same time effectively
controlling compensation costs. We reward executive officers in order to attract
highly qualified individuals, to retain those individuals in a highly
competitive marketplace for executive talent and to incent them to perform
in a
manner that maximizes our corporate performance. Accordingly, we have sought
to
structure our executive compensation with a focus on pay-for-performance. We
seek to offer executive compensation programs that align each individual’s
financial incentives with our strategic direction and corporate values.
We
view
executive compensation as having three key elements:
|
|
· |
a
current cash compensation program consisting of salary and cash bonus
incentives;
|
|
|
· |
long-term
equity incentives reflected in grants of stock options and/or restricted
stock; and
|
|
|
· |
other
executive retirement benefits and perquisites.
|
These
programs aim to provide our executives with an overall compensation package
that
is competitive with comparable financial institutions, and aligns individual
performance with our long-term business objectives.
We
annually review our mix of short term performance incentives versus longer
term
incentives, and incorporate in our compensation reviews the data from studies
performed as to appropriate competitive levels of compensation and benefits.
We
do not have set percentages of short term versus long term incentives. Instead,
we look to provide a reasonable balance of those incentives.
We
also
periodically “benchmark” our compensation programs to industry available
databases and to a peer group. The process has involved hiring independent
compensation consulting firms to perform studies that employ the following
processes:
| |
·
|
Gathering
data from industry specific global and regional compensation databases
based upon company size for each executive position.
|
| |
·
|
Determining
an appropriate peer group of financial institutions based upon similar
size and geography.
|
| |
·
|
Developing
data points for salary and total cash compensation comparisons and
equity
opportunities.
|
| |
·
|
Averaging
peer group and database statistics together to produce a relevant
“market”
at the data points for salary, total cash compensation and equity
and
comparing our positions to the “market” data.
|
| |
·
|
Evaluating
other compensation components, including executive benefits as compared
to
competitive standards.
|
| |
·
|
Comparing
our compensation levels to the “market” and determining our relative
positioning for competitiveness as to salary, total cash compensation
and
non-cash compensation.
|
We
did
not engage in any benchmarking analyses during 2007.
In
2005,
the IFM Group, an independent compensation consulting firm, was retained to
benchmark our executive officer stock grants utilizing a peer group of six
other
financial institutions ranging in asset size from $900 million to $2.1 billion
dollars. The peer group averaged $1.36 billion in assets versus our size at
the
time of approximately $1.0 billion in assets. The six financial institutions
that comprised the peer group were Lakeland Bancorp, Ocean First Financial,
Interchange Financial Services Corp, Greater Community Bancorp,
Peapack-Gladstone Financial Corp and Synergy Financial Group. Each peer group
financial institution was also selected because of its geographic proximity
to
us. The results of that study indicated that our option grants were below the
peer group average of grants provided to the five highest paid executives and
that the excercisable/unexcercisable value of the in-the-money options held
by
our five highest paid officers was below market.
In
2005
and 2006, Clark Consulting, another independent compensation consulting firm,
also performed benchmarking studies with respect to our cash and equity
compensation at the executive officer level. We retained Clark
Consulting to assist in providing market assessments of officer pay as well
as
establishing peer group criteria for us.
The
salary, total cash and equity compensation of our executive officers were
compared to corresponding data points of the peer group.
Although
we gain considerable knowledge about the competitiveness of our compensation
programs through the benchmarking process and by conducting periodic studies,
we
recognize that each financial institution is unique and that significant
differences between institutions in regard to executive compensation practices
exist. We believe that the combination of executive compensation programs that
we provide fulfill our objectives of providing a competitive level of
compensation and benefits in order to attract and retain key executives. We
also
believe that our incentive programs appropriately reward performance to achieve
profitability and growth while at the same time allowing us to maintain controls
over our compensation costs.
Our
policy for allocating between long-term and currently paid compensation is
to
ensure adequate base compensation to attract and retain personnel, while
providing incentives to maximize long-term value for our company and our
shareholders. Likewise, we provide cash compensation in the form of base salary
to meet competitive salary norms and reward good performance on an annual basis
in the form of bonus compensation to reward superior performance against
specific short-term goals. We provide non-cash compensation to reward superior
performance against specific objectives and long-term strategic goals. Our
compensation package for 2007 for the executive officers named in the summary
compensation table below ranged, as a percentage of total compensation, from
11%
to
73%
in cash
compensation and 89%
to
27%
in
non-cash compensation, including benefits and equity-related awards.
Specific
Elements of Our Compensation Program
We
have
described below the specific elements of our compensation program for executive
officers.
Salary.
While
consolidation continues within the banking industry, and recent experience
continues to demonstrate that there remains a limited supply of qualified
experienced executives, we believe that it is important that we retain a
competitive salary structure in order to retain the existing qualified officers
and maintain a base pay structure consistent with the structures utilized for
the compensation of similarly situated executives in the industry and at
similarly size institutions. We maintain salary guidelines for our executive
officers as part of a structured salary pay scale that is reviewed periodically
based upon industry standards developed through studies by independent
compensation consulting firms engaged by our Compensation Committee for that
purpose. We believe that a key objective of our salary structure is to maintain
reasonable “fixed” compensation costs by targeting base salaries at a
competitive average, taking into effect performance as well as
seniority.
The
officers named in our summary compensation table below - referred to in this
proxy statement as our “Named Officers” - who continue to serve as executive
officers of Center Bancorp each are parties to employment agreements that
establish base salary levels. From year-to-year, the Named Officers’ salary
levels may be increased, but may not be decreased, under these employment
agreements. Other executive officers are employed at will but have a change
in
control agreement that provides for additional compensation in the event of
certain business combinations.
Short-Term Incentive
Compensation.
We
maintain an Annual Incentive Plan, which we refer to as our “AIP”. Our AIP is
designed to motivate the plan participants and to correlate total cash
compensation to performance in a manner designed to provide meaningful
incentives for executive officers in general and to provide competitive levels
of total cash compensation. Under the terms of the AIP, our officers are
eligible to receive incentive pay for performance. For our former chief
executive officer, John J. Davis, performance goals related solely to the
performance of Center Bancorp and our subsidiaries. Our
new
chief executive officer, Anthony C. Weagley, will be evaluated in a similar
manner. For
all
other participants, goals relate both to individual performance and overall
corporate performance. Individual performance goals vary by officer job function
and are adjusted each year based upon our tactical and strategic objectives.
The
extent to which we achieve our corporate goals, and profitability as compared
to
budget, are factors considered in the corporate performance portion of our
AIP.
The
targeted incentive performance levels under our AIP are established after
consideration of industry practices and norms gathered from our periodic
benchmarking studies. For 2007, targeted awards as a percentage of salary
were:
for the chief executive officer: 30%, senior vice presidents: 20%, vice
presidents: 15%, and assistant vice presidents and assistant cashiers: 10%.
Based upon actual performance, up to 140% of the targeted award percentage
may
be achieved. An individual must have at least a satisfactory performance
appraisal in order to be eligible for an incentive award. Because our 2007
financial results were not at projected 2007 plan levels, a determination
was
made by our Board not to pay any incentive bonuses under our AIP in 2007,
nor to
issue any equity awards for 2007 results.
Long-Term
Incentive Compensation.
We
provide long-term incentives to the Named Officers through our stock incentive
plans. Throughout 2007, our Named Officers were eligible to participate in
our
1999 Employee Stock Incentive Plan. We refer to that plan as our “1999 Stock
Plan”. From time to time, the Compensation Committee has granted stock options
and/or restricted stock awards to our executive officers. Stock options have
been granted at an exercise price equal to the then current market price of
the
Common Stock. Options and restricted stock awards under the Stock Plan are
granted on an ad
hoc
basis
taking into account financial performance and results. Options were last granted
in 2005 to executive officers (other than Mr. Davis), while restricted stock
grants were awarded to Mr. Davis in 2001, 2002, 2003 and 2005. As a result
of a benchmarking study performed in September 2005 by IFM Group indicating
that
equity holdings by our executives were well below peer banks, IFM Group
recommended that fully-vested options be granted at that time to our chief
executive officer and other senior executives to bring their equity incentives
closer to that of our peers. Acting on that recommendation, fully vested options
were granted in October 2005 to Mr. Davis and our senior executive officers.
No
options were granted in 2006 or 2007.
In
2006,
our Board established the Center Bank Open Market Share Purchase Incentive
Plan,
which we refer to as the “PIP”. We established the PIP in order to encourage
ownership and retention of our Common Stock by our executive officers. Under
the
PIP, any executive officer who applies up to 50% of his or her cash bonus to
the
purchase of our Common Stock in the open market will receive an additional
cash
amount to cover the Federal, State or local income taxes on the portion of
the
bonus used to make these purchases. To be eligible for the bonus, the purchased
shares must be held by the executive officer for at least 30 days. Since no
cash
bonuses were paid to the Named Officers during 2006 or 2007, no cash payments
were made pursuant to the PIP in 2006 or 2007.
Other
Elements of Compensation for Executive Officers.
In order
to attract and retain qualified executives, we provide executives with a variety
of benefits and perquisites, consisting primarily of retirement benefits through
our 401(k) and defined benefit pension plans, executive life insurance,
long-term care insurance and automobiles. Details of the values of these
benefits and perquisites may be found in the footnotes and narratives to the
Summary Compensation Table. In addition, we maintain a supplemental savings
plan
that allows participating executives to receive “matching” contributions that
would have been provided by our 401(k) plan if not for certain IRS limits on
the
amounts that they may otherwise earn under our 401(k) Plan and a deferred
compensation plan under which we may, but are not required to, credit deferred
compensation accounts of participants from time to time based on the participant
performance and the operating profit of Center Bancorp and our subsidiaries.
We
also maintained a supplemental pension plan for Mr. Davis to replace the pension
benefits that he would have earned under our qualified pension plan if not
for
certain IRS limitations. We have not afforded that benefit to any other
executive officer. Details about the deferred compensation plan and supplemental
401(k) and pension benefits can be found in the narratives accompanying the
Pension Benefits Table and the Nonqualified Deferred Compensation Table in
this
proxy statement.
Employment
Agreements
As
noted
above, for many years we have had employment agreements with Mr.
Davis
and with
several of our executive officers, including Anthony C. Weagley, Lori A. Wunder
and John
F.
McGowan.
Jack
Davis’ agreement, which together with the employment agreements for certain
other senior vice presidents are described in further detail elsewhere in this
proxy statement, contained
renewal provisions that, in effect, assured Mr. Davis of at least three years'
notice of termination in the absence of a "Change in Control Event" (defined
as
the acquisition by a third party of a majority of the voting stock or
substantially all of the assets of Center Bancorp or Union Center National
Bank
or a change in the composition of our Board of Directors such that a majority
of
the members of the Board as of the date of the agreement no longer serve on
the
Board) and five years' notice of termination in connection with a Change in
Control Event. Under
Mr.
Davis' employment agreement in effect prior to the amendments described below,
if Mr. Davis’ employment had been involuntarily terminated without cause, or if
he were to have resigned for “good reason” within 180 days after a material
adverse change in his duties or title, a material breach of the employment
agreement by us, or a Change in Control Event, then he would have been entitled
to a lump sum payment of the salary, bonus and benefits that he would have
earned for the balance of the term.
In
2004,
our Compensation Committee concluded that it would be appropriate, on a periodic
basis, to evaluate the renewal status of the employment agreements of our senior
executive officers. In performing that analysis, and mindful of the expanded
executive compensation disclosure requirements implemented by the SEC during
2006, our Compensation Committee undertook a thorough review of Mr. Davis’
employment agreement and the employment agreements of our senior vice presidents
during the fourth quarter of 2006 and the first quarter of 2007. IFM Group
and
Clark Consulting advised our Compensation Committee that the five year renewal
period triggered under Mr. Davis’ employment agreement in the event of a Change
in Control Event was a longer period than the periods utilized in change in
control arrangements for most financial institutions. Acting on information
from
IFM Group and Clark Consulting that change in control severance and benefits
that are based on a three times multiple is common for financial institutions,
the Compensation Committee sought, and Mr. Davis agreed, to change his
employment agreement to reduce the multiplier for purposes of determining his
severance and benefits triggered by a termination of employment following a
Change in Control Event from five to three. In connection with that change,
our
Compensation Committee accepted Mr. Davis’ request to change the term of his
agreement to a fixed period ending on December 31, 2012, as opposed to a term
that automatically extends each year. In recommending the extension of the
term
of Mr. Davis’ employment agreement until December 31, 2012 to our Board, the
Compensation Committee noted that the severance amounts and benefits that would
be payable to Mr. Davis if his employment were terminated earlier would still
be
based on a multiple of three (as was already the case under Mr. Davis’
employment agreement) even if there were more than three years remaining in
the
term of his agreement at the time of his termination.
Under
Mr.
Davis' prior agreement, we estimate that he would have been entitled (taking
into account “gross-up payments) to an amount in excess of $3.6 million had he
terminated employment during 2006 in connection with a Change in Control Event.
As detailed elsewhere herein, payments actually made to Mr. Davis upon
termination of his employment in 2007 amounted to $1,575,995.
In
addition, under Mr. Davis' prior employment agreement, a significant portion
of
the payments that would have been made to Mr. Davis as a result of a Change
in
Control Event would have been non-deductible to us for federal income tax
purposes. Had Mr. Davis' employment terminated during 2006 in connection with
a
Change in Control Event, we estimate that the value of this lost tax deduction
would have amounted to more than $1.0 million dollars
In
connection with the review of, and resulting changes to, Mr. Davis’ employment
agreement, our Compensation Committee also approved an extension of the term
of
each of the employment agreements with Mr.
Weagley, Ms. Wunder and Mr.
McGowan through December 31, 2009, subject to renewal on the same terms as
previously provided by their employment agreements. Although the terms of these
agreements were extended until December 31, 2009, the multiple for determining
the amount of severance and benefits that the executive would be entitled to
receive in the event of a termination without cause or a resignation for “good
reason” was limited by our Compensation Committee to two, even if termination of
the executive’s employment occurs when there is more than two years remaining in
the term. If, however, the executive’s employment is terminated or he or she
resigns for “good reason” following a Change in Control Event, then the multiple
for determining severance pay and benefits will be three (as was previously
provided by the employment agreements). We made similar changes in employment
agreements for two other executive officers who are not Named
Officers.
In
2008,
we further amended Mr. Weagley's employment agreement. Mr. Weagley's new
employment agreement revises the compensation structure upon termination of
employment and eliminates a gross-up provision which could have added
substantial expense in the event that the payment of benefits upon termination
were to involve so-called "excess parachute payments".
Our
Compensation Committee has expressed an intention not to enter into formal
employment agreements with newly hired or promoted senior vice presidents.
Instead, the Compensation Committee has expressed a desire to enter into change
in control agreements with new senior vice presidents. Such agreements generally
provide for enhanced compensation in the event that a change in control occurs
while the applicable executive officer is employed by Center
Bancorp.
In
March
2008, our Board designated Richard Abrahamian as our new Chief Financial
Officer. Acting on the recommendation of our Compensation Committee, in March
2008 our Board of Directors authorized us to enter into a change in control
agreement with Mr. Abrahamian.
Compliance
with Sections 162(m) and 409A of the Internal Revenue Code
Section
162(m) of the Internal Revenue
Code denies a deduction to any publicly held corporation for compensation paid
to certain “covered employees” in a taxable year to the extent that compensation
exceeds $1,000,000 for a covered employee. Certain performance-based
compensation that has been approved by our shareholders is not subject to this
limitation. As a result, stock options granted under our 1999 Stock Plan are
not
subject to the limitations of Section 162(m). However, restricted stock awards
under our 1999 Stock Plan generally will not be treated as performance-based
compensation. Restricted stock award grants made to date under the 1999 Stock
Plan have not been at levels that, together with other compensation, approached
the $1,000,000 limit. Also, since we retain discretion over bonuses under the
AIP, those bonuses also will not qualify for the exemption for performance-based
compensation. The Compensation Committee intends to provide executive
compensation in a manner that will be fully deductible for federal income tax
purposes, so long as that objective is consistent with overall business and
compensation objectives. However, we reserve the right to use our judgment
to
authorize compensation payments that do not comply with the exemptions in
Section 162(m) when we believe that such payments are appropriate and in
the best interests of our shareholders, after taking into consideration changing
business conditions or the executive officer’s performance.
It
is
also our intention to maintain our executive compensation arrangements in
conformity with the requirements of Section 409A of the Internal Revenue Code,
which imposes certain restrictions on deferred compensation arrangements. We
have been engaged in a process of reviewing and modifying our deferred
compensation arrangements since the enactment of Section 409A in 2004 in order
to remain compliant with guidance issued by the Internal Revenue Service under
Section 409A.
Summary
of Cash and Certain Other Compensation
The
following table sets forth, for the years ended December 31, 2006 and 2007,
a
summary of the compensation earned by John J. Davis, Anthony C. Weagley, and
our
three other most highly compensated executive officers who were employed by
Center Bancorp as of December 31, 2007. Mr. Davis served as our chief executive
officer during 2006 and from January 1, 2007 through August 23, 2007. Mr.
Weagley served as our chief financial officer throughout 2006 and 2007 and
as
our chief executive officer from August 23, 2007 throughout the balance of
2007.
We refer to the executive officers named in this table as the “Named Officers”,
we refer to Center Bancorp as “Center” and we refer to Union Center National
Bank as “UCNB”
SUMMARY
COMPENSATION TABLE
|
Name and
Principal
Position
(a)
|
|
Year
|
|
Salary
($)
(b)
|
|
Change in
Pension Value
and Nonqualified
Deferred
Compensation
Earnings
($)
(c)
|
|
All Other
Compensation
($)
(d)
|
|
Total
($)
(e)
|
|
|
John
J. Davis,
President
and Chief Executive
Officer of
Center and UCNB (Mr. Davis retired on August 23, 2007)
|
|
|
2007
2006
|
|
|
240,400
360,600
|
|
|
252,631
276,342
|
|
|
1,618,541
68,268
|
|
|
2,111,572
705,210
|
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Anthony
C. Weagley
Vice
President and Treasurer
of Center and Sr. Vice President
and
Cashier
of UCNB (Mr. Weagley also served as president and chief executive
officer
from August 23, 2007 through the balance of the calendar
year)
|
|
|
2007
2006
|
|
|
195,312
187,500
|
|
|
16,089
25,875
|
|
|
30,495
32,636
|
|
|
241,896
246,011
|
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Lori
A. Wunder
Vice
President of Center and Senior
Vice President
of UCNB
|
|
|
2007
2006
|
|
|
125,000
125,000
|
|
|
15,674
15,808
|
|
|
30,540
32,502
|
|
|
171,214
173,310
|
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
John
F. McGowan
Vice
President of Center and Senior
Vice President
of UCNB (a)
|
|
|
2007
2006
|
|
|
116,000
116,000
|
|
|
32,910
45,238
|
|
|
37,442
40,181
|
|
|
186,352
201,419
|
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Christopher
Gorey,
Vice
President of Center and Senior
Vice President
of UCNB (b)
|
|
|
2007
2006
|
|
|
110,000
90,000
|
|
|
17,441
19,647
|
|
|
34,180
9,809
|
|
|
161,621
119,456
|
|
(a)
Mr.
McGowan's employment with Center Bancorp and Union Center National Bank
terminated on January 30, 2008.
(b)
Mr.
Gorey joined Center Bancorp and Union Center National Bank on July 27,1998
and
first became an executive officer on September 1, 2006.
For
us,
2007 and 2006 were difficult years. Our net interest margin was adversely
impacted by the interest rate environment that prevailed throughout 2006 and
2007. Accordingly, we did not pay bonuses to any of the Named Officers for
performance during 2006 or 2007 and we did not grant stock awards or stock
options to any of the Named Officers during 2006 or 2007. Furthermore, the
Named
Officers did not receive any compensation from non-equity incentive plans with
respect to performance during 2006 or 2007. Bonuses which were paid during
2006
for 2005 performance and which were included in our compensation table two
years
ago are not included in the table above.
In
the
table above:
| |
·
|
when
we refer to changes in pension values in column "c" above, we are
referring to the aggregate change in the present value of the Named
Officer’s accumulated benefit under all defined benefit and actuarial
plans from the measurement date used for preparing our 2005 year-end
financial statements to the measurement date used for preparing our
2006
year-end financial statements (in the case of our 2006 compensation)
or
from the measurement date used for preparing our 2006 year-end financial
statements to the measurement date used for preparing our 2007 year-end
financial statements (in the case of our 2007 compensation); for
Mr.
Davis, the amounts in column "c" of the table consist of a $94,238
change
in value under the Union Center National Bank Pension Plan and a
$182,104
change in value under the Union Center National Bank Benefit Equalization
Plan for 2006 and a $108,251 change in value under the Union Center
National Bank Pension Plan and a $144,380 change in value under the
Union
Center National Bank Benefit Equalization Plan for 2007; for Mr.
Weagley,
Ms. Wunder, Mr. McGowan and Mr. Gorey, the amounts in column "c"
above
relate solely to changes in value under the Union Center National
Bank
Pension Plan;
|
| |
·
|
the
Named Officers did not receive any nonqualified deferred compensation
earnings during 2006 or 2007; when we refer to “nonqualified deferred
compensation earnings” in this table, we are referring to above-market or
preferential earnings on compensation that is deferred on a basis
that is
not tax-qualified, such as earnings on a nonqualified defined contribution
plan;
|
| |
·
|
“all
other compensation” in column "d" above includes the
following:
|
· for
Mr.
Davis: (i) for 2007: $1,575,995 in connection with the termination of Mr. Davis'
employment on August 23, 2007 (calculated as follows: three
times Mr. Davis’ salary (($1,081,000), three times Mr. Davis’ largest bonus
($314,976), a 401(k) match ($19,800), Mr. Davis’ SEP balance ($89,630) and a
SOPP payment of $69,7890), $8,356 representing premium expense for supplemental
long-term disability insurance, $12,228 representing premium payments with
respect to long-term care insurance, $15,212 representing premium payments
with
respect to group term life insurance and bank-owned life insurance for the
benefit of Mr. Davis and $6,750 representing matching payments that we made
under our 401(k) plan),
and (ii)
for 2006: $14,649 representing expense with respect to an automobile allowance,
$706 for car telephone expense, $13,506 representing tax gross-up payments
with
respect to fringe benefits, $12,408 representing premium payments with respect
to group term life insurance and bank-owned life insurance for the benefit
of
Mr. Davis, $6,600 representing matching payments that we made under our 401(k)
plan, $8,356 representing expense for supplemental long-term disability
insurance premium and $12,228 representing premium payments with respect to
long-term care insurance.
· for
Mr.
Weagley: (i) for 2007: $4,494
representing premium payments with respect to long-term care insurance, $15,157
representing expense with respect to an automobile allowance, $6,283
representing tax payments with respect to fringe benefits, $3,125 representing
matching payments that we made under our 401 (k) plan, and $1,436 representing
premiums for group term-life insurance and bank-owned life
insurance;
and (ii)
for 2006: $14,176 representing expense with respect to an automobile allowance,
$10,222 representing tax gross-up payments with respect to fringe benefits,
$1,400 representing premium payments with respect to group term life insurance
and bank-owned life insurance for the benefit of Mr. Weagley, $2,344
representing matching payments that we made under our 401(k) plan and $4,494
representing premium payments with respect to long-term care
insurance.
· for
Ms.
Wunder: (i) for 2007: $7,997
representing premium payments with respect to long-term care insurance, $14,347
representing expense with respect to an automobile allowance, $5,229
representing tax payments with respect to fringe benefits, $2,344 representing
matching payments that we made under our 401(k) plan, and $623 representing
premiums for group term-life insurance and bank-owned life
insurance;
and (ii)
for 2006: $13,910 representing expense with respect to an automobile allowance,
$8,072 representing tax gross-up payments with respect to fringe benefits,
$648
representing premium payments with respect to group term life insurance and
bank-owned life insurance for the benefit of Ms. Wunder, $1,875 representing
matching payments that we made under our 401(k) plan and $7,997 representing
premium payments with respect to long-term care insurance.
· for
Mr.
McGowan: (i) for 2007 $10,477
representing premium payments with respect to long-term care insurance, $14,241
representing expense with respect to an automobile allowance, $5,191
representing tax payments with respect to fringe benefits, $4,350 representing
matching payments that we made under our 401 (k) plan, and $3,183 representing
premiums for group term-life insurance and bank-owned life insurance, and
(ii)
for 2006: $14,259 representing expense with respect to an automobile allowance,
$175 for club membership fees, $8,488 representing tax gross-up payments with
respect to fringe benefits, $3,302 representing premium payments with respect
to
group term life insurance and bank-owned life insurance for the benefit of
Mr.
McGowan, $3,480 representing matching payments that we made under our 401(k)
plan and $10,477 representing premium payments with respect to long-term care
insurance; and
· for
Mr.
Gorey: (i) for 2007: $12,348
representing premium payments with respect to long-term care insurance, $12,501
representing expense with respect to an automobile allowance, $4,557
representing tax payments with respect to fringe benefits, $3,850 representing
matching payments that we made under our 401 (k) plan, and $924 representing
premium for group term-life insurance and bank-owned life insurance;
and
(ii) for 2006:
$4,136
representing expense with respect to an automobile allowance, $2,372
representing tax gross-up payments with respect to fringe benefits, $826
representing premium payments with respect to group term life insurance and
bank-owned life insurance, and $2,475 representing matching payments
that we made under our 401(k) plan.
| |
·
|
“all
other compensation” does not include our contributions under our Savings
Equalization Plan or our Senior Officers Protection Plan, both of
which
are non-qualified deferred compensation plans; for information regarding
such contributions, see the “Nonqualifed Deferred Compensation” table
presented elsewhere in this proxy statement.
|
Grants
of Plan-Based Awards
During
2007, our Named Officers did not receive any awards under any equity incentive
plan or non-equity incentive plan.
Outstanding
Equity Awards at December 31, 2007
The
following table sets forth, for each of the Named Officers, information
regarding stock options outstanding at December 31, 2007. As of that date,
all
stock options held by the Named Officers were fully vested and the Named
Officers held no outstanding stock awards.
|
Name
(a)
|
|
Number of
Securities
Underlying
Unexercised
Options
(#)
Exercisable
(b)
|
|
Option Exercise
Price
($)
(c)
|
|
Option
Expiration Date
(d)
|
|
|
John
J. Davis
|
|
|
0
|
|
|
—
|
|
|
—
|
|
| |
|
|
|
|
|
|
|
|
|
|
|
Anthony
C. Weagley
|
|
|
5,137
4,631
9,595
|
|
|
6.07
8.97
10.64
|
|
|
6/17/2009
6/20/2012
10/19/2015
|
|
| |
|
|
|
|
|
|
|
|
|
|
|
Lori
A. Wunder
|
|
|
4,631
6,519
|
|
|
8.97
10.64
|
|
|
6/20/2012
10/19/2015
|
|
| |
|
|
|
|
|
|
|
|
|
|
|
John
F. McGowan
|
|
|
6,918
4,631
6,108
|
|
|
6.07
8.97
10.64
|
|
|
6/17/2009
6/20/2012
10/19/2015
|
|
| |
|
|
|
|
|
|
|
|
|
|
|
Christopher
Gorey
|
|
|
2,014
|
|
|
6.07
|
|
|
6/17/2009
|
|
In
the
table above, we are disclosing:
| · |
in
column "b", the number of shares of our common stock underlying
unexercised stock options that were exercisable as of December 31,
2007;
and
|
| · |
in
columns "c" and "d", respectively, the exercise price and expiration
date
for each stock option that was outstanding as of December 31,
2007.
|
Options
Exercises and Stock Vested
None
of
the Named Officers held any stock awards that vested during 2007.
The
following table sets forth, for each of the Named Officers, information
regarding stock options exercised during 2007. The phrase “value realized on
exercise” represents the number of shares of common stock set forth in column
"b" multiplied by the difference between the market price of our common stock
on
the date of exercise and the Named Officer’s exercise price.
| |
|
Option
Awards
|
|
|
Name
(a)
|
|
Number
of
Shares
Acquired
on
Exercise
(#)
(b)
|
|
Value
Realized
on
Exercise
($)
(c)
|
|
|
John
J. Davis
|
|
|
2,900
10,025
1,700
3,193
4,600
1,500
2,000
2,079
500
|
|
|
5,162
17,845
2,431
4,726
7,610
2,475
3,300
3,493
875
|
|
| |
|
|
|
|
|
|
|
|
Anthony
C. Weagley
|
|
|
0
|
|
|
—
|
|
| |
|
|
|
|
|
|
|
|
Lori
A. Wunder
|
|
|
6,422
|
|
|
37,890
|
|
| |
|
|
|
|
|
|
|
|
John
F. McGowan
|
|
|
0
|
|
|
|
|
| |
|
|
|
|
|
|
|
|
Christopher
Gorey
|
|
|
750
|
|
|
4,395
|
|
Pension
Benefits
The
following table sets forth, for each of the Named Officers, information
regarding the benefits payable under each of our plans that provides for
payments or other benefits at, following, or in connection with such Named
Officer’s retirement. Those plans are summarized below the following table. The
following table does not provide information regarding tax-qualified defined
contribution plans or nonqualified defined contribution plans.
|
Name
(a)
|
|
Plan
Name
(b)
|
|
Number
of
Years of
Credited
Service
(#)
(c)
|
|
Present
Value of
Accumulated
Benefit
($)
(d)
|
|
Payments
During
Last
Fiscal
Year
($)
(e)
|
|
|
John
J. Davis
|
|
|
Union
Center National Bank Pension Plan Trust
|
|
|
30
|
|
$
|
1,007,657
|
|
$
|
13,961
|
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
John
J. Davis
|
|
|
Union
Center National Bank Benefit Equalization Plan
|
|
|
30
|
|
$
|
1,680,921
|
|
$
|
25,934
|
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Anthony
C. Weagley
|
|
|
Union
Center National Bank Pension Plan Trust
|
|
|
23
|
|
$
|
183,568
|
|
$
|
0
|
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Lori
A. Wunder
|
|
|
Union
Center National Bank Pension Plan Trust
|
|
|
12
|
|
$
|
101,973
|
|
$
|
0
|
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
John
F. McGowan
|
|
|
Union
Center National Bank Pension Plan Trust
|
|
|
12
|
|
$
|
289,917
|
|
$
|
0
|
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Christopher
Gorey
|
|
|
Union
Center National Bank Pension Plan Trust
|
|
|
9
|
|
$
|
87,708
|
|
$
|
0
|
|
In
the
table above:
|
|
· |
we
have determined the years of credited service based on the same
pension
plan measurement date that we used in preparing our audited financial
statements for the year ended December 31, 2007; we refer to that
date as
the “Plan Measurement Date”;
|
|
|
· |
when
we use the phrase “present value of accumulated benefit”, we are referring
to the actuarial present value of the Named Officer’s accumulated benefits
under our pension plans, calculated as of the Plan Measurement
Date;
|
|
|
· |
the
present value of accumulated benefits shown in the table above
have been
determined using the assumptions set forth in our audited financial
statements for the year ended December 31, 2007;
and
|
|
|
· |
column
"e" refers to the dollar amount of payments and benefits actually
paid or
otherwise provided to the Named Officer during 2007 under our pension
plans.
|
The
Union
Center National Bank Pension Trust - which we refer to as the “Pension Plan” -
is intended to be a tax-qualified defined benefit plan under Section 401(a)
of
the Internal Revenue Code. The Pension Plan, which has been in effect since
March 15, 1950, generally covers employees of Union Center National Bank and
the
Center Bancorp who have attained age 21 and completed one year of service.
The
normal retirement (age 65) pension payable under the Pension Plan is generally
equal to 44% of a participant’s highest average compensation over a 5-year
period. Compensation means a participant’s W-2 wages, increased by certain
reductions such as 401(k) contributions. The normal retirement benefit is
proportionately reduced if a participant has less than 25 years of service
at
age 65. Mr. Davis is currently the only Named Officer eligible to retire with
a
normal retirement pension. As
of
November 1, 2007, Mr. Davis was entitled to receive a pension under the Pension
Plan of $6,980 per month, payable for life.
A
participant may retire before or after age 65. A participant will qualify for
immediate commencement of an early retirement pension if he or she retires
after
attaining age 60 and completing at least six years of service. A participant
who
completes five years of service is entitled to a vested pension commencing
at
normal retirement age or after meeting the early retirement requirements. Early
retirement and vested pension benefits are calculated in the same manner as
a
normal retirement pension, but are multiplied by a fraction the numerator of
which is the participant’s years of service and the denominator of which is the
number of years of service the participant would have accumulated through normal
retirement. Benefits payable prior to normal retirement are also subject to
adjustment for actuarial equivalence, using age and interest factors specified
by the Pension Plan. Mr. McGowan is the only Named Officer not eligible for
normal retirement who is currently eligible for an early retirement pension
under the Pension Plan. As of December 31, 2007, Mr. McGowan’s accrued normal
retirement pension, payable for life commencing at age 65, was approximately
$2,864
per
month. Mr. McGowan’s accrued early retirement pension benefit as of December 31,
2007 was approximately $2,018 per
month, payable for life.
Pension
Plan benefits are generally payable in the form of a life annuity or a joint
and
survivor annuity. However, a participant may elect to receive his or her pension
in a lump sum. All forms of benefit are actuarially equivalent to a single
life
annuity form.
We
also
administer the Union Center National Bank Benefit Equalization Plan, or “BEP”.
The “BEP” is a nonqualified, unfunded supplemental retirement plan, which is
designed to replace the benefits that cannot be provided under the terms of
the
Pension Plan solely due to certain compensation and benefit limits placed on
tax-qualified pension plans under the Internal Revenue Code. For example, for
2007, the maximum amount of compensation that may be taken into account under
the Pension Plan was $225,000
and the maximum annual benefit that may be provided by a tax-qualified pension
plan, beginning at age 62, was $180,000.
The BEP
supplements the Pension Plan by providing any benefits that cannot be provided
under the Pension Plan due to these limitations. Coverage under the BEP is
limited to selected officers of Union Center National Bank. As of September
30,
2007, when benefits under the BEP were frozen, John
J.
Davis was
the
only participant in the BEP. To
set
aside funds to help meet its obligations under the BEP, Union
Center National Bank
established a trust as of July 1, 1997. Union
Center National Bank
may
contribute funds to this trust from time to time. The trust funds, which are
subject to the claims of Union
Center National
Bank’s
creditors in certain circumstances, will be held in trust until paid to plan
participants and their beneficiaries in accordance with the terms of the
BEP.
Nonqualified
Deferred Compensation
The
following table sets forth, for each of the Named Officers, information
regarding each defined contribution plan that we maintain and each other plan
that we maintain that provides for the deferral of compensation on a basis
that
is not tax-qualified. The applicable plans are described below the
table.
|
Name
(a)
|
|
Executive
Contributions
in
2007
($)
(b)
|
|
Registrant
Contributions
in
2007
($)
(c)
|
|
Aggregate
Earnings
in
2007
($)
(d)
|
|
Aggregate
Withdrawals/
Distributions
($)
(e)
|
|
Aggregate
Balance
at
December 31,
2007
($)
(f)
|
|
|
John
J. Davis
|
|
|
(1)
SEP 0
(2)
SOPP 0
|
|
$
$
|
1,169
14,949
|
|
$
$
|
1,338
0
|
|
$
$
|
0
89,630
|
|
$
$
|
0
0
|
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Anthony
C. Weagley
|
|
|
0
|
|
$
|
2,568
|
|
$
|
0
|
|
$
|
0
|
|
$
|
0
|
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Lori
A. Wunder
|
|
|
0
|
|
$
|
736
|
|
$
|
0
|
|
$
|
0
|
|
$
|
0
|
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
John
F. McGowan
|
|
|
0
|
|
$
|
2,762
|
|
$
|
0
|
|
$
|
0
|
|
$
|
0
|
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Christopher
Gorey
|
|
|
0
|
|
$
|
0
|
|
$
|
0
|
|
$
|
0
|
|
$
|
0
|
|
(1)
Mr.
Davis was the only participant in the SEP. Contributions under the SEP were
discontinued as of August 31, 2007. At December 31, 2007, the balance in Mr.
Davis' account was zero. Payments of $ 89,630 were made to Mr. Davis during
2007.
(2)
The
SOPP Plan was terminated on June 30, 2007. The distribution in the table above
represents a payment made to Mr. Davis All
other
dollar amounts represent participation in the SOPP for the Named Officers.
Since
the SOPP Plan terminated on June 30, 2007, there is a zero balance at year
end
2007 for each Named Officer's account.
The
balances for the SOPP as of the June 30, 2007 termination date are:
|
Davis
|
|
$
|
107,082
|
|
|
Weagley
|
|
$
|
22,907
|
|
|
Wunder
|
|
$
|
1,508
|
|
|
McGowan
|
|
$
|
19,061
|
|
|
Gorey
|
|
$
|
0
|
|
In
the
table above:
| · |
“registrant
contributions in 2007” in column "c" for Mr. Davis represents $1,169
in
contributions under the Union Center National Bank Savings Equalization
Plan (described below) and $14,949 in
contributions under the Union Center National Bank Senior Officers
Protection Plan or “SOPP” (described below). For each other Named Officer,
the amounts in column "c" represent solely contributions under the
SOPP;
|
| · |
when
we refer to the term “earnings” in column "d", we are referring to the
aggregate interest or other earnings accrued to the Named Officer’s
account during 2007;
|
| · |
the
amounts included in columns "c" and "d" of this table are not included
in
the Summary Compensation Table set forth above; and
|
| · |
the
amounts included in column "f" of this table were not included in
our
Summary Compensation Table in prior years’ proxy
statements.
|
The
Union
Center National Bank Savings Equalization Plan, or SEP, is a nonqualified,
unfunded plan, under which accounts of participating officers are credited
with
the amount of 401(k) and matching contributions that would have made under
our
tax-qualified 401(k) plan by and on behalf of a covered officer but for Code
limitations applicable to the 401(k) Plan. The maximum amount that may be
credited to a participant’s account under the SEP each year is limited to
two-times the amount of 401(k) contributions that are permitted by the Code
for
the year (for the year ended December 31, 2007, a total of $31,000.)
The
Union
Center National Bank Senior Officers Protection Plan, or SOPP, is a
nonqualified, unfunded plan of deferred compensation that was established
effective December 31, 2003 to replace the split-dollar life insurance
arrangements that we had in place for certain of our officers prior to that
time. We may, but are not required to, credit amounts from time to time to
the
accounts of participants under the SOPP. The amounts credited to each
participant’s account vest at the rate of 10% per year of service, commencing
after six years of service, counting years of service before the SOPP was
established. Accordingly, a participant must have at least 15 years of service
to be fully vested under the SOPP. However, a participant’s account under the
SOPP becomes fully vested in the event that he or she terminates employment
due
to death or disability, if the participant attains age 65 while employed by
us,
or if a change in control occurs (defined as the acquisition by a third party
of
thirty-three percent (33%) or more of the voting stock, or substantially all
of
the assets of, Center Bancorp, or a change in the composition of the Board
of
Directors of Union Center National Bank such that, during any two-year period,
a
majority of the members of the Board as of the beginning of the period no longer
serve on the Board of Union Center National Bank. We carry life insurance on
each participant to recover the cost of the benefits payable under the
SOPP.
The
vested SOPP account of a
participant who retires on or after attaining age 65 is payable in ten equal
annual installments, unless the participant has made a timely election to
receive the account in a single lump sum. A lump sum distribution of the vested
account will be paid in the event that a participant terminates employment
due
to death, due to disability or due to involuntary termination without
cause
We
also
maintain the Union Center National Bank Deferred Compensation Plan for Senior
Executives and Directors, or DCP. The DCP is also a nonqualified, unfunded
plan,
that permits officers of Union Center National Bank at a position of senior
vice
president or higher, to defer up to 80% of their salary and bonuses, if any,
to
be earned for the year following the year in which the election is made. Under
the DCP, the members of our Board may also elect to defer up to 100% of their
Board fees, committee fees and/or annual retainer for the year following the
year in which the election is made. Deferrals are credited with an amount
equivalent to the effective annual rate of return on Union Center National
Bank’s money market fund or a rate of return designated by our Board. Deferrals
under the DCP, which are not subject to forfeiture, are payable at termination
of a participant’s service or at a date or age specified by the participant at
the time a deferral is elected. Participants may elect, at the time a deferral
election is made, to have their accounts distributed in either a lump sum or
in
installments over not more than 15 years. Earlier distributions are not
permitted except in the event of a participant’s unforeseeable emergency. No
deferrals under the DCP were made by our Named Officers during 2006.
Stock
Option Plans
We
currently maintain two stock option plans in which our employees participate,
our 1999 Employee Stock Incentive Plan and our 1993 Employee Stock Option Plan.
Options may no longer be granted under the 1993 Employee Stock Option Plan.
We
adopted both plans in order to attract and retain qualified officers and
employees. Under the 1999 Employee Stock Incentive Plan, our Compensation
Committee may grant so-called “incentive stock options” as defined under the
Internal Revenue Code, non-qualified stock options and restricted stock awards
to our employees, including our officers. Under the 1993 Employee Stock Option
Plan, our Compensation Committee was able to grant incentive stock options
and
non-qualified stock options to our employees, also including our
officers.
We
initially had 435,153
shares
of our Common Stock authorized for issuance under the 1999 Employee Stock
Incentive Plan. This number has been adjusted for stock splits and stock
dividends. A total of 228,151
shares
remained available for grant as of January 1, 2008. All of our 181
employees are eligible to participate in the 1999 Employee Stock Incentive
Plan.
Future grants under the 1999 Employee Stock Incentive Plan have not yet been
determined. No option will be exercisable more than ten years from the date
of
grant and no option may be granted after April 13, 2009 under our 1999 Employee
Stock Incentive Plan.
We
initially had 633,194
shares
of our Common Stock authorized for issuance under the 1993 Employee Stock Option
Plan. This number also has been adjusted for stock splits and stock dividends.
All of our employees were eligible to participate in the 1993 Employee Stock
Option Plan. No option granted under the 1993 Employee Stock Option Plan is
exercisable more than ten years from the date of grant.
The
following table provides information about the common stock that may be issued
upon the exercise of options, warrants and rights under our 1999 Employee Stock
Incentive Plan, 1993 Employee Stock Option Plan, 1993 Outside Director Stock
Option Plan and 2003 Non-Employee Director Stock Option Plan as of December
31,
2007. These plans were our only equity compensation plans in existence as of
December 31, 2007.
|
Plan
Category
|
|
Number of Securities to
be Issued Upon Exercise
of Outstanding Options,
Warrants and Rights
(a)
|
|
Weighted Average
Exercise Price of
Outstanding Options,
Warrants and Rights
(b)
|
|
Number of Securities
Remaining Available for
Future Issuance Under
Equity Compensation
Plans (Excluding
Securities Reflected in
Column (a))
(c)
|
|
|
Equity Compensation
Plans Approved by
Shareholders
|
|
|
264,355
|
|
|
|
|
|
685,159
|
|
|
Equity
Compensation Plans Not Approved by
Shareholders
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
Total
|
|
|
264,355
|
|
|
|
|
|
685,159
|
|
Employment
Agreements
John
J. Davis
On
February 20, 2007, John J. Davis, our former chief executive officer, entered
into an amended and restated employment agreement with us that provided for
Mr.
Davis' continued employment as President and Chief Executive Officer through
December 31, 2012, subject to automatic renewal for one-year terms thereafter
unless either we or Mr. Davis provides the other with notice of non-renewal.
The
agreement was effective as of January 1, 2007. Prior to its amendment and
restatement, the employment agreement contained renewal provisions that, in
effect, assured Mr. Davis of at least three years' notice of termination in
the
absence of a "Change in Control Event" and five years' notice of termination
in
connection with a Change in Control Event. A "Change in Control Event" was
defined as the acquisition by a third party of a majority of the voting stock
or
substantially all of the assets of Center Bancorp or Union Center National
Bank
or a change in the composition of our Board of Directors such that the members
of our Board as of January 1, 2007, together with individuals nominated to
our
Board by unanimous vote of the members of our Board as of January 1, 2007,
no
longer constitutes a majority of the members of our Board.
In
2007,
Mr. Davis' salary was $360,600 per annum. In subsequent years, Mr. Davis was
to
receive his salary for the immediately preceding 12 month period plus such
salary increment as would be determined by the compensation committee of Union
Center National Bank's Board of Directors, with reference to our salary guide.
The employment agreement also provided that Mr. Davis would receive benefits
and
perquisites appropriate to his position.
As
restated effective as of January 1, 2007, Mr. Davis' employment agreement
provided that if Mr. Davis’ employment was terminated without cause or he
resigned for “good reason” during the term, he would receive a lump sum payment
equal to three times the sum of the annual rate of salary that he was receiving
at the time of termination and the largest bonus he received under the AIP.
In
addition, Mr. Davis was entitled to receive a lump sum payment equal to the
difference between the amount of benefits, if any, that he would have accrued
under the Pension Plan and the BEP, as well as the amount of additional
contributions that would have been made on his behalf by Union Center National
Bank under our 401(k) Plan and which he could have earned under the SEP and
the
SOPP, had his employment continued for a period of three additional years,
and
any unvested stock options held by Mr. Davis would become fully vested. If
Mr.
Davis’ employment was terminated without cause or he resigned for “good reason,”
we were also required to continue his health, life and long-term care insurance
coverage for an additional three years.
Under
Mr.
Davis’ employment agreement, he had the right to resign for “good reason” within
180 days after a material adverse change in his duties or title, a material
breach of the employment agreement by us, or a Change in Control Event.
Mr.
Davis
retired in August 2007. In connection with the termination of his employment,
Mr. Davis received a severance payment of $1,575,995, representing three times
his then existing annual salary ($1,081,800), three times his incentive payments
($314,976), his 401(k) match of $19,800, a payment under our SOPP of $69,789
and
a SEP payment of $89,630.
In
August
2007, Mr. Davis, who ceased to serve on the Boards of Center Bancorp and Union
Center National Bank in May 2007, was added to both Boards, where he served
until October 31, 2007, when he resigned from both positions. At that time,
Center Bancorp repurchased all of Mr. Davis' shares of our common stock as
part
of our buyback program at an aggregate price of $2,301,460.
Anthony
Weagley
On
April
15, 2008, Anthony Weagley, our current chief executive officer, entered into
an
amended and restated employment agreement. The agreement provides for a term
that expires on December 31, 2009, without any renewal. However, if a Change
in
Control Event (as defined) occurs during the term of the agreement, the
agreement will automatically extend for a period of three years after that
event. The agreement provides for a salary of $225,000 per year, the issuance
of
$25,000 of stock on December 31, annually
during the term of the agreement (prorated if Mr. Weagley works less that a
full
year), participation in our Achievement Incentive Plan, a car allowance
and health and life insurance and benefits under our 401(k) Plan. In the event
that Mr. Weagley is terminated without Cause (as defined) or he terminates
with
"Good Reason" (as defined), he will be entitled to receive (a) a lump sum
severance payment equal to three times the sum of (i) his annual base salary
as
in effect immediately prior to the termination, (ii) the largest annual cash
bonus he ever receives from us (the "Weagley Largest Bonus"), (iii) the amount
recorded on his W-2 (for the calendar year preceding the calendar year in which
the termination occurs) that is attributable to fringe benefits provided to
him
by us, and (iv) the maximum matching contribution that could have been made
under our 401(k) plan if he had remained employed by us for an additional year
following the date of termination; (b) a lump sum payment equal to the excess,
if any, of (x) the lump sum present value of the benefit that Mr. Weagley would
have been entitled to receive under our tax-qualified defined benefit pension
plan (the "Pension Plan") had he continued to be employed by us for an
additional three year period following the termination (assuming that he
continued during such period to receive a salary equal to the salary in effect
on the date of termination and an annual incentive bonus equal to the Weagley
Largest Bonus), over (y) the lump sum present value of the benefit that Mr.
Weagley is entitled to receive under the Pension Plan as of the date of his
termination of employment; (c) in certain circumstances, COBRA coverage for
eighteen months; (d) continued life insurance coverage for three years, and
(e)
acceleration of all unvested stock options. Substantially all of the payments
and benefits are conditioned upon Mr. Weagley's execution, delivery and
non-revocation of a general release in favor of Center Bancorp and related
parties.
Lori
Wunder and John McGowan
Lori
A.
Wunder and John F. McGowan each entered into employment agreements with us
that
were substantially similar to Mr. Davis' employment agreement. Those agreements
were amended and restated effective as of January 1, 2007. As amended and
restated as of January 1, 2007, each of their employment agreements provided
for
an initial term that expired on December 31, 2009. Each agreement contained
renewal provisions that, in effect, assured the executive of at least two years'
notice of termination in the absence of a Change in Control Event and three
years' notice of termination in connection with a Change in Control Event.
On
December 3, 2007, Ms. Wunder and Mr. McGowan agreed to amendments to their
employment agreements. The amended agreement provides for a term that expires
on
December 31, 2009, without any renewal. However, if a Change in Control Event
(as defined in substantially the same manner as reflected above) occurs during
the term of the agreement, the agreement will automatically extend for a period
of three years after that event.
Effective
January 1, 2008, we are no longer obligated to provide Ms. Wunder or Mr. McGowan
with automobiles. Under the December 3, 2007 amendments, we are obligated to
provide Ms. Wunder with an expense reimbursement of forty-four cents per mile
based on a daily mileage log for Bank business and to provide Mr. McGowan with
an automobile expense reimbursement of $600 per month and thirty cents per
mile
based upon a daily mileage log for Bank business. Title to the automobiles
then
being driven by and in the possession of each of Ms. Wunder and Mr. McGowan
were
transferred from the Bank to the respective employee without additional payment
by the employee. The amended employment agreements require us to provide Ms.
Wunder and Mr. McGowan with life insurance, short and long-term disability
insurance health insurance, pension benefits and benefits under the Bank's
401(k) Plan to the extent that such benefits were provided on December 3, 2007,
together with any benefit enhancements that may be added to such plans in the
future. The monetary amount of such benefits received by each employee shall
be
in accordance with the terms and conditions of such plans.
Mr.
McGowan resigned his position in January 2008. As a result of his resignation,
no severance was paid under his employment agreement.
If
the
employment of Ms. Wunder is terminated without cause or if she resigns for
“good
reason” (defined in the same manner as Mr. Davis’ employment agreement) during
the term, she will receive a lump sum payment equal to two times (three times
if
the termination is in connection with a Change in Control Event) the sum of
the
annual rate of salary that she was receiving at the time of termination and
the
largest bonus she received under the AIP. In addition, she will receive a lump
sum payment equal to the difference between the amount of benefits, if any,
that
she would have accrued under our Pension Plan, as well as the amount of
additional contributions that we would have made on her behalf under our 401(k)
Plan and the amount she would have earned under the SOPP, had her employment
continued for a period of two additional years (three years if the termination
is in connection with a Change in Control Event). Further, any unvested stock
options held by Ms. Wunder will become fully vested and we will continue health,
life and long-term care insurance coverage for the executive for an additional
two years (or three years if the termination is in connection with a Change
in
Control Event.
Christopher
Gorey
Effective
as of January 1, 2007, we entered into a change in control agreement with
Christopher M. Gorey. The agreement provided for a term expiring on December
31, 2009.
Initially, Mr. Gorey’s agreement was subject to renewal provisions that, in
effect, assured Mr. Gorey of at least twelve months’ notice of termination of
the agreement. The change in control agreement automatically terminates if
Mr.
Gorey’s employment is terminated prior to a Change in Control Event. Mr. Gorey
has the right under the change in control agreement to resign with "good
reason," which is defined to mean a resignation by Mr. Gorey within 180 days
after the occurrence of a Change in Control Event (defined in the same manner
as
under the employment agreements described above). Upon termination for good
reason, Mr. Gorey is entitled under the change in control agreement to: (a)
a
lump sum severance payment equal to three (3) times the sum of (i) his annual
base salary as in effect immediately prior to the termination, (ii) the largest
annual cash bonus he ever received from us, (iii) the amount recorded on his
W-2
(for the calendar year preceding the calendar year in which the termination
occurs) that is attributable to fringe benefits provided to him by us, (iv)
the
annual premium of his long-term care policy as in effect immediately preceding
the termination to the extent such amount is not recorded on his W-2 as
attributable to fringe benefits, and (v) the maximum matching contribution
that
could have been made under our 401(k) plan if he had remained employed by us
for
an additional year following the date of termination; (b) a lump sum payment
equal to the difference between the amount of benefits, if any, that he would
have accrued under our Pension Plan had his employment continued for a period
of
three additional years; (c) subsidized COBRA coverage for 18 months; (d)
continued life insurance coverage for three years, and (e) acceleration of
all
unvested stock options. The payments and benefits are conditioned upon Mr.
Gorey's execution, delivery and non-revocation of a general release in favor
of
us and related parties. Mr. Gorey is entitled to comparable benefits if we
were
to terminate his employment without "cause" upon, or within twelve months
following, a Change in Control Event.
Mr.
Gorey's agreement was amended on December 3, 2007. Pursuant to the amendment,
the agreement will terminate on December 31, 2009 and will not renew
thereafter.. Notwithstanding the foregoing, if a "Change in Control Event"
occurs at any time prior to December 31, 2009, then the term of the change
in
control agreement shall automatically be extended for a period of one year
from the date of such Change in Control Event.
Richard
Abrahamian
On
April 15, 2008, we entered into a
change in control agreement with Richard Abrahamian, our new chief financial
officer. The agreement will terminate on February 2, 2010 and will not renew
thereafter. Notwithstanding the foregoing, if a "Change in Control Event" occurs
at any time prior to February 2, 2010, then the term of the change in control
agreement shall automatically be extended for a period of one year from the
date of such Change in Control Event.
The
change in control agreement permits Mr. Abrahamian to resign with "good reason,"
which is defined to mean a resignation by Mr. Abrahamian within 180 days after
the occurrence of a Change in Control Event (as defined). Upon termination
of
employment by Mr. Abrahamian for good reason with respect to a Change in Control
Event that occurs during the term of the agreement or upon termination of Mr.
Abrahamian's employment by us without cause (as defined) within one year after
a
Change in Control Event, Mr. Abrahamian is entitled to: (a) a lump sum severance
payment equal to three times the sum of (i) his annual base salary as in effect
immediately prior to the termination, (ii) the largest annual cash bonus he
ever
receives from us (the "Largest Bonus"), (iii) the amount recorded on his W-2
(for the calendar year preceding the calendar year in which the termination
occurs) that is attributable to fringe benefits provided to him by us, and
(iv)
the maximum matching contribution that could have been made under our 401(k)
plan if he had remained employed by us for an additional year following the
date
of termination; (b) a lump sum payment equal to the excess, if any, of (x)
the
lump sum present value of the benefit that Mr. Abrahamian would have been
entitled to receive under our Pension Plan had he continued to be employed
by us
for an additional three year period following the termination (assuming that
he
continued during such period to receive a salary equal to the salary in effect
on the date of termination and an annual incentive bonus equal to the Largest
Bonus), over (y) the lump sum present value of the benefit that Mr. Abrahamian
is entitled to receive under the Pension Plan as of the date of his termination
of employment; (c) in certain circumstances, COBRA coverage for eighteen months;
(d) continued life insurance coverage for three years, and (e) acceleration
of
all unvested stock options. Substantially all of the payments and benefits
are
conditioned upon Mr. Abrahamian's execution, delivery and non-revocation of
a
general release in favor of Center Bancorp and related parties.
General
Each
of
the employment agreements for Mr. Davis, Ms. Wunder, and Mr. McGowan, and the
change in control agreement with Mr. Gorey, contain or contained "gross up"
provisions which provide for additional payments in the event that any amounts
payable or benefits provided to them pursuant to their employment or change
in
control agreements are subject to certain excise taxes imposed by Section 4999
of the Internal Revenue Code. Mr. Abrahamian's agreement and Mr. Weagley's
agreement provide for a reduction in benefits if necessary to assure that the
compensation payable thereunder is not subject to such excise
taxes.
If
Mr.
Weagley, Ms. Wunder, Mr. McGowan and Mr. Gorey were to terminate employment
in
connection with a Change in Control Event, based upon their compensation for
2007, the estimated amounts that Mr. Weagley, Ms. Wunder and Mr. McGowan would
have been entitled to under their respective amended and restated employment
agreements, and the estimated amount that Mr. Gorey would have been entitled
to
under his amended and restated change
in
control agreement, would
have been approximately the following: for Mr. Weagley: $909,000; for Ms.
Wunder: $539,000; for Mr. McGowan: $493,000; and for Mr. Gorey: $404,000. These
amounts exclude the payment of medical benefits for a period of 18 months after
the Change in Control Amount.
Compensation
of Directors
The
following table sets forth certain information regarding the compensation we
paid to our directors during that portion of 2007 in which they served on our
Board. Certain members of the Board named below served on our Board for only
a
portion of 2007. Messrs. Seidman, Schechter and Vanaria were newly elected
to
the Board in May 2007, Messrs. Kein and Schroeder ceased serving on the Board
in
May 2007, Mr. Battiato ceased serving on the Board in August 2007 and Mr. LaMont
ceased serving on the Board in November 2007. Mr. Davis served on the Board
from
January 2007 through May 2007 (during which period he was also our Chief
Executive Officer) and from August 2007 (after his resignation as Chief
Executive Officer) through October 2007. Mr. Davis did not receive any
compensation with respect to his Board service from August through October
2007.
None
of
our directors received stock awards during 2007 or any compensation under any
non-equity incentive plan.
|
Name
(a)
|
|
Fees
Earned
or
Paid in
Cash
($)
(b)
|
|
Option
Awards
($)
(d)
|
|
Change in
Pension
Value and
Nonqualified
Deferred
Compensation
Earnings
($)
(e)
|
|
All
Other
Compensation
($)
(f)
|
|
Total
($)
(g)
|
|
|
Alexander
Bol
|
|
|
33,000
|
|
|
15,077
|
|
|
3,676
|
|
|
1,636
|
|
|
53,389
|
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Hugo
Barth, III
|
|
|
23,200
|
|
|
15,077
|
|
|
4,618
|
|
|
2,721
|
|
|
45,616
|
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Kenneth
W. Battiato
|
|
|
16,000
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
16,000
|
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Brenda
Curtis
|
|
|
23,200
|
|
|
15,077
|
|
|
6,782
|
|
|
2,256
|
|
|
47,315
|
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Donald
G. Kein
|
|
|
14,200
|
|
|
(6,914
|
)
|
|
Retired
|
|
|
2,342
|
|
|
9,628
|
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
James
J. Kennedy
|
|
|
23,000
|
|
|
15,077
|
|
|
1,728
|
|
|
1,119
|
|
|
40,924
|
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
John
DeLaney
|
|
|
23,200
|
|
|
3,281
|
|
|
1,773
|
|
|
1,412
|
|
|
29,666
|
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Paul
Lomakin, Jr.
|
|
|
18,700
|
|
|
15,077
|
|
|
(1,887
|
)
|
|
4,838
|
|
|
36,728
|
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Stephen
J. LaMont
|
|
|
21,100
|
|
|
3,281
|
|
|
1,978
|
|
|
3,737
|
|
|
30,096
|
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Eugene
V. Malinowski
|
|
|
20,300
|
|
|
15,077
|
|
|
3,378
|
|
|
2,658
|
|
|
41,413
|
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Herbert
Schiller
|
|
|
21,400
|
|
|
15,077
|
|
|
(1,598
|
)
|
|
—
|
|
|
36,477
|
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Norman
F. Schroeder
|
|
|
14,200
|
|
|
(6,914
|
)
|
|
651
|
|
|
706
|
|
|
8,643
|
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Harold
Schechter
|
|
|
10,683
|
|
|
—
|
|
|
848
|
|
|
—
|
|
|
11,531
|
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Lawrence
Seidman
|
|
|
12,783
|
|
|
—
|
|
|
1,093
|
|
|
—
|
|
|
13,876
|
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
William
Thompson
|
|
|
23,200
|
|
|
15,077
|
|
|
1,440
|
|
|
1,033
|
|
|
40,750
|
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Raymond
Vanaria
|
|
|
11,883
|
|
|
—
|
|
|
1,057
|
|
|
—
|
|
|
12,940
|
|
In
the
table above:
|
|
· |
when
we refer to “Fees
Earned or Paid in Cash” in column "b", we
are referring to all cash fees that we paid or were accrued in
2007,
including annual retainer fees, committee and /or chairmanship
fees and
meeting fees;
|
|
|
· |
when
we refer to “option awards” in column "d", we are referring to the dollar
amount recognized by us for financial statement purposes in accordance
with FAS 123R;
|
|
|
· |
the
grant date fair value for each of the option awards made to our
directors
during 2007 was $6.48 per
share;
|
|
|
· |
the
aggregate number of option awards outstanding for each director
at
December 31, 2007 were for Mr. Barth, 5,085 shares; Mr. Battiato,
0
shares; Mr. Bol, 868 shares; Ms. Curtis, 5,085 shares; Mr. Davis,
0
shares; Mr. DeLaney, 0 shares; Mr. Kein, 0 shares; Mr. Kennedy,
44,975
shares; Mr. LaMont, 0 shares; Mr. Lomakin, 5,085 shares; Mr. Malinowski,
0
shares; Mr. Schiller, 5,085 shares; Mr. Schechter, 0 shares; Mr.
Schroeder, 0 shares; Mr. Seidman, 0 shares; Mr. Thompson, 5,085
shares;
and Mr. Vanaria, 0 shares;
|
|
|
·
|
when
we refer to “Change in Pension Value and Nonqualified Deferred
Compensation Earnings”, we are referring to the aggregate change in the
present value of each director’s accumulated benefit under all defined
benefit and actuarial plans from the measurement date used for
preparing
our 2006 year-end financial statements to the measurement date
used for
preparing our 2007 year-end financial statements; for our directors,
such
amounts were: Mr. Barth, $4,618; Mr. Battiato, $0; Mr. Bol, $3,676;
Ms.
Curtis, $6,782; Mr. Davis, $0; Mr. DeLaney, $1,773; Mr. Kein, $0;
Mr.
Kennedy, $1,728; Mr. LaMont, $1,978; Mr. Lomakin, $(1,887); Mr.
Malinowski, $3,378; Mr. Schiller, $(1,598);Mr. Schechter, $848
Mr.
Schroeder, $651; Mr. Seidman, $1,093;Mr. Thompson, $1,440; and
Mr.
Vanaria, $1,057;
|
|
|
· |
“all
other compensation” in column "f" refers to the amount of premiums that we
paid during 2007 for long-term care insurance for each director;
and
|
|
|
· |
the
directors did not receive any nonqualified deferred compensation
earnings
during 2007.
|
The
table
above does not include fees paid during 2007 to Mr. Bol’s architectural firm
(less than $40,000 during 2007), Mr. DeLaney's law firm (less than $15,000
during 2007), Mr. Kein’s law firm (less than $85,000 during 2007) or Mr.
Schroeder’s construction services firm (less than $70,000 during 2007).
Two
of
our directors — Messrs. Kent and Kramer — were first elected to the Board on
February 28, 2008 and thus are not included in the table presented above, which
solely reflects compensation during 2007.
1993
Outside Director Stock Option Plan
Our
1993
Outside Director Stock Option Plan was adopted in order to attract and retain
qualified directors. Pursuant to our 1993 Outside Director Stock Option Plan,
directors Hugo Barth, Alexander A. Bol, Brenda Curtis, Donald G. Kein, James
J.
Kennedy, Paul Lomakin, Jr., Eugene V. Malinowski, Herbert Schiller, Norman
F.
Schroeder and William A. Thompson received a one-time stock option covering
36,181 shares of Common Stock (as adjusted for stock splits and stock
dividends). These options become exercisable in three installments, commencing
one year after the date of grant, at a per share exercise price equal to the
fair market value of one share of our common stock on the date of grant. Such
options may not be exercised more than ten years after their date of grant.
No
options were permitted to be granted under our 1993 Outside Director Stock
Option Plan after November 17, 2003.
We
initially had 569,876
shares
of our common stock authorized for issuance under our 1993 Outside Director
Stock Option Plan (as adjusted for stock splits and stock dividends). All
directors other than John J. Davis were eligible to participate in our 1993
Outside Director Stock Option Plan.
2003
Non-Employee Director Stock Option Plan
Our
2003
Non-Employee Director Stock Option Plan was adopted in order to attract and
retain qualified directors. Our 2003 Non-Employee Director Stock Option Plan
initially provided that on June 1 of each year, directors who served
continuously on our Board during the twelve months immediately preceding such
date and who were not employed by us or any of our subsidiaries during that
twelve month period would be granted a stock option covering 3,000 shares of
common stock. These options will vest over a four year period, subject to
acceleration in certain instances. For an eligible director who remained on
our
Board for the first five years of our 2003 Non-Employee Director Stock Option
Plan, the operation of the Plan as initially adopted would be as follows:
|
Date
|
|
Effect
|
| |
|
|
|
June
1, 2004
|
|
An
option covering 3,000 shares is granted; we will refer to this
option as
"Option A"; no shares are purchasable under Option A.
|
| |
|
|
|
June
1, 2005
|
|
An
option covering 3,000 shares is granted; we will refer to this
option as
"Option B"); 750 shares are purchasable under Option A; and no
shares are
purchasable under Option B.
|
| |
|
|
|
June
1, 2006
|
|
An
option covering 3,000 shares is granted; we will refer to this
option as
"Option C"; 1,500 shares are purchasable under Option A; 750
shares are
purchasable under Option
B; and no shares are purchasable under Option C.
|
| |
|
|
|
June
1, 2007
|
|
An
option covering 3,000 shares is granted; we will refer to this
option as
"Option D"; 2, 250 shares are purchasable under Option A; 1,500
shares are
purchasable under Option B; 750 shares are purchasable under
Option C; and
no shares are purchasable
under Option D.
|
| |
|
|
|
June
1, 2008
|
|
An
option covering 3,000 shares is granted; we will refer to this
option as
"Option E"; 3,000 shares are purchasable under Option A; 2,250
shares are
purchasable under
Option B; 1,500 shares are purchasable under Option C; 750 shares
are
purchasable under Option D; and no shares are purchasable under
Option
E.
|
During
2004, 2005, 2006 and 2007, after giving effect to stock splits and stock
dividends, we granted options covering 3,308, 3,473, 3,473 and 3,473 shares,
respectively, to each member of our Board, other than John J. Davis, pursuant
to
our 2003 Non-Employee Director Stock Option Plan. On February 28, 2008, our
Board adopted amendments to the 2003 Non-Employee Director Stock Option Plan
providing that options covering 3,473 shares would be granted on March 1 of
each
year, commencing March 1, 2008, to directors who served continuously on our
Board during the six months immediately preceding such date and who were not
employed by us or any of our subsidiaries during that six month
period.
Three
quarters of the options granted in 2004, one half of the options granted in
2005, one quarter of the options granted in 2006 and none of the options granted
in 2007 will be exercisable on or before April 29, 2008. We initially had
551,250 shares of our common stock authorized for issuance under our 2003
Non-Employee Director Stock Option Plan (as adjusted for stock splits and stock
dividends) and 457,007 shares remained available for grant as of January 1,
2008.
There
are
no fees paid to any director of Center Bancorp for any meeting of the Center
Bancorp Board of Directors. The chairman of the Audit Committee and the chairman
of the Compensation Committee receive $500 for each committee meeting attended.
Members of the Audit Committee and the Compensation Committee receive $300
for
each committee meeting attended. Alexander A. Bol, Chairman of the Board of
Union Center National Bank, receives a $15,000 annual retainer and $900 for
each
meeting of Union Center National Bank’s Board that he attends. All other
directors of Union Center National Bank who are not officers of that Bank
receive a $7,000 annual retainer and $900 for each meeting of the Union Center
National Bank Board that they attend.
Under
the
Union Center National Bank Directors' Retirement Plan, or "Directors' Retirement
Plan”, in effect since July 1, 1998, each non-employee member of the Board who
completes at least 15 years of service as a member of the Board (including
service on the Board prior to July 1, 1998), and who retires from the Board
after having attained age 70, will be paid an annual retirement benefit of
$8,500, payable monthly, commencing on his or her date of retirement and
continuing for 180 payments. In the event that a director dies before receiving
his or her entire benefit, the balance of such benefit will continue to be
paid
to the director's surviving spouse until the earlier of such spouse's death
or
the payment of all 180 such monthly installments. We have established
a trust to set aside funds to help meet our obligations under the Directors'
Retirement Plan.
While
the assets of the trust will generally be used to pay benefits to participants
and beneficiaries of the
Directors' Retirement Plan
in
accordance with the terms of the Directors'
Retirement Plan,
the
assets of the trust are subject to the claims of our
general
creditors in certain circumstances.
No
deferrals were made by any of our directors during 2006 under our Union Center
National Bank Deferred Compensation Plan for Senior Executives and Directors,
or
DCP, described previously in this proxy statement.
Compensation
Committee Interlocks and Insider Participation
The
Compensation Committee consists of Hugo Barth III, Alexander A. Bol, Brenda
Curtis, John J. DeLaney, Lawrence B Seidman and William A. Thompson. Of the
persons named, only Mr. Bol has served as an officer of Center Bancorp or Union
Center National Bank. Mr. Weagley participates in determinations regarding
compensation of all employees other than himself.
Directors
and former directors Hugo Barth III, Kenneth W. Battiato, Alexander A. Bol,
Brenda Curtis, John J. DeLaney, Jr., John J. Davis, Donald G. Kein, James J.
Kennedy, Stephen J. LaMont, Paul Lomakin, Jr., Eugene V. Malinowski, Herbert
Schiller, Norman F. Schroeder and William A. Thompson and certain of our
officers and their associates are and have been customers of Union Center
National Bank and have had loan transactions with Union Center National Bank
in
the ordinary course of business during 2007. All such transactions with these
directors and officers and their associates were made in the ordinary course
of
business on substantially the same terms, including interest rates and
collateral, as those prevailing at the time of such transactions for comparable
persons not related to us or Union Center National Bank and did not involve
more
than a normal risk of collectibility or present other unfavorable features.
Compensation
Committee Report
The
Compensation Committee has reviewed and discussed the information provided
under
the caption “Compensation Disclosure and Analysis” set forth above. Based on
that review and those discussions, the Compensation Committee recommended to
our
Board that such “Compensation Disclosure and Analysis” be included in this proxy
statement.
Hugo
Barth III
Alexander
A. Bol
Brenda
Curtis
John
J.
DeLaney, Jr.
Lawrence
B. Seidman
William
A. Thompson
Other
Compensation Committee Matters
Charter.
Our
Board of Directors has defined the duties of its Compensation Committee in
a
charter. A copy of the Compensation Committee’s charter was attached to last
year's proxy statement as Annex
A;
the
charter is not presently included on our Web site.
Authority,
Processes and Procedures. Our
Compensation Committee is responsible for administering our employee benefit
plans, for establishing the compensation of our president and chief executive
officer and for recommending to the Board the compensation of our other
executive officers. Our Compensation Committee also establishes policies and
monitors compensation for our employees in general. While the Compensation
Committee may, and does in fact, delegate authority with respect to the
compensation of employees in general, the Compensation Committee retains overall
supervisory responsibility for employee compensation. With respect to executive
compensation, the Compensation Committee receives recommendations and
information from senior staff members, as well as outside compensation
consultants, regarding issues relevant to determinations made by the
Compensation Committee. Mr. Davis participates in Committee deliberations
regarding the compensation of other executive officers, but does not participate
in deliberations regarding his own compensation.
Consultants.
Our
Compensation Committee is entitled to engage compensation consultants to assist
it in carrying out its duties. In prior years, compensation consultants have
provided recommendations regarding the forms and amounts of compensation of
our
president and chief executive officer as well as our other executive officers,
including salary levels, bonus amounts and related performance targets, equity
awards and long-term compensation arrangements. The Committee has also retained
consulting firms to provide comparisons of our compensation practices to those
of comparable financial institutions. However, the Compensation Committee did
not utilize the services of consultants during 2007.
Audit
Committee Matters
Charter.
Our
Board of Directors has established a separately-designated standing Audit
Committee in accordance with Section 3(a0(58)(A) of the Securities Exchange
Act
of 1934. Our Board of Directors has defined the duties of its Audit Committee
in
a charter. We attached a copy of the charter to last year's proxy statement
as
Annex
B;
the
charter is not presently included on our Web site.
Independence
of Audit Committee Members.
Our
Common Stock is listed on the Nasdaq National Market and Center Bancorp is
governed by the listing standards applicable thereto. All members of the Audit
Committee of the Board of Directors have been determined to be "independent
directors" pursuant to the definition contained in Rule 4200(a)(15) of the
National Association of Securities Dealers' Marketplace Rules and under the
SEC's Rule 10A-3.
Audit
Committee Financial Expert.
Our
Board of Directors has determined that one of the members of the Audit
Committee, Raymond Vanaria, constitutes an "audit committee financial expert",
as such term is defined by the SEC. As noted above, Mr. Vanaria - as well as
the
other members of the Audit Committee - has been determined to be "independent".
Audit
Committee Report.
In
connection with the preparation and filing of Center Bancorp's Annual Report
on
Form 10-K for the year ended December 31, 2007:
(1)
the
Audit Committee reviewed and discussed the audited financial statements with
our
management;
(2)
the
Audit Committee discussed with our independent auditors the matters required
to
be discussed by the Statement on Auditing Standards No. 61, as amended;
(3)
the
Audit Committee received the written disclosures and the letter from our
independent auditors required by the Independence Standards Board Standard
No. 1
(Independence Discussions with Audit Committees) and discussed with our
independent auditors their independence; and
(4)
based
on the review and discussions referred to above, the Audit Committee recommended
to our Board that the audited financial statements be included in our Annual
Report on Form 10-K for the year ended December 31, 2007.
By:
The
Audit Committee of the Board of Directors
James
J.
Kennedy
Elliot
Kramer
Harold
Schechter
William
Thompson
Raymond
Vanaria
Accounting
Fees and Other Accounting Matters
In
accordance with the requirements of the Sarbanes-Oxley Act of 2002 and the
Audit
Committee’s charter, all audit and audit-related work and all non-audit work
performed by our principal independent accountant is approved in advance by
the
Audit Committee, including the proposed fees for such work. The Audit Committee
is informed of each service actually rendered that was approved through its
pre-approval process.
Audit
Fees.
Audit
fees billed or expected to be billed to us by our principal independent
accountant for the audit of the financial statements included in our Annual
Report on Form 10-K for the years ended December 31, 2006 and 2007, and reviews
of the financial statements included in our Quarterly Reports on Form 10-Q
during 2006 and 2007, totaled $210,867 and $234,363, respectively.
Audit-Related
Fees.
We were
not billed by our principal independent accountant for assurance and related
services during the fiscal year ended December 31, 2006. A total of $15,712
in
Audit-related fees was billed for fiscal year 2007. Such services are defined
as
services which are reasonably related to the performance of the audit or review
of our financial statements but are not reported under the immediately preceding
paragraph.
Tax
Fees.
We were
billed an aggregate of $7,916 and $41,025 by our principal independent
accountant for the fiscal years ended December 31, 2006 and 2007, respectively,
for tax services, principally representing advice regarding the preparation
of
income tax returns
All
Other Fees.
We were
billed $0 and $0 by our principal independent accountant for the fiscal
years ended December 31, 2006 and 2007, respectively,
for all
services not covered in the immediately three preceding paragraphs.
Other
Matters.
The
Audit Committee has determined that the provision of all services provided
by
our principal independent accountant during the years ended December 31, 2006
and December 31, 2007 is compatible with maintaining the independence of our
principal independent accountant.
KPMG
LLP
was our principal independent accountant during 2005 and through May 5 of 2006.
Beard Miller Company LLP succeeded KPMG LLP as our principal independent
accountant on May 5, 2006. The fees referred to above refer to fees paid to
Beard Miller Company LLP for the years ended December 31, 2006 and
2007.
Nominating
Committee Matters
Independence
of Nominating Committee Members.
All
members of the Nominating Committee of our Board of Directors have been
determined to be "independent directors" pursuant to the definition contained
in
Rule 4200(a)(15) of the National Association of Securities Dealers' Marketplace
rules.
Procedures
for Considering Nominations Made by Shareholders.
The
Nominating Committee's charter describes procedures for nominations to be
submitted by shareholders and other third-parties, other than candidates who
have previously served on the Board or who are recommended by the Board. The
charter states that a nomination must be delivered to our corporate Secretary
at
the principal executive offices of Center Bancorp not later than the close
of
business on the 90th day nor earlier than the close of business on the 120th
day
prior to the first anniversary of the preceding year's annual meeting; provided,
however, that if the date of the annual meeting is more than 30 days before
or
more than 60 days after such anniversary date, notice to be timely must be
so
delivered not earlier than the close of business on the 120th day prior to
such
annual meeting and not later than the close of business on the later of the
90th
day prior to such annual meeting or the close of business on the 10th day
following the day on which public announcement of the date of such meeting
is
first made by us. The public announcement of an adjournment or postponement
of
an annual meeting will not commence a new time period (or extend any time
period) for the giving of a notice as described above. The charter requires
a
nomination notice to set forth as to each person whom the proponent proposes
to
nominate for election as a director: (a) all information relating to such person
that is required to be disclosed in solicitations of proxies for election of
directors in an election contest, or is otherwise required, in each case
pursuant to Schedule 14A under the Securities Exchange Act of 1934, as amended
(including such person's written consent to being named in the proxy statement
as a nominee and to serving as a director it elected), and (b) information
that
will enable the Nominating Committee to determine whether the candidate or
candidates satisfy the criteria established pursuant to the charter for director
candidates.
Qualifications.
The
charter describes the minimum qualifications for nominees and the qualities
or
skills that are necessary for directors to possess. Each nominee:
|
|
· |
must
satisfy any legal requirements applicable to members of the
Board;
|
|
|
· |
must
have business or professional experience that will enable such
nominee to provide useful input to the Board in its deliberations;
|
|
|
· |
must
have a reputation, in one or more of the communities serviced
by Center Bancorp and its subsidiaries, for honesty and
ethical conduct;
|
|
|
· |
must
have a working knowledge of the types of responsibilities expected
of members of the board of directors of a bank holding
company; and
|
|
|
· |
must have experience,
either as a member of the board of directors
of another public or private company or in another capacity,
that demonstrates the nominee's capacity to serve in a
fiduciary position.
|
Identification
and Evaluation of Candidates for the Board.
Candidates to serve on the Board will be identified from all available sources,
including recommendations made by shareholders. The Nominating Committee's
charter provides that there will be no differences in the manner in which the
nominating committee evaluates nominees recommended by shareholders and nominees
recommended by the Committee or management, except that no specific process
shall be mandated with respect to the nomination of any individuals who have
previously served on the Board. The evaluation process for individuals other
than existing Board members will include:
|
|
·
|
a review
of the information provided to the Nominating Committee
by the proponent;
|
|
|
·
|
if
requested, a review
of reference letters from at least two sources determined
to be reputable by the Nominating Committee;
and
|
|
|
·
|
a
personal interview of the
candidate,
|
together
with a review of such other information as the Nominating Committee shall
determine to be relevant.
Third
Party Recommendations.
In
connection with the 2008 Annual Meeting, the Nominating Committee did not
receive any nominations from any shareholder or group of shareholders which
owned more than 5% of our common stock for at least one year.
Charter.
Our
Board
of Directors has defined the duties of its Nominating Committee in a charter.
A
copy of the Nominating Committee’s charter was attached to last year's proxy
statement as Annex
C;
the
charter is not presently included on our Web site.
Code
of Ethics
We
are
required to disclose whether we have adopted a code of ethics that applies
to
our principal executive officer, principal financial officer, principal
accounting officer or controller or persons performing similar functions. We
have adopted such a code of ethics and have posted a copy of the code on our
internet website at the internet address: http://www.ucnb.com.
Copies
of the code may be obtained free of charge from our website at the above
internet address.
Compliance
with Section 16 of the Securities Exchange Act of 1934
Section
16(a) of the Securities Exchange Act of 1934 requires our directors, executive
officers and persons holding more than 10% of a registered class of the equity
securities of Center Bancorp to file with the SEC and to provide us with initial
reports of ownership, reports of changes in ownership and annual reports of
ownership of our common stock and other equity securities. As a result of the
adoption of the Sarbanes-Oxley Act of 2002, the reporting obligations with
respect to certain transactions were accelerated to 48 business hours after
the
transaction. Based
solely upon a review of such reports furnished to us, we believe that all such
Section 16(a) reports were timely filed with respect to the year ended December
31, 2007, except that directors Harold Schechter, Lawrence Seidman and Raymond
Vanaria, having first been elected to our Board in May 2007 after a contested
election, filed their initial statements of beneficial ownership nine or ten
days late, and director Herbert Schiller (who will cease to serve on our Board
upon consummation of this year's Annual Meeting) did not report the purchase
of
20,000 shares (effected over a four day period in December 2007) until February
21, 2008, when the failure to file the necessary report was
identified.
APPROVAL
OF AN AMENDMENT TO CENTER BANCORP'S CERTIFICATE OF
INCORPORATION
TO ELIMINATE THE CLASSIFIED BOARD OF DIRECTORS
Center
Bancorp’s Certificate of Incorporation provides that the Board of Directors
shall be divided into three classes, with each class having a three-year term.
In January 2008, the Board of Directors adopted, subject to stockholder
approval, amendments to revise Article Twelfth of the Certificate of
Incorporation to eliminate the classified Board of Directors. The proposal
would
allow for the annual election of directors in the manner described below. The
Board of Directors has set the current number of directors at 11. The proposal
would not change the present number of directors and the Board of Directors
will
retain the authority to change that number and to fill any vacancies or newly
created directorships.
Background
of Proposal
Classified or staggered boards have been widely adopted and have a long history
in corporate law. Proponents of classified boards assert that they promote
the
independence of directors because directors elected for multi-year terms are
less subject to outside influence. Proponents of a classified structure for
the
election of directors also believe it provides continuity and stability in
the
management of the business and affairs of a company because a majority of
directors always has prior experience as directors of the company. Proponents
further assert that classified boards may enhance stockholder value by forcing
an entity seeking control of a target company to initiate arms-length
discussions with the board of a target company because the entity is unable
to
replace the entire board in a single election.
Alternatively, some investors view classified boards as having the effect of
reducing the accountability of directors to stockholders because classified
boards limit the ability of stockholders to evaluate and elect all directors
on
an annual basis. The election of directors is a primary means for stockholders
to influence corporate governance policies and to hold management accountable
for implementing those policies. In addition, opponents of classified boards
assert that a classified structure for the election of directors may discourage
proxy contests in which stockholders have an opportunity to vote for a competing
slate of nominees and therefore may erode stockholder value.
Center Bancorp's Board of Directors has considered carefully the advantages
and
disadvantages of maintaining a classified board structure. The Board has decided
that it is an appropriate time to propose eliminating the classified Board.
This
determination by the Board furthers its goal of ensuring that the Company’s
corporate governance policies maximize management accountability to stockholders
and would, if adopted, allow stockholders the opportunity each year to register
their views on the performance of the entire Board of Directors. Accordingly,
the Board, after full review and deliberation, has determined that eliminating
the classified Board is in the best interests of the Company and its
stockholders.
The
elimination of the classified board requires an amendment to Center Bancorp's
Certificate of Incorporation. If this proposal is approved by the stockholders,
the terms of the nominees for election at the 2008 Annual Meeting would expire
at the 2009 annual meeting of stockholders, but the terms of the two other
classes of directors would not be shortened. Thus,
the
terms of the directors elected at our 2006 and 2007 annual meetings will
continue until 2009 and 2010, respectively. However, the directors elected
at
the 2007 annual meeting have advised us that if the shareholders approve the
proposed amendment, they will resign prior to next year’s annual meeting (and
presumably stand for re-election), so that the entire Board would be up for
election at next year’s annual meeting. If the proposal is not approved,
the directors elected at this year's annual meeting will be elected for three
year terms and there will be no change in the terms of the other
directors.
The
amendment to the Certificate of Incorporation to implement this proposal is
substantially set forth in Annex A. If approved, this proposal will become
effective upon the filing of a Certificate of Amendment to the Certificate
of
Incorporation with the Department of the Treasury of the State of New Jersey
containing substantially the language of this amendment, which the Company
would
do promptly after the annual meeting. At such time, the Board would consider
amendments to the Company’s Bylaws that would make the Bylaws consistent with
the proposed amendment to eliminate the classified Board.
Required
Vote and Board of Directors Recommendation
Approval
of this proposal requires the affirmative vote of a majority of the votes cast
at the annual meeting by shareholders represented and entitled to vote at the
annual meeting. Abstentions and broker non-votes will be counted as present
for
purposes of determining if a quorum is present, but will have no affect on
the
outcome of this proposal.
THE
BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS A VOTE “FOR” APPROVAL OF THE AMENDMENT
TO THE CERTIFICATE OF INCORPORATION TO ELIMINATE THE CLASSIFIED
BOARD.
INDEPENDENT
PUBLIC AUDITORS
The
Audit
Committee of our Board of Directors has appointed Beard Miller Company LLP,
or
Beard Miller, to perform the function of independent public auditors for the
year ending December 31, 2008. Representatives of Beard Miller are expected
to
attend our annual meeting and will be available to respond to appropriate
questions of shareholders. Such representatives will have an opportunity to
make
a statement at the annual meeting if they so desire.
On
May 5,
2006, the Audit Committee of our Board of Directors approved the dismissal
of
KPMG LLP, or KPMG, as our principal accountants and appointed Beard Miller
as
our principal accountants.
During
the years ended December 31, 2004 and 2005, and during the subsequent period
through the date on which we reported this matter in a Current Report on Form
8-K, there were:
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|
· |
no
disagreements with KPMG on any matter of accounting principles
or
practices, financial statement disclosure, or auditing scope or
procedures
which disagreements, if not resolved to the satisfaction of KPMG,
would
have caused KPMG to make reference to the subject matter of such
disagreements in connection with KPMG’s report on our financial statements
for the years ended December 31, 2004 and 2005;
and
|
|
|
· |
other
than with respect to the material weakness described below, no
“reportable
events” (as defined in Item 304(a)(v) of regulation S-K). Further, the
audit reports of KPMG on the consolidated financial statements
of Center Bancorp, Inc. and subsidiary as of and for the years
ended December 31, 2005 and 2004 did not contain an adverse opinion
or
disclaimer of opinion, and were not qualified or modified as to
uncertainty, audit scope or accounting principles.
|
KPMG’s
audit report on the consolidated financial statements of Center
Bancorp, Inc. and subsidiary as of and for the years ended December 31,
2005 and 2004 contained the following statement:
“We
also
have audited, in accordance with the standards of the Public Company Accounting
Oversight Board (United States), the effectiveness of Center Bancorp, Inc.
and
subsidiaries’ internal control over financial reporting as of December 31, 2005,
based on criteria established in
Internal Control—Integrated Framework issued
by
the Committee of Sponsoring Organizations of the Treadway Commission (COSO),
and
our report dated March 8, 2006 expressed an unqualified opinion on management’s
assessment of, and an adverse opinion on the effective operation of, internal
control over financial reporting.”
In
connection with its preparation of our consolidated financial statements as
of and for the years ended December 31, 2005 and 2004, we identified a material
weakness in internal control over financial reporting as of December 31, 2005
related to accounting for income taxes. Specifically, we did not employ an
adequate number of skilled personnel in our tax department to prepare the
reconciliation of internal tax schedules to the general ledger and supporting
documentation in a timely manner, and there was inadequate and ineffective
analysis and management review of the relevant documentation supporting the
deferred tax accounts related to the accounting for an acquisition of a
business. As a result, material misstatements were identified in our deferred
tax assets and liabilities and income tax expense accounts. Further, there
was
more than a remote likelihood that a material misstatement of our interim or
annual financial statements would not be prevented or detected. The Audit
Committee discussed this material weakness with KPMG. KPMG was authorized by
us
to fully respond to the inquiries of Beard Miller concerning the material
weakness.
We
requested KPMG to furnish a letter, pursuant to Item 304(a)(3) of the SEC’s
Regulation S-K, addressed to the SEC, stating whether it agrees with the above
statements. We filed a copy of that letter with the SEC on May 17,
2006.
During
the years ended December 31, 2005 and 2004, and during the subsequent period
through the date on which we reported this matter in a Current Report on Form
8-K, we did not consult with Beard Miller regarding the application of
accounting principles to a specified transaction or the type of audit opinion
that might be rendered on our financial statements or any of the matters or
events set forth in Item 304(a)(2)(ii) of the SEC’s Regulation
S-K.
SHAREHOLDER
MATTERS
If
a
shareholder intends to present a proposal at our 2009 Annual Meeting of
shareholders, the proposal must be received by us at our principal executive
offices not later than December 26, 2008 in order for that proposal to be
included in the proxy statement and form of proxy relating to that meeting,
and
by January 25, 2009 in order for the proposal to be considered at our
2009 annual meeting of shareholders (but not included in the proxy statement
or
form of proxy for such meeting). Any shareholder proposal which is received
after those dates or which otherwise fails to meet the requirements for
shareholder proposals established by regulations of the SEC will neither be
included in the proxy statement or form of proxy, nor be considered at the
meeting. For a description of procedures for nominations to be submitted by
shareholders, see “Nominating Committee Matters.”
Our
Board
has established a procedure that enables shareholders to communicate in writing
with members of the Board. Any such communication should be addressed to the
Chairman of the Board of Center Bancorp and should be sent to such individual
c/o Center Bancorp, Inc., 2455 Morris Avenue, Union, New Jersey 07083. Any
such
communication must state, in a conspicuous manner, that it is intended for
distribution to the entire Board of Directors. Under the procedures established
by our Board, upon the Chairman's receipt of such a communication, our corporate
Secretary will send a copy of such communication to each member of our Board,
identifying it as a communication received from a shareholder. Absent unusual
circumstances, at the next regularly scheduled meeting of our Board held more
than two days after such communication has been distributed, our Board will
consider the substance of any such communication.
Our
Board
members are encouraged, but not required by any specific Board policy, to attend
Center Bancorp’s annual meeting of shareholders. All of the members of our Board
attended our 2007 annual meeting of shareholders.
OTHER
MATTERS
Our
Board
is not aware that any other matters are to be presented for action, but if
any
other matters properly come before the Annual Meeting, or any adjournments
thereof, the holder of any proxy is authorized to vote thereon at his or her
discretion.
A
copy of
the Annual Report of Center Bancorp and Union Center National Bank for the
year
ended December 31, 2007 is being mailed to shareholders with this proxy
statement. The Annual Report is not to be regarded as proxy soliciting material
or as a communication by means of which any solicitation is to be made.
A
COPY OF THE CORPORATION'S ANNUAL REPORT ON FORM 10-K FOR THE YEAR ENDED DECEMBER
31, 2007 (EXCLUDING EXHIBITS) WILL BE FURNISHED WITHOUT CHARGE TO ANY
SHAREHOLDER MAKING A WRITTEN REQUEST FOR THE SAME TO RICHARD ABRAHAMIAN, CHIEF
FINANCIAL OFFICER, CENTER BANCORP, INC., 2455 MORRIS AVENUE, UNION, NEW JERSEY
07083.
By
Order
of the Board of Directors
Anthony
C. Weagley
President
and Chief Executive Officer
Dated:
April 28, 2008
ANNEX
A
[note:
the following language is proposed to be inserted in the certificate of
incorporation]
Election
of Directors. At the 2008 annual meeting of shareholders of the Corporation,
the
successors of the directors whose terms expire at that meeting shall be elected
for a term expiring at the 2009 annual meeting of shareholders. At the 2009
annual meeting of shareholders of the Corporation, the successors of the
directors whose terms expire at that meeting shall be elected for a term
expiring at the 2010 annual meeting of shareholders. At the 2010 annual meeting
of shareholders of the Corporation, all directors shall be elected for a term
expiring at the 2011 annual meeting of shareholders. At each annual meeting
of
shareholders of the Corporation thereafter, the directors shall be elected
for
terms expiring at the next annual meeting of shareholders
[note:
the language quoted above is proposed to replace the following language
currently in the certificate of incorporation]
Classification
of Directors.
The
Board of Directors of the Corporation shall be divided into three classes,
the
respective terms of office of which shall end in successive years. The number
of
directors in each class shall be specified in the By-Laws and shall be as nearly
equal as possible. Unless they are elected to fill vacancies, the directors
in
each class shall be elected to hold office until the third successive annual
meeting of shareholders after their election and until their successors shall
have been elected and qualified. At each annual meeting of shareholders the
directors of only one class shall be elected, except directors who may be
elected to fill vacancies.
CENTER
BANCORP, INC.
Proxy
For
Annual Meeting of Shareholders
KNOW
ALL
MEN BY THESE PRESENTS, that I, the undersigned shareholder of Center Bancorp,
Inc., Union, New Jersey, do hereby constitute and appoint A. Richard
Abrahamian, Joseph D. Gangemi and Lori A. Wunder, or any one of them
(with full power to act alone), my true and lawful attorney(s) with full power
of substitution for me and in my name, place and stead to vote all of the common
stock of said corporation standing in my name on its books on April 15, 2008,
at
the annual meeting of shareholders to be held at the Park Ave Club, 184 Park
Ave, Florham Park, New Jersey 07932 on May 27, 2008 at 10:00 o'clock a.m. or
at
any adjournments thereof, with all powers the undersigned would possess if
personally present, as shown on the reverse side.
(See
Reverse Side)
Please
date, sign and mail your proxy card back as soon as possible!
Annual
Meeting of Shareholders - May 27, 2008
CENTER
BANCORP, INC.
/
/
Please mark your
votes
as
in this
example.
This
proxy is being solicited on behalf of the Board of Directors and may be revoked
prior to its exercise.
1.
Election of Directors for three year terms ending in 2011 (or one year terms
if
the shareholders approve the proposed amendment to the Certificate of
Incorporation of Center Bancorp).
Nominees:
James J. Kennedy, Howard Kent and Elliot I. Kramer
Instruction:
to withhold authority to vote for any individual nominee, write that nominee's
name in the space provided below:
_________________________________________________________
| Grant Authority |
|
Withhold Authority |
| for all nominees |
|
for all nominees |
|
/
/
|
|
/
/
|
2.
A
proposal to approve an amendment to Center Bancorp's Certificate of
Incorporation to eliminate the classified board.
FOR AGAINST ABSTAIN
/
/
/
/
/
/
3.
Other
Business - Whatever other business may be brought before the meeting or any
adjournment thereof.
If
any
other business is presented at said meeting, this proxy shall be voted in
accordance with the recommendations of management. Unless otherwise specified,
execution of this proxy will confer authority to the persons named herein as
proxies to vote shares in favor of the Board's nominees for directors.
Important:
To assure your representation at the meeting, please date, sign and mail this
proxy promptly in the envelope provided.
Note:
When signing as attorney, executor, administrator, trustee or guardian, please
give full titles. If more than one trustee, all should sign. All joint owners
should sign.
Signature:
___________________
Signature:___________________
Dated:
__________, 2008