Delaware
(State or Other Jurisdiction of Incorporation or Organization) |
6712
(Primary Standard Industrial Classification Code Number) |
Being Applied For
(I.R.S. Employer Identification Number) |
|
Large accelerated filer o | Accelerated filer x | ||
|
Non-accelerated filer o | Smaller reporting company o |
Proposed maximum | Proposed maximum | |||||||||||||||||||||
Title of each class of | Amount to be | offering price | aggregate | Amount of | ||||||||||||||||||
securities to be registered | registered | per share | offering price | registration fee | ||||||||||||||||||
Common Stock, $0.01 par value per share
|
69,282,277 shares | $ | 10.00 | $692,822,770(1) | $49,399 | |||||||||||||||||
Participation Interests
|
570,000 interests | (2) | ||||||||||||||||||||
(1) | Estimated solely for the purpose of calculating the registration fee. | |
(2) | The securities of Oritani Financial Corp. to be purchased by the Oritani Bank 401(k) Plan are included in the amount shown for common stock. However, pursuant to Rule 457(h) of the Securities Act of 1933, as amended, no separate fee is required for the participation interests. Pursuant to such rule, the amount being registered has been calculated on the basis of the number of shares of common stock that may be purchased with the current assets of such plan. |
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EX-1.1
EX-1.2
EX-3.1
EX-3.2
EX-4
EX-5
EX-8
EX-23.2
EX-23.3
EX-99.1
EX-99.2
EX-99.3
EX-99.4
EX-99.5
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portion of your order may be filled
(based on your purchase priority in
the event that the offering is
oversubscribed), all or a portion of
the amount that you have transferred
will be used to purchase stock units
in the stock offering. The stock
will be placed in the New Employer
Stock Fund and allocated to your Plan
account. Interest earned on your
account will be deposited into
, which you may
reinvest at your discretion.
In the event the offering is
cancelled or oversubscribed,
i.e.,
there are more orders for common
stock than shares available for sale
in the offering, and the trustee is
unable to use the full amount
allocated by you to purchase stock
units in the offering, the amount
that cannot be invested in stock
units, and any interest earned, will
be reinvested in the other investment
funds in accordance with your then
existing investment election (in
proportion to your investment
direction for future contributions).
If you choose not to direct the
investment of your account balances
towards the purchase of stock units
in the New Employer Stock Fund in
connection with the stock offering,
your account balances will remain in
the investment funds of the Plan as
previously directed by you.
All shares of Oritani Financial Corp.
held in the Plan upon consummation of
the conversion and offering (
i.e.
,
several weeks after the deadline for
submitting your Special Investment
Election Form), will automatically be
converted into shares of
OFC-Delaware, using the exchange
ratio set forth in the prospectus.
No fractional shares of OFC-Delaware
will be issued. Rather, cash equal
to the value of the fractional share
interest, using the $10.00 per share
offering purchase price per share,
will be paid to the holder. All
shares of Oritani Financial Corp.
that are converted to shares of
OFC-Delaware will be held in the Old
Employer Stock Fund and shares of
OFC-Delaware that are acquired during
the stock offering will be held in
the New Employer Stock Fund. Cash
for any fractional shares will be
credited to the
,
to be reinvested by you in your
discretion. As soon as practicable
after the closing of the stock
offering, the Old Employer Stock Fund
will be merged into the New Employer
Stock Fund.
The New Employer Stock Fund, which is
being established in the Plan, will
invest in stock units of the common
stock of OFC-Delaware. Following the
stock offering, the New Employer
Stock Fund will maintain a cash
component for liquidity purposes.
Liquidity is required in order to
facilitate daily transactions such as
investment transfers or distributions
from the New Employer Stock Fund.
For purchases in the offering, there
will be no cash
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component. A stock
unit will be valued at $10.00. After
the offering, newly issued stock
units will consist of a percentage
interest in both the common stock and
cash held in the New Employer Stock
Fund. Unit values (similar to the
stocks share price) and the number
of units (similar to number of
shares) will be used to communicate
the dollar value of a participants
account. Following the stock
offering, each day, the stock unit
value of the New Employer Stock Fund
will be determined by dividing the
total market value of the fund at the
end of the day by the total number of
units held in the fund by all
participants as of the previous days
end. The change in stock unit value
reflects the days change in stock
price, any cash dividends accrued and
the interest earned on the cash
component of the fund, less any
investment management fees. The
market value and unit holdings of
your account in the New Employer
Stock Fund will be reported to you on
your quarterly statements.
As of February 25, 2010, the market
value of the assets of the Plan was
approximately $5,700,000. The Plan
administrator informed each
participant of the value of his or
her account balance under the Plan as of
,
.
Enclosed is a Special Investment
Election Form on which you can elect
to transfer all or a portion of your
account balance in the Plan to the
New Employer Stock Fund for the
purchase of stock units in connection
with the stock offering (other than
amounts you currently have invested
in the Old Employer Stock Fund). If
you wish to use all or part of your
account balance in the Plan to
purchase stock units of common stock
issued in the offering (other than
amount you currently have invested in
the Old Employer Stock Fund), you
should indicate that decision on the
Special Investment Election Form.
If
you do not wish to purchase
OFC-Delaware common stock in the
offering through the Plan, you must
still fill out the Special Investment
Election Form and check the box for
No Election in Section D of the
form. The form is then to be
returned to
Anne E. Mooradian as
indicated on the Special investment
Election Form.
You can elect to transfer all or a
portion of each investment fund in
your account balance in the Plan
(other than amounts in the Old
Employer Stock Fund) to the New
Employer Stock Fund for the purchase
of stock units in the offering. This
is done by following the procedures
described below. Please note the
following stipulations concerning
this election:
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You are allowed only one election to
transfer funds to the New Employer
Stock Fund. Follow these steps to
make your election to use all or part
of your account balance in the Plan
to purchase stock units in the stock
offering:
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If you wish to purchase stock units
of common stock of OFC-Delaware with
all or part of your Plan account
balance, your Special Investment
Election Form must be received by
Anne E. Mooradian, Senior Vice
President and Human Resources
Officer, Oritani Bank, 370 Pascack
Road, Township of Washington, New
Jersey 07676, fax number (201)
497-1215, no later than
p.m.
Eastern Time on
,
, 2010. You may send
your Special Investment Election Form
by hand delivery, regular mail,
overnight delivery, or fax. If you have any questions
with respect to the Special
Investment Election Form, please
contact Anne Mooradian at (201) 664-5400, ext. 240.
You may not revoke your Special
Investment Election Form once it has
been delivered to Anne Mooradian.
You will, however, continue to have
the ability to transfer amounts not
directed towards the purchase of
stock units in the offering among all
of the other investment funds,
including the Old Employer Stock, on
a daily basis.
Whether or not you choose to purchase
stock units in the offering through
the Plan, you will at all times have
complete access to those amounts in
your account that you do
not
apply
towards purchases in the offering.
For example, you will be able to
purchase Oritani Financial Corp.
common stock through the Old Employer
Stock Fund and also invest in other
funds within the Plan with that
portion of your account balance that
you do not apply towards purchases in
the offering during the offering
period. Such purchases will be made
at the prevailing market price in the
same manner as you make such
purchases now,
i.e
., through
telephone transfers and internet
access to your account.
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After the offering, you will again
have complete access to any amounts
that you directed towards the
investment in the New Employer Stock
Fund during the offering period. You
may direct that your future
contributions or your account balance
in the Plan be transferred to the New
Employer Stock Fund. After the stock
offering, you will also have the
ability to sell all or a portion of
your interest in the New Employer
Stock Fund.
Special restrictions may apply to
transfers directed to and from the
New Employer Stock Fund by the
participants who are subject to the
provisions of Section 16(b) of the
Securities Exchange Act of 1934, as
amended, relating to the purchase and
sale of securities by officers,
directors and principal shareholders
of OFC-Delaware.
During the stock offering, the
trustee will pay $10.00 per share,
which will be the same price paid by
all other persons for a share of
OFC-Delaware common stock in the
stock offering.
After the stock offering, the trustee
of the Plan will acquire common stock
in open market transactions at the
prevailing price, which may be less
than or more than $10.00 per share.
The trustee will hold the common
stock, in trust, for the participants
of the Plan. Stock units acquired by
the trustee at your direction will be
allocated to your account.
Therefore, investment decisions of
other participants should not affect
the earnings allocated to your
account.
The Plan provides that you may direct
the trustee how to vote any shares of
OFC-Delaware Common Stock held by the
New Employer Stock Fund, and the
interest in such shares that is
credited to your account. If the
trustee does not receive your voting
instructions, the Plan administrator
will exercise these rights as it
determines in its discretion and will
direct the trustee accordingly. All
voting instructions will be kept
confidential.
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II-1
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International Stock Fund
Nasdaq 100 Stock Fund
Russell 2000 Stock Fund
S&P MidCap Stock Fund
S&P Growth Stock Fund
S&P Value Stock Fund
S&P 500 Stock Fund
US REIT Index Fund
Long Treasury Index Fund
Aggregate Bond Index Fund
Stable Value Fund
Short Term Investment Fund (Money Market Fund)
Income Plus Asset Allocation Fund
Growth & Income Asset Allocation Fund
Growth Asset Allocation Fund
Target Date Retirement 2015 Fund
Target Date Retirement 2025 Fund
Target Date Retirement 2035 Fund
Target Date Retirement 2045 Fund
Old Employer Stock Fund
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5 Calendar
10 Calendar
Monthly
Year to
Last 12
Years
Years
Return
Date
Months
Annualized
Annualized
1.37
%
31.39
%
31.39
%
3.08
%
0.33
%
5.21
%
53.86
%
53.86
%
2.44
%
-7.03
%
8.02
%
26.75
%
26.75
%
0.08
%
3.04
%
6.21
%
36.47
%
36.47
%
2.68
%
5.81
%
2.45
%
31.81
%
31.81
%
1.28
%
-3.29
%
1.70
%
20.53
%
20.53
%
-1.45
%
0.19
%
1.87
%
25.91
%
25.91
%
-0.14
%
-1.48
%
6.92
%
26.79
%
26.79
%
-0.99
n.a.
-5.66
%
-13.14
%
-13.14
%
4.91
%
7.31
%
-1.62
%
5.49
%
5.49
%
4.40
%
5.75
%
0.17
%
2.14
%
2.14
%
3.25
%
4.08
%
-0.01
%
0.13
%
0.13
%
2.92
%
2.82
%
-0.54
%
11.19
%
11.19
%
3.99
%
3.89
%
0.74
%
18.15
%
18.15
%
2.89
%
2.15
%
2.03
%
25.05
%
25.05
%
1.47
%
-0.37
%
0.26
%
17.04
%
17.04
%
n.a.
n.a.
1.13
%
20.67
%
20.67
%
n.a.
n.a.
2.10
%
25.75
%
25.75
%
n.a.
n.a.
2.21
%
26.27
%
26.27
%
n.a.
n.a.
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1
Prior to September 30, 1999, this Fund was limited to no more than 25% exposure to
Japan.
2
The Asset Allocation Funds and the International Stock Fund were first offered July 2,
1997. Returns prior to inception are simulated using the returns of market indices for, or
actual funds of, the Funds investment components, and are net of fees.
3
The Nasdaq 100 Stock Fund was first offered on May 1, 2002, while BGIs underlying
Nasdaq 100 Fund was initially offered on August 7, 2000. Returns shown for periods prior
to May 1, 2002 are based on returns of the then-existing BGI funds (when available), and on
the (hypothetical) returns of the Nasdaq 100 Index for periods prior to the inception date
of the BGI fund. All returns are net of fees.
4
The Russell 2000, S&P Growth and S&P Value Stock Funds were first offered on January 4,
2000. Returns prior to January 4, 2000 are hypothetical and are based on the returns of
the then-existing BGI funds, and are net of fees. Effective December 16, 2005, the S&P
500/Barra Growth and S&P 500/Barra Value indexes were reconstituted as the S&P
500/Citigroup Growth and S&P 500/Citigroup Value Indexes. Additional information can be
found at www.styleindices.standardandpoors.com.
5
The S&P MidCap, S&P 500, Long Treasury Index, and Short Term Investment Funds were
first offered on June 17, 1997. Results prior to that date are hypothetical, based on
previous investment returns of the then-existing BGI funds, and are net of fees.
6
The US REIT Index Fund was first offered on January 1, 2005. Returns shown for periods
prior to that date are hypothetical and are based on the returns of the then-existing BGI
fund for the MSCI US REIT Index, and are net of fees.
7
The Stable Value Fund is a separately managed account; historical return data
represents its actual performance.
8
The Asset Allocation Funds are designed investment vehicles utilizing various asset
classes represented by index funds and, under BGI management, were managed on an exclusive
basis. Only hypothetical results are available from January, 1992 to July 2, 1997 (the
inception date of the Asset Allocation Funds). Note that SSgA changed certain allocations
and underlying indexes (see fund descriptions for information on same).
9
The Aggregate Bond Index Fund became available effective April 30, 2006. Results prior
to that date are based on historical investment returns of the then-existing SSgA fund, and
are net of PSI fees which would have been levied.
10
The Target Retirement Funds became available effective August 1, 2007. Results prior
to that date are based on historical investment returns of the then-existing SSgA fund, and
are net of PSI fees which would have been levied.
11
The Government Short Term Investment Fund became available effective November 1, 2007.
Results prior to that date are based on historical investment returns of the then-existing
SSgA fund, and are net of all relevant fees which would have been levied.
12
The Treasury Inflation Protected Securities Fund became available effective October 1,
2009. Results prior to that date are based on historical investment returns on the
then-existing SSgA fund, and are net of all relevant fees which would have been levied.
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(Proposed Holding Company for Oritani Bank)
Up to 44,850,000 Shares of Common Stock
(Subject to Increase to up to 51,577,500 Shares)
Minimum
Midpoint
Maximum
Adjusted Maximum
33,150,000
39,000,000
44,850,000
51,577,500
$
331,500,000
$
390,000,000
$
448,500,000
$
515,775,000
$
1,762,400
$
1,762,400
$
1,762,400
$
1,762,400
$
11,368,400
$
13,334,000
$
15,299,600
$
17,560,040
$
318,369,200
$
374,903,600
$
431,438,000
$
496,452,560
$
9.60
$
9.61
$
9.62
$
9.63
(1)
For information regarding compensation to be received by Stifel, Nicolaus & Company,
Incorporated and the other broker-dealers that may participate in the syndicated community
offering, including the assumptions regarding the number of shares that may be sold in the
subscription and community offerings and the syndicated community offering to determine the
estimated offering expenses, see Pro Forma Data on page 45 and The Conversion and
OfferingMarketing Arrangements on page 157.
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F-1
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OF
ORITANI FINANCIAL CORP. AND SUBSIDIARIES
At
At June 30,
December
2009
2008
2007
2006
2005
31, 2009
(In thousands)
$
2,006,874
$
1,913,521
$
1,443,294
$
1,194,443
$
1,031,421
$
1,051,702
1,357,157
1,278,623
1,007,077
758,542
643,064
493,554
320,439
144,419
22,285
35,443
10,499
60,924
5,415
13,415
25,500
86,182
118,817
163,950
217,406
274,695
372,104
98,513
128,603
149,209
38,793
17,426
25,659
29,973
29,385
26,425
25,365
24,381
18,988
25,481
25,549
21,547
10,619
9,367
9,088
8,786
7,967
5,646
4,973
3,910
3,405
5,836
5,767
5,564
6,200
6,233
5,438
1,222
1,338
3,681
2,492
2,223
1,425
1,210,507
1,127,630
698,932
695,757
688,646
702,980
507,439
508,991
433,672
196,661
169,780
182,129
247,950
240,098
278,975
272,570
150,135
141,796
For the Three Months Ended
For the Six Months Ended
December 31,
December 31,
2009
2008
2009
2008
(Dollars in thousands, except per share amounts)
$
25,467
$
21,862
$
51,246
$
42,519
11,057
11,169
22,617
21,056
14,410
10,693
28,629
21,463
2,500
3,500
5,050
5,375
11,910
7,193
23,579
16,088
1,067
(565
)
3,613
668
8,166
6,542
14,994
12,416
4,811
86
12,198
4,340
1,882
47
4,786
1,795
$
2,929
$
39
$
7,412
$
2,545
$
0.08
$
0.00
$
0.20
$
0.07
$
0.08
$
0.00
$
0.20
$
0.07
Table of Contents
For the Year Ended June 30,
2009
2008
2007
2006
2005
$
88,429
$
71,591
$
63,349
$
51,276
$
46,439
44,500
37,208
32,829
23,522
18,349
43,929
34,383
30,520
27,754
28,090
9,880
4,650
1,210
1,500
800
34,049
29,733
29,310
26,254
27,290
2,780
4,936
5,309
4,560
1,663
27,257
19,491
25,249
17,524
14,800
9,572
15,178
9,370
13,290
14,153
4,020
6,218
(1,664
)
4,827
5,193
$
5,552
$
8,960
$
11,034
$
8,463
$
8,960
At or for the Six Months
Ended December 31,
(1)
At or For the Year Ended June 30,
2009
2008
2009
2008
2007
2006
2005
0.75
%
0.42
%
0.33
%
0.68
%
0.94
%
0.81
%
0.86
%
6.08
%
4.14
%
2.20
%
3.21
%
5.48
%
5.77
%
6.51
%
2.75
%
2.42
%
2.36
%
2.06
%
2.23
%
2.42
%
2.54
%
3.03
%
2.90
%
2.77
%
2.77
%
2.73
%
2.77
%
2.80
%
46.50
%
56.10
%
58.35
%
49.59
%
70.47
%
54.23
%
49.74
%
1.52
%
1.59
%
1.63
%
1.49
%
2.14
%
1.68
%
1.43
%
111.59
%
117.16
%
114.47
%
123.59
%
117.00
%
115.05
%
114.42
%
2.62
%
2.66
%
2.74
%
0.98
%
%
0.04
%
0.02
%
3.75
%
3.60
%
4.03
%
1.39
%
%
0.07
%
0.04
%
1.60
%
1.54
%
1.59
%
1.32
%
1.15
%
1.18
%
1.23
%
42.70
%
42.91
%
39.42
%
5.23
%
N/M
N/M
N/M
0.50
%
%
0.23
%
%
%
%
%
12.36
%
14.94
%
12.55
%
19.33
%
22.82
%
14.56
%
13.48
%
18.42
%
21.30
%
19.15
%
27.78
%
34.87
%
26.98
%
30.80
%
17.16
%
20.04
%
17.90
%
26.53
%
33.77
%
25.73
%
29.55
%
12.36
%
15.23
%
14.31
%
19.71
%
23.10
%
14.39
%
13.62
%
21
19
21
19
19
19
21
177
158
174
155
144
143
138
(1)
Ratios are annualized where appropriate.
(2)
Represents net income divided by average total assets.
(3)
Represents net income divided by average equity.
(4)
Represents average yield on interest-owning assets less average cost of interest-bearing
liabilities.
(5)
Represents net interest income as a percent of average interest-earning assets.
(6)
Represents non-interest expense divided by the sum of net interest income before provision
for loan losses and non-interest income.
(7)
Represents consolidated ratios.
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to support internal growth through lending and deposit gathering in the
communities we serve;
to enhance existing products and services, and support the development of
new products and services to support growth and enhanced customer service;
to improve the liquidity of our shares of common stock and stockholder
returns through higher earnings and more flexible capital management strategies;
to finance the acquisition of branches from other financial institutions
or build or lease new branch facilities primarily in, or adjacent to New Jersey,
although we do not currently have any agreements or understandings regarding any
specific acquisition transaction;
to finance the acquisition of financial institutions or other financial
service companies primarily in, or adjacent to New Jersey, although we do not currently
have any understandings or agreements regarding any specific acquisition transaction;
to maintain our capital position during a period of significant economic
uncertainty, especially for the financial services industry (although, as of December
31, 2009, Oritani Bank was considered well capitalized for regulatory purposes and is
not subject to any directive or recommendation from the Federal Deposit Insurance
Corporation (the FDIC) or the New Jersey Department of Banking and Insurance to raise
capital); and
to use the additional capital for other general corporate purposes.
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Company Name and Ticker Symbol
Exchange
Headquarters
Total Assets
(in millions)
NASDAQ
East Syracuse, NY
$
1,070
(1)
NASDAQ
Brookline, MA
$
2,616
NASDAQ
Danvers, MA
$
2,500
NASDAQ
Ellwood City, PA
$
1,979
(1)
NASDAQ
Stroudsburg, PA
$
1,034
NASDAQ
Toms River, NJ
$
1,989
NASDAQ
Monroeville, PA
$
1,916
NASDAQ
Montebello, NY
$
2,918
NASDAQ
West Springfield, MA
$
1,247
(1)
AMEX
Westfield, MA
$
1,191
(1)
As of September 30, 2009.
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Price-to-earnings multiple
Price-to-book
Price-to-tangible
(1)
value ratio
book value ratio
39.21
x
82.44
%
82.44
%
45.45
x
88.50
%
88.50
%
51.50
x
93.63
%
93.63
%
58.25
x
98.52
%
98.52
%
Valuation of peer
group companies, as
of
February 19, 2010
18.19
x
87.90
%
100.03
%
14.00
x
95.34
%
103.58
%
(1)
Information is derived from the RP Financial appraisal report and are based upon
estimated earnings for the twelve months ended December 31, 2009. These ratios are
different from the ratios in Pro Forma Data.
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New Shares to be
Total Shares of
New Shares That
Exchanged for Existing
Common Stock to be
Equivalent Per
Would be Received
New Shares to be Sold
Shares of Oritani
Outstanding After
Share Current
for 100 Existing
in This Offering
Financial Corp.
the Offering
Exchange Ratio
Market Value (1)
Shares
Amount
Percent
Amount
Percent
33,150,000
74.45
%
11,379,252
25.55
%
44,529,252
1.2022
$
12.02
120
39,000,000
74.45
%
13,387,355
25.55
%
52,387,355
1.4143
$
14.14
141
44,850,000
74.45
%
15,395,458
25.55
%
60,245,458
1.6264
$
16.26
162
51,577,500
74.45
%
17,704,777
25.55
%
69,282,277
1.8704
$
18.70
187
(1)
Represents the value of shares of Oritani common stock received in the conversion by a
holder of one share of Oritani Financial Corp. at the exchange ratio, assuming the market
price of $10.00 per share.
$215.7 million (50.0% of the net proceeds) will be invested in Oritani Bank;
$17.9 million (4.2% of the net proceeds) will be loaned by Oritani to the employee
stock ownership plan to fund its purchase of our shares of common stock; and
$197.8 million (45.8% of the net proceeds) will be retained by Oritani.
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Number of Shares to be Granted or Purchased (1)
Dilution Resulting
Value of Grants (2)
As a Percentage of
From Issuance of
(Dollars in thousands)
At Maximum as
Common Stock to be
Shares for
At Maximum as
At Minimum of
adjusted of
Sold in the
Stock-Based
At Minimum of
adjusted of Offering
Offering Range
Offering Range
Offering
Incentive Plans (3)
Offering Range
Range
1,326,000
2,063,100
4.0
%
%
$
13,260
$
20,631
1,326,000
2,063,100
(1)
4.0
2.89
13,260
20,631
3,315,000
5,157,750
(2)
10.0
6.93
11,370
17,691
5,967,000
9,283,950
18.0
%
9.44
%
$
37,890
$
58,953
(1)
The table assumes that the stock-based incentive plan is implemented twelve months or more
following the completion of the conversion and offering. If implemented within 12 months of
the completion of the conversion, the number of shares that may be reserved for grants of
restricted stock cannot exceed 4% of the total number of shares to be outstanding upon
completion of the conversion, less the number of shares of restricted stock (adjusted for the
exchange ratio) reserved under previously adopted benefit plans.
(2)
The table assumes that the stock-based incentive plan is implemented twelve months or more
following the completion of the conversion and offering. If implemented within 12 months of
the completion of the conversion, the number of shares that may be reserved for grants of
stock options cannot exceed 10% of the total number of shares to be outstanding upon
completion of the conversion, less the number of option shares (adjusted for the exchange
ratio) reserved under previously adopted benefit plans.
(3)
The actual value of restricted stock awards will be determined based on their fair value as
of the date grants are made. For purposes of this table, fair value for stock awards is
assumed to be the same as the offering price of $10.00 per share. The fair value of stock
options has been estimated at $3.43 per option using the Black-Scholes option pricing model
with the following assumptions: a grant-date share price
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and option exercise price of $10.00; an expected option life of ten years; a dividend yield of
3.0%; an interest rate of 3.85%; and a volatility rate of 36.45% based on an index of publicly
traded thrift institutions. The actual value of option grants will be determined by the
grant-date fair value of the options, which will depend on a number of factors, including the
valuation assumptions used in the option pricing model ultimately adopted.
(4)
Represents the dilution of stock ownership interest. No dilution is reflected for the
employee stock ownership plan because such shares are assumed to be purchased in the offering.
Percentage of
Shares Outstanding
E
xisting and New Stock-Based
Estimated Value of
After the
Incentive Plans
Participants
Shares
Shares
Conversion
(Dollars in thousands)
Employees
2,585,397
(1)
$
25,854
4.29
%
Employees
1,794,000
17,940
2.98
%
Employees
4,379,397
43,794
7.27
%
Directors, Officers and Employees
1,292,700
(2)
12,927
(3)
2.15
%
Directors, Officers and Employees
1,794,000
17,940
2.98
%
Directors, Officers and Employees
3,086,700
30,867
5.13
%
Directors, Officers and Employees
3,231,746
(4)
11,117
5.36
%
Directors, Officers and Employees
4,485,000
15,384
(5)
7.44
%
Directors, Officers and Employees
7,716,746
26,501
12.80
%
15,182,843
$
101,162
25.20
%
(1)
As of December 31, 2009, Oritani Financial Corp.s existing employee stock ownership plan
held 1,588,649 shares, 237,451 of which have been allocated.
(2)
Represents shares of restricted stock authorized for grant under our existing recognition and
retention plans.
(3)
The actual value of restricted stock awards will be determined based on their fair value as
of the date grants are made. For purposes of this table, fair value is assumed to be the same
as the offering price of $10.00 per share.
(4)
Represents shares authorized for grant under our existing stock option plans.
(5)
The fair value of stock options to be granted under the new stock-based incentive plan has
been estimated based on an index of publicly traded thrift institutions at $3.43 per option
using the Black-Scholes option pricing model with the following assumptions; exercise price,
$10.00; trading price on date of grant, $10.00; dividend yield, 3.0%; expected life, ten
years; expected volatility, 36.45%; and interest rate, 3.85%.
(6)
The number of shares of restricted stock and stock options set forth in the table would
exceed regulatory limits if a stock-based incentive plan was adopted within one year of the
completion of the conversion and offering. Accordingly, the number of new shares of
restricted
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stock and stock options set forth in the table would have to be reduced such that the aggregate
amount of outstanding stock awards would be 4.0% or less and outstanding stock options would be
10.0% or less, unless we obtain a waiver from the OTS, or we implement the incentive plan after
twelve months following the completion of the conversion and offering. Our current intention is
to implement a new stock-based incentive plan no earlier than twelve months after completion of
the conversion and offering.
2,063,100 Shares
1,362,000 Shares
1,560,000 Shares
1,794,000 Shares
Awarded at Maximum
Awarded at Minimum
Awarded at Midpoint
Awarded at Maximum
of Range, As
Share Price
of Range
of Range
of Range
Adjusted
(Dollars in thousands, except per share data)
$
10,608
$
12,480
$
14,352
$
16,505
13,260
15,600
17,940
20,631
15,912
18,720
21,528
24,757
18,564
21,840
25,116
28,883
3,900,000 Options
5,157,750 Options
Grant-Date Fair
3,315,000 Options
at Midpoint of
4,485,000 Options
at Maximum of
Exercise Price
Value Per Option
at Minimum of Range
Range
at Maximum of Range
Range, As Adjusted
(Dollars in thousands, except per share data))
$
2.74
$
9,083
$
10,686
$
12,289
$
14,132
3.43
11,370
13,377
15,384
17,691
4.12
13,658
16,068
18,478
21,250
4.80
15,912
18,720
21,528
24,757
your spouse or relatives of you or your spouse living in your house;
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companies, trusts or other entities in which you are a trustee, have a
controlling beneficial interest or hold a senior position; or
other persons who may be your associates or persons acting in concert with
you.
increase the purchase and ownership limitations; and/or
seek regulatory approval to extend the offering beyond [extension date],
provided that any such extension will require us to resolicit subscriptions received in
the offering.
The plan of conversion and reorganization is approved by at least
a
majority of votes eligible
to be cast by members of Oritani Financial Corp., MHC
(depositors of Oritani Bank) as of [depositor record date];
The plan of conversion and reorganization is approved by a vote of at
least
two-thirds of the outstanding shares
of common stock of Oritani Financial Corp.
as of [stockholder
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record date], including shares held by Oritani Financial Corp., MHC (because Oritani
Financial Corp., MHC owns 74.4% of the outstanding shares of Oritani Financial Corp.
common stock, we expect that Oritani Financial Corp., MHC and our directors and
executive officers will control the outcome of this vote);
The plan of conversion and reorganization is approved by a vote of at
least
a majority of the outstanding shares
of common stock of Oritani Financial Corp.
as of [stockholder record date], excluding those shares held by Oritani Financial
Corp., MHC;
We sell at least the minimum number of shares of common stock offered; and
We receive the final approval of the OTS to complete the conversion;
however, such approval does not constitute a recommendation or endorsement of the plan
of conversion and reorganization by that agency.
(i)
First, to depositors with accounts at Oritani Bank with aggregate balances of
at least $50.00 at the close of business on December 31, 2008.
(ii)
Second, to our tax-qualified employee benefit plans, including our employee
stock ownership plan and 401(k) plan, which will receive nontransferable subscription
rights to
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purchase in the aggregate up to 10.0% of the shares of common stock sold in the
offering. We expect our employee stock ownership plan to purchase up
to 4.0% of the shares of common stock sold in the offering.
(iii)
Third, to depositors with accounts at Oritani Bank with aggregate balances of
at least $50.00 at the close of business on [supplemental eligibility record date].
(iv)
Fourth, to depositors of Oritani Bank at the close of business on [depositor
record date].
(i)
personal check, bank check or money order made payable directly to Oritani
Bank; or
(ii)
authorizing us to withdraw funds from the types of Oritani Bank deposit
accounts designated on the stock order form.
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the interest income we earn on our interest-earning assets, such as loans and
securities; and
the interest expense we pay on our interest-bearing liabilities, such as
deposits and borrowings.
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Office of Thrift Supervision Regulations
.
OTS regulations prohibit, for
three years following the completion of a conversion, the direct or indirect
acquisition of more than 10.0% of any class of equity security of a savings institution
or holding company regulated by the OTS regulated holding company of a converted
institution without the prior approval of the OTS.
Certificate of incorporation and statutory provisions.
Provisions of the
certificate of incorporation and bylaws of Oritani and Delaware law may make it more
difficult and expensive to pursue a takeover attempt that management opposes, even if
the takeover is favored by a majority of our stockholders. These provisions also would
make it more difficult to remove our current Board of Directors or management, or to
elect new directors. Additional provisions include limitations on voting rights of
beneficial owners of more than 10.0% of our common stock, the election of directors to
staggered terms of three years and not permitting cumulative voting in the election of
directors. Our bylaws also contain provisions regarding the timing and content of
stockholder proposals and nominations and qualification for service on the Board of
Directors.
Issuance of stock options and restricted stock
.
We also intend to issue
stock options and shares of restricted stock to key employees and directors that will
require payments to these persons in the event of a change in control of Oritani.
These payments may have the effect of increasing the costs of acquiring Oritani,
thereby discouraging future takeover attempts.
Employment agreements
.
Oritani Financial Corp. has employment agreements
with each of its executive officers which will remain in effect following the stock
offering. These agreements may have the effect of increasing the costs of acquiring
Oritani, thereby discouraging future takeover attempts.
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At December
June 30,
31, 2009
2009
2008
2007
2006
2005
(In thousands)
$
2,006,874
$
1,913,521
$
1,443,294
$
1,194,443
$
1,031,421
$
1,051,702
1,357,157
1,278,623
1,007,077
758,542
643,064
493,554
320,439
144,419
22,285
35,443
10,499
60,924
5,415
13,415
25,500
86,182
118,817
163,950
217,406
274,695
372,104
98,513
128,603
149,209
38,793
17,426
25,659
29,973
29,385
26,425
25,365
24,381
18,988
25,481
25,549
21,547
10,619
9,367
9,088
8,786
7,967
5,646
4,973
3,910
3,405
5,836
5,767
5,564
6,200
6,233
5,438
1,222
1,338
3,681
2,492
2,223
1,425
1,210,507
1,127,630
698,932
695,757
688,646
702,980
507,439
508,991
433,672
196,661
169,780
182,129
247,950
240,098
278,975
272,570
150,135
141,796
For the Three Months Ended
For the Six Months Ended
December 31,
December 31,
2009
2008
2009
2008
(Dollars in thousands, except per share amounts)
$
25,467
$
21,862
$
51,246
$
42,519
11,057
11,169
22,617
21,056
14,410
10,693
28,629
21,463
2,500
3,500
5,050
5,375
11,910
7,193
23,579
16,088
1,067
(565
)
3,613
668
8,166
6,542
14,994
12,416
4,811
86
12,198
4,340
1,882
47
4,786
1,795
$
2,929
$
39
$
7,412
$
2,545
$
0.08
$
0.00
$
0.20
$
0.07
$
0.08
$
0.00
$
0.20
$
0.07
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For the Year Ended June 30,
2009
2008
2007
2006
2005
(In thousands)
$
88,429
$
71,591
$
63,349
$
51,276
$
46,439
44,500
37,208
32,829
23,522
18,349
43,929
34,383
30,520
27,754
28,090
9,880
4,650
1,210
1,500
800
34,049
29,733
29,310
26,254
27,290
2,780
4,936
5,309
4,560
1,663
27,257
19,491
25,249
17,524
14,800
9,572
15,178
9,370
13,290
14,153
4,020
6,218
(1,664
)
4,827
5,193
$
5,552
$
8,960
$
11,034
$
8,463
$
8,960
At or for the Six Months
Ended December 31,
(1)
At or For the Years Ended June 30,
2009
2008
2009
2008
2007
2006
2005
0.75
%
0.42
%
0.33
%
0.68
%
0.94
%
0.81
%
0.86
%
6.08
%
4.14
%
2.20
%
3.21
%
5.48
%
5.77
%
6.51
%
2.75
%
2.42
%
2.36
%
2.06
%
2.23
%
2.42
%
2.54
%
3.03
%
2.90
%
2.77
%
2.77
%
2.73
%
2.77
%
2.80
%
46.50
%
56.10
%
58.35
%
49.59
%
70.47
%
54.23
%
49.74
%
1.52
%
1.59
%
1.63
%
1.49
%
2.14
%
1.68
%
1.43
%
111.59
%
117.16
%
114.47
%
123.59
%
117.00
%
115.05
%
114.42
%
2.62
%
2.66
%
2.74
%
0.98
%
%
0.04
%
0.02
%
3.75
%
3.60
%
4.03
%
1.39
%
%
0.07
%
0.04
%
1.60
%
1.54
%
1.59
%
1.32
%
1.15
%
1.18
%
1.23
%
42.70
%
42.91
%
39.42
%
5.23
%
N/M
N/M
N/M
0.50
%
%
0.23
%
%
%
%
%
12.36
%
14.94
%
12.55
%
19.33
%
22.82
%
14.56
%
13.48
%
18.42
%
21.30
%
19.15
%
27.78
%
34.87
%
26.98
%
30.80
%
17.16
%
20.04
%
17.90
%
26.53
%
33.77
%
25.73
%
29.55
%
12.36
%
15.23
%
14.31
%
19.71
%
23.10
%
14.39
%
13.62
%
21
19
21
19
19
19
21
177
158
174
155
144
143
138
(1)
Ratios are annualized where appropriate.
(2)
Represents net income divided by average total assets.
(3)
Represents net income divided by average equity.
(4)
Represents average yield on interest-owning assets less average cost of interest-bearing
liabilities.
(5)
Represents net interest income as a percent of average interest-earning assets.
(6)
Represents non-interest expense divided by the sum of net interest income before provision for loan losses and non-interest income.
N/M
Not meaningful.
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statements of our goals, intentions and expectations;
statements regarding our business plans, prospects, growth and operating
strategies;
statements regarding the asset quality of our loan and investment
portfolios; and
estimates of our risks and future costs and benefits.
changes in laws or government regulations or policies affecting financial
institutions, including changes in regulatory fees and capital requirements;
general economic conditions, either nationally or in our market areas,
that are worse than expected;
competition among depository and other financial institutions;
inflation and changes in the interest rate environment that reduce our
margins or reduce the fair value of financial instruments;
adverse changes in the securities markets;
our ability to enter new markets successfully and capitalize on growth
opportunities;
our ability to successfully integrate acquired entities, if any;
changes in consumer spending, borrowing and savings habits;
changes in our organization, compensation and benefit plans;
our ability to continue to increase and manage our commercial and
residential real estate, multi-family, and commercial and industrial loans;
possible impairments of securities held by us, including those issued by
government entities and government sponsored enterprises;
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the level of future deposit premium assessments;
the impact of the current recession on our loan portfolio (including cash
flow and collateral values), investment portfolio, customers and capital market
activities;
the impact of the current governmental effort to restructure the U.S.
financial and regulatory system;
changes in the financial performance and/or condition of our borrowers;
and
the effect of changes in accounting policies and practices, as may be
adopted by the regulatory agencies, as well as the Securities and Exchange Commission,
the Public Company Accounting Oversight Board, the Financial Accounting Standards Board
and other accounting standard setters.
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Based Upon the Sale at $10.00 Per Share of
33,150,000 Shares
39,000,000 Shares
44,850,000 Shares
51,577,500 Shares (1)
Percent
Percent
Percent
Percent of
of Net
of Net
of Net
Net
Amount
Proceeds
Amount
Proceeds
Amount
Proceeds
Amount
Proceeds
(Dollars in thousands)
$
331,500
$
390,000
$
448,500
$
515,775
(13,131
)
(15,096
)
(17,062
)
(19,322
)
$
318,369
100.0
%
$
374,904
100.0
%
$
431,438
100.0
%
$
496,453
100.0
%
$
159,184
50.0
%
$
187,452
50.0
%
$
215,719
50.0
%
$
248,226
50.0
%
$
13,260
4.2
%
$
15,600
4.2
%
$
17,940
4.2
%
$
20,631
4.2
%
$
145,924
45.8
%
$
171,852
45.8
%
$
197,779
45.8
%
$
227,595
45.8
%
(1)
As adjusted to give effect to an increase in the number of shares which could occur due to a
15% increase in the offering range to reflect demand for the shares or changes in market or
general financial conditions following the commencement of the offering.
to support internal growth through lending and deposit gathering in the
communities we serve;
to enhance existing products and services, and support the development of
new products and services to support growth and enhanced customer service;
to improve the liquidity of our shares of common stock and stockholder
returns through higher earnings and more flexible capital management strategies;
to finance the acquisition of branches from other financial institutions
or build or lease new branch facilities primarily in, or adjacent to New Jersey,
although we do not currently have any agreements or understandings regarding any
specific acquisition transaction;
to finance the acquisition of financial institutions or other financial
service companies primarily in, or adjacent to New Jersey, although we do not currently
have any understandings or agreements regarding any specific acquisition transaction;
Table of Contents
to maintain our capital position during a period of significant economic
uncertainty, especially for the financial services industry (although, as of December
31, 2009, Oritani Bank was considered well capitalized for regulatory purposes and is
not subject to any directive or recommendation from the FDIC or the New Jersey
Department of Banking and Insurance to raise capital); and
to use the additional capital for other general corporate purposes.
Table of Contents
Table of Contents
Fiscal 2010
Dividends per
High
Low
share
$
14.61
$
12.75
$
0.050
14.50
12.46
0.075
Fiscal 2009
Fiscal 2008
Dividend per
Dividend per
High
Low
share
High
Low
share
$
20.12
$
15.50
$
$
15.93
$
12.55
$
17.33
13.25
17.23
12.17
17.04
9.56
15.25
10.78
15.10
12.73
0.05
17.15
14.87
Table of Contents
Oritani Bank Historical at
Pro Forma at December 31, 2009 Based Upon the Sale at $10.00 Per Share
December 31, 2009
33,150,000 Shares
39,000,000 Shares
44,850,000 Shares
51,577,500 Shares (1)
Amount
Percent of Assets (2)
Amount
Percent of Assets (2)
Amount
Percent of Assets (2)
Amount
Percent of Assets (2)
Amount
Percent
of Assets (2)
(Dollars in thousands)
$
194,340
9.84
%
$
327,213
15.33
%
$
350,801
16.22
%
$
374,388
17.08
%
$
401,513
18.05
%
$
193,183
9.76
%
$
326,056
15.25
%
$
349,644
16.14
%
$
373,231
17.01
%
$
400,356
17.98
%
79,144
4.00
%
85,512
4.00
%
86,642
4.00
%
87,773
4.00
%
89,073
4.00
%
$
114,039
5.76
%
$
240,544
11.25
%
$
263,002
12.14
%
$
285,458
13.01
%
$
311,283
13.98
%
$
193,183
13.49
%
$
326,056
22.27
%
$
349,644
23.79
%
$
373,231
25.29
%
$
400,356
27.01
%
85,943
6.00
%
87,854
6.00
%
88,193
6.00
%
88,532
6.00
%
88,922
6.00
%
$
107,240
7.49
%
$
238,201
16.27
%
$
261,451
17.79
%
$
284,699
19.29
%
$
311,434
21.01
%
$
211,236
14.75
%
$
344,109
23.50
%
$
367,697
25.02
%
$
391,284
26.52
%
$
418,409
28.23
%
114,591
8.00
%
117,138
8.00
%
117,590
8.00
%
118,043
8.00
%
118,563
8.00
%
$
96,645
6.75
%
$
226,971
15.50
%
$
250,107
17.02
%
$
273,241
18.52
%
$
299,846
20.23
%
$
159,184
$
187,452
$
215,719
$
248,226
(13,260
)
(15,600
)
(17,940
)
(20,631
)
(13,260
)
(15,600
)
(17,940
)
(20,631
)
209
209
209
209
$
132,873
$
156,461
$
180,048
$
207,173
(1)
As adjusted to give effect to an increase in the number of shares of common stock that
could occur due to a 15% increase in the offering range to reflect demand for the
shares, or changes in market or general financial conditions following the commencement
of the offering.
(2)
Tangible and core capital levels are shown as a percentage of total adjusted assets.
Risk-based capital levels are shown as a percentage of risk-weighted assets.
(3)
Although not adopted in regulation form, the New Jersey Department of Banking and Insurance
utilizes capital standards of 6% leverage capital and 8.0% risk-based capital. In addition,
the FDIC requires a Tier 1 risk-based capital ratio of 4.0% or greater.
(4)
Pro forma capital levels assume that we fund the stock-based incentive plans with purchases
in the open market equal to 4.0% of the shares of common stock sold in the stock offering at a
price equal to the price for which the shares of common stock are sold in the stock offering,
and that the employee stock ownership plan purchases 4.0% of the shares of common stock sold
in the stock offering with funds we lend. Pro forma GAAP and regulatory capital have been
reduced by the amount required to fund both of these plans. See Management for a discussion
of the stock-based incentive plan and employee stock ownership plan. We may award shares of
common stock under one or more stock-based incentive plans in excess of this amount if the
stock-based incentive plans are adopted more than one year following the stock offering.
(5)
Pro forma amounts and percentages assume net proceeds are invested in assets that carry a 20%
risk weighting.
Table of Contents
Oritani
Financial
Corp.
Oritani $10.00 Per Share Pro Forma Based on the Sale of
Historical at
33,150,000
39,000,000
44,850,000
51,577,500
December
31, 2009
Shares
Shares
Shares
Shares (1)
(Dollars in thousands)
$
1,210,507
$
1,210,507
$
1,210,507
$
1,210,507
$
1,210,507
507,439
507,439
507,439
507,439
507,439
$
1,717,946
$
1,717,946
$
1,717,946
$
1,717,946
$
1,717,946
130
445
524
602
693
132,339
450,393
506,849
563,305
628,229
182,528
182,528
182,528
182,528
182,528
209
209
209
209
1,114
1,114
1,114
1,114
1,114
(54,649
)
(54,649
)
(54,649
)
(54,649
)
(54,649
)
(13,512
)
(26,772
)
(29,112
)
(31,452
)
(34,143
)
(13,260
)
(15,600
)
(17,940
)
(20,631
)
$
247,950
$
540,008
$
591,863
$
643,717
$
703,350
44,529,252
52,387,355
60,245,458
69,282,277
11,379,252
13,387,355
15,395,458
17,704,777
33,150,000
39,000,000
44,850,000
51,577,500
12.36
%
23.49
%
25.18
%
26.79
%
28.57
%
12.36
%
23.49
%
25.18
%
26.79
%
28.57
%
(1)
As adjusted to give effect to an increase in the number of shares of common stock that could
occur due to a 15% increase in the offering range to reflect demand for the shares, or changes
in market or general financial conditions following the commencement of the offering.
(2)
Does not reflect withdrawals from deposit accounts for the purchase of shares of common stock
in the offering. These withdrawals would reduce pro forma deposits by the amount of the
withdrawals.
(3)
Oritani Financial Corp. currently has 10,000,000 authorized shares of preferred stock and
80,000,000 authorized shares of common stock, par value $0.01 per share. On a pro forma
basis, Oritani common stock and additional paid-in capital have been revised to reflect the
number of shares of Oritani common stock to be outstanding, which is 44,592,252 shares,
52,387,355 shares, 60,245,458 shares and 69,282,277 shares at the minimum, midpoint, maximum
and adjusted maximum of the offering range, respectively.
(4)
No effect has been given to the issuance of additional shares of Oritani common stock
pursuant to stock options to be granted under a stock-based incentive plan. If this plan is
implemented within one year of the completion of the offering, an amount up to 10.0% of the
shares of Oritani common stock sold in the offering will be reserved for issuance upon the
exercise of options. We may exceed this limit if the plan is implemented more than one year
following the completion of the offering. No effect has been given to the exercise of options
currently outstanding. See ManagementBenefits to be Considered Following Completion of the
Conversion.
(5)
The retained earnings of Oritani Bank will be substantially restricted after the conversion.
See The Conversion and OfferingLiquidation Rights and Supervision and Regulation.
(6)
Assumes that 4.0% of the shares sold in the offering will be acquired by the employee stock
ownership plan financed by a loan from Oritani The loan will have a term of 20 years and an
interest rate equal to the prime rate as published in
The Wall
Street Journal
, and be
repaid principally from Oritani Banks contributions to the employee stock ownership plan.
Since Oritani will finance the employee stock ownership plan debt, this debt will be
eliminated through consolidation and no liability will be reflected on Oritanis consolidated
financial statements. Accordingly, the amount of shares of common stock acquired by the
employee stock ownership plan is shown in this table as a reduction of total stockholders
equity.
(7)
Assumes at the minimum, midpoint, the maximum and the maximum as adjusted, of the offering
range that a number of shares of common stock equal to 4.0% of the shares of common stock to
be sold in the offering will be purchased by the stock-based incentive plan in open market
purchases. The stock-based incentive plan will be submitted to a vote of stockholders
following the completion of the offering. Our current intention is to implement a new
stock-based incentive plan no earlier than twelve months after completion of the conversion.
The funds to be used by the stock-based incentive plan to purchase the shares will be provided
by Oritani. The dollar amount of common stock to be purchased is based on the $10.00 per
share offering price and represents unearned compensation. This amount does not reflect
possible increases or decreases in the value of common stock relative to the subscription
price in the offering. As Oritani accrues compensation expense to reflect the vesting of
shares pursuant to the stock-based incentive plan, the credit to capital will be offset by a
charge to operations. Implementation of the stock-based incentive plan will require
stockholder approval.
Table of Contents
(i)
forty percent of all shares of common stock will be sold in the subscription
and community offerings, including shares purchased by insiders, with the remaining
shares to be sold in the syndicated community offering;
(ii)
150,000 shares of common stock will be purchased by our executive officers and
directors, and their associates;
(iii)
our employee stock ownership plan will purchase 4.0% of the shares of common
stock sold in the offering, with a loan from Oritani. The loan will be repaid in
substantially equal payments of principal and interest over a period of 20 years;
(iv)
Stifel, Nicolaus & Company, Incorporated will receive a fee equal to 1% of all
shares of common stock sold in the subscription and community offerings and a fee equal
to 5% of all shares sold in the syndicated community offering. No fee will be paid
with respect to shares of common stock purchased by our qualified and non-qualified
employee stock benefit plans, or stock purchased by our officers, directors and
employees, and their immediate families; and
(v)
total expenses of the offering, including the marketing fees to be paid to
Stifel, Nicolaus & Company, Incorporated, will be between $13.1 million at the minimum
of the offering range and $19.3 million at the maximum of the offering range, as
adjusted.
Table of Contents
withdrawals from deposit accounts for the purpose of purchasing shares of
common stock in the stock offering;
our results of operations after the stock offering; or
changes in the market price of the shares of common stock after the stock
offering.
Table of Contents
At or for the Six Months Ended December 31, 2009
Based Upon the Sale at $10.00 Per Share of
33,150,000
39,000,000
44,850,000
51,577,500
Shares
Shares
Shares
Shares (1)
(Dollars in thousands, except per share amounts)
$
331,500
$
390,000
$
448,500
$
515,775
113,793
133,874
153,955
177,048
$
445,293
$
523,874
$
602,455
$
692,823
$
331,500
$
390,000
$
448,500
$
515,775
(13,131
)
(15,096
)
(17,062
)
(19,322
)
$
209
$
209
$
209
$
209
$
318,578
$
375,113
$
431,647
$
496,662
(13,260
)
(15,600
)
(17,940
)
(20,631
)
(13,260
)
(15,600
)
(17,940
)
(20,631
)
$
292,058
$
343,913
$
395,767
$
455,400
$
7,412
$
7,412
$
7,412
$
7,412
2,395
2,820
3,246
3,735
(202
)
(238
)
(274
)
(315
)
(809
)
(952
)
(1,095
)
(1,259
)
(916
)
(1,077
)
(1,239
)
(1,424
)
$
7,880
$
7,966
$
8,051
$
8,150
$
0.17
$
0.14
$
0.12
$
0.11
0.05
0.06
0.06
0.05
(0.02
)
(0.02
)
(0.02
)
(0.02
)
(0.02
)
(0.02
)
(0.02
)
(0.02
)
$
0.18
$
0.16
$
0.14
$
0.12
27.78x
31.25x
35.71x
41.67x
43,236,402
50,866,355
58,496,308
67,270,754
$
247,950
$
247,950
$
247,950
$
247,950
318,369
374,904
431,438
496,453
209
209
209
209
(13,260
)
(15,600
)
(17,940
)
(20,631
)
(13,260
)
(15,600
)
(17,940
)
(20,631
)
$
540,008
$
591,863
$
643,717
$
703,350
$
5.57
$
4.73
$
4.11
$
3.58
7.15
7.16
7.16
7.17
0.01
0.01
0.01
0.01
(0.30
)
(0.30
)
(0.30
)
(0.30
)
(0.30
)
(0.30
)
(0.30
)
(0.30
)
$
12.13
$
11.30
$
10.68
$
10.15
82.44
%
88.50
%
93.63
%
98.52
%
82.44
%
88.50
%
93.63
%
98.52
%
44,529,252
52,387,355
60,245,458
69,282,277
Table of Contents
(1)
As adjusted to give effect to an increase in the number of shares that could occur due to a
15% increase in the offering range to reflect demand for the shares, or changes in market or
financial conditions following the commencement of the offering.
(2)
Assumes that 4.0% of shares of common stock sold in the offering will be purchased by the
employee stock ownership plan. For purposes of this table, the funds used to acquire these
shares are assumed to have been borrowed by the employee stock ownership plan from Oritani.
The loan will have a term of 20 years and an interest rate equal to the prime rate as
published in
The Wall Street Journal
. Oritani Bank intends to make annual contributions to
the employee stock ownership plan in an amount at least equal to the required principal and
interest payments on the debt. Oritani Banks total annual payments on the employee stock
ownership plan debt are based upon 20 equal annual installments of principal and interest.
Statement of Position 93-6, Employers Accounting for Employee Stock Ownership Plans (SOP
93-6), requires that an employer record compensation expense in an amount equal to the fair
value of the shares committed to be released to employees. The pro forma adjustments assume
that: (i) the employee stock ownership plan shares are allocated in equal annual installments
based on the number of loan repayment installments assumed to be paid by Oritani Bank, (ii)
the fair value of the common stock remains equal to the $10.00 subscription price; and (iii)
the employee stock ownership plan expense reflects an effective combined federal and state tax
rate of 39.0%. The unallocated employee stock ownership plan shares are reflected as a
reduction of stockholders equity. No reinvestment is assumed on proceeds contributed to fund
the employee stock ownership plan. The pro forma net income further assumes that 33,150,
39,000, 44,850 and 51,578 shares were committed to be released during the period at the
minimum, midpoint, maximum, and adjusted maximum of the offering range, respectively, and in
accordance with SOP 93-6, only the employee stock ownership plan shares committed to be
released during the period were considered outstanding for purposes of net income per share
calculations.
(3)
Gives effect to the grant of restricted stock awards pursuant to the stock-based incentive
plan expected to be adopted by following the offering and presented to stockholders for
approval not earlier than twelve months after the completion of the offering. We have assumed
that at the minimum, midpoint, maximum and maximum as adjusted, of the offering range this
plan acquires a number of shares of restricted common stock equal to 4.0% of the shares sold
in the offering, either through open market purchases, from authorized but unissued shares of
common stock or treasury stock. Funds used by the stock-based incentive plan to purchase the
shares of common stock will be contributed by Oritani. In calculating the pro forma effect of
the stock-based incentive plan, it is assumed that the shares of restricted stock were
acquired by the plan in open market purchases at the beginning of the period presented for a
purchase price equal to the price for which the shares are sold in the offering, and that
10.0% of the amount contributed was an amortized expense (20.0% annually based upon a
five-year vesting period) during the six months ended December 31, 2009. There can be no
assurance that the actual purchase price of the shares of common stock granted under the
stock-based incentive plan will be equal to the $10.00 subscription price. If shares are
acquired from authorized but unissued shares of common stock or from treasury shares, our net
income per share and stockholders equity per share will decrease. This will also have a
dilutive effect of approximately 2.89% (at the maximum of the offering range) on the ownership
interest of stockholders. The impact on pro forma net income per share and pro forma
stockholders equity per share is not material.
(4)
Gives effect to the granting of options pursuant to the stock-based incentive plan, which is
expected to be adopted by Oritani following the offering and presented to stockholders for
approval not earlier than twelve months after the completion of the offering. We have assumed
that options will be granted to acquire shares of common stock equal to 10.0% of the shares
sold in the offering. In calculating the pro forma effect of the stock options, it is assumed
that the exercise price of the stock options and the trading price of the stock at the date of
grant were $10.00 per share, and the estimated grant-date fair value pursuant to the
application of the Black-Scholes option pricing model was $3.43 for each option. The pro
forma net income assumes that the options granted under the stock-based incentive plan have a
value of $3.43 per option, which was determined using the Black-Scholes option pricing formula
using the following assumptions: (i) the trading price on date of grant was $10.00 per share;
(ii) exercise price is equal to the trading price on the date of grant; (iii) dividend yield
of 3.0%; (iv) expected life of ten years; (v) expected volatility of 36.45%; (vi) risk-free
interest rate of 3.85%, and (vii) 50% of the options awarded are non-qualified options. If
the fair market value per share on the date of grant is different than $10.00, or if the
assumptions used in the option pricing formula are different from those used in preparing this
pro forma data, the value of options and the related expense recognized will be different.
The aggregate grant date fair value of the stock options was amortized to expense on a
straight-line basis over a five-year vesting period of the options. There can be no assurance
that the actual exercise price of the stock options will be equal to the $10.00 price per
share. If a portion of the shares to satisfy the exercise of options under the stock-based
incentive plan is obtained from the issuance of authorized but unissued shares of common
stock, our net income and stockholders equity per share will decrease. This also will have a
dilutive effect of up to 6.93% on the ownership interest of persons who purchase shares of
common stock in the offering.
(5)
The number of shares used to calculate pro forma net income per share is equal to the total
number of shares to be outstanding upon completion of the offering, and subtracting the
employee stock ownership plan shares which have not been committed for release during the
period in accordance with SOP 93-6. See footnote 2, above.
(6)
The retained earnings of Oritani Bank will be substantially restricted after the conversion.
See Our Policy Regarding Dividends, The Conversion and OfferingLiquidation Rights and
Supervision and Regulation.
(7)
Per share figures include publicly held shares of Oritani Financial Corp. common stock that
will be exchanged for shares of Oritani common stock in the conversion. Stockholders equity
per share calculations are based upon the sum of (i) the number of subscription shares assumed
to be sold in the offering; and (ii) shares to be issued in exchange for publicly held shares.
(8)
The number of shares used to calculate pro forma stockholders equity per share is equal to
the total number of shares to be outstanding upon completion of the offering.
Table of Contents
At or for the Year Ended June 30, 2009
Based Upon the Sale at $10.00 Per Share of
33,150,000
39,000,000
44,850,000
51,577,500
Shares
Shares
Shares
Shares (1)
(Dollars in thousands, except per share amounts)
$
331,500
$
390,000
$
448,500
$
515,775
113,793
133,874
153,955
177,048
$
445,293
$
523,874
$
602,455
$
692,823
$
331,500
$
390,000
$
448,500
$
515,775
(13,131
)
(15,096
)
(17,062
)
(19,322
)
209
209
209
209
$
318,578
$
375,113
$
431,647
$
496,662
(13,260
)
(15,600
)
(17,940
)
(20,631
)
(13,260
)
(15,600
)
(17,940
)
(20,631
)
$
292,058
$
343,913
$
395,767
$
455,400
$
5,552
$
5,552
$
5,552
$
5,552
4,522
5,325
6,129
7,053
(404
)
(476
)
(547
)
(629
)
(1,618
)
(1,903
)
(2,189
)
(2,517
)
(1,831
)
(2,154
)
(2,477
)
(2,848
)
$
6,221
$
6,344
$
6,468
$
6,611
$
0.13
$
0.11
$
0.10
$
0.08
0.10
0.10
0.10
0.11
(0.01
)
(0.01
)
(0.01
)
(0.01
)
(0.04
)
(0.04
)
(0.04
)
(0.04
)
(0.04
)
(0.04
)
(0.04
)
(0.04
)
$
0.14
$
0.12
$
0.11
$
0.10
71.43x
83.33x
90.91x
100.00x
42,269,552
50,905,355
58,541,158
67,322,332
$
240,098
$
240,098
$
240,098
$
240,098
318,369
374,904
431,438
496,453
209
209
209
209
(13,260
)
(15,600
)
(17,940
)
(20,631
)
(13,260
)
(15,600
)
(17,940
)
(20,631
)
$
532,156
$
584,011
$
635,865
$
695,498
$
5.39
$
4.58
$
3.98
$
3.46
7.15
7.16
7.16
7.17
0.01
0.01
0.01
0.01
(0.30
)
(0.30
)
(0.30
)
(0.30
)
(0.30
)
(0.30
)
(0.30
)
(0.30
)
$
11.95
$
11.15
$
10.55
$
10.04
83.68
%
89.69
%
94.79
%
99.60
%
53.68
%
89.69
%
94.79
%
99.60
%
44,529,252
52,387,355
60,245,458
69,282,277
Table of Contents
(1)
As adjusted to give effect to an increase in the number of shares that could occur due to a
15% increase in the offering range to reflect demand for the shares, or changes in market and
financial conditions following the commencement of the offering.
(2)
Assumes that 4.0% of shares of common stock sold in the offering will be purchased by the
employee stock ownership plan. For purposes of this table, the funds used to acquire
these shares are assumed to have been borrowed by the employee stock ownership plan from
Oritani. The loan will have a term of 20 years and an interest rate equal to the prime
rate as published in
The Wall Street Journal
. Oritani Bank intends to make annual
contributions to the employee stock ownership plan in an amount at least equal to the
required principal and interest payments on the debt. Oritani Banks total annual
payments on the employee stock ownership plan debt are based upon 20 equal annual
installments of principal and interest. SOP 93-6 requires that an employer record
compensation expense in an amount equal to the fair value of the shares committed to be
released to employees. The pro forma adjustments assume that: (i) the employee stock
ownership plan shares are allocated in equal annual installments based on the number of
loan repayment installments assumed to be paid by Oritani Bank; (ii) the fair value of the
common stock remains equal to the $10.00 subscription price and (iii) the employee stock
ownership plan expense reflects an effective combined federal and state tax rate of 39%.
The unallocated employee stock ownership plan shares are reflected as a reduction of
stockholders equity. No reinvestment is assumed on proceeds contributed to fund the
employee stock ownership plan. The pro forma net income further assumes that 66,300,
78,000, 89,700 and 103,155 shares were committed to be released during the year at the
minimum, midpoint, maximum, and adjusted maximum of the offering range, respectively, and
in accordance with SOP 93-6, only the employee stock ownership plan shares committed to be
released during the year were considered outstanding for purposes of net income per share
calculations.
(3)
Gives effect to the grant of restricted stock awards pursuant to the stock-based
incentive plan expected to be adopted by following the offering and presented to
stockholders for approval not earlier than six months after the completion of the
offering. We have assumed that at the midpoint, maximum and maximum as adjusted, of the
offering range this plan acquires a number of shares of restricted common stock equal to
4.0% of the shares sold in the stock offering, either through open market purchases, from
authorized but unissued shares of common stock or treasury stock. Funds used by the
stock-based incentive plan to purchase the shares of restricted stock will be contributed
by Oritani. In calculating the pro forma effect of the stock-based incentive plan, it is
assumed that the shares of common stock were acquired by the plan in open market purchases
at the beginning of the period presented for a purchase price equal to the price for which
the shares are sold in the offering, and that 20.0% of the amount contributed was an
amortized expense (based upon a five-year vesting period) during the year ended June 30,
2009. There can be no assurance that the actual purchase price of the shares of common
stock granted under the stock-based incentive plan will be equal to the $10.00
subscription price. If shares are acquired from authorized but unissued shares of common
stock or from treasury shares, our net income per share and stockholders equity per share
will decrease. This will also have a dilutive effect of approximately 2.89% (at the
maximum of the offering range) on the ownership interest of stockholders. The impact on
pro forma net income per share and pro forma stockholders equity per share is not
material.
(4)
Gives effect to the granting of options pursuant to the stock-based incentive plan, which is
expected to be adopted by following the offering and presented to stockholders for approval
not earlier than twelve months after the completion of the offering. We have assumed that
options will be granted to acquire shares of common stock equal to 10.0% of the shares sold in
the offering. In calculating the pro forma effect of the stock options, it is assumed that
the exercise price of the stock options and the trading price of the stock at the date of
grant were $10.00 per share, and the estimated grant date fair value pursuant to the
application of the Black-Scholes option pricing model was $3.43 for each option. The pro
forma net income assumes that the options granted under the stock-based incentive plan have a
value of $3.43 per option, which was determined using the Black-Scholes option pricing formula
using the following assumptions: (i) the trading price on date of grant was $10.00 per share;
(ii) exercise price is equal to the trading price on the date of grant; (iii) dividend yield
of 3.00%; (iv) expected life of ten years; (v) expected volatility of 36.45%; (vi) risk-free
interest rate of 3.85%, and (vii) 50% of the options awarded are non-qualified options. If
the fair market value per share on the date of grant is different than $10.00, or if the
assumptions used in the option pricing formula are different from those used in preparing this
pro forma data, the value of options and the related expense recognized will be different.
The aggregate grant-date fair value of the stock options was amortized to expense on a
straight-line basis over a five-year vesting period of the options. There can be no assurance
that the actual exercise price of the stock options will be equal to the $10.00 price per
share. If a portion of the shares to satisfy the exercise of options under the stock-based
incentive plan is obtained from the issuance of authorized but unissued shares of common
stock, our net income and stockholders equity per share will decrease. This also will have a
dilutive effect of up to 6.93% on the ownership interest of persons who purchase shares of
common stock in the offering.
(5)
The number of shares used to calculate pro forma net income per share is equal to the total
number of shares to be outstanding upon completion of the offering, and subtracting the
employee stock ownership plan shares which have not been committed for release during the
period in accordance with SOP 93-6. See footnote 2, above.
(6)
The retained earnings of Oritani Bank will be substantially restricted after the conversion.
See Our Policy Regarding Dividends, The Conversion and OfferingLiquidation Rights and
Supervision and Regulation.
(7)
Per share figures include publicly held shares of Oritani Financial Corp. common stock that
will be exchanged for shares of Oritani common stock in the conversion. Stockholders equity
per share calculations are based upon the sum of (i) the number of subscription shares assumed
to be sold in the offering; and (ii) shares to be issued in exchange for publicly held shares.
The number of subscription shares actually sold and the corresponding number of exchange
shares may be more or less than the assumed amounts.
(8)
The number of shares used to calculate pro forma stockholders equity per share is equal
to the total number of shares to be outstanding upon completion of the offering.
Table of Contents
AND RESULTS OF OPERATIONS
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Table of Contents
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December 31, 2009
September 30, 2009
June 30, 2009
March 31, 2009
December 31, 2008
(Dollars in thousands)
$
9,613
$
14,318
$
6,727
$
4,897
4,979
1,974
1,049
17,825
2,130
5,942
51,907
52,557
52,465
52,260
44,067
$
63,494
$
67,924
$
77,017
$
59,287
$
54,988
Table of Contents
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Delinquency Totals
June 30, 2009
June 30, 2008
June 30, 2007
(In thousands)
$
6,727
$
27,985
$
555
17,825
18
39
47,839
13,876
$
72,391
$
41,879
$
594
Table of Contents
Table of Contents
June 30, 2008
June 30, 2007
(In thousands)
$
27,985
$
555
18
39
13,876
$
41,879
$
594
Table of Contents
Table of Contents
For the Six Months Ended (unaudited)
December 31, 2009
December 31, 2008
Average
Average
Average
Outstanding
Interest
Yield/
Average
Interest
Yield/
Balance
Earned/Paid
Rate
Outstanding Balance
Earned/Paid
Rate
(Dollars in thousands)
$
1,336,861
$
42,065
6.29
%
$
1,123,438
$
34,645
6.17
%
25,513
717
5.62
24,646
535
4.34
260,372
3,738
2.87
29,035
633
4.36
103,686
1,918
3.70
153,587
3,032
3.95
117,249
2,718
4.64
149,065
3,673
4.93
48,471
90
0.37
258
1
0.78
1,892,152
51,246
5.42
1,480,029
42,519
5.75
%
86,387
77,036
$
1,978,539
$
1,557,065
$
146,313
675
0.92
%
$
144,709
1,069
1.48
%
237,403
2,008
1.69
70,882
1,076
3.04
101,795
404
0.79
75,084
323
0.86
702,046
9,036
2.57
470,220
8,648
3.68
1,187,557
12,123
2.04
760,895
11,116
2.92
508,145
10,494
4.13
502,393
9,940
3.96
1,695,702
22,617
2.67
%
1,263,288
21,056
3.33
%
39,125
32,051
1,734,827
1,295,339
243,712
261,726
$
1,978,539
$
1,557,065
$
28,629
$
21,463
2.75
%
2.42
%
$
196,450
$
216,741
3.03
%
2.90
%
111.59
%
117.16
%
(1)
Includes nonaccrual loans.
(2)
Includes FHLB Stock.
(3)
Net interest rate spread represents the difference between the yield on average
interest-earning assets and the cost of average interest-bearing liabilities.
(4)
Net interest-earning assets represents total interest-earning assets less total
interest-bearing liabilities.
(5)
Net interest margin represents net interest income divided by average total interest-earning
assets.
Table of Contents
For the Years Ended June 30,
2009
2008
2007
Average
Average
Average
Outstanding
Yield/
Outstanding
Yield/
Outstanding
Yield/
Balance
Interest
Rate
Balance
Interest
Rate
Balance
Interest
Rate
(Dollars in thousands)
$
1,181,385
$
72,158
6.11
%
$
858,223
$
55,053
6.41
%
$
693,902
$
44,278
6.38
%
67,479
2,468
3.66
34,464
1,716
4.98
15,789
868
5.50
24,937
1,069
4.29
19,192
999
5.21
19,093
1,073
5.62
145,713
7,046
4.84
91,060
4,710
5.17
16,147
813
5.03
142,484
5,615
3.94
192,007
7,409
3.86
245,625
9,475
3.86
25,021
73
0.29
45,292
1,704
3.76
127,215
6,842
5.38
1,587,019
88,429
5.57
1,240,238
71,591
5.77
1,117,771
63,349
5.67
%
84,535
69,806
62,293
$
1,671,554
$
1,310,044
$
1,180,064
$
144,810
1,979
1.37
%
$
151,068
2,427
1.61
%
$
211,397
3,093
1.46
%
103,932
2,626
2.53
50,263
1,730
3.44
32,673
1,195
3.66
75,324
628
0.83
71,176
812
1.14
75,153
868
1.15
556,730
19,029
3.42
420,787
18,896
4.49
425,563
18,526
4.35
880,796
24,262
2.75
693,294
23,865
3.44
744,786
23,682
3.18
505,599
20,238
4.00
310,231
13,343
4.30
210,598
9,147
4.34
1,386,395
44,500
3.21
%
1,003,525
37,208
3.71
%
955,384
32,829
3.44
%
33,071
27,438
23,319
1,419,466
1,030,963
978,703
252,088
279,081
201,361
$
1,671,554
$
1,310,044
$
1,180,064
$
43,929
$
34,383
$
30,520
2.36
%
2.06
%
2.23
%
$
200,624
$
236,713
$
162,387
2.77
%
2.77
%
2.73
%
114.47
%
123.59
%
117.00
%
(1)
Includes nonaccrual loans.
(2)
Net interest rate spread represents the difference between the weighted-average yield on
interest-earning assets and the weighted- average cost of interest-bearing liabilities for the
period.
(3)
Net interest-earning assets represents total interest-earning assets less interest-bearing
liabilities.
(4)
Net interest margin represents net interest income as a percent of average interest-earning
assets for the period.
Table of Contents
Six Months Ended December 31,
Years Ended June 30,
Years Ended June 30,
2009 vs. 2008
2009 vs. 2008
2008 vs. 2007
Increase (Decrease)
Total
Increase (Decrease)
Total
Increase (Decrease) Due
Total
Due to
Increase
Due to
Increase
to
Increase
Volume
Rate
(Decrease)
Volume
Rate
(Decrease)
Volume
Rate
(Decrease)
(In thousands)
$
6,582
$
838
$
7,420
$
20,730
$
(3,625
)
$
17,105
$
10,485
$
290
$
10,775
5,043
(1,938
)
3,105
1,644
(892
)
752
1,027
(179
)
848
19
163
182
299
(229
)
70
6
(80
)
(74
)
(784
)
(171
)
(955
)
2,827
(491
)
2,336
3,772
125
3,897
(985
)
(129
)
(1,114
)
(1,911
)
117
(1,794
)
(2,068
)
2
(2,066
)
187
(98
)
89
(763
)
(868
)
(1,631
)
(4,406
)
(732
)
(5,138
)
10,062
(1,335
)
8,727
22,826
(5,988
)
16,838
8,816
(574
)
8,242
12
(406
)
(394
)
(101
)
(347
)
(448
)
(883
)
217
(666
)
2,528
(1,596
932
1,847
(951
)
896
643
(108
)
535
115
(34
)
81
47
(231
)
(184
)
(46
)
(10
)
(56
)
4,264
(3,876
)
388
6,105
(5,972
)
133
(208
)
578
370
6,918
(5,911
)
1,007
7,898
(7,501
)
397
(494
)
677
183
114
440
554
8,403
(1,508
)
6,895
4,327
(131
)
4,196
7,032
(5,471
)
1,561
16,301
(9,009
)
7,292
3,833
546
4,379
$
3,030
$
4,136
$
7,166
$
6,525
$
3,021
$
9,546
$
4,983
$
(1,120
)
$
3,863
Table of Contents
(i)
originating multi-family and commercial real estate loans that generally tend
to have shorter interest duration and generally reset at five years;
(ii)
investing in shorter duration securities and mortgage-backed securities; and
(iii)
obtaining general financing through FHLB advances with either a fixed long
term or with call options that are considered unlikely.
Table of Contents
NPV as a Percentage of Present
Estimated Increase
Value of Assets (3)
(Decrease) in
Increase
Change in Interest
Estimated
NPV
(Decrease)
Rates (basis points) (1)
NPV (2)
Amount
Percent
NPV Ratio (4)
(basis points)
(Dollars in thousands)
203,351
(53,593
)
(20.86
)%
10.59
%
(209
)
256,944
12.68
278,886
21,942
8.54
13.42
74
(1)
Assumes an instantaneous uniform change in interest rates at all maturities.
(2)
NPV is the discounted present value of expected cash flows from assets,
liabilities and off-balance sheet contracts.
(3)
Present value of assets represents the discounted present value of incoming
cash flows on interest-earning assets.
(4)
NPV Ratio represents NPV divided by the present value of assets.
expected loan demand;
expected deposit flows;
Table of Contents
expected payments from the loan and investment portfolios;
funds available through borrowings;
yields available on interest-earning deposits and securities;
yields and structures available on alternate investments; and
the objectives of our asset/liability management program
Table of Contents
Actual
Required
Amount
Ratio
Amount
Ratio
$
209,882
15.8
%
$
106,101
8.0
%
193,248
14.6
53,050
4.0
193,248
10.6
72,963
4.0
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Payments Due by Period
Less than
More than
Contractual Obligations
One Year
One to Three Years
Three to Five Years
Five Years
Total
(In thousands)
$
10,341
$
56,413
$
130,685
$
310,000
$
507,439
289
546
375
370
1,580
$
10,630
$
56,959
$
131,060
$
310,370
$
509,019
$
49,888
$
$
1,700
$
$
47,588
$
27,722
$
$
$
$
27,722
$
34,673
$
$
$
$
34,673
$
15,000
$
$
$
$
15,000
Payments Due by Period
Less than
More than
Contractual Obligations
One Year
One to Three Years
Three to Five Years
Five Years
Total
(In thousands)
$
10,372
$
57,934
$
110,685
$
330,000
$
508,991
289
570
418
448
1,725
$
10,661
$
58,504
$
111,103
$
330,448
$
510,716
$
77,729
$
$
$
$
77,729
$
39,708
$
$
$
$
39,708
$
33,800
$
$
$
$
33,800
$
20,000
$
$
$
$
20,000
Table of Contents
Table of Contents
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At December 31,
At June 30,
2009
2009
2008
2007
2006
2005
Amount
Percent
Amount
Percent
Amount
Percent
Amount
Percent
Amount
Percent
Amount
Percent
(Dollars in thousands)
$
260,056
18.8
%
$
265,962
20.4
%
$
223,087
21.8
%
$
188,941
24.6
%
$
165,070
25.3
%
$
147,284
29.4
%
296,314
21.4
277,589
21.3
237,490
23.2
210,587
27.4
205,351
31.5
183,118
36.5
628,507
45.5
562,139
43.2
359,681
35.2
240,544
31.3
173,857
26.6
88,306
17.6
51,036
3.7
54,768
4.2
59,886
5.8
65,240
8.5
66,198
10.2
55,672
11.1
124,898
9.0
130,831
10.0
138,195
13.5
62,704
8.1
38,722
5.9
24,629
4.9
21,612
1.6
10,993
0.8
4,880
0.5
1,140
0.1
3,291
0.5
2,321
0.5
1,382,423
100.0
%
1,302,282
100.0
%
1,023,219
100.0
%
769,156
100.0
%
652,489
100.0
%
501,330
100.0
%
3,102
2,979
2,610
1,732
1,753
1,604
22,164
20,680
13,532
8,882
7,672
6,172
$
1,357,157
$
1,278,623
$
1,007,077
$
758,542
$
643,064
$
493,554
First Mortgage
Second Mortgage
Construction and Land
Other Loans
Total
Weighted Average
Amount
Rate
Amount
Percent
Amount
Percent
Amount
Percent
Amount
Percent
(Dollars in thousands)
$
6,500
6.92
%
$
89
5.04
%
$
103,885
7.21
%
$
7,989
3.87
%
$
118,463
6.97
%
6,140
6.54
340
5.25
24,011
5.41
1,581
6.93
32,072
5.70
51,852
6.10
2,215
5.70
481
7.85
54,548
6.10
282,566
6.24
12,172
5.35
2,406
6.52
548
6.85
297,692
6.21
284,603
6.12
17,741
5.61
302,344
6.09
474,028
6.12
22,212
5.89
529
5.09
394
6.28
497,163
6.11
$
1,105,689
6.16
%
$
54,769
5.67
%
$
130,831
6.86
%
$
10,993
4.72
$
1,302,282
6.20
%
Table of Contents
Due After June 30, 2010
Fixed
Adjustable
Total
(In thousands)
$
219,743
$
46,194
$
265,937
71,789
205,245
277,034
291,122
265,096
556,218
46,785
7,895
54,680
3,637
23,309
26,946
1,626
1,378
3,004
$
634,702
549,117
$
1,183,819
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At June 30,
At December 31, 2009
2009
(1)
2008
(2)
2007
2006
2005
(Dollars in thousands)
$
1,760
$
98
$
67
$
$
458
$
147
1,076
6,291
30,871
25,685
44
18,200
20,391
14,143
51,907
$
52,465
$
14,210
$
$
458
$
191
$
$
$
$
$
$
$
$
$
$
$
$
51,907
$
52,465
$
14,210
$
$
458
$
191
600
$
52,507
$
52,465
$
14,210
$
$
458
$
191
3.75
%
4.03
%
1.39
%
%
0.07
%
0.04
%
2.62
%
2.74
%
0.98
%
%
0.04
%
0.02
%
(1)
Two construction loans totaling $4.2 million are less than 60 days delinquent at June 30,
2009 and are classified as non-accrual.
(2)
One construction loan totaling $335,000 was less than 60 days delinquent at June 30, 2008 and
was classified as non-accrual.
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Loans Delinquent For
60-89 Days
90 Days and Over
Total
Number
Amount
Number
Amount
Number
Amount
(Dollars in thousands)
1
$
196
3
$
1,341
4
$
1,537
3
704
7
31,948
10
32,652
1
62
1
62
1
1,012
4
18,618
5
19,630
6
$
1,974
14
$
51,907
20
$
53,881
1
$
197
2
$
98
3
$
295
2
6,291
2
6,291
3
17,209
6
25,685
9
42,894
1
419
6
20,391
7
20,810
5
$
17,825
16
$
47,839
21
$
65,664
$
2
$
68
2
$
68
1
18
1
18
2
13,808
2
13,808
1
$
18
4
$
13,876
5
$
13,894
$
$
$
1
39
1
39
1
$
39
$
1
$
39
5
$
180
2
$
348
7
$
528
5
$
180
2
$
348
7
$
528
3
$
139
3
$
140
6
$
279
1
29
1
44
2
73
4
$
168
4
$
184
8
$
352
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Classified Assets At
December 31, 2009
June 30, 2009
June 30, 2008
Number
Amount
Number
Amount
Number
Amount
Number
Amount
(Dollars in thousands
3
$
1,341
2
$
109
3
$
85
$
1
1,076
5
7,602
9
36,199
9
28,827
4
14,375
2
238
5
1,012
4
19,273
18,618
1
141
19
$
58,388
20
$
55,811
7
$
14,460
2
$
238
$
4,460
$
3,896
$
1,497
$
24
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For the Six Months Ended
December 31,
At or For the Years Ended June 30,
2009
2008
2009
2008
2007
2006
2005
(Dollars in thousands)
$
20,681
$
13,532
$
13,532
$
8,882
$
7,672
$
6,172
$
5,372
16
260
785
2,726
2,250
43
222
3,570
2,732
3
3
(3,567
)
(2,732
)
5,050
5,375
9,880
4,650
1,210
1,500
800
$
22,164
$
18,907
$
20,680
$
13,532
$
8,882
$
7,672
$
6,172
0.53
%
%
0.23
%
%
%
%
%
1.60
%
1.54
%
1.59
%
1.32
%
1.15
%
1.18
%
1.23
%
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At December 31,
At June 30,
2009
2009
2008
2007
Percent of Loans
Percent of
Percent of
Percent of Loans in
in Each
Allowance
Loans in Each
Allowance
Loans in Each
Allowance for Loan
Each Category to
Allowance for Loan
Category to
for Loan
Category to
for Loan
Category to
Losses
Total Loans
Losses
Total Loans
Losses
Total Loans
Losses
Total Loans
(Dollars in thousands)
$
1,167
18.8
%
$
1,012
20.4
%
$
845
21.8
%
$
709
24.6
%
3,073
21.4
2,912
21.3
2,535
23.2
2,254
27.4
11,501
45.5
9,683
43.3
5,560
35.2
3,889
31.3
261
3.7
274
4.2
299
5.8
326
8.5
4,889
9.0
5,791
10.0
3,883
13.5
979
8.1
544
1.6
268
0.8
92
0.5
15
0.1
729
740
318
710
$
22,164
100.0
%
$
20,680
100.0
%
$
13,532
100.0
%
$
8,882
100.0
%
At June 30,
2006
2005
Percent of Loans
Percent of
Allowance
in Each
Loans in Each
for Loan
Category to
Allowance for
Category to
Losses
Total Loans
Loan Losses
Total Loans
(Dollars in thousands)
$
749
25.3
%
$
684
29.4
%
2,243
31.5
2,117
36.5
2,591
26.6
1,440
17.6
312
10.2
512
11.1
758
5.9
475
4.9
57
0.5
37
0.5
962
907
$
7,672
100.0
%
$
6,172
100.0
%
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At December 31,
At June 30,
2009
2009
2008
2007
Amortized Cost
Fair Value
Amortized Cost
Fair Value
Amortized Cost
Fair Value
Amortized Cost
Fair Value
(In thousands)
$
$
$
$
$
$
$
5,415
$
5,347
15,740
16,135
18,783
19,063
25,082
24,902
31,365
30,329
2,423
2,426
5,161
5,157
6,055
6,040
8,895
8,907
24,589
25,301
31,329
31,943
42,066
42,094
58,479
57,314
43,430
44,461
63,544
64,218
90,747
89,636
118,667
113,955
$
86,182
$
88,223
$
118,817
$
120,381
$
163,950
$
162,672
$
222,821
$
215,582
At December 31,
At June 30,
2009
2009
2008
2007
Amortized Cost
Fair Value
Amortized Cost
Fair Value
Amortized Cost
Fair Value
Amortized Cost
Fair Value
(In thousands)
310,775
311,194
$
134,754
$
134,837
$
10,000
$
9,865
$
25,000
$
25,007
2,000
2,083
2,000
2,156
2,000
2,184
2,000
2,024
5,148
5,361
5,636
5,676
7,782
7,782
8,429
8,412
1,763
1,801
1,965
1,750
2,364
2,454
22,352
23,300
26,979
27,875
28,672
28,837
1,363
1,363
20,267
21,245
27,023
27,911
31,084
30,895
5,891
5,918
2,537
2,557
3,134
3,143
4,502
4,548
52,566
53,968
68,571
70,260
85,351
86,334
27,024
26,964
$
414,871
$
418,952
$
269,465
$
273,022
$
170,387
$
171,494
$
74,209
$
74,236
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One Year or Less
More than One Year through Five Years
More than Five Years through Ten Years
More than Ten Years
Total Securities
Weighted Average
Weighted Average
Weighted Average
Weighted Average
Weighted Average
Amortized Cost
Yield
Amortized Cost
Yield
Amortized Cost
Yield
Amortized Cost
Yield
Amortized Cost
Fair Value
Yield
(Dollars in thousands)
$
2,341
3.5
%
$
3,423
4.1
%
$
9,976
3.7
%
$
%
$
15,740
$
16,135
3.8
%
2,423
3.0
2,423
2,426
3.0
24,589
3.8
24,589
25,301
3.8
43,430
4.0
43,430
44,361
4.0
$
2,341
3.5
%
$
43,430
4.0
%
$
9,976
3.7
%
$
27,012
3.7
%
$
86,182
$
88,223
3.9
%
$
%
$
310,775
2.8
%
$
%
$
%
$
310,775
$
311,194
2.8
%
2,000
8.1
2,000
2,083
8.1
5,148
3.7
5,148
5,361
3.7
1,763
1,763
1,801
2,800
3.5
12,274
4.6
7,278
4.6
22,352
23,300
4.5
20,267
4.9
20,267
21,245
4.9
52,566
4.9
52,566
53,968
4.9
$
9,711
3.0
%
$
377,615
3.1
%
$
%
$
27,545
4.8
%
$
414,871
$
418,952
3.3
%
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At December 31,
At June 30,
At June 30,
2009
2009
2008
Weighted Average
Weighted Average
Weighted Average
Balance
Percent
Ratio
Balance
Percent
Ratio
Balance
Percent
Ratio
(Dollars in thousands)
$
106,968
8.82
%
0.75
%
$
88,759
7.87
%
0.90
%
$
73,949
10.58
%
0.89
%
271,583
22.44
1.43
199,965
17.73
2.07
57,117
8.17
2.92
146,442
12.10
0.79
147,669
13.10
1.04
149,062
21.33
1.35
685,514
56.64
2.32
691,237
61.30
2.84
418,804
59.92
3.84
$
1,210,507
100.00
%
1.80
%
$
1,127,630
100.00
%
2.32
%
$
698,932
100.00
%
2.92
%
At June 30,
2007
Weighted Average
Balance
Percent
Rate
(Dollars in thousands)
$
75,510
10.85
%
1.12
%
41,029
5.90
4.00
156,670
22.52
1.56
422,548
60.73
4.75
$
695,757
100.00
%
3.59
%
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At
December 31, 2009
(In thousands)
$
99,723
58,214
46,990
32,688
2,730
$
240,345
At December 31,
At or For the Years Ended June 30,
2009
2009
2008
2007
(Dollars in thousands)
$
507,439
$
508,991
$
433,672
$
196,661
$
508,145
$
505,599
$
310,231
$
210,598
$
508,708
$
544,238
$
433,672
$
233,797
3.96
%
3.96
%
4.00
%
4.17
%
4.13
%
4.00
%
4.30
%
4.34
%
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For the Six Months Ended December 31, 2009
Book
Book Value at
Profit/
Distributions
Additional
Value at
Property Name
June 30, 2009
(Loss)
Received
Investment
December 31, 2009
$
(428
)
$
184
$
(185
)
$
$
(429
)
(439
)
23
(16
)
(432
)
(228
)
46
(25
)
(207
)
(334
)
37
(45
)
(342
)
869
151
(127
)
894
328
266
328
140
3
$
1,337
$
420
$
(127
)
$
$
1,222
$
(1,429
)
$
390
$
(271
)
$
$
(1,410
)
$
(203
)
$
55
$
(24
)
$
$
(172
)
(23
)
33
(40
)
(30
)
141
(6
)
(8
)
127
3,329
375
(681
)
3,023
554
1
(32
)
523
167
30
(27
)
170
18
85
(100
)
3
436
(17
)
419
579
26
605
443
10
453
16
387
403
118
(6
)
114
$
5,767
$
435
$
(753
)
$
387
$
5,836
$
(208
)
$
173
$
(164
)
$
$
(199
)
(1)
The book values for wholly owned properties represent the costs of the fixed assets
associated with the property, less accumulated depreciation.
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(1)
real estate mortgages;
(2)
consumer and commercial loans;
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(3)
specific types of debt securities, including certain corporate debt securities
and obligations of federal, state and local governments and agencies;
(4)
certain types of corporate equity securities; and
(5)
certain other assets.
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common stockholders equity, excluding the unrealized appreciation or
depreciation, net of tax, from available for sale securities;
non-cumulative perpetual preferred stock, including any related retained
earnings; and
minority interests in consolidated subsidiaries minus all intangible assets,
other than qualifying servicing rights and any net unrealized loss on marketable
equity securities.
cumulative perpetual preferred stock;
certain perpetual preferred stock for which the dividend rate may be reset
periodically;
hybrid capital instruments, including mandatory convertible securities;
term subordinated debt;
intermediate term preferred stock;
allowance for loan losses; and
up to 45% of pretax net unrealized holding gains on available for sale equity
securities with readily determinable fair market values.
the quality of the banks interest rate risk management process;
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the overall financial condition of the bank; and
the level of other risks at the bank for which capital is needed.
As of December 31, 2009
Capital
Percent of Assets
(1)
(Dollars in thousands)
$
193,183
9.76
%
193,183
13.49
211,236
14.75
(1)
For purposes of calculating Core capital, assets
are based on adjusted total leverage assets. In calculating Tier 1
risk-based capital and total risk-based capital, assets are based on
total risk-weighted assets.
its ratio of total capital to risk-weighted assets is at least 10% ;
its ratio of Tier 1 capital to risk-weighted assets is at least 6%; and
its ratio of Tier 1 capital to total assets is at least 5%, and it is not
subject to any order or directive by the FDIC to meet a specific capital level.
its ratio of total capital to risk-weighted assets is at least 8%; or
its ratio of Tier 1 capital to risk-weighted assets is at least 4%; and
its ratio of Tier 1 capital to total assets is at least 4% (3% if the bank
receives the highest rating under the Uniform Financial Institutions Rating System)
and it is not a well-capitalized institution.
its total risk-based capital is less than 8%; or
its Tier 1 risk-based-capital is less than 4%; and
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its leverage ratio is less than 4% (or less than 3% if the institution receives
the highest rating under the Uniform Financial Institutions Rating System).
its total risk-based capital is less than 6%;
its Tier 1 capital is less than 3%; or
its leverage ratio is less than 3%.
insolvency, or when the assets of the bank are less than its liabilities to
depositors and others;
substantial dissipation of assets or earnings through violations of law or
unsafe or unsound practices;
existence of an unsafe or unsound condition to transact business;
likelihood that the bank will be unable to meet the demands of its depositors or
to pay its obligations in the normal course of business; and
insufficient capital, or the incurring or likely incurring of losses that will
deplete substantially all of the institutions capital with no reasonable prospect
of replenishment of capital without federal assistance.
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limits the extent to which the bank or its subsidiaries may engage in covered
transactions with any one affiliate to an amount equal to 10.0% of such banks
capital stock and retained earnings, and limits all such transactions with all
affiliates to an amount equal to 20% of such capital stock and retained earnings;
and
requires that all such transactions be on terms that are consistent with safe
and sound banking practices.
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a lending test, to evaluate the institutions record of making loans in its
service areas;
an investment test, to evaluate the institutions record of investing in
community development projects, affordable housing, and programs benefiting low or
moderate income individuals and businesses; and
a service test, to evaluate the institutions delivery of services through its
branches, ATMs and other offices.
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Truth-In-Lending Act, governing disclosures of credit terms to consumer
borrowers;
Home Mortgage Disclosure Act of 1975, requiring financial institutions to
provide information to enable the public and public officials to determine whether
a financial institution is fulfilling its obligation to help meet the housing needs
of the community it serves;
Equal Credit Opportunity Act, prohibiting discrimination on the basis of race,
creed or other prohibited factors in extending credit;
Fair Credit Reporting Act of 1978, governing the use and provision of
information to credit reporting agencies;
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Fair Debt Collection Act, governing the manner in which consumer debts may be
collected by collection agencies; and
Rules and regulations of the various federal agencies charged with the
responsibility of implementing such federal laws.
Right to Financial Privacy Act, which imposes a duty to maintain confidentiality
of consumer financial records and prescribes procedures for complying with
administrative subpoenas of financial records;
Electronic Funds Transfer Act and Regulation E promulgated thereunder, which
govern automatic deposits to and withdrawals from deposit accounts and customers
rights and liabilities arising from the use of automated teller machines and other
electronic banking services;
Check Clearing for the 21
st
Century Act (also known as Check 21),
which gives substitute checks, such as digital check images and copies made from
that image, the same legal standing as the original paper check;
Title III of The Uniting and Strengthening America by Providing Appropriate
Tools Required to Intercept and Obstruct Terrorism Act of 2001 (referred to as the
USA PATRIOT Act), which significantly expanded the responsibilities of financial
institutions, including savings banks, in preventing the use of the U.S. financial
system to fund terrorist activities. Among other provisions, the USA PATRIOT Act
and the related regulations of the OTS require savings associations operating in
the United States to develop new anti-money laundering compliance programs, due
diligence policies and controls to ensure the detection and reporting of money
laundering. Such required compliance programs are intended to supplement existing
compliance requirements, also applicable to financial institutions, under the Bank
Secrecy Act and the Office of Foreign Assets Control Regulations; and
The Gramm-Leach-Bliley Act, which placed limitations on the sharing of consumer
financial information by financial institutions with unaffiliated third parties.
Specifically, the Gramm-Leach-Bliley Act requires all financial institutions
offering financial products or services to retail customers to provide such
customers with the financial institutions privacy policy and provide such
customers the opportunity to opt out of the sharing of certain personal financial
information with unaffiliated third parties.
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(i)
investing in the stock of a savings bank;
(ii)
acquiring a mutual association through the merger of such association
into a savings bank subsidiary of such holding company or an interim savings
bank subsidiary of such holding company;
(iii)
merging with or acquiring another holding company, one of whose
subsidiaries is a savings bank;
(iv)
investing in a corporation, the capital stock of which is available
for purchase by a savings bank under federal law or under the law of any state
where the subsidiary savings bank or associations share their home offices;
(v)
furnishing or performing management services for a savings bank
subsidiary of such company;
(vi)
holding, managing or liquidating assets owned or acquired from a
savings subsidiary of such company;
(vii)
holding or managing properties used or occupied by a savings bank
subsidiary of such company;
(viii)
acting as trustee under deeds of trust;
(ix)
any other activity:
(x)
any activity permissible for financial holding companies under Section
4(k) of the Bank Holding Company Act, including securities and insurance
underwriting; and
(xi)
purchasing, holding, or disposing of stock acquired in connection
with a qualified stock issuance if the purchase of such stock by such savings
and loan holding company is approved by the Director. If a mutual holding
company acquires or merges with another holding company, the holding company
acquired or the holding company resulting from such merger or acquisition may
only invest in assets and engage in activities listed in (i) through (x) above,
and has a period of two years to cease any nonconforming activities and divest
any nonconforming investments.
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Name
Positions Held
President and Chief Executive Officer
Executive Vice President and Chief Operating Officer
Executive Vice President and Chief Financial Officer
Executive Vice President and Chief Lending Officer
Senior Vice President and Corporate Secretary
Unvested Stock
Shares Owned
Awards included in
Directly and
Options Exercisable
Beneficial
Name(1)
Indirectly(1)
within 60 days
Beneficial Ownership
Percent of Class
Ownership
72,150
47,689
119,839
*
30,998
122,371
71,534
193,905
*
57,227
101,904
47,689
149,593
*
30,998
269,083
158,964
428,047
1.16
%
119,224
82,063
47,689
129,752
*
30,998
119,213
47,689
166,902
*
30,998
NAMED EXECUTIVE OFFICERS WHO ARE NOT DIRECTORS
122,227
71,534
193,761
*
57,227
107,394
71,534
178,928
*
57,227
26,404
10,598
37,002
*
9,000
1,173,722
(2)
612,013
1,785,734
4.82
%
453,897
*
Less than 1%.
(1)
Unless otherwise indicated, each person effectively exercises sole, or shared with spouse,
voting and dispositive power as to the shares reported. Totals include unvested stock awards
that were granted pursuant to the 2007 Equity Incentive Plan. The totals for Messrs. Skelly
and Hekemian include 50,000 shares and 16,241 shares, respectively, owned through a company in
which each individual has a beneficial ownership.
(2)
Includes 38,724 shares of common stock allocated to the accounts of executive officers under
the Oritani Bank Employee Stock Ownership Plan.
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Preside at executive session of the non-management directors.
Facilitate communications between other members of the Board of Directors and
the Chief Executive Officer. Any director is free to communicate directly with the
Chief Executive Officer. The Lead Directors role is to attempt to improve such
communications if they are not entirely satisfactory.
Work with the Chief Executive Officer in the preparation of the Board of
Directors meeting agenda and information to be provided to the Board of Directors.
Chair the annual review of the performance of the Chief Executive Officer.
Otherwise consult with the Chief Executive Officer on matters relating to
corporate governance and board performance.
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OceanFirst Financial Corp.
Partners Trust Financial
PennFed Financial Services, Inc.
Provident Financial Services, Inc.
Provident New York
Roma Financial Corp.
Synergy Financial Corp.
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Base Salary
Increase Date
Increase
% Increase
New Base Salary
$
500,000
11/10/08
$
45,000
9.00
%
$
545,000
$
250,000
11/10/08
$
22,500
9.00
%
$
272,500
$
200,000
11/10/08
$
18,000
9.00
%
$
218,000
$
200,000
11/10/08
$
18,000
9.00
%
$
218,000
$
189,000
N/M
$
N/M
$
189,000
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Roma Bank
Northfield Bank
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A multi-employer defined benefit plan (a qualified plan). The plan was frozen as of
December 31, 2008. All employees who attained the age of 21 and completed one year of
service were eligible to participate in the plan.
A nonqualified savings incentive plan covering employees whose salary deferrals to the
savings incentive plan are limited.
A nonqualified Benefit Equalization Plan which provides benefits to employees who are
disallowed certain benefits under our qualified benefit plans.
A nonqualified Post Retirement Medical Plan for directors and certain eligible
employees.
A nonqualified Executive Supplemental Retirement Income Agreement for our President and
Chief Executive Officer.
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Change in pension
value and
non-qualified
deferred
All other
Name and principal
Option Awards ($)
compensation
compensation ($)
position
Fiscal Year
Salary ($)(1)
Bonus ($)
Stock Awards ($)(2)
(3)
earnings ($) (4)
(5)
Total ($)
2009
550,750
250,000
621,949
273,419
1,648,874
110,512
3,455,504
2008
530,769
250,000
103,658
45,570
919,491
111,241
1,960,730
2007
494,327
200,000
702,360
63,356
1,460,043
2009
263,846
65,625
298,536
123,038
87,278
25,995
864,318
2008
57,692
49,756
20,506
22,884
8,312
159,150
2009
211,077
70,000
298,536
123,038
73,436
76,249
852,336
2008
196,192
56,700
49,756
20,506
19,149
77,649
419,952
2007
189,627
59,150
18,414
28,645
295,836
2009
211,077
80,000
298,536
123,038
115,092
77,776
905,519
2008
188,923
58,800
49,756
20,506
39,735
80,826
438,546
2007
163,817
53,200
29,336
29,520
275,873
2009
191,181
37,800
46,950
18,228
192,800
76,239
563,198
2008
192,635
47,250
7,825
3,038
60,577
78,649
389,973
2007
187,270
46,000
64,599
28,098
325,967
(1)
Includes $23,058 and $2,181 of payments made in 2009 to Messrs. Lynch and Wyks, respectively,
for unused vacation days.
(2)
The amounts in this column reflect the dollar amount recognized for financial statement
reporting purposes for the fiscal years ended June 30, 2009 and 2008, in accordance with SFAS
123(R) and its successor, FASB ASC Topic 718, of restricted stock awards pursuant to the
Equity Plan. Assumptions used in the calculation of this amount are included in footnote 14 to
Oritani Financial Corp.s audited financial statements for the fiscal year ended June 30, 2009
included herein.
(3)
The amounts in this column reflect the dollar amount recognized for financial statement
reporting purposes, for the fiscal years ended June 30, 2009 and 2008, in accordance with SFAS
123(R) and its successor, FASB ASC Topic 718, of stock option awards pursuant to the Equity
Plan. Assumptions used in the calculation of this amount are included in footnote 14 to
Oritani Financial Corp.s audited financial statements for the fiscal year ended June 30, 2009
included herein.
(4)
The amounts in this column reflect the actuarial increase in the present value at June 30,
2009 compared to June 30, 2008, of the named executive officers benefits under the Defined
Benefit Plan and Benefit Equalization Plan and, in the case of Mr. Lynch, an Executive
Supplement Retirement Income Agreement and the Directors Retirement Plan maintained by
Oritani Bank, and, in the case of Mr. DeBernardi, the Directors Retirement Plan maintained by
Oritani Bank, determined using interest rate and mortality rate assumptions consistent with
those used in Oritani Financial Corp.s financial statements and includes amounts for which
the named executive officer may not currently be entitled to receive because such amounts are
not vested. This column also includes $69,874, $73, $7,435, $2,091, and $5,799 of
preferential or above-market earnings on non tax-qualified deferred compensation for
non-qualified defined contribution plans for Messrs. Lynch, DeBernardi, Fields, Guinan and
Wyks, respectively, as well as $21,025 for Mr. DeBernardi of preferential earnings on a
similar plan for deferred director fees.
(5)
The amounts in this column represent the total of all perquisites (non-cash benefits and
perquisites such as the use of employer-owned automobiles, membership dues and other personal
benefits), employee benefits (employer cost of life insurance and health insurance), and
employer contributions to defined contribution plans (the 401(k) Plan, the ESOP and the
Benefit Equalization Plan). Amounts are reported separately under the All Other
Compensation table below.
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Company
Contribution on
Company
Medical, Dental,
Contribution to
Benefit
Disability and
ESOP and 401(k)
Equalization Plan
Insurance Benefits
Automobile
Plan Match
Match Contribution
Country Club Dues
Name
Fiscal Year
($)
Allowance ($)
Contribution ($)
($)
($)
Total ($)
2009
16,846
16,521
48,430
20,561
8,154
110,512
2008
19,885
13,073
48,480
23,423
6,380
111,241
2007
20,037
15,844
3,462
17,368
6,645
63,356
2009
14,803
9,305
1,887
25,995
2008
8,312
8,312
2009
13,228
9,620
47,969
5,432
76,249
2008
12,102
9,581
48,815
7,151
77,649
2007
11,042
10,140
3,615
3,848
28,645
2009
12,168
7,469
48,527
5,001
4,611
77,776
2008
11,079
7,458
53,612
2,299
6,377
80,826
2007
10,078
6,315
6,511
6,615
29,520
2009
16,879
7,522
49,767
2,072
76,239
2008
15,999
7,438
50,414
4,798
78,649
2007
14,515
6,585
6,998
28,098
Estimated Possible Payouts
Under Non-Equity Incentive Plan
Awards (1)
Threshold
Target
Maximum
Name
($)
($)
($)
136,250
272,500
408,750
59,950
109,00
133,525
47,960
87,200
106,820
47,960
87,200
106,820
30,712
37,800
47,250
(1)
Assumes full achievement of individual component of award total.
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OUTSTANDING EQUITY AWARDS AT JUNE 30, 2009
Option Awards
Stock Awards
Number of
Number of
Market Value of
Securities
Securities
Shares or Units of
Underlying
Underlying
Number of Shares or
Stock That Have Not
Unexercised Options
Unexercised Options
Option Exercise
Option Expiration
Units of Stock That
Vested ($)
Name
(#) Exercisable
(#) Unexercisable
Price ($)
Date
(1)
Have Not Vested (#)
(2)
79,482
317,929
15.65
05/05/18
158,965
2,179,410
35,767
143,068
15.65
05/05/18
76,303
1,046,114
35,767
143,068
15.65
05/05/18
76,303
1,046,114
35,767
143,068
15.65
05/05/18
76,303
1,046,114
5,299
21,195
15.65
05/05/18
12,000
164,520
(1)
Stock options expire 10 years after the grant date.
(2)
This amount is based on the per share fair market value of Oritani Financial Corp.s common
stock on June 30, 2009 of $13.71.
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Pension Benefits at and for the Fiscal Year Ended June 30, 2009
Number of Years
Present Value of
Payments During
Credited Service
Accumulated Benefit
Last Fiscal Year
Name
Plan Name
(#)
($)
(1)
($)
Defined Benefit Plan
15.50
531,000
Directors Retirement Plan
18.67
407,000
Benefit Equalization Plan
15.50
1,473,000
Executive Supplemental Income Agreement
4.50
2,314,000
Defined Benefit Plan
Benefit Equalization Plan
Directors Retirement Plan
15.67
170,000
Defined Benefit Plan
10.67
128,000
Benefit Equalization Plan
10.67
27,000
Defined Benefit Plan
21.17
303,000
Benefit Equalization Plan
5.50
8,000
Defined Benefit Plan
32.50
701,000
Benefit Equalization Plan
32.50
83,000
(1)
The figures shown are determined as of the plans measurement date of June 30, 2009 for
purposes of Oritani Financial Corp.s audited financial statements. For mortality, discount rate
and other assumptions used for this purpose, please refer to note 13 in the audited financial
statements included herein.
Nonqualified Deferred Compensation at and for the Fiscal Year Ended June 30, 2009
Registrant
Executive
Contributions in
Aggregate Earnings
Aggregate
Aggregate Balance
Contributions in
Last Fiscal
in Last Fiscal Year
Withdrawals/
at Last Fiscal Year
Name
Last Fiscal Year
Year
(1)
(2)
Distributions ($)
End ($)
127,199
20,561
106,093
1,318,161
12,632
1,887
144
14,662
33,312
5,432
15,470
199,995
26,042
5,001
4,237
61,518
12,196
2,072
12,108
147,209
(1)
The amounts reported in this column were also reported as compensation under All Other
Compensation in the Summary Compensation Table.
(2)
For Messrs. Lynch, DeBernardi, Fields, Guinan and Wyks, $69,874, $73, $7,436, $2,092 and
$5,800 respectively, were reported as preferential or above-market earnings for each
individual under Change in pension value and non-qualified deferred compensation earnings in
the Summary Compensation Table.
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Involuntary
Involuntary
Termination after
Termination
Change in Control
Retirement
Disability
Death
$
2,435,537
(1)
$
1,037,789
(2)
$
(3)
$
1,314,719
(4)
$
1,303,546
(5)
$
1,966,900
(6)
$
2,314,000
(6)
$
2,314,000
(6)
$
1,966,900
(6)
$
1,966,900
(6)
$
1,473,000
(7)
$
1,473,000
(7)
$
1,473,000
(7)
$
1,473,000
(7)
$
1,473,000
(7)
$
407,000
(8)
$
407,000
(8)
$
407,000
(8)
$
407,000
(8)
$
407,000
(8)
$
(9)
$
2,179,410
(9)
$
(9)
$
2,179,410
(9)
$
2,179,410
(9)
$
705,857
(10)
$
(11)
$
(12)
$
384,986
(13)
$
382,801
(14)
$
(15)
$
(15)
$
(15)
$
(15)
$
(15)
$
(16)
$
170,000
(16)
$
(16)
$
(16)
$
(16)
$
(17)
$
1,046,114
(17)
$
(17)
$
1,046,114
(17)
$
1,046,114
(17)
$
602,455
(18)
$
306,669
(19)
$
(20)
$
309,845
(21)
$
308,295
(22)
$
27,000
(23)
$
27,000
(23)
$
27,000
(23)
$
27,000
(23)
$
27,000
(23)
$
(24)
$
1,046,114
(24)
$
(24)
$
1,046,114
(24)
$
1,046,114
(24)
$
620,336
(25)
$
272,881
(26)
$
(27)
$
308,425
(28)
$
306,875
(29)
$
8,000
(30)
$
8,000
(30)
$
8,000
(30)
$
8,000
(30)
$
8,000
(30)
$
(31)
$
1,046,114
(31)
$
(31)
$
1,046,114
(31)
$
1,046,114
(31)
$
487,358
(32)
$
487,358
(33)
$
(34)
$
275,878
(35)
$
274,427
(36)
$
83,000
(37)
$
83,000
(37)
$
83,000
(37)
$
83,000
(37)
$
83,000
(37)
$
(38)
$
164,520
(38)
$
(38)
$
164,520
(38)
$
164,520
(38)
(1)
This amount represents 3 times the sum of (i) Mr. Lynchs highest base salary plus (ii)
highest bonus, and (iii) Oritani Bank contributions to continued life, medical, dental and
disability insurance for 36 months following termination of employment.
(2)
This amount represents the maximum severance payments and other benefits to Mr. Lynch under
his employment agreement without incurring an excess parachute payment under Code Section
280G. Severance payments and other benefits provided to Mr. Lynch as a result of the change
in control are reduced by $1,397,749 in order to avoid an excess parachute payment.
(3)
Mr. Lynch is entitled to no payments or benefits under his employment agreement as a result
of his retirement.
(4)
In the event of his disability, Mr. Lynch would receive his base salary and continued health
care coverage for the longer of the remaining term of his employment agreement, or one year,
less amounts payable under any disability programs. This amount represents Mr. Lynchs base
salary and continued life, medical, dental and disability insurance for the remaining term of
the agreement, without any reduction for payments under bank sponsored disability programs.
(5)
In the event of his death, Mr. Lynchs beneficiary would be entitled to receive Mr. Lynchs
base salary and medical, dental, family and other benefits for the remaining term of the
employment agreement.
(6)
This amount represents the present value of Mr. Lynchs accumulated benefit under his
Executive Supplemental Retirement Income Agreement. Under his Executive Supplemental
Retirement Income Agreement, Mr. Lynch is entitled to receive an annual supplemental
retirement benefit commencing at age 65 equal to 70% of his highest annual base salary and
bonus over the consecutive 36 month period within the last 120 consecutive calendar months of
employment, reduced by the sum of (i) the annuitized value of his benefits under the banks
pension plan, (ii) the annuitized value of his benefits under the defined benefit portion of
the Banks Benefit Equalization Plan, and (iii) the annuitized value of one-half of his Social
Security benefits attributable to taxes paid by the bank on his behalf. Upon a change in
control, Mr. Lynch is entitled to the full supplemental retirement income benefit as if he
worked through age 65. In the event of Mr. Lynchs death, disability, or termination prior to
reaching age 65, Mr. Lynch is entitled to his early retirement benefit equal to 85% of his
supplemental retirement benefit. Mr. Lynch is fully vested in his early retirement benefit.
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(7)
Following Mr. Lynchs separation from service for any reason, he will be entitled to receive
his accrued benefit under the Benefit Equalization Plan as of his date of termination.
(8)
This amount represents the present value of Mr. Lynchs accumulated benefit under the 2005
Directors Retirement Plan. Under the 2005 Director s Retirement Plan, Mr. Lynch is entitled
to receive an annual retirement benefit equal to 50% of the aggregate compensation paid to him
during the year of his retirement. Mr. Lynch is currently 100% vested in his annual
retirement benefit under the plan, and his benefits under the plan will commence following his
date of termination.
(9)
This amount represents the fair market value of the outstanding equity awards that become
exercisable as a result of Mr. Lynchs involuntary termination after a change in control,
disability, or death. In the event of Mr. Lynchs involuntary termination or retirement, his
unvested outstanding equity awards would be forfeited.
(10)
This amount represents 2 times the sum of (i) Mr. DeBernardis highest base salary plus (ii)
highest bonus, and (iii) Bank contributions to continued life, medical, dental and disability
insurance for 24 months following termination of employment.
(11)
This amount represents the maximum severance payments and other benefits to Mr. DeBernardi
under his employment agreement without incurring an excess parachute payment under Code
Section 280G. Severance payments and other benefits provided to Mr. DeBernardi as a result of
the change in control are reduced by $705,857 in order to avoid an excess parachute payment.
(12)
Mr. DeBernardi is entitled to no payments or benefits under his employment agreement as a
result of his retirement.
(13)
In the event of his disability, Mr. DeBernardi would receive his base salary and continued
health care coverage for the longer of the remaining term of his employment agreement, or one
year, less amounts payable under any disability programs. This amount represents Mr.
DeBernardis base salary and continued life, medical, dental and disability insurance for the
remaining term of the agreement, without any reduction for payments under Bank sponsored
disability programs.
(14)
In the event of his death, Mr. DeBernardis beneficiary would be entitled to receive Mr.
DeBernardis base salary and medical, dental, family and other benefits for the remaining term
of the employment agreement.
(15)
Mr. DeBernardi has not accumulated any benefits under the Benefit Equalization Plan.
(16)
Under the 2005 Director s Retirement Plan, Mr. DeBernardi is entitled to receive an annual
retirement benefit equal to 50% of the aggregate compensation paid to Mr. DeBernardi during
the year of his retirement. Mr. DeBernardi is not currently vested in his annual retirement
benefit under the plan, which will occur when Mr. DeBernardi attains age 65. Upon a change in
control, Mr. DeBernardi will be entitled to receive his annual retirement benefit regardless
of his actual age.
(17)
This amount represents the fair market value of the outstanding equity awards that become
exercisable as a result of Mr. DeBernardis involuntary termination after a change in control,
disability, or death. In the event of Mr. DeBernardis involuntary termination or retirement,
his unvested outstanding equity awards would be forfeited.
(18)
This amount represents 2 times the sum of (i) Mr. Fields highest base salary plus (ii)
highest bonus, and (iii) Bank contributions to continued life, medical, dental and disability
insurance for 24 months following termination of employment.
(19)
This amount represents the maximum severance payments and other benefits to Mr. Fields under
his employment agreement without incurring an excess parachute payment under Code Section
280G. Severance payments and other benefits to Mr. Fields as a result of the change in
control are reduced by $295,786 in order to avoid an excess parachute payment.
(20)
Mr. Fields is entitled to no payments or benefits under his employment agreement as a result
of his retirement.
(21)
In the event of his disability, Mr. Fields would receive his base salary and continued health
care coverage for the longer of the remaining term of his employment agreement, or one year,
less amounts payable under any disability programs. This amount represents Mr. Fields base
salary and continued life, medical, dental and disability insurance for the remaining term of
the agreement, without any reduction for payments under Bank sponsored disability programs.
(22)
In the event of his death, Mr. Fields beneficiary would be entitled to receive Mr. Fields
base salary and medical, dental, family and other benefits for the remaining term of the
employment agreement.
(23)
Following Mr. Fields separation from service for any reason, he will be entitled to receive
his accrued benefit under the Benefit Equalization Plan as of his date of termination.
(24)
This amount represents the fair market value of the outstanding equity awards that become
exercisable as a result of Mr. Fields involuntary termination after a change in control,
disability, or death. In the event of Mr. Fields involuntary termination or retirement, his
unvested outstanding equity awards would be forfeited.
(25)
This amount represents 2 times the sum of (i) Mr. Guinans highest base salary plus (ii)
highest bonus, and (iii) Bank contributions to continued life, medical, dental and disability
insurance for 24 months following termination of employment.
(26)
This amount represents the maximum severance payments and other benefits to Mr. Guinan under
his employment agreement without incurring an excess parachute payment under Code Section
280G. Severance payments and other benefits to Mr. Guinan as a result of the change in
control are reduced by $347,455 in order to avoid an excess parachute payment.
(27)
Mr. Guinan is entitled to no payments or benefits under his employment agreement as a result
of his retirement.
(28)
In the event of his disability, Mr. Guinan would receive his base salary and continued health
care coverage for the longer of the remaining term of his employment agreement, or one year,
less amounts payable under any disability programs. This amount represents Mr. Guinans base
salary and continued life, medical, dental and disability insurance for the remaining term of
the agreement, without any reduction for payments under Bank sponsored disability programs.
(29)
In the event of his death, Mr. Guinan beneficiary would be entitled to receive Mr. Guinans
base salary and medical, dental, family and other benefits for the remaining term of the
employment agreement.
(30)
Following Mr. Guinans separation from service for any reason, he will be entitled to receive
his accrued benefit under the Benefit Equalization Plan as of his date of termination.
(31)
This amount represents the fair market value of the outstanding equity awards that become
exercisable as a result of Mr. Guinans involuntary termination after a change in control,
disability, or death. In the event of Mr. Guinans involuntary termination or retirement, his
unvested outstanding equity awards would be forfeited.
(32)
This amount represents 2 times the sum of (i) Mr. Wyks highest base salary plus (ii) highest
bonus, and (iii) Bank contributions to continued life, medical, dental and disability
insurance for 24 months following termination of employment.
(33)
This amount represents 2 times the sum of (i) Mr. Wyks highest base salary plus (ii) highest
bonus, and (iii) Bank contributions to continued life, medical, dental and disability
insurance for 24 months following his termination of employment in connection with a change in
control.
(34)
Mr. Wyks is entitled to no payments or benefits under his employment agreement as a result of
his retirement.
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(35)
In the event of his disability, Mr. Wyks would receive his base salary and continued health
care coverage for the longer of the remaining term of his employment agreement, or one year,
less amounts payable under any disability programs. This amount represents Mr. Wykss base
salary and continued life, medical, dental and disability insurance for the remaining term of
the agreement, without any reduction for payments under Bank sponsored disability programs.
(36)
In the event of his death, Mr. Wyks beneficiary would be entitled to receive Mr. Wykss base
salary and medical, dental, family and other benefits for the remaining term of the employment
agreement.
(37)
Following Mr. Wykss separation from service for any reason, he will be entitled to receive
his accrued benefit under the Benefit Equalization Plan as of his date of termination.
(38)
This amount represents the fair market value of the outstanding equity awards that become
exercisable as a result of Mr. Wykss involuntary termination after a change in control,
disability, or death. In the event of Mr. Wykss involuntary termination or retirement, his
unvested outstanding equity awards would be forfeited.
Change in Pension
Value and
Nonqualified
Deferred
Fees Earned or Paid
Option Awards ($)
Compensation
Name
in Cash ($)
Stock Awards ($) (1)
(2)
Earnings ($) (3)
Total ($)
98,750
161,707
82,026
170,775
513,257
88,750
161,707
82,026
132,554
465,036
88,750
161,707
82,026
55,885
388,377
88,750
161,707
82,026
134,522
467,005
(1)
The amounts in this column reflect the dollar amount recognized for financial statement
reporting purposes for the fiscal year ended June 30, 2009, in accordance with FAS 123(R) and
its successor, FASB ASC Topic 718, of restricted stock awards pursuant to the Equity Plan that
were made in 2008, which vest over five years. Assumptions used in the calculation of these
amounts are included in footnote 14 to Oritani Financial Corp.s audited financial statements
for the fiscal year ended June 30, 2009 included in Oritani Financial Corp.s Annual Report on
Form 10-K.
(2)
The amounts in this column reflect the dollar amount recognized for financial statement
reporting purposes for the fiscal year ended June 30, 2009, in accordance with FAS 123(R) and
its successor, FASB ASC Topic 718, of stock option awards pursuant to the Equity Plan that
were made in 2008. Stock options vest over five years. Assumptions used in the calculation
of these amounts are included in footnote 14 to Oritani Financial Corp.s audited financial
statements for the fiscal year ended June 30, 2009 included in Oritani Financial Corp.s
Annual Report on Form 10-K.
(3)
The amounts in this column reflect the actuarial increase in the present value at June 30,
2009 compared to June 30, 2008, of the directors benefits under the Directors Retirement
Plan maintained by Oritani Bank, determined using interest rate and mortality rate assumptions
consistent with those used in Oritani Financial Corp.s financial statements and include
amounts for which the director may not currently be entitled to receive because such amounts
are not vested. Also includes $32,775, $31,554, $22,895 and $22,522 of preferential or
above-market earnings on non tax-qualified deferred compensation for Directors Antonaccio,
Doyle, Hekemian and Skelly, respectively, under the Directors Deferred Fee Plan.
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non-employee directors in the aggregate may not receive more than 30% of
the options and restricted stock awards authorized under the plan;
any one non-employee director may not receive more than 5% of the options
and restricted stock awards authorized under the plan;
any officer or employee may not receive more than 25% of the options and
restricted stock awards authorized under the plan;
any tax-qualified employee stock benefit plans and management stock award
plans, in the aggregate, may not hold more than 10.0% of the shares sold in the
offering, unless Oritani Bank has tangible capital of 10.0% or more, in which case any
tax-qualified employee stock benefit plans and management stock award plans, may be
increased to up to 12% of the shares sold in the offering;
stock options and restricted stock awards may not vest more rapidly than
20% per year, beginning on the first anniversary of the grant;
accelerated vesting is not permitted except for death, disability or upon
a change in control of Oritani Bank or Oritani; and
our executive officers or directors must exercise or forfeit their options
in the event that Oritani Bank becomes critically undercapitalized, is subject to
enforcement action or receives a capital directive.
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(i)
the number of exchange shares to be held upon consummation of the conversion,
based upon their beneficial ownership of Oritani Financial Corp. common stock as of
______;
(ii)
the proposed purchases of subscription shares, assuming sufficient shares of
common stock are available to satisfy their subscriptions; and
(iii)
the total amount of Oritani common stock to be held upon consummation of the
conversion.
Number of
Proposed Purchases of Stock in
Total Common Stock to be Held
Exchange Shares to
the Offering (1)
Percentage of Total
Name of Beneficial Owner
be Held (2)
Number of Shares
Amount
Number of Shares
Outstanding (2)
$
$
%
$
$
%
$
%
*
Less than 1%.
(1)
Includes proposed subscriptions, if any, through the director or officers 401(k) account and
by associates.
(2)
Assumes an exchange ratio of
shares for each share of Oritani Financial Corp. and that
shares are outstanding after the conversion. Includes shares that may be acquired
upon the exercise of stock options.
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(i)
First, to depositors with accounts at Oritani Bank with aggregate balances of
at least $50.00 at the close of business on December 31, 2008.
(ii)
Second, to our tax-qualified employee benefit plans, including our employee
stock ownership plan and 401(k) plan, which will receive nontransferable subscription
rights to purchase in the aggregate up to 10.0% of the shares of common stock sold in
the offering.
(iii)
Third, to depositors with accounts at Oritani Bank with aggregate balances of
at least $50.00 at the close of business on [supplemental record date].
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(iv)
Fourth, to depositors of Oritani Bank at the close of business on [depositor
record date].
(i)
Persons residing in the New Jersey counties of Bergen, Passaic, Sussex, Hudson,
Essex, Morris, Warren, Union, Somerset, Hunterdon, Middlesex and Mercer;
(ii)
Oritani Banks borrowers (with an outstanding loan or line of credit) as of
December 31, 2009 that are meeting all of the terms and conditions of their loan
agreements with Oritani Bank as of December 31, 2009 and the date of purchase of the
common stock (as determined solely in the discretion of Oritani Bank);
(iii)
Oritani Financial Corp.s public stockholders as of [stockholder record date],
and
(iv)
members of the general public.
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to support internal growth through lending and deposit gathering in the
communities we serve;
to enhance existing products and services, and support the development of
new products and services to support growth and enhanced customer service;
to improve the liquidity of our shares of common stock and stockholder
returns through higher earnings and more flexible capital management strategies;
to finance the acquisition of branches from other financial institutions
or build or lease new branch facilities primarily in, or adjacent to New Jersey,
although we do not currently have any agreements or understandings regarding any
specific acquisition transaction;
to finance the acquisition of financial institutions or other financial
service companies primarily in, or adjacent to New Jersey, although we do not currently
have any understandings or agreements regarding any specific acquisition transaction;
to maintain our capital position during a period of significant economic
uncertainty, especially for the financial services industry (although, as of December
31, 2009, Oritani Bank was considered well capitalized for regulatory purposes and is
not subject to any directive or recommendation from the FDIC or the New Jersey
Department of Banking and Insurance to raise capital); and
to use the additional capital for other general corporate purposes.
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New Shares to be
Total Shares of
New Shares That
Exchanged for Existing
Common Stock to be
Equivalent Per
Would be Received
New Shares to be Sold
Shares of Oritani
Outstanding After
Share Current
for 100 Existing
in This Offering
Financial Corp.
the Offering
Exchange Ratio
Market Value (1)
Shares
Amount
Percent
Amount
Percent
33,150,000
74.4454
%
11,379,252
25.5546
%
44,529,252
1.20220
$
12.02
120
39,000,000
74.4454
%
13,387,355
25.5546
%
52,387,355
1.41430
$
14.14
141
44,850,000
74.4454
%
15,395,458
25.5546
%
60,245,458
1.62640
$
16.26
163
51,577,500
74.4454
%
17,704,777
25.5546
%
69,282,277
1.87040
$
18.70
187
(1)
Represents the value of shares of Oritani received in the conversion by a holder of one share
of Oritani Financial Corp. at the exchange ratio, assuming the market price of $10.00 per
share.
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the present results and financial condition of Oritani Financial Corp. and
the projected results and financial condition of Oritani;
the economic and demographic conditions in Oritani Financial Corp.s
existing market area;
certain historical, financial and other information relating to Oritani
Financial Corp.;
the impact of the offering on Oritanis stockholders equity and earnings
potential;
the proposed dividend policy of Oritani; and
the trading market for securities of comparable institutions and general
conditions in the market for such securities.
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Oritani Financial Corp.s financial condition and results of operations;
comparison of financial performance ratios of Oritani Financial Corp. to
those of other financial institutions of similar size;
market conditions generally and in particular for financial institutions;
and
the historical trading price of the publicly held shares of Oritani
Financial Corp. common stock.
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(i)
Persons residing in the counties of Bergen, Passaic, Sussex, Hudson, Essex,
Morris, Warren, Union, Somerset, Hunterdon, Middlesex and Mercer;
(ii)
Oritani Banks borrowers (with an outstanding loan or line of credit) as of
December 31, 2009 that are meeting all of the terms and conditions of their loan
agreements with Oritani Bank as of December 31, 2009 and the date of purchase of the
common stock (as determined solely in the discretion of Oritani Bank);
(iii)
Oritani Financial Corp.s public stockholder as of [stockholder record date];
and
(iv)
members of the general public.
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(i)
No person may purchase fewer than 25 shares of common stock;
(ii)
The maximum number of shares of common stock that may be purchased by a person,
or persons exercising subscription rights through a single qualifying deposit account
held jointly, is 50,000 shares;
(iii)
Our tax-qualified employee stock benefit plans, including our employee stock
ownership plan and 401(k) plan, may purchase in the aggregate up to 10.0% of the shares
of common stock sold in the offering, including shares sold in the event of an increase
in the offering range of up to 15%;
(iv)
Except for the tax-qualified employee stock benefit plans, including our
employee stock ownership plan and 401(k) plan, as described above, no person or entity,
together with associates or persons acting in concert with such person or entity, may
purchase more than $1.0 million (100,000 shares) of common stock in all categories of
the offering combined;
(v)
Current stockholders of Oritani Financial Corp. are subject to an ownership
limitation. As previously described, current stockholders of Oritani Financial Corp.
will receive shares of Oritani common stock in exchange for their existing shares of
Oritani Financial Corp. common stock at the conclusion of the offering. The number of
shares of common stock that a stockholder may purchase in the offering, together with
associates or persons acting in concert with such stockholder, when combined with the
shares that the stockholder and his or her associates will receive in exchange for
existing Oritani
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Financial Corp. common stock, may not exceed 5% of the shares of common stock of
Oritani to be issued and outstanding at the completion of the conversion; and
(vi)
The maximum number of shares of common stock that may be purchased in all
categories of the offering by executive officers and directors of Oritani Bank and
their associates, in the aggregate, when combined with shares of common stock issued in
exchange for existing shares, may not exceed 25% of the shares of Oritani common stock
outstanding upon completion of the conversion.
(i)
to fill subscriptions by the tax-qualified employee stock benefit plans,
including the employee stock ownership plan, for up to 10.0% of the total number of
shares of common stock sold in the offering;
(ii)
in the event that there is an oversubscription at the Eligible Account Holder,
Supplemental Eligible Account Holder or Other Depositor levels, to fill unfulfilled
subscriptions of these subscribers according to their respective priorities; and
(iii)
to fill subscriptions in the community offering, with preference given first
to persons residing in the New Jersey counties of Bergen, Passaic, Sussex, Hudson,
Essex, Morris, Warren, Union, Somerset, Hunterdon, Middlesex and Mercer; then to
Oritani Banks borrowers (with an outstanding loan or line of credit) as of December
31, 2009 that are meeting all of their terms and conditions of the loan agreements with
Oritani Bank (as determined solely in the discretion of Oritani Bank) as of December
31, 2009 and the date of purchase of the common stock; then to Oritani Financial
Corp.s public stockholders as of [stockholder record date] and then to members of the
general public.
(i)
any corporation or organization, other than Oritani Financial Corp., MHC,
Oritani Financial Corp., Oritani Bank or a majority-owned subsidiary of Oritani
Financial Corp. or Oritani Bank, of which the person is a senior officer, partner or
beneficial owner, directly or indirectly, of 10.0% or more of any equity security;
(ii)
any trust or other estate in which the person has a substantial beneficial
interest or serves as a trustee or in a similar fiduciary capacity; provided, however,
that for the purposes of
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subscriptions in the offering and restrictions on the sale of stock after the
conversion, the term associate does not include a person who has a substantial
beneficial interest in an employee stock benefit plan of Oritani Bank, or who is a
trustee or fiduciary of such plan, and for purposes of aggregating total shares that
may be held by officers, trustees and directors of Oritani Financial Corp., MHC,
Oritani Financial Corp. or Oritani Bank, (the term associate does not include any
tax-qualified employee stock benefit plan of Oritani Bank); and
(iii)
any blood or marriage relative of the person, who either has the same home as
the person or who is a director, trustee or officer of Oritani Financial Corp., MHC,
Oritani Financial Corp. or Oritani Bank.
(i)
knowing participation in a joint activity or interdependent conscious parallel
action towards a common goal whether or not pursuant to an express agreement; or
(ii)
a combination or pooling of voting or other interests in the securities of an
issuer for a common purpose pursuant to any contract, understanding, relationship,
agreement or other arrangement, whether written or otherwise.
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(i)
acting as our financial advisor for the conversion and offering;
(ii)
providing administrative services and managing the Stock Information Center;
(iii)
educating our employees regarding the offering;
(iv)
targeting our sales efforts, including assisting in the preparation of
marketing materials; and
(v)
soliciting orders for common stock.
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(i)
personal check, bank check or money order, made payable to Oritani Bank; or
(ii)
authorization of withdrawal from the types of Oritani Bank deposit accounts
designated on the stock order form.
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1.
The merger of Oritani Financial Corp., MHC with and into Oritani Financial
Corp. will qualify as a tax-free reorganization within the meaning of Section
368(a)(1)(A) of the Internal Revenue Code.
2.
The constructive exchange of Eligible Account Holders and Supplemental
Eligible Account Holders liquidation interests in Oritani Financial Corp., MHC for
liquidation interests in Oritani Financial Corp. will satisfy the continuity of
interest requirement of Section 1.368-1(b) of the Federal Income Tax Regulations.
3.
None of Oritani Financial Corp., MHC, Oritani Financial Corp., Eligible Account
Holders nor Supplemental Eligible Account Holders, will recognize any gain or loss on
the transfer of the assets of Oritani Financial Corp., MHC to Oritani Financial Corp.
in constructive exchange for a liquidation interest established in Oritani Financial
Corp. for the benefit of such persons who remain depositors of Oritani Bank.
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4.
The basis of the assets of Oritani Financial Corp., MHC and the holding period
of such assets to be received by Oritani Financial Corp. will be the same as the basis
and holding period in such assets in the hands of Oritani Financial Corp., MHC
immediately before the exchange. (Sections 362(b) and 1223(2) of the Internal Revenue
Code.)
5.
The merger of Oritani Financial Corp. with and into Oritani will constitute a
mere change in identity, form or place of organization within the meaning of Section
368(a)(1)(F) of the Code and therefore will qualify as a tax-free reorganization within
the meaning of Section 368(a)(1)(F) of the Code. Neither Oritani Financial Corp. nor
Oritani will recognize gain or loss as a result of such merger. (Sections 361(a) and
1032(a) of the Internal Revenue Code).
6.
The basis of the assets of Oritani Financial Corp. and the holding period of
such assets to be received by Oritani will be the same as the basis and holding period
in such assets in the hands of Oritani Financial Corp. immediately before the exchange.
(Sections 362(b) and 1223(2) of the Internal Revenue Code.)
7.
Current stockholders of Oritani Financial Corp. will not recognize any gain or
loss upon their constructive exchange of Oritani Financial Corp. common stock for
Oritani common stock.
8.
Eligible Account Holders and Supplemental Eligible Account Holders will not
recognize any gain or loss upon their constructive exchange of their liquidation
interests in Oritani Financial Corp. for the liquidation accounts in Oritani.
9.
The constructive exchange of the Eligible Account Holders and Supplemental
Eligible Account Holders liquidation interests in Oritani Financial Corp. for interests
in a liquidation account established in Oritani will satisfy the continuity of interest
requirement of Section 1.368-1(b) of the Federal Income Tax Regulations
10.
Each stockholders aggregate basis in shares of Oritani common stock (including
fractional share interests) received in the exchange will be the same as the aggregate
basis of Oritani Financial Corp. common stock surrendered in the exchange.
11.
Each stockholders holding period in his or her Oritani common stock received
in the exchange will include the period during which the Oritani Financial Corp. common
stock surrendered was held, provided that the Oritani Financial Corp. common stock
surrendered is a capital asset in the hands of the stockholder on the date of the
exchange.
12.
Cash received by any current stockholder of Oritani Financial Corp. in lieu of
a fractional share interest in shares of Oritani common stock will be treated as having
been received as a distribution in full payment in exchange for a fractional share
interest of Oritani common stock, which such stockholder would otherwise be entitled to
receive. Accordingly, a stockholder will recognize gain or loss equal to the difference
between the cash received and the basis of the fractional share. If the common stock is
held by the stockholder as a capital asset, the gain or loss will be capital gain or
loss.
13.
It is more likely than not that the fair market value of the nontransferable
subscription rights to purchase Oritani common stock is zero. Accordingly, no gain or
loss will be recognized by Eligible Account Holders, Supplemental Eligible Account
Holders or Other Members upon distribution to them of nontransferable subscription
rights to purchase shares of Oritani
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common stock. Eligible Account Holders, Supplemental Eligible Account Holders and Other
Members will not realize any taxable income as the result of the exercise by them of
the nontransferable subscriptions rights.
14.
It is more likely than not that the fair market value of the benefit provided
by the liquidation account of Oritani Bank supporting the payment of the Oritani
liquidation account in the event Oritani lacks sufficient net assets is zero.
Accordingly, it is more likely than not that no gain or loss will be recognized by
Eligible Account Holders and Supplemental Eligible Account Holders upon the
constructive distribution to them of such rights in the Oritani Bank liquidation
account as of the effective date of the merger of Oritani Financial Corp. with and into
Oritani. (Section 356(a) of the Internal Revenue Code.)
15.
It is more likely than not that the basis of the shares of Oritani common stock
purchased in the offering by the exercise of nontransferable subscription rights will
be the purchase price. The holding period of the Oritani common stock purchased
pursuant to the exercise of nontransferable subscription rights will commence on the
date on which the right to acquire such stock was exercised.
16.
No gain or loss will be recognized by Oritani on the receipt of money in
exchange for Oritani common stock sold in the offering.
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STOCKHOLDERS OF ORITANI FINANCIAL CORP.
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(i)
it does not involve an interim savings institution;
(ii)
Oritani Financial Corp.s federal stock charter is not changed;
(iii)
each share of Oritani Financial Corp.s stock outstanding immediately prior to
the effective date of the transaction will be an identical outstanding share or a
treasury share of Oritani Financial Corp. after such effective date; and
(iv)
either:
(a)
no shares of voting stock of Oritani Financial Corp. and no
securities convertible into such stock are to be issued or delivered under the
plan of combination; or
(b)
the authorized but unissued shares or the treasury shares of
voting stock of Oritani Financial Corp. to be issued or delivered under the
plan of combination, plus those initially issuable upon conversion of any
securities to be issued or delivered under such plan, do not exceed 15% of the
total shares of voting stock of Oritani Financial Corp. outstanding immediately
prior to the effective date of the transaction.
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the economic effect, both immediate and long-term, upon Oritanis stockholders,
including stockholders, if any, who do not participate in the transaction;
the social and economic effect on the present and future employees, creditors and
customers of, and others dealing with, Oritani and its subsidiaries and on the
communities in which Oritani and its subsidiaries operate or are located;
whether the proposal is acceptable based on the historical, current or projected
future operating results or financial condition of Oritani;
whether a more favorable price could be obtained for Oritanis stock or other
securities in the future;
the reputation and business practices of the other entity to be involved in the
transaction and its management and affiliates as they would affect the employees of
Oritani and its subsidiaries;
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the future value of the stock or any other securities of Oritani or the other entity
to be involved in the proposed transaction;
any antitrust or other legal and regulatory issues that are raised by the proposal;
the business and historical, current or expected future financial condition or
operating results of the other entity to be involved in the transaction, including, but
not limited to, debt service and other existing financial obligations, financial
obligations to be incurred in connection with the proposed transaction, and other
likely financial obligations of the other entity to be involved in the proposed
transaction; and
the ability of Oritani to fulfill its objectives as a financial institution holding
company and on the ability of its subsidiary financial institution(s) to fulfill the
objectives of a federally insured financial institution under applicable statutes and
regulations.
(i)
The limitation on voting rights of persons who directly or indirectly
beneficially own more than 10.0% of the outstanding shares of common stock;
(ii)
The division of the Board of Directors into three staggered classes;
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(iii)
The ability of the Board of Directors to fill vacancies on the board;
(iv)
The requirement that at least a majority of the votes eligible to be cast by
stockholders must vote to remove directors, and can only remove directors for cause;
(v)
The ability of the Board of Directors to amend and repeal the bylaws;
(vi)
The ability of the Board of Directors to evaluate a variety of factors in
evaluating offers to purchase or otherwise acquire Oritani;
(vii)
The authority of the Board of Directors to provide for the issuance of
preferred stock;
(viii)
The validity and effectiveness of any action lawfully authorized by the affirmative
vote of the holders of a majority of the total number of outstanding shares of common
stock;
(ix)
The number of stockholders constituting a quorum or required for stockholder
consent;
(x)
The indemnification of current and former directors and officers, as well as
employees and other agents, by Oritani;
(xi)
The limitation of liability of officers and directors to
Oritani for money damages;
(xii)
The inability of stockholders to cumulate their votes in the election of directors;
(xiii)
The advance notice requirements for stockholder proposals and nominations; and
(xiv)
The provision of the certificate of incorporation requiring approval of at
least 80% of the outstanding voting stock to amend the provisions of the certificate of
incorporation provided in (i) through (xiii) of this list.
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the economic effect, both immediate and long-term, upon Oritanis stockholders,
including stockholders, if any, who do not participate in the transaction;
the social and economic effect on the present and future employees, creditors and
customers of, and others dealing with, Oritani and its subsidiaries and on the
communities in which Oritani and its subsidiaries operate or are located;
whether the proposal is acceptable based on the historical, current or projected
future operating results or financial condition of Oritani;
whether a more favorable price could be obtained for Oritanis stock or other
securities in the future;
the reputation and business practices of the other entity to be involved in the
transaction and its management and affiliates as they would affect the employees of
Oritani and its subsidiaries;
the future value of the stock or any other securities of Oritani or the other entity
to be involved in the proposed transaction;
any antitrust or other legal and regulatory issues that are raised by the proposal;
the business and historical, current or expected future financial condition or
operating results of the other entity to be involved in the transaction, including, but
not limited to, debt service and other existing financial obligations, financial
obligations to be incurred in connection with the proposed transaction, and other
likely financial obligations of the other entity to be involved in the proposed
transaction; and
the ability of Oritani to fulfill its objectives as a financial institution holding
company and on the ability of its subsidiary financial institution(s) to fulfill the
objectives of a federally insured financial institution under applicable statutes and
regulations.
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(i)
the acquisition would result in a monopoly or substantially lessen competition;
(ii)
the financial condition of the acquiring person might jeopardize the financial
stability of the institution; or
(iii)
the competence, experience or integrity of the acquiring person indicates that
it would not be in the interest of the depositors or the public to permit the
acquisition of control by such person.
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The consolidated financial statements of Oritani Financial Corp. and subsidiaries as of
June 30, 2009 and 2008, and for each of the years in the three-year period ended June 30, 2009,
have been included herein in reliance upon the report of KPMG LLP, independent registered public
accounting firm, which is included herein and upon the authority of said firm as experts in
accounting and auditing.
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F-2
F-3
F-4
F-5
F-6
F-8
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Township of Washington, New Jersey
Oritani Financial Corp.
Township of Washington, New Jersey:
Short Hills, New Jersey
September 11, 2009
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Township of Washington, New Jersey
June 30,
(Unaudited)
Assets
December 31, 2009
2009
2008
(Dollars in thousands)
$
5,479
$
7,729
$
7,332
20,853
127,640
1,558
26,332
135,369
8,890
1,357,157
1,278,623
1,007,077
320,439
144,419
22,285
86,182
118,817
163,950
98,513
128,603
149,209
29,973
29,385
26,425
25,481
25,549
21,547
8,786
7,967
5,646
5,836
5,767
5,564
1,222
1,338
3,681
600
14,730
13,777
9,287
31,623
23,907
19,733
$
2,006,874
$
1,913,521
$
1,443,294
$
1,210,507
$
1,127,630
$
698,932
507,439
508,991
433,672
9,347
8,301
7,024
3,884
2,699
4,143
24,966
25,802
20,548
1,758,924
1,673,423
1,164,319
130
130
130
132,339
130,375
128,656
(13,512
)
(13,909
)
(14,704
)
(54,649
)
(53,418
)
(5,926
)
182,528
176,199
171,160
1,114
721
(341
)
247,950
240,098
278,975
$
2,006,874
$
1,913,521
$
1,443,294
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Township of Washington, New Jersey
(in thousands, except per share data)
(Unaudited)
Six months ended
December 31,
Years ended June 30,
2009
2008
2009
2008
2007
$
42,065
$
34,645
$
72,158
$
55,053
$
44,278
717
535
1,069
999
1,073
3,738
633
2,468
1,716
868
1,918
3,032
5,615
7,409
9,475
2,718
3,673
7,046
4,710
813
90
1
73
1,704
6,842
51,246
42,519
88,429
71,591
63,349
12,123
11,116
24,262
23,865
23,682
10,494
9,940
20,238
13,343
9,147
22,617
21,056
44,500
37,208
32,829
28,629
21,463
43,929
34,383
30,520
5,050
5,375
9,880
4,650
1,210
23,579
16,088
34,049
29,733
29,310
756
608
1,122
1,126
1,119
710
702
1,294
1,314
1,205
608
543
1,124
1,192
1,084
588
543
1,127
1,060
984
(190
)
(1,800
)
(2,045
)
(998
)
1,043
1,096
514
98
72
158
146
403
3,613
668
2,780
4,936
5,309
10,216
9,029
18,670
13,923
11,213
329
264
635
470
510
1,104
923
2,088
1,595
1,575
546
529
1,069
1,058
1,031
1,159
60
1,774
92
93
9,110
1,640
1,611
3,021
2,353
1,717
14,994
12,416
27,257
19,491
25,249
12,198
4,340
9,572
15,178
9,370
4,786
1,795
4,020
6,218
(1,664
)
$
7,412
$
2,545
$
5,552
$
8,960
$
11,034
$
7,206
$
2,495
$
5,459
$
8,790
$
11,034
$
0.20
$
0.07
$
0.15
$
0.23
$
0.15
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Township of Washington, New Jersey
For the six months ended December 31, 2009 (Unaudited) and the years ended June 30, 2009, 2008 and
2007
(in thousands, except share data)
Accumulated
Unallocated
other
Total
Additional
common
comprehensive
stock-
Common
paid-in
Treasury
stock held
Retained
(loss)
holders'
Stock
capital
Stock
by
ESOP
income
net of tax
equity
$
$
$
$
$
150,266
$
(130
)
$
150,136
11,034
11,034
3
3
132
132
11,169
130
127,500
127,630
(15,896
)
(15,896
)
(1,076
)
(1,076
)
210
397
607
$
130
$
127,710
$
$
(15,499
)
$
161,300
$
(1,071
)
$
272,570
8,960
8,960
256
256
382
382
92
92
9,690
900
900
(5,926
)
(5,926
)
610
610
336
795
1,131
$
130
$
128,656
$
(5,926
)
$
(14,704
)
$
171,160
$
(341
)
$
278,975
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Township of Washington, New Jersey
(in thousands, except share data)
Accumulated
Unallocated
other
Total
Additional
common
comprehensive
stock-
Common
paid-in
Treasury
stock held
Retained
(loss)
holders
Stock
capital
Stock
by ESOP
income
net of tax
equity
5,552
5,552
203
203
1,231
1,231
(372
)
(372
)
6,614
(437
)
(437
)
(76
)
(76
)
(49,989
)
(49,989
)
(2,497
)
2,497
3,804
3,804
412
795
1,207
$
130
$
130,375
$
(53,418
)
$
(13,909
)
$
176,199
$
721
$
240,098
7,412
7,412
265
265
58
58
70
70
7,805
(1,083
)
(1,083
)
(1,231
)
(1,231
)
1,782
1,782
140
397
537
42
42
$
130
$
132,339
$
(54,649
)
$
(13,512
)
$
182,528
$
1,114
$
247,950
Table of Contents
Township of Washington, New Jersey
(in thousands)
(Unaudited)
Six months ended
December 31,
Years ended June 30,
2009
2008
2009
2008
2007
$
7,412
$
2,545
$
5,552
$
8,960
$
11,034
8,110
2,319
2,409
5,011
1,741
607
395
321
701
540
718
1
43
62
237
463
5,050
5,375
9,880
4,650
1,210
(457
)
(379
)
(797
)
(779
)
(702
)
(1,135
)
(3,144
)
(4,487
)
(1,482
)
(9,159
)
202
1,751
2,045
998
(12
)
49
(1,043
)
(1,096
)
(514
)
212
(588
)
(544
)
(1,127
)
(1,060
)
(984
)
(440
)
(504
)
(818
)
(660
)
(708
)
(608
)
(543
)
(1,124
)
(1,192
)
(1,084
)
(819
)
(1,211
)
(2,321
)
(673
)
(1,063
)
(6,712
)
1,132
(1,076
)
(1,292
)
(331
)
3,596
3,552
3,557
2,041
5,575
7,373
10,852
15,058
10,933
13,172
(84,245
)
(169,080
)
(243,561
)
(241,106
)
(109,026
)
(3,694
)
(32,231
)
(37,068
)
(11,300
)
(6,960
)
4,000
(5,000
)
(251,027
)
(25,000
)
(163,679
)
(17,718
)
(35,000
)
(4,886
)
(10,116
)
(11,257
)
(124,033
)
(27,023
)
68
(2,603
)
(4,002
)
(10,928
)
(1,252
)
23,075
19,590
44,928
53,083
61,735
24,042
11,640
34,562
14,710
5,692
5,415
13,000
75,000
10,000
38,895
30,000
10,000
9,361
6,087
500
250
500
(1,120
)
(1,833
)
(1,290
)
(1,352
)
(1,378
)
(238
)
398
348
725
552
585
1,182
1,159
(387
)
(30
)
(1,090
)
(30
)
917
843
1,848
1,841
1,182
(1,348
)
(891
)
(1,500
)
(1,466
)
(409
)
1,973
(196,071
)
(199,690
)
(343,884
)
(301,169
)
(95,657
)
82,877
181,014
428,698
3,175
7,111
322,225
341,225
244,885
113,400
(1,552
)
(264,402
)
(265,906
)
(7,874
)
(85,975
)
1,046
1,129
1,277
1,340
577
119,520
(15,896
)
(1,521
)
(1,231
)
(38,217
)
(49,989
)
(5,926
)
42
79,661
201,749
455,305
235,600
138,737
(109,037
)
12,911
126,479
(54,636
)
56,252
135,369
8,890
8,890
63,526
7,274
$
26,332
$
21,801
$
135,369
$
8,890
$
63,526
$
22,766
$
20,819
$
44,262
$
36,296
$
32,589
2,674
4,646
9,812
9,583
5,647
812
3,690
3,690
(544
)
Table of Contents
Township of Washington, New Jersey
Table of Contents
Township of Washington, New Jersey
Table of Contents
Township of Washington, New Jersey
Table of Contents
Township of Washington, New Jersey
Table of Contents
Township of Washington, New Jersey
Table of Contents
Township of Washington, New Jersey
Table of Contents
Township of Washington, New Jersey
(Unaudited)
December 31,
June 30,
2009
2009
2008
(In thousands)
260,056
265,962
223,087
296,314
277,589
237,490
628,507
562,138
359,681
1,184,877
1,105,689
820,258
51,036
54,769
59,886
124,898
130,831
138,195
21,612
10,993
4,880
1,382,423
1,302,282
1,023,219
3,102
2,979
2,610
22,164
20,680
13,532
$
1,357,157
$
1,278,623
1,007,077
Table of Contents
Township of Washington, New Jersey
(Unaudited)
Six months ended
December 31,
Years ended June 30,
2009
2008
2009
2008
2007
(In thousands)
$
20,680
$
13,532
$
13,532
8,882
7,672
5,050
5,375
9,880
4,650
1,210
3
3,569
2,732
$
22,164
$
18,907
$
20,680
13,532
8,882
Table of Contents
Township of Washington, New Jersey
December 31, 2009 and 2008 (Unaudited) and June 30, 2009, 2008 and 2007
December 31, 2009 (unaudited)
Gross
Gross
Estimated
Amortized
unrealized
unrealized
fair
cost
gains
losses
value
(In thousands)
$
15,740
396
1
16,135
24,589
712
25,301
2,423
5
2
2,426
43,430
931
44,361
$
86,182
2,044
3
88,223
June 30, 2009
Gross
Gross
Estimated
Amortized
unrealized
unrealized
market
cost
gains
losses
value
(In thousands)
$
18,783
287
7
19,063
31,329
616
2
31,943
5,161
16
20
5,157
63,544
913
239
64,218
$
118,817
1,832
268
120,381
June 30, 2008
Gross
Gross
Estimated
Amortized
unrealized
unrealized
market
cost
gains
losses
value
(In thousands)
$
25,082
156
336
24,902
42,066
223
196
42,093
6,055
8
23
6,040
90,747
146
1,257
89,636
$
163,950
533
1,812
162,671
Table of Contents
Township of Washington, New Jersey
December 31, 2009 and 2008 (Unaudited) and June 30, 2009, 2008 and 2007
December 31, 2009 (unaudited)
Less than 12 months
Greater than 12 months
Total
(In thousands)
Gross
Gross
Gross
Estimated
unrealized
Estimated
unrealized
Estimated
unrealized
fair value
losses
fair value
losses
fair value
losses
$
859
2
859
2
1,749
1
1,749
1
$
2,608
3
2,608
3
June 30, 2009
Less than 12 months
Greater than 12 months
Total
(In thousands)
Gross
Gross
Gross
Estimated
unrealized
Estimated
unrealized
Estimated
unrealized
market value
losses
market value
losses
market value
losses
$
805
2
1,012
5
1,817
7
845
2
845
2
2,009
20
2,009
20
8,214
43
2,284
196
10,498
239
$
9,864
47
5,305
221
15,169
268
Table of Contents
Township of Washington, New Jersey
December 31, 2009 and 2008 (Unaudited) and June 30, 2009, 2008 and 2007
June 30, 2008
Less than 12 months
Greater than 12 months
Total
(In thousands)
Gross
Gross
Gross
Estimated
unrealized
Estimated
unrealized
Estimated
unrealized
market value
losses
market value
losses
market value
losses
$
11,191
226
3,035
110
14,226
336
8,068
45
17,580
151
25,648
196
495
1
2,286
22
2,781
23
23,628
70
50,742
1,187
74,370
1,257
$
43,382
342
73,643
1,470
117,025
1,812
Table of Contents
Township of Washington, New Jersey
December 31, 2009 (unaudited)
Gross
Gross
Estimated
Amortized
unrealized
unrealized
market
cost
gains
losses
value
(In thousands)
$
310,775
1,010
591
311,194
2,000
83
2,083
5,148
213
5,361
1,763
54
16
1,801
$
319,686
1,360
607
320,439
$
22,352
993
45
23,300
20,267
978
21,245
52,566
1,402
53,968
$
95,185
3,373
45
98,513
June 30, 2009
Gross
Gross
Estimated
Amortized
unrealized
unrealized
market
cost
gains
losses
value
(In thousands)
$
109,754
525
205
110,074
25,000
7
244
24,763
2,000
156
2,156
5,636
40
5,676
1,965
15
230
1,750
$
144,355
743
679
144,419
$
26,979
945
49
27,875
27,023
889
1
27,911
2,537
21
1
2,557
68,571
1,689
70,260
$
125,110
3,544
51
128,603
Table of Contents
Township of Washington, New Jersey
June 30, 2008
Gross
Gross
Estimated
Amortized
unrealized
unrealized
market
cost
gains
losses
value
(In thousands)
$
10,000
135
9,865
2,000
184
2,184
7,782
7,782
2,364
292
202
2,454
$
22,146
476
337
22,285
$
28,672
263
98
28,837
31,084
113
302
30,895
3,134
13
4
3,143
85,351
1,160
177
86,334
$
148,241
1,549
581
149,209
Table of Contents
Township of Washington, New Jersey
June 30, 2009
Less than 12 months
Greater than 12 months
Total
Gross
Gross
Gross
Estimated
unrealized
Estimated
unrealized
Estimated
unrealized
market value
losses
market value
losses
market value
losses
(In thousands)
$
79,202
449
79,202
449
654
230
654
230
$
79,856
679
79,856
679
$
4,501
49
4,501
49
1,801
1
1,801
1
501
1
501
1
$
6,803
51
6,803
51
Table of Contents
Township of Washington, New Jersey
June 30, 2008
Less than 12 months
Greater than 12 months
Total
Gross
Gross
Gross
Estimated
unrealized
Estimated
unrealized
Estimated
unrealized
market value
losses
market value
losses
market value
losses
(In thousands)
$
9,865
135
9,865
135
1,022
202
1,022
202
$
10,887
337
10,887
337
$
14,086
95
716
3
14,802
98
17,677
302
17,677
302
344
1
474
3
818
4
19,022
177
19,022
177
$
51,129
575
1,190
6
52,319
581
(Unaudited)
December 31,
June 30,
2009
2009
2008
(In thousands)
$
5,892
$
5,796
4,269
680
934
1,214
2,214
1,237
163
$
8,786
$
7,967
5,646
Table of Contents
Township of Washington, New Jersey
(Unaudited)
December 31,
June 30,
2009
2009
2008
(In thousands)
$
4,171
$
4,171
3,431
8,762
8,708
5,600
3,430
3,147
2,859
959
718
633
5,333
5,222
4,651
1,238
612
213
23,893
22,578
17,387
9,163
8,801
8,100
$
14,730
$
13,777
9,287
Table of Contents
Township of Washington, New Jersey
(Unaudited)
December31,
June 30,
2009
2009
2008
Weighted
Weighted
Weighted
average
average
average
Amount
cost
Amount
cost
Amount
cost
(Dollars in thousands)
$
106,968
0.75
%
$
88,759
0.90
%
$
73,949
0.89
%
271,583
1.43
199,965
2.07
57,117
2.92
146,442
0.79
147,669
1.04
149,062
1.35
685,514
2.32
691,237
2.84
418,804
3.84
$
1,210,507
1.80
%
$
1,127,630
2.32
%
$
698,932
2.92
%
(Unaudited)
Six months ended
December 31,
Years ended June 30,
2009
2008
2009
2008
2007
(In thousands)
$
404
$
323
$
628
812
868
2,008
1,076
2,626
1,730
1,195
675
1,069
1,979
2,427
2,575
9,036
8,648
19,029
18,896
18,526
518
$
12,123
$
11,116
$
24,262
23,865
23,682
(Unaudited)
December 31,
June 30,
2009
2009
$
583,794
$
601,316
83,408
67,014
11,191
16,295
3,746
3,586
3,375
3,026
$
685,514
$
691,237
Table of Contents
Township of Washington, New Jersey
(Unaudited)
Six months ended
December 31,
Years ended June 30,
2009
2008
2009
2008
2007
(In thousands)
$
4,692
$
4,822
$
7,749
7,210
6,833
1,229
117
758
490
662
5,921
4,939
8,507
7,700
7,495
(833
)
(3,492
)
(4,749
)
(2,724
)
(3,312
)
(302
)
348
262
1,242
(5,847
)
(1,135
)
(3,144
)
(4,487
)
(1,482
)
(9,159
)
$
4,786
$
1,795
$
4,020
6,218
(1,664
)
Table of Contents
Township of Washington, New Jersey
(Unaudited)
Six months ended
December 31,
Yeasrs ended June 30,
2009
2008
2009
2008
2007
(In thousands)
$
12,198
4,340
9,572
15,178
9,370
35
%
35
%
35
%
35
%
35
%
4,269
1,519
3,350
5,312
3,280
603
302
663
1,128
(3,370
)
(206
)
(190
)
(395
)
(371
)
(344
)
(1,533
)
49
90
144
118
74
64
53
209
26
7
21
49
5
229
$
4,786
1,795
4,020
6,218
(1,664
)
Table of Contents
Township of Washington, New Jersey
(Unaudited)
December 31,
June 30,
2009
2009
2008
(In thousands)
$
9,054
8,448
5,528
1,619
1,456
213
253
265
291
5,035
4,754
3,859
2,180
2,088
1,701
974
812
487
1,255
601
219
37
1,271
1,317
408
2,772
3,286
4,154
1,024
146
146
146
217
250
265
24,776
23,423
18,332
697
655
611
24,079
22,768
17,721
1,667
1,465
450
245
280
132
590
333
170
2,502
2,078
752
$
21,577
20,690
16,969
Table of Contents
Township of Washington, New Jersey
(Unaudited)
June 30,
December 31, 2009
2009
2008
Weighted
Weighted
Weighted
Amount
Average Rate
Amount
Average Rate
Amount
Average Rate
(Dollars in thousands)
$
507,098
3.96
%
$
508,619
3.96
%
$
433,289
4.00
%
341
0.25
%
372
0.25
%
383
2.00
%
$
507,439
3.96
%
$
508,991
3.96
%
$
433,672
4.00
%
Table of Contents
Township of Washington, New Jersey
(Unaudited)
December 31, 2009
June 30, 2009
$
10,341
$
10,372
36,413
5,434
20,000
52,500
67,500
40,000
63,185
70,685
310,000
330,000
$
507,439
$
508,991
Table of Contents
Township of Washington, New Jersey
The Company is a participant in the Financial Institutions Retirement Fund, a multi-employer
defined benefit plan. All employees who attain age 21 and complete one year of service are
eligible to participate in this plan. Retirement benefits are based upon a formula utilizing
years of service and average compensation, as defined. Participants are vested 100% upon the
completion of five years of service. Pension administrative expenses of $31,445, $21,000 and
$10,000 were incurred for the years ended June 30, 2009, 2008 and 2007, respectively. There
were no net contributions made for the years ended June 30, 2009, 2008 and 2007. The Plan
was frozen as of December 31, 2008.
The Financial Institutions Retirement Fund does not segregate its assets, liabilities or
costs by participating employer. Therefore, disclosure of the accumulated benefit
obligations, plan assets and the components of annual pension expense attributable to the
Company cannot be ascertained.
The Company has a savings incentive plan covering substantially all employees of the Company.
Contributions are currently made by the Company in an amount equal to 50% of the first 6% of
employee contributions. The contribution percentage is determined annually by the Board of
Directors. Company contributions for the six months ended December 31, 2009 and 2008 and the
years ended June 30, 2009, 2008 and 2007 were $63,000, $59,000, $133,000, $120,000 and
$123,000, respectively.
The Company has a nonqualified savings incentive plan covering employees whose salary
deferrals to the savings incentive plan are limited. Contributions to the nonqualified
savings incentive plan are currently made by the Company in an amount equal to 50% of the
first 6% of employee contributions to this plan. The contribution percentage is determined
annually by the Board of Directors. The deferrals and contributions are payable, with
interest, at a future date. Until these payments are made, the obligations to the employees
are a general liability of the Company. Company contributions for the six months ended
December 31, 2009 and 2008 and the years ended June 30, 2009, 2008 and 2007 were $61,000,
$38,000, $62,000, $42,000 and $21,000, respectively. The total obligation under the
nonqualified savings incentive plan that existed as of June 30, 2009 and 2008 was $1.9
million and $1.4 million, respectively.
The Company has a nonqualified Benefit Equalization Plan (BEP Plan) which provides benefits
to employees who are disallowed certain benefits under the Companys qualified benefit plans.
The Company recorded expenses associated with the BEP Plan of $90,000, $109,000, $201,000,
$180,000 and $143,000 for the six months ended December 31, 2009 and 2008 and the years ended
June 30, 2009, 2008 and 2007, respectively. The Plan was frozen as of December 31, 2008
resulting in a curtailment of benefits of $454,000.
The Company has a nonqualified Directors Retirement Plan (the Retirement Plan). The
Retirement Plan provides eligible directors an annual retirement benefit based on the
monthly meeting fee at the time of the directors retirement. The Company recorded expenses
of $264,000, $196,000, $445,000, $420,000 and $391,000 for the six months ended December 31,
2009 and 2008 and the years ended June 30, 2009, 2008 and 2007, respectively, related to the
Retirement Plan.
During 1999, the Company adopted a Post Retirement Medical Plan (the Medical Plan) for
directors and certain eligible employees. The Medical Plan provides a medical retirement
benefit at
Table of Contents
Township of Washington, New Jersey
a cost to the Company limited to two times the premium at the time of the participants
retirement. Participants are required to contribute to the plan for excess premiums above the
limitation. The Company recorded expenses of $147,000, $145,000, $247,000, $300,000 and
$337,000 for the six months ended December 31, 2009 and 2008 and the years ended June 30,
2009, 2008 and 2007, respectively, related to the Medical Plan.
During 2000, the Company adopted a Deferred Directors Fee Plan (the Deferred Fee Plan) for
outside directors of the Company. Under the Deferred Fee Plan, directors may elect to defer
the receipt of their monthly and board committee fees. The fees are payable, with interest,
at a predetermined future date. Interest is calculated at the greater of 9.00% or the Wall
Street prime rate of interest. For the years ended June 30, 2009 and 2008, interest was
calculated at 9.00%. Until these payments are made, the obligations to the directors are a
general liability of the Company. The total obligation under the Deferred Fee Plan that
existed as of December 31, 2009 and June 30, 2009 and 2008 was $3.1 million, $2.8 million and
$2.2 million, respectively.
During 2005, the Company adopted an Executive Supplemental Retirement Income Agreement (the
SERP) for the President/CEO of the Company. The SERP provides a retirement benefit to the
executive with a minimum payment period of 20 years. The SERP benefit is equal to 70% of the
executives average annual pre-retirement income, reduced by the benefits due to the
executive through certain other benefit plans. The Company recorded expenses of $424,000,
$361,000, $806,000, $689,000 and $648,000 for the six months ended December 31, 2009 and 2008
and the years ended June 30, 2009, 2008 and 2007, respectively, related to the SERP. The
SERP is unfunded, and an accrued liability of $3.3 million, $2.8 million and $2.0 million was
recorded for this plan as of December 31, 2009 and June 30, 2009 and 2008, respectively.
Table of Contents
Township of Washington, New Jersey
BEP Plan and
Retirement Plan
Medical Plan
2009
2008
2009
2008
$
3,748
$
3,421
$
2,600
$
2,694
231
256
64
58
284
221
199
163
850
135
371
(61
)
(454
)
(52
)
(52
)
(58
)
(52
)
162
(233
)
256
(202
)
$
4,769
$
3,748
$
3,432
$
2,600
$
$
$
$
52
52
58
52
(52
)
(52
)
(58
)
(52
)
$
$
$
$
$
(4,769
)
$
(3,748
)
$
(3,432
)
$
(2,600
)
Plan
Medical Plan
2009
2008
2009
2008
$
358
$
418
$
$
916
429
1,008
448
$
1,274
$
847
$
1,008
$
448
Table of Contents
Township of Washington, New Jersey
BEP Plan and Retirement Plan
(Unaudited)
Six months ended
December 31,
Years ended Jun 30,
2009
2008
2009
2008
2007
$
127
$
135
$
231
$
256
$
234
158
117
284
221
195
30
30
60
60
61
39
23
70
44
44
$
354
$
305
$
645
$
581
$
534
Medical Plan
(Unaudited)
Six months ended
December 31,
Years ended Jun 30,
2009
2008
2009
2008
2007
$
28
$
30
$
64
$
58
$
54
89
86
199
163
157
2
4
64
30
27
67
51
62
$
147
$
145
$
330
$
276
$
337
BEP Plan and Retirement Plan
Medical Plan
2009
2008
2007
2009
2008
2007
6.25
%
6.75
%
6.25
%
6.25
%
6.75
%
6.25
%
5.50
%
5.50
%
5.50
%
9.00
%
7.00
%
8.00
%
Table of Contents
Township of Washington, New Jersey
BEP Plan and
Retirement
Medical
Plan
Plan
$
62
$
81
85
104
180
123
222
151
222
158
1,636
1,071
1% increase
1% decrease
$
54
$
(42
)
$
644
$
(507
)
The Company invests in bank owned life insurance (BOLI) to help offset the cost of
employee benefits. BOLI involves the purchasing of life insurance by the Company on a chosen
group of employees with the Company as owner and beneficiary of the policies. BOLI is
recorded at its cash surrender value and is classified as a non-interest earning asset.
Increases in the carrying value, other than purchases, are recorded as non-interest income.
At December 31, 2009 and June 30, 2009 and 2008, the Company had $30.0 million, $29.4 million
and $26.4 million, respectively, in BOLI. Income earned on BOLI was $588,000, $544,000, $1.1
million, $1.1 million and $984,000 for the six months ended December 31, 2009 and 2008 and
the years ended June 30, 2009, 2008 and 2007, respectively and is exempt from federal and
state income taxes as long as the policies are held until the death of the insured
individuals.
The Company adopted ASC 715-60,
Compensation: Defined Benefit Plans-Other Postretirement
,
effective July 1, 2008. ASC 715-60 requires that, for split-dollar life insurance
arrangements that provide a benefit to an employee that extends to postretirement periods, an
employer should recognize a liability for future benefits. ASC 715-60 required that
recognition of the effects of adoption should be either by (a) a change in accounting
principle through a cumulative-effect adjustment to retained earnings as of the beginning of
the year of adoption or (b) a change in accounting principle through retrospective
application to all prior periods. Upon adoption, the Company recorded a charge to retained
earnings of $76,000.
During 2006, the Company adopted an Employee Stock Ownership Plan (the ESOP). The ESOP is a
tax-qualified plan designed to invest primarily in the Companys common stock. The ESOP
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Township of Washington, New Jersey
provides employees with the opportunity to receive a funded retirement benefit from the Bank,
based primarily on the value of the Companys common stock. The ESOP purchased 1,589,644
shares of the Companys common stock in the Companys initial public offering at a price of
$10.00 per share. This purchase was funded with a loan from the Company to the ESOP. The
outstanding loan balance at December 31, 2009 and June 30, 2009 was $14.5 million and $15.1
million, respectively. The shares of Companys common stock purchased in the initial public
offering are pledged as collateral for the loan. Shares will be released from the pledge for
allocation to participants as loan payments are made. At December 31, 2009, shares allocated
to participants were 238,446 since the plan inception. ESOP shares that were unallocated or
not yet committed to be released totaled 1,351,198 at December 31, 2009 and had a fair value
of $18.5 million. ESOP compensation expense for the six months ended December 31, 2009 and
2008 and the years ended June 30, 2009 and 2008 was $537,000, $654,000, $1.3 million and $1.1
million, respectively, representing the fair market value of shares allocated or committed to
be released during the year.
The Company also has established an ESOP restoration plan, which is a non-qualified plan that
provides supplemental benefits to certain executives who are prevented from receiving the
full benefits contemplated by the employee stock ownership plans benefit formula. The
supplemental benefits consist of payments representing shares that cannot be allocated to
participants under the ESOP due to legal limitations imposed on tax-qualified plans.
Compensation expense related to this plan amounts to $57,000, $60,000, $111,000 and $200,000,
for the six months ended December 31, 2009 and 2008 and the years ended June 30, 2009 and
2008, respectively. There was expense related to this plan for the year ended June 30, 2007.
At the Special Meeting of Stockholders of the Company (the Meeting) held on April 22, 2008,
the stockholders of the Company approved the Oritani Financial Corp. 2007 Equity Incentive
Plan. On May 7, 2008, certain officers and employees of the Company were granted in
aggregate 1,311,457 stock options and 588,171 shares of restricted stock, and non-employee
directors received in aggregate 476,892 stock options and 206,652 shares of restricted stock.
On November 11, 2008, an additional 70,000 stock options were issued. The Company adopted
ASC 718,
Compensation: Stock Compensation
upon approval of the Plan, and began to expense
the fair value of all share-based compensation granted over the requisite service periods.
ASC 718- requires the Company to report as a financing cash flow the benefits of realized tax
deductions in excess of the deferred tax benefits previously recognized for compensation
expense. There were no such excess tax benefits in fiscal 2009, 2008 and 2007. The Company
classified share-based compensation for employees and outside directors within compensation
and fringe benefits in the consolidated statements of income to correspond with the same
line item as the cash compensation paid.
Stock options vest over a five-year service period and expire ten years from issuance. The
Company recognizes compensation expense for all option grants over the awards
respective requisite service periods. Management estimated the fair values of all option
grants using the Black-Scholes option-pricing model. Since there is limited historical
information on the volatility of the Companys stock, management considered the average
volatilities of similar entities for an appropriate period in determining the assumed
volatility rate used in the estimation of fair value. Management estimated the expected life
of the options using the simplified method. The Treasury
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Township of Washington, New Jersey
yield in effect at the time of the grant provides the risk-free rate for periods within the
contractual life of the option. The fair values of all options grants were estimated using
the following assumptions: an expected life of 6.5 years, risk-free rate of 3.37%, volatility
of 28.22% and a dividend yield of 3.55%. The Company recognizes compensation expense for the
fair values of these awards, which have graded vesting, on a straight-line basis over the
requisite service period of the awards.
The following is a summary of the Companys stock option activity and related information for
its option plan for the six months ended December 31, 2009 (unaudited) and the year ended
June 30, 2009:
Weighted Average
Weighted Average
Remaining
Number of
Grant Date Fair
Weighted Average
Contractual
Stock Options
Value
Exercise Price
Life (years)
1,848,349
$
3.44
$
15.65
9.0
6,624
3.44
15.65
8.8
1,841,725
$
3.44
$
15.65
8.4
368,345
$
15.65
Weighted Average
Weighted Average
Number of Stock
Grant Date Fair
Weighted Average
Remaining
Options
Value
Exercise Price
Contractual Life
1,788,349
$
3.44
$
15.65
10.0
70,000
3.44
15.65
10.0
10,000
3.44
15.65
9.1
1,848,349
$
3.44
$
15.65
9.0
355,670
$
15.65
The weighted average grant date fair value of options granted during the year ended June
30, 2009 was $3.44 per share. The Company recorded $572,000, $539,000, $1.2 million and
$205,000 of share based compensation expense related to the options granted for the six
months ended December 31, 2009 and 2008 and the years ended June 30, 2009 and 2008,
respectively. There was no share based compensation expense related to the options for the
year ended June 30, 2007. Expected future expense related to the non-vested options
outstanding at December 31, 2009 is $3.8 million over a weighted average period of 3.4 years.
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Township of Washington, New Jersey
Restricted shares vest over a five-year service period on the anniversary date of the grant.
The product of the number of shares granted and the grant date market price of the Companys
common stock determines the fair value of restricted shares under the Companys restricted
stock plan. The Company recognizes compensation expense for the fair value of restricted
shares on a straight-line basis over the requisite service period.
The following is a summary of the Companys restricted shares and related information for its
restricted shares for the six months ended December 31, 2009 (unaudited) and the year ended
June 30, 2009:
Weighted Average
Number of
Grant Date Fair
Weighted Average
Shares Awarded
Value
Vesting
635,859
$
15.65
3.9
635,859
$
15.65
3.3
Weighted Average
Number of Shares
Grant Date Fair
Weighted Average
Awarded
Value
Vesting
794,823
$
15.65
4.9
158,964
15.65
3.9
635,859
$
15.65
3.9
The Company recorded $1.2 million, $1.2 million, $2.6 million and $405,000 of
share-based compensation expense related to restricted shares for the six months ended
December 31, 2009 and 2008 and the years ended June 30, 2009 and 2008, respectively. There
was no share based compensation expense related to the restricted shares for the year ended
June 30, 2007. Expected future compensation expense relating to the non-vested restricted
shares at December 31, 2009 is $8.1 million over a weighted average period of 3.3 years.
Table of Contents
Township of Washington, New Jersey
In the ordinary course of our operations, we enter into certain contractual obligations.
Such obligations include operating leases for premises and equipment. Certain facilities are
occupied under long-term operating leases which expire on various dates. Certain leases also
provide for renewal options. Total rent expense was $214,000, $180,000, $388,000
,
$302,000
and $304,000 for the six months ended December 31, 2009 and 2008 and the years ended June 30,
2009, 2008 and 2007, respectively. At December 31, 2009, aggregate minimum lease payments
for the remainder of the leases are as follows (in thousands):
$
289
289
257
217
158
370
$
1,580
At December 31, 2009 and June 30, 2009, the Company had outstanding commitments to purchase
when issued securities of $15.0 million and $20.0 million, respectively. At June 30, 2008,
there were no outstanding commitments to purchase securities.
In the normal course of business, the Company may be a party to various outstanding legal
proceedings and claims. In the opinion of management, the financial position of the Company
will not be materially affected by the outcome of such legal proceedings and claims.
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Township of Washington, New Jersey
Deposits at the Bank are insured up to standard limits of coverage provided by the Deposit
Insurance Fund (DIF) of the FDIC. The Bank is a New Jersey state chartered savings bank and
is subject to comprehensive regulation, supervision and periodic examinations by the FDIC and
by the New Jersey State Department of Banking. The Company is regulated by the Office of
Thrift Supervision (OTS).
FDIC regulations require banks to maintain minimum levels of regulatory capital. Under the
regulations in effect at December 31, 2009, the Bank and the Company are required to maintain
(a) a minimum leverage ratio of Tier 1 capital to total adjusted assets of 4.0%, and (b)
minimum ratios of Tier 1 and total capital to risk-weighted assets of 4.0% and 8.0%,
respectively.
Under its prompt corrective action regulations, the FDIC is required to take certain
supervisory actions (and may take additional discretionary actions) with respect to an
undercapitalized institution. Such actions could have a direct material effect on the
institutions financial statements. The regulations establish a framework for the
classification of savings institutions into five categories: well capitalized, adequately
capitalized, undercapitalized, significantly undercapitalized, and critically
undercapitalized. Generally, an institution is considered well capitalized if it has a
leverage (Tier 1) capital ratio of at least 5%; a Tier 1 risk-based capital ratio of at least
6%; and a total risk-based capital ratio of at least 10%.
The foregoing capital ratios are based in part on specific quantitative measures of assets,
liabilities and certain off-balance-sheet items as calculated under regulatory accounting
practices. Capital amounts and classifications are also subject to qualitative judgments by
the FDIC about capital components, risk weightings and other factors.
Management believes that, as of December 31, 2009, the Bank meets all capital adequacy
requirements to which it is subject. Further, the most recent FDIC notification categorized
the Bank as a well-capitalized institution under the prompt corrective action regulations.
There have been no conditions or events since that notification that management believes have
changed the Banks capital classification.
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Township of Washington, New Jersey
The following is a summary of the Companys and the Banks actual capital amounts and ratios
as of December 31, 2009 and June 30, 2009 and 2008, compared to the FDIC minimum capital
adequacy requirements and the FDIC requirements for classification as a well-capitalized
institution.
FDIC for
FDIC to be well capitalized
capital adequacy
under prompt
Actual
purposes
corrective action
Amount
Rate
Amount
Rate
Amount
Rate
(Dollars in thousands)
Company:
assets)
$
264,865
18.42
%
$
115,053
8.00
%
$
143,817
10.00
%
assets)
246,836
17.16
57,527
4.00
86,290
6.00
246,836
12.36
79,912
4.00
99,890
5.00
assets)
$
255,997
19.15
%
$
106,945
8.00
%
$
133,681
10.00
%
assets)
239,238
17.90
53,472
4.00
80,208
6.00
239,238
14.31
66,862
4.00
83,578
5.00
assets)
$
292,483
27.78
%
$
84,239
8.00
%
$
105,299
10.00
%
assets)
279,316
26.53
42,120
4.00
63,179
6.00
279,316
19.71
56,680
4.00
70,851
5.00
Table of Contents
Township of Washington, New Jersey
FDIC for
FDIC to be well capitalized
capital adequacy
under prompt
Actual
purposes
corrective action
Amount
Rate
Amount
Rate
Amount
Rate
(Dollars in thousands)
Bank:
assets)
$
209,882
15.83
%
$
106,101
8.00
%
132,626
10.00
%
assets)
193,248
14.57
53,050
4.00
79,575
6.00
193,248
10.59
72,963
4.00
91,204
5.00
assets)
$
209,882
15.83
%
$
106,101
8.00
%
132,626
10.00
%
assets)
193,248
14.57
53,050
4.00
79,575
6.00
193,248
10.59
72,963
4.00
91,204
5.00
assets)
$
202,862
19.76
%
$
82,121
8.00
%
$
102,651
10.00
%
assets)
190,022
18.51
41,060
4.00
61,591
6.00
190,022
13.67
55,609
4.00
69,512
5.00
The Company adopted ASC 820,
Fair Value Measurements and Disclosures"
, on July 1, 2008. ASC
820 establishes a fair value hierarchy that prioritizes the inputs to valuation techniques
used to measure fair value. The hierarchy gives the highest priority to unadjusted quoted
prices in active markets for identical assets or liabilities (level 1 measurements) and the
lowest priority to unobservable inputs (level 3 measurements). The three levels of the fair
value hierarchy under ASC 820 are described below:
Basis of Fair Value Measurement:
Level 1: Unadjusted quoted prices in active markets that are accessible at the
measurement date for identical unrestricted assets or liabilities;
Level 2: Quoted prices in markets that are not active, or inputs that are
observable either directly or indirectly, for substantially the full term of the
asset or liability;
Level 3: Price or valuation techniques that require inputs that are both
significant to the fair value measurement and unobservable (i.e. supported with
little or no market activity).
A financial instruments level within the fair value hierarchy is based on the lowest level
of input that is significant to the fair value measurement.
The Companys cash instruments are generally classified within Level 1 or Level 2 of the fair
value hierarchy because they are valued using quoted market prices, broker or dealer
quotations, or alternative pricing sources with reasonable levels of price transparency.
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Township of Washington, New Jersey
The types of instruments whose values are based on quoted market prices in active markets
include most U.S. government and agency securities, mortgage-backed securities, many other
sovereign government obligations, and active listed securities. Such instruments are generally
classified within Level 1 or Level 2 of the fair value hierarchy. As required by ASC 820, the
Company does not adjust the quoted price for such instruments.
The following table sets forth the Companys financial assets that were accounted for at fair
values on a recurring basis as of December 31, 2009 and June 30, 2009 by level within the fair
value hierarchy. As required by ASC 820, financial assets are classified in their entirety
based on the lowest level of input that is significant to the fair value measurements (in
thousands):
Quoted Prices
in Active
Significant
(Unaudited)
Markets for
Other
Fair Value as
Identical
Observable
Unobservable
of December 31,
Assets
Inputs
Inputs
2009
(Level 1)
(Level 2)
(Level 3)
$
320,439
$
56,871
$
263,568
$
98,513
98,513
$
418,952
$
56,871
$
362,081
$
Quoted Prices
in Active
Significant
Markets for
Other
Fair Value as
Identical
Observable
Unobservable
of June 30,
Assets
Inputs
Inputs
2009
(Level 1)
(Level 2)
(Level 3)
$
144,419
27,102
$
117,318
$
128,604
1,141
127,463
$
273,023
$
28,243
$
244,781
$
Also, the Company may be required, from time to time, to measure the fair value of
certain other financial assets on a nonrecurring basis in accordance with U.S. generally
accepted accounting principles. The adjustments to fair value usually result from the
application of lower-of-cost-or-market accounting or write downs of individual assets.
The Company had impaired loans with outstanding principal balances of $24.1 million, $20.0
million and $13.8 million at December 31, 2009 and June 30, 2009 and 2008, respectively, that
were recorded at their estimated fair value (less cost to sell) of $21.0 million, $16.7
million and $12.4 million at December 31, 2009 and June 30, 2009 and 2008, respectively.
Specific reserves for impaired loans totaled $3.1 million, $3.3 million and $1.4 million at
December 31, 2009 and June 30, 2009 and 2008, respectively. The Company recorded impairment
charges of $2.7 million, $740,000, $4.4 million and $1.4 million for the six months ended
December 31, 2009 and 2008 and the years ended June 30, 2009 and 2008, respectively, utilizing
Level 3 inputs. There were no impairment charges for the year ended June 30, 2007. Impaired
loans are valued utilizing current
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Township of Washington, New Jersey
appraisals adjusted downward by management, as necessary,
for changes in relevant valuation factors subsequent to the appraisal date.
(18)
Fair Value of Financial Instruments
ASC 825,
Financial Instruments
, requires that the Company disclose estimated fair values for
its financial instruments. Fair value estimates, methods and assumptions are set forth below
for the Companys financial instruments.
Cash and Cash Equivalents
For cash on hand and due from banks and federal funds sold and short-term investments, the
carrying amount approximates fair value.
Securities
The fair value of securities is estimated based on bid quotations received from securities
dealers, if available. If a quoted market price is not available, fair value is estimated
using quoted market prices of similar instruments, adjusted for differences between the quoted
instruments and the instruments being valued.
FHLB of New York Stock
The fair value for FHLB stock is its carrying value, since this is the amount for which it
could be redeemed. There is no active market for this stock and the Bank is required to
maintain a minimum balance based upon the unpaid principal of home mortgage loans.
Loans
Fair values are estimated for portfolios of loans with similar financial characteristics.
Loans are segregated by type such as residential mortgage, construction, land and consumer.
Each loan category is further segmented into fixed and adjustable rate interest terms and by
performing and nonperforming categories.
Fair value of performing loans is estimated by discounting cash flows using estimated market
discount rates at which similar loans would be made to borrowers and reflect similar credit
ratings and interest rate risk for the same remaining maturities. This method of estimating fair
value does not incorporate the exit-price concept of fair value prescribed by ASC 820,
Fair
Value Measurements and Disclosures.
Fair value for significant nonperforming loans is based on recent external appraisals of
collateral securing such loans, adjusted for the timing of anticipated cash flows.
Deposit Liabilities
The fair value of deposits with no stated maturity, such as noninterest-bearing demand
deposits, savings, and NOW and money market accounts, is equal to the amount payable on demand
as of December 31, 2009 and June 30, 2009 and 2008. The fair value of certificates of deposit
is based on the discounted value of contractual cash flows. The discount rate is estimated
using the rates currently offered for deposits of similar remaining maturities.
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Township of Washington, New Jersey
Borrowings
The fair value of borrowings due in six months or less is equal to the amount payable. The
fair value of all other borrowings is calculated based on the discounted cash flow of
contractual amounts due, using market rates currently available for borrowings of similar
amount and remaining maturity.
Commitments to Extend Credit and to Purchase or Sell Securities
The fair value of commitments to extend credit is estimated using the fees currently charged
to enter into similar agreements, taking into account the remaining terms of the agreements
and the present creditworthiness of the counterparties. For fixed rate loan commitments, fair
value also considers the difference between current levels of interest rates and the committed
rates. The fair value of commitments to purchase or sell securities is estimated based on bid
quotations received from securities dealers.
The estimated fair values of the Companys financial instruments are presented in the
following table. Since the fair value of off-balance-sheet commitments approximates book
value, these disclosures are not included.
(Unaudited)
June 30,
December 30, 2009
2009
2008
Carrying
Fair
Carrying
Fair
Carrying
Fair
value
value
value
value
value
value
$
26,332
26,332
$
135,369
135,369
8,890
8,890
320,439
320,439
144,419
144,419
22,285
22,285
86,182
88,223
118,817
120,381
163,950
162,671
98,513
98,513
128,603
128,603
149,209
149,209
25,481
25,481
25,549
25,549
21,547
21,547
1,357,157
1,374,712
1,278,623
1,292,394
1,007,077
999,366
1,210,507
1,212,923
1,127,630
1,106,212
698,932
700,582
507,439
543,451
508,991
547,202
433,672
445,162
Limitations
Fair value estimates are made at a specific point in time, based on relevant market
information and information about the financial instrument. These estimates do not reflect any
premium or discount that could result from offering for sale at one time the Companys entire
holdings of a particular financial instrument. Because no market exists for a significant
portion of the Companys financial instruments, fair value estimates are based on judgments
regarding future expected loss experience, current economic conditions, risk characteristics
of various financial instruments, and other factors. These estimates are subjective in nature
and involve uncertainties and matters of significant judgment and, therefore, cannot be
determined with precision. Changes in assumptions could significantly affect the estimates.
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Township of Washington, New Jersey
Fair value estimates are based on existing on- and off-balance-sheet financial instruments
without attempting to estimate the value of anticipated future business and the value of
assets and liabilities that are not considered financial instruments. Significant assets and
liabilities that are not considered financial assets or liabilities include the mortgage
banking operation, deferred tax assets, and premises and equipment. In addition, the tax
ramifications related to the realization of the unrealized gains and losses can have a
significant effect on fair value estimates and have not been considered in the estimates.
(19)
Parent Company Only Financial Statements
The following condensed financial information for Oritani Financial Corp. (parent company only)
reflect the investment in its wholly-owned subsidiaries, Oritani Bank, Oritani, LLC and
Hampshire Financial, LLC, using the equity method of accounting.
(Unaudited)
June 30,
December 31, 2009
2009
2008
(In thousands)
$
9,828
2,442
47,913
24,722
24,298
18,659
14,452
15,082
15,483
1,801
1,750
2,453
120
361
623
196,964
196,427
193,777
100
100
100
37
132
19
$
248,024
240,592
279,027
$
74
494
52
247,950
240,098
278,975
$
248,024
240,592
279,027
Table of Contents
Township of Washington, New Jersey
(Unaudited)
Six months ended December 31,
Years Ended June 30,
2009
2008
2009
2008
2007
(In thousands)
$
760
573
1,372
1,160
1,159
566
809
1,138
650
12
249
256
2,012
1,378
(202
)
(398
)
(398
)
(352
)
30
46
81
101
7,322
2,202
4,758
6,953
13,664
7,922
3,238
6,878
11,012
16,851
8,110
250
265
466
391
219
260
428
860
1,661
(2,512
)
510
693
1,326
2,052
5,817
$
7,412
2,545
5,552
8,960
11,034
Table of Contents
Township of Washington, New Jersey
(Unaudited)
Six months ended December 31,
Years Ended June 30,
2009
2008
2009
2008
2007
(In thousands)
$
7,412
2,545
5,552
8,960
11,034
8,110
202
398
398
352
9,765
96
10,241
372
281
(7,322
)
(2,202
)
(4,758
)
(6,953
)
(13,664
)
241
529
262
152
(706
)
94
18
(113
)
(19
)
(73
)
(16
)
436
16
10,319
1,368
12,018
2,880
5,055
(387
)
(1,226
)
(4,759
)
(1,410
)
(59,958
)
(2,715
)
(15,896
)
630
401
401
413
(424
)
149
(5,639
)
320
287
(181
)
(676
)
(9,997
)
(3,392
)
(75,567
)
(1,231
)
(38,217
)
(49,989
)
(5,926
)
2,497
119,520
(1,521
)
(2,752
)
(38,217
)
(47,492
)
(5,926
)
119,520
7,386
(37,525
)
(45,471
)
(6,438
)
49,008
2,442
47,913
47,913
54,351
5,343
$
9,828
10,388
2,442
47,913
54,351
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Township of Washington, New Jersey
(20)
Selected Quarterly Financial Data (Unaudited)
The following tables are a summary of certain quarterly financial data for the six months
ended December 31, 2009 and the years ended June 30, 2009 and 2008.
Fiscal 2010 Quarter Ended
September 30
December 31
(Dollars in thousands)
$
25,779
25,467
11,560
11,057
14,219
14,410
2,550
2,500
11,669
11,910
2,546
1,067
6,828
8,166
7,387
4,811
2,904
1,882
$
4,483
$
2,929
$
0.12
0.08
0.12
0.08
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Township of Washington, New Jersey
Fiscal 2009 Quarter Ended
September 30
December 31
March 31
June 30
(Dollars in thousands)
$
20,657
21,862
22,598
23,302
9,887
11,169
11,798
11,646
10,770
10,693
10,800
11,656
1,875
3,500
2,400
2,105
8,895
7,193
8,400
9,551
1,233
(565
)
822
1,290
5,874
6,542
6,652
8,179
4,254
86
2,570
2,662
1,748
47
1,067
1,158
$
2,506
$
39
1,503
1,504
$
0.07
0.04
0.04
0.07
0.04
0.04
Fiscal 2008 Quarter Ended
September 30
December 31
March 31
June 30
(Dollars in thousands)
$
17,043
17,722
18,318
18,508
8,758
9,325
9,594
9,531
8,285
8,397
8,724
8,977
350
950
750
2,600
7,935
7,447
7,974
6,377
1,329
1,174
791
1,642
4,218
4,922
4,751
5,600
5,046
3,699
4,014
2,419
2,073
1,504
1,649
992
$
2,973
$
2,195
2,365
1,427
$
0.08
0.06
0.06
0.04
During the fourth quarter of fiscal year 2008, the Company changed the method of
recording FHLB of New York capital stock dividends to a cash basis from an accrual basis.
This change in methodology decreased the fourth quarter interest income by $312,000.
(21)
Earnings Per Share
The following is a summary of the Companys earnings per share calculations and reconciliation
of basic to diluted earnings per share.
Table of Contents
Township of Washington, New Jersey
(Unaudited)
Six months ended December 31,
Years Ended June 30,
2009
2008
2009
2008
(in thousands, except earnings per share data)
$
7,412
2,545
5,552
8,960
(206
)
(50
)
(93
)
(170
)
$
7,206
$
2,495
$
5,459
$
8,790
35,687
37,515
36,738
39,028
35,687
37,515
36,738
39,028
$
0.20
$
0.07
$
0.15
$
0.23
The Company completed its initial public offering on January 24, 2007. Basic and diluted
earnings per common share for the period of January 24, 2007 to June 30, 2007 was $0.15,
calculated using net income of $5.2 million and weighted average common shares of 34,028,313
outstanding for the period. The number of shares outstanding for this purpose includes shares
held by Oritani Financial Corp., MHC, but excludes unallocated ESOP shares.
(22)
Recent Accounting Pronouncements
In September 2009, the FASB issued Accounting Standards Update (ASU) 2009-12, Investments
in Certain Entities that Calculate Net Asset Value per Share (or Its Equivalent). The update
provides guidance on estimating the fair value of a companys investments in investment
companies when the investment does not have a readily determinable fair value. It amends
topic 820 to permit the use of the investments net asset value as a practical expedient to
determine fair value. This guidance also requires additional disclosure of the attributes of
these investments such as; (i) the nature of any restrictions on the reporting entitys
ability to redeem its investment; (ii) unfunded commitments; and (iii) investment strategies
of the investees. This ASU is effective for the first reporting period ending after December
15, 2009, with earlier application permitted. The adoption of the ASU did not have a
material impact on its consolidated financial statements.
In August 2009, the FASB issued ASU 2009-05, Measuring Liabilities at Fair Value, which
updates topic 820, Fair Value Measurements and Disclosures. The updated guidance clarifies
that the fair value of a liability can be measured in relation to the quoted price of the
liability when it trades as an asset in an active market, without adjusting the price for
restrictions that prevent the sale of the liability. This guidance is effective for the first
interim or annual reporting period after issuance. The adoption of this guidance did not have
a material impact on its consolidated financial statements.
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Township of Washington, New Jersey
In June 2009, the FASB issued guidance which amends the derecognition guidance in ASC 860,
Transfer and Servicing,
to enhance reporting about transfers of financial assets, including
securitizations, and where companies having continuing exposure to the risks related to
transferred financial assets. The guidance eliminates the concept of qualifying
special-purpose entity, changes the requirements for derecognizing financial assets and
requires additional disclosures about all continuing involvements with transferred financial
assets including information about gains and losses resulting from transfers during the
period. This guidance is effective for financial asset transfers occurring in fiscal years
beginning after November 15, 2009. The Company does not expect the adoption of this guidance
to have a material impact on its consolidated financial statements.
In 2008, the FASB issued Staff Position No. FAS 132(R)-1, Employers Disclosures about
Postretirement Benefit Plan Assets (ASC Topic 715-20-65). This guidance will expand
disclosure by requiring the following new disclosures: 1) how investment allocation decisions
are made by management; 2) major categories of plan assets; and 3) significant concentrations
of risk. Additionally, ASC 715-20-65 will require an employer to disclose information about
the valuation of plan assets similar to that required in ASC topic 820
Fair Value
Measurements and Disclosures
. This guidance is effective for fiscal years beginning after
December 15, 2009. The Company does not expect the adoption to have a material effect on its
consolidated financial statements.
Table of Contents
Oritani Bank)
par value $0.01 per share
guaranteed.
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PROXY STATEMENT OF ORITANI FINANCIAL CORP., A FEDERAL CORPORATION
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370 Pascack Road
P.O. Box 128
Township of Washington, New Jersey 07676
(201) 664-5400
1.
The approval of a plan of conversion and reorganization pursuant to which: (a)
Oritani Financial Corp., MHC, a federal corporation will merge with and into Oritani
Financial Corp., with Oritani Financial Corp. being the surviving entity; (b) Oritani
Financial Corp., will merge with and into Oritani with, with Oritani being the
surviving entity; (c) the outstanding shares of Oritani Financial Corp., other than
those held by Oritani Financial Corp., MHC, will be converted into shares of common
stock of Oritani; and (e) Oritani will offer shares of its common stock for sale in a
subscription offering, and, if necessary, a community offering or syndicated community
offering;
2.
The approval of the adjournment of the special meeting, if necessary, to
solicit additional proxies in the event that there are not sufficient votes at the time
of the special meeting to approve the plan of conversion and reorganization;
3.
The following informational proposals:
3a.
Approval of a provision in Oritanis certificate of incorporation
to limit the ability of stockholders to remove directors;
3b.
Approval of a provision in Oritanis certificate of incorporation
requiring a super-majority vote to approve certain amendments to Oritanis
certificate of incorporation;
3c.
Approval of a provision in Oritanis bylaws requiring a
super-majority vote of stockholders to approve stockholder-proposed amendments to
Oritanis bylaws;
3d.
Approval of a provision in Oritanis certificate of incorporation
to limit the voting rights of shares beneficially owned in excess of 10% of
Oritanis outstanding voting stock; and
4.
Such other business that may properly come before the meeting.
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Corporate Secretary
, 2010
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1
6
22
36
64
65
69
71
73
74
75
77
78
80
86
108
134
146
148
173
174
175
182
187
188
188
189
189
189
F-1
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FOR STOCKHOLDERS OF ORITANI FINANCIAL CORP.
REGARDING THE PLAN OF CONVERSION AND REORGANIZATION
Q.
WHAT ARE STOCKHOLDERS BEING ASKED TO APPROVE?
A.
Oritani Financial Corp. stockholders as of [stockholder record date] are being asked to vote
on the plan of conversion pursuant to which Oritani Financial Corp., MHC will convert from the
mutual to the stock form of organization. As part of the conversion, a newly formed Delaware
corporation, Oritani is offering its common stock to eligible depositors of Oritani Bank, to
stockholders of Oritani Financial Corp. as of [stockholder record date] and to the public. The
shares offered represent Oritani Financial Corp., MHCs current 74.4% ownership interest in
Oritani Financial Corp. Voting for approval of the plan of conversion will also include
approval of the exchange ratio and the certificate of incorporation and bylaws of Oritani
(including the anti-takeover provisions and provisions limiting stockholder rights).
Your
vote is important. Without sufficient votes FOR its adoption, we cannot implement the plan
of conversion.
In addition, Oritani Financial Corp. stockholders are being asked to approve the adjournment
of the special meeting, if necessary, to solicit additional proxies in the event that there
are not sufficient votes at the time of the special meeting to approve the plan of
conversion.
Stockholders also are asked to vote on the following informational proposals with respect to
the certificate of incorporation and bylaws of Oritani:
Approval of a provision in Oritanis certificate of incorporation to limit
the ability of stockholders to remove directors;
Approval of a provision in Oritanis certificate of incorporation requiring
a super-majority vote to approve certain amendments to Oritanis certificate of
incorporation;
Approval of a provision in Oritanis bylaws requiring a super-majority vote
of stockholders to approve stockholder-proposed amendments to Oritanis bylaws;
and
Approval of a provision in Oritanis certificate of incorporation to limit
the voting rights of shares beneficially owned in excess of 10% of Oritanis
outstanding voting stock.
The provisions of Oritanis certificate of incorporation and bylaws that are included as
informational proposals were approved as part of the process in which our Board of Directors
approved the plan of conversion. These proposals are informational in nature only, because
the Office of Thrift Supervisions regulations governing mutual-to-stock conversions do not
provide for votes on matters other than the plan of conversion. While we are asking you to
vote with respect to each of the informational proposals listed above, the proposed
provisions for which an
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informational vote is requested will become effective if stockholders approve the plan of
conversion, regardless of whether stockholders vote to approve any or all of the
informational proposals. The provisions of Oritanis certificate of incorporation and
bylaws which are summarized above as informational proposals may have the effect of
deterring, or rendering more difficult, attempts by third parties to obtain control of
Oritani if such attempts are not approved by the Board of Directors, or may make the removal
of the Board of Directors or management, or the appointment of new directors, more
difficult.
Your vote is important. Without sufficient votes FOR adoption of the plan of conversion,
we cannot implement the plan of conversion and the related stock offering.
Q.
WHAT ARE THE REASONS FOR THE CONVERSION AND RELATED OFFERING?
A.
Our primary reasons for converting and raising additional capital through the offering are:
to support internal growth through lending and deposit gathering in the
communities we serve;
to enhance existing products and services, and support the development of
new products and services to support growth and enhanced customer service;
to improve the liquidity of our shares of common stock and stockholder
returns through higher earnings and more flexible capital management strategies;
to finance the acquisition of branches from other financial institutions
or build or lease new branch facilities primarily in, or adjacent to New Jersey,
although we do not currently have any agreements or understandings regarding any
specific acquisition transaction;
to finance the acquisition of financial institutions or other financial
service companies primarily in, or adjacent to New Jersey, although we do not currently
have any understandings or agreements regarding any specific acquisition transaction;
to maintain our capital position during a period of significant economic
uncertainty, especially for the financial services industry (although, as of December
31, 2009, Oritani Bank was considered well capitalized for regulatory purposes and is
not subject to any directive or recommendation from the Federal Deposit Insurance
Corporation (the FDIC) or the New Jersey Department of Banking and Insurance to raise
capital); and
to use the additional capital for other general corporate purposes.
As a fully converted stock holding company, we will have greater flexibility in structuring
mergers and acquisitions, including the form of consideration that we can use to pay for an
acquisition. Our current mutual holding company structure limits our ability to offer
shares of our common stock as consideration for a merger or acquisition since Oritani
Financial Corp., MHC is required to own a majority of our shares of common stock. Potential
sellers often want stock for at least part of the purchase price. Our new stock holding
company structure will enable us to offer stock or cash consideration, or a combination of
stock and cash, and will therefore enhance our ability to compete with other bidders when
acquisition opportunities arise.
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Q.
WHAT WILL STOCKHOLDERS RECEIVE FOR THEIR EXISTING ORITANI FINANCIAL CORP. SHARES?
A.
As more fully described in Proposal 1 Approval of the Plan of Conversion and
Reorganization Share Exchange Ratio, depending on the number of shares sold in the
offering, each share of common stock that you own at the time of the completion of the
conversion will be exchanged for between 1.2022 shares at the minimum and 1.6264 shares at the
maximum of the offering range (or 1.8704 at the adjusted maximum of the offering range) of
Oritani common stock (cash will be paid in lieu of any fractional shares). For example, if
you own 100 shares of Oritani Financial Corp. common stock, and the exchange ratio is 1.4143
(at the midpoint of the offering range), after the conversion you will receive 141 shares of
Oritani Financial Corp. common stock and $4.30 in cash, the value of the fractional share,
based on the $10.00 per share purchase price of stock in the offering.
After completion of the conversion, stockholders who hold shares in street-name at a
brokerage firm or other nominee do not need to take any action to exchange their shares
of common stock. Your shares will be automatically exchanged within your account.
Stockholders with Oritani Financial Corp. stock certificates will receive a transmittal
form from our exchange agent with instructions on how to surrender stock certificates
to receive new stock certificates representing shares of Oritani You should not submit
a stock certificate until you receive a transmittal form.
Q.
WHY WILL THE SHARES THAT I RECEIVE BE BASED ON A PRICE OF $10.00 PER SHARE RATHER THAN THE
TRADING PRICE OF THE COMMON STOCK PRIOR TO COMPLETION OF THE CONVERSION?
A.
The $10.00 per share price was selected primarily because it is a commonly selected per share
price for mutual-to-stock conversion offerings. The amount of common stock Oritani will issue
at $10.00 per share in the offering and the exchange is based on an independent appraisal of
the estimated market value of Oritani, assuming the conversion and offering are completed. RP
Financial, LC., an appraisal firm experienced in appraisal of financial institutions, has
estimated that, as of February 19, 2010, this market value ranged from $445.3 million to
$602.5 million, with a midpoint of $523.8 million. Based on this valuation, the number of
shares of common stock of Oritani that existing public stockholders of Oritani Financial Corp.
will receive in exchange for their shares of Oritani Financial Corp. common stock will range
from approximately 33.15 million to 44.85 million, with a midpoint of 39.0 million (with a
value of approximately $331.5 million to $448.5 million, with a midpoint of $390.0 million, at
$10.00 per share). The number of shares received by the existing public stockholders of
Oritani Financial Corp. is intended to maintain their existing 25.6% ownership in our
organization (excluding any new shares purchased by them in the offering and their receipt of
cash in lieu of fractional exchange shares). The independent appraisal is based in part on
Oritani Financial Corp.s financial condition and results of operations, the pro forma impact
of the additional capital raised by the sale of shares of common stock in the offering, and an
analysis of a peer group of ten publicly traded savings bank and thrift holding companies that
RP Financial, LC. considered comparable to Oritani Financial Corp.
Q.
DOES THE EXCHANGE RATIO DEPEND ON THE TRADING PRICE OF ORITANI FINANCIAL CORP. COMMON STOCK?
A.
No, the exchange ratio will not be based on the market price of Oritani Financial Corp.
common stock. Therefore, changes in the price of Oritani Financial Corp. common stock between
now and the completion of the conversion and offering will not affect the calculation of the
exchange ratio.
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Q.
WHY DOESNT ORITANI FINANCIAL CORP. WAIT TO CONDUCT THE CONVERSION AND OFFERING UNTIL THE
STOCK MARKET IMPROVES SO THAT CURRENT STOCKHOLDERS CAN RECEIVE A HIGHER EXCHANGE RATIO?
A.
The Board of Directors believes that because the stock holding company form of organization
offers important advantages and that it is in the best interest of our stockholders to
complete the conversion and offering sooner rather than later. There is no way to know when
market conditions will change, when regulations governing conversion to stock form will
change, or how they might change, or how changes in market conditions might affect stock
prices for financial institutions. The Board of Directors concluded that it would be better to
complete the conversion and offering now, under existing Office of Thrift Supervision
conversion regulations and under a valuation that offers a fair exchange ratio to existing
stockholders and an attractive price to new investors, rather than wait an indefinite amount
of time for market conditions that would result in a higher exchange ratio but a less
attractive valuation for new investors.
Q.
SHOULD I SUBMIT MY STOCK CERTIFICATES NOW?
A.
No. If you hold stock certificate(s), instructions for exchanging the certificates will be
sent to you by our exchange agent
after
completion of the conversion. If your shares are held
in street name (
e.g.,
in a brokerage account) rather than in certificate form, the share
exchange will be reflected automatically in your account upon completion of the conversion.
Q.
HOW DO I VOTE?
A.
Mark your vote, sign each proxy card enclosed and return the card(s) to us, in the enclosed
proxy reply envelope. If you prefer, you may vote by using the telephone or Internet. For
information on submitting your proxy or voting by telephone or Internet, please refer to
instructions on the enclosed proxy card.
YOUR VOTE IS IMPORTANT. PLEASE VOTE PROMPTLY.
Q.
IF MY SHARES ARE HELD IN STREET NAME, WILL MY BROKER, BANK OR OTHER NOMINEE AUTOMATICALLY
VOTE ON THE PLAN ON MY BEHALF?
A.
No. Your broker, bank or other nominee will not be able to vote your shares without
instructions from you. You should instruct your broker, bank or other nominee to vote your
shares, using the directions that they provide to you.
Q.
WHAT HAPPENS IF I DONT VOTE?
A.
Your vote is very important. Not voting all the proxy card(s) you receive will have the same
effect as voting
against
the plan of conversion.
Without sufficient favorable votes
for
the plan of conversion, we will not proceed with the conversion and offering.
Q.
WHAT IF I DO NOT GIVE VOTING INSTRUCTIONS TO MY BROKER, BANK OR OTHER NOMINEE?
A.
Your vote is important. If you do not instruct your broker, bank or other nominee to vote
your shares, the unvoted proxy will have the same effect as a vote
against
the plan of
conversion.
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Q.
MAY I PLACE AN ORDER TO PURCHASE SHARES IN THE OFFERING, IN ADDITION TO THE SHARES THAT I
WILL RECEIVE IN THE EXCHANGE?
A.
Yes. If you would like to receive a prospectus and stock order form, you must call our Stock
Information Center at 1-877-___, Monday through Friday between 10:00 a.m. and 4:00 p.m.,
Eastern Time. The Stock Information Center is closed weekends and bank holidays.
Eligible depositors of Oritani Bank have priority subscription rights allowing them to
purchase common stock in a subscription offering. Shares of common stock not purchased in
the subscription offering are expected to be offered for sale in a community offering,
which will be limited to persons residing in New Jersey counties of Bergen, Passaic, Sussex,
Hudson, Essex, Morris, Warren, Union, Somerset, Hunterdon, Middlesex and Mercer, certain
borrowers as of December 31, 2009 and the stockholders of Oritani Financial Corp as of
[voting record date]. We also may offer for sale shares of common stock not purchased in
the subscription offering or community offering through a syndicated community offering
managed by Stifel, Nicolaus & Company, Incorporated.
Shares of common stock purchased in the offering by a stockholder and his or her
associates or individuals acting in concert with the stockholder,
plus
any shares a
stockholder and these individuals receive in the exchange for existing shares of Oritani
Financial Corp. common stock, may not exceed 5% of the total shares of common stock of
Oritani to be issued and outstanding after the completion of the conversion.
Q.
WILL THE CONVERSION HAVE ANY EFFECT ON DEPOSIT AND LOAN ACCOUNTS AT ORITANI BANK?
A.
No. The account number, amount, interest rate and withdrawal rights of deposit accounts will
remain unchanged. Deposits will continue to be federally insured by the Federal Deposit
Insurance Corporation up to the legal limit. Loans and rights of borrowers will not be
affected. Depositors will no longer have voting rights in the mutual holding company, which
will cease to exist, after the conversion and offering. Only stockholders of Oritani will
have voting rights after the conversion and offering.
Table of Contents
1.
The approval of a plan of conversion and reorganization pursuant to which: (a)
Oritani Financial Corp., MHC, a federal corporation will merge with and into Oritani
Financial Corp., with Oritani Financial Corp. being the surviving entity; (b) Oritani
Financial Corp., will merge with and into Oritani with, with Oritani being the
surviving entity; (c) the outstanding shares of Oritani Financial Corp., other than
those held by Oritani Financial Corp., MHC, will be converted into shares of common
stock of Oritani; and (e) Oritani will offer shares of its common stock for sale in a
subscription offering, and, if necessary, a community offering or syndicated community
offering;
2.
The approval of the adjournment of the special meeting, if necessary, to
solicit additional proxies in the event that there are not sufficient votes at the time
of the special meeting to approve the plan of conversion and reorganization;
3.
The following informational proposals:
3a.
Approval of a provision in Oritanis certificate of incorporation
to limit the ability of stockholders to remove directors;
3b.
Approval of a provision in Oritanis certificate of incorporation
requiring a super-majority vote to approve certain amendments to Oritanis
certificate of incorporation;
3c.
Approval of a provision in Oritanis bylaws requiring a
super-majority vote of stockholders to approve stockholder-proposed amendments to
Oritanis bylaws;
3d.
Approval of a provision in Oritanis certificate of incorporation
to limit the voting rights of shares beneficially owned in excess of 10% of
Oritanis outstanding voting stock; and
4.
Such other business that may properly come before the meeting.
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to support internal growth through lending and deposit gathering in the
communities we serve;
to enhance existing products and services, and support the development of
new products and services to support growth and enhanced customer service;
Table of Contents
to improve the liquidity of our shares of common stock and stockholder
returns through higher earnings and more flexible capital management strategies;
to finance the acquisition of branches from other financial institutions
or build or lease new branch facilities primarily in, or adjacent to New Jersey,
although we do not currently have any agreements or understandings regarding any
specific acquisition transaction;
to finance the acquisition of financial institutions or other financial
service companies primarily in, or adjacent to New Jersey, although we do not currently
have any understandings or agreements regarding any specific acquisition transaction;
to maintain our capital position during a period of significant economic
uncertainty, especially for the financial services industry (although, as of December
31, 2009, Oritani Bank was considered well capitalized for regulatory purposes and is
not subject to any directive or recommendation from the Federal Deposit Insurance
Corporation (the FDIC) or the New Jersey Department of Banking and Insurance to raise
capital); and
to use the additional capital for other general corporate purposes.
The plan of conversion and reorganization is approved by at least
a
majority of votes eligible
to be cast by members of Oritani Financial Corp., MHC
(depositors of Oritani Bank) as of [depositor record date];
The plan of conversion and reorganization is approved by a vote of at
least
two-thirds of the outstanding shares
of common stock of Oritani Financial Corp.
as of [stockholder record date], including shares held by Oritani Financial Corp., MHC
(because Oritani Financial Corp., MHC owns 74.4% of the outstanding shares of Oritani
Financial Corp. common stock, we expect that Oritani Financial Corp., MHC and our
directors and executive officers will control the outcome of this vote);
The plan of conversion and reorganization is approved by a vote of at
least
a majority of the outstanding shares
of common stock of Oritani Financial Corp.
as of [stockholder record date], excluding those shares held by Oritani Financial
Corp., MHC;
We sell at least the minimum number of shares of common stock offered; and
We receive the final approval of the OTS to complete the conversion;
however, such approval does not constitute a recommendation or endorsement of the plan
of conversion and reorganization by that agency.
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New Shares to be
Exchanged for Existing
Total Shares of
New Shares That
New Shares to be Sold
Shares of Oritani
Common Stock to be
Equivalent Per
Would be Received
in This Offering
Financial Corp.
Outstanding After
Share Current
for 100 Existing
Amount
Percent
Amount
Percent
the Offering
Exchange Ratio
Market Value (1)
Shares
33,150,000
74.45
%
11,379,252
25.55
%
44,529,252
1.2022
$
12.02
120
39,000,000
74.45
%
13,387,355
25.55
%
52,387,355
1.4143
$
14.14
141
44,850,000
74.45
%
15,395,458
25.55
%
60,245,458
1.6264
$
16.26
162
51,577,500
74.45
%
17,704,777
25.55
%
69,282,277
1.8704
$
18.70
187
(1)
Represents the value of shares of Oritani common stock received in the conversion by a
holder of one share of Oritani Financial Corp. at the exchange ratio, assuming the market
price of $10.00 per share.
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Company Name and Ticker Symbol
Exchange
Headquarters
Total Assets
NASDAQ
East Syracuse, NY
$
1,070
(1)
NASDAQ
Brookline, MA
$
2,616
NASDAQ
Danvers, MA
$
2,500
NASDAQ
Ellwood City, PA
$
1,979
(1)
NASDAQ
Stroudsburg, PA
$
1,034
NASDAQ
Toms River, NJ
$
1,989
NASDAQ
Monroeville, PA
$
1,916
NASDAQ
Montebello, NY
$
2,918
NASDAQ
West Springfield, MA
$
1,247
(1)
AMEX
Westfield, MA
$
1,191
(1)
As of September 30, 2009.
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Price-to-earnings
Price-to-book
Price-to-tangible
multiple
(1)
value ratio
book value ratio
39.21x
82.44
%
82.44
%
45.45x
88.50
%
88.50
%
51.50x
93.63
%
93.63
%
58.25x
98.52
%
98.52
%
18.19x
87.90
%
100.03
%
14.00x
95.34
%
103.58
%
(1)
Information is derived from the RP Financial appraisal report and are based upon
estimated earnings for the twelve months ended December 31, 2009. These ratios are
different from the ratios in Pro Forma Data.
$215.7 million (50.0% of the net proceeds) will be invested in Oritani Bank;
$17.9 million (4.2% of the net proceeds) will be loaned by Oritani to the employee
stock ownership plan to fund its purchase of our shares of common stock; and
$197.8 million (45.8% of the net proceeds) will be retained by Oritani.
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Number of Shares to be Granted or Purchased (1)
Dilution Resulting
Value of Grants (2)
As a Percentage of
From Issuance of
(Dollars in thousands)
At Maximum as
Common Stock to be
Shares for
At Maximum as
At Minimum of
adjusted of
Sold in the
Stock-Based
At Minimum of
adjusted of
Offering Range
Offering Range
Offering
Incentive Plans (3)
Offering Range
Offering Range
1,326,000
2,063,100
4.0
%
%
$
13,260
$
20,631
1,326,000
2,063,100
(1)
4.0
2.89
13,260
20,631
3,315,000
5,157,750
(2)
10.0
6.93
11,370
17,691
5,967,000
9,283,950
18.0
%
9.44
%
$
37,890
$
58,953
(1)
The table assumes that the stock-based incentive plan is implemented twelve months or more
following the completion of the conversion and offering. If implemented within 12 months of
the completion of the conversion, the number of shares that may be reserved for grants of
restricted stock cannot exceed 4% of the total number of shares to be outstanding upon
completion of the conversion, less the number of shares of restricted stock (adjusted for the
exchange ratio) reserved under previously adopted benefit plans.
(2)
The table assumes that the stock-based incentive plan is implemented twelve months or more
following the completion of the conversion and offering. If implemented within 12 months of
the completion of the conversion, the number of shares that may be reserved for grants of
stock options cannot exceed 10% of the total number of shares to be outstanding upon
completion of the conversion, less the number of option shares (adjusted for the exchange
ratio) reserved under previously adopted benefit plans.
(3)
The actual value of restricted stock awards will be determined based on their fair value as
of the date grants are made. For purposes of this table, fair value for stock awards is
assumed to be the same as the offering price of $10.00 per share. The fair value of stock
options has been estimated at $3.43 per option using the Black-Scholes option pricing model
with the following assumptions: a grant-date share price and option exercise price of $10.00;
an expected option life of ten years; a dividend yield of 3.0%; an interest rate of 3.85%; and
a volatility rate of 36.45% based on an index of publicly traded thrift institutions. The
actual value of option grants will be determined by the grant-date fair value of the options,
which will depend on a number of factors, including the valuation assumptions used in the
option pricing model ultimately adopted.
(4)
Represents the dilution of stock ownership interest. No dilution is reflected for the
employee stock ownership plan because such shares are assumed to be purchased in the offering.
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Percentage of
Shares Outstanding
Existing and New Stock-Based
Estimated Value of
After the
Incentive Plans
Participants
Shares
Shares
Conversion
(Dollars in thousands)
Employees
2,585,397
(1)
$
25,854
4.29
%
Employees
1,794,000
17,940
2.98
%
Employees
4,379,397
43,794
7.27
%
Directors, Officers and
Employees
1,292,700
(2)
12,927
(3)
2.15
%
Directors, Officers and
Employees
1,794,000
17,940
2.98
%
Directors, Officers and
Employees
3,086,700
30,867
5.13
%
Directors, Officers and
Employees
3,231,746
(4)
11,117
5.36
%
Directors, Officers and
Employees
4,485,000
15,384
(5)
7.44
%
Directors, Officers and
Employees
7,716,746
26,501
12.80
%
15,182,843
$
101,162
25.20
%
(1)
As of December 31, 2009, Oritani Financial Corp.s existing employee stock ownership plan
held 1,588,649 shares, 237,451 of which have been allocated.
(2)
Represents shares of restricted stock authorized for grant under our existing recognition and
retention plans.
(3)
The actual value of restricted stock awards will be determined based on their fair value as
of the date grants are made. For purposes of this table, fair value is assumed to be the same
as the offering price of $10.00 per share.
(4)
Represents shares authorized for grant under our existing stock option plans.
(5)
The fair value of stock options to be granted under the new stock-based incentive plan has
been estimated based on an index of publicly traded thrift institutions at $3.43 per option
using the Black-Scholes option pricing model with the following assumptions; exercise price,
$10.00; trading price on date of grant, $10.00; dividend yield, 3.0%; expected life, ten
years; expected volatility, 36.45%; and interest rate, 3.85%.
(6)
The number of shares of restricted stock and stock options set forth in the table would
exceed regulatory limits if a stock-based incentive plan was adopted within one year of the
completion of the conversion and offering. Accordingly, the number of new shares of
restricted stock and stock options set forth in the table would have to be reduced such that
the aggregate amount of outstanding stock awards would be 4.0% or less and outstanding stock
options would be 10.0% or less, unless we obtain a waiver from the OTS, or we implement the
incentive plan after twelve months following the completion of the conversion and offering.
Our current intention is to implement a new stock-based incentive plan no earlier than twelve
months after completion of the conversion and offering.
2,063,100 Shares
1,362,000 Shares
1,560,000 Shares
1,794,000 Shares
Awarded at Maximum
Awarded at Minimum
Awarded at Midpoint
Awarded at Maximum
of Range, As
Share Price
of Range
of Range
of Range
Adjusted
(Dollars in thousands, except per share data))
$
10,608
$
12,480
$
14,352
$
16,505
13,260
15,600
17,940
20,631
15,912
18,720
21,528
24,757
18,564
21,840
25,116
28,883
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3,900,000 Options
5,157,750 Options
Grant-Date Fair
3,315,000 Options
at Midpoint of
4,485,000 Options
at Maximum of
Exercise Price
Value Per Option
at Minimum of Range
Range
at Maximum of Range
Range, As Adjusted
(Dollars in thousands, except per share data)
$
2.74
$
9,083
$
10,686
$
12,289
$
14,132
3.43
11,370
13,377
15,384
17,691
4.12
13,658
16,068
18,478
21,250
4.80
15,912
18,720
21,528
24,757
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the interest income we earn on our interest-earning assets, such as loans and
securities; and
the interest expense we pay on our interest-bearing liabilities, such as
deposits and borrowings.
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Office of Thrift Supervision Regulations
.
OTS regulations prohibit, for
three years following the completion of a conversion, the direct or indirect
acquisition of more than 10.0% of any class of equity security of a savings institution
or holding company regulated by the OTS regulated holding company of a converted
institution without the prior approval of the OTS.
Certificate of incorporation and statutory provisions.
Provisions of the
certificate of incorporation and bylaws of Oritani and Delaware law may make it more
difficult and expensive to pursue a takeover attempt that management opposes, even if
the takeover is favored by a majority of our stockholders. These provisions also would
make it more difficult to remove our current Board of Directors or management, or to
elect new directors. Additional provisions include limitations on voting rights of
beneficial owners of more than 10.0% of our common stock, the election of directors to
staggered terms of three years and not permitting cumulative voting in the election of
directors. Our bylaws also contain provisions regarding the timing and content of
stockholder proposals and nominations and qualification for service on the Board of
Directors.
Issuance of stock options and restricted stock
.
We also intend to issue
stock options and shares of restricted stock to key employees and directors that will
require payments to these persons in the event of a change in control of Oritani.
These payments may have the effect of increasing the costs of acquiring Oritani,
thereby discouraging future takeover attempts.
Employment agreements
.
Oritani Financial Corp. has employment agreements
with each of its executive officers which will remain in effect following the stock
offering. These agreements may have the effect of increasing the costs of acquiring
Oritani, thereby discouraging future takeover attempts.
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(i)
First, to depositors with accounts at Oritani Bank with aggregate balances of
at least $50.00 at the close of business on December 31, 2008.
(ii)
Second, to our tax-qualified employee benefit plans, including our employee
stock ownership plan and 401(k) plan, which will receive nontransferable subscription
rights to purchase in the aggregate up to 10.0% of the shares of common stock sold in
the offering.
(iii)
Third, to depositors with accounts at Oritani Bank with aggregate balances of
at least $50.00 at the close of business on [supplemental record date].
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(iv)
Fourth, to depositors of Oritani Bank at the close of business on [depositor
record date].
(v)
Persons residing in the New Jersey counties of Bergen, Passaic, Sussex, Hudson,
Essex, Morris, Warren, Union, Somerset, Hunterdon, Middlesex and Mercer;
(vi)
Oritani Banks borrowers (with an outstanding loan or line of credit) as of
December 31, 2009 that are meeting all of the terms and conditions of their loan
agreements with Oritani Bank as of December 31, 2009 and the date of purchase of the
common stock (as determined solely in the discretion of Oritani Bank); and
(vii)
Oritani Financial Corp.s public stockholders as of [stockholder record date].
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to support internal growth through lending and deposit gathering in the
communities we serve;
to enhance existing products and services, and support the development of
new products and services to support growth and enhanced customer service;
to improve the liquidity of our shares of common stock and stockholder
returns through higher earnings and more flexible capital management strategies;
to finance the acquisition of branches from other financial institutions
or build or lease new branch facilities primarily in, or adjacent to New Jersey,
although we do not currently have any agreements or understandings regarding any
specific acquisition transaction;
to finance the acquisition of financial institutions or other financial
service companies primarily in, or adjacent to New Jersey, although we do not currently
have any understandings or agreements regarding any specific acquisition transaction;
to maintain our capital position during a period of significant economic
uncertainty, especially for the financial services industry (although, as of December
31, 2009, Oritani Bank was considered well capitalized for regulatory purposes and is
not subject to any directive or recommendation from the FDIC or the New Jersey
Department of Banking and Insurance to raise capital); and
to use the additional capital for other general corporate purposes.
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The plan of conversion and reorganization is approved by at least
a
majority of votes eligible
to be cast by members of Oritani Financial Corp., MHC
(depositors of Oritani Bank) as of [depositor record date];
The plan of conversion and reorganization is approved by a vote of at
least
two-thirds of the outstanding shares
of common stock of Oritani Financial Corp.
as of [stockholder record date], including shares held by Oritani Financial Corp., MHC.
(Because Oritani Financial Corp., MHC owns 74.4% of the outstanding shares of Oritani
Financial Corp. common stock, we expect that Oritani Financial Corp., MHC and our
directors and executive officers will control the outcome of this vote.);
The plan of conversion and reorganization is approved by a vote of at
least
a majority of the outstanding shares
of common stock of Oritani Financial Corp.
as of [stockholder record date], excluding those shares held by Oritani Financial
Corp., MHC;
We sell at least the minimum number of shares of common stock offered; and
We receive the final approval of the Office of Thrift Supervision to
complete the conversion; (including the merger of Oritani Financial Corp., MHC into
Oritani Financial Corp. and the merger of Oritani Financial Corp. into Oritani)
however, such approval does not constitute a recommendation or endorsement of the plan
of conversion and reorganization by that agency.
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New Shares to be
Total Shares of
Per
New Shares That
Exchanged for Existing
Common Stock to be
Equivalent
Would be Received
New Shares to be Sold
Shares of Oritani
Outstanding After
Share Current
for 100 Existing
in This Offering
Financial Corp.
the Offering
Exchange Ratio
Market Value (1)
Shares
Amount
Percent
Amount
Percent
33,150,000
74.4454
%
11,379,252
25.5546
%
44,529,252
1.20220
$
12.02
120
39,000,000
74.4454
%
13,387,355
25.5546
%
52,387,355
1.41430
$
14.14
141
44,850,000
74.4454
%
15,395,458
25.5546
%
60,245,458
1.62640
$
16.26
163
51,577,500
74.4454
%
17,704,777
25.5546
%
69,282,277
1.87040
$
18.70
187
(1)
Represents the value of shares of Oritani received in the conversion by a holder of one share
of Oritani Financial Corp. at the exchange ratio, assuming the market price of $10.00 per
share.
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the present results and financial condition of Oritani Financial Corp. and
the projected results and financial condition of Oritani;
the economic and demographic conditions in Oritani Financial Corp.s
existing market area;
certain historical, financial and other information relating to Oritani
Financial Corp.;
the impact of the offering on Oritanis stockholders equity and earnings
potential;
the proposed dividend policy of Oritani; and
the trading market for securities of comparable institutions and general
conditions in the market for such securities.
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Oritani Financial Corp.s financial condition and results of operations;
comparison of financial performance ratios of Oritani Financial Corp. to
those of other financial institutions of similar size;
market conditions generally and in particular for financial institutions;
and
the historical trading price of the publicly held shares of Oritani
Financial Corp. common stock.
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(viii)
Persons residing in the counties of Bergen, Passaic, Sussex, Hudson, Essex, Morris,
Warren, Union, Somerset, Hunterdon, Middlesex and Mercer;
(ix)
Oritani Banks borrowers (with an outstanding loan or line of credit) as of
December 31, 2009 that are meeting all of the terms and conditions of their loan
agreements with Oritani Bank as of December 31, 2009 and the date of purchase of the
common stock (as determined solely in the discretion of Oritani Bank);
(x)
Oritani Financial Corp.s public stockholder as of [stockholder record date];
and
(xi)
members of the general public.
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(i)
No person may purchase fewer than 25 shares of common stock;
(ii)
The maximum number of shares of common stock that may be purchased by a person,
or persons exercising subscription rights through a single qualifying deposit account
held jointly, is 50,000 shares;
(iii)
Our tax-qualified employee stock benefit plans, including our employee stock
ownership plan and 401(k) plan, may purchase in the aggregate up to 10.0% of the shares
of common stock sold in the offering, including shares sold in the event of an increase
in the offering range of up to 15%;
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(iv)
Except for the tax-qualified employee stock benefit plans, including our
employee stock ownership plan and 401(k) plan, as described above, no person or entity,
together with associates or persons acting in concert with such person or entity, may
purchase more than $1.0 million (100,000 shares) of common stock in all categories of
the offering combined;
(v)
Current stockholders of Oritani Financial Corp. are subject to an ownership
limitation. As previously described, current stockholders of Oritani Financial Corp.
will receive shares of Oritani common stock in exchange for their existing shares of
Oritani Financial Corp. common stock at the conclusion of the offering. The number of
shares of common stock that a stockholder may purchase in the offering, together with
associates or persons acting in concert with such stockholder, when combined with the
shares that the stockholder and his or her associates will receive in exchange for
existing Oritani Financial Corp. common stock, may not exceed 5% of the shares of
common stock of Oritani to be issued and outstanding at the completion of the
conversion; and
(vi)
The maximum number of shares of common stock that may be purchased in all
categories of the offering by executive officers and directors of Oritani Bank and
their associates, in the aggregate, when combined with shares of common stock issued in
exchange for existing shares, may not exceed 25% of the shares of Oritani common stock
outstanding upon completion of the conversion.
(i)
to fill subscriptions by the tax-qualified employee stock benefit plans,
including the employee stock ownership plan, for up to 10.0% of the total number of
shares of common stock sold in the offering;
(ii)
in the event that there is an oversubscription at the Eligible Account Holder,
Supplemental Eligible Account Holder or Other Depositor levels, to fill unfulfilled
subscriptions of these subscribers according to their respective priorities; and
(iii)
to fill subscriptions in the community offering, with preference given first
to persons residing in the New Jersey counties of Bergen, Passaic, Sussex, Hudson,
Essex, Morris, Warren, Union, Somerset, Hunterdon, Middlesex and Mercer; then to
Oritani Banks borrowers (with an outstanding loan or line of credit) as of December
31, 2009 that are meeting all of their terms and conditions of the loan agreements with
Oritani Bank (as
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determined solely in the discretion of Oritani Bank) as of December 31, 2009 and the
date of purchase of the common stock; then to Oritani Financial Corp.s public
stockholders as of [stockholder record date] and then to members of the general
public.
(i)
any corporation or organization, other than Oritani Financial Corp., MHC,
Oritani Financial Corp., Oritani Bank or a majority-owned subsidiary of Oritani
Financial Corp. or Oritani Bank, of which the person is a senior officer, partner or
beneficial owner, directly or indirectly, of 10.0% or more of any equity security;
(ii)
any trust or other estate in which the person has a substantial beneficial
interest or serves as a trustee or in a similar fiduciary capacity; provided, however,
that for the purposes of subscriptions in the offering and restrictions on the sale of
stock after the conversion, the term associate does not include a person who has a
substantial beneficial interest in an employee stock benefit plan of Oritani Bank, or
who is a trustee or fiduciary of such plan, and for purposes of aggregating total
shares that may be held by officers, trustees and directors of Oritani Financial Corp.,
MHC, Oritani Financial Corp. or Oritani Bank, (the term associate does not include
any tax-qualified employee stock benefit plan of Oritani Bank); and
(iii)
any blood or marriage relative of the person, who either has the same home as
the person or who is a director, trustee or officer of Oritani Financial Corp., MHC,
Oritani Financial Corp. or Oritani Bank.
(i)
knowing participation in a joint activity or interdependent conscious parallel
action towards a common goal whether or not pursuant to an express agreement; or
(ii)
a combination or pooling of voting or other interests in the securities of an
issuer for a common purpose pursuant to any contract, understanding, relationship,
agreement or other arrangement, whether written or otherwise.
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(i)
acting as our financial advisor for the conversion and offering;
(ii)
providing administrative services and managing the Stock Information Center;
(iii)
educating our employees regarding the offering;
(iv)
targeting our sales efforts, including assisting in the preparation of
marketing materials; and
(v)
soliciting orders for common stock.
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(vi)
personal check, bank check or money order, made payable to Oritani Bank; or
(vii)
authorization of withdrawal from the types of Oritani Bank deposit accounts
designated on the stock order form.
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1.
The merger of Oritani Financial Corp., MHC with and into Oritani Financial
Corp. will qualify as a tax-free reorganization within the meaning of Section
368(a)(1)(A) of the Internal Revenue Code.
2.
The constructive exchange of Eligible Account Holders and Supplemental
Eligible Account Holders liquidation interests in Oritani Financial Corp., MHC for
liquidation interests in Oritani Financial Corp. will satisfy the continuity of
interest requirement of Section 1.368-1(b) of the Federal Income Tax Regulations.
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3.
None of Oritani Financial Corp., MHC, Oritani Financial Corp., Eligible Account
Holders nor Supplemental Eligible Account Holders, will recognize any gain or loss on
the transfer of the assets of Oritani Financial Corp., MHC to Oritani Financial Corp.
in constructive exchange for a liquidation interest established in Oritani Financial
Corp. for the benefit of such persons who remain depositors of Oritani Bank.
4.
The basis of the assets of Oritani Financial Corp., MHC and the holding period
of such assets to be received by Oritani Financial Corp. will be the same as the basis
and holding period in such assets in the hands of Oritani Financial Corp., MHC
immediately before the exchange. (Sections 362(b) and 1223(2) of the Internal Revenue
Code.)
5.
The merger of Oritani Financial Corp. with and into Oritani will constitute a
mere change in identity, form or place of organization within the meaning of Section
368(a)(1)(F) of the Code and therefore will qualify as a tax-free reorganization within
the meaning of Section 368(a)(1)(F) of the Code. Neither Oritani Financial Corp. nor
Oritani will recognize gain or loss as a result of such merger. (Sections 361(a) and
1032(a) of the Internal Revenue Code).
6.
The basis of the assets of Oritani Financial Corp. and the holding period of
such assets to be received by Oritani will be the same as the basis and holding period
in such assets in the hands of Oritani Financial Corp. immediately before the exchange.
(Sections 362(b) and 1223(2) of the Internal Revenue Code.)
7.
Current stockholders of Oritani Financial Corp. will not recognize any gain or
loss upon their constructive exchange of Oritani Financial Corp. common stock for
Oritani common stock.
8.
Eligible Account Holders and Supplemental Eligible Account Holders will not
recognize any gain or loss upon their constructive exchange of their liquidation
interests in Oritani Financial Corp. for the liquidation accounts in Oritani.
9.
The constructive exchange of the Eligible Account Holders and Supplemental
Eligible Account Holders liquidation interests in Oritani Financial Corp. for interests
in a liquidation account established in Oritani will satisfy the continuity of interest
requirement of Section 1.368-1(b) of the Federal Income Tax Regulations
10.
Each stockholders aggregate basis in shares of Oritani common stock (including
fractional share interests) received in the exchange will be the same as the aggregate
basis of Oritani Financial Corp. common stock surrendered in the exchange.
11.
Each stockholders holding period in his or her Oritani common stock received
in the exchange will include the period during which the Oritani Financial Corp. common
stock surrendered was held, provided that the Oritani Financial Corp. common stock
surrendered is a capital asset in the hands of the stockholder on the date of the
exchange.
12.
Cash received by any current stockholder of Oritani Financial Corp. in lieu of
a fractional share interest in shares of Oritani common stock will be treated as having
been received as a distribution in full payment in exchange for a fractional share
interest of Oritani common stock, which such stockholder would otherwise be entitled to
receive. Accordingly, a stockholder will recognize gain or loss equal to the difference
between the cash received and
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the basis of the fractional share. If the common stock is held by the stockholder as a
capital asset, the gain or loss will be capital gain or loss.
13.
It is more likely than not that the fair market value of the nontransferable
subscription rights to purchase Oritani common stock is zero. Accordingly, no gain or
loss will be recognized by Eligible Account Holders, Supplemental Eligible Account
Holders or Other Members upon distribution to them of nontransferable subscription
rights to purchase shares of Oritani common stock. Eligible Account Holders,
Supplemental Eligible Account Holders and Other Members will not realize any taxable
income as the result of the exercise by them of the nontransferable subscriptions
rights.
14.
It is more likely than not that the fair market value of the benefit provided
by the liquidation account of Oritani Bank supporting the payment of the Oritani
liquidation account in the event Oritani lacks sufficient net assets is zero.
Accordingly, it is more likely than not that no gain or loss will be recognized by
Eligible Account Holders and Supplemental Eligible Account Holders upon the
constructive distribution to them of such rights in the Oritani Bank liquidation
account as of the effective date of the merger of Oritani Financial Corp. with and into
Oritani. (Section 356(a) of the Internal Revenue Code.)
15.
It is more likely than not that the basis of the shares of Oritani common stock
purchased in the offering by the exercise of nontransferable subscription rights will
be the purchase price. The holding period of the Oritani common stock purchased
pursuant to the exercise of nontransferable subscription rights will commence on the
date on which the right to acquire such stock was exercised.
16.
No gain or loss will be recognized by Oritani on the receipt of money in
exchange for Oritani common stock sold in the offering.
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CERTIFICATE OF INCORPORATION AND BYLAWS OF ORITANI
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the purchase of shares by underwriters in connection with a public offering; or
the purchase of shares by any employee benefit plans of Oritani Financial Corp. or
any subsidiary.
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At December
June 30,
31, 2009
2009
2008
2007
2006
2005
(In thousands)
$
2,006,874
$
1,913,521
$
1,443,294
$
1,194,443
$
1,031,421
$
1,051,702
1,357,157
1,278,623
1,007,077
758,542
643,064
493,554
320,439
144,419
22,285
35,443
10,499
60,924
5,415
13,415
25,500
86,182
118,817
163,950
217,406
274,695
372,104
98,513
128,603
149,209
38,793
17,426
25,659
29,973
29,385
26,425
25,365
24,381
18,988
25,481
25,549
21,547
10,619
9,367
9,088
8,786
7,967
5,646
4,973
3,910
3,405
5,836
5,767
5,564
6,200
6,233
5,438
1,222
1,338
3,681
2,492
2,223
1,425
1,210,507
1,127,630
698,932
695,757
688,646
702,980
507,439
508,991
433,672
196,661
169,780
182,129
247,950
240,098
278,975
272,570
150,135
141,796
For the Three Months Ended
For the Six Months Ended
December 31,
December 31,
2009
2008
2009
2008
(Dollars in thousands, except per share amounts)
$
25,467
$
21,862
$
51,246
$
42,519
11,057
11,169
22,617
21,056
14,410
10,693
28,629
21,463
2,500
3,500
5,050
5,375
11,910
7,193
23,579
16,088
1,067
(565
)
3,613
668
8,166
6,542
14,994
12,416
4,811
86
12,198
4,340
1,882
47
4,786
1,795
$
2,929
$
39
$
7,412
$
2,545
$
0.08
$
0.00
$
0.20
$
0.07
$
0.08
$
0.00
$
0.20
$
0.07
Table of Contents
For the Year Ended June 30,
2009
2008
2007
2006
2005
(In thousands)
$
88,429
$
71,591
$
63,349
$
51,276
$
46,439
44,500
37,208
32,829
23,522
18,349
43,929
34,383
30,520
27,754
28,090
9,880
4,650
1,210
1,500
800
34,049
29,733
29,310
26,254
27,290
2,780
4,936
5,309
4,560
1,663
27,257
19,491
25,249
17,524
14,800
9,572
15,178
9,370
13,290
14,153
4,020
6,218
(1,664
)
4,827
5,193
$
5,552
$
8,960
$
11,034
$
8,463
$
8,960
At or for the Six Months
Ended December 31,
(1)
At or For the Years Ended June 30,
2009
2008
2009
2008
2007
2006
2005
0.75
%
0.42
%
0.33
%
0.68
%
0.94
%
0.81
%
0.86
%
6.08
%
4.14
%
2.20
%
3.21
%
5.48
%
5.77
%
6.51
%
2.75
%
2.42
%
2.36
%
2.06
%
2.23
%
2.42
%
2.54
%
3.03
%
2.90
%
2.77
%
2.77
%
2.73
%
2.77
%
2.80
%
46.50
%
56.10
%
58.35
%
49.59
%
70.47
%
54.23
%
49.74
%
1.52
%
1.59
%
1.63
%
1.49
%
2.14
%
1.68
%
1.43
%
111.59
%
117.16
%
114.47
%
123.59
%
117.00
%
115.05
%
114.42
%
2.62
%
2.66
%
2.74
%
0.98
%
%
0.04
%
0.02
%
3.75
%
3.60
%
4.03
%
1.39
%
%
0.07
%
0.04
%
1.60
%
1.54
%
1.59
%
1.32
%
1.15
%
1.18
%
1.23
%
42.70
%
42.91
%
39.42
%
5.23
%
N/M
N/M
N/M
0.50
%
%
0.23
%
%
%
%
%
12.36
%
14.94
%
12.55
%
19.33
%
22.82
%
14.56
%
13.48
%
18.42
%
21.30
%
19.15
%
27.78
%
34.87
%
26.98
%
30.80
%
17.16
%
20.04
%
17.90
%
26.53
%
33.77
%
25.73
%
29.55
%
12.36
%
15.23
%
14.31
%
19.71
%
23.10
%
14.39
%
13.62
%
21
19
21
19
19
19
21
177
158
174
155
144
143
138
(1)
Ratios are annualized where appropriate.
(2)
Represents net income divided by average total assets.
(3)
Represents net income divided by average equity.
(4)
Represents average yield on interest-owning assets less average cost of interest-bearing
liabilities.
(5)
Represents net interest income as a percent of average interest-earning assets.
(6)
Represents non-interest expense divided by the sum of net interest income before provision
for loan losses and non-interest income.
(7)
Represent consolidated ratios.
Table of Contents
statements of our goals, intentions and expectations;
statements regarding our business plans, prospects, growth and operating
strategies;
statements regarding the asset quality of our loan and investment
portfolios; and
estimates of our risks and future costs and benefits.
changes in laws or government regulations or policies affecting financial
institutions, including changes in regulatory fees and capital requirements;
general economic conditions, either nationally or in our market areas,
that are worse than expected;
competition among depository and other financial institutions;
inflation and changes in the interest rate environment that reduce our
margins or reduce the fair value of financial instruments;
adverse changes in the securities markets;
our ability to enter new markets successfully and capitalize on growth
opportunities;
our ability to successfully integrate acquired entities, if any;
changes in consumer spending, borrowing and savings habits;
changes in our organization, compensation and benefit plans;
our ability to continue to increase and manage our commercial and
residential real estate, multi-family, and commercial and industrial loans;
possible impairments of securities held by us, including those issued by
government entities and government sponsored enterprises;
Table of Contents
the level of future deposit premium assessments;
the impact of the current recession on our loan portfolio (including cash
flow and collateral values), investment portfolio, customers and capital market
activities;
the impact of the current governmental effort to restructure the U.S.
financial and regulatory system;
changes in the financial performance and/or condition of our borrowers;
and
the effect of changes in accounting policies and practices, as may be
adopted by the regulatory agencies, as well as the Securities and Exchange Commission,
the Public Company Accounting Oversight Board, the Financial Accounting Standards Board
and other accounting standard setters.
Table of Contents
Based Upon the Sale at $10.00 Per Share of
33,150,000 Shares
39,000,000 Shares
44,850,000 Shares
51,577,500 Shares (1)
Percent
Percent
Percent
Percent of
of Net
of Net
of Net
Net
Amount
Proceeds
Amount
Proceeds
Amount
Proceeds
Amount
Proceeds
(Dollars in thousands)
$
331,500
$
390,000
$
448,500
$
515,775
(13,131
)
(15,096
)
(17,062
)
(19,322
)
$
318,369
100.0
%
$
374,904
100.0
%
$
431,438
100.0
%
$
496,453
100.0
%
$
159,184
50.0
%
$
187,452
50.0
%
$
215,719
50.0
%
$
248,226
50.0
%
$
13,260
4.2
%
$
15,600
4.2
%
$
17,940
4.2
%
$
20,631
4.2
%
$
145,924
45.8
%
$
171,852
45.8
%
$
197,779
45.8
%
$
227,595
45.8
%
(1)
As adjusted to give effect to an increase in the number of shares which could occur due to a
15% increase in the offering range to reflect demand for the shares or changes in market or
general financial conditions following the commencement of the offering.
to support internal growth through lending and deposit gathering in the
communities we serve;
to enhance existing products and services, and support the development of
new products and services to support growth and enhanced customer service;
to improve the liquidity of our shares of common stock and stockholder
returns through higher earnings and more flexible capital management strategies;
to finance the acquisition of branches from other financial institutions
or build or lease new branch facilities primarily in, or adjacent to New Jersey,
although we do not currently have any agreements or understandings regarding any
specific acquisition transaction;
to finance the acquisition of financial institutions or other financial
service companies primarily in, or adjacent to New Jersey, although we do not currently
have any understandings or agreements regarding any specific acquisition transaction;
Table of Contents
to maintain our capital position during a period of significant economic
uncertainty, especially for the financial services industry (although, as of December
31, 2009, Oritani Bank was considered well capitalized for regulatory purposes and is
not subject to any directive or recommendation from the FDIC or the New Jersey
Department of Banking and Insurance to raise capital); and
to use the additional capital for other general corporate purposes.
Table of Contents
Table of Contents
Fiscal 2010
Dividends
High
Low
per share
$
14.61
$
12.75
$
0.050
14.50
12.46
0.075
Fiscal 2009
Fiscal 2008
Dividend
Dividend
High
Low
per share
High
Low
per share
$
20.12
$
15.50
$
$
15.93
$
12.55
$
17.33
13.25
17.23
12.17
17.04
9.56
15.25
10.78
15.10
12.73
0.05
17.15
14.87
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Oritani Bank Historical
Pro Forma at December 31, 2009 Based Upon the Sale at $10.00 Per Share
at
December 31, 2009
33,150,000 Shares
39,000,000 Shares
44,850,000 Shares
51,577,500 Shares (1)
Percent of
Percent of
Percent of
Percent of
Percent of
Amount
Assets (2)
Amount
Assets (2)
Amount
Assets (2)
Amount
Assets (2)
Amount
Assets (2)
(Dollars in thousands)
$
194,340
9.84
%
$
327,213
15.33
%
$
350,801
16.22
%
$
374,388
17.08
%
$
401,513
18.05
%
$
193,183
9.76
%
$
326,056
15.25
%
$
349,644
16.14
%
$
373,231
17.01
%
$
400,356
17.98
%
79,144
4.00
%
85,512
4.00
%
86,642
4.00
%
87,773
4.00
%
89,073
4.00
%
$
114,039
5.76
%
$
240,544
11.25
%
$
263,002
12.14
%
$
285,458
13.01
%
$
311,283
13.98
%
$
193,183
13.49
%
$
326,056
22.27
%
$
349,644
23.79
%
$
373,231
25.29
%
$
400,356
27.01
%
85,943
6.00
%
87,854
6.00
%
88,193
6.00
%
88,532
6.00
%
88,922
6.00
%
$
107,240
7.49
%
$
238,201
16.27
%
$
261,451
17.79
%
$
284,699
19.29
%
$
311,434
21.01
%
$
211,236
14.75
%
$
344,109
23.50
%
$
367,697
25.02
%
$
391,284
26.52
%
$
418,409
28.23
%
114,591
8.00
%
117,138
8.00
%
117,590
8.00
%
118,043
8.00
%
118,563
8.00
%
$
96,645
6.75
%
$
226,971
15.50
%
$
250,107
17.02
%
$
273,241
18.52
%
$
299,846
20.23
%
$
159,184
$
187,452
$
215,719
$
248,226
(13,260
)
(15,600
)
(17,940
)
(20,631
)
(13,260
)
(15,600
)
(17,940
)
(20,631
)
209
209
209
209
$
132,873
$
156,461
$
180,048
$
207,173
(1)
As adjusted to give effect to an increase in the number of shares of common stock that
could occur due to a 15% increase in the offering range to reflect demand for the
shares, or changes in market or general financial conditions following the commencement
of the offering.
(2)
Tangible and core capital levels are shown as a percentage of total adjusted assets.
Risk-based capital levels are shown as a percentage of risk-weighted assets.
(3)
Although not adopted in regulation form, the New Jersey Department of Banking and Insurance
utilizes capital standards of 6% leverage capital and 8.0% risk-based capital. In addition,
the FDIC requires a Tier 1 risk-based capital ratio of 4.0% or greater.
(4)
Pro forma capital levels assume that we fund the stock-based incentive plans with purchases
in the open market equal to 4.0% of the shares of common stock sold in the stock offering at a
price equal to the price for which the shares of common stock are sold in the stock offering,
and that the employee stock ownership plan purchases 4.0% of the shares of common stock sold
in the stock offering with funds we lend. Pro forma GAAP and regulatory capital have been
reduced by the amount required to fund both of these plans. See Management for a discussion
of the stock-based incentive plan and employee stock ownership plan. We may award shares of
common stock under one or more stock-based incentive plans in excess of this amount if the
stock-based incentive plans are adopted more than one year following the stock offering.
(5)
Pro forma amounts and percentages assume net proceeds are invested in assets that carry a 20%
risk weighting.
Table of Contents
Oritani
Financial Corp.
Historical at
Oritani $10.00 Per Share Pro Forma Based on the Sale of
December 31,
33,150,000
39,000,000
44,850,000
51,577,500
2009
Shares
Shares
Shares
Shares (1)
(Dollars in thousands)
$
1,210,507
$
1,210,507
$
1,210,507
$
1,210,507
$
1,210,507
507,439
507,439
507,439
507,439
507,439
$
1,717,946
$
1,717,946
$
1,717,946
$
1,717,946
$
1,717,946
130
445
524
602
693
132,339
450,393
506,849
563,305
628,229
182,528
182,528
182,528
182,528
182,528
209
209
209
209
1,114
1,114
1,114
1,114
1,114
(54,649
)
(54,649
)
(54,649
)
(54,649
)
(54,649
)
(13,512
)
(26,772
)
(29,112
)
(31,452
)
(34,143
)
(13,260
)
(15,600
)
(17,940
)
(20,631
)
$
247,950
$
540,008
$
591,863
$
643,717
$
703,350
44,529,252
52,387,355
60,245,458
69,282,277
11,379,252
13,387,355
15,395,458
17,704,777
33,150,000
39,000,000
44,850,000
51,577,500
12.36
%
23.49
%
25.18
%
26.79
%
28.57
%
12.36
%
23.49
%
25.18
%
26.79
%
28.57
%
(1)
As adjusted to give effect to an increase in the number of shares of common stock that could
occur due to a 15% increase in the offering range to reflect demand for the shares, or changes
in market or general financial conditions following the commencement of the offering.
(2)
Does not reflect withdrawals from deposit accounts for the purchase of shares of common stock
in the offering. These withdrawals would reduce pro forma deposits by the amount of the
withdrawals.
(3)
Oritani Financial Corp. currently has 10,000,000 authorized shares of preferred stock and
80,000,000 authorized shares of common stock, par value $0.01 per share. On a pro forma
basis, Oritani common stock and additional paid-in capital have been revised to reflect the
number of shares of Oritani common stock to be outstanding, which is 44,592,252 shares,
52,387,355 shares, 60,245,458 shares and 69,282,277 shares at the minimum, midpoint, maximum
and adjusted maximum of the offering range, respectively.
(4)
No effect has been given to the issuance of additional shares of Oritani common stock
pursuant to stock options to be granted under a stock-based incentive plan. If this plan
is implemented within one year of the completion of the offering, an amount up to 10.0% of
the shares of Oritani common stock sold in the offering will be reserved for issuance upon
the exercise of options. We may exceed this limit if the plan is implemented more than
one year following the completion of the offering. No effect has been given to the
exercise of options currently outstanding. See ManagementBenefits to be Considered
Following Completion of the Conversion.
(5)
The retained earnings of Oritani Bank will be substantially restricted after the
conversion. See The Conversion and OfferingLiquidation Rights and Supervision and
Regulation.
Table of Contents
(6)
Assumes that 4.0% of the shares sold in the offering will be acquired by the employee
stock ownership plan financed by a loan from Oritani The loan will have a term of 20 years
and an interest rate equal to the prime rate as published in
The Wall Street Journal
,
and be repaid principally from Oritani Banks contributions to the employee stock
ownership plan. Since Oritani will finance the employee stock ownership plan debt, this
debt will be eliminated through consolidation and no liability will be reflected on
Oritanis consolidated financial statements. Accordingly, the amount of shares of common
stock acquired by the employee stock ownership plan is shown in this table as a reduction
of total stockholders equity.
(7)
Assumes at the minimum, midpoint, the maximum and the maximum as adjusted, of the
offering range that a number of shares of common stock equal to 4.0% of the shares of
common stock to be sold in the offering will be purchased by the stock-based incentive
plan in open market purchases. The stock-based incentive plan will be submitted to a vote
of stockholders following the completion of the offering. Our current intent is to
implement a new stock-based incentive plan no earlier than twelve months after completion
of the conversion. The funds to be used by the stock-based incentive plan to purchase the
shares will be provided by Oritani. The dollar amount of common stock to be purchased is
based on the $10.00 per share offering price and represents unearned compensation. This
amount does not reflect possible increases or decreases in the value of common stock
relative to the subscription price in the offering. As Oritani accrues compensation
expense to reflect the vesting of shares pursuant to the stock-based incentive plan, the
credit to capital will be offset by a charge to operations. Implementation of the
stock-based incentive plan will require stockholder approval.
Table of Contents
(i)
forty percent of all shares of common stock will be sold in the subscription
and community offerings, including shares purchased by insiders, with the remaining
shares to be sold in the syndicated community offering;
(ii)
150,000 shares of common stock will be purchased by our executive officers and
directors, and their associates;
(iii)
our employee stock ownership plan will purchase 4.0% of the shares of common
stock sold in the offering, with a loan from Oritani. The loan will be repaid in
substantially equal payments of principal and interest over a period of 20 years;
(iv)
Stifel, Nicolaus & Company, Incorporated will receive a fee equal to 1% of all
shares of common stock sold in the subscription and community offerings and a fee equal
to 5% of all shares sold in the syndicated community offering. No fee will be paid
with respect to shares of common stock purchased by our qualified and non-qualified
employee stock benefit plans, or stock purchased by our officers, directors and
employees, and their immediate families; and
(v)
total expenses of the offering, including the marketing fees to be paid to
Stifel, Nicolaus & Company, Incorporated, will be between $13.1 million at the minimum
of the offering range and $19.3 million at the maximum of the offering range, as
adjusted.
Table of Contents
withdrawals from deposit accounts for the purpose of purchasing shares of
common stock in the stock offering;
our results of operations after the stock offering; or
changes in the market price of the shares of common stock after the stock
offering.
Table of Contents
At or for the Six Months Ended December 31, 2009
Based Upon the Sale at $10.00 Per Share of
33,150,000
39,000,000
44,850,000
51,577,500
Shares
Shares
Shares
Shares (1)
(Dollars in thousands, except per share amounts)
$
331,500
$
390,000
$
448,500
$
515,775
113,793
133,874
153,955
177,048
$
445,293
$
523,874
$
602,455
$
692,823
$
331,500
$
390,000
$
448,500
$
515,775
(13,131
)
(15,096
)
(17,062
)
(19,322
)
$
209
$
209
$
209
$
209
$
318,578
$
375,113
$
431,647
$
496,662
(13,260
)
(15,600
)
(17,940
)
(20,631
)
(13,260
)
(15,600
)
(17,940
)
(20,631
)
$
292,058
$
343,913
$
395,767
$
455,400
$
7,412
$
7,412
$
7,412
$
7,412
2,395
2,820
3,246
3,735
(202
)
(238
)
(274
)
(315
)
(809
)
(952
)
(1,095
)
(1,259
)
(916
)
(1,077
)
(1,239
)
(1,424
)
$
7,880
$
7,966
$
8,051
$
8,150
$
0.17
$
0.14
$
0.12
$
0.11
0.05
0.06
0.06
0.05
(0.02
)
(0.02
)
(0.02
)
(0.02
)
(0.02
)
(0.02
)
(0.02
)
(0.02
)
$
0.18
$
0.16
$
0.14
$
0.12
27.78
x
31.25
x
35.71
x
41.67
x
43,236,402
50,866,355
58,496,308
67,270,754
$
247,950
$
247,950
$
247,950
$
247,950
318,369
374,904
431,438
496,453
209
209
209
209
(13,260
)
(15,600
)
(17,940
)
(20,631
)
(13,260
)
(15,600
)
(17,940
)
(20,631
)
$
540,008
$
591,863
$
643,717
$
703,350
$
5.57
$
4.73
$
4.11
$
3.58
7.15
7.16
7.16
7.17
0.01
0.01
0.01
0.01
(0.30
)
(0.30
)
(0.30
)
(0.30
)
(0.30
)
(0.30
)
(0.30
)
(0.30
)
$
12.13
$
11.30
$
10.68
$
10.15
82.44
%
88.50
%
93.63
%
98.52
%
82.44
%
88.50
%
93.63
%
98.52
%
44,529,252
52,387,355
60,245,458
69,282,277
Table of Contents
(1)
As adjusted to give effect to an increase in the number of shares that could occur due to a
15% increase in the offering range to reflect demand for the shares, or changes in market or
financial conditions following the commencement of the offering.
(2)
Assumes that 4.0% of shares of common stock sold in the offering will be purchased by the
employee stock ownership plan. For purposes of this table, the funds used to acquire these
shares are assumed to have been borrowed by the employee stock ownership plan from Oritani.
The loan will have a term of 20 years and an interest rate equal to the prime rate as
published in
The Wall Street Journal
. Oritani Bank intends to make annual contributions to
the employee stock ownership plan in an amount at least equal to the required principal and
interest payments on the debt. Oritani Banks total annual payments on the employee stock
ownership plan debt are based upon 20 equal annual
installments of principal and interest. Statement of Position 93-6, Employers Accounting for
Employee Stock Ownership Plans (SOP 93-6), requires that an employer record compensation
expense in an amount equal to the fair value of the shares committed to be released to
employees. The pro forma adjustments assume that: (i) the employee stock ownership plan shares
are allocated in equal annual installments based on the number of loan repayment installments
assumed to be paid by Oritani Bank, (ii) the fair value of the common stock remains equal to the
$10.00 subscription price; and (iii) the employee stock ownership plan expense reflects an
effective combined federal and state tax rate of 39.0%. The unallocated employee stock
ownership plan shares are reflected as a reduction of stockholders equity. No reinvestment is
assumed on proceeds contributed to fund the employee stock ownership plan. The pro forma net
income further assumes that 33,150, 39,000, 44,850 and 51,578 shares were committed to be
released during the period at the minimum, midpoint, maximum, and adjusted maximum of the
offering range, respectively, and in accordance with SOP 93-6, only the employee stock ownership
plan shares committed to be released during the period were considered outstanding for purposes
of net income per share calculations.
(3)
Gives effect to the grant of restricted stock awards pursuant to the stock-based incentive
plan expected to be adopted by following the offering and presented to stockholders for
approval not earlier than twelve months after the completion of the offering. We have assumed
that at the minimum, midpoint, maximum and maximum as adjusted, of the offering range this
plan acquires a number of shares of restricted common stock equal to 4.0% of the shares sold
in the offering, either through open market purchases, from authorized but unissued shares of
common stock or treasury stock. Funds used by the stock-based incentive plan to purchase the
shares of common stock will be contributed by Oritani. In calculating the pro forma effect of
the stock-based incentive plan, it is assumed that the shares of restricted stock were
acquired by the plan in open market purchases at the beginning of the period presented for a
purchase price equal to the price for which the shares are sold in the offering, and that
10.0% of the amount contributed was an amortized expense (20.0% annually based upon a
five-year vesting period) during the six months ended December 31, 2009. There can be no
assurance that the actual purchase price of the shares of common stock granted under the
stock-based incentive plan will be equal to the $10.00 subscription price. If shares are
acquired from authorized but unissued shares of common stock or from treasury shares, our net
income per share and stockholders equity per share will decrease. This will also have a
dilutive effect of approximately 2.89% (at the maximum of the offering range) on the ownership
interest of stockholders. The impact on pro forma net income per share and pro forma
stockholders equity per share is not material.
(4)
Gives effect to the granting of options pursuant to the stock-based incentive plan, which is
expected to be adopted by Oritani following the offering and presented to stockholders for
approval not earlier than twelve months after the completion of the offering. We have assumed
that options will be granted to acquire shares of common stock equal to 10.0% of the shares
sold in the offering. In calculating the pro forma effect of the stock options, it is assumed
that the exercise price of the stock options and the trading price of the stock at the date of
grant were $10.00 per share, and the estimated grant-date fair value pursuant to the
application of the Black-Scholes option pricing model was $3.43 for each option. The pro
forma net income assumes that the options granted under the stock-based incentive plan have a
value of $3.43 per option, which was determined using the Black-Scholes option pricing formula
using the following assumptions: (i) the trading price on date of grant was $10.00 per share;
(ii) exercise price is equal to the trading price on the date of grant; (iii) dividend yield
of 3.0%; (iv) expected life of ten years; (v) expected volatility of 36.45%; (vi) risk-free
interest rate of 3.85%, and (vii) 50% of the options awarded are non-qualified options. If
the fair market value per share on the date of grant is different than $10.00, or if the
assumptions used in the option pricing formula are different from those used in preparing this
pro forma data, the value of options and the related expense recognized will be different.
The aggregate grant date fair value of the stock options was amortized to expense on a
straight-line basis over a five-year vesting period of the options. There can be no assurance
that the actual exercise price of the stock options will be equal to the $10.00 price per
share. If a portion of the shares to satisfy the exercise of options under the stock-based
incentive plan is obtained from the issuance of authorized but unissued shares of common
stock, our net income and stockholders equity per share will decrease. This also will have a
dilutive effect of up to 6.93% on the ownership interest of persons who purchase shares of
common stock in the offering.
(5)
The number of shares used to calculate pro forma net income per share is equal to the total
number of shares to be outstanding upon completion of the offering, and subtracting the
employee stock ownership plan shares which have not been committed for release during the
period in accordance with SOP 93-6. See footnote 2, above.
(6)
The retained earnings of Oritani Bank will be substantially restricted after the conversion.
See Our Policy Regarding Dividends, The Conversion and OfferingLiquidation Rights and
Supervision and Regulation.
(7)
Per share figures include publicly held shares of Oritani Financial Corp. common stock that
will be exchanged for shares of Oritani common stock in the conversion. Stockholders equity
per share calculations are based upon the sum of (i) the number of subscription shares assumed
to be sold in the offering; and (ii) shares to be issued in exchange for publicly held shares.
(8)
The number of shares used to calculate pro forma stockholders equity per share is equal to
the total number of shares to be outstanding upon completion of the offering.
Table of Contents
At or for the Year Ended June 30, 2009
Based Upon the Sale at $10.00 Per Share of
33,150,000
39,000,000
44,850,000
51,577,500
Shares
Shares
Shares
Shares (1)
(Dollars in thousands, except per share amounts)
$
331,500
$
390,000
$
448,500
$
515,775
113,793
133,874
153,955
177,048
$
445,293
$
523,874
$
602,455
$
692,823
$
331,500
$
390,000
$
448,500
$
515,775
(13,131
)
(15,096
)
(17,062
)
(19,322
)
209
209
209
209
$
318,578
$
375,113
$
431,647
$
496,662
(13,260
)
(15,600
)
(17,940
)
(20,631
)
(13,260
)
(15,600
)
(17,940
)
(20,631
)
$
292,058
$
343,913
$
395,767
$
455,400
$
5,552
$
5,552
$
5,552
$
5,552
4,522
5,325
6,129
7,053
(404
)
(476
)
(547
)
(629
)
(1,618
)
(1,903
)
(2,189
)
(2,517
)
(1,831
)
(2,154
)
(2,477
)
(2,848
)
$
6,221
$
6,344
$
6,468
$
6,611
$
0.13
$
0.11
$
0.10
$
0.08
0.10
0.10
0.10
0.11
(0.01
)
(0.01
)
(0.01
)
(0.01
)
(0.04
)
(0.04
)
(0.04
)
(0.04
)
(0.04
)
(0.04
)
(0.04
)
(0.04
)
$
0.14
$
0.12
$
0.11
$
0.10
71.43
x
83.33
x
90.91
x
100.00
x
42,269,552
50,905,355
58,541,158
67,322,332
$
240,098
$
240,098
$
240,098
$
240,098
318,369
374,904
431,438
496,453
209
209
209
209
(13,260
)
(15,600
)
(17,940
)
(20,631
)
(13,260
)
(15,600
)
(17,940
)
(20,631
)
$
532,156
$
584,011
$
635,865
$
695,498
$
5.39
$
4.58
$
3.98
$
3.46
7.15
7.16
7.16
7.17
0.01
0.01
0.01
0.01
(0.30
)
(0.30
)
(0.30
)
(0.30
)
(0.30
)
(0.30
)
(0.30
)
(0.30
)
$
11.95
$
11.15
$
10.55
$
10.04
83.68
%
89.69
%
94.79
%
99.60
%
53.68
%
89.69
%
94.79
%
99.60
%
44,529,252
52,387,355
60,245,458
69,282,277
Table of Contents
(1)
As adjusted to give effect to an increase in the number of shares that could occur due to a
15% increase in the offering range to reflect demand for the shares, or changes in market and
financial conditions following the commencement of the offering.
(2)
Assumes that 4.0% of shares of common stock sold in the offering will be purchased by the
employee stock ownership plan. For purposes of this table, the funds used to acquire
these shares are assumed to have been borrowed by the employee stock ownership plan from
Oritani. The loan will have a term of 20 years and an interest rate equal to the prime
rate as published in
The Wall Street Journal
. Oritani Bank intends to make annual
contributions to the employee stock ownership plan in an amount at least equal to the
required principal and interest payments on the debt. Oritani Banks total annual
payments on the employee stock ownership plan debt are based upon 20 equal annual
installments of principal and interest. SOP 93-6 requires that an employer record
compensation expense in an amount equal to the fair value of the shares committed to be
released to employees. The pro forma adjustments assume that: (i) the
employee stock ownership plan shares are allocated in equal annual installments based on the
number of loan repayment installments assumed to be paid by Oritani Bank; (ii) the fair
value of the common stock remains equal to the $10.00 subscription price and (iii) the
employee stock ownership plan expense reflects an effective combined federal and state tax
rate of 39%. The unallocated employee stock ownership plan shares are reflected as a
reduction of stockholders equity. No reinvestment is assumed on proceeds contributed to
fund the employee stock ownership plan. The pro forma net income further assumes that
66,300, 78,000, 89,700 and 103,155 shares were committed to be released during the year at
the minimum, midpoint, maximum, and adjusted maximum of the offering range, respectively,
and in accordance with SOP 93-6, only the employee stock ownership plan shares committed to
be released during the year were considered outstanding for purposes of net income per share
calculations.
(3)
Gives effect to the grant of restricted stock awards pursuant to the stock-based
incentive plan expected to be adopted by following the offering and presented to
stockholders for approval not earlier than six months after the completion of the
offering. We have assumed that at the midpoint, maximum and maximum as adjusted, of the
offering range this plan acquires a number of shares of restricted common stock equal to
4.0% of the shares sold in the stock offering, either through open market purchases, from
authorized but unissued shares of common stock or treasury stock. Funds used by the
stock-based incentive plan to purchase the shares of restricted stock will be contributed
by Oritani. In calculating the pro forma effect of the stock-based incentive plan, it is
assumed that the shares of common stock were acquired by the plan in open market purchases
at the beginning of the period presented for a purchase price equal to the price for which
the shares are sold in the offering, and that 20.0% of the amount contributed was an
amortized expense (based upon a five-year vesting period) during the year ended June 30,
2009. There can be no assurance that the actual purchase price of the shares of common
stock granted under the stock-based incentive plan will be equal to the $10.00
subscription price. If shares are acquired from authorized but unissued shares of common
stock or from treasury shares, our net income per share and stockholders equity per share
will decrease. This will also have a dilutive effect of approximately 2.89% (at the
maximum of the offering range) on the ownership interest of stockholders. The impact on
pro forma net income per share and pro forma stockholders equity per share is not
material.
(4)
Gives effect to the granting of options pursuant to the stock-based incentive plan, which is
expected to be adopted by following the offering and presented to stockholders for approval
not earlier than twelve months after the completion of the offering. We have assumed that
options will be granted to acquire shares of common stock equal to 10.0% of the shares sold in
the offering. In calculating the pro forma effect of the stock options, it is assumed that
the exercise price of the stock options and the trading price of the stock at the date of
grant were $10.00 per share, and the estimated grant date fair value pursuant to the
application of the Black-Scholes option pricing model was $3.43 for each option. The pro
forma net income assumes that the options granted under the stock-based incentive plan have a
value of $3.43 per option, which was determined using the Black-Scholes option pricing formula
using the following assumptions: (i) the trading price on date of grant was $10.00 per share;
(ii) exercise price is equal to the trading price on the date of grant; (iii) dividend yield
of 3.00%; (iv) expected life of ten years; (v) expected volatility of 36.45%; (vi) risk-free
interest rate of 3.85%, and (vii) 50% of the options awarded are non-qualified options. If
the fair market value per share on the date of grant is different than $10.00, or if the
assumptions used in the option pricing formula are different from those used in preparing this
pro forma data, the value of options and the related expense recognized will be different.
The aggregate grant-date fair value of the stock options was amortized to expense on a
straight-line basis over a five-year vesting period of the options. There can be no assurance
that the actual exercise price of the stock options will be equal to the $10.00 price per
share. If a portion of the shares to satisfy the exercise of options under the stock-based
incentive plan is obtained from the issuance of authorized but unissued shares of common
stock, our net income and stockholders equity per share will decrease. This also will have a
dilutive effect of up to 6.93% on the ownership interest of persons who purchase shares of
common stock in the offering.
(5)
The number of shares used to calculate pro forma net income per share is equal to the total
number of shares to be outstanding upon completion of the offering, plus the shares
contributed, and subtracting the employee stock ownership plan shares which have not been
committed for release during the period in accordance with SOP 93-6. See footnote 2, above.
(6)
The retained earnings of Oritani Bank will be substantially restricted after the conversion.
See Our Policy Regarding Dividends, The Conversion and OfferingLiquidation Rights and
Supervision and Regulation.
(7)
Per share figures include publicly held shares of Oritani Financial Corp. common stock that
will be exchanged for shares of Oritani common stock in the conversion. Stockholders equity
per share calculations are based upon the sum of (i) the number of subscription shares assumed
to be sold in the offering; and (ii) shares to be issued in exchange for publicly held shares.
The number of subscription shares actually sold and the corresponding number of exchange
shares may be more or less than the assumed amounts.
(8)
The number of shares used to calculate pro forma stockholders equity per share is equal to
the total number of shares to be outstanding upon completion of the offering.
Table of Contents
AND RESULTS OF OPERATIONS
Table of Contents
Table of Contents
Table of Contents
Table of Contents
Table of Contents
December 31, 2009
September 30, 2009
June 30, 2009
March 31, 2009
December 31, 2008
(Dollars in thousands)
$
9,613
$
14,318
$
6,727
$
4,897
4,979
1,974
1,049
17,825
2,130
5,942
51,907
52,557
52,465
52,260
44,067
$
63,494
$
67,924
$
77,017
$
59,287
$
54,988
Table of Contents
Table of Contents
Table of Contents
Table of Contents
Table of Contents
June 30, 2009
June 30, 2008
June 30, 2007
(In thousands)
$
6,727
$
27,985
$
555
17,825
18
39
47,839
13,876
$
72,391
$
41,879
$
594
Table of Contents
Table of Contents
June 30, 2008
June 30, 2007
(In thousands)
$
27,985
$
555
18
39
13,876
$
41,879
$
594
Table of Contents
Table of Contents
For the Six Months Ended (unaudited)
December 31, 2009
December 31, 2008
Average
Average
Average
Average Outstanding
Interest
Yield/
Outstanding
Interest
Yield/
Balance
Earned/Paid
Rate
Balance
Earned/Paid
Rate
(Dollars in thousands)
$
1,336,861
$
42,065
6.29
%
$
1,123,438
$
34,645
6.17
%
25,513
717
5.62
24,646
535
4.34
260,372
3,738
2.87
29,035
633
4.36
103,686
1,918
3.70
153,587
3,032
3.95
117,249
2,718
4.64
149,065
3,673
4.93
48,471
90
0.37
258
1
0.78
1,892,152
51,246
5.42
1,480,029
42,519
5.75
%
86,387
77,036
$
1,978,539
$
1,557,065
$
146,313
675
0.92
%
$
144,709
1,069
1.48
%
237,403
2,008
1.69
70,882
1,076
3.04
101,795
404
0.79
75,084
323
0.86
702,046
9,036
2.57
470,220
8,648
3.68
1,187,557
12,123
2.04
760,895
11,116
2.92
508,145
10,494
4.13
502,393
9,940
3.96
1,695,702
22,617
2.67
%
1,263,288
21,056
3.33
%
39,125
32,051
1,734,827
1,295,339
243,712
261,726
$
1,978,539
$
1,557,065
$
28,629
$
21,463
2.75
%
2.42
%
$
196,450
$
216,741
3.03
%
2.90
%
111.59
%
117.16
%
(1)
Includes nonaccrual loans.
(2)
Includes Federal Home Loan Bank Stock.
(3)
Net interest rate spread represents the difference between the yield on average
interest-earning assets and the cost of average interest-bearing liabilities.
(4)
Net interest-earning assets represents total interest-earning assets less total
interest-bearing liabilities.
(5)
Net interest margin represents net interest income divided by average total interest-earning
assets.
Table of Contents
For the Years Ended June 30,
2009
2008
2007
Average
Average
Average
Outstanding
Yield/
Outstanding
Yield/
Outstanding
Yield/
Balance
Interest
Rate
Balance
Interest
Rate
Balance
Interest
Rate
(Dollars in thousands)
$
1,181,385
$
72,158
6.11
%
$
858,223
$
55,053
6.41
%
$
693,902
$
44,278
6.38
%
67,479
2,468
3.66
34,464
1,716
4.98
15,789
868
5.50
24,937
1,069
4.29
19,192
999
5.21
19,093
1,073
5.62
145,713
7,046
4.84
91,060
4,710
5.17
16,147
813
5.03
142,484
5,615
3.94
192,007
7,409
3.86
245,625
9,475
3.86
25,021
73
0.29
45,292
1,704
3.76
127,215
6,842
5.38
1,587,019
88,429
5.57
1,240,238
71,591
5.77
1,117,771
63,349
5.67
%
84,535
69,806
62,293
$
1,671,554
$
1,310,044
$
1,180,064
$
144,810
1,979
1.37
%
$
151,068
2,427
1.61
%
$
211,397
3,093
1.46
%
103,932
2,626
2.53
50,263
1,730
3.44
32,673
1,195
3.66
75,324
628
0.83
71,176
812
1.14
75,153
868
1.15
556,730
19,029
3.42
420,787
18,896
4.49
425,563
18,526
4.35
880,796
24,262
2.75
693,294
23,865
3.44
744,786
23,682
3.18
505,599
20,238
4.00
310,231
13,343
4.30
210,598
9,147
4.34
1,386,395
44,500
3.21
%
1,003,525
37,208
3.71
%
955,384
32,829
3.44
%
33,071
27,438
23,319
1,419,466
1,030,963
978,703
252,088
279,081
201,361
$
1,671,554
$
1,310,044
$
1,180,064
$
43,929
$
34,383
$
30,520
2.36
%
2.06
%
2.23
%
$
200,624
$
236,713
$
162,387
2.77
%
2.77
%
2.73
%
114.47
%
123.59
%
117.00
%
(1)
Includes nonaccrual loans.
(2)
Net interest rate spread represents the difference between the weighted-average yield on
interest-earning assets and the weighted- average cost of interest-bearing liabilities for the
period.
(3)
Net interest-earning assets represents total interest-earning assets less interest-bearing
liabilities.
(4)
Net interest margin represents net interest income as a percent of average interest-earning
assets for the period.
Table of Contents
Six Months Ended December 31,
Years Ended June 30,
Years Ended June 30,
2009 vs. 2008
2009 vs. 2008
2008 vs. 2007
Increase (Decrease)
Total
Increase (Decrease)
Total
Increase (Decrease) Due
Total
Due to
Increase
Due to
Increase
to
Increase
Volume
Rate
(Decrease)
Volume
Rate
(Decrease)
Volume
Rate
(Decrease)
(In thousands)
$
6,582
$
838
$
7,420
$
20,730
$
(3,625
)
$
17,105
$
10,485
$
290
$
10,775
5,043
(1,938
)
3,105
1,644
(892
)
752
1,027
(179
)
848
19
163
182
299
(229
)
70
6
(80
)
(74
)
(784
)
(171
)
(955
)
2,827
(491
)
2,336
3,772
125
3,897
(985
)
(129
)
(1,114
)
(1,911
)
117
(1,794
)
(2,068
)
2
(2,066
)
187
(98
)
89
(763
)
(868
)
(1,631
)
(4,406
)
(732
)
(5,138
)
10,062
(1,335
)
8,727
22,826
(5,988
)
16,838
8,816
(574
)
8,242
12
(406
)
(394
)
(101
)
(347
)
(448
)
(883
)
217
(666
)
2,528
(1,596
932
1,847
(951
)
896
643
(108
)
535
115
(34
)
81
47
(231
)
(184
)
(46
)
(10
)
(56
)
4,264
(3,876
)
388
6,105
(5,972
)
133
(208
)
578
370
6,918
(5,911
)
1,007
7,898
(7,501
)
397
(494
)
677
183
114
440
554
8,403
(1,508
)
6,895
4,327
(131
)
4,196
7,032
(5,471
)
1,561
16,301
(9,009
)
7,292
3,833
546
4,379
$
3,030
$
4,136
$
7,166
$
6,525
$
3,021
$
9,546
$
4,983
$
(1,120
)
$
3,863
Table of Contents
(i)
originating multi-family and commercial real estate loans that generally tend
to have shorter interest duration and generally reset at five years;
(ii)
investing in shorter duration securities and mortgage-backed securities; and
(iii)
obtaining general financing through FHLB advances with either a fixed long
term or with call options that are considered unlikely.
Table of Contents
NPV as a Percentage of Present
Estimated Increase
Value of Assets (3)
(Decrease) in
Increase
Change in Interest
Estimated
NPV
(Decrease)
Rates (basis points) (1)
NPV (2)
Amount
Percent
NPV Ratio (4)
(basis points)
(Dollars in thousands)
203,351
(53,593
)
(20.86
)%
10.59
%
(209
)
256,944
12.68
278,886
21,942
8.54
13.42
74
(1)
Assumes an instantaneous uniform change in interest rates at all maturities.
(2)
NPV is the discounted present value of expected cash flows from assets,
liabilities and off-balance sheet contracts.
(3)
Present value of assets represents the discounted present value of incoming
cash flows on interest-earning assets.
(4)
NPV Ratio represents NPV divided by the present value of assets.
expected loan demand;
expected deposit flows;
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expected payments from the loan and investment portfolios;
funds available through borrowings;
yields available on interest-earning deposits and securities;
yields and structures available on alternate investments; and
the objectives of our asset/liability management program
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Actual
Required
Amount
Ratio
Amount
Ratio
$
209,882
15.8
%
$
106,101
8.0
%
193,248
14.6
53,050
4.0
193,248
10.6
72,963
4.0
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Payments Due by Period
Less than
One to Three
Three to Five
More than
Contractual Obligations
One Year
Years
Years
Five Years
Total
(In thousands)
$
10,341
$
56,413
$
130,685
$
310,000
$
507,439
289
546
375
370
1,580
$
10,630
$
56,959
$
131,060
$
310,370
$
509,019
$
49,888
$
$
1,700
$
$
47,588
$
27,722
$
$
$
$
27,722
$
34,673
$
$
$
$
34,673
$
15,000
$
$
$
$
15,000
Payments Due by Period
Less than
One to Three
Three to Five
More than
Contractual Obligations
One Year
Years
Years
Five Years
Total
(In thousands)
$
10,372
$
57,934
$
110,685
$
330,000
$
508,991
289
570
418
448
1,725
$
10,661
$
58,504
$
111,103
$
330,448
$
510,716
$
77,729
$
$
$
$
77,729
$
39,708
$
$
$
$
39,708
$
33,800
$
$
$
$
33,800
$
20,000
$
$
$
$
20,000
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At December 31,
At June 30,
2009
2009
2008
2007
2006
2005
Amount
Percent
Amount
Percent
Amount
Percent
Amount
Percent
Amount
Percent
Amount
Percent
(Dollars in thousands)
$
260,056
18.8
%
$
265,962
20.4
%
$
223,087
21.8
%
$
188,941
24.6
%
$
165,070
25.3
%
$
147,284
29.4
%
296,314
21.4
277,589
21.3
237,490
23.2
210,587
27.4
205,351
31.5
183,118
36.5
628,507
45.5
562,139
43.2
359,681
35.2
240,544
31.3
173,857
26.6
88,306
17.6
51,036
3.7
54,768
4.2
59,886
5.8
65,240
8.5
66,198
10.2
55,672
11.1
124,898
9.0
130,831
10.0
138,195
13.5
62,704
8.1
38,722
5.9
24,629
4.9
21,612
1.6
10,993
0.8
4,880
0.5
1,140
0.1
3,291
0.5
2,321
0.5
1,382,423
100.0
%
1,302,282
100.0
%
1,023,219
100.0
%
769,156
100.0
%
652,489
100.0
%
501,330
100.0
%
3,102
2,979
2,610
1,732
1,753
1,604
22,164
20,680
13,532
8,882
7,672
6,172
$
1,357,157
$
1,278,623
$
1,007,077
$
758,542
$
643,064
$
493,554
First Mortgage
Second Mortgage
Construction and Land
Other Loans
Total
Weighted
Amount
Average Rate
Amount
Percent
Amount
Percent
Amount
Percent
Amount
Percent
(Dollars in thousands)
$
6,500
6.92
%
$
89
5.04
%
$
103,885
7.21
%
$
7,989
3.87
%
$
118,463
6.97
%
6,140
6.54
340
5.25
24,011
5.41
1,581
6.93
32,072
5.70
51,852
6.10
2,215
5.70
481
7.85
54,548
6.10
282,566
6.24
12,172
5.35
2,406
6.52
548
6.85
297,692
6.21
284,603
6.12
17,741
5.61
302,344
6.09
474,028
6.12
22,212
5.89
529
5.09
394
6.28
497,163
6.11
$
1,105,689
6.16
%
$
54,769
5.67
%
$
130,831
6.86
%
$
10,993
4.72
$
1,302,282
6.20
%
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Due After June 30, 2010
Fixed
Adjustable
Total
(In thousands)
$
219,743
$
46,194
$
265,937
71,789
205,245
277,034
291,122
265,096
556,218
46,785
7,895
54,680
3,637
23,309
26,946
1,626
1,378
3,004
$
634,702
549,117
$
1,183,819
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At December
At June 30,
31, 2009
2009
(1)
2008
(2)
2007
2006
2005
(Dollars in thousands)
$
1,760
$
98
$
67
$
$
458
$
147
1,076
6,291
30,871
25,685
44
18,200
20,391
14,143
51,907
$
52,465
$
14,210
$
$
458
$
191
$
$
$
$
$
$
$
$
$
$
$
$
51,907
$
52,465
$
14,210
$
$
458
$
191
600
$
52,507
$
52,465
$
14,210
$
$
458
$
191
3.75
%
4.03
%
1.39
%
%
0.07
%
0.04
%
2.62
%
2.74
%
0.98
%
%
0.04
%
0.02
%
(1)
Two construction loans totaling $4.2 million are less than 60 days delinquent at June 30,
2009 and are classified as non-accrual.
(2)
One construction loan totaling $335,000 was less than 60 days delinquent at June 30, 2008 and
was classified as non-accrual.
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Loans Delinquent For
60-89 Days
90 Days and Over
Total
Number
Amount
Number
Amount
Number
Amount
(Dollars in thousands)
1
$
196
3
$
1,341
4
$
1,537
3
704
7
31,948
10
32,652
1
62
1
62
1
1,012
4
18,618
5
19,630
6
$
1,974
14
$
51,907
20
$
53,881
1
$
197
2
$
98
3
$
295
2
6,291
2
6,291
3
17,209
6
25,685
9
42,894
1
419
6
20,391
7
20,810
5
$
17,825
16
$
47,839
21
$
65,664
$
2
$
68
2
$
68
1
18
1
18
2
13,808
2
13,808
1
$
18
4
$
13,876
5
$
13,894
$
$
$
1
39
1
39
1
$
39
$
1
$
39
5
$
180
2
$
348
7
$
528
5
$
180
2
$
348
7
$
528
3
$
139
3
$
140
6
$
279
1
29
1
44
2
73
4
$
168
4
$
184
8
$
352
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Classified Assets At
December 31, 2009
June 30, 2009
June 30, 2008
Number
Amount
Number
Amount
Number
Amount
Number
Amount
(Dollars in thousands)
3
$
1,341
2
$
109
3
$
85
$
1
1,076
5
7,602
9
36,199
9
28,827
4
14,375
2
238
5
1,012
4
19,273
18,618
1
141
19
$
58,388
20
$
55,811
7
$
14,460
2
$
238
$
4,460
$
3,896
$
1,497
$
24
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For the Six Months Ended
December 31,
At or For the Years Ended June 30,
2009
2008
2009
2008
2007
2006
2005
(Dollars in thousands)
$
20,681
$
13,532
$
13,532
$
8,882
$
7,672
$
6,172
$
5,372
16
260
785
2,726
2,250
43
222
3,570
2,732
3
3
(3,567
)
(2,732
)
5,050
5,375
9,880
4,650
1,210
1,500
800
$
22,164
$
18,907
$
20,680
$
13,532
$
8,882
$
7,672
$
6,172
0.53
%
%
0.23
%
%
%
%
%
1.60
%
1.54
%
1.59
%
1.32
%
1.15
%
1.18
%
1.23
%
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At December 31,
At June 30,
2009
2009
2008
2007
Percent of Loans
Percent of
Percent of
Percent of Loans in
in Each
Allowance
Loans in Each
Allowance
Loans in Each
Allowance for Loan
Each Category to
Allowance for Loan
Category to
for Loan
Category to
for Loan
Category to
Losses
Total Loans
Losses
Total Loans
Losses
Total Loans
Losses
Total Loans
(Dollars in thousands)
$
1,167
18.8
%
$
1,012
20.4
%
$
845
21.8
%
$
709
24.6
%
3,073
21.4
2,912
21.3
2,535
23.2
2,254
27.4
11,501
45.5
9,683
43.3
5,560
35.2
3,889
31.3
261
3.7
274
4.2
299
5.8
326
8.5
4,889
9.0
5,791
10.0
3,883
13.5
979
8.1
544
1.6
268
0.8
92
0.5
15
0.1
729
740
318
710
$
22,164
100.0
%
$
20,680
100.0
%
$
13,532
100.0
%
$
8,882
100.0
%
At June 30,
2006
2005
Percent of Loans
Percent of
Allowance
in Each
Loans in Each
for Loan
Category to
Allowance for
Category to
Losses
Total Loans
Loan Losses
Total Loans
(Dollars in thousands)
$
749
25.3
%
$
684
29.4
%
2,243
31.5
2,117
36.5
2,591
26.6
1,440
17.6
312
10.2
512
11.1
758
5.9
475
4.9
57
0.5
37
0.5
962
907
$
7,672
100.0
%
$
6,172
100.0
%
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At December 31,
At June 30,
2009
2009
2008
2007
Amortized
Amortized
Amortized
Amortized
Cost
Fair Value
Cost
Fair Value
Cost
Fair Value
Cost
Fair Value
(In thousands)
$
$
$
$
$
$
$
5,415
$
5,347
15,740
16,135
18,783
19,063
25,082
24,902
31,365
30,329
2,423
2,426
5,161
5,157
6,055
6,040
8,895
8,907
24,589
25,301
31,329
31,943
42,066
42,094
58,479
57,314
43,430
44,461
63,544
64,218
90,747
89,636
118,667
113,955
$
86,182
$
88,223
$
118,817
$
120,381
$
163,950
$
162,672
$
222,821
$
215,582
At December 31,
At June 30,
2009
2009
2008
2007
Amortized
Amortized
Amortized
Amortized Cost
Fair Value
Cost
Fair Value
Cost
Fair Value
Cost
Fair Value
(In thousands)
310,775
311,194
$
134,754
$
134,837
$
10,000
$
9,865
$
25,000
$
25,007
2,000
2,083
2,000
2,156
2,000
2,184
2,000
2,024
5,148
5,361
5,636
5,676
7,782
7,782
8,429
8,412
1,763
1,801
1,965
1,750
2,364
2,454
22,352
23,300
26,979
27,875
28,672
28,837
1,363
1,363
20,267
21,245
27,023
27,911
31,084
30,895
5,891
5,918
2,537
2,557
3,134
3,143
4,502
4,548
52,566
53,968
68,571
70,260
85,351
86,334
27,024
26,964
$
414,871
$
418,952
$
269,465
$
273,022
$
170,387
$
171,494
$
74,209
$
74,236
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More than One Year
More than Five Years
One Year or Less
through Five Years
through Ten Years
More than Ten Years
Total Securities
Weighted
Weighted
Weighted
Weighted
Weighted
Amortized
Average
Amortized
Average
Amortized
Average
Amortized
Average
Amortized
Average
Cost
Yield
Cost
Yield
Cost
Yield
Cost
Yield
Cost
Fair Value
Yield
(Dollars in thousands)
$
2,341
3.5
%
$
3,423
4.1
%
$
9,976
3.7
%
$
%
$
15,740
$
16,135
3.8
%
2,423
3.0
2,423
2,426
3.0
24,589
3.8
24,589
25,301
3.8
43,430
4.0
43,430
44,361
4.0
$
2,341
3.5
%
$
43,430
4.0
%
$
9,976
3.7
%
$
27,012
3.7
%
$
86,182
$
88,223
3.9
%
$
%
$
310,775
2.8
%
$
%
$
%
$
310,775
$
311,194
2.8
%
2,000
8.1
2,000
2,083
8.1
5,148
3.7
5,148
5,361
3.7
1,763
1,763
1,801
2,800
3.5
12,274
4.6
7,278
4.6
22,352
23,300
4.5
20,267
4.9
20,267
21,245
4.9
52,566
4.9
52,566
53,968
4.9
$
9,711
3.0
%
$
377,615
3.1
%
$
%
$
27,545
4.8
%
$
414,871
$
418,952
3.3
%
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At December 31,
At June 30,
At June 30,
2009
2009
2008
Weighted Average
Weighted Average
Weighted Average
Balance
Percent
Ratio
Balance
Percent
Ratio
Balance
Percent
Ratio
(Dollars in thousands)
$
106,968
8.82
%
0.75
%
$
88,759
7.87
%
0.90
%
$
73,949
10.58
%
0.89
%
271,583
22.44
1.43
199,965
17.73
2.07
57,117
8.17
2.92
146,442
12.10
0.79
147,669
13.10
1.04
149,062
21.33
1.35
685,514
56.64
2.32
691,237
61.30
2.84
418,804
59.92
3.84
$
1,210,507
100.00
%
1.80
%
$
1,127,630
100.00
%
2.32
%
$
698,932
100.00
%
2.92
%
At June 30,
2007
Balance
Percent
Weighted Average
Rate
(Dollars in thousands)
$
75,510
10.85
%
1.12
%
41,029
5.90
4.00
156,670
22.52
1.56
422,548
60.73
4.75
$
695,757
100.00
%
3.59
%
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At
December 31, 2009
(In thousands)
$
99,723
58,214
46,990
32,688
2,730
$
240,345
At December 31,
At or For the Years Ended June 30,
2009
2009
2008
2007
(Dollars in thousands)
$
507,439
$
508,991
$
433,672
$
196,661
$
508,145
$
505,599
$
310,231
$
210,598
$
508,708
$
544,238
$
433,672
$
233,797
3.96
%
3.96
%
4.00
%
4.17
%
4.13
%
4.00
%
4.30
%
4.34
%
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For the Six Months Ended December 31, 2009
Book
Book Value at
Profit/
Distributions
Additional
Value at
Property Name
June 30, 2009
(Loss)
Received
Investment
December 31, 2009
$
(428
)
$
184
$
(185
)
$
$
(429
)
(439
)
23
(16
)
(432
)
(228
)
46
(25
)
(207
)
(334
)
37
(45
)
(342
)
869
151
(127
)
894
328
266
328
140
3
$
1,337
$
420
$
(127
)
$
$
1,222
$
(1,429
)
$
390
$
(271
)
$
$
(1,410
)
$
(203
)
$
55
$
(24
)
$
$
(172
)
(23
)
33
(40
)
(30
)
141
(6
)
(8
)
127
3,329
375
(681
)
3,023
554
1
(32
)
523
167
30
(27
)
170
18
85
(100
)
3
436
(17
)
419
579
26
605
443
10
453
16
387
403
118
(6
)
114
$
5,767
$
435
$
(753
)
$
387
$
5,836
$
(208
)
$
173
$
(164
)
$
$
(199
)
(1)
The book values for wholly owned properties represent the costs of the fixed assets
associated with the property, less accumulated depreciation.
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(1)
real estate mortgages;
(2)
consumer and commercial loans;
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(3)
specific types of debt securities, including certain corporate debt securities
and obligations of federal, state and local governments and agencies;
(4)
certain types of corporate equity securities; and
(5)
certain other assets.
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common stockholders equity, excluding the unrealized appreciation or
depreciation, net of tax, from available for sale securities;
non-cumulative perpetual preferred stock, including any related retained
earnings; and
minority interests in consolidated subsidiaries minus all intangible assets,
other than qualifying servicing rights and any net unrealized loss on marketable
equity securities.
cumulative perpetual preferred stock;
certain perpetual preferred stock for which the dividend rate may be reset
periodically;
hybrid capital instruments, including mandatory convertible securities;
term subordinated debt;
intermediate term preferred stock;
allowance for loan losses; and
up to 45% of pretax net unrealized holding gains on available for sale equity
securities with readily determinable fair market values.
the quality of the banks interest rate risk management process;
the overall financial condition of the bank; and
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the level of other risks at the bank for which capital is needed.
As of December 31, 2009
Capital
Percent of Assets
(1)
(Dollars in thousands)
$
193,183
9.76
%
193,183
13.49
211,236
14.75
(1)
For purposes of calculating Core capital, assets
are based on adjusted total leverage assets. In calculating Tier 1
risk-based capital and total risk-based capital, assets are based on
total risk-weighted assets.
its ratio of total capital to risk-weighted assets is at least 10% ;
its ratio of Tier 1 capital to risk-weighted assets is at least 6%; and
its ratio of Tier 1 capital to total assets is at least 5%, and it is not
subject to any order or directive by the FDIC to meet a specific capital level.
its ratio of total capital to risk-weighted assets is at least 8%; or
its ratio of Tier 1 capital to risk-weighted assets is at least 4%; and
its ratio of Tier 1 capital to total assets is at least 4% (3% if the bank
receives the highest rating under the Uniform Financial Institutions Rating System)
and it is not a well-capitalized institution.
its total risk-based capital is less than 8%; or
its Tier 1 risk-based-capital is less than 4%; and
its leverage ratio is less than 4% (or less than 3% if the institution receives
the highest rating under the Uniform Financial Institutions Rating System).
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its total risk-based capital is less than 6%;
its Tier 1 capital is less than 3%; or
its leverage ratio is less than 3%.
insolvency, or when the assets of the bank are less than its liabilities to
depositors and others;
substantial dissipation of assets or earnings through violations of law or
unsafe or unsound practices;
existence of an unsafe or unsound condition to transact business;
likelihood that the bank will be unable to meet the demands of its depositors or
to pay its obligations in the normal course of business; and
insufficient capital, or the incurring or likely incurring of losses that will
deplete substantially all of the institutions capital with no reasonable prospect
of replenishment of capital without federal assistance.
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limits the extent to which the bank or its subsidiaries may engage in covered
transactions with any one affiliate to an amount equal to 10.0% of such banks
capital stock and retained earnings, and limits all such transactions with all
affiliates to an amount equal to 20% of such capital stock and retained earnings;
and
requires that all such transactions be on terms that are consistent with safe
and sound banking practices.
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a lending test, to evaluate the institutions record of making loans in its
service areas;
an investment test, to evaluate the institutions record of investing in
community development projects, affordable housing, and programs benefiting low or
moderate income individuals and businesses; and
a service test, to evaluate the institutions delivery of services through its
branches, ATMs and other offices.
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Truth-In-Lending Act, governing disclosures of credit terms to consumer
borrowers;
Home Mortgage Disclosure Act of 1975, requiring financial institutions to
provide information to enable the public and public officials to determine whether
a financial institution is fulfilling its obligation to help meet the housing needs
of the community it serves;
Equal Credit Opportunity Act, prohibiting discrimination on the basis of race,
creed or other prohibited factors in extending credit;
Fair Credit Reporting Act of 1978, governing the use and provision of
information to credit reporting agencies;
Fair Debt Collection Act, governing the manner in which consumer debts may be
collected by collection agencies; and
Rules and regulations of the various federal agencies charged with the
responsibility of implementing such federal laws.
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The operations of Oritani Bank also are subject to the:
Right to Financial Privacy Act, which imposes a duty to maintain confidentiality
of consumer financial records and prescribes procedures for complying with
administrative subpoenas of financial records;
Electronic Funds Transfer Act and Regulation E promulgated thereunder, which
govern automatic deposits to and withdrawals from deposit accounts and customers
rights and liabilities arising from the use of automated teller machines and other
electronic banking services;
Check Clearing for the 21
st
Century Act (also known as Check 21),
which gives substitute checks, such as digital check images and copies made from
that image, the same legal standing as the original paper check;
Title III of The Uniting and Strengthening America by Providing Appropriate
Tools Required to Intercept and Obstruct Terrorism Act of 2001 (referred to as the
USA PATRIOT Act), which significantly expanded the responsibilities of financial
institutions, including savings banks, in preventing the use of the U.S. financial
system to fund terrorist activities. Among other provisions, the USA PATRIOT Act
and the related regulations of the OTS require savings associations operating in
the United States to develop new anti-money laundering compliance programs, due
diligence policies and controls to ensure the detection and reporting of money
laundering. Such required compliance programs are intended to supplement existing
compliance requirements, also applicable to financial institutions, under the Bank
Secrecy Act and the Office of Foreign Assets Control Regulations; and
The Gramm-Leach-Bliley Act, which placed limitations on the sharing of consumer
financial information by financial institutions with unaffiliated third parties.
Specifically, the Gramm-Leach-Bliley Act requires all financial institutions
offering financial products or services to retail customers to provide such
customers with the financial institutions privacy policy and provide such
customers the opportunity to opt out of the sharing of certain personal financial
information with unaffiliated third parties.
(i)
investing in the stock of a savings bank;
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(ii)
acquiring a mutual association through the merger of such
association into a savings bank subsidiary of such holding company or an
interim savings bank subsidiary of such holding company;
(iii)
merging with or acquiring another holding company, one of
whose subsidiaries is a savings bank;
(iv)
investing in a corporation, the capital stock of which is
available for purchase by a savings bank under federal law or under the law of
any state where the subsidiary savings bank or associations share their home
offices;
(v)
furnishing or performing management services for a savings bank
subsidiary of such company;
(vi)
holding, managing or liquidating assets owned or acquired from
a savings subsidiary of such company;
(vii)
holding or managing properties used or occupied by a savings
bank subsidiary of such company;
(viii)
acting as trustee under deeds of trust;
(ix)
any other activity:
A.
that the Federal Reserve Board, by regulation, has determined to be
permissible for bank holding companies under Section 4(c) of the Bank
Holding Company Act of 1956, unless the Director, by regulation, prohibits
or limits any such activity for savings and loan holding companies; or
B.
in which multiple savings and loan holding companies were authorized (by
regulation) to directly engage on March 5, 1987;
(x)
any activity permissible for financial holding companies under
Section 4(k) of the Bank Holding Company Act, including securities and
insurance underwriting; and
(xi)
purchasing, holding, or disposing of stock acquired in
connection with a qualified stock issuance if the purchase of such stock by
such savings and loan holding company is approved by the Director. If a mutual
holding company acquires or merges with another holding company, the holding
company acquired or the holding company resulting from such merger or
acquisition may only invest in assets and engage in activities listed in (i)
through (x) above, and has a period of two years to cease any nonconforming
activities and divest any nonconforming investments.
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(i)
the approval of interstate supervisory acquisitions by savings and loan holding companies;
and
(ii)
the acquisition of a savings institution in another state if the laws of the
state of the target savings institution specifically permit such acquisitions.
(i)
the waiver would not be detrimental to the safe and sound operation of the
subsidiary savings association; and
(ii)
the mutual holding companys Board of Directors determines that such waiver is
consistent with such directors fiduciary duties to the mutual holding companys
members.
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Name
Positions Held
President and Chief Executive Officer
Executive Vice President and Chief Operating Officer
Executive Vice President and Chief Financial Officer
Executive Vice President and Chief Lending Officer
Senior Vice President and Corporate Secretary
*
Less than 1%.
(1)
Unless otherwise indicated, each person effectively exercises sole, or shared with spouse,
voting and dispositive power as to the shares reported. Totals include unvested stock awards
that were granted pursuant to the 2007 Equity Incentive Plan. The totals for Messrs. Skelly
and Hekemian include 50,000 shares and 16,241 shares, respectively, owned through a company in
which each individual has a beneficial ownership.
(2)
Includes 38,724 shares of common stock allocated to the accounts of executive officers under
the Oritani Bank Employee Stock Ownership Plan.
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Preside at executive session of the non-management directors.
Facilitate communications between other members of the Board of Directors and
the Chief Executive Officer. Any director is free to communicate directly with the
Chief Executive Officer. The Lead Directors role is to attempt to improve such
communications if they are not entirely satisfactory.
Work with the Chief Executive Officer in the preparation of the Board of
Directors meeting agenda and information to be provided to the Board of Directors.
Chair the annual review of the performance of the Chief Executive Officer.
Otherwise consult with the Chief Executive Officer on matters relating to
corporate governance and board performance.
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OceanFirst Financial Corp.
Partners Trust Financial
PennFed Financial Services, Inc.
Provident Financial Services, Inc.
Provident New York
Roma Financial Corp.
Synergy Financial Corp.
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Base Salary
Increase Date
Increase
% Increase
New Base Salary
$
500,000
11/10/08
$
45,000
9.00
%
$
545,000
$
250,000
11/10/08
$
22,500
9.00
%
$
272,500
$
200,000
11/10/08
$
18,000
9.00
%
$
218,000
$
200,000
11/10/08
$
18,000
9.00
%
$
218,000
$
189,000
n/a
$
n/a
$
189,000
Roma Bank
Northfield Bank
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A multi-employer defined benefit plan (a qualified plan). The plan was frozen as of
December 31, 2008. All employees who attained the age of 21 and completed one year of
service were eligible to participate in the plan.
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A nonqualified savings incentive plan covering employees whose salary deferrals to the
savings incentive plan are limited.
A nonqualified Benefit Equalization Plan which provides benefits to employees who are
disallowed certain benefits under our qualified benefit plans.
A nonqualified Post Retirement Medical Plan for directors and certain eligible
employees.
A nonqualified Executive Supplemental Retirement Income Agreement for our President and
Chief Executive Officer.
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Change in pension
value and
non-qualified
deferred
All other
Option Awards ($)
compensation
compensation ($)
Name and principal position
Fiscal Year
Salary ($)(1)
Bonus ($)
Stock Awards ($)(2)
(3)
earnings ($) (4)
(5)
Total ($)
2009
550,750
250,000
621,949
273,419
1,648,874
110,512
3,455,504
2008
530,769
250,000
103,658
45,570
919,491
111,241
1,960,730
2007
494,327
200,000
702,360
63,356
1,460,043
2009
263,846
65,625
298,536
123,038
87,278
25,995
864,318
2008
57,692
49,756
20,506
22,884
8,312
159,150
2009
211,077
70,000
298,536
123,038
73,436
76,249
852,336
2008
196,192
56,700
49,756
20,506
19,149
77,649
419,952
2007
189,627
59,150
18,414
28,645
295,836
2009
211,077
80,000
298,536
123,038
115,092
77,776
905,519
2008
188,923
58,800
49,756
20,506
39,735
80,826
438,546
2007
163,817
53,200
29,336
29,520
275,873
2009
191,181
37,800
46,950
18,228
192,800
76,239
563,198
2008
192,635
47,250
7,825
3,038
60,577
78,649
389,973
2007
187,270
46,000
64,599
28,098
325,967
(1)
Includes $23,058 and $2,181 of payments made in 2009 to Messrs. Lynch and Wyks, respectively,
for unused vacation days.
(2)
The amounts in this column reflect the dollar amount recognized for financial statement
reporting purposes for the fiscal years ended June 30, 2009 and 2008, in accordance with SFAS
123(R) and its successor, FASB ASC Topic 718, of restricted stock awards pursuant to the
Equity Plan. Assumptions used in the calculation of this amount are included in footnote 14 to
Oritani Financial Corp.s audited financial statements for the fiscal year ended June 30, 2009
included herein.
(3)
The amounts in this column reflect the dollar amount recognized for financial statement
reporting purposes, for the fiscal years ended June 30, 2009 and 2008, in accordance with SFAS
123(R) and its successor, FASB ASC Topic 718, of stock option awards pursuant to the Equity
Plan. Assumptions used in the calculation of this amount are included in footnote 14 to
Oritani Financial Corp.s audited financial statements for the fiscal year ended June 30, 2009
included herein.
(4)
The amounts in this column reflect the actuarial increase in the present value at June 30,
2009 compared to June 30, 2008, of the named executive officers benefits under the Defined
Benefit Plan and Benefit Equalization Plan and, in the case of Mr. Lynch, an Executive
Supplement Retirement Income Agreement and the Directors Retirement Plan maintained by
Oritani Bank, and, in the case of Mr. DeBernardi, the Directors Retirement Plan maintained by
Oritani Bank, determined using interest rate and mortality rate assumptions consistent with
those used in Oritani Financial Corp.s financial statements and includes amounts for which
the named executive officer may not currently be entitled to receive because such amounts are
not vested. This column also includes $69,874, $73, $7,435, $2,091, and $5,799 of
preferential or above-market earnings on non tax-qualified deferred compensation for
non-qualified defined contribution plans for Messrs. Lynch, DeBernardi, Fields, Guinan and
Wyks, respectively, as well as $21,025 for Mr. DeBernardi of preferential earnings on a
similar plan for deferred director fees.
(5)
The amounts in this column represent the total of all perquisites (non-cash benefits and
perquisites such as the use of employer-owned automobiles, membership dues and other personal
benefits), employee benefits (employer cost of life insurance and health insurance), and
employer contributions to defined contribution plans (the 401(k) Plan, the ESOP and the
Benefit Equalization Plan). Amounts are reported separately under the All Other
Compensation table below.
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Company
Contribution on
Company
Medical, Dental,
Contribution to
Benefit
Disability and
ESOP and 401(k)
Equalization Plan
Insurance Benefits
Automobile
Plan Match
Match Contribution
Country Club Dues
Name
Fiscal Year
($)
Allowance ($)
Contribution ($)
($)
($)
Total ($)
2009
16,846
16,521
48,430
20,561
8,154
110,512
2008
19,885
13,073
48,480
23,423
6,380
111,241
2007
20,037
15,844
3,462
17,368
6,645
63,356
2009
14,803
9,305
1,887
25,995
2008
8,312
8,312
2009
13,228
9,620
47,969
5,432
76,249
2008
12,102
9,581
48,815
7,151
77,649
2007
11,042
10,140
3,615
3,848
28,645
2009
12,168
7,469
48,527
5,001
4,611
77,776
2008
11,079
7,458
53,612
2,299
6,377
80,826
2007
10,078
6,315
6,511
6,615
29,520
2009
16,879
7,522
49,767
2,072
76,239
2008
15,999
7,438
50,414
4,798
78,649
2007
14,515
6,585
6,998
28,098
Estimated Possible Payouts Under
Non-Equity Incentive Plan Awards (1)
Threshold
Target
Maximum
Name
($)
($)
($)
136,250
272,500
408,750
59,950
109,00
133,525
47,960
87,200
106,820
47,960
87,200
106,820
30,712
37,800
47,250
(1)
Assumes full achievement of individual component of award total.
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OUTSTANDING EQUITY AWARDS AT JUNE 30, 2009
Option Awards
Stock Awards
Number of
Number of
Market Value of
Securities
Securities
Shares or Units of
Underlying
Underlying
Number of Shares or
Stock That Have Not
Unexercised Options
Unexercised Options
Option Exercise
Option Expiration
Units of Stock That
Vested ($)
Name
(#) Exercisable
(#) Unexercisable
Price ($)
Date
(1)
Have Not Vested (#)
(2)
79,482
317,929
15.65
05/05/18
158,965
2,179,410
35,767
143,068
15.65
05/05/18
76,303
1,046,114
35,767
143,068
15.65
05/05/18
76,303
1,046,114
35,767
143,068
15.65
05/05/18
76,303
1,046,114
5,299
21,195
15.65
05/05/18
12,000
164,520
(1)
Stock options expire 10 years after the grant date.
(2)
This amount is based on the per share fair market value of Oritani Financial Corp.s common
stock on June 30, 2009 of $13.71.
Pension Benefits at and for the Fiscal Year Ended June 30, 2009
Number of Years
Present Value of
Payments During
Credited Service
Accumulated Benefit
Last Fiscal Year
Name
Plan Name
(#)
($)
(1)
($)
Defined Benefit Plan
15.50
531,000
Directors Retirement Plan
18.67
407,000
Benefit Equalization Plan
15.50
1,473,000
Executive Supplemental Income Agreement
4.50
2,314,000
Defined Benefit Plan
Benefit Equalization Plan
Directors Retirement Plan
15.67
170,000
Defined Benefit Plan
10.67
128,000
Benefit Equalization Plan
10.67
27,000
Defined Benefit Plan
21.17
303,000
Benefit Equalization Plan
5.50
8,000
Defined Benefit Plan
32.50
701,000
Benefit Equalization Plan
32.50
83,000
(1)
The figures shown are determined as of the plans measurement date of
June 30, 2009 for purposes of Oritani Financial Corp.s audited
financial statements. For mortality, discount rate and other
assumptions used for this purpose, please refer to note 13 in the
audited financial statements included herein.
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Nonqualified Deferred Compensation at and for the Fiscal Year Ended June 30, 2009
Registrant
Executive
Contributions in
Aggregate Earnings
Aggregate
Aggregate Balance at
Contributions in
Last Fiscal
in Last Fiscal
Withdrawals/
Last Fiscal Year End
Name
Last Fiscal Year
Year
(1)
Year
(2)
Distributions($)
($)
127,199
20,561
106,093
1,318,161
12,632
1,887
144
14,662
33,312
5,432
15,470
199,995
26,042
5,001
4,237
61,518
12,196
2,072
12,108
147,209
(1)
The amounts reported in this column were also reported as compensation under All Other
Compensation in the Summary Compensation Table.
(2)
For Messrs. Lynch, DeBernardi, Fields, Guinan and Wyks, $69,874, $73, $7,436, $2,092 and
$5,800 respectively, were reported as preferential or above-market earnings for each
individual under Change in pension value and non-qualified deferred compensation earnings in
the Summary Compensation Table.
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Involuntary Termination after Change
Involuntary Termination
in Control
Retirement
Disability
Death
$
2,435,537
(1)
$
1,037,789
(2)
$
(3)
$
1,314,719
(4)
$
1,303,546
(5)
$
1,966,900
(6)
$
2,314,000
(6)
$
2,314,000
(6)
$
1,966,900
(6)
$
1,966,900
(6)
$
1,473,000
(7)
$
1,473,000
(7)
$
1,473,000
(7)
$
1,473,000
(7)
$
1,473,000
(7)
$
407,000
(8)
$
407,000
(8)
$
407,000
(8)
$
407,000
(8)
$
407,000
(8)
$
(9)
$
2,179,410
(9)
$
(9)
$
2,179,410
(9)
$
2,179,410
(9)
$
705,857
(10)
$
(11)
$
(12)
$
384,986
(13)
$
382,801
(14)
$
(15)
$
(15)
$
(15)
$
(15)
$
(15)
$
(16)
$
170,000
(16)
$
(16)
$
(16)
$
(16)
$
(17)
$
1,046,114
(17)
$
(17)
$
1,046,114
(17)
$
1,046,114
(17)
$
602,455
(18)
$
306,669
(19)
$
(20)
$
309,845
(21)
$
308,295
(22)
$
27,000
(23)
$
27,000
(23)
$
27,000
(23)
$
27,000
(23)
$
27,000
(23)
$
(24)
$
1,046,114
(24)
$
(24)
$
1,046,114
(24)
$
1,046,114
(24)
$
620,336
(25)
$
272,881
(26)
$
(27)
$
308,425
(28)
$
306,875
(29)
$
8,000
(30)
$
8,000
(30)
$
8,000
(30)
$
8,000
(30)
$
8,000
(30)
$
(31)
$
1,046,114
(31)
$
(31)
$
1,046,114
(31)
$
1,046,114
(31)
$
487,358
(32)
$
487,358
(33)
$
(34)
$
275,878
(35)
$
274,427
(36)
$
83,000
(37)
$
83,000
(37)
$
83,000
(37)
$
83,000
(37)
$
83,000
(37)
$
(38)
$
164,520
(38)
$
(38)
$
164,520
(38)
$
164,520
(38)
(1)
This amount represents 3 times the sum of (i) Mr. Lynchs highest base salary plus (ii)
highest bonus, and (iii) Oritani Bank contributions to continued life, medical, dental and
disability insurance for 36 months following termination of employment.
(2)
This amount represents the maximum severance payments and other benefits to Mr. Lynch under
his employment agreement without incurring an excess parachute payment under Code Section
280G. Severance payments and other benefits provided to Mr. Lynch as a result of the change
in control are reduced by $1,397,749 in order to avoid an excess parachute payment.
(3)
Mr. Lynch is entitled to no payments or benefits under his employment agreement as a result
of his retirement.
(footnotes continued on next
page)
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(4)
In the event of his disability, Mr. Lynch would receive his base salary and continued health
care coverage for the longer of the remaining term of his employment agreement, or one year,
less amounts payable under any disability programs. This amount represents Mr. Lynchs base
salary and continued life, medical, dental and disability insurance for the remaining term of
the agreement, without any reduction for payments under bank sponsored disability programs.
(5)
In the event of his death, Mr. Lynchs beneficiary would be entitled to receive Mr. Lynchs
base salary and medical, dental, family and other benefits for the remaining term of the
employment agreement.
(6)
This amount represents the present value of Mr. Lynchs accumulated benefit under his
Executive Supplemental Retirement Income Agreement. Under his Executive Supplemental
Retirement Income Agreement, Mr. Lynch is entitled to receive an annual supplemental
retirement benefit commencing at age 65 equal to 70% of his highest annual base salary and
bonus over the consecutive 36 month period within the last 120 consecutive calendar months of
employment, reduced by the sum of (i) the annuitized value of his benefits under the banks
pension plan, (ii) the annuitized value of his benefits under the defined benefit portion of
the Banks Benefit Equalization Plan, and (iii) the annuitized value of one-half of his Social
Security benefits attributable to taxes paid by the bank on his behalf. Upon a change in
control, Mr. Lynch is entitled to the full supplemental retirement income benefit as if he
worked through age 65. In the event of Mr. Lynchs death, disability, or termination prior to
reaching age 65, Mr. Lynch is entitled to his early retirement benefit equal to 85% of his
supplemental retirement benefit. Mr. Lynch is fully vested in his early retirement benefit.
(7)
Following Mr. Lynchs separation from service for any reason, he will be entitled to receive
his accrued benefit under the Benefit Equalization Plan as of his date of termination.
(8)
This amount represents the present value of Mr. Lynchs accumulated benefit under the 2005
Directors Retirement Plan. Under the 2005 Director s Retirement Plan, Mr. Lynch is entitled
to receive an annual retirement benefit equal to 50% of the aggregate compensation paid to him
during the year of his retirement. Mr. Lynch is currently 100% vested in his annual
retirement benefit under the plan, and his benefits under the plan will commence following his
date of termination.
(9)
This amount represents the fair market value of the outstanding equity awards that become
exercisable as a result of Mr. Lynchs involuntary termination after a change in control,
disability, or death. In the event of Mr. Lynchs involuntary termination or retirement, his
unvested outstanding equity awards would be forfeited.
(10)
This amount represents 2 times the sum of (i) Mr. DeBernardis highest base salary plus (ii)
highest bonus, and (iii) Bank contributions to continued life, medical, dental and disability
insurance for 24 months following termination of employment.
(11)
This amount represents the maximum severance payments and other benefits to Mr. DeBernardi
under his employment agreement without incurring an excess parachute payment under Code
Section 280G. Severance payments and other benefits provided to Mr. DeBernardi as a result of
the change in control are reduced by $705,857 in order to avoid an excess parachute payment.
(12)
Mr. DeBernardi is entitled to no payments or benefits under his employment agreement as a
result of his retirement.
(13)
In the event of his disability, Mr. DeBernardi would receive his base salary and continued
health care coverage for the longer of the remaining term of his employment agreement, or one
year, less amounts payable under any disability programs. This amount represents Mr.
DeBernardis base salary and continued life, medical, dental and disability insurance for the
remaining term of the agreement, without any reduction for payments under Bank sponsored
disability programs.
(14)
In the event of his death, Mr. DeBernardis beneficiary would be entitled to receive Mr.
DeBernardis base salary and medical, dental, family and other benefits for the remaining term
of the employment agreement.
(15)
Mr. DeBernardi has not accumulated any benefits under the Benefit Equalization Plan.
(16)
Under the 2005 Director s Retirement Plan, Mr. DeBernardi is entitled to receive an annual
retirement benefit equal to 50% of the aggregate compensation paid to Mr. DeBernardi during
the year of his retirement. Mr. DeBernardi is not currently vested in his annual retirement
benefit under the plan, which will occur when Mr. DeBernardi attains age 65. Upon a change in
control, Mr. DeBernardi will be entitled to receive his annual retirement benefit regardless
of his actual age.
(17)
This amount represents the fair market value of the outstanding equity awards that become
exercisable as a result of Mr. DeBernardis involuntary termination after a change in control,
disability, or death. In the event of Mr. DeBernardis involuntary termination or retirement,
his unvested outstanding equity awards would be forfeited.
(18)
This amount represents 2 times the sum of (i) Mr. Fields highest base salary plus (ii)
highest bonus, and (iii) Bank contributions to continued life, medical, dental and disability
insurance for 24 months following termination of employment.
(19)
This amount represents the maximum severance payments and other benefits to Mr. Fields under
his employment agreement without incurring an excess parachute payment under Code Section
280G. Severance payments and other benefits to Mr. Fields as a result of the change in
control are reduced by $295,786 in order to avoid an excess parachute payment.
(20)
Mr. Fields is entitled to no payments or benefits under his employment agreement as a result
of his retirement.
(21)
In the event of his disability, Mr. Fields would receive his base salary and continued health
care coverage for the longer of the remaining term of his employment agreement, or one year,
less amounts payable under any disability programs. This amount represents Mr. Fields base
salary and continued life, medical, dental and disability insurance for the remaining term of
the agreement, without any reduction for payments under Bank sponsored disability programs.
(22)
In the event of his death, Mr. Fields beneficiary would be entitled to receive Mr. Fields
base salary and medical, dental, family and other benefits for the remaining term of the
employment agreement.
(23)
Following Mr. Fields separation from service for any reason, he will be entitled to receive
his accrued benefit under the Benefit Equalization Plan as of his date of termination.
(24)
This amount represents the fair market value of the outstanding equity awards that become
exercisable as a result of Mr. Fields involuntary termination after a change in control,
disability, or death. In the event of Mr. Fields involuntary termination or retirement, his
unvested outstanding equity awards would be forfeited.
(25)
This amount represents 2 times the sum of (i) Mr. Guinans highest base salary plus (ii)
highest bonus, and (iii) Bank contributions to continued life, medical, dental and disability
insurance for 24 months following termination of employment.
(26)
This amount represents the maximum severance payments and other benefits to Mr. Guinan under
his employment agreement without incurring an excess parachute payment under Code Section
280G. Severance payments and other benefits to Mr. Guinan as a result of the change in
control are reduced by $347,455 in order to avoid an excess parachute payment.
(27)
Mr. Guinan is entitled to no payments or benefits under his employment agreement as a result
of his retirement.
(28)
In the event of his disability, Mr. Guinan would receive his base salary and continued health
care coverage for the longer of the remaining term of his employment agreement, or one year,
less amounts payable under any disability programs. This amount represents Mr. Guinans base
salary and continued
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life, medical, dental and disability insurance for the remaining term of the agreement, without any
reduction for payments under Bank sponsored disability programs.
(29)
In the event of his death, Mr. Guinan beneficiary would be entitled to receive Mr. Guinans
base salary and medical, dental, family and other benefits for the remaining term of the
employment agreement.
(30)
Following Mr. Guinans separation from service for any reason, he will be entitled to receive
his accrued benefit under the Benefit Equalization Plan as of his date of termination.
(31)
This amount represents the fair market value of the outstanding equity awards that become
exercisable as a result of Mr. Guinans involuntary termination after a change in control,
disability, or death. In the event of Mr. Guinans involuntary termination or retirement, his
unvested outstanding equity awards would be forfeited.
(32)
This amount represents 2 times the sum of (i) Mr. Wyks highest base salary plus (ii) highest
bonus, and (iii) Bank contributions to continued life, medical, dental and disability
insurance for 24 months following termination of employment.
(33)
This amount represents 2 times the sum of (i) Mr. Wyks highest base salary plus (ii) highest
bonus, and (iii) Bank contributions to continued life, medical, dental and disability
insurance for 24 months following his termination of employment in connection with a change in
control.
(34)
Mr. Wyks is entitled to no payments or benefits under his employment agreement as a result of
his retirement.
(35)
In the event of his disability, Mr. Wyks would receive his base salary and continued health
care coverage for the longer of the remaining term of his employment agreement, or one year,
less amounts payable under any disability programs. This amount represents Mr. Wykss base
salary and continued life, medical, dental and disability insurance for the remaining term of
the agreement, without any reduction for payments under Bank sponsored disability programs.
(36)
In the event of his death, Mr. Wyks beneficiary would be entitled to receive Mr. Wykss base
salary and medical, dental, family and other benefits for the remaining term of the employment
agreement.
(37)
Following Mr. Wykss separation from service for any reason, he will be entitled to receive
his accrued benefit under the Benefit Equalization Plan as of his date of termination.
(38)
This amount represents the fair market value of the outstanding equity awards that become
exercisable as a result of Mr. Wykss involuntary termination after a change in control,
disability, or death. In the event of Mr. Wykss involuntary termination or retirement, his
unvested outstanding equity awards would be forfeited.
Change in Pension
Value and
Nonqualified
Fees Earned or Paid
Deferred
in Cash
Compensation
Name
($)
Stock Awards ($) (1)
Option Awards ($) (2)
Earnings ($) (3)
Total ($)
98,750
161,707
82,026
170,775
513,257
88,750
161,707
82,026
132,554
465,036
88,750
161,707
82,026
55,885
388,377
88,750
161,707
82,026
134,522
467,005
(1)
The amounts in this column reflect the dollar amount recognized for financial
statement reporting purposes for the fiscal year ended June 30, 2009, in accordance with FAS
123(R) and its successor, FASB ASC Topic 718, of restricted stock awards pursuant to the
Equity Plan that were made in 2008, which vest over five years. Assumptions used in the
calculation of these amounts are included in footnote 14 to Oritani Financial Corp.s audited
financial statements for the fiscal year ended June 30, 2009 included in Oritani Financial
Corp.s Annual Report on Form 10-K.
(2)
The amounts in this column reflect the dollar amount recognized for financial
statement reporting purposes for the fiscal year ended June 30, 2009, in accordance with FAS
123(R) and its successor, FASB ASC Topic 718, of stock option awards pursuant to the Equity
Plan that were made in 2008. Stock options vest over five years. Assumptions used in the
calculation of these amounts are included in footnote 14 to Oritani Financial Corp.s audited
financial statements for the fiscal year ended June 30, 2009 included in Oritani Financial
Corp.s Annual Report on Form 10-K.
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(3)
The amounts in this column reflect the actuarial increase in the present value at
June 30, 2009 compared to June 30, 2008, of the directors benefits under the Directors
Retirement Plan maintained by Oritani Bank, determined using interest rate and mortality rate
assumptions consistent with those used in Oritani Financial Corp.s financial statements and
include amounts for which the director may not currently be entitled to receive because such
amounts are not vested. Also includes $32,775, $31,554, $22,895 and $22,522 of preferential
or above-market earnings on non tax-qualified deferred compensation for Directors Antonaccio,
Doyle, Hekemian and Skelly, respectively, under the Directors Deferred Fee Plan.
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non-employee directors in the aggregate may not receive more than 30% of
the options and restricted stock awards authorized under the plan;
any one non-employee director may not receive more than 5% of the options
and restricted stock awards authorized under the plan;
any officer or employee may not receive more than 25% of the options and
restricted stock awards authorized under the plan;
any tax-qualified employee stock benefit plans and management stock award
plans, in the aggregate, may not hold more than 10.0% of the shares sold in the
offering, unless Oritani Bank has tangible capital of 10.0% or more, in which case any
tax-qualified employee stock benefit plans and management stock award plans, may be
increased to up to 12% of the shares sold in the offering;
stock options and restricted stock awards may not vest more rapidly than
20% per year, beginning on the first anniversary of the grant;
accelerated vesting is not permitted except for death, disability or upon
a change in control of Oritani Bank or Oritani; and
our executive officers or directors must exercise or forfeit their options
in the event that Oritani Bank becomes critically undercapitalized, is subject to
enforcement action or receives a capital directive.
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Amount of Shares
Owned and Nature
Percent of Shares
Name and Address of
of Beneficial
of Common Stock
Beneficial Owners
Ownership (1)
Outstanding
74.4
%
370 Pascack Road
Township of Washington, New Jersey 07676
and all directors and executive
officers of Oritani Financial Corp.
and Oritani Bank as a group
(__ directors and officers) (2)
%
(1)
In accordance with Rule 13d-3 under the Securities Exchange Act of 1934, a person is deemed
to be the beneficial owner for purposes of this table, of any shares of common stock if he has
shared voting or investment power with respect to such security, or has a right to acquire
beneficial ownership at any time within 60 days from the date as of which beneficial ownership
is being determined. As used herein, voting power is the power to vote or direct the voting
of shares and investment power is the power to dispose or direct the disposition of shares,
and includes all shares held directly as well as by spouses and minor children, in trust and
other indirect ownership, over which shares the named individuals effectively exercise sole or
shared voting or investment power.
(2)
Includes shares of common stock held by Oritani Financial Corp., MHC, of which our directors
are also trustees. Excluding shares of common stock held by Oritani Financial Corp., MHC,
directors and executive officers of Oritani Financial Corp. and Oritani Bank owned 791,600
shares of common stock, or 1.6% of the outstanding shares.
Shares of Common
Options Exercisable
Name (1)
Stock Held (2)
Within 60 Days
Total
Nicholas Antonaccio
Michael A. DeBernardi
James J. Doyle, Jr.
Robert S. Hekemian, Jr.
Kevin J. Lynch
John J. Skelly, Jr.
John M. Fields
Thomas G. Guinan
Philip M. Wyks
*
Less than 1%.
(1)
The mailing address for each person listed is 370 Pascack Road, Township of Washington, New
Jersey 07676-2353.
(2)
In accordance with Rule 13d-3 under the Securities Exchange Act of 1934, a person is deemed
to be the beneficial owner for purposes of this table, of any shares of common stock if he has
shared voting or investment power with respect to such security, or has a right to acquire
beneficial ownership at any time within 60 days from the date as of which beneficial ownership
is being determined. As used herein, voting power is the power to vote or direct the voting
of shares and investment power is the power to dispose or direct the disposition of shares,
and includes all shares held directly as well as by spouses and minor children, in trust and
other indirect ownership, over which shares the named individuals effectively exercise sole or
shared voting or investment power.
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(i)
the number of exchange shares to be held upon consummation of the conversion,
based upon their beneficial ownership of Oritani Financial Corp. common stock as of
;
(ii)
the proposed purchases of subscription shares, assuming sufficient shares of
common stock are available to satisfy their subscriptions; and
(iii)
the total amount of Oritani common stock to be held upon consummation of the
conversion.
Proposed Purchases of Stock in the
Number of
Offering (1)
Total Common Stock to be Held
Exchange Shares to
Percentage of Total
Name of Beneficial Owner
be Held (2)
Number of Shares
Amount
Number of Shares
Outstanding (2)
$
$
%
$
$
%
$
%
*
Less than 1%.
(1)
Includes proposed subscriptions, if any, through the director or officers 401(k) account and
by associates.
(2)
Assumes an exchange ratio of
shares for each share of Oritani Financial Corp. and that
shares are outstanding after the conversion. Includes shares that may be acquired
upon the exercise of stock options.
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STOCKHOLDERS OF ORITANI FINANCIAL CORP.
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(i)
it does not involve an interim savings institution;
(ii)
Oritani Financial Corp.s federal stock charter is not changed;
(iii)
each share of Oritani Financial Corp.s stock outstanding immediately prior to
the effective date of the transaction will be an identical outstanding share or a
treasury share of Oritani Financial Corp. after such effective date; and
(iv)
either:
(a)
no shares of voting stock of Oritani Financial Corp. and no
securities convertible into such stock are to be issued or delivered under the
plan of combination; or
(b)
the authorized but unissued shares or the treasury shares of
voting stock of Oritani Financial Corp. to be issued or delivered under the
plan of combination, plus those initially issuable upon conversion of any
securities to be issued or delivered under such plan, do not exceed 15% of the
total shares of voting stock of Oritani Financial Corp. outstanding immediately
prior to the effective date of the transaction.
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the economic effect, both immediate and long-term, upon Oritanis stockholders,
including stockholders, if any, who do not participate in the transaction;
the social and economic effect on the present and future employees, creditors and
customers of, and others dealing with, Oritani and its subsidiaries and on the
communities in which Oritani and its subsidiaries operate or are located;
whether the proposal is acceptable based on the historical, current or projected
future operating results or financial condition of Oritani;
whether a more favorable price could be obtained for Oritanis stock or other
securities in the future;
the reputation and business practices of the other entity to be involved in the
transaction and its management and affiliates as they would affect the employees of
Oritani and its subsidiaries;
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the future value of the stock or any other securities of Oritani or the other entity
to be involved in the proposed transaction;
any antitrust or other legal and regulatory issues that are raised by the proposal;
the business and historical, current or expected future financial condition or
operating results of the other entity to be involved in the transaction, including, but
not limited to, debt service and other existing financial obligations, financial
obligations to be incurred in connection with the proposed transaction, and other
likely financial obligations of the other entity to be involved in the proposed
transaction; and
the ability of Oritani to fulfill its objectives as a financial institution holding
company and on the ability of its subsidiary financial institution(s) to fulfill the
objectives of a federally insured financial institution under applicable statutes and
regulations.
(i)
The limitation on voting rights of persons who directly or indirectly
beneficially own more than 10.0% of the outstanding shares of common stock;
(ii)
The division of the Board of Directors into three staggered classes;
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(iii)
The ability of the Board of Directors to fill vacancies on the board;
(iv)
The requirement that at least a majority of the votes eligible to be cast by
stockholders must vote to remove directors, and can only remove directors for cause;
(v)
The ability of the Board of Directors to amend and repeal the bylaws;
(vi)
The ability of the Board of Directors to evaluate a variety of factors in
evaluating offers to purchase or otherwise acquire Oritani;
(vii)
The authority of the Board of Directors to provide for the issuance of
preferred stock;
(viii)
The validity and effectiveness of any action lawfully authorized by the affirmative
vote of the holders of a majority of the total number of outstanding shares of common
stock;
(ix)
The number of stockholders constituting a quorum or required for stockholder
consent;
(x)
The indemnification of current and former directors and officers, as well as
employees and other agents, by Oritani;
(xi)
The limitation of liability of officers and directors to Oritani for money damages;
(xii)
The inability of stockholders to cumulate their votes in the election of directors;
(xiii)
The advance notice requirements for stockholder proposals and nominations; and
(xiv)
The provision of the certificate of incorporation requiring approval of at
least 80% of the outstanding voting stock to amend the provisions of the certificate of
incorporation provided in (i) through (xiii) of this list.
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the economic effect, both immediate and long-term, upon Oritanis stockholders,
including stockholders, if any, who do not participate in the transaction;
the social and economic effect on the present and future employees, creditors and
customers of, and others dealing with, Oritani and its subsidiaries and on the
communities in which Oritani and its subsidiaries operate or are located;
whether the proposal is acceptable based on the historical, current or projected
future operating results or financial condition of Oritani;
whether a more favorable price could be obtained for Oritanis stock or other
securities in the future;
the reputation and business practices of the other entity to be involved in the
transaction and its management and affiliates as they would affect the employees of
Oritani and its subsidiaries;
the future value of the stock or any other securities of Oritani or the other entity
to be involved in the proposed transaction;
any antitrust or other legal and regulatory issues that are raised by the proposal;
the business and historical, current or expected future financial condition or
operating results of the other entity to be involved in the transaction, including, but
not limited to, debt service and other existing financial obligations, financial
obligations to be incurred in connection with the proposed transaction, and other
likely financial obligations of the other entity to be involved in the proposed
transaction; and
the ability of Oritani to fulfill its objectives as a financial institution holding
company and on the ability of its subsidiary financial institution(s) to fulfill the
objectives of a federally insured financial institution under applicable statutes and
regulations.
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(i)
the acquisition would result in a monopoly or substantially lessen competition;
(ii)
the financial condition of the acquiring person might jeopardize the financial
stability of the institution; or
(iii)
the competence, experience or integrity of the acquiring person indicates that
it would not be in the interest of the depositors or the public to permit the
acquisition of control by such person.
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The consolidated financial statements of Oritani Financial Corp. and subsidiaries as of
June 30, 2009 and 2008, and for each of the years in the three-year period ended June 30, 2009,
have been included herein in reliance upon the report of KPMG LLP, independent registered public
accounting firm, which is included herein and upon the authority of said firm as experts in
accounting and auditing.
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PART II:
INFORMATION NOT REQUIRED IN PROSPECTUS
Item 13.
Other Expenses of Issuance and Distribution
Amount
*
$
500,000
*
325,000
*
17,315,040
*
155,000
*
150,000
*
51,000
*
140,000
*
200,000
*
76,400
*
75,000
*
35,000
*
50,000
$
19,072,440
*
Estimated
(1)
Oritani Financial Corp. has retained Stifel, Nicolaus & Company, Incorporated to assist in
the sale of common stock on a best efforts basis in the offerings, and to serve as records
management agent in connection with the conversion and offering. Fees are estimated at the
maximum, as adjusted, of the offering range.
Item 14.
Indemnification of Directors and Officers
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1.1
Engagement Letter between Oritani Financial Corp. and Oritani Financial Corp., MHC and Stifel,
Nicolaus & Company, Incorporated
1.2
Form of Agency Agreement between Oritani Financial Corp. and Stifel, Nicolaus & Company,
Incorporated
2
Oritani Financial Corp., MHC Plan of Conversion and Reorganization (Incorporated by reference
to Exhibit 2.1 to the Registrants Current Report on Form 8-K filed with the SEC on February
22, 2010).
3.1
Certificate of Incorporation of Oritani Financial Corp.
3.2
Bylaws of Oritani Financial Corp.
4
Form of Common Stock Certificate of Oritani Financial Corp.
5
Opinion of Luse Gorman Pomerenk & Schick regarding legality of securities being registered
8
Form of Federal Tax Opinion of Luse Gorman Pomerenk & Schick
10.1
Employment Agreement between Oritani Financial Corp. and Kevin J. Lynch**
10.2
Form of Employment Agreement between Oritani Financial Corp. and executive officers**
10.3
Oritani Bank Director Retirement Plan**
10.4
Oritani Bank Benefit Equalization Plan**
10.5
Oritani Bank Executive Supplemental Retirement Income Agreement**
10.6
Form of Employee Stock Ownership Plan**
10.7
Director Deferred Fee Plan**
10.8
Oritani Financial Corp. 2007 Equity Incentive Plan**
21
Subsidiaries of Registrant (Incorporated by reference to Exhibit 21 to the Registrants
Annual Report on Form 10-K filed with the SEC on September 11, 2009).
23.1
Consent of Luse Gorman Pomerenk & Schick, P.C. (contained in Opinions included as Exhibits 5 and 8)
23.2
Consent of KPMG LLP
23.3
Consent of RP Financial, LC.
24
Power of Attorney (set forth on signature page)
99.1
Appraisal Agreement between Oritani Bank and RP Financial, LC.
99.2
Business Plan Agreement by and among Oritani Bank, Oritani Financial Corp. and FinPro, Inc.
99.3
Appraisal Report of RP Financial, LC.***
99.4
Letter of RP Financial, LC. with respect to subscription rights
99.5
Letter of RP Financial, LC with respect to liquidation rights
99.6
Marketing Materials*
99.7
Order and Acknowledgment Form*
*
To be filed supplementally or by amendment.
**
Incorporated by reference to the Registration Statement on Form S-1 of Oritani Financial
Corp. (file no. 333-137309), originally filed with the Securities and Exchange Commission on
September 14, 2006.
***
Supporting financial schedules filed in paper format only pursuant to Rule 202 of Regulation
S-T. Available for inspection, during business hours, at the principal offices of the SEC in
Washington, D.C.
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Item 17.
Undertakings
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ORITANI FINANCIAL CORP.
By:
/s/ Kevin J. Lynch
Kevin J. Lynch
Chairman, President and Chief Executive Officer
(Duly Authorized Representative)
Signatures
Title
Date
/s/ Kevin J. Lynch
Chairman of the Board,
President
and Chief
Executive Officer
(Principal Executive
Officer)
March 5, 2010
/s/ John M. Fields
Executive Vice President
and
Chief Financial
Officer
(Principal
Financial and Accounting
Officer)
March 5, 2010
/s/ Michael A. DeBernardi
Director, Executive Vice
President and
Chief
Operating Officer
March 5, 2010
/s/ Nicholas Antonaccio
Director
March 5, 2010
/s/ James J. Doyle, Jr.
Director
March 5, 2010
/s/ Robert S. Hekemian, Jr.
Director
March 5, 2010
/s/ John J. Skelly, Jr.
Director
March 5, 2010
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TO
REGISTRATION STATEMENT
ON
FORM S-1
Township of Washington, New Jersey
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1.1
Engagement Letter between Oritani Financial Corp. and Oritani Financial Corp., MHC and Stifel,
Nicolaus & Company, Incorporated
1.2
Form of Agency Agreement between Oritani Financial Corp. and Stifel, Nicolaus & Company,
Incorporated
2
Oritani Financial Corp., MHC Plan of Conversion and Reorganization (Incorporated by reference
to Exhibit 2.1 to the Registrants Current Report on Form 8-K filed with the SEC on February
22, 2010).
3.1
Certificate of Incorporation of Oritani Financial Corp.
3.2
Bylaws of Oritani Financial Corp.
4
Form of Common Stock Certificate of Oritani Financial Corp.
5
Opinion of Luse Gorman Pomerenk & Schick regarding legality of securities being registered
8
Form of Federal Tax Opinion of Luse Gorman Pomerenk & Schick
10.1
Employment Agreement between Oritani Financial Corp. and Kevin J. Lynch**
10.2
Form of Employment Agreement between Oritani Financial Corp. and executive officers**
10.3
Oritani Bank Director Retirement Plan**
10.4
Oritani Bank Benefit Equalization Plan**
10.5
Oritani Bank Executive Supplemental Retirement Income Agreement**
10.6
Form of Employee Stock Ownership Plan**
10.7
Director Deferred Fee Plan**
10.8
Oritani Financial Corp. 2007 Equity Incentive Plan**
21
Subsidiaries of Registrant (Incorporated by reference to Exhibit 21 to the Registrants
Annual Report on Form 10-K filed with the SEC on September 11, 2009).
23.1
Consent of Luse Gorman Pomerenk & Schick, P.C. (contained in Opinions included as Exhibits 5 and 8)
23.2
Consent of KPMG LLP
23.3
Consent of RP Financial, LC.
24
Power of Attorney (set forth on signature page)
99.1
Appraisal Agreement between Oritani Bank and RP Financial, LC.
99.2
Business Plan Agreement by and among Oritani Bank, Oritani Financial Corp. and FinPro, Inc.
99.3
Appraisal Report of RP Financial, LC.***
99.4
Letter of RP Financial, LC. with respect to subscription rights
99.5
Letter of RP Financial, LC with respect to liquidation rights
99.6
Marketing Materials*
99.7
Order and Acknowledgment Form*
*
To be filed supplementally or by amendment.
**
Incorporated by reference to the Registration Statement on Form S-1 of Oritani Financial
Corp. (file no. 333-137309), originally filed with the Securities and Exchange Commission on
September 14, 2006.
***
Supporting financial schedules filed in paper format only pursuant to Rule 202 of Regulation
S-T. Available for inspection, during business hours, at the principal offices of the SEC in
Washington, D.C.
Re: Proposed Second Step Conversion Advisory, Administrative and Marketing Services |
| Advise with respect to business planning issues in preparation for a public offering; | ||
| Advise with respect to the choice of charter and form of organization; | ||
| Review and advise with respect to the Plan (e.g. sizes of benefit plan purchases; maximum purchase limits for investors); | ||
| Review and provide input with respect to the business plan to be prepared in connection with the Conversion and Offering; | ||
| Discuss the appraisal process and analyze the appraisal with the Board of Directors and management; | ||
| Participate in drafting the offering disclosure documents and any proxy materials, and assist in obtaining all requisite regulatory approvals; |
| Develop a marketing plan for the subscription and community offerings, considering various sales method options, including direct mail, advertising, community meetings and telephone solicitation; | ||
| Stifel Nicolaus will work with the Company to provide specifications and assistance (including recommendations) in selecting certain other professionals that will perform functions in connection with the Conversion and Offering process. Fees and expenses of financial printers, transfer agent and other service providers will be borne by the Company, subject to agreements between the Company and the service providers; | ||
| Develop a depositor proxy solicitation plan; | ||
| Advise/Assist through the planning process and organization of the Stock Information Center (the Center); | ||
| Develop a layout for the Center, where stock order processing and depositor vote solicitation occur; | ||
| Provide a list of equipment, staff and supplies needed for the Center; | ||
| Draft marketing materials including press releases, letters, stock order form, advertisements, and informational brochures. If a community meeting or road show is anticipated, we will help draft the presentation; and | ||
| After consulting with management, determine whether and when to conduct a syndicated community offering through assembling a group of selected broker/dealers (including Stifel Nicolaus) to sell stock remaining after the community offering, on a best-effort basis. Alternatively, consulting with management, as it relates to a stand-by firm commitment public underwriting, involving Stifel Nicolaus and other broker/dealers. |
| Provide experienced on-site Stifel Nicolaus FINRA registered representatives to manage and supervise the Center; | ||
| Administer the Center. All substantive investor related matters will be handled by employees of Stifel Nicolaus; | ||
| Train and supervise Center staff assisting with order processing; | ||
| Prepare procedures for processing stock orders and cash, and for handling requests for information; | ||
| Educate the Companys directors, officers and employees about the Offering, their roles and relevant securities laws; |
| Educate branch managers and customer-contact employees on the proper response to stock purchase inquiries; | ||
| Prepare daily sales reports for management and ensure funds received balance to such reports; | ||
| Coordinate functions with the data processing agent, printer, transfer agent, stock certificate printer and other professionals; | ||
| Coordinate with the Companys stock exchange and the Depository Trust Company to ensure a smooth closing and orderly stock trading; | ||
| Design and implement procedures for facilitating orders within IRA and Keogh accounts; and | ||
| Provide post-offering subscriber assistance and management of the pro-ration process, in the event orders exceed shares available in the Offering. |
| The Stifel Nicolaus registered representatives at the Center will seek to manage the sales function and, if applicable, will solicit orders from the prospects described above; | ||
| If applicable, assist management in developing a list of potential investors who are viewed as priority prospects; | ||
| Respond to investment-related and other questions regarding information in the Offering disclosure documents provided to potential investors; | ||
| If the sales plan calls for community meetings, participate in them; | ||
| Continually advise management on market conditions and the customers/communitys responsiveness to the Offering; | ||
| In case of a best-efforts syndicated community offering, manage the selling group. Alternatively, manage the underwriters participating in a stand-by firm commitment underwritten public offering, hi either case, we will prepare broker fact sheets and arrange road shows for the purpose of generating interest hi the stock and informing the brokerage community of the particulars of the Offering; and | ||
| Coordinate efforts to maximize after-market support and Company sponsorship. |
a. | An advisory and administrative fee of $50,000 in connection with the advisory and administrative services; the administrative and advisory fee shall be payable as follows: 25,000 upon signing this Agreement and $25,000 upon the initial filing of the Registration Statement. | ||
b. | A fee of one percent (1.00%) of the dollar amount of the Common Stock sold in the subscription and community offerings. No fee shall be payable pursuant to this subsection in connection with the sale of stock to the Companys charitable foundation, officers, directors, employees or immediate family of such persons (Insiders) and qualified and non qualified employee benefit plans of the Company or the Insiders. Immediate family includes spouse, parents, siblings and children who live in the same house as the officer, director, or employee. | ||
c. | For stock sold by a group of selected dealers (including Stifel Nicolaus) pursuant to a syndicated community offering solely managed by Stifel Nicolaus (the Selling Group), a fee equal to one percent (1.00%) of the aggregate dollar amount of Common Stock sold in the syndicated community offering, which fee paid to Stifel Nicolaus, along with the fee payable directly by the Company to Stifel Nicolaus and other selected dealers for their sales shall not exceed five percent (5.00%) of the aggregate dollar amount of Common Stock sold, provided Stifel Nicolaus will endeavor to further limit the aggregate fees to be paid by the Company under any such selected dealers agreement to an amount competitive with gross underwriting discounts charged at such time. Stifel Nicolaus will serve as sole book running manager of the syndicated community offering and be entitled to a minimum of 70 percent participation in such offering. Subject to the foregoing and in consultation with Stifel Nicolaus, the Company will determine which FINRA member firms will serve as co-managers of the Syndicated Community Offering or otherwise participate in the Selling Group and the extent of their participation. Stifel Nicolaus will not commence sales of the Common Stock through the Selling Group without the specific prior approval of the Company. | ||
d. | If, pursuant to a resolicitation of subscribers undertaken by the Company, Stifel Nicolaus is required to provide significant additional services, the additional compensation due will not exceed $50,000. |
STIFEL, NICOLAUS & COMPANY, INCORPORATED
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BY : | /s/ Ben A. Plotkin | |||
Ben A. Plotkin | ||||
Executive Vice President | ||||
ORITANI FINANCIAL CORP, MHC
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BY : | /s/ Kevin J. Lynch | |||
Kevin J. Lynch | ||||
Chairman,,President and Chief Executive Officer | ||||
ORITANI FINANCIAL CORP.
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BY : | /s/ Kevin J. Lynch | |||
Kevin J. Lynch | ||||
Chairman, President and Chief Executive Officer | ||||
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Very truly yours,
ORITANI FINANCIAL CORP. |
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By: | ||||
Kevin J. Lynch | ||||
Chairman, President and Chief Executive Officer | ||||
ORITANI FINANCIAL CORP.
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By: | ||||
Kevin J. Lynch | ||||
Chairman, President and Chief Executive Officer | ||||
ORITANI FINANCIAL CORP., MHC
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By: | ||||
Kevin J. Lynch | ||||
Chairman, President and Chief Executive Officer | ||||
ORITANI BANK
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By: | ||||
Kevin J. Lynch | ||||
Chairman, President and Chief Executive Officer | ||||
By: | ||||
Robin P. Suskind | ||||
Managing Director |
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Name: | T. Richard Kendrick, IV | |||
Title: | Senior Vice President |
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1. | Hampshire Financial LLC | |
2. | Oritani LLC |
1. | Hampshire LP | |
2. | Hampshire LLC |
(a) | Affiliate shall have the meaning ascribed to it in Rule 12b-2 of the General Rules and Regulations under the Securities Exchange Act of 1934, as in effect on the date of filing of this Certificate of Incorporation. | ||
(b) | Beneficial ownership shall be determined pursuant to Rule 13d-3 of the General Rules and Regulations under the Securities Exchange Act of 1934 (or any successor rule or statutory provision), or, if said Rule 13d-3 shall be rescinded and there shall be no successor rule or statutory provision thereto, pursuant to said Rule 13d-3 as in effect on the date of filing of this Certificate of Incorporation; provided, however, that a person shall, in any event, also be deemed the beneficial owner of any Common Stock: |
(1) | which such person or any of its affiliates beneficially owns, directly or indirectly; or | ||
(2) | which such person or any of its affiliates has (i) the right to acquire (whether such right is exercisable immediately or only after the passage of time), pursuant to any agreement, arrangement or understanding (but shall not be deemed to be the beneficial owner of any voting shares solely by reason of an agreement, contract, or other arrangement with this Corporation to effect any transaction which is described in any one or more of clauses of Section A of Article EIGHTH) or upon the exercise of conversion rights, exchange rights, warrants, or options or otherwise, or (ii) sole or shared voting or investment power with respect thereto pursuant to any agreement, arrangement, understanding, relationship or otherwise (but shall not be deemed to be the beneficial owner of any voting shares solely by reason of a revocable proxy granted for a particular meeting of stockholders, pursuant to a public solicitation of proxies for such meeting, with respect to shares of which neither such person nor any such affiliate is otherwise deemed the beneficial owner); or | ||
(3) | which are beneficially owned, directly or indirectly, by any other person with which such first mentioned person or any of its affiliates acts as a partnership, limited partnership, syndicate or |
2
other group pursuant to any agreement, arrangement or understanding for the purpose of acquiring, holding, voting or disposing of any shares of capital stock of this Corporation; |
and provided further, however, that (1) no Director or Officer of this Corporation (or any affiliate of any such Director or Officer) shall, solely by reason of any or all of such Directors or Officers acting in their capacities as such, be deemed, for any purposes hereof, to beneficially own any Common Stock beneficially owned by another such Director or Officer (or any affiliate thereof), and (2) neither any employee stock ownership plan or similar plan of this Corporation or any subsidiary of this Corporation, nor any trustee with respect thereto or any affiliate of such trustee (solely by reason of such capacity of such trustee), shall be deemed, for any purposes hereof, to beneficially own any Common Stock held under any such plan. For purposes of computing the percentage beneficial ownership of Common Stock of a person the outstanding Common Stock shall include shares deemed owned by such person through application of this subsection but shall not include any other Common Stock which may be issuable by this Corporation pursuant to any agreement, or upon exercise of conversion rights, warrants or options, or otherwise. For all other purposes, the outstanding Common Stock shall include only Common Stock then outstanding and shall not include any Common Stock which may be issuable by this Corporation pursuant to any agreement, or upon the exercise of conversion rights, warrants or options, or otherwise. | |||
(c) | A person shall include an individual, firm, a group acting in concert, a corporation, a partnership, an association, a joint venture, a pool, a joint stock company, a trust, an unincorporated organization or similar company, a syndicate or any other group formed for the purpose of acquiring, holding or disposing of securities or any other entity. |
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Name | Mailing Address | |||||||||
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John J. Gorman | 5335 Wisconsin Avenue, N.W. | ||||||||
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Suite 780 | |||||||||
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Washington, D.C. 20015 |
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/s/ John J. Gorman | ||||
John J. Gorman | ||||
Incorporator | ||||
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(i) | no authority to amend the charter or certificate of incorporation. | ||
(ii) | no authority to recommend to the stockholders a plan of merger or consolidation or conversion. | ||
(iii) | no power to sell, lease or otherwise dispose of all or substantially all of the property and assets of the Corporation otherwise than in the usual and regular course of business. | ||
(iv) | no authority to approve any transaction in which any member of the Executive Committee directly or indirectly has any material beneficial interest. | ||
(v) | no authority to exercise any powers of the Executive Committee while a quorum of the Board is actually convened for the conduct of business. | ||
(vi) | no authority to declare a dividend or approve any other distribution to stockholders. | ||
(vii) | no authority to make, alter, or repeal the by-laws of the Corporation. | ||
(viii) | no authority to elect or appoint any officer or director. | ||
(ix) | no authority to revoke any of the foregoing. | ||
(x) | no authority to exercise any other power which the laws of the State of Delaware specifically provide shall be exercised by at least a majority of all Directors. |
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(i) | Any Executive Vice President of the Corporation in the order as may be designated by the Board; | ||
(ii) | Any Senior Vice President of the Corporation in the order as may be designated by the Board. |
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(i) | Any Executive Vice President of the Corporation in the order as may be designated by the Board | ||
(ii) | Any Senior Vice President of the Corporation in the order as may be designated by the Board | ||
(iii) | Treasurer of the Corporation | ||
(iv) | Secretary of the Corporation |
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ORITANI FINANCIAL CORP
.
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Shares |
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CUSIP: |
THE SHARES REPRESENTED BY THIS | ||
CERTIFICATE ARE SUBJECT TO | ||
RESTRICTIONS, SEE REVERSE SIDE | ||
THIS CERTIFIES that | is the owner of |
By:
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[SEAL] | By: | ||||||
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PHILIP M. WYKS | KEVIN J. LYNCH | ||||||
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CORPORATE SECRETARY | PRESIDENT AND CHIEF EXECUTIVE | ||||||
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OFFICER |
TEN COM
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as tenants in common | UNIF GIFT MIN ACT | ______ Custodian ______ | |||
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(Cust) (Minor) | |||||
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TEN ENT
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as tenants by the entireties | |||||
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Under Uniform Gifts to Minors Act | |||||
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JT TEN
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as joint tenants with right | |||||
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of survivorship and not as
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tenants in common
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In the presence of
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Signature: | |
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Re: |
Oritani Financial Corp. (a Delaware corporation)
Common Stock, Par Value $0.01 Per Share |
Very truly yours,
/s/ Luse Gorman Pomerenk & Schick A Professional Corporation |
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(1) | The Mid-Tier Holding Company will establish the Holding Company as a first-tier Delaware-chartered stock holding company subsidiary. | ||
(2) | The Mutual Holding Company will merge with and into the Mid-Tier Holding Company with the Mid-Tier Holding Company as the resulting entity (the MHC Merger) whereby the shares of Mid-Tier Holding Company held by the Mutual Holding Company will be cancelled and the members of the Mutual Holding Company will automatically, without any further action on the part of the holders thereof, constructively receive liquidation interests in Mid-Tier Holding Company in exchange for their liquidation interests in the Mutual Holding Company. |
(3) | Immediately after the MHC Merger, the Mid-Tier Holding Company will merge with and into the Holding Company (the Mid-Tier Merger), with the Holding Company as the resulting entity. As part of the Mid-Tier Merger, the liquidation interests in Mid-Tier Holding Company constructively received by the members of Mutual Holding Company immediately prior to Conversion will automatically, without further action on the part of the holders thereof, be exchanged for an interest in the Liquidation Account and the Minority Shares shall be converted into and become the right to receive Holding Company Common Stock based on the Exchange Ratio. | ||
(4) | Immediately after the Mid-Tier Merger, the Holding Company will offer for sale its Common Stock in the Offering. | ||
(5) | The Holding Company will contribute at least 50% of the net proceeds of the Offering to the Bank in exchange for common stock of the Bank and the Bank Liquidation Account. |
RP
®
FINANCIAL, LC.
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Serving the Financial Services Industry Since 1988
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Sincerely,
|
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/s/ RP FINANCIAL, LC. | ||||
RP FINANCIAL, LC. | ||||
Washington Headquarters
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Rosslyn Center
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Telephone: (703) 528-1700 | |
1700 North Moore Street, Suite 2210
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Fax No.: (703) 528-1788 | |
Arlington, VA 22209
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Toll-Free No.: (866) 723-0594 | |
www.rpfinancial.com
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E-Mail: mail@rpfinancial.com |
RP
®
FINANCIAL, LC.
|
||
Serving the Financial Services Industry Since 1988
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Washington Headquarters
|
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Three Ballston Plaza
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Direct: (703) 647-6543 | |
1100 North Glebe Road, Suite 1100
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Telephone: (703) 528-1700 | |
Arlington, VA 22201
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Fax No.: (703) 528-1788 | |
E-Mail: rriggins@rpfinancial.com
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Toll-Free No.: (866) 723-0594 |
| $15,000 upon execution of this letter of agreement engaging RP Financials appraisal services; | ||
| $110,000 upon delivery of the completed original appraisal report; and | ||
| $15,000 upon delivery of each subsequent appraisal update report required in conjunction with the regulatory application and stock offering. It is anticipated that there will be at least one appraisal update report, specifically the update to be prepared in conjunction with the completion of the stock offering. |
Sincerely,
|
||||
/s/ Ronald S. Riggins | ||||
Ronald S. Riggins | ||||
President and Managing Director | ||||
Agreed To and Accepted By:
|
Mr. John M. Fields, Jr. | /s/ Mr. John M. Fields, Jr. | |||
|
|||||
Executive Vice President and Chief Financial Officer |
Upon Authorization by the Board of Directors For:
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Oritani Bank, subsidiary of | |
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Oritani Financial Corp. | |
|
Township of Washington, New Jersey |
| assess the regulatory, social, political and economic environment; | ||
| analyze the existing Companys markets from a demographic and competitive standpoint; | ||
| document the internal situation assessment; | ||
| analyze the current ALM position; | ||
| analyze the CRA position; | ||
| compile a historical trend analysis; | ||
| perform detailed peer performance and comparable analysis; | ||
| assess the Bank from a capital markets perspective including comparison to national, regional, and similar size organizations; | ||
| identify and document strengths and weaknesses; | ||
| document the objectives and goals; | ||
| document strategies; | ||
| map the Banks general ledger to FinPros planning model at a bank and consolidated level; |
| compile five year projections of performance; | ||
| perform multiple stress tests on the plan; and | ||
| prepare assessment of strategic alternatives to enhance value. |
| provide FinPro with all financial and other information, whether or not publicly available, necessary to familiarize FinPro with the business and operations of the Bank. | ||
| allow FinPro the opportunity, from time to time, to discuss the operation of the Bank business with bank personnel. | ||
| promptly advise FinPro of any material or contemplated material transactions which may have an effect on the day-to-day operations of the Bank. | ||
| have system download capability. | ||
| promptly review all work products of FinPro and provide necessary sign-offs on each work product so that FinPro can move on to the next phase. | ||
| provide FinPro with office space, when FinPro is on-site, to perform its daily tasks. The office space requirements consist of a table with at least two chairs along with access to electrical outlets for FinPros computers and a high speed internet connection. |
2
| $15,000 retainer payable at signing of this agreement; | ||
| $15,000 payable at the end of modeling sessions with management; and | ||
| Remainder of the strategic business plan and all final expenses payable upon final business plan delivery. |
1. | Out-of-Pocket all of FinPros reasonable travel and other out-of-pocket expenses incurred in connection with FinPros engagement. It is FinPro policy to itemize expenses for each project so that the client can review, by line item, each expense. | ||
2. | Data Cost There is a pass through cost for competitor financial/regulatory data which is equal to $1,000 and a market data passthrough cost of $500 per market. |
3
Washington Headquarters
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Three Ballston Plaza
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Telephone: (703) 528-1700 | |
1100 North Glebe Road, Suite 1100
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Fax No.: (703) 528-1788 | |
Arlington, VA 22201
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Toll-Free No.: (866) 723-0594 | |
www.rpfinancial.com
|
E-Mail: mail@rpfinancial.com |
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Respectfully submitted, | |
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RP ® FINANCIAL, LC. | |
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William E. Pommerening | |
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Chief Executive Officer and | |
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Managing Director | |
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Gregory E. Dunn | |
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Director |
TABLE OF CONTENTS
i
ORITANI FINANCIAL CORP.
ORITANI BANK
Township of Washington, New Jersey
PAGE
DESCRIPTION
NUMBER
I.1
I.2
I.3
I.7
I.11
I.15
I.16
I.19
I.20
1.22
I.23
II.1
II.2
II.7
II.9
II.10
II.11
III.1
III.6
III.9
III.12
III.14
III.16
III.16
RP
®
Financial,
LC.
|
TABLE OF CONTENTS | |
|
ii |
PAGE | ||
DESCRIPTION | NUMBER | |
CHAPTER FOUR VALUATION ANALYSIS
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Introduction
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IV.1 | |
Appraisal Guidelines
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IV.1 | |
RP Financial Approach to the Valuation
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IV.1 | |
Valuation Analysis
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IV.2 | |
1. Financial Condition
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IV.3 | |
2. Profitability, Growth and Viability of Earnings
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IV.5 | |
3. Asset Growth
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IV.7 | |
4. Primary Market Area
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IV.7 | |
5. Dividends
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IV.9 | |
6. Liquidity of the Shares
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IV.9 | |
7. Marketing of the Issue
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IV.10 | |
A. The Public Market
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IV.10 | |
B. The New Issue Market
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IV.15 | |
C. The Acquisition Market
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IV.19 | |
D. Trading in Oritani Financials Stock
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IV.19 | |
8. Management
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IV.20 | |
9. Effect of Government Regulation and Regulatory Reform
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IV.21 | |
Summary of Adjustments
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IV.21 | |
Valuation Approaches:
|
IV.21 | |
1. Price-to-Earnings (P/E)
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IV.23 | |
2. Price-to-Book (P/B)
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IV.26 | |
3. Price-to-Assets (P/A)
|
IV.26 | |
Comparison to Recent Offerings
|
IV.27 | |
Valuation Conclusion
|
IV.27 |
RP
®
Financial,
LC.
|
LIST OF TABLES | |
|
iii |
TABLE | ||||
NUMBER | DESCRIPTION | PAGE | ||
1.1
|
Historical Balance Sheet Data | I.8 | ||
1.2
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Historical Income Statements | I.12 | ||
|
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2.1
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Summary Demographic Data | II.8 | ||
2.2
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Primary Market Area Employment Sectors | II.10 | ||
2.3
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Unemployment Trends | II.11 | ||
2.4
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Deposit Summary | II.12 | ||
2.5
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Market Area Deposit Competitors | II.14 | ||
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3.1
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Peer Group of Publicly-Traded Thrifts | III.3 | ||
3.2
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Balance Sheet Composition and Growth Rates | III.7 | ||
3.3
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Income as a Pct. of Avg. Assets and Yields, Costs, Spreads | III.10 | ||
3.4
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Loan Portfolio Composition and Related Information | III.13 | ||
3.5
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Interest Rate Risk Measures and Net Interest Income Volatility | III.15 | ||
3.6
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Credit Risk Measures and Related Information | III.17 | ||
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4.1
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Market Area Unemployment Rates | IV.8 | ||
4.2
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Pricing Characteristics and After-Market Trends | IV.17 | ||
4.3
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Market Pricing Comparatives | IV.18 | ||
4.4
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Public Market Pricing | IV.25 |
RP
®
Financial, LC.
|
OVERVIEW AND FINANCIAL ANALYSIS | |
|
I.1 |
RP
®
Financial, LC.
|
OVERVIEW AND FINANCIAL ANALYSIS | |
|
I.2 |
RP
®
Financial, LC.
|
OVERVIEW AND FINANCIAL ANALYSIS | |
|
I.3 |
RP
®
Financial, LC.
|
OVERVIEW AND FINANCIAL ANALYSIS | |
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I.4 |
RP
®
Financial, LC.
|
OVERVIEW AND FINANCIAL ANALYSIS | |
|
I.5 |
RP
®
Financial, LC.
|
OVERVIEW AND FINANCIAL ANALYSIS | |
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I.6 |
o | Oritani Financial Corp. The Company is expected to retain up to 50% of the net offering proceeds. At present, funds maintained by the Company, net of the loan to the ESOP, are expected to be invested into short-term investment grade securities and liquid funds. Over time, the funds may be utilized for various corporate purposes, possibly including funding the Companys subsidiary activities, acquisitions, infusing additional equity into the Bank, repurchases of common stock, and the payment of cash dividends. | ||
o | Oritani Bank. Approximately 50% of the net stock proceeds will be infused into the Bank in exchange for all of the Banks stock. Cash proceeds (i.e., net proceeds less deposits withdrawn to fund stock purchases) infused into the Bank are anticipated to become part of general operating funds, and are expected to be primarily utilized to fund loan growth over time. |
RP
®
Financial, LC.
|
OVERVIEW AND FINANCIAL ANALYSIS | |
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I.7 |
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RP
®
Financial, LC.
|
OVERVIEW AND FINANCIAL ANALYSIS | |
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I.8 |
6/30/05- | ||||||||||||||||||||||||||||||||||||||||||||||||||||
12/31/09 | ||||||||||||||||||||||||||||||||||||||||||||||||||||
At Fiscal Year Ended June 30, | At December 31, | Annual. | ||||||||||||||||||||||||||||||||||||||||||||||||||
2005 | 2006 | 2007 | 2008 | 2009 | 2009 | Growth Rate | ||||||||||||||||||||||||||||||||||||||||||||||
Amount | Pct(1) | Amount | Pct(1) | Amount | Pct(1) | Amount | Pct(1) | Amount | Pct(1) | Amount | Pct(1) | Pct | ||||||||||||||||||||||||||||||||||||||||
($000) | (%) | ($000) | (%) | ($000) | (%) | ($000) | (%) | ($000) | (%) | ($000) | (%) | (%) | ||||||||||||||||||||||||||||||||||||||||
Total Amount of:
|
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Assets
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$ | 1,051,702 | 100.00 | % | $ | 1,031,421 | 100.00 | % | $ | 1,194,443 | 100.00 | % | $ | 1,443,294 | 100.00 | % | $ | 1,913,521 | 100.00 | % | $ | 2,006,874 | 100.00 | % | 15.44 | % | ||||||||||||||||||||||||||
Cash and cash equivalents
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18,183 | 1.73 | % | 7,274 | 0.71 | % | 63,526 | 5.32 | % | 8,890 | 0.62 | % | 135,369 | 7.07 | % | 26,332 | 1.31 | % | 8.58 | % | ||||||||||||||||||||||||||||||||
Investment securities
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86,420 | 8.22 | % | 23,914 | 2.32 | % | 40,858 | 3.42 | % | 22,285 | 1.54 | % | 144,419 | 7.55 | % | 320,439 | 15.97 | % | 33.81 | % | ||||||||||||||||||||||||||||||||
Mortgage-backed securities
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397,763 | 37.82 | % | 292,121 | 28.32 | % | 256,379 | 21.46 | % | 313,159 | 21.70 | % | 247,420 | 12.93 | % | 184,695 | 9.20 | % | -15.67 | % | ||||||||||||||||||||||||||||||||
Loans receivable, net
|
493,554 | 46.93 | % | 643,064 | 62.35 | % | 758,542 | 63.51 | % | 1,007,077 | 69.78 | % | 1,278,623 | 66.82 | % | 1,357,157 | 67.63 | % | 25.20 | % | ||||||||||||||||||||||||||||||||
FHLB stock
|
9,088 | 0.86 | % | 9,367 | 0.91 | % | 10,619 | 0.89 | % | 21,547 | 1.49 | % | 25,549 | 1.34 | % | 25,481 | 1.27 | % | 25.75 | % | ||||||||||||||||||||||||||||||||
Bank owned life insurance
|
18,988 | 1.81 | % | 24,381 | 2.36 | % | 25,365 | 2.12 | % | 26,425 | 1.83 | % | 29,385 | 1.54 | % | 29,973 | 1.49 | % | 10.68 | % | ||||||||||||||||||||||||||||||||
Investments in real estate joint ventures
|
5,438 | 0.52 | % | 6,233 | 0.60 | % | 6,200 | 0.52 | % | 5,564 | 0.39 | % | 5,767 | 0.30 | % | 5,836 | 0.29 | % | 1.58 | % | ||||||||||||||||||||||||||||||||
|
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Deposits
|
$ | 702,980 | 66.84 | % | $ | 688,646 | 66.77 | % | $ | 695,757 | 58.25 | % | $ | 698,932 | 48.43 | % | $ | 1,127,630 | 58.93 | % | $ | 1,210,507 | 60.32 | % | 12.84 | % | ||||||||||||||||||||||||||
Borrowings
|
182,129 | 17.32 | % | 169,780 | 16.46 | % | 196,661 | 16.46 | % | 433,672 | 30.05 | % | 508,991 | 26.60 | % | 507,439 | 25.29 | % | 25.57 | % | ||||||||||||||||||||||||||||||||
|
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Equity
|
$ | 141,796 | 13.48 | % | $ | 150,135 | 14.56 | % | $ | 272,570 | 22.82 | % | $ | 278,975 | 19.33 | % | $ | 240,098 | 12.55 | % | $ | 247,950 | 12.36 | % | 13.22 | % | ||||||||||||||||||||||||||
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Loans/Deposits
|
70.21 | % | 93.38 | % | 109.02 | % | 144.09 | % | 113.39 | % | 112.11 | % | ||||||||||||||||||||||||||||||||||||||||
|
||||||||||||||||||||||||||||||||||||||||||||||||||||
Full Service Banking Offices Open
|
21 | 19 | 19 | 19 | 21 | 21 |
(1) | Ratios are as a percent of ending assets. |
RP ® Financial, LC. | OVERVIEW AND FINANCIAL ANALYSIS | |
I.9 |
RP ® Financial, LC. | OVERVIEW AND FINANCIAL ANALYSIS | |
I.10 |
RP ® Financial, LC. | OVERVIEW AND FINANCIAL ANALYSIS | |
I.11 |
RP ® Financial, LC. | OVERVIEW AND FINANCIAL ANALYSIS | |
I.12 |
For the Fiscal Year Ended June 30, | For the 12 months | |||||||||||||||||||||||||||||||||||||||||||||||
2005 | 2006 | 2007 | 2008 | 2009 | Ended 12/31/09 | |||||||||||||||||||||||||||||||||||||||||||
Amount | Pct(1) | Amount | Pct(1) | Amount | Pct(1) | Amount | Pct(1) | Amount | Pct(1) | Amount | Pct(1) | |||||||||||||||||||||||||||||||||||||
($000) | (%) | ($000) | (%) | ($000) | (%) | ($000) | (%) | ($000) | (%) | ($000) | (%) | |||||||||||||||||||||||||||||||||||||
Interest income
|
$ | 46,439 | 4.46 | % | $ | 51,276 | 4.91 | % | $ | 63,349 | 5.40 | % | $ | 71,591 | 5.43 | % | $ | 88,429 | 5.26 | % | $ | 97,156 | 5.19 | % | ||||||||||||||||||||||||
Interest expense
|
(18,349 | ) | -1.76 | % | (23,522 | ) | -2.25 | % | (32,829 | ) | -2.80 | % | (37,208 | ) | -2.82 | % | (44,500 | ) | -2.64 | % | (46,061 | ) | -2.46 | % | ||||||||||||||||||||||||
|
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Net interest income
|
$ | 28,090 | 2.70 | % | $ | 27,754 | 2.66 | % | $ | 30,520 | 2.60 | % | $ | 34,383 | 2.61 | % | $ | 43,929 | 2.60 | % | $ | 51,095 | 2.72 | % | ||||||||||||||||||||||||
Provision for loan losses
|
(800 | ) | -0.08 | % | (1,500 | ) | -0.14 | % | (1,210 | ) | -0.10 | % | (4,650 | ) | -0.35 | % | (9,880 | ) | -0.59 | % | (9,555 | ) | -0.51 | % | ||||||||||||||||||||||||
|
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Net interest income after provisions
|
$ | 27,290 | 2.62 | % | $ | 26,254 | 2.51 | % | $ | 29,310 | 2.50 | % | $ | 29,733 | 2.26 | % | $ | 34,049 | 2.02 | % | $ | 41,540 | 2.22 | % | ||||||||||||||||||||||||
|
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Other operating income
|
$ | 2,877 | 0.28 | % | $ | 4,116 | 0.39 | % | $ | 4,795 | 0.41 | % | $ | 4,838 | 0.37 | % | $ | 4,825 | 0.29 | % | $ | 5,117 | 0.27 | % | ||||||||||||||||||||||||
Operating expense
|
(14,800 | ) | -1.42 | % | (17,524 | ) | -1.68 | % | (16,139 | ) | -1.37 | % | (19,491 | ) | -1.48 | % | (27,257 | ) | -1.62 | % | (29,835 | ) | -1.59 | % | ||||||||||||||||||||||||
|
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Net operating income
|
$ | 15,367 | 1.48 | % | $ | 12,846 | 1.23 | % | $ | 17,966 | 1.53 | % | $ | 15,080 | 1.14 | % | $ | 11,617 | 0.69 | % | $ | 16,822 | 0.90 | % | ||||||||||||||||||||||||
|
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Non-Operating Income
|
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Gain(loss) on sale and writedown of securities
|
($1,214 | ) | -0.12 | % | ($355 | ) | -0.03 | % | | 0.00 | % | ($998 | ) | -0.08 | % | ($2,045 | ) | -0.12 | % | ($435 | ) | -0.02 | % | |||||||||||||||||||||||||
Gain(loss) on sale of fixed assets
|
| 0.00 | % | 799 | 0.08 | % | 514 | 0.04 | % | | 0.00 | % | | 0.00 | % | 1,043 | 0.06 | % | ||||||||||||||||||||||||||||||
Contribution to charitable foundation
|
| 0.00 | % | | 0.00 | % | (9,110 | ) | -0.78 | % | | 0.00 | % | | 0.00 | % | | 0.00 | % | |||||||||||||||||||||||||||||
Gain on sale of REI
|
| 0.00 | % | | 0.00 | % | | 0.00 | % | 1,096 | 0.08 | % | | 0.00 | % | | 0.00 | % | ||||||||||||||||||||||||||||||
|
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Net non-operating income
|
($1,214 | ) | -0.12 | % | $ | 444 | 0.04 | % | ($8,596 | ) | -0.73 | % | $ | 98 | 0.01 | % | ($2,045 | ) | -0.12 | % | $ | 608 | 0.03 | % | ||||||||||||||||||||||||
|
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Net income before tax
|
$ | 14,153 | 1.36 | % | $ | 13,290 | 1.27 | % | $ | 9,370 | 0.80 | % | $ | 15,178 | 1.15 | % | $ | 9,572 | 0.57 | % | $ | 17,430 | 0.93 | % | ||||||||||||||||||||||||
Income tax provision
|
(5,193 | ) | -0.50 | % | (4,827 | ) | -0.46 | % | 1,664 | 0.14 | % | (6,218 | ) | -0.47 | % | (4,020 | ) | -0.24 | % | (7,011 | ) | -0.37 | % | |||||||||||||||||||||||||
|
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Net income (loss)
|
$ | 8,960 | 0.86 | % | $ | 8,463 | 0.81 | % | $ | 11,034 | 0.94 | % | $ | 8,960 | 0.68 | % | $ | 5,552 | 0.33 | % | $ | 10,419 | 0.56 | % | ||||||||||||||||||||||||
|
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Adjusted Earnings
|
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Net income
|
$ | 8,960 | 0.86 | % | $ | 8,463 | 0.81 | % | $ | 11,034 | 0.94 | % | $ | 8,960 | 0.68 | % | $ | 5,552 | 0.33 | % | $ | 10,419 | 0.56 | % | ||||||||||||||||||||||||
Add(Deduct): Net gain/(loss) on sale
|
1,214 | 0.12 | % | (444 | ) | -0.04 | % | 8,596 | 0.73 | % | (98 | ) | -0.01 | % | 2,045 | 0.12 | % | (608 | ) | -0.03 | % | |||||||||||||||||||||||||||
Tax effect (2)
|
(473 | ) | -0.05 | % | 173 | 0.02 | % | (3,352 | ) | -0.29 | % | 38 | 0.00 | % | (798 | ) | -0.05 | % | 237 | 0.01 | % | |||||||||||||||||||||||||||
|
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Adjusted earnings
|
$ | 9,701 | 0.93 | % | $ | 8,192 | 0.78 | % | $ | 16,278 | 1.39 | % | $ | 8,900 | 0.68 | % | $ | 6,799 | 0.40 | % | $ | 10,048 | 0.54 | % | ||||||||||||||||||||||||
|
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Expense Coverage Ratio (3)
|
1.90 | 1.58 | 1.89 | 1.76 | 1.61 | 1.71 | ||||||||||||||||||||||||||||||||||||||||||
Efficiency Ratio (4)
|
47.7 | % | 55.0 | % | 45.7 | % | 49.7 | % | 56.0 | % | 53.2 | % |
(1) | Ratios are as a percent of average assets. | |
(2) | Assumes a 39.0% effective tax rate. | |
(3) | Expense coverage ratio calculated as net interest income before provisions for loan losses divided by operating expenses. | |
(4) | Efficiency ratio calculated as operating expenses divided by the sum of net interest income before provisions for loan losses plus other income (excluding net gains). |
RP ® Financial, LC. | OVERVIEW AND FINANCIAL ANALYSIS | |
I.13 |
RP ® Financial, LC. | OVERVIEW AND FINANCIAL ANALYSIS | |
I.14 |
RP ® Financial, LC. | OVERVIEW AND FINANCIAL ANALYSIS | |
I.15 |
RP ® Financial, LC. | OVERVIEW AND FINANCIAL ANALYSIS | |
I.16 |
RP ® Financial, LC. | OVERVIEW AND FINANCIAL ANALYSIS | |
I.17 |
RP ® Financial, LC. | OVERVIEW AND FINANCIAL ANALYSIS | |
I.18 |
RP ® Financial, LC. | OVERVIEW AND FINANCIAL ANALYSIS | |
I.19 |
RP ® Financial, LC. | OVERVIEW AND FINANCIAL ANALYSIS | |
I.20 |
RP ® Financial, LC. | OVERVIEW AND FINANCIAL ANALYSIS | |
I.21 |
RP ® Financial, LC. | OVERVIEW AND FINANCIAL ANALYSIS | |
I.22 |
RP ® Financial, LC. | OVERVIEW AND FINANCIAL ANALYSIS | |
I.23 |
RP ® Financial, LC. | MARKET AREA | |
II.1 |
RP ® Financial, LC. | MARKET AREA | |
II.2 |
RP ® Financial, LC. | MARKET AREA | |
II.3 |
RP ® Financial, LC. | MARKET AREA | |
II.4 |
RP ® Financial, LC. | MARKET AREA | |
II.5 |
RP ® Financial, LC. | MARKET AREA | |
II.6 |
RP ® Financial, LC. | MARKET AREA | |
II.7 |
RP ® Financial, LC. | Market Area | |
II.8 |
Year | Growth Rate | ||||||||||||||||||||
2000 | 2009 | 2014 | 2000-2009 | 2009-2014 | |||||||||||||||||
Population (000)
|
|||||||||||||||||||||
United States
|
281,422 | 309,732 | 324,063 | 1.1 | % | 0.9 | % | ||||||||||||||
New Jersey
|
6,350 | 6,499 | 6,543 | 0.3 | % | 0.1 | % | ||||||||||||||
Bergen County
|
884 | 911 | 921 | 0.3 | % | 0.2 | % | ||||||||||||||
Hudson County
|
609 | 615 | 612 | 0.1 | % | -0.1 | % | ||||||||||||||
Passaic County
|
489 | 500 | 499 | 0.2 | % | 0.0 | % | ||||||||||||||
|
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Households (000)
|
|||||||||||||||||||||
United States
|
105,480 | 116,523 | 122,109 | 1.1 | % | 0.9 | % | ||||||||||||||
New Jersey
|
2,444 | 2,517 | 2,541 | 0.3 | % | 0.2 | % | ||||||||||||||
Bergen County
|
331 | 339 | 343 | 0.3 | % | 0.2 | % | ||||||||||||||
Hudson County
|
231 | 233 | 232 | 0.1 | % | -0.1 | % | ||||||||||||||
Passaic County
|
164 | 164 | 163 | 0.0 | % | -0.1 | % | ||||||||||||||
|
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Median Household Income ($)
|
|||||||||||||||||||||
United States
|
$ | 42,164 | $ | 54,719 | $ | 56,938 | 2.9 | % | 0.8 | % | |||||||||||
New Jersey
|
50,539 | 68,225 | 71,891 | 3.4 | % | 1.1 | % | ||||||||||||||
Bergen County
|
64,914 | 84,586 | 88,787 | 3.0 | % | 1.0 | % | ||||||||||||||
Hudson County
|
40,316 | 52,390 | 56,487 | 3.0 | % | 1.5 | % | ||||||||||||||
Passaic County
|
49,211 | 62,439 | 68,433 | 2.7 | % | 1.9 | % | ||||||||||||||
|
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Per Capita Income ($)
|
|||||||||||||||||||||
United States
|
$ | 21,587 | $ | 27,277 | $ | 28,494 | 2.6 | % | 0.9 | % | |||||||||||
New Jersey
|
25,952 | 34,904 | 37,151 | 3.3 | % | 1.3 | % | ||||||||||||||
Bergen County
|
33,638 | 42,097 | 43,992 | 2.5 | % | 0.9 | % | ||||||||||||||
Hudson County
|
21,154 | 26,304 | 27,186 | 2.5 | % | 0.7 | % | ||||||||||||||
Passaic County
|
21,370 | 26,508 | 26,909 | 2.4 | % | 0.3 | % | ||||||||||||||
|
|||||||||||||||||||||
|
Less Than | $25,000 to | $50,000 to | ||||||||||||||||||
|
$ | 25,000 | 50,000 | 100,000 | $ | 100,000 | + | ||||||||||||||
|
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2009 HH Income Dist. (%)
|
|||||||||||||||||||||
United States
|
20.9 | % | 24.5 | % | 35.3 | % | 19.3 | % | |||||||||||||
New Jersey
|
22.3 | % | 25.0 | % | 34.3 | % | 18.4 | % | |||||||||||||
Bergen County
|
11.7 | % | 15.8 | % | 31.5 | % | 41.4 | % | |||||||||||||
Hudson County
|
24.4 | % | 23.2 | % | 34.9 | % | 17.6 | % | |||||||||||||
Passaic County
|
18.2 | % | 21.5 | % | 35.6 | % | 24.7 | % |
RP ® Financial, LC. | Market Area | |
II.9 |
RP ® Financial, LC. | Market Area | |
II.10 |
Employment Sectors | New Jersey | Bergen | Hudson | Passaic | ||||||||||||
Services
|
42.2 | % | 45.0 | % | 35.0 | % | 40.3 | % | ||||||||
Wholesale/Retail Trade
|
15.8 | 18.1 | 14.1 | 18.6 | ||||||||||||
Government
|
12.8 | 8.2 | 14.8 | 13.4 | ||||||||||||
Fin., Ins., Real Estate
|
10.6 | 10.7 | 16.3 | 8.2 | ||||||||||||
Manufacturing
|
6.3 | 7.1 | 3.8 | 9.0 | ||||||||||||
Construction
|
5.3 | 4.9 | 3.1 | 5.8 | ||||||||||||
Transport. & Warehousing
|
4.0 | 3.2 | 9.3 | 3.0 | ||||||||||||
Information
|
2.2 | 2.5 | 3.3 | 1.4 | ||||||||||||
Other
|
0.8 | 0.3 | 0.3 | 0.3 | ||||||||||||
|
||||||||||||||||
|
100.0 | % | 100.0 | % | 100.0 | % | 100.0 | % |
(1) | Data is as of 2007. |
RP ® Financial, LC. | Market Area | |
II.11 |
December 2008 | December 2009 | |||||||
Region | Unemployment | Unemployment | ||||||
United States
|
7.1 | % | 9.7 | % | ||||
New Jersey
|
6.8 | 9.8 | ||||||
Bergen County
|
5.3 | 8.1 | ||||||
Hudson County
|
7.7 | 11.2 | ||||||
Passaic County
|
8.3 | 11.8 |
(1) | Unemployment rates have not been seasonally adjusted. |
RP ® Financial, LC. | Market Area | |
II.12 |
As of June 30, | ||||||||||||||||||||||||||||
2005 | 2009 | Deposit | ||||||||||||||||||||||||||
Market | # of | Market | # of | Growth Rate | ||||||||||||||||||||||||
Deposits | Share | Branches | Deposits | Share | Branches | 2005-2009 | ||||||||||||||||||||||
(Dollars in Thousands) | (%) | |||||||||||||||||||||||||||
State of New Jersey
|
$ | 222,556,000 | 100.0 | % | 3,222 | $ | 250,064,000 | 100.0 | % | 3,347 | 3.0 | % | ||||||||||||||||
Commercial Banks
|
163,756,000 | 73.6 | % | 2,316 | 169,528,000 | 67.8 | % | 2,457 | 0.9 | % | ||||||||||||||||||
Savings Institutions
|
58,800,000 | 26.4 | % | 906 | 80,536,000 | 32.2 | % | 890 | 8.2 | % | ||||||||||||||||||
|
||||||||||||||||||||||||||||
Bergen County
|
$ | 33,136,190 | 100.0 | % | 483 | $ | 37,015,398 | 100.0 | % | 493 | 2.8 | % | ||||||||||||||||
Commercial Banks
|
20,738,781 | 62.6 | % | 340 | 24,938,917 | 67.4 | % | 372 | 4.7 | % | ||||||||||||||||||
Savings Institutions
|
12,397,409 | 37.4 | % | 143 | 12,076,481 | 32.6 | % | 121 | -0.7 | % | ||||||||||||||||||
Oritani Financial
|
572,229 | 1.7 | % | 15 | 964,952 | 2.6 | % | 16 | 14.0 | % | ||||||||||||||||||
|
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Hudson County
|
$ | 33,618,519 | 100.0 | % | 179 | $ | 22,049,307 | 100.0 | % | 193 | -10.0 | % | ||||||||||||||||
Commercial Banks
|
29,738,609 | 88.5 | % | 114 | 18,040,723 | 81.8 | % | 134 | -11.7 | % | ||||||||||||||||||
Savings Institutions
|
3,879,910 | 11.5 | % | 65 | 4,008,584 | 18.2 | % | 59 | 0.8 | % | ||||||||||||||||||
Oritani Financial
|
103,063 | 0.3 | % | 4 | 127,941 | 0.6 | % | 5 | 5.6 | % | ||||||||||||||||||
|
||||||||||||||||||||||||||||
Passaic County
|
$ | 9,079,640 | 100.0 | % | 153 | $ | 9,866,022 | 100.0 | % | 158 | 2.1 | % | ||||||||||||||||
Commercial Banks
|
6,973,072 | 76.8 | % | 127 | 7,658,607 | 77.6 | % | 134 | 2.4 | % | ||||||||||||||||||
Savings Institutions
|
2,106,568 | 23.2 | % | 26 | 2,207,415 | 22.4 | % | 24 | 1.2 | % | ||||||||||||||||||
Oritani Financial
|
27,687 | 0.3 | % | 1 | 46,633 | 0.5 | % | 1 | 13.9 | % |
RP ® Financial, LC. | Market Area | |
II.13 |
RP ® Financial, LC. | Market Area | |
II.14 |
Location | Name | |
Bergen County
|
Bank of American Corp. (17.4%) | |
|
Hudson City Bancorp (15.3%) | |
|
Toronto-Dominion Bank (12.5%) | |
|
Oritani Financial (2.6%) Rank of 9 | |
|
||
Hudson County
|
Bank of American Corp. (62.0%) | |
|
Hudson City Bancorp. (5.7%) | |
|
Provident Financial Services (4.4%) | |
|
Oritani Financial (0.6%) Rank of 17 | |
|
||
Passaic County
|
Valley National Bancorp (25.0%) | |
|
Wells Fargo & Company (10.8%) | |
|
Hudson City Bancorp. (10.6%) | |
|
Oritani Financial (0.5%) Rank of 17 |
RP ® Financial, LC. | PEER GROUP ANALYSIS | |
III.1 |
RP ® Financial, LC. | PEER GROUP ANALYSIS | |
III.2 |
o | Screen #1 Mid-Atlantic institutions with assets between $1.0 billion and $3.5 billion, tangible equity-to-assets ratios of greater than 6.0% and positive core earnings. Six companies met the criteria for Screen #1 and all six were included in the Peer Group: Beacon Federal Bancorp of New York, ESB Financial Corp. of Pennsylvania, ESSA Bancorp, Inc. of Pennsylvania, OceanFirst Financial Corp. of New Jersey, Parkvale Financial Corp. of Pennsylvania and Provident New York Bancorp of New York. Exhibit III-2 provides financial and public market pricing characteristics of all publicly-traded Mid-Atlantic thrifts. | ||
o | Screen #2 New England institutions with assets between $1.0 billion and $3.5 billion, tangible equity-to-assets ratios of greater than 6.0% and positive core earnings. Four companies met the criteria for Screen #2 and all four were included in the Peer Group: Brookline Bancorp of Massachusetts, Danvers Bancorp of Massachusetts, Westfield Financial of Massachusetts and United Financial Bancorp of Massachusetts. Exhibit III-3 provides financial and public market pricing characteristics of all publicly-traded New England thrifts. |
RP ® Financial, LC. | PEER GROUP ANALYSIS | |
III.3 |
Operating | Total | Fiscal | Conv. | Stock | Market | |||||||||||||||||||||||||||||
Ticker | Financial Institution | Exchange | Primary Market | Strategy(1) | Assets(2) | Offices | Year | Date | Price | Value | ||||||||||||||||||||||||
($) | ($Mil) | |||||||||||||||||||||||||||||||||
PBNY
|
Provident NY Bancorp, Inc. of NY | NASDAQ | Montebello, NY | Thrift | $ | 2,918 | 35 | 09-30 | 01/04 | $ | 8.48 | $ | 331 | |||||||||||||||||||||
BRKL
|
Brookline Bancorp, Inc. of MA | NASDAQ | Brookline, MA | Thrift | $ | 2,616 | 17 | 12-31 | 07/02 | $ | 9.76 | $ | 576 | |||||||||||||||||||||
DNBK
|
Danvers Bancorp, Inc. of MA | NASDAQ | Danvers, MA | Thrift | $ | 2,500 | 15 | 12-31 | 01/08 | $ | 13.94 | $ | 303 | |||||||||||||||||||||
OCFC
|
OceanFirst Financial Corp. of NJ | NASDAQ | Toms River, NJ | Thrift | $ | 1,989 | 23 | 12-31 | 07/96 | $ | 10.00 | $ | 188 | |||||||||||||||||||||
ESBF
|
ESB Financial Corp. of PA | NASDAQ | Ellwood City, PA | Thrift | $ | 1,979 | S | 23 | 12-31 | 06/90 | $ | 12.32 | $ | 149 | ||||||||||||||||||||
PVSA
|
Parkvale Financial Corp. of PA | NASDAQ | Monroeville, PA | Thrift | $ | 1,916 | 48 | 06-30 | 07/87 | $ | 7.30 | $ | 40 | |||||||||||||||||||||
UBNK
|
United Financial Bancorp of MA | NASDAQ | W. Springfield, MA | Thrift | $ | 1,247 | S | 13 | 12-31 | 12/07 | $ | 13.43 | $ | 226 | ||||||||||||||||||||
WFD
|
Westfield Financial Inc. of MA | NASDAQ | Westfield, MA | Thrift | $ | 1,191 | 11 | 12-31 | 01/07 | $ | 8.34 | $ | 249 | |||||||||||||||||||||
BFED
|
Beacon Federal Bancorp of NY | NASDAQ | E. Syracuse, NY | Thrift | $ | 1,070 | S | 8 | 12-31 | 10/07 | $ | 8.62 | $ | 56 | ||||||||||||||||||||
ESSA
|
ESSA Bancorp, Inc. of PA | NASDAQ | Stroudsburg, PA | Thrift | $ | 1,034 | 13 | 09-30 | 04/07 | $ | 11.62 | $ | 164 |
NOTES:
|
(1 | ) | Operating strategies are: Thrift=Traditional Thrift, M.B.=Mortgage Banker, R.E.=Real Estate Developer, Div.=Diversified and Ret.=Retail Banking. | |||
|
||||||
|
(2 | ) | Most recent quarter end available (E=Estimated and P=Pro Forma). |
RP ® Financial, LC. | PEER GROUP ANALYSIS | |
III.4 |
o | Beacon Federal Bancorp of New York. Selected due to similar interest-bearing funding composition, similar net interest margin, similar earnings contribution from non-interest operating income and relatively low level of operating expenses. | |
o | Brookline Bancorp, Inc. of Massachusetts. Selected due to second-step conversion completed in 2002, relatively high equity-to-assets ratio, similar interest-bearing funding composition, relatively low level of operating expenses, comparable concentration of 1-4 family loans and mortgage-backed securities comprising assets and lending diversification emphasis on commercial real estate loans. | |
o | Danvers Bancorp, Inc. of Massachusetts. Selected due to comparable asset size, similar interest-earning asset composition, similar earnings contribution from non-interest operating income, comparable concentration of 1-4 family loans and mortgage-backed securities comprising assets and lending diversification emphasis on commercial real estate loans. | |
o | ESB Financial Corp. of Pennsylvania. Selected due to comparable asset size, comparable size of branch network, similar earnings contribution from non-interest operating income and relatively low level of operating expenses. | |
o | ESSA Bancorp, Inc. of Pennsylvania. Selected due to relatively high equity-to-assets ratio, similar interest-earning asset composition, comparable net interest margin and lending diversification emphasis on commercial real estate loans. | |
o | OceanFirst Financial Corp. of New Jersey. Selected due to New Jersey market area, comparable size of branch network, comparable asset size and lending diversification emphasis on commercial real estate loans. | |
o | Parkvale Financial Corp. of Pennsylvania. Selected due to comparable asset size, similar concentration of assets maintained in investments and lending diversification emphasis on commercial real estate loans. | |
o | Provident New York Bancorp, Inc. of New York. Selected due to completed second-step conversion in 2004, similar concentration of assets maintained in investments and lending diversification emphasis on commercial real estate loans. | |
o | United Financial Bancorp of Massachusetts. Selected due to completed second-step conversion in 2007, relatively high equity-to-assets ratio, similar interest-earning asset composition, comparable net interest margin, comparable return |
RP ® Financial, LC. | PEER GROUP ANALYSIS | |
III.5 |
on average assets and lending diversification emphasis on commercial real estate loans. | ||
o | Westfield Financial, Inc. of Massachusetts. Selected due to completed second-step conversion in 2007, relatively high equity-to-assets ratio, comparable return on average assets, similar net interest margin, similar earnings contribution from non-interest operating income and lending diversification emphasis on commercial real estate loans. |
All | ||||||||
Publicly-Traded | Peer Group | |||||||
Financial Characteristics (Averages)
|
||||||||
Assets ($Mil)
|
$ | 3,023 | $ | 1,846 | ||||
Market capitalization ($Mil)
|
$ | 348 | $ | 228 | ||||
Tangible equity/assets (%)
|
10.70 | % | 12.30 | % | ||||
Core return on average assets (%)
|
(0.26 | ) | 0.54 | |||||
Core return on average equity (%)
|
(1.67 | ) | 4.51 | |||||
|
||||||||
Pricing Ratios (Averages)(1)
|
||||||||
Core price/earnings (x)
|
18.45x | 22.10x | ||||||
Price/tangible book (%)
|
78.47 | % | 100.03 | % | ||||
Price/assets (%)
|
8.00 | 12.47 |
(1) | Based on market prices as of February 19, 2010. |
RP ® Financial, LC. | PEER GROUP ANALYSIS | |
III.6 |
RP ® Financial, LC. | PEER GROUP ANALYSIS | |
III.7 |
Balance Sheet as a Percent of Assets | Balance Sheet Annual Growth Rates | Regulatory Capital | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Cash & | MBS & | Borrowed | Subd. | Net | Goodwill | Tng Net | MBS, Cash & | Borrows. | Net | Tng Net | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Equivalents | Invest | BOLI | Loans | Deposits | Funds | Debt | Worth | & Intang | Worth | Assets | Investments | Loans | Deposits | &Subdebt | Worth | Worth | Tangible | Core | Reg.Cap. | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Oritani Financial Corp.
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
December 31, 2009
|
1.3 | % | 26.4 | % | 1.5 | % | 67.6 | % | 60.3 | % | 25.3 | % | 0.0 | % | 12.4 | % | 0.0 | % | 12.4 | % | 21.25 | % | 48.25 | % | 12.78 | % | 37.57 | % | 3.24 | % | 0.24 | % | 0.24 | % | 9.76 | % | 9.76 | % | 14.75 | % | ||||||||||||||||||||||||||||||||||||||||
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
All Public Companies
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Averages
|
4.6 | % | 20.5 | % | 1.4 | % | 68.7 | % | 70.8 | % | 16.1 | % | 0.5 | % | 11.5 | % | 0.8 | % | 10.7 | % | 5.86 | % | 14.50 | % | 3.10 | % | 13.11 | % | -15.29 | % | 3.52 | % | 3.93 | % | 10.03 | % | 9.92 | % | 16.39 | % | ||||||||||||||||||||||||||||||||||||||||
Medians
|
3.6 | % | 18.4 | % | 1.4 | % | 69.9 | % | 71.7 | % | 14.5 | % | 0.0 | % | 10.3 | % | 0.0 | % | 9.4 | % | 3.77 | % | 8.90 | % | 1.30 | % | 10.15 | % | -14.95 | % | 1.10 | % | 1.01 | % | 9.25 | % | 9.18 | % | 13.90 | % | ||||||||||||||||||||||||||||||||||||||||
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
State of NJ
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Averages
|
2.7 | % | 26.2 | % | 1.3 | % | 65.7 | % | 70.2 | % | 16.7 | % | 0.3 | % | 11.9 | % | 0.5 | % | 11.3 | % | 10.54 | % | 16.96 | % | 7.04 | % | 21.49 | % | -15.16 | % | -1.01 | % | -0.02 | % | 11.33 | % | 11.33 | % | 24.53 | % | ||||||||||||||||||||||||||||||||||||||||
Medians
|
2.1 | % | 21.0 | % | 1.5 | % | 70.8 | % | 70.8 | % | 14.2 | % | 0.0 | % | 10.6 | % | 0.0 | % | 9.7 | % | 9.99 | % | 15.45 | % | 5.85 | % | 18.89 | % | -13.37 | % | 0.24 | % | 0.24 | % | 10.72 | % | 10.72 | % | 19.71 | % | ||||||||||||||||||||||||||||||||||||||||
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Comparable Group
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Averages
|
2.5 | % | 28.8 | % | 1.6 | % | 63.2 | % | 61.6 | % | 23.5 | % | 0.5 | % | 13.5 | % | 1.3 | % | 12.3 | % | 6.86 | % | 4.61 | % | 4.56 | % | 13.62 | % | -4.00 | % | 3.67 | % | 3.97 | % | 9.74 | % | 9.74 | % | 13.97 | % | ||||||||||||||||||||||||||||||||||||||||
Medians
|
2.0 | % | 24.0 | % | 1.5 | % | 68.3 | % | 63.9 | % | 20.0 | % | 0.0 | % | 12.9 | % | 0.7 | % | 9.7 | % | 1.18 | % | 3.96 | % | 0.48 | % | 8.63 | % | -4.15 | % | -0.90 | % | -0.66 | % | 9.25 | % | 9.25 | % | 13.97 | % | ||||||||||||||||||||||||||||||||||||||||
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Comparable Group
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
BFED Beacon Federal Bancorp of NY (1)
|
1.1 | % | 19.2 | % | 1.0 | % | 76.1 | % | 63.7 | % | 26.5 | % | 0.0 | % | 9.4 | % | 0.0 | % | 9.4 | % | 6.07 | % | -0.70 | % | 6.56 | % | 15.15 | % | -8.98 | % | 0.10 | % | 0.10 | % | NA | NA | NA | |||||||||||||||||||||||||||||||||||||||||||
BRKL Brookline Bancorp, Inc. of MA
|
2.5 | % | 12.6 | % | 0.0 | % | 81.5 | % | 62.5 | % | 17.9 | % | 0.0 | % | 18.7 | % | 1.8 | % | 16.9 | % | 0.11 | % | -12.04 | % | 2.69 | % | 20.64 | % | -36.43 | % | -0.90 | % | -0.66 | % | NA | NA | NA | |||||||||||||||||||||||||||||||||||||||||||
DNBK Danvers Bancorp, Inc. of MA
|
3.3 | % | 24.4 | % | 1.3 | % | 66.1 | % | 70.6 | % | 15.7 | % | 1.2 | % | 11.4 | % | 1.5 | % | 10.0 | % | 44.68 | % | 26.43 | % | 49.38 | % | 57.90 | % | 16.61 | % | 22.60 | % | 6.94 | % | 12.13 | % | 12.13 | % | 15.68 | % | ||||||||||||||||||||||||||||||||||||||||
ESBF ESB Financial Corp. of PA (1)
|
1.8 | % | 57.7 | % | 1.5 | % | 33.8 | % | 46.8 | % | 41.2 | % | 2.3 | % | 8.5 | % | 2.2 | % | 6.3 | % | 0.87 | % | 3.96 | % | -1.61 | % | 6.13 | % | -8.01 | % | 32.30 | % | 49.97 | % | NA | NA | NA | |||||||||||||||||||||||||||||||||||||||||||
ESSA ESSA Bancorp, Inc. of PA
|
2.1 | % | 23.3 | % | 1.5 | % | 70.6 | % | 38.7 | % | 42.7 | % | 0.0 | % | 17.6 | % | 0.0 | % | 17.6 | % | 0.12 | % | -5.20 | % | 1.59 | % | 7.05 | % | -2.79 | % | -6.13 | % | -6.13 | % | NA | NA | NA | |||||||||||||||||||||||||||||||||||||||||||
OCFC OceanFirst Financial Corp. of NJ
|
1.2 | % | 11.5 | % | 2.0 | % | 82.2 | % | 68.6 | % | 20.0 | % | 1.4 | % | 9.2 | % | 0.0 | % | 9.2 | % | 7.07 | % | NM | -1.05 | % | 7.07 | % | -5.50 | % | NM | NM | NA | NA | NA | ||||||||||||||||||||||||||||||||||||||||||||||
PVSA Parkvale Financial Corp. of PA
|
7.7 | % | 31.3 | % | 1.3 | % | 55.0 | % | 79.8 | % | 11.8 | % | 0.0 | % | 7.9 | % | 1.5 | % | 6.4 | % | 1.36 | % | 19.30 | % | -9.53 | % | 3.13 | % | -2.45 | % | -7.20 | % | -8.13 | % | 7.83 | % | 7.83 | % | 12.25 | % | ||||||||||||||||||||||||||||||||||||||||
PBNY Provident NY Bancorp, Inc. of NY
|
1.4 | % | 31.7 | % | 1.7 | % | 56.5 | % | 64.1 | % | 20.0 | % | 0.0 | % | 14.4 | % | 5.7 | % | 8.7 | % | -0.13 | % | 5.37 | % | -4.36 | % | -1.50 | % | 3.21 | % | 0.80 | % | 2.18 | % | 9.25 | % | 9.25 | % | NA | |||||||||||||||||||||||||||||||||||||||||
UBNK United Financial Bancorp of MA (1)
|
1.1 | % | 23.5 | % | 2.3 | % | 70.5 | % | 67.4 | % | 14.5 | % | 0.0 | % | 17.3 | % | 0.0 | % | 17.3 | % | 1.00 | % | -10.11 | % | 2.60 | % | 10.44 | % | -24.93 | % | -3.69 | % | -3.68 | % | NA | NA | NA | |||||||||||||||||||||||||||||||||||||||||||
WFD Westfield Financial Inc. of MA
|
2.4 | % | 52.4 | % | 3.2 | % | 39.4 | % | 54.4 | % | 24.2 | % | 0.0 | % | 20.8 | % | 0.0 | % | 20.8 | % | 7.43 | % | 14.44 | % | -0.63 | % | 10.19 | % | 29.23 | % | -4.86 | % | -4.86 | % | NA | NA | NA |
(1) | Financial information is for the quarter ending September 30, 2009. |
RP ® Financial, LC. | PEER GROUP ANALYSIS | |
III.8 |
RP ® Financial, LC. | PEER GROUP ANALYSIS | |
III.9 |
RP ® Financial, LC. | PEER GROUP ANALYSIS | |
III.10 |
Net Interest Income | Other Income | G&A/Other Exp. | Non-Op. Items | Yields, Costs, and Spreads | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Loss | NII | Total | MEMO: | MEMO: | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Net | Provis. | After | Loan | R.E. | Other | Other | G&A | Goodwill | Net | Extrao. | Yield | Cost | Yld-Cost | Assets/ | Effective | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Income | Income | Expense | NII | on IEA | Provis. | Fees | Oper. | Income | Income | Expense | Amort. | Gains | Items | On Assets | Of Funds | Spread | FTE Emp. | Tax Rate | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Oritani Financial Corp.
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
December 31, 2009
|
0.56 | % | 5.19 | % | 2.46 | % | 2.72 | % | 0.51 | % | 2.22 | % | 0.00 | % | 0.13 | % | 0.14 | % | 0.27 | % | 1.59 | % | 0.00 | % | 0.03 | % | 0.00 | % | 5.42 | % | 2.87 | % | 2.55 | % | $ | 11,338 | 40.22 | % | ||||||||||||||||||||||||||||||||||||||
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
All Public Companies
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Averages
|
-0.08 | % | 4.99 | % | 2.09 | % | 2.90 | % | 0.83 | % | 2.07 | % | 0.02 | % | -0.06 | % | 0.79 | % | 0.76 | % | 2.70 | % | 0.11 | % | -0.07 | % | 0.03 | % | 5.30 | % | 2.41 | % | 2.89 | % | $ | 6,084 | 31.69 | % | ||||||||||||||||||||||||||||||||||||||
Medians
|
0.28 | % | 5.00 | % | 2.04 | % | 2.91 | % | 0.44 | % | 2.37 | % | 0.00 | % | 0.00 | % | 0.58 | % | 0.57 | % | 2.69 | % | 0.00 | % | 0.00 | % | 0.00 | % | 5.29 | % | 2.42 | % | 2.92 | % | $ | 4,789 | 32.16 | % | ||||||||||||||||||||||||||||||||||||||
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
State of NJ
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Averages
|
-0.18 | % | 4.85 | % | 2.18 | % | 2.67 | % | 0.38 | % | 2.29 | % | 0.00 | % | 0.00 | % | 0.33 | % | 0.33 | % | 1.97 | % | 0.24 | % | -0.35 | % | 0.00 | % | 5.17 | % | 2.59 | % | 2.58 | % | $ | 12,203 | 33.08 | % | ||||||||||||||||||||||||||||||||||||||
Medians
|
0.25 | % | 4.80 | % | 1.99 | % | 2.71 | % | 0.24 | % | 2.25 | % | 0.00 | % | 0.00 | % | 0.26 | % | 0.26 | % | 2.03 | % | 0.00 | % | -0.06 | % | 0.00 | % | 5.19 | % | 2.44 | % | 2.46 | % | $ | 7,519 | 33.96 | % | ||||||||||||||||||||||||||||||||||||||
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Comparable Group
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Averages
|
0.49 | % | 4.85 | % | 2.04 | % | 2.82 | % | 0.35 | % | 2.46 | % | 0.01 | % | -0.02 | % | 0.53 | % | 0.52 | % | 2.13 | % | 0.02 | % | -0.11 | % | 0.00 | % | 5.12 | % | 2.39 | % | 2.74 | % | $ | 5,335 | 25.74 | % | ||||||||||||||||||||||||||||||||||||||
Medians
|
0.56 | % | 4.94 | % | 1.95 | % | 2.93 | % | 0.32 | % | 2.59 | % | 0.00 | % | 0.00 | % | 0.49 | % | 0.53 | % | 2.32 | % | 0.00 | % | -0.04 | % | 0.00 | % | 5.17 | % | 2.41 | % | 2.74 | % | $ | 5,444 | 28.99 | % | ||||||||||||||||||||||||||||||||||||||
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Comparable Group
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
BFED Beacon Federal Bancorp of NY (1)
|
0.60 | % | 5.37 | % | 2.74 | % | 2.63 | % | 0.85 | % | 1.78 | % | 0.00 | % | 0.00 | % | 0.49 | % | 0.49 | % | 1.60 | % | 0.00 | % | -0.17 | % | 0.00 | % | 5.55 | % | 3.05 | % | 2.49 | % | NM | NM | ||||||||||||||||||||||||||||||||||||||||
BRKL Brookline Bancorp, Inc. of MA
|
0.75 | % | 5.29 | % | 2.05 | % | 3.25 | % | 0.37 | % | 2.88 | % | 0.00 | % | 0.00 | % | 0.10 | % | 0.10 | % | 1.62 | % | 0.06 | % | 0.01 | % | 0.00 | % | 5.47 | % | 2.55 | % | 2.92 | % | NM | 39.16 | % | |||||||||||||||||||||||||||||||||||||||
DNBK Danvers Bancorp, Inc. of MA
|
0.27 | % | 4.88 | % | 1.84 | % | 3.05 | % | 0.26 | % | 2.78 | % | 0.01 | % | -0.04 | % | 0.47 | % | 0.43 | % | 2.89 | % | 0.00 | % | 0.00 | % | 0.00 | % | 5.12 | % | 2.12 | % | 3.01 | % | NM | 2.38 | % | |||||||||||||||||||||||||||||||||||||||
ESBF ESB Financial Corp. of PA (1)
|
0.60 | % | 4.78 | % | 2.93 | % | 1.85 | % | 0.06 | % | 1.78 | % | 0.00 | % | 0.00 | % | 0.33 | % | 0.33 | % | 1.24 | % | 0.03 | % | -0.09 | % | 0.00 | % | 5.14 | % | 3.21 | % | 1.93 | % | NM | 14.58 | % | |||||||||||||||||||||||||||||||||||||||
ESSA ESSA Bancorp, Inc. of PA
|
0.53 | % | 5.00 | % | 2.19 | % | 2.81 | % | 0.16 | % | 2.65 | % | 0.05 | % | -0.12 | % | 0.72 | % | 0.65 | % | 2.53 | % | 0.00 | % | 0.02 | % | 0.00 | % | 5.20 | % | 2.71 | % | 2.49 | % | $ | 5,809 | 28.99 | % | ||||||||||||||||||||||||||||||||||||||
OCFC OceanFirst Financial Corp. of NJ
|
0.82 | % | 5.02 | % | 1.59 | % | 3.43 | % | 0.30 | % | 3.13 | % | 0.00 | % | 0.00 | % | 0.77 | % | 0.77 | % | 2.54 | % | 0.00 | % | 0.05 | % | 0.00 | % | 5.28 | % | 1.75 | % | 3.53 | % | NM | 33.96 | % | |||||||||||||||||||||||||||||||||||||||
PVSA Parkvale Financial Corp. of PA
|
-0.50 | % | 4.35 | % | 2.33 | % | 2.02 | % | 0.38 | % | 1.64 | % | 0.08 | % | 0.00 | % | 0.49 | % | 0.57 | % | 1.49 | % | 0.05 | % | -1.33 | % | 0.00 | % | 4.60 | % | 2.55 | % | 2.05 | % | $ | 4,754 | 30.59 | % | ||||||||||||||||||||||||||||||||||||||
PBNY Provident NY Bancorp, Inc. of NY
|
0.88 | % | 4.31 | % | 1.18 | % | 3.13 | % | 0.60 | % | 2.53 | % | 0.00 | % | 0.00 | % | 0.76 | % | 0.76 | % | 2.64 | % | 0.07 | % | 0.66 | % | 0.00 | % | 4.78 | % | 1.39 | % | 3.39 | % | $ | 5,444 | 27.04 | % | ||||||||||||||||||||||||||||||||||||||
UBNK United Financial Bancorp of MA (1)
|
0.45 | % | 5.06 | % | 1.85 | % | 3.21 | % | 0.19 | % | 3.02 | % | 0.00 | % | 0.00 | % | 0.75 | % | 0.75 | % | 2.60 | % | 0.00 | % | -0.20 | % | 0.00 | % | 5.29 | % | 2.26 | % | 3.02 | % | NM | 37.32 | % | |||||||||||||||||||||||||||||||||||||||
WFD Westfield Financial Inc. of MA
|
0.47 | % | 4.49 | % | 1.71 | % | 2.78 | % | 0.33 | % | 2.44 | % | 0.00 | % | -0.01 | % | 0.39 | % | 0.38 | % | 2.12 | % | 0.00 | % | -0.10 | % | 0.00 | % | 4.82 | % | 2.27 | % | 2.55 | % | NM | 17.65 | % |
(1) | Financial information is for the quarter ending September 30, 2009. |
RP ® Financial, LC. | PEER GROUP ANALYSIS | |
III.11 |
RP ® Financial, LC. | PEER GROUP ANALYSIS | |
III.12 |
RP ® Financial, LC. | PEER GROUP ANALYSIS | |
III.13 |
Portfolio Composition as a Percent of Assets | ||||||||||||||||||||||||||||||||||||
1-4 | Constr. | 5+Unit | Commerc. | RWA/ | Serviced | Servicing | ||||||||||||||||||||||||||||||
Institution | MBS | Family | & Land | Comm RE | Business | Consumer | Assets | For Others | Assets | |||||||||||||||||||||||||||
(%) | (%) | (%) | (%) | (%) | (%) | (%) | ($000) | ($000) | ||||||||||||||||||||||||||||
Oritani Financial Corp.
|
9.20 | % | 12.96 | % | 6.22 | % | 46.08 | % | 1.06 | % | 2.56 | % | 72.52 | % | $ | 9,870 | $ | 0 | ||||||||||||||||||
|
||||||||||||||||||||||||||||||||||||
All Public Companies
|
||||||||||||||||||||||||||||||||||||
Averages
|
12.62 | % | 35.14 | % | 5.41 | % | 22.14 | % | 4.63 | % | 2.40 | % | 66.10 | % | $ | 605,349 | $ | 5,591 | ||||||||||||||||||
Medians
|
10.44 | % | 35.37 | % | 4.11 | % | 20.03 | % | 3.48 | % | 0.66 | % | 66.52 | % | $ | 43,890 | $ | 125 | ||||||||||||||||||
|
||||||||||||||||||||||||||||||||||||
State of NJ
|
||||||||||||||||||||||||||||||||||||
Averages
|
15.75 | % | 44.32 | % | 3.74 | % | 16.80 | % | 2.49 | % | 0.47 | % | 57.93 | % | $ | 150,398 | $ | 1,069 | ||||||||||||||||||
Medians
|
10.44 | % | 43.25 | % | 2.70 | % | 16.21 | % | 1.03 | % | 0.10 | % | 58.55 | % | $ | 4,505 | $ | 0 | ||||||||||||||||||
|
||||||||||||||||||||||||||||||||||||
Comparable Group
|
||||||||||||||||||||||||||||||||||||
Averages
|
19.33 | % | 33.01 | % | 2.62 | % | 17.66 | % | 7.38 | % | 4.64 | % | 64.45 | % | $ | 158,995 | $ | 940 | ||||||||||||||||||
Medians
|
15.07 | % | 30.50 | % | 2.09 | % | 17.44 | % | 8.74 | % | 1.26 | % | 65.38 | % | $ | 70,785 | $ | 318 | ||||||||||||||||||
|
||||||||||||||||||||||||||||||||||||
Comparable Group
|
||||||||||||||||||||||||||||||||||||
BFED Beacon Federal Bancorp of NY (1)
|
15.17 | % | 37.21 | % | 2.69 | % | 12.44 | % | 9.33 | % | 15.88 | % | 75.28 | % | $ | 116,970 | $ | 800 | ||||||||||||||||||
BRKL Brookline Bancorp, Inc. of MA
|
5.74 | % | 14.81 | % | 0.69 | % | 34.44 | % | 11.39 | % | 21.42 | % | 83.30 | % | $ | 37,470 | $ | 148 | ||||||||||||||||||
DNBK Danvers Bancorp, Inc. of MA
|
12.38 | % | 16.08 | % | 4.95 | % | 25.87 | % | 14.63 | % | 0.26 | % | 54.63 | % | $ | 104,290 | $ | 427 | ||||||||||||||||||
ESBF ESB Financial Corp. of PA (1)
|
40.28 | % | 20.42 | % | 1.98 | % | 6.12 | % | 1.31 | % | 3.52 | % | 49.29 | % | $ | 9,280 | $ | 29 | ||||||||||||||||||
ESSA ESSA Bancorp, Inc. of PA
|
16.53 | % | 63.14 | % | 0.83 | % | 5.15 | % | 1.88 | % | 0.18 | % | 47.86 | % | $ | 43,890 | $ | 323 | ||||||||||||||||||
OCFC OceanFirst Financial Corp. of NJ
|
8.69 | % | 59.96 | % | 2.20 | % | 16.98 | % | 3.51 | % | 0.03 | % | 65.70 | % | $ | 961,440 | $ | 6,515 | ||||||||||||||||||
PVSA Parkvale Financial Corp. of PA
|
13.48 | % | 42.70 | % | 0.66 | % | 7.59 | % | 2.27 | % | 2.25 | % | 68.84 | % | $ | 60,560 | $ | 0 | ||||||||||||||||||
PBNY Provident NY Bancorp, Inc. of NY
|
14.98 | % | 23.79 | % | 6.75 | % | 19.02 | % | 8.30 | % | 0.56 | % | 65.06 | % | $ | 163,620 | $ | 840 | ||||||||||||||||||
UBNK United Financial Bancorp of MA (1)
|
22.80 | % | 43.26 | % | 4.67 | % | 31.07 | % | 9.18 | % | 1.96 | % | 70.73 | % | $ | 81,010 | $ | 313 | ||||||||||||||||||
WFD Westfield Financial Inc. of MA
|
43.22 | % | 8.72 | % | 0.74 | % | 17.90 | % | 11.99 | % | 0.30 | % | 63.82 | % | $ | 11,420 | $ | 0 |
(1) | Financial information is for the quarter ending September 30, 2009. |
Source: | SNL Financial LC. and RP ® Financial, LC. calculations. The information provided in this table has been obtained from sources we believe are reliable, but we cannot guarantee the accuracy or completeness of such information. |
RP ® Financial, LC. | PEER GROUP ANALYSIS | |
III.14 |
RP ® Financial, LC. | PEER GROUP ANALYSIS | |
III.15 |
Balance Sheet Measures | ||||||||||||||||||||||||||||||||||||
Non-Earn. | ||||||||||||||||||||||||||||||||||||
Equity/ | IEA/ | Assets/ | Quarterly Change in Net Interest Income | |||||||||||||||||||||||||||||||||
Institution | Assets | IBL | Assets | 12/31/2009 | 9/30/2009 | 6/30/2009 | 3/31/2009 | 12/31/2008 | 9/30/2008 | |||||||||||||||||||||||||||
(%) | (%) | (%) | (change in net interest income is annualized in basis points) | |||||||||||||||||||||||||||||||||
Oritani Financial Corp.
|
12.4 | % | 111.3 | % | 4.7 | % | -3 | 40 | 1 | -15 | -21 | 38 | ||||||||||||||||||||||||
|
||||||||||||||||||||||||||||||||||||
All Public Companies
|
10.5 | % | 106.8 | % | 6.1 | % | 6 | 8 | 1 | -4 | -3 | 10 | ||||||||||||||||||||||||
State of NJ
|
11.1 | % | 108.6 | % | 5.7 | % | 6 | 17 | -1 | -6 | -1 | 15 | ||||||||||||||||||||||||
|
||||||||||||||||||||||||||||||||||||
Comparable Group
|
||||||||||||||||||||||||||||||||||||
Averages
|
12.3 | % | 110.6 | % | 5.6 | % | 8 | 3 | 4 | -6 | -5 | 10 | ||||||||||||||||||||||||
Medians
|
9.7 | % | 107.1 | % | 5.5 | % | 1 | 2 | 6 | -7 | -7 | 11 | ||||||||||||||||||||||||
|
||||||||||||||||||||||||||||||||||||
Comparable Group
|
||||||||||||||||||||||||||||||||||||
BFED Beacon Federal Bancorp of NY (1)
|
9.4 | % | 106.9 | % | 3.6 | % | NA | 5 | 5 | 9 | -21 | 22 | ||||||||||||||||||||||||
BRKL Brookline Bancorp, Inc. of MA
|
16.9 | % | 120.3 | % | 3.3 | % | 14 | -2 | 40 | -18 | 5 | 16 | ||||||||||||||||||||||||
DNBK Danvers Bancorp, Inc. of MA
|
10.0 | % | 107.3 | % | 6.1 | % | 44 | 12 | 6 | -17 | -1 | -15 | ||||||||||||||||||||||||
ESBF ESB Financial Corp. of PA (1)
|
6.3 | % | 103.3 | % | 6.7 | % | NA | 10 | 10 | 5 | 4 | 11 | ||||||||||||||||||||||||
ESSA ESSA Bancorp, Inc. of PA
|
17.6 | % | 117.9 | % | 4.0 | % | 0 | -2 | 6 | 1 | -6 | 3 | ||||||||||||||||||||||||
OCFC OceanFirst Financial Corp. of NJ
|
9.2 | % | 105.5 | % | 5.1 | % | -2 | 15 | 6 | 13 | 7 | 8 | ||||||||||||||||||||||||
PVSA Parkvale Financial Corp. of PA
|
6.4 | % | 102.6 | % | 6.0 | % | -5 | -17 | 3 | -19 | -8 | 18 | ||||||||||||||||||||||||
PBNY Provident NY Bancorp, Inc. of NY
|
8.7 | % | 106.5 | % | 10.4 | % | 1 | -7 | -7 | -17 | -11 | 11 | ||||||||||||||||||||||||
UBNK United Financial Bancorp of MA (1)
|
17.3 | % | 116.2 | % | 4.9 | % | NA | 13 | -17 | -7 | -13 | 18 | ||||||||||||||||||||||||
WFD Westfield Financial Inc. of MA
|
20.8 | % | 119.9 | % | 5.8 | % | 4 | -1 | -14 | -6 | -9 | 5 |
(1) | Financial information is for the quarter ending September 30, 2009. |
Source: | SNL Financial LC. and RP ® Financial, LC. calculations. The information provided in this table has been obtained from sources we believe are reliable, but we cannot guarantee the accuracy or completeness of such information. |
RP ® Financial, LC. | PEER GROUP ANALYSIS | |
III.16 |
RP ® Financial, LC. | PEER GROUP ANALYSIS | |
III.17 |
NPAs & | Rsrves/ | |||||||||||||||||||||||||||||||
REO/ | 90+Del/ | NPLs/ | Rsrves/ | Rsrves/ | NPAs & | Net Loan | NLCs/ | |||||||||||||||||||||||||
Institution | Assets | Assets | Loans | Loans | NPLs | 90+Del | Chargoffs | Loans | ||||||||||||||||||||||||
(%) | (%) | (%) | (%) | (%) | (%) | ($000) | (%) | |||||||||||||||||||||||||
Oritani Financial corp.
|
0.03 | % | 2.62 | % | 3.82 | % | 1.63 | % | 42.70 | % | 42.21 | % | $ | 6,299 | 0.46 | % | ||||||||||||||||
|
||||||||||||||||||||||||||||||||
All Public Companies
|
||||||||||||||||||||||||||||||||
Averages
|
0.43 | % | 3.16 | % | 3.37 | % | 1.50 | % | 67.54 | % | 50.08 | % | $ | 1,404 | 0.62 | % | ||||||||||||||||
Medians
|
0.17 | % | 2.33 | % | 2.78 | % | 1.28 | % | 53.91 | % | 41.00 | % | $ | 388 | 0.17 | % | ||||||||||||||||
|
||||||||||||||||||||||||||||||||
State of NJ
|
||||||||||||||||||||||||||||||||
Averages
|
0.19 | % | 0.98 | % | 1.64 | % | 0.93 | % | 70.06 | % | 74.67 | % | $ | 1,786 | 0.28 | % | ||||||||||||||||
Medians
|
0.02 | % | 0.89 | % | 1.72 | % | 0.77 | % | 51.99 | % | 52.94 | % | $ | 215 | 0.10 | % | ||||||||||||||||
|
||||||||||||||||||||||||||||||||
Comparable Group
|
||||||||||||||||||||||||||||||||
Averages
|
0.10 | % | 1.16 | % | 1.42 | % | 1.32 | % | 130.87 | % | 77.84 | % | $ | 1,330 | 0.50 | % | ||||||||||||||||
Medians
|
0.09 | % | 1.01 | % | 1.23 | % | 1.44 | % | 112.32 | % | 80.64 | % | $ | 1,450 | 0.43 | % | ||||||||||||||||
|
||||||||||||||||||||||||||||||||
Comparable Group
|
||||||||||||||||||||||||||||||||
BFED Beacon Federal Bancorp of NY (1)
|
0.00 | % | NA | NA | 1.88 | % | NA | NA | $ | 1,600 | 0.77 | % | ||||||||||||||||||||
BRKL Brookline Bancorp, Inc. of MA
|
0.00 | % | NA | 0.47 | % | 1.44 | % | 306.81 | % | NA | $ | 1,673 | 0.31 | % | ||||||||||||||||||
DNBK Danvers Bancorp, Inc. of MA
|
0.06 | % | 0.73 | % | 1.01 | % | 0.88 | % | 87.49 | % | 80.64 | % | $ | 929 | 0.25 | % | ||||||||||||||||
ESBF ESB Financial Corp. of PA (1)
|
0.00 | % | NA | NA | NA | NA | NA | $ | 192 | 0.00 | % | |||||||||||||||||||||
ESSA ESSA Bancorp, Inc. of PA
|
0.17 | % | NA | NA | 0.84 | % | NA | NA | $ | 111 | 0.06 | % | ||||||||||||||||||||
OCFC OceanFirst Financial Corp. of NJ
|
0.13 | % | 1.55 | % | 1.72 | % | 0.89 | % | 51.99 | % | 47.60 | % | $ | 1,157 | 0.28 | % | ||||||||||||||||
PVSA Parkvale Financial Corp. of PA
|
0.31 | % | 1.90 | % | 2.84 | % | 1.76 | % | 62.00 | % | 52.01 | % | $ | 1,999 | 0.74 | % | ||||||||||||||||
PBNY Provident NY Bancorp, Inc. of NY
|
0.08 | % | 1.01 | % | 1.30 | % | 1.79 | % | 137.14 | % | 101.77 | % | $ | 2,583 | 0.61 | % | ||||||||||||||||
UBNK United Financial Bancorp of MA (1)
|
0.10 | % | NA | NA | 0.82 | % | NA | NA | $ | 1,300 | 0.54 | % | ||||||||||||||||||||
WFD Westfield Financial Inc. of MA
|
0.14 | % | 0.60 | % | 1.15 | % | 1.60 | % | 139.76 | % | 107.19 | % | $ | 1,752 | 1.47 | % |
(1) | Financial information is for the quarter ending September 30, 2009. |
Source: | SNL Financial LC. and RP ® Financial, LC. calculations. The information provided in this table has been obtained from sources we believe are reliable, but we cannot guarantee the accuracy or completeness of such information. |
RP ® Financial, LC. Financial, LC. | VALUATION ANALYSIS | |
IV.1 |
RP ® Financial, LC. Financial, LC. | VALUATION ANALYSIS | |
IV.2 |
RP ® Financial, LC. Financial, LC. | VALUATION ANALYSIS | |
IV.3 |
§ | Overall A/L Composition . In comparison to the Peer Group, the Companys interest-earning asset composition showed a higher concentration of loans and a lower higher concentration of investments. The Companys lending emphasis on commercial real estate/multi-family translated into greater diversification into higher risk and higher yielding types of loans. Overall, in comparison to the Peer Group, the Companys interest-earning asset composition provided for a higher yield earned on interest-earning assets and a higher risk weighted assets-to-assets ratio. Oritani Financials funding composition reflected a slightly lower level of deposits and a slightly higher level of borrowings than the comparable Peer Group ratios, which translated into a higher cost of funds for the Company. Overall, as a percent of assets, the Company maintained a slightly higher level of interest-earning assets and a similar level of interest-bearing liabilities compared to the Peer Groups ratios, which resulted in a slightly higher IEA/IBL ratio for the Company. After factoring in the impact of the net stock proceeds, the Companys IEA/IBL ratio should further exceed the Peer Groups ratio. On balance, RP Financial concluded that asset/liability composition was a slightly positive factor in our adjustment for financial condition. | ||
§ | Credit Quality. The Companys ratios for non-performing assets and non-performing loans were less favorable than the comparable Peer Group ratios. Loss reserves as a percent of non-performing loans were lower for the Company, while the Company maintained slightly higher loss reserves as a percent of loans. Net loan charge-offs were a similar factor for the Company and the Peer Group. As noted above, the Companys risk weighted assets-to-assets ratio was higher than the Peer Groups ratio. Overall, RP Financial concluded that credit quality was a moderate negative factor in our adjustment for financial condition. |
RP ® Financial, LC. Financial, LC. | VALUATION ANALYSIS | |
IV.4 |
§ | Balance Sheet Liquidity . The Company operated with a slightly lower level of cash and investment securities relative to the Peer Group (27.7% of assets versus 31.3% for the Peer Group). Following the infusion of stock proceeds, the Companys cash and investments ratio is expected to increase as the proceeds retained at the holding company level will be initially deployed into investments. The Companys future borrowing capacity was considered to be slightly less than the Peer Groups, given the slightly higher level of borrowings currently funding the Companys assets. Overall, RP Financial concluded that balance sheet liquidity was a neutral factor in our adjustment for financial condition. | ||
§ | Funding Liabilities . The Companys interest-bearing funding composition reflected a slightly lower concentration of deposits and a slightly higher concentration of borrowings relative to the comparable Peer Group ratios, which translated into a higher cost of funds for the Company. Total interest-bearing liabilities as a percent of assets were similar for the Company and the Peer Group. Following the stock offering, the increase in the Companys capital position will reduce the level of interest-bearing liabilities funding the Companys assets. Overall, RP Financial concluded that funding liabilities were a slightly negative factor in our adjustment for financial condition. | ||
§ | Capital . The Company currently operates with a slightly lower equity-to-assets ratio than the Peer Group. However, following the stock offering, Oritani Financials pro forma capital position will likely exceed the Peer Groups equity-to-assets ratio. The Companys higher pro forma capital position implies greater leverage capacity, lower dependence on interest-bearing liabilities to fund assets and a greater capacity to absorb unanticipated losses. At the same time, the Companys more significant capital surplus will make it difficult to achieve a competitive ROE. On balance, RP Financial concluded that capital strength was a slightly positive factor in our adjustment for financial condition. |
RP ® Financial, LC. Financial, LC. | VALUATION ANALYSIS | |
IV.5 |
§ | Reported Earnings . The Companys reported earnings were slightly higher than the Peer Groups on a ROAA basis (0.56% of average assets versus 0.49% for the Peer Group). The Companys slightly higher return was attributable to a lower level of operating expenses and net gains, which were somewhat offset by the Peer Groups higher net interest margin, lower loan loss provisions and higher non-interest operating income. Reinvestment of stock proceeds into interest-earning assets will serve to increase the Companys earnings, with the benefit of reinvesting proceeds expected to be somewhat offset by implementation of additional stock benefit plans in connection with the second-step offering. Overall, the Companys pro forma reported earnings were considered to be slightly stronger than the Peer Groups and, thus, RP Financial concluded that this was a slightly positive in our adjustment for profitability, growth and viability of earnings. | ||
§ | Core Earnings . Net interest income, operating expenses, non-interest operating income and loan loss provisions were reviewed in assessing the relative strengths and weaknesses of the Companys and the Peer Groups core earnings. The Company operated with a lower net interest margin, a lower operating expense ratio and a lower level of non-interest operating income. The Companys lower ratios for net interest income and operating expenses translated into a higher expense coverage ratio in comparison to the Peer Groups ratio (equal to 1.71x versus 1.31X for the Peer Group). Similarly, the Companys efficiency ratio of 53.2% was more favorable than the Peer Groups efficiency ratio of 63.8%. Loan loss provisions had a more significant impact on the Companys earnings. Overall, these measures, as well as the expected earnings benefits the Company should realize from the redeployment of stock proceeds into interest-earning assets and leveraging of post-conversion capital, which will be somewhat negated by expenses associated with the stock benefit plans and operating as a publicly-traded company, indicate that the Companys pro forma core earnings will be more favorable than the Peer Groups. Therefore, RP Financial concluded that this was a slightly positive factor in our adjustment for profitability, growth and viability of earnings. | ||
§ | Interest Rate Risk . Quarterly changes in the Companys and the Peer Groups net interest income to average assets ratios indicated a higher degree of volatility was associated with the Companys net interest margin. |
RP ® Financial, LC. Financial, LC. | VALUATION ANALYSIS | |
IV.6 |
Other measures of interest rate risk, such as capital and IEA/IBL ratios as well as level of non-interest earning assets were fairly comparable for the Company and the Peer Group. On a pro forma basis, the infusion of stock proceeds can be expected to provide the Company with equity-to-assets and IEA/ILB ratios that will be above the Peer Group ratios, as well as enhance the stability of the Companys net interest margin through the reinvestment of stock proceeds into interest-earning assets. On balance, RP Financial concluded that interest rate risk was a neutral factor in our adjustment for profitability, growth and viability of earnings. | |||
§ | Credit Risk . Loan loss provisions were a larger factor in the Companys earnings (0.51% of average assets versus 0.35% of average assets for the Peer Group). In terms of future exposure to credit quality related losses, the Company maintained a higher concentration of assets in loans and lending diversification into higher risk types of loans was more significant for the Company. Credit quality measures for non-performing assets and loss reserves as a percent of non-performing loans were less favorable for the Company, while the Company maintained higher loss reserves as a percent of loans. Overall, RP Financial concluded that credit risk was a moderate negative factor in our adjustment for profitability, growth and viability of earnings. | ||
§ | Earnings Growth Potential . Several factors were considered in assessing earnings growth potential. First, the Company maintained a less favorable interest rate spread than the Peer Group, which would tend to support a stronger net interest margin going forward for the Peer Group. Second, the infusion of stock proceeds will provide the Company with more significant growth potential through leverage than currently maintained by the Peer Group. Third, the Peer Groups higher ratio of non-interest operating income and the Companys lower operating expense ratio were viewed as respective advantages to sustain earnings growth during periods when net interest margins come under pressure as the result of adverse changes in interest rates. Overall, earnings growth potential was considered to be a slightly positive factor in our adjustment for profitability, growth and viability of earnings. | ||
§ | Return on Equity . Currently, the Companys core ROE is above the Peer Groups ROE. As the result of the significant increase in capital that will be realized from the infusion of net stock proceeds into the Companys equity, the Companys pro forma return equity on a core earnings basis will initially be more comparable to the Peer Groups core ROE. Accordingly, this was a neutral factor in the adjustment for profitability, growth and viability of earnings. |
RP ® Financial, LC. Financial, LC. | VALUATION ANALYSIS | |
IV.7 |
RP ® Financial, LC. Financial, LC. | VALUATION ANALYSIS | |
IV.8 |
December 2009 | ||||||
County | Unemployment | |||||
Oritani Financial NJ
|
Bergen | 8.1 | % | |||
|
||||||
Peer Group Average
|
9.0 | % | ||||
|
||||||
Beacon Federal Bancorp. NY
|
Onondaga | 7.6 | % | |||
Brookline Bancorp MA
|
Norfolk | 7.8 | ||||
Danvers Bancorp MA
|
Essex | 9.7 | ||||
ESB Financial Corp. PA
|
Lawrence | 9.7 | ||||
ESSA Bancorp PA
|
Monroe | 9.3 | ||||
OceanFirst Financial Corp. NJ
|
Ocean | 10.8 | ||||
Parkvale Financial Corp. PA
|
Allegheny | 7.2 | ||||
Provident NY Bancorp, Inc. NY
|
Rockland | 6.7 | ||||
United Financial Bancorp MA
|
Hampden | 10.6 | ||||
Westfield Financial MA
|
Hampden | 10.6 |
(1) | Unemployment rates are not seasonally adjusted. |
RP ® Financial, LC. Financial, LC. | VALUATION ANALYSIS | |
IV.9 |
RP ® Financial, LC. Financial, LC. | VALUATION ANALYSIS | |
IV.10 |
RP ® Financial, LC. Financial, LC. | VALUATION ANALYSIS | |
IV.11 |
RP ® Financial, LC. Financial, LC. | VALUATION ANALYSIS | |
IV.12 |
RP ® Financial, LC. Financial, LC. | VALUATION ANALYSIS | |
IV.13 |
RP ® Financial, LC. Financial, LC. | VALUATION ANALYSIS | |
IV.14 |
RP ® Financial, LC. Financial, LC. | VALUATION ANALYSIS | |
IV.15 |
RP ® Financial, LC. Financial, LC. | VALUATION ANALYSIS | |
IV.16 |
RP ® Financial, LC. |
Valuation Analysis
Page IV.17 |
Note: * Appraisal performed by RP Financial; BOLD =RP Financial did the Conversion Business Plan. NT Not Traded; NA Not Applicable, Not Available; C/S-Cash/Stock. | ||
(1) | Non-OTS regulated thrift. | |
(2) | As a percent of MHC offering for MHC transactions. | |
(3) | Does not take into account the adoption of SOP 93-6. | |
(4) | Latest price if offering is less than one week old. | |
(5) | Latest price if offering is more than one week but less than one month old. | |
(6) | Mutual holding company pro forma data on full conversion basis. | |
(7) | Simultaneously completed acquisition of another financial institution. | |
(8) | Simultaneously converted to a commercial bank charter. | |
(9) | Former credit union. |
RP ® Financial, LC. |
VALUATION ANALYSIS
IV.18 |
Market | Per Share Data | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Capitalization | Core | Book | Dividends(4) | Financial Characteristics(6) | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Price/ | Market | 12 Month | Value/ | Pricing Ratios(3) | Amount/ | Payout | Total | Equity/ | Tang Eq/ | NPAs/ | Reported | Core | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Financial Institution | Share(1) | Value | EPS(2) | Share | P/E | P/B | P/A | P/TB | P/Core | Share | Yield | Ratio(5) | Assets | Assets | Assets | Assets | ROA | ROE | ROA | ROE | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
($) | ($Mil) | ($) | ($) | (x) | (%) | (%) | (%) | (x) | ($) | (%) | (%) | ($Mil) | (%) | (%) | (%) | (%) | (%) | (%) | (%) | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
All Public Companies
|
$ | 9.51 | $ | 287.53 | ($0.14 | ) | $ | 12.19 | 17.96x | 81.45 | % | 9.88 | % | 89.82 | % | 19.58x | $ | 0.25 | 2.18 | % | 32.57 | % | $ | 2,649 | 11.27 | % | 10.52 | % | 3.16 | % | -0.16 | % | -0.34 | % | -0.14 | % | -0.84 | % | ||||||||||||||||||||||||||||||||||||||||||
Converted Last 3 Months (no MHC)
|
$ | 10.78 | $ | 319.21 | $ | 0.25 | $ | 15.09 | 25.59x | 73.33 | % | 12.16 | % | 76.41 | % | 21.99x | $ | 0.13 | 1.16 | % | 20.69 | % | $ | 2,114 | 6.47 | % | 6.09 | % | 1.03 | % | 0.24 | % | 3.61 | % | 0.28 | % | 3.52 | % | ||||||||||||||||||||||||||||||||||||||||||
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Converted Last 3 Months (no MHC)
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
AFCB Athens Bancshares, Inc. of TN
|
$ | 10.92 | $ | 30.34 | $ | 0.54 | $ | 17.42 | 20.22x | 62.69 | % | 11.29 | % | 62.69 | % | 20.22x | $ | 0.00 | 0.00 | % | 0.00 | % | $ | 269 | 0.00 | % | 0.00 | % | NA | 0.56 | % | NM | 0.56 | % | NM | |||||||||||||||||||||||||||||||||||||||||||||
NWBI Northwest Bancshares Inc. of PA
|
$ | 11.89 | $ | 1,315.53 | $ | 0.37 | $ | 11.90 | 39.63x | 99.92 | % | 16.39 | % | 115.32 | % | 32.14x | $ | 0.40 | 3.36 | % | NM | $ | 8,025 | 16.41 | % | 14.53 | % | 1.81 | % | 0.46 | % | 4.32 | % | 0.57 | % | 5.33 | % | |||||||||||||||||||||||||||||||||||||||||||
OBAF OBA Financial Serv. Inc. of MD
|
$ | 10.30 | $ | 47.68 | ($0.09 | ) | $ | 16.92 | NM | 60.87 | % | 12.00 | % | 60.87 | % | NM | $ | 0.00 | 0.00 | % | NM | $ | 397 | 0.00 | % | 0.00 | % | NA | -0.30 | % | NM | -0.10 | % | NM | ||||||||||||||||||||||||||||||||||||||||||||||
OSHC Ocean Shore Holding Co. of NJ
|
$ | 9.81 | $ | 71.69 | $ | 0.72 | $ | 13.01 | 16.91x | 75.40 | % | 9.31 | % | 75.40 | % | 13.63x | $ | 0.24 | 2.45 | % | 41.38 | % | $ | 770 | 7.69 | % | 7.69 | % | 0.25 | % | 0.55 | % | 7.15 | % | 0.68 | % | 8.88 | % | ||||||||||||||||||||||||||||||||||||||||||
OABC OmniAmerican Bancorp Inc. of TX
|
$ | 10.99 | $ | 130.81 | ($0.28 | ) | $ | 16.22 | NM | 67.76 | % | 11.81 | % | 67.76 | % | NM | $ | 0.00 | 0.00 | % | NM | $ | 1,108 | 8.23 | % | 8.23 | % | NA | -0.05 | % | -0.65 | % | -0.30 | % | -3.66 | % |
(1) | Average of High/Low or Bid/Ask price per share. | |
(2) | EPS (estimate core basis) is based on actual trailing 12 month data, adjusted to omit non-operating items on a tax-effected basis. | |
(3) | P/E = Price to earnings; P/B = Price to book; P/A = Price to assets; P/TB = Price to tangible book value; and P/Core = Price to core earnings. | |
(4) | Indicated 12 month dividend, based on last quarterly dividend declared. | |
(5) | Indicated 12 month dividend as a percent of trailing 12 month estimated core earnings. | |
(6) | ROA (return on assets) and ROE (return on equity) are indicated ratios based on trailing 12 month common earnings and average common equity and total assets balances. | |
(7) | Excludes from averages and medians those companies the subject of actual or rumored acquisition activities or unusual operating characteristics. |
RP ® Financial, LC. |
VALUATION ANALYSIS
IV.19 |
RP ® Financial, LC. |
VALUATION ANALYSIS
IV.20 |
RP ® Financial, LC. |
VALUATION ANALYSIS
IV.21 |
Key Valuation Parameters: | Valuation Adjustment | |
Financial Condition
Profitability, Growth and Viability of Earnings Asset Growth Primary Market Area Dividends Liquidity of the Shares Marketing of the Issue Management Effect of Govt. Regulations and Regulatory Reform |
Slight Upward
Slight Upward Moderate Upward No Adjustment No Adjustment No Adjustment Slight Downward No Adjustment No Adjustment |
RP ® Financial, LC. |
VALUATION ANALYSIS
IV.22 |
§ | P/E Approach . The P/E approach is generally the best indicator of long-term value for a stock and we have given it the most significant weight among the valuation approaches. Given certain similarities between the Companys and the Peer Groups earnings composition and overall financial condition, the P/E approach was carefully considered in this valuation. At the same time, recognizing that (1) the earnings multiples will be evaluated on a pro forma basis for the Company; and (2) the Peer Group on average has had the opportunity to realize the benefit of reinvesting and leveraging the offering proceeds, we also gave weight to the other valuation approaches. | ||
§ | P/B Approach . P/B ratios have generally served as a useful benchmark in the valuation of thrift stocks, particularly in the context of an initial public offering, as the earnings approach involves assumptions regarding the use of proceeds. RP Financial considered the P/B approach to be a valuable indicator of pro forma value taking into account the pricing ratios under the P/E and P/A approaches. We have also modified the P/B approach to exclude the impact of intangible assets (i.e., price/tangible book value or P/TB), in that the investment community frequently makes this adjustment in its evaluation of this pricing approach. | ||
§ | P/A Approach . P/A ratios are generally a less reliable indicator of market value, as investors typically assign less weight to assets and attribute greater weight to book value and earnings. Furthermore, this approach as set forth in the regulatory valuation guidelines does not take into account the amount of stock purchases funded by deposit withdrawals, thus understating the pro forma P/A ratio. At the same time, the P/A ratio is an indicator of franchise value, and, in the case of highly capitalized institutions, high P/A ratios may limit the investment communitys willingness to pay market multiples for earnings or book value when ROE is expected to be low. | ||
§ | Trading of ORIT stock . Converting institutions generally do not have stock outstanding. Oritani Financial, however, has public shares outstanding due to the mutual holding company form of ownership. Since Oritani Financial is currently traded on the NASDAQ, it is an indicator of investor interest in the Companys conversion stock and therefore received some weight in our valuation. Based on the February 19, 2010, stock price of |
RP ® Financial, LC. |
VALUATION ANALYSIS
IV.23 |
$13.80 per share and the 37,041,184 shares of Oritani Financial stock outstanding, the Companys implied market value of $511.2 million was considered in the valuation process. However, since the conversion stock will have different characteristics than the minority shares, and since pro forma information has not been publicly disseminated to date, the current trading price of Oritani Financials stock was somewhat discounted herein but will become more important towards the closing of the offering. |
RP ® Financial, LC. |
VALUATION ANALYSIS
IV.24 |
Amount | ||||
($000) | ||||
Net income(loss)
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$ | 10,419 | ||
Deduct: Gain on sale of assets(1)
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(636 | ) | ||
Add back: Loss on equity securities(1)
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265 | |||
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||||
Core earnings estimate
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$ | 10,048 |
(1) | Tax effected at 39.0%. |
RP ® Financial, LC. |
VALUATION ANALYSIS
IV.25 |
Market | Per Share Data | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Capitalization | Core | Book | Dividends(4) | Financial Characteristics(6) | 2nd Step | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Price/ | Market | 12 Month | Value/ | Pricing Ratios(3) | Amount/ | Payout | Total | Equity/ | Tang Eq/ | NPAs/ | Reported | Core | Exchange | Offering | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Share(1) | Value | EPS(2) | Share | P/E | P/B | P/A | P/TB | P/Core | Share | Yield | Ratio(5) | Assets | Assets | Assets | Assets | ROA | ROE | ROA | ROE | Ratio | Amount | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
($) | ($Mil) | ($) | ($) | (x) | (%) | (%) | (%) | (x) | ($) | (%) | (%) | ($Mil) | (%) | (%) | (%) | (%) | (%) | (%) | (%) | ($Mil) | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Oritani Financial Corp.
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Superrange
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$ | 10.00 | $ | 692.82 | $ | 0.17 | $ | 10.15 | 58.25x | 98.52 | % | 28.14 | % | 98.52 | % | 60.13x | $ | 0.30 | 3.00 | % | 180.38 | % | $ | 2,462 | 28.57 | % | 28.57 | % | 2.13 | % | 0.48 | % | 1.69 | % | 0.47 | % | 1.64 | % | 1.8704 | $ | 515.78 | |||||||||||||||||||||||||||||||||||||||||||||||
Maximum
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$ | 10.00 | $ | 602.45 | $ | 0.19 | $ | 10.68 | 51.50x | 93.63 | % | 25.08 | % | 93.63 | % | 53.19x | $ | 0.30 | 3.00 | % | 159.57 | % | $ | 2,402 | 26.79 | % | 26.79 | % | 2.19 | % | 0.49 | % | 1.82 | % | 0.47 | % | 1.76 | % | 1.6264 | $ | 448.50 | |||||||||||||||||||||||||||||||||||||||||||||||
Midpoint
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$ | 10.00 | $ | 523.87 | $ | 0.21 | $ | 11.30 | 45.45x | 88.50 | % | 22.29 | % | 88.50 | % | 46.96x | $ | 0.30 | 3.00 | % | 140.89 | % | $ | 2,351 | 25.18 | % | 25.18 | % | 2.23 | % | 0.49 | % | 1.95 | % | 0.47 | % | 1.88 | % | 1.4143 | $ | 390.00 | |||||||||||||||||||||||||||||||||||||||||||||||
Minimum
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$ | 10.00 | $ | 445.29 | $ | 0.25 | $ | 12.13 | 39.21x | 82.44 | % | 19.37 | % | 82.44 | % | 40.54x | $ | 0.30 | 3.00 | % | 121.62 | % | $ | 2,299 | 23.49 | % | 23.49 | % | 2.28 | % | 0.49 | % | 2.10 | % | 0.48 | % | 2.03 | % | 1.2022 | $ | 331.50 | |||||||||||||||||||||||||||||||||||||||||||||||
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All Non-MHC Public Companies (7)
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Averages
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$ | 9.63 | $ | 348.32 | ($0.24 | ) | $ | 13.64 | 17.34x | 69.92 | % | 8.00 | % | 78.47 | % | 18.45x | $ | 0.25 | 2.17 | % | 32.08 | % | $ | 3,023 | 10.81 | % | 10.00 | % | 3.40 | % | -0.25 | % | -0.57 | % | -0.26 | % | -1.67 | % | ||||||||||||||||||||||||||||||||||||||||||||||||||
Medians
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$ | 9.33 | $ | 49.86 | $ | 0.09 | $ | 12.90 | 15.75x | 69.89 | % | 6.38 | % | 75.04 | % | 16.25x | $ | 0.20 | 1.90 | % | 0.00 | % | $ | 903 | 9.20 | % | 8.62 | % | 2.66 | % | 0.19 | % | 2.09 | % | 0.09 | % | 1.12 | % | ||||||||||||||||||||||||||||||||||||||||||||||||||
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All Non-MHC State of NJ(7)
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Averages
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$ | 10.17 | $ | 1,586.29 | ($0.66 | ) | $ | 11.37 | 15.08x | 91.40 | % | 9.75 | % | 106.00 | % | 14.22x | $ | 0.35 | 3.17 | % | 58.04 | % | $ | 14,153 | 10.11 | % | 8.68 | % | 1.05 | % | -1.05 | % | -5.80 | % | -0.81 | % | -3.90 | % | ||||||||||||||||||||||||||||||||||||||||||||||||||
Medians
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$ | 10.00 | $ | 188.22 | $ | 0.63 | $ | 10.14 | 15.15x | 74.79 | % | 9.46 | % | 102.56 | % | 13.63x | $ | 0.44 | 4.05 | % | 0.17 | % | $ | 1,989 | 11.68 | % | 9.23 | % | 1.20 | % | 0.55 | % | 7.15 | % | 0.62 | % | 7.51 | % | ||||||||||||||||||||||||||||||||||||||||||||||||||
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Comparable Group Averages
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Averages
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$ | 10.38 | $ | 228.24 | $ | 0.58 | $ | 12.70 | 18.19x | 87.90 | % | 12.47 | % | 100.03 | % | 22.10x | $ | 0.26 | 2.62 | % | 42.63 | % | $ | 1,846 | 13.53 | % | 12.39 | % | 1.16 | % | 0.46 | % | 3.46 | % | 0.54 | % | 4.51 | % | ||||||||||||||||||||||||||||||||||||||||||||||||||
Medians
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$ | 9.88 | $ | 207.18 | $ | 0.41 | $ | 12.88 | 14.00x | 95.34 | % | 11.73 | % | 103.58 | % | 25.70x | $ | 0.22 | 2.57 | % | 38.59 | % | $ | 1,948 | 12.92 | % | 9.76 | % | 1.01 | % | 0.56 | % | 3.46 | % | 0.56 | % | 3.48 | % | ||||||||||||||||||||||||||||||||||||||||||||||||||
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Comparable Group
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BFED Beacon Federal Bancorp of NY
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$ | 8.62 | $ | 56.38 | $ | 1.12 | $ | 15.40 | 9.17 | 55.97 | % | 5.27 | % | 55.97 | % | 7.70x | $ | 0.20 | 2.32 | % | 21.28 | % | $ | 1,070 | 9.42 | % | 9.42 | % | NA | 0.59 | % | 6.15 | % | 0.71 | % | 7.33 | % | |||||||||||||||||||||||||||||||||||||||||||||||||||
BRKL Brookline Bancorp, Inc. of MA
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$ | 9.76 | $ | 576.14 | $ | 0.33 | $ | 8.26 | 29.58 | 118.16 | % | 22.03 | % | 130.66 | % | 29.58x | $ | 0.34 | 3.48 | % | NM | $ | 2,616 | 18.71 | % | 17.25 | % | NA | 0.74 | % | 3.98 | % | 0.74 | % | 3.98 | % | ||||||||||||||||||||||||||||||||||||||||||||||||||||
DNBK Danvers Bancorp, Inc. of MA
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$ | 13.94 | $ | 302.58 | $ | 0.24 | $ | 13.16 | NM | 105.93 | % | 12.10 | % | 121.64 | % | NM | $ | 0.08 | 0.57 | % | 33.33 | % | $ | 2,500 | 11.43 | % | 10.10 | % | 0.73 | % | 0.27 | % | 2.17 | % | 0.27 | % | 2.17 | % | ||||||||||||||||||||||||||||||||||||||||||||||||||
ESBF ESB Financial Corp. of PA
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$ | 12.32 | $ | 148.54 | $ | 1.08 | $ | 13.87 | 12.57 | 88.82 | % | 7.50 | % | 119.61 | % | 11.41x | $ | 0.40 | 3.25 | % | 40.82 | % | $ | 1,979 | 8.48 | % | 6.45 | % | NA | 0.60 | % | 7.99 | % | 0.66 | % | 8.81 | % | |||||||||||||||||||||||||||||||||||||||||||||||||||
ESSA ESSA Bancorp, Inc. of PA
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$ | 11.62 | $ | 164.12 | $ | 0.38 | $ | 12.90 | 29.79 | 90.08 | % | 15.87 | % | 90.08 | % | 30.58x | $ | 0.20 | 1.72 | % | 51.28 | % | $ | 1,034 | 17.62 | % | 17.62 | % | NA | 0.53 | % | 2.94 | % | 0.51 | % | 2.87 | % | |||||||||||||||||||||||||||||||||||||||||||||||||||
OCFC OceanFirst Financial Corp. of NJ
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$ | 10.00 | $ | 188.22 | $ | 0.63 | $ | 9.75 | 15.15 | 102.56 | % | 9.46 | % | 102.56 | % | 15.87x | $ | 0.48 | 4.80 | % | 72.73 | % | $ | 1,989 | 9.23 | % | 9.23 | % | 1.55 | % | 0.65 | % | 7.87 | % | 0.62 | % | 7.51 | % | ||||||||||||||||||||||||||||||||||||||||||||||||||
PVSA Parkvale Financial Corp. of PA
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$ | 7.30 | $ | 40.23 | $ | 1.02 | $ | 21.73 | NM | 33.59 | % | 2.10 | % | 44.32 | % | 7.16x | $ | 0.20 | 2.74 | % | NM | $ | 1,916 | 7.91 | % | 6.50 | % | 1.90 | % | -0.58 | % | -7.19 | % | 0.30 | % | 3.67 | % | |||||||||||||||||||||||||||||||||||||||||||||||||||
PBNY Provident NY Bancorp, Inc. of NY
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$ | 8.48 | $ | 331.24 | $ | 0.33 | $ | 10.76 | 12.85 | 78.81 | % | 11.35 | % | 130.26 | % | 25.70x | $ | 0.24 | 2.83 | % | 36.36 | % | $ | 2,918 | 14.40 | % | 9.24 | % | 1.01 | % | 0.88 | % | 6.12 | % | 0.44 | % | 3.06 | % | ||||||||||||||||||||||||||||||||||||||||||||||||||
UBNK United Financial Bancorp of MA
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$ | 13.43 | $ | 226.15 | $ | 0.43 | $ | 12.85 | NM | 104.51 | % | 18.13 | % | 104.60 | % | 31.23x | $ | 0.28 | 2.08 | % | NM | $ | 1,247 | 17.35 | % | 17.33 | % | NA | 0.45 | % | 2.53 | % | 0.58 | % | 3.29 | % | ||||||||||||||||||||||||||||||||||||||||||||||||||||
WFD Westfield Financial Inc. of MA
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$ | 8.34 | $ | 248.79 | $ | 0.21 | $ | 8.29 | NM | 100.60 | % | 20.88 | % | 100.60 | % | 39.71x | $ | 0.20 | 2.40 | % | NM | $ | 1,191 | 20.76 | % | 20.76 | % | 0.60 | % | 0.46 | % | 2.09 | % | 0.54 | % | 2.44 | % |
(1) | Average of High/Low or Bid/Ask price per share. | |
(2) | EPS (estimate core basis) is based on actual trailing 12 month data, adjusted to omit non-operating items on a tax-effected basis, and is shown on a pro forma basis where appropriate. | |
(3) | P/E = Price to earnings; P/B = Price to book; P/A = Price to assets; P/TB = Price to tangible book value; and P/Core = Price to core earnings. | |
(4) | Indicated 12 month dividend, based on last quarterly dividend declared. | |
(5) | Indicated 12 month dividend as a percent of trailing 12 month estimated core earnings. | |
(6) | ROA (return on assets) and ROE (return on equity) are indicated ratios based on trailing 12 month common earnings and average common equity and total assets balances. | |
(7) | Excludes from averages and medians those companies the subject of actual or rumored acquisition activities or unusual operating characteristics. |
RP ® Financial, LC. |
VALUATION ANALYSIS
IV.26 |
RP ® Financial, LC. |
VALUATION ANALYSIS
IV.27 |
RP ® Financial, LC. |
VALUATION ANALYSIS
IV.28 |
RP
®
FINANCIAL, LC.
|
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Serving the Financial Services Industry Since 1988
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Re:
|
Plan of Conversion and Reorganization | |
|
Oritani Financial Corp., MHC | |
|
Oritani Financial Corp. |
(1) | the subscription rights will have no ascertainable market value; and, | ||
(2) | the price at which the subscription rights are exercisable will not be more or less than the pro forma market value of the shares upon issuance. |
Sincerely,
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/s/ RP FINANCIAL, LC. | ||||
RP FINANCIAL, LC. | ||||
Washington Headquarters
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Rosslyn Center
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Telephone: (703) 528-1700 | |
1700 North Moore Street, Suite 2210
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Fax No.: (703) 528-1788 | |
Arlington, VA 22209
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Toll-Free No.: (866) 723-0594 | |
www.rpfinancial.com
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E-Mail: mail@rpfinancial.com |
Re: |
Plan of Conversion and Reorganization
Oritani Financial Corp., MHC Oritani Financial Corp. |
Washington Headquarters
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Three Ballston Plaza
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Telephone: (703) 528-1700 | |
1100 North Glebe Road, Suite 1100
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Fax No.: (703) 528-1788 | |
Arlington, VA 22201
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Toll-Free No.: (866) 723-0594 | |
www.rpfinancial.com
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E-Mail: mail@rpfinancial.com |