UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 14A
(Rule 14a-101)
INFORMATION REQUIRED IN PROXY STATEMENT
SCHEDULE 14A INFORMATION
PROXY STATEMENT PURSUANT TO SECTION 14(a) OF THE SECURITIES
EXCHANGE ACT OF 1934 (AMENDMENT NO.____)
Filed by the Registrant
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Filed by a Party other than the Registrant
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Check the appropriate box:
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Preliminary Proxy Statement
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Confidential, For Use of the Commission Only (as permitted by Rule 14a-6(e)(2))
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Definitive Proxy Statement
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Definitive Additional Materials
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Soliciting Material Pursuant to Section 240.14a-11(c) or Section 240.14a-12
Hudson Valley Holding Corp.
(Name of Registrant as Specified In Its Charter)
(Name of Person(s) Filing Proxy Statement, if other than Registrant)
Payment of Filing Fee (Check the appropriate box):
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No fee required
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Check box if any part of the fee is offset as provided by Exchange Act
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was paid previously. Identify the previous filing by registration
statement number, or the Form or Schedule and the date of its filing.
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TABLE OF CONTENTS
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HUDSON VALLEY HOLDING CORP.
21 Scarsdale Road
Yonkers, New York 10707
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NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
TO BE HELD ON MAY 12, 2011
We will hold the annual meeting of shareholders of Hudson Valley Holding Corp. a New York
corporation (the Company), at the Companys headquarters at 21 Scarsdale Road, Yonkers, New York
on Thursday, May 12, 2011 at 10:30 a.m., local time, for the following purposes:
1.
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To elect twelve directors of the Company.
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2.
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To consider a non-binding advisory vote to approve the compensation of named executive
officers.
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3.
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To consider a non-binding advisory vote on the frequency of future advisory votes on the
compensation of named executive officers.
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4.
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To ratify the appointment of Crowe Horwath LLP as the Companys independent registered
public accounting firm for the fiscal year ending December 31, 2011.
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5.
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To act on such other matters as may be properly brought before the meeting or any
adjournments, postponements or continuations of the meeting.
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The Board of Directors unanimously recommends that you vote:
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FOR the election of all of the nominees for director;
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FOR the non-binding approval of the compensation of the named executive officers,
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FOR holding the advisory vote on executive compensation every year, and
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FOR the ratification of the appointment of our independent registered
public accounting firm.
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The Board of Directors has fixed the close of business on March 28, 2011, as the record date
for the meeting. Only shareholders of record at the close of business on this date are entitled to
notice of, and to vote at, the meeting or any adjournments, postponements or continuations of the
meeting.
All shareholders are invited to attend the meeting. Whether or not you expect to attend the
meeting, to ensure your representation at the meeting, you are urged to submit your vote by
telephone, over the internet, or by signing, dating and completing the enclosed proxy and mailing
it promptly in the enclosed return envelope. In the event that you attend the meeting, you may
vote in person even if you have returned a proxy.
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Your vote is important.
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April 8, 2011
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By Order of the Board of Directors
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Stephen R. Brown
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Secretary
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********************
IMPORTANT NOTICE REGARDING THE AVAILABILITY OF PROXY MATERIAL FOR THE ANNUAL MEETING TO BE HELD ON
MAY 12, 2011: THE COMPANYS NOTICE OF THE ANNUAL MEETING OF SHAREHOLDERS, PROXY STATEMENT AND
ANNUAL REPORT ON FORM 10-K FOR THE FISCAL YEAR ENDED DECEMBER 31, 2010 ARE AVAILABLE AT:
WWW.PROXYDOCS.COM/HUVL
Hudson Valley Holding Corp.
21 Scarsdale Road
Yonkers, New York 10707
PROXY STATEMENT
This proxy statement is furnished to you in connection with the solicitation of proxies by the
Board of Directors to be used at the 2011 annual meeting of shareholders of Hudson Valley Holding
Corp. (the Company). Copies of this proxy statement are being mailed on or about April 8, 2011
to persons who were shareholders of record on March 28, 2011.
The Company, a New York corporation is registered as a bank holding company under
the Bank Holding Company Act of 1956. The Company provides financial services through its
wholly-owned subsidiary, Hudson Valley Bank, N.A. (HVB or the Bank). New York National Bank
(NYNB), a national banking association, was merged into HVB effective March 1, 2010. The Company
provides investment management services through a wholly-owned subsidiary of HVB, A.R. Schmeidler &
Co., Inc.
Date, Time and Place of Meeting
We will hold the 2011 annual meeting of shareholders on Thursday, May 12, 2011, at 10:30 a.m.
local time, at 21 Scarsdale Road, Yonkers, New York, for the purposes set forth in the accompanying
Notice of Annual Meeting of Shareholders.
Matters to be Considered at the Meeting
At the meeting, we will ask our shareholders to consider and vote upon:
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the election of twelve directors,
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a non-binding advisory vote to approve the compensation of named executive
officers,
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a non-binding advisory vote on the frequency of future advisory votes on the
compensation of named executive officers, and
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the ratification of the appointment of Crowe Horwath LLP as the Companys
independent registered public accounting firm for the fiscal year ending December 31,
2011.
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The shareholders will also consider and vote upon such other matters as may properly be
brought before the meeting or any adjournment, postponement or continuation thereof.
Vote Required
The presence, in person or by proxy, of the holders of a majority of the shares
entitled to vote generally for the election of directors is necessary to constitute a quorum at the
meeting. Abstentions and broker non-votes are counted as present and entitled to vote for
purposes of determining a quorum. A broker non-vote occurs when a nominee holding shares for a
beneficial owner does not vote on a particular proposal because the nominee does not have
discretionary power with respect to that item and has not received instructions from the beneficial
owner.
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The following table indicates the vote required for the approval of each proposal to be
presented to shareholders at the annual meeting and the effect of abstentions, and broker
non-votes.
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Effect of Abstentions,
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Proposal
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Required Vote
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Broker Non-Votes
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Proposal #1:
Election of Directors
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A plurality of votes
cast by shareholders
present in person or
by proxy
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Abstentions and broker
non-votes will have no
effect on the outcome
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Proposal #2:
Non-binding advisory
vote on named
executive officer
compensation
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Affirmative vote of
a majority of the
votes cast by
shareholder present
in person or by
proxy
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Abstentions and broker
non-votes will have no
effect on the outcome
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Proposal #3:
Non-binding advisory
vote on the frequency
of future advisory
votes on executive
compensation
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A plurality of votes
cast by shareholders
present in person or
by proxy
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Abstentions and broker
non-votes will have no
effect on the outcome
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Proposal #4:
Ratification of the
appointment of the
independent
registered public
accounting firm.
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Affirmative vote of
a majority of the
votes cast by
shareholder present
in person or by
proxy
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Abstentions and broker
non-votes will have no
effect on the outcome
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Voting of Proxies
Shares of our common stock represented by properly executed proxies received in time for the
meeting, unless previously revoked, will be voted at the meeting as specified by the shareholders
on the proxies. The Company is also offering our shareholders the opportunity to vote by telephone
or through the internet. Those shareholders who hold shares through a nominee should refer to
instructions on their Voting Instruction Form.
Voting By Internet
A registered shareholder can vote, 24 hours a day, seven days a week at
www.proxyvotenow.com/huvl. You will need the 9-digit control number included on your proxy card.
Voting By Telephone
A registered shareholder can vote using a touch-tone telephone 24 hours a day, seven days a
week, by calling 1-866-776-5649 in the United States. You will need the 9-digit control number
included on your proxy card.
The Internet and telephone voting procedures are designed to authenticate shareholders
identities, to allow shareholders to vote their shares and to confirm that their instructions have
been properly recorded.
Voting By Mail
To vote your proxy by mail, please sign as instructed on your proxy card, date and mail your
proxy card in the envelope provided as soon as possible. Proxies may also be submitted in person
at the Company to Wendy Croker, First Vice President, Shareholder Relations, or via facsimile
directly to Registrar and Transfer Company at 908-272-6835. If a proxy is returned without any
voting instructions, the shares represented thereby will be voted in favor of the nominated slate
of directors, in favor of the approval of named executive officer compensation, in favor of an
annual vote as the frequency of the shareholder advisory vote on executive compensation and in
favor of the ratification of the appointment of the independent registered public accounting firm,
each as recommended by the Board of Directors.
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Revocability of Proxies
If you authorize a proxy, you have the power to revoke it at any time before it is voted. You
can do so in a number of ways. First, you can send a written notice to our transfer agent,
Registrar and Transfer Company (RTCO), at the following address stating that you would like to
revoke your proxy. Second, you can complete a new proxy card and send it to RTCO at the following
address. Third, you can submit a new proxy via the internet or by telephone. You can attend the
meeting and vote in person. You can change your vote as many times as you wish prior to the annual
meeting and the last vote received chronologically will supersede any prior vote. You should send
any written notice or new proxy card to:
Registrar and Transfer Company
Attn: Proxy Dept
10 Commerce Drive
Cranford NJ 07016-3572
You may request a new proxy card by calling RTCO at 1-800-368-5948
Record Date; Shareholders Entitled to Vote; Quorum
Only shareholders of record at the close of business on March 28, 2011, will be entitled to
receive notice of and vote at the meeting. As of the record date 17,680,895 shares of common stock
were issued and outstanding. Each share of common stock is entitled to one vote on each matter on
which holders of common stock are entitled to vote. A majority of the outstanding shares of common
stock entitled to vote must be represented in person or by proxy at the meeting in order for a
quorum to be present.
Solicitation of Proxies
This proxy solicitation is being made by the Board of Directors, the form of which is
enclosed, for the meeting. The cost of any solicitation will be borne by the Company. Our
officers, directors or regular employees may communicate with shareholders personally or by mail,
telephone, email or otherwise for the purpose of soliciting proxies. We and our authorized agents
will request brokers or other custodians, nominees and fiduciaries to forward proxy soliciting
material to the beneficial owners of shares held of record by these persons and will reimburse
their reasonable out-of-pocket expenses in forwarding the material. We are paying Phoenix Advisory
Partners a fee of $6,000 plus reasonable out-of-pocket expenses, to assist with the solicitation of
proxies.
Proposals of Shareholders and Communication with Shareholders
Shareholders of the Company who intend to present a proposal for action at the 2012 Annual
Meeting of Shareholders of the Company and include such proposal in the Companys proxy statement
under Securities and Exchange Commissions (the SEC) shareholder proposal rule (Rule 14a-8) must
notify the Companys management of such intention by notice in accordance with Rule 14a-8, received
at the Companys principal executive offices not later than December 10, 2011.
Shareholders of the Company who intend to present a proposal for action directly at the 2012
Annual Meeting of Shareholders of the Company outside of the Rule 14a-8 process must notify the
Companys management of such intention by notice, received at the Companys principal executive
offices between January 13, 2012 and February 12, 2012. The notice must be in the manner and form
required by the Companys Bylaws.
The Board maintains active communication directly with shareholders. Oral and written
inquiries from shareholders are responded to by the First Vice President, Shareholder Relations,
one of the Executive Officers or the Chairman of the Board. The Board is advised of shareholder
inquiries where appropriate. The Board meets with and interacts with shareholders on an ad hoc
basis. Shareholders who wish to communicate with the Board of Directors directly may do so by
writing to the Board of Directors or to any
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member of the Board at the Companys offices or through the Companys website at
www.hudsonvalleybank.com.
The Companys management has initiated an Investor Relations program which includes quarterly
conference calls to present the Companys earnings and answer questions from the investment
community. In addition, the President and Chief Executive Officer and the Chief Financial Officer
have meetings with investors on an adhoc basis. They also have plans to participate in certain
Investor Relations events during the course of the year and make presentations to the investment
community.
The Board and Management believe this combination of existing programs facilitates effective
open communication with the Companys shareholders and the investment community.
We have adopted a service approved by the SEC referred to as householding, which is designed
to reduce duplicate mailings to you and to save printing and postage cost. This rule allows us to
send a single set of certain shareholder documents, including the proxy statement, and annual
report, to any household at which multiple shareholders reside, if we believe the shareholders are
members of the same family, unless we receive contrary instructions from you. You will continue to
receive individual proxy cards for each individual shareholder.
We will deliver promptly upon written or oral request separate copies of shareholder documents
to any shareholder at a shared address to which a single set of those documents was delivered. To
receive separate documents in the future, you may call or write Registrar and Transfer Company at
10 Commerce Drive, Cranford NJ 07016-3572 or 1-800-368-5948. Your continued consent to householding
will be presumed unless you notify us that you wish to receive separate documents. We will begin
sending separate documents within 30 days after receipt of notice revoking consent. If you own your
shares through a bank, broker or other nominee, you can request householding by contacting the
nominee.
Other Matters
The Board of Directors knows of no matters that are expected to be presented for consideration
at the meeting that are not described herein. However, if other matters properly come before the
meeting, it is intended that the persons named in the accompanying proxy will vote thereon in
accordance with their best judgment.
PROPOSAL 1: ELECTION OF DIRECTORS
It is the intention of the persons named in the enclosed proxy card to vote the shares
represented by such proxy for the election of all of the nominees listed below, unless such proxy
specifies otherwise
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Certain information regarding each nominee is set forth in the table and text
below. The number of shares beneficially owned by each nominee is listed under Security Ownership
of Certain Beneficial Owners and Management, beginning on page 33.
Nominees for the Board of Directors
All directors of the Company serve for a term of one year, until the next annual meeting of
shareholders or until their respective successors have been duly elected and qualified
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All of the
nominees are currently serving as directors. The following table sets forth the names and ages of
the nominees, each nominees position with the Company, if any, the principal occupation of each
nominee, the period during which each nominee has served as a director of the Company and certain
other background information about the nominees based on information obtained from each nominee.
In addition, described below is each nominees particular experience, qualifications, attributes or
skills that have led the Board of Directors to conclude that the person should serve as a director
of the Company. Mr. John P. Cahill was appointed a director of the Company March 1, 2010 based upon
a recommendation of the Nominating Committee.
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Director
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of the
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Position with the Company and Principal
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Company
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Name
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Age
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Occupation; Other Directorships
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Since
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Independent
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William E. Griffin
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78
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Mr. Griffin is an attorney and is a
shareholder and President of Griffin,
Coogan, Blose & Sulzer, P.C., a law
firm located in Bronxville, New York.
Mr. Griffin has served as Chairman of
the Board since 1990. Mr. Griffin,
one of the original founders of HVB,
is a valuable member of the Board of
Directors because of his in-depth
knowledge in general banking, real
estate lending, corporate governance
and regulatory matters. His legal
training and experience are helpful to
the Board in reviewing the Companys
legal documentation or when legal
matters arise.
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1981
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No
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James J. Landy
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56
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President and Chief Executive
Officer of the Company since
January 2001. Previously, Mr.
Landy served as Executive
Vice President of HVB and in
various other executive
capacities with HVB. He has
been employed by HVB since
1977. Mr. Landy is a
director of Sacred Heart
Housing Corp., a senior
citizen housing company in
Yonkers, the Chairman of St.
Josephs Medical Center, a
health care facility in
Yonkers, New York and a
director of the New York
Bankers Association. His
commercial banking background
for over thirty years in
conjunction with his
leadership ability makes him
a valuable member of the
Board of Directors. As the
President and Chief Executive
Officer of the Company, he
brings to the Board an
intimate understanding of the
Companys business and
organization and the
community we serve. He
provides the Board with
insights and information
regarding the operations of
the Company, which assists
the Board in providing
adequate levels of management
oversight.
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2000
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No
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Stephen R. Brown
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55
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Senior Executive Vice
President, Chief Financial
Officer of the Company since
June 2001, Treasurer of the
Company since July 2004 and
Secretary since May 2010.
Previously, Mr. Brown served
in various other executive
capacities with the Company
and HVB. He has been
employed by HVB since 1993.
Prior to joining HVB, Mr.
Brown held executive
management positions with
companies in the
manufacturing, distribution,
transportation and financial
services industries with both
public and private companies.
He is a Certified Public
Accountant. Mr. Brown brings
over thirty years of general
business, managerial and
commercial banking experience
as well as financial
expertise to the Board of
Directors. His
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2000
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No
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Director
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of the
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Position with the Company and Principal
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Company
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Name
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Age
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Occupation; Other Directorships
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Since
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Independent
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current
position with the Company,
along with his prior
professional experience
outside of the Company,
provides the Board of
Directors with unique
insights as to the Companys
operations, policies,
implementation of strategic
plans and SEC and public
company issues.
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John P. Cahill
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52
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Counsel at Chadbourne & Parke
LLP, a law firm based in New
York, New York, since March
2007. Mr. Cahill is also
Co-Founder of the
Pataki-Cahill Group LLC,
based in New York, New York,
a strategic consulting firm
established in 2007 focusing
on the economic and policy
implication of domestic
energy needs. From 1995 to
2006, Mr. Cahill served in
various capacities in the
administration of the
Governor of New York George
E. Pataki, including Chief of
Staff to the Governor,
Commissioner of the New York
Department of Environmental
Conservation and as Chairman
of the Environmental
Facilities Corporation. He is
a member of the Board of
Directors of TBS
International, an
international shipping
company based in Ireland, a
trustee for the National
September 11 Memorial Museum
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2011
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Yes
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and serves on the board of
various civic and non-profit
organizations. Mr. Cahills
extensive experience as an
attorney in government and in
business together with his
affiliations and active
involvement in various
organizations within the
Companys marketplace makes
him a valuable member of the
Board.
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Mary-Jane Foster
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60
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Vice President, University
Relations, of University of
Bridgeport, located in
Bridgeport, Connecticut,
since May 2009. Ms. Foster
is also a co-owner and Chief
Executive Officer of
Westchester Baseball, LLC, an
investor group located in
Yonkers, New York since 1999.
She was a principal of Black
Rock Investors, LLC, a
development and investment
firm, located in Bridgeport,
Connecticut, from 1995 to
2009. Ms. Foster was also
the Co-founder, Owner and
Chief Executive Officer of
Bridgeport Bluefish
Professional Baseball Club
based in Bridgeport,
Connecticut from December
2005 to October 2008. Ms.
Fosters knowledge of the
business landscape in
Connecticut, together with
her business and personal
affiliations as well as her
active involvement in
investing and development in
Connecticut makes her a
valuable member of the Board
of Directors, particularly as
the Company continues to
expand into key markets in
Connecticut.
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2008
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Yes
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Director
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of the
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Position with the Company and Principal
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Company
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Name
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Age
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Occupation; Other Directorships
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Since
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Independent
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Gregory F. Holcombe
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49
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Vice President, BMW
Machinery Co., Inc., an
investment holding
company, since 1994. From
2000 to January 2006, Mr.
Holcombe also served as
Vice President of Supply
Chain Management of
Precision Valve
Corporation, a maker of
aerosol spray valves based
in Yonkers, New York.
Mr. Holcombe has developed
a deep understanding of
the key markets we serve
which, together with his
extensive business
experience and management
expertise, makes him a
valuable member of the Board of Directors.
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1999
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Yes
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Adam W. Ifshin
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45
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President and Chief Executive
Officer of DLC Management
Corp., a company property
management firm specializing in
owning and operating retail
shopping centers, located in
Tarrytown, New York, since
1991. In addition, Mr. Ifshin
is President of Delphi
Commercial Properties, Inc., a
specialty real estate brokerage
firm, President of First Man
Investment Securities Corp., a
placement agent for real estate
investments and a co-founder of
DLC UrbanCore, a joint venture
created to promote development
of retail real estate in
under-served, infill and
multi-ethnic markets
nationwide. Mr. Ifshins
extensive real estate and
financial markets experience,
together with his vast
knowledge of the New York
metropolitan marketplace, makes
him a valuable member of the
Board of Directors.
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2008
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Yes
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Michael P. Maloney
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49
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Executive Vice President,
Chief Banking Officer of
HVB since October 2005.
From January 2001 to
October 2005, Mr. Maloney
served as Executive Vice
President, Strategic
Relationships and Sales of
HVB. He has been employed
by HVB since 1993. Mr.
Maloney brings to the Board
of Directors a deep
understanding of the
Companys customers, people
and products that he
acquired over fifteen years
of service with the
Company. In addition Mr.
Maloney has a law degree.
During the years he has
spent with HVB, he has
gained extensive knowledge
of the Companys business,
history, organization and
executive management which,
together with the
relationships that he has
developed, enhances his
contributions to the Board
of Directors.
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2006
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No
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- 7 -
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Director
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of the
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Position with the Company and Principal
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Company
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Name
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Age
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Occupation; Other Directorships
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Since
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Independent
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Angelo R. Martinelli
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83
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Chairman of the Board of
Gazette Press, Inc., a
printing company located
in Yonkers, New York
since 1948. Mr.
Martinelli is also the
Chairman of the Board of
Suburban Publishing Co.,
which publishes the
Hudson Valley Magazine,
since 1972. Mr.
Martinelli served as the
Mayor of Yonkers for
twelve years and has been
the President of Police
Athletic League of
Yonkers for fifteen
years. Mr. Martinelli is
also the Chairman of
Yonkers Chamber of
Commerce and served on
the Board of Directors of
St. Josephs Medical
Center and The Sharing
Community. He is the
honoree of many social,
professional and
political organizations.
Through his deep
involvement in the
community, both
politically and
professionally, Mr.
Martinelli has gained a
unique understanding of
the community and the
political landscape of
the markets in which the
Board intends to continue
to grow the Companys
businesses. Mr.
Martinelli brings to the
Board of Directors
extensive general
business experience and
unique business
perspectives acquired
from running two
successful companies over
the years.
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1990
|
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No
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John A. Pratt Jr.
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80
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|
Vice Chairman of the Board
of the Company since
December 2009. Mr. Pratt is
a consultant to HVB since
1996, advising HVB on
business development and
retention. Previously, Mr.
Pratt was the President and
Chief Executive Officer of
the Company, retiring in
1995. Mr. Pratt possesses a
deep understanding of the
Companys customers, people
and products that he
acquired over thirty four
years of service with the
Company. His business
acumen, coupled with his
extensive management and
leadership experience with
the Company, positions him
well to serve on the Board
of Directors.
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1983
|
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|
Yes
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Cecile D. Singer
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81
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|
|
Principal in Cecile D.
Singer Consulting, a
consulting firm located in
Yonkers, New York,
specializing in government
relations since 1995. Ms.
Singer currently serves as
the Chairperson of the audit
committees of Yonkers
Industrial Development
Corporation and Westchester
Community College
Foundation. In addition,
Ms. Singer is the founder
and President of Womens
Enterprise Development
Center, the SBAs center for
womens business in the
Lower Hudson Valley, a
non-profit organization
which provides training
programs and support
services to both start-up
and established women
businesses. Ms. Singer is
also the Treasurer of
Riverside Corporation, a
Board member of Yonkers
Economic Development
Corporation
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1994
|
|
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Yes
|
- 8 -
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Director
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of the
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Position with the Company and Principal
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Company
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Name
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Age
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Occupation; Other Directorships
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Since
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Independent
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and a former New
York State Assemblywoman.
Ms. Singer has developed
strong ties to the
communities in Westchester
County, which remains the
Companys primary market.
With her wide range of
professional experience and
knowledge, Ms. Singer brings
a variety of business
experience in corporate
governance, auditing, and
management to the Board of
Directors.
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Craig S. Thompson
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57
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President and principal
shareholder of Thompson
Pension Employee Plans,
Inc., a company located in
New York City and
specializing in pension
administration and
investment and insurance
sales for over twenty years.
Through his business, Mr.
Thompson has developed
extensive knowledge of
pension plans and related
businesses, which provides
the Board of Directors with
unique insights regarding
the development of potential
customer relationships and
opportunities for the
Company. In addition to Mr.
Thompsons business
experience he has a law
degree. This unique
combination of experience
provides the Board of
Directors with a valuable
perspective on legal and
business management matters.
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1988
|
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Yes
|
OUR BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS A VOTE FOR
EACH NOMINEE FOR THE BOARD OF DIRECTORS
Executive Officers
Certain information with respect to executive officers of the Company and of HVB is set forth
below. All executive officers are elected by the Board of Directors and serve at the pleasure of
the Board of Directors. Messrs. Griffin, Landy and Brown serve as executive officers of both the
Company and HVB, while the other individuals named below are executive officers of HVB only.
Biographical information concerning executive officers who are also members of the Board of
Directors is given under the caption Nominees for the Board of Directors beginning on page 4.
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Name
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Age
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Position
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William E. Griffin
|
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78
|
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Chairman of the Board and Director
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James J. Landy
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56
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President, Chief Executive Officer and Director
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Stephen R. Brown
|
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55
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Senior Executive Vice President, Chief
Financial Officer, Secretary, Treasurer and
Director
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Michael J. Gilfeather
|
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53
|
|
|
Executive Vice President, Branch Banking of
HVB since joining the Bank in July 2005.
|
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Michael P. Maloney
|
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49
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Executive Vice President, Chief Banking
Officer of HVB and Director.
|
- 9 -
|
|
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Name
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Age
|
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Position
|
Vincent T. Palaia
|
|
|
64
|
|
|
Executive Vice President and Chief Lending
Officer of HVB since 1997. He has been
employed by HVB since 1988.
|
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Frank J. Skuthan
|
|
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58
|
|
|
Executive Vice President, Chief Operating
Officer and Marketing Director of HVB since
November 2007. From August 2000 to November
2007, Mr. Skuthan served as Executive Vice
President and Marketing Director of HVB. He
has been employed by HVB since 2000.
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Paul Ulrich
|
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59
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|
|
Executive Vice President and Chief Credit
Officer of HVB since September 2010. From
July 2007 to September 2010, Mr. Ulrich was
Senior Vice President, Senior Credit Officer
of First Tennessee Bank, a financial
institution based in Memphis, Tennessee. From
October 2004 to July 2007, Mr. Ulrich served
as Senior Vice President, Senior Credit
Officer National Corporate Real Estate for
Washington Mutual, a financial institution
based in Seattle, Washington.
|
The Board of Directors and Committees of the Board
Corporate Governance
Under NASDAQ independence standards, the Board of Directors has affirmatively determined that
Ms. Foster, Ms. Singer and Messrs. Cahill, Holcombe, Ifshin, Pratt and Thompson meet the standards
of independence for board members. The Board had also previously determined that Mr. Mulrow
qualified as an independent board member prior to his resignation in 2010. In addition to the
transactions disclosed under Transactions with Related Persons on page 31, the Board of Directors
considered the banking relationship that exists between HVB and Ms. Foster, Ms. Singer and Messrs.
Cahill, Ifshin, Holcombe, Pratt and Thompson in determining each directors independence. Since
these banking products and services are provided in the normal course of business and are available
on the same basis as to customers in general, the Board of Directors concluded that these
relationships do not affect the directors independence. The Board of Directors also concluded that
those transactions disclosed under Transactions with Related Persons on page 31 do not affect the
directors independence.
The Companys Board of Directors convened 16 times in 2010. The Companys Committees of the
Board of Directors include the Audit Committee, the Compensation and Organization Committee and the
Nominating Committee. Other policy decisions for the Company and its subsidiaries continue to
often be made by the full Board of Directors of the Company or HVB, or by a standing committee of
the Board of Directors of HVB. Other than Adam Ifshin no other director attended fewer than 75
percent of the meetings of the Board and the Committees of the Board on which he or she has served.
The Companys Board of Directors has adopted a code of ethics for all directors, officers and
employees in accordance with SEC and NASDAQ rules. This code of ethics can be found on the
Companys website at www.hudsonvalleybank.com. The Company intends to disclose waivers from its
code of ethics, if any, on the Companys website at www.hudsonvalleybank.com.
The Company encourages Board members to attend any Meeting of Shareholders. All Board members
were in attendance at both the most recent Annual Meeting of Shareholders held May 27, 2010.
The Nominating Committee establishes the criteria for membership on the Companys
Board of Directors and identifies, evaluates and recommends qualified individuals whose experience
and other qualifications will enhance the goals of the Company, for either appointment to the Board
or to stand for election at a meeting of the shareholders. Ms. Singer, Mr. Pratt and Mr. Thompson
serve as members of the Nominating Committee. The Nominating Committee charter adopted by the
Board of Directors can be found on the Companys website at www.hudsonvalleybank.com. As further
discussed in this section, Ms.
- 10 -
Foster, Ms. Singer and Messrs. Cahill, Holcombe, Ifshin, Pratt and Thompson meet the standards of
independence under NASDAQ rules.
Our Nominating Committee charter sets forth new director qualifications standards. The
charter states that qualified individuals are selected for, among other things, their integrity,
independence, diversity of experience, community service, their ability to exercise sound judgment,
and the ability to make the time commitment necessary to be an effective member of the Board of
Directors. The charter also provides that as a general rule, it is the desire of the Board of
Directors that directors live and/or work in the communities served by the Bank. The charter
further requires that directors be experienced in business, financially literate and respected
members of their communities, and they are expected to assist the Company in developing new
business. Moreover, directors must have high ethical and moral standards and sound personal
finances. Should a director become involved in conduct which is detrimental to the Companys
reputation, he or she should resign from the Board of Directors. Such conduct includes, among
other acts, personal bankruptcy, federal or state indictments, convictions of a crime, professional
misconduct or unethical practices. In addition, the Nominating Committee charter provides that
directors should meet both of the following stock ownership requirements: (a) directors must
beneficially own a minimum of $25,000 (market value) of the Companys stock, and (b) after 180 days
of joining the Board of Directors, directors must beneficially own a minimum of $100,000 (market
value) of the Companys stock.
Diversity is one of the factors that the Nominating Committee considers in identifying
qualified individuals for directors. In selecting qualified individuals the Nominating Committee
considers, among other factors, that the Board represents a diverse grouping of unique
qualifications of specific value to the Company. They are persons who we believe have demonstrated
leadership skills and have experience and judgment in areas that are relevant to our business. We
believe that their ability to challenge and stimulate management and their dedication to the
affairs of the Company collectively serve the interests of the Company and its shareholders. The
Nominating Committee has not adopted a formal diversity policy with regard to the selection of
qualified individuals for directors.
Shareholders may propose qualified individuals for consideration by the Companys Board of
Directors by submitting same, in writing, to the Chairman of the Nominating Committee, Hudson
Valley Holding Corp., 21 Scarsdale Road, Yonkers, New York 10707. Also see Proposals of
Shareholders and Communication with Shareholders on page 3.
The Compensation and Organization Committee is charged with the responsibility for: the annual
review and approval of all forms of compensation for the Chairman, Named Executive Officers and
other key executives of the Company and its subsidiaries, including but not limited to salary,
benefits, bonuses and equity-based compensation; the review and approval of all equity
compensation plans and amendments, including recommendation to the Board to approve such plans, and
submit them to shareholders for approval when necessary pursuant to NASDAQ Rule 5635(c); the review
and recommendation to the Board regarding the compensation polices for all employees of the
Company, the annual management incentive plans and other bonus plans proposed by management, as
well as the general compensation goals and guidelines for the Companys employees and the criteria
by which bonuses for the Companys employees are determined; the review and recommendation to the
Board regarding the Companys employment and severance policies; and review and approval of all
employment agreements for executive officers and any amendments thereto. The Committee convened 6
times in 2010. Ms. Singer and Messrs. Holcombe, Ifshin, Thompson and Cahill (effective March 1,
2011), served on this Committee. The Board of Directors has determined that each of these directors
meets the NASDAQ standards of independence. The Compensation and Organization Committee charter
adopted by the Board of Directors can be found on the Companys website at
www.hudsonvalleybank.com.
The Compensation and Organization Committee oversees the Companys compensation programs. Our
compensation programs include programs designed specifically for our executive officers. The
Committee evaluates the performance of executive officers and makes all final compensation
decisions for executive officers. The Committee utilizes independent, qualified consultants to
provide research, analysis and recommendations to the Committee regarding executive officers
compensation. The consultants assist the Committee in designing compensation plans, analyzing
industry survey and comparative data, setting
- 11 -
performance goals and determining the mix (salary, non-equity incentive award, equity
incentives) and total amount of compensation. See Executive Compensation Compensation
Discussion and Analysis beginning on page 13 of this Proxy Statement for more information
regarding the Committees role in determining executive compensation.
The Audit Committee assists the Board of Directors in fulfilling its oversight
responsibilities as to accounting policies and financial reporting practices of the Company and its
subsidiaries, the sufficiency of auditing relative thereto and the adequacy and effectiveness of
the Companys internal controls. The Committee also has responsibility for reviewing compliance
with the Companys business ethics and conflict of interest policies. The Audit Committee has the
responsibility for and authority to select and terminate the Companys independent registered
public accounting firm and approve their fees and expenses. The Audit Committee operates under a
written charter adopted by the Board of Directors which can be found on the Companys website at
www.hudsonvalleybank.com. The Committee convened 6 times in 2010. Audit Committee members were Ms.
Foster, Ms. Singer, Messrs. Ifshin, Thompson and William J. Mulrow who served until his resignation
from the Board in October 2010. The Board of Directors has determined that each of these directors
meets the enhanced NASDAQ standards of independence for Audit Committee members.
Under the requirements of the NASDAQ rules, which the Audit Committee meets, all Audit
Committee members must be able to read and understand fundamental financial statements and one
member must have the background or experience which results in financial sophistication. NASDAQ
rules do not require that the Audit Committee have a financial expert as defined in the SEC
rules. The Board of Directors does not believe that any one member of the Audit Committee meets the
qualifications to be designated a financial expert. However, the Board believes that the Audit
Committee members collectively, based upon their experience on the Companys Board as well as other
relevant experience, possess significant and necessary understanding of the Companys financial
reporting and related systems of control and are therefore effective in fulfilling their
responsibilities.
Board Leadership Structure and Role in Risk Oversight
Although our bylaws do not specifically separate the Chairman from the position of Chief
Executive Officer (CEO), William E. Griffin has been the Chairman of the Board since 1990. James
J. Landy currently serves as our CEO.
We believe it is the CEOs responsibility to run the Company and the Chairmans responsibility
to oversee the Board of Directors. As directors continue to have more oversight responsibilities
than ever before, we believe it is beneficial to have a Chairman whose sole job is leading the
Board.
Pursuant to the Companys bylaws, the Chairman, shall:
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|
supervise the carrying out of the policies adopted or approved by the Board;
|
|
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|
|
have general powers, as well as the specific powers conferred by the Companys
bylaws; and
|
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|
|
have and may exercise such further powers and duties as from time to time may be
conferred upon or assigned by the Board of Directors.
|
We believe our CEO and our Chairman have an excellent working relationship that has allowed
Mr. Landy to focus on the challenges that the Company is facing in the current business
environment. By clearly delineating the role of the Chairman position in our bylaws, we ensure
there is no duplication of effort between the CEO and the Chairman. We believe this provides strong
leadership for our Board, while also positioning our CEO as the leader of the Company in the eyes
of our customers, employees and other stakeholders.
- 12 -
Our Board has seven independent members. We have three Board committees comprised solely of
independent directors, each with a different independent director serving as chair of the
committee. We believe that the number of independent, experienced directors that make up our Board,
along with the oversight of the Board by the non-executive Chairman, benefits our Company and our
shareholders.
Our Audit Committee is primarily responsible for overseeing the Companys risk management
processes on behalf of the full Board. The Audit Committee receives reports from management at
least quarterly regarding the Companys assessment of risks. In addition, the Audit Committee
reports regularly to the full Board of Directors, which also considers the Companys risk profile.
The Audit Committee and the full Board of Directors focus on the most significant risks facing the
Company and the Companys general risk management strategy, and also ensure that risks undertaken
by the Company are consistent with this strategy. While the Board oversees the Companys risk
management, management is responsible for day-to-day risk management processes. We believe this
division of responsibilities is the most effective approach for addressing the risks facing our
Company and that our board leadership structure supports this approach.
Our Board determines the best board leadership structure for our Company. As part of our
annual Board self-evaluation process, we evaluate our leadership structure to ensure that the Board
continues to believe that it provides the optimal structure for our Company and shareholders. We
recognize that different board leadership structures may be appropriate for companies in different
situations. We believe our current leadership structure, with Mr. Landy serving as CEO and Mr.
Griffin serving as Chairman of the Board, is the optimal structure for our Company at this time.
EXECUTIVE COMPENSATION
COMPENSATION DISCUSSION & ANALYSIS
Oversight of Executive Compensation Program
The Compensation and Organization Committee of our Board of Directors (the Compensation
Committee) oversees our compensation programs. Our compensation programs include programs designed
specifically for our executive officers, including executive officers named in the Summary
Compensation Table on page 19 (the Named Executive Officers).
The Board of Directors established the Compensation Committee to, among other things,
establish, review and approve the compensation levels of Named Executive Officers, evaluate the
performance of Named Executive Officers and certain other officers and related matters for the
Company. The objectives and the goals of the Companys compensation program are to attract, retain,
motivate and reward executives capable of leading the Company in achieving its business objectives
and annual goals. The Companys program is intended to measure and reward past performance of the
Named Executive Officers and align their long-term interests with those of our shareholders.
The Compensation Committee utilizes independent, qualified consultants to assist them in the
design and administration of the compensation programs applicable to Named Executive Officers and
others. From 2005 to date, the Compensation Committee has engaged Pearl, Meyer and Partners
(PM&P) to assist them in such matters. The latest review of the Companys executive compensation
programs was conducted in 2010 with the assistance of PM&P.
In early 2009, in reaction to the then economic downturn and its negative effect on the
banking industry and the Company in particular, including the expectation that those negative
conditions would continue through at least the remainder of 2009, executive management recommended
to the Compensation Committee that base salaries of all Named Executive Officers and other
executives be reduced by 5% and all other officers salaries be frozen indefinitely. The
Compensation Committee accepted and implemented the proposal. The Compensation Committee also
decided to eliminate, for all officers, all incentive compensation programs and payments for 2009.
- 13 -
After evaluating the experience, skills and efforts needed by executive management to lead the
Company during these difficult economic times, the Compensation Committee restored the 5% reduction
in base salary of executive officers and lifted the salary freeze of all other officers effective
January 1, 2010. Further, the Compensation Committee restored to the Named Executive Officers, in
their 2010 compensation, the base salary forgone as a result of the 5% salary reduction in 2009.
The 2009 base salary restored in 2010 is shown in the 2010 bonus column for each Named Executive
Officer in the Summary Compensation Table on page 19.
Incentive compensation programs which were eliminated have not been reinstated. Rather,
during 2010, the Compensation Committee engaged its consultant, PM&P, to assist them in developing
new compensation programs. The Compensation Committee has developed new compensation programs
designed to achieve the objectives described in the section Objectives of Hudson Valley Holding
Corp.s Compensation Programs below. The new program is effective for 2011.
As a result of these actions, there were no incentive compensation programs in effect for the
Company or its Named Executive Officers during 2009 and 2010, and no incentive payments or awards
were made during 2009, with the Compensation Committee awarding limited amounts of discretionary
bonuses for 2010.
Objectives of Hudson Valley Holding Corp.s Compensation Programs
Our executive compensation objectives are to:
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Closely align executives interests with those of our shareholders;
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Attract and retain highly qualified executives that can lead the Company in
achieving its business goals;
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Recognize and differentiate individual and team performance;
|
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Balance rewards for short-term and long-term results to ensure sustainable
performance over time; and
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Encourage exceptional business performance without encouraging excessive risk
taking.
|
We have historically compensated Named Executive Officers through a combination of base
salary, non-equity incentive awards, equity participation awards, retirement plans and other
personal benefits designed to be competitive with comparable employers. As discussed above, and in
order to further our objective of aligning executive compensation with the interests of our
shareholders and the Company, no incentive compensation payments or equity awards were made to our
Named Executive Officers during 2010.
We expect that going forward, executive performance-based incentive programs (including cash
and/or equity incentive programs) will be designed to reward the achievement of specific annual,
short-term and long-term goals by the Company. Performance-based metrics are expected to be
adopted annually and used to determine achievement of goals by the Named Executive Officers. These
performance-based metrics include financial and non-financial metrics. Examples of
performance-based metrics include return on average assets, annual net income targets, increase in
loans, deposits and fee income and asset quality.
The Compensation Committee believes that the new incentive-based compensation programs
effective for 2011 are designed to reward performance over the short-term and long-term utilizing
specific performance metrics to determine achievement of performance by the Named Executive
Officers.
Compensation Consultant
In 2005, the Compensation Committee engaged PM&P, a third party compensation consultant, to
provide research, analysis and recommendations to the Compensation Committee regarding Named
Executive Officers and other officers compensation for 2005 and beyond. In 2010, PM&P performed
a
- 14 -
comprehensive review of the Companys compensation programs. The Compensation Committee
utilized the latest review to develop the compensation program effective for 2011.
The Compensation Committee intends the compensation program to accomplish the objectives
discussed under the section Objectives of Hudson Valley Holding Corp.s Compensation Programs
above. The Compensation Committee believes that given the recent changes in banking regulations,
the effect of the economic recession on the economy in general and the banking industry in
particular, the resulting termination in early 2009 by the Company of all incentive compensation
programs, as well as requirements from the SEC, a complete review of the Companys compensation
programs during 2010 was appropriate. A focus of the new compensation programs is on incentive
compensation, and to ensure that our compensation programs do not encourage excessive risk taking.
Review of Named Executive Officer Performance
Each year the Compensation Committee reviews each compensation element of the Named Executive
Officers. In each case, we take into account the scope of responsibilities and experience, and
balance them against competitive salary levels. Members of the Compensation Committee have the
opportunity to interact with the Named Executive Officers at various times during the year, which
allows the Compensation Committee to form its own assessment of each individuals performance.
This interaction is further supplemented by input from the Board which also regularly interacts
with the Named Executive Officers.
Each year the Chief Executive Officer (the CEO) presents to the Compensation Committee his
evaluation of each Named Executive Officer, which includes a review of contribution and performance
over the past year, strengths, weaknesses, development plans and succession potential. Following
this presentation, and a review of the achievement of individual and Company performance, the
Compensation Committee makes its own assessments and determines the compensation for each Named
Executive Officer.
Similarly, the Compensation Committee reviews the performance of the CEO relative to
achievement of individual and Company performance. Following such review the Compensation Committee
makes its own assessment and determines the compensation for the CEO.
For 2010, the Compensation Committees assessment of performance for each Named Executive
Officer, including the CEO, was not based upon achievement of pre-established performance-based
metrics, as the Company had not implemented an incentive compensation program in 2010. Rather, the
Compensation Committee considered the challenging economic environment affecting the banking
industry and the Company, and the experience, skills and effort needed by each Named Executive
Officer to lead the Company during 2010. As a result of this assessment, the Compensation Committee
awarded limited amounts of discretionary bonuses.
Base Salaries
The Compensation Committee utilized a 2007 review of the Companys compensation programs by
PM&P to establish base salaries of each Named Executive Officer for 2007 and 2008. This review
included PM&P providing comparative market data on compensation practices and programs based on an
analysis of banking and general industry surveys. The Compensation Committee also considered the
Companys performance as measured by achievement of performance-based metrics by each Named
Executive Officer.
In early 2009, in reaction to the then economic downturn and its negative effect on the
banking industry and the Company in particular, including the expectation that those negative
conditions would continue through at least the remainder of 2009, executive management recommended
to the Compensation Committee that base salaries of all Named Executive Officers and other
executives be reduced by 5% and all other officers salaries be frozen indefinitely. The
Compensation Committee accepted and implemented the proposal.
- 15 -
After evaluating the experience, skills and efforts needed by executive management to lead the
Company during these difficult economic times, the Compensation Committee restored the 5% reduction
in base salary of executive officers and lifted the salary freeze of all other officers effective
January 1, 2010. Further, the Compensation Committee restored to the Named Executive Officers, in
their 2010 compensation, the base salary forgone as a result of the 5% salary reduction in 2009.
The 2009 base salary restored in 2010 is shown in the 2010 bonus column for each Named Executive
Officer in the Summary Compensation Table on page 19.
Annual Incentive Plan Cash and Equity Compensation
In considering the same economic factors that led management to recommend base salary
reductions and freezes, discussed above under Base Salaries, all incentive compensation programs
were terminated for 2009 and 2010. There was no cash or equity incentive compensation program in
effect for 2009 and 2010 for the Named Executive Officers.
These incentive compensation programs have not been reinstated. Rather, the Compensation
Committee engaged its consultant, PM&P, to assist them in developing new incentive compensation
programs. The Compensation Committee developed a new incentive compensation program designed to
achieve the objectives described in the section Objectives of Hudson Valley Holding Corp.s
Compensation Programs above.
Tax Implications of Executive Compensation
Section 162(m) of the Internal Revenue Code of 1986, as amended (the Code) places a limit of
$1,000,000 on the amount of compensation that may be deducted by the Company in any year with
respect to the CEO or any other Named Executive Officer unless the compensation is
performance-based compensation as described in Section 162(m) and the related regulations. We have
qualified certain compensation paid to Named Executive Officers for deductibility under Section
162(m), including (i) certain amounts paid as incentive compensation, and (ii) certain compensation
expense related to options granted pursuant to the Companys 2002 Plan.
Although we have generally attempted to structure executive compensation so as to preserve
deductibility, we also believe that there may be circumstances where our interests are best served
by maintaining flexibility in the way compensation is provided, even if it may result in the
non-deductibility of certain compensation under the Code.
Retirement, Health and Welfare Benefits
We offer a variety of health and welfare programs to all eligible employees. The Named
Executive Officers generally are eligible for the same benefit programs on the same basis as the
rest of the eligible employees. The health and welfare programs are intended to protect employees
against catastrophic loss and encourage a healthy lifestyle. Our health and welfare programs
include medical, pharmaceutical, dental, life insurance and accidental death and disability. The
Company provides full time employees, regularly scheduled to work 30 or more hours per week,
short-term disability, long-term disability and life insurance. All employees, including Named
Executive Officers, contribute to the cost of these plans. We offer a qualified 401(k) savings and
profit sharing retirement plan. All Company employees, including Named Executive Officers, are
generally eligible for this plan. The Compensation Committee determines the contribution to the
profit sharing plan and the 401(k) matching contribution annually as reflected in the All Other
Compensation Table on page 20.
Supplemental Employee Retirement Plan
The Company provides supplemental retirement benefits to Named Executive Officers and certain
other officers. These benefits are provided through both the 1995 Supplemental Retirement Plan and
the 1997 Supplemental Retirement Plan (collectively the SERP). These plans are not qualified for
tax purposes and are available only to certain officers. Benefits under these plans are unfunded.
The SERP
- 16 -
entitles participating officers to receive supplemental retirement benefits for a period of 15
years payable on a monthly basis. The Company believes providing this benefit is important to
remain competitive with companies within the industry, to provide a competitive level of retirement
income, and to help assure orderly management succession by encouraging continued employment.
Pursuant to the 1995 Supplemental Retirement Plan, supplemental benefits equal 75% of the
officers highest base salary in any of the last three years of employment, less any retirement
plan benefits provided to him by the Company. Pursuant to the 1997 Supplemental Retirement Plan,
supplemental benefits equal 65% of the average of the highest five years annual base salary paid
to the officer during his last 10 years of employment, reduced by (1) the value of his qualified
plan account as of the date of retirement; (2) the value of his 401(k) matching benefit as of the
date of retirement; (3) 50% of his primary social security benefit; and (4) the value of any other
retirement type benefits provided to him by the Company.
Of the Named Executive Officers, Messrs. Landy and Palaia are participants in the 1995
Supplemental Retirement Plan, Messrs. Brown, Maloney and Skuthan are participants in the 1997
Supplemental Retirement Plan.
Personal Benefits
Each Named Executive Officer is provided certain additional benefits which includes the use of
a company-owned automobile. The automobile facilitates Named Executive Officers travel between our
offices, to business meetings with customers and vendors. Named Executive Officers may use the
automobile for personal transportation. Personal use of the automobile results in taxable income to
the Named Executive Officer, and we include this in the amounts of income we report to the Named
Executive Officers and the Internal Revenue Service. We also support and encourage certain Named
Executive Officers to hold a membership in one local country club for which we pay dues and other
business related expenses. We find that the club membership is an effective means of obtaining
business as it allows Named Executive Officers to interact with present and prospective customers
in a relaxed, informal environment. We require that any personal use of the country club facilities
be paid directly by the Named Executive Officers. Because the club memberships are used at our
expense only for business entertainment, we do not include them as benefits in the Summary
Compensation Table on page 19.
Severance Plan
The Company has no severance plan in place for any of its Named Executive Officers.
Employment Agreements and Arrangements
The Company has no employment agreements or employment arrangements in place for any of its
Named Executive Officers.
Change in Control Agreements
We have no Change in Control Agreements with any of the Named Executive Officers. The SERP,
provided to Named Executive Officers and certain other officers, provides for the acceleration of a
participants age under the SERP should a change in control of the Company occur. This provision is
intended to help the Company retain key employees by providing such individuals greater assurance
regarding their retirement benefits and to align the interests of shareholders and management.
Compensation of Named Executive Officers
Set forth below is information regarding compensation earned by or paid or awarded to our
Named Executive Officers during the year ended December 31, 2010: (i) James J. Landy, President and
Chief Executive Officer of the Company; (ii) Stephen R. Brown, Senior Executive Vice President,
Chief Financial Officer, Secretary and Treasurer of the Company; (iii) Michael P. Maloney,
Executive Vice President, Chief
- 17 -
Banking Officer of HVB; (iv) Vincent T. Palaia, Executive Vice President, Chief Lending
Officer of HVB; and (v) Frank J. Skuthan, Executive Vice President, Chief Operating Officer and
Marketing Director of HVB.
During 2010, the Named Executive Officers compensation consisted of a base salary, and
additional personal benefits as described for each Named Executive Officer in the Summary
Compensation Table on page 19. During 2009, the Named Executive Officers compensation consisted of
a base salary which was reduced by 5% from the prior year. The 5% reduction in 2009 salary was
restored to all Named Executive Officers in 2010. This restoration is shown in the 2010 bonus
column in the table. There were no incentive compensation programs in place for 2009 and 2010, and
therefore, no cash or equity compensation was paid to or earned by Named Executive Officers for
2009 or 2010 under these programs.
- 18 -
EXECUTIVE COMPENSATION SUMMARY COMPENSATION TABLE
The following table sets forth the compensation for each of the Named Executive Officers for
fiscal 2010, 2009 and 2008, including the dollar value of the executives: (i) annual base salary;
(ii) earned non-equity incentive award; (iii) the grant date value, in accordance with FASB ASC
Topic 718 for options, if any, granted in those years; (iv) the aggregate change in the present
value of the accumulated benefit under the non-qualified supplemental retirement plan during the
year; (v) all other compensation for the year; and (vi) the dollar value of total compensation for
the year.
Summary Compensation Table
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Change in
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Pension Value
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
and Nonqualified
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-Equity
|
|
Deferred
|
|
All Other
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Option
|
|
Incentive Plan
|
|
Compensation
|
|
Compen-
|
|
|
Name and Principal
|
|
|
|
|
|
Salary
|
|
Bonus
|
|
Awards
|
|
Compensation
|
|
Earnings
|
|
sation
|
|
Total
|
Position
|
|
Year
|
|
($)
|
|
($)
1
|
|
($)
|
|
($)
|
|
($)
|
|
($)
4
|
|
($)
|
James J. Landy
President and Chief
Executive Officer
|
|
|
2010
2009
2008
|
|
|
|
396,000
379,913
389,250
|
|
|
|
51,296
0
0
|
|
|
|
0
0
0
|
|
|
|
0
0
135,670
|
|
|
|
189,260
233,351
320,293
|
2
2
2
|
|
|
9,079
16,468
22,433
|
|
|
|
645,635
629,732
867,646
|
|
Stephen R. Brown
Senior Executive Vice President, CFO,
Secretary & Treasurer
|
|
|
2010
2009
2008
|
|
|
|
377,000
361,684
371,250
|
|
|
|
50,515
0
0
|
|
|
|
0
0
0
|
|
|
|
0
0
118,397
|
|
|
|
176,779
187,331
96,088
|
3
3
3
|
|
|
7,961
15,232
22,504
|
|
|
|
612,255
564,247
608,239
|
|
Michael P. Maloney
Executive Vice President,
Chief
Banking Officer of HVB
|
|
|
2010
2009
2009
|
|
|
|
286,825
275,173
276,300
|
|
|
|
36,803
0
36,370
|
|
|
|
0
0
0
|
|
|
|
0
0
105,000
|
|
|
|
65,837
51,022
28,003
|
3
3
3
|
|
|
9,138
16,903
24,482
|
|
|
|
398,603
343,098
441,498
|
|
Vincent T. Palaia
|
|
|
2010
|
|
|
|
276,300
|
|
|
|
36,370
|
|
|
|
0
|
|
|
|
0
|
|
|
|
252,139
|
2
|
|
|
7,454
|
|
|
|
572,263
|
|
Executive Vice President,
Chief
Lending Officer of HVB
|
|
|
2009
2008
|
|
|
|
265,075
273,600
|
|
|
|
0
0
|
|
|
|
0
0
|
|
|
|
0
107,500
|
|
|
|
149,912
154,912
|
2
2
|
|
|
14,400
19,081
|
|
|
|
429,387
555,093
|
|
Frank J. Skuthan
Executive Vice President,
Chief
Operating
Officer & Marketing
Director of HVB
|
|
|
2010
2009
2008
|
|
|
|
265,000
254,234
257,500
|
|
|
|
30,905
0
0
|
|
|
|
0
0
0
|
|
|
|
0
0
84,138
|
|
|
|
98,983
74,426
57,963
|
3
3
3
|
|
|
9,405
18,253
23,174
|
|
|
|
404,293
346,914
422,775
|
|
|
|
|
1
|
|
The Compensation and Organization Committee awarded limited discretionary cash
bonuses to Named Executive Officers for 2010 in recognition of their efforts during a
challenging economic and business year. The Company did not have a non-equity incentive
compensation plan in place in 2010. Further, the 5% reduction in 2009 salary, restored to
each Named Executive Officer in 2010 is included as a bonus. These amounts are as follows:
|
- 19 -
|
|
|
|
|
|
|
|
|
|
|
|
|
Bonus
|
|
|
Discretionary
|
|
Salary
|
|
Total
|
|
|
Bonus
|
|
Restoration
|
|
Bonus
|
Name
|
|
($)
|
|
($)
|
|
($)
|
James J. Landy
|
|
|
35,000
|
|
|
|
16,296
|
|
|
|
51,296
|
|
Stephen R. Brown
|
|
|
35,000
|
|
|
|
15,515
|
|
|
|
50,515
|
|
Michael P. Maloney
|
|
|
25,000
|
|
|
|
11,803
|
|
|
|
36,803
|
|
Vincent T. Palaia
|
|
|
25,000
|
|
|
|
11,370
|
|
|
|
36,370
|
|
Frank J. Skuthan
|
|
|
20,000
|
|
|
|
10,905
|
|
|
|
30,905
|
|
|
|
|
2
|
|
The amount shown represents the increase in the actuarial value during the year
of the supplemental pension benefit under the Companys 1995 Supplemental Retirement Plan.
|
|
3
|
|
The amount shown represents the increase in the actuarial value during the year of
the supplemental pension benefit under the Companys 1997 Supplemental Retirement Plan.
|
|
4
|
|
The following table shows the specific amounts included in the All Other
Compensation column for fiscal 2010.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
All Other Compensation
|
|
|
|
|
|
|
Employer
|
|
|
|
|
|
|
|
|
|
|
Contribution/Match
|
|
|
|
Personal Use
|
|
|
|
|
|
|
Profit-
|
|
|
|
Group Life
|
|
of Company
|
|
|
|
|
|
|
Sharing
|
|
|
|
Insurance
|
|
Provided
|
|
|
|
|
|
|
Plan
|
|
401(k) Plan
|
|
Premiums
|
|
Automobile
|
Name
|
|
Year
|
|
($)
|
|
($)
|
|
($)
|
|
($)
|
James J. Landy
|
|
|
2010
|
|
|
|
0
|
|
|
|
2,450
|
|
|
|
2,851
|
|
|
|
3,778
|
|
Stephen R. Brown
|
|
|
2010
|
|
|
|
0
|
|
|
|
2,450
|
|
|
|
2,680
|
|
|
|
2,831
|
|
Michael P. Maloney
|
|
|
2010
|
|
|
|
0
|
|
|
|
2,450
|
|
|
|
1,950
|
|
|
|
4,738
|
|
Vincent T. Palaia
|
|
|
2010
|
|
|
|
0
|
|
|
|
2,450
|
|
|
|
2,505
|
|
|
|
2,499
|
|
Frank J. Skuthan
|
|
|
2010
|
|
|
|
0
|
|
|
|
2,450
|
|
|
|
2,176
|
|
|
|
4,779
|
|
GRANT OF PLAN-BASED AWARDS
Incentive compensation programs were eliminated in 2009 and 2010, therefore no non-equity
incentive compensation or equity grants were awarded to the Named Executive Officers for 2009 and
2010.
- 20 -
OUTSTANDING EQUITY AWARDS AT FISCAL YEAR END
The following table sets forth information on outstanding stock options held by the Named
Executive Officers at December 31, 2010, including the number of shares underlying both exercisable
and unexercisable portions of each stock option as well as the exercise price and the expiration
date of each outstanding option.
Outstanding Equity Awards at December 31, 2010 Year-End Table
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Option Awards
1
|
|
|
Number of
|
|
Number of
|
|
|
|
|
|
|
securities
|
|
securities
|
|
|
|
|
|
|
underlying
|
|
underlying
|
|
Option
|
|
|
|
|
unexercised
|
|
unexercised
|
|
exercise
|
|
Option
|
|
|
options (#)
|
|
options (#)
|
|
price
|
|
expiration
|
Name
|
|
exercisable
|
|
unexercisable
|
|
($)
|
|
date
|
James J. Landy
|
|
|
3,542
|
6
|
|
|
0
|
|
|
$
|
36.50
|
|
|
|
1/1/2015
|
|
|
|
|
16,100
|
4
|
|
|
0
|
|
|
$
|
42.00
|
|
|
|
2/7/2016
|
|
|
|
|
8,196
|
2
|
|
|
2,049
|
2
|
|
$
|
56.75
|
|
|
|
12/6/2012
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Stephen R. Brown
|
|
|
3,434
|
6
|
|
|
0
|
|
|
$
|
36.50
|
|
|
|
1/1/2015
|
|
|
|
|
6,244
|
4
|
|
|
0
|
|
|
$
|
42.00
|
|
|
|
2/7/2016
|
|
|
|
|
5,925
|
2
|
|
|
1,975
|
2
|
|
$
|
56.75
|
|
|
|
12/6/2012
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Michael P. Maloney
|
|
|
2,405
|
6
|
|
|
0
|
|
|
$
|
36.50
|
|
|
|
1/1/2015
|
|
|
|
|
2,120
|
4
|
|
|
0
|
|
|
$
|
42.00
|
|
|
|
2/7/2016
|
|
|
|
|
11,472
|
2
|
|
|
2,868
|
2
|
|
$
|
56.75
|
|
|
|
12/6/2012
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Vincent T. Palaia
|
|
|
7,778
|
|
|
|
0
|
|
|
$
|
35.50
|
|
|
|
1/1/2012
|
|
|
|
|
7,071
|
|
|
|
0
|
|
|
$
|
36.50
|
|
|
|
1/1/2013
|
|
|
|
|
6,410
|
|
|
|
0
|
|
|
$
|
36.25
|
|
|
|
1/1/2014
|
|
|
|
|
5,830
|
6
|
|
|
0
|
|
|
$
|
36.50
|
|
|
|
1/1/2015
|
|
|
|
|
5,300
|
4
|
|
|
0
|
|
|
$
|
42.00
|
|
|
|
2/7/2016
|
|
|
|
|
2,880
|
2
|
|
|
720
|
2
|
|
$
|
56.75
|
|
|
|
12/6/2012
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Frank J. Skuthan
|
|
|
6,930
|
|
|
|
0
|
|
|
$
|
35.50
|
|
|
|
1/1/2012
|
|
|
|
|
5,555
|
|
|
|
0
|
|
|
$
|
36.50
|
|
|
|
1/1/2013
|
|
|
|
|
4,365
|
6
|
|
|
0
|
|
|
$
|
36.25
|
|
|
|
1/1/2014
|
|
|
|
|
3,345
|
7
|
|
|
0
|
|
|
$
|
36.50
|
|
|
|
1/1/2015
|
|
|
|
|
5,300
|
5
|
|
|
0
|
|
|
$
|
42.00
|
|
|
|
2/7/2016
|
|
|
|
|
2,160
|
3
|
|
|
1,440
|
3
|
|
$
|
56.75
|
|
|
|
12/6/2012
|
|
|
|
|
1
|
|
The number of shares underlying the options were adjusted to reflect 10%
stock dividends in December 2002, 2003, 2004, 2005, 2006, 2007, 2008, 2009, 2010, as
applicable
|
These stock option awards either vested or will vest in 20% increments as shown in the table
below:
|
|
|
|
|
|
|
|
|
|
|
Footnote
|
|
1
st
Vesting
|
|
2
nd
Vesting
|
|
3
rd
Vesting
|
|
4
th
Vesting
|
|
5
th
Vesting
|
#
|
|
Date
|
|
Date
|
|
Date
|
|
Date
|
|
Date
|
2
|
|
12/6/2007
|
|
12/6/2008
|
|
12/6/2009
|
|
12/6/2010
|
|
12/6/2011
|
3
|
|
12/6/2008
|
|
12/6/2009
|
|
12/6/2010
|
|
12/6/2011
|
|
12/6/2012
|
4
|
|
2/7/2006
|
|
2/7/2007
|
|
2/7/2008
|
|
2/7/2009
|
|
2/7/2010
|
5
|
|
2/7/2007
|
|
2/7/2008
|
|
2/7/2009
|
|
2/7/2010
|
|
2/7/2011
|
6
|
|
1/1/2005
|
|
1/1/2006
|
|
1/1/2007
|
|
1/1/2008
|
|
1/1/2009
|
7
|
|
1/1/2006
|
|
1/1/2007
|
|
1/1/2008
|
|
1/1/2009
|
|
1/1/2010
|
- 21 -
OPTION EXERCISES AND STOCK VESTED IN FISCAL 2010
|
|
|
|
|
|
|
|
|
|
|
Option Awards
|
|
|
Number of Shares
|
|
|
|
|
Acquired on
|
|
Value Realized
|
Name
|
|
Exercise
|
|
on Exercise
1
|
James J. Landy
|
|
|
0
|
|
|
|
$0
|
|
Stephen R. Brown
|
|
|
0
|
|
|
|
0
|
|
Michael P. Maloney
|
|
|
0
|
|
|
|
0
|
|
Vincent T. Palaia
|
|
|
10,887
|
|
|
|
98,960
|
|
Frank J. Skuthan
|
|
|
11,394
|
|
|
|
115,200
|
|
|
|
|
1
|
|
The value realized represents the difference between the fair market price of
underlying securities on the day of exercise and the exercise price of the options.
|
PENSION BENEFITS
The Company makes available to its Named Executive Officers a qualified 401(k) and profit
sharing retirement plan, which is available to all employees on the same terms and conditions.
The Company provides supplemental retirement benefits to certain Named Executive Officers and
other officers. These benefits are provided through both the 1995 Supplemental Retirement Plan and
the 1997 Supplemental Retirement Plan (collectively the SERP). These plans are not qualified for
tax purposes and are available only to certain officers. Benefits under these plans are unfunded.
The SERP entitles participating officers to receive supplemental retirement benefits for a period
of 15 years payable on a monthly basis.
Of the Named Executive Officers, Messrs. Landy and Palaia are participants in the 1995
Supplemental Retirement Plan, Messrs. Brown, Maloney and Skuthan are participants in the 1997
Supplemental Retirement Plan.
Pursuant to the 1995 Supplemental Retirement Plan, supplemental benefits equal 75% of the
Named Executive Officers highest base salary in any of the last three years of employment, less
any retirement plan benefits provided to him by the Company. Pursuant to the 1997 Supplemental
Retirement Plan, supplemental benefits equal 65% of the average of the highest five years annual
salary paid to the Named Executive Officer during his last 10 years of employment, reduced by (1)
the value of his qualified plan account as of the date of retirement; (2) the value of his 401(k)
matching benefit as of the date of retirement; (3) 50% of his primary social security benefit; and
(4) the value of any other retirement type benefits provided to him by the Company.
Pursuant to the SERP, the participants receive supplemental retirement benefits determined as
described above. Under the SERP the normal retirement date is defined as follows: for Messrs.
Landy, Brown and Maloney, anytime between the attainment of age 60 and age 70 with a minimum of 20
years service; for Messrs. Palaia and Skuthan, anytime between the attainment of age 65 and age 70.
No benefits vest to the participant prior to the normal retirement date except at death or
disability as defined in the SERP. Certain benefits maybe received based upon a change in control
as described in Disclosure Regarding Termination and Change in Control Provisions Potential
Payments upon Termination or Change in Control on page 23. The SERP does not provide for early
retirement nor for the crediting of extra years of service. The Company believes providing this
benefit is important to remain competitive with companies within the industry, to provide a
competitive level of retirement income, and to help assure orderly management succession by
encouraging continued employment.
- 22 -
PENSION BENEFITS IN FISCAL 2010 TABLE
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Number of
|
|
Present Value of
|
|
|
|
|
|
|
Years Credited
|
|
Accumulated
|
Name
|
|
Plan Name
|
|
Service
1
|
|
Benefit
2
|
James J. Landy
|
|
1995 Supplemental Retirement Plan
|
|
|
32
|
|
|
$
|
1,320,030
|
|
Stephen R. Brown
|
|
1997 Supplemental Retirement Plan
|
|
|
17
|
|
|
|
741,982
|
|
Michael P. Maloney
|
|
1997 Supplemental Retirement Plan
|
|
|
17
|
|
|
|
171,817
|
|
Vincent T. Palaia
|
|
1995 Supplemental Retirement Plan
|
|
|
22
|
|
|
|
1,642,803
|
|
Frank J. Skuthan
|
|
1997 Supplemental Retirement Plan
|
|
|
10
|
|
|
|
445,564
|
|
|
|
|
1
|
|
Under the terms of the 1995 and 1997 Supplemental Retirement Plans, a
participant must have 10 years credited service for pension benefit eligibility.
|
|
2
|
|
The amount shown represents the actuarial accumulated pension benefit using
the same assumption used for financial reporting purposes in our 2010 Annual Report on
Form 10-K. Retirement age is assumed to be the normal retirement date as defined in
each plan. A complete description of the 1995 and 1997 Supplemental Retirement Plans is
included in Note 12 of the Notes to the Consolidated Financial Statements in the
Companys 2010 Annual Report on Form 10-K.
|
DISCLOSURE REGARDING TERMINATION AND
CHANGE IN CONTROL PROVISIONS
Potential Payments upon Termination or Change in Control
The Company has not established any change in control, severance or employment agreements with
Named Executive Officers pursuant to which the Named Executive Officers would be paid benefits
following a change in control. Under the SERP, the participants age is accelerated upon a change
in control including a merger, consolidation or sale of substantially all the Companys assets.
Following a change of control, each participant, with at least 10 years of service, for purposes of
the SERP will be deemed to be the greater of age 60 or the participants actual age. Should the
participant be terminated without cause subsequent to such transaction, Messrs. Landy, Brown and
Maloney will be entitled to receive the full retirement benefit, Messrs. Palaia and Skuthan will be
entitled to receive a percentage of the retirement benefit as follows:
|
|
|
|
|
Age at Termination
|
|
Number of Years Service
|
|
Non Forfeiture Benefit
|
60
|
|
10 or more
|
|
50%
|
61
|
|
11 or more
|
|
60%
|
62
|
|
12 or more
|
|
70%
|
63
|
|
13 or more
|
|
80%
|
64
|
|
14 or more
|
|
90%
|
65
|
|
15 or more
|
|
100%
|
Should a change in control have occurred as of December 31, 2010 and the Named Executive
Officers been terminated without cause as of that date, the Named Executive Officers would have
been entitled to benefits under the SERP as follows:
- 23 -
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
As at December 31, 2010
|
|
|
Age deemed
|
|
|
|
|
|
|
under the
|
|
Number of
|
|
Present Value
|
Name
|
|
SERP
|
|
Years Service
|
|
of Benefit
1
|
James J. Landy
|
|
|
60
|
|
|
|
32
|
|
|
$
|
2,776,000
|
|
Stephen R. Brown
|
|
|
60
|
|
|
|
17
|
|
|
|
2,009,000
|
|
Michael P. Maloney
|
|
|
60
|
|
|
|
17
|
|
|
|
1,443,000
|
|
Vincent T. Palaia
|
|
|
63
|
|
|
|
22
|
|
|
|
1,885,000
|
|
Frank J. Skuthan
|
|
|
60
|
|
|
|
10
|
|
|
|
502,000
|
|
|
|
|
1
|
|
The amount shown represents the present value of benefits paid monthly for
15 years as determined under the SERP resulting from an assumed change in control
as of December 31, 2010.
|
Upon a change in control in which the Company is not the surviving entity, all unexercised
options under the 2002 Plan would be canceled as of the effective date of the reorganization;
provided, however, that the Compensation Committee shall give to an optionee, or the holder of the
option(s) granted under the 2002 Plan, at least 15 days written notice of the reorganization and
during this period the optionee, or the holder of the option(s), shall have the right to exercise
the unexercised option(s) under the 2002 Plan without regard to employment or directorship tenure
requirements or installment exercise limitations, if any.
Termination of Employment Due to Death or Disability
The Named Executive Officers (or their designated beneficiaries), who are participants in the
SERP, are entitled to certain benefits upon death or disability (as defined in the SERP). These
benefits entitle the Named Executive Officer or their designated beneficiary to the same retirement
benefits under the SERP to which the participant would be entitled at the normal retirement date.
Compensation Committee Report
The Compensation and Organization Committee (Committee) of the Board of Directors has
reviewed and discussed with the Companys management the Compensation Discussion and Analysis that
is required by the SEC rules to be included in this Proxy Statement. Based on that review and
those discussions, the Committee has recommended to the Companys Board of Directors that the
Compensation Discussion and Analysis beginning on page 13 be included in this Proxy Statement.
Cecile D. Singer, Chairperson
John P. Cahill
Gregory F. Holcombe
Adam W. Ifshin
Craig S. Thompson
Compensation Committee Interlocks and Insider Participation
Ms. Singer and Messrs. Cahill (effective March 1, 2011), Holcombe, Ifshin and Thompson, all of
whom are independent directors served on the Compensation and Organization Committee. Messrs.
Griffin, Ifshin, Martinelli and Thompson are shareholders and officers of firms that have performed
services for the Company. HVB has made loans to Ms. Singer and Messrs. Griffin, Brown, Holcombe,
Ifshin, Landy, Martinelli, and Thompson. See Certain Relationships and Related Transactions,
which begins on page 31. No executive officer of the Company has served as a director or a member
of a compensation committee of another company of which any member of the Committee is an executive
officer.
- 24 -
DIRECTOR COMPENSATION
The Company uses a combination of cash and stock-based incentive compensation to attract and
retain qualified individuals to serve on the Board. In setting director compensation, the Company
considers the significant amount of time that Directors expend in fulfilling their duties to the
Company, the business which they refer, as well as the skill-level required by the Company of
members of the Board. Employee directors Messrs. Landy, Brown and Maloney do not receive
Directors fees. The Compensation Committee reviews and approves all forms of compensation to the
Companys non-employee directors, including the Chairman of the Board.
Cash Compensation Paid to Board Members
Members of the Board who are not employees of the Company are entitled to receive an annual
cash retainer of $21,600 for Board membership. The Chairman of the Board receives an additional
Chairmans Fee of $35,000 as well as a Company provided car and club memberships. The Audit
Committee Chairman, the Compensation Committee Chairman and the Director liaison with the Business
Development Board New York receive an additional retainer of $4,500. The Director liaison with
the Business Development Board Connecticut receives an additional retainer of $2,250. Directors
receive attendance fees for each meeting attended, in addition to their Company retainer fee. Per
meeting attendance fees are as follows:
|
|
|
|
|
The Company and HVB Board
|
|
$
|
700
|
|
New York National Bank Board
|
|
|
675
|
|
(merged into HVB in March 2010)
|
|
|
|
|
A.R. Schmeidler & Co., Inc.
|
|
|
675
|
|
Audit Committee
|
|
|
700
|
|
All other Committees
|
|
|
275
|
|
These retainer and attendance fees were approved by the Board and made effective January 1,
2009. Non-employee directors may elect to receive up to 50% of their retainer fees in the
Companys common stock. The Company permits directors to defer all or any portion of their
retainer fees.
Stock Option Program
Non-employee options are granted at the fair market price of the stock on the date of grant.
Options received by non-employee directors vest immediately upon the option grant. Option awards
take into consideration the Boards and Committees on which each member of the Companys Board
serves and their contribution to the business.
No grants were made to non-employee directors in 2010 based upon the Companys financial
results.
Directors Retirement Plan
Directors who are not full-time employees of the Company or its subsidiaries participate in
the Directors Retirement Plan. This plan is designed to benefit all non-employee directors who
serve two or more years as a director. Benefits are paid upon a directors retirement or
resignation. The amount to be paid shall be the highest Basic Fee (as defined) paid to the
director in any one of the three prior years to the directors retirement. Benefits are payable for
a period of up to 10 years after resignation or retirement, depending on the number of years of
service as a director. Benefits under the plan are not funded.
- 25 -
The following vesting schedule determines the annual benefit to directors:
|
|
|
|
|
Percentage of Directors Fees
|
Number of Years as a Director
|
|
Payable at Retirement Age
|
Less than 2 years
|
|
0%
|
2 years but less than 3
|
|
5.0%
|
3 years but less than 4
|
|
10.0%
|
4 years but less than 5
|
|
17.5%
|
5 years but less than 6
|
|
25.0%
|
6 years but less than 7
|
|
32.5%
|
7 years but less than 8
|
|
40.0%
|
8 years but less than 9
|
|
47.5%
|
9 years but less than 10
|
|
55.0%
|
10 years but less than 11
|
|
62.5%
|
11 years but less than 12
|
|
70.0%
|
12 years but less than 13
|
|
77.5%
|
13 years but less than 14
|
|
85.0%
|
14 years but less than 15
|
|
92.5%
|
15 years or more
|
|
100%
|
Effective December 31, 2008, the Board of Directors suspended the Directors Retirement Plan.
Benefits under the Plan were determined as though the non-employee director had retired or resigned
from the Board of Directors at December 31, 2008. Based upon this change to the Plan, annual
benefits to each of the non-employee directors upon their retirement or resignation from the Board
of Directors under the Directors Retirement Plan are: $145,000 to Mr. Griffin, $57,000 to Mr.
Coogan, $39,000 to Mr. Holcombe, $77,000 to Mr. Martinelli, $18,000 to Mr. Mulrow, $55,000 to Mr.
Pratt, $65,000 to Ms. Singer and $74,000 to Mr. Thompson. Ms. Foster and Mr. Ifshin had less that 2
years service as directors at December 31, 2008, and therefore are not entitled to receive annual
benefits.
Other
We support and encourage our Chairman of the Board to hold a membership in local country clubs
for which we partially pay dues and other business related expenses. We find that club membership
is an effective means of obtaining business as it allows our Chairman to interact with present and
prospective customers in a relaxed, informal environment. We require that any personal use of the
country club facilities be paid directly by the Chairman. Because the club memberships are used at
our expense only for business entertainment, we do not include them as All Other Compensation in
the Director Compensation Table on page 27.
Mr. Pratt serves as a consultant to HVB on matters relating to business development and
retention. The consulting contract calls for Mr. Pratt to make between 30 and 40 calls per month to
HVBs high income producing customers or to customers who have the potential to attain this status.
For consulting services rendered in 2010, Mr. Pratt received a consulting fee of $85,000. In
connection with these consulting services we also provide Mr. Pratt with an automobile which is
reflected as All Other Compensation in the Directors Compensation Table on page 27.
- 26 -
Fiscal 2010 Director Compensation Table
The following table discloses the cash, equity awards and other compensation earned, paid or
awarded, as the case may be, to each of the Companys non-employee directors during the fiscal year
ended December 31, 2010. Messrs. Landy, Brown and Maloney received no separate compensation for
their service as directors and are not included in this table. The compensation received by these
individuals as executives of the Company is shown in the Summary Compensation Table on page 19.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Change in
5
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Pension Value
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
and
|
|
|
|
|
|
|
Fees
|
|
|
|
|
|
Nonqualified
|
|
|
|
|
|
|
Earned or
|
|
|
|
|
|
Deferred
|
|
|
|
|
|
|
Paid In
|
|
Option
1
|
|
Compensation
|
|
All Other
|
|
|
|
|
Cash
|
|
Awards
|
|
Earnings
|
|
Compensation
|
|
Total
|
Name
|
|
($)
|
|
($)
|
|
($)
|
|
($)
|
|
($)
|
William E. Griffin
|
|
|
154,356
|
|
|
|
0
|
2
|
|
|
51,726
|
|
|
|
9,500
|
6
|
|
|
215,582
|
|
James M. Coogan
|
|
|
23,823
|
|
|
|
0
|
2
|
|
|
0
|
|
|
|
0
|
|
|
|
23,823
|
|
Mary-Jane Foster
|
|
|
37,825
|
|
|
|
0
|
2
|
|
|
0
|
|
|
|
0
|
|
|
|
37,825
|
|
Gregory F. Holcombe
|
|
|
61,775
|
|
|
|
0
|
3
|
|
|
3,226
|
|
|
|
0
|
|
|
|
65,001
|
|
Adam W. Ifshin
|
|
|
37,500
|
|
|
|
0
|
2
|
|
|
0
|
|
|
|
0
|
|
|
|
37,500
|
|
Angelo R. Martinelli
|
|
|
72,725
|
|
|
|
0
|
4
|
|
|
0
|
|
|
|
0
|
|
|
|
72,725
|
|
William J. Mulrow
|
|
|
48,581
|
|
|
|
0
|
2
|
|
|
0
|
|
|
|
0
|
|
|
|
48,581
|
|
John A. Pratt Jr.
|
|
|
66,525
|
|
|
|
0
|
2
|
|
|
0
|
|
|
|
85,625
|
7
|
|
|
152,150
|
|
Cecile D. Singer
|
|
|
70,200
|
|
|
|
0
|
2
|
|
|
0
|
|
|
|
0
|
|
|
|
70,200
|
|
Craig S. Thompson
|
|
|
70,933
|
|
|
|
0
|
2
|
|
|
19,291
|
|
|
|
0
|
|
|
|
90,224
|
|
|
|
|
1
|
|
Amounts shown reflect the aggregate grant date fair value as determined in
accordance with FASB ASC Topic 718
|
|
2
|
|
This director did not have any exercisable or unexercisable options outstanding at
December 31, 2010.
|
|
3
|
|
Mr. Holcombe had 13,849 options outstanding at December 31, 2010, all of which
were exercisable.
|
|
4
|
|
Mr. Martinelli had 13,849 options outstanding at December 31, 2010, all of which
were exercisable.
|
|
5
|
|
Effective December 31, 2008, the Board of Directors suspended the Directors
Retirement Plan. This suspension resulted in a reduction of the projected accumulated
pension value. Despite the suspension of the Directors Retirement Plan and the freezing of
benefits, the table reflects an increase in Pension Value due to the method of accounting
for the accumulated benefit obligation.
|
|
6
|
|
Other Compensation for Mr. Griffin includes: $9,500 for personal use of a Company
provided automobile.
|
|
7
|
|
Other Compensation for Mr. Pratt includes $85,000 for his services as consultant
relating to business development and retention and $625 for personal of a Company provided
automobile.
|
- 27 -
PROPOSAL #2: NON-BINDING ADVISORY VOTE ON EXECUTIVE COMPENSATION
Under the Dodd-Frank Wall Street Reform and Consumer Protection Act enacted in July 2010 (the
Dodd-Frank Act) and Section 14A of the Securities and Exchange Act, the Companys shareholders
are entitled to vote at the Annual Meeting to approve the compensation of our named executive
officers, as disclosed in this proxy statement. This proposal is commonly referred to as a Say on
Pay proposal. Pursuant to the Dodd-Frank Act, the shareholder vote on executive compensation is
an advisory vote only, and it is not binding on the Company or the Board of Directors.
The Companys goal for its executive compensation program is to reward executives who provide
leadership for and contribute to our financial success. The Company seeks to accomplish this goal
in a way that is aligned with the long-term interests of the Companys shareholders. The Company
believes that its executive compensation program satisfies this goal.
The
Compensation Discussion and Analysis beginning on page 13 of this Proxy Statement,
describes the Companys executive compensation program and the decisions made by the Compensation
and Organization Committee in 2010 and early 2011 in detail.
The Company requests shareholder approval of the following resolution:
RESOLVED, that the compensation of the Companys Named Executive Officers as disclosed
pursuant to the SECs compensation disclosure rules (which disclosure includes the Compensation
Discussion and Analysis, and the compensation tables and narrative discussion) is hereby APPROVED:
As an advisory vote, this proposal is not binding upon the Board of Directors or the Company.
However, the Compensation and Organization Committee, which is responsible for designing and
administering the Companys executive compensation program, values the opinions expressed by
shareholders in their vote on this proposal, and will consider the outcome of the vote when making
future compensation decisions for named executive officers.
Vote Required and Board of Directors Recommendation
The consideration of an advisory vote to approve the compensation of Named Executive Officers
requires the favorable vote of a majority of the votes cast. Abstentions and broker non-votes, if
any, will have no effect on determining whether the proposal has received the requisite number of
affirmative votes.
OUR BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS A VOTE FOR THE
NON-BINDING APPROVAL OF THE COMPENSATION OF THE NAMED EXECUTIVE
OFFICERS AS DETERMINED BY THE COMPENSATION AND ORGANIZATION
COMMITTEE.
PROPOSAL # 3: ADVISORY VOTE ON THE FREQUENCY OF VOTING ON EXECUTIVE
COMPENSATION
The Dodd-Frank Act Say-on-Pay rules and Section 14A of the Securities Exchange Act also
enable our shareholders by means of an advisory vote to indicate how frequently the Company should
seek an advisory vote on the compensation of our named executive officers. By voting on this
proposal, shareholders may indicate whether they would prefer a vote on Named Executive Officer
compensation once every one, two, or three years.
After careful consideration of this proposal, the Companys Board has determined that an
advisory vote on executive compensation that occurs every year is the most appropriate alternative
for the Company, and therefore our Board recommends that you vote for a one-year interval for the
advisory vote on executive compensation.
- 28 -
In formulating its recommendation, the Companys Board considered that an annual advisory vote
on executive compensation will allow our shareholders to provide us with their direct input on our
compensation philosophy, policies and practices as disclosed in the proxy statement every year.
You may cast your vote on your preferred voting frequency by choosing the option of one year,
two years, three years or abstain from voting.
The option of one year, two years or three years that receives the highest number of votes
cast by shareholders will be the frequency for the advisory vote on executive compensation that has
been selected by shareholders. However, because this vote is advisory and not binding on the
Companys Board or the Company in any way, the Board may decide that it is in the best interests of
our shareholders and the Company to hold an advisory vote on executive compensation more or less
frequently than the option approved by our shareholders.
Vote Required and Board of Directors Recommendation
The consideration of an advisory vote to approve frequency of holding an advisory vote on
executive compensation requires the favorable vote of a majority of the votes cast. Shareholders
are being asked to indicate their choice of one year, two years or three years, the option that
receives the highest number of votes cast by shareholders will be the frequency for the advisory
vote on executive compensation that has been selected by shareholders. Abstentions and broker
non-votes will have no effect on determining the outcome of this proposal.
OUR BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS A VOTE FOR THE OPTION
OF EVERY YEAR AS THE FREQUENCY WITH WHICH SHAREHOLDERS ARE PROVIDED
AN ADVISORY VOTE ON EXECUTIVE COMPENSATION.
Audit Committee Report
In accordance with its written charter adopted by the Board of Directors, the Audit Committee
(the Committee), which consists entirely of independent directors, assists the Board of Directors
in fulfilling its responsibility for oversight of the quality and integrity of the accounting,
auditing and financial reporting practices of the Company.
In discharging its oversight responsibility as to the audit process, the Committee has
received from our independent registered public accounting firm the written disclosures and letter
required by the applicable requirements of the Public Company Account Oversight Board, regarding
the independent accountants communications with the Committee concerning independence and has
discussed with the independent accountant the independent accountants independence. The Committee
discussed with the independent registered public accounting firm any relationships that may impact
their objectivity and independence, including fees for non-audit services, and satisfied itself as
to the firms independence.
Pursuant to Section 404 of the Sarbanes-Oxley Act, management is required to prepare as part
of the Companys 2010 Annual Report on Form 10-K a report by management on its assessment of the
Companys internal control over financial reporting, including managements assessment of the
effectiveness of such internal control. Crowe Horwath LLP (Crowe) has issued an audit report
relative to internal control over financial reporting. During the course of fiscal 2010,
management regularly discussed the internal control review and assessment process with the Audit
Committee, including the framework used to evaluate the effectiveness of such internal controls,
and at regular intervals updated the Audit Committee on the status of this process and actions
taken by management to respond to issues identified during this process. The Audit Committee also
discussed this process with Crowe. Managements assessment report and the auditors audit report
are included as part of the Companys 2010 Annual Report on Form 10-K.
The Committee discussed and reviewed with the independent registered public accounting firm
all communications required by generally accepted auditing standards, including those described in
Statement
- 29 -
on Auditing Standards No. 61, as amended, Communications with Audit Committees and, with and
without management present, discussed and reviewed the independent auditors audit of the financial
statements. The Committee also discussed the results of the internal audit examinations.
The Committee reviewed and discussed the audited financial statements of the Company as of and
for the year ended December 31, 2010, with management and the independent registered public
accounting firm. Management has the responsibility for the preparation of the Companys financial
statements and the independent registered public accounting firm has responsibility for the audit
of those statements.
Based on the above-mentioned review and discussions with management and the independent
registered public accounting firm, the Committee recommended to the Board of Directors that the
Companys audited financial statements be included in its Annual Report on Form 10-K for the year
ended December 31, 2010, for filing with the SEC. The Committee has reappointed Crowe as the
Companys independent registered public accounting firm for the year ending December 31, 2011. In
making its determination, the Committee considered qualifications, price and quality of service.
Craig S. Thompson, Chairman
Mary-Jane Foster
Adam W. Ifshin
Cecile D. Singer
PROPOSAL # 4: RATIFICATION OF THE APPOINTMENT OF INDEPENDENT REGISTERED
PUBLIC ACCOUNTING FIRM
Crowe Horwath LLP (Crowe) audited our financial statements for the years ended December 31,
2009 and December 31, 2010. The Companys board of directors has unanimously recommended that
Crowe be appointed our independent registered public accounting firm for the year ended December
31, 2011. Representatives of Crowe, the Companys independent registered public accounting firm,
are expected to attend the annual meeting of shareholders, will have the opportunity to make a
statement if they so desire and will be available to respond to appropriate questions.
Independent Registered Public Accounting Firms Fees
Set forth below is a summary of the fees paid for the years ended December 31, 2010 and
December 31, 2009 to the Companys independent registered public accounting firms:
|
|
|
|
|
|
|
|
|
|
|
2010
|
|
|
2009
|
|
Audit Fees
|
|
$
|
220,500
|
|
|
$
|
215,750
|
|
Audit-related fees
1
|
|
|
132,000
|
|
|
|
92,500
|
|
Tax fees
2
|
|
|
53,750
|
|
|
|
79,100
|
|
All other fees
3
|
|
|
110,632
|
|
|
|
158,000
|
|
|
|
|
|
|
|
|
Total
|
|
$
|
516,882
|
|
|
$
|
545,350
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
1
|
|
Audit of internal controls over financial reporting and other related matters
|
|
|
|
|
|
|
|
|
|
|
|
|
2010
|
|
|
2009
|
|
|
2
|
|
Tax fees
|
|
|
|
|
|
|
|
|
|
|
|
Tax return preparation and review
|
|
|
53,750
|
|
|
$
|
48,500
|
|
|
|
|
Tax consulting tax research
|
|
|
|
|
|
|
30,600
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
53,750
|
|
|
$
|
79,100
|
|
|
|
|
|
|
|
2010
|
|
|
2009
|
|
|
3
|
|
All other fees
|
|
|
|
|
|
|
|
|
|
|
|
The Company paid Crowe fees relating to the
implementation of captive insurance company in
2010
|
|
$
|
110,632
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
The Company paid Crowe fees relating to common
stock offering in 2009 $111,000 and Deloitte $47,000
|
|
|
|
|
|
$
|
158,000
|
|
- 30 -
Pre-Approval Policies
In accordance with the procedures set forth in its charter, the Audit Committee approves in
advance all audit services and permitted non-audit services (including the fees and terms of those
services) to be performed for the Company by its independent registered public accounting firm.
All services must be submitted to the Committee for approval in writing, generally in the form of
an engagement letter, which outlines the services to be performed and the associated fees. All of
the fees and services described above were pre-approved by the Audit Committee.
Vote Required and Board of Directors Recommendation
Ratification of the appointment of Crowe requires the favorable vote of a majority of the
votes cast. Abstentions and broker non-votes, if any, will have no effect on determining whether
the proposal has received the requisite number of affirmative votes.
OUR BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS A VOTE FOR
RATIFICATION OF THE APPOINTMENT OF CROWE AS THE COMPANYS INDEPENDENT
REGISTERED PUBLIC ACCOUNTING FIRM FOR 2011.
Section 16(a) Beneficial Ownership Reporting Compliance
Section 16(a) of the Securities Exchange Act of 1934 requires the Companys officers,
directors and persons beneficially owning more than 10% of a registered class of the Companys
equity securities to file reports of ownership and changes in ownership with the SEC, and to
furnish to the Company copies of such reports. Based solely on the review of copies of the forms
received, the Company believes that, during the last fiscal year, all filing requirements under
Section 16(a) applicable to its officers, directors and 10% shareholders were timely, except for
the inadvertent late filing of a Form 4 for Mary-Jane Foster reflecting the purchase of shares by
the Reporting Person on February 12, 2010, for which a Form 4 was filed on February 23, 2010.
TRANSACTIONS WITH RELATED PERSONS
Loans to Officers, Directors and 5% Shareholders
HVB makes loans to the Companys executive officers, directors and 5% Shareholders, and
immediate family members or businesses with which they are associated, in the ordinary course of
business. Such loans are made on the same terms and conditions, including interest rate and
collateral, as those prevailing at the same time for comparable transactions with other persons not
related to the lender. None of the loans involves more than the normal risk of collectability or
presents other unfavorable features. The aggregate amount outstanding for all such loans was
$42,368,040 in 2010. (This aggregate amount reflects the full amount outstanding, portions of which
are participated to other banks).
Certain Other Related Party Transactions
Messrs. Griffin and Coogan, Chairman of the Board and a former director of the Company,
respectively are shareholders of the law firm of Griffin, Coogan Blose & Sulzer, P.C., which serves
as the Companys general counsel. Griffin, Coogan, Blose & Sulzer, P.C. received fees approximating
$1,203,000 in 2010 for legal services performed on behalf of the Company and its subsidiaries. Of
this amount $404,853 was paid directly by the Company.
- 31 -
Mr. Thompson, a director of the Company, is the President and principal shareholder of
Thompson Pension Employee Plans, Inc., which has written life insurance policies supporting the
Companys obligations under the supplemental retirement plans for executive officers. The total
annual premiums approximated $319,650 in 2010.
Mr. Martinelli, a director of the Company, is the Chairman of the Board of the Gazette Press,
Inc., which received fees approximating $99,000 in 2010 in exchange for printing services provided
to the Company and its subsidiaries.
Mr. Ifshin, a director of the Company, is President and CEO of DLC Management Corp. which
received rent payments approximating $112,011 for the rental of office space by subsidiaries of the
Company.
Mr. Pratt, a director of the Company, received $85,000 in consulting fees and $625 for
personal use of a Company provided automobile in connection with certain business development and
retention activities performed for the benefit of the Company.
Policies Regarding Transactions with Related Persons
The Board of Directors has established and annually approves a written policy governing
transactions with related persons. The Company, in the normal course of business, retains the
services of various product and service providers. It is our policy to purchase appropriate and
necessary products and services at competitive prices and with service quality appropriate to meet
our needs. We desire to do business, whenever possible, with those individuals and businesses that
are customers of ours, including related persons, provided that such business transactions are
concluded on an arms length basis and comply with applicable law regarding such transactions.
In selecting a service or product provider, the Company considers various criteria, including:
|
|
|
whether the provider is a customer of the Company,
|
|
|
|
|
whether the provider has previously supplied the Company with goods or services,
|
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|
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the providers knowledge of the Company and our needs specific to the product or
service to be rendered,
|
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|
|
the providers qualifications, reputation and capability, and
|
|
|
|
|
the total cost of the product or service to be provided.
|
The Company expects that products or services provided by related persons will be of at least
the same quality and competitively priced with those available from non-related persons, including
consideration of the items listed above. The Company takes reasonable and appropriate steps to
evaluate the pricing, quality and capability of product and service providers, including related
persons.
- 32 -
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
The following table sets forth the beneficial ownership (as that term is defined in the
rules of the SEC) of the common stock as of March 31, 2011, by (a) each Named Executive Officer and
member of the Board of Directors, (b) persons known to be a beneficial owner of more than five
percent of the common stock and (c) all executive officers and members of the Board of Directors as
a group. Persons who hold options that are exercisable within 60 days of March 31, 2011 are deemed
to own, beneficially, the shares of common stock that may be acquired on the exercise of such
options. Such shares are deemed outstanding for purposes of computing the number of shares owned by
the person holding the option, but not for any other purpose.
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|
|
|
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|
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|
|
|
|
|
|
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|
|
|
Amount and
|
|
Percent of
|
|
|
|
|
|
|
Nature of
|
|
Outstanding
|
|
|
|
|
|
|
Beneficial
|
|
Shares of Common
|
Name
|
|
Address
|
|
Ownership
|
|
Stock
|
Gregory F. Holcombe
1
|
|
35 E. Grassy Sprain Road, Yonkers, NY 10710
|
|
|
1,594,666
|
(1)
|
|
|
9.0
|
%
|
Marie A. Holcombe
1
|
|
35 E. Grassy Sprain Road, Yonkers, NY 10710
|
|
|
1,594,666
|
(1)
|
|
|
9.0
|
|
James J. Veneruso
2
|
|
35 E. Grassy Sprain Road, Yonkers, NY 10710
|
|
|
1,233,670
|
(2)
|
|
|
7.0
|
|
William E. Griffin.
|
|
|
|
|
|
|
549,652
|
|
|
|
3.1
|
|
Stephen R. Brown
|
|
|
|
|
|
|
105,540
|
(3)
|
|
|
*
|
|
John P. Cahill
|
|
|
|
|
|
|
1,200
|
(4)
|
|
|
*
|
|
Mary-Jane Foster
|
|
|
|
|
|
|
4,353
|
|
|
|
*
|
|
Adam W. Ifshin
|
|
|
|
|
|
|
49,123
|
|
|
|
*
|
|
James J. Landy
|
|
|
|
|
|
|
231,212
|
(5)
|
|
|
1.3
|
|
Michael P. Maloney
|
|
|
|
|
|
|
21,347
|
(6)
|
|
|
*
|
|
Angelo R. Martinelli
|
|
|
|
|
|
|
380,085
|
(7)
|
|
|
2.2
|
|
John A. Pratt Jr.
|
|
|
|
|
|
|
169,817
|
(8)
|
|
|
*
|
|
Cecile D. Singer
|
|
|
|
|
|
|
122,081
|
(9)
|
|
|
*
|
|
Craig S. Thompson
|
|
|
|
|
|
|
206,166
|
(10)
|
|
|
1.2
|
|
Vincent T. Palaia
|
|
|
|
|
|
|
165,275
|
(11)
|
|
|
*
|
|
Frank J. Skuthan
|
|
|
|
|
|
|
40,188
|
(12)
|
|
|
*
|
|
All directors and executive
officers as a
group (18
persons).
|
|
|
|
|
|
|
3,703,327
|
(13)
|
|
|
20.7
|
%
|
|
|
|
*
|
|
Less than 1% of the outstanding shares of common stock.
|
|
1
|
|
Gregory F. Holcombe and his wife, Marie A. Holcombe (the daughter of Josephine
Abplanalp) have shared voting and dispositive power over 1,594,666 shares which includes
(i) 665,876 shares owned by BMW Machinery Co., Inc. (of which Mrs. Holcombe is the
principal shareholder and Mr. Holcombe is an officer); (ii) 520,000 owned by Eldred
Preserve, LLC (a New York limited liability company for which Mrs. Holcombe and James J.
Veneruso serve as co-managers); (iii)128,232 shares held by The Josephine Abplanalp
Revocable Living Trust (for which Mrs. Holcombe, James J. Veneruso and Josephine Abplanalp
serve as a co-trustee); (iv) 119,825 shares held in trusts for the benefit of the children
of Mr. and Mrs. Holcombe (for which Mrs. Holcombe and James J. Veneruso serve as
co-trustee); and (v) 6,849 shares held by the Heidi Foundation Inc. (of which Mr. and Mrs.
Holcombe are directors); (vi) 4,492 shares held in trusts for the benefit of the children
of Mr. and Mrs. Holcombe for which James J. Veneruso is the trustee; (vii) 1,367 shares
held by an Irrevocable Insurance Trust for which James J. Veneruso is the trustee; (viii)
1,442 shares held by the Holcombe Family Trust for which James J. Veneruso is the trustee;
(ix) 3,132 shares for which Mr. Holcombe is custodian for their children; (x) 128,794
shares held by Mr. & Mrs. Holcombe as joint tenants; (xi) 535 shares held by Mrs.
Holcombe; (xii) 273 shares held by Mr. Holcombe and (xiii) 13,849 shares which may be
acquired Mr. Holcombe upon the exercise of options, and 7,484 of these shares are pledged
as collateral.
|
- 33 -
|
|
|
2
|
|
Mr. Veneruso holds shared voting and dispositive power over the following shares:
(i) 520,000 shares held by Eldred Preserve, LLC (a New York limited liability company for
which Marie A. Holcombe and Mr. Veneruso serve as co-managers); (ii) 119,825 shares held
shares held in trusts for the benefit of the children of Gregory F. Holcombe and Marie A.
Holcombe (for which Marie A. Holcombe and Mr. Veneruso serve as co-trustee); (iii) 4,492
shares held in irrevocable trusts for the benefit of the daughters of Gregory F. Holcombe
and Marie A. Holcombe for which Mr.
Veneruso is the trustee; (iv) 1,367 shares held by an Irrevocable Insurance Trust for which
Mr. Veneruso is the trustee; (v) 1,442 shares held in the 2004 Holcombe Family Irrevocable
Trust for which Mr. Veneruso is the trustee; and (vi) 11,774 held jointly with his spouse.
The number of shares reported above also includes 147 shares held by Mr. Venerusos son as
to which he disclaims beneficial ownership. In addition, Mr. Veneruso holds sole voting and
dispositive power over (i) 8,129 shares directly held by him; (ii) 16,494 shares in an IRA;
and (iii) 550,000 shares held by the Josephine Abplanalp Irrevocable Retained Annuity Trust
(the holdings of which are deemed indirectly beneficially owned by Mr. Veneruso, who is the
sole trustee).
|
|
3
|
|
Includes 15,603 shares which may be acquired upon the exercise of options; and
24,253 shares pledged as collateral
|
|
4
|
|
under our Nominating Committee charter, Mr. Cahill is expected to purchase
additional shares within 6 months
|
|
5
|
|
Includes 27,838 shares which may be acquired upon the exercise of options; and
55,000 shares pledged as collateral.
|
|
6
|
|
Includes 15,997 shares which may be acquired upon the exercise of options.
|
|
7
|
|
Includes 13,849 shares which may be acquired upon the exercise of options. 167,099
shares are pledged as collateral.
|
|
8
|
|
Includes 20,485 shares held by the family of Mr. Pratts adult son, as to which
Mr. Pratt disclaims beneficial ownership.
|
|
9
|
|
Includes 64,306 shares pledged as collateral.
|
|
10
|
|
Includes 129,340 shares pledged as collateral.
|
|
11
|
|
Includes 35,269 shares which may be acquired upon the exercise of options, and
pledged 17,173 as collateral.
|
|
12
|
|
Includes 27,655 shares which may be acquired upon the exercise of options.
|
|
13
|
|
Includes 206,878 shares which may be acquired upon the exercise of options.
|
- 34 -
OTHER MATTERS
The Board of Directors is not aware of any other matters that may come before the annual
meeting. However, in the event such other matters come before the meeting, it is the intention of
the persons named in the proxy to vote on any such matters in accordance with the recommendation of
the Board of Directors.
Shareholders are urged to vote their shares by telephone 1-866-776-5649 inside the United
States, through the internet www.proxyvotenow.com/huvl or sign the enclosed proxy and return it in
the enclosed envelope. The proxy is solicited on behalf of the Board of Directors.
By
Order of the Board of Directors
Stephen R. Brown
Secretary
Yonkers, New York
April 8, 2011
A copy of the Companys Annual Report on Form 10-K (including the financial statements and the
financial statement schedules without exhibits) for the year ended December 31, 2010 filed with the
SEC has been furnished to shareholders with this Proxy Statement. Additional copies are available
upon written request addressed to Wendy Croker, First Vice President, Shareholder Relations, Hudson
Valley Holding Corp., 21 Scarsdale Road, Yonkers, New York 10707. The Companys Annual Report on
Form 10-K (without exhibits) is also available on the Companys website at
www.hudsonvalleybank.com. Upon written request to the Company, at the address above, the exhibits
set forth on the exhibit index of the Companys Annual Report on Form 10-K will be made available
at reasonable charge (which will be limited to our reasonable expenses in furnishing such
exhibits).
- 35 -
REVOCABLE PROXY
Hudson Valley Holding Corp.
ANNUAL MEETING OF SHAREHOLDERS
May 12, 2011
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
The shareholder of record hereby appoints Angelo R. Martinelli, Cecile D. Singer and Craig S.
Thompson, and any one of them, with full power of substitution, as Proxies for the shareholder, to
attend the Annual Meeting of the Shareholders of Hudson Valley Holding Corp. (the Company), to be
held at the Companys headquarters at 21 Scarsdale Road, Yonkers, New York on Thursday, May 12,
2011 at 10:30 AM, local time, and any adjournments thereof, and to vote all shares of the common
stock of the Company that the shareholder is entitled to vote upon each of the matters referred to
in this Proxy and, at their discretion, upon such other matters as may properly come before this
meeting.
This Proxy, when properly executed, will be voted in the manner directed herein by the
shareholder of record. If no direction is made, this Proxy will be voted FOR all Proposals and an
Annual Vote on Proposal 3.
PLEASE COMPLETE, DATE, SIGN, AND MAIL THIS PROXY CARD PROMPTLY IN THE ENCLOSED
POSTAGE-PAID ENVELOPE OR PROVIDE YOUR INSTRUCTIONS TO VOTE VIA
THE INTERNET OR BY TELEPHONE.
(Continued, and to be marked, dated and signed, on the other side)
ê
FOLD AND DETACH HERE
ê
HUDSON VALLEY HOLDING CORP. ANNUAL MEETING, MAY 12, 2011
YOUR VOTE IS IMPORTANT!
Annual Meeting Materials are available on-line at:
www.proxydocs.com/huvl
You can vote in one of three ways:
1.
|
|
Call
toll free 1-866-776-5649
on a Touch-Tone Phone. There is
NO CHARGE
to you for this call.
|
or
2.
|
|
Via the Internet at
https://www.proxyvotenow.com/huvl
and follow the instructions.
|
or
3.
|
|
Mark, sign and date your proxy card and return it promptly in the enclosed envelope.
|
PLEASE SEE REVERSE SIDE FOR VOTING INSTRUCTIONS
6948
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x
|
|
PLEASE MARK VOTES
AS IN THIS EXAMPLE
|
|
REVOCABLE PROXY
HUDSON VALLEY HOLDING CORP.
|
|
Annual Meeting of Shareholders
MAY 12, 2011
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With-
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|
For All
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For
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|
hold
|
|
Except
|
1.
|
|
The election as directors of all nominees listed (except as
marked to the contrary below):
|
|
c
|
|
c
|
|
c
|
|
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|
|
(01) William E. Griffin
|
|
(02) James J. Landy
|
|
(03) Stephen R. Brown
|
(04) John P. Cahill
|
|
(05) Mary-Jane Foster
|
|
(06) Gregory F. Holcombe
|
(07) Adam W. Ifshin
|
|
(08) Michael P. Maloney
|
|
(09) Angelo R. Martinelli
|
(10) John A. Pratt Jr.
|
|
(11) Cecile D. Singer
|
|
(12) Craig S. Thompson
|
INSTRUCTION: To withhold authority to vote for any
nominee(s), mark For All Except and write that nominee(s)
name(s) or number(s) in the space provided below.
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|
Please be sure to date and sign
this proxy card in the box below.
|
Date
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Sign above
|
|
Co-holder (if any) sign above
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For
|
|
Against
|
|
Abstain
|
2.
|
|
Non-binding advisory vote to approve the compensation of
named executive officers
|
|
c
|
|
c
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|
c
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One Year
|
|
Two Years
|
|
Three Years
|
|
Abstain
|
3.
|
|
Non-binding advisory vote on frequency of future
advisory votes on compensation of named executive
officers (proposing annual vote)
|
|
c
|
|
c
|
|
c
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|
c
|
|
|
|
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|
For
|
|
Against
|
|
Abstain
|
4.
|
|
Ratify appointment of Crowe Horwath LLP as Companys
independent registered public accounting firm for fiscal year
ending December 31, 2011
|
|
c
|
|
c
|
|
c
|
THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR EACH
OF THE LISTED PROPOSALS AND AN ANNUAL VOTE ON PROPOSAL 3.
|
|
|
Mark here for address change and note change
|
|
c
|
Note: Please sign exactly as your name appears on this Proxy.
If signing for estates, trusts, corporations or partnerships,
title or capacity should be stated.
If shares are held jointly, each holder should sign.
IF YOU WISH TO PROVIDE YOUR INSTRUCTIONS TO VOTE BY TELEPHONE OR INTERNET, PLEASE READ THE INSTRUCTIONS BELOW
|
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é
|
FOLD AND DETACH HERE IF YOU ARE VOTING BY MAIL
|
é
|
|
PROXY VOTING INSTRUCTIONS
Shareholders of record have three ways to vote:
1. By Mail; or
2. By Telephone (using a Touch-Tone Phone); or
3. By Internet.
A telephone or Internet vote authorizes the named proxies to vote your shares in the same manner as
if you marked, signed, dated and returned this proxy. Please note telephone and Internet votes must
be cast prior to 3 a.m., May 12, 2011. It is not necessary to return this proxy if you vote by
telephone or Internet.
Vote by Telephone
Call Toll-Free on a Touch-Tone Phone anytime prior to
3 a.m., May 12, 2011
1-866-776-5649
Vote by Internet
anytime prior to
3 a.m., May 12, 2011 go to
https://www.proxyvotenow.com/huvl
Please note that the last vote received, whether by telephone, Internet or by mail, will be the vote counted.
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ON-LINE ANNUAL MEETING MATERIALS:
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www.proxydocs.com/huvl
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