-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, TtGCM+pf/cMD7k6PrDtA5cjhRYFDrws8+j/y9m2zoJ6ILaEG0MnGQC94IdtuRGDY MTv7/QBvEghxvMOuNxOypA== 0001275287-05-005095.txt : 20051222 0001275287-05-005095.hdr.sgml : 20051222 20051222142659 ACCESSION NUMBER: 0001275287-05-005095 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 3 CONFORMED PERIOD OF REPORT: 20051221 ITEM INFORMATION: Entry into a Material Definitive Agreement ITEM INFORMATION: Other Events ITEM INFORMATION: Financial Statements and Exhibits FILED AS OF DATE: 20051222 DATE AS OF CHANGE: 20051222 FILER: COMPANY DATA: COMPANY CONFORMED NAME: ASTORIA FINANCIAL CORP CENTRAL INDEX KEY: 0000910322 STANDARD INDUSTRIAL CLASSIFICATION: SAVINGS INSTITUTION, FEDERALLY CHARTERED [6035] IRS NUMBER: 113170868 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 8-K SEC ACT: 1934 Act SEC FILE NUMBER: 001-11967 FILM NUMBER: 051281520 BUSINESS ADDRESS: STREET 1: ONE ASTORIA FEDERAL PLAZA CITY: LAKE SUCCESS STATE: NY ZIP: 11042-1085 BUSINESS PHONE: 5163273000 MAIL ADDRESS: STREET 1: ONE ASTORIA FEDERAL PLAZA CITY: LAKE SUCCESS STATE: NY ZIP: 11042-1085 8-K 1 af4372.txt FORM 8-K ================================================================================ UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 ---------- FORM 8-K CURRENT REPORT ---------- Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 Date of report (Date of earliest event reported): December 21, 2005 ---------- ASTORIA FINANCIAL CORPORATION (Exact name of registrant as specified in its charter) ---------- Delaware 001-11967 11-3170868 (State or other jurisdiction of (Commission (IRS Employer incorporation or organization) File Number) Identification No.) ONE ASTORIA FEDERAL PLAZA, LAKE SUCCESS, NEW YORK 11042-1085 (Address of principal executive offices, including zip code) Registrant's telephone number, including area code: (516) 327-3000 NOT APPLICABLE (Former name or former address, if changed since last report) Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below): [ ] Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) [ ] Soliciting material pursuant to Rule 14a-12(b) under the Exchange Act (17 CFR 240.14a-12(b)) [ ] Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) [ ] Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) ================================================================================ ITEMS 2 THROUGH 7 NOT APPLICABLE. ITEM 1.01 ENTRY INTO A MATERIAL DEFINITIVE AGREEMENT. a) Option Vesting Acceleration On December 21, 2005, Astoria Financial Corporation's (the "Company") Compensation Committee and Board of Directors approved the acceleration of vesting of all outstanding unvested stock options which were awarded to officers of Astoria Federal Savings and Loan Association (the Association) on December 17, 2003 (the "2003 Options") and December 15, 2004 (the "2004 Options"). At the time of the acceleration, the unvested 2003 Options represented 1,402,950 shares, each with an exercise price of $24.40 per share, the fair market value of the Company's Common Stock on the date of grant, and, absent earlier vesting due to the death, disability or retirement of the optionee or a change of control of the Company, would have vested on January 10, 2007. The six executive officers of the Company hold 2003 Options which account for 786,750 shares. At the time of the acceleration, the unvested 2004 Options represented 1,897,200 shares, each with an exercise price of $26.6267 per share, the fair market value of the Company's Common Stock on the date of grant, and, absent earlier vesting due to the death, disability or retirement of the optionee or a change of control of the Company, would have vested on January 10, 2008. The six executive officers of the Company hold 2004 Options which account for 1,063,500 shares. The Company placed a restriction on the sale or other transfer of shares acquired through the exercise of 2003 Options or 2004 Options, the vesting of which was accelerated, prior to the earlier of the original vesting date or the date the optionee terminates employment with the Company and the Association. The acceleration was effective on December 22, 2005. The purpose of the acceleration is to enable the Company to eliminate compensation expense associated with these options in future periods upon adoption of FASB Statement No.123R, Share Based Payment, in January 2006. It is anticipated that the accelerated vesting will eliminate potential pre-tax compensation expense in future periods of approximately $10.4 million, or approximately $.06 per share after-tax based upon diluted weighted average shares outstanding for the quarter ended September 30, 2005, including pre-tax compensation expense of approximately $6.7 million in 2006 or approximately $0.04 per share after-tax based upon diluted weighted average shares outstanding for the quarter ended September 30, 2005. As a result of the acceleration, the Company will incur in 2005 approximately $100,000 pre-tax compensation expense. A number of the options which were accelerated, when granted, were intended to qualify as incentive stock options. The accelerated vesting will for most affected optionees disqualify such options upon exercise from incentive stock option tax treatment. The Company, upon the exercise of such disqualified options, may realize certain tax benefits that would not have otherwise been available to it. b) Option Grants and Restricted Stock Awards to the Executive Officers -2- Pursuant to the terms of the 2005 Re-designated, Amended and Restated Stock Incentive Plan for Officers and Employees of Astoria Financial Corporation, which was approved by the shareholders of the Company at its Annual Meeting of Shareholders on May 18, 2005, the Compensation Committee of the Board of Directors on December 21, 2005 granted the following non-statutory stock options and shares of restricted stock to the executive officers of the Company:
Name Title Options Granted Restricted Stock Awarded - ---------------------- ---------------------------- --------------- ------------------------ George L. Engelke, Jr. Chairman, President and 345,000 30,000 Chief Executive Officer Monte N. Redman Executive Vice President 154,700 16,575 and Chief Financial Officer Gerard C. Keegan Vice Chairman and Chief 122,900 13,150 Administrative Officer Arnold K. Greenberg Executive Vice President 112,700 12,075 Alan P. Eggleston Executive Vice President, 103,800 11,125 Secretary and General Counsel Gary T. McCann Executive Vice President 84,000 9,000 All officers, as a group 1,224,100 196,828
The options granted have an exercise price of $29.02, the fair market value of the Company's Common Stock on the date of grant, a 7 year term and vest on January 9, 2009 or earlier upon the optionee's death, disability, retirement at normal retirement age, on a change of control, or, in the case of the executive officers, pursuant to the terms of their respective employment agreements with the Company, upon the termination of their employment by the Company prior to the end of the term of such employment agreement without cause, as defined therein. In other cases, the options would be forfeited upon termination of employment prior to the vesting date. The restricted stock will vest and be distributed effective January 9, 2009 or earlier upon the death, disability or retirement at normal retirement age, on a change of control, or, in the case of the executive officers, pursuant to the terms of their respective employment agreements with the Company, upon the termination of their employment by the Company prior to the end of the term of such employment agreement without cause, as defined therein. In other cases, the restricted stock award would be forfeited upon termination of employment prior to the vesting date. Prior to the vesting date and forfeiture, if any, of such award, the recipient of the award will be eligible to exercise voting rights with respect to such shares and receive cash dividends, if any, declared and paid by the Company with respect to its Common Stock. c) Executive Officer Employment Contract related issues. Following meetings of the Compensation Committees of the Boards of Directors of the Company and the Association held on December 16, 2005 and December 21, 2005, and a meeting of the non-management directors of the Company on December 21, 2005, the Board of Directors of the Association extended the employment agreements of the six executive officers by one year so that the term of such contracts is three years each. The employment contracts between the six executive officers and the Company absent notice by either party automatically renew each day to maintain their term at three years at all times. -3- In addition, the Board of Directors, following such meetings, also approved salary increases for 2006 for the six executive officers as follows: Name 2005 Salary 2006 Salary - ----------------------- ----------- ----------- George L. Engelke, Jr. $ 1,050,000 $ 1,100,000 Monte N. Redman $ 570,000 $ 600,000 Gerard C. Keegan $ 502,000 $ 524,000 Arnold K. Greenberg $ 463,000 $ 483,000 Alan P. Eggleston $ 420,000 $ 445,000 Gary T. McCann $ 375,000 $ 400,000 Prior to granting the equity based compensation noted above, extending the Association employment agreements and establishing the 2006 salaries for the executive officers, the Compensation Committee retained the services of Watson Wyatt to, among other things review the reasonableness of such compensation. The Compensation Committee also considered the performance and accomplishments of the executives and the Company during 2005, reviewed the aggregate compensation paid to each of the executive officers over the preceding three years, the executive's investment in the Company and compensation that would be due such executive under a variety of termination scenarios. d) Amendment of the Astoria Federal Savings and Loan Association and Astoria Financial Corporation Director Retirement Plan. On December 21, 2005, the Boards of Directors of the Company and the Association approved amendments to the Astoria Federal Savings and Loan Association and Astoria Financial Corporation Director Retirement Plan (the "Astoria Plan"). The amendments among other things were designed to resolve certain ambiguities in the Astoria Plan regarding the amount of benefit payable to an eligible director upon retirement and the integration of the Astoria Plan with director retirement plans provided by companies that have merged into the Company or the Association, specifically The Greater New York Savings Bank in 1997 and Long Island Bancorp and Long Island Savings Bank in 1998. Eligible participants in the Astoria Plan include all current directors of the Company except for those directors who are or ever have been an employee of the Company, the Association or any company merged into either of them. This excludes from participation in the Astoria Plan the following directors of the Company: George L. Engelke, Jr. Gerard C. Keegan, John J. Conefry, Jr. and Thomas V. Powderly. In 1999, participation in the Astoria Plan was frozen such that any director who first joins the Board of Directors of the Company or the Association after March 1, 1999 will not be eligible to participate in the Astoria Plan. -4- Benefits under the Astoria Plan vest at a 50% level once an eligible director completes 10 years of service. Vesting increases by 5% each additional year of service thereafter with 100% vesting after 20 years of service. The Astoria Plan was amended to clarify that for purposes of the Astoria Plan service on the Board of Directors of companies merged into the Company or the Association is counted as eligible service under the Astoria Plan. Any benefit which a director receives pursuant to a retirement plan for service on the Board of Directors of a company merged into the Company or the Association pursuant to a plan established by such merged company acts as an offset against the benefit due the director pursuant to the Astoria Plan. The directors affected by this clarification are Robert J. Conway and Leo J. Waters, each former Long Island Bancorp and Long Island Savings Bank directors and Peter C. Haeffner, Jr., a former director of The Greater New York Savings Bank. The Plan was also amended to clarify the basic benefit payable under the plan and in certain cases to provide benefit payment options. The basic benefit payable under the Astoria Plan is a monthly benefit for the life of a director commencing at retirement from the Boards of Directors of the Company and the Association or age 65, whichever is later, which on an annual basis is equal the sum of (i) the annual retainers paid by the Company and the Association to their directors at the time the director retires, (ii) any annual retainers the director was receiving from the Company and the Association for service as the chairman of a committee of the Boards of Directors of the Company or the Association at the time the director retires, and (iii) a sum equal to the meeting fees paid to the director for committee meeting attendance in the year preceding the director's retirement. Directors, prior to December 31, 2005, will be allowed to elect alternate forms of benefit payment for their benefits under the Astoria Plan. The alternate forms of benefit, in addition to the single life annuity described above, are (i) a 10 year certain annuity, (ii) a joint and survivor annuity with the director's spouse, and (iii) a lump sum payment. The amount of the alternate forms of benefits is calculated to be actuarially equivalent to the basic single life annuity benefit described above. For those directors entitled to receive benefits under director retirement plans established by companies merged into the Company or the Association, the director must select a form of benefit payment under the Astoria Plan that is the same as the form provided pursuant to the plan established by the company merged into the Company or the Association, i.e. a 10 year certain annuity in the case of Messrs. Conway and Waters and a joint and survivor annuity in the case of Mr. Haeffner. If an eligible director dies while in service as a director of the Company or the Association, no benefits are due the director under the Astoria Plan. In the event of a change of control, as defined in the Astoria Plan, eligible directors will receive service credit through the balance of their then current term as a director. Prior to December 31, 2005, eligible directors will be required to elect whether, in the event of a change of control, their benefits due pursuant to the Astoria Plan shall be paid to the director in a lump sum or transferred into a rabbi trust to be established at that time and paid pursuant to the original alternate form benefit election. The directors who are eligible to participate in the Astoria Plan, at this time, have the following vesting percentage: Andrew M. Burger: 100% Denis J. Connors: 75% Robert J. Conway 100% Thomas J. Donahue: 75% Peter C. Haeffner, Jr. 65% Ralph Palleschi 0% Leo J. Waters 75% -5- A copy of the Astoria Federal Savings and Loan Association and Astoria Financial Corporation Director Retirement Plan, as amended, is attached to this Form 8-K as Exhibit 10.1. The description set forth above is subject in its entirety to the terms and conditions set forth in such plan. ITEM 8.01 OTHER EVENTS On December 21, 2005, the Board of Directors of Astoria Financial Corporation authorized a ten million share repurchase plan. The new plan will commence upon completion of the current repurchase program. On December 22, 2005, Astoria Financial Corporation issued a press release announcing the new stock repurchase plan, a copy of which is included herein under exhibit 99.1 ITEM 9.01. FINANCIAL STATEMENTS AND EXHIBITS. (c) Exhibits. Exhibit 10.1 Directors' Retirement Plan Exhibit 99.1 Press release dated December 22, 2005. -6- SIGNATURE Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized. ASTORIA FINANCIAL CORPORATION By: /s/ Peter J. Cunningham ------------------------------- Peter J. Cunningham First Vice President and Director of Investor Relations Dated: December 22, 2005 -7- EXHIBIT INDEX EXHIBIT NUMBER DESCRIPTION - ------- ------------------------------------- 10.1 Directors' Retirement Plan 99.1 Press release dated December 22, 2005 -8- EX-10.1 2 af4372ex101.txt EXHIBIT 10.1 Exhibit 10.1 ASTORIA FEDERAL SAVINGS AND LOAN ASSOCIATION AND ASTORIA FINANCIAL CORPORATION DIRECTORS' RETIREMENT PLAN EFFECTIVE JANUARY 1, 1990, AS AMENDED AND RESTATED EFFECTIVE JANUARY 1, 2005 1. Directors eligible to participate ("Eligible Directors") in this Directors' Retirement Plan (the "Plan") shall only be those who retire from the latter of the Board of Directors of Astoria Federal Savings and Loan Association (the "Association") and Astoria Financial Corporation (the "Company") and are not or were not full-time employees of the Association or institutions merged with the Association prior to the formation of the Company, or of companies merged with or acquired by the Association or Company thereafter. 2. The mandatory retirement age for members of the Board of Directors of the Association shall be as set forth in the Bylaws of the Association, as amended from time to time, as in effect on January 1, 1990 or, if later, the date on which the individual became an Eligible Director. 3. The mandatory retirement age for members of the Board of Directors of the Company shall be as set forth in the Bylaws of the Company, as amended from time to time, as in effect on January 1, 2004 or, if later, the date on which the individual became an Eligible Director. 4. For purposes of determining benefits (the "Monthly Benefits") under Paragraph 5 hereof the following definitions shall apply; (a) Full Years of Service shall be the greater of years of service for the Board of Directors of the Association or the Company. Years of Service on the Board of Directors of an Acquired Company shall be recognized as Years of Service with the Association or the Company in the case of any Eligible Director who (i) served on the Board of Directors of an Acquired Company immediately prior to its acquisition by the Association or the Company and (ii) became a member of the Board of Directors of the Association or the Company immediately upon such acquisition. In the event of a Change of Control (as defined below), Years of Service shall be computed as if the Eligible Director's service had continued through May 31st of the calendar year in which the Eligible Director's current term would expire. (b) Monthly Fee for any Eligible Director as of any date shall mean the aggregate of the following: (i) one-twelfth of the annual retainer(s) rate in effect for service as a director of the Boards of Directors of the Association and the Company, (ii) one-twelfth of the annual retainer in effect for service as chairman of a committee of the Boards of Directors of the Association and the Company of which such Eligible Director is chairman; and (iii) one-twelfth of the aggregate per-meeting fees (if any) actually paid to such Eligible Director for attendance at meetings of the Board of Directors of the Association and the Company and any committees thereof during the twelve consecutive calendar month period ending with the month that includes the date in question. (c) Acquired Company shall mean Fidelity New York, F.S.B., The Greater New York Savings Bank, Long Island Bancorp, Inc, and The Long Island Savings Bank, FSB. 5. The Monthly Benefit to which an Eligible Director shall be entitled shall be based upon the following vesting schedule: Full Years of Monthly Benefit, calculated by multiplying Service the percentage below by the Monthly Fee -------------- -------------------------------------------- Less than 10 0% 10 50% 11 55% 12 60% 13 65% 14 70% 15 75% 16 80% 17 85% 18 90% 19 95% 20 or more 100% In the case of an Eligible Director who has received or is eligible to receive a benefit under another director retirement plan for service as a director of an Acquired Company, the Monthly Benefit payable under this Plan (when expressed as a single life annuity) shall be reduced by the monthly benefit paid or payable under such other plan (when expressed as a single life annuity payable at the same time as the Monthly Benefit is payable under this Plan). Except as provided below with respect to Monthly Benefits which become payable following a Change of Control (as defined below), the Monthly Benefit shall be paid as follows: (a) Normal Retirement: Monthly Benefits shall be paid monthly commencing on the first day of the month following retirement upon reaching the later of the mandatory retirement ages set forth in the Bylaws of the Company and the Association as in effect on January 1, 2004 and January 1, 1990, respectively, or, if later, the date on which the individual became an Eligible Director. -2- (b) Early Retirement: Monthly Benefits shall be paid monthly commencing on the later of the first day of the month following retirement or the first day of the month following attainment of age 65. For purposes of the Plan and subject to Paragraph 11, Early Retirement shall include all manner and means by which an Eligible Director ceases to serve as a director of the Company and the Association, excluding only normal retirement, removal for cause or death. 6. The Plan is intended to be an unfunded plan and the Monthly Benefits will be paid as due by the Association from its general assets. 7. In the event that an Eligible Director's service on the Boards of Directors of the Company and the Association ceases as a result of such Eligible Director's disability, the Monthly Benefit to which such Eligible Director would otherwise have been entitled pursuant to the Plan may, at the discretion of the Board of Directors of the Association, be increased to an amount up to 100% of the Monthly Fee received by the Eligible Director and the timing of such payment shall be accelerated to the first day of the calendar month immediately following cessation of service due to disability. Disability for this purpose shall mean any medically determinable physical or mental impairment which can be expected to result in death or to last for a continuous period of at least twelve (12) months and as a result of which either: (a) the Eligible Director is unable to engage in any substantial gainful activity or (b) the Eligible Director has been receiving income replacement benefits for a period of at least three (3) months under an accident and health plan covering employees of the Eligible Director's employer, as determined by the Board of Directors of the Association in accordance with section 409A of the Internal Revenue Code of 1986, as amended (the "Code") and the regulations thereunder. 8. All benefits payable to an Eligible Director pursuant to the Plan shall terminate with the monthly payment made for the month that includes the date of death of the Eligible Director, unless the Eligible Director elects that benefits be paid in one of the following optional forms: (a) a single lump sum payment (b) fixed monthly installments for 120 months (c) a joint and 100% survivor annuity An election of an optional form of payment shall be in writing in the form and manner determined by the Board of Directors of the Association and must be made prior to the later of (i) commencement of participation in the Plan and (ii) January 1, 2006. An Eligible Director who is also entitled to a benefit under another plan for service as a director of The Long Island Savings Bank, FSB or Long Island Bancorp, Inc. shall be deemed to have elected fixed monthly installments for 120 months. An Eligible Director who is also entitled to a benefit under another plan for service as a director of The Greater New York Savings Bank shall be deemed to have elected a joint and 100% survivor annuity form of payment with his spouse as his contingent annuitant. The amount of any optional form of payment shall be determined by, and on the basis of, reasonable interest rate and mortality assumptions prescribed by an enrolled actuary selected by the Board of Directors of the Association such that the actuarial present value of the payments made under the optional form of payment are equivalent to the actuarial present value of the payments that would be made in the form of a single life annuity. -3- Where an Eligible Director elects a form of payment with a guaranteed minimum number of payments, the Eligible Director may designate a beneficiary or beneficiaries for any payments remaining to be made at the time of his death by filing a written notice with the Corporate Secretary prior to the Eligible Director's death, in such form and manner as the Corporate Secretary may prescribe. An Eligible Director who has designated a beneficiary or beneficiaries may change or revoke such designation prior to the Eligible Director's death by means of a similar written instrument. Where an Eligible Director elects a joint and survivor annuity form of payment, the Eligible Director may designate a contingent annuitant by filing a written notice with the Corporate Secretary prior to the Eligible Director's death, in such form and manner as the Corporate Secretary may prescribe. An Eligible Director who has designated a contingent annuitant may change or revoke such designation prior to the commencement of payments or the Eligible Director's death (whichever is earlier) by means of a similar written instrument. If no beneficiary shall have been designated or if any such designation shall be ineffective, or in the event that no designated beneficiary survives the Eligible Director, payments due to a beneficiary shall be paid in a single lump sum to the Eligible Director's personal representative, or if no personal representative is appointed within six (6) months after the Eligible Director's death or such longer period as the Board of Directors of the Association deems reasonable in its discretion, to his surviving spouse, or if he has no surviving spouse, to his then living descendants, per stirpes. If any Eligible Director and any one or more of his designated beneficiary(ies) shall die in circumstances that leave substantial doubt as to who shall have been the first to die, the Eligible Director shall be deemed to have survived the deceased Beneficiary(ies). The presence of substantial doubt for such purposes shall be determined by the Board of Directors of the Association in its sole and absolute discretion. If the Eligible Director's designated contingent annuitant does not survive him, then no survivor benefit shall be paid under a joint and survivor annuity form of payment. 9. (a) A Change of Control means, with respect to an Eligible Director: (a) a change in ownership of the Eligible Director's Service Recipient; (b) a change in effective control of the Eligible Director's Service Recipient; or (c) a change in the ownership of a substantial portion of the assets of the Eligible Director's Service Recipient. Service Recipient means with respect to an Eligible Director on any date: (i) the corporation for which the Eligible Director is performing services on such date; (ii) all corporations that are liable to the Eligible Director for the benefits due to him under the Plan; (iii) a corporation that is a majority shareholder of a corporation described in section (i) or (ii) above; or (iv) any corporation in a chain of corporations each of which is a majority shareholder of another corporation in the chain, ending in a corporation described in section (i) or (ii) above. The existence of a Change of Control shall be determined by the compensation committee of the Board of Directors of the Company (the "Committee") in accordance with section 409A of the Code and the regulations thereunder. -4- (b) In the event of a Change of Control, the Association shall pay: (i) To the Eligible Director, not later than thirty (30) days following the Change of Control or upon the Eligible Director's termination of service as a director of the Company and the Association, whichever is later, a lump sum payment equal to the present value of the Monthly Benefits to which such Eligible Director is then entitled under the Plan, where such present value is determined using the mortality tables prescribed under section 415(b)(2)(E)(v) of the Code and a discount rate, compounded monthly, equal to the annualized rate of interest prescribed by the Pension Benefit Guaranty Corporation for the valuation of immediate annuities payable under terminating single-employer defined benefit plans (or, if no such rate is prescribed, the rate prescribed under section 417(e)(3) of the Code) for the month in which the Eligible Director's termination of service as a director occurs; or (ii) If elected by the Eligible Director in writing prior to the date of commencement of participation in the Plan or, if later, January 1, 2006, to a trust fund to be established for the benefit of the Eligible Director at the time of the Change of Control, with a trustee selected by the Eligible Director, an amount actuarially determined to be sufficient to pay to the Eligible Director the Monthly Benefit provided pursuant to the Plan as such benefit would be payable to the Eligible Director under the terms of the Plan but for the Change of Control. To the extent of any payment under Paragraph 9(b)(i), the Association shall have no further liability with respect to the payment of benefits to the Eligible Director under the Plan. The Association shall continue to be liable for the payment of benefits under the Plan to the extent of any shortfall in the funds held in trust for the payment of benefits pursuant to Paragraph 9(b)(ii). To the extent that upon the conclusion of the payment from the trust of all benefits due to an Eligible Director under the Plan there is an excess in the funds held in trust for the benefit of the Eligible Director, such excess shall be returned to the Association. (c) The Association shall pay all taxes, trustee's fees and other administrative charges or expenses associated with the establishment or continuance of such trust fund. 10. (a) Whenever appropriate in the Plan, words used in the singular may be read in the plural, words in the plural may be read in the singular, and words importing the masculine gender shall be deemed equally to refer to the feminine or the neuter. Any reference to a Paragraph shall be to a Paragraph of the Plan, unless otherwise indicated. -5- (b) The right to receive a benefit under the Plan shall not be subject in any manner to anticipation, alienation or assignment, nor shall rights be liable for or subject to debts, contracts liabilities or torts. This Plan shall be binding upon the Association and its successors and assigns, including any successor by merger or consolidation or a statutory receiver or other person or firm or corporation to which all or substantially all of the assets and business of the Association may be sold or otherwise transferred. (c) The Association shall indemnify, hold harmless and defend its Eligible Directors against their reasonable costs, including legal fees, incurred by them or arising out of any action, suit or proceeding in which they may be involved, as a result of their efforts, in good faith, to defend or enforce terms of the Plan. (d) A determination that any provision of the Plan is invalid or unenforceable shall not effect the validity or enforceability of any other provision hereof. (e) Failure to insist upon strict compliance with any terms, covenants or conditions of the Plan shall not be deemed a waiver of such term, covenant or condition. A waiver of any provision of the Plan must be in writing, designated as a waiver, and signed by the party against whom enforcement is sought. Any waiver or relinquishment of any right or power hereunder at any one or more times shall not be deemed a waiver or relinquishment of such right or power at any other time or times. (f) The Plan shall be construed, administered and enforced according to the laws of the State of New York without giving effect to the conflict of laws principles thereof, except to the extent that such laws are preempted by federal law. The federal and state courts having jurisdiction in Nassau, Suffolk and New York Counties, New York shall have exclusive jurisdiction over any claim, action, complaint or lawsuit brought under the terms of the Plan or in any way relating to the rights or obligations of any person under, or the acts or omissions of the Board of Directors of the Company and/or the Association or any duly authorized person acting in their behalf in relation to, the Plan. By accepting participation in this Plan, the Eligible Director, for himself and any other person claiming any rights under the Plan through him, agrees to submit himself, and any such legal action described herein that he shall bring, to the sole jurisdiction of such courts for the adjudication and resolution of such disputes. The filing of any action, suit or proceeding in any other jurisdiction shall result in a forfeiture of all benefits due under the Plan to or in respect of the person making such filing. (g) The Association shall have the right to retain a sufficient portion of any payment made under the Plan to cover the amount required to be withheld pursuant to any applicable federal, state and local tax law. -6- (h) Nothing in this Plan shall be held or construed to establish any deposit account for any Eligible Director or any deposit liability on the part of the Association. An Eligible Directors' rights hereunder shall be equivalent to those of a general unsecured creditor. (i) The Plan may be amended or terminated at any time by resolution of the Board of Directors of the Company and the Board of Directors of the Association. If the Plan is terminated, no further benefits shall be earned, but benefits earned through the termination date will continue to be paid at the times and in the manner provided under the Plan. (j) The Plan shall be administered by the Committee. The Committee shall have the exclusive right to interpret the Plan and to decide any matters arising in connection with the administration and operation of the Plan and to take all other necessary and proper actions to fulfill its duties as administrator. Any action taken or omitted by the Committee with respect to the Plan, including any decision, interpretation, claim denial or review on appeal, shall be conclusive and binding on the Company, the Association and Eligible Directors. The Committee shall not be liable for any actions by it under the Plan, unless due to its own negligence, willful misconduct or lack of good faith. The Committee shall be indemnified and held harmless by the Company and/or the Association from and against all personal liability to which it may be subject by reason of any act done or omitted to be done in its official capacity as administrator in good faith in the administration of the Plan, including all expenses reasonably incurred in its defense in the event the Company and/or the Association fails to provide such defense upon the request of the Committee. The Committee is relieved of all responsibility in connection with its duties hereunder to the fullest extent permitted by law, short of breach of duty. 11. Notwithstanding anything herein contained to the contrary, any payments or benefits provided to an Eligible Director pursuant to this Plan by the Association are subject to and conditioned upon compliance with Section 18K of the Federal Deposit Insurance Act, 12 U.S.C. Section 1825(k), and any regulations promulgated thereunder. 12. The Plan is intended to be a non-qualified deferred compensation plan described in section 409A of the Code. The Plan shall be operated, administered and construed to give effect to such intent. In addition, the Plan shall be subject to amendment, with or without advance notice to Eligible Directors and other interested parties, and on a prospective or retroactive basis, including but not limited to amendment in a manner that adversely affects the rights of Eligible Directors and other interested parties, to the extent necessary to effect such compliance. -7- Dated: December 21, 2005 ASTORIA FEDERAL SAVINGS AND LOAN ASSOCIATION By: George L. Engelke, Jr. ------------------------------ George L. Engelke, Jr. President and Chief Executive Officer Dated: December 21, 2005 ASTORIA FINANCIAL CORPORATION By: George L. Engelke, Jr. ------------------------------ George L. Engelke, Jr. President and Chief Executive Officer -8- EX-99.1 3 af4372ex991.txt EXHIBIT 99.1 Exhibit 99.1 [LOGO OF ASTORIA FINANCIAL CORPORATION] One Astoria Federal Plaza, Lake Success, NY 11042-1085(516)327-3000 NEWS RELEASE Contact: Peter J. Cunningham First Vice President, Investor Relations 516-327-7877 FOR IMMEDIATE RELEASE ir@astoriafederal.com ASTORIA FINANCIAL CORPORATION ANNOUNCES NEW 10 MILLION SHARE REPURCHASE PROGRAM Lake Success, New York, December 22, 2005 -- Astoria Financial Corporation (NYSE: AF) announced that its Board of Directors approved the Company's eleventh stock repurchase program which authorizes the purchase of ten million shares, or approximately 10% of its outstanding common stock, in open-market or privately negotiated transactions. The newly approved repurchase program will commence immediately upon completion of the current stock repurchase program of which 322,300 shares remain. George L. Engelke, Jr., Chairman, President and Chief Executive Officer of Astoria Financial commented, "In approving the new stock repurchase authorization, the Board of Directors is demonstrating its commitment to enhancing shareholder value and providing the Company with continued flexibility in capital management." Astoria Financial Corporation, the holding company for Astoria Federal Savings and Loan Association, with assets of $22.6 billion is the sixth largest thrift institution in the United States. Established in 1888, Astoria Federal is the largest thrift depository headquartered in New York with deposits of $12.8 billion and embraces its philosophy of Putting people first by providing the customers and local communities it serves with quality financial products and services through 86 convenient banking office locations and multiple delivery channels, including its enhanced website, www.astoriafederal.com. Astoria Federal commands the fourth largest deposit market share in the attractive Long Island market, which includes Brooklyn, Queens, Nassau and Suffolk counties with a population exceeding that of 39 individual states. Astoria Federal originates mortgage loans through its banking offices and loan production offices in New York, an extensive broker network in twenty-three states, primarily the East Coast and the District of Columbia, and through correspondent relationships in forty-four states and the District of Columbia. -----END PRIVACY-ENHANCED MESSAGE-----