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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-K
Annual Report Pursuant to Section 13 or 15(d)
of the Securities Exchange Act of 1934
For the Fiscal Year Ended December 31, 2003 Commission File No. 000-23537
PEAPACK-GLADSTONE FINANCIAL CORPORATION
(Exact name of registrant as specified in its charter)
New Jersey 22-2491488
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
158 Route 206
Peapack-Gladstone, New Jersey 07934
(Address of principal executive offices) (Zip Code)
Registrant's telephone number (908) 234-0700
Securities registered pursuant to Section 12(b) of the Act:
Title of Each Class Name of Exchange on which Registered
------------------- ------------------------------------
Common Stock, No par value American Stock Exchange
Securities registered pursuant to Section 12(g) of the Act:
NONE
Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the preceding 12 months (or for such shorter period that the registrant was
required to file such reports), and (2) has been subject to such filing
requirements for the past 90 days. Yes |X| No |_|.
Indicate by check mark if disclosure of delinquent filers pursuant to Item 405
of Regulation S-K is not contained herein, and will not be contained, to the
best of registrant's knowledge, in definitive proxy or information statements
incorporated by reference in Part III of this Form 10-K or any amendment of this
Form 10-K |X|.
Indicate by check mark whether the Registrant is an accelerated filer (as
defined in Exchange Act Rule 12b-d). Yes |X| No |_|.
The aggregate market value of the shares held by unaffiliated stockholders was
approximately $202,485,524 on June 30, 2003.
As of February 29, 2004, 7,426,246 shares of no par value Common Stock were
outstanding.
DOCUMENTS INCORPORATED BY REFERENCE
Portions of the Corporation's 2003 Annual Report (the "2003 Annual Report") and
Definitive Proxy Statement for the Corporation's 2004 Annual Meeting of
Shareholders (the "2004 Proxy Statement") are incorporated by reference into
Parts II and III.
FORM 10-K
PEAPACK-GLADSTONE FINANCIAL CORPORATION
For the Year Ended December 31, 2003
Table of Contents
PART I
Item 1. Business ............................................................................... 3
Item 2. Properties ............................................................................. 7
Item 3. Legal Proceedings ...................................................................... 7
Item 4. Submission of Matters to a Vote of Security Holders .................................... 7
Item 4A. Executive Officers of the Registrant ................................................... 7
PART II
Item 5. Market for the Registrant's Common Stock and Related Shareholders Matters .............. 8
Item 6. Selected Financial Data ................................................................ 8
Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations .. 8
Item 7A. Quantitative and Qualitative Disclosure About Market Risk .............................. 8
Item 8. Financial Statements and Supplementary Data ............................................ 8
Item 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosure ... 9
Item 9A. Controls and Procedures ................................................................ 9
PART III
Item 10. Directors and Executive Officers of the Registrant ..................................... 9
Item 11. Executive Compensation ................................................................. 9
Item 12. Security Ownership of Certain Beneficial Owners and Management ......................... 10
Item 13. Certain Relationships and Related Transactions ......................................... 10
PART IV
Item 14. Principal Accountant Fees and Services ................................................. 10
Item 15. Exhibits, Financial Statements, and Reports on Form 8-K ................................ 10
Signatures ............................................................................. 12
2
This Form 10-K contains certain forward-looking statements with respect to the
financial condition, results of operations and business of the Corporation. Such
statements are not historical facts and include expressions about the
Corporation's confidence, strategies and expectations about earnings, new and
existing programs and products, relationships, opportunities, technology and
market conditions. These statements may be identified by forward-looking
terminology such as "expect," "believe," or "anticipate," or expressions of
confidence like "strong," or "on-going," or similar statements or variations of
such terms. Factors that may cause actual results to differ materially from
those contemplated by such forward looking statements include, among others, the
following possibilities:
o Unexpected decline in the direction of the economy in New Jersey.
o Unexpected decline or no increase in interest rates.
o Continued unexpected loan prepayment volume.
o Decline in the levels of loan quality and origination volume.
o Decline in the volume of increase in trust assets or deposits.
The Corporation assumes no responsibility to update such forward-looking
statements in the future.
PART I
Item 1. DESCRIPTION OF BUSINESS
The Corporation
Peapack-Gladstone Financial Corporation (the "Corporation") is a bank holding
company registered under the Bank Holding Company Act of 1956, as amended
("Holding Company Act"). The Corporation was organized under the laws of New
Jersey in August, 1997, by the Board of Directors of Peapack-Gladstone Bank (the
"Bank"), its principal subsidiary, to become a holding company for the Bank. The
Bank is a state chartered commercial bank founded in 1921 under the laws of the
State of New Jersey. Deposits of the Bank are insured for up to $100,000 per
depositor by the Bank Insurance Fund administered by the FDIC. The Bank is a
member of the Federal Reserve System. The Bank offers financial services through
sixteen full-service banking offices, and one mini-branch. The Bank maintains
eight (8) branches and one (1) auxiliary office in Somerset County, two (2) in
Hunterdon County and six (6) in Morris County.
The Bank is primarily dedicated to providing quality, personalized financial,
trust and investment services to individuals and small businesses.
Commercial loan customers of the Bank are business people, including merchants,
architects, doctors, dentists, attorneys and building contractors as well as
various service firms and other local retailers. Most forms of commercial
lending are offered, including working capital lines of credit, term loans for
fixed asset acquisitions, commercial mortgages and other forms of asset-based
financing.
In addition to commercial lending activities, the Bank offers a wide range of
consumer banking services, including: checking and savings accounts, money
market and interest-bearing checking accounts, certificates of deposit, and
individual retirement accounts held in certificates of deposit. The Bank also
offers residential and construction mortgages, home equity lines of credit and
other second mortgage loans. For children, the Bank offers a special pony club
savings account. New Jersey Consumer Checking Accounts are offered to low income
customers. In addition, the Bank provides foreign and domestic travelers'
checks, personal money orders, cashier's checks and wire transfers. Automated
teller machines are available at sixteen (16) locations. Via the automatic
teller machine access card issued by the Bank, customers may pay for commodities
at point-of-sale merchant locations. Internet banking is available to customers
including an on-line bill payment option. The Corporation has no foreign
operations.
The Bank's Trust and Investment Department, PGB Trust and Investments, is an
important function of the Bank. PGB Trust and Investments offers personal
investment management services, personal trust administration services, estate
settlement, income tax services, custodial services and other financial planning
services. Since its inception in 1972, trust assets (book value) have increased
to more than $1 billion.
The Corporation makes its Annual Report on Form 10-K, Quarterly Reports on Form
10-Q and Current Reports on Form 8-K, and amendments to such reports, available
on its website at www.pgbank.com.
3
Employees
As of December 31, 2003, the Corporation employed 209 full-time equivalent
persons. Management considers relations with employees to be satisfactory.
Principal Market Areas
The Bank's principal market for its deposit gathering activities includes
Somerset, Morris and Hunterdon Counties. The area is composed of upper-income
single family homes, moderate income properties, some low-income housing and
several large corporate campuses. There are numerous small retail businesses in
each of the towns as well as offices for various professionals, i.e. attorneys,
architects, interior decorators, physicians, etc. A portion of the market area
is bisected by Interstate Highways 287 and 78 where numerous corporate offices
have relocated over the past 25 years.
The Bank has expanded its service areas from one office in 1968 to the present
sixteen (16) full-service banking locations and one (1) mini-branch location by
steadily opening new branches. All of the communities that the Bank serves are
demographically similar and contiguous to the main office.
Competition
The market for banking and bank-related services is highly competitive. The Bank
competes with other providers of financial services such as other bank holding
companies, commercial and savings banks, savings and loan associations, credit
unions, money market and mutual funds, mortgage companies, and a growing list of
other local, regional and national institutions which offer financial services.
Mergers between financial institutions within New Jersey and in neighboring
states have added competitive pressure. The Bank competes by offering quality
products and convenient services at competitive prices. In order to maintain and
enhance its competitive position, the Bank regularly reviews its products,
locations and new branching prospects.
Governmental Policies and Legislation
The banking industry is highly regulated. Statutory and regulatory controls
increase a bank holding company's cost of doing business and limit the options
of its management to deploy assets and maximize income. Proposals to change the
laws and regulations governing the operations and taxation of banks, bank
holding companies and other financial institutions are frequently made in
Congress, in state legislatures and before various bank regulatory agencies. The
likelihood of any major changes and the impact such changes might have on the
Corporation or the Bank is impossible to predict. The following discussion is
not intended to be a complete list of all the activities regulated by the
banking laws or of the impact of such laws and regulations on the Bank. It is
intended only to briefly summarize some material provisions.
Capital Requirements
The Federal Reserve Board has adopted risk-based capital guidelines for banks
and bank holding companies. The minimum guideline for the ratio of total capital
to risk-weighted assets is 8%. At least half of the total capital is to be
comprised of common stock, retained earnings, minority interests in the equity
accounts of consolidated subsidiaries, noncumulative perpetual preferred stock
and a limited amount of qualifying cumulative perpetual preferred stock, less
goodwill and certain other intangibles ("Tier 1 Capital"). The remainder may
consist of other preferred stock, certain other instruments and a portion of the
loan loss allowance. At December 31, 2003, the Corporation's Tier 1 Capital and
Total Capital ratios were 20.38% and 21.74%, respectively.
In addition, the Federal Reserve Board has established minimum leverage ratio
guidelines for banks and bank holding companies. These guidelines provide for a
minimum ratio of Tier 1 Capital to average total assets of 3% for banks that
meet certain specified criteria, including having the highest regulatory rating.
All other banks and bank holding companies generally are required to maintain a
leverage ratio of at least 3% plus an additional cushion of 100 to 200 basis
points. The Corporation's leverage ratio at December 31, 2003 was 8.91%.
4
FDICIA
Pursuant to the Federal Deposit Insurance Corporation Improvement Act of 1991
("FDICIA"), each federal banking agency has promulgated regulations, specifying
the levels at which a financial institution would be considered "well
capitalized," "adequately capitalized," "undercapitalized," "significantly
undercapitalized," and "critically undercapitalized," and to take certain
mandatory and discretionary supervisory actions based on the capital level of
the institution. The regulations implementing these provisions of FDICIA provide
that a bank is defined to be "well capitalized" if it maintains a leverage ratio
of at least 5%, a risk-adjusted Tier 1 capital ratio of at least 6% and a
risk-adjusted total capital ratio of at least 10% and is not otherwise in a
"troubled condition" as specified by its appropriate federal regulatory agency.
A bank is defined to be "adequately capitalized" if it meets other minimum
capital requirements. In addition, a depository institution will be considered
"undercapitalized" if it fails to meet any minimum required measure,
"significantly undercapitalized" if it is significantly below such measure and
"critically undercapitalized" if it fails to maintain a level of tangible equity
equal to not less than 2% of total assets. A depository institution may be
deemed to be in a capitalization category that is lower than is indicated by its
actual capital position if it receives an unsatisfactory examination rating.
Insurance Funds Legislation
The Corporation's wholly-owned subsidiary, the Peapack-Gladstone Bank, is a
member of the Bank Insurance Fund ("BIF") of the FDIC. The FDIC also maintains
another insurance fund, the Savings Association Insurance Fund ("SAIF"), which
primarily covers savings and loan association deposits but also covers deposits
that are acquired by a BIF-insured institution from a savings and loan
association.
Restrictions on the Payment of Dividends
The holders of the Corporation's common stock are entitled to receive dividends,
when, as and if declared by the Board of Directors of the Corporation out of
funds legally available. The only statutory limitation is that such dividends
may not be paid when the Corporation is insolvent. Since the principal source of
income for the Corporation will be dividends on Bank common stock paid to the
Corporation by the Bank, the Corporation's ability to pay dividends to its
shareholders will depend on whether the Bank pays dividends to it. As a
practical matter, restrictions on the ability of the Bank to pay dividends act
as restrictions on the amount of funds available for the payment of dividends by
the Corporation. As a New Jersey chartered commercial bank, the Bank is subject
to the restrictions on the payment of dividends contained in the New Jersey
Banking Act of 1948, as amended (the "Banking Act"). Under the Banking Act, the
Bank may pay dividends only out of retained earnings, and out of surplus to the
extent that surplus exceeds 50% of stated capital. Under the Financial
Institutions Supervisory Act, the FDIC has the authority to prohibit a
state-chartered bank from engaging in conduct that, in the FDIC's opinion,
constitutes an unsafe or unsound banking practice. Under certain circumstances,
the FDIC could claim that the payment of a dividend or other distribution by the
Bank to the Corporation constitutes an unsafe or unsound practice. The
Corporation is also subject to FRB policies, which may, in certain
circumstances, limit its ability to pay dividends. The FRB policies require,
among other things, that a bank holding company maintain a minimum capital base.
The FRB would most likely seek to prohibit any dividend payment that would
reduce a holding company's capital below these minimum amounts.
Holding Company Supervision
The Corporation is a bank holding company within the meaning of the Holding
Company Act. As a bank holding company, the Corporation is supervised by the FRB
and is required to file reports with the FRB and provide such additional
information as the FRB may require.
The Holding Company Act prohibits the Corporation, with certain exceptions, from
acquiring direct or indirect ownership or control of more than five percent of
the voting shares of any company which is not a bank and from engaging in any
business other than that of banking, managing and controlling banks or
furnishing services to subsidiary banks, except that it may, upon application,
engage in, and may own shares of companies engaged in, certain businesses found
by the FRB to be so closely related to banking "as to be a proper incident
thereto." The Holding Company Act requires prior approval by the FRB of the
acquisition by the Corporation of more than five percent of the voting stock of
any additional bank. Satisfactory capital ratios, Community Reinvestment Act
ratings and anti-money laundering policies are generally prerequisites to
obtaining federal regulatory approval to make acquisitions. The policy of the
FRB provides that a bank holding company is expected to act as a source of
financial strength to its subsidiary bank and to commit resources to support the
subsidiary bank
5
in circumstances in which it might not do so absent that policy. Acquisitions
through the Bank require the approval of the FDIC and the New Jersey Department
of Banking and Insurance ("NJDOBI").
Recent Legislation
The Sarbanes-Oxley Act of 2002 ("Sarbanes-Oxley Act"), which became law on July
30, 2002, added new legal requirements for public companies affecting corporate
governance, accounting and corporate reporting.
The Sarbanes-Oxley Act provides for, among other things:
o a prohibition on personal loans made or arranged by the issuer to its
directors and executive officers (except for loans made by a bank subject
to Regulation O);
o independence requirements for audit committee members;
o independence requirements for company auditors;
o certification of financial statements and Forms 10-K and 10-Q reports by
the chief executive officer and the chief financial officer;
o the forfeiture of bonuses or other incentive-based compensation and
profits from the sale of an issuer's securities by directors and senior
officers in the twelve month period following initial publication of any
financial statements that later require restatement due to corporate
misconduct;
o disclosure of off-balance sheet transactions;
o two-business day filing requirements for insiders filing Form 4s;
o disclosure of a code of ethics for financial officers and filing a Form
8-K for a change or waiver of such code;
o "real time" filing of periodic reports;
o posting of certain SEC filings and other information on the company
website;
o the reporting of securities violations "up the ladder" by both in-house
and outside attorneys;
o restrictions on the use of non-GAAP financial measures;
o the formation of a public accounting oversight board; and
o various increased criminal penalties for violations of securities laws.
Each of the national stock exchanges, including the American Stock Exchange
(AMEX) where the Corporation's securities are listed, have implemented new
corporate governance listing standards, including rules strengthening director
independence requirements for boards, and requiring the adoption of charters for
the nominating and audit committees.
As part of the USA Patriot Act, signed into law on October 26, 2001, Congress
adopted the International Money Laundering Abatement and Financial
Anti-Terrorism Act of 2001 (the "Act"). The Act authorizes the Secretary of the
Treasury, in consultation with the heads of other government agencies, to adopt
special measures applicable to financial institutions such as banks, bank
holding companies, broker-dealers and insurance companies. Among its other
provisions, the Act requires each financial institution: (i) to establish an
anti-money laundering program; (ii) to establish due diligence policies,
procedures and controls that are reasonably designed to detect and report
instances of money laundering in United States private banking accounts and
correspondent accounts maintained for non-United States persons or their
representatives; and (iii) to avoid establishing, maintaining, administering, or
managing correspondent accounts in the United States for, or on behalf of, a
foreign shell bank that does not have a physical presence in any country. In
addition, the Act expands the circumstances under which funds in a bank account
may be forfeited and requires covered financial institutions to respond under
certain circumstances to requests for information from federal banking agencies
within 120 hours.
The Department of Treasury has issued regulations implementing the due diligence
requirements. These regulations require minimum standards to verify customer
identity and maintain accurate records, encourages cooperation among financial
institutions, federal banking agencies, and law enforcement authorities
regarding possible money laundering or terrorist activities, prohibits the
anonymous use of "concentration accounts," and requires all covered financial
institutions to have in place an anti-money laundering compliance program.
The Act also amends the Bank Holding Company Act and the Bank Merger Act to
require the federal banking agencies to consider the effectiveness of a
financial institution's anti-money laundering activities when reviewing an
application under these acts.
6
The Gramm-Leach-Bliley Financial Modernization Act of 1999 (the "Modernization
Act") became effective in early 2000. The Modernization Act:
o allows bank holding companies meeting management, capital and Community
Reinvestment Act Standards to engage in a substantially broader range of
nonbanking activities than previously permissible, including insurance
underwriting and making merchant banking investments in commercial and
financial companies; if a bank holding company elects to become a
financial holding company, it files a certification, effective in 30 days,
and thereafter may engage in certain financial activities without further
approvals;
o allows insurers and other financial service companies to acquire banks;
o removes various restrictions previously applied to bank holding company
ownership of securities firms and mutual fund advisory companies; and
o establishes the overall regulatory structure applicable to bank holding
companies that also engage in insurance and securities operations.
The Modernization Act also modified other financial laws, including laws related
to financial privacy and community reinvestment.
Additional proposals to change the laws and regulations governing the banking
and financial services industry are frequently introduced in Congress, in the
state legislatures and before the various bank regulatory agencies. The
likelihood and timing of any such changes and the impact such changes might have
on the Corporation cannot be determined at this time.
Item 2. DESCRIPTION OF PROPERTY
The Corporation owns six branches and leases 11 branches. The Corporation also
owns two properties adjacent to the Main Office in Peapack-Gladstone and a
future branch site in Tewksbury Township. The Corporation leases an
administrative and operations office building in Peapack-Gladstone, a data
center in Bedminster Township and a future branch location in the Town of
Morristown.
Item 3. LEGAL PROCEEDINGS
In the normal course of its business, lawsuits and claims may be brought against
the Corporation and its subsidiaries. There is no currently pending or
threatened litigation or proceedings against the Corporation or its
subsidiaries, which assert claims that if adversely decided, would have a
material adverse effect on the Corporation.
Item 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
None.
Item 4A. EXECUTIVE OFFICERS OF THE REGISTRANT
Name Age Executive Officer Since Office
- -------------------------------------------------------------------------------------------------------------
Frank A. Kissel 53 1989 Chairman and Chief Executive Officer
Craig S. Spengeman 48 1993 President, PGB Trust and Investments
Robert M. Rogers 45 1992 President and Chief Operating Officer
Arthur F. Birmingham 52 1996 Executive Vice President and Chief Financial Officer
Garrett P. Bromley 59 1997 Executive Vice President and Chief Credit Officer
7
PART II
Item 5. MARKET FOR REGISTRANT'S COMMON EQUITY AND RELATED STOCKHOLDER MATTERS
The Common Stock of Peapack-Gladstone Financial Corporation is traded on the
American Stock Exchange under the symbol of PGC. The following table sets forth,
for the periods indicated, the reported high and low sale prices on known trades
and cash dividends declared per share by the Corporation.
DIVIDEND
2003 HIGH LOW PER SHARE
------ ------ ---------
1st QUARTER $31.14 $22.77 $0.090
2nd QUARTER 32.99 18.18 0.090
3rd QUARTER 32.73 28.89 0.100
4th QUARTER 33.10 30.10 0.100
DIVIDEND
2002 HIGH LOW PER SHARE
------ ------ ---------
1st QUARTER $22.73 $16.48 $0.075
2nd QUARTER 28.64 22.50 0.075
3rd QUARTER 29.55 26.21 0.090
4th QUARTER 34.05 27.05 0.090
Future dividends payable by the Corporation will be determined by the Board of
Directors after consideration of earnings and financial condition of the
Corporation, need for capital and such other matters as the Board of Directors
deems appropriate. The payment of dividends is subject to certain restrictions,
see Part I, Item 1, "Description of Business - Restrictions on the Payment of
Dividends."
On December 31, 2003, the last reported sale price of the Common Stock was
$31.00. Also, on February 29, 2004, there were approximately 842 shareholders of
record.
Item 6. SELECTED CONSOLIDATED FINANCIAL DATA
The information set forth in the 2003 Annual Report under the heading "Selected
Consolidated Financial Data" is incorporated herein by reference.
Item 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS
The information set forth in the 2003 Annual Report under the heading
"Management's Discussion and Analysis" is incorporated herein by reference.
Item 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURE ABOUT MARKET RISK
The information set forth in the 2003 Annual Report under the heading "Market
Risk Sensitive Instruments" is incorporated herein by reference.
Item 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
The Consolidated Financial Statements set forth in the 2003 Annual Report,
together with the report thereon by KPMG LLP and the Notes to the Consolidated
Financial Statements, are incorporated herein by reference.
8
Item 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND
FINANCIAL DISCLOSURE
None.
Item 9A. CONTROLS AND PROCEDURES
The Corporation's Chief Executive Officer and Chief Financial Officer, with the
assistance of other members of the Corporation's management, have evaluated the
effectiveness of the Corporation's disclosure controls and procedures as of the
end of the period covered by this Annual Report on Form 10-K. Based on such
evaluation, the Corporation's Chief Executive Officer and Chief Financial
Officer have concluded that the Corporation's disclosure controls and procedures
are effective.
The Corporation's Chief Executive Officer and Chief Financial Officer have also
concluded that there have not been any changes in the Corporation's internal
control over financial reporting that has materially affected, or is reasonably
likely to materially affect, the Corporation's internal control over financial
reporting during the fourth quarter of 2003.
The Corporation's management, including the CEO and CFO, does not expect that
our disclosure controls and procedures or our internal controls will prevent all
error and all fraud. A control system, no matter how well conceived and
operated, provides reasonable, not absolute, assurance that the objectives of
the control system are met. The design of a control system reflects resource
constraints; the benefits of controls must be considered relative to their
costs. Because there are inherent limitations in all control systems, no
evaluation of controls can provide absolute assurance that all control issues
and instances of fraud, if any, within the Corporation have been or will be
detected. These inherent limitations include the realities that judgments in
decision-making can be faulty and that breakdowns occur because of simple error
or mistake. Controls can be circumvented by the individual acts of some persons,
by collusion of two or more people, or by management override of the controls.
The design of any system of controls is based in part upon certain assumptions
about the likelihood of future events. There can be no assurance that any design
will succeed in achieving its stated goals under all future conditions; over
time, control may become inadequate because of changes in conditions or
deterioration in the degree of compliance with the policies or procedures.
Because of the inherent limitations in a cost-effective control system,
misstatements due to error or fraud may occur and not be detected.
PART III
Item 10. DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT
The information set forth under the captions "Director Information," "Corporate
Governance" and "Section 16(a) Beneficial Ownership Reporting Compliance" in the
2004 Proxy Statement is incorporated herein by reference. Certain information on
Executive Officers of the registrant is included in Part I, Item 4A of this
report, which is also incorporated herein by reference.
Item 11. EXECUTIVE COMPENSATION
The information set forth under the caption "Executive Compensation" in the 2004
Proxy Statement is incorporated herein by reference.
9
Item 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
The following table shows information for all equity compensation plans:
NUMBER OF SECURITIES
REMAINING AVAILABLE
FOR FUTURE ISSUANCE
NUMBER OF SECURITIES UNDER EQUITY
TO BE ISSUED UPON WEIGHTED-AVERAGE COMPENSATION PLANS
EXERCISE OF EXERCISE PRICE OF (EXCLUDING SECURITIES
PLAN CATEGORY OUTSTANDING OPTIONS OUTSTANDING OPTIONS REFLECTED IN COLUMN (A)
- ---------------------------------------------------------------------------------------------
EQUITY
COMPENSATION
PLANS APPROVED
BY SECURITY
HOLDERS 424,279 $14.84 372,812
-----------------------------------------------------
EQUITY
COMPENSATION
PLANS NOT
APPROVED BY
SECURITY HOLDERS N/A N/A N/A
-----------------------------------------------------
TOTAL 424,279 $14.84 372,812
=====================================================
The information set forth under the captions "Beneficial Ownership of Common
Stock" and "Stock Ownership of Directors and Executive Officers" in the 2004
Proxy Statement is incorporated herein by reference.
Item 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
The information set forth under the caption "Certain Relationships and Related
Transactions" in the 2004 Proxy Statement is incorporated herein by reference.
PART IV
Item 14. PRINCIPAL ACCOUNTANT FEES AND SERVICES
The information set forth under the caption "Independent Public Auditors" in the
2004 Proxy Statement is incorporated herein by reference.
Item 15. EXHIBITS, FINANCIAL STATEMENTS, AND REPORTS ON FORM 8-K
(a) Financial Statements and Schedules:
Those portions of the 2003 Annual Report attached hereto as Exhibit 13
contain the financial statements incorporated herein by reference.
All financial statement schedules are omitted because they are either
inapplicable or not required, or because the required information is
included in the Consolidated Financial Statements or notes thereto
contained in the 2003 Annual Report.
10
(10) Exhibits
(3) Articles of Incorporation and By-Laws:
A. Restated Certificate of Incorporation as in effect on the date of
this filing is incorporated herein by reference to the Registrant's
Quarterly Report on Form 10-Q for the quarter ended March 31, 2003.
B. By-Laws of the Registrant as in effect on the date of this filing
are incorporated herein by reference to the Registrant's Quarterly
Report on Form 10-Q for the quarter ended September 30, 2003.
(10) Material Contracts:
A. "Change in Control Agreements" dated as of January 1, 1998 by and
among the Corporation, the Bank and Frank A. Kissel, Robert M.
Rogers, Craig C. Spengeman and Arthur F. Birmingham are incorporated
by reference to Registrant's Form 10-K Annual Report for the year
ended December 31, 1997.
B. Peapack-Gladstone Financial Corporation 1998 Stock Option Plan
and 1998 Stock Option Plan for Outside Directors are filed herewith.
C. "Change in Control Agreement" dated April 3, 1998 by and among
the Corporation, the Bank and Garrett P. Bromley is incorporated by
reference to Registrant's Form 10-K Annual Report for the year ended
December 31, 1998.
D. Agreement and Plan of Merger dated August 26, 1999 between
Peapack-Gladstone and Chatham Savings, FSB is incorporated herein by
reference to Peapack-Gladstone's Report on Form 8-K filed with the
Commission on September 7, 1999.
E. Peapack-Gladstone Financial Corporation 2002 Long-Term Stock
Incentive Plan and 2002 Stock Option Plan for Outside Directors are
filed herewith.
F. "Employment Agreements" dated as of May 13, 2002 by and among the
Corporation, the Bank and Frank A. Kissel, Craig C. Spengeman,
Robert M. Rogers and Arthur F. Birmingham are incorporated by
reference to Registrant's Quarterly Report Form 10-Q for the quarter
ended June 30, 2002.
G. "Employment Agreement dated as of January 1, 2003 by and among
the Corporation, the Bank and Garrett P. Bromley is incorporated by
reference to Registrant's Quarterly Report Form 10-Q for the quarter
ended March 31, 2003.
H. "Amended and Restated Change in Control Agreements" dated as of
December 11, 2003 by and among the Corporation, the Bank and Frank
A. Kissel, Robert M. Rogers, Craig C. Spengeman, Arthur F.
Birmingham and Garrett P. Bromley are filed herewith.
I. "Split Dollar Plan for Senior Management" dated as of September
7, 2001 for Frank A. Kissel, Robert M. Rogers, Craig C. Spengeman,
Arthur F. Birmingham and Garrett P. Bromley is filed herewith.
J. "Directors' Retirement Plan" dated as of March 31, 2001 is filed
herewith.
K. "Directors' Deferral Plan" dated as of March 31, 2001 is filed
herewith.
(13) Annual Report to Shareholders
(21) List of Subsidiaries:
(a) Subsidiaries of the Corporation:
Percentage of Voting
Jurisdiction Securities Owned by
Name of Incorporation the Parent
----------------------------------------------------------------
Peapack-Gladstone Bank New Jersey 100%
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(b) Subsidiaries of the Bank:
Name
----------------------------
Peapack-Gladstone Investment
Company, Inc. New Jersey 100%
Peapack-Gladstone Financial
Services, Inc. (Inactive) New Jersey 100%
(c) Subsidiaries of Peapack-Gladstone Investment Company, Inc.:
Name
---------------------------
Peapack-Gladstone Mortgage
Group, Inc. New Jersey 100%
(23) Consents of Experts:
Consent of KPMG LLP
(31.1) Certification of Frank A. Kissel, Chief Executive Officer of the
Corporation, pursuant to Securities Exchange Act Rule 13a-14(a).
(31.2) Certification of Arthur F. Birmingham, Chief Financial Officer of
the Corporation, pursuant to Securities Exchange Act Rule 13a-14(a).
(32) Certification Pursuant to 18 U.S.C. Section 1350, as adopted
pursuant to Section 906 of The Sarbanes-Oxley Act of 2002, signed by
Frank A. Kissel, Chief Executive Officer of the Corporation and
Arthur F. Birmingham, Chief Financial Officer of the Corporation.
b. Reports on Form 8-K
1. Current Report on Form 8-K dated November 6, 2003 (furnishing
third quarter earnings release for Peapack-Gladstone Financial
Corporation).
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the Securities
Exchange Act of 1934, the registrant has duly caused this report to be signed on
its behalf by the undersigned, thereunto duly authorized.
PEAPACK-GLADSTONE FINANCIAL CORPORATION
(Registrant)
By FRANK A. KISSEL
--------------------------------------
Frank A. Kissel, Chairman of the Board
Dated March 11, 2004
Pursuant to the requirements of the Securities Exchange Act of 1934, this
report has been signed by the following persons on behalf of the registrant and
in the capacities and on the dates indicated.
Signature Date
--------- ----
T. LEONARD HILL March 11, 2004
- --------------------------------------------------------
T. Leonard Hill, Director
FRANK A. KISSEL March 11, 2004
- --------------------------------------------------------
Frank A. Kissel, Chairman of the Board and CEO
12
ARTHUR F. BIRMINGHAM March 11, 2004
- --------------------------------------------------------
Arthur F. Birmingham, Executive Vice President and CFO
(Principal Financial and Accounting Officer)
ANTHONY J. CONSI II March 11, 2004
- --------------------------------------------------------
Anthony J. Consi II, Director
PAMELA HILL March 11, 2004
- --------------------------------------------------------
Pamela Hill, Director
JOHN D. KISSEL March 11, 2004
- --------------------------------------------------------
John D. Kissel, Director
JAMES R. LAMB March 11, 2004
- --------------------------------------------------------
James R. Lamb, Director
EDWARD A. MERTON March 11, 2004
- --------------------------------------------------------
Edward A. Merton, Director
F. DUFFIELD MEYERCORD March 11, 2004
- --------------------------------------------------------
F. Duffield Meyercord, Director
JOHN R. MULCAHY March 11, 2004
- --------------------------------------------------------
John R. Mulcahy, Director
ROBERT M. ROGERS March 11, 2004
- --------------------------------------------------------
Robert M. Rogers, President and COO
PHILIP W. SMITH III March 11, 2004
- --------------------------------------------------------
Philip W. Smith III, Director
CRAIG C. SPENGEMAN March 11, 2004
- --------------------------------------------------------
Craig C. Spengeman, President, PGB Trust and Investments
JACK D. STINE March 11, 2004
- --------------------------------------------------------
Jack D. Stine, Director
13
INDEPENDENT AUDITORS' CONSENT
The Board of Directors
Peapack-Gladstone Financial Corporation:
We consent to incorporation by reference in the Registration Statements No.
333-51187 and No. 333-53001 on Form S-8 of Peapack-Gladstone Financial
Corporation of our report dated February 6, 2004, relating to the consolidated
statements of condition of Peapack-Gladstone Financial Corporation and
subsidiary as of December 31, 2003 and 2002, and the related consolidated
statements of income, changes in shareholders' equity, and cash flows for each
of the years in the three-year period ended December 31, 2003, which report is
incorporated by reference in the December 31, 2003 Annual Report on Form 10-K of
Peapack-Gladstone Financial Corporation.
KPMG LLP
Short Hills, New Jersey
March 9, 2004
14