UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington D.C. 20549

 

SCHEDULE 14A

(Rule 14a-101)

INFORMATION REQUIRED IN PROXY STATEMENT

SCHEDULE 14A INFORMATION

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ss.240.14a-12CONNECTONE BANCORP, INC.

 

CENTER BANCORP, INC.

(Name of Registrant as Specified in Itsits Charter)

(Name of Person(s) Filing Proxy Statement, if other than the Registrant)

 

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CENTER BANCORP, INC.

Corporate Headquarters

2455 Morris301 Sylvan Avenue

Union,
Englewood Cliffs, New Jersey 0708307632

(908) 688-9500

NOTICE OF ANNUAL MEETING OF SHAREHOLDERSSTOCKHOLDERS
To Be Held on May 6, 2015

TO BE HELD MAY 24, 2012

To Our Shareholders:

TheNOTICE IS HEREBY GIVEN that the Annual Meeting (the “Annual Meeting”) of Shareholders of CenterConnectOne Bancorp, Inc. ("Center Bancorp" or(the “Company”), the "Company"holding company for ConnectOne Bank, (the “Bank”), will be held at Suburban Golf Club, 1730 Morris Avenue, Union, New Jersey145 Dean Dr., Tenafly, NJ 07670, on Thursday, May 24, 2012,6, 2015 at 9:008:15 a.m., for the purpose of considering and voting upon the following purposes:

matters, all of which are more completely set forth in the accompanying Proxy Statement:

1. To elect ten directorsThe election of twelve (12) Directors of the Company to serve for a one year term.

the terms described in the proxy statement or until their successors are elected and shall qualify;

2. To ratify the appointment of ParenteBeard LLCCrowe Horwath LLP as the Company'sCompany’s independent registered public accounting firmaccountants for 2012.

the fiscal year ending December 31, 2015; and

3. To vote, on an advisory basis, to approve the executive compensation of Center Bancorp's named executive officers, as described in this proxy statement.

4.     To vote, on an advisory basis, on how often Center Bancorp will conduct an advisory vote on executive compensation.

5.     To transact suchSuch other business as mayshall properly come before the Annual Meeting.

Only holders of record of Center Bancorpshares of the Company’s common stock (the “Common Stock”) at the close of business on April 2, 2012March 27, 2015 will be entitled to notice of and to vote at the Annual Meeting. Each share of Center Bancorp's common stock is entitled

You are requested to one vote.

Please complete,fill in, sign, date and return the accompanyingenclosed proxy inpromptly, regardless of whether you expect to attend the Annual Meeting. A postage-paid return envelope is enclosed postage paid envelope atfor your earliest convenience.

If you are present at the Annual Meeting, you may vote in person even if you have already returned your proxy.

Very truly yours,

FRANK SORRENTINO III
Chairman of the Board of Directors

Englewood Cliffs, New Jersey
April 15, 2015

IMPORTANT-PLEASE MAIL YOUR PROXY PROMPTLY

You are cordially invitedurged to attendsign and return the enclosed Proxy promptly in the envelope provided so that there may be sufficient representation at the Annual Meeting.

Important notice regarding the availability of proxy materialsProxy Materials for the 2012 annual meeting of shareholders: This Proxy Statement for the 2012 Annual Meeting of ShareholdersStockholders to be held on May 6, 2015. Our Proxy Statement and our 2011 Annual Report to Shareholders are also available online at:www.proxyvote.com.

CONNECTONE BANCORP, INC.http://www.rtcoproxy.com/cnbc
PROXY STATEMENT FOR
ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD ON MAY 6, 2015

 

By OrderThis Proxy Statement is being furnished to shareholders of the Board of Directors

/s/ Anthony C. Weagley
Anthony C. Weagley
Dated:  April 16, 2012President and CEO

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CENTER BANCORP, INC.

2455 Morris Avenue, Union, New Jersey 07083

PROXY STATEMENT

We are providing this proxy statement to youConnectOne Bancorp, Inc. (the “Company”) in connection with the solicitation by ourthe Board of Directors of proxies to be used at our annual meetingthe Annual Meeting of shareholdersstockholders to be held at Suburban Golf Club, 1730 Morris Avenue, Union, New Jersey145 Dean Dr., Tenafly, NJ 07670 at 9:008:15 a.m. on Thursday, May 24, 2012, and any adjournments of that meeting. We are first sending copies of this

About the Annual Meeting

Why have I received these materials?

The accompanying proxy, statement and the enclosed proxy card to our shareholdersbeing mailed on or about April 16, 2012. Unless we indicate otherwise, all references15, 2015 to "we", us" and "our" and other similar terms are references to Center Bancorp, Inc.

Only holders of recordthe Common Stock, is solicited by the Board of CenterDirectors of ConnectOne Bancorp, common stockInc. (referred to throughout this Proxy Statement as the “Company” or “we”), the holding company for ConnectOne Bank, in connection with our Annual Meeting of stockholders that will take place at 145 Dean Dr., Tenafly, NJ 07670 on May 6, 2015. You are cordially invited to attend the Annual Meeting and are requested to vote on the proposals described in this Proxy Statement.

Who is entitled to vote at the Annual Meeting?

Holders of Common Stock as of the close of business on April 2, 2012, a date which we refer to as  the record date, will receive notice of our annual meeting andMarch 27, 2015, will be entitled to vote at our annual meeting. Forthe Annual Meeting. On March 27, 2015, there were outstanding and entitled to vote 29,864,602 shares of Common Stock, each matter thatof which is presented to our shareholders at our annual meeting, you will be entitled to one vote forwith respect to each share of our common stock that you ownmatter to be voted on at the record date. OnAnnual Meeting.

How do I vote my shares at the record date, there were 16,332,327 shares of our common stock outstanding.

In a joint Schedule 13D amendment dated September 9, 2011, on behalf of Seidman and Associates, L.L.C., Seidman Investment Partnership, L.P., Seidman Investment Partnership II, L.P., Broad Park Investors, LLC, Chewy Gooey Cookies, LP, LSBK06-08, L.L.C., Lawrence Seidman, clients of Lawrence Seidman, CBPS, L.L.C., Dennis Pollack, Veteri Place Corporation and 2514 Multi-Strategy Fund, L.P., such persons stated that as of September 9, 2011, they beneficially own a total of 3,692,604 shares of our common stock, representing 22.7% of the shares outstanding as of August 9, 2011.  Seidman and Associates, L.L.C., Seidman Investment Partnership, L.P., Seidman Investment Partnership II, L.P., LSBK06-08, LLC and Lawrence Seidman have an address of 100 Misty Lane, Parsippany, New Jersey 07054.  Mr. Seidman also has an address of 19 Veteri Place, Wayne, New Jersey 07470.  Broad Park Investors, L.L.C. and Chewy Gooey Cookies, L.P. have an address of 80 Main Street, West Orange, New Jersey 07052.  Mr. Pollack has an address of 825 Third Avenue, New York, New York 10022.  CBPS, LLC has an address of One Rockefeller Plaza, New York, NY 10020, and 2514 Multi-Strategy Fund, L.P. has an address of 15310 Amberly Drive, Suite 220 Tampa, Florida 33647.

The following table provides information regarding the beneficial ownership of our common stock by Leon G. Cooperman and certain of his affiliates:

Name and Address of Beneficial Owner 

Amount and
Nature of
Beneficial
Ownership 

  Percent of
Class		 
Leon G. Cooperman       
2700 No. Military Trail, Suite 230       
Boca Raton, FL 33431      
Omega Equity Investors, L.P.      
88 Pine Street      
Wall Street Plaza—31st Fl,      
New York, NY 10005      
Michael S. Cooperman      
WRA Trust      
   845,000(1)    5.2%

(1)Pursuant to a Schedule 13G amendment filed with the Securities and Exchange Commission on February 2, 2012, the persons listed in the table above share voting and dispositive power with respect to the shares noted in the table.

Other than as set forth above, we are not aware of any other person or entity that owned of record or beneficially more than five percent of our outstanding common stock as of the record date.

Annual Meeting?

If you executeare a proxy card,“record” shareholder of Common Stock (that is, if you hold Common Stock in your own name as of March 27, 2015 in the Company’s stock records maintained by our transfer agent, Broadridge Financial Solutions, Inc.), you may vote by proxy or in person at the Annual Meeting. To vote by proxy, you may use one of the following methods:

•

Telephone voting, by dialing the toll-free number and following the instructions on your proxy card.

•

Internet voting, by accessing the Internet at the web address stated on the proxy card and following the instructions.

•

Mail, by completing and returning the proxy card in the enclosed envelope. The envelope requires no additional postage if mailed in the United States.

Can I change my vote after I return my proxy card?

Any stockholder of record has the power to revoke yourhis or her proxy at any time before it is exercised by either:voted. You may revoke your proxy before it is voted at the Annual Meeting by:

-3-

 

•

·submitting

voting again by telephone or the Internet, or completing a new proxy card with a later dated signed proxy beforedate—your latest vote will be counted;

•

filing with the Secretary of the Company written notice of such revocation; or

•

appearing at the annual meeting is conducted; or

·filing aand giving the Secretary written notice of revocation with our corporate Secretary either prioryour intention to the annual meeting or while the annual meeting isvote in progress but prior to the voting of your proxy: orperson.

·submitting a written ballot at the annual meeting.

All proxy cards that are properly executed and not revoked will be voted as specified in the proxy card. IfWhat constitutes a proxy is signed but no specification is given, the proxy will be voted in favorquorum for purposes of the Board's nominees for election toAnnual Meeting?

The presence at the Board,Annual Meeting in favorperson or by proxy of Proposals 2 and 3 and with respect to Proposal 4, for “every two years.”

Center Bancorp, which we refer to from time to time in this proxy statement as the "Company" or "Center," will bear the cost of soliciting proxies. In addition to our soliciting proxies by use of the mail, our officers and employees or officers or employees of our bank subsidiary may solicit proxies by telephone, telegraph or personal interview, with nominal expense to us. We will also pay the standard charges and expenses of brokerage houses or other nominees or fiduciaries for forwarding proxy soliciting material to the beneficial owners of shares. 

If holders of a majority of the voting power of all outstanding shares of our common stock areCommon Stock entitled to vote shall constitute a quorum

for the transaction of business. Proxies marked as abstaining (including proxies containing broker non-votes) on any matter to be acted upon by shareholders will be treated as present in person or by proxy,at the meeting for purposes of determining a quorum but will not be counted as votes cast on such matters.

Why is it important to vote my shares?

If we willdo not have a quorum which means thatpresent at the Annual Meeting, we will be ableneed to transact business atadjourn the annual meeting.  meeting to solicit additional proxies. This will cause additional expense and delay for the Company.

What vote is required to approve each item?

The election of directors will requireat the Annual Meeting requires the affirmative vote of a plurality of the common stockvotes cast at the Annual Meeting by shares represented in person or by proxy and entitled to vote atfor the annual meeting.  In other words, the ten persons who receive the highest numberelection of votes will be deemed elected to our Board.  Proposals 2 and 3 will be approved if a majoritydirectors. The ratification of the votes cast at the annual meeting by shareholders represented and entitled to vote at the annual meeting are "for" these proposals. With respect to Proposal 4, the option of one year, two years or three years that receives the highest number of votes cast will be the frequencyappointment of the vote on the compensation of our named executive officers that has been approved by the shareholders on an advisory basis. If any other matters are submitted to shareholders at the annual meeting, such matters will be deemed "approved" if they receiveindependent registered public accountants requires the affirmative vote of a majority of the votes cast at the annual meetingAnnual Meeting by shareholdersshares represented and entitled toin person or by proxy.

Summary of the Proposals

How does the Board recommend that I vote atmy shares?

Unless you give other instructions on your proxy card, the annual meeting.

For purposespersons named as proxies on the card will vote in accordance with the recommendations of determining the votes castBoard of Directors. The Board’s recommendation is set forth together with the description of each item in this Proxy Statement. In summary, the Board recommends a vote:

•

FOR the directors’ nominees to the Board of Directors;

•

FOR ratification of the appointment of Crowe Horwath LLP as the Company’s independent registered public accountants for the fiscal year ending December 31, 2015.

With respect to any matterother matters that properly come before the Annual Meeting, the proxy holders will vote as recommended by the Board of Directors or, if no recommendation is given, in their own discretion in the best interests of the Company. At the date this Proxy Statement went to press, the Board of Directors had no knowledge of any business other than that described in this proxy statement that would be presented for consideration at the Annual Meeting.

Who will bear the expense of soliciting proxies?

The Company will bear the cost of soliciting proxies. In addition to the solicitation by mail, proxies may be solicited personally or by telephone, facsimile or electronic transmission by our employees.

2

INTRODUCTION

On July 1, 2014, the Company announced the completion of a merger (the “Merger”), under which the Company merged with the former ConnectOne Bancorp, Inc. (hereinafter referred to as “Legacy ConnectOne”). Simultaneously, Union Center National Bank (“UCNB”), the Company’s then wholly owned subsidiary, merged with and into ConnectOne Bank, Legacy ConnectOne’s then wholly owned subsidiary, with ConnectOne Bank as the surviving institution. In connection with the closing of the Merger, the Company changed its name to ConnectOne Bancorp, Inc., and the Board of Directors and senior management of the Company were restructured, with Messrs. Alexander Bol, Lawrence B. Seidman and Anthony C. Weagley resigning from the Board, and Messrs. Frank Sorrentino, Frank W. Baier, Stephen T. Boswell, Frank Huttle III, Michael Kempner, and Joseph Parisi Jr. joining the Board.

3

PROPOSAL 1—ELECTION OF DIRECTORS

The Certificate and By-Laws of the Company provide that the number of Directors shall not be less than five (5) or more than twenty-five (25) and permit the exact number to be determined from time to time by the Board of Directors. For 2015, there are twelve (12) nominees for Director. There are no arrangements or understanding between any director, or nominee for directorship, pursuant to which such director or nominee was selected as a director or nominee.

The Board of Directors of the Company has nominated for election to the Board of Directors the persons named below, each of whom currently serves as a member of the Board. If elected, each will serve until the 2016 Annual Meeting of Stockholders, and until his replacement has been duly elected and qualified. The Board of Directors has no reason to believe that any of the nominees will be unavailable to serve if elected.

The following table sets forth the names, ages, principal occupations, and business experience for all nominees, as well as their prior service on the Board, if any. Unless otherwise indicated, principal occupations shown for each Director have extended for five or more years.

NOMINEES FOR ELECTION

Name and Position
with Company

Age

Principal Occupation for Past Five Years

Term of Office
Since(1)—Expires

Frank Sorrentino III,
Chairman of the Board and CEO

53

Chairman of the Board & Chief Executive Officer of the Company and the Bank; formerly Chairman of the Board and Chief Executive Officer of Legacy ConnectOne

2014–2015

Frank W. Baier
Director

49

Executive Vice President and Chief Financial Officer of Continental Grain Company, a diversified operating and investment company. Previously, from July 2011 through September 2012, Executive Vice President and Chief Financial Officer of Legecy ConnectOne and the Bank. Partner at Columbia Financial Partners LP, from May 2010 until June 2011.

2014–2015

Alexander A. Bol

67

Owner, Alexander A. Bol A.I.A. (architectural firm); Former Chairman of the Board of The Registrant and Union Center National Bank (2001–2014)

2015–2015

Stephen Boswell,
Director

61

President & Chief Executive Officer of Boswell Engineering

2014–2015

Frederick Fish

70

Managing Member, The Real Estate Equity Company, known as “Treeco” (partnership which develops, manages and has financial interests in 1.5 million square feet of retail shopping centers in NJ, NY, PA and MA); Director and Founding Member of American Spraytech (a contract filling and manufacturing company); General Partner of F.S. Fish Investment Company (private investment company)

2012–2015

Frank Huttle III,
Director

59

Executive Vice President and General Counsel Hudson Media Inc.; formerly Of Counsel to the firm of DeCotiis, Fitzpatrick & Cole, LLP

2014–2015

4

Name and Position
with Company

Age

Principal Occupation for Past Five Years

Term of Office
Since(1)—Expires

Michael Kempner,
Director

56

President & Chief Executive Officer, MWW Group, Inc.

2014–2015

Nicholas Minoia

59

Managing Partner of Diversified Properties and Diversified Realty Advisors, both full service real estate development companies specializing in the development, construction and management of multifamily communities.

2009–2015

Joseph Parisi, Jr.,
Director

53

Chairman of the Board and CEO of Otterstedt Insurance Agency; Mayor, Borough of Englewood Cliffs

2014–2015

Harold Schechter

70

Self Employed Financial Consultant (November 2010-Present); Chief Financial Officer, Global Design Concepts, Inc. (importer and distributor of accessories and handbags) (2005–November 2010)

2007–2015

William A. Thompson

57

General Manager, Uniselect USA (auto parts distributor) (2007–Present); Vice President of Thompson & Co. (auto parts distributor) (prior years)

1994–2015

Raymond J. Vanaria

56

Member, Malesardi, Quackenbush, Swift & Company, LLC (accounting firm)

2007–2015

(1)

Does not include prior service on the Board of Directors of Legacy ConnectOne or the Bank.

No Director of the Company, is also currently a director of a company having a class of securities registered under Section 12 of the Securities Exchange Act of 1934, as amended, or subject to the requirements of Section 15(d) of such Act or any company registered as an investment company under the Investment Bank Act of 1940. However, Frank Baier was a director of Doral Financial Corporation from 2007 until 2011, and Michael Kempner served as a director of Lighting Science Group Corporation from January 2010 until May 2012.

The Company encourages all directors to attend the Company’s annual meeting,meeting. Each then current member of the Company’s Board of Directors attended the Company’s 2014 Annual Meeting of Shareholders.

Required Vote

DIRECTORS WILL BE ELECTED BY A PLURALITY OF THE VOTES CAST AT THE ANNUAL MEETING WHETHER IN PERSON OR BY PROXY.

Recommendation

THE BOARD OF DIRECTORS RECOMMENDS THAT THE STOCKHOLDERS VOTE “FOR” THE NOMINEES SET FORTH ABOVE.

5

INFORMATION ABOUT THE BOARD OF DIRECTORS

Frank Sorrentino III, Chairman of the Board and Chief Executive Officer, 53:Mr. Sorrentino became Chairman and Chief Executive Officer of the Company commencing as of the closing of the Merger with Legacy ConnectOne on July 1, 2014. Prior to this, Mr. Sorrentino served as Chairman and Chief Executive Officer of Legacy ConnectOne and the Bank. Prior to becoming an officer of Legacy ConnectOne and the Bank, Mr. Sorrentino was a founder of the Bank and a builder and construction manager in Bergen County. Through his business contacts in our market, Mr. Sorrentino has been able to bring customers and investors to the Company, and his real estate experience in our market is of great value to the Board. In addition, as the Company’s senior executive officer, his insight on the Company’s operations is invaluable to the Board.

Stephen Boswell, Lead Independent Director, 61:Mr. Boswell was a founding organizer of the Bank. His firm, Boswell Engineering, Inc., for which he has served as President and Chief Executive Officer since 1990, is involved in many projects in our market. Through his business activities, Mr. Boswell has a strong sense of business conditions in our market that is invaluable to the Board.

Frank Baier, Director, 49:Mr. Baier currently serves as Executive Vice President and Chief Financial Officer of Continental Grain Company, a diversified operating and investment company. Mr. Baier has an extensive background in finance, including service as Executive Vice President and Chief Financial Officer of Independence Community Bank Corp. from June 2001 until September 2005, Chief Financial Officer and Chief Accounting Officer of Securities Industry and Financial Markets Association from June until September of 2008, Special Advisor to Washington Mutual from September 2008 until October 2008, Chief Financial Officer of Capital Access Network, Inc from February 2009 until February 2010, and a Partner at Columbia Financial Partners LP, from May 2010 until June 2011. Mr. Baier also served as Legacy ConnectOne’s Executive Vice President and Chief Financial Officer from July 2011 through September 2012. Mr. Baier’s extensive background and understanding of finance proves invaluable to the Board.

Alexander A. Bol, Director, 67:Mr. Bol founded Bol Architecture in 1974, and currently serves as a Principal of that firm. Mr. Bol is a member of the American Institute of Architects and the New Jersey Society of Architects and is certified by the National Council of Architectural Registration Boards. Mr. Bol is a New Jersey licensed Professional Planner and a registered Architect in the states of New Jersey, Massachusetts, New York, and Pennsylvania. The leadership Mr. Bol has provided to the Company and Union Center National Bank prior to the consummation of the Merger, together with his knowledge of the banking industry and his stature in the community led the board to conclude that Mr. Bol should serve as a director of the Company

Frederick Fish, Director, 70:Mr. Fish was appointed as a director of the Company and Union Center National Bank on March 30, 2012. Mr. Fish’s extensive knowledge of, and experience in, the real estate industry, his familiarity with complex financial transactions and his significant involvement with various charitable endeavors, led the Board to conclude that Mr. Fish should serve as a director.

Frank Huttle III, Director, 59:Mr. Huttle was a founding organizer of the Bank. He has over 30 years of experience in the insurance, mortgage banking and real estate industries formerly as a practicing attorney and partner at DeCotiis, Fitzpatrick and Cole, prior to taking his current position, and as a certified public accountant and Partner at Touche Ross & Co. Mr. Huttle has served as Executive Vice President and General Counsel to Hudson Media, Inc., a diversified magazine service and holding company since February, 2010. His experience as a transactional attorney and as a businessman in our market allows him to provide unique insight to the Board on a variety of matters, including current business conditions impacting our customers. Mr. Huttle also currently serves as the mayor of the Borough of Englewood, New Jersey.

Michael Kempner, Director, 56:Mr. Kempner was a founding organizer of the Bank. He has over 30 years of public relations and media experience and has served as President and Chief Executive Officer for MWW Group, Inc since 1985. His experience as the head of a locally based media company has proved invaluable to the Board.

6

Nicholas Minoia, Director, 59:Mr. Minoia’s experience as a principal of a full-service real estate group and his knowledge about the real estate market led the Board to conclude that Mr. Minoia should serve as a director.

Joseph Parisi, Jr., Director, 53:Mr. Parisi was a founding organizer of the Bank. Mr. Parisi has served as President and Chief Executive Officer of Otterstedt Insurance Agency since 1979, as well as Mayor for the Borough of Englewood Cliffs, New Jersey since November 2005. His experience both in the insurance industry and as the Mayor of a town in our market allow him to provide valuable insight to the Board on conditions affecting our customers.

Harold Schechter, Director, 70:Mr. Schechter’s financial acumen and experience as a chief financial officer of an import and distribution business, and his ability to understand complex financial matters, led the Board to conclude that Mr. Schechter should serve as a director.

William A. Thompson, Director, 57:Mr. Thompson’s management and business experience led the Board to conclude that Mr. Thompson should serve as a director.

Raymond J. Vanaria, Director, 56:Mr. Vanaria’s knowledge of financial and accounting matters, and his ability to understand and analyze complex financial issues, gained during his many years as an accountant, led the Board to conclude that Mr. Vanaria should serve as a director.

Diversity Statement

Although we have not adopted a formal policy on diversity, the Board considers diversity when selecting candidates for board service. When the Board determines there is a need to fill a director position, we begin to identify qualified individuals for consideration. We seek individuals that possess skill sets that a prospective director will be required to draw upon in order to contribute to the Board, including professional experience, education, and local knowledge. While education and skills are important factors, we also consider how candidates will contribute to the overall balance of the Board, so that we will only countbenefit from directors with different perspectives, varying view points and wide-ranging backgrounds and experiences. We view and define diversity in its broadest sense, which includes gender, ethnicity, education, experience and leadership qualities.

INFORMATION ABOUT THE BOARD OF DIRECTORS AND MANAGEMENT

Security Ownership of Management

The following table sets forth information as of March 27, 2015 regarding the number of equity securities beneficially owned by all Directors, executive officers described in the compensation table, and by all Directors and executive officers as a group. Beneficial ownership includes shares, if any, held in the name of the spouse, minor children or other relatives of the nominee living in such person’s home, as well as shares, if any, held in the name of another person under an arrangement whereby the Director or executive officer can vest title in himself at once or within sixty (60) days. Beneficially owned shares also include shares over which the named person has sole or shared voting or investment power, shares owned by corporations controlled by the named person, and shares owned by a partnership in which the named person is a partner.

7

 

 

 

 

 

Name

 

Common Stock

 

Percentage
of Common Stock
Beneficially Owned

Directors:

 

 

 

 

Frank Sorrentino III

 

 

 

689,104

(1)

 

 

 

 

2.29

%

 

Frank W. Baier

 

 

 

58,967

(2)

 

 

 

 

0.20

%

 

Alexander A. Bol

 

 

 

152,023

(3)

 

 

 

 

0.51

%

 

Stephen T. Boswell

 

 

 

289,539

(4)

 

 

 

 

0.97

%

 

Frederick Fish

 

 

 

26,751

(5)

 

 

 

 

0.09

%

 

Frank Huttle III

 

 

 

247,224

(6)

 

 

 

 

0.83

%

 

Michael Kempner

 

 

 

405,145

(7)

 

 

 

 

1.35

%

 

Nicholas Minoia

 

 

 

28,955

(8)

 

 

 

 

0.10

%

 

Joseph Parisi Jr.

 

 

 

255,664

(9)

 

 

 

 

0.85

%

 

Harold Schechter

 

 

 

27,401

(10)

 

 

 

 

0.09

%

 

William A. Thompson

 

 

 

105,256

(11)

 

 

 

 

0.35

%

 

Raymond J. Vanaria

 

 

 

100,395

(12)

 

 

 

 

0.34

%

 

Executive Officers Who Are Not Directors:

 

 

 

 

William S. Burns

 

 

 

46,768

(13)

 

 

 

 

0.16

%

 

Laura Criscione

 

 

 

83,972

(14)

 

 

 

 

0.28

%

 

Elizabeth Magennis

 

 

 

50,234

(15)

 

 

 

 

0.17

%

 

Anthony C. Weagley*

 

 

 

72,218

 

 

 

 

0.24

%

 

Francis R. Patryn*

 

 

 

16,960

 

 

 

 

0.06

%

 

Arthur M. Wein*

 

 

 

20,539

 

 

 

 

0.07

%

 

James W. Sorge*

 

 

 

4,521

 

 

 

 

0.02

%

 

 

 

 

 

 

As a Group (20 persons)

 

 

 

2,681,635

(16)

 

 

 

 

8.80

%

 

 

 

 

 

 

(1)

Includes (i) 12,500 shares held in the name of Citigroup Global Markets f/b/o Frank Sorrentino III, IRA, (ii) 53,241 shares held in street name at Citigroup Global Markets, (iii) 2,011 shares held in trust for Mr. Sorrentino’s children, (iv) 170,872 shares purchasable upon the exercise of stock options and (v) 31,847 shares of restricted stock subject to forfeiture.

(2)

Includes 1,352 shares of restricted stock subject to forfeiture.

(3)

Includes (i) 2,842 shares held by his spouse, and (ii) 24,311 shares purchasable upon the exercise of stock options

(4)

Includes (i) 55,602 shares purchasable upon the exercise of stock options and (ii) 1,352 shares of restricted stock subject to forfeiture.

(5)

Includes (i) 3,473 shares purchasable upon the exercise of stock options, and (ii) 1,352 shares of restricted stock subject to forfeiture

(6)

Includes (i) 14,487 shares held in the name of Citigroup Global Markets f/b/o Frank Huttle III, IRA, (ii) 3,375 shares held by Mr. Huttle and his wife in a joint tenancy, (iii) 2,500 shares held as trustee of the Francesca Huttle 2004 Family Trust, (iv) 2,500 shares held as trustee of the Alexandra Huttle 2004 Family Trust, (v) 5,031 shares held in the name of Mr. Huttle’s spouse, (vi) 2,500 shares held by an LLC in which spouse is a member, (vii) 66,845 shares purchasable upon the exercise of stock options and (viii) 1352 shares of restricted stock subject to forfeiture.

(7)

Includes (i) 77,309 shares purchasable upon the exercise of stock options and (ii) 1,352 shares of restricted stock subject to forfeiture.

(8)

Includes (i) 1,056 shares owned jointly with Mr. Minoia’s spouse, (ii) 13,892 shares purchasable upon the exercise of stock options and (iii) 1,352 shares of restricted stock subject to forfeiture

(9)

Includes (i) 3,333 shares held in the name of Hudson Real Estate Holding, LLC, of which Mr. Parisi is managing director and owner of one-third, (ii) 11,296 shares held in the name of Otterstedt Insurance Agency, of which Mr. Parisi is part owner, (iii) 2,323 shares held by Mr. Parisi as custodian for his children, (iv) 31,508 shares held at Bear Stearns Security Corp (v)

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71,574 shares purchasable upon the exercise of stock options and (vi) 1,352 shares of restricted stock subject to forfeiture.

(10)

Includes (i) 3,997 shares owned jointly with Mr. Schechter’s spouse, (ii) 17,365 shares purchasable upon the exercise of stock options and (iii) 1,352 shares of restricted stock subject to forfeiture.

(11)

Includes (i) 13,579 shares held by Mr. Thompson’s spouse and children, (ii) 28,653 shares purchasable upon the exercise of stock options and (iii) 1,352 shares of restricted stock subject to forfeiture.

(12)

Includes (i) 5,085 shares held by Mr. Vanaria’s spouse and children (ii) 20,838 shares purchasable upon the exercise of stock options and (iii) 1,352 shares of restricted stock subject to forfeiture.

(13)

Includes 10,863 shares of restricted stock subject to forfeiture.

(14)

Includes (i) 300 shares held for her daughter, (ii) 54,218 shares purchasable upon the exercise of stock options, and (iii) 3,678 shares of restricted stock subject to forfeiture.

(15)

Includes (i) 12,862 shares purchasable upon the exercise of stock options and (ii) 11,488 shares of restricted stock subject to forfeiture.

(16)

Includes 617,814 shares purchasable upon the exercise of stock options.

*

Messrs/ Weagley, Patryn, Wein, and Sorge ceased to be executive officers of the Company as of the closing of the Merger on July 1, 2014.

There are no shareholders other than those votesset forth above who are known to the Company to beneficially own 5% or more of the Common Stock of the Company.

Board of Directors; Independence; Committees

Meetings of the Board of Directors are held twelve (12) times annually and as needed. The Board of Directors held a total of thirteen (13) meetings in the year ended December 31, 2014. The Company’s policy is that all Directors make every effort to attend each meeting. For the year ended December 31, 2014, each of the Company’s Directors attended at least 75% of the aggregate of the total number of meetings of the Board of Directors and Board committees on which the respective Directors served.

A majority of the Board consists of individuals who are cast "for"“independent” under the Nasdaq listing standards. In making this determination with regard to Board member Michael Kempner, the Board considered the fact that the Company and the Bank have used Mr. Kempner’s firm, MWW Group, to provide advertising and public relations assistance and advice. The Board considered, among other factors, the fees paid to MWW Group as a percentage of the firm’s total revenue (less than 1%) and Mr. Kempner’s personal income and determined that the engagement of MWW Group did not interfere with Mr. Kempner’s exercise of independent judgment in carrying out the responsibilities of a director. In addition, the Board has considered the fact that several directors, including Messrs. Boswell, Huttle, Kempner and Parisi, each own a direct or "against" (or,indirect interest in a limited liability company which acts as a landlord for two of the Bank’s branches. See—CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS. The Board has concluded that based on each director’s respective interest in the rental payments compared to their overall net worth and cash, membership in such limited liability company does not interfere with respecttheir exercise of independent judgment in carrying out the responsibilities of a director. Mr. Sorrentino, who serves as the Chairman and Chief Executive Officer is not independent. Stockholders wishing to Proposal 4, every one year, every two years or every three years). communicate directly with the independent members of the Board of Directors may send correspondence to ConnectOne Bancorp, Inc., attn.: Stephen Boswell, Lead Independent Director, 301 Sylvan Avenue, Englewood Cliffs, New Jersey 07632.

Code of Business Conduct and Ethics

The Board of Directors has adopted a Code of Conduct governing our Chief Executive Officer and senior financial officers, as required by the Sarbanes-Oxley Act and SEC regulations, as well as the Board of Directors and other senior members of management. Our Code of Conduct governs

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such matters as conflicts of interest, use of corporate opportunity, confidentiality, compliance with law and the like. Our Code of Conduct is available on our website at www.cnob.com.

Committees

Committees of Our Board of Directors

Audit Committee.We will count abstentions and broker non-votes solelymaintain an Audit Committee in accordance with Section 3(a)(58)(A) of the Securities Exchange Act of 1934. The Audit Committee is responsible for the purpose of determining whether a quorum is present at the annual meeting.  Broker non-votes occur when brokers who hold their customers' shares in street name submit proxies for such shares on some matters, but not others.  Generally, this would occur when brokers have not received any instructions from their customers.  In these cases, the brokers, as the holders of record, are permitted to vote on "routine" matters, which typically include the ratificationselection of the independent registered public accounting firm but not on non-routine matters.

PROPOSAL 1

ELECTION OF DIRECTORS

Our By-Laws provide thatfor the annual audit and to establish, and oversee the adherence to, a system of internal controls. The Audit Committee reviews and accepts the reports of our Board will consist of not less than five nor more than twenty-five members.independent auditors and regulatory examiners. The exact number of directors is fixedAudit Committee arranges for an annual audit through its registered independent public accounting firm, evaluates and determined from time to time by resolutionimplements the recommendations of the fullauditors as well as interim audits performed by our outsourced internal auditors, receives all reports of examination by bank regulatory agencies, analyzes such regulatory reports, and reports to the Board or by resolutionthe results of its analysis of the shareholdersregulatory reports. The Audit Committee met six (6) times during 2014. The Board of Directors has adopted a written charter for the Audit Committee which is available on our website at any annual or special meeting.  Our Board has set the numberwww.cnob.com. The Audit Committee currently consists of directors at ten as of the annual meeting. Frederick S. Fish was appointed to our Board on March 30, 2012,Messrs. Vanaria (chair), Huttle, Baier and he will stand for election at the annual meeting. One of our existing directors, Alan H. Straus, has decided that he will not stand for re-election at the annual meeting. Accordingly,Schechter, all of whom are “independent” under the members of our current Board, other than Mr. Straus, will stand for re-election this year for a one year term.

SinceNasdaq listing standards and meet the adoptionindependence standards of the Sarbanes-Oxley Act in July 2002, there has been a growing public and regulatory focusfor service on the independence of directors. In response, Nasdaq adopted amendments to its definition of independence. Additional requirements relating to independence are imposedan audit committee, as required by the Sarbanes-Oxley Act with respect to members of the Audit Committee. As noted below, our Board has determined that the members of the Audit Committee satisfy all applicable definitions of independence. Our Board has also determined that the following members of our current Board (including all members of our Nominating and Compensation Committees) satisfy the Nasdaq definition of independence: Alexander A. Bol, Frederick S. Fish, James J. Kennedy, Howard Kent, Harold Schechter, Lawrence B. Seidman, Alan H. Straus, William A. Thompson and Raymond Vanaria.

Center does not contemplate that any nominee will be unable to serve as a director for any reason. Each of our Board's nominees has agreed to serve if elected. However, in the event that one or more of our Board's nominees should be unable to stand for election, discretionary authority is reserved to cast votes for the election of a substitute or substitutes selected by our Board of Directors and all proxies eligible to be voted for our Board's nominees will be voted for such other person or persons. Each of the nominees is also a member of the Board of Directors of our subsidiary, Union Center National Bank (the "Bank" or "UCNB").

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charter. The following table sets forth, for the ten nominees to our Board of Directors, their principal occupations for at least the past five years, their ages, the year in which they became a director of Center and UCNB, otherdirector positions held currently or at any time during the last five years,the number of shares of our common stock which they beneficially owned as of January 31, 2012 and their percentage of common stock ownership as of January 31, 2012:

Name Occupation Age  Director
Since		  Shares of
Common Sock
Held
Beneficially
Directly and
Indirectly		  Percent 
of
Shares
Outstanding		 
               
Alexander A. Bol Owner, Alexander A. Bol A.I.A. (architectural firm); Chairman of the Board of Center Bancorp and UCNB (2001-Present)  64   1994   132,646(a)  0.81 
                   
Anthony C.Weagley President and Chief Executive Officer of Center and UCNB from August 23, 2007 to Present;  Vice President and Treasurer of Center Bancorp and Sr. Vice President and Cashier of UCNB (prior periods) (Mr. Weagley continued to serve as Chief Financial Officer of Center until March 27, 2008 and as Chief Financial Officer of UCNB until February 2008)  50   Director of Center since September 30, 2010; Director of UCNB since December 17, 2007   62,985   0.39 
                   
Frederick S. Fish Managing Member, The Real Estate Equity Company, known as “Treeco” (partnership which develops, manages and has financial interests in 1.5 million square feet of retail shopping centers in NJ, NY, PA and MA; Director and Founding Member of American Spraytech (a contract filling and manufacturing company); General Partner of F.S. Fish Investment Company (private investment company)  67   March 30, 2012   0(b)  - 
                   
James J. Kennedy Managing Partner, KV1 Asset Management, LLC (hedge fund management company) (1998-Present); Vice-President, Chemical Bank Treasury & Capital Markets Group (swaps & options trading Manager) (1984-1990); Senior Managing Director, Fuji Capital Markets Corp (derivativesmarket-maker)(1990-1997)  56   2000   42,882   0.26 
                   
Howard Kent Member, Real Estate Equities Group, LLC (real estate investment and management business)  64   2008   312,174(c)  1.91 
                   
Nicholas Minoia Member, Diversified Properties, L.L.C. (full-service real estate group)  56   2009   15,501   0.09 
                   
Harold Schechter Self Employed Financial Consultant (November 2010 – Present) Chief Financial Officer, Global Design Concepts, Inc. (importer and distributor of accessories and handbags) (2005 - November 2010)  67   2007   17,134(d)  0.10 
                   
Lawrence B. Seidman Manager of various Investment funds; also a director of Stonegate Bank (January 2009-Present)  64   2007   3,770,642(e)  23.09 
                   
William A. Thompson General Manager, Uniselect USA (auto parts distributor) (2007-Present); Vice President of Thompson & Co. (auto parts distributor)  54   1994   90,510(f)  0.55 
                   
Raymond Vanaria Member, Malesardi, Quackenbush, Swift & Company, LLC (accounting firm); Vice-Chairman of the Board of Center Bancorp and UCNB (December 28, 2010-Present)  53   2007   77,884(g)  0.48 

(a)Includes 2,342 shares owned by Mr. Bol's spouse.

(b)While Mr. Fish did not own any shares of Center stock on January 31, 2012, in his Form 3 filed with the SEC on April 9, 2012, Mr. Fish indicates that he owns 10,500 shares of Center common stock.

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(c)Includes 234,254 shares owned jointly with Mr. Kent's spouse.
(d)Includes 3,767 shares owned jointly with Mr. Schechter’s spouse.
(e)See the description above regarding the 13D filing made by Mr.Seidman and others.   The shares reflected in the table for Mr. Seidman reflect all shares beneficially owned by the persons named in the 13D filing as of January 31, 2012.

(f)Includes 14,581 shares held by Mr. Thompson's spouse and children.
(g)Includes 3,685 shares held by Mr. Vanaria's spouse and children.

The shares set forth in the table above include the following number of shares subject to options exercisable by April 1, 2012: Mr. Bol, 16,456 shares; Mr. Weagley, 14,226 shares; Mr. Fish, 0 shares; Mr. Kennedy, 22,410 shares; Mr. Kent, 5,210 shares; Mr. Minoia, 2,605 shares; Mr. Schechter, 8,683 shares; Mr. Seidman, 8,683 shares; Mr. Thompson, 16,498 shares; and Mr. Vanaria, 8,683 shares.

As of January 31, 2012, Vincent N. Tozzi, who has served as our Vice President, Treasurer and Chief Financial Officer since March 28, 2011, beneficially owned 592 shares of our common stock (or 0.00%), including 0 shares subject to options exercisable by April 1, 2012; Arthur M. Wein, our Vice President and Chief Operating Officer, beneficially owned 9,292 shares of our common stock (or 0.06%), including 0 shares subject to options exercisable by April 1, 2012; Mark S. Cardone, our Vice President and Branch Administrator, beneficially owned 11,363 shares of our common stock (or 0.07%), including 6,130 shares subject to options exercisable by April 1, 2012; and John J. Lukens, our Vice President and Senior Credit Administrator, beneficially owned 256 shares of our common stock (or 0.00%), including 0 shares subject to options exercisable by April 1, 2012.

As of January 31, 2012, the total number of shares of our common stock directly and beneficially owned by all of our directors and executive officers as a group as of such date (15 persons) amounted to 4,558,134 shares or 28% of the common stock outstanding, including 109,584 shares subject to options exercisable by April 1, 2012.

There is no family relationship, by blood, marriage or adoption, between any of the foregoing directors and any other officer, director or employee of Center Bancorp or Union Center National Bank.

Our Board's Compensation Committee consists of Alexander A. Bol (Chairman), Lawrence B. Seidman, Harold Schechter and William A. Thompson. The responsibilities of the Compensation Committee are set forth in the Compensation Discussion and Analysis set forth below.

Our Board's Audit Committee consists of Raymond Vanaria (Chairman), James J. Kennedy, Howard Kent, Harold Schechter and William Thompson. The Audit Committee has been established by our Board of Directors for the purpose of overseeing the accounting and financial reporting processes of Center Bancorp and audits of our financial statements and has responsibility for monitoring our financial reporting systems, reviewing our financial statements, hiring and discharging our independent accountants and supervising the relationship between Center Bancorp and our independent accountants.

Our Board's Nominating Committee consists of Alexander A. Bol (Chairman), Alan H. Straus, James J. Kennedy, Howard Kent, Harold Schechter, Lawrence B. Seidman, William A. Thompson and Raymond Vanaria. For additional information regarding the Nominating Committee, see "Nominating Committee Matters".

Our Board's Executive Committee consists of Alexander A. Bol (Chairman), Alan H. Straus, James J. Kennedy, Howard Kent, Harold Schechter, Lawrence B. Seidman, William A. Thompson and Raymond Vanaria. The Executive Committee generally performs the functions of the full Board for determinations requiring the vote solely of independent directors.

During 2011, the Compensation Committee met six times, the Audit Committee met six times, the Nominating Committee met one time, the Executive Committee met one time and our Board of Directors met 12 times. All directors attended at least 75% of the Board and committee meetings that they were required to attend.

Board Leadership Structure and Role in Risk Oversight

The Company currently has, and historically has had, an independent Chairman of the Board, separate from the Chief Executive Officer.  The Board believes it is important to have an independent director in a Board leadership position at all times. Having an independent Chairman enables non-management directors to raise issues and concerns for Board consideration without immediately involving management. The Chairman also serves as a liaison between the Board and senior management.  The Company's Board has determined that the current structure, an independent Chairman, separate from the Chief Executive Officer, is the most appropriate structure at this time.

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The Audit Committee is responsible for overseeing risk management.  The full Board of Directors regularly engages in discussions about risk management and receives reports on this topic from executive management, other officers of the Company and the Chairman of the Audit Committee.  While the Board of Directors oversees risk management, management is responsible for the day-to-day risk management process.  The Company believes that its Board leadership structure supports this approach to risk management.

During 2011, the Company's Senior Risk Officer evaluated all of the compensation plans in which the Company's employees, including executive officers, participate, and reported to the Compensation Committee that none individually, or taken together, was reasonably likely to have a material adverse effect on the Company.  No component of compensation was considered to encourage undue risk.  The Compensation Committee accepted the Senior Risk Officer's report.  See "Compensation Committee Report."

Board Qualifications

The Board believes it is in the best interests of the Company and its stockholders for the Board to encompass a diverse range of talent, skill and expertise sufficient to provide sound and prudent guidance with respect to the Company's operations and interests. However, at all times a majority of the Board must be "independent directors" as defined from time to time by the listing requirements of the Nasdaq Global Select Market and any specific requirements established by the Board. Each director also is expected to:

- exhibit high standards of integrity, commitment and independence of thought and judgment;


- use his or her skills and experiences to provide independent oversight to the business of the Company;

- participate in a constructive and collegial manner;

- be willing to devote sufficient time to carrying out his or her duties and responsibilities effectively;

- devote the time and effort necessary to learn the business of the Company and the Board; and

- represent the long-term interests of all shareholders.

In addition, the Board of Directors has determined that the BoardRaymond Vanaria is an “audit committee financial expert”, as a whole must have the right diversity, mix of characteristics and skills for the optimal functioning of the Board in its oversight of the Company. The Board believes it should be comprised of persons with skills in areas such as:

- finance;

- sales and marketing;

- strategic planning;

- development of strategies for sustainability;

- human resources and diversity;

- safety;

- relevant industries, especially financial and real estate;

- leadership of large, complex organizations;

- legal;

- banking; and

- retail services.

In addition to the targeted skill areas, the Board looks for a strong record of achievement in key knowledge areas that it believes are critical for directors to add value to a Board, including:

- Strategy - knowledge of the Company's business model, the formulation of corporate strategies, knowledge of key competitors and local markets;

- Leadership - skills in coaching senior executives and the ability to assist the CEO in his development;

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- Organizational Skills - understanding of strategy implementation, management processes, group effectiveness and organizational design;

- Relationships - understanding how to interact with regulatory agencies, investors, financial analysts, and communities in which the Company operates;

- Functional - understanding of finance matters, financial statements and auditing procedures, technical expertise, legal issues, information technology and marketing; and

- Ethics - the ability to identify and raise key ethical issues concerning the activities of the Company and senior management as they affect the business community and society.

As part of its periodic self-assessment process, the Board annually determines the diversity of specific skills and characteristics necessary for the optimal functioning of the Board in its oversight of the Company over both the short- and longer-term. The Board has adopted a policy regarding the director selection process that requires the Nominating Committee to assess the skill areas currently represented on the Board and those skill areas represented by directors expected to retire or leave the Board in the near future against the target skill areas established annuallyterm is defined by the Board, as well as recommendations of directors regarding skills that could improve the overall quality and ability of the Board to carry out its function. The Committee then establishes the specific target skill areas or experiences that are to be the focus of a director search, if necessary. Specific qualities or experiences could include matters such as experience in banking, financial or technological expertise, experience in situations comparable to the Company's, leadership experience and relevant geographical experience. The effectiveness of the Board's diverse mix of skills and experiences is considered as part of each Board self-assessment.  See also "Nominating Committee Matters."SEC.

The Board considered the following attributes of its nominees in determining that each is qualified to serve as a director of Center Bancorp:

·The leadership Mr. Bol has provided to Center Bancorp and Union Center National Bank for many years, his knowledge of the banking industry and of the Bank, and his stature in the community led the Board to conclude that this nominee should serve as a director of Center Bancorp.

·Mr. Weagley was appointed as a director of Center Bancorp on September 30, 2010.  His specific knowledge and understanding of the Company, Union Center National Bank, the Bank's marketplace and the community, gained through his years of service as President and Chief Executive Officer, and, in prior years, as Chief Financial Officer, led the Board to conclude that this nominee should serve as a director of Center Bancorp.

·Mr. Fish was appointed as a director of Center Bancorp and Union Center National Bank on March 30, 2012.  Mr. Fish’s extensive knowledge of, and experience in, the real estate industry, his familiarity with complex financial transactions and his significant involvement with various charitable endeavors, led the Board to conclude that this nominee should serve as a director of Center Bancorp.

·Mr. Kennedy's business and financial experience and sophistication led the Board to conclude that this nominee should serve as a director of Center Bancorp.

·Mr. Kent's knowledge about, and experience in, the real estate investment and management business led the Board to conclude that this nominee should serve as a director of Center Bancorp.

·Mr. Minoia's experience as a principal of a full-service real estate group and his knowledge about the real estate market led the Board to conclude that this nominee should serve as a director of Center Bancorp.

·Mr. Schechter's financial acumen and experience as a chief financial officer of an import and distribution business, and his ability to understand complex financial matters, led the Board to conclude that this nominee should serve as a director of Center Bancorp.

·Mr. Seidman's financial background and experience as a manager of various investment funds over many years, and his knowledge of the banking industry, led the Board to conclude that this nominee should serve as a director of Center Bancorp.

·Mr. Thompson's management and business experience led the Board to conclude that this nominee should serve as a director of Center Bancorp.

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·Mr. Vanaria's knowledge of financial and accounting matters, and his ability to understand and analyze complex financial issues, gained during his many years as an accountant, led the Board to conclude that this nominee should serve as a director of Center Bancorp.

The biographies of the nominees are contained in the table of nominees set forth above under "Proposal 1 - Election of Directors".

EXECUTIVE COMPENSATION

Compensation Discussion and Analysis

General

As part of the SEC's executive compensation disclosure requirements, issuers must provide a "Compensation Discussion and Analysis" in which issuers explain the material elements of their compensation of executive officers by describing the following:

·the objectives of the issuer's compensation programs;

·the conduct that the compensation programs are designed to reward;

·the elements of the compensation program;

·the rationale for each of the elements of the compensation program;

·how the issuer determines the amount (and, where applicable, the formula) for each element of the compensation program; and

·how each element and the issuer's decisions regarding that element fit into the issuer's overall compensation objectives and affect decisions regarding other elements of the compensation program.

Our compensation philosophy is dictated by the Compensation Committee of our Board of Directors. The duties and responsibilities of the Compensation Committee, which consists entirely of independent directors of the Board, are to:

·provide guidance regarding the design of our employee benefit plans;

·oversee the investments of our 401(k) plan and qualified pension plan;

·establish the compensation of our chief executive officer;

·with input from our chief executive officer, establish or recommend to our Board the compensation of our other executive officers;

·monitor our overall compensation policies and employee benefit plans;

·monitor our incentive plans for appropriate performance measures consistent with our overall strategic objectives; and

·ensure that our incentive plans do not encourage unnecessary and excessive risk.

Our chief executive officer participates in determinations regarding the compensation and design of our benefit programs for all employees, but does not participate in setting his own compensation.

Our Compensation Objectives and the Focus of Our Compensation Rewards

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We believe that an appropriate compensation program should draw a balance between providing rewards to executive officers while at the same time effectively controlling compensation costs.  We reward executive officers in order to attract highly qualified individuals, to retain those individuals in a highly competitive marketplace for executive talent and to incentivize them to perform in a manner that maximizes our corporate performance. Accordingly, we have sought to structure our executive compensation with a focus on pay-for-performance.  We seek to offer executive compensation programs that align each individual's financial incentives with our strategic direction and corporate values.

We view executive compensation as having three key elements:

·a current cash compensation program consisting of salary and cash bonus incentives;

·long-term equity incentives reflected in grants of stock options and/or restricted stock; and

·other executive retirement benefits and perquisites.

These programs aim to provide our executives with an overall compensation package that is competitive with comparable financial institutions, and aligns individual performance with our long-term business objectives.

We annually review our mix of short term performance incentives versus longer term incentives, and incorporate in our compensation reviews the data from studies performed as to appropriate competitive levels of compensation and benefits.  We do not have set percentages of short term versus long term incentives.  Instead, we look to provide a reasonable balance of those incentives.

We also periodically "benchmark" our compensation programs to industry available databases and to a peer group.  The process has involved hiring independent compensation consulting firms to perform studies that employ the following processes:

·gathering data from industry specific global and regional compensation databases based upon company size for each executive position;

·determining an appropriate peer group of financial institutions based upon similar size and geography;

·developing data points for salary and total cash compensation comparisons and equity opportunities;

·averaging peer group and database statistics together to produce a relevant "market" at the data points for salary, total cash compensation and equity and comparing our positions to the "market" data;

·evaluating other compensation components, including executive benefits as compared to competitive standards; and

·comparing our compensation levels to the "market" and determining our relative positioning for competitiveness as to salary, total cash compensation and non-cash compensation.

Center's Compensation Committee has engaged Meyer Chatfield Compensation Advisors (MCCA), an independent compensation consulting firm strictly devoted to the community banking industry, as its outside consultant. During 2011, MCCA provided the Compensation Committee with a review of the compensation for the three most senior executives of the Company, including the CEO. The information provided was compiled from a number of national and regional salary surveys as well as comparable public peers. MCCA's executive compensation review assisted the Compensation Committee in its decision making related to executive compensation. The Committee evaluated the data presented, its relevance to Center and the recommendations of the consultant.

Compensation data for the following peer group was utilized by MCCA. The median assets for the peer group are $1,317,718, as compared to $1,207,154 for Center Bancorp.

·First United Corp·Abington Bancorp
·Severn Bancorp·ACNB Corp
·Shore Bancshares, Inc·Ameri Serv Financial, Inc.
·Ocean First Financial·Bryn Mawr Bank Corp
·Peapack Gladstone·Citizens & Northern Corp

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·Unity Bancorp·CNB Financial Corp
·Alliance Financial Corp·ESB Financial Corp
·Berkshire Bancorp·First Chester County Corp
·Canadaigua National Corp·Orrstown Financial Services
·Suffolk Bancorp·Parkvale Financial Corp
·Wilber Corp·Republic First Bancorp

MCCA assisted management with incentive arrangements for other non-NEO’s, specifically related to Residential Loan Origination to ensure compliance with Regulation Z, The Fair Labor Standards Act and the Dodd-Frank Act.. In addition, MCCA assisted the Committee in evaluating the inherent risk imbedded in the Company's incentive plans in compliance with TARP and other regulatory requirements.

MCAA indicated that Center's compensation of executives is below the median of the peer group, and recommended increases in salary and equity grants for Center's executives. The Compensation Committee determined to increase salaries for 2011, as reflected in the Summary Compensation Table, along with appropriate equity grants. The Compensation Committee's current goal is to continue to target the Market Median for salaries and gradually increase executive compensation over time in order to bring Center's executive compensation more in line with the median compensation of the peer group.

See "Other Compensation Committee Matters-Consultants" for additional information concerning the consulting services that were provided to us by MCCA in 2011.

Prior Participation in the Treasury's Capital Purchase Program

On January 12, 2009, the United States Treasury (the “Treasury”) purchased $10,000,000 of our non-convertible preferred stock (the “Preferred Shares”) under the Treasury’sTroubled Asset Relief Program (“TARP”) Capital Purchase Program.Participants in the Program were required to accept several compensation-related limitations associated with the Program. In August, 2011, we paid off all TARP Capital Purchase Program debt, and, accordingly, we are no longer subject to the compensation-related limitations imposed upon participants in the Program.

Specific Elements of Our Compensation Program

We have described below the specific elements of our compensation program for executive officers. The officers named in our Summary Compensation Table are referred to as the "Named Officers."

Salary. While consolidation continues within the banking industry, and recent experience continues to demonstrate that there remains a limited supply of qualified experienced executives, we believe that it is important that we retain a competitive salary structure in order to retain our existing qualified officers and maintain a base pay structure consistent with the structures utilized for the compensation of similarly situated executives in the industry and at similarly sized institutions. We maintain salary guidelines for our executive officers as part of a structured salary pay scale that is reviewed periodically based upon industry standards developed through studies by independent compensation consulting firms engaged by our Compensation Committee for that purpose. We believe that a key objective of our salary structure is to maintain reasonable "fixed" compensation costs by targeting base salaries at a competitive average, taking into effect performance as well as seniority. See "Our Compensation Objectives and the Focus of Our Compensation Rewards" for a description of the services provided by our compensation consultant for 2011.

None of the Named Officers was a party to an employment agreement with the Company or the Bank during 2011. We entered into a Non-Competition Agreement with Mr. Weagley, our CEO, dated December 2, 2010. On April 2, 2012, we entered into an Employment Agreement with Mr. Weagley, effective as of April 4, 2012. See "Agreements with Named Officers."

Short-TermIncentive Compensation. The Company currently has four active and distinct incentive plans, including one that was adopted in November of 2011 for certain residential mortgage lenders: The Achievement Incentive Plan (the “AIP”), Branch Manager Incentive Compensation Plan, Lender Incentive Plan and Mortgage Lender Incentive Plan. The AIP and Lender Incentive Plan are described below as they are the plans in which the Named Officers may participate.

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Achievement Incentive Plan

Participants are recommended annually by the CEO and approved by the Board of Directors and historically include the CEO, Senior Vice Presidents, Vice Presidents, Assistant Vice Presidents and Assistant Cashiers. The plan provides the opportunity to earn cash awards expressed as a percentage of salary and range from 30% for the CEO to 10% for Assistant Cashiers. Individuals are assigned specific objectives throughout the year which comprise the individuals’ "personal" goals. These personal goals typically represent at least 50% of the total available payout and can range up to 100% of the total available payout under the plan. The other component may be a "Bank" goal and accounts for up to 50% of the total payout, but is usually no more than 25% of the total available payout. For 2009, 2010 and until August of 2011, the CEO was not eligible to participant due to TARP prohibitions. For 2011, the following performance criteria were identified with the potential percentage of incentive that could be earned:

Capital GenerationUp to 25% of award
Borrowing CostsUp to 25% of award
OCC Exam RatingUp to 25% of award
Net IncomeUp to 25% of award
Individual GoalUp to 100% of award

Each participant's possible award included one or more of the above criteria with the maximum amount possible not to exceed 100% of the potential award.

See "Grant of Plan Based Awards" for a description of the amounts that could have been earned under this plan by the Named Officers. No awards were made for 2011 because the goals were not met. The Compensation Committee granted Mr. Weagley a cash bonus for 2011 because of his contributions to the Company during the year.

Lenders Incentive Compensation Program

Participants include individual lending executives from the Chief Lending Officer to each individual lender who is in good standing and has received satisfactory performance evaluations. This incentive plan provides quarterly cash payments linked to nine different quantifiable measures or production objectives. The plan is tied to bank wide and individual performance. Payments under the plan can approach $40,000 per individual. The plan was modified in 2009 to incorporate "mitigators" to reduce the risk profile of the plan and implement additional controls.

Deposits Accountsup to 10% of award
Fee Income Accountsup to 10% of award
Loans Meet Interest Targetup to 10% of award
Risk Ratingup to 12.5% of award
ROA Portfolio Assetsup to 12.5% of award
OCC Examinationup to 10% of award
Net Charge Offsup to 10% of award
Delinquencies on Loan Portfoliosup to 12.5% of award
Loan Review Didn't Downgrade Loanup to 12.5% of award

Long-Term Incentive Compensation.  We provide long-term incentives to the Named Officers through our stock incentive plans. During 2011, our Named Officers were eligible to participate in our 2009 Equity Incentive Plan. We refer to that plan as our "2009 Stock Plan". From time to time, the Compensation Committee has granted stock options and/or restricted stock awards to our executive officers.  Stock options have been granted at an exercise price equal to the then current market price of our common stock.  Options and restricted stock awards under the 2009 Stock Plan are granted on anad hoc basis taking into account financial performance and results. No options were granted to our senior executive officers in 2011. During 2011, restricted stock awards were granted to the CEO as part of his base compensation, the remainder of which was paid in cash.

In 2006, our Board established the Center Bank Open Market Share Purchase Incentive Plan, which we refer to as the "PIP".  We established the PIP in order to encourage ownership and retention of our common stock by our executive officers.  Under the PIP, any executive officer who applies up to 50% of his or her cash bonus to the purchase of our common stock in the open market will receive an additional cash amount to cover the Federal, State or local income taxes on the portion of the bonus used to make these purchases.  To be eligible for the bonus, the purchased shares must be held by the executive officer for at least 30 days. No open market purchases were made under the PIP for our Named Officers for 2011.

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Other Elements of Compensation for Executive Officers.  In order to attract and retain qualified executives, we provide executives with certain benefits and perquisites, consisting primarily of retirement benefits through our 401(k) Plan, executive life insurance and automobile allowances.  Details of the values of these benefits and perquisites may be found in the footnotes and narratives to the Summary Compensation Table below.

Other Agreements

For many years, we had employment agreements with Anthony C. Weagley. He had an employment agreement that terminated on December 31, 2009. On April 2, 2012, we entered into an Employment Agreement with Mr. Weagley, effective as of April 4, 2012. Our Compensation Committee has entered into no formal employment agreements with any of our other executives as of the end of 2011. We entered into a Non-Competition Agreement with Mr. Weagley, our CEO, dated December 2, 2010. See "Agreements with Named Officers."

Compliance with Sections 162(m), EESA and 409A of the Internal Revenue Code

Section 162(m) of the Internal Revenue Code denies a deduction to any publicly held corporation for compensation paid to certain "covered employees" in a taxable year to the extent that compensation exceeds $1,000,000 for a covered employee. Certain performance-based compensation that has been approved by our shareholders is not subject to this limitation. As a result, stock options granted under our 2009 Stock Plan are not subject to the limitations of Section 162(m). However, restricted stock awards under our 2009 Stock Plan generally will not be treated as performance-based compensation. Restricted stock award grants made to date by us have not been at levels that, together with other compensation, approached the $1,000,000 limit. Also, since we retain discretion over bonuses under the AIP and the Loan Incentive Plan, those bonuses also will not qualify for the exemption for performance-based compensation. The Compensation Committee intends to provide executive compensation in a manner that will be fully deductible for federal income tax purposes, so long as that objective is consistent with overall business and compensation objectives. However, we reserve the right to use our judgment to authorize compensation payments that do not comply with the exemptions in Section 162(m) when we believe that such payments are appropriate and in the best interests of our shareholders, after taking into consideration changing business conditions or the executive officer's performance.

While our Preferred Shares were outstanding, we were not permitted to take federal income tax deductions for compensation paid to the senior executive officers in excess of $500,000 per year, subject to certain exceptions.

It is also our intention to maintain our executive compensation arrangements in conformity with the requirements of Section 409A of the Internal Revenue Code, which imposes certain restrictions on deferred compensation arrangements.

Summary of Cash and Certain Other Compensation

The following table sets forth, for the years ended December 31, 2009, 2010 and 2011, a summary of the compensation earned by Anthony C. Weagley, our President and Chief Executive Officer, Richard Patryn, who served as our Chief Financial Officer from November 15, 2010 until March 28, 2011, when Vincent Tozzi was appointed as Vice President, Treasurer and Chief Financial Officer of Center, Vincent Tozzi, who has served as our Vice President, Treasurer and Chief Financial Officer since March 28, 2011, and our next three other most highly compensated executive officers who were employed by us as of December 31, 2011. We refer to the executive officers named in this table as the "Named Officers", we refer to Center Bancorp as "Center" and we refer to Union Center National Bank as "UCNB."

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SUMMARY COMPENSATION TABLE

 

Name and Principal
Position (a)

 

 

 

 

 

 

 

Year

(b)

  

 

 

 

 

 

 

Salary($)

(c)

  

 

 

 

 

 

 

Bonus

($) (d)

  

 

 

 

 

 

Stock

Awards

($) (e)

  

 

 

 

 

 

Option

Awards

($) (f)

  

 

 

 

 

Non-Equity

Incentive Plan

Compensation (g)

  Change in
Pension Value
and Nonqualified
Deferred
Compensation
Earnings ($) (h)		  

 

 

 

 

 

All Other

Compensation

($) (i)

  

 

 

 

 

 

 

Total

($) (j)

 
                            
Anthony C. Weagley,  2011   341,324   73,260   25,006   -   -   54,546   29,046   523,182 
President and Chief  2010   294,000   -   25,000   -   -   22,081   21,545   362,626 
Executive Officer of Center and  2009   250,000   -   -   -   -   19,973   17,802   287,775 
UCNB from August 23, 2007 to Present;  Vice President and Treasurer of Center and Sr. Vice President and Cashier of UCNB (prior periods) (Mr. Weagley continued to serve as Chief Financial Officer of Center until March 27, 2008 and as Chief Financial Officer of UCNB until February 2008)                                    
                                     
Vincent Tozzi  2011   157,500   -   -   -   -   -   3,210   160,710 
Vice President, Treasurer and Chief                                    
Financial Officer of Center, March 28, 2011 to Present                                    
          ��                          
Francis R. Patryn  2011   128,695   -   -   -   -   21,001   7,701   157,397 
Vice President, Chief Financial Officer  2010   111,910   -   -   -   -   11,368   5,778   129,056 
Officer and Comptroller of Center and Vice President and Chief Financial Officer and Comptroller of the Bank (November 2010 to March 28, 2011); Vice President and Comptroller of the Bank (October 2006 to March 28, 2011)  2009   109,180   3,275   -   -   -   16,194   6,249   134,898 
                                     
Arthur M. Wein  2011   175,329   -   -       -   -   15,183   190,512 
Vice President and Chief Operating  2010   152,840   -   -   -   -   -   5,192   158,032 
Officer of Center and Senior Vice President and Chief Operating Officer of the Bank (October 2009 to Present); Vice President and Business Development Officer of the Summit Region of the Bank (April 2009 to October 2009)  2009   67,483   -   -   -   -   -   415   67,898 
                                     
Mark S. Cardone  2011   158,233   -   -   -   -   17,492   13,475   189,200 
Vice President of Center and Senior  2010   141,159   -   -   -   -   7,076   13,230   161,465 
Vice President and Branch Administrator of the Bank (2001 to Present)  2009   122,216   -   -   -   -   11,523   12,831   146,571 
                                     
John J. Lukens  2011   151,985   -   -   -   -   7,579   10,243   169,807 
Vice President and Senior Credit  2010   135,585   -   -   -   -   4,410   9,240   149,235 
Administrator of Center and Senior Vice President and Senior Credit Administrator of the Bank (December 2009 to Present); Vice President of the Bank (September 2004 to December 2009)  2009   112,286   -   -   -   -   5,868   7,669   125,823 

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In the table above:

·when we refer to "stock awards," we are referring to the aggregate grant date fair value computed in accordance with FASB ASC Topic 718.  Mr. Weagley received a stock award in February 2011 as part of his base compensation for 2010.  He also received a stock award in February 2012 as part of his base compensation for 2011, which is not reflected in the table above (as it was granted in 2012).  Each of the stock awards was fully vested on the respective grant dates;

·when we refer to an "incentive plan", we are referring to a plan that provides compensation to incentivize performance over a specified period, whether such performance is measured by reference to our financial performance, our stock price or any other performance measure (including individual performance).  A "non-equity incentive plan" is an incentive plan in which benefits are not valued by reference to FAS 123R.  Our AIP and our Loan Incentive Plan are non-equity incentive plans;

·when we refer to changes in pension values in column "h" above, we are referring to the aggregate change in the present value of the Named Officer's accumulated benefit under the Union Center National Bank Pension Plan from the measurement date used for preparing our 2008 year-end financial statements to the measurement date used for preparing our 2009 year-end financial statements (in the case of our 2009 compensation), from the measurement date used for preparing our 2009 year-end financial statements to the measurement date used for preparing our 2010 year-end financial statements (in the case of our 2010 compensation) and from the measurement date used for preparing our 2010 year-end financial statements to the measurement date used for preparing our 2011 year-end financial statements (in the case of our 2011 compensation);

·the Named Officers did not receive any nonqualified deferred compensation earnings during 2009, 2010 or 2011; when we refer to "nonqualified deferred compensation earnings" in this table, we are referring to above-market or preferential earnings on compensation that is deferred on a basis that is not tax-qualified, such as earnings on a nonqualified defined contribution plan;

·"all other compensation" includes the following for 2011:

§for Mr. Weagley: $10,800 represents expense with respect to an automobile allowance; $17,303 represents matching payments that we made under our 401(k) plan; and $943 represents premiums for group term-life insurance and disability benefits;

§for Mr. Tozzi:  $2,500 represents expense with respect to an automobile allowance; and $710 represents premiums for group term-life insurance and disability benefits;

§for Mr. Patryn:  $6,757 represents matching payments that were made under our 401(k) plan; and $944 represents premiums for group term-life insurance and disability benefits;

§for Mr. Wein:  $3,000 represents expense with respect to an automobile allowance; $10,700 represents matching payments that we made under our 401(k) plan; and $1,483 represents premiums for group term-life insurance and disability benefits;

§for Mr. Cardone:  $4,800 represents expense with respect to an automobile allowance; $7,731 represents matching payments that we made under our 401(k) plan; and $944 represents premiums for group term-life insurance and disability benefits;

§for Mr. Lukens:  $9,119 represents matching payments that we made under our 401(k) plan; and $1,124 represents premiums for group term-life insurance and disability benefits;

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Grant of Plan Based Awards

During 2011, our Named Officers did not receive stock awards or stock options, except for Anthony C. Weagley, who received a stock award on February 2, 2011 as part of his base compensation. The amountsunder "Estimated Future Payouts Under Non-Equity Incentive Plan Awards" represents the threshold (minimum), target and maximum cash amounts that could have been earned by each Named Officer under the Company's AIP if specified performance targets had been attained. No amounts were paid under the Achievement Incentive Plan, or AIP, for 2011 because the goals were not met. For a description of the various performance targets, please see the description of the AIP under the Compensation Discussion and Analysis set forth above.

        All Other  All other     Grant 
        Stock  Option     Date Fair 
        Awards:  Awards:  Exercise  Value of 
     Estimated Future Payouts  Number of  Number of  or Base  Stock 
     Under Non-Equity Incentive  Shares of  Securities  Price of  and 
  Grant  Plan Awards  Stock or  Underlying  Stock  Option 
Name Date  Threshold  Target  Maximum  Units  Options  Awards  Awards 
(a) (b)  ($)(c)  ($)(d)  ($)(e)  (#)(i)  (#)(j)  ($/Sh)(k)  ($)(l) 
                         
Anthony C. Weagley  2/2/2011   0   109,890   153,846   2,780   -  $8.995  $25,006 
Vincent Tozzi  -   0   36,000   50,400   -   -   -   - 
Francis R. Patryn  -   0   25,739   36,034   -   -   -   - 
Arthur M. Wein  -   0   35,066   49,092   -   -   -   - 
Mark S. Cardone  -   0   31,646   44,305   -   -   -   - 
John J. Lukens  -   0   30,397   42,556   -   -   -   - 

Outstanding Equity Awards At Year End

The following table sets forth, for each of the Named Officers, information regarding outstanding stock options and stock awards at December 31, 2011.

Option Awards Stock Awards 
Name
(a)		 Number of
Securities
Underlying
Unexercised
Options
(#)
Exercisable
(b)		  Number of
Securities
Underlying
Unexercised
Options
(#)
Non-
Exercisable
(c)		  Option
Exercise
Price
($)
(e)		  Option
Expiration
Date
(f)		  Number of
Shares or Units
of Stock That
Have Not
Vested
(#)
(g)		  Market Value of
Shares or Units of
Stock That Have Not
Vested
($)
(h)		 
                   
Anthony C. Weagley  

4,631

   

-

  $ 

8.97

   

6/20/2012

   -   0 
   9,595    -  $ 10.64     10/19/2015         
Vincent Tozzi  -   -   -   -   -   0 
Francis R. Patryn  -   -   -   -   -   0 
Arthur M. Wein  -   -   -   -   -   0 
Mark S. Cardone  6,130   -  $10.64   10/19/2015   -   0 
John J. Lukens  -   -   -   -   -   0 

If applicable, market values are calculated in the table above by multiplying the closing market price of our common stock on the last trading day in 2011 - $9.77 - by the applicable number of shares of common stock underlying each Named Officer's stock awards.

-17-

Options Exercised and Stock Vested

The following table sets forth, for each of the Named Officers, information regarding stock options exercised during 2011 and stock awards vested during 2011. The phrase "value realized on exercise" represents the number of shares of common stock set forth in column (b) multiplied by the difference between the market price of our common stock on the date of exercise and the Named Officer's exercise price. Similarly, the phrase "value realized on vesting" represents the number of shares of common stock set forth in column (d) multiplied by the market price of our common stock on the date on which the Named Officer's stock award vested. As indicated in the table, none of the Named Officers exercised a stock option in 2011.

  Option Awards  Stock Awards 
Name
(a)		 Number of Shares
Acquired on
Exercise
(#)
(b)		  Value
Realized on
Exercise
($)
(c)		  Number of
Shares
Acquired on
Vesting (#)
(d)		  Value
Realized on
Vesting
($)
(e)		 
             
Anthony C. Weagley  -   -   2,780   25,006 
Vincent Tozzi  -   -   -   - 
Francis R. Patryn  -   -   -   - 
Arthur M. Wein  -   -   -   - 
Mark S. Cardone  -   -   -   - 
John J. Lukens  -   -   -   - 

Pension Benefits

The following table sets forth, for each of the Named Officers, information regarding the benefits payable under each of our plans that provides for payments or other benefits at, following, or in connection with such Named Officer's retirement. Those plans are summarized below the following table. The following table does not provide information regarding tax-qualified defined contribution plans or nonqualified defined contribution plans.

Name
(a)		 Plan
Name
(b)		 Number of
Years of
Credited Service
(#)
(c)		  Present Value of
Accumulated
Benefit
($)
(d)		  Payments
During Last
Fiscal Year
($)
(e)		 
            
Anthony C. Weagley Union Center National Bank Pension Plan Trust  24   296,825   0 
Vincent Tozzi -  -   -   - 
Francis R. Patryn Union Center National Bank Pension Plan Trust  10   176,664   0 
Arthur M. Wein -  -   -   - 
Mark S. Cardone Union Center National Bank Pension Plan Trust  7   92,767   0 
John J. Lukens Union Center National Bank Pension Plan Trust  4   66,312   0 

In the table above:

·we have determined the years of credited service based on the same pension plan measurement date that we used in preparing our audited financial statements for the year ended December 31, 2011; we refer to that date as the "Plan Measurement Date";

-18-

·when we use the phrase "present value of accumulated benefit", we are referring to the actuarial present value of the Named Officer's accumulated benefits under our pension plans, calculated as of the Plan Measurement Date;

·the present value of accumulated benefits shown in the table above has been determined using the assumptions set forth in our audited financial statements for the year ended December 31, 2010; and

·column (e) refers to the dollar amount of payments and benefits actually paid or otherwise provided to the Named Officer during 2011 under our pension plans.

The Union Center National Bank Pension Trust - which we refer to as the "Pension Plan" - is intended to be a tax-qualified defined benefit plan under Section 401(a) of the Internal Revenue Code.  The Pension Plan, which has been in effect since March 15, 1950, generally covers employees of Union Center National Bank and Center Bancorp who have attained age 21 and completed one year of service.  The normal retirement (age 65) pension payable under the Pension Plan is generally equal to 44% of a participant's highest average compensation over a 5-year period.  Compensation means a participant's W-2 wages, increased by certain reductions such as 401(k) contributions.  The normal retirement benefit is proportionately reduced if a participant has less than 25 years of service at age 65.  None of our Named Officers was eligible to retire with a normal retirement pension as of December 31, 2011.

A participant may retire before or after age 65. A participant will qualify for immediate commencement of an early retirement pension if he or she retires after attaining age 60 and completing at least six years of service. A participant who completes five years of service is entitled to a vested pension commencing at normal retirement age or after meeting the early retirement requirements. Early retirement and vested pension benefits are calculated in the same manner as a normal retirement pension, but are multiplied by a fraction the numerator of which is the participant's years of service and the denominator of which is the number of years of service the participant would have accumulated through normal retirement. Benefits payable prior to normal retirement are also subject to adjustment for actuarial equivalence, using age and interest factors specified by the Pension Plan. Based upon their ages and years of service, none of our Named Officers is currently eligible for an early retirement pension under the Pension Plan.

Pension Plan benefits are generally payable in the form of a life annuity or a joint and survivor annuity.  However, a participant may elect to receive his or her pension in a lump sum.  All forms of benefit are actuarially equivalent to a single life annuity form.

Stock Option Plans

We currently maintain the 2009 Equity Incentive Plan, under which our Compensation Committee may grant "incentive stock options" as defined under the Internal Revenue Code, non-qualified stock options, restricted stock awards and restricted stock unit awards to employees, including officers, and consultants. We previously maintained our 1999 Employee Stock Incentive Plan and our 1993 Employee Stock Option Plan, both of which have expired. No additional grants may be made under those plans. We adopted all of these plans in order to attract and retain qualified officers and employees and, with respect to the 2009 Equity Incentive Plan, consultants. Under the 1999 Employee Stock Incentive Plan, our Compensation Committee was able to grant incentive stock options, non-qualified stock options and restricted stock awards to our employees, including our officers. Under the 1993 Employee Stock Option Plan, our Compensation Committee was able to grant incentive stock options and non-qualified stock options to our officers and employees.

A total of 400,000 shares of common stock were authorized for issuance under the 2009 Equity Incentive Plan. A total of 394,417 shares were available for future grants as of January 1, 2012. As of December 31, 2011, we had 163 employees, all of whom are eligible to participate in the 2009 Equity Incentive Plan. Future grants under the 2009 Equity Incentive Plan have not yet been determined. No option will be exercisable more than ten years from the date of grant and no option or other award may be granted after March 26, 2019 under our 2009 Equity Incentive Plan.

We initially had 435,153 shares of our common stock authorized for issuance under the 1999 Employee Stock Incentive Plan (as adjusted for stock splits and stock dividends) and we initially had 633,194 shares authorized for issuance under the 1993 Employee Stock Option Plan (as adjusted for stock splits and stock dividends).

-19-

The following table provides information about our common stock that may be issued upon the exercise of options, warrants and rights under our 2009 Equity Incentive Plan, 1999 Employee Stock Incentive Plan, 1993 Employee Stock Option Plan, 1993 Outside Director Stock Option Plan and 2003 Non-Employee Director Stock Option Plan as of December 31, 2011. These plans were our only equity compensation plans in existence as of December 31, 2011. As of December 31, 2011, awards could only be granted under the 2009 Equity Incentive Plan and 2003 Non-Employee Director Stock Option Plan.

Plan Category Number of Securities to
be Issued Upon Exercise
of Outstanding Options,
Warrants and Rights		  Weighted Average
Exercise Price of
Outstanding Options,
Warrants and Rights		  Number of Securities
Remaining Available for
Future Issuance Under
Equity Compensation
Plans (Excluding
Securities Reflected in
Column (a))		 
Equity Compensation Plans Approved by Shareholders  171,378   7.67 - 15.73   825,420 
Equity Compensation Plans Not Approved by Shareholders  -   -   - 
Total  171,378   7.67 - 15.73   825,420 

Agreements with Named Officers

We have entered into a Non-Competition Agreement, dated as of December 2, 2010 (the "Non-Competition Agreement"), with Anthony C. Weagley, President and Chief Executive Officer and a director of Center. The Non-Competition Agreement, which has a two year term, provides that for the 12 month period immediately following Mr. Weagley's separation from service with Center, whether or not Center or the Bank has engaged Mr. Weagley as a consultant upon his separation of service, Mr. Weagley will not, directly or indirectly, as an agent, employee, owner, partner, stockholder or otherwise, compete with Center or the Bank or establish, engage in, or become interested in any business, trade or occupation that competes with Center or the Bank in the financial products or services industry in any county in any state of the U.S. in which Center's or the Bank's business is currently being conducted or is being conducted when Mr. Weagley's separation from service occurs. The Non-Competition Agreement also provides that Mr. Weagley will not solicit customers or employees during such period. In consideration for Mr. Weagley's covenant not to compete, upon his separation from service for any reason or due to retirement, Center will pay Mr. Weagley a lump sum payment equal to the aggregate of two times the annual rate of base salary then being paid to Mr. Weagley.  No amounts are payable in the event of Mr. Weagley's termination of employment as a result of death or disability.  The payments described in the Non-Competition Agreement are independent of and will be in addition to any payments required under any other plan or agreement that may be in effect between Center and Mr. Weagley at the time of separation.  Center will not be obligated to make the payments described above if Mr. Weagley voluntarily terminates his service with Center, other than for good reason, as defined in the Non-Competition Agreement. We had previously entered into an employment agreement with Mr. Weagley, which expired on December 31, 2009.

Had Mr. Weagley separated from service on December 31, 2011, he would have been entitled to receive a lump sum payment of $666,000 pursuant to the Non-Competition Agreement described above.

On April 2, 2012, Center, the Bank and Mr. Weagley entered into an employment agreement (the “Agreement”) effective as of April 4, 2012 (the “Effective Date”). Set forth below is a description of the material terms of the Agreement:

·The term of Mr. Weagley’s employment under the Agreement commences as of the Effective Date and, subject to earlier termination in accordance with the Agreement, shall continue for one year. Thereafter, the term of the Agreement will automatically renew each day after the Effective Date for one additional day so that the term of the Agreement will continuously be for one year unless any party thereto notifies the other parties of that party’s intent not to renew the Agreement.

·Mr. Weagley’s base salary shall not be less than $366,300 per annum during the term of the Agreement. In addition, Mr. Weagley’s salary will be reviewed annually by the board of directors for each of Center and the Bank (collectively, the “Boards”), and, as so increased, such increased salary will be Mr. Weagley’s base salary.

-20-

·During the term of the Agreement, Mr. Weagely will also receive an annual stock bonus award of $25,000 payable in shares of Center’s stock.

·Mr. Weagley will also be eligible to receive an annual incentive payment in an amount determined in the Boards’ sole discretion.

If Mr. Weagley’s employment is terminated without Cause (as defined in the Agreement), he will be entitled to, among other things:

·any fixed compensation earned and unpaid through the date of termination (the “Fixed Income Payment”);

·any earned and unpaid, unfixed income (such as a bonus or annual incentive payment), which will be calculated based on the average of such compensation for the prior three year period immediately preceding his termination, prorated for the portion of the year completed prior to his termination (the “Unfixed Income Payment”);

·three times the annual rate of his then current base salary (“Multiple Salary Payment”);

·three times the average of his bonuses paid for the three fiscal preceding years (excluding any fiscal year for which a bonus was not paid) (“Multiple Bonus Payment”);

·a monthly cash payment equal to the applicable per employee Healthcare benefits (as defined in the Agreement) for thirty-six months following termination (the “Healthcare Payment”); and

·the full vesting of all unvested stock options and restricted stock awards (the “Vested Equity”) (the foregoing payments, the “Termination Payments”).

If, following the consummation of a Change of Control (as defined in the Agreement), a Terminating Event (as defined in the Agreement) occurs and Mr. Weagley terminates his employment within one year of such Terminating Event, he will be entitled to the Termination Payments. In the event Mr. Weagley terminates his employment for Good Reason, he will also be entitled to the Termination Payments; provided, however, that the Multiple Salary Payment and the Multiple Bonus Payment shall be one time the applicable rate for calculating those payments.

In addition, the Agreement provides that, in the sole discretion of the parties, Mr. Weagley shall provide consulting services to Center and the Bank for a period of twenty four months following his separation from Center and the Bank. The consulting services will be for, among other things, any or all phases of Center’s and the Bank’s business in which Mr. Weagley has particular expertise and knowledge.

Compensation of Directors

The following table sets forth certain information regarding the compensation we paid to our directors who served as directors during 2011, other than Mr. Weagley. For information concerning Mr. Weagley, please see the “Summary Compensation Table”. Ms. Klein retired as a director on July 8, 2011. Mr. Straus was appointed as a director effective January 1, 2011 and is not standing for re-election at the annual meeting. As previously noted, Frederick S. Fish was appointed a director on March 30, 2012, and will stand for election at the annual meeting. None of our directors received compensation under any non-equity incentive plan during 2011.

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Director Compensation

Name 
(a)		 Fees
Earned or
Paid in
Cash
($)
(b)		  Stock
Awards
(SI)
(c)		  Option
Awards
($)
(d)		  Change in
Pension
Value and
Nonqualified
Deferred
Compensation
Earnings
($)
(f)		  All Other
Compensation
($)
(g)		  Total
($)
(h)		 
Alexander Bol  42,700   -   6,561   -   -   49,261 
James J. Kennedy  29,600   -   6,561   -   8,782   44,943 
Howard Kent  35,900   -   6,561   -   8,038   50,499 
Phyllis S. Klein  15,700   -   -   -   -   15,700 
Nicholas Minoia  31,100   -   6,561   -   -   37,661 
Harold Schechter  29,400   -   6,561   -   -   35,961 
Lawrence Seidman  35,600   -   6,561   -   8,951   51,112 
Alan H. Straus  22,400   -   -   -   -   22,400 
William Thompson  28,800   -   6,561   -   -   35,361 
Raymond Vanaria  41,200   -   6,561   -   12,723   60,484 

In the table above:

·when we refer to "Fees Earned or Paid in Cash", we are referring to all cash fees that we paid or were accrued in 2011, including annual retainer fees, committee and /or chairmanship fees and meeting fees;

·when we refer to "stock awards" or "option awards", we are referring to the aggregate grant date fair value computed in accordance with FASB ASC Topic 718;

·the grant date fair value for each of the option awards made to our directors during 2011 was $1.89 per share; an option covering 3,473 shares of common stock was granted to each non-employee director on March 1, 2011; the options vest in 25% increments, beginning one year after the grant date;

·the aggregate number of option awards outstanding for each director at December 31, 2011 were for Mr. Bol, 21,665 shares; Mr. Kennedy, 27,619 shares; Mr. Kent, 10,419 shares; Ms. Klein, 0 shares; Mr. Minoia, 6,946 shares; Mr. Schechter, 13,892 shares; Mr. Seidman, 13,892 shares; Mr. Straus, 0 shares; Mr. Thompson, 21,707 shares; and Mr. Vanaria, 13,892 shares;

·when we refer to "Change in Pension Value and Nonqualified Deferred Compensation Earnings", we are referring to the aggregate change in the present value of each director's accumulated benefit under all defined benefit and actuarial plans from the measurement date used for preparing our 2010 year-end financial statements to the measurement date used for preparing our 2011 year-end financial statements;

·the directors did not receive any nonqualified deferred compensation earnings during 2011; and

·the amounts in the “All Other Compensation” column for Messrs. Kennedy, Kent, Seidman and Vanaria consist of amounts we paid on behalf of these individuals for health insurance coverage.

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1993 Outside Director Stock Option Plan

Our 1993 Outside Director Stock Option Plan was adopted in order to attract and retain qualified directors. Pursuant to our 1993 Outside Director Stock Option Plan, each non-employee member of our Board received a one-time stock option covering 36,181 shares of our common stock (as adjusted for stock splits and stock dividends).  These options become exercisable in three installments, commencing one year after the date of grant, at a per share exercise price equal to the fair market value of one share of our common stock on the date of grant. Such options may not be exercised more than ten years after their date of grant.  No options were permitted to be granted under our 1993 Outside Director Stock Option Plan after November 17, 2003.

We initially had 569,876 shares of our common stock authorized for issuance under our 1993 Outside Director Stock Option Plan (as adjusted for stock splits and stock dividends).

2003 Non-Employee Director Stock Option Plan

Our 2003 Non-Employee Director Stock Option Plan was adopted in order to attract and retain qualified directors.  Our 2003 Non-Employee Director Stock Option Plan initially provided that on June 1 of each year, directors who served continuously on our Board during the twelve months immediately preceding such date and who were not employed by us or any of our subsidiaries during that twelve month period would be granted a stock option covering 3,000 shares of common stock.  These options vest over a four year period, subject to acceleration in certain instances.  For an eligible director who remained on our Board for the periods listed below, the operation of the 2003 Non-Employee Director Stock Option Plan as initially adopted would be as follows:

DateEffect
June 1, 2004An option covering  3,000 shares is granted; we will refer to this option as "Option A"; no shares are purchasable under Option A.
June 1, 2005An option covering 3,000 shares is granted; we will refer to this option as "Option B"); 750 shares are purchasable under Option A; and no shares are purchasable under Option B.
June 1, 2006An option covering  3,000 shares is granted; we will refer to this option as "Option C"; 1,500 shares are purchasable under Option A; 750 shares are purchasable under Option B; and no shares are purchasable under Option C.
June 1, 2007An option covering  3,000 shares is granted;  we will refer to this option as "Option  D"; 2,250 shares are purchasable under Option A; 1,500 shares are purchasable under Option B; 750 shares are purchasable under Option C; and no shares are  purchasable under Option D.

During 2004, 2005, 2006 and 2007, after giving effect to stock splits and stock dividends, we granted options covering 3,308, 3,473, 3,473 and 3,473 shares, respectively, to each non-employee member of our Board pursuant to our 2003 Non-Employee Director Stock Option Plan. 

On February 28, 2008, our Board adopted amendments to the 2003 Non-Employee Director Stock Option Plan providing that options covering 3,473 shares would be granted on March 1 of each year, commencing March 1, 2008, to directors who served continuously on our Board during the six months immediately preceding such date and who were not employed by us or any of our subsidiaries during that six month period. No changes were made to the vesting provisions of the 2003 Non-Employee Director Stock Option Plan.

All of the options granted in 2006 and 2007 are fully exercisable, three quarters of the options granted in 2008, one half of the options granted in 2009, one half of the options granted in 2010 and one quarter of the options granted in 2011 are exercisable on or before April 1, 2012. We initially had 551,250 shares of our common stock authorized for issuance under our 2003 Non-Employee Director Stock Option Plan (as adjusted for stock splits and stock dividends) and 438,986 shares remained available for grant as of January 1, 2012. 

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During 2011, there were no fees paid to any director of Center Bancorp for any meeting of the Center Bancorp Board of Directors. The chairman of the Audit Committee and the chairman of the Compensation Committee received $600 for each committee meeting attended.  Members of the Audit Committee and the Compensation Committee received $400 for each committee meeting attended. Alexander A. Bol, Chairman of the Board of Union Center National Bank, received a $16,000 annual retainer and $1,000 for each meeting of Union Center National Bank's Board that he attended.  Raymond Vanaria, Vice-Chairman of the Board of Union Center National Bank, received a $12,000 retainer and $900 for each meeting of Union Center National Bank’s Board that he attended. All other directors of Union Center National Bank who are not officers of the Bank received an $8,000 annual retainer and $900 for each meeting of the Union Center National Bank Board that they attended.

Compensation Committee Interlocks and Insider Participation

The Compensation Committee consists of Alexander A. Bol, Lawrence B. Seidman, Harold Schechter (since July 28, 2011) and William A. Thompson. Of the persons named, only Mr. Bol has served as an officer and/or employee of Center Bancorp or Union Center National Bank.  Phyllis S. Klein, who served as a director until her resignation on July 8, 2011, also served on the Compensation Committee during 2011.  Mr. Weagley participates in determinations regarding compensation of all employees other than himself.

Certain of our directors and officers and their associates have had loan transactions with Union Center National Bank in the ordinary course of business during 2011. All such transactions with these directors and officers and their associates were made in the ordinary course of business on substantially the same terms, including interest rates and collateral, as those prevailing at the time of such transactions for comparable persons not related to us or Union Center National Bank and did not involve more than a normal risk of collectability or present other unfavorable features.

Policies and Procedures Concerning Related Party Transactions

Report

The Audit Committee meets periodically to consider the adequacy of the BoardCompany’s financial controls and the objectivity of Directors has adopted written procedures governing related party transactions.  The procedures include the following:

·all related party transactions that have been previously approved by the full Board of Directors will not be included in the transactions that are approved by the Audit Committee;

·any single related party transaction up to $10,000 is automatically deemed to be pre-approved by the Audit Committee;

·the Chairman of the Audit Committee is authorized to approve, prior to payment, related party transactions over $10,000 but not exceeding $50,000, and may override any previously approved transaction; and

·related party transactions over $50,000 must be approved, prior to payment, by a majority of the members of the Audit Committee.

For additional procedures, see the Audit Committee Charter, which was attached to the 2010 proxy statement as Annex B.its financial reporting. The Audit Committee reviews related party transactions at least on a monthly basis.  By "related party transaction," we mean a transaction betweenmeets with the Company or anyCompany’s independent auditors and the Company’s internal auditors, all of its subsidiaries, onwhom have unrestricted access to the one hand, and an executive officer, director or immediate family member of an executive officer or a director, onAudit Committee.

In connection with this year’s financial statements, the other hand.

Compensation Committee Report

The CompensationAudit Committee has reviewed and discussed the information provided underCompany’s audited financial statements with the caption "Compensation DiscussionCompany’s officers and Analysis" set forth above.  Crowe Horwath LLP, our independent auditors. We have discussed with Crowe Horwath LLP, the matters required to be discussed by Statement on Auditing Standards No. 61, (“Communication with Audit Committees”). We also have received the written disclosures and letters from Crowe Horwath LLP required by Independence Standards Board Standard No. 1 (“Independence Discussions with Audit Committees”), and have discussed with representatives of Crowe Horwath LLP their independence.

Based on that reviewthese reviews and those discussions, the CompensationAudit Committee recommended to ourthe Board of Directors that such "Compensation Discussion and Analysis"the audited financial statements be included in this proxy statement.

In addition, in accordance with U.S. Treasury regulations applicable to participants in the TARP Capital Purchase Program, in whichCompany’s Annual Report on Form 10-K for the Company participated in 2011, the Compensation Committee of Center Bancorp's Board of Directors certifies that:

(1)It has reviewed with senior risk officers the senior executive officer (SEO) compensation plans and has made all reasonable efforts to ensure that these plans do not encourage SEOs to take unnecessary and excessive risks that threaten the value of Center Bancorp.

(2)It has reviewed with senior risk officers the employee compensation plans and has made all reasonable efforts to limit any unnecessary risks that the plans pose to Center Bancorp.

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(3)It has reviewed the employee compensation plans to eliminate any features of these plans that would encourage manipulation of reported earnings of Center Bancorp to enhance the compensation of any employee.

As required under Treasury's initial interim final rule related to the TARP executive compensation limitations issued in October 2008, the Company's Senior Risk Officer in May 2009 reviewedfiscal year 2014 for filing with the Committee, at the direction of the Company's primary federal regulator, the Company's executive incentive compensation plans to ensure that the Company's executive officers were not encouraged to take unnecessaryU.S. Securities and excessive risks that could threaten the value of the Company. As required by the June 2009 interim final rule, the Committee engaged in December 2009, with the assistance of the Company's Senior Risk Officer, in a broader review that included all of the Company's incentive compensation plans for all employees. This latter review included discussion, evaluation and review of the plans applicable to the Company's senior executive officers and other eligible officers to ensure that such plans do not encourage such officers to take unnecessary and excessive risks that threaten the value of the Company; discussion, evaluation and review of all employee plans in light of the risks posed to the Company by such plans and how to limit such risks (including ensuring the plans do not encourage behavior focused on short-term results rather than long-term value creation); and discussion, evaluation and review of all employee plans to ensure the plans do not encourage the manipulation of reported earnings to enhance the compensation of any of the Company's employees.Exchange Commission.

In meeting with the Company's Senior Risk Officer and other members of executive management, the Committee identified the Company's senior executive officer compensation plans. For 2011, these plans were the Achievement Incentive Plan ("AIP") and the Loan Incentive Plan. The Committee also reviewed the Company's other non-senior executive officer compensation plan, the 2011 Branch Management Incentive Compensation Program and the Mortgage Lender Incentive Plan. See the Compensation Discussion and Analysis for the services provided by our consultant in 2011.

The Committee's review of the Company's AIP concluded with a determination by the Committee that the plan did not encourage unnecessary and excessive risks that threatened the value of the Company and did not encourage manipulation of the Company's reported earnings to enhance the compensation of any of the Company's employees. The AIP contained a soundness threshold that conditions any incentive payments to any plan participants on attaining very specific quantifiable goals verified by the CEO and Board of Directors. The review concluded that the exclusion of the CEO, due to TARP limitations, who must approve all awards under the Plan, provided a significant restraint to actions resulting in inappropriately higher risk to the Company. Furthermore, the plan limits the maximum amount of payout and participant inclusion in the Plan is determined annually and inclusion in one year does not guarantee inclusion in subsequent years, thus further limiting the risk to the Company. In connection with the review in December 2009, it was noted that the Company's chief executive officer was subject to the cash bonus prohibition for the TARP period, and thus not eligible to participate in the AIP. The December 2009 review recommended consideration of certain changes, including a minimum Company profitability requirement. The review also concluded that consideration be given to adopting a pooled incentive derived from the financial statements, which would allow for better peer comparisons. These recommendations will be included in any future plans and incorporated in existing plans as appropriate.  The Committee, with the assistance of the Senior Risk Officer, conducted similar reviews in June of 2010, December of 2010, June of 2011 and a final review in December 2011 as required by TARP. These reviews also concluded that no unnecessary risks were present and that the plans had sufficient controls in place to manage acceptable risk.  In light of the Company's performance, the Compensation Committee and our Board of Director's determined that no AIP awards for 2009, 2010 or 2011 would be granted to any of the SEOs participating in the AIP due to overall Company performance falling short of budget expectations.

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The review of the Company's Loan Incentive Plan, which was modified during 2009 to incorporate additional risk mitigators, concluded with a determination by the Committee that the plan did not encourage unnecessary or excessive risks that threatened the value of the Company or that encouraged the manipulation of the Company's earnings to enhance the compensation of any of the Company's loan officers. Similar reviews in June of 2010, December of 2010, June of 2011 and a final review in December 2011as required under TARP determined the plan did not encourage unnecessary or excessive risks that threatened the value of the Company or that encouraged the manipulation of the Company's earnings to enhance the compensation of any of the Company's loan officers. The Company requires participants to be in good standing and prohibits awards based on transactions approved solely under the officer's authority.  Additionally, the plan requires that awards will be eligible only for loans that meet safety and soundness underwriting standards. Incentive awards earned under the plan may be adjusted based on current and historical credit quality results as measured by actual delinquency levels. Unacceptable performance in subsequent periods allows the Company to recover ("clawback") previously paid awards. The Company believes that there are adequate controls and clawback provisions embedded within the plan to mitigate the risk associated with the plan. Officers that participate in the Loan Incentive Plan do not participate in the AIP. The December 2009 and subsequent reviews recommended incorporating a deferral feature to allow for the evaluation of the time horizon associated with realizing the impact of loans generated in the current period.To date, the Company has not modified the plans to incorporate a deferral feature, preferring to limit the amount of awards available under the plan until such time as performance justifies meaningful awards. During 2011, the Company adopted the Residential Mortgage Lenders Incentive Plan with the assistance of the compensation consultant. Special attention was provided to ensure the plan complied with the recently enacted Dodd-Frank Act (effective April, 2012), revised provisions of Regulation Z (effective April, 2011) related to consumer safety and loan originations and the Fair Labor Standards Act concerning minimum wage requirements for exempt and non-exempt employees. The plan awards incentives for loan production without regard to the specific type of loan or size of the loan. Credit quality and delinquent payments are also components of the plan intended to minimize risk to the customer and the Company.Participants in the Residential Mortgage Lenders Incentive Plan do not participate in any other incentive plan offered by the Company. The December, 2011 review of the Company’s incentive plans determined the plan did not encourage unnecessary risks that threatened the value of the Company or that encouraged the participants to manipulate documentation to enhance their awards.

After its review of these incentive compensation arrangements, the Committee was able to conclude that none of these arrangements encourage manipulation of the Company's reported earnings to enhance the compensation of any of the Company's employees.

Alexander A. Bol

Raymond Vanaria, Chair
Frank Huttle, III
Frank W. Baier,
Harold Schechter

Lawrence B. SeidmanCompensation Committee.

William A. Thompson

Other Compensation Committee Matters

CharterCharter..  OurThe Board of Directors has defined the duties of its Compensation Committee in a charter. A copy of the current Compensation Committee charter was attached to our 2010 proxy statement asAnnex A;is available on the charter is not presently included on our Web site.Company’s website at www.cnob.com under Governance Documents.

Authority, Processes and Procedures.OurThe Compensation Committee is responsible for administering ourthe Company’s equity compensation plans, for establishing the compensation of our presidentthe Company’s President and chief executive officerChief Executive Officer and for recommending to the Board the compensation of ourthe other executive officers. OurThe Compensation Committee also establishes policies and monitors compensation for ourthe Company’s employees in general. While the Compensation

10

Committee may, and does in fact, delegate authority with respect to the compensation of employees in general, the Compensation Committee retains overall supervisory responsibility for employee compensation. With respect to executive compensation, the Compensation Committee receives recommendations and information from senior staff members, as well as outside compensation consultants, regarding issues relevant to determinations made by the Compensation Committee. Mr. WeagleySorrentino participates in Committee deliberations regarding the compensation of other executive officers, but does not participate in deliberations regarding his own compensation.

Consultants.The Compensation Committee recognizes that it is essential to receive objective advice from an outside compensation consultant. Currently,Prior to consummation of the Merger, the Committee has engagedutilized the services of Meyer Chatfield Compensation Advisors (MCCA)(“MCCA”), an independent compensation consulting firm strictly devoted to the community banking industry, as its outside consultant. MCCA was engaged by the Compensation Committee and doesdid not take direction from the Company’s executives, unless specifically advised to do so at the direction of the Compensation Committee.

Under the terms of this engagement, MCCA is required to obtain the prior approval of Currently, the Compensation Committee before MCCA performs any non-executiveutilizes Meridian Compensation Partners, LLC (“Meridian”) as its independent compensation related services toconsultant. Meridian had served as the Company. MCCA will reportcompensation consultant to the Compensation Committee any such servicesof Legacy ConnectOne.

Meridian reports directly to the Compensation Committee and fees annually and upon the reasonable request of the Committee.attends meetings as requested. The Compensation Committee determines whether MCCA's advice is objectivehas assessed Meridian’s independence relative to the NASDAQ listing rules and free from the influencedetermined that there are no conflicts of management.interest. The Compensation Committee also closely examines the safeguards and steps MCCAMeridian takes to ensure that its executive compensation consulting services are objective. The Compensation Committee takes into consideration that:

·

•

The Compensation Committee directly hired and has the authority to terminate MCCA'sMeridian’s engagement;

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•

·

The Compensation Committee solely determined the terms and conditions of MCCA'sMeridian’s engagement, including the fees charged;

·

•

The MCCA consultant is engaged by

Meridian and reports directly to the Compensation Committee;

·The MCCA consultant hasits consultants have direct access to members of the Compensation Committee during and between meetings;

·

•

MCCA

Meridian does not provide any other services provided to the Company, the Bank, its directors or executives; and

·

•

Interactions between the MCCA consultantMeridian and its consultants and management generally are limited to discussions on behalf of the Compensation Committee and information presented to the Compensation Committee for approval.

MCCA provided Management and the Committee with market data related to base salaries for all other employees to facilitate salary administration and appropriate cash incentives. Additionally, MCCA assisted with the design of a Mortgage Lender's Incentive Plan, TARP certifications and certain executive agreements, including a Non- Compete Agreement. MCCA provided additional information to the Committee as the Committee directed.

AuditNominating Committee Matters

Charter.  Our Board of Directors has established a separately-designated standing Audit Committee in accordance with Section 3(a)(58)(A) of the Securities Exchange Act of 1934. Our Board of Directors has defined the duties of its Audit Committee in a charter.  A copy of the current Audit Committee charter was attached to our 2010 proxy statement asAnnex B; the charter is not presently included on our Web site.

Independence of AuditNominating Committee MembersMembers..  Our common stock is listed on the Nasdaq Global Select Market and Center Bancorp is governed by the listing standards applicable thereto. All members of the AuditNominating Committee of the Board of Directors have been determined to be "independent directors"“independent directors” pursuant to the definition contained in Rule 4200(a)(15)5605 of the National Association of Securities Dealers'Dealers’ Marketplace Rules and under the SEC's Rule 10A-3.rules.

Audit Committee Financial Expert. Our Board of Directors has determined that one of the members of the Audit Committee, Raymond Vanaria, constitutes an "audit committee financial expert", as such term is defined by the SEC. As noted above, Mr. Vanaria - as well as the other members of the Audit Committee - has been determined to be "independent".

Audit Committee  Report.  In connection with the preparation and filing of Center Bancorp's Annual Report on Form 10-K for the year ended December 31, 2011:

(1)the Audit Committee reviewed and discussed the audited financial statements with our management;

(2)the Audit Committee discussed with our independent auditors the matters required to be discussed by the Statement on Auditing Standards No. 61, as amended;

(3)the Audit Committee received and reviewed the written disclosures and the letter from our independent auditors required by the Independence Standards Board Standard No. 1 (Independence Discussions with Audit Committees) and discussed with our independent auditors any relationships that may impact their objectivity and independence and satisfied itself as to the accountants' independence; and

(4)based on the review and discussions referred to above,  the Audit Committee recommended to our Board that the audited financial  statements be included in our Annual Report on Form 10-K for the year ended December 31, 2011.

By: The Audit Committee of the Board of Directors

James J. Kennedy

Howard Kent

Harold Schechter

William Thompson

Raymond Vanaria

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Accounting Fees and Other Accounting Matters

In accordance with the requirements of the Sarbanes-Oxley Act of 2002 and the Audit Committee's charter, all audit and audit-related work and all non-audit work performed by our principal independent accountant is approved in advance by the Audit Committee, including the proposed fees for such work. The Audit Committee is informed of each service actually rendered that was approved through its pre-approval process.

Audit Fees. Audit fees billed or expected to be billed to us by our principal independent accountant for the audit of the financial statements included in our Annual Report on Form 10-K for the years ended December 31, 2010 and 2011, and reviews of the financial statements included in our Quarterly Reports on Form 10-Q during 2010 and 2011, totaled $255,299 and $267,816, respectively.

Audit-Related Fees. A total of $116,676 and $31,577 in audit-related fees was billed for fiscal years 2010 and 2011, respectively. Such services are defined as services which are reasonably related to the performance of the audit or review of our financial statements but are not reported under the immediately preceding paragraph.

Tax Fees. We were billed an aggregate of $25,984 and $23,083 by our principal independent accountant for the fiscal years ended December 31, 2010 and 2011, respectively, for tax services, principally representing advice regarding the preparation of income tax returns.

All Other Fees. We were billed $0 and $19,500 by our principal independent accountant for the fiscal years ended December 31, 2010 and 2011, respectively, for all services not covered in the immediately three preceding paragraphs.

Other Matters. The Audit Committee has determined that the provision of all services provided by our principal independent accountant during the years ended December 31, 2010 and December 31, 2011 is compatible with maintaining the independence of our principal independent accountant.

Nominating Committee Matters

Independence of Nominating Committee Members.  All members of the Nominating Committee of our Board of Directors have been determined to be "independent directors" pursuant to the definition contained in Rule 4200(a)(15) of the National Association of Securities Dealers' Marketplace rules.

Procedures for Considering Nominations Made by ShareholdersShareholders..  The Nominating Committee'sand Corporate Governance Committee charter describes procedures for nominations to be submitted by shareholders and other third-parties, other than candidates who have previously served on the Boardboard or who are recommended by the Board. The charter states that a nomination must be delivered to ourCompany’s corporate Secretary at the principal executive offices of Center Bancorpthe Company not later than the close of business on the 90th day nor earlier than the close of business on the 120th day prior to the first anniversary of the preceding year'syear’s annual meeting; provided, however, that if the date of the annual meeting is more than 30 days before or more than 60 days after such anniversary date, notice to be timely must be so delivered not earlier than the close of business on the 120th day prior to such annual meeting and not later than the close of business on the later of the 90th day prior to such annual meeting or the close of business on the 10th day following the day on which public announcement of the date of such meeting is first made by us. The public announcement of an adjournment or postponement of an annual meeting will not commence a new time period (or extend any time period) for the giving of a notice as described above. The charter requires a

11

nomination notice to set forth as to each person whom the proponent proposes to nominate for election as a director: (a) all information relating to such person that is required to be disclosed in solicitations of proxies for election of directors in an election contest, or is otherwise required, in each case pursuant to Schedule 14A under the Securities Exchange Act of 1934, as amended (including such person'sperson’s written consent to being named in the proxy statement as a nominee and to serving as a director it elected), and (b) information that will enable the Nominating Committee to determine whether the candidate or candidates satisfy the criteria established pursuant to the charter for director candidates.

QualificationsQualifications..  The charter of the Nominating and Corporate Governance Committee describes the minimum qualifications for nominees to the Board and the qualities or skills that are necessary for directors to possess. Each nominee:

 · 

•

must satisfy any legal requirements applicable to members of the Board;board;

 · 

•

must have business or professional experience that will enable such nominee to provide useful input to the Boardboard in its deliberations;

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 · 

•

must have a reputation, in one or more of the communities serviced by Center Bancorpthe Company and its subsidiaries, for honesty and ethical conduct;

 · 

•

must have a working knowledge of the types of responsibilities expected of members of the board of directors of a bank holding company; and

 · 

•

must have experience, either as a member of the board of directors of another public or private company or in another capacity that demonstrates the nominee'snominee’s capacity to serve in a fiduciary position.

Identification and Evaluation of Candidates for the BoardBoard..  Candidates to serve on the Board will be identified from all available sources, including recommendations made by shareholders. The Nominating Committee'sCommittee’s charter provides that there will be no differences in the manner in which the nominating committee evaluates nominees recommended by shareholders and nominees recommended by the Committee or management, except that no specific process shall be mandated with respect to the nomination of any individuals who have previously served on the Board. The evaluation process for individuals other than existing Boardboard members will include:

·

•

a review of the information provided to the Nominating Committee by the proponent;

·

•

if requested, a review of reference letters from at least two sources determined to be reputable by the Nominating Committee; and

·

•

a personal interview of the candidate,

together with a review of such other information as the Nominating Committee shall determine to be relevant.

Third Party RecommendationsRecommendations..  In connection with the 20112015 annual meeting, the Nominating Committee did not receive any nominations from any shareholder or group of shareholders whichthat owned more than 5% of our common stock for at least one year.

Compensation Committee Interlocks and Insider Participation

There are no compensation committee “interlocks,” which generally means that no executive officer of the Company or the Bank served as a director or member of the compensation committee of another entity, one of whose executive officers serves as a director or member of the Compensation Committee.

Stock Ownership Guidelines

In order to ensure alignment of interests between Board members and the shareholders of the Company, the Company expects all Board members will have a meaningful investment in the common stock of the Company. To ensure this meaningful investment, all Board members will be required to own, directly or indirectly, at least $500,000 in initial market value of the Company’s common stock within 24 months of the director’s initial election.

12

 

Charter.  Board Leadership; Lead Independent Director

Historically the Company had an independent Chairman of the Board, separate from the Chief Executive Officer. However, upon consummation of the Merger with Legacy ConnectOne, the Board appointed Mr. Frank Sorrentino, the Company’s President and CEO, to serve as Chairman. The Board considered the fact that Mr. Sorrentino had served as Chairman, President and CEO of Legacy ConnectOne, believed that Board structure had worked well for Legacy ConnectOne and noted the success that Mr. Sorrentino had in growing Legacy ConnectOne. The Board believes that the combination of these two roles at this time provides the benefit of a more consistent communication and coordination throughout the organization. This in turn will result in a more effective and efficient implementation of corporate strategy and integration of the separate cultures of the Company and Legacy ConnectOne, and is further important in unifying the Company’s strategy behind a single vision.

Our Board has also appointed Mr. Stephen Boswell, an independent director, to serve as Lead Independent Director of the Board. As Lead Independent Director, Mr. Boswell presides over all Board meetings when the Chairman is not present, and presides over meetings of the non-management directors held in executive session. The Lead Independent Director has the responsibility of meeting and consulting with the Chairman and Chief Executive Officer on Board and committee meeting agendas, acting as a liaison between management and the non-management directors, including maintaining frequent contact with the Chairman and Chief Executive and advising him on the efficiency of the Board meetings, and facilitating teamwork and communication between the non-management directors and management.

Risk Oversight

Risk is an inherent part of the business of banking. Risks faced by the Bank include credit risk relating to its loans and interest rate risk related to its entire balance sheet. The Board of Directors oversees these risks through the adoption of policies and by delegating oversight to certain committees, including the Audit Committee and the Loan and Asset/Liability Committees of the Bank. These committees exercise oversight by establishing a corporate environment that promotes timely and effective disclosure, fiscal accountability and compliance with all applicable laws and regulations.

13

EXECUTIVE COMPENSATION

Compensation Discussion and Analysis

The Compensation Committee (the “Committee”) and the Company are both committed to a pay-for-performance philosophy. This Compensation Discussion & Analysis (CD&A) provides information about the strategies and policies developed to ensure that executive compensation is strongly correlated with the Company’s overall performance and the individual performance of our executives.

The Merger and Management Changes

On July 1, 2014, we completed the Merger to create a financial institution with more than $3 billion in assets and 24 branches across Bergen, Essex, Hudson, Mercer, Monmouth, Morris and Union counties. The combined company is one of the largest New Jersey-based banking institutions with increased scale, technology and lending capabilities serving middle market commercial businesses.

Upon the closing of the merger, the Company was the surviving entity but assumed the name “ConnectOne” and adopted the ticker symbol “CNOB.” As a result, this CD&A discloses the 2014 compensation policies and decisions for the Company’s Named Executive Officers pre-Merger (“Pre-Merger Compensation”) as well as for the post-Merger executive team (“Post-Merger Compensation”).

The pre-Merger named executives are:

Pre-Merger NEOs

Role

Anthony C. Weagley

Chief Executive Officer

Francis R. Patryn

Chief Financial Officer

Arthur M. Wein

Vice President, Chief Operating Officer

James W. Sorge

Vice President, Compliance Officer

Following the Merger, these executives were either no longer executive officers or no longer employed by the Company.

After the Merger closed, we announced our ongoing leadership team including our named executive officers:

Post-Merger NEOs

Role

Frank Sorrentino III

Chairman, President, & Chief Executive Officer

William S. Burns

Executive Vice President & Chief Financial Officer

Elizabeth Magennis

Executive Vice President & Chief Lending Officer

Laura Criscione

Executive Vice President & Chief Compliance Officer

Aditya Kishore

Executive Vice President Chief Information/Operations Officer

Executive Summary

2014 was a transformational year for the Company. As a result of the Merger and continued organic growth, the Company grew from $1.67 billion in total assets and 16 offices at December 31, 2013 to $3.45 billion in total assets and 24 offices at year end 2014. While completing the integration of the Company and Legacy ConnectOne, we were also able to grow our loan portfolio by more than $231 million over the second half of the year. In determining compensation for 2014, the Compensation Committee considered the Company’s performance on a standalone basis as well as management’s performance in executing the Merger and integrating the two companies.

2014 Business Highlights

We delivered the following results in 2014:

•

Completed the merger of ConnectOne and Center on July 1, 2014

14

•

Realized meaningful cost efficiencies, with virtually all estimated cost savings to be derived from the Merger realized as of January 1, 2015

•

Increased loans receivable by approximately $225 million and total deposits by approximately $150 million through organic growth during the second half of 2014

•

Expanded loan generation and support teams while achieving meaningful efficiencies in executive, back office and administrative areas

•

Maintained strong asset quality, with a ratio of non-accrual loans to total loans receivable of 0.46% at December 31, 2014

Performance-Based Compensation

Pay-for-performance is a key objective of our executive compensation program. Our incentives for 2014 considered performance goals set before the Merger and the effectiveness of the integration of the two institutions. A significant amount of compensation in the post-Merger 2015 programs is performance-based (annual incentives and performance based equity awards). Our objective is to design our compensation program to reward executives for driving our business strategy and delivering results to our stockholders.

Compensation Design Principles and Governance Best Practices

The design principles of our executive compensation programs are intended to protect and promote the interests of our stockholders. Below we summarize certain practices we have implemented to drive performance and those we have not implemented because we do not believe they would serve our stockholder’s long-term interests.

•

What We Do:

•

Pay for Performance—We provide a significant portion of pay based on performance (short and long-term)

•

Sound Risk Management—We discourage excessive risk taking and have designed our incentive plans with appropriate design features

•

Clawback—Each incentive compensation agreement provides for clawback in the event of a financial restatement

•

Double-Trigger Change-in-Control (CIC)—CIC benefits pursuant to employment or change in control agreements are only paid upon a termination event following a CIC.

•

Independence—The Committee engages an independent compensation consultant

•

What We Don’t Do:

•

Tax Gross-Ups—We do not provide excise tax gross-ups on benefits or in change-in-control agreements

•

Repricing—Our equity plan does not permit repricing of stock options that are out-of-the-money

•

Excessive Perquisites—Our executives only receive perquisites that are business-related

Results of 2014 Say on Pay Advisory Vote

The Company solicited a shareholder advisory vote on executive compensation in 2014 which received 96% approval. Company shareholders approved a bi-annual advisory vote, thus our next shareholder vote will be in 2016.

Executive Compensation Objectives and Policies

We use our executive compensation programs to align the interests of executive officers with our shareholders. Our programs are designed to attract, retain and motivate leadership to support our growth and sustain our competitive advantage. Our compensation opportunities are aligned with

15

the competitive market with actual pay that is designed to vary dependent on performance. We utilize a balance of fixed and variable pay components, cash and equity, and short and long-term performance horizons to determine our pay. Our compensation program is designed to support our business strategies, align our pay with our performance and reinforce sound compensation governance to mitigate excessive risk taking. The table below gives an overview of the compensation components used in our program and matches each with one or more of the objectives described above.

Compensation Component

Purpose/Objective

Base Salary

•

Provides a competitive level of fixed income based on role, experience
and individual performance

Annual Incentive Plan

•

Motivates and rewards executives for performance on key financial,
operational and individual objectives in support of our annual business
plan and broader corporate strategies

•

Varies pay based on performance (higher performance will result in
above market pay; lower performance will result in below market pay)

Long-Term Incentive Plan

•

Drives value creation for stockholders over the long-term

•

Aligns executives’ interests with those of shareholders through
equity-based compensation

•

Encourages retention through multiple year vesting

•

Motivates and rewards executives for performance—vesting and value
is tied to achievement of specific performance and/or stock price
appreciation

Other Benefits

•

Provides a base level of competitive compensation for executive talent

Employment Agreements/Severance & CIC Agreements

•

Provides employment security to key executives

•

Focuses executives on company performance and transactions that are
in the best interests of shareholders, regardless of the impact such
transactions may have on the executive’s employment

Setting Annual Compensation

Roles & Responsibilities

Compensation Committee

The Compensation Committee of the Board of Directors is responsible for discharging the Board’s duties in executive compensation matters and for administering the Company’s incentive and equity-based plans. This includes oversight of the total compensation programs for the Company’s CEO and other executive officers, including all Named Executive Officers. The Committee is comprised solely of independent directors. The Committee receives input and data from Finance and Human Resources functions as well as outside consultants and advisors to provide external reference and perspective.

The Committee reviews all compensation components for the Company’s Chief Executive Officer and other executive officers, including base salary, annual incentive, long-term incentives/equity and other benefits and perquisites. The Committee reviews the Chief Executive Officer’s performance annually and makes decisions regarding the Named Executive Officers’ compensation, including base salary, incentives and equity grants based on this review. The Compensation Committee reviews its decisions with the full Board of Directors.

The Committee has defined the dutiessole authority and resources to obtain advice and assistance from internal or external legal, human resources, accounting or other advisors, or consultants as it deems desirable or appropriate. The Committee has direct access to outside advisors and consultants

16

throughout the year as they relate to executive compensation. The Committee has direct access to and meets periodically with the compensation consultant independently of management.

Independent Compensation Consultant

Prior to the Merger, Legacy ConnectOne retained Meridian as its compensation consultant and the Company retained MCCA to act as the Committees’ independent consultant. Following the Merger, the Company engaged Meridian as its compensation consultant. Our consultants aid the Committee in satisfying its responsibilities. Meridian reports directly to the Committee and performs no other work for the Company.

The Consultants reported directly to the Committee and carried out their responsibilities to the Committee in coordination with the Company’s Finance and Human Resources staff as requested by the Committee. The Committee Chair has regular contact with the Consultants outside meetings as appropriate. The Committee has reviewed and concluded that Meridian’s consultation services, and that prior to the merger, MCCA’s consultation services, comply with the standards adopted by the SEC and by Nasdaq with respect to compensation advisor independence and conflicts of interest.

Management

Although the Committee makes independent determinations on all matters related to compensation of the Named Executive Officers, certain members of management may be requested to attend or provide input to the Committee. Input may be sought from the Chief Executive Officer, Chief Financial Officer, or others to ensure the Committee has the information and perspective it needs to carry out its duties.

In particular, the Committee seeks input from the Chief Executive Officer on matters relating to strategic objectives, Company performance goals and input on his assessment of the Named Executive Officers, including contribution and individual performance of each of his direct reports. The Chief Executive Officer and the Chief Financial Officer often assist the Committee on matters of design, administration and operation of the Company’s compensation programs.

Although executives may provide insight, suggestions or recommendations regarding executive compensation, they are not present during the Compensation Committee’s deliberations or vote. Only Compensation Committee members vote on decisions regarding executive compensation. The Committee regularly meets in executive session without management present. While the Chief Executive Officer makes recommendations on other Named Executive Officers, the Committee is ultimately responsible for approving compensation for all Named Executive Officers. The Chief Executive Officer’s compensation is discussed in executive session without members of management, including the Chief Executive Officer.

Peer Group & Competitive Benchmarking

In light of the pending Merger, the Company did not conduct a competitive benchmark analysis for 2014 compensation. Following the Merger, Meridian provided market compensation data to the Compensation Committee based on the peer group set forth below. This data was used to assist the Committee in setting pay levels and target pay opportunities (short and long-term) for the post-merger pay programs.

The Committee worked with the consultant to develop a peer group that was appropriate for the newly-combined Company. The Committee considered commercial banks that were similarly-sized (approximately1/2x to 2x the Company’s post-Merger assets) and primarily located in similar regions. Based on this assessment, the Committee approved the following peer group to be used for benchmarking purposes. The median assets for this group is $3.0 billion, in line with the Company’s post-merger assets.

17

2014 Post-Merger Peer Group

Bancorp, Inc.

Lakeland Bancorp

Bridge Bancorp, Inc

Peapack-Gladstone Financial Corp.

Bryn Mawr Bank Corporation

S&T Bancorp

Customers Bancorp

Sandy Spring Bancorp

Eagle Bancorp

Sterling Bancorp

First Commonwealth Financial Corp.

Sun Bancorp

First of Long Island Corporation

TriState Capital Holdings

Flushing Financial Corporation

Univest Corporation of PA

Hudson Valley Holding Corp.

Pre-Merger Executive Compensation:

In this section we review the components of our executive compensation programs during the pre-Merger period. These pay programs and decisions primarily affected executive officers who are no longer with the Company.

Base Salary

Base salaries provide a consistent amount of fixed compensation that focuses on rewarding an executive’s scope of responsibility, capabilities, and potential growth. When reviewing base salaries, the Committee considers each individual’s specific responsibilities, length of service and experience, market data, and overall performance of the individual.

 

 

 

 

 

Executive

 

2013 Annual Base Salary
(as of 12/31/13)

 

2014 Annual Base Salary
(as of 6/30/14)

 

Anthony Weagley

 

 

$

 

418,300

 

 

 

$

 

418,300

 

 

Francis Patryn

 

 

$

 

162,156

 

 

 

$

 

178,372

 

 

Arthur Wein

 

 

$

 

192,862

 

 

 

$

 

198,648

 

 

James Sorge

 

 

$

 

155,000

 

 

 

$

 

158,875

 

Annual Incentive Opportunity

In light of the pending Merger, executives did not participate in an annual incentive plan in 2014.

Long-Term Incentives—Equity-Based Awards

While the Company had an existing long-term incentive plan prior to the close of the Merger, there were no grants made to any Named Executive Officers during 2014 under that plan.

Post-Merger Executive Compensation:

In this section we review the components of our executive compensation programs. The post-Merger pay programs and decisions are for the Company’s leadership team going forward.

Base Salary

In conjunction with the merger, the Committee engaged Meridian to conduct a benchmarking analysis to provide competitive market reference for the newly combined organization. Base salaries were set following the Merger to align with the new roles overseeing the larger organization. Below are the salaries for the executive team after the Merger.

18

Executive

Post-Merger Annual Base Salary
(effective July 1, 2014)

Frank Sorrentino III

$

595,000

William Burns

$

310,000

Elizabeth Magennis

$

285,000

Laura Criscione

$

225,000

Aditya Kishore

$

235,000

Annual Incentive

Prior to the Merger, Legacy ConnectOne executives participated in the Executive Annual Incentive Plan which provides cash incentives based on performance of pre-established goals. Each participant has a target incentive opportunity expressed as a percentage of base salary although actual payouts can range from no payout to 150% of target at stretch performance. The 2014 incentive targets are summarized below.

Annual Incentive Targets

 

 

 

 

 

 

 

 

 

Role

 

Below
Threshold

 

Threshold
(50%)

 

Target
(100%)

 

Maximum
(150%)

 

Chief Executive Officer

 

 

 

0

%

 

 

 

 

20

%

 

 

 

 

40

%

 

 

 

 

60

%

 

 

EVP, Chief Financial Officer

 

 

 

0

%

 

 

 

 

15

%

 

 

 

 

30

%

 

 

 

 

45

%

 

 

EVP, Chief Lending Officer

 

 

 

0

%

 

 

 

 

15

%

 

 

 

 

30

%

 

 

 

 

45

%

 

 

EVP, Chief Operations Officer

 

 

 

0

%

 

 

 

 

10

%

 

 

 

 

20

%

 

 

 

 

30

%

 

 

EVP, Compliance Officer

 

 

 

0

%

 

 

 

 

10

%

 

 

 

 

20

%

 

 

 

 

30

%

 

Following the Merger, the Company’s executives continued to participate in the Executive Annual Incentive Plan (“EAIP“), which was readopted by the Compensation Committee. However, the Compensation Committee determined that performance for 2014 should consist of an assessment of the executive team’s performance on a more comprehensive and qualitative basis considering performance prior to and following the Merger. In particular, given the complexities of a merger of equals, a key strategic goal for the last half of the year was ensuring successful integration of the two institutions.

To determine 2014 incentives the Compensation Committee considered the following factors:

•

Financial performance metrics, including core earnings, return on assets and return on equity and efficiency ratio for 2014

•

Speed of the conversion activities related to the Merger

•

Effectiveness of integration

•

Market reaction to the Merger

•

Attaining projected cost saves

•

Strong customer retention

As a result of its Nominatingreview and assessment of performance, the Committee determined that achievement of financial goals and integration results warranted incentive payouts at maximum. Following is a summary of the incentive awards paid to executives:

19

Executive

2014 Annual Incentive Award(1)

Frank Sorrentino III

$

178,500

William Burns

$

69,750

Elizabeth Magennis

$

64,125

Laura Criscione

$

34,000

Aditya Kishore(2)

$

0

(1)

Awards in this table reflect amount accrued for half the year commencing July 1 through December 31, 2014

(2)

Mr. Kishore was not employed by the Company at the time of payout and, therefore, did not receive a payment under the incentive plan.

The Company plans to return to the original EAIP plan structure for 2015 which will consist of quantitative performance goals and measures.

Long-Term Incentives—Equity-Based Awards

Prior to the Merger, Legacy ConnectOne had an established long-term incentive program. However, the Company did not grant any equity awards to executives post-Merger. Going forward in 2015, the Company will implement a new long-term incentive plan that will be performance-based, align executives with shareholder interests and promote the long-term success of the Company.

Effective February 2015, the Committee approved long-term incentive compensation program consisting of performance shares and time vested restricted stock. The performance-based restricted share unit awards will reflect our three year performance for the period January 1, 2015 through December 31, 2017. The actual number of shares to be received will range from 0% to 150% of the target levels depending on our performance relative to an industry index.

Benefits and Other Compensation

Retirement Benefits and Perquisites

Executives participate in the ConnectOne Bank 401(k) Retirement Plan which is offered to all Bank employees. Currently, the Bank does not offer any other retirement benefit to executives.

As stated in the Executive Compensation Objectives and Policies section, the Bank does not place emphasis on perquisites for NEOs. A car allowance is provided to this group and the recipients are expected to use this compensation to offset any and all automobile expenses (mileage, tolls, insurance, gas) incurred as part of their job duties.

Post-Termination Benefits for Certain Company Executives

Mr. Weagley’s Employment Agreement

Mr. Weagley entered into an Agreement, dated January 20, 2014 (the “New Agreement”), with the Company and UCNB, which was effective upon the Merger. The purpose of the New Agreement was to clarify certain rights and responsibilities of the parties under Mr. Weagley’s existing agreements in light of the merger.

The New Agreement provided that beginning at the effective time of the Merger, Mr. Weagley would serve as Chief Operating Officer of the combined company and the combined bank. As described in the New Agreement, he was to be an employee “at will” and paid a base salary of $35,000 per month. In the New Agreement, the parties agreed and acknowledged that consummation of the transactions contemplated by the merger agreement and the change in Mr. Weagley’s position from CEO to COO constituted a “Terminating Event” as defined in his existing Employment Agreement, entitling him to a payment of $1,679,790 thereunder upon the earlier of Mr. Weagley’s

20

separation from service at any time and for any reason (with or without cause and even if the separation from service is due to disability or death) following the effective time or upon the one-year anniversary of the effective time. Such payment was to be made in accordance with the terms of Mr. Weagley’s existing Employment Agreement. In addition, Mr. Weagley was entitled to receive the sum of $75,414 payable in 12 equal installments over the 12 months immediately following his separation from service in accordance with the regular payroll practices of the combined company, and all unvested restricted stock awards and/or unvested stock options held by him would become fully vested upon his separation from service for any reason (with or without cause and even if the separation from service is due to disability or death) at any time within the twelve (12) months immediately following the effective time. Upon the effective time, the combined company also waived its right to require Mr. Weagley to render consulting services under the existing Employment Agreement, and the existing Employment Agreement was deemed terminated.

The New Agreement also provided that for purposes of the Non-Compete Agreement between the Company and Mr. Weagley, Mr. Weagley will be deemed to have “separated from service” with the combined company on the date he resigns from service or is released from service by the combined company and/or the combined bank. Upon such separation from service, Mr. Weagley became entitled to a payment of $836,500 under the Non-Compete Agreement, as described therein.

Notwithstanding the provisions of the Non-Compete Agreement, certain of the specific restrictions contained in the Non-Compete Agreement (i) remain in effect for a twelve (12) month period commencing on the effective time, and (ii) shall not apply to prohibit Mr. Weagley from working in the banking or financial services business within the Commonwealth of Pennsylvania. Except as specifically modified by the terms of the New Agreement, the Non-Compete Agreement remains in full force and effect.

Upon Mr. Weagley’s departure from the Company on July 1, 2014, he received and will continue to receive for a period of one (1) year the payments as set forth in the New Agreement.

Other Executive Termination Payments

Upon their respective terminations, pursuant to individual severance agreements, Mr. Patryn, Mr. Wein, and Mr. Sorge received severance payments. Mr. Patryn’s severance payment was based upon negotiations at the time of his termination. Pursuant to the Severance Pay Policy that was established for the merger,, Mr. Patryn received a severance payment equal to 2 weeks of compensation for each year of service, resulting in a charter. A copypayment of 34 weeks of base salary. Additionally, Mr. Patryn was awarded a bonus payment of $61,744 paid as an incentive to remain employed through December 31, 2014 to assist with the Company integration.

Mr. Sorge and Mr. Wein both received severance payments pursuant to their severance agreements. These executives each received a payment of two times base salary and two times the annual car allowance amount. Additionally, each executive is eligible to receive continued health insurance benefits through COBRA, with the Bank reimbursing them the cost of the premiums less the amount they contributed to their health insurance premium while employed. Mr. Sorge participated for three months and has since terminated his COBRA eligibility. Additionally, Mr. Wein received an additional bonus payment of $20,000 Mr. Wein received the additional bonus payment as an incentive to remain employed until December 31, 2014. Mr. Sorge was terminated at the time of the merger so no incentive payment was required.

The above payments were subject to certain restrictive covenants including non-compete and non-solicitation agreements and confidentiality/non-disclosure and non-disparagement clauses.

Post-Termination Benefits for ConnectOne Executives

Mr. Sorrentino’s Employment Agreement

The employment agreement with Mr. Sorrentino has an initial three-year term, and will automatically renew for one additional year unless any party provides written notice of its intention not to renew. Under the agreement, Mr. Sorrentino will receive an annual base salary of $522,500,

21

subject to increase as determined by the Board. He will also be eligible to participate in ConnectOne’s incentive plans and other benefit plans for executive officers. Under the agreement, ConnectOne or ConnectOne Bank will reimburse Mr. Sorrentino for his reasonable business expenses, and provide him with a $1,250 monthly car allowance. In the event that Mr. Sorrentino’s employment is terminated without cause, he is entitled to receive a lump sum payment equal to the sum of (i) his then current Nominatingbase salary for the remaining term of the agreement, but no less than an amount equal to one year of base salary and (ii) the greater of the highest bonus paid to him over the prior 36 months, or the amount accrued for his bonus in the year of termination. In the event of a merger, acquisition or change-in-control transaction after which Mr. Sorrentino does not continue employment at the resulting entity in substantially the same position, under substantially the same terms and conditions under which he was employed prior to the change in control, he will receive a severance payment equal to the sum of (i) the highest annual base salary paid to him over the prior 36 month period, and (ii) the greater of the highest bonus paid to him over the prior 36 months, or the amount accrued for his bonus in the year of termination, multiplied by two plus one twelfth for each year of service completed by Mr. Sorrentino after January 1, 2007. The severance benefits are subject to reduction in the event the benefits would constitute an “excess parachute payment” under Section 280G of the Internal Revenue Code of 1986, as amended.

Mr. Burns’s Employment Agreement

Mr. Burns’s was party to an employment agreement with Legacy ConnectOne, which was assumed by the Company. It has an initial two-year term, which automatically renews for one additional year unless either party provides written notice of its intention not to renew. Under the agreement, Mr. Burns will receive an annual base salary of $240,000, subject to increase as determined by the Board. He will also be eligible to participate in the Company’s bonus plan for executive officers. Mr. Burns is also entitled to participate in all benefit programs of the Company and the Bank. Under the agreement, the Company or the Bank will reimburse Mr. Burns for his reasonable business expenses, and provide him with a $750 monthly car allowance. In the event that Mr. Burns’s employment is terminated without cause, he is entitled to receive the sum of (i) his then current annual Base Salary for the remainder of the Term (assuming there is no extension of the Term), but no less than one year of his then current Base Salary, and (ii) the highest cash bonus paid to Mr. Burns over the prior twenty four (24) month period, or the amount accrued during the current year for Mr. Burns’ cash bonus for that year, whichever is higher. In the event of a merger, acquisition or change-of-control transaction after which Mr. Burns does not continue employment at the resulting entity, he will receive a severance payment equal to the sum of (i) his highest annual Base Salary over the prior twenty four (24) month period plus (ii) the highest cash bonus paid to him over the prior twenty four (24) month period, or the amount accrued during the current year for his cash bonus for that year, whichever is higher, times two. The severance benefits are subject to reduction in the event the benefits would constitute an “excess parachute payment” under Section 280G of the Internal Revenue Code of 1986, as amended.

Ms. Magennis’s and Ms. Criscione’s Change in Control Agreements

The change in control agreements between each of Ms. Magennis and Ms. Criscione and Legacy ConnectOne were not triggered by the Merger and assumed by the Company. Under the terms of the Change in Control Agreements, if the Company were to undergo a “change in control” as defined in the Change in Control Agreements, followed by either (i) involuntary termination of employment by the Company or the Bank or (ii) voluntary termination of employment by the executive under certain circumstances provided for in the agreement, then the executive would be entitled to a lump sum payment equal to the highest annual salary assigned to her during the twenty four months prior to the Change in Control plus the highest annual bonus paid or accrued. Such amount shall be paid within 10 days, subject to compliance with section 409A of the Internal Revenue Code, after the Company receives an executed a general release of claims in favor of the Company, the Bank, their respective subsidiaries, affiliates, officers, directors, shareholders, partners, members, managers, agents or employees.

22

Additional Information about Our Compensation Practices

Policy on Incentive Compensation Clawback

Each executive compensation arrangement or Plan provides for a clawback in the event of a financial restatement.

Risk Assessment Review

The Committee reviews the structure and components of our compensation arrangements, the material potential sources of risk in our business lines and compensation arrangements, and various policies and practices of the Company that mitigate this risk. Within this framework, the Committee discusses the parameters of acceptable and excessive risk-taking and the general business goals and concerns of the Company. In particular, the Committee focuses on the risks associated with the design of each plan, the mitigation factors that exist for each plan, additional factors that could be considered and an overall risk assessment with respect to the plans. All of our plans have links to corporate or business line results that allow for funding to be adjusted downward, awards are capped, and our governance procedures ensure awards are reviewed for appropriateness before they are distributed.

We have determined that risks arising from our employee compensation plans are not reasonably likely to have a material adverse effect on the Company. Further, it is both the Committee’s and management’s intent to continue to evolve our processes going forward by monitoring regulations and best practices for sound incentive compensation.

Accounting & Tax Treatment of Compensation

The accounting and tax treatment of compensation generally has not been a factor in determining the amounts of compensation for our executive officers. However, the Compensation Committee and management have considered the accounting and tax impact of various program designs to balance the potential cost to the Company with the benefit to the executive.

Section 162(m) of the Internal Revenue Code generally disallows a tax deduction to public companies for annual non-performance based compensation over $1.0 million paid to their named executive officers. To maintain flexibility in compensating our executive officers in a manner designed to promote varying corporate goals, it is not a policy of the Compensation Committee that all executive compensation must be tax-deductible. The shareholder approved share-based compensation plans permit the award of stock options, stock appreciation rights and other equity awards that are fully deductible under Code Section 162(m).

Report of the Compensation Committee

The Compensation Committee has reviewed and discussed the Compensation Discussion and Analysis, or CD&A, contained in this proxy statement with management. Based on the Compensation Committee’s review of and discussion with management with respect to the CD&A, the Compensation Committee has recommended to the Board of Directors of the Company that the CD&A be included in this proxy statement and the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2014, for filing with the SEC.

The foregoing report is provided by the Compensation Committee of the Board of Directors:

Stephen Boswell (Chair)
Frederick Fish
William A. Thompson
Joseph Parisi, Jr

Summary Compensation Table

The following table sets forth for the prior three years the compensation paid to (a) each individual serving as Chief Executive Officer and Chief Financial Officer during 2014, (b) our three

23

other most highly compensated executive officers earning in excess of $100,000 serving as of the fiscal year ended December 31, 2014, and (c) the two individuals for whom disclosure would have been provided pursuant to clause (b) above but for the fact that such individual was not serving as an executive officer of the Company as of the fiscal year ended December 31, 2014 (collectively the “Named Executive Officers”).

Summary Compensation Table

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Name and
Principal Position

 

Year
(b)

 

Salary
($)
(c)

 

Bonus
($)
(d)

 

Stock
Awards
($)
(e)

 

Option
Awards
($)
(f)

 

Non-equity
incentive
plan
compensation
($)
(g)

 

Change in
pension
value and
non-qualified
deferred
compensation
earnings
($)
(h)

 

All other
compensation
($)
(i)

 

Total
($)
(j)

 

Frank Sorrentino III,
Chairman, President and
Chief Executive Officer(1)

 

2014

 

 

 

297,500

 

 

 

 

178,500

 

 

 

 

—

 

 

 

 

—

 

 

 

 

—

 

 

 

 

—

 

 

 

 

8,101

 

 

 

 

484,101

 

 

William S. Burns,
Executive Vice President,
Chief Financial Officer(1)

 

2014

 

 

 

155,000

 

 

 

 

69,750

 

 

 

 

—

 

 

 

 

—

 

 

 

 

—

 

 

 

 

—

 

 

 

 

7,063

 

 

 

 

231,813

 

 

Elizabeth Magennis,
Executive Vice President,
Chief Lending Officer(1)

 

2014

 

 

 

142,500

 

 

 

 

64,125

 

 

 

 

—

 

 

 

 

—

 

 

 

 

—

 

 

 

 

—

 

 

 

 

6,372

 

 

 

 

212,997

 

 

Laura Criscione,
Executive Vice President,
Chief Compliance Officer(1)

 

2014

 

 

 

112,500

 

 

 

 

34,000

 

 

 

 

—

 

 

 

 

—

 

 

 

 

—

 

 

 

 

—

 

 

 

 

5,474

 

 

 

 

151,974

 

 

Aditya Kishore,
Chief Information/
Operations Officer(1)(2)

 

2014

 

 

 

117,140

 

 

 

 

23,428

 

 

 

 

—

 

 

 

 

—

 

 

 

 

—

 

 

 

 

—

 

 

 

 

3,228

 

 

 

 

143,796

 

 

Anthony C. Weagley,
Former Principal
Executive Officer(3)

 

2014

 

 

 

209,150

 

 

 

 

—

 

 

 

 

—

 

 

 

 

—

 

 

 

 

—

 

 

 

 

134,960

 

 

 

 

2,531,742

 

 

 

 

2,875,852

 

 

 

 

2013

 

 

 

418,300

 

 

 

 

185,000

 

 

 

 

94,054

 

 

 

 

—

 

 

 

 

—

 

 

 

 

(48,303

)

 

 

 

 

25,161

 

 

 

 

674,212

 

 

 

 

2012

 

 

 

366,300

 

 

 

 

—

 

 

 

 

25,000

 

 

 

 

—

 

 

 

 

—

 

 

 

 

70,736

 

 

 

 

27,597

 

 

 

 

489,633

 

 

Francis R. Patryn,
Former Principal Financial and
Accounting Officer(4)

 

2014

 

 

 

177,020

 

 

 

 

—

 

 

 

 

—

 

 

 

 

—

 

 

 

 

—

 

 

 

 

57,662

 

 

 

 

182,385

 

 

 

 

417,067

 

 

 

 

2013

 

 

 

146,391

 

 

 

 

15,995

 

 

 

 

14,190

 

 

 

 

—

 

 

 

 

—

 

 

 

 

(6,299

)

 

 

 

 

6,250

 

 

 

 

176,527

 

 

 

 

2012

 

 

 

129,768

 

 

 

 

10,141

 

 

 

 

—

 

 

 

 

—

 

 

 

 

—

 

 

 

 

23,974

 

 

 

 

9,290

 

 

 

 

173,173

 

 

Arthur M. Wein,
Former Vice President and Chief Operating Officer(6)

 

2014

 

 

 

198,648

 

 

 

 

20,000

 

 

 

 

—

 

 

 

 

—

 

 

 

 

—

 

 

 

 

—

 

 

 

 

393,754

 

 

 

 

612,402

 

 

 

 

2013

 

 

 

192,862

 

 

 

 

—

 

 

 

 

19,673

 

 

 

 

—

 

 

 

 

18,341

 

 

 

 

—

 

 

 

 

11,633

 

 

 

 

242,509

 

 

 

 

2012

 

 

 

191,401

 

 

 

 

—

 

 

 

 

—

 

 

 

 

—

 

 

 

 

10,107

 

 

 

 

—

 

 

 

 

16,923

 

 

 

 

218,431

 

 

James W. Sorge,
Former Vice President and Compliance Officer(6)

 

2014

 

 

 

91,008

 

 

 

 

—

 

 

 

 

—

 

 

 

 

—

 

 

 

 

—

 

 

 

 

—

 

 

 

 

324,953

 

 

 

 

415,961

 

 

 

 

2013

 

 

 

152,171

 

 

 

 

—

 

 

 

 

23,362

 

 

 

 

—

 

 

 

 

26,257

 

 

 

 

—

 

 

 

 

11,153

 

 

 

 

212,943

 

 

 

 

2012

 

 

 

141,000

 

 

 

 

—

 

 

 

 

—

 

 

 

 

—

 

 

 

 

10,648

 

 

 

 

—

 

 

 

 

10,012

 

 

 

 

161,660

 

(1)

Mr. Sorrentino, Mr. Burns, Ms. Magennis, Ms. Criscione and Mr. Kishore each commenced employment with the Company on July 1, 2014 effective upon the consummation of the Merger. Prior to this date, each was an executive officer of Legacy ConnectOne Bancorp. The data provided above, accordingly, is with respect to their compensation commencing on July 1, 2014, and does not include information prior to this date.

(2)

Mr. Kishore left the Company effective February 1, 2015.

(3)

Mr. Weagley resigned from the Company effective July 1, 2014. Included in “All Other Compensation” for Mr. Weagley is a $1,679,790 severance payment under his employment

24

agreement, and an $836,500 payment under his non-compete agreement with the Company, both due upon his termination of service with the Company.

(4)

Mr. Patryn left the Company effective December 31, 2014. Included in “All Other Compensation” for Mr. Patryn is a $178,372 severance payment.

(5)

Mr. Wein’s employment with the Company ended effective December 31, 2014. Included in “All Other Compensation” for Mr. Wein is a $408,724.60 severance payment under his employment agreement with the Company.

(6)

Mr. Sorge left the Company effective July 1, 2014. Included in “All Other Compensation” for Mr. Sorge is a $320,000 severance payment under his employment agreement with the Company.

Employment Agreement

The Company and the Bank are parties to employment agreements with Messrs. Frank S. Sorrentino, III, our Chairman, Chief Executive Officer, and President, and Mr. William S. Burns our Executive Vice President and Chief Financial Officer.

The employment agreement with Mr. Sorrentino has an initial three-year term, and will automatically renew for one additional year unless any party provides written notice of its intention not to renew. Under the agreement, Mr. Sorrentino will receive an annual base salary of $525,500, subject to increase as determined by the Board. He will also be eligible to participate in the Company’s incentive plans and other benefit plans for executive officers. Under the agreement, the Company or Bank will reimburse Mr. Sorrentino for his reasonable business expenses, and provide him with a $1,250 monthly car allowance. In the event that Mr. Sorrentino’s employment is terminated without cause, he is entitled to receive a lump sum payment equal to the sum of (i) his then current base salary for the remaining term of the agreement, but no less than an amount equal to one year of base salary and (ii) the greater of the highest bonus paid to him over the prior 36 months, or the amount accrued for his bonus in the year of termination. In the event a merger, acquisition or change-in-control transaction after which Mr. Sorrentino does not continue employment at the resulting entity in substantially the same position, under substantially the same terms and conditions under which he was employed prior to the change in control, he will receive a severance payment equal to the sum of (i) the highest annual base salary paid to him over the prior 36 month period, and (ii) the greater of the highest bonus paid to him over the prior 36 months, or the amount accrued for his bonus in the year of termination, multiplied by two plus one twelfth for each year of service completed by Mr. Sorrentino commencing January 1, 2007. The severance benefits are subject to reduction in the event the benefits would constitute an “excess parachute payment” under Section 280G of the Internal Revenue Code of 1986, as amended. The following table summarizes potential payments to Mr. Sorrentino assuming a triggering termination of employment occurred on December 31, 2014. The table does not reflect benefits under plans that do not discriminate in favor of executive officers and are available generally to all salaried employees.

 

 

 

 

 

 

 

Payments and Benefits

 

Involuntary Termination
without Cause or
Resignation for
Good Reason

 

Change in
Control

 

Involuntary Termination
without Cause or
Resignation for
Good Reason
following a Change
in Control

 

Cash Compensation

 

 

$

 

1,894,083

 

 

 

$

 

0

 

 

 

$

 

2,459,333

 

 

Value of Continued Health and Welfare Benefits

 

 

$

 

53,731

 

 

 

$

 

0

 

 

 

$

 

20,799

 

 

Acceleration of Stock Awards

 

 

$

 

0

 

 

 

$

 

628,197

 

 

 

$

 

628,197

 

The employment agreement with Mr. Burns has an initial two-year term, and will automatically renew for one additional year unless either party provides written notice of its intention not to renew. Under the agreement, Mr. Burns will receive an annual base salary of $240,000, subject to

25

increase as determined by the Board. He will also be eligible to participate in the Company’s bonus plan for executive officers. Mr. Burns is also entitled to participate in all benefit programs of the Company and the Bank. Under the agreement, the Company or Bank will reimburse Mr. Burns for his reasonable business expenses, and provide him with a $750 monthly car allowance. In the event that Mr. Burns’s employment is terminated without cause, he is entitled to receive his then current annual Base Salary for the remainder of the term, but no less than one year of his then current Base Salary, plus an amount equal to the highest cash bonus paid to him over the prior twenty four (24) month period, or the amount accrued during the current year for Employee’s cash bonus for that year. In the event a merger, acquisition or change-in-control transaction after which Mr. Sorrentino does not continue employment at the resulting entity in substantially the same position, under substantially the same terms and conditions under which he was employed prior to the change in control, he will receive a severance payment equal to the sum of (i) the highest annual base salary paid to him over the prior 24 month period, and (ii) the greater of the highest bonus paid to him over the prior 24 months, or the amount accrued for his bonus in the year of termination, multiplied by two. The severance benefits are subject to reduction in the event the benefits would constitute an “excess parachute payment” under Section 280G of the Internal Revenue Code of 1986, as amended.The following table summarizes potential payments to Mr. Burns assuming a triggering termination of employment occurred on December 31, 2014. The table does not reflect benefits under plans that do not discriminate in favor of executive officers and are available generally to all salaried employees.

 

 

 

 

 

 

 

Payments and
Benefits

 

Involuntary Termination
without Cause or
Resignation for
Good Reason

 

Change in
Control

 

Involuntary Termination
without Cause or
Resignation for
Good Reason
following a Change
in Control

 

Cash Compensation

 

 

$

 

449,500

 

 

 

$

 

0

 

 

 

$

 

899,000

 

 

Value of Continued Health and Welfare Benefits

 

 

$

 

20,799

 

 

 

$

 

0

 

 

 

$

 

20,799

 

 

Acceleration of Stock Awards

 

 

$

 

0

 

 

 

$

 

136,211

 

 

 

$

 

136,211

 

The Company also was previously a party to employment agreements with Messrs. Weagley, Wein and Sorge, and a change in control agreement with Mr. Patryn. See “Compensation Discussion and Analysis” above.

Agreements upon Change in Control

Each of Ms. Criscione and Ms. Magennis has entered into change of control agreements with the Company. Under these agreements, in the event of a reorganization, merger, consolidation or sale of all or substantially all of the assets of the Company, or any similar transaction which results in our shareholders holding less than a majority of the voting power of the resulting entity, the employee is to be employed by our successor for a period of twelve (12) months plus one month for each year of service following the change in control. In the event they are terminated without cause, or they resign for good reason (as both terms are defined in the agreements), then each of Ms. Criscione and Ms. Magennis would be entitled to a lump sum payment equal to the highest annual salary assigned to each during the twenty four months prior to Change in Control plus the highest annual bonus paid to or accrued to each. They are also entitled to receive their benefits for a period of twelve (12) months after the change in control. The following tables summarizes potential payments to Ms. Criscione and Ms. Magennis assuming a triggering termination of employment occurred on December 31, 2014. The table does not reflect benefits under plans that do not discriminate in favor of executive officers and are available generally to all salaried employees.

26

Laura Criscione

 

 

 

 

 

Payments and
Benefits

 

Change in Control

 

Involuntary
Termination
without Cause or
Resignation for
Good Reason
following a Change
in Control

 

Cash Compensation

 

 

$

 

             0

 

 

 

$

 

292,250

 

 

Value of Continued Health and Welfare Benefits

 

 

$

 

0

 

 

 

$

 

0

 

 

Acceleration of Stock and Option Awards

 

 

$

 

0

 

 

 

$

 

0

 

Elizabeth Magennis

 

 

 

 

 

Payments and
Benefits

 

Change in Control

 

Involuntary
Termination
without Cause or
Resignation for
Good Reason
following a Change
in Control

 

Cash Compensation

 

 

$

 

0

 

 

 

$

 

413,250

 

 

Value of Continued Health and
Welfare Benefits

 

 

$

 

0

 

 

 

$

 

0

 

 

Acceleration of Stock and Option Awards

 

 

$

 

191,349

 

 

 

$

 

191,349

 

Grant of Plan Based Awards

No grants of plan based awards were made to the Named Executive Officers in 2014.

27

Outstanding Equity Awards At Year End

The following table sets forth, for each of the Named Officers, information regarding outstanding stock options and stock awards at December 31, 2014.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Name
(a)

 

Option awards

 

Stock awards

 

Number of
securities
underlying
unexercised
options
(#)
exercisable
(b)

 

Number of
securities
underlying
unexercised
options
(#)
unexercisable
(c)

 

Equity
incentive
plan
awards:
Number of
securities
unerlying
unexercised
unearned
options
(d)

 

Option
exercise
price
($)
(e)

 

Option
expiration
date
(f)

 

Number of
shares or
units of
stock that
have not
vested
(#)
(g)

 

Market
value of
shares or
units of
stock that
have not
vested
(#)
(h)

 

Equity
incentive
plan
awards:
Number of
unearned
shares,
units or
other rights
that have
not vested
(#)
(i)

 

Equity
incentive
plan
awards:
market or
payment value
of uneared
shares, units
or other rights
that have
not vested
(j)

Frank Sorrentino III(1)(2)

 

 

 

78,000

 

 

 

 

 

 

 

 

3.85

 

 

 

 

6/21/2015

 

 

 

 

33,061

 

 

 

 

628,159

 

 

 

 

 

 

 

 

 

10,655

 

 

 

 

 

 

 

 

6.15

 

 

 

 

11/11/2016

 

 

 

 

 

 

 

 

 

 

 

 

26,000

 

 

 

 

 

 

 

 

6.15

 

 

 

 

1/11/2018

 

 

 

 

 

 

 

 

 

 

 

 

 

10,871

 

 

 

 

 

 

 

 

6.15

 

 

 

 

1/21/2018

 

 

 

 

 

 

 

 

 

 

 

 

11,721

 

 

 

 

 

 

 

 

6.15

 

 

 

 

11/11/2018

 

 

 

 

 

 

 

 

 

 

 

 

 

51,935

 

 

 

 

 

 

 

 

4.62

 

 

 

 

11/26/2018

 

 

 

 

 

 

 

 

 

 

 

 

11,687

 

 

 

 

 

 

 

 

4.62

 

 

 

 

1/9/2019

 

 

 

 

 

 

 

 

 

 

 

 

 

13,000

 

 

 

 

 

 

 

 

4.62

 

 

 

 

2/25/2019

 

 

 

 

 

 

 

 

 

 

 

 

34,567

 

 

 

 

 

 

 

 

6.99

 

 

 

 

1/24/2022

 

 

 

 

 

 

 

 

 

William S. Burns(1)(2)

 

 

 

 

 

 

 

 

 

 

 

 

 

7,170

 

 

 

 

136,230

 

 

 

 

 

Elizabeth Magennis(1)(2)

 

 

 

5,200

 

 

 

 

 

 

 

 

6.15

 

 

 

 

11/11/2016

 

 

 

 

10,072

 

 

 

 

191,368

 

 

 

 

 

 

 

 

 

2,504

 

 

 

 

 

 

 

 

4.62

 

 

 

 

1/9/2019

 

 

 

 

 

 

 

 

 

 

 

 

5,158

 

 

 

 

 

 

 

 

6.99

 

 

 

 

1/24/2022

 

 

 

 

 

 

 

 

 

Laura Criscione(1)(2)

 

 

 

26,000

 

 

 

 

 

 

 

 

3.85

 

 

 

 

6/21/2015

 

 

 

 

 

 

 

 

 

 

 

 

7,800

 

 

 

 

 

 

 

 

6.15

 

 

 

 

5/5/2016

 

 

 

 

 

 

 

 

 

 

 

 

 

3,120

 

 

 

 

 

 

 

 

4.81

 

 

 

 

5/23/2016

 

 

 

 

 

 

 

 

 

 

 

 

6,204

 

 

 

 

 

 

 

 

6.15

 

 

 

 

1/11/2018

 

 

 

 

 

 

 

 

 

 

 

 

 

5,218

 

 

 

 

 

 

 

 

4.62

 

 

 

 

1/9/2019

 

 

 

 

 

 

 

 

 

 

 

 

3,900

 

 

 

 

 

 

 

 

4.62

 

 

 

 

2/25/2019

 

 

 

 

 

 

 

 

 

 

 

 

 

5,616

 

 

 

 

 

 

 

 

6.99

 

 

 

 

1/24/2022

 

 

 

 

 

 

 

 

 

Aditya Kishore

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Anthony C. Weagley

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Francis R. Patryn

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Arthur M. Wein

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

James W. Sorge

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(1)

All option and stock awards were granted subject to a three-year vesting requirement, with one-third of the award vesting on the first anniversary of the date of grant, one-third of the award vesting on the second anniversary of the date of grant, and the final third vesting on the third anniversary of the date of grant.

(2)

Shares are valued at market value, which is deemed to be book value, at December 31, 2014.

Options Exercised and Stock Vested

The following table sets forth certain information regarding exercises of options or vesting of restricted shares during the Company’s fiscal year ended December 31, 2014:

28

 

 

 

 

 

 

 

 

 

 

 

 Option awards

 

Stock awards

 

 

 

Name
(a)

 

 Number of
 shares
 acquired
 on
 exercise
 (#)
 (b)

 

Value
realized on
exercise
($)
(c)

 

Number of
shares
acquired
on vesting
(#)
(d)

 

Value
realized on
vesting
($)
(e)

 

Frank Sorrentino III

 

 

 

 

 

 

 

 

 

William S. Burns

 

 

 

 

 

 

 

2,165

 

 

 

 

40,745

 

 

Elizabeth Magennis

 

 

 

 

 

 

 

 

 

Laura Criscione

 

 

 

 

 

 

 

 

 

Aditya Kishore

 

 

 

 

 

 

 

 

 

Anthony C. Weagley

 

 

 

9,659

 

 

 

 

83,572

 

 

 

 

7,291

 

 

 

 

140,206

 

 

Francis R. Patryn

 

 

 

 

 

 

 

1,100

 

 

 

 

21,153

 

 

Arthur M. Wein

 

 

 

 

 

 

 

1,525

 

 

 

 

29,326

 

 

James W. Sorge

 

 

 

 

 

 

 

1,811

 

 

 

 

34,826

 

Pension Benefits

The following table sets forth, for each of the Named Officers, information regarding the benefits payable under each of Center’s plans that provides for payments or other benefits at, following, or in connection with such Named Officer’s retirement. Those plans are summarized below the following table. The following table does not provide information regarding tax-qualified defined contribution plans or nonqualified defined contribution plans.

 

 

 

 

 

 

 

 

 

Pension Benefits

 

Name
(a)

 

Plan name
(b)

 

Number of
years
credited
services
(#)
(c)

 

Present
value of
accumulated
benefit
($)
(d)

 

Payments
during last
fiscal year
($)
(e)

 

Frank Sorrentino III

 

 

 

 

 

 

 

 

 

William S. Burns

 

 

 

 

 

 

 

 

 

Elizabeth Magennis

 

 

 

 

 

 

 

 

 

Laura Criscione

 

 

 

 

 

 

 

 

 

Aditya Kishore

 

 

 

 

 

 

 

 

 

Anthony C. Weagley

 

Union Center National
Bank Pension Plan Trust

 

 

 

23

 

 

 

 

473,581

 

 

 

 

0

 

 

Francis R. Patryn

 

Union Center National
Bank Pension Plan Trust

 

 

 

9

 

 

 

 

255,944

 

 

 

 

0

 

 

Arthur M. Wein

 

 

 

 

 

 

 

 

 

James W. Sorge

 

 

 

 

 

 

 

 

In the table above:

•

The Company has determined the years of credited service based on the same pension plan measurement date that the Company used in preparing its audited financial statements for the year ended December 31, 2014; we refer to that date as the “Plan Measurement Date”;

29

•

when we use the phrase “present value of accumulated benefit”, we are referring to the actuarial present value of the Named Officer’s accumulated benefits under the Company’s pension plans, calculated as of the Plan Measurement Date;

•

the present value of accumulated benefits shown in the table above has been determined using the assumptions set forth in the Company’s audited financial statements for the year ended December 31, 2014; and

•

column (e) refers to the dollar amount of payments and benefits actually paid or otherwise provided to the Named Officer during 2014 under the Company’s pension plans

The Union Center National Bank Pension Trust—which we refer to as the “Pension Plan”—is intended to be a tax-qualified defined benefit plan under Section 401(a) of the Internal Revenue Code. The Pension Plan, which has been in effect since March 15, 1950, generally covers employees of the Bank and the Company who have attained age 21 and completed one year of service. The normal retirement (age 65) pension payable under the Pension Plan is generally equal to 44% of a participant’s highest average compensation over a 5-year period. Compensation means a participant’s W-2 wages, increased by certain reductions such as 401(k) contributions. The normal retirement benefit is proportionately reduced if a participant has less than 25 years of service at age 65. None of the Company’s Named Officers was eligible to retire with a normal retirement pension as of December 31, 2014.

The Company froze the benefits under the Pension Plan effective as of September 30, 2007. All future benefit accruals in the Pension Plan were discontinued and all retirement benefits that employees would have earned as of September 30, 2007 have been preserved. While benefits have been frozen, the present value of the projected future cash payments may change from period to period.

A participant may retire before or after age 65. A participant will qualify for immediate commencement of an early retirement pension if he or she retires after attaining age 60 and completing at least six years of service. A participant who completes five years of service is entitled to a vested pension commencing at normal retirement age or after meeting the early retirement requirements. Early retirement and vested pension benefits are calculated in the same manner as a normal retirement pension, but are multiplied by a fraction the numerator of which is the participant’s years of service and the denominator of which is the number of years of service the participant would have accumulated through normal retirement. Benefits payable prior to normal retirement are also subject to adjustment for actuarial equivalence, using age and interest factors specified by the Pension Plan. Based upon their ages and years of service, none of the Company’s Named Executive Officers is currently eligible for an early retirement pension under the Pension Plan.

The Company does not currently have any non-qualified deferred compensation plans in effect.

30

Director Compensation

The following table sets forth certain information regarding compensation earned by or paid to the Directors during the Company’s fiscal year ended December 31, 2014:

Director Compensation

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Name
(a)

 

Fees earned
or paid
in cash
($)
(b)

 

Stock
Awards
($)
(c)

 

Options
awards
($)
(d)

 

Non-equity
incentive plan
compensation
($)
(e)

 

Change in
pension value
and
nonqualified
deferred
compensation
earnings
($)
(f)

 

All other
compensation
($)
(g)

 

Total
($)
(h)

 

Frank W. Baier

 

 

 

21,450

 

 

 

 

 

 

 

 

 

 

 

 

 

 

21,450

 

 

Stephen T. Boswell

 

 

 

21,750

 

 

 

 

 

 

 

 

 

 

 

 

 

 

21,750

 

 

Frederick Fish

 

 

 

32,900

 

 

 

 

 

 

 

 

 

 

 

 

 

 

32,900

 

 

Frank Huttle III

 

 

 

19,200

 

 

 

 

 

 

 

 

 

 

 

 

 

 

19,200

 

 

Michael Kempner

 

 

 

17,375

 

 

 

 

 

 

 

 

 

 

 

 

 

 

17,375

 

 

Howard Kent

 

 

 

38,700

 

 

 

 

 

 

 

 

 

 

 

 

 

 

38,700

 

 

Nicolas Minoia

 

 

 

39,450

 

 

 

 

 

 

 

 

 

 

 

 

 

 

39,450

 

 

Joseph Parisi Jr.

 

 

 

18,000

 

 

 

 

 

 

 

 

 

 

 

 

 

 

18,000

 

 

Harold Schechter

 

 

 

34,500

 

 

 

 

 

 

 

 

 

 

 

 

 

 

34,500

 

 

William A. Thompson

 

 

 

33,100

 

 

 

 

 

 

 

 

 

 

 

 

 

 

33,100

 

 

Raymond J. Vanaria

 

 

 

40,750

 

 

 

 

 

 

 

 

 

 

 

 

 

 

40,750

 

 

Alexander Bol

 

 

 

25,800

 

 

 

 

 

 

 

 

 

 

 

 

 

 

25,800

 

 

Lawrence B. Seidman

 

 

 

17,600

 

 

 

 

 

 

 

 

 

 

 

 

 

 

17,600

 

For information concerning Messrs. Sorrentino and Weagley, who served as directors during 2014, please see the “Summary Compensation Table”.

Messrs. Bol and Seidman resigned from the Board of Directors on July 1, 2014 upon the closing of the transaction contemplated by the Agreement and Plan of Merger dated January 20, 2014 as reported on the Current Report on Form 8-K filed on even date therewith.

We pay the non-employee members of the Company’s Board a fee of $1,200 per Board meeting attended and $900 per Bank Board Committee meeting attended. Our Directors are also eligible to participate in our equity compensation plans, although no grants were made in 2014.

Interest of Management and Others in Certain Transactions; Review, Approval or Ratification of Transactions with Related Persons

Under its charter, the Audit Committee reviews and approves all related party transactions, other than extensions of credit by the Bank in the ordinary course of its business. Under banking regulation, those extensions of credit must be approved by the full Board of Directors. For additional procedures, see the Audit Committee charter, which is available to shareholders on the Company’s website at www.cnob.com. By “related party transaction,” we mean a transaction between the Company or any of its subsidiaries, on the one hand, and an executive officer, director or immediate family member of an executive officer or a director, on the other hand.

The Bank has made in the past and, assuming continued satisfaction of generally applicable credit standards, expects to continue to make loans to directors, executive officers and their associates (i.e. corporations or organizations for which they serve as officers or directors or in which they have beneficial ownership interests of ten percent or more). These loans have all been made in the ordinary course of the Bank’s business on substantially the same terms, including interest rates

31

and collateral, as those prevailing at the time for comparable transactions with persons not affiliated with the Company and do not involve more than the normal risk of collectability or present other unfavorable features.

We utilize the MWW Group to provide advertising and public relations assistance and advice. Michael Kempner, one of our directors, is the President and CEO of the MWW Group, Inc.. During 2014, we paid the MWW Group a total of $210,670 for its services, including marketing, branding and related services We believe the fees charged the Bank by the MWW Group are at least as favorable to the Bank as we could receive from an unaffiliated third party. We have continued to use the services of the MWW Group during 2015.

Members of our Board of Directors, including our Chairman and CEO Frank Sorrentino and Messrs. Boswell, Huttle, Kempner and Parisi, are, either directly or through their interests in family limited liability companies, members of a limited liability company that is the sole member of two other limited liability companies which each own one of our branches, which are leased to the Bank. Our Board members collectively own 55.5% of the membership interests in this limited liability company. Each of Messrs. Sorrentino, Huttle, Parisi, and Kempner owns an 11.1% interest in the limited liability company. No director is the managing member or a manager or officer or any of the limited liability companies which serve as the landlords or the parent limited liability company.

The lease for our Cresskill branch has an initial term ending on June 30, 2026. The Bank has the option to extend the lease term for up to three additional five-year periods, or a total of fifteen additional years. The initial rent for the branch was attached$157,795 per year, and the rent will increase annually by the greater of 2.50% or the rate of increase of the consumer price index for the greater New York metropolitan area. In 2016, the rent will be reset to the greater of the prior year’s rent, or the “market rent” as defined under the lease, and will thereafter increase annually by the greater of 2.50% or the rate of increase of the consumer price index for the greater New York metropolitan area. During any option period, the rent will be reset to the greater of the prior year’s rent or the “market rent”, as defined in the lease, and will then increase annually by the greater of 2.50% or the rate of increase of the consumer price index for the greater New York metropolitan area. For 2012, the Bank paid total rent of $184,509 for the Cresskill branch.

The lease for our 2010 proxy statementJohn Street, Hackensack branch has a term ending on December 31, 2016. The Bank has the option to extend the lease term for up to three additional five-year periods, or a total of fifteen additional years. The initial rent for the branch was $148,000 per year, and the rent will increase annually by the greater of 2.50% or the rate of increase of the consumer price index for the greater New York metropolitan area. During any option period, the rent will be reset to the greater of the prior year’s rent or the “market rent”, asAnnex C; defined in the charterlease, and will then increase annually by the greater of 2.50% or the rate of increase of the consumer price index for the greater New York metropolitan area. For 2012, the Bank paid total rent of $192,017 for the John Street, Hackensack branch.

Because of the interests of Board members in these leases, the Board determined that the rent should be set at “fair market rent.” Under regulations of the New Jersey Department of Banking and Insurance, any real estate transaction with members of a bank’s board of directors must be subject to an appraisal by an independent appraisal firm, which must opine that the terms of the transaction are arm’s length terms and as beneficial to the bank as it could obtain from a third party. The Bank therefore retained an independent appraisal firm to review the properties and determine the fair market rent, and this rent was used for the leases. These leases were then submitted to and approved by the New Jersey Department of Banking and Insurance. Based upon appraisals we obtained prior to entering into each lease, we believe the lease terms are as fair to the Bank as it would have received from an unaffiliated third party.

32

PROPOSAL 2

RATIFICATION OF INDEPENDENT AUDITORS

The Audit Committee has appointed the firm of Crowe Horwath LLP to act as our independent registered public accounting firm and to audit our consolidated financial statements for the fiscal year ending December 31, 2015. This appointment will continue at the pleasure of the Audit Committee and is presented to the stockholders for ratification as a matter of good governance. In the event that this appointment is not presently includedratified by our stockholders, the Audit Committee will consider that fact when it selects independent auditors for the following fiscal year.

Crowe Horwath LLP has served as our independent registered public accounting firm since the closing of the Merger on our Web site.July 1, 2014, and one or more representatives of Crowe Horwath LLP will be present at the Annual Meeting. These representatives will be provided an opportunity to make a statement at the Annual Meeting if they desire to do so and will be available to respond to appropriate questions from stockholders.

Prior to July 1, 2014, BDO USA, LLP served as the Company’s independent registered public accounting firm. BDO USA, LLP was engaged on July 8, 2013. Prior to this date, ParenteBeard LLC served as the Company’s independent registered public accounting firm.

The following table sets forth a summary of the fees billed or expected to be billed to the Company by (i) BDO USA, LLP for professional services rendered for the year ended December 31, 2013 and (ii) Crowe Horwath and BDO USA, LLP for professional services rendered for the year ended December 31, 2014.

Principal Accounting Firm Fees

Aggregate fees billed to the company for the fiscal years ended December 31, 2014 and 2013 by the Company’s principal accounting firm are shown in the following table.

 

 

 

 

 

 

 

Fiscal Year Ended December 31

 

2014

 

2013

Audit Fees

 

 

$

 

533,000

 

 

 

$

 

277,334

 

Audit Related Fees

 

 

 

0

 

 

 

 

32,000

 

Tax Fees(1)

 

 

 

38,000

 

 

 

 

33,500

 

Other Fees

 

 

 

33,741

 

 

 

 

0

 

 

 

 

 

 

Total Fees

 

 

$

 

604,471

 

 

 

$

 

342,834

 

 

 

 

 

 

(1)

Consists of tax filing and tax related compliance and other advisory services.

Required Vote

THE PROPOSAL TO RATIFY THE SELECTION OF CROWE HORWATH LLP AS OUR INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM FOR THE 2015 FISCAL YEAR REQUIRES AN AFFIRMATIVE VOTE OF THE MAJORITY OF THE SHARES REPRESENTED IN PERSON OR BY PROXY AT THE ANNUAL MEETING AND ENTITLED TO VOTE ON THE PROPOSAL.

Recommendation

THE BOARD OF DIRECTORS RECOMMENDS THAT THE STOCKHOLDERS VOTE “FOR” THE RATIFICATION OF CROWE HORWATH LLP AS THE COMPANY’S INDEPENDENT AUDITORS

33

 

CodeSHAREHOLDER PROPOSALS

Proposals of Ethics

We are requiredshareholders to disclose whether we have adopted a code of ethics that applies to our principal executive officer, principal financial officer, principal accounting officer or controller or persons performing similar functions. We have adopted such a code of ethics and have posted a copybe included in the Company’s 2016 proxy material must be received by the secretary of the code on our internet website at the internet address: http://www.ucnb.com. Copies of the code may be obtained free of charge from our website at the above internet address.Company no later than December 1, 2015.

Compliance with Section 16 of the Securities Exchange Act of 1934

SECTION 16(A) BENEFICIAL OWNERSHIP
REPORTS COMPLIANCE

Section 16(a) of the Securities Exchange Act of 1934 requires our directors, executivethe Company’s officers and directors, and persons holdingwho own more than 10%ten percent of a registered class of the Company’s equity securities, of Center Bancorp to file with the SEC and to provide us with initial reports of ownership reports ofand changes in ownership with the Securities and annual reports of ownership of our common stockExchange Commission. Officers, directors and other equity securities. As a resultgreater than ten percent stockholders are required by regulation of the adoptionSecurities and Exchange Commission to furnish the Company with copies of the Sarbanes-Oxley Act of 2002, the reporting obligations with respect to certain transactions were accelerated to 48 business hours after the transaction. Based solely upon a review of such reports furnished to us, we believeall Section 16(a) forms they file. The Company believes that all suchpersons associated with the Company and subject to Section 16(a) reports werehave made all required filings on a timely filed with respect tobasis for the fiscal year ended December 31, 2011,2014, except that director Lawrence Seidman inadvertently reportedfor Stephen T. Boswell, who due to a clerical error, filed a report for a transaction occurring November 2, 2014 three stock purchases late, director Howard Kent inadvertently reported one stock purchase late and Anthony Weagley inadvertently reported one stock purchasedays late.

-29-

OTHER MATTERS

PROPOSAL 2

RATIFICATION OF THE APPOINTMENT OF

PARENTEBEARD LLC AS THE COMPANY'S

INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM FOR 2012

Action will be taken at the Annual Meeting to ratify the selectionThe Board of ParenteBeard LLC as independent registered public accounting firm of the Company for the fiscal year ending December 31, 2012. ParenteBeard LLC was created when two accounting firms, Parente Randolph and Beard Miller Company, combined on October 1, 2009. Beard Miller Company had served as the Company's independent auditors since May 5, 2006. The Company has been advised by ParenteBeard LLC that neither the firm, nor any member of the firm, has any financial interest, direct or indirect, in any capacity in the Company. We are asking our shareholders to ratify the selection of ParenteBeard LLC as our independent registered public accounting firm. Although ratificationDirectors is not required by our Bylaws or otherwise, the Board considers the selectionaware of the independent registered accounting firm to be an important matter of shareholder concern and is submitting the selection of ParenteBeard LLC to our shareholders for ratification as a matter of good corporate practice.

Approval of the ratification of ParenteBeard LLC as the Company's independent registered public accounting firm for 2012 will require the affirmative vote of a majority of the votes cast atany other matters which may come before the Annual Meeting. Abstentions and broker non votes will not be counted as votes cast and therefore will not affectHowever, in the outcomeevent such other matters come before the meeting, it is the intention of the voting.

Representatives of ParenteBeard LLC are expected to be present atpersons named in the Annual Meeting, will be afforded the opportunity to make a statement if they desire to do so, and are expected to be available to respond to appropriate questions.

THE BOARD OF DIRECTORS RECOMMENDS A VOTE "FOR" PROPOSAL 2.

PROPOSAL 3

ADVISORY VOTE ON EXECUTIVE COMPENSATION

Background of the Proposal

The Dodd-Frank Wall Street Reform and Consumer Protection Act and the SEC rules issued thereunder require shareholders of public companiesproxy to vote on an advisory basis, to approve executive compensation as disclosedany such matters in the proxy statement.

Accordingly, Center Bancorp’s shareholders are being asked to approve the compensation of Center Bancorp’s executives as disclosed in this proxy statement, including the Compensation Discussion and Analysis, the various compensation tables and the related narrative disclosures.

Executive Compensation

We believe that our compensation policies and procedures, which are reviewed and approved by the Compensation Committee, encourage a culture of pay for performance and are strongly alignedaccordance with the long-term interests of shareholders.

Shareholders are encouraged to carefully review the "Executive Compensation" section of this Proxy Statement for a detailed discussion of the Company's executive compensation program.

The proposal set forth below, which is advisory and will not bind the Board, gives Center Bancorp’s shareholders the opportunity to vote on the compensation of our executives.

Upon the recommendation of the Board of Directors.

Shareholders are urged to sign the enclosed proxy, which is solicited on behalf of the Board of Directors, Center Bancorp asks shareholders to considerand return it in the following resolution:enclosed envelope.

34

-30-
 

“Resolved, that the shareholders of Center Bancorp, Inc. approve the compensation of Center Bancorp’s executives, as described in the Company’s proxy statement for the 2012 Annual Meeting of Shareholders,including the Compensation Discussion and Analysis, the various compensation tables and the related narrative disclosures.”

 

Vote Required; EffectVOTE BY INTERNET - www.proxyvote.com

Use the Internet to transmit your voting instructions and for electronic delivery of information up until 11:59 P.M. Eastern Time the day before the cut-off date or meeting date. Have your proxy card in hand when you access the web site and follow the instructions to obtain your records and to create an electronic voting instruction form.

 

Approval ofELECTRONIC DELIVERY OF FUTURE PROXY MATERIALS

If you would like to reduce the compensation of the Company's executives will require the affirmative vote of a majority of the votes cast at the Annual Meeting. Abstentions and broker non votes will not be counted as votes cast and therefore will not affect the determination as to whether such compensation is approved. Because this shareholder vote is advisory, it will not be binding upon the Board of Directors. However, the Compensation Committee will take into account the outcome of the vote when considering future executive compensation arrangements.

THE BOARD OF DIRECTORS RECOMMENDS THAT THE SHAREHOLDERS VOTE "FOR" PROPOSAL 3.

PROPOSAL 4

ADVISORY VOTE ON FREQUENCY OF SAY ON PAY VOTES

As describedcosts incurred by our company in Proposal 3 above, the Company’s shareholders are being provided the opportunity to cast an advisory vote to approve the Company’s executive compensation. The advisory vote on executive compensation described in Proposal 3 above is referred to as a “Say-on-Pay” vote. This Proposal 4 affords shareholders the opportunity to cast an advisory vote on how often the Company should include a Say-on-Pay vote in itsmailing proxy materials, you can consent to receiving all future proxy statements, proxy cards and annual reports electronically via e-mail or the Internet. To sign up for electronic delivery, please follow the instructions above to vote using the Internet and, when prompted, indicate that you agree to receive or access proxy materials electronically in the future. Under this Proposal 4, shareholders may vote to have the Say-on-Pay vote every year, every two years or every threefuture years.

 

The Board of Directors believes that its Say-on-Pay vote should be conducted every two years. The Compensation Committee, which administersVOTE BY PHONE - 1-800-690-6903

Use any touch-tone telephone to transmit your voting instructions up until 11:59 P.M. Eastern Time the executive compensation program, valuesday before the opinions expressed by shareholderscut-off date or meeting date. Have your proxy card in these votes,hand when you call and even though non-binding, will continue to considerthen follow the outcome of these votes in making its decisions on executive compensation.instructions.

 

The Board of Directors believes an advisory voteVOTE BY MAIL

Mark, sign and date your proxy card and return it in the postage-paid envelope we have provided or return it to approve our executive officer compensation should occur every two years and recommends a vote FOR the following resolution:Vote Processing, c/o Broadridge, 51 Mercedes Way, Edgewood, NY 11717.

TO VOTE, MARK BLOCKS BELOW IN BLUE OR BLACK INK AS FOLLOWS: x
KEEP THIS PORTION FOR YOUR RECORDS
DETACH AND RETURN THIS PORTION ONLY

 

“RESOLVED, that future shareholder advisory votes regarding the compensation paid to the Company’s named executive officers shall be held every two years.”

Vote Required; Effect

With respect to Proposal 4, the option of one year, two years or three years that receives the highest number of votes cast will be the frequency of the vote on the compensation of our named executive officers that has been approved by the shareholders on an advisory basis.  With respect to Proposal 4, only those votes cast (for annual votes, votes every two years or votes every three years) will be included. Abstentions and broker non-votes will be counted only for the purpose of determining whether a quorum is present at the Annual Meeting.

Because this shareholder vote is advisory, it will not be binding upon the Board of Directors. However, the Board will take into account the outcome of the vote. As indicated above, the Board is recommending that shareholders vote for an advisory vote to approve executive compensation every two years.

The Board of Directors recommends a vote "FOR" Proposal 4.

INDEPENDENT PUBLIC AUDITORS

The Audit Committee of our Board of Directors has appointed ParenteBeard LLC to perform the function of independent public auditors for the year ending December 31, 2012.  See Proposal 2.  Representatives of ParenteBeard LLC are expected to attend our annual meeting and will be available to respond to appropriate questions of shareholders.  Such representatives will have an opportunity to make a statement at the annual meeting if they so desire.

-31-

SHAREHOLDER MATTERS

If a shareholder intends to present a proposal at our 2013 Annual Meeting of shareholders, the proposal must be received by us at our principal executive offices not later than December 17, 2012 in order for that proposal to be included in the proxy statement and form of proxy relating to that meeting, and by March 2, 2013 in order for the proposal to be considered at our 2013 annual meeting of shareholders (but not included in the proxy statement or form of proxy for such meeting).  Any shareholder proposal which is received after those dates or which otherwise fails to meet the requirements for shareholder proposals established by regulations of the SEC will neither be included in the proxy statement or form of proxy, nor be considered at the meeting.  For a description of procedures for nominations to be submitted by shareholders, see "Nominating Committee Matters."

Our Board has established a procedure that enables shareholders to communicate in writing with members of the Board. Any such communication should be addressed to the Chairman of the Board of Center Bancorp and should be sent to such individual c/o Center Bancorp, Inc., 2455 Morris Avenue, Union, New Jersey 07083. Any such communication must state, in a conspicuous manner, that it is intended for distribution to the entire Board of Directors. Under the procedures established by our Board, upon the Chairman's receipt of such a communication, our corporate Secretary will send a copy of such communication to each member of our Board, identifying it as a communication received from a shareholder. Absent unusual circumstances, at the next regularly scheduled meeting of our Board held more than two days after such communication has been distributed, our Board will consider the substance of any such communication.

Our Board members are encouraged, but not required by any specific Board policy, to attend Center Bancorp's annual meeting of shareholders. All of the then current members of our Board attended our 2011 annual meeting of shareholders.

OTHER MATTERS

Our Board is not aware that any other matters are to be presented for action, but if any other matters properly come before the Annual Meeting, or any adjournments thereof, the holder of any proxy is authorized to vote thereon at his or her discretion.

A copy of the Annual Report of Center Bancorp and Union Center National Bank for the year ended  December  31,  2011 is being mailed to shareholders with this proxy statement. The Annual Report is not to be regarded as proxy soliciting material or as a communication by means of which any solicitation is to be made.

A COPY OF THE COMPANY'S ANNUAL REPORT ON FORM 10-K FOR THE YEAR ENDED DECEMBER 31, 2011 (EXCLUDING EXHIBITS) WILL BE FURNISHED WITHOUT CHARGE TO ANY SHAREHOLDER MAKING A WRITTEN REQUEST FOR THE SAME TO JOSEPH GANGEMI, INVESTOR RELATIONS OFFICER, CENTER BANCORP, INC., 2455 MORRIS AVENUE, UNION, NEW JERSEY 07083.THIS  PROXY  CARD  IS  VALID  ONLY  WHEN  SIGNED  AND  DATED.

 

  By Order
ForWithholdFor AllTo withhold authority to vote for any individual nominee(s), mark “For All Except” and write the number(s) of the nominee(s) on the line below.
AllAllExcept
The Board of Directors recommends you vote FOR the following:
¨¨¨
1.Election of Directors
Nominees
              
01Frank Sorrentino III 02Frank W. Baier 03Alexander A. Bol 04Stephen Boswell 05Frederick Fish
06Frank Huttle III 07Michael Kempner 08Nicholas Minoia 09Joseph Parisi Jr. 10Harold Schechter
11William A. Thompson 12Raymond J. Vanaria         
              
The Board of Directors recommends you vote FOR the following proposal:ForAgainstAbstain
2.To ratify the appointment of Crowe Horwath LLP as the Company’s independent registered public accountants for the fiscal year ending December 31, 2015.¨¨¨
NOTE:In their discretion, such other business as shall properly come before the meeting.   
   /s/ Anthony C. Weagley
  Anthony C. Weagley
  President and Chief Executive Officer
Dated: April 16, 2012
  

-32-Please sign exactly as your name(s) appear(s) hereon. When signing as attorney, executor, administrator, or other fiduciary, please give full title as such. Joint owners should each sign personally. All holders must sign. If a corporation or partnership, please sign in full corporate or partnership name by authorized officer.Investor  Address  Line  1
Investor  Address  Line  2
Investor  Address  Line  3
Investor  Address  Line  4
Investor  Address  Line  5
John  Sample
1234  ANYWHERE  STREET
ANY  CITY,  ON  A1A  1A1
 

CENTER BANCORP, INC.

Proxy For Annual Meeting of Shareholders

KNOW ALL MEN BY THESE PRESENTS, that I, the undersigned shareholder of Center Bancorp, Inc., Union, New Jersey, do hereby constitute and appoint Joseph Gangemi and Arthur M. Wein, or any one of them (with full power to act alone), my true and lawful attorney(s) with full power of substitution for me and in my name, place and stead to vote all of the common stock of said corporation standing in my name on its books on April 2, 2012, at the annual meeting of shareholders to be held at Suburban Golf Club, 1730 Morris Avenue, Union, New Jersey 07083 on May 24, 2012 at 9:00 o'clock a.m. or at any adjournments thereof, with all powers the undersigned would possess if personally present, as shown on the reverse side.

(See Reverse Side)

Please date, sign and mail your proxy card back as soon as possible!

Annual Meeting of Shareholders - May 24, 2012

CENTER BANCORP, INC.

¨ Please mark your

votes as in this

example.

This proxy is being solicited on behalf of the Board of Directors and may be revoked prior to its exercise.

1. Election of Directors for one year terms ending in 2012

Nominees: Alexander A. Bol, Anthony C. Weagley, Frederick S. Fish, James J. Kennedy, Howard Kent, Nicholas Minoia, Harold Schechter, Lawrence B. Seidman, William A. Thompson and Raymond Vanaria.

Instruction: to withhold authority to vote for any individual nominee, write that nominee's name in the space provided below:

Grant AuthorityWithhold AuthoritySHARES
for all nomineesfor all nomineesCUSIP #
¨¨

2.  For ratification of ParenteBeard LLC as Center Bancorp's independent auditors for 2012.

FORAGAINSTABSTAINJOB #SEQUENCE #
¨¨Signature [PLEASE SIGN WITHIN BOX]¨DateSignature (Joint Owners)Date

3. To vote, on an advisory basis, to approve the executive compensation of Center Bancorp's named executive officers, as described in this proxy statement.

FORAGAINSTABSTAIN
¨¨¨

4. To seek a non-binding vote on how often Center Bancorp will conduct the non-binding vote to approve executive compensation.

EVERY YEAREVERY TWO YEARSEVERY THREE YEARSABSTAIN
¨¨¨¨

 

 

5. Other Business - Whatever other business may

Important Notice Regarding the Availability of Proxy Materials for the Annual Meeting: The Notice & Proxy Statement, Annual Report is/are available atwww.proxyvote.com.

CONNECTONE BANCORP, INC.
Revocable Proxy for
Annual Meeting of Shareholders
May 6, 2015
Solicited on behalf of the Board of Directors

The undersigned hereby appoints the board of directors of ConnectOne Bancorp, Inc. (the “Company”), and each of them to vote all of the shares of the Company standing in the undersigned’s name at the Annual Meeting of shareholders of the Company, to be brought before the meeting orheld at 145 Dean Dr., Tenafly, NJ 07670 on May 6, 2015 at 8:15 am., and any adjournment thereof.

If The undersigned hereby revokes any other business is properly presented at said meeting, this proxy shall be voted in accordance with the recommendations of management. Unless otherwise specified, execution of this proxy will confer authority to the persons named herein asand all proxies to vote shares in favor of the Board's nominees for directors, in favor of proposals 2 and 3 and,heretofore given with respect to proposal 4, “Every two year.”such meeting.

 

Important: To assure your representation atThis proxy will be voted as specified above. If no choice is specified, the meeting, please date, signproxy will be voted “FOR” Management’s nominees to the Board of Directors, and mail this proxy promptly in“FOR” ratification of the envelope provided.appointment of Crowe Horwath LLP as the Company’s independent registered public accountants.

 

Note: When signing as attorney, executor, administrator, trustee or guardian, please give full titles. If more than one trustee, all should sign. All joint owners should sign.

 

Signature: ________________________

Signature:_________________________

Dated: __________, 2012Continued and to be signed on reverse side

 

Important notice regarding the availability of proxy materials for the 2012 annual meeting of shareholders: The Proxy Statement for the 2012 annual meeting of Shareholders and our 2011 Annual Report to Shareholders are available at:http://www.rtcoproxy.com/cnbc.