URSTADT BIDDLE PROPERTIES INC.
321 RAILROAD AVENUE
GREENWICH, CONNECTICUT 06830
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
March 10, 2004
Notice is hereby given that the Annual Meeting of Stockholders of Urstadt Biddle
Properties Inc. will be held at Doral Arrowwood, Anderson Hill Road, Rye Brook,
New York, on Wednesday, March 10, 2004, at 11:00 a.m. for the following
purposes:
1. To elect one Director to serve for one year and to elect three
Directors to serve for three years;
2. To ratify the appointment of Ernst & Young LLP as the independent
auditors of the Company for one year;
3. To amend the Company's Dividend Reinvestment and Share Purchase
Plan;
4. To amend the Company's Restricted Stock Award Plan; and
5. To transact such other business as may properly come before the
meeting or any adjournments thereof.
Stockholders of record as of the close of business on January 26, 2004 are
entitled to notice of and to vote at the Meeting.
WHETHER OR NOT YOU PLAN TO BE PRESENT AT THE MEETING IN PERSON,
PLEASE SIGN AND DATE THE ENCLOSED PROXY AND RETURN IT PROMPTLY
IN THE ENCLOSED ENVELOPE.
By Order of the Directors
THOMAS D. MYERS
Secretary
February 6, 2004
URSTADT BIDDLE PROPERTIES INC.
321 RAILROAD AVENUE
GREENWICH, CONNECTICUT 06830
PROXY STATEMENT
FOR
ANNUAL MEETING OF STOCKHOLDERS
to be held on March 10, 2004
This Proxy Statement is furnished to stockholders of Urstadt Biddle
Properties Inc., a Maryland corporation (hereinafter called the "Company"), in
connection with the solicitation of proxies in the form enclosed herewith for
use at the Annual Meeting of Stockholders of the Company (the "Meeting") to be
held at Doral Arrowwood, Anderson Hill Road, Rye Brook, New York, on March 10,
2004 at 11:00 a.m. for the purposes set forth in the Notice of Meeting.
The solicitation is made on behalf of the Directors of the Company and
the costs of the solicitation will be borne by the Company. Directors, officers
and employees of the Company and its affiliates may also solicit proxies by
telephone, fax or personal interview. The Company will reimburse banks,
brokerage firms and other custodians, nominees and fiduciaries for reasonable
expenses incurred by them in sending proxy material to the beneficial owners of
the shares.
Holders of record of Class A Common Shares and Common Shares of the
Company as of the close of business on the record date, January 26, 2004, are
entitled to receive notice of, and to vote at, the Meeting. The outstanding
Class A Common Shares and Common Shares constitute the only classes of
securities entitled to vote at the Meeting. Each Common Share entitles the
holder thereof to one vote and each Class A Common Share entitles the holder
thereof to 1/20 of one vote. At the close of business on January 26, 2004, there
were 18,611,534 Class A Common Shares issued and outstanding and 7,038,435
Common Shares issued and outstanding.
Shares represented by proxies in the form enclosed, if such proxies are
properly executed and returned and not revoked, will be voted as specified, but
where no specification is made, the shares will be voted as follows: (i) FOR the
election of the four Directors; (ii) FOR the ratification of the appointment of
Ernst & Young LLP as the Company's independent auditors for the ensuing fiscal
year; (iii) FOR the amendment of the Company's Dividend Reinvestment and Share
Purchase Plan; (iv) FOR the amendment of the Company's Restricted Stock Award
Plan; and, as to any other matter which may properly come before the Meeting, in
the named proxies' discretion to the extent permitted under relevant laws and
regulations. To be voted, proxies must be filed with the Secretary of the
Company prior to voting. Proxies may be revoked at any time before exercise by
filing a notice of such revocation, by filing a later dated proxy with the
Secretary of the Company or by voting in person at the Meeting.
The Annual Report to stockholders for the Company's fiscal year ended
October 31, 2003 has been mailed with or prior to this Proxy Statement. This
Proxy Statement and the enclosed proxy were mailed to stockholders on or about
February 9, 2004. The principal executive offices of the Company are located at
321 Railroad Avenue, Greenwich, Connecticut 06830 (telephone: 203-863-8200; fax:
203-861-6755).
PROPOSAL 1
ELECTION OF DIRECTORS
Pursuant to Section 6.2 of the Articles of Incorporation, the Directors are
divided into three classes serving three-year terms. Four Directors are to be
elected at the Meeting. Mr. Charles D. Urstadt, currently a Director in Class I
whose term expires at the upcoming Annual Meeting, has been nominated by the
Board of Directors for election as a Director to fill a vacancy among Class II,
to hold office together with the other Class II Directors until the year 2005
Annual Meeting and until his successor has been elected and shall qualify. The
Board of Directors also has nominated Mr. Robert J. Mueller, who is not
currently a Director, and Messrs. Willing L. Biddle and E. Virgil Conway,
presently Directors in Class I, for election as Directors in Class I to hold
office until the year 2007 Annual Meeting and until their successors have been
elected and shall qualify.
(NOMINATED FOR ELECTION, TO SERVE AMONG CLASS II
FOR ONE YEAR)
Principal Occupation Director Term
For the Past Five Years Continuous to
Name And Current Directorships Age Since Expire
Charles D. Urstadt (E) President and Director, Urstadt Property Company, Inc. 44 1997 2005
(since 1990); Executive Vice President, Brown Harris
Stevens, LLC; (1992-2001); Publisher, New York
Construction News (1984-1992); Member, Board of
Consultants of the Company (1991-1997); Director, Friends
of Channel 13 (1992-2001); Board Member, New York State
Board for Historic Preservation (1996-2002); President
and Director, East Side Association (1994-1997);
Director, New York Building Congress (1988-1992).
2
(NOMINATED FOR ELECTION, TO SERVE AMONG CLASS I
FOR THREE YEARS)
Robert J. Mueller, Age 62, is a Senior Executive Vice President of The Bank of
New York where his responsibilities include the Bank's trading operations,
commercial real estate lending, regional commercial banking, residential
mortgage lending and equipment leasing. He is a member of the Bank's Senior
Planning Committee. Mr. Mueller currently serves on the Boards of the Community
Preservation Corp., the Alliance for Downtown New York, Inc. and the Borough of
Manhattan Community College Fund. He is an Advisory Board Member of Neighborhood
Housing Services of New York, Inc. and Chairman of the Special Business
Committee for Downtown Priorities.
The Company maintains a variety of banking relationships with The Bank of New
York which is also the Company's transfer agent. Mr. Mueller has announced his
retirement from the Bank, effective March 31, 2004.
OTHER MEMBERS OF CLASS I
(NOMINATED FOR ELECTION, TO SERVE FOR
THREE YEARS)
Principal Occupation Director Term to
For the Past Five Years Continuous Expire
------
Name And Current Directorships Age Since
Willing L. Biddle (E) President and Chief Operating Officer of the Company 42 1997 2007
since December 1996; Executive Vice President from
March 1996 to December 1996; Senior Vice
President-Management from June 1995 to March 1996; and
Vice President - Retail from April 1993 to June 1995.
Advisory Director, Putnam Trust Company.
E. Virgil Conway Chairman, Rittenhouse Advisors, LLC; Chairman, 74 1989 2007
(C)(N) Metropolitan Transportation Authority (1995-2001);
Chairman, Financial Accounting Standards Advisory
Council (1992-1995); Chairman and Director, The
Seamen's Bank for Savings, FSB (1969-1989); Trustee,
Consolidated Edison Company of New York, Inc.
(1970-2002); Director, Union Pacific Corporation
(1978-2002); Trustee, Phoenix Duff & Phelps Mutual
Funds; Trustee, Atlantic Mutual Insurance Company
(1974-2002); Director, Centennial Insurance Company
(1974-2002); Trustee, Josiah Macy Foundation; Vice
Chairman, Academy of Political Science; Trustee
Emeritus, Pace University; Trustee Emeritus, Colgate
University.
3
OTHER MEMBERS OF CLASS II
(TERM OF OFFICE EXPIRES IN 2005)
Principal Occupation Director
For the Past Five Years Continuous Term to
Name And Current Directorships Age Since Expire
Peter Herrick (A)(E)(N) Retired Vice Chairman (1990-1992) and Director, The 76 1990 2005
Bank of New York; President and Chief Operating
Officer, The Bank of New York (1982-1990); President
and Director, The Bank of New York Company, Inc.
(1984-1992); Member, New York State Banking Board
(1990-1993); Director, Mastercard International
(1985-1992); Director, BNY Hamilton Funds, Inc. (1992-
1999).
George J. Vojta (A)(N) Retired Vice Chairman and Director, Bankers Trust 68 1999 2005
Company (1992-1999); Executive Vice President, Bankers
Trust Company (1984-1992); Member, New York State
Banking Board; Director, Private Export Funding
Corporation; Chairman, Wharton Financial Institutions
Center; Chairman, The Westchester Group, LLC; Director,
Financial Services Forum; Member, Council on Foreign
Relations; Chairman, Caux Roundtable; Chairman, E
Standards Forum/Financial Standards Foundation;
Chairman, The International Institute for Corporate
Governance; Member Advisory Board, Yale School of
Management; Director, International Executive Service
Corps.; Member, Center for International Private
Enterprise.
4
CLASS III
(TERM OF OFFICE EXPIRES IN 2006)
Principal Occupation Director
For the Past Five Years Continuous Term to
Name And Current Directorships Age Since Expire
Robert R. Douglass Of Counsel, Milbank, Tweed, Hadley and McCloy; 72 1991 2006
(A)(C)(N) Chairman and Director, Clearstream International;
Chairman and Director, Cedel International
(1994-2002); Retired Vice Chairman and Director, The
Chase Manhattan Corporation (1985 - 1993); Executive
Vice President, General Counsel and Secretary, The
Chase Manhattan Corporation (1976 - 1985); Trustee,
Dartmouth College (1983 - 1993); Chairman, Downtown
Lower Manhattan Association; Chairman of Alliance
for Downtown New York; Member, Council on Foreign
Relations.
George H.C. Lawrence President and Chief Executive Officer, Lawrence 66 1988 2006
(C)(N) Properties, Inc. (since 1970); Honorary Trustee,
Sarah Lawrence College; Director, Westchester County
Association; Senior Vice President and Director,
Kensico Cemetery; Chairman, Board of Trustees,
Indian River Hospital District.
Charles J. Urstadt (E) Chairman of the Board of Directors and Chief 75 1975 2006
Executive Officer of the Company (since 1989);
Chairman and Director, Urstadt Property Company, Inc.
(a real estate investment corporation); Vice
Chairman, Battery Park City Authority; Trustee,
Historic Hudson Valley; Retired Director, Putnam
Trust Company; Trustee Emeritus, Pace University;
Retired Trustee, Teachers Insurance and Annuity
Association.
--------------------------------
(A) Member of Audit Committee
(C) Member of Compensation Committee
(E) Member of Executive Committee
(N) Member of Nominating and Corporate Governance Committee
During the fiscal year ended October 31, 2003, the Directors held six
meetings. The Directors have four standing committees: an Audit Committee, a
Compensation Committee, an Executive Committee and a Nominating and Corporate
Governance Committee. Each Director attended at least 75% of the aggregate total
number of meetings held during the fiscal year by the Directors and by all
committees of which such Director is a member.
The Audit Committee consists of three non-employee Directors, each of
whom is independent as defined in the listing standards (as amended from time to
time) of the New York Stock Exchange. The Audit Committee assists the Board of
Directors in fulfilling its oversight responsibilities. The Committee's primary
duties are to: (i) monitor the integrity of the Company's financial statements,
financial reporting processes and systems of internal controls regarding finance
and accounting matters; (ii) monitor the Company's compliance with legal and
regulatory requirements relating to the foregoing; (iii) monitor the
independence and performance of the Company's independent auditors and internal
auditing function; (iv) provide an avenue of communication among the Board, the
independent auditors, management and persons responsible for the internal audit
function; and (v) prepare an Audit Committee report as required by the
5
SEC to be included in the Company's annual proxy statement. The Board of
Directors has approved a written charter for the Audit Committee, the full text
of which is attached to this Proxy Statement as Appendix A. The charter may also
be viewed on the Company's website at http:\\www.ubproperties.com. The Audit
Committee has sole authority to appoint, retain, oversee and, when appropriate,
terminate the independent auditors of the Company. The Committee reviews with
management and the independent auditors the Company's quarterly financial
statements and internal accounting procedures and controls, and reviews with the
independent auditors the scope and results of the auditing engagement. Messrs.
Robert R. Douglass, Peter Herrick and George J. Vojta are the current members of
the Audit Committee. The Board of Directors has determined that Mr. Peter
Herrick, Chair of the Committee, meets the standards of an "Audit Committee
Financial Expert" as that term is defined under the Sarbanes-Oxley Act of 2002.
The Compensation Committee consists of three non-employee Directors,
each of whom is independent as defined in the listing standards (as amended from
time to time) of the New York Stock Exchange. The Compensation Committee held
one meeting during the fiscal year ended October 31, 2003. Key responsibilities
of the Compensation Committee include: (i) reviewing the Company's overall
compensation strategy to assure that it promotes shareholder interests and
supports the Company's strategic objectives; (ii) reviewing and approving
corporate goals and objectives relevant to compensation of the Company's Chief
Executive Officer and President, evaluating those officers' performance in light
of those goals and objectives and establishing the compensation of the Company's
Chief Executive Officer; (iii) reviewing and recommending to the Board
compensation for Directors; (iv) administering the Company's Stock Option Plan
and Restricted Stock Plan and approving bonus or cash incentive plans used to
compensate officers and other employees; and (v) preparing a report to be
included in the Company's annual proxy statement. The Board of Directors has
approved a written charter for the Compensation Committee, the text of which may
be viewed on the Company's website at http:\\www.ubproperties.com. Messrs. E.
Virgil Conway, Robert R. Douglass and George H. C. Lawrence are the current
members of the Compensation Committee.
The Executive Committee held two meetings during the fiscal year ended
October 31, 2003. In general, the Executive Committee may exercise such powers
of the Directors between meetings of the Directors as may be delegated to it by
the Directors (except for certain powers of the Directors which may not be
delegated). Messrs. Willing L. Biddle, Peter Herrick, Charles D. Urstadt and
Charles J. Urstadt are the current members of the Executive Committee.
The Nominating and Corporate Governance Committee was chartered after
the close of the fiscal year ended October 31, 2003 and accordingly did not meet
during that fiscal year. The Nominating and Corporate Governance Committee
consists of five non-employee Directors, each of whom is independent as defined
in the listing standards (as amended from time to time) of the New York Stock
Exchange. The principal responsibilities of the Nominating and Corporate
Governance Committee are to: (i) establish criteria for Board membership and
selection of new Directors; (ii) recommend nominees to stand for election to the
Board, including incumbent Board members and candidates for new Directors; (iii)
develop and recommend a set of corporate governance principles and evaluate
compliance by management and the Board with those principles and the Company's
Code of Business Conduct and Ethics; and (iv) with the assistance of the Chief
Executive Officer and other members of the Board, develop and periodically
review succession planning for the Chief Executive Officer.
Nominees for the Board are typically identified by non-management members of the
Board. The Committee will consider written recommendations from shareholders of
the Company regarding potential nominees for election as Directors and the
Committee does not intend to evaluate such nominees any differently than other
nominees to the Board. The Nominating and Corporate Governance Committee does
not have specific minimum qualifications for Committee-recommended Director
nominees. However, the Committee expects to adopt formal, specific objective
criteria prior to consideration of Director nominees for the 2005 Annual Meeting
of Shareholders. Consistent with past practice, the Board anticipates that
minimum criteria will include the following:
- a candidate's demonstrated integrity and ethics consistent with the
Company's Code of Business Conduct and Ethics;
- a candidate's willingness to represent the best interests of all of the
Company's shareholders and not just a particular constituency; and
- a candidate's willingness and ability to participate fully in Board
activities, including active membership and attendance at Board meetings
and participation in at least one committee of the Board.
6
The Board has not adopted a numerical limit on the number of public company
boards on which its Directors may serve; however, the Committee will consider
the demands on a candidate's time in selecting nominees. In addition, the
Committee will take into consideration such other factors as it deems
appropriate, including:
- the appropriate size and diversity of the Company's Board of Directors;
- the needs of the Company with respect to the particular talents and
experience of its Directors and the interplay of the candidate's
experience with that of other Board members;
- a candidate's judgment, skill and experience with businesses and
organizations comparable to the Company; and
- a candidate's experience in real estate, business, finance, accounting
rules and practices, law and public relations.
The Company requires that at least a majority of its Directors satisfy the
independence criteria established by the NYSE and any applicable SEC rules, as
they may be amended from time to time. In addition, the Committee will consider
the financial literacy and financial background of nominees to ensure that the
Board has at least one "audit committee financial expert" on the Audit Committee
and that Board members who might serve on the Audit Committee satisfy the
financial literacy requirements of the NYSE. The Committee believes it
appropriate for at least one key member of the Company's management to
participate as a member of the Board.
Shareholders can suggest qualified candidates for Director by writing to the
Company's corporate secretary at 321 Railroad Avenue, Greenwich, CT 06830.
Submissions timely received (as described under "Other Matters" on page 26) and
which comply with the criteria outlined in the preceding paragraphs will be
forwarded to the Chairperson of the Nominating and Corporate Governance
Committee for review and consideration.
Mr. Mueller is being nominated for election to the Board for the first time. Mr.
Mueller was initially brought to the attention of the Board of Directors by a
non-management Director prior to the formation and chartering of the Nominating
and Corporate Governance Committee. Mr. Mueller's nomination and the nomination
of three currently serving Directors was made by the Board, acting as a whole,
with Messrs. Biddle, C.D. Urstadt and C.J. Urstadt, being all of the
non-independent Directors, abstaining from the vote.
The Board of Directors has approved a written charter for the Nominating and
Corporate Governance Committee, the text of which may be viewed on the Company's
website at http:\\www.ubproperties.com. Messrs. E. Virgil Conway, Robert R.
Douglass, Peter Herrick, George H. C. Lawrence and George J. Vojta are the
current members of the Nominating and Corporate Governance Committee.
Section 16(a) Beneficial Ownership Reporting Compliance. Section 16(a)
of the Securities Exchange Act of 1934, as amended (the "Exchange Act"),
requires the Directors and officers, and persons who own more than 10% of a
registered class of the Company's equity securities, to file initial reports of
ownership and reports of changes in ownership of such equity securities with the
Securities and Exchange Commission ("SEC"). Such persons are also required by
SEC regulations to furnish the Company with copies of all Section 16(a) forms
they file. Based solely on a review of the copies of such forms furnished to the
Company, or written representations that no Forms 5 were required, the Company
believes that, with respect to the period from November 1, 2002 through October
31, 2003, its Directors, officers and greater than 10% beneficial owners
complied with all Section 16(a) filing requirements, except that a Form 4 filing
for Mr. Biddle, relating to the acquisition of 555 shares of Common Stock by Mr.
Biddle's wife and 1,070 shares of Common Stock by a trust for the benefit of the
issue of Mr. Biddle and for which Mr. Biddle is a co-trustee, was inadvertently
not filed, but was later reported in a Form 5 filing.
At the Annual Meeting, the stockholders of the Company will be
requested to elect four Directors, one belonging to Class II and three
comprising Class I. The affirmative vote of the holders of not less than a
majority of the total combined voting power of all classes of stock entitled to
vote and present, in person or by properly executed proxy, at the Annual
Meeting, subject to quorum requirements, will be required to elect a Director.
THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS A VOTE FOR
APPROVAL OF THE NOMINEES FOR ELECTION AS DIRECTORS.
7
PROPOSAL 2
RATIFICATION OF APPOINTMENT OF
INDEPENDENT AUDITORS OF THE COMPANY
Ernst & Young LLP, independent auditors, provided auditing and other
professional services to the Company during the fiscal year ended October 31,
2003.
The Audit Committee has, subject to ratification by
the stockholders of the Company, appointed Ernst & Young LLP to audit the
financial statements of the Company for the ensuing fiscal year and recommends
to the stockholders that such appointment be ratified. Representatives of Ernst
& Young LLP will be present at the Annual Meeting with the opportunity to make a
statement if they so desire. Such representatives will also be available to
respond to appropriate questions.
The affirmative vote of the holders of not less than a majority of the
total combined voting power of all classes of stock entitled to vote and
present, in person or by properly executed proxy, at the Annual Meeting, subject
to quorum requirements, will be required to ratify the appointment of Ernst &
Young LLP as independent auditors of the Company.
THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS A VOTE FOR
RATIFICATION OF THE APPOINTMENT OF ERNST & YOUNG LLP
AS INDEPENDENT AUDITORS OF THE COMPANY.
PROPOSAL 3
AMENDMENT OF THE DIVIDEND REINVESTMENT
AND SHARE PURCHASE PLAN
The Company first adopted the Dividend Reinvestment and Share Purchase Plan (the
"DRIP Plan") in 1982 and registered 500,000 shares of Common Stock for issuance
under the DRIP Plan. The principal purpose of the DRIP Plan is to provide all
holders of Class A Common Shares and Common Shares with a convenient and
economical way to purchase additional Class A Common Shares and Common Shares,
respectively, without the payment of brokerage commissions or service charges.
In 1994, the Board of Directors of the Company approved an increase in the
number of shares to be authorized under the DRIP Plan and registered an
additional 250,000 shares of Common Stock for issuance under the DRIP Plan.
Following the creation of the Class A Common Stock in 1998, the Board approved
and registered an additional 250,000 shares of Class A Common Stock for issuance
under the DRIP Plan.
As of January 5, 2004, there remained 143,534 Class A Common Shares and 81,627
Common Shares available for issuance under the DRIP Plan.
As a result of two public offerings of additional Class A Common Shares within
the last two years as well as increased demand for participation in the DRIP
Plan by holders of Common Shares, the Board of Directors has approved an
amendment to the DRIP Plan, subject to approval of the stockholders, to increase
the number of shares registered for issuance under the DRIP Plan by an
additional 400,000 shares each of Class A Common Shares and Common Shares.
Set forth below is a summary of the principal provisions of the DRIP Plan.
Summary of the Dividend Reinvestment and Share Purchase Plan
Reinvestment of Dividends. Participants may reinvest cash dividends on all Class
A Common Shares or Common Shares registered in their names in additional Class A
Common Shares or Common Shares, respectively. Participants also may reinvest
cash dividends on less than all Class A Common Shares and Common Shares
registered in their names in additional Class A Common Shares and Common Shares,
respectively, and continue to receive cash dividends on the remaining Class A
Common Shares and Common Shares. The reinvestment of dividends is made on the
date when the dividend becomes payable. Participants become owners of Class A
Common Shares or Common Shares purchased under the DRIP Plan as of the date of
purchase. The price of Class A Common Shares or Common Shares purchased from the
Company with participants' reinvested cash dividends (the "Purchase Price") is
determined by the higher of (x) 95% of the closing price of the Class A Common
Shares or Common Shares, as applicable, on the dividend payment date or (y) 100%
of the average of the daily high and low sales prices of the Class A Common
Shares or Common Shares, as applicable, for the period of five trading days
ending on the dividend payment date (in each case as reported on the New York
Stock Exchange Composite Tape). If
8
there is no trading in the Class A Common Shares or the Common Shares on the
NYSE for a substantial amount of time during any trading day in the five-day
period, or if reporting on the New York Stock Exchange Composite Tape is subject
to reporting error, the applicable Purchase Price will be determined by the
Company on the basis of such market quotations as the Company and the agent who
administers the DRIP Plan deem appropriate. Should daily high and low prices of
the Class A Common Shares or Common Shares no longer be reported for the New
York Stock Exchange-Composite Transactions, then the Company, upon consultation
with the Agent, will identify such other public reports or sources as the
Company deems appropriate to obtain daily trading prices of its Class A Common
Shares and Common Shares. Holders of Class A Common Shares and Common Shares who
do not choose to participate in the DRIP Plan continue to receive cash
dividends, as declared.
Source of Class A Common Shares and Common Shares and Use of Funds. Class A
Common Shares and Common Shares purchased under the DRIP Plan come from
authorized, but unissued Class A Common Shares and Common Shares of the Company.
Class A Common Shares and Common Shares will not be purchased in the open
market. Since shares are purchased from the Company, the Company will receive
additional funds to make investments in real estate and for other purposes.
Administration of the DRIP Plan. The Bank of New York (the "Agent") administers
the DRIP Plan for participants, keeps records, sends statements of account to
participants after each purchase and performs other duties relating to the DRIP
Plan. The Agent purchases Class A Common Shares or Common Shares from the
Company, as agent for the participants in the DRIP Plan and credits the shares
to the accounts of the individual participants. All costs of administration of
the DRIP Plan are paid by the Company. There are no brokerage fees for purchase
of Class A Common Shares or Common Shares because shares are purchased directly
from the Company. However, if a participant requests the Agent to sell shares in
the event of the participant's withdrawal from the DRIP Plan, the Agent deducts
any brokerage commissions and transfer taxes incurred. Also, brokers and
nominees may impose charges or fees in connection with their handling of
participation in the DRIP Plan by nominee and fiduciary accounts.
Federal Income Tax Consequences. For U.S. federal income tax purposes,
distributions paid by the Company which are reinvested in additional Class A
Common Shares or Common Shares are treated in the same manner as normal cash
distributions. Distributions that are designated as capital gain dividends are
taxable as long-term capital gain to the extent of the Company's net capital
gain for the year, regardless of how long the participant has held the
underlying shares. Distributions other than capital gain dividends generally are
taxable as ordinary income to the extent of the Company's current and
accumulated earnings and profits. If the Company makes distributions in excess
of its current and accumulated earnings and profits, such distributions
constitute nontaxable returns of capital to the extent of the participant's tax
basis in the shares with respect to which the distributions are paid, and
taxable gain to the extent of any excess. The participant's tax basis in shares
generally will equal the amount that the participant paid for such shares.
Participants will recognize gain or loss upon a sale, redemption or other
taxable disposition of Class A Common Shares or Common Shares, such as when
shares are sold either by the participant or by the Agent at the participant's
request when the participant withdraws from the DRIP Plan or when the
participant receives a cash payment for a fractional share credited to the
participant's account upon withdrawal from or termination of the DRIP Plan. Such
gain or loss generally is measured by the difference between the amount realized
on the taxable disposition of the shares and the participant's basis in such
shares. In general, capital gain realized by a U.S. individual, estate or trust
on a taxable disposition of Class A Common Shares or Common Shares that are held
(i) for one year or less will be treated as short-term capital gain taxable at
ordinary income rates, or (ii) for more than one year will be subject to a
maximum tax rate of 15 percent. For corporations, capital gains are generally
taxed at the same rate as ordinary income.
In general, capital losses realized by a corporate holder of Class A Common or
Common Shares on a taxable disposition of Class A Common or Common Shares are
deductible only against capital gains. A noncorporate holder of Class A Common
or Common Shares (i.e., an individual, estate or trust) is subject to a similar
rule, except that he or she may deduct up to $3,000 of excess capital losses
against ordinary income each year. The net capital losses of a corporate holder
of Class A Common or Common Shares not allowed in the year realized generally
may be carried back three years and carried forward five years from the loss
year. The capital losses of a noncorporate holder of Class A Common or Common
Shares may not be carried back, but such losses may be carried forward
indefinitely.
9
The summary above discusses only U.S. Federal income tax considerations relating
to the ownership of Class A Common or Common Shares and participation in the
DRIP Plan. This summary is based on the provisions of the Internal Revenue Code
of 1986, as amended, and regulations, rulings and judicial decisions thereunder,
as in effect on the date hereof. In particular, this summary does not address
the tax treatment of holders of Class A Common or Common Shares who are subject
to special tax rules, including, without limitation, dealers in securities,
insurance companies, banks, tax-exempt entities or qualified pension and
profit-sharing plans. Holders of Class A Common or Common Shares are advised to
consult their own tax advisers as to the U.S., state, local and other tax
consequences of the ownership of Class A Common or Common Shares and
participation in the DRIP Plan.
The affirmative vote of the holders of not less than a majority of the total
combined voting power of all classes of stock entitled to vote and present, in
person or by properly executed proxy, at the Annual Meeting, subject to quorum
requirements, will be required to amend the DRIP Plan.
THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS A VOTE FOR
THE AMENDMENT OF THE DIVIDEND REINVESTMENT AND SHARE PURCHASE PLAN
PROPOSAL 4
AMENDMENT OF THE RESTRICTED STOCK AWARD PLAN
In 2002, the shareholders of the Company approved an Amended and
Restated Restricted Stock Award Plan (the "Plan") which amended and restated the
Company's Restricted Stock Award Plan originally adopted in 1997 and amended in
2000. The principal purpose of the Plan is to promote the long-term growth of
the Company by attracting, retaining and motivating directors and key management
personnel possessing outstanding ability and to further the identity of the
interests of such personnel with those of the Company's stockholders through
stock ownership opportunities. Pursuant to the Plan, directors and management
personnel of the Company, selected by the Compensation Committee, may be issued
restricted stock awards.
As of January 5, 2004, awards representing 301,125 shares of Class A
Common Stock and 685,000 shares of Common Stock had been issued under the Plan
and there remained 48,875 shares of Class A Common Stock and 15,000 shares
which, at the discretion of the Compensation Committee, may be awarded in any
combination of Class A Common Stock and Common Stock, available for future
awards.
In order to be able to continue to attract, retain and motivate
qualified individuals as directors and officers of the Company, the Board of
Directors has approved, subject to stockholder approval, an amendment to the
Plan that would increase the maximum number of shares of restricted stock
available for issuance thereunder from 1,050,000 common shares (350,000 shares
each of Class A Common Stock and Common Stock and 350,000 shares which, at the
discretion of the Compensation Committee administering the Plan, may be awarded
in any combination of Class A Common Stock or Common Stock) to 1,650,000 common
shares, of which 350,000 shares shall be Class A Common Stock, 350,000 shares
shall be Common Stock and 950,000 shares, at the discretion of the Compensation
Committee administering the Plan, shall be any combination of Class A Common
Stock or Common Stock.
Set forth below is a summary of the principal provisions of the Plan.
Summary of the Restricted Stock Award Plan
Grant of Restricted Stock Awards. If Proposal 4 is approved, the Compensation
Committee would be authorized to grant restricted stock awards up to 1,650,000
common shares (350,000 shares each of Class A Common Stock and Common Stock and
950,000 shares which, at the discretion of the Compensation Committee, may be
awarded in any combination of Class A Common Stock or Common Stock). The
participants eligible to receive the restricted stock awards are management
personnel selected by the Compensation Committee, in its discretion, who are
considered to have significant responsibility for the growth and profitability
of the Company as well as Directors.
10
Principal Terms and Conditions of Restricted Stock Awards. Each restricted stock
award will be evidenced by a written agreement, executed by both the relevant
participant and the Company, setting forth all the terms and conditions
applicable to such award as determined by the Compensation Committee. Such terms
and conditions shall include (i) the length of the restricted period of the
award; (ii) the restrictions applicable to the award, including without
limitation the employment or retirement status rules governing forfeiture, and
the prohibition against the sale, assignment, transfer, pledge or other
encumbrance of the restricted stock during the restricted period; and (iii) the
eligibility to share in dividends and other distributions paid to the Company's
shareholders during the restricted period.
Lapse of Restrictions. If a participant's status as an employee or non-employee
Director of the Company is terminated by reason of death or disability, the
restrictions shall lapse on such date. If such status as an employee or
non-employee Director is terminated prior to the lapse of the restricted period
by reason of retirement, the restricted period will continue as if the
participant had remained in the employment of the Company. The Compensation
Committee has the authority to accelerate the time at which the restrictions may
lapse whenever it considers that such action is in the best interests of the
Company and of its stockholders, whether by reason of changes in tax laws, a
"change in control" as defined in the Plan or otherwise.
Tax Consequences. The Company is required to withhold taxes to comply with
federal and state laws applicable to the value of restricted shares when they
are released from risk of forfeiture. Upon the lapse of the applicable
restrictions, the value of the restricted stock will be taxable to the relevant
participant as ordinary income and deductible by the Company.
Compliance with SEC Requirements. No certificates for shares distributed under
the terms of the Plan shall be executed and delivered to participants until the
Company shall have taken any action then required to comply with the Securities
Act of 1933, as amended, the Exchange Act and applicable SEC requirements.
Adjustments to the Plan. If the Company subdivides or combines its outstanding
shares of Class A Common Stock or Common Stock into a greater or lesser number
of shares or if the Compensation Committee shall determine that a stock
dividend, reclassification, business combination, exchange of shares, warrants
or rights offering to purchase shares or other similar event affects the shares
of the Company such that an adjustment is required in order to preserve the
benefits or potential benefits intended to be made available under the Plan, the
Compensation Committee may make adjustments to the number and class of shares
which may be awarded and the number and class of shares subject to outstanding
awards under the Plan.
The affirmative vote of the holders of not less than a majority of the total
combined voting power of all classes of stock entitled to vote and present, in
person or by properly executed proxy, at the Annual Meeting, subject to quorum
requirements, will be required to amend the Restricted Stock Award Plan.
THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS A VOTE
FOR THE AMENDMENT OF THE RESTRICTED STOCK AWARD PLAN
11
Security Ownership of Certain Beneficial Owners and Management
The following tables set forth certain information as of January 5, 2004
available to the Company with respect to the shares of the Company (i) held by
those persons known to the Company to be the beneficial owners (as determined
under the rules of the SEC) of more than 5% of the Class A Common Shares and
Common Shares then outstanding and (ii) held by each of the Directors, each of
the executive officers named in the Summary Compensation Table below, and by all
of the Directors and such executive officers as a group:
5% BENEFICIAL OWNERS
Common Shares Class A Common
Name and Address of Beneficially Percent of Shares Beneficially Percent of
Beneficial Owner Owned Class Owned Owned
------------------- -------------- ---------- ------------------- ----------
Charles J. Urstadt 2,537,463 (1) 36.0% 296,100 (2) 1.6%
Urstadt Biddle Properties Inc.
321 Railroad Ave.
Greenwich, CT 06830
Willing L. Biddle 1,032,041 (3) 14.6% 149,230 (4) 0.8%
Urstadt Biddle Properties Inc.
321 Railroad Ave.
Greenwich, CT 06830
Grace & White, Inc. 391,300 (5) 5.6% 572,900 (5) 3.1%
515 Madison Ave., Suite 1700
New York, NY 10022
---------------
(1) Of these shares, 387,597 are owned by Urstadt Property Company, Inc.
("UPCO"), a company of which Mr. Urstadt is the chairman, a director
and a principal stockholder, 1,753,950 shares are owned by Urstadt
Realty Associates Co LP ("URACO"), a Delaware limited partnership of
which UPCO is the general partner and Mr. Urstadt, Elinor Urstadt (Mr.
Urstadt's wife), the Catherine U. Biddle Irrevocable Trust and the
Charles D. Urstadt Irrevocable Trust (for each of which trusts Mr.
Urstadt is the sole trustee) are the limited partners, 7,000 shares are
owned by Elinor Urstadt, 6,866 shares are held by The Trust Established
Under the Urstadt Biddle Properties Inc. Excess Benefit and Deferred
Compensation Plan (the "Compensation Plan Trust") and 100,000 shares
are owned by the Urstadt Conservation Foundation (the "Conservation
Foundation"), of which Mr. Urstadt and his wife, Elinor Urstadt, are
the sole trustees. Mr. Urstadt disclaims beneficial ownership of any
shares held by the Conservation Foundation. See "Compensation and
Transactions with Management and Others" below.
(2) Of these shares, 165,550 shares are owned by URACO and 34,050 shares
are owned by Elinor Urstadt, Mr. Urstadt's wife. See "Compensation and
Transactions with Management and Others" below.
(3) Of these shares, 2,472 shares are held by the Compensation Plan Trust,
2,130 shares are owned by the Willing L. Biddle IRA, 4,475 shares are
owned beneficially and of record by Catherine U. Biddle, Mr. Biddle's
wife, 555 shares are owned by the Catherine U. Biddle IRA and 1,070
shares are owned by the Charles and Phoebe Biddle Trust UAD 12/20/93,
of which Mr. Biddle and Charles J. Urstadt are the sole trustees, for
the benefit of the issue of Mr. Biddle.
(4) Of these shares, 4,475 shares are owned beneficially and of record
by Catherine U. Biddle and 555 shares are owned by the Catherine U.
Biddle IRA.
(5) Based upon information filed on Form 13F with the SEC by Grace &
White, Inc. for the period ended December 31, 2003.
12
DIRECTORS AND OFFICERS
Common Class A
Shares Beneficially Percent Common Shares Percent
Name Owned (1) of Class (1) Beneficially Owned (2) of Class (2)
---- --------- ------------ ---------------------- ------------
Charles J. Urstadt 2,537,463 (3) 36.0% 296,100 (4) 1.6%
Willing L. Biddle 1,032,041 (5) 14.6% 149,230 (6) *
E. Virgil Conway 7,625 * 74,596 (7) *
Robert R. Douglass 11,157 (8) * 30,243 (9) *
Peter Herrick 33,955 (10) * 55,049 (11) *
George H.C. Lawrence 32,423 (12) * 36,284 (13) *
Charles D. Urstadt 17,316 (14) * 3,153 (15) *
George J. Vojta 8,525 * 4,025 *
James R. Moore 43,516 (16) * 138,839 (17) *
Raymond P. Argila 15,566 (18) * 83,266 (19) *
Directors & Executive Officers
as a group (10 persons) 3,739,587 (20) 53.1% 870,785 (21) 4.7%
--------
*Less than 1%
(1) On August 14, 1998, the Company paid a stock dividend in the form of one
share of Class A Common Stock for each outstanding share of Common Stock (the
"Stock Dividend"). In connection with the Stock Dividend, each of the directors'
options to purchase shares of Common Stock awarded prior to the Stock Dividend
(each an "Existing Option") is deemed to be, upon his election with respect to
each Existing Option: (i) an option (each, a "Common Stock Option") to purchase
such number of shares of Common Stock as shall be equal in aggregate fair market
value to the aggregate fair market value of the shares of Common Stock issuable
pursuant to the related Existing Option; (ii) an option (each, a "Class A Stock
Option") to purchase such number of shares of Class A Common Stock as shall be
equal in aggregate fair market value to the aggregate fair market value of the
shares of Common Stock issuable pursuant to the related Existing Option; or
(iii) an option (each, a "Combination Option") to purchase such number of shares
of Common Stock and such number of shares of Class A Common Stock, in each case,
as shall be equal to the number of shares of Common Stock issuable pursuant to
the related Existing Option.
The exercise price for the purchase of one share of Common Stock and/or
one share of Class A Common Stock pursuant to any Common Stock Option, Class A
Stock Option or Combination Option has been set according to the proportional
allocation of the exercise price for the purchase of one share of Common Stock
pursuant to the related Existing Option, such proportional allocation being
determined according to the fair market values of the underlying shares of
Common Stock (ex-Stock Dividend) and Class A Common Stock.
The figures presented in this column (except for those relating to Charles
J. Urstadt, Willing L. Biddle, James R. Moore and Raymond P. Argila) assume, in
connection with the determination of the number of Common Shares issuable upon
exercise of options exercisable within 60 days by the respective individuals
listed below, that such individuals will elect the Common Stock Option with
respect to all of such options. If any such individual elects the Combination
Option or the Class A Stock Option with respect to any or all of such options,
the number of Common Shares issuable upon exercise of options exercisable within
60 days, the total number of Common Shares beneficially owned and the Percent of
Class would be less for such individual.
(2) The figures presented in this column (except for those relating to Charles
J. Urstadt, Willing L. Biddle, James R. Moore and Raymond P. Argila) assume, in
connection with the determination of the number of Class A Common Shares
issuable upon exercise of options exercisable within 60 days by the respective
individuals listed below, that such individuals will elect the Class A Stock
Option with respect to all of such options. If any such individual elects the
Combination Option or the Common Stock Option with respect to any or all of such
options, the number of Class A Common Shares issuable upon exercise of options
exercisable within 60 days, the total number of Class A Common Shares
beneficially owned and the Percent of Class would be less for such individual.
(3) See note (1) under the preceding table titled "5% Beneficial Owners".
13
(4) See note (2) under the preceding table titled "5% Beneficial Owners".
(5) See note (3) under the preceding table titled "5% Beneficial Owners".
(6) See note (4) under the preceding table titled "5% Beneficial Owners".
(7) This figure includes 10,000 Class A Common Shares held of record by The
Conway Foundation of which Mr. Conway and his wife, Elaine Conway, are the sole
directors. Mr. Conway disclaims beneficial ownership of any shares held by The
Conway Foundation.
(8) This figure includes 4,932 Common Shares issuable upon exercise of options
which are currently exercisable or which will become exercisable within 60 days.
See footnote (1) above.
(9) This figure includes 4,906 Class A Common Shares issuable upon exercise of
options which are currently exercisable or which will become exercisable within
60 days. See footnote (1) above.
(10) This figure includes 10,830 Common Shares issuable upon exercise of options
which are currently exercisable or which will become exercisable within 60 days.
See footnote (1) above.
(11) This figure includes 10,765 Class A Common Shares issuable upon exercise of
options which are currently exercisable or which will become exercisable within
60 days. See footnote (1) above.
(12) This figure includes 6,898 Common Shares issuable upon exercise of options
which are currently exercisable or which will become exercisable within 60 days.
See footnote (1) above.
(13) This figure includes 6,859 Class A Common Shares issuable upon exercise of
options which are currently exercisable or which will become exercisable within
60 days. See footnote (1) above.
(14) This figure includes 2,966 Common Shares issuable upon exercise of options
which are currently exercisable or which will become exercisable within 60 days.
See footnote (1) above.
(15) This figure includes 2,953 Class A Common Shares issuable upon exercise of
options which are currently exercisable or which will become exercisable within
60 days. See footnote (1) above.
(16) This figure includes 19,000 Common Shares issuable upon exercise of options
which are currently exercisable or which will become exercisable within 60 days.
(17) This figure includes 13,423 Class A Common shares held of record by the
Compensation Plan Trust.
(18) This figure includes 9,000 Common Shares issuable upon exercise of options
which are currently exercisable or which will become exercisable within 60 days.
(19) This figure includes 15,000 Class A Common Shares issuable upon exercise of
options which are currently exercisable or which will become exercisable within
60 days.
(20) This figure includes 53,626 Common Shares issuable upon exercise of options
which are currently exercisable or which will become exercisable within 60 days.
(21) This figure includes 40,483 Class A Common Shares issuable upon exercise of
options which are currently exercisable or which will become exercisable within
60 days.
14
COMPENSATION AND TRANSACTIONS WITH MANAGEMENT AND OTHERS
Executive Officer Compensation
There is set forth below information concerning the annual and long-term
compensation paid by the Company during each of the three years ended October
31, 2003 to those persons who were, at October 31, 2003 (i) the chief executive
officer and (ii) the three other most highly compensated executive officers of
the Company constituting the only persons who were serving as executive officers
at such date.
SUMMARY COMPENSATION TABLE
LONG TERM COMPENSATION
-----------------------
ANNUAL COMPENSATION AWARDS PAYOUTS
------------------- ------ -------
#
Name and Principal Restricted Options LTIP All Other
Position Year Salary Bonus Total Stock (1) SARs Payouts $ Compensation (2)
-------- ---- ------ ----- ----- --------- ---- --------- ----------------
Charles J. Urstadt 2003 $286,650 $30,000 $316,650 $882,500 0 0 $15,832
Chairman and Chief 2002 $279,167 $30,000 $309,167 $619,500 0 0 $15,458
Executive Officer 2001 $274,167 $30,000 $304,167 $214,695 0 0 $15,208
Willing L. Biddle 2003 $250,819 $30,000 $280,819 $1,261,875 0 0 $14,041
President and Chief 2002 $236,667 $30,000 $266,667 $619,500 0 0 $13,333
Operating Officer 2001 $218,333 $27,500 $245,833 $286,260 0 0 $12,292
James R. Moore 2003 $209,990 $20,000 $229,990 $171,000 0 0 $11,500
Executive Vice President 2002 $198,167 $20,000 $218,167 $120,600 0 0 $10,908
and Chief Financial 2001 $187,500 $18,000 $205,500 $78,722 0 0 $10,275
Officer
Raymond P. Argila 2003 $158,089 $27,000 $185,089 $45,600 0 0 $8,279
Senior Vice President 2002 $151,740 $10,000 $161,740 $40,200 0 0 $8,087
and Chief Legal Officer 2001 $149,389 $5,000 $154,389 $28,626 0 0 $7,720
----------------
(1) Amounts shown represent the dollar value on the date of grant. The aggregate
number of shares of restricted stock held on October 31, 2003 and the value
thereof as of such date were as follows: Urstadt, 90,000 Class A Common Shares
and 200,000 Common Shares ($3,859,500); Biddle, 106,250 Class A Common Shares
and 243,750 Common Shares ($4,657,188); Moore, 48,500 Class A Common Shares and
21,500 Common Shares ($940,975); and Argila, 14,000 Class A Common Shares and
6,000 Common Shares ($268,900). Restricted stock vests between five and ten
years after the date of grant, as determined by the Compensation Committee at
the time of each grant. Dividends on shares of restricted stock are paid as
declared. During the year ended October 31, 2003, Mr. Moore became fully vested
in 5,750 shares each of Class A Common Stock and Common Stock that were granted
as restricted stock in 1998. Mr. Argila became fully vested in 2,500 shares each
of Class A Common Stock and Common Stock that were granted as restricted stock
in 1998.
(2) Consists of a discretionary contribution by the Company to the Company's
Profit Sharing and Savings Plan (the "401(k) Plan") allocated to an account of
the named executive officer and related excess benefit compensation.
15
Director Compensation
Other than Messrs. C.J. Urstadt and Biddle, each Director is entitled to an
annual retainer of $18,000 and compensation of $1,500 for each Director meeting
and each committee meeting attended. The chairmen of the Audit Committee,
Compensation Committee and the Nominating and Corporate Governance Committee
each are entitled to an additional annual retainer of $3,000.
Excess Benefits and Deferred Compensation Plan
Effective November 1, 1996, the Directors adopted the Urstadt Biddle
Properties Inc. Excess Benefit and Deferred Compensation Plan, a non-qualified
deferred compensation plan. The Plan is intended to provide eligible employees
with benefits in excess of the amounts which may be provided under the Company's
tax-qualified Profit Sharing and Savings Plan (a 401(K) plan), and to provide
such employees with the opportunity to defer receipt of a portion of their
compensation. Participation is limited to those employees who earn above the
limit on compensation under the Company's Profit Sharing and Savings Plan,
currently $200,000.
Under the Plan, a participant is credited with an amount equal to the
contributions which would have been credited to the participant if the $200,000
compensation limitation under the Profit Sharing and Savings Plan did not apply.
Amounts credited under the Plan vest under the same rules as under the
Profit Sharing and Savings Plan. In addition, each Participant may elect to
defer the receipt of a portion of his or her compensation until a later date.
Amounts credited under the Plan are increased with interest at a rate set from
time to time by the Compensation Committee. For the fiscal year ended October
31, 2003, the Company paid interest on deferred compensation accounts at a rate
based upon the rate of interest applicable to United States Ten Year Treasury
Notes plus two percent. In the event of a change of control (as defined in the
Plan), the Compensation Committee may in its discretion accelerate the vesting
of benefits under the Plan.
Effective as of January 1, 2000, the Excess Benefit and Deferred
Compensation Plan was amended by creating a trust to hold funds allocated under
the Plan. Members of the Compensation Committee act as trustees of the trust.
Eligible participants in the Plan may elect to have all or a portion of their
deferred compensation accounts in the Plan invested in the Company's Class A
Common Stock, Common Stock or such other securities as may be purchased by the
trustees in their discretion.
Change of Control Agreements
The Company has agreements with each of its executive officers, including
Messrs. Urstadt, Biddle, Moore and Argila, under which, in certain circumstances
following a Change of Control of the Company (as defined in such agreements),
the Company would pay severance benefits to such persons. If, within 18 months
following the Change of Control, the Company terminates the executive's
employment other than for cause, or if the executive elects to terminate his
employment with the Company for reasons specified in the agreement, the Company
will make a severance payment equal to a portion of such person's base salary,
together with medical and other benefits during such period. Messrs. Urstadt,
Biddle, Moore and Argila would each receive a severance payment equal to their
respective twelve month salaries plus benefits. The salaries of Messrs. Urstadt,
Biddle, Moore and Argila are currently $290,000, $260,000, $220,000 and
$165,000, respectively. Each of such agreements has an indefinite term.
Stock Options
The Company maintains a Stock Option Plan pursuant to which 824,093 shares
of the Company's authorized but unissued Common Shares and 743,003 shares of the
Company's Class A Common Shares have been reserved for issuance upon the
exercise of options which have been or may be granted under the Plan. The
persons eligible to participate in the Plan are such key employees of the
Company as may be selected from time to time by the Compensation Committee in
its discretion, as well as non-employee Directors. The Plan is administered by
the Compensation Committee.
There were no grants of stock options made under the Stock Option Plan in
the fiscal year ended October 31, 2003.
16
Prior to enactment of the Sarbanes-Oxley Act of 2002, the Compensation
Committee authorized loans to finance the exercise of stock options granted to
executive officers. One loan is outstanding to Willing L. Biddle in the
principal amount of $1,300,000. The loan has a ten-year term, subject to
extension at the discretion of the Compensation Committee, bears interest at a
fixed rate based upon the rate of interest applicable to United States Ten Year
Treasury Notes plus two percent and is secured by a pledge of the related
shares. The loan becomes due on termination of employment by the Company, but is
automatically extended for seven months following termination of employment
other than for cause.
The following table sets forth, for the executive officers named in the
Summary Compensation Table, information concerning the fiscal year-end value of
unexercised options and SARs.
Aggregated Options/SAR Exercises in Last Fiscal Year and
FY-End Option/SAR Values
# of Unexercised Value of Unexercised
Class A Common In-the-Money
And Common Share Options/SARs at
Shares Options/SARs at FY-End FY-End ($)
Acquired On Value
Names Exercise (#) Realized ($) Exercisable Unexercisable Exercisable Unexercisable
----- ------------ ----------- ----------- ------------- ----------- -------------
Charles J. Urstadt
Class A -- -- -- -- -- --
Common -- -- -- -- -- --
Willing L. Biddle
Class A -- -- -- -- -- --
Common -- -- -- -- -- --
James R. Moore
Class A 5,500 $ 28,387 -- -- -- --
Common 2,500 $ 12,654 19,000 -- $113,520 --
Raymond P. Argila
Class A 5,000 $ 26,781 15,000 -- $ 94,693 --
Common 11,000 $ 55,024 9,000 -- $ 54,333 --
17
Restricted Stock Plan
Under the Company's Restricted Stock Award Plan (the "Plan"), 350,000
shares each of the Company's authorized but unissued Class A Common Shares and
Common Shares and 350,000 shares, which at the discretion of the Compensation
Committee may be awarded in any combination of Class A Common Shares and Common
Shares, have been reserved for issuance in connection with restricted stock
awards that have been or may be granted under the Plan. The persons eligible to
receive restricted stock awards are selected by the Compensation Committee, in
its discretion, from among management personnel who are considered to have
significant responsibility for the growth and profitability of the Company and
non-employee Directors. The Plan is administered by the Compensation Committee.
Each restricted stock award is evidenced by a written agreement,
executed by both the relevant participant and the Company, setting forth all the
terms and conditions applicable to such award as determined by the Compensation
Committee. Such terms and conditions shall include (i) the length of the
restricted period of the award, (ii) the restrictions applicable to the award,
including (without limitation) the employment or directorship status rules
governing forfeiture and restrictions on the sale, assignment, transfer, pledge
or other encumbrance of the restricted stock during the restricted period, and
(iii) the eligibility to share in dividends and other distributions paid to the
Company's stockholders during the restricted period.
If a participant ceases to be employed or ceases to be a director prior
to the lapse of the restricted period by reason of death or disability, the
restrictions shall lapse on such date. If a participant ceases to be employed or
ceases to be a director by reason of Retirement (as defined in the Plan), all
awards of restricted stock continue to vest as if Retirement had not occurred
until such time as the restrictions lapse.
The Compensation Committee has the authority to accelerate the time at
which the restrictions may lapse whenever it considers that such action is in
the best interests of the Company and of its stockholders, whether by reason of
changes in tax laws, a "change in control" (as defined in the Plan), or
otherwise.
As set forth under "Proposal 4 - Amendment of the Restricted Stock
Award Plan", the Board of Directors has approved, subject to approval of the
stockholders of the Company, an amendment to the Plan which would increase the
number of shares available for issuance under the Plan to 1,650,000 common
shares, of which 350,000 shares shall be Class A Common Stock, 350,000 shares
shall be Common Stock and 950,000 shares, at the discretion of the Compensation
Committee administering the Plan, shall be any combination of Class A Common
Stock or Common Stock.
18
Equity Compensation Plan Information
The Company has two compensation plans under which equity securities have been
authorized for issuance and have been issued to employees and non-employee
Directors; the Restricted Stock Award Plan and the Stock Option Plan. Each of
these plans has been approved by the Company's shareholders. For a description
of the Restricted Stock Award Plan, see Proposal 4 at page 10 and also page 18
in this proxy statement. For a description of the Stock Option Plan, see page
16.
The following table shows for these plans as a group the number of Class
A Common Shares and Common Shares to be issued upon exercise of options
outstanding at October 31, 2003, the weighted average exercise price of these
options and the number of Class A Common Shares and Common Shares remaining
available for future issuance at October 31, 2003, excluding shares to be issued
upon exercise of outstanding options.
Equity Compensation Plan Table
----------------------------- -------------------------- --------------------------- --------------------------
(a) (b) (c)
----------------------------- -------------------------- --------------------------- --------------------------
Plan category Number of Weighted- Number of Securities
Securities to be Average Exercise Remaining Available for
Issued Upon Price of Future Issuance Under
Exercise of Outstanding Equity Compensation
Outstanding Options, Warrants Plans (Excluding
Options, Warrants and Rights Securities Reflected in
and Rights Column (a))
----------------------------- -------------------------- --------------------------- --------------------------
Equity 42,733 (1) (4) $7.83 (1) 107,500 (1)
Compensation
plans approved 55,876 (2) (5) $7.62 (2) 2,406 (2)
by security
holders 190,500 (3)
----------------------------- -------------------------- --------------------------- --------------------------
Total 42,733 (1) (4) $7.83 (1) 107,500 (1)
55,876 (2) (5) $7.62 (2) 2,406 (2)
190,500 (3)
----------------------------- -------------------------- --------------------------- --------------------------
The Company has no equity compensation plans which are not approved by the
stockholders.
(1) Class A Common Shares
(2) Common Shares
(3) Either Common or Class A Common Shares
(4)As more fully described in footnote (1) to the table titled "Directors and
Officers" under the caption "Security Ownership of Certain Beneficial Owners and
Management", the figure presented assumes, in connection with 21,483 Class A
Common Shares to be issued upon exercise of outstanding options, that all
individuals for whom an election has been granted will elect the Class A Stock
Option. If any individual elects the Combination Option or the Common Stock
Option with respect to any or all of such options, the total number of Class A
Common Shares to be issued would be less.
(5) As more fully described in footnote (1) to the table titled "Directors and
Officers" under the caption "Security Ownership of Certain Beneficial Owners and
Management", the figure presented assumes, in connection with 21,626 Common
Shares to be issued upon exercise of outstanding options, that all individuals
for whom an election has been granted will elect the Common Stock Option. If any
individual elects the Combination Option or the Class A Stock Option with
respect to any or all of such options, the total number of Common Shares to be
issued would be less.
19
Report of Compensation Committee on Executive Compensation
Overview
The Compensation Committee of the Board of Directors is composed of three
independent, non-employee Directors, none of whom have interlocking
relationships as defined by the SEC. The Committee is responsible for approving
the Company's overall compensation strategy, determining the compensation
package for the Chief Executive Officer, including base salary, cash bonus and
long-term compensation and for administering the Company's Stock Option Plan and
Restricted Stock Plan. The Committee believes that compensation should be
structured to attract and retain high quality executives, with an emphasis on
long-term incentive compensation that is related to the performance and
profitability of the Company. Thus, in making its recommendations regarding
compensation, the Committee attempts to align the financial interests of the
Company's executive officers with those of its shareholders.
Executive Compensation
The Chief Executive Officer makes recommendations to the Compensation
Committee, based on the Company's performance evaluation procedures, concerning
the compensation to be paid to the executive officers of the Company other than
himself. The Committee retains final authority to approve any such compensation.
During the year ended October 31, 2003, the principal components of compensation
paid to the Company's executive officers included base salary, cash bonus
awards, long-term incentive compensation consisting of restricted stock awarded
under the Company's Restricted Stock Plan and other benefits such as health
insurance.
In approving compensation for executive officers, the Committee evaluated
the potential long-term profitability of the Company by considering a variety of
factors and criteria including stock price, projected and actual cash flow,
leasing activities, new acquisitions and other factors. The Committee examined
competitive compensation information for executive positions of comparable
responsibility with similarly sized REITs which the Committee believes are
representative of the companies against which the Company competes for executive
talent. These companies may not be identical to the NAREIT peer group included
in the performance graph in this proxy statement. The total direct compensation
(base salary plus annual cash bonuses and long-term incentives) paid to
executive officers was aimed at between the 50th and 75th percentiles. By
targeting base salaries close to the 25th percentile, the emphasis is on
long-term incentive compensation using the Restricted Stock Plan and Stock
Option Plan, thus providing the Company's key executives with a direct incentive
to improve the Company's performance and enhance shareholder value. The
Restricted Stock Plan provides that the recipient does not become vested in
restricted stock until after a specified time after it is issued. The
Compensation Committee determines the vesting period which may range between
five and ten years after the date of grant. Unless an exception is approved by
the Compensation Committee, if the executive leaves the Company other than by
retirement, death or disability, unvested stock is forfeited. Restricted stock
awards serve as both a reward for performance and a retention device for key
executives and help to align their interests with all shareholders.
For the year ended October 31, 2003, the Compensation Committee recognized
that the performance of the Company (as determined from such measures as growth
in net income, asset size and total return to stockholders) met or exceeded the
Board's expectations and ranked very favorably when compared against other
companies engaged in the same or similar business.
CEO Compensation
The Compensation Committee believes that the Chief Executive Officer's
demonstrated leadership abilities and his continued commitment to the Company's
principal objectives, including new acquisitions, the sale of non-core assets,
capital financing, leasing and cost containment, in the face of a changing
retail environment have positioned the Company for potential long-term
profitability and are deserving of special recognition. The Committee considered
the Chief Executive Officer's successful execution of strategic transactions,
noting the private offering of 400,000 shares of a new Series C preferred stock.
The Committee recommended to the Board of Directors and the Board of Directors
approved an increase in Mr. Urstadt's annual salary from $285,000 to $290,000
and awarded him a cash bonus of $30,000. The Committee also awarded Mr. Urstadt
restricted stock in the amount of 81,250 Common Shares and 6,250 Class A Common
Shares under the Restricted Stock Plan.
20
Other Compensation
The Compensation Committee believes that the leadership of Mr. Biddle
during fiscal 2003 in all areas of operations, including particularly new
acquisitions and increased leasing, also warrants special recognition. The
Committee noted Mr. Biddle's role in the growth of the Company (real estate
assets increased by approximately 28% and operating income increased by
approximately 39%) and awarded Mr. Biddle restricted stock in the amount of
93,750 Common Shares and 6,250 Class A Common Shares under the Restricted Stock
Plan. The restricted stock awarded to both Messrs. Urstadt and Biddle is subject
to continued employment and vests after ten years. In the event of a change in
control, the restricted stock would become 100% vested.
The Committee believes that the total compensation paid to Messrs.
Urstadt and Biddle was appropriate in light of the results achieved by the
Company under their leadership. By placing greater emphasis on restricted stock
awards tied to the Company's performance, the Committee believes that the
compensation of the Chief Executive Officer and President is more directly
linked to performance on behalf of all shareholders.
Compensation Committee:
E. Virgil Conway, Chairman
Robert R. Douglass
George H.C. Lawrence
21
Report of Audit Committee
The Audit Committee of the Company's Board of Directors consists of the
three non-employee directors listed below. Each of the members of the Audit
Committee is independent, as such term is defined by the listing standards of
the New York Stock Exchange (as amended from time to time). The Company's Board
of Directors has adopted a written charter for the Audit Committee. Subsequent
to the close of the fiscal year ended October 31, 2003, the Audit Committee
amended the charter and the amended charter was approved by the Board of
Directors on January 9, 2004. A copy of the charter, as amended, is attached to
this Proxy Statement as Appendix A. The duties of the Audit Committee are
summarized in this Proxy Statement on page 5 and are more specifically set forth
in the charter.
The Audit Committee has reviewed and discussed with management and Ernst
& Young LLP, the Company's independent auditor, the disclosures made in
"Management's Discussion and Analysis of Financial Condition and Results of
Operations" and the audited financial statements included in the Company's
Annual Report on Form 10-K for the fiscal year ended October 31, 2003. This
review included a discussion with the independent auditor of the matters
required to be discussed by Statement on Auditing Standards No. 61,
Communication with Audit Committees, as amended, by the Auditing Standards Board
of the American Institute of Certified Public Accountants.
The Audit Committee has received and reviewed the written disclosures
and the letter from the independent auditor required by Independence Standard
No. 1, Independence Discussions with Audit Committees, as amended, by the
Independence Standards Board, and discussed with the auditor the auditor's
independence. The Audit Committee has considered whether (and has determined
that) the provision by Ernst & Young LLP of the services described below under
"Fees Billed by Independent Auditors" is compatible with maintaining Ernst &
Young LLP's independence from both management and the Company.
In reliance upon the review and discussions referred to above and the
report of Ernst & Young LLP, the Audit Committee recommended to the Board of
Directors that the financial statements referred to above be included in the
Company's Annual Report on Form 10-K for the year ended October 31, 2003 for
filing with the SEC.
Among its responsibilities, the Audit Committee has sole authority to
retain, set the terms of engagement of, evaluate and, when appropriate, replace
the independent auditor. The Audit Committee has appointed Ernst & Young LLP to
audit the financial statements of the Company for the ensuing fiscal year and
recommends to the stockholders that such appointment be ratified (See Proposal
2).
Audit Committee:
Peter Herrick, Chairman
Robert R. Douglass
George J. Vojta
22
FEES BILLED BY INDEPENDENT AUDITORS
The SEC requires disclosure of the fees billed by the Company's
independent auditors for certain services. The following table sets forth the
aggregate fees billed during the fiscal years ended October 31, 2003 and 2002:
2003 2002
Ernst & Young LLP Ernst & Young LLP Arthur Andersen LLP
Fees Billed:
Audit Fees $187,500 $175,000 $ 7,500
Audit-Related Fees $ 32,500 $ 12,000 --
Tax Fees $ 57,494 $151,828 $15,370
All Other Fees $ 70,000 $ 70,000 --
-------- -------- -------
Total $347,494 $408,828 $22,870
======== ======== =======
Audit Fees include amounts billed to the Company related to the audit of
the consolidated financial statements of the Company and for quarterly reviews
for that year.
Audit-Related Fees include amounts billed to the Company for services
rendered in connection with required audits of certain acquired properties
during the year.
Tax Fees include amounts billed to the Company primarily for tax
planning and consulting, tax compliance and a review of the Company's and its
consolidated joint ventures' federal and state income tax returns.
All Other Fees include amounts billed to the Company primarily related
to SEC filings in connection with the Company's sale of equity securities.
On May 21, 2002, Ernst & Young LLP was appointed as successor
independent auditors of the Company, replacing Arthur Andersen LLP for the
fiscal year ended October 31, 2002.
Audit Committee Pre-Approval Policy
Provisions of the Sarbanes-Oxley Act of 2002 which require Audit
Committee pre-approval of all services to be performed by the independent
auditor became effective during the Company's 2003 fiscal year. Since the
effectiveness of such provisions on May 6, 2003, the Audit Committee approved,
prior to engagement, all audit and non-audit services provided by the Company's
independent auditors and all fees to be paid therefore. The Audit Committee has
pre-approved all audit services to be provided by the Company's independent
auditors related to reviews of the Company's quarterly financial reports on Form
10-Q for the year ending October 31, 2004. All other services are considered and
approved on an individual basis.
23
Shares Performance Graph
The following graph compares, for the five-year period beginning
October 31, 1998 and ended October 31, 2003, the Company's cumulative total
return to holders of the Company's Class A Common Shares and Common Shares with
the returns for the NAREIT All REIT Total Return Index (a peer group index)
published by the National Association of Real Estate Investment Trusts (NAREIT)
and for the S&P 500 Index for the same period.
COMPARISON OF CUMULATIVE TOTAL RETURN*
FOR THE FIVE-YEAR PERIOD OCTOBER 31, 1998 TO OCTOBER 31, 2003
AMONG URSTADT BIDDLE PROPERTIES INC. CLASS A COMMON SHARES (UBA),
URSTADT BIDDLE PROPERTIES INC. COMMON SHARES (UBP), THE S&P 500 INDEX
AND THE NAREIT ALL-REIT INDEX
10/98 10/99 10/00 10/01 10/02 10/03
----- ----- ----- ----- ----- -----
UBA................................... 100.00 102.95 108.44 156.33 197.26 261.52
UBP.................................... 100.00 97.54 105.12 142.49 197.34 243.51
S&P 500.............................. 100.00 125.67 133.33 100.12 85.00 102.68
NAREIT ALL-REIT INDEX...... 100.00 91.59 107.46 124.19 133.65 180.99
*$100 INVESTED ON 10/31/98 IN STOCK OR INDEX - INCLUDING REINVESTMENT
OF DIVIDENDS, FISCAL YEAR ENDING OCTOBER 31.
The stock price performance shown on the graph is not necessarily
indicative of future price performance.
24
SOLICITATION OF PROXIES AND VOTING PROCEDURES
The cost of soliciting proxies will be borne by the Company. In
addition to solicitation by mail, solicitations may also be made by personal
interview, facsimile transmission or telephone. Directors and officers of the
Company may participate in such solicitation and will not receive additional
compensation for such services. Arrangements will also be made with custodians,
nominees and fiduciaries for forwarding of proxy solicitation material to
beneficial owners of Class A Common Shares and Common Shares and the Company
will reimburse such custodians, nominees and fiduciaries for reasonable expenses
incurred in connection therewith.
The presence, either in person or by properly executed proxy, of a
majority of the Company's outstanding Class A Common Shares and Common Shares is
necessary to constitute a quorum at the Annual Meeting. Each Common Share
outstanding on the Record Date entitles the holder thereof to one vote and each
Class A Common Share outstanding on the Record Date entitles the holder thereof
to 1/20 of one vote. An automated system administered by the Company's transfer
agent tabulates the votes.
The election of the Directors, the ratification of the appointment of the
Company's auditors, the amendment of the Company's Dividend Reinvestment and
Share Purchase Plan and the amendment of the Company's Restricted Stock Award
Plan each requires the affirmative vote of a majority of the total combined
voting power of all classes of stock entitled to vote and present, in person or
by properly executed proxy, at the Annual Meeting. Abstentions will thus be the
equivalent of negative votes and broker non-votes will have no effect with
respect to such proposals, as any Class A Common Shares or Common Shares subject
to broker non-votes will not be present and entitled to vote with respect to any
proposal to which the broker non-vote applies.
Each of the Proposals presented to the Company at the Annual Meeting is
being presented as a separate and independent Proposal and no Proposal is
conditioned upon adoption or approval of any other Proposal.
AVAILABLE INFORMATION
The Company is subject to the informational requirements of the
Exchange Act, and in accordance therewith files reports, proxy statements, and
other information with the SEC. Such reports, proxy statements and other
information may be inspected without charge at the principal office of the SEC,
450 Fifth Street, N.W., Washington, D.C. 20549, and at the regional offices of
the SEC located at 233 Broadway, New York, New York 10279 and 175 W. Jackson
Blvd., Suite 900, Chicago, Illinois 60604, and copies of all or any part thereof
may be obtained at prescribed rates from the SEC's Public Reference Section at
such addresses. Also, the SEC maintains a World Wide Web site on the Internet at
http://www.sec.gov that contains reports, proxy and information statements and
other information regarding registrants that file electronically with the SEC.
Such reports, proxy and information statements and other information also can be
inspected at the office of the New York Stock Exchange, Inc., 20 Broad Street,
New York, NY 10005.
The Company's Annual Report to Stockholders for the fiscal year ended
October 31, 2003 (which is not part of the Company's proxy soliciting materials)
has been mailed to the Company's stockholders with or prior to this proxy
statement. A copy of the Company's Annual Report on Form 10-K, without exhibits,
will be furnished without charge to stockholders upon request to:
Thomas D. Myers, Secretary
Urstadt Biddle Properties Inc.
321 Railroad Avenue
Greenwich, CT 06830
25
CONTACTING THE BOARD OF DIRECTORS
Any shareholder who desires to contact the Company's Board of Directors
may do so by writing to: Board of Directors, c/o Secretary, Urstadt Biddle
Properties Inc., 321 Railroad Avenue, Greenwich, CT 06830. Communications
received will be distributed to the Chairperson of the appropriate committee of
the Board depending on the facts and circumstances outlined in the
communication. For example, complaints regarding accounting, internal accounting
controls and auditing matters will be forwarded to the Chairperson of the Audit
Committee. Communications marked to the attention of "Non-management Directors"
will be forwarded to the Nominating and Corporate Governance Committee.
OTHER MATTERS
The Directors know of no other business to be presented at the Annual
Meeting. If other matters properly come before the Meeting in accordance with
the Articles of Incorporation, the persons named as proxies will vote on them in
accordance with their best judgment.
The Company encourages, but does not require, that members of its Board
of Directors attend the Annual Meeting of Stockholders. All of the Directors
attended the Annual Meeting of Stockholders held March 12, 2003.
Any stockholder who intends to present a stockholder proposal for
consideration at the Company's 2005 Annual Meeting of Stockholders by utilizing
Rule 14a-8 under the Exchange Act, must comply with the requirements as to form
and substance established by the SEC for such proposals to be included in the
Company's proxy statement for such Annual Meeting and such proposals must be
received by the Company by October 12, 2004.
Any stockholder who intends to present a stockholder proposal for
consideration at the Company's 2005 Annual Meeting of Stockholders without
complying with Rule 14a-8 or who intends to make a nomination for election to
the Company's Board of Directors at the 2005 Annual Meeting of Stockholders,
must comply with certain advance notification requirements set forth in the
Company's bylaws. The Company's bylaws provide, in part, that any proposal for
stockholder action, or nomination to the Board of Directors, proposed other than
by the Board of Directors must be received by the Company in writing, together
with specified accompanying information, at least 75 days prior to an annual
meeting in order for such action to be considered at the meeting. The year 2005
Annual Meeting of Stockholders is currently anticipated to be held on March 9,
2005. Any notice of intent to consider other matters and/or nominees, and
related information, must therefore be received by the Company by December 24,
2004. The purpose of the bylaw is to assure adequate notice of, and information
regarding, any such matter as to which shareholder action may be sought.
You are urged to complete, date, sign and return your Proxy Card
promptly to make certain your Shares will be voted at the Annual Meeting, even
if you plan to attend the meeting in person. If you desire to vote your Shares
in person at the meeting, your proxy may be revoked. For your convenience in
returning the Proxy Card, a pre-addressed and postage paid envelope has been
enclosed.
YOUR PROXY IS IMPORTANT
WHETHER YOU OWN FEW OR MANY SHARES.
PLEASE DATE, SIGN AND MAIL THE ENCLOSED PROXY CARD TODAY.
26
APPENDIX A
COMMITTEE CHARTER
FOR THE AUDIT COMMITTEE
OF
URSTADT BIDDLE PROPERTIES INC.
(the "Company")
PURPOSE:
The Audit Committee (the "Committee") is appointed by the Board of Directors
(the "Board") to assist the Board in fulfilling its oversight responsibilities.
The Committee's primary duties and responsibilities are to: (1) monitor the
integrity of the Company's financial statements, financial reporting processes
and systems of internal controls regarding finance and accounting matters; (2)
monitor the Company's compliance with legal and regulatory requirements relating
to the foregoing; (3) monitor the independence and performance of the Company's
independent auditor and internal auditing function; (4) provide an avenue of
communication among the Board, the independent auditor, management and persons
responsible for the internal audit function; and (5) prepare an Audit Committee
report as required by the Securities and Exchange Commission ("SEC") to be
included in the Company's annual proxy statement.
The Committee shall have full and unrestricted access to all books, records,
facilities and personnel of the Company as required or appropriate in the
Committee's sole discretion to properly discharge its responsibilities. The
Committee has the authority to conduct any investigation appropriate to
fulfilling its responsibilities. The Committee has the authority to retain, at
the Company's expense, special legal, accounting or other consultants it deems
necessary in the performance of its duties. The Committee has the authority to
determine the amount of, and require the Company to pay, compensation to the
independent auditor for services rendered to the Company, compensation to any
independent legal, accounting and other advisors retained to advise the
Committee, and any administration expenses that are necessary or appropriate in
the Committee's sole discretion in the carrying out of the Committee's duties.
COMPOSITION:
The Audit Committee shall consist of at least three directors appointed by the
Board. Members of the Committee shall serve at the pleasure of the Board and the
Board shall designate a Chairperson of the Committee. All members of the
Committee shall be independent directors, free from any relationship that would
interfere with the exercise of independent judgment. Committee members shall
meet the independence and expertise requirements of the SEC and the New York
Stock Exchange (the "NYSE"), as the same may be modified or supplemented. All
members of the Committee shall have a basic understanding of finance and
accounting and be able to read and understand fundamental financial statements
at the time of their appointment to the Committee. At least one member of the
Committee shall have accounting or related financial management experience and
qualify as an "audit committee financial expert" in accordance with the
requirements of the SEC, as the same may be modified or supplemented.
Subject to the authority of the Committee to delegate certain functions as
described below, the Committee shall meet at least four times annually. A
majority of the members of the Committee entitled to vote, either present in
person or by means of remote communication or represented by proxy, shall
constitute a quorum of the Committee. A majority of the members in attendance
shall decide any question brought before any meeting of the Committee.
RESPONSIBILITIES:
The following functions shall be the common recurring activities of the
Committee in carrying out its oversight function.
Review/Discussion/Assessment Procedures
1. Review annually with management and the independent auditor the scope
and general extent of the independent auditor's examination prior to
the commencement of the annual audit.
2. Discuss the Company's annual audited financial statements and quarterly
financial statements with management and the independent auditor,
including the Company's disclosures under "Management's Discussion and
Analysis of Financial Condition and Results of Operations". Based on
such discussion, the Committee shall determine whether to recommend to
the Board that the annual audited financial statements be included in
the Company's Annual Report filed under the rules of the SEC. The
A-1
Committee may designate the Chairperson of the Committee to act on
behalf of the Committee in such discussions regarding the Company's
quarterly financial statements.
3. From time to time, discuss and review generally the Company's earnings
press releases, as well as financial information and earnings guidance
provided to analysts and rating agencies.
4. Discuss guidelines and policies with respect to risk assessment and
risk management and meet periodically with management to review the
Company's major financial risk exposures and the steps management has
taken to monitor and control such exposures.
5. Meet separately, periodically, with management, persons responsible for
the internal audit function and the independent auditor.
6. In consultation with management, the independent auditor and persons
responsible for the internal audit function, consider the integrity of
the Company's financial reporting processes and controls and review any
significant findings prepared by the independent auditor and persons
responsible for the internal audit function together with management's
response(s).
7. From time to time, review and discuss with management and/or the
independent auditor, significant financial reporting matters and
judgments made in connection with the preparation of the Company's
financial statements, and significant issues regarding accounting
principles and financial statement presentations, including changes to
the application of accounting principles.
8. Establish procedures for the receipt, retention and treatment of
complaints received by the Company regarding accounting, internal
accounting controls or audit matters, and the confidential, anonymous
submission by employees of concerns regarding questionable accounting
or auditing matters.
9. Report regularly to the Board of Directors.
10. Review and assess the adequacy of this Charter annually and recommend
any proposed changes to the Board for approval.
11. Review and assess the adequacy of the Committee's performance annually.
Independent Auditor
12. The independent auditor shall report directly to the Committee. The
Committee shall have the sole authority to, and shall, directly
appoint, retain, set the terms of engagement of, evaluate, terminate
(when circumstances warrant), oversee and cause the Company to
compensate the Company's independent auditor for the purpose of
preparing or issuing an audit report or performing other audit,
audit-related or attest services for the Company. Annually, the
Committee shall review the independence and performance of the
independent auditor, appoint the independent auditor, seek ratification
of such appointment by the Company's shareholders and approve the fees
to be paid to the independent auditor.
13. Obtain and review, at least annually, a report by the independent
auditor describing: the auditor's internal quality-control procedures;
any material issues raised by the most recent internal quality-control
review, or peer review, of the auditor, or by any inquiry or
investigation by governmental or professional authorities, within the
preceding five years, respecting one or more independent audits carried
out by the auditor, and any steps taken to deal with such issues.
14. At least annually, assess the independence of the independent auditor
and all relationships between the independent auditor and the Company.
15. Receive a formal written statement from the independent auditor
regarding the auditor's independence, including without
limitation, a delineation of all relationships between the auditor
and the Company; discuss such statement with the auditor, and if so
determined by the Committee, recommend that the Board take
appropriate action to satisfy itself of the independence of the
auditor. All engagements for non-audit services by the independent
auditor shall be approved by the Committee prior to the commencement
of such services. The Committee may designate a member of the
A-2
Committee to represent the entire Committee for purposes of approval
of non-audit services, subject to review by the full Committee at
the next regularly scheduled meeting. The Company's independent
auditor may not be engaged to perform activities prohibited under
the Sarbanes-Oxley Act of 2002, the rules of the Public Company
Accounting Oversight Board or the SEC.
16. Obtain from the independent auditor assurance that Section
10A of the Securities Exchange Act of 1934 has not been
implicated.
17. Discuss with the independent auditor the matters required to be
discussed by Statement on Auditing Standards No. 61 relating
to the conduct of the audit.
18. Review with the independent auditor any problems or difficulties
encountered by the auditor and any management letter provided by the
auditor, together with the Company's response to that letter. Such
review should include any difficulties encountered in the course of the
audit work, including any restrictions on the scope of activities or
access to required information.
19. Review any reports provided by the independent auditor to the Committee
as required under the Securities Exchange Act of 1934 with regard to:
(a) critical accounting policies and practices used by the Company; (b)
alternative treatments of financial information within GAAP for
policies and practices related to material items that have been
discussed with management (including ramifications of the use of such
alternative disclosures and treatments and the treatment preferred by
the independent auditor); and (c) other material written communications
between the independent auditor and management, such as any management
or internal control letter, or schedule of unadjusted differences.
Internal Audit Function
20. Review the budget, plan, changes in plan, activities, organization
structure and qualifications of persons responsible for the Company's
internal audit function, as needed.
21. Approve the appointment (including, if applicable, any engagement
terms), performance and replacement of persons responsible for the
Company's internal audit function.
22. Review significant reports prepared by persons responsible for the
internal audit function together with management's response to these
reports.
Other Responsibilities
23. Annually, prepare the report required by the rules of the SEC to be
included in the Company's annual proxy statement.
24. On at least an annual basis, review with the Company's counsel legal
matters that may have a material impact on the Company's financial
statements, the Company's compliance policies and any material reports
or inquiries received from regulators or governmental agencies.
25. Set clear policies for the hiring, by the Company, of current or former
partners, principals, shareholders or employees of the independent
auditor in accordance with applicable law.
26. Perform any other activities consistent with this Charter, the
Company's by-laws and governing law, as the Committee or the Board
deems necessary or appropriate.
LIMITATIONS OF COMMITTEE'S ROLE
While the Audit Committee has the responsibilities and powers set forth in this
Charter, it is not the duty of the Audit Committee to plan or conduct audits or
to determine that the Company's financial statements are complete and accurate
and are in accordance with generally accepted accounting principles. This is the
responsibility of management and the independent auditor.
In carrying out its responsibilities, the Committee and its policies and
procedures should remain flexible, in order to best react to changing conditions
and circumstances and, accordingly, the Committee may diverge from the foregoing
functions as appropriate given the circumstances.
DELEGATION
The Committee may, in its discretion, delegate all or a portion of its authority
and responsibilities to subcommittees (which may be the Chairperson of the
Committee or any one or more other members) of the Committee as it deems
appropriate and as permitted by applicable laws and regulations.
A-3
URSTADT BIDDLE PROPERTIES INC.
PROXY FOR ANNUAL MEETING OF STOCKHOLDERS
To be held on March 10, 2004
THIS PROXY IS SOLICITED BY THE
BOARD OF DIRECTORS OF URSTADT BIDDLE PROPERTIES INC.
The undersigned hereby constitutes and appoints Willing L. Biddle and Thomas D.
Myers, and each of them, as Proxies of the undersigned, with full power to
appoint his substitute, and authorizes each of them to represent and vote all
Class A Common Stock or Common Stock, par value $.01 per share, as appli-cable,
of Urstadt Biddle Properties Inc. (the Company) held of record as of the close
of business on January 26, 2004, at the Annual Meeting of Stockholders of the
Company (the Annual Meeting) to be held at Doral Arrowwood, Rye Brook, New
York, on Wednesday, March 10, 2004, and at any adjournments or postponements
thereof.
When properly executed, this proxy will be voted in the manner directed herein
by the undersigned stockholder(s). If no direction is given, this proxy will be
voted (i) FOR the election of one Director of the Company to serve for one year
and three Directors of the Company to serve for three years, as set forth in
Proposal 1; (ii) FOR the ratification of the appointment of Ernst & Young LLP as
the independent auditors of the Company for the ensu-ing fiscal year, as set
forth in Proposal 2; (iii) FOR the amendment of the Company's Dividend
Reinvestment and Share Purchase Plan; and (iv) FOR the amendment of the
Company's Restricted Stock Award Plan. In their discretion, the Proxies are each
authorized to vote upon such other business as may properly come before the
Annual Meeting and any adjournments or postponements thereof. A stockholder
wishing to vote in accordance with the Board of Directors' recommendations need
only sign and date this proxy and return it in the enclosed envelope. The
undersigned hereby acknowledge(s) receipt of a copy of the accompanying Notice
of Annual Meeting of Stockholders, the Proxy Statement and the Company's Annual
Report to Stockholders and hereby revoke(s) any proxy or proxies heretofore
given. This proxy may be revoked at any time before it is exercised by filing a
notice of such revocation, by filing a later dated proxy with the Secretary of
the Company or by voting in person at the Annual Meeting.
(Continued and to be signed and dated on reverse side.)
URSTADT BIDDLE PROPERTIES INC.
P.O. BOX 11040
NEW YORK, N.Y. 10203-0040
To change your address, please mark this box. x
Please vote and sign on this side
and return promptly in the
enclosed envelope. Do not forget
to date your proxy.
x
Please sign name exactly as shown. When there is more than one holder, each
should sign. When signing as an attorney, administrator, guardian or trustee,
please add your title as such. If execut-ed by a corporation or partnership, the
proxy should be signed by a duly authorized person, stating his or her title or
authority.
DETACH PROXY CARD HERE
Votes must be indicated
(x) in Black or Blue ink.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR EACH OF THESE PROPOSALS
Proposal 1. To elect one Director to serve for one year and three Directors to
serve for three years.
Nominees to serve for one year: Charles D. Urstadt.
Nominees to serve for three years: Willing L. Biddle, E. Virgil Conway and
Robert J. Mueller.
FOR all nominees listed below x
WITHHOLD AUTHORITY to vote for all nominees listed below x
* EXCEPTIONS
(INSTRUCTIONS: To withhold authority to vote for any individual nominee, mark
the Exceptions
box and write that nominee's name in the space provided below.)
*Exceptions ____________________________________________________________
Proposal 2. To ratify the appointment of Ernst & Young
LLP as the independent auditors of the
Company for one year.
x x x
FOR AGAINST ABSTAIN
Proposal 3. To amend the Company's Dividend
Reinvestment and Share Purchase Plan.
x x x
FOR AGAINST ABSTAIN
Proposal 4. To amend the Company's Restricted
Stock Award Plan.
x x x
FOR AGAINST ABSTAIN
Date Share Owner sign here Co-Owner sign here
Please sign exactly as your name appears hereon. When signing in a
representative capacity, please give full title.