<PAGE>
SCHEDULE 14A INFORMATION
PROXY STATEMENT PURSUANT TO SECTION 14(a)
OF THE SECURITIES EXCHANGE ACT OF 1934
Filed by the Registrant [X]
Filed by a Party other than the Registrant [ ]
Check the appropriate box:
[ ] Preliminary Proxy Statement
[ ] Confidential, for Use of the Commission Only (as permitted by Rule 14a-
6(e)(2))
[X] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to Section 240.14a-11(c) or Section
240.14a-12
United Financial Corp.
-------------------------------------------------------------
(Name of Registrant as Specified in its Charter)
----------------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement if Other that the Registrant)
Payment of Filing Fee (Check the appropriate box):
[X] No fee required.
[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and
0-11.
(1) Title of each class of securities to which transaction applies:
--------------------------------------------------------------------
(2) Aggregate number of securities to which transaction applies:
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(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (Set forth the amount on which the
filing fee is calculated and state how it was determined):
--------------------------------------------------------------------
(4) Proposed maximum aggregate value of transaction :
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(5) Total fee paid:
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[ ] Fee paid previously with preliminary materials.
[ ] Check box if any part of the fee is offset as provided by Exchange
Act Rule 0-11(a)(2) and identify the filing for which the offsetting
fee was paid previously. Identify the previous filing by registration
statement number, or the Form or Schedule and the date of its filing.
(1) Amount Previously Paid:
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(2) Form, Schedule or Registration Statement No.:
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(3) Filing Party:
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(4) Date Filed:
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<PAGE>
[UNITED FINANCIAL CORP. LOGO]
601 FIRST AVENUE NORTH
GREAT FALLS, MONTANA 59401
(406) 761-2200
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
To be Held April 23, 1997
NOTICE IS HEREBY GIVEN that the Annual Meeting of Shareholders of United
Financial Corp. (the "Company") will be held at the Company's offices, 601 First
Avenue North, Great Falls, Montana 59401 on April 23, 1997, at 1:30 p.m.,
Mountain time, for the following purposes:
1. To consider and vote upon an amendment to Article 2 of the Company's
Articles of Incorporation to change the par value of the Company's
Common Stock and Preferred Stock from $1.00 par value to no par value;
2. To elect two directors of the Company to serve on the Board of
Directors until the annual meeting of shareholders to be held in 2000
or until their successors are duly elected and qualified;
3. To ratify the appointment of KPMG Peat Marwick LLP as independent
auditors for the Company for the fiscal year commencing January 1,
1997;
4. To consider and act upon one stockholder proposal, if properly
presented to the meeting, which is set forth and described in the
attached Proxy Statement; and
5. To consider and act upon any other matters that may properly come
before the meeting or any adjournments thereof.
The Board of Directors has selected March 1, 1997 as the record date for
the Annual Meeting. Only those shareholders of record at the close of business
on that date will be entitled to receive notice of and to vote at the Annual
Meeting or any adjournment or adjournments thereof.
By the Order of the Board of Directors
/s/ Bruce K. Weldele
Bruce K. Weldele
CHAIRMAN OF THE BOARD AND
CHIEF EXECUTIVE OFFICER
Great Falls, Montana
March 27, 1997
<PAGE>
UNITED FINANCIAL CORP.
601 FIRST AVENUE NORTH
GREAT FALLS, MONTANA 59401
(406) 761-2200
-------------------------------
PROXY STATEMENT
-------------------------------
INFORMATION RELATING TO VOTING AT THE ANNUAL MEETING
This Proxy Statement (the "Proxy Statement") is being furnished to
shareholders of United Financial Corp., a Minnesota corporation (the "Company"),
in connection with the solicitation of proxies by the Company for use at the
Annual Meeting of Shareholders ( the "Annual Meeting") to be held at 601 First
Avenue North in Great Falls, Montana on April 23, 1997, at 1:30 p.m., Mountain
time, and at any adjournment or adjournments thereof. The approximate date of
mailing of this proxy statement and the accompanying form of proxy is March 27,
1997.
The Board of Directors of the Company has selected March 1, 1997 as
the record date for the determination of shareholders entitled to notice of and
to vote at the Annual Meeting. A total of 1,223,312 shares of the Company's
Common Stock were outstanding as of the close of business on that date.
Shareholders will be entitled to cast one vote for each share of the Company's
Common Stock held by them of record at the close of business on the record date
on any matter that may be presented at the Annual Meeting for consideration and
action by the shareholders.
All valid proxies received in response to the solicitation will be
voted in accordance with the instructions indicated thereon by the shareholders
giving such proxies. If no contrary instructions are given, each such proxy
will be voted in favor of the amendment to the Articles of Incorporation of the
Company, in favor of the election of the two Director nominees named in this
proxy statement, unless and to the extent authority to do so is withheld in the
enclosed proxy, in favor of the proposal to ratify the appointment of KPMG Peat
Marwick LLP as independent auditors for the Company and against the shareholder
proposal. Shares voted as "withhold vote for" one or more directors will be
counted as shares that are present and entitled to vote for purposes of
determining the presence of a quorum at the meeting and as unvoted, although
present and entitled to vote, for purposes of the election of the directors with
respect to which the shareholder has abstained. If a broker submits a proxy
that indicates the broker does not have discretionary authority to vote certain
shares, those shares will be counted as shares that are present and entitled to
vote for purposes of determining the presence of a quorum at the meeting, but
will not be considered as present and entitled to vote with respect to the
matters voted on at the meeting.
The Board of Directors does not know of any business to be presented
for action at the Annual Meeting other than that described herein. If any other
business is properly presented at the Annual Meeting and may be properly voted
upon, the proxies solicited hereby will be voted on such matters in accordance
with the best judgment of the proxy holders named therein. The Company's bylaws
provide that shareholder proposals not included in this year's proxy
solicitation materials must be submitted in writing to the Secretary of the
Company at least five days before the Annual Meeting in order to be considered
at the meeting.
Any shareholder has the power to revoke his proxy at any time before
it is voted at the Annual Meeting by filing written notice of such revocation to
the Secretary of the Company (which notice shall be given by the filing of a
duly executed proxy bearing a later date) or by attending the Annual Meeting and
voting in person. Proxies solicited by the Company's Board of Directors hereby
are for use solely at the Annual Meeting and any adjournment or adjournments
thereof.
The expense of this proxy solicitation will be borne by the Company.
To the extent necessary, proxies may be solicited by personnel of the Company in
person, by telephone, or through other forms of
<PAGE>
communication. Company personnel who participate in the solicitation will not
receive any additional compensation for such solicitation. The Company will
request recordholders of shares beneficially owned by others to forward this
proxy statement and related materials to the beneficial owners of such shares
and will reimburse such recordholders for their reasonable expenses incurred in
doing so.
SECURITIES OWNERSHIP OF CERTAIN BENEFICIAL OWNERS
Except as set forth in the table below, no person is known to the Company
to own beneficially more than 5% of the outstanding shares of the Company's
Common Stock.
Name and Address Amount and Nature of Percent
of Beneficial Owner Beneficial Ownership of Class
------------------------ -------------------- ------------
Eighteen Seventy Financial Inc. 120,000 9.8%(1)
Two Manhattanville Road
Purchase, New York 10577
- ------------------------
(1) As reported by Schedule 13D dated August 30, 1996 filed by Eighteen Seventy
Financial, Inc. and its parent corporation, Eighteen Seventy Corporation.
SECURITIES OWNERSHIP OF MANAGEMENT
The following table sets forth information as of March 1, 1997 concerning
the shares of Company's Common Stock beneficially owned by each director, by
each nominee for director, by each executive officer named in the Summary
Compensation Table and by all directors and executive officers of the Company as
a group. Except as otherwise noted, each beneficial owner listed has sole
investment and voting power with respect to the common stock indicated.
Number of Shares
Name of Individual or of Common Stock Percent
Number of Persons in Group Beneficially Owned of Class
--------------------------- -------------------- --------
Bruce K. Weldele 30,000 (1) 2.5%
J. William Bloemendaal 28,760 (2)(3) 2.4
Elliott L. Dybdal 18,750 (3) 1.5
William L. Madison 100 *
Dean J. Mart 5,000 *
Rudy Tramelli 100 (3) *
Larry D. Williams 150 (3) *
All directors and executive
officers as a group (11 persons) 101,030 8.3%
- ------------------------
(1) Includes 5,000 shares held by Bruce K. Weldele in an Individual Retirement
Account.
(2) Includes 4,000 shares held by Dr. Bloemendaal in an Individual Retirement
Account and 10,000 shares held by Great Falls Orthopaedic Associates Profit
Sharing and Pension Plans of which Dr. Bloemendaal is trustee.
(3) Voting and investment power is shared with spouse with whom shares are held
jointly.
2
<PAGE>
PROPOSAL ONE--AMENDMENT TO ARTICLE 2 OF THE COMPANY'S ARTICLES OF
INCORPORATION TO CHANGE THE PAR VALUE OF THE COMPANY'S COMMON STOCK AND
PREFERRED STOCK FROM $1.00 PAR VALUE TO NO PAR VALUE
The Company's Board of Directors has unanimously approved the amendment to
its Articles of Incorporation to change the par value of the Company's Common
Stock and Preferred Stock from $1.00 par value to no par value ("Articles
Amendment"). The Company's Board believes the adoption of the foregoing
Articles Amendment is in the best interests of all of the Company's shareholders
and recommends that the Company's shareholders vote in favor of the Articles
Amendment.
THE COMPANY'S BOARD OF DIRECTORS RECOMMENDS A VOTE "FOR" THE FOLLOWING
RESOLUTIONS WHICH WILL BE PRESENTED AT THE COMPANY'S ANNUAL MEETING:
RESOLVED, that Article 2(a) of the Articles of Incorporation of
the Company be, and hereby is, replaced with the following:
"AUTHORIZED CAPITAL STOCK. The total number of shares of capital
stock which the Corporation is authorized to issue shall be 10,000,000
shares, consisting of 8,000,000 shares of no par value common stock
("Common Stock") and 2,000,000 shares of no par value preferred stock
("Preferred Stock"). There shall be no cumulative voting among
shareholders of the Corporation. The shareholders of the Corporation
shall not have, as a matter of right, any preemptive rights to
subscribe for or acquire securities or rights to purchase securities
of any class, kind or series of the Corporation."
RESOLVED FURTHER, that the officers of the Company be, and hereby
are, authorized and directed to execute such documents and
certificates and take such other action as may be necessary or
appropriate to give effect to the foregoing resolution.
Article 2(a) of the Company's Articles of Incorporation currently provides
for a $1.00 par value of the Company's Common Stock and Preferred Stock. The
Articles Amendment would provide that the Company's Common Stock and Preferred
Stock have no par value. The Articles Amendment would reduce shareholder
expenses associated with reprinting stock certificates in the event of a
recapitalization. It would also maximize the efficiency of shareholder
transactions.
The affirmative vote of a majority of the holders of the Common Stock and
the Preferred Stock entitled to vote at the meeting is necessary to approve the
Articles Amendment. If not otherwise specified, properly executed proxies will
be voted in favor of the Articles Amendment.
PROPOSAL TWO--ELECTION OF DIRECTORS
In accordance with the Company's bylaws, the Company's Board of Directors
is divided into three classes, each class to have, as nearly as possible, an
equal number of members. The members of each class are elected for terms of
three years with one of the three classes of directors to be elected each year.
The number of directors currently authorized by the Company's bylaws is seven.
Two persons have been nominated for election to the Company's Board of
Directors for three-year terms expiring in 2000. Each of the nominees listed
below is currently a director and has consented to being named in this proxy
statement and has indicated his willingness to serve if elected. If any nominee
becomes unable to serve, the proxy solicited hereby will be voted for the
election of such other person or persons as the Board of Directors shall select.
3
<PAGE>
The following table sets forth the names of and certain information
concerning the nominees and continuing members of the Board of Directors of the
Company.
<TABLE>
<CAPTION>
Director Term of Positions Currently Held
Nominees For Director Age Since Office Expires With The Holding Company
--------------------- ---- ------- -------------- -------------------------
<S> <C> <C> <C> <C>
Rudy Tramelli 68 1971 1997 Director
Larry D. Williams 54 1991 1997 Director
Continuing Directors
--------------------
J. William Bloemendaal 67 1976 1998 Director
Elliott L. Dybdal 65 1980 1998 Director
William L. Madison 41 1996 1999 Director
Dean J. Mart 55 1988 1999 Director, Senior Vice President
-Loan Administration
Bruce K. Weldele 51 1983 1999 Chairman, President, Chief
Executive Officer and Director
</TABLE>
MR. TRAMELLI is self-employed and engages in real estate management and
development. He has been actively employed in these business activities for
over 32 years.
MR. WILLIAMS is the Superintendent of the Great Falls Public Schools.
Before his appointment as Superintendent in July 1989, Mr. Williams served
for five years as the Director of Personnel for the Bozeman, Montana Public
Schools. His 28-year career in education has included 8 years as a classroom
instructor of music at the elementary, secondary and collegiate level and 19
years in a variety of administrative positions.
DR. BLOEMENDAAL is a full-time physician specializing in orthopaedic
surgery. He has practiced medicine since 1961 and has been associated since
1975 with Great Falls Orthopaedic Associates, a five-person group actively
practicing orthopaedic surgery. Dr. Bloemendaal currently serves as
President of Great Falls Orthopaedic Associates.
MR. DYBDAL has been employed by Talcott Building Company in Great Falls
for over 34 years, serving for the last 21 years as its President and Chief
Executive Officer. He also serves as a director of Talcott Building Company.
MR. MADISON has served as President/owner of Johnson Madison Lumber Co.,
Inc., a retail building materials business, since 1984.
MR. MART joined the Company in July 1984 as Senior Vice President. Since
that time, he has been responsible for loan administration. Before joining the
Company, he was employed for over 20 years by Norwest Company Great Falls, N.A.,
and served during a period of that time as Vice President - Commercial Loan
Officer.
MR. WELDELE joined the Company in 1983 as Executive Vice President. He has
served as President and Chief Executive Officer since October 1983. Mr. Weldele
was first elected to the Board of Directors in July 1983. Since January 1984,
he has served as Chairman of the Board.
BOARD MEETINGS AND COMMITTEES
The Board of Directors, which met 12 times during the fiscal year ended
December 31, 1996, meets monthly and may have special meetings. Each of the
present directors attended at least 75% of the
4
<PAGE>
meetings of the Board of Directors and of the Board committees of which he was a
member in 1996. The standing committees of the Board of Directors of the
Company include the Audit, Nominating, Fringe Benefits and Loan Committees.
The Audit Committee consists of five members of the Board of Directors:
Elliott L. Dybdal (Chairman), J. William Bloemendaal, William A. Madison, Rudy
Tramelli and Larry D. Williams. The Committee is responsible for selecting the
outside audit firm for the Company, reviewing the auditor's and the SEC and OTS
reports of examination, and overseeing matters relating to internal controls.
The Audit Committee met once during the fiscal year ended December 31, 1996.
The Nominating Committee for the fiscal year ending December 31, 1997
consists of three directors: J. William Bloemendaal (Chairman), Elliott L.
Dybdal and William L. Madison. The Nominating Committee is responsible for
interviewing and submitting the names of qualified candidates for director to
the Secretary at least 20 days prior to the Annual Meeting. Company
shareholders who wish to nominate director candidates must deliver such
nominations in writing to the Secretary at least five days prior to the date of
the Annual Meeting. The Nominating Committee met once during the fiscal year
ended December 31, 1996.
The Fringe Benefits Committee consists of five members of the Board of
Directors: Larry D. Williams (Chairman), J. William Bloemendaal, Elliott L.
Dybdal, William L. Madison and Rudy Tramelli. The Committee is responsible for
reviewing and approving the various fringe benefit programs that the Company
provides to its employees. The Fringe Benefits Committee met twice during the
fiscal year ended December 31, 1996.
All members of the Board of Directors are authorized to serve on the Loan
Committee. Only three are required to take action at any particular meeting.
The directors who serve at particular meetings of the Loan Committee vary
depending upon who is available at the time the Committee must meet. The most
senior director present at any such Loan Committee meeting serves as Chairman
for the meeting. This Committee, which must approve all loans in excess of
$250,000, meets only when a loan of this amount is proposed. The Loan Committee
met once during the fiscal year ended December 31, 1996.
COMPENSATION OF DIRECTORS
Directors employed by the Company are not compensated for their services on
the Board of Directors. All directors not employed by the Company receive a
monthly retainer of $500. This amount was increased from $450 in May, 1996. In
addition, directors not employed by the Company received $500 for attendance at
each monthly meeting. Directors not employed by the Company also receive
compensation for attendance at special committee meetings at a rate of $50 per
hour. Two special committee meetings were held during the fiscal year ended
December 31, 1996.
THE BOARD OF DIRECTORS RECOMMENDS THAT THE SHAREHOLDERS VOTE FOR THE
ELECTION OF THE ABOVE NOMINEES FOR THE TERMS INDICATED.
PROPOSAL THREE--RATIFICATION OF APPOINTMENT OF AUDITORS
KPMG Peat Marwick LLP was the Company's independent public accountant for
the 1996 fiscal year. The Board of Directors has approved the selection of
KPMG Peat Marwick LLP as its auditors for the fiscal year commencing January 1,
1997, subject to ratification by the Company's shareholders. A representative
of KPMG Peat Marwick LLP is expected to be present at the Meeting to respond to
shareholders' questions and will have the opportunity to make a statement if he
or she so desires.
Ratification of the appointment of the auditors requires the affirmative
vote of a majority of the votes cast by the shareholders of the Company at the
Meeting. THE BOARD OF DIRECTORS RECOMMENDS THAT
5
<PAGE>
SHAREHOLDERS VOTE "FOR" THE RATIFICATION OF THE APPOINTMENT OF KPMG PEAT MARWICK
LLP AS THE COMPANY'S AUDITORS FOR THE FISCAL YEAR COMMENCING JANUARY 1, 1997.
PROPOSAL FOUR--SHAREHOLDER PROPOSAL
The following shareholder's proposal has been submitted for a vote of the
shareholders at the Annual Meeting. To be adopted, a proposal must be approved
by the affirmative vote of the majority of shares present or represented by
proxy at the Annual Meeting.
Mr. Roderick E. Peterson, 2621 Ninth Avenue South, Great Falls, Montana
59405, advises that he intends to present for consideration and action at the
Annual Meeting the following resolution:
RESOLVED: That the shareholders of United Financial Corp.
recommend that the Board of Directors institute a Director Ownership
Plan in order to have a financial interest in the business of United
Financial Corp.
The following is proposed:
Ownership of Stock by non-employee directors
"The monthly retainer fee shall be paid monetarily in one-third
(1/3) cash and two-thirds (2/3) reinvested in stock of the Company for
a period sufficient enough (or as long as Directorship is maintained)
until ownership of common stock amounts to the greater of; (1)
$25,000 market value or (2) until such time that a minimum of 1000
shares of United Financial Corp. common stock be owned and/or
registered in the name of such Director only with cumulative family
ownership not included."
Ownership of Stock by employee directors.
"Required ownership of common stock shall be the greater of; (1)
$25,000 market value or (2) .25 percent (.0025) of total outstanding
common stock of United Financial Corp."
Mr. Peterson has submitted the following statement in support of his
proposal:
"Increased stock ownership for all members of the Board further
strengthens the commonality of interest between the Board of
Directors and the shareholders."
6
<PAGE>
INFORMATION RELATING TO EXECUTIVE OFFICERS
The following table sets forth information with respect to the executive
officers of the Company or United Savings Bank (the "Bank") who are not
directors of the Company or the Bank. All executive officers are elected
annually by the Board of Directors and serve at the discretion of the Board of
Directors.
<TABLE>
<CAPTION>
Name Age Position Held
---------------------- ----- -------------------------------------
<S> <C> <C>
Charles J. Hallingstad 46 Vice President - Marketing and Human
Resources
Loyall Kissee 55 Vice President - Branch and Savings
Administration, Secretary and Branch
Manager
G. Brent Marvosh 49 Vice President - Finance/Treasurer
Michael J. McCleary 48 Vice President - Operations
</TABLE>
Mr. Hallingstad joined the Bank in 1972 and has served in various
capacities since that time. In January 1981, he was named Vice President in
charge of Marketing. Since January 1984, he has served as Vice President in
charge of Marketing and Human Resources.
Mr. Kissee joined the Bank in 1974 and has held various positions since
that time. In March 1980, he was elected Vice President in charge of Branch and
Savings Administration. In 1981, Mr. Kissee was elected Secretary of the Bank
and has served in that capacity since that time. Since February 1986, he has
served as Branch Manager of the Bank's branch office in Havre.
Mr. Marvosh, a certified public accountant, joined the Bank in October 1980
and has served the Company in various capacities since that time. Commencing
January 1983, he served as Assistant Controller and in November 1983 was elected
Treasurer/Controller. In October 1985, he was elected Vice President in
addition to his position as Treasurer/Controller.
Mr. McCleary joined the Bank in 1977 and has acted in several different
capacities since that time. In January 1981, he became Assistant Vice President
having responsibilities as Treasurer/Controller until January 1983 when he
became Assistant Vice President in charge of Operations. In October 1985, he
was elected Vice President in charge of Operations.
7
<PAGE>
EXECUTIVE COMPENSATION AND OTHER INFORMATION
SUMMARY COMPENSATION TABLE. The following table shows the cash
compensation paid by the Company for services rendered during the past three (3)
fiscal years ended December 31, 1996, to its President and Chief Executive
Officer. No other executive officer received total cash compensation during the
period exceeding $100,000.
<TABLE>
<CAPTION>
LONG TERM COMPENSATION
ANNUAL COMPENSATION --------------------------------------
Name of Individual Fiscal ----------------------------- Restricted Options LTIP All Other
And Principal Positions Year Salary(1) Bonus Other Stock(2) SARS(2) Payouts Comp.(3)
- ------------------------ ------ ----------- ----- ----- -------- ------ ------- --------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Bruce K. Weldele 1996 $155,100 -0- -0- -- -- -- $1,900
Chairman of the Board, 1995 150,000 -0- -0- -- -- -- 3,080
President and Chief 1994 144,000 -0- -0- -- -- -- 3,080
Executive Officer and
Director
- ---------------
</TABLE>
(1) Includes earnings reductions contributions made by Bruce K. Weldele to the
Company's 401(k) Plan (or that of the Bank prior to the formation of the
Company).
(2) Neither the Company nor the Bank maintains any plan pursuant to which it
has granted or issued options, SARs, restricted stock, or other stock based
compensation to executives.
(3) Represents the Company's or the Bank's contributions on behalf of
Bruce K. Weldele to the 401(k) Thrift Retirement Plan.
PENSION PLAN. The Company has a noncontributory defined benefit pension
plan (the "Pension Plan") which is administered by the Financial Institutions
Retirement Fund (the "Fund"). The Fund is a nonprofit, tax-qualified pension
plan and trust through which Federal Home Loan Banks, savings and loan
associations and similar institutions may cooperate in providing for the
retirement of their employees.
After becoming eligible for membership in the Pension Plan, employees who
complete 1,000 hours of service each calendar year will be enrolled as active
members and will be entitled to accrue retirement benefits under the Pension
Plan. The monthly pension amount to be received by an employee under the
Pension Plan upon retirement is based on an employee's benefit service and
salary. Benefit service includes the period of employment as an active member
in the Pension Plan in addition to any previous employment prior to the date the
Company joined the Fund and for which it has purchased credit. Salary for
purposes of the Company's contributions to the Pension Plan includes an
employee's basic annual salary rate as of each January 1, exclusive of any
special payments.
Whether an employee has a vested right to receive retirement benefits under
the Pension Plan depends upon the employee's age and years of vesting service.
Vesting service includes the period of time beginning from the first day of the
month in which an employee was hired and the last day of the month in which the
employee terminates his or her employment. Vesting service specifically
excludes service performed after an employee has attained the age of 65 and does
not include any period of employment that precedes the earliest date that the
Holding Company provided the employee with credit under any pension plan. An
active member employee who has performed 5 years of vesting service, is fully
vested and is entitled to receive 100% of his retirement benefits under the
Pension Plan upon attaining the age of 65, whether or not such employee has
terminated employment with the Company prior to attaining the age of 65. Any
employee who has completed fewer than 5 years of vesting service will not be
eligible to receive retirement benefits if such employee terminates service with
the Company prior to becoming fully vested.
Retirement benefits under the Pension Plan will be paid when an employee
entitled to such benefits attains the normal retirement age of 65. In certain
circumstances, some individuals may be
8
<PAGE>
entitled to receive early retirement benefits upon attaining the age of 45,
although such benefits will be reduced on the basis of an early retirement
factor that is applied to the full amount the employee would be entitled to
receive at the normal retirement age of 65.
The following table sets forth, in straight life annuity amounts, the
estimated benefits payable upon retirement to active member participants in the
Pension Plan. The estimated annual benefits set forth in the table do not
reflect, however, refunds of contributions that members made and elected to
receive while the Company participated on a contributory basis. Salary is
calculated on the basis of the employee's average salary in the five highest
consecutive years of compensation; provided, however, if an employee has fewer
than five years of service at the time of his retirement, salary is based on the
employee's previous year's salary and, assuming salaries increase at 5% per
annum, the estimated pension benefits are approximately 15% lower than those
reflected in the table based on the 5-year highest salary average.
<TABLE>
<CAPTION>
Years of Service
--------------------------------------------------------------------------
Salary 15 20 25 30 35
---------- ---------- --------- --------- --------- ----------
<S> <C> <C> <C> <C> <C>
$ 30,000 $ 10,125 $ 13,500 $ 16,875 $ 20,250 $ 23,625
40,000 13,500 18,000 22,500 27,000 31,500
50,000 16,875 22,500 28,125 33,750 39,375
60,000 20,250 27,000 33,750 40,500 47,250
70,000 23,625 31,500 39,375 47,250 55,125
80,000 27,000 36,000 45,000 54,000 63,000
90,000 30,375 40,500 50,625 60,750 70,875
100,000 33,750 45,000 56,250 67,500 78,750
110,000 37,125 49,500 61,875 74,250 86,625
120,000 40,500 54,000 67,500 81,000 94,500
130,000 43,875 58,500 73,125 87,750 102,375
</TABLE>
During the fiscal year ended December 31, 1996, no funds were paid or
distributed pursuant to the Pension Plan to Mr. Weldele, the most highly
compensated executive officer named above. At December 31, 1996, Mr. Weldele
had twelve years of credited service under the Pension Plan and his defined
compensation for purposes of the Pension Plan as of December 31, 1996 was
$127,800.
EXECUTIVE OFFICER SEVERANCE AGREEMENTS. During fiscal year 1993, the Board
of Directors approved change of control severance agreements for each of the
executive officers of the Company and the Bank. The agreements provide for
severance compensation for each of the executive officers in the event any
company or person acquires control of the Bank, as determined in accordance with
applicable federal regulations. Pursuant to his agreement, upon a change of
control, Mr. Weldele would be entitled to lump-sum compensation equal to two
times his annual base salary plus any target bonuses, and 24 months of continued
welfare and employee benefits. The agreements with all other executive officers
provide for payment upon a change of control of lump-sum compensation equal to
the annual base salary, plus any target bonuses, and 12 months of continued
welfare and employee benefits.
BOARD OF DIRECTORS REPORT ON EXECUTIVE COMPENSATION. The Board of Directors
has furnished the following report on executive compensation:
All directors not employed by the Company annually review salary
recommendations made by the Chief Executive Officer which cover all
officers (other than the Chief Executive Officer). The specific
recommendations reflect the job responsibilities assigned to each officer,
the manner in which those duties have been performed, and the prevailing
market conditions relative to each position.
9
<PAGE>
Compensation of the Chief Executive Officer for 1996 was reviewed by
the directors and increased at approximately the inflation rate.
Elliott L. Dybdal
J. William Bloemendaal
Rudy Tramelli
Larry D. Williams
William L. Madison
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS BETWEEN MANAGEMENT AND THE
COMPANY
The Company is a holding company for United Savings Bank, F.A. (the
"Bank"). The Bank is a federally chartered savings bank headquartered in Great
Falls, Montana. The Company makes mortgage and consumer loans to the Company's
directors, officers and employees in accordance with regulations promulgated by
the OTS and other applicable statutes and regulations. These loans are
currently made in the ordinary course of business on substantially the same
terms, including interest rates and collateral, as those prevailing at the time
for comparable transactions with nonaffiliated persons and, in the judgment of
management, do not involve more than the normal risk of collectibility or
present other unfavorable features.
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STOCK PRICE PERFORMANCE GRAPH(1)
The graph below compares cumulative total shareholder return of the
Company, the S&P 500 Index and the S&P Savings and Loan Holding Company Index.
Total returns assume a $100 investment on December 31, 1991 and are based on
quarterly reinvestment of dividends and quarterly stock prices.
TOTAL SHAREHOLDER RETURNS
[GRAPH]
<TABLE>
<CAPTION>
1991 1992 1993 1994 1995 1996
---- ---- ---- ---- ---- ----
<S> <C> <C> <C> <C> <C> <C>
United Financial Corp. 100 138.71 221.47 164.94 191.94 221.31
S & P 500 Index 100 105.30 110.42 96.01 158.29 189.44
S & P Savings and Loan Holding Company Index 100 107.62 118.46 120.03 165.13 203.05
</TABLE>
(1) The years from 1991 through 1995 of the Stock Performance Graph
incorporates the performance of the United Savings Bank, F.A. prior to
the formation of the holding company.
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ANNUAL REPORT
The Company's Annual Report to Shareholders for the fiscal year ended
December 31, 1996, including, but not limited to, statements of consolidated
financial condition at December 31, 1996 and 1995 and related statements of
consolidated income, changes in shareholders' equity and cash flows for the
years ended December 31, 1996, 1995, and 1994 prepared in conformity with
generally accepted accounting principles, has been provided under separate
cover. The Company will file with the SEC, for the year ended December 31,
1996, an Annual Report on Form 10-K, together with applicable financial
statements and schedules thereto. THE COMPANY WILL FURNISH, WITHOUT CHARGE,
UPON WRITTEN REQUEST OF ANY SHAREHOLDER WHO REPRESENTS IN HIS REQUEST THAT HE
WAS THE BENEFICIAL OWNER OF THE COMPANY'S COMMON STOCK ON MARCH 1, 1997, A COPY
OF THE ANNUAL REPORT ON FORM 10-K. Requests should be directed to: G. Brent
Marvosh, Vice President, P.O. Box 2509, Great Falls, Montana 59403.
SHAREHOLDER PROPOSALS
Any shareholder of the Company wishing to have a proposal consideration for
inclusion in the Company's 1998 proxy solicitation materials must set forth such
proposal in writing and file it with the Secretary of the Company on or before
November 23, 1997. Shareholder proposals not included in the Company's 1997
proxy solicitation materials must, in order to be considered at the 1998 Annual
Meeting, be submitted in writing to the Secretary of the Company at least five
days before the date announced for next year's Annual Meeting. The Board of
Directors of the Company will review any shareholder proposals which are filed
as required and will determine whether such proposals meet applicable criteria
either for inclusion in its 1998 proxy solicitation materials or for
consideration at the 1998 Annual Meeting.
YOU ARE URGED TO VOTE, SIGN, DATE AND RETURN THE ACCOMPANYING PROXY IN THE
ENCLOSED POSTAGE-PAID ENVELOPE AT YOUR EARLIEST CONVENIENCE, WHETHER OR NOT YOU
CURRENTLY PLAN TO ATTEND THE ANNUAL MEETING IN PERSON.
By the Order of the Board of Directors
/s/ Bruce K. Weldele
BRUCE K. WELDELE
CHAIRMAN OF THE BOARD AND
CHIEF EXECUTIVE OFFICER
Great Falls, Montana
March 27, 1997
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UNITED FINANCIAL CORP.
REVOCABLE PROXY FOR 1997 ANNUAL MEETING OF SHAREHOLDERS
THIS PROXY IS SOLICITED BY THE BOARD OF DIRECTORS
The undersigned hereby appoints the Board of Directors of United Financial
Corp., with full powers of substitution, to vote all shares of Common Stock of
United Financial Corp. which the undersigned is entitled to vote at the Annual
Meeting of Shareholders ("Meeting"), to be held at the main office of the Bank,
601 First Avenue North, Great Falls, Montana 59401 on Wednesday, April 23, 1997,
at 1:30 p.m. Montana Time and at any and all adjournments thereof, as follows:
1. To consider and vote upon an amendment to Article 2 of the Company's
Articles of Incorporation to change the par value of the Company's
Common Stock and Preferred Stock from $1.00 par value to no par value.
/ / FOR / / AGAINST / / ABSTAIN
2. The election as director of two nominees listed below each for a 3
year term (except as marked to the contrary):
/ / FOR / / WITHHELD
TO WITHHOLD YOUR VOTE FOR ANY INDIVIDUAL NOMINEE, PLACE A LINE THROUGH
THE NOMINEE'S NAME BELOW:
Rudy Tramelli, Larry D. Williams
3. Proposal to ratify the appointment of KPMG Peat Marwick LLP as
independent auditors of United Financial Corp., for the fiscal year
ending December 31, 1997.
/ / FOR / / AGAINST / / ABSTAIN
4. Shareholder Proposal to institute a Director Ownership Plan.
/ / FOR / / AGAINST / / ABSTAIN
The Board of Directors recommends a vote "FOR" propositions 1, 2 and 3.
THIS PROXY WILL BE VOTED AS DIRECTED, BUT IF NO INSTRUCTIONS ARE SPECIFIED, THIS
PROXY WILL BE VOTED FOR EACH OF THE PROPOSITIONS STATED.
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This proxy may be revoked by filing a subsequently dated proxy or by
notifying the Secretary of the Bank of your decision to revoke this proxy,
either in person at the Meeting or in writing.
When shares are held by joint tenants, both should sign. When signing as
attorney, executor, administrator, trustee or guardian, please give full title
as such. If a corporation, please sign in full corporate name by President or
other authorized officer. If a partnership, please sign in partnership name by
authorized person.
Date:______________________________, 1997
_______________________________________
Signature
_______________________________________
Signature if jointly held
PLEASE MARK, DATE AND RETURN THIS PROXY PROMPTLY
