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
NMBT CORP
- --------------------------------------------------------------------------------
(Name of Registrant as Specified in Its Charter)
NMBT CORP
- --------------------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement)
Payment of Filing Fee (Check the appropriate box):
[X] No filing 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:
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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.
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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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4) Date Filed:
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<PAGE>
LOGO
Notice of Annual
Meeting of Stockholders
to be held
May 4, 1999
and
Proxy Statement
YOUR VOTE IS IMPORTANT
IT IS IMPORTANT THAT YOUR SHARES BE REPRESENTED AT THIS MEETING.
ACCORDINGLY, WE URGE YOU TO COMPLETE, SIGN, DATE AND RETURN THE PROXY AS SOON AS
POSSIBLE IN THE ENCLOSED ENVELOPE, WHICH REQUIRES NO POSTAGE IF MAILED IN THE
UNITED STATES. RETURNING YOUR PROXY DOES NOT DEPRIVE YOU OF YOUR RIGHT TO ATTEND
THE MEETING AND TO VOTE YOUR SHARES IN PERSON.
<PAGE>
LOGO
March 31, 1999
Dear Stockholder:
On behalf of the Board of Directors, I cordially invite you to attend the
Annual Meeting of Stockholders of NMBT CORP (the "Company"), which will be held
at the Park Lane Office located at 100 Park Lane, New Milford, Connecticut on
Tuesday, May 4, 1999, at 7:00 p.m. local time. We look forward to seeing as many
stockholders as possible at this meeting.
At the Annual Meeting, you will be asked to vote upon the election of
directors and appointment of auditors for the year ending December 31, 1999.
Such other business will be transacted as may properly be brought before the
Annual Meeting.
Your vote is very important regardless of the amount of stock you own. We
hope you will attend the meeting, but whether or not you plan to be with us,
please sign and return the enclosed proxy card as soon as possible so that your
shares will be represented. I urge you to review the proxy materials carefully,
to vote FOR the director nominees and to vote FOR the proposal to approve the
Company's auditors.
Sincerely,
/s/ Louis A. Funk, Jr.
Louis A. Funk, Jr.
Chairman of the Board
<PAGE>
LOGO
NMBT CORP
55 Main Street
New Milford, Connecticut 06776-2400
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
to be held May 4, 1999 at 7:00 p.m.
--------------
To the Stockholders of NMBT CORP:
NOTICE IS HEREBY GIVEN that the Annual Meeting of Stockholders of NMBT CORP
(the "Company") will be held on Tuesday, May 4, 1999 at 7:00 p.m., at the Park
Lane Office, located at 100 Park Lane, New Milford, Connecticut, for the purpose
of considering and voting upon the following matters:
1. Election of Directors. To elect two directors to serve until the Annual
Meeting of Stockholders to be held in the year 2002, who, with the six directors
whose terms of office do not expire at this meeting, will constitute the
Company's full Board of Directors.
2. Ratification of Appointment of Auditors. To ratify the directors' appointment
of Deloitte & Touche LLP as the Company's independent auditors for the year
ending December 31, 1999.
3. Other Business. To transact such other business as may properly be brought
before the Annual Meeting and any adjournment or postponement thereof.
Only stockholders of record as of the close of business on March 5, 1999,
will be entitled to notice of and to vote at the Annual Meeting of Stockholders
and any adjournment or postponement thereof.
By Order of the Board of Directors,
NMBT CORP
Jay C. Lent
Secretary
New Milford, Connecticut
March 31, 1999
<PAGE>
LOGO
NMBT CORP
55 Main Street
New Milford, Connecticut 06776-2400
PROXY STATEMENT FOR ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD ON MAY 4, 1999 at 7:00 p.m.
INFORMATION CONCERNING THE SOLICITATION
This Proxy Statement is being furnished to the Stockholders of NMBT CORP, a
Delaware bank holding company (the "Company"), in connection with the
solicitation by the Board of Directors of the Company of proxies for use at the
Annual Meeting of Stockholders of the Company to be held on Tuesday, May 4, 1999
at 7:00 p.m. at the Park Lane Office located at 100 Park Lane, New Milford,
Connecticut, and at any adjournment or postponement thereof (the "Annual
Meeting"). The purpose of the Annual Meeting is to consider and vote upon the
following proposals: (i) to elect two directors for a three year term expiring
in the year 2002; (ii) to ratify the appointment by the Board of Directors of
Deloitte & Touche LLP as independent auditors of the Company for the year ending
December 31, 1999; and (iii) to transact such other business as may properly be
brought before the Annual Meeting and any adjournment or postponement thereof.
The principal executive offices of the Company and its subsidiary, NMBT are
located at 55 Main Street, New Milford, Connecticut 06776-2400. The telephone
number of NMBT and the Company is (860) 355-1171.
Only stockholders of record as of the close of business on March 5, 1999
(the "Record Date") will be entitled to notice of and to vote at the Annual
Meeting and each stockholder shall have one vote on all proposals to be
presented at the Annual Meeting for each share of the Company Common Stock
registered in his or her name. There is no cumulative voting. On the Record Date
2,663,358 shares of the Company Common Stock were authorized, issued and
outstanding and held by 1,819 shareholders of record.
This Proxy Statement and the enclosed Form of Proxy, along with the 1998
Annual Report to Stockholders, are first being mailed to stockholders on or
about March 31, 1999.
The enclosed proxy may be revoked at any time prior to being voted by the
submission of a written revocation or a duly executed proxy bearing a later
date, or by the stockholder's withdrawal of a previously submitted proxy and
personal vote by ballot at the Annual Meeting. Attendance at the Annual Meeting
will not in and of itself constitute the revocation of a proxy. Unless a proxy
is revoked and except as specified below, shares represented by a properly
executed proxy will be voted in accordance with any voting instructions given on
the proxy or, unless contrary instructions are given, will be voted "FOR" all
nominees listed in Proposal 1, "FOR" Proposal 2, and in accordance with the
determination of a majority of the Board of Directors as to other matters
properly brought before the Annual Meeting. On a matter for which the "ABSTAIN"
instruction is given by the Stockholder, shares will be voted neither "FOR" nor
"AGAINST."
A majority of the shares entitled to vote, present in person or represented
by proxy, constitutes a quorum of the stockholders. The presence of a quorum and
the affirmative vote of a plurality of the shares present, in person or by
proxy, entitled to vote at the Annual Meeting is required to elect directors.
The affirmative vote of a majority of the shares present, in person or by proxy,
entitled to vote at the Annual Meeting is required to approve the appointment of
the independent auditors and for the approval of most other actions which may be
taken at the Annual Meeting. Abstentions to a proposal are considered shares
present and entitled to vote, and therefore have the same legal effect as
<PAGE>
a vote against a matter presented at the Annual Meeting. Shares beneficially
held in street name are counted for quorum purposes if such shares are voted on
at least one matter to be considered at the meeting. Broker non-votes are
neither counted for purposes of determining the number of affirmative votes
required for approval of proposals nor voted for or against matters presented
for stockholder consideration. Consequently, so long as a quorum is present,
such non-votes have no effect on the outcome of any vote.
The expense of soliciting proxies will be borne by the Company. In addition
to solicitations by mail, officers and regular employees of the Company may
solicit proxies personally or by telephone, telegraph or other means without
additional compensation. The Company may reimburse brokerage firms and others
for their reasonable expenses in forwarding solicitation material to the
beneficial owners of the Company's stock held of record by such persons.
The principal officers and directors of the Company and NMBT, together with
their affiliates, beneficially owned, directly or indirectly, as of March 5,
1999, an aggregate of 314,529 shares of Company Common Stock (which number does
not include outstanding options to purchase the Company Common Stock),
constituting 11.8% of such shares outstanding and entitled to vote on that date.
Nonemployee directors own 292,910 shares of the Company Common Stock or 11.0% of
the total, and principal officers of the Company and NMBT own 21,619 of such
shares, or less than 1%.
ADDITIONAL COPIES OF THE 1998 ANNUAL REPORT TO STOCKHOLDERS AND THE 1998
ANNUAL REPORT ON FORM 10-K, INCLUDING FINANCIAL STATEMENTS AND SCHEDULES AS
FILED WITH THE SECURITIES AND EXCHANGE COMMISSION PURSUANT TO THE SECURITIES
EXCHANGE ACT OF 1934, MAY BE OBTAINED WITHOUT CHARGE UPON WRITTEN REQUEST TO:
JAY C. LENT, NMBT, 100 PARK LANE, NEW MILFORD, CONNECTICUT 06776-2400.
PRINCIPAL HOLDERS OF VOTING SECURITIES
The table below lists the only persons or groups believed by the Company to
be beneficial owners of more than five percent of any class of the Company's
voting securities as of the Record Date, March 5, 1999. In preparing the table,
the Company has relied upon information supplied to the Securities and Exchange
Commission by such persons and other information available to the Company.
<TABLE>
<CAPTION>
NUMBER OF SHARES
BENEFICIALLY OWNED
-------------------- (A) (B) (C) % OF CLASS
TITLE OF NAME AND ADDRESS OF WITH SOLE POWER WITH SHARED POWER TOTAL OF AS OF
CLASS BENEFICIAL OWNER TO VOTE AND INVEST TO VOTE AND INVEST (A) AND (B) MARCH 5, 1999 (1)
----- ---------------- ------------------ ------------------ ----------- -----------------
<S> <C> <C> <C> <C> <C>
Common Daruma Asset 198,760 0 198,760 7.46%
Management, Inc.
60 East 42nd Street
New York, NY 10165
Common Robert W. X. Martin 47,387 113,978 161,365 6.03%
42 Marwick Manor
New Milford, CT 06776
</TABLE>
- -----------------
(1) For purposes of calculation, the percent of class is determined by dividing
column (c), total number of shares beneficially owned by the sum of the
total number of voting securities issued and outstanding as of March 5,
1999 (2,663,358), plus the number of shares for which the individual or
group is deemed to be the beneficial owner because such individual has or,
where appropriate, the individuals comprising the group have the right to
acquire such shares through the exercise of stock options. Mr. Martin held
such options for 13,000 shares as of such date.
<PAGE>
STOCK OWNED BY DIRECTORS AND EXECUTIVE OFFICERS
The following table sets forth information as of March 5, 1999 with respect
to the shares of the Company Common Stock beneficially owned by each director,
each executive officer of the Company and NMBT and by all directors and
executive officers as a group:
NUMBER OF SHARES BENEFICIALLY OWNED
<TABLE>
<CAPTION>
(A) (B) (C) % OF CLASS
NAMES AND POSITION(S) WITH WITH SOLE POWER WITH SHARED POWER TOTAL OF AS OF
THE COMPANY AND NMBT(1) TO VOTE AND INVEST TO VOTE AND INVEST (A) AND (B) MARCH 5, 1999(2)
- ----------------------- ------------------ ------------------ ----------- ----------------
<S> <C> <C> <C> <C>
Carrigan, Michael D............................... 113,001(2) 1,372 114,373(2) 4.12%
President & CEO
Dumas, Kevin L.................................... 16,500(3) 13,317 29,817(3) 1.11%
Director
Fish, Deborah L................................... 0(2) 55 55(2) 0.00%
NMBT Vice President & Treasurer
Company Treasurer
Funk, Louis A., Jr................................ 14,600(3) 5,500 20,100(3) 0.75%
Chairman of the Board
Greenhaus, Lawrence............................... 25,155(3) 6,241 31,396(3) 1.17%
Vice Chairman of the Board
Henderson, Ruth................................... 54,471(3) 992 55,463(3) 2.07%
Director
Lent, Jay C....................................... 53,200(2) 0 53,200(2) 1.96%
Executive Vice President of
NMBT, Secretary & CFO
of NMBT & the Company
Maher, Peter R.................................... 47,005(2) 13,986 60,991(2) 2.25%
Executive Vice President and
Chief Lending Officer of NMBT
Martin, Robert W.X................................ 47,387(3) 113,978 161,365(3) 6.03%
Director & Assistant Secretary
Pellegrini, Terry C............................... 13,000(3) 6,019 19,019(3) 0.71%
Director
<PAGE>
Southworth, Walter G.............................. 39,063(3) 20,215 59,278(3) 2.21%
Director
Taylor, Harry H., Jr.............................. 13,840(3) 5,595 19,435(3) 0.73%
Director
Weinshank, Arthur C............................... 14,037(3) 0 14,037(3) 0.52%
Director
All directors and executive officers as a group
(13 persons)................................... 451,259(2) 187,270 638,529(2) 21.37%
</TABLE>
- ------------
(1) The Board of Directors for the Company and NMBT are the same and except
where specifically indicated, positions stated above are the same for the
Company and NMBT.
(2) For purposes of calculation, the percent of class is determined by dividing
column (c), total number of shares beneficially owned, by the sum of the
total number of voting securities issued and outstanding as of March 5, 1999
(2,663,358), plus the number of shares for which the individual or group is
deemed to be the beneficial owner because such individual has or, where
appropriate, the individuals comprising the group have the right to acquire
such shares through the exercise of stock options. The following individuals
and group held such options for the following numbers of shares as of such
date: Mr. Carrigan-110,000; Mr. Lent-50,000; Mr. Maher-47,000; and all
directors & executive officers as a group-207,000. The numbers set forth in
the above chart give effect to the options.
(3) Gives effect to options to purchase 13,000 shares of Common Stock.
<PAGE>
ELECTION OF DIRECTORS
(PROPOSAL ONE)
The Company's Bylaws provide for not less than five nor more than twelve
directorships, divided into three classes with each class being approximately
equal in size. At this Annual Meeting two Class II directors are being nominated
to serve for a term of three years until the Annual Meeting to be held in the
year 2002 and until their successors are elected and qualified. These two
directors, with the six directors remaining, will constitute the full Board. The
individuals comprising the Board of Directors of NMBT and the Company are the
same and usually hold meetings at the same time. Accordingly, references to the
Company Board and the NMBT Board are used interchangeably. Walter G. Southworth
will retire in accordance with the Bylaws as of the Annual Meeting for this year
and the Board has already determined to reduce the number of Class II
directorships to two. The Company's President, Mr. Carrigan, serves as an
ex-officio director. Shares represented by every properly executed proxy will be
voted at the 1999 Annual Meeting of Stockholders for the election of the
proposed slate of directors, except where the right to vote such shares is
withheld as provided in the proxy or otherwise instructed. The presence of a
quorum and the affirmative vote of a plurality of the shares present, in person
or by proxy entitled to vote at the Annual Meeting is required to elect
directors. All nominees are now serving as directors pursuant to their previous
election by the stockholders. Each candidate for the Board has been nominated by
the Board of Directors. The Board of Directors expect that, and each of the
nominees has indicated that, he will be available to serve as director; however,
in the event that any of them should become unavailable, it is intended that a
proxy may be voted for a nominee or nominees who would be designated by the
Board of Directors.
THE BOARD OF DIRECTORS RECOMMENDS THAT THE STOCKHOLDERS VOTE FOR THE PROPOSED
NOMINEES.
The following tables set forth the names of the Board of Directors'
nominees for election as a director and those directors who will continue to
serve after the Annual Meeting. Also set forth is certain other information with
respect to each such person's age as of March 5, 1999, the periods during which
he or she has served as a director of the Company and NMBT and positions
currently held with the Company and NMBT.
<TABLE>
<CAPTION>
EXPIRATION OF POSITION(S) HELD
DIRECTOR CURRENT WITH THE COMPANY
NOMINEES AGE SINCE TERM AND NMBT
- -------- --- ----- ---- --------
<S> <C> <C> <C> <C>
CLASS II
Robert W. X. Martin 68 1975 1999 Director and Asst. Secretary
Harry H. Taylor, Jr. 68 1993 1999 Director
DIRECTORS CONTINUING IN OFFICE
CLASS I
Kevin L. Dumas 42 1995 2000 Director
Louis A. Funk, Jr. 56 1995 2000 Director and Chairman
Lawrence Greenhaus 70 1975 2000 Director and Vice Chairman
CLASS III
Ruth Henderson 69 1975 2001 Director
Terry C. Pellegrini 55 1994 2001 Director
Arthur C. Weinshank 48 1995 2001 Director
</TABLE>
<PAGE>
BACKGROUND OF NOMINEES
Robert W.X. Martin has been a director since 1975. He was the owner of
Martin Plumbing Supply, Inc. of New Milford, Connecticut, until his retirement
in 1978.
Harry H. Taylor, Jr. has been a director since 1993. He is the owner of
H.H. Taylor & Son, a retail building materials and hardware business located in
New Milford, Connecticut.
BACKGROUND OF DIRECTORS CONTINUING IN OFFICE
Kevin L. Dumas has served on the Board of Directors since 1995. He has been
engaged in the private practice of accounting since 1986.
Louis A. Funk, Jr. has been a director since 1995. He was an owner and Vice
President of the Omaha Beef Co., Inc. of Danbury Connecticut from 1968 to 1997.
Lawrence Greenhaus has been a director since 1975. He retired in 1994 after
practicing accounting for 44 years. He was a principal in the accounting firm of
Greenhaus, Riordan & Co. located in New Milford, Connecticut.
Ruth Henderson has served on the Board of Directors since 1975. She is the
owner and operator of the Silo, a retail gourmet food and cooking business
headquartered in New Milford, Connecticut.
Terry C. Pellegrini has served on the Board of Directors since 1994. He has
been engaged in the private practice of law since 1969 and is a principal in the
law firm of Moots, Pellegrini, Spillane & Mannion, P.C.
Arthur C. Weinshank has served on the Board of Directors since 1995. He has
been engaged in the private practice of law since 1975 and is a principal in the
law firm of Cramer & Anderson LLP.
DIRECTORS' AFFILIATIONS
There are no reportable business or personal relationships or affiliations
between any director or nominee and the Company or its management. No nominee
for director serves as a director of any other company with a class of
securities registered under Section 12 of the Securities Exchange Act of 1934.
COMPENSATION OF DIRECTORS
Annual Fees and Meeting Fees. In 1998 each director who was not an employee
of the Company or NMBT received an annual directors' retainer fee of $8,500; a
stipend of $250 for each board meeting attended; and a stipend of $75 for each
committee meeting attended, except the stipend for attending Loan Committee
meetings which was $125
<PAGE>
per meeting. During 1998 the Chairman of the Board, Louis A. Funk, Jr., received
an additional stipend of $27,500 and the Chairman of the Audit and Personnel
Committees each received an additional stipend of $1,000. The Assistant
Secretary received an additional stipend of $2,500. Beginning in May, 1998,
however, the annual additional stipend for the Chairman of the Board was
increased to $30,000; the stipend for each board meeting attended was increased
to $350; and the stipend for each committee meeting (other than for Loan
Committee) attended was increased to $100. Any Director who is an employee of
the Company or NMBT receives no additional compensation for his or her service
as a member of the Board or any Board committee.
Stock Option Grants. The Company has two stock option plans which were
approved by the stockholders. The option plans are for the benefit of directors,
officers and employees of NMBT. The 1994 Option Plan currently permit grants to
directors as specified in that plan. During 1998 options to purchase 10,000
shares of Common Stock were granted to each director.
Directors Fee Deferral Plan. In 1997, the Board of Directors approved a
Directors Fee Deferral Plan whereby Directors may defer their annual fees or a
25%, 50% or 75% portion thereof. The deferred benefits are paid over a five to
fifteen year period commencing in the year following the year in which a
Director attains seventy years of age. A lump sum payment, however, is due any
Director terminated as a result of a change of control, within thirty days of
the termination. If a Director dies prior to attaining age seventy, any deferred
benefit relative to that Director is paid to the deceased Directors estate or
designated beneficiary. The Board of Directors had previously adopted a deferred
compensation plan for its Directors and certain selected executive officers of
NMBT (See Compensation Pursuant to Plans--Officers and Directors Deferred
Compensation Agreements).
BOARD OF DIRECTORS AND COMMITTEES OF THE BOARD
The Board of Directors met sixteen times during 1998. No director, nominee
or continuing director attended fewer than 75% of the aggregate of the total
number of meetings of the Board of Directors and meetings of the committees of
the Board on which he or she served (during the period for which he or she was a
director and for which he or she served on any such committees).
To assist in the discharge of its responsibilities, the Board has
subcommittees which include an Audit Committee, an Investment Committee, a Loan
Committee and a Personnel Committee.
The Audit Committee, consisting of Directors Dumas (the Committee's
Chairman), Funk, Greenhaus, Martin and Taylor met 6 times during 1998. This
Committee recommends engagement of the independent auditors, reviews the
arrangement and scope of the audit, considers comments made by the independent
auditors regarding internal accounting controls, oversees the internal auditing
function, reviews internal accounting procedures and controls with NMBT's
financial staff and reviews non-audit services provided by the Company's
independent auditors.
The Investment Committee, consisting of Directors Carrigan, Funk,
Pellegrini (the Committee's Chairman) and Weinshank, met 6 times during 1998.
The Investment Committee is responsible for overseeing the adoption, revision
and implementation of NMBT's investment and funds management policies.
The Loan Committee, consisting of Directors Carrigan, Dumas, Funk,
Greenhaus (the Committee's Chairman), Martin and Pellegrini met 20 times during
1998. The Loan Committee is responsible for overseeing the adoption, revision
and implementation of NMBT's loan policies.
The Personnel Committee, consisting of Directors Dumas, Funk, Henderson,
Martin and Weinshank (the Committee's Chairman), met 5 times during 1998. This
Committee reviews the personnel needs of NMBT and the Company with senior
management, reviews and approves recommendations on salary adjustments for
NMBT's officers and employees for submission to the Board of Directors, makes
recommendations to the Board of Directors concerning the granting of stock
options to NMBT's officers and employees, and oversees NMBT's benefits and
retirement plans.
<PAGE>
MANAGEMENT
EXECUTIVE OFFICERS
The following table sets forth certain information with respect to the
executive officers of the Company and NMBT. Messrs. Carrigan, Lent and Maher
serve pursuant to employment agreements. See "Management--Employment Contracts."
<TABLE>
<CAPTION>
AGE AT
NAME MARCH 5, 1999 POSITION(S) HELD
- ---- ------------- ----------------
<S> <C> <C>
Michael D. Carrigan 47 President and Chief Executive Officer of NMBT and the Company
Jay C. Lent 40 Executive Vice President of NMBT, Chief Financial Officer and
Secretary of NMBT and the Company
Peter R. Maher 46 Executive Vice President and Chief Lending Officer of NMBT
Deborah L. Fish 48 Vice President and Treasurer of NMBT, Treasurer of the Company
</TABLE>
Michael D. Carrigan joined NMBT on January 4, 1993, as Executive Vice
President and assumed the responsibilities of President and Chief Executive
Officer on May 6, 1993. He was formerly an Executive Vice President, Senior
Lending Officer with UST Bank/Connecticut. He became President of the Company
immediately after its inception in 1997.
Jay C. Lent joined NMBT on October 22, 1990, as Executive Vice President and
Chief Financial Officer. In June, 1993, Mr. Lent was named Secretary of NMBT.
After the creation of the Company in 1997 he was named its Secretary and CFO.
Previously, Mr. Lent was a Senior Manager with PricewaterhouseCoopers LLP, an
international accounting and consulting firm. He has also served as Senior Vice
President and Chief Financial Officer with First International Bancorp.
Peter R. Maher joined NMBT on April 19, 1993, as Senior Vice President and
Chief Lending Officer. In August, 1995 Mr. Maher was named Executive Vice
President and Chief Lending Officer. Prior to joining NMBT, Mr. Maher was a
Senior Vice President with UST Bank/Connecticut.
Deborah L. Fish joined NMBT in 1976 and has held various positions with NMBT
since that time. She was named Treasurer of NMBT in 1986 and Vice President in
1987. She was named Treasurer of the Company immediately after its inception in
1997.
EMPLOYMENT CONTRACTS
NMBT has employment agreements with Messrs. Carrigan, Lent and Maher. Their
annual salary for the period ending December 31, 1999 is $170,000, $133,900 and
$113,900, respectively. The employment agreements provide for a term of one year
expiring December 31, 1999. The agreements also provide for one year extensions
unless terminated in accordance with the terms contained therein. Any increases
in salary paid during extension periods are determined at the discretion of the
Board of Directors.
Mr. Carrigan's agreement provides for the payment of cash severance equal to
three times his average annual gross income for the previous five years, less
one dollar, upon his voluntary termination for good reason (as defined therein)
or involuntary termination other than for cause (as defined therein) within
twelve months following a "change of control" (as defined therein). If
employment is terminated for cause or if Mr. Carrigan voluntarily terminates his
employment other than in connection with a change in control, Mr. Carrigan would
be entitled to receive compensation only through the date of termination. If his
employment is terminated for any reason other than for cause, disability, death
or a change in control, then Mr. Carrigan shall be paid the greater of (i) his
salary for the months remaining in the term (as defined therein) of employment,
(ii) an amount equal to his then current monthly salary multiplied by the number
of years (not to exceed twelve) of his employment, or (iii) his salary for six
months.
<PAGE>
The agreements for Messrs. Lent and Maher, while substantially similar in
form to Mr. Carrigan's, provide for the payment of cash severance equal to two
times their average annual gross income for the previous five years, less one
dollar, upon their voluntary termination for good reason (as defined therein) or
involuntary termination within twelve months following a "change of control" (as
defined therein).
EXECUTIVE COMPENSATION
The following table sets forth the annual compensation for the last three fiscal
years for the Chief Executive Officer of the Company and NMBT and each of the
most highly compensated executive officers of the Company and NMBT whose
compensation for 1998 exceeded $100,000:
SUMMARY COMPENSATION TABLE
<TABLE>
<CAPTION>
LONG TERM
COMPENSATION
AWARDS
ANNUAL ------
COMPENSATION RESTRICTED SECURITIES ALL OTHER
FISCAL ---------------- STOCK UNDERLYING LTIP COMPENSATION
NAME AND PRINCIPAL POSITION(S) YEAR SALARY($) BONUS($) AWARDS OPTIONS(#) PAYOUTS $(1)
- ------------------------------ ---- ------------------ ------ ---------- ------- ----
<S> <C> <C> <C> <C> <C> <C> <C>
Michael D. Carrigan 1998 $165,000 $ 50,000 -- 10,000 -- $ 9,917
President, Chief Executive 1997 155,000 50,000 -- -- -- 10,517
Officer and Director of 1996 145,000 50,000 -- -- -- 9,147
NMBT & the Company
Jay C. Lent 1998 130,000 35,000 -- -- -- 8,057
Executive Vice President of NMBT, 1997 130,000 35,000 -- -- -- 11,432
Chief Financial Officer and 1996 125,000 30,000 -- -- -- 8,801
Secretary of NMBT & the Company
Peter R. Maher 1998 110,000 35,000 -- -- -- 8,119
Executive Vice President and 1997 105,000 35,000 -- -- -- 9,832
Chief Lending Officer of NMBT 1996 100,000 30,000 -- -- -- 7,835
</TABLE>
- -------------
(1) All Other Compensation consists of company contributions pursuant to NMBT's
401(k) Plan. See Compensation Pursuant to Plans-- Pension Plan.
<PAGE>
COMPENSATION PURSUANT TO PLANS
PENSION PLAN
On June 1, 1991, NMBT instituted a qualified defined contribution pension
plan pursuant to Section 401(k) of the Internal Revenue Code. Eligible
employees, those who have completed a minimum of one year of credited service,
may defer up to fifteen percent of their annual salary by contributions to the
qualified plan. NMBT matches the first 4% of an employee's contribution dollar
for dollar. NMBT has the discretion to make additional annual contributions to
the plan. An employee is vested in any amount deferred by the employee which is
contributed to the plan. NMBT's matching and discretionary contributions vest
over a 5-year period at the rate of 20% per year. Upon retirement or termination
of employment, a participant's vested account proceeds will be distributed in a
lump sum. The plan provides, in accordance with applicable laws and regulations,
for certain "hardship" withdrawals prior to termination of employment or
retirement.
The following table sets forth the years of credited service and NMBT's
contributions to the 401(k) Plan on behalf of each executive officer whose
aggregate cash compensation was more than $100,000, and as to all eligible
participating employees as a group during the prior three fiscal years:
<TABLE>
<CAPTION>
NAME OF EXECUTIVE OR NUMBER OF YEARS OF FISCAL EMPLOYER CONTRIBUTIONS
ELIGIBLE PARTICIPATING EMPLOYEES CREDITED SERVICE YEAR TO THE 401(K) PLAN
- -------------------------------- ---------------- ---- ------------------
<S> <C> <C> <C>
Michael D. Carrigan............................... 5 1998 $ 9,917
1997 10,517
1996 9,147
Jay C. Lent....................................... 8 1998 8,057
1997 11,432
1996 8,801
Peter R. Maher.................................... 5 1998 8,119
1997 9,832
1996 7,835
All eligible participating employees as a group--
(150) 1998 253,561
(133) 1997 241,660
(131) 1996 227,909
</TABLE>
STOCK OPTION PLANS
In 1988, the Board of Directors and the stockholders of NMBT adopted, and
the Connecticut Banking Commissioner approved, a Non-Statutory Stock Option Plan
for the benefit of directors, officers and employees of NMBT (the "1988 Plan")
and reserved 93,786 shares for issuance under the Plan. The 1988 Plan authorized
the granting of stock options and stock appreciation rights (SARs). Options
granted under the 1988 Plan must have been granted by the Board of Directors at
a price at or above 85% of the fair market value of a single share of the
Company's stock. Options have been granted to purchase common stock at the fair
market value at the date of the grant. The term of each option could not exceed
five years from the date of grant. No SARs have been granted under the 1988
Plan. After March 29, 1998, the termination date of the 1988 Plan, no further
options could be or were granted under the 1988 Plan.
<PAGE>
In 1994, the Board of Directors and the stockholders adopted the 1994
Non-Qualified Stock Option Plan for employees, officers and directors of NMBT
(the "1994 Plan") and reserved 300,000 shares for issuance under the 1994 Plan.
In 1998, the 1994 Plan was amended to increase the number of shares available
for issuance to 600,000. The term of each option under the 1994 Plan may not
exceed ten years from the date of its grant.
The provisions of the 1994 Plan are identical to the provisions of the 1988
Plan, except that (1) the exercise price of options granted under the 1994 Plan
may not be lower than the fair market value of the shares on the date the
options are granted, (2) a participant may exercise the options for a six-month
(rather than a three-month) period following the participant's retirement or
death, and (3) the maximum option term is ten years, rather than five years,
from the date of grant. The 1994 Plan, like the 1988 Plan, authorizes the
granting of non-qualified stock options and SARs as a means of providing an
incentive to and encouraging ownership of the Company's common stock by
employees, officers and directors; of rewarding exemplary personnel; of
assisting the Company and NMBT in the recruitment of highly qualified personnel;
and of providing a mechanism of offering incentives to employees to continually
strive to improve NMBT's products and services and their contribution to the
performance of NMBT and the Company.
Simultaneously with the reorganization of NMBT into a wholly owned
subsidiary of the Company, the 1988 and 1994 Plans were amended to require the
Company to issue the Company common stock shares under the Plans (as opposed to
NMBT common stock shares) in the event of exercises under the respective Plans.
This was necessitated by the exchange of NMBT shares for the Company shares
which was approved at the 1997 Annual Meeting and has been since effectuated.
OPTION GRANTS
During 1998, no options were granted under the 1988 Plan. During 1998, NMBT
granted 100,000 options under the 1994 Plan at $19.4375 per share. These options
were granted at their fair market value on their date of grant, June 17, 1998.
None of these options were exercised in 1998.
The following table sets forth as to each executive officer whose aggregate
compensation was more than $100,000 in 1998, certain information, concerning
grants of stock options granted during 1998.
OPTION GRANTS IN LAST FISCAL YEAR
<TABLE>
<CAPTION>
INDIVIDUAL GRANTS
- --------------------------------------------------------------------------------- VALUE AT ASSUMED
NUMBER OF PERCENT OF ANNUAL RATES OF
SECURITIES TOTAL OPTIONS STOCK PRICE
UNDERLYING GRANTED TO EXERCISE APPRECIATION
OPTIONS EMPLOYEES IN PRICE EXPIRATION FOR OPTION TERMS
GRANTED FISCAL YEAR ($ /SHARE) DATE 5% 10%
------- ----------- ---------- ---- -------------------
-- ---
<S> <C> <C> <C> <C> <C> <C> <C>
Michael D. Carrigan..... 10,000 100% $19.44 6/17/08 $122,413 $309,784
Jay C. Lent............. -- -- -- -- -- --
Peter R. Maher.......... -- -- -- -- -- --
</TABLE>
- ----------------
(1) In accordance with the rules of the SEC, the potential realizable value
over the term of the option (the period from the grant date to the
expiration date) is calculated assuming that the fair market value of the
Company Common Stock on the date of grant appreciates at the indicated
annual rate, 5% and 10% compounded annually, for the entire term of the
option and that the option is exercised and sold on the last day of its
term for the appreciated stock price. These amounts are based on certain
assumed rates of appreciation and do not represent an estimate of the
Company's future stock price. Actual gains, if any, on stock option
exercises will be dependent on the future performance of the Common Stock.
<PAGE>
No executive officer whose aggregate compensation was more than $100,000
received any grants of options under the 1988 Plan during the fiscal year ended
December 31, 1998.
OPTION EXERCISES
The following table sets forth as to each executive officer whose aggregate
compensation was more than $100,000 in 1998, certain information concerning the
exercise of stock options during the fiscal year ended December 31, 1998, and
the value of all unexercised options held by such individuals at such date (all
of the unexercised options listed below were exercisable as of December 31,
1998):
<TABLE>
<CAPTION>
AGGREGATED OPTION EXERCISES IN 1998 FISCAL
YEAR AND FISCAL YEAR-END OPTION VALUES
- --------------------------------------------------------------------------------------
NUMBER OF VALUE OF
SHARES UNEXERCISED
UNDERLYING IN-THE-
UNEXERCISED MONEY
SHARES OPTIONS AT OPTIONS AT
ACQUIRED FISCAL FISCAL YEAR-
ON VALUE YEAR-END END
NAME EXERCISE REALIZED(1) EXERCISABLE EXERCISABLE(2)
- ---- -------- ----------- ----------- -----------
<S> <C> <C> <C> <C>
Michael D. Carrigan..... 12,400 $ 161,975 110,000 $ 991,875
Jay C. Lent............. 27,000 363,250 50,000 512,500
Peter R. Maher.......... -- -- 47,000 442,125
</TABLE>
- -------------
(1) Market value of common stock at date of exercise, less the exercise price.
(2) Based on the $16.125 closing price of the Company's common stock as
reported on The Nasdaq SmallCap Market on December 31, 1998, minus the
exercise price.
OFFICERS' AND DIRECTORS' DEFERRED COMPENSATION AGREEMENTS
In 1985 and 1986, the Board of Directors of NMBT approved Deferred
Compensation Agreements for its directors and selected executive officers. These
agreements permitted the directors and selected executive officers to defer a
portion of their cash compensation for a period of four years during which time
such deferred amounts were invested by NMBT in life insurance contracts on the
lives of the directors and executives. NMBT is the beneficiary of such insurance
contracts. Directors were also permitted to enter into similar agreements with
NMBT to defer a portion of their annual retainer fees for a period of four years
during which time such deferred amounts were invested by NMBT in life insurance
contracts on the lives of such directors. The amounts to be received by the
directors are not limited to the amounts initially deferred by the directors and
invested in the life insurance contracts. NMBT is the beneficiary on such
policies which will provide NMBT with the funds to pay the benefits owed by NMBT
to the director upon the director's death, disability or when the director
reaches age 65, 68 or 70 (normal retirement age).
Distributions under the plan are payable by NMBT as either a lump sum, in a
maximum of ten equal annual installments, or in either 120 or 180 equal monthly
installments depending upon the basis for the distribution. In cases of death,
attaining normal retirement age or other terminations, lump sum distributions or
installment payments are authorized. Hardship distributions may also be
requested. Retirement distributions would occur upon the director's attaining
normal retirement age. NMBT's aggregate distributions in 1998 pursuant to this
plan totaled $254,577. As of December 31, 1998, the amount of deferred
compensation accrued under these agreements aggregated $881,320.
<PAGE>
Although NMBT may be obligated for certain cash payments prior to the
receipt of proceeds from the purchased life insurance policies under its
Deferral Compensation Agreements approved in 1985 and 1986, the actuaries have
calculated that NMBT should ultimately be reimbursed in whole from such life
insurance proceeds.
In 1997, the Board of Directors of NMBT adopted a Supplemental Executive
Retirement and Deferred Compensation Plan to provide its senior executive
officers and directors with additional retirement and tax deferral benefits to
the extent benefits under the qualified retirement plans of NMBT are limited by
applicable law or regulation. The Supplemental Plan will permit additional
deferral of compensation and matching contributions (as determined by the
Company's Personnel Committee) to the extent the supplemental deferral had been
made into NMBT's 401(k) Plan.
REPORT OF THE BOARD OF DIRECTORS ON EXECUTIVE COMPENSATION
The Board of Directors as a whole makes decisions on compensation for
executive officers (with Mr. Carrigan not participating in decisions concerning
his compensation). The Board is currently comprised of nine members. Because the
business of the Company currently consists of the business of NMBT only, no
separate cash compensation is paid to the executive officers of the Company. No
members of the Board who participate in these decisions are employed by the
Company or NMBT, neither do any of these members have an interlocking
relationship with a compensation committee of another entity, nor do they
participate in any of the Company's or NMBT's executive compensation plans.
In addition, the Personnel Committee, none of whose members are employees
of the Company or NMBT, makes recommendations to the Board of Directors
concerning the grant of stock options to employees, including director and
non-director executive employees. Based on these recommendations, the Board of
Directors makes decisions regarding the grant of any such options (with Mr.
Carrigan not participating in decisions concerning himself). This Committee also
makes recommendations to the Board of Directors on compensation for other
officers and employees and on other benefit plans for employees of the Company
and NMBT.
The Board of Directors does not have formal compensation policies. The
Board does, however, consider the Company's and NMBT's performance, the
accomplishment of business objectives, and the individual's contribution to
earnings and shareholder value in setting senior officer compensation levels.
The Board also considers the compensation paid by peer group institutions with
the goal of being competitive in the attraction and retention of qualified
executives. The two principal components of executive officers' compensation are
salary and stock options granted under the Company's 1994 Plan. The Board
considers granting bonuses only when it determines that performance is
exceptional, and only after consideration of such factors as performance for
such year compared to prior years and the time and effort exerted by management.
These decisions are made on a judgmental basis and not according to a specific
formula. The Board chose to recognize the performance by Messrs. Carrigan, Lent
and Maher in the 1998 fiscal year by the payment of a cash bonus as reflected in
the Summary Compensation Table.
Submitted by the Full Board of Directors
Michael D. Carrigan (not as to himself), Kevin L. Dumas, Louis A. Funk, Jr.,
Lawrence Greenhaus, Ruth Henderson, Robert W. X. Martin, Harry H. Taylor, Jr.,
Terry C. Pellegrini, Arthur C. Weinshank.
<PAGE>
COMPANY STOCK PERFORMANCE
The following graph shows a five-year comparison of cumulative total return
for the Company's stock (NMBT's stock prior to November 25, 1997), the Standard
& Poor's 500 Composite Index and the Nasdaq Bank Index, which is a published
industry index. Notwithstanding any statement to the contrary in any of the
Company's previous or future filings with the Securities and Exchange
Commission, the graph shall not be incorporated by reference into any such
filings.
COMPARE 5-YEAR CUMULATIVE TOTAL RETURN*
AMONG NMBT CORP, THE NASDAQ BANK
INDEX AND THE S & P 500 INDEX
[PERFORMANCE GRAPH OMITTED]
--FISCAL YEAR ENDING--
1993 1994 1995 1996 1997 1998
---- ---- ---- ---- ---- ----
COMPANY/INDEX/MARKET
NMBT CORP 100.00 102.08 165.28 215.57 350.32 287.74
PEER GROUP 100.00 99.64 148.38 195.91 328.02 324.90
S&P 500 INDEX 100.00 101.32 139.40 171.41 228.59 293.92
THE PEER GROUP CHOSEN WAS:
NASDAQ BANKING INDEX
THE BOARD MARKET INDEX CHOSEN WAS:
AN INDEX OF THE COMPANIES ON THE S&P 500
- --------
$100 invested on 12/31/93 in stock or index -- including reinvestment of
dividends.
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
During fiscal 1998, nonemployee directors Dumas, Funk, Henderson, Martin
and Weinshank served as members of the Personnel Committee which oversees the
granting of options under the 1994 Plan and the 1988 Plan. None of the Personnel
Committee members or Named Executive Officers have any relationships which must
be disclosed under this caption.
SECTION 16(A) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
Section 16(a) of the Securities Exchange Act of 1934 (the Exchange Act)
requires the Company's directors and executive officers, and holders of more
than 10% of the Company's Common Stock, to file with the Securities and Exchange
Commission (the "SEC") initial reports of ownership and reports of changes in
ownership of Company Common Stock and other equity securities of the Company.
Such officers, directors and 10% stockholders are required by SEC regulation to
furnish the Company with copies of all Section 16(a) forms they file.
Based solely on a review of such forms that it received, or written
representations from reporting persons that no other reports were required for
such persons, the Company believes that, during the year ended December 31,
1998, all Section 16(a) filing requirements were satisfied on a timely basis
except that Jay C. Lent inadvertently filed a Form 4 less than a week late
regarding an exercise of stock options and the sale of stock.
RATIFICATION OF DIRECTORS' APPOINTMENT
OF INDEPENDENT AUDITORS
(PROPOSAL TWO)
The Board of Directors has appointed the firm of Deloitte & Touche LLP as
the Company's independent auditors to serve for the fiscal year ending December
31, 1999. A representative of Deloitte & Touche LLP will be available to answer
appropriate questions at the Annual Meeting and will be afforded the opportunity
to make a statement, if he wishes to do so. Deloitte & Touche LLP is an
internationally known firm and known as one of the "Big Five" accounting firms.
The Company is being served by the Stamford, Connecticut office.
<PAGE>
In 1998, Deloitte & Touche LLP provided the Company certain services, in
addition to conducting the annual audit of the Company's financial statements.
These services consisted primarily of income tax advice, corporate tax return
preparation and audits and tax filings relative to pension plans. The Audit
Committee of the Board of Directors approved these services and considered their
possible effect on the independence of Deloitte & Touche LLP before these
services were rendered.
In the event that ratification of Deloitte & Touche LLP as the Company's
independent auditors is not obtained at the Annual Meeting, the Board of
Directors will reconsider its appointment.
REQUIRED VOTE FOR RATIFICATION OF INDEPENDENT AUDITORS
To ratify the Directors' appointment of the independent auditors, the
affirmative vote of the shares present, in person or by proxy entitled to vote
at the Annual Meeting is required.
THE BOARD OF DIRECTORS RECOMMENDS THAT THE STOCKHOLDERS VOTE "FOR"
RATIFICATION.
CERTAIN TRANSACTIONS
The Company and NMBT have had and expect to have in the future banking
transactions in the ordinary course of business with directors, officers,
stockholders and their associates. These transactions are made on substantially
the same terms, including interest rates and collateral on loans, as those
prevailing at the same time for comparable transactions with others, and do not
involve more than the normal risk of collectibility or present other unfavorable
features at the time such loans are made. The highest aggregate amount of loans
to all officers and directors of the Company and NMBT and their associates as a
group was $2,827,365 on September 1, 1998, or 10.01% of stockholders' equity.
There were no standby letters of credit to related parties outstanding at year
end.
STOCKHOLDERS' PROPOSALS FOR 2000 MEETING
To be considered for inclusion in the proxy statement relating to the
Annual Meeting of Stockholders of the Company to be held in 2000, stockholder
proposals must be received no later than November 30, 1999. To be considered for
presentation at such meeting, although not included in the proxy statement,
proposals for nominations for election to the Board of Directors must be
received no later than sixty (60) calendar days and no earlier than (90)
calendar days prior to the meeting, and all other proposals must be received no
later than February 13, 2000. All stockholder proposals should be marked for the
attention of Jay C. Lent, Secretary, NMBT CORP, 100 Park Lane, New Milford,
Connecticut, 06776-2400.
ALL OTHER MATTERS WHICH MAY COME BEFORE THE MEETING
As of the date of this Proxy Statement, the Board of Directors knows of no
business that will be presented for consideration at the meeting other than that
which has been referred to herein. As to other business, if any, that may
properly come before the meeting, the persons named in the accompanying Form of
Proxy will vote such Proxy in accordance with the determination of a majority of
the Board of Directors.
By Order of the Board of Directors,
NMBT CORP
Jay C. Lent
Secretary
New Milford, Connecticut
March 31, 1999
