SCHEDULE 14A
(Rule 14a-101)
INFORMATION REQUIRED IN PROXY STATEMENT
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the Securities
Exchange Act of 1934 (Amendment No. )
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
[X] Definitive Proxy Statement Only (as permitted by Rule 14a-6(e)(2))
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to Rule 14a-11(c) or Rule 14a-12
Salisbury Bancorp, Inc.
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(Name of Registrant as Specified in Its Charter)
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(Name of Person(s) Filing Proxy Statement, if Other Than 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)(1) and 0-11.
(1) Title of each class of securities to which transaction applies:
- --------------------------------------------------------------------------------
(2) Aggregate number of securities to which transaction applies:
- --------------------------------------------------------------------------------
(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):
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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.
<PAGE>
(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>
SALISBURY BANCORP, INC.
PROXY STATEMENT
ANNUAL MEETING OF SHAREHOLDERS
MAY 22, 1999
<PAGE>
TABLE OF CONTENTS
<TABLE>
<CAPTION>
Page
<S> <C>
NOTICE OF MEETING.....................................................................1
INTRODUCTION..........................................................................2
OUTSTANDING STOCK AND VOTING RIGHTS...................................................2
SECURITY OWNERSHIP OF DIRECTORS AND MANAGEMENT........................................3
MANAGEMENT OF THE COMPANY.............................................................4
Principal Shareholders of the Company........................................5
PROPOSAL I- ELECTION OF DIRECTORS.....................................................5
Committees of the Board of Directors.........................................7
Fees.........................................................................7
Director Attendance..........................................................8
Certain Business Relationships...............................................8
Report on Executive Compensation.............................................8
Indebtedness of Management and Others........................................9
EXECUTIVE COMPENSATION OF PRINCIPAL OFFICERS..........................................9
Summary Compensation Table...................................................9
Aggregated Options/SAR Exercises in Last Fiscal Year........................10
Insurance...................................................................10
Pension Plan................................................................10
Supplemental Retirement Arrangement.........................................12
Section 16(a) Beneficial Ownership Reporting Compliance.....................12
Stock Performance Graph.....................................................13
PROPOSAL II - RATIFICATION OF THE APPOINTMENT
OF INDEPENDENT AUDITORS.........................................................14
PROPOSAL III - OTHER BUSINESS........................................................14
SHAREHOLDER PROPOSALS ...............................................................15
SHAREHOLDER INFORMATION .............................................................15
</TABLE>
<PAGE>
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
TO BE HELD ON MAY 22, 1999
NOTICE IS HEREBY GIVEN that the Annual Meeting of Shareholders of Salisbury
Bancorp, Inc. (the "Company"), will be held at 10:00 a.m. on May 22, 1999 at the
Main Office of Salisbury Bank and Trust Company (the "Bank"), 5 Bissell Street
in Lakeville, Connecticut, for the following purposes:
1. To elect two (2) Directors for a three year term; who with the seven (7)
directors whose terms do not expire at this meeting, will constitute the
full Board of Directors of the Company and the Bank.
2. To ratify the appointment by the Board of Directors of Shatswell, MacLeod &
Company, P.C. as independent auditors for the Company for the year ending
December 31, 1999.
3. To transact such other business as may properly come before the meeting, or
any adjournment(s) thereof.
Only those Shareholders of record at the close of business on the 6th day
of April, 1999 are entitled to notice of, and to vote at this Annual Meeting or
any adjournment thereof. In order that you may be represented at the meeting,
please complete, date, sign and mail promptly the enclosed proxy for which a
postage-prepaid return envelope is provided.
BY ORDER OF THE BOARD OF DIRECTORS OF
SALISBURY BANCORP, INC.
/s/ Craig E. Toensing,
----------------------
Craig E. Toensing,
Secretary
April 15, 1999
SHAREHOLDERS ARE REQUESTED TO MARK, DATE, SIGN AND RETURN THE ENCLOSED PROXY AS
SOON AS POSSIBLE REGARDLESS OF WHETHER THEY PLAN TO ATTEND THE MEETING. ANY
PROXY GIVEN BY A SHAREHOLDER MAY BE REVOKED AT ANY TIME BEFORE IT IS EXERCISED,
AND ANY SHAREHOLDER WHO EXECUTES AND RETURNS A PROXY AND WHO ATTENDS THE ANNUAL
MEETING MAY WITHDRAW THE PROXY AT ANY TIME BEFORE IT IS VOTED AND VOTE HIS OR
HER SHARES IN PERSON. A PROXY MAY BE REVOKED BY GIVING NOTICE TO CRAIG E.
TOENSING, SECRETARY OF THE COMPANY, IN WRITING PRIOR TO THE TAKING OF A VOTE.
1
<PAGE>
SALISBURY BANCORP, INC.
PROXY STATEMENT
FOR
ANNUAL MEETING OF SHAREHOLDERS
May 22, 1999
INTRODUCTION
The enclosed proxy (the "Proxy") is solicited by the Board of Directors
(the "Board of Directors") of Salisbury Bancorp, Inc. (the "Company"), 5 Bissell
Street, Lakeville, Connecticut 06039, for use at the Annual Meeting of
Shareholders, to be held on May 22, 1999, at 10:00 a.m., at the Main Office of
its subsidiary, Salisbury Bank and Trust Company (the "Bank"), 5 Bissell Street,
Lakeville, Connecticut, and at any and all adjournments thereof. Any Proxy given
may be revoked at any time before it is actually voted on any matter in
accordance with the procedures set forth on the Notice of Annual Meeting. This
Proxy Statement and the enclosed form of Proxy are being mailed to shareholders
(the "Shareholders") on or about April 15, 1999. The cost of preparing,
assembling and mailing this Proxy Statement and the material enclosed herewith
is being borne by the Company. In addition, proxies may be solicited by
directors, officers and employees of the Company and the Bank personally by
telephone or other means. The Company will reimburse banks, brokers, and other
custodians, nominees, and fiduciaries for their reasonable and actual costs in
sending the proxy materials to the beneficial owners of the Company's common
stock (the "Common Stock").
OUTSTANDING STOCK AND VOTING RIGHTS
The Board of Directors has fixed the close of business on April 6, 1999 as
the record date (the "Record Date") for the determination of Shareholders
entitled to notice of and to vote at this Annual Meeting. As of the Record Date,
1,509,792 shares of the Company's Common Stock (par value $.10 per share) were
outstanding and entitled to vote and held of record by approximately 600
Shareholders, each of which shares is entitled to one vote on all matters to be
presented at this Annual Meeting. Votes withheld, abstentions and broker
non-votes are not treated as having voted in favor of any proposal and counted
only for purposes of determining whether a quorum is present at the Annual
Meeting.
A proxy card is enclosed for your use. YOU ARE SOLICITED ON BEHALF OF THE
BOARD OF DIRECTORS TO COMPLETE, DATE, SIGN AND RETURN THE PROXY CARD IN THE
ACCOMPANYING ENVELOPE, which is postage-prepaid if mailed in the United States.
A copy of the 1998 Annual Report to Shareholders, which includes the
consolidated financial statements of the Company for the year ended December 31,
1998, is being mailed with this proxy statement to all shareholders entitled to
vote at the Annual Meeting.
2
<PAGE>
SECURITY OWNERSHIP OF DIRECTORS AND MANAGEMENT
The following table sets forth certain information as of April 6, 1999
regarding the number of shares of Common Stock beneficially owned by each
director and officer and by all directors and officers as a group.
<TABLE>
<CAPTION>
Number of Shares (1) Percentage of Class(2)
-------------------- ----------------------
<S> <C> <C>
John R.H. Blum 15,336 (3) 1.02%
Louise F. Brown 4,224 (4) .28%
John F. Foley 3,696 (5) .24%
Gordon C. Johnson 1,002 (6) .07%
Holly J. Nelson 798 (7) .05%
John F. Perotti 10,642 (8) .70%
John E. Rogers 28,715 (9) 1.90%
Walter C. Shannon, Jr 3,444 (10) .23%
Craig E. Toensing 3,000 (11) .20%
Michael A. Varet 65,646 (12) 4.35%
- --------------------- ------- -----
(All Directors and Officers 136,503 9.04%
as a group of (10) persons)
</TABLE>
(1) The shareholdings also include, in certain cases, shares owned by or in
trust for a director's spouse and/or his children or grandchildren, and in
which all beneficial interest has been disclaimed by the director.
(2) Percentages are based upon the 1,509,792 shares of the Company's Common
Stock outstanding and entitled to vote on April 6, 1999. The definition of
beneficial owner includes any person who, directly or indirectly, through
any contract, agreement or understanding, relationship or otherwise has or
shares voting power or investment power with respect to such security.
(3) Includes 2,100 shares owned by John R. H. Blum's wife.
(4) Includes 2,136 shares owned by Louise F. Brown as custodian for her
children.
3
<PAGE>
(5) Includes 1,518 shares owned jointly by John F. Foley and his wife and 66
shares owned by John F. Foley as custodian for his children.
(6) Includes 660 shares which are owned by Gordon C. Johnson's wife and for
which Mr. Johnson has disclaimed beneficial ownership.
(7) Includes 6 shares owned by Holly J. Nelson as guardian for a minor child.
(8) Includes 9,514 shares owned jointly by John F. Perotti and his wife and
1,128 shares in trust for his children.
(9) Includes 11,370 shares owned by John E. Rogers' wife.
(10) All shares are owned individually by Walter C. Shannon, Jr.
(11) Includes 42 shares owned by Craig E. Toensing as custodian for his son.
(12) Includes 18,540 shares which are owned by Michael A. Varet's wife, 6,186
shares which are owned by his son and 12,360 shares owned by Michael A.
Varet as custodian for his children. Michael A. Varet has disclaimed
beneficial ownership for all of these shares.
MANAGEMENT OF THE COMPANY
The following table sets forth the name and age of each Executive Officer,
his principal occupation for the last five years and the year in which he was
first appointed an Executive Officer of the Company.
<TABLE>
<CAPTION>
Executive Officer
Name Age Position of the Company since:
---- --- -------- ---------------------
<S> <C> <C> <C>
John F. Perotti 52 President and 1998 (1)
Chief Executive Officer
Craig E. Toensing 61 Secretary 1998 (2)
John F. Foley 48 Chief Financial Officer 1998 (3)
</TABLE>
- ------------------
(1) Mr. Perotti is the President and Chief Executive Officer of the Bank and
has been an Executive Officer of the Bank since 1982.
(2) Mr. Toensing is the Senior Vice President and Trust Officer of the Bank and
has been an Executive Officer of the Bank since 1982.
(3) Mr. Foley is Vice President, Comptroller and Principal Financial Officer of
the Bank and has been an Executive Officer of the Bank since 1986.
4
<PAGE>
Principal Shareholders of the Company
As of April 6, 1999, management was not aware of any person (including any
"group" as that term is used in Section 13(d)(3) of the Exchange Act) who owns
beneficially more than 5% of the Company's Common Stock.
PROPOSAL I
ELECTION OF DIRECTORS
The Certificate of Incorporation and Bylaws of the Company provide for a
Board of Directors of not less than seven (7) members, as determined from time
to time by resolution of the Board of Directors. The Board of Directors of the
Company is divided into three (3) classes as nearly equal in number as possible.
Classes of directors serve for staggered three (3) year terms. A successor class
is to be elected at each annual meeting of shareholders when the terms of office
of the members of one class expire. Vacant directorships may be filled, until
the expiration of the term of the vacated directorship, by the vote of a
majority of the directors then in office. The Company does not have a nominating
committee but has a prescribed procedure for shareholders to make a nomination
set forth in the Company's Bylaws.
There are two (2) directorships on the Board of Directors which are up for
election this year and the following individuals have been nominated by the
Board of Directors to serve for a three (3) year term: John R. H. Blum and
Louise F. Brown. The two (2) nominees are members of the present Board of
Directors. Unless otherwise directed, the enclosed proxy will be voted "FOR"
such nominees. In the event any one or more nominees is unable or declines to
serve (events which are not anticipated), the persons named in the proxy may
vote for some other person or persons.
The following table sets forth certain information, as of April 6, 1999,
with respect to the directors of the Company and the Bank.
<TABLE>
<CAPTION>
Positions Held Director Term
Name Age with the Company Since Expiring
---- --- ---------------- ----- --------
<S> <C> <C> <C>
John R. H. Blum 69 Chairman 1998 1999
Louise F. Brown 55 Director 1998 1999
Gordon C. Johnson 64 Director 1998 2000
Holly J. Nelson 45 Director 1998 2000
John E. Rogers 69 Director 1998 2000
Walter C. Shannon, Jr. 63 Director 1998 2000
</TABLE>
5
<PAGE>
<TABLE>
Positions Held Director Term
Name Age with the Company Since Expiring
---- --- ---------------- ----- --------
<S> <C> <C> <C> <C>
John F. Perotti 52 President,
Chief Executive Officer
and Director 1998 2001
Craig E. Toensing 61 Secretary and Director 1998 2001
Michael A. Varet 57 Director 1998 2001
</TABLE>
Presented below is additional information concerning the directors of the
Company. Unless otherwise stated, all directors have held the positions
described for at least five years.
John R. H. Blum is an attorney in private practice and former Commissioner
of Agriculture for the State of Connecticut. He has been a director of the Bank
since 1995 and was elected Chairman of the Board of Directors of the Company and
the Bank in 1998.
Louise F. Brown has been a director of the Bank since 1992 and is a partner
at the Sharon office in the law firm of Gager & Peterson.
Gordon C. Johnson has been a director of the Bank since 1994 and is a
Doctor of Veterinary Medicine.
Holly J. Nelson has been a director of the Bank since 1995 and is a partner
in the store Oblong Books and Music, LLC.
John E. Rogers has been a director of the Bank since 1964 and retired as
Chairman of the Board of the Bank in 1984. He also served as President of the
Bank from 1969 to 1981.
Walter C. Shannon, Jr. is President of Wagner McNeil, Inc. and President of
William J. Cole Agency, Inc. He has been a director of the Bank since 1993.
John F. Perotti is President and Chief Executive Officer of the Company and
the Bank. Prior to that he served as Executive Vice President and Chief
Operating Officer of the Bank, and prior to that he was Vice President and
Treasurer of the Bank. He has been a director of the Bank since 1985.
Craig E. Toensing has been a director of the Bank since 1995 and is Senior
Vice President and Trust Officer of the Bank.
Michael A. Varet has been a partner in the law firm of Piper and Marbury,
L.L.P. since 1995. Prior to 1995, Mr. Varet was a member and Chairman of Varet &
Fink, P.C., formerly Milgrim, Thomajan & Lee, P.C. Mr. Varet has been a director
of the Bank since 1997.
6
<PAGE>
Committees of the Board of Directors
The Board of Directors of the Company currently has five (5) standing
committees: Executive, Loan, Trust Investment, Audit and ALCO/Investment. The
members of the committees are appointed by the Board of Directors.
The Executive Committee has general supervision over the affairs of the
Company between meetings of the Board of Directors. In addition, while the
Company does not have a compensation committee, the Executive Committee performs
this task. All executive officers are excused from meetings of the Executive
Committee when votes are taken on their compensation packages. The members of
the Executive Committee include John R. H. Blum, John F. Perotti, John E.
Rogers, Walter C. Shannon, Jr. and Craig E. Toensing.
The Loan Committee has full authority over all loans and loan related
transactions. Its members are John R. H. Blum, John F. Perotti, John E. Rogers,
Walter C. Shannon, Jr. and Craig E. Toensing. In addition, Louise F. Brown,
Gordon C. Johnson, Holly J. Nelson and Michael A. Varet are alternates.
The Trust Investment Committee reviews the administration of and
investments made by the Bank in all of its trust accounts. Its members are
Louise F. Brown, John F. Perotti, John E. Rogers, Walter C. Shannon, Jr. and
Craig E. Toensing.
The Audit Committee reviews the internal auditor's report of the operating
staff's compliance with operating policies and procedures. Its members are
Louise F. Brown, Gordon C. Johnson, Holly J. Nelson and Michael A. Varet.
The ALCO/Investment Committee implements and monitors compliance regarding
asset and liability management practices with regard to interest rate risk,
liquidity, capital and investments as set in accordance with policies
established by the Board of Directors. Its members are John R. H. Blum, Holly J.
Nelson, John F. Perotti, Walter C. Shannon, Jr. and Craig E. Toensing.
The Board of Directors met thirteen (13) times during 1998. The Executive
Committee met ten (10) times, the Loan Committee met twenty-eight (28) times,
the Trust Investment Committee met twelve (12) times, the Audit Committee met
seven (7) times, and the ALCO/Investment Committee met six (6) times in 1998.
Fees
During 1998, directors received $300 for each Board of Directors
meeting attended and $100 for each committee meeting attended. Beginning January
1999, each director will receive an annual retainer of $2,000 and $500 for each
meeting of the Board of Directors attended. In addition, members of various
committees of the Company's Board of Directors will receive a fee of $200 for
each committee meeting attended. Directors Perotti and Toensing received no
additional compensation for their services as members of any board committee
during 1998 and in 1999 will not receive any additional compensation for their
services as directors.
7
<PAGE>
Director Attendance
During 1998 no director attended fewer than 75% of the aggregate of (1) the
total number of meetings of the Company's Board of Directors which he/she was
entitled to attend, and (2) the total number of meetings held by all committees
of the Company's Board of Directors on which he/she served.
Certain Business Relationships
John R. H. Blum is Chairman of the Board of Directors and an attorney
engaged in the private practice of law who represented the Company during 1998
and which the Company proposes to engage in 1999 in connection with certain
legal matters.
Louise F. Brown is a director of the Company and a partner in the law firm
of Gager & Peterson, which represented the Company during 1998 and which the
Company proposes to engage in 1999 in connection with certain legal matters.
Walter C. Shannon, Jr. is a director of the Company and the President of
Wagner McNeil, Inc. which serves as the insurance agent for many of the
Company's insurance needs.
Report on Executive Compensation
The Executive Committee determines the amount of annual compensation to be
paid to the Company's executive officers. One of the ways by which compensation
of executive officers is determined is by evaluating the individual officer's
performance in relation to meeting the Company's strategic goals.
The Executive Committee reviewed John F. Perotti's performance and
determined that he either met or exceeded each of the Company's strategic
objectives. Additionally, Mr. Perotti's salary was compared against the
Company's competitors' salaries for chief executive officers based upon
performance growth. Mr. Perotti's annual cash compensation for the fiscal year
ended December 31, 1998 included a base salary of $141,984, a bonus of $19,700
and total director's fees of $4,500. Mr. Perotti was not present during the
discussions which took place by the Executive Committee concerning his
compensation. The Executive Committee presented its recommendation regarding
salary for executive officers and the determinative factors used to the full
Board of Directors, without the executive officers present. The Board of
Directors unanimously accepted the Executive Committee's decision regarding
executive compensation.
This report is respectfully submitted by the members of the Executive
Committee.
John R. H. Blum
John F. Perotti
John E. Rogers
Walter C. Shannon, Jr.
Craig E. Toensing
8
<PAGE>
Indebtedness of Management and Others
Some of the directors and executive officers of the Company and the Bank,
as well as firms and companies with which they are associated, are or have been
customers of the Bank and as such have had banking transactions with the Bank.
As a matter of policy, loans to directors and executive officers are made in the
ordinary course of business on substantially the same terms, including interest
rates, collateral and repayment terms, as those prevailing at the time for
comparable transactions with other persons and do not involve more than the
normal risk of collectibility or present other unfavorable features.
Since January 1, 1998, the highest aggregate outstanding principal amount
of all loans extended by the Bank to its directors, executive officers and all
associates of such persons as a group was $2,029,564 or an aggregate principal
amount equal to 9.13% of the equity capital accounts of the Bank.
EXECUTIVE COMPENSATION OF PRINCIPAL OFFICERS
The following table provides certain information regarding the compensation
paid to certain executive officers of the Company for services rendered in all
capacities during the fiscal years ended December 31, 1998, 1997 and 1996. No
other current executive officer of the Company received cash compensation in
excess of $100,000.
Summary Compensation Table
<TABLE>
<CAPTION>
Annual Long-Term
Compensation Compensation
Securities Underlying
Options/ All Other
Name and Principal SARs Compensation
Position Year Salary($) Bonus($) (#)(1) ($)(2)
- --------------------------- ---------- --------------- -------------- -------------------------- -----------------
<S> <C> <C> <C> <C> <C>
John F. Perotti 1998 $141,984 $19,700 _____ $4,500(3)
President and 1997 135,864 25,092 1,710 6,000(3)
Chief Executive Officer 1996 128,760 3,247 1,782 3,900(3)
Craig E. Toensing 1998 $104,856 $15,249 _____ $4,500(3)
Secretary of the Company 1997 100,320 19,297 1,266 5,700(3)
Senior Vice President 1996 96,000 2,435 1,344 3,300(3)
and Trust Officer of the Bank
</TABLE>
- -----------------------
(1) The number of shares presented represent options to acquire shares of
common stock of the Company.
(2) Compensation above does not include accrual of benefits under the Bank's
defined pension plan or supplemental retirement arrangement described
below.
(3) Directors fees paid.
9
<PAGE>
In 1988, the Bank adopted an Employee Stock Purchase Plan under Section 423
of the Internal Revenue Code of 1986 for the benefit of its eligible employees.
It was designed to provide employees with an opportunity to have a stake in the
long term future of the Bank by purchasing its stock. Under the plan, the Bank
could grant options to employees and the Bank received no cash payments in
connection with the grant of options under the plan. The grant of stock options
could be made to all employees who had completed one year of service. The
exercise price of the options on the date of the grant was equal to 85% of the
fair market value of the stock on the date of the grant. All employees granted
options had the same rights and privileges. Each option provided that the
employee could purchase a number of shares of Common Stock for an aggregate
purchase price equal to a percentage of compensation as determined by the
Compensation Committee (which was uniform for all employees and could not exceed
10%). The Employee Stock Purchase Plan was terminated effective December 31,
1997.
Aggregated Options/SAR Exercises in Last Fiscal Year
<TABLE>
<CAPTION>
Shares Acquired Value Realized
Name on Exercise (#) (1) ($)(2)
---- ------------------- ------
<S> <C> <C>
John F. Perotti 1,710 $ 2,394.00
Craig E. Toensing 1,266 $ 1,772.40
</TABLE>
- -------------------------
(1) The number of shares presented represent options to acquire shares of
common stock of the Company.
(2) Value realized is the difference between the fair market value of the
Company's common stock on the date exercised and the exercise price of the
options exercised.
Insurance
In addition to the cash compensation paid to the executive officers of the
Company and the Bank, the executive officers receive group life, health,
hospitalization and medical insurance coverage. However, these plans do not
discriminate in scope, term, or operation, in favor of officers or directors of
the Company and the Bank and are available generally to all full-time employees.
Pension Plan
The Bank maintains a non-contributory defined pension plan for officers and
other salaried employees of the Bank who become participants after attaining age
21 and completing one year of service.
10
<PAGE>
<TABLE>
<CAPTION>
PENSION PLAN TABLE
Average
Base Salary Estimated Annual Retirement Benefit With
at Retirement Years of Service at Retirement Indicated
- ------------- ----------------------------------------
15 Years 20 Years 25 Years 30 Years 35 Years
-------- --------- -------- -------- --------
<S> <C> <C> <C> <C> <C>
80,000 24,000 32,000 40,000 42,000 44,000
90,000 27,000 36,000 45,000 47,250 49,500
100,000 30,000 40,000 50,000 52,500 55,000
110,000 33,000 44,000 55,000 57,750 60,500
120,000 36,000 48,000 60,000 63,000 66,000
130,000 39,000 52,000 65,000 68,250 71,500
140,000 42,000 56,000 70,000 73,500 77,000
150,000 45,000 60,000 75,000 78,750 82,500
160,000 48,000 64,000 80,000 84,000 88,000
</TABLE>
Pension benefits are based upon average base salary (determined as of each
January 1st) during the highest five consecutive years of service prior to
attaining normal retirement date. The amount of annual benefit is fifty percent
(50%) of average base salary less fifty percent (50%) of the primary Social
Security benefit, pro rated for less than 25 years of service, plus one-half of
one percent (.5%) of average base salary for each of up to ten additional years
of service. This benefit formula may be modified to conform with changes in the
pension laws.
The present average base salary and years of service to date of Messrs.
Perotti and Toensing are: Mr. Perotti: $141,507; 26 years; Mr. Toensing:
$106,481; 18 years. The above table shows estimated annual retirement benefits
payable at normal retirement date as a straight life annuity for various average
base salary and service categories before the offset of a portion of the primary
Social Security benefit.
11
<PAGE>
Supplemental Retirement Arrangement
In 1994, the Bank entered into a supplemental retirement arrangement (the
"Supplemental Retirement Agreement") with John F. Perotti. Following disability
or retirement at the earlier of the age of 65, or after thirty (30) years of
service to the Bank, Mr. Perotti will receive monthly payments of $1,250
(adjusted annually to reflect the lesser of a 5% increase or "The Monthly
Consumer Price Index for All Urban Consumers, United States City Average, All
Items" published by the Bureau of Labor Statistics) for a period of ten (10)
years. These payments are in addition to any payments under the Bank's
retirement plan. The Supplemental Retirement Agreement includes provisions which
would prevent Mr. Perotti from working for a competitor in the proximity of the
Bank.
Section 16(a) Beneficial Ownership Reporting Compliance
Section 16(a) of the Securities Exchange Act of 1934, as amended, requires
the Company's executive officers, directors and persons who own more than ten
percent (10%) of the Company's Common Stock, to file with the Securities and
Exchange Commission (the "SEC") reports of ownership and changes in ownership of
the Company's Common Stock. Executive officers, directors and any shareholders
owning greater than ten percent (10%) of the Company's Common Stock are required
by the SEC's regulations to furnish the Company with copies of all such reports
that they file.
Based solely on a review of copies of reports filed with the SEC since
August 24, 1998 and of written representations by certain executive officers and
directors, all persons subject to the reporting requirements of Section 16(a)
filed the required reports on a timely basis.
12
<PAGE>
Stock Performance Graph
Prior to August 24, 1998, the Common Stock of the Bank was traded only
infrequently and no substantial public market for the stock existed. The Bank
Common Stock was not quoted on the Nasdaq Inter-dealer Quotation System. Some
trading did take place however, in the over-the-counter market, where the stock
was traded as a non-Nasdaq issue. The stock had several market makers who listed
the issue in the National Bureau "Pink Sheets", an inter-dealer quotation
system. The Bank had the bulletin board quotation symbol "SBTL." Those trades
which occurred may not provide a reliable indication of the market value of the
Bank Common Stock, as only a limited trading market existed, and the market
price may be substantially affected by the relatively insubstantial volume of
transactions. On August 24, 1998 each share of Bank Common Stock was exchanged
for six shares of Company Common Stock and the stock began trading on the
American Stock Exchange under the symbol "SAL".
The Stock Performance Graph compares the yearly percentage change in the
cumulative total shareholder return on the Company's Common Stock against both a
broad-market index ("AMEX") and an industry index (SNL < $250M Bank Asset-Size
Index), for the five year period from December 31, 1993 through December 31,
1998. The graph assumes that on December 31, 1993 $100.00 was invested in Common
Stock of the Company and that dividends were reinvested. The following Stock
Performance Graph reflects the six for one stock exchange:
[GRAPH OMITTED]
<TABLE>
<CAPTION>
Period Ending
--------------------------------------------------------------------------------------
Index 12/31/93 12/31/94 12/31/95 12/31/96 12/31/97 12/31/98
- ---------------------------------------- -------------- ------------- ------------- ------------ ------------- -------------
<S> <C> <C> <C> <C> <C> <C>
Salisbury Bancorp, Inc. 100.00 123.18 131.50 194.06 263.28 414.96
SNL <$250M Bank Asset-Size Index 100.00 106.82 150.22 189.79 309.70 294.39
AMEX Major Market Index 100.00 108.57 149.06 190.20 243.18 292.96
</TABLE>
13
<PAGE>
THE BOARD OF DIRECTORS RECOMMENDS A VOTE "FOR" THE PROPOSAL TO ELECT
THE TWO (2) NOMINEES TO THE BOARD OF DIRECTORS FOR A TERM OF THREE (3) YEARS.
DIRECTORS ARE ELECTED BY A PLURALITY OF THE VOTES CAST BY THE SHARES ENTITLED TO
VOTE AT THE MEETING. PROXIES SOLICITED BY THE BOARD OF DIRECTORS WILL BE SO
VOTED UNLESS SHAREHOLDERS SPECIFY A CONTRARY CHOICE ON THE PROXY CARD.
PROPOSAL II
RATIFICATION OF THE APPOINTMENT
OF INDEPENDENT AUDITORS
Shareholders are asked to consider and ratify the appointment by the Board
of Directors of Shatswell, MacLeod & Company, P.C. as independent auditors to
audit the consolidated financial statements of the Company for the fiscal year
ending December 31, 1999. Representatives of the firm Shatswell, MacLeod &
Company, P.C. are not expected to attend the Annual Meeting.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE "FOR" THE RATIFICATION OF PROPOSAL
(2). PROXIES SOLICITED BY THE BOARD OF DIRECTORS WILL BE SO VOTED UNLESS
SHAREHOLDERS SPECIFY A CONTRARY CHOICE ON THE PROXY CARD. THE PROPOSAL TO RATIFY
THE APPOINTMENT OF SHATSWELL, MACLEOD & COMPANY, P.C. WILL BE APPROVED IF THE
AFFIRMATIVE VOTES CAST EXCEED THE VOTES CAST OPPOSING THE TRANSACTION.
PROPOSAL III
OTHER BUSINESS
The Company is not aware of any business to be acted upon at the Annual
Meeting other than that which is discussed in this Proxy Statement. In the event
that any other business requiring a vote of the Shareholders is properly
presented at the meeting, the holders of the proxies will vote your shares in
accordance with their best judgment.
You are encouraged to exercise your right to vote by marking the
appropriate boxes and dating and signing the enclosed proxy card. The proxy card
may be returned in the enclosed envelope, postage-prepaid if mailed in the
United States. In the event that you are later able to attend the Annual
Meeting, you may revoke your proxy and vote your shares in person. A prompt
response will be helpful and your cooperation is appreciated.
14
<PAGE>
SHAREHOLDER PROPOSALS
Shareholders of the Company who desire to present a proposal for action at
the 2000 Annual Meeting of the Company, must present the proposal to the Company
at its principal executive offices on or before January 3, 2000 for inclusion in
the Company's proxy statement and form of proxy relating to that meeting.
SHAREHOLDER INFORMATION
The Company's Annual Report on Form 10-K for the year ended December 31,
1998 is filed with the SEC and may be obtained without charge by any shareholder
upon written request to:
John F. Foley, Chief Financial Officer
Salisbury Bancorp, Inc.
P. O. Box 1868
Lakeville, Connecticut 06039-1868
The Company's 1998 Annual Report accompanies this document and is not
incorporated by reference.
April 15, 1999
15
<PAGE>
PROXY FOR ANNUAL MEETING OF SALISBURY BANCORP, INC.
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF
DIRECTORS OF SALISBURY BANCORP, INC.
The undersigned holder(s) of the Common Stock of Salisbury Bancorp, Inc.
(the "Company") do hereby nominate, constitute and appoint Gordon C. Johnson and
Walter C. Shannon, Jr., jointly and severally, proxies with full power of
substitution, for us and in our name, place and stead to vote all the Common
Stock of the Company, standing in our name on its books on April 6, 1999 at the
Annual Meeting of its Shareholders to be held at the Main Office of the Company,
5 Bissell Street, Lakeville, Connecticut on May 22, 1999 at 10:00 a.m. or at any
adjournment thereof with all the powers the undersigned would possess if
personally present, as follows:
THE BOARD OF DIRECTORS RECOMMENDS A VOTE "FOR" PROPOSALS (1) THROUGH (3)
(1) ELECT THE FOLLOWING TWO (2) PERSONS TO SERVE AS DIRECTORS OF THE COMPANY
WHO ALONG WITH SEVEN DIRECTORS WHOSE TERMS DO NOT EXPIRE AT THIS MEETING
(THE "CONTINUING DIRECTORS") SHALL CONSTITUTE THE BOARD OF DIRECTORS OF THE
COMPANY: John R. H. Blum and Louise F. Brown.
[ ]For both nominees [ ] Vote withheld from both nominees [ ] Vote withheld from
nominees listed below
=================================================+==============================
(2) RATIFICATION OF THE APPOINTMENT OF INDEPENDENT AUDITORS: Proposal to ratify
the resolution adopted by the Board of Directors appointing the independent
public accounting firm of Shatswell, MacLeod & Company, P.C. as independent
auditors of the Company for the fiscal year ending December 31, 1999.
[ ] FOR [ ] AGAINST [ ] ABSTAIN
(3) OTHER BUSINESS: Proposal to conduct whatever other business may properly be
brought before the meeting or any adjournment thereof. Management at
present knows of no other business to be presented by or on behalf of the
Company or its Management at the meeting. However, if any other matters are
properly brought before the meeting, the persons named in this proxy or
their substitutes will vote in accordance with their best judgment.
[ ] FOR [ ] AGAINST [ ] ABSTAIN
THIS PROXY WILL BE VOTED IN ACCORDANCE WITH THE SPECIFICATION INDICATED. IF NO
SPECIFICATION IS INDICATED, THIS PROXY WILL BE VOTED "FOR" PROPOSALS (1) THROUGH
(3)
Dated Dated
- ------------------------- ---------- ------------------------ ----------
(Signature) (Signature)
- ------------------------- ---------- ------------------------ ----------
(Please print your name here) (Please print your name here)
All joint owners must sign. When signing as attorney, executor,
administrator, trustee or guardian, please give full title. If more than one
trustee, all must sign.
THIS PROXY MAY BE REVOKED AT ANY TIME PRIOR TO THE MEETING BY WRITTEN NOTICE
TO THE COMPANY OR MAY BE WITHDRAWN AND YOU MAY VOTE IN PERSON SHOULD YOU
ATTEND THE ANNUAL MEETING
Please check below if you plan to attend the Annual Meeting.
[ ] I plan to attend the Annual Meeting
May 22, 1999
