<PAGE>
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:
[X] Preliminary Proxy Statement [_] Confidential, for Use of the
Commission Only (as permitted by
Rule 14a-6(e)(2))
[_] Definitive Proxy Statement
[_] Definitive Additional Materials
[_] Soliciting Material Pursuant to Section 240.14a-11(c) or Section 240.14a-12
CHITTENDEN CORPORATION
-----------------------------------------------------------
(Name of Registrant as Specified In Its Charter)
-----------------------------------------------------------
(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)(4) 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):
(4) Proposed maximum aggregate value of transaction:
(5) Total fee paid:
[_] 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:
(2) Form, Schedule or Registration Statement No.:
(3) Filing Party:
(4) Date Filed:
Notes:
<PAGE>
NOTICE OF 1998
ANNUAL MEETING
AND
PROXY STATEMENT
Your Vote is Important
Every Stockholder should complete, sign, date and promptly return the proxy in
the envelope furnished for this purpose. It is necessary that enough shares be
represented by proxy to constitute, with the shares present in person, a legal
quorum (a majority of the issued and outstanding stock) so that a meeting can be
held.
LOGO CHITTENDEN
CORPORATION
<PAGE>
Notice of Annual Meeting of Stockholders
The Annual Meeting of the Stockholders of Chittenden Corporation will be held on
April 15, 1998 at 4:00 p.m. in the Adirondack Ballroom (A & B) at the Radisson
Hotel Burlington, located at 60 Battery Street, Burlington, Vermont. The annual
meeting is for the purpose of considering and acting upon:
1. The election of Directors as provided by the By-Laws.
2. Ratification of the 1998 Directors' Omnibus Long-Term Incentive
Plan.
3. Any other business which may properly come before the meeting
or any adjournment thereof.
By order of the Board of Directors.
F. Sheldon Prentice
Secretary
March 13, 1998
2
<PAGE>
CHITTENDEN CORPORATION
Two Burlington Square
Burlington, Vermont 05401
March 13, 1998
Proxy Statement
ANNUAL MEETING OF STOCKHOLDERS TO BE HELD
APRIL 15, 1998
Solicitation and Revocation of Proxies
This proxy statement is furnished to the Stockholders of CHITTENDEN
CORPORATION (the "Corporation"), a corporation organized under the laws of the
State of Vermont, in connection with the annual meeting of the Stockholders of
the Corporation to be held on Wednesday, April 15, 1998, at 4:00 p.m., in the
Adirondack Ballroom (A & B) in the Radisson Hotel Burlington, located at 60
Battery Street, Burlington, Vermont.
A proxy card is furnished by the Corporation. This proxy is being solicited
by the Board of Directors of the Corporation for use at the April 15, 1998
annual meeting of its Stockholders and at any adjournment thereof. A proxy duly
executed and returned by a Stockholder will be voted as directed by the proxy,
and, if no choice is specified, the proxy will be voted in accordance with the
recommendations of the Board of Directors contained herein. As to other matters,
if any, to be voted upon, the persons named in the proxy will take such action
as the Board of Directors may deem advisable.
A Stockholder who signs and returns a proxy may revoke it at any time
before it is exercised by notifying the Secretary of the Corporation in writing
or by attending the meeting and voting in person.
This Proxy Statement, the Corporation's Summary Annual Report and its Form
10-K, will be mailed on or about March 13, 1998 to Stockholders of record on
February 27, 1998. The Annual Report and Form 10-K are not to be regarded as
proxy soliciting material.
All expenses of the solicitation of proxies are being borne by the
Corporation. It is expected that solicitations will be made primarily by mail,
but regular employees or representatives of the Corporation may also solicit
proxies by telephone, telegraph and in person and arrange for nominees,
custodians and fiduciaries to forward proxies and proxy material to their
principals at the expense of the Corporation. The Corporation also has retained
Kissel-Blake Inc. to assist with the solicitation of proxies for a fee of $5,000
plus reimbursement of out-of-pocket expenses.
<PAGE>
Voting Securities
The Board of Directors of the Corporation has fixed the close of business
on February 27, 1998 as the record date for the determination of Stockholders
entitled to notice of and to vote at the annual meeting. Each share of common
stock will be entitled to one vote. There are no rights of appraisal or similar
rights of dissenters with respect to any matter to be acted upon.
As of January 30, 1998 there were 14,452,457 shares of common stock
outstanding and entitled to vote. Security ownership of the Corporation's
Directors and Executive Officers is provided below in tabular form.
<TABLE>
<CAPTION>
===========================================================================================================================
(1) Title of Class (2) Name of beneficial owner (3) Amount and nature of beneficial ownership (4)Percent of class
<S> <C> <C> <C>
- ---------------------------------------------------------------------------------------------------------------------------
Common Stock Bertrand, Frederic H. 6,109 Direct .042
- ---------------------------------------------------------------------------------------------------------------------------
Common Stock Boardman, David M. 32,356 Direct .225
- ---------------------------------------------------------------------------------------------------------------------------
Common Stock Carrara, Paul J. 4,690 Direct .032
- ---------------------------------------------------------------------------------------------------------------------------
Common Stock Driscoll, Richard D. 125 Direct .001
- ---------------------------------------------------------------------------------------------------------------------------
Common Stock Hutton, Lyn 338 Direct .002
- ---------------------------------------------------------------------------------------------------------------------------
Common Stock Kolvoord, Philip A. 4,151 Direct
1,636 Indirect (Spouse) .040
- ---------------------------------------------------------------------------------------------------------------------------
Common Stock Perrault, Paul A. 11,123 Direct
42,911 Indirect (Spouse) .374
- ---------------------------------------------------------------------------------------------------------------------------
Common Stock Pizzagalli, James C. 80,628 Direct
571 Indirect (Son) (Beneficial
ownership of these shares is disclaimed)
148,925 held by Pizzagalli Brothers Company,
an entity controlled by James Pizzagalli
6,330 held by Pizzagalli Construction an
entity controlled by James Pizzagalli
1.632
- ---------------------------------------------------------------------------------------------------------------------------
Common Stock Spera, Pall D. 25,269 Direct .175
- ---------------------------------------------------------------------------------------------------------------------------
Common Stock Wilson, Martel D., Jr. 15,717 Direct
2,853 Direct (Self Directed IRA)
1,781 Indirect (Self Directed IRA Spouse) .141
- ---------------------------------------------------------------------------------------------------------------------------
Common Stock DeShaw, Lawrence W. 20,734 Direct .143
- ---------------------------------------------------------------------------------------------------------------------------
Common Stock Kelly, John W. 10,665 Direct .074
- ---------------------------------------------------------------------------------------------------------------------------
Common Stock O'Brien, Danny H. 12,553 Direct .087
- ---------------------------------------------------------------------------------------------------------------------------
Common Stock Walters, Kirk W. 6,275 Direct .043
- ---------------------------------------------------------------------------------------------------------------------------
Common Stock Others Officers of
the Corporation
61,484 Direct .425
===========================================================================================================================
</TABLE>
2
<PAGE>
Notes Regarding Directors' Stock Ownership
Beneficial ownership is determined in accordance with Rule 13(d)(3) under
the Securities Exchange Act of 1934. Unless otherwise indicated, the listed
persons have sole voting power and sole investment power with respect to the
shares of common stock set forth.
No one is the beneficial owner of more than five percent of any class of
the Corporation's voting securities, except Estabrook Capital Management and
John G. Ogilvie. This information was supplied to the Corporation on Schedule
13G pursuant to the Securities Exchange Act of 1934.
<TABLE>
<CAPTION>
=======================================================================================================================
<S> <C> <C> <C>
(1) Title of Class (2) Name and address of beneficial (3) Amount and (4) Percent of Class
owner nature of beneficial
Ownership
- -----------------------------------------------------------------------------------------------------------------------
Common Stock Estabrook Capital Management 873,486 6.06%
430 Park Avenue, Suite 1800
New York, New York 10022
John G. Ogilvie 747,506 5.18%
1075 Park Avenue
New York, New York 10028
=======================================================================================================================
</TABLE>
The Corporation's principal subsidiary, Chittenden Trust Company (the
"Bank"), held in a fiduciary or representative capacity, in the aggregate,
approximately 953,424 shares, or 6.6 percent, of the outstanding shares of
common stock of the Corporation as of December 31, 1997. The Corporation and the
Bank disclaim beneficial ownership of these shares.
Election of Directors of Chittenden Corporation
(Item 1 on Proxy Card)
Classified Board of Directors
The number of Directors, which is presently set at ten, is established
periodically by the Board. All Directors are elected for staggered three-year
terms so that approximately one third of the Directors are elected at each
annual meeting. At the annual meeting four Directors will stand for election to
serve for a term of three years.
It is the intention of the persons named in the proxy to vote for the
nominees named for the terms indicated.
Election of Directors requires a majority vote. The four nominees for
Directors and the six continuing Directors are listed on the following pages
with brief statements of their principal occupations and other information. All
of the nominees are serving currently on the Board of Directors of the
Corporation
3
<PAGE>
Director Nominees
The following persons have been nominated to serve as Directors for terms to
expire in 2001.
FREDERIC H. BERTRAND Director since 1989
Mr. Bertrand, 61, is Chairman of Central Vermont Public Service
Corporation, Chairman of Catamount Energy Corporation, and is Past Chairman of
the Board and Chief Executive Officer of National Life Insurance Company.
He is a graduate of Norwich University and the College of William and Mary Law
School. Mr. Bertrand is a Past Chairman of the American Council of Life
Insurance, and of the Vermont Business Roundtable. Mr. Bertrand is a Director of
Union Mutual Fire Insurance Company, Vermont Electric Power Company, New England
Guaranty Insurance Company, and Central Vermont Economic Development
Corporation. Mr. Bertrand chairs the Corporation's Audit Committee.
Shares owned: 6,109
Percent: .042
DAVID M. BOARDMAN Director since 1978
Mr. Boardman, 63, is Senior Vice President of Hickok and Boardman, Inc.,
President of Associates in Financial Planning Inc., and Coldwell Banker Hickok &
Boardman, Inc., affiliates of Hickok and Boardman Financial Services, with which
he has been associated since 1956. He has also been a representative of National
Life Insurance Company since 1956. He is a Chartered Life Underwriter, a Life
and Qualifying Member of the Million Dollar Round Table and a Certified
Financial Planner. He is a Past Trustee of Vermont Catholic Charities, past
Chairman of the Burlington City Retirement Board and a member of The Burlington
Boys and Girls Club Development Steering Committee. He is past Chairman of the
Board of Champlain College, where he has been a Trustee since 1974. He is a
member of the American Society of Chartered Life Underwriters, the Institute of
Certified Financial Planners and the Association of Advanced Life Underwriters.
Shares owned: 32,536
Percent: .225
PALL D. SPERA Director since 1985
Mr. Spera, 53, is the owner of Pall Spera Company, Realtors and Pall Spera
Company, Investment Securities of Stowe. He is a Director and past President of
the Vermont Association of Realtors who named him Realtor of the Year in 1980,
and is a Director of the National Association of Realtors. Mr. Spera is a
Trustee of Vermont Catholic Charities and a Director of the Lake Mansfield Trout
Club. He is also a Trustee of Copley Hospital. Mr. Spera became an Incorporator
and a charter Director of Mountain Trust Company in 1977, was elected Vice
Chairman in 1978, served as Acting President in 1980-1981, and was Acting
Chairman of the Board prior to the merger of Mountain Trust Company with
Chittenden Trust Company.
Shares owned: 25,269
4
<PAGE>
Percent: .175
MARTEL D. WILSON, JR. Director since 1983
Mr. Wilson, 61, is the former Vice President, Chief Financial Officer and
Director of S-K-I Ltd. He graduated from the University of Colorado and received
an M.B.A. from Cornell University. Mr. Wilson is a Director and Chairman of the
Board of Building Material Distributors, Inc. of Stockton, California, a
building material wholesaler in California and Nevada. He is a past President
and Director of the Rutland Region Chamber of Commerce, a past Trustee of the
College of St. Joseph the Provider, a past President and Director of the Rutland
Regional Medical Center, and a member of the Investment Committee and past
Chairman of the Board of Trustees of Comprehensive Health Resources, a health
care holding company.
Shares owned: 20,351
Percent: .141
Continuing Directors
PAUL J. CARRARA Director since 1982
Term Expires 1999
Mr. Carrara, 61, is President of J. P. Carrara & Sons, Inc., a ready-mixed
and precast concrete supplier located in Middlebury, Vermont. He is also
President of Otter Valley Equipment, Inc., an equipment leasing firm in Rutland.
Shares owned: 4,690
Percent: .032
RICHARD D. DRISCOLL
Term Expires 2000 Director since 1997
Mr. Driscoll, 67, is the immediate past President and C.E.O. of the
Massachusetts Bankers Association since 1990. From 1957 to 1990, Mr. Driscoll
was employed by the Bank of New England, N.A., in Boston, Massachusetts in many
capacities, culminating in the position of Chairman and C.E.O. where he was
responsible for all activities of the Boston Bank and affiliate banks in eastern
New England, including affiliates in Maine and Rhode Island, representing
approximately $20 billion in assets. Mr. Driscoll is a graduate of Boston
College and holds an MBA from Harvard Business School. Mr. Driscoll serves on
the Board of Atlantic Data Services, Inc., Charlesbank Homes, Child Care
Investment Fund, Greater Boston YMCA, the Massachusetts Business Development
Corp., and Morgan Memorial, Goodwill Industries.
Shares owned: 125
Percent: .001
5
<PAGE>
LYN HUTTON
Term Expires 2000 Director since 1995
Ms. Hutton, 48, has served as Vice President and Treasurer of Dartmouth College
since 1990. From 1982 to 1990 she was associated with the University of Southern
California, first as Treasurer and then as Senior Vice President for Finance and
Administration. In 1994, the National Association for College and University
Business Officers awarded Ms. Hutton the Rodney Adams prize in recognition of
her contributions to professional development and research activities in the
field of college and university endowment and investment management. Both a
Certified Public Accountant and a Chartered Financial Analyst, Ms. Hutton serves
on the Board of Trustees of Endowment Advisors Inc., of Endowment Realty Inc.,
the University Corporation for Atmospheric Research, and Montshire Museum of
Science. She has previously served on the Board of Directors of First Interstate
Bank of California.
Shares owned: 338
Percent: .002
PHILIP A. KOLVOORD Director since 1977
Term Expires 1999
Mr. Kolvoord 65, is of counsel in the law firm of Kolvoord, Overton &
Wilson in Essex Junction, Vermont. He received his law degree from the
University of Virginia and commenced his law practice in Vermont in 1958. Mr.
Kolvoord is a member of the Discovery Museum Board of Directors and Lake
Champlain Aquarium Board of Directors. He is a former President of the Vermont
Trial Lawyers Association and the Chittenden Country Bar Association. He is a
past Chairman of the Judicial Nominating Board and the Professional Conduct
Board. Mr. Kolvoord is also Past President of The Discovery Museum for Children
in Essex Junction, Vermont. Mr. Kolvoord and other members of his firm are
retained from time to time for legal services by the Essex Junction office of
the Bank.
Shares owned: 5,787
Percent: .040
PAUL A. PERRAULT Director since 1990
Term Expires 2000
Mr. Perrault, 46, is President and Chief Executive Officer of Chittenden
Corporation and Chittenden Bank. Mr. Perrault joined the Corporation in 1990.
Prior to joining Chittenden, he was President of Bank of New England-Old Colony,
Providence, Rhode Island. Before becoming President, Mr. Perrault was Executive
Vice President and Senior Loan Officer at Bank of New England-Old Colony. Prior
to that, he served in a variety of commercial banking positions in Rhode Island
and Boston. He is a 1973 graduate of Babson College and received his M.B.A. from
Boston College School of Management in 1975. He is a Director of Lake Champlain
Regional Chamber of Commerce, Director of the Greater Burlington Industrial
Corporation, member of the Advisory Board of Fleming Museum and a Trustee of
Champlain College.
Shares owned: 54,034
Percent: .374
6
<PAGE>
JAMES C. PIZZAGALLI Director since 1980
Term expires 1999
Mr. Pizzagalli, 53, is Chairman and Chief Executive Officer of Pizzagalli
Construction Company. He joined the company in 1969 after graduating from the
University of Vermont and Boston University Law School. He is a Director of the
Associated General Contractors of America and of the AGC Education and Research
Foundation. Mr. Pizzagalli chairs the Corporation's Executive Committee.
Shares owned: 80,628
Percent: .558
Meetings of the Board of Directors and Its Audit and Executive Committees
The Board of Directors of the Corporation and the Bank held fourteen
meetings during the calendar year 1997. No Director attended fewer than
seventy-five percent of the aggregate of the meetings of the Board and the total
number of meetings held by committees of the Board on which they served during
1997.*
Audit Committee
The Corporation has a standing Audit Committee comprised of Messrs.
Bertrand (Chair), Boardman, Wilson and Ms. Hutton. The Committee held three
meetings during 1997 jointly with the internal auditor, including two meetings
with the independent public accountants of the Corporation and its subsidiaries.
The Audit Committee is charged with determining the adequacy of controls
and with monitoring the reliability of financial information by consultation
with the independent public accountants and the internal auditors.
Executive Committee
The Corporation has a standing Executive Committee comprised of Messrs.
Perrault, ex officio, Pizzagalli (Chair), Spera and Wilson. The Committee held
ten meetings during 1997.
The Executive Committee is responsible for strategic planning, officer and
non-officer compensation and Directors' succession, among other duties. In this
connection, the Executive Committee considers and recommends nominees for
election to the Board as vacancies occur. Stockholders may make suggestions for
nominees by submitting the nominee's name to the Committee in writing.
7
<PAGE>
Remuneration of Directors and Officers
The Corporation does not presently remunerate its officers, nor does it
provide retirement benefits. The Corporation compensates its Directors, other
than Mr. Perrault, in quarterly retainer fees of $500 of which 50% is paid in
the form of Corporation stock.
All of the officers of the Corporation serve and are remunerated as
officers of the Bank. Directors of the Bank, other than Mr. Perrault, are paid
an annual retainer of $3,000 without regard to attendance, $1,000 per meeting
attended for monthly meetings, and $500 per telephone conference meeting of the
Board. Fifty percent of retainers and fees is paid in the form of Corporation
stock.
Directors serving on the Bank's Audit and Executive Committees receive a
meeting fee of $500 per meeting attended and $250 per telephone conference
meetings, 50% of which is paid in the form of Corporation stock.
The Chair of the Board of the Bank receives an annual retainer of $5,000.
The Chair of the Executive Committee receives an annual retainer of $3,000 and
the Chair of the Audit Committee receives an annual retainer of $1,000. Fifty
percent of retainers is paid in the form of Corporation stock.
The payment of Directors' fees by the Corporation and the Bank may be
deferred by a Director pursuant to a Director's Deferred Compensation Plan,
adopted April, 1972, and amended January 1, 1992.
- -----------------------
*Mr. Wilson was granted an unpaid sabbatical during 1997 and his absence was not
counted.
8
<PAGE>
Report of the Committee Responsible for Compensation
The Executive Committee of the Board of Directors continues to have primary
responsibility for the administration of executive compensation. All
recommendations receive final approval of the full Board. During 1997, Executive
Committee members were: Messrs. Pizzagalli (Chair), Perrault, ex officio, and
Spera, and Mrs. Snelling.
There were no significant changes made to the Bank's compensation
philosophy or programs during 1997. Base salaries and salary ranges were once
again reviewed against local and regional survey information and all incentive
programs remained unchanged. Structured incentive programs exist on many levels
throughout the Bank including the Executive Management Incentive Compensation
Plan (EMICP), the Incentive Compensation Program (ICP) and several
department-and division-specific incentive programs. Performance targets for the
EMICP were set in January of 1997 and were based on specific earnings and return
ratios. Individual awards were made in early 1998 based upon attainment of these
goals combined with individual executive performance.
Executive compensation levels were again targeted against the peer group
used in the independent review conducted in 1995. Base salaries were measured
against the first quartile of the peer group with total executive compensation
scheduled to fall in the third quartile of the group. Based upon this review,
some minor adjustments to base salary were made at the executive level in
January 1997.
Pursuant to an agreement initiated in 1996, Mr. Perrault's annual base
salary was increased on April 1, 1997 to $300,000. Mr. Perrault's 1997 EMICP
payment of $201,842, which was based upon 1997 performance, is comprised of 50%
of his 1997 award and 25%, 15% and 10% of 1996, 1995, and 1994 awards, or
$124,500, $40,625, $21,771, and $14,946, respectively.
Additionally, in compliance with the agreement established in 1996, the
Corporation granted a supplemental cash award to Mr. Perrault based upon the
Corporation's achieving at least 10% growth in earnings per share (EPS) and a
return on equity (ROE) in excess of 15 percent. In 1997, the Corporation's
diluted EPS was $1.94, an increase in EPS of 13% over 1996. This growth in EPS,
coupled with the Corporation's ROE of 17.55%, resulted in an award of $203,649
to Mr. Perrault.
In addition to the supplemental executive retirement plan (SERP) which was
established for all members of the executive management group of the Corporation
in January 1996, Mr. Perrault continues to be eligible to be covered by a
separate agreement. Under this agreement an additional award can be granted
based upon the current year's results. In 1997, with a reported ROE of 17.55%,
the sum of $163,254 was accrued for Mr. Perrault under the SERP and his separate
agreement.
9
<PAGE>
Summary Compensation Table
The following table sets forth the cash and non-cash compensation for each of
the last three fiscal years awarded to or earned by the Chief Executive Officer
of the Corporation and the four highest paid Executive Officers of the
Corporation whose salary and bonus earned in 1997 exceeded $100,000.
<TABLE>
<CAPTION>
Annual Compensation Awards Payouts
- ----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
(a) (b) (c) (d) (e) (f) (g) (h) (i)
Long-Term
Other Restricted Securities Incentive All Other
Name and Annual Stock Underlying Plan(LTIP) Compen-
Principal Bonus Compen- Awards Options Payouts sation
Position Year Salary (2) sation (3) (#)(4) ($)(5) ($)(6)
- ----------------------------------------------------------------------------------------------------------------------------------
Paul A. Perrault 1997 $282,692 $328,149 -0- -0- -0- $77,343 $149,012
President/CEO 1996 $237,884 $127,166 -0- -0- 187,500 $74,410 $114,961
1995 $211,615 $183,760 -0- -0- -0- $54,593 $149,785
Lawrence W. DeShaw 1997 $149,961 $ 56,250 -0- -0- -0- $43,261 $ 6,969
Executive Vice 1996 $144,230 $ 47,125 -0- -0- -0- $39,228 $ 5,313
President 1995 $125,000 $ 57,500 -0- -0- 29,300 $25,175 $ 24,579
John W. Kelly 1997 $149,769 $ 56,250 -0- -0- -0- $42,956 $ 8,246
Executive Vice 1996 $143,384 $ 47,125 -0- -0- -0- $37,647 $ 5,299
President 1995 $124,230 $ 57,500 -0- -0- 29,300 $23,362 $ 24,325
Kirk W. Walters 1997 $149,769 $ 56,250 -0- -0- -0- -0- -0-
Executive Vice 1996 $2,230(1) N/A N/A -0- 15,000 -0- -0-
President 1995 N/A N/A N/A N/A N/A N/A N/A
Danny H. O'Brien 1997 $125,000 $ 46,875 -0- -0- -0- $38,021 $ 6,173
Executive Vice 1996 $124,192 $ 40,625 -0- -0- -0- $33,782 $ 5,861
President 1995 $114,230 $ 49,500 -0- -0- 29,300 $19,650 $ 21,544
</TABLE>
10
<PAGE>
Summary Compensation Table - Footnotes
1) Mr. Walters joined the Corporation on December 10, 1996, and his 1996
annual salary was $145,000.
2) Totals in this column are comprised of 50% of the EMICP that was earned in
the year shown. Additionally, based on a 1997 return on equity (ROE) of
17.55% and a diluted earnings per share (EPS) of $1.94, Mr. Perrault was
paid a bonus of $203,649 or 5% of earnings in excess of a 15% ROE. Mr.
Perrault received $45,916 under a similar formula in 1996, and $120,000
under a different arrangement in 1995.
3) At fiscal year-end 1997, Mr. DeShaw had 1,954 shares valued at $68,390.
Dividends are payable during the restriction period.
4) The options for Mr. Perrault vest in three equal installments of 62,500
shares on 6/1/97, 6/1/98 and 6/1/99. The options for Mr. Walters vested in
two equal installments of 7,500 shares on 12/10/96 and 12/10/97,
respectively. Options granted to Messrs. DeShaw, Kelly, and O'Brien vested
in four equal installments on 4/3/95, 1/1/96, 1/1/97, and 1/1/98.
5) The 1997 Long-Term Incentive Plan (LTIP) payout from the EMICP reflects 25%
of the 1996 award that was earned in 1997, 15% of the 1995 award that was
earned in 1997 and 10% of the 1994 award that was earned in 1997. The 1996
LTIP payout from the EMICP reflects 25% of the 1995 award that was earned
in 1996, 15% of the 1994 award that was earned in 1996 and 10% of the 1993
award that was earned in 1996. The 1995 LTIP payout from the EMICP reflects
25% of the 1994 award that was earned in 1995, 15% of the 1993 award that
was earned in 1995 and 10% of the 1992 award that was earned in 1995.
6) Totals in this column are comprised of: (1) a 401(k) Corporation match of
35% and an additional profit-sharing match of 30% shown as one total; (2)
the parallel match made under the Savings Plan Restoration portion of the
Supplemental Executive Retirement Plan established in January 1997 for
Mssrs. Perrault, DeShaw, and Kelly, and; (3) that piece of Mr. Perrault's
supplemental executive retirement plan (SERP) benefit which may be granted
based on the Corporation's annual results as measured by ROE. Benefits that
accrue under this arrangement are payable contingent upon Mr. Perrault's
employment with the Corporation at age 55. The figures, respectively, are
as follows: Mr. Perrault - $5,850, $5,850, and $137,312; Mr. DeShaw --
$4,676 and $2,293; Mr. Kelly -- $4,646 and $3,600; Mr. Walters - 0 and Mr.
O'Brien -- $6,173.
11
<PAGE>
Option Grants in Last Fiscal Year
There were no options granted to any of the five listed executives during 1997.
Aggregated Option Exercises in Last Fiscal Year
And Fiscal Year-End Option Values
The following table provides information on the value realized on options
exercised and outstanding options held by the Executive Officers named in the
Summary Compensation Table, and their year-end value.
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C>
(a) (b) (c) (d) (e)
Shares Number of Value of
Acquired Unexercised Unexercised
On Value Options at In-The Money Options
Name Exercise(#) Realized Fiscal Year-End (#) at Fiscal Year-End ($)
- ---- ----------- -------- ------------------- ----------------------
Exercisable Unexercisable Exercisable Unexercisable
----------- ------------- ----------- -------------
Paul A. Perrault 4,751 $92,706 73,622 125,000 $1,428,958 $1,593,500
Lawrence W. DeShaw - - 34,184 7,325 $866,860 $169,647
John W. Kelly - - 28,080 7,325 $706,987 $169,647
Kirk W. Walters - - 7,500 7,500 $115,125 $115,125
Danny H. O'Brien 8,750 $148,890 25,434 7,325 $610,345 $169,647
</TABLE>
12
<PAGE>
Long-Term Incentive Plans-Awards in Last Fiscal Year
The following table provides information on the EMICP awards for the Executive
Officers named in the Summary Compensation Table.
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C>
Estimated Future Payouts
Under Non-Stock Price Based Plan (1)
(a) (b) (c) (d) (e) (f)
Performance
Number of Or Other
Shares, Units Period Until
Or Other Maturation Threshold Target Maximum
Name Rights (#) Or Payout ($)(2) ($) ($)
- -----------------------------------------------------------------------------------------------------------------------
Paul A. Perrault N/A 3 years $ 124,500 $ 124,500 $ 124,500
Lawrence W. DeShaw N/A 3 years $ 56,250 $ 56,250 $ 56,250
John W. Kelly N/A 3 years $ 56,250 $ 56,250 $ 56,250
Kirk W. Walters N/A 3 years $ 56,250 $ 56,250 $ 56,250
Danny H. O'Brien N/A 3 years $ 46,875 $ 46,875 $ 46,875
</TABLE>
(1) Figures shown represent unearned portion of 1997 EMICP awards. Fifty
percent of 1997 awards were earned and paid based upon 1997 Corporate
profitability levels. The remaining portion will be earned on a schedule of
25%, 15% and 10% per year for each of the next three years contingent upon
the Corporation meeting profit goals established by the Board in January of
each year.
(2) Threshold payout is based on the achievement of an EPS in each of the
subsequent three years which is at least equal to that of the previous
year. If these targets are not met, minimum payment could equal $0 in any
of the remaining three years.
13
<PAGE>
Change of Control Agreements
The Corporation has entered into severance agreements with Mr. Perrault as well
as Messrs. DeShaw, Kelly, Walters, and O'Brien. These agreements are triggered
by a change of control and subsequent termination of employment under certain
circumstances. Payments are equal to a multiple of annual salary. For Mr.
Perrault, such payments would equal 2.99 times annual salary, and for Messrs.
DeShaw, Kelly, Walters, and O'Brien, 1.5, 1.99, 1.5, and 1.5 times,
respectively.
Chittenden Corporation Retirement Plans
Substantially all full-time employees of Chittenden Bank who are age 21 with one
year of service participate in the Chittenden Pension Account Plan (the "Pension
Plan"), a defined benefit pension plan intended to qualify under Section 401(a)
of the Internal Revenue Code (the "Code"). The Retirement plan is a cash balance
plan in which each participant's benefit is determined based on annual pay
credits and interest credits made to each participant's notional account.
Pay credits range from 2.5% to 11.0% of compensation up to the Wage Base and
from 5.0% to 16.0% of compensation over the Wage Base, depending on the
participant's age and length of service with the Company. Participants whose age
plus service as of December 31, 1995 equaled 70 or more are eligible for an
additional pay credit of 8.0% of compensation for plan years worked between 1996
and 2005. Compensation refers to pension eligible earnings of the participant
under the Pension Plan including the entire amount of salaries, wages, overtime
pay, commissions, bonuses, pre-tax deferrals, and similar payments reported on
Form W-2, excluding employer contributions to this or any other benefit plan,
severance amounts, and taxable income attributed to stock options. Compensation
under this plan is limited to $160,000 for 1997 (as indexed under Section
401(a)(17) of the Code.)
Interest credits are based on the notional account balance on the last day of
the prior plan year and the plan's interest credit rate. For the qualified plan,
this interest credit rate equals the average 12-month Treasury Bill rate during
December of the preceding plan year plus 0.5%, subject to a 5.0% minimum and a
8.0% maximum rate.
No pay or interest credits were granted under the plan for periods of employment
prior to January 1, 1996. Benefits accrued as of December 31, 1995 under the
prior formula were converted to an opening account balance. Service is
calculated from date of hire for purposes of determining the level of pay credit
for the plan year. The normal retirement age under the plan is age 65. Benefits
are computed on a straight life basis. Participants under this plan are entitled
to a minimum benefit equal to the amount accrued under the prior plan formula as
of December 31, 1995.
In addition, Chittenden maintains a non-qualified, supplemental plan which
provides benefits that would be paid by the Pension plan except for limitations
on pay and benefit amounts currently imposed by the Code. For the non-qualified
supplemental plan, the interest credit rate equals Chittenden's average yield on
earning assets or the equivalent earnings of an investment in Chittenden
Corporation stock, at the annual election of each participant.
14
<PAGE>
The estimated annual benefits payable from the Pension plan and Supplemental
plan to Mr. Perrault, Mr. DeShaw, Mr. Kelly, Mr. O'Brien, and Mr. Walters, upon
normal retirement age are $198,000, $129,000, $80,000, $72,000, and $55,000,
respectively. As of December 31, 1997, Mr. Perrault, Mr. DeShaw, Mr. Kelly, Mr.
O'Brien, and Mr. Walters had 7, 27, 7, 10, and 1 year(s) of credited service,
respectively, under the Pension Plan.
STOCK PERFORMANCE GRAPH
In defining an appropriate peer group, publicly traded stocks of similar sized
banking companies operating in Chittenden's general trading area were selected.
The group consists of 18 New England-based institutions.
CHITTENDEN CORPORATION
Total Return Performance
[GRAPH APPEARS HERE]
<TABLE>
Index 12/31/92 12/31/93 12/31/94 12/31/95 12/31/96 12/31/97
- --------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Chittenden Corporation 100.00 146.36 168.01 330.97 317.55 606.70
S&P 500 Index 100.00 110.02 111.51 153.26 188.36 251.12
KBW New England Bank Index 100.00 133.51 134.40 209.77 289.74 498.12
</TABLE>
BASE = 12/31/92
*ASSUMES ALL DIVIDENDS ARE REINVESTED
15
<PAGE>
Interests in Certain Transactions
The Corporation's officers, its Directors and their associates have had, and
can be expected to have in the future, financial transactions with the Bank. As
of December 31, 1997, the aggregate of loans by the Bank outstanding to the
Corporation's officers, Directors and their associates amounted to $1,773,801.
During 1997, loans by the Bank to their officers and Directors, and their
associates, and to the officers and Directors of the Corporation, and their
associates, were made in the ordinary course of business on substantially the
same terms, including interest rates and collateral, as those prevailing at the
time for comparable transactions with other persons.
Material transactions during 1997 between the Bank's and the Corporation's
officers, its Directors, and their associates occurred in the ordinary course of
business and were on terms equivalent to those prevailing at the time for
comparable transactions with other, unrelated persons.
AVAILABILITY OF INDEPENDENT PUBLIC ACCOUNTANTS
The Board of Directors of the Corporation, in accordance with the
recommendation of its Audit Committee, none of whom is an employee of the
Corporation, appointed Arthur Andersen LLP as independent public accountants of
the Corporation for the year ending December 31, 1997. The Corporation was
advised by Arthur Andersen LLP that neither the firm nor any of their associates
has any relationship with the Corporation or any affiliate of the Corporation.
Arthur Andersen LLP will have a representative at the meeting who will have an
opportunity to make a statement and will be available to respond to appropriate
questions.
During 1997, Arthur Andersen LLP examined the consolidated financial
statements of the Corporation and its subsidiaries, provided other audit
services to the Corporation and to certain of its subsidiaries in connection
with Securities and Exchange Commission filings of periodic financial
statements. In addition, Arthur Andersen LLP provided tax and consulting
services to the Corporation and certain of its subsidiaries.
16
<PAGE>
1998 DIRECTORS' OMNIBUS LONG-TERM INCENTIVE PLAN
(Item 2 on Proxy Card)
The Chittenden Corporation 1998 Directors' Omnibus Long-Term Incentive Plan
(the "Plan") has been established to promote the interests of the stockholders
as well as the Corporation by enhancing the Corporation's ability to retain and
attract the services of talented and qualified Directors by increasing their
ownership position in the Corporation. The Plan is reproduced in its entirety
and is attached to this Proxy as Exhibit A.
All non-employee Directors (approximately ten people) will be eligible to
become participants in the Plan on such basis as may be determined by the
Corporations's Executive Committee (the "Committee") who will have full power to
interpret and administer the Plan.
Subject to the terms of the Plan, the Committee shall have full power to: (i)
designate participants; (ii) determine the type or types of Awards to be granted
to each participant under the Plan; (iii) determine the number of Shares to be
covered by Awards; (iv) determine the terms and conditions of any Award; (v)
determine whether Awards may be settled or exercised in cash, Shares or other
securities; (vi) determine whether, to what extent, and under what circumstances
amounts payable with respect to an Award under the Plan shall be deferred either
automatically or at the election of the holder or the Committee; (vii) interpret
and administer the Plan and any Award made under the Plan; (viii) establish,
amend, suspend or waive rules and regulations as it shall deem appropriate for
the proper administration of the Plan; and (ix) make any other determination and
take any other action that the Committee deems necessary or desirable for the
administration of the Plan.
Overall, there shall be 100,000 shares available for granting Awards under the
Plan. Individual Awards shall not exceed 10,000 shares per participant per
year.
The Committee will be authorized to grant Options to participants with the
following terms and conditions and with such additional terms and conditions as
the Committee deems appropriate:
(I) Exercise Price. The purchase price per Share under an Option shall be
determined by the Committee; provided, however, that the purchase price
shall not be less than Fair Market Value of a Share on the date of grant
of such Option.
(II) Option Term. The term of each Option shall be fixed by the Committee,
but in no event may exceed ten years.
(III) Time and Method of Exercise. The Committee shall determine the time or
times at which an Option may be exercised in whole or in part, and the
method or methods by which payment of the exercise price may be made.
(IV) Forfeiture. The Committee may provide for the circumstances in which an
unexercised Option will be forfeited. Unless otherwise provided in the
option agreement with a Director, an unexercised Option shall be forfeited
one year after termination of Board service (as determined under criteria
established by the Committee) for any reason.
17
<PAGE>
The Committee will be authorized to grant Awards of Restricted Stock or Shares
free of any restrictions.
The Corporation's Board of Directors cannot revoke existing Awards without the
participant's consent.
The Plan shall be effective as of the date of its approval by the
Corporation's stockholders.
THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS A VOTE FOR RATIFICATION OF THE
1998 DIRECTORS' OMNIBUS LONG-TERM INCENTIVE PLAN.
DEADLINE FOR STOCKHOLDER PROPOSALS
In order to be included in the Corporation's proxy statement and proxy card
for the 1999 annual meeting, proposals which stockholders intend to present at
that meeting must be submitted in writing to the Secretary of the Corporation on
or before November 6, 1998.
OTHER BUSINESS
The Board of Directors of the Corporation knows of no other matters which may
come before the meeting. However, if any other business should properly come
before the meeting, the proxies relating to such meeting will be voted with
respect thereto in accordance with the best judgment of the Board of Directors.
18
<PAGE>
EXHIBIT A
CHITTENDEN CORPORATION
1998 DIRECTORS' OMNIBUS LONG-TERM INCENTIVE PLAN
I. PURPOSE
The Chittenden Corporation 1998 Directors' Omnibus Long-Term Incentive Plan (the
"Plan") has been established to promote the interests of the shareholders as
well as the Company by enhancing the Company's ability to retain and attract the
services of talented and qualified Directors by increasing their ownership
position in the Company.
For purposes of the Plan, unless otherwise indicated, the term "Company" shall
mean Chittenden Corporation.
II. ELIGIBILITY
All non-employee Directors will be immediately eligible to become participants
in the Plan upon the Effective Date as described in Section IX.
III. EXECUTIVE COMMITTEE
The Plan shall be administered by a Committee of the Board of Directors which
shall be known as the Executive Committee (the "Committee"). The Committee
shall have full power to interpret and administer the Plan. It may issue rules
and regulations for administration of the Plan. It shall meet at such times and
places as it may determine.
All persons designated as members of the Committee shall be non-employee
directors of the Company within the meaning of Rule 16b-3 of the Securities
Exchange Act of 1934.
IV. DEFINITIONS
As used in the Plan, the following terms shall have the meanings set forth
below:
(A) "Plan" means the Chittenden Corporation 1998 Directors' Omnibus Long-Term
Incentive Plan.
(B) "Company" means Chittenden Corporation.
(C) "Board" means the Board of Directors of the Company.
(D) "Committee" means the Executive Committee appointed by the Board.
(E) "Code" shall mean the Internal Revenue Code of 1986, as amended.
1
<PAGE>
(F) "Non-Qualified Stock Option" means a stock option grant of shares that
allows the Company to receive a tax deduction for the amount the individual
recognizes as taxable ordinary income in the year the individual is taxed;
and the individual is subject to withholding on such taxes.
(G) "Stock Option" means a Non-Qualified Stock Option.
(H) "Share" means one share of the Company's Common Stock.
(I) "Restricted Stock" means Shares granted to a Director under Section VII.(B)
of the Plan.
(J) "Share Grant" means the grant of a Share without restrictions.
(K) "Award" shall mean any Stock Option, Share Grant or Restricted Stock granted
under the Plan.
(L) "Fair Market Value" shall mean the fair market value of shares or other
securities as shall be established by the Committee.
V. ADMINISTRATION OF PLAN
The Plan shall be administered by the Committee. Subject to the terms of the
Plan, the Committee shall have full power to: (i) designate participants; (ii)
determine the type or types of Awards to be granted to each participant under
the Plan; (iii) determine the number of Shares to be covered by Awards; (iv)
determine the terms and conditions of any Award; (v) determine whether Awards
may be settled or exercised in cash, Shares or other securities; (vi) determine
whether, to what extent, and under what circumstances amounts payable with
respect to an Award under the Plan shall be deferred either automatically or at
the election of the holder or the Committee; (vii) interpret and administer the
Plan and any Award made under the Plan; (viii) establish, amend, suspend or
waive rules and regulations as it shall deem appropriate for the proper
administration of the Plan; and (ix) make any other determination and take any
other action that the Committee deems necessary or desirable for the
administration of the Plan.
VI. SHARES AVAILABLE FOR AWARD
Unless otherwise determined by the Committee, the amounts of any dividend
equivalents or interest determined by the Committee to be payable with respect
to any Awards shall not be counted against the aggregate number of shares
available for granting Awards under the Plan.
Overall, the number of Shares available for granting Awards under the Plan
during the term of the Plan shall be 100,000 shares.
Individual Awards granted under this Plan shall not exceed 10,000 shares per
participant per year.
2
<PAGE>
The number of Shares covered by the Award shall be counted on the date of grant
against the aggregate number of Shares available for granting Awards under the
Plan. Any Shares associated with a Non-Qualified Stock Option that is forfeited
or expires without having been exercised or Shares associated with Restricted
Stock that is forfeited shall be added back to the overall number of Shares
available for granting Awards under this Plan.
VII. AWARDS
(A) Options. The Committee is hereby authorized to grant Options to
--------
participants with the following terms and conditions and with such
additional terms and conditions as the Committee deems appropriate:
(I) Exercise Price. The purchase price per Share under an Option shall be
determined by the Committee; provided, however, that the purchase
price shall not be less than Fair Market Value of a Share on the date
of grant of such Option.
(II) Option Term. The term of each Option shall be fixed by the Committee,
but in no event may exceed ten years (see (D)(V) below).
(III) Time and Method of Exercise. The Committee shall determine the time
or times at which an Option may be exercised in whole or in part, and
the method or methods by which payment of the exercise price may be
made.
(IV) Forfeiture. The Committee may provide for the circumstances in which
an unexercised Option will be forfeited. Unless otherwise provided in
the option agreement with a Director, an unexercised Option shall be
forfeited one year after termination of Board service (as determined
under criteria established by the Committee) for any reason.
(B) Restricted Stock. The Committee is hereby authorized to grant Awards of
-----------------
Restricted Stock to participants.
(I) Restrictions. Shares of Restricted Stock shall be subject to such
restrictions as the Committee may impose (including, any limitation on
the right to vote a Share of Restricted Stock or the right to receive
any dividend). Restrictions may lapse separately or in combination,
in such installments or otherwise, as the Committee may deem
appropriate.
(II) Forfeiture. Upon termination of board service (as determined under
criteria established by the Committee) for any reason, except for
death or total and permanent disability, during the applicable
restriction period, all Shares of Restricted Stock subject to
restriction shall be forfeited and reacquired by the Company.
(C) Share Grants. The Committee is hereby authorized to grant awards of Shares
-------------
that are
3
<PAGE>
immediately nonforfeitable and free of any restrictions (except those deemed
necessary to comply with Federal or state securities laws or exchange
requirements as described in section (D)(VI) below).
(D) General.
--------
(I) No Cash Consideration for Awards. Awards shall be granted for no cash
consideration or for such minimal cash consideration as may be
required by applicable law.
(II) Awards May be Granted Separately or Together. Awards may, at the
discretion of the Committee, be granted either alone or in addition to
or in tandem with any other Awards under any other plan of the
Company.
(III) Forms of Payment under Awards. Subject to the terms of the Plan,
payments or transfers to be made by the Company upon the grant,
exercise or payment of an Award may be made in such form or forms as
the Committee shall determine including, without limitation, cash,
Shares, other securities and other Awards.
(IV) Limits on Transfer of Awards. No Award (other than Shares as to which
restrictions have lapsed), and no right under any such Awards, shall
be assignable, alienable, saleable or transferable by a participant
otherwise than by will or by the laws of descent and distribution (or,
in the case of an Award of Restricted Stock, to the Company);
provided, however, that, if so determined by the Committee, a
participant may, in the manner established by the Committee, designate
a beneficiary or beneficiaries to exercise the rights of the
participant, and to receive any property distributable, with respect
to any Award upon the death of the participant.
(V) Term of Awards. The term of each Award shall be for such period as may
be determined by the Committee; provided, however, that in no event
shall the term of any Stock Option exceed a period of ten years from
the date of its grant.
(VI) Share Certificates. All certificates for Shares or other securities
delivered under the Plan pursuant to any Award or the exercise of a
Stock Option shall be subject to such stop transfer orders and other
restrictions as the Committee may deem advisable under the Plan or the
rules, regulations, and other requirements of the Securities and
Exchange Commission, any stock exchange upon which such Shares or
other securities are then listed, and any applicable Federal or state
securities laws, and the Committee may cause a legend or legends to be
put on any such certificates to make appropriate reference to such
restrictions.
VIII. AMENDMENT AND TERMINATION
The Board of Directors of the Company cannot revoke existing Awards without
the participant's consent.
4
<PAGE>
IX. EFFECTIVE DATE OF THE PLAN
The Plan shall be effective as of the date of its approval by the stockholders
of the Company.
X. CHANGE IN CONTROL
For purposes of this Plan, a Change in Control shall be deemed to have
occurred upon the first to occur of the following events:
(I) Any "Person", as such term is used in Sections 13(d) and 14(d) of the
Securities Exchange Act of 1934, as amended (the "Exchange Act") (other
than the Company or any corporation owned, directly or indirectly, by the
stockholders of the Company in substantially the same proportions as their
ownership of stock of the Company), is or becomes the "beneficial owner"
(as defined in Rule 13d-3 under the Exchange Act), directly or indirectly,
of securities of the Company representing more than 25% of the number of
the Company's then outstanding securities;
(II) During any period of two consecutive years, individuals who at the
beginning of such period constitute the Board, and any new director (other
than a director designated by a person who has entered into an agreement
with the Company to effect a transaction described in Subsection (I),
(III) or (IV) of this Section X) whose election by the Board or nomination
for election by the Company's stockholders was approved by a vote of at
least two-thirds (2/3) of the directors then still in office who either
were directors at the beginning of the period or whose election or
nomination for election was previously so approved, cease by any reason to
constitute at least one half thereof;
(III) The stockholders of the Company approve a merger or consolidation of
the Company with any other corporation, other than a merger or
consolidation which would result in the voting securities of the Company
outstanding immediately prior thereto continuing to represent (either by
remaining outstanding or being converted into voting securities of the
surviving entity) more than 60% of the number of outstanding securities of
the Company or such surviving entity outstanding immediately after such
merger or consolidation; or
(IV) The stockholders of the Company approve a plan of complete liquidation of
the Company or an agreement for the sale or disposition by the Company of
all or substantially all of the Company's assets.
5
<PAGE>
XI. TERM OF THE PLAN
No Award shall be granted under the Plan five years after Effective Date of
the Plan. However, unless otherwise expressly provided in the Plan or in an
applicable Award agreement, any Award granted may extend beyond such date,
and the authority of the Committee to amend, alter, adjust, suspend,
discontinue, or terminate any such Award, or to waive any conditions or
rights under any such Award, and the authority of the Board of Directors of
the Company to amend the Plan, shall extend beyond such date.
Dated: ________________ ______________________________
F. Sheldon Prentice, Senior Vice President,
General Counsel & Secretary
6
<PAGE>
A copy of the Corporation's Annual Report for 1997 (on Form 10-K), as filed with
the Securities and Exchange Commission pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934, will be furnished free of charge to beneficial
owners of the Corporation's stock upon written request to:
F. Sheldon Prentice, Secretary
Eugenie J. Fortin, Assistant Secretary
Chittenden Corporation
P.O. Box 820
Burlington, Vermont 05402-0820
Any person requesting a copy of the report must set forth in his/her written
request a good faith representation that he/she was in fact a beneficial owner
of stock of the Corporation on the record date for the annual meeting.
IT TAKES ONE MINUTE TO FILL OUT THE PROXY CARD. PLEASE HELP ASSURE THAT THERE
WILL BE A QUORUM AT THE ANNUAL MEETING BY RETURNING YOUR PROXY.
