NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD APRIL 20, 1994
Dear Stockholder:
The Annual Meeting of Stockholders of Union Bancshares, Inc., will
be held on Wednesday, April 20, 1994, at 1:30 p.m. in the Executive
Suite, Third Floor, Union Center, 150 North Main, Wichita, Kansas
67202, for the following purposes:
1. To elect six directors as set forth in the accompanying
Proxy Statement; and
2. To transact such other business as may properly come
before the meeting or any adjournment thereof.
The management of the Corporation is aware of no other matters that
will come before the meeting. Stockholders of record at the close
of business on March 9, 1994, will be entitled to vote at this
meeting.
An Annual Report, a Proxy Statement, and a Proxy for the 1994
Annual Meeting are enclosed. You are requested to mark, date, and
sign the enclosed proxy and return it in the enclosed envelope at
your earliest convenience even if you plan to attend the meeting.
Stockholders who are present at the meeting may withdraw their
proxy prior to the exercise thereof and vote in person, if they so
desire.
We hope you will attend this meeting in person.
Very truly yours,
/S/ JACK B. HINKLE
Jack B. Hinkle
Chairman of the Board
March 18, 1994
JBH/mm
Enclosures
<PAGE>
<PAGE>
UNION BANCSHARES, INC.
PROXY STATEMENT FOR ANNUAL MEETING OF STOCKHOLDERS
APRIL 20, 1994
This Proxy Statement is furnished in connection with the
solicitation of proxies to be voted at the Annual Meeting of
Stockholders (the "Meeting") of Union Bancshares, Inc. ("UBI"), to
be held on April 20, 1994, at 1:30 p.m. in the Executive Suite,
Third Floor, Union Center, 150 North Main, Wichita, Kansas 67202,
and at any adjournments thereof. Stockholders of record at UBI's
close of business on March 9, 1994, will be entitled to vote at the
Meeting.
The Board of Directors of UBI is soliciting proxies with
respect to the election of directors and any other matters to be
submitted to the stockholders of UBI. Any such proxy, if received
in time for voting and not revoked, will be voted at the Meeting in
accordance with the instructions of the stockholder. If no
instructions are given on the proxy, the proxy will be voted in
favor of the candidates nominated by the Board of Directors.
A proxy may be revoked at any time prior to its exercise (i)
by filing, at the principal office of UBI, a written notice
revoking such proxy or a duly executed proxy bearing a later date;
or (ii) in the Meeting prior to the taking of a vote in person on
any matter presented for a vote to the stockholders of UBI at the
Meeting, whether or not such stockholder has previously given a
proxy.
Solicitation of proxies for the Meeting will be made initially
by mail through this Proxy Statement. Proxies may also be
solicited in person, by telephone, or by telegraph by the
directors, officers, and other employees of UBI, none of whom will
receive any additional compensation for their efforts. It is
expected that banks, brokerage houses, and others will be requested
to forward the soliciting material to their principals and obtain
authorization for the execution of proxies. All costs of
solicitation, including the costs of preparing, printing,
assembling, and mailing this Proxy Statement and all papers which
now accompany or may hereafter supplement the same, as well as the
reasonable out-of-pocket expenses incurred by the above-mentioned
banks, brokerage houses, and others, will be borne by UBI. UBI's
executive office is located at 200 Union Center, 150 North Main,
Wichita, Kansas 67202, telephone number (316) 261-4701. This Proxy
Statement is being first mailed or given to holders of the Class A
Common Stock of UBI on or about March 18, 1994.
A copy of the UBI Annual Report filed on Form 10K with the
Securities and Exchange Commission for the fiscal year ended
December 31, 1993, is enclosed herewith. The Annual Report is not
incorporated in this Proxy Statement and is not to be deemed a part
of the proxy soliciting material.
<PAGE>
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UNION BANCSHARES, INC.
Proxy Statement for Annual Meeting of Stockholders
April 20, 1994
Page 2
PROPOSALS FOR SUBMISSION TO STOCKHOLDERS
1. ELECTION OF DIRECTORS
Six (6) directors are to be elected at the Meeting, to hold
office until the next annual meeting of stockholders or until their
successors are duly elected. In voting for directors, each
stockholder is entitled to exercise the right of cumulative voting,
that is, to vote as many shares as shall equal the number of shares
of stock held, multiplied by the number of directors to be elected;
and to cast all of such votes for a single director or to
distribute them among two or more of the number of directors to be
elected. The six nominees receiving the highest number of votes
represented at the meeting, either in person or by proxy, shall be
elected as a director. It is intended that shares represented by
the enclosed form of proxy will be voted in favor of the election
as directors of the nominees named below, all of whom are now
directors of UBI. Each of these nominees have served as a director
of UBI for more than the past five years with the exception of Mr.
Derek L. Park. Mr. Park was elected as a director of UBI on May
19, 1993. All of these nominees are members of the Board of
Directors of UBI's subsidiary, Union National Bank of Wichita
("UNB"). If any other candidate for director is proposed at the
Meeting by persons other than the Board of Directors, the shares
represented by the proxy may be voted cumulatively for fewer than
all nominees named to serve, if elected. If any of the nominees
should become unavailable for election, the shares represented by
such proxies will be voted for such substitute nominees as may be
nominated by the Board of Directors.
The following information is given with respect to the
nominees:
<TABLE>
<CAPTION>
Served as
Principal Occupation, Director
Name Other Directorship, and Age1 Since
<S> <C> <C>
Jack B. Hinkle2,4 Sole proprietor, Hinkle Oil 1982
Company, Independent Oil Producer;
Chairman of UBI's and UNB's
Board; Director of UNB since 1948;
age 82.
Randolph D. Love3,6 Vice President of Sales & Marketing 1986
and Director of The Love Box Company,
Inc.,manufacturer of corrugated shipping
containers; Director of UNB since 1986;
age 45.
<PAGE>
<PAGE>
UNION BANCSHARES, INC.
Proxy Statement for Annual Meeting of Stockholders
April 20, 1994
Page 3
<CAPTION>
Served as
Principal Occupation, Director
Name Other Directorship, and Age1 Since
<S> <C> <C>
Robert D. Love6 President and Director of 1982
The Love Box Company,
Inc., manufacturer of corrugated
shipping containers; Director of
UNB since 1958; age 70.
Derek L. Park7 President and Director of 1993
PMS Foods, Inc., manufacturer
of industrial, food service and
retail food products; Director of
UNB since 1990; age 44.
Donald H. Pratt4 President and Director of 1982
Butler Manufacturing Company,
manufacturer of building systems
for nonresidential construction;
Director of UNB since 1974; age 56.
William G. Watson5 President and Chief Executive 1985
Officer of UBI and UNB;
Director of UNB since 1984; age 45.
<FN>
1 Each of the Directors have held the position described for more
than the past five years except as noted below.
2 Jack B. Hinkle is also a Director and President of UNB's only
subsidiary, Union Center, Inc., a Kansas Corporation.
3 Randolph D. Love was Director of Union Boulevard National Bank
from April, 1987 through December 1, 1989.
4 Jack B. Hinkle is the father-in-law of Donald H. Pratt.
5 William G. Watson was Chairman of the Board and Chief Executive
Officer of Union Boulevard National Bank from February 1987
through December 1, 1989.
6 Robert D. Love is the father of Randolph D. Love.
7 Derek L. Park was elected as a Director for UBI on May 19, 1993.
</TABLE>
<PAGE>
<PAGE>
UNION BANCSHARES, INC.
Proxy Statement for Annual Meeting of Stockholders
April 20, 1994
Page 4
PROXY STATEMENT INFORMATION
Voting Securities and Principal Holders Thereof
As of March 9, 1994, the record date, UBI had 350,690 shares of
Class A Common Stock outstanding and entitled to vote. Each share
of such stock entitles the holder thereof to one vote, except that
cumulative voting is permitted in voting for the election of
directors, as described in paragraph one of page two hereof.
UBI has approximately 343 stockholders, of whom three, directly
or indirectly, own 5% or more of UBI Class A Common Stock. They
and their interests are:
<TABLE>
<CAPTION>
Title Name and Address Amount and Nature of Percent
of Class of Beneficial Owner Beneficial Ownership of Class
<S> <C> <C> <C>
Class A Jack B. Hinkle 144,1441 41.1%
Common Union Center Building
Stock Wichita, Kansas 67202
Class A Robert D. Love 101,9902 29.1%
Common 700 East 37th Street North
Stock Wichita, Kansas 67219
Class A William G. Watson 19,0143 5.4%
Common Union Center Building
Stock Wichita, Kansas 67202
<FN>
1 Jack B. Hinkle, a director of UBI, owns of record in his
capacity as trustee of The Jack B. Hinkle Revocable Trust A,
144,144 shares of such stock. In addition, Mr. Hinkle holds
an option to purchase 7,500 shares from William G. Watson.
<PAGE>
<PAGE>
UNION BANCSHARES, INC.
Proxy Statement for Annual Meeting of Stockholders
April 20, 1994
Page 5
2 Robert D. Love, a director of UBI, owns of record as an
individual 100 shares of UBI Class A Common Stock and
beneficially through The Love Box Company, Inc., of which
corporation Mr. Love and his immediate family are sole
shareholders, 101,890 shares of such stock. As of July 16,
1982, a Voting Trust was established with respect to certain
UBI stock owned by the Love interests. The sole trustee is
Mercantile Bank of Kansas City, 1101 Walnut Street, Kansas
City, Missouri. The Love Box Company, Inc., has deposited
15,340 (included in the 101,890 shares owned by The Love Box
Company, Inc.) shares with the trustee, who has sole voting
power over these shares. Mr. Love has voting power over the
remaining 86,550 shares held by The Love Box Company, Inc.
3 William G. Watson, a director of UBI, owns of record as an
individual 18,789 shares of UBI Class A Common Stock and 25
shares in joint tenancy with his wife over which he has shared
voting power. An additional 200 shares are owned by his wife,
individually. See note 1 above as to certain agreements with
Mr. Jack B. Hinkle.
</TABLE>
Meetings of the Board of Directors and Committees
During 1993, the UBI Board of Directors held 12 meetings.
UBI's Audit Committee met three times during the year. UBI's
Compensation Committee met two times during 1993. All directors
attended at least 75% of the UBI Board and Audit Committee meetings
and at least 50% of the Compensation Committee Meetings on which
they serve as a member.
Members of the UBI Audit Committee during 1993 consisted of
Robert D. Love, Randolph D. Love, and Donald H. Pratt. Robert D.
Love served as Chairman of the Committee. Due to new requirements
of the Federal Deposit Insurance Corporation Improvement Act
(FDICIA), the election of new Audit Committee Members were
required. The new Audit Committee Members for 1994 will be Richard
A. Curry, James N. Dondlinger, and Thomas D. White. Mr. Curry will
serve as Chairman of the Committee. All of the new members serve
as a Director for UNB. The functions of the UBI Audit Committee
are to appoint independent certified public accountants to audit
UBI and all its subsidiaries, to direct internal audit and loan
review departments activities, to receive and review
recommendations from the UBI auditors, and to report findings to
the Board.
Members of the UBI Compensation Committee during 1993 were
Jack B. Hinkle, Robert D. Love, Randolph D. Love, Donald H. Pratt,
and William G. Watson. Mr. Pratt serves as Chairman of the
Committee. This Committee may, from time to time, appoint other
members to the Committee. The functions of the UBI Compensation
Committee are to review officer Performance Appraisals, officer
salaries and bonuses, compensation of Board Committees, and to
report to the Board actions and recommendations related to such
matters.
UBI has no other standing committees.
<PAGE>
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UNION BANCSHARES, INC.
Proxy Statement for Annual Meeting of Stockholders
April 20, 1994
Page 6
Executive Officers
The executive officers of UBI, other than Messrs. Hinkle and
Watson, who are listed above on pages two and three as nominees for
election to the Board of Directors, are as follows:
Steven C. Worrell (age 46) has served as Vice President,
Treasurer, and Chief Financial Officer of UBI since its formation
in 1982. For the past five years, Mr. Worrell's principal
occupations have been: July 1988, Vice President, Secretary,
Treasurer, and Chief Financial Officer of UBI, Executive Vice
President, Secretary, and Chief Financial Officer of UNB. May
1993, elected as Director of UNB.
Security Ownership of Management
The following table sets forth the Class A Common Stock of UBI
held beneficially by each of its directors and nominees, and by its
directors and officers as a group.
<TABLE>
<CAPTION>
Amount and
Title Nature of
of Name and Address of Beneficial Percent
Class Beneficial Owner Ownership of Class
<S> <C> <C> <C>
Class A Jack B. Hinkle 144,1441 41.1%
Common Union Center Building
Stock Wichita, Kansas 67202
Class A Randolph D. Love 1004 (4)
Common 700 East 37th Street North
Stock Wichita, Kansas 67219
Class A Robert D. Love 101,9902 29.1%
Common 700 East 37th Street North
Stock Wichita, Kansas 67219
Class A Derek L. Park 1004 (4)
Common P.O. Box 1099
Stock Hutchinson, Kansas 67504-1099
Class A Donald H. Pratt 6,1073 1.8%
Common P. O. Box 917
Stock Kansas City, Missouri 64141
<PAGE>
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UNION BANCSHARES, INC.
Proxy Statement for Annual Meeting of Stockholders
April 20, 1994
Page 7
<CAPTION>
Amount and
Title Nature of
of Name and Address of Beneficial Percent
Class Beneficial Owner Ownership of Class
<S> <C> <C> <C>
Class A William G. Watson 19,0145 5.4%
Common Union Center Building
Stock Wichita, Kansas 67202
Class A All directors and officers 272,928 77.8%
Common as a group (7 persons)
Stock
<FN>
1 See note 1, page 4.
2 See note 2, page 5.
3 This total includes 5,570 shares owned by Mr. Pratt's wife and 100 shares owned
by his son over which he shares voting power.
4 Less than 1%.
5 See note 1, page 4 and note 3, page 5.
</TABLE>
Compensation of Directors and Executive Officers
UBI has paid no salaries to any person, nor has it established
any pension, profit sharing, or other compensation plans except a
401K plan which was established on January 1, 1989, and is
inactive. UBI pays a monthly director's fee of $500 and a yearly
directors retainer fee of $5,000. UBI paid, in 1993, $300 per
meeting to the Chairman of its Audit and Compensation Committee and
$100 per meeting to the other outside director members of these
committees. The Compensation Committee approved an increase in
outside director committee fees effective January 1, 1994. The
committee chairperson fee will increase from $300 to $500 per
meeting and committee member fee will increase from $100 to $250.
UBI can give no other estimate concerning the compensation, if any,
to be paid by UBI to its executive officers in the future.
<PAGE>
<PAGE>
UNION BANCSHARES, INC.
Proxy Statement for Annual Meeting of Stockholders
April 20, 1994
Page 8
In the following table below are the only executive officers
and directors of UBI who received cash compensation in excess of
$100,000, which was paid by UBI and UNB for the year ended December
31, 1993:
<TABLE>
<CAPTION>
Name ANNUAL COMPENSATION
and All
Prinicipal Other Annual Other
Position Year Salary Bonus Compensation*Compensation**
<S> <C> <C> <C> <C> <C>
Jack B. Hinkle 1993 80,000 57,000 23,780 -0-
Chairman of the 1992 80,000 57,000 23,547 -0-
Board of UBI 1991 80,000 47,500 18,550 -0-
and UNB.
William G. Watson 1993 250,000 290,000 30,430 6,745
President and 1992 250,000 240,000 25,883 6,546
Chief Executive Officer 1991 250,000 175,000 21,410 6,356
of UBI and UNB.
Steven C. Worrell 1993 110,000 50,000 9,339 6,000
Vice President, Secretary, 1992 100,000 35,000 4,198 5,063
Treasurer and Chief Financial 1991 100,000 50,000 3,936 5,625
Officer of UBI;
Executive Vice President,
Secretary and Chief Financial
Officer of UNB.
<FN>
* Other annual compensation includes directors' fees, life insurance, auto expenses, etc.
** All other compensation includes employer's contributions to the 401K Plan.
</TABLE>
The compensation disclosed does not include amounts
attributable to club membership expenses provided to certain of
such officers, which amounts did not exceed 10% of their cash
compensation.
The executive officers of UBI are participants in UNB's 401K
Thrift Plan. The Thrift Plan allows an eligible participant to
contribute from 1% to 12% of annual salary to the plan. UNB
contributes 75% on the first 5% of a participants contribution.
Forfeitures by terminated participants who are not fully vested are
allocated to the remaining active participants.
<PAGE>
<PAGE>
UNION BANCSHARES, INC.
Proxy Statement for Annual Meeting of Stockholders
April 20, 1994
Page 9
Generally, a participant in the 401K Thrift Plan who retires at
age 65 or later or terminates after 7 or more years of service will
be entitled to a distribution or rollover equal to 100% of his or
her plan assets as provided by the plan document.
Amount accrued pursuant to the plan during 1992 for the
accounts of Mr. Watson was $6,745 and Mr. Worrell was $6,000 and
for all directors and executive officers as a group was $12,745.
Both individuals are fully vested.
Board Compensation Committee Report
The Compensation Committee meets annually in November of each
year to review officers' performances, year-end promotions,
salaries, bonus recommendations, and position requirements for UBI
and its major subsidiary, UNB, for the following year. This
process begins in late August with each officer completing a self-
appraisal form. This form is then used by the officer's manager in
completing the officer's review. These forms along with salary and
bonus recommendations and any promotional or other officer
recommendations are provided to the Compensation Committee for
review and action. Members of the UBI Compensation Committee
during 1993 were Jack B. Hinkle, Robert D. Love, Randolph D. Love,
Donald H. Pratt, and William G. Watson. Mr. Pratt serves as
Chairman of the Committee.
Based upon this information, the Committee approves current
year bonuses and salaries for the coming year. The Committee
discusses and approves the salary and bonus of the CEO and Chairman
of the Board, with each of these individuals being absent during
these discussions. These recommendations are reported to and
approved by the full Board of Directors of UBI and each of its
subsidiaries as required. The Compensation Committee also meets in
June of each year to follow up on and take action with regard to
any issues from the November meeting. The Compensation Committee
also reviews any special mid-year recommendations submitted to it
by management.
All officer positions, salaries, and position requirements are
analyzed and reviewed against industry standards, as well as local
and regional competition through information obtained from
compensation consultants of peer financial institutions selected on
the basis of similar size and profitability. The Committee sets
salaries for all officers including executive officers, the CEO,
and the Chairman based upon their performance over the prior year,
the salaries of comparable positions, and the duties and
responsibilities of each job. The Committee subjectively evaluates
all these criteria with no specific emphasis on any one factor when
setting compensation levels. Bonuses are paid to all officers
including executive officers, based on performance over the prior
year, accomplishment of goals established for the year, performance
of the Company, and special accomplishments beyond the normal
duties of the job. The CEO and Chairman bonuses are determined
based upon the performance of the Company.
<PAGE>
UNION BANCSHARES, INC.
Proxy Statement for Annual Meeting of Stockholders
April 20, 1994
Page 10
Performance Graph
UBI stock is not actively traded or widely held and therefore,
does not have a measurable market value. Because there is no
measurable market value, a graph is not presented as it would not
provide any meaningful conclusions.
Transactions with Management
UNB which is UBI's principal subsidiary, has had, and expects
to have in the future, banking transactions, including the making
of loans, in the ordinary course of business with officers and
directors of UBI and UNB and their associates, including associated
companies. All loans in 1993 from UNB to such persons were made in
the ordinary course of business; were made on substantially the
same terms, including interest rates and collateral, as those
prevailing at the time for comparable transactions with other
persons; and did not involve more than the normal risk of
collectability or present other unfavorable features.
In 1984, UBI made loans to William G. Watson, President and
Chief Executive Officer of UBI and UNB. The loan was made to
finance the purchase of his principal residence, secured by a
mortgage in favor of UBI, bearing an interest rate of 8.856% which
interest rate increases to 2% over UNB's prime rate upon
termination of employment at the discretion of UBI. UBI's highest
aggregate amount outstanding to Mr. Watson in 1993 was $130,446.
Mr. Watson paid off his total indebtedness to UBI on March 22,
1993.
Independent Public Accountants
Coopers and Lybrand, Certified Public Accountants, assisted by
Allen, Gibbs, & Houlik L.C., was the accounting firm which audited
and reported on the UBI consolidated financial statements for the
three years in the period ended December 31, 1992.
On October 20, 1993, the Board of Directors of UBI, voted to
dismiss Coopers & Lybrand as its independent accountants. This
decision which was approved by the Audit Committee was recommended
to the UBI Board based purely on cost efficiency and geographic
location. Also, on October 20, 1993, the Board of Directors of UBI
upon the approval and recommendation of the Audit Committee voted
to engage Allen, Gibbs & Houlik L.C. as its independent accountants
to audit UBI consolidated financial statements effective for the
fiscal year ended December 31, 1993.
During the three most recent fiscal years ended December 31,
1990, 1991 and 1992, and for the interim period from January 1,
1993 to current Coopers and Lybrand's reports did not include any
adverse opinions, qualified opinions, or disclaimers. In addition,
there were not any disagreements between Coopers & Lybrand and the
management of UBI.
<PAGE>
UNION BANCSHARES, INC.
Proxy Statement for Annual Meeting of Stockholders
April 20, 1994
Page 11
As required under Section 13 or 15(d) of the Securities and
Exchange Act of 1934, the Form 8-K was filed to record the change
in UBI's certified accounts.
Representatives of Allen, Gibbs & Houlik L.C. are expected to
be present at the stockholders' meeting to make any statement they
may desire and to respond to appropriate questions concerning the
Audit Report for the fiscal year ended December 31, 1993.
Time for Submission of Proposals of Stockholders
Any stockholder who intends to present a proposal for action at
the UBI 1995 Annual Meeting of Stockholders, currently scheduled to
be held April 19, 1995, must comply with and meet the requirements
of Regulation 14a-8 of the Securities and Exchange Commission.
That regulation requires, among other things, that a proposal be
received by UBI at its principal executive office, 200 Union
Center, 150 North Main, Wichita, Kansas 67202, by December 20,
1994. If the date of the 1995 Annual Meeting is changed to a date
more than thirty days earlier or later than April 19, 1995, UBI
shall, in a timely manner, inform stockholders of such change and
the date by which proposals of stockholders must be received for
such inclusion.
<PAGE>
Proxy
UNION BANCSHARES, INC
150 North Main, Wichita Kansas 67202
This Proxy is solicited on Behalf of the Board of Directors
The undersigned hereby appoints Mr. James N. Dondlinger and Mr. John A.
Elliot, as Proxies, each with the power to appoint his substitute, and hereby
authorize them to represent and to vote, as designated below, all of the shares
of Class A Common Stock of Union Bancshares, Inc., held of record by the
undersigned on March 9, 1994, at the annual meeting of stockholders to be held
of April 20, 1994 or any adjournments thereof.
1. Election of Directors
__For all nominees listed below __WITHHOLD AUTHORITY
(except as marked to the contrary to vote for all nominees listed
below) below
Nominees: Jack B. Hinkle, Randolph D. Love, Robert D. Love, Derek L. Park,
Donald H. Pratt, William G. Watson
(Instructions: To withhold authority to vote for any individual nominee,
write the nominee's name on the space provided.)
___________________________________________________________________________
2. Other Business: In their discretion the Proxies are authorized to vote
upon such other business as may properly come before the meeting.
TO BE SIGNED ON THE OTHER SIDE
(continued on other side)
This proxy when properly executed will be voted in the manner directed herein
by the undersigned stockholder. If no direction is made, this proxy will be
voted for Proposal 1.
Please sign exactly as name appears below. When shares are held by joint
tenants, both signatures are required. When signing as attorney, executor,
administrator, trustee, or guardian, please give full title as such. If a
corporation, please sign in full corporate name by President or other
authorized officer. If a partnership, please sign in partnership name by
authorized person.
Dated:_________________________________________________,1994
___________________________________________________________
Signature
___________________________________________________________
Signature if held jointly
PLEASE MARK, SIGN, DATE AND RETURN THE PROXY CARD PROMPTLY, USING THE ENCLOSED
ENVELOPE
