<PAGE> 1
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:
<TABLE>
<S> <C>
[ ] Preliminary Proxy Statement [ ] Confidential, for Use of the Commission
Only (as permitted by Rule 14a-6(e)(2))
[x] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to sec.240.14a-11(c) or sec.240.14a
</TABLE>
WESTBANK 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:
------------------------------------------------------------------------
<PAGE> 2
NOTICE OF
ANNUAL MEETING
OF SHAREHOLDERS
APRIL 19, 2000
AND
PROXY STATEMENT
Your Vote Is Important
You are urged to exercise your right to vote by indicating your choices on
the enclosed proxy card. Please date, sign and promptly return
your proxy card in the enclosed postage-paid envelope. You may,
nevertheless, vote in person if you attend the meeting.
<PAGE> 3
WESTBANK CORPORATION
225 PARK AVENUE
WEST SPRINGFIELD, MASSACHUSETTS 01089-3310
NOTICE OF 2000 ANNUAL MEETING OF SHAREHOLDERS
TO BE HELD WEDNESDAY, APRIL 19, 2000
MARCH 17, 2000
TO THE SHAREHOLDERS OF WESTBANK CORPORATION:
Notice is hereby given that the 2000 Annual Meeting of Shareholders of Westbank
Corporation (the "Corporation") will be held at 9:00 AM on Wednesday, April 19,
2000, at the Carriage House at Storrowton Tavern, 1305 Memorial Avenue, West
Springfield, Massachusetts 01089, for the following purposes, all as set forth
in the Proxy Statement accompanying this notice:
1. Election of the individuals listed as nominees in the Proxy Statement
accompanying this notice of meeting.
2. Ratification of the appointment of the firm of Deloitte & Touche LLP as
the Corporation's independent public accountants for the fiscal year
ending December 31, 2000.
3. To act upon such other maters as may properly be brought before the
meeting or any adjournment thereof.
The record date and hour for determining shareholders entitled to notice of, and
to vote at, the meeting has been fixed at 5:00 PM, March 6, 2000.
By order of the Board of Directors
Robert J. Perlak
Clerk
West Springfield, Massachusetts
March 17, 2000
PLEASE SIGN THE ENCLOSED FORM OF PROXY AND RETURN IT PROMPTLY IN THE ENVELOPE
ENCLOSED FOR THAT PURPOSE. YOU MAY, NEVERTHELESS, VOTE IN PERSON IF YOU DO
ATTEND THE MEETING.
1
<PAGE> 4
PROXY STATEMENT
Approximate date of mailing
March 17, 2000
WESTBANK CORPORATION
225 PARK AVENUE
WEST SPRINGFIELD, MASSACHUSETTS 01089-3310
(413) 747-1400
NOTICE OF 2000 ANNUAL MEETING OF SHAREHOLDERS
TO BE HELD APRIL 19, 2000
INTRODUCTION
This Proxy Statement is furnished to shareholders in connection with the
solicitation of proxies on behalf of the Board of Directors of Westbank
Corporation (the "Corporation") to be used at the 2000 Annual Meeting of
Shareholders of the Corporation to be held at the Carriage House at Storrowton
Tavern, 1305 Memorial Avenue, West Springfield, Massachusetts 01089 on
Wednesday, April 19, 2000 at 9:00 AM and at any adjournments thereof.
The close of business on March 6, 2000 has been fixed as the record date for
determination of shareholders of the Corporation entitled to notice of and to
vote at the 2000 Annual Meeting of Shareholders. The only class of issued and
outstanding voting securities of the Corporation is the $2.00 par value Common
Stock (the "Common Stock"). As of the record date, the number of shares of
Common Stock outstanding and entitled to vote at the 2000 Annual Meeting of
Shareholders is 4,273,119. Each share of Common Stock is entitled to one vote.
The affirmative vote of a majority of the shares of Common Stock of the
Corporation represented at the 2000 Annual Meeting is required to appoint the
auditor of the Corporation. The affirmative vote of a plurality of the votes
cast by shareholders is required to elect Directors.
Execution of the enclosed proxy will not affect the shareholder's right to
attend the meeting and vote in person. A shareholder that has given proxy has
the power to revoke it at any time before it is exercised by delivering notice
of revocation, or a duly executed proxy bearing a later date, to the Treasurer
of the Corporation.
2
<PAGE> 5
ELECTION OF DIRECTORS
The By-Laws of the Corporation provide, in substance, that the Board of
Directors shall be divided into three classes as nearly equal in number as
possible and that the term of office of one class shall expire and a successor
class shall be elected at each Annual Meeting of the Shareholders. The
Corporation's Board of Directors presently consists of ten members. Following
the election of Directors at the 2000 Annual Meeting of Shareholders, the
Corporation's Board of Directors shall consist of nine members.
Seven Directors will continue to serve after the 2000 Annual Meeting of
Shareholders. In accordance with the By-Laws of the Corporation, two nominees
shall be elected to serve a three-year term until the 2003 Annual Meeting of
Shareholders and for such further time as may be required for the election and
qualification of their successors. Unless returned proxies properly indicate
that authority to vote for any of the nominees named herein is withheld, all
proxies received by the Corporation in time for the 2000 Annual Meeting of
Shareholders will be voted in favor of the election of the nominees listed
below. In the event any of the nominees named herein becomes unable or unwilling
to accept nomination for election, the persons identified as proxies in the
accompanying form of proxy will vote the shares represented by executed proxies
in favor of the nomination and election of such substitute nominees as the Board
of Directors of the Corporation may select.
The following tables name the individuals nominated for Director and those
Directors of the Corporation who will continue to serve after the Meeting, and
indicate their age, the period of time they have served as Director of the
Corporation or its predecessor, their position with the Corporation, and their
principal occupation or employment. No nominee or Director holds a directorship
in any corporation, other than the Corporation, with a class of securities
registered pursuant to Section 12 of the Securities and Exchange Act of 1934 or
subject to the requirements of Section 15(d) of such Act or any corporation
registered as an investment company under the Investment Company Act of 1940.
3
<PAGE> 6
The following individuals are nominees for election as a Director of the
Corporation at the 2000 Annual Meeting to serve for a three-year term until the
2003 Annual Meeting of Shareholders:
<TABLE>
<CAPTION>
Nominee and Current Occupation Has Served on Board of
Or Employment; Business Directors of the Corporation Corporate
Experience During the Past 5 years Age or Its Predecessor Since Offices Held
---------------------------------- --- ------------------------ ------------
<S> <C> <C> <C>
Ernest N. Laflamme Director,
Treasurer Chairman
City of Chicopee 68 1987 Of the Board
G. Wayne McCary
President and Chief Executive Officer
Eastern States Exposition 57 1999 Director
</TABLE>
The following Directors will continue to serve after the meeting:
<TABLE>
<CAPTION>
Director and Current Occupation Has Served on Board of
Or Employment; Business Directors of the Corporation Corporate
Experience During the Past 5 years Age or Its Predecessor Since Offices Held Term Expires In
---------------------------------- --- ------------------------ ------------ ---------------
<S> <C> <C> <C> <C>
Roland O. Archambault
President and Owner
Pinnacle Raceway 67 1989 Director 2001
Mark A. Beauregard
Attorney
Resnic, Beauregard, Waite and Driscoll 48 1986 Director 2002
David R. Chamberland
President
Chicopee Building Supply, Inc. 61 1989 Director 2002
Donald R. Chase
President and Chief Executive Officer
Westbank Corporation; Director, President
President and Chief Executive Officer and Chief
Park West Bank and Trust Company 53 1990 Executive Officer 2001
Robert J. Perlak
Corporate Clerk
Westbank Corporation
Private Investor 64 1987 Director and Clerk 2002
George R. Sullivan
Chief Executive Officer
Sullivan Paper Company, Inc. 46 1997 Director 2001
James E. Tremble
President
Valley Communications Systems, Inc. 61 1986 Director 2002
</TABLE>
4
<PAGE> 7
The total number of special and regular meetings of the Board of Directors of
the Corporation during the fiscal year ended December 31, 1999 was 16. Each
Director attended at least 75% of all Board of Directors meetings held in 1999
during the period for which each was a Director. In addition to serving as
Directors of the Corporation, board members also serve as the Board of Directors
of the Corporation's wholly owned subsidiary, Park West Bank and Trust Company
("Park West"). During 1999, the Board of Directors of Park West met 18 times.
All Directors attended at least 75% of all board meetings of Park West during
the period for which each was a Director.
COMMITTEES
The Board of Directors each year appoints Directors to serve on standing
committees of the Board of Directors, including the Executive Committee, the
Compensation Committee, the Nominating Committee and the Audit Committee. The
members of the Executive Committee, the Compensation Committee, the Nominating
Committee and the Audit Committee of the Corporation also make up these same
committees for Park West. All Directors attended at least 75% of the meetings of
committees of which they were a member during the period each was a Director.
EXECUTIVE COMMITTEE
The members of the Executive Committee in 1999 were Messrs. Laflamme,
Beauregard, Chase, Jarrett and Tremble. The Executive Committee met 24 times
during 1999.
COMPENSATION COMMITTEE
The members of the Compensation Committee in 1999 were Messrs. Laflamme,
Beauregard, Jarrett and Tremble. The Compensation Committee met twice in 1999.
NOMINATING COMMITTEE
The members of the nominating Committee in 1999 were Messrs. Chamberland, Chase,
Laflamme and Sullivan. The Committee nominates Directors for election by
shareholders at the Annual Meeting, reports to the Board of Directors on or
before December 31 of each year its nominations and submits its nominees for
Directors for publication in the Notice of Annual Meeting of Shareholders and
Proxy Statement. The Committee met one time during 1999. The Nominating
Committee will consider nominees recommended by the Corporation's shareholders
prior to December 1 of each year.
5
<PAGE> 8
AUDIT COMMITTEE
The members of the Audit Committee in 1999 were Messrs. Archambault,
Chamberland, Jarrett, McCary and Sullivan. The Committee makes recommendations
concerning the selection of an independent auditor for the Corporation, and
reviews the reports of the independent auditor and that of the Internal Auditor.
The Audit Committee met 4 times during 1999.
EXECUTIVE OFFICERS
In addition to the President of the Corporation, who is a Director and is listed
in the tables above, the other executive officers of the Corporation are as
follows: Gary L. Briggs, Age 49, is Executive Vice President of the Corporation
and Park West; John M. Lilly, Age 51, is Treasurer and Chief Financial Officer
of the Corporation and is also Executive Vice President and Treasurer of Park
West. Each executive officer serves for a one-year term or until their successor
is elected and qualified.
BENEFICIAL OWNERSHIP OF STOCK
The following table sets forth certain information as of the record date with
respect to all individuals known to the Corporation to be the beneficial owner
of more than 5% of the outstanding Common Stock of the Corporation:
<TABLE>
<CAPTION>
Number of Shares
Name and Address of Owner Beneficially Owned(1) Percent of Outstanding Shares
------------------------- --------------------- -----------------------------
<S> <C> <C>
Richard S. Sullivan
Carol B. Sullivan
96 Prynwood Road
Longmeadow, MA 01106 317,091 7.42%
Donald R. Chase
Diana L. Chase
39 Timber Ridge Road
West Springfield, MA 01089 273,179(2) 6.39%
</TABLE>
- --------
(1) Under regulations of the Securities and Exchange Commission, a person
is treated as the beneficial owner of a security if the person directly
or indirectly (through contract, arrangement, understanding,
relationship or otherwise) has or shares (a) voting power, including
the power to vote or to direct the voting, of such security, or (b)
investment power with respect to such security, including the power to
dispose or direct the disposition of such security. A person is also
deemed to have beneficial ownership of any security that such person
has the right to acquire within 60 days.
(2) Included in the shares beneficially owned by Mr. Chase are 136,000
unexercised stock options.
6
<PAGE> 9
The following table and related notes set forth information as of the record
date regarding the Corporation's Common Stock beneficially owned by each
Director and nominee and by Directors, nominees and officers of the Corporation:
<TABLE>
<CAPTION>
Name of Individual Number of Shares
or Persons in Group Beneficially Owned(1)(2)(3) Percent of Outstanding Shares
------------------- --------------------------- -----------------------------
<S> <C> <C>
Roland O. Archambault 26,823 .6%
Mark A. Beauregard 21,022 .5
David R. Chamberland 25,180 .6
Donald R. Chase 273,179 (5) 6.4
Leroy F. Jarrett 70,304 1.6
Ernest N. Laflamme, Jr. 47,180 (4) 1.1
G.. Wayne McCary 4,500 (4) .1
Robert J. Perlak 48,756 1.1
George R. Sullivan 22,300 .5
James E. Tremble 16,661 .4
All Directors, nominees and
Executive Officers as a group
(12 persons, including those 756,600 17.7
named above)(3) (5)
</TABLE>
Section 16(a) Beneficial Ownership Reporting Act of 1934, as amended (the
"Exchange Act"), requires the Corporation's Directors, Executive Officers and
holders of more than 10% of the Corporation's Common Stock to file with the
Securities and Exchange Commission initial reports of ownership and reports of
changes in ownership of Common Stock and other equity securities of the
Corporation. The Corporation believes that, during the fiscal year ended
December 31, 1999, all such persons complied with all Section 16(a) filing
requirements. In making this statement, the Corporation has relied upon the
written representations of its Directors and Executive Officers.
- --------
(1) Based upon information provided to the Corporation by the indicated
persons.
(2) Under regulations of the Securities and Exchange Commission, a person
is treated as the beneficial owner of a security if the person directly
or indirectly (through contract, arrangement, understanding,
relationship or otherwise) has or shares (a) voting power, including
the power to vote or to direct the voting of such security, or (b)
investment power with respect to such security, including the power to
dispose or direct the disposition of such security. A person is also
deemed to have beneficial ownership of any security that such person
has the right to acquire within 60 days.
(3) The information in the table includes all shares under stock options
which were exercisable on the record date or 60 days thereafter. As of
that date, Mr. Chase owned exercisable options to purchase 136,000
shares, and all Directors and Officers as a group owned exercisable
options to purchase 341,500 shares.
(4) Indicates a nominee for election as a Director of the Corporation at
the 2000 Annual Meeting of Shareholders.
(5) For the purposes of the above table, the term "Executive Officer" means
any individual elected as an Executive Officer of the Corporation
7
<PAGE> 10
EXECUTIVE MANAGEMENT COMPENSATION
Compensation decisions for executive officers of the Corporation are made by the
Compensation Committee and approved by the full Board of Directors. Mr. Chase,
who is a member of the Board of Directors, as well as an executive officer of
the Corporation, is not a member of the Compensation Committee and neither
participated in nor voted upon his compensation package as a member of the Board
of Directors.
REPORT OF THE COMPENSATION COMMITTEE ON EXECUTIVE MANAGEMENT COMPENSATION
Set forth below is the report of the Compensation Committee of the Corporation
regarding executive management compensation, as required by applicable rules of
the Securities and Exchange Commission.
The executive compensation program of the Corporation consists of three primary
components: base salary, cash incentive compensation and stock options, all of
which are administered by the Compensation Committee.
Decisions by the Compensation Committee relating to the compensation of the
Corporation's executive officers are approved by the full Board of Directors,
except as otherwise set forth herein. In determining the proper amount of
compensation for each executive officer, the Compensation Committee considers
various factors, including, inter alia:
- - the performance of the Corporation;
- - the individual's performance as an executive officer of the
Corporation;
- - the amount of compensation paid to similarly situated executive
officers in similar sized corporations; and
- - the length of service with the Corporation.
During 1995, the Corporation engaged the firm of Deloitte & Touche LLP to review
the Bank's retirement plan for executive officers. As a result of this review,
the Compensation Committee adopted the Westbank Supplemental Executive
Retirement Plan (the "Supplemental Plan"). The purpose of the Supplemental Plan
is to provide executives with retirement benefits that are comparable to those
provided to its other employees.
In early 1997, the Compensation Committee engaged Thomas Warren & Associates,
Inc. to assist in establishing salary levels and an incentive compensation plan
for the Corporation's senior executives ("The Incentive Compensation Plan"). The
Incentive Compensation Plan was adopted by the Compensation Committee and is
used as a guide in determining executive officer compensation.
During 1999, the Chief Executive Officer, Donald R. Chase, received a salary
increase of $34,500, an increase of fifteen percent (15%) of his base salary.
The increase was recommended by the Compensation Committee following its
evaluation of Mr. Chase's performance as Chief Executive Officer and the overall
performance of the Corporation for 1998. In addition, as a result of The
Incentive Compensation Plan, Mr. Chase received a cash bonus of $50,600. In
addition, the Corporation contributed $20,323 to the Supplemental Plan for the
benefit of Mr. Chase.
8
<PAGE> 11
The other executive officers named in the Summary Compensation Table, Messrs.
Briggs and Lilly, were granted a salary increase of fifteen percent (15%) during
1999, based on the Corporation's and their individual performance.
The Compensation Committee believes that the 1999 compensation of executive
officers is reasonable, given the Corporation's performance and utilizing the
criteria listed above.
Respectfully submitted by:
Ernest N. Laflamme, Jr. Mark A. Beauregard
Chairman Leroy F. Jarrett
James E. Tremble
The Compensation Committee
COMPENSATION INFORMATION
The following table sets forth the cash compensation paid, as well as long-term
compensation paid, for each of the last three fiscal years to all executive
officers of the Corporation who received over $100,000.00 in cash compensation
during 1999.
SUMMARY COMPENSATION TABLE
<TABLE>
<CAPTION>
Annual Compensation Long-Term Compensation
------------------- ----------------------
Award Payouts
----- -------
Other
Annual Restricted All Other
Name and Compen- Stock Options/ LTIP Compen-
Principal Position Year Salary Bonus sation ($) Award(s)($) SAR's(#) Payouts sation ($)
- ------------------ ---- ------ ----- ---------- ----------- -------- ------- ----------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Donald R. Chase 1999 $264,500 $50,600 N/A N/A 36,000 N/A $36,505 *
President and 1998 $230,000 $58,000 N/A N/A 50,000 N/A $29,870 *
Chief Executive Officer 1997 $185,000 $58,000 N/A N/A N/A N/A $25,091 *
Gary L. Briggs 1999 $138,000 $21,600 N/A N/A 12,000 N/A $16,182 **
Executive Vice President- 1998 $120,000 $24,200 N/A N/A 15,000 N/A $14,103 **
Lending 1997 $110,000 $37,500 N/A N/A N/A N/A $14,824 **
John M. Lilly 1999 $138,000 $21,600 N/A N/A 12,000 N/A $16,182 **
Treasurer and 1998 $120,000 $24,200 N/A N/A 15,000 N/A $14,103 **
Chief Financial Officer 1997 $110,000 $37,500 N/A N/A N/A N/A $14,824 **
</TABLE>
* Mr. Chase's other compensation during 1999, 1998 and 1997,
respectively, consisted of a $16,182, $16,592 and $15,476 contribution
to the Money Purchase Pension Plan and a $20,321, $13,278 and $9,615
contribution to the Corporation's Supplemental Executive Retirement
Plan.
** Messrs. Briggs and Lilly's other compensation during 1999, 1998 and
1997 consisted solely of contributions to the Money Purchase Pension
Plan.
9
<PAGE> 12
1985 INCENTIVE STOCK OPTION PLAN FOR KEY EMPLOYEES
In February, 1985, the Board of Directors of the Corporation unanimously adopted
the 1985 Incentive Stock Option Plan for Key Employees (the "1985 Stock Plan"),
which was approved by the shareholders at the Annual Meeting in April, 1985. The
1985 Stock Plan was amended by shareholders at the Corporation's 1994 Annual
Meeting, which amendment increased the number of shares of Common Stock reserved
thereunder by 200,000 shares.
The 1985 Stock Plan is administered by the Board of Directors. The Board of
Directors was authorized to grant stock options to the professional and
supervisory employees of the Corporation and its subsidiaries at any time until
February 19, 1995.
All options were granted at 100% of the fair market value of the Common Stock of
the Corporation on the date of the grant. Each stock option terminates not more
than 10 years after the date of the grant. Options are exercisable in such
installments as may be determined by the Board of Directors. Payment of stock
purchased on the exercise of a stock option must be made in full at the time the
stock option is exercised. Options may not be assigned or transferred, other
than be will or the laws of descent or distribution.
As of February 19, 1995, the 1985 Stock Plan expired. No options were granted or
available for granting during 1999.
A total of 3,301 options were exercised in 1999. A total of 1,155 options were
terminated during 1999 and a total of 39,828 options remain unexercised as of
the record date.
1996 STOCK INCENTIVE PLAN
On February 21, 1996, the Board of Directors unanimously adopted the Westbank
Corporation 1996 Stock Incentive Plan (the "1996 Plan"), which was approved by
the shareholders at the Annual Meeting in April, 1996.
The 1996 Plan is administered by the Compensation Committee (the "Committee").
The Committee is authorized to grant Employee Awards under the 1996 Plan to any
employee. In practice, Employee Awards are made to a group of management
employees.
All options are granted at 100% of the fair market value of the Common Stock of
the Corporation on the date of the grant. Each stock option terminates not more
than 10 years after the date of the grant. Options are exercisable in such
installments as may be determined by the Committee. Payment of stock purchased
on the exercise of a stock option must be made in full at the time the stock
option is exercised. Options may not be assigned or transferred, other than by
will or the laws of descent or distribution.
The Board of Directors may, at any time, terminate and, from time to time, may
amend or modify the 1996 Plan, without approval of Westbank shareholders, except
to the extent that such shareholder approval is required by applicable law or
regulation. There is no set termination date for the 1996 Plan.
A total of 83,500 incentive stock options were granted during 1999, while no
options were exercised. A total of 312,000 options remain unexercised as of the
record date.
10
<PAGE> 13
OPTIONS/STOCK APPRECIATION RIGHTS (SAR) GRANTS IN LAST FISCAL YEAR
The chart below discloses information regarding options granted pursuant to the
1996 Stock Initiative Plan as the same apply to the named executives.
<TABLE>
<CAPTION>
OPTIONS/STOCK APPRECIATION RIGHTS (SAR) GRANTS IN LAST FISCAL YEAR
Individual Grants
-----------------
Potential
Realizable Value
Percent of Total at Assumed
Options/SAR's Annual Rates of
Granted to Exercise or Stock Price
Options/SAR's Employees Base Price Expiration Appreciation for
Name Granted (#) in Fiscal Year ($/Share) Date Option Term
- ---- ----------- -------------- --------- ---- -----------
5% 10%
----- ----
<S> <C> <C> <C> <C> <C> <C>
Donald R. Chase 36,000 43% $ 10.125 4/07/09 $229,140 $580,860
Gary L. Briggs 12,000 14 10.125 4/07/09 76,380 193,620
John M. Lilly 12,000 14 10.125 4/07/09 76,380 193,620
</TABLE>
LONG-TERM INCENTIVE PLANS AND RETIREMENT PLANS
The Corporation does not maintain any "Long-Term Incentive Plans" for its
executive officers.
The corporation has no pension, profit sharing or similar plans for its
executive officers or employees. As set forth below, however, the executive
officers and employees are eligible to participate in the Park West Money
Purchase Pension Plan.
Park West maintains a Money Purchase Pension Plan (the "Plan") available to
employees of the Corporation, Park West and Cargill Bank ("Cargill"). Full-time
employees become eligible to participate in the Plan when they have both (i)
reached the age of 20-1/2 and (ii) completed six months of service (as defined
in the Plan).
Contributions to the Plan may be made by Park West, Cargill and a participant.
Park West and Cargill's contributions will be made to the Plan whether or not a
participant chooses to contribute. The annual contribution by Park West to each
participant's account for 1999 equals 7% of a participant's annual compensation,
plus 5.7% of a participant's annual compensation in excess of the participant's
Social Security Taxable Wage Base. During 1999, Park West Contributed $16,182
for the account of Donald R.
Chase and $16,182 each for the accounts of Messrs. Briggs and Lilly.
During 1999, Park West contributed in the aggregate $48,546 for the accounts of
all executive officers to the Money Purchase Pension Plan.
11
<PAGE> 14
DIRECTOR COMPENSATION
During 1999, Directors of the Corporation who are not salaried employees
received Directors' fees of $12,000. The Chairman of the Board of Directors
received annual remuneration of $17,500, while the Clerk of the Corporation
received an annual fee of $14,500. Directors who are also salaried employees
receive no additional compensation for their services as Directors of the
Corporation.
1995 DIRECTORS STOCK OPTION PLAN
In February, 1995, the Board of Directors of the Corporation unanimously adopted
the 1995 Directors Stock Option Plan (the "1995 Plan"), which was approved by
the shareholders at the Annual Meeting in April, 1995.
The 1995 Plan is administered by the non-employee Directors. The purpose of the
1995 Plan is to enhance the Corporation's ability to attract and retain highly
qualified individuals to serve as members of the Corporation's Board of
Directors and to provide additional incentives to non-employee Directors to
promote the success of the Corporation.
Under the 1995 Plan, eligible Directors were granted options to purchase 1,000
shares at an exercise price of $12.00 per share during 1999. On each anniversary
of the effective date of the 1995 Plan, each eligible Director shall be granted
an option to purchase 1,000 shares of the Corporation's Common Stock. A total of
10,000 options were granted during 1999 at an option price of $12.00 per share
and a total of 9,000 options were granted during 2000 at an exercise price of
$8.75. A total of 39,000 shares remain available for future grants under the
1995 Plan.
Each stock option terminates not more than 10 years after the date of the grant.
Payment of stock purchased on the exercise of an option must be made in full at
the time the stock option is exercised. Options may not be assigned or
transferred, other than by will or the laws of descent or distribution. A total
of 5,000 options were exercised during 1999.
12
<PAGE> 15
1996 STOCK INCENTIVE PLAN
On February 21, 1996, the Board of Directors adopted the Westbank Corporation
1996 Stock Incentive Plan (the "1996 Plan"), which was approved by the
shareholders at the Annual Meeting in April 1996.
The 1996 Plan authorizes the automatic grant of nonqualified stock options
("Director Stock Options") to non-employee Directors ("Eligible Directors") upon
the terms and conditions set forth in the 1996 Plan. The 1996 Plan is intended
to provide incentives and rewards for employees and Eligible Directors (i) to
support Westbank's business and human resource strategies and the achievement of
its goals, and (ii) to associate the interests of employees and Eligible
Directors with those of Westbank's shareholders.
Under the 1996 Plan, Eligible Directors were granted options to purchase 1,000
shares at an exercise price of $10.50 per share during 1999. At the 2000 Annual
Meeting and each year thereafter until the Meeting in 2001, each Eligible
Director who was an Eligible Director immediately preceding such Annual Meeting
and who has been elected as a Director at such Annual Meeting shall
automatically be granted Director Stock Options for 1,000 shares of Westbank
Common Stock if, but only if, the return on common equity of Westbank as set
forth in Westbank's Annual Report to Shareholders for the immediately preceding
fiscal year is equal to or greater than 12%.
Based on the Corporation's 1999 financial results, each Eligible Director is
entitled to a grant of 1,000 shares of Westbank Common Stock for 2000 at an
exercise price that is equal to the fair market value of the stock on the date
of the grant.
No Director Stock Option may be exercisable later than twenty years and one day
from the date of its grant. However, if an Eligible Director ceases to be an
Eligible Director for any reason, all Director Stock Options which are otherwise
exercisable shall terminate on the earlier of three years after such cessation
date or the expiration date, whichever first occurs. No Director Stock Options
were exercised during 1999.
CARGILL BANK DIRECTORS AND OFFICERS STOCK OPTION PLAN
During 1992, Cargill Bancorp, Inc. adopted a Stock Option Plan for its Directors
and officers. All options expire fifteen (15) years after the date of the grant.
A total of 21,954 options were exercised during 1999 and 43,908 options remain
unexercised.
No options are available for future grants.
EMPLOYMENT AND TERMINATION AGREEMENTS
Donald R. Chase has entered into a Termination Agreement with Park West
regarding termination of employment subsequent to a "change in control" of Park
West as defined in the Termination Agreement. Following the occurrence of a
change in control, if Mr. Chase's employment is terminated (except because of
retirement, death, disability or for "cause" as defined in the Termination
Agreement) or is voluntarily terminated by Mr. Chase for "good reason" as
defined in the Termination Agreement, then Mr. Chase shall be entitled to a lump
sum payment approximately equal to three times his average annual compensation
for the previous five years.
13
<PAGE> 16
PERFORMANCE COMPARISON GRAPH
Set forth below is a graph illustrating the return that would have been realized
(assuming reinvestment of dividends) by an investor who invested $100 on
December 31, 1994, in each of the following:
a. The Standard & Poor's 500 Index
b. A hypothetical fund with investments in the stock of peer corporations
(the "Peer Group")
c. Westbank Corporation
The Peer Group consists of New England financial institutions with assets
totaling between $300 and $600 million. The members of the Peer Group are:
<TABLE>
<S> <C> <C>
Alliance Bancorp of New England Home Port Bancorp, Inc. Northeast Bancorp
Bancorp Connecticut, Inc. Lawrence Savings Bank Slade's Ferry Bancorp
Boston Private Financial Holdings New Hampshire Thrift Bancshares, Inc. Wainwright Bank & Trust Company
Central Bancorp, Inc. NewMil Bancorp, Inc. Warren Bancorp, Inc.
</TABLE>
<TABLE>
<CAPTION>
Year Westbank Peer S&P 500
---- -------- ---- -------
<S> <C> <C> <C>
1994 100 100 100
1995 119.3 128.4 134.1
1996 167.1 158.7 161.3
1997 235.9 296.2 211.3
1998 243.3 222.5 267.6
1999 167.6 194.8 319.9
</TABLE>
MISCELLANEOUS
During 1999, certain of the Corporation's executive officers, Directors and
nominees for Director, beneficial owners of more than 5% of the outstanding
common stock of the Corporation and members of their immediate family and
associates have had, and expect to have in the future, transactions in the
ordinary course of business with Park West and/or Cargill, including borrowings,
on substantially the same terms, including interest rates and collateral, as
those prevailing at the time for comparable transactions with other persons, and
not involving more than normal risk of collectibility or presenting other
unfavorable features.
14
<PAGE> 17
EMPLOYEE STOCK OWNERSHIP PLAN
On January 1, 1989, the Corporation's Employee Stock Ownership Plan (the "ESOP")
became effective. The ESOP is administered and otherwise governed by the
provisions of the ESOP and a related Trust Agreement. Pursuant to the terms of
the ESOP, the Trustee may invest the ESOP's Trust Assets in, among other
investments, shares of the Common Stock of the Corporation. As of the record
date, no shares of the Common Stock of the Corporation were owned by the ESOP
Trust.
DIVIDEND REINVESTMENT PLAN
In 1989, the Corporation implemented a Dividend Reinvestment and Common Stock
Purchase Plan (the "Dividend Reinvestment Plan"), which was amended during 1995
and the amendment was approved by the shareholders at the 1995 Annual Meeting.
Pursuant to the amended Dividend Reinvestment Plan, shareholders of the
Corporation's Common Stock may invest all or a portion of that shareholder's
quarterly cash dividend, plus up to $10,000 per calendar quarter, in additional
shares of the Corporation's Common Stock. During 1999, 54,626 shares of the
Corporation's Common Stock were purchased through the Dividend Reinvestment and
Common Stock Purchase Plan.
RATIFICATION OF THE SELECTION OF
CERTIFIED PUBLIC ACCOUNTANTS
Deloitte & Touche LLP ("Deloitte"), certified public accountants, have served as
auditors for the Corporation since 1994 and, subject to ratification by the
shareholders, that firm has been chosen by the Board of Directors to act as the
Corporation's auditor for 2000. During 1999, Deloitte provided audit services in
connection with the examination of the financial statements of the Corporation,
Park West and Cargill, and other accounting matters. Neither Deloitte nor any of
its partners has any direct or indirect financial interest in, or connection
with (other than as independent auditor), the Corporation, Park West or Cargill.
A representative of Deloitte & Touche LLP is expected to be present at the
Corporation's 2000 Annual Meeting of Shareholders. He/she will have the
opportunity to make a statement if he/she desires to do so and will be available
to respond to appropriate questions.
The Board of Directors recommends a vote FOR ratification of the selection of
Deloitte & Touche LLP as the Corporation's auditor and, unless otherwise
directed, proxies will be voted in favor of this selection.
15
<PAGE> 18
OTHER BUSINESS
As of the date of this Proxy Statement, the Board of Directors of the
Corporation is not aware of any business to be presented at the 2000 Annual
Meeting other than matters referred to in the Notice of Annual Meeting and this
Proxy Statement. If any other matters properly come before the meeting, or any
adjournment thereof, the enclosed Proxy will be voted on such matters in
accordance with the recommendations of the Corporation's Board of Directors.
MISCELLANEOUS
The expense of this solicitation on behalf of the Board of Directors will be
paid by the Corporation. To the extent necessary in order to assure sufficient
representation of shareholders at the Meeting, officers and employees of the
Corporation may personally, by telephone or by other means, contact shareholders
to request the return of proxies. Banks, brokerage houses and other
institutions, nominees or fiduciaries will be requested to forward the proxy
material to beneficial owners in order to solicit authorizations for the
execution of proxies. The Corporation may, upon request, reimburse such banks,
brokerage houses and other institutions, nominees and fiduciaries for their
expenses in forwarding such material.
STOCKHOLDER PROPOSALS
Any stockholder proposals (including Director nominations) submitted pursuant to
Exchange Act Rule 14a-8 and intended to be presented at the Corporation's 2001
Annual Meeting of Stockholders must be received by the Corporation by November
17, 2000 to be eligible for inclusion in the Proxy Statement and Form of Proxy
to be distributed by the Board of Directors in connection with such meeting.
Such proposals must also comply with the requirements as to form and substance
established by the SEC if such proposals are to be included in the Proxy
Statement and Form of Proxy.
The Corporation's By-Laws provide that any stockholder proposals (including
Director nominations) intended to be presented at the Corporation's 2001 Annual
Meeting, other than a stockholder proposal submitted pursuant to Exchange Act
Rule 14a-8, must be received in writing at the principal executive office of the
Corporation on or between the dates of December 20, 2000 and February 3, 2001,
together with all supporting documentation required by the Corporation's Amended
By-Laws. However, if the 2001 Annual Meeting is scheduled to be held on a date
more than 30 days before April 19, 2001, or more than 60 days after April 19,
2001, a stockholder's notice shall be timely filed if delivered to, or received
by, the Corporation at its principal executive office not later than the close
of business on the later of (a) 75 days prior to the date of such rescheduled
Meeting or (b) the 15th day following the day on which public announcement of
the date of such Annual Meeting is first made by the Corporation.
16
<PAGE> 19
ANNUAL REPORT
A copy of the Corporation's Annual Report for 1999, including financial
statements, is enclosed. The Annual Report is not to be regarded as proxy
soliciting material.
By order of the Board of Directors
Robert J. Perlak
Clerk
Dated: March 17, 2000
NOTICE
A COPY OF THE CORPORATION'S ANNUAL REPORT ON FORM 10-K, FILED WITH THE
SECURITIES AND EXCHANGE COMMISSION, MAY BE OBTAINED WITHOUT CHARGE BY ANY
SHAREHOLDER OF THE CORPORATION UPON WRITTEN REQUEST ADDRESSED TO JOHN M. LILLY,
TREASURER, 225 PARK AVENUE, WEST SPRINGFIELD, MASSACHUSETTS 01089-3310.
17
<PAGE> 20
WESTBANK CORPORATION
PROXY FOR 2000 ANNUAL SHAREHOLDERS MEETING - APRIL 19, 2000
I, the undersigned holder of common stock of Westbank Corporation, hereby
appoint Lloyd S. Hall and Joseph L. Rolak, or either of them, with the power of
substitution, proxies of the undersigned to vote the shares of the undersigned
at the 2000 Annual Meeting of Shareholders of Westbank Corporation to be held at
9:00 A.M., April 19, 2000, at the Carriage House at Storrowton Tavern, 1305
Memorial Avenue, West Springfield, Massachusetts, and at any adjournment
thereof, with all the powers the undersigned would possess if personally
present. Said proxies are specifically authorized to vote as indicated below.
THIS PROXY CONFERS AUTHORITY TO VOTE "FOR" EACH PROPOSITION LISTED BELOW
UNLESS AUTHORITY IS WITHHELD OR OTHERWISE INDICATED. ALL PROXIES EXECUTED
CORRECTLY WILL BE VOTED AS DIRECTED. IF ANY OTHER BUSINESS IS PRESENTED AT THE
MEETING, THIS PROXY SHALL BE VOTED IN ACCORDANCE WITH THE RECOMMENDATIONS OF THE
BOARD OF DIRECTORS.
1. ELECTION OF DIRECTORS. To elect the following Directors of the
Corporation for a three-year term until the 2003 Annual Meeting of
Shareholders.
Ernest N. Laflamme, Jr. / / FOR / / AGAINST / / ABSTAIN
G. Wayne McCary / / FOR / / AGAINST / / ABSTAIN
2. SELECTION OF CERTIFIED PUBLIC ACCOUNTANTS. To ratify the appointment,
by the Board of Directors, of Deloitte & Touche LLP as independent
public accountants for the fiscal year ending December 31, 2000.
/ / FOR / / AGAINST / / ABSTAIN
(over)
<PAGE> 21
3. OTHER BUSINESS. In their discretion, to act upon the transaction of
such other business as may properly come before the meeting and any
adjournment thereof.
Date:
----------------------------------
----------------------------------------
(Signature of Shareholder)
----------------------------------------
(Signature, if jointly held)
When signing as Attorney, Executor,
Administrator, Trustee or Guardian,
please give full title. IF MORE THAN ONE
TRUSTEE, ALL SHOULD SIGN. ALL JOINT
OWNERS MUST SIGN.
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS.
