UNION BANKSHARES COMPANY
66 Main Street
Ellsworth, Maine 04605
March 28, 1997
Dear Stockholder:
The 1997 Annual Meeting of the Stockholders of Union Bankshares Company will
be held at 2:00 p.m. on Thursday, April 17, 1997 at the Holiday Inn, High
Street, Ellsworth, Maine. The directors and officers join me in inviting
you to attend the meeting.
Enclosed are the Clerk's official Notice of Annual Meeting, a proxy
statement and a form of proxy. Please sign the proxy and return it in the
enclosed self-addressed envelope so that your shares will be voted at the
meeting if you are unable to attend.
We look forward to seeing you on April 17.
Very truly yours,
Peter A. Blyberg
President
PAB/cc
Enclosures
It is important that proxies be returned promptly. Each
stockholder is urged to fill in, date and sign the enclosed proxy and mail
it in the self-addressed envelope provided. In the event a stockholder
decides to attend the meeting, he or she may, if he or she wishes revoke his
or her proxy and vote his or her shares in person.
1 <PAGE>
UNION BANKSHARES COMPANY
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD APRIL 17, 1997
Notice is hereby given that the Annual Meeting of the Stockholders
of Union Bankshares Company (the "Company") will be held at the Holiday Inn,
High Street, Ellsworth, Maine on April 17, 1997 at 2:00 p.m. to consider and
act upon the following proposals:
1. To set the number of directors at 17.
2. To elect as directors the nominees listed in the enclosed
Proxy Statement.
3. To elect Sally J. Hutchins as Clerk of the Company.
4. To ratify the Board of Directors' selection of Berry, Dunn,
McNeil & Parker as independent auditors of the Company for
1997.
5. To transact such other business as may properly come before
the meeting or any adjournment thereof.
Stockholders of record as of the close of business on February 26,
1997 will be entitled to notice of and to vote at the meeting.
By Order of the Board of Directors
Sally J. Hutchins, Clerk
2 <PAGE>
UNION BANKSHARES COMPANY
66 MAIN STREET
ELLSWORTH, MAINE 04605
PROXY STATEMENT
MAILING DATE: MARCH 28, 1997
ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD THURSDAY, APRIL 17, 1997
This Proxy Statement is furnished to the Stockholders of Union
Bankshares Company (the "Company") in connection with the solicitation of
proxies on behalf of the Company for use at the Annual Meeting of
Stockholders (the "Meeting") to be held on Thursday, April 17, 1997 at 2:00
p.m. at the Holiday Inn, High Street, Ellsworth, Maine pursuant to the
accompanying Notice of Annual Meeting of Stockholders. A form of proxy for
use at the Meeting and a return envelope for the proxy are enclosed. The
proxy, when properly executed, will be voted on behalf of the stockholder in
the manner directed in the form of proxy. A stockholder who executes the
proxy may, prior to its use, revoke it by written instrument, by a
subsequently executed proxy or, if he or she attends the Meeting, by
notifying the Clerk or by giving notice at the Meeting.
Proxies are being solicited by the Board of Directors of the
Company principally through the mail. Proxies may also be solicited
personally or by telephone. The entire expense of solicitation, including
cost of preparing, assembling and mailing the proxy materials, will be borne
by the Company.
VOTING SECURITIES AND PRINCIPAL HOLDERS THEREOF
As of February 3, 1997, the Company had outstanding 201,903 shares
of its common stock (the "Common Stock"), par value $25 per share, each
share of which is entitled to one vote upon each of the matters presented at
the Meeting. Only stockholders of record at the close of business on
February 26, 1997 are entitled to vote at the Meeting. The presence at the
Meeting, in person or by proxy, of the holders of a majority of the shares
of Common Stock entitled to vote will constitute a quorum. Assuming a
quorum is present, action may be taken by the holders of a majority of the
shares present and voting on any matter brought before the Meeting. Under
applicable Maine law, abstentions and shares otherwise not voting will not
be deemed present and voting for this purpose. Voters recorded by proxy
will be counted immediately prior to the Meeting and the results will be
announced at the Meeting. Stockholders who are present will have an
opportunity to vote on each matter brought before the meeting.
The following table lists, as of February 3, 1997, the number of
shares of Common Stock and the corresponding percentage of total Common
Stock beneficially owned by the only stockholder who is the beneficial owner
of more than five percent of the Common Stock of the Company.
Name and Address of Common Stock Percent
Beneficial Owner Beneficially Owned of Class
Alfred S. Martin
Suite 110, Huntingdon Plaza
399D Huntingdon Pike
Huntingdon, PA 19006 14,402 7.13
3 <PAGE>
The following table lists, as of February 3, 1997, the number of
shares of Common Stock, including directors' qualifying shares, and the
corresponding percentage of total Common Stock beneficially owned by each
director and nominee for director, including the chief executive officer of
the Company, and by all executive officers and directors as a group. The
information set forth below is based upon director questionnaires
distributed and completed by each director and nominee, and upon stock
records maintained by the Company.
Name Common Stock Percent
Beneficially Owned of Class
Arthur J. Billings 70 *
Peter A. Blyberg 104 *
Robert S. Boit 8,888 4.40
Richard C. Carver 626 *
Peter A. Clapp 34 *
Sandra H. Collier 70 *
Robert B. Fernald 184 *
Douglas A. Gott 270 *
David E. Honey 232 *
Delmont N. Merrill 120 *
Thomas R. Perkins 1,069 *
Casper G. Sargent, Jr. 1,560 *
John V. Sawyer, II 1,075 *
Stephen C. Shea 658 *
Richard W. Teele 185 *
Paul L. Tracy 154 *
Richard W. Whitney 62 *
Total Ownership of all
listed directors and
other officers 15,870 *
*Represents ownership of less than 1%.
For purposes of the above table, beneficial ownership has been
determined in accordance with the provisions of Rule 13d-3 promulgated under
the Securities Exchange Act of 1934, as amended, under which, in general, a
person is deemed to be the beneficial owner of a security if he or she has
or shares the power to vote or to direct the voting of the security or has
the power to dispose of, or to direct the disposition of, the security, or
if he or she has the right to acquire beneficial ownership of the security
within 60 days.
Based upon copies of Forms 3, 4 and 5 submitted to and retained by
the Company, the Company knows of no director, officer or beneficial owner
of more than ten percent (10%) of the total outstanding shares of Common
Stock who either failed to file an appropriate ownership report with the
Securities and Exchange Commission, or who filed such report other than on a
timely basis.
5 <PAGE>
ELECTION OF DIRECTORS
Management recommends that the number of directors for the coming
year be set at 17. The Bylaws of the Company provide for not fewer than 10
nor more than 25 directors, with the directors serving "staggered terms" of
three years. The Board of Directors has nominated for re-election to three
year terms at the 1997 Annual Meeting Messrs. Billings, Carver, Fernald,
Perkins and Shea. Each of the nominees has consented to be named as a
nominee and to serve if elected. In the event any nominee shall be unable
to serve, discretionary authority is reserved by management to vote for a
substitute to be nominated by the Board.
There are no arrangements or understandings between any nominee,
director, executive officer or associate of any of the foregoing and any
other person pursuant to which the nominee was or is to be elected as a
director or an executive officer. There is no family relationship among any
director, officer or person nominated to become a director or executive
officer.
The following table sets forth the names, occupations, ages and
terms of service of all directors and nominees. Each director is also
presently a director of the Company's banking subsidiary, Union Trust
Company (the "Bank").
6 <PAGE>
Year First
Elected as
Principle Occupation Age as of Director of
Now and for Past 5 Years 4/18/97 the Company
Term expires in 1997:
Arthur J. Billings President, Barter
Lumber Company 41 1990
Richard C. Carver Owner and Manager,
Carver Oil Co. 64 1984
and Carver Shellfish, Inc.
Robert B. Fernald Treasurer, A.C. Fernald Sons,
Inc. and Jordan-Fernald 63 1986
Thomas R. Perkins Retired Pharmacist 66 1984
Retired Legislative Liason MSHA
Stephen C. Shea Secretary, E.L. Shea, Inc.;
President Shea Leasing 50 1988
Term expires in 1998:
Douglas A. Gott Owner, Douglas A. Gott
& Sons, General
Contractors 63 1986
David E. Honey Retired; former Manager,
Swans Island 68 1984
Electric Cooperative
Casper G. Sargent, Jr. Owner, Sargent's Real
Estate Corporation 67 1984
John V. Sawyer, II President, Worcester-Sawyer
Agency; Chairman of the Board of
the Company and the Bank 63 1984
Paul L. Tracy President and owner of
Winter Harbor Agency; 35 1995
Vice President and co-owner
of Schoodic Insurance
Services
Richard W. Whitney Dentist 68 1984
Term expires in 1999:
Peter A. Blyberg President and CEO of the
Company and the Bank
since April 1, 1996; 53 1993
former Executive Vice
President of the Company
and the Bank; former Vice
President for Commercial
Banking at Chemical Bank
7<PAGE>
Robert S. Boit Retired President and
CEO of the Company 66 1984
and the Bank
Peter A. Clapp President, Blue Hill
Garage 52 1995
Sandra H. Collier Attorney, Ferm,
Collier & Larson 45 1992
Delmont N. Merrill President, Merrill
Blueberry Farms 71 1992
President, Husson College
Richard W. Teele Retired; Secretary and
former Executive Vice
President and Treasurer
of the Company 65 1984
and the Bank
8 <PAGE>
COMMITTEES
The Bylaws of the Company provide that, at the annual meeting of
the Directors, the Board shall designate from among its members an Executive
Committee. The Executive Committee shall have all of the powers of the
Board of Directors with regard to ordinary operations of the business of the
Company when the Board is not in session, subject to any specific vote of
the Board. The Executive Committee currently is comprised of Messrs.
Blyberg, Boit, Fernald, Merrill, Perkins, Sargent, Sawyer, and Shea.
The Bylaws of the Company provide that the Board of Directors may
elect or appoint such other committees as it may deem necessary or
convenient to the operations of the Company. The Company does not have a
standing audit, nominating or compensation committee. No other committees
have been appointed.
Nominees for election to the Board of Directors are selected by the
full Board. The Board of Directors will consider nominees recommended by
stockholders if submitted in writing to Sally J. Hutchins, Clerk, Union
Bankshares Company, 66 Main Street, Ellsworth, Maine 04605 not less than
three months in advance of the date of the annual meeting.
The Board of Directors of the Company met twelve times in 1996.
Each director attended at least seventy-five percent of the total number of
meetings of the Board of Directors and of committees, of which he or she was
a member, held during that year.
EXECUTIVE OFFICERS
Each executive officer of the Company is identified in the
following table which also sets forth the respective office, age and period
served in that office of each person listed. Executive officers are elected
annually by the Board of Directors.
Year First
Elected to
Name Principal Occupation Age Office
Peter A. Blyberg President and CEO 53 1993
of the Company
COMPENSATION OF DIRECTORS AND EXECUTIVE OFFICERS
The following table sets forth all annual compensation received
during each of the Company's last three fiscal years by each executive
officer for whom such compensation exceeded $100,000 in any reported year.
Each executive officer serves in comparable positions with both the Bank and
the Company. Executive compensation is paid by the Bank.
9<PAGE>
SUMMARY COMPENSATION TABLE
Long Term Compensation
Annual Compensation Awards Payouts
(a) (b) (c) (d) (e) (f) (g) (h) (i)
Other
Name Annual Restricted All Other
and Compen- Stock LTIP Compen-
Principal Salary Bonus sation Award(s)OptionsPayouts sation
Position Year ($) (4) ($) (s) SARs# ($) ($)
Peter A. Blyberg 1994 $117,000 $2,311 $0 $0 0 $0 $ 3,380
President and 1995 $125,000 $5,265 $0 $0 0 $0 $ 6,543
Chief Executive 1996 $133,335 $5,000 $0 $0 0 $0 $10,382
Officer
Each director of the Bank who is not also an officer is paid a
director's fee in the amount of $200 for each meeting attended, including
meetings of the Board committees of which the director is a member.
Director's fees are paid by the Bank and are not separately paid for
attendance at meetings of the Board of Directors of the Company. John V.
Sawyer, II, who serves as Chairman of the Board receives a salary of $26,000
per annum from the Bank but does not receive director's fees for attendance
at Board and Committee meetings. No director has received any other
compensation for Board or committee participation or other special
assignments.
The Bank maintains a non-contributory defined benefit pension plan
funded by a trust (the "Plan"). All full time employees who are at least 21
years of age and have completed one year of service participate in the Plan.
Compensation attributable to the Plan has not been included in the Summary
Compensation Table set forth above. Annual contributions to the Plan are
computed on an actuarial basis to provide a normal retirement benefit of 60%
of average annual salary minus 50% of the participant's social security
benefit, with a downward adjustment if the participant, at the time of
retirement, has completed less than 25 years of service. "Average Annual
Salary" is determined by calculating the average basic compensation of the
participant exclusive of bonuses for the three highest consecutive years
prior to attaining the age of 65; provided, however, that for the purpose of
such calculation base compensation in any year may not exceed $150,000. The
Plan provides "Normal Retirement Benefits" to participants who terminate
their employment after attaining the age of 65 or after completing five
years of accredited service with the Bank. The accrued benefit of a
10<PAGE>
participant who retires prior to age 65 is his or her normal benefit
adjusted by a fraction which represents his or her Bank employment time
divided by the Bank employment time he or she would have had by age 65.
Payment options include single life annuities and joint annuities. The Plan
does not provide a disability or a death benefit except a spousal benefit if
the employee was at least 55 years of age, had 10 years of service and had
agreed to accept a reduced pension. Mr. Blyberg is a participant in the
Plan. For purposes of the Plan, Mr. Blyberg has three credited years of
service.
11 <PAGE>
The table below illustrates retirement compensation for
representative salary brackets and years of service with the Bank.
PENSION PLAN TABLE
Reenumeration Years of Service
15 20 25 30 35
$120,000 $38,707 $51,610 $64,512 $64,512 $64,512
$130,000 $42,307 $56,410 $70,512 $70,512 $70,512
$140,000 $45,907 $61,210 $76,512 $76,512 $76,512
$150,000 $49,507 $66,010 $82,512 $82,512 $82,512
The foregoing table illustrates the value of retirement benefits at
the compensation levels indicated. Benefits are expressed in today's
dollars.
In addition to the foregoing defined benefit pension plan, the Bank
has entered into deferred compensation agreements with certain of its
executive employees, including Mr. Blyberg, pursuant to which, subject to
continued employment with the Bank and certain other conditions, such
executive employees are entitled to receive certain retirement and
disability benefits. Pursuant to his agreement with the Bank, Mr. Blyberg
is entitled to receive monthly payments in the amount $4,152.17, for a
period of ten years following the first to occur of death or retirement
after reaching the age of 65 years. Under the terms of the agreement, Mr.
Blyberg may elect to retire early after reaching the age of 60 years, in
which event he would be entitled to receive a proportionately reduced
monthly benefit. In addition to the foregoing benefits, under the terms of
the agreement, in the event that Mr. Blyberg is permanently disabled prior
to attaining the age of 65 years, he would be entitled to receive a
disability benefit in the amount of $2,000 per month from the date of his
disability until he reached the age of 65. Upon reaching age 65, he would
be entitled to receive the deferred compensation benefit described above.
The obligations of the Bank under these deferred compensation agreements is
unfunded, but the Bank has purchased insurance contracts on the lives of all
covered employees, including Mr. Blyberg, in amounts which are estimated to
be sufficient to fund all amounts payable under the agreements.
The Bank also has entered into salary continuation agreements with
certain of its executive officers, including Mr. Blyberg, pursuant to which,
should he terminate his employment, either voluntarily or involuntarily,
within three years of a change of control or other "business combination" as
defined in the Company's bylaws, he would be entitled to receive an amount
equal to the lesser of (i) three times the total compensation paid to him in
the last full fiscal year prior to termination of his employment, less one
dollar, or (ii) the maximum amount permitted without such payment being
deemed an "excessive parachute payment" within the meaning of Section 208-g
of the Internal Revenue Code.
Neither the Bank nor the Company has a formal compensation
committee. Mr. Blyberg, in his capacity as President and Chief Executive
Officer, has made compensation recommendations to the Executive Committee of
the Board of Directors with respect to all employees, other than himself.
The recommendations were then considered by the Board of Directors which
also formulated a compensation recommendation with respect to Messr.
12<PAGE>
Blyberg. All compensation recommendations were then considered and voted
upon by the full Board of Directors. Mr. Blyberg is a member of the Board
of Directors and a member of the Executive Committee. He has abstained from
participating in discussions or recommendations regarding his own
compensation.
13 <PAGE>
REPORT OF THE BOARD OF DIRECTORS ON EXECUTIVE COMPENSATION
The Board of Directors of the Bank has no formal compensation
policy applicable to compensation decisions with respect to its executive
officers. While there are no objective criteria which specifically relate
corporate performance to compensation determinations, in formulating its
recommendation with respect to compensation of Mr. Blyberg during the last
fiscal year, the Board of Directors considered, among other factors, the
seniority and experience of Mr. Blyberg and the relationship of his
compensation to that of other executive officers employed by the Bank and to
persons holding comparable positions at other similarly situated banks in
Maine. In reaching its determination as to the compensation of Mr. Blyberg,
the Board of Directors did not use any objective measure of the Bank's
performance but considered, in general, the performance of the Bank in
relationship to that of other similarly situated banks in Maine.
The forgoing report regarding compensation has been submitted by
the Board of Directors, including Douglas A. Gott, David E. Honey, Casper G.
Sargent, Jr., John V. Sawyer, II, Richard W. Whitney, Peter A. Blyberg,
Robert S. Boit, Peter A. Clapp, Sandra H. Collier, Delmont N. Merrill,
Richard W. Teele, Arthur J. Billings, Richard C. Carver, Robert B. Fernald,
Thomas R. Perkins, Stephen C. Shea and Paul L. Tracy.
PERFORMANCE GRAPH
Federal regulations require that a graph be included in this proxy
statement providing a comparison of total shareholder return on the Common
Stock of the Company with that of other comparable issuers. The following
graph illustrates the estimated yearly percentage change in the Company's
cumulative total shareholder return on its Common Stock for each of the last
five years. For purposes of comparison, the graph also illustrates
comparable shareholder return of NASDAQ banks as a group as measured by the
NASDAQ Banks Stock Index and of Bar Harbor Bankshares, which is, in the
opinion of management, the only other bank holding company with respect to
which a meaningful comparison of total shareholder return can be made. The
graph assumes a $100 investment on December 31, 1991 in the common stock of
each of the Company, Bar Harbor Bankshares and the NASDAQ banks as a group
and measures the amount by which the market value of each, assuming
reinvestment of dividends, has increased as of December 31 of each calendar
year since the base measurement point of December 31, 1991.
Insert 5 Year Line Chart
14<PAGE>
Neither the common stock of the Company nor that of Bar Harbor
Bankshares is actively traded on any market and therefore, no market index
is available for the purpose of determining the market price of such common
stock as of any particular date. The foregoing graph is based upon a good
faith determination of approximate market value for each year indicated
based on information obtained from Bar Harbor Bankshares, in the case of its
common stock, and from anecdotal information available to the Company as to
the value at which its common stock has traded in isolated transactions from
time to time. Therefore, although the graph represents a good faith
estimate of shareholder return as reflected by market value, the valuations
utilized are, of necessity, estimates and may not accurately reflect the
actual value at which common stock has traded in particular transactions as
of any of the dates indicated.
SELECTION OF AUDITORS
The Board recommends that the stockholders ratify its selection of
Berry, Dunn, McNeil & Parker as independent auditors of the Company for
1997.
Berry, Dunn, McNeil & Parker has assisted the Company with
preparation of periodic filings with the Securities and Exchange Commission
and has also assisted the Bank with preparation of filings with the Federal
Reserve Board. In addition, Berry, Dunn, McNeil & Parker performed services
for the Bank in connection with the preparation of income tax filings. All
services rendered by Berry, Dunn, McNeil & Parker were approved by the Board
of Directors, which considered the possible effect of such services on the
independence of Berry, Dunn, McNeil & Parker. Management anticipates that
Berry, Dunn, McNeil & Parker will render comparable services to the Bank and
the Company in 1997.
Stockholder approval of the selection of auditors is not required,
but the Board is of the view that an expression of opinion by the
stockholders as to the appropriateness of this selection is desirable. The
Board recommends that its selection of Berry, Dunn, McNeil & Parker be
ratified. If its selection is not ratified, the Board will take action to
appoint a different auditor. It is expected that a representative of Berry,
Dunn, McNeil & Parker will be present at the Meeting, will have an
opportunity to make a statement if he or she so desires and will be
available to respond to appropriate questions.
OTHER MATTERS
Management knows of no other matters to be presented for action at
the Meeting. If any of the nominees for the office of Director become
unavailable for election or if any other matters properly come before the
Meeting, the shares represented by proxies will be voted with respect
thereto in accordance with the judgement of the person voting the proxies.
STOCKHOLDERS PROPOSALS FOR NEXT ANNUAL MEETING
Stockholders may submit proposals for consideration at the 1998
annual meeting, which is presently scheduled for April 16, 1998. In order
to be included in the Company's proxy statement and form of proxy relating
to that meeting, such proposals must be received by the Company no later
15<PAGE>
than December 17, 1997. Proposals should be addressed to Peter A. Blyberg,
President, Union Bankshares Company, 66 Main Street, Ellsworth, Maine 04605.
Ellsworth, Maine By Order of the Board of Directors
March 28, 1997 Sally J. Hutchins, Clerk
UNION BANKSHARES COMPANY P The undersigned hereby appoints Sally J.
66 Main Street R Hutchins and Peter A. Blyberg as Proxies,
Ellsworth, Maine 04605 O each with power to appoint a substitute and
This proxy is solicited X hereby authorizes them to represent and vote
on behalf of the Board Y as designated below, all the shares of of
Directors. commom stock of the Company held of record by
the undersigned as of the close of business
on February 26, 1997, at the annual meeting
of stockholders to be held on April 17, 1997,
or at any adjournment thereof.
1. To set the number of Directors at 17:
For Against Abstain
2. To elect as Directors of the Company:
Arthur J. Billings, Richard C. Carver, Robert B. Fernald, Thomas R.
Perkins and Stephen C. Shea
VOTE FOR ALL LISTED NOMINEES AUTHORITY TO VOTE FOR DIRECTORS IS
WITHHELD
VOTE FOR LISTED NOMINEES EXCEPT THE FOLLOWING: (Instruction: To withhold
authority to vote for any individual nominee, write the name of the
nominee(s) in the space provided below.)
3. To elect Sally J. Hutchins as Clerk of the Company
For Against Abstain
4. To ratify the Board of Directors' selection of Berry, Dunn, McNeil &
Parker as independent auditors of the Company for 1997.
For Against Abstain
5. To transact such other business as may properly come before the meeting
or any adjournment thereof.
16 <PAGE>
THIS PROXY WHEN PROPERLY EXECUTED WILL BE VOTED ON BEHALF OF THE UNDERSIGNED
STOCKHOLDER IN THE MANNER DIRECTED HEREIN. IF NO DIRECTION IS MADE, THIS
PROXY WILL BE VOTED IN FAVOR OF THE NOMINEES LISTED IN PROPOSALS 2 AND 3,
AND IN FAVOR OF PROPOSALS 1 AND 4, AND IN THE DISCRETION OF MANAGEMENT WITH
RESPECT TO ANY OTHER MATTERS WHICH MAY COME BEFORE THE MEETING.
Please sign exactly as name appears below. Only one joint tenant need sign.
When signing as attorney, executor, administrator, trustee or guardian, or
in any representative capacity, please give full title.
Dated
Signature
Signature
17<PAGE>
