<PAGE>
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the
Securities Exchange Act of 1934
(Amendment No. )
Filed by the Registrant [ ]
Filed by a Party other than the Registrant [X]
Check the appropriate box:
[X] Preliminary Proxy Statement
[ ] Confidential for use of the Commission Only (as permitted by Rule
14a-6(e)(2))
[ ] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to ss. 240.14a-11(c) or ss. 240.14a-12
People's Bancshares, Inc.
(Name of Registrant as Specified In Its Charter)
RCG Kingston Fund, Ltd.
RCG Kingston, L.L.C.
Kingston Fund, LP
Ramius Capital Group, LLC
C4S & Co., LLC
Jennings & Gillen
D.B. Jennings, Inc.
Donald B. Jennings
Thomas F. Gillen
The Partnership for Bank Capital, L.P.
Vincent A. Smyth
Mary E. Smyth
(Name of Person(s) Filing Proxy Statement)
<PAGE>
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:
------------------------------------------------------------
[ ] 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-
<PAGE>
2) Form, Schedule or Registration Statement No.:
------------------------------------------------
3) Filing Party:
------------------------------------------------
4) Date Filed:
------------------------------------------------
-3-
<PAGE>
PRELIMINARY COPY - APRIL 28, 2000
PEOPLE'S BANCSHARES, INC.
------------------------------------------
2000 ANNUAL MEETING OF STOCKHOLDERS
-------------------------------------------
PROXY STATEMENT OF THE KINGSTON GROUP IN OPPOSITION TO THE BOARD OF
DIRECTORS OF PEOPLE'S BANCSHARES, INC.
This Proxy Statement is being furnished to holders of common stock, par
value $0.10 per share ("Common Stock"), of People's Bancshares, Inc., a
Massachusetts corporation (the "Company"), in connection with the solicitation
of proxies for use at the 2000 Annual Meeting of Stockholders of the Company and
at any and all adjournments or postponements thereof (the "Annual Meeting"). The
solicitation is being conducted by the Kingston Group. Information concerning
the persons comprising the Kingston Group is set forth below under "The Kingston
Group." Members of the Kingston Group collectively own approximately 9.2% of the
outstanding Common Stock. As more fully discussed below, the Kingston Group is
soliciting proxies in connection with the Annual Meeting for the election of
William G. Foster, Jr., John R. Kennedy and Vincent A. Smyth as directors of the
Company (collectively, the "Kingston Group Nominees" and each, a "Kingston Group
Nominee"), to serve until their successors are duly elected and qualified.
The Company has announced that the Annual Meeting will be held at Stone
Forge Public House, 90 Paramount Drive, Raynham, Massachusetts, on Friday, June
16, 2000, at 10:00 a.m., local time Only stockholders of record at the close of
business on April 28, 2000 (the "Record Date") will be entitled to notice of and
to vote at the Annual Meeting.
The enclosed BLUE proxy card may be executed by holders of record as of the
Record Date. You are urged to sign and date the enclosed BLUE proxy card and
return it in the enclosed envelope whether or not you attend the meeting.
YOUR VOTE IS IMPORTANT. If you agree with the reasons for the Kingston
Group's solicitation set forth in this Proxy Statement and believe that the
election of the Kingston Group Nominees to the Board of Directors can make a
difference, we urge you to vote for the election of the Kingston Group's
nominees, no matter how many or how few shares you own.
The Kingston Group urges you NOT to sign any proxy card that is sent to you
by the Company.
<PAGE>
If you have any questions, please call:
Beacon Hill Partners, Inc.
90 Broad Street
20th Floor
New York, NY 10004
(212) 843-8500 (call Collect)
or
Call Toll-Free (800) 755-5001
This Proxy Statement and the accompanying BLUE proxy card are first being
sent or given to stockholders on or about __________, 2000.
-2-
<PAGE>
GENERAL
At the Annual Meeting, three directors are to be elected to the Company's
Board of Directors (the "Board of Directors") to hold office for a three-year
term and until their successors have been elected and qualified. The Kingston
Group is seeking your proxy for the election to the Board of Directors of
William G. Foster, Jr., John R. Kennedy and Vincent A. Smyth.
The Company has reported in its proxy statement relating to the Annual
Meeting (the "Company Proxy Statement") that, as of the Record Date, the
Company's outstanding voting securities consisted of 3,251,734 shares of Common
Stock. Each share of Common Stock entitles its owner to one vote, and a
plurality of votes cast at a meeting at which a quorum is present or otherwise
represented is necessary to elect each of the Kingston Group Nominees. For
information concerning voting procedures at the Annual Meeting, see "Voting and
Proxy Procedures."
REASONS FOR THIS SOLICITATION
The members of the Kingston Group originally joined together so that they
could express to the Company and other shareholders the group's concerns about
management's unwillingness to pursue all strategic alternatives to maximize
shareholder value, including a sale of the Company. The members of the Kingston
Group collectively own 298,302 shares of Common Stock, representing
approximately 9.2% of the outstanding shares of Common Stock. The Kingston Group
has nominated the Kingston Group Nominees for election as directors to help
ensure that the Board of Directors addresses shareholder concerns and considers
all alternatives available to the Company, including a sale of the Company.
The Kingston Group believes that it is the responsibility of a board of
directors to pursue a business strategy that will produce the highest and best
returns to shareholders. The true measurement of how investors assess a
management's strategy is the market price of the company's shares. In the case
of the Company, the Kingston Group believes the past price performance of the
Company's stock as a multiple of estimated earnings indicates that investors
have serious reservations regarding the Company's operating strategy. While the
Company's stock trades at a price to estimated 2000 earnings of 6.29x (p/e
ratio), other Massachusetts thrifts with over $500 million in assets(1) trade at
an average p/e of 8.41x.(2)
The Company's Price/Earnings Ratio Versus Peer Banks
- ----------------------------------------------------
The following table sets forth the price/earnings ratio for the Company and each
of the Peer Banks for the periods indicated. For 1996 through 1999, the ratio is
the stock price on the final trading day of the year to earnings for that year.
For 2000, the ratio is the stock price on April 24, 2000 to estimated 2000
earnings from I/B/E/S.
1996 1997 1998 1999 2000E
Abington Bancorp, Inc. 10.96 19.09 11.86 8.80 7.75
Andover Bancorp, Inc. 10.68 16.18 13.32 9.93 9.22
BostonFed Bancorp, Inc. 30.73 17.64 12.33 9.28 6.74
- ----------
1 Abington Bancorp, Inc., Andover Bancorp, Inc., BostonFed Bancorp, Inc.,
First Essex Bancorp, Inc., MASSBANK Corp., Medford Bancorp, Inc. and
MetroWest Bank (collectively, the "Peer Banks"). Excludes thrifts which
converted from mutual to stock form after 1996.
2 Estimates of 2000 earnings for the Company and for Peer Banks are from
I/B/E/S. Prices for 2000 are as of April 24, 2000.
-3-
<PAGE>
1996 1997 1998 1999 2000E
First Essex Bancorp, Inc. 8.93 18.60 12.77 8.82 8.22
MASSBANK Corp. 11.08 17.19 13.17 9.08 7.97
Medford Bancorp, Inc. 11.60 16.49 12.79 11.55 9.17
MetroWest Bank 11.44 16.98 10.64 10.80 9.79
AVERAGE 13.63 17.45 12.41 9.75 8.41
People's Bancshares, Inc. 9.75 15.48 9.11 6.30 6.29
In the view of the Kingston Group, this valuation discount results from
management's decision to pursue a leveraging strategy and concentrate on its
mortgage origination operation rather than building a core banking franchise. As
illustrated in the table below, in 1999, the Company used substantially more
leverage on a proportionate basis than did other Massachusetts thrifts with over
$500 million in assets.
Leverage Comparison
- -------------------
Leverage Factor*
(At December 31, 1999)
People's Bancshares, Inc. 8.4
Peer Bank Average 3.5
* Leverage factor equals Total Borrowings / (Trust Preferred Securities +
Tangible Equity)
The Company borrowed this money primarily to invest in securities rather
than to engage in the basic banking business of making loans to customers.
Although the Company's securities portfolio has contributed to earnings, the
Kingston Group believes that investors have not given the Company full credit
for those earnings because of the risks associated with incurring significant
leverage to support the investment program.
Even though interest rates were rising throughout 1999 and mortgage
origination businesses were experiencing financial difficulty as a result,
Company management nonetheless spent approximately $1.8 million to acquire
Allied Mortgage, a mortgage company operating in Maryland, Virginia and Florida.
The Kingston Group believes that expanding the mortgage origination business in
the current business environment is not a strategy that is likely to enhance
shareholder value.
In the fall of last year, representatives of the Kingston Group discussed
the Kingston Group's concerns with management and board members and asked that
they consider seeking alternatives to enhance shareholder value. In particular,
the Kingston Group suggested that the Company retain an investment banking firm
to review strategic alternatives to maximize shareholder value, including the
sale of the Company. Company management has dismissed the Kingston Group's
concerns as "inappropriate."
-4-
<PAGE>
Following the Kingston Group's filing of formal notice of its nomination of
the Kingston Group Nominees, members of Company management suggested that the
Company would consider appointing one representative of the Kingston Group to
stand for election with the Company's nominees at the Annual Meeting, provided
that the Kingston Group would enter into a standstill agreement precluding it
from purchasing additional shares of Common Stock or engaging in any proxy
solicitation. The Kingston Group declined this offer because Company management
was unwilling to publicly commit to the Company's exploring all strategic
alternatives and retaining an investment banking firm. In addition, the Kingston
Group does not believe that a single director will necessarily ensure an
adequate voice for the shareholders.
The Kingston Group informed the Company's management that it would consider
withdrawing its nomination of the Kingston Group Nominees if the Company
appointed two representatives of the Kingston Group to the Board of Directors,
publicly announced that it was retaining an investment banking firm and
reimbursed the Kingston Group for any expenses it incurred in connection with
the nomination of the Kingston Group Nominees. The Kingston Group also informed
the Company that it was reluctant to enter into a standstill agreement. The
Company did not accept the Kingston Group's proposal.
The Kingston Group believes that the Board of Directors should examine all
business strategies to maximize shareholder value. Because of the current Board
of Director's lack of responsiveness to shareholder concerns, the Kingston Group
believes it will be in the best interests of shareholders to elect to the Board
members who will actively pursue the realization of shareholder value. If
elected, the Kingston Group Nominees will seek to cause the Board of Directors
to engage an investment banking firm to review strategic alternatives to
maximize shareholder value including the sale of the Company.
THE KINGSTON GROUP STRONGLY RECOMMENDS A VOTE FOR THE ELECTION OF THE
KINGSTON GROUP NOMINEES.
NOMINEES FOR ELECTION AS DIRECTORS
The Company Proxy Statement discloses that the Board of Directors currently
consists of 10 directors divided into three classes, with the directors in each
class serving a term of three years. According to the Company Proxy Statement,
three directors are to be elected at the Annual Meeting. The directors so
elected will serve in such capacity for a three-year term to expire at the 2003
Annual Meeting of Stockholders and until their successors are elected and
qualified.
The Kingston Group is proposing the election of the three Kingston Group
Nominees to the Board of Directors. The Kingston Group does not expect that any
of the Kingston Group Nominees will be unable to stand for election, but in the
event that a vacancy in the slate of the Kingston Group Nominees should occur
unexpectedly, the shares of Common Stock represented by the proxy card furnished
by the Kingston Group will be voted for a substitute candidate selected by the
Kingston Group.
The following information concerning age, principal occupation and business
experience during the last five years, and current directorships has been
furnished to the Kingston Group by the Kingston Group Nominees, all of whom have
expressed their willingness to serve on the Board of Directors if elected.
WILLIAM G. FOSTER, JR. has been President of LACE/Foster Advisory Services,
a firm providing consulting services to financial institutions, since 1996. From
July 1994 to April 1996, Mr. Foster was a Managing Director of Sandler, O'Neill
& Partners, an investment bank, specializing in banks and thrifts. He is 57
years old.
JOHN R. KENNEDY has been an independent financial and management consultant
with Kennedy Consulting since May 1997. From January 1974 through May 1997, Mr.
Kennedy held various positions with Bank Boston of Boston, Massachusetts,
including Senior International Project Director and Senior Financial Officer. He
is 54 years old.
-5-
<PAGE>
VINCENT A. SMYTH has been a partner with the law firm of Smyth & Lack in
Huntington, New York since 1976. From 1985 to 1994, while he was a partner with
Smyth & Lack, he was also general counsel to Bayside Federal Savings Bank. He is
62 years old.
If elected, each Kingston Group Nominee would receive such directors' fees
as may be payable by the Company in accordance with its practice at the time.
There are no other understandings or arrangements between any person in the
Kingston Group and any Kingston Group Nominee relating to the matters
contemplated by this Proxy Statement.
Additional information concerning the Kingston Group Nominees is set forth
in Appendix A and B to this Proxy Statement.
THE KINGSTON GROUP
The following persons are collectively referred to as the Kingston Group:
(i) RCG Kingston Fund, Ltd., (ii) RCG Kingston, L.L.C., (iii) Kingston Fund, LP,
(iv) Ramius Capital Group, LLC, (v) C4S & Co., LLC, (vi) Jennings & Gillen,
(vii) D.B. Jennings, Inc., (viii) Donald B. Jennings, (ix) Thomas F. Gillen, (x)
The Partnership For Bank Capital, L.P. and (xi) Vincent A. Smyth and Mary E.
Smyth.
RCG Kingston Fund, Ltd., a Cayman Islands company, is engaged in the
business of investment.
RCG Kingston, L.L.C., a Delaware limited liability company, is the
investment advisor to RCG Kingston Fund, Ltd. and the general partner of
Kingston Fund, LP.
Kingston Fund, LP, a Delaware limited partnership, is an investment fund
that owns a majority of the outstanding shares of RCG Kingston Fund, Ltd.
Ramius Capital Group, LLC, a Delaware limited liability company, and
Jennings & Gillen, a Delaware general partnership, are the co-managing members
of RCG Kingston, L.L.C.
C4S & Co., LLC, a Delaware limited liability company, is the managing
member of Ramius Capital Group, LLC.
D.B. Jennings, Inc., a Delaware corporation, and Thomas F. Gillen are
co-general partners of Jennings & Gillen. Donald B. Jennings is the president of
D.B. Jennings, Inc.
The Partnership For Bank Capital, L.P., a Delaware limited partnership, is
engaged in the business of investment. D.B. Jennings, Inc. and Donald B.
Jennings are the general partners of The Partnership For Bank Capital, L.P.
Vincent A. Smyth and Mary E. Smyth are an attorney and housewife,
respectively.
As of the Record Date, members of the Kingston Group collectively
beneficially owned (as determined in accordance with the rules under of the
Securities Exchange Act of 1934 (the "Exchange Act")) 298,302 shares of Common
Stock or approximately 9.2% of the outstanding shares of Common Stock.
Additional information concerning the Kingston Group is set forth in
Appendices A and B.
SOLICITATION; EXPENSES
Proxies may be solicited by mail, advertisement, telephone, facsimile,
telegraph and personal solicitation. Proxies may be similarly solicited by the
Kingston Group and by the Kingston Group Nominees. No additional compensation
will be paid to the Kingston Group and to the Kingston Group Nominees for the
solicitation of proxies. Banks, brokerage houses and other custodians, nominees
and fiduciaries will be requested to forward the
-6-
<PAGE>
Kingston Group solicitation material to their customers for whom they hold
shares and the Kingston Group will reimburse them for their reasonable
out-of-pocket expenses.
The Kingston Group has retained Beacon Hill Partners, Inc. ("Beacon Hill")
to assist in the solicitation of proxies and for related services. The Kingston
Group will pay Beacon Hill an estimated fee of up to $30,000 and has agreed to
reimburse it for its reasonable out-of-pocket expenses. Approximately 25 persons
will be used by Beacon Hill in its solicitation efforts.
The entire expense of preparing, assembling, printing and mailing this
Proxy Statement and related materials and the cost of soliciting proxies will be
borne by the Kingston Group.
The Kingston Group estimates that the total expenditures relating to its
proxy solicitation incurred by the Kingston Group will be approximately
$250,000, approximately $120,000 of which has been incurred to date. RCG
Kingston, L.L.C. and Vincent A. Smyth have agreed that the obligation for those
expenses will be allocated evenly between them. The Kingston Group intends to
seek reimbursement from the Company for those expenses incurred by the Kingston
Group if the Kingston Group Nominees are elected to the Board of Directors. It
does not intend to submit the question of such reimbursement to a vote of the
Company's stockholders.
SECURITY OWNERSHIP OF PRINCIPAL STOCKHOLDERS,
DIRECTORS AND MANAGEMENT
See Appendix C for information regarding persons who beneficially own more
than 5% of the Common Stock and the ownership of the Common Stock by Company
management and the members of the Board of Directors.
VOTING AND PROXY PROCEDURES
For the proxy solicited hereby to be voted, the enclosed BLUE proxy card
must be signed, dated and returned to the Kingston Group, c/o Beacon Hill
Partners Inc., 90 Broad Street, 20th Floor, New York, NY 10004 in the enclosed
envelope in time to be voted at the Annual Meeting. If you wish to vote for the
Kingston Group Nominees, you must submit the enclosed BLUE proxy card and must
NOT submit the Company's proxy card, even if you wish to vote for any of the
Company Nominees. If you have already returned the Board of Directors' proxy
card to the Company, you have the right to revoke it as to all matters covered
thereby and may do so by subsequently signing, dating and mailing the enclosed
BLUE proxy card. ONLY YOUR LATEST DATED PROXY WILL COUNT AT THE ANNUAL MEETING.
If your shares are held in the name of a brokerage firm, bank or nominee,
only that entity can vote such shares and only upon receipt of your specific
instruction. Accordingly, please contact the person responsible for your account
and instruct that person to execute on your behalf the BLUE proxy card.
Execution of a BLUE proxy card will not affect your right to attend the
Annual Meeting and to vote in person. Any proxy may be revoked as to all matters
covered thereby at any time prior to the time a vote is taken by (i) filing with
the Clerk of the Company a later dated written revocation, (ii) submitting a
duly executed proxy bearing a later date to the Clerk of the Company or (iii)
attending and voting at the Annual Meeting in person. Attendance at the Annual
Meeting will not in and of itself constitute a revocation.
Election of the Kingston Group Nominees requires the affirmative vote of a
plurality of the votes cast on the matter at the Annual Meeting, assuming a
quorum is present or otherwise represented at the Annual Meeting. Consequently,
only shares of Common Stock that are voted in favor of a particular nominee will
be counted toward such nominee's attaining a plurality of votes. Shares of
Common Stock present at the Annual Meeting that are not voted for a particular
nominee (including broker non-votes) and shares of Common Stock present by proxy
where the stockholder properly withheld authority to vote for such nominee will
not be counted toward such nominee's attainment of a plurality.
-7-
<PAGE>
Shares of Common Stock represented by a valid, unrevoked BLUE proxy card
will be voted as specified. You may vote FOR the election of the Kingston Group
Nominees or withhold authority to vote for the election of the Nominees by
marking the proper box on the BLUE proxy card. You may also withhold your vote
from any of the Kingston Group Nominees by writing the name of such nominee in
the space provided on the BLUE proxy card. If no specification is made, such
shares will be voted FOR the election of all of the Kingston Group Nominees.
Except as set forth in this Proxy Statement, the Kingston Group is not
aware of any other matter to be considered at the Annual Meeting. However, if
the Kingston Group learns of any other proposals made at a reasonable time
before the Annual Meeting, the Kingston Group will either supplement this Proxy
Statement and provide an opportunity to Stockholders to vote by proxy directly
on such matter or will not exercise discretionary authority with respect
thereto. If other proposals are made thereafter the persons named as proxies on
the enclosed BLUE proxy card will vote proxies solicited hereby in their
discretion.
Only holders of record of Common Stock on April 28, 2000, the Record Date
established by the Board of Directors for the Annual Meeting, will be entitled
to vote at the Annual Meeting. If you are a stockholder of record on the Record
Date, you will retain the voting, rights in connection with the Annual Meeting
even if you sell such shares after the Record Date. Accordingly, it is important
that you vote the shares of Common Stock held by you on the Record Date, or
grant a proxy to vote such shares on the BLUE proxy card, even if you sell such
shares after such date.
The Kingston Group believes that it is in your best interest to elect the
Kingston Group Nominees at the Annual Meeting. THE KINGSTON GROUP STRONGLY
RECOMMENDS A VOTE FOR THE ELECTION OF THE KINGSTON GROUP NOMINEES.
-8-
<PAGE>
ADDITIONAL INFORMATION
Reference is made to the proxy statement that will be furnished by the
Board of Directors for information concerning the Company's management, the
procedures for submitting proposals for consideration at the next Annual Meeting
of Stockholders of the Company and certain other matters regarding the Company
and the Annual Meeting. The Company also is required to provide to stockholders
its Annual Report to Stockholders for the year ended December 31, 1999, which
contains certain information as to the Company's financial condition and other
matters. The Kingston Group will not verify, and assumes no responsibility for,
the accuracy or completeness of any such information.
THE KINGSTON GROUP
__________, 2000
-9-
<PAGE>
Appendix A
INFORMATION CONCERNING PARTICIPANTS IN THE PROXY SOLICITATION
The following sets forth the name, business address, and the number of
shares of Common Stock of the Company beneficially owned (as determined in
accordance with Rule 13d-3 under the Exchange Act) as of April 28, 2000 by each
of (i) the Kingston Group Nominees and (ii) each member of the Kingston Group:
<TABLE>
<CAPTION>
Number of Shares of
Common Stock of
the Company Percent of Common
Name Business Address Beneficially Owned(1) Stock of the Company(1)(2)
- ---- ---------------- ------------------ --------------------------
<S> <C> <C> <C>
William G. Foster, Jr. c/o RCG Kingston, L.L.C., 500 *
666 Third Avenue, 26th
Floor, New York, New York
10017
John R. Kennedy c/o RCG Kingston, L.L.C., 0 *
666 Third Avenue, 26th
Floor, New York, New York
10017
Vincent A. Smyth 143 Main Street, 136,500(3) 4.20%
Huntington, New York 11743
RCG Kingston Fund, Ltd. c/o Citco Fund Services 129,800 3.99%
(Cayman Islands) Ltd.,
Corporate Centre, West Bay
Road, Grand Cayman, Cayman
Islands, British West
Indies
RCG Kingston, L.L.C. 666 Third Avenue, 26th 129,800(4) 3.99%
Floor, New York, New York
10017
Kingston Fund, LP c/o RCG Kingston, L.L.C., 129,800(5) 3.99%
666 Third Avenue, 26th
Floor, New York, New York
10017
Ramius Capital Group, LLC c/o RCG Kingston, L.L.C., 129,800(6) 3.99%
666 Third Avenue, 26th
Floor, New York, New York
10017
<PAGE>
C4S & Co., LLC c/o RCG Kingston, L.L.C., 129,800(7) 3.99%
666 Third Avenue, 26th
Floor, New York, New York
10017
Jennings & Gillen c/o RCG Kingston, L.L.C., 129,800(6) 3.99%
666 Third Avenue, 26th
Floor, New York, New York
10017
D.B. Jennings, Inc. c/o RCG Kingston, L.L.C., 161,802(8) 4.98%
666 Third Avenue, 26th
Floor, New York, New York
10017
Donald B. Jennings c/o RCG Kingston, L.L.C., 161,802(9) 4.98%
666 Third Avenue, 26th
Floor, New York, New York
10017
Thomas F. Gillen c/o RCG Kingston, L.L.C., 129,800(10) 3.99%
666 Third Avenue, 26th
Floor, New York, New York
10017
The Partnership For Bank 666 Third Avenue, 26th 32,002 *
Capital, L.P. Floor, New York, New York
10017
Mary E. Smyth 143 Main Street, 136,500(3) 4.20%
Huntington, New York 11743
- ----------
* Less than 1%.
(1) The members of the Kingston Group collectively beneficially own 298,302 shares of Common Stock, representing
approximately 9.2% of the outstanding shares of Common Stock. Each of RCG Kingston Fund, Ltd., RCG Kingston,
L.L.C., Kingston Fund, LP, Ramius Capital Group, LLC, C4S & Co., LLC, Jennings & Gillen, D.B. Jennings, Inc.,
Donald B. Jennings and Thomas F. Gillen expressly disclaims beneficial ownership of any shares of Common Stock
beneficially owned by Vincent A. Smyth and Mary E. Smyth. Each of RCG Kingston Fund, Ltd., RCG Kingston,
L.L.C., Kingston Fund, LP, Ramius Capital Group, LLC, C4S & Co., LLC, Jennings & Gillen and Thomas F. Gillen
expressly disclaims beneficial ownership of any shares of Common Stock beneficially owned by The Partnership
For Bank Capital, L.P.
(2) All percentages are based on the 3,251,734 shares of Common Stock outstanding as of April 28, 2000 according
to the Company Proxy Statement.
(3) Vincent A. and Mary E. Smyth own their shares of Common Stock jointly. They regularly effect purchases of
securities through margin accounts maintained for them with Sandler O'Neill & Partners, L.P. which extends
credit to Vincent A. and Mary E. Smyth as and when required to open or carry positions in the margin accounts,
subject to applicable Federal margin regulations, stock exchange rules and the firm's credit policies.
-2-
<PAGE>
(4) RCG Kingston, L.L.C. may be deemed to be the beneficial owner of the 129,800 shares held for the account of
RCG Kingston Fund, Ltd. as a result of its acting as investment advisor to RCG Kingston Fund, Ltd.
(5) Kingston Fund, LP may be deemed to be the beneficial owner of 129,800 shares held for the account of RCG
Kingston Fund, Ltd. as a result of its being a holder of a majority of the outstanding shares of RCG Kingston
Fund, Ltd.
(6) Ramius Capital Group, LLC and Jennings & Gillen may be deemed to be the beneficial owner of 129,800 shares
held for the account of RCG Kingston Fund, Ltd. as a result of their being co-managing members of RCG
Kingston, L.L.C.
(7) C4S & Co., LLC may be deemed to be the beneficial owner of 129,800 shares held for the account of RCG Kingston
Fund, Ltd. as a result of its being the managing member of Ramius Capital Group, LLC.
(8) D.B. Jennings, Inc. may be deemed to be the beneficial owner of 161,802 shares held for the accounts of RCG
Kingston Fund, Ltd. and The Partnership For Bank Capital, L.P. as a result of its being a co-general partner
of Jennings & Gillen and a co-general partner of The Partnership For Bank Capital, L.P.
(9) Donald B. Jennings may be deemed to be the beneficial owner of 161,802 shares held for the accounts of RCG
Kingston Fund, Ltd. and The Partnership For Bank Capital, L.P. as a result of his being the president of D.B.
Jennings, Inc. and a co-general partner of The Partnership For Bank Capital, L.P.
(10) Thomas F. Gillen may be deemed to be the beneficial owner of 129,800 shares held for the account of RCG
Kingston Fund, Ltd. as a result of his being a co-general partner of Jennings & Gillen.
</TABLE>
----------------------------
Except as set forth in this Proxy Statement or in the Appendices hereto, to
the best knowledge of the Kingston Group, none of the Kingston Group, any of the
persons participating in this solicitation on behalf of the Kingston Group, any
of the Kingston Group Nominees nor any associate of any of the foregoing persons
(i) owns beneficially, directly or indirectly, or has the right to acquire, any
securities of the Company or any parent or subsidiary of the Company, (ii) owns
any securities of the Company of record but not beneficially, (iii) has
purchased or sold any securities of the Company within the past two years, (iv)
has incurred indebtedness for the purpose of acquiring or holding securities of
the Company, (v) is or has been a party to any contract, arrangement or
understanding with respect to any securities of the Company within the past
year, (vi) has been indebted to the Company or any of its subsidiaries since the
beginning of the Company's last fiscal year or (vii) has any arrangement or
understanding with respect to future employment by the Company or with respect
to any future transactions to which the Company or any of its affiliates will be
or may be a party. In addition, except as set forth in this Proxy Statement or
in the Appendices hereto, to the best knowledge of the Kingston Group, none of
the Kingston Group, any of the persons participating in this solicitation on
behalf of the Kingston Group, any of the Kingston Group Nominees, nor any
associate of any of the foregoing persons has had or is deemed to have a direct
or indirect material interest in any transaction with the Company since the
beginning of the Company's last fiscal year, or in any proposed transaction, to
which the Company or any of its affiliates was or is a party.
None of the corporations or organizations in which any of the Kingston
Group Nominees has conducted his principal occupation or employment was a
parent, subsidiary or other affiliate of the Company, and none of the Kingston
Group Nominees holds any position or office with the Company, has any family
relationship with any executive officer or director of the Company or each
other, or has been involved in any legal proceedings of the type required to be
disclosed by the rules governing this solicitation.
-3-
<PAGE>
Appendix B
TRANSACTIONS IN SHARES OF PEOPLE'S BANCSHARES, INC.
The following table sets forth information with respect to all purchases
and sales of shares of Common Stock by members of the Kingston Group and their
associates, affiliates and the Kingston Group Nominees during the past two
years:
<TABLE>
<CAPTION>
Date of Nature of Number of Price Per
For the account of: Transaction Transaction Shares Share
- ------------------ ----------- ----------- --------- ---------
<S> <C> <C> <C> <C>
RCG Kingston Fund, Ltd. 5/1/98 Purchase 3,000 $27.88
5/1/98 Purchase 8,000 27.87
6/3/98 Purchase 5,000 26.63
6/10/98 Purchase 5,000 25.25
10/30/98 Purchase 5,000 21.03
11/6/98 Purchase 3,000 21.13
11/17/98 Purchase 5,000 20.75
12/9/98 Purchase 7,500 20.94
12/31/98 Purchase 2,800 20.47
9/13/98 Purchase 3,000 18.13
9/14/98 Purchase 3,000 18.25
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
Date of Nature of Number of Price Per
For the account of: Transaction Transaction Shares Share
- ------------------ ----------- ----------- --------- ---------
<S> <C> <C> <C> <C>
The Partnership for 8/26/98 Purchase 2,000 $16.53
Bank Capital, L.P.
11/6/98 Purchase 3,000 21.13
11/17/98 Purchase 2,500 20.76
12/11/98 Purchase 8,000 20.89
2/2/99 Purchase 2,000 20.98
2/9/99 Purchase 4,000 20.53
9/13/99 Purchase 2,000 18.14
9/14/99 Purchase 2,000 18.26
</TABLE>
-2-
<PAGE>
<TABLE>
<CAPTION>
Date of Nature of Number of Price Per
For the account of: Transaction Transaction Shares Share
- ------------------ ----------- ----------- --------- ---------
<S> <C> <C> <C> <C>
Vincent A. Smyth and 6/20/97 Purchase 5,000 $14.625
Mary E. Smyth
9/25/97 Purchase 5,000 16.000
1/22/98 Purchase 10,000 20.500
5/29/98 Purchase 5,000 25.750
6/9/98 Purchase 5,000 25.000
7/8/98 Purchase 2,500 23.500
8/13/98 Purchase 5,000 19.625
9/15/98 Purchase 5,000 15.125
2/10/99 Purchase 2,500 20.625
2/11/99 Purchase 2,500 20.675
3/1/99 Purchase 2,500 20.500
3/17/99 Purchase 5,000 19.875
3/19/99 Purchase 7,500 19.750
3/23/99 Purchase 7,000 19.825
6/9/99 Purchase 5,000 19.625
6/10/99 Purchase 3,000 19.375
6/11/99 Purchase 10,000 19.625
6/17/99 Purchase 10,000 19.625
6/25/99 Purchase 2,500 20.250
8/27/99 Purchase 16,500 18.875
9/1/99 Purchase 5,000 18.094
9/27/99 Purchase 10,000 18.750
12/3/99 Purchase 5,000 19.125
</TABLE>
-3-
<PAGE>
<TABLE>
<CAPTION>
Date of Nature of Number of Price Per
For the account of: Transaction Transaction Shares Share
- ------------------ ----------- ----------- --------- ---------
<S> <C> <C> <C> <C>
William G. Foster, Jr. 11/3/99 Purchase 500 $17.75
Date of Nature of Number of Price Per
For the account of: Transaction Transaction Shares Share
- ------------------ ----------- ----------- --------- ---------
<S> <C> <C> <C> <C>
John R. Kennedy 3/21/00 Purchase 1,000 $17.25
</TABLE>
-4-
<PAGE>
Appendix C
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS
The following table sets forth, to the knowledge of Kingston Group based on
a review of publicly available information filed with the Securities and
Exchange Commission, each person (who is not a director) reported to own
beneficially more than 5% of the outstanding Common Stock: (1)
<TABLE>
<CAPTION>
Amount and Nature of Beneficial
Name and Address of Ownership of
Beneficial Owner Common Stock Percent of Class
---------------- ------------ ----------------
<S> <C> <C>
Dearden, Maguire & Weaver
One Tower Bridge, Suite 560
West Conshohocken, PA 19428 226,133 6.60%
Dimensional Fund Advisors, Inc.
1299 Ocean Avenue, 11th Floor
Santa Monica, CA 90401 168,669 4.93%
Kingston Group
c/o RCG Kingston, L.L.C.
666 Third Avenue, 26th Floor
New York, New York 10017 298,302(2) 9.17%
Tontine Partners, L.P.
200 Park Avenue, Suite 3900
New York, NY 10166 194,598 5.68%
- ------------------------
(1) All such information was obtained from the Company Proxy Statement.
(2) Each of RCG Kingston Fund, Ltd., RCG Kingston, L.L.C., Kingston Fund, LP,
Ramius Capital Group, LLC, C4S & Co., LLC, Jennings & Gillen, D.B.
Jennings, Inc., Donald B. Jennings and Thomas F. Gillen expressly disclaims
beneficial ownership of any shares of Common Stock beneficially owned by
Vincent A. Smyth and Mary E. Smyth. Each of RCG Kingston Fund, Ltd., RCG
Kingston, L.L.C., Kingston Fund, LP, Ramius Capital Group, LLC, C4S & Co.,
LLC, Jennings & Gillen and Thomas F. Gillen expressly disclaims beneficial
ownership of any shares of Common Stock beneficially owned by The
Partnership For Bank Capital, L.P.
</TABLE>
<PAGE>
SECURITY OWNERSHIP OF MANAGEMENT
The following table sets forth information as of April 28, 2000 with
respect to the beneficial ownership of shares of Common Stock by each of the
Company's directors and executive officers and all directors and executive
officers as a group:(1)
<TABLE>
<CAPTION>
Number of Shares of
Common Stock Percent of
Name Beneficially Owned Common Stock(2)
---- ------------------ ---------------
<S> <C> <C>
Directors (Other than Executive Officers)
Frederick W. Adami, III.................................. 11,516(3) *
B. Benjamin Cavallo...................................... 223,272(4) 6.52%
John R. Eaton............................................ 17,996(5) *
Terrence A. Gomes........................................ 5,016(6) *
Dr. Loring C. Johnson.................................... 11,391(7) *
Richard D. Matthews...................................... 28,319(8) *
Scott W. Ramsay.......................................... 2,600(9) *
Davis H. Scudder......................................... 17,825(10) *
Stanley D. Siskind....................................... 14,117(11) *
Executive Officers ...........................................
Colin C. Blair........................................... 104,150(12) 3.04%
Richard S. Straczynski................................... 68,000(13) 1.99%
All directors and executive officers as a group including
persons named above
(11 persons).................................................. 482,661(14) 14.73%
- -----------------------
*Less than 1 percent.
(1) All such information was obtained from the Company Proxy Statement.
(2) For purposes of calculating the percentage of the outstanding shares of Common Stock at February
1, 2000 for each listed person, the number of shares of Common Stock includes shares that may be
acquired by such person within 60 days of February 1, 2000 through the exercise of vested stock
options under the Company's Amended and Restated Incentive and Nonqualified Stock Option Plan (the
"1986 Employee Option Plan"), the Company's Amended and Restated Directors' Stock Option Plan (the
"1986 Director Option Plan") and the Company's 1996 Stock Option and Incentive Plan (the "1996
Option Plan" and collectively the "Stock Option Plans") but does not include the number of shares
underlying such options held by any other person.
(3) Includes 9,516 shares which Mr. Adami has the right to acquire within 60 days of February 1, 2000,
through the exercise of vested stock options granted under the 1986 Director Option Plan and 1996
Option Plan. Also includes 1,500 shares owned by Mr. Adami jointly with his wife, and 500 shares
owned by Mr. Adami's daughters.
(4) Includes 4,916 shares which Mr. Cavallo has the right to acquire within 60 days of February 1,
2000, through the exercise of vested stock options granted under the 1986 Director Option Plan and
1996 Option Plan. Also includes 2,112 shares held by Mr. Cavallo's son, 115,514 shares held by Mr.
Cavallo's wife, and 55,060 shares held by a partnership in which Mr. Cavallo is a partner.
(5) Includes 9,516 shares which Mr. Eaton has the right to acquire within 60 days of February 1, 2000,
through the exercise of vested stock options granted under the 1986 Director Option Plan and 1996
Option Plan. Also includes 7,980 shares owned by Mr. Eaton jointly with his wife.
(6) Includes 4,916 shares which Mr. Gomes has the right to acquire within 60 days of February 1, 2000,
through the exercise of vested stock options granted under the 1986 Director Option Plan and 1996
Option Plan.
-2-
<PAGE>
(7) Includes 9,516 shares which Dr. Johnson has the right to acquire within 60 days of February 1,
2000, through the exercise of vested stock options granted under the 1986 Director Option Plan and
1996 Option Plan.
(8) Includes 9,516 shares which Mr. Matthews has the right to acquire within 60 days of February 1,
2000, through the exercise of vested stock options granted under the 1986 Director Option Plan and
1996 Option Plan. Also includes 4,871 shares owned by Mr. Matthews jointly with his wife.
(9) Includes 2,000 shares which Mr. Ramsay has the right to acquire within 60 days of February 1,
2000, through the exercise of vested stock options granted under the 1986 Director Option Plan and
1996 Option Plan and 600 shares owned by Mr. Ramsay jointly with his wife.
(10) Includes 9,516 shares which Mr. Scudder has the right to acquire within 60 days of February 1,
2000, through the exercise of vested stock options granted under the 1986 Director Option Plan and
1996 Option Plan. Also includes 340 shares owned by members of Mr. Scudder's immediate family,
2,555 shares owned by Scudder Bros. Fuel Company, Inc., of which Mr. Scudder is a principal and
1,200 shares owned by Campello Salvage of which Mr. Scudder is a partner.
(11) Includes 4,916 shares which Mr. Siskind has the right to acquire within 60 days of February 1,
2000, through the exercise of vested stock options granted under the 1986 Director Option Plan and
1996 Option Plan.
(12) Includes 23,500 shares which Mr. Blair has the right to acquire within 60 days of February 1,
2000, through the exercise of vested stock options granted under the 1986 Employee Option Plan and
1996 Option Plan. Also includes approximately 23,675 shares which may be deemed beneficially owned
by Mr. Blair through his interest in the Bank's 401(k) plan, which invests in the Company's Common
Stock.
(13) Includes 49,500 shares which Mr. Straczynski has the right to acquire within 60 days of February
1, 2000, through the exercise of vested stock options granted under the 1986 Option Plan.
(14) Includes 137,328 shares which directors and executive officers have the right to acquire within 60
days of February 1, 2000, through the exercise of vested stock options granted under one or more
of the Stock Option Plans.
</TABLE>
-3-
<PAGE>
<TABLE>
<CAPTION>
<S> <C> <C>
X PLEASE MARK
- --- VOTED AS IN
THIS EXAMPLE
PEOPLE'S BANCSHARES, INC. 1. Election of Directors. For All With- For All
Nominees hold Except
William G. Foster, Jr.
John R. Kennedy [ ] [ ] [ ]
Vincent A. Smyth
If you do not wish your shares voted "For" a
particular nominee, mark the "For All
Except" box and strike a line through the
name(s) of the nominee(s). Your shares will
be voted for the remaining nominee(s).
To transact such other business as may properly
come before the meeting or any adjournment
thereof.
The undersigned stockholder(s) authorize(s) the
proxies to vote on the above matter as indicated
and to vote, in their discretion, upon such other
matters as may properly come before the Annual
Meeting or any adjournments or postponements
thereof.
Please be sure to sign and date this Proxy. Date
----------------------
- -------------------------------------------------------------------------------------------------
Stockholder sign here Co-owner sign here
</TABLE>
<PAGE>
PEOPLE'S BANCSHARES, INC.
THIS PROXY IS SOLICITED ON BEHALF OF THE KINGSTON GROUP
The undersigned stockholder of People's Bancshares, Inc. (the "Company") hereby
appoints Thomas F. Gillen, Donald B. Jennings and Vincent A. Smyth, and each of
them, with several powers of substitution, as proxies to cast all votes which
the undersigned stockholder is entitled to cast at the Annual Meeting of
Stockholders (the "Annual Meeting") to be held at 10:00 a.m., local time, on
Friday, June 16, 2000 at Stone Forge Public House, 90 Paramount Drive, Raynham,
Massachusetts, and at any adjournments or postponements thereof. The undersigned
stockholder hereby revokes any proxy or proxies heretofore given.
This proxy will be voted as directed by the undersigned stockholder. UNLESS
CONTRARY DIRECTION IS GIVEN, THIS PROXY WILL BE VOTED "FOR" THE ELECTION OF THE
NOMINEES LISTED IN PROPOSAL 1 AND IN ACCORDANCE WITH THE DETERMINATION OF THE
PROXY HOLDERS AS TO OTHER MATTERS. The undersigned stockholder hereby
acknowledges receipt of the and Kingston Group Proxy Statement.
The undersigned stockholder may revoke this proxy at any time prior to its
exercise by filing a written notice of revocation with, or by delivering a duly
executed proxy bearing a later date to, the Clerk of the Company or by attending
the Annual Meeting of Stockholders.
PLEASE VOTE, DATE AND SIGN ON REVERSE AND RETURN PROMPTLY IN THE
ENCLOSED ENVELOPE.
Please sign exactly as your name(s) appear(s) on the books of the Company. Joint
owners should each sign personally. Trustees and other fiduciaries should
indicate the capacity in which they sign, and where more than one name appears,
a majority must sign. If a corporation, this signature should be that of an
authorized officer who should state his or her title.
