EXHIBIT 10.1
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UNION BANKSHARES, INC.
SHAREHOLDER AGREEMENT
SHAREHOLDER AGREEMENT by and among Citizens Savings Bank and Trust Company,
a Vermont-chartered commercial bank, ("CSBT") and the directors, executive
officers and 5% or more shareholders of Union Bankshares, Inc., a Vermont
corporation ("Union") , named on Schedule I hereto (collectively, the
"Shareholders"), and joined in by Union.
WITNESSETH:
WHEREAS, Union and CSBT have entered into an Affiliation Agreement,
dated as of the date hereof (the "Affiliation Agreement"), which is being
executed simultaneously with the execution of this Shareholder Agreement
and which provides for, among other things, the affiliation of Union and CSBT
through the merger of CSBT with a wholly owned subsidiary of Union to be
organized by Union for the sole purpose of effecting the affiliation, under
the corporate charter and name of CSBT (the "Merger");
WHEREAS, in connection with the Merger, each of CSBT's shareholders
will receive 6.5217 shares of Common Stock of Union, $2.00 par value per
share (the "Union Common Stock") for each outstanding share of Common Stock
of CSBT, $1.00 par value per share (the "CSBT Common Stock") held by such
CSBT shareholder at the effective time of the Merger; and
WHEREAS, in order to induce CSBT to enter into the Affiliation
Agreement, each of the undersigned Shareholders desires to provide binding
assurances to Union that the undersigned, in his or her capacity as a
Shareholder of Union, will vote his or her shares of Union Common Stock in
favor of an amendment to the Articles of Incorporation of Union to increase
the number of authorized shares of Union Common Stock for the purpose of
effectuating the transactions contemplated in the Affiliation Agreement;
NOW, THEREFORE, in consideration of the premises, the mutual
covenants and agreements set forth herein and other good and valuable
consideration, the sufficiency of which is hereby acknowledged, the parties
hereto agree as follows:
Section 1. Ownership of Union Common Stock
Each Shareholder represents and warrants that the Shareholder has
beneficial ownership of shares of Union Common Stock set forth opposite such
Shareholder's name on
Schedule I to this Agreement. To the best knowledge of each of the
Shareholders and Union, the Shareholders listed on Schedule I constitute all
of the directors, executive officers and beneficial owners of 5% or more of
the outstanding Union Common Stock.
Section 2. Covenants of the Shareholders
Each Shareholder covenants and agrees that:
(a) At any meeting of Union's Shareholders called for the purpose,
such Shareholder will vote, or cause to be voted, all shares of Union
Common Stock over which such Shareholder has the right to vote
(whether owned as of the date hereof or hereafter acquired) (i) in
favor an amendment to the Articles of Incorporation of Union to
increase the number of authorized shares of Union Common Stock for the
purpose of effectuating the transactions contemplated in the
Affiliation Agreement, (ii) in favor of any related matters presented
for shareholder vote in order to effectuate the transactions
contemplated in the Affiliation Agreement, and (iii) against any
Acquisition Transaction involving Union and any Person, entity or group
(other than CSBT);
(b) Such Shareholder will not directly or indirectly encourage or
solicit or hold discussions or negotiations with, or provide any
information to, any Person, entity or group (other than CSBT)
concerning any Acquisition Transaction with respect to Union (provided
that nothing herein shall be deemed to impair the ability of any
Shareholder, in good faith and upon the advice of counsel, to fulfill
his or her duties as a director or officer of Union); and
(c) Such Shareholder will not sell, transfer, assign or otherwise
voluntarily dispose of any of the Union Common Stock beneficially
owned by such Shareholder, without the prior written consent of CSBT,
which consent may be withheld by CSBT in its sole discretion or may
be conditioned upon the transferee's written agreement to be bound by
this Agreement.
Each Shareholder agrees that appropriate stop transfer orders shall
be entered in Union's stock transfer records and that Union shall not register
any transfer or attempted transfer of shares of Union Common Stock
beneficially owned by such Shareholder during the term of this Agreement.
Each Shareholder further agrees that this Shareholder Agreement shall
constitute an irrevocable proxy, coupled with an interest, in favor of
CSBT, to vote all of the shares of Union Common Stock owned of record by such
Shareholder at any meeting of the Union Shareholders called to vote upon any
of the matters specified in Section 2(a) above.
Section 3. Beneficial Ownership
For purposes of this Agreement, beneficial ownership of Union Common
Stock will be determined in accordance with Rule 13d-3 under the Exchange
Act.
Section 4. Binding Effect; Enforcement
The parties agree and intend that (i) this Shareholder Agreement will
be a valid and binding agreement, enforceable against the parties hereto
according to its terms; (ii) damages and other remedies at law for the
breach of this Agreement are inadequate; and (iii) CSBT shall be entitled
to specific performance of the obligations of the Shareholders and Union
hereunder.
Section 5. Obligations Severable; Termination
The breach of any provision of this Agreement by any Shareholder will
not relieve any other Shareholder of its obligations hereunder. This
Agreement may be terminated at any time prior to the consummation of the
Merger by mutual written consent of all of the parties hereto and shall be
automatically terminated in the event that the Affiliation Agreement is
terminated in accordance with its terms.
Section 6. Notices
Notices may be provided to CSBT and Union in the manner specified in
Section 8.05 of the Affiliation Agreement, with all notices to the
Shareholders being provided to them c/o Union at the address and in the
manner specified in such section.
Section 7. Governing Law
This Agreement shall be governed by the laws of the State of Vermont.
Section 8. Counterparts
This Agreement may be executed in one or more counterparts, all of
which shall be considered one and the same and each of which shall be
deemed an original.
Section 9. Headings and Gender
The Section headings contained herein are for reference purposes only
and shall not affect in any way the meaning or interpretation of this
Shareholder Agreement. Use of the
masculine gender herein shall be considered to represent the masculine,
feminine or neuter gender whenever appropriate.
Section 10. Defined Terms
Capitalized terms which are used but not defined herein shall have
the meanings ascribed to such terms in the Affiliation Agreement.
Section 11. Construction and Interpretation
This Agreement shall be deemed to have been prepared jointly by the
parties hereto and any uncertainty or ambiguity existing herein shall not
be interpreted against any party by reason of its drafting of this
Agreement, but shall be interpreted according to the application of rules
of interpretation for arms' length agreements.
IN WITNESS WHEREOF, CSBT and Union, each by a duly authorized officer, and
each of the undersigned Shareholders, individually and in all
representative capacities, have executed this Shareholder Agreement as of
this 16th day of February, 1999.
CITIZENS SAVINGS BANK AND TRUST COMPANY
By: /s/ Xxxxx X. Xxxx
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Xxxxx X. Xxxx
President and Chief Executive Officer
UNION BANKSHARES, INC.
By: /s/ Xxxxxxx X. Xxxxxxx
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Xxxxxxx X. Xxxxxxx
President and Chief Executive Officer
Union SHAREHOLDERS:
/s/ Xxxxxxx X. Xxxxx /s/ Xxxxxx X. Xxxxxxx
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Xxxxxxx X. Xxxxx Xxxxxx X. Xxxxxxx
/s/ Xxxxx Xxxxxxxxx /s/ Xxxxxx X. Xxxxxxx
------------------------------ -------------------------------
Xxxxx Xxxxxxxxx Xxxxxx X. Xxxxxxx
/s/ Xxxxxxx X. Xxxxxxx /s/ Xxxxxxx X. Xxxxxxx
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Xxxxxxx X. Xxxxxxx Xxxxxxx X. Xxxxxxx
/s/ Xxxxx X. Xxxxxx /s/ Xxxxxx X. Xxxxxxx
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Xxxxx X. Xxxxxx Xxxxxx X. Xxxxxxx
/s/ Xxxxxxx X. Xxxxxx /s/ W. Xxxxx Xxxxx
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Xxxxxxx X. Xxxxxx W. Xxxxx Xxxxx
/s/ Xxxxxxx X. Xxxxxx XXXXXX FUND, INC.
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Xxxxxxx X. Xxxxxx
By: /s/ Xxxxxxx X. Xxxxxxx
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Xxxxxxx X. Xxxxxxx, Trustee
By: /s/ Xxxxxx Xxxxxx
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Xxxxxx Xxxxxx, Trustee
SCHEDULE I
UNION BANKSHARES, INC.
5% OR MORE SHAREHOLDERS
Number of Shares of
Union Common Stock
Name of Shareholder/ Director/ Officer Beneficially Owned
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Xxxxxxx X. Xxxxx 520
Xxxxx Xxxxxxxxx 24,000
Xxxxxxx X. Xxxxxxx 19,730
Xxxxx X. Xxxxxx 55,000
Xxxxxxx X. Xxxxxx 30,020
Xxxxxxx X. Xxxxxx 1,010
Xxxxxx X. Xxxxxxx 0
Xxxxxx X. Xxxxxxx 1,000
Xxxxxxx X. Xxxxxxx 29,889
Xxxxxx X. Xxxxxxx 299,945
W. Xxxxx Xxxxx 141,332
XXXXXX FUND, INC. 108,000
