SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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 / /
Check the appropriate box:
/ / Preliminary Proxy Statement
/X/ Definitive Proxy Statement
/ / Definitive Additional Materials
/ / Soliciting Material Pursuant to Exchange Act Rule 14a-11(c) or 14a-12
UNIVEST CORPORATION OF PENNSYLVANIA
- -----------------------------------------------------------------------------
(Name of Registrant as Specified in Its Charter)
-----------------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement)
1) Title of each class of securities to which transaction applies:
----------------------------------------------------------------------
2) Aggregate number of securities to which transaction applies:
----------------------------------------------------------------------
3) Per unit or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11:
----------------------------------------------------------------------
4) Proposed maximum aggregate value of transaction:
----------------------------------------------------------------------
/ / 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:
___________________________________________________________________________
Set forth the amount on which the filing fee is calculated and state how it
was determined.
[LOGO] UNIVEST
-------
CORPORATION OF PENNSYLVANIA
14 North Main Street
Souderton, Pennsylvania 18964
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
APRIL 10, 2001
--------------
TO THE HOLDERS OF COMMON STOCK:
The Annual Meeting of Shareholders of Univest Corporation of Pennsylvania
will be held on Tuesday, April 10, 2001, at 10:45 in the morning, in the Univest
Building, 14 North Main Street, Souderton, Pennsylvania.
Univest's Board of Directors recommends a vote:
1. FOR the election of four Class II directors for a three-year term
expiring in 2004.
2. FOR the election of two alternate directors for a one-year term
expiring in 2002.
3. FOR the approval of Amendment No. 2 to the Long-Term Incentive Plan.
4. FOR the ratification of the selection of Ernst & Young LLP as the
Corporation's independent certified public accountant for the year
2001.
Other business, of which none is anticipated, as may properly come before
the meeting or any postponements or adjournments thereof will be transacted.
The close of business on March 2, 2001, has been fixed by the Board of
Directors as the record date for the determination of shareholders entitled to
notice of and to vote at the annual meeting.
The accompanying proxy statement forms a part of this notice.
SEPARATE PROXY CARDS ARE ENCLOSED TO SHAREHOLDERS FOR THE PURPOSE OF
VOTING ALL THEIR SHARES OF THE CORPORATION'S COMMON STOCK. ALL CARDS SHOULD BE
SIGNED AND RETURNED SO THAT ALL YOUR SHARES MAY BE VOTED.
IT IS IMPORTANT THAT EACH SHAREHOLDER EXERCISE HIS/HER RIGHT TO VOTE.
Whether or not you plan to attend the meeting, we urge that you execute and
return your proxy cards as soon as possible in the enclosed postage-paid
envelope, in order that your shares will be represented at the meeting. If you
attend the meeting, you may vote in person.
By Order of the Board of Directors
MARVIN A. ANDERS
CHAIRMAN
NORMAN L. KELLER
March 8, 2001 SECRETARY
PROXY STATEMENT
Univest Corporation of Pennsylvania (Univest or Corporation) is a
multi-bank holding company organized by Union National Bank and Trust Company of
Souderton under the Bank Holding Company Act of 1956, as amended. Univest
elected to become a Financial Holding Company in 2000 as provided under Title I
of the Gramm-Leach-Bliley Act, and is subject to supervision by the Federal
Reserve System. Principal subsidiaries of the Corporation are Union National
Bank and Trust Company of Souderton (Union) and Pennview Savings Bank
(Pennview).
The accompanying proxy is solicited by the Board of Directors (Board) of
Univest Corporation of Pennsylvania, 14 North Main Street, Souderton,
Pennsylvania 18964, for use at the Annual Meeting of Shareholders to be held
April 10, 2001, and at any adjournment thereof. Copies of this proxy statement
and proxies to vote the Common Stock are being sent to the shareholders on or
about March 8, 2001. Any shareholder executing a proxy may revoke it at any time
by giving written notice to the Secretary of the Corporation before it is voted.
Some of the officers of the Corporation or employees of its direct subsidiaries,
including Union and Pennview and other subsidiary companies, may solicit proxies
personally and by telephone, if deemed necessary. The Corporation will bear the
cost of solicitation and will reimburse brokers or other persons holding shares
of the Corporation's voting stock in their names, or in the names of their
nominees, for reasonable expense in forwarding proxy cards and proxy statements
to beneficial owners of such stock.
The persons named in the proxy will vote in accordance with the
instructions of the shareholder executing the proxy, or in the absence of any
such instruction, for or against on each matter in accordance with the
recommendations of the Board of Directors set forth in the proxy.
Univest's Board of Directors recommends a vote:
1. FOR the election of the four Class II directors nominated by the
Board for a three-year term.
2. FOR the election of the two alternate directors nominated by the
Board for a one-year term.
3. FOR the approval of Amendment No. 2 to the Long-Term Incentive Plan.
4. FOR the ratification of the selection of Ernst & Young LLP as the
Corporation's independent certified public accountant for the year
2001.
The Board of Directors has fixed the close of business on March 2, 2001,
as the record date for the determination of shareholders entitled to notice and
to vote at the Annual Meeting. As of March 2, 2001, there were issued 8,207,496
and 7,173,518 outstanding shares of Common Stock (exclusive of 1,033,978 shares
held as treasury stock which will not be voted).
Holders of record of the Corporation's Common Stock will be entitled to
one vote per share on all business of the meeting. The matters of business
listed in this proxy will be decided by majority vote of the shares represented
at the meeting. Certain other matters, of which none are anticipated to be voted
upon at the meeting, may require super majority approval as specified by the
amended Articles of Incorporation. The presence in person or by proxy of the
holders of 66 2/3% of the outstanding shares of Common Stock will constitute a
quorum for the transaction of business at the meeting.
Union National Bank and Trust Company of Souderton holds 1,480,919 shares
or 20% of the Corporation's Common Stock in various trust accounts in a
fiduciary capacity in its Trust Department. No one trust account has 5% or more
of the Corporation's Common Stock.
As of February 9, 2001, executive officers, directors, and nominees for
Class II Directors and Alternate Directors as a group beneficially owned 963,707
shares of the Corporation's Common Stock. The group consists of 16 persons.
A copy of the Annual Report to Shareholders, including financial
statements for the year ended December 31, 2000, has been mailed to each
shareholder of record on March 2, 2001. The Annual Report is not a part of the
proxy soliciting material.
ELECTION OF DIRECTORS
The persons named in the accompanying proxy intend to vote to elect as
directors the nominees listed below in each case, unless authority to vote for
directors is withheld in the proxy. The Bylaws authorize the Board of Directors
to fix the number of Directors to be elected from time to time. By proper
motion, they have established the number at four Class II Directors to be
elected for a three-year term expiring in 2004 and a pool of two Alternate
Directors for a one-year term expiring in 2002.
Management is informed that all the nominees are willing to serve as
directors, but if any of them should decline or be unable to serve, the persons
named in the proxy will vote for the election of such other person or persons as
may be designated by the Board of Directors, unless the Board of Directors
reduces the number of directors in accordance with the Corporation's Bylaws.
NOMINEES: *
The following information, as of February 9, 2001, is provided with
respect to the nominees for election to the Board.
SHARES OF
COMMON STOCK
NAME, AGE & YEAR OF BENEFICALLY
ELECTION AS DIRECTOR** BUSINESS EXPERIENCE OWNED 2/09/01***
CLASS II (TO BE ELECTED FOR A THREE-YEAR TERM EXPIRING 2004):
James L. Bergey 65 (1984) President, Abram W. Bergey and 14,685(1)
Sons, Inc. (Floor Coverings)
Clair W. Clemens 70 (1984) Retired, Hatfield Quality Meats, Inc. 10,313
(Pork Processing)
Charles H. Hoeflich 86 (1962) Chairman Emeritus of the Corporation 236,710
John U. Young 62 (1988) President, Alderfer, Inc. 8,925
(Meat Processing)
ALTERNATE DIRECTORS (TO BE ELECTED FOR A ONE-YEAR TERM EXPIRING 2002):
Richard W. Godshall 67 (1999) Physician, Upper Bucks Orthopaedic Association
2,048
Margaret K. Zook 55 (1999) Administrator, Souderton Mennonite Homes 408
(Retirement Community)
2
THE FOLLOWING DIRECTORS ARE NOT SUBJECT TO ELECTION NOW AS THEY WERE ELECTED IN
PRIOR YEARS FOR TERMS EXPIRING IN FUTURE YEARS.
CLASS III (CONTINUING FOR A TERM EXPIRING 2002):
Marvin A. Anders 61 (1996) Chairman of the Corporation 138,745(2)
and Chairman of Union National Bank
R. Lee Delp 54 (1994) President and CEO, Moyer Packing Company, Inc. 4,314
(Beef Packers and Renderers)
H. Ray Mininger 60 (1995) **** President, H. Mininger & Son, Inc. 7,240
(General Contractor)
P. Gregory Shelly 55 (1985) President, Shelly Enterprises, Inc. 49,222(3)
(Building Materials)
CLASS I (CONTINUING FOR A THREE-YEAR TERM EXPIRING 2003):
William S. Aichele 50 (1990) President and CEO of the Corporation and 114,473(4)
President and CEO of Union National Bank
Norman L. Keller 63 (1974) Executive Vice President of the 35,309(5)
Corporation and President and CEO of
Pennview Savings Bank
Thomas K. Leidy 62 (1984) Chairman & President, Leidy's, Inc. 156,511(6)
(Pork Processing)
Merrill S. Moyer 66 (1984) Retired Chairman of the Corporation and 166,196(7)
Retired Chairman of Union National Bank
- -------------------------
* All nominees now are directors or alternate directors respectively. All
nominees are non-management directors.
** Dates indicate initial year as a director or alternate director of UNIVEST
or the subsidiary banks.
*** The shares Beneficially owned" may include shares owned by or for, among
others, the spouse and/or minor children of the individuals and any other
relative who has the same home as such individual, as well as other shares
as to which the individual has or shares voting or investment power.
Beneficial ownership may be disclaimed as to certain of the securities.
Each nominee beneficially owns less than 1% of the outstanding shares of
the Common Stock of UNIVEST with the exception of Charles H. Hoeflich
(3.30%).
**** Harold M. Mininger retired as a director in 2000 and the Board of
Directors elected Alternate Director H. Ray Mininger to fill the unexpired
term as a Class III Director.
(1) Includes 732 shares owned by a member of
Mr. Bergey's family. He disclaims beneficial ownership of these shares.
(2) Includes 92,250 shares in the Univest Deferred Salary Savings Plan of which
Mr. Anders is a co-trustee and 20,359 shares owned by a member of his
family. He disclaims beneficial ownership of these shares.
(3) Includes 18,445 shares owned by members of Mr. Shelly's family. He
disclaims beneficial ownership of these shares.
(4) Includes 92,250 shares in the Univest Deferred Salary Savings Plan of which
Mr. Aichele is a co-trustee. He disclaims beneficial ownership of these
shares.
(5) Includes 24,307 shares owned by members of Mr. Keller's family. He
disclaims beneficial ownership of these shares.
(6) Includes 92,250 shares in the Univest Deferred Salary Savings Plan of which
Mr. Leidy is a co-trustee, 4,204 shares owned by a member of his family,
and 19,672 shares over which he shares voting and/or investment power. He
disclaims beneficial ownership of these shares.
(7) Includes 92,250 shares in the Univest Deferred Salary Savings Plan of which
Mr. Moyer is a co-trustee, and 24,819 shares owned by a member of his
family. He disclaims beneficial ownership of these shares.
3
Under federal securities law, the Corporation's directors, certain
officers, and persons holding more than ten percent of any class of the
Corporation's common stock are required to report, within specified monthly and
annual due dates, their initial ownership in any class of the Corporation's
common stocks and all subsequent acquisitions, dispositions or other transfers
of interest in such securities, if and to the extent reportable events occur
which require reporting by such due dates. The Corporation is required to
describe in this proxy statement whether it has knowledge that any person
required to file such a report may have failed to do so in a timely manner. The
Corporation does not have knowledge of any untimely filing.
ADOPTION OF AMENDMENT NO. 2 TO THE LONG-TERM INCENTIVE PLAN
On February 24, 1993, the Board of Directors of the Corporation adopted
the Univest 1993 Long-Term Incentive Plan and allocated 78,425 shares of common
stock of the Corporation, par value $5 per share, subsequently increased to
196,063 shares due to stock dividends in 1993 and 1996, to be reserved for
granting thereunder, of which 98,031 shares may be granted for incentive stock
options. The shareholders of the Corporation approved the 1993 Long-Term
Incentive Plan at the 1993 Annual Meeting of Shareholders on April 13, 1993.
On November 27, 1996, the Board of Directors adopted Amendment No. 1 to
the 1993 Long-Term Incentive Plan, which Amendment No. 1 increases the number of
shares of common stock of the Corporation, $5 par value per share, to be
reserved for granting thereunder to 250,000 shares, of which 125,000 may be
granted for awards of incentive stock options. The shareholders of the
Corporation approved Amendment No. 1 to the 1993 Long-Term Incentive Plan at the
1997 Annual Meeting of Shareholders on April 8, 1997, increasing the number of
options authorized to 250,000 shares. The number of shares authorized,
automatically increased to 525,000 shares due to a 100% stock dividend in 1998
and a 5% stock dividend in 2000.
On November 22, 2000, the Board of Directors adopted Amendment No. 2 to
the 1993 Long-Term Incentive Plan, which Amendment No. 2 increases the number of
shares of common stock of the Corporation, $5 par value per share, to be
reserved for granting thereunder by 275,000 shares to 800,000 shares which may
be granted for awards of incentive stock options, subject to the approval of the
shareholder. The increase will make 308,731 shares available as Incentive Stock
Options. The Board of Directors seeks the approval of the shareholders with
respect to the adoption of Amendment No. 2 of the 1993 Long-Term Incentive Plan.
The purposes of the 1993 long-term incentive plan are (i) to enable
eligible employees of the corporation to own shares of common stock of the
company, and have a mutuality of interest with other shareholders; and (ii) to
enable the corporation to attract, retain, and motivate key employees of
particular merit.
4
COMPENSATION AND ADDITIONAL INFORMATION
The following table sets forth, for the preceding three years, the
compensation which the Corporation and its subsidiaries paid to the five highest
paid executive officers whose compensation exceeded $100,000 during 2000.
SUMMARY COMPENSATION TABLE
ANNUAL
COMPENSATION
-------------------------------------- LONG-TERM
COMPENSATION
-------------
SECURITIES ALL OTHER
OTHER ANNUAL UNDERLYING COMPEN-
NAME AND PRINCIPAL POSITION YEAR SALARY BONUS COMPENSATION OPTIONS/SARS SATION
- ---------------------------------------------------------------------------------------------------------------------------
($) ($) ($)(1) (#) ($)(2)
- ---------------------------------------------------------------------------------------------------------------------------
William S. Aichele .......................... 2000 $250,000 $105,000 $12,827 13,500 $47,289
President and CEO of Univest 1999 220,000 51,975 3,500 25,000 27,839
Corporation and President 1998 190,000 41,800 3,500 -- 27,639
and CEO of Union National Bank
Marvin A. Anders ............................ 2000 $161,000 $ 42,263 $ 2,165 7,500 $16,830
Chairman of Univest Corporation 1999 146,000 30,660 1,550 10,000 16,426
and Chairman of Union National Bank 1998 135,000 29,700 775 -- 16,800
Norman L. Keller ............................ 2000 $145,000 $ 38,063 $ 3,986 3,000 $34,350
Executive Vice President of Univest 1999 142,500 29,925 2,592 4,250 34,275
Corporation and President and 1998 140,000 30,800 1,764 -- 34,200
CEO of Pennview Savings Bank
Wallace H. Bieler ........................... 2000 $140,000 $ 36,750 $ 1,500 5,000 $20,441
Executive Vice President and CFO of 1999 130,000 27,300 1,550 7,500 20,141
Univest Corp. and Exec. Vice President 1998 120,000 26,400 775 -- 19,841
and CFO of Union National Bank
K. Leon Moyer ............................... 2000 $130,000 $ 34,125 $1,200 5,000 $ 5,420
Executive Vice President of Univest 1999 120,000 22,050 -0- 7,500 23,465
Corp.and Executive Vice President of 1998 105,000 17,325 -0- -0- 23,150
Union National Bank
(1) Includes use of company car, personal tax preparation services, and country
club membership dues.
(2) The amount and type of All Other Compensation" are reported in Schedule 1
below.
SCHEDULE (1) -- ALL OTHER COMPENSATION 2000:
SUPPLEMENTAL
PENSION PLAN
NAMED EXECUTIVE 401(K) CONTRIBUTION (A) TOTAL
---------------------------------------------------------------------------------------
William S. Aichele $5,250 $42,039 $47,289
Marvin A. Anders $4,830 $12,000 $16,830
Norman L. Keller $4,350 $30,000 $34,350
Wallace H. Bieler $4,200 $16,241 $20,441
K. Leon Moyer $3,900 $ 1,520 $ 5,420
(A) Also includes additional social security medical contributions.
5
AGGREGATED OPTION/SAR EXERCISES IN LAST FISCAL YEAR AND
FISCAL YEAR-END OPTION/SAR VALUES
NUMBER OF
SECURITIES VALUE OF
UNDERLYING UNEXERCISED
UNEXERCISED IN-THE-MONEY
OPTIONS/SARS AT OPTIONS/SARS AT
FY-END (#) FY-END ($)
SHARES
ACQUIRED ON VALUE EXERCISABLE(E) EXERCISABLE(E)
NAME EXERCISE * REALIZED ** UNEXERCISABLE(U) UNEXERCISABLE(U)
- ---------------------------------------------------------------------------------------------------------------------------
William S. Aichele - 0 - - 0 - 13,125 (E) $98,281 (E)
39,750 (U) --
Marvin A. Anders - 0 - - 0 - 6,126 (E) 45,872 (E)
18,000 (U) --
Norman L. Keller - 0 - - 0 - 9,188 (E) 68,800 (E)
7,462 (U) --
Wallace H. Bieler 750 $7,875 6,825 (E) 51,106 (E)
12,875 (U) --
K. Leon Moyer - 0 - - 0 - 1,749 (E) 13,096 (E)
12,875 (U) --
* The Company has a stock-for-stock-option exchange (or cashless exercise)
program in place, whereby optionees can exchange the value of the spread of
in-the-money options for Company stock having an equivalent value. This
exchange allows the executives to exercise their options without having to
pay the exercise price in cash. However, it will result in the executives
acquiring less shares than the number of options exercised. One of the
named executives utilized this program in 2000.
** "Value Realized" is calculated by subtracting the exercise price from the
fair market value as of exercise date. Fair market value is calculated as
the mean of the highest and lowest selling prices of the stock on the New
York Stock Exchange.
6
UNIVEST CORP. OF
PENNSYLVANIA
BOARD COMPENSATION COMMITTEE
REPORT ON EXECUTIVE COMPENSATION
THE COMPENSATION COMMITTEE OF THE BOARD OF DIRECTORS (THE COMPENSATION
COMMITTEE") FOR THE FISCAL YEAR ENDED DECEMBER 31, 2000 WAS COMPRISED OF FIVE
MEMBERS APPOINTED BY THE BOARD OF DIRECTORS: JAMES L. BERGEY, R. LEE DELP,
CHARLES H. HOEFLICH, WHO FORMERLY SERVED AS CHAIRMAN OF UNIVEST CORPORATION,
THOMAS K. LEIDY, AND MERRILL S. MOYER, WHO FORMERLY SERVED AS CHAIRMAN OF
UNIVEST CORPORATION.
THE COMPENSATION COMMITTEE REVIEWS AND APPROVES THE ANNUAL COMPENSATION OF THE
CORPORATION'S EXECUTIVE OFFICERS AND OTHER KEY MANAGEMENT PERSONNEL. IN
ADDITION, THE COMPENSATION COMMITTEE ESTABLISHES POLICIES AND GUIDELINES FOR
OTHER BENEFITS AND ADMINISTERS COMPENSATION AND CERTAIN OTHER BENEFIT PLANS,
INCLUDING THE AWARD OF STOCK AND STOCK OPTIONS. THE COMPENSATION COMMITTEE IS
ASSISTED IN MAKING COMPENSATION DECISIONS BY THE CORPORATION'S MANAGEMENT AND
THE CORPORATION'S INDEPENDENT PROFESSIONAL COMPENSATION CONSULTANTS.
EXECUTIVE COMPENSATION POLICY
The principal objective of the Corporation is to maximize shareholder
value through the development and enhancement of the Corporation's business
operations. To further that objective, the Corporation's executive compensation
program is designed to:
o Attract and retain quality talent, which is critical to both the
short-term and long-term success of the Corporation.
o Reinforce strategic performance objectives through the use of
compensation programs.
o Create a mutuality of interest between executive officers and
shareholders through compensation structures that share the rewards and
risks of strategic decision making.
o Require executives to achieve substantial levels of ownership of
Corporation stock in order to better align the executives' interests
with those of the shareholders through a variety of plans.
o Compensation has been and will continue to be tax deductible.
An executive's total compensation is composed of three primary components:
base salary compensation, annual incentive compensation, and long-term incentive
compensation. Each component is based on individual and group performance
factors, which are measured objectively and subjectively by the Compensation
Committee.
BASE SALARY COMPENSATION
The Compensation Committee's approach is to offer competitive salaries in
comparison with market practices. The Compensation Committee annually examines
market compensation levels and trends observed in the labor market. For its
purposes, the Compensation Committee has defined the labor markets as the pool
of executives who are currently employed in similar positions in companies with
similar market capitalization, with special emphasis placed on salaries paid by
companies that constitute the banking industry. Market information is used as a
frame of reference for annual salary adjustments and starting salaries.
The Compensation Committee makes salary decisions in a structured annual
review. The Compensation Committee considers decision-making responsibilities,
experience, work performance, and team-building skills of each position as the
most important measurement factors in its annual reviews. To help quantify these
measures,
7
the Compensation Committee has, from time to time, enlisted the assistance of
independent compensation consultants.
IRC (S) 162(M)
Internal Revenue Code Section 162(m) imposes a limitation on the deduction
for certain executive officers' compensation unless certain requirements are
met. The Corporation and the Compensation Committee have carefully considered
the impact of these tax laws and have taken certain actions intended to preserve
the Corporation's tax deduction with respect to any affected compensation.
ANNUAL INCENTIVES
Univest established an annual incentive plan to reward executive officers
for accomplishing annual financial objectives. The weighted financial measures
(Return on Assets) and related targets for the plan are set forth the preceding
fiscal year by the Compensation Committee. For executive officers, other than
the CEO, consideration is given to the overall corporate performance and
performance of the specific areas of the Corporation under a participant's
direct control. This balance supports the accomplishment of overall objectives
and rewards individual contributions by the executive officers. Individual
annual bonus level targets are consistent with market practices for positions
with comparable decision-making responsibilities.
The average bonus earned under the Plan in 2000 by the four executive
officers at year-end other than the CEO (which appear in the summary
compensation table) was 26% of their base salaries. For the executive officers,
excluding the CEO, payments ranged from $34,000 to $ 42,000 and were indicative
of the strong performance demonstrated by the Corporation and the individuals.
With respect to performance, Return on Assets for 2000 was 1.51%, reflecting
continued strong financial performance.
LONG-TERM INCENTIVES
The Univest Long-Term Incentive Plan was implemented in 1993 in order to
promote the long-term objectives of Univest, retain key executives, encourage
growth in shareholder value, and encourage management investment in Univest.
Compensation derived from long-term awards was therefore tied directly to the
creation of shareholder value.
Participation in the Long-Term Incentive Plan is determined by the
Committee. The Committee may grant either stock options or long-term performance
share awards to executives and other employees. These will have value to the
recipients only if shareholder value is created, either in the form of stock
price appreciation and/or the increased ability of Univest to pay dividends in
its stock. The Committee continues to believe that shareholders benefit from a
greater emphasis on encouraging management to own Company Stock. In order to
strengthen the mutuality of interests between shareholders and management, the
Committee has granted new options to employees who can have a positive impact on
Univest's performance in the near future.
Univest provides non-qualified pension plans for certain executive
officers, including the individuals named in the Summary Compensation Table.
During 2000, Univest purchased bank-owned life insurance arrangements to fund
future obligations under these non-qualified pension plans.
The non-qualified pension plans provide an additional retirement benefit
paid to the employee beginning at age 65 for a term between 10 and 15 years,
plus death benefits.
8
FUTURE AWARD DETERMINATION
The Committee will continue to reassess Univest's executive compensation
program in order to ensure that it promotes the long-term objectives of Univest,
encourages growth in shareholder value, provides the opportunity for management
investment in the Corporation, and attracts and retains top-level executives who
will manage strategically in 2001 and beyond.
CEO COMPENSATION
The salary paid to William S. Aichele in 2000 was increased to $250,000
compared with $220,000 in 1999. This increase in base salary was provided to
better align Mr. Aichele with the CEOs of the peer group. Mr. Aichele's bonus
award for 2000 was $105,000. This award represented 42% of his base salary and
was determined based on Univest's achievement of annual performance measures
including return on assets performance and individual performance.
CONCLUSION
Through the programs described above, a significant portion of the
Corporation's executive compensation is linked directly to individual and
corporate performance and growth in shareholder value. The Committee intends to
continue the policy of linking executive compensation to individual and
corporate performance and growth in shareholder value, recognizing that the
business cycle from time to time may result in an imbalance for a particular
period.
UNIVEST CORPORATION COMPENSATION COMMITTEE
James L. Bergey
R. Lee Delp
Charles H. Hoeflich
Thomas K. Leidy
Merrill S. Moyer
9
NON-MANAGEMENT DIRECTOR COMPENSATION:
Each non-employee Director or Alternate Director is paid an annual
retainer fee of $8,500. Each non-employee Director or Alternate Director
receives a fee of $700 for each Board of Directors meeting of Univest, Union, or
Pennview which he attends. Only one fee is paid to the Director or Alternate
Director if these Boards meet on a concurrent basis. Non-employee Directors who
are members of the Executive Committee or Loan Policy Committee of the Board of
Directors receive a fee of $600 for each meeting attended. Non-employee
Directors or Alternate Directors who attend other committees of the Board of
Directors receive a fee ranging from $400 to $500 for each meeting attended.
RETIREMENT, SALARY CONTINUATION, AND DEFERRED SALARY SAVINGS PLANS:
All officers and employees of the Corporation and its subsidiaries working
1,000 hours or more in a plan year will accrue a benefit in that year and will
be included in a nondiscriminatory retirement plan which qualifies under the
Internal Revenue Code. The plan is compulsory and non-contributory. Benefits
vest when an officer or employee completes five years of service. In addition,
the Corporation maintains a non-qualified, unfunded plan, the Supplemental
Retirement Plan (the Supplemental Retirement Plan"), which provides retirement
benefits to eligible employees. The table set forth below illustrates the total
combined estimated annual benefits payable under the Univest Retirement Plan and
the Supplemental Retirement Plan to eligible salaried employees in hypothetical
five (5) year average salary and years of service classification (assuming
retirement as of January 1, 2001) are estimated as follows:
YEARS OF SERVICE
HIGHEST -----------------------------------------------------------------------------------------------------
CONSECUTIVE 20 25 30 35 40 45 50
5-YEAR AVG. -----------------------------------------------------------------------------------------------------
SALARY
$150,000 $ 48,870 $ 53,588 $ 58,305 $ 63,023 $ 66,773 $ 70,523 $ 74,273
200,000 66,370 72,963 79,555 86,148 91,148 96,148 101,148
250,000 83,870 92,338 100,805 109,273 115,523 121,773 128,023
300,000 101,370 111,713 122,055 132,398 139,898 147,398 154,898
350,000 118,870 131,088 143,305 155,523 164,273 173,023 181,773
Assuming Retirement as of January 1, 2001
- - Benefit limit under IRC section 415: not reflected
- - Maximum recognizable compensation: not reflected
The annual benefits are estimated on the basis of a straight life annuity
notwithstanding the availability of joint and survivor annuitant and certain and
continuous annuity options. Benefits are not subject to reduction for Social
Security benefits. For purposes of the plan (assuming retirement at normal
retirement date), William S. Aichele, Norman L. Keller, Marvin A. Anders,
Wallace H. Bieler, and K. Leon Moyer respectively, have forty-four, forty-one,
forty-seven, forty-five, and forty-four years of service. Certain groups of
officers and employees have other benefits for past service with now affiliated
companies.
A salary continuation plan is provided for the individuals named in the
Summary Compensation Table and to certain other executive management of the
Corporation. The plan was established to provide pre- and post-retire-
10
ment death benefits. Additionally, retirement benefits are payable upon the
death, disability, or retirement of the individual covered by the plan and are
calculated as a percentage of base salary of the individual adjusted for the
cost of living. The retirement benefits payable to the individual or the spouse
of the individual are for a minimum of ten (10) years and are determined in
amount as of the retirement date. The salary continuation plan is an unfunded
promise to pay to the named individuals which is subject to the substantial risk
of forfeiture, and the individual is not considered as vested pursuant to the
plan.
On an optional basis, all officers and employees who have attained the age
of 21 and have completed 12 months of service may participate in a deferred
salary savings plan. Participants may defer from 1% to 15% of their salary. The
corporation or its subsidiaries will make a matching contribution of 50% of the
first 6% of the participant's salary. All contributions are invested via a
trust. The corporation's matching contributions, amounting to $306,403 are
vested at 50% at the end of two years, 75% at the end of three years, and 100%
at the end of four years. Benefit payments normally are made in connection with
a participant's retirement. The plan permits early withdrawal of the money under
certain circumstances. Under current Internal Revenue Service regulations, the
amount contributed to the plan and the earnings on those contributions are not
subject to Federal income tax until they are withdrawn from the plan.
Compensation for Group Life Insurance premiums, hospitalization and
medical plans, and other personal benefits are provided to all full-time
employees and part-time employees averaging a certain number of hours and do not
discriminate in favor of officers or directors of the Corporation or its
subsidiaries.
TRANSACTIONS WITH MANAGEMENT AND OTHERS
Union and Pennview had transactions with directors/officers of UNIVEST or
their associates, which comply with regulations of the Comptroller of the
Currency and the Federal Reserve System, involving only normal risks which were
made in the ordinary course of business on substantially the same terms,
including interest rates and collateral, as those prevailing at the time for
comparable transactions with other persons and did not involve more than normal
risk of collectability or present other unfavorable features.
During 2000, the Corporation and its subsidiaries paid $707,942 to H.
Mininger & Son, Inc. for building expansion projects which were in the normal
course of business on substantially the same terms as available from others. H.
Ray Mininger, Director, is president of H. Mininger & Son, Inc. Abram W. Bergey
& Sons, Inc. was paid $105,772 for carpet and flooring work at various office
locations on substantially the same terms as available from others. James L.
Bergey, Director, is President of Abram W. Bergey & Sons, Inc.
REPORT OF THE AUDIT COMMITTEE
The Audit Committee (Committee")oversees the Corporation's financial
reporting process on behalf of the Board of Directors. Management has the
primary responsibility for the financial statements and the reporting process
including the systems of internal controls. In fulfilling its oversight
responsibilities, the Committee reviewed the audited financial statements in the
Annual Report with management including a discussion of the quality, not just
the acceptability, of the accounting principles, the reasonableness of
significant judgments, and the clarity of disclosures in the financial
statements.
The Committee reviewed with the independent auditors, who are responsible
for expressing an opinion on the conformity of those audited financial
statements with generally accepted accounting principles, their judgments as to
the quality, not just the acceptability, of the Corporation's accounting
principles and such other matters as are required to be discussed with the
Committee under generally accepted auditing standards. In addition, the
11
Committee has discussed with the independent auditors the auditors' independence
from management and the Corporation including the matters in the written
disclosures required by the Independent Standards Board and considered the
compatibility of nonaudit services with the auditors' independence.
The Committee discussed with the Corporation internal and independent
auditors the overall scope and plans for their respective audits. The Committee
meets with the internal and independent auditors, with and without management
present, to discuss the results of their examinations, their evaluations of the
Corporation's internal controls, and the overall quality of the Corporation's
financial reporting. The Committee held four meetings during the fiscal year
2000 which were attended by all members.
In reliance on the reviews and discussions referred to above, the
Committee recommended to the Board of Directors (and the Board has approved)
that the audited financial statements be included in the Annual Report on Form
10-K for the year ended December 31, 2000, for filing with the Securities and
Exchange Commission. The Committee and the Board have also recommended, subject
to shareholder approval, the selection of the Corporation's independent
auditors.
All members of the Audit Committee are independent in the fact that they
are not employees of Univest Corporation and have no other direct business
relationship to the Corporation other than as outside directors within the prior
three-years, except Merrill S. Moyer, who retired June 30, 1999, and will not be
classified as independent until June 30, 2002. Although the Corporation is not
subject to the rules and regulations of the New York Stock Exchange (NYSE"),
NYSE regulations, which were used in determining independence of officers,
provide that prior officers of a corporation will be deemed independent three
years after they cease to be officers, and the Corporation has elected to adopt
this standard of independence. At the regular Board of Directors meeting
September 27, 2000, it was unanimously resolved to have Merrill S. Moyer
continue to serve as chairman of the Audit Committee, due to his long-term
active role and knowledge of the functioning of the Corporation. This exception
is provided for within the NYSE regulations.
A copy of the Audit Committee Charter is attached as Exhibit A.
UNIVEST AUDIT COMMITTEE
Merrill S. Moyer, Chairman
William G. Morral
P. Gregory Shelly
John U. Young
RATIFICATION OF APPOINTMENT OF INDEPENDENT AUDITORS
Subject to ratification by the shareholders, the Board of Directors has
reappointed Ernst & Young LLP as independent auditors to audit the financial
statements of the Corporation for the current fiscal year. Fees for the last
annual audit were $154,000 and all other fees were $354,490, including audit
related services of $277,000 and non-audit services of $77,490. Audit related
services include fees for the Retirement Plan and Deferred Salary Savings Plan
audits, internal audit, and regulatory audits.
Representatives of the firm of Ernst & Young LLP are expected to be
present at the Annual Meeting and will have an opportunity to make a statement
if they so desire and will be available to respond to appropriate questions.
The audit committee and the board of directors recommend the shareholders
vote "FOR" such ratification.
12
EXHIBIT A:
AUDIT COMMITTEE CHARTER
ORGANIZATION
This charter governs the operations of the audit committee. The committee
shall review and reassess the charter at least annually and obtain the approval
of the board of directors. The committee shall be appointed by the board of
directors and shall comprise at least three directors, each of whom shall be
independent of management and the corporation, unless otherwise determined by
the Board of Directors. Members of the committee shall be considered independent
if they have no relationship that may interfere with the exercise of their
independence from management and the corporation. All committee members shall be
financially literate, and at least one member shall have accounting or related
financial management expertise.
STATEMENT OF POLICY
The audit committee shall provide assistance to the board of directors in
fulfilling their oversight responsibility to the shareholders, potential
shareholders, the investment community, and others relating to the corporation's
financial statements and the financial reporting process, the systems of
internal accounting and financial controls, the internal audit function, the
annual independent audit of the corporation's financial statements, and the
legal compliance and ethics programs as established by management and the board.
In so doing, it is the responsibility of the committee to maintain free and open
communication between the committee, independent auditors, the internal auditors
and management of the corporation. In discharging its oversight role, the
committee is empowered to investigate any matter brought to its attention with
full access to all books, records, facilities, and personnel of the corporation
and the power to retain outside counsel, or other experts for this purpose.
RESPONSIBILITIES AND PROCESSES
The primary responsibility of the audit committee is to oversee the
corporation's financial reporting process on behalf of the board and report the
results of their activities to the board. Management is responsible for
preparing the corporation's financial statements, and the independent auditors
are responsible for auditing those financial statements. The committee in
carrying out its responsibilities believes its policies and procedures should
remain flexible, in order to best react to changing conditions and
circumstances. The committee should take the appropriate actions to set the
overall corporate tone" for quality financial reporting, sound business risk
practices, and ethical behavior.
The following shall be the principal recurring processes of the audit
committee in carrying out its oversight responsibilities. The processes are set
forth as a guide with the understanding that the committee may supplement them
as appropriate.
o The committee shall have a clear understanding with management and the
independent auditors that the independent auditors are ultimately
accountable to the board and the audit committee, as representatives of
the corporation's shareholders. The committee shall have the ultimate
authority and responsibility to evaluate and, where appropriate, replace
the independent auditors. The committee shall discuss with the auditors
their independence from management and the corporation and the matters
included in the written disclosures required by the Independence
Standards Board, and shall consider the compatibility
13
of non-audit services with the auditors' independence. Annually, the
committee shall review and recommend to the board the selection of the
corporation's independent auditors, subject to shareholders' approval.
o The committee shall discuss with the internal auditors and the
independent auditors the overall scope and plans for their respective
audits including the adequacy of staffing and compensation. Also, the
committee shall discuss with management, the internal auditors, and the
independent auditors the adequacy and effectiveness of the accounting
and financial controls, including the corporation's system to monitor
and manage business risk, and legal and ethical compliance programs.
Further, the committee shall meet separately with the internal auditors
and the independent auditors, with and without management present, to
discuss the results of their examinations.
o The committee shall review the interim financial statements with
management and the independentauditors prior to filing the corporation's
Quarterly Report on Form 10-Q. Also, the committee shall discuss the
results of the quarterly review and any other matters required to be
communicated to the committee by the independent auditors under
generally accepted auditing standards. The chair of the committee may
represent the entire committee for the purpose of this review.
o The committee shall review with management and the independent auditors
the financial statements to be included in the corporation's annual
report on form 10-k, including their judgement about the quality, not
just the acceptability, of accounting principles, the reasonableness of
significant judgements, and the clarity of the disclosures in the
financial statements. Also, the committee shall discuss the results of
the annual audit and any other matters required to be communicated to
the committee by the independent auditors under generally accepted
auditing standards.
14
COMPARISON OF FIVE-YEAR CUMULATIVE TOTAL RETURN*
AMONG UNIVEST CORPORATION, THE NASDAQ STOCK MARKET (U.S.) INDEX
AND THE NASDAQ BANKS INDEX
[chart of COMPARISON OF FIVE-YEAR CUMULATIVE TOTAL RETURN*]
CUMULATIVE TOTAL RETURN
----------------------------------------------------------
12/95 12/96 12/97 12/98 12/99 12/00
UNIVEST CORPORATION 100.00 114.41 198.02 222.79 172.36 164.42
NASDAQ STOCK MARKET (U.S.) 100.00 123.04 150.69 212.51 394.92 237.62
NASDAQ BANK 100.00 132.04 221.06 219.64 211.14 241.08
* $100 INVESTED ON 12/31/95 IN STOCK OR INDEX--
INCLUDING REINVESTMENT OF DIVIDENDS.
FISCAL YEAR ENDING DECEMBER 31.
The stock price performance graph shall not be deemed incorporated by
reference by any general statement incorporating by reference this proxy
statement into any filing under the securities act of 1933 or the Securities
Exchange Act of 1934, except to the extent that univest specifically
incorporates this information by reference, and shall not otherwise be deemed
filed under such Acts.
15
DIRECTORS' MEETINGS AND COMMITTEES
UNIVEST's Board of Directors met twelve times during 2000. All members of
Univest's Board serve as a nominating committee. It proposes names for
nomination for election or re-election to the Board.
SHAREHOLDER PROPOSALS
Proposals by shareholders which are intended to be presented at the
Corporation's 2002 Annual Meeting must be received by the Corporation no later
than November 15, 2001, to be eligible for inclusion in the Proxy Statement and
proxy relating to that meeting.
According to bylaws of the Corporation, a proposal for action to be
presented by any shareholder at an annual or special meeting of shareholders
shall be out of order unless specifically described in the Corporation's notice
to all shareholders of the meeting and the matters to be acted upon thereat or
unless the proposal shall have been submitted in writing to the Chairman and
received at the principal executive offices of the Corporation at least 60 days
prior to the date of such meeting, and such proposal is, under law, an
appropriate subject for shareholder action.
OTHER BUSINESS:
The Board of Directors and Management do not intend to present to the
meeting any business other than as stated above. They know of no other business
which may be presented to the meeting. If any matter other than those included
in this proxy statement is presented to the meeting, the persons named in the
accompanying proxy will have discretionary authority to vote all proxies in
accordance with their best judgment.
SHAREHOLDERS ARE URGED TO SIGN THE ENCLOSED PROXY, SOLICITED ON BEHALF OF
THE BOARD OF DIRECTORS AND RETURN IT AT ONCE IN THE ENCLOSED ENVELOPE. PROXIES
WILL BE VOTED IN ACCORDANCE WITH SHAREHOLDERS' DIRECTIONS. THE PROXY DOES NOT
AFFECT THE RIGHT TO VOTE IN PERSON AT THE MEETING AND MAY BE REVOKED PRIOR TO
THE CALL FOR A VOTE.
By Order of the Board of Directors
Souderton, Pennsylvania
MARVIN A. ANDERS
March 8, 2001 CHAIRMAN
NORMAN L. KELLER
SECRETARY
16
[LOGO] UNIVEST
-------
CORPORATION OF PENNSYLVANIA
PROXY
14 North Main Street, Souderton, Pennsylvania 18964 and Voting Instruction Card
UNIVEST'S DIRECTORS RECOMMEND A VOTE "FOR" ITEMS 1, 2, 3 and 4.
FOR WITHHELD
1. Election of Four Class II Directors James L. Bergey, Charles H.
Hoeflich, Clair W. Clemens, John U. Young / / / /
FOR, EXCEPT VOTE WITHHELD FOLLOWING NOMINEE(S):
- ----------------------------------------------------------------------------------------------
FOR WITHHELD
2. Election of Two Alternate Directors Richard W. Godshall and Margaret K. / / / /
Zook
FOR, EXCEPT VOTE WITHHELD FOLLOWING NOMINEE(S):
- ----------------------------------------------------------------------------------------------
FOR AGAINST
3. Approval of an Amendment No. 2 to the Long-Term Incentive Plan / / / /
FOR AGAINST
4. Election of Ernst & Young LLP as Independent Certified Public Accountant
for 2001 / / / /
Signature(s):_____________________ _____________________ Date _____________
NOTE: Please sign as name(s) appear hereon. Give full title if signing for a
corporation, partnership, or as attorney, agent, or in another representative
capacity.
FOLD AND DETACH HERE
[LOGO]UNIVEST
-------
14 North Main Street, Souderton, Pennsylvania, 18964
PROXY
ANNUAL MEETING OF SHAREHOLDERS - APRIL 10, 2001
The annual Meeting of Shareholders of Univest Corporation of Pennsylvania will
be held on Tuesday, April 10, 2001, at the Univest Building, 14 North Main
Street, Souderton, Pennsylvania, at 10:45 a.m.
The top (shaded) portion of this form is your PROXY AND VOTING INSTRUCTION CARD.
Please COMPLETE, SIGN, and DATE the CARD, and then DETACH, and RETURN the
completed card PROMPTLY in the enclosed reply envelope. You should do so even if
you plan to attend the Annual Meeting. If you do attend, you may override your
proxy and vote in person if you wish.
PLEASE COMPLETE, SIGN, AND DATE YOUR PROXY AND VOTING INSTRUCTION CARD, DETACH
IT, AND RETURN IT PROMPTLY IN THE ENCLOSED REPLY ENVELOPE.
The signature(s) should be exactly as the name(s) appear above. When shares are
held by joint tenants, both should sign. When signing as attorney, executor,
administrator, trustee or guardian, please give full title as such. If a
corporation, please sign in full corporate name by President or other authorized
officer. If a partnership, please sign in partnership name by authorized person.
THIS PROXY IS SOLICITED BY THE BOARD OF DIRECTORS
OF UNIVEST CORPORATION OF PENNSYLVANIA
FOR THE ANNUAL MEETING OF SHAREHOLDERS ON APRIL 10, 2001.
The undersigned, having received the Notice of Annual Meeting of Shareholders
and Proxy Statement, each dated March 8, 2001, hereby appoints Harold F.
Detweiler and Gerald G. Dunlap, or any of them, with full power of substitution
to each, proxies to represent the undersigned and to vote all of the shares of
the Common Stock of Univest Corporation of Pennsylvania, (the Corporation") that
the undersigned would be entitled to vote if personally present at the 2001
Annual Meeting of Shareholders of the Corporation, or any adjournment thereof,
as directed on the reverse side and in their discretion on such other matters as
may properly come before the meeting or any adjournment thereof.
The shares represented by this proxy will be voted as directed on the reverse
side hereof. If no direction is given, however, the shares represented by this
proxy will be voted FOR the election of the nominees for Director (those
nominees are James L. Bergey, Charles H. Hoeflich, Clair W. Clemens, and John U.
Young), FOR the election of the nominees for Alternate Director (those nominees
are Richard W. Godshall, and Margaret K. Zook), FOR the approval of Amendment
No. 2 to the Long-Term Incentive Plan, and FOR the selection of Ernst & Young
LLP as the Corporation's Independent Certified Public Accountant for 2001.
Please complete, sign, and date this Card on the reverse side and return it
promptly in the enclosed reply envelope.
FOLD AND DETACH HERE