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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

SCHEDULE 14A

Proxy Statement Pursuant to Section 14(a) of the

Securities Exchange Act of 1934

Filed by the Registrant x                            Filed by a Party other than the Registrant ¨

Check the appropriate box:

Union Bankshares Corporation

(Name of Registrant as Specified In Its Charter)

(Name of Person(s) Filing Proxy Statement, if other than the Registrant)

Payment of Filing Fee (Check the appropriate box):

First Market Bank, FSB Class A common stock, par value $0.01 per share, Class B common stock, par value $0.01 per share, and Series A preferred stock, par value $100,000 per share.

578.262 shares of Class A common stock, 490 shares of Class B common stock and 100 shares of Series A preferred stock of First Market Bank, FSB.

$90,954,027, calculated pursuant to Rule 0-11(c)(1)(i) and Rule 0-11(a)(4) of the Securities Exchange Act of 1934, as amended, which represents the book value of the securities of First Market Bank, FSB.

$90,954,027, calculated pursuant to Rule 0-11(c)(1)(i) and Rule 0-11(a)(4) of the Securities Exchange Act of 1934, as amended.

$5,076.

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Preliminary Proxy Statement, Subject to Completion, dated June 30, 2009

[UBSH Logo]

PROPOSED MERGER – YOUR VOTE IS VERY IMPORTANT

Dear Fellow Shareholders:

We are pleased to report that the board of directors of Union Bankshares Corporation has unanimously approved a strategic merger with First Market Bank that will create the largest independent community banking organization headquartered in Virginia. We are sending you this document to ask you, as a UBSH shareholder, to vote in favor of certain merger related matters.

The combined company, which will change its name to [“Union First Market Bankshares Corporation”], will have assets of over $4 billion, a strong capital base and 97 branches with a strong presence in high growth markets. We believe the combined company will be well positioned to achieve strong financial performance and increase shareholder value through a balanced business mix, greater scale and enhanced efficiencies and competitiveness. In the proposed merger, First Market will merge with and into a newly-formed interim bank subsidiary of UBSH, and the continuing bank will operate under the name First Market Bank until such time as Union Bank and Trust Company, a wholly-owned subsidiary of UBSH, merges into the continuing bank and the combined bank operates under the new name,                                         .

Upon completion of the proposed merger, we estimate that the current UBSH shareholders will own approximately 65% of the combined company and the First Market shareholders will own approximately 35% of the combined company. In the merger, the First Market shareholders will receive 6,273.259 shares of UBSH common stock for each share of First Market common stock. In addition, each share of First Market’s Series A 9% Non-Cumulative Preferred Stock will be converted into the number of shares of UBSH common stock that is equal to the quotient determined by dividing $100,000 (the stock’s liquidation preference) by the 10-day average trading price of UBSH common stock as of the fifth business day before the closing, provided that the average trading price will not be more than $16.89 or less than $12.89. UBSH shareholders will continue to own their existing shares, which will not be affected by the merger.

Your vote is important. We are holding a special meeting of our shareholders to obtain approval of the issuance of up to approximately 7.5 million shares of our common stock in the merger and the change in our corporate name to [Union First Market Bankshares Corporation]. We urge you to read carefully this entire proxy statement, which includes important information about the merger. You should also carefully consider the information in the “Risk Factors” section beginning on page [        ].

Whether or not you plan to attend the special meeting, it is important that your shares be represented at the meeting and your vote recorded. Please take the time to vote by completing and mailing the enclosed proxy card. Even if you return the proxy, you may attend the special meeting and vote your shares in person.

The UBSH board of directors unanimously recommends that you vote FOR the proposals to issue shares to First Market shareholders in the merger and to change the corporate name.

Thank you for your support.

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Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved of the securities to be issued in connection with the merger or determined if this proxy statement is accurate or complete. Any representation to the contrary is a criminal offense.

The securities to be issued in the merger are not savings or deposit accounts and are not insured by the Federal Deposit Insurance Corporation or any other governmental agency.

This proxy statement is dated                     , 2009 and is first being mailed to shareholders on or about                     , 2009.

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UNION BANKSHARES CORPORATION

NOTICE OF SPECIAL MEETING OF SHAREHOLDERS

To be held on                     , 2009

A special meeting of shareholders of Union Bankshares Corporation (“UBSH”) will be held at the UBSH Operations Center, which is located at 24010 Partnership Boulevard, Ruther Glen, Virginia, at         :              .m. local time, on                     , 2009 for the following purposes:

All shareholders of record of UBSH common stock at the close of business on                     , 2009, are entitled to notice of and to vote at the meeting and any adjournments thereof.

                    , 2009

The UBSH board of directors unanimously recommends that shareholders vote “FOR” approval of the issuance of common stock to FMB shareholders in the merger, “FOR” approval of the amendment to the articles of incorporation and “FOR” approval to adjourn or postpone the special meeting, if necessary.

Please promptly complete and return the enclosed proxy, whether or not you plan to attend the special meeting. If you attend the meeting in person, you may withdraw your proxy and vote your own shares.

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ADDITIONAL INFORMATION

This proxy statement incorporates by reference important business and financial information about UBSH from other documents that are not included in or delivered with this proxy statement. For a listing of the documents incorporated by reference, see “Where You Can Find More Information” on page       . This information is available to you without charge upon your written or oral request. You can obtain the documents incorporated by reference into this proxy statement through the Securities and Exchange Commission’s website at http://www.sec.gov, through UBSH’s website at http://www.ubsh.com or by requesting them in writing or by telephone at the address below:

To receive timely delivery of the documents in advance of the special meeting, please make your request no later than                     , 2009.

In this proxy statement, Union Bankshares Corporation is referred to as “UBSH,” the newly-formed interim bank subsidiary of UBSH is referred to as the “interim bank,” Union Bank and Trust Company is referred to as “UBTC” and First Market Bank, FSB is referred to as “FMB.” The merger of FMB with and into the interim bank is referred to as the “merger,” and the First Amended and Restated Agreement and Plan of Reorganization, entered into on June 19, 2009 and dated and made effective as of March 30, 2009, between Union Bankshares Corporation and First Market Bank, FSB, including the related Plan of Merger between FMB and the interim bank, is referred to collectively as the “merger agreement.” We refer to UBSH after the merger as the “combined company,” the bank resulting from the merger of FMB and the interim bank as the “continuing bank” and the bank resulting from the merger of the continuing bank and UBTC as the “combined bank.”

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QUESTIONS AND ANSWERS

The following questions and answers briefly address some commonly asked questions about the UBSH special meeting and the merger. They may not include all the information that is important to UBSH shareholders. We urge shareholders to read carefully this entire proxy statement, including the annexes and the other documents referred to herein.

We are holding a special meeting of shareholders to vote on the proposals necessary to complete the merger. Information about this meeting, the merger and the other business to be considered by shareholders is contained in this proxy statement.

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Current UBSH president and chief executive officer, G. William Beale, will serve as chief executive officer of the combined company. Mr. Fairchild will serve as president of the combined company. Current UBSH executive vice president and chief banking officer John C. Neal will serve as executive vice president and chief banking officer for the combined company, and current UBSH executive vice president and chief financial officer D. Anthony Peay will serve as executive vice president and chief financial officer for the combined company.

Mr. Beale will serve as chief executive officer of the combined bank. Mr. Neal will serve as president and Mr. Fairchild will serve as executive vice president and chief banking officer for the combined bank.

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You may also cast your vote in person at the special meeting. If your shares are held in “street name,” through a broker, bank or other nominee, that institution will send you separate instructions describing the procedure for voting your shares. “Street name” shareholders who wish to vote in person at the meeting will need to present a proxy from the institution that holds their shares.

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The proposal to amend the articles of incorporation of UBSH to change the name of the company to [“Union First Market Bankshares Corporation”] requires the affirmative vote of a majority of all votes entitled to be cast.

Approval of a motion to adjourn or postpone the special meeting to permit further solicitation of proxies to approve the matters considered at the special meeting requires the affirmative vote of at least a majority of the shares represented at the special meeting, whether or not a quorum is present.

With respect to the proposal to amend the UBSH articles of incorporation to change the name of the company, if you fail to vote or fail to instruct your broker or other nominee how to vote, your failure to vote will have the same effect as a vote against approval of the amendment. If you are a shareholder and you respond with an “abstain” vote, your proxy will have the same effect as a vote against approval of the amendment. If you do not hold your shares in street name and respond but do not indicate how you want to vote on the amendment, your proxy will be counted as a vote in favor of such proposal.

If you choose either of the first two methods, you must take the described action no later than the beginning of the special meeting.

If your shares are held in an account at a broker or other nominee, you should contact your broker or other nominee to change your vote.

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If your shares are held in a stock brokerage account or by a bank or other nominee, you should call your broker or other nominee for additional information.

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SUMMARY

This summary highlights selected information from this proxy statement. It does not contain all of the information that is important to you. We urge you to read carefully the entire proxy statement and the other documents to which this proxy statement refers to understand fully the merger and the other matters to be considered at the special meeting. See “Where You Can Find More Information” beginning on page __. Each item in this summary includes a page reference directing you to a more complete description of that item.

The Parties (page       )

Union Bankshares Corporation

211 North Main Street

P.O. Box 446

Bowling Green, Virginia 22427-0446

(804) 633-5031

Union Bankshares Corporation is a multibank holding company headquartered in Caroline County, Virginia providing financial services through its three community banks, Union Bank and Trust Company, Northern Neck State Bank and Rappahannock National Bank, and its three nonbank financial services affiliates, Union Investment Services, Inc., a full service discount brokerage company, Union Mortgage Group, Inc., a full service mortgage lender and Union Insurance Group, LLC, a full service provider of insurance products and financial planning. UBSH’s current market area stretches from Rappahannock County to Fredericksburg and north to Fairfax, south to Richmond, east to Williamsburg, west to Charlottesville and throughout the Northern Neck area of Virginia.

The common stock of UBSH is traded on the NASDAQ Global Select Market under the symbol “UBSH.”

As of March 31, 2009, UBSH had total consolidated assets of approximately $2.6 billion, total net consolidated loans of approximately $1.9 billion, total consolidated deposits through its banking subsidiaries of approximately $2.0 billion and consolidated shareholders’ equity of approximately $275.0 million.

First Market Bank, FSB

111 Virginia Street, Suite 200

Richmond, Virginia 23219

(804) 327-7500

First Market Bank, FSB is a privately held, federally chartered savings bank, headquartered in Richmond, Virginia, which operates 39 branches throughout central Virginia. FMB offers a range of commercial and retail banking products and services, as well as trust and investment services.

As of March 31, 2009, FMB had total consolidated assets of approximately $1.4 billion, total net loans of approximately $1.0 billion, total deposits of approximately $1.2 billion and shareholders’ equity of approximately $124.9 million.

The Merger (page       )

We are proposing a combination with FMB through a merger of FMB with and into a newly-formed interim bank subsidiary of UBSH. After the merger, the combined company will operate under

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the new name of [“Union First Market Bankshares Corporation”], and the continuing bank from the merger will operate as a Virginia chartered bank subsidiary of UBSH under the name “First Market Bank” until such time as UBTC merges into the continuing bank and the combined bank operates under the new name,                                         . We refer to the company resulting from the merger as the “combined company,” the bank resulting from the merger of FMB and the interim bank as the “continuing bank” and the bank resulting from the merger of the continuing bank and UBTC as the “combined bank.” The parties expect to complete the merger by the end of 2009. The merger agreement is attached to this proxy statement as Annex A. We encourage you to read the merger agreement because it is the legal document that governs the merger.

Consideration to be Received in the Merger by FMB Shareholders (page       )

In the proposed merger, FMB shareholders will receive 6,273.259 shares of the common stock of the combined company for each of their whole shares of FMB common stock outstanding on the effective date of the merger and cash in lieu of any fractional shares. In addition, each share of FMB’s Series A preferred stock will be converted into the number of shares of common stock of the combined company that is equal to the quotient determined by dividing $100,000 (the stock’s liquidation preference) by the 10-day average trading price of UBSH common stock as of the fifth business day before closing, provided that average trading price will not be more than $16.89 or less than $12.89.

UBSH shareholders will continue to own their existing shares of UBSH common stock, with each share of UBSH common stock representing one share of common stock in the combined company following the merger.

Ownership of the Combined Company After the Merger (page       )

Upon completion of the merger, current UBSH shareholders will own approximately 65% of the combined company’s outstanding common stock, on a fully diluted basis, and the holders of FMB common stock and Series A preferred stock will own approximately 35% of the combined company’s outstanding common stock, on a fully diluted basis.

Directors and Executive Officers Following the Merger (page       )

The Combined Company. The combined company will be governed by a board of directors comprised of thirteen directors, of which ten will be the current UBSH directors, one will be the current FMB president and chief executive officer, David J. Fairchild, and the remaining two will be James E. Ukrop, the current chairman of the board of FMB, and Steven A. Markel, a current director of FMB.

Current UBSH president and chief executive officer, G. William Beale, will serve as chief executive officer of the combined company. Mr. Fairchild will serve as president of the combined company. Current UBSH executive vice president and chief banking officer, John C. Neal, will serve as executive vice president and chief banking officer for the combined company, and current UBSH executive vice president and chief financial officer D. Anthony Peay will serve as executive vice president and chief financial officer for the combined company.

The Combined Bank. The combined bank will be governed by a board of directors comprised of fifteen directors, of which twelve will be current directors of UBTC or UBSH, one will be the current FMB president and chief executive officer, Mr. Fairchild, and the remaining two will be current directors of FMB.

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Mr. Beale will serve as chief executive officer of the combined bank. Mr. Neal will serve as president and Mr. Fairchild will serve as executive vice president and chief banking officer for the combined bank.

Recommendation of the UBSH Board of Directors (page       )

The UBSH board of directors unanimously recommends that UBSH shareholders vote FOR the proposal to issue shares of common stock to FMB shareholders in the merger, FOR the proposal to change the name of UBSH to [“Union First Market Bankshares Corporation”], and FOR the proposal to adjourn or postpone the meeting to a later date or dates, if necessary.

Opinions of UBSH’s Financial Advisors (page       )

UBSH engaged the firm of Keefe, Bruyette & Woods, Inc. (“KBW”) to review the proposed merger and provide a fairness opinion. KBW has given its opinion to the UBSH board that, as of March 30, 2009, the exchange ratio provided for in the merger agreement was fair from a financial point of view to UBSH shareholders. A copy of the fairness opinion, setting forth the information reviewed, assumptions made, and matters considered by KBW, is attached to this proxy statement as Annex B. We encourage you to read carefully the entire opinion of KBW. The opinion of KBW has not been updated prior to the date of this proxy statement and does not reflect any change in circumstances after March 30, 2009.

KBW’s opinion as to the fairness, from a financial point of view, of the exchange ratio to UBSH was provided to the UBSH board of directors in connection with its evaluation of the exchange ratio from a financial point of view, does not address any other aspect of the merger and does not constitute a recommendation to any shareholder as to how to vote or act with respect to the merger.

Interests of Certain Persons in the Merger (page       )

Certain members of UBSH’s management, as well as certain members of the UBSH board of directors, have interests in the merger in addition to their interests as shareholders of UBSH. These interests include new positions with or appointment to the board of directors of the combined company or the combined bank. The UBSH board was aware of these potential interests and considered them, among other matters, in approving the merger agreement and the transactions contemplated thereby. See “The Merger – Interests of Directors and Executive Officers in the Merger.”

Material U.S. Federal Income Tax Consequences to Holders of UBSH Common Stock (page       )

The merger will not result in the recognition of gain or loss for U.S. federal income tax purposes by holders of UBSH common stock.

Dissenters’ and Appraisal Rights (page       )

The shareholders of UBSH are not entitled to dissenters’ or appraisal rights in connection with the merger.

Holders of FMB common stock and Series A preferred stock have the right to demand and receive payment of the fair value of their shares pursuant to the provisions of 12 C.F.R. § 552.14.

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Regulatory Approvals (page       )

We cannot complete the merger unless it is approved by the Board of Governors of the Federal Reserve System and the Virginia State Corporation Commission. On                     , 2009, UBSH filed the required applications with the Federal Reserve and the Virginia State Corporation Commission.

As of the date of this proxy statement, we have not yet received the required approvals. While we do not know of any reason why we would not be able to obtain the necessary approvals in a timely manner, we cannot be certain when or if we will receive them.

Conditions to Completion of the Merger (page       )

Our respective obligations to complete the merger are subject to the fulfillment or waiver of certain conditions, including the following:

Where the law permits, UBSH and FMB could choose to waive a condition to its obligation to complete the merger even if that condition has not been satisfied. We cannot be certain when, or if, the conditions to the merger will be satisfied or waived or that the merger will be completed.

Timing of the Merger (page       )

We expect to complete the merger after all conditions to the merger in the merger agreement are satisfied or waived, including after shareholder approvals are received at the special meetings of UBSH and FMB and all required regulatory approvals are received. We currently expect to complete the merger during the fourth quarter of 2009. However, it is possible that factors outside of either party’s control could require us to complete the merger at a later time or not to complete it at all.

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No Solicitation (page       )

FMB has agreed that it will not directly or indirectly:

Termination of the Merger Agreement (page       )

The merger agreement may be terminated, and the merger abandoned, by UBSH and FMB at any time before the merger is completed if the boards of directors of both parties vote to do so. In addition, the merger agreement may be terminated, and the merger abandoned, by either party’s board of directors if:

In addition, either party may terminate the merger agreement if the board of directors of the other party withdraws or modifies its recommendation to its shareholders concerning the proposals for shareholder approval under the merger agreement be approved in any way which is adverse to the non-recommending party, or the other party materially breaches its covenants requiring the calling and holding of a meeting of shareholders to consider the proposals for shareholder approval under the merger agreement.

FMB may also terminate the merger agreement if UBSH enters into a definitive agreement providing for a merger or other business combination transaction with any other corporation or entity in which UBSH would not be the surviving or continuing entity after the consummation of such transaction.

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Expenses and Termination Fees (page       )

In general, whether or not the merger is consummated, UBSH and FMB will each pay its respective expenses incident to preparing, entering into and carrying out the merger agreement, and preparing and filing this proxy statement. In addition, each party must pay the other a termination fee of $5,000,000 if the merger agreement is terminated by either UBSH or FMB under certain specified circumstances. The termination and the payment circumstances are more fully described on page        of the merger agreement.

Transition Committee (page       )

If UBSH wishes to take certain major corporate actions before the merger, prior approval is required by a transition committee comprised of the current UBSH directors and James E. Ukrop and Steven E. Markel, current FMB directors. Transition committee approval will be required before UBSH issues any securities in order to redeem its outstanding Series A preferred stock or in connection with a business acquisition, incurs any obligation or liability or encumbers or disposes any of its assets (other than in ordinary course), declares any dividend greater than that permitted under the merger agreement, adjusts or splits its common stock, redeems or repurchases shares (other than as permitted in the merger agreement) or makes any material investment or acquisition.

Affiliate Agreement (page       )

UBSH has entered into an agreement with certain shareholders of FMB pursuant to which the FMB shareholders have agreed individually to vote all of their shares in favor of the merger agreement. As of March 30, 2009, such individuals owned shares representing approximately 97% of the voting power of FMB common stock and Series A preferred stock entitled to vote at the special meeting of FMB shareholders to approve the merger.

The Special Meeting (page       )

The special meeting will be held on                     , 2009 at          :              .m. local time, at the UBSH Operations Center, 24010 Partnership Boulevard, Ruther Glen, Virginia.

At the special meeting, the shareholders of UBSH will be asked:

Record Date; Votes Required (page       )

You can vote at the UBSH special meeting of shareholders if you owned UBSH common stock at the close of business on                     , 2009. On that date, UBSH had [                ] shares of common stock outstanding and entitled to vote. For each proposal presented at the special meeting, a shareholder can cast one vote for each share of UBSH common stock owned on the record date.

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The UBSH proposal to issue additional shares of common stock to FMB shareholders requires the affirmative vote of a majority of the total votes cast on the proposal.

The UBSH proposal to amend the company’s articles of incorporation to change the name of the company to [“Union First Market Bankshares Corporation”] requires the affirmative vote of a majority of all votes entitled to be cast on the proposal.

Approval of a motion to adjourn or postpone the UBSH special meeting to permit further solicitation of proxies to approve the matters to be considered at the meeting requires the affirmative vote of a majority of the shares represented at the special meeting, whether or not a quorum is present.

FMB will hold a special meeting of its shareholders to approve the merger agreement. The approval of the merger agreement by FMB shareholders requires the affirmative vote of a majority of shares of FMB Class A common stock and Series A preferred stock, voting together as a single class, and the affirmative vote of a majority of shares of FMB Class B common stock, voting as a separate class.

Voting by UBSH Directors and Executive Officers (page       )

As of                 , 2009, the record date for the UBSH special meeting, directors and executive officers of UBSH and their affiliates owned and are entitled to vote                  shares of UBSH common stock, or approximately         % of the total voting power of the shares of UBSH common stock outstanding on that date.

The Merger Will Be Accounted for Under the Acquisition Method of Accounting (page       )

UBSH will use the acquisition method of accounting to account for the merger.

Listing of Combined Company Common Stock (page       )

UBSH will list the shares of combined company common stock to be issued in the merger on the NASDAQ Global Select Market.

UBSH Market Prices and Share Information (page       )

UBSH common stock is listed on the NASDAQ Global Select Market under the symbol “UBSH.” FMB common stock is not traded on any public stock exchange or market. The following table sets forth the closing sale price per share of UBSH common stock as reported on the NASDAQ Global Select Market on March 27, 2009, the last trading day before we announced the signing of the merger agreement, and on                 , 2009, the last trading day before the date of this proxy statement.

UBSH Common Stock

UBSH cannot assure you that its stock price will continue to trade at or above the prices shown above. You should obtain current stock price quotations for UBSH common stock from a newspaper, via the Internet or by calling your broker.

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SELECTED HISTORICAL FINANCIAL DATA OF UBSH

The following table sets forth certain of UBSH’s consolidated financial data as of the end of and for each of the years in the five-year period ended December 31, 2008 and as of and for the three months ended March 31, 2009 and 2008. The historical consolidated financial information as of the end of and for each of the years in the five-year period ended December 31, 2008, is derived from UBSH’s audited consolidated financial statements, which are incorporated by reference into this proxy statement. The consolidated financial information as of and for the three-month periods ended March 31, 2009 and 2008 is derived from UBSH’s unaudited consolidated financial statements, which are incorporated by reference into this proxy statement. In UBSH’s opinion, such unaudited consolidated financial statements include all adjustments (consisting of normal recurring adjustments) necessary for a fair presentation of its financial position and results of operations for such periods. Interim results for the three months ended March 31, 2009 are not necessarily indicative of, and are not projections for, the results to be expected for the full year ending December 31, 2009.

The selected historical financial data below is only a summary and should be read in conjunction with the consolidated financial statements that are incorporated by reference into this proxy statement and their accompanying notes.

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Union Bankshares Corporation

(Amounts in thousands, except per share information)

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SELECTED HISTORICAL FINANCIAL DATA OF FMB

The following table sets forth certain of FMB’s consolidated financial data as of and for each of the years in the five-year period ended December 31, 2008 and as of and for the three months ended March 31, 2009 and 2008. The historical consolidated financial information as of and for each of the years in the five-year period ended December 31, 2008 is derived from FMB’s audited consolidated financial statements. The consolidated financial information as of and for the three-month periods ended March 31, 2009 and 2008 is derived from FMB’s unaudited consolidated financial statements. FMB’s audited consolidated financial statements for the years ended December 31, 2008 and 2007, and FMB’s unaudited consolidated financial statements for the three months ended March 31, 2009 and 2008, begin on page F-1 of this proxy statement. In FMB’s opinion, such unaudited consolidated financial statements include all adjustments (consisting of normal recurring adjustments) necessary for a fair presentation of its financial position and results of operations for such periods. Interim results for the three months ended March 31, 2009 are not necessarily indicative of, and are not projections for, the results to be expected for the full year ending December 31, 2009.

The selected historical financial data below is only a summary and should be read in conjunction with the consolidated financial statements included in this proxy statement and their accompanying notes.

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First Market Bank

(Amounts in thousands, except per share information)

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SUMMARY UNAUDITED PRO FORMA COMBINED FINANCIAL DATA

The following summary unaudited pro forma combined financial information is designed to show how the merger might have affected historical financial statements if the merger had been completed at an earlier time and was prepared based on the historical financial results reported by UBSH and provided by FMB for use in this proxy statement. The following should be read in connection with “Unaudited Pro Forma Condensed Combined Financial Information” beginning on page __, UBSH’s audited consolidated financial statements that are incorporated by reference into this proxy statement and FMB’s audited consolidated financial statements which begin on page F-1 of this proxy statement.

The unaudited pro forma balance sheet data assumes that the merger took place on March 31, 2009 and combines UBSH’s consolidated balance sheet as of March 31, 2009 with FMB’s consolidated balance sheet as of March 31, 2009. The unaudited pro forma statements of operations data for the three months ended March 31, 2009 and for the year ended December 31, 2008 give effect to the merger as if it occurred on January 1, 2008.

The unaudited pro forma combined financial information, while helpful in illustrating the financial characteristics of the combined company under one set of assumptions, does not reflect the benefits of expected cost savings or opportunities to earn additional revenue and, accordingly, does not attempt to predict or suggest future results. It also is not necessarily indicative of the financial condition or results of operations of future periods or the financial condition or results of operations that actually would have been realized had the companies been combined during these periods.

We expect that we will incur merger and integration charges as a result of the merger. We also anticipate that the merger will provide the combined company with financial benefits that may include reduced operating expenses and opportunities to earn additional revenue. The information set forth below, while helpful in illustrating the financial characteristics of the combined company under one set of assumptions, may not reflect all of these anticipated financial expenses and benefits and, accordingly, does not attempt to predict or suggest future results. It also does not necessarily reflect what the historical results of the combined company would have been had our companies been combined during the periods presented.

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Union Bankshares Corporation

Selected Unaudited Pro Forma Condensed Combined Financial Data

(Amounts in thousands, except per share data)

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COMPARATIVE UNAUDITED PER SHARE DATA

The following table shows per common share data regarding earnings, book value, and cash dividends declared for UBSH and FMB on a historical, pro forma and pro forma equivalent basis. The pro forma and pro forma equivalent per share information was computed as if the merger had been completed on December 31, 2008 or March 31, 2009. The FMB pro forma equivalent information was calculated by multiplying the corresponding pro forma combined data by the exchange ratio of 6,273.259 to 1.0. This information shows how each share of FMB common stock would have participated in the combined companies’ net income, book value per share, and cash dividends if the merger had been completed on the relevant dates. These amounts do not necessarily reflect future per share amounts of earnings, book value per share or cash dividends of the combined company.

The following unaudited comparative per share data is derived from the historical consolidated financial statements of each of UBSH and FMB. The pro forma data does not give effect to the reduction in operating expenses and the revenue enhancement opportunities that are anticipated subsequent to the merger. Therefore, while helpful in illustrating the financial characteristics of the merger under one set of circumstances, the pro forma data is not indicative of the results of future operations or other actual results that would have occurred had the merger been consummated at the beginning of the periods presented. The information below should be read in conjunction with the audited consolidated financial statements and accompanying notes of UBSH, which are incorporated by reference into this proxy statement and the audited consolidated financial statements and accompanying notes of FMB, which begin on page F-1 of this proxy statement.

As of and for the year ended December 31, 2008

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RISK FACTORS

In addition to the other information contained in or incorporated by reference into this proxy statement, you should consider carefully the following risk factors in deciding how to vote on the merger proposals. Many of these risks and uncertainties could affect the combined company’s future financial results and may cause the combined company’s future earnings and financial condition to be less favorable than UBSH’s expectations. In addition, you should read and consider the risks associated with the business of UBSH because these risks will also relate to the combined company. Certain of these risks are highlighted on page      under the heading “Cautionary Statement Regarding Forward-Looking Statements.” Certain risks can also be found in the documents incorporated by reference into this proxy statement.

The merger consideration for the FMB common stock is fixed despite any change in UBSH’s stock price.

Each share of FMB common stock will be converted into the right to receive 6,273.259 shares of the common stock of the combined company, the value of which will depend upon the price of UBSH common stock. The price of UBSH common stock when the merger takes place may vary from its price at the date the fixed exchange rate was established, at the date of this proxy statement and at the date of UBSH’s special meeting. Such variations in the price of UBSH common stock may result from changes in the business, operations or prospects of UBSH, regulatory considerations, general market and economic conditions, and other factors. At the time of UBSH’s special meeting, shareholders will not know the exact value of the consideration to be paid by UBSH when the merger is completed.

If FMB and UBSH do not successfully integrate, the combined company may not realize the expected benefits from the merger.

UBSH expects that the combined company will be able to maintain most of FMB and UBSH’s key customers and personnel and integrate their systems and operations successfully. Integration in connection with a merger is sometimes difficult, and there is a risk that integrating the two companies may take more time and resources than we expect.

The combined company’s ability to integrate and its future success depend in large part on the ability of members of the combined company’s board of directors to work together effectively. The combined company will be governed by a board of directors comprised of thirteen directors, of which ten will be the current UBSH directors and three will be current directors of FMB. Current UBSH president and chief executive officer, G. William Beale, will serve as chief executive officer of the combined company. Current FMB chief executive officer David J. Fairchild will serve as president of the combined company. Disagreements among board members of the combined company could arise in connection with integration issues, strategic considerations and other matters. As a result, there is a risk that the combined company’s board of directors may not be able to operate effectively, which would affect adversely the combined company’s ability to integrate the operations of UBSH and FMB successfully.

Combining UBSH and FMB may be more difficult, costly or time-consuming than we expect.

UBSH and FMB have operated, and, until the completion of the merger, will continue to operate, independently. The integration process could result in the loss of key employees, the disruption of each party’s ongoing business, inconsistencies in standards, controls, procedures and policies that affect adversely either party’s ability to maintain relationships with customers and employees or achieve the anticipated benefits of the merger. As with any merger of financial institutions, there also may be disruptions that cause UBSH and FMB to lose customers or cause customers to withdraw their deposits from FMB or UBSH’s banking subsidiaries, or other unintended consequences that could have a material adverse effect on UBSH’s results of operations or financial condition.

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CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING STATEMENTS

The Private Securities Litigation Reform Act of 1995 provides a “safe harbor” for forward-looking statements to encourage companies to provide prospective information, so long as those statements are identified as forward-looking and are accompanied by meaningful cautionary statements identifying important factors that could cause actual results to differ materially from those discussed in the statement. UBSH desires to take advantage of these “safe harbor” provisions with regard to the forward-looking statements in this proxy statement and in the documents that are incorporated herein by reference. These forward-looking statements reflect our current views with respect to future events and financial performance. Specifically, forward-looking statements may include:

These forward-looking statements express our best judgment based on currently available information and we believe that the expectations reflected in our forward-looking statements are reasonable.

By their nature, however, forward-looking statements often involve assumptions about the future. Such assumptions are subject to risks and uncertainties that could cause actual results to differ materially from those described in the forward-looking statements. As such, we cannot guarantee you that the expectations reflected in our forward-looking statements actually will be achieved. Actual results may differ materially from those in the forward-looking statements due to, among other things, the following factors:

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We caution you not to place undue reliance on any forward-looking statements, which speak only as of the date of this proxy statement or, in the case of a document incorporated herein by reference, as of the date of that document. Except as required by law, UBSH undertakes no obligation to publicly update or release any revisions to these forward-looking statements to reflect any events or circumstances after the date hereof or to reflect the occurrence of unanticipated events.

Additional factors that could cause actual results to differ materially from those expressed in the forward-looking statements are discussed in reports filed with the Securities and Exchange Commission by UBSH. See “Where You Can Find More Information” beginning on page      for a list of the documents incorporated herein by reference.

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THE SPECIAL MEETING

Date, Place and Time

This proxy statement is first being mailed on or about                     , 2009 to UBSH shareholders who held shares of common stock, par value $1.33 per share, on the record date for the UBSH special meeting of shareholders. This proxy statement is accompanied by the notice of the special meeting and a form of proxy that is solicited by the board of directors of UBSH for use at the special meeting to be held on                     , 2009, at         :              .m. local time, at the UBSH Operations Center, which is located at 24010 Partnership Boulevard, Ruther Glen, Virginia, and at any adjournment or postponement of that meeting.

Purpose of the Special Meeting

At the special meeting, the shareholders of UBSH will be asked:

Recommendation of the UBSH Board of Directors

The UBSH board believes that the proposed merger with FMB is fair to and is in the best interests of UBSH and its shareholders and unanimously recommends that shareholders vote “FOR” each of the proposals described in this proxy statement.

Record Date and Voting Rights

The UBSH board of directors has fixed the close of business on [                    , 2009] as the record date for determining the shareholders entitled to notice of and to vote at the special meeting or any postponement or adjournment thereof. Accordingly, you are only entitled to notice of and to vote at the special meeting if you were a record holder of UBSH common stock at the close of business on the record date. At that date, [                    ] shares of UBSH common stock were outstanding.

To have a quorum that permits us to conduct business at the UBSH special meeting, we require the presence, whether in person or by proxy, of the holders of UBSH’s common stock representing a majority of the shares outstanding on the record date. You are entitled to one vote for each outstanding share of UBSH common stock you held as of the close of business on the record date.

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Holders of shares of UBSH common stock present in person at the special meeting but not voting, and shares of the common stock for which we have received proxies indicating that their holders have abstained, will be counted as present at the special meeting for purposes of determining whether we have a quorum for transacting business. Shares held in street name that have been designated by brokers on proxies as not voted will not be counted as votes cast for or against any proposal. These broker non-votes will, however, be counted for purposes of determining whether a quorum exists.

Votes Required

Vote required to approve the issuance of common stock to FMB shareholders. The approval of the issuance of up to approximately 7.5 million shares of UBSH common stock to FMB shareholders in the merger requires the affirmative vote of a majority of the total votes cast on the proposal.

Abstentions and broker non-votes will not count as votes cast.

Vote required to approve the amendment to the articles of incorporation to change the name of the combined company to [“Union First Market Bankshares Corporation”]. The approval of the amendment to the UBSH articles of incorporation to change the name of the company to [“Union First Market Bankshares Corporation”] requires the affirmative vote of a majority of all votes entitled to be cast.

Abstentions and broker non-votes will not count as votes cast. Because approval of the amendment to the articles of incorporation requires the affirmative vote of at least a majority of the shares of UBSH common stock outstanding on the record date, abstentions and broker non-votes will have the same effect as votes against the proposed amendment to the articles of incorporation.

Vote Required for Adjournment or Postponement of the Special Meeting. Approval of any motion to adjourn or postpone the special meeting to permit further solicitation of proxies to approve the matters to be considered at the meeting requires the affirmative vote of a majority of the shares of UBSH common stock represented at the special meeting, whether or not a quorum is present.

Abstentions and broker non-votes will not count as votes cast and will have no effect for purposes of determining whether a proposal to adjourn or postpone the special meeting has been approved.

Stock Ownership of UBSH Executive Officers and Directors

As of the record date, directors and executive officers of UBSH and their affiliates beneficially owned and were entitled to vote approximately              shares of UBSH common stock at the special meeting. These shares represent approximately      % of the aggregate voting power of UBSH shares entitled to vote at the special meeting.

Voting of Proxies

By Mail. A proxy card is enclosed for your use. To submit your proxy by mail, please complete and sign the accompanying proxy and, if you are a shareholder of record, return it as soon as possible in the enclosed postage-paid envelope. If you hold your shares in street name, please refer to your proxy card or the information provided to you by your bank, broker, custodian or record holder. When the accompanying proxy is returned properly executed, the shares of UBSH common stock represented by it will be voted at the UBSH special meeting in accordance with the instructions contained in the proxy.

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If proxies are returned properly executed without indication as to how to vote, the UBSH common stock represented by each such proxy will be considered to be voted in favor of all matters for consideration at the UBSH special meeting as follows: (i) “FOR” the proposal to issue up to approximately 7.5 million shares of common stock to FMB shareholders; (ii) “FOR” the proposal to amend the UBSH articles of incorporation to change its corporate name; and (iii) “FOR” the proposal to adjourn or postpone the meeting to permit the further solicitation of proxies.

If the special meeting is postponed or adjourned, all proxies will be voted at the reconvened special meeting in the same manner as they would have been voted at the originally scheduled special meeting, except for any proxies that have been properly withdrawn or revoked.

Your vote is important. Accordingly, please sign, date and return the enclosed proxy card whether or not you plan to attend the UBSH special meeting in person.

Voting In Person. If you wish to vote in person at the special meeting, a ballot will be provided at the special meeting. However, if your shares are held in the name of your bank, broker, custodian or other record holder, you must obtain a proxy, executed in your favor, from the holder of record to be able to vote your shares at the meeting.

Revocation of Proxies

You have the power to revoke your proxy at any time before your proxy is voted at the special meeting. If you grant a proxy in respect of your UBSH shares and then attend the special meeting in person, your attendance at the special meeting or at any adjournment or postponement will not automatically revoke your proxy. Your proxy can be revoked in one of three ways:

If you choose either of the first two methods, you must submit your notice of revocation or new proxy to UBSH Investor Relations Department at Union Bankshares Corporation, 211 North Main Street, P.O. Box 446, Bowling Green, Virginia 22427-0446, Attention: Investor Relations, no later than the beginning of the UBSH special meeting or, if the special meeting is adjourned or postponed, before the adjourned or postponed meeting is actually held.

If your shares are held in the name of a broker or nominee, you may change your vote by submitting new voting instructions to your broker or nominee.

If you need assistance in changing or revoking your proxy, please contact UBSH Investor Relations by calling (804) 633-5031 or by writing to Union Bankshares Corporation, 211 North Main Street, P.O. Box 446, Bowling Green, Virginia 22427-0446, Attention: Investor Relations.

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Solicitation of Proxies

This solicitation is made on behalf of the UBSH board of directors, and UBSH will pay the costs of soliciting and obtaining proxies, including the cost of reimbursing banks and brokers for forwarding proxy materials to shareholders. Proxies may be solicited, without extra compensation, by UBSH’s officers and employees by mail, electronic mail, telephone, fax or personal interviews. UBSH will also reimburse brokers and other custodians, nominees and fiduciaries for their expenses in sending these materials to you and getting your voting instructions.

Householding

The Securities and Exchange Commission has adopted rules that permit companies and intermediaries such as brokers to satisfy delivery requirements for proxy statements with respect to two or more shareholders sharing the same address by delivering a single proxy statement addressed to those shareholders. This process, which is commonly referred to as “householding,” potentially provides extra convenience for shareholders and cost savings for companies. UBSH and some brokers household proxy materials, delivering a single proxy statement to multiple shareholders sharing an address unless contrary instructions have been received from the affected shareholders. Once you have received notice from your broker or UBSH that it or UBSH will be householding materials to your address, householding will continue until you are notified otherwise or until you revoke your consent. If, at any time, you no longer wish to participate in householding and would prefer to receive a separate proxy statement, please notify your broker if your shares are held in a brokerage account or UBSH if you hold registered shares. You can notify UBSH by sending a written request to the company’s Corporate Secretary, Union Bankshares Corporation, P. O. Box 446, Bowling Green, Virginia 22427-0446.

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THE MERGER

The following is a summary description of the material aspects of the merger agreement and the merger. This description does not purport to be complete and is qualified in its entirety by reference to the merger agreement, which is attached as Annex A to this proxy statement. We urge you to read the merger agreement in its entirety.

General

The UBSH board of directors has approved the merger agreement, which provides for combining UBSH and FMB through the merger of FMB with and into a newly-formed interim bank subsidiary of UBSH. After the merger, the combined company will operate under the new name of [“Union First Market Bankshares Corporation”], and the continuing bank from the merger will operate as a Virginia chartered bank subsidiary of UBSH under the name “First Market Bank” until such time as Union Bank and Trust Company, a Virginia banking subsidiary of UBSH, merges into the continuing bank and the combined bank operates under the new name of                     .

Each share of FMB common stock issued and outstanding before the merger will be converted into the right to receive 6,273.259 shares of common stock of the combined company. We sometimes refer to this as the “common stock exchange ratio.” The common stock exchange ratio is fixed and will not be adjusted to reflect stock price changes prior to the effective date of the merger. In addition, each share of FMB Series A preferred stock issued and outstanding before the merger will be converted into the number of shares of common stock of the combined company that is equal to the quotient determined by dividing $100,000 (the stock’s liquidation preference) by the 10-day average trading price of UBSH common stock as of the fifth business day before closing, provided that the average trading price will not be more than $16.89 or less than $12.89. No fractional shares will be issued, and cash will be paid instead. Shares of FMB common stock and Series A preferred stock issued and outstanding before the merger will be cancelled upon completion of the merger.

Each share of the Fixed Rate Non-Cumulative Perpetual Preferred Stock, Series B, and the Fixed Rate Non-Cumulative Perpetual Preferred Stock, Series C, of FMB issued to the U. S. Treasury and outstanding before the merger will be converted into and exchanged for one share of a corresponding series of preferred stock of the combined company with substantially identical preferences, rights and limitations.

Each share of UBSH common stock issued and outstanding before the merger will remain issued and outstanding, and existing stock certificates of UBSH will continue to represent the same number of shares of common stock of the combined company after the merger.

As of the date of this proxy statement, the combined company expects that it will issue approximately [            ] shares of common stock to the holders of FMB common stock in the merger and approximately another [            ] shares of common stock to the holder of the Series A preferred stock, based on the current market price of UBSH common stock. At the completion of the merger, we expect that there will be issued and outstanding approximately [            ] shares of common stock of the combined company, with current UBSH shareholders owning approximately 65% of the combined company’s outstanding common stock, on a fully diluted basis, and current holders of FMB common stock and Series A preferred stock owning approximately 35% of the combined company’s outstanding common stock on a fully diluted basis.

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The merger agreement also provides that the headquarters of the combined company will be in Richmond, Virginia and the operations center for the combined company and its subsidiary banks will be in Caroline County, Virginia.

Background of the Merger

UBSH’s board of directors has periodically engaged with senior management in reviews of the business and strategic direction of UBSH and has considered ways to enhance the company’s performance and prospects in light of competitive and other relevant developments. These reviews have focused on, among other things, the business environment facing financial institutions generally, as well as conditions and ongoing consolidation in the financial services industry. These reviews have also included periodic discussions with respect to potential transactions that would further the company’s strategic objectives, and the potential benefits and risks of those transactions, and from time to time have focused on the possibility of a merger with another major Virginia-based banking organization.

Over the past several years at industry conferences and in other settings, members of senior management of UBSH and FMB have had informal discussions about their respective companies and trends in the banking industry. In mid-October 2008, senior management of FMB contacted senior management of UBSH on a very preliminary basis about the possibility of considering the merits of a merger of the two companies. Following this initial contact, informal discussions continued between senior management of the two companies and representatives of Cary Street Partners LLC, a regional investment banking firm (“CSP”) acting as financial advisor to FMB, during October and November, which led to a meeting on December 3, 2008 focusing on the companies’ respective corporate cultures and pricing in the event of a merger.

On December 5, 2008, UBSH senior management briefed the UBSH executive committee about the potential merger opportunity with FMB. At this meeting, the UBSH executive committee authorized senior management to evaluate further a possible transaction with FMB.

In early January 2009, senior management of UBSH and representatives of Keefe, Bruyette & Woods, Inc., a nationally recognized investment banking firm, had several meetings and conversations with senior management of FMB and representatives of CSP to conduct preliminary due diligence and to explore various issues related to the senior level and mid-level management structure of a possible merger.

During these early stage discussions in January and February 2009, the senior management and the executive committee of UBSH began to consider in more detail the potential financial, operational, governance and other terms and conditions of a combination with FMB. These discussions focused on, among other things, an all-stock transaction with a fixed, at-market exchange ratio, a fairly apportioned board and management team for the combined company and combined bank, the conversion of the Series A preferred stock to UBSH common stock, and the advisability of selecting a new corporate name for the combined company.

At a special meeting on February 3, 2009, the UBSH board was briefed on the discussions that senior management was having with senior management of FMB regarding a possible merger. The board encouraged UBSH senior management to continue exploring the merger with its FMB counterparts. At this meeting, the board authorized the engagement of KBW to advise UBSH on the financial implications of a merger with FMB. On February 19, 2009, UBSH engaged KBW to provide UBSH with advice concerning the merger.

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At its regularly scheduled meeting on February 26, 2009, the UBSH board considered the terms of a proposed merger with FMB as provided in a preliminary non-binding term sheet. During and after a presentation by UBSH senior management and KBW on the merger, the UBSH board discussed various aspects of the proposed combination of UBSH and FMB. At this meeting, the UBSH board authorized senior management to proceed towards a merger with FMB, to conduct due diligence on FMB and to begin negotiations that would lead to a definitive agreement in accordance with the terms and conditions outlined in the preliminary term sheet.

At this time, the parties and their financial and legal advisors commenced mutual due diligence reviews. Counsel for the parties also began drafting the transaction documents to reflect the terms and conditions outlined in the preliminary non-binding term sheet. Due diligence continued over the course of the next several weeks, as the parties and their counsel continued to negotiate the terms of the definitive merger agreement and other related agreements.

On March 26, 2009, the board of directors of UBSH held a special meeting to meet with senior management and its outside financial and legal advisors. Management reviewed for the UBSH board of directors the progress of its negotiations with FMB and reported on the status of its due diligence investigation of FMB. KBW reviewed with the UBSH board of directors the structure and other terms of the proposed transaction and financial information regarding FMB, UBSH and the transaction, information regarding peer companies and comparable transactions and other relevant analyses. In connection with the deliberations by the UBSH board, KBW rendered to the board its oral opinion (subsequently confirmed in writing), as described under the “— Opinion of UBSH’s Financial Advisor,” that as of the date of its opinion, the consideration to be paid in the merger was fair, from a financial point of view, to UBSH.

At that meeting, representatives of LeClairRyan, A Professional Corporation, UBSH’s legal counsel, discussed with the UBSH board of directors the legal standards applicable to its decisions and actions with respect to its consideration of the proposed merger, and reviewed the legal terms of the proposed merger agreement and related transaction agreements, including the proposed terms of the registration rights agreement with certain shareholders of FMB and the proposed employment agreement with David J. Fairchild that would become effective upon completion of the merger.

After review and discussion among members of the UBSH board of directors, including consideration of the factors described under “— UBSH’s Reasons for the Merger; Recommendation of UBSH’s Board of Directors,” the UBSH board adjourned the special meeting and reconvened on Saturday morning, March 28, to further consider the merger. Following further discussions at the adjourned session on March 28, and after being advised that the FMB board of directors at its meeting held on Friday, March 27, approved the merger and being briefed by counsel on the changes to the merger agreement from the draft merger agreement previously reviewed on March 26, the UBSH board of directors determined that the transactions contemplated by the merger agreement and the related transactions and agreements are advisable and in the best interests of UBSH and its shareholders and the directors voted unanimously to approve the merger with FMB, to approve and adopt the merger agreement and to approve the related transactions and agreements.

Following completion of the meeting of the UBSH board on March 28, 2009, the merger agreement and related agreements were placed in final form and were executed and delivered on Monday morning, March 30. The transaction was announced before the market opened on March 30, 2009 in a press release issued jointly by UBSH and FMB.

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In mid-April 2009, senior management of UBSH and FMB began to discuss on a preliminary basis the advisability of combining FMB and Union Bank and Trust Company, an existing Virginia banking subsidiary of UBSH, into a single bank that would be branded under a new name. This represented a departure from the terms of the merger agreement executed and delivered on March 30, which provided that the continuing bank, after the interim bank’s merger with FMB, would continue to operate as a Virginia chartered bank separate and apart from UBTC. Combining the continuing bank and UBTC into a single bank after the merger offered a number of advantages and chief among them was the benefit of having a single bank, with a larger lending limit and wider range of products and services, to serve the entire Richmond metropolitan area and the many other Virginia counties already served by UBTC.

Senior management of UBSH and FMB briefed their respective boards of directors concerning the possible combination of the two banks and were authorized to retain Boisseau Partners, an advertising agency based in Richmond, Virginia, to advise the parties on proposed names and branding strategies for the combined bank. In addition, UBSH and FMB authorized their respective counsel to prepare an amendment to the merger agreement to reflect this proposed change and certain related changes to the original merger agreement.

During May and June 2009, senior management of UBSH and FMB continued their discussions on combining FMB and UBTC. At a meeting on June 18, 2009, the UBSH board of directors approved moving forward with amending the merger agreement and authorized certain UBSH executive officers to execute such amended agreement to reflect a revised structure of the business combination, by which UBSH would establish an interim bank subsidiary into which both FMB and UBTC would eventually merge, resulting in a combined Virginia bank subsidiary of which UBSH would be the parent company. On June 17, 2009, the FMB board, acting by unanimous written consent, approved amending the merger agreement and authorized certain FMB executive officers to execute such amended agreement to reflect the revised structure. On June 19, 2009, the parties entered into the First Amended and Restated Agreement and Plan of Reorganization. At a meeting on June 25, 2009, the UBSH board ratified the amended merger agreement.

UBSH’s Reasons for the Merger; Recommendation of UBSH’s Board of Directors

In reaching its decision to adopt the merger agreement and recommend approval of the merger related matters to shareholders, the UBSH board of directors consulted with senior management, as well as with its outside financial and legal advisors, and considered a number of factors, including, but not limited to, the following: