<PAGE>
[LOGO]
BARNETT BANKS, INC.
50 N. LAURA STREET--JACKSONVILLE, FLORIDA 32202
February 28, 1997
Dear Shareholder:
You are cordially invited to attend the Annual Meeting of Shareholders of
Barnett Banks, Inc. at 10:00 a.m. on Wednesday, April 16, 1997. A formal notice
setting forth the business to come before the meeting and a proxy statement are
attached. The meeting will be held in Building 500 of the Barnett Office Park,
9000 Southside Boulevard, Jacksonville, Florida. A map appears on the back cover
of this proxy statement.
At the meeting, you will be asked to elect five directors, each to serve for
a three-year term, and to approve the Company's Performance-Based Incentive
Plan. The Board of Directors recommends a vote "For" the election of the
nominees and "For" approval of the Performance-Based Incentive Plan.
Regardless of the number of shares you own, it is important that they are
voted at the meeting. Accordingly, please sign, date and mail the enclosed proxy
in the envelope provided for your convenience.
Thank you for your cooperation and continued support.
/s/ CHARLES E. RICE
CHARLES E. RICE
CHAIRMAN AND CHIEF EXECUTIVE OFFICER
<PAGE>
BARNETT BANKS, INC.
------------------
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
TO BE HELD APRIL 16, 1997
---------------------
TO THE HOLDERS OF COMMON STOCK :
NOTICE IS HEREBY GIVEN that the Annual Meeting of Shareholders of Barnett
Banks, Inc. (the "Company" or "Barnett") will be held on Wednesday, April 16,
1997, at 10:00 a.m., in Building 500 of the Barnett Office Park, 9000 Southside
Boulevard, Jacksonville, Florida to consider and act upon the following matters:
1. Election of five directors of the Company, each for a three-year
term;
2. Approval of the Company's Performance-Based Incentive Plan; and
3. Such other business as may properly come before the meeting or any
adjournments thereof.
Only shareholders of record of the Company's common stock at the close of
business on February 5, 1997 are entitled to notice of, and to vote on, all
business that may come before the Annual Meeting.
Whether or not you plan to attend the meeting, please complete, sign and
date the enclosed proxy and return it promptly to the Company in the
postage-paid envelope enclosed for your use. You may revoke the proxy at any
time before it is exercised by following the instructions set forth on the first
page of the accompanying proxy statement.
By Order of the Board of Directors,
/s/ CATHERINE C. COSBY
CATHERINE C. COSBY
CORPORATE SECRETARY
Dated: February 28, 1997
<PAGE>
BARNETT BANKS, INC.
50 N. LAURA STREET
JACKSONVILLE, FLORIDA 32202
------------------------
PROXY STATEMENT
------------------------
This proxy statement and the enclosed proxy are being furnished in
connection with the solicitation by the Board of Directors of Barnett Banks,
Inc. of proxies to be voted at the Annual Meeting of Shareholders of the Company
to be held Wednesday, April 16, 1997, and any adjournments thereof. This proxy
statement and the accompanying proxy are being distributed to shareholders on or
about February 28, 1997.
The number printed in the upper right hand corner of the proxy/voting
instruction card accompanying this proxy statement indicates the number of
shares owned and includes, when applicable, shares held in the Barnett Employee
Savings and Thrift ("BEST") Plan or through any of the Company's other stock
purchase plans. The proxy will also instruct the trustees of the Company's stock
plans how to vote any shares of the Company's common stock allocated to the
accounts of participants in these plans.
Unless contrary instructions are received, the persons named in the
accompanying proxy will vote the shares represented by each proxy returned in
favor of the five directors nominated and for approval of the Performance-Based
Incentive Plan. Each such proxy granted may be revoked by its shareholder at any
time before it is exercised by filing with the Secretary of the Company an
instrument revoking it, or by voting in person at the Annual Meeting.
Barnett has a confidential voting policy which provides that votes of all
shareholders shall be held in confidence from the Company and its directors,
officers and employees except: (i) as necessary to meet applicable legal
requirements and to assert or defend claims for or against Barnett; (ii) in case
of a contested proxy solicitation; or (iii) in the event a shareholder has made
a written comment on the proxy material or has requested a waiver of
confidentiality. Barnett employs both an independent tabulator to receive and
tabulate the proxies and independent inspectors of election.
VOTING PROCEDURES
The Company's Bylaws provide that a majority of shares entitled to vote and
represented in person or by proxy at a meeting of the shareholders constitutes a
quorum. Under the Florida Business Corporation Act (the "Act"), directors are
elected by a plurality of the votes cast by the shares entitled to vote in the
election at a meeting at which a quorum is present. Other matters are approved
if affirmative votes cast by the holders of the shares represented at a meeting
at which a quorum is present and entitled to vote on the subject matter exceed
votes opposing the action, unless a greater number of affirmative votes or
voting by classes is required by the Act or the Company's Amended and Restated
Articles of Incorporation. Therefore, abstentions and broker non-votes have no
effect under Florida law. A broker non-vote generally occurs when a broker who
holds shares in street name for a customer does not have authority to vote on
certain non-routine matters under the rules of the New York Stock Exchange
because its customer has not provided any voting instructions on the matter.
VOTING SECURITIES AND PRINCIPAL HOLDERS
The record of shareholders entitled to vote was taken at the close of
business on February 5, 1997. Each share of common stock outstanding on that
date is entitled to one vote on each matter to come before the Annual Meeting.
On that date, the Company had outstanding 184,994,521 shares of common stock,
$2.00 par value. The closing price of the Company's common stock on the New York
Stock Exchange on February 5, 1997, as reported in THE WALL STREET JOURNAL, was
$44.50 per share.
<PAGE>
PROPOSAL 1: ELECTION OF DIRECTORS
The Board of Directors is divided into three classes serving staggered terms
in accordance with the Company's Amended and Restated Articles of Incorporation.
The terms of the directors in Class III expire this year, and each of these
directors has been nominated for election to a term of three years expiring in
2000.
The directors nominated for election at the 1997 Annual Meeting of
Shareholders are Marshall M. Criser, Jack B. Critchfield, Remedios Diaz Oliver,
Allen L. Lastinger, Jr. and Stewart Turley. Each of the nominees was elected to
the Board at the 1994 Annual Meeting of Shareholders except Mrs. Diaz Oliver,
who was elected at the 1995 Annual Meeting of Shareholders.
In order to be elected, each nominee must receive a plurality of the votes
cast, which shall be counted as described in VOTING PROCEDURES on page 1. The
accompanying proxy, unless otherwise specified, will be voted for the election
of the five persons named above. If any nominee should become unavailable, which
is not now anticipated, the persons voting the accompanying proxy may, in their
discretion, vote for a substitute.
THE BOARD OF DIRECTORS OF THE COMPANY RECOMMENDS A VOTE "FOR" THE ELECTION
OF EACH OF THE NOMINEES.
------------------------
Information relating to business experience, age and beneficial ownership of
Company securities of each director is set forth below. All stock information is
as of December 31, 1996. Unless otherwise noted, all shares are owned directly,
with sole voting and dispositive powers. In every instance, the shares of equity
securities owned by each director individually represent less than one percent
of the class owned. The shares indicated for each director have been adjusted
for a two-for-one stock split in September 1996. Directors' shares also include
those purchased as a result of termination of the Directors' Retirement Plan as
discussed on page 8.
------------------------
<TABLE>
<S> <C>
NOMINEES FOR TERMS EXPIRING IN 2000
CLASS III DIRECTORS
MARSHALL M. CRISER, 68, Chairman of the law firm of Mahoney Adams & Criser, P.A. since 16,276 shares of common stock (1)
October 1989 and President Emeritus of the University of Florida. Mr. Criser was elected
to the Board of Directors in 1989 and is a member of the Corporate Responsibility
Committee. Mr. Criser served as the President of the University of Florida from
September 1984 to March 1989. He is also a director of BellSouth Corporation, FPL Group,
Inc. and Perini Corporation, and serves as Chairman of the Emerald Funds Board of
Trustees.
JACK B. CRITCHFIELD, 63, Chairman and Chief Executive Officer of Florida Progress 15,772 shares of common stock (2)
Corporation and President Emeritus of Rollins College. Dr. Critchfield was elected to
the Board of Directors in 1977 and is Chairman of the Executive Compensation and
Management Development Committee and a member of the Executive Committee. Dr.
Critchfield has served as Chief Executive Officer of Florida Progress Corporation (a
diversified holding company with interests in mining, shipping, insurance and land
development, and parent of Florida Power Corporation) since February 1990, assuming the
additional responsibilities of Chairman of the Board on January 1, 1991. Dr. Critchfield
is a director of Florida Progress Corporation and its subsidiary, Florida Power
Corporation.
</TABLE>
2
<PAGE>
<TABLE>
<S> <C>
REMEDIOS DIAZ OLIVER, 58, President and Chief Executive Officer of All American 5,445 shares of common
Containers, Inc. Mrs. Diaz Oliver was elected to the Board of Directors in 1995 and is a stock
member of the Corporate Responsibility Committee. Mrs. Diaz Oliver has been the
President and Chief Executive Officer of All American Containers, Inc. and All American
Containers of Tampa, Inc. (distributors of glass, plastic and metal containers) since
October 1991. Mrs. Diaz Oliver is a director of Avon Products, Inc. and U.S. West, Inc.
ALLEN L. LASTINGER, JR., 54, President and Chief Operating Officer of the Company. Mr. 472,167 shares of common stock
Lastinger was elected to the Board of Directors in 1984. He has been an executive (3)(4)
officer of the Company since 1980 and has served as President and Chief Operating
Officer since January 1, 1991. Mr. Lastinger is Chairman, President and Chief Executive
Officer of Barnett Bank, N.A.
STEWART TURLEY, 62, Chairman of Eckerd Corporation. Mr. Turley was elected to the Board of 19,630 shares of common
Directors in 1976 and is Chairman of the Corporate Responsibility Committee and a member stock
of the Executive Committee. Mr. Turley served as Chairman, President and Chief Executive
Officer of Eckerd Corporation (a retail drug store chain) from 1974 to July 1993, as
Chairman and Chief Executive Officer from July 1993 to February 1996 and has served as
Chairman since February 1996. Mr. Turley is a director of Eckerd Corporation, Sprint
Corporation and Springs Industries, Inc.
OTHER DIRECTORS
CLASS I DIRECTORS
(TERMS EXPIRING IN 1998)
WALTER H. ALFORD, 58, Executive Vice President and General Counsel of BellSouth 15,615 shares of common stock (5)
Corporation. Mr. Alford was elected to the Board of Directors in 1982 and is a member of
the Audit Committee and the Strategic Planning Committee. Mr. Alford has served in his
BellSouth position since November 1987. He is a director of BellSouth International,
Inc.
RITA BORNSTEIN, 61, President of Rollins College (an independent, comprehensive liberal 8,192 shares of common
arts college with campuses in Winter Park and Melbourne, Florida). Dr. Bornstein was stock
elected to the Board of Directors in 1991 and is a member of the Audit Committee. Dr.
Bornstein was appointed to her current position in July 1990.
ALVIN R. CARPENTER, 55, President and Chief Executive Officer of CSX Transportation, Inc. 10,780 shares of common
Mr. Carpenter was elected to the Board of Directors in 1994 and is a member of the stock
Corporate Responsibility Committee and the Strategic Planning Committee. Mr. Carpenter
served as President of CSX Distribution Services from July 1989 to January 1992 when he
was elected to his present position. He is a director of Florida Rock Industries, Inc.,
Regency Realty Corporation, Stein Mart, Inc. and American Heritage Life Insurance
Company.
</TABLE>
3
<PAGE>
<TABLE>
<S> <C>
CLARENCE V. MCKEE, 54, Chairman, President and Chief Executive Officer of McKee 5,953 shares of common
Communications, Inc. (a firm involved in the acquisition and management of television stock
and radio stations). Mr. McKee was elected to the Board of Directors in 1990 and is a
member of the Corporate Responsibility Committee. He was a co-owner of WTVT Inc.,
licensee of WTVT Channel 13, Tampa, Florida, from 1987 to October 1992. Mr. McKee
formerly practiced law and served as a director of Legal Services Corporation,
Washington, D.C. He is a director of Florida Progress Corporation and its subsidiary,
Florida Power Corporation, American Heritage Life Insurance Company and Checkers
Drive-In Restaurants, Inc.
CHARLES E. RICE, 61, Chairman and Chief Executive Officer of the Company. Mr. Rice was 967,136 shares of common stock (3)
elected to the Board of Directors in 1972 and serves as Chairman of the Executive
Committee. He has served as Chief Executive Officer since 1979, assuming the additional
responsibilities of Chairman in 1984. Mr. Rice is a director of CSX Corporation and
Sprint Corporation.
CLASS II DIRECTORS
(TERMS EXPIRING IN 1999)
JAMES L. BROADHEAD, 61, Chairman and Chief Executive Officer of FPL Group, Inc. Mr. 6,520 shares of common
Broadhead was elected to the Board of Directors in 1989 and is a member of the Audit stock
Committee and the Strategic Planning Committee. He has served in his present position
since January 1989. Mr. Broadhead is a director of FPL Group, Inc. (a diversified
holding company whose interests include Florida Power & Light Company and companies
engaged in non-utility power generation and citrus production) and its subsidiary,
Florida Power & Light Company, as well as Delta Air Lines, Inc. and The Pittston
Company.
THOMPSON L. RANKIN, 56, President and Chief Executive Officer of Lykes Bros. Inc. and 1,248,161 shares of common stock
subsidiary companies. Mr. Rankin was elected to the Board of Directors in 1993 and is a (6)(7)
member of the Executive Compensation and Management Development Committee and the
Strategic Planning Committee. He has served as President of Lykes Bros. Inc. (an
agribusiness, and juice and beverage company) since 1983, as Chairman, President and
Chief Executive Officer since 1989 and as President and Chief Executive Officer since
1996. In addition, he serves as Chairman and Chief Executive Officer of Shore
Management, Inc. and Lykes Energy, Inc. He is a director of Lykes Bros. Inc., Shore
Management, Inc. and Lykes Energy, Inc.
</TABLE>
4
<PAGE>
<TABLE>
<S> <C>
FREDERICK H. SCHULTZ, 68, Owner of Schultz Investments. Mr. Schultz was first elected a 178,706 shares of common stock (8)
director of the Company in 1968, serving until 1979 when he resigned to become Vice
Chairman of the Board of Governors of the Federal Reserve System. He was re-elected to
the Board of Directors of the Company in 1982 following the expiration of his term at
the Federal Reserve. He is Chairman of the Audit Committee and a member of the Executive
Committee. He has been the owner of Schultz Investments (a private investment firm)
since 1957. Mr. Schultz is a director of American Heritage Life Insurance Company,
Riverside Group Inc., Southeast Atlantic Corp. and Wickes Lumber Company.
JOHN A. WILLIAMS, 54, Chairman of Post Properties, Inc. Mr. Williams was elected to the 72,519 shares of common
Board of Directors in 1987 and is Chairman of the Strategic Planning Committee and a stock
member of the Executive Compensation and Management Development Committee and the
Executive Committee. He has been Chairman of Post Properties, Inc. (a real estate
development and management firm) since 1971. He is a director of Post Properties, Inc.
and Crawford and Company.
</TABLE>
- ------------------------
(1) Shares are held as follows: 6,876 as record-holder with sole voting and
dispositive powers, 400 jointly with his wife with shared voting and
dispositive powers and 4,000 indirectly through his wife and two children.
Mr. Criser has neither voting nor dispositive powers for the shares held
solely by his wife or by his children and disclaims beneficial ownership of
those shares. In addition, 5,000 shares are held through IRA or pension plan
accounts for Mr. Criser's benefit.
(2) Shares are held as follows: 13,772 as record-holder with sole voting and
dispositive powers and 2,000 indirectly through his wife. Dr. Critchfield
has neither voting nor dispositive powers for the shares held by his wife
and disclaims beneficial ownership of those shares.
(3) Included in beneficial ownership are shares of common stock issuable upon
the exercise of certain options exercisable immediately or within 60 days as
follows: Mr. Rice, 588,750 shares and Mr. Lastinger, 268,100 shares.
(4) Shares are held as follows: 199,384 as record owner with sole voting and
dispositive powers and 4,683 jointly with his wife with shared voting and
dispositive powers.
(5) Shares are held as follows: 9,788 as record owner with sole voting and
dispositive powers; 3,827 jointly with his wife with shared voting and
dispositive powers and 2,000 in trust under the will of H.G. Alford.
(6) Shares are held as follows: 609,897 as record-holder with sole voting and
dispositive powers, 638,044 indirectly as trustee for three family trusts
and 220 indirectly through his wife.
(7) Lykes Bros. Steamship Co., Inc., of which Thompson L. Rankin served as
Chairman, President and Chief Executive Officer until May 1996, filed for
reorganization under Chapter 11 of the federal bankruptcy laws on October
11, 1995.
(8) Shares of common stock are held as follows: 41,956 as sole record owner and
136,750 indirectly through his wife with shared voting and dispositive
powers.
5
<PAGE>
SECURITIES OWNERSHIP OF MANAGEMENT
As of December 31, 1996, all executive officers and directors of the Company
as a group, a total of 28 persons, owned beneficially 3,937,066 shares of common
stock, or 1.99 percent of the common stock outstanding. Included in such
beneficial ownership is an aggregate of 1,452,888 shares of common stock which
certain of the Company's executive officers have the right to acquire
immediately or within 60 days upon the exercise of certain options. Such total
includes shares held by officers named in the SUMMARY COMPENSATION table on Page
11 as follows: Mr. Nobles, 143,338; Mr. Newman, 106,585; Mr. Brewer, 99,962; and
Ms. Beaubouef, 32,382. In the case of each of the individuals named, the shares
of equity securities owned represent less than one percent of the class owned.
Information relating to the securities ownership of directors is shown beginning
on page 2.
SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
Section 16(a) of the Securities Exchange Act of 1934, as amended (the
"Exchange Act"), requires the Company's executive officers and directors, and
any persons owning more than 10 percent of a class of the Company's stock, to
file certain reports of ownership and changes in ownership with the Securities
and Exchange Commission ("SEC") and the New York Stock Exchange. During 1996,
the executive officers and directors of the Company filed with the SEC on a
timely basis all required reports relating to transactions involving equity
securities of the Company beneficially owned by them, except that Alvin R.
Carpenter, a director of the Company, made one late filing relating to a 1996
stock purchase and Charles E. Rice, Chairman, made one late filing relating to
1996 stock gifts. The Company has relied on the written representation of its
executive officers and directors and copies of the reports they have filed with
the SEC in providing this information.
BOARD OF DIRECTORS AND
STANDING COMMITTEES; DIRECTOR COMPENSATION
If elected, the five nominees along with the Class I and Class II Directors
will constitute the Board of Directors of the Company. During 1996, the Board
held a total of eight regular meetings and two special meetings.
The Board of Directors maintains five standing committees: Audit, Corporate
Responsibility, Executive Compensation and Management Development, Strategic
Planning and Executive, which are described below. Members of these committees
are elected annually at the Board meeting immediately following the Annual
Meeting of Shareholders. Under the Company's Bylaws, the Board of Directors is
authorized to designate other members of the Board to serve in the place of
absent members of any committee. The Board of Directors does not have a
nominating committee, although the Corporate Responsibility Committee reviews
the qualifications of prospective nominees and makes recommendations to the
Board of Directors on nominees to fill new or vacant Board seats.
The Audit Committee comprises Messrs. Schultz (Chairman), Alford and
Broadhead and Dr. Bornstein, none of whom is an officer of the Company. During
1996, this committee held six meetings. The principal responsibilities of the
Audit Committee are: (1) approval of the accounting firm to be employed by the
Company as its independent auditor; (2) approval of the selection, compensation
and termination of the Company's General Auditor and the Senior Vice President
of Credit Quality; (3) consultation with internal auditors and the independent
public accountants with regard to the audit plan; (4) determination that no
restrictions are placed by management on the scope or implementation of either
the internal auditors' or independent public accountants' examination of the
Company; (5) review of the Company's credit quality review function, the methods
used to test loan quality and the adequacy of the Company's allowance for loan
losses; (6) consultation with the internal auditors and the Company's
independent public accountants with respect to the adequacy of internal
accounting controls; (7) review of new or proposed accounting standards which
affect the banking industry and their impact on the Company; (8) review with
management, the General Auditor, and the independent public accountants, of the
basis for
6
<PAGE>
the reports issued under Section 363.2 of the FDIC Improvement Act of 1991; (9)
review of the adequacy of the Company's Investments and Asset/Liability
Management policies and results for compliance; and (10) consultation with the
General Counsel and outside counsel when appropriate, to discuss legal matters
that may have a significant impact on the Company.
The Corporate Responsibility Committee comprises Messrs. Turley (Chairman),
Carpenter, Criser and McKee and Mrs. Diaz Oliver. The Corporate Responsibility
Committee held five meetings during 1996. The Corporate Responsibility Committee
is responsible for addressing issues of public policy and social responsibility
which affect the interests and welfare of the Company and its shareholders,
employees, customers and other constituents, and the communities in which they
operate. The principal responsibilities of the Committee are: (1) equal
employment opportunity, including affirmative action programs and practices; (2)
community affairs activities; (3) charitable contributions and contributions of
human services; (4) corporate governance matters affecting public
responsibility, including reviewing and recommending to the full Board of
Directors nominees to fill new or vacant Board positions; (5) the Barnett
Employee Code of Conduct and conflict of interest standards; (6) political
activities; and (7) compliance with non-financial, legal and regulatory
requirements affecting the Company's governance and operations.
The Executive Compensation and Management Development Committee comprises
Dr. Critchfield (Chairman) and Messrs. Rankin and Williams. During 1996, the
Committee held six meetings. The principal responsibilities of the Committee
are: (1) recommending the compensation arrangement of the Company's chief
executive officer to the Board of Directors; (2) approving the compensation of
certain other senior officers of the Company and its affiliates; (3) developing
and administering the Company's incentive and deferred compensation plans; (4)
periodically reviewing the Company's benefit programs; (5) serving as the Stock
Option Committee on behalf of the Board of Directors; and (6) reviewing
succession plans for key executive positions.
The Strategic Planning Committee comprises Messrs. Williams (Chairman),
Alford, Broadhead, Carpenter and Rankin. During 1996, the Strategic Planning
Committee held seven meetings. The principal responsibilities of the Strategic
Planning Committee are: (1) to review and recommend to the Board for approval
long-term business objectives and strategic plans developed by management; (2)
to review the business development activities recommended by management,
including the consistency of such activities with long-term business objectives
and strategic plans of the Company and the Company's annual strategic plan; (3)
to review, approve, or recommend to the full Board, as appropriate, strategic
decisions regarding expansion, contraction or exit from existing lines of
business and entry into lines of business that involve new strategic directions
for the Company, including acquisitions, joint ventures, or dispositions of
businesses and capital assets transactions and the financing of such
transactions; (4) to work in conjunction with management to keep the full Board
informed of the long-term business objectives and strategic plans of the Company
and critical issues associated with those objectives and plans; (5) to provide
guidance to management, as appropriate, in the development of the Company's
long-term strategic direction and business objectives; (6) to review with
management and recommend to the Board, where appropriate, changes in corporate
structure or corporate organization; (7) to provide oversight of, review and
keep informed on a timely basis with respect to the Company's corporate finance
and capital management plans; and (8) to review and, where appropriate, make
recommendations to the full Board with respect to financial plans and policy.
The Executive Committee comprises the Chief Executive Officer, who serves as
Chairman of the Committee, as well as the chairperson of each of the Board's
standing committees, currently Messrs. Schultz, Turley, Williams and Dr.
Critchfield. The Executive Committee is authorized to act on behalf of and to
exercise all of the powers of the full Board of Directors when the Board is not
in session, except as limited by the Company's Bylaws or by Florida law. The
Executive Committee did not meet during 1996.
In 1996, all members of the Board attended at least 75 percent of the
meetings of the Board and all committees on which they served.
7
<PAGE>
In November 1996, the Executive Compensation and Management Development
Committee recommended and the Board adopted certain changes to the way directors
are compensated for their services. These changes are designed to increase the
share ownership of directors, thereby further aligning the directors' interests
with those of the shareholders. Specifically, the existing Directors' Retirement
Plan was terminated and, beginning in 1997, all director retainers are paid in
Company stock.
The Directors' Retirement Plan, which provided for a cash retirement benefit
based on length of service and annual retainer, was terminated effective
December 31, 1996. The present value of any accrued benefit in the retirement
plan as of that date was credited to each director in a lump-sum amount and used
to purchase stock in the Directors' Stock Deferral Plan. The stock is reflected
in the beneficial ownership of shares attributable to each director reported
beginning on page 2.
The Directors' Stock Deferral Plan, approved by shareholders in 1994, allows
directors to receive some or all of their annual retainer and other fees in the
form of Barnett common stock held in a deferred compensation account. A
Directors' Deferral Plan allows directors to defer all or part of their fees
into a deferred income benefit account. Directors choosing the deferred income
benefit receive supplemental retirement or survivor benefits over a
five-to-twenty year period. In 1996, participation by directors in either
deferral plan was discretionary.
Non-management directors of the Company receive a monthly retainer and fees
for attendance at Board or committee meetings. For 1996, each director received
a monthly retainer of $2,000, except that each director who chaired a committee
received a monthly retainer of $2,500. Directors also received $2,000 for each
Board meeting and $1,000 for each committee meeting attended. Beginning in 1997,
the monthly retainer will be paid in stock and will increase to $2,500, except
that each director who chairs a committee will receive a monthly retainer of
$3,000. Directors may elect to receive their retainer in shares of stock
purchased through the Employee Stock Purchase Plan, or they may defer their
retainer into the Directors' Stock Deferral Plan.
To further align directors' interests with those of the shareholders, the
Company has also proposed the Performance-Based Incentive Plan which would
provide, among other things, grants for annual stock option awards to
non-management directors. Such awards would be granted at fair market value on
the date of the Company's Annual Meeting of Shareholders. The awards would carry
a term of ten years, with 50 percent of each award vesting on the third
anniversary of the grant, and an additional 25 percent of each award vesting on
the fourth and fifth anniversaries of the grant. Awards would also vest upon
death or disability of the director, upon retirement from the Board with at
least five years of service, or upon certain events resulting in a change in
control (see Proposal 2 beginning on page 18). Each director as of the 1997
Annual Meeting of Shareholders would be granted a stock option award of 5,000
shares on that date. At subsequent annual meetings, each director would receive
a stock option award of 2,000 shares, except that any new director would receive
an initial award of 5,000 shares upon election to the Board of Directors.
COMPENSATION COMMITTEE INTERLOCKS AND
INSIDER PARTICIPATION IN COMPENSATION DECISIONS
During 1996, Dr. Critchfield and Messrs. Rankin and Williams served as
members of the Board's Executive Compensation and Management Development
Committee. No member of the Committee was, or ever has been, an officer or
employee of the Company.
Dr. Critchfield and Mr. Williams, and certain companies with which Messrs.
Rankin or Williams are associated, are customers of and have banking
transactions with the Company's subsidiary or branch banks in the ordinary
course of business. As described in the section entitled CERTAIN RELATIONSHIPS
AND RELATED TRANSACTIONS on page 23, all loans were made on substantially the
same terms, including interest rates and collateral, as those prevailing at the
time for comparable transactions with other persons and, in the opinion of the
managements of the subsidiary or branch banks, did not involve more than the
normal risk of collectibility or present other unfavorable features.
8
<PAGE>
Charles E. Rice, Chairman and Chief Executive Officer of Barnett, is a
director of CSX Corporation and a member of its compensation committee. Alvin R.
Carpenter, a director of Barnett, is President and Chief Executive Officer of
CSX Transportation, Inc., and is an executive officer of CSX Corporation for
proxy reporting purposes.
REPORT OF THE EXECUTIVE COMPENSATION AND
MANAGEMENT DEVELOPMENT COMMITTEE
COMPENSATION PHILOSOPHY. The Company's Board of Directors strongly believes
that the maximization of corporate performance and, in turn, shareholder value,
depends on close alignment of the financial interests of shareholders and those
of the Company's employees, including its senior managers. Accordingly, the
Executive Compensation and Management Development Committee (the "Committee")
and the Company adhere in both principle and practice to the concept of
pay-for-performance. The Company maintains incentive compensation programs for
all managerial employees. The Company's compensation program for senior managers
is variable and closely tied to corporate, business unit and individual results.
Those programs place "at risk" a significant portion of senior manager
compensation in a manner that encourages a sharp and continuing focus on
building shareholder value.
The compensation of senior management at Barnett includes three components:
first, a base salary that reflects the scope of the executive's responsibilities
and is competitive within the financial services industry; second, an annual
cash-based incentive, closely tied to the Company's success in achieving
significant financial performance goals as set forth in advance by the
Committee; and third, a long-term incentive that links rewards to value created
for shareholders. The competitiveness of the Company's compensation programs is
evaluated by reviewing several survey sources as well as disclosed proxy
information for the top executives of other financial services institutions. The
proxy information is reviewed both for the banks that comprise the KBW 50 Total
Return Index, a stock performance index described on page 15, and for a specific
subset of 17 peer banks. The Committee meets in January of each year to review
results from the prior year, to recommend annual incentive awards for Mr. Rice
and other executives of the Company, and to recommend the salary level for Mr.
Rice for the coming year.
A more detailed discussion of how these elements of pay work together and
specific actions taken in recent years follows.
BASE SALARY. It is Barnett's compensation policy to maintain salary levels
that are competitive with those paid to senior managers with comparable
responsibilities at comparable financial institutions. Mr. Rice's 1996 salary of
$835,000 was unchanged from 1995.
ANNUAL INCENTIVE PAY--DIRECT TIE TO BUSINESS PERFORMANCE. The Company
desires to pay annual incentives that provide average rewards for average
results and to pay at or above the 75th percentile of industry norms for
outstanding results. No awards are paid if specified targets are not met.
Each year, the Committee approves annual incentive targets under the
Company's shareholder approved performance-based Annual Incentive Plan (the
"Annual Plan") for the Company's Chief Executive Officer, the five other most
highly compensated officers and all other senior managers. The Annual Plan
allows an annual incentive award of up to 200 percent of base salary for the CEO
(capped at $1,500,000), up to 160 percent of base salary for the Chief Operating
Officer, and up to 120 percent of base salary for the other named executives,
based on the Company's achievement of specific earnings-per-share results. Other
senior managers may earn incentive awards based on various business unit
measures and Company earnings-per-share goals which are established at the
beginning of the year. The Company believes that the Annual Plan complies with
the terms of the federal Revenue Reconciliation Act of 1993 covering the
deductibility of executive compensation for incentive plans.
9
<PAGE>
The Company earned $2.86 per fully diluted share in 1996. Based on these
results, which exceeded the earnings-per-share goals, the Committee granted Mr.
Rice an incentive award of $1,500,000 under the Annual Plan.
The Committee may also grant awards in recognition of contributions not
specifically related to the Company's financial performance. In 1996, the
Committee granted Mr. Rice a one-time cash award of $200,000 in recognition of
his leadership in expanding opportunities for the banking industry to sell
insurance, and in recognition of the Company's national leadership in employment
practices and advancement of women.
LONG-TERM PAY--EMPHASIS ON STOCK APPRECIATION AND OWNERSHIP. The Company's
strategy is to use stock and stock-based compensation to reward executives for
outstanding long-term results.
Stock options are awarded under the terms of the shareholder-approved
Amended and Restated 1989 Long Term Incentive Plan (the "Long Term Plan"). Any
value from stock options is directly related to the gains realized by all
shareholders over the same period. An independent consultant analyzed the
competitiveness of the Company's long-term pay plans and developed ranges of
stock option and restricted stock grants that were determined to be competitive
in the industry. Using these ranges as guidelines and in recognition of the
Company's performance, the Committee in 1996 granted Mr. Rice options to
purchase 200,000 shares of Barnett stock (adjusted for a two-for-one stock split
subsequent to the grant).
Restricted stock grants can also be made to certain key executives. These
awards are tied directly to the achievement of specific management objectives.
The shares carry either tenure requirements or performance restrictions that the
executive and the Company must achieve before the executive may own the shares.
If the tenure or performance goals (which may include return on assets, leverage
ratio and loan loss reserve targets) are not met, the number of restricted
shares that are earned can be reduced to zero. In 1994, restricted stock grants
were made to certain key executives. Fifty percent of the shares awarded carried
performance restrictions, while the remaining fifty percent of the shares
awarded vest at a rate of one-third each successive year of 1997-1999. The
Committee did not award any restricted shares in 1995 or 1996.
By providing direct links between pay and performance, the Committee is
confident that the Company's compensation programs for Mr. Rice and other
executive officers align management's interests with the annual and long-term
interests of the shareholders.
Jack B. Critchfield, Chairman
Thompson L. Rankin
John A. Williams
10
<PAGE>
EXECUTIVE PAY AND PERFORMANCE RESULTS
The SEC requires disclosure of the compensation earned by the Company's five
most highly-compensated executive officers, determined by total annual salary
and bonus for the last fiscal year. Reflecting identical salary and bonuses for
certain of the Company's executive officers, the SUMMARY COMPENSATION table
below sets forth a summary of the compensation earned by the Company's six most
highly compensated executive officers during 1996, 1995 and 1994:
SUMMARY COMPENSATION TABLE
<TABLE>
<CAPTION>
LONG-TERM COMPENSATION
-------------------------------
ANNUAL COMPENSATION AWARDS PAYOUTS
--------------------------------------------- ------------------- ----------
(A) (B) (C) (D) (E) (F) (G) (H) (I)
RESTRICTED LONG-TERM
NAME AND OTHER ANNUAL STOCK OPTIONS/ INCENTIVE ALL OTHER
PRINCIPAL POSITION YEAR SALARY($) BONUS($) COMPENSATION($) AWARDS($) SARS(#) PAYOUTS($) COMPENSATION($)
- ----------------------- ---- --------- ---------- --------------- --------- ------- ---------- ---------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Charles E. Rice 1996 $835,000 $1,700,000 $1,773,312 0 200,000 $1,847,812 $213,444
Chairman & CEO 1995 835,000 935,200 536,739 0 150,000 459,800 212,049
1994 785,000 922,500 30,683 $922,500 120,000 229,900 206,129
Allen L. Lastinger, Jr. 1996 500,000 800,000 382,490 0 100,000 923,906 90,845
President & COO 1995 500,000 420,000 538,792 0 70,000 247,600 89,638
1994 450,000 461,250 15,334 461,250 60,000 123,800 86,638
Hinton F. Nobles, Jr. 1996 300,000 360,000 57,240 0 40,000 492,750 35,585
Executive Vice 1995 300,000 201,600 2,059 0 36,000 118,400 32,278
President 1994 270,000 221,400 8,973 246,000 30,000 59,200 29,201
Charles W. Newman 1996 300,000 360,000 122,968 0 40,000 492,750 35,585
Chief Financial 1995 300,000 201,600 601 0 36,000 118,400 32,278
Officer 1994 270,000 221,400 7,670 246,000 30,000 59,200 28,151
Richard C. Brewer 1996 300,000 360,000 571,377 0 40,000 492,750 35,585
Chief Credit Policy 1995 300,000 201,600 163,748 0 30,000 108,000 32,278
Executive 1994 262,500 217,280 9,292 246,000 18,000 51,400 27,476
Judith S. Beaubouef 1996 300,000 360,000 1,259 0 40,000 492,750 35,585
Chief Legal 1995 300,000 201,600 108 0 30,000 0 27,378
Executive 1994 200,000 166,500 106 246,000 6,000 0 16,487
</TABLE>
- ------------------------
Explanation of Columns:
(c) SALARY: Total salary paid during the calendar year.
(d) BONUS: Annual incentive award paid for results achieved during the calendar
year. The REPORT OF THE EXECUTIVE COMPENSATION AND MANAGEMENT DEVELOPMENT
COMMITTEE beginning on page 9 describes the criteria for the plan under
which annual incentive awards are made. Any bonus awards deferred at the
election of the officer are included in the reported amounts. The bonus for
Mr. Rice includes a one-time award of $200,000 in recognition of his
leadership in expanding opportunities for the banking industry to sell
insurance, and in recognition of the Company's national leadership in
employment practices and advancement of women.
(e) OTHER ANNUAL COMPENSATION: Specific forms of cash and non-cash compensation
paid, awarded or earned not properly categorized as salary or bonus and
designated as Other Annual Compensation under SEC rules and regulations. The
1996 amounts include interest earned on deferred compensation that exceeds
specified market rates ($20,217 for Mr. Rice, $6,216 for Mr. Lastinger,
$4,414 for Mr. Nobles, $2,647 for Mr. Newman, $3,354 for Mr. Brewer, and
$1,259 for Ms. Beaubouef) and taxes of $89,220 paid on Mr. Rice's benefit
accrual under the Supplemental Executive Retirement Plan.
11
<PAGE>
Part of Mr. Rice's compensation is deferred under the Management Security
Plan, a non-qualified deferral plan that was introduced in 1982 and closed
to new participation in 1984. An Executive Deferral Plan was implemented in
1990 for Mr. Rice and Mr. Lastinger. The Management Deferral Plan, an
identical plan, was introduced in 1991 and made available to key employees
and executives.
The shareholder-approved Long Term Plan provides cash payments to certain
senior executives upon the exercise of non-qualified stock options. The
purpose of these payments is to encourage executives to retain their Company
stock upon exercise. Messrs. Rice, Lastinger, Nobles, Newman and Brewer
exercised stock options in 1996 which triggered tax reimbursement payments
of $1,663,875, $376,274, $52,826, $120,321 and $568,023, respectively. No
named executive officer sold any stock in 1996.
The value of all other personal benefits and perquisites received by the
named executive officers in 1996 was less than the required reporting
threshold.
(f) RESTRICTED STOCK: Stock awarded to an executive that carries certain tenure
restrictions. The restrictions on shares of restricted stock granted in 1994
expire for one-third of the shares on January 1, 1997, one-third of the
shares on January 1, 1998 and one-third of the shares on January 1, 1999.
Dividends on restricted stock are paid to the grantees. As of December 31,
1996, the total number of shares of restricted stock and the value of said
shares (based on the closing market value of $41.125 per share on said date)
outstanding for each of the persons listed above are as follows: Mr. Rice,
45,000 shares, $1,850,625; Mr. Lastinger, 22,500 shares, $925,312; Messrs.
Nobles, Newman and Brewer and Ms. Beaubouef, 12,000 shares each, $493,500
each. No restricted shares were awarded to the named executive officers in
1996.
(g) STOCK OPTIONS/SARS: Grants of stock options made during the calendar year.
These awards are made under the Company's Long Term Plan.
(h) LONG-TERM INCENTIVE PAYOUTS: Cash awards made for long-term performance in
1994 and 1995. These awards were made under the Company's Performance Unit
Plan that was initiated in 1991 and phased out in 1993. No further grants
will be made. The amounts for 1996 reflect performance-based restricted
stock vesting as a result of the achievement of certain corporate goals.
(i) ALL OTHER COMPENSATION: All other compensation which does not fall under any
of the aforementioned categories. The amounts shown in this column for 1996
comprise the following payments made by the Company: (i) Mr. Rice: $9,500
matching contribution to 401(k) plan, $156,250 premium for Executive Life
Insurance Plan, $4,614 premium for Management Security Plan, $1,276
cumulative excess interest earned on Management Security Plan deferrals,
$40,598 matching contribution to Management Excess Savings Plan, and $1,206
excess liability insurance premium; (ii) Mr. Lastinger: $9,500 matching
contribution to 401(k) plan, $59,640 premium for Executive Life Insurance
Plan, $20,499 matching contribution to Management Excess Savings Plan, and
$1,206 excess liability insurance premium; (iii) Mr. Nobles: $9,500 matching
contribution to 401(k) plan, $16,380 premium for Executive Life Insurance
Plan, $8,499 matching contribution to Management Excess Savings Plan, and
$1,206 excess liability insurance premium; (iv) Mr. Newman: $9,500 matching
contribution to 401(k) plan, $16,380 premium for Executive Life Insurance
Plan, $8,499 matching contribution to Management Excess Savings Plan, and
$1,206 excess liability insurance premium; (v) Mr. Brewer: $9,500 matching
contribution to 401(k) plan, $16,380 premium for Executive Life Insurance
Plan, $8,499 matching contribution to Management Excess Savings Plan, and
$1,206 excess liability insurance premium; and (vi) Ms. Beaubouef: $9,500
matching contribution to 401(k) plan, $16,380 premium for Executive Life
Insurance Plan, $8,499 matching contribution to Management Excess Savings
Plan, and $1,206 excess liability insurance premium.
12
<PAGE>
LONG-TERM COMPENSATION
Long-term compensation may be distinguished from annual compensation by the
time frame for which performance results are measured or the means by which the
value of the award is determined. While annual compensation covers a calendar
year, the Company's Long Term Plan covers a three-year period. As previously
described, long-term compensation includes stock options and restricted stock
granted through the Long Term Plan.
The OPTION/SAR GRANTS IN LAST FISCAL YEAR table provides the number and
hypothetical value of option grants made in 1996. The AGGREGATED OPTIONS/SAR
EXERCISES IN LAST FISCAL YEAR AND FISCAL YEAR-END OPTION/ SAR VALUES table
provides information on options exercised as well as the year-end value of stock
options held by the Company's six most highly compensated officers. Shares in
the following tables have been adjusted for a two-for-one stock split in 1996.
OPTION/SAR GRANTS IN LAST FISCAL YEAR (1)
<TABLE>
<CAPTION>
NUMBER OF
SECURITIES % OF TOTAL
UNDERLYING OPTIONS/SARS
OPTIONS/ GRANTED TO EXERCISE
SARS EMPLOYEES IN OR BASE EXPIRATION GRANT DATE
NAME GRANTED (#) FISCAL YEAR PRICE ($/SH) DATE PRESENT VALUE ($)(2)
- ----------------------- ------------ ------------ ------------ ------------- --------------------
<S> <C> <C> <C> <C> <C>
Charles E. Rice 200,000 8.6% $30.6875 Feb. 21, 2006 $ 1,337,824
Allen L. Lastinger, Jr. 100,000 4.3 30.6875 Feb. 21, 2006 668,912
Hinton F. Nobles, Jr. 40,000 1.7 30.6875 Feb. 21, 2006 267,565
Charles W. Newman 40,000 1.7 30.6875 Feb. 21, 2006 267,565
Richard C. Brewer 40,000 1.7 30.6875 Feb. 21, 2006 267,565
Judith S. Beaubouef 40,000 1.7 30.6875 Feb. 21, 2006 267,565
All Optionees 2,324,942 100.0 30.6280 15,551,816
</TABLE>
- ------------------------
(1) The Long Term Plan allows for the granting of options to certain officers
and key employees that qualify as incentive stock options under the Internal
Revenue Code of 1986, as amended ("Incentive Stock Options") and
non-qualified stock options ("Non-Qualified Stock Options"). The vesting
schedule, exercise price, term and tax reimbursement features of Incentive
Stock Options and Non-Qualified Stock Options are established under the Long
Term Plan.
(2) This estimate of value has been developed solely for purposes of comparative
disclosure in accordance with the rules and regulations of the SEC, and does
not necessarily reflect the Company's view of the appropriate value or
methodology for purposes of financial reporting.
This hypothetical value, determined by the Black-Scholes model, is based on
the following assumptions: exercise price is equal to the market value on
day of grant; estimated dividend yield of 3.29 percent; standard deviation
of stock price volatility of 0.3008; risk free rate factor of 5.37 percent;
average option term of 5 years, representing the average historical period
of time from date of grant to exercise; discount for possible cancellations
based on historical rate of 13.8 percent. These assumptions are based upon
historical experience and are not a forecast of future stock price
performance or volatility or of future dividend policy. THERE IS NO
ASSURANCE THE VALUE REALIZED BY AN EXECUTIVE WILL BE AT OR NEAR THE VALUE
ESTIMATED BY THE BLACK-SCHOLES MODEL.
The actual value of options will depend on the market value of the Company's
common stock on the dates the options are exercised. No realization of value
from the option is possible without an increase in the price of the
Company's common stock, which would benefit all shareholders.
13
<PAGE>
AGGREGATED OPTIONS/SAR EXERCISES IN LAST FISCAL YEAR
AND FISCAL YEAR-END OPTION/SAR VALUES
<TABLE>
<CAPTION>
NUMBER OF SECURITIES VALUE OF UNEXERCISED
UNDERLYING UNEXERCISED IN-THE-MONEY OPTIONS/SARS
OPTIONS/SARS AT FISCAL AT
YEAR-END (#) FISCAL YEAR-END ($)(1)(2)
SHARES ACQUIRED VALUE REALIZED --------------------------- --------------------------
NAME ON EXERCISE (#) ($)(1) EXERCISABLE UNEXERCISABLE EXERCISABLE UNEXERCISABLE
- ------------------------------------- --------------- --------------- ----------- ------------- ----------- -------------
<S> <C> <C> <C> <C> <C> <C>
Charles E. Rice...................... 131,350 $2,215,249 502,500 557,500 $12,524,062 $ 9,275,000
Allen L. Lastinger, Jr............... 45,050 820,210 223,400 285,000 5,545,600 4,772,025
Hinton F. Nobles, Jr................. 13,400 236,106 82,500 131,500 2,037,687 2,254,687
Charles W. Newman.................... 16,100 318,744 51,652 126,248 1,245,604 2,143,983
Richard C. Brewer.................... 61,550 933,594 14,504 104,846 289,861 1,712,832
Judith S. Beaubouef.................. 0 0 13,754 80,746 342,735 1,219,764
------- --------------- ----------- ------------- ----------- -------------
------- --------------- ----------- ------------- ----------- -------------
Total............................ 267,450 $4,523,903 888,310 1,285,840 $21,985,549 $ 21,378,291
</TABLE>
- ------------------------
(1) Market value of underlying securities at exercise or year-end, minus the
exercise or base price.
(2) Based on a year-end price of $41.125 per share.
14
<PAGE>
COMPARISON OF FIVE-YEAR CUMULATIVE RETURN
The SEC requires a five-year comparison of stock performance of the Company
with both a broad equity market index and a published industry index or peer
group. The Company's total return ranked against the S&P 500 and the KBW 50
Total Return Index over a five-year period is shown on the following graph. The
KBW 50 Total Return Index, developed by banking specialist Keefe, Bruyette &
Woods, Inc., is a market-capitalization-weighted bank stock index composed of 50
of the nation's most important banking companies, including all money-center and
most major regional banks, and is meant to be representative of the price
performance of the nation's large banks.
The KBW 50 Index is used by investors to access performance and by banking
companies to compare their total return performance against an industry peer
group. For the year ended December 31, 1996, Barnett's performance ranked
eleventh of the 50 banks in the index. This graph assumes that $100 was invested
on December 31, 1991 in Barnett common stock and the other indices, and that all
dividends were reinvested. The performance graph below shall not be deemed
incorporated by reference as a result of any general statement incorporating by
reference this proxy statement into any filing under the Securities Act of 1933,
as amended (the "Securities Act"), or under the Exchange Act except to the
extent that the Company specifically incorporates this information by reference,
and shall not otherwise be deemed filed under the Securities Act or the Exchange
Act.
CUMULATIVE TOTAL RETURNS FOR FIVE YEARS
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
<TABLE>
<CAPTION>
BARNETT BANK S&P 500 KBW 50 TOTAL RETURN
<S> <C> <C> <C>
1991 $100 $100 $100
1992 128 108 127
1993 133 118 134
1994 127 120 128
1995 203 165 204
1996 292 203 289
</TABLE>
15
<PAGE>
RETIREMENT PLANS
The Company and its subsidiaries maintain a non-contributory, defined
benefit retirement plan (the "Qualified Plan") for all employees meeting
specified age and length-of-service requirements. Under the Qualified Plan,
eligible employees are entitled to receive at their normal retirement date (the
later of age 65 or the fifth anniversary of employment), a monthly income
payable for life with optional forms of payment available. The formula used to
calculate the benefit is based on final average monthly compensation and length
of service. Certain minimum pension and death benefits are also provided.
Vesting of benefits occurs after five years of service.
Compensation for purposes of the Qualified Plan includes salary and bonus as
shown in columns (c) and (d) of the SUMMARY COMPENSATION table. Compensation
under the Qualified Plan was limited to $150,000 during 1996 under Section
401(a)(17) of the Internal Revenue Code of 1986, as amended (the "Code"); all
executive officers listed in the SUMMARY COMPENSATION table on page 11 were
affected by this limit in 1996.
Additionally, the Company and its subsidiaries maintain a non-contributory
defined benefit pension plan (the "Supplemental Executive Retirement Plan" or
the "SERP") for certain senior officers. This plan, which was adopted in August
1984, restores benefits lost by limitations enacted as part of the Employee
Retirement Income Security Act of 1974 ("ERISA") and further reduced by the Tax
Equity and Fiscal Responsibility Act of 1982 and the Tax Reform Act of 1986.
Without the SERP, the maximum annual amount payable in 1996 to any participant
under the Company's Qualified Plan would be the lesser of $120,000 or the
average of the participant's highest five years of compensation. The SERP also
provides for a minimum benefit from Social Security, the Company's defined
benefit pension plan and a prior employee pension plan, which is equal to the
applicable percentage in the SERP document of the two-year average base salary
and annual incentive pay in the case of disability or retirement and 40 percent
of the applicable two-year average base salary and annual incentive pay in the
event of death.
Compensation for purposes of the Supplemental Executive Retirement Plan
includes salary and bonus as shown in columns (c) and (d) of the SUMMARY
COMPENSATION table, including salary and bonus deferred at the election of an
executive officer under the Company's 401(k) and Management Excess Savings
plans, the Executive and Management Deferral Plans, and the contributory
Management Security Plan, but does not include salary and bonus deferred under
other arrangements.
Because the computations are made on an actuarial basis, amounts contributed
or expensed annually under these plans for the benefit of individual employees
are not and cannot readily be calculated separately or individually with
precision. The following table shows the estimated annual benefits payable under
the plans upon retirement to persons in a range of salary and years-of-service
classifications.
16
<PAGE>
ANNUAL BENEFIT AT NORMAL RETIREMENT (1)(2)
(DOLLARS IN THOUSANDS)
<TABLE>
<CAPTION>
YEARS OF SERVICE
REMUNERATION -----------------------------------------------
35 ------ 15 20 25
------------- --------- ----------
30
--
------------------------------
$ 125 $ 42.2 $ 56.3 $ 70.3 $ 76.6 $ 82.8
<S> <C> <C> <C> <C>
200 67.5 90.0 112.5 122.5 132.5
300 101.3 135.0 168.8 183.8 198.8
400 135.0 180.0 225.0 245.0 265.0
500 168.8 225.0 281.3 306.3 331.3
750 253.1 337.5 421.9 459.4 496.7
1,000 337.5 450.0 562.5 612.5 662.5
1,250 421.9 562.5 703.1 765.6 826.1
1,500 506.3 675.0 843.8 918.8 993.8
1,750 590.6 787.5 964.4 1,071.9 1,159.4
2,000 675.0 900.0 1,125.0 1,225.0 1,325.0
2,250 759.4 1,012.5 1,265.6 1,376.1 1,490.6
2,500 843.8 1,125.0 1,406.3 1,531.3 1,656.3
</TABLE>
- ------------------------
(1) Amounts shown in this table include amounts payable by the Supplemental
Executive Retirement Plan under the restoration formula for participants as
of February 15, 1990. This restoration formula provides a benefit which
restores retirement plan benefits lost due to benefit and earnings
limitations as well as plan changes mandated by the Tax Reform Act of 1986.
(2) All benefits are subject to an offset equal to 2 percent of primary Social
Security multiplied by the years of service (maximum of 25).
As of December 31, 1996, the credited years of service and annual
compensation covered under the Company's retirement plans for the executive
officers named in the SUMMARY COMPENSATION table on page 11 were as follows: Mr.
Rice, 32 years, $2,535,000; Mr. Lastinger, 26 years, $1,300,000; Mr. Nobles, 23
years, $660,000; Mr. Newman, 14 years, $660,000; Mr. Brewer, 26 years, $660,000;
and Ms. Beaubouef, 9 years, $660,000.
EMPLOYMENT AGREEMENTS
Believing that the continued services and contributions of certain key
executives are in the best interests of the Company's shareholders and are
essential to the Company's continued well-being, the Company has entered into
employment agreements with Messrs. Rice, Lastinger, Nobles, Newman and Brewer,
and Ms. Beaubouef, to provide certain benefits in the event of their termination
or demotion (other than for cause, as defined), during the specified period
following a change of control in the management of the Company.
The agreements provide for a lump sum distribution of three years' (for
Messrs. Rice and Lastinger) or two years' (for Messrs. Nobles, Newman and Brewer
and Ms. Beaubouef) compensation. Compensation is measured by determining the
highest base salary plus the highest incentive compensation of the affected
officer for the three-year period preceding termination of employment. During
the applicable period, the Company will continue to provide life, health and
disability insurance (or coverage comparable to that provided by the Company),
such benefits to be offset by those provided by any new employer. Each executive
will be credited with years of actual service to the Company, plus the number of
years covered by the employment contract for purposes of computing pension plan
benefits. Finally, each of the agreements provides that the amounts to be
received by the executives will be increased by an amount necessary to reimburse
them for any taxes resulting from such payments.
17
<PAGE>
PROPOSAL 2: APPROVAL OF THE PERFORMANCE-BASED INCENTIVE PLAN OF
BARNETT BANKS, INC.
At the Annual Meeting, shareholders will be asked to consider and vote on
the Performance-Based Incentive Plan (the "Plan"), which combines features of
the Company's Amended and Restated 1989 Long Term Incentive Plan and the
Company's Annual Incentive Plan, and which, if approved, will replace both of
these plans. The Plan establishes the types of objectives used to measure and
compensate for annual and long-term performance. The Plan also allows for the
reservation for future issuance of a total of 8.5 million shares of common
stock, of which no more than 1.5 million shares may be used for restricted stock
awards. The Plan is designed to motivate senior management, key employees and
directors to continue their efforts to improve the success and the growth of the
Company and to encourage senior management, key employees and directors to
remain with the Company.
The Plan will provide for the grant of incentive and non-qualified stock
options, stock appreciation rights ("SARs"), performance units and/or restricted
stock to key employees of the Company and its subsidiaries, and non-qualified
stock options to the Company's non-management directors. Additionally, the Plan
will provide for performance-based annual cash incentive awards to the Company's
senior management, including the Company's Chief Executive Officer and the other
named executive officers.
The Plan will comply with the final Treasury Regulations relating to
deductibility of executive compensation paid to the named executive officers
under Section 162(m) of the Code, which were released in final form subsequent
to approval of the Amended and Restated 1989 Long Term Incentive Plan and Annual
Incentive Plan by the shareholders in 1994. Deductibility under the Code of
executive compensation would be limited to $1 million for any named executive
officer, unless such compensation is based on the attainment, as certified by a
committee of two or more outside directors, of specified performance goals
established in advance by such committee and paid pursuant to a plan approved by
the shareholders.
The Board of Directors of the Company may amend or terminate the Plan at any
time. However, certain amendments may not be adopted without the approval of the
shareholders, including any amendment that would increase the total number of
shares issuable under the Plan, alter the class of eligible employees or
increase the total award payable to the Chief Executive Officer.
The following is a summary of certain provisions of the Plan, a copy of
which is attached as Appendix A to this proxy statement. The summary set forth
below does not purport to be complete and is qualified in its entirety by
reference to provisions of the Plan.
ANNUAL INCENTIVE COMPONENT
The Company has long adhered to the principle of pay-for-performance. The
annual incentive component of the Plan is an integral part of the Company's
compensation program, tying annual cash incentive awards for named executive
officers to the achievement of specific financial goals. Other senior management
is also eligible to participate in the annual incentive component of the Plan,
but with accountability for various business unit measures such as earnings,
return on equity, overhead ratio, asset quality, product sales and specific
individual objectives, as well as Company financial goals.
The annual incentive component of the Plan is administered by the Executive
Compensation and Management Development Committee (the "Committee"), which
currently consists of three outside directors, none of whom has ever been an
employee of the Company or any subsidiary. The Committee establishes written
financial goals for the named executive officers at the beginning of each year.
These goals are objective, with threshold, target and maximum performance
levels, and corresponding award payouts. Goals are based on the Company's
business plan approved by the Board of Directors. Before any payout can occur,
the Committee must certify that the established goals were satisfied. The
maximum annual incentive is set at 200 percent of salary for each position, in
no event to exceed $3 million.
18
<PAGE>
LONG-TERM INCENTIVE COMPONENT
The long-term incentive component of the Plan provides for the grant of
incentive and non-qualified stock options, SARs, performance units and/or
restricted stock to key employees of the Company and its subsidiaries, and
non-qualified stock options to the Company's non-management directors, as
specifically described below. If the Plan is approved, a total of 8.5 million
shares of common stock, of which no more than 1.5 million shares may be used for
restricted stock awards, will be reserved for issuance. That number is subject
to possible adjustment for stock dividends, stock splits and other changes in
the Company's capitalization and corporate structure. The maximum number of
shares of common stock or common stock equivalents that may be subject to an
award under the Plan to any eligible participant may not exceed 2 million shares
over any period of three consecutive fiscal years of the Company. The common
stock subject to the Plan may be authorized but unissued shares or shares
purchased or otherwise acquired by the Company for use in the Plan, as
determined from time to time by the Committee.
The long-term incentive component of the Plan is administered by the
Committee. Subject to the provisions of the Plan and the approval of the Board
of Directors, the Committee determines which key employees, if any, will be
granted awards, and the type, amount and timing of the awards. Awards granted by
the Committee may consist of incentive stock options, non-qualified stock
options, restricted stock, SARs which may be payable in cash or the Company's
common stock, performance units or any combination of the above. Awards of
non-qualified stock options to non-management directors are not discretionary.
Currently, the Company does not award SARs or performance units. The Company's
award strategy consists of stock options and the limited use of restricted
stock.
All stock options and SARs will become fully exercisable, all performance
units will be payable, and all restrictions on restricted stock awards will
expire upon the occurrence of the Acceleration Events described in Appendix A.
Stock options, SARs, restricted stock awards and performance units granted
under the Plan are non-transferable except by gift to certain immediate family
members and with approval of the Committee, by will, by the laws of descent and
distribution, or by a qualified domestic relations order (a "QDRO") as defined
by the Code or ERISA, and during the grantee's lifetime may only be exercised by
the grantee or by the guardian or legal representative of such grantee or
pursuant to a QDRO. In addition, stock options and SARs are only exercisable,
restricted stock awards are only earned and performance units are only payable
while the grantee is an employee or director, as applicable, of the Company, or,
for stock options and SARs, within three or twelve months of the date of
termination of employment depending on the reason for termination. Except for
awards to non-management directors, the exercise period for stock options and
SARs may be extended by the Committee. The extension period may not exceed 60
months following termination. Restricted stock awards and performance units are
earned on a pro-rata basis if termination occurs due to death, disability or
retirement before certain financial objectives are met, and immediately if only
length of service objectives must still be met by the participant.
For grants to participants other than non-management directors, and subject
to the terms of the Plan, the Committee has discretion to accept the surrender
of or modify outstanding awards and grant new awards in substitution for them,
provided that the modification does not adversely alter or impair any rights or
obligations without the participant's consent and does not constitute
"repricing" as such term is defined in 17 CFR 229.402(i)(1).
The Plan permits participants to elect to pay their taxes due upon the
exercise of options or SARs or upon the vesting of restricted stock awards
through the withholding of a portion of the shares issuable with a fair market
value equal to the taxes due. In connection with any grant or exercise of an
award, the Plan also permits the Committee to provide for a supplemental cash
payment to participants, excluding non-management directors. Any such payment
may not be greater than the lesser of: (a) the difference between the option
price and the fair market value of the underlying shares on the date the option
is exercised (the "spread"); or (b) the spread multiplied by the ratio of the
maximum federal income tax rate payable by an
19
<PAGE>
employee on the spread to 50 percent (except that, with respect to restricted
stock, SARs or performance units, the spread shall be the difference between the
amount paid for the restricted stock, SAR or performance unit, as applicable,
and the fair market value of the common stock (or cash) distributed).
STOCK OPTIONS. Incentive stock options and non-qualified stock options
(collectively "Stock Options") granted under the Plan must be granted at a per
share option price at least equal to the fair market value per share of the
common stock on the date of grant. The option price may be paid in cash, in
shares of common stock or through the surrender of Stock Options or SARs, or,
for non-qualified stock options, other contingent awards determined to be
consistent with Plan purposes and applicable law, as specified by the Committee
at the time of the grant.
The term of any Stock Option may not exceed ten years. The Committee retains
the right to establish vesting schedules for each award. It is anticipated that
Stock Options will become exercisable as under the predecessor plan, with 50
percent of the total number of shares covered by the Stock Option becoming
exercisable on the third anniversary of the date the Stock Option is granted,
and an additional 25 percent of the shares becoming exercisable on each of the
fourth and fifth anniversaries of the grant, unless the Committee specifies
otherwise at the time of grant.
Incentive stock options granted under the Plan are entitled to special tax
treatment under Section 422 of the Code. The grant of an incentive stock option
will not result in taxable income to the optionee or an income tax deduction for
the Company either at the time of grant or at the time of exercise. However,
when an optionee exercises an incentive stock option, he or she must generally
include as alternative minimum taxable income in the year of exercise the
difference between the fair market value of the shares on the date of the
exercise and the option price. If the optionee does not dispose of the shares of
common stock received upon exercise of incentive stock options within two years
after the incentive stock option is granted and holds the shares at least one
year after exercise, he or she will realize long-term capital gain or loss on
the sale of such shares, and the Company will not be entitled to an income tax
deduction. Otherwise, the optionee must report in the year of disposition the
difference between the fair market value of the shares on the date of exercise
(or the amount realized, if less) and the option price as ordinary income. Any
gain realized on the disposition in excess of the amount treated as ordinary
income will be treated as a capital gain. The Company will be allowed a federal
income tax deduction equal to the ordinary income, if any, recognized by the
optionee.
Non-qualified stock options granted under the Plan are not entitled to
special tax treatment under Section 422 of the Code. The grant of a
non-qualified stock option will not result in taxable income to the optionee or
an income tax deduction to the Company at the time of grant. An optionee who
exercises a non-qualified stock option will generally recognize ordinary income
in the year of exercise in an amount equal to the difference between the fair
market value of the shares at the time of exercise and the option price. The
Company is permitted an income tax deduction equal to the amount of ordinary
income the optionee is required to recognize as a result of the exercise of a
non-qualified stock option.
Each active non-management director will receive an initial option to
purchase 5,000 shares of Company stock at the director's first Board of
Directors meeting after election as a director, or, for current directors, on
the date of approval of the Plan. Active non-management directors will also
receive an option to purchase 2,000 shares of Company stock at each subsequent
Annual Meeting of Shareholders.
RESTRICTED STOCK AWARDS. Under the Plan, the Committee may also grant
restricted stock awards to key employees under stock agreements imposing sale,
transfer or encumbrance restrictions for a specified period of time, or such
other restrictions as the Committee may determine, including forfeiture
provisions in the event the participant's employment terminates before a certain
date. Restricted stock awards will be earned by an employee as certain
management objectives established at the time of grant (the "Management
Objectives") are met. The Management Objectives may be the participant's length
of service and/or specified levels of earnings, return on assets, leverage
ratio, earnings-per-share, overhead ratio, loan loss reserve ratio, or return on
equity achieved by the Company or the subsidiary, department or function of the
20
<PAGE>
Company in which the participant is employed, whether in relation to the
Company's business plan or as against an industry peer group. If the
participant's employment terminates prior to the end of the performance period
and the Committee determines that the applicable Management Objectives have been
met, the participant will be deemed to have earned a pro-rata portion of the
award based on the number of months employed compared to the number of months in
the performance period.
The grant of restricted stock awards will not result in taxable income to
the participant or an income tax deduction for the Company until the restricted
stock is transferable or is not subject to a substantial risk of forfeiture.
When the restricted stock becomes transferable or is no longer subject to a
substantial risk of forfeiture, the participant will report as ordinary income
and the Company will be allowed an income tax deduction equal to the fair market
value of the stock at that time.
Except for restrictions upon the sale, transfer or encumbrance of shares,
the recipient of a restricted stock award will have all other rights of a holder
of common stock, including dividend rights and voting rights, except that the
recipient will have no voting rights until Management Objectives, other than
length of service, have been met. Dividends payable on restricted stock awards
subject to Management Objectives other than length of service will be
accumulated but not paid to a participant until such Management Objectives are
met. If a share of restricted stock subject to Management Objectives other than
length of service is forfeited, accumulated dividends on this share of
restricted stock will also be forfeited by the participant and will revert to
the Company.
STOCK APPRECIATION RIGHTS. The Plan will permit the Committee to award SARs
to participants. The exercisability, vesting, duration and other terms and
conditions of SARs shall be determined by the Committee, but in no event may the
term of a SAR exceed ten years. No SAR may be exercised until six months have
elapsed since the date of grant, unless the death or disability of a participant
occurs within such six month period. Upon exercise of a SAR, a participant shall
receive an amount determined by multiplying: (a) the excess of the fair market
value of a share of the Company's common stock on the date preceding the date of
exercise of such SAR over the per share exercise price of any Stock Option
granted in connection with the SAR by (b) the number of shares of common stock
as to which the SAR is being exercised. The Committee has discretion to
determine whether a SAR is payable in common stock, cash or a combination of
both.
PERFORMANCE UNITS. The Plan will give the Committee discretion to award
performance units to participants. Each performance unit has a cash value equal
to the fair market value of one share of the Company's common stock. The
Committee has discretion to determine the terms and conditions of a performance
unit award, including the number of performance units granted to a participant
and the Management Objectives as defined above which must be achieved by the
participant before the performance unit is payable. During the performance
period, a participant may have the right to receive amounts equal to dividends
paid on the Company's common stock as determined by the Committee at the time of
the grant. Upon the expiration of the applicable performance period and the
Committee's determination that the Management Objectives have been met, the
Company shall distribute cash to the participant equal to the fair market value
of one share of the Company's common stock on the date of distribution
multiplied by the number of performance units earned. If the participant's
employment terminates prior to the end of the performance period and the
Committee determines that the applicable Management Objectives have been met,
the participant will be deemed to have earned a pro-rata portion of the award
based on the number of months employed compared to the number of months in the
performance period.
The Board of Directors believes that the Plan will give the Company
flexibility to motivate, reward and retain key employees, senior management and
directors who contribute to the Company's annual and long-term success in
building shareholder value. Shareholder approval will also allow for the
deductibility by the Company of performance-based compensation paid under the
Plan to the named executive officers.
* * *
21
<PAGE>
In order to be approved, and in order to qualify as a performance-based plan
under the IRS regulations, the Plan must receive the affirmative vote of a
majority of the votes cast on the issue at the Annual Meeting of Shareholders,
provided that a quorum is present. Votes shall be counted as described in VOTING
PROCEDURES on page 1. Proxies solicited by the Board will be voted for approval
of the Plan, unless shareholders specify a contrary choice in their proxies.
THE BOARD OF DIRECTORS OF THE COMPANY RECOMMENDS A VOTE "FOR" APPROVAL OF
THE COMPANY'S PERFORMANCE-BASED INCENTIVE PLAN.
22
<PAGE>
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
Certain directors and officers of the Company and companies with which they
are associated are customers of and have banking transactions with the Company's
subsidiary banks in the ordinary course of business. All such transactions
involving loans and loan commitments to officers or directors or companies with
which they are associated have been made on substantially the same terms,
including interest rates and collateral, as those prevailing at the time for
comparable transactions with other persons and, in the opinion of managements of
the subsidiary banks, have not involved more than the normal risk of
collectibility or presented other unfavorable features.
The law firm of Mahoney Adams & Criser, P.A., of which Marshall M. Criser is
a member, has rendered legal services to the Company and certain of its
subsidiaries, for which it received approximately $1.7 million in 1996. This
amount does not include fees paid by customers of subsidiaries.
INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS
The firm of Arthur Andersen LLP served as the independent accountants for
the Company for the fiscal year ending December 31, 1996. Representatives of
Arthur Andersen LLP will be present at the Annual Meeting of Shareholders to
respond to appropriate questions.
OTHER MATTERS
The Board of Directors does not know of any other matters to come before the
meeting. However, if any other matters properly come before the meeting, it is
the intention of the persons designated as proxies to vote in accordance with
their best judgment on such matters.
SHAREHOLDER PROPOSALS
Shareholders who wish a proposal to be included in the Company's proxy
statement and form of proxy relating to the 1998 Annual Meeting of Shareholders
should deliver a written copy of their proposal to the principal executive
offices of the Company no later than October 30, 1997. Proposals should be
directed to Catherine C. Cosby, Corporate Secretary, Barnett Banks, Inc., Post
Office Box 40789, Jacksonville, Florida 32203-0789. Proposals must comply with
the SEC proxy rules relating to shareholder proposals in order to be included in
the Company's proxy materials.
ANNUAL REPORT; FORM 10-K
A copy of the Company's Annual Report to Shareholders for the fiscal year
ended December 31, 1996 is being provided to each shareholder with delivery of
this proxy statement. Additional copies of the Annual Report to Shareholders or
copies of the Company's Annual Report on Form 10-K, filed with the SEC, may be
obtained by writing to the Corporate Communications Department of the Company,
P. O. Box 40789, Jacksonville, Florida 32203-0789.
COST OF SOLICITATION
The cost of solicitation of proxies will be borne by the Company, including
expenses in connection with the preparation and mailing of this proxy statement.
The Company has retained Georgeson & Company, Inc., a proxy solicitation firm,
to assist in the solicitation of proxies at a cost of approximately $5,000 plus
reimbursement of out-of-pocket expenses. In addition, the Company will reimburse
brokers and nominees their reasonable expenses for sending proxy material to
principals and obtaining their proxies. In addition to solicitation by mail,
proxies may be solicited in person or by telephone or electronic transmission by
directors, officers, and other employees of the Company.
Dated: February 28, 1997
SHAREHOLDERS ARE URGED TO SPECIFY THEIR CHOICE, DATE, SIGN AND RETURN THE
PROXY IN THE ENCLOSED POSTAGE-PAID ENVELOPE. YOUR PROMPT RESPONSE IS
APPRECIATED.
23
<PAGE>
APPENDIX A
PERFORMANCE-BASED INCENTIVE PLAN
OF
BARNETT BANKS, INC.
I. GENERAL
1.1 PURPOSE OF THE PLAN
The 1997 Performance-Based Incentive Plan (the "Plan") of Barnett Banks,
Inc. (the "Company") is intended to advance the best interests of the Company
and its subsidiaries by providing annual and long-term incentives to senior
management and key employees who have substantial responsibility for corporate
management and growth. Specifically, the annual incentive component of the Plan
provides for performance-based cash incentive awards to senior management and
the long-term incentive component of the Plan provides for performance-based
incentive awards to key employees through the grant of options to purchase
shares of common stock, $2.00 par value, of the Company (the "Common Stock"),
restricted stock, stock appreciation rights and performance units, thereby
increasing the personal stake of participants in both the annual and long-term
success and growth of the Company and encouraging them to remain in the employ
of the Company. In addition, the long-term incentive component of the Plan
provides for performance-based incentive awards to non-employee members of the
Board of Directors ("Directors") through the grant of options to purchase Common
Stock.
1.2 ADMINISTRATION OF THE PLAN
The Plan shall be administered by the Executive Compensation and Management
Development Committee or other designated committee (the "Committee") of the
Board of Directors of the Company which shall consist solely of two or more
directors meeting the definition of outside directors under Treas. Reg. Section
1.162-27(e)(3).
The Committee shall have full and final authority in its discretion to
interpret conclusively the provisions of the Plan as it may deem advisable, to
adopt such rules and regulations for carrying out the Plan as it may deem
advisable; to decide all questions of fact arising in the application of the
Plan; and to make all other determinations necessary or advisable for the
administration of the Plan.
The Committee shall meet once each fiscal year, and at such additional times
as it may determine or at the request of the chief executive officer of the
Company, to designate the eligible participants, if any, to be granted awards
under the Plan and the type and amount of such awards and the time when such
awards will be granted. No such designation by the Committee shall be effective
as a grant of an award under the Plan until approved by the Board of Directors
of the Company; provided, however, that the Board of Directors may empower the
Committee to grant such awards without approval by the Board of Directors.
Awards of stock options to Directors under the long-term incentive component of
the Plan are not discretionary. All awards granted under the Plan shall be on
the terms and subject to the conditions hereinafter provided.
1.3 ELIGIBLE PARTICIPANTS
Officers and senior management of the Company and its subsidiaries shall be
eligible to participate in the annual incentive component of the Plan. Key
employees, including officers and senior management of the Company and its
subsidiaries, shall be eligible to participate in the long-term incentive
component of the Plan. Any recipient of an award under this Plan is hereinafter
referred to as a "Participant". Directors who are not employees of the Company
or its subsidiaries are eligible to participate in the Plan only to the extent
and in the manner described in Section 7.5 below.
A-1
<PAGE>
1.4 ANNUAL INCENTIVE COMPONENT
The Committee establishes written, objective financial goals for the
executive officers named in the Summary Compensation Table of the Company's
proxy statement (the "Named Executive Officers") at the beginning of each year.
Financial goals for the Named Executive Officers may include Company earnings-
per-share ("EPS"), return on equity, overhead ratio, asset quality and product
sales. Goals include threshold, target and maximum performance levels and
corresponding award payouts. Goals are based on the Company's business plan as
approved by the Board of Directors of the Company. Before any payout can occur,
the Committee must certify that performance goals were satisfied. Senior
management is also eligible to participate in the annual incentive component of
the Plan, but with accountability for various business unit measures such as
earnings, return on equity, overhead ratio, asset quality and product sales and
specific individual objectives, as well as Company financial goals.
The maximum annual incentive is set at 200 percent of salary for each
position, in no event to exceed $3 million. Awards under the annual incentive
component are in the form of cash.
1.5 AWARDS UNDER LONG-TERM INCENTIVE COMPONENT
Awards under the long-term incentive component of the Plan may be in the
form of Incentive Stock Options (as described in Article II), Non-Qualified
Stock Options (as described in Article III), Restricted Stock (as described in
Article IV), Stock Appreciation Rights (as described in Article V), Performance
Units (as described in Article VI) or any combination thereof. Awards to
Directors may only be in the form of Non-Qualified Stock Options (as described
in Article III).
1.6 LIMITATION ON AWARDS UNDER LONG-TERM INCENTIVE COMPONENT
The aggregate number of shares of Common Stock and restricted stock,
including but not limited to shares reserved for issuance pursuant to the
exercise of options, which may be granted or issued under the terms of the Plan
may not exceed 8.5 million shares. Of this aggregate limit, the aggregate number
of shares of restricted stock which may be granted or issued under the terms of
the Plan may not exceed 1.5 million shares. The maximum number of shares of
Common Stock that may be subject to grants under the long-term incentive
component of the Plan to a Participant may not exceed 2 million shares of Common
Stock over any period of three (3) consecutive fiscal years of the Company.
Whenever any outstanding grant or portion thereof expires, is canceled or
forfeited or is otherwise terminated for any reason without having been
exercised or vested, or without payment having been made in respect of the
entire grant, the Common Stock allocable to the expired, forfeited, canceled or
otherwise terminated portion of the grant may again be the subject of further
grants hereunder.
Notwithstanding the foregoing, the number of shares of Common Stock
available for grants at any time under the Plan shall be reduced to such lesser
amount as may be required pursuant to the methods of calculation necessary so
that the exemptions provided pursuant to Rule 16b-3 under the Exchange Act will
continue to be available for transactions involving all current and future
grants. In addition, during the period that any grants remain outstanding under
the Plan, the Committee may make good faith adjustments with respect to the
number of shares of Common Stock attributable to such grants for purposes of
calculating the maximum number of shares of Common Stock available for the
granting of future grants under the Plan, provided that following such
adjustments the exemptions provided pursuant to Rule 16b-3 under the Exchange
Act will continue to be available for transactions involving all current and
future grants.
1.7 OTHER COMPENSATION PROGRAMS
The adoption of the Plan contemplates the continuation of all existing
incentive compensation plans of the Company, except the Amended and Restated
1989 Long Term Incentive Plan and the Annual Incentive Plan, which were
discontinued upon approval of the Plan by the Company's shareholders, and in no
way limits or is limited by the operation, administration or amendment of any
such plans. The existence and terms of the Plan shall not limit the authority of
the Board of Directors in compensating employees of the Company in such other
forms and amounts as it may determine from time to time.
A-2
<PAGE>
II. INCENTIVE STOCK OPTIONS
2.1 TERMS AND CONDITIONS
Subject to the following provisions in this Article II, all Incentive Stock
Options shall be in such form and upon such terms and conditions as the
Committee, in its discretion, may from time to time determine and shall be
awarded under the long-term incentive component of the Plan.
2.2 QUALIFIED STOCK OPTIONS
Incentive Stock Options shall, at the time of grant, be in such form and
upon such terms and conditions as may be required in order that such options
will constitute Incentive Stock Options within the meaning of Section 422 of the
Internal Revenue Code of 1986, as amended (the "Code").
2.3 OPTION PRICE
The option price per share shall be at least the Fair Market Value (as
defined in section 8.13 of this Plan) of the Common Stock on the date the
Incentive Stock Option is granted.
2.4 TERM OF OPTION
The term of an Incentive Stock Option shall not exceed ten (10) years from
the date of grant.
2.5 PAYMENT
Payment for shares for which an Incentive Stock Option is exercised shall be
made in such manner and at such time or times as shall be provided by the
Committee at the time of grant, in cash, in Common Stock, including restricted
stock, through the surrender of stock options or stock appreciation rights, or
any combination thereof.
2.6 EXERCISE OF OPTION
Incentive Stock Options shall be exercisable in whole or in part after
completion of such periods of service as the Committee shall specify when
granting the options; provided, however, that in the absence of any Committee
specification to the contrary, and subject to Sections 2.7 and 2.8, (1) fifty
percent (50%) of the shares subject to the Incentive Stock Option shall become
exercisable with respect to such shares on the third anniversary of the date of
grant of the Incentive Stock Option and (2) on each of the next two
anniversaries of the date of the grant, an additional twenty five percent (25%)
of the shares subject to the Incentive Stock Option shall become exercisable
with respect to such shares.
In no event, however, and notwithstanding Sections 2.7 and 2.8, shall an
Incentive Stock Option be exercised after the expiration of ten (10) years from
the date of grant.
2.7 TERMINATION OF EMPLOYMENT
A Participant's Incentive Stock Options shall expire three months after the
termination of the Participant's employment for any reason other than death,
disability (as determined by the Committee) or retirement (under the applicable
retirement program of the Company or one of its subsidiaries or as otherwise
determined by the Committee), and shall be limited to the shares of Common Stock
which could have been purchased by the Participant at the date of termination of
employment.
2.8 TERMINATION OF EMPLOYMENT BY REASON OF DEATH, DISABILITY OR RETIREMENT
Upon the termination of a Participant's employment by reason of death,
disability (as determined by the Committee), or normal retirement (under the
applicable retirement program of the Company or one of its subsidiaries or as
otherwise determined by the Committee), Incentive Stock Options held at the
termination date by such Participant shall be exercisable, irrespective of
whether the options were fully exercisable in accordance with Section 2.6 on
that date. The Participant's Incentive Stock Options shall expire unless
exercised within one year from the date of such termination unless otherwise
established by the Committee.
In the case of termination of a Participant's employment (1) with at least
20 years of employment or (2) by reason of early retirement within the meaning
of the applicable retirement plan, Incentive Stock
A-3
<PAGE>
Options which may be exercised shall be limited to the shares which could have
been purchased by the Participant at the date of such early retirement, except
that the Committee, in its discretion, may waive the vesting requirements of
Section 2.6. The Participant's Incentive Stock Options shall expire unless
exercised within one year from the date of such termination.
Notwithstanding the foregoing, the tax treatment available pursuant to
Section 422 of the Code upon the exercise of an Incentive Stock Option will not
be available to a Participant who exercises any Incentive Stock Option more than
three months after termination of employment due to retirement, or who, in the
event of waiver of the vesting requirements upon termination with 20 years of
employment or upon early retirement, obtains the right to exercise for the first
time Incentive Stock Options having an aggregate fair market value, determined
at the date of issue, exceeding $100,000.
The Committee may, at any time on or before the termination of the exercise
period of the Participant's Incentive Stock Options, extend the exercise period
if the Participant's employment is terminated for a reason specified in this
section. If so extended, the term of the exercise period shall expire on the
date specified by the Committee, which date shall be no later than the date
which is 60 months following the date of the Participant's termination of
employment. If such extension could adversely affect the Participant's federal
income tax treatment of the Incentive Stock Option at the time of extension or
exercise, the extension shall only be made with the consent of the Participant.
In no event may the term of an Incentive Stock Option, including extensions,
exceed the term set forth in Section 2.4.
2.9 SPECIAL RULE FOR 10 PERCENT SHAREHOLDERS
If, at the time an Incentive Stock Option is granted, a Participant owns
stock representing more than 10 percent of the total combined voting power of
all classes of stock of the Company or any of its subsidiaries, then the terms
of the Incentive Stock Option shall specify that the option price shall at the
time of grant be at least 110 percent of the Fair Market Value of the stock
subject to the option and such option shall not be exercisable after the
expiration of five (5) years from the date such option is granted.
2.10 NOTICE OF DISPOSITION
If a Participant makes a disposition, within the meaning of Section 424(c)
of the Code and regulations promulgated thereunder, of a share or shares of
Common Stock issued to such Participant pursuant to the exercise of an Incentive
Stock Option within the two year period commencing on the day after the date of
the grant or within the one year period commencing on the day after the date of
transfer of such share or shares to the Participant pursuant to such exercise,
the Participant shall, within ten (10) days of such disposition, notify the
Company thereof by delivery of written notice to the Company at its principal
executive office.
2.11 ACCELERATION EVENT
Notwithstanding anything herein to the contrary, if an Acceleration Event
(as defined in Section 8.14) has occurred, then all of the shares subject to the
Incentive Stock Option shall immediately become exercisable with respect to such
shares on the date such Acceleration Event occurred.
III. NON-QUALIFIED STOCK OPTIONS
3.1 TERMS AND CONDITIONS OF OPTIONS
Subject to the following provisions, all Non-Qualified Stock Options shall
be in such form and upon such terms and conditions as the Committee, in its
discretion, may from time to time determine. Non-Qualified Stock Options shall
be awarded under the long-term incentive component of the Plan.
3.2 NON-QUALIFIED STOCK OPTIONS
The terms of a Non-Qualified Stock Option shall, at the time of grant,
provide that it will not be treated as an incentive stock option within the
meaning of Section 422 of the Code.
A-4
<PAGE>
3.3 OPTION PRICE
The option price per share shall be at least the Fair Market Value of the
Common Stock on the date the Non-Qualified Stock Option is granted.
3.4 TERM OF OPTION
The term of a Non-Qualified Stock Option shall not exceed ten (10) years
from the date of grant.
3.5 PAYMENT
Payment for shares for which a Non-Qualified Stock Option is exercised shall
be made in such manner and at such time or times as shall be provided by the
Committee at the time of grant, in cash, in Common Stock, including restricted
stock, through the surrender of stock options or stock appreciation rights, or
any combination thereof, or other contingent grants which the Committee
determines is consistent with the Plan's purposes and applicable law.
3.6 EXERCISE OF OPTION
Non-Qualified Stock Options shall be exercisable in whole or in part after
completion of such periods of service as the Committee shall specify when
granting the options; provided, however, that in the absence of any Committee
specification to the contrary, and subject to Sections 3.7 and 3.8, (1) fifty
percent (50%) of the shares subject to the Non-Qualified Stock Option shall
become exercisable with respect to such shares on the third anniversary of the
date of grant of the Non-Qualified Stock Option and (2) on each of the next two
anniversaries of the date of the grant, an additional twenty-five percent (25%)
of the shares subject to the Non-Qualified Stock Option shall become exercisable
with respect to such shares. In no event, however, and notwithstanding Sections
3.7 and 3.8, shall a Non-Qualified Stock Option be exercised after the
expiration of ten (10) years from the date of grant.
3.7 TERMINATION OF EMPLOYMENT
A Participant's Non-Qualified Stock Options shall expire three months after
the termination of the Participant's employment for any reason other than death,
disability (as determined by the Committee) or retirement (under the applicable
retirement program of the Company or one of its subsidiaries or as otherwise
determined by the Committee), and shall be limited to the shares which could
have been purchased by the Participant at the date of termination of employment.
3.8 TERMINATION OF EMPLOYMENT BY REASON OF DEATH, DISABILITY OR RETIREMENT
Upon the termination of a Participant's employment by reason of death,
disability (as determined by the Committee) or retirement (under the applicable
retirement program of the Company or one of its subsidiaries or as otherwise
determined by the Committee), Non-Qualified Stock Options held at the
termination date by such Participant shall be exercisable, irrespective of
whether the options were fully exercisable in accordance with Section 3.6 on
that date. The Participant's Non-Qualified Stock Options shall expire unless
exercised within one year from the date of such termination unless otherwise
established by the Committee.
The Committee may, at any time on or before the termination of the exercise
period of the Participant's Non-Qualified Stock Options, extend the exercise
period if the Participant's employment is terminated for a reason specified in
this section. If so extended, the term of the exercise period shall expire on
the date specified by the Committee, which date shall be no later than the date
which is 60 months following the date of the Participant's termination of
employment. In no event may the term of a Non-Qualified Stock Option, including
extensions, exceed the term set forth in Section 3.4.
3.9 ACCELERATION EVENT
Notwithstanding anything herein to the contrary, if an Acceleration Event
has occurred, then all of the shares subject to the Non-Qualified Stock Option
shall immediately become earned and the Non-Qualified Stock Option shall become
exercisable with respect to such shares on the date such Acceleration Event
occurred.
A-5
<PAGE>
IV. RESTRICTED STOCK AWARDS
4.1 RESTRICTIONS
Restricted Stock may be granted to a Participant by the Committee under a
Restricted Stock agreement. Such agreement shall specify the number of shares
granted and the conditions and terms of the restrictions. Such restrictions
shall lapse for all or part of the shares granted upon satisfaction of specified
Management Objectives (as defined below) within a specified Performance Period
(as defined below). Restricted Stock, with restrictions noted on the face of the
certificates, shall be issued in the name of the Participant and deposited with
the Company or its designee during the Performance Period. Restricted Stock
shall be awarded under the long-term incentive component of the Plan.
4.2 MANAGEMENT OBJECTIVES
Restricted Stock shall be deemed to have been earned by a Participant based
upon achievement of Management Objectives specified by the Committee at the time
of grant. Management Objectives may be the Participant's length of service
and/or specified levels of earnings, return on assets, overhead ratio,
earnings-per-share, leverage ratio, loan loss ratio, or return on equity
achieved by the Company or any subsidiary, department or function of the Company
in which the Participant is employed, whether in relation to the Company's
business plan or as against an industry peer group. Management Objectives
relating to any particular grant of Restricted Stock need not be the same as
those relating to any other grant, whether made at the same or a different time.
4.3 PERFORMANCE PERIOD
The Performance Period with respect to Restricted Stock shall be the period
of time within which the Management Objectives relating to that grant are to be
achieved. The Committee shall determine the length of the Performance Period,
which shall commence on the date of grant of Restricted Stock and shall be at
least one year.
4.4 EARNING OF RESTRICTED STOCK
The Committee shall, promptly after the date on which the necessary
financial or other information for a particular Performance Period becomes
available, determine the extent to which the restrictions on Restricted Stock
have lapsed through Participant's achievement of the relevant Management
Objectives other than length of service. Upon determination by the Committee
that relevant Management Objectives other than length of service have been
achieved, the number of shares of Restricted Stock shall be fixed and
accumulated dividends shall be paid as set forth in Section 4.5. Restricted
Stock shall not be considered earned until such time as all restrictions lapse.
4.5 RIGHTS AS SHAREHOLDER
Except as otherwise provided in this Article IV, the Participant shall have
all rights as a shareholder, including dividend rights and voting rights with
respect to the Restricted Stock. During the Performance Period and subject to
the restrictions set forth in this Article IV, a Participant has the right to
receive the dividends paid on the Common Stock at the same time and in the same
amount as other shareholders of the Company; provided, however, that any
dividends payable on Restricted Stock subject to Management Objectives other
than length of service shall be accumulated and become payable when such
Management Objectives other than length of service have been met in accordance
with Section 4.4. If the Committee determines that the Management Objectives
other than the length of service have not been met within the Performance
Period, dividends on any such unearned Restricted Stock shall revert to the
Company. Restricted Stock subject to Management Objectives other than length of
service shall have no voting rights.
4.6 TERMINATION OF EMPLOYMENT
If any Participant's employment has terminated due to the Participant's
death, disability (as determined by the Committee) or retirement (under the
applicable retirement program of the Company or one of its subsidiaries or as
otherwise determined by the Committee) prior to the end of a Performance Period,
and the Committee has determined that applicable Management Objectives other
than length of service have been
A-6
<PAGE>
achieved, the extent to which Restricted Stock shall be deemed to have been
earned shall be determined by multiplying the amount of the Restricted Stock
which would have been earned had the Participant's employment not been
terminated by a fraction, the numerator of which is the number of full calendar
months such Participant was employed during the Performance Period and the
denominator of which is the total number of full calendar months in the
Performance Period. All length of service Management Objectives shall
immediately be satisfied upon the Participant's death or disability, or upon
retirement within the meaning of the Supplemental Executive Retirement Plan
("SERP"), if applicable, or other applicable retirement plan.
4.7 ACCELERATION EVENT
Notwithstanding anything herein to the contrary, if an Acceleration Event
has occurred, then all restrictions on the Restricted Stock shall lapse on the
date such Acceleration Event occurred regardless of whether the Management
Objectives with respect to such Restricted Stock have yet been satisfied.
V. STOCK APPRECIATION RIGHTS
5.1 IN GENERAL
The Committee may, in its discretion, either alone or in connection with the
grant of an Incentive Stock Option or a Non-Qualified Stock Option (collectively
referred to in this Article V as an "Option"), grant to Participants Stock
Appreciation Rights, the terms and conditions of which shall be set forth in a
Stock Appreciation Rights agreement. If granted in connection with an Option,
Stock Appreciation Rights shall cover the same number of shares of Common Stock
covered by the Option (or such lesser number of shares of Common Stock as the
Committee may determine) and shall, except as provided in this Article V, be
subject to the same terms and conditions as the related Option. Awards of Stock
Appreciation Rights shall be made under the long-term incentive component of the
Plan.
5.2 TIME OF AWARD
A Stock Appreciation Right may be granted: (a) at any time if unrelated to
an Option, or (b) if related to an Option, either at the time of grant, or at
any time thereafter during the term of the Option.
5.3 STOCK APPRECIATION RIGHT RELATED TO AN OPTION
(a) Exercise. Subject to Section 5.7, a Stock Appreciation Right granted in
connection with an Option shall be exercisable at such time or times and only to
the extent that the related Option is exercisable, and will not be transferable
except to the extent the related Option may be transferable. A Stock
Appreciation Right granted in connection with an Incentive Stock Option shall be
exercisable only if the Fair Market Value of a share of the Common Stock on the
date of exercise exceeds the purchase price specified in the related Incentive
Stock Option Agreement.
(b) Amount Payable. Upon the exercise of a Stock Appreciation Right related
to an Option, the Participant shall be entitled to receive an amount determined
by multiplying: (i) the excess of the Fair Market Value of a share of Common
Stock on the day immediately preceding the date of exercise of such Stock
Appreciation Right over the per share purchase price under the related Option,
by (ii) the number of shares of Common Stock as to which such Stock Appreciation
Right is being exercised. Notwithstanding the foregoing, the Committee may limit
in any manner the amount payable with respect to any Stock Appreciation Right by
including such a limit in the Stock Appreciation Rights agreement evidencing the
Stock Appreciation Right at the time it is granted.
(c) Treatment of Related Options and Stock Appreciation Rights Upon
Exercise. Upon the exercise of a Stock Appreciation Right granted in connection
with an Option, the Option shall be canceled to the extent of the number of
shares of Common Stock as to which the Stock Appreciation Right is exercised,
and upon the exercise of an Option granted in connection with a Stock
Appreciation Right, the Stock Appreciation Right shall be canceled to the extent
of the number of shares of Common Stock as to which the Option is exercised or
surrendered.
A-7
<PAGE>
5.4 STOCK APPRECIATION RIGHTS UNRELATED TO AN OPTION
(a) Terms and Conditions. The Committee may grant to Participants Stock
Appreciation Rights unrelated to Options. Stock Appreciation Rights unrelated to
Options shall contain such terms and conditions as to exercisability (subject to
Section 5.7), vesting and duration as the Committee shall determine, but in no
event shall they have a term of greater than ten (10) years. Upon the exercise
of a Stock Appreciation Right unrelated to an Option, the Participant shall be
entitled to receive an amount determined by multiplying: (i) the excess of the
Fair Market Value of a share of Common Stock on the day immediately preceding
the date of exercise of such Stock Appreciation Right over the Fair Market Value
of a share of Common Stock on the date the Stock Appreciation Right was granted,
by (ii) the number of shares of Common Stock as to which the Stock Appreciation
Right is being exercised. Notwithstanding the foregoing, the Committee may limit
in any manner the amount payable with respect to any Stock Appreciation Right by
including such a limit in the Stock Appreciation Rights agreement evidencing the
Stock Appreciation Right at the time it is granted.
(b) Termination of Employment. Stock Appreciation Rights unrelated to
Options shall expire three months after the termination of the Participant's
employment for any reason other than death, disability (as determined by the
Committee) or retirement (under the applicable retirement program of the Company
or one of its subsidiaries or as otherwise determined by the Committee), and
shall be limited to the Stock Appreciation Rights which could have been
exercised by the Participant at the date of termination of employment.
(c) Termination of Employment by Reason of Death, Disability or Retirement.
Upon the termination of a Participant's employment by reason of death,
disability (as determined by the Committee), or normal retirement (under the
applicable retirement program of the Company or one of its subsidiaries or as
otherwise determined by the Committee), Stock Appreciation Rights held at the
termination date by such Participant shall be fully exercisable, irrespective of
whether some or all of the Stock Appreciation Rights were fully exercisable in
accordance with the Stock Appreciation Rights agreement on that date. The
Participant's Stock Appreciation Rights shall expire unless exercised within one
(1) year from the date of such termination.
In the case of termination of a Participant's employment by reason of early
retirement within the meaning of the applicable retirement plan, Stock
Appreciation Rights which may be exercised shall be limited to the Stock
Appreciation Rights which could have been exercised by the Participant at the
date of such early retirement, except that the Committee, in its discretion, may
waive the vesting requirements of such Stock Appreciation Rights. The
Participant's Stock Appreciation Rights shall expire unless exercised within one
(1) year from the date of such termination.
The Committee may, at any time on or before the termination of the exercise
period of the Participant's Stock Appreciation Rights, extend the exercise
period if the Participant's employment is terminated for a reason specified in
this section. If so extended, the term of the exercise period shall expire on
the date specified by the Committee, which date shall be no later than the date
which is sixty (60) months following the date of the Participant's termination
of employment. In no event may the term of a Stock Appreciation Right, including
extensions, exceed the term of the Stock Appreciation Right established by the
Committee at the time of the grant.
5.5 METHOD OF EXERCISE
Stock Appreciation Rights shall be exercised by a Participant only by a
written notice delivered to the Committee (in care of the Secretary of the
Company) at the Company's principal executive office, specifying the number of
shares of Common Stock with respect to which the Stock Appreciation Right is
being exercised. If requested by the Committee, the Participant shall deliver
the Stock Appreciation Rights Agreement evidencing any related Option to the
Secretary of the Company who shall endorse thereon a notation of such exercise
and return such Stock Appreciation Rights agreement to the Participant.
A-8
<PAGE>
5.6 FORM OF PAYMENT
Payment of the amount determined under Sections 5.3(b) or 5.4(a) may be made
in the discretion of the Committee solely in whole shares of Common Stock in a
number determined at their Fair Market Value on the day immediately preceding
the date of exercise of the Stock Appreciation Right, or solely in cash, or in a
combination of cash and Common Stock. If the Committee determines to make full
payment in Common Stock and the amount payable results in a fractional share of
Common Stock, payment for the fractional share of Common Stock will be made in
cash. Notwithstanding the foregoing, no payment in the form of cash may be made
upon the exercise of a Stock Appreciation Right to an officer of the Company or
of its subsidiaries who is subject to liability under Section 16(b) of the
Exchange Act, unless the exercise of such Stock Appreciation Right is made
either: (a) during the period beginning on the third business day and ending on
the twelfth business day following the date of release for publication of the
Company's quarterly or annual statements of earnings; or (b) pursuant to an
irrevocable election to receive cash made at least six months prior to the
exercise of such Stock Appreciation Right.
5.7 RESTRICTIONS
No Stock Appreciation Right may be exercised before the date six (6) months
after the date it is granted, except that this restriction shall not apply in
the event of death or disability (as determined by the Committee) of the
Participant occurring before the expiration of the six month period.
5.8 ACCELERATION EVENT
Notwithstanding anything contained in this Plan to the contrary, in the
event of an Acceleration Event, subject to Section 5.7, all Stock Appreciation
Rights shall become immediately and fully exercisable.
VI. PERFORMANCE UNITS
6.1 TERMS AND CONDITIONS OF AWARD
One Performance Unit shall have a cash value equal to the Fair Market Value
of one share of Common Stock. The number of Performance Units to which the
Participant is entitled is based upon achievement of certain Management
Objectives (as defined in Section 6.2) over a Performance Period (as defined in
Section 6.3) as determined by the Committee at the time of grant and as set
forth in a Performance Unit agreement. The Performance Unit agreement shall
specify the number of Performance Units granted and the Management Objectives
and applicable Performance Period. Awards of Performance Units shall be made
under the long-term incentive component of the Plan.
6.2 MANAGEMENT OBJECTIVES
Performance Units shall be deemed to have been earned by a Participant based
upon fulfillment of Management Objectives specified by the Committee at the time
of grant. The Management Objectives may be the Participant's length of service
and/or specified levels of earnings, return on assets, leverage ratio, loan loss
reserve ratio, earnings-per-share, overhead ratio or return on equity achieved
by the Company or any subsidiary, department or function of the Company in which
the Participant is employed. Management Objectives relating to any particular
grant of a Performance Unit need not be the same as those relating to any other
grant, whether made at the same or a different time.
6.3 PERFORMANCE PERIOD
The Performance Period with respect to any Performance Unit shall be the
period of time within which the Management Objectives relating to that grant are
to be achieved (which shall be no less than twelve (12) months). The Committee
shall determine the length of the Performance Period, which shall commence on
the date of grant of the Performance Units.
A-9
<PAGE>
6.4 EARNING OF AWARD
The Committee shall, promptly after the date on which the necessary
financial or other information for a particular Performance Period becomes
available, determine the extent to which the Management Objectives have been
achieved prior to the expiration of the Performance Period and, if such
Management Objectives have been achieved, the restrictions on such Performance
Units may, in the discretion of the Committee, be deemed to have been satisfied
prior to the expiration of the Performance Period. Upon the expiration of the
Performance Period, if the Committee determines that the Management Objectives
have not been met, the Performance Units shall revert to the Company.
6.5 RIGHTS AS SHAREHOLDER
During the Performance Period and subject to the restrictions set forth in
Article VI, a Participant may have the right, as determined by the Committee at
the time of the grant, to receive an amount equal to the dividends paid on the
Common Stock at the same time and in the same amount as other shareholders of
the Company (by assuming that, for purposes of such dividend, each Performance
Unit is equivalent to one share of Common Stock).
6.6 TERMINATION OF EMPLOYMENT
If any Participant's employment has terminated due to the Participant's
death, disability or retirement within the meaning of the applicable retirement
plan prior to the end of the Performance Period, and the Committee has
determined that applicable Management Objectives have been met, the extent to
which Performance Units shall be deemed to have been achieved shall be
determined by multiplying the amount of the Performance Units which would have
been earned had the Participant's employment not been terminated by a fraction,
the numerator of which is the number of full calendar months such Participant
was employed during the Performance Period and the denominator of which is the
total number of full calendar months in the Performance Period.
6.7 FORM OF PAYMENT
In accordance with Section 6.4, upon the expiration of the Performance
Period and the determination by the Committee that the Management Objectives
established by the Committee at the time of grant of the Performance Units have
been met, the Company shall distribute cash to the Participant in an amount
equal to the number of Performance Units multiplied by the Fair Market Value of
the Common Stock as of the date of distribution.
6.8 ACCELERATION EVENT
Notwithstanding anything herein to the contrary, if an Acceleration Event
has occurred, then all restrictions on the Performance Units shall be deemed to
have been satisfied as of the date of the Acceleration Event, and such
Performance Units shall become fully payable on the date such Acceleration Event
occurred.
VII. STOCK OPTION AWARDS TO NON-EMPLOYEE DIRECTORS
7.1 TERMS AND CONDITIONS OF OPTIONS
Subject to the following provisions, all stock option awards granted to
Directors ("Director Awards") under this Article VII shall be in such form and
upon such terms and conditions described herein.
7.2 NON-QUALIFIED STOCK OPTIONS
The terms of a Director Award shall, at the time of grant, provide that it
will not be treated as an incentive stock option within the meaning of Section
422 of the Code.
7.3 OPTION PRICE
The option price per share shall be at least the Fair Market Value of the
Common Stock on the date the Director Award is granted.
A-10
<PAGE>
7.4 TERM OF OPTION
The term of a Director Award shall not exceed ten (10) years from the date
of grant.
7.5 AWARDS TO DIRECTORS
Each active non-employee Director shall receive an initial option to
purchase 5,000 shares of Company stock upon the date of the first Board of
Directors meeting after his or her election as a new Director, or at the 1997
Annual Meeting of Shareholders for current Directors. At each subsequent Annual
Meeting of Shareholders, then active Directors will receive an option to
purchase of 2,000 shares of Company stock.
7.6 PAYMENT
Payment for shares upon exercise of a Director Award shall be in such manner
and at such time or times as shall be determined by the Committee at the time of
grant, in cash, in Common Stock, including Restricted Stock, through the
surrender of Stock Options or Stock Appreciation Rights, or any combination
thereof, or by or through other contingent grants which the Committee determines
are consistent with the Plan's purposes and applicable law.
7.7 EXERCISE OF OPTION
Director Awards shall be exercisable in whole or in part to the extent, and
subject to this section and Section 7.8, as follows: (i) fifty percent (50%) of
the shares subject to the Director Awards shall become exercisable on the third
anniversary of the date of grant of the Director Awards and (ii) an additional
twenty-five percent (25%) of the shares subject to the Director Awards shall
become exercisable on each of the next two anniversaries of the date of grant.
In no event, however, and notwithstanding anything in this section or Section
7.8 to the contrary, shall a Director Award be exercised after the expiration of
ten (10) years from the date of grant.
7.8 TERMINATION OF SERVICE AS DIRECTOR
A Participant's Director Award shall expire three months after the
termination of the Director's service as a member of the Board of Directors of
the Company (or as may sooner occur under Section 7.4) for any reason other than
death, disability or retirement (defined as the termination of services as a
Director after at least five (5) years of service as a Director), and shall be
limited to the shares which could have been purchased by the Participant at the
date of termination.
7.9 TERMINATION OF SERVICE AS DIRECTOR BY REASON OF DEATH, DISABILITY OR
RETIREMENT
Upon the termination of a Director's services as a Director by reason of
death, disability, or retirement (as defined in Section 7.8 above), Director
Awards held at the termination date by such Director shall be exercisable by the
Director or his or her estate (in the case of death), irrespective of whether
the options were fully exercisable in accordance with Section 7.6 on that date.
The Director's Director Award shall expire unless exercised within one year from
the date of such termination, subject to Section 7.4.
7.10 ACCELERATION EVENT
Notwithstanding anything herein to the contrary, if an Acceleration Event
has occurred, then all of the shares subject to the Director Award shall
immediately become earned and the Director Award shall become exercisable with
respect to such shares on the date of such Acceleration Event.
VIII. ADDITIONAL PROVISIONS
8.1 GENERAL RESTRICTIONS
Each grant under the long-term incentive component of the Plan shall be
subject to the requirement that if the Committee shall determine, at any time,
that: (a) the listing, registration or qualification of the shares of Common
Stock subject or related thereto upon any securities exchange or under any state
or federal law; or (b) the consent or approval of any government regulatory
body, or (c) an agreement by the Participant with respect to the disposition of
shares of Common Stock, is necessary or desirable as a
A-11
<PAGE>
condition of, or in connection with, the granting or the issuance or purchase of
shares of Common Stock thereunder, such grant may not be consummated in whole or
in part unless such listing, registration, qualification, consent, approval or
agreement shall have been effected or obtained free of any conditions not
acceptable to the Committee.
8.2 ADJUSTMENTS FOR CHANGES IN CAPITALIZATION
In the event of a reorganization, recapitalization, stock split, stock
dividend, combination of shares, rights offer, liquidation, dissolution, merger,
consolidation, spin-off or sale of assets, or any other change in or affecting
the corporate structure or capitalization of the Company, the Board of Directors
shall make such adjustments as the Committee may recommend, and as the Board of
Directors in its discretion may deem appropriate, in the number and kind of
shares authorized under the long-term incentive component of the Plan, in the
number, option price or kind of shares covered by the grants and in any
outstanding grants under the Plan in order to prevent substantial dilution or
enlargement thereof.
8.3 AMENDMENTS
The Board of Directors may discontinue the Plan at any time, and may amend
it from time to time, but no amendment, without approval by shareholders, may
(a) increase the total number of shares which may be issued under the long-term
incentive component of the Plan, except as provided in Section 8.2 hereof, (b)
change the class of employees of the Company to whom awards may be made, or (c)
cause awards under the Plan to no longer comply with Rule 16b-3 of the Exchange
Act or any other federal or state statutory or regulatory requirements.
8.4 MODIFICATION OR SUBSTITUTION
For awards to Participants other than non-management directors and subject
to the terms of the Plan, the Committee may modify outstanding awards or accept
the surrender of outstanding awards and make new awards in substitution for them
under the long-term incentive component of the Plan, provided that the
modification does not adversely alter or impair any rights or obligations of the
Participant without the Participant's consent and does not constitute
"repricing" as such term is defined in 17 CFR 229.402(i)(1).
8.5 CANCELLATION OF AWARDS
Any grant under the long-term incentive component of the Plan may be
canceled at any time with the consent of the Participant, and a new grant may be
provided to such Participant in lieu thereof, provided the cancellation and
reissuance does not constitute "repricing" as such term is defined in 17 CFR
229.402(i)(1).
8.6 SHARES SUBJECT TO THE PLAN
Shares distributed pursuant to the long-term incentive component of the Plan
shall be made available from authorized but unissued shares or from shares
purchased or otherwise acquired by the Company for use in the Plan, as shall be
determined from time to time by the Committee.
8.7 RIGHTS OF A SHAREHOLDER
Participants under the Plan, unless otherwise provided by the Plan, shall
have no rights as shareholders by reason thereof unless and until certificates
for shares of Common Stock are issued to them.
8.8 WITHHOLDING
(a) The Company shall have the right to deduct from any distribution of cash
or Common Stock to any Participant an amount equal to the federal, state and
local income taxes and other amounts as may be withheld (the "Withholding
Taxes") with respect to any grant under the Plan. If a Participant is to
experience a taxable event in connection with the receipt of cash or shares of
Common Stock pursuant to an Option exercise or payment of a grant (a "Taxable
Event"), the Participant shall pay the Withholding Taxes to the Company prior to
the issuance of such shares of Common Stock. In satisfaction of the obligation
to pay Withholding Taxes to the Company, the Participant may make a written
election (the "Tax Election"), which may be accepted or rejected in the
discretion of the Committee, to have withheld a portion of the cash or shares of
Common Stock then issuable to the Participant having an aggregate Fair Market
Value on the day
A-12
<PAGE>
immediately preceding the date of such issuance equal to the Withholding Taxes,
provided that in respect of a Participant who may be subject to liability under
section 16(b) of the Exchange Act either: (i) in the case of a Taxable Event
involving an Option, grant of Restricted Stock, or Stock Appreciation Rights (A)
the Tax Election is made at least six (6) months prior to the date of the
Taxable Event and (B) the Tax Election is irrevocable with respect to all
Taxable Events of a similar nature occurring prior to the expiration of six (6)
months following a revocation of the Tax Election; or (ii) in the case of the
exercise of an Option (A) the Participant makes the Tax Election at least six
(6) months after the date the Option was granted, (B) the Option is exercised
during the ten (10) day period beginning on the third business day and ending on
the twelfth business day following the release for publication of the Company's
quarterly or annual statement of sales and earnings (the "Window Period") and
(C) the Tax Election is made during the Window Period in which the related
Option is exercised or prior to such Window Period and subsequent to the
immediately preceding Window Period; or (iii) in the case of a Taxable Event
relating to the payment of any award (A) the Participant makes the Tax Election
at least six (6) months after the date the Restricted Stock or Stock
Appreciation Rights were granted and (B) the Tax Election is made (x) in the
case of a Taxable Event occurring within a Window Period, during the Window
Period in which the Taxable Event occurs, or (y) in the case of a Taxable Event
not occurring within a Window Period, during the Window Period immediately
preceding the Taxable Event relating to the Restricted Stock or Stock
Appreciation Rights. Notwithstanding the foregoing, the Committee may, by the
adoption of rules or otherwise, (1) modify the provisions of this section as may
be necessary to ensure that the Tax Elections will be exempt transactions under
section 16(b) of the Exchange Act, and (2) permit Tax Elections to be made at
such other times and subject to such other conditions as the Committee
determines will constitute exempt transactions under section 16(b) of the
Exchange Act.
(b) Except in the case of Non-Qualified Stock Option grants to
non-management directors, the Committee shall have the authority, at the time of
grant of a Non-Qualified Stock Option, Restricted Stock, Stock Appreciation
Right or Performance Unit under the Plan or at any time thereafter, including
upon any event constituting an Acceleration Event (as hereinafter defined), to
grant tax bonuses to designated Participants to be paid upon their exercise of
Non-Qualified Stock Options or payment in respect of Restricted Stock, Stock
Appreciation Rights or Performance Units granted hereunder. The amount of any
such payments shall be determined by the Committee but shall not be greater than
the lesser of: (a) the difference between the option price (as established
pursuant to Section 3.3, subject to adjustment, if any, pursuant to Section 8.2)
and the Fair Market Value, at the time of exercise of the option, of the shares
of Common Stock acquired (the "Spread"); or (b) the Spread times a fraction the
numerator of which is the maximum federal individual income tax rate payable by
a Participant optionee on such Spread (at the date of exercise) and the
denominator of which is 50 percent (except that, with respect to Restricted
Stock, Stock Appreciation Rights or Performance Units, the "Spread," for
purposes of applying this section, shall be the difference between the amount
paid for the Restricted Stock, Stock Appreciation Right or Performance Unit, as
applicable, and the Fair Market Value of the Common Stock (or cash)
distributed). The Committee shall have full authority in its absolute discretion
to determine the amount of any such tax bonus (subject to the limits of this
section) and the terms and conditions affecting the vesting and payment thereof.
Such supplemental payment shall be made in cash.
8.9 NONASSIGNABILITY
Except as expressly provided in the Plan, no grant shall be transferable
except: (i) by gift to the grantee's spouse or natural, adopted or step-children
or grandchildren ("Immediate Family Members") or to a trust for the benefit of
one or more of the grantee's Immediate Family Members or to a family charitable
trust established by the grantee or the grantee's family, but only with the
approval of the Committee; (ii) by will; (iii) by the laws of descent and
distribution; or (iv) by a qualified domestic relations order ("QDRO") as
defined by the Code or Title I of the Employee Retirement Income Security Act of
1974, as amended, or the rules thereunder. Any Stock Option award transferred by
the grantee under Section (i) above may not be subsequently transferred by the
transferee. During the lifetime of the Participant, except as expressly provided
in the Plan, grants under the Plan shall be exercisable only by such Participant
or by the guardian or legal representative of such Participant or pursuant to a
QDRO.
A-13
<PAGE>
8.10 NONUNIFORM DETERMINATIONS
Determinations by the Committee under the Plan (including, without
limitation and except for non-management directors, determinations of the
persons to receive awards under either the annual or long-term incentive
components of the Plan, the form, amount and timing of such awards, and the
terms and provisions of such awards and the agreements evidencing the same) need
not be uniform and may be made by it selectively among persons who receive, or
are eligible to receive, awards under the Plan, whether or not such persons are
similarly situated.
8.11 NO GUARANTEE OF EMPLOYMENT
Awards under the Plan shall not constitute an assurance of continued
employment for any period.
8.12 EFFECTIVE DATE; DURATION
The Plan shall become effective as of April 16, 1997, subject to approval by
shareholders at the Company's Annual Meeting of Shareholders. No awards may be
made under the Plan after April 15, 2002, but awards theretofore made may extend
beyond such date.
8.13 FAIR MARKET VALUE
The phrase Fair Market Value on any date means the average of the high and
low sales prices of the shares of Common Stock on such date on the principal
national securities exchange on which such shares of Common Stock are listed or
admitted to trading. If the shares of Common Stock on such date are not listed
or admitted to trading, the Fair Market Value shall be the value established by
the Board in good faith and, in the case of an Incentive Stock Option, in
accordance with Section 422 of the Code.
8.14 ACCELERATION EVENT
Notwithstanding anything herein to the contrary, if a Change in Control of
the Company occurs, or if the Committee determines in its sole discretion that
an Acceleration Event has occurred, then all Incentive Stock Options,
Non-Qualified Stock Options, and Stock Appreciation Rights shall become fully
exercisable and all restrictions on the Restricted Stock Award and Performance
Units shall expire as of the date such Change in Control occurred or the
Committee determines that an Acceleration Event has occurred.
For purposes of the Plan, an Acceleration Event includes, but is not limited
to, any Change in Control of the Company, which shall be deemed to have occurred
if the conditions set forth in any one of the following paragraphs shall have
been satisfied:
(i) any person, as defined in Section 3(a)(9) of the Exchange Act, as
such term is modified in Sections 13(d) and 14(d) of the Exchange Act (other
than (A) any employee plan established by the Company, which for these
purposes shall be deemed to be the Company and any corporation, association,
joint venture, proprietorship or partnership which is connected with the
Company either through stock ownership or through common control, within the
meaning of Sections 414(b) and (c) and 1563 of the Internal Revenue Code of
1986 as amended, (B) the Company or any of its affiliates (as defined in
Rule 12b-2 promulgated under the Exchange Act), (C) an underwriter
temporarily holding securities pursuant to an offering of such securities,
or (D) a corporation owned, directly or indirectly, by stockholders of the
Company in substantially the same proportions as their ownership of the
Company) (a "Person"), is or becomes the beneficial owner (as defined in
Rule 13d-3 promulgated under the Exchange Act), directly or indirectly, of
securities of the Company (not including in the securities beneficially
owned by such Person any securities acquired directly from the Company)
representing 25% or more of the combined voting power of the Company's then
outstanding voting securities;
(ii) during any period of up to two consecutive years (not including any
period prior to the effective date of this Plan) individuals who, at the
beginning of such period, constitute the Board cease for any reason to
constitute at least a majority thereof, provided that any person who becomes
a director subsequent to the beginning of such period and whose nomination
for election is approved by at least two-thirds of the directors then still
in office who either were directors at the beginning of such period or whose
election or nomination for election was previously so approved (other than a
director
A-14
<PAGE>
(A) whose initial assumption of office is in connection with an actual or
threatened election contest relating to the election of the directors of the
Company, as such terms are used in Rule 14a-11 of Regulation 14A under the
Exchange Act or (B) who was designated by a Person who has entered into an
agreement with the Company to effect a transaction described in clause (i),
(iii) or (iv) hereof) shall be deemed a director as of the beginning of such
period;
(iii) the stockholders of the Company approve a merger or consolidation
of the Company with any other corporation (other than (A) a merger or
consolidation that would result in the voting securities of the Company
outstanding immediately prior thereto continuing to represent (either by
remaining outstanding or by being converted into voting securities of the
surviving entity or any parent thereof, in combination with the ownership of
any trustee or other fiduciary holding securities under an employee benefit
plan of any corporation, at least 51% of the combined voting power of the
voting securities of the Company or such surviving entity or any parent
thereof outstanding immediately after such merger or consolidation, or (B) a
merger or consolidation effected to implement a recapitalization of the
Company (or similar transaction) in which no Person is or becomes the
beneficial owner (as defined in clause (i) above), directly or indirectly,
of securities of the Company (not including in the securities beneficially
owned by such Person any securities acquired directly from the Company
representing 25% or more of the combined voting power of the Company's then
outstanding voting securities); or
(iv) the stockholders of the Company approve a plan of complete
liquidation of the Company or an agreement for the sale or disposition by
the Company of all or substantially all of the Company's assets, other than
a sale or disposition by the Company of all or substantially all of the
Company's assets to an entity, at least 75% of the combined voting power of
the voting securities of which are owned by persons in substantially the
same proportions as their ownership of the Company immediately prior to such
sale.
8.15 SECURITIES LAWS
All references to provisions of the federal securities laws are to such
provisions as in effect on January 1, 1997, without regard to any subsequent
amendments of, changes to or revocation of such provisions.
A-15
<PAGE>
BARNETT OFFICE PARK LOCATION
A map showing the location of the Barnett Office Park appears on the outside
back cover of the Proxy Statement. The map measures approximately 5 inches
square and reflects the location of the Barnett Office Park in relation to I-95;
U.S. 1 and S.R. 115 (Southside Boulevard), as well as to other local landmarks
including The Avenues Shopping Mall, the St. Johns River and downtown
Jacksonville.
The Barnett Office Park is located at 9000 Southside Boulevard,
Jacksonville, Florida. The Annual Meeting will be held in the Multipurpose Room
on the First Floor of Building 500. There is a parking garage adjacent to
Building 500.
(Please note: The Office Park can be entered only from Southside Boulevard,
and not from U.S. 1 or I-95.)
<PAGE>
<TABLE>
<CAPTION>
<S><C>
/X/ PLEASE MARK YOUR
VOTE AS IN THIS
EXAMPLE
THIS PROXY WILL BE VOTED AS DIRECTED, OR, IF NO DIRECTION IS INDICATED, WILL BE VOTED "FOR PROPOSALS 1 AND 2.
- ---------------------------------------------------------------------------------------------------------------------------------
THE BOARD OF DIRECTORS RECOMMENDS A VOTE "FOR" PROPOSALS 1 AND 2.
- ---------------------------------------------------------------------------------------------------------------------------------
FOR WITHHELD FOR AGAINST ABSTAIN SPECIAL NOTE
/ / / / / / / / / / ------------
1. Election of 2. Approval of
Directors. Performance-Based Comments
(see reverse) Incentive Plan. (see reverse) / /
For, except vote withheld from the following nominee(s):
Will Attend Annual Meeting / /
- --------------------------------------------------------
- ---------------------------------------------------------------------------------------------------------------------------------
Please sign exactly as name or names appear on
this proxy card. Executors, administrators,
trustees, or other representatives should so
indicate when signing. If a corporation,
please sign in corporate name by president or
other authorized officer. If a partnership,
please sign in partnership name by authorized
person.
----------------------------------------------
----------------------------------------------
Signature(s) of Shareholder(s) Date
-- FOLD AND DETACH HERE --
BARNETT BANKS, INC.
ANNUAL MEETING OF SHAREHOLDERS
ADMISSION TICKET
APRIL 16, 1997, 10:00 A.M.
BARNETT OFFICE PARK
(A MAP APPEARS ON THE BACK COVER
OF THE PROXY STATEMENT)
9000 SOUTHSIDE BLVD.
JACKSONVILLE, FL 32256
AGENDA
- Call to Order
- Introduction of Directors and Officers
- Election of Directors
- Other Management Proposal
Approval of Performance-Based Incentive Plan
- Tabulation and Results of Vote
- Chairman's Report
- General Question and Answer Period
- Adjournment
=================================================================================================
THIS IS YOUR PROXY. YOUR VOTE IS IMPORTANT. IT IS IMPORTANT THAT YOUR SHARES ARE REPRESENTED
AT THIS MEETING, WHETHER OR NOT YOU ATTEND THE MEETING IN PERSON. TO MAKE SURE YOUR SHARES
ARE REPRESENTED, WE URGE YOU TO COMPLETE AND MAIL THE PROXY CARD ABOVE.
=================================================================================================
</TABLE>
<PAGE>
BARNETT BANKS, INC.
COMMON STOCK
PROXY/VOTING INSTRUCTIONS SOLICITED BY BOARD OF DIRECTORS
FOR ANNUAL MEETING OF SHAREHOLDERS
P APRIL 16, 1997
R
O The undersigned (the "shareholder"), having received the Notice and
X Proxy Statement for the Annual Meeting of Shareholders, appoints James
Y L. Broadhead, Thompson L. Rankin and John A. Williams, and each or any
of them, as proxies, with full power of substitution, to represent the
shareholder and to vote all shares of Common Stock of Barnett Banks,
Inc. which the shareholder is entitled to vote at the Annual Meeting of
Shareholders of the Company, to be held at 9000 Southside Boulevard,
Jacksonville, Florida on Wednesday, April 16, 1997, at 10:00 a.m., local
time, and any an all adjournments of the meeting, in the manner
specified.
Should any other matter requiring a vote of the shareholders arise, the
proxies named above are authorized to vote in accordance with their best
judgment in the interest of the Company. The Board of Directors is not
aware of any matter which is to be presented for action at the meeting
other than as set forth on this card.
Your vote for election of Directors may be indicated on the reverse side
of this card. Five Directors are to be elected at the meeting. The
nominees of the Board of Directors are Marshall M. Criser, Jack B.
Critchfield, Remedios Diaz Oliver, Allen L. Lastinger, Jr. and Stewart
Turley.
PLEASE SIGN AND DATE ON THE REVERSE SIDE AND MAIL PROMPTLY IN THE
ENCLOSED POSTAGE-PAID ENVELOPE OR OTHERWISE TO P.O. BOX 8075, EDISON,
NEW JERSEY, 08818-9045. IF YOU DO NOT SIGN AND RETURN A PROXY OR ATTEND
THE MEETING AND VOTE BY BALLOT, YOUR SHARES CANNOT BE VOTED.
CORPORATE PROFILE
Barnett Banks, Inc. is the leading financial institution in Florida and
ranked in the top 25 in the United States. The Company offers a comprehensive
line of banking and related financial services to retail and business
customers in its primary markets of Florida and southern Georgia. In Florida,
Barnett commands the leading market share in virtually every major banking
line of business. Barnett's mortgage lending, consumer finance and indirect
automobile finance units offer loans and leases nationwide.
Barnett's stock is listed on the New York Stock Exchange.
MISSION STATEMENT
The mission of Barnett is to create value for its owners, customers and
employees as the nationally recognized standard in the financial services
industry.
Our focus will be on satisfying our customers' needs by capitalizing on
our understanding of customers, providing a full range of financial services
and emphasizing our commitment to local market management.
Barnett will be a fully diversified financial services organization with
the acknowledged leadership position in the evolving banking business in its
markets and with a diversified group of other businesses throughout the
nation.
DIRECT PURCHASE PLAN
Barnett's SHAREHOLDER INVESTMENT PLAN is a convenient and cost-effective
way to acquire Barnett common stock.
/ / No brokerage commissions are charged on purchases.
/ / Optional cash purchases of additional common stock can be made.
/ / Participation is voluntary, and you may withdraw at any time.
/ / Dividends can be automatically reinvested.
/ / The minimum initial investment is $1,000.00
If you would like more information on this plan, please contact First
Chicago Trust, Agent at 1-800-328-5822.
