<PAGE>
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of
the Securities Exchange Act of 1934 (Amendment No. )
Filed by the Registrant /X/
Filed by a party other than the Registrant / /
Check the appropriate box:
/ / Preliminary Proxy Statement
/ / Confidential, for Use of the Commission Only (as permitted by Rule
14a-6(e)(2))
/X/ Definitive Proxy Statement
/ / Definitive Additional Materials
/ / Soliciting Material Pursuant to Section 240.14a-11(c) or Section
240.14a-12
Southwest Bancorporation of Texas, Inc.
- --------------------------------------------------------------------------------
(Name of Registrant as Specified In Its Charter)
- --------------------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
/X/ No fee required
/ / Fee computed on table below per Exchange Act Rules 14a-6(i)(1)
and 0-11
(1) Title of each class of securities to which transaction applies:
------------------------------------------------------------------------
(2) Aggregate number of securities to which transaction applies:
------------------------------------------------------------------------
(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (set forth the amount on which the
filing fee is calculated and state how it was determined):
------------------------------------------------------------------------
(4) Proposed maximum aggregate value of transaction:
------------------------------------------------------------------------
(5) Total fee paid:
------------------------------------------------------------------------
/ / Fee paid previously with preliminary materials.
/ / Check box if any part of the fee is offset as provided by Exchange Act Rule
0-11(a)(2) and identify the filing for which the offsetting fee was paid
previously. Identify the previous filing by registration statement number,
or the Form or Schedule and the date of its filing.
(1) Amount Previously Paid:
------------------------------------------------------------------------
(2) Form, Schedule or Registration Statement No.:
------------------------------------------------------------------------
(3) Filing Party:
------------------------------------------------------------------------
(4) Date Filed:
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<PAGE>
SOUTHWEST BANCORPORATION OF TEXAS, INC.
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
TO BE HELD MAY 26, 1998
To the Shareholders of
Southwest Bancorporation of Texas, Inc.
The Annual Meeting of Shareholders (the "Annual Meeting") of Southwest
Bancorporation of Texas, Inc. (the "Company") will be held at the Company's main
offices, 4400 Post Oak Parkway, Houston, Texas, on Tuesday, May 26, 1998, at
10:30 a.m., Houston time, for the following purposes:
1. To elect (i) four Directors of Class II of the Board of Directors to
hold office until the 2001 Annual Meeting of Shareholders and until their
respective successors have been elected and qualified, or until their
earlier resignation or removal, and (ii) one Director of Class I of the
Board of Directors to hold office until the 2000 Annual Meeting of
Shareholders and until his successor has been elected and qualified, or
until his earlier resignation or removal; and
2. To approve an amendment to the Company's 1996 Stock Option Plan to
increase the number of shares of Common Stock issuable thereunder from
650,000 shares to 1,000,000 shares.
3. To ratify the selection of Coopers & Lybrand L.L.P. as the Company's
independent auditors for the year ending December 31, 1998.
4. To transact such other business as may properly come before the
Annual Meeting or any adjournment hereof.
The close of business on Wednesday, April 15, 1998, has been fixed as the
record date for the determination of shareholders entitled to notice of and to
vote at the Annual Meeting; and only shareholders of record at such time will be
entitled to notice and to vote. In compliance with Article 2.27 of the Texas
Business Corporation Act, a list of shareholders entitled to vote at the Annual
Meeting will be available for inspection at the offices of the Company by any
shareholder during usual business hours for a period of ten days prior to the
Annual Meeting. The list of shareholders will also be available for inspection
at the Annual Meeting from 10:30 a.m., local time, until adjournment of the
Annual Meeting.
By Order of the Board of Directors
David C. Farries
EXECUTIVE VICE PRESIDENT,
TREASURER AND SECRETARY
Dated: April 20, 1998
Houston, Texas
YOUR VOTE IS IMPORTANT REGARDLESS OF THE NUMBER OF SHARES YOU MAY OWN. THE
COMPANY'S MANAGEMENT SINCERELY DESIRES YOUR PRESENCE AT THE ANNUAL MEETING.
HOWEVER, SO THAT WE MAY BE SURE THAT YOUR VOTE WILL BE INCLUDED, PLEASE SIGN AND
RETURN THE ENCLOSED PROXY PROMPTLY. YOUR PROXY MAY BE REVOKED AT ANY TIME BEFORE
IT IS VOTED.
<PAGE>
SOUTHWEST BANCORPORATION OF TEXAS, INC.
4400 POST OAK PARKWAY
HOUSTON, TEXAS 77027
(713) 235-8800
------------------------
PROXY STATEMENT
---------------------
This proxy statement is furnished to the shareholders of Southwest
Bancorporation of Texas, Inc., a Texas corporation (the "Company"), for
solicitation of proxies on behalf of the Board of Directors of the Company for
use at the 1998 Annual Meeting of Shareholders (the "Annual Meeting") to be held
May 26, 1998, and at any and all adjournments thereof. The purpose of the
meeting and the matters to be acted upon are set forth herein and in the
accompanying Notice of Annual Meeting of Shareholders.
Shares represented at the Annual Meeting by an executed and unrevoked proxy
in the form enclosed, will be voted in accordance with the instructions
contained therein. If no instructions are given on an executed and returned form
of proxy, the proxies intend to vote the shares represented thereby in favor of
each of the proposals to be presented to and voted upon by the shareholders as
set forth herein, and in accordance with their best judgment on any other matter
which may properly come before the Annual Meeting.
Any proxy given by a shareholder may be revoked by such shareholder at any
time before it is exercised by submitting to the Secretary of the Company a duly
executed proxy bearing a later date, delivering to the Secretary of the Company
a written notice of revocation, or attending the Annual Meeting and voting in
person.
The cost of this solicitation of proxies is being borne by the Company.
Solicitations will be made only by the use of the mail, except that, if deemed
desirable, officers and regular employees of the Company may solicit proxies by
telephone, telegraph or personal calls, without being paid additional
compensation for such services. Brokerage houses, custodians, nominees and
fiduciaries will be requested to forward the proxy soliciting material to the
beneficial owners of the Common Stock, par value $1.00 per share, of the Company
(the "Common Stock") held of record by such persons, and the Company will
reimburse them for their reasonable expenses incurred in this connection.
The Company's Annual Report to Shareholders, including financial statements,
for the year ended December 31, 1997, accompanies but does not constitute part
of this proxy statement.
The mailing to shareholders of this proxy statement and the enclosed proxy
commenced on or about April 20, 1998.
VOTING SHARES AND VOTING RIGHTS
Only holders of record of Common Stock at the close of business on April 15,
1998, are entitled to notice of and to vote at the Annual Meeting and any
adjournments or postponements thereof. At that time, there were outstanding
11,584,874 shares of Common Stock, which is the only outstanding class of voting
securities of the Company. A majority of the outstanding shares of Common Stock
must be represented at the Annual Meeting in person or by proxy in order to
constitute a quorum for the transaction of business. Each holder of Common Stock
shall have one vote for each share of Common Stock registered, on the record
date, in such holder's name on the books of the Company.
A plurality of the votes cast in person or by proxy by the holders of Common
Stock is required to elect a director. The four Class II nominees and the Class
I nominee receiving the highest number of votes cast by the holders of the
Common Stock will be elected as directors. There will be no cumulative voting in
the election of directors.
<PAGE>
Abstentions and broker non-votes will have no effect on the outcome of the
election of directors, assuming a quorum is present or represented by proxy at
the Annual Meeting. With respect to the ratification of the selection of
independent auditors and any other matters, abstentions will have the same legal
effect as a vote against such matter, and broker non-votes will have no effect
on such matters. A broker non-vote occurs if a broker or other nominee of shares
does not have discretionary authority and has not received voting instructions
with respect to a particular matter.
ITEM 1.
ELECTION OF DIRECTORS
Five directors are to be elected at the Annual Meeting. Ernest H. Cockrell,
Paul B. Murphy, Jr., Adolph A. Pfeffer, Jr. and Michael T. Willis have been
nominated to fill the four expiring Class II positions on the Board of
Directors, to hold office until the 2001 Annual Meeting of Shareholders and
until their respective successors have been duly elected and qualified or until
their earlier resignation or removal. Stanley D. Stearns, Jr. has been nominated
for election as a Class I director to fill a new position in that Class created
by the Board of Directors in August 1997. If elected, Mr. Stearns, together with
the other current Class I directors (John B. Brock III, J. David Heaney and
Andres Palandjoglou), will hold office until the 2000 Annual Meeting of
Shareholders and until their respective successors have been duly elected and
qualified or until their earlier resignation or removal. The Class III directors
(John W. Johnson, Walter E. Johnson and Wilhelmina R. Morian) presently hold
office until the 1999 Annual Meeting of Shareholders and until their respective
successors have been duly elected and qualified or until their earlier
resignation or removal.
Although the Board of Directors knows of no reason why any of these nominees
might be unable or refuse to accept nomination or election, if such situation
arises, the persons named in the proxy have the right to use their discretion to
vote for a substitute nominee or nominees designated by the Board of Directors.
All of the nominees have consented to being named herein and to serve if
elected.
The names and ages of the Company's executive officers and directors,
including the four nominees for election to the Class II positions and the
nominee for election to the Class I position on the Board of Directors, the
principal occupation or employment of each of them during the past five years
and at present, the name and principal business of the corporation or other
organization, if any, in which such occupation or employment is or was carried
on, directorships of other public companies or investment companies held by
them, and the period during which the directors have served in that capacity
with the Company are set forth below. All of the directors of the Company are
also directors of the Bank except for Mr. Palandjoglou, and all of the directors
live in Houston, Texas. Each of the directors and executive officers was elected
to the position with the Company shown below in 1996, with the exception of
Messrs. Argue, Bedford, Heaney, Pfeffer, Stearns and Torentinos, who were
elected in 1997.
<TABLE>
<CAPTION>
NAME POSITION AGE
- ------------------------------------ --------------------------------------------------------------------- ---
<S> <C> <C>
John B. Brock III................... Director 65
Ernest H. Cockrell*................. Director 52
J. David Heaney..................... Director 49
John W. Johnson..................... Director and Chairman of the Executive Committee of the Bank's Board 52
of Directors
Walter E. Johnson................... Chairman of the Board and Chief Executive Officer 62
Wilhelmina R. Morian................ Director 51
Paul B. Murphy, Jr.*................ Director, President and Chief Operating Officer 38
Andres Palandjoglou................. Director 50
Adolph A. Pfeffer, Jr.*............. Director 67
</TABLE>
2
<PAGE>
<TABLE>
<CAPTION>
NAME POSITION AGE
- ------------------------------------ --------------------------------------------------------------------- ---
<S> <C> <C>
Stanley D. Stearns, Jr.*............ Director 55
Michael T. Willis*.................. Director 53
Joseph H. Argue III................. Executive Vice President 49
J. Nolan Bedford.................... Executive Vice President of the Company and Vice Chairman of the Bank 59
David C. Farries.................... Executive Vice President, Treasurer and Secretary of the Company and 51
Executive Vice President and Chief Financial Officer of the Bank
Yale Smith.......................... Executive Vice President 61
Sharon K. Sokol..................... Executive Vice President 47
Steve D. Stephens................... Executive Vice President 38
Anthony Torentinos.................. Executive Vice President 48
R. John McWhorter................... Vice President and Controller 33
</TABLE>
- ------------------------
* Nominee for election at Annual Meeting.
JOHN B. BROCK III. Mr. Brock became a director of the Bank in 1991. He has
been Chairman of the Board of Ocean Energy, Inc. ("OEI") since March 27, 1998,
prior to which he had been the Chairman of the Board and Chief Executive Officer
of United Meridian Corp. ("UMC") since May 1995 and a director of UMC since
November 1989. UMC merged with OEI on March 27, 1998. Mr. Brock served as the
President of UMC from May 1996 to October 1996, served as the President and
Chief Executive Officer of UMC from February 1992 to May 1995 and served as the
President and Chief Operating Officer of UMC from November 1989 to February
1992. Mr. Brock is a director and member of the Executive Committee of the Texas
Midcontinent Oil and Gas Association, a director of the National Midcontinent
Oil and Gas Association, a director of the American Petroleum Institute, a
director of St. Luke's Episcopal Hospital and a director of St. Luke's Episcopal
Health System.
ERNEST H. COCKRELL. Mr. Cockrell became a director of the Bank in 1982. In
1996 he became Chairman of Cockrell Oil Corporation, a company involved in oil
and gas exploration and production, prior to which he had been President since
1979. Mr. Cockrell holds B.S. in Engineering and MBA degrees from the University
of Texas in Austin and is also involved in ranching, farming and investments. He
is a Director of Pennzoil Company, Independent Petroleum Association of America,
and the Texas Midcontinent Oil and Gas Association. He is a member of the
All-American Wildcatters' Association and the American Petroleum Institute and
is a member and past Chairman of the Houston chapter of the Young Presidents'
Organization. Mr. Cockrell is also President of The Cockrell Foundation, a
private charitable corporation which supports many Texas charities. He serves on
the board of directors and executive committee of The Methodist Health Care
System, Houston, the board of directors of MethodistCare, Houston and the board
of visitors of the University of Texas M.D. Anderson Hospital, Houston. He is a
member and the former chairman of the Board of Trustees of the Houston Museum of
Natural Science, of the Sam Houston Area Council of the Boy Scouts of America,
and of The University of Texas College of Engineering Foundation Advisory
Council.
J. DAVID HEANEY. Mr. Heaney became a director of the Bank in 1990. He is a
co-founder of Heaney Rosenthal Inc., a private investment company and serves as
its Chairman. In 1986, Mr. Heaney was one of the founders of Sterling Chemicals,
Inc., which later became a public company traded on the New York Stock Exchange.
During his eight years with Sterling, Mr. Heaney served as Sterling's
Administrative Vice President, and later as Chief Financial Officer. Prior to
joining Sterling in 1986, Mr. Heaney was a partner in the Houston law firm of
Bracewell & Patterson, specializing in business transactions. Mr. Heaney holds
J.D. and B.B.A. degrees from the University of Texas.
3
<PAGE>
JOHN W. JOHNSON. Mr. Johnson became a director and Chairman of the Board of
the Bank in 1982 and served in that capacity until 1996, when he was named
Chairman of the Bank's Executive Committee. For more than five years, he has
been Chairman and President of Permian Mud Service, Inc., an oil field service
company with several active subsidiaries including Champion Technologies, Inc.,
Densimix, Inc., and Johnson & Lindley, Inc. He is a Director of Weatherford
Enterra, Inc. and is Chairman of the Board of Trustees of St. John's School. Mr.
Johnson received a Bachelor of Engineering degree from Vanderbilt University in
1968. Mr. Johnson is not related to Walter E. Johnson.
WALTER E. JOHNSON. Mr. Johnson joined the Bank in July 1989 as President,
Chief Executive Officer and a director. In May 1996 he was elected Chairman of
the Board of Directors of the Bank. From October 1972 to February 1988, he
served as President of Allied Bank of Texas, and upon the purchase of that bank
by First Interstate Bancorp, he served as President Central Office of First
Interstate Bank of Texas, N.A. from March 1988 to June 1989. Mr. Johnson served
on the Trust Committee, Profit Sharing Investment Committee, and Board of
Directors of Allied Bank of Texas. He also served as a Director of the holding
company, Allied Bancshares, Inc., which owned 52 banks and reached $9 billion in
assets. Mr. Johnson was the Senior Lending Officer of Allied Bank of Texas and
spent the majority of his time directing the lending staff and business
development. Prior to joining Allied Bank of Texas, he accumulated an additional
12 years of banking experience, primarily with the international department of
Bank of the Southwest. Mr. Johnson is a former member of the Board of Directors
of the Houston Branch of the Dallas Federal Reserve Bank. He is a board member
of the Boy Scouts of America, Junior Achievement and the American Free
Enterprise Society. He is currently active in, and has been chairman of,
numerous major fund raising campaigns for various Houston charities. Mr. Johnson
is a graduate of Texas Christian University.
WILHELMINA R. MORIAN. Ms. Morian became a director of the Bank in 1982.
Since 1980 she has been President of Westview Development, Inc. (real estate
development) and Cockspur, Inc. and a partner in various real estate and oil and
gas ventures. She is Chairman of the Board of the Cullen Trust for Healthcare,
Past Chair, Board of Regents of the University of Houston Systems and serves on
the Board of the Houston Zoological Society, The Neuhaus Education Center, The
Cullen Foundation and The Museum of Fine Arts--Houston.
PAUL B. MURPHY, JR. Mr. Murphy joined the Bank in January 1990 as an
Executive Vice President, was elected a director in 1994, became President in
1996 and acquired the additional title of Chief Operating Officer in February
1998. He began his banking career with Allied Bank of Texas in 1981, in the
commercial lending division. Mr. Murphy received his B.S. degree from
Mississippi State University and his M.B.A. from the University of Texas at
Austin. He is involved in numerous civic and community organizations including:
Young Presidents Organization, Past Chairman of Houston Arts Fund, Trustee of
Children's Museum of Houston, Board member of St. Luke's Episcopal Hospital and
member of the Advisory Board of University of Texas Health Science Center at
Houston.
ANDRES PALANDJOGLOU. Mr. Palandjoglou was elected a director of the Company
upon its formation in 1996, and has been an advisory director of the Bank since
1990. For more than five years, he has been President of Rio Largo, Inc., a
company involved in real estate investments and, as a partner in Memorial
Builders, in the development of residential subdivisions and the construction of
custom homes. Also, Mr. Palandjoglou is involved in textile manufacturing and
ranching in Argentina. He is a member of the Greater Houston Builders
Association.
ADOLPH A. PFEFFER, JR. Mr. Pfeffer became a director of the Bank in 1997.
He was an organizing director of Pinemont Bank in 1960, and served on its Board
of Directors, the last 20 years as Chairman of the Board, until its merger with
the Bank in 1997. Mr. Pfeffer is involved in farming, ranching, real estate and
investment activities. He is a director of the Gillson-Longenbaugh Foundation.
MICHAEL T. WILLIS. Mr. Willis became a director of the Bank in 1988. He has
over 20 years of experience in the personnel services and temporary help
industry. In 1976 he founded Talent Tree Personnel and guided that company
through more than 15 years of rapid growth with sales growing to an
4
<PAGE>
annualized rate of $300 million per year. Resigning from Talent Tree in March
1993, Mr. Willis founded METAMOR Worldwide (formerly COREStaff, Inc.) in July
1993 where he is Chairman of the Board, President and CEO. He is also on the
Board of Serv-Tech, Inc.
JOSEPH H. ARGUE III. Mr. Argue joined the Company and the Bank in April of
1997 as Executive Vice President of the Company and Executive Vice President of
the Bank's lending division at the Five Post Oak office, with 24 years of
banking and lending experience at Wells Fargo Bank (Texas), N.A., First
Interstate Bank of Texas, N.A. and Allied Bank of Texas. He has both bachelor's
and master's degrees in business administration from Stephen F. Austin State
University.
J. NOLAN BEDFORD. Mr. Bedford was elected Vice Chairman of the Board of
Directors of the Bank and Executive Vice President of the Company in 1997, prior
to which time he had served as President and Chief Executive Officer of Pinemont
Bank since 1993. Previously, Mr. Bedford served as Senior Executive Vice
President, Chief Lending Officer and Director of Lockwood National Bank in
Houston from 1985 to 1993.
DAVID C. FARRIES. Mr. Farries joined the Bank in 1993 as Senior Vice
President and Treasurer with 19 years of banking and investment experience with
First City National Bank of Houston and 3 years of public accounting experience
with Price Waterhouse & Co. He was promoted to Chief Financial Officer of the
Bank in 1994 and Executive Vice President of the Company in 1996. Mr. Farries
has both bachelor's and master's degrees in business administration from the
University of Texas. He is a Certified Public Accountant and has his NASD Series
24 (Securities Principal) and Series 7 (Securities Representative) licenses.
R. JOHN MCWHORTER. Mr. McWhorter has been Vice President and Controller of
the Bank since 1990, prior to which he had been employed by Coopers & Lybrand
L.L.P. He graduated from the University of Texas with a B.B.A. in accounting in
1987 and is a certified public accountant.
SHARON K. SOKOL. Ms. Sokol joined the Bank in 1990. She has over 28 years
of banking experience, including over eight years of branch administration and
retail services at Indiana National Bank. After moving to Texas in 1978, she
successfully established several new products and departments at Western Bank,
including a Corporate Cash Management Division. She moved to Texas Commerce Bank
where she was Vice President in Cash Management Marketing. In 1987, she joined
First Interstate Bank of Texas as Vice President and Manager of Cash Management.
Ms. Sokol joined the Bank in February 1990 to establish its cash management
services. In October 1990, she was appointed Chief Bank Operations Officer, and
in 1992 she was appointed Executive Vice President. Ms. Sokol serves as the
Chairperson of the Board of Directors for the Southwest Automated Clearing House
and also serves on the Board of Directors of the Clearing House Association of
the Southwest. She also serves on the Board of Trustees and Executive Committees
for both the Houston Heritage Society and the Juvenile Diabetes Foundation.
YALE SMITH. Mr. Smith has over 30 years of banking experience in Houston.
He has focused his career on middle market lending since his days at First City
National Bank where he managed the Metropolitan Division prior to joining Allied
Bank of Texas in 1981. He joined the Bank in January 1990 as an Executive Vice
President and heads the Bank's downtown branch offices. Mr. Smith is very active
in the Houston community having served as past Chairman of the Board of the
Salvation Army and currently serving as Director of the MIT Forum of Texas and
as an Administrative Board Member of St. Luke's United Methodist Church.
STEVE D. STEPHENS. Mr. Stephens has over 15 years of commercial lending
experience, and is currently in charge of the Bank's Northwest Crossing office,
and the Memorial City office. Prior to joining the Bank as an Executive Vice
President in 1990, he was Senior Vice President and Manager of Commercial
Lending at Texas Commerce Bank Reagan. Mr. Stephens is active in a variety of
community organizations including being past president of the Kiwanis Club of
Houston, a Board member of the Children's Fund and active in the Muscular
Dystrophy Association. He graduated from the University of Houston with a B.B.A.
in accounting in 1980.
5
<PAGE>
ANTHONY TORENTINOS. Mr. Torentinos joined the Bank in May 1997. He has over
20 years of management and consulting experience in the areas of human
resources, planning and administration. He started his Houston banking career in
1979 at Interfirst Bank, then moved to Capital Bank in 1981 as Vice President,
Director of Human Resources. During the past 12 years he has served as an
executive officer for two large regional banking organizations in the
Mid-Atlantic area. Mr. Torentinos is a former officer of the University of Texas
College of Business Administration and a graduate of the University of Texas at
Austin.
COMMITTEES AND MEETINGS OF THE BOARD OF DIRECTORS
The Board of Directors has established audit and compensation committees.
The Audit Committee currently consists of John B. Brock III, J. David Heaney,
Wilhelmina R. Morian, Andres Palandjoglou and Stanley D. Stearns, Jr., none of
whom is an employee of the Company. The Audit Committee reviews the general
scope of the audit conducted by the Company's independent auditors, the fees
charged therefor and matters relating to the Company's internal control systems.
In performing its functions, the Audit Committee meets separately with
representatives of the Company' s independent auditors and with representatives
of senior management. The Audit Committee held four meetings during 1997.
The Compensation Committee currently consists of John B. Brock III, John W.
Johnson, Adolph A. Pfeffer, Jr. and Michael T. Willis, none of whom is an
employee of the Company. The Compensation Committee administers the Company's
stock option plans and makes recommendations to the Board of Directors as to
option grants to Company employees under such plans. In addition, the
Compensation Committee is responsible for making recommendations to the Board of
Directors with respect to the compensation of the Company's executive officers
and is responsible for the establishment of policies dealing with various
compensation and employee benefit matters for the Company. The Compensation
Committee held one meeting during 1997.
During the year ended December 31, 1997, the Board of Directors held four
meetings. In 1997, each incumbent director attended at least 75% of the
aggregate of the total number of meetings of the Board of Directors and the
total number of meetings held by all committees on which he served (in each case
held during the periods that he served), except for Michael T. Willis, John B.
Brock III and J. David Heaney.
DIRECTOR COMPENSATION
In an effort to attract and retain qualified directors, the Bank's Board of
Directors approved a methodology of awarding stock options to directors under
the Company's employee stock option plans, effective beginning in 1994 (the
"Directors' Plan"), which methodology was assumed and continued by the Company
upon the formation thereof in 1996. Pursuant to the Directors' Plan, directors
are awarded options for attendance and participation at monthly directors'
meetings and, additionally, for introducing legitimate business prospects to the
Company. Options to purchase a maximum of 49,175 shares of Common Stock may be
granted under the Directors' Plan during a calendar year with the exercise price
approximating the fair market value of the stock at December 31 of such year.
Directors' options accumulate throughout the year, are issued during the
following year and are considered fully vested upon issuance. Options for 19,400
shares were granted in 1997 for the 1996 calendar year with an exercise price of
$16.50 per share, and options for 21,975 shares were granted in 1998 for the
1997 calendar year with an exercise price of $30.75 per share.
Directors of the Company do not receive any cash compensation for attending
Company Board meetings; however, John W. Johnson receives $25,000 per year for
serving as Chairman of the Executive Committee of the Bank and for serving on
the Bank's Management Committee. Directors of the Bank receive a fee of $500 for
each meeting of the Bank's Board of Directors attended and Directors of the Bank
and the Company receive $200 for each Board Committee meeting attended.
Directors of the Bank who are also employees of the Bank do not receive fees for
attending Board Committee meetings.
THE BOARD OF DIRECTORS RECOMMENDS THAT THE SHAREHOLDERS VOTE "FOR" THE ELECTION
OF THE FIVE NOMINEES FOR DIRECTOR NAMED HEREIN.
6
<PAGE>
PRINCIPAL SHAREHOLDERS
The following table sets forth certain information regarding the beneficial
ownership of the Company's Common Stock as of March 31, 1998, by (i) each
director, (ii) each of the Named Executives (as defined under "Executive
Compensation") and (iii) all directors and executive officers as a group. Unless
otherwise indicated, each person has sole voting and dispositive power over the
shares indicated as owned by such person. No person is known by the Company to
own beneficially 5% or more of the outstanding shares of Common Stock.
<TABLE>
<CAPTION>
PERCENTAGE
NUMBER OF BENEFICIALLY
SHARES OWNED
--------------- -----------
<S> <C> <C>
John B. Brock III......................................................... 49,892(1) *%
Ernest H. Cockrell........................................................ 133,787(2) 1.16
J. David Heaney........................................................... 103,341(3) *
John W. Johnson........................................................... 186,750(4) 1.61
Walter E. Johnson......................................................... 24,210(5) *
Wilhelmina R. Morian...................................................... 229,410(6) 1.98
Paul B. Murphy, Jr........................................................ 22,342(7) *
Andres Palandjogou........................................................ 32,875(8) *
Adolph A. Pfeffer, Jr..................................................... 279,856(9) 2.42
Stanley D. Stearns, Jr.................................................... 173,217(10) 1.50
Michael T. Willis......................................................... 141,520(11) 1.22
Joseph H. Argue III....................................................... 13,800 *
J. Nolan Bedford.......................................................... 56,777(12) *
Steve D. Stephens......................................................... 12,903(13) *
Directors and executive officers as a group............................... 1,542,771(14) 13.33
</TABLE>
- ------------------------
* Does not exceed 1.0%.
(1) Includes 3,625 shares which may be acquired within 60 days pursuant to
outstanding stock options.
(2) Includes 17,500 shares held in trust for the benefit of Ernest H. Cockrell
and 3,225 shares which may be acquired within 60 days pursuant to
outstanding stock options.
(3) Includes 31,160 shares owned by Mr. Heaney's wife, 31,844 shares held in
trust for the benefit of his two children and 3,950 shares which may be
acquired within 60 days pursuant to outstanding stock options.
(4) Includes 40,000 shares held by John W. Johnson, Trustee for the benefit of
his three children and 46,750 shares which may be acquired within 60 days
pursuant to outstanding stock options.
(5) Includes 3,750 shares held by Walter E. Johnson's wife and 3,970 shares
which may be acquired by Walter E. Johnson within 60 days pursuant to
outstanding stock options.
(6) Includes 6,575 shares which may be acquired within 60 days pursuant to
outstanding stock options.
(7) Includes 10,360 shares which may be acquired within 60 days pursuant to
outstanding stock options.
(8) Includes 8,000 shares which may be acquired within 60 days pursuant to
outstanding stock options.
(9) Includes 825 shares which may be acquired within 60 days pursuant to
outstanding stock options.
(10) Includes 400 shares which may be acquired within 60 days pursuant to
outstanding stock options.
(11) Includes 4,000 shares which may be acquired within 60 days pursuant to
outstanding stock options.
(12) Includes 40,875 shares which may be acquired within 60 days pursuant to
outstanding stock options.
(13) Includes 11,875 shares which may be acquired within 60 days pursuant to
outstanding stock options.
(14) Includes 763,059 shares which may be acquired within 60 days pursuant to
outstanding stock options.
7
<PAGE>
EXECUTIVE COMPENSATION
The following table provides certain summary information concerning
compensation paid or accrued by the Company to or on behalf of the Company's
Chairman of the Board and Chief Executive Officer and each of the four other
most highly compensated executive officers of the Company (the "Named
Executives") for the fiscal years ended December 31, 1997 and 1996.
<TABLE>
<CAPTION>
LONG TERM
COMPENSATION
ANNUAL COMPENSATION -------------
---------------------------------------------- SECURITIES
NAME AND OTHER ANNUAL UNDERLYING ALL OTHER
PRINCIPAL POSITION YEAR SALARY BONUS COMPENSATION OPTIONS (#) COMPENSATION(1)
- -------------------------------------- --------- --------- --------- ------------- ------------- -----------------
<S> <C> <C> <C> <C> <C> <C>
Walter E. Johnson .................... 1997 $ 350,000 $ 175,000 $ 7,545 1,250 $ 4,800
Chairman & Chief Executive Officer 1996 325,000 662,500 6,006 250,900 4,500
Paul B. Murphy, Jr. .................. 1997 200,000 100,000 9,299 825 4,800
President and Chief Operating 1996 175,000 87,500 6,660 60,425 4,500
Officer
J. Nolan Bedford ..................... 1997 177,575 33,000 2,520 375 5,264
Executive Vice President and 1996 -- -- -- -- --
Vice Chairman of the Bank
Joseph H. Argue III .................. 1997 160,000 48,000 5,516 30,000 --
Executive Vice President 1996 -- -- -- -- --
Steve D. Stephens .................... 1997 140,000 56,000 10,000 -- 4,200
Executive Vice President 1996 125,000 50,000 3,000 19,625 3,750
</TABLE>
- ------------------------
(1) Consists of the Company's contribution to the Company's 401(k) Plan.
OPTION GRANTS DURING 1997
The following table contains information concerning the grant of stock
options to the Named Executives during fiscal year 1997.
<TABLE>
<CAPTION>
% OF TOTAL POTENTIAL REALIZABLE VALUE AT
NUMBER OF OPTIONS ASSUMED ANNUAL RATES
SECURITIES GRANTED TO OF STOCK PRICE
UNDERLYING EMPLOYEES IN EXERCISE APPRECIATION FOR OPTION TERM(1)
OPTIONS FISCAL YEAR PRICE EXPIRATION -----------------------------------
NAME GRANTED 1997 ($/SH) DATE 0%($) 5%($) 10%($)
- -------------------------------- ----------- -------------- ----------- ----------- ----------- ---------- ----------
<S> <C> <C> <C> <C> <C> <C> <C>
Walter E. Johnson............... 1,250 1.11% $ 30.75 1/2/08 $ 0 $ 24,173 $ 61,259
Paul B. Murphy, Jr. ............ 825 0.73% 30.75 1/2/08 0 15,954 40,431
J. Nolan Bedford................ 375 0.33% 30.75 1/2/08 0 7,252 18,378
Joseph H. Argue III............. 30,000 26.67% 18.38 4/3/07 0 346,772 878,790
Steve D. Stephens............... 0 0.00% -- -- -- -- --
</TABLE>
- ------------------------
(1) The amounts shown under these columns are the result of calculations at 0%
and at the 5% and 10% rates required by the Securities and Exchange
Commission and are not intended to forecast future appreciation of the
Company's stock price.
8
<PAGE>
STOCK OPTION EXERCISES AND FISCAL YEAR-END VALUES
The following table sets forth certain information concerning option
exercises during the year ended December 31, 1997 by the Named Executives and
the value of unexercised options held by each of the Named Executives at
December 31, 1997.
<TABLE>
<CAPTION>
NUMBER OF SECURITIES
UNDERLYING UNEXERCISED VALUE OF UNEXERCISED
OPTIONS AT IN-THE-MONEY-OPTIONS AT
SHARES DECEMBER 31, 1997 DECEMBER 31, 1997(2)
ACQUIRED VALUE -------------------------- ---------------------------
ON EXERCISE REALIZED(1) EXERCISABLE UNEXERCISABLE EXERCISABLE UNEXERCISABLE
----------- ------------ ----------- ------------- ------------ -------------
<S> <C> <C> <C> <C> <C> <C>
Walter E. Johnson............ 250,000 $ 4,025,000 108,220 272,690 $ 3,051,009 $ 4,345,764
Paul B. Murphy, Jr. ......... 20,000 390,750 20,785 85,040 506,357 1,619,870
J. Nolan Bedford............. 12,000 261,630 40,500 -- 888,771 --
Joseph H. Argue III.......... -- -- -- 30,000 -- 390,000
Steve D. Stephens............ 10,500 303,065 18,125 46,375 544,922 1,013,003
</TABLE>
- ------------------------
(1) The "value realized" represents the difference between the exercise price of
the option shares and the market (sale) price of the option shares on the
date of exercise without considering any taxes which may have been owed.
(2) The value is based on $31.375 per share, which was the closing sale price
reported on The NASDAQ Stock Market on December 31, 1997.
EMPLOYMENT AGREEMENTS
Walter E. Johnson, Paul B. Murphy, Jr., Joseph H. Argue III, Steve D.
Stephens, David C. Farries, Sharon K. Sokol, Yale Smith, and Anthony Torentinos
have entered into change in control agreements with the Company. Each agreement
is for a term of three years and automatically renews each year absent notice to
the contrary from the Company. Each agreement provides that upon the occurrence
of a change in control, (i) the agreement is converted into a three-year
employment agreement, which provides for a minimum annual compensation equal to
the employee's current base salary plus the highest annual cash bonus paid to
the employee during the three preceding years, (ii) all stock options held by
the employee become fully exercisable (regardless of whether then vested) and
(iii) all restrictions on any restricted stock granted to the employee shall
lapse. Such employment agreement also provides that if the employee is
thereafter terminated without cause or the employee terminates his or her
employment as a result of the employer's breach of the agreement, the employee
shall be entitled to receive from the Company a lump-sum severance payment equal
to the discounted present value of the amount of compensation payable under such
agreement for the remainder of the three-year term thereof. The employment
agreements also automatically renew each year absent notice to the contrary from
the Company.
In connection with the merger of Pinemont Bank with the Bank in August,
1997, the Company entered into a three year employment agreement with J. Nolan
Bedford, providing for a minimum annual salary of $177,575. The agreement
provides that Mr. Bedford will be the senior officer in charge of all lending
and personnel functions and responsibilities over the former branch locations of
Pinemont Bank and will hold the title of Vice Chairman of the Board of Directors
of the Bank.
INTERESTS OF MANAGEMENT AND OTHERS IN CERTAIN TRANSACTIONS
Many of the directors and executive officers of the Company and their
associates, which include corporations, partnerships and other organizations in
which they are officers or partners or in which they and their immediate
families have at least a 5% interest, are customers of the Bank. During 1997 the
Bank made loans in the ordinary course of business to certain directors of the
Company and their associates, all of which the Company believes were on
substantially the same terms, including interest rates and
9
<PAGE>
collateral, as those prevailing at the time for comparable transactions with
persons unaffiliated with the Company and did not involve more than the normal
risk of collectibility or present other unfavorable features. Loans to
directors, executive officers and principal shareholders of the Company (i.e.,
those who own 10% or more of the outstanding shares of Common Stock) are subject
to limitations contained in the Federal Reserve Act, the principal effect of
which is to require that extensions of credit by the Bank to executive officers,
directors and principal shareholders satisfy the foregoing standards. On
December 31, 1997, all of such loans aggregated approximately $13.0 million,
which was 11.7% of the Bank's Tier 1 capital at such date. The Company expects
to have such transactions or transactions on a similar basis with its directors,
executive officers and principal shareholders and their associates in the
future.
COMPENSATION COMMITTEE REPORT ON EXECUTIVE COMPENSATION
The Compensation Committee of the Board of Directors is pleased to present
this report on executive compensation. This report describes the elements of the
Company's executive officer compensation programs and the basis on which 1997
compensation determinations were made by the Compensation Committee with respect
to the executive officers of the Company, including the Named Executives.
COMPENSATION PHILOSOPHY AND OVERALL OBJECTIVES
The goal of the Company's executive compensation policy is to ensure that
executive compensation is linked directly to continuous improvements in
corporate performance and increases in shareholder value, while concurrently
ensuring that key employees are motivated and retained. The following objectives
have been established by the Compensation Committee as guidelines for
compensation decisions:
- The Company must provide a competitive total compensation package that
enables the Company to attract and retain key executives.
- All of the Company's compensation programs must be integrated with its
annual and long-term business objectives so that executives remain focused
on the fulfillment of these objectives.
- The Company's compensation package must include a variable component that
directly links compensation with the overall performance of the Company,
thereby expressly aligning executive compensation with the interest of
shareholders.
The Compensation Committee regularly reviews the Company's compensation
programs to ensure that remuneration levels and incentive opportunities are
competitive and reflect performance. The various components of the compensation
programs for executive officers are discussed below.
BASE SALARY
Base salary levels are largely determined through comparison with banking
organizations of a size similar to the Company. Both local and regional surveys
are utilized to establish base salaries that are within the range of those
persons holding positions of comparable responsibility at other banking
organizations of a size and complexity similar to the Company. Actual base
salaries also are intended to reflect individual performance contributions as
determined through job evaluations. In addition to individual job performance
and the above-referenced market comparisons, other factors may be taken into
consideration, such as cost of living increases as well as an individual's
perceived potential with the Company. All executive officer base salary levels
are considered by the Compensation Committee to be competitive within a
necessary and reasonable range.
It has become the established practice of the Compensation Committee to
review and, if deemed appropriate, adjust the base salaries of the Company's
executive officers on a yearly basis. Accordingly, base salaries were reviewed
and adjusted during 1997, and the base salaries of the Named Executives in the
compensation table appearing in this Proxy Statement reflect the fully
annualized base salaries as adjusted and implemented in 1997.
10
<PAGE>
EMPLOYEE STOCK OPTION PLAN
The Company's officers are eligible to participate in the 1996 Stock Option
Plan referred to in this Proxy Statement. The objective of this Plan (and the
Company's predecessor stock option plans) is to create competitive levels of
compensation tied directly to the attainment of financial objectives which the
Compensation Committee believes are the primary determinants over time of share
price. More specifically, this Plan is designed to foster a systematic
management focus on the corporate goal of consistent and steady earnings growth.
Potential awards for executive officers are intended by the Compensation
Committee to be consistent with incentive bonuses paid by banking companies of a
size similar to that of the Company, provided that actual bonuses remain subject
to increase or decrease on the basis of the Company's actual audited performance
and at the discretion of the Compensation Committee.
1997 COMPENSATION OF THE CHAIRMAN OF THE BOARD AND CHIEF EXECUTIVE OFFICER
In reviewing the 1997 compensation of Walter E. Johnson, the Company's
Chairman of the Board and Chief Executive Officer, the Compensation Committee
undertook the same evaluation set forth above with respect to executive
officers. Mr. Johnson's base salary is reviewed on a yearly basis and most
recently was reviewed and adjusted in January, 1997. His base salary is
considered to be reasonable and competitive based on published compensation
surveys and other publicly available compensation information. His bonus for
1997 performance was determined in January 1998 based on earnings through
December 1997. The Compensation Committee members were provided data concerning
individual compensation history, executive compensation survey data, and
comparative information concerning performance.
OTHER
The Compensation Committee does not currently intend to award compensation
that would result in a limitation on the deductibility of a portion of such
compensation pursuant to Section 162(m) of the Internal Revenue Code of 1986, as
amended; however, the Compensation Committee may in the future decide to
authorize compensation in excess of the limits of Section 162(m) if it
determines that such compensation is in the best interest of the Company.
Compensation Committee
John B. Brock III
John W. Johnson
Adolph A. Pfeffer, Jr.
Michael T. Willis
11
<PAGE>
STOCKHOLDER RETURN PERFORMANCE PRESENTATION
The performance graph shown below compares the cumulative shareholder return
on the Company's Common Stock with the cumulative total return of the Standard &
Poor's 500 Composite Index (the "S&P Index") and the SNL Securities $1.0-$5.0
Billion Bank Index (the "SNL Index") and was prepared based upon the following
assumptions:
1. $100 was invested in the Company's Common Stock, the S&P Index and the
SNL Index on January 28, 1997 at the initial public offering of the
Company's Common Stock of $16.50 per share and the closing price of the
stocks comprising the S&P Index and the SNL Index, respectively, on such
date. The Company's Common Stock began trading on The NASDAQ Stock Market
on January 28, 1997.
2. Dividends are reinvested on the ex-dividend dates.
The companies that comprise the SNL Index are all publicly-traded banks and
bank holding companies in the United States having between $1.0 billion and $5.0
billion in assets during the period shown.
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
<TABLE>
<CAPTION>
TOTAL RETURN PERFORMANCE
<S> <C> <C> <C>
Index Value
Southwest Bancorporation of Texas,
Inc. S&P 500 SNL $1B-$5B Bank Index
1/28/97 $100.00 $ 100.00 $100.00
3/31/97 $107.69 $ 99.34 $102.96
6/30/97 $154.55 $ 116.69 $120.74
9/30/97 $165.04 $ 125.43 $139.60
12/31/97 $174.13 $ 129.04 $163.86
</TABLE>
<TABLE>
<CAPTION>
JANUARY 28, MARCH 31, JUNE 30, SEPTEMBER 30, DECEMBER 31,
1997 1997 1997 1997 1997
----------- ----------- --------- ------------- ------------
<S> <C> <C> <C> <C> <C>
Southwest Bancorporation of Texas, Inc.......... $ 100.00 $ 107.69 $ 154.55 $ 165.04 $ 174.13
S&P 500 Composite Index......................... $ 100.00 $ 99.34 $ 116.69 $ 125.43 $ 129.04
SNL $1B--$5B Bank Index......................... $ 100.00 $ 102.96 $ 120.74 $ 139.60 $ 163.86
</TABLE>
12
<PAGE>
ITEM 2.
APPROVAL OF INCREASE IN SHARES ISSUABLE UNDER THE COMPANY'S
1996 STOCK OPTION PLAN
On February 23, 1998, the Board of Directors approved an amendment (the
"Amendment") to the Company's 1996 Stock Option Plan, increasing the number of
shares of Common Stock issuable thereunder from 650,000 shares to 1,000,000
shares, and recommended that the Amendment be submitted to the Company's
shareholders for approval at the Annual Meeting. The 1996 Stock Option Plan was
approved by the Company's shareholders on December 17, 1996. The following
summary of the material features of the 1996 Stock Option Plan is qualified in
its entirety by reference to the copy of the plan (as proposed to be amended)
attached hereto as Appendix A.
PURPOSE OF THE AMENDMENT
The Company believes that it has been able to attract highly qualified
personnel in part through the use of option grants, and that it is desirable to
have the continued flexibility to attract additional personnel, if needed, and
to retain and reward exceptional performance by employees through additional
option grants. The Company has used the 1996 Stock Option Plan and its
predecessor stock option plans (the "Predecessor Plans") for this purpose, and
as of March 31, 1998, options to purchase 1,261,669 shares of Common Stock
granted to 128 employees and non-employee directors (including options granted
to directors for the 1997 calendar year) were outstanding under the 1996 Stock
Option Plan, and the Predecessor Plans, with prices ranging from $.40 to $30.69
per share. As of March 31, 1998, no options remained available for grant under
the 1996 Stock Option Plan and no further options may be granted under the
Predecessor Plans. Accordingly, the Company is recommending that stockholders
approve the Amendment to the 1996 Stock Option Plan.
ADMINISTRATION
The Compensation Committee administers the 1996 Stock Option Plan and has
sole authority to select the employees and directors ("Optionees") eligible to
receive grants of options ("Options") that are either incentive stock options
("Incentive Stock Options") within the meaning of Section 422(b) of the Internal
Revenue Code of 1986, as amended (the "Code"), or options that do not constitute
incentive stock options ("Nonstatutory Stock Options") thereunder. The 1996
Stock Option Plan provides for the grant of options to acquire up to 650,000
shares of Common Stock (subject to certain adjustments in the event of stock
dividends, stock splits and certain other events ("adjustments")). The Committee
which administers the 1996 Stock Option Plan must be comprised solely of two or
more outside directors (within the meaning of Section 162(m) of the Code and
applicable interpretive authority thereunder). The Compensation Committee
selects the officers, key employees and non-employee directors of the Company to
whom options may be granted and determines the vesting and other terms of the
option agreements representing such options.
The exercise price of options granted under the 1996 Stock Option Plan is
determined by the Compensation Committee, but in the case of an Incentive Stock
Option, the exercise price shall not be less than the fair market value of the
Common Stock on the date the option is granted. No person may receive any
Incentive Stock Option if, at the time of grant such person owns directly or
indirectly more than 10% of the total combined voting power of the Company
unless the option price is at least 110% of the fair market value of the Common
Stock and the exercise period of such Incentive Stock Option is by its term
limited to five years. There is also a $100,000 limit on the value of stock
(determined at the time of grant) covered by Incentive Stock Options that first
become exercisable by an optionee in any calendar year. The maximum number of
shares subject to options that can be granted under the 1996 Stock Option Plan
to any executive officer or other employee of the Company or any subsidiary
during any calendar year is
13
<PAGE>
250,000 shares. No option may be granted more than ten years after the effective
date of the 1996 Stock Option Plan, which is November 18, 1996, the date of its
adoption by the Board of Directors.
Options granted under the 1996 Stock Option Plan may be accompanied by stock
appreciation rights ("SARs"). The grant of a SAR permits the optionee to
surrender an option and receive in exchange cash or, if specified in the option
agreement, shares of Common Stock with a value equal to the excess of the fair
market value of the stock subject to the option exercise price. None of the
options which have been granted under the 1996 Stock Option Plan are accompanied
by SARs.
AMENDMENT AND TERMINATION
The Board of Directors may amend or terminate the 1996 Stock Option Plan at
any time, except that (i) it may not make any change to a previously granted
Option which would impair the employee's rights without the employee's consent,
(ii) it may not decrease the authority granted to the Compensation Committee
under the Plan in contravention of Rule 16b-3 ("Rule 16b-3") promulgated under
the Securities Exchange Act of 1934, as amended (the "Exchange Act") and (iii)
it may not make any amendment which would materially increase the benefits
accruing to participants under the Plan, increase the aggregate number of shares
which may be issued pursuant to the provisions of the Plan, change the class of
individuals eligible to receive Options under the Plan or extend the term of the
Plan without the approval of the Company's shareholders. Except with respect to
Options then outstanding, if not sooner terminated, the 1996 Stock Option Plan
shall terminate and no further Options shall be granted after the expiration of
ten years from the date of its adoption.
TAX EFFECTS OF PARTICIPATION IN THE PLAN
STATUS OF OPTIONS. The federal income tax consequences both to the Optionee
and the Company of options granted under the 1996 Stock Option Plan differ
depending on whether an Option is an Incentive Stock Option or a Nonstatutory
Stock Option.
NONSTATUTORY STOCK OPTIONS. No federal income tax is imposed on the
Optionee upon the grant of a Nonstatutory Stock Option (whether or not including
an SAR). Generally, upon the exercise of a Nonstatutory Stock Option, the
Optionee will be treated as receiving compensation taxable as ordinary income in
the year of exercise, in an amount equal to the excess of the fair market value
of the shares at the time of exercise over the option price paid for such
shares. Upon a subsequent disposition of the shares received upon exercise of a
Nonstatutory Stock Option, any difference between the amount realized on the
disposition and the basis of the shares (option price plus any ordinary income
recognized) would be treated as long-term or short-term capital gain or loss,
depending on the holding period of the shares. Upon an Optionee's exercise of a
Nonstatutory Stock Option, the Company may claim a deduction for compensation
paid at the same time and in the same amount as compensation income is
recognized to the Optionee.
INCENTIVE STOCK OPTIONS. No federal income tax is imposed on the Optionee
upon the grant or exercise of an Incentive Stock Option. The difference between
the exercise price and the fair market value of the shares on the exercise date
will, however, be included in the calculation of the Optionee's alternative
minimum tax liability, if any. If the Optionee does not dispose of shares
acquired pursuant to the exercise of an Incentive Stock Option within two years
from the date the Option was granted or within one year after the shares were
transferred to him, no income is recognized by the Optionee by reason of the
exercise of the Option, and the difference between the amount realized upon a
subsequent disposition of the shares and the option price of the shares would be
treated as long-term capital gain or loss. In such event, the Company would not
be entitled to any deduction in connection with the grant or exercise of the
Option or the disposition of the shares so acquired.
If an Optionee disposes of shares acquired pursuant to his exercise of an
Incentive Stock Option prior to the end of the two-year or one-year holding
periods noted above, the disposition would be treated as a disqualifying
disposition and the Optionee would be treated as having received, at the time of
disposition,
14
<PAGE>
compensation taxable as ordinary income equal to the excess of the fair market
value of the shares at the time of exercise (or, in the case of a sale in which
a loss would be recognized, the amount realized on such sale, if less) over the
option price. Any amount realized in excess of the fair market value of the
shares at the time of exercise would be treated as long-term or short-term
capital gain, depending on the holding period of the shares. In such event, the
Company may claim a deduction for compensation paid at the same time and in the
same amount as compensation is treated as received by the Optionee.
STOCK APPRECIATION RIGHTS. No federal income tax is imposed on the Optionee
on the grant of an SAR. Upon the exercise of an SAR, the Optionee will be
treated as receiving compensation taxable as ordinary income in the year of
exercise, in an amount equal to the fair market value of the shares of Stock
plus the amount of any distributed to the Optionee. Upon a subsequent
disposition of the shares received upon exercise of an SAR, any difference
between the amount realized on the disposition and the basis of the shares (fair
market value at time of exercise) would be treated as long-term or short-term
capital gain or loss, depending on the holding period for the shares. Upon the
exercise of an SAR, the Company may claim a deduction for compensation paid at
the same time and in the same amount as compensation is recognized to the
Optionee.
PLAN BENEFITS
Because options under the 1996 Stock Option Plan are granted at the
discretion of the Compensation Committee, it is not possible for the Company to
determine and disclose the amount of options that may be granted to the Named
Executives and the executive officers as a whole, if the Amendment is approved.
SUMMARY AND RECOMMENDATION
The Amendment would provide for an additional 350,000 shares of Common Stock
to be made available to be issued upon the exercise of options granted under the
1996 Stock Option Plan, increasing the aggregate number of shares subject to the
1996 Stock Option Plan to 1,000,000 shares (subject to adjustments). Absent the
recommended increase, the usefulness of the 1996 Stock Option Plan as a
continuing source of employee incentives is severely impaired. Shares covered by
grants of stock options under the 1996 Stock Option Plan may be issued by the
Company from authorized but unissued stock, from shares previously issued and
reacquired by the Company, or any combination of such sources.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR APPROVAL OF THE PROPOSED
AMENDMENT TO THE COMPANY'S 1996 STOCK OPTION PLAN. Assuming the presence of a
quorum, the affirmative vote of a majority of the shares of Common Stock present
and entitled to vote on this item at the Annual Meeting is required to approve
the proposed Amendment.
ITEM 3.
APPOINTMENT OF AUDITORS
Pursuant to the recommendation of the Audit Committee, the Board of
Directors appointed Coopers & Lybrand L.L.P., independent public accountants, to
audit the consolidated financial statements of the Company for the year ending
December 31, 1998. Coopers & Lybrand L.L.P. has audited the Bank's financial
statements since 1983 and the Company's consolidated financial statements since
its inception in 1996. The Company is advised that no member of Coopers &
Lybrand L.L.P. has any direct or material indirect financial interest in the
Company or, during the past three years, has had any connection with the Company
in the capacity of promoter, underwriter, voting trustee, director, officer or
employee.
Ratification of this appointment shall be effective upon receiving the
affirmative vote of the holders of a majority of the Common Stock present or
represented by proxy and entitled to vote at the Annual Meeting. Under Texas
law, an abstention would have the same effect as a vote against this proposal,
but a broker non-vote would not be counted for purposes of determining whether a
majority had been achieved.
15
<PAGE>
THE BOARD OF DIRECTORS RECOMMENDS THAT SHAREHOLDERS VOTE "FOR" RATIFICATION
OF THIS APPOINTMENT.
In the event the appointment is not ratified, the Board of Directors will
consider the appointment of other independent auditors. A representative of
Coopers & Lybrand L.L.P. is expected to be present at the Annual Meeting, will
be offered the opportunity to make a statement if such representative desires to
do so and will be available to respond to appropriate questions.
ITEM 4.
OTHER MATTERS
The Board of Directors does not know of any other matters that are to be
presented for action at the Annual Meeting. However, if any other matters
properly come before the Annual Meeting or any adjournment(s) thereof, it is
intended that the enclosed proxy will be voted in accordance with the judgment
of the persons voting the proxy.
SHAREHOLDER PROPOSALS
Proposals of shareholders intended to be presented at the 1999 Annual
Meeting of Shareholders must be received by the Company at its principal
executive office by December 20, 1998, in order for such proposals to be
included in the Company' s proxy statement and form of proxy for such meeting.
Shareholders submitting such proposals are requested to address them to the
Secretary, Southwest Bancorporation of Texas, Inc., 4400 Post Oak Parkway,
Houston, Texas 77027.
In addition, the Company's Bylaws provide that only such business as is
properly brought before the Annual Meeting will be conducted. For business to be
properly brought before the meeting or nominations of persons for election to
the Board of Directors to be properly made at the Annual Meeting by a
shareholder, notice must be received by the Secretary at the Company's offices
not later than the close of business on the 70th day prior to the anniversary
date of the immediately preceding Annual Meeting; provided, however, that in the
event that the date of Annual Meeting is more than 20 days before such
anniversary date, such notice must be so delivered not later than the close of
business on the 10th day following the day on which public disclosure of the
date of such meeting is first made by the Company. Such notice to the Company
must also provide certain information set forth in the Bylaws. A copy of the
Bylaws may be obtained upon written request to the Secretary.
ALL SHAREHOLDERS ARE URGED TO COMPLETE, SIGN AND RETURN THE ACCOMPANYING
PROXY CARD IN THE ENCLOSED ENVELOPE.
By Order of the Board of Directors
David C. Farries
EXECUTIVE VICE PRESIDENT,
TREASURER AND SECRETARY
Houston, Texas
April 20, 1998
16
<PAGE>
APPENDIX A
SOUTHWEST BANCORPORATION OF TEXAS, INC.
1996 STOCK OPTION PLAN
(AS PROPOSED TO BE AMENDED)
I. PURPOSE OF THE PLAN
The SOUTHWEST BANCORPORATION OF TEXAS, INC. 1996 STOCK OPTION PLAN (the
"Plan") is intended to provide a means whereby certain employees of SOUTHWEST
BANCORPORATION OF TEXAS, INC., a Texas corporation (the "Company"), and its
subsidiaries may develop a sense of proprietorship and personal involvement in
the development and financial success of the Company, and to encourage them to
remain with and devote their best efforts to the business of the Company,
thereby advancing the interests of the Company and its shareholders.
Accordingly, the Company may grant to certain employees ("Optionees") the option
("Option") to purchase shares of the common stock, $1.00 par value, of the
Company ("Stock"), as hereinafter set forth. Options granted under the Plan may
be either incentive stock options, within the meaning of section 422(b) of the
Internal Revenue Code of 1986, as amended (the "Code"), ("Incentive Stock
Options") or options which do not constitute Incentive Stock Options.
II. ADMINISTRATION
The Plan shall be administered by a committee (the "Committee") of, and
appointed by, the Board of Directors of the Company (the "Board"), and the
Committee shall be (a) comprised solely of two or more outside directors (within
the meaning of section 162(m) of the Code and applicable interpretive authority
thereunder), and (b) constituted so as to permit the Plan to comply with Rule
16b-3, as currently in effect or as hereinafter modified or amended ("Rule
16b-3"), promulgated under the Securities Exchange Act of 1934, as amended (the
"1934 Act"). The Committee shall have sole authority to select the Optionees
from among those individuals eligible hereunder and to establish the number of
shares which may be issued under each Option; provided, however, that,
notwithstanding any provision in the Plan to the contrary, the maximum number of
shares that may be subject to Options granted under the Plan to an individual
Optionee during any calendar year may not exceed 250,000 (subject to adjustment
in the same manner as provided in Paragraph VIII hereof with respect to shares
of Stock subject to Options then outstanding). The limitation set forth in the
preceding sentence shall be applied in a manner which will permit compensation
generated under the Plan to constitute "performance-based" compensation for
purposes of section 162(m) of the Code, including, without limitation, counting
against such maximum number of shares, to the extent required under section
162(m) of the Code and applicable interpretive authority thereunder, any shares
subject to Options that are canceled or repriced. In selecting the Optionees
from among individuals eligible hereunder and in establishing the number of
shares that may be issued under each Option, the Committee may take into account
the nature of the services rendered by such individuals, their present and
potential contributions to the Company's success and such other factors as the
Committee in its discretion shall deem relevant. The Committee is authorized to
interpret the Plan and may from time to time adopt such rules and regulations,
consistent with the provisions of the Plan, as it may deem advisable to carry
out the Plan. All decisions made by the Committee in selecting the Optionees, in
establishing the number of shares which may be issued under each Option and in
construing the provisions of the Plan shall be final. If a Committee is not
appointed by the Board, the Board shall act as the Committee for purposes of the
Plan.
III. OPTION AGREEMENTS
(a) Each Option shall be evidenced by a written agreement between the
Company and the Optionee ("Option Agreement") which shall contain such terms and
conditions as may be approved by the Committee. The terms and conditions of the
respective Option Agreements need not be identical. Specifically, an Option
Agreement may provide for the surrender of the right to purchase shares under
the Option in return for a payment in cash or shares of Stock or a combination
of cash and shares of Stock
<PAGE>
equal in value to the excess of the fair market value of the shares with respect
to which the right to purchase is surrendered over the option price therefor
("Stock Appreciation Rights"), on such terms and conditions as the Committee in
its sole discretion may prescribe; provided, that, except as provided in
Subparagraph VIII(c) hereof, the Committee shall retain final authority (i) to
determine whether an Optionee shall be permitted, or (ii) to approve an election
by an Optionee, to receive cash in full or partial settlement of Stock
Appreciation Rights. Moreover, an Option Agreement may provide for the payment
of the option price, in whole or in part, by the delivery of a number of shares
of Stock (plus cash if necessary) having a fair market value equal to such
option price.
(b) For all purposes under the Plan, the fair market value of a share of
Stock on a particular date shall be equal to the mean of the high and low sales
prices of the Stock (i) reported by the National Market System of NASDAQ on that
date or (ii) if the Stock is listed on a national stock exchange, reported on
the stock exchange composite tape on that date; or, in either case, if no prices
are reported on that date, on the last preceding date on which such prices of
the Stock are so reported. If the Stock is traded over the counter at the time a
determination of its fair market value is required to be made hereunder, its
fair market value shall be deemed to be equal to the average between the
reported high and low or closing bid and asked prices of Stock on the most
recent date on which Stock was publicly traded. In the event Stock is not
publicly traded at the time a determination of its value is required to be made
hereunder, the determination of its fair market value shall be made by the
Committee in such manner as it deems appropriate.
(c) Each Option and all rights granted thereunder shall not be transferable
other than by will or the laws of descent and distribution or pursuant to a
qualified domestic relations order as defined by the Code or Title I of the
Employee Retirement Income Security Act of 1974, as amended, or the rules
thereunder, and shall be exercisable during the Optionee's lifetime only by the
Optionee or the Optionee's guardian or legal representative.
IV. ELIGIBILITY OF OPTIONEE
Options may be granted only to individuals who are employees (including
officers and directors who are also employees) of the Company or any parent or
subsidiary corporation (as defined in section 424 of the Code) of the Company at
the time the Option is granted; provided, however, that Options which do not
constitute Incentive Stock Options may be granted to individuals who are
directors (but not also employees) of the Company or any such parent or
subsidiary corporation. Options may be granted to the same individual on more
than one occasion. No Incentive Stock Option shall be granted to an individual
if, at the time the Option is granted, such individual owns stock possessing
more than 10% of the total combined voting power of all classes of stock of the
Company or of its parent or subsidiary corporation, within the meaning of
section 422(b)(6) of the Code, unless (i) at the time such Option is granted the
option price is at least 110% of the fair market value of the Stock subject to
the Option and (ii) such Option by its terms is not exercisable after the
expiration of five years from the date of grant. To the extent that the
aggregate fair market value (determined at the time the respective Incentive
Stock Option is granted) of stock with respect to which Incentive Stock Options
are exercisable for the first time by an individual during any calendar year
under all incentive stock option plans of the Company and its parent and
subsidiary corporations exceeds $100,000, such excess Incentive Stock Options
shall be treated as Options which do not constitute Incentive Stock Options. The
Committee shall determine, in accordance with applicable provisions of the Code,
Treasury Regulations and other administrative pronouncements, which of an
Optionee's Incentive Stock Options will not constitute Incentive Stock Options
because of such limitation and shall notify the Optionee of such determination
as soon as practicable after such determination.
A-2
<PAGE>
V. SHARES SUBJECT TO THE PLAN
The aggregate number of shares which may be issued under Options granted
under the Plan shall not exceed 1,000,000 shares of Stock. Such shares may
consist of authorized but unissued shares of Stock or previously issued shares
of Stock reacquired by the Company. Any of such shares which remain unissued and
which are not subject to outstanding Options at the termination of the Plan
shall cease to be subject to the Plan, but, until termination of the Plan, the
Company shall at all times make available a sufficient number of shares to meet
the requirements of the Plan. Should any Option hereunder expire or terminate
prior to its exercise in full, the shares theretofore subject to such Option may
again be subject to an Option granted under the Plan to the extent permitted
under Rule 16b-3. The aggregate number of shares which may be issued under the
Plan shall be subject to adjustment in the same manner as provided in Paragraph
VIII hereof with respect to shares of Stock subject to Options then outstanding.
Exercise of an Option in any manner, including an exercise involving a Stock
Appreciation Right, shall result in a decrease in the number of shares of Stock
which may thereafter be available, both for purposes of the Plan and for sale to
any one individual, by the number of shares as to which the Option is exercised.
Separate stock certificates shall be issued by the Company for those shares
acquired pursuant to the exercise of an Incentive Stock Option and for those
shares acquired pursuant to the exercise of any Option which does not constitute
an Incentive Stock Option.
VI. OPTION PRICE
The purchase price of Stock issued under each Option shall be determined by
the Committee, but in the case of an Incentive Stock Option, such purchase price
shall not be less than the fair market value of Stock subject to the Option on
the date the Option is granted.
VII. TERM OF PLAN
The Plan shall be effective upon the date of its adoption by the Board,
provided the Plan is approved by the shareholders of the Company within twelve
months thereafter. Notwithstanding any provision in this Plan or in any Option
Agreement, no Option shall be exercisable prior to such shareholder approval.
Except with respect to Options then outstanding, if not sooner terminated under
the provisions of Paragraph IX, the Plan shall terminate upon and no further
Options shall be granted after the expiration of ten years from the date of its
adoption by the Board.
VIII. RECAPITALIZATION OR REORGANIZATION
(a) The existence of the Plan and the Options granted hereunder shall not
affect in any way the right or power of the Board or the shareholders of the
Company to make or authorize any adjustment, recapitalization, reorganization or
other change in the Company's capital structure or its business, any merger or
consolidation of the Company, any issue of debt or equity securities, the
dissolution or liquidation of the Company or any sale, lease, exchange or other
disposition of all or any part of its assets or business or any other corporate
act or proceeding.
(b) The shares with respect to which Options may be granted are shares of
Stock as presently constituted, but if, and whenever, prior to the expiration of
an Option theretofore granted, the Company shall effect a subdivision or
consolidation of shares of Stock or the payment of a stock dividend on Stock
without receipt of consideration by the Company, the number of shares of Stock
with respect to which such Option may thereafter be exercised (i) in the event
of an increase in the number of outstanding shares shall be proportionately
increased, and the purchase price per share shall be proportionately reduced,
and (ii) in the event of a reduction in the number of outstanding shares shall
be proportionately reduced, and the purchase price per share shall be
proportionately increased.
A-3
<PAGE>
(c) If the Company recapitalizes, reclassifies its capital stock, or
otherwise changes its capital structure (a "recapitalization"), the number and
class of shares of Stock covered by an option theretofore granted shall be
adjusted so that such Option shall thereafter cover the number and class of
shares of stock and securities to which the Optionee would have been entitled
pursuant to the terms of the recapitalization if, immediately prior to the
recapitalization, the Optionee had been the holder of record of the number of
shares of Stock then covered by such Option. If (i) the Company shall not be the
surviving entity in any merger, consolidation or other reorganization (or
survives only as a subsidiary of an entity), (ii) the Company sells, leases or
exchanges all or substantially all of its assets to any other person or entity,
(iii) the Company is to be dissolved and liquidated, (iv) any person or entity,
including a "group" as contemplated by Section 13(d)(3) of the 1934 Act,
acquires or gains ownership or control (including, without limitation, power to
vote) of more than 50% of the outstanding shares of the Company's voting stock
(based upon voting power), or (v) as a result of or in connection with a
contested election of directors, the persons who were directors of the Company
before such election shall cease to constitute a majority of the Board (each
such event is referred to herein as a "Corporate Change"), then all outstanding
Options shall fully vest and become fully exercisable, effective as of the first
business day immediately preceding the effective date of such Corporate Change
(or as of an earlier date determined by the Committee pursuant to the following
clause); provided, however, that, subject to such acceleration of vesting of the
outstanding Options, no later than (a) ten days after the approval by the
shareholders of the Company of such merger, consolidation, reorganization, sale,
lease or exchange of assets or dissolution or such election of directors or (b)
thirty days after a change of control of the type described in Clause (iv), the
Committee, acting in its sole discretion without the consent or approval of any
Optionee, may, in its discretion, also act to effect one or more of the
following alternatives, which may vary among individual Optionees and which may
vary among Options held by any individual Optionee: (1) provide that the Options
may be exercised in full only for a limited period of time on or before a
specified date (before or after such Corporate Change) fixed by the Committee,
after which specified date all unexercised Options and all rights of Optionees
thereunder shall terminate, (2) require the mandatory surrender to the Company
by selected Optionees of some or all of the outstanding Options held by such
Optionees as of a date, before or after such Corporate Change, specified by the
Committee, in which event the Committee shall thereupon cancel such Options and
the Company shall pay to each Optionee an amount of cash per share equal to the
excess, if any, of the amount calculated in Subparagraph (d) below (the "Change
of Control Value") of the shares subject to such Option over the exercise
price(s) under such Options for such shares, (3) make such adjustments (other
than vesting) to Options then outstanding as the Committee deems appropriate to
reflect such Corporate Change or (4) provide that the number and class of shares
of Stock covered by an Option theretofore granted shall be adjusted so that such
Option shall thereafter cover the number and class of shares of stock or other
securities or property (including, without limitation, cash) to which the
Optionee would have been entitled pursuant to the terms of the agreement of
merger, consolidation or sale of assets and dissolution if, immediately prior to
such merger, consolidation or sale of assets and dissolution, the Optionee had
been the holder of record of the number of shares of Stock then covered by such
Option.
(d) For the purposes of clause (2) in Subparagraph (c) above, the "Change of
Control Value" shall equal the amount determined in clause (i), (ii) or (iii),
whichever is applicable, as follows: (i) the per share price offered to
shareholders of the Company in any such merger, consolidation, reorganization,
sale of assets or dissolution transaction, (ii) the price per share offered to
shareholders of the Company in any tender offer or exchange offer whereby a
Corporate Change takes place, or (iii) if such Corporate Change occurs other
than pursuant to a tender or exchange offer, the fair market value per share of
the shares into which such Options being surrendered are exercisable, as
determined by the Committee as of the date determined by the Committee to be the
date of cancellation and surrender of such Options. In the event that the
consideration offered to shareholders of the Company in any transaction
described in this Subparagraph (d) or Subparagraph (c) above consists of
anything other than cash, the Committee shall determine the fair cash equivalent
of the portion of the consideration offered which is other than cash.
A-4
<PAGE>
(e) Any adjustment provided for in Subparagraphs (b) or (c) above shall be
subject to any required shareholder action.
(f) Except as hereinbefore expressly provided, the issuance by the Company
of shares of stock of any class or securities convertible into shares of stock
of any class, for cash, property, labor or services, upon direct sale, upon the
exercise of rights or warrants to subscribe therefor, or upon conversion of
shares or obligations of the Company convertible into such shares or other
securities, and in any case whether or not for fair value, shall not affect, and
no adjustment by reason thereof shall be made with respect to, the number of
shares of Stock subject to Options theretofore granted or the purchase price per
share.
IX. AMENDMENT OR TERMINATION OF THE PLAN
The Board in its discretion may terminate the Plan at any time with respect
to any shares for which Options have not theretofore been granted. The Board
shall have the right to alter or amend the Plan or any part thereof from time to
time; provided, that no change in any Option theretofore granted may be made
which would impair the rights of the Optionee without the consent of such
Optionee; and provided, further, that (i) the Board may not make any alteration
or amendment which would decrease any authority granted to the Committee
hereunder in contravention of Rule 16b-3 and (ii) the Board may not make any
alteration or amendment which would materially increase the benefits accruing to
participants under the Plan, increase the aggregate number of shares which may
be issued pursuant to the provisions of the Plan, change the class of
individuals eligible to receive Options under the Plan or extend the term of the
Plan, without the approval of the shareholders of the Company.
X. SECURITIES LAWS
(a) The Company shall not be obligated to issue any Stock pursuant to any
Option granted under the Plan at any time when the offering of the shares
covered by such Option have not been registered under the Securities Act of 1933
and such other state and federal laws, rules or regulations as the Company or
the Committee deems applicable and, in the opinion of legal counsel for the
Company, there is no exemption from the registration requirements of such laws,
rules or regulations available for the offering and sale of such shares.
It is intended that the Plan and any grant of an Option made to a person
subject to Section 16 of the 1934 Act meet all of the requirements of Rule
16b-3. If any provision of the Plan or any such Option would disqualify the Plan
or such Option under, or would otherwise not comply with, Rule 16b-3, such
provision or Option shall be construed or deemed amended to conform to Rule
16b-3.
A-5
<PAGE>
PROXY PROXY
SOUTHWEST BANCORPORATION OF TEXAS, INC.
PROXY FOR 1998 ANNUAL MEETING OF SHAREHOLDERS
THIS PROXY IS SOLICITED BY THE BOARD OF DIRECTORS
The undersigned hereby appoints Walter E. Johnson, John W. Johnson and
David C. Farries, and each of them, with or without the others, with full
power of substitution, to vote all shares of stock that the undersigned is
entitled to vote at the 1998 Annual Meeting of Shareholders of Southwest
Bancorporation of Texas, Inc. (the "Company"), to be held at 4400 Post Oak
Parkway, Houston, Texas, on May 26, 1998, at 10:30 a.m. (Houston time) and
all adjournments and postponements thereof as follows:
<TABLE>
<S> <C> <C> <C>
1. ELECTION OF DIRECTORS: / / FOR all nominees listed below / / WITHHOLD AUTHORITY
(except as marked to the contrary below) to vote for all nominees listed below
<CAPTION>
1.
<CAPTION>
</TABLE>
INSTRUCTION: TO WITHHOLD AUTHORITY FOR ANY INDIVIDUAL NOMINEE, MARK A
LINE THROUGH THE NOMINEE'S NAME IN THE LIST BELOW.
<TABLE>
<S> <C> <C>
Ernest H. Cockrell Paul B. Murphy, Jr. Michael T. Willis
Adolph A. Pfeffer, Jr. Stanley D. Stearns, Jr.
</TABLE>
2. Proposal to amend the Company's 1996 Stock Option Plan to increase
the number of shares of Common Stock issuable thereunder from 650,000
shares to 1,000,000 shares.
/ / FOR / / AGAINST / / ABSTAIN
3. Proposal to ratify the appointment of Coopers & Lybrand L.L.P. as
independent public accountants for the year ended December 31, 1998.
/ / FOR / / AGAINST / / ABSTAIN
(CONTINUED ON REVERSE SIDE)
<PAGE>
(CONTINUED FROM OTHER SIDE)
4. In their discretion, upon any other business as may properly come before
said meeting.
This proxy will be voted as you specify above. If no specification is made,
this Proxy will be voted with respect to item (1) FOR the nominees listed, with
respect to item (2) FOR the proposal to amend the Company's 1996 Stock Option
Plan, and with respect to item (3) FOR ratification of the appointment of
Coopers & Lybrand L.L.P. as independent accountants for the year ended December
31, 1998. The undersigned hereby acknowledges receipt of the Notice of the 1998
Annual Meeting and related Proxy Statement and the Company's 1997 Annual Report
to Shareholders.
Dated _________________________ , 1998
______________________________________
______________________________________
Stockholder's Signature(s)
______________________________________
Signature if held jointly
NOTE: Joint owners must each sign.
Please sign your name exactly as it
appears on your stock certificate.
When signing as attorney, executor,
administrator, trustee or guardian,
please give full title. If held by a
corporation, please sign in the full
corporate name by the president or
other authorized officer.
(PLEASE RETURN THIS SIGNED PROXY CARD IN THE ACCOMPANYING ADDRESSED ENVELOPE)
