SCHEDULE 14A
(Rule 14a-101)
INFORMATION REQUIRED IN PROXY STATEMENT
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
[X] Definitive Proxy Statement Commission Only (as permitted by
[ ] Definitive Additional Materials Rule 14a-6(e)(2))
[ ] Soliciting Material Pursuant to
Rule 14a-11(c) or Rule 14a-12
WESTAMERICA BANCORPORATION
----------------------------------------------------------
(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)(4) and 0-11.
(1) Title of each class of securities to which transactions applies:
(2) Aggregate number of securities to which transactions 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:
<PAGE>
[WESTAMERICA BANCORPORATION LOGO]
1108 Fifth Avenue
San Rafael, California 94901
March 20, 2000
To Our Shareholders:
The Annual Meeting of Shareholders of Westamerica Bancorporation will
be held at 2:00 p.m. on Thursday, April 27, 2000, at the Fairfield Center for
Creative Arts, 1035 West Texas Street, Fairfield, CA, as stated in the formal
notice accompanying this letter. We hope you will plan to attend.
At the Annual Meeting, the shareholders will be asked to elect
directors and to approve the selection of independent auditors.
Please sign and return the enclosed proxy as promptly as possible so
that your shares may be represented at the Annual Meeting. If you attend, you
may vote in person even though you previously returned your proxy.
We look forward to seeing you at the Annual Meeting on Thursday, April
27, 2000, at the Fairfield Center for Creative Arts, Fairfield, California.
Sincerely,
/s/ DAVID L. PAYNE
----------------------------------------
DAVID L. PAYNE
Chairman of the Board, President
and Chief Executive Officer
<PAGE>
WESTAMERICA BANCORPORATION
1108 Fifth Avenue
San Rafael, California 94901
------------
Notice of Annual Meeting of Shareholders--April 27, 2000
To the Shareholders of WESTAMERICA BANCORPORATION:
The Annual Meeting of Shareholders will be held at the Fairfield Center
for Creative Arts, Fairfield, California, on Thursday, April 27, 2000, at 2:00
p.m. for the purpose of:
1. Electing 13 directors;
2. Approving the selection of independent auditors for 2000; and
3. Transacting such other business as may properly come before the
Annual Meeting.
Shareholders of record at the close of business on February 25, 2000,
are entitled to notice of and to vote at the Annual Meeting or any postponement
or adjournment thereof. You are cordially invited to attend the Annual Meeting.
If you do not expect to be present, please complete, sign and date the
accompanying proxy and mail it at once in the enclosed envelope. No postage is
necessary if mailed within the United States.
Westamerica Bancorporation's Annual Report for the fiscal year ended
December 31, 1999 is enclosed. The Annual Report contains financial and other
information about the activities of Westamerica Bancorporation, but it is not to
be deemed a part of the proxy soliciting materials.
BY ORDER OF THE BOARD OF DIRECTORS
/s/ Kris Irvine
----------------------------------------
Kris Irvine
Assistant Corporate Secretary
Dated: March 20, 2000
- --------------------------------------------------------------------------------
YOUR VOTE IS IMPORTANT
YOU ARE URGED TO COMPLETE, SIGN, DATE AND PROMPTLY RETURN YOUR PROXY
SO THAT YOUR SHARES MAY BE VOTED IN ACCORDANCE WITH YOUR WISHES.
<PAGE>
TABLE OF CONTENTS
Page
----
GENERAL ................................................................... 1
ELECTION OF DIRECTORS ..................................................... 2
CERTAIN INFORMATION ABOUT THE BOARD OF DIRECTORS AND
CERTAIN COMMITTEES OF THE BOARD .......................................... 4
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS
AND MANAGEMENT ........................................................... 5
EXECUTIVE COMPENSATION .................................................... 7
OTHER ARRANGEMENTS ........................................................ 9
BOARD COMPENSATION COMMITTEE REPORT ....................................... 10
TOTAL RETURN PERFORMANCE CHART ............................................ 13
APPROVAL OF AUDITORS ...................................................... 13
OTHER MATTERS ............................................................. 14
i
<PAGE>
WESTAMERICA BANCORPORATION
1108 Fifth Avenue
San Rafael, California 94901
------------
PROXY STATEMENT
March 20, 2000
------------
GENERAL
This proxy statement is furnished in connection with the solicitation
of proxies by the Board of Directors (the "Board") of Westamerica Bancorporation
(the "Corporation") for use at the Annual Meeting of Shareholders to be held at
2:00 p.m., Thursday, April 27, 2000, at the Fairfield Center for Creative Arts,
Fairfield, California, for the purposes set forth in the accompanying Notice of
Annual Meeting of Shareholders (the "Meeting"). This proxy statement and proxy
are being mailed to shareholders on or about March 20, 2000.
Voting Rights and Vote Required. Shareholders of record of the
Corporation's common stock at the close of business on February 25, 2000, the
record date, are entitled to vote at the Meeting. On that date, approximately
36,574,930 shares of the Corporation's common stock were outstanding. The
determination of shareholders entitled to vote at the Meeting and the number of
votes to which they are entitled was made on the basis of the Corporation's
records as of the record date.
Each share is entitled to one vote, except that with respect to the
election of directors, a shareholder may cumulate votes as to candidates
nominated prior to voting if any shareholder gives notice of intent to cumulate
votes at the Meeting prior to the voting. If any shareholder gives such notice,
all shareholders may cumulate their votes for nominees. Under cumulative voting,
each share carries as many votes as the number of directors to be elected, and
the shareholder may cast all of such votes for a single nominee or distribute
them in any manner among as many nominees as desired.
In the election of directors, the 13 nominees receiving the highest
number of votes will be elected. Approval of the selection of the independent
auditors will require the affirmative vote of a majority of the shares
represented and voting at the Meeting. Abstentions will not count as votes in
favor of the election of directors or any of the other proposals.
Quorum. A majority of the shares entitled to vote, represented either
in person or by a properly executed proxy, will constitute a quorum at the
Meeting. Shares which abstain from voting and "broker non-votes" (shares as to
which brokerage firms have not received voting instructions from their clients
and therefore do not have the authority to vote the shares at the Meeting) will
be counted for purposes of determining a quorum only.
Voting of Proxies. The shares represented by all properly executed
proxies received in time for the Meeting will be voted in accordance with the
shareholders' choices specified therein; provided, however, that where no
choices have been specified, the shares will be voted to approve the selection
of KPMG LLP as independent auditors. When exercising the powers granted to proxy
holders under the caption "ELECTION OF DIRECTORS," the shares will be voted for
the election of directors in the manner described therein.
The Board knows of no matters to be brought before the Meeting other
than the election of directors and the selection of independent auditors for
2000. If, however, any other matters of which the Board is not now aware are
properly presented for action, it is the intention of the proxy holders named in
the enclosed form of proxy to vote such proxy on such matters in accordance with
their best business judgment.
1
<PAGE>
Revocability of Proxy. The delivery of the enclosed proxy does not
preclude the shareholder delivering the proxy from voting in person or changing
the proxy should the shareholder so desire. The proxy may be revoked by a
written directive to the Corporation, by another proxy subsequently executed and
presented at the Meeting at any time prior to the actual voting or by attendance
and voting at the Meeting.
Shareholder Proposals. To be considered for inclusion in the
Corporation's proxy statement for next year's annual meeting, shareholder
proposals must be received at the Corporation's executive offices at 1108 Fifth
Avenue, San Rafael, California 94901, no later than November 20, 2000.
ELECTION OF DIRECTORS
The number of directors of the Board to be elected at the Meeting to
hold office for the ensuing year and until their successors are elected and
qualified is 13. It is the intention of the proxy holders named in the enclosed
proxy to vote such proxies (except those containing contrary instructions) for
the 13 nominees named below. The Board does not anticipate that any of the
nominees will be unable to serve as a director, but if that should occur before
the Meeting, the proxy holders reserve the right to substitute another person as
nominee and vote for such person of their choice in the place and stead of any
nominee unable so to serve. The proxy holders reserve the right to cumulate
votes for the election of directors and cast all of such votes for any one or
more of the nominees, to the exclusion of the others, and in such order of
preference as the proxy holders may determine in their discretion.
<TABLE>
Nominees. The nominees for election to the office of director of the
Board are named and certain information with respect to them is given below. The
information has been furnished to the Corporation by the respective nominees.
All of the nominees have engaged in their indicated principal occupation for
more than five years, unless otherwise indicated.
<CAPTION>
Director
Name of Nominee Principal Occupation Since
- --------------------------- --------------------------------------------------------------- ----------
<S> <C> <C>
Etta Allen ............... Mrs. Allen, born in 1929, is President and owner 1988
of Allen Heating and Sheet Metal of Greenbrae,
California, and President and owner of Sunny Slope
Vineyard, Glen Ellen, CA.
Louis E. Bartolini ....... Mr. Bartolini, born in 1932, retired in 1988 as a 1991
Vice President and financial consultant with
Merrill Lynch, Pierce, Fen- ner & Smith, Inc. He
currently devotes some of his time to serving on
various community service boards.
Don Emerson .............. Mr. Emerson, born in 1928, was President of Calso 1979
Company (the holding company that owns the formula
and name "Calso Water," a carbonated mineral
water) through 1981. He presently devotes his time
to personal investments.
Louis H. Herwaldt........ Mr. Herwaldt, born in 1932, is Chief Executive 1997
Officer of Herwaldt Automotive Group, Inc. Prior
to 1996, Mr. Herwaldt had been President of
Herwaldt Oldsmobile-GMC Truck since 1969,
President of Saturn of Fresno since 1991, and
President of Herwaldt Motors since 1993. Mr.
Herwaldt served as a director of ValliCorp
Holdings, Inc., which merged with and into the
Corporation in 1997.
2
<PAGE>
Director
Name of Nominee Principal Occupation Since
- --------------------------- --------------------------------------------------------------- ----------
<S> <C> <C>
Arthur C. Latno, Jr. ...... Mr. Latno, born in 1929, was an Executive Vice 1985
President for Pacific Telesis Group (formerly
Pacific Telephone Co.) in San Francisco, CA. Mr.
Latno retired from that company in November of
1992. He currently devotes some of his time to
serving on various community service boards.
Patrick D. Lynch ........... Mr. Lynch, born in 1933, currently serves as a 1986
consultant to several private high technology
firms.
Catherine Cope
MacMillan ................ Ms. MacMillan, born in 1947, is General Counsel 1985
for Nob Hill Properties, Inc., the owner of the
Huntington Hotel in San Francisco, CA. Prior to
1999 she was President and owner of the Firehouse
Restaurant in Sacramento, CA.
Patrick J. Mon Pere ....... Mr. Mon Pere, born in 1931, is the owner and 1997
President/Chief Executive Officer of Patrick James
Inc., a men's retail cloth- ing firm. Mr. Mon Pere
served as a director of ValliCorp Holdings, Inc.,
which merged with and into the Corporation in
1997.
Ronald A. Nelson ........... Schulz Creative Associates, a general partner in 1988
various Schulz partnerships and trustee for
various Schulz trusts and the Schulz Foundation
through 1995. He now devotes his time to personal
investments.
Carl R. Otto .............. Mr. Otto, born in 1946, is the President and Chief 1992
Executive Officer of John F. Otto, Inc., a general
contracting firm in Sacramento, CA.
David L. Payne ............ Mr. Payne, born in 1955, is the Chairman of the 1984
Board, President and Chief Executive Officer of
the Corporation. Mr. Payne is President and Chief
Executive Officer of Gibson Printing and
Publishing Company and Gibson Radio and Publishing
Company, which are newspaper, commercial printing
and real estate investment companies headquartered
in Vallejo, CA.
Michael J. Ryan, Jr ........ Mr. Ryan, born in 1930, has been involved in Ryan 1997
Farms, a diversified farming venture, as well as
investments and real estate since 1957. Mr. Ryan
served as a director of ValliCorp Holdings, Inc.,
which merged with and into the Corporation in
1997.
Edward B. Sylvester ........ Mr. Sylvester, born in 1936, is the President of 1979
Sylvester Engineering, Inc., a civil engineering
and planning firm with offices in Nevada City and
Truckee, California.
</TABLE>
3
<PAGE>
CERTAIN INFORMATION ABOUT THE BOARD OF DIRECTORS
AND CERTAIN COMMITTEES OF THE BOARD
The Board held a total of 13 meetings during 1999. Every director
attended at least 75% of the aggregate of: (i) the 13 Board meetings or that
number of Board meetings held during the period in which they served; and (ii)
the total number of meetings of any Committee of the Board on which such
director served.
Committees of the Board. The Board has an Executive Committee, the
members of which are D. L. Payne, Chairman; D. Emerson, A. C. Latno, Jr., P. D.
Lynch and E. B. Sylvester. The Board delegates to the Executive Committee,
subject to the limitations of the California General Corporation Law, any powers
and authority of the Board in the management of the business and affairs of the
Corporation. The Executive Committee held 12 meetings in 1999.
The Board has an Audit Committee, the members of which are R. A.
Nelson, Chairman; L. E. Bartolini, C. C. MacMillan, P. J. Mon Pere and C. R.
Otto. The Audit Committee reviews with the Corporation's independent auditors
and management the Corporation's accounting principles, policies and practices
and its reporting policies and practices. The Audit Committee reviews with the
independent auditors the plan and results of the auditing engagement and reviews
the scope and results of the procedures of the Corporation's internal Audit
Department. The Audit Committee reviews the adequacy of the Corporation's
internal accounting procedures with the Corporation's internal audit staff and
with the Board. The Audit Committee reviews the reports of examinations
conducted by bank regulatory authorities. The Audit Committee held five meetings
in 1999.
The Board has an Employee Benefits and Compensation Committee, the
members of which are P. D. Lynch, Chairman; E. Allen, D. Emerson, R. A. Nelson
and M. J. Ryan, Jr. The Employee Benefits and Compensation Committee administers
and carries out the terms of the Corporation's employee stock option plans as
well as the tax deferred savings and retirement and profit-sharing plans. The
Employee Benefits and Compensation Committee administers the Corporation's
compensation programs and reviews and recommends to the Board the compensation
level for the executive officers of the Corporation and its subsidiaries. The
Employee Benefits and Compensation Committee also reviews the performance of and
recommends promotions for the executive officers of the Corporation. The
Employee Benefits and Compensation Committee held five meetings in 1999.
The Board has a Nominating Committee for the election of directors, the
members of which are A. C. Latno, Chairman; D. Emerson, Jr., P. D. Lynch, D. L.
Payne and E. B. Sylvester. The Nominating Committee is responsible for reviewing
the fees paid to directors for attendance at Board and Committee meetings and
making recommendations with respect thereto. The Nominating Committee will
consider shareholder nominations for election to the Board submitted in
accordance with section 2.14 of the Bylaws of the Corporation ("Section 2.14").
Section 2.14 requires that nominations be submitted in writing to the Secretary
(or Assistant Secretary) of the Corporation within not less than 14 days nor
more than 50 days prior to any meeting at which directors will be elected and
that nominations contain certain specified information regarding the nominee and
the nominating shareholder. Nominations not made in accordance with Section 2.14
may be disregarded by the chairperson of the Meeting in his or her sole
discretion. The Nominating Committee held one meeting in 1999.
The Board has a Loan and Investment Committee, the members of which are
E. B. Sylvester, Chairman; E. Allen, L. H. Herwaldt, A. C. Latno, Jr. and C. C.
MacMillan. The Loan and Investment Committee is responsible for reviewing major
loans and investment policies and for monitoring the activities related to the
Community Reinvestment Act. The Loan and Investment Committee held 12 meetings
in 1999.
Directors' Fees. During 1999, non-employee directors of the Corporation
received an annual retainer of $14,000. Each director received $1,000 for each
meeting of the Board that he or she attended.
During 1999, each non-employee director received $500 for each
Committee meeting of the Board attended. The Chairman of each Committee received
an additional $250, for a total of $750, for each Committee meeting attended.
The Chairman of the Board, D. L. Payne, is compensated as an employee and did
not receive an annual retainer or directors' fees.
4
<PAGE>
Indebtedness of Directors and Management. Certain of the directors,
executive officers and their associates have had banking transactions with
subsidiaries of the Corporation in the ordinary course of business. All
outstanding loans and commitments included in such transactions were made on
substantially the same terms, including interest rates and collateral, as those
prevailing at the time for comparable transactions with other persons, did not
involve more than a normal risk of collectibility and did not present other
unfavorable features.
SECURITY OWNERSHIP OF CERTAIN
BENEFICIAL OWNERS AND MANAGEMENT
Security Ownership of Certain Beneficial Owners. To the best knowledge
of the Corporation, as of the date of this proxy statement, no person or entity
was the beneficial owner of more than 5% of the Corporation's outstanding
shares. For the purpose of this disclosure and the disclosure of ownership of
shares by management below, shares are considered to be "beneficially" owned if
the person, directly or indirectly, has or shares the power to vote or direct
the voting of the shares, the power to dispose of or direct the disposition of
the shares, or the right to acquire beneficial ownership (as so defined) within
60 days of February 25, 2000.
<TABLE>
Security Ownership of Directors and Management. The following table
shows the number of common shares and the percentage of the common shares
beneficially owned (as defined above) by each of the current directors, by each
of the nominees for election to the office of director, by the Chief Executive
Officer and the four other most highly compensated executive officers during
1999 and by all directors and executive officers of the Corporation as a group
as of February 25, 2000.
<CAPTION>
Amount and Nature of Beneficial Ownership
----------------------------------------------------------------
Sole Shared Voting Right to
Voting and and Acquire Within % of
Investment Investment 60 Days of Shares of
Name Power Power Feb 25, 2000(1) Total Class(2)
- ------------------------------- ------------ --------------- ----------------- ----------- -----------
<S> <C> <C> <C> <C> <C>
Etta Allen(3) ................... 10,683 10,683 *
Louis E. Bartolini .............. 1,800 1,800 *
Don Emerson ..................... 68,650 68,650 0.2%
Louis H. Herwaldt ............... 30,000 30,000 *
Arthur C. Latno, Jr.(4) ......... 3,181 3,181 *
Patrick D. Lynch ................ 1,000 1,000 *
Catherine Cope MacMillan(5) ..... 3,006 3,006 *
Patrick J. Mon Pere ............. 220,829 9,909 230,738 0.6%
Ronald A. Nelson ................ 44,000 44,000 0.1%
Carl R. Otto .................... 6,000 6,000 *
David L. Payne(6) ............... 607,105 11,062 560,690 1,178,857 3.2%
Michael J. Ryan, Jr.(7) ......... 56,785 9,387 66,172 0.2%
Edward B. Sylvester ............. 82,500 82,500 0.2%
Jennifer J. Finger .............. 76 575 17,170 17,821 *
Robert W. Entwisle(8) ........... 1,535 306 145,440 147,281 0.4%
Hans T. Y. Tjian(9) ............. 85,055 17,091 163,660 265,806 0.7%
Thomas S. Lenz(10) .............. 2,180 218 45,757 48,155 0.1%
All 20 Directors and Executive
Officers as a Group ............ 1,271,553 44,537 1,129,393 2,445,483 6.7%
<FN>
- ------------
* Indicates that the percentage of the outstanding shares beneficially owned
is less than one-tenth of one percent (0.1%).
(1) During 1996, the Corporation adopted the Westamerica Bancorporation
Deferral Plan that allows recipients of restricted performance shares to
defer income into succeeding years. The plan includes restricted
performance shares vested as of January 27, 2000, whether or not deferred
by the executive into the Westamerica Bancorporation Deferral Plan.
5
<PAGE>
(2) In calculating the percentage of ownership, all shares which the identified
person or persons have the right to acquire by exercise of options are
deemed to be outstanding for the purpose of computing the percentage of the
class owned by such person, but are not deemed to be outstanding for the
purpose of computing the percentage of the class owned by any other person.
(3) Includes 10,350 shares held in a trust as to which Mrs. Allen is trustee.
(4) Includes 1,200 shares owned by Mr. Latno's wife, as to which Mr. Latno
disclaims beneficial ownership.
(5) Includes 2,100 shares held in a trust as to which Ms. MacMillan is trustee.
(6) Includes 528,837 shares owned by Gibson Radio and Publishing Company, of
which Mr. Payne is President and Chief Executive Officer, as to which Mr.
Payne disclaims beneficial ownership.
(7) Held in a trust, as to which Mr. Ryan is co-trustee with sole voting and
investment power.
(8) Includes five shares held in a trust as to which Mr. Entwisle is co-trustee
with sole voting and investment power.
(9) Held in a trust, as to which Mr. Tjian is co-trustee with sole voting and
investment power.
(10) Held in a trust, as to which Mr. Lenz is co-trustee with sole voting and
investment power.
</FN>
</TABLE>
Section 16(a) Beneficial Ownership Reporting Compliance
Section 16(a) of the Securities Exchange Act of 1934, as amended (the
"Exchange Act") requires the Corporation's directors and executive officers and
persons who own 10% or more of a registered class of the Corporation's equity
securities to file with the Securities and Exchange Commission (the "SEC") and
the National Association of Securities Dealers initial reports of ownership and
reports of changes in ownership of Common Stock and other equity securities of
the Corporation. Such persons are required by SEC regulation to furnish the
Corporation with copies of all Section 16(a) forms they file.
To the Corporation's knowledge, based solely on a review of the copies
of such reports furnished to the Corporation and written representations that no
other reports were required, during the fiscal year ended December 31, 1999, all
Section 16(a) filing requirements applicable to its officers, directors and 10%
shareholders were complied with.
6
<PAGE>
EXECUTIVE COMPENSATION
The following Summary Compensation Table sets forth the compensation of
the Corporation's Chief Executive Officer and the four other most highly
compensated executive officers for services in all capacities to the
Corporation, Westamerica Bank ("WAB") and other subsidiaries during 1999, 1998
and 1997:
<TABLE>
SUMMARY COMPENSATION TABLE
<CAPTION>
Annual Compensation Long-Term Compensation
------------------------------------------ --------------------------
Name and Restricted Securities
Principal Stock Underlying All Other
Position Year Salary Bonus(1) Other(2) Awards(3)(4) Options(3) Compensation(5)
-------- ---- ------ -------- -------- ------------ ---------- ---------------
<S> <C> <C> <C> <C> <C> <C> <C>
David L. Payne, 1999 $272,016 $ 350,000 $ 1,440 $ 0 192,090 $ 270,494(6)(7)
Chairman, 1998 272,016 300,000 1,089 0 192,090 32,391(6)
President & CEO 1997 272,016 300,000 1,200 0 96,000 32,743(6)
Jennifer J. Finger,(8) 1999 $129,984 $ 91,200 $ 0 $ 133,747 25,770 $ 17,354
SVP & CFO 1998 129,988 86,600 0 48,201 0 27,816(9)
1997 42,915 28,800 0 0 0 3,473(9)
Robert W. Entwisle, 1999 $134,280 $ 73,700 $12,000 $ 120,269 23,220 $ 18,511
SVP 1998 134,280 75,500 13,089 130,832 23,220 18,511
1997 134,280 72,300 13,096 120,698 25,800 18,354
Hans T. Y. Tjian, 1999 $130,008 $ 101,900 $12,000 $ 108,518 20,910 $ 19,429
SVP 1998 130,008 74,200 12,000 117,060 20,910 20,255
1997 130,008 75,600 12,000 108,570 23,250 19,850
Thomas S. Lenz 1999 $120,960 $ 68,000 $ 0 $ 68,429 14,660 $ 12,682
SVP & Chief Credit 1998 105,360 59,500 0 66,892 13,200 9,227
Administrator 1997 98,160 53,800 0 60,060 12,600 17,899
<FN>
- ------------
(1) Includes bonuses in the year in which they were earned.
(2) Includes monthly auto allowance for each individual and the amount of any
taxable perquisites.
(3) The Corporation grants restricted performance shares and stock options in
the first quarter of each year based on corporate performance in the prior
calendar year. As with all outstanding shares of common stock, dividends
are paid on vested restricted performance shares. At December 31, 1999
these individuals held the following unvested restricted performance shares
with the following fair market values, based on a price of $27.94 per
share: Finger (5,340 shares valued at $149,200); Entwisle (13,740 shares
valued at $383,896); Tjian (12,350 shares valued at $345,059) and Lenz
(7,140 shares valued at $199,492). The following table sets forth the
restricted performance share grants that were made on the following dates
to the named individuals:
Jan. 22, 1997 Jan. 21, 1998 Jan. 28, 1999
Market Price: Market Price: Market Price
$19.25/Share $32.79/Share $34.56/Share
--------------- --------------- --------------
David L. Payne 0 0 0
Jennifer J. Finger 0 1,470 3,870
Robert W. Entwisle 6,270 3,990 3,480
Hans T. Y. Tjian 5,640 3,570 3,140
Thomas S. Lenz 3,120 2,040 1,980
Mr. Payne's 1995, 1996 and 1997 restricted performance shares were canceled
by the Employee Benefits and Compensation Committee on October 22, 1997,
with Mr. Payne's consent, in exchange for Mr. Payne receiving the right to
receive a nonqualified pension from the Corporation at age 55. See "Other
Arrangements--Pension Agreement."
7
<PAGE>
(4) Restricted performance share grants based on corporate performance in 1999
were made on January 25, 2000 (on which date the market price was $24.00
per share) to the named individuals as follows: Payne--0; Finger--5,630;
Entwisle--5,070; Tjian--6,630; and Lenz--4,570.
(5) Includes 1999 matching contributions made by the Corporation under the Tax
Deferred Savings/Retirement Plan ("ESOP") for the accounts of Messrs.
Payne, Entwisle, Tjian, Lenz and Ms. Finger in the amount of: Payne--$0;
Finger--$9,600; Entwisle--$9,600; Tjian--$9,274; and Lenz--$4,694; and
includes 1999 contributions made by the Corporation under the profit
Sharing/Retirement Plan for the accounts of Messrs. Payne, Entwisle, Tjian
and Lenz, and Ms. Finger of: Payne--$7,200; Finger--$7,200;
Entwisle--$7,200; Tjian--$6,804; and Lenz--$5,937; and includes 1999
insurance premiums paid by the Corporation for the accounts of Messrs.
Payne, Entwisle, Tjian and Lenz and Ms. Finger in the amounts of:
Payne--$800; Finger--$554; Entwisle--$1,711; Tjian--$3,351; and
Lenz--$2,051.
(6) Includes the dollar value of the benefit to Mr. Payne of the remainder of
the premium payable by the Corporation with respect to a split dollar life
insurance policy for Mr. Payne (projected on an actuarial basis) in the
amounts of $21,987, $21,411,and $19,468 for 1997, 1998 and 1999,
respectively; and bonus paid to Mr. Payne which he used to pay his portion
of split dollar life insurance premiums in the amounts of $2,548, $2,772,
and $3,026 for 1997, 1998 and 1999, respectively.
(7) See "Other Arrangements--Deferred Compensation Agreement."
(8) Ms. Finger began her employment in September, 1997.
(9) Includes relocation expenses of $10,670 in 1998 and $3,330 in 1997.
</FN>
</TABLE>
The following table describes stock options that were granted pursuant to
the Westamerica Bancorporation 1995 Stock Option Plan (the "1995 Stock Option
Plan") to the Corporation's Chief Executive Officer and the four other most
highly compensated executive officers in the fiscal year ended December 31,
1999. All of these grants were made on January 24, 1999, based on achievement
of 1998 corporate performance objectives.
<TABLE>
OPTION GRANTS IN LAST FISCAL YEAR
<CAPTION>
Number Percent
of Securities of Total
Underlying Options Granted
Options to All Employees Exercise Expiration Present
Name Granted(1) in Fiscal Year Price Date Value(2)
- ---------------------- --------------- ------------------ ------------ ------------ ------------
<S> <C> <C> <C> <C> <C>
David L. Payne ......... 192,090 29% $ 34.56250 1/24/2009 $1,073,783
Jennifer J. Finger ..... 25,770 4 34.56250 1/24/2009 144,054
Robert W. Entwisle ..... 23,220 4 34.56250 1/24/2009 129,800
Hans T. Y. Tjian ....... 20,910 3 34.56250 1/24/2009 116,887
Thomas S. Lenz ......... 14,660 2 34.56250 1/24/2009 81,949
<FN>
- ------------
(1) All options are nonqualified stock options which vest ratably over a
three-year period commencing one year after the grant date. All options
have an exercise price equal to the market value on the date of grant. The
terms of all of the Corporation's stock option plans provide that options
may become exercisable in full in the event of a Change of Control as
defined in each stock option plan.
(2) A Modified Roll option pricing model using standard assumptions, including
12.0% annual dividend growth, a risk-free rate equal to the six-year U.S.
Treasury yield of 6.34%, volatility of 37.00% and a six-year maturity was
used to derive the per share option value of $5.59.
</FN>
</TABLE>
8
<PAGE>
The following table sets forth the stock options exercised in 1999 and the
December 31, 1999 unexercised value of both vested and unvested stock options
for the Corporation's Chief Executive Officer and the four other most highly
compensated executive officers.
<TABLE>
AGGREGATED OPTION EXERCISES IN LAST FISCAL YEAR
AND DECEMBER 31, 1999 OPTION VALUES
<CAPTION>
Number of Securities
Underlying Unexercised Value of Unexercised
Options at In-The-Money Options
Shares December 31, 1999 at December 31, 1999(1)
Acquired Value ------------------------------- -------------------------------
Name on Exercise Realized Exercisable Unexercisable Exercisable Unexercisable
- --------------------------- ------------- ---------- ------------- --------------- ------------- ---------------
<S> <C> <C> <C> <C> <C> <C>
David L. Payne ............ -- -- 400,630 352,150 $5,006,172 $ 278,080
Jennifer J. Finger ........ -- -- 4,290 34,350 -- --
Robert W. Entwisle ........ 12,600 $360,423 115,090 47,300 1,733,022 74,734
Hans T. Y. Tjian .......... 15,000 426,706 112,170 42,600 1,753,405 67,348
Thomas S. Lenz ............ 7,169 141,736 12,800 27,660 72,996 36,498
<FN>
- ------------
(1) Based on the closing price of the Corporation's Common Stock of $27.94 per
share on December 31, 1999.
</FN>
</TABLE>
OTHER ARRANGEMENTS
Certain Employment Contracts
WAB entered into an employment agreement with Mr. Entwisle, dated
January 7, 1987, with an annual base salary of $134,280. The agreement is
"evergreen" in the sense that the term of the agreement is automatically
extended for one additional month upon completion of each additional month of
employment unless WAB gives Mr. Entwisle one year's notice of intent to
terminate.
WAB may terminate Mr. Entwisle's employment without cause and Mr.
Entwisle may terminate his employment for "good reason," as defined in the
agreements. Under such circumstances, however, Mr. Entwisle would be entitled to
severance pay equal to the sum of: (i) one time his base salary; (ii) his
maximum bonus(es) had he remained employed one additional year past the date of
termination; and (iii) an amount equal to his automobile allowance for the one
year preceding the date of termination. The agreement with Mr. Entwisle provides
for the payment of liquidated damages upon termination of employment by WAB
without cause or termination by Mr. Entwisle for "good reason." Under the terms
of the agreement, the amount of liquidated damages is reduced by any severance
pay received by Mr. Entwisle and he is under a duty to mitigate his damages.
Hans T. Y. Tjian accepted a position with WAB as Senior Vice President
and Manager of Operations and Systems Administration under the terms set forth
in a letter agreement dated April 14, 1989. Under the terms of this agreement,
Mr. Tjian is entitled to: (i) receive an annual salary of $130,008; (ii) receive
a car allowance of $1,000 per month; (iii) participate in WAB's executive bonus
plan; (iv) participate in the Corporation's Stock Option Plan; and (v) vacation
leave. In addition, Mr. Tjian is entitled to receive severance pay equal to his
annual base salary for one year if his position is eliminated as a result of a
Change of Control.
Pension Agreement
During 1997, the Corporation entered into a nonqualified pension
agreement ("Pension Agreement") with Mr. Payne in consideration of Mr. Payne's
agreement that restricted performance shares granted in 1995, 1996 and 1997
would be canceled. The pension was to be calculated as a percentage of Mr.
Payne's three year average compensation (salary and bonus) preceding the earlier
of retirement or age 55. In January 2000 the percentage was determined by the
Employee Benefits and Compensation Committee (the "Committee") based on the
Corporation's achievement of certain performance goals which had first been
established for Mr. Payne's 1995, 1996, and 1997 restricted performance shares.
9
<PAGE>
Under the terms of the Pension Agreement and the percentage of compensation
provisions determined by the Committee, Mr. Payne's annual pension will be
$511,950. The vested portion of the pension will be paid to Mr. Payne as a
20-year certain pension commencing at age 55. Mr. Payne will be fully vested in
the pension based on continuous employment through December 31, 2002.
As part of the pension agreement, if Mr. Payne becomes subject to an
excise tax as a result of the accelerated vesting of the pension in connection
with a Change of Control, Mr. Payne will also receive a cash payment equal to
the sum of (i) the portion of any excise tax due attributable to the vested
pension in excess of the portion of any excise tax that would be due if Mr.
Payne's restricted performance shares had not been canceled, and (ii) the amount
necessary to restore Mr. Payne to the same after-tax position as if no such
excise tax had been imposed.
Deferred Compensation Agreement
In December 1998, the Corporation entered into a deferred compensation
agreement with Mr. Payne for additional discretionary deferred compensation to
provide an incentive to remain with the company through his retirement. The
deferred compensation will be delivered in the form of discretionary monthly
company contributions to be deposited in a non-qualified deferred compensation
plan. The Committee will periodically review the accumulated deferred
compensation balance, including investment performance, to determine if the
additional discretionary company contributions are necessary to provide to Mr.
Payne with an appropriate level of retirement benefits. The amount of such
additional company contributions will be determined quarterly by the Committee
and be based on Mr. Payne's attaining of certain performance goals to include,
but not be limited to, shareholder returns, overall financial performance,
merger and acquisition activities, loan review examinations, asset quality and
related reserves, and revenue growth.
Mr. Payne's deferred compensation award will be paid in a lump sum and
be contingent upon his continuous employment through December 31, 2003. The
agreement allows for accelerated payment only in the event of death, disability,
termination without cause, and termination as a result of a Change of Control
(as defined in the 1995 Stock Option Plan). Deferred compensation of $236,520
was deposited in the non-qualified discretionary plan in 1999 as the Committee
determined that Mr. Payne had achieved the quarterly performance goals. The
accumulated deferred compensation account balance was $246,842 on December 31,
1999.
BOARD COMPENSATION COMMITTEE REPORT
The Board, operating through its Employee Benefits and Compensation
Committee, has established an executive compensation program and determines
annual compensation for executives based on performance. This executive
compensation program and annual evaluation process establishes a competitive
base salary for each executive and offers incentive compensation which can
provide additional compensation if established performance measures are
achieved. This additional compensation can be in the form of short-term annual
cash bonuses, long-term stock options, and either long-term restricted
performance shares or supplemental deferred compensation benefits.
In determining total compensation, the Committee obtains competitive
market data, comparing the Company's compensation practices to those of a peer
group of companies. The group is comprised of companies in the banking industry
with which the Company competes for executive talent and which are generally
comparable with respect to business activities. Each named executive officer
receives a monthly base salary, and is eligible to receive an annual cash bonus,
an annual grant of stock options and an annual grant of restricted performance
shares. The program was recently amended to include Company contributions to a
non-qualified deferred compensation plan for the Chief Executive Officer. Over
time, the Committee intends to limit base salaries, creating an increasing
reliance on annual cash bonuses to achieve targeted total cash compensation,
thus increasing the percentage of total compensation dependent upon meeting
specific performance objectives. This furthers the Committee's goal of linking
management compensation to shareholder interests.
Corporate performance measures are established each year based on the
Corporation's business objectives. Actual stock grants and deferred compensation
awards depend on achievement of these
10
<PAGE>
annual corporate objectives. Specific criteria for each corporate objective are
established for "Threshold," "Target," and "Outstanding" performance.
Achievement of these annual performance measures also determines between 55% and
80% of the annual cash bonuses to be paid to each named executive, with the
remaining 45% and 20% determined by individual and division performance.
Corporate performance measures for 1999, which determined January 2000
cash bonuses and option grants, were to:
* reach target levels of return on equity, return on assets and
earnings per share;
* maintain credit quality measures at established levels;
* develop new sources of fee income;
* hold non-interest expenses below a specified level;
* maintain satisfactory audit results;
* improve assets per employee and revenues per employee to specified
levels; and
* achieve Y2K compliance.
Corporate performance measures for 1998, which determined January 1999
cash bonuses, option grants and restricted performance share grants, were to:
* reach target levels of return on equity, return on assets and
earnings per share;
* maintain credit quality measures at established levels;
* hold non-interest expenses below a specified level;
* maintain satisfactory audit results; and
* improve assets per employee and revenues per employee to specified
levels.
Additional corporate performance objectives for a three-year period are
established by the Employee Benefits and Compensation Committee to accompany
each grant of restricted performance shares. Whether each grant vests three
years following the date of grant is determined by achievement of these
pre-established, three-year performance objectives which include, but are not
limited to, return on equity, earnings per share growth, revenue per share
growth, asset quality, service quality and client satisfaction.
The Chief Executive Officer's base salary in 1999 of $272,016 was
established at a level judged to be competitive with comparable positions at
other financial institutions. The Chief Executive Officer's $350,000 bonus
earned in 1999 (included in the Summary Compensation Table listed above) was
related 80% to the achievement of the 1999 corporate goals listed above and 20%
to the achievement of individual management goals. The Chief Executive Officer's
receipt, pursuant to the 1995 Stock Option Plan, of 261,500 nonqualified stock
options in January 2000 was related to achievement of the 1999 performance
measures listed above. Individual management goals achieved in 1999 included
satisfactory results from regulatory examinations, satisfactory internal
controls, satisfactory Y2K performance, satisfactory progress on acquisitions,
and development of a management succession plan. Compared to the 1999 corporate
objectives listed above, the Corporation:
* exceeded its profitability objectives;
* improved credit quality measures to better than established levels;
* outperformed non-interest expense and control goals;
* increased new sources of non-interest income revenues;
* maintained satisfactory audit results;
* improved efficiency measures to better than targeted levels; and
* met Y2K performance goals.
In December 1998, the Corporation provided Mr. Payne with a deferred
compensation agreement for additional corporate contributions to remain with the
company through his retirement because of his leadership capabilities and his
role in the development of potential acquisition targets. He must also attain
11
<PAGE>
certain performance goals that include, overall shareholder returns, financial
performance, loan review examination, asset quality, and revenue growth. In
January the Committee determined that Mr. Payne substantially met all the
pre-established objectives in 1999 and the company contributed $236,520 to his
deferred compensation account. The additional company contributions will be
distributed to him in a lump sum upon his continuous employment through December
31, 2003.
The Chief Executive Officer's receipt, pursuant to the 1995 Stock
Option Plan, of 192,090 nonqualified stock options in January 1999 was related
to achievement of the 1998 corporate performance measures listed above. Compared
to the 1998 corporate objectives listed above, the Corporation:
* exceeded its targeted profitability objectives;
* improved credit quality measures to better than established levels;
* outperformed non-interest expense and control goals; and
* improved efficiency measures to better than targeted levels.
Other. In 1993, the Internal Revenue Code ("IRC") was amended to add
section 162(m). Section 162(m) places a limit of $1,000,000 on the amount of
compensation that may be deducted by the Corporation in any year with respect to
certain of the Corporation's highest paid executives. The Corporation intends
generally to qualify compensation paid to executive officers for deductibility
under the IRC, including section 162(m), but reserves the right to pay
compensation that is not deductible under section 162(m).
The Employee Benefits and Compensation Committee believes that the
foregoing compensation programs and policies provide competitive levels of
compensation, encourage long-term performance and promote management retention
while further aligning shareholders' and managements' interests in the
performance of the Corporation and the Corporation's Common Stock.
THE EMPLOYEE BENEFITS AND COMPENSATION COMMITTEE:
PATRICK D. LYNCH, CHAIRMAN RONALD A. NELSON
ETTA ALLEN MICHAEL J. RYAN, JR.
DON J. EMERSON
12
<PAGE>
[The following descriptive data is supplied in accordance with Rule 304(d) of
Regulation S-T]
Total Return Performance(1)
Period Ending
-----------------------------------------------------
Index 12/31/94 12/31/95 12/31/96 12/31/97 12/31/98 12/31/99
- --------------------------------------------------------------------------------
Westamerica Bancorporation 100.00 148.49 202.02 363.25 398.14 308.54
S&P 500 100.00 137.58 169.03 225.44 289.79 350.78
Western Bank Monitor(2) 100.00 142.80 177.12 324.96 341.20 341.20
(1) Assumes $100 invested on December 31, 1994 in the Corporation's Common
Stock, the S&P 500 composite stock index and SNL Securities' Western Bank
Monitor index, with reinvestment of dividends.
(2) Source: SNL Securities.
APPROVAL OF AUDITORS
The Board has selected KPMG LLP as independent auditor for the
Corporation for the 2000 fiscal year, subject to the approval of the
shareholders. KPMG LLP has informed the Corporation that it has had no
connection during the past three years with the Corporation or its subsidiaries
in the capacity of promoter, underwriter, voting trustee, director, officer or
employee.
Representatives of KPMG LLP will be present at the Meeting with the
opportunity to make a statement if they desire to do so and to respond to
appropriate questions.
13
<PAGE>
OTHER MATTERS
Management of the Corporation does not know of any matters to be
presented at the Meeting other than those specifically referred to herein. If
any other matters should properly come before the Meeting or any postponement or
adjournment thereof, the persons named in the enclosed proxy intend to vote
thereon in accordance with their best business judgment.
For a matter to be properly brought before the Meeting by a
shareholder, section 2.02 of the Corporation's Bylaws ("Section 2.02") provides
that the shareholder must deliver or mail a written notice to the Secretary (or
Assistant Secretary) of the Corporation not less than 14 days nor more than 50
days prior to the Meeting. Section 2.02 also provides that the notice must set
forth as to each matter that the shareholder proposes to bring before the
Meeting a brief description of the business desired to be brought before the
Meeting and the reasons for conducting such business at the Meeting, the name
and residence address of the shareholder proposing such business, the number of
shares of the Corporation's common stock that are owned by the shareholder and
any material interest of the shareholder in such business.
The cost of the solicitation of proxies in the accompanying form will
be borne by the Corporation. The Corporation has retained the services of
Corporate Investor Communications, Inc. to assist in the proxy distribution at a
cost not to exceed $2,000 plus reasonable out-of-pocket expenses. The
Corporation will reimburse banks, brokers and others holding stock in their
names or names of nominees or otherwise for reasonable out-of-pocket expenses
incurred in sending proxies and proxy materials to the beneficial owners of such
stock.
BY ORDER OF THE BOARD OF DIRECTORS
/s/ Kris Irvine
----------------------------------------
Kris Irvine
Assistant Corporate Secretary
Dated: March 20, 2000
14
