<PAGE>
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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-Q
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
FOR THE QUARTERLY PERIOD ENDED MARCH 31, COMMISSION FILE NUMBER 1-7476
1996
AMSOUTH BANCORPORATION
(EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
DELAWARE 63-0591257
(STATE OR OTHER JURISDICTION OF (I.R.S. EMPLOYER IDENTIFICATION NO.)
INCORPORATION OR ORGANIZATION)
35203
1400 AMSOUTH--SONAT TOWER (ZIP CODE)
BIRMINGHAM, ALABAMA
(ADDRESS OF PRINCIPAL EXECUTIVE
OFFICES)
(205) 320-7151
(REGISTRANT'S TELEPHONE NUMBER, INCLUDING AREA CODE)
Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to
such filing requirements for the past 90 days.
Yes X No
As of May 10, 1996, AmSouth Bancorporation had 56,487,752 shares of common
stock outstanding.
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<PAGE>
AMSOUTH BANCORPORATION
FORM 10-Q
INDEX
<TABLE>
<CAPTION>
PAGE
----
<S> <C> <C> <C>
Part I. Financial Information
Item 1. Financial Statements (Unaudited)
Consolidated Statement of Condition--March 31, 1996,
December 31, 1995,
and March 31, 1995................................. 3
Consolidated Statement of Earnings--Three months
ended March 31, 1996
and 1995........................................... 4
Consolidated Statement of Shareholders' Equity--
Three months ended March 31, 1996.................. 5
Consolidated Statement of Cash Flows--Three months
ended March 31, 1996
and 1995........................................... 6
Notes to Consolidated Financial Statements.......... 7
Independent Accountants' Review Report.............. 8
Item 2. Management's Discussion and Analysis of Financial
Condition and Results of Operations................ 9
Part II. Other Information
Item 1. Legal Proceedings................................... 19
Item 4. Submission of Matters to a Vote of Security Holders.. 19
Item 6. Exhibits and Reports on Form 8-K.................... 19
Signatures............................................................. 20
Exhibit Index.......................................................... 21
</TABLE>
2
<PAGE>
PART I
FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS (UNAUDITED)
AMSOUTH BANCORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENT OF CONDITION
(UNAUDITED)
<TABLE>
<CAPTION>
MARCH 31 DECEMBER 31 MARCH 31
1996 1995 1995
----------- ----------- -----------
(IN THOUSANDS)
<S> <C> <C> <C>
ASSETS
Cash and due from banks................. $ 587,278 $ 651,641 $ 743,786
Federal funds sold and securities pur-
chased under agreements to resell...... 1,600 1,775 3,650
Trading securities...................... 3,510 2,978 10,485
Available-for-sale securities........... 2,534,791 2,479,813 481,051
Held-to-maturity securities (market
value of $2,565,870, $2,193,421 and
$3,206,175, respectively).............. 2,574,911 2,167,009 3,272,626
Mortgage loans held for sale............ 121,672 62,017 79,185
Loans................................... 11,546,007 11,819,809 11,798,102
Less: Allowance for loan losses......... 177,930 178,451 174,398
Unearned income................... 69,810 76,536 52,987
----------- ----------- -----------
Net loans......................... 11,298,267 11,564,822 11,570,717
Premises and equipment, net............. 279,218 276,426 282,828
Customers' acceptance liability......... 3,311 2,007 8,911
Accrued interest receivable and other
assets................................. 509,828 530,307 614,666
----------- ----------- -----------
$17,914,386 $17,738,795 $17,067,905
=========== =========== ===========
LIABILITIES AND SHAREHOLDERS' EQUITY
Deposits and interest-bearing liabili-
ties:
Deposits:
Noninterest-bearing demand............. $ 1,795,572 $ 1,834,853 $ 1,840,328
Interest-bearing demand................ 3,819,358 3,912,506 3,935,173
Savings................................ 1,025,472 1,005,099 926,277
Time................................... 5,696,508 5,661,130 5,797,176
Certificates of deposit of $100,000 or
more.................................. 915,576 995,243 851,003
----------- ----------- -----------
Total deposits........................ 13,252,486 13,408,831 13,349,957
Federal funds purchased and securities
sold under agreements to repurchase... 1,898,094 1,861,090 1,291,228
Other borrowed funds................... 525,899 490,192 593,225
Long-term debt......................... 660,496 440,899 344,326
----------- ----------- -----------
Total deposits and interest-bearing
liabilities.......................... 16,336,975 16,201,012 15,578,736
Acceptances outstanding................. 3,311 2,007 8,911
Accrued expenses and other liabilities.. 204,546 152,301 145,067
----------- ----------- -----------
Total liabilities..................... 16,544,832 16,355,320 15,732,714
----------- ----------- -----------
Shareholders' equity:
Preferred stock--no par value:
Authorized--2,000,000 shares;
Issued and outstanding--none........... -0- -0- -0-
Common stock--par value $1 a share:
Authorized--200,000,000 shares
Issued--60,029,742, 60,030,242 and
59,679,305 shares, respectively....... 60,030 60,030 59,679
Capital surplus......................... 589,989 590,882 582,452
Retained earnings....................... 812,767 788,170 721,149
Cost of common stock in treasury--
3,583,932, 2,765,000, and 1,500,000
shares, respectively................... (105,479) (73,192) (24,173)
Deferred compensation on restricted
stock.................................. (5,097) (4,120) (3,716)
Unrealized gains/(losses) on available-
for-sale securities, net of deferred
taxes.................................. 17,344 21,705 (200)
----------- ----------- -----------
Total shareholders' equity............ 1,369,554 1,383,475 1,335,191
----------- ----------- -----------
$17,914,386 $17,738,795 $17,067,905
=========== =========== ===========
</TABLE>
See notes to consolidated financial statements.
3
<PAGE>
AMSOUTH BANCORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENT OF EARNINGS(UNAUDITED)
<TABLE>
<CAPTION>
THREE MONTHS
ENDED MARCH 31
---------------------
1996 1995
---------- ----------
(IN THOUSANDS EXCEPT
PER SHARE DATA)
<S> <C> <C>
REVENUE FROM EARNING ASSETS
Loans.................................................... $ 250,870 $ 243,934
Securities:
Trading securities...................................... 41 153
Available-for-sale securities........................... 38,472 9,899
Held-to-maturity securities............................. 40,221 53,885
---------- ----------
Total securities........................................ 78,734 63,937
Mortgage loans held for sale............................. 1,406 1,724
Federal funds sold and securities purchased under agree-
ments to resell......................................... 354 466
---------- ----------
Total revenue from earning assets....................... 331,364 310,061
---------- ----------
INTEREST EXPENSE
Interest-bearing demand deposits......................... 30,356 38,110
Savings deposits......................................... 6,682 6,707
Time deposits............................................ 82,600 72,964
Certificates of deposit of $100,000 or more.............. 13,348 11,604
Federal funds purchased and securities sold under agree-
ments to repurchase..................................... 21,805 18,369
Other borrowed funds..................................... 8,250 9,620
Long-term debt........................................... 10,618 7,203
---------- ----------
Total interest expense.................................. 173,659 164,577
---------- ----------
NET INTEREST INCOME...................................... 157,705 145,484
Provision for loan losses................................ 15,120 8,344
---------- ----------
NET INTEREST INCOME AFTER PROVISION FOR LOAN LOSSES...... 142,585 137,140
---------- ----------
NONINTEREST REVENUES
Service charges on deposit accounts...................... 23,126 20,244
Trust income............................................. 13,481 11,405
Credit card income....................................... 3,182 2,872
Consumer investment services............................. 3,488 1,249
Mortgage income.......................................... 1,122 8,342
Interchange income....................................... 1,683 1,092
Letters of credit income................................. 2,034 1,794
Portfolio income......................................... 1,952 3,400
Other operating revenues................................. 5,027 6,409
---------- ----------
Total noninterest revenues.............................. 55,095 56,807
---------- ----------
NONINTEREST EXPENSES
Salaries and employee benefits........................... 57,239 59,156
Net occupancy expense.................................... 13,190 12,253
Equipment expense........................................ 12,803 11,114
Marketing expense........................................ 4,377 4,542
Postage and office supplies.............................. 5,876 6,135
Telephone expense........................................ 3,350 3,127
Professional fees........................................ 2,225 2,278
FDIC premiums............................................ 2,562 7,211
Foreclosed properties expense............................ 453 64
Amortization of intangibles.............................. 4,167 8,834
Other operating expenses................................. 16,606 16,930
---------- ----------
Total noninterest expenses.............................. 122,848 131,644
---------- ----------
INCOME BEFORE INCOME TAXES............................... 74,832 62,303
Income taxes............................................. 27,669 22,193
---------- ----------
Net income.............................................. $ 47,163 $ 40,110
========== ==========
Average common shares outstanding........................ 57,021 58,103
Earnings per common share................................ $ 0.83 $ 0.69
</TABLE>
See notes to consolidated financial statements.
4
<PAGE>
AMSOUTH BANCORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENT OF SHAREHOLDERS' EQUITY
(UNAUDITED)
<TABLE>
<CAPTION>
UNREALIZED
COMMON CAPITAL RETAINED TREASURY DEFERRED GAINS/(LOSSES)
STOCK SURPLUS EARNINGS STOCK COMPENSATION ON SECURITIES TOTAL
------- -------- -------- --------- ------------ -------------- ----------
(IN THOUSANDS)
<S> <C> <C> <C> <C> <C> <C> <C>
Balance at January 1,
1996................... $60,030 $590,882 $788,170 $ (73,192) $(4,120) $21,705 $1,383,475
Net income.............. -0- -0- 47,163 -0- -0- -0- 47,163
Cash dividends declared
($0.40 per common
share)................. -0- -0- (22,566) -0- -0- -0- (22,566)
Common stock
transactions:
Purchase of common
stock................. -0- -0- -0- (39,405) -0- -0- (39,405)
Employee stock plans... -0- (924) -0- 5,832 (977) -0- 3,931
Dividend reinvestment.. -0- 31 -0- 1,286 -0- -0- 1,317
Unrealized losses on
available-for-sale
securities, net of
deferred taxes......... -0- -0- -0- -0- -0- (4,361) (4,361)
------- -------- -------- --------- ------- ------- ----------
Balance at March 31,
1996................... $60,030 $589,989 $812,767 $(105,479) $(5,097) $17,344 $1,369,554
======= ======== ======== ========= ======= ======= ==========
</TABLE>
See notes to consolidated financial statements.
5
<PAGE>
AMSOUTH BANCORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENT OF CASH FLOWS
(UNAUDITED)
<TABLE>
<CAPTION>
THREE MONTHS
ENDED MARCH 31
------------------
1996 1995
-------- --------
(IN THOUSANDS)
<S> <C> <C>
OPERATING ACTIVITIES
Net income................................................. $ 47,163 $ 40,110
Adjustments to reconcile net income to net cash provided by
operating activities
Provision for loan losses................................. 15,120 8,344
Foreclosed property recoveries............................ -0- (273)
Depreciation and amortization of premises and equipment... 6,799 6,748
Amortization of premiums and discounts on held-to-maturity
securities and available-for-sale securities............. (1,043) (1,477)
Net (increase) decrease in mortgage loans held for sale... (59,655) 51,038
Net increase in trading securities........................ (532) (2,171)
Net gains on sales of available-for-sale securities....... (1,339) (3,207)
Net gains on calls of held-to-maturity securities......... (118) (151)
Net decrease in accrued interest receivable and other
assets................................................... 20,835 15,972
Net increase in accrued expenses and other liabilities.... 49,247 24,913
Provision for deferred income taxes....................... 5,545 417
Amortization of intangible assets......................... 4,167 8,834
Other..................................................... 451 (904)
-------- --------
Net cash provided by operating activities................. 86,640 148,193
-------- --------
INVESTING ACTIVITIES
Proceeds from maturities and prepayments of available-for-
sale securities........................................... 203,677 7,192
Proceeds from sales of available-for-sale securities....... 303,731 132,494
Purchases of available-for-sale securities................. (299,836) (273,484)
Proceeds from maturities, prepayments and calls of held-to-
maturity securities....................................... 124,525 64,838
Purchases of held-to-maturity securities................... (532,154) -0-
Net decrease in federal funds sold and securities purchased
under agreements to resell................................ 175 148,875
Net increase in loans...................................... (20,342) (225,171)
Net purchases of premises and equipment.................... (9,591) (5,798)
Net cash used for acquisitions............................. -0- (13,221)
-------- --------
Net cash used by investing activities..................... (229,815) (164,275)
-------- --------
FINANCING ACTIVITIES
Net decrease in demand deposits and savings accounts....... (112,056) (201,593)
Net (decrease) increase in time deposits................... (44,025) 402,469
Net increase in federal funds purchased and securities sold
under agreements to repurchase............................ 37,004 78,505
Net increase (decrease) in other borrowed funds............ 36,008 (81,039)
Issuance of long-term debt................................. 220,000 -0-
Payments for maturing long-term debt....................... (850) (34,988)
Cash dividends paid........................................ (22,566) (22,097)
Proceeds from employee stock plans......................... 4,702 1,972
Purchase of common stock................................... (39,405) -0-
-------- --------
Net cash provided by financing activities................. 78,812 143,229
-------- --------
(Decrease) increase in cash and cash equivalents........... (64,363) 127,147
Cash and cash equivalents at beginning of period........... 651,641 616,639
-------- --------
Cash and cash equivalents at end of period................. $587,278 $743,786
======== ========
</TABLE>
See notes to consolidated financial statements.
6
<PAGE>
AMSOUTH BANCORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)
THREE MONTHS ENDED MARCH 31, 1996 AND 1995
General--The consolidated financial statements conform to generally accepted
accounting principles and to general industry practices. The accompanying
interim financial statements are unaudited; however, in the opinion of
management, all adjustments necessary for the fair presentation of the
consolidated financial statements have been included. All such adjustments are
of a normal recurring nature. Certain amounts in the prior year's financial
statements have been reclassified to conform with the 1996 presentation. These
reclassifications had no effect on net income. The consolidated financial
statements include the accounts of AmSouth and its subsidiaries. All
significant intercompany balances and transactions have been eliminated. The
notes included herein should be read in conjunction with the notes to
consolidated financial statements included in AmSouth Bancorporation's
(AmSouth) 1995 annual report on Form 10-K.
Effective January 1, 1996, AmSouth adopted Statement of Financial Accounting
Standards No. 121, "Accounting for the Impairment of Long-Lived Assets and for
Long-Lived Assets to be Disposed Of" (Statement 121). Statement 121 requires
that long-lived assets and certain identifiable intangibles to be held and
used by an entity be reviewed for impairment whenever events or changes in
circumstances indicate that the carrying amount of the asset may not be
recoverable. An impairment loss is recognized when the sum of the future cash
flows (undiscounted and without interest charges expected from the use of the
asset and its eventual disposition) is less than the carrying amount of the
asset. The adoption of Statement 121 resulted in no material impact on
AmSouth's financial condition or results of operations.
Statement of Financial Accounting Standards No. 122, "Accounting for
Mortgage Servicing Rights, an amendment of FASB Statement No. 65" (Statement
122) was adopted by AmSouth effective January 1, 1996. In accordance with
Statement 122, the cost of mortgage loans purchased or originated with a
definitive plan to sell the loans and retain the mortgage servicing rights is
allocated between the loans and the servicing rights based on their estimated
fair values at the purchase or origination date. The adoption of Statement 122
resulted in no material impact on AmSouth's financial condition or results of
operations.
Cash Flows--For the three months ended March 31, 1996 and 1995, AmSouth paid
interest of $169,773,000 and $148,987,000, respectively, and income taxes of
$4,782,000 and $813,000, respectively. Noncash transfers from loans to
foreclosed properties for the three months ended March 31, 1996 and 1995 were
$5,105,000 and $3,323,000, respectively, and noncash transfers from foreclosed
properties to loans were $91,000 and $274,000, respectively. For the three
months ended March 31, 1996, a noncash transfer from loans to available-for-
sale securities of approximately $266,814,000 was made in connection with a
mortgage loan securitization.
Shareholders' Equity--On March 1, 1996, AmSouth purchased 1,000,000 shares
of its common stock at a cost of $39,405,000 for the purpose of satisfying
requirements of employee benefit and dividend reinvestment plans and other
corporate purposes. This repurchase was part of a plan approved in October
1995. All shares have been repurchased as of March 31, 1996.
7
<PAGE>
INDEPENDENT ACCOUNTANTS' REVIEW REPORT
The Board of Directors
AmSouth Bancorporation
We have reviewed the accompanying consolidated statement of condition of
AmSouth Bancorporation and subsidiaries as of March 31, 1996 and 1995, and the
related consolidated statements of earnings and cash flows for the three-month
periods ended March 31, 1996 and 1995, and the consolidated statement of
shareholders' equity for the three-month period ended March 31, 1996. These
financial statements are the responsibility of the Company's management.
We conducted our reviews in accordance with standards established by the
American Institute of Certified Public Accountants. A review of interim
financial information consists principally of applying analytical procedures
to financial data, and making inquiries of persons responsible for financial
and accounting matters. It is substantially less in scope than an audit
conducted in accordance with generally accepted auditing standards, which will
be performed for the full year with the objective of expressing an opinion
regarding the financial statements taken as a whole. Accordingly, we do not
express such an opinion.
Based on our reviews, we are not aware of any material modifications that
should be made to the accompanying consolidated financial statements referred
to above for them to be in conformity with generally accepted accounting
principles.
We have previously audited, in accordance with generally accepted auditing
standards, the consolidated statement of condition of AmSouth Bancorporation
and subsidiaries as of December 31, 1995, and the related consolidated
statements of earnings, shareholders' equity, and cash flows for the year then
ended (not presented herein) and in our report dated January 31, 1996, we
expressed an unqualified opinion on those consolidated financial statements.
In our opinion, the information set forth in the accompanying consolidated
statement of condition as of December 31, 1995, is fairly stated, in all
material respects, in relation to the consolidated statement of condition from
which it has been derived.
/s/ ERNST & YOUNG LLP
May 9, 1996
8
<PAGE>
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS
AmSouth reported net income of $47.2 million for the three months ended
March 31, 1996, compared to $40.1 million for the same period of 1995.
Earnings per common share were $.83 and $.69, respectively. First quarter
earnings resulted in an annualized return on average assets of 1.07% and an
annualized return on average equity of 13.78%, compared to .96% and 12.28% for
the first quarter of 1995. AmSouth's operating efficiency ratio for the first
quarter of 1996 improved to 57.05% compared to 64.14% for the prior year.
Net Interest Income
Net interest income on a fully taxable equivalent basis for the three months
ended March 31, 1996 was $160.3 million compared to $148.8 million for the
same period of 1995. The improvement in net interest income was primarily the
result of a $961.1 million increase in average earning asset balances. Net
interest margin increased three basis points to 3.91%.
The increase in average earning assets was primarily due to increases in
average securities and average loans net of unearned income. Average
securities increased $902.3 million due to the securitization of $352.0
million of variable rate residential first mortgages late in the fourth
quarter of 1995 and additional purchases of securities. Average loans net of
unearned income increased $111.6 million. Exclusive of residential first
mortgages, the increase was $719.7 million, or 10.0%, primarily in commercial,
dealer indirect and consumer revolving credit loans.
The average balance of interest-bearing liabilities increased $729.8
million, funding 75.9% of the growth in average earning assets. An increase of
$427.1 million in average Federal funds purchased and securities sold under
agreements to repurchase was the primary reason for the increase. Average
interest-bearing deposits, primarily savings and time deposits, increased
$107.5 million. Other significant changes include a $217.9 million increase in
treasury, tax and loan notes, a $150.3 million increase in parent company
subordinated long-term debt, related to the issuance of 6.75% debentures, and
a $193.5 million decrease in term Federal funds purchased. The remaining
growth in average earning assets was funded by decreases in noninterest-
earning assets and increases in noninterest-bearing liabilities and
shareholders' equity.
Asset/Liability Management and Interest Rate Risk
AmSouth maintains a formal asset and liability management process to
quantify, monitor and control interest rate risk and to assist management in
maintaining stability in the net interest margin under varying interest rate
environments. This is accomplished through the development and implementation
of lending, funding and pricing strategies designed to maximize net interest
income performance under varying interest rate environments subject to
specific liquidity and interest rate risk guidelines.
The primary tool used by AmSouth to measure interest rate risk is an
earnings simulation model which evaluates the impact of different interest
rate scenarios on the corporation's projected business plan over a 12 to 24
month horizon. Management feels that a more traditional interest sensitivity
gap analysis does not provide a complete picture of the corporation's exposure
to interest rate changes since static gap models are a point-in-time
measurement and, therefore, do not incorporate the effects of future balance
sheet trends, changes in the relationship between yields earned and rates
paid, patterns of rate movements in general or changes in prepayment speeds
due to changes in rates. AmSouth's earnings simulation model incorporates the
effect of these factors in addition to the impact of certain embedded interest
rate caps and floors on certain assets and liabilities while also reflecting
management's anticipated action under varying interest rate environments.
Interest rate scenarios are simulated on a regular basis to determine the
range of interest rate risk. Net interest income performance is measured under
scenarios ranging from plus or minus 100 basis points to plus or minus 300
basis points over 12 months compared to a stable interest rate environment.
The net interest income differential is expressed as a percent of net interest
income over twelve months if interest rates are unchanged. As of March 31,
1996, the earnings simulation model results indicated that the corporation was
in a relatively neutral interest rate risk position with net interest income
in a plus or minus 200 basis point scenario being approximately equal to
projected net interest income in a stable interest rate scenario. This level
of interest rate risk is well within the corporation's policy guidelines. A
very important factor in determining this interest rate risk position is the
extent to which pricing on administered rate deposit products, including
interest checking,
9
<PAGE>
savings and money market accounts, would be affected under varying interest
rate scenarios. At AmSouth, pricing for these products is assumed to be more
variable in rising rate scenarios than in declining rate scenarios. While
these assumptions are somewhat subjective, management reviews the anticipated
pricing for these products on a regular basis and alters these assumptions
whenever trends or market conditions dictate.
Over the last few years, AmSouth has, from time to time, utilized various
off-balance sheet instruments such as interest rate swaps, caps and floors to
assist in managing interest rate risk. At March 31, 1996, AmSouth had $1.0
billion notional amount of caps outstanding, consisting of $500.0 million of
caps sold and $500.0 million of caps purchased, as hedges on $500.0 million of
prime rate loans. This transaction effectively locks-in the historically wide
300 basis point spread between Federal funds and the prime rate in a rising
rate environment. In addition to the caps, AmSouth had interest rate swaps in
the aggregate notional amount of $150.0 million which were purchased to hedge
the cost of $150.0 million of 6.75% subordinated debentures issued in the
fourth quarter of 1995. These swaps effectively convert the fixed rate
applicable to these debentures to a floating rate tied to the one-month LIBOR
rate. At March 31, 1996, AmSouth also held other off-balance sheet instruments
to provide customers and AmSouth a means of managing the risks of changing
interest and foreign exchange rates. These other off-balance sheet instruments
were immaterial. At March 31, 1996, no off-balance sheet instruments were held
for trading purposes.
Credit Quality and Allowance for Loan Losses
AmSouth maintains an allowance for loan losses which it believes is adequate
to absorb losses inherent in the loan portfolio. A formal review is prepared
quarterly to assess the risk in the portfolio and to determine the adequacy of
the allowance for loan losses. The review includes analyses of historical
performance, the level of nonperforming and adversely rated loans, specific
analyses of certain problem loans, loan activity since the previous quarter,
reports prepared by the Loan Review Department, consideration of current
economic conditions, and other pertinent information. The level of allowance
to net loans outstanding will vary depending on the overall results of this
quarterly review. The review is then presented to and subsequently approved by
senior management and the Audit and Community Responsibility Committee of the
Board of Directors.
Table 6 presents a five quarter analysis of the allowance for loan losses.
At March 31, 1996, the allowance for loan losses was $177.9 million, or 1.55%
of loans net of unearned income, compared to $174.4 million, or 1.48%, for the
prior year. The coverage ratio of the allowance for loan losses to
nonperforming loans increased from 169.74% at March 31, 1995 to 195.70% for
the same period in 1996 as the level of nonperforming loans decreased by $11.8
million.
For the three months ended March 31, 1996, net charge-offs were $15.6
million, an increase of $8.8 million compared to the same period of 1995. The
increase was primarily in the consumer revolving credit and dealer indirect
loan portfolios which grew during the period 36.0% and 15.0%, respectively.
Declining trends in credit quality in the consumer sector of the economy also
contributed to the increase. Annualized net charge-offs to average loans net
of unearned income for the three months ended March 31, 1996 was .54% compared
to .24% for the same period of the prior year. The increased level of net
charge-offs combined with the growth in the consumer loan portfolio, which
traditionally has a higher risk of loss, resulted in a provision for loan
losses for the period of $15.1 million.
Table 7 presents a five quarter comparison of the components of
nonperforming assets. As a percentage of loans net of unearned income,
foreclosed properties and repossessions, nonperforming assets decreased from
1.10% at March 31, 1995 to .95% at March 31, 1996. The level of nonperforming
assets decreased $20.4 million during the same period.
Included in nonperforming assets at March 31, 1996 was a recorded investment
of $53.2 million in loans that were considered to be impaired, substantially
all of which were on a nonaccrual basis. Collateral dependent loans, which
were measured at the fair value of the collateral, constituted approximately
all of these impaired loans. There was no material balance in the allowance
for loan losses specifically allocated to these impaired loans as the recorded
investment in these loans approximated the fair value of the collateral at
March 31, 1996. The average level of impaired loans during the three months
ended March 31, 1996 was $55.2 million. AmSouth recorded no material interest
income on its impaired loans during the three months ended March 31, 1996.
10
<PAGE>
Noninterest Revenues and Noninterest Expenses
---------------------------------------------
Noninterest revenues for the three months ended March 31, 1996 totaled $55.1
million compared to $56.8 million for the same period of the prior year.
Compared to the prior year, service charges on deposit accounts increased $2.9
million, or 14.2%. This increase is attributable to a revenue enhancement
initiative that was implemented in the second quarter of 1995 to automate the
payment of certain demand deposit account service fees. Trust income increased
18.2% to $13.5 million primarily from increased customer activity in personal
trusts, new employee benefit plan administration accounts and higher fees.
Consumer investment services income increased $2.2 million as a result of
higher sales volumes of mutual funds and annuity products. Credit card and
interchange income also increased. The 10.8% increase in credit card income
reflects a higher level of AmSouth's customers activity and an increased
number of cardholder accounts. Interchange income increased 54.1% due to the
introduction in 1995 of the AmSouth CheckCard(sm). Offsetting these increases
were decreases in mortgage income of $7.2 million, the result of the sale of
the corporation's third-party mortgage servicing portfolio in June 1995, and
decreases in other operating revenues of $1.4 million related to management's
decision to scale down the institutional bond sales area within the
correspondent banking division. Excluding income from these areas, noninterest
revenues for 1996 increased approximately 15.0% compared to 1995.
Noninterest expenses for the three months ended March 31, 1996 totaled
$122.8 million compared to $131.6 million for the same period of the prior
year. Salaries and employee benefits decreased $1.9 million, or 3.2%. Salaries
decreased $2.9 million, reflecting a decline in the number of employees due to
branch and business consolidations. Employee benefits increased $1.0 million
primarily due to a higher company match of employee thrift plan contributions.
Increases in net occupancy expense and equipment expense are related to a
lease in a new office complex and investments in technology for the consumer
and commercial lines of business. Other significant changes in noninterest
expenses include a $4.6 million decrease in Federal Deposit Insurance
Corporation (FDIC) premiums and a $4.7 million decrease in the amortization of
intangibles. FDIC premiums are lower as a result of the FDIC reducing the
premium rate on deposits insured by the Bank Insurance Fund (BIF) to zero
beginning in 1996. The decrease in amortization of intangibles is due to the
elimination of purchased mortgage servicing rights when the corporation's
third-party mortgage servicing portfolio was sold in June 1995.
Capital Adequacy and Shareholders' Equity
-----------------------------------------
At March 31, 1996, shareholders' equity totaled $1.4 billion or 7.64% of
total assets. Since December 31, 1995, shareholders' equity has decreased
$13.9 million due to the purchase of 1,000,000 shares of AmSouth common stock
for $39.4 million to provide shares for AmSouth's employee benefit and
dividend reinvestment plans and other corporate purposes. This purchase
completes a program to repurchase 2,265,000 shares. Partially offsetting this
decrease was net income of $47.2 million, reduced by dividends of $22.6
million. Table 10 presents the calculation of the risk-adjusted capital ratios
for AmSouth at March 31, 1996 and 1995. At March 31, 1996, AmSouth remained
above the regulatory minimum required risk-adjusted Tier 1 Capital Ratio of
4.00% and the regulatory minimum required risk-adjusted Total Capital Ratio of
8.00%. In addition, the risk-adjusted capital ratios for AmSouth's banking
subsidiaries were above the regulatory minimum and each subsidiary was well-
capitalized at March 31, 1996.
Regulatory Developments
-----------------------
Effective January 1, 1996, the FDIC assessment schedule for BIF deposits
ranged from 0 to 27 cents per $100 of such deposits, based on each
institution's risk classification. Under this assessment schedule, AmSouth's
current assessment for BIF deposits is zero. The FDIC has maintaned the
assessment rate schedule of 23 to 31 cents per $100 of deposits insured by the
Savings Association Insurance Fund (SAIF). AmSouth's SAIF assessment rate is
currently 23 cents per $100 of deposits. At March 31, 1996, AmSouth had a BIF
deposit assessment base of $8.5 billion and a SAIF deposit base of $4.6
billion. Legislation has been under consideration in the U.S. Congress which
would charge a special one-time assessment on SAIF insured deposits to
recapitalize the SAIF to its statutorily mandated minimum designated reserve
ratio of 1.25 percent. Under the current proposal, an assessment at a rate of
between 75 and 85 cents per $100 of SAIF insured deposits would be
11
<PAGE>
imposed. Included in the proposed legislation under consideration is a
proposal to lower the special assessment for those institutions with SAIF
deposits meeting certain qualifications. The reduction would be achieved by
lowering the SAIF deposit assessment base for such institutions by 20 percent
prior to the calculation of the special charge. AmSouth believes that most of
its SAIF deposits would qualify for this treatment under a current version of
this legislation under consideration and, as a result, would incur a one-time
cost of approximately $26.0 to $31.0 million on a pre-tax basis if the
legislation is passed as currently drafted. The charge to earnings would not
occur until the law has been enacted. Due to the uncertain nature of
legislative affairs, management cannot predict with any degree of accuracy
when the legislation would be enacted, if at all, or what form the final
legislation may take.
TABLE 1--FINANCIAL SUMMARY
<TABLE>
<CAPTION>
MARCH 31
--------------------------
%
1996 1995 CHANGE
------------ ------------ -----------
(IN THOUSANDS EXCEPT PER SHARE DATA)
<S> <C> <C> <C> <C>
BALANCE SHEET SUMMARY
End-of-period balances:
Loans net of unearned income..... $ 11,476,197 $ 11,745,115 (2.3)%
Total securities................. 5,113,212* 3,764,162* 35.8
Total assets..................... 17,914,386 17,067,905 5.0
Total deposits................... 13,252,486 13,349,957 (0.7)
Shareholders' equity............. 1,369,554 1,335,191 2.6
Year-to-date average balances:
Loans net of unearned income..... $ 11,673,313 $ 11,561,740 1.0%
Total securities................. 4,748,731* 3,846,149* 23.5
Total assets..................... 17,683,545 16,876,928 4.8
Total deposits................... 13,169,187 13,101,782 0.5
Shareholders' equity............. 1,376,686 1,324,151 4.0
<CAPTION>
THREE MONTHS
ENDED MARCH 31
--------------------------
%
1996 1995 CHANGE
------------ ------------ -----------
<S> <C> <C> <C> <C>
EARNINGS SUMMARY
Net income....................... $ 47,163 $ 40,110 17.6%
Per common share................. 0.83 0.69 20.3
SELECTED RATIOS
Return on average assets
(annualized).................... 1.07% 0.96%
Return on average equity
(annualized).................... 13.78 12.28
Average equity to average
assets.......................... 7.79 7.85
Allowance for loan losses to
loans net of unearned income.... 1.55 1.48
Efficiency ratio................. 57.05 64.14
Dividend payout ratio............ 48.19 55.07
COMMON STOCK DATA
Cash dividends declared.......... $ 0.40 $ 0.38
Book value at end of period...... 24.26 22.95
Market value at end of period.... 38.88 31.50
Average common shares
outstanding..................... 57,021 58,103
</TABLE>
- --------
* Includes adjustment for market valuation on available-for-sale securities of
$26,947 and $(343) for end of period balances and $31,764 and $(2,416) for
year-to-date average balances for 1996 and 1995, respectively.
12
<PAGE>
TABLE 2--QUARTERLY YIELDS EARNED ON AVERAGE EARNING ASSETS AND RATES PAID ON
AVERAGE INTEREST-BEARING LIABILITIES
<TABLE>
<CAPTION>
1996 1995
---------------------------- ----------------------------------------------------------
FIRST QUARTER FOURTH QUARTER THIRD QUARTER
---------------------------- ---------------------------- ----------------------------
AVERAGE REVENUE/ YIELD/ AVERAGE REVENUE/ YIELD/ AVERAGE REVENUE/ YIELD/
BALANCE EXPENSE RATE BALANCE EXPENSE RATE BALANCE EXPENSE RATE
----------- -------- ------ ----------- -------- ------ ----------- -------- ------
(TAXABLE EQUIVALENT BASIS-DOLLARS IN THOUSANDS)
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
ASSETS
Earning assets:
Loans net of
unearned income.. $11,673,313 $251,472 8.66% $11,806,113 $257,968 8.67% $11,816,908 $256,878 8.62%
Trading
securities....... 3,778 41 4.36 5,348 29 2.15 2,797 27 3.83
Available-for-
sale securities.. 2,354,687 38,472 6.57 642,444 10,627 6.56 496,588 8,900 7.11
Held-to-maturity
securities:
Taxable.......... 2,142,855 36,259 6.81 3,158,591 52,453 6.59 2,908,333 48,044 6.55
Tax-free......... 215,647 5,912 11.03 232,750 6,315 10.76 255,893 6,957 10.79
----------- -------- ----------- -------- ----------- --------
Total held-to-
maturity
securities....... 2,358,502 42,171 7.19 3,391,341 58,768 6.88 3,164,226 55,001 6.90
----------- -------- ----------- -------- ----------- --------
Total
securities...... 4,716,967 80,684 6.88 4,039,133 69,424 6.82 3,663,611 63,928 6.92
Other earning
assets........... 106,629 1,760 6.64 73,533 1,310 7.07 87,315 1,205 5.48
----------- -------- ----------- -------- ----------- --------
Total earning
assets.......... 16,496,909 333,916 8.14 15,918,779 328,702 8.19 15,567,834 322,011 8.21
Cash and other
assets........... 1,333,274 1,413,087 1,404,025
Allowance for
loan losses...... (178,402) (178,948) (179,588)
Market valuation
on available-for-
sale securities.. 31,764 5,761 4,324
----------- ----------- -----------
$17,683,545 $17,158,679 $16,796,595
=========== =========== ===========
LIABILITIES AND
SHAREHOLDERS'
EQUITY
Interest-bearing
liabilities:
Interest-bearing
demand deposits.. $ 3,846,787 30,356 3.17 $ 3,823,303 31,756 3.30 $ 3,830,799 33,139 3.43
Savings
deposits......... 1,014,277 6,682 2.65 1,002,444 6,810 2.70 986,486 6,805 2.74
Time deposits.... 5,663,879 82,600 5.87 5,709,120 84,805 5.89 5,792,071 85,870 5.88
Certificates of
deposit of
$100,000 or
more............. 928,322 13,348 5.78 997,469 15,120 6.01 919,357 14,018 6.05
Federal funds
purchased and
securities sold
under agreements
to repurchase.... 1,674,720 21,805 5.24 1,388,274 19,329 5.52 1,044,177 14,966 5.69
Other interest-
bearing
liabilities...... 1,251,371 18,868 6.06 894,723 14,911 6.61 913,192 14,908 6.48
----------- -------- ----------- -------- ----------- --------
Total interest-
bearing
liabilities..... 14,379,356 173,659 4.86 13,815,333 172,731 4.96 13,486,082 169,706 4.99
-------- ----- -------- ----- -------- -----
Incremental
interest spread.. 3.28% 3.23% 3.22%
===== ===== =====
Noninterest-
bearing demand
deposits......... 1,715,922 1,738,426 1,730,937
Other
liabilities...... 211,581 221,993 213,217
Shareholders'
equity........... 1,376,686 1,382,927 1,366,359
----------- ----------- -----------
$17,683,545 $17,158,679 $16,796,595
=========== =========== ===========
Net interest
income/margin on
a taxable
equivalent
basis............ 160,257 3.91% 155,971 3.89% 152,305 3.88%
===== ===== =====
Taxable
equivalent
adjustment:
Loans............ 602 682 745
Securities....... 1,950 2,083 2,295
-------- -------- --------
Total taxable
equivalent
adjustment...... 2,552 2,765 3,040
-------- -------- --------
Net interest
income.......... $157,705 $153,206 $149,265
======== ======== ========
1995
----------------------------------------------------------
SECOND QUARTER FIRST QUARTER
---------------------------- ----------------------------
AVERAGE REVENUE/ YIELD/ AVERAGE REVENUE/ YIELD/
BALANCE EXPENSE RATE BALANCE EXPENSE RATE
----------- -------- ------ ----------- -------- ------
(TAXABLE EQUIVALENT BASIS-DOLLARS IN THOUSANDS)
<S> <C> <C> <C> <C> <C> <C>
ASSETS
Earning assets:
Loans net of
unearned income.. $11,801,298 $254,751 8.66% $11,561,740 $244,691 8.58%
Trading
securities....... 9,194 106 4.62 10,395 157 6.13
Available-for-
sale securities.. 477,809 8,608 7.23 534,967 9,899 7.50
Held-to-maturity
securities:
Taxable.......... 2,970,284 48,378 6.53 3,019,065 48,770 6.55
Tax-free......... 273,382 7,531 11.05 284,138 7,638 10.90
----------- -------- ----------- --------
Total held-to-
maturity
securities....... 3,243,666 55,909 6.91 3,303,203 56,408 6.93
----------- -------- ----------- --------
Total
securities...... 3,730,669 64,623 6.95 3,848,565 66,464 7.00
Other earning
assets........... 90,660 1,868 8.26 125,537 2,190 7.07
----------- -------- ----------- --------
Total earning
assets.......... 15,622,627 321,242 8.25 15,535,842 313,345 8.18
Cash and other
assets........... 1,479,463 1,516,028
Allowance for
loan losses...... (175,616) (172,526)
Market valuation
on available-for-
sale securities.. 1,985 (2,416)
----------- -----------
$16,928,459 $16,876,928
=========== ===========
LIABILITIES AND
SHAREHOLDERS'
EQUITY
Interest-bearing
liabilities:
Interest-bearing
demand deposits.. $ 3,901,245 36,849 3.79 $ 4,022,419 38,110 3.84
Savings
deposits......... 949,737 7,178 3.03 903,844 6,707 3.01
Time deposits.... 5,874,024 84,198 5.75 5,553,978 72,964 5.33
Certificates of
deposit of
$100,000 or
more............. 911,668 13,537 5.96 865,568 11,604 5.44
Federal funds
purchased and
securities sold
under agreements
to repurchase.... 946,492 14,518 6.15 1,247,584 18,369 5.97
Other interest-
bearing
liabilities...... 993,363 16,102 6.50 1,056,203 16,823 6.46
----------- -------- ----------- --------
Total interest-
bearing
liabilities..... 13,576,529 172,382 5.09 13,649,596 164,577 4.89
-------- ----- -------- -----
Incremental
interest spread.. 3.16% 3.29%
===== =====
Noninterest-
bearing demand
deposits......... 1,798,087 1,755,973
Other
liabilities...... 212,513 147,208
Shareholders'
equity........... 1,341,330 1,324,151
----------- -----------
$16,928,459 $16,876,928
=========== ===========
Net interest
income/margin on
a taxable
equivalent
basis............ 148,860 3.82% 148,768 3.88%
===== =====
Taxable
equivalent
adjustment:
Loans............ 784 757
Securities....... 2,488 2,527
-------- --------
Total taxable
equivalent
adjustment...... 3,272 3,284
-------- --------
Net interest
income.......... $145,588 $145,484
======== ========
</TABLE>
- ----
Note: The taxable equivalent adjustment has been computed based on a 35%
federal income tax rate.
13
<PAGE>
TABLE 3--INTEREST RATE SWAPS, CAPS AND FLOORS
<TABLE>
<CAPTION>
SWAPS
----------------------------------- CAPS
RECEIVE FIXED PAY FIXED BASIS OTHER & FLOORS TOTAL
------------- --------- ----- ----- -------- ------
(IN MILLIONS)
<S> <C> <C> <C> <C> <C> <C>
Balance at January 1,
1996..................... $150 $-0- $-0- $-0- $1,110 $1,260
Additions............... -0- -0- -0- -0- -0- -0-
Maturities.............. -0- -0- -0- -0- -0- -0-
Calls................... -0- -0- -0- -0- -0- -0-
Terminations............ -0- -0- -0- -0- -0- -0-
---- ---- ---- ---- ------ ------
Balance at March 31,
1996..................... $150 $-0- $-0- $-0- $1,110 $1,260
==== ==== ==== ==== ====== ======
</TABLE>
TABLE 4--MATURITIES ON CAPS AND INTEREST RATES EXCHANGED ON SWAPS
<TABLE>
<CAPTION>
MATURE DURING
----------------------------------
1996 1997 1998 1999 2000 TOTAL
----- ----- ----- ----- ------ ------
(DOLLARS IN MILLIONS)
<S> <C> <C> <C> <C> <C> <C>
Receive fixed swaps:
Notional amount................... $ 150 $ -0- $ -0- $ -0- $ -0- $ 150
Receive rate...................... 6.28% 0.00% 0.00% 0.00% 0.00% 6.28%
Pay rate.......................... 5.41% 0.00% 0.00% 0.00% 0.00% 5.41%
Caps:
Notional amount................... $ 33 $ 77 $ -0- $ -0- $1,000 $1,110
</TABLE>
- --------
Note: The maturities and interest rates exchanged are calculated assuming that
interest rates remain unchanged from average March 1996 rates. The information
presented could change as future interest rates increase or decrease.
14
<PAGE>
TABLE 5--LOANS AND CREDIT QUALITY
<TABLE>
<CAPTION>
NET CHARGE-
LOANS NONPERFORMING LOANS* OFFS
MARCH 31 MARCH 31 MARCH 31
----------------------- -------------------- ---------------
1996 1995 1996 1995 1996 1995
----------- ----------- -------------------- ------- ------
(IN THOUSANDS)
<S> <C> <C> <C> <C> <C> <C>
Commercial.............. $ 3,106,683 $ 2,890,408 $ 17,096 $ 17,465 $ (553) $1,006
Commercial real estate:
Mortgages.............. 1,567,291 1,359,761 35,377 33,051 573 185
Real estate
construction.......... 586,904 561,346 1,950 12,039 (246) 312
----------- ----------- --------- ---------- ------- ------
Total commercial real
estate................ 2,154,195 1,921,107 37,327 45,090 327 497
----------- ----------- --------- ---------- ------- ------
Consumer:
Residential first
mortgages............. 3,410,054 4,387,423 31,141 27,264 784 226
Other residential
mortgages............. 701,321 637,925 980 -0- 24 20
Dealer indirect........ 1,074,124 933,655 3,384 859 5,565 1,227
Revolving credit....... 470,292 345,829 -0- -0- 6,388 2,951
Other consumer......... 629,338 681,755 991 12,067 3,106 939
----------- ----------- --------- ---------- ------- ------
Total consumer......... 6,285,129 6,986,587 36,496 40,190 15,867 5,363
----------- ----------- --------- ---------- ------- ------
$11,546,007 $11,798,102 $ 90,919 $ 102,745 $15,641 $6,866
=========== =========== ========= ========== ======= ======
</TABLE>
- --------
* Exclusive of accruing loans 90 days past due.
TABLE 6--ALLOWANCE FOR LOAN LOSSES
<TABLE>
<CAPTION>
1996 1995
----------- -----------------------------------------------
1ST QUARTER 4TH QUARTER 3RD QUARTER 2ND QUARTER 1ST QUARTER
----------- ----------- ----------- ----------- -----------
(DOLLARS IN THOUSANDS)
<S> <C> <C> <C> <C> <C>
Balance at beginning of
period................. $178,451 $179,550 $179,002 $174,398 $171,167
Loans charged off....... 20,626 13,998 12,290 11,833 9,161
Recoveries of loans
previously charged
off.................... 4,985 2,809 3,440 4,130 2,295
-------- -------- -------- -------- --------
Net charge-offs......... 15,641 11,189 8,850 7,703 6,866
Addition to allowance
charged to expense..... 15,120 10,090 9,398 12,307 8,344
Allowance acquired in
acquisitions........... -0- -0- -0- -0- 1,753
-------- -------- -------- -------- --------
Balance at end of
period................. $177,930 $178,451 $179,550 $179,002 $174,398
======== ======== ======== ======== ========
Allowance for loan
losses to loans net of
unearned income........ 1.55% 1.52% 1.51% 1.50% 1.48%
Allowance for loan
losses to nonperforming
loans.................. 195.70% 185.41% 200.94% 186.25% 169.74%
Allowance for loan
losses to nonperforming
assets................. 163.06% 154.49% 171.73% 153.98% 134.67%
Net charge-offs to
average loans net of
unearned income
(annualized)........... 0.54% 0.38% 0.30% 0.26% 0.24%
</TABLE>
15
<PAGE>
TABLE 7--NONPERFORMING ASSETS
<TABLE>
<CAPTION>
1996 1995
-------- -------------------------------------------
MARCH 31 DECEMBER 31 SEPTEMBER 30 JUNE 30 MARCH 31
-------- ----------- ------------ -------- --------
(DOLLARS IN THOUSANDS)
<S> <C> <C> <C> <C> <C>
Nonaccrual loans........ $ 90,919 $ 96,246 $ 89,355 $ 96,111 $101,964
Restructured loans...... -0- -0- -0- -0- 781
-------- -------- -------- -------- --------
Total nonperforming
loans................ 90,919 96,246 89,355 96,111 102,745
Foreclosed properties... 14,764 16,150 13,144 18,112 24,656
Repossessions........... 3,439 3,114 2,052 2,028 2,097
-------- -------- -------- -------- --------
Total nonperforming
assets*.............. $109,122 $115,510 $104,551 $116,251 $129,498
======== ======== ======== ======== ========
Nonperforming assets* to
loans net of unearned
income, foreclosed
properties and
repossessions.......... 0.95% 0.98% 0.88% 0.97% 1.10%
Accruing loans 90 days
past due............... $ 40,110 $ 39,618 $ 45,548 $ 34,663 $ 33,685
</TABLE>
- --------
* Exclusive of accruing loans 90 days past due.
16
<PAGE>
TABLE 8--SECURITIES
<TABLE>
<CAPTION>
MARCH 31, 1996 MARCH 31, 1995
--------------------- ---------------------
CARRYING MARKET CARRYING MARKET
AMOUNT VALUE AMOUNT VALUE
---------- ---------- ---------- ----------
(IN THOUSANDS)
<S> <C> <C> <C> <C>
Held-to-maturity
U.S. Treasury and federal agency
securities...................... $2,109,300 $2,093,261 $2,986,023 $2,906,756
State, county and municipal
securities...................... 208,929 219,273 280,053 292,955
Other securities................. 256,682 253,336 6,550 6,464
---------- ---------- ---------- ----------
$2,574,911 $2,565,870 $3,272,626 $3,206,175
========== ========== ========== ==========
Available-for-sale
U.S. Treasury and federal agency
securities...................... $2,299,853 $ 334,980
Other securities................. 234,938 146,071
---------- ----------
$2,534,791 $ 481,051
========== ==========
</TABLE>
- --------
Notes:
- -----
1. The weighted average remaining life, which reflects the amortization on
mortgage related and other asset-backed securities, and the weighted
average yield on the combined held-to-maturity and available-for-sale
portfolios at March 31, 1996 were approximately 4.6 years and 6.91%,
respectively. Included in the balance was $3.9 billion of mortgage-backed
securities, $1.5 billion of which were variable rate. The weighted average
remaining life and the weighted average yield of mortgage-backed securities
at March 31, 1996 were approximately 5.2 years and 6.88%, respectively. The
duration of the combined portfolios, which considers the repricing
frequency of variable rate securities, is approximately 2.1 years.
2. The available-for-sale portfolio included a net unrealized gain of $26.9
million and a net unrealized loss of $343 thousand at March 31, 1996 and
1995, respectively.
TABLE 9--OTHER INTEREST-BEARING LIABILITIES
<TABLE>
<CAPTION>
MARCH 31
-------------------
1996 1995
---------- --------
(IN THOUSANDS)
<S> <C> <C>
Short-term:
Treasury, tax, and loan note............................. $ 283,690 $127,014
Federal Home Loan Bank advances.......................... 183,000 282,950
Term federal funds purchased............................. -0- 158,000
Floating Rate Notes Due 1999............................. 6,899 7,147
Other.................................................... 52,310 18,114
---------- --------
Total short-term....................................... 525,899 593,225
---------- --------
Long-term:
Federal Home Loan Bank advances.......................... 234,195 68,634
6.75% Subordinated Debentures Due 2025................... 149,832 -0-
7.75% Subordinated Notes Due 2004........................ 149,252 149,160
Subordinated Capital Notes Due 1999...................... 99,602 99,473
7.50% Convertible Subordinated Debentures................ 4,097 3,876
Long-term notes payable.................................. 23,518 23,183
---------- --------
Total long-term........................................ 660,496 344,326
---------- --------
Total other interest-bearing liabilities............... $1,186,395 $937,551
========== ========
</TABLE>
17
<PAGE>
TABLE 10--CAPITAL RATIOS
<TABLE>
<CAPTION>
MARCH 31
------------------------
1996 1995
----------- -----------
(DOLLARS IN THOUSANDS)
<S> <C> <C>
Risk-adjusted capital ratio:
Total assets....................................... $17,914,386 $17,067,905
Adjusted allowance for loan losses................. 167,914 157,137
Adjustment for risk-weighting of balance sheet
items............................................. (6,473,827) (6,023,181)
Adjustment for off-balance sheet items............. 2,123,225 1,643,029
Unrealized (gains)/losses on available-for-sale
securities........................................ (27,417) 343
Less certain intangible assets..................... (280,556) (291,568)
----------- -----------
Total risk-adjusted assets....................... $13,423,725 $12,553,665
=========== ===========
Shareholders' equity............................... $ 1,369,554 $ 1,335,191
Unrealized (gains)/losses on available-for-sale
securities
(net of deferred taxes)........................... (17,344) 200
Less certain intangible assets..................... (280,556) (291,568)
----------- -----------
Tier I capital..................................... 1,071,654 1,043,823
Adjusted allowance for loan losses................. 167,914 157,137
Qualifying long-term debt.......................... 358,845 229,513
----------- -----------
Tier II capital.................................... 526,759 386,650
----------- -----------
Total capital.................................... $ 1,598,413 $ 1,430,473
=========== ===========
Tier I capital to total risk-adjusted assets....... 7.98% 8.31%
Total capital to risk-adjusted assets.............. 11.91% 11.39%
Other capital ratios:
Leverage........................................... 6.16% 6.29%
Equity to assets................................... 7.64% 7.82%
Tangible equity to assets.......................... 6.17% 5.87%
</TABLE>
18
<PAGE>
PART II
OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS
Several of AmSouth's subsidiaries are defendants in legal proceedings
arising in the ordinary course of business. Some of these proceedings seek
relief or damages that are substantial. The actions relate to AmSouth's
lending, collections, servicing, investment, trust and other activities.
Among the actions which are pending against AmSouth subsidiaries are actions
filed as class actions in the State of Alabama. The actions are similar to
others that have been brought in recent years in Alabama against financial
institutions in that they seek punitive damage awards in transactions
involving relatively small amounts of actual damages. In recent years, juries
in Alabama state courts have made large punitive damage awards in such cases.
Legislation which would limit these lawsuits has been proposed in the Alabama
legislature but has not been enacted into law. AmSouth cannot predict whether
any such legislation will be enacted.
It may take a number of years to finally resolve some of these legal
proceedings pending against AmSouth subsidiaries, due to their complexity and
for other reasons. It is not possible to determine with any certainty at this
time the corporation's potential exposure from the proceedings. However, based
upon the advice of legal counsel, AmSouth's management is of the opinion that
the ultimate resolution of these legal proceedings will not have a material
adverse effect on AmSouth's financial condition or results of operations.
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
The regular Annual Meeting of Shareholders of AmSouth was held on April 18,
1996, at which meeting the shareholders (a) elected four nominees as directors
and (b) voted to approve the 1996 Long Term Incentive Compensation Plan. The
following is a tabulation of the voting on these matters.
ELECTION OF DIRECTORS
<TABLE>
<CAPTION>
VOTES BROKER
NAME VOTES FOR WITHHELD ABSTENTIONS NONVOTES
- ---- ---------- -------- ----------- --------
<S> <C> <C> <C> <C>
J. Harold Chandler..................... 47,374,024 317,285 N/A N/A
Rodney C. Gilbert...................... 47,371,030 320,279 N/A N/A
Elmer B. Harris........................ 47,301,051 390,258 N/A N/A
James R. Malone........................ 47,357,838 333,471 N/A N/A
</TABLE>
APPROVAL OF 1996 LONG TERM
INCENTIVE COMPENSATION PLAN
<TABLE>
<CAPTION>
VOTES FOR VOTES AGAINST ABSTENTIONS BROKER NONVOTES
--------- ------------- ----------- ---------------
<S> <C> <C> <C>
42,556,355 3,227,778 1,907,176 -0-
</TABLE>
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
ITEM 6(A)--EXHIBITS
The exhibits listed in the Exhibit Index at page 21 of this Form 10-Q are
filed herewith or are incorporated by reference herein.
ITEM 6(B)--FORMS 8-K
No report on Form 8-K was filed by AmSouth during the period January 1, 1996
to March 31, 1996.
19
<PAGE>
SIGNATURES
PURSUANT TO THE REQUIREMENTS OF THE SECURITIES EXCHANGE ACT OF 1934, AMSOUTH
HAS DULY CAUSED THIS REPORT TO BE SIGNED ON ITS BEHALF BY THE UNDERSIGNED
THEREUNTO DULY AUTHORIZED.
May 13, 1996 /s/ C. Dowd Ritter
By: _________________________________
C. Dowd Ritter
President and Chief Executive Officer
May 13, 1996 /s/ Dennis J. Dill
By: _________________________________
Dennis J. Dill
Executive Vice President
Chief Accounting Officer
20
<PAGE>
EXHIBIT INDEX
The following is a list of exhibits including items incorporated by
reference.
<TABLE>
<S> <C>
3-a Restated Certificate of Incorporation of AmSouth Bancorporation (1)
3-b Bylaws of AmSouth Bancorporation, as amended
10-a AmSouth Bancorporation 1996 Long Term Incentive Compensation Plan
10-b Amendment to Employment Agreement for C. Dowd Ritter
10-c Amendment to Form of Executive Severance Agreement for Certain Executive
Officers
11 Statement Re: Computation of Earnings per Share
15 Letter Re: Unaudited Interim Financial Information
27 Financial Data Schedule
</TABLE>
21
<PAGE>
NOTES TO EXHIBITS
(1) Filed as Exhibit 3-b to AmSouth's Form 10-Q Quarterly Report for the
quarter ended March 31, 1993, incorporated herein by reference.
22
<PAGE>
Exhibit 3-b
AMSOUTH BANCORPORATION BYLAWS
ARTICLE 1 - OFFICES
-------------------
SECTION 1.1: PRINCIPAL EXECUTIVE OFFICE AND OTHER OFFICES
The principal executive office of the corporation shall be at such
place, either within or without the State of Alabama, as may be designated from
time to time by the Board of Directors. The corporation may have such other
offices, either within or without the State of Alabama, as the Board of
Directors may designate or as the business of the corporation may require from
time to time.
ARTICLE 2 - SHAREHOLDER MEETINGS
--------------------------------
SECTION 2.1: ANNUAL MEETING
The annual meeting of the shareholders of the corporation shall be held
on such date and at such time as may be fixed by resolution of the Board of
Directors, for the purpose of electing directors and for the transaction of such
other business as may come before the meeting. If the day fixed for the annual
meeting is a legal holiday in the state in which the meeting is to be held, the
meeting shall be held on the next succeeding business day. If the election of
directors shall not be held on the day fixed by the Board of Directors for any
annual meeting of the shareholders, or at any adjournment thereof, the Board of
Directors shall cause the election to be held at a special meeting of the
shareholders as soon thereafter as convenient.
SECTION 2.2: SPECIAL MEETINGS
Special meetings of the shareholders, for any purpose or purposes, may
be called only as provided in the Restated Certificate of Incorporation.
<PAGE>
SECTION 2.3: PLACE OF MEETING
The place of meeting shall be the principal executive office of the
corporation unless some other place, either within or without the State of
Alabama, is designated by the Board of Directors.
SECTION 2.4: NOTICE OF MEETING: FORM; CONTENTS; DELIVERY METHOD; DELIVERY
TIME
Written notice stating (a) the place, day, and hour of the meeting and
(b) in the case of a special meeting, a meeting that is required by statute to
be held for any special purpose, or an annual meeting at which special action is
to be taken, the purpose or purposes for which the meeting is called, or the
special action proposed to be taken, shall be delivered either personally or by
mail, by or at the direction of the Board of Directors, the Chief Executive
Officer, the Secretary, or the persons calling the meeting, to each shareholder
of record entitled to vote at such meeting. If mailed, such notice shall be
deemed to be given when deposited in the United States mail addressed to the
shareholder at the shareholder's address as it appears on the records of the
corporation, with postage thereon prepaid. Any such notice that relates to an
annual meeting of shareholders shall be delivered not less than ten (10) nor
more than sixty (60) days before the date of the meeting; and any such notice
that relates to any special meeting of shareholders shall be delivered as
provided in the Restated Certificate of Incorporation. An affidavit of the
Secretary or an Assistant Secretary or the transfer agent of the corporation
that notice has been given shall, in the absence of fraud, be prima facie
evidence of the facts stated therein.
When a meeting is adjourned to another time or place, notice need not be
given of the adjourned meeting if the time and place thereof are announced at
the meeting at which the adjournment is taken. At the adjourned meeting the
shareholders may transact any business that might have been transacted at the
original meeting. If the adjournment is for more than 30 days, or if after the
adjournment a new record date is fixed for the adjourned meeting, a notice of
the adjourned meeting shall be given to each shareholder of record entitled to
vote at the meeting.
Any shareholder may waive notice of any meeting in the manner provided
in Section 9.1 of these bylaws. Attendance of a shareholder at a meeting of
shareholders shall constitute a waiver of notice of such a meeting, except when
the shareholder attends a meeting for the express purpose of objecting at the
beginning of the meeting to the transaction of any business because the meeting
is not lawfully called or convened.
-2-
<PAGE>
Any previously scheduled meeting of the shareholders (other than a
meeting called by shareholders under Section VII(b) of the Restated Certificate
of Incorporation) may be postponed, and any special meeting of the shareholders
(other than a meeting called by shareholders of the corporation under Section
VII(b) of the Restated Certificate of Incorporation) may be cancelled, by
resolution of the Board of Directors upon public announcement (as defined in
Section 2.12(C)(2) of these bylaws) given prior to the time previously scheduled
for such meeting of shareholders.
SECTION 2.5: FIXING OF RECORD DATE
In order that the corporation may determine the shareholders entitled to
notice of or to vote at any meeting of shareholders or any adjournment thereof,
the Board of Directors may fix a record date, which record date shall not
precede the date upon which the resolution fixing the record date is adopted by
the Board of Directors, and which record date shall be not more than sixty (60)
nor less than ten (10) days before the date of such meeting. If no record date
is fixed by the Board of Directors, the record date for determining
shareholders entitled to notice of or to vote at a meeting of shareholders
shall be at the close of business on the date next preceding the day on which
notice is given, or, if notice is waived, at the close of business on the day
next preceding the day on which the meeting is held. A determination of
shareholders of record entitled to notice of or to vote at a meeting of
shareholders shall apply to any adjournment of the meeting; provided, however,
that the Board of Directors may fix a new record date for the adjourned meeting.
SECTION 2.6: VOTING LISTS
The officer having charge of the stock ledger for shares of the
corporation shall make, at least ten (10) days before each meeting of
shareholders, a complete list of the shareholders entitled to vote at such
meeting, or any adjournment thereof, arranged in alphabetical order, with the
address and the number of shares registered in the name of each shareholder,
which list, for a period of ten (10) days prior to such meeting, shall be kept
on file at the principal office of the corporation and shall be subject to
inspection by any shareholder, for any purpose germane to the meeting, at any
time during usual business hours. Such list shall also be produced and kept open
at the time and place of the meeting and shall be subject to the inspection of
any shareholder during the whole time of the meeting. The original stock ledger
shall be the only evidence as to who are the shareholders entitled to examine
such list or stock ledger or books of the corporation or to vote in person or by
proxy at any meeting of shareholders.
-3-
<PAGE>
SECTION 2.7: QUORUM
A majority of the outstanding shares of the corporation entitled to
vote, present in person or represented by proxy, shall constitute a quorum at a
meeting of shareholders. If less than a majority of the outstanding shares
entitled to vote are represented at a meeting, a majority of the shares so
represented may adjourn the meeting from time to time without further notice. At
such adjourned meeting at which a quorum shall be present or represented, any
business may be transacted that might have been transacted at the meeting under
the original notice. The shareholders present at a duly organized meeting may
continue to transact business until the meeting is adjourned, notwithstanding
the withdrawal of enough shareholders to leave less than a quorum.
SECTION 2.8: PROXIES
At all meetings of shareholders, a shareholder may vote by proxy in
writing executed by the shareholder or by the shareholder's duly authorized
attorney in fact. Such proxy shall be filed with the Secretary of the
corporation before or at the time of the meeting. No proxy shall be valid after
eleven (11) months from the date of its execution, unless otherwise provided in
the proxy.
SECTION 2.9: VOTING OF SHARES
Each outstanding share entitled to vote shall be entitled to one (1)
vote upon each matter submitted to a vote at a meeting of the shareholders.
Directors shall be elected by a plurality of the votes of the shares present in
person or represented by a proxy at the meeting and entitled to vote on the
election of directors. In all matters other than the election of directors, the
affirmative vote of a majority of shares present in person or represented by a
proxy at the meeting and entitled to vote on the subject matter shall be the act
of the shareholders, except as otherwise provided in the Restated Certificate of
Incorporation or as otherwise required by Delaware law.
-4-
<PAGE>
Where a separate vote by class or classes is required, a majority of the
outstanding shares of such class or classes, present in person or represented
by proxy, shall constitute a quorum entitled to take action with respect to
that vote on that matter, and the affirmative vote of a majority of the shares
of such class or classes present in person or represented by proxy at the
meeting shall be the act of such class, except as otherwise provided in the
Restated Certificate of Incorporation or as otherwise required by Delaware law.
The vote on all questions shall be taken in such manner as the Chairman
prescribes, provided, however, that all votes taken at any meeting of
shareholders, including, without limitation, votes taken with respect to the
election of directors, shall be by written ballot.
SECTION 2.10: VOTING OF SHARES BY CERTAIN HOLDERS
Except as provided in this paragraph, shares of the corporation standing
in the name of another corporation may be voted by such officer, agent, or proxy
as the bylaws of such corporation may prescribe, or, in the absence of such
provision, as the board of directors of such corporation may determine. Shares
of its own capital stock belonging to the corporation or to another corporation,
if a majority of the shares entitled to vote in the election of directors of
such other corporation is held, directly or indirectly, by the corporation,
shall neither be entitled to vote nor to be counted for quorum purposes;
provided, however, that nothing in this section shall be construed as limiting
the right of any corporation to vote stock, including but not limited to its own
stock, held by it in a fiduciary capacity.
Shares that have been called for redemption shall not be deemed to be
outstanding shares for the purpose of voting or determining the total number of
shares entitled to vote on any matter on and after the date on which written
notice of redemption has been sent to holders thereof and a sum sufficient to
redeem such shares has been irrevocably deposited or set aside to pay the
redemption price to the holders of the shares upon surrender of certificates
therefor.
Shares held by an administrator, executor, guardian, or conservator may
be voted by such person, either in person or by proxy, without a transfer of
such shares into such person's name. Shares standing in the name of a trustee
may be voted by such trustee, either in person or by proxy; but no trustee shall
be entitled to vote shares held by such trustee without a transfer of such
shares into such trustee's name.
-5-
<PAGE>
Shares standing in the name of a receiver may be voted by such receiver,
and shares held or under the control of a receiver may be voted by such
receiver without the transfer thereof into such receiver's name if authority so
to do is contained in an appropriate order of the court by which such receiver
was appointed.
A shareholder whose shares are pledged shall be entitled to vote such
shares unless in the transfer by the pledgor on the books of the corporation
the pledgor has expressly empowered the pledgee to vote thereon, in which case
only the pledgee, or the pledgee's proxy, may represent such shares and vote
thereon.
If shares or other securities of the corporation having voting powers
stand of record in the names of two (2) or more persons, whether fiduciaries,
members of a partnership, joint tenants, tenants in common, tenants by the
entirety or otherwise, or if two (2) or more persons have the same fiduciary
relationship respecting the same shares, unless the Secretary of the corporation
is given written notice to the contrary and is furnished with a copy of the
instrument or order appointing them or creating the relationship wherein it is
so provided, their acts with respect to voting shall have the following effect:
(a) If only one (1) votes, the act of such person binds all;
(b) If more than one (1) vote, the act of the majority so voting
binds all;
(c) If more than one (1) vote, but the vote is evenly split on any
particular matter, each fraction may vote the securities in
question proportionately. If the instrument so filed shows that
any such tenancy is held in unequal interests, a majority or
even split for the purpose of this section shall be a majority
or even split in interest.
SECTION 2.11: INSPECTORS
Prior to any meeting of shareholders, the Board of Directors or the
Chief Executive Officer shall appoint one or more inspectors to act at the
meeting and make a written report thereof and may designate one or more persons
as alternate inspectors to replace any inspector who fails to act. If no
inspector or alternate is able to act at the meeting of shareholders, the person
presiding at the meeting shall appoint one or more inspectors to act at the
meeting. Inspectors may, but are not required to be, employees of the
corporation or of its subsidiaries. Each inspector, before entering upon the
discharge of his or her duties, shall take and sign an oath faithfully to
execute the duties of inspector with strict impartiality and according to the
best of his or her ability.
-6-
<PAGE>
The inspectors shall ascertain the number of shares outstanding and the
voting power of each, determine the shares represented at the meeting and the
validity of proxies and ballots, count all votes and ballots, determine and
retain for a reasonable period a record of the disposition of any challenges
made to any determination by the inspectors and certify their determination of
the number of shares represented at the meeting and their count of all votes
and ballots. The inspectors may appoint or retain other persons or entities to
assist them in the performance of their duties.
The date and time of the opening and closing of the polls for each
matter upon which the shareholders will vote at a meeting shall be announced at
the meeting. No ballot, proxies, or votes, nor any revocations thereof or
changes thereto, shall be accepted by the inspectors after the closing of the
polls.
In determining the validity and counting of proxies and ballots, the
inspectors shall be limited to an examination of the proxies, any envelopes
submitted therewith, any information provided by a shareholder who submits a
proxy by telegram, cablegram, or other electronic transmission from which it
can be determined that the proxy was authorized by the shareholder, ballots,
and the regular books and records of the corporation, except that the
inspectors may also consider other reliable information for the limited purpose
of reconciling proxies and ballots submitted by or on behalf of banks, brokers,
their nominees or similar persons which represent more votes than the holder of
a proxy is authorized by the record owner to cast or more votes than the
shareholder holds of record. If the inspectors consider other reliable
information for such purpose, they shall, at the time they make their
certification, specify the precise information considered by them, including
the person or persons from whom they obtained the information, when the
information was obtained, the means by which the information was obtained and
the basis for the inspectors' belief that such information is accurate and
reliable.
-7-
<PAGE>
SECTION 2.12: NOTICE OF SHAREHOLDER BUSINESS AND NOMINATIONS
(A) Annual Meetings of Shareholders.
--------------------------------
(1) Nominations of persons for election to the Board of
Directors and the proposal of business to be considered by the shareholders may
be made at an annual meeting of shareholders (a) pursuant to the corporation's
notice of meeting, (b) by or at the direction of the Board of Directors or (c)
by any shareholder of the corporation who was a shareholder of record at the
time of giving of notice provided for in this bylaw, who is entitled to vote at
the meeting and who complies with the notice procedures set forth in this
Section 2.12.
(2) For nominations or other business to be properly brought
before an annual meeting by a shareholder pursuant to clause (c) of paragraph
(A)(1) of this Section 2.12, the shareholder must have given timely notice
thereof in writing to the Secretary of the corporation, and such other business
must otherwise be a proper matter for shareholder action. To be timely, a
shareholder's notice shall be delivered to the Secretary at the principal
executive office of the corporation not later than the close of business on the
sixtieth (60th) day nor earlier than the close of business on the ninetieth
(90th) day prior to the first anniversary of the preceding year's annual
meeting; provided, however, that in the event that the date of the annual
meeting is more than thirty (30) days before or more than sixty (60) days after
such anniversary date, notice by the shareholder to be timely must be so
delivered not earlier than the close of business on the ninetieth (90th) day
prior to such annual meeting and not later than the close of business on the
later of the sixtieth (60th) day prior to such annual meeting or the tenth
(10th) day following the day on which public announcement of the date of such
meeting is first made by the corporation. In no event shall the public
announcement of an adjournment of an annual meeting commence a new time period
for the giving of a shareholder's notice as described above. Such shareholder's
notice shall set forth (a) as to each person whom the shareholder proposes to
nominate for election or re-election as a director, all information relating to
such person that is required to be disclosed in solicitations of proxies for
election of directors in an election contest, or is otherwise required, in each
case pursuant to Regulation 14A under the Securities Exchange Act of 1934, as
-8-
<PAGE>
amended (the "Exchange Act") and Rule 14a-11 thereunder (including such person's
written consent to being named in the proxy statement as a nominee and to
serving as a director if elected); (b) as to any other business that the
shareholder proposes to bring before the meeting, a brief description of the
business desired to be brought before the meeting, the reasons for conducting
such business at the meeting and any material interest in such business of such
shareholder and the beneficial owner, if any, on whose behalf the proposal is
made; and (c) as to the shareholder giving the notice and the beneficial owner,
if any, on whose behalf the nomination or proposal is made (i) the name and
address of such shareholder, as they appear on the corporation's books, and of
such beneficial owner and (ii) the class and number of shares of the corporation
that are owned beneficially and of record by such shareholder and such
beneficial owner.
(3) Notwithstanding anything in the second sentence of paragraph
(A)(2) of this Section 2.12 to the contrary, if the number of directors to be
elected to the Board of Directors of the corporation is increased and there is
no public announcement by the corporation naming all of the nominees for
director or specifying the size of the increased Board of Directors at least
seventy (70) days prior to the first anniversary of the preceding year's annual
meeting, a shareholder's notice required by this bylaw shall also be considered
timely, but only with respect to nominees for any new positions created by such
increase, if it shall be delivered to the Secretary at the principal executive
office of the corporation not later than the close of business on the tenth
(10th) day following the day on which such public announcement is first made by
the corporation.
(B) Special Meetings of Shareholders. Only such business shall be
--------------------------------
conducted at a special meeting of shareholders as shall have been brought
before the meeting pursuant to the corporation's notice of meeting.
Nominations of persons for election to the Board of Directors may be made at a
special meeting of shareholders at which directors are to be elected pursuant
to the corporation's notice of meeting (a) by or at the direction of the Board
of Directors or (b) provided that the Board of Directors has determined that
directors shall be elected at such meeting, by any shareholder of the
corporation who is a shareholder of record at the time of giving of notice
provided for in this bylaw, who shall be entitled to vote at the meeting and
who complies with the notice procedures set forth in this Section 2.12. If the
corporation calls a special meeting of shareholders for the purpose of electing
one or more directors to the Board of Directors, any such shareholder may
nominate a person or persons (as the case may be), for election to such
-9-
<PAGE>
position(s) as specified in the corporation's notice of meeting, if the
shareholder's notice required by paragraph (A)(2) of this Section 2.12 shall be
delivered to the Secretary at the principal executive offices of the
corporation not earlier than the close of business on the ninetieth (90th) day
prior to such special meeting and not later than the close of business on the
later of the sixtieth (60th) day prior to such special meeting or the tenth
(10th) day following the day on which public announcement is first made of the
date of the special meeting and of the nominees proposed by the Board of
Directors to be elected at such meeting. In no event shall the public
announcement of an adjournment of a special meeting commence a new time period
for the giving of a shareholder's notice as described above.
(C) General.
-------
(1) Only such persons who are nominated in accordance with
the procedures set forth in this Section 2.12 shall be eligible to serve as
directors, and only such business shall be conducted at a meeting of
shareholders as shall have been brought before the meeting in accordance with
the procedures set forth in this Section 2.12. Except as otherwise provided by
law, the chairman of the meeting shall have the power and duty to determine
whether a nomination or any business proposed to be brought before the meeting
was made or proposed, as the case may be, in accordance with the procedures set
forth in this Section 2.12 and, if any proposed nomination or business is not in
compliance with this Section 2.12, to declare that such defective proposal or
nomination shall be disregarded.
(2) For purposes of this Section 2.12, "public announcement"
shall mean disclosure in a press release reported by the Dow Jones News Service,
Associated Press or comparable national news service or in a document publicly
filed by the corporation with the Securities and Exchange Commission pursuant to
Section 13, 14 or 15(d) of the Exchange Act.
(3) Notwithstanding the foregoing provisions of this Section
2.12, a shareholder shall also comply with all applicable requirements of the
Exchange Act and the rules and regulations thereunder with respect to the
matters set forth in this Section 2.12. Nothing in this section shall be deemed
(a) to affect any rights (i) of shareholders to request inclusion of proposals
in the corporation's proxy statement pursuant to Rule 14a-8 under the Exchange
Act or (ii) of the holders of any series of preferred stock of the corporation
to elect directors under specified circumstances or (b) to grant to any
shareholder any right to nominate persons for election to the Board of
Directors, or to propose business to be considered by the shareholders, that
such shareholder would not have had in the absence of this Section 2.12, it
being the intent of this section only to provide for the procedure for making
such nominations or proposals of business to be considered.
-10-
<PAGE>
ARTICLE 3 - BOARD OF DIRECTORS
------------------------------
SECTION 3.1: GENERAL POWERS
The business and affairs of the corporation shall be managed under the
direction of its Board of Directors.
SECTION 3.2: NUMBER, TENURE, AND QUALIFICATIONS
(a) Subject to the provisions of Paragraph (5) of Section XI of the
Restated Certificate of Incorporation relating to the rights of the holders of
any class or series of Preferred Stock, as defined in Section IV of the
Restated Certificate of Incorporation, to elect under specified circumstances
by separate class vote additional directors, the number of directors of the
corporation shall be fixed from time to time by the affirmative vote of
two-thirds of the total number of directors then in office who have been
elected by the holders of the capital stock of the corporation entitled to vote
generally for the election of directors. No decrease in the number of
directors shall shorten the term of any incumbent director.
(b) Directors need not be residents of Alabama or Delaware nor
shareholders of the corporation.
(c) Any director who has
(i) reached the age of sixty-eight (68) years, or
(ii) retired or otherwise become permanently separated from the
business or professional position that he or she held at the time of his or her
election to the Board of Directors, shall retire from the Board of Directors at
the annual meeting of shareholders of the corporation next following the event
in (i) or (ii) that requires retirement of such director from the Board of
Directors.
-11-
<PAGE>
(d) Any director who has become disabled to the extent that (in the
judgment of a majority of the remaining outside directors) he or she is unable
to perform the duties of a director of the corporation on an ongoing basis
shall be deemed to have retired on the date on which the remaining outside
directors have determined that such director is so disabled. For purposes of
these bylaws a director will not be considered an "outside" director if he or
she is, at the time of determination, an employee of the corporation or any of
its subsidiaries.
(e) Any director who is an officer of the corporation, or of any
subsidiary thereof, shall resign as a director effective on the earliest date on
which he or she is neither an officer of the corporation nor an officer of any
subsidiary thereof.
(f) On recommendation of the Director Affairs Committee, the application
to any individual of any provision of subsection (c)(i) or (ii) or subsection
(e) of this Section 3.2 may be waived by the Board of Directors; provided,
however, that any such waiver shall be effective only on a year-to-year basis.
(g) Any director may resign at any time upon written notice to the
corporation. Any director or the entire Board of Directors may be removed at
any time, but only for cause and only as provided in the Restated Certificate
of Incorporation.
SECTION 3.3: REGULAR MEETINGS
A regular meeting of the Board of Directors shall be held without other
notice than this bylaw at 1:00 p.m., local time, on the third Thursday of
January, March, April, June, July, October, and December (unless such date
shall fall on a holiday observed by AmSouth Bank of Alabama, in which event the
meeting shall be held on the next succeeding business day and at the same hour
or at such other hour as may be designated by the Board of Directors). Regular
meetings of the Board of Directors shall be held at the principal executive
office of the corporation or such other location as may be determined by the
Board of Directors or as permitted by law. The Board of Directors may provide,
by resolution, the time and place, either within or without the State of
Alabama, for the holding of additional or substitute regular meetings without
other notice than such resolution.
-12-
<PAGE>
SECTION 3.4: SPECIAL MEETINGS
Special meetings of the Board of Directors may be called by or at the
request of the Chief Executive Officer or any three (3) directors. A special
meeting of the Board of Directors shall be held at the principal office of the
corporation unless all directors agree in advance and in writing that it be
held at another place, either within or without the State of Alabama.
SECTION 3.5: PARTICIPATION BY CONFERENCE TELEPHONE
Members of the Board of Directors, or of any committee thereof, may
participate in any meeting of the Board of Directors or of any such committee
by means of a conference telephone or similar communications equipment by means
of which all persons participating in the meeting can hear each other; and
participation in a meeting in such manner shall constitute presence in person
at the meeting.
SECTION 3.6: ACTION BY CONSENT WITHOUT A MEETING
Any action required or permitted to be taken at any meeting of the Board
of Directors or of any committee thereof may be taken without a meeting, if a
written consent thereto is signed by all members of the Board of Directors or of
such committee, as the case may be, and such written consent is filed with the
minutes of proceedings of the Board of Directors or committee.
SECTION 3.7: NOTICE
At least one (1) day's notice of any special meeting of the Board of
Directors or of any meeting of a committee of the Board of Directors shall be
given to all directors or committee members, as the case may be, unless, in the
opinion of the officer or directors calling the meeting, an emergency exists
that requires less than one (1) day's notice; in that event, only such notice
need be given as such officer or directors shall direct. Any director may
waive notice of any meeting, as provided in Section 9 of these bylaws. The
attendance of a director at a meeting shall constitute a waiver of notice of
such meeting, except where a director attends a meeting for the express purpose
of objecting at the beginning of the meeting to the transaction of any business
because the meeting is not lawfully called or convened.
-13-
<PAGE>
SECTION 3.8: FEES
By resolution of the Board of Directors, the directors may be paid their
expenses, if any, of attendance at each meeting of the Board of Directors or
any committee thereof and may be paid a fixed sum for attendance at each such
meeting or a stated salary as director, or both.
SECTION 3.9: QUORUM
Except as otherwise provided in Section XI of the Restated Certificate
of Incorporation, a majority of the sum of (i) the number of directors
determined pursuant to Paragraph (2) of Section XI of the Restated Certificate
of Incorporation and Section 3.2(a) of these bylaws, and (ii) the number of
directors, if any, elected under specified circumstances by a separate class
vote of the holders of any class or series of Preferred Stock, as defined in
Section IV of the Restated Certificate of Incorporation, shall constitute a
quorum for the transaction of business at any meeting of the Board of Directors;
but, if less than such quorum is present at a meeting, a majority of the
directors present may adjourn the meeting from time to time without further
notice.
SECTION 3.10: MANNER OF ACTING
Except as provided in Sections VIII and XI of the Restated Certificate
of Incorporation and Section 3.2(a) and Section 3.12 of these bylaws, the act of
the majority of the directors present at a meeting at which a quorum is present
shall be the act of the Board of Directors.
SECTION 3.11: VACANCIES
Any vacancy occurring in the Board of Directors and any directorship to
be filled by reason of an increase in the number of directorships or any other
reason shall be filled according to the provisions of Section XI of the Restated
Certificate of Incorporation.
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<PAGE>
SECTION 3.12: COMMITTEES OF THE BOARD
The Board of Directors may, by resolution or resolutions passed by a
majority of the whole Board, designate one or more committees, which, to the
extent provided in such resolution or resolutions, shall have, and may during
intervals between the meetings of the Board of Directors exercise, all the
powers and authority of the Board of Directors in the management of the
business and affairs of the corporation and may authorize the seal of the
corporation to be affixed to all papers that may require it. Each such
committee or committees shall consist of one or more of the directors of the
corporation and shall have such name or names as may be determined from time to
time by resolution or resolutions adopted by the Board of Directors. The
designation of any such committee or committees and the delegation thereto of
authority shall not operate to relieve the Board of Directors, nor any member
thereof, of any responsibility imposed upon it, him, or her by law.
SECTION 3.13: EMERITUS BOARD OF DIRECTORS
The Board of Directors may designate an "Emeritus Board of Directors",
which shall consist of directors of the corporation who have retired, either by
reason of age or because of being retired or otherwise permanently separated
from the business or professional position that he or she held at the time of
his or her election to the Board of Directors. If the Board of Directors
designates an Emeritus Board of Directors, it will also specify the frequency
of the meetings thereof, eligibility for continued service thereon, and
compensation for service thereon.
ARTICLE 4 - OFFICERS
--------------------
SECTION 4.1: GENERAL
(a) NUMBER. The officers of the corporation shall consist of a
Chairman of the Board of Directors, a President, one or more Vice Presidents
(one or more of whom may be designated by the Board of Directors as Senior
Executive Vice President, Executive Vice President, Senior Vice President, or
such other title as the Board of Directors may determine), a Chief Accounting
Officer, and a Corporate Secretary and may also include such other officers as
the Board of Directors may from time to time determine, including, but not
limited to, one or more Vice Chairmen and one or more Assistant Secretaries.
Either the Chairman of the Board or the President shall be designated by the
Board of Directors as the Chief Executive Officer of the corporation; the
President, a Vice Chairman, or one of the Vice Presidents may be designated by
the Board as the Chief Operating Officer of the corporation; and, other officers
may be designated by other titles such as "Chief Compliance Officer", "Chief
Financial Officer", "Chief Credit Officer", and the like.
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<PAGE>
(b) EXECUTIVE OFFICERS; ORDER OF AUTHORITY. As used in these
bylaws, the term "Executive Officers" shall include the Chairman of the Board
(if, but only if, he or she also is the Chief Executive Officer), the President
(regardless of whether he or she is the Chief Executive Officer), any Vice
Chairman of the Board, the Senior Executive Vice Presidents, and the Executive
Vice Presidents; provided, however, that nothing herein contained is intended to
have any bearing on whether or not an officer of the corporation is an
"executive officer" of the corporation for any purpose other than for convenient
reference in these bylaws, including but not limited to the purpose of
determining whether or not any officer of the corporation is an "officer" within
the meaning of (S) 16 of the Exchange Act or an "executive officer" under
Regulation O of the Federal Reserve Board. Their "order of authority" shall be
the order designated by resolution of the Board of Directors or, if not so
designated by the Board of Directors, as designated by the Chief Executive
Officer.
(c) DUAL OFFICES. Any two or more offices in the corporation may,
except where prohibited by law, be held by the same individual. In cases where
an individual holds more than one office, that person shall have the authority
of all offices so held and shall occupy the "order of authority" provided in
these bylaws for the more or most senior of the offices held.
(d) MANNER OF ELECTION; TERM OF OFFICE. Except as provided below,
all officers shall be elected annually by the Board of Directors at their first
meeting next following the Annual Meeting of Shareholders of the corporation, or
as soon thereafter as is practicable; and their terms of office shall be for one
(1) year, commencing upon election, or until their successors are elected and
qualified, whichever occurs later.
The Board of Directors may, at any time and for any reason sufficient to
them, elect such other officers as they may deem desirable.
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Each of the two (2) Executive Officers having the highest order of
authority shall have the power to elect or appoint, or delegate to any other
officer of the corporation the power to elect or appoint, all employees and all
officers holding a title at or below that of Senior Vice President.
(e) RESIGNATION; REMOVAL FROM OFFICE. Each officer shall hold his
or her office until his or her successor is elected and qualified or until his
or her earlier resignation or removal. Any officer may resign at any time upon
written notice to the corporation. All officers and employees serve at the will
of this corporation and may be removed from office and employment at any time,
with or without cause.
Only the Board of Directors or its Executive Committee may remove from
office the Chief Executive Officer, the Chairman of the Board, or the President.
All other officers and employees may be removed from office by either of
the two (2) Executive Officers having the highest order of authority or by any
person authorized so to do by the personnel policies of the corporation; and,
unless one of the said two (2) Executive Officers acts directly in a particular
instance, removal from office or employment shall be as provided in the
personnel policies of the corporation, as they may from time to time be
adopted, amended, and modified.
(f) VACANCIES. Vacancies in offices above the level of Senior Vice
President becoming vacant may be filled by the Board of Directors or the
Executive Committee. In the event of a vacancy in any of the offices of the
Executive Officers, any of the other Executive Officers remaining may be
elected to fill the vacancy in such office for such period as the Board of
Directors may determine or until further action by the Board.
SECTION 4.2: CHIEF EXECUTIVE OFFICER
Subject to the direction of the Board of Directors, of the Executive
Committee, and of other committees of the Board having authority, the Chief
Executive Officer shall be vested with authority to act for the corporation in
all matters to the extent that such delegation of authority may not be contrary
to law; shall have general charge of the corporation and of its business and
affairs, including authority over the operations of the corporation and over
its employees; and, subject to the limitations stated, shall have full power
and authority to do and perform in the name of the corporation all acts
necessary or proper in his or her opinion to be done and performed and to
execute for and in the name of the corporation all instruments, agreements, and
deeds which may be authorized to be executed on behalf of the corporation or
which may be required by law.
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<PAGE>
SECTION 4.3: CHAIRMAN OF THE BOARD
The Chairman of the Board, or in his or her absence, the President or
other Executive Officers, in their order of authority, shall preside at all
regular, called, or special meetings of the Board of Directors, the Executive
Committee, and the shareholders, and at adjournments thereof.
SECTION 4.4: PRESIDENT
The President shall, subject to the direction of the Board of Directors,
the Executive Committee, other committees of the Board of Directors having
authority (and, if he or she is not the Chief Executive Officer, then also
subject to the direction of the Chief Executive Officer), be vested with
authority to act for the corporation in all matters to the extent that such
delegation of authority may not be contrary to law. The President, regardless
of whether he or she is also the Chief Executive Officer, shall have the same
power to sign for the corporation as is prescribed in these bylaws for the
Chief Executive Officer. The President shall perform all duties incidental to
the office and shall perform such other duties as may be assigned from time to
time by the Board of Directors or the Chief Executive Officer.
SECTION 4.5: OTHER EXECUTIVE OFFICERS
Each of the Executive Officers shall (subject to the direction of the
Board of Directors and of the committees of the Board having authority and to
the direction of the Chief Executive Officer) have and may exercise authority to
act for the corporation in all matters to the extent that such delegation of
authority may not be contrary to law and, in general, to discharge the functions
and to exercise the authority vested in the Chief Executive Officer in matters
not otherwise acted upon by the Chief Executive Officer or by other Executive
Officers senior in the order of authority. Subject to the limitations stated
above, the authority of each Executive Officer shall include authority over the
operations of the corporation within his or her assigned areas of responsibility
and over assigned employees, and authority to do and perform in the name of the
corporation all acts necessary or proper in his or her opinion to be done and
performed and to execute for and in the name of the corporation all instruments,
agreements, and deeds which may be authorized to be executed on behalf of the
corporation or required by law.
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SECTION 4.6: VICE PRESIDENTS
Any Vice President shall have the authority to execute in the name of
the corporation transfers, conveyances, certificates, releases, satisfactions,
authentications, options, proxies, leases, including oil, gas, and other mineral
leases, agreements, including but not limited to agreements relating to
depository accounts of the corporation, or other instruments pertaining to
investment, assets or operations of the corporation or powers held or controlled
by the corporation. The Vice Presidents shall have such other powers as are from
time to time conferred upon them by the Board of Directors, committees of the
Board, and the Executive Officers.
SECTION 4.7: CHIEF ACCOUNTING OFFICER OR CONTROLLER
An officer of the corporation shall be appointed "Chief Accounting
Officer" or "Controller" and shall have custody of the corporation's general
accounting records, shall prepare financial statements, tax returns, profit
plans and reports to regulatory authorities, and shall have such other duties as
the Chief Executive Officer or other Executive Officer may assign him from time
to time.
SECTION 4.8: THE SECRETARY
The Secretary shall: (a) keep the minutes of the shareholders' and of
the Board of Directors' meetings in one (1) or more books provided for that
purpose; (b) see that all notices are duly given in accordance with the
provisions of these bylaws or as required by law; (c) be custodian of the
corporate records and of the seal of the corporation and affix, or cause to be
affixed, the seal of the corporation to all documents the execution of which on
behalf of the corporation under its seal is appropriate; (d) keep a record of
the post office address of each shareholder, which shall be furnished to the
Secretary by such shareholder; (e) have general charge of the stock transfer
books of the corporation; and (f) in general perform all duties incident to the
office of Secretary and such other duties as from time to time may be assigned
to him or her by these bylaws, by the Chief Executive Officer, or by the Board
of Directors. The Secretary may, from time to time, delegate to other officers
of the corporation, including but not limited to Assistant Secretaries, any or
all of the duties and powers of the Secretary hereunder.
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SECTION 4.9: EXERCISE OF AUTHORITY OF CHIEF EXECUTIVE OFFICER BY OTHER
EXECUTIVE OFFICERS
In case of the disqualification, disability, death, resignation, or
removal of the Chief Executive Officer, and until the Board of Directors has
filled the vacancy, the Executive Officers, in their order of authority, shall
act as such Chief Executive Officer and with his full authority.
SECTION 4.10: MANAGEMENT COMMITTEE
There shall be an officers' committee of the corporation (the
"Management Committee"), which shall consist of such officers of the corporation
and its subsidiaries as may be appointed to sit thereon by the Chief Executive
Officer. The chairman of the committee shall be the Chief Executive Officer, and
the committee shall meet at the chairman's call.
The Management Committee shall develop, publish, and implement policies
and procedures for the operation of the corporation and its subsidiaries and
affiliates. The Board of Directors shall have the right to amend or revoke
actions of the Management Committee. The Management Committee may amend, make
additions to, or deletions from, or revoke such policies and procedures, to the
extent the committee deems such actions to be necessary and desirable. In
addition to the duties prescribed above, the Management Committee shall have
such other and further duties and responsibilities as may from time to time be
assigned to it by the Board of Directors or the Chief Executive Officer.
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ARTICLE 5 - SHARES; PROXIES
---------------------------
SECTION 5.1: CERTIFICATES FOR SHARES
Certificates shall be issued only for whole shares and no certificate
will be issued for a fractional share. Certificates representing whole shares of
the corporation shall be in such form as shall be determined by the Board of
Directors and shall be signed in the manner provided by the General Corporation
Law of Delaware by the Chairman or Vice-Chairman of the Board of Directors, or
by the President or any Vice-President, and by the Treasurer or an Assistant
Treasurer, or by the Secretary or an Assistant Secretary. Such signatures may be
in facsimile form. All certificates for shares shall be consecutively numbered
or otherwise identified. The name and address of the person to whom the shares
represented thereby are issued, with the number of shares and date of issue,
shall be entered on the stock transfer books of the corporation. All
certificates surrendered to the corporation for transfer shall be canceled, and
no new certificate shall be issued until the former certificate for a like
number of shares shall have been surrendered and canceled, except that the
corporation may issue a new certificate of stock in place of any certificate
theretofore issued by it, alleged to have been lost, stolen, or destroyed, and
the corporation may require the owner of the lost, stolen, or destroyed
certificate, or such owner's legal representative, to give the corporation a
bond sufficient to indemnify it against any claim that may be made against it on
account of the alleged loss, theft, or destruction of any such certificate or
the issuance of such new certificate, as the Board of Directors may prescribe.
SECTION 5.2: TRANSFER OF SHARES
Transfer of shares of the corporation shall be made only on the stock
transfer books of the corporation by the holder of record thereof or by such
holder's legal representative, who shall furnish proper evidence of authority
to transfer, or by such holder's attorney thereunto authorized by power of
attorney duly executed and filed with the Secretary of the corporation, and on
surrender for cancellation of the certificate for such shares. The person in
whose name shares stand on the books of the corporation shall be deemed by the
corporation to be the owner thereof for all purposes.
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SECTION 5.3: PROXIES
Unless otherwise provided by resolution of the Board of Directors, the
Chief Executive Officer may cast, or from time to time appoint an attorney or
agent of the corporation to cast, the votes that the corporation may be
entitled to cast as the holder of stock or other securities in any other
corporation any of the stock or other securities of which may be held by the
corporation, at meetings of the holders of the stock or other securities of
such other corporation, or to consent in writing, in the name and on behalf of
the corporation as such holder, to any action by such other corporation, and
may instruct the person or persons so appointed as to the manner of casting
such votes or giving such consent, and may execute or cause to be executed, in
the name and on behalf of the corporation and under its corporate seal or
otherwise, all such written proxies or other instruments as the Chief Executive
Officer may deem necessary or proper in the premises.
ARTICLE 6 - FISCAL YEAR
-----------------------
SECTION 6.1: The fiscal year of the corporation shall begin on January 1 and
end on December 31 in each year.
ARTICLE 7 - DIVIDENDS; RECORD DATE
----------------------------------
SECTION 7.1: The Board of Directors or the Executive Committee may from time
to time declare, and the corporation may pay, dividends on its outstanding
shares in the manner and upon the terms and conditions provided by law.
SECTION 7.2: In order that the corporation may determine the shareholders
entitled to receive payment of any dividend or other distribution or allotment
of any rights or the shareholders entitled to exercise any rights with respect
to any change, conversion or exchange of stock, or for the purpose of any other
lawful action, the Board of Directors may fix a record date, which record date
shall not precede the date upon which the resolution fixing the record date is
adopted, and which record date shall be not more than sixty (60) days prior to
such action. If no record date is fixed, the record date for determining
shareholders for any such purpose shall be at the close of business on the day
on which the Board of Directors adopts a resolution relating thereto.
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ARTICLE 8 - SEAL
----------------
SECTION 8.1: The corporate seal of the corporation shall be a circular die
around which shall be the words "AmSouth Bancorporation."
ARTICLE 9 - WAIVERS OF NOTICE
-----------------------------
SECTION 9.1: Whenever any notice is required to be given to any shareholder
or director of the corporation under the provisions of these bylaws, the
Restated Certificate of Incorporation, or the provisions of law, a waiver
thereof in writing, signed by the person or persons entitled to such notice,
whether before or after the time stated therein, shall be deemed equivalent to
the giving of such notice. Neither the business to be transacted at, nor the
purpose of, any regular or special meeting of the shareholders, directors, or
members of a committee of directors need be specified in any written waiver of
notice except as required by the Restated Certificate of Incorporation or these
bylaws.
ARTICLE 10 - AMENDMENTS TO BYLAWS
---------------------------------
SECTION 10.1: POWER OF DIRECTORS TO AMEND
The Board of Directors shall have the power to alter, amend, and repeal
the bylaws of the corporation or adopt new bylaws for the corporation at any
regular or special meeting of the Board.
SECTION 10.2: POWER OF SHAREHOLDERS TO AMEND
(a) The shareholders may alter, amend, or repeal the bylaws of the
corporation or adopt new bylaws for the corporation at any annual meeting or at
a special meeting called for the purpose, and all bylaws made by the directors
may be altered, amended, or repealed by the shareholders; provided, however,
that:
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(1) the affirmative vote of the holders of sixty-seven
percent (67%) of the combined voting power of the then outstanding shares of
capital stock of the corporation entitled to vote generally for the election of
directors, voting together as a single class, shall be required for the
shareholders to alter, amend, or repeal Section VII of the Restated Certificate
of Incorporation of the corporation, or to adopt any provision of these bylaws
that would cause these bylaws to be inconsistent with the provisions of Section
VII of the Restated Certificate of Incorporation of the corporation;
(2) the affirmative vote of the holders of eighty percent
(80%) of the combined voting power of the then outstanding shares of capital
stock of the corporation entitled to vote generally for the election of
directors, voting together as a single class, shall be required for the
shareholders to alter, amend, or repeal Section XI of the Restated Certificate
of Incorporation of the corporation or to adopt any provision of these bylaws
that would cause these bylaws to be inconsistent with the provisions of Section
XI of the Restated Certificate of Incorporation of the corporation;
(3) the affirmative vote of the holders of eighty percent
(80%) of the combined voting power of the then outstanding shares of capital
stock of the corporation entitled to vote generally for the election of
directors, voting together as a single class, shall be required for the
shareholders to alter, amend, or repeal any provision of Paragraph (a) of
Section 3.2 of these bylaws or to adopt any provision of these bylaws that would
cause these bylaws to be inconsistent with the provisions of Paragraph (a) of
Section 3.2 of these bylaws; and
(4) the affirmative vote of the holders of not less than
eighty percent (80%) of the outstanding shares of the voting stock and the
affirmative vote of the holders of not less than sixty-seven percent (67%) of
the voting stock held by shareholders other than an Interested Stockholder (as
defined in Section VIII of the Restated Certificate of Incorporation) shall be
required for the shareholders to alter, amend, or repeal Section VIII of the
Restated Certificate of Incorporation of the corporation, or to adopt any
provision of these bylaws that would cause these bylaws to be inconsistent with
the provisions of Section VIII of the Restated Certificate of Incorporation of
the corporation.
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(b) The affirmative vote of the holders of sixty-seven percent
(67%) of the combined voting power of the then outstanding shares of capital
stock of the corporation entitled to vote generally for the election of
directors, voting together as a single class, shall be required for the
shareholders to alter, amend, or repeal Paragraph (a) (1) of this Section 10.2
of these bylaws or to adopt any provision of these bylaws that would cause these
bylaws to be inconsistent with Paragraph (a) (1) of this Section 10.2 of these
bylaws.
(c) The affirmative vote of the holders of eighty percent (80%) of
the combined voting power of the then outstanding shares of capital stock of the
corporation entitled to vote generally for the election of directors, voting
together as a single class, shall be required for the shareholders to alter,
amend, or repeal Paragraph (a) (2) or (a) (3) of this Section 10.2 of these
bylaws or to adopt any provision of these bylaws inconsistent with Paragraph (a)
(2) or (a) (3) of this Section 10.2 of these bylaws.
(d) The affirmative vote of the holders of not less than eighty
percent (80%) of the outstanding shares of the voting stock and the affirmative
vote of the holders of not less than sixty-seven percent (67%) of the voting
stock held by shareholders other than an Interested Stockholder (as defined in
Section VIII of the Restated Certificate of Incorporation) shall be required for
the shareholders to alter, amend, or repeal Paragraph (a) (4) of this Section
10.2 or to adopt any provision of these bylaws that would cause these bylaws to
be inconsistent with Paragraph (a) (4) of this Section 10.2 of these bylaws.
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EXHIBIT 10-a
AMSOUTH BANCORPORATION
1996 LONG TERM INCENTIVE COMPENSATION PLAN
CONTENTS
<TABLE>
<CAPTION>
PAGE
<S> <C>
Article 1. Establishment, Objectives, and Duration........................ A-2
Article 2. Definitions.................................................... A-2
Article 3. Administration................................................. A-4
Article 4. Shares Subject to the Plan and Maximum Awards.................. A-4
Article 5. Eligibility and Participation.................................. A-5
Article 6. Stock Options.................................................. A-5
Article 7. Stock Appreciation Rights...................................... A-6
Article 8. Restricted Stock............................................... A-6
Article 9. Performance Measures........................................... A-7
Article 10. Beneficiary Designation........................................ A-8
Article 11. Deferrals...................................................... A-8
Article 12. Rights of Employees............................................ A-8
Article 13. Change in Control.............................................. A-8
Article 14. Amendment, Modification, and Termination....................... A-8
Article 15. Withholding.................................................... A-9
Article 16. Indemnification................................................ A-9
Article 17. Successors..................................................... A-9
Article 18. Legal Construction............................................. A-9
</TABLE>
A-1
<PAGE>
ARTICLE 1. ESTABLISHMENT, OBJECTIVES, AND DURATION
1.1. ESTABLISHMENT OF THE PLAN. AmSouth Bancorporation, a Delaware
corporation (hereinafter referred to as the "Company"), hereby establishes an
incentive compensation plan to be known as the "AmSouth Bancorporation 1996
Long Term Incentive Compensation Plan" (hereinafter referred to as the
"Plan"), as set forth in this document. The Plan permits the grant of
Nonqualified Stock Options, Incentive Stock Options, Stock Appreciation
Rights, and Restricted Stock.
Subject to approval by the Company's stockholders, the Plan shall become
effective as of April 18, 1996 (the "Effective Date") and shall remain in
effect as provided in Section 1.3 hereof.
1.2. OBJECTIVES OF THE PLAN. The objectives of the Plan are to optimize the
profitability and growth of the Company through incentives which are
consistent with the Company's objectives and which link the interests of
Participants to those of the Company's stockholders; to provide Participants
with an incentive for excellence in individual performance; and to promote
teamwork among Participants.
The Plan is further intended to provide flexibility to the Company in its
ability to motivate, attract, and retain the services of Participants who make
significant contributions to the Company's success and to allow Participants
to share in the success of the Company.
1.3. DURATION OF THE PLAN. The Plan shall commence on the Effective Date, as
described in Section 1.1 hereof, and shall remain in effect, subject to the
right of the Board of Directors to amend or terminate the Plan at any time
pursuant to Article 14 hereof, until all Shares subject to it shall have been
purchased or acquired according to the Plan's provisions. However, in no event
may an Award be granted under the Plan on or after April 18, 2006.
ARTICLE 2. DEFINITIONS
Whenever used in the Plan, the following terms shall have the meanings set
forth below, and when the meaning is intended, the initial letter of the word
shall be capitalized:
2.1. "AWARD" means, individually or collectively, a grant under this Plan of
Nonqualified Stock Options, Incentive Stock Options, Stock Appreciation
Rights, or Restricted Stock.
2.2. "AWARD AGREEMENT" means an agreement entered into by the Company and
each Participant setting forth the terms and provisions applicable to Awards
granted under this Plan.
2.3. "BENEFICIAL OWNER" or "BENEFICIAL OWNERSHIP" shall have the meaning
ascribed to such term in Rule 13d-3 of the General Rules and Regulations under
the Exchange Act.
2.4. "BOARD" or "BOARD OF DIRECTORS" means the Board of Directors of the
Company.
2.5. "CAUSE" shall be determined by the Committee, in exercise of good faith
and reasonable judgment, and shall mean the occurrence of any one or more of
the following:
(i) The willful and continued failure by the Participant to substantially
perform his duties (other than any such failure resulting from the
Participant's Disability), after a written demand for substantial
performance is delivered by the Committee to the Participant that
specifically identifies the manner in which the Committee believes that
the Participant has not substantially performed his duties, and the
Participant has failed to remedy the situation within thirty (30)
calendar days of receiving such notice; or
(ii) The Participant's conviction for committing an act of fraud,
embezzlement, theft, or another act constituting a felony; or
(iii) The willful engaging by the Participant in gross misconduct materially
and demonstrably injurious to the Company, as determined by the
Committee. However, no act or failure to act, on the Participant's part
shall be considered "willful" unless done, or omitted to be done, by
the Participant not in good faith and without reasonable belief that
his action or omission was in the best interest of the Company.
2.6. "CHANGE IN CONTROL" of the Company shall be deemed to have occurred as
of the first day that any one or more of the following conditions shall have
been satisfied:
(a) Any Person (other than those Persons in control of the Company as of the
Effective Date, or other than a trustee or other fiduciary holding
securities under an employee benefit plan of the Company, or a
corporation owned directly or indirectly by the stockholders of the
Company in substantially the same proportions as their ownership of stock
of the Company) becomes the Beneficial Owner, directly or indirectly, of
securities of the Company representing twenty percent (20%) or more of
the combined voting power of the Company's then outstanding securities;
or
(b) During any period of two (2) consecutive years (not including any period
prior to the Effective Date), individuals who at the beginning of such
period constitute the Board (and any new Director, whose election by the
Company's stockholders was approved by a vote of at least two-thirds
(2/3) of the Directors then still in office who either were Directors at
the beginning of the period or whose election or nomination for election
was so approved), cease for any reason to constitute a majority thereof;
or
(c) The stockholders of the Company approve: (i) a plan of complete
liquidation of the Company; or (ii) an agreement for the sale or
disposition of all or substantially all the Company's assets; or (iii) a
merger, consolidation, or reorganization of the Company with
A-2
<PAGE>
or involving any other corporation, other than a merger, consolidation, or
reorganization that would result in the voting securities of the Company
outstanding immediately prior thereto continuing to represent (either by
remaining outstanding or by being converted into voting securities of the
surviving entity), at least fifty percent (50%) of the combined voting
power of the voting securities of the Company (or such surviving entity)
outstanding immediately after such merger, consolidation, or
reorganization.
However, in no event shall a Change in Control be deemed to have occurred,
with respect to the Participant, if the Participant is part of a purchasing
group which consummates the Change-in-Control transaction. The Participant
shall be deemed "part of a purchasing group" for purposes of the preceding
sentence if the Participant is an equity participant in the purchasing
company or group (except for: (i) passive ownership of less than three
percent (3%) of the stock of the purchasing company; or (ii) ownership of
equity participation in the purchasing company or group which is otherwise
not significant, as determined prior to the Change in Control by a majority
of the nonemployee Directors who were Directors prior to the transaction,
and who continue as Directors following the transaction).
2.7. "CODE" means the Internal Revenue Code of 1986, as amended from time to
time.
2.8. "COMMITTEE" means the Executive Compensation and Benefits Committee of
the Board, as specified in Article 3 herein, or such other Committee appointed
by the Board to administer the Plan with respect to grants of Awards.
2.9. "COMPANY" means AmSouth Bancorporation, and also means any corporation
of which a majority of the voting capital stock is owned directly or
indirectly by AmSouth Bancorporation or by any of its Subsidiaries, and any
other corporation designated by the Committee as being a Company hereunder
(but only during the period of such ownership or designation).
2.10. "COVERED EMPLOYEE" means a Participant who, as of the date of vesting
and/or payout of an Award, as applicable, is one of the group of "covered
employees," as defined in the regulations promulgated under Code Section
162(m), or any successor statute.
2.11. "DIRECTOR" means any individual who is a member of the Board of
Directors of the Company.
2.12. "DISABILITY" as applied to a Participant, means that the Participant
(i) has established to the satisfaction of the Committee that the Participant
is unable to engage in any substantial gainful activity by reason of any
medically determinable physical or mental impairment which can be expected to
last for a continuous period of not less than 12 months (all within the
meaning of Section 22(e) (3) of the Code), and (ii) has satisfied any
requirement imposed by the Committee in regard to evidence of such disability.
2.13. "EFFECTIVE DATE" shall have the meaning ascribed to such term in
Section 1.1 hereof.
2.14. "EMPLOYEE" means any key officer or employee of the Company. Directors
who are not employed by the Company shall not be considered Employees under
this Plan.
2.15. "EXCHANGE ACT" means the Securities Exchange Act of 1934, as amended
from time to time, or any successor act thereto.
2.16. "FAIR MARKET VALUE" shall be determined on the basis of the closing
sale price on the principal securities exchange on which the Shares are traded
or, if there is no such sale on the relevant date, then on the last previous
day on which a sale was reported.
2.17. "FREESTANDING SAR" means an SAR that is granted independently of any
Options, as described in Article 7 herein.
2.18. "INCENTIVE STOCK OPTION" or "ISO" means an option to purchase Shares
granted under Article 6 herein and which is designated as an Incentive Stock
Option and which is intended to meet the requirements of Code Section 422.
2.19. "INSIDER" shall mean an individual who is, on the relevant date, an
officer, director or ten percent (10%) beneficial owner of any class of the
Company's equity securities that is registered pursuant to Section 12 of the
Exchange Act, all as defined under Section 16 of the Exchange Act.
2.20. "NONEMPLOYEE DIRECTOR" means an individual who is a member of the Board
of Directors of the Company but who is not an Employee of the Company.
2.21. "NONQUALIFIED STOCK OPTION" or "NQSO" means an option to purchase
Shares granted under Article 6 herein and which is not intended to meet the
requirements of Code Section 422.
2.22. "OPTION" means an Incentive Stock Option or a Nonqualified Stock
Option, as described in Article 6 herein.
2.23. "OPTION PRICE" means the price at which a Share may be purchased by a
Participant pursuant to an Option.
2.24. "PARTICIPANT" means an Employee who has outstanding an Award granted
under the Plan. The term "Participant" shall not include Nonemployee
Directors.
2.25. "PERFORMANCE-BASED EXCEPTION" means the performance-based exception
from the tax deductibility limitations of Code Section 162(m).
2.26. "PERIOD OF RESTRICTION" means the period during which the transfer of
Shares of Restricted Stock is limited in some way (based on the passage of
time, the achievement of performance objectives, or upon the occurrence of
other events as determined by the Committee, at its discretion), and the
Shares of Restricted Stock are subject to a substantial risk of forfeiture, as
provided in Article 8 herein.
2.27. "PERSON" shall have the meaning ascribed to such
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term in Section 3(a)(9) of the Exchange Act and used in Sections 13(d) and
14(d) thereof, including a "group" as defined in Section 13(d) thereof.
2.28. "RESTRICTED STOCK" means an Award granted to a Participant pursuant to
Article 8 herein.
2.29. "RETIREMENT" as applied to a Participant, means the Participant's
termination of employment in a manner which qualifies the Participant to
receive immediately payable retirement benefits under the AmSouth
Bancorporation Retirement Plan, under the successor or replacement of such
Retirement Plan if it is then no longer in effect, or under any other
retirement plan maintained or adopted by the Company which is determined by
the Committee to be the functional equivalent of such Retirement Plan.
2.30. "SHARES" means common stock of AmSouth Bancorporation, par value $1.00
per share.
2.31. "STOCK APPRECIATION RIGHT" or "SAR" means an Award, granted alone or in
connection with a related Option, designated as an SAR, pursuant to the terms
of Article 7 herein.
2.32. "SUBSIDIARY" means any corporation, partnership, joint venture or other
entity in which the Company has a majority voting interest.
2.33. "TANDEM SAR" means an SAR that is granted in connection with a related
Option pursuant to Article 7 herein, the exercise of which shall require
forfeiture of the right to purchase a Share under the related Option (and when
a Share is purchased under the Option, the Tandem SAR shall similarly be
canceled).
ARTICLE 3. ADMINISTRATION
3.1. THE COMMITTEE. The Plan shall be administered by the Committee of the
Board, or by any other Committee appointed by the Board, which Committee shall
satisfy the "disinterested administration" rules of Rule 16b-3 under the
Exchange Act, or any successor provision. The members of the Committee shall
be appointed from time to time by, and shall serve at the discretion of, the
Board of Directors.
3.2. AUTHORITY OF THE COMMITTEE. Except as limited by law or by the
Certificate of Incorporation or Bylaws of the Company, and subject to the
provisions herein, including Section 3.4, the Committee shall have full power
to select Employees who shall participate in the Plan; determine the sizes and
types of Awards; determine the terms and conditions of Awards in a manner
consistent with the Plan; construe and interpret the Plan and any agreement or
instrument entered into under the Plan as they apply to Employees; establish,
amend, or waive rules and regulations for the Plan's administration as they
apply to Employees; and (subject to the provisions of Article 14 herein) amend
the terms and conditions of any outstanding Award to the extent such terms and
conditions are within the discretion of the Committee as provided in the Plan.
Further, the Committee shall make all other determinations which may be
necessary or advisable for the administration of the Plan, as the Plan applies
to Employees. As permitted by law, the Committee may delegate its authority as
identified herein.
3.3. DECISIONS BINDING. All determinations and decisions made by the
Committee pursuant to the provisions of the Plan and all related orders and
resolutions of the Board shall be final, conclusive and binding on all
persons, including the Company, its stockholders, Employees, Participants, and
their estates and beneficiaries.
3.4. GRANTS TO NON-INSIDERS BY CHIEF EXECUTIVE OFFICER. To the extent
permissible under governing rules and regulations, and, in particular, Section
141(c) of the General Corporation Law of Delaware, the Chief Executive Officer
of the Company shall have the authority to make and administer grants of
Awards under this Plan to non-Insiders upon such terms and conditions as the
Chief Executive Officer shall determine; provided, however, that the total
number of Awards granted by the Chief Executive Officer each year shall be
subject to approval by the Committee.
ARTICLE 4. SHARES SUBJECT TO THE PLAN AND MAXIMUM AWARDS
4.1. NUMBER OF SHARES AVAILABLE FOR GRANTS. Subject to adjustment as provided
in Section 4.3 herein, the number of Shares hereby reserved for issuance to
Participants under the Plan shall be two million, seven hundred fifty thousand
(2,750,000).
Notwithstanding the foregoing, the maximum number of Shares of Restricted
Stock granted pursuant to Article 8 herein shall be an amount equal to thirty
percent (30%) of the total number of Shares reserved for issuance under the
Plan.
Unless and until the Committee determines that an Award to a Covered Employee
shall not be designed to comply with the Performance-Based Exception, the
maximum aggregate number of Shares that may be granted or that may vest, as
applicable, pursuant to any Award granted in any one fiscal year to any single
Covered Employee shall be two hundred fifty thousand (250,000).
4.2. LAPSED AWARDS. If any Award granted under this Plan is canceled,
terminates, expires, or lapses for any reason (with the exception of the
termination of a Tandem SAR upon exercise of the related Option, or the
termination of a related Option upon exercise of the corresponding Tandem
SAR), any Shares subject to such Award again shall be available for the grant
of an Award under the Plan.
4.3. ADJUSTMENTS IN AUTHORIZED SHARES. In the event of any change in
corporate capitalization, such as a stock split, or a corporate transaction,
such as any merger, consolidation, separation, including a spin-off, or other
distribution of stock or property of the Company, any reorganization (whether
or not such reorganization comes within the definition of such term in Code
Section 368) or any partial or complete liquidation of the Company, such
adjustment shall be made in
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the number and class of Shares which may be delivered under Section 4.1, in
the number and class of and/or price of Shares subject to outstanding Awards
granted under the Plan, and in the Award limits set forth in Section 4.1, as
may be determined to be appropriate and equitable by the Committee, in its
sole discretion, to prevent dilution or enlargement of rights; provided,
however, that the number of Shares subject to any Award shall always be a
whole number.
ARTICLE 5. ELIGIBILITY AND PARTICIPATION
5.1. ELIGIBILITY. Persons eligible to participate in this Plan include all
Employees of the Company, including Employees who are members of the Board.
5.2. ACTUAL PARTICIPATION. Subject to the provisions of the Plan, the
Committee may, from time to time, select from all eligible Employees, those to
whom Awards shall be granted and shall determine the nature and amount of each
Award.
ARTICLE 6. STOCK OPTIONS
6.1. GRANT OF OPTIONS. Subject to the terms and provisions of the Plan,
Options may be granted to Participants in such number, and upon such terms,
and at any time and from time to time as shall be determined by the Committee.
6.2. AWARD AGREEMENT. Each Option grant shall be evidenced by an Award
Agreement that shall specify the Option Price, the duration of the Option, the
number of Shares to which the Option pertains, and such other provisions as
the Committee shall determine. The Award Agreement also shall specify whether
the Option is intended to be an ISO within the meaning of Code Section 422, or
an NQSO whose grant is intended not to fall under the provisions of Code
Section 422.
6.3. OPTION PRICE. The Option Price for each grant of an Option under this
Plan shall be at least equal to one hundred percent (100%) of the Fair Market
Value of a Share on the date the Option is granted.
6.4. DURATION OF OPTIONS. Each Option granted to an Employee shall expire at
such time as the Committee shall determine at the time of grant; provided,
however, that no Option shall be exercisable later than the tenth (10th)
anniversary date of its grant.
6.5. DIVIDEND EQUIVALENTS. The Committee may grant dividend equivalents in
connection with Options granted under this Plan. Such dividend equivalents may
be payable in cash or in Shares, upon such terms as the Committee, in its sole
discretion, deems appropriate.
6.6. EXERCISE OF OPTIONS. Options granted under this Article 6 shall be
exercisable at such times and be subject to such restrictions and conditions
as the Committee shall in each instance approve, which need not be the same
for each grant or for each Participant.
6.7. PAYMENT. Options granted under this Article 6 shall be exercised by the
delivery of a written notice of exercise to the Company, setting forth the
number of Shares with respect to which the Option is to be exercised,
accompanied by full payment for the Shares.
The Option Price upon exercise of any Option shall be payable to the Company
in full either: (a) in cash or its equivalent, or (b) if permitted in the
governing Award Agreement, by tendering previously acquired Shares having an
aggregate Fair Market Value at the time of exercise equal to the total Option
Price (provided that the Shares which are tendered must have been held by the
Participant for at least six (6) months prior to their tender to satisfy the
Option Price), or (c) if permitted in the governing Award Agreement, by a
combination of (a) and (b).
The Committee also may allow cashless exercise as permitted under Federal
Reserve Board's Regulation T, subject to applicable securities law
restrictions, or by any other means which the Committee determines to be
consistent with the Plan's purpose and applicable law.
As soon as practicable after receipt of a written notification of exercise
and full payment, the Company shall deliver to the Participant, in the
Participant's name, Share certificates in an appropriate amount based upon the
number of Shares purchased under the Option(s).
6.8. RESTRICTIONS ON SHARE TRANSFERABILITY. The Committee may impose such
restrictions on any Shares acquired pursuant to the exercise of an Option
granted under this Article 6 as it may deem advisable, including, without
limitation, restrictions under applicable federal securities laws, under the
requirements of any stock exchange or market upon which such Shares are then
listed and/or traded, and under any blue sky or state securities laws
applicable to such Shares.
6.9. TERMINATION OF EMPLOYMENT. Each Option, to the extent it has not been
previously exercised, shall terminate upon the earliest to occur of: (i) the
expiration of the Option period set forth in the Option Award Agreement; (ii)
for ISOs, the expiration of three (3) months following the Participant's
Retirement (following the Participant's Retirement, NQSOs shall terminate upon
the expiration of the Option period set forth in the Option Award Agreement);
(iii) the expiration of twelve (12) months following the Participant's death
or Disability; (iv) immediately upon termination for Cause; or (v) the
expiration of thirty (30) days following the Participant's termination of
employment for any reason other than Cause, Change in Control, death,
Disability, or Retirement. Upon a termination of employment related to a
Change in Control, Options shall be treated in the manner set forth in Article
13.
6.10. NONTRANSFERABILITY OF OPTIONS.
(a) INCENTIVE STOCK OPTIONS. No ISO granted under the Plan may be sold,
transferred, pledged, assigned, or otherwise alienated or hypothecated, other
than by will or by the laws of descent and distribution. Further, all ISOs
granted to a Participant under the Plan shall be exercisable during his or her
lifetime only by such Participant.
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(b) NONQUALIFIED STOCK OPTIONS. Except as otherwise provided in a
Participant's Award Agreement, no NQSO granted under this Article 6 may be
sold, transferred, pledged, assigned, or otherwise alienated or hypothecated,
other than by will or by the laws of descent and distribution. Further, except
as otherwise provided in a Participant's Award Agreement, all NQSOs granted to
a Participant under this Article 6 shall be exercisable during his or her
lifetime only by such Participant.
ARTICLE 7. STOCK APPRECIATION RIGHTS
7.1. GRANT OF SARS. Subject to the terms and conditions of the Plan, SARs may
be granted to Participants at any time and from time to time as shall be
determined by the Committee. The Committee may grant Freestanding SARs, Tandem
SARs, or any combination of these forms of SAR.
The Committee shall have complete discretion in determining the number of
SARs granted to each Participant (subject to Article 4 herein) and, consistent
with the provisions of the Plan, in determining the terms and conditions
pertaining to such SARs.
The grant price of a Freestanding SAR shall equal the Fair Market Value of a
Share on the date of grant of the SAR. The grant price of Tandem SARs shall
equal the Option Price of the related Option.
7.2. EXERCISE OF TANDEM SARS. Tandem SARs may be exercised for all or part of
the Shares subject to the related Option upon the surrender of the right to
exercise the equivalent portion of the related Option. A Tandem SAR may be
exercised only with respect to the Shares for which its related Option is then
exercisable.
Notwithstanding any other provision of this Plan to the contrary, with
respect to a Tandem SAR granted in connection with an ISO: (i) the Tandem SAR
will expire no later than the expiration of the underlying ISO; (ii) the value
of the payout with respect to the Tandem SAR may be for no more than one
hundred percent (100%) of the difference between the Option Price of the
underlying ISO and the Fair Market Value of the Shares subject to the
underlying ISO at the time the Tandem SAR is exercised; and (iii) the Tandem
SAR may be exercised only when the Fair Market Value of the Shares subject to
the ISO exceeds the Option Price of the ISO.
7.3. EXERCISE OF FREESTANDING SARS. Freestanding SARs may be exercised upon
whatever terms and conditions the Committee, in its sole discretion, imposes
upon them.
7.4. SAR AGREEMENT. Each SAR grant shall be evidenced by an Award Agreement
that shall specify the grant price, the term of the SAR, and such other
provisions as the Committee shall determine.
7.5. TERM OF SARS. The term of an SAR granted under the Plan shall be
determined by the Committee, in its sole discretion; provided, however, that
such term shall not exceed ten (10) years.
7.6. PAYMENT OF SAR AMOUNT. Upon exercise of an SAR, a Participant shall be
entitled to receive payment from the Company in an amount determined by
multiplying:
(a) The difference between the Fair Market Value of a Share on the date of
exercise over the grant price; by
(b) The number of Shares with respect to which the SAR is exercised.
At the discretion of the Committee, the payment upon SAR exercise may be in
cash, in Shares of equivalent value, or in some combination thereof.
7.7. RULE 16B-3 REQUIREMENTS. Notwithstanding any other provision of the
Plan, the Committee may impose such conditions on exercise of an SAR
(including, without limitation, the right of the Committee to limit the time
of exercise to specified periods) as may be required to satisfy the
requirements of Section 16 of the Exchange Act (or any successor rule).
7.8. TERMINATION OF EMPLOYMENT. Each SAR Award Agreement shall set forth the
extent to which the Participant shall have the right to exercise the SAR
following termination of the Participant's employment with the Company. Such
provisions shall be determined in the sole discretion of the Committee, shall
be included in the Award Agreement entered into with Participants, need not be
uniform among all SARs issued pursuant to the Plan, and may reflect
distinctions based on the reasons for termination of employment.
7.9. NONTRANSFERABILITY OF SARS. Except as otherwise provided in a
Participant's Award Agreement, no SAR granted under the Plan may be sold,
transferred, pledged, assigned, or otherwise alienated or hypothecated, other
than by will or by the laws of descent and distribution. Further, except as
otherwise provided in a Participant's Award Agreement, all SARs granted to a
Participant under the Plan shall be exercisable during his or her lifetime
only by such Participant.
ARTICLE 8. RESTRICTED STOCK
8.1. GRANT OF RESTRICTED STOCK. Subject to the terms and provisions of the
Plan, the Committee, at any time and from time to time, may grant Shares of
Restricted Stock to Participants in such amounts as the Committee shall
determine. Without limiting the generality of the foregoing, Restricted Shares
may be granted in connection with payouts under other compensation programs of
the Company.
8.2. RESTRICTED STOCK AGREEMENT. Each Restricted Stock grant shall be
evidenced by a Restricted Stock Award Agreement that shall specify the
Period(s) of Restriction, the number of Shares of Restricted Stock granted,
and such other provisions as the Committee shall determine.
8.3. TRANSFERABILITY. Except as provided in this Article 8, the Shares of
Restricted Stock granted herein may not be sold, transferred, pledged,
assigned, or otherwise alienated or hypothecated until the end of the
applicable Period of Restriction established by the Committee and specified in
the Restricted Stock Award Agreement, or upon earlier
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satisfaction of any other conditions, as specified by the Committee in its
sole discretion and set forth in the Restricted Stock Award Agreement. All
rights with respect to the Restricted Stock granted to a Participant under the
Plan shall be available during his or her lifetime only to such Participant.
8.4. OTHER RESTRICTIONS. Subject to Article 9 herein, the Committee shall
impose such other conditions and/or restrictions on any Shares of Restricted
Stock granted pursuant to the Plan as it may deem advisable including, without
limitation, a requirement that Participants pay a stipulated purchase price
for each Share of Restricted Stock, restrictions based upon the achievement of
specific performance objectives (Company-wide, business unit, and/or
individual), time-based restrictions on vesting following the attainment of
the performance objectives, and/or restrictions under applicable federal or
state securities laws.
At the discretion of the Committee, the Company may retain the certificates
representing Shares of Restricted Stock in the Company's possession until such
time as all conditions and/or restrictions applicable to such Shares have been
satisfied.
Except as otherwise provided in this Article 8, Shares of Restricted Stock
covered by each Restricted Stock grant made under the Plan shall become freely
transferable by the Participant after the last day of the applicable Period of
Restriction.
8.5. VOTING RIGHTS. During the Period of Restriction, Participants holding
Shares of Restricted Stock granted hereunder may exercise full voting rights
with respect to those Shares.
8.6. DIVIDENDS AND OTHER DISTRIBUTIONS. During the Period of Restriction,
Participants holding Shares of Restricted Stock granted hereunder may be
credited with regular cash dividends paid with respect to the underlying
Shares while they are so held. Such dividends may be paid currently, accrued
as contingent cash obligations, or converted into additional shares of
Restricted Stock, upon such terms as the Committee establishes.
The Committee may apply any restrictions to the dividends that the Committee
deems appropriate. Without limiting the generality of the preceding sentence,
if the grant or vesting of Restricted Shares granted to a Covered Employee is
designed to comply with the requirements of the Performance-Based Exception,
the Committee may apply any restrictions it deems appropriate to the payment
of dividends declared with respect to such Restricted Shares, such that the
dividends and/or the Restricted Shares maintain eligibility for the
Performance-Based Exception.
In the event that any dividend constitutes a "derivative security" or an
"equity security" pursuant to Rule 16(a) under the Exchange Act, such dividend
shall be subject to a vesting period equal to the remaining vesting period of
the Shares of Restricted Stock with respect to which the dividend is paid.
8.7. TERMINATION OF EMPLOYMENT. Upon a Participant's death, Disability, or
Retirement, all Restricted Shares shall vest immediately subject to any
limitations under Code Section 162(m). Each Restricted Stock Award Agreement
shall set forth the extent to which the Participant shall have the right to
retain unvested Restricted Shares following termination of the Participant's
employment with the Company in all other circumstances. Such provisions shall
be determined in the sole discretion of the Committee, shall be included in
the Award Agreement entered into with each Participant, need not be uniform
among all Shares of Restricted Stock issued pursuant to the Plan, and may
reflect distinctions based on the reasons for termination of employment;
provided, however, that, except in the cases of terminations connected with a
Change in Control and terminations by reason of death or Disability, the
vesting of Shares of Restricted Stock which qualify for the Performance-Based
Exception and which are held by Covered Employees shall occur at the time they
otherwise would have, but for the employment termination.
ARTICLE 9. PERFORMANCE MEASURES
Unless and until the Committee proposes for stockholder vote and stockholders
approve a change in the general performance measures set forth in this Article
9, the attainment of which may determine the degree of payout and/or vesting
with respect to Awards to Covered Employees which are designed to qualify for
the Performance-Based Exception, the performance measure(s) to be used for
purposes of such grants shall be chosen from among the following alternatives:
(a) Net Income;
(b) Return on Equity;
(c) Earnings per Share;
(d) Return on Assets;
(e) Total Shareholder Return; and
(f) Return on Investment.
Subject to the terms of the Plan, each of these measures shall be defined by
the Committee on a corporation or subsidiary basis or in comparison with peer
group performance, and may include or exclude specified extraordinary items,
as determined by the Company's auditors.
The Committee shall have the discretion to adjust the determinations of the
degree of attainment of the preestablished performance objectives; provided,
however, that Awards which are designed to qualify for the Performance-Based
Exception, and which are held by Covered Employees, may not be adjusted upward
(the Committee shall retain the discretion to adjust such Awards downward).
In the event that applicable tax and/or securities laws change to permit
Committee discretion to alter the governing performance measures without
obtaining stockholder approval of such changes, the Committee shall have sole
discretion to make such changes without obtaining
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stockholder approval. In addition, in the event that the Committee determines
that it is advisable to grant Awards which shall not qualify for the
Performance-Based Exception, the Committee may make such grants without
satisfying the requirements of Code Section 162(m).
ARTICLE 10. BENEFICIARY DESIGNATION
Each Participant under the Plan may, from time to time, name any beneficiary
or beneficiaries (who may be named contingently or successively) to whom any
benefit under the Plan is to be paid in case of his or her death before he or
she receives any or all of such benefit. Each such designation shall revoke
all prior designations by the same Participant, shall be in a form prescribed
by the Company, and will be effective only when filed by the Participant in
writing with the Company during the Participant's lifetime. In the absence of
any such designation, benefits remaining unpaid at the Participant's death
shall be paid to the Participant's estate.
ARTICLE 11. DEFERRALS
The Committee may permit or require a Participant to defer such Participant's
receipt of the payment of cash or the delivery of Shares that would otherwise
be due to such Participant by virtue of the exercise of an Option or SAR, the
lapse or waiver of restrictions with respect to Restricted Stock, or the
satisfaction of any requirements or objectives with respect to Performance
Units/Shares. If any such deferral election is required or permitted, the
Committee shall, in its sole discretion, establish rules and procedures for
such payment deferrals.
ARTICLE 12. RIGHTS OF EMPLOYEES
12.1. EMPLOYMENT. Nothing in the Plan shall interfere with or limit in any
way the right of the Company to terminate any Participant's employment at any
time, nor confer upon any Participant any right to continue in the employ of
the Company.
12.2. PARTICIPATION. No Employee shall have the right to be selected to
receive an Award under this Plan, or, having been so selected, to be selected
to receive a future Award.
ARTICLE 13. CHANGE IN CONTROL
13.1. TREATMENT OF OUTSTANDING AWARDS. Upon the occurrence of a Change in
Control, unless otherwise specifically prohibited under applicable laws, or by
the rules and regulations of any governing governmental agencies or national
securities exchanges:
(a) Any and all Options and SARs granted hereunder shall become immediately
exercisable, and shall remain exercisable throughout their entire term;
and
(b) Any restriction periods and restrictions imposed on Shares of Restricted
Stock shall lapse; provided, however, that the degree of vesting
associated with Restricted Stock which has been conditioned upon the
achievement of performance conditions pursuant to Section 8.4 herein
shall be determined in the manner set forth in Section 8.7 herein.
13.2. TERMINATION, AMENDMENT, AND MODIFICATIONS OF CHANGE-IN-CONTROL
PROVISIONS. Notwithstanding any other provision of this Plan or any Award
Agreement provision, the provisions of this Article 13 may not be terminated,
amended, or modified on or after the date of a Change in Control to affect
adversely any Award theretofore granted under the Plan without the prior
written consent of the Participant with respect to said Participant's
outstanding Awards.
ARTICLE 14. AMENDMENT, MODIFICATION, AND TERMINATION
14.1. AMENDMENT, MODIFICATION, AND TERMINATION. Subject to Section 13.2
herein, the Board may at any time and from time to time, alter, amend, suspend
or terminate the Plan in whole or in part; provided, however, that no
amendment which requires stockholder approval in order for the Plan to
continue to comply with Rule 16b-3 under the Exchange Act, including any
successor to such Rule, shall be effective unless such amendment shall be
approved by the requisite vote of stockholders of the Company entitled to vote
thereon.
The Committee shall not have the authority to cancel outstanding Awards and
issue substitute Awards in replacement thereof.
14.2. ADJUSTMENT OF AWARDS UPON THE OCCURRENCE OF CERTAIN UNUSUAL OR
NONRECURRING EVENTS. The Committee may make adjustments in the terms and
conditions of, and the criteria included in, Awards in recognition of unusual
or nonrecurring events (including, without limitation, the events described in
Section 4.3 hereof) affecting the Company or the financial statements of the
Company or of changes in applicable laws, regulations, or accounting
principles, whenever the Committee determines that such adjustments are
appropriate in order to prevent dilution or enlargement of the benefits or
potential benefits intended to be made available under the Plan; provided,
however, that Awards which are designed to qualify for the Performance-Based
Exception, and which are held by Covered Employees, may only be adjusted to
the extent permissible under Code Section 162(m).
14.3. AWARDS PREVIOUSLY GRANTED. No termination, amendment, or modification
of the Plan shall adversely affect in any material way any Award previously
granted under the Plan, without the written consent of the Participant holding
such Award.
14.4. COMPLIANCE WITH CODE SECTION 162(M). At all times when Code Section
162(m) is applicable, all Awards granted under this Plan shall comply with the
requirements of Code Section 162(m); provided, however, that in the event the
Committee determines that such compliance is not
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desired with respect to any Award or Awards available for grant under the
Plan, then compliance with Code Section 162(m) will not be required. In
addition, in the event that changes are made to Code Section 162(m) to permit
greater flexibility with respect to any Award or Awards available under the
Plan, the Committee may, subject to this Article 14, make any adjustments it
deems appropriate.
ARTICLE 15. WITHHOLDING
15.1. TAX WITHHOLDING. The Company shall have the power and the right to
deduct or withhold, or require a Participant to remit to the Company, an
amount sufficient to satisfy federal, state, and local taxes, domestic or
foreign, required by law or regulation to be withheld with respect to any
taxable event arising as a result of this Plan.
15.2. SHARE WITHHOLDING. With respect to withholding required upon the
exercise of Options or SARs, upon the lapse of restrictions on Restricted
Stock, or upon any other taxable event arising as a result of Awards granted
hereunder, Participants may elect to satisfy the withholding requirement, in
whole or in part, by having the Company withhold Shares having a Fair Market
Value on the date the tax is to be determined equal to the minimum statutory
total tax which could be withheld on the transaction. All such elections shall
be made in writing, signed by the Participant, and shall be subject to any
restrictions or limitations that the Committee, in its sole discretion, deems
appropriate.
ARTICLE 16. INDEMNIFICATION
Each person who is or shall have been a member of the Committee, or of the
Board, shall be indemnified and held harmless by the Company against and from
any loss, cost, liability, or expense that may be imposed upon or reasonably
incurred by him or her in connection with or resulting from any claim, action,
suit, or proceeding to which he or she may be a party or in which he or she
may be involved by reason of any action taken or failure to act under the Plan
and against and from any and all amounts paid by him or her in settlement
thereof, with the Company's approval, or paid by him or her in satisfaction of
any judgement in any such action, suit, or proceeding against him or her,
provided he or she shall give the Company an opportunity, at its own expense,
to handle and defend the same before he or she undertakes to handle and defend
it on his or her own behalf. The foregoing right of indemnification shall not
be exclusive of any other rights of indemnification to which such persons may
be entitled under the Company's Certificate of Incorporation or Bylaws, as a
matter of law, or otherwise, or any power that the Company may have to
indemnify them or hold them harmless.
ARTICLE 17. SUCCESSORS
All obligations of the Company under the Plan with respect to Awards granted
hereunder shall be binding on any successor to the Company, whether the
existence of such successor is the result of a direct or indirect purchase, of
all or substantially all of the business and/or assets of the Company, or a
merger, consolidation, or otherwise.
ARTICLE 18. LEGAL CONSTRUCTION
18.1. GENDER AND NUMBER. Except where otherwise indicated by the context, any
masculine term used herein also shall include the feminine; the plural shall
include the singular and the singular shall include the plural.
18.2. SEVERABILITY. In the event any provision of the Plan shall be held
illegal or invalid for any reason, the illegality or invalidity shall not
affect the remaining parts of the Plan, and the Plan shall be construed and
enforced as if the illegal or invalid provision had not been included.
18.3. REQUIREMENTS OF LAW. The granting of Awards and the issuance of Shares
under the Plan shall be subject to all applicable laws, rules, and
regulations, and to such approvals by any governmental agencies or national
securities exchanges as may be required.
18.4. SECURITIES LAW COMPLIANCE. With respect to Insiders, transactions under
this Plan are intended to comply with all applicable conditions of Rule 16b-3
or its successors under the Exchange Act. To the extent any provision of the
Plan or action by the Committee fails to so comply, it shall be deemed null
and void, to the extent permitted by law and deemed advisable by the
Committee.
18.5. GOVERNING LAW. To the extent not preempted by federal law, the Plan,
and all agreements hereunder, shall be construed in accordance with and
governed by the laws of the state of Alabama.
A-9
<PAGE>
Exhibit 10-b
AMSOUTH BANCORPORATION AMENDMENT
TO EMPLOYMENT AGREEMENT
THIS AMENDMENT to the Employment Agreement dated June 15, 1995 (the
"Employment Agreement") by and between AmSouth Bancorporation, a Delaware
Corporation (hereinafter referred to as the "Company"), and C. Dowd Ritter
(hereinafter referred to as the "Executive") is effective as of the 21st day of
March, 1996. Unless otherwise defined, all capitalized terms herein shall have
the meaning ascribed to them in the Employment Agreement.
W I T N E S S E T H:
WHEREAS, the Executive is presently employed by the Company in the
capacity of President and Chief Executive Officer pursuant to the Employment
Agreement;
WHEREAS, the Executive and the Company do not believe the Employment
Agreement clearly reflects their agreement with respect to the excise tax
gross-up;
WHEREAS, the Company and the Executive believe it necessary to clarify
certain provisions of the Employment Agreement related to the excise tax
gross-up; and
WHEREAS, the Company and the Executive desire to enter into this
amendment to provide for such changes to the Employment Agreement.
NOW THEREFORE, to assure the Company that it will have the continued
dedication of the Executive and the availability of his advice and counsel, and
to induce the Executive to remain in the employ of the Company, and for other
good and valuable consideration, the Company and the Executive agree to amend
the Employment Agreement as follows:
Section 8.1 is hereby deleted and replaced with the following text:
8.1 EQUALIZATION PAYMENT. In the event that the Executive
becomes entitled to severance benefits under Section 6.4 or 6.6 herein
("Severance Benefits"), if any of the Executive's "Total Payments", as defined
herein, will be subject to the tax (the "Excise Tax") imposed by Section 4999 of
the Internal Revenue Code of 1986, as amended (the "Code") (or any similar tax
that may hereafter be imposed), the Company shall pay to the Executive in cash
an additional amount (the "Gross-Up Payment") such that the net amount retained
by the Executive after deduction of (i) any Excise Tax on the Total Payments and
(ii) any federal, state, and local income tax and Excise Tax upon the Gross-Up
Payment provided for by this Section 8.1, shall be equal to the Total Payments.
Such payment shall be made by the Company to Executive as soon as practicable
following the Effective Date of Termination, but in no event beyond thirty (30)
days from such date.
<PAGE>
As used in this Article 8, "Total Payments" means the sum of the Executive's
Severance Benefits and all other payments and benefits provided to the
Executive by the Company which constitute "excess parachute payments" within
the meaning of Code Section 280G(b)(1). Without limiting the generality of the
foregoing, Total Payments shall include any and all excess parachute payments
associated with outstanding long-term incentive grants.
Section 8.2 TAX COMPUTATION. is hereby amended to replace all references
to "Severance Benefits" with the term "Total Payments".
IN WITNESS WHEREOF, the parties have executed this Amendment to the
Employment Agreement on this _______ day of ___________________, 1996.
AMSOUTH BANCORPORATION EXECUTIVE:
By:
------------------------------- --------------------------------
Its Executive Vice President C. DOWD RITTER
and Human Resources Director
Attest:
--------------------------
Its Secretary
<PAGE>
Exhibit 10-c
AMSOUTH BANCORPORATION
AMENDMENT TO EXECUTIVE SEVERANCE AGREEMENT
THIS AMENDMENT to the Executive Severance Agreement dated [DAY], (the
"ESA") by and between AmSouth Bancorporation, a Delaware Corporation
(hereinafter referred to as the "Company"), and [EXNAME] (hereinafter referred
to as the "Executive") is made and entered into as of the 21ST DAY OF MARCH,
1996. Unless otherwise defined, all capitalized terms herein shall have the
meanings ascribed to them in the ESA.
W I T N E S S E T H:
WHEREAS, should the possibility of a Change in Control of the Company
arise, the Board believes it imperative that the Company and the Board should be
able to rely upon the Executive to continue in [gender] position, and that
the Company should be able to receive and rely upon the executive's advice, if
requested, as to the best interests of the Company and its shareholders without
concern that the Executive might be distracted by the personal uncertainties
and risks created by the possibility of a Change in Control;
WHEREAS, should the possibility of a Change in Control arise, in
addition to [gender] regular duties, the Executive may be called upon to
assist in the assessment of such possible Change in Control, advise management
and the Board as to whether such Change in Control would be in the best
interests of the Company and its shareholders, and to take such other actions as
the Board might determine to be appropriate;
WHEREAS, to assure the Company that it will have the continued
dedication of the Executive and the availability of [gender] advice and
counsel notwithstanding the possibility, threat, or occurrence of a Change in
Control of the Company and to induce the Executive to remain the employ of
the Company, the Company and the Executive entered into the ESA;
WHEREAS, the Company and the Executive believe it necessary to clarify
certain provisions of the ESA and to extend the time period within which
protection is provided to the Executive for a Change in Control; and
WHEREAS, the Company and the Executive desire to enter into this
amendment to provide for such changes to the ESA.
NOW THEREFORE, to assure the Company that it will have the continued
dedication of the Executive and the availability of [gender] advice and
counsel notwithstanding the possibility, threat, or occurrence of a Change in
Control of the Company, and to induce the Executive to remain in the employ of
the Company, and for other good and valuable consideration, the Company and the
Executive agree to amend the ESA as follows:
Paragraphs (u) and (v) are hereby added to the end of the section
entitled ARTICLE 1. DEFINITIONS:
(u) "Total Payments" means the sum of the Executive's Severance
Benefits and all other payments and benefits provided to the
Executive by the Company which constitute "excess parachute
payments" within the meaning of Code Section 280G(b)(1). Without
limiting the generality of the foregoing, Total Payments shall
include any and all excess parachute payments associated with
outstanding long-term incentive grants (to include, but not be
limited to, early vesting of stock options or restricted stock).
(v) "Window Period" means the time period commencing upon a Change
in Control, as defined in Section (g) of this Article 1, and
ending twenty-four months after the latter to occur of: (i) any
of the events defined as a Change in Control in Section 1(g); or
(ii) final consummation of the liquidation, sale or disposition
of assets, or the merger, consolidation or reorganization of the
Company as described in Section 1(g)(iii).
1
<PAGE>
The first paragraph of Section 2.1 is hereby deleted and replaced with
the following text:
2.1 RIGHT TO SEVERANCE BENEFITS. The Executive shall be entitled
to receive from the Company Severance Benefits as described in Section
2.4 herein, if there has been a Change in Control of the Company and if,
within the Window Period, the Executive's employment with the Company
shall end for any reason specified in Section 2.3 herein.
The first clause of Section 2.3 is hereby deleted and replaced with the
following text:
2.3 QUALIFYING TERMINATION. The occurrence of any one or more of
the following events within the Window Period shall trigger the payment
of Severance Benefits to the Executive under this Agreement:
The second sentence of item (f) of SECTION 2.4. DESCRIPTION OF SEVERANCE
BENEFITS is hereby deleted and replaced with the following sentence:
For this purpose, the Executive's interest under the
Supplemental Retirement plan shall be fully vested as of the effective
date of the Change in Control and such benefits shall be calculated
under the assumption that the Executive's employment continued following
the Effective Date of Termination for the number of years equal to the
Severance Multiplier (i.e., additional years of service credits shall be
added); provided, however, that for purposes of determining "final
average pay" under the benefit calculation, the Executive's actual pay
history as of the Effective Date of Termination shall be used.
Section 4.1 is hereby deleted and replaced with the following text:
4.1 EQUALIZATION PAYMENT. In the event that the Executive
becomes entitled to Severance Benefits, if any of the Executive's Total
Payments will be subject to the tax (the "Excise Tax") imposed by
Section 4999 of the Code (or any similar tax that may hereafter be
imposed), the Company shall pay to the Executive in cash an additional
amount (the "Gross-up Payment") such that the net amount retained by the
Executive after deduction of any Excise Tax on the Total Payments and
any federal, state, and local income tax and Excise Tax upon the Gross-
up Payment provided for by this Section 4.1, shall be equal to the Total
Payments. Such payment shall be made by the Company to the Executive as
soon as practicable following the Effective Date of Termination, but in
no event beyond thirty (30) days from such date.
Section 4.2 TAX COMPUTATION. is hereby amended to replace all references
to "Severance Benefits" with the term "Total Payments".
Section (i) of the second paragraph of ARTICLE 6. TERM OF AGREEMENT is
hereby deleted and replaced with the following text:
(i) the duration of the Window Period;
IN WITNESS WHEREOF, the parties have executed this Amendment to the ESA
on this _______ day of ___________________, 1996.
AMSOUTH BANCORPORATION EXECUTIVE
BY:
------------------------------------------ -------------------------------
ITS PRESIDENT AND CHIEF EXECUTIVE OFFICER [EXNAME]
ATTEST:
---------------------------
ITS SECRETARY
2
<PAGE>
EXHIBIT 11
AMSOUTH BANCORPORATION
STATEMENT REGARDING COMPUTATION OF EARNINGS PER COMMON SHARE
<TABLE>
<CAPTION>
THREE MONTHS
ENDED MARCH 31
---------------
1996 1995
------- -------
(IN THOUSANDS
EXCEPT
PER SHARE DATA)
<S> <C> <C>
Net income..................................................... $47,163 $40,110
======= =======
Average shares of common stock outstanding..................... 57,021 58,103
======= =======
Earnings per common share...................................... $ 0.83 $ 0.69
======= =======
</TABLE>
<PAGE>
Exhibit 15--Letter Re: Unaudited Interim Financial Information
Board of Directors
AmSouth Bancorporation
We are aware of the incorporation by reference in the following Registration
Statements and in their related Prospectuses, of our report dated May 9, 1996,
relating to the unaudited consolidated financial statements of AmSouth
Bancorporation and subsidiaries which are included in its Form 10-Q for the
quarter ended March 31, 1996;
Form S-3 No. 33-55683 pertaining to the Dividend Reinvestment and Common
Stock Purchase Plan;
Form S-8 No. 33-52243 pertaining to the assumption by AmSouth Bancorporation
of FloridaBank Stock Option Plan and FloridaBank Stock Option Plan--
1993;
Form S-8 No. 33-52113 pertaining to the 1989 Long Term Incentive
Compensation Plan;
Form S-3 No. 33-50363 pertaining to the Debt Shelf Registration;
Form S-8 No. 33-35218 pertaining to the 1989 Long Term Incentive
Compensation Plan;
Form S-8 No. 33-37905 pertaining to the AmSouth Bancorporation Thrift Plan;
Form S-8 No. 33-9368 pertaining to the Long Term Incentive Compensationm
Plan;
Form S-8 No. 33-2927 (as amended) pertaining to the Employee Stock Purchase
Plan;
Form S-8 No. 2-97464 pertaining to the Long Term Incentive Compensation
Plan;
Form S-3 No. 33-35280 pertaining to the Dividend Reinvestment and Common
Stock Purchase Plan;
Form S-8 No. 33-19016 pertaining to the Long Term Incentive Compensation
Plan;
Form S-8 No. 33-18653 pertaining to the 1987 Substitute Stock Option Plan;
Form S-8 No. 33-58777 pertaining to the Director Restricted Stock Plan; and,
Form S-8 No. 333-02099 pertaining to the AmSouth Bancorporation Thrift Plan.
Pursuant to Rule 436(c) of the Securities Act of 1933 our reports are not
part of the registration statements prepared or certified by accountants
within the meaning of Sections 7 or 11 of the Securities Act of 1933.
/s/ ERNST & YOUNG LLP
May 9, 1996
<TABLE> <S> <C>
<PAGE>
<ARTICLE> 9
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE
CONSOLIDATED STATEMENT OF CONDITION, THE CONSOLIDATED STATEMENT OF EARNINGS, AND
TABLES 2, 6, AND 7 OF ITEM 2 OF THE AMSOUTH BANCORPORATION FORM 10-Q FOR THE
QUARTERLY PERIOD ENDED MARCH 31, 1996 AND IS QUALIFIED IN ITS ENTIRETY BY
REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-1996
<PERIOD-START> JAN-01-1996
<PERIOD-END> MAR-31-1996
<CASH> 587,278
<INT-BEARING-DEPOSITS> 0
<FED-FUNDS-SOLD> 1,600
<TRADING-ASSETS> 3,510
<INVESTMENTS-HELD-FOR-SALE> 2,534,791
<INVESTMENTS-CARRYING> 2,574,911
<INVESTMENTS-MARKET> 2,565,870
<LOANS> 11,546,007
<ALLOWANCE> 177,930
<TOTAL-ASSETS> 17,914,386
<DEPOSITS> 13,252,486
<SHORT-TERM> 2,423,993
<LIABILITIES-OTHER> 207,857
<LONG-TERM> 660,496
0
0
<COMMON> 60,030
<OTHER-SE> 1,309,524
<TOTAL-LIABILITIES-AND-EQUITY> 17,914,386
<INTEREST-LOAN> 250,870
<INTEREST-INVEST> 78,734
<INTEREST-OTHER> 1,760
<INTEREST-TOTAL> 331,364
<INTEREST-DEPOSIT> 132,986
<INTEREST-EXPENSE> 173,659
<INTEREST-INCOME-NET> 157,705
<LOAN-LOSSES> 15,120
<SECURITIES-GAINS> 0
<EXPENSE-OTHER> 122,848
<INCOME-PRETAX> 74,832
<INCOME-PRE-EXTRAORDINARY> 74,832
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 47,163
<EPS-PRIMARY> 0.83
<EPS-DILUTED> 0.83
<YIELD-ACTUAL> 3.91
<LOANS-NON> 90,919
<LOANS-PAST> 40,110
<LOANS-TROUBLED> 0
<LOANS-PROBLEM> 0
<ALLOWANCE-OPEN> 178,451
<CHARGE-OFFS> 20,626
<RECOVERIES> 4,985
<ALLOWANCE-CLOSE> 177,930
<ALLOWANCE-DOMESTIC> 0
<ALLOWANCE-FOREIGN> 0
<ALLOWANCE-UNALLOCATED> 0
</TABLE>
