<PAGE> 1
SCHEDULE 14A INFORMATION
PROXY STATEMENT PURSUANT TO SECTION 14(A) OF THE SECURITIES
EXCHANGE ACT OF 1934 (AMENDMENT NO. )
Filed by the Registrant /X/
Filed by a Party other than the Registrant / /
Check the appropriate box:
/X/ Preliminary Proxy Statement
/ / Definitive Proxy Statement
/ / Definitive Additional Materials
/ / Soliciting Material Pursuant to sec.240.14a-11(c) or sec.240.14a-12
First Alabama Bancshares, Inc.
- --------------------------------------------------------------------------------
(Name of Registrant as Specified in Charter)
- --------------------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement)
Payment of Filing Fee (Check the appropriate box):
/X/ $125 per Exchange Act Rules 0-11(c)(1)(ii), or 14a-6(i)(1), or 14a-6(j)(2).
/ / $500 per each party to the controversy pursuant to Exchange Act Rule
14a-6(i)(3).
/ / Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and 0-11.
(1) Title of each class of securities to which transaction applies:
(2) Aggregate number of securities to which transaction applies:
(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11:
(4) Proposed maximum aggregate value of transaction:
Set forth the amount on which the filing fee is calculated and state how it
was determined.
/ / Check box if any part of the fee is offset as provided by Exchange Act Rule
0-11(a)(2) and identify the filing for which the offsetting fee was paid
previously. Identify the previous filing by registration statement number,
or the Form or Schedule and the date of its filing.
(1) Amount Previously Paid:
(2) Form, Schedule or Registration Statement No.:
(3) Filing Party:
(4) Date Filed:
<PAGE> 2
FIRST FIRST ALABAMA
ALABAMA BANCSHARES, INC.
Post Office Box 10247
Birmingham, Alabama 35202-0247
Telephone 205 326-7100
TO THE STOCKHOLDERS:
You are cordially invited to attend the twenty-third annual meeting of
the stockholders of First Alabama Bancshares, Inc. to be held at 9:30 a.m., on
Wednesday, April 27, 1994, in the Auditorium of First Alabama Bank, located at
8 Commerce Street, Montgomery, Alabama.
We hope you will plan to attend the stockholders' meeting. However, in
order that we may be assured of a quorum, we urge you to sign and return the
enclosed proxy in the postage-paid envelope provided as promptly as possible,
whether or not you plan to attend the meeting in person. If you do attend the
meeting, you may withdraw your proxy.
A reception and coffee will be held from 9:00 a.m. until 9:30 a.m., in
the Auditorium of First Alabama Bank. We hope you will find it convenient to
come early enough to enjoy this social time prior to the stockholders' meeting.
/s/ J. Stanley Mackin
---------------------
J. Stanley Mackin
Chairman of the Board
and Chief Executive Officer
March 16, 1994
<PAGE> 3
FIRST FIRST ALABAMA
ALABAMA BANCSHARES, INC.
Post Office Box 10247
Birmingham, Alabama 35202-0247
Telephone 205 326-7100
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
To be held
April 27, 1994
NOTICE IS HEREBY GIVEN that the annual meeting of stockholders of First
Alabama Bancshares, Inc. (First Alabama or Company), a Delaware corporation,
will be held in the Auditorium of First Alabama Bank, 8 Commerce Street,
Montgomery, Alabama on Wednesday, April 27, 1994, at 9:30 a.m. Montgomery time,
for the purpose of considering and acting on the following:
1. To elect the five (5) nominees named in the Proxy Statement as
directors to serve for three year terms or until their successors
have been elected and qualified.
2. To consider and act upon a proposal to amend Item First of the
Certificate of Incorporation to change the name of the corporation
from First Alabama Bancshares, Inc. to Regions Financial Corporation;
3. To consider and act upon a proposal to amend Item Fourth of the
Certificate of Incorporation to provide for an increase in the number
of authorized shares of common stock to 120,000,000; and
4. The transaction of such other business as may properly come before
the meeting or any adjournment thereof.
Only stockholders of record at the close of business on March 9, 1994,
are entitled to receive notice of and to vote at the meeting. A complete list
of the stockholders entitled to vote at the meeting, arranged in alphabetical
order and showing the address of each stockholder and the number of shares
registered in the name of each stockholder shall be open to examination by any
stockholder, for any purpose germane to the meeting, during ordinary business
hours, for a period of at least 10 days prior to the meeting at the main office
of First Alabama Bank, 417 North 20th Street, Birmingham, Alabama. Stockholders
are invited to attend the meeting in person.
PLEASE SIGN AND DATE THE ACCOMPANYING PROXY AND RETURN IT PROMPTLY IN
THE ENCLOSED POSTAGE-PAID ENVELOPE WHETHER OR NOT YOU PLAN TO ATTEND THE
MEETING IN PERSON. THE PROXY MAY BE REVOKED AT ANY TIME PRIOR TO ITS EXERCISE.
By Order of the Board of Directors
L. Burton Barnes, III
Corporate Secretary
March 16, 1994
<PAGE> 4
FIRST FIRST ALABAMA
ALABAMA BANCSHARES, INC.
Post Office Box 35202-0247
Telephone 205 326-7100
PROXY STATEMENT
FOR 1994 ANNUAL MEETING OF STOCKHOLDERS
This Proxy Statement is furnished to the stockholders of First Alabama
Bancshares, Inc. (First Alabama or Company) in connection with the 1994 annual
meeting of stockholders to be held on Wednesday, April 27, 1994, at 9:30 a.m. in
the Auditorium of First Alabama Bank, 8 Commerce Street, Montgomery, Alabama
and at any adjournment thereof. The matters to be considered and acted upon are
(1) the election of five nominees as directors of the corporation, (2) the
proposal to change the name of the corporation, (3) the proposal to increase
the number of authorized shares of common stock to 120,000,000, and (4) such
other business as may properly come before the meeting.
The enclosed proxy is solicited on behalf of the board of directors of
First Alabama and is revocable by the stockholder at any time prior to the
voting of such proxy. All properly executed proxies delivered pursuant to this
solicitation will be voted at the meeting and in accordance with instructions,
if any.
This is the first mailing of proxy solicitation materials to
stockholders. In addition to solicitation by mail, proxies may be solicited by
directors, officers and other employees of First Alabama who will receive no
compensation in addition to their regular compensation. First Alabama has also
engaged Georgeson & Company, Inc. to assist in the distribution of proxy
materials and inquiries and to solicit proxies from brokers, nominees and
security-holding companies for a fee of $9,000 plus expenses. The cost of
preparing, assembling and mailing this proxy statement and other materials
furnished to stockholders and other expenses of solicitation, including the
expenses of brokers, custodians, nominees and other fiduciaries, who at the
request of First Alabama, mail material to or otherwise communicate with
beneficial owners of the shares held by them, will be paid by First Alabama.
Participants in First Alabama's Dividend Reinvestment Service will note
that shares held by First Alabama Bank, administrator for that plan, are shown
on the enclosed proxy card in addition to shares held directly by the
stockholder in certificate form. Signing and returning the proxy card will
enable voting of all shares, including those held in the Dividend Reinvestment
Service.
The annual report of First Alabama Bancshares, Inc. for the year 1993,
including financial statements, has been mailed to all stockholders. Such
report and financial statements are not a part of this proxy statement except
as specifically incorporated herein.
First Alabama Bancshares, Inc.'s primary bank subsidiary is First
Alabama Bank, which operates from 166 full-service banking offices throughout
Alabama. First Alabama Bancshares, Inc.'s Tennessee bank subsidiaries, First
Security Bank of Tennessee and Franklin County Bank, operate from 24
full-service banking offices in middle Tennessee. First Alabama Bancshares,
Inc.'s Florida bank subsidiary, Regions Bank of Florida, operates from 23
full-service banking offices in northwest Florida. First Alabama Bancshares,
Inc.'s Georgia bank subsidiary, First Alabama Bank of Columbus, operates from 3
full-service banking offices in Columbus, Georgia. First Alabama Bancshares,
Inc.'s savings bank subsidiary, Secor Bank, operates from 19 full-service
offices primarily in Louisiana.
Operating bank-related subsidiaries owned by First Alabama Bancshares,
Inc. or a subsidiary bank are as follows: Real Estate Financing, Inc., First
Alabama Investments, Inc., Regions Financial Leasing, Inc., Regions Agency,
Inc., Regions Title Company, FAB Agency, Inc., Regions Life Insurance Company,
and Regions Financial Building Corporation.
The date of this proxy statement is March 16, 1994.
<PAGE> 5
VOTING SECURITIES AND PRINCIPAL HOLDERS THEREOF
As of March 9, 1994 First Alabama had issued 42,520,025 shares of
common stock, of which 1,470,700 shares are held as treasury stock and are
non-voting. Stockholders are entitled to one vote for each share on all matters
to come before the meeting. Only stockholders of record at the close of
business on March 9, 1994, will be entitled to vote at the meeting or any
adjournment thereof.
Security Ownership of Certain Beneficial Owners
As of December 31, 1993, all First Alabama affiliate banks
beneficially held in a fiduciary capacity for others under numerous trust
relationships 2,392,366 shares or 5.8% of First Alabama's outstanding common
stock. First Alabama's affiliate bank trust departments have sole voting
power with respect to 2,071,163 of these shares or 5.05%, shared voting power
with respect to 25,174 of these shares, sole dispositive power with respect to
1,097,287 of these shares and shared dispositive power with respect to 982,147
of these shares. No other entity is known to the Company to be the beneficial
owner of more than five percent of any class of voting securities.
Security Ownership of Directors and Management
No director or nominee for director is deemed to own beneficially 1%
or more of First Alabama's common stock as of March 9, 1994. All directors and
executive officers of First Alabama, as a group, own beneficially a total of
1,588,725 shares (which includes 358,216 shares that are the subject of
presently exercisable options) or 3.84% of the Company's outstanding common
stock. Information with respect to beneficial ownership is based upon
information furnished by each officer, director or nominee, or contained in
filings made with the Securities and Exchange Commission.
The following table presents information concerning the beneficial
ownership of First Alabama's common stock by certain of its executive officers
at March 9, 1994. For beneficial ownership information of each director, see
"Election of Directors."
<TABLE>
<CAPTION>
First Alabama Stock Beneficially Owned
--------------------------------------
Name and Address Title of Class # of Shares (1) % of Class
- -------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
J. Stanley Mackin Common 218,685 0.53%
Birmingham
Richard D. Horsley Common 155,642 0.38
Birmingham
Carl E. Jones, Jr. Common 162,110 0.39
Mobile
Joe M. Hinds, Jr. Common 135,132 0.33
Huntsville
Sam P. Faucett Common 143,150 0.35
Tuscaloosa
</TABLE>
_______________________
(1) The amounts shown represents the total shares beneficially owned by
such individuals together with shares which are issuable upon the
exercise of all stock option which are currently exercisable and
exercisable within 60 days. Specifically, the following individuals
have the right to acquire the shares indicated after their names, upon
the exercise of such stock options: Mr. Mackin, 89,795, Mr. Horsley,
64,350, Mr. Jones, 28,825, Mr. Hinds, 52,375 and Mr. Faucett, 42,475.
No change in control of First Alabama has occurred since January 1,
1993, and no arrangements are known to First Alabama which may at a later date
result in a change in control of the Company.
2
<PAGE> 6
ELECTION OF DIRECTORS
First Alabama recommends that the board of directors for the ensuing
year shall consist of twelve directors, and further recommends the election of
James B. Boone, Jr., Albert P. Brewer, James S.M. French, Richard D. Horsley
and J. Stanley Mackin, as directors, to hold office for a term of three years
expiring with the annual meeting of stockholders to be held in 1997 or until
their successors are elected and qualified. The terms of office of seven
directors continue after the meeting. The proxy will be voted for the
nominees, unless otherwise directed. If any nominee is not available for
election, the proxies will be voted for such substitute nominee as the board of
directors may designate. First Alabama has no reason to believe that any
substitute nominee or nominees will be required. The proxies will not be voted
for more than five nominees.
In the election of directors, the five individuals receiving the
largest number of votes will be elected. Accordingly, abstentions and broker
non-votes on behalf of holders of outstanding shares will affect the results of
the election solely to the extent they affect the vote totals of persons for
whom such shares may otherwise have voted.
Information on Directors
The following table indicates the age, residence, principal occupation
or employment for the last five years of each nominee or director whose term of
office continues after the meeting, position and offices held with First
Alabama or its subsidiaries, the year the director was first elected, and the
number of shares of common stock of the Company beneficially owned at March 9,
1994.
<TABLE>
<CAPTION>
Number of Shares
of Stock Beneficially
Owned at
Present March 9, 1994
Occupation and Year -----------------------------------
Principal Position and Term of Percentage
Name of Nominee Occupation for Offices held with Office of
or Director Last Five First Alabama Director Will (2) Outstanding
and Residence Age Years & Subsidiaries Since Expire Directly Indirectly Shares
- ---------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Shelia S. Blair 59 Executive Director, First 1989 1996 46,610 8,524 0.134%
Birmingham Director, Alabama Bank
Greater
Birmingham
Foundation
(Community
Foundation)
James B. Boone, Jr. (1) 58 Chairman of Director, First 1985 1997 13,352 0 0.033
Tuscaloosa the Alabama Bank;
Board, Boone Director, First
Newspapers, Alabama Bank--
Inc. Tuscaloosa(3)
(Newspaper
Publishing,
Management and
Ownership)
Albert P. Brewer (1) 65 Professor of Director, First 1986 1997 52,057 22,272 0.181
Decatur Law Alabama
and Bank; Director,
Government, First
Sanford Alabama Bank--
University Decatur/Hartselle(3)
James S.M. French (1) 54 Chairman and Director, First 1986 1997 6,720 56,848 0.155
Birmingham President, Alabama
Dunn Bank; Director,
Investment Co. First
(Construction, Alabama Bank--
Construction Birmingham(3)
Materials,
Investments)
</TABLE>
__________________________
(1) Nominee for election at 1994 stockholders' meeting.
(2) Indirect beneficial ownership includes shares, if any, (a) owned as
trustee in which the director or any member of his/her immediate
family has a beneficial interest, or (b) held in a trust in which the
director has a beneficial interest, or (c) owned and traded in the
name of the spouse, minor children or other relative of the director
living in his home, or (d) owned by a corporation, partnership or
other legal organization in which the director has a substantial
beneficial interest.
(3) As a consequence of the merger of all of First Alabama's subsidiary
banks in Alabama into one bank (First Alabama Bank) and the resulting
cessation of their separate corporate existence, First Alabama has
established bodies of local advisory directors corresponding to the
former boards of directors of the subsidiary banks. Service on such a
body is denoted in the tables, for example, "Director, First Alabama
Bank--Birmingham."
3
<PAGE> 7
<TABLE>
<CAPTION>
Number of Shares
of Stock Beneficially
Owned at
March 9, 1994
Present Year --------------------------------
Occupation Position and Term of Percentage
Name of Nominee and Principal Offices held with Office of
or Director Occupation for First Alabama Director Will (2) Outstanding
and Residence Age Last Five Years & Subsidiaries Since Expire Directly Indirectly Shares
-----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Richard D. Horsley (1) 51 Vice Chairman of Director, First 1982 1997 155,642(4) 0 0.379%
Birmingham the Board and Alabama Bank;
Executive Director, Secor
Financial Officer, Bank, FSB;
First Alabama and Director,
First Alabama Bank FAB Agency, Inc.,
Regions Life
Insurance Company,
Regions Financial
Building Corp.
and Real Estate
Financing Inc.;
Director and Vice
President, Regions
Agency, Inc.
Catesby ap C. Jones 68 Proprietor, Mabry Director, 1971 1996 26,850 500 0.067
Selma Securities First Alabama Bank;
(Insurance Agency) Director, First
Alabama
Bank -- Montgomery
(3)
Olin B. King 60 Chairman and CEO, Director, First 1984 1996 7,303 0 0.018
Huntsville SCI Systems, Inc. Alabama Bank;
(Diversified Director, First
Electronics Alabama Bank --
Manufacturer) Huntsville (3)
J. Stanley Mackin (1) 61 Chairman and Director, First 1990 1997 218,685(4) 16,562 0.532
Birmingham Chief Executive Alabama Bank;
Officer, First Director, Secor
Alabama and First Bank, FSB;
Alabama Bank; Director,
Formerly President Real Estate
and Chief Operating Financing, Inc.,
Officer, First FAB Agency, Inc.,
Alabama and First Regions Life
Alabama Bank; Insurance
Formerly President Company and
of Central Region Regions
and Chairman Agency, Inc.
& CEO, First
Alabama Bank --
Birmingham
</TABLE>
_______________________
(1) Nominee for election at 1994 stockholders' meeting.
(2) Indirect beneficial ownership includes shares, if any, (a) owned as
trustee in which the director or any member of his/her immediate
family has a beneficial interest, or (b) held in a trust in which the
director has a beneficial interest, or (c) owned and traded in the
name of the spouse, minor children or other relative of the director
living in his home, or (d) owned by a corporation, partnership or
other legal organization in which the director has a substantial
beneficial interest.
(3) As a consequence of the merger of all of First Alabama's subsidiary
banks in Alabama into one bank (First Alabama Bank) and the resulting
cessation of their separate corporate existence, First Alabama has
established bodies of local advisory directors corresponding to the
former boards of directors of the subsidiary banks. Service on such a
body is denoted in the tables as, for example, "Director, First
Alabama Bank -- Birmingham."
(4) Includes 64,350 shares for Mr. Horsley and 89,795 shares for Mr.
Mackin that are the subject of presently exercisable options.
4
<PAGE> 8
<TABLE>
<CAPTION>
Number of Shares
of Stock Beneficially
Owned at
March 9, 1994
Present Year ---------------------------------
Occupation Position and Term of Percentage
Name of Nominee and Principal Offices held with Office of
or Director Occupation for First Alabama Director Will (2) Outstanding
and Residence Age Last Five Years & Subsidiaries Since Expire Directly Indirectly Shares
---------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
H. Manning McPhillips, 71 Chairman and CEO, Director, 1982 1995 16,314 1,513 0.043%
Jr. McPhillips First Alabama
Mobile Manufacturing Bank: Director,
Company, Inc. First Alabama
(Manufacturer of Bank--Mobile
Stock Millwork) (3); Director
Real Estate
Financing, Inc.
Henry E. Simpson 59 Attorney, Lange, Director and 1973(5) 1995 70,787 25,322 0.234
Birmingham Simpson, Robinson & Assistant Secretary,
Somerville First Alabama
Bank; Director,
First Alabama
Bank--Birmingham (3)
Robert E. Steiner, III 69 Attorney, Steiner, Assistant Secretary, 1971 1995 54,793 0 0.133
Montgomery Crum & Baker First Alabama;
Director and
Assistant Secretary,
First Alabama
Bank; Director,
First Alabama
Bank--Montgomery (3);
Director,
Regions Agency, Inc.
Lee J. Styslinger, Jr. 61 Chairman, ALTEC Director, First 1985 1996 53,693 0 0.131
Birmingham Industries, Inc. Alabama Bank;
(Manufacturer of Director, First
Mobile Alabama Bank--
Utility Equipment) Birmingham (3)
</TABLE>
_________________________________
(2) Indirect beneficial ownership includes shares, if any, (a) owned as
trustee in which the director or any member of his/her immediate
family has a beneficial interest, or (b) held in a trust in which the
director has a beneficial interest, or (c) owned and traded in the
name of the spouse, minor children or the relative of the director
living in his home, or (d) owned by a corporation, partnership or
other legal organization in which the director has a substantial
beneficial interest.
(3) As a consequence of the merger of all of First Alabama's subsidiary
banks in Alabama into one bank (First Alabama Bank) and the resulting
cessation of their separate corporate existence, First Alabama has
established bodies of local advisory directors corresponding to the
former boards of directors of the subsidiary banks. Service on such a
body is denoted in the tables as, for example, "Director, First
Alabama Bank -- Birmingham."
(5) Mr. Simpson did not serve as a director from April 1979 to April 1980.
5
<PAGE> 9
Of the directors or nominees for director, none is a "control person"
of the Company by virtue of stock ownership. The only persons who might be
considered as "control persons" of the Company are J. Stanley Mackin, Chairman
and Chief Executive Officer, and Richard D. Horsley, Vice Chairman and
Executive Financial Officer, who gain any control they may exercise by virtue
of office.
Of the nominees and directors listed above, four also serve as
directors of other companies with a class of securities registered under the
Securities Exchange Act of 1934. James S. M. French serves as a director of
Energen Corporation, as a director of Complete Health, Inc. and as a director
of Hilb, Rogal and Hamilton Company; Olin B. King serves as a director of SCI
Systems, Inc.; H. Manning McPhillips, Jr. serves as a director of Morrison
Incorporated; and Lee J. Styslinger, Jr. serves as a director of Complete
Health, Inc. and as a director of The Mead Corporation.
The Board and Committees of the Board
First Alabama held seven directors' meetings during 1993. All directors
attended at least 75% of the aggregate of the meetings held by the board and
by its committees of which they were members. Among other board committees,
First Alabama has an audit committee and a personnel committee that meet as
needed. The Company has no nominating or similar committee.
Audit Committee. The members of the audit committee are Albert P.
Brewer (Chairman), Sheila S. Blair, Richard D. Horsley (ex officio member),
Catesby ap C. Jones, J. Stanley Mackin (ex officio member) and Norman F.
McGowin, Jr. At the conclusion of the stockholders meeting on April 27, 1994,
Norman F. McGowin, Jr. will retire from the audit committee and the Company s
board of directors. The principal functions of the audit committee, which held
four meetings during 1993, include selection of independent auditors, approval
of proposed independent audit fees, reviewing with the independent auditors the
planning for and results of the audit, approving professional services provided
by the independent auditors, establishing goals and plans for the nature and
extent of internal audit work, determining the effectiveness and adequacy of
accounting and internal controls and the adequacy of the audit staff, and
reviewing major internal audit findings. The corporate loan review staff
submits periodic loan examination reports to the audit committee for their
review.
Personnel Committee. The personnel committee, which held five meetings
during 1993, consists of H. Manning McPhillips, Jr. (Chairman), James B.
Boone, Jr., Albert P. Brewer, W.L. Halsey, Jr., Catesby ap C. Jones, J. Stanley
Mackin (ex officio member) and Lee J. Styslinger, Jr. At the conclusion of the
stockholders meeting on April 28, 1993, W.L. Halsey retired from the personnel
committee and the Company's board of directors. Albert P. Brewer, whose service
on the Company's board of directors commenced in 1986, joined the personnel
committee at its August 31, 1993 meeting.
The role of the personnel committee is to establish and monitor
corporate policy and practice in the broad area of human resources management.
The personnel committee exercises strategic and administrative responsibility
in working with Company management on the development and clarification of the
Company's compensation philosophy, articulating reasons behind design of the
Company's pay and benefits programs and their relationship to corporate
objectives and competitive practices.
The functions of the personnel committee are recommending to the board
the compensation arrangements for executive management, approving compensation
arrangements for senior company officers, making recommendations to the board
concerning compensation plans in which officers are eligible to participate and
recommending to the board the establishment of or changes in benefit plans in
which officers are eligible to participate, and recommending to the board the
establishment of or changes in benefit plans in which officers and employees
participate (including the authority to make amendments to tax-qualified plans
in which officers participate). The personnel committee also reviews employee
claims against the Company, reviews the community involvement of senior
management personnel, reviews proposed legislation affecting human resource
management, approves certain new or amended personnel policies or statutory
benefits plans, and acts on other important personnel matters. All actions
taken with respect to compensation programs are reported to the board through
detailed personnel committee minutes.
The personnel committee specifically serves as the board compensation
committee in keeping with rules presently in effect under the Securities and
Exchange Commission. In discharging this responsibility, the committee has,
from time to time, used the services of compensation consultants for guidance
with respect to competitive data and practices of other banks.
Section 16 Transactions
Section 16(a) of the Securities Exchange Act of 1934 requires First
Alabama's executive officers and directors to file reports of ownership and
changes in ownership of First Alabama stock with the Securities and Exchange
Commission. Executive officers and directors are required by SEC regulations to
furnish First Alabama with copies of all Section 16(a) forms they file.
Based on a review of the forms filed during 1993, First Alabama
believes that all filing requirements applicable to its executive officers and
directors were complied with.
6
<PAGE> 10
EXECUTIVE COMPENSATION AND OTHER TRANSACTIONS
The following table is a summary of certain information concerning the
compensation earned by First Alabama's chief executive officer and each of the
other four most highly compensated executive officers during the last three
fiscal years.
Summary Compensation Table
<TABLE>
<CAPTION>
Long Term Compensation
-------------------------------------
Annual Compensation Awards Payouts
---------------------------------------------------------------------------
Other Annual Restricted Stock LTIP (2) All Other
Name & Principal Position Year Salary Bonus Compensation Stock (1) Options Payouts Compensation
-----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
J. Stanley Mackin 1993 $525,000 $314,213 $0 $0 32,000 $546,175 $593,521 (3)
Chairman & Chief 1992 $450,000 $315,000 $0 $723,438 29,700 $390,570 $30,000
Executive Officer 1991 $300,000 $210,000 $0 $600,000 37,400 $0 $30,000
Richard D. Horsley 1993 $228,000 $136,458 $0 $0 13,000 $243,511 $159,455 (4)
Vice Chairman & 1992 $222,500 $155,750 $0 $289,375 11,550 $174,135 $30,000
Executive Financial 1991 $222,500 $155,750 $0 $198,750 17,600 $0 $25,079
Officer
Carl E. Jones, Jr. 1993 $205,000 $120,157 $0 $0 13,000 $243,511 $117,737 (5)
Regional President 1992 $195,000 $126,713 $0 $289,375 11,550 $174,135 $26,422
1991 $185,000 $122,624 $0 $198,750 14,080 $0 $20,852
Joe M. Hinds, Jr. 1993 $198,000 $118,029 $0 $0 13,000 $243,511 $193,635 (6)
Regional President 1992 $189,000 $129,164 $0 $289,375 11,550 $174,135 $26,426
1991 $180,000 $120,367 $0 $198,750 14,080 $0 $20,944
Sam P. Faucett 1993 $198,000 $117,555 $0 $0 13,000 $243,511 $162,960 (7)
Regional President 1992 $189,000 $132,141 $0 $289,375 11,550 $174,135 $28,350
1991 $180,000 $126,000 $0 $198,750 14,080 $0 $23,915
</TABLE>
__________________________
(1) The terms of the Restricted Stock awards are determined by the
personnel committee. Under the terms of the currently outstanding
Restricted Stock awards, the named executives must remain employed
with First Alabama for five years from the date of the grant at the
same or higher level in order for the shares to be released. During
the five year period, the named executive is eligible to receive
dividends and exercise voting privileges on such restricted shares.
If any of the restrictions are removed at the discretion of the
personnel committee, the named executive officer will receive a stock
certificate for some percentage or all of the awarded restricted
shares. The restricted shares are not transferable by the named
executive during the restriction period. The personnel committee has
the discretion to modify the terms of the Restricted Stock awards.
Mr. Mackin had 31,350 shares of Restricted Stock with a fair market
value of $1,011,000 at December 31, 1993. The personnel committee
released 18,810 shares to Mr. Mackin during 1993. Messers. Horsley,
Jones, Hinds and Faucett each had 11,330 shares of Restricted Stock
with a fair market value of $365,400 at December 31, 1993. The
personnel committee released 6,798 shares to each of these executive
officers during 1993.
(2) During 1993, at the personnel committee's discretion, a portion of the
performance shares awarded in 1991 and 1992 were declared earned as a
result of specific performance objectives being exceeded or satisfied.
(3) Includes $3,109 allocated to Mr. Mackin in 1993 under the Employee
Stock Ownership Plan; $26,891 allocated to Mr. Mackin in 1993 under
the profit sharing plan; $64,868 representing the estimated term
component of the premium paid by First Alabama in 1993 on a life
insurance policy covering Mr. Mackin; and $498,653 representing the
balance of the 1993 premium on such policy less the estimated present
value of the recovery of such premium by First Alabama, which will
occur upon the earliest of Mr. Mackin's retirement, death or
termination of employment.
(4) Includes $3,006 allocated to Mr. Horsley in 1993 under the Employee
Stock Ownership Plan; $26,994 allocated to Mr. Horsley in 1993 under
the profit sharing plan; $18,658 representing the estimated term
component of the premium paid by First Alabama in 1993 on a life
insurance policy covering Mr. Horsley; and $110,797 representing the
balance of the 1993 premium on such policy less the estimated present
value of the recovery of such premium by First Alabama, which will
occur upon the earliest of Mr. Horsley's retirement, death or
termination of employment.
(5) Includes $2,703 allocated to Mr. Jones in 1993 under the Employee
Stock Ownership Plan; $27,297 allocated to Mr. Jones in 1993 under the
profit sharing plan; $16,575 representing the estimated term
component of the premium paid by First Alabama in 1993 on a life
insurance policy covering Mr. Jones; and $71,162 representing the
balance of the 1993 premium on such policy less the estimated present
value of the recovery of such premium by First Alabama, which will
occur upon the earliest of Mr. Jones' retirement, death or
termination of employment.
(6) Includes $2,611 allocated to Mr. Hinds in 1993 under the Employee
Stock Ownership Plan; $27,090 allocated to Mr. Hinds in 1993 under the
profit sharing plan; $26,519 representing the estimated term component
of the premium paid by First Alabama in 1993 on a life insurance
policy covering Mr. Hinds; and $137,415 representing the balance of
the 1993 premium on such policy less the estimated present value of
the recovery of such premium by First Alabama, which will occur upon
the earliest of Mr. Hinds' retirement, death or termination of
employment.
(7) Includes $2,611 allocated to Mr. Faucett in 1993 under the Employee
Stock Ownership Plan; $27,090 allocated to Mr. Faucett in 1993 under
the profit sharing plan; $21,688 representing the estimated term
component of the premium paid by First Alabama in 1993 on a life
insurance policy covering Mr. Faucett; and $111,571 representing the
balance of the 1993 premium on such policy less the estimated present
value of the recovery of such premium by First Alabama, which will
occur upon the earliest of Mr. Faucett's retirement, death or
termination of employment.
7
<PAGE> 11
Stock Options
The following table presents information concerning individual grants of
options to purchase First Alabama common stock made during 1993 to the named
executive officers.
<TABLE>
<CAPTION>
Option Grants in the Last Fiscal Year
-------------------------------------------------------------------------------------
Number of % of Total Exercise
Securities Underlying Options Granted Prior Grant Date
Name Options Granted To Employees in 1993 (Per Share) Expiration Date Present Value (1)
----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
J. Stanley Mackin 32,000 11% $32.3125 August 30, 2003 $186,240
Richard D. Horsley 13,000 4% $32.3125 August 30, 2003 $ 75,660
Carl E. Jones, Jr. 13,000 4% $32.3125 August 30, 2003 $ 75,660
Sam P. Faucett 13,000 4% $32.3125 August 30, 2003 $ 75,660
Joe M. Hinds, Jr. 13,000 4% $32.3125 August 30, 2003 $ 75,660
</TABLE>
________________________
(1) Based on the Black-Scholes option pricing model adapted for use in
valuing executive stock options. The actual value, if any, an
executive may realize depends on the excess of the stock price over
the exercise price on the date the option is exercised, so there is no
assurance the value realized by an executive will be at or near the
value estimated by the Black-Scholes model. The estimated values
under that model are based on the assumptions of expected stock price
volatility of 0.06, risk-free rate of return of 5.5%, dividend yield
of 3% and time to exercise of ten years.
The following table presents information concerning exercises of
stock options to purchase First Alabama common stock during 1993 and the
number and value of unexercised options and stock appreciation rights (SAR)
held by the named executive officers.
<TABLE>
<CAPTION>
Aggregated Option/SAR Excerises in 1993
-------------------------------------------------------------------------------------------------------------
Number of
Securities Underlying Unexercised Value of Unexercised In-the-Money
--------------------------------------------------------------------------------
Options at 12-31-93 SARS at 12-31-93 Options at 12-31-93 SARS at 12-31-93
Shares --------------------------------------------------------------------------------
Acquired Value Exercisable/ Exercisable/ Exercisable/ Exercisable/
Name on Exercised Realized Unexercisable Unexercisable Unexercisable Unexercisable
---- ----------- -------- ------------- ------------- ------------- -------------
<S> <C> <C> <C> <C> <C> <C>
J. Stanley Mackin 13,500 $218,369.00 89,795/32,000 35,043/0 $972,444/$0 $568,263/$0
Richard D. Horsley 3,300 $ 69,937.50 64,350/13,000 28,049/0 $764,132/$0 $484,751/$0
Carl E. Jones, Jr. 5,000 $ 95,392.05 28,825/13,000 10,235/0 $388,332/$0 $170,443/$0
Joe M. Hinds, Jr. 4,000 $ 84,136.36 52,375/13,000 21,162/0 $792,207/$0 $359,949/$0
Sam P. Faucett 9,500 $168,676.14 42,475/13,000 17,462/0 $713,207/$0 $297,572/$0
</TABLE>
Long-term Incentive Plan Awards in 1993
The following table presents information concerning the long-term
incentives awarded to First Alabama's named executive officers.
<TABLE>
<CAPTION>
Estimated Future Payouts Under
Performance or Non-Stock Price-Based Plans (1)
Number of Other Period -----------------------------------------------------
Shares, Units or Until Maturation Threshold Target Maximum
Name Other Rights (1) Or Payout (2) # # #
-------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
J. Stanley Mackin 19,000 5 Years 9,500 19,000 19,000
Richard D. Horsley 8,500 5 Years 4,250 8,500 8,500
Carl E. Jones, Jr. 8,500 5 Years 4,250 8,500 8,500
Joe M. Hinds, Jr. 8,500 5 Years 4,250 8,500 8,500
Sam P. Faucett 8,500 5 Years 4,250 8,500 8,500
</TABLE>
____________________
(1) Each share or right represents performance share awards under the
Company's long-term incentive plan which are equal in value to the
market price of one share of First Alabama common stock at the
maturation date with a maximum value of $50.00 per share.
(2) The performance objectives may relate to the specific performance of
the named executive, or the performance of the Company, region,
subsidiary, unit bank, department or function within which the named
executive is employed. The performance objectives established for the
current awards relate to the achievement of specific levels of return
on equity. If at the end of the performance period the performance
objectives have been satisfied, the named executive will have earned
the award, or, at the discretion of the personnel committee, some
percentage or fraction thereof, if the specified performance
objectives are exceeded or satisfied in part. The performance period
generally will be not less than one year or more than five years. The
personnel committee has the discretion to modify the terms of the
Long-term Incentive Plan awards.
8
<PAGE> 12
Retirement Plans
The named executive officers are covered by the Employee's Retirement
Plan of First Alabama, a qualified defined benefit retirement plan, as
complimented by retirement compensation agreements pursuant to its supplemental
executive retirement program.
The following table shows estimated annual benefits payable at
retirement, including both qualified plan benefits and supplemental benefits,
based on combinations of final compensation and age at retirement.
<TABLE>
<CAPTION>
Pension Plan Table
------------------------------------------------------------------------------------------------------
Age At Retirement
------------------------------------------------------------------------------------------------------
Compensation 55 60 62 63 64 65
------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
$175,000 $70,000 $87,500 $94,500 $98,000 $101,500 $105,000
200,000 $80,000 $100,000 $108,000 $112,000 $116,000 $120,000
225,000 $90,000 $112,500 $121,500 $126,000 $130,500 $135,000
250,000 $100,000 $125,000 $135,000 $140,000 $145,000 $150,000
300,000 $120,000 $150,000 $162,000 $168,000 $174,000 $180,000
350,000 $140,000 $175,000 $189,000 $196,000 $203,000 $210,000
400,000 $160,000 $200,000 $216,000 $224,000 $232,000 $240,000
450,000 $180,000 $225,000 $243,000 $252,000 $261,000 $270,000
500,000 $200,000 $250,000 $270,000 $280,000 $290,000 $300,000
550,000 $220,000 $275,000 $297,000 $308,000 $319,000 $330,000
600,000 $240,000 $300,000 $324,000 $336,000 $348,000 $360,000
650,000 $260,000 $325,000 $351,000 $364,000 $377,000 $390,000
</TABLE>
In 1993, compensation covered by the plans for the five highest paid
executive officers was as follows: Mr. Mackin, $525,000, Mr. Horsley $228,000,
Mr. Jones $208,000, Mr. Hinds $198,000, and Mr. Faucett $198,000.
Benefits are based on average compensation (limited to base salary)
over the three years prior to retirement, and are payable as a single life
annuity for single participants and a joint and 50% survivor annuity for
married participants. Other forms of payment are available on an actuarially
equivalent basis. Amounts shown are subject to offset for Company-sponsored
long-term disability payments.
Benefits will be reduced or eliminated if the participant terminates
employment voluntarily before age 55.
Employment Agreements
First Alabama has no employment agreements with any of the named
executive officers. During December 1993, each of the named executive officers
entered into agreements terminating their employment agreements with First
Alabama and canceling the five-year prospective term of employment that would
otherwise have existed under those employment agreements had either party given
notice of its intent to cancel the agreement.
Directors' Compensation
Directors of First Alabama are paid a quarterly director's fee of
$1,500, or a total of $6,000 annually. In addition, directors are paid a fee
of $1,000 for each board meeting attended. Directors who are chairman of board
committees receive $750 and other directors who are members of board committees
receive $600 for each board committee meeting attended. Directors who are
employees of the parent company receive no fees for parent company board
membership or attendance at parent company board or board committee meetings.
In January 1984, the board of directors adopted the Directors' Stock
Investment Plan, a plan designed to provide added incentive to the non-employee
directors of the Company and its subsidiaries and local divisions. As amended
in 1991, the plan provides that each participant may contribute to the plan all
or part of the fees payable by the Company. The Company will contribute 25% of
the amount contributed by each director. Both director and Company
contributions will be applied to the purchase of First Alabama common stock for
the account of the director. Directors are immediately vested in all amounts
held in the plan on their behalf.
9
<PAGE> 13
Compensation and Stock Option Determinations
The determination of executive compensation and the award of stock
options is regularly delegated to the personnel committee of the board of
directors. Discrete board committees or subcommittees for the independent
determinations of compensation and stock awards do not exist. The Company's
directors believe that executive compensation decisions must consider aggregate
(total) compensation, since executive compensation in the financial services
industry typically consists of a variety of elements, tied to an assortment of
long-term and short-term performance objectives, such as return on equity and
return on assets. The personnel committee consists of five outside directors,
including the committee chairman, and the Company's chairman and chief
executive officer who serves only in a non-voting ex officio capacity. The
formal report of the personnel committee concerning 1993 compensation is as
follows:
Personnel Committee Compensaton Report. Under the direct control
of the personnel committee of the board of directors, the Company has developed
and installed compensation policies, plans, and procedures that seek to enhance
the profitability of the Company. Shareholder value is aligned with the
financial interests of the Company's senior managers as financial goals are set
for each year. Annual base salaries are generally set at competitive levels
with similar financial institutions operating in southeastern markets.
Specifically, the committee considers peer group comparisons from survey data
for southeastern financial companies, recommendations from an independent
compensation consultant and individual performance assessment. For executives
other than the chief executive officer, the committee also considers the chief
executive officer's recommendation. While these factors are fully considered
and discussed by the committee, the committee members are not required to
express or record the weight they assign to any particular factor. In each
instance the committee members reached a consensus and the committee set a base
salary level for each executive. The Company relies on annual and long-term
incentive compensation plans to attract and retain corporate officers and other
key employees who are accordingly motivated to perform to the best of their
abilities. Both forms of incentive compensation are variable and accordingly
tied to corporate, strategic business unit, and individual performance levels
that encourage an explicit and continuing focus on increasing profitability and
shareholder value.
In assessing the performance and establishing the base salary and
incentive compensation of the chief executive officer and other members of the
Company's senior management, the personnel committee paid particular attention
to management's sustained success in operating the Company. Compensation for
each of the named officers, as well as other executive officers of the Company,
consists of base salary plus annual and long-term incentive compensation
components. Based on industry survey data for southeastern financial
companies, input from a nationally recognized independent compensation
consultant, and individual performance assessment, base salaries are adjusted
annually as appropriate to reflect individual performance levels and
competitiveness. The Company's base salary levels are generally competitive
with amounts paid to similar executives with comparable responsibilities at
other financial companies engaged in the same or similar businesses as the
Company. Annual and long-term incentive compensation is closely aligned to
factors that encourage retention of the Company's executives as well as success
in achieving significant financial performance goals.
The 1993 base salary of the Company's chief executive officer was set
independent of his participation, with advice from the Company's independent
consultant and with assistance from the Company's senior personnel official. In
setting the chief executive officer's base salary, special consideration was
given to the continued smooth and successful transition that has occurred since
the August 1990 changeover in chief executive officers, the chief executive
officer's effectiveness in solidifying the Company's ongoing management team,
and the Company's superior earnings record since his appointment.
Consideration was also given to the chief executive officer's personal job
performance, the Company's profitable growth record, as well as expectations of
his anticipated contributions to the Company's future. Prior to implementation
at the beginning of 1993, the committee's base salary recommendation for the
chief executive officer was reviewed and approved by the full board of
directors.
Based on recommendations to the personnel committee from the chief
executive officer, the 1993 base salaries for the other named officers were
recommended by the committee, using the same review process applied when
establishing the chief executive officer's base salary. The personnel
committee reviewed their individual recommendations regarding each named
officer with the board of directors and secured full board approval, prior to
applying base salary adjustments for this group at the beginning of 1993.
10
<PAGE> 14
Early in 1993, the personnel committee approved the Company's 1993
annual performance goals, as prepared by the Company's comptroller, and as used
for the purpose of determining potential annual incentive compensation for the
chief executive and the other named officers. The performance goals were
quantitative in nature, resulting in a bonus plan formula that is weighted
towards their overall importance in attaining the Company's annual profit plan,
and focused on the accomplishment of financial objectives in the areas of: Net
Income Before Securities Transactions, Return on Assets, Return on Equity,
Average Loan Growth, and Average Core Deposit Growth. With sustained record
earnings in 1993, the Company substantially exceeded target levels for most
Company and business unit performance goals. Based on the various levels of
goal achievement, the chief executive and the other named officers received
cash incentive awards as a formula driven percentage of 1993 base salary
levels.
During 1993, the personnel committee evaluated the merits of granting
the chief executive officer, the named officers and other key employees,
further awards under the Company's 1991 Long-Term Incentive Plan (LTIP). The
1991 LTIP provides the flexibility to grant long-term incentives in a variety
of forms, including stock options, performance shares and restricted stock.
With respect to stock based compensation, the personnel committee placed
relatively more reliance on the advice of the Company's independent consultant
than in the cases of base salary and non-stock based compensation. As intended
with the establishment of the 1991 LTIP, the committee believes that it is
highly desirable to increase management's equity ownership interest in the
Company. The committee further believes that its initial 1991 awards under the
LTIP awards successfully focused and committed the Company's management on
building profitability and shareholder value. The primary purpose of LTIP
awards is to encourage management members to take long-term steps to achieve
and sustain Return on Equity objectives. Accordingly, the committee further
awarded LTIP grants during 1993. Based on profitability levels achieved in
1993, the personnel committee additionally authorized the release of thirty
percent of previously granted awards to participants of record at the
conclusion of 1993. The committee has taken these actions, noting the opinion
of its independent consultant that such awards afford a highly desirable method
of aligning the interests of management with shareholders' interests.
In establishing the LTIP awards for the named officers, senior
management and other key employees, the committee reviewed with the chief
executive officer the recommended individual awards, considering the scope of
accountability, financial goals, and anticipated performance requirements and
contributions expected of each participant. LTIP awards for the chief
executive officer were set separately and independently of his participation,
based on ownership and total compensation objectives that reflected data from
selected peer companies, his total compensation, and the committee's perception
of his past and expected contributions to the Company's attainment of its
long-term performance goals.
Summary The personnel committee of the board of directors remains
dedicated to ensuring that the Company's overall compensation program for its
executive officers, senior management and other key employees is properly
designed to:
- Attract, motivate, and retain outstanding contributors.
- Maintain a base salary structure that is competitive in the Company's
marketplace.
- Link annual incentive awards with specific performance targets that
yield superior results.
- Provide long-term incentive awards that couple management ownership
with shareholder value.
The personnel committee will continue to review and evaluate
compensation programs at least annually. When and where appropriate, the
committee will consult with independent compensation consultants, legal
advisors, and our public accounting firm with respect to the proper design of
the program toward achieving Company objectives as set forth by the chief
executive officer and the board of directors.
This report furnished by:
H. Manning McPhillips, Jr. (Chairman)
James B. Boone, Jr. Albert P. Brewer
Catesby ap C. Jones Lee J. Styslinger, Jr.
Personnel Committee Interlocks and Insider Participation. No
executive officer-company director interlocks existed for the year 1993.
During 1993, J. Stanley Mackin, Chairman and Chief Executive Officer,
was an ex officio non-voting member of the personnel committee. Mr. Mackin
participated only in compensation recommendations, discussions and decisions
involving Company officers other than himself.
11
<PAGE> 15
Financial Performance
The following graph summarizes the total return performance
experienced by First Alabama's shareholders over the last five years compared
to the NASDAQ Banks Index and the S & P 500 Market Index.
Total Return Analysis
<TABLE>
<CAPTION>
YEARS FIRST ALABAMA NASDAQ BANKS S&P 500
<S> <C> <C> <C>
1988 100.00 100.00 100.00
1989 118.482 111.1539 127.25047
1990 127.835 81.400371 118.90393
1991 223.0484 133.5710478 150.1836382
1992 279.1738 194.18733 156.88823
1993 282.5827 221.3189479 167.956935
</TABLE>
Other Transactions
Directors and officers of First Alabama and their associates were
customers of, and had transactions with, the affiliate banks in the ordinary
course of business during 1993; additional transactions may be expected to take
place in the ordinary course of business. Included in such transactions are
outstanding loans and commitments from the affiliate banks, all of which were
made on substantially the same terms, including interest rates and collateral,
as those prevailing at the time for comparable transactions with other persons,
and did not involve more than the normal risk of collectibility or present
other unfavorable features.
First Alabama retained during 1993 and prior years and proposes to
retain in the future on behalf of the Company or certain of its subsidiaries
the law firms of Steiner, Crum & Baker, of which director Robert E. Steiner,
III, is a partner and Lange, Simpson, Robinson, & Somerville, of which director
Henry E. Simpson is a partner. During 1993, the Company or its subsidiaries
paid legal fees of $67,873 to the firm of Steiner, Crum & Baker and $600,225 to
the firm of Lange, Simpson, Robinson & Somerville.
INDEPENDENT AUDITORS
The audit committee has selected the accounting firm of Ernst & Young
to serve as the principal auditors for the Company for the current year. The
firm of Ernst & Young also served as First Alabama's principal auditor during
1993. A representative of the firm will be present at the stockholders'
meeting to make a statement if he so desires and to respond to appropriate
questions from stockholders.
AMENDMENTS TO THE CERTIFICATE OF INCORPORATION
Change of Corporate Name to Regions Financial Corporation
The board of directors of the Company has proposed an amendment to the
Certificate of Incorporation to change the name of the Company from First
Alabama Bancshares, Inc. to Regions Financial Corporation. The affirmative
vote of a majority of the outstanding shares is necessary to adopt this
amendment. Abstentions and broker non-votes will have the same effect as a
vote against the proposal.
12
<PAGE> 16
The Company has had the name First Alabama Bancshares, Inc. since it
was organized in 1970, and has transacted business under this name since it
commenced operations in 1971. The board of directors believes the name First
Alabama Bancshares, Inc. has served the Company well in its first 22 years of
operation, particularly during the time in which the Company's business was
concentrated almost exclusively in the state of Alabama.
In recent years, however, the Company has entered into the banking
business in other states. More specifically, since 1987 the Company has
acquired commercial banking operations in the states of Florida, Georgia and
Tennessee. With the acquisition of Secor Bank, Federal Savings Bank, on
December 31, 1993, the Company took on substantial operations in Louisiana.
Accordingly, the board of directors has concluded, given the Company's
present and contemplated future operations as a multi-state regional bank
holding company, that the Company's name should no longer carry the implication
of geographical limitation inherent in the name First Alabama Banchares, Inc.
The proposed new name, Regions Financial Corporation, intended to
connote the Company's view of itself as a regional financial services
enterprise, reflecting both its core business of banking and its banking
related businesses in the fields of investments and mortgage loan origination
and servicing.
Reflecting the Company's pride in its home state and the value of the
First Alabama franchise within the state of Alabama, the board of directors
intends that the Company's commercial bank in Alabama will continue to operate
under the name "First Alabama Bank." The name of the Company's Florida bank
already has been changed from Sunshine Bank to Regions Bank of Florida. The
Company has plans to change the names of subsidiaries in other states to
reflect the Regions trade name.
The board of directors recommends a vote "FOR" the proposal to amend
the Certificate of Incorporation changing the name of the corporation to
Regions Financial Corporation, under "Item 2" on the proxy card.
Increase in Authorized Common Stock
The board of directors has proposed an amendment to Item Fourth of the
Certificate of Incorporation of the Company to increase the number of
authorized shares from 60,000,000 to 120,000,000. The affirmative vote of
holders of 75% of the outstanding shares is necessary to adopt this amendment
to Item Fourth of the Certificate of Incorporation. Abstentions and broker
non-votes will have the same effect as a vote against the proposal.
The newly authorized but unissued shares, along with the presently
authorized and unissued shares, will be available for issuance at the
discretion of the board of directors. No stockholder approval is required for
the issuance of authorized but unissued shares of common stock. Stockholders
have no preemptive rights to subscribe for any of the shares which may be
issued by the Company from time to time.
Unissued shares of common stock will be available at the discretion of
the board of directors for future stock dividends, for acquisition of banks or
bank related companies, for issuance upon exercise of stock options or to raise
additional capital in public or private sales. On March 9, 1994, there were
42,520,025 shares issued of the 60,000,000 shares of stock currently
authorized, of which 1,470,700 shares were held in treasury and 41,049,325 were
issued and outstanding.
The board of directors has no present plans, agreements, or
commitments to issue authorized but unissued common stock, except 883,536
shares (subject to adjustment) to be issued in connection with the merger of
Guaranty Bancorp, Inc., Baton Rouge, Louisiana, with and into the Company,
which merger is expected to be consummated in the third quarter of 1994.
The board of directors believes that the amendment to increase the
number of authorized shares is advisable in order to give the Company
additional flexibility in the acquisition of financial institutions and related
businesses, and in consideration of transactions such as stock splits and stock
dividends.
The text of the proposed amendment to the Certificate of Incorporation
is set forth as Exhibit A to this proxy statement.
The board of directors recommends a vote "FOR" the amendment to Item
Fourth of the Certificate of Incorporation under "Item 3" of the Proxy card.
13
<PAGE> 17
Additional Considerations
Under existing state and federal securities laws, it is permissible
for a purchaser to acquire any proportion of the outstanding stock or a
publicly held company such as First Alabama. In the event of a non-negotiated
acquisition of a substantial percentage of the Company's stock either by tender
offer, open market purchases, or otherwise, the availability of authorized but
unissued shares of common stock could enable the company to make the
acquisition of control more difficult by issuing shares into "friendly" hands
or under circumstances which might dilute the acquiror's stockholdings. For
this reason, the authorization of additional common shares might be deemed to
have potential "anti-takeover" effects which should be considered in
determining whether to vote in favor of the proposals.
Section 203 of the Delaware General Corporation Law ("Section 203")
places certain restrictions on "business combinations" (as defined in Section
203, generally including mergers, sales and leases of assets, issuances of
securities, and similar transactions) by Delaware corporations with an
"interested stockholder" (as defined in Section 203, generally the beneficial
owner of 15% or more of the corporation's outstanding voting stock). Section
203 generally applies to Delaware corporations, such as First Alabama, that
have a class of voting stock listed on a national securities exchange,
authorized for quotation on an interdealer quotation system of a registered
national securities association, or held of record by more than 2,000
stockholders, unless the corporation expressly elects in its Certificate of
Incorporation or bylaws not to be governed by Section 203.
First Alabama has not specifically elected to avoid the application of
Section 203. As a result, Section 203 generally would prohibit a business
combination by First Alabama or a subsidiary with an interested stockholder
within three years after the person or entity becomes an interested stockholder,
unless (i) prior to the time when the person or entity becomes an interested
stockholder, First Alabama's board of directors approved either the business
combination or the transaction pursuant to which such person or entity became
an interested stockholder, (ii) upon consummation of the transaction in which
the person or entity became an interested stockholder, the interested
stockholder held at least 85% of the outstanding First Alabama voting stock
(excluding shares held by persons who are both officers and directors and
shares held by certain employee benefit plans), or (iii) once the person or
entity becomes an interested stockholder, the business combination is approved
by First Alabama's board of directors and by the holders of at least two-thirds
of the outstanding First Alabama voting stock, excluding shares owned by the
interested stockholder.
In addition, the Company's Certificate of Incorporation presently
includes several provisions which could be characterized as "anti-takeover"
provisions because they may be intended or perceived to discourage or delay a
takeover of control of the Company. These provisions (the "Protective
Provision") include: (1) the classification of the board of directors in three
classes with staggered terms of office, with accompanying provisions
restricting removal of directors in three classes with staggered terms of
office, with accompanying provisions restricting removal of directors by
stockholders; (2) a provision that approval by 75 percent of the outstanding
shares entitled to vote is required for any merger, consolidation, or sale or
lease of assets transaction with any holder of more than 5 percent of such
shares unless certain requirements are met; (3) a provision requiring that any
action by stockholders be taken at a meeting of stockholders rather than by
consent; (4) a provision governing the calling of special meetings of
stockholders; and (5) a provision requiring approval of 75 percent of the
outstanding shares entitled to vote for amendment of the by-laws or certain
provisions of the Certificate of Incorporation.
The board of directors believes the Protective Provisions are
beneficial to First Alabama's stockholders, in that they may serve to assist
First Alabama's board of directors in playing a role in connection with
attempts to acquire control of First Alabama, so that the board can further and
protect the interests of First Alabama and its stockholders as appropriate under
the circumstances. However, the Protective Provisions also may tend to
discourage some takeover bids. As a result, First Alabama's stockholders may
be deprived of opportunities to sell some or all of their shares at prices that
represent a premium over prevailing market prices.
The Protective Provisions also may discourage open market purchases by
a potential acquirer. Such purchases may increase the market price of First
Alabama common stock temporarily, enabling stockholders to sell their shares at
a price higher than that which otherwise would prevail. In addition, the
Protective Provisions may decrease the market price of First Alabama common
stock by making the stock less attractive to persons who invest in securities
in anticipation of price increases from potential acquisition attempts. The
Protective Provisions also may make it more difficult and time-consuming for a
potential acquirer to obtain control of First Alabama through replacing the
board of directors and management. Furthermore, the Protective Provisions may
make it more difficult for First Alabama's stockholders to replace the board of
directors or management, even if a majority of the stockholders believe such
replacement is in the best interests of First Alabama. As a result, the
Protective Provisions may tend to perpetuate the incumbent board of directors
and management.
14
<PAGE> 18
Financial Information
The following financial statements and other financial information,
which are set forth in the accompanying annual report to stockholders, are
incorporated herein by reference:
Consolidated Statements of Condition--December 31, 1993 and 1992.
Consolidated Statements of Income--Years ended December 31, 1993, 1992
and 1991.
Consolidated Statements of Changes in Stockholders' Equity--Years ended
December 31, 1993, 1992 and 1991.
Consolidated Statements of Cash Flows--Years ended December 31, 1993, 1992
and 1991.
Notes to Consolidated Financial Statements--Three years ended
December 31, 1993.
Management's Discussion and Analysis of Financial Condition and
Results of Operations.
PROPOSALS OF STOCKHOLDERS
Proposals by stockholders intended to be presented at First Alabama's
1995 annual meeting of stockholders must be received by First Alabama not later
than November 16, 1994, for inclusion in the proxy statement relating to that
meeting.
OTHER BUSINESS
First Alabama does not know of any business to be presented for action
at the meeting other than those items listed in the notice of the meeting and
referred to herein. If any other matters properly come before the meeting or
any adjournment thereof, it is intended that the proxies will be voted in
respect thereof in accordance with the recommendations of the board of
directors.
By Order of the Board of Directors,
L. Burton Barnes, III
Corporate Secretary
Dated March 16, 1994
15
<PAGE> 19
<TABLE>
<S> <C>
FIRST FIRST ALABAMA BANCSHARES, INC., P. O. BOX 10247, BIRMINGHAM, ALABAMA 35202
ALABAMA ANNUAL MEETING OF STOCKHOLDERS - APRIL 27, 1994
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
MANAGEMENT RECOMMENDS A VOTE "FOR" ITEMS (1), (2), (3) AND (4).
</TABLE>
Henry E. Simpson and J. Stanley Mackin and each of them are hereby
appointed proxies, with the power of substitution, to vote all stock of the
undersigned at the Annual Meeting of Stockholders of First Alabama Bancshares,
Inc. to be held in the Auditorium of First Alabama Bank, 8 Commerce Street,
Montgomery, Alabama, on Wednesday, April 27, 1994, at 9:30 A.M. Montgomery
time, and at any adjournment thereof, on the following matters:
(1) The election of the five (5) nominees for directors listed below.
FOR all nominees listed below ________ WITHHOLD AUTHORITY to vote for
all nominees ________
For a term of three years: James B. Boone, Jr., Albert P. Brewer, James S. M.
French, Richard D. Horsley and J. Stanley Mackin.
(INSTRUCTION: TO WITHHOLD AUTHORITY TO VOTE FOR ANY INDIVIDUAL NOMINEE WRITE
THE NOMINEE'S NAME IN THE SPACE PROVIDED BELOW.)
________________________________________________________________________________
(2) To consider and act upon a proposal to amend Item First of the
Certificate of Incorporation to change the name of the corporation
from First Alabama Bancshares, Inc. to Regions Financial Corporation.
FOR AGAINST ABSTAIN
----- ----- -----
(3) To consider and act upon a proposal to amend Item Fourth of the
Certificate of Incorporation to provide for an increase in the number
of authorized shares of common stock to 120,000,000.
FOR AGAINST ABSTAIN
----- ----- -----
(4) In their discretion on such other business as may properly be
brought before the meeting or any adjournment thereof.
FOR AGAINST ABSTAIN
----- ----- -----
- -------------------------------------------------------------------------------
THIS PROXY WHEN PROPERLY EXECUTED WILL BE VOTED IN ACCORDANCE WITH INSTRUCTIONS
GIVEN. IN THE ABSENCE OF INSTRUCTIONS, THIS PROXY WILL BE VOTED "FOR" ITEMS
(1), (2), (3) AND (4). THIS PROXY MAY BE REVOKED AT ANY TIME PRIOR TO ITS
EXERCISE.
(Please sign exactly as your name appears on the left. If shares are held
jointly, each stockholder should sign. If signing as attorney, executor,
administrator, trustee or guardian, please give full title.) Please sign, date
and return this proxy immediately in the enclosed, postage paid envelope.
, 1994
------------------------------------------
------------------------------------------
Signature of Stockholder
------------------------------------------
Signature of Stockholder
<PAGE> 20
EXHIBIT A
Fourth. The total number of shares of common stock which the
corporation shall have the authority to issue is One Hundred Twenty Million
(120,000,000) shares. The par value of each such share is Sixty-two and
One-half Cents ($0.625), amounting in the aggregate to Seventy-Five Million
Dollars ($75,000,000). The corporation shall issue no fractional shares.
On any matters requiring the vote of stockholders, including the
election of directors, each stockholder shall be entitled to one vote for each
share of common stock owned. There shall be no cumulative voting.
The holders of common stock shall have no preemptive rights.
17
