<PAGE> 1
SCHEDULE 14A
(RULE 14A-101)
INFORMATION REQUIRED IN PROXY STATEMENT
SCHEDULE 14A INFORMATION
PROXY STATEMENT PURSUANT TO SECTION 14(A) OF THE SECURITIES
EXCHANGE ACT OF 1934 (AMENDMENT NO. )
Filed by the Registrant [X]
Filed by a Party other than the Registrant [ ]
Check the appropriate box:
<TABLE>
<S> <C>
[X] Preliminary Proxy Statement [ ] Confidential, for Use of the Commission
Only (as permitted by Rule 14a-6(e)(2))
[ ] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to Rule 14a-11(c) or Rule 14a-12
</TABLE>
REGIONS FINANCIAL CORPORATION
- - --------------------------------------------------------------------------------
(Name of Registrant as Specified In Its Charter)
- - --------------------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
[X] No fee required.
[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and 0-11.
(1) Title of each class of securities to which transaction applies:
(2) Aggregate number of securities to which transaction applies:
(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (set forth the amount on which the
filing fee is calculated and state how it was determined):
(4) Proposed maximum aggregate value of transaction:
(5) Total fee paid:
[ ] Fee paid previously with preliminary materials:
[ ] Check box if any part of the fee is offset as provided by Exchange Act Rule
0-11(a)(2) and identify the filing for which the offsetting fee was paid
previously. Identify the previous filing by registration statement number,
or the Form or Schedule and the date of its filing.
(1) Amount Previously Paid:
(2) Form, Schedule or Registration Statement No.:
(3) Filing Party:
(4) Date Filed:
<PAGE> 2
REGIONS FINANCIAL CORPORATION
POST OFFICE BOX 10247
BIRMINGHAM, ALABAMA 35202-0247
TELEPHONE 205 326-7100
To the Stockholders:
You are cordially invited to attend the twenty-eighth annual meeting of the
stockholders of Regions Financial Corporation to be held at 10:00 a.m. local
time, on May 19, 1999, at the SanDestin Hilton, 4000 SanDestin Blvd., Destin,
Florida 32541.
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 10:00 a.m., in the
room at the SanDestin Hilton. We hope you will find it convenient
to come early enough to enjoy this social time prior to the stockholders'
meeting.
J. Stanley Mackin
Chairman of the Board
April 7, 1999
<PAGE> 3
REGIONS FINANCIAL CORPORATION
POST OFFICE BOX 10247
BIRMINGHAM, ALABAMA 35202-0247
TELEPHONE 205 326-7100
---------------------
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
To be held May 19, 1999
---------------------
NOTICE IS HEREBY GIVEN that the annual meeting of stockholders of Regions
Financial Corporation (Regions or Company), a Delaware corporation, will be held
at the SanDestin Hilton, 4000 SanDestin Blvd., Destin, Florida 32541, on
Wednesday, May 19, 1999, at 10:00 a.m. local 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 approve an amendment to Article EIGHTH of the Certificate of
Incorporation to remove reference to retirement of directors, and
to ratify a restatement of the Certificate of Incorporation.
3. To approve the Management Incentive Plan, an annual incentive
compensation plan.
4. To approve the 1999 Long Term Incentive Plan, an incentive
compensation plan.
5. To transact 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 26, 1999, 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 Regions
Bank, 417 North 20th Street, Birmingham, Alabama. Stockholders are invited to
attend the meeting in person.
Please sign and date the accompanying proxy card and return it promptly in
the enclosed postage-paid envelope whether or not you plan to attend the meeting
in person. In the alternative, you may vote your shares by telephone or via the
Internet. Instructions are included with the proxy card. If you attend the
Annual Meeting, you may vote in person if you wish, even if you previously have
returned your proxy card or voted by telephone or on the Internet. The proxy may
be revoked at any time prior to its exercise.
By Order of the Board of Directors
Samuel E. Upchurch, Jr.
Corporate Secretary
April 7, 1999
<PAGE> 4
REGIONS FINANCIAL CORPORATION
POST OFFICE BOX 10247
BIRMINGHAM, ALABAMA 35202-0247
TELEPHONE 205 326-7100
---------------------
PROXY STATEMENT
FOR 1999 ANNUAL MEETING OF STOCKHOLDERS
---------------------
Regions Financial Corporation (Regions or the Company) is furnishing this
Proxy Statement to the stockholders in connection with the 1999 annual meeting
of stockholders to be held on Wednesday, May 19, 1999, at 10:00 a.m. local time
at the SanDestin Hilton, 4000 SanDestin Blvd., Destin, Florida 32541, 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) proposal to
approve an amendment to and restatement of the Certificate of Incorporation to
delete reference to the retirement of directors, and to ratify a restatement of
the Certificate of Incorporation, (3) proposal to approve the Management
Incentive Plan, (4) proposal to approve the 1999 Long Term Incentive Plan, and
(5) such other business as may properly come before the meeting.
The enclosed proxy is solicited on behalf of the board of directors of
Regions 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.
Participants in Regions' Dividend Reinvestment Plan, Employee Stock
Purchase Plan, and Directors' Stock Incentive Plan will note that shares held by
the administrator for such plans 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 such plans.
The annual report of Regions Financial Corporation for the year 1998,
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.
The date of this proxy statement is April 7, 1999.
<PAGE> 5
SOLICITATION, VOTING, AND REVOCABILITY OF PROXIES
This is the first mailing of proxy solicitation materials to stockholders.
Regions will solicit proxies by mail and also may solicit proxies by telephone
or telegram or in person by the directors, officers, and employees of Regions,
who will receive no additional compensation for such solicitation but may be
reimbursed for out-of-pocket expenses. Brokerage houses, nominees, fiduciaries,
and other custodians will be requested to forward solicitation materials to
beneficial owners and will be reimbursed for their out-of-pocket expenses.
Regions has retained D.F. King & Co., Inc. to assist in the solicitation of
proxies. It is anticipated that the fee of such firm will not exceed $7,000 plus
reasonable out-of-pocket costs and expenses authorized by Regions.
Stockholders are urged to sign and date the enclosed proxy card and return
it as promptly as possible in the envelope enclosed for that purpose.
Stockholders of record can also give proxies by calling a toll-free telephone
number or by using the Internet. The telephone and Internet voting procedures
are designed to authenticate Regions stockholders' identities, to allow Regions
stockholders to give their voting instructions, and to confirm that Regions
stockholders' instructions have been recorded properly. Regions has been advised
by counsel that the procedures that have been put in place for telephone and
Internet voting are consistent with the requirements of applicable law.
Stockholders who wish to vote over the Internet should be aware that there may
be costs associated with electronic access, such as usage charges from Internet
access providers and telephone companies, and that there may be some risk a
stockholder's vote might not be properly recorded or counted because of an
unanticipated electronic malfunction.
Any Regions stockholder who has delivered a proxy or voted by telephone or
the Internet may revoke it at any time before it is voted by giving notice of
revocation in writing or submitting to Regions a signed proxy card bearing a
later date, provided that such notice or proxy card is actually received by
Regions before the vote of stockholders or in open meeting prior to the taking
of stockholder vote at the Regions Annual Meeting. Any notice of revocation
should be sent to Regions Financial Corporation, 417 North 20th Street,
Birmingham, Alabama 35203; Attention: Samuel E. Upchurch, Jr., Corporate
Secretary. A proxy will not be revoked by death or supervening incapacity of the
stockholder executing the proxy unless, before the vote, notice of such death or
incapacity is filed with the Corporate Secretary.
The shares of Regions Common Stock represented by properly executed proxies
received at or prior to the Annual Meeting and not subsequently revoked will be
voted as directed in such proxies. If instructions are not given, shares
represented by proxies received will be voted for the election of the five
nominees for director named in this proxy statement, for the approval of the
amendment to and restatement of the certificate of incorporation, for approval
of the management incentive plan, for approval of the 1999 Long Term Incentive
Plan, and in the discretion of the proxy holder as to any other matters that
properly may come before the Annual Meeting. If necessary, and unless contrary
instructions are given, the proxy holder also may vote in favor of a proposal to
adjourn the Annual Meeting to permit further solicitation of proxies in order to
obtain sufficient votes to approve the matters presented or any other matter
that properly comes before the Annual Meeting. Proxies representing shares which
were voted against any of the matters presented will not be voted in favor of
any proposal to adjourn the Annual Meeting.
Please note that the procedures for voting by telephone or over the
Internet differ depending on whether Regions are held in your own name or are
held for you in a nominee or brokerage account ("street" name).
For Regions shares held in your name:
Any Regions stockholder of record desiring to vote by telephone or over the
Internet will be required to enter the unique control number imprinted on such
holder's Regions proxy card, and therefore should have the proxy card in hand
when initiating the session.
- To vote by telephone, dial 1-800-OK2-VOTE (1-800-652-8683) on a touch
tone telephone, and follow the simple menu instructions provided. There
is no charge for this call.
- To vote over the Internet, log on to the website
http://www.vote-by-net.com and follow the simple instructions provided.
Similar instructions are included on the enclosed Regions proxy card.
2
<PAGE> 6
For Regions shares held in nominee accounts ("street" name):
A number of brokerage firms and banks are participating in a program
provided through ADP Investor Communication Services that offers telephone and
Internet voting options. This program is different than the program for shares
registered in the name of the stockholder. If your shares are held in an account
at a brokerage firm or bank participating in the ADP program, you may vote those
shares telephonically by calling the telephone number referenced on your voting
form. Votes submitted via the Internet through the ADP program must be received
by , 1999. The giving of such proxy will not affect your right to vote
in person should you decide to attend the Annual Meeting.
VOTING SECURITIES AND PRINCIPAL HOLDERS THEREOF
As of March 26, 1999, Regions had issued and outstanding
shares of common stock, of which were held as
treasury stock. 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 26, 1999, will be entitled to vote at the meeting or any
adjournment thereof.
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS
As of December 31, 1998, all Regions' affiliate banks beneficially held in
a fiduciary capacity for others under numerous trust relationships, 12,920,186
shares or 5.86% of Regions' outstanding common stock. Regions' affiliate bank
trust departments have sole voting power with respect to 11,918,532 of these
shares or 5.41%, shared voting power with respect to 43,541 of these shares,
sole dispositive power with respect to 5,914,144 of these shares and shared
dispositive power with respect to 2,239,488 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 Regions' common stock as of March 26, 1999. All directors and executive
officers of Regions, as a group, own beneficially a total of
, , shares (which includes , shares
that are the subject of presently exercisable options) or . %
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 Regions' common stock by certain of its executive officers at March
26, 1999. For beneficial ownership information of each director, see "Election
of Directors."
<TABLE>
<CAPTION>
REGIONS STOCK BENEFICIALLY OWNED
---------------------------------
NAME AND ADDRESS TITLE OF CLASS NO. OF SHARES(1) % OF CLASS
- - ---------------- -------------- ----------------- -----------
<S> <C> <C> <C>
J. Stanley Mackin................................ Common
Birmingham, Alabama
Carl E. Jones, Jr................................ Common
Birmingham, Alabama
Richard D. Horsley............................... Common
Birmingham, Alabama
William E. Jordan................................ Common
Birmingham, Alabama
Sam P. Faucett................................... Common
Tuscaloosa, Alabama
</TABLE>
- - ---------------
(1) The amounts shown represent the total shares beneficially owned by such
individuals, restricted shares (80,000 for Mr. Mackin, 5,641 for Mr. Jones,
and 2,820 for each of the other individuals) and shares which are issuable
upon the exercise of all stock options 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, , ; Mr.
Jones, , ; Mr. Horsley,
, ; Mr. Jordan,
, , and Mr. Faucett,
, .
3
<PAGE> 7
No change in control of Regions has occurred since January 1, 1998, and no
arrangements are known to Regions which may at a later date result in a change
in control of the Company.
ELECTION OF DIRECTORS
Regions recommends that the board of directors for the ensuing year shall
consist of sixteen directors, and further recommends the election of Sheila S.
Blair, Barnett Grace, Olin B. King, Lee J. Styslinger, Jr., and C. Kemmons
Wilson, Jr. as directors, to hold office for a term of three years expiring with
the annual meeting of stockholders to be held in 2002 or until their successors
are elected and qualified. The terms of office of eleven 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.
Regions 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.
INFORMATION ON DIRECTORS
The following table indicates the age, residence, principal occupation or
employment for the last five years of each nominee and director whose term of
office continues after the meeting, position and offices held with Regions 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 26, 1999.
<TABLE>
<CAPTION>
YEAR
PRESENT OCCUPATION POSITION AND YEAR TERM OF
NAME OF NOMINEE AND PRINCIPAL OFFICES HELD WITH FIRST OFFICE
OR DIRECTOR, OCCUPATION FOR REGIONS AND ELECTED WILL
RESIDENCE, AND AGE LAST FIVE YEARS SUBSIDIARIES AS DIRECTOR EXPIRE
- - ------------------ -------------------- --------------------- --------------------- -------
<S> <C> <C> <C> <C>
Sheila S. Blair(1) Retired, formerly Director, Regions 1989 1999
Birmingham, Alabama Executive Director,
64 The Greater
Birmingham
Foundation
(Community
Foundation)
James B. Boone, Jr. Chairman of the Director, Regions 1985 2000
Tuscaloosa, Alabama Board, Boone
63 Newspapers, Inc.
(Newspaper
Publishing,
Management and
Ownership)
James S.M. French Chairman and Director, Regions 1986 2000
Birmingham, Alabama President, Dunn
59 Investment Co.
(Construction,
Construction
Materials,
Investments)
Barnett Grace(1) Regional President, Director, Regions and 1998 1999
Little Rock, Regions, formerly Regions Bank
Arkansas Chairman & Chief
54 Executive Officer,
First Commercial
Corp.
Frank D. Chairman, TCBY Director, Regions 1998 2001
Hickingbotham Enterprises, Inc.
Little Rock, (frozen yogurt
Arkansas manufacturing and
62 franchising)
<CAPTION>
NUMBER OF SHARES BENEFICIALLY
OWNED AT MARCH 26, 1999
NAME OF NOMINEE --------------------------------
OR DIRECTOR, (2) PERCENT
RESIDENCE, AND AGE DIRECTLY INDIRECTLY OF CLASS
- - ------------------ -------- ---------- --------
<S> <C> <C> <C>
Sheila S. Blair(1) %
Birmingham, Alabama
64
James B. Boone, Jr.
Tuscaloosa, Alabama
63
James S.M. French
Birmingham, Alabama
59
Barnett Grace(1)
Little Rock,
Arkansas
54
Frank D.
Hickingbotham
Little Rock,
Arkansas
62
</TABLE>
4
<PAGE> 8
<TABLE>
<CAPTION>
YEAR
PRESENT OCCUPATION POSITION AND YEAR TERM OF
NAME OF NOMINEE AND PRINCIPAL OFFICES HELD WITH FIRST OFFICE
OR DIRECTOR, OCCUPATION FOR REGIONS AND ELECTED WILL
RESIDENCE, AND AGE LAST FIVE YEARS SUBSIDIARIES AS DIRECTOR EXPIRE
- - ------------------ -------------------- --------------------- --------------------- -------
<S> <C> <C> <C> <C>
Richard D. Horsley Vice Chairman of the Director, Regions; 1982 2000
Birmingham, Alabama Board and Executive Director, Regions
56 Financial Officer, Bank, Regions Agency,
Regions and Regions Inc., Regions
Bank Mortgage, Inc.,
Regions Life
Insurance Company,
Regions Financial
Building Corp.,
Ramco-FL Holding,
Management Co.,
Ramco-FL Holding,
Inc., and Ramco-FL,
Inc.
Carl E. Jones, Jr. President and Chief Director, Regions and 1997 2001
Birmingham, Alabama Executive Officer, Regions Bank
58 Regions and Regions
Bank, formerly
Regional President,
Regions
Olin B. King(1) Chairman and CEO, Director, Regions 1984 1999
Huntsville, Alabama SCI Systems, Inc.
65 (Diversified
Electronics
Manufacturer)
J. Stanley Mackin Chairman, Regions Director, Regions, 1990 2000
Birmingham, Alabama and Regions Bank; Regions Bank, Regions
66 Formerly Chief Agency, Inc., Regions
Executive Officer, Mortgage, Inc., and
Regions and Regions Regions Life
Bank Insurance Company
Michael W. Murphy El President, Marmick Director, Regions 1998 2001
Dorado, Arkansas 51 Oil Company (Oil and
gas exploration and
production)
Henry E. Simpson Attorney, Lange, Director, Regions 1973 2001
Birmingham, Alabama Simpson, Robinson &
64 Somerville LLP
W. Woodrow Stewart Attorney, Stewart, Director, Regions 1999 2000
Gainesville, Melvin & Frost
Georgia 60
Lee J. Styslinger, Chairman, ALTEC Director, Regions 1985 1999
Jr.(1) Industries, Inc.
Birmingham, Alabama (Manufacturer of
66 mobile utility
equipment)
John H. Watson Chairman, Smith, Director, Regions 1999 2001
Dothan, Alabama Inc. (Heating and
61 air conditioning)
Robert J. Williams Chairman and Chief Director, Regions 1996 2001
Mobile, Alabama Executive Officer,
69 Terminix Services,
Inc. (Pest control)
<CAPTION>
NUMBER OF SHARES BENEFICIALLY
OWNED AT MARCH 26, 1999
NAME OF NOMINEE --------------------------------
OR DIRECTOR, (2) PERCENT
RESIDENCE, AND AGE DIRECTLY INDIRECTLY OF CLASS
- - ------------------ -------- ---------- --------
<S> <C> <C> <C>
Richard D. Horsley (3)
Birmingham, Alabama
56
Carl E. Jones, Jr. (3)
Birmingham, Alabama
58
Olin B. King(1)
Huntsville, Alabama
65
J. Stanley Mackin (3)
Birmingham, Alabama
66
Michael W. Murphy El
Dorado, Arkansas 51
Henry E. Simpson
Birmingham, Alabama
64
W. Woodrow Stewart
Gainesville,
Georgia 60
Lee J. Styslinger,
Jr.(1)
Birmingham, Alabama
66
John H. Watson
Dothan, Alabama
61
Robert J. Williams
Mobile, Alabama
69
</TABLE>
5
<PAGE> 9
<TABLE>
<CAPTION>
YEAR
PRESENT OCCUPATION POSITION AND YEAR TERM OF
NAME OF NOMINEE AND PRINCIPAL OFFICES HELD WITH FIRST OFFICE
OR DIRECTOR, OCCUPATION FOR REGIONS AND ELECTED WILL
RESIDENCE, AND AGE LAST FIVE YEARS SUBSIDIARIES AS DIRECTOR EXPIRE
- - ------------------ -------------------- --------------------- --------------------- -------
<S> <C> <C> <C> <C>
C. Kemmons Wilson, Chairman, Wilson Director, Regions 1999 1999
Jr.(1) Hotel Management
Memphis, Tennessee Co., Inc. (Hotel
52 management and
franchising)
<CAPTION>
NUMBER OF SHARES BENEFICIALLY
OWNED AT MARCH 26, 1999
NAME OF NOMINEE --------------------------------
OR DIRECTOR, (2) PERCENT
RESIDENCE, AND AGE DIRECTLY INDIRECTLY OF CLASS
- - ------------------ -------- ---------- --------
<S> <C> <C> <C>
C. Kemmons Wilson,
Jr.(1)
Memphis, Tennessee
52
</TABLE>
- - ---------------
(1) Nominee for election at 1999 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/her home, or
(d) owned by a corporation, partnership or other legal organization in which
the director has a substantial beneficial interest.
(3) Includes , shares for Mr. Mackin,
, shares for Mr. Jones, and
, shares for Mr. Horsley that are the subject of
presently exercisable options.
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 "control persons" of the Company are J. Stanley Mackin, Chairman,
Carl E. Jones, Jr., President 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, five 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, Hilb, Rogal and Hamilton Company, and Protective Life Corporation;
Frank D. Hickingbotham serves as a director of TCBY Enterprises, Inc.; Olin B.
King serves as a director of SCI Systems, Inc.; Michael W. Murphy serves as a
director of Murphy Oil Corporation; and Lee J. Styslinger, Jr. serves as a
director of The Mead Corporation.
THE BOARD AND COMMITTEES OF THE BOARD
Regions held six directors' meetings during 1998. 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, except James S. M. French, who attended
66.7% of Regions' directors' meetings and 57.1% of committee meetings, and
Robert J. Williams, who attended 83.3% of Regions' directors' meetings and 57.1%
of committee meetings. Among other board committees, Regions has an audit
committee and a compensation committee that meet as needed. While Regions has no
nominating committee designated as such, the functions of a nominating committee
are performed by the personnel committee.
Audit Committee. The members of the audit committee are Sheila Blair
(Chairman), Albert Brewer, and Frank Hickingbotham. The principal functions of
the audit committee, which held four meetings during 1998, include selecting
independent auditors, approving 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 its review.
Compensation Committee. The compensation committee, which held four
meetings during 1998, consists of Lee J. Styslinger, Jr. (Chairman), Albert P.
Brewer, and Sheila Blair.
The role of the compensation committee is to establish and monitor
compensation issues within the broad area of human resources management. The
compensation committee exercises 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.
6
<PAGE> 10
The functions of the compensation 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).
In discharging its responsibility, the compensation 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 Regions'
executive officers and directors to file reports of ownership and changes in
ownership of Regions' stock with the Securities and Exchange Commission.
Executive officers and directors are required by SEC regulations to furnish
Regions with copies of all Section 16(a) forms they file.
Based on a review of the forms filed during 1998, Regions believes that its
executive officers and directors complied with all applicable filing
requirements.
EXECUTIVE COMPENSATION AND OTHER TRANSACTIONS
The following table is a summary of certain information concerning the
compensation earned by Regions' 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>
ANNUAL COMPENSATION LONG TERM COMPENSATION
---------------------------------- ---------------------------------
AWARDS PAYOUTS
OTHER -------------------- ---------- ALL
ANNUAL RESTRICTED STOCK LTIP OTHER
NAME AND PRINCIPAL POSITION YEAR SALARY BONUS COMPENSATION STOCK(1) OPTIONS PAYOUTS COMPENSATION
- - --------------------------- ---- -------- -------- ------------ ---------- ------- ---------- ------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
J. Stanley Mackin................. 1998 $735,000 $ 0 0 $ 0 0 $2,265,625 $573,431(2)
Chairman........................ 1997 735,000 661,500 0 2,132,500 150,000 1,420,778 532,470
1996 700,000 630,000 0 1,720,000 150,000 743,985 441,961
Carl E. Jones, Jr................. 1998 500,000 356,175 0 0 33,750 1,054,688 72,778(3)
President and Chief............. 1997 350,000 200,556 0 218,589 14,359 607,553 67,847
Executive Officer............... 1996 242,000 147,969 0 0 30,000 349,030 61,103
Richard D. Horsley................ 1998 299,667 149,427 0 0 26,250 1,054,688 86,666(4)
Vice Chairman and............... 1997 275,000 173,250 0 109,275 7,180 598,433 82,405
Executive Financial Officer..... 1996 262,500 165,375 0 0 30,000 349,030 72,944
William E. Jordan................. 1998 271,767 141,347 0 0 26,250 1,054,688 141,877(5)
Regional President.............. 1997 248,000 155,953 0 109,275 7,180 598,433 131,505
1996 233,000 147,017 0 0 30,000 349,030 112,616
Sam P. Faucett.................... 1998 265,825 138,212 0 0 26,250 1,054,688 131,915(6)
Regional President.............. 1997 245,000 153,881 0 109,275 7,180 598,433 121,227
1996 232,000 146,282 0 0 30,000 349,030 104,338
</TABLE>
- - ---------------
(1) The Terms of the Restricted Stock awards are determined by the compensation
committee. Under the terms of the currently outstanding Restricted Stock
awards, the named executives must remain employed with Regions 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 compensation 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 compensation committee has the discretion
to modify the terms of the
7
<PAGE> 11
Restricted Stock awards. At December 31, 1998, Mr. Mackin had 80,000 shares
of Restricted Stock with fair market value of $3,225,000, Mr. Jones had
5,641 shares of Restricted Stock with a fair market value of $227,403, and
Messrs. Horsley, Jordan, and Faucett each had 2,820 shares of Restricted
Stock with a fair market value of $113,681.
(2) Includes $2,922 allocated to Mr. Mackin in 1998 under the Employee Stock
Ownership Plan; $21,078 allocated to Mr. Mackin in 1998 under the profit
sharing plan; and $549,431 representing the estimated term component of the
premium paid and the estimated interest cost to Regions in 1998 resulting
from premium payments for a life insurance benefit plan for Mr. Mackin. This
plan serves as an offset to an existing supplemental retirement plan.
(3) Includes $2,922 allocated to Mr. Jones in 1998 under the Employee Stock
Ownership Plan; $21,078 allocated to Mr. Jones in 1998 under the profit
sharing plan; and $48,778 representing the estimated term component of the
premium paid and the estimated interest cost to Regions in 1998 resulting
from premium payments for a life insurance benefit plan for Mr. Jones. This
plan serves as an offset to an existing supplemental retirement plan.
(4) Includes $2,922 allocated to Mr. Horsley in 1998 under the Employee Stock
Ownership Plan; $21,078 allocated to Mr. Horsley in 1998 under the profit
sharing plan; and $62,666 representing the estimated term component of the
premium paid and the estimated interest cost to Regions in 1998 resulting
from premium payments for a life insurance benefit plan for Mr. Horsley.
This plan serves as an offset to an existing supplemental retirement plan.
(5) Includes $2,922 allocated to Mr. Jordan in 1998 under the Employee Stock
Ownership Plan; $21,078 allocated to Mr. Jordan in 1998 under the profit
sharing plan; and $117,877 representing the estimated term component of the
premium paid and the estimated interest cost to Regions in 1998 resulting
from premium payments for a life insurance benefit plan for Mr. Jordan. This
plan serves as an offset to an existing supplemental retirement plan.
(6) Includes $2,922 allocated to Mr. Faucett in 1998 under the Employee Stock
Ownership Plan; $21,078 allocated to Mr. Faucett in 1998 under the profit
sharing plan; and $107,915 representing the estimated term component of the
premium paid and the estimated interest cost to Regions in 1998 resulting
from premium payments for a life insurance benefit plan for Mr. Faucett.
This plan serves as an offset to an existing supplemental retirement plan.
STOCK OPTIONS
The following table presents information concerning individual grants of
options to purchase Regions' common stock made during 1998 to the named
executive officers.
OPTION GRANTS IN THE LAST FISCAL YEAR
<TABLE>
<CAPTION>
NUMBER OF % OF TOTAL EXERCISE
SECURITIES UNDERLYING OPTIONS GRANTED PRICE GRANT DATE
NAME OPTIONS GRANTED TO EMPLOYEES IN 1998 (PER SHARE) EXPIRATION DATE PRESENT VALUE(1)
- - ---- --------------------- -------------------- ----------- --------------- ----------------
<S> <C> <C> <C> <C> <C>
J. Stanley Mackin.... 0 -- -- -- --
Carl E. Jones, Jr.... 33,750 2.9% $41.34 April 9, 2008 $285,034
Richard D. Horsley... 26,250 2.3 41.34 April 9, 2008 222,047
William E. Jordan.... 26,250 2.3 41.34 April 9, 2008 222,047
Sam P. Faucett....... 26,250 2.3 41.34 April 9, 2008 222,047
</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 .1930, risk-free rate of return of 4.54%,
dividend yield of 2.3% and expected time to exercise of 5.5 years.
8
<PAGE> 12
(2) All options become exercisable 12 months after the date of grant, except
that exercisability is delayed for an additional 12 months to the extent the
value of incentive stock options (determined as of the date of grant) first
exercisable in a calendar year exceeds $100,000 as to any recipient.
The following table presents information concerning exercises of stock
options to purchase Regions' common stock during 1998 and the number and value
of unexercised options and stock appreciation rights (SAR) held by the named
executive officers.
AGGREGATED OPTION/SAR EXERCISES IN 1998
<TABLE>
<CAPTION>
NUMBER OF SECURITIES VALUE OF UNEXERCISED
UNDERLYING UNEXERCISED IN-THE-MONEY
OPTIONS/SARS OPTIONS/SARS
AT 12-31-98 AT 12-31-98
SHARES ACQUIRED VALUE EXERCISABLE/ EXERCISABLE/
NAME ON EXERCISE REALIZED UNEXERCISABLE UNEXERCISABLE
- - ---- --------------- -------- ---------------------- --------------------
<S> <C> <C> <C> <C>
J. Stanley Mackin............. 0 $ 0 647,650/ 3,750(1) $13,575,227/51,211
Carl E. Jones, Jr............. 13,626 296,159 143,139/36,330(2) 3,117,467/ 4,031
Richard D. Horsley............ 0 0 118,224/28,830(3) 2,576,917/ 4,031
William E. Jordan............. 10,706 269,091 124,344/28,830(4) 2,819,759/ 4,031
Sam P. Faucett................ 12,524 366,328 156,960/28,830(5) 3,809,010/ 4,031
</TABLE>
- - ---------------
(1) Of Mr. Mackin's currently exercisable options, none were granted with tandem
SARs.
(2) Of Mr. Jones' currently exercisable options, 4,160 were granted with tandem
SARs.
(3) Of Mr. Horsley's currently exercisable options, none were granted with
tandem SARs.
(4) Of Mr. Jordan's currently exercisable options, none were granted with tandem
SARs.
(5) Of Mr. Faucett's currently exercisable options, 14,080 were granted with
tandem SARs.
LONG-TERM INCENTIVE PLAN AWARDS IN 1998
The following table presents information concerning the long-term
incentives awarded to Regions' 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) NO. NO. NO.
- - ---- ---------------- ---------------- ---------- ------- --------
<S> <C> <C> <C> <C> <C>
J. Stanley Mackin.................... -- -- -- -- --
Carl E. Jones, Jr.................... 11,250 5 years 5,625 11,250 11,250
Richard D. Horsley................... 8,750 5 years 4,375 8,750 8,750
William E. Jordan.................... 8,750 5 years 4,375 8,750 8,750
Sam P. Faucett....................... 8,750 5 years 4,375 8,750 8,750
</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 Regions common stock at the maturation date.
(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 earnings per share and return on equity by
the Company. 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 compensation 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 compensation committee has the
discretion to modify the terms of the Long-term Incentive Plan awards.
9
<PAGE> 13
RETIREMENT PLANS
The named executive officers are covered by the Regions Financial
Corporation Retirement Plan, 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.
PENSION PLAN TABLE
<TABLE>
<CAPTION>
AGE AT RETIREMENT
---------------------------------------------------------------
COMPENSATION 55 60 62 63 64 65
------------ -------- -------- -------- -------- -------- --------
<S> <C> <C> <C> <C> <C> <C>
$125,000........................... $ 50,000 $ 62,500 $ 67,500 $ 70,000 $ 72,500 $ 75,000
$150,000........................... $ 60,000 $ 75,000 $ 81,000 $ 84,000 $ 87,000 $ 90,000
$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
$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
$700,000........................... $280,000 $350,000 $378,000 $392,000 $406,000 $420,000
$750,000........................... $300,000 $375,000 $405,000 $420,000 $435,000 $450,000
</TABLE>
In 1998, compensation covered by the plans for the five highest paid
executive officers was as follows: Mr. Mackin, $735,000; Mr. Jones, $500,000;
Mr. Horsley, $299,667; Mr. Jordan, $271,767, and Mr. Faucett, $265,825.
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 and executive life insurance program cash values exceeding
premiums paid. Benefits are not offset by Social Security benefits. Benefits
will be reduced or eliminated if the participant terminates employment
voluntarily before age 55.
EMPLOYMENT AGREEMENTS
Regions has no employment agreements with any of the named executive
officers.
DIRECTORS' COMPENSATION
In 1998, directors of Regions were paid an annual directors' fee retainer
of $25,000, plus an additional annual retainer of $4,000 for each committee of
the board on which a director serves (or $6,000 in the case of the credit
committee), and an additional annual chairman's retainer of $2,000 for each
committee chairman. 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.
Non-employee directors of Regions are eligible to participate in Regions
directors' deferred stock plan, under which a participating director may elect
to defer receipt of the participant's directors' fee retainer, which is invested
in Regions common stock and maintained in a rabbi trust. Regions contributes 25%
of the amount contributed by each participating director. Receipt and taxability
of benefits are deferred until the participant reaches age 65 or terminates as a
director.
10
<PAGE> 14
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION.
The compensation committee of the Regions Board consisted in 1998 of Mr.
Brewer, Ms. Blair, and Mr. Styslinger. In reaching compensation decisions
concerning executive officers other than Mr. Jones, the chief executive officer,
the committee took into account discussions with and recommendations by Mr.
Jones and Regions' senior personnel officer. There is no other involvement by
Regions' executive personnel in the committee's deliberations. Mr. Jones did not
participate in deliberations and decisions regarding his own compensation.
COMPENSATION COMMITTEE EXECUTIVE COMPENSATION REPORT
Set forth below is the Executive Compensation Committee Report of the
Compensation Committee.
EXECUTIVE COMPENSATION REPORT
General. Under the direct control of the compensation committee of the
Regions Board, Regions has developed and installed compensation policies, plans,
and procedures that seek to enhance the profitability of Regions. Stockholder
value is aligned with the financial interests of Regions' senior managers as
financial goals are set for each year. Regions recognizes the importance of
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 reflect corporate, strategic business unit, and
individual performance levels that encourage an explicit and continuing focus on
increasing profitability and stockholder value.
The committee's methodology and approach incorporate both qualitative and
quantitative considerations, which are reflected in the committee's
determinations concerning executive compensation and the specific components
thereof. In particular, the total compensation of the executive officers of
Regions can be divided into the categories of (i) annual base salary, (ii)
annual incentive compensation, and (iii) long-term incentive compensation. In
general, and as set forth in greater detail below, annual base salary is
intended to be comparable with executive base compensation paid by other similar
financial institutions; annual incentive compensation is intended to be tied
quantitatively to the achievement by Regions of pre-determined, objective
financial performance goals; and share-based grants for long-term incentive
compensation are intended to reward the executive recipients with incremental
value commensurate with long-term increases in value of Regions Common Stock.
The compensation decisions of the committee relative to Regions' principal
executive officers, including the five officers named above in the compensation
tables, are described below as to each of the three categories.
Base Salary. Annual base salaries are generally set at competitive levels
with similar financial institutions. Specifically the committee considers peer
group comparisons from survey data for other financial companies,
recommendations from an independent compensation consultant, and individual
performance assessments. For executives other than the chief executive officer,
the committee also considers the chief executive officer's recommendations.
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 reach a
consensus and the committee sets a base salary level for each executive.
In evaluating and establishing the base salaries of the executive officers,
the committee, in conjunction with its independent compensation consultant,
surveys the base salaries of the corresponding officers of other bank holding
companies in a survey group consisting of approximately 20 companies closest to
Regions in asset size and deposit size, and also including the three other
largest bank holding companies headquartered in Alabama. The committee attempts
to establish the base salaries of the named executive officers such that the
aggregate of their base salaries is targeted to the median point of the
aggregate of the base salaries of the corresponding executive officers of the
companies in the survey group, based on the most recent information available.
Based on year end 1996 information, the information most recently available, the
aggregate of the actual base salaries of Regions named executive officers group
approximated such survey median point.
11
<PAGE> 15
It should be noted that the survey comparison group is not the same as the
group of companies which make up the NASDAQ Banks Index presented in the
Comparison of Five-year Cumulative Total Return graph included in this Proxy
Statement. The committee believes the use of a smaller survey group tailored by
asset and deposit size is more valid for salary evaluation purposes, even though
not all the survey companies are included in the indices, and even though
numerous companies included in the indices are not included in the survey group.
Based on the survey comparison, advice of an independent compensation
consultant, recommendations from the chief executive officer, and an inherently
subjective assessment of the comparative contributions of the executive
personnel to Regions' continued financial and operating success, the 1998 base
salaries for the other named officers were determined by the committee.
Annual Incentive Compensation. In the first quarter of 1998, the
compensation committee approved Regions' 1998 annual performance goals, as
prepared by Regions' comptroller, and as used for the purpose of determining
potential annual incentive compensation for the executive officers. The
performance goals were quantitative in nature, resulting in an incentive plan
formula that was weighted towards their overall importance in attaining Regions'
annual profit plan, and focused on the accomplishment of financial objectives,
before certain nonrecurring items, in the areas of: Net Income Before Securities
Transactions, Return on Assets, Return on Equity, Efficiency Ratio; Average Loan
Growth (exclusive of acquisition related growth); Average Core Deposit Growth
(exclusive of acquisition related growth); Open/Closed Accounts Ratio, and
Employee Turnover Ratio. With record earnings in 1998, Regions exceeded maximum
levels in four company-wide performance goals, exceeded target levels in two,
and exceeded threshold level in one. Regions exceeded target performance in all
regional business unit 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 1998 base salary levels.
Long Term Incentive Compensation. During 1998, the compensation committee
evaluated the merits of granting the chief executive officer, the named officers
and other key employees, further awards under Regions' 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 compensation
committee placed relatively more reliance on the advice of Regions' 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
Regions. The committee further believes that its initial 1991 awards under the
LTIP successfully focused and committed Regions' management on building
profitability and stockholder value. The primary purpose of LTIP awards is to
encourage management members to take long-term steps to achieve and sustain
Earnings Per Share and Return on Equity objectives. Accordingly, the committee
further awarded LTIP grants during 1998.
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 the participants. The committee also took into account the number
and size of LTIP awards and stock options already held by executive officers
considered for additional awards.
Compensation of Chief Executive Officer. In deliberating the compensation
of the Chief Executive Officer, the committee adheres to the same basic
methodology and approach applied to executive compensation generally.
Accordingly, the base salary determination reflects the peer group survey
comparison described above, the annual incentive compensation is based on an
objective formula and tied to Regions' achievement of pre-determined,
quantitative financial goals, and the realization of long-term incentive
compensation, by its nature, is aligned with the realization of long-term
stockholder value.
In addition, the committee, in deliberating the chief executive officer's
compensation, takes into account other factors. For example, the committee gave
special consideration to the facts that Mr. Jones had received a substantial
base salary increase in 1997 when he was elevated from regional president to
chief operating officer, and that Mr. Jones' promotion to chief executive
officer at the beginning of 1998, with the additional
12
<PAGE> 16
responsibilities and demands the position involves, would justify another
substantial increase for 1998. In addition, the committee also took note of the
fact that Mr. Jones was new in the position. The committee set Mr. Jones' base
salary for 1998 at a level it concluded would be appropriate in light of the
circumstances the committee considered, while recognizing that his base salary
would be in the low end of the range of salaries of chief executives of
comparable bank holding companies.
LTIP awards for Mr. Jones 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 desire to set appropriate long-term performance objectives
commensurate with Mr. Jones promotion to chief executive officer.
Summary. The compensation committee of the board of directors remains
dedicated to ensuring that Regions' 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 Regions'
marketplace;
- Link annual incentive awards with specific performance targets that yield
superior results; and
- Provide long-term incentive awards that couple management ownership with
stockholder value.
Section 162(m) of the Code imposes certain limitations on the deductibility
by Regions for federal income tax purposes of compensation amounts paid to
highly paid executives. The committee is aware of the potential effects of
Section 162(m) of the Code. The committee has concluded that ensuring
deductibility under Section 162(m) is not as important as structuring incentive
compensation based on methodology and factors it deems appropriate. The
committee has chosen not to distort its methodology and application of the
factors it believes pertinent so as to ensure that all executive compensation is
deductible under Section 162(m). While the committee intends that Regions'
compensation plans will meet, to the extent practical, the prerequisites for
deductibility under Section 162(m), if it develops that a portion of the
compensation of one or more executive officers is not deductible under Section
162(m), then the committee expects that Regions would honor its obligations to
the executive officers under the compensation arrangements approved by the
committee.
The compensation 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 Regions' public accounting firm with respect to the proper design
of the program toward achieving Regions' objectives as set forth by the chief
executive officer and the Regions Board.
This report furnished by:
Lee J. Styslinger, Jr., Chairman
Albert P. Brewer
Sheila S. Blair
13
<PAGE> 17
FINANCIAL PERFORMANCE
Set forth below is a graph comparing the yearly percentage change in the
cumulative total return of Regions' common stock against the cumulative total
return of the S&P 500 Index and the NASDAQ Banks Index for the past five years.
This presentation assumes that the value of the investment in Regions' common
stock and in each index was $100 and that all dividends were reinvested.
<TABLE>
<CAPTION>
Measurement Period S&P 500 NASDAQ
(Fiscal Year Covered) Regions Index Bank Index
<S> <C> <C> <C>
12/31/93 100 100 100
12/31/94 99.34 101.37 99.64
12/31/95 142.54 139.51 148.38
12/31/96 176.38 172.01 195.91
12/31/97 293.75 229.60 328.02
12/31/98 287.51 295.72 324.90
</TABLE>
OTHER TRANSACTIONS
Directors and officers of Regions and their associates were customers of,
and had transactions with, the affiliate banks in the ordinary course of
business during 1998; 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.
Regions retained during 1998 and prior years and proposes to retain in the
future on behalf of the Company or certain of its subsidiaries the law firms
Lange, Simpson, Robinson, & Somerville LLP, of which director Henry E. Simpson
is a partner. During 1998, the Company or its subsidiaries paid legal fees of
$1,819,800 to the firm of Lange, Simpson, Robinson & Somerville LLP.
AMENDMENT AND RESTATEMENT OF THE
CERTIFICATE OF INCORPORATION
The Board of Directors has proposed an amendment to the Certificate of
Incorporation, described below, and has adopted a restatement of the Certificate
of Incorporation, as amended, subject to ratification of the restatement by the
stockholders. The board of directors is requesting you to approve the proposed
amendment and to ratify the restatement of the Certificate of Incorporation.
14
<PAGE> 18
In September, 1998, the Board of Directors adopted an amendment to the
bylaws revising the retirement age of directors, to provide that directors of
the Company shall retire immediately before the next annual meeting of
stockholders after reaching age 68 (or 70 in the case of directors who were over
age 68 on the date the bylaw amendment was adopted.) The purpose of the proposed
amendment to the certificate of incorporation is to eliminate any inconsistency
between the certificate of incorporation and the bylaws and thereby clarify that
the retirement of directors is governed by the bylaws, by deleting any reference
to retirement of directors in Article EIGHTH of the certificate of
incorporation.
The board of directors has proposed a restatement of the Certificate of
Incorporation, giving effect to the proposed amendment of Article EIGHTH. The
Delaware General Corporation Law authorizes the board of directors to adopt a
restatement of the Certificate of Incorporation without stockholder approval,
provided that the restatement does not effect any amendment of the then existing
certificate of incorporation. The board of directors is seeking stockholder
ratification of the restatement because Article EIGHTH simultaneously is being
amended, as proposed.
Approval of the proposed amendment and ratification of the restatement of
the Certificate of Incorporation requires the affirmative vote of a majority of
the shares of Regions Common Stock outstanding and entitled to vote at the
Annual Meeting. The board of directors recommends that you vote "FOR" the
proposed amendment and adoption of the restatement of the Certificate of
Incorporation, under Item 2 on the proxy card.
A copy of the proposed restated certificate of incorporation is attached to
this proxy statement as Appendix A.
PROPOSALS TO APPROVE MANAGEMENT INCENTIVE PLAN
AND 1999 LONG TERM INCENTIVE PLAN
The board of directors is seeking renewed stockholder approval of the
Company's Management Incentive Plan and stockholder approval of the 1999 Long
Term Incentive Plan. Certain information concerning these matters is set forth
below. Copies of the Management Incentive Plan and the 1999 Long Term Incentive
Plan are reproduced as Appendix C and Appendix D, respectively, to this proxy
statement.
The board of directors recommends a vote "FOR" approval of the Management
Incentive Plan under "Item 3" on the proxy card and vote "FOR" approval of the
1999 Long Term Incentive Plan under "Item 4" on the proxy card. The affirmative
vote of the holders of a majority of the outstanding shares of the Company is
required for approval of both the Management Incentive Plan and the 1999 Long
Term Incentive Plan.
MANAGEMENT INCENTIVE PLAN
The Management Incentive Plan is an annual incentive compensation plan
pursuant to which the Company's executive officers and other key personnel may
be paid annual incentive compensation, in addition to their base salaries, based
on achievement of predetermined performance goals. The performance goals may
apply to Company performance, business unit performance, or individual
performance. While the Management Incentive Plan has been in effect since 1985,
and was approved by stockholders in 1995, Region is seeking renewed stockholder
approval so that payments by the Company under the Management Incentive Plan can
continue to qualify for deductibility by the Company for federal income tax
purposes. Section 162(m) of the Internal Revenue Code limits, with certain
exceptions, the Company's corporate tax deduction for compensation paid to
certain executive officers of the Company to no more than $1,000,000 per
executive per year, and imposes certain other prerequisites for deductibility of
compensation payments. One of such prerequisites is renewal of stockholder
approval within five years of prior approval when a plan reserves to the
administrators the authority to revise the criteria upon which compensation is
based. Because the Management Incentive Plan confers authority upon the
Committee to revise the criteria for awards under the plan, Regions is
submitting the Management Incentive Plan for renewed stockholder approval.
Because the Company has made commitments to its management personnel under the
plan and because the Board of Directors believes the alignment of annual
incentive compensation with objective performance goals
15
<PAGE> 19
appropriately motivates and rewards Regions' key employees, the Company intends
to keep the Management Incentive Plan in effect whether or not renewed
stockholder approval is obtained.
The performance goals (except for individual performance goals, which are
described below) are quantitative in nature and are determined by the
Compensation Committee (the "Committee") for each calendar year based on the
actual operating performance of the Company or business unit. The plan grants
the Committee discretion to formulate performance goals, which are currently in
the areas of (1) net income before securities transactions, (2) return on
assets, (3) return on equity, (4) efficiency ratio, (5) average loan growth, (6)
average core deposit growth, (7) open/closed accounts ratio, and (8) employee
turnover ratio. The Committee's determination of the performance goals takes
into account recommendations of the executive financial officer and the
comptroller, in the case of Company goals, and also of the responsible regional
president in the case of business unit goals. Each performance goal is
percentage-weighted and the weights for each participant must add to 100%. For
each category of performance goal there is designated a threshold level, a
target level, and a maximum level. Within each category, attainment of less than
the threshold level results in no award for that category, and performance
beyond the maximum level results in no additional award for that category.
The plan grants the Committee discretion to establish tiers of
participation, of which there are presently five. Each participant falls within
one of the tiers based upon such participant's roles and responsibilities and
position with the Company. Attainment of the performance goals for the calendar
year will entitle the participants to an annual incentive payment under the
plan, equal to a designated percentage of the participant's base salary. The
percentage is determined within a range assigned to each tier and depends on the
level of achievement of the performance goals for the calendar year. The
percentage of base compensation awardable for the highest tier ranges from 25%
for threshold performance to 100% for maximum performance; for the second tier
ranges from 17.5% for threshold performance to 70% for maximum performance; for
the third tier ranges from 12.5% for threshold performance to 50% for maximum
performance; and for the fourth tier ranges from 7.5% for threshold performance
to 30% for maximum performance.
Individual performance goals are based on annually established objectives
and such other identified key aspects of performance as may be determined by the
Committee and the participant's superiors to be appropriate. The chief executive
officer, the executive financial officer and the regional presidents may not be
assigned individual performance goals under the Management Incentive Plan.
Rather, payments to such executive officers under the plan are based only on
Company performance goals and business unit performance goals. Moreover, with
respect to such executive officers the Committee has no discretion to increase
the amount of compensation that would be due upon attainment of goals or to
alter the goals for the year to which they relate.
APPROVAL OF THE 1999 LONG TERM INCENTIVE PLAN
The board of directors has adopted the 1999 Long Term Incentive Plan (the
"1999 Plan"), subject to the approval of the stockholders. In the absence of
stockholder approval the 1999 Plan will not take effect.
The 1999 Plan provides generally for the granting of incentive stock-based
awards including incentive stock options, non-qualified stock options, stock
appreciation rights, restricted stock, performance units, and dividend
equivalents, to officers and key employees of the Company. It is intended to be
used over a period of years to assist the Company in attracting, retaining,
motivating and rewarding employees who make a significant contribution to the
Company's long term success, and to encourage employees to acquire and maintain
an equity interest in the Company.
The 1999 Plan is to be administered and interpreted by the Compensation
Committee, which is composed of disinterested directors, that is, directors who
are not employees and who are not eligible to receive benefits under the 1999
Plan and who are "outside directors" within the meaning of applicable Internal
Revenue Service regulations. The board of directors may, without further
approval of the stockholders, suspend, terminate or amend the 1999 Plan.
However, no such action may be taken without stockholder
16
<PAGE> 20
approval which would materially increase the total number of shares of common
stock which may be issued under the 1999 Plan, and no action may be taken
without a recipient's consent which would reduce or impair any rights or
obligations under any then outstanding award under the 1999 Plan.
The 1999 Plan authorizes the granting of incentive stock options and
non-qualified stock options to purchase shares of common stock of the Company.
The closing market price of the common stock of the Company as reporting by the
Nasdaq National Market was $ per share on April , 1999.
No stock options may be granted under the 1999 Plan more than 10 years
after the date the plan was first adopted (March 17, 1999.) The option price per
share of incentive and nonqualified stock options shall not be less than the
fair market value of the common stock at the date of the grant. Options may be
exercised by payment in cash, or in the discretion of the Committee, by delivery
of shares having a market value equal to the option price for or in any
combination of cash and shares. An option may be exercised only subject to such
terms as the Committee may impose at the time the option is granted. In general,
an option must terminate not later than ten years after the date of the grant.
The aggregate fair market value, determined as of the time an incentive stock
option is granted, of the common stock with respect to which incentive stock
option are exercised for the first time by an individual during any calendar
year, under the 1999 Plan and other stock option plans of the Company, may not
exceed $100,000.
Stock appreciation rights may be granted under the 1999 Plan in connection
with all or any part of incentive stock options or non-qualified options, or
independent of stock options. Stock appreciation rights permit the recipient to
receive from the Company an amount determinable in relation to any increase in
fair market value of the Company's common stock. The amount awardable upon
exercise of a stock appreciation right for each share covered by the exercise is
equal to the difference between the exercise price and the fair market value of
share on the date of exercise. In the discretion of the committee stock
appreciation rights may be granted in tandem with stock options or independent
of stock options. The committee has the discretion to establish the terms of a
stock appreciation right award at the time of grant, including the method of
exercise, method of settlement, form of consideration payable in settlement, and
any other terms and conditions of the award. Any stock appreciation right award
and the terms and conditions thereof must be evidenced by an award agreement
between Regions and the recipient.
The Company understands the federal income tax consequences of stock
options and stock appreciation rights under the 1999 Plan, under existing
federal income tax laws and regulations to be as follows:
Holders of incentive stock options will not recognize taxable income
as a result of the exercise of such options (except to the extent of taxes
imposed under the alternative minimum tax), and will not recognize taxable
income upon the grant of such options. The amount by which the fair market
value of the stock at the time of the exercise exceeds the option price is
treated as a preference item subject to the alternative minimum tax.
The tax consequences upon disposition of stock acquired by exercise of
an incentive stock option depends upon when the disposition occurs. If the
optionee holds the stock received through exercise of an incentive stock
option for at least two years after the date the option was granted and for
at least one year after the stock was transferred to him, then any gain or
loss recognized on the disposition of the stock will be long term capital
gain or loss equal to the difference between the amount realized upon sale
and the option price. The Company will not be entitled to any tax deduction
in connection with the grant or exercise of incentive stock options
provided that the stock acquired through exercise of the option is not
disposed of within the two year or one year periods described above.
However, if stock acquired through exercise of an incentive stock option is
disposed of within the two year or one year periods described above, then
the excess, if any, of the fair market value of such stock over the option
price will be treated as compensation income to the optionee in the year in
which such disposition occurred, and the Company will be entitled to a like
income tax deduction in that year.
The holder of a non-qualified option, upon exercise, must include an
ordinary income subject to federal taxation an amount equal to the excess
of the fair market value of the stock acquired at date of exercise over the
option price.
17
<PAGE> 21
The recipient of stock appreciation rights will not be subject to
federal income tax at the time of receipt. However, stock or cash delivered
pursuant to the exercise of such rights will be treated as taxable income
to the employee in the year of receipt.
A restricted stock award under the 1999 Plan consists generally of a grant
or sale of the Company's common stock to the recipient subject to conditions
determined by the Committee. The terms determinable by the Committee in each
restricted stock award include the number of shares, the price, if any, to be
paid by the recipient, the time within which the award may be subject to
forfeiture, the nature of the restrictions, including performance criteria if
any, and the circumstances upon which restrictions will lapse. The recipient of
restricted stock may not sell or transfer such shares during the restriction
period, and the certificates representing such shares remain in the custody of
the Company until the conditions of restriction are satisfied. Upon lapse or
removal of the restrictions, the recipient will receive a stock certificate and
will have unrestricted ownership of the covered shares.
The 1999 Plan also provides for the grant of awards in the form of
performance units. The Committee selects recipients of performance unit awards
and establishes performance objectives, the performance period, and the amount
and form of the award. The performance objectives may relate to the specific
performance of the recipient, or the performance of the region, subsidiary, unit
bank, department or function within which the recipient is employed. Performance
objectives are intended to enhance the long term financial condition or
operational objectives of the Company. If at the end of the performance period
the performance objectives have been satisfied, the recipient will have earned
the award. If the specific performance objectives are exceeded, the Committee in
its discretion may award a multiple of the target award, and if the performance
objectives are satisfied in part, the Committee in its discretion may grant the
recipient a portion of the performance award.
The 1999 Plan provides for the grant of awards in the form of dividend
equivalents. Generally, a dividend equivalent entitles the recipient to receive
an amount equivalent to the cash dividends declared on Regions common stock over
a specified period. The committee has the discretion to set the terms and
conditions of a dividend equivalent award at the time of grant, including the
number of shares referable to the award, the time period, the form of
consideration in which an award is to be settled, and the method of settlement.
The 1999 Plan also grants to the committee discretion to make stock-based
awards in other forms and to establish the terms and conditions of the award at
the time of grant. In general, any other form of stock-based award under the
1999 Plan will be payable in, valued in whole or in part by reference to, or be
otherwise based on or related to common stock of the Company. Any such award
must be determined by the committee to be consistent with the purposes of the
1999 Plan.
With respect to any or all awards under the 1999 Plan, the committee may
accelerate the award, meaning that the committee may determine that outstanding
options, stock appreciation rights, and other awards in the nature of rights
that may be exercised shall become fully exercisable and all restrictions on
outstanding awards shall lapse. Such acceleration is automatic without any
action by the committee upon the occurrence of a change in control of Regions
(as defined in the 1999 Plan to exclude certain merger-of-equals transactions),
unless in the opinion of Regions' accountants acceleration would preclude
pooling-of-interests accounting treatment. In exercising its discretion to
accelerate awards under the plan, the committee may distinguish among recipients
and among awards.
If an award is accelerated under by virtue of a change in control, the
committee may, in its sole discretion, provide that the award will expire after
a designated period of time after such acceleration to the extent not then
exercised, that the award will be settled in cash rather than stock, that the
award will be assumed by another party to the transaction giving rise to the
acceleration, or any combination of the foregoing.
In addition to the 1999 Plan, Regions has previously adopted other
incentive based compensation plans, including the 1983 Stock Option Plan, the
1988 Stock Option Plan, and the 1991 Long Term Incentive Plan. The 1999 Plan is
similar in scope and operation to the 1991 Long Term Incentive Plan. No further
awards can be made under the 1983 and 1988 plans.
18
<PAGE> 22
PLAN BENEFITS
The following table sets forth certain information for the calendar year
1998 concerning the amounts paid under the Management Incentive Plan and awards
granted under the 1991 Long Term Incentive Plan to the five executive officers
named under the summary compensation table above, the executive officers of the
Company as a group, and other participating officers and employees as a group.
No awards were made in 1998 under the 1983 and 1988 stock option plans.
PLAN BENEFITS
<TABLE>
<CAPTION>
MANAGEMENT INCENTIVE LONG-TERM INCENTIVE
PLAN PLAN
-------------------- ----------------------
DOLLAR DOLLAR NUMBER
NAME AND POSITION AMOUNT($) AMOUNTS($) OF UNITS
- - ----------------- -------------------- ---------- --------
<S> <C> <C> <C>
J. Stanley Mackin, Chairman.......................... $ 0 $ 0 0(2)
0(3)
Carl E. Jones, Jr., President and.................... 356,175 285,034(1) 33,750(2)
Chief Executive Officer............................ 11,250(3)
Richard D. Horsley, Vice Chairman and................ 149,427 222,047(1) 26,250(2)
Executive Financial Officer........................ 8,750(3)
William E. Jordan, Regional President................ 141,347 222,047(1) 26,250(2)
8,750(3)
Sam P. Faucett, Regional President................... 138,212 222,047(1) 26,250(2)
8,750(3)
Other Executive Officers as a Group (9 persons)...... 763,055 1,683,076(1) 200,000(2)
55,000(3)
66,465(4)
Other Officers and Employees as a Group (5).......... 4,023,581 7,055,161(1) 837,757(2)
222,643(3)
134,041(4)
</TABLE>
- - ---------------
(1) Represents the estimated value at the date of grant of stock options awarded
in 1998, using the Black Scholes option pricing model and the assumptions
identified on page 9 above in note (1) to the stock option grant table.
(2) Represents the number of shares of Regions' common stock underlying stock
options granted in 1998.
(3) Represents the number of performance shares awarded in 1998. It is not
practical to estimate the 1998 dollar value of such awards.
(4) Represents the number of restricted shares awarded in 1998. It is not
practical to estimate the 1998 dollar value of such awards.
(5) 176 persons as to the Management Incentive Plan and 372 persons as to the
Long-Term Incentive Plan.
INDEPENDENT AUDITORS
The audit committee has selected the accounting firm of Ernst & Young LLP
to serve as the principal auditors for the Company for the current year. The
firm of Ernst & Young LLP also served as Regions' principal auditor during 1998.
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.
PROPOSALS OF STOCKHOLDERS
Proposals by stockholders intended to be presented at Regions 2000 annual
meeting of stockholders must be received by Regions not later than December 9,
1999, for consideration for possible inclusion in the proxy statement relating
to that meeting.
19
<PAGE> 23
OTHER BUSINESS
Regions 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
Samuel E. Upchurch, Jr.
Corporate Secretary
Dated April 7, 1999
20
<PAGE> 24
APPENDIX A
RESTATED CERTIFICATE OF INCORPORATION
OF
REGIONS FINANCIAL CORPORATION
First. The name of the corporation is Regions Financial Corporation.
Second. The address of its registered office in the State of Delaware is
No. 100 West Tenth Street, in the City of Wilmington, County of New Castle. The
name of its registered agent at such address is The Corporation Trust Company.
The principal office of the corporation shall be in the State of Alabama and
shall be located in the City of Birmingham, County of Jefferson. Directors'
meetings (unless from time to time specifically otherwise ordered by the Board
of Directors) and appropriate corporate functions shall be held in Birmingham.
The chief executive officer may, for his convenience, in discharging his duties,
locate at whatever place he deems desirable the necessary secretariat and
personal assistants for the efficient operation of his office. 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. Specialized personnel, such as auditors, examiners,
public relation officers, etc., shall be located in such cities as the Directors
may from time to time order.
Third. The purpose of the corporation is to engage in any lawful act or
activity for which corporations may be organized under the General Corporation
Law of Delaware. Without limiting in any manner the scope and generality of the
foregoing, the corporation shall have the following purposes and powers:
(1) To engage generally in the business of owning stock in other
corporations which are engaged in the business of banking in all its
branches and to transact and do all matters and things incidental thereto
or which may at any time hereafter or at any place where the company shall
carry on the business, be usual in connection with the business of banking
or dealing in money or securities.
(2) To acquire by purchase, subscription or otherwise, and to receive,
hold, own guarantee, sell, assign, exchange, transfer, mortgage, pledge, or
otherwise dispose of or deal in and with any and all securities, as such
term is hereinafter defined, issued or created by any corporation, firm
organization, association or other entity, public or private, whether
formed under the laws of the United States of America or of any state,
commonwealth, territory, dependency or possession thereof, or of any
foreign country or of any political subdivision, territory, dependency,
possession or municipality thereof, or issued or created by the United
States of America or any state or commonwealth thereof or any foreign
country, or by any agency, subdivision, territory, dependency, possession
or municipality of any of the foregoing, and as owner thereof to possess
and exercise all the rights, powers and privileges of ownership, including
the right to execute consents and vote thereon.
The term "securities" as used in this Certificate of Incorporation
shall mean any and all notes, stocks, treasury stocks, bonds, debentures,
evidences of indebtedness, certificates of interest of participation in any
profit-sharing agreement, collateral- trust certificates, pre-organization
certificates or subscriptions, transferable shares, investment contracts,
voting trust certificates, certificates of deposit for a security,
fractional undivided interests in oil, gas or other mineral rights, or, in
general, any interests or instruments commonly known as "securities," or
any and all certificates of interest or participation in, temporary or
interim certificates for, receipts for, guaranties of, or warrants or
rights to subscribe to or purchase, any of the foregoing.
(3) To make, establish and maintain investments in securities, and to
supervise and manage such investments.
(4) To cause to be organized under the laws of the United States of
America or of any state, commonwealth, territory, dependency or possession
thereof, or of any foreign country or of any political subdivision,
territory, dependency, possession or municipality thereof, one or more
corporations, firms,
A-1
<PAGE> 25
organizations, associations or other entities and to cause the same to be
dissolved, wound up, liquidated, merges or consolidated.
(5) To acquire by purchase or exchange, or by transfer to or by merger
or consolidation with the corporation or any corporation, firm,
organization, association or other entity owned or controlled, directly or
indirectly, by the corporation, or to otherwise acquire, the whole or any
part of the business, good will, rights, or other assets of any
corporation, firm, organization, association or other entity, and to
undertake or assume in connection therewith the whole or any part of the
liabilities and obligations thereof, to effect any such acquisition in
whole or in part by delivery of cash or other property, including
securities issued by the corporation, or by any other lawful means.
(6) To make loans and give other forms of credit, with or without
security, and to negotiate and made contracts and agreements in connection
therewith.
(7) To aid by loan, subsidy, guaranty or in any other lawful manner
any corporation, firm, organization, association or other entity of which
any securities are in any manner directly or indirectly held by the
corporation or in which the corporation or any such corporation, firm,
organization, association or entity may be or become otherwise interested;
to guarantee the payment of dividends on any stock issued by any such
corporation, firm, organization, association or entity; to guarantee or,
with or without recourse against any such corporation, firm, organization,
association or entity, to assume the payment of the principal of, or the
interest on, any obligations issues or incurred by such corporation, firm,
organization, association or entity; to do any and all other acts and
things for the enhancement, protection or preservation of any securities
which are in any manner, directly or indirectly, held, guaranteed or
assumed by the corporation, and to do any and all acts and things designed
to accomplish any such purpose.
(8) To borrow money for any business, object or purpose of the
corporation from time to time, without limit as to amount; to issue any
kind of indebtedness, whether or not in connection with borrowing money,
including evidences of indebtedness convertible into stock of the
corporation, to secure the payment of any evidence of indebtedness by the
creation of any interest in any of the property or rights of the
corporation, whether at that time owned or thereafter acquired.
(9) To render service, assistance, counsel and advice to, and to act
as representative or agent in any capacity (whether managing, operating,
financial, purchasing, selling, advertising or otherwise) of, any
corporation, firm, organization, association or other entity.
The purposes and powers specified in the foregoing paragraphs shall,
except where otherwise expressed, be in no wise limited or restricted by
reference to, or inference from the terms of any other paragraph in this
Certificate of Incorporation, but the purposes and powers specified in each
of the foregoing paragraphs of this Article shall be regarded as
independent purposes and powers.
The corporation shall possess and may exercise all powers and
privileges necessary or convenient to effect any or all of the foregoing
purposes, or to further any or all of the foregoing powers, and the
enumeration herein of any specific purposes or powers shall not be held to
limit or restrict in any manner exercise by the corporation of the general
powers now or hereafter conferred by the laws of the State of Delaware upon
corporations formed under the General Corporation Law of Delaware.
Fourth. The total number of shares of all classes of stock which the
Corporation shall have the authority to issue is Five Hundred Five Million
(505,000,000) of which Five Hundred Million (500,000,000) shares are to be
common stock (hereinafter called the "Common Stock"), of a par value of
sixty-two and one half cents ($.625) each, and Five Million (5,000,000) shares
are to be Preferred Stock (hereinafter called the "Preferred Stock") of the par
value of one dollar ($1) each.
(1) Authority is hereby expressly granted to the Board of Directors from
time to time to issue the Preferred Stock, for such consideration and on such
terms as it may determine, as Preferred Stock of one or more series and in
connection with the creation of any such series to fix by the resolution or
resolutions providing for the issue of shares thereof the designation, powers
and relative participating, optional, or other
A-2
<PAGE> 26
special rights of such series, and the qualifications, limitations, or
restrictions thereof. Such authority of the Board of Directors with respect to
each such series shall include, but not be limited to, the determination of the
following:
(a) the distinctive designation of, and the number of shares
comprising, such series, which number may be increased (except where
otherwise provided by the Board of Directors in creating such series) or
decreased (but not below the number of shares thereof then outstanding)
from time to time by like action of the Board of Directors;
(b) the dividend rate or amount for such series, the conditions and
dates upon which such dividends shall be payable, the relation which such
dividends shall bear to the dividends payable on any other class or classes
or any other series of any class or classes of stock, and whether such
dividends shall be cumulative, and if so, from which date or dates for such
series;
(c) whether or not the shares of such series shall be subject to
redemption by the Corporation and the time, prices, and other terms and
conditions of such redemption;
(d) whether or not the shares of such series shall be subject to the
operation of a sinking fund or purchase fund to be applied to the
redemption or purchase of such shares and if such a fund be established,
the amount thereof and the terms and provisions relative to the application
thereof;
(e) whether or not the shares of such series shall be convertible into
or exchangeable for shares of any other class or classes, or of any other
series of any class or classes, of stock of the Corporation and if
provision be made for conversion or exchange, the times, prices, rates,
adjustments, and other terms and conditions of such conversion or exchange;
(f) whether or not the shares of such series shall have voting rights,
in addition to the voting rights provided by law, and if they are to have
such additional voting rights, the extent thereof, provided that the
holders of shares of the Preferred Stock will not be entitled to more than
the lesser of: (i) one vote per $100 liquidation value or (ii) one vote per
share, when voting as a class with the holders of the shares of Common
Stock, and will not be entitled to vote separately as a class except where
the Preferred Stock is adversely affected or for the election of directors
after default in the payment of dividends on Preferred Stock;
(g) the rights of the shares of such series in the event of any
liquidation, dissolution, or winding up of the Corporation or upon any
distribution of its assets; and
(h) any other powers, preferences, and relative, participating,
optional, or other special rights of the shares of such series, and the
qualifications, limitations or restrictions thereof, to the full extent now
or hereafter permitted by law and not inconsistent with the provisions
hereof.
(2) Authority is hereby expressly granted to the Board of Directors from
time to time to issue any authorized but unissued shares of Common Stock for
such consideration and on such terms as it may determine.
(3) All shares of any one series of Preferred Stock shall be identical in
all respects except as to the dates from which dividends thereon may be
cumulative. All series of the Preferred Stock shall rank equally and be
identical in all respects except as otherwise provided in the resolution or
resolutions providing for the issue of any series of Preferred Stock.
(4) Whenever dividends upon the Preferred Stock at the time outstanding, to
the extent of the preference to which such stock is entitled, shall have been
paid in full or declared and set apart for payment for all past dividend
periods, and after the provisions for any sinking or purchase fund or funds for
any series of Preferred Stock shall have been complied with, the Board of
Directors may declare and pay dividends on the Common Stock, payable in cash,
stock or otherwise, and the holders of shares of Preferred Stock shall not be
entitled to share therein, subject to the provisions of the resolution or
resolutions creating any series of Preferred Stock.
A-3
<PAGE> 27
(5) In the event of any liquidation, dissolution, or winding up of the
Corporation or upon the distribution of the assets of the Corporation or upon
the distribution of the assets of the Corporation remaining, after the payment
to the holders of the Preferred Stock of the full preferential amounts to which
they shall be entitled as provided in the resolution or resolutions creating any
series thereof, the remaining assets of the Corporation shall be divided and
distributed among the holders of the Common Stock ratably, except as may
otherwise be provided in any such resolution or resolutions. Neither the merger
or consolidation of the Corporation with another corporation nor the sale or
lease of all or substantially all the assets of the Corporation shall be deemed
to be a liquidation, dissolution, or winding up of the Corporation or a
distribution of its assets.
(6) Except as otherwise required by law or provided by a resolution or
resolutions of the Board of Directors creating any series of Preferred Stock,
the holders of Common Stock shall have the exclusive power to vote and shall
have one vote in respect of each share of such stock held by them and the
holders of Preferred Stock shall have no voting power whatsoever. Except as
otherwise provided in such a resolution or resolutions, the number of authorized
shares of the Preferred Stock may be increased or decreased by the affirmative
vote of the holders of a majority of the outstanding shares of capital stock of
the Corporation entitled to vote.
(7) No holder of Preferred Stock or Common Stock of the Corporation shall
have any preemptive right as such holder (other than such right, if any, as the
Board of Directors in its discretion may by resolution, determine pursuant to
this Article Fourth) to purchase, subscribe for or otherwise acquire any shares
of stock of the Corporation of any class now or hereafter authorized, or any
securities convertible into or exchangeable for any such shares, or any warrants
or any instruments evidencing rights or options to subscribe for, purchase or
otherwise acquire any such shares, whether such shares, securities, warrants or
other instruments are now, or shall hereafter be, authorized, unissued or issued
and thereafter acquired by the Corporation.
Fifth. The name and mailing address of each incorporator is as follows:
<TABLE>
<CAPTION>
NAME MAILING ADDRESS
- - ---- ---------------
<S> <C>
Sibyl A. Garrett................... P.O. Box 668, Montgomery, Alabama
Linda V. Neill..................... P.O. Box 668, Montgomery, Alabama
Mary E. Lee........................ P.O. Box 668, Montgomery, Alabama
</TABLE>
Sixth. The corporation is to have perpetual existence.
Seventh. In furtherance and not in limitation of the powers conferred by
statute, the Board of Directors is expressly authorized.
(1) To make, alter or repeal the by-laws of the corporation.
(2) To authorize and cause to be executed mortgages and liens upon the real
and personal property of the corporation.
(3) To declare such lawful dividends, either in cash or stock of the
corporation, as in its discretion it may deem advisable.
(4) To set apart out of any of the funds of the corporation available for
dividends a reserve or reserves for any proper purposes and to abolish any such
reserve in the manner in which it was created.
(5) To fix the number of Directors which shall constitute the whole Board,
subject to the following:
(a) The number of Directors constituting the entire Board shall be
fixed from time to time by vote of a majority of the entire Board,
provided, however, that the number of Directors shall not be reduced so as
to shorten the term of an Director at the time in office, and provided
further, that the number of Directors constituting the entire Board shall
be 21 until otherwise fixed by a majority of the entire Board, and shall
not be less than three. Each Director shall be the record owner of one or
more shares of common stock of the corporation.
(b) The Board of Directors shall be divided into three classes, as
nearly equal in numbers as the then total number of Directors constituting
the entire Board permits with the term of office of one class
A-4
<PAGE> 28
expiring each year. At the annual meeting of stockholders in 1982,
Directors of the first class shall be elected to hold office for a term
expiring at the next succeeding annual meeting, Directors of the second
class shall be elected to hold office for a term expiring at the second
succeeding annual meeting and Directors of the third class shall be elected
to hold office for a term expiring at the third succeeding annual meeting.
Any vacancies in the Board of Directors for any reason, and any created
directorships resulting from any increase in the number of Directors may be
filled by the Board of Directors, acting by a majority of the Directors
then in office, although less than a quorum, and any directors so chosen
shall hold office until the next election of the class for which such
Directors shall have been chosen and until their successors shall be
elected and qualified. No decrease in the number of Directors shall shorten
the term of any incumbent Director. Subject to the foregoing, at each
annual meeting of stockholders the successors to the class of Directors
whose term shall then expire shall be elected to hold office for a term
expiring at the third succeeding annual meeting.
(c) Notwithstanding any other provisions of this certificate of
incorporation or the by-laws of the corporation (and notwithstanding the
fact that some lesser percentage may be specified by law, this certificate
of incorporation or the by-laws of the corporation), any Director or the
entire Board of Directors of the corporation may be removed at any time,
but only for cause and only by the affirmative vote of the holders of 75%
or more of the outstanding shares of capital stock of the corporation
entitled to vote generally in the election of directors (considered for
this purpose as one class) cast at a meeting of the stockholders called for
that purpose.
(d) Nominations for the election of Directors may be made by the Board
of Directors or by any stockholder entitled to vote for the election of
Directors. Such nominations shall be made by notice in writing, delivered
or mailed by first class United States Mail, postage prepaid, to the
Secretary of the corporation not less than 14 days nor more than 50 days
prior to any meeting of the stockholders called for the election of
Directors; provided, however, that if less than 21 days' notice of the
meeting is given to stockholders, such written notice shall be delivered or
mailed, as prescribed, to the Secretary of the corporation not later than
the close of the seventh day following the day on which notice of the
meeting was mailed to stockholders. Notice of nominations which are
proposed by the Board of Directors shall be given by the Chairman on behalf
of the Board.
(e) Each notice under subsection (d) shall set forth (i) the name,
age, business address and, if known, residence address of each nominee
proposed in such notice, (ii) the principal occupation or employment of
each such nominee and (iii) the number of shares of stock of the
corporation beneficially owned by each such nominee.
(f) The Chairman of the meeting may, if the facts warrant, determine
and declare to the meeting that a nomination was not made in accordance
with the foregoing procedure, and if he should so determine, he shall so
declare to the meeting and the defective nomination shall be disregarded.
(6) By a majority of the whole Board, to designate one or more committees,
each committee to consist of two or more of the Directors of the corporation.
The Board may designate one or more Directors as alternate members of any
committee, who may replace any absent or disqualified member or any meeting of
the committee. Any such committee, to the extent provided in the resolution or
in the by-laws of the corporation, shall have and may exercise the powers 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 which may require it; provided, however, the by-laws may provide that in
the absence or disqualification of any member of such committee or committees,
the member or members thereof present at any meeting and not disqualified from
voting, whether or not he or they constitute a quorum, may unanimously appoint
another member of the Board of Directors to act at the meeting in the place of
any such absent or disqualified member.
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(7) (a) Except as set forth in Clause (d) of this paragraph (7) of Article
Seventh the affirmative vote of the holders of at lease 75% of the outstanding
shares of the corporation entitled to vote in election of Directors shall be
required to effect or validate:
(1) any merger or consolidation with or into any other corporation, or
(2) any sale or lease of all or a substantial part of the assets of
the corporation to any other corporation, person or other entity, if as of
the record date for determination of stockholders entitled to notice
thereof and to vote thereon, such other corporation, person or entity which
is party to such a transaction is the beneficial owner, directly or
indirectly, of 5% or more of the outstanding shares of the corporation
entitled to vote in elections of directors. Such affirmative vote shall be
in addition to any vote of the holders of the shares of the corporation
otherwise required by law, this certificate of incorporation or any
agreement between the corporation and any national securities exchange.
(b) For purpose of this paragraph (7) any corporation, person or other
entity shall be deemed to be the beneficial owner of any shares of the
corporation:
(1) which it owns directly, whether not of record, or
(2) which it has the right to acquire pursuant to any agreement or
understanding or upon exercise of conversion rights, warrants or options or
otherwise, or
(3) which are beneficially owned, directly or indirectly (including
shares deemed to be owned through application of clause (2) above), by an
"affiliate" or "associate" as those terms are defined in Rule 12b-2 of the
General Rules and Regulations under the Securities Exchange Act of 1934 as
in effect on May 1, 1977, or
(4) which are beneficially owned, directly or indirectly (including
shares deemed owned through application of clause (2) above), by any other
corporation, person or entity with which it or its "affiliate" or
"associate" has any agreement or arrangement or understanding for the
purpose of acquiring, holding, voting or disposing of shares of the
corporation. For the purpose of determining whether a corporation, person
or entity is the beneficial owner of one or more of the outstanding shares
of the corporation, the outstanding shares of the corporation shall include
shares not in fact outstanding but deemed owned through the application of
clauses (b)(2), (3) and (4) above, but shall not include any other shares
which may be issuable pursuant to any agreement or upon exercise of
conversion rights, warrants or options or otherwise.
(c) The Board of Directors shall have the power and duty to determine for
the purposes of this paragraph (7), on the basis of information known to the
corporation whether:
(1) such other corporation or other entity beneficially owns more than
5% of the outstanding shares of the corporation entitled to vote in
elections of Directors;
(2) a corporation, person, or entity is an "affiliate" or "associate"
(as defined in paragraph (b) above) of another;
(3) the memorandum of understanding referred to in clause (d) below is
substantially consistent with the transaction covered thereby.
Any such determination shall be conclusive and binding for all
purposes of this paragraph (7).
(d) The provisions of this paragraph (7) shall not apply to:
(1) any merger or similar transaction with any corporation if the
Board of Directors of the corporations has approved a memorandum of
understanding with such other corporation with respect to such transaction
prior to the time that such other corporation shall have become the
beneficial owner of more than 5% of the outstanding shares of the
corporation entitled to vote in elections of Directors; or after such
acquisition of 5% of the outstanding shares, if 75% or more of the entire
Board of Directors approve such transaction prior to its consummation; or
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(2) any merger or consolidation of the corporation with, or any sale
or lease to the corporation or any subsidiary thereof of any assets of, or
any sale or lease by the corporation or any subsidiary thereof of any of
its assets to, any corporation of which a majority of the outstanding
shares of all classes of stock entitled to vote in election of Directors is
owned of record or beneficially by the corporation and its subsidiaries.
Eighth. Directors of Subsidiaries. The nomination and election of
Directors of each corporation which is or may in the future be a subsidiary of
the corporation shall be conducted in the manner prescribed in the charter or
by-laws of said subsidiary corporation.
Ninth. No action required to be taken or which may be taken at any annual
or special meeting of stockholders of the corporation may be taken without a
meeting, and the power of stockholders to consent in writing, without a meeting,
to the taking of any action is specifically denied.
Tenth. (1) The corporation shall indemnify its officers directors,
employees and agents to the full extent permitted by the General Corporation Law
of Delaware.
(2) No director of the corporation shall be personally liable to the
corporation or its stockholders for monetary damages, for breach of fiduciary
duty as a director, except for liability (i) for any breach of the director's
duty of loyalty to the corporation or its stockholders; (ii) for acts or
omissions not in good faith or which involve intentional misconduct or a knowing
violation of law; (iii) under Section 174 of the Delaware General Corporation
Law; or (iv) for any transaction from which the director derived an improper
personal benefit.
Eleventh. Whenever a compromise or arrangement is proposed between this
corporation and its creditors or any class of them and/or between this
corporation and its stockholders or any class of them, any court of equitable
jurisdiction within the State of Delaware may, on this application in a summary
way of this corporation or of any creditor or stockholder thereof, or on the
application of any receiver or receivers appointed for this corporation under
the provisions of Section 291 of Title 8 of the Delaware Code or on the
application of trustees in dissolution or of any receiver or receivers appointed
for this corporation under the provisions of Section 279 of Title 8 of the
Delaware Code order a meeting of the creditors or class of creditors, and/or of
the stockholders or class of stockholders of this corporation, as the case may
be, to be summoned in such manner as the said court directs. If a majority in
number representing three-fourths in value of the creditors or class of
creditors, and/or of the stockholders or class of stockholders of this
corporation, as the case may be, agree to any compromise or arrangement and to
any reorganization of this corporation as consequence of such compromise or
arrangement, the said compromise or arrangement and the said application has
been made, be binding on all the creditors or class or creditors, and/or on all
the stockholders or class of stockholders, of this corporation, as the case may
be, and also on this corporation.
Twelfth. Meetings of stockholders may be held within or without the State
of Delaware, as the by-laws may provide. The books of the corporation may be
kept (subject to any provision contained in the statutes) outside the State of
Delaware at such place or places as may be designated from time to time by the
Board of Directors or in the by-laws of the corporation. Special meetings of the
stockholders may be called at any time by the Chief Executive Officer, Secretary
or Board of Directors of the corporation.
Thirteenth. The corporation reserves the right to amend, alter, change or
repeal any provision contained in this certificate of incorporation, in the
manner now or hereafter prescribed by statute, and all rights conferred upon
stockholders herein are granted subject to this reservation.
As provided in Article Seventh, paragraph (1), the Board of Directors is
expressly authorized to make, alter or repeal by- laws of the corporation by a
vote of a majority of the entire Board; and the stockholders may make, alter or
repeal any by-laws whether or not adopted by them, provided however, that any
such additional by-laws, alterations or repeal may be adopted only by the
affirmative vote of the holders of 75% or more of the outstanding shares of
capital stock of the corporation entitled to vote generally in the election of
Directors (considered for this purpose as one class) at a meeting of
stockholders called for such purpose.
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<PAGE> 31
Notwithstanding any other provision of this certificate of incorporation or
the by-laws of the corporation (and in addition to any other vote that may be
required by law, this certificate of incorporation or the by-laws), the
affirmative vote of the holders of at least 75% of the outstanding shares of the
capital stock of the corporation entitled to vote generally in the election of
Directors (considered for this purpose as one class) shall be required to amend,
alter or repeal any provision of Article Fourth; Article Seventh paragraph (5);
Article Seventh paragraph (7); Article Ninth; Article Twelfth; or Article
Thirteenth of the certificate of incorporation.
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<PAGE> 32
APPENDIX B
REGIONS FINANCIAL CORPORATION
MANAGEMENT INCENTIVE PLAN
AMENDED AND RESTATED AS OF JANUARY 1, 1999
I. PURPOSE OF THE PLAN
The purpose of the Plan is to:
A. Optimize the soundness, profitability and growth of Regions
Financial Corporation (the "Company");
B. Promote and encourage excellence in the performance of individual
responsibilities; and
C. Provide an incentive opportunity and ensure appropriate total cash
compensation for those members of management who are positioned to make
significant contributions to the Company's success.
II. PLAN ADMINISTRATION
The Committee shall be responsible for the management and administration of
the Plan. The Committee has full authority to interpret, apply, and administer
the Plan as it may be deemed to be in the best interests of the Company and its
shareholders. The Committee may delegate certain administrative responsibilities
as it deems appropriate to officers of the Company. Any decision by the
Committee relating to the Plan or to awards thereunder shall be final and
binding on the Participants.
III. PARTICIPATION IN THE PLAN
A. The Committee shall, with respect to each Plan Year, determine which
employees of the Company shall participate in the Plan for that Plan Year, based
upon recommendations from the Chairman. Selection of Participants shall be made
from among those senior Company staff members who are deemed to be sufficiently
experienced and capable of making significant contributions to the Company.
Participation is conditional; participation in one Plan Year does not guarantee
participation in successive years. With respect to any employee of the Company
who is a member of the Executive Advisory Council, selection of that employee to
be a Participant shall be made no later than March 31 of the Plan Year to which
participation relates, and shall be made in writing.
B. Participation Tiers
The Committee shall assign all Participants to Participation Tiers on the
basis of their roles and responsibilities and/or Base Compensation grade for the
Plan Year to which participation relates. With respect to any Participant who is
a member of the Executive Advisory Council, assignment of the Participant to a
Participation Tier shall be made no later than March 31 of the Plan Year to
which participation relates, and shall be made in writing.
C. Within each Participation Tier, Participants shall be assigned
performance goals related to corporate, regional, unit and personal goals. With
respect to any Participant who is a member of the Executive Advisory Council,
the Committee's assignment of goals to that Participant shall be made by March
31 of the Plan Year to which the goals relate, and shall be in writing.
D. For each Participation Tier, the Committee shall determine the target
award opportunities that shall apply to Participants in that Participation Tier.
Target award opportunities shall be expressed as a percentage of Base
Compensation. The maximum target award permissible under the Plan shall be 60%.
With respect to any Participant who is a member of the Executive Advisory
Council, the determination of the target award opportunity applicable to that
Participant shall be made by March 31 of the Plan Year to which the target award
applies, and shall be in writing.
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<PAGE> 33
E. Depending upon the extent to which performance goals are met or
exceeded, the actual award opportunities for a Participant shall range from no
award to a maximum of two times the target award opportunity, according to the
provisions of Section IV.
IV. PERFORMANCE CRITERIA AND ANNUAL PLAN THRESHOLD
A. Company performance. The Committee shall establish corporate, regional,
and unit performance goals based on consolidated income before securities
transactions, return on assets, return on equity, average loan growth, deposit
growth, and other quantifiable financial objectives.
B. Personal performance. Personal performance goals shall consist of
annually established objectives and such other identified key aspects of
performance as may be determined to be appropriate for the Participant.
C. Each Plan Year the Committee will establish performance goals that
define the range of performance which the Plan will recognize for the Plan Year
to which the goals relate. With respect to any Participant who is a member of
the Executive Advisory Council, such performance goals shall be in writing and
shall be established before the earlier of (i) the date on which the outcome
under the goals is substantially certain or (ii) March 31 of the Plan Year to
which the goals relate. Corporate performance goals shall be recommended by the
Chairman or Vice Chairman. Regional goals and unit bank goals shall be approved
by the Regional Presidents. Corporate performance goals and regional goals must
also be approved by the Chairman and the Committee. Personal performance goals
shall be established by the Participant's manager and the next higher level of
management, subject to the overall review and approval by the Chairman.
D. If the Participant is a member of the Executive Advisory Council,
Company performance goals and personal performance goals established by the
Committee shall be objective performance goals within the meaning of Section
162(m) of the Internal Revenue Code and treasury regulations promulgated
thereunder. Pursuant to those regulations, a performance goal shall be
considered objective only if a third party having knowledge of the relevant
facts could determine whether the goals have been met. Furthermore, and
notwithstanding any other provision of the Plan to the contrary, once the
Committee has established performance goals for a Participant who is a member of
the Executive Advisory Council, the Committee shall have no discretion to (i)
increase the amount of compensation that would otherwise be due upon the
attainment of the goals or (ii) alter the goals for the Plan Year to which they
relate.
E. Levels of goal achievement shall be characterized as (i) threshold
achievement, below which no award is payable; (ii) target achievement, or; (iii)
maximum achievement, above which no additional award is payable.
F. The Chairman shall recommend, subject to the approval of the Committee,
the threshold, target, and maximum levels of achievement with respect to a Plan
Year. The Chairman shall also recommend, subject to the approval of the
Committee, specific floors and caps on these levels of achievement. With respect
to Participants who are members of the Executive Advisory Council, threshold,
target, and maximum levels shall be established by the Committee, in writing, no
later than March 31 of each Plan Year, and shall remain in effect for the
remainder of the Plan Year.
G. For each Performance Tier, the Committee shall assign weightings to
indicate the relative importance of each criterion in determining incentive
awards earned under the Plan. The sum of weightings assigned to any Participant
must equal 100%. These weightings may vary from Plan Year to Plan Year, and
shall be based on recommendations by the Chairman or Vice Chairman subject to
approval by the Committee. With respect to any Participant who is a member of
the Executive Advisory Council, the Committee shall assign such weightings on or
before March 31 of each Plan Year, and such weightings shall remain in effect
for the remainder of the Plan Year.
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<PAGE> 34
V. PLAN ADMINISTRATOR'S DISCRETION
The Committee, as plan administrator, is authorized to administer the Plan,
subject to and in accordance with the provisions set forth herein, and shall
have all powers necessary and appropriate to enable it to properly administer
the Plan, including but not limited to the power to:
A. approve the establishment and range of corporate goals,
recommendations regarding participation, the amounts of individual award
pay-outs, and all matters relating to the day-to-day operation of the Plan;
B. construe and interpret the Plan, establish rules and regulations,
delegate such administrative responsibilities as it deems proper, and to
perform all other acts it deems necessary to carry out the intent and
purpose of the Plan;
C. modify or amend the terms of the Plan, as it becomes appropriate;
D. cancel the participation of any person who conducts himself in a
manner which the Committee, in the exercise of reasonable discretion,
determines to be inimical to the best interests of the Company;
E. correct any defect, supply any omission, or reconcile any
inconsistency in the Plan, in the manner and to the extent it shall deem
necessary; and,
F. adopt and modify, as needed, guidelines for identifying
Participation Tiers and Performance Criterion, assigning Participants to
Participation Tiers and determining target awards for Participants within
each Participation Tier.
The Committee's determination under the Plan of the persons to participate
and receive awards and the terms and conditions of such awards need not be
uniformly applicable to all Participants, but may be made by the Committee on a
selective basis among persons who receive or are eligible to receive awards
under the Plan, whether or not such persons are similarly situated. The
Committee shall have final approval authority over the payment of all awards
under this Plan, whether individually or collectively.
VI. PLAN FUNDING AND ACCRUALS OF AWARDS
The Plan is unfunded and awards hereunder shall be paid from general
corporate funds.
VII. NEW PARTICIPANTS, PROMOTIONS, OR TRANSFERS
All participation in the Plan is subject to approval by the Committee.
Newly hired or promoted employees who enter positions which are considered to be
eligible for participation in the Plan normally will enter the Plan on January 1
next following the date of hire or promotion. The Chairman, however, subject to
approval by the Committee, may authorize immediate participation upon hire or
promotion. In this event, Participants who enter the Plan during the Plan Year
will receive awards calculated on a pro rata basis using the Base Compensation
earned and levels of performance achieved for that eligible portion of the Plan
Year.
VIII. TERMINATION OF EMPLOYMENT
If a Participant terminates employment during a Plan Year for any reason
other than Retirement, Disability, or death, no award will be payable under the
Plan.
If a Participant's employment terminates during a Plan Year as a result of
Retirement, Disability, or death, the Participant, his Beneficiary, or his
estate will receive a pro-rata portion of the incentive award determined as of
the end of the Plan Year. The proration will be based on the Participant's
year-to-date Base Compensation for the Plan Year and the achieved levels of
performance as of the end of the Plan Year. The pro-rated award will be paid at
the same time as awards are paid to active Participants.
If a Participant's employment terminates between the end of the Plan Year
and the Award Payment Date for any reason other than willful dishonesty or gross
misconduct, the full award earned as of December 31 of
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<PAGE> 35
the Plan Year will be paid. If the Participant's employment is terminated during
this period for willful dishonesty or gross misconduct, no award will be
payable.
IX. MISCELLANEOUS PROVISIONS
A. Nonalienation of benefit. No benefit under the Plan shall be subject in
any manner to anticipation, alienation, sale, transfer, assignment, pledge,
encumbrance or charge, and any attempt to do so shall be void.
B. Withholding of taxes. The Company shall have the right to deduct from
any award payable under this Plan all applicable withholding and employment
taxes at such times as they are due.
C. Establishment of Base Compensation. All awards under the Plan shall be
calculated on Base Compensation earned during the Plan Year.
D. Other benefit plans. No awards, payments, or benefits paid under this
Plan shall be taken into account in determining any benefits under any
retirement, profit-sharing, or other employee benefit plan to which the Company
contributes.
E. Plan expenses. Any expenses incurred in the administration of this Plan
shall be borne by the Company.
F. Right to continued employment. Participation in this Plan shall not be
construed as giving any Participant the right to be retained in the employ of
the Company. Further, the Company expressly reserves the right at any time to
dismiss any Participant with or without cause, such dismissal to be free from
any liability or any claim under the Plan, except as provided herein.
G. Construction of the Plan. The Plan shall be governed and interpreted in
accordance with the laws of the State of Alabama, and shall be binding on and
inure to the benefit of any successor or successors of the Company.
H. Headings. The heading and subheadings in the Plan have been inserted
for convenience and reference only and are not to be used in construing the
instrument or any provisions hereof.
I. Number and gender. The masculine pronoun used shall include the
feminine pronoun and the singular number shall include the plural number unless
the context of the Plan requires otherwise.
J. Power to amend and terminate the Plan. The Committee may, at any time,
without the need for obtaining approval of the shareholders, by an instrument in
writing, suspend or terminate the Plan, in whole or in part, or amend it in such
respects as the Committee, in its sole discretion, deems appropriate and in the
best interests of the Company; provided, however, that shareholder approval
shall be required for any amendment that changes the material terms of the Plan
applicable to any Participant who is a member of the Executive Advisory Council.
X. DEFINITIONS
When used herein, the following words and phrases shall have the meanings
set forth below, unless a different meaning is clearly required by the context
of the Plan.
A. Award Payment Date shall mean the date on which incentive awards are
paid to Participants, which may not be later than March 31 of the year following
the Plan Year.
B. Base Compensation shall mean income provided to the Participant for
services rendered, also referred to as base salary, excluding overtime,
commissions, awards from other incentive programs, Company contributions to
fringe benefit programs (other than pre-tax contributions by employees to plans
maintained under Sections 125 or 401(k) of the Internal Revenue Code), and other
"non-salary" income.
C. Beneficiary shall mean the person or persons designated by the
Participant to receive amounts payable under the Plan in the event of the
Participant's death.
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<PAGE> 36
D. Committee shall mean the Directors Personnel Committee of the Board of
Directors of Regions Financial Corporation.
E. Company shall mean Regions Financial Corporation, its affiliates and
subsidiaries, or any successor(s) thereto.
F. Deferred Award shall mean that portion of an award which is held for
payment at a designated future time in accordance with the provisions of the
Regions Financial Corporation Optional Deferred Compensation Plan for Management
Employees.
G. Disability shall mean a physical or mental condition which renders the
Participant incapable of performing the work for which he was employed or
similar work, as evidenced by eligibility for and actual receipt of benefits
payable under the Company's long-term disability program and/or Social Security.
H. Executive Advisory Council shall mean the management committee of the
Company, the membership of which is determined from time to time by the Chairman
and CEO. As of the date of this amendment and restatement of the Plan,
membership on the Executive Advisory Council consisted of the Chairman and CEO,
the Vice Chairman/Executive Financial Officer, and the Regional Presidents.
I. Participant shall mean any employee who is selected from the ranks of
senior company staff who is selected by the Committee to be a member of the
Plan, based on experience and capability.
J. Participation Tier shall mean the level of participation assigned to
each member of the Plan, based generally on the Participant's roles and
responsibilities and/or Base Compensation, which determines the amount of the
award in terms of a percentage of Base Compensation.
K. Performance Criteria shall mean those specific financial statement items
and personal goals which are determined to be the measurements of performance
success in a given Plan Year.
L. Plan shall mean the Regions Financial Corporation Management Incentive
Plan, as set forth herein or in any amendments hereto.
M. Plan Year shall mean any performance period which begins on January 1
and ends on December 31, i.e., the calendar year.
N. Retirement shall mean the cessation of active employment by a
Participant, whether such cessation is designated as "normal" (at age 65) or
"early" (prior to age 65) retirement under the terms and conditions of the
Regions Financial Corporation Retirement Plan.
IN WITNESS WHEREOF, Regions Financial Corporation has caused this Amended
and Restated Management Incentive Plan to be executed as of this the 1st day of
January, 1999.
REGIONS FINANCIAL CORPORATION
By: /s/ CARL E. JONES, JR.
------------------------------------
Carl E. Jones, Jr.
Its: President
and Chief Executive Officer
ATTEST:
/s/ SAMUEL E. UPCHURCH, JR.
- - ---------------------------------------------------------
Samuel E. Upchurch, Jr.
Its: Corporate Secretary
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<PAGE> 37
APPENDIX C
REGIONS FINANCIAL CORPORATION
1999 LONG-TERM INCENTIVE PLAN
ARTICLE 1
PURPOSE
1.1. General. The purpose of the Regions Financial Corporation 1999
Long-Term Incentive Plan (the "Plan") is to promote the success, and enhance the
value, of Regions Financial Corporation (the "Company"), by linking the personal
interests of its employees, officers and directors to those of Company
stockholders and by providing such persons with an incentive for outstanding
performance. The Plan is further intended to provide flexibility to the Company
in its ability to motivate, attract, and retain the services of employees,
officers and directors upon whose judgment, interest, and special effort the
successful conduct of the Company's operation is largely dependent. Accordingly,
the Plan permits the grant of incentive awards from time to time to selected
employees, officers and directors.
ARTICLE 2
EFFECTIVE DATE
2.1. Effective Date. The Plan shall be effective as of the date upon which
it shall be approved by the Board (the "Effective Date"). However, the Plan
shall be submitted to the stockholders of the Company for approval within 12
months of the Board's approval thereof. No Incentive Stock Options granted under
the Plan may be exercised prior to approval of the Plan by the stockholders and
if the stockholders fail to approve the Plan within 12 months of the Board's
approval thereof, any Incentive Stock Options previously granted hereunder shall
be automatically converted to Non-Qualified Stock Options without any further
act. In the discretion of the Committee, Awards may be made to Covered Employees
which are intended to constitute qualified performance-based compensation under
Code Section 162(m). Any such Awards shall be contingent upon the stockholders
having approved the Plan.
ARTICLE 3
DEFINITIONS
3.1. Definitions. When a word or phrase appears in this Plan with the
initial letter capitalized, and the word or phrase does not commence a sentence,
the word or phrase shall generally be given the meaning ascribed to it in this
Section or in Section 1.1 unless a clearly different meaning is required by the
context. The following words and phrases shall have the following meanings:
(a) "Award" means any Option, Stock Appreciation Right, Restricted
Stock Award, Performance Unit Award, Dividend Equivalent Award, or Other
Stock-Based Award, or any other right or interest relating to Stock or
cash, granted to a Participant under the Plan.
(b) "Award Agreement" means any written agreement, contract, or other
instrument or document evidencing an Award.
(c) "Board" means the Board of Directors of the Company.
(d) "Change in Control" means and includes each of the following:
(i) an acquisition (other than directly from the Company) of any
voting securities of the Company (the "Voting Securities") by any
"Person" ( as the term person is used for the purposes of Section 13(d)
or 14(d) of the Securities Exchange Act of 1934, as amended (the
"Exchange Act") immediately after which such Person has beneficial
ownership (within the meaning of Rule l3d-3
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<PAGE> 38
promulgated under the Exchange Act) of 50% or more of the combined
voting power of the Company's then-outstanding Voting Securities;
provided, however, in determining whether or not a Change in Control has
occurred, Voting Securities which are acquired in a "Non-Control
Acquisition" (as hereinafter defined) shall not constitute an
acquisition which would constitute a Change in Control. A "Non-Control
Acquisition" shall mean (A) an acquisition by (A) any employee benefit
plan (or related trust) sponsored or maintained by the Company or any
Affiliate of the Company, (B) by the Company or (C) any Person in
connection with a Non-Control Transaction (as defined).
(ii) individuals who, as of the date hereof, constitute the Board
(the "Incumbent Board") cease for any reason to constitute at least a
majority of the Board; provided, however, that any individual becoming a
director subsequent to the date hereof whose election, or nomination for
election by the Company's shareholders, was approved by a vote of at
least a majority of the directors then comprising the Incumbent Board
shall be considered as though such individual were a member of the
Incumbent Board, but excluding, for this purpose, any such individual
whose initial assumption of office occurs as a result of an actual or
threatened election contest with respect to the election or removal of
directors or other actual or threatened solicitation of proxies or
consents by or on behalf of a Person other than the Board; or
(iii) The consummation of:
(A) A merger, consolidation or reorganization with or into the
Company in which securities of the Company are issued, unless such
merger, consolidation or reorganization is a "Non-Control
Transaction". A "Non-Control Transaction" is a merger, consolidation
or reorganization with or into the Company or in which securities of
the Company are issued where:
(I) the stockholders of the Company immediately before such
merger, consolidation, or reorganization, own, directly or
indirectly, at least fifty-one percent (51%) of the combined
voting power of the outstanding voting securities of the
corporation resulting form such merger, consolidation or
reorganization (the "Surviving Corporation") in substantially the
same proportion as their ownership of the Voting Securities
immediately before such merger, consolidation or reorganization,
(II) the individuals who were members of the Board
immediately prior tot he execution of the agreement providing for
such merger, consolidation or reorganization constitute at least
a majority of the members of the board of directors of the
Surviving Corporation or a corporation owning directly or
indirectly fifty-one percent (51%) or more of the Voting
Securities of the Surviving Corporation, and
(III) no person other than (i) the Company, (ii) any
subsidiary, (iii) any employee benefit plan (or any trust forming
a part thereof) maintained immediately prior to such merger,
consolidation, or reorganization by the Company owns fifty
percent (50%) or more of the combined voting power of the
Surviving Corporation's then-outstanding voting securities;
(B) A complete liquidation or dissolution of the Company; or
(C) The sale or other disposition of all or substantially all of
the assets of the Company to any Person.
Notwithstanding the foregoing, a Change in Control shall not be
deemed to occur solely because any Person (the "Subject Person")
acquired Beneficial Ownership of more than the permitted amount of
the outstanding Voting Securities as a result of the acquisition of
Voting Securities by the Company which, by reducing the number of
Voting Securities outstanding, increases the proportional number of
shares Beneficially Owned by the Subject Person, provided that if a
Change in Control would occur (but for the operation of this
sentence) and
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after such acquisition of Voting Securities by the Company, the
Subject Person becomes the Beneficial Owner of any additional Voting
Securities, then a Change in Control shall occur.
(e) "Code" means the Internal Revenue Code of 1986, as amended from
time to time.
(f) "Committee" means the committee of the Board described in Article
4.
(g) "Company" means Regions Financial Corporation, a Delaware
corporation.
(h) "Covered Employee" means a covered employee as defined in Code
Section 162(m)(3) or the regulations thereunder.
(i) "Disability" shall mean any illness or other physical or mental
condition of a Participant that renders the Participant incapable of
performing his customary and usual duties for the Company, or any medically
determinable illness or other physical or mental condition resulting from a
bodily injury, disease or mental disorder which, in the judgment of the
Committee, is permanent and continuous in nature. The Committee may require
such medical or other evidence as it deems necessary to judge the nature
and permanency of the Participant's condition. Notwithstanding the above,
with respect to an Incentive Stock Option, Disability shall mean Permanent
and Total Disability as defined in Section 22(e)(3) of the Code.
(j) "Dividend Equivalent" means a right granted to a Participant under
Article 11.
(k) "Effective Date" has the meaning assigned such term in Section
2.1.
(l) "Fair Market Value", on any date, means (i) if the Stock is listed
on a securities exchange or is traded over the Nasdaq National Market, the
closing sales price on such exchange or over such system on such date or,
in the absence of reported sales on such date, the closing sales price on
the immediately preceding date on which sales were reported, or (ii) if the
Stock is not listed on a securities exchange or traded over the Nasdaq
National Market, the mean between the bid and offered prices as quoted by
Nasdaq for such date, provided that if it is determined that the fair
market value is not properly reflected by such Nasdaq quotations, Fair
Market Value will be determined by such other method as the Committee
determines in good faith to be reasonable.
(m) "Incentive Stock Option" means an Option that is intended to meet
the requirements of Section 422 of the Code or any successor provision
thereto.
(n) "Merger of Equals" means any Change of Control transaction
approved by the Incumbent Board and specifically designated by the
Incumbent Board as a Merger of Equals.
(o) "Non-Qualified Stock Option" means an Option that is not an
Incentive Stock Option.
(p) "Option" means a right granted to a Participant under Article 7 of
the Plan to purchase Stock at a specified price during specified time
periods. An Option may be either an Incentive Stock Option or a
Non-Qualified Stock Option.
(q) "Other Stock-Based Award" means a right, granted to a Participant
under Article 12, that relates to or is valued by reference to Stock or
other Awards relating to Stock.
(r) "Parent" means a corporation which owns or beneficially owns a
majority of the outstanding voting stock or voting power of the Company.
For Incentive Stock Options, the term shall have the same meaning as set
forth in Code Section 424(e).
(s) "Participant" means a person who, as an employee, officer or
director of the Company or any Subsidiary, has been granted an Award under
the Plan.
(t) "Performance Unit" means a right granted to a Participant under
Article 9, to receive cash, Stock, or other Awards, the payment of which is
contingent upon achieving certain performance goals established by the
Committee.
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(u) "Plan" means the Regions Financial Corporation 1999 Long-Term
Incentive Plan, as amended from time to time.
(v) "Restricted Stock Award" means Stock granted to a Participant
under Article 10 that is subject to certain restrictions and to risk of
forfeiture.
(w) "Stock" means the $.625 par value Common Stock of the Company, and
such other securities of the Company as may be substituted for Stock
pursuant to Article 14.
(x) "Stock Appreciation Right" or "SAR" means a right granted to a
Participant under Article 8 to receive a payment equal to the difference
between the Fair Market Value of a share of Stock as of the date of
exercise of the SAR over the grant price of the SAR, all as determined
pursuant to Article 8.
(y) "Subsidiary" means any corporation, limited liability company,
partnership or other entity of which a majority of the outstanding voting
stock or voting power is beneficially owned directly or indirectly by the
Company. For Incentive Stock Options, the term shall have the meaning set
forth in Code Section 424(f).
(z) "1933 Act" means the Securities Act of 1933, as amended from time
to time.
(aa) "1934 Act" means the Securities Exchange Act of 1934, as amended
from time to time.
ARTICLE 4
ADMINISTRATION
4.1. Committee. The Plan shall be administered by the Compensation
Committee of the Board or, at the discretion of the Board from time to time, by
the Board. The Committee shall consist of two or more members of the Board. It
is intended that the directors appointed to serve on the Committee shall be
"non-employee directors" (within the meaning of Rule 16b-3 promulgated under the
1934 Act) and "outside directors" (within the meaning of Code Section 162(m) and
the regulations thereunder) to the extent that Rule 16b-3 and, if necessary for
relief from the limitation under Code Section 162(m) and such relief is sought
by the Company, Code Section 162(m), respectively, are applicable. However, the
mere fact that a Committee member shall fail to qualify under either of the
foregoing requirements shall not invalidate any Award made by the Committee
which Award is otherwise validly made under the Plan. The members of the
Committee shall be appointed by, and may be changed at any time and from time to
time in the discretion of, the Board. During any time that the Board is acting
as administrator of the Plan, it shall have all the powers of the Committee
hereunder, and any reference herein to the Committee (other than in this Section
4.1) shall include the Board.
4.2. Action by the Committee. For purposes of administering the Plan, the
following rules of procedure shall govern the Committee. A majority of the
Committee shall constitute a quorum. The acts of a majority of the members
present at any meeting at which a quorum is present, and acts approved
unanimously in writing by the members of the Committee in lieu of a meeting,
shall be deemed the acts of the Committee. Each member of the Committee is
entitled to, in good faith, rely or act upon any report or other information
furnished to that member by any officer or other employee of the Company or any
Parent or Subsidiary, the Company's independent certified public accountants, or
any executive compensation consultant or other professional retained by the
Company to assist in the administration of the Plan.
4.3. Authority of Committee. The Committee has the exclusive power,
authority and discretion to:
(a) Designate Participants;
(b) Determine the type or types of Awards to be granted to each
Participant;
(c) Determine the number of Awards to be granted and the number of
shares of Stock to which an Award will relate;
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(d) Determine the terms and conditions of any Award granted under the
Plan, including but not limited to, the exercise price, grant price, or
purchase price, any restrictions or limitations on the Award, any schedule
for lapse of forfeiture restrictions or restrictions on the exercisability
of an Award, and accelerations or waivers thereof, based in each case on
such considerations as the Committee in its sole discretion determines;
(e) Accelerate the vesting or lapse of restrictions of any outstanding
Award, based in each case on such considerations as the Committee in its
sole discretion determines;
(f) Determine whether, to what extent, and under what circumstances an
Award may be settled in, or the exercise price of an Award may be paid in,
cash, Stock, other Awards, or other property, or an Award may be canceled,
forfeited, or surrendered;
(g) Prescribe the form of each Award Agreement, which need not be
identical for each Participant;
(h) Decide all other matters that must be determined in connection
with an Award;
(i) Establish, adopt or revise any rules and regulations as it may
deem necessary or advisable to administer the Plan;
(j) Make all other decisions and determinations that may be required
under the Plan or as the Committee deems necessary or advisable to
administer the Plan; and
(k) Amend the Plan or any Award Agreement as provided herein.
4.4. Decisions Binding. The Committee's interpretation of the Plan, any
Awards granted under the Plan, any Award Agreement and all decisions and
determinations by the Committee with respect to the Plan are final, binding, and
conclusive on all parties.
ARTICLE 5
SHARES SUBJECT TO THE PLAN
5.1. NUMBER OF SHARES. Subject to adjustment as provided in Section 14.1,
the aggregate number of shares of Stock reserved and available for Awards or
which may be used to provide a basis of measurement for or to determine the
value of an Award (such as with a Stock Appreciation Right or Performance Unit
Award) shall be ten million (10,000,000 shares. Not more than 10% of the total
authorized shares may be granted as Awards of Restricted Stock or unrestricted
Stock Awards.
5.2. LAPSED AWARDS. To the extent that an Award is canceled, terminates,
expires or lapses for any reason, any shares of Stock subject to the Award will
again be available for the grant of an Award under the Plan and shares subject
to SARs or other Awards settled in cash will be available for the grant of an
Award under the Plan.
5.3. STOCK DISTRIBUTED. Any Stock distributed pursuant to an Award may
consist, in whole or in part, of authorized and unissued Stock, treasury Stock
or Stock purchased on the open market.
5.4. LIMITATION ON AWARDS. Notwithstanding any provision in the Plan to
the contrary (but subject to adjustment as provided in Section 14.1), the
maximum number of shares of Stock with respect to one or more Options and/or
SARs that may be granted during any one calendar year under the Plan to any one
Covered Employee shall be 150,000. The maximum fair market value (measured as of
the date of grant) of any Awards other than Options and SARs that may be
received by a Covered Employee (less any consideration paid by the Participant
for such Award) during any one calendar year under the Plan shall be $4,000,000.
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ARTICLE 6
ELIGIBILITY
6.1. General. Awards may be granted only to individuals who are employees,
officers or directors of the Company or a Parent or Subsidiary.
ARTICLE 7
STOCK OPTIONS
7.1. General. The Committee is authorized to grant Options to Participants
on the following terms and conditions:
(a) Exercise Price. The exercise price per share of Stock under an
Option shall be determined by the Committee, provided that the exercise
price for any Option shall not be less than the Fair Market Value as of the
date of the grant.
(b) Time and Conditions of Exercise. The Committee shall determine
the time or times at which an Option may be exercised in whole or in part.
The Committee also shall determine the performance or other conditions, if
any, that must be satisfied before all or part of an Option may be
exercised. The Committee may waive any exercise provisions at any time in
whole or in part based upon factors as the Committee may determine in its
sole discretion so that the Option becomes exerciseable at an earlier date.
(c) Payment. The Committee shall determine the methods by which the
exercise price of an Option may be paid, the form of payment, including,
without limitation, cash, shares of Stock, or other property (including
"cashless exercise" arrangements), and the methods by which shares of Stock
shall be delivered or deemed to be delivered to Participants; provided that
if shares of Stock surrendered in payment of the exercise price were
themselves acquired otherwise than on the open market, such shares shall
have been held by the Participant for at least six months.
(d) Evidence of Grant. All Options shall be evidenced by a written
Award Agreement between the Company and the Participant. The Award
Agreement shall include such provisions, not inconsistent with the Plan, as
may be specified by the Committee.
7.2. Incentive Stock Options. The terms of any Incentive Stock Options
granted under the Plan must comply with the following additional rules:
(a) Exercise Price. The exercise price per share of Stock shall be
set by the Committee, provided that the exercise price for any Incentive
Stock Option shall not be less than the Fair Market Value as of the date of
the grant.
(b) Exercise. In no event may any Incentive Stock Option be
exercisable for more than ten years from the date of its grant.
(c) Lapse of Option. An Incentive Stock Option shall lapse under the
earliest of the following circumstances; provided, however, that the
Committee may, prior to the lapse of the Incentive Stock Option under the
circumstances described in paragraphs (3), (4) and (5) below, provide in
writing that the Option will extend until a later date, but if Option is
exercised after the dates specified in paragraphs (3), (4) and (5) below,
it will automatically become a Non-Qualified Stock Option:
(1) The Incentive Stock Option shall lapse as of the option
expiration date set forth in the Award Agreement.
(2) The Incentive Stock Option shall lapse ten years after it is
granted, unless an earlier time is set in the Award Agreement.
(3) If the Participant terminates employment for any reason other
than as provided in paragraph (4) or (5) below, the Incentive Stock
Option shall lapse, unless it is previously exercised,
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three months after the Participant's termination of employment;
provided, however, that if the Participant's employment is terminated by
the Company for cause or by the Participant without the consent of the
Company, the Incentive Stock Option shall (to the extent not previously
exercised) lapse immediately.
(4) If the Participant terminates employment by reason of his
Disability, the Incentive Stock Option shall lapse, unless it is
previously exercised, one year after the Participant's termination of
employment.
(5) If the Participant dies while employed, or during the
three-month period described in paragraph (3) or during the one-year
period described in paragraph (4) and before the Option otherwise
lapses, the Option shall lapse one year after the Participant's death.
Upon the Participant's death, any exercisable Incentive Stock Options
may be exercised by the Participant's beneficiary, determined in
accordance with Section 13.6.
Unless the exercisability of the Incentive Stock Option is accelerated
as provided in Article 13, if a Participant exercises an Option after
termination of employment, the Option may be exercised only with respect
to the shares that were otherwise vested on the Participant's
termination of employment.
(d) Individual Dollar Limitation. The aggregate Fair Market Value
(determined as of the time an Award is made) of all shares of Stock with
respect to which Incentive Stock Options are first exercisable by a
Participant in any calendar year may not exceed $100,000.00.
(e) Ten Percent Owners. No Incentive Stock Option shall be granted to
any individual who, at the date of grant, owns stock possessing more than
ten percent of the total combined voting power of all classes of stock of
the Company or any Parent or Subsidiary unless the exercise price per share
of such Option is at least 110% of the Fair Market Value per share of Stock
at the date of grant and the Option expires no later than five years after
the date of grant.
(f) Expiration of Incentive Stock Options. No Award of an Incentive
Stock Option may be made pursuant to the Plan after the day immediately
prior to the tenth anniversary of the Effective Date.
(g) Right To Exercise. During a Participant's lifetime, an Incentive
Stock Option may be exercised only by the Participant or, in the case of
the Participant's Disability, by the Participant's guardian or legal
representative.
(h) Directors. The Committee may not grant an Incentive Stock Option
to a non-employee director. The Committee may grant an Incentive Stock
Option to a director who is also an employee of the Company or Parent or
Subsidiary but only in that individual's position as an employee and not as
a director.
ARTICLE 8
STOCK APPRECIATION RIGHTS
8.1. Grant of SARs. The Committee is authorized to grant SARs to
Participants on the following terms and conditions:
(a) Right To Payment. Upon the exercise of a Stock Appreciation
Right, the Participant to whom it is granted has the right to receive the
excess, if any, of:
(1) The Fair Market Value of one share of Stock on the date of
exercise; over
(2) The grant price of the Stock Appreciation Right as determined
by the Committee, which shall not be less than the Fair Market Value of
one share of Stock on the date of grant.
(b) Other Terms. All awards of Stock Appreciation Rights shall be
evidenced by an Award Agreement. The terms, methods of exercise, methods of
settlement, form of consideration payable in
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settlement, and any other terms and conditions of any Stock Appreciation
Right shall be determined by the Committee at the time of the grant of the
Award and shall be reflected in the Award Agreement.
ARTICLE 9
PERFORMANCE UNITS
9.1. Grant of Performance Units. The Committee is authorized to grant
Performance Units to Participants on such terms and conditions as may be
selected by the Committee. The Committee shall have the complete discretion to
determine the number of Performance Units granted to each Participant. All
Awards of Performance Units shall be evidenced by an Award Agreement.
9.2. Right To Payment. A grant of Performance Units gives the Participant
rights, valued as determined by the Committee, and payable to, or exercisable
by, the Participant to whom the Performance Units are granted, in whole or in
part, as the Committee shall establish at grant or thereafter. The Committee
shall set performance goals and other terms or conditions to payment of the
Performance Units in its discretion which, depending on the extent to which they
are met, will determine the number and value of Performance Units that will be
paid to the Participant.
9.3. Other Terms. Performance Units may be payable in cash, Stock, or
other property, and have such other terms and conditions as determined by the
Committee and reflected in the Award Agreement.
ARTICLE 10
RESTRICTED STOCK AWARDS
10.1. Grant of Restricted Stock. The Committee is authorized to make
Awards of Restricted Stock to Participants in such amounts and subject to such
terms and conditions as may be selected by the Committee. All Awards of
Restricted Stock shall be evidenced by a Restricted Stock Award Agreement.
10.2. Issuance and Restrictions. Restricted Stock shall be subject to such
restrictions on transferability and other restrictions as the Committee may
impose (including, without limitation, limitations on the right to vote
Restricted Stock or the right to receive dividends on the Restricted Stock).
These restrictions may lapse separately or in combination at such times, under
such circumstances, in such installments, upon the satisfaction of performance
goals or otherwise, as the Committee determines at the time of the grant of the
Award or thereafter.
10.3. Forfeiture. Except as otherwise determined by the Committee at the
time of the grant of the Award or thereafter, upon termination of employment
during the applicable restriction period or upon failure to satisfy a
performance goal during the applicable restriction period, Restricted Stock that
is at that time subject to restrictions shall be forfeited and reacquired by the
Company; provided, however, that the Committee may provide in any Award
Agreement that restrictions or forfeiture conditions relating to Restricted
Stock will be waived in whole or in part in the event of terminations resulting
from specified causes, and the Committee may in other cases waive in whole or in
part restrictions or forfeiture conditions relating to Restricted Stock.
10.4. Certificates for Restricted Stock. Restricted Stock granted under
the Plan may be evidenced in such manner as the Committee shall determine. If
certificates representing shares of Restricted Stock are registered in the name
of the Participant, certificates must bear an appropriate legend referring to
the terms, conditions, and restrictions applicable to such Restricted Stock.
ARTICLE 11
DIVIDEND EQUIVALENTS
11.1. Grant of Dividend Equivalents. The Committee is authorized to grant
Dividend Equivalents to Participants subject to such terms and conditions as may
be selected by the Committee. Dividend Equivalents
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shall entitle the Participant to receive payments equal to dividends with
respect to all or a portion of the number of shares of Stock subject to an
Award, as determined by the Committee. The Committee may provide that Dividend
Equivalents be paid or distributed when accrued or be deemed to have been
reinvested in additional shares of Stock, or otherwise reinvested.
ARTICLE 12
OTHER STOCK-BASED AWARDS
12.1. Grant of Other Stock-Based Awards. The Committee is authorized,
subject to limitations under applicable law, to grant to Participants such other
Awards that are payable in, valued in whole or in part by reference to, or
otherwise based on or related to shares of Stock, as deemed by the Committee to
be consistent with the purposes of the Plan, including without limitation shares
of Stock awarded purely as a "bonus" and not subject to any restrictions or
conditions, convertible or exchangeable debt securities, other rights
convertible or exchangeable into shares of Stock, and Awards valued by reference
to book value of shares of Stock or the value of securities of or the
performance of specified Parents or Subsidiaries. The Committee shall determine
the terms and conditions of such Awards.
ARTICLE 13
PROVISIONS APPLICABLE TO AWARDS
13.1. Stand-Alone, Tandem, and Substitute Awards. Awards granted under the
Plan may, in the discretion of the Committee, be granted either alone or in
addition to, in tandem with, or in substitution for, any other Award granted
under the Plan. If an Award is granted in substitution for another Award, the
Committee may require the surrender of such other Award in consideration of the
grant of the new Award. Awards granted in addition to or in tandem with other
Awards may be granted either at the same time as or at a different time from the
grant of such other Awards.
13.2. Exchange Provisions. The Committee may at any time offer to exchange
or buy out any previously granted Award for a payment in cash, Stock, or another
Award (subject to Section 14.1), based on the terms and conditions the Committee
determines and communicates to the Participant at the time the offer is made,
and after taking into account the tax, securities and accounting effects of such
an exchange.
13.3. Term of Award. The term of each Award shall be for the period as
determined by the Committee, provided that in no event shall the term of any
Incentive Stock Option or a Stock Appreciation Right granted in tandem with the
Incentive Stock Option exceed a period of ten years from the date of its grant
(or, if Section 7.2(e) applies, five years from the date of its grant).
13.4. Form of Payment for Awards. Subject to the terms of the Plan and any
applicable law or Award Agreement, payments or transfers to be made by the
Company or a Parent or Subsidiary on the grant or exercise of an Award may be
made in such form as the Committee determines at or after the time of grant,
including without limitation, cash, Stock, other Awards, or other property, or
any combination, and may be made in a single payment or transfer, in
installments, or on a deferred basis, in each case determined in accordance with
rules adopted by, and at the discretion of, the Committee.
13.5. Limits on Transfer. No right or interest of a Participant in any
unexercised or restricted Award may be pledged, encumbered, or hypothecated to
or in favor of any party other than the Company or a Parent or Subsidiary, or
shall be subject to any lien, obligation, or liability of such Participant to
any other party other than the Company or a Parent or Subsidiary. No unexercised
or restricted Award shall be assignable or transferable by a Participant other
than by will or the laws of descent and distribution or, except in the case of
an Incentive Stock Option, pursuant to a domestic relations order that would
satisfy Section 414(p)(1)(A) of the Code if such Section applied to an Award
under the Plan; provided, however, that the Committee may (but need not) permit
other transfers where the Committee concludes that such transferability (i) does
not result in accelerated taxation, (ii) does not cause any Option intended to
be an incentive stock option to fail to be described in Code Section 422(b), and
(iii) is otherwise appropriate and desirable, taking into account any
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factors deemed relevant, including without limitation, any state or federal
taxor securities laws or regulations applicable to transferable Awards.
13.6. Beneficiaries. Notwithstanding Section 13.5, a Participant may, in
the manner determined by the Committee, designate a beneficiary to exercise the
rights of the Participant and to receive any distribution with respect to any
Award upon the Participant's death. A beneficiary, legal guardian, legal
representative, or other person claiming any rights under the Plan is subject to
all terms and conditions of the Plan and any Award Agreement applicable to the
Participant, except to the extent the Plan and Award Agreement otherwise
provide, and to any additional restrictions deemed necessary or appropriate by
the Committee. If no beneficiary has been designated or survives the
Participant, payment shall be made to the Participant's estate. Subject to the
foregoing, a beneficiary designation may be changed or revoked by a Participant
at any time provided the change or revocation is filed with the Committee.
13.7. Stock Certificates. All Stock certificates delivered under the Plan
are subject to any stop-transfer orders and other restrictions as the Committee
deems necessary or advisable to comply with federal or state securities laws,
rules and regulations and the rules of any national securities exchange or
automated quotation system on which the Stock is listed, quoted, or traded. The
Committee may place legends on any Stock certificate to reference restrictions
applicable to the Stock.
13.8. Acceleration Upon A Change in Control. Except as otherwise provided
in the Award Agreement, upon the occurrence of a Change in Control which is not
a Merger of Equals, all outstanding Options, Stock Appreciation Rights, and
other Awards in the nature of rights that may be exercised shall become fully
exercisable and all restrictions on outstanding Awards shall lapse; provided,
however that such acceleration will not occur if, in the opinion of the
Company's accountants, such acceleration would preclude the use of "pooling of
interest" accounting treatment for a Change in Control transaction that (a)
would otherwise qualify for such accounting treatment, and (b) is contingent
upon qualifying for such accounting treatment. To the extent that this provision
causes Incentive Stock Options to exceed the dollar limitation set forth in
Section 7.2(d), the excess Options shall be deemed to be Non-Qualified Stock
Options.
13.9. Acceleration Upon Certain Events Not Constituting A Change in
Control. In the event of the occurrence of any circumstance, transaction or
event not constituting a Change in Control (as defined in Section 3.1) but which
the Board of Directors deems to be, or to be reasonably likely to lead to, an
effective change in control of the Company of a nature that would be required to
be reported in response to Item 6(e) of Schedule 14A of the 1934 Act, the
Committee may in its sole discretion declare all outstanding Options, Stock
Appreciation Rights, and other Awards in the nature of rights that may be
exercised to be fully exercisable, and/or all restrictions on all outstanding
Awards to have lapsed, in each case, as of such date as the Committee may, in
its sole discretion, declare, which may be on or before the consummation of such
transaction or event. To the extent that this provision causes Incentive Stock
Options to exceed the dollar limitation set forth in Section 7.2(d), the excess
Options shall be deemed to be Non-Qualified Stock Options.
13.10. Acceleration For any Other Reason. Regardless of whether an event
has occurred as described in Section 13.8 or 13.9 above, the Committee may in
its sole discretion at any time determine that all or a portion of a
Participant's Options, Stock Appreciation Rights, and other Awards in the nature
of rights that may be exercised shall become fully or partially exercisable,
and/or that all or a part of the restrictions on all or a portion of the
outstanding Awards shall lapse, in each case, as of such date as the Committee
may, in its sole discretion, declare. The Committee may discriminate among
Participants and among Awards granted to a Participant in exercising its
discretion pursuant to this Section 13.10.
13.11. Effect of Acceleration. If an Award is accelerated under Section
13.8 or 13.9, the Committee may, in its sole discretion, provide (i) that the
Award will expire after a designated period of time after such acceleration to
the extent not then exercised, (ii) that the Award will be settled in cash
rather than Stock, (iii) that the Award will be assumed by another party to the
transaction giving rise to the acceleration or otherwise be equitably converted
in connection with such transaction, or (iv) any combination of the foregoing.
The Committee's determination need not be uniform and may be different for
different Participants whether or not such Participants are similarly situated.
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13.12. Performance Goals. The Committee may determine that any Award
granted pursuant to this Plan to a Participant (including, but not limited to,
Participants who are Covered Employees) shall be determined solely on the basis
of (a) the achievement by the Company or a Parent or Subsidiary of a specified
target return, or target growth in return, on equity or assets, (b) the
Company's total shareholder return (stock price appreciation plus reinvested
dividends) relative to a defined comparison group or target over a specified
performance period, (c) the Company's stock price, (d) the achievement by an
individual, the Company, or a business unit of the Company, Parent or Subsidiary
of a specified target, or target growth in, revenues, net income or earnings per
share or decrease in expense, (e) the achievement of objectively determinable
goals with respect to service or product delivery, service or product quality,
customer satisfaction, meeting budgets and/or retention of employees or (f) any
combination of the goals set forth in (a) through (e) above. If an Award is made
on such basis, the Committee shall establish goals prior to the beginning of the
period for which such performance goal relates (or such later date as may be
permitted under Code Section 162(m) or the regulations thereunder) and the
Committee may for any reason reduce (but not increase) any Award,
notwithstanding the achievement of a specified goal. Any payment of an Award
granted with performance goals shall be conditioned on the written certification
of the Committee in each case that the performance goals and any other material
conditions were satisfied.
13.13. Termination of Employment. Whether military, government or other
service or other leave of absence shall constitute a termination of employment
shall be determined in each case by the Committee at its discretion, and any
determination by the Committee shall be final and conclusive. A termination of
employment shall not occur in a circumstance in which a Participant transfers
from the Company to one of its Parents or Subsidiaries, transfers from a Parent
or Subsidiary to the Company, or transfers from one Parent or Subsidiary to
another Parent or Subsidiary.
ARTICLE 14
CHANGES IN CAPITAL STRUCTURE
14.1. General. In the event a stock dividend is declared upon the Stock,
the authorization limits under Section 5.1 and 5.4 shall be increased
proportionately, and the shares of Stock then subject to each Award shall be
increased proportionately without any change in the aggregate purchase price
therefor. In the event the Stock shall be changed into or exchanged for a
different number or class of shares of stock or securities of the Company or of
another corporation, whether through reorganization, recapitalization,
reclassification, share exchange, stock split-up, combination of shares, merger
or consolidation, the authorization limits under Section 5.1 and 5.4 shall be
adjusted proportionately, and there shall be substituted for each such share of
Stock then subject to each Award the number and class of shares into which each
outstanding share of Stock shall be so exchanged, all without any change in the
aggregate purchase price for the shares then subject to each Award, or, subject
to Section 15.2, there shall be made such other equitable adjustment as the
Committee shall approve.
ARTICLE 15
AMENDMENT, MODIFICATION AND TERMINATION
15.1. Amendment, Modification and Termination. The Board or the Committee
may, at any time and from time to time, amend, modify or terminate the Plan
without stockholder approval; provided, however, that the Board or Committee may
condition any amendment or modification on the approval of stockholders of the
Company if such approval is necessary or deemed advisable with respect to tax,
securities or other applicable laws, policies or regulations.
15.2. Awards Previously Granted. At any time and from time to time, the
Committee may amend, modify or terminate any outstanding Award without approval
of the Participant; provided, however, that, subject to the terms of the
applicable Award Agreement, such amendment, modification or termination shall
not, without the Participant's consent, reduce or diminish the value of such
Award determined as if the Award had been exercised, vested, cashed in or
otherwise settled on the date of such amendment or termination. No
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termination, amendment, or modification of the Plan shall adversely affect any
Award previously granted under the Plan, without the written consent of the
Participant.
ARTICLE 16
GENERAL PROVISIONS
16.1. No Rights to Awards. No Participant or eligible participant shall
have any claim to be granted any Award under the Plan, and neither the Company
nor the Committee is obligated to treat Participants or eligible participants
uniformly.
16.2. No Stockholder Rights. No Award gives the Participant any of the
rights of a stockholder of the Company unless and until shares of Stock are in
fact issued to such person in connection with such Award.
16.3. Withholding. The Company or any Parent or Subsidiary shall have the
authority 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
(including the Participant's FICA obligation) required by law to be withheld
with respect to any taxable event arising as a result of the Plan. With respect
to withholding required upon any taxable event under the Plan, the Committee
may, at the time the Award is granted or thereafter, require that any such
withholding requirement be satisfied, in whole or in part, by withholding shares
of Stock having a Fair Market Value on the date of withholding equal to the
amount required to be withheld for tax purposes, all in accordance with such
procedures as the Committee establishes.
16.4. No Right to Continued Service. Nothing in the Plan or any Award
Agreement shall interfere with or limit in any way the right of the Company or
any Parent or Subsidiary to terminate any Participant's employment or status as
an officer or director at any time, nor confer upon any Participant any right to
continue as an employee, officer or director of the Company or any Parent or
Subsidiary.
l6.5. Unfunded Status of Awards. The Plan is intended to be an "unfunded"
plan for incentive and deferred compensation. With respect to any payments not
yet made to a Participant pursuant to an Award, nothing contained in the Plan or
any Award Agreement shall give the Participant any rights that are greater than
those of a general creditor of the Company or any Parent or Subsidiary.
16.6. Indemnification. To the extent allowable under applicable law, each
member of the Committee shall be indemnified and held harmless by the Company
from any loss, cost, liability, or expense that may be imposed upon or
reasonably incurred by such member in connection with or resulting from any
claim, action, suit, or proceeding to which such member may be a party or in
which he may be involved by reason of any action or failure to act under the
Plan and against and from any and all amounts paid by such member in
satisfaction of judgment in such action, suit, or proceeding against him
provided he gives the Company an opportunity, at its own expense, to handle and
defend the same before he undertakes to handle and defend it on his 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 Articles 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.
16.7. Relationship to Other Benefits. No payment under the Plan shall be
taken into account in determining any benefits under any pension, retirement,
savings, profit sharing, group insurance, welfare or benefit plan of the Company
or any Parent or Subsidiary unless provided otherwise in such other plan.
16.8. Expenses. The expenses of administering the Plan shall be borne by
the Company and its Parents or Subsidiaries.
16.9. Titles and Headings. The titles and headings of the Sections in the
Plan are for convenience of reference only, and in the event of any conflict,
the text of the Plan, rather than such titles or headings, shall control.
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<PAGE> 49
16.10. 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.
16.11. Fractional Shares. No fractional shares of Stock shall be issued
and the Committee shall determine, in its discretion, whether cash shall be
given in lieu of fractional shares or whether such fractional shares shall be
eliminated by rounding up.
16.12. Government and Other Regulations. The obligation of the Company to
make payment of awards in Stock or otherwise shall be subject to all applicable
laws, rules, and regulations, and to such approvals by government agencies as
may be required. The Company shall be under no obligation to register under the
1933 Act, or any state securities act, any of the shares of Stock paid under the
Plan. The shares paid under the Plan may in certain circumstances be exempt from
registration under the 1933 Act, and the Company may restrict the transfer of
such shares in such manner as it deems advisable to ensure the availability of
any such exemption.
16.13. Governing Law. To the extent not governed by federal law, the Plan
and all Award Agreements shall be construed in accordance with and governed by
the laws of the State of Delaware.
16.14. Additional Provisions. Each Award Agreement may contain such other
terms and conditions as the Committee may determine; provided that such other
terms and conditions are not inconsistent with the provisions of this Plan.
The foregoing is hereby acknowledged as being the Regions Financial
Corporation 1999 Long-Term Incentive Plan as adopted by the Board of Directors
of the Company on March 17, 1999.
REGIONS FINANCIAL CORPORATION
By: /s/ Carl E. Jones, Jr.
Its: President and Chief Executive Officer
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<PAGE> 50
REGIONS FINANCIAL CORPORATION
P.O. BOX 10247
BIRMINGHAM, ALABAMA 35202-0247
Regions stockholders can now vote their shares over either the telephone or the
internet. This eliminates the need to return the proxy card. To vote your shares
over the telephone or the internet you must have your proxy card and SSN
available. The series of numbers that appear in the box above must be used to
access the system.
1. To vote over the telephone: On a touch-tone telephone call 1-800-OK2-VOTE
(1-800-652-8683), 24 hours a day, seven days a week.
2. To vote over the internet: Log on to the internet and go to the website
http://www.vote-by-net.com.
Your vote over the telephone or the internet authorizes the named proxies in
the same manner as if you marked, signed, dated and returned your proxy card. If
you choose to vote your shares over the telephone or the internet, there is no
need for you to mail back the proxy card.
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
The undersigned hereby appoints J. Stanley Mackin and Richard D. Horsley, and
each of them, as Proxies, each with the power to appoint his substitute, and
hereby authorizes each to represent and to vote, as designated on the reverse
side, all the shares of common stock of Regions Financial Corporation
("Regions") held of record by the undersigned, at the Annual Meeting of
stockholders to be held May 19, 1999, or any adjournment thereof. This card also
constitutes voting instructions for all shares beneficially owned and votable,
if any, by the undersigned as a participant in the Regions Financial Corporation
Dividend Reinvestment Plan, Employee Stock Purchase Plan, Employee Profit
Sharing Plan and/or Directors Stock Investment Plan and held of record by the
administrators and trustees of such Plans. IF NO DIRECTION IS MADE AS TO THE
MANNER OF VOTING, THE PROXY WILL BE VOTED FOR ITEMS ONE AND THREE AND FOR THE
ELECTION OF DIRECTORS.
[X] PLEASE MARK YOUR VOTES AS IN THIS EXAMPLE.
THIS PROXY WHEN PROPERLY EXECUTED WILL BE VOTED IN THE MANNER DIRECTED HEREIN
BY THE UNDERSIGNED STOCKHOLDER. IF NO DIRECTION IS MADE, THIS PROXY WILL BE
VOTED FOR THE NOMINEES LISTED IN ITEM 1, AND FOR ITEMS 2, 3, and 4.
1. Election of Directors
To elect the five nominees for director of Regions listed below:
[ ] FOR [ ] WITHHELD
For, except vote withheld from the following nominee(s):
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Sheila S. Blair, Barnett Grace, Olin B. King, Lee J. Styslinger, Jr., and
C. Kemmons Wilson, Jr.
(Continued and to be signed on reverse side)
<PAGE> 51
(Continued from other side)
2. Proposal to approve the proposed amendment to and restatement of the
Certificate of Incorporation
[ ] FOR [ ] AGAINST [ ] ABSTAIN
3. Proposal to approve the Management Incentive Plan.
[ ] FOR [ ] AGAINST [ ] ABSTAIN
4. Proposal to approve the 1999 Long Term Incentive Plan.
[ ] FOR [ ] AGAINST [ ] ABSTAIN
5. In their discretion on such other business as may properly come before the
meeting or any adjournments thereof.
Should the undersigned be present and elect to vote at the Annual Meeting or
at any adjournment thereof and after notification to the Secretary of Regions at
the meeting of the stockholder's decision to terminate this proxy, then this
proxy shall be deemed terminated and of no further force and effect. This proxy
may also be revoked by submission of a properly executed subsequently dated
proxy or by written notice to Regions for receipt prior to the Annual Meeting.
Please sign exactly as your
name appears on this card.
When signing as attorney,
executor, administrator,
trustee or guardian, please
give full title. If shares are
held jointly, each holder must
sign.
Please complete, date, sign
and mail this proxy promptly
in the enclosed
postage-prepaid envelope.
Date , 1999
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Signature(s)
