<PAGE>
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the Securities
Exchange Act of 1934
Filed by the Registrant [x]
Filed by a Party other than the Registrant [ ]
Check the appropriate box:
[ ] Preliminary Proxy Statement
[ ] Confidential, for Use of Commission Only
[X] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to 240.14a-11(c) or 240.14a-12
TRUSTMARK CORPORATION
(Name of Registrant as Specified in its Charter)
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:
---------------------------------------------------------
4) Proposed maximum aggregate value of transaction:
---------------------------------------------------------
5) Total fee paid:
---------------------------------------------------------
[ ] Fee paid previously with preliminary materials.
[ ] Check box if any part of the fee is offset as provided by Exchange Act
Rule 0-11(a)(2) and identify the filing for which the offsetting fee was
paid previously. Identify the previous filing by registration statement
number, or the Form or Schedule and the date of its filing.
1) Amount Previously Paid:
--------------------------------------------------------
2) Form, Schedule or Registration Statement No.:
--------------------------------------------------------
3) Filing Party:
--------------------------------------------------------
4) Date Filed:
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<PAGE>
TRUSTMARK CORPORATION
Post Office Box 291 Jackson, Mississippi 39205-0291
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
March 11, 1997
TO THE SHAREHOLDERS:
The annual meeting of the shareholders of Trustmark Corporation, a
Mississippi corporation (the "Corporation"), will be held in Ballroom "A" of the
Ramada Plaza Hotel, located at Interstate 55 North and County Line Road,
Jackson, Mississippi, on Tuesday, March 11, 1997, at 10:00 A.M., local time, for
the following purposes:
1. To elect a board of twenty-five directors to hold office for the
ensuing year and until their successors are elected and have
qualified.
2. To approve Trustmark Corporation 1997 Long Term Incentive Plan
described in the Proxy Statement accompanying this notice.
3. To transact such other business as may properly come before the
meeting.
The close of business on January 24, 1997 has been fixed as the record date
for the determination of the shareholders entitled to notice of and to vote at
the annual meeting or any adjournment thereof. The stock transfer books will not
close.
You are urged to sign and return the enclosed proxy as promptly as
possible, whether or not you plan to attend the meeting in person. If you do
attend the meeting, you may then revoke your proxy prior to the voting thereof.
The proxy also may be revoked at any time prior to its exercise by written
notice to the Secretary of the Corporation or by execution of a subsequently
dated proxy.
BY ORDER OF THE BOARD OF DIRECTORS.
/s/ Frank R. Day
----------------
Chairman
Dated and Mailed at
Jackson, Mississippi
On or about February 14, 1997
Enclosures: 1) Proxy
2) Business Reply Envelope
3) Annual Report
<PAGE>
TRUSTMARK CORPORATION
Post Office Box 291 Jackson, Mississippi 39205-0291
PROXY STATEMENT FOR ANNUAL MEETING OF SHAREHOLDERS
March 11, 1997
I. GENERAL
This proxy statement is furnished in connection with the solicitation by
the Board of Directors of the Corporation of proxies for the annual meeting of
shareholders to be held in Ballroom "A" of the Ramada Plaza Hotel, located at
Interstate 55 North and County Line Road, Jackson, Mississippi, on Tuesday,
March 11, 1997, at 10:00 A.M., local time, and for any adjournment or
adjournments thereof, for the purposes set forth in the foregoing notice of
annual meeting of shareholders.
Any shareholder giving a proxy has the right to revoke it at any time prior
to its exercise on the specific matter to be voted upon by written notice to the
Secretary, by revocation at the meeting, or by execution of a subsequently dated
proxy. All valid proxies received by the Corporation will be voted in accordance
with the instructions indicated in such proxies. If no instructions are
indicated in an otherwise properly executed proxy, it will be voted for the
slate of directors proposed by the Board of Directors and for the proposed
Trustmark Corporation 1997 Long Term Incentive Plan.
Shareholders of record at the close of business on January 24, 1997 are
entitled to notice of and to vote at the meeting in person or by proxy. A
majority of the shares outstanding constitute a quorum. On the record date the
Corporation had outstanding 34,910,683 shares of common stock. Except in the
election of directors each share is entitled to one vote, and action on a matter
is approved if the votes cast in favor of the action exceed the votes cast
opposing the action. Abstentions are not counted.
Solicitation of proxies will be primarily by mail. Employees of the
Corporation and its subsidiaries may be used to solicit proxies by means of
telephone, telegraph, or personal contact, but at no additional compensation.
Banks, brokers, trustees, and nominees will be reimbursed for reasonable
expenses incurred in sending proxy materials to the beneficial owners of such
shares. The total cost of the solicitation will be borne by the Corporation.
The Board of Directors is not aware of any matters other than as set forth
herein which are likely to be brought before the meeting. If other matters do
come before the meeting, the persons named in the accompanying proxy or their
substitutes will vote the shares represented by such proxies in accordance with
the recommendations of the Board of Directors of the Corporation.
<PAGE>
II. ELECTION OF DIRECTORS
The following slate of twenty-five nominees has been proposed by the Board
of Directors for election at the meeting. The shares represented by the proxies
will, unless authority to vote is withheld, be voted in favor of these persons.
In the election of directors each shareholder may vote his shares cumulatively
by multiplying the number of shares he is entitled to vote by the number of
directors to be elected. This product shall be the number of votes the
shareholder may cast for one nominee or by distributing this number of votes
among any number of nominees. If a shareholder withholds authority for one or
more nominees and does not direct otherwise, the total number of votes the
shareholder is entitled to cast will be distributed equally among the remaining
nominees. Should any of these nominees be unable to accept the nomination, the
votes which otherwise would have been cast for that nominee will be voted for
such other persons as the Board of Directors shall nominate. Each director is
elected to hold office until the next annual meeting of shareholders and until
his successor is elected and qualified. Shareholders may make nominations at the
meeting. The persons who will be elected to the Board of Directors will be the
twenty-five nominees receiving the largest number of votes.
<PAGE>
<TABLE>
<CAPTION>
DIRECTOR OF
BUSINESS EXPERIENCE CORPORATION & DIRECTORSHIPS HELD
NAME AGE DURING THE LAST FIVE YEARS TRUSTMARK SINCE IN OTHER COMPANIES(1)
- ------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
J. Kelly Allgood 56 President, Mississippi 1991
Operations, BellSouth
Reuben V. Anderson 54 Partner, Phelps Dunbar, 1980 The Kroger Company
L.L.P.(Attorneys) BellSouth Corporation
John L. Black, Jr. 57 Chairman and Chief Executive 1990
Officer, The Waverley Group, Inc.
(Owns and Manages Nursing Home
Facilities)
Harry H. Bush 64 President, Bush Construction 1988
Company, Inc.; Senior Vice
President, Dunn & Bush
Construction, L.L.C.
(Road and Bridge Construction)
Robert P. Cooke III 62 Manages Personal and Family 1991
Investments
Frank R. Day 65 Chairman of the Board, President 1976
and Chief Executive Officer,
Trustmark Corporation; Chairman
of the Board and Chief Executive
Officer, Trustmark National Bank
William C. Deviney, Jr. 51 Chief Executive Officer and 1995
President, Deviney Construction
Company, Inc. (Telecommunications
Construction)
D. G. Fountain, Jr. 60 President, Fountain Construction 1980
Company, Inc. (Mechanical and
Electrical Contractors)
C. Gerald Garnett 52 Executive Vice President and 1993
Chief Executive Officer,
Southern Farm Bureau
Casualty Insurance Company and
Southern Farm Bureau Property
Insurance Company
</TABLE>
<PAGE>
<TABLE>
<S> <C> <C> <C>
Matthew L. Holleman III 45 President and Chief Executive 1994
Officer, Mississippi Valley Gas
Company (Natural Gas Distribution)
since October 1993; Executive
Vice President and Treasurer
from 1991 to 1993
Fred A. Jones 61 President, Columbus Manufacturers, 1994
Inc. (Mail Order Distributor);
President, Columbus Marble Works,
Inc. (Manufacturer of Marble and
Granite Monuments and License
Plates) since July 1994; Vice
President until July 1994
T. H. Kendall III 60 President and General Manager, 1971
The Gaddis Farms, Inc. (Farming,
Banking, Oil Production)
Larry L. Lambiotte 49 Co-Owner, Falco Lime, Inc. 1995
(Lime Sales)
Robert V. Massengill 57 President, Consulting Solutions, 1989
Inc. (Small Business Consulting)
since January 1996; Chairman of
the Advisory Board, Brookhaven
Branch, Trustmark National Bank
since December 1992; President,
Brookhaven Branch, Trustmark
National Bank from August 1987
to December 1992
Donald E. Meiners 61 President, Entergy Mississippi 1994
(formerly Mississippi Power &
Light Company) since January 1993;
President and Chief Operating
Officer, Mississippi Power & Light
Company from January 1992 to
January 1993
William Neville III 56 President, The Rogue and Good 1980
Company (Men's Clothing)
Richard H. Puckett 42 Chief Executive Officer and 1995
President, Puckett Machinery
Company, (Distributor of Heavy
Earth Moving Equipment) since
January 1992
</TABLE>
<PAGE>
<TABLE>
<S> <C> <C> <C>
Charles W. Renfrow 50 President, Renfrow Supply, Inc. 1995
(Supplier of Commercial and Resi-
dential Construction Material);
President, Renfrow Insulation, Inc.
(Commercial and Residential
Insulation)
Clyda S. Rent 54 President, Mississippi 1994
University for Women
William Thomas Shows 64 General Manager, Pearl River 1987
Valley Electric Power Association
Harry M. Walker 46 Secretary, Trustmark Corporation 1992
since January 1995; President and
Chief Operating Officer, Trustmark
National Bank since March 1992
LeRoy G. Walker, Jr. 47 President, LTM, Inc. 1995
(McDonald's Restaurant Franchises)
Paul H. Watson, Jr. 58 President, Farmers Tractor 1989
Company, Inc.
John C. Wheeless, Jr. 56 Senior Partner, Wheeless, Beanland, 1995
Shappley & Bailess, Attorneys
Allen Wood, Jr. 53 President and Chief Executive 1993
Officer, Scientific Tele-
communications, Inc. (Tele-
communications Equipment Sales
and Service)
</TABLE>
(1) Indicates other directorships in companies with a class of securities
registered pursuant to Section 12 of the Securities Exchange Act of 1934 or
subject to the requirements of Section 15(d) of that Act or any company
registered as an investment company under the Investment Company Act of
1940.
<PAGE>
III. APPROVAL OF TRUSTMARK CORPORATION 1997 LONG TERM
INCENTIVE PLAN
On January 14, 1997, the Board of Directors of the Corporation adopted the
Trustmark Corporation 1997 Long Term Incentive Plan (the "Plan") which is
subject to approval by the Corporation's shareholders. The Plan is attached
hereto as Exhibit A. The following summary of the Plan is qualified in its
entirety by reference to the Plan.
PURPOSE OF THE PLAN
The purpose of the Plan is to promote the long-term success of the
Corporation and its subsidiaries by providing select key employees of the
Corporation and its subsidiaries with the opportunity to acquire shares of the
common stock of the Corporation. By encouraging such stock ownership, the
Corporation seeks to attract, retain and motivate the best available personnel
for positions of substantial responsibility and to provide additional incentives
to key employees of the Corporation, Trustmark National Bank (the "Bank") and
their subsidiaries to promote the success of the Corporation.
DESCRIPTION OF THE PLAN
Effective Date. The Plan will become effective on the date of its approval
by the Corporation's shareholders (the "Effective Date").
Administration. The Plan shall be administered by the Executive
Compensation Committee (the "Committee"), appointed, from time to time, by the
Board of Directors. Each Member of the Committee must be a non-employee director
(within the meaning of Rule 16b-3 of the Securities Exchange Act of 1934, as
amended (the "Exchange Act")) and an outside director (within the meaning of the
U.S. Treasury Regulations promulgated under Section 162(m) of the Internal
Revenue Code of 1986, as amended (the "Code")). The Committee has discretionary
authority to select participants and grant awards, to determine the form and
content of awards to be made under the Plan, to interpret the Plan, to
prescribe, amend, and rescind rules and regulations relating to the Plan, and to
make other determinations necessary or advisable for the administration of the
Plan. The awards shall be subject to such terms and conditions as are
established by the Committee in a written agreement between the Corporation and
the recipient (the "Optionee") of the awards.
Types of Awards; Eligible Persons. Under the Plan, the Committee may grant
incentive and/or non-qualified stock options (collectively, "Options") to
selected key employees of the Corporation and its affiliates.
Shares Available For Grants. The Plan authorizes the granting of Options to
purchase up to 3,491,068 shares of the common stock of the Corporation;
provided, however, that Options granting no more than 1% of the Corporation's
outstanding shares (determined as
<PAGE>
of the last day of the fiscal year preceding the year of grant of the Option)
may be issued in any one fiscal year. In the event of any merger, consolidation,
recapitalization, reorganization, reclassification, stock split, stock dividend,
combination or exchange of shares, or similar event, the number and kind of
shares reserved for issuance under the Plan, the number and kind of shares
subject to outstanding Options and the exercise price thereof, shall be
proportionately adjusted.
Awards. Awards under the Plan may be either incentive stock options
("ISOs") as defined in Section 422 of the Code or options that are not ISOs
("NQSOs"). Unless otherwise expressly determined by the Committee, all Options
shall provide for vesting in four equal annual installments commencing on the
first anniversary of the date of grant. As required by federal tax law, to the
extent that the aggregate fair market value (determined when an ISO is granted)
of the common stock with respect to which ISOs are exercisable by an Optionee
for the first time during any calendar year (under all plans of the Corporation
and any subsidiary) exceeds $100,000, the Options granted in excess of $100,000
shall be treated as NQSOs. A participant may be granted multiple Options, but
the maximum number of shares with respect to which Options may be granted under
the Plan to any participant during any fiscal year is 45,000, subject to
adjustment for any merger, consolidation or similar reasons indicated above.
Exercise Price. The exercise price of each Option shall be determined by
the Committee but, in the case of an ISO, shall not be less than 100% of the
fair market value of the optioned shares on the date of grant. In the case of an
employee who owns shares representing more than 10% of the Corporation's
outstanding shares at the time an ISO is granted, the exercise price shall not
be less than 110% of the fair market value of the optioned shares at the time
the ISO is granted.
Exercise of Option. An Optionee may exercise Options, subject to provisions
relative to their termination and limitations on their exercise, only by payment
to the Corporation (contemporaneously with delivery of such notice) in cash, in
common stock, by authorizing the Corporation to withhold shares which would
otherwise be delivered upon exercise of the Option, in cash by a broker-dealer
acceptable to the Corporation, or a combination of cash and shares, of the
exercise price for the number of shares being purchased. Except as otherwise
provided in the agreement between the Corporation and the Optionee, an Option
may be exercised by an Optionee only during the period during which the Optionee
has maintained continuous service from the date of grant until 90 days after
termination of continuous service. In the event of the Optionee's death or
disability, the Option may be exercised within 90 days from the date of death or
date of termination of employment due to disability, as applicable. In no event;
however, may an Option be exercised later than the date it would otherwise
expire.
Change in Control. Notwithstanding the provisions of any Option which
provides for its exercise or vesting in installments,
<PAGE>
all Options shall, upon a "change in control," be fully vested and immediately
exercisable. At the time of a change in control, the Optionee shall, at the
discretion of the Committee, be entitled to receive cash in an amount equal to
the excess of the fair market value of the stock subject to the Option over the
exercise price of such shares, in exchange for the cancellation of such Options
by the Optionee.
For purposes of the Plan, "change in control" means any of the following
events: (i) the acquisition of ownership of, holding or power to vote more than
20% of the Corporation's voting stock, (ii) the acquisition of the ability to
control the election of a majority of the Corporation's Board, (iii) the
acquisition of a controlling influence over the management or policies of the
Corporation by any person or by persons acting as a "group" (within the meaning
of Section 13(d) of the Exchange Act), or (iv) during any period of two
consecutive years, individuals (the "Continuing Directors") who at the beginning
of such period constitute the Board (the "Existing Board") ceasing for any
reason to constitute at least two-thirds thereof, provided that any individual
whose election or nomination for election as a member of the Existing Board was
approved by a vote of at least two-thirds of the Continuing Directors then in
office shall be considered a Continuing Director. Notwithstanding the foregoing,
in the case of (i), (ii), and (iii) hereof, ownership or control of the
Corporation's voting stock by the Bank or any employee benefit plan sponsored by
the Corporation or the Bank shall not constitute a change in control.
Non-Transferability. Options may not be sold, pledged, assigned,
hypothecated, transferred, or disposed of in any manner other than by will or by
the laws of descent and distribution. Notwithstanding the foregoing, to the
extent permissible under Rule 16b-3 of the Exchange Act, a participant who
receives NQSOs may transfer such NQSOs to his or her spouse, lineal ascendants,
lineal descendants, or to trusts for their benefit ("Permitted Transferee"),
provided that NQSOs so transferred may not again be transferred other than to
the original participant or to a Permitted Transferee. NQSOs which are
transferred shall be exercisable by the transferee subject to the same terms and
conditions as would have applied to such NQSOs in the hands of the participant
originally receiving the grant.
Duration of the Plan and Grants. The Plan has a term of 10 years from the
Effective Date, after which date no Options may be granted. The maximum term of
an Option is 10 years from the date of grant, except that the maximum term of an
ISO may not exceed 5 years if the Optionee owns more than 10% of the common
stock of the Corporation on the date of grant.
Amendment and Termination of the Plan. The Board of Directors of the
Corporation may, from time to time, amend the terms of the Plan and, with
respect to any shares at the time not subject to Options, suspend or terminate
the Plan. No amendment, suspension, or termination of the Plan shall, without
the consent of any affected Optionee, alter or impair any rights or obligations
under any Option previously granted.
<PAGE>
FINANCIAL EFFECTS OF OPTIONS
The Corporation will receive no monetary consideration for the granting of
Options under the Plan. The Corporation will receive no monetary consideration
other than the option price for shares of common stock issued to Optionees upon
the exercise of their Options.
On January 21, 1997, the closing price of Trustmark Corporation common
stock was $25.50 per share.
PROPOSED GRANTS
Neither the Board of Directors nor the Committee has made any determination
as to whom Options under the Plan will be awarded or the amounts or forms
thereof.
FEDERAL INCOME TAX CONSEQUENCES
The following brief description of the tax consequences of Options under
the Plan is based on federal tax laws currently in effect and does not purport
to be a complete description of such federal tax consequences.
There are no federal tax consequences either to the Optionee or to the
Corporation upon the grant of an ISO or a NQSO. On the exercise of an ISO, the
Optionee will not recognize any income and the Corporation will not be entitled
to a deduction, although such exercise will be an item of tax preference in the
year of exercise by the Optionee for purposes of the alternative minimum tax.
Generally, if the Optionee disposes of shares acquired upon exercise of an ISO
within two years of the date of grant or one year of the date of exercise, the
Optionee will recognize ordinary income equal to the excess of the fair market
value of the shares on the date of exercise over the option price (limited
generally to the gain on the sale) and capital gain or loss based upon the
difference in the sales price and the market value on the exercise date. The
Corporation will be entitled to a deduction in the amount of ordinary income
recognized by the Optionee. The Corporation will not be entitled to any
deduction to the extent the gain or loss is treated as a capital gain or loss.
On the exercise of a NQSO, the excess of the date-of-exercise fair market
value of the shares acquired over the option price will generally be taxable to
the Optionee as ordinary income and deductible by the Corporation. The
disposition of shares acquired upon exercise of a NQSO will generally result in
a capital gain or loss for the Optionee, but will have no tax consequences for
the Corporation.
RECOMMENDATION AND VOTE REQUIRED
The Board of Directors has determined that the Plan is desirable, cost
effective, and produces incentives which will benefit the Corporation and its
shareholders. The Board of Directors is seeking shareholder approval of the Plan
pursuant to NASDAQ requirements and in order to satisfy the requirements of the
Code for favorable tax treatment of ISOs.
<PAGE>
Shareholder approval of the Plan requires the affirmative vote of the
holders of a majority of the votes cast at the meeting. The Board of Directors
recommends that shareholders vote "for" approval of the Plan.
IV. VOTING SECURITIES AND PRINCIPAL HOLDERS THEREOF
On January 24, 1997, the Corporation had outstanding 34,910,683 shares of
common stock, no par value, owned by approximately 5,200 shareholders. The
following is certain information about shareholders beneficially owning more
than five percent of the outstanding common stock of the Corporation.
Name and Address Amount and Nature of Percent
of Beneficial Owner Beneficial Ownership of Class
- ------------------- -------------------- --------
Capitol Street 2,053,787 5.88%
Corporation (1)
711 West Capitol Street
Jackson, MS 39207
Robert M. Hearin 3,818,692 10.94%
Foundation; Robert M.
Hearin Support
Foundation (2)
711 West Capitol Street
Jackson, MS 39207
Trustmark National 2,231,359 6.39%
Bank (3)
248 East Capitol Street
Jackson, MS 39201
(1) Includes 12,254 shares owned by a second tier subsidiary.
(2) Includes 191,964 shares owned by the Robert M. Hearin Foundation,
1,436,441 shares owned by the Robert M. Hearin Support Foundation,
2,041,533 shares owned by Capitol Street Corporation, 136,500 shares
owned by Bay Street Corporation and 12,254 shares owned by American
Federated Insurance Company, Inc. which is a second tier subsidiary
controlled by Capitol Street Corporation. Capitol Street Corporation
is a 100 percent owned subsidiary of Galaxie Corporation, which may be
deemed to be controlled by the Robert M. Hearin Support Foundation.
Does not include 254,427 shares held in the Mississippi Valley Gas
Company pension plan, since the Bank has voting and investment power
over these shares. Voting and investment decisions concerning shares
beneficially owned by the Robert M. Hearin Foundation and the Robert
M. Hearin Support Foundation are made by the Foundations' trustees:
Robert M. Hearin, Jr., Matthew L. Holleman III, Daisy S. Blackwell,
E.E. Laird, Jr., Laurie H. McRee and Alan W. Perry.
(3) Includes 91,867 shares owned by the Bank's 401(k) Plan, 142,129 shares
held in the Bank's Employee Stock Purchase Plan, 81,873 shares held in
the Bank's Retirement Plan and 1,915,490 shares held by the Bank's
Trust Department in various capacities in which the Bank has investment
or voting discretion. Although the Bank's Trust Department has voting
<PAGE>
and investment discretion with respect to the 1,915,490 shares held in
trust, it has declined to exercise this authority as a matter of
policy.
V. OWNERSHIP OF EQUITY SECURITIES BY MANAGEMENT
The table sets forth the beneficial ownership of the Corporation's common
shares as of January 24, 1997, by persons who are currently serving as
directors, persons nominated for election at the annual meeting and each of the
executive officers named in Section VI hereof. Also shown is ownership by all
directors and executive officers of the Corporation as a group. The persons
listed have sole voting and investment power as to all shares except as
indicated. The table below includes beneficial ownership in shares held by
officers as participants in the Bank's Employee Stock Purchase Plan. Percent of
outstanding shares of common stock owned is not shown where less than one
percent.
Amount and Percent of
Nature of Outstanding
Beneficial Shares of
Ownership of Common Stock
Name Common Stock Owned
- ---------------- ------------- ------------
J. Kelly Allgood 13,829
Reuben V. Anderson 9,136 (1)
John L. Black, Jr. 280,519 (1)(2)
Harry H. Bush 28,277 (1)
Robert P. Cooke III 61,384
Frank R. Day 1,618,845 (3) 4.64%
William C. Deviney, Jr. 1,500
D. G. Fountain, Jr. 114,400 (4)
C. Gerald Garnett 717,051 (5) 2.05%
Matthew L. Holleman III 3,838,131 (6) 10.99%
Gerard R. Host 9,705 (1)(7)
Fred A. Jones 223,359 (1)(8)
T. H. Kendall III 183,459 (1)(9)
Larry L. Lambiotte 53,100 (10)
Robert V. Massengill 41,220 (7)
Donald E. Meiners 250
Thomas W. Mullen 9,208 (1)(7)
William Neville III 76,040
Richard H. Puckett 122,254 (1)(11)
William O. Rainey 10,935 (7)
Charles W. Renfrow 136,000 (12)
Clyda S. Rent 400
William Thomas Shows 64,710 (1)
Harry M. Walker 23,696 (7)
LeRoy G. Walker, Jr. 500
Paul H. Watson, Jr. 11,196 (1)(13)
John C. Wheeless, Jr. 126,569
Allen Wood, Jr. 11,221 (1)
Above named persons and
executive officers of
Corporation as a group 7,786,894 22.31%
<PAGE>
(1) Includes shares owned by spouse and/or minor children.
(2) Includes 14,500 shares held in a private foundation for which nominee has
voting and investment authority.
(3) Includes 5,039 shares held for nominee in the Bank's Employee
Stock Purchase Plan and 135,636 shares owned by a charitable foundation
as to which nominee has one of five votes on investment and voting
decisions. Also, includes 52,722 shares held in the Bank's Employee Stock
Ownership Plan ("ESOP") as to which nominee has voting authority.
(4) Includes 80,700 shares owned by Fountain Construction Company for which
nominee has voting authority.
(5) Includes 677,551 shares owned by Southern Farm Bureau Casualty Insurance
Company and 36,000 shares owned by Southern Farm Bureau Casualty Insurance
Company Employee Retirement Plan and Trust for which nominee has shared
voting and investment authority.
(6) Includes 19,439 shares owned by nominee and immediate family members and
3,818,692 shares as to which nominee has shared investment and voting
authority as a result of serving as one of six trustees of the Robert M.
Hearin Foundation and the Robert M. Hearin Support Foundation, president
and director of Galaxie Corporation, president and director of Capitol
Street Corporation and president and director of Bay Street Corporation.
These shares are reported as beneficially owned by the Robert M. Hearin
Foundation and the Robert M. Hearin Support Foundation under Section IV.
(7) Includes shares held in the Bank's ESOP as to which nominee has voting
authority.
(8) Includes 17,361 shares owned by Columbus Manufacturers, Inc. and 4,668
shares owned by Quality Products, Inc., for which nominee has investment
and voting authority. Also includes 74,568 shares owned in trusts for
family members for which nominee's wife has voting and investment
authority.
(9) Includes 43,436 shares held as trustee for which nominee has shared voting
and/or investment authority. Also includes 66,028 shares owned by The
Gaddis Farms, Inc. and 38,821 shares owned by Gaddis & McLaurin, Inc. for
which nominee has voting authority.
(10) Includes 6,000 shares owned by Falco Lime, Inc. for which nominee has
voting and/or investment authority.
(11) Includes 45,000 shares owned by Puckett Machinery Company and 30,180 shares
held by Puckett Machinery Company Profit Sharing Plan for which nominee has
either sole or shared voting and investment authority.
(12) Includes 9,500 shares held by Renfrow Supply Company Profit Sharing Plan
for which nominee has either sole or shared voting and investment
authority.
(13) Includes 1,000 shares held in an estate for which nominee has voting and/or
investment authority.
<PAGE>
VI. COMPENSATION OF EXECUTIVE OFFICERS AND DIRECTORS
Executive Compensation
The following table shows the aggregate compensation for the last three
fiscal years paid by the Corporation and its subsidiary, Trustmark National
Bank, to the Corporation's Chief Executive Officer and to the Bank's four
highest compensated executive officers where compensation in the form of
salaries and bonuses exceeded $100,000 in 1996. For each named individual,
credited years of service under the Bank's pension plan is shown below. Deferred
compensation is included as salary in the year earned.
Years
Name and All Other of
Principal Position Year Salary Bonus(1) Compensation(2) Service
- ----------------------- ---- -------- -------- --------------- ---------
Frank R. Day 1996 $450,000 $450,000 $6,304 40
Chairman, President and 1995 450,000 300,000 5,581
Chief Executive Officer, 1994 400,000 150,000 5,717
Trustmark Corporation;
Chairman and Chief
Executive Officer,
Trustmark National Bank
Harry M. Walker 1996 $190,000 $100,000 $6,271 26
Secretary, 1995 170,000 70,000 5,552
Trustmark Corporation; 1994 160,000 56,000 5,687
President and Chief
Operating Officer,
Trustmark National Bank
Gerard R. Host 1996 $175,000 $90,000 $6,222 13
Treasurer, 1995 135,000 60,500 5,508
Trustmark Corporation; 1994 125,000 31,750 5,642
Executive Vice
President and Chief
Financial Officer,
Trustmark National Bank
William O. Rainey 1996 $138,500 $40,000 $6,230 15
Executive Vice 1995 135,500 33,875 5,516
President and Chief 1994 133,000 33,250 5,650
Banking Officer,
Trustmark National Bank
Thomas W. Mullen 1996 $128,500 $37,500 $6,226 14
Executive Vice 1995 123,500 30,875 5,512
President for Strategic 1994 121,000 30,250 5,646
Planning, Trustmark
National Bank
(1) Includes Business Development Incentive which was awarded in recognition of
special new business development achievements. Amounts paid did not exceed
$500 for any named individual in any year.
(2) Represents contributions under Profit Sharing Plan.
<PAGE>
The Bank maintains a noncontributory pension plan (the "Pension Plan") for
employees who are 21 years or older and who have completed one year of service
with a prescribed number of hours of credited service. The following table
specifies the estimated benefits payable upon retirement under the Pension Plan
to persons in the following remuneration and years of service classifications:
10 Year Average YEARS OF CREDITED SERVICE
Annual Earnings 15 20 25 30 35 40
- --------------- ------ ------ ------ ------ ------ -------
$ 50,000 $11,250 $15,000 $18,750 $22,500 $26,250 $ 30,000
75,000 18,074 24,099 30,124 36,149 42,173 47,798
100,000 26,137 34,849 43,561 52,274 60,986 68,486
125,000 34,199 45,599 56,999 68,399 79,798 89,173
150,000 42,262 56,349 70,436 84,524 98,611 109,861
Benefits payable under the Pension Plan are based on a formula that takes
into account the individual's average compensation over the highest consecutive
ten-year period and the number of years of credited service. Subject to the
benefit and compensation limits under federal law, the formula takes into
account all compensation, including salaries and bonuses. For the year 1996, the
compensation limit was $150,000 and the benefit limit was $120,000. Amounts
actually payable pursuant to the Pension Plan are not subject to deduction for
Social Security. The table assumes that the entire service period was completed
under the new benefit formula that is effective for service on or after January
1, 1989.
Compensation Committee Report on Executive Compensation
The Corporation's Executive Committee serves as the Compensation Committee
and, in such capacity, determines the compensation of the Corporation's
executive officers.
In establishing Mr. Day's salary for 1996, the Committee, without Mr. Day's
involvement, considered various factors. Using the Wyatt Survey of Financial
Institutions as a resource, the Committee considered the salaries of chief
executive officers in 22 financial institutions (the "Peer Group") located
primarily in the Southeastern United States with asset levels ranging from
approximately $3.2 billion to $16.8 billion. When compared to the aforementioned
survey data, it was determined that Mr. Day's 1995 base salary was competitive
with the Peer Group and therefore would remain the same for 1996. Five of the
bank holding companies included in the Peer Group are in the KBW 50 index and
the majority are included in the NASDAQ market index reflected in the
Performance Graph that follows.
In December 1996, the Board of Directors approved a discretionary bonus
pool of approximately $2.5 million. This amount was based upon the Corporation's
earnings for 1996 compared to prior years. After establishing a maximum bonus
for various categories of employees, including the chief executive officer, the
Committee awarded Mr. Day a bonus of $450,000. In awarding this bonus, the
Committee considered Mr. Day's performance based on
<PAGE>
various factors including traditional financial results and indicators such as
revenues, expenses, earnings and qualitative ratios. In addition, regulatory
compliance, competitive position and similar factors in the context of the
Corporation's historical performance and the performance of comparable
institutions were considered. These factors were not assigned specific weights
and no specific quantitative measures of performance were employed by the
Committee. The Committee determined that Mr. Day's performance in 1996 had been
exceptional, providing strong leadership and unique problem-solving capabilities
to the organization. Although the Corporation's common stock price rose during
1996, this was not a factor considered by the Committee in evaluating Mr. Day's
performance and establishing his bonus for 1996.
The Executive Committee established the salaries of the other executive
officers principally based upon Mr. Day's recommendations. The Committee and Mr.
Day also reviewed compensation reported in the Wyatt Survey for similar
positions at comparable financial institutions. Executive officers' salaries
were designed to be at levels necessary to attract and retain qualified
personnel.
Bonuses paid to executive officers were allocated by the Committee based
upon the recommendations of Management and the results of the formal performance
appraisal process which is used in establishing salaries and allocating bonuses
for all bank personnel. Factors considered included personal development, level
of job responsibility, achievement of work goals and management skills.
Executive Committee
-------------------
T. H. Kendall III, Chairman
Frank R. Day
D. G. Fountain, Jr.
C. Gerald Garnett
William F. Goodman, Jr.
William Neville III
Ben Puckett
Compensation Committee Interlocks and Insider Participation in
Compensation Decisions
The Executive Committee, which is composed of the persons previously
identified, performed as the Compensation Committee during 1996. Frank R. Day is
the only member of the Committee who is an officer or employee of the
Corporation or its subsidiaries. Mr. Goodman is a partner in a law firm which
was retained by the Corporation and the Bank during 1996 and which is
anticipated to be retained during 1997. During 1996, no executive officer of the
Corporation or any of its subsidiaries served as a member of the compensation
committee (or other board or committee performing similar functions) or the
board of directors of another entity, one of whose executive officers served on
the Executive Committee or the Board of Directors of the Corporation.
Compensation of Directors
Directors' meetings of the Corporation are held in conjunction with
meetings of the Board of Directors of the Bank. During 1996, each director and
each committee chairman received $750 and $1,000, respectively, for each board
meeting attended. Members of the
<PAGE>
Executive Committee were paid $1,875 per month. Pursuant to the Corporation's
Directors Deferred Fee Plan, the Corporation permits nonemployee Directors to
elect annually to defer up to 100% of fees to be earned. Generally, amounts
deferred are payable with interest to the participant in accordance with the
participant's agreement with the Corporation. Members of the Board who are
salaried officers of the Corporation or the Bank are not paid directors' fees.
Performance Graph
The following graph compares the Corporation's annual percentage change in
cumulative total return on common shares over the past five years with the
cumulative total return of companies comprising the NASDAQ market value index
and the KBW 50 Total Return Index. The KBW 50 is an industry index prepared by
Keefe, Bruyette and Woods, Inc. and consists of 50 bank holding companies,
including all money-center and most major regional bank holding companies.
This presentation assumes that $100 was invested in shares of the relevant
issuers on December 31, 1991, and that dividends received were immediately
invested in additional shares. The graph plots the value of the initial $100
investment at one-year intervals.
FIVE YEAR CUMULATIVE TOTAL RETURN
----------------------FISCAL YEAR ENDING-------------------------
COMPANY 1991 1992 1993 1994 1995 1996
-----------------------------------------------------------------
Trustmark Corp. 100 168.29 190.45 235.29 313.75 359.46
KBW 50 100 127.42 134.48 127.62 204.41 289.15
NASDAQ Market 100 100.98 121.13 127.17 164.96 204.98
VII. TRANSACTIONS WITH MANAGEMENT
No executive officer, director, nominee, their related entities or their
immediate family members have been indebted to the Corporation, or any
subsidiaries, other than the Bank, at any time since January 1, 1996. In the
ordinary course of business the Bank has had, and expects to have in the future,
banking transactions (including loans and other transactions) in excess of
$60,000 with executive officers, directors, nominees, related entities and
immediate family members. Such loans and other banking transactions are made on
substantially the same terms, including interest rates and collateral, as those
prevailing at the time for comparable transactions with other persons. None of
the loans involved more than the normal risks of collectibility and presented no
other unfavorable features.
During 1996, the R. M. Hearin Support Foundation, the Robert M. Hearin
Foundation and corporations directly and indirectly controlled by them
(including Bay Street Corporation, Galaxie Corporation, Capitol Street
Corporation, Southland Oil Company, Mississippi Valley Gas Company and
Mississippi Energies) loaned money to the Bank through the purchase of
government securities pursuant to repurchase agreements. Director Matthew L.
Holleman III is affiliated in various capacities with the aforementioned
entities. A total of 1,333 repurchase transactions averaging $2,606,821 was
conducted with these parties. Additionally, the Bank engaged in 15 securities
sales averaging $1,103,210 with these
<PAGE>
entities. The Bank entered into 65 repurchase transactions averaging $3,148,023
with Fountain Construction Company, Inc., which is owned by director D. G.
Fountain, Jr., 354 repurchase transactions averaging $3,343,712 with Deviney
Construction Company, Inc., which is owned by director William C. Deviney, Jr.
and 296 repurchase transactions averaging $1,076,084 with Pearl River Valley
Electric Power Association, for which director William T. Shows serves as Chief
Executive Officer. The Bank entered into federal funds transactions and
securities transactions with Merchants and Planters Bank of Raymond, which is
controlled by director T. H. Kendall III; Smith County Bank, in which Mr. Day
has a significant ownership interest; and Perry County Bank, in which director
Matthew L. Holleman III is affiliated and in which the Robert M. Hearin Support
Foundation has a significant ownership interest. These transactions included 13
securities sales averaging $225,534 to Merchants and Planters Bank of Raymond,
16 securities sales averaging $1,056,797 to Smith County Bank and 4 securities
sales averaging $505,710 to Perry County Bank. All transactions with these
entities were on prevailing terms. Other members of Management and their related
entities purchased and sold investment securities through the Bank and Trustmark
Financial Services, Inc. (a wholly-owned subsidiary of the Bank) and
periodically engaged in repurchase and other similar transactions with the Bank;
however, these transactions are not, in the opinion of Management, material to
either the Bank or the related entities. For the year 1996, Scientific
Telecommunications, Inc., a company controlled by director Allen Wood, Jr., was
paid $624,388 for telecommunications equipment and services.
Reuben V. Anderson is a partner in the law firm of Phelps Dunbar, L.L.P.
and John C. Wheeless, Jr. is a partner in the law firm of Wheeless, Beanland,
Shappley and Bailess. Each of these firms was retained by the Corporation or the
Bank on various legal matters during 1996 and it is anticipated that these firms
will be retained during 1997.
During 1996, the Bank engaged in business relationships with various
entities in which members of Management have direct and indirect interests. None
of these relationships was considered material to the Bank or such entity.
VIII. OTHER INFORMATION CONCERNING DIRECTORS
During 1996, the Corporation had an Audit Committee composed of J. Kelly
Allgood, Chairman, Harry H. Bush, Fred A. Jones, Richard H. Puckett, Paul H.
Watson, Jr., Allen Wood, Jr., and Advisory Director William K. Ray. This
Committee, which conducts the usual and necessary activities in connection with
the audit functions of the Corporation, held eight meetings during 1996.
There were eleven meetings of the Board of Directors held during 1996. Of
those directors serving during 1996, none attended fewer than 75 percent of the
Board meetings and meetings of those committees of which they were members.
IX. SECTION 16(a) BENEFICIAL REPORTING COMPLIANCE
Directors, certain officers of the Corporation and its subsidiaries, and
holders of more than 10 percent of the Corporation's outstanding shares are
required to file reports under Section 16 of the Securities Exchange Act of
1934. Federal regulations require disclosure of any failures to file these
reports on a timely basis. The Corporation believes that during 1996 its
officers, directors, and greater than 10 percent beneficial owners complied with
all filing requirements.
<PAGE>
X. INDEPENDENT PUBLIC ACCOUNTANTS
It is the intention of the Board of Directors to employ the services of
Arthur Andersen LLP, independent accountants for the Corporation during the most
recently completed fiscal year, as independent accountants for the Corporation
for the year 1997. Representatives of Arthur Andersen LLP are expected to be
present at the shareholders' meeting with the opportunity to make a statement,
if they desire to do so, and to be available to respond to appropriate and
proper questions during the period generally allotted for questions at the
meeting.
XI. PROPOSALS OF SHAREHOLDERS
In order for a shareholder proposal to be included in a proxy statement and
form of proxy prepared by the Board of Directors, it must meet the requirements
of Rule 14a-8 of the Securities Exchange Act of 1934 and be received at the
principal executive offices of the Corporation not less than 120 days in advance
of the date the previous year's proxy statement and form of proxy were mailed to
shareholders. Thus, a shareholder proposal must be received before October 17,
1997 in order to be included in the proxy statement and form of proxy for the
1998 annual meeting.
BY ORDER OF THE BOARD OF DIRECTORS.
/s/ Frank R. Day
-----------------
Chairman
<PAGE>
EXHIBIT A
TRUSTMARK CORPORATION
1997 LONG TERM INCENTIVE PLAN
1. PURPOSE OF THE PLAN.
The name of this Plan is the Trustmark Corporation 1997 Long Term Incentive Plan
(the "Plan"). The purpose of the Plan is to promote the long-term success of
Trustmark Corporation (the "Corporation") and its subsidiaries by providing
select key employees of the Corporation and its subsidiaries with the
opportunity to acquire shares of common stock of the Corporation. By encouraging
such stock ownership, the Corporation seeks to attract, retain and motivate the
best available personnel for positions of substantial responsibility and to
provide additional incentives to key employees of the Corporation, Trustmark
National Bank (the "Bank") and their subsidiaries to promote the success of the
business.
2. DEFINITIONS.
For purposes of this Plan, the following terms shall have the meanings set forth
below:
(a) "Affiliate" means any "parent corporation" or "subsidiary corporation" of
the Corporation, as such terms are defined in Section 424(e) and (f),
respectively, of the Code.
(b) "Agreement" means a written agreement entered into in accordance with
Section 5(c).
(c) "Award" means an Option.
(d) "Bank" means Trustmark National Bank, a national banking association.
(e) "Board" means the Board of Directors of the Corporation.
(f) "Change in Control" means any one of the following events: (i) the
acquisition of ownership of, holding or power to vote more than 20% of the
Corporation's voting stock, (ii) the acquisition of the ability to control the
election of a majority of the Corporation's Board, (iii) the acquisition of a
controlling influence over the management or policies of the Corporation by any
person or by persons acting as a "group" (within the meaning of Section 13(d) of
the Exchange Act), or (iv) during any period of two consecutive years,
individuals (the "Continuing Directors") who at the beginning of such period
constitute the Board (the "Existing Board") cease for any reason to constitute
at least two-thirds thereof, provided that any individual whose election or
nomination for election as a member of the Existing Board was approved by a vote
of at least two-thirds of the Continuing Directors then in office shall be
considered a Continuing Director. Notwithstanding the foregoing, in the case of
(i), (ii) and (iii) hereof, ownership or control of the Corporation's voting
stock by the Bank or any employee benefit plan sponsored by the Corporation or
the Bank shall not constitute a Change in Control. For purposes of this
paragraph only, the term "person" refers to an individual or a corporation,
partnership, trust, association, joint venture, pool, syndicate, sole
proprietorship, unincorporated organization of any other form of entity not
specifically listed herein.
<PAGE>
(g) "Code" means the Internal Revenue Code of 1986, as amended from time to
time.
(h) "Committee" means the Executive Compensation Committee appointed by the
Board from time to time, which shall consist of Directors, each of whom shall be
both a Non-Employee Director and an Outside Director.
(i) "Common Stock" means the common stock of the Corporation.
(j) "Continuous Service" means the absence of any interruption or termination
of service as an Employee of the Corporation or an Affiliate. Continuous Service
shall not be considered interrupted in the case of sick leave, military leave or
any other leave of absence approved by the Corporation, in the case of transfers
between payroll locations of the Corporation or between the Corporation, an
Affiliate or a successor.
(k) "Corporation" means Trustmark Corporation.
(l) "Director" means any member of the Board.
(m) "Disability" means a physical or mental condition, which in the sole and
absolute discretion of the Committee, is reasonably expected to be of indefinite
duration and to substantially prevent a Participant from fulfilling his or her
duties or responsibilities to the Corporation or an Affiliate.
(n) "Effective Date" means the date specified in Section 13 hereof.
(o) "Employee" means any person employed by the Corporation or an Affiliate.
(p) "Exchange Act" means the Securities Exchange Act of 1934, as amended from
time to time.
(q) "Executive Officer" means a person holding one of the offices enumerated in
Rule 16a-1(f) of the Exchange Act.
(r) "Exercise Price" means the price per Optioned Share at which an Option may
be exercised.
(s) "ISO" means an option to purchase Common Stock which meets the requirements
set forth in the Plan, and which is intended to be and is identified as an
"incentive stock option" within the meaning of Section 422 of the Code.
(t) "Market Value" means the fair market value of the Common Stock, as
determined under Paragraph 7(b) hereof.
(u) "Non-Employee Director" has the meaning provided in Rule 16b-3 of the
Exchange Act.
(v) "NQSO" means an option to purchase Common Stock which meets the
requirements set forth in the Plan but which is not intended to be and is not
is not identified as an ISO.
(w) "Option" means an ISO and/or NQSO.
<PAGE>
(x) "Optioned Shares" means Shares subject to an Award granted pursuant to this
Plan.
(y) "Outside Director" has the meaning provided in the U.S.Treasury Regulations
promulgated under Section 162(m) of the Code.
(z) "Participant" means any person who receives an Award pursuant to the Plan.
(aa) "Plan" means this Trustmark Corporation Long Term Incentive Plan.
(bb) "Rule 16b-3" means Rule 16b-3 of the Exchange Act.
(cc) "SEC" means the Securities and Exchange Commission.
(dd) "Share" means one share of Common Stock.
3. TERM OF THE PLAN AND AWARDS.
(a) Term of the Plan. The Plan shall continue in effect for a term of ten years
from the Effective Date, unless sooner terminated pursuant to Section 15 hereof.
No Award shall be granted under the Plan after ten years from the Effective
Date.
(b) Term of Awards. The term of each Award granted under the Plan shall be
established by the Committee, but shall not exceed 10 years; provided, however,
that in the case of an Employee who owns Shares representing more than 10% of
the Corporation's outstanding Common Stock at the time an ISO is granted, the
term of such ISO shall not exceed five years.
4. SHARES SUBJECT TO THE PLAN.
Except as otherwise required under Section 10, the aggregate number of Shares
deliverable pursuant to Awards shall not exceed 3,491,068 Shares, provided,
however, that Awards granting no more than 1% of the Corporation's outstanding
Shares (determined as of the last day of the fiscal year preceding the year of
grant of the Award) may be issued in any one fiscal year. Such Shares may either
be authorized but unissued Shares, Shares held in treasury, or Shares held in a
grantor trust created by the Corporation. If any Awards should expire, become
unexercisable, or be forfeited for any reason without having been exercised, the
Optioned Shares shall, unless the Plan shall have been terminated, be available
for the grant of additional Awards under the Plan. For purposes of this Section
4, the aggregate number of Shares that may be issued at any time pursuant to
Awards granted under the Plan shall be reduced by: (i) the number of Shares
previously issued pursuant to Awards granted under the Plan, other than Shares
subsequently reacquired by the Corporation pursuant to the terms and conditions
of such Awards and with respect to which the holder thereof receives no future
benefits of ownership, such as dividends; and (ii) the number of Shares which
were otherwise issuable pursuant to Awards granted under this Plan but which
were withheld by the Corporation as payment of the purchase price of the Common
Stock issued pursuant to such Awards or as payment of the recipient's tax
withholding obligation with respect to such issuance.
<PAGE>
5. ADMINISTRATION OF THE PLAN.
(a) Administration. The Plan shall be administered by the Committee.
(b) Powers of the Committee. Except as limited by the express provisions of the
Plan or by resolutions adopted by the Board, the Committee shall have sole and
complete authority and discretion (i) to select Participants and grant Awards,
(ii) to determine the form and content of Awards to be issued and evidenced by
Agreements under the Plan, (iii) to interpret the Plan, (iv) to prescribe, amend
and rescind rules and regulations relating to the Plan, and (v) to make other
determinations necessary or advisable for the administration of the Plan. The
Committee shall have and may exercise such other power and authority as may be
delegated to it by the Board from time to time. A majority of the entire
Committee shall constitute a quorum and the action of a majority of the members
present at any meeting at which a quorum is present, or acts approved in writing
by a majority of the Committee without a meeting, shall be deemed the action of
the Committee.
(c) Agreement. Each Award shall be evidenced by an Agreement containing such
provisions as may be approved by the Committee. Each such Agreement shall
constitute a binding contract between the Corporation and the Participant, and
every Participant, upon acceptance of such Agreement, shall be bound by the
terms and restrictions of the Plan and of such Agreement. The terms of each such
Agreement shall be in accordance with the Plan, but each Agreement may include
such additional provisions and restrictions determined by the Committee, in its
discretion, provided that such additional provisions and restrictions are not
inconsistent with the terms of the Plan. In particular, the Committee shall set
forth in each Agreement (i) the Exercise Price of an Option, (ii) the number of
Shares subject to, and the expiration date of, the Award, (iii) the manner, time
and rate (cumulative or otherwise) of exercise or vesting of such Award, and
(iv) the restrictions, if any, to be placed upon such Award, or upon Shares
which may be issued upon exercise of such Award.
The Chairman of the Committee and such other Directors and officers as shall be
designated by the Committee are hereby authorized to execute Agreements on
behalf of the Corporation and to cause them to be delivered to the recipients of
Awards.
(d) Effect of the Committee's Decisions. All decisions, determinations and
interpretations of the Committee shall be final and conclusive on all persons
affected thereby.
(e) Indemnification. In addition to such other rights of indemnification as they
may have, the members of the Committee shall be indemnified by the Corporation
in connection with any claim, action, suit, expense (including attorneys fees)
or proceeding relating to any action taken or failure to act under or in
connection with the Plan or any Award granted hereunder to the
<PAGE>
full extent provided for under the Corporation's governing instruments with
respect to the indemnification of Directors.
6. GRANT OF OPTIONS.
(a) General Rule. The Committee shall have the discretion to make Awards to
Employees. In selecting those Employees to whom Awards will be granted and the
number of Shares covered by such Awards, the Committee shall consider the
position, duties and responsibilities of the eligible Employees, the value of
their services to the Corporation and its Affiliates, and any other factors the
Committee may deem relevant.
(b) Vesting. The Committee may determine that all or a portion of any Award
granted to a Participant shall vest at such times and upon such terms as may be
selected by the Committee in its sole discretion; provided, however, that unless
otherwise expressly determined by the Committee, all Awards granted to Employees
shall provide for vesting in four equal annual installments commencing on the
first anniversary of the date of grant of such Award.
(c) Special Rules for ISOs. The aggregate Market Value, as of the date the
Option is granted, of the Shares with respect to which ISOs are exercisable for
the first time by an Employee during any calendar year (under all incentive
stock option plans, as defined in Section 422 of the Code, of the Corporation or
any present or future Affiliate of the Corporation) shall not exceed $100,000.
Notwithstanding the foregoing, the Committee may grant Options in excess of the
foregoing limitations, in which case such Options granted in excess of such
limitation shall be Options which are NQSOs. Each Option, or portion thereof,
that is not an ISO shall be a NQSO.
(d) Maximum Awards. A Participant may be granted multiple Awards under the Plan.
However, notwithstanding any other provision of this Plan, the maximum number of
Shares with respect to which Options may be granted under the Plan to any
Participant during any fiscal year shall be 45,000, subject to adjustment as
provided in Section 10 hereof.
7. EXERCISE PRICE FOR OPTIONS.
(a) Limits on Committee Discretion. The Exercise Price as to any particular
Option shall be determined by the Committee but, in the case of an ISO, shall
not be less than 100% of the Market Value of the Optioned Shares on the date of
grant. In the case of an Employee who owns Shares representing more than 10% of
the Corporation's outstanding Shares at the time an ISO is granted, the Exercise
Price shall not be less than 110% of the Market Value of the Optioned Shares at
the time the ISO is granted.
(b) Standards for Determining Exercise Price. If the Common Stock is listed on a
national securities exchange (including the NASDAQ National Market System) on
the date in question, then the Market Value per Share shall be the average of
the highest and lowest selling price on such exchange on such date, or if there
were no
<PAGE>
sales on such date, then the Exercise Price shall be the mean between the bid
and asked price on such date. If the Common Stock is traded otherwise than on a
national securities exchange on the date in question, then the Market Value per
Share shall be the mean between the bid and asked price on such date, or, if
there is no bid and asked price on such date, then on the next prior business
day on which there was a bid and asked price. If no such bid and asked price is
available, then the Market Value per Share shall be its fair market value as
determined by the Committee, in its sole and absolute discretion.
8. EXERCISE OF OPTION.
(a) Generally. The Committee shall determine whether an Option shall become
exercisable in cumulative or non-cumulative installments or in part or in full
at any time. An Option may be exercised only with respect to whole Shares.
(b) Procedure for Exercise. A Participant may exercise Options, subject to
provisions relative to its termination and limitations on its exercise, only by
(1) written notice of intent to exercise the Option with respect to a specified
number of Shares, and (2) payment to the Corporation (contemporaneously with
delivery of such notice)(i) in cash, (ii) in Common Stock, (iii) by authorizing
the Corporation to withhold whole Shares which would otherwise be delivered upon
exercise of the Option, (iv) in cash by a broker-dealer acceptable to the
Corporation to whom the Participant has submitted an irrevocable notice of
exercise or (v) a combination of (i), (ii) and (iii), in each case to the extent
determined by the Committee at the time the Option is granted, in the amount of
the Exercise Price for the number of Shares with respect to which the Option is
then being exercised. The Committee shall have sole discretion to disapprove of
an election pursuant to any of clauses (ii)-(v) in the preceding sentence and,
in the case of a Participant who is subject to Section 16 of the Exchange Act,
the Corporation may require that the method of making such payment be in
compliance with Section 16 of the Exchange Act and the rules and regulations
thereunder. Each such notice (and payment where required) shall be delivered, or
mailed by prepaid registered or certified mail, addressed to the Personnel
Director of the Corporation at its executive offices. Common Stock utilized in
full or partial payment of the Exercise Price for Options shall be valued at its
Market Value at the date of exercise, and may consist of Shares subject to the
Option being exercised.
(c) Period of Exercisability for ISOs. Except to the extent otherwise provided
in the terms of an Agreement, an ISO may be exercised by a Participant only
while he is an Employee and has maintained Continuous Service from the date of
the grant of the ISO, or within three months after termination of such
Continuous Service (but not later than the date on which the ISO would otherwise
expire), except if the Employee's Continuous Service terminates by reason of the
following:
(1) Death, then to the extent that the Employee would have been entitled to
exercise the ISO immediately prior to his death, such
<PAGE>
ISO of the deceased Employee may be exercised within 90 days from the date of
his death (but not later than the date on which the ISO would otherwise expire)
by the personal representatives of his estate or person or persons to whom his
rights under such ISO shall have passed by Will or by laws of descent and
distribution; or
(2) Disability, then to the extent that the Employee would have been entitled to
exercise the ISO immediately prior to his or her Disability, such ISO may be
exercised within 90 days from the date of termination of employment due to
Disability, but not later than the date on which the ISO would otherwise expire.
(d) Period of Exercisability for NQSOs. Except as otherwise provided in an
Agreement, a NQSO may be exercised by a Participant only during the period
during which he has maintained Continuous Service from the date of grant of the
NQSO, provided that such NQSO shall continue to be exercisable for 90 days
following his termination of Continuous Service for any reason. In the event of
the Participant's death, then to the extent that the Participant would have been
entitled to exercise the NQSO immediately prior to his death, such NQSO of the
deceased Participant may be exercised within 90 days from the date of his death
(but not later than the date on which the NQSO would otherwise expire) by the
personal representatives of his estate or person or persons to whom his rights
under such NQSO shall have passed by Will or by laws of descent and
distribution. Notwithstanding the foregoing, a NQSO may not be exercised later
than the date on which the NQSO would otherwise expire.
(e) Suspension or Termination of Awards. If the Committee determines that a
Participant has committed an act of personal dishonesty, embezzlement, fraud,
non-payment of any obligation owed to the Corporation or any Affiliate, breach
of fiduciary duty or deliberate disregard of any rule of the Corporation or any
Affiliate, willful misconduct, intentional failure to perform stated duties,
willful violation of any law, rule or regulation (other than misdemeanors,
traffic violations or similar offenses) or final cease-and-desist order, or if a
Participant makes an unauthorized disclosure of trade secret or confidential
information of the Corporation or any Affiliate, engages in any conduct
constituting unfair competition, or induces any customer of the Corporation or
any Affiliate to breach a contract with the Corporation or any Affiliate, the
Committee may terminate the Participant's rights under any then outstanding
Award.
(f) Effect of the Committee's Decisions. The Committee's determination on any
matter concerning this Plan or an Award, and the effective date thereof, shall
be final and conclusive on all persons affected thereby.
9. CHANGE IN CONTROL.
Notwithstanding the provisions of any Award which provides for its exercise or
vesting in installments, all Options shall upon a Change in Control be fully
vested and immediately exercisable. Unless otherwise expressly determined by the
Committee, each Award
<PAGE>
shall provide that each Participant shall be provided with written notice of an
imminent Change in Control and shall have the right during a thirty-day period
ending on the fifth day prior to such Change in Control to exercise his or her
Award, in whole or in part, without regard to any installment provisions under
his or her Agreement; provided, however, that the Participant shall not be
deemed to have exercised his or her Award until immediately prior to a Change in
Control; provided, further, that the effectiveness of such exercise may be
conditioned upon the actual occurrence of such Change in Control; provided,
further, that the ability to exercise any Award which, except for the occurrence
of a Change in Control, would not then be exercisable, shall be conditioned upon
the actual occurrence of such Change in Control, and if such Change in Control
is abandoned or otherwise does not occur, the Participant's exercise of the
Award during such ten-day period shall be null and void; provided, further, that
the Participant shall not be obligated to deliver the Exercise Price, if any,
until he or she is informed by the Committee that such delivery is required
(which notice shall be given no less than 24 hours prior to the required
delivery time) and if any Change in Control is abandoned or otherwise does not
occur, the Corporation will return such Exercise Price to the Participant
without penalty or interest; provided, further, that if the Participant effects
such exercise by delivery of Shares and/or other property issuable pursuant to
an Award, such Shares and/or other property shall be held in escrow by the
Corporation until the consummation of the Change in Control; and if such Change
in Control is abandoned or otherwise does not occur, the Corporation will return
such Shares and/or other property to the Participant without penalty or
interest. At the time of a Change in Control, the Participant shall, at the
discretion of the Committee, be entitled to receive cash in an amount equal to
the excess of the Market Value of the Common Stock subject to the Option over
the Exercise Price thereof, in exchange for the cancellation of such Options by
the Participant.
10. EFFECT OF CHANGES IN COMMON STOCK SUBJECT TO THE PLAN.
(a) Recapitalizations; Stock Splits, Etc. The number and kind of Shares reserved
for issuance under the Plan, and the number and kind of Shares subject to
outstanding Awards, and the Exercise Price thereof, shall be proportionately
adjusted for any increase, decrease, change or exchange of Shares for a
different number or kind of Shares or other securities of the Corporation which
results from a merger, consolidation, recapitalization, reorganization,
reclassification, stock split, stock dividend, combination or exchange of
shares, or similar event in which the number or kind of Shares is changed
without the receipt or payment of consideration by the Corporation.
(b) Other Transactions. In the event of a merger, reorganization or
consolidation in which the stockholders of the Corporation receive shares in
another entity (referred to herein as a "Transaction"), all outstanding Awards,
together with the Exercise Prices thereof, shall be equitably adjusted for any
change or exchange of Shares for a different number or kind of Shares or other
securities which results from the Transaction.
<PAGE>
(c) Special Rule for ISOs. Any adjustment made pursuant to subparagraphs (a) or
(b) hereof shall be made in such manner as not to constitute a modification,
within the meaning of Section 424(h) of the Code, of outstanding ISOs.
(d) Conditions and Restrictions on New, Additional, Different Shares or
Securities. If, by reason of any adjustment made pursuant to this Section, a
Participant becomes entitled to new, additional, or different shares of stock or
securities, such new, additional, or different shares of stock or securities
shall thereupon be subject to all of the conditions and restrictions which were
applicable to the Shares pursuant to the Award before the adjustment was made.
(e) Other Issuances. Except as expressly provided in this Section, the issuance
by the Corporation or an Affiliate of shares of stock of any class, or of
securities convertible into shares or stock of another class, for cash or
property or for labor or services either upon direct sale or upon the exercise
of rights or warrants to subscribe therefor, shall not affect, and no adjustment
shall be made with respect to, the number, class, or Exercise Price of Shares
then subject to Awards or reserved for issuance under the Plan.
11. NON-TRANSFERABILITY OF AWARDS.
Awards may not be sold, pledged, assigned, hypothecated, transferred or disposed
of in any manner other than by Will or by the laws of descent and distribution.
Upon any attempt to sell, pledge, assign, hypothecate, transfer or dispose of
any Award, such Award and all rights thereunder shall immediately become null
and void. Notwithstanding any other provision of this Plan to the contrary, to
the extent permissible under Rule 16b-3 of the Exchange Act, a Participant who
is granted NQSOs pursuant to this Plan may transfer such NQSOs to his or her
spouse, lineal ascendants, lineal descendants, or to trusts for their benefit,
provided that NQSOs so transferred may not again be transferred other than to
the Participant originally receiving the grant of NQSOs or to an individual or
trust to whom such Participant could have transferred NQSOs pursuant to this
Section 11. NQSOs which are transferred pursuant to this Section 11 shall be
exercisable by the transferee subject to the same terms and conditions as would
have applied to such NQSOs in the hands of the Participant originally receiving
the grant of such NQSOs.
12. TIME OF GRANTING AWARDS.
The date of grant of an Award shall, for all purposes, be the later of the date
on which the Committee makes the determination of granting such Award or the
Effective Date. Notice of the determination shall be given to each Participant
to whom an Award is so granted within a reasonable time after the date of such
grant.
<PAGE>
13. EFFECTIVE DATE.
This Plan shall become effective immediately upon its approval by a favorable
vote of stockholders owning at least a majority of the total votes cast at a
duly called meeting of the Corporation's stockholders held in accordance with
applicable laws. No Awards may be made prior to approval of the Plan by the
stockholders of the Corporation.
14. MODIFICATION OF AWARDS.
At any time, and from time to time, the Board may authorize the Committee to
direct execution of an instrument providing for the modification of any
outstanding Award, provided no such modification shall (i) confer on the holder
of said Award any right or benefit which could not be conferred on him by the
grant of a new Award at such time, or (ii) impair the Award without the consent
of the holder of the Award.
15. AMENDMENT AND TERMINATION OF THE PLAN.
The Board may from time to time amend the terms of the Plan and, with respect to
any Shares at the time not subject to Awards, suspend or terminate the Plan. No
amendment, suspension or termination of the Plan shall, without the consent of
any affected holders of an Award, alter or impair any rights or obligations
under any Award theretofore granted.
16. CONDITIONS UPON ISSUANCE OF SHARES.
(a) Compliance With Securities Laws. Shares of Common Stock shall not be issued
with respect to any Award unless the issuance and delivery of such Shares shall
comply with all relevant provisions of law, including, without limitation, the
Securities Act of 1933, as amended, the rules and regulations promulgated
thereunder, any applicable state securities law, and the requirements of any
stock exchange upon which the Shares may then be listed.
(b) Special Circumstances. The inability of the Corporation to obtain approval
from any regulatory body or authority deemed by the Corporation's counsel to be
necessary to the lawful issuance and sale of any Shares hereunder shall relieve
the Corporation of any liability in respect of the non-issuance or sale of such
Shares. As a condition to the exercise of an Option, the Corporation may require
the person exercising the Option to make such representations and warranties as
may be necessary to assure the availability of an exemption from the
registration requirements of federal or state securities laws.
(c) Committee Discretion. The Committee shall have the discretionary authority
to impose in Agreements such restrictions on Shares as it may deem appropriate
or desirable, including but not limited to the authority to impose a right of
first refusal or to establish repurchase rights or both of these restrictions.
<PAGE>
17. RESERVATION OF SHARES.
The Corporation, during the term of the Plan, will reserve and keep available a
number of Shares sufficient to satisfy the requirements of the Plan.
18. WITHHOLDING TAX.
The Corporation's obligation to deliver Shares upon exercise of Options shall be
subject to the Participant's satisfaction of all applicable federal, state and
local income and employment tax withholding obligations. The Committee, in its
discretion, may permit the Participant to satisfy the obligation, in whole or in
part, by irrevocably electing to have the Corporation withhold Shares, or to
deliver to the Corporation Shares that he already owns, having a value equal to
the amount required to be withheld. The value of the Shares to be withheld, or
delivered to the Corporation, shall be based on the Market Value of the Shares
on the date the amount of tax to be withheld is to be determined. As an
alternative, the Corporation may retain, or sell without notice, a number of
such Shares sufficient to cover the amount required to be withheld.
19. NO EMPLOYMENT OR OTHER RIGHTS.
In no event shall an Employee's eligibility to participate or participation in
the Plan create or be deemed to create any legal or equitable right of the
Employee or any other party to continue service with the Corporation, the Bank,
or any Affiliate. No Employee shall have a right to be granted an Award or,
having received an Award, the right to again be granted an Award. However, an
Employee who has been granted an Award may, if otherwise eligible, be granted an
additional Award or Awards.
20. RIGHTS AS STOCKHOLDER.
No person shall have any rights as a holder of Common Stock with respect to
Awards or Options hereunder, unless and until such person becomes a stockholder
of record with respect to such Common Stock.
21. GOVERNING LAW.
This Plan and each Award and Option granted hereunder shall be governed by and
construed in accordance with the laws of the State of Mississippi, except to the
extent that federal law shall be deemed to apply.
<PAGE>
APPENDIX 1
PROXY CARD
TRUSTMARK CORPORATION
POST OFFICE BOX 291 JACKSON, MISSISSIPPI 39205-0291
This Proxy is Solicited on Behalf of the Board of Directors for the Annual
Meeting of Shareholders on March 11, 1997.
The undersigned, having received Notice of Meeting and Proxy Statement dated
February 14, 1997, appoint D. G. Fountain, Jr., T. H. Kendall III and William
Neville III and each or any of them as proxies, with full power of substitution
and revocation, to represent the undersigned and to vote all shares of the
Common Stock of Trustmark Corporation which the undersigned is entitled to vote
at the Annual Meeting of the Shareholders of the Corporation to be held on March
11, 1997, in Ballroom "A" of the Ramada Plaza Hotel, located at Interstate 55
North and County Line Road, in Jackson, Mississippi, at 10:00 A.M., local time,
and any adjournment thereof, as follows:
1. Election of Directors
J. Kelly Allgood, Reuben V. Anderson, John L. Black, Jr.,
Harry H. Bush, Robert P. Cooke III, Frank R. Day, William
C. Deviney, Jr., D. G. Fountain, Jr., C. Gerald Garnett,
Matthew L. Holleman III, Fred A. Jones, T. H. Kendall
III, Larry L. Lambiotte, Robert V. Massengill, Donald E.
Meiners, William Neville III, Richard H. Puckett, Charles
W. Renfrow, Clyda S. Rent, William Thomas Shows, Harry M.
Walker, LeRoy G. Walker, Jr., Paul H. Watson, Jr., John
C. Wheeless, Jr. and Allen Wood, Jr.
2. Approval of Trustmark Corporation 1997 Long Term Incentive Plan
Management knows of no other matters that may properly be, or which are likely
to be, brought before the meeting. In their discretion, the Proxies are
authorized to vote upon such other business as may properly come before the
meeting in accordance with the decision of the Board of Directors.
SEE REVERSE SIDE
<PAGE>
(X) Please mark your
vote as in this example
When properly executed, this proxy will be voted in the manner directed by the
undersigned shareholder. If no direction is made, the shares will be voted in
accordance with the recommendation of the Board of Directors. Unless authority
is withheld as to a particular nominee, the proxy will be voted for each nominee
listed.
1. Election of Directors (see reverse)
( ) FOR all nominees
( ) WITHHOLD all nominees
( ) FOR, EXCEPT vote withheld from the following nominee(s):
--------------------------------------------------------------
2. Approval of Trustmark Corporation 1997 Long Term Incentive Plan
( ) FOR
( ) AGAINST
( ) ABSTAIN
Please sign exactly as name appears. When shares are held as joint tenants, both
are requested to sign. Trustees, attorneys, executors, administrators,
guardians, and others signing in a representative capacity should indicate the
capacity in which they sign. If a corporation, please sign in full corporate
name by President or other authorized officer. If a partnership, please sign in
partnership name by authorized person.
Signature Date
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Signature Date
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Please mark, sign, date and return proxy card promptly using the enclosed
envelope.
