<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:
/ / Preliminary proxy statement / / Confidential, for Use of the
Commission Only (as permitted by
Rule 14a-6(e)(2))
/X/ Definitive proxy statement
/ / Definitive additional materials
/ / Soliciting material pursuant to Rule 14a-11(c) or Rule 14a-12
FIRSTAR CORPORATION
- --------------------------------------------------------------------------------
(Name of Registrant as Specified in Its Charter)
FIRSTAR CORPORATION
- --------------------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
Payment of filing fee (Check the appropriate box):
/X/ $125 per Exchange Act Rule 0-11(c)(1)(ii), 14a-6(i)(1), or 14a-6(i)(2)
or Item 22(a)(2) of Schedule 14A.
/ / $500 per each party to the controversy pursuant to Exchange Act Rule
14a-6(i)(3).
/ / Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and
0-11.
(1) Title of each class of securities to which transaction applies:
- --------------------------------------------------------------------------------
(2) Aggregate number of securities to which transaction applies:
- --------------------------------------------------------------------------------
(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (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:
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(2) Form, schedule or registration statement no.:
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(3) Filing party:
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(4) Date filed:
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<PAGE> 2
[LOGO] FIRSTAR CORPORATION
777 EAST WISCONSIN AVENUE
P.O. BOX 532
MILWAUKEE, WISCONSIN 53202
NOTICE OF
ANNUAL MEETING OF SHAREHOLDERS
TO BE HELD APRIL 20, 1995
To the Holders of Common Stock of
Firstar Corporation:
The annual meeting of the shareholders of Firstar Corporation will be held
in the Firstar Center, Clybourn Level, 777 East Wisconsin Avenue, Milwaukee,
Wisconsin, on Thursday, the 20th day of April 1995, at two o'clock p.m. The
purposes of the meeting are:
1. To elect 7 directors to hold office until their successors are duly
elected and qualified.
2. To transact any other business which may properly come before such
meeting or any adjournments thereof.
WHETHER OR NOT YOU PLAN TO ATTEND THE MEETING, IT IS IMPORTANT THAT YOU EXECUTE,
DATE AND RETURN PROMPTLY YOUR PROXY IN THE ENCLOSED POSTPAID ENVELOPE. YOU MAY
WITHDRAW YOUR PROXY AT ANY TIME PRIOR TO ITS BEING VOTED.
[SIG]
William J. Schulz
Senior Vice President
and Secretary
March 20, 1995
<PAGE> 3
FIRSTAR CORPORATION
777 East Wisconsin Avenue
Milwaukee, Wisconsin 53202
PROXY STATEMENT
ANNUAL MEETING OF SHAREHOLDERS
APRIL 20, 1995
PERSONS MAKING THE SOLICITATION
This proxy statement and the accompanying proxy card are being mailed to
holders of common stock commencing on or about March 20, 1995 and are furnished
in connection with the solicitation of proxies by the Board of Directors of
Firstar Corporation (hereinafter referred to as "Firstar") at the expense of
Firstar through the mails for use at the annual meeting of shareholders to be
held April 20, 1995 at two o'clock p.m. in the Firstar Center, Clybourn Level,
at 777 East Wisconsin Avenue, Milwaukee, Wisconsin 53202, or at any adjournments
thereof. Employees of Firstar may solicit proxies by telephone and in person at
no extra cost to Firstar. Properly signed and dated proxies received by the
Secretary of Firstar prior to or at the annual meeting will be voted as
instructed thereon or, in the absence of such instruction, "FOR" Item 1 and in
accordance with the best judgment of the persons named in the proxy on any other
matters which may properly come before the meeting. Any shareholder giving a
proxy has the power to revoke it at any time before it is actually voted by
delivery of a written notice of revocation to the Secretary of Firstar at the
above-indicated address. Unless so revoked, the shares represented by each proxy
will be voted at the meeting and at any adjournments thereof.
VOTING PROCEDURES/VOTES REQUIRED
A quorum consists of a majority of the shares entitled to vote represented
at the annual meeting in person or by proxy (including proxies reflecting
abstentions or broker non-votes). Broker non-votes are shares which are
represented at the meeting by proxy for which the record holder has not been
granted the authority to vote on one or more proposals. Once a share is
represented at the meeting it is deemed present for quorum purposes throughout
the meeting or any adjourned meeting unless a new record date is or must be set
for the adjourned meeting. The seven nominees for director who receive the
largest number of votes cast "FOR" will be elected as directors if a quorum is
present. Shares represented at the meeting for which authority to vote for a
nominee for director is withheld and non-votes will not affect the determination
of the outcome of the election of directors.
VOTING SECURITIES AND OWNERSHIP THEREOF
BY CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
Holders of record of common stock of Firstar at the close of business on
March 2, 1995 (the "Record Date") will be entitled to one vote for each share of
common stock then held. There were 72,861,171 shares of Firstar's common stock
outstanding on the Record Date.
1
<PAGE> 4
The following table sets forth information as of December 31, 1994 as to
the "beneficial ownership" of the common stock of Firstar by all of the
directors named in the proxy statement (except for Mr. Johnson, whose
information is as of the date of his appointment to the Board on January 31,
1995), the five most highly compensated executive officers of Firstar, and
directors and all executive officers of Firstar as a group.
<TABLE>
<CAPTION>
AMOUNT AND NATURE OF
NAME BENEFICIAL OWNERSHIP(1) PERCENT OF CLASS(2)
------------------------------------- ----------------------- -------------------
<S> <C> <C>
Michael E. Batten.................... 800
Chris M. Bauer(3).................... 70,721
John A. Becker(3).................... 153,975
Ronald A. Bero(3).................... 93,267
Robert C. Buchanan................... 700
George M. Chester, Jr.(4)............ 17,100
Roger H. Derusha(5).................. 31,600
Roger L. Fitzsimonds(3).............. 209,164
James L. Forbes...................... 1,000
Holmes Foster........................ 4,333
Joseph F. Heil, Jr................... 47,460
John H. Hendee, Jr................... 94,160
Jerry M. Hiegel...................... 11,400
Joe Hladky........................... 5,632
C. Paul Johnson(3)................... 975,324 1.3%
James H. Keyes....................... 1,207
James R. Lang(3)..................... 83,292
Sheldon B. Lubar(6).................. 169,800
Daniel F. McKeithan, Jr.............. 14,400
George W. Mead II.................... 800
Guy A. Osborn........................ 4,000
Judith D. Pyle....................... 2,070
Clifford V. Smith, Jr................ 380
William W. Wirtz(7).................. 1,419,120 2.2%
Aggregate for all directors and
executive officers as a group(3)... 4,022,124 5.9%
</TABLE>
- ------------
(1) Unless otherwise indicated, the beneficial owners exercise sole voting and
investment powers.
(2) Unless otherwise indicated, percentages are less than one percent.
Percentage ownership as of December 31, 1994 except for Mr. Johnson as of
January 31, 1995.
(3) Includes shares which have been allocated to the individual as of December
31, 1994 under Firstar's Thrift and Sharing Plan and for which the
individuals have sole voting rights and investment power: Chris M. Bauer -
7,345; John A. Becker - 16,977; Ronald A. Bero - 21,462; Roger L.
Fitzsimonds - 7,938; James R. Lang - 28,924; and all directors and executive
officers as a group - 194,413. Also includes the right to acquire shares
upon exercise of options granted under Firstar's stock option plan: Chris M.
Bauer - 57,800; John A. Becker - 98,700; Ronald A. Bero - 38,800; Roger L.
Fitzsimonds - 143,400; C. Paul Johnson - 109,690; James R. Lang - 41,600;
and all directors and executive officers as a group - 844,290. Also includes
restricted shares subject to forfeiture and held in escrow pending the
completion of a performance period: Chris M. Bauer - 2,576; John A. Becker -
4,560; Ronald A. Bero - 2,012; Roger L. Fitzsimonds - 6,700; James R. Lang -
2,012; and all directors and executive officers as a group - 30,235.
(4) Includes 12,400 shares for which voting and investment powers are shared.
(5) Includes 1,600 shares for which voting and investment powers are shared.
(6) Includes 132,332 shares for which voting and investment powers are shared.
(7) Includes 1,388,500 shares held by companies in which Mr. Wirtz is a
controlling shareholder and 18,400 shares in a pension trust.
2
<PAGE> 5
As of December 31, 1994, the following group was the beneficial owner of
more than 5% of Firstar's outstanding common stock:
Firstar, through subsidiaries which conduct various fiduciary
activities, held 10,299,434 shares, or 15.5% of Firstar's common stock in
estates, trusts and other fiduciary accounts. Sole voting power is
possessed with respect to 966,358 shares, while sole investment power is
retained for 7,572,285 shares. Shares held in the Firstar Corporation
Thrift and Sharing Plan are included as having sole investment power by
virtue of the ability of Firstar to amend the plan. Included in these
totals are 6,952,545 shares, or 10.6% of Firstar's common stock, held by
the Firstar Corporation Thrift and Sharing Plan.
ELECTION OF DIRECTORS
The Articles of Incorporation of Firstar provide that the Board of
Directors of Firstar shall be divided into three classes as nearly equal in
number as possible, with the term of office of one class expiring each year.
Each class shall hold office for a term of three years. At the annual meeting,
seven directors will be elected to a three-year term expiring in 1998.
It is the intention of the persons named in the proxy, unless otherwise
directed, to vote the proxies given them for the election of these nominees. All
those named as nominees are presently serving as directors and were elected by
the shareholders. All of the nominees have consented to being named in this
proxy statement and to serve if elected, and the Board of Directors has no
reason to believe that any of the named nominees will be unable to act. However,
if any such nominee prior to election becomes unable to serve or for good cause
will not serve, the proxies will be voted for such substitute nominee as may be
selected by the Board of Directors of Firstar or only for the remaining
nominees. The names, ages and business experience during the past 5 years
(including principal occupations and employment during that period) of the
nominees, all principal positions and offices with Firstar and Board committee
memberships presently held by them, and certain directorships held in other
companies are set forth below. All directors not named as members of the
Executive Committee of the Board of Directors are alternate members of that
committee. None of the directors or executive officers are related. With the
exception of Messrs. Fitzsimonds, Becker and Hendee, all of the directors'
business experience listed has been with organizations unaffiliated with
Firstar.
NOMINEES FOR TERMS EXPIRING IN 1998
- --------------------------------------------------------------------------------
ROGER H. DERUSHA
Chairman of the Board and Director of Marinette Marine Corporation,
Marinette, Wisconsin. Ship designers and builders.
He is 64 years of age and has been a director of Firstar since 1980. He is
also a director of Firstar Bank Green Bay.
- --------------------------------------------------------------------------------
JERRY M. HIEGEL
Chairman of The Hiegel Group, a private investment banking company located
in Madison, Wisconsin. Retired in 1989 as Chairman of the Board of Oscar Mayer
Foods Corporation, Madison, Wisconsin. Manufacturer of brand-identified
processed meats.
He is 68 years of age and has been a director of Firstar since 1983 and is
a member of the Compensation and Audit-Examining Committees of the Board of
Directors.
He is also a director of Oshkosh B'Gosh, Inc. and of McCarthy Improvement
Co. of Davenport, Iowa.
3
<PAGE> 6
- --------------------------------------------------------------------------------
SHELDON B. LUBAR
Chairman of Lubar & Co., Milwaukee, Wisconsin. Investment and management
firm.
He is 65 years of age and has been a director of Firstar since 1986 and is
a member of the Executive, Committee on Directors, Audit-Examining, Compensation
and Interstate Banking and Acquisitions Committees of the Board of Directors. He
is also a director of Firstar Bank Milwaukee.
He is also a director of Christiana Companies, Inc., Massachusetts Mutual
Life Insurance Company, MGIC Investment Corporation, Ameritech Corporation and
various private industrial companies.
- --------------------------------------------------------------------------------
DANIEL F. McKEITHAN, JR.
President and Chief Executive Officer of Tamarack Petroleum Company, Inc.,
Milwaukee, Wisconsin. Operator of producing oil and gas wells. Also, President
and Chief Executive Officer of Active Investor Management, Inc., Milwaukee,
Wisconsin. Manager of oil and gas wells; and President of AIM and Associates, an
accounting firm.
He is 59 years of age and has been a director of Firstar since 1977 and is
a member of the Audit-Examining, Compensation and Employee Benefits Committees
of the Board of Directors.
He is also a director of Marcus Corporation and WICOR, Inc. and a Trustee
of Northwestern Mutual Life Insurance Company.
- --------------------------------------------------------------------------------
GEORGE W. MEAD II
Chairman of Consolidated Papers, Inc., Wisconsin Rapids, Wisconsin.
Manufacturer and marketer of paper products.
He is 67 years of age and has been a director of Firstar since 1990. He is
also a director of Firstar Bank Wisconsin Rapids.
He is also a director of Snap-on Corporation.
- --------------------------------------------------------------------------------
GUY A. OSBORN
Chairman, Chief Executive Officer and a director of Universal Foods
Corporation, Milwaukee, Wisconsin since May 1990. Manufacturer and marketer of
food ingredients and selected consumer items. President and Chief Executive
Officer from 1988.
He is 59 years of age and has been a director of Firstar since 1992 and is
a member of the Committee on Directors, Compensation, Employee Benefits,
Executive and Interstate Banking and Acquisitions Committees of the Board of
Directors. He is also a director of Firstar Bank Milwaukee.
He is also a director of WICOR, Inc., Wisconsin Gas Co. and the Fleming
Companies and a trustee of Northwestern Mutual Life Insurance Company.
- --------------------------------------------------------------------------------
WILLIAM W. WIRTZ
President and a director of Wirtz Corporation, Chicago, Illinois.
Diversified operations and investments.
He is 65 years of age and has been a director of Firstar since 1980 and is
a member of the Audit-Examining Committee of the Board of Directors.
He is also a director of Consolidated Enterprises, Inc., Forman Realty
Corporation, American Mart Corporation, 333 Building Corporation, Chicago
Stadium Corporation, Chicago Blackhawk Hockey Team, Inc. and Alberto-Culver
Company.
4
<PAGE> 7
CONTINUING DIRECTORS WHOSE TERMS EXPIRE IN 1998
- --------------------------------------------------------------------------------
JOHN A. BECKER
President and Chief Operating Officer of Firstar since February 1991. He
had been President of Firstar, Chairman of the Board and Chief Executive Officer
of Firstar Bank Milwaukee since January 1990.
He is 52 years of age, has been a director of Firstar since 1989 and is a
member of the Executive Committee of the Board of Directors. He is also a
director of Firstar Bank Milwaukee, Firstar Trust Company, Firstar Corporation
of Iowa and Firstar Bank of Minnesota.
He is also a director of Giddings & Lewis Corporation, Inc.
- --------------------------------------------------------------------------------
GEORGE M. CHESTER, JR.
Partner of Covington & Burling, Washington, DC law firm.
He is 47 years of age and has been a director of Firstar since 1988.
- --------------------------------------------------------------------------------
ROGER L. FITZSIMONDS
Chairman of the Board and Chief Executive Officer of Firstar since February
1991. He had been Vice Chairman of Firstar since January 1990.
He is 56 years of age, has been a director of Firstar since 1988 and is a
member of the Executive Committee and Committee on Directors of the Board of
Directors. He is also a director of Firstar Bank Milwaukee and Firstar Trust
Company.
- --------------------------------------------------------------------------------
HOLMES FOSTER
Retired. Chairman of the Board, President and Chief Executive Officer of
Banks of Iowa, Inc. from July 1988 to April 1991; President and Chief Executive
Officer prior to that.
He is 68 years of age and has been a director of Firstar since 1991. He is
also a director of Firstar Corporation of Iowa.
He is also a director of Iowa Business Development Finance Corporation and
Chairman, President and a director of Iowa Business Investment Corporation.
- --------------------------------------------------------------------------------
JOE HLADKY
President and Chief Executive Officer of the Gazette Company, Cedar Rapids,
Iowa. An independent media company.
He is 54 years of age and has been a director of Firstar since 1991 and is
a member of the Audit-Examining Committee of the Board of Directors. He is also
a director of Firstar Corporation of Iowa and Firstar Bank Cedar Rapids.
- --------------------------------------------------------------------------------
JUDITH D. PYLE
Vice Chairman, Senior Vice President-Marketing and a director of Rayovac
Corporation, Madison, Wisconsin. Manufacturer and marketer of batteries and
lighting products.
She is 51 years of age and has been a director of Firstar since 1989 and is
a member of the Audit-Examining Committee of the Board of Directors.
She is also a director of Oshkosh B'Gosh, Inc. and WPL Holdings.
5
<PAGE> 8
- --------------------------------------------------------------------------------
DR. CLIFFORD V. SMITH, JR.
President of the General Electric Fund since 1990 and Chancellor Emeritus
of the University of Wisconsin-Milwaukee. He was Chancellor of the University of
Wisconsin-Milwaukee from 1986 to 1990.
He is 63 years of age and has been a director of Firstar since 1990.
CONTINUING DIRECTORS WHOSE TERMS EXPIRE IN 1996
- --------------------------------------------------------------------------------
MICHAEL E. BATTEN
Chairman, Chief Executive Officer and a director of Twin Disc,
Incorporated, Racine, Wisconsin since November 1991. Manufacturer of power
transmission equipment. He had been Chairman, President, Chief Executive Officer
and a director of that company from July 1989.
He is 54 years of age and has been a director of Firstar since 1984 and is
a member of the Executive, Audit-Examining, Committee on Directors and
Interstate Banking and Acquisitions Committees of the Board of Directors. He is
also a director of Firstar Trust Company.
He is also a director of Universal Foods Corporation and Briggs & Stratton
Corporation.
- --------------------------------------------------------------------------------
ROBERT C. BUCHANAN
President, Chief Executive Officer and a director of Fox Valley
Corporation, Appleton, Wisconsin. Manufacturer and marketer of paper products.
He is 54 years of age and has been a director of Firstar since 1994.
He is also a director of Ariens Company, W.H. Brady Company, Charter
Manufacturing Company, Kaukauna Cheese and American Forest & Paper Association
and a trustee of Northwestern Mutual Life Insurance Company and Lawrence
University.
- --------------------------------------------------------------------------------
JAMES L. FORBES
President, Chief Executive Officer and a director of Badger Meter, Inc.
Manufacturer of flow measurement technology.
He is 62 years of age and has been a director of Firstar since 1993 and is
a member of the Compensation and Employee Benefits Committees of the Board of
Directors. He is also a director of Firstar Trust Company.
He is also a director of Universal Foods Corporation and United Wisconsin
Services.
- --------------------------------------------------------------------------------
JOSEPH F. HEIL, JR.
Chairman of the Board and a director of The Heil Co., Chattanooga,
Tennessee, a subsidiary of Dover Industries. Manufacturers of solid waste
systems and transportation equipment.
He is 69 years of age and has been a director of Firstar since 1970.
- --------------------------------------------------------------------------------
JOHN H. HENDEE, JR.
Retired. Chairman of the Board and Chief Executive Officer of Firstar from
April 1988 to January 1991; Vice Chairman from January 1987 to April 1988;
Chairman of the Board of Firstar Bank Milwaukee from May 1986 to January 1990.
He is 69 years of age, has been a director of Firstar since 1976 and is a
member of the Executive, Committee on Directors and Interstate Banking and
Acquisitions Committees of the Board of Directors. He is also a director of
Firstar Bank Milwaukee and Firstar Trust Company of Florida.
6
<PAGE> 9
- --------------------------------------------------------------------------------
C. PAUL JOHNSON
Former Chairman of the Board and Chief Executive Officer of First Colonial
Bankshares Corporation.
He is 63 years of age and has been a director of Firstar since January
1995.
- --------------------------------------------------------------------------------
JAMES H. KEYES
Chairman of the Board, President and Chief Executive Officer of Johnson
Controls, Inc., Milwaukee, Wisconsin, since January 1993. Designer,
manufacturer, installer and servicer of building automation systems for energy
management, fire safety and security; manufacturer and marketer of batteries for
energy storage and manufacturer of automotive seating and plastics. He had been
President and Chief Executive Officer prior to that.
He is 54 years of age and has been a director of Firstar since 1993 and is
a member of the Audit-Examining, Committee on Directors, Executive and
Interstate Banking and Acquisitions Committees of the Board of Directors. He is
also a director of Firstar Bank Milwaukee and Firstar Trust Company.
He is also a director of Universal Foods Corporation and LSI Logic.
- --------------------------------------------------------------------------------
COMMITTEES OF THE BOARD OF DIRECTORS
Firstar has various committees including standing audit (Audit-Examining
Committee), nominating (Committee on Directors) and Compensation committees. The
names of members on March 2, 1995 and the functions performed by such named
committees are set forth below.
AUDIT-EXAMINING COMMITTEE
Sheldon B. Lubar, Chairman
Michael E. Batten Daniel F. McKeithan, Jr.
Jerry M. Hiegel Judith D. Pyle
Joe Hladky William W. Wirtz
James H. Keyes
Functions performed--The Audit-Examining Committee's general responsibilities
include, but are not limited to, supervision and review of all matters
concerning audits of Firstar by its independent auditors and internal corporate
audit staff, review of all matters concerning examinations of Firstar and its
subsidiary banks and companies conducted by governmental supervisory agencies
and review of Firstar's Annual Report on Form 10-K and Annual Report to
Shareholders. There were five meetings held during 1994.
COMMITTEE ON DIRECTORS
Sheldon B. Lubar, Chairman
Michael E. Batten James H. Keyes
Roger L. Fitzsimonds Guy A. Osborn
John H. Hendee, Jr.
Functions performed--The Committee on Directors has the general responsibility
of recommending policy as to the responsibilities, size and committee structure
of the Board of Directors. It also develops recommendations as to the
compensation, qualifications, tenure and selection of Board members, scheduling
and content of Board meetings, and directors' and officers' liability
protection. The committee considers director nominees recommended by
shareholders. Any shareholder who wishes to recommend an individual for
nomination as a director of Firstar should write to the Secretary of Firstar, no
later than October 31 of the year preceding the annual meeting of shareholders
at which directors are to be elected, identifying the individual recommended and
setting forth any information which the shareholder believes will be helpful to
the Committee on Directors
7
<PAGE> 10
in evaluating the qualifications of the recommended nominee. The Committee on
Directors and, ultimately, the Board of Directors, reserves the sole discretion
to determine the nominees named in management's proxy statement for election to
the Board of Directors. There were two meetings held during 1994.
COMPENSATION COMMITTEE
Guy A. Osborn, Chairman
James L. Forbes Sheldon B. Lubar
Jerry M. Hiegel Daniel F. McKeithan, Jr.
Functions performed--The Compensation Committee has the general responsibility
of recommending for the approval of the Board of Directors the remuneration
arrangements for the executive officers of Firstar and its subsidiaries and any
additions or modifications to the employee benefit plans administered by Firstar
for the benefit of the officers and employees of Firstar and its subsidiaries.
There were five meetings held during 1994.
The Board of Directors held five meetings during 1994. All directors
attended 75% or more of the aggregate of (1) the total number of meetings of the
Board of Directors (held during the period for which they have been a director)
and (2) the total number of meetings held by all committees of the Board on
which they served (during the periods that they served).
Following the election at the annual meeting, there will be twenty-one
directors of Firstar Corporation. No person shall be eligible to be elected or
re-elected as a member of the Board of Directors if he or she reached the age of
seventy (70) years, and any director who reaches the age of seventy (70) years
shall resign from the Board of Directors as of the last day of the calendar
quarter in which such director's seventieth birthday falls. The Board of
Directors may authorize a change to the foregoing retirement provision.
DIRECTOR COMPENSATION
The directors of Firstar are compensated for all services as a director in
the following manner: An annual retainer fee of $16,000 is paid each director at
the rate of $4,000 per quarter. An annual retainer fee of $4,000 is paid to the
chairman of the Audit-Examining Committee at the rate of $1,000 per quarter. A
$1,400 fee is paid for attendance at each regularly scheduled or special meeting
of the Board, a $1,400 fee is paid for attendance at meetings of the Executive
or Interstate Banking and Acquisitions Committees, and a $800 fee is paid
committee members for attendance at regularly scheduled or special meetings of
all other committees of the Board. Directors of Firstar who are also directors
of subsidiaries of Firstar also receive fees from such subsidiaries for services
as directors on their boards. Firstar has a deferred compensation plan under
which directors may elect to defer payment of such fees. Those directors who are
officers of Firstar or its subsidiary banks receive no fees from Firstar or the
subsidiary banks for services as directors.
8
<PAGE> 11
COMPENSATION OF EXECUTIVE OFFICERS
The following Summary Compensation Table presents data with respect to the
five most highly compensated executive officers for each of the years in the
three-year period ended December 31, 1994.
SUMMARY COMPENSATION TABLE
<TABLE>
<CAPTION>
LONG-TERM COMPENSATION
--------------------------------------------------
AWARDS
ANNUAL COMPENSATION ------------------- LONG-TERM
------------------------------ RESTRICTED STOCK INCENTIVE ALL OTHER
NAME AND PRINCIPAL POSITION YEAR SALARY BONUS OTHER(1) STOCK(2) OPTION PAYOUT COMPENSATION(3)
- ----------------------------- ---- -------- -------- -------- ---------- ------ ---------- ---------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Roger L. Fitzsimonds
Chairman of the Board...... 1994 $595,000 $303,900 38,100 $138,100 $53,500
Chairman of the Board...... 1993 548,000 378,900 22,500 144,200 49,300
Chairman of the Board...... 1992 477,000 308,700 23,600 107,500 42,900
John A. Becker
President.................. 1994 435,000 206,800 23,100 88,700 39,100
President.................. 1993 405,000 257,800 15,200 90,000 36,400
President.................. 1992 372,000 195,100 18,200 81,100 33,500
Chris M. Bauer
Chairman of Firstar Bank
Milwaukee................ 1994 280,000 115,600 9,200 50,000 21,000
Chairman of Firstar Bank
Milwaukee................ 1993 259,000 149,000 9,000 52,400 19,400
Chairman of Firstar Bank
Milwaukee................ 1992 237,000 123,400 9,800 48,700 17,700
James R. Lang
Chairman of the Board
Firstar Corp. of Iowa.... 1994 250,000 89,500 8,200 44,700 22,500
Chairman of the Board
Firstar Corp. of Iowa.... 1993 233,000 105,100 8,000 46,900 20,600
Chairman of the Board
Firstar Corp. of Iowa.... 1992 205,000 98,700 7,800 42,000 17,500
Ronald A. Bero
Senior Executive VP........ 1994 218,000 103,100 8,200 45,400 19,600
Senior Executive VP........ 1993 210,000 115,900 8,000 49,500 18,900
Senior Executive VP........ 1992 208,000 106,200 9,800 49,200 18,800
</TABLE>
- ------------
(1) Aggregate amount of other annual compensation does not exceed the lesser of
$50,000 or 10% of executive officer's salary and bonus.
(2) The total number of restricted shares held and the aggregate market value at
December 31, 1994 was: Mr. Fitzsimonds--6,700 shares, $180,063; Mr.
Becker--4,560 shares, $122,550; Mr. Bauer--2,576 shares, $69,230; Mr.
Lang--2,012 shares, $54,073; Mr. Bero--2,012 shares, $54,073. Dividends are
paid on the restricted shares at same rate as dividends paid to unrestricted
shares and are held in escrow pending the completion of the performance
period and determination of the shares to be earned.
(3) Amounts shown represent payments made under Firstar's Thrift and Sharing
Plan which consist of both contributions to the plan and cash payments made
to the executive officer to offset Internal Revenue Code limitations.
9
<PAGE> 12
The following table presents information about stock options granted during
1994 to the five named executive officers.
STOCK OPTION GRANTS IN 1994
<TABLE>
<CAPTION>
INDIVIDUAL GRANTS
-----------------------------------------------------
NUMBER OF PERCENT OF
SECURITIES TOTAL OPTIONS
UNDERLYING GRANTED TO EXERCISE EXPIRATION GRANT DATE
NAME OPTIONS EMPLOYEES PRICE DATE PRESENT VALUE(1)
- ------------------------------------ ---------- ------------- -------- ---------- -----------------
<S> <C> <C> <C> <C> <C>
Roger L. Fitzsimonds................ 38,100 10.3% $ 30.875 2/20/04 $ 311,277
John A. Becker...................... 23,100 6.3 30.875 2/20/04 188,727
Chris M. Bauer...................... 9,200 2.5 30.875 2/20/04 75,164
James R. Lang....................... 8,200 2.2 30.875 2/20/04 66,994
Ronald A. Bero...................... 8,200 2.2 30.875 2/20/04 66,994
</TABLE>
- ------------
(1) Present value is determined as of the grant date, January 20, 1994, using
the Black-Scholes Model. This is a theoretical value for the stock options
which was constructed with the following underlying assumptions: a 10 year
expected period to time of exercise; a risk free rate of return of 6.0%; an
expected dividend yield of 3.4%; and a volitality factor of 22.3%. The
amount realized from a stock option ultimately depends on the market value
of the stock at a future date.
The following table presents information concerning stock options exercised
during 1994. Also shown is information on unexercised stock options as of
December 31, 1994.
STOCK OPTIONS EXERCISED IN 1994 AND YEAR-END VALUES
<TABLE>
<CAPTION>
1994 TOTAL VALUE OF
----------------------- TOTAL NUMBER OF UNEXERCISED UNEXERCISED IN-THE-MONEY
SHARES OPTIONS HELD AT 12/31/94 OPTIONS HELD AT 12/31/94
ACQUIRED ON VALUE ---------------------------- ----------------------------
NAME EXERCISE REALIZED EXERCISABLE UNEXERCISABLE EXERCISABLE UNEXERCISABLE
- ---------------------------- ----------- -------- ----------- ------------- ----------- -------------
<S> <C> <C> <C> <C> <C> <C>
Roger L. Fitzsimonds........ 0 0 105,300 38,100 $ 805,700 0
John A. Becker.............. 0 0 75,600 23,100 570,275 0
Chris M. Bauer.............. 0 0 48,600 9,200 405,125 0
James R. Lang............... 0 0 33,400 8,200 234,188 0
Ronald A. Bero.............. 0 0 30,600 8,200 166,063 0
</TABLE>
The following table presents information on Long-Term Incentive Awards
granted to the named executives during 1994. Estimated future payouts are
predicated upon the achievement of Firstar return on equity goals in relation to
peer group banking companies. The achievement of peer group median return on
equity will represent threshold; peer group 70th percentile will represent
target and peer group 90th percentile will represent maximum payout. The award
is designated in shares of stock. These performance shares are valued at the end
of the three year period based upon the market value of Firstar's common stock.
The participant is paid the value of the earned award one-half in shares of
Firstar's common stock and one-half in cash plus a dividend equivalent for the
performance period.
LONG-TERM INCENTIVE PLAN AWARDS IN 1994
<TABLE>
<CAPTION>
ESTIMATED FUTURE PAYOUTS
UNDER NON-STOCK PRICE BASED
TARGET PERFORMANCE PLANS
NUMBER OF PERIOD --------------------------------
NAME UNITS UNTIL PAYOUT THRESHOLD TARGET MAXIMUM
- ----------------------------------------- --------- ------------ --------- ------ -------
(NUMBER OF UNITS)
<S> <C> <C> <C> <C> <C>
Roger L. Fitzsimonds..................... 9,649 3 Years 4,825 9,649 14,434
John A. Becker........................... 6,566 3 Years 3,283 6,566 9,849
Chris M. Bauer........................... 3,709 3 Years 1,855 3,709 5,564
James R. Lang............................ 2,897 3 Years 1,449 2,897 4,346
Ronald A. Bero........................... 2,897 3 Years 1,449 2,897 4,346
</TABLE>
10
<PAGE> 13
The following table presents estimated annual benefits payable under
Firstar's pension plans based upon years of service.
<TABLE>
<CAPTION>
REMUNERATION 15 YEARS 20 YEARS 25 YEARS 30 YEARS 35+ YEARS
- ------------ -------- -------- -------- -------- ---------
<S> <C> <C> <C> <C> <C>
$100,000 $ 25,715 $ 34,286 $ 42,857 $ 51,429 $ 60,000
200,000 51,430 68,571 85,714 102,857 120,000
300,000 77,145 102,856 128,571 154,286 180,000
400,000 102,860 137,142 171,428 205,714 240,000
500,000 128,575 171,429 214,287 257,140 300,000
600,000 154,290 205,713 257,142 308,571 360,000
700,000 180,000 240,000 300,000 360,000 420,000
800,000 205,720 274,288 342,856 411,432 480,000
900,000 231,435 308,568 385,713 462,861 540,000
</TABLE>
The remuneration covered by the plan includes salary and one-half of bonus
and long-term incentive payments. The final average compensation is based on
average compensation during the highest five consecutive years in the last ten
years prior to retirement. The annual benefit amounts listed in the table are
subject to a reduction equal to one-half of the Social Security benefit at the
time of retirement. The years of service of the named executives are as follows:
Mr. Fitzsimonds--30 years, Mr. Becker--27 years, Mr. Bauer--25 years, Mr.
Lang--27 years and Mr. Bero--33 years. An agreement has been entered into with
an executive officer other than the named executives, whereby his pension will
be credited for up to ten additional years of service upon retirement.
Estimated annual benefits listed in the table are based on the terms of the
Pension Plan in effect as of December 31, 1994 and assume payment in the form of
a straight-life annuity beginning at age 65 without reduction for the election
of a joint and survivor annuity or for any limitation on maximum annual benefits
or compensation under the Internal Revenue Code. In the event that any such
reduction occurs, the named persons will receive benefits in the amount of such
reduction under certain supplemental retirement plans maintained by Firstar. Any
supplemental benefits are payable out of the general assets of Firstar.
EMPLOYMENT AGREEMENTS
Firstar has identical Key Executive Employment and Severance Agreements
with Messrs. Fitzsimonds, Becker, Bauer, Lang, Bero and others. The agreements
would come into effect upon a change in control of Firstar as defined in the
agreements. The employment period under each agreement is the earlier of the
third anniversary of the change in control or the executive's sixty-fifth
birthday. If, during the employment period, the executive officer's employment
is ended through (1) termination by Firstar without cause or (2) termination by
the executive officer for good reason based upon a breach of the agreement by
Firstar or a significant adverse change in the executive officer's
responsibilities, then a termination payment will be made to the executive. The
agreements provide that such payment will be equal to three times the sum of the
executive's annual salary plus an amount attributable to incentive compensation
equal to a target payment under such plans. If any portion of the termination
payment constitutes an excess parachute payment, as defined in the Internal
Revenue Code, and is subject to an excise tax, Firstar shall pay to the
executive the amount necessary to offset the excise tax and any applicable taxes
on this additional payment. Additional provisions assure the payment of other
accrued benefits regardless of the reason for termination. Upon a change in
control of Firstar, as defined in the plan, the executive is entitled to a lump
sum cash payment equivalent to the present value of the projected benefits under
certain supplemental retirement plans.
11
<PAGE> 14
BOARD COMPENSATION COMMITTEE REPORT ON EXECUTIVE COMPENSATION
Overall Policy
Firstar's executive compensation objective is to closely link compensation
with corporate and individual performance in a manner which, through recognizing
the marketplace practices of other banking companies, will retain and attract
executives who can lead Firstar to achieve the long-term goals of its
shareholders. Toward the end of achieving this objective, Firstar has an
executive compensation program which directly ties a significant portion of
total executive compensation to Firstar's financial performance in relation to
its peer group of U.S. commercial banking companies and to the appreciation in
its stock price.
The Compensation Committee has adopted the following statements of
philosophy which provide the foundation for Firstar's executive compensation
program:
1. Pay-for-Performance--the total compensation program should have a strong
pay-for-performance relationship.
2. Total Compensation--over time, total compensation relative to peers
should be consistent with performance relative to peers; in any one
year, the pay-performance match may lead or lag the peer group.
3. Total Cash Compensation--total cash compensation (base salary plus
annual incentive compensation) will be established conservatively with
no incentives paid for less than median performance.
4. Base Salaries--base salary midpoints will be established consistent with
the median of the peer group; actual base salaries will reflect
performance and experience within a competitive range.
5. Emphasis on Short-Term and Long-Term--emphasis should be placed on both
short-term (annual) and long-term performance; strong performance must
be achieved by Firstar each year as well as over the long-term.
6. Emphasis on Financial Performance versus Shareholder Value--for
short-term performance, emphasis should be placed on rewarding financial
performance; however, shareholder value is the most appropriate measure
of performance over the long-term.
Each year the Compensation Committee carefully reviews each component of
the executive compensation program. This review includes an assessment of the
total compensation opportunities provided by Firstar's program in relation to
both the compensation being paid by peer banking companies and the financial
performance of those peers. The peer group used by Firstar for all of its
financial performance comparisons, including its reports to the investment
community, represents U.S. commercial banking companies ranging in total asset
size from $10-$25 billion. It is data from this same peer group which the
Compensation Committee uses to gauge the comparative compensation levels of
Firstar's executive group. This peer banking group is also the same peer banking
group referred to in the performance graph at the bottom of page 17 which
portrays Firstar's performance as measured by return on equity. The performance
graph at the top of page 17 measures Firstar's total shareholder return against
the S&P 500 Stock Index and the KBW 50 Index which is a banking industry index
comprised of 50 companies representing all money center banks and most major
regional banks as maintained by Keefe, Bruyette and Woods, Inc.
For a number of years, the Committee has engaged an independent consultant
(an international accounting firm with significant experience in executive
compensation matters) to review the executive compensation program and the
resultant compensation earned by the senior executives.
The 1994 consultant's report, as reviewed by the Compensation Committee in
April 1994, concluded:
1. Actual 1993 cash compensation (base salary plus annual incentive
compensation) slightly exceeded the peer median while Firstar's
financial performance significantly exceeded the peer median.
2. Actual 1993 total compensation levels (cash compensation plus long-term
compensation) generally approximated the peer median.
12
<PAGE> 15
The principal components of Firstar's executive compensation program are
base salary, an annual incentive compensation plan, a three-year performance
share plan, a three-year cash plan which terminated at year-end 1994, and a
stock option program. The Compensation Committee determines these components
individually for each of the 15 executives who comprised Firstar's senior
executive group in the first quarter of 1994, which is when these components are
annually established. This group includes each of the five individuals whose
compensation is analyzed in this proxy statement. In determining the
compensation of these executives, other than the chief executive officer, the
Committee is generally guided by the recommendations of the chief executive
officer. However, it does independently approve the remuneration of all 15
executives on an individual basis.
Base Salaries
A base salary grade and range has been established for the job of each
executive officer. Base salary grade midpoints are established consistent with
the median of the peer group and the internal evaluation of the responsibilities
of each position.
In accordance with its annual procedure, at its January 1994 meeting, the
Compensation Committee approved an overall percentage increase of base salaries
for the executive officer group based on the following:
1. The results of published compensation surveys for the executive base
salary increase projections for the financial services industry in
general (these surveys are broad based and not peer group specific).
2. The financial performance of Firstar for the preceding year both
absolutely, as represented by a record high level of earnings per share
in 1993, and relatively vs. its peer group of $10-$25 billion U.S.
commercial banking companies for the most current period available
(which was the nine-month year-to-date period of 1993) as represented by
such measures of profitability and asset quality as return on equity
(top quartile), net loan charge-off ratio (top quartile), and
non-performing asset ratio (top quartile).
The overall base salary increase percentage approximated the median of the
salary surveys. Within this overall limit, the CEO recommended to the Committee
base salary adjustments for each executive (exclusive of the chief executive
officer) based upon his assessment of the executive's performance relative to
the executive's goals and objectives. In addition, promotion increases were made
for two executives.
In administering the base salary of the chief executive officer in 1994,
the Committee noted the sustained top quartile performance of Firstar under his
leadership as well as Firstar's most recent annual absolute and relative
performance, the relationship of his base salary to the midpoint of his job
grade, and the industry salary surveys referred to above. The chief executive
officer's base salary was increased by 3.8% in 1994.
Annual Incentive Compensation Plan
Firstar's executive officers are eligible for an annual incentive award.
Performance objectives are established each year. These objectives are based on
Firstar's return on equity and the performance of the executive's own business
unit. For the 15 executives comprising the senior executive group in 1994, at
least 50% of the award (with the exception of one officer where it was 25%),
ranging up to 100% for the corporation's chief executive officer and the
corporation's chief operating officer, is tied directly to Firstar's return on
common equity in comparison to the $10-$25 billion peer group. The goal for this
component of the Annual Incentive Compensation Plan is set in a manner which
does not compensate for below median performance; the Committee believes that
(1) performance is relative, and (2) no incentives should be paid unless
relative performance is at least equal to the median. Further, even if
performance is better than median, the Committee can elect to eliminate all
executive awards if Firstar's return on common equity does not exceed 12%.
Firstar's annual incentive compensation is a target bonus plan where target
represents a percentage of the salary grade midpoint of the executive's job
grade. For the 15 executives comprising the senior executive group in 1994, this
target percentage ranges from 30% of the participant's salary grade midpoint up
to 50% of the salary grade midpoint for the chief executive officer's position.
The bonus earned is based on performance and
13
<PAGE> 16
ranges from a threshold of 50% of target to a maximum of 150% of target. The
Committee has determined that to earn a threshold level of bonus on the
corporate performance factor, which for the chief executive officer and the
chief operating officer is the only factor, requires a return on common equity
equal to the median of the peer group. Performance below the median of the peer
group would result in no bonus being earned on the corporate performance factor.
To earn a target bonus, performance at the 70th percentile is required. To earn
a maximum bonus, performance at the 90th percentile is required.
The performance measures other than Firstar's return on equity which
comprise a portion of the Annual Incentive Compensation Plan for those officers
below the level of the chief executive officer and the chief operating officer
are established specific to each executive's business function including, for
example, net income and return on assets of the specific unit managed by the
executive, net charge-offs and non-performing asset levels of the unit, expense
management, specific project attainments, and other factors. Performance is
measured against target goals to determine payments.
In 1994, Firstar achieved a return on equity of 16.97%. Based on the
formula used in the plan, the chief executive officer earned a 1994 bonus of
$303,900, which equaled 102% of target. Payments to the other executives for
this factor also equaled 102% of target. Performance in 1994 by executives with
respect to their other factors, which varied from officer to officer, ranged
from 97% to 150% of target.
Three-Year Cash Performance Bonus Plan
Prior to 1993, Firstar's senior executive group were eligible for
participation in a cash performance bonus plan. This plan provided for the
earning of a cash bonus at the end of the three-year period following date of
the grant. The sole performance measure used to determine payout was Firstar's
average return on common equity in relation to the peer group. The plan was
modified in 1993 as discussed below under the three-year performance share plan.
The grant made in January 1992 matured at year-end 1994.
As with the annual incentive compensation plan, this was a target bonus
plan, with participant targets ranging from 12.5% of the participant's salary
grade midpoint up to 20% of the midpoint for the chief executive officer's job.
Again, as with the annual plan, unless Firstar's three-year median return on
common equity was at least equal to peer group median, no bonus would be paid.
Also, unless return on common equity was at least equal to 12%, regardless of
relative position, the Committee could elect to cancel the bonus. Payouts which
could be earned ranged from a minimum of 50% of target to a maximum of 150% of
target. To earn a minimum bonus required a three-year return on common equity
equal to the peer group median. A target bonus required 70th percentile
performance and a maximum bonus required a 90th percentile performance over the
three-year term.
The performance period for the 1992 performance bonus plan ended on
December 31, 1994. Based on the formula used in the plan, the chief executive
officer earned a three-year bonus at the end of 1994 of $138,100, which equaled
122% of target. Each of the other participants also received a payment equal to
122% of target.
Three-Year Performance Share Plan
In 1993, Firstar implemented a new three-year performance share plan for
its senior executives. This plan, which modified the three-year performance
bonus plan described above, was developed by the independent consultant retained
by the Committee. The modifications were intended to address in part the concern
that Firstar's compensation for senior executives was lagging competitive levels
based upon its high level of performance and to better tie long-term incentive
compensation to both internal financial performance and shareholder value.
The performance share plan retained the target feature of the performance
bonus plan. Under the revised plan, for the 15 executives comprising the senior
executive group, the target percentage ranges from 30% of the participant's
salary grade midpoint up to 50% of the salary grade midpoint for the chief
executive officer's job. In order for an executive to receive target payout,
Firstar must achieve a three-year return on common equity equal to the 70th
percentile performance by its peer group. Threshold payout, which is equal to
50% of target payout, requires a three-year return equal to the peer median
performance and maximum payout, which
14
<PAGE> 17
is equal to 150% of target payout, requires a 90th percentile performance
compared with peers. If Firstar achieves less than median performance, all
performance share awards are forfeited. Further, if return on common equity of
Firstar falls below 12% for the three-year period, regardless of comparative
peer performance, the Committee may cancel all performance share awards.
For the awards made in 1993, performance share awards were divided into two
parts consisting of performance-restricted shares of Firstar common stock and an
equal number of phantom performance-restricted shares payable in cash. The total
number of performance and phantom restricted shares awarded to an executive was
equal to the maximum award computed based upon the applicable percentage of
salary range midpoint for the executive, as described above, divided by the
price of one share of Firstar common stock on the date of grant. Following the
end of the three-year performance period, the number of performance shares and
phantom shares, if any, earned by executives will be determined based upon
Firstar's performance compared with its peer group. Firstar will then remove the
restrictions on the performance shares earned and will pay executives in cash
for an equal number of earned phantom shares. The balance of the performance
share earned will be an amount equal to the market price of one share of Firstar
common stock on the last business day of the three-year period. Executives will
also receive payment in an amount equal to the dividends payable by Firstar
during the three-year performance period on an equal number of shares of common
stock as the total of earned performance and phantom shares.
For awards made in 1994, the form of the award was modified following
shareholder approval in 1994 of the amended Incentive Stock Plan for Key
Employees. The incentive compensation opportunity provided by the plan is
unchanged from that described above. For awards made in 1994, a Performance
Account was established for each participant. The Performance Account is
designated in shares of stock whereby the number of shares in each participant's
account represents a target percentage applicable to each participant's job
grade, up to 50% for the chief executive officer, multiplied by the job grade
midpoint and divided by the fair market value of a share of stock on the date of
the award. At the end of the three-year period, the number of shares of stock
actually earned and credited to the participant's account will be determined
based upon Firstar's performance compared with its peer group as described in
the second paragraph of this section. The target number of performance shares
that could be earned in the three-year period by the chief executive officer and
the other 14 executives receiving awards in 1994 are 9,649 and 37,566,
respectively. The performance shares are valued at the end of the performance
period based upon the market price of Firstar's common stock. The participant is
paid the value of the earned award one-half in shares of Firstar's common stock
and one-half in cash plus a cash amount equal to the dividends paid during the
performance period on a number of shares equal to the number of performance
shares earned.
If the executive leaves Firstar for reasons other than retirement,
disability or death prior to the end of the three-year term of the awards, the
award is forfeited. A prorated payment is made in the event of retirement, death
or disability. The value of these awards is affected by both the relative
performance of Firstar vs. its peers over the three-year period as well as the
value of Firstar stock at the end of that period.
Stock Options
Stock options are designed to provide a direct long-term link between
executive compensation and shareholder interests. Options are granted with an
exercise price equal to the market value of the common stock on the date of the
grant. If the stock price does not increase, the option is worthless. The option
period is 10 years and one month from the date of grant.
Under Firstar's 1988 Incentive Stock Plan approved by shareholders, stock
options are granted to executive officers. The Compensation Committee utilizes a
grant value formula to award shares under this program. The grant value, which
represents the number of shares multiplied by the exercise price, is a
percentage of the midpoint of the executive's job grade. For the 15 executives
comprising the senior executive group, the 1994 grant values ranged from 90% of
the participant's salary grade point up to 200% of the salary grade midpoint for
the chief executive officer's job. Based on this formula, the chief executive
officer was granted stock options for 38,100 shares in 1994. While Firstar
employs a formula approach to the granting of stock options, in the event of
poor corporate performance, the Committee could elect not to award options. In
15
<PAGE> 18
the judgment of the Committee, based upon the absolute and relative performance
of Firstar as discussed in the Base Salary section above, Firstar's performance
warranted granting of options in 1994.
Deductibility of Executive Compensation
As noted in this report, Firstar has developed a comprehensive program
directly linking executive compensation to Firstar's financial performance in
order to retain and attract executives who can lead Firstar to achieve
shareholder goals. To the extent achieving these goals is consistent with
favorable tax treatment under Section 162(m) of the Internal Revenue Code, the
Compensation Committee is committed to making awards under the executive
compensation plans that will qualify for the performance-based tax expense
deduction.
Conclusions
The Compensation Committee believes that the programs described above,
driven by its statement of philosophy, provide a direct link between executive
compensation and Firstar's financial performance and resultant stock price
appreciation.
Compensation Committee
<TABLE>
<S> <C>
Guy A. Osborn, Chairman
James L. Forbes Sheldon B. Lubar
Jerry M. Hiegel Daniel F. McKeithan, Jr.
</TABLE>
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
Messrs. Osborn, Forbes, Hiegel, Lubar and McKeithan were the only persons
who served on the Compensation Committee of the Board of Directors of Firstar
during 1994.
16
<PAGE> 19
PERFORMANCE GRAPHS
The following graph shows the cumulative return on a $100 investment in
Firstar common stock over a five year period. Also shown for comparison is the
performance of the KBW 50 Index and the S&P 500 Stock Index. The KBW 50 Index is
a banking industry comprised of 50 companies representing all money center banks
and most major regional banks as maintained by Keefe, Bruyette and Woods, Inc.
COMPARISON OF 5-YEAR CUMULATIVE RETURN
FIRSTAR, S&P 500 STOCK INDEX, & KBW 50 INDEX
(WITH DIVIDEND REINVESTMENT)
<TABLE>
<CAPTION>
MEASUREMENT PERIOD
(FISCAL YEAR COVERED) FIRSTAR S&P 500 KBW 50
<S> <C> <C> <C>
1989 100 100 100
1990 91.5 97.74 106.24
1991 161.5 127.4 168.16
1992 217.2 137.12 214.27
1993 216.8 150.91 226.14
1994 198.2 148.56 214.16
</TABLE>
The following graph depicts the return on common equity of Firstar as
compared to the median and top quartile performance of its peer group. The peer
group consists of all domestic bank holding companies ranging in size from
$10-$25 billion as obtained from Thomson BankWatch, Inc., a nationally
recognized banking industry consultant. This peer group measurement of return on
equity is used in the determination of bonus and long-term incentive plan awards
to executive officers as described in the previous section entitled Board
Compensation Committee Report on Executive Compensation.
COMPARISON OF RETURN ON COMMON EQUITY
<TABLE>
<CAPTION>
MEASUREMENT PERIOD PEER TOP
(FISCAL YEAR COVERED) FIRSTAR QUARTILE PEER MEDIAN
<S> <C> <C> <C>
1989 (1) 16.6 15.9 14.2
1990 (1) 16.4 14.5 12.7
1991 15.9 15.3 12.8
1992 17.4 17.1 14.2
1993 18.6 18.1 15.8
1994 17 17.13 15.84
</TABLE>
(1) Firstar's data is not restated for pooling of interests acquisition
occurring in 1991.
(2) Peer group data is for $5 to $10 billion companies in 1989 and 1990, and $10
to $25 billion in 1991 to 1994.
17
<PAGE> 20
ADDITIONAL INFORMATION ON MANAGEMENT
During the past year, all of the directors and officers and one or more of
their associates were customers of and had business transactions with one or
more bank subsidiaries of Firstar. All loans included in such transactions were
made in the ordinary course of business and on substantially the same terms,
including interest rates and collateral, as those prevailing at the same time
for comparable transactions with other persons, and did not involve more than
normal risk of collectability or present other unfavorable features. It is
expected that similar transactions will occur in the future.
Section 16 of the Securities Exchange Act requires Firstar's executive
officers, directors and more than ten percent shareholders and certain trusts
affiliated with such persons ("Insiders") to file with the Securities and
Exchange Commission and Firstar reports of their ownership of Firstar
securities. Based upon written representations and copies of reports furnished
to Firstar by Insiders, all Section 16 reporting requirements applicable to
Insiders during 1994 were satisfied on a timely basis.
SHAREHOLDER PROPOSALS AND DISCUSSIONS
If any shareholder of Firstar wishes to submit a proposal to be included in
next year's proxy statement and acted upon at the annual meeting of Firstar to
be held in 1996, the proposal must be received by the Secretary of Firstar at
the principal executive offices of Firstar, 777 East Wisconsin Avenue,
Milwaukee, Wisconsin 53202, prior to the close of business on November 29, 1995.
Firstar's By-laws establish advance notice procedures as to (1) business to be
brought before an annual meeting of shareholders other than by or at the
direction of the Board of Directors, (2) the nomination, other than by or at the
direction of the Board of Directors, of candidates for election as directors and
(3) the request to call a special meeting of shareholders. Any shareholder who
wishes to take such action should obtain a copy of these By-laws and may do so
by written request addressed to the Secretary of Firstar at the principal
executive offices of Firstar.
SELECTION OF AUDITORS
The Board of Directors, upon recommendation of the Audit-Examining
Committee, has selected KPMG Peat Marwick LLP as Firstar's independent auditors
for 1995. The firm has served Firstar as auditors during the previous year.
Representatives of KPMG Peat Marwick LLP are expected to be present at the
shareholders' meeting with the opportunity to make statements if they so desire
and to be available to respond to appropriate questions raised orally at the
meeting.
18
<PAGE> 21
GENERAL
The management does not intend to present to the meeting any other matters
not referred to above and does not presently know of any matters that may be
presented to the meeting by others. However, if other matters come before the
meeting, it is the intention of the persons named in the enclosed form of proxy
to vote the proxy in accordance with their best judgment in the interest of
Firstar. The receipt of any report which may be submitted to the meeting is not
to constitute approval or disapproval of any matters referred to in such report
or reports. Firstar's Form 10-K annual report, including financial statements
for the year ended December 31, 1994, has been provided with this notice of the
1995 annual meeting and proxy statement.
By order of the Board of Directors.
William J. Schulz
Senior Vice President and Secretary
March 20, 1995
TO ASSURE THAT YOUR SHARES ARE REPRESENTED AT THE MEETING, PLEASE COMPLETE,
DATE, SIGN AND MAIL PROMPTLY THE ENCLOSED PROXY CARD FOR WHICH A RETURN ENVELOPE
IS PROVIDED.
19
<PAGE> 22
<TABLE>
<S> <C>
PROXY NO. FIRSTAR NO. OF SHARES
THE SHARES REPRESENTED BY THIS PROXY WILL BE VOTED AS DIRECTED OR, IF NO DIRECTION INDICATED, WILL BE
VOTED FOR NOMINEES FOR DIRECTOR NAMED IN ITEM 1.
Dated: ________________________ , 1995 _________________________________________________________
_________________________________________________________
Stockholder'(s) Sign Here
Please sign exactly as your name appears herein, giving
your full title if signing as attorney or fiduciary.
If shares are held jointly, each joint owner should sign.
If a corporation, please sign in full corporate name, by
duly authorized officer. If a partnership, please sign
in partnership name by authorized person.
PLEASE RETURN PROMPTLY IN ENCLOSED ENVELOPE WHICH REQUIRES NO POSTAGE IF MAILED IN THE U.S.
_________________________________________________________________________________________________________________________________
_________________________________________________________________________________________________________________________________
FIRSTAR CORPORATION
777 East Wisconsin Avenue, Milwaukee, Wisconsin 53202
PROXY SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
The undersigned hereby appoints Roger L. Fitzsimonds, John A. Becker and
William J. Schulz and each of them, proxies of the undersigned with power of
substitution, to vote all stock of the undersigned at the annual meeting
of the shareholders of Firstar Corporation, to be held on April 20, 1995,
at 2:00 P.M., and any adjournments thereof, as indicated below:
_________________________________________________________________________________________________________________________________
THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR ITEM 1.
1. ELECTION OF FOR all nominees listed below WITHHOLD AUTHORITY
DIRECTORS (except as marked to the to vote for all nominees
contrary below) _______ listed below ________
NOMINEES FOR TERM EXPIRING IN 1998: Roger H. Derusha, Jerry M. Hiegel, Sheldon B.
Lubar, Daniel F. McKeithan, Jr., George W.
Mead II, Guy A. Osborn, William W. Wirtz
(INSTRUCTION: To withhold authority to vote for any individual nominee, cross out that nominee's name)
2. With discretionary power upon any and all other business that may properly come before the meeting and upon
matters incident to the conduct of the meeting.
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