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
[X] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to Section 240.14a-11(c) or Section
240.14a-12
Total System Services, Inc.
(Name of Registrant as Specified In Its Charter)
Kathleen Moates
(Name of Person(s) Filing Proxy Statement)
Payment of Filing Fee (Check the appropriate box):
[X] $125 per Exchange Act Rules 0-11(c)(1)(ii), 14a-6(i)(1), 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:
2) Form, Schedule or Registration Statement No.:
3) Filing Party:
4) Date Filed:
[LOGO]
Richard W. Ussery
Chairman of the Board
March 10, 1995
Dear Shareholder:
The Annual Meeting of the Shareholders of Total System Services, Inc. will
be held on April 10, 1995, in Room Five of the Columbus Ironworks
Convention and Trade Center, Columbus, Georgia, beginning at 10:00 o'clock
A.M., E.T., for the purposes set forth in the accompanying Notice of Annual
Meeting of Shareholders and Proxy Statement.
We hope that you will be able to be with us and let us give you a review of
1994. Whether you own a few or many shares of stock and whether or not you
plan to attend in person, it is important that your shares be voted on
matters that come before the meeting. To make sure your shares are
represented, we urge you to complete and mail the enclosed Proxy Card
promptly.
Thank you for helping us make 1994 a good year. We look forward to your
continued support in 1995 and another good year.
Sincerely yours,
/s/ Richard W. Ussery
RICHARD W. USSERY
Total System Services, Inc.
Post Office Box 2506
Columbus, Georgia 31902-2506
<PAGE>
[LOGO]
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
To Be Held April 10, 1995
NOTICE IS HEREBY GIVEN that the Annual Meeting of the Shareholders of Total
System Services, Inc.(SM) (``TSYS(R)'') will be held in Room Five of the
Columbus Ironworks Convention and Trade Center, Columbus, Georgia, on
April 10, 1995, at 10:00 o'clock A.M., E.T., for:
(1) The election of five nominees as Class III directors of TSYS to serve
until the 1998 Annual Meeting of Shareholders;
(2) To approve the Synovus Financial Corp. 1994 Long-Term Incentive Plan
(TSYS is an 80.8% owned subsidiary of Synovus Financial Corp.); and
(3) The transaction of such other business as may properly come before the
Annual Meeting.
Information relating to the above matters is set forth in the accompanying
Proxy Statement.
Only shareholders of record at the close of business on February 22, 1995
will be entitled to notice of and to vote at the Annual Meeting.
/s/ K. Michael Sawyer
K. MICHAEL SAWYER
Secretary
Columbus, Georgia
March 10, 1995
WHETHER OR NOT YOU PLAN TO BE PRESENT AT THE ANNUAL MEETING
IN PERSON, PLEASE VOTE, DATE AND SIGN THE ENCLOSED PROXY CARD
AND RETURN IT PROMPTLY IN THE ENCLOSED RETURN ENVELOPE WHICH
DOES NOT REQUIRE ANY POSTAGE IF MAILED IN THE UNITED STATES.
<PAGE>
[LOGO]
PROXY STATEMENT
ANNUAL MEETING OF SHAREHOLDERS
To Be Held April 10, 1995
I. INTRODUCTION
A. Purposes of Solicitation - Terms of Proxies.
The Annual Meeting of the Shareholders (``Annual Meeting'') of Total System
Services, Inc. (``TSYS'') will be held on April 10, 1995 for the purposes
set forth in the accompanying Notice of Annual Meeting of Shareholders and
in this Proxy Statement. The enclosed Proxy Card (``Proxy'') is solicited
BY AND ON BEHALF OF TSYS' BOARD OF DIRECTORS in connection with such Annual
Meeting or any adjournment thereof. The costs of the solicitation of
Proxies by TSYS' Board of Directors will be paid by TSYS. Forms of Proxies
and Proxy Statements will also be distributed through brokers, banks,
nominees, custodians and other like parties to the beneficial owners of
shares of the $.10 par value common stock of TSYS (``TSYS Common Stock''),
and TSYS will reimburse such parties for their reasonable out-of-pocket
expenses therefor. TSYS' mailing address is Post Office Box 2506, Columbus,
Georgia 31902-2506.
The shares represented by the Proxy in the accompanying form, which when
properly executed, returned to TSYS' Board of Directors and not revoked,
will be voted in accordance with the instructions specified in such Proxy.
If a choice is not specified in the Proxy, the shares represented by such
Proxy will be voted ``FOR'' the election of the five nominees for Class III
directors named herein and in accordance with the recommendations of the
Board of Directors on the other matters brought before the Meeting.
Each Proxy granted may be revoked in writing at any time before the
authority granted thereby is exercised. Attendance at the Annual Meeting
will constitute a revocation of the Proxy for such Meeting if the maker
thereof elects to vote in person.
This Proxy Statement and the enclosed Proxy are being first mailed to
shareholders on or about March 10, 1995.
B. TSYS Securities Entitled to Vote and Record Date.
TSYS' outstanding voting securities are TSYS Common Stock, each share of
which entitles the holder thereof to one vote on any matter coming before a
meeting of TSYS' shareholders. Only shareholders of record at the close of
business on February 22, 1995 are entitled to vote at the Annual Meeting or
any adjournment thereof. As of that date, there were 64,631,294 shares of
TSYS Common Stock outstanding and entitled to vote. TSYS owned 97,400
shares of TSYS Common Stock on February 22, 1995 as treasury shares, which
are not considered to be outstanding and are not entitled to be voted at
the Annual Meeting.
C. Shareholder Proposals.
From time to time, TSYS' shareholders may present proposals which may be
proper subjects for inclusion in TSYS' Proxy Statement for consideration at
TSYS' Annual Meeting. To be considered for inclusion, shareholder proposals
must be submitted on a timely basis. Proposals for TSYS' 1996 Annual
Meeting, which has been tentatively scheduled for April 8, 1996, must be
received by TSYS no later than November 12, 1995, and any such proposals,
as well as any questions related thereto, should be directed to the
Secretary of TSYS.
D. Columbus Bank and Trust Company.
Columbus Bank and Trust Company (``CB&T'') owned individually 52,200,646
shares, or 80.8%, of the outstanding shares of TSYS Common Stock on
February 22, 1995. CB&T(SM) is a wholly-owned banking subsidiary of Synovus
Financial Corp.(R) (``Synovus''), a multi-financial services company having
67,809,520 shares of $1.00 par value voting common stock (``Synovus Common
Stock'') outstanding on February 22, 1995.
II. ELECTION OF DIRECTORS
A. Information Concerning Number and Classification of Directors and
Nominees.
(1) Number and Classification of Directors.
In accordance with the vote of shareholders taken at TSYS' 1988 Annual
Meeting, the number of members of TSYS' Board of Directors was fixed at 18.
TSYS' Board of Directors is currently comprised of 16 members, and TSYS has
two directorships which remain vacant, one of which positions was made
vacant by the ascension of a Class II director to emeritus status. Both
vacant directorships could be filled in the future at the discretion of
TSYS' Board of Directors. This discretionary power gives TSYS' Board of
Directors the flexibility of appointing new directors in the periods
between TSYS' Annual Meetings should suitable candidates come to its
attention. Any person appointed by TSYS' Board of Directors to fill the
vacant Class II directorship would serve the remainder of the Class II
term, which expires at the 1997 Annual Meeting. Any person so appointed by
TSYS' Board of Directors to the remaining vacant directorship would not be
appointed to serve a classified, three-year term but would only serve as a
director until the next succeeding Annual Meeting. At such Annual Meeting,
such appointee would stand before TSYS' shareholders for election to a
classified term of office as a director. Proxies cannot be voted at the
1995 Annual Meeting for a greater number of persons than the number of
nominees named.
Pursuant to TSYS' Articles of Incorporation and bylaws, the members who
comprise TSYS' Board of Directors are divided into three classes of
directors: Class I, Class II and Class III directors, with each of such
Classes of directors to be as nearly equal in number as possible. Each
Class of directors serves a staggered 3-year term. At TSYS' 1994 Annual
Meeting, Class II directors were elected to serve 3-year terms to expire at
TSYS' 1997 Annual Meeting, and at TSYS' 1993 Annual Meeting, Class I
directors were elected to serve 3-year terms to expire at TSYS' 1996 Annual
Meeting. The terms of office of the Class III directors expire at TSYS'
1995 Annual Meeting.
(2) Nominees for Class III Directors and Vote Required.
TSYS' Board of Directors has selected five nominees which it proposes for
election to TSYS' Board as Class III directors. The five nominees for Class
III directors of TSYS will be elected to serve 3-year terms that will
expire at TSYS' 1998 Annual Meeting. The five nominees for Class III
directors of TSYS are: Salvador Diaz-Verson, Jr., Mason H. Lampton, William
B. Turner, George C. Woodruff, Jr. and James D. Yancey.
Under TSYS' bylaws and Georgia law, a majority of the issued and
outstanding shares of TSYS Common Stock entitled to vote must be
represented at the 1995 Annual Meeting in order to constitute a quorum and
all shares represented at the Meeting, including shares abstaining and
withholding authority, are counted for purposes of determining whether a
quorum exists. The nominees for election as directors at the Annual Meeting
who receive the greatest number of votes (a plurality), a quorum being
present, shall become directors at the conclusion of the tabulation of
votes. Thus, once a quorum has been established, abstentions and broker
non-votes have no effect upon the election of directors. The shares
represented by Proxies executed for TSYS' 1995 Annual Meeting in such
manner as not to withhold authority to vote for the election of any nominee
for election as a Class III director on TSYS' Board of Directors shall be
voted ``FOR'' the election of the five nominees for Class III directors on
TSYS' Board named herein.
If any nominee for Class III director of TSYS becomes unavailable for any
reason before TSYS' 1995 Annual Meeting, the shares represented by executed
Proxies may be voted for such substitute nominee as may be determined by
the holders of such Proxies. It is not anticipated that any nominee will be
unavailable for election.
TSYS' BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS A VOTE ``FOR'' EACH OF THE
FIVE NOMINEES FOR ELECTION AS CLASS III DIRECTORS ON TSYS' BOARD SET FORTH
HEREIN.
B. Information Concerning Directors and Nominees for Class III Directors.
(1) General Information.
The following sets forth the name, age, principal occupation and employment
(which, except as noted, has been for the past five years) of each of the
nominees for election as Class III directors of TSYS and the remaining
directors presently serving on TSYS' Board of Directors, his director
classification, his length of service as a director of TSYS, any family
relationships with other directors or executive officers of TSYS, and any
Board of Directors of which he is a member with respect to any company with
a class of securities registered with the Securities and Exchange
Commission (``SEC'') pursuant to Section 12 of the Securities Exchange Act
of 1934, as amended (``Exchange Act''), including Synovus, or any company
which is subject to the requirements of Section 15(d) of that Act, or any
company registered with the SEC as an investment company under the
Investment Company Act of 1940 (``Public Company'').
<TABLE>
<CAPTION>
TSYS Director Principal Occupation
Classification and Other Directorships
Name Age <F1> of Public Companies
<S> <C> <C> <C>
Griffin B. Bell 76 I Senior Partner, King &
Spalding (Law Firm).
James H. Blanchard 53 II Chairman of the Board,
Synovus Financial Corp.,
and Chairman of the
Executive Committee,
Total System Services,
Inc. Director, BellSouth
Corporation.
Richard Y. Bradley <F2> 56 II President, Bickerstaff
Clay Products Company, Inc.
(Brick and Concrete Block
Manufacturer). Director,
Synovus Financial Corp.
Salvador
Diaz-Verson, Jr. <F3> 43 III Chairman of the Board,
Diaz-Verson Capital Invest-
ments, Inc. (Investments and
Money Management). Chairman of
the Board, Diaz-Verson Funds
Inc. Director, Clemente
Capital, Inc. and Synovus
Financial Corp.
Kenneth E. Evans <F4> 46 I Vice Chairman of the Board,
Total System Services,Inc.
Gardiner W. Garrard, Jr. 54 II President, The Jordan Company
(Real Estate Development).
Director, Synovus Financial Corp.
John P. Illges, III 60 II First Vice President and
Financial Consultant, The
Robinson-Humphrey Co., Inc.
(Stockbroker). Advisory
Director, Synovus Financial Corp.
Mason H. Lampton 47 III President, The Hardaway
Company (Construction
Company). Director, Synovus
Financial Corp.
William M. McVay 56 I Senior Vice President
(Retired), Columbus Bank and
Trust Company.
W. Walter Miller, Jr.<F5> 47 II Senior Vice President, Total
System Services, Inc.
H. Lynn Page 54 I Vice Chairman of the Board
(Retired) and Director,
Synovus Financial Corp.,
Columbus Bank and Trust
Company and Total System
Services, Inc.
Philip W. Tomlinson <F6> 48 I President, Total System
Services, Inc.
William B. Turner <F5> 72 III Chairman of the Executive
Committee, W.C. Bradley Co.
(Metal Manufacturer and Real
Estate), and Chairman of the
Board, Columbus Bank and Trust
Company. Director, The
Coca-Cola Company. Chairman of
the Executive Committee,
Synovus Financial Corp.
Richard W. Ussery <F7> 47 I Chairman of the Board, Total
System Services, Inc.
George C. Woodruff, Jr. 66 III Real Estate and Personal
Investments. Director, Synovus
Financial Corp. and United
Cities Gas Company.
James D. Yancey <F8> 53 III Vice Chairman of the Board,
Synovus Financial Corp.
and Columbus Bank and Trust Company
<FN>
<F1> All of the directors of TSYS, except Salvador Diaz-Verson, Jr., Mason
H. Lampton, James D. Yancey, Griffin B. Bell, Kenneth E. Evans, Richard Y.
Bradley and W. Walter Miller, Jr., have continuously served as directors of
TSYS since December 22, 1982, the date of incorporation and organization of
TSYS. Mr. Diaz-Verson was elected a director of TSYS at its 1983 Annual
Meeting held on June 14, 1983. Mr. Lampton was elected as a director of
TSYS by TSYS' Board of Directors on January 21, 1986. Mr. Yancey served as
a director of TSYS from December 22, 1982, until December 15, 1987, at
which time he was appointed an Advisory Director of TSYS. Mr. Bell was
elected a director of TSYS on December 15, 1987 to serve the unexpired
Class I term of Mr. Yancey. Mr. Yancey was reelected as a director of TSYS
on February 16, 1988 to serve the unexpired Class III term of Richard H.
Bickerstaff, who retired from TSYS' Board, and was appointed an Emeritus
Director of TSYS. Mr. Evans was elected a director of TSYS by TSYS'
Executive Committee on January 30, 1990. Mr. Bradley was elected a director
of TSYS by TSYS' Board of Directors on February 11, 1991. Mr. Miller was
elected a director of TSYS by TSYS' Board of Directors on April 12, 1993.
<F2> Richard Y. Bradley was elected President of Bickerstaff Clay Products
Company, Inc. in January, 1991. Until 1991, Mr. Bradley was a partner in
the law firm of Hatcher, Stubbs, Land, Hollis and Rothschild.
<F3> Salvador Diaz-Verson, Jr. founded Diaz-Verson Capital Investments,
Inc. in September, 1991. From 1985 until 1991, Mr. Diaz-Verson, Jr. was
President of AFLAC Incorporated.
<F4> Kenneth E. Evans was elected Vice Chairman of the Board of TSYS in
February, 1992. From 1990 until 1992, Mr. Evans served as Executive Vice
President of TSYS. From 1986 until 1990, Mr. Evans served as Executive Vice
President and Secretary of Synovus and CB&T.
<F5> W. Walter Miller, Jr. was elected as Senior Vice President of TSYS in
October, 1990. From 1974 until 1990, Mr. Miller served in various
capacities with CB&T, including Senior Vice President. Mr. Miller's spouse
is the niece of William B. Turner.
<F6> Philip W. Tomlinson was elected President of TSYS in February, 1992.
From 1982 until 1992, Mr. Tomlinson served as Executive Vice President of
TSYS.
<F7> Richard W. Ussery was elected Chairman of the Board of TSYS in
February, 1992. From 1982 until 1992, Mr. Ussery served as President of
TSYS.
<F8> James D. Yancey was elected Vice Chairman of the Board of Synovus in
March, 1992. From 1983 until 1992, Mr. Yancey served in various positions
with Synovus and CB&T, including Vice Chairman of the Board and President
of both Synovus and CB&T.
</TABLE>
(2) TSYS Common Stock Ownership of Directors, Nominees and Management.
The following table sets forth, as of January 31, 1995, the number of
shares of TSYS Common Stock beneficially owned by each of TSYS' executive
officers, directors and nominees for election as Class III directors.
Information relating to beneficial ownership of TSYS Common Stock is based
upon information furnished by each person or entity using ``beneficial
ownership'' concepts set forth in the rules of the SEC under Section 13(d)
of the Exchange Act.
<PAGE>
<TABLE>
<CAPTION> Shares of TSYS Shares of TSYS Shares of TSYS Percentage of
Common Stock Common Stock Common Stock Outstanding
Beneficially Beneficially Beneficially Shares of
Owned with Owned with Owned with Shares of TSYS Common
Sole Voting Shared Voting Sole Voting but TSYS Stock Stock
and Investment and Investment no Investment Beneficially Beneficially
Power as of Power as of Power as of Owned as of Owned as of
Name 1/31/95 1/31/95 1/31/95 1/31/95 1/31/95
<S> <C> <C> <C> <C> <C>
Griffin B. Bell 21,928 2,000 ----- 23,928 0.04%
James H. Blanchard 259,689 120,450 ----- 380,139 0.59
Richard Y. Bradley 5,423 ----- ----- 5,423 0.01
Salvador Diaz-Verson, Jr. 18,138 1,800 ----- 19,938 0.03
Kenneth E. Evans 45,080 ----- 64,120 109,200 0.17
Gardiner W. Garrard, Jr. 2,555 ----- ----- 2,555 .004
John P. Illges, III 60,659 ----- ----- 60,659 0.09
Mason H. Lampton 8,512 33,840 ----- 42,352 0.07
James B. Lipham 13,993 ----- 16,640 30,633 0.05
William M. McVay 60,789 ----- ----- 60,789 0.09
W. Walter Miller, Jr. 13,652 4,068 16,640 34,360 0.05
H. Lynn Page 238,662 31,882 ----- 270,544 0.42
William A. Pruett 49,533 ----- 20,800 70,333 0.11
Philip W. Tomlinson 194,956 ----- 80,844 275,800 0.30
William B. Turner 49,562 192,000 ----- 241,562 0.37
Richard W. Ussery 191,700 2,900 87,344 281,944 0.44
George C. Woodruff, Jr. 35,135 ----- ----- 35,135 0.05
James D. Yancey 290,280 8,000 ----- 298,280 0.46
</TABLE>
The following table sets forth information, as of January 31, 1995, with
respect to the beneficial ownership of TSYS Common Stock by all directors,
nominees and executive officers of TSYS as a group.
<PAGE>
<TABLE>
Percentage of
<CAPTION> Shares of Outstanding Shares of
TSYS Common Stock TSYS Common Stock
Name of Beneficially Owned Beneficially Owned
Beneficial Owner as of 1/31/95 as of 1/31/95
<S> <C> <C>
All directors,
nominees and executive
officers of TSYS
as a group 2,250,047 3.48%
(includes
19 persons)
</TABLE>
For a detailed discussion of the beneficial ownership of Synovus Common
Stock of TSYS' named executive officers, directors and nominees and of all
directors, nominees and executive officers of TSYS as a group, see Section
V(C) hereof captioned ``Synovus Common Stock Ownership of Directors,
Nominees and Management.''
C. Board Committees and Attendance.
The business and affairs of TSYS are under the direction of TSYS' Board of
Directors. During 1994, TSYS' Board of Directors held six regular meetings
and two special meetings. During 1994, each of TSYS' incumbent directors
attended at least 75% of the meetings of TSYS' Board of Directors and the
committees thereof on which he sat.
TSYS' Board of Directors has three principal standing committees -- an
Executive Committee, an Audit Committee and a Compensation Committee. There
is no Nominating Committee of TSYS' Board of Directors.
Executive Committee. The members of TSYS' Executive Committee are: James H.
Blanchard, Chairman, Richard W. Ussery, Philip W. Tomlinson, William B.
Turner, James D. Yancey, Gardiner W. Garrard, Jr., Richard Y. Bradley and
Kenneth E. Evans. During the intervals between meetings of TSYS' Board of
Directors, TSYS' Executive Committee possesses and may exercise any and all
of the powers of TSYS' Board of Directors in the management and direction
of the business and affairs of TSYS with respect to which specific
direction has not been previously given by TSYS' Board of Directors. During
1994, TSYS' Executive Committee did not meet.
Audit Committee. The members of TSYS' Audit Committee are: Gardiner W.
Garrard, Jr., Chairman, Mason H. Lampton and Salvador Diaz-Verson, Jr. The
primary functions to be engaged in by TSYS' Audit Committee include: (i)
annually recommending to TSYS' Board the independent certified public
accountants (``Independent Auditors'') to be engaged by TSYS for the next
fiscal year; (ii) reviewing the plan and results of the annual audit by
TSYS' Independent Auditors; (iii) reviewing and approving the range of
management advisory services provided by TSYS' Independent Auditors; (iv)
reviewing TSYS' internal audit function and the adequacy of the internal
accounting control systems of TSYS; (v) reviewing the results of regulatory
examinations of TSYS; (vi) periodically reviewing the financial statements
of TSYS; and (vii) considering such other matters with regard to the
internal and independent audit of TSYS as, in its discretion, it deems to
be necessary or desirable, periodically reporting to TSYS' Board as to the
exercise of its duties and responsibilities and, where appropriate,
recommending matters in connection with the audit function with respect to
which TSYS' Board should consider taking action. During 1994, TSYS' Audit
Committee held six meetings.
Compensation Committee. The members of the Compensation Committee of TSYS'
Board of Directors are: William B. Turner, Chairman, George C. Woodruff,
Jr. and Gardiner W. Garrard, Jr. The primary functions to be engaged in by
TSYS' Compensation Committee include: (i) evaluating the remuneration of
senior management and board members of TSYS and its subsidiaries and the
compensation and fringe benefit plans in which officers, employees and
directors of TSYS are eligible to participate; and (ii) recommending to
TSYS' Board whether or not it should modify, alter, amend, terminate or
approve such remuneration, compensation or fringe benefit plans. During
1994, TSYS' Compensation Committee held four meetings.
D. Executive Officers.
The following table sets forth the name, age and position with TSYS of each
executive officer of TSYS.
<PAGE>
<TABLE>
<CAPTION>
Name Age Position with TSYS
<S> <C> <C>
James H. Blanchard 53 Chairman of the Executive Committee
Richard W. Ussery 47 Chairman of the Board
Kenneth E. Evans 46 Vice Chairman of the Board
Philip W. Tomlinson 48 President
William A. Pruett 41 Executive Vice President
James B. Lipham 46 Senior Vice President
and Chief Financial Officer
G. Sanders Griffith, III 41 General Counsel
</TABLE>
All of the executive officers of TSYS are members of TSYS' Board of
Directors, except William A. Pruett, James B. Lipham and G. Sanders
Griffith, III. William A. Pruett was elected as Executive Vice President of
TSYS in February, 1993. From 1976 until 1993, Mr. Pruett served in various
capacities with CB&T and/or TSYS, including Senior Vice President. James B.
Lipham was elected as Senior Vice President and Chief Financial Officer of
TSYS in December, 1991. From 1984 until 1991, Mr. Lipham served in various
financial capacities with Synovus and/or TSYS, including Vice President and
Treasurer. G. Sanders Griffith, III has served as General Counsel of TSYS
since 1988. Mr. Griffith currently serves as Executive Vice President,
General Counsel and Secretary of Synovus and has held various positions
with Synovus since 1988.
All of the executive officers of TSYS serve at the pleasure of TSYS' Board
of Directors. There are no family relationships between any of TSYS'
executive officers, and there are no arrangements or understandings between
any such executive officer or any other person pursuant to which any such
officer was elected.
III. DIRECTORS' PROPOSAL TO APPROVE THE SYNOVUS FINANCIAL CORP. 1994
LONG-TERM INCENTIVE PLAN
TSYS' compensation program includes long-term performance awards under the
Synovus Financial Corp. 1994 Long-Term Incentive Plan (the ``1994 Plan'').
The purpose of the 1994 Plan is to attract, retain, motivate and reward
employees who make a significant contribution to Synovus and its
subsidiaries' (including TSYS) long-term success, and to enable such
employees to acquire and maintain an equity interest in Synovus. Subject to
approval by TSYS' shareholders, compensation paid to TSYS' employees
pursuant to the 1994 Plan is intended, to the extent reasonable, to qualify
for tax deductibility under Section 162(m) of the Internal Revenue Code of
1986, as amended, and the regulations promulgated thereunder, as may be
amended from time to time (``Section 162(m)'').
Eligibility and Participation. Any employee of Synovus or its subsidiaries
(including TSYS), excluding members of the Compensation Committee and any
director who is not also an employee of Synovus, is eligible to be selected
to participate in the 1994 Plan. Approximately 300 employees currently
participate in the 1994 Plan. The Committee, as described below, has
discretion to select participants from among eligible employees from year
to year.
Shares Subject to the Plan. The aggregate number of shares of Synovus
Common Stock which may be granted to participants pursuant to awards
granted under the 1994 Plan may not exceed three million (3,000,000),
determined in accordance with the 1994 Plan.
Awards Under the 1994 Plan. Pursuant to the 1994 Plan, Synovus may grant
long-term perform ance awards to participants in the form of stock options,
stock appreciation rights (``SARs''), restricted stock or performance
awards.
Stock Options. The Committee may grant options under the 1994 Plan in the
form of qualified incentive stock options (``ISOs''), nonqualified stock
options (``NQSOs'') or a combination thereof. Options may be granted either
alone or in tandem with other awards granted under the 1994 Plan. Subject
to the limits described herein, the Committee shall have discretion in
determining the number of shares subject to options granted to each
participant.
The option price of NQSOs may be equal to, or more or less than, one
hundred percent (100%) of the fair market value of a share of Synovus
Common Stock on the date the option is granted. The option price of ISOs
shall be at least equal to one hundred percent (100%) of the fair market
value of a share of Synovus Common Stock on the date the option is granted.
Options shall expire at such times as the Committee determines at the time
of grant; provided, however, that no option shall be exercisable later than
the tenth anniversary of its grant.
Options granted under the 1994 Plan shall be exercisable at such times and
subject to such restrictions and conditions as the Committee shall approve;
provided that no option may be exercisable prior to six months following
its grant. The option exercise price shall be payable in cash, by check, or
by such other instrument as deemed acceptable by the Committee. Payment of
the exercise price and any withholding tax due at exercise may also be made
through any program approved by the Committee (including a broker-dealer
cashless exercise program).
Options may only be transferred under the laws of descent and distribution
and shall be exercisable only by the participant during his lifetime. The
participant's rights in the event of termination of employment shall be
specified by the Committee at the date of grant.
Subject to the terms of the 1994 Plan, the Committee may grant option price
adjustment rights (``Adjustment Rights'') in conjunction with all or part
of any option granted under the 1994 Plan, either at or after the time of
grant of the option. Such Adjustment Rights are exercisable only at the
same time and to the same extent as the corresponding option, and shall
terminate upon the termination or exercise of such option. Upon exercise,
the participant shall be entitled to have applied as a credit against the
exercise price of the related option an amount equal to the total number of
shares subject to the Adjustment Right (or a portion thereof as designated
by the participant), multiplied by a fixed percentage of the fair market
value of a share of Synovus Common Stock on a date designated by the
Committee.
Stock Appreciation Rights. SARs granted under the 1994 Plan may be granted
alone or in conjunction with all or part of any option granted under the
1994 Plan. Subject to the terms of the 1994 Plan, the Committee shall have
discretion to determine the terms and conditions of any SAR granted under
the 1994 Plan. With respect to an SAR granted in conjunction with an
option, the grant price shall be equal to the option price of the related
option, and such SAR shall terminate upon the termination or exercise of
the related option. No SAR granted under the 1994 Plan may be exercisable
prior to six months following its grant, except in the case of death (other
than by suicide) or disability of the participant. The term of any SAR
shall be determined by the Committee, provided that such term may not
exceed ten years.
SARs granted alone may be exercised upon the terms and conditions as are
imposed by the Committee. An SAR granted in conjunction with an option may
be exercised only with respect to the shares of Common Stock of Synovus for
which the related option is exercisable. SARs granted in connection with an
ISO shall expire no later than the expiration of such ISO, the value of the
payout for such SARs may be no more than one hundred percent (100%) of the
difference between the ISO option price and the fair market value of the
shares subject to such ISO at exercise, and may be exercised only when the
fair market value of the shares subject to the ISO exceeds the ISO option
price.
Upon exercise, a participant will receive the difference between the fair
market value of a share of Common Stock on the date of exercise and the
grant price multiplied by the number of shares with respect to which the
SAR is exercised. Payment due upon exercise may be in cash, in shares
having a fair market value of the SAR being exercised, or in a combination
of cash and shares, as determined by the Committee. The Committee may
impose such restrictions on the exercise of SARs as may be required to
satisfy the requirements of Section 16 of the Exchange Act. SARs may only
be transferred under the laws of descent and distribution and shall be
exercisable only by the participant during his lifetime.
Restricted Stock. Restricted stock may be granted in such amounts and
subject to such terms and conditions as determined by the Committee. The
Committee shall impose such conditions and/or restrictions on any shares of
restricted stock as it deems advisable, including, but not limited to, a
graduated vesting schedule and/or conditioning the grant of restricted
stock on the attainment of performance goals. Each participant who is
awarded restricted stock shall be issued a stock certificate in respect of
such restricted stock, which shall be held in escrow by an escrow agent
designated by the Committee, as provided under the 1994 Plan.
During the six month period following the date of grant of restricted
stock, or such longer period as may be determined by the Committee,
restricted stock may not be sold, transferred, pledged or assigned during
the period of six months following the date of its grant. Except as limited
by the 1994 Plan, the Committee may provide for the lapse of such
restrictions or may accelerate or waive such restrictions based on
performance or such other factors as determined by the Committee.
Participants holding restricted stock shall have all of the rights of
stockholders of Synovus, including the right to dividends, unless the
Committee determines otherwise at the time of grant. Dividends or
distributions credited during the restriction period and paid in shares
shall be subject to the same restrictions as the shares of restricted stock
with respect to which they were paid. All rights with respect to restricted
stock shall be available only during a participant's lifetime, and each
restricted stock award agreement shall specify the participant's right to
receive unvested restricted shares in the event of termination of
employment.
Performance Awards. Shares of stock and/or a payment in cash may be awarded
under the 1994 Plan in the amounts and subject to the terms and conditions
as determined by the Committee. The Committee may set performance
objectives which, depending on the extent to which they are met, will
determine the value of Performance Awards that will be paid out to
participants. Participants shall receive payment of Performance Awards
earned, in cash and/or shares of Common Stock, if the specified performance
objectives have been obtained. The Committee may also establish a minimum
level of performance below which no Performance Award may be payable.
In the event a participant's employment is terminated by reason of death
(other than by suicide), disability, or retirement during a performance
period, the participant shall receive a prorated payout of the Performance
Award at the time and in the amount determined by the Committee. In the
event employment is terminated for any other reason, the Participant's
rights to any Performance Award shall be forfeited. Performance Awards may
not be sold, transferred, pledged, assigned, or otherwise alienated or
hypothecated, other than by will or by the laws of descent and
distribution. A participant's rights under the 1994 Plan shall be
exercisable only by the participant during his lifetime.
Objective Performance Measures. Performance objectives applicable to awards
granted under the 1994 Plan, as determined by the Committee, shall be
chosen from among the following alternatives, unless and until the
Committee proposes a change in such measures for shareholder vote or
applicable tax and/or securities laws change to permit Committee discretion
to alter such performance measures without obtaining shareholder approval:
(i) total shareholder return; (ii) return on equity; (iii) earnings per
share growth; and (iv) return on assets.
Maximum Amount Payable to Any Participant. The maximum number of shares
which may be awarded in any calendar year to any one participant is two
hundred thousand (200,000). The maximum cash amount which may be awarded in
any calendar year to any participant is $1 million.
Adjustments in Connection With Certain Events. The 1994 Plan provides that
the Committee shall make a substitution or adjustment in the number of
shares reserved for issuance under the 1994 Plan in the number and option
price of shares subject to outstanding options and in the number of shares
subject to SARs, restricted stock, or Performance Awards, as it deems
appropriate and equitable in connection with a change in corporate
structure affecting Synovus' stock.
Duration of the 1994 Plan. The 1994 Plan shall remain in effect from the
date it is adopted by Synovus' Board until the date terminated by the
Committee or Synovus' Board of Directors; provided, however, that no award
shall be granted on or after the tenth anniversary of the 1994 Plan's
effective date. Provided further, however, that no future awards will be
granted to TSYS' Covered Employees, as defined below, unless shareholder
approval of the 1994 Plan is obtained.
Administration. The 1994 Plan will be administered by a committee of the
Board of Directors of Synovus (the ``Committee'') which will be comprised
of no fewer than two members who must be ``outside directors'' within the
meaning of Section 162(m). Initially, the administering committee shall be
the Compensation Committee of Synovus' Board.
The Committee shall have authority to: (i) determine individuals to whom
awards will be granted; (ii) determine the terms and conditions upon which
awards shall be granted, including any restriction based on performance or
other factors; (iii) determine whether and to what extent awards shall be
deferred; and (iv) make all other determinations, perform all other acts,
exercise all other powers, and establish any other procedures it deems
necessary, appropriate or advisable in administering the 1994 Plan and
maintaining compliance with applicable law. In accordance with its
responsibility to evaluate the remuneration of TSYS' Senior Management,
TSYS' Compensation Committee reviews and approves all awards made to TSYS'
employees.
Amendment of the 1994 Plan. Synovus' Board of Directors may amend, alter or
discontinue the 1994 Plan at any time except that no such amendment,
suspension or discontinuation of the 1994 Plan may affect an existing award
under the 1994 Plan without the affected participant's consent. In
addition, no amendment, alteration or discontinuation shall be made,
without the approval of share holders, which would: (i) increase the total
number of shares reserved under the 1994 Plan; (ii) decrease the option
price of any option to less than one hundred percent (100%) of the fair
market value of a share on the date of grant; (iii) change the participants
or class of participants eligible to participate in the 1994 Plan; or (iv)
materially increase the benefits accruing to participants.
Change in Control. In the event of a change in control of Synovus, as
defined in the 1994 Plan, the vesting of any outstanding awards granted
under the 1994 Plan shall be accelerated and all such awards shall be fully
exercisable.
Federal Income Tax Consequences of the 1994 Plan. The income tax
consequences under current federal tax law to participants and to Synovus
and its subsidiaries of incentive compensation awarded under the 1994 Plan
is generally as described below. Local and state tax authorities, however,
may also tax incentive compensation awarded under the 1994 Plan.
Consequences to Participants. Generally, for federal income tax purposes, a
participant will realize ordinary income and will incur tax liability upon
receipt of the payment of an award under the 1994 Plan in an amount equal
to such payment, if in cash, or the fair market value of any unrestricted
shares of stock received. The tax consequences to participants of the
individual types of awards which may be granted under the 1994 Plan are
described below.
(i) QUALIFIED INCENTIVE STOCK OPTIONS. With respect to options which
qualify as ISOs, a participant will not recognize ordinary income for
federal income tax purposes at the time options are granted or exercised.
If the participant disposes of shares acquired by exercise of an ISO before
the expiration of two years from the date the options are granted, or
within one year after the issuance of shares upon exercise of the ISO, the
participant will recognize in the year of disposition: (a) ordinary income,
to the extent that the lesser of either (1) the fair market value of the
shares on the date of option exercise or (2) the amount realized on
disposition exceeds the option price; and (b) capital gain (or loss), to
the extent that the amount realized on disposition differs from the fair
market value of the shares on the date of option exercise. If the shares
are sold after expiration of these holding periods, the participant will
realize capital gain or loss (assuming the shares are held as capital
assets) equal to the difference between the amount realized on disposition
and the option price.
(ii) NONQUALIFIED STOCK OPTIONS. With respect to options which do not
qualify as ISOs, the participant will recognize no income upon grant of the
option and, upon exercise, will recognize ordinary income to the extent of
the difference between the amount paid by the participant for the shares
and the fair market value of the shares on the date of option exercise.
Upon a subsequent disposition of the shares received under the option, the
participant will recognize capital gain or loss, as the case may be, to the
extent of the difference between the fair market value of the shares at the
time of exercise and the amount realized on the disposition (assuming the
shares are held as capital assets).
(iii) STOCK APPRECIATION RIGHTS. Ordinary income will be recognized by a
participant upon the exercise of a SAR, in an amount equal to the cash
received or the fair market value of the shares received on the exercise
date.
(iv) RESTRICTED STOCK. Participants holding restricted stock will recognize
ordinary income in the year in which the restrictions lapse, in the amount
of the fair market value of the shares as of the date of lapse of the
restrictions, unless the participant elects to include the fair market
value of the shares as of the date of grant in ordinary income at that
time.
(v) PERFORMANCE AWARDS. Ordinary income will be recognized by a participant
in the year in which it is received in an amount equal to the amount of the
Performance Award on the date of receipt.
Consequences to Synovus and Its Subsidiaries. In general, Synovus and its
subsidiaries will receive an income tax deduction at the same time and in
the same amount as the amount which is taxable to the employee as
compensation, except as provided below. To the extent a participant
realizes capital gains, as described above, Synovus and its subsidiaries
will not be entitled to any deduction for federal income tax purposes.
Under Section 162(m), compensation paid by a public company in excess of $1
million for any taxable year to ``Covered Employees'' generally is not
deductible by the company or its affiliates for federal income tax purposes
unless it is related to the performance of the company, is paid pursuant to
a plan approved by shareholders of the company and meets certain other
requirements.
Generally, ``Covered Employees'' is defined under Section 162(m) as any
individual who is the chief executive officer or is among the four other
highest paid executive officers named in the summary compensation table in
the company's proxy statement, other than the chief executive officer, as
of the last day of the taxable year. It is anticipated that future awards
will qualify as performance based for purposes of Section 162(m), except
for options subject to Adjustment Rights and restricted stock not subject
to preestablished performance goals. Synovus does not presently anticipate
making any such awards. However, Synovus and TSYS reserve the ability to
make awards which do not qualify for full deductibility under Section
162(m) if the Committee determines that the benefits of so doing outweigh
full deductibility.
New Plan Benefits. The following table shows grants of options and
restricted stock under the 1994 Plan for fiscal year 1994.
<PAGE>
<TABLE>
<CAPTION> Dollar
Number of Value of
Shares Subject to Restricted
Name/Position Options Granted <F1> Stock <F2>
<S> <C> <C>
Richard W. Ussery 13,827 $85,267
Chairman of the Board
and Chief Executive Officer
Kenneth E. Evans 9,129 56,296
Vice Chairman of the Board
Philip W. Tomlinson 9,783 60,329
President
William A. Pruett 3,912 24,124
Executive Vice President
James B. Lipham
Senior Vice President
and Chief Financial Officer -0- -0-
Executive Group <F3> 71,649 441,837
Nonexecutive Director
and Nominee Group <F4> 16,392 101,084
Nonexecutive Officer Employee
Group -0- -0-
<FN>
<F1>) Options have an exercise price equal to the fair market value of
Common Stock of Synovus on June 28, 1994, which was $17.25 per share. The
actual value an optionee may realize will depend on the excess of the stock
price over the exercise price on the date the option is exercised. The
price of the shares as of February 1, 1995 was $18.50. Options become
exercisable on June 28, 1996 and expire on June 27, 2002.
<F2> The amounts shown for the dollar value of restricted stock are derived
by multiplying the number of shares of restricted stock granted by the fair
market value of the Common Stock of Synovus on February 1, 1995.
<F3> Amounts include awards made to James H. Blanchard and G. Sanders
Griffith, III by Synovus in connection with their service as executive
officers of Synovus.
<F4> Amount includes award made to James D. Yancey by Synovus in connection
with his service as an executive officer of Synovus.
</TABLE>
Adoption of the proposal requires an affirmative vote by the holders of a
majority of the votes cast thereon. Any shares not voted (whether by
absention, broker non-vote, or otherwise) have no impact on the vote.
TSYS' BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS A VOTE ``FOR'' THE APPROVAL
OF THE SYNOVUS FINANCIAL CORP. 1994 LONG-TERM INCENTIVE PLAN.
IV. EXECUTIVE COMPENSATION
(1) Summary Compensation Table.
The following table summarizes the cash and noncash compensation for each
of the last three fiscal years for the chief executive officer of TSYS and
for the other four most highly compensated executive officers of TSYS.
<PAGE>
<TABLE>
SUMMARY COMPENSATION TABLE
<CAPTION> Long-Term
Annual Compensation Compensation Awards
Other Restricted Securities All
Annual Stock Underlying Other
Compen- Award(s) Options/ Compen-
Name/Position<F1> Year Salary<F2> Bonus <F3> sation <F4> <F5> SARs sation <F6>
<S> <C> <C> <C> <C> <C> <C> <C>
Richard W. Ussery 1994 $255,000 $162,105 -0- $ 79,505 13,827 $ 47,400
Chairman of the 1993 222,200 110,000 -0- -0- -0- 77,197
Board and Chief 1992 206,650 100,000 $266,992 492,804 -0- 56,158
Executive Officer
Kenneth E. Evans 1994 213,900 125,300 -0- 52,492 9,129 37,114
Vice Chairman 1993 195,950 96,875 51,932 -0- -0- 106,524
of the Board 1992 181,538 87,500 265,035 440,378 -0- 48,975
Philip W. Tomlinson 1994 221,350 129,830 -0- 56,252 9,783 42,602
President 1993 195,950 96,875 -0- -0- -0- 72,023
1992 183,125 87,500 238,589 440,378 -0- 50,456
William A. Pruett 1994 138,500 88,100 -0- 22,494 3,912 29,428
Executive Vice 1993 110,500 72,750 -0- -0- -0- 20,679
President 1992 100,150 25,125 80,976 149,462 -0- 23,337
James B. Lipham 1994 95,000 23,750 -0- -0- 2,400 22,774
Senior Vice President 1993 84,000 21,000 -0- -0- -0- 13,952
and Chief Financial 1992 77,000 19,250 64,781 119,569 -0- 18,188
Officer
<FN>
<F1> Messrs. Blanchard and Griffith received no cash compensation from TSYS
during 1994, other than, in the case of Mr. Blanchard, director fees.
<F2> Amount consists of base salary and director fees for Messrs. Ussery,
Evans and Tomlinson.
<F3> Bonus amount for 1994 includes special recognition awards of $5,000
each for Messrs. Ussery, Evans, Tomlinson and Pruett.
<F4> Perquisites and other personal benefits are excluded because the
aggregate amount does not exceed the lesser of $50,000 or 10% of annual
salary and bonus for the named executives.
<F5> Amount consists of value of award, net of consideration paid by the
executive. As of December 31, 1994, Messrs. Ussery, Evans, Tomlinson,
Pruett and Lipham held 91,953, 67,163, 84,105, 22,104 and 16,640 restricted
shares, respectively, with a value of $1,579,304, $1,153,209, $1,443,560,
$379,835 and $284,960, respectively. On June 28, 1994, restricted stock was
awarded in the amount of 4,609, 3,043, 3,261 and 1,304 shares of Synovus
Common Stock to Messrs. Ussery, Evans, Tomlinson and Pruett, respectively,
with the following vesting schedule: 20% on June 28, 1995; 20% on June 28,
1996; 20% on June 28, 1997; 20% on June 28, 1998 and 20% on June 28, 1999.
On February 21, 1992, restricted stock was awarded in the amount of 94,000,
84,000, and 84,000 shares of TSYS Common Stock to Messrs. Ussery, Evans and
Tomlinson, respectively, with the following vesting schedule: 20% on
February 20, 1993; 15% on February 20, 1994; 10% on February 20, 1995; 5%
on February 20, 1996; 10% on February 20, 1997; and 40% on February 20,
1998. On July 21, 1992, restricted stock was awarded in the amount of
32,000 and 25,600 shares of TSYS Common Stock to Messrs. Pruett and Lipham,
respectively, with the following vesting schedule: 20% on July 20, 1993;
15% on July 20, 1994; 10% on July 20, 1995; 15% on July 20, 1996; and 40%
on July 20, 1997. Dividends are paid on all restricted shares.
<F6> The 1994 amount consists of contributions to the Total System
Services, Inc. Profit Sharing Plan of
$22,500 for each executive; allocations pursuant to defined contribution
excess benefit agreements of $13,755, $7,583, $8,708 and $6,562 for each of
Messrs. Ussery, Evans, Tomlinson and Pruett, respectively; premiums paid
for group term life insurance coverage of $629, $551, $551, $366 and $274
for each of Messrs. Ussery, Evans, Tomlinson, Pruett and Lipham,
respectively; the economic benefit of life insurance coverage related to
split-dollar life insurance policies of $69, $40 and $75 for each of
Messrs. Ussery, Evans and Tomlinson, respectively; and the dollar value of
the benefit of premiums paid for split-dollar life insurance policies
(unrelated to term life insurance coverage) projected on an actuarial basis
of $10,447, $6,440 and $10,768 for each of Messrs. Ussery, Evans and
Tomlinson, respectively.
</TABLE>
(2) Stock Option Exercises and Grants.
The following tables provide certain information regarding stock options
granted and exercised in the last fiscal year and the number and value of
unexercised options at the end of the fiscal year.
<PAGE>
<TABLE>
OPTIONS/SAR GRANTS IN LAST FISCAL YEAR
<CAPTION> Individual Grants
% of Total Potential
Options/ Realized Value at
SARs Exercise Assumed Annual Rates of
Options/ Granted to or Market Stock Price Appreciation
SARs Employees Base Price For Option Term <F1>
Granted in Fiscal Price at Grant Expiration _____________________
Name (#) Year ($/Sh) ($/Share) Date 0%($) 5%($) 10% ($)
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Richard W. Ussery 13,827<F2> 3.2% $17.25 $17.25 06/27/02 N/A $113,934 $272,945
Kenneth E. Evans 9,129<F2> 2.1% 17.25 17.25 06/27/02 N/A 75,223 180,206
Philip W. Tomlinson 9,783<F2> 2.3% 17.25 17.25 06/27/02 N/A 80,612 193,116
William A. Pruett 3,912<F2> 0.9% 17.25 17.25 06/27/02 N/A 32,235 77,223
James B. Lipham 2,400<F3> 1.2% 6.00 10.75 06/27/02 $11,400 23,712 40,896
<FN>
<F1> The dollar gains under these columns result from calculations using
the identified growth rates and are not intended to forecast future price
appreciation of Synovus Common Stock.
<F2> Options granted June 28, 1994 on Synovus Common Stock at fair market
value to executives in tandem with restricted stock awards as part of the
Synovus 1994 Long-Term Incentive Plan. Options become exercisable on June
28, 1996.
<F3> Options granted June 28, 1994 on TSYS Common Stock as part of the 1992
Total System Services, Inc. Long-Term Incentive Plan, which options become
exercisable on June 28, 1997.
</TABLE>
<PAGE>
<TABLE>
AGGREGATED OPTION/SAR EXERCISES IN LAST FISCAL YEAR
AND FY-END OPTION/SAR VALUES
<CAPTION> Number of Securities Value of
Shares Value Underlying Unexercised Unexercised In-the-Money
Acquired on Realized Options/SARs at FY-End (#) Options/SARs at FY-End ($)<F1>
Name Exercise (#) ($)<F1> Exercisable/Unexercisable Exercisable/Unexercisable
<C> <C> <C> <C> <C>
Richard W. Ussery -0- -0- 0/13,827 0/$12,099
Kenneth E. Evans -0- -0- 0/ 9,129 0/$ 7,988
Philip W. Tomlinson -0- -0- 0/ 9,783 0/$ 8,560
William A. Pruett -0- -0- 0/ 3,912 0/$ 3,423
James B. Lipham -0- -0- 0/ 2,400 0/$26,700
<FN>
<F1> Market value of underlying securities at exercise or year-end, minus
the exercise or base price.
</TABLE>
(3) Pension Plan.
The following table shows the estimated benefit payable upon retirement
under the Total System Services, Inc. Pension Plan (``Pension Plan'') for
the specified compensation and years of service classifications. Prior to
January 1, 1993, employees of TSYS accrued benefits under Synovus' Pension
Plan, the terms of which are the same as the Pension Plan.
<PAGE>
<TABLE>
<CAPTION> PENSION PLAN TABLE
Years of Service
Remuneration 15 20 25 30 35
<S> <C> <C> <C> <C> <C>
$125,000 27,808 37,077 46,346 55,615 55,615
$150,000 34,058 45,410 56,763 68,115 68,115
$175,000 40,308 53,743 67,179 80,615 80,615
$200,000 46,558 62,077 77,596 93,115 93,115
$225,000 52,058 70,410 88,013 105,615 105,615
$250,000 59,058 78,743 98,429 118,115 118,115
$300,000 71,558 95,410 118,800 118,800 118,800
$400,000 96,558 118,800 118,800 118,800 118,800
$450,000 109,058 118,800 118,800 118,800 118,800
$500,000 118,800 118,800 118,800 118,800 118,800
</TABLE>
Benefits under the Pension Plan are computed on the basis of a straight
life annuity and are subject to an offset for Social Security benefits. The
above table assumes continuation of full-time employment to age 65 and uses
projected levels of Social Security benefits under present law. The
compensation covered by the Pension Plan is based upon a Participant's W-2
income (which includes the taxable items of compensation reported in the
Summary Compensation Table that were paid in the applicable year) using the
average of the highest consecutive 10 years of compensation. Pursuant to
federal income tax laws, however, compensation under the Pension Plan is
limited to $200,000 for 1989, $209,200 for 1990, $222,220 for 1991,
$228,860 for 1992, $235,840 for 1993 and $150,000 for 1994. There is no cap
on earnings for years prior to 1989. The covered compensation under the
Pension Plan for each executive officer for 1994 is $150,000, except for
Mr. Lipham, whose covered compensation under the Pension Plan for 1994 is
$116,000. The estimated credited years of service under the Pension Plan
for Messrs. Ussery, Tomlinson, Evans, Pruett and Lipham are 29, 20, 21, 17
and 10, respectively.
(4) Compensation of Directors.
Compensation. During 1994, TSYS' directors received a $10,500 retainer, a
fee of $400 for regular and special meetings of TSYS' Board of Directors
they personally attended and a fee of $100 for meetings of the committees
of TSYS' Board of Directors they personally attended. In addition,
directors of TSYS are entitled to receive a $400 fee for one regular
meeting and a fee of $400 for one special meeting of TSYS' Board of
Directors, despite the fact they are unable to personally attend such
meetings.
Director Stock Purchase Plan. TSYS' Director Stock Purchase Plan (``DSPP'')
is a non-tax-qualified, contributory stock purchase plan pursuant to which
qualifying TSYS directors can purchase, with the assistance of
contributions from TSYS, presently issued and outstanding shares of TSYS
Common Stock. Under the terms of the DSPP, qualifying directors can elect
to contribute up to $1,000 per calendar quarter to make purchases of TSYS
Common Stock, and TSYS contributes an additional amount equal to 50% of the
directors' cash contributions. Participants in the DSPP are fully vested
in, and may request the issuance to them of, all shares of TSYS Common
Stock purchased for their benefit thereunder.
(5) Change in Control Arrangements.
Messrs. Ussery, Evans, Tomlinson, Pruett and Lipham each hold shares of
restricted stock of, and options to purchase stock of, Synovus and/or TSYS
which were issued pursuant to the 1992 Total System Services, Inc.
Long-Term Incentive Plan and the Synovus Financial Corp. 1994 Long-Term
Incentive Plan. Under the terms of the 1992 Total System Services, Inc.
Long-Term Incentive Plan and the Synovus Financial Corp. 1994 Long-Term
Incentive Plan, in the event of a change in control of TSYS or Synovus, the
vesting of any stock options, stock appreciation and other similar rights,
restricted stock and performance awards will be accelerated so that all
awards not previously exercisable and vested will become fully exercisable
and vested.
Notwithstanding anything to the contrary set forth in any of TSYS' previous
filings under the Securities Act of 1933, as amended, or the Exchange Act
that might incorporate future filings, including this Proxy Statement, in
whole or in part, the following Performance Graph and Compensation
Committee Report on Executive Compensation shall not be incorporated by
reference into any such filings.
(6) Stock Performance Graph.
The following graph compares the yearly percentage change in cumulative
shareholder return on TSYS Common Stock with the cumulative total return of
the Standard & Poor's 500 Index and the Standard & Poor's Computer Software
& Services Index for the last five fiscal years (assuming a $100 investment
on December 31, 1989 and reinvestment of all dividends).
[Omitted Stock Performance Graph is represented by the following table.]
<PAGE>
<TABLE>
COMPARISON OF FIVE YEAR CUMULATIVE TOTAL RETURN AMONG
TSYS, S&P 500 AND S&P COMPUTER SOFTWARE & SERVICES INDEX
<CAPTION>
1989 1990 1991 1992 1993 1994
<S> <C> <C> <C> <C> <C> <C>
TSYS $100 $121 $ 96 $110 $201 $264
S&P 500 $100 $ 97 $126 $136 $150 $152
S&P CS&S $100 $ 78 $119 $141 $180 $213
</TABLE>
(7) Compensation Committee Report on Executive Compensation.
The Compensation Committee (the ``Committee'') of the Board of Directors of
TSYS is responsible for evaluating the remuneration of senior management
and board members of TSYS and its subsidiaries and the compensation and
fringe benefit plans in which officers, employees and directors of TSYS are
eligible to participate. Because TSYS' mission is to exceed the
expectations of its customers through the delivery of superior service and
continuous quality improvement that rewards its employees and enhances the
value of its shareholders' investments, the Committee's executive
compensation policies and practices are designed to attract, retain and
reward its executives for their performance in accomplishing TSYS' mission.
Elements of Executive Compensation. The four elements of executive
compensation are:
Base Salary
Annual Bonus
Long-Term Incentives
Benefits
The Committee believes that a substantial portion, though not a majority,
of an executive's compensation should be ``at-risk'' based upon TSYS'
short-term performance (through the annual bonus and TSYS' Profit Sharing
Plan) and long-term performance (through long-term incentives, including
stock options and restricted stock awards). The remainder of each
executive's compensation is based upon the competitive practices of
companies in the same business and similar in size to TSYS (``similar
companies'') as described below. The companies used for comparison are not
the same companies used in the peer group index appearing in the Stock
Performance Graph above. A description of each element of executive
compensation and the factors and criteria used by the Committee in
determining these elements is discussed below:
Base Salary. Base salary is an executive's annual rate of pay without
regard to any other elements of compensation. The primary consideration in
determining an executive's base salary is a market comparison of the base
salaries at similar companies for similar positions based upon the
executive's level of responsibility and experience. Base salaries are
targeted at the median levels of the similar companies used in the
comparison. In addition to market comparisons, corporate performance
(measured by shareholder return and earnings) and individual performance
(measured by the quality of TSYS' strategic plan, the executive's
management responsibilities and development, and the executive's industry
and civic involvement) are also considered in determining an executive's
base salary, although these factors do not weigh heavily in determining
base salary. Based solely upon market comparisons, the Committee increased
Mr. Ussery's base salary in 1994. The Committee also increased the base
salaries of TSYS' other executive officers in 1994 based solely upon market
comparisons.
Annual Bonus. Annual bonuses are awarded pursuant to the terms of the
Synovus Financial Corp. Incentive Bonus Plan. The Committee reviews and
approves all bonuses awarded to TSYS executives although, in accordance
with the terms of the Incentive Bonus Plan, bonuses are initially awarded
by the Compensation Committee of Synovus. Under the Incentive Bonus Plan,
bonus amounts are paid as a percentage of base pay based on financial
performance goals such as revenues and net income. The maximum percentage
payouts, established by the Committee, under the Incentive Bonus Plan are
65% for Mr. Ussery, 60% for Messrs. Tomlinson and Evans, 50% for Mr. Pruett
and 25% for Mr. Lipham. For Mr. Ussery and TSYS' other executive officers,
the 1994 goal under the Incentive Bonus Plan was a single net income goal
for TSYS. TSYS' financial performance and individual performance, separate
from the financial performance goals established at the beginning of the
year, can reduce bonus awards determined by the attainment of the
established goals, although this was not the case for any of TSYS'
executive officers. Because the net income goal for 1994 under the
Incentive Bonus Plan was exceeded, Mr. Ussery and TSYS' other executive
officers were awarded the maximum bonus amount for which each executive was
eligible.
Long-Term Incentives. The two types of long-term incentives awarded to
executives to date are stock options and restricted stock awards. Because
of the relatively low number of previously traded shares of TSYS, the
Committee decided that TSYS executives should be eligible to receive stock
options and restricted stock awards of Synovus stock under the Synovus
Financial Corp. 1994 Long-Term Incentive Plan, thereby linking their
interests to the interests of TSYS and Synovus shareholders. The Committee
reviews and approves all long-term incentive awards to TSYS executives
although, in accordance with the terms of the Synovus 1994 Long-Term
Incentive Plan, long-term incentives are actually awarded by the
Compensation Committee of Synovus. Restricted stock awards are designed to
focus executives on the long-term performance of TSYS and Synovus. Stock
options provide executives with the opportunity to buy and maintain an
equity interest in TSYS and Synovus and to share in the appreciation of the
value of TSYS and Synovus Common Stock. During 1994, the Committee
restructured its approach for granting long-term incentive awards. The
Committee previously had no formal policy regarding the frequency of
long-term incentive awards. In 1994, the Committee decided to make annual
long-term incentive award grants based upon company performance over a
three-year period. For 1994, to transition into this new approach, the
Committee granted stock options and restricted stock awards based upon
market comparisons of the long-term incentives granted to executives at
similar companies with similar levels of responsibility and experience. The
Committee targeted the median level of long-term incentive awards of
similar companies using equal grants of restricted stock awards and stock
options based upon the projected value of such awards.
Based solely upon these market comparisons, the Committee granted Mr.
Ussery and TSYS' other executive officers restricted stock awards and stock
options in 1994. Beginning in 1995, the Committee anticipates making annual
grants of long-term incentive awards based upon company performance
measured by total shareholder return over the previous three-year period.
The Committee established a payout matrix in 1994 for future long-term
incentive grants that uses total shareholder return as measured by Synovus'
performance (stock price increases plus dividends) and how Synovus' total
shareholder return compares to the return of a peer group of companies.
Benefits. Benefits offered to executives serve a different purpose than the
other elements of total compensation. In general, these benefits provide
either retirement income or protection against catastrophic events such as
illness, disability and death. Executives generally receive the same
benefits offered to the general employee population, with the only
exceptions designed to promote tax efficiency or to replace other benefits
lost due to regulatory limits or insurance carrier policy limits. TSYS'
Profit Sharing Plan, including an excess benefit arrangement designed to
replace Profit Sharing Plan benefits lost due to regulatory limits
(collectively the ``Plan''), is the largest component of TSYS' benefits
package for executives. The Plan is directly related to corporate
performance because the amount of contributions to the Profit Sharing Plan
(to a maximum of 15% of an executive's compensation) is a function of TSYS'
profitability. For 1994, Mr. Ussery and TSYS' other executive officers
received the maximum Plan contribution, which is equal to 15% of their
compensation, because the profitability formula under the Plan was
exceeded. The remaining benefits provided to executives are primarily based
upon the competitive practices of similar companies.
In 1993, the Internal Revenue Code of 1986, as amended, was amended to
limit the deductibility for federal income tax purposes of annual
compensation paid by a publicly held corporation to its chief executive
officer and four other highest paid executives for amounts greater than $1
million unless certain conditions are met. Although none of TSYS' executive
officers are currently affected by this provision, the Committee believes
that this provision could affect TSYS' executive officers in the future.
Because the Committee seeks to maximize shareholder value, the Committee
has taken steps to ensure the deductibility of compensation in excess of $1
million in the future. See Section III hereof captioned ``DIRECTORS'
PROPOSAL TO APPROVE THE SYNOVUS FINANCIAL CORP. 1994 LONG-TERM INCENTIVE
PLAN''.
The Committee believes that the executive compensation policies serve the
best interests of the shareholders and of TSYS. A substantial portion of
the compensation of TSYS' executives is directly related to and
commensurate with TSYS' performance. The Committee believes that the
performance of TSYS to date validates the Committee's compensation
philosophy.
William B. Turner
Gardiner W. Garrard, Jr.
George C. Woodruff, Jr.
(8) Compensation Committee Interlocks and Insider Participation.
The members of TSYS' Compensation Committee are William B. Turner, Gardiner
W. Garrard, Jr. and George C. Woodruff, Jr. No member of the Committee is a
current or former officer or employee of TSYS or its subsidiaries.
Mr. Turner is Chairman of the Executive Committee of W.C. Bradley Co. James
H. Blanchard, Chairman of the Executive Committee of TSYS, serves on the
Board of Directors of W.C. Bradley Co. TSYS leases various properties in
Columbus, Georgia from W.C. Bradley Co. for office space and storage. The
rent paid for the space in 1994, which is approximately 99,378 square feet,
is approximately $680,966. The lease agreements were made substantially on
the same terms as those prevailing at the time for comparable leases for
similar facilities with an unrelated third party in Columbus, Georgia.
TSYS has entered into an agreement with CB&T with respect to the use of
aircraft owned or leased by B&C Company, a Georgia general partnership in
which CB&T and W.C. Bradley Co. are equal partners. CB&T and W.C. Bradley
Co. have each agreed to remit to B&C Company fixed fees for each hour they
fly the aircraft owned and/or leased by B&C Company. TSYS paid CB&T
$368,768 for its use of the B&C Company aircraft during 1994, which
$368,768 was remitted to B&C Company by CB&T. The charges payable by TSYS
to CB&T in connection with its use of this aircraft approximate charges
made available to unrelated third parties in the State of Georgia for use of
comparable aircraft for commercial purposes. William B. Turner, a director
of TSYS, Chairman of the Board of CB&T and Chairman of the Executive
Committee of Synovus, is an officer, director and shareholder of W.C. Bradley
Co. James H. Blanchard, Chairman of the Executive Committee of TSYS, Chairman
of the Board of Synovus and a director of CB&T, is a director of W.C. Bradley
Co. W. Walter Miller, Jr., a director and shareholder of W.C. Bradley Co.,
is Senior Vice President and a director of TSYS. Elizabeth C. Ogie, the
niece of William B. Turner and the sister-in-law of W. Walter Miller, Jr.,
is a director and shareholder of W.C Bradley Co. and a director of CB&T
and Synovus. Stephen T. Butler, the nephew of William B. Turner and an
officer, director and shareholder of W.C. Bradley Co., is a director of CB&T.
Samuel M. Wellborn, III, President and a director of CB&T, is a director of
W.C. Bradley Co. W.B. Turner, Jr. and John T. Turner, the sons of William
B. Turner, are officers, directors and shareholders of W.C. Bradley Co.
and are also directors of CB&T.
Gardiner W. Garrard, Jr. is President of The Jordan Company. On October 1,
1993, TSYS entered into a lease with The Jordan Company pursuant to which
TSYS leases from The Jordan Company approximately 10,000 square feet of
office space in Columbus, Georgia for $5,000 per month, payable in advance,
which lease expires on September 30, 1996. The lease was made on
substantially the same terms as those prevailing at the time for leases of
comparable property between unrelated third parties. Gardiner W. Garrard,
Jr., a director of TSYS, CB&T and Synovus, is an officer, director and
shareholder of The Jordan Company. Richard M. Olnick, the brother-in-law of
Gardiner W. Garrard, Jr. and a director of CB&T, is an officer, director
and shareholder of The Jordan Company.
(9) Transactions with Management.
During 1994, TSYS paid to Communicorp, Inc. an aggregate of $561,113. These
payments were made in the ordinary course of business on substantially the
same terms as those prevailing at the time for comparable transactions with
unrelated third parties, and were primarily for various printing and
business communication services provided by Communicorp, Inc. to TSYS.
Communicorp, Inc. is a wholly-owned subsidiary of AFLAC Incorporated.
Daniel P. Amos, a director of CB&T and Synovus, is Chief Executive Officer
and a director of AFLAC Incorporated.
King & Spalding, a law firm located in Atlanta, Georgia, performed legal
services on behalf of TSYS during 1994. Griffin B. Bell, a director of
TSYS, is a Senior Partner of King & Spalding.
For information about transactions with companies that are affiliates of
William B. Turner and Gardiner W. Garrard, Jr., directors of TSYS, see
Section IV(8) captioned ``Compensation Committee Interlocks and Insider
Participation.''
For a description of certain transactions between TSYS and its affiliated
companies, upon whose Boards of Directors certain of TSYS' directors also
serve, see Section V(D) hereof captioned ``Bankcard Data Processing
Services Provided to CB&T, Certain of Synovus' Subsidiaries and Other
Parties; Other Agreements Between TSYS, Synovus, CB&T and Certain of
Synovus' Subsidiaries.''
V. RELATIONSHIPS BETWEEN TSYS, SYNOVUS, CB&T AND CERTAIN OF SYNOVUS'
SUBSIDIARIES
A. Beneficial Ownership of TSYS Common Stock by CB&T.
The following table sets forth, as of December 31, 1994, the number of
shares of TSYS Common Stock beneficially owned by CB&T, the only known
beneficial owner of more than 5% of the issued and outstanding shares of
TSYS Common Stock.
<PAGE>
<TABLE>
Percentage of
<CAPTION> Shares of Outstanding Shares of
TSYS Common Stock TSYS Common Stock
Name and Address Beneficially Owned Beneficially Owned
Beneficial Owner as of 12/31/94 as of 12/31/94
<S> <C> <C>
Columbus Bank
and Trust Company 52,200,646 <F1>(f2> 80.8%
1148 Broadway,
Columbus, Georgia 31901
<FN>
<F1> CB&T individually owns these shares.
<F2> As of December 31, 1994, certain banking subsidiaries of Synovus,
including CB&T, held in various fiduciary capacities a total of 355,940
shares (.55%) of TSYS Common Stock. Of this total, CB&T held 316,912 shares
as to which it possessed sole voting or investment power and 30,428 shares
as to which it possessed shared voting and investment power. The other
banking subsidiaries of Synovus held 5,700 shares as to which they
possessed sole voting and investment power and 2,900 shares as to which
they possessed shared voting and investment power. In addition, as of
December 31, 1994, CB&T and the other banking subsidiaries of Synovus held
in various agency capacities an additional 432,406 shares of TSYS Common
Stock as to which they possessed no voting or investment power. Of this
additional amount as to which no voting or investment power was possessed,
CB&T and the other banking subsidiaries of Synovus held 380,512 and 51,894
shares, respectively. Synovus and its banking subsidiaries disclaim
beneficial ownership of all shares of TSYS Common Stock which are held by
them in various fiduciary and agency capacities.
</TABLE>
CB&T, by virtue of its individual ownership of 52,200,646 shares, or 80.8%,
of the outstanding shares of TSYS Common Stock on December 31, 1994 is able
to, and intends to, elect a majority of TSYS' Board of Directors. CB&T
presently controls TSYS.
B. Interlocking Directorates of TSYS, Synovus and CB&T.
Eight of the sixteen members of and nominees to serve on TSYS' Board of
Directors also serve as members of the Boards of Directors of Synovus and
CB&T. They are James H. Blanchard, Richard Y. Bradley, Salvador
Diaz-Verson, Jr., Gardiner W. Garrard, Jr., H. Lynn Page, William B.
Turner, George C. Woodruff, Jr., and James D. Yancey. John P. Illges, III
serves as an Advisory Director of Synovus and as a director of CB&T and
Mason H. Lampton serves as an Advisory Director of CB&T and as a director
of Synovus.
C. Synovus Common Stock Ownership of Directors, Nominees and Management.
The following table sets forth, as of January 31, 1995, the number of
shares of Synovus Common Stock beneficially owned by TSYS' named executive
officers, directors and nominees for election as Class III directors.
<PAGE>
<TABLE>
<CAPTION>
Shares of Shares of Shares of
Synovus Synovus Synovus Percentage
Common Stock Common Stock Common Stock of
Beneficially Beneficially Beneficially Total Outstanding
Owned with Owned with Owned with Shares of Shares of
Sole Voting Shared Sole Voting Synovus Synovus
and Voting and but no Common Stock Common Stock
Investment Investment Investment Beneficially Beneficially
Power as of Power as of Power as of Owned as of Owned as of
Name 1/31/95 1/31/95 1/31/95 1/31/95 1/31/95
<S> <C> <C> <C> <C> c>
Griffin B. Bell 2,240 5,500 ----- 7,740 0.01%
James H. Blanchard 526,611 3,835 8,478 538,924 0.80
Richard Y. Bradley 4,269 37,481 ----- 41,750 0.06
Salvador Diaz-Verson, Jr. 17,443 ----- ----- 17,443 0.03
Kenneth E. Evans 11,795 278 3,043 15,116 0.02
Gardiner W. Garrard, Jr. 54,355 446,513 ----- 500,868 0.74
John P. Illges, III 179,389 77,630 ----- 257,019 0.38
Mason H. Lampton 118,884 68,465 ----- 187,309 0.28
James B. Lipham 693 ----- ----- 693 .001
William M. McVay 36,372 ----- ----- 36,372 0.05
W. Walter Miller, Jr. 11,943<F1> 19,088 ----- 31,031 0.05
H. Lynn Page 283,959 3,412 ----- 287,371 0.42
William A. Pruett ----- ----- 1,304 1,304 .002
Philip W. Tomlinson 94 ----- 3,261 3,355 .005
William B. Turner 27,560 5,057,996 ----- 5,085,556 7.52
Richard W. Ussery 6,750 1,314 4,609 12,673 0.02
George C. Woodruff, Jr. 35,915 ----- ----- 35,915 0.05
James D. Yancey 306,391 13,275 5,464 325,130 0.48
<FN>
<F1> Includes 3,000 shares of Synovus Common Stock with respect to which
W. Walter Miller, Jr. has options to acquire.
</TABLE>
The following table sets forth information, as of January 31, 1995, with
respect to the beneficial ownership of Synovus Common Stock by all
directors, nominees and executive officers of TSYS as a group.
<PAGE>
<TABLE>
Percentage of
<CAPTION> Shares of Outstanding Shares of
Synovus Common Stock Synovus Common Stock
Name of Beneficially Owned Beneficially Owned
Beneficial Owner as of 1/31/95 as of 1/31/95
<S> <C> <C>
All directors,
nominees and executive
officers of TSYS as a
group 7,445,335 10.99%
(includes 19 persons)
</TABLE>
D. Bankcard Data Processing Services Provided to CB&T, Certain of Synovus'
Subsidiaries and Other Parties; Other Agreements Between TSYS, Synovus,
CB&T and Certain of Synovus' Subsidiaries.
During 1994, TSYS provided bankcard data processing services to CB&T and 31
of Synovus' other banking subsidiaries. During 1994, TSYS also provided to
AT&T Universal Card Services Corp. (``UCS'') the bankcard data processing
services that UCS has agreed with Universal Bank, which was a subsidiary of
Synovus during 1994, to provide in connection with the AT&T Universal Card
issued by Universal Bank. The bankcard data processing agreement between
TSYS and CB&T can be terminated by CB&T upon 60 days prior written notice
to TSYS or terminated by TSYS upon 180 days prior written notice to CB&T.
During 1994, TSYS charged CB&T and 31 of Synovus' other banking
subsidiaries $2,321,517, in the aggregate, including the reimbursement of
out of pocket expenses, for the performance of bankcard data processing
services. TSYS charged UCS for all of the bankcard data processing services
provided with respect to the Universal Card. TSYS' charges to CB&T and
Synovus' other banking subsidiaries for bankcard data processing services
are comparable to, and are determined on the same basis as, charges by TSYS
to similarly situated unrelated third parties. TSYS' charges to UCS for
bankcard data processing services were negotiated with UCS on an
arm's-length basis and are comparable to charges by TSYS to other similarly
situated unrelated third parties.
TSYS and Synovus are parties to Management Agreements (having one year,
automatically renewable, unless terminated, terms), pursuant to which
Synovus provides certain management services to TSYS. During 1994, these
services included miscellaneous personnel services, investor relations
services, corporate governance services, legal services, regulatory and
statutory compliance services, executive management services performed on
behalf of TSYS by certain of Synovus' officers and financial services. As
compensation for management services provided during 1994, TSYS paid
Synovus a management fee of $915,215. As compensation for payroll
processing support services provided by TSYS to Synovus during 1994,
Synovus paid TSYS a management fee of $409,438. Management fees are subject
to future adjustments based upon the management services then being
provided based upon charges at the time by unrelated third parties for
comparable services.
During 1994, CB&T served as Trustee of TSYS' Pension Plan, TSYS' Profit
Sharing Plan and TSYS' Medical Benefits Plan. During 1994, TSYS paid CB&T
trustee's fees under TSYS' Pension Plan, TSYS' Profit Sharing Plan and
TSYS' Medical Benefits Plan of $33,308, $133,821 and $1,200, respectively.
During 1994, Columbus Depot Equipment Company (``CDEC''), a wholly-owned
subsidiary of TSYS, and CB&T and 21 of Synovus' other subsidiaries were
parties to Lease Agreements pursuant to which CB&T and 21 of Synovus' other
subsidiaries leased from CDEC computer related equipment for bankcard and
bank data processing services for lease payments aggregating $145,088.
During 1994, CDEC sold CB&T and certain of Synovus' other subsidiaries
computer related equipment for bankcard and bank data processing services
for payments aggregating $257,364. In addition, CDEC was paid $26,563 by
CB&T and certain of Synovus' other subsidiaries for monitoring such
equipment and $3,280 for servicing various computer related equipment. The
terms, conditions, rental rates and/or sales prices provided for in these
Agreements are comparable to corresponding terms, conditions and rates
provided for in leases and sales of similar equipment offered by unrelated
third parties.
During 1994, Synovus Data Corp., a subsidiary of Synovus, paid TSYS
$732,136 for data links, network services and other miscellaneous items
related to the data processing services which Synovus Data Corp. provides
to its customers, which amount was reimbursed to Synovus Data Corp. by its
customers, and $193,632 for management services. During 1994, TSYS paid
Synovus Data Corp. $96,000, primarily for computer processing services. The
charges for processing and other services are comparable to those between
unrelated third parties.
During 1994, TSYS and Synovus Data Corp. were parties to a Lease Agreement
pursuant to which TSYS leased from Synovus Data Corp. portions of its
office building for lease payments aggregating $214,650. During 1994, TSYS
and CB&T were parties to a Lease Agreement pursuant to which CB&T leased
from TSYS portions of its maintenance facility for lease payments
aggregating $19,088. In August, 1993, TSYS entered into a three-year Lease
Agreement with CB&T pursuant to which it leases office space from CB&T for
lease payments of $4,483 per month. The terms, conditions and rental rates
provided for in these Lease Agreements are comparable to corresponding
terms, conditions and rates provided for in leases of similar facilities
offered by unrelated third parties in the Columbus, Georgia area.
During 1994, Synovus, CB&T and other Synovus subsidiaries paid to Columbus
Productions, Inc., a subsidiary of TSYS, an aggregate of $439,402 for
printing services. The charges for printing services are comparable to
those between unrelated third parties.
During 1994, TSYS purchased 12,217 shares of Synovus Common Stock from
Synovus for $210,743 and simultaneously granted the shares to certain
executive officers of TSYS as restricted stock awards. The per share
purchase price of such shares was equal to the fair market value of a share
of Synovus Common Stock on the date of purchase.
Most customers of the services marketed as THE TOTAL SYSTEM (SM) maintain
special clearing demand deposit accounts with CB&T to facilitate the
settlement of bankcard transactions between VISA(R), MASTERCARD(R), TSYS and
the customers. In certain cases, with the approval of CB&T, these special
clearing accounts may also be utilized by customers for other correspondent
banking transactions with CB&T.
TSYS and its subsidiaries maintain one or more demand deposit accounts with
CB&T. Demand deposit balances with CB&T were $2,302,765 at December 31,
1994. During 1994, CB&T paid TSYS and its subsidiaries $384,070 of interest
on interest bearing deposits TSYS and its subsidiaries maintain with CB&T.
In addition, CB&T served as TSYS' stock transfer agent and agent of TSYS'
Employee and Director Stock Purchase Plans during 1994 for which it
received fees of $35,596. During 1994, TSYS and its subsidiaries paid CB&T
$2,912 of interest in connection with a loan from CB&T. These interest
rates and fees are comparable to those provided for between unrelated third
parties.
Effective December 28, 1990, TSYS, the Development Authority of Columbus,
Georgia, and CB&T, as Trustee, consummated the issuance of, and various
banking subsidiaries of Synovus purchased, $15,000,000 of industrial
development revenue bonds, the proceeds of which were used by TSYS to
acquire and construct its 210,000 square foot North Center production
facility. As a result of the consummation of such financing, TSYS will
lease its North Center facility from the Development Authority for a period
of 30 years, with the lease payments to be paid thereon being used by the
Authority to satisfy its obligations to the purchasers of the bonds. The
terms of such bonds, including the 9.75% rate of interest to be paid
thereon and the schedule upon which principal will be repaid included
therein, and the various other documents pursuant to which such bonds were
issued, were arrived at as a result of arm's-length negotiations between
TSYS, the Authority, the Trustee and the various subsidiary banks of
Synovus which purchased the bonds, and are no less favorable than could be
obtained from unrelated third parties. During 1994, TSYS made principal
payments of $900,000 and interest payments of $57,281 in connection with
such bonds.
The Board of Directors of TSYS has resolved that transactions with
officers, directors, key employees and their affiliates shall be approved
by a majority of its independent and disinterested directors, if otherwise
permitted by applicable law, and will be on terms no less favorable than
could be obtained from unrelated third parties.
VI. COMPLIANCE WITH SECTION 16(a) OF THE SECURITIES EXCHANGE ACT
Section 16(a) of the Exchange Act requires TSYS' officers and directors,
and persons who own more than ten percent of TSYS Common Stock, to file
reports of ownership and changes in ownership with the SEC and the New York
Stock Exchange. Officers, directors and greater than ten percent
shareholders are required by SEC regulation to furnish TSYS with copies of
all Section 16(a) forms they file.
To TSYS' knowledge, based solely on its review of the copies of such forms
received by it, and written representations from certain reporting persons
that no Forms 5 were required for those persons, TSYS believes that during
fiscal year ended December 31, 1993, all Section 16(a) filing requirements
applicable to its officers, directors, and greater than ten percent
beneficial owners were complied with, except that Mr. Miller reported late
on an amended Form 4 one purchase of 40 shares of TSYS Common Stock for his
minor child's account; Mr. Bradley reported late on an amended Form 4 one
purchase of 300 shares of TSYS Common Stock; Raymond M. Wright, who was a
director of TSYS during 1994 and is now an Emeritus Director of TSYS,
reported late on two amended Forms 4 four purchases aggregating 575 shares
of TSYS Common Stock; and Mr. McVay reported late on a corrective Form 5
one purchase of 92 shares in the TSYS Director Stock Purchase Plan.
VII. INDEPENDENT AUDITORS
On February 6, 1995, TSYS' Board of Directors appointed KPMG Peat Marwick
LLP as the independent auditors to audit the financial statements of TSYS
and its subsidiaries for the fiscal year ending December 31, 1995. The
Board of Directors knows of no direct or material indirect financial
interest by KPMG Peat Marwick LLP in TSYS or of any connection between KPMG
Peat Marwick LLP and TSYS in the capacity of promoter, underwriter, voting
trustee, director, officer, shareholder or employee.
Representatives of KPMG Peat Marwick LLP will be present at TSYS' 1995
Annual Meeting with the opportunity to make a statement if they desire to
do so and will be available to respond to appropriate questions.
VIII. FINANCIAL INFORMATION WITH REFERENCE TO TSYS CONTAINED IN TSYS' 1994
ANNUAL REPORT
Detailed financial information for TSYS and its subsidiaries for its 1994
fiscal year is included in TSYS' 1994 Annual Report that is being mailed to
TSYS' shareholders together with this Proxy Statement.
IX. OTHER MATTERS
At the time of preparation of this Proxy Statement, TSYS' Board of
Directors has not been informed of any matters to be presented by or on
behalf of TSYS' Board of Directors or its management for action at TSYS'
1995 Annual Meeting which are not referred to herein. If any other matters
come before the Annual Meeting or any adjournment thereof, it is the
intention of the persons named in the accompanying Proxy to vote thereon in
accordance with their best judgment.
TSYS' shareholders are urged to vote, date and sign the enclosed Proxy Card
solicited on behalf of TSYS' Board of Directors and return it at once in
the envelope enclosed herewith for that purpose. This should be done
whether or not the TSYS shareholder plans to attend TSYS' 1995 Annual
Meeting.
By Order of the Board of Directors
/s/ Richard W. Ussery
Richard W. Ussery
Chairman of the Board, Total System Services, Inc.
Columbus, Georgia
March 10, 1995<PAGE>
APPENDIX A
PROXY PROXY
TOTAL SYSTEM SERVICES, INC.
POST OFFICE BOX 2506, COLUMBUS, GEORGIA 31902-2506
ANNUAL MEETING OF SHAREHOLDERS OF TSYS TO BE HELD APRIL 10, 1995
SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS OF TSYS
The undersigned shareholder of Total System Services, Inc. ("TSYS"),
Columbus, Georgia, hereby makes, constitutes and appoints James B. Lipham
and Dorenda K. Weaver, or any of them acting singly in the absence of the
other, the true and lawful attorney(s) and proxy(ies) of the undersigned,
each of them with full power of substitution, for and in the name, place
and stead of the undersigned to represent and to vote all shares of the
$.10 par value common stock of TSYS ("TSYS Common Stock") standing in the
name of the undersigned or with respect to which the undersigned is
entitled to vote at the ANNUAL MEETING OF THE SHAREHOLDERS OF TSYS to be
held on the 10th day of April 1995, and at any adjournments or
postponements thereof, with all the powers the undersigned would possess if
personally present.
The Board of Directors is not aware of any matters likely to be presented
for action at the Annual Meeting of Shareholders of TSYS, other than the
matters listed herein. However, if any other matters are properly brought
before the Annual Meeting, the persons named in this Proxy or their
substitutes will vote upon such other matters in accordance with their best
judgement. This Proxy is revocable at any time prior to its use.
THIS PROXY WHEN PROPERLY EXECUTED WILL BE VOTED IN ACCORDANCE WITH ANY
INSTRUCTIONS INDICATED HEREIN. IF NO INDICATION IS MADE, IT WILL BE VOTED
IN FAVOR OF EACH OF THE PROPOSALS LISTED HEREIN.
PLEASE VOTE AND SIGN ON OTHER SIDE AND RETURN PROMPTLY IN ENCLOSED
ENVELOPE.
Please sign exactly as your name appears on this Proxy. When shares are
held by joint tenants, both must sign. When signing in a fiduciary or
representative capacity, give you full title as such. If a corporation,
please sign in full corporate name by an authorized officer. If a
partnership, please sign in full partnership name by an authorized person.
HAS YOUR ADDRESS CHANGED?
DO YOU HAVE ANY COMMENTS?<PAGE>
[ ] PLEASE MARK VOTES AS IN THIS EXAMPLE
With- For all
For hold Except For Against Abstain
1.) To elect [ ] [ ] [ ] 2.) To [ ] [ ] [ ]
Class III approve the
Directors of TSYS. Synovus Financial Corp.
Nominees: 1994 Long-Term
Incentive Plan.
Salvador Diaz-Verson, Jr., Mason H. Lampton, The undersigned hereby
William B. Turner, George C. Woodruff, Jr. acknowledges receipt of
and James D. Yancey, NOTICE of said ANNUAL
MEETING and said PROXY
Instruction: To withhold authority to vote STATEMENT and hereby revokes
for any individual nominee for Class III all Proxies heretofore
director of TSYS, mark the "For All Except" given by the undersigned
box and strike a line through the nominee's for said ANNUAL MEETING.
name in the list above.
RECORD DATE SHARES: The Board of Directors
recommends that shareholders
vote FOR each of the
proposals listed herein.
Please be sure to
sign and date this Proxy.[Date: ] Mark box at right [ ]
Shareholder sign here[ ] if comments or address
Co-owner sign here[ ] change have been noted on
the reverse side of this
card.
DETACH CARD DETACH CARD
TOTAL SYSTEM SERVICES, INC.
Dear Shareholder:
Please take note of the important information enclosed with this Proxy
Ballot. There are issues related to the management and operation of your
Company that require your immediate attention and approval. These are
discussed in detail in the enclosed proxy materials.
Your vote counts, and you are strongly encouraged to exercise your right to
vote your shares.
Please mark the boxes on the proxy card to indicate how your shares shall
be voted. Then sign the card, detach it and return your proxy vote in the
enclosed postage paid envelope.
Your vote must be received prior to the Annual Meeting of Shareholders,
April 10, 1995.
Thank you in advance for your prompt consideration of these matters.
Sincerely,
Total System Services, Inc. <PAGE>
APPENDIX B
SYNOVUS FINANCIAL CORP.
1994 LONG-TERM INCENTIVE PLAN
SECTION 1. General Purpose of Plan
The name of this plan is the Synovus Financial Corp. 1994 Long-Term
Incentive Plan (the "Plan"). The purpose of the Plan is to enable Synovus
Financial Corp. (the "Corporation") and its Subsidiaries to attract,
retain, motivate, and reward employees who make a significant contribution
to the Corporation's long-term success, and to enable such employees to
acquire and maintain an equity interest in Synovus Financial Corp.
SECTION 2. Definitions
For purposes of the Plan, the following terms shall be defined as set forth
below:
a. "Award" means any award of Stock Options, Option Price Adjustment
Rights, Stock Appreciation Rights, Restricted Stock, or Performance
Awards, whether in cash or stock or a combination thereof,
authorized by the Committee under this Plan.
b. "Board" means the Board of Directors of the Corporation or the
Executive Committee of the Board of Directors of the Corporation.
c. "Cause" means a felony conviction of a Participant or the failure of
a Participant to contest prosecution for a felony, or a
Participant's willful misconduct, dishonesty, embezzlement, fraud,
deceit or civil rights violations, any of which acts cause the
Corporation or any Subsidiary liability or loss, as determined by
the Board.
d. "Code" means the Internal Revenue Code of 1986, as amended, or any
successor thereto.
e. "Committee" means the Compensation Committee, or any other committee
of the Board appointed for the purpose of administering the Plan,
which committee shall consist exclusively of two or more
Disinterested Persons.
f. "Commission" means the Securities and Exchange Commission.
g. "Corporation" means Synovus Financial Corp.
h. "Disability" means total and permanent physical or mental disability
or incapacity of an employee to fulfill at any time or from time to
time his normal duties as an employee, as certified in writing by
two competent physicians, one of which shall be selected by the
Committee and the other of which shall be selected by the employee
or his duly appointed guardian or legal or personal representative.
In addition, for purposes of determining Disability as it applies to
any Incentive Stock Option, the term "Disability" shall be
interpreted consistently with Code Sections 421-424.
i. "Disinterested Person" shall have the meaning set forth in Rule
16b-3 as promulgated by the Commission under the Securities Exchange
Act of 1934, or any successor definition adopted by the Commission.
The term "Disinterested Person" shall also mean an "outside
director" as set forth in Code Section 162 (m).
j. "Early Retirement" means retirement from active employment with the
Corporation or any Subsidiary pursuant to the early retirement
provisions of the applicable Corporation or Subsidiary pension plan.
k. "Exchange Act" means the Securities Exchange Act of 1934, as
amended, and any successor thereto.
l. "Fair Market Value" means, as of any given date, the closing price
of the Stock on such date (or if no transactions were reported on
such date on the next preceding date on which transactions were so
reported) in the principal market in which such Stock is traded on
such date as reported in The Wall Street Journal (or any other
publication designated by the Committee) except that, with respect
to grants of Restricted Stock, "Fair Market Value" for Restricted
Stock on the date of grant shall be determined as of the time and
date of the Restricted Stock grant by the Compensation Committee.
m. "Incentive Stock Option" means any Stock Option intended to be and
designated as an "incentive stock option" within the meaning of
Section 422 of the Code.
n. "Non-Qualified Stock Option" means any Stock Option that is not an
Incentive Stock Option.
o. "Normal Retirement" means retirement from active employment with the
Corporation or any Subsidiary on or after the normal retirement date
specified in the applicable Corporation or Subsidiary pension plan.
p. "Option Price Adjustment Right" means a right granted under Section
6 in tandem with a Stock Option which entitles the recipient to have
applied as a credit against the exercise price of the related Stock
Option an amount equal to: (i) the total number of shares of stock
subject to the Option Price Adjustment Right (or the portion or
portions thereof which the recipient from time to time elects to use
for this purpose), multiplied by (ii) a fixed percentage of the Fair
Market Value of a share of Stock on a date to be designated by the
Committee.
q. "Participant" means any employee of the Corporation and its
Subsidiaries designated by the Committee to receive an Award under
the Plan.
r. "Performance Award" means an award of shares of Stock or cash to a
Participant pursuant to Section 9 contingent upon achieving certain
performance goals.
s. "Plan" means this Synovus Financial Corp. 1994 Long-Term Incentive
Plan.
t. "Restricted Stock" means an award of shares of Stock that are
subject to restrictions under Section 8.
u. "Retirement" means Normal or Early Retirement under the applicable
Corporation or Subsidiary pension plan.
v. "Stock" means the common stock of the Corporation or any successor
corporation.
w. "Stock Appreciation Right" means a right granted under Section 7,
which entitles the holder to receive a cash payment or an award of
Stock or, if applicable, as a credit against the purchase price of a
related Stock Option, in an amount equal to the difference between
(i) the Fair Market Value of the Stock covered by such right at the
date the right is granted and (ii) the Fair Market Value of the
Stock covered by such right at the date the right is exercised,
unless otherwise determined by the Committee pursuant to Section 7,
multiplied by the number of shares covered by the right.
x. "Stock Option" means any option to purchase shares of Stock granted
to employees pursuant to Section 6.
y. "Subsidiary" means any corporation (other than Synovus Financial
Corp.) in an unbroken chain of corporations beginning with the
Corporation if each of the corporations (other than the last
corporation in the unbroken chain) owns stock possessing 50% or more
of the total combined voting power of all classes of stock in one of
the other corporations in the chain.
SECTION 3. Administration
The Plan shall be administered by the Committee which shall at all times
consist of not less than two Disinterested Persons.
The Committee shall have the power and authority to grant to eligible
employees, pursuant to the terms of the Plan: (i) Stock Options;
(ii) Option Price Adjustment Rights; (iii) Stock Appreciation Rights; (iv)
Restricted Stock; or (v) Performance Awards.
In particular, the Committee shall have the authority:
(i) to select the employees of the Corporation and its Subsidiaries
to whom Stock Options, Option Price Adjustment Rights, Stock
Appreciation Rights, Restricted Stock, or Performance Awards or a
combination of the foregoing from time to time will be granted
hereunder;
(ii) to grant Incentive Stock Options, Non-Qualified Stock Options,
Option Price Adjustment Rights, Stock Appreciation Rights,
Restricted Stock, or Performance Awards, or a combination of the
foregoing, hereunder;
(iii) to determine the number of shares of Stock to be covered by each
such Award granted hereunder;
(iv) to determine the terms and conditions, not inconsistent with the
terms of the Plan, of any Award granted hereunder including, but
not limited to, any restriction on any Award and/or the shares of
Stock relating thereto based on performance and/or such other
factors as the Committee may determine, in its sole discretion,
and any vesting acceleration features based on performance and/or
such other factors as the Committee may determine, in its sole
discretion;
(v) to determine whether, to what extent and under what circumstances
Stock and other amounts payable with respect to an Award under
this Plan shall be deferred either automatically or at the
election of a Participant, including providing for and
determining the amount (if any) of deemed earnings on any
deferred amount during any deferral period.
Subject to Section 10, the Committee shall have the authority to adopt,
alter and repeal such administrative rules, guidelines and practices
governing the Plan as it shall, from time to time, deem advisable; to
interpret the terms and provisions of the Plan and any Award issued under
the Plan (and any agreements relating thereto); and to otherwise supervise
the administration of the Plan.
All decisions made by the Committee pursuant to the provisions of the Plan
shall be final and binding on all persons, including the Corporation and
all Plan Participants.
SECTION 4. Stock Subject to Plan
The total number of shares of Stock reserved and available for distribution
under the Plan shall be 3,000,000. Such shares may consist, in whole or in
part, of authorized and unissued shares or treasury shares.
If any shares of Stock that have been subject to option cease to be subject
to option without having been exercised, or if any shares subject to any
Restricted Stock, Option Price Adjustment Rights, Stock Appreciation
Rights, or Performance Awards granted hereunder are forfeited or such
Awards are otherwise terminated without having been exercised, such shares
shall again be available for distribution in connection with future Awards
under the Plan in each case to the full extent available pursuant to the
rules and interpretations of the Securities and Exchange Commission under
Section 16 of the Exchange Act. In the event that prior to the Award's
cancellation, termination, expiration, or lapse, the holder of the Award at
any time received one or more "benefits of ownership" pursuant to such
Award (as defined by the Securities and Exchange Commission, pursuant to
any rule or interpretation promulgated under Section 16 of the Exchange
Act), the Stock subject to such Award shall not be available for regrant
under the Plan.
In the event of any merger, reorganization, consolidation,
recapitalization, stock dividend, or other change in corporate structure
affecting the Stock, a substitution or adjustment shall be made in the
aggregate number of shares reserved for issuance under the Plan, in the
number and option price of shares subject to outstanding Stock Options
granted under the Plan and in the number of shares subject to Stock
Appreciation Rights, Option Price Adjustment Rights, Restricted Stock or
Performance Awards granted under the Plan as may be determined to be
appropriate by the Committee, in its sole discretion, in order to preserve
each Participant's rights substantially proportionate to the Participant's
rights existing prior to such event, provided that the number of shares
subject to any Award shall always be a whole number. Such adjusted option
price shall also be used to determine the amount payable by the Corporation
upon the exercise of any Stock Appreciation Rights or Option Price
Adjustment Rights associated with any Stock Option the price of which is
adjusted.
Notwithstanding any provision in the Plan to the contrary, the maximum
number of shares of Stock with respect to one or more Awards that may be
granted to any one Participant in any calendar year shall be 200,000.
SECTION 5. Eligibility
Any employee of the Corporation or any of its Subsidiaries (but excluding
members of the Committee and any person who is a director of the
Corporation or any Subsidiary, but not an employee of the Corporation or
any Subsidiary) is eligible to be granted Stock Options, Option Price
Adjustment Rights, Stock Appreciation Rights, Restricted Stock or
Performance Awards. The Participants under the Plan shall be selected from
time to time by the Committee, in its sole discretion, from among those
eligible, and the Committee shall determine, in its sole discretion, the
number of shares covered by each Award or grant.
SECTION 6. Stock Options
Stock Options may be granted either alone or in addition to other Awards
granted under the Plan. Any Stock Option granted under the Plan shall be
in such form as the Committee may from time to time approve, and the
provisions of Stock Option Awards need not be the same with respect to each
optionee.
The Stock Options granted under the Plan may be of two types:
(i) Incentive Stock Options (subject to the provisions of Section 15 of the
Plan) and (ii) Non-Qualified Stock Options.
The Committee shall have the authority to grant any optionee Incentive
Stock Options, Non-Qualified Stock Options, or both types of Stock Options
(in each case with or without Option Price Adjustment Rights or Stock
Appreciation Rights). To the extent that any Stock Option does not qualify
as an Incentive Stock Option, it shall constitute a separate Non-Qualified
Stock Option.
Anything in the Plan to the contrary notwithstanding, no term of this Plan
relating to Incentive Stock Options shall be interpreted, amended or
altered, nor shall any discretion or authority granted under the Plan be so
exercised, so as to disqualify either the Plan or any Incentive Stock
Option under Section 422 of the Code.
Stock Options granted under the Plan shall be subject to the following
terms and conditions and shall contain such additional terms and
conditions, not inconsistent with the terms of the Plan, as the Committee
shall deem desirable:
(a) Option Price. The option price per share of Stock purchasable
under a Stock Option shall be determined by the Committee at the
time of grant. The option price per share of Stock may be equal to
or more or less than the Fair Market Value of the Stock on the date
of grant, except that the option price for any Incentive Stock
Option shall be not less than 100% of the Fair Market Value of the
Stock on the date of the grant of the Stock Option (determined
without regard to any Option Price Adjustment Rights or Stock
Appreciation Rights). If the option is an Incentive Stock Option
and if the employee to whom the Incentive Stock Option is granted
owns directly or indirectly more than 10% of the total combined
voting power of all classes of Stock immediately before the grant
of the option, then the option price per share of Stock must be at
least 110% of the Fair Market Value of the Stock on the date of
grant.
(b) Option Term. The term of each Stock Option shall be fixed by the
Committee, but no Stock Option shall be exercisable more than ten
years after the date such Stock Option is granted. If the option
is an Incentive Stock Option and if the employee to whom the
Incentive Stock Option is granted owns directly or indirectly more
than 10% of the total combined voting power of all classes of Stock
immediately before the grant of the option, then the term of the
option may not exceed five years.
(c) Exercisability. Subject to paragraph (j) of this Section 6 with
respect to Incentive Stock Options, Stock Options shall be
exercisable at such time or times and subject to such terms and
conditions as shall be determined by the Committee at grant,
provided, however, that except as provided in paragraphs (f) and
(g) of Section 6, unless a longer vesting period is otherwise
determined by the Committee at grant, no Stock Option shall be
exercisable for a period of six months after the date of the grant
of the option. If the Committee provides, in its discretion, that
any Stock Option is exercisable only in installments, the Committee
may waive such installment exercise provision at any time in whole
or in part based on performance and/or such other factors as the
Committee may determine in its sole discretion.
(d) Method of Exercise. Stock Options may be exercised in whole or in
part at any time during the exercise period described in Section
6(c) by giving written notice of exercise to the Corporation
specifying the number of shares to be purchased, accompanied by
payment in full of the purchase price, in cash, by check or such
other instrument as may be acceptable to the Committee. If
approved and as determined by the Committee, in its sole
discretion, at or after grant, payment in full or in part may also
be made in the form of unrestricted Stock owned by the optionee
(based on the Fair Market Value of the Stock on the date the option
is exercised, as determined by the Committee). Payment of the
exercise price of a Stock Option and any withholding tax due at
exercise also may be made through any program or procedure
(including but not limited to a broker-dealer cashless exercise
program) if approved by the Committee. No shares of Stock
resulting from the exercise of a Stock Option shall be issued until
full payment therefor has been made. An optionee shall have the
rights to dividends or other rights of a stockholder with respect
to shares subject to the option when the optionee has given written
notice of exercise and has paid in full for such shares.
(e) Non-transferability of Options. No Stock Option shall be
transferable by the optionee, otherwise than by will or by the laws
of descent and distribution, or be subject to attachment, execution
or similar process. All Stock Options shall be exercisable, during
the optionee's lifetime, only by the optionee.
(f) Termination by Death (other than by suicide). Unless otherwise
determined by the Committee at grant, if any optionee's employment
with the Corporation or any Subsidiary terminates by reason of
death (other than by suicide), the Stock Option may thereafter be
immediately exercised, to the extent then exercisable (or on such
accelerated basis as the Committee shall determine at or after
grant), by the legal representative of the estate or by the legatee
of the optionee under the will of the optionee, for a period of one
year from the date of such death or until the expiration of the
stated term of such Stock Option, whichever period is the shorter.
(g) Termination by Reason of Disability. Unless otherwise determined
by the Committee at grant, if any optionee's employment with the
Corporation or any Subsidiary terminates by reason of Disability,
any Stock Option held by such optionee may thereafter be exercised,
to the extent it was exercisable at the time of termination due to
Disability (or on such accelerated basis as the Committee shall
determine at or after grant), but may not be exercised after one
year from the date of such termination of employment or the
expiration of the stated term of such Stock Option, whichever
period is the shorter; provided, however, that, if the optionee
dies within such one year period, any unexercised Stock Option held
by such optionee shall thereafter be exercisable to the extent to
which it was exercisable at the time of death for a period of
twelve months from the date of such death or for the stated term of
such Stock Option, whichever period is the shorter. In the event
of termination of employment by reason of Disability, if an
Incentive Stock Option is exercised after the expiration of the
exercise periods that apply for purposes of Section 422 of the
Code, such Stock Option will thereafter be treated as a
Non-Qualified Stock Option.
(h) Termination by Reason of Retirement. Unless otherwise determined
by the Committee at grant, if any optionee's employment with the
Corporation or any Subsidiary terminates by reason of Normal or
Early Retirement, any Stock Option held by such optionee may
thereafter be exercised to the extent it was exercisable at the
time of such Retirement (or on such accelerated basis as the
Committee shall determine at or after grant), but may not be
exercised after one year from the date of such termination of
employment or the expiration of the stated term of such Stock
Option, whichever period is the shorter; provided, however, that,
if the optionee dies within such one year period any unexercised
Stock Option held by such optionee shall thereafter be exercisable,
to the extent to which it was exercisable at the time of death, for
a period of twelve months from the date of such death or for the
stated term of the Stock Option, whichever period is the shorter.
In the event of termination of employment by reason of Retirement,
if an Incentive Stock Option is exercised after the exercise
periods that apply for purposes of Section 422 of the Code, such
Stock Option will thereafter be treated as a Non-Qualified Stock
Option.
(i) Other Termination. Unless otherwise determined by the Committee at
or after grant, if an optionee's employment with the Corporation or
any Subsidiary terminates for Cause or for death by reason of
suicide or for any reason other than Disability or Normal or Early
Retirement or death other than by suicide, the Stock Option shall
thereupon terminate, except that such Stock Option may be exercised
to the extent such Stock Option could have been exercised on the
date of cessation of employment for the lesser of three months from
the date of termination or the balance of such Stock Option's term
if the optionee's employment with the Corporation or any Subsidiary
is involuntarily terminated by the optionee's employer without
Cause.
(j) Limit on Value of Incentive Stock Options First Exercisable
Annually. The aggregate Fair Market Value (determined at the time
of grant) of the Stock for which "incentive stock options" within
the meaning of Section 422 of the Code are exercisable for the
first time by an optionee during any calendar year under the Plan
(and/or any other stock option plans of the Corporation or any
Subsidiary) shall not exceed $100,000.
(k) Option Price Adjustment Rights. The Committee shall have the
discretion to grant Option Price Adjustment Rights in conjunction
with all or part of any Stock Option granted under the Plan, either
at or after the time of grant of such Stock Option. Option Price
Adjustment Rights shall be exercisable only at such time as and to
the same extent that the Stock Options to which the Option Price
Adjustment Rights relate are exercisable. An Option Price
Adjustment Right granted with respect to a given Stock Option shall
terminate and no longer be exercisable upon the termination or
exercise of the related Stock Option. An Option Price Adjustment
Right may be exercised by an optionee by exercising and
surrendering the applicable potion of the related Stock Option.
Upon such exercise and surrender, the optionee shall be entitled to
have applied as a credit against the exercise price of the related
Stock Option an amount equal to: (i) the total number of shares of
stock subject to the Option Price Adjustment Right (or the portion
or portions thereof which the optionee from time to time elects to
use for this purpose), multiplied by (ii) a fixed percentage of the
Fair Market Value of a share of Stock on a date to be designated by
the Committee.
SECTION 7. Stock Appreciation Rights
(a) Grant and Exercise When Granted in Conjunction With Stock Options.
Stock Appreciation Rights may be granted alone or in conjunction
with all or part of any Stock Option granted under the Plan and may
contain terms and conditions different from those of the related
Stock Option, except as otherwise provided below. In the case of a
Non-Qualified Stock Option, such rights may be granted either at or
after the time of the grant of such Non-Qualified Stock Option. In
the case of an Incentive Stock Option, such rights may be granted
only at the time of the grant of such Incentive Stock Option.
A Stock Appreciation Right or applicable portion thereof granted
with respect to a given Stock Option shall terminate and no longer
be exercisable upon the termination or exercise of the related
Stock Option, except that, unless otherwise provided by the
Committee at the time of grant, a Stock Appreciation Right granted
with respect to less than the full number of shares covered by a
related Stock Option shall only be reduced if and to the extent
that the number of shares covered by the exercise or termination of
the related Stock Option exceeds the number of shares not covered
by the Stock Appreciation Right.
A Stock Appreciation Right may be exercised by an optionee, in
accordance with paragraph (c) of this Section 7, by surrendering
the applicable portion of the related Stock Option. Upon such
exercise and surrender, the optionee shall be entitled to receive
an amount determined in the manner prescribed in paragraph (c) of
this Section 7. Stock Options which have been so surrendered, in
whole or in part, shall no longer be exercisable to the extent the
related Stock Appreciation Rights have been exercised.
(b) Grant and Exercise When Granted Alone. Stock Appreciation Rights
may be granted at the discretion of the Committee in a manner not
related to an award of a Stock Option. The Committee should have
the discretion to determine the terms and conditions of any Stock
Appreciation Rights not related to a Stock Option Award. A Stock
Appreciation Right granted under this Section 7(b) is not
exercisable for a period of six months from the date of grant,
unless a longer period is otherwise determined by the Committee.
The Stock Appreciation Right, granted under Section 7(b), shall be
exercisable in accordance with Section 7(c) over a period not to
exceed ten years. Any Stock Appreciation Right which is
outstanding on the last day of the exercisable period shall be
automatically exercised on such date for cash or Common Stock, as
determined by the Committee, without any action by the holder if,
on that date, the Fair Market Value of the Stock exceeds the
exercise price of the Stock Appreciation Right.
(c) Terms and Conditions. Stock Appreciation Rights shall be subject
to such terms and conditions, not inconsistent with the provisions
of the Plan, as shall be determined from time to time by the
Committee, including the following:
(i) Stock Appreciation Rights granted pursuant to Section 7(a)
shall be exercisable only at such time or times and to the
extent that the Stock Options to which the Stock
Appreciation Rights relate shall be exercisable in
accordance with the provisions of Section 6 and this Section
7 of the Plan; provided, however, that any Stock
Appreciation Right granted subsequent to the grant of the
related Stock Option shall not be exercisable during the
first six months of the term of the Stock Appreciation
Right, except that this additional limitation shall not
apply in the event of death other than by suicide or
Disability of the optionee prior to the expiration of the
six-month period.
(ii) Upon the exercise of a Stock Appreciation Right granted
pursuant to Section 7(a), an optionee shall be entitled to
receive an amount in cash or shares of Stock equal in value
to the excess of the Fair Market Value of one share of Stock
over the option price per share specified in the related
Stock Option, multiplied by the number of shares in respect
of which the Stock Appreciation Right shall have been
exercised, with the Committee having the right to determine
the form of payment. Upon the exercise of a Stock
Appreciation Right granted pursuant to Section 7(b), the
holder shall be entitled to receive an amount in cash or
shares of Stock equal in value to the excess of the Fair
Market Value of one share of Stock over the Fair Market
Value of one share of Stock at the date the Stock
Appreciation Right was granted multiplied by the number of
shares in respect of which the Stock Appreciation Right
shall have been exercised, with the Committee having the
right to determine the form of payment.
(iii) No Stock Appreciation Right shall be transferable by the
holder, other than by will or the laws of descent and
distribution, or be subject to attachment, execution or
similar process. All Stock Appreciation Rights shall be
exercisable, during the holder's lifetime, only by the
holder.
(iv) Upon the exercise of a Stock Appreciation Right granted
pursuant to Section 7(a), the Stock Option or part thereof
to which such Stock Appreciation Right is related shall be
deemed to have been exercised for the purpose of the
limitation set forth in Section 4 of the Plan on the number
of shares of Stock to be issued under the Plan.
(v) A Stock Appreciation Right granted in connection with an
Incentive Stock Option pursuant to Section 7(a), may be
exercised only if and when the market price of the Stock
subject to the Incentive Stock Option exceeds the exercise
price of such Stock Option.
(vi) In its sole discretion, the Committee may provide, at the
time of grant of a Stock Appreciation Right under this
Section 7, that such Stock Appreciation Right can be
exercised only in the event of a "Change of Control" (as
defined in Section 12 below). Furthermore, the Committee
may provide, at the time of grant of any Stock Appreciation
Right, that such Stock Appreciation Right can be exercised
only upon the attainment of specified performance goals or
other such criteria as the Committee may determine in its
sole discretion.
(vii) In the discretion of the Committee, if the Plan is approved
by the shareholders of the Corporation in accordance with
Section 15 of the Plan, a Stock Appreciation Right may
provide that any exercise by a Participant of all or a
portion of a Stock Appreciation Right for cash, may only be
made during the period beginning on the third business day
following the date of the Corporation's release of its
quarterly or annual summary statements of earnings to the
public and ending on the twelfth business day following such
date; provided, however, that the foregoing shall not apply
to any exercise by a Participant of a Stock Appreciation
Right for cash where the date of exercise is automatic or
fixed in advance under the Plan and is outside the control
of the Participant.
SECTION 8. Restricted Stock
(a) Administration. Shares of Restricted Stock may be issued either
alone or in addition to other Awards granted under the Plan. The
Committee shall determine the employees of the Corporation and its
Subsidiaries to whom, and the time or times at which, grants of
Restricted Stock will be made, the number of shares to be awarded,
the price, if any, to be paid by the recipient of Restricted Stock
(subject to Section 8(b) hereof), the time or times within which
such Awards may be subject to forfeiture, the nature of the
restrictions, including any performance requirements, the
circumstances under which restrictions will lapse and all other
conditions of the Awards. The Committee may also condition the
grant of Restricted Stock upon the attainment of specified
performance goals, or such other criteria as the Committee may
determine, in its sole discretion. The provisions of Restricted
Stock Awards need not be the same with respect to each recipient.
(b) Awards and Certificates. The prospective recipient of an Award of
shares of Restricted Stock shall not have any rights with respect
to such Award, unless and until such recipient has executed an
agreement evidencing the Award (a "Restricted Stock Award
Agreement") and has delivered a fully executed copy thereof to the
Corporation, and has otherwise complied with the then applicable
terms and conditions.
(i) Awards of Restricted Stock must be accepted within a period
of thirty days (or such shorter period as the Committee may
specify) after the Award date by executing a Restricted
Stock Award Agreement and paying whatever price, if any, is
required.
(ii) Each Participant who is awarded Restricted Stock shall be
issued a stock certificate in respect of such shares of
Restricted Stock to be held in escrow as described below.
Such certificate shall be registered in the name of the
Participant, and shall bear an appropriate legend referring
to the terms, conditions, and restrictions applicable to
such Award, substantially in the following form:
"The transferability of this certificate and the shares
of stock represented hereby are subject to the terms and
conditions (including forfeiture) of the Synovus
Financial Corp. 1994 Long-Term Incentive Plan and a
Restricted Stock Award Agreement entered into between the
registered owner and Synovus Financial Corp. Copies of
such Plan and Agreement are on file in the offices of
Synovus Financial Corp., One Arsenal Place, 901 Front
Avenue, Suite 301, Columbus, Georgia, 31901."
(iii) The Committee shall require that the stock certificate
evidencing such shares be held in escrow by Columbus Bank
and Trust Company ("CB&T"), or any other escrow agent
designated by the Committee until the restrictions thereon
shall have lapsed, and that, as a condition of any
Restricted Stock Award, the Participant shall have delivered
a stock power, endorsed in blank, relating to the Stock
covered by such Award. In the event the Participant has
obtained a loan from CB&T or other escrow agent in order to
purchase the Restricted Stock or to pay any taxes due with
respect to the Restricted Stock, CB&T or other escrow agent
shall have the right to require that the shares continue to
be held in escrow until such loan is repaid.
(c) Restrictions and Conditions. The shares of Restricted Stock
awarded pursuant to this Section 8 shall be subject to the
following restrictions and conditions:
(i) Subject to the provisions of this Plan and Restricted Stock
Award Agreements, during the period of six months after the
Award or such longer period as may be set by the Committee
commencing on the grant date (the "Restriction Period"), the
Participant shall not be permitted to sell, transfer, pledge
or assign shares of Restricted Stock awarded under the Plan.
Within these limits, the Committee may, in its sole
discretion, provide for the lapse of such restrictions in
installments and may accelerate or waive such restrictions
in whole or in part based on performance and/or such other
factors as the Committee may determine, in its sole
discretion.
(ii) Except as provided in paragraph (c)(i) of this Section 8,
the Participant shall have, with respect to the shares of
Restricted Stock, all of the rights of a stockholder of the
Corporation, including the right to receive any dividends,
unless the Committee shall declare otherwise at the time of
the Award.
Dividends paid in cash with respect to shares of Restricted
Stock shall not be subject to any restrictions or subject to
forfeiture. Dividends paid in Stock of the Corporation or
Stock received in connection with a stock split with respect
to Restricted Stock shall be subject to the same
restrictions as on such Restricted Stock. Certificates for
shares of unrestricted Stock shall be delivered to the
Participant promptly after, and only after, the period of
forfeiture shall expire without forfeiture in respect of
such shares of Restricted Stock and the repayment of any
loans obtained from CB&T to purchase the Restricted Stock or
to pay any taxes due with respect to the Restricted Stock.
(iii) Subject to the provisions of the Restricted Stock Award
Agreement and this Section 8, upon termination of employment
for any reason during the Restriction Period, all shares
still subject to restriction (together with any price paid
for such shares by the Participant) shall be forfeited by
the Participant, unless otherwise determined by the
Committee.
(iv) The Committee may, in its sole discretion, waive in whole or
in part any or all restrictions with respect to any
Participant's shares of Restricted Stock.
SECTION 9. Performance Awards
(a) Administration. Shares of Stock and/or a payment in cash may be
distributed under the Plan to an employee upon the attainment of
performance objectives, as a Performance Award. The Committee
shall determine the employees of the Corporation and its
Subsidiaries to whom Performance Awards are granted, the terms and
conditions of the performance objectives, the term of the
performance period and the value and form of the payment of the
Performance Award.
(b) Performance Objectives. The Committee, in its sole discretion may
establish, under this Section 9, performance objectives either in
terms of Corporation-wide objectives or in terms of objectives that
are related to the specific performance of an employee or a bank, a
group, division, department, or Subsidiary within the Corporation
in which the Participant is employed. A minimum level of
performance, at the discretion of the Committee, may be
established.
If, at the end of the performance period, the specified objectives
have been attained, the Participant is deemed to have fully earned
the Performance Award. If such performance objectives are only
partially attained, the Participant may be deemed by the Committee
to have partly earned the Performance Award and would become
eligible to receive a portion of the total Award, as determined by
the Committee. If a required minimum level of achievement has not
been met, as determined by the Committee, the Participant is
entitled to no portion of the Performance Award. If, at the end of
the performance period, performance exceeds the target, the
Participant, at the Committee's discretion, may receive a multiple
of the Performance Award. The Committee may adjust the payment of
Awards or the performance objectives if events occur or
circumstances arise which would cause a particular payment or set
of performance objectives to be inappropriate as a measure of
performance.
(c) Terms and Conditions. A Participant to whom a Performance Award
has been granted is given performance objectives to be reached over
a specified period, the "performance period." Generally this
period shall be not less than one year.
Any Participant granted a Performance Award pursuant to this
Section 9 who by reason of death (other than by suicide),
Disability or Retirement terminates employment before the end of
the performance period is entitled to receive a portion of any
earned Performance Award. The Committee, in its discretion, will
determine the amount of the Performance Award earned, if any, and
the time at which payment will be made.
A Participant who terminates employment for any other reason,
including death by suicide, forfeits all rights under the
Performance Award.
SECTION 10. Amendments and Termination
The Board may amend, alter, or discontinue the Plan at any time, but no
amendment, alteration, or discontinuation shall be made which affects an
existing Award under the Plan without the optionee's or Participant's
consent. If stockholder approval of this Plan is obtained, no amendment,
alteration or discontinuation shall be made by the Board which, without the
approval of the stockholders, would:
(a) increase the total number of shares reserved for the purpose of the
Plan, except as provided for in accordance with Section 4 of the
Plan;
(b) decrease the option price of any Stock Option to less than 100% of
the Fair Market Value on the date of the granting of the option,
except as provided for in accordance with Section 4 of the Plan;
(c) change the Participants or class of Participants eligible to
participate in the Plan;
(d) extend the maximum option period under paragraph (b) of Section 6
of the Plan; or
(e) materially increase in any other way the benefits accruing to
Participants.
The Committee may amend the terms of any Award or option theretofore
granted, prospectively or retroactively, but no such amendment shall affect
an existing Award under the Plan without the Participant's consent. The
Committee may also substitute new Stock Options for previously granted
Stock Options, including options granted under other plans applicable to
the Participant, and previously granted Stock Options having higher option
prices.
SECTION 11. Change of Control
The following provisions shall apply in the event of a "Change of Control,"
as defined in this Section 11:
(a) In the event of a "Change of Control" as defined in paragraph (c)
of this Section 11, the vesting of any outstanding Stock Options,
Option Price Adjustment Rights, Stock Appreciation Rights,
Restricted Stock or Performance Awards shall be accelerated so that
all Awards not previously exercisable and vested are fully
exercisable and vested.
(b) If the employment of a Participant is terminated for any reason
following a Change of Control, any outstanding Stock Options,
Option Price Adjustment Rights, Stock Appreciation Rights,
Restricted Stock or Performance Awards granted to the Participant
that are not fully exercisable and vested shall become fully
exercisable and vested as of the date of such termination of
employment and any obligations to pay amounts to the Corporation or
any Subsidiary in connection with an Award shall be terminated as
of the date of such termination of employment.
(c) For purposes of this Section 11, a "Change of Control" means the
happening of any of the following:
(i) when any "person," as such term is used in Section 13(d) and
14(d) of the Exchange Act (other than the Corporation or a
Subsidiary or any Corporation employee benefit plan
(including its trustee)), is or becomes the "beneficial
owner" (as defined in Rule 13d-3 under the Exchange Act),
directly or indirectly of securities of the Corporation
representing 20% or more of the combined voting power of the
Corporation's then outstanding securities;
(ii) the occurrence of a transaction requiring stockholder
approval for the acquisition of the Corporation by an entity
other than the Corporation or a Subsidiary through purchase
of assets, or by merger, or otherwise;
(iii) the filing of an application with any regulatory authority
having jurisdiction over the ownership of the Corporation by
any "person," as defined in the preceding paragraph, to
acquire 20% or more of the combined voting power of the
Corporation's then outstanding securities; or
(iv) the occurrence of a "Triggering Event" as such term is
defined in the Rights Agreement dated April 20, 1989, by and
between the Corporation and Trust Company Bank, the
provisions of which are incorporated herein by this
reference.
(d) For purposes of this Section 11, a "Change of Control" shall not
result from any transaction precipitated by the Corporation's
insolvency, appointment of a conservator, or determination by a
regulatory agency that the Corporation is insolvent, nor from any
transaction initiated by the Corporation in regard to creating a
holding company of which the Corporation would be a primary entity,
nor from any transaction initiated by the Corporation in regard to
converting from a publicly traded company to a privately held
company.
SECTION 12. General Provisions
(a) All certificates for shares of Stock delivered under the Plan shall
be subject to such stock transfer orders and other restrictions as
the Committee may deem advisable under the rules, regulations, and
other requirements of the Commission, any stock exchange upon which
the Stock is then listed, and any applicable Federal or state
securities or other laws, and the Committee may cause a legend or
legends to be put on any such certificates to make appropriate
reference to such restrictions.
(b) Nothing set forth in this Plan shall prevent the Board from
adopting other or additional compensation arrangements, subject to
stockholder approval if such approval is required; and such
arrangements may be either generally applicable or applicable only
in specific cases. The Corporation and its Subsidiaries
specifically reserve the right to terminate (whether by dismissal,
discharge, retirement or otherwise) any Participant's employment
with the Company or a Subsidiary at any time at will. Neither the
granting of an Award nor the adoption of the Plan shall confer upon
any employee of the Corporation or its Subsidiaries any right to
continued employment with the Corporation or a Subsidiary, as the
case may be, nor shall it interfere in any way with the right of
the Corporation or a Subsidiary to terminate the employment of any
of its employees at any time.
(c) Each Participant shall, no later than the date as of which the
value of an Award first becomes includable in the gross income of
the Participant for Federal income tax purposes, pay to the
Corporation, or make arrangements satisfactory to the Committee
regarding payment of, any Federal, state, or local taxes of any
kind required by law to be withheld with respect to the Award. The
obligations of the Corporation under the Plan shall be conditional
on such payment or arrangements and the Corporation (and, where
applicable, its Subsidiaries), shall, to the extent permitted by
law, have the right to deduct any such taxes from any payment of
any kind otherwise due to the Participant. A Participant may
irrevocably elect to have the withholding tax obligations or, in
the case of all Awards hereunder except Stock Options which have
related Option Price Adjustment Rights or Stock Appreciation
Rights, if the Committee so determines, any additional tax
obligation with respect to any Awards hereunder satisfied by (a)
having the Corporation withhold shares of Stock otherwise
deliverable to the Participant with respect to the Award or (b)
delivering to the Corporation shares of unrestricted Stock;
provided, however, that if the Participant is an "officer" of the
Corporation within the meaning of Section 16 of the Exchange Act,
no such election shall be made (i) unless the Plan has been
approved by shareholders in accordance with Section 15 of the Plan
and (ii) such election is made either (a) during one of the
"window" periods described in section (c)(3)(iii) of Rule 16b-3
promulgated under the Exchange Act, or (b) at least six months
prior to the date income is recognized with respect to the Award.
(d) No members of the Board or the Committee, nor any officer or
employee of the Corporation acting on behalf of the Board or the
Committee, shall be personally liable for any action,
determination, or interpretation taken or made in good faith with
respect to the Plan, and all members of the Board or the Committee
and each and any officer or employee of the Corporation acting on
their behalf shall, to the extent permitted by law, be fully
indemnified and protected by the Corporation in respect of any such
action, determination or interpretation provided such individual
first gives the Corporation an opportunity, at its own expense, to
handle and defend any legal action before such individual
undertakes to handle and defend such legal action.
(e) The existence of Stock Options, Option Price Adjustment Rights,
Stock Appreciation Rights, Restricted Stock and Performance Awards
shall not affect the right or power of the Corporation and its
shareholders to make adjustments, recapitalizations,
reorganizations, or other changes to the Corporation's capital
structure or its business; issue bonds, debentures, preferred or
prior preference stocks affecting the Corporation's Common Stock or
the rights thereof; dissolve or liquidate the Corporation, or sell
or transfer any part of its assets or business; or any other
corporate act, whether of a similar character or otherwise.
(f) The validity, interpretation, and administration of the Plan and of
any rules, regulations, determinations, or decisions made
thereunder, and the rights of any and all persons having or
claiming to have any interest therein or thereunder, shall be
determined exclusively in accordance with the laws of the State of
Georgia, except where those laws may be superseded by the laws of
the United States of America. Without limiting the generality of
the foregoing, the period within which any action in connection
with the Plan must be commenced shall be governed by the laws of
the State of Georgia.
(g) The obligation of the Corporation to make payment of Awards in
Stock shall be subject to all applicable laws, rules and
regulations, and to such approvals by government agencies as may be
required. The Corporation shall be under no obligation to register
under the Securities Act of 1933, as amended from time to time
("1993 Act"), any of the shares of Stock paid under the Plan. If
the Stock paid under the Plan may in certain circumstances be
exempt from registration under the 1933 Act, the Corporation may
restrict the transfer of such Stock in such manner as it deems
advisable to ensure the availability of any such exemption.
SECTION 13. Cash Awards and Loans
The Committee, in its sole discretion, at any time may authorize special
cash Awards to Participants to enable them to fund the exercise price of a
Stock Option or any taxes that must be paid or withheld upon the exercise
of a Stock Option, Option Price Adjustment Right or Stock Appreciation
Right, to fund the purchase price (if any) of Restricted Stock or any taxes
that must be paid or withheld with respect to Restricted Stock, or to fund
any taxes that must be paid or withheld with respect to any Performance
Award. The Committee in its sole discretion, at any time, may assist a
Participant in obtaining a loan for any funds required in connection with
any aspect of the Plan, including without limitation the exercise or
purchase price of any Award and any taxes that must be paid or withheld in
connection with any Award.
SECTION 14. Accounting
It is the intent of the Board that the accounting expenses for any Awards
under this Plan to employees of Subsidiaries be charged to the Subsidiaries
employing such employees and not to the Corporation. The Board of
Directors and the Committee shall have the right to adopt any policies and
procedures required in order to carry out this intent.
SECTION 15. Effective Date of Plan
The Plan shall become effective upon the earlier of its adoption by the
Board of Directors or by the Executive Committee of the Board of Directors;
provided, however, that Incentive Stock Options awarded hereunder shall be
automatically converted into Non-Qualified Stock Options if shareholder
approval of the Plan is not obtained within twelve months of the Plan's
effective date.
SECTION 16. Term of Plan
No Stock Option, Option Price Adjustment Right, Stock Appreciation Right,
Restricted Stock or Performance Award shall be granted pursuant to the Plan
on or after the tenth anniversary of the effective date of the Plan, but
Awards theretofore granted may extend beyond that date.
SECTION 17. Execution
IN WITNESS WHEREOF, the Corporation has caused this Plan to be signed by
its duly authorized officers as of this 28th day of June, 1994.
SYNOVUS FINANCIAL CORP.
By: /s/ G. Sanders Griffith, III
Title: Executive Vice President
General Counsel and Secretary<PAGE>
