SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the
Securities Exchange Act of 1934
(Amendment No. ___)
Filed by the Registrant [x]
Filed By a Party other than the Registrant [ ]
Check the appropriate box:
[x] Preliminary Proxy Statement
[ ] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to Section 240.14a-11(c) or Section
240.14a-12
Summit Bancshares, Inc.
______________________________________________________________________________
(Name of Registrant as Specified In Its Charter)
______________________________________________________________________________
(Name of Person(s) Filing Proxy Statement)
Payment of Filing Fee (Check the appropriate box):
[x] $125 per Exchange Act Rules 0-11(c)(1)(ii), 14a-6(j)(1), or 14a-6(j)(2).
[ ] $500 per each party to the controversy pursuant to Exchange Act Rules
14a-6(i)(3).
[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and 0-11.
1) Title of each class of securities to which transaction applies:
________________________________________________________________
2) Aggregate number of securities to which transaction applies:
________________________________________________________________
3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11:*
________________________________________________________________
4) Proposed maximum aggregate value of transaction:
________________________________________________________________
*Set forth the amount on which the filing fee is calculated and state
how it was determined.
[ ] Check box if any part of the fee is offset as provided by Exchange Act
Rule 0-11(a)(2) and identify the filing for which the offsetting fee was paid
previously. Identify the previous filing by registration statement number, or
the Form or Schedule and the date of its filing.
1) Amount Previously Paid:
_______________________________________________
2) Form, Schedule or Registration Statement No.:
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3) Filing Party:
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4) Date Filed:
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<PAGE>
SUMMIT BANCSHARES, INC.
1300 SUMMIT AVENUE
FORT WORTH, TEXAS 76102
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
APRIL 18, 1995
Notice is hereby given that the Annual Meeting of Shareholders of Summit
Bancshares, Inc. (the "Corporation") will be held at Summit National Bank, 1300
Summit Avenue, Fort Worth, Texas on April 18, 1995, at 4:30 p.m., for the
following purposes:
1. To elect a Board of Directors of the Corporation consisting of
thirteen (13) persons.
2. To ratify the appointment by the Board of Directors of Stovall,
Grandey & Whatley as independent auditors of the Corporation for its fiscal
year ending December 31, 1995.
3. To approve the amendment of the Articles of Incorporation of the
Corporation by amending Article 4 thereof to increase the number of shares of
Common Stock of the Corporation that the Corporation is authorized to issue
from 8,000,000 to 20,000,000 shares.
4. To approve the amendment of the Articles of Incorporation of the
Corporation by deleting Article 14 thereof in its entirety.
5. To approve the amendment of the Articles of Incorporation of the
Corporation by deleting Article 15 thereof in its entirety.
6. To approve the amendment of the Articles of Incorporation of the
Corporation to add thereto a new Article (to be numbered as the next numbered
Article) to provide that special meetings of the shareholders, for any purpose
or purposes, unless otherwise prescribed by statute or by the Articles of
Incorporation, may be called by the President, the Board of Directors or the
holders of not less than three-tenths (3/10) of all the shares entitled to vote
at the meetings.
7. To transact such other business as may properly come before the
Annual Meeting of Shareholders or any adjournment or adjournments thereof.
Only those shareholders of record at the close of business on March 17,
1995 are entitled to notice of and to vote at the Annual Meeting of
Shareholders or at any adjournment or adjournments thereof.
IMPORTANT
All shareholders are urged to sign, date and return as promptly as
possible the enclosed proxy in the enclosed postage-paid envelope. It is
important that as many shares as possible be represented at the Annual Meeting
of Shareholders. Consequently, whether or not you expect to be present, please
execute and return the enclosed proxy.
By Order of the Board of Directors,
Philip E. Norwood, President
March __, 1995
Fort Worth, Texas
<PAGE>
SUMMIT BANCSHARES, INC.
1300 SUMMIT AVENUE
FORT WORTH, TEXAS 76102
TELEPHONE (817) 336-8383
PROXY STATEMENT FOR ANNUAL
MEETING OF SHAREHOLDERS
April 18, 1995
This statement is furnished in connection with the solicitation of proxies
by the Board of Directors of SUMMIT BANCSHARES, INC. (the "Board") to be used
at the Annual Meeting of Shareholders of SUMMIT BANCSHARES, INC.(the
"Corporation") to be held at Summit National Bank, 1300 Summit Avenue, Fort
Worth, Texas on April 18, 1995, at 4:30 p.m., and at any adjournment or
adjournments thereof. This Proxy Statement and accompanying proxy are being
mailed on or about March 28, 1995 to the shareholders of the Corporation.
GENERAL INFORMATION
The close of business on March 17, 1995 has been fixed as the record date
for determining the shareholders entitled to vote at the Annual Meeting of
Shareholders to be held on April 18, 1995.
The Annual Meeting of Shareholders has been called for the purposes of (i)
electing directors of the Corporation for the coming year, (ii) ratifying the
appointment by the Board of Directors of Stovall, Grandey & Whatley as
independent auditors of the Corporation for its fiscal year ending December 31,
1995, (ii) approving the amendment of the Articles of Incorporation of the
Corporation by amending Article 4 thereof to increase the number of shares of
Common Stock of the Corporation that the Corporation is authorized to issue
from 8,000,000 to 20,000,000 shares, (iii) approving the amendment of the
Articles of Incorporation of the Corporation by deleting Article 14 thereof in
its entirety, (iv) approving the amendment of the Articles of Incorporation of
the Corporation by deleting Article 15 thereof in its entirety, (v) approving
the amendment of the Articles of Incorporation the Corporation to add thereto a
new Article (to be numbered as the next numbered Article) to provide that
special meetings of the shareholders, for any purpose or purposes, unless
otherwise prescribed by statute or by the Articles of Incorporation, may be
called by the President, the Board of Directors or the holders of not less than
three-tenths (3/10) of all the shares entitled to vote at the meetings, and
(vi) transacting such other business as may properly come before the Annual
Meeting of Shareholders or any adjournment or adjournments thereof.
Whether you can attend the meeting or not, your vote is important. Shares
can be voted at the meeting only if the owner is present or represented by
proxy. Accordingly, it is requested that you sign and return the enclosed
proxy in the envelope provided.
Any person executing the accompanying proxy may revoke it at any time prior
to the actual voting thereof by filing with the Secretary of the Corporation a
written revocation thereof or a duly executed proxy bearing a later date.
Shares represented by each signed proxy received by the Board will be
voted in accordance with the direction specified by the shareholder, and if no
direction is specified, such shares will be voted "FOR" each proposal.
The cost of soliciting proxies will be borne by the Corporation. The
solicitation will be made by mail. The Corporation will also supply brokerage
firms and other custodians, nominees and fiduciaries with such number of proxy
materials as they may require for mailing to beneficial owners, and will
reimburse them for their reasonable expenses in connection therewith. Certain
directors, officers and employees of the Corporation, not specifically employed
for the purpose, may solicit proxies, without remuneration therefore, by mail,
telephone, telegraph or personal interview.
OUTSTANDING SHARES AND VOTING RIGHTS
At the close of business on March 17, 1995, the record date for determining
the shareholders of the Corporation entitled to notice of and to vote at the
Annual Meeting of Shareholders, the Corporation had 1,578,923 shares of common
stock, $1.25 par value (the "Common Stock"), issued and outstanding.
The presence, in person or by proxy duly authorized in writing, of the
holders of a majority of the issued and outstanding shares of Common Stock of
the Corporation is necessary to constitute a quorum at the Annual Meeting of
Shareholders.
When a quorum is present at any meeting, the vote of the holders of a
majority of the shares having voting power, present in person or represented by
proxy, shall decide any question brought before such meeting.
Each holder of shares of Common Stock will be entitled to one vote, in
person or by proxy, for each share of Common Stock of the Corporation owned of
record at the close of business on March 17, 1995. Cumulative voting for
directors is not permitted. Directors are elected by plurality vote.
PROPOSAL NO. 1:
ELECTION OF DIRECTORS
The bylaws of the Corporation provide that the Board shall be comprised of
not more than twenty-five (25) members and that each director shall be elected
to serve until the next Annual Meeting of Shareholders and until his successor
shall be elected and shall qualify. Any vacancies on the Board may be filled
by a majority vote of the Board and any director so elected shall hold office
for the unexpired term of his predecessor or until the next election of
directors by the shareholders of the Corporation.
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Names of the nominees for directors and other information about them appear
in the following table. All of the nominees are now directors of the Corpora-
tion and have consented to serve if elected. If for any unforeseen reason a
nominee is unable to serve if elected, the persons named in the accompanying
proxy may exercise their discretion to vote for a substitute nominee selected
by the Board. However, the Board has no reason to anticipate that any of the
nominees will not be able to serve, if elected.
NAME AND AGE OF
NOMINEE; YEARS PRINCIPAL OCCUPATION FOR PAST
SERVED AS DIRECTOR FIVE YEARS; OTHER DIRECTORSHIPS
Philip E. Norwood Mr. Norwood became President of Camp Bowie
Age 45 National Bank in July 1994, President and Chief
Director Since 1984 Executive Officer of the Corporation in October
1993 and Chairman of the Board and Chief
Executive Officer of Alta Mesa National Bank in
December 1992, and continues to serve in these
capacities. He has served as a director of the
Corporation since March 1984. From January 1990
to October 1993 Mr. Norwood served as Secretary
of the Corporation, from December 1992 to
October 1993 he served as Executive Vice
President of the Corporation, and from March 1984
to January 1990 he served as Secretary and
Treasurer of the Corporation. From April 1981
to December 1992 Mr. Norwood served as President
of Alta Mesa National Bank. Mr. Norwood has
served as a director of Alta Mesa National Bank
since April 1981, as a director of Summit
National Bank since March 1983 and as a director
of Camp Bowie National Bank since January 1990.
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NAME AND AGE OF
NOMINEE; YEARS PRINCIPAL OCCUPATION FOR PAST
SERVED AS DIRECTOR FIVE YEARS; OTHER DIRECTORSHIPS
James L. Murray Mr. Murray became Chairman of the Board of the
Age 62 Corporation in January 1985, and Chairman of the
Director Since 1979 Board of Camp Bowie National Bank in January
1990, and continues to serve in these
capacities. Mr. Murray served as Chief Executive
Officer of the Corporation from January 1990 to
October 1993, as President of the Corporation
from 1979 to January 1985, as President
of Camp Bowie National Bank from January 1990
to January 1994, and as Chairman of the
Board of Directors of Summit National Bank from
October 1981 to January 1990. He has served as
a director of Summit National Bank since
January 1975 and of Camp Bowie National Bank
since April 1985. Additionally, Mr. Murray was
a director of Alta Mesa National Bank from
April 1981 to April 1985. He was reelected to
the Board of Directors of Alta Mesa National
Bank in January 1990.
F. S. Gunn Mr. Gunn became Vice Chairman of the Board of
Age 61 the Corporation in October 1993. From January
Director Since 1990 to October 1993 Mr. Gunn served as President
of the Corporation, and from January 1985
to January 1990 he previously served as Vice
Chairman of the Board of the Corporation. Mr.
Gunn has served as Chairman of the Board of
Summit National Bank since January 1991, and
served as President of Summit National Bank
from October 1981 to January 1991. He has
served as a director of Summit National Bank
since January 1975, as a director of Alta Mesa
National Bank since March 1982 and as a director
of Camp Bowie National Bank since January 1990.
Jeffrey M. Harp Mr. Harp became Chief Operating Officer and
Age 46 Secretary of the Corporation in October 1993,
Director Since 1990 Executive Vice President of the Corporation in
December 1992, and Treasurer and a director of
the Corporation in January 1990, and continues
to serve in these capacities. He has served as
President of Summit National Bank since January
1991, and served as Executive Vice President of
Summit National Bank from February 1985 to
December 1990. He has served as a director of
Summit National Bank, Alta Mesa National Bank
and Camp Bowie National Bank since January 1990.
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NAME AND AGE OF
NOMINEE; YEARS PRINCIPAL OCCUPATION FOR PAST
SERVED AS DIRECTOR FIVE YEARS; OTHER DIRECTORSHIPS
Robert E. Bolen Mr. Bolen is Senior Advisor to the Chancellor of
Age 68 Texas Christian University. Mr. Bolen served as
Director Since 1984 the Mayor of the City of Fort Worth from 1983
to May 1991. Since April 1981 Mr. Bolen has
served as a director of Alta Mesa National Bank.
Joe L. Bussey, M.D. Dr. Bussey is an ophthalmologist. He has served
Age 69 as a director of Summit National Bank since
Director Since 1984 January 1975 and as a director of Alta Mesa
National Bank since April 1981.
Elliott S. Garsek Mr. Garsek has been an attorney with, and is
Age 45 Chairman of the Board of, the law firm of Barlow
Director Since 1987 & Garsek, a Professional Corporaton, since
February 1984. He has served as a director of
Camp Bowie National Bank since June 1984.
Ronald J. Goldman Mr. Goldman is presently involved in personal
Age 52 investments. From June 1989 to June 1991 Mr.
Director Since 1984 Goldman was a consultant to Tarrant Distributors,
a wholesale liquor and wine distributorship
located in Fort Worth, Texas. Mr. Goldman
served as President of White Rose Distributing
Company, a liquor and wine distributorship
located in Fort Worth, Texas, from March 1973
until September 1989. Mr. Goldman served as
a director of Ganucheau Stupfel & Brumley
Investment Counsel, an investment advisory firm
located in Fort Worth, Texas, from 1988 to
December 1993. Mr. Goldman has served as a
director of Summit National Bank since January
1975 and as a director of Alta Mesa National
Bank since April 1981.
William W. Meadows Mr. Meadows has served as Executive Vice
Age 42 President of Wm. Rigg Co. since 1986, and has
Director Since 1991 been employed by that company since 1976 in
various executive capacities. Mr. Meadows is
currently serving on the Fort Worth City
Council. Mr. Meadows has served as a director
of Camp Bowie National Bank since June 1984.
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NAME AND AGE OF
NOMINEE; YEARS PRINCIPAL OCCUPATION FOR PAST
SERVED AS DIRECTOR FIVE YEARS; OTHER DIRECTORSHIPS
Edward P. Munson Mr. Munson is an independent oil operator. He
Age 74 served as Chairman of the Board of Euratex
Director Since 1984 Corporation, a corporation engaged in oil and
gas exploration, development and production,
from August 1983 to February 1984. Mr. Munson
has served as a director of Summit National
Bank since March 1978.
Lynn C. Perkins, M.D. Dr. Perkins is a physician. Dr. Perkins has
Age 65 served as a director of Alta Mesa National
Director Since 1984 Bank since April 1981.
Byron B. Searcy Mr. Searcy has served as President of Ferree
Age 58 & Searcy, Inc., a corporation engaged in the
Director Since 1984 real estate brokerage business in Fort Worth,
Texas, since 1962. Mr. Searcy has served as a
director of Summit National Bank since January
1975 and as a director of Alta Mesa National
Bank since April 1981.
Lloyd J. Weaver Mr. Weaver was a certified public accountant
Age 73 with Weaver & Tidwell, Fort Worth, Texas from
Director Since 1981 1950 until his retirement in December 1986.
Mr. Weaver has served as a director of Summit
National Bank since January 1975, and served
as a director of Alta Mesa National Bank from
April 1981 to December 1991.
No family relationships exist among the named executive officers and
directors of the Corporation. No director of the Corporation is a director of
any company with a class of securities registered pursuant to Section 12 of the
Securities Exchange Act of 1934, as amended, or subject to the requirements of
Section 15(d) of that Act or of any company registered as an investment company
under the Investment Corporation Act of 1940, as amended.
THE BOARD RECOMMENDS THAT THE SHAREHOLDERS VOTE "FOR" THE ELECTION AS
DIRECTORS OF THE THIRTEEN (13) PERSONS NAMED ABOVE.
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BOARD OF DIRECTORS
Directors are elected annually by the shareholders of the Corporation for
one year and hold office until their successors are elected and have qualified.
Various meetings of the Board are held each year, including an organizational
meeting following the conclusion of the Annual Meeting of Shareholders. The
Board has established an Executive Committee, an Audit Committee, an
Asset/Liability Management Committee (the "ALCO Committee") and a Compensation
and Benefits Committee (the "Compensation Committee"). The Board does not have
a standing nominating committee or a committee performing a similar function.
EXECUTIVE COMMITTEE
Members: Joe L. Bussey, M.D., Ronald J. Goldman, F. S. Gunn, Jeffrey M.
Harp, James L. Murray, Philip E. Norwood, Byron B. Searcy and Lloyd J. Weaver.
The function of the Executive Committee is to manage the business and
affairs of the Corporation to the extent delegated to the Executive Committee
by the Board.
AUDIT COMMITTEE
Members: Lloyd J. Weaver (Chairman), William W. Meadows, Edward P.
Munson and Lynn C. Perkins, M.D.
The functions of the Audit Committee are to (I) meet with the independent
auditors of the Corporation to review the annual audit and its results, (ii)
review internal audit controls and procedures of the Corporation and its
subsidiaries, Summit National Bank, Alta Mesa National Bank and Camp Bowie
National Bank (collectively referred to as the "Subsidiary Banks"), and (iii)
make recommendations to the Board as to the engagement of the independent
auditors of the Corporation.
COMPENSATION AND BENEFITS COMMITTEE
Members: Elliott S. Garsek (Chairman), Robert E. Bolen, Joe L. Bussey,
M.D. and Byron B. Searcy.
The function of the Compensation Committee is to make recommendations to
the Board with regard to the remuneration of the executive officers and
directors of the Corporation and the Subsidiary Banks. The Compensation
Committee is also responsible for the administration of the 1982 Incentive
Stock Option Plan, the 1993 Incentive Stock Option Plan, the Defined Benefit
Pension Plan, the Management Security Plan and the Incentive Compensation Plan
of the Corporation. See "EXECUTIVE COMPENSATION AND OTHER INFORMATION."
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ASSET/LIABILITY MANAGEMENT COMMITTEE
Members: Robert E. Bolen, F.S. Gunn, Jeffrey M. Harp, James L. Murray,
Philip E. Norwood and Lloyd J. Weaver.
The functions of the Asset/Liability Committee are to review the
implementation of the Corporation's asset and liability management functions
and assure that those functions are in a workable and productive fashion. The
Committee is also responsible for achieving asset and liability management
objectives while working within the range of operating guidelines set forth in
the Asset/Liability Management Policy.
DIRECTORS' COMPENSATION
During 1994 the Corporation paid each of its directors $300 for attendance
at each meeting of the Board and $100 for attendance at each committee meeting
thereof. The Corporation paid a total of $28,800 in directors' fees and $4,100
in committee fees during 1994.
During 1994 Summit National Bank paid each of its directors $300 for
attendance at a meeting of the Board of Directors of Summit National Bank and
$100 for attendance at each committee meeting thereof. Summit National Bank
paid a total of $38,100 in directors' fees and $11,250 in committee fees during
1994.
During 1994 Alta Mesa National Bank paid each of its directors $200 for
attendance at a meeting of the Board of Directors of Alta Mesa National Bank
and $50 for attendance at each committee meeting thereof. Alta Mesa National
Bank paid a total of $30,300 in directors' fees and $4,200 in committee fees
during 1994.
During 1994 Camp Bowie National Bank paid each of its directors $200 for
attendance at a meeting of the Board of Directors of Camp Bowie National Bank
and $50 for attendance at each committee meeting thereof. Camp Bowie National
Bank paid a total of $21,400 in directors' fees and $4,200 in committee fees
during 1994.
ATTENDANCE AT BOARD AND COMMITTEE MEETINGS
During 1994 there were eight (8) meetings (including regularly scheduled
and special meetings) of the Board, no meetings of the Executive Committee, two
(2) meetings of the Audit Committee, two (2) meetings of the ALCO Committee and
four (4) meetings of the Compensation Committee. Each director, except Lynn C.
Perkins, M.D., and Lloyd J. Weaver attended at least seventy-five percent (75%)
of the total number of meetings of the Board and Committees of the Board of
which he was a member during 1994.
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PROPOSAL NO. 2:
APPROVAL OF APPOINTMENT OF INDEPENDENT AUDITORS
Subject to approval by the shareholders, the Board has selected the firm
of Stovall, Grandey & Whatley, Certified Public Accountants, as independent
auditors of the Corporation for its fiscal year ending December 31, 1995.
Stovall, Grandey & Whatley has acted in such capacity for the Corporation since
1979 and has reported that neither the firm nor any of its partners has any
material direct or indirect financial interest in the Corporation, other than
as independent auditors.
Representatives of Stovall, Grandey & Whatley will be present at the
Annual Meeting of Shareholders with the opportunity to make a statement if they
desire to do so and are expected to be available to respond to appropriate
questions.
THE BOARD RECOMMENDS THAT THE SHAREHOLDERS VOTE "FOR" THE APPROVAL OF THE
APPOINTMENT OF STOVALL, GRANDEY & WHATLEY AS INDEPENDENT AUDITORS OF THE
CORPORATION.
PROPOSAL NO. 3:
AMENDMENT OF THE ARTICLES OF INCORPORATION TO DELETE
ARTICLE 14 FROM THE ARTICLES OF INCORPORATION
On February 21, 1995, the Board adopted, subject to the approval of the
shareholders, resolutions proposing an amendment to the Articles of
Incorporation of the Corporation to delete Article 14 in its entirety therefrom.
Article 14 of the Articles of Incorporation currently provides as follows:
"ARTICLE 14. ACTION BY CONSENT OF SHAREHOLDERS.
To the fullest extent permitted by law, any action required
or permitted to be taken at any annual or special meeting of the
shareholders may be taken without a meeting, without prior notice
and without a vote, if a consent or consents in writing setting
forth the action so taken shall be signed and dated by the holder
or holders of shares having not less than a minimum number of votes
that would be necessary to take such action at a meeting at which
the holders of all shares entitled to vote on the action were present
and voting."
The purpose of the deletion of Article 14 is to require that matters
involving shareholder action be taken up at a properly called meeting of
shareholders where proposals can be discussed fully with all shareholders being
entitled to appear, voice their views and vote with regard to such matters.
Additionally, management will have the opportunity to provide its input on such
matters and possibly provide all shareholders with additional information that
would be helpful in such vote.
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If the proposed amendment is approved, the Corporation intends to file the
amendment to the Articles of Incorporation with the Secretary of State of Texas
as soon as is reasonably practicable after such approval is obtained and such
amendment will be effective upon such filing. Thereafter, any action requiring
shareholder approval will require the holding of a properly called meeting of
shareholders and the taking of a vote of shareholders regarding such action.
The procedures for the calling of such a meeting, including, but not limited
to, the number of shares required to call such a meeting (see Proposal 6
below), will be governed by the Corporation's Articles of Incorporation and
Bylaws and applicable state law.
Approval of the proposed amendment to the Corporation's Articles of
Incorporation requires the affirmative vote of the holders of a majority of the
outstanding shares of Common Stock of the Corporation.
THE BOARD RECOMMENDS THAT THE SHAREHOLDERS VOTE "FOR" APPROVAL OF THE
PROPOSED AMENDMENT TO THE ARTICLES OF INCORPORATION DELETING ARTICLE 14 FROM
THE ARTICLES OF INCORPORATION.
PROPOSAL NO. 4:
AMENDMENT OF THE ARTICLES OF INCORPORATION TO DELETE
ARTICLE 15 FROM THE ARTICLES OF INCORPORATION
On February 21, 1995, the Board adopted, subject to the approval of the
shareholders, resolutions proposing an amendment to the Articles of
Incorporation of the Corporation to delete Article 15 in its entirety therefrom.
Article 15 of the Articles of Incorporation currently provides as follows:
"ARTICLE 15. MAJORITY VOTE.
A majority vote is sufficient for any action which requires the
vote or concurrence of the shareholders."
The purpose of the deletion of Article 15 is to provide for a shareholder
vote greater than a majority vote or what is sometimes referred to as "super-
majority" vote in certain instances as provided by applicable state law or by
the Corporation's Articles of Incorporation or Bylaws. For instance, absent a
provision in the Articles of Incorporation such as Article 15 as quoted above,
the Texas Business Corporation Act requires the affirmative vote of at least
two-thirds (2/3) of the outstanding shares entitled to vote to approve a number
of corporate actions including, but not limited to, the approval of (i) a plan
of merger or share exchange, (ii) the sale, lease, exchange, or other
disposition of all, or substantially all, of the property and assets of a
corporation not made in the usual and regular course of its business, and (iii)
the amendment of the Articles of Incorporation of the Corporation. Due to the
significance of matters such as these to the Corporation and its shareholders,
it is the opinion
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of the Board that it is appropriate to require more than a simple majority
vote for approval of such matters.
If the proposed amendment is approved, the Corporation intends to file the
amendment to the Articles of Incorporation with the Secretary of State of Texas
as soon as is reasonably practicable after such approval is obtained and such
amendment will be effective upon such filing. Thereafter, any matter requiring
shareholder approval shall require the vote of that number of shares as
required by the applicable state law, the Articles of Incorporation and the
Bylaws of the Corporation, which may be a majority in number or greater, rather
than having all matters requiring shareholder approval be approved upon a
majority vote of shares as provided by Article 15.
Approval of the proposed amendment to the Corporation's Articles of
Incorporation requires the affirmative vote of the holders of a majority of the
outstanding shares of Common Stock of the Corporation.
THE BOARD RECOMMENDS THAT THE SHAREHOLDERS VOTE "FOR" APPROVAL OF THE
PROPOSED AMENDMENT TO THE ARTICLES OF INCORPORATION DELETING ARTICLE 15 FROM
THE ARTICLES OF INCORPORATION.
PROPOSAL NO. 5:
AMENDMENT OF THE ARTICLES OF INCORPORATION TO INCREASE
THE NUMBER OF SHARES OF COMMON STOCK THAT THE CORPORATION
IS AUTHORIZED TO ISSUE
On February 21, 1995, the Board adopted, subject to the approval of the
shareholders, resolutions proposing an amendment to the Articles of Incorpora-
tion of the Corporation to amend Article 4 thereof. Article 4 of the Articles
of Incorporation currently provides as follows:
"ARTICLE 4. SHARES.
The aggregate number of shares which the corporation shall have
authority to issue is 8,000,000 shares with a par value of One and
25/100 Dollars ($1.25) per share. The shares are designated as Common
Stock and have identical rights and privileges in every respect."
It is proposed to amend Article 4 to read as follows:
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"ARTICLE 4. SHARES.
The aggregate number of shares which the corporation shall have
authority to issue is 20,000,000 shares of the par value of One Dollar
and 25/100 Dollars ($1.25) per share. The shares are designated as
Common Stock and have identical rights and privileges in every
respect."
The purpose of this proposed amendment is to provide sufficient
authorized shares of the Corporation's Common Stock to carry out the
requirements of the Rights Plan adopted by the Company in 1990 as well as
shares that could be utilized for possible future acquisitions, stock dividends
and stock splits. By increasing the number of authorized shares of the
Corporation's Common Stock, the Board will have increased flexibility in these
areas without incurring the additional expense and delay attendant to seeking
additional amendments to the Articles of Incorporation to authorize the
issuance of increased numbers of shares of Common Stock as they are needed.
The Corporation has no present plans to issue any shares of its Common
Stock that are currently authorized and unissued or to be authorized pursuant
to the proposed amendment. The holders of Common Stock are not entitled to any
preemptive rights.
If the proposed amendment is approved, the Corporation intends to file the
amendment to the Articles of Incorporation with the Secretary of State of Texas
as soon as is reasonably practicable after such approval is obtained and such
amendment will be effective upon such filing. The voting rights and other
rights which accompany the Corporation's Common Stock will not be altered by
the increase in authorized shares.
Approval of the proposed amendment to the Corporation's Articles of
Incorporation requires the affirmative vote of the holders of a majority of the
outstanding shares of Common Stock of the Corporation.
THE BOARD RECOMMENDS THAT THE SHAREHOLDERS VOTE "FOR" APPROVAL OF THE
PROPOSED AMENDMENT TO THE ARTICLES OF INCORPORATION AMENDING ARTICLE 4 OF THE
ARTICLES OF INCORPORATION TO INCREASE THE NUMBER OF SHARES OF COMMON STOCK THAT
THE CORPORATION IS AUTHORIZED TO ISSUE.
PROPOSAL NO. 6:
AMENDMENT OF THE ARTICLES OF INCORPORATION TO INCREASE
THE NUMBER OF SHARES REQUIRED TO CALL A SPECIAL MEETING
OF SHAREHOLDERS
On February 21, 1995, the Board adopted, subject to the approval of the
shareholders, resolutions proposing an amendment to the Articles of Incorpora-
tion of the Corporation to add the following provision thereto as the next
numbered article:
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"Article __. SPECIAL MEETINGS OF SHAREHOLDERS.
Special meetings of the shareholders, for any purpose or
purposes, unless otherwise prescribed by statute or by the
Articles of Incorporation, may be called by the President,
the Board of Directors or the holders of not less than three-
tenths (3/10) of all the shares entitled to vote at the
meetings. Business transacted at a special meeting shall be
confined to the purpose or purposes stated in the notice of
the meeting."
Article 2.24.C. of the Texas Business Corporation Act and Section 2.04 of
the Corporation's Bylaws currently provide that the number of shares required
to be held by shareholders in order to call a special meeting of shareholders
is one-tenth (1/10) of all shares entitled to vote at such meeting. If a
corporation determines to provide for a number greater than one-tenth (1/10),
such a provision must be contained in the Articles of Incorporation of the
corporation.
The purpose of amending the Articles of Incorporation as set forth above
to increase the percentage to three-tenths (3/10) instead of the current one-
tenth (1/10) is to avoid the expense and the interference with operations of
the Corporation by having to hold meetings of shareholders called by the
holders of a relatively low number of shares of the Corporation. If the matter
is of such significance that it should be called, then the Board is of the
opinion that it should be significant to a larger number of shareholders than
one-tenth (1/10).
If the proposed amendment is approved, the Corporation intends to file the
amendment to the Articles of Incorporation with the Secretary of State of Texas
as soon as is reasonably practicable after such approval is obtained and such
amendment will be effective upon such filing. Thereafter, shareholders will
not be entitled to call a special meeting of shareholders unless such
shareholders requesting the meeting hold, in the aggregate, at least
three-tenths (3/10) of the shares entitled to vote at such meeting of
shareholders.
Approval of the proposed amendment to the Corporation's Articles of
Incorporation requires the affirmative vote of the holders of a majority of
the outstanding shares of Common Stock of the Corporation.
THE BOARD RECOMMENDS THAT THE SHAREHOLDERS VOTE "FOR" APPROVAL OF THE
PROPOSED AMENDMENT TO THE ARTICLES OF INCORPORATION TO INCREASE THE NUMBER OF
SHARES REQUIRED TO CALL A SPECIAL MEETING OF SHAREHOLDERS.
ACTION TO BE TAKEN UNDER THE PROXY
The accompanying proxy will be voted "FOR" each of the above noted
Proposals unless the proxy is marked in such a manner as to withhold authority
to so vote.
-13-
The accompanying proxy will also be voted in connection with the
transaction of such other business as may properly come before the Annual
Meeting of Shareholders, or any adjournment or adjournments thereof.
Management knows of no other matters to be considered at the Annual Meeting of
Shareholders. If, however, any other matters properly come before the Annual
Meeting of Shareholders, or any adjournment or adjournments thereof, the
persons named in the accompanying proxy will vote such proxy in accordance with
their best judgment on any such matter. The persons named in the accompanying
proxy will also, if in their judgment it is deemed to be advisable, vote to
adjourn the meeting from time to time.
STOCK OWNERSHIP OF CERTAIN BENEFICIAL
OWNERS AND MANAGEMENT
By Management
The following table shows beneficial ownership of shares of Common Stock
of the Corporation by all current directors, nominees for director, and
executive officers of the Corporation named under the caption "EXECUTIVE
COMPENSATION AND OTHER INFORMATION," individually, and, together with all
current executive officers of the Corporation, as a group, at December 31, 1994.
Amount and
Name of Beneficial Nature of Percent
Owner or Number Beneficial of
of Persons in Group Ownership(1) Class(2)
Philip E. Norwood 55,128 shares(3) 3.3%
James L. Murray 69,614 shares(4) 4.1%
F. S. Gunn 90,233 shares(5) 5.3%
Jeffrey M. Harp 41,970 shares(6) 2.5%
Robert E. Bolen 4,988 shares *
Joe L. Bussey, M.D. 26,816 shares(7) 1.6%
Elliott S. Garsek 5,000 shares *
Ronald J. Goldman 66,078 shares(8) 3.9%
William W. Meadows 3,300 shares *
Edward P. Munson 6,202 shares(9) *
Lynn C. Perkins, M.D. 3,806 shares *
Byron B. Searcy 18,450 shares(10) 1.1%
Lloyd J. Weaver 7,694 shares *
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All directors and
executive officers as
a group (13 persons) 399,279 shares(11) 23.6%
* Less than one percent (1%) of all of the issued and outstanding shares of
Common Stock.
(1) Based on information furnished by persons named and, except as otherwise
indicated below, each person has sole voting power and investment power with
respect to all shares of Common Stock owned by such person.
(2) Based on 1,578,723 shares of Common Stock issued and outstanding as of
December 31, 1994, as adjusted for shares convertible or exercisable within
sixty (60) days of December 31, 1994 which are deemed outstanding for a
specific shareholder pursuant to Rule 13d-3(d)(1) under the Securities Exchange
Act of 1934.
(3) Includes 12,384 shares of Common Stock owned of record; 744 shares of
Common Stock owned by Mr. Norwood's children; and 42,000 shares of Common Stock
which Mr. Norwood has the right to acquire within sixty (60) days of
December 31, 1994 pursuant to options granted to him under the 1982 Stock Plan
and the 1993 Stock Plan. See "EXECUTIVE COMPENSATION AND OTHER INFORMATION -
Option Exercises and Holdings."
(4) Includes 40,614 shares of Common Stock owned of record and 29,000 shares
of Common Stock which Mr. Murray has the right to acquire within sixty (60)
days of December 31, 1994 pursuant to options granted to him under the 1982
Stock Plan and the 1993 Stock Plan. See "EXECUTIVE COMPENSATION AND OTHER
INFORMATION - Option Exercises and Holdings."
(5) Includes 70,201 shares of Common Stock owned of record; and 20,032 shares
of Common Stock held by a trust for which Mr. Gunn serves as a co-trustee.
(6) Includes 12,306 shares of Common Stock owned of record and 29,664 shares
of Common Stock which Mr. Harp has the right to acquire within sixty (60) days
of December 31, 1994 pursuant to options granted to him under the 1982 Stock
Plan and the 1993 Stock Plan. See "EXECUTIVE COMPENSATION AND OTHER
INFORMATION - Option Exercises and Holdings."
(7) Includes 20,816 shares of Common Stock owned of record and 6,000 shares of
Common Stock held by Mr. Bussey's IRA.
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(8) Includes 66,076 shares of Common Stock owned of record and two (2) shares
of Common Stock owned by Mr. Goldman's son.
(9) Includes 4,694 shares of Common Stock owned of record and 1,508 shares of
Common Stock owned by Mr. Munson's wife.
(10) Includes 18,140 shares of Common Stock owned of record and 310 shares of
Common Stock owned by Mr. Searcy's wife.
(11) Includes 100,664 shares of Common Stock with respect to which certain
named executive officers of the Corporation have the right to acquire
beneficial ownership within sixty (60) days of December 31, 1994 pursuant to
options granted to them under the 1982 Stock Plan and the 1993 Stock Plan. See
"EXECUTIVE COMPENSATION AND OTHER INFORMATION - Option Exercises and Holdings."
By Others
The following table sets forth certain information with respect to
shareholders of the Corporation who were known to be beneficial owners of more
than five percent (5%) of the outstanding shares of Common Stock as of December
31, 1994.
AMOUNT AND NATURE
NAME AND ADDRESS OF OF BENEFICIAL PERCENT OF
BENEFICIAL OWNER OWNERSHIP (1) CLASS
F. S. Gunn 90,233(2) 5.3%
1300 Summit Avenue
Fort Worth, TX 76102
(1) Based on information furnished by the person named and, except as
otherwise indicated below, such person has sole voting power with respect to
all shares of Common Stock owned by such person.
(2) See footnote (5) under "STOCK OWNERSHIP - By Management."
Compliance with Section 16(a) of the Securities Exchange Act of 1934
Section 16(a) of the Securities Exchange Act of 1934 requires the
Corporation's executive officers, directors, and persons who own more than ten
percent (10%) of a registered class of the Corporation's equity securities to
file reports of ownership with the Securities and Exchange Commission.
Based upon a review of Forms 3, 4 and 5 and amendments thereto furnished
to the Corporation, management of the Corporation has determined that during
1994 no directors, officers or ten percent (10%) beneficial shareholders of
Common Stock of the Corporation
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failed to timely file with the Securities and Exchange Commission one or more
required reports on Form 3, 4 or 5 regarding transactions in securities of the
Corporation.
To the best knowledge of management of the Corporation, during 1994 no
director, officer or ten percent (10%) beneficial shareholder of Common Stock
of the Corporation failed to file with the Securities and Exchange Commission
any required reports on Form 3, 4 or 5 regarding transactions in securities of
the Corporation.
EXECUTIVE COMPENSATION AND OTHER INFORMATION
Summary of Cash and Certain Other Compensation
The following table provides certain summary information concerning
compensation paid or accrued by the Corporation and its subsidiaries, to or on
behalf of the Corporation's Chief Executive Officer and each of the three other
most highly compensated executive officers of the Corporation (determined as of
the end of the last fiscal year)(hereinafter referred to as the "named
executive officers") for the fiscal years ended December 31, 1992, 1993 and
1994:
SUMMARY COMPENSATION TABLE
Annual Compensation All Other
Salary Bonus Compensation
Name and Principal Position Year ($)(1) ($)(2) ($)(3)
Philip E. Norwood 1994 $168,050 $30,000(4) $2,604(5)
President and Chief Executive 1993 $164,650 $2,446(6)
Officer of the Corporation; 1992 $128,800 $2,134(7)
Chairman Board and Chief
Executive Officer of Alta Mesa
National Bank; President of
Camp Bowie National Bank
James L. Murray 1994 $152,480 $15,000(8) $1,404
Chairman of the Board of the 1993 $149,750 $1,193
Corporation; Chairman of the 1992 $128,800 $ 955
Board of Camp Bowie National
Bank
F. S. Gunn 1994 $137,260 $1,404
Vice Chairman of the Board of 1993 $134,250 $ 983
the Corporation; Chairman of the 1992 $128,950 $ 612
Board of Summit National Bank
Jeffrey M. Harp 1994 $167,950 $30,000(9) $ 348
Chief Operating Officer, 1993 $164,750 $ 348
Executive Vice President, 1992 $128,950 $ 139
Secretary and Treasurer of the
Corporation; President of Summit
National Bank
(1) Includes salary and directors' fees.
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(2) The bonus amounts were paid pursuant to the Corporation's Incentive
Compensation Plan. (See detailed discussion beginning on page 23 of this Proxy
Statement under "Board Compensation Committee Report on Executive
Compensation").
(3) Except as otherwise noted, "All Other Compensation" consists of premium
payments with respect to term life insurance for the benefit of the named
executive officer.
(4) Consists of a bonus from the Corporation in the amount of $30,000.
(5) Consists of premium payments with respect to term life insurance for the
benefit of the named executive officer in the amount of $342 and premium
payments with respect to dependent health coverage for the benefit of the named
executive officer in the amount of $1,896.
(6) Consists of premium payments with respect to term life insurance for the
benefit of the named executive officer in the amount of $139 and premium
payments with respect to dependent health coverage for the benefit of the named
executive officer in the amount of $2,307.
(7) Consists of premium payments with respect to term life insurance for the
benefit of the named executive officer in the amount of $204 and premium
payments with respect to dependent health coverage for the benefit of the named
executive officer in the amount of $1,930.
(8) Consists of a bonus from Camp Bowie National Bank.
(9) Consists of a bonus from the Corporation in the amount of $7,500 and a
bonus from Summit National Bank in the amount of $22,500.
Option Exercises and Holdings
The following table provides information with respect to the named
executive officers concerning the exercise of incentive stock options during
the last fiscal year and unexercised incentive stock options held as of the end
of the last fiscal year:
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AGGREGATED OPTION EXERCISES
IN LAST FISCAL YEAR
AND FY-END OPTION VALUES
Shares
Acquired on Value
Name Exercise(#) Realized(1)
Philip E. Norwood 2,000 $31,500
James L. Murray -0- -0-
F.S. Gunn 29,000 $460,530
Jeffrey M. Harp 6,800 $98,600
(TABLE CONTINUED)
Value of
Number of Unexercised
Unexercised In-the-Money
Options at Options at
FY-End(#) FY-End($)
Exercisable/ Exercisable/
Name Unexercisable Unexercisable(2)
Philip E. Norwood 21,000/-0-(3) $341,250/$-0-
16,664/3,336(4) $133,312/$26,688
James L. Murray 23,000/-0-(3) $373,750/$-0-
6,000/-0-(4) $ 48,000/$-0-
F.S. Gunn -0-/-0- $ -0- /$-0-
-0-/-0- $ -0- /$-0-
Jeffrey M. Harp 13,000/-0-(3) $211,250/$-0-
16,664/3,336(4) $133,312/$26,688
(1) Market value of underlying securities at exercise, minus the exercise or
base price.
(2) Market value of underlying securities as of the fiscal year-end ($20.00),
minus the exercise or base price.
(3) These options are exercisable at $3.75 per share.
(4) These options are exercisable at $12.00 per share.
Pension Plan
The following table shows the estimated annual pension benefits payable to
a participant in the Corporation's qualified defined benefit pension plan (the
"Pension Plan") at normal retirement age (age 65), based on a participant's
compensation that is covered under the Pension Plan, and years of service with
the Corporation and its subsidiaries:
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ANNUAL BENEFITS* FOR YEARS OF CREDITED SERVICE
Remuneration 10 15 20 25 30 35
$ 90,000 $12,906 $19,359 $25,812 $32,265 $38,718 $45,171
$100,000 $14,756 $22,134 $29,512 $36,890 $44,268 $51,646
$120,000 $18,456 $27,684 $36,912 $46,140 $55,368 $64,596
$130,000 $20,306 $30,459 $40,612 $50,765 $60,918 $71,071
$150,000 $24,006 $36,009 $48,012 $60,015 $72,018 $84,021
* Retirement benefits are subject to reduction for subsequent changes in the
federal social security benefit levels or taxable wage base, and are further
limited by a maximum of thirty-five (35) years of credited service.
A participant's compensation for purposes of the formula utilized by the
Pension Plan consists of salary, bonus, and all other compensation reported in
the Summary Compensation Table, as well as certain other personal benefits
which, in the aggregate, do not exceed the minimum amounts required for
disclosure thereunder.
The Pension Plan also provides that upon a participant's termination of
employment or retirement certain benefits may be paid under the Pension Plan in
a lump sum cash payment. If a participant's benefits, determined as of the
date of termination of employment or retirement, are not more than $3,500, the
Compensation Committee may direct, without the consent of the participant or
his spouse, if any, that the benefits be paid in a lump sum cash payment in
lieu of any other Pension Plan benefits. If a participant's benefits exceed
$3,500, a lump sum payment to the participant shall require his written consent
and the written consent of his spouse, if any. Any such lump sum payment must
be approved by the Compensation Committee.
Annual compensation covered under the Pension Plan and credited years of
service as of December 31, 1994 for the named executive officers are as
follows: Philip E. Norwood, $201,816 (14 years); James L. Murray, $171,633
(20 years); F.S. Gunn, $140,121 (20 years); and Jeffrey M. Harp, $200,694
(10 years).
Termination of Employment and Change in Control Arrangements
Effective September 1, 1992 the Board adopted the Management Security Plan
of Summit Bancshares, Inc. (the "Security Plan"). The purpose of the Security
Plan is to provide specified benefits to a select group of management and
highly compensated employees who contribute materially to the continued growth,
development and future business success of the Corporation and the Subsidiary
Banks. The Security Plan, and the individual agreements established thereunder
(each a "Security Plan Agreement"), are intended to be administered by the
Compensation Committee as unfunded welfare benefit plans established and
maintained for the participants.
-20-
Under the Security Plan, if a participant remains an employee until his or
her normal retirement date, the Corporation shall pay to the participant a
retirement benefit in the amount specified in the participant's Security Plan
Agreement (the "Retirement Benefit"). Payment of the Retirement Benefit under
the Security Plan shall begin on the normal retirement date and will continue
for one hundred eighty (180) months. If a participant continues employment
beyond his or her normal retirement date, the Compensation Committee shall
specify the amount of the Retirement Benefit due to the participant, which
shall not be less than the Retirement Benefit such participant would otherwise
have received had the participant retired at normal retirement age.
Under the Security Plan, if a participant dies prior to attaining normal
retirement age and the Security Plan is in effect at that time, the Corporation
will pay a death benefit to such participant's beneficiary, provided the
participant was not retired, disabled or on an authorized leave of absence at
the time of death (the "Death Benefit").
The Death Benefit is a sum equal to one hundred percent (100%) of the
participant's covered salary, an amount specified in the Security Plan
Agreement, paid monthly for the first twelve (12) months after death, and fifty
percent (50%) of the covered salary for the next one hundred eight (108)
months. The payments commence on the first day of the month following the date
of death.
If a participant dies after retirement but before the applicable
Retirement Benefit is paid in full, the unpaid Retirement Benefit payments to
which that participant is entitled shall continue and be paid to the
participant's beneficiary. No Death Benefit will be paid to the beneficiary of
a participant who dies after attaining normal retirement age.
A participant who ceases to be an employee after enrollment in the
Security Plan, unless such termination is for just cause (defined in the
Security Plan as theft, fraud, embezzlement or willful misconduct causing
significant property damage to the Corporation or personal injury to another
employee), shall receive the Retirement Benefit provided in the Security Plan
upon the earlier of the participant's death or attainment of normal retirement
age (the "Deferred Termination Benefit").
A Security Plan Agreement may be terminated by the participant upon
written notice not less than thirty (30) days prior to an anniversary date of
the date of execution of the Participant's Security Plan Agreement. In such
case a participant's entitlement to receive the Death Benefit will cease, but
the participant will still be entitled to receive the Deferred Termination
Benefit. The Security Plan may be terminated by the Corporation at any time
provided thirty (30) days notice is given to the participant and provided no
payment of benefits has been commenced and not completed.
In the event the Corporation undergoes a change of control, as defined in
the Security Plan, and the surviving corporation takes action to terminate the
Security Plan or a specific Security Plan Agreement as a result of the change
in control, the participant will, nevertheless, be entitled to receive the
Retirement Benefit, the Death Benefit, and the Deferred Termination Benefit
as described in the Security Plan.
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The Corporation has entered into Security Plan Agreements with James L.
Murray, Chairman of the Board of the Corporation, and F. S. Gunn, Vice Chairman
of Board of the Corporation, dated September 1, 1992. These agreements provide
Death Benefits of $9,833.33 per month for the first twelve (12) months and
$4,916.67 per month for the next one hundred eight (108) months for Mr. Murray
and Mr. Gunn, and Retirement Benefits (in the event of retirement at normal
age) of $4,000 per month each for one hundred eighty (180) months for Mr.
Murray and Mr. Gunn.
Amounts payable under the Security Plan shall be paid exclusively from the
general assets of the employer. However, under the Security Plan, the
Corporation may invest in any specific asset or fund in order to provide the
means for the payment of any benefits under the Security Plan. Security Plan
participants will have no interest whatsoever in any such fund or asset. The
Corporation has purchased life insurance policies insuring the lives of Mr.
Murray and Mr. Gunn in the face amounts of $700,311 and $649,591, respectively,
with the Corporation as owner, premium payor and beneficiary of each policy, in
order to indemnify itself against the liability for the payment of any benefits
under the Security Plan.
The Compensation Committee is currently considering other participants
for inclusion in the Security Plan. Specific individuals to be included and
the terms of respective Security Plan Agreements for other participants have
not been determined.
Compensation Committee Interlocks and Insider Participation
Elliott S. Garsek served as Chairman of the Compensation Committee during
1994. Mr. Garsek is a partner of Barlow & Garsek, a Professional Corporation.
During 1994 the Corporation, Camp Bowie National Bank and Alta Mesa National
Bank retained Barlow & Garsek to perform legal services on behalf of each.
Board Compensation Committee Report on Executive Compensation
The Compensation Committee (the "Committee") is comprised of the following
four non-employee members of the Board: Elliott S. Garsek (Chairman), Robert
E. Bolen, Joe L. Bussey, M.D. and Byron B. Searcy. Among other duties, the
Committee makes recommendations to the Board with regard to the remuneration of
the executive officers and directors of the Corporation and the Subsidiary
Banks.
A consulting firm specializing in compensation and benefits was engaged
by the Corporation in 1993 and 1994 to help establish the base pay and
incentive compensation of the executive officers of the Corporation and the
Subsidiary Banks.
The executive officers of the Corporation receive their base pay salary
from the Corporation or the Subsidiary Banks for services rendered in various
capacities to those entities. The consulting firm utilized local and national
bank peer group surveys of salaries of individuals in positions comparable to
those of the executive officers of the Corporation to make base pay salary
range recommendations to the Committee, which in turn made
-22-
such recommendations to the Boards' of Directors of the Corporation and
Subsidiary Banks (the "Subsidiary Boards"). Base pay salaries were then
established for the executive officers by the appropriate board within the
ranges recommended by the consulting firm and the Committee. Such base pay
salaries will be reviewed annually by the Committee, the Board and the
Subsidiary Boards. The philosophy of the Committee, the Board and the
Subsidiary Boards is for future adjustments to base pay salaries to be based
upon increases in cost of living and changes in responsibilities, with any
additional compensation tied to actual performance of the Corporation, as
described below.
In 1993 the Board approved an Incentive Compensation Plan (the "Plan"),
which is designed to provide objective standards to compensate executive
officers of the Corporation (in their capacities as both executive officers of
the Corporation and the Subsidiary Banks) in an equitable and competitive
manner, considering differences between job responsibilities and organizational
unit maturity, market size, funding methods, and investment opportunities. The
Plan was in effect for the year ended December 31, 1994, and any incentive
compensation earned will be paid in 1995. The Plan will be used to reward
executive officers of the Corporation for performance that exceeds the stated
criteria.
Under the Plan, executive officers of the Corporation will recommend
performance goals for each criteria and a weight factor based upon the emphasis
placed on the individual criteria. The Board must approve the performance
goals and the weight factors. At the end of each year, results are accumulated
and graded by an outside consultant on a scale of 80 to 120, with such grading
to serve as a recommendation to the Board, which will make final decisions on
all grades. Incentives may only be earned if grades above 95 are earned. Such
incentives will allow executive officers to earn from 5% to 25% of their annual
base salary as additional compensation, depending on the grades achieved.
Mr. Norwood serves as the chief executive officer of the Corporation, as
the chief executive officer of Alta Mesa National Bank and from July 1994
served as President of Camp Bowie National Bank. Mr. Harp serves as both the
chief operating officer of the Corporation and as the chief executive officer
of Summit National Bank. Both individuals participate in the Plan in those
capacities. As a result of such participation, such executive officers may
potentially earn additional compensation of up to 50% of base salary for
superior performance.
The criteria selected to evaluate 1994 performance included return on
assets, net interest margin, asset quality, operating expense management and
shareholder return, with each criteria measured against the Plan, as well as
selected peer group comparisons. In order to achieve the maximum incentive,
participants under the Plan must grade 120 in all performance criteria
selected. The Committee also evaluates non-objective performance criteria such
as execution of business strategies, organizational development and
introduction of new technologies, products and services.
Mr. Norwood's 1994 base salary was established by the Board of the
Corporation based on the mid-point range determined by the consulting firm and
recommended to the Board by the Committee, which is targeted to be in the 50th
percentile of the Corporation's
-23-
peer group. Neither Mr. Norwood's nor any other executive officer's 1994
incentive compensation, if any, has been determined. The final evaluation will
be completed after the appropriate peer group data for 1994 is available.
In February 1993 the Board adopted the 1993 Incentive Stock Option Plan of
Summit Bancshares, Inc. (the "Stock Plan"). The Stock Plan was ratified by the
shareholders of the Corporation at the 1993 annual meeting. It is the
Corporation's philosophy that awarding incentive stock options to officers of
the Corporation and the Subsidiary Banks based upon their respective positions
and contributions to the Corporation's and each Subsidiary Bank's overall
success will help attract and retain a high quality of results-oriented
professionals committed to creating long term shareholder value.
In April 1993 the Committee granted options to the executive officers of
the Corporation and the Subsidiary Banks under the Stock Plan. Mr. Norwood was
granted an option to purchase 20,000 shares at a price of $12.00 per share with
8,333 shares vested at the time of grant, 8,333 shares vesting in April 1994
and 3,334 shares vesting in April 1995. The Committee based its decision on
the Corporation's improved performance, including net income, return on assets,
reduction in classified and non-performing assets and improved expense control.
Through the programs described above, a significant portion of the
Corporation's executive compensation program is linked directly to individual
and corporate performance and long-term shareholder return. The Committee will
continue to review all elements of executive compensation to ensure that the
total compensation program, and each element therein, meets the Corporation's
objectives and philosophy, as discussed above.
THE COMPENSATION COMMITTEE
OF THE BOARD OF DIRECTORS
Elliott S. Garsek, Chairman
Robert E. Bolen
Joe L. Bussey, M.D.
Byron B. Searcy
Performance Graph
The following graph compares the cumulative total stockholder return on
the Common Stock of the Corporation with that of the CRSP Total Return Index
for The Nasdaq Stock Market (US) Index, a broad market index published by the
Center for Research in Security Prices at the University of Chicago, and the
NASDAQ Bank Stocks Index, a bank industry stock index also published by the
Center for Research in Security Prices at the University of Chicago. The
comparison for each of the periods assumes that $100 was invested on
December 31, 1989 in each of the Common Stock of the Corporation, the stocks
included in the CRSP Total Return Index for The NASDAQ Stock Market (US) Index
and the NASDAQ Bank Stocks Index. These indexes, which reflect
-24-
formulas for dividend reinvestment and weighing of individual stocks, do not
necessarily reflect returns that could be achieved by individual investors.
COMPARISON OF FIVE-YEAR CUMULATIVE TOTAL RETURN
AMONG THE CORPORATION, THE CRSP TOTAL RETURN INDEX
FOR THE NASDAQ STOCK MARKET (US) INDEX,
AND THE NASDAQ BANK STOCKS INDEX
(Linear Graph Plotted from Points in Table Below)
1989 1990 1991 1992 1993 1994
Corporation $100.00 $94.12 $ 88.24 $129.41 $434.47 $484.12
Total Return $100.00 $84.92 $136.28 $158.58 $180.93 $176.92
Bank Stocks $100.00 $73.23 $120.17 $174.87 $199.33 $198.69
-25-
CERTAIN TRANSACTIONS
Loans
Certain of the officers, directors and principal shareholders (and their
affiliates) of the Corporation and the Subsidiary Banks have deposit accounts
and other transactions with the Subsidiary Banks, including loans in the
ordinary course of business. All loans or other extensions of credit made by
the Subsidiary Banks to officers, directors and principal shareholders of the
Corporation and the Subsidiary Banks, and to affiliates of such persons, were
made in the ordinary course of business on substantially the same terms,
including interest rates and collateral, as those prevailing at the time for
comparable transactions with independent third parties and did not involve more
than the normal risks of collectibility or present other unfavorable features.
The Subsidiary Banks expect to continue to enter into such transactions in
the ordinary course of business on similar terms with officers, directors and
principal shareholders (and their affiliates) of the Corporation and the
Subsidiary Banks.
Other Transactions
During the year ended 1994 the Corporation, Camp Bowie National Bank and
Alta Mesa National Bank retained Barlow & Garsek, a Professional Corporation,
to perform legal services on behalf of each. Elliott S. Garsek, a director of
the Corporation, is a partner of Barlow & Garsek.
DATE OF RECEIPT OF SHAREHOLDER PROPOSALS
Proposals of shareholders intended to be presented at the next Annual
Meeting of Shareholders must be received by the Corporation at its principal
executive offices not later than December 4, 1995 for inclusion in the
Corporation's Proxy Statement and accompanying proxy relating to the next
Annual Meeting of Shareholders. It is anticipated that the next Annual Meeting
of Shareholders will be held on April 16, 1996.
ANNUAL REPORTS
Form 10-K. A copy of the Corporation's 1994 Annual Report on Form 10-K,
including the financial statements and schedules thereto, required to be filed
with the Securities and Exchange Commission, may be obtained without charge
(except for exhibits to such Annual Report, which will be furnished upon
payment of the Corporation's reasonable expenses in furnishing such exhibits)
by any shareholder whose proxy is solicited upon written request to:
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Summit Bancshares, Inc.
P.O. Box 2665
Fort Worth, Texas 76113
Attention: Mr. Bob G. Scott
1994 Annual Report to Shareholders. The Annual Report to Shareholders
of the Corporation for the Fiscal Year ended December 31, 1994, is enclosed
herewith. The Annual Report, which includes audited financial statements, does
not form any part of the material for the solicitation of Proxies.
BY ORDER OF THE BOARD OF DIRECTORS
Philip E. Norwood, President
Fort Worth, Texas
March ___, 1995
-27-
SUMMIT BANCSHARES, INC.
Proxy Solicited on Behalf of the Board of Directors of the Corporation
For Annual Meeting of Shareholders
April 18, 1995
The undersigned hereby constitutes and appoints James L. Murray, F.S. Gunn
and Jeffrey M. Harp, and each of them, proxies with full power of substitution
to vote, as directed below, all the shares of Common Stock of Summit
Bancshares, Inc. (the "Corporation") held of record by the undersigned at the
close of business on March 17, 1995, at the Annual Meeting of Shareholders to
be held at Summit National Bank, 1300 Summit Avenue, Fort Worth, Texas, at
4:30 p.m. on April 18, 1995, and at any adjournment or adjournments thereof.
1. ELECTION OF DIRECTORS - Nominees: Robert E. Bolen, Joe L. Bussey, M.D.
Elliott S. Garsek, Ronald J. Goldman, F.S. Gunn, Jeffrey M. Harp,
William W. Meadows, Edward P. Munson, James L. Murray, Philip E.
Norwood, Lynn C. Perkins, M.D., Byron B. Searcy and Lloyd J. Weaver
MARK ONLY ONE BOX [] VOTE FOR all nominees listed above,
except vote to be withheld from the
following nominees, if any:
[] VOTE TO BE WITHHELD from all nominees
2. APPROVAL OF APPOINTMENT OF INDEPENDENT AUDITORS. Proposal to approve
the appointment of Stovall, Grandey & Whatley as independent auditors
of the Corporation for the fiscal year ending December 31, 1995, as
described in PROPOSAL NO. 2 of the Proxy Statement dated March __,
1995.
FOR ____ AGAINST ____ ABSTAIN ____
3. AMENDMENT OF ARTICLE 4 OF ARTICLES OF INCORPORATION. Proposal to
amend Article 4 of the Corporation's Articles of Incorporation to
increase the number of authorized shares of common stock of the
Corporation from 8,000,000 to 20,000,000 shares, as described in
PROPOSAL NO. 3 of the Proxy Statement dated March __, 1995.
FOR ____ AGAINST ____ ABSTAIN ____
4. AMENDMENT OF ARTICLES OF INCORPORATION TO DELETE ARTICLE 14. Proposal
to amend the Corporation's Articles of Incorporation to delete Article
14 thereof in its entirety, as described in PROPOSAL NO. 4 of the
Proxy Statement dated March __, 1995.
FOR ____ AGAINST ____ ABSTAIN ____
5. AMENDMENT OF ARTICLES OF INCORPORATION TO DELETE ARTICLE 15. Proposal
to amend the Corporation's Articles of Incorporation to delete Article
15 thereof in its entirety, as described in PROPOSAL NO. 5 of the
Proxy Statement dated March __, 1995.
FOR ____ AGAINST ____ ABSTAIN ____
6. AMENDMENT OF ARTICLES OF INCORPORATION TO ADD NEW ARTICLE. Proposal
to amend the Corporation's Articles of Incorporation to add thereto a
new Article to provide that special meetings of the shareholders, for
any purpose or purposes, unless otherwise prescribed by statute or by
the Articles of Incorporation, may be called by the President, Board
of Directors, or the holders of not less than three-tenths (3/10) of
all shares entitled to vote at the meetings, as described in PROPOSAL
NO. 6 of the Proxy Statement dated March __, 1995.
FOR ____ AGAINST ____ ABSTAIN ____
7. OTHER BUSINESS. In their discretion upon such other business as may
properly come before the meeting, or any adjournment or adjournments
thereof, as described in PROPOSAL NO. 7 of the Proxy Statement dated
March __, 1995.
FOR ____ AGAINST ____ ABSTAIN ____
THIS PROXY, WHEN PROPERLY EXECUTED AND RETURNED, WILL BE VOTED AS DIRECTED
HEREIN BY THE UNDERSIGNED STOCKHOLDER. IF NO DIRECTION IS MADE, THIS PROXY
WILL BE VOTED "FOR" ALL THE NOMINEES LISTED ABOVE, "FOR" PROPOSAL NOS. 2,
3, 4, 5, AND 6, AND, IN THE DISCRETION OF THE PERSON DESIGNATED HEREIN AS
PROXIES, UPON SUCH OTHER BUSINESS AS MAY COME BEFORE THE MEETING AND ANY
ADJOURNMENT OR ADJOURNMENTS THEREOF. The undersigned hereby revokes any
proxy or proxies heretofore given and hereby confirms all that said
attorneys and proxies, or any of the, or their substitutes may do by virtue
hereof. In addition, receipt of the 1994 Annual Report, the Notice of
Annual Meeting and the Proxy Statement of Summit Bancshares, Inc. dated
April __, 1995, is hereby acknowledged.
SHARES OF COMMON STOCK:____________ DATED: _____________________, 1995.
____________________________________
____________________________________
____________________________________
Signature of Shareholder(s)
____________________________________
Street Address
____________________________________
City State Zip Code
Please date this proxy and sign your name
exactly as it appears hereon, and mail today.
Where there is more than one owner, each
should sign. When signing as an attorney,
administrator, executor, guardian, or
trustee, please add your title as such.
If executed by a corporation, this proxy
should be signed by a duly authorized officer.
NOTE: I _____ WILL _____ WILL NOT ATTEND THE SHAREHOLDERS MEETING ON APRIL 18,
1995.
