<PAGE>
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the Securities
Exchange Act of 1934 (Amendment No. __)
Filed by the Registrant [X]
Filed by a Party other than the Registrant [_]
Check the appropriate box:
[_] Preliminary Proxy Statement [_] Confidential, for Use of the
[X] Definitive Proxy Statement Commission Only (as permitted
[_] Definitive Additional Materials by Rule 14a-6(e)(2))
[_] Soliciting Material Pursuant to Rule 14a-11(c) or Rule 14a-12
THE PEOPLES BANCTRUST COMPANY, INC
------------------------------------------------
(Name of Registrant as Specified in its Charter)
------------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
[X] No fee required.
[_] Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and 0-11.
1. Title of each class of securities to which transaction applies:
---------------------------------------------------------------------
2. Aggregate number of securities to which transaction applies:
---------------------------------------------------------------------
3. Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (set forth the amount on which the
filing fee is calculated and state how it was determined):
---------------------------------------------------------------------
4. Proposed maximum aggregate value of transaction:
---------------------------------------------------------------------
5. Total fee Paid:
---------------------------------------------------------------------
[_] Fee paid previously with preliminary materials:
[_] Check box if any part of the fee is offset as provided by Exchange Act Rule
0-11(a)(2) and identify the filing for which the offsetting fee was paid
previously. Identify the previous filing by registration statement number,
or the Form or Schedule and the date of its filing.
1. Amount previously paid:
---------------------------------------------------------------------------
2. Form, Schedule or Registration Statement No.:
---------------------------------------------------------------------------
3. Filing Party:
---------------------------------------------------------------------------
4. Date Filed:
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<PAGE>
THE PEOPLES BANCTRUST COMPANY, INC.
310 BROAD STREET
SELMA, ALABAMA 36701
(334) 875-1000
March 20, 1998
Dear Shareholder:
We invite you to attend the 1998 Annual Meeting of the Shareholders of
The Peoples BancTrust Company, Inc. to be held at the main office of The Peoples
Bank and Trust Company, 310 Broad Street, Selma, Alabama on Tuesday, April 14,
1998 at 5:00 p.m.
The enclosed Notice of Annual Meeting and Proxy Statement describe the
formal business to be transacted at the Annual Meeting. Also enclosed is the
Annual Report showing the results of 1997.
YOUR VOTE IS IMPORTANT. On behalf of the Board of Directors, we urge
-----------------------
you to sign, date and return the enclosed proxy as soon as possible, even if you
currently plan to attend the Annual Meeting. This will not prevent you from
voting in person, but will assure that your vote is counted if you are unable to
attend the Annual Meeting.
If you have any questions, please call the Company's Secretary, M.
Scott Patterson, or me at (334) 875-1000.
Thank you for your cooperation and continuing support.
Sincerely,
/s/ Richard P. Morthland
Richard P. Morthland
Chairman of the Board
and Chief Executive Officer
<PAGE>
THE PEOPLES BANCTRUST COMPANY, INC.
310 BROAD STREET
SELMA, ALABAMA 36701
(334) 875-1000
- --------------------------------------------------------------------------------
NOTICE OF ANNUAL MEETING OF THE SHAREHOLDERS
TO BE HELD ON APRIL 14, 1998
- --------------------------------------------------------------------------------
NOTICE IS HEREBY GIVEN that the 1998 annual meeting of the shareholders
(the "Annual Meeting") of The Peoples BancTrust Company, Inc. (the "Company")
will be held on Tuesday, April 14, 1998 at 5:00 p.m., local time, at the main
office of The Peoples Bank and Trust Company, 310 Broad Street, Selma, Alabama
for the following purposes:
(1) To elect twelve directors of the Company to serve until the next
annual meeting of the shareholders; and
(2) To transact other business as may properly come before the Annual
Meeting or any adjournments thereof.
Pursuant to the Bylaws, the Board of Directors has fixed the close of
business on March 12, 1998 as the record date for the determination of
shareholders entitled to notice of and to vote at the Annual Meeting. Only
holders of Common Stock of record at the close of business on that date will be
entitled to notice of and to vote at the Annual Meeting or any adjournments
thereof.
In the event that there are not sufficient votes to approve any one or more
of the foregoing proposals at the time of the Annual Meeting, the Annual Meeting
may be adjourned in order to permit further solicitation of proxies by the
Company.
You are requested to fill in and sign the enclosed form of proxy which is
solicited by the Board of Directors and mail it in the enclosed envelope. The
proxy will not be used if you attend and choose to vote in person at the Annual
Meeting.
By Order of the Board of Directors
/s/ M. Scott Patterson
M. Scott Patterson
Secretary
Selma, Alabama
March 20, 1998
- -------------------------------------------------------------------------------
IT IS IMPORTANT THAT PROXIES BE RETURNED PROMPTLY. THEREFORE, WHETHER OR NOT
YOU PLAN TO BE PRESENT IN PERSON AT THE ANNUAL MEETING, PLEASE SIGN, DATE, AND
COMPLETE THE ENCLOSED PROXY AND RETURN IT IN THE ENCLOSED ENVELOPE THAT REQUIRES
NO POSTAGE IF MAILED IN THE UNITED STATES.
- --------------------------------------------------------------------------------
<PAGE>
THE PEOPLES BANCTRUST COMPANY, INC.
310 BROAD STREET
SELMA, ALABAMA 36701
(334) 875-1000
----------------------
PROXY STATEMENT
ANNUAL MEETING OF THE SHAREHOLDERS
APRIL 14, 1998
-------------------
SOLICITATION, VOTING AND REVOCABILITY OF PROXIES
This Proxy Statement is furnished to shareholders of The Peoples
BancTrust Company, Inc. ("Peoples" or the "Company") in connection with the
solicitation by the Board of Directors of Peoples of proxies to be used at the
annual meeting of the shareholders (the "Annual Meeting"), to be held on
Tuesday, April 14, 1998 at 5:00 p.m., local time, at the main office of The
Peoples Bank and Trust Company (the "Bank"), 310 Broad Street, Selma, Alabama
and at any adjournments thereof. It is anticipated that this Proxy Statement
will be mailed to shareholders on or about March 20, 1998.
If the enclosed form of proxy is properly executed and returned to the
Company in time to be voted at the Annual Meeting, the shares represented
thereby will be voted in accordance with the instructions marked thereon.
EXECUTED BUT UNMARKED PROXIES WILL BE VOTED FOR THE PROPOSAL TO ELECT TWELVE
NOMINEES OF THE PEOPLES' BOARD OF DIRECTORS AS DIRECTORS OF THE COMPANY.
Proxies marked as abstentions and shares held in street name which have been
designated by brokers on proxies as not voted will not be counted as votes cast.
Such proxies will be counted for purposes of determining a quorum at the Annual
Meeting. Except for procedural matters incident to the conduct of the Annual
Meeting, the Company does not know of any other matters that are to come before
the Annual Meeting. If any other matters are properly brought before the Annual
Meeting, the persons named in the accompanying proxy will vote the shares
represented by such proxies on such matters as determined by a majority of the
Board of Directors.
The presence of a shareholder at the Annual Meeting will not
automatically revoke such shareholder's proxy. However, shareholders may revoke
a proxy at any time prior to its exercise by filing with the Secretary of the
Company, M. Scott Patterson, a written notice of revocation, by delivering to
the Company a duly executed proxy bearing a later date, or by attending the
Annual Meeting and voting in person.
The cost of soliciting proxies will be borne by Peoples. In addition
to the solicitation of proxies by mail, the Company, through its directors,
officers and regular employees, may also solicit proxies personally or by
telephone or telegraph. The Company will also request persons, firms and
corporations holding shares in their names or in the names of their nominees,
which are beneficially owned by others, to send proxy materials to and obtain
proxies from such beneficial owners, and will reimburse such holders for their
reasonable expenses in doing so.
The securities which can be voted at the Annual Meeting consist of
shares of common stock, par value $.10 per share (the "Common Stock"), of the
Company. Each share entitles its owner to one vote on all matters. The close
of business on March 12, 1998 has been fixed by the Board of Directors as the
record date for determination of shareholders entitled to vote at the Annual
Meeting; there were approximately 815 record holders of the Company's Common
Stock as of such date. The number of shares of Common Stock outstanding on
March 12, 1998 was 3,428,744. The presence, in person or by proxy, of at least
a majority of the total number of outstanding shares of Common Stock is
necessary to constitute a quorum at the Annual Meeting.
<PAGE>
A copy of the Annual Report to Shareholders for the fiscal year ended
December 31, 1997 accompanies this Proxy Statement. THE COMPANY IS REQUIRED TO
FILE AN ANNUAL REPORT ON FORM 10-K FOR ITS FISCAL YEAR ENDED DECEMBER 31, 1997
WITH THE SECURITIES AND EXCHANGE COMMISSION ("SEC"). SHAREHOLDERS MAY OBTAIN,
FREE OF CHARGE, A COPY OF SUCH ANNUAL REPORT ON FORM 10-K BY WRITING M. SCOTT
PATTERSON, SECRETARY, AT THE PEOPLES BANCTRUST COMPANY, INC., P.O. BOX 799,
SELMA, ALABAMA 36702-0799.
PROPOSAL I -- ELECTION OF DIRECTORS
With respect to the election of directors, each shareholder of record
on the voting record date is entitled to one vote for each share of Common Stock
held. There are no cumulative voting rights.
The Articles of Incorporation and Bylaws of the Company each provide
that the number of directors of Peoples shall be a variable range which is fixed
at a minimum number of three and a maximum number of 18, the exact number to be
fixed or changed from time to time, within the minimum and maximum, by the Board
of Directors. The Board of Directors has determined that the number of
directors be twelve persons. Directors are elected to serve until the next
annual meeting of the shareholders and until their successors are elected and
qualified. There are no arrangements or understandings between the Company and
any person pursuant to which such person has been or will be elected a director.
At the Annual Meeting, twelve directors will be elected. The Board of
Directors has nominated all current directors for a term of one year and until
their successors are elected and qualified. It is the intention of the persons
named in the proxy to vote the shares represented by each properly executed
proxy for the election as directors of each of the twelve nominees listed below
for a one-year term, unless otherwise directed by the shareholder. The Board of
Directors believes that each of such nominees will stand for election and will
serve if elected as a director. However, if any person nominated by the Board
of Directors fails to stand for election or is unable to accept election, the
proxies will be voted for the election of such other person or persons as the
Board of Directors may recommend.
Alabama law provides that directors shall be elected by a majority of
the votes cast by the shares entitled to vote in the election at a meeting at
which a quorum is present when the vote is taken.
2
<PAGE>
DIRECTORS
The following table sets forth certain information with respect to the
Company's directors.
<TABLE>
<CAPTION>
Director Position(s) Held
Name Age(a) Since(b) with the Company
- ----------------------------- ------ -------- -----------------------
<S> <C> <C> <C>
Julius R. Brown 58 1992 Director
Clyde B. Cox, Jr. 63 1983 Director
Harry W. Gamble, Jr. 61 1974 Director
Ted M. Henry 59 1968 Director
Elam P. Holley, Jr. 47 1988 Director, President and
Chief Operating Officer
Edith Morthland Jones 48 1996 Director
A. D. Lovelady 68 1978 Director
Richard P. Morthland 56 1977 Chairman of the Board
and Chief Executive Officer
Thomas E. Newton 52 1996 Director
David Y. Pearce 50 1996 Director
C. Ernest Smith 56 1991 Director
Julius E. Talton 69 1974 Director
</TABLE>
_________________
(a) As of March 1, 1998.
(b) Except for Messrs. Brown, Holley, Newton, Pearce and Smith and Mrs. Jones,
includes term of office as director of the Bank prior to formation of the
Company as the holding company for the Bank in April 1985. Each director of
the Company is also a director of the Bank.
The principal occupation(s) and business experience for the past five
years of each director of the Company are set forth below:
Julius R. Brown is President of Wallace Community College, Selma.
Clyde B. Cox, Jr. is a surgeon.
Harry W. Gamble, Jr. is a member of the law firm of Gamble, Gamble,
Calame and Wilson, L.L.C.
Ted M. Henry is Chairman and Chief Executive Officer of Henry Brick
Company, Inc.
Elam P. Holley, Jr. has served as President and Chief Operating
Officer of the Bank since February 1994. Prior to that he was Executive Vice
President and Chief Administrative Officer of the Bank. Mr. Holley served as
Secretary of the Company from 1984 until 1997 when he was elected President and
Chief Operating Officer of the Company.
Edith Morthland Jones has served as film liaison for the Selma-Dallas
County Chamber of Commerce since 1988. Prior to that she served as Director of
Tourism and Travel for the Selma-Dallas County Chamber of Commerce. She is the
daughter of Rex J. Morthland, the sister of Richard P. Morthland and the sister-
in-law of M. Scott Patterson, Executive Vice President, Investment Officer and
Secretary of the Bank and Executive Vice President and Secretary of the Company.
A. D. Lovelady has served as Chairman of the Board of Lovelady
Construction Company, Inc. since January 1996. Prior to that he was President of
Lovelady Construction Company, Inc.
3
<PAGE>
Richard P. Morthland has served as Chairman of the Board and Chief
Executive Officer of the Bank since February 1994. Prior to that he was
President and Chief Executive Officer of the Bank. Mr. Morthland has been
President of the Company since its formation in 1984. He is the son of Rex J.
Morthland, the brother of Edith Morthland Jones and the brother-in-law of M.
Scott Patterson.
Thomas E. Newton is a partner in the commercial real estate
development firm of Newton, Oldacre, and McDonald, L.L.C., Prattville, Alabama.
David Y. Pearce has been the owner of Pearce Catfish Farms since 1971
and President of Pearce Catfish Farms, Inc. since 1993.
C. Ernest Smith is the Mayor of Greenville, Alabama and owner of the
Greenville Shoe Shop.
Julius E. Talton is Chairman of the Board of Talton TeleCommunications
Corporation and has served as Chairman of the Board of Talton Holdings, Inc.
since December 1996.
DIRECTORS EMERITUS
Rex J. Morthland is Chairman Emeritus of the Board of Directors of the
Bank.
Wallace A. Buchanan is the President of Buchanan Hardwoods, Inc.
W. Russell Buster, Jr. is retired. Previously he was President of the
Bush Hog Agricultural Implement Division of Allied Products Corporation.
J.A. Minter, Jr. is a farmer and ginner.
Clinton S. Wilkinson, Jr. is a dentist.
B. Frank Wilson is Chairman Emeritus of the Board of Directors of the
Bank.
CORPORATE GOVERNANCE AND OTHER MATTERS
The Board of Directors of the Company acts as a nominating committee
for selecting management's nominees for election as directors. Nominations may
be made by shareholders, provided such nominations are made in writing and
submitted to the Secretary or the President of the Company at least three days
prior to the date of the Annual Meeting. No further nominations shall be
accepted, unless the shareholders, by majority vote, determine that additional
nominations are to be accepted, in which event further nominations as so
determined by the shareholders may be made at the Annual Meeting. There are no
standing committees of the Board of Directors of the Company.
The Board of Directors of the Bank carries out many of its duties
through committees.
The Audit and Examination Committee of the Bank's Board of Directors
directs and reviews the activities of the internal audit department and reviews
the adequacy of internal controls established by the Bank's management. This
committee reviews the audit reports of the Bank's independent accountants, the
independent accountants' letter to management concerning the effectiveness of
internal controls and management's response to that letter. In addition, this
committee reviews and recommends to the Board of Directors the firm to be
engaged as the Bank's independent accountants. During 1997, this committee
conducted four meetings as an audit committee. This committee also reviews the
examination reports of the Bank's regulatory agencies and, during 1997,
conducted one meeting as an examination committee. Members of this committee are
Edith Morthland Jones, Clyde B. Cox, Jr. and C. Ernest Smith.
4
<PAGE>
The Compensation Committee of the Bank's Board of Directors makes
recommendations concerning salary and discretionary bonuses payable to officers
of the Bank. During 1997, it held five meetings. Members of this committee are
Thomas E. Newton, David Y. Pearce and Harry W. Gamble, Jr.
During the year ended December 31, 1997, the Company's Board of
Directors and the Bank's Board of Directors each held 14 meetings. All incumbent
directors attended 75% or more of the aggregate of (a) the total number of
meetings of the boards of directors and (b) the total number of meetings held by
all committees on which they served.
EXECUTIVE COMPENSATION
The following table sets forth cash and noncash compensation for each
of the last three fiscal years awarded to or earned by the named executive
officers of the Company.
SUMMARY COMPENSATION TABLE
<TABLE>
<CAPTION>
Long-Term Compensation
----------------------------------------
Annual Compensation Awards Payouts
------------------------------------- ------------------------------- -------
Restricted Securities
Name and Other Annual Stock Underlying LTIP All Other
Principal Position (a) Year Salary Bonus Compensation (b) Award(s) Options/SARs(#)(c) Payouts Compensation(d)(e)
- ------------------------- ---- --------- -------- ---------------- ---------- ------------------ ------- -----------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Richard P. Morthland 1997 $160,487 $23,401 -- -- 4,000 -- $10,555
Chairman and Chief 1996 156,339 48,697 -- -- 4,000 -- 10,381
Executive Officer of 1995 149,065 33,505 -- -- -- 12,147
the Company and
the Bank
Elam P. Holley, Jr. 1997 $111,791 $11,201 -- -- 3,000 -- $10,760
President and Chief 1996 103,042 5,787 -- -- 3,000 -- 8,120
Operating Officer 1995 98,145 4,832 -- -- 3,000 -- 7,770
of the Company and
the Bank
</TABLE>
(a) No other executive officer earned in excess of $100,000 in salary and bonus
in 1997, 1996 and 1995.
(b) Executive officers of the Company receive indirect compensation in the form
of certain perquisites and other personal benefits. The amount of such
benefits in 1997, 1996 and 1995 received by the named executive officers did
not exceed 10% of the executive's annual salary and bonus.
(c) Award amounts and other data herein have been adjusted for a two-for-one
stock split effected through a stock dividend paid in March 1995 and a two-
for-one stock split effected through a stock dividend paid in June 1997.
(d) "All Other Compensation" includes awards to Mr. Morthland of $3,402, $3,680
and $3,672 in 1997, 1996 and 1995, respectively, contributed on behalf of
such executive to the Employee Stock Ownership Plan ("ESOP") to fund
purchases of the Company's Common Stock pursuant to the Incentive
Performance and Reward Program. Also includes contributions of behalf of
Mr. Morthland of $6,653, $6,701 and $8,475 in 1997, 1996 and 1995,
respectively, to the Bank's Section 125 "cafeteria" plan.
(e) "All Other Compensation" includes awards to Mr. Holley of $2,551, $2,662 and
$2,415 in 1997, 1996 and 1995, respectively, contributed on behalf of such
executive to the ESOP to fund purchases of the Company's Common Stock
pursuant to the Incentive Performance and Reward Program. Also includes
contributions on behalf of Mr. Holley of $8,209, $5,458 and $5,355 in 1997,
1996 and 1995, respectively, to the Bank's Section 125 "cafeteria" plan.
5
<PAGE>
DIRECTORS' COMPENSATION
Directors of the Company and the Bank are presently paid $800 per month for
service in both capacities and $150 for each committee meeting attended.
Directors who are officers of the Company or the Bank (i.e., Messrs. Richard P.
----
Morthland and Elam P. Holley, Jr.) are not entitled to such fees.
OPTION GRANTS IN FISCAL YEAR 1997
The following table contains information concerning the grant of stock
options under the 1992 Stock Option Plan (the "Option Plan") to the named
executive officers. The Option Plan does not provide for the grant of stock
appreciation rights.
<TABLE>
<CAPTION>
Individual Grants
----------------------------------------------------------------------------
Number of Securities Percent of Total Potential Realizable Value at
Underlying Options Granted Assumed Annual Rates of Stock
Options Granted to Employees in Exercise or Base Price Appreciation
(Number of Shares) Fiscal Year Price Expiration for Option Term(a)
($ per Share) Date
-------------------- ---------------- ----------------- ------------ -----------------------------
<S> <C> <C> <C> <C> <C> <C>
5%($) 10%($)
------------- -------------
Richard P. Morthland 4,000 24.69% 17.05 01/20/02 10,920 31,640
Elam P. Holley, Jr. 3,000 18.52% 15.50 01/20/02 29,250 74,100
</TABLE>
- ------------------
(a) Represents the difference between the aggregate exercise price of the
options and the aggregate value of the underlying Common Stock at the end of
the expiration date assuming the indicated annual rate of appreciation in
the value of the Common Stock.
AGGREGATED FISCAL 1997 OPTION EXERCISES AND YEAR END OPTION VALUES
The following table sets forth information concerning options exercised
during fiscal 1997 and the value of options held by the named executive officers
at the end of the fiscal year.
<TABLE>
<CAPTION>
Number of Securities Value of Unexercised
Underlying Unexercised In-the-Money Options at
Options at Fiscal Year End Fiscal Year End ($)(b)
Shares Acquired ---------------------------- -----------------------
on Exercise Value Exercisable/Unexercisable Exercisable/
Name (Number of Shares) Realized($)(a) (Number of Shares) Unexercisable
- ----------------------- ----------------- ------------- --------------------------- -----------------------
<S> <C> <C> <C> <C>
Richard P. Morthland 13,600 313,380 ---/8,000 ---/134,080
Elam P. Holley, Jr. -- -- 10,700/6,000 253,770/108,180
</TABLE>
- ---------------
(a) Difference between fair market value of underlying Common Stock and the
exercise price at exercise.
(b) Difference between fair market value of underlying Common Stock and the
exercise price at fiscal year end. An option is in-the-money if the fair
market value of the underlying security exceeds the exercise price of the
option.
6
<PAGE>
PENSION PLAN
The following table illustrates the maximum estimated annual benefits
payable upon retirement pursuant to the Company's defined benefit pension plan
(the "Pension Plan") based upon the Pension Plan formula for specified average
Final Compensation and specified years of service.
<TABLE>
<CAPTION>
Years of Service
Average Final -----------------------------------------------------------------------------
Compensation 10 20 30 40
- -------------------------------------- --------------- -------------- --------------- ---------------
<S> <C> <C> <C> <C>
$ 20,000............................. $ 2,000 $ 4,000 $ 6,000 $ 8,000
60,000............................. 7,900 15,800 23,600 30,600
80,000............................. 11,200 22,400 33,500 43,100
100,000............................ 14,500 29,000 43,400 55,700
125,000............................ 18,600 37,200 55,800 71,400
160,000 and above.................. 24,400 48,800 73,100 93,300
</TABLE>
Benefits are hypothetical amounts only. Currently, the maximum annual
benefit payable under the Pension Plan is $125,000. Also, average final
compensation in excess of $160,000 is not covered under the Pension Plan.
"Average Final Compensation," which is based upon the average annual salary (as
defined) for the five consecutive years of highest salary, is based upon
compensation that would appear under the "Salary" column of the Summary
Compensation Table. As of December 31, 1997, Messrs. Morthland and Holley had
34 and 24 years of credited service, respectively, under the Pension Plan.
Benefits set forth in the preceding table are computed as a straight-life
annuity and are adjusted to reflect payments expected to be made to employees by
Social Security.
REPORT OF THE COMPENSATION COMMITTEE
As members of the Compensation Committee of the Bank, it is our duty to
review compensation policies applicable to executive officers; to consider the
relationship of corporate performance to that compensation; to recommend salary
and bonus levels for executive officers for consideration by the Board of
Directors of the Bank; and to administer various incentive plans of the Company
and the Bank.
Overview. Under the compensation policies of the Bank, which are endorsed
by the Compensation Committee, compensation is paid based both on the executive
officer's performance and the performance of the entire Company. In assessing
the performance of the Company and the Bank for purposes of compensation
decisions, the Compensation Committee considers a number of factors, including
profits of the Company and the Bank during the past year relative to their
business plans, changes in the value of the Company's stock, reports of federal
regulatory examinations of the Company and the Bank, growth, business plans for
future periods, and regulatory capital levels. The Compensation Committee
assesses individual executive performance based upon its determination of the
officer's contributions to the performance of the Company and the Bank and the
accomplishment of the Company's and the Bank's strategic goals, such as loan
growth, deposit growth, expense control and net income. In assessing
performance for 1997 and previous years, the members of the Committee did not
make use of a mechanical weighting formula or use specific performance targets,
but instead weighed the described factors as they deemed appropriate in the
total circumstances.
Base Salary. The 1997 salary levels of the Bank's senior officers
(including the named executive officers) were established in 1996 consistent
with this compensation policy. In its 1996 review of base compensation, the
Committee determined that the performance of Mr. Morthland in managing the
Company and the Bank was satisfactory, based upon the 1996 financial performance
of the Company, including the growth in assets, income, and capitalization
during 1996; the financial performance trends for 1996 and the preceding four
years, which included growth in assets, net income, and stockholders' equity in
each year; the results of confidential regulatory examinations; his continued
involvement in community affairs in the market area served by the Bank; the
Company's planned levels of financial performance for 1997; and a general level
of satisfaction with the
7
<PAGE>
management of the Company and the Bank. Based upon the results of this review,
the salary of Mr. Morthland was established at $167,140 per year for 1997, which
included a contribution to the Bank's Section 125 "cafeteria" plan and
represented an increase of 2.5% over his 1996 base salary.
Bonuses. Bonuses for 1997 were awarded to executive officers in December
1997 based on the officer's performance and the performance of the Company and
the Bank for the year 1997 consistent with the policy described above. A bonus
of $23,401 was awarded to Mr. Morthland in 1997. Factors considered by the
Committee in its determination of this award included, among others, the growth
in total assets and net income.
Stock Options. The purposes of the Option Plan are to attract, retain and
motivate key officers of the Company and the Bank by providing key officers with
a stake in the success of the Company, as measured by the value of its shares,
and to increase the commonality of interests among key employees and other
shareholders. The Board of Directors has general responsibility for granting
stock options to key employees and administering the Option Plan. During 1997,
incentive stock options for 16,200 shares were granted at an exercise price of
$15.50 per share (the fair market value of the shares on the dates of grant),
including options for 4,000 shares granted to Mr. Morthland which become
exercisable on the date and at the price noted in the table which accompanies
this report.
No member of the Compensation Committee is a former or current officer or
employee of the Company or the Bank.
February 18, 1998
Clyde B. Cox, Jr., Chairman
Harry W. Gamble, Jr.
Thomas E. Newton
(Compensation Committee at December 31, 1997)
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
Harry W. Gamble, Jr., a director of Peoples and the Bank, is a member of
the firm of Gamble, Gamble, Calame and Wilson, L.L.C. which renders legal
services to the Company and the Bank. In the year ended December 31, 1997, Mr.
Gamble's firm received fees of $128,716 for legal services to the Company and
the Bank.
8
<PAGE>
STOCK PERFORMANCE COMPARISONS
The following graph, which was prepared by SNL Securities LC,
Charlottesville, Virginia, shows the cumulative total return on the Common Stock
of the Company over the last five years, compared with the NASDAQ Total Return
Index, comprised of all U.S. Companies quoted on NASDAQ, and the SNL (less
than)$500 Million Bank Index, comprised of publicly traded banks and bank
holding companies with total assets of less than $500 million. Cumulative total
return on the stock or the index equals the total increase in value since
December 31, 1992 assuming reinvestment of all dividends paid into the stock or
the index, respectively. The graph was prepared assuming that $100 was invested
on December 31, 1992 in the Common Stock, and the securities included in the
indexes. Since June 1994, the Common Stock of the Company has been quoted on the
NASDAQ Small Cap Market. Prior to that time, there was not an established public
trading market for the Common Stock and the price of the Common Stock was quoted
in the National Daily Quotation Services "Pink Sheets"(TM).
CUMULATIVE TOTAL SHAREHOLDER RETURN
COMPARED WITH PERFORMANCE OF SELECTED INDEXES
DECEMBER 31, 1992 THROUGH DECEMBER 31, 1997
<TABLE>
<CAPTION>
PERIOD ENDING
--------------------------------------------------------------------
INDEX 12/31/92 12/31/93 12/31/94 12/31/95 12/31/96 12/31/97
- --------------------------------------------- -------- -------- -------- -------- -------- --------
<S> <C> <C> <C> <C> <C> <C>
Peoples BancTrust Company, Inc. (The) 100.00 138.28 150.61 218.53 333.64 678.05
NASDAQ - Total US 100.00 114.80 112.21 158.70 195.19 239.53
SNL (less than)$500M Bank Asset-Size Index 100.00 130.56 140.42 192.09 247.24 421.47
</TABLE>
9
<PAGE>
CERTAIN TRANSACTIONS
The Company and the Bank have had, and expect to have in the future,
transactions in the ordinary course of business with directors and executive
officers and members of their immediate families, as well as with principal
shareholders. All loans included in such transactions were made in the ordinary
course of business on substantially the same terms, including interest rates and
collateral, as those prevailing for comparable transactions with non-affiliated
persons. It is the belief of management that such loans neither involved more
than the normal risk of collectability nor presented other unfavorable features.
STOCK OWNERSHIP OF MANAGEMENT
The following table sets forth information as of March 12, 1998 with
respect to the shares of Common Stock beneficially owned by each director and
nominee for director of the Company, including the named executive officers, and
by all directors and executive officers of the Company as a group. This
information is based on filings with the SEC or information furnished to the
Company by such persons.
<TABLE>
<CAPTION>
AMOUNT AND PERCENT OF
Nature of Beneficial Common Stock
Name OWNERSHIP(A)(B) OUTSTANDING
- ----------------------------- ------------------------ -------------
<S> <C> <C>
Julius R. Brown 1,233 *
Clyde B. Cox, Jr. 14,160 *
Harry W. Gamble, Jr. 10,136 *
Ted M. Henry 11,116 *
Elam P. Holley, Jr. 19,499 *
Edith Morthland Jones (c) 182,290 5.32%
A. D. Lovelady 38,456 1.12%
Richard P. Morthland (c) 765,818 22.34%
Thomas E. Newton 1,400 *
David Y. Pearce 1,236 *
C. Ernest Smith 1,262 *
Julius E. Talton 102,110 2.98%
All directors and executive
officers as a group (d)
(19 persons) 1,338,576 38.91%
</TABLE>
* Less than 1% of the Company's outstanding Common Stock.
(a) For purposes of this table and the table under "Principal Holders of Common
Stock," under the rules of the SEC, an individual is considered to
"beneficially own" any share of Common Stock which he, directly or
indirectly, through any contract, arrangement, understanding, relationship,
or otherwise, has or shares: (1) voting power, which includes the power to
vote, or to direct the voting of, such security; and/or (2) investment
power, which includes the power to dispose, or to direct the disposition of,
such security. In addition, an individual is deemed to be the beneficial
owner of any share of Common Stock of which he has the right to acquire
voting or investment power within 60 days of March 12, 1998.
(Footnotes continued on following page)
10
<PAGE>
(b) Includes shares owned directly by directors and executive officers of the
Company as well as shares held by their spouses and children, trusts of
which certain directors are trustees and corporations in which certain
directors own a controlling interest. Includes shares allocated to the
accounts of participants in the ESOP, and 11,600 shares of Common Stock
subject to outstanding options which are exercisable within 60 days of March
12, 1998. Does not include 33,500 shares of Common Stock subject to
outstanding options granted to executive officers which are not exercisable
within 60 days of March 12, 1998, of which Richard P. Morthland holds
options for 9,400 shares and Elam P. Holley, Jr. holds options for 6,600
shares.
(c) See "Principal Holders of Common Stock."
(d) Includes officers of the Company and executive officers of the Bank.
SECTION 16(A) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
Section 16(a) of the Securities Exchange Act of 1934 requires the Company's
officers and directors, and persons who own more than 10% of a registered class
of the Company's equity securities, to file reports of ownership and changes in
ownership with the SEC. Officers, directors and greater than 10% shareholders
are required to furnish the Company with copies of all such reports. Based
solely on its review of copies of such reports received by it, or written
representations from certain reporting persons that no annual report of change
in beneficial ownership is required, the Company believes that, during the year
ended December 31, 1997, all such filing requirements were complied with, except
that initial statements of beneficial ownership of securities were not filed on
a timely basis for Jefferson G. Ratcliffe and Bobby J. Leach, executive officers
of the Company, but such reports were subsequently filed.
PRINCIPAL HOLDERS OF COMMON STOCK
The following table sets forth information as of March 12, 1998 with
respect to the persons believed by the Company to be the beneficial owners of
more than 5% of the Common Stock. This information is based on filings with the
SEC or information furnished to the Company by such persons.
<TABLE>
<CAPTION>
NAME AND ADDRESS AMOUNT AND NATURE PERCENT OF COMMON
of Beneficial Owner OF BENEFICIAL OWNERSHIP(A) STOCK OUTSTANDING
- ------------------------------------ --------------------------- ------------------
<S> <C> <C>
Richard P. Morthland 765,818 (b) 22.34%
310 Broad Street
Selma, Alabama 36701
Ann Plant Morthland 432,304 (c) 12.61%
Rex J. Morthland
1027 Houston Park
Selma, Alabama 36701
Edith Morthland Jones 182,290 (d) 5.32%
432 Church Street
Selma, Alabama 36701
Mary Ann Morthland Patterson 164,329 (e) 4.79%
M. Scott Patterson
209 Church Street
Selma, Alabama 36701
The Peoples Bank and Trust Company 802,483 (f) 23.40%
310 Broad Street
Selma, Alabama 36701
</TABLE>
(Footnotes on following page)
11
<PAGE>
- ---------------
(a) See Note (a) to the table under "Stock Ownership of Management." Except as
disclosed in the Notes below, each of the following persons disclaims that
he or she is acting in concert with, or as a member of a group consisting
of, the other named individuals. Richard P. Morthland, Edith Plant
Morthland Jones and Mary Ann Morthland Patterson are the son and daughters
of Rex J. and Ann Plant Morthland.
(b) Included in such 765,818 shares are (1) 137,384 shares owned directly by
Richard P. Morthland, his spouse and a child; (2) 32,160 shares held by a
trust of which Richard P. Morthland is trustee; (3) 553,052 shares held by
three trusts of which the Bank is trustee and under which Richard P.
Morthland has voting power; and (4) 40,322 shares held by a trust of which
Richard P. Morthland is co-trustee with Rex J. Morthland. See Notes (c)(4)
and (f) below. Also included in such 765,818 shares are 2,900 shares
allocated to the account of Richard P. Morthland under the ESOP. Such
765,818 shares do not include 9,400 shares of Common Stock subject to
outstanding options held by Mr. Morthland which are not exercisable within
60 days of March 12, 1998, and 3,072 shares held by Mr. Morthland's son as
to which he disclaims beneficial ownership.
(c) Included in such 432,304 shares are (1) 62,050 shares owned directly by Ann
Plant Morthland; (2) 103,432 shares owned directly by Rex J. Morthland; (3)
145,856 shares held by a trust of which the Bank is trustee and under which
Ann Plant Morthland has voting power; and (4) 120,966 shares held by three
trusts of which Rex J. Morthland is co-trustee with Richard P. Morthland,
Edith Morthland Jones and Mary Ann Morthland Patterson, each as to 40,322
shares. See Note (b)(4) above and Notes (d)(3), (e)(2) and (f) below.
(d) Included in such 182,290 shares are (1) 109,808 shares owned directly by
Edith Morthland Jones and her spouse and children; (2) 32,160 shares held by
a trust of which Edith Morthland Jones is trustee; and (3) 40,322 shares
held by a trust of which Edith Morthland is co-trustee with Rex J.
Morthland. Such 182,290 shares do not include 2,797 shares and 165 shares
held by Mrs. Jones' son and stepson, respectively, as to which she
disclaims beneficial ownership. See Note (c)(4) above.
(e) Included in such 164,329 shares are (1) 122,614 shares owned directly by
Mary Ann Morthland Patterson, her spouse, M. Scott Patterson, and a child;
(2) 40,322 shares held by a trust of which Mary Ann Morthland Patterson is
co-trustee with Rex J. Morthland; and (3) 1,393 shares allocated to the
account of M. Scott Patterson under the ESOP. Such 164,329 shares do not
include 19,120 shares held by the Pattersons' son as to which they disclaim
beneficial ownership and 4,700 shares of Common Stock subject to outstanding
options held by Mr. Patterson which are not exercisable within 60 days of
March 12, 1998. See Note (c)(4) above.
(f) The Bank is the trustee of four trusts for the benefit of members of the
Plant and Morthland families. Under these trusts the Bank is authorized to
dispose of 698,908 shares, which are described in Notes (b)(3) and (c)(3)
above. Under other trusts the Bank has dispositive power with respect to
86,091 shares of Common Stock and shared voting and dispositive power with
respect to 16,674 shares of Common Stock.
INDEPENDENT ACCOUNTANTS
The Board of Directors has appointed the firm of Coopers & Lybrand
L.L.P. to continue as independent accountants for the Company for the fiscal
year ending December 31, 1998. Coopers & Lybrand L.L.P. served as the Company's
independent accountants for the year ended December 31, 1997 and has served as
the Bank's independent accountants since 1982. A representative of Coopers &
Lybrand L.L.P. is expected to be present at the Annual Meeting and available to
respond to appropriate questions, and will have the opportunity to make a
statement if he so desires.
12
<PAGE>
DATE FOR SUBMISSION OF SHAREHOLDER PROPOSALS
Any shareholder who intends to present a proposal for action at the
1999 annual meeting of the shareholders, to be held on or about April 13, 1999,
must forward a copy of the proposal or proposals to the Company's principal
executive office. Any such proposal or proposals intended to be presented at
the 1999 annual meeting of the shareholders must be received by the Company for
inclusion in its proxy statement and form of proxy relating to that meeting by
November 20, 1998. Nothing in this paragraph shall be deemed to require the
Company to include in its proxy statement and proxy relating to the 1999 annual
meeting any shareholder proposal which does not meet all of the requirements for
inclusion established by the SEC in effect at the time such proposal is
received.
OTHER MATTERS
The Board of Directors does not know of any other matters to be
presented for action by the shareholders at the Annual Meeting. If, however,
any other matters known are properly brought before the Annual Meeting, the
persons named in the accompanying proxy will vote such proxy on such matters as
determined by the Board of Directors.
By Order of the Board of Directors
M. Scott Patterson
M. SCOTT PATTERSON
Secretary
Selma, Alabama
March 20, 1998
13
<PAGE>
THE PEOPLES BANCTRUST COMPANY, INC.
310 BROAD STREET
SELMA, ALABAMA 36701
REVOCABLE PROXY FOR THE ANNUAL MEETING
OF THE SHAREHOLDERS
APRIL 14, 1998
The undersigned hereby constitutes and appoints Wallace A. Buchanan,
W. Russell Buster, Jr. and Clinton S. Wilkinson, Jr., and each of them, the
proxies of the undersigned with full power of substitution, to attend the Annual
Meeting of the Shareholders of The Peoples BancTrust Company, Inc. (the
"Company") to be held at the main office of The Peoples Bank and Trust Company,
310 Broad Street, Selma, Alabama on Tuesday, April 14, 1998 at 5:00 p.m., local
time, and any adjournments thereof, and to vote all the shares of stock of the
Company which the undersigned may be entitled to vote, upon the following
matters.
1. The Election of Directors: Julius R. Brown, Clyde B. Cox, Jr., Harry
W. Gamble, Jr., Ted M. Henry, Elam P. Holley, Jr., Edith Morthland Jones, A. D.
Lovelady, Richard P. Morthland, Thomas E. Newton, David Y. Pearce, C. Ernest
Smith and Julius E. Talton.
<TABLE>
<S> <C>
[_] FOR all nominees listed above [_] WITHHOLD AUTHORITY to vote
(except as marked to the contrary below). for all nominees listed above.
</TABLE>
(INSTRUCTION: TO WITHHOLD AUTHORITY TO VOTE FOR ANY INDIVIDUAL NOMINEE, PRINT
THAT NOMINEE'S NAME BELOW.)
- -------------------------------------------------------------------------------
2. The transaction of such other business as may properly come before
the Annual Meeting or any adjournments thereof.
THIS PROXY IS SOLICITED BY THE BOARD OF DIRECTORS OF THE COMPANY, WILL
BE VOTED IN ACCORDANCE WITH THE INSTRUCTIONS MARKED HEREIN, AND WILL BE VOTED
FOR THE ELECTION OF DIRECTORS IF NO INSTRUCTIONS TO THE CONTRARY ARE MARKED
HEREIN. IF ANY OTHER BUSINESS IS PRESENTED AT THE ANNUAL MEETING, THIS PROXY
WILL BE VOTED BY THOSE NAMED IN THIS PROXY AS DETERMINED BY A MAJORITY OF THE
BOARD OF DIRECTORS. AT THE PRESENT TIME, THE BOARD OF DIRECTORS KNOWS OF NO
OTHER BUSINESS TO BE PRESENTED AT THE ANNUAL MEETING.
The undersigned hereby acknowledges receipt of a copy of the
accompanying Notice of Annual Meeting of the Shareholders and Proxy Statement
and the Annual Report to Shareholders for the fiscal year ended December 31,
1997, and hereby revokes any proxy heretofore given. THIS PROXY MAY BE REVOKED
AT ANY TIME BEFORE ITS EXERCISE.
Date:
-------------------------------
Signature:
--------------------------
Signature:
--------------------------
PLEASE MARK, DATE AND SIGN AS YOUR NAME APPEARS HEREIN AND RETURN IN THE
ENCLOSED ENVELOPE. If acting as executor, administrator, trustee, guardian,
etc. you should so indicate when signing. If the signer is a corporation,
please sign the full name by duly appointed officer. If a partnership, please
sign in partnership name by authorized person. If shares are held jointly, each
shareholder named should sign.
