<PAGE> 1
SCHEDULE 14A INFORMATION
PROXY STATEMENT PURSUANT TO SECTION 14(A) OF THE SECURITIES
EXCHANGE ACT OF 1934 (AMENDMENT NO. )
FILED BY THE REGISTRANT / X /
FILED BY A PARTY OTHER THAN THE REGISTRANT / /
Check the appropriate box:
/ / PRELIMINARY PROXY STATEMENT
/X/ DEFINITIVE PROXY STATEMENT
/ / DEFINITIVE ADDITIONAL MATERIALS
/ / SOLICITING MATERIAL PURSUANT TO SEC.240.14A-11(C) OR SEC.240.14A-12
Southtrust Corporation
(NAME OF REGISTRANT AS SPECIFIED IN CHARTER)
C. Larimore Whitaker
(NAME OF PERSON(S) FILING PROXY STATEMENT)
Payment of Filing Fee (Check the appropriate box):
/ / $125 per Exchange Act Rules 0-11(c)(1)(ii), or 14a-6(i)(1), or
14a-6(j)(2).
/ / $500 per each party to the controversy pursuant to Exchange Act Rule
14a-6(i)(3).
/ / Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and
0-11.
(1) Title of each class of securities to which transaction applies:
(2) Aggregate number of securities to which transaction applies:
(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11:
(4) Proposed maximum aggregate value of transaction:
Set forth the amount on which the filing fee is calculated and state how it
was determined.
/X/ 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: $125.00
(2) Form, Schedule or Registration Statement No.: Schedule
14A -- Preliminary Proxy
(3) Filing Party: SouthTrust Corporation
(4) Date Filed: February 24, 1994
<PAGE> 2
SOUTHTRUST CORPORATION
----------------------
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD ON APRIL 20, 1994
TO THE STOCKHOLDERS:
The Annual Meeting of Stockholders (the "Annual Meeting") of SouthTrust
Corporation (the "Company") will be held in the auditorium on the eighth floor
of the SouthTrust Tower, 420 North 20th Street, Birmingham, Alabama, on
Wednesday, April 20, 1994, at 9:00 A.M., Central Time, for the following
purposes:
(1) To elect four (4) persons to the Board of Directors of the
Company, each person to serve a three-year term and until such person's
successor is duly elected and qualified;
(2) To amend Article FOURTH of the Restated Certificate of
Incorporation of the Company to increase the number of shares of authorized
Common Stock of the Company from 150,000,000 shares, with a par value of
$2.50 per share, to 200,000,000 shares, with a par value of $2.50 per
share;
(3) To approve and ratify the Senior Officer Performance Incentive
Plan of the Company; and
(4) To transact such other business as may properly come before the
Annual Meeting.
Holders of Common Stock of the Company of record at the close of business
on February 25, 1994 are entitled to notice of and to vote at the Annual
Meeting.
You are cordially invited to attend the Annual Meeting, and we hope you
will be present at the Annual Meeting. WHETHER YOU PLAN TO ATTEND OR NOT, PLEASE
SIGN AND RETURN THE ENCLOSED PROXY SO THAT THE COMPANY MAY BE ASSURED OF THE
PRESENCE OF A QUORUM AT THE ANNUAL MEETING. A postage-paid envelope addressed to
the Company is enclosed for your convenience in returning your proxy to the
Company.
By Order Of The Board Of Directors
AUBREY D. BARNARD
Secretary
Birmingham, Alabama
March 9, 1994
<PAGE> 3
SOUTHTRUST CORPORATION
---------------------
PROXY STATEMENT
FOR THE ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD ON APRIL 20, 1994
The accompanying proxy is solicited on behalf of the Board of Directors of
SouthTrust Corporation, a Delaware corporation (the "Company"), for use at the
Annual Meeting of Stockholders (the "Annual Meeting") of the Company to be held
in the auditorium on the eighth floor of the SouthTrust Tower, 420 North 20th
Street, Birmingham, Alabama, on Wednesday, April 20, 1994 at 9:00 A.M., Central
Time. It is anticipated that this proxy material will be mailed to stockholders
on or about March 9, 1994.
The only matters to be considered at the Annual Meeting are (i) the
election of four directors to serve for the term of office described below, (ii)
the approval of a proposed amendment to the Company's Restated Certificate of
Incorporation to increase the number of shares of Common Stock of the Company
authorized for issuance thereunder to 200,000,000 shares, and (iii) the approval
and ratification of the Senior Officer Performance Incentive Plan of the Company
(the "Incentive Plan"). All shares of Common Stock represented by an executed
and completed proxy received by the Company in time for voting at the Annual
Meeting will be voted in accordance with the instructions specified thereon, and
if no instructions are specified thereon, will be voted in favor of the election
as directors of the nominees named in the Proxy Statement and in favor of the
proposals described above. A proxy may be revoked at any time prior to its
exercise (i) by filing with the Secretary of the Company either an instrument
revoking the proxy or a duly executed proxy bearing a later date or (ii) by
attending the Annual Meeting and voting in person. Attendance at the Annual
Meeting by itself will not revoke a proxy.
As of February 25, 1994, the record date for the Annual Meeting, there were
issued and outstanding 79,438,365 shares of Common Stock of the Company. The
holders of each outstanding share of Common Stock of the Company as of such date
are entitled to one vote per share with respect to each matter to be considered
at the Annual Meeting. The presence, in person or by proxy, of a majority of the
outstanding shares of Common Stock of the Company is necessary to constitute a
quorum at the Annual Meeting. Shares of Common Stock represented by a properly
executed and returned proxy will be treated as present at the Annual Meeting for
purposes of determining a quorum without regard to whether the proxy is marked
as casting a vote for or against or abstaining with respect to a particular
matter. In addition, shares of Common Stock represented by "broker non-votes"
(i.e., shares of Common Stock held in record name by brokers or nominees as to
which (i) instructions have not been received from the beneficial owners or
persons entitled to vote, (ii) the broker or nominee does not have discretionary
voting power or (iii) the record holder has indicated that it does not have
authority to vote such shares on that matter) generally will be treated as
present for purposes of determining a quorum, but as described below, such
broker non-votes will not have any effect upon the voting with respect to
certain of the matters to be considered at the Annual Meeting.
The affirmative vote of the holders of a plurality of the outstanding
shares of Common Stock of the Company present in person or represented by proxy
at the Annual Meeting is necessary to elect the nominees for directors named in
the Proxy Statement. Accordingly, abstentions and broker non-votes with respect
to the election of directors will have no effect upon the election of the
directors at the Annual Meeting. The affirmative vote of the holders of a
majority of the outstanding shares of Common Stock of the Company is required
for the adoption of the proposed amendment to the Company's Restated Certificate
of Incorporation and the affirmative vote of a majority of the outstanding
shares of Common Stock of the Company present in person or by proxy at the
Annual Meeting is required for the approval and ratification of the Incentive
Plan. Abstentions and broker non-votes with respect to the proposal to amend the
Company's Restated Certificate of Incorporation will have the same effect as
votes against such proposal. With respect to the proposal to approve and ratify
the Incentive Plan, abstentions will have the same effect as votes against such
proposal, but broker non-votes will have no effect upon the approval or
disapproval of such proposal.
<PAGE> 4
ELECTION OF DIRECTORS
The Bylaws of the Company provide for a Board of Directors of not fewer
than three nor more than sixteen members. The Restated Certificate of
Incorporation and the Bylaws of the Company provide that the members of the
Board of Directors shall be divided into three classes, one class to be elected
at each annual meeting of stockholders and to serve for a term of three years.
As of the date of the Proxy Statement, the Board of Directors consists of ten
persons.
CURRENT NOMINEES
The Board of Directors proposes to nominate the four persons named below
for election as directors, such persons to serve until the 1997 Annual Meeting
of Stockholders and until their successors have been elected and shall have
qualified.
The names, ages and principal occupations during the past five years of the
nominees, the year each first became a director of the Company, and the number
and percentage of shares of the Company's Common Stock owned beneficially by
each of them as of January 31, 1994 are as follows:
<TABLE>
<CAPTION>
NUMBER AND PERCENT
OF SHARES OF COMMON
NAME, AGE AND STOCK OF THE COMPANY
PRINCIPAL OCCUPATION DIRECTOR BENEFICIALLY OWNED AS
OF NOMINEES SINCE OF JANUARY 31, 1994
- ------------------------------------------------- ----------------- ---------------------
<S> <C> <C>
Bill L. Harbert (70) February 18, 1981 604,125(1)
Chairman and Chief Executive Officer, 0.75%
Bill Harbert International Construction, Inc.
(construction business)
Allen J. Keesler, Jr. (55) January 15, 1992 4,139(2)
President and Chief Executive Officer, 0.01%
Florida Power Corporation
(electric utility business)
T. W. Mitchell (65) January 17, 1973 548,494(3)
Chairman and Chief Executive Officer, 0.68%
Stuart Construction Co., Inc.
(construction business)
William K. Upchurch, Jr. (61) April 23, 1987 46,304(4)
Chairman and Chief Executive Officer, 0.06%
W. K. Upchurch Construction Company, Inc.
(construction business)
</TABLE>
- ---------------
(1) Includes 120,000 shares held in a corporation of which Mr. Harbert is a
principal stockholder and 11,700 shares held in a trust which is revocable
by Mr. Harbert.
(2) Includes 1,129 shares held by Mr. Keesler's wife.
(3) Includes 249,135 shares held by corporations of which Mr. Mitchell is a
principal stockholder and 183,859 shares held in trust for Mr. Mitchell's
wife.
(4) Includes 9,360 shares held in a trust of which Mr. Upchurch is trustee,
1,787 shares held by trusts of which Mr. Upchurch's wife is custodian, and
2,189 shares held by Mr. Upchurch's wife.
Each of the nominees was elected as a director at the Annual Meeting of
Stockholders held on April 17, 1991, except that Mr. Keesler was elected on
January 15, 1992 by the Board of Directors of the Company.
2
<PAGE> 5
Unless directed to the contrary, the persons acting under the proxy
solicited hereby will vote for the nominees named above. Should any such nominee
become unable to accept election, which is not anticipated, it is intended that
the persons acting under the proxy will vote for the election in his stead of
such other person as the Board of Directors may recommend. Proxies may not be
voted for more than four persons.
THE BOARD OF DIRECTORS OF THE COMPANY RECOMMENDS A VOTE FOR THE NOMINEES
FOR DIRECTORS NAMED ABOVE.
CONTINUING DIRECTORS
The following tabulation sets forth with respect to those persons who were
elected as directors of the Company at previous Annual Meetings of Stockholders
(and will continue to serve as directors following the Annual Meeting) the
names, ages and principal occupations of each person during the past five years,
the year that each person's current term as a director expires, the year that
each person first became a director of the Company, and the number and
percentage of shares of Company's Common Stock owned beneficially by each person
as of January 31, 1994:
<TABLE>
<CAPTION>
NUMBER AND PERCENT
OF SHARES OF COMMON
STOCK OF THE COMPANY
CURRENT BENEFICIALLY OWNED AS
NAME, AGE AND TERM DIRECTOR OF JANUARY 31,
PRINCIPAL OCCUPATION EXPIRES SINCE 1994
- ----------------------------------- ------- ------------------- ---------------------
<S> <C> <C> <C>
John M. Bradford (55) 1995 April 23, 1987 23,943(1)
Chairman and President, 0.03%
Mrs. Stratton's Salads, Inc.
(manufacturer of prepared salads)
William C. Hulsey (55) 1995 April 16, 1986 936,865(2)
Chairman and Chief Executive 1.17%
Officer, Arlington Properties,
Inc. (real estate development)
Wallace D. Malone, Jr. (57) 1995 August 2, 1972 1,450,401(3)
Chairman and Chief Executive 1.80%
Officer of the Company
Roy W. Gilbert, Jr. (57) 1996 December 22, 1977 365,042(4)
President of the Company 0.38%
Herbert Stockham (65) 1996 October 17, 1973 102,784(5)
Chairman, Stockham Valves & 0.13%
Fittings, Inc. (manufacturing
business)
Charles G. Taylor (65) 1996 January 15, 1992 211,487(6)
President and Chief Executive 0.26%
Officer, The Taylor Group, Inc.
(contract service business)
</TABLE>
- ---------------
(1) Includes 11,540 shares held by Mr. Bradford's wife.
(2) Includes 12,000 shares held by Mr. Hulsey's wife (6,596 of which are held in
a custodial capacity) and 863,884 shares held by various trusts of which
Mr. Hulsey is a co-trustee.
(3) Includes 29,250 shares held by Mr. Malone's wife, 78,468 shares held by
minor children, 107,630 shares subject to employee stock options
exercisable within 60 days after January 31, 1994 and 263,629 shares held
in Mr. Malone's account by the trustee of the Company's Profit Sharing Plan
as to which the trustee possesses sole voting power but as to which Mr.
Malone, by virtue of allocating elections to various funds, possesses
dispositive power.
(4) Includes 2,539 shares held by Mr. Gilbert's child, 26,824 shares held
jointly with Mr. Gilbert's wife, 21,708 shares held by Mr. Gilbert's wife,
151,159 shares subject to employee stock options exercisable
3
<PAGE> 6
within 60 days after January 31, 1994 and 48,244 shares held in Mr.
Gilbert's account by the trustee of the Company's Profit Sharing Plan as to
which the trustee possesses sole voting power but as to Mr. Gilbert, by
virtue of allocating elections to various funds, possesses dispositive
power.
(5) Includes 6,036 shares held by Mr. Stockham's wife and 2,551 shares held in a
trust with respect to which Mr. Stockham possesses voting power.
(6) Includes 816 shares owned by Mr. Taylor's wife.
Of the directors named above, Messrs. Bradford, Hulsey and Malone were
elected at the 1992 Annual Meeting of Stockholders, and Messrs. Gilbert,
Stockham and Taylor were elected at the 1993 Annual Meeting of Stockholders, to
serve for the terms indicated.
Mr. Stockham is a director of The Southern Company, which has securities
registered under the Securities Exchange Act of 1934.
The Company has an Audit Committee of the Board of Directors, consisting of
Messrs. Stockham and Keesler, Jr., which recommends to the Board of Directors
the independent accountants to be selected as the Company's auditors and reviews
the audit plan, financial statements and audit results. The Audit Committee also
reviews the internal audit reports of the Company and its affiliates and reviews
comments from the affiliates as to exceptions noted in the reports. The Audit
Committee held four meetings during 1993. Mr. Stockham is Chairman of the Audit
Committee.
The Company has a Human Resources Committee of the Board of Directors,
consisting of Messrs. Harbert, Hulsey and Taylor, which sets compensation for
the executive officers of the Company and administers various employee benefit
plans of the Company. The Human Resources Committee held five meetings during
1993. Mr. Harbert is Chairman of the Human Resources Committee.
The Company does not have any Nominating Committee of the Board of
Directors. The functions of a Nominating Committee are filled by the Board of
Directors. Stockholders of the Company are required to give the Company advance
notice of any proposed nominee to the Board of Directors of the Company.
During the year ended December 31, 1993, the Board of Directors held five
regular and special meetings. Directors are paid $3,500 per calendar quarter and
$2,000 per meeting. All directors attended more than 75% of the meetings of the
Board of Directors (including any meetings of any committees thereof of which
they are members).
As of January 31, 1994, the executive officers and directors of the Company
as a group, consisting of 15 persons, owned beneficially 4,801,746 shares of
Common Stock of the Company, or approximately 6.0% of the total number of shares
of Common Stock outstanding. In addition to the stock ownership of Messrs.
Wallace D. Malone, Jr. and Roy W. Gilbert, Jr., which is listed above, Messrs.
Julian W. Banton, the Chief Executive Officer of SouthTrust Bank of Alabama,
N.A., Frederick W. Murray, Jr., the Executive Vice President of the Company, and
James W. Rainer, Jr., the Executive Vice President of the Company, beneficially
owned as of the same date, 120,031, 153,453, and 122,100 shares of Common Stock
of the Company, respectively, or approximately 0.15%, 0.19% and 0.15%,
respectively, of the total number of shares of Common Stock outstanding.
AMENDMENT TO THE RESTATED CERTIFICATE OF INCORPORATION
The Board of Directors of the Company has adopted a resolution recommending
that the first paragraph of Article FOURTH of the Restated Certificate of
Incorporation of the Company be amended to increase the authorized number of
shares of Common Stock from 150,000,000 shares, par value of $2.50 per share, to
200,000,000 shares, par value of $2.50 per share. Under the Restated Certificate
of Incorporation of the Company, the holders of the Common Stock are not
entitled to preemptive rights.
If the proposed amendment is adopted, the additional authorized shares may
be issued by the Board of Directors without any further action or approval by
the stockholders of the Company. The Company may issue the additional authorized
shares of Common Stock in connection with stock dividends or splits, employee
benefit plans, the acquisition of financial institutions and other entities or
the generation of additional capital
4
<PAGE> 7
for the Company. If the Company were to issue a significant number of the newly
authorized shares of Common Stock, it is possible that the ownership interest of
the current stockholders of the Company could be diluted and, depending upon the
circumstances of such issuance, it is possible that the earnings per share and
book value per share of the currently outstanding shares of Common Stock could
be diluted. As of the date of the Proxy Statement, the Company has no plans to
issue any shares of Common Stock, except that the Company in the past has issued
shares of Common Stock to fund employee benefit plans of the Company and has
engaged in the acquisition of financial institutions and, at any particular
time, including the date of the Proxy Statement, the Company is a party to one
or more agreements and/or letters of intent to acquire such institutions. The
Company expects these processes to continue in the future.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR THE PROPOSED AMENDMENT TO THE
RESTATED CERTIFICATE OF INCORPORATION TO INCREASE THE AUTHORIZED COMMON STOCK.
APPROVAL OF THE SENIOR OFFICER PERFORMANCE INCENTIVE PLAN
The Board of Directors of the Company has adopted and amended from time to
time the Senior Officer Performance Incentive Plan (which heretofore has been
and hereafter will be referred to as the "Incentive Plan"), a copy of which is
annexed to the Proxy Statement as Exhibit I. The stockholders of the Company are
being asked to approve and ratify the adoption by the Board of Directors of the
Incentive Plan, including the terms and conditions of the performance goals
under which compensation thereunder is to be paid to certain executives of the
Company and its subsidiaries.
The purpose of the Incentive Plan is to compensate executives of the
Company and its subsidiaries for performance that contributes significantly to
the success and profitability of the Company and enhances the return to the
stockholders of the Company. The Incentive Plan is administered by the Human
Resources Committee. Under the Incentive Plan, the Chairman of the Board of
Directors, the President, the Executive Vice Presidents and the
Secretary-Treasurer of the Company and the Chief Executive Officer of any
subsidiary of the Company are eligible for selection by the Human Resources
Committee to participate in the Incentive Plan. Pursuant to the Incentive Plan,
the Human Resources Committee, after consultation with the Chairman of the Board
of Directors and the President of the Company, selects the executives who will
participate in the Incentive Plan for the ensuing fiscal year and then
determines the award opportunities as well as the performance criteria that must
be met for such executives to obtain such awards; the Human Resources Committee,
acting in executive session and without participation of the Chairman of the
Board of Directors and the President of the Company, determines the award
opportunities and performance criteria for the Chairman of the Board of
Directors and the President of the Company. Award opportunities are expressed as
a percentage, or range of percentages, of each participant's annual base salary
as of the first day of the ensuing fiscal year and may vary for each participant
and from year to year, but in no event may the Human Resources Committee grant
an award to any participant under the Incentive Plan that would result in any
participant receiving under the Incentive Plan more than $1,000,000 for any
fiscal year. The performance criterion that must be met for each participant is
expressed as a dollar amount of net income, after taxes, of the Company or, if
appropriate, one of its subsidiaries. Criterion for each participant constitutes
confidential commercial or business information, the disclosure of which would
affect the Company adversely. For fiscal 1994, the Human Resources Committee has
determined that cash bonuses to be awarded participants under the Incentive Plan
will range from 15% to 60% of a participant's annual base salary. Given the
range of base salaries of participants in the Incentive Plan for 1994, the
maximum award that may be earned for 1994 by any participant under the Incentive
Plan is $378,000. The Incentive Plan provides that following the close of each
fiscal year of the Company, the Human Resources Committee shall determine the
relative performance of each participant by comparing the actual results of
operations of the Company or, if appropriate, one of the Company's subsidiaries,
for the year to the performance criterion that were assigned to each participant
by the Human Resources Committee. For 1994, the Human Resources Committee has
determined that an award shall be deemed to be earned by a participant only if
95% of a participant's performance criterion is achieved, the maximum award
shall be deemed to be earned if 105% of a participant's performance criterion is
achieved
5
<PAGE> 8
and incremental portions of the award shall be deemed to be earned if more than
95% but less than 105% of a participant's performance criterion is achieved.
As indicated above, the Incentive Plan was in effect during the last fiscal
year. The following tabulation reflects certain information respecting the
amounts of the awards that were received by the following persons under the
Incentive Plan during the last fiscal year:
<TABLE>
<CAPTION>
NAME AND POSITION DOLLAR VALUE OF AWARD NUMBER OF UNITS
--------------------------------- --------------------- ---------------
<S> <C> <C>
Wallace D. Malone, Jr., $ 363,000(1) N/A
Chief Executive Officer of the
Company
Roy W. Gilbert, Jr., 241,450(1) N/A
President of the Company
Julian W. Banton 160,600(1) N/A
President and Chief Executive
Officer,
SouthTrust Bank of Alabama,
N.A.
Frederick W. Murray, Jr., 82,350(1) N/A
Executive Vice President of the
Company
James W. Rainer, Jr. 76,950(1) N/A
Executive Vice President of the
Company
Executive Officer Group 1,040,850(1) N/A
Non-Executive Director Group (2) N/A
Non-Executive Officer Group (2) N/A
Employee Group (2) N/A
</TABLE>
- ---------------
(1) Represents payments made pursuant to the Incentive Plan to the persons
described above with respect to fiscal 1993. For fiscal 1994, the Human
Resources Committee has established award opportunities under the Incentive
Plan ranging from 15% to 60% of a participant's annual base salary for 1994.
For fiscal 1994, the maximum award opportunities established for the
Company's Chief Executive Officer and the four other most highly compensated
executive officers of the Company or its principal subsidiary are the same
as the maximum award opportunities established for such persons for fiscal
1993. Since the base salaries of these persons were increased slightly for
fiscal 1994, it is possible that payments made under the Incentive Plan,
assuming that the maximum award opportunities are earned, to such persons
for fiscal 1994 may increase.
(2) Non-executive officer directors of the Company and employees of the Company
and its subsidiaries who are not executive officers of the Company or the
chief executive officer of certain subsidiaries of the Company are not
eligible to receive awards pursuant to the Incentive Plan.
As indicated elsewhere in the Proxy Statement, the Human Resources
Committee is empowered to vary the award opportunities of any participant in the
Incentive Plan from year to year.
Under the Omnibus Budget Reconciliation Act of 1993 ("OBRA"), Congress has
limited to $1 million per year the tax deduction available to public companies
for certain compensation paid to designated executive officers. The proposed
regulations provide an exception from this limitation for certain
performance-based compensation, assuming that various requirements are met. The
Incentive Plan is designed to satisfy this exception for awards issued
thereunder. By approving and ratifying the Incentive Plan, the stockholders of
the Company shall be deemed to have approved the material terms and conditions
of the performance goals under which compensation is to be paid pursuant to the
Incentive Plan. Accordingly, if the Incentive Plan is
6
<PAGE> 9
approved and ratified by the stockholders of the Company, the Company
anticipates being entitled to deduct an amount equal to the taxable income
reportable by each participant in the Incentive Plan as a result of any award
made under such Incentive Plan. If the Incentive Plan is not approved and
ratified by the stockholders of the Company, no compensation will be payable by
the Company under the Incentive Plan with respect to fiscal 1994.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR THE PROPOSAL TO APPROVE AND
RATIFY THE SENIOR OFFICER PERFORMANCE INCENTIVE PLAN.
EXECUTIVE COMPENSATION
The Securities and Exchange Commission (the "Commission") has revised
certain of its regulations relating to the cash and equity-based executive
compensation, which revisions are designed to make such material easier to
understand and more useful to stockholders as well as to require certain
additional information, including stock performance graphs. The following
tables, graphs and other information provide details concerning such executive
compensation.
FIVE YEAR TOTAL STOCKHOLDER RETURN
The following indexed graph compares the Company's annual percentage change
in cumulative total stockholder return for the past five years with the
cumulative total return of the Standard and Poor's 500 Stock Index and the
Standard and Poor's Regional Bank Index. This presentation assumes that $100 was
invested in shares of the relevant issuers on December 31, 1988, and that
dividends received were immediately reinvested in additional shares. The graph
plots the value of the initial $100 investment at one-year intervals. For
purposes of constructing this data, the returns of each component issuer have
been weighted according to that issuer's market capitalization.
COMPARISON OF FIVE-YEAR CUMULATIVE TOTAL RETURN
SOUTHTRUST CORPORATION
(PERFORMANCE THROUGH DECEMBER 31, 1993)
<TABLE>
<CAPTION>
MEASUREMENT PERIOD SOUTHTRUST S&P REG.
(FISCAL YEAR COVERED) CORP. S&P 500 BANKS
<S> <C> <C> <C>
1988 100.00 100.00 100.00
1989 120.00 132.00 122.00
1990 89.00 127.00 87.00
1991 219.00 166.00 156.00
1992 228.00 179.00 199.00
1993 265.00 197.00 210.00
</TABLE>
7
<PAGE> 10
REPORT OF THE HUMAN RESOURCES COMMITTEE OF THE BOARD OF DIRECTORS
The Human Resources Committee of the Board of Directors of the Company
annually establishes the compensation of the executive officers of the Company
and its subsidiaries. In doing so, the Human Resources Committee's primary
objective is to ensure that the compensation programs for executives are
designed and administered to motivate executives to produce superior performance
for the Company and provide superior returns to stockholders of the Company.
An executive's base salary is established after a careful review of
competitive practices to ensure that the total compensation opportunity compares
favorably to similarly situated executives. A significant portion of an
executive's total compensation is variable and is based on short-term and
long-term performance of the Company. Short-term performance of the Company is
rewarded, in the case of the senior executive officers of the Company and
certain of its subsidiaries, by annual cash bonuses under the Incentive Plan
and, in the case of certain other executives of the Company and its
subsidiaries, by annual cash bonuses under a similar incentive plan, the amount
of which and the criterion for payment of which are established in advance by
the Human Resources Committee. The Stock Option Plan of the Company is the
principal mechanism for rewarding executives for the long-term performance of
the Company.
The following is a description of the compensation programs of the Company
and how each relates to the objectives outlined above.
Base Salary: The base salaries of the five highest paid executives of the
Company are listed in the Summary Compensation Table. The base salary of each
executive is reviewed annually by the Human Resources Committee. Each
executive's base pay is determined by considering the performance of the
individual as well as the executive's experience and total responsibility in
comparison to other executives within the Company and to executives with peer
institutions of comparable size. In doing so, the Human Resources Committee
seeks to ensure that the base pay of each executive is competitive with
comparable executives of peer institutions and to reward the executive for the
executive's performance and total contribution to the success of the Company. In
determining each executive's base salary, the Human Resources Committee assigns
greater weight to an executive's experience, total responsibility and
performance than to the base salaries of comparable executives of peer
institutions.
As part of this process, the Human Resources Committee reviews a number of
salary surveys produced by compensation consulting firms. In addition, in
considering compensation for 1993, the Human Resources Committee commissioned a
national consulting firm to conduct a complete analysis of executive
compensation. In terms of base salaries, the study indicated that the base
salaries of the executives of the Company listed in the Summary Compensation
Table, when compared to peer institutions, approximated the average base salary
for executives of such institutions.
The Human Resources Committee considers the Company's peer institutions to
be southeastern banks and bank holding companies with total assets ranging from
$6 to $20 billion, some of which are included in the Standard and Poor's
Regional Bank Index used in the above performance graph. These peer institutions
were selected because they are comparable in size to the Company and are located
within the Company's operating region. In establishing the 1993 base salaries
for the executives listed in the Summary Compensation Table, the Human Resources
Committee considered the base salary of each such executive, the performance and
experience of each such executive and the base salaries reported by the peer
institutions for comparable executives. Comparing the Company only to
institutions of its approximate size and without any regard for any other
variable, the study by the consultant indicated that the base salaries of the
Company's executives were at approximately the 65th percentile of the array of
base salaries reported by such institutions.
Incentive Plans: The incentive plans of the Company are designed to reward
executives annually for achieving the after-tax net income and other goals of
the Company for the preceding fiscal year. Upon completion of the business plan
for the forthcoming fiscal year, the Chief Executive Officer of the Company
presents to the Human Resources Committee for its approval the net income goal
of the Company on a consolidated basis and the net income goals of the various
subsidiaries of the Company.
8
<PAGE> 11
With respect to the senior executive officers of the Company and the chief
executive officers of certain of its operating subsidiaries, the potential
incentive award for each executive is dependent upon each executive's level of
responsibility and the judgement of the Human Resources Committee of the
executive's potential contribution to the achievement of the particular net
income goals. For 1993, the range of awards for all of the senior executives of
the Company and the chief executive officers of certain of its operating
subsidiaries was between 15% and 60% of the executive's annual base salary, with
each individual executive being assigned minimum, maximum and target awards. An
executive whose award is based upon a net income goal earns an award only if 95%
of the goal is achieved, earns incremental percentages of the award if more than
95% but less than 105% of the goal is achieved and earns the maximum award if
105% of the goal is achieved. With respect to certain other executive officers
of the Company and its operating subsidiaries, the awards established by the
Human Resources Committee may take into account, in addition to net income
goals, certain other operating goals of the Company or its subsidiaries.
In the consultant's study referred to above, the short-term incentive
opportunities of the Company's executives were significantly below the
short-term opportunities of similarly situated executives in peer institutions.
In light of this study, the Human Resources Committee adjusted the award levels
for 1993 from 15% to 60% of an executive's base salary (as opposed to the award
levels of 15% to 45% of base salary that existed during 1992).
The amounts awarded the Company's five highest paid executives under the
Senior Officer Performance Incentive Plan for 1993 are set forth in the Annual
Compensation Bonus column of the Summary Compensation Table.
As indicated elsewhere in the Proxy Statement, the Incentive Plan is being
submitted to the stockholders of the Company for approval and ratification. One
effect of such approval will be to preserve the deductibility for federal income
tax purposes and under OBRA for amounts paid to executives under the Incentive
Plan. The Committee has recommended to the Board of Directors, and intends to
continue to recommend to the Board of Directors in the future, that it take
appropriate steps to qualify compensation payable to its executives for
deductibility under the federal income tax laws.
Stock Options: Stock options are the Company's principal long-term
incentive plan. The Human Resources Committee believes that stock options
encourage and reward management decisions that result in the long-term success
of the Company.
The value of stock options is dependent upon an appreciation in the value
of the underlying shares of Common Stock. The Human Resources Committee believes
stock options motivate and reward executives by including them within the
ownership base of the Company. In addition, to encourage a long-term
perspective, options have a ten-year exercise period, and options cannot be
exercised before a one-year period has elapsed from grant date.
The number of options awarded to each executive is tied to the executive's
level of responsibility which means that senior executives typically receive
awards to purchase more shares of stock than other executive officers. In making
awards each year, the Human Resources Committee takes into consideration, in
addition to the seniority and level of responsibility of the executive, the
previous grants to such executive.
The consultant's study referred to above indicated that the stock option
awards of the Company's executives are conservative when compared to the award
opportunities that have been reported by the Company's peer institutions.
The Company also maintains the 1990 Discounted Stock Plan, which is
available to all employees including executives who have at least five years of
service with the Company. For a discussion of the 1990 Discounted Stock Plan,
see the information set forth under the heading "Stock Options and Other Stock
Purchase Rights" in the Proxy Statement. Awards under the 1990 Discounted Stock
Plan have not been used extensively by the Human Resources Committee as a
vehicle for executive compensation.
9
<PAGE> 12
Chief Executive Officer Compensation: The Human Resources Committee meets
in executive sessions to review the Chief Executive Officer's salary and
periodically engages independent consultants to advise the Human Resources
Committee on its competitors' practices.
The 1993 base salary for the Chief Executive Officer was established after
a review of an analysis provided by the independent consultant described above
of the base salaries of comparable executives of the peer institutions described
above. This analysis contained information on all components of the Chief
Executive's compensation. After reviewing the data and considering the Company's
sustained performance and substantial asset growth and the Chief Executive
Officer's experience and level of responsibility, the Human Resources Committee
established the Chief Executive Officer's base salary for 1993. The Human
Resources Committee believes that the Chief Executive Officer's base salary for
1993 is at an appropriate level when compared, among other things, to the base
salary of comparable executives at peer institutions.
As a result of the analysis for 1993, the target and maximum award
opportunities for the Company's Chief Executive Officers under the Incentive
Plan were increased. Specifically, the Chief Executive Officer's target award
for achieving the net income goal of the Company for 1993 was 55% (as compared
to 40% for 1992) and the maximum award was 60% (as compared to 45% for 1992). In
1993, the Company's net income exceeded the goal established by the Human
Resources Committee for the Chief Executive Officer, resulting in a bonus of 60%
of base salary being paid to the Chief Executive Officer.
During 1993, the Chief Executive Officer also was granted options to
purchase 66,000 shares of Common Stock.
The members of the Human Resources Committee are as follows:
Bill L. Harbert, Chairman
William C. Hulsey
Charles G. Taylor
Compensation Committee Interlocks and Insider Participation in Compensation
Decisions. None of the members of the Human Resources Committee has served as
officers of the Company. In addition, none of the Human Resources Committee
members has any other relationship to the Company, except that Bill Harbert
International Construction, Inc., a corporation of which Mr. Bill L. Harbert is
the principal stockholder and the Chief Executive Officer ("Harbert
International"), is in process of negotiating (but as of the date hereof has not
executed) an agreement with SouthTrust Bank of Alabama, N.A., a subsidiary of
the Company ("SouthTrust Bank"), pursuant to which Harbert International will
construct a service center for SouthTrust Bank. It is contemplated that the
facilities comprising the service center will cover approximately 218,000 square
feet and will be completed within 18 months of the date that construction is
commenced.
10
<PAGE> 13
SUMMARY COMPENSATION TABLE
The following Summary Compensation Table sets forth the information
concerning compensation for services in all capacities, including cash and
non-cash compensation, awarded to, earned by or paid to the Company's Chief
Executive Officer and the four other most highly compensated executive officers
of the Company or its principal subsidiary in each of the last three fiscal
years, unless otherwise noted:
<TABLE>
<CAPTION>
LONG TERM COMPENSATION
---------------------------------
AWARDS
----------------------- PAYOUTS
ANNUAL COMPENSATION(1) RESTRICTED -------
--------------------------- OTHER ANNUAL STOCK OPTIONS LTIP ALL OTHER
NAME AND PRINCIPAL BONUS COMPENSATION AWARD(S) (NUMBER OF PAYOUTS COMPENSATION
POSITION(1) YEAR SALARY($) ($)(2) ($)(3) ($) SHARES) ($) ($)
- ---------------------------- ---- --------- -------- ------------ ---------- ---------- ------- ------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Wallace D.Malone, Jr., 1993 $605,016 $363,000 $ 20,121 N/A 32,266(4) N/A $ 59,770(5)
Chief Executive Officer 1992 565,008 254,250 18,305 N/A 34,827(4) N/A 58,661
of the Company 1991 515,016 231,750 * N/A 76,609(4) N/A *
Roy W. Gilbert, Jr., 1993 $439,032 $241,450 $ 14,841 N/A 23,411(4) N/A $ 43,403(5)
President of the Company 1992 414,024 165,600 13,501 N/A 25,518(4) N/A 43,023
1991 377,520 151,000 * N/A 56,154(4) N/A *
Julian W. Banton, 1993 $292,000 $160,600 $ 5,152 N/A 11,679(4) N/A $ 28,836(6)
President and Chief 1992 267,000 93,450 4,821 N/A 12,342(4) N/A 27,705
Executive Officer of 1991 247,008 86,450 * N/A 27,555(4) N/A *
SouthTrust Bank of
Alabama, N.A.
Frederick W. Murray, Jr., 1993 $183,000 $ 82,350 $ 5,954 N/A 7,319(4) N/A $ 18,158(6)
Executive Vice President 1992 172,800 60,480 3,839 N/A 7,987(4) N/A 18,032
of the Company 1991 163,800 57,330 * N/A 18,274(4) N/A *
James W. Rainer, Jr. 1993 $171,000 $ 76,950 $ 4,099 N/A 6,839(4) N/A $ 16,971(6)
Executive Vice President 1992 161,000 56,350 5,571 N/A 7,443(4) N/A 16,805
of the Company 1991 143,000 50,050 * N/A 15,952(4) N/A *
</TABLE>
- ---------------
* Information under these columns is not required for the year 1991.
(1) Although each person received perquisites or other personal benefits in the
years shown, the value of these benefits did not exceed in the aggregate
the lesser of $50,000 or 10% of such person's salary and bonus in any year.
(2) Represents amounts paid to each executive officer under the Senior Officer
Performance Incentive Plan.
(3) Represents life insurance premiums and additional taxes owed on the
additional compensation paid by the Company on behalf of each executive
officer.
(4) Adjusted for 3 for 2 stock split that occurred on May 19, 1993.
(5) Includes $30,000 for Mr. Malone and $20,000 for Mr. Gilbert, which amounts
were withheld by the Company from deferred compensation due Messrs. Malone
and Gilbert in 1993 in order to defray the costs of the Company agreeing to
pay Messrs. Malone and Gilbert an annual sum certain, commencing at the age
of 60 and continuing for the greater of their lifetime or 15 years, and
includes payments by the Company to defined contribution plans maintained
by the Company (including qualified and nonqualified compensation plans).
(6) Represents payments by the Company to defined contribution plans maintained
by the Company (including qualified and nonqualified compensation plans) on
behalf of the executive officers.
STOCK OPTIONS AND OTHER STOCK PURCHASE RIGHTS
The Company has adopted the 1984 Stock Option Plan and the 1993 Stock
Option Plan (the "Stock Option Plans") pursuant to which the Company grants to
key employees of the Company either incentive stock options ("ISO's") or
nonqualified stock options ("NQSO's") and the 1990 Discounted Stock Plan (the
"Discounted Plan") pursuant to which awards to purchase shares of Common Stock
of the Company at a discount are made to eligible employees, including executive
officers of the Company.
The grant of stock options pursuant to the Stock Option Plans is, and will
be, made subject to the following limitations: (i) the option price will be not
less than 100% of the fair market value of the Common Stock on the date of the
grant; (ii) no option may be exercised after ten years from the date of the
grant; and (iii) such other conditions as the Human Resources Committee, which
administers the Stock Option Plans,
11
<PAGE> 14
may determine. A total of 4,603,656 shares of Common Stock of the Company is
available for issuance under the Stock Option Plans.
The Discounted Plan was established in order to give all employees an
opportunity to acquire equity interest in the Company at a discount (17.5%) to
market, and awards are made to all employees (including executive officers) who
have completed five years full-time service to the Company. A total of 1,125,000
shares of Common Stock of the Company is reserved for issuance under the
Discounted Plan. All full time and permanent part time employees of the Company
or any subsidiary of the Company who have completed five years of service are
eligible to participate in the Discounted Plan. Pursuant to the Discounted Plan,
the Human Resources Committee is authorized to grant annual awards of Common
Stock with respect to each eligible employee the aggregate purchase price of
which cannot exceed 10% of the annual salary of such employee. Because of these
limitations, these awards are usually for a relatively small number of shares of
Common Stock and are not intended to be a significant part of an employee's
compensation. An employee may elect to accept all or any portion of the shares
of Common Stock constituting the award, but if any shares at all are to be
accepted by the employee, a minimum of ten shares of Common Stock must be so
accepted. The stock purchase price for such shares is a price equal to the last
sales price of the Common Stock of the Company, as reported by the National
Association of Securities Dealers, Inc. Automated Quotation System - National
Market System, on the date on which an employee elects to accept the award in
question, less a discount of 17.5%. All eligible employees who accept awards
under the Discounted Plan are required to hold shares of Common Stock for a
period of three years, unless such transfer is effected in connection with a
death, disability, retirement or other termination of employment of the
employee. If the employee's employment is terminated prior to the end of such
three-year period, the Company has the option to purchase the shares of Common
Stock in question in exchange for a purchase price equal to the original
purchase price paid by the employee.
The following table sets forth information concerning grants of stock
options during fiscal year 1993 to each executive officer listed below:
OPTION GRANTS IN LAST FISCAL YEAR
INDIVIDUAL GRANTS
<TABLE>
<CAPTION>
POTENTIAL
REALIZABLE VALUE
ASSUMING RATES
% OF TOTAL OF STOCK
OPTIONS OPTIONS EXERCISE PRICE APPRECIATION
GRANTED GRANTED OR BASE OF
(NUMBER OF EMPLOYEES PRICE EXPIRATION -------------------
NAME SHARES)* IN 1993 ($/SH) DATE 5%** 10%**
- ---------------------------------- ---------- ---------- -------- ---------- -------- --------
<S> <C> <C> <C> <C> <C> <C>
Wallace D. Malone, Jr............. 32,266 14.99% $18.75 1/20/2003 $380,473 $964,194
Roy W. Gilbert, Jr................ 23,411 10.88% 18.75 1/20/2003 276,057 699,583
Julian W. Banton.................. 11,679 5.43% 18.75 1/20/2003 137,716 349,000
Frederick W. Murray, Jr........... 7,319 3.40% 18.75 1/20/2003 86,304 218,711
James W. Rainer, Jr............... 6,839 3.18% 18.75 1/20/2003 80,644 204,368
</TABLE>
- ---------------
* Does not include awards during 1993 under the Discounted Plan to Messrs.
Malone, Gilbert, Banton, Murray and Rainer to purchase 3,962, 2,875, 1,912,
1,198 and 1,119 shares of Common Stock, respectively, at a 17.5% discount to
the then market price of such shares; during 1993, none of such persons
purchased any shares of Common Stock under the Discounted Plan.
** These numbers are calculated by comparing the exercise price of such options
and the market value of the shares of Common Stock subject to such options,
assuming that the market price of such shares increase by 5% and 10%,
respectively, during each year that the options are exercisable.
12
<PAGE> 15
The following table sets forth the number of stock options exercised and
the dollar value realized thereon by each of the executives listed below during
1993, along with the number and dollar value of any options remaining
unexercised at year end:
AGGREGATED OPTION EXERCISES IN 1993
AND DECEMBER 31, 1993 OPTION VALUES
<TABLE>
<CAPTION>
VALUE OF
NUMBER OF UNEXERCISED
SHARES UNDERLYING IN-THE-MONEY
OPTIONS AT OPTIONS AT
NUMBER OF DECEMBER 31, 1993 DECEMBER 31, 1993
SHARES ACQUIRED EXERCISABLE/ EXERCISABLE/
NAME ON EXERCISE VALUE REALIZED UNEXERCISABLE(1) UNEXERCISABLE(1)
- ----------------------------------- ---------------- -------------- ----------------- -----------------
<S> <C> <C> <C> <C>
Wallace D. Malone, Jr.............. 0 0 107,630/0 $ 587,540/0
Roy W. Gilbert, Jr................. 20,000 $238,056 151,159/0 1,245,781/0
Julian W. Banton................... 2,248 28,443 82,958/0 783,242/0
Frederick W. Murray, Jr............ 2,013 25,218 67,472/0 662,258/0
James W. Rainer, Jr................ 0 0 63,478/0 626,204/0
</TABLE>
- ---------------
(1) Includes options exercisable within 60 days of December 31, 1993. As of such
date, all options held by the persons named in the above table were
exercisable.
EXECUTIVE EMPLOYMENT AGREEMENTS
The Company is a party to employment agreements with Messrs. Wallace D.
Malone, Jr., and Roy W. Gilbert, Jr. These employment agreements provide for the
employment of the executive in question in a capacity at least equal to the
capacity in which the executive was serving as of October 1984 for a term
commencing as of October 19, 1984 and ending on December 31, 1993, unless the
executive (if eligible) elects early retirement. The employment agreements also
provide that on December 31 of each year subsequent to 1987 the term of
employment thereunder is automatically renewed for an additional period of one
year, thus resulting in the term of employment under the employment agreements,
except when the executive attains 65 years of age, always being at least five
years, and provide further that if the executive is terminated for any reason
other than his death or disability or for cause, which is defined in the
employment agreements as certain acts of dishonesty and certain acts competitive
with the Company, the executive is entitled to receive annual payments at the
rate in effect immediately prior to such termination of employment for a period
of five years.
RETIREMENT PLAN
The Company maintains a Retirement Income Plan (the "Retirement Plan")
which is a noncontributory, defined benefit plan and covers all employees who
have been in the employ of the Company or one of its subsidiaries for more than
one year.
The Retirement Plan provides generally for an annual benefit commencing at
age 65 equal to 1.55% of the employee's average base compensation during the
highest five consecutive years of the fifteen years preceding retirement, less
1.25% of primary Social Security benefits in effect at the time of retirement,
for each year of credited service. The Company also maintains a Supplementary
Retirement Plan for certain executives, and since 1987, all of the contributions
of the Company with respect to Messrs. Malone and Gilbert were made under the
Supplementary Retirement Plan.
The following table shows the annual pension benefits under the Retirement
Plan and the Supplementary Retirement Plan for retirement at age 65 based upon
various salaries and years of service. The effects of integration with Social
Security benefits have been excluded from the table, because the amount of
reduction in benefits due to integration varies depending on the employee's age
at the time of retirement and changes in the Social Security laws.
13
<PAGE> 16
PENSION PLAN TABLE
<TABLE>
<CAPTION>
YEARS OF SERVICE
--------------------------------------------------------------------
REMUNERATION 15 YEARS 20 YEARS 25 YEARS 30 YEARS 35 YEARS
- ------------------------ -------- -------- -------- -------- --------
<S> <C> <C> <C> <C> <C>
$125,000................ 29,063 38,750 48,438 58,125 67,813
150,000................ 34,875 46,500 58,125 69,750 81,375
175,000................ 40,688 54,250 68,813 81,375 94,938
200,000................ 46,500 62,000 77,500 93,000 108,500 *
225,000................ 52,313 69,750 87,188 104,625 * 122,063 *
250,000................ 58,125 77,500 96,875 116,250 * 135,625 *
300,000................ 69,750 93,000 116,250 * 139,500 * 162,750 *
400,000................ 93,000 124,000 * 155,000 * 186,000 * 217,000 *
450,000................ 104,625 * 139,500 * 174,375 * 209,250 * 244,125 *
500,000................ 116,250 * 155,000 * 193,750 * 232,500 * 271,250
</TABLE>
- ---------------
* Under the Employee Retirement Income Security Act of 1974, the maximum pension
benefit under the Retirement Plan is subject to certain limitations, which,
while varying in some cases, generally is $102,582. As indicated above, the
Company maintains a Supplementary Retirement Plan which supplements the
benefits payable to certain executive officers.
Current base salary figures of the Chief Executive Officer and the other
executive officers of the Company are set forth in the Summary Compensation
Table. As of December 31, 1993, credited years of service for each such
executive officer are as follows: Mr. Malone -- 35 years; Mr. Gilbert -- 35
years; Mr. Banton -- 11 years; Mr. Murray -- 29 years; and Mr. Rainer -- 29
years.
COMPLIANCE WITH SECTION 16(A) OF
THE SECURITIES AND EXCHANGE ACT OF 1934
The Company's executive officers, directors and 10% stockholders are
required under the Securities Exchange Act of 1934 to file reports of ownership
and changes in ownership with the Commission. Copies of these reports must also
be furnished to the Company.
Based solely on a review of copies of such reports furnished to the Company
through the date hereof, or written representations of such officers, directors
or stockholders that no reports were required, the Company believes that during
1993 all filing requirements applicable to its officers, directors and
stockholders were complied with in a timely manner.
TRANSACTIONS WITH MANAGEMENT
Directors and executive officers of the Company and their associates were
customers of and/or had transactions with the banks and other entities which are
subsidiaries of the Company in the ordinary course of business during the year
ended December 31, 1993, and may continue to do so in the future. All
outstanding loans and commitments included in such transactions were made on
substantially the same terms, including interest rates and collateral, as those
prevailing at the time for comparable transactions with other persons, and did
not involve more than normal risks of collectability or present other
unfavorable features. For information regarding a proposed agreement between a
subsidiary of the Company, and a corporation of which, Mr. Bill L. Harbert, a
director of the Company, is the principal stockholder and the Chief Executive
Officer, see "EXECUTIVE COMPENSATION -- Report of the Human Resources Committee
of the Board of Directors."
AUDITORS
Arthur Andersen & Co., independent accountants, have been engaged as the
Company's auditors since 1989 and will continue to serve as the Company's
auditors during 1994. Representatives of Arthur Andersen &
14
<PAGE> 17
Co. will be in attendance at the Annual Meeting and will be available to respond
to questions from stockholders.
STOCKHOLDER PROPOSALS
Stockholder proposals submitted for consideration at the next Annual
Meeting of Stockholders must be received by the Company no later than December
21, 1994, to be included in the 1995 proxy materials.
GENERAL INFORMATION
As of the date of this Proxy Statement, the Board of Directors does not
know of any other business to be presented for consideration or action at the
Annual Meeting, other than that stated in the notice of the Annual Meeting. If
other matters properly come before the Annual Meeting, the persons named in the
accompanying form of proxy will vote thereon in their best judgment.
BY ORDER OF THE BOARD OF DIRECTORS
SOUTHTRUST CORPORATION
AUBREY D. BARNARD
Secretary
Birmingham, Alabama
March 9, 1994
15
<PAGE> 18
EXHIBIT I
AMENDED AND RESTATED SENIOR OFFICER
PERFORMANCE INCENTIVE PLAN
OF
SOUTHTRUST CORPORATION
This Senior Officer Performance Incentive Plan, as amended and restated as
of the day of , 19 , of SOUTHTRUST CORPORATION, a Delaware
corporation with its principal place of business in Birmingham, Alabama.
WITNESSETH:
WHEREAS, the Board of Directors of SouthTrust Corporation has established
and maintained for several years the Senior Officer Performance Incentive Plan
of SouthTrust Corporation; and
WHEREAS, the Senior Officer Performance Incentive Plan is intended to
compensate and reward executive officers of SouthTrust Corporation and certain
of its subsidiaries for excellent job performance which contributes to the
success, profitability, and return to the stockholders of SouthTrust
Corporation; and
WHEREAS, the Board of Directors of SouthTrust Corporation previously has
made amendments to the Senior Officer Performance Incentive Plan and hereby
desires to amend and restate the Senior Officer Performance Incentive Plan.
NOW, THEREFORE, the Board of Directors of SouthTrust Corporation hereby
amends and restates the Senior Officer Performance Incentive Plan as follows:
1. DEFINITIONS.
1.1 "Board" means the Board of Directors of SouthTrust.
1.2 "Code" means the Internal Revenue Code of 1986, as amended
1.3 "Compensation" means the base salary paid to Senior Officers.
1.4 "Committee" means the Human Resources Committee of the Board.
1.5 "Fiscal Year" means the calendar year.
1.6 "Participant" means a Senior Officer who has been designated for
participation in the Plan by the Committee in accordance with Section 3 of the
Plan and who has commenced participation in the Plan.
1.7 "Participating Employer" means any corporation or other entity (other
than SouthTrust), which is a member of an "affiliated group," as such term is
defined in Section 1504 of the Code, in which SouthTrust also is a member.
1.8 "Performance Agreement" means the written notice described in Section
3.2 of the Plan, executed by an executive officer of SouthTrust and transmitted
on behalf of the Committee by SouthTrust to each Participant, setting forth the
terms and conditions of each Participant's participation in the Plan.
1.9 "Plan" means the Amended and Restated Senior Officer Performance
Incentive Plan of SouthTrust Corporation established by this document, as
amended from time to time, and any related Performance Agreements.
1.10 "Senior Officer" means, unless otherwise indicated by the context,
(i) those persons who are full-time employees of SouthTrust and who are serving
as the Chairman, President, Executive Vice Presidents or Secretary-Treasurer of
SouthTrust and (ii) that person who is a full-time employee of each
Participating Employer and who is serving as the Chief Executive Officer of each
such Participating Employer.
1
<PAGE> 19
1.11 "SouthTrust" means SouthTrust Corporation, a corporation organized
and existing under the laws of the State of Delaware, with its principal place
of business in Birmingham, Alabama, and any assign or successor thereto, whether
by merger, consolidation, sale of assets, liquidation or otherwise.
2. PURPOSE.
The Plan is intended to motivate Participants to render superior service to
SouthTrust and its subsidiaries and for achieving certain performance goals and
criteria established by the Committee.
3. PARTICIPATION.
3.1 Selection to Participate. Upon recommendation from the Chairman and
the President of SouthTrust, the Committee, prior to the close of each Fiscal
Year, may designate in writing one or more Senior Officers as persons eligible
to participate in the Plan during the next succeeding Fiscal Year, except that
in the case of the Fiscal Year ending December 31, 1994, the Committee may make
such designation prior to April 1, 1994.
3.2 Designation of Award and Performance Criteria. Prior to the close of
each Fiscal Year, the Committee shall approve and establish, and shall request
that SouthTrust, on its behalf, communicate in writing to each Senior Officer
who is to be a Participant in the Plan during the next succeeding Fiscal Year,
the terms and conditions of each such Participant's participation in the Plan
for the next succeeding Fiscal Year, including the award that each such
Participant will be eligible to earn during such Fiscal Year (which shall be
expressed as a percentage of each such Participant's annual compensation as of
the first day of such Fiscal Year and shall specify a minimum, maximum and
target award for each such Participant) and the performance criterion that must
be achieved in order for each such Participant to earn such award (which, if the
Participant is a Senior Officer of SouthTrust, shall be expressed as a dollar
amount of net income, after taxes, of SouthTrust on a consolidated basis for
such Fiscal Year or, if the Participant is a Senior Officer of any Participating
Employer, a dollar amount of net income, after taxes, of such Participating
Employer on a consolidated basis for such Fiscal Year, determined, in each case,
in accordance with generally accepted accounting principles, applied on a basis
consistent with prior periods, and which shall state the circumstances under
which each such Participant shall be deemed to earn the minimum, maximum, target
or any other amount of any such award); provided, however, that with respect to
participation in the Plan for the Fiscal Year ending December 31, 1994, the
foregoing process shall be completed by the Committee prior to April 1, 1994,
and, provided further, that in no event shall the Committee grant any
Participant under the Plan an award that could result in such Participant
earning an amount under the Plan greater than $1,000,000 with respect to any
Fiscal Year. In establishing the award and performance criteria of Participants
in the Plan, the Committee shall consider the Participant's level of
responsibility with SouthTrust or any Participating Employer and the
Participant's potential contribution to the net income goals of SouthTrust or
such Participating Employer; in establishing the award and performance criterion
of any Participant other than the Chairman and the President of SouthTrust, the
Committee shall solicit the recommendation of the Chairman and the President of
SouthTrust.
4. PAYMENT OF AWARDS.
4.1 Calculation of Award Payments. Within sixty (60) days following the
close of each Fiscal Year in which a Participant is participating in the Plan,
the Committee shall compare the terms and conditions of the award of each
Participant and the performance criterion assigned to each such Participant to,
if the Participant is a Senior Officer of SouthTrust, the net income, after
taxes, of SouthTrust on a consolidated basis for such Fiscal Year or, if the
Participant is a Senior Officer of any Participating Employer, the net income,
after taxes, of such Participating Employer on a consolidated basis for such
Fiscal Year, determined, in each case, in accordance with generally accepted
accounting principles, applied on a basis consistent with prior periods.
Following such determination, and prior to the payment of awards pursuant to
Section 4.2 below, the Committee shall certify in writing to each Participant
and to the Board of Directors of SouthTrust (and, if appropriate, the Board of
Directors of any Participating Employer) whether each Participant has met the
terms and conditions of the award for the Fiscal Year in question.
2
<PAGE> 20
4.2 Payment of Award Amounts. All awards determined to have been earned
pursuant to Section 4.2 of the Plan, adjusted as contemplated by Section 4.3
below, shall be payable in cash, as soon as administratively possible following
the certification described in Section 4.1 above, but in no event later than
seventy-five (75) days following the close of the Fiscal Year to which such
award related.
4.3 Effect of Discretionary Bonuses. As may be consistent with the
business objectives of SouthTrust, the Committee, in its discretion, and,
subject to approval of the Board, may elect to pay a discretionary bonus to any
Participant in the Plan prior to the end of any Fiscal Year, which discretionary
bonus, at the discretion of and as specified by the Committee, may or may not
reduce any award that may be earned by any such Participant under the Plan for
such Fiscal Year. In the event that any such bonus is paid prior to the end of
any Fiscal Year, and in the event that the Committee determines that such bonus
is to reduce any award that may be earned by any Participant under the Plan,
such bonus, or any award payable under the Plan following the end of such Fiscal
Year, shall be reduced appropriately to reflect the time value of money, any
award payable under the Plan following the end of such Fiscal Year shall be
reduced by the amount of such discretionary bonus, and in the event that any
award payable to any Participant under the Plan for such Fiscal Year is less
than the amount of such discretionary bonus, such Participant shall be obligated
to repay the amount of such discretionary bonus to SouthTrust or any
Participating Employer, as may be the case, plus interest accrued thereon from
the date of payment of such discretionary bonus at a rate equal to the prime
rate of interest that existed at SouthTrust Bank of Alabama, N.A. as of the date
of payment of such discretionary bonus.
4.4 Effect of Termination of Employment on Payment of Award. In the event
the employment of a Participant terminates at any time prior to the close of the
Fiscal Year for which an award has been made for any reason, including, without
limitation, death, disability or normal or early retirement, participation in
this Plan shall end and no amount shall be payable under the terms of this Plan.
5. ADMINISTRATION.
5.1 Powers and Duties. The Plan shall be administered by the Committee and
the Committee shall have the power and duty to:
(a) construe and interpret the provisions of the Plan;
(b) adopt, amend, or revoke rules and regulations for the
administration of the Plan, provided they are not inconsistent with the
provisions of the Plan;
(c) appoint and retain such persons as may be necessary to carry out
the functions of the Administrator; and
(d) take such other action as may reasonably be required to administer
the Plan in accordance with its terms or as may be provided for or required
by law.
6. MISCELLANEOUS.
6.1 Amendment or Termination. The Plan may be amended or terminated at any
time by SouthTrust with respect to any or all Participants by written instrument
executed by an officer of SouthTrust thereunto duly authorized by the Board.
6.2 Governing Law. Except as provided under federal law, the provisions of
the Plan shall be governed by and construed in accordance with the laws of the
State of Alabama.
6.3 Right to Employment. This Agreement shall not be construed as giving
the Participant any right to continued employment with SouthTrust.
6.4 Entire Agreement. This Plan, as completed and executed by SouthTrust,
the Participation Agreements, and all amendments thereto, will constitute the
entire agreement between SouthTrust and Participants regarding the Plan.
3
<PAGE> 21
6.5 Captions. The captions or headings in this Agreement are made for
convenience and general reference only and shall not be construed to describe,
define, or limit the scope or intent of the provisions of this Agreement.
IN WITNESS WHEREOF, SouthTrust, by and through its duly authorized
officers, has caused this instrument to be executed under seal on the day of
, 19 .
SOUTHTRUST CORPORATION
By:
--------------------------------------
Its:
--------------------------------------
ATTEST:
- ------------------------------------------ (SOUTHTRUST)
Aubrey D. Barnard
Secretary
4
<PAGE> 22
SOUTHTRUST CORPORATION (LOGO)
P.O. BOX 2554
BIRMINGHAM, ALABAMA 35290
<PAGE> 23
SOUTHTRUST CORPORATION
BIRMINGHAM, ALABAMA
PROXY FOR THE ANNUAL MEETING OF STOCKHOLDERS
APRIL 20, 1994
(THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS OF THE COMPANY)
The undersigned hereby appoints J. Reese Murray and William O. Vann, and each
of them, with full power of substitution, proxies to vote the shares of Common
Stock of SouthTrust Corporation (the "Company") which the undersigned could vote
if personally present at the Annual Meeting of Stockholders of the Company to be
held in the auditorium on the eighth floor of the SouthTrust Tower, 420 North
20th Street, Birmingham, Alabama, on April 20, 1994, at 9:00 A.M., Central Time,
or any adjournment thereof:
<TABLE>
<S> <C> <C> <C> <C> <C>
1. ELECTION OF DIRECTORS: / / FOR all nominees below / / WITHHOLD AUTHORITY to vote for all
(except as indicated to the nominees below
contrary below)
Bill L. Harbert, Allen J. Keesler, Jr., T. W. Mitchell, William K. Upchurch, Jr.
INSTRUCTION: To withhold authority to vote for an individual nominee, write that nominee's name in the space provided
below.
------------------------------------------------------------------------------------------------------------
2. AMENDMENT OF RESTATED CERTIFICATE OF INCORPORATION:
The proposal to amend the Restated Certificate of Incorporation of the Company to increase the number of shares of
authorized Common Stock of the Company from 150,000,000 to 200,000,000 shares, as described in more detail in the Proxy
Statement of the Company dated March , 1994.
/ / FOR / / AGAINST / / ABSTAIN
(Continued and to be dated and signed on reverse side)
(Continued from front)
3. APPROVAL AND RATIFICATION OF THE INCENTIVE PLAN:
The proposal to approve and ratify the Senior Officer Performance Incentive Plan of the Company, as described in more
detail in the Proxy Statement of the Company dated March , 1994.
/ / FOR / / AGAINST / / ABSTAIN
4. OTHER MATTERS:
In their discretion, upon such other matters as may properly come before the Annual Meeting of the Stockholders.
</TABLE>
THIS PROXY WILL BE VOTED IN ACCORDANCE WITH YOUR INSTRUCTIONS, AND IF NO
INSTRUCTIONS ARE GIVEN, THIS PROXY WILL BE VOTED FOR THE ELECTION OF THE PERSONS
NOMINATED BY THE BOARD OF DIRECTORS AS DIRECTORS AND FOR PROPOSALS 2 AND 3.
Dated:
------------------------------
------------------------------
------------------------------
------------------------------
(Signature(s) of
Stockholder(s))
(Please date and sign as
name appears on proxy. If
shares are held jointly, each
stockholder should sign.
Executors, administrators,
trustees, etc. should use full
title and, if more than one,
all should sign. If the
stockholder is a corporation,
please sign full corporate
name by authorized officer.)
