<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:
/X/ Preliminary Proxy Statement
/ / 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):
/X/ $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.
/ / 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:
<PAGE> 2
SOUTHTRUST CORPORATION
420 NORTH 20TH STREET
BIRMINGHAM, ALABAMA
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___, 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 __, 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 and (iii) the record
holder has indicated that it does not have authority to vote such shares on
that matter)
<PAGE> 4
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 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
such vote.
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:
2
<PAGE> 5
<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, Bill 0.76%
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, Stuart 0.69%
Construction Co., Inc. (construction
business)
William K. Upchurch, Jr. (61) April 23, 1987 46,304(4)
Chairman and Chief Executive Officer, W. K. 0.06%
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.
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.
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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 or otherwise (and will continue to serve as directors
following the Annual Meeting) the names, ages and principal occupations during
the past five years, the year 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.
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<TABLE>
<CAPTION>
NUMBER AND PERCENT
OF SHARES OF COMMON
STOCK OF THE COMPANY
BENEFICIALLY OWNED AS
NAME, AGE AND PRINCIPAL CURRENT TERM DIRECTOR OF JANUARY 31,
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 1,186,772(3)
Chairman and Chief Executive 1.48%
Officer of the Company
Roy W. Gilbert, Jr. (57) 1996 December 22, 1977 256,798(4)
President of the Company 0.32%
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.
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<PAGE> 8
(3) Includes 29,250 shares held by Mr. Malone's wife, 78,468 shares held
by minor children and 107,630 shares subject to employee stock options
exercisable within 60 days after December 31, 1993; does not include
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 and 151,159 shares subject to employee stock options exercisable
within 60 days after December 31, 1993; does not include 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 the
Company's 1990 Discounted Stock Plan. 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.
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).
As of January 31, 1994, the executive officers and directors
of the Company as a group, consisting of 15 persons, owned beneficially
4,894,204 shares of Common Stock of the Company, or approximately 6.11% 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.,
6
<PAGE> 9
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, 137,885,
155,469, and 122,101 shares of Common Stock of the Company, respectively, or
approximately 0.17%, 0.19% and 0.15%, respectively.
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 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 this 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 of the performance goals
under which compensation thereunder is to be paid to certain executives of the
Company and its subsidiaries.
7
<PAGE> 10
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 its
subsidiaries 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. Under the Incentive Plan, the Human Resources Committee, after
consultation with the Chairman of the Board of Directors and 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 criterion that must be met for such executives to obtain such
award; the Human Resources Committee, acting in executive session and without
participation of the Chairman of the Board of Directors and President of the
Company, determines the award opportunities and performance criterion for the
Chairman of the Board of Directors and the President of the Company. Award
opportunities are expressed as a percentage of each participant's base salary
for the ensuing fiscal year and may vary for each participant and from year to
year, but in no event is any participant eligible to receive an award under the
Incentive Plan that exceeds $1,000,000 for any fiscal year. The performance
criteria 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. For fiscal 1994, the Human Resources Committee has determined
that cash bonuses to be awarded participants under the Incentive Plan will
range from 20% to 60% of a participant's 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 net income goals that were assigned to each participant by the Human
Resources Committee in establishing such participant's award opportunity. 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 goal is
achieved, the maximum award shall be deemed to be earned if 105% of a
participant's goal is achieved and incremental portions of the award shall be
deemed to be earned if more than 95% but less than 105% of a participant's goal
is achieved.
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 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.
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<PAGE> 11
THE BOARD OF DIRECTORS RECOMMENDS THE 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 to 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 invested 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.
9
<PAGE> 12
COMPARISON OF FIVE-YEAR CUMULATIVE TOTAL RETURN
SOUTHTRUST CORPORATION
(Performance through December 31, 1993)
<TABLE>
<CAPTION>
S&P Major
Year SouthTrust S&P 500 Reg. Banks
- ---- ---------- ------- ----------
<S> <C> <C> <C>
1988 100 100 100
1989 120 132 122
1990 89 127 87
1991 219 166 156
1992 228 179 199
1993 265 197 210
</TABLE>
<PAGE> 13
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 and rewards the executive for the
executive's performance and total contribution to the success of the
Company.
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. 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
10
<PAGE> 14
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 various base
salaries reported by the peer institutions. 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 year. Upon completion of the business plan
for the forthcoming 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.
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 30% 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 elsehere in the Proxy Statement, the Incentive
Plan is being submitted to the stockholders of the Company for their
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 intends to recommend to the Board of Directors that it
continue to take appropriate steps to qualify compensation payable
to its executives for deductibility under the federal income tax laws.
Stock Options:
- -------------
11
<PAGE> 15
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 is 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 this 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.
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
competitor's practices.
The 1993 base salary increase 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, 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 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
12
<PAGE> 16
Company for 1993 was 55% and the maximum award was 60%. 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
--------------------------------------------------------------
Compansation Decisions.
----------------------
None of the members of the Human Resources Committee have served as
officers of the Company. In addition, none of the Human Resources Committee
members have any other relationship to the Company.
13
<PAGE> 17
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
----------------------
Annual Compensation(1) Awards Payouts
------------------- ------ -------
- -----------------------------------------------------------------------------------------------------------------------
Other
Name Annual Restricted Options
and Compen- Stock (Number LTIP All Other
Principal(1) Bonus sation Award(s) of Payouts Compensation
Position Year Salary ($) ($)(2) ($)(3) ($) Shares) ($) ($)
- -----------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Wallace D.
Malone, Jr.,
Chief
Executive 1993 $605,016 $363,000 $20,121 N/A 32,266(4) N/A $59,770(5)
Officer of 1992 565,008 254,250 18,305 N/A 34,827(4) N/A 58,661
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 1992 414,024 165,600 13,501 N/A 25,518(4) N/A 43,023
the Company 1991 377,520 151,000 * N/A 56,154(4) N/A *
- -----------------------------------------------------------------------------------------------------------------------
Julian W.
Banton,
President 1993 $292,000 $160,600 $5,152 N/A 11,679(4) N/A $28,836(6)
and Chief 1992 267,000 93,450 4,821 N/A 12,342(4) N/A 27,705
Executive 1991 247,008 86,450 * N/A 27,555(4) N/A *
Officer of
SouthTrust
Bank of
Alabama,
N.A.
- -----------------------------------------------------------------------------------------------------------------------
Frederick W.
Murray, Jr.,
Executive 1993 $183,000 $82,350 $5,954 N/A 7,319(4) N/A $18,158(6)
Vice 1992 172,800 60,480 3,839 N/A 7,987(4) N/A 18,032
President of 1991 163,800 57,330 * N/A 18,274(4) N/A *
the Company
- -----------------------------------------------------------------------------------------------------------------------
James W.
Rainer, Jr.,
Executive
Vice 1993 $171,000 $76,950 $4,099 N/A 6,839(4) N/A $16,971(6)
President of 1992 161,000 56,350 5,571 N/A 7,443(4) N/A 16,805
the Company 1991 143,000 50,050 * N/A 15,952(4) N/A *
- --------------------------
</TABLE>
14
<PAGE> 18
* 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 Stock Option
Committee administering the Stock Option Plans 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 Stock 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 continuous years of regular full time 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
15
<PAGE> 19
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:
<TABLE>
<CAPTION>
OPTION GRANTS IN LAST FISCAL YEAR
---------------------------------
Individual Grants
- -----------------------------------------------------------------------------------------------------------------------------------
% of Total Potential
Options Options Exercise Realizable Value
Granted Granted or Base Assuming Rates of Stock
(Number of Employees Price Expiration Price Appreciation of
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.
16
<PAGE> 20
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:
<TABLE>
<CAPTION>
AGGREGATED OPTION EXERCISES IN 1993
-----------------------------------
AND DECEMBER 31, 1993 OPTION VALUES
-----------------------------------
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.
17
<PAGE> 21
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.
18
<PAGE> 22
<TABLE>
<CAPTION>
PENSION PLAN TABLE
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.
19
<PAGE> 23
TRANSACTIONS WITH MANAGEMENT
Directors and executive officers of the Company and their
associates were customers of and/or had transactions with the banks 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.
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 & 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.
20
<PAGE> 24
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
Birmingham, Alabama Secretary
_____________, 1994
21
<PAGE> 25
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.
W I T N E S S E T H:
WHEREAS, the Board of Directors of SouthTrust Corporation has
previously established the Senior Officer Performance Incentive Plan of
SouthTrust Corporation, which initially was effective as of the _____ day of
_______________, 19___; 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.
<PAGE> 26
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
2
<PAGE> 27
Participating Employer and who is serving as the Chief
Executive Officer of each such Participating Employer.
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 criterion 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
compensation for such Fiscal Year and shall specify a minimum,
maximum and target award for each such Participant) and the
performance criteria that must be achieved in order
3
<PAGE> 28
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 Employee 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 greater than $1,000,000
with respect to any Fiscal Year. In establishing the award
and performance criterion 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 criteria assigned to each such Participant to, if
the Participant is a Senior Officer of SouthTrust, the net
income, after
4
<PAGE> 29
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 Employee 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.
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
5
<PAGE> 30
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
6
<PAGE> 31
(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.
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.
7
<PAGE> 32
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
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<PAGE> 33
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:
1. ELECTION OF DIRECTORS:
/ / FOR all nominees below / / WITHHOLD AUTHORITY to vote
for all nominees below
(except as indicated to
the 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:
/ / FOR or / / AGAINST 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.
<PAGE> 34
3. APPROVAL AND RATIFICATION OF THE INCENTIVE PLAN:
/ / FOR or / / AGAINST 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.
4. OTHER MATTERS:
In their discretion, upon such other matters as may properly come
before the Annual Meeting of the Stockholders.
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.)
2
