SOUTHTRUST CORP
S-4, 1998-11-04
NATIONAL COMMERCIAL BANKS
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<PAGE>   1
As filed with the Securities and Exchange Commission on November 4, 1998
                                                Registration No. 333-__________


                       SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549
                          ----------------------------
                                    FORM S-4
                          REGISTRATION STATEMENT UNDER
                           THE SECURITIES ACT OF 1933
                          ----------------------------

                             SOUTHTRUST CORPORATION
             (Exact name of registrant as specified in its charter)

<TABLE>
<S>                                       <C>                                     <C>   
        DELAWARE                                      6711                            63-0574085
(State or other jurisdiction of           (Primary Standard Industrial             (I.R.S. Employer
incorporation or organization)            Classification Code Number)             Identification No.)
</TABLE>


                             420 NORTH 20TH STREET
                           BIRMINGHAM, ALABAMA 35203
                                 (205) 254-5000
  (Address, including zip code, and telephone number, including area code, of
                   registrant's principal executive offices)
                          ----------------------------
                                 ALTON E.YOTHER
                            SOUTHTRUST CORPORATION
                             420 NORTH 20TH STREET
                           BIRMINGHAM, ALABAMA 35203
                                 (205) 254-5000
           (Name, address, including zip code, and telephone number,
                  including area code, of agent for service)

                                With copies to:

    C. LARIMORE WHITAKER                                   JOHN P. GREELEY
BRADLEY ARANT ROSE & WHITE LLP                        SMITH, MACKINNON, GREELEY
        2001 PARK PLACE                                  BOWDOIN & EDWARDS
          SUITE 1400                                   SUITE 800 CITRUS CENTER
  BIRMINGHAM, ALABAMA 35203                           255 SOUTH ORANGE AVENUE
       (205) 521-8000                                  ORLANDO, FLORIDA 32801
                                                           (407) 843-7300

     ---------------------------------------------------------------------

     APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE TO THE PUBLIC: As soon
as practicable after the effective date of this Registration Statement.
     If the securities being registered on this Form are being offered in
connection with the formation of a holding company and there is compliance with
General Instruction G, check the following box.  [ ]
     If this form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act, check the following box and
list the Securities Act registration statement number of the earlier effective
registration statement for the same offering.  [ ] -----------------------------
     If this form is a post-effective amendment filed pursuant to Rule 462(d)
under the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering.  [ ] ----------------------------------------------------

                        CALCULATION OF REGISTRATION FEE

<TABLE>
<CAPTION>
==========================================================================================================================
                                                                Proposed maximum      Proposed maximum                    
         Title of each class of              Amount to be        offering price      aggregate offering      Amount of      
      securities to be registered             registered            per unit               price          registration fee  
                                                                                                        
- --------------------------------------------------------------------------------------------------------------------------
<S>                                          <C>                <C>                  <C>                  <C>  
Common Stock, par value
 $2.50 per share........................     253,546 Shares(1)          *             $5,182,458.05(3)        $1440.72
Rights to Purchase Series A Junior
 Participating Preferred Stock..........      75,036 Rights(2)
==========================================================================================================================
</TABLE>

*   Not Applicable
(1) This Registration Statement covers the maximum number of shares of the
    common stock of the Registrant which is expected to be issued in connection
    with the merger of First American Bank of Indian River County with and into
    a subsidiary of SouthTrust Corporation.
(2) Represents eight twenty-sevenths of a Right issued in respect of each share
    of Common Stock issued.
(3) Estimated solely for purposes of determining the amount of the registration
    fee, in accordance with Rule 457(f)(2) under the Securities Act of 1933.

                          ----------------------------
THE REGISTRANT HEREBY AMENDS THIS REGISTRATION STATEMENT ON SUCH DATE OR DATES
AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE REGISTRANT SHALL FILE
A FURTHER AMENDMENT WHICH SPECIFICALLY STATES THAT THIS REGISTRATION STATEMENT
SHALL THEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH SECTION 8(A) OF THE
SECURITIES ACT OF 1933 OR UNTIL THE REGISTRATION STATEMENT SHALL BECOME
EFFECTIVE ON SUCH DATE AS THE COMMISSION ACTING PURSUANT TO SAID SECTION 8(A),
MAY DETERMINE.


<PAGE>   2

                                                            November ____, 1998
TO THE SHAREHOLDERS OF
FIRST AMERICAN BANK OF INDIAN RIVER COUNTY:

         You are cordially invited to attend a Special Meeting of the
Shareholders (the "Special Meeting") of First American Bank of Indian River
County ("First American") to be held on __________, __________ ____, 1998, at
_____ ____, local time, at 780 US Highway 1, Suite 101, Vero Beach, Florida,
32962 notice of which is enclosed.

         At the Special Meeting, you will be asked to consider and vote on a
proposal to approve an Agreement and Plan of Merger (the "Merger Agreement"),
as amended, which provides for the merger (the "Merger") of First American with
and into SouthTrust Bank, National Association ("ST-Bank"), a subsidiary of
SouthTrust Corporation ("SouthTrust"). Upon consummation of the Merger, each
share of First American common stock issued and outstanding (except for certain
shares held by First American or SouthTrust, or their respective subsidiaries,
in each case other than shares held in a fiduciary capacity or in satisfaction
of debts previously contracted) will be converted into 1.887 shares of
SouthTrust common stock (subject to possible adjustment under certain 
circumstances), with cash being paid in lieu of issuing fractional shares.

         Enclosed are the (1) Notice of Special Meeting, (2) Proxy
Statement/Prospectus, and (3) Proxy for the Special Meeting. The Proxy
Statement/Prospectus describes in more detail the Merger Agreement and the
proposed Merger, including a description of the conditions to consummation of
the Merger and the effects of the Merger on the rights of First American
shareholders. Please read these materials carefully and consider thoughtfully
the information set forth in them.

         THE BOARD OF DIRECTORS HAS UNANIMOUSLY APPROVED THE MERGER AGREEMENT
AND CONSUMMATION OF THE MERGER CONTEMPLATED BY THE MERGER AGREEMENT, AND
UNANIMOUSLY RECOMMENDS THAT YOU VOTE FOR APPROVAL OF THE MERGER AGREEMENT.

         Approval of the Merger Agreement will require the affirmative vote of
two-thirds of the votes entitled to be cast at the Special Meeting by the
holders of the issued and outstanding shares of First American common stock,
each share of First American common stock being entitled to one vote.
Accordingly, whether or not you plan to attend the Special Meeting, you are
urged to complete, sign, and return promptly the enclosed proxy card. If you
attend the Special Meeting, you may vote in person if you wish, even if you
previously have returned your proxy card. The proposed Merger is a significant
step for First American and your vote on this matter is of great importance.

         ON BEHALF OF THE BOARD OF DIRECTORS, I URGE YOU TO VOTE FOR APPROVAL
OF THE AGREEMENT BY MARKING THE ENCLOSED PROXY CARD "FOR" ITEM ONE.

         We look forward to seeing you at the Special Meeting.

                                        
                                        Sincerely,

                                        /s/ ROBERT J. MACWILLIAM
                                        -------------------------------------
                                        ROBERT J. MACWILLIAM
                                        President


                                        /s/ SAMUEL A. BLOCK
                                        -------------------------------------
                                        SAMUEL A. BLOCK
                                        Chairman


<PAGE>   3

                   NOTICE OF SPECIAL MEETING OF SHAREHOLDERS


         Notice is hereby given that a Special Meeting of Shareholders of First
American Bank of Indian River County, a Florida banking corporation ("First
American"), will be held on __________ ____, 1998, at _____ ____, local time,
at 780 US Highway 1, Suite 101, Vero Beach, Florida, 32962 for the following
purposes (the "Special Meeting"):

                  1. To consider and vote upon the Agreement and Plan of
         Merger, dated as of July 1, 1998 as amended by the Amendment No. 1 to
         the Agreement and Plan of Merger dated as of September 14, 1998 (as
         amended, the "Merger Agreement"), a copy of which is annexed as
         Exhibit A to the accompanying Proxy Statement/Prospectus, by and among
         First American and SouthTrust Bank, National Association, a national
         banking association ("ST-Bank"), and joined in by SouthTrust
         Corporation, a Delaware corporation ("SouthTrust"), and SouthTrust of
         Alabama, Inc., an Alabama corporation and wholly owned subsidiary of
         SouthTrust ("ST-Sub"), whereby First American will be merged with and
         into ST-Bank and each share of First American common stock will be
         converted into 1.887 shares of SouthTrust common stock (subject to 
         possible adjustment under certain circumstances), with cash being paid
         in lieu of issuing fractional shares, for each share of First American
         common stock, all pursuant to and in accordance with the terms and
         conditions of the Merger Agreement, all as more fully described in the
         accompanying Proxy Statement/Prospectus; and

                  2. To consider and act upon such other matters as may
         properly come before the Special Meeting or any adjournment or
         adjournments thereof.

         Only those persons who were holders of record of shares of common
stock of First American at the close of business on __________ ____, 1998 are
entitled to notice of and to vote at the Special Meeting and any adjournment
thereof. A holder of First American common stock who complies with the
provisions of applicable law relating to dissenters' rights will be entitled to
receive payment in cash of the value of the shares held by the shareholder if
such holder (i) has voted against the approval of the Merger Agreement at the
Special Meeting, or (ii) has given written notice to First American at or prior
to the Special Meeting that the shareholder dissents from the Merger Agreement.
A copy of the dissenters' rights provisions under applicable law is attached to
the enclosed Proxy Statement/Prospectus as Exhibit B. SHARES OF A HOLDER VOTING
AGAINST THE MERGER AT THE SPECIAL MEETING WILL BE TREATED AS DISSENTING SHARES
UNDER APPLICABLE LAW, AND HOLDERS OF SUCH SHARES WILL RECEIVE CASH FOR THE
VALUE OF THE SHARES IF THEY MAKE WRITTEN REQUEST TO FIRST AMERICAN WITHIN 30
DAYS OF CONSUMMATION OF THE MERGER AND OTHERWISE FOLLOW THE REQUIREMENTS OF THE
DISSENTERS' RIGHTS PROVISIONS. SUCH "VALUE" SHALL BE DETERMINED BY APPRAISAL,
THE RESULTS OF WHICH CANNOT BE PREDICTED. RECEIPT OF SUCH CASH PAYMENT WILL BE
A TAXABLE EVENT TO THE FIRST AMERICAN SHAREHOLDER.

         The meeting may be adjourned or postponed from time to time without
notice other than announcement at the meeting, or at any adjournment or
postponement thereof, and any business for which notice is hereby given may be
transacted at any such adjournment or postponement.

         A Proxy Card and a Proxy Statement/Prospectus for the Special Meeting
are enclosed.

                                           By Order of the Board of Directors


                                           ----------------------------------  
                                           Secretary
Vero Beach, Florida
November ____, 1998

         WHETHER YOU PLAN TO ATTEND THE SPECIAL MEETING OR NOT, PLEASE SIGN AND
RETURN THE ENCLOSED PROXY SO THAT FIRST AMERICAN MAY BE ASSURED OF THE PRESENCE
OF A QUORUM AT THE SPECIAL MEETING. A SELF-ADDRESSED ENVELOPE IS ENCLOSED FOR
YOUR CONVENIENCE. NO POSTAGE IS REQUIRED IF MAILED IN THE UNITED STATES.


<PAGE>   4

PROXY STATEMENT/PROSPECTUS


                               Proxy Statement of

                   FIRST AMERICAN BANK OF INDIAN RIVER COUNTY

                   For a Special Meeting of its Shareholders
                        to be held __________ ____, 1998



                This Proxy Statement includes the Prospectus of

                             SOUTHTRUST CORPORATION

                Relating to up to 253,546 shares of Common Stock
                          (Par Value $2.50 Per Share)

              TO BE ISSUED IN CONNECTION WITH A PROPOSED MERGER OF
                FIRST AMERICAN BANK OF INDIAN RIVER COUNTY INTO
                     SOUTHTRUST BANK, NATIONAL ASSOCIATION,
                     A SUBSIDIARY OF SOUTHTRUST CORPORATION


         SOUTHTRUST CORPORATION COMMON STOCK IS QUOTED ON NASDAQ UNDER 
                               THE SYMBOL SOTR.


- -        You should rely only on the information contained in this document or
         information that we have referred you to. We have not authorized
         anyone to provide you with information that is different.

- -        This document offers only the Common Stock identified on this page and
         offers it only where it is legal to do so.

- -        The information in this document or that we have referred you to is
         correct as of the date of this document, as shown at the bottom of
         this page, but it may not continue to be correct after that date.

- -        First American has provided all of the information about First
         American contained in this document. SouthTrust and its subsidiaries
         are relying on the correctness of that information.

- -        SouthTrust and its subsidiaries have provided all of the information
         about SouthTrust and its subsidiaries that is contained in this
         document or that we have referred you to. First American is relying on
         the correctness of that information.



This Proxy Statement/Prospectus and the accompanying form of proxy are first
being mailed to shareholders of First American on or about __________ ____,
1998.


NEITHER THE SECURITIES AND EXCHANGE COMMISSION NOR ANY STATE SECURITIES
COMMISSION HAS APPROVED OR DISAPPROVED OF THE SECURITIES OR DETERMINED IF THIS
PROSPECTUS IS TRUTHFUL OR COMPLETE. ANY REPRESENTATION TO THE CONTRARY IS A
CRIMINAL OFFENSE.

THE SECURITIES OFFERED BY THIS DOCUMENT (1) ARE NOT SAVINGS ACCOUNTS OR BANK
DEPOSITS, (2) ARE NOT OBLIGATIONS OF A BANK OR SAVINGS ASSOCIATION, AND (3) ARE
NOT INSURED BY THE FEDERAL DEPOSIT INSURANCE CORPORATION OR ANY OTHER
GOVERNMENTAL AGENCY.

     The date of this Proxy Statement/Prospectus is __________ ____, 1998.


<PAGE>   5

                               TABLE OF CONTENTS

<TABLE>
<S>                                                                                                              <C>   

AVAILABLE INFORMATION.............................................................................................4

INTRODUCTION......................................................................................................5
         General  ................................................................................................5
         Voting at the Special Meeting............................................................................6

SUMMARY  .........................................................................................................7
         The Companies............................................................................................7
         Special Meeting..........................................................................................8
         The Merger...............................................................................................8
         Certain Federal Income Tax Consequences.................................................................11
         Rights of Dissent and Appraisal.........................................................................11
         Comparative Stock Prices................................................................................11
         Resale of SouthTrust Common Stock Received in the Merger................................................12
         Differences in Rights of First American Shareholders....................................................12
         Accounting Treatment....................................................................................12
         Cautionary Statement Concerning Forward-looking Information.............................................12
         Equivalent Share Data...................................................................................13
         Selected Financial Data.................................................................................14
         Selected Pro Forma Information..........................................................................15

THE MERGER.......................................................................................................16
         General  ...............................................................................................16
         Background of and Reasons for the Merger................................................................17
         Opinion of Financial Adviser............................................................................19
         Interests of Certain Named Persons in the Merger........................................................24
         Effect of the Merger on First American Common Stock.....................................................26
         Effect of the Merger on First American Stock Options....................................................27
         Possible Conversion Ratio Adjustment....................................................................28
         Effective Time of the Merger............................................................................30
         Exchange of Stock Certificates..........................................................................30
         Resale of SouthTrust Common Stock Received in the Merger................................................31
         Accounting Treatment....................................................................................32
         Regulatory Approvals and Certain Other Conditions to the Merger.........................................32
         Waiver and Amendment....................................................................................34
         Termination.............................................................................................34
         Certain Expenses........................................................................................36
         Rights of Dissent and Appraisal.........................................................................36
         Conduct of Business by First American Pending the Merger................................................37
         Business and Management of First American Following the Merger..........................................39

CERTAIN FEDERAL INCOME TAX CONSEQUENCES..........................................................................40
         General  ...............................................................................................40

DESCRIPTION OF SOUTHTRUST CAPITAL STOCK..........................................................................42
         General  ...............................................................................................42
         SouthTrust Common Stock.................................................................................42
         SouthTrust Preferred Stock..............................................................................45

MARKET PRICE AND DIVIDEND INFORMATION RESPECTING THE
         SOUTHTRUST COMMON STOCK AND THE FIRST AMERICAN COMMON STOCK.............................................47
         Market Price............................................................................................47
         Dividends...............................................................................................48

COMPARISON OF THE
         SOUTHTRUST COMMON STOCK
         AND THE FIRST AMERICAN STOCK............................................................................49
         Dividends...............................................................................................49
         Voting Rights and Other Matters.........................................................................49
         Dissent and Appraisal Rights............................................................................53
         Rights on Liquidation...................................................................................53
         Preemptive Rights.......................................................................................53
         Reports to Stockholders and Shareholders................................................................54
         Stockholders' Rights Plan...............................................................................54
</TABLE>


                                       2
<PAGE>   6

<TABLE>
<S>                                                                                                             <C>   
SUPERVISION AND REGULATION.......................................................................................54
         SouthTrust..............................................................................................54
         First American..........................................................................................57

CERTAIN INFORMATION CONCERNING THE BUSINESS OF FIRST AMERICAN....................................................57
         General  ...............................................................................................57
         Employees...............................................................................................59
         Description of Properties...............................................................................59
         Legal Proceedings.......................................................................................59
         Regulation and Legislation..............................................................................59
         Certain Relationships and Related-Party Transactions....................................................59
         Beneficial Ownership of First American Common Stock.....................................................59

FIRST AMERICAN MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
         AND RESULTS OF OPERATIONS...............................................................................60

General  ........................................................................................................60
         Results of Operations...................................................................................61
         Net Interest Income.....................................................................................63
         Provision for Loan Losses...............................................................................65
         Non-Interest Income.....................................................................................66
         Non-Interest Expense....................................................................................66
         Income Taxes............................................................................................67
         Asset/Liability Management..............................................................................67

Financial Condition..............................................................................................71
         Asset Quality...........................................................................................72
         Classification of Assets................................................................................73
         Allowance for Loan Losses...............................................................................73
         Investment Activities...................................................................................75
         Deposit Activities......................................................................................76
         Return on Equity and Assets.............................................................................78
         Liquidity and Capital Resources.........................................................................78
         Impact of Inflation and Changing Prices.................................................................78

WHERE YOU CAN FIND MORE INFORMATION
         (INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE).......................................................79

LEGAL MATTERS....................................................................................................80

EXPERTS  ........................................................................................................80

ADDITIONAL INFORMATION...........................................................................................80
         Other Business..........................................................................................80

FINANCIAL STATEMENTS OF FIRST AMERICAN..........................................................................F-i

EXHIBIT A - AGREEMENT AND PLAN OF MERGER........................................................................A-i

EXHIBIT B - FAIRNESS OPINION OF ALLEN C. EWING & CO.............................................................B-1

EXHIBIT C - NATIONAL BANK ACT DISSENT PROVISIONS................................................................C-1
</TABLE>


                                       3
<PAGE>   7

                             AVAILABLE INFORMATION


         SouthTrust is required by the Securities Exchange Act of 1934, as
amended (the "Exchange Act"), to give certain information about itself to the
Securities and Exchange Commission (the "Commission"). Therefore, SouthTrust
files reports, proxy and information statements and other information with the
Commission. You may inspect and copy this information at the following
locations:

Securities and Exchange Commission
Judiciary Plaza, Room 1024
450 Fifth Street, N.W.
Washington, D.C. 20549

Securities and Exchange Commission
Seven World Trade Center, Suite 1300
New York, New York 10048

Securities Exchange Commission
Citicorp Center, Suite 1400
500 West Madison Street
Chicago, Illinois 60661-2511

http://www.sec.gov
(the Commission's site on the world wide web)

National Association of Securities Dealers, Inc.
1735 K Street, N.W.
Washington, D.C. 20096



COPIES OF SUCH MATERIAL CAN BE OBTAINED
AT PRESCRIBED RATES FROM:

Securities and Exchange Commission
Public Reference Section
450 Fifth Street, N.W.
Washington, D.C. 20549

You may obtain further information about the Public Reference Section by
calling 1-800-SEC-0330.


THIS PROXY STATEMENT/PROSPECTUS INCORPORATES DOCUMENTS BY REFERENCE WHICH ARE
NOT PRESENTED IN OR DELIVERED WITH THIS DOCUMENT. THE DOCUMENTS RELATING TO
SOUTHTRUST (OTHER THAN EXHIBITS TO SUCH DOCUMENTS WHICH ARE NOT SPECIFICALLY
INCORPORATED BY REFERENCE IN SUCH DOCUMENTS) ARE AVAILABLE ON REQUEST WITHOUT
CHARGE FROM:

         ALTON E. YOTHER
         SOUTHTRUST CORPORATION
         420 NORTH 20TH STREET
         BIRMINGHAM, ALABAMA 35203
         TELEPHONE NUMBER (205) 254-5000.

IN ORDER TO ENSURE TIMELY DELIVERY OF THE DOCUMENTS, YOU SHOULD MAKE YOUR
REQUEST BY __________ ____, 1998.  SEE "WHERE YOU CAN FIND MORE INFORMATION."


         You can find more information about the Common Stock that is offered
by this document if you read SouthTrust's Registration Statement on Form S-4
(we will refer to it and any amendments to it as the "Registration Statement")
which has been filed with the Commission under the Securities Act of 1933, as
amended (the "Securities Act"). This Proxy Statement/ Prospectus does not
contain all of the information contained in the Registration Statement and its
exhibits and schedules. In this Proxy Statement/ Prospectus, we may discuss the
contents of contracts or other documents. Our statements about these other
documents are not necessarily complete, and therefore in each instance we will
refer you to a copy of such contract or other document that is filed as an
exhibit to the Registration Statement. Such statements are qualified in all
respects by those references.

         You may inspect the Registration Statement and its exhibits and
schedules at the Commission's office at 450 Fifth Street, N.W., Washington,
D.C. 20549. You may also obtain copies of the Registration Statement and its
exhibits and schedules from the Public Reference Section of the Commission at
the same address at prescribed rates.


                                       4
<PAGE>   8

                                  INTRODUCTION


GENERAL

         We are providing this Proxy Statement/Prospectus to you as a
shareholder of First American Bank of Indian River County, a Florida banking
corporation ("First American"), in connection with the solicitation of your
proxy by the Board of Directors of First American for use at a special meeting
of shareholders of First American to be held on December ____, 1998, at _____
____, local time, at 780 US Highway 1, Suite 101, Vero Beach, Florida, 32962
and at any adjournment or postponement of the Special Meeting (the "Special
Meeting").

         The purpose of the Special Meeting is to consider and vote upon the
merger of First American with and into SouthTrust Bank, National Association
("ST-Bank"). The Boards of Directors of First American and ST-Bank have approved
the Merger. At the Special Meeting you will be considering and voting on the
Agreement and Plan of Merger dated as of July 1, 1998, as amended by that
certain Amendment No. 1 to the Agreement and Plan of Merger dated as of
September 14, 1998 (as amended, the "Merger Agreement") of First American and
ST-Bank, joined in by SouthTrust Corporation, a Delaware corporation
("SouthTrust"), and SouthTrust of Alabama, Inc., an Alabama corporation and a
wholly-owned subsidiary of SouthTrust ("ST-Sub"), providing for the Merger.

         If the shareholders of First American approve the Merger Agreement and
all conditions contained in the Merger Agreement are met or waived, then the
Merger will become effective on the date and at the time on which the Merger is
deemed effective (the "Effective Time of the Merger") by the Office of the
Comptroller of the Currency (the "Comptroller").

         We have included a copy of the Merger Agreement (including the
Amendment) as Exhibit A of this document. To understand the Merger more fully,
you should carefully read the Merger Agreement in addition to this Proxy
Statement/Prospectus. See "THE MERGER."



                      WHAT YOU WILL RECEIVE IN THE MERGER

         If the Merger is consummated, each outstanding share of First American
Common Stock (except shares as to which dissenters' rights are perfected) will
be converted into 1.887 shares of SouthTrust Common Stock, as may be subject to
possible adjustment under certain circumstances (the "Conversion Ratio"). See
"THE MERGER - Effect of the Merger on First American Common Stock."

         The 1.887 shares of SouthTrust Common Stock for which each share of
First American Common Stock may be exchanged in the Merger had an aggregate
market value of $_______, based upon the last sales price of SouthTrust Common
Stock on __________ ____, 1998. See "DESCRIPTION OF SOUTHTRUST CAPITAL STOCK -
SouthTrust Common Stock" and "MARKET AND DIVIDEND INFORMATION RESPECTING THE
COMMON STOCK OF SOUTHTRUST." Because each share of First American Common Stock
will be converted into a fixed number of shares of SouthTrust Common Stock in
the Merger, a change in the market price of SouthTrust Common Stock before the
Merger would affect the value of the SouthTrust Common Stock that you would
receive in the Merger in exchange for each share of First American Common
Stock. The Merger Agreement, however, provides that, if the value of SouthTrust
Common Stock has fallen by a certain amount and certain other circumstances
have occurred, then First American will have the right to terminate the Merger
Agreement. In such event, however, SouthTrust may elect to adjust the
Conversion Ratio in the manner described under "THE MERGER -- Possible
Conversion Ratio Adjustment."

         In the Merger, you may also receive a small cash payment, equal to the
value of any fractional shares of SouthTrust Common Stock that you would
otherwise receive, instead of receiving any fractional shares.


                                       5
<PAGE>   9

VOTING AT THE SPECIAL MEETING

         The Board of Directors of First American has fixed the close of
business on __________ ____, 1998 as the record date (the "Record Date") to
determine the holders of shares of First American Common Stock entitled to
notice of and to vote at the Special Meeting. On the Record Date, First
American had [128,865] shares of First American Common Stock outstanding, which
is the only class of stock of First American. Holders of a majority of the
outstanding shares of First American Common Stock entitled to vote must be
present, in person or by proxy, to have a quorum at the Special Meeting. The
holders of two-thirds of the outstanding shares of First American Common Stock
must vote for the Merger Agreement in order to approve it. Each holder of
record of shares of First American Common Stock on the Record Date is entitled
to one vote for each share of such First American Common Stock held of record.

         As of the Record Date, First American directors and executive
officers, and their affiliates (a total of 11 persons) beneficially owned a
total of 60,626 shares of First American Common Stock, representing
approximately 47% of the shares of First American Common Stock entitled to vote
at the Special Meeting. All such directors and officers, and their affiliates,
have informed First American that, as of the date of the Proxy
Statement/Prospectus, they intend to vote for approval of the Merger Agreement.

         Under the National Bank Act, if a holder has voted "AGAINST" the
Merger or has given written notice to First American at or prior to the Special
Meeting that the shareholder dissents from the Merger Agreement and the
shareholder complies with the further requirements of law, such shareholder
shall be entitled to receive the value of the shares held by the holder. If the
Merger is consummated, such shares will be paid for in cash pursuant to the
process described in "THE MERGER - Rights of Dissent Appraisal." Shareholders
who exercise their dissenters' rights in connection with the Merger and
therefore receive cash, will encounter income tax treatment different from the
treatment for shareholders who receive SouthTrust Common Stock in the Merger.
See "CERTAIN FEDERAL INCOME TAX CONSEQUENCES."

         THE BOARD OF DIRECTORS OF FIRST AMERICAN RECOMMENDS THAT SHAREHOLDERS
VOTE FOR APPROVAL OF THE MERGER AGREEMENT. SEE "THE MERGER - BACKGROUND AND
REASONS FOR THE MERGER."

         If you properly complete and return a proxy in the form enclosed, in
time for the voting at the Special Meeting, with instructions specified on the
proxy, then your shares will be voted in accordance with such instructions. If
you do not specify instructions, then your signed proxy will be voted FOR
approval of the Merger Agreement. You may revoke your proxy at any time prior
to its exercise (1) by filing with the Secretary of First American either an
instrument revoking the proxy or a duly executed proxy bearing a later date or
(2) by attending the Special Meeting and voting in person. Attendance at the
Special Meeting will not by itself revoke a proxy.

         In addition to the use of the mail, proxies may be solicited by
telephone, telegraph or personally by the directors, officers and employees of
First American, who will receive no extra compensation for their services.
First American will reimburse banks, brokerage firms and other custodians,
nominees and fiduciaries for reasonable expenses incurred by them in sending
proxy soliciting materials to the beneficial owners of shares of First American
Common Stock.

         WE ASK THAT YOU COMPLETE, SIGN AND DATE THE ACCOMPANYING PROXY AND
RETURN IT PROMPTLY IN THE ENCLOSED, POSTAGE-PAID ENVELOPE.


                                       6
<PAGE>   10

                                    SUMMARY

         The following summary of material aspects of the Merger is not
         intended to be complete and is qualified by the more detailed
         discussion elsewhere in this Proxy Statement/Prospectus. The Agreement
         and Plan of Merger and the Amendment No. 1 to the Agreement and Plan
         of Merger, which we refer to, together, throughout this Proxy
         Statement/Prospectus as the "Merger Agreement," is attached as
         Appendix A. To understand the Merger fully, you should read carefully
         this entire Proxy Statement/Prospectus, including the Merger Agreement
         and the other documents we have referred you to. See "Where You Can
         Find More Information."

THE COMPANIES

  SouthTrust
  420 North 20th Street
  Birmingham, Alabama 35203
  (205) 254-5000

         SouthTrust is a regional bank holding company headquartered in
Birmingham, Alabama, and is engaged in a full range of banking services from
more than 600 banking locations in Alabama, Florida, Georgia, Mississippi,
North Carolina, South Carolina and Tennessee. SouthTrust also offers a range of
other services, including mortgage banking services, fiduciary and trust
services and securities brokerage services. As of June 30, 1998, SouthTrust had
consolidated total assets of approximately $34.7 billion.

         SouthTrust has pursued a strategy of acquiring banks and financial
institutions in or near major metropolitan or growth markets in Alabama,
Florida, Georgia, Mississippi, North Carolina, South Carolina and Tennessee.
The purpose of this strategy is to give SouthTrust business development
opportunities in metropolitan markets with favorable prospects for population
and per capita income growth.

         Through the first three quarters of 1998, SouthTrust effected
acquisitions of three financial institutions, and assumed deposits and acquired
certain assets of two others, with aggregate total assets of $4.8 billion. The
following table presents certain information as of September 30, 1998 with
respect to transactions that are currently pending as of the date of this Proxy
Statement/Prospectus or that have been consummated since September 30, 1998,
including the Merger:

<TABLE>
<CAPTION>


Institution                         Location            Total Assets       Total Deposits   Total Loans*
- -----------                         --------            ------------       --------------   -----------      
                                                                            (in millions)

<S>                                 <C>                 <C>                <C>              <C>  
Georgia National Bancorp            Athens, Ga.         $    89.5          $    77.9         $  66.1
First American Bank of
    Indian River County             Vero Beach, Fl.          43.9               38.7            29.9
SecurityBank Texas(1)               Arlington, Tx.           87.2               78.3            38.1
</TABLE>

- --------------
*Net of unearned income
(1) Acquisition completed October 30, 1998

         SouthTrust anticipates that each of the above transactions will be
accounted for as a pooling of interests. Consummation of the pending
transactions is subject to, in each case, among other things, approval by
applicable regulatory authorities.

         SouthTrust routinely evaluates opportunities to acquire bank holding
companies, banks and other financial institutions. Thus, at any particular
point in time, including the date of this Proxy Statement/Prospectus,
discussions and, in some cases, negotiations and due diligence activities
looking toward or leading to the execution of preliminary or definitive
acquisition agreements may occur or be in progress. These transactions may
involve SouthTrust acquiring such financial institutions in exchange for cash
or capital stock, and depending upon the terms of these transactions, the
transactions may dilute the SouthTrust Common Stock to be issued to holders of
First American Common Stock in the Merger.


  First American
  4000 20th Street
  Vero Beach, Florida 32960
  (561) 567-0552


                                       7
<PAGE>   11

         First American was organized in 1984 as a banking corporation under
the laws of the State of Florida and began operation on November 19, 1984 to
serve the banking needs of the residents of Indian River County, Florida and
surrounding areas. Since its organization, First American has provided most
traditional commercial banking services, such as interest and non-interest
bearing checking and savings accounts, commercial, real estate mortgage, and
installment consumer loans, certificates of deposit and individual retirement
accounts, among others. First American provides commercial banking services
primarily to residents of Indian River County, Florida, through its main
banking office and its branch office, opened May 20, 1996, located at 780 U.S.
Highway #1, Suite 101, Vero Beach, Florida 32962.

  SouthTrust of Alabama, Inc.

         ST-Sub, an Alabama corporation, is a wholly owned subsidiary of
SouthTrust. It owns ST-Bank. The main office of ST-Sub is located in
Birmingham, Alabama.

  SouthTrust Bank, National Association

         ST-Bank, a national banking association, is a wholly owned subsidiary
of ST-Sub. The main office of ST- Bank is located in Birmingham, Alabama.

SPECIAL MEETING

         The Special Meeting will be held at _____ ____, local time, on
__________, __________ ____, 1998, at 780 US Highway 1, Suite 101, Vero Beach,
Florida, 32962 to consider and vote upon the approval of the Merger Agreement.
If you are a holder of record of shares of First American Common Stock as of
the close of business on __________ ____, 1998, then you will be entitled to
notice of the Special Meeting and to vote at the Special Meeting.

THE MERGER

  Terms of the Merger

         If the shareholders of First American approve the Merger Agreement at
the Special Meeting and certain other conditions are met, then First American
will be merged into ST-Bank, and ST-Bank will be the surviving corporation (the
"Surviving Corporation").

         If you are a First American shareholder, and assuming that you do not
exercise dissenters' rights of appraisal, you will receive 1.887 shares of
SouthTrust Common Stock for each share of First American Common Stock you own
on the date of the merger, unless the Conversion Ratio is adjusted according to
the Merger Agreement. See "THE MERGER - General" and "Effect of the Merger on
First American Common Stock."

         The Conversion Ratio and the number of shares of SouthTrust Common
Stock to be issued in the Merger will be adjusted if SouthTrust makes any stock
splits, stock dividends, reclassifications or similar distributions.

         In addition to SouthTrust Common Stock, you will also receive a check
for a small amount of cash instead of any fractional shares you might otherwise
receive. To determine how much cash you will receive, we will multiply the
fractional number of shares you are otherwise entitled to by the closing price
of SouthTrust Common Stock on the last trading day before the Effective Time of
the Merger.

         First American can terminate the Merger Agreement if (1) the actual
average closing price of SouthTrust Common Stock for the ten day period ending
on the date this Proxy Statement/Prospectus is mailed is less than $41.1127,
which was the average closing price on June 26, 1998, and (2) the percentage
drop in the ten-day average closing price of SouthTrust Common Stock is greater
than the percentage drop in a one-day weighted average of the stock prices of
certain bank holding companies identified in the Merger Agreement. At that
point, SouthTrust can agree to issue more SouthTrust Common Stock by increasing
the Conversion Ratio. However, SouthTrust is not required to adjust the
Conversion Ratio, and it is possible under these circumstances that the First
American Board could decide that proceeding with the Merger at the lower
Conversion Ratio would still be in your best interest and consistent with the
Board's fiduciary duties.

         Promptly after the Effective Time of the Merger, SouthTrust or its
agents will send you a letter of transmittal for use in exchanging your stock
certificates formerly representing First American Common Stock for the right to
receive certificates representing the appropriate number of shares of
SouthTrust Common Stock plus a cash payment for any fractional shares. YOU
SHOULD NOT SEND IN YOUR FIRST AMERICAN STOCK CERTIFICATES UNTIL YOU RECEIVE THE
LETTER OF TRANSMITTAL AND INSTRUCTIONS. See "THE MERGER -- Exchange of Stock
Certificates."


                                       8
<PAGE>   12

 Background of and Reasons for the Merger; Recommendations of the Board of
 Directors of First American

         The Board of Directors of First American believes that the Merger
Agreement and the Merger are in the best interest of First American's
shareholders. THE FIRST AMERICAN DIRECTORS UNANIMOUSLY RECOMMEND THAT FIRST
AMERICAN SHAREHOLDERS VOTE FOR APPROVAL OF THE MERGER AGREEMENT. In unanimously
approving the Merger Agreement, First American's directors considered a number
of factors, including First American's and SouthTrust's financial conditions,
the financial terms and the income tax consequences of the Merger, the
likelihood of the Merger being approved by regulatory authorities without undue
conditions or delay and legal advice concerning the proposed Merger. The First
American directors also took into account an opinion received from Allen C.
Ewing & Co. ("Ewing"), First American's financial advisor in connection with
the Merger, that the consideration to be received by shareholders of First
American in the Merger is fair from a financial point of view.

         SouthTrust is engaging in the Merger because the Merger Agreement is
consistent with SouthTrust's expansion strategy within the southern United
States and because the acquisition of First American will increase SouthTrust's
existing market share in southeastern Florida and enhance its competitive
position in that market.

         See "THE MERGER -- Background of and Reasons for the Merger."

  Vote Required

         The Merger Agreement must be approved by the holders of two-thirds of
all outstanding shares of First American Common Stock. The directors and
executive officers of First American have indicated that they will vote a total
of 60,626 shares of First American Common Stock owned by them in favor of the
Merger Agreement. This represents about 47% of the shares of First American
Common Stock outstanding.

  Interests of Certain Named Persons in the Merger; Affiliate Agreements

         Certain officers and directors of First American may have interests in
the Merger that are different from your interests as a shareholder. For
example, SouthTrust has agreed to indemnify directors, officers, employees and
agents of First American from certain liabilities arising before and after the
Merger, to the full extent permitted under Florida law and First American's
Articles of Incorporation and Bylaws. In connection with the Merger Agreement,
all of the First American directors have entered into affiliate agreements with
SouthTrust which temporarily restrict them from transferring the SouthTrust
Common Stock they receive in the Merger. Additionally, SouthTrust has joined in
Employment Agreements with Robert J. MacWilliam and Steven C. Shackley, and ST-
Bank has entered Stay Pay Agreements with Steven C. Shackley, Audrey F. Glover
and Michael Float. For further details on these Employment and Stay Pay
Agreements, see "THE MERGER -- Interests of Certain Named Persons in the
Merger."

  Effective Time of the Merger

         If the conditions of the Merger Agreement are met, the Effective Time
of the Merger will occur on the date and at the time on which the Merger is
deemed effective by the Office of the Comptroller of the Currency. First
American and SouthTrust have agreed to use their reasonable efforts to cause
the Effective Time of the Merger to occur on the first business day following
the later of (1) the effective date (including the expiration of any applicable
waiting period) of the last consent of any regulatory authority required for
the Merger and (2) the date on which the shareholders of First American approve
the Merger Agreement, or (3) at such other time as the parties may agree. See
"THE MERGER - Effective Time of the Merger" and "THE MERGER -- Regulatory
Approvals and Certain Other Conditions to Consummation of the Merger; Waiver
and Amendment."

         WE CANNOT ASSURE YOU THAT THE NECESSARY SHAREHOLDER AND REGULATORY
APPROVALS WILL BE OBTAINED OR THAT THE OTHER CONDITIONS TO THE MERGER CAN OR
WILL BE SATISFIED. FIRST AMERICAN AND SOUTHTRUST ANTICIPATE THAT ALL CONDITIONS
TO THE CONSUMMATION OF THE MERGER WILL BE SATISFIED SO THAT THE MERGER CAN BE
CONSUMMATED ON OR BEFORE ________, 1998. HOWEVER, DELAYS IN THE CONSUMMATION OF
THE MERGER COULD OCCUR.

  Ownership of SouthTrust following the Merger

         SouthTrust will issue approximately 253,546 shares of its stock to
First American shareholders in connection with the Merger, which will
constitute less than 1% of the outstanding stock of SouthTrust after the
Merger. The shares will be listed for trading on the Nasdaq National Market.

  Opinion of Financial Adviser


                                       9
<PAGE>   13

         Allen C. Ewing & Co. ("Ewing"), acting as financial adviser to First
American, has issued its Opinion stating that the consideration to be received
by First American shareholders in the Merger is fair, from a financial point of
view. The full text of Ewing's Opinion is set forth as Exhibit B to this Proxy
Statement/Prospectus. See "THE MERGER -- Opinion of Financial Adviser."

  Regulatory Approvals and Certain Other Conditions to the Merger; Waiver and 
  Amendment

         The obligations of SouthTrust and First American to consummate the
Merger are subject to certain conditions, including, among others, (1) the
receipt of all required regulatory approvals with respect to the Merger, (2)
the approval of the Merger Agreement by the requisite vote of First American
shareholders, and (3) certain other conditions customary in transactions of
this kind.

         The Merger must be approved by the Comptroller under the Bank Merger
Act, and ST-Bank has submitted an application to the Comptroller seeking
approval of the Merger which is still pending.

         If the Comptroller approves the merger, then the United States
Department of Justice has 30 days in which to comment adversely on the
transaction or challenge the Merger on antitrust grounds. If the United States
Attorney General does not give the Comptroller any adverse comments in the
first 15 days after approval by the Comptroller and the United States Attorney
General consents to the shorter period, then the merger may be consummated
before the 30 day period has ended. If an antitrust action is begun, then the
effectiveness of the Comptroller's approval will be suspended unless a court
specifically orders otherwise.

         THE MERGER CANNOT PROCEED WITHOUT THE REQUIRED REGULATORY APPROVALS.
IT IS POSSIBLE THAT THESE GOVERNMENTAL AUTHORITIES MAY IMPOSE CONDITIONS FOR
GRANTING APPROVAL. WE CANNOT PREDICT WHETHER WE WILL OBTAIN THE REQUIRED
REGULATORY APPROVALS WITHIN THE TIME FRAME CONTEMPLATED BY THE MERGER AGREEMENT
OR ON CONDITIONS THAT WOULD NOT BE DETRIMENTAL TO FIRST AMERICAN, SOUTHTRUST OR
THE SURVIVING CORPORATION. WE CANNOT BE SURE THAT THE UNITED STATES DEPARTMENT
OF JUSTICE OR A STATE ATTORNEY GENERAL WILL NOT CHALLENGE THE MERGER.

         We may amend the Merger Agreement at any time before the Merger
actually takes place, and may agree to extend the time within which any action
required by the Merger Agreement is to take place. However, if an amendment
would change the amount or form of what First American's shareholders would
receive in the merger, the amendment will have to be approved by our
shareholders. See "THE MERGER -- Regulatory Approvals and Certain Other
Conditions to the Merger; Waiver and Amendment."

  Termination

         The Merger Agreement may be terminated and the Merger abandoned at any
time prior to the Effective Time of the Merger in any of the following ways:

         -        by the mutual consent in writing of SouthTrust, ST-Sub, 
                  ST-Bank and First American;

         -        by SouthTrust, ST-Sub, ST-Bank or First American if the
                  Merger has not occurred on or prior to February 28, 1999, but
                  only if the party electing to terminate is not in breach of
                  the Merger Agreement;

         -        by SouthTrust or First American (if the terminating party is
                  not then in breach of any representation, warranty, covenant
                  or other agreement contained in the Merger Agreement) if any
                  of the conditions to the obligations of the other party to
                  consummate the Merger cannot be satisfied or fulfilled;

         -        by SouthTrust if SouthTrust determines that certain
                  materially adverse events or conditions exist or there is any
                  litigation or threat of litigation regarding the Merger
                  Agreement or the transactions proposed by the Merger
                  Agreement;

         -        by First American if First American determines that certain
                  materially adverse events or conditions exist or there is any
                  litigation or threat of litigation regarding the Merger
                  Agreement or the transactions proposed by the Merger
                  Agreement;

         -        by majority vote of the members of the entire Board of
                  Directors of First American if certain criteria with respect
                  to the average daily last sales prices of SouthTrust Common
                  Stock are not met, see "THE MERGER - Possible Conversion
                  Ratio Adjustment;" or


                                      10
<PAGE>   14

         -        by First American if (1) First American receives a bona fide
                  offer or proposal from a third party, (2) the Board of
                  Directors of First American believes in good faith, after
                  consulting with its financial advisor, that the Third Party
                  proposal would result in a superior financial transaction for
                  First American shareholders, and (3) outside counsel to First
                  American provides a written opinion to the Board of Directors
                  of First American to the effect that the First American
                  Directors would breach their fiduciary duties if they did not
                  terminate the Merger Agreement and enter appropriate
                  agreements with the third party.

         If the Merger Agreement is terminated, then the only liability or
obligation that will continue under the Merger Agreement (other than a possible
termination fee) will be liability by a breaching party for an uncured willful
breach of any representations, warranties, covenants or other agreements
leading to the termination. Furthermore, First American shall pay to SouthTrust
a cash amount of $500,000 as an agreed-upon termination fee as the sole and
exclusive remedy against First American if (1) First American receives an offer
or proposal to enter an acquisition transaction with a third party, (2) the
Merger Agreement and the Merger are then not consummated, and (3) First
American consummates or agrees to consummate an acquisition transaction with a
third party within one year of termination of the Merger Agreement (or the date
the acquisition transaction is offered to First American, whichever is later).

  No Solicitation

         First American has agreed that it will not, through any director or
officer or other agent, solicit or encourage any acquisition proposal by any
person. First American must promptly notify SouthTrust if it receives any
inquiry or proposal relating to any acquisition transaction.

         However, First American may furnish information to a third party which
has initiated the possibility of a transaction with First American and has
expressed an intention to make a bona fide offer or proposal to First American
to acquire First American. First American may then negotiate and take other
appropriate actions with such third party if the Board of Directors of First
American believes in good faith, after consulting with its financial advisor,
that such actions would result in a superior financial transaction for First
American shareholders. In such a situation, outside counsel to First American
must provide a written opinion to the Board of Directors of First American to
the effect that First American Directors would breach their fiduciary duties by
failing to furnish such information or to negotiate or enter agreements with
the third party.

CERTAIN FEDERAL INCOME TAX CONSEQUENCES

         We have structured the Merger so that SouthTrust, First American and
First American's shareholders should not recognize any gain or loss for federal
income tax purposes in the Merger, except for taxes payable because of cash
received by First American shareholders instead of fractional SouthTrust shares
or pursuant to the exercise of dissenters' rights as described in this Proxy
Statement/Prospectus.

         YOUR FEDERAL, STATE AND LOCAL TAX CONSEQUENCES MAY VARY DEPENDING UPON
YOUR PARTICULAR CIRCUMSTANCES. WE URGE YOU TO CONSULT YOUR OWN TAX ADVISORS
CONCERNING THE FEDERAL, STATE, LOCAL, FOREIGN AND OTHER TAX CONSEQUENCES OF THE
MERGER IN YOUR PARTICULAR CIRCUMSTANCES.


RIGHTS OF DISSENT AND APPRAISAL

         Holders of First American Common Stock who do not vote in favor of the
Merger and who follow certain procedures provided by law will be entitled to
dissenters rights. The text of the pertinent statutory provisions is attached
as Exhibit C. If you have a beneficial interest in shares of First American
Common Stock that is held of record in the name of another person, such as a
broker or nominee, you must act promptly to cause the record holder to follow
the necessary steps properly and in a timely manner to perfect whatever
dissenters' rights you may have. See "THE MERGER -- Rights of Dissent and 
Appraisal."

COMPARATIVE STOCK PRICES

         The SouthTrust Common Stock is quoted on NASDAQ under the symbol SOTR.
As of September 30, 1998, SouthTrust had approximately 15,500 holders of record
of SouthTrust Common Stock. As of September 30, 1998, First American had
approximately 140 holders of record of First American Common Stock. First
American Common Stock is not traded on any exchange, and there is no
established public trading market for such stock. There are no bid or asked
prices available for First American Common Stock. Management of First American
is aware of certain transactions in First American Common Stock that have
occurred since January 1, 1996. Although the prices of all transactions are not
known, management of First American believes that such prices ranged from


                                      11
<PAGE>   15

$32.00 to $36.00 per share of First American Common Stock. No assurance can be
given that these trades were effected on an arm's-length basis. Transactions in
First American Common Stock are infrequent and are negotiated privately between
persons involved in those transactions.

         The following table sets forth applicable last sales prices, and pro
forma equivalents based upon such last sales prices, for SouthTrust Common
Stock as of selected dates.

<TABLE>
<CAPTION>
                                                      SouthTrust              First American
                                                     Common Stock              Common Stock
                                                   Last Sales Price            Equivalent(1) 
                                                   ----------------           --------------  
         <S>                                       <C>                        <C>   

         July 2, 1998(2)                           $      44.75               $     84.44
         ________, 1998(3)                                   --                        --   
</TABLE>
     
- ---------

(1)      Proforma equivalents calculated using the last sales price for
         SouthTrust Common Stock as of the selected date multiplied by the
         Conversion Ratio of 1.887.
(2)      Last trading day preceding public announcement of the proposed 
         transaction.
(3)      Most recent date practicable preceding the date of this Proxy
         Statement/Prospectus.

         See "MARKET PRICE AND DIVIDEND INFORMATION RESPECTING THE SOUTHTRUST
COMMON STOCK AND THE FIRST AMERICAN COMMON STOCK."

RESALE OF SOUTHTRUST COMMON STOCK RECEIVED IN THE MERGER

         SouthTrust has registered the shares of SouthTrust Common Stock to be
issued pursuant to the Merger Agreement under the Securities Act. Therefore you
may sell such shares without restriction unless you are deemed to be an
"affiliate" (as defined under the Securities Act) of First American or you
become an affiliate of SouthTrust. If you are an affiliate, then you can resell
the shares of SouthTrust Common Stock only pursuant to an effective
registration statement, pursuant to Rule 145 under the Securities Act, or in
transactions otherwise exempt from registration under the Securities Act.
SouthTrust will not be obligated and does not intend to register its shares
under the Securities Act for resale by shareholders who are affiliates.

         Each affiliate of First American has executed and delivered to
SouthTrust a written agreement restricting the transfer of shares of SouthTrust
Common Stock received by such affiliate in the Merger. Affiliates must resell
their SouthTrust Common Stock in compliance with the securities laws, and may
not sell their SouthTrust Common Stock until such time as financial results
covering at least thirty (30) days of combined operations of First American and
SouthTrust have been published (within the meaning of Section 201.01 of the
Commission's Codification of Financial Reporting Policies).

         See "THE MERGER -- Resale of SouthTrust Common Stock Received in the
Merger."

DIFFERENCES IN RIGHTS OF FIRST AMERICAN SHAREHOLDERS

         Once the Merger occurs, First American shareholders will become
SouthTrust stockholders. As a result, your rights as a shareholder, which now
are governed by Florida corporate law and First American's Articles of
Incorporation and Bylaws, will be governed by Delaware corporate law and
SouthTrust's Restated Certificate of Incorporation and Bylaws. Because of
certain differences between the provisions of Florida corporate law and
Delaware corporate law and of First American's Articles of Incorporation and
Bylaws and SouthTrust's Restated Certificate of Incorporation and Bylaws, your
current rights will change after the Merger. Some of these differences include
anti-takeover provisions. See "COMPARISON OF THE SOUTHTRUST COMMON STOCK AND
THE FIRST AMERICAN COMMON STOCK."

ACCOUNTING TREATMENT

         SouthTrust will account for the Merger as a pooling of interests.  See
"THE MERGER -- Accounting Treatment."

CAUTIONARY STATEMENT CONCERNING FORWARD-LOOKING INFORMATION

         We have made certain forward-looking statements in this document that
are subject to risks and uncertainties. Forward-looking statements include the
information concerning the financial condition, results of


                                      12
<PAGE>   16

operations, plans, objectives, future performance and business of each of
SouthTrust and First American set forth in the following sections: "SUMMARY --
The Merger," "SUMMARY -- Comparative Stock Prices," "THE MERGER -- Background
of and Reasons for the Merger," "THE MERGER -- Effective Time of the Merger,"
"THE MERGER -- Business and Management of First American Following the Merger;
Plans for Business of First American," "Market Price and Dividend Information
Respecting the SouthTrust Common Stock and the First American Common Stock" and
"First American Management's Discussion and Analysis of Financial Condition and
Results of Operations." Forward-looking statements include statements preceded
by, followed by or that include the words "believes," "expects," "anticipates,"
"estimates," or similar expressions. For those statements, we claim the
protection of the safe harbor for forward-looking statements contained in the
Private Securities Litigation Reform Act of 1995. You should understand that
the following important factors, in addition to those discussed elsewhere in
this document and the documents we incorporate by reference, could affect the
future results of SouthTrust and First American and could cause those results
to differ materially from those expressed in our forward-looking statements: we
may not fully realize anticipated operating efficiencies; we may lose deposits,
customers or revenues after the merger; competitive pressure in the banking
industry, negative changes in general economic conditions or changes in banking
regulation could affect our operations; changes in interest rates could reduce
our operating margins; and changes may occur in the securities markets.

EQUIVALENT SHARE DATA

         The following summary presents comparative historical and pro forma
unaudited per share data for both SouthTrust and First American. The pro forma
amounts assume the Merger had been effective during the periods presented and
had been accounted for as a pooling of interests. SouthTrust's pro forma
amounts represent the combined pro forma results, and First American pro forma
equivalent amounts are computed by multiplying the combined pro forma amounts
by a factor of 1.887, to reflect the Conversion Ratio in the Merger. The data
presented should be read in conjunction with the historical financial
statements and the related notes thereto included elsewhere herein or
incorporated by reference herein.

<TABLE>
<CAPTION>


                                                                Years Ended                Six Months Ended
                                                               December 31,                    June 30,  
                                                    -------------------------------     ---------------------      
                                                      1997         1996       1995         1998        1997  
                                                    --------    --------    -------     --------    ---------

<S>                                                 <C>         <C>         <C>         <C>         <C>   
Net income per diluted common share:
         SouthTrust............................     $   2.03    $   1.79    $  1.57     $   1.09    $    0.98
         First American........................         2.74        1.87       2.90         1.51         1.38
         SouthTrust pro forma combined.........         2.03        1.79       1.57         1.09         0.98
         First American pro forma equivalent...         3.83        3.38       2.96         2.06         1.85

Cash dividends per common share:
         SouthTrust............................         0.67        0.59       0.53         0.38         0.33
         First American........................         0.00        0.00       0.00         0.00         0.00
         SouthTrust pro forma combined(1)......         0.67        0.59       0.53         0.38         0.33
         First American pro forma equivalent...         1.26        1.11       1.00         0.72         0.63

Book value per common share (period end):
         SouthTrust............................        14.28       12.03      10.85        15.65        13.05
         First American........................        36.23       33.56      32.05        37.58        34.86
         SouthTrust pro forma combined.........        14.29       12.04      10.86        15.65        13.06
         First American pro forma equivalent...        27.96       22.72      20.50        29.54        24.64
</TABLE>

- ---------------------

(1) SouthTrust pro forma combined dividends represent historical cash dividends
    of SouthTrust.


                                      13
<PAGE>   17

SELECTED FINANCIAL DATA

         The following tables set forth certain selected historical
consolidated financial information for First American and SouthTrust. The
historical income statement data included in the selected financial data for
the five most recent fiscal years are derived from audited consolidated
financial statements of First American and SouthTrust. The financial data for
the interim periods ended June 30, 1998 and June 30, 1997 are derived from the
unaudited historical financial statements of SouthTrust and First American,
respectively, and reflect in the respective opinions of management of
SouthTrust and First American, all adjustments (consisting only of recurring
adjustments) necessary for a fair presentation of such data. This information
should be read in conjunction with the financial statements of First American
and consolidated financial statements of SouthTrust, and the related notes
thereto, contained in documents included elsewhere in this Proxy Statement/
Prospectus or incorporated herein by reference. See "FINANCIAL STATEMENTS OF
FIRST AMERICAN" and "WHERE YOU CAN FIND MORE INFORMATION."

                    SOUTHTRUST CORPORATION AND SUBSIDIARIES

<TABLE>
<CAPTION>
                                                                                                                      
                                                                      Years Ended December 31,                        
                                                   --------------------------------------------------------------     
                                                     1997          1996         1995         1994          1993       
                                                   ---------    ---------    ---------     --------      --------     

<S>                                               <C>          <C>          <C>           <C>          <C>    
INCOME STATEMENT DATA
  (in thousands, except per share data):
  Interest income....................             $ 2,232,252  $ 1,804,220  $ 1,484,623   $ 1,108,612  $   927,551      
  Interest expense...................               1,186,079      938,194      791,423       501,067      397,743      
                                                  -----------  -----------  -----------   -----------  -----------      
    Net interest income..............               1,046,173      866,026      693,200       607,545      529,808      
  Provision for loan losses..........                  90,613       90,027       61,286        44,984       45,032      
                                                  -----------  -----------  -----------   -----------  -----------      
  Net interest income after                                                                                           
    provision for loan losses........                 955,560      775,999      631,914       562,561      484,776      
  Non-interest income................                 270,507      254,809      208,664       184,778      174,702      
  Non-interest expense...............                 748,216      643,298      536,534       485,999      434,951      
                                                  -----------  -----------  -----------   -----------  -----------      
  Income before income taxes.........                 477,851      387,510      304,044       261,340      224,527      
  Income taxes.......................                 171,143      132,807      105,039        88,338       73,992      
                                                  -----------  -----------  -----------   -----------  -----------      
    Net income.......................             $   306,708  $   254,703  $   199,005   $   173,002  $   150,535      
                                                  ===========  ===========  ===========   ===========  ===========      
                                                                                                                      
                                                                                                                      
  Net income per diluted common share             $      2.03  $      1.79  $      1.57   $      1.43  $      1.29      
  Cash dividends declared                                                                                             
    per common share.................                    0.67         0.59         0.53          0.45         0.40      
  Average diluted common shares outstanding                                                                           
    (in thousands)...................                 151,008      142,154      126,687       121,157      117,027      
                                                                                                                      
                                                  
BALANCE SHEET DATA (at period end) 
  (in thousands):
  Total assets.......................             $30,906,445  $26,223,193  $20,787,024   $17,632,059  $14,707,964    
  Total loans, net...................              22,159,314   19,061,269   14,448,524    11,950,215    9,313,086    
  Total deposits.....................              19,586,584   17,305,493   14,575,077    12,801,239   11,515,311    
  Total stockholders' equity.........               2,194,641    1,734,892    1,430,870     1,135,268    1,051,766    
</TABLE>

                                          
<TABLE>
<CAPTION>
                                                        Six Months
                                                      Ended June 30,    
                                                ------------------------
                                                    1998         1997   
                                                -----------  -----------

<S>                                             <C>          <C>   
INCOME STATEMENT DATA
  (in thousands, except per share data):
  Interest income....................           $ 1,233,406  $ 1,068,836    
  Interest expense...................               666,986      562,255    
                                                -----------  -----------    
    Net interest income..............               563,420      506,581    
  Provision for loan losses..........                43,336       48,877    
                                                -----------  -----------    
  Net interest income after                                               
    provision for loan losses........               520,084      457,704    
  Non-interest income................               181,263      126,024    
  Non-interest expense...............               435,419      356,199    
                                                -----------  -----------    
  Income before income taxes.........               265,928      227,529    
  Income taxes.......................                89,984       81,262    
                                                -----------  -----------    
    Net income.......................           $   175,944  $   146,267    
                                                ===========  ===========    
                                                                          
                                                                          
  Net income per diluted common share           $      1.09  $      0.98    
  Cash dividends declared                                                 
    per common share.................                  0.38         0.33    
  Average diluted common shares outstanding                    
    (in thousands)...................               161,363      149,190    
                                                                          
                                              
BALANCE SHEET DATA (at period end) 
  (in thousands):
  Total assets.......................           $34,667,937  $29,192,946
  Total loans, net...................            24,300,039   20,808,177
  Total deposits.....................            21,150,845   18,679,409
  Total stockholders' equity.........             2,576,790    1,951,759
</TABLE>


                              FIRST AMERICAN BANK

<TABLE>
<CAPTION>
                                                                                                               Six Months
                                                             Years Ended December 31,                         Ended June 30,    
                                        ------------------------------------------------------------     ----------------------
                                           1997         1996        1995         1994         1993          1998         1997   
                                        ---------    ---------   ---------     --------     --------     ---------    ---------

<S>                                     <C>          <C>         <C>           <C>          <C>          <C>           <C>        
INCOME STATEMENT DATA 
  (in thousands, except per share data):
  Interest income...................    $    3,359   $   3,011   $   2,865     $  2,631     $  2,467     $   1,769     $    1,668
  Interest expense..................         1,342       1,302       1,197          956          897           747            672
                                        ----------   ---------   ---------     --------     --------     ---------     ----------
    Net interest income.............         2,017       1,709       1,668        1,675        1,570         1,022            996
  Provision (credit) for loan losses           108          32          33           45            0            65             33
                                        ----------   ---------   ---------     --------     --------     ---------     ----------
  Net interest income after
    provision for loan losses.......         1,909       1,677       1,635        1,630        1,570           957            963
  Non-interest income...............           225         160         148          151          185           131             98
  Non-interest expense..............         1,586       1,456       1,247        1,182        1,076           783            774
                                        ----------   ---------   ---------     --------     --------     ---------     ----------
  Income before income taxes........           548         381         536          599          679           305            287
  Income taxes......................           197         146         176          215          255           110            111
                                        ----------   ---------   ---------     --------     --------     ---------     ----------

  Net income .......................    $      351   $     235   $     360     $    384     $    424     $     195     $      176
                                        ==========   =========   =========     ========     ========     =========     ==========

  Net income per diluted common share   $     2.74   $    1.87   $    2.90     $   3.11     $   3.44     $    1.51     $     1.38
  Cash dividends declared
    per common share................             0           0           0            0            0             0              0
  Average diluted common shares
  outstanding (in thousands)........           129         126         124          124          123           129            128

BALANCE SHEET DATA (at period end) 
  (in thousands):
  Total assets......................    $   44,295   $  39,074   $  35,628     $ 32,597     $ 32,806     $  45,385     $   42,091
  Total loans, net..................        29,583      26,958      23,238       23,811       24,230        30,032         29,056
  Total deposits....................        39,412      34,614      31,465       28,803       29,367        40,332         37,432
  Total stockholders' equity........         4,640       4,212       3,984        3,585        3,240         4,843          4,445
</TABLE>


                                      14
<PAGE>   18

SELECTED PRO FORMA INFORMATION

         The following table sets forth certain unaudited pro forma combined
condensed financial information for SouthTrust and First American giving effect
to the Merger. The unaudited pro forma combined condensed financial
presentation is presented for information purposes only and is not necessarily
indicative of the combined financial position or results of operations which
would actually have occurred if the transaction had been consummated in the
past or which may be obtained in the future. This information should be read in
conjunction with the financial statements of First American and consolidated
financial statements of SouthTrust and the related notes thereto included
elsewhere in this Proxy Statement/Prospectus or incorporated in this Proxy
Statement/Prospectus by reference. See "FINANCIAL STATEMENTS OF FIRST AMERICAN"
and "WHERE YOU CAN FIND MORE INFORMATION."

                         PRO FORMA COMBINED INFORMATION
                 SOUTHTRUST CORPORATION AND FIRST AMERICAN BANK

<TABLE>
<CAPTION>
                                                                                      Six Months Ended
                                                  Years Ended December 31,                 June 30, 
                                            ------------------------------------   -----------------------      
                                               1997         1996         1995         1998         1997  
                                            ----------   ----------   ----------   ----------   ---------- 

<S>                                         <C>          <C>          <C>          <C>          <C>   
INCOME STATEMENT DATA
 (in thousands, except per share data):
Interest income .........................   $2,235,611   $1,807,231   $1,487,488   $1,235,175   $1,070,504
Interest expense ........................    1,187,421      939,496      792,620      670,733      562,927
                                            ----------   ----------   ----------   ----------   ----------
  Net interest income ...................    1,048,190      867,735      694,868      564,442      507,577
Provision for loan losses ...............       90,721       90,059       61,319       43,401       48,910
                                            ----------   ----------   ----------   ----------   ----------
Net interest income after provision for
  loan losses ...........................      957,469      777,676      633,549      521,041      458,667
Non-interest income .....................      270,732      254,969      208,812      181,394      126,122
Non-interest expense ....................      749,802      644,754      537,781      436,202      356,973
                                            ----------   ----------   ----------   ----------   ----------
Income before income taxes ..............      478,399      387,891      304,580      266,233      227,816
Income taxes ............................      171,340      132,953      105,215       90,094       81,373
                                            ----------   ----------   ----------   ----------   ----------
  Net income ............................   $  307,059   $  254,938   $  199,365   $  176,139   $  146,443
                                            ==========   ==========   ==========   ==========   ==========

Net income per diluted common share .....   $     2.03   $     1.79   $     1.57   $     1.09   $     0.98
Average diluted common shares outstanding
(in thousands) ..........................      151,251      142,392      126,921      161,606      149,432

BALANCE SHEET DATA
   (in millions)
Total assets ............................   $   30,950   $   26,262   $   20,823   $   34,713   $   29,235
Total loans, net ........................       22,189       19,088       14,472       24,330       20,837
Total deposits ..........................       19,626       17,340       14,606       21,191       18,716
Total stockholders' equity ..............        2,200        1,739        1,435        2,582        1,957
</TABLE>


                                      15
<PAGE>   19

                                   THE MERGER

         The terms of the Merger are set forth in the Merger Agreement. The
         description of the Merger which follows summarizes the principal
         provisions of the Merger Agreement, is not complete and is qualified
         in all respects by reference to the Merger Agreement, a copy of which
         is attached as Exhibit A , and certain provisions of the National Bank
         Act relating to the rights of dissenting shareholders, a copy of which
         is attached hereto as Exhibit C. All First American shareholders are
         urged to read the Merger Agreement and the Exhibits in their entirety.


GENERAL

         The Merger Agreement has been approved by the Boards of Directors of
First American, SouthTrust, ST-Sub and ST-Bank, by SouthTrust as the sole
shareholder of ST-Sub and by ST-Sub as the sole shareholder of ST-Bank. The
stockholders of SouthTrust are not required to approve the Merger.

         If First American shareholders approve the Merger Agreement at the
Special Meeting, if required regulatory approvals are received and if other
conditions are satisfied, then, First American will be merged with and into
ST-Bank pursuant to the Merger Agreement, the Florida Banking Code and the
National Bank Act, and ST-Bank will be the Surviving Corporation. At the
Effective Time of the Merger, pursuant to the Merger Agreement, SouthTrust is
to issue up to a total of 253,546 shares of SouthTrust Common Stock for all of
the issued and outstanding shares of First American Common Stock (assuming that
no dissenters' rights of appraisal are exercised in the Merger and assuming the
exercise of all First American Options that are exercisable). As of the date of
the Merger Agreement, a total of 128,865 shares of First American Common Stock
were issued and outstanding. Options to purchase up to 5,500 shares of First
American Common Stock were also outstanding. If the options are not exercised
before the Effective Time of the Merger, then they will be assumed by
SouthTrust and converted into options exercisable for shares of SouthTrust 
Common Stock.

         At the Effective Time of the Merger, each share (except (1) shares
held by First American or by SouthTrust or any of its subsidiaries, in each
case other than in a fiduciary capacity or as a result of debts previously
contracted, and (2) shares dissenting from approval of the Merger Agreement) of
First American Common Stock, will become and be converted into the right to
receive 1.887 shares of SouthTrust Common Stock, as the same may be adjusted
pursuant to the terms of the Merger Agreement. See "THE MERGER -- Effect of the
Merger on First American Common Stock."

         If the average of the daily last sales prices of SouthTrust Common
Stock (the "Average Closing Price") as reported on NASDAQ for the ten
consecutive full trading days in which such shares are traded on the NASDAQ
during the ten-trading-day period ending on the date that this Proxy Statement
is mailed to the shareholders of First American (the "Determination Period") is
less than $41.1127, the Average Closing Price on June 26, 1998, and the
percentage decline in such Average Closing Price since July 1, 1998, is greater
than the percentage decline in a weighted average price of common stock of an
Index Group of bank holding companies as provided in the Merger Agreement, then
First American will have the right to elect to terminate the Merger Agreement
unless SouthTrust elects to increase the Conversion Ratio in the manner
described under "THE MERGER -- Possible Conversion Ratio Adjustment."

         The Conversion Ratio, including the number of shares of SouthTrust
Common Stock issuable in the Merger, is also subject to appropriate adjustment
in the event of certain stock splits, stock dividends, reclassifications or
similar distributions effected by SouthTrust.

         All rights with respect to shares of First American Common Stock
issuable pursuant to the exercise of stock options ("First American Options")
granted by First American under stock option plans of First American (the
"First American Stock Option Plans"), and held by each participant under the
plans, shall be converted into, as of the Effective Time of the Merger, the
right of the holders of First American Options to receive shares of SouthTrust
Common Stock. See "THE MERGER -- Effect of Merger on Stock Options."


                                      16
<PAGE>   20

         No fractional shares of SouthTrust Common Stock will be issued in the
Merger, and, instead, each holder of shares of First American Common Stock that
otherwise would have been entitled to receive a fractional share of SouthTrust
Common Stock will be entitled to receive a cash payment in an amount equal to
(1) the fractional interest of a share of SouthTrust Common Stock to which such
holder otherwise would have been entitled, multiplied by (2) the last sales
price of SouthTrust Common Stock as reported by NASDAQ on the last trading day
preceding the Effective Time of the Merger or on the date of exercise in the
case of First American Options to be exercised for SouthTrust Shares.

         The Merger will become effective on the date and at the time on which
the Merger is deemed effective by the Comptroller. The Merger Agreement
provides that, unless otherwise mutually agreed upon in writing, the parties to
the Merger Agreement will use their reasonable efforts to cause the effective
time to occur as soon as practicable following the later to occur of (1) the
effective date (including expiration of any applicable waiting period) of the
last required consent of any regulatory authority having authority over and
approving or exempting the Merger, and (2) the date on which the shareholders
of First American approve the Merger Agreement, or such other time as the
parties may agree. See "THE MERGER -- Effective Time of the Merger."


BACKGROUND OF AND REASONS FOR THE MERGER

  Background of the Merger

         From time to time over the past several years, the directors of First
American had discussions regarding the prospects of First American, conditions
in the community banking market in Florida, and the merger activity among
financial institutions in the state. In November 1997, the Board of Directors
of First American invited Ewing to make a presentation to the Board at an
informal workshop concerning the current market for community banks in Florida
and, specifically, Ewing's judgment as to the range of value that an interested
acquiror might offer for First American. Representatives of Ewing met with
First American's directors on December 3, 1997. At the meeting, the Ewing
representatives and the Board discussed First American, the financial
institutions industry in Florida, the range of prices that had been paid for
sales of financial institutions over recent periods, the Board's desire to
provide liquidity for First American Common Stock, the risk that the prices
being received for sales of financial institutions in the prevailing market
could decline over the ensuing years, the trend in the financial institutions
industry for consolidation, the opportunities that bank mergers presented to
First American, and the financial institutions that might have an interest in
pursuing a transaction with First American. The Board also considered the
increasingly competitive banking environment in which First American operates,
the increased competition in both deposit and lending activities, and the
inherent risk in relying on future First American growth and market
penetration.

         While not making any final decision whether any transaction involving
a sale of First American should be entered into, the Board of Directors
authorized First American to retain Ewing to represent First American in
soliciting indications of interest that might warrant serious consideration and
potentially result in an agreement to merge or First American otherwise being
acquired. Subsequent to the meeting, First American entered into an agreement
with Ewing on January 20, 1998. Thereafter and with the assistance of First
American management, Ewing prepared a confidential memorandum regarding First
American. In February and March 1998, Ewing solicited interest from a variety
of larger financial institutions whose operating strategy included the
acquisition of banks on Florida's Treasure Coast. As a part of this process,
SouthTrust entered into a confidentiality agreement with First American on
March 9, 1998.

         On April 20, 1998, First American received a letter of intent from
SouthTrust with respect to a proposed transaction. The letter of intent was
reviewed by the First American Board at a special meeting held on April 21,
1998. Following review of the letter of intent, the directors authorized Mr.
Robert J. MacWilliam (President and Chief Executive Officer of First American)
to invite Mr. Benjamin C. Bishop, Jr. (Chairman of Ewing) to meet with the
First American Board at a special meeting to be held on April 27, 1998 to
review the SouthTrust letter of intent, as well as indications of interest
received through Ewing's solicitation process. At the meeting of the Board held
on April 27, 1998, Mr. Bishop of Ewing reviewed Ewing's solicitation process.
Mr. Bishop indicated that Ewing 


                                      17
<PAGE>   21

initially received indications of interest from approximately six financial
institutions, including thrifts, and, upon further negotiations, three
institutions, including SouthTrust, expressed specific interest in providing a
proposal for the acquisition of First American. All three proposals provided
for, among other things, a proposed exchange ratio of the acquirer's shares for
First American Common Stock with the transaction structured to provide the
shareholders of First American with a tax-free merger. Ewing reviewed the three
proposals with First American directors. Following the presentation, the Board
decided to authorize Ewing to continue discussions with SouthTrust regarding a
possible acquisition of First American by SouthTrust. The Board also authorized
the signing of the SouthTrust letter of intent, with certain revisions which
might provide First American additional rights in the event of certain
decreases in SouthTrust Common Stock during the pendency of the acquisition
transaction over decreases in the stocks of certain select financial
institutions. The directors elected to pursue a transaction with SouthTrust
because the indicated price and terms reflected in the SouthTrust proposal were
superior to the terms proposed by the other two interested parties.

         In May and June 1998, representatives of SouthTrust and
representatives of First American negotiated the terms of a definitive
agreement. The agreement was reviewed by the Board of Directors of First
American at a meeting held on June 25, 1998. At this meeting, legal counsel
reviewed generally for First American's directors the fiduciary obligations of
directors in sales of financial institutions and commented on the form of
definitive agreement, the agreement to be entered into by First American's
directors and the treatment in the Merger of outstanding First American
Options. The agreement was further reviewed by the Directors of First American
at a subsequent meeting held on June 26, 1998. At the meeting, representatives
of Ewing rendered an oral opinion that the consideration to be paid by
SouthTrust for the First American Common Stock is fair, from a financial point
of view, to the shareholders of First American. First American's board then
unanimously approved the Agreement and the transactions contemplated thereby.
First American management also was authorized to execute the Agreement, which
was signed by SouthTrust and First American effective July 1, 1998.

         First American's Board of Directors believes that the Merger is in the
best interest of First American shareholders. The Board of Directors at First
American considered a number of factors in deciding to approve and recommend
the terms of the Merger to First American shareholders, including the
following:

         -        terms of the proposed transaction;

         -        the financial condition, results of operations, and future
                  prospects of First American;

         -        the value of the consideration to be received by First
                  American shareholders relative to the book value and earnings
                  per share of First American Common Stock;

         -        the competitive and regulatory environment for financial
                  institutions generally;

         -        the fact that the Merger will enable First American
                  shareholders to exchange their shares of First American
                  Common Stock (for which there is no established public
                  trading markets) for shares of common stock of a larger and
                  more diversified entity, the stock of which is more widely
                  held and more actively traded;

         -        that the Merger will enable First American shareholders to
                  hold stock in a financial institution that has historically
                  paid cash dividends to its shareholders as compared to First
                  American, which has not previously paid cash dividends;

         -        the likelihood of receiving the requisite regulatory approval;


                                      18
<PAGE>   22

         -        that it is expected that the Merger will be a tax-free
                  transaction (except with respect to cash received for First
                  American Common Stock) for federal income tax purposes;

         -        and other information.

         The Board of Directors also took into account an opinion received from
Ewing that the consideration to be received by the shareholders of First
American in the Merger is fair from a financial point of view. See "-- Opinion
of Financial Advisor." The foregoing discussion of the information and factors
considered by the First American Board of Directors is not intended to be
exhaustive of the factors considered by the Board of Directors. The First
American Board of Directors did not assign any relative or specific weights to
the foregoing factors, and individual directors may have given different
weights to different factors.

         The 1.887 shares of SouthTrust's Common Stock to be exchanged for each
share of First American Bank's Common Stock reflects prices that were
negotiated on an arm's-length basis between representatives of First American
and representatives of SouthTrust. There was no affiliation, relationship,
understanding or transaction between First American and its representatives, on
one hand, and SouthTrust and ST-Bank, and their representatives, on the other
hand, prior to the execution of the Merger Agreement.

         THE MEMBERS OF THE BOARD OF DIRECTORS OF FIRST AMERICAN HAVE
UNANIMOUSLY APPROVED THE MERGER AGREEMENT AND DETERMINED THAT THE MERGER IS
FAIR, FROM A FINANCIAL POINT OF VIEW, AND IS IN THE BEST INTEREST OF FIRST
AMERICAN SHAREHOLDERS. ACCORDINGLY, THE BOARD OF DIRECTORS OF FIRST AMERICAN
RECOMMENDS THAT SHAREHOLDERS OF FIRST AMERICAN VOTE IN FAVOR OF THE MERGER
AGREEMENT.

         SouthTrust is engaging in the transactions pursuant to the Merger
because the Merger is consistent with its expansion strategy within the
southeastern United States and because the acquisition of First American will
augment SouthTrust's existing market share in the southeastern Florida banking
market and enhance its competitive position in such market.

OPINION OF FINANCIAL ADVISER

Fairness Opinion of Allen C. Ewing & Co.

         The Board of Directors of First American retained Ewing to assist them
in developing and implementing a strategy for marketing First American and for
the purpose of rendering its Opinion (the "Opinion") to the First American
shareholders as to the fairness, from a financial point of view, of the terms
of any transaction resulting from the negotiations. The Board of Directors
selected a proposal by SouthTrust as offering the greatest value and the most
attractive terms to the First American shareholders.

         At the meeting of the First American Board held on May 14, 1998, Ewing
delivered its oral Opinion that subject to certain assumptions and market
conditions, the offer to the First American shareholders in the form of a
tax-free exchange of shares by ST-Sub on behalf of ST-Bank was fair, from a
financial point of view. Ewing's oral Opinion was followed by Ewing's written
Opinion dated June 30, 1998. No limitations were imposed by the Board of
Directors of First American on the scope of Ewing's analysis or the procedures
followed by Ewing in rendering its Opinion. Ewing's Opinion is directed to the
First American Board and does not constitute a recommendation to any First
American shareholder as to how such shareholder should vote on the Merger.
Ewing has not been requested to opine as to, and the Opinion does not in any
manner address, the underlying business decision by the First American Board to
enter into the Merger.

         In issuing its Opinion, Ewing assumed and relied upon the accuracy and
completeness of the financial and other information provided by First American
in arriving at its Opinion. Ewing made no independent verification of the
supplied information, nor did Ewing conduct a physical inspection of the
properties and facilities of First American, nor did Ewing make or obtain any
evaluation or appraisal of the assets or liabilities of First American, nor did
Ewing review any credit or loan files from First American's loan portfolio. The
Opinion is based upon


                                      19
<PAGE>   23

market and economic conditions as they existed on the date of the Opinion.
Events occurring after the date of issuance of the Opinion, including but not
limited to, changes in the market price of securities, the results of
operations, or material changes in the value of the assets or liabilities of
First American could affect Ewing's final opinion which will be issued prior to
closing.

         The full text of Ewing's Opinion is attached as Exhibit B to this
Proxy Statement/Prospectus and is incorporated herein by reference. The
description of the Opinion set forth here is qualified in its entirety by
reference to Exhibit B. We urge First American shareholders to read the Opinion
in its entirety.

         In arriving at its Opinion, Ewing:

         -        reviewed the audited statements prepared by Rex Meighen &
                  Company, Tampa, Florida, for the fiscal year ended December
                  31, 1997, and KPMG Peat Marwick, LLP, Vero Beach, Florida,
                  for the fiscal years ended December 31, 1996, and December
                  31, 1995;

         -        reviewed the Call Reports of First American filed with the
                  regulators reflecting the operations of First American for
                  the periods ended March 31, 1998, December 31, 1997, December
                  31, 1996, and December 31, 1995;

         -        reviewed the Agreement and Plan of Merger dated July 1, 1998;

         -        reviewed the budget for First American for the year 1998;

         -        reviewed the three-year financial objectives for First
                  American (1998-2000);

         -        reviewed other financial information concerning First 
                  American;

         -        compared the values and terms of the Merger Agreement with
                  SouthTrust with the values and terms offered to shareholders
                  of comparable institutions in Florida in recent transactions;

         -        examined First American's market share in the Indian River
                  County market;

         -        compared First American's financial performance with other 
                  comparable banking institutions operating in Florida;

         -        reviewed the financial condition of SouthTrust and the impact
                  of the proposed transaction on the future market price of the
                  shares of SouthTrust Common Stock; and

         -        reviewed the price performance and trading activity in the 
                  shares of SouthTrust Common Stock.

Ewing held discussions with the management of First American concerning its
historical operations and future prospects and the decision of its Board of
Directors to negotiate with SouthTrust.

         The following paragraphs summarize the most pertinent portions of the
financial and comparative analysis prepared by Ewing in arriving at its
Opinion. The following summary is not intended to be a complete description of
the analysis performed or the matters considered by Ewing in arriving at its
Opinion.

         The preparation of a fairness opinion involves various determinations
as to the most appropriate and relevant methods of financial analysis and the
application of those methods to the particular circumstances. Therefore, such
an opinion is not readily susceptible to summary description. Furthermore, in
arriving at its Opinion, Ewing did not attribute any particular weight to any
one factor considered by it, but rather made qualitative judgments as to the
significance and relevance of each analysis and factor. Ewing believes that its
analysis must be considered as a whole and that considering any portions of
such analysis and of the factors considered, without considering all analyses
and factors, could create a misleading or incomplete view of the


                                      20
<PAGE>   24

process underlying its Opinion. In its analysis, Ewing made numerous
assumptions with respect to industry performance, general business and economic
conditions and other matters, many of which are beyond First American's
control. Any estimates contained in these analyses are not necessarily
indicative of actual values or predictive of future results or values, which
may be significantly more or less favorable than as set forth therein. Analyses
relating to the value of businesses do not purport to be appraisals or to
reflect the specific prices at which businesses may be sold. Ewing's Opinion,
along with Ewing's presentations to the First American Board, were just one of
many factors taken into consideration by the First American Board in reaching
its decision to recommend a merger with ST-Bank to the First American
shareholders.

Trading History of First American Common Stock. As the shares of First American
Common Stock are closely held, Ewing confirmed that there was no meaningful
trading market in the shares of First American Common Stock.

Selection of Valuation Method. In valuing financial institutions, Ewing
believes that there are several methods available to determine if a prospective
transaction is fair, from a financial point of view, to the shareholders of the
institution to be acquired. These methods include:

         (1) Comparison Method: A comparison of the purchase price of the
         transaction with prices paid for similar banks during periods of
         similar economic activity and bank valuations based on ratios commonly
         used in the industry including price/book, price/earnings, and
         price/deposits.

         (2) Control Premium Method: This method only applies to companies
         where there is a public market for their shares, and, as there is not
         an active market for the shares of First American Common Stock, this
         method is not applicable.

         (3) Net Asset or Liquidating Value Method: This method does not apply
         to healthy banks and is only used in periods of severely depressed
         markets.

         (4) Discounted Cash Flow Method: This method is often used in valuing
         community banks for the primary purpose of confirming valuations
         determined by the Comparison or other Methods. The method is based on
         management's forecast of earnings and dividends, if projected, for a
         period of years with an estimate of the amount of a projected sale of
         the bank at the end of the period. The present value of these
         projected cash flows was determined using discount rates reflecting
         the perceived risks and accuracy of the projections. Earnings for
         small banks can be volatile because of the expenses associated with
         the addition of a new branch, a new marketing program, the hiring of
         new banking officers, etc. which can have an adverse short-term affect
         on earnings. Earnings projections for smaller banks, for these
         reasons, tend to have less reliability, and this reduces the value of
         the Discounted Cash Flow Method in determining market value.

         Ewing believes that the Comparison Method is the soundest choice for
determining the fairness of this transaction, and that the Discounted Cash Flow
Method is useful in confirming the valuations determined by the Comparison
Method.

Analysis of Comparable Companies.  Using industry information including
information prepared by SNL Securities, Ewing compared the financial
performance of First American with two relevant groups of banks. In the first
group, Ewing compared performance indicators of First American with the average
performance of the 217 independent community banks in Florida (the "Florida
Banks").


                                      21
<PAGE>   25

<TABLE>
<CAPTION>
- ----------------------------------------------------------------------------------------------------------------
      PERFORMANCE INDICATOR                           FIRST AMERICAN                     THE FLORIDA BANKS
- ----------------------------------------------------------------------------------------------------------------
<S>                                                   <C>                                <C>   
Return on Average Assets                                    .63%                               1.02%
- ----------------------------------------------------------------------------------------------------------------
Return on Average Equity                                   8.39%                              11.00%
- ----------------------------------------------------------------------------------------------------------------
Equity / Assets                                            7.47%                               9.25%
- ----------------------------------------------------------------------------------------------------------------
Non-Performing Assets/Assets                                .14%                                .36%
- ----------------------------------------------------------------------------------------------------------------
</TABLE>


These comparisons indicated a lower rate of profitability for First American.

         In the second group, Ewing compared performance indicators of First
American with the average performance indicators of eleven comparable banks
which were merged with larger companies in 1997 and 1998 (the "Comparable
Banks").

<TABLE>
<CAPTION>
- ----------------------------------------------------------------------------------------------------------------
      PERFORMANCE INDICATOR                           FIRST AMERICAN                     COMPARABLE BANKS
- ----------------------------------------------------------------------------------------------------------------
<S>                                                   <C>                                <C>   
Return on Average Assets                                    .63%                               1.24%
- ----------------------------------------------------------------------------------------------------------------
Return on Average Equity                                   8.39%                              13.88%
- ----------------------------------------------------------------------------------------------------------------
Equity / Assets                                            7.47%                               9.00%
- ----------------------------------------------------------------------------------------------------------------
Non-Performing Assets/Assets                                .14%                                .17%
- ----------------------------------------------------------------------------------------------------------------
</TABLE>

These comparisons also indicated a lower rate of profitability for First
American.

Analysis of Comparable Transactions. Ewing reviewed the terms and financial
characteristics of selected transactions involving the acquisition of banks by
commercial bank holding companies in Florida in 1997 and 1998. Ewing selected
transactions for comparison purposes involving similar sized banks in Florida
in periods of similar economic activity. Ewing determined that the period
commencing January 1, 1997 through March 31, 1998 was the optimum period for
the selection of comparable transactions, as the economy was robust and Florida
banks were enjoying strong growth and profitability.

Because of the large amount of consolidation activity occurring in the Florida
banking market, Ewing determined that there were a sufficient number of
transactions involving comparable banks in Florida to provide a sufficiently
large universe for comparison purposes. There were 36 transactions that
occurred during this period involving Florida banks, and Ewing applied the
following criteria in selecting the most comparable transactions. Ewing
eliminated all transactions involving selling banks with assets less than $50
million and in excess of $100 million. Ewing eliminated all transactions in
which the operations of the acquired bank were unprofitable in the year of
acquisition and all transactions involving banks with non-performing assets in
excess of 1% of assets. Ewing eliminated all transactions where the selling
bank had a Return on Average Assets in the year of acquisition of less than 1%
and/or a Return on Average Equity of less than 8%. Eleven of the 36
transactions met the above criteria, and they included the following
transactions (identified by acquiree/acquiror):


                                      22
<PAGE>   26

CNB Holding Co./Colonial BancGroup
(Montgomery, AL)

Seminole Bank/F.N.B. Corporation
(Hermitage, PA)

Central Bank/BankUnited Financial
(Boca Raton, FL)

Murdock Florida Bank/American Bancshares
(Bradenton, FL)

First Central Bank/Colonial BancGroup
(Montgomery, AL)

West Coast Bank/F.N.B. Corporation
(Hermitage, PA)

Bank of Winter Park/Huntington Bancshares
(Columbus, OH)

Indian Rocks State Bank/F.N.B. Corporation
(Hermitage, PA)

First Independence Bank/Colonial BancGroup
(Montgomery, AL)

Citizens National Bank & Trust/Gulf West Banks
(St. Petersburg, FL)

Universal National Bancorp/Totalbank Corp. (Miami, FL)

Ewing utilized three ratios that are generally utilized in the industry for
comparing prices paid in transactions involving banks.

<TABLE>
<CAPTION>
- ----------------------------------------------------------------------------------------------------------------
               RATIO                             FIRST AMERICAN/ST-BANK               COMPARABLE TRANSACTIONS
- ----------------------------------------------------------------------------------------------------------------
<S>                                              <C>                                  <C>  
Price / Book                                          2.49 times                              2.51 times
- ----------------------------------------------------------------------------------------------------------------
Price / Earnings                                     19.98 times                             19.87 times
- ----------------------------------------------------------------------------------------------------------------
Price as Percentage of Deposits                      24.96%                                  28.00%
- ----------------------------------------------------------------------------------------------------------------
</TABLE>

Because the reasons for and circumstances surrounding each of the transactions
analyzed were diverse and because of the inherent differences between the
operations of First American and the eleven banks in the selected transactions,
Ewing believed that a strict reliance on the quantitative comparable
transaction analysis is not meaningful without further qualitative
considerations. Ewing believed that the proper use of a comparable transaction
analysis involves qualitative judgments concerning differences in the
characteristics of each transaction and the prospective merger of First
American with ST-Bank which may have affected the acquisition value of each of
the acquired companies and First American. The qualitative factors considered
by Ewing in connection with its Opinion included Ewing's views as to the number
of potential buyers in each of these transactions and the ability of the
acquirors to implement cost savings and business synergies as a result of each
merger.

Discounted Cash Flow Analysis.     Ewing projected the cash flows of First
American based on First American's financial objectives for the three-year
period ended December 31, 2000, which assume that First American would remain
an independent bank. For purposes of this Discounted Cash Flow Analysis, Ewing
assumed that the projected dividends would be paid by First American and that
First American would enter into a merger contract as of December 31, 2000, at a
price based on the level of current bank valuations. The derived value as of
December 31, 2000, for First American was discounted to present value utilizing
a discount rate which was determined based on Ewing's estimate of the rate that
investors would require in making an investment based on the projected sale of
First American. Ewing calculated the appropriate discount rate by layering
appropriate risk rates which took into consideration the riskless rate of
Treasury Notes for the indicated time period (three years), the general risks
of equity investment, and the volatility of small bank earnings. Ewing used a
range of 14% to 16% in its calculations of present value.


                                      23
<PAGE>   27

         Based on the Discounted Cash Flow Analysis, Ewing determined that the
present value of the projected cash flows was very similar to the values
represented by the Merger Agreement and that the Discounted Cash Flow Analysis
supported the fairness of the transaction to the First American shareholders.

Analysis of Shares of SouthTrust Common Stock.     Ewing reviewed the
profitability, quality, and liquidity of the shares of SouthTrust Common Stock
including a comparison of SouthTrust's operating performance with the average
of six other regional bank holding companies ("BHCs") including AmSouth,
Colonial, Compass, Regions, Union Planters, and Huntington.

<TABLE>
<CAPTION>
- ----------------------------------------------------------------------------------------------------------------
     PERFORMANCE INDICATOR                            SOUTHTRUST                                 BHCS
- ----------------------------------------------------------------------------------------------------------------
<S>                                                   <C>                                       <C>   
Return on Average Assets                                 1.08%                                   1.24%
- ----------------------------------------------------------------------------------------------------------------
Return on Average Equity                                15.72%                                  15.78%
- ----------------------------------------------------------------------------------------------------------------
Non-Performing Assets/Assets                              .58%                                    .45%
- ----------------------------------------------------------------------------------------------------------------
Equity/Assets                                            7.10%                                   7.89%
- ----------------------------------------------------------------------------------------------------------------
</TABLE>


Marketing of the Bank.    The Board of Directors of First American developed a
marketing program to solicit interest in First American from a selected list of
qualified bank holding companies whose shares were acceptable in terms of
investment value and quality. Ewing assisted the Board of Directors in this
process which resulted in specific interest being expressed by several bank
holding companies, including SouthTrust. The proposal from SouthTrust was
selected by the Board because of the higher market value and more advantageous
terms that it represented.

Compensation of Allen C. Ewing & Co.     Ewing served as financial advisor to 
First American in addition to rendering its Opinion, and First American has
agreed to pay Ewing a total fee equal to 1% of the value of the transaction at
closing. First American agreed to indemnify Ewing against certain liabilities
as delineated in Ewing's agreement with First American.

Experience of Allen C. Ewing & Co.     As a part of its investment banking
business, Ewing is regularly engaged in the valuation of securities in
connection with mergers and acquisitions, underwritings, private placements,
trading and market making activities, and valuations for various other
purposes. First American's Board of Directors engaged Ewing based on its
experience as a financial advisor in mergers and acquisitions of financial
institutions, particularly transactions in Florida, and its general investment
banking experience in the financial services industry.

         In the ordinary course of its business as a broker/dealer, Ewing may,
from time to time, purchase securities from, and sell securities to, banking
and thrift companies and as a market maker in securities may from time to time
have a long or short position in, and buy or sell, debt or equity securities of
banking and thrift companies for its own account and for the account of its
customers. As of the date of this Proxy Statement/ Prospectus, Ewing had no
such position in the securities of First American or SouthTrust.

INTERESTS OF CERTAIN NAMED PERSONS IN THE MERGER

         Certain members of First American management and of First American's
Board of Directors have interests in the Merger that are in addition to any
interests they may have as shareholders of First American generally. These
interests include, among others, provisions in the Merger Agreement relating to
indemnification of First American's directors and officers and certain
severance and other employee benefits, as described below.

         SouthTrust has agreed in the Merger Agreement that, for a period of
three years after the Effective Time, it will indemnify, defend and hold
harmless each person entitled to indemnification from First American against
all


                                      24
<PAGE>   28

liabilities arising out of actions or omissions occurring at or prior to the
Effective Time of the Merger (including the transactions contemplated by the
Merger Agreement) to the same extent and subject to the same conditions set
forth in First American's Articles of Incorporation and Bylaws as in effect on
the date of the Merger Agreement.

         Following the Effective Time of the Merger and subject to certain
conditions described below, SouthTrust has agreed that the officers and
employees of First American who SouthTrust or any of its affiliates employs
will be eligible to participate in the employee benefit plans of SouthTrust,
including welfare and fringe benefit plans, on the same basis as and subject to
the same conditions as apply to any newly-hired employee of SouthTrust. The
following exceptions apply:

         -        with respect to SouthTrust's group medical insurance plan,
                  SouthTrust will credit each such employee for eligible
                  expenses incurred by such employee and his or her dependents
                  (if applicable) under First American's group medical
                  insurance plan during the current calendar year for purposes
                  of satisfying the deductible provisions under SouthTrust's
                  group medical benefits plan for such current year; and

        -         credit for each such employee's past service with First
                  American prior to the Effective Time of the Merger will be
                  given by SouthTrust to employees for purposes of: (1)
                  determining vacation and sick leave benefits and accruals in
                  accordance with the established policies of SouthTrust; and
                  (2) establishing eligibility for participation in, and
                  vesting under, SouthTrust's employee benefits plans and for
                  purposes of determining the scheduling of vacations and other
                  determinations which are made based on length of service
                  (except that such credit for past service will not be given
                  to any such employee for purposes of establishing eligibility
                  for participation in the 1990 Discounted Stock Plan of
                  SouthTrust).

         The Merger Agreement further provides that the First American Bank
401(k) Plan will either be merged into the SouthTrust Corporation Employee's
Profit Sharing Plan (the "STPS Plan") effective as of January 1 of the year
following the Effective Time of the Merger or will be terminated as of a date
prior to, on or after the Effective Time of the Merger. From and after January
1 following the Effective Time of the Merger, for purposes of determining
eligibility to participate in, and vesting in accrued benefits under, both the
SouthTrust Corporation Revised Retirement Income Plan (the "ST Retirement
Plan") and the STPS Plan, employment by First American will be credited as if
it were employment by SouthTrust, but such service will not be credited for
purposes of determining benefit accrual under the ST Retirement Plan.

         SouthTrust and First American have entered an employment agreement
with Robert J. MacWilliam, the President and Chief Executive Officer of First
American, dated July 1, 1998, which shall become effective immediately prior to
the Effective Time of the Merger and will replace Mr. MacWilliam's existing
employment agreement at that time. The employment agreement provides that upon
the Effective Time of the Merger the employment obligations of First American
under the Employment Agreement shall be assumed by ST-Bank and ST-Bank shall
employ Mr. MacWilliams for a one-year term, annually renewable, and shall pay
him an aggregate annual base salary at a rate of $115,000 per annum. If Mr.
MacWilliam remains employed under the employment agreement through December 31,
1998, he shall receive a cash bonus of $45,000. Under the employment agreement,
Mr. MacWilliam shall be entitled to participate on the same basis as other
similarly situated employees of SouthTrust and its affiliates in all incentive
and benefit programs or arrangements made available by SouthTrust and its
affiliates to such employees, and, after December 31, 1998, he shall be
entitled to participate in such bonus plans and programs as are available to
similarly situated employees of SouthTrust and its affiliates on the same terms
as such similarly situated employees. The employment agreement also provides
for particular benefits including vacation, automobile and insurance. In the
event that the employment agreement is terminated by ST-Bank for Cause (as
defined in the employment agreement), by Mr. MacWilliam other than for Good
Reason (as defined in the employment agreement) or as a result of Mr.
MacWilliam's death or disability, then ST-Bank shall


                                      25
<PAGE>   29

not be further obligated to make payments or provide benefits to Mr. MacWilliam
except for earned but unpaid or unreimbursed amounts.

         SouthTrust and First American have also entered an employment
agreement with Steven C. Shackley, Vice President -- Cashier of First American,
dated July 1, 1998, which shall become effective immediately prior to the
Effective Time of the Merger. The employment agreement provides that upon the
effectiveness of the Merger, the employment obligations of First American under
the employment agreement shall be assumed by ST-Bank and ST- Bank shall employ
Mr. Shackley for a two year period and shall pay him an aggregate annual base
salary at a rate of $50,000 per annum. After the employment agreement is
assumed by ST-Bank, Mr. Shackley shall be entitled to participate in any annual
bonus plan or other similar arrangement maintained by SouthTrust and its
affiliates and in all incentive and benefit programs or arrangements made
available by SouthTrust and its affiliates to similarly situated employees of
SouthTrust and its affiliates on the same basis and terms as other similarly
situated employees. In the event that Mr. Shackley's employment under the
employment agreement shall be terminated by ST-Bank for Cause (as defined
therein), by Mr. Shackley other than for Good Reason (as defined therein), or
as a result of Mr. Shackley's death or disability, then ST-Bank shall have no
further obligation to make payment or provide benefits to Mr. Shackley except
earned but unpaid or unreimbursed amounts.

         ST-Bank has also entered separate Stay Pay Agreements with Steven C.
Shackley, Audrey F. Glover and Michael Float, employees of First American, each
dated July 1, 1998. Each agreement provides that if the Merger is consummated
pursuant to the Merger Agreement, and the Employee continues his or her
employment with First American through the Closing of the Merger, then the
Employee who is a party to such agreement shall be entitled to receive a bonus
equal to one year's base salary. Each Stay Pay Agreement further provides that
the Employee who is a party thereto shall be entitled to an additional lump sum
payment in the event the Employee continues in the employment of ST-Bank
through the earlier of completion of conversion or the expiration of the
twelfth calendar month following the Effective Time of the Merger.

         As of the date of this Proxy Statement/Prospectus, Robert J.
MacWilliam (the President and Chief Executive Officer of First American) held
stock options which entitled him to purchase, in the aggregate, up to 5,500
shares of First American Common Stock. Under the terms of the Merger Agreement,
to the extent that such options are outstanding at the Effective Time, they
shall be assumed by SouthTrust and exercisable thereafter (in accordance with
the terms pursuant to which such options were issued) for a number of shares of
SouthTrust Common Stock equal to 5,500 multiplied by the Conversion Ratio, and
at an exercise price per share equal to the exercise price at which such
options are exercisable at the Effective Time divided by the Conversion Ratio
(rounding to the nearest cent).

EFFECT OF THE MERGER ON FIRST AMERICAN COMMON STOCK

         Pursuant to the Merger Agreement, First American will be merged with
and into ST-Bank pursuant to the Florida Banking Code and the National Bank
Act, and ST-Bank will be the Surviving Corporation. At the Effective Time of
the Merger, and subject to approval of the Merger Agreement by the shareholders
of First American at the Special Meeting, the receipt of required regulatory
approvals, and satisfaction of other conditions, pursuant to the Merger
Agreement, SouthTrust is to issue up to a total of 253,546 shares of SouthTrust
Common Stock for all of the issued and outstanding First American Common Stock
(assuming that no dissenters' rights of appraisal are exercised in the Merger
and assuming the exercise of all First American Options that are exercisable).
As of the date of the Merger Agreement, a total of 128,865 shares of First
American Common Stock were issued and outstanding. An option for the purchase
of up to 5,500 shares of First American Common Stock was also outstanding as of
the date of the Merger Agreement. If the option is not exercised prior to the
Effective Time of the Merger, then SouthTrust will assume the option which
shall then be exercisable for a number of shares equal to 5,500 multiplied by
the Conversion Ratio, at an exercise price equal to the initial exercise price
divided by the Conversion Ratio.

         At the Effective Time of the Merger, each share (excluding (1) shares
held by First American or by SouthTrust or any of its subsidiaries, in each
case other than in a fiduciary capacity or as a result of debts previously
contracted, and (2) shares dissenting from approval of the Merger Agreement) of
First American Common Stock,


                                      26
<PAGE>   30

will become and be converted into the right to receive 1.887 shares of
SouthTrust Common Stock subject to possible adjustment as described in "THE
MERGER -- Possible Conversion Ratio Adjustment."

         The Conversion Ratio, including the number of shares of SouthTrust
Common Stock issuable in the Merger, is also subject to appropriate adjustment
in the event of certain stock splits, stock dividends, reclassifications or
similar distributions effected by SouthTrust.

         No fractional shares of SouthTrust Common Stock will be issued in the
Merger, and, instead, each holder of a share of First American Common Stock
that otherwise would have been entitled to receive a fractional share of
SouthTrust Common Stock will be entitled to receive a cash payment (without
interest) in an amount equal to (1) the fractional interest of a share of
SouthTrust Common Stock to which such holder otherwise would have been
entitled, multiplied by (2) the last sales price of SouthTrust Common Stock as
reported by NASDAQ on the last trading day preceding the Effective Time of the
Merger or the date of exercise in the case of First American Options to be
exercised for shares of SouthTrust Common Stock.

         Because, except as described above, the Conversion Ratio of shares of
SouthTrust Common Stock for First American Common Stock is fixed, it will not
compensate First American shareholders for decreases in the market price of
SouthTrust Common Stock which could occur before the Effective Time of the
Merger. Further, in the event the market price of SouthTrust Common Stock
decreases after _______________, 1998, the date of the Special Meeting, the
value of the SouthTrust Common Stock to be received in the Merger in exchange
for the First American Common Stock would decrease below the value prevailing
at the time the shareholders of First American consider and act upon the
proposal to approve and adopt the Merger Agreement. However, in the event the
market price of SouthTrust Common Stock increases, the value of the SouthTrust
Common Stock to be received in the Merger in exchange for First American Common
Stock would increase. First American's shareholders are advised to obtain
current market quotations for SouthTrust Common Stock. No assurance can be
given as to the market price of SouthTrust Common Stock on the date the Merger
becomes effective or as to the market price of SouthTrust Common Stock
thereafter.

EFFECT OF THE MERGER ON FIRST AMERICAN STOCK OPTIONS

         At the Effective Time of the Merger, all rights with respect to Common
Stock pursuant to stock options ("First American Options") granted by First
American under First American Stock Option Plans, which are outstanding at the
Effective Time of the Merger, whether or not exercisable, shall be converted
into options to purchase SouthTrust Common Stock and will be assumed by
SouthTrust in accordance with the terms of the particular First American Stock
Option Plan under which such First American Options were issued and the stock
option agreement by which such First American Options are evidenced. From and
after the Effective Time of the Merger, (1) each First American Option assumed
by SouthTrust may be exercised solely for shares of SouthTrust Common Stock,
(2) the number of shares of SouthTrust Common Stock subject to such First
American Option shall be equal to the number of shares of First American Common
Stock subject to such First American Option immediately prior to the Effective
Time multiplied by the Conversion Ratio, and (3) the per share exercise price
under each such First American Option shall be adjusted by dividing the per
share exercise price under each such First American Option by the Conversion
Ratio and rounding up to the nearest cent.

         At all times after the Effective Time of the Merger, SouthTrust shall
reserve for issuance such number of SouthTrust Shares as shall be necessary to
permit the exercise of First American Options. At or (at the election of
SouthTrust) within a reasonable time after the Effective Time of the Merger,
SouthTrust has agreed in the Merger Agreement to file a registration statement
on Form S-3 or Form S-8, as the case may be, with respect to the shares of
SouthTrust Common Stock subject to the First American Options and to use its
best efforts to maintain the effectiveness of such registration statement or
registration statements (and maintain the current status of the prospectus or
prospectuses contained therein) for so long as any of the First American
Options remain outstanding.

         The number of SouthTrust Shares subject to First American Options to
be assumed by SouthTrust and the exercise price of the options shall be subject
to any Conversion Rate adjustments.


                                      27
<PAGE>   31

         It is intended that the assumption of First American Options shall be
undertaken in a manner that will not constitute a "modification" as defined in
Section 424 of the Code as to any stock option which is an incentive stock
option as defined in Section 422 of the Code. All restrictions or limitations
on transfer with respect to shares of First American Common Stock awarded under
a First American Stock Option Plan ("Restricted Stock"), to the extent that
such restrictions or limitations shall not have already lapsed, shall remain in
full force and effect with respect to the shares of SouthTrust Common Stock
into which such Restricted Stock is converted unless such restrictions arise
under the Securities Act of 1933 and are eliminated by virtue of the
Registration Statement filed by SouthTrust of which this Proxy
Statement/Prospectus is a part.


                                  DEFINITIONS

Average Closing Price means the average of the daily last sales prices of
SouthTrust Common Stock as reported on NASDAQ for the ten consecutive full
trading days in which SouthTrust shares are traded on NASDAQ ending on the date
specified.

Determination Date is the date on which this Proxy Statement/Prospectus is
mailed to the First American shareholders.

Index Group means the group of bank holding companies identified in the Merger
Agreement (see the box below).

Index Price means the weighted average of the closing prices of the companies
in the Index Group (weighted according to the factors listed in the Merger
Agreement).

Starting Date means July 1, 1998, the date of the Merger Agreement.

POSSIBLE CONVERSION RATIO ADJUSTMENT

         The Board of Directors of First American may have an opportunity to
terminate the Merger Agreement upon the occurrence of certain events relating to
the stock price of the SouthTrust Common Stock. In such event, SouthTrust may
elect, at its sole option, to adjust the Conversion Ratio, as a result of which
the Merger Agreement would not be terminated. The following explanation of the
circumstances in which First American may terminate the Merger Agreement due to
a decline in the value of SouthTrust Common Stock includes terms that we have
defined in the box at right. Please refer to those definitions and to the Merger
Agreement attached as Exhibit A for a complete understanding of this termination
option.

         At any time during the ten-day period beginning two days after the
Determination Date, the Board of Directors of First American may terminate the
Merger Agreement IF BOTH:

         (1) the Average Closing Price of SouthTrust Common Stock as of the
Determination Date shall be less than the Average Closing Price as of June 26,
1998, which was $41.1127, and

         (2) the quotient obtained by dividing the Average Closing Price on the
Determination Date by the Average Closing Price on the Starting Date shall be
less than the quotient obtained by dividing the Index Price on the
Determination Date by the Index Price on the Starting Date.


          If First American elects to terminate the Merger Agreement, it must
give prompt written notice of the election to terminate to SouthTrust. First
American may withdraw the notice of election to terminate at any time within
the ten-day period in which First American may make the election. SouthTrust
then will have five business days in which to elect to increase the Conversion
Ratio so that it equals the quotient obtained by dividing $10,000,000 by the
Average Closing Price on the Determination Date. If SouthTrust elects to
increase the Conversion Ratio within the permitted five-business-day period, it
will give prompt written notice to First American of the election and the
revised Conversion Ratio. If SouthTrust elects to increase the Conversion
Ratio, then no termination shall have occurred and the Merger Agreement will
remain in effect in accordance with its terms (except as the Conversion Ratio
shall have been so modified), and any references in the Merger Agreement to
"Conversion Ratio" will then be deemed to refer to the Conversion Ratio as
adjusted.

         We cannot assure you that the First American Board would exercise its
rights to terminate the Merger Agreement if the criteria specified above are
met. Furthermore, if the First American Board does elect to terminate


                                      28
<PAGE>   32

the Merger Agreement in such circumstances, we cannot assure you that
SouthTrust would elect to increase the Conversion Ratio as provided in the
Merger Agreement.

                                THE INDEX GROUP

The Index Group is composed of the bank holding companies listed below
(although a bank holding company may be removed from the list if certain
unusual situations, as identified in the Merger Agreement, arise).* The bank
holding companies and the weights attributed to them for the Index Price are as
follows:

<TABLE>
<CAPTION>
BANK HOLDING COMPANIES                  WEIGHTING 
- ----------------------                  ---------
<S>                                       <C>   
AmSouth Bancorporation                    4.7871
BB&T Corporation                          7.9746
Compass Bancshares, Inc.                  3.9285
Fifth Third Bancorp                       9.2214
First American Corporation                3.4815
First Security Corporation                6.8925
First Tennessee National Corporation      3.8226
First Virginia Banks, Inc.                3.0816
Hibernia Corporation                      7.7864
Huntington Bancshares, Inc.              11.3856
Mercantile Bancorporation, Inc.           7.7629
Regions Financial Corporation             5.9398
Summit Bancorp                           10.4799
Union Planters Corporation                4.0579
Wachovia Corporation                      9.3977
                                        --------

         Total                          100.0000%
                                        ========  
</TABLE>
  

*The Index Group originally included Star Banc Corporation and SunTrust Banks,
Inc., but these bank holding companies have been removed due to certain
significant transactions involving each of them and the relative weights
attributed to each have been redistributed proportionally.

                  Certain possible effects of the above provisions on the
Conversion Ratio may be illustrated by the following three scenarios:

                  (1)      If the Average Closing Price on the Determination 
         Date is not less than $41.1127, there would be no termination event
         and no adjustment to the Conversion Ratio.

                  (2)      If the Average Closing Price on the Determination 
         Date is less than $41.1127, but the quotient obtained by dividing the
         Average Closing Price on the Determination Date by the Average Closing
         Price on the Starting Date is greater than the quotient obtained by
         dividing the Index Price on the Determination Date by the Index Price
         on the Start Date, there would be no termination event and no increase
         in the Conversion Ratio.

                  (3)      If the Average Closing Price on the Determination 
         Date is less than $41.1127, and the quotient obtained by dividing the
         Average Closing Price on the Determination Date by the Average Closing
         Price on the Starting Date is less than the quotient obtained by
         dividing the Index Price on the Determination Date by the Index Price
         on the Start Date, there would be a termination event and the First
         American Board could, at its sole option, elect to terminate the
         Merger Agreement. However, if the First American Board elects to
         terminate the Merger Agreement on these grounds, SouthTrust could, at
         its sole option, override such termination by electing to increase the
         Conversion Ratio to equal the quotient obtained by dividing
         $10,000,000 by the Average Closing Price on the Determination Date.


         This paragraph uses a recent date, October 19, 1998, as a
hypothetical Determination Date to further illustrate how First American's
Board of Directors might have the option to terminate the Merger Agreement. For
the ten-trading-day period ended October 19, 1998, the Average Closing Price
per share of SouthTrust Common Stock was 31.1751, which is less than 41.1127,
the Average Closing Price as of June 26, 1998. The quotient obtained by
dividing the Average Closing Price on October 19, 1998, by the Average Closing
Price on the Starting Date is .7405. The quotient obtained by dividing the
Index Price on October 19, 1998, by the Index Price on the Starting Date is
 .9072. Because the relevant Average Closing Price quotient of .7405 is less
than the relevant Index Price quotient of .9072 as of October 19,


                                      29
<PAGE>   33

1998, and the Average Closing Price as of that date is less than 41.1127, First
American would have had the option to terminate the Merger Agreement if October
19, 1998 had been the Determination Date. Furthermore, if the relevant
calculations as of the actual Determination Date, the date this Proxy
Statement/Prospectus is mailed, were to produce the same results as the October
19, 1998, calculations, then First American's Board of Directors would have the
right to terminate the Merger Agreement. In such circumstances, however, the
Board of Directors may determine that it would be in the best interest of First
American shareholders not to terminate the Merger Agreement. Furthermore, even
if the First American Board elects to terminate in this scenario, SouthTrust
would have the option to increase the Conversion Ratio, as described above, so
that no termination will have occurred.

         The above scenarios are for illustrative purposes only and are not
intended to, and do not, reflect the value of SouthTrust Common Stock that may
actually be received by holders of First American Common Stock in the Merger,
nor do they reflect all possible termination/increase scenarios.

         First American shareholders should be aware that the Average Closing
Price as of the Determination Date and any subsequent increase in the Conversion
Ratio, if at all, will be based on the average last sales price of SouthTrust
Common Stock during the ten-trading-day period ending on the date that this
Proxy Statement is sent to First American Shareholders. Accordingly, because the
market price of SouthTrust Common Stock will fluctuate between the Determination
Date and the Effective Time of the Merger, as well as on the date certificates
representing shares of SouthTrust Common Stock are delivered in exchange for
shares of First American Common Stock following consummation of the Merger, the
value of the SouthTrust Common Stock actually received by First American
shareholders may be more or less than (1) the Average Closing Price as of the
Determination Date, or (2) the value of the SouthTrust Common Stock at the
Effective Time.


EFFECTIVE TIME OF THE MERGER

         The Merger will become effective on the date and at the time on which
the Merger is deemed effective by the Comptroller. The Merger Agreement
provides that, unless otherwise mutually agreed upon in writing, the parties to
the Merger Agreement will use their reasonable efforts to cause such Effective
Time to occur as soon as practicable following the later to occur of (1) the
effective date (including expiration of any applicable waiting period) of the
last required consent of any regulatory authority having authority over and
approving or exempting the Merger, and (2) the date on which the shareholders
of First American approve the Merger Agreement, although SouthTrust and First
American may agree to another date. The Merger cannot become effective until
First American shareholders have approved the Merger Agreement and all required
regulatory approvals and actions have been obtained and taken.

                  NO ASSURANCE CAN BE PROVIDED THAT THE NECESSARY 
                  SHAREHOLDER AND REGULATORY APPROVALS WILL BE 
                  OBTAINED OR THAT OTHER CONDITIONS PRECEDENT TO 
                  THE MERGER CAN OR WILL BE SATISFIED. FIRST AMERICAN
                  AND SOUTHTRUST ANTICIPATE THAT ALL CONDITIONS TO
                  CONSUMMATION OF THE MERGER WILL BE SATISFIED SO 
                  THAT THE MERGER CAN BE CONSUMMATED ON OR BEFORE
                  _______________, 1998. HOWEVER, DELAYS IN THE
                  CONSUMMATION OF THE MERGER COULD OCCUR.

         Either SouthTrust, ST-Sub, ST-Bank or First American generally may
terminate the Agreement if the Merger is not consummated on or prior to
February 28, 1999, but only if the party electing to terminate is not then in
breach of any representations, warranties, covenants or other agreements
contained in the Merger Agreement. See "THE MERGER -- Regulatory Approvals and
Certain Other Conditions to Consummation of the Merger; Waiver and Amendment"
and "THE MERGER -- Termination."

EXCHANGE OF STOCK CERTIFICATES

         Promptly after the Effective Time of the Merger, SouthTrust and First
American will cause the exchange agent selected by SouthTrust (the "Exchange
Agent") to mail appropriate transmittal materials to each former


                                      30
<PAGE>   34

holder of record of shares of First American Common Stock. Shareholders should
use these transmittal materials to exchange their certificates which formerly
represented shares of First American Common Stock for exchange and conversion
in accordance with the procedures provided for in this Proxy
Statement/Prospectus and in the Merger Agreement. Shareholders should carefully
follow the instructions in the letter of transmittal to ensure proper delivery
to the Exchange Agent. FIRST AMERICAN SHAREHOLDERS SHOULD NOT SURRENDER THEIR
CERTIFICATES FOR EXCHANGE UNTIL THEY RECEIVE SUCH LETTER OF TRANSMITTAL AND
INSTRUCTIONS.

         After the Effective Time of the Merger, each holder of shares of First
American Common Stock shall surrender the certificates representing those
shares to the Exchange Agent and shall promptly receive in exchange:

         -        SouthTrust Common Stock
         -        all undelivered dividends or distributions on the SouthTrust
                  Common Stock (but without interest on such amounts)
         -        cash in lieu of fractional shares of SouthTrust Common Stock 
                  to which the shareholder may otherwise be entitled.

A First American shareholder will not receive any SouthTrust Common Stock or
other related payments until the shareholder has surrendered the shares of
First American Common Stock for exchange. Neither SouthTrust nor the Exchange
Agent shall be liable to a holder of First American Common Stock for any
amounts paid or property delivered in good faith to a public official pursuant
to any applicable abandoned property law.

         Whenever SouthTrust may declare a dividend or other distribution on
SouthTrust Common Stock, with a record date at or after the Effective Time of
the Merger, the declaration will include dividends or other distributions on
all shares issuable pursuant to the Merger Agreement. However, after the
Effective Time of the Merger, a First American shareholder will not receive any
dividend or other distribution payable after the Effective Time of the Merger
with respect to SouthTrust Common Stock unless and until the holder duly
surrenders his or her certificates representing shares of First American Common
Stock.

         After the Effective Time of the Merger, there will be no transfers of
shares of First American Common Stock on First American's stock transfer books.
If certificates formerly representing shares of First American Common Stock are
presented for transfer after the Effective Time of the Merger, they will be
canceled and exchanged for shares of SouthTrust Common Stock and a check for
the amount due in lieu of fractional shares, if any, pursuant to the Merger
Agreement.

RESALE OF SOUTHTRUST COMMON STOCK RECEIVED IN THE MERGER

         SouthTrust has registered the shares of SouthTrust Common Stock to be
issued pursuant to the Merger Agreement, as required under the Securities Act.
Therefore, shareholders of First American can sell their shares of SouthTrust
Common Stock without restriction unless the shareholder was deemed to be an
"affiliate" (as that term is defined in the rules under the Securities Act) of
First American or becomes an affiliate of SouthTrust. Affiliates of First
American may resell the shares of SouthTrust Common Stock only

         -         pursuant to an effective registration statement.

         -         pursuant to Rule 145 under the Securities Act, or

         -         in transactions otherwise exempt from registration under the
                   Securities Act.

         SouthTrust will not be obligated and does not intend to register its
shares under the Securities Act for resale by shareholders who are affiliates.
Under the volume limitations of Rule 145, and based upon outstanding shares of
SouthTrust Common Stock as of June 30, 1998 (exclusive of shares of SouthTrust
Common Stock to be issued in the Merger), each affiliate of First American will
be free to resell, during any given three-month period, up to approximately
1,646,756 shares of SouthTrust Common Stock, provided that such affiliate
otherwise complies with the provisions of Rule 145.


                                      31
<PAGE>   35

         This Proxy Statement/Prospectus does not cover any resales of
SouthTrust Common Stock received by persons who may be deemed to be affiliates
of First American or SouthTrust.

         First American has identified certain persons as affiliates of First
American. Each of those affiliates has executed a written agreement in the form
provided for in the Merger Agreement providing that such affiliate will not
sell, transfer or otherwise dispose of such shares of SouthTrust Common Stock
to be received by such affiliate upon consummation of the Merger, except

         -        in compliance with the Securities Act or the rules and
                  regulations thereunder, and

         -        after financial results covering at least 30 days of combined
                  operations of First American and SouthTrust have been
                  published within the meaning of Section 201.01 of the
                  Commission's Codification of Financial Reporting Policies.

ACCOUNTING TREATMENT

         SouthTrust will account for the Merger as a pooling of interests.
Under the pooling-of-interests method of accounting, the recorded amounts of
the assets and liabilities of First American and SouthTrust will be carried
forward at their previously recorded amounts. The Merger Agreement provides, as
a condition of SouthTrust's obligations to consummate the Merger, that the
transactions contemplated by the Merger Agreement qualify for pooling of
interest accounting treatment, as determined by SouthTrust. To assure the
availability of pooling-of-interests accounting treatment, affiliates of First
American will be subject to certain restrictions on transfers of the SouthTrust
Common Stock they receive. For more information on these restrictions, see "THE
MERGER -- Resale of SouthTrust Common Stock Received in the Merger."

REGULATORY APPROVALS AND CERTAIN OTHER CONDITIONS TO THE MERGER

         SouthTrust and First American will not be obligated to consummate the
Merger until certain conditions are satisfied, including, among others, (1) the
receipt of all required regulatory approvals with respect to the Merger, (2)
the approval of the Merger Agreement by the requisite vote of First American
shareholders, and (3) certain other conditions as described in more detail
below.

         SouthTrust and First American have submitted applications for the
approvals described below to the appropriate regulatory agencies. WE CANNOT
ASSURE THAT SUCH REGULATORY APPROVALS WILL BE OBTAINED OR AS TO THE TIMING OF
ANY SUCH APPROVALS. Any such approvals may impose conditions or be restricted
in a manner (including requirements relating to the raising of additional
capital or the disposition of assets) which in the reasonable judgment of the
Board of Directors of either SouthTrust or First American would so materially
adversely impact the economic or business benefits of the transactions
contemplated by the Agreement that, SouthTrust or First American would not, in
its reasonable judgment, have entered into the Merger Agreement had such
condition or requirement been known.

         Any approval received from bank regulatory agencies reflects only
their view that the Merger does not contravene applicable competitive standards
imposed by law, and that the Merger is consistent with regulatory policies
relating to safety and soundness. THE APPROVAL OF THE BANK REGULATORY AGENCIES
IS NOT AN ENDORSEMENT OR RECOMMENDATION OF THE MERGER.

         First American and SouthTrust are not aware of any material
governmental approvals or actions that are required for consummation of the
Merger, except those described below. If any other approval or action is
required, SouthTrust and First American plan to seek such approval or action.

         The Merger cannot be consummated without certain regulatory approvals,
including the approval of the Comptroller under the Bank Merger Act, which
prohibits the merger or consolidation of any insured institution with any other
depository institution without the approval of the insured institution's
primary federal supervisory


                                      32
<PAGE>   36

regulatory agency. On September 22, 1998, ST-Bank submitted to the Comptroller
an application seeking approval of the Merger.

         The Bank Merger Act requires that the Comptroller take into
consideration, among other factors, the financial and managerial resources and
future prospects of the institutions and the convenience and needs of the
communities to be served. In essence, the Comptroller will deny approval of the
Merger

         -        if such transaction would result in a monopoly or be in
                  furtherance of any combination or conspiracy to monopolize or
                  to attempt to monopolize the business of banking in any part
                  of the United States, or

         -        if the effect of such transaction in any section of the
                  country may be substantially to lessen competition or to tend
                  to create a monopoly, or if it would in any other manner be a
                  restraint of trade,

unless the relevant regulatory agency finds that the anti-competitive effects
of such merger are clearly outweighed by the public interest and by the
probable effect of the transaction in meeting the convenience and needs of the
communities to be served. Under the Bank Merger Act, the Comptroller also
considers whether the proposed transaction can reasonably be expected to
produce benefits to the public, such as greater convenience, increased
competition, or gains in efficiency, that outweigh possible adverse effects,
such as undue concentration of resources, decreased or unfair competition,
conflicts of interests, or unsound banking practices. The Comptroller has the
authority to deny an application if it concludes that the combined organization
would have an inadequate capital position or if the acquiring organization does
not meet the requirements of the Community Reinvestment Act of 1977. In
addition, the Merger may not be consummated until the 30th day following the
date of the approval of the Comptroller, during which period the United States
Department of Justice may comment adversely on the transaction or challenge the
Merger on antitrust grounds. However, the Merger may be consummated on or after
the 15th day following the date of the approval of the Comptroller if the
Comptroller does not receive any adverse comments from the United States
Attorney General and the United States Attorney General consents to the shorter
period. The commencement of an antitrust action would suspend the effectiveness
of such an approval unless a court specifically orders otherwise. There can be
no assurance that the United States Department of Justice or a State Attorney
General will not challenge the Merger or, if such a challenge is made, as to
the result of such a challenge.

         The consummation of the Merger is subject to (1) receipt of all
necessary regulatory approvals and the expiration of all required notice and
waiting periods following the granting of such approvals, (2) the approval of
the Merger Agreement by the requisite vote of the shareholders of First
American and (3) the satisfaction of certain other conditions on or before the
Effective Time of the Merger. Such additional conditions include, among others,
the following:

         -        Neither the Commission nor any other Regulatory Authority
                  will have issued any stop orders suspending the effectiveness
                  of the Registration Statement or initiated or threatened any
                  proceeding to suspend the effectiveness of the Registration
                  Statement;

         -        The representations and warranties of SouthTrust and First
                  American, respectively, made in the Merger Agreement and
                  assessed as of the time of the Merger Agreement and as of all
                  times up to and including the Effective Time of the Merger
                  will be accurate to the extent provided for in the Merger
                  Agreement;

         -        SouthTrust and First American, respectively, will have
                  performed, and complied with all of their respective
                  agreements and covenants pursuant to the Merger Agreement;

         -        The receipt of the opinion of Bradley Arant Rose & White LLP
                  as to certain tax matters (see "CERTAIN FEDERAL INCOME TAX
                  CONSEQUENCES");


                                      33
<PAGE>   37

         -        The receipt of the opinion of Bradley Arant Rose & White LLP 
                  as to certain matters and the receipt of the opinion of
                  Smith, Mackinnon, Greeley, Bowdoin & Edwards, P.A. as to
                  certain matters;

         -        No court or governmental or regulatory authority of competent
                  jurisdiction will have enacted, issued, promulgated, enforced
                  or entered any law, order or similar restriction or taken any
                  other action which prohibits or makes illegal the
                  consummation of the transactions contemplated by the Merger
                  Agreement;

         -        The shares of SouthTrust Common Stock issuable pursuant to the
                  Merger will have been approved for listing on NASDAQ;

         -        First American shall have obtained the written agreement of
                  the landlord of the building occupied by First American to
                  change the name of the building to "SouthTrust Bank Building"
                  or such other name that does not reference a banking
                  institution other than SouthTrust and its affiliates.

         -        SouthTrust shall not have determined that the transactions 
                  contemplated by the Merger Agreement fail to qualify for
                  pooling of interests accounting treatment; and

         -        In the case of SouthTrust's obligations, the holders of not
                  more than 5% of First American Common Stock, will have taken
                  appropriate steps to dissent from the Merger.

WAIVER AND AMENDMENT

         At any time before the Effective Time of the Merger, any party to the
Merger Agreement may: (1) waive any default in the performance of any term of
the Merger Agreement by the other party; (2) waive or extend the time for
compliance or fulfillment by the other party of any and all of such other
parties' obligations; and (3) waive any or all conditions to its obligations
under the Merger Agreement, except any condition which, if not satisfied, would
result in the violation of any law or any applicable governmental regulation.

         The parties to the Merger Agreement may amend the Merger Agreement in
writing if all of the parties to the Merger Agreement execute the written
amendment, except that the parties may not amend the Merger Agreement to reduce
or modify the consideration to be received by the holders of First American
Common Stock.

TERMINATION

         The Merger Agreement may be terminated and the Merger abandoned, at
any time prior to the Effective Time of the Merger in any of the following
ways:


         1.       by the mutual consent in writing of SouthTrust, ST-Sub, 
                  ST-Bank and First American;

         2.       by SouthTrust, ST-Sub, ST-Bank or First American if the
                  Merger shall not have occurred on or prior to February 28,
                  1999, provided that the failure to consummate the Merger on
                  or before such date is not accompanied by any breach of any
                  of the representations, warranties, covenants or other
                  agreements contained in the Merger Agreement by the party
                  electing to terminate;

         3.       by SouthTrust or First American (provided that the
                  terminating party is not then in breach of any
                  representation, warranty, covenant or other agreement
                  contained herein) in the event that any of the conditions to
                  the obligations of the nonterminating party to consummate the
                  Merger cannot be satisfied or fulfilled;

         4.       by SouthTrust if:

                  (a) SouthTrust shall have determined that any fact, event or
                  condition exists that, in the judgment of SouthTrust:


                                      34
<PAGE>   38

                  -        is materially at variance with any warranty or
                           representation of First American set forth in the
                           Merger Agreement or is a material breach of any
                           covenant or agreement of First American contained in
                           the Merger Agreement,

                  -        has a Material Adverse Effect or can be reasonably
                           foreseen to have a Material Adverse Effect upon the
                           Condition (as defined in the Merger Agreement) of
                           First American on a consolidated basis or upon the
                           consummation of the transactions contemplated by the
                           Agreement,

                  -        would be materially adverse to the interests of 
                           SouthTrust and ST-Bank on a consolidated basis,

                  -        relates to or affects First American and would
                           significantly and materially adversely affect the
                           economic benefits reasonably and good faith expected
                           to be obtained by SouthTrust from consummating the
                           transaction contemplated by the Merger Agreement,
                           including, without limitation, a significant and
                           material adverse effect with respect to First
                           American's consolidated financial condition or
                           results of operation, credit quality or allowance
                           for possible loan losses or any item related
                           thereto, or

                  -        renders the Merger or the other transactions
                           contemplated by this Agreement impractical because
                           of any state of war, national emergency, banking
                           moratorium or general suspension of trading on
                           NASDAQ, the New York Stock Exchange, Inc. or any
                           other national securities exchange; or

                  (b) there shall be any litigation or threat of litigation

                  -        challenging the validity or legality of the Merger 
                           Agreement or the consummation of the transactions
                           contemplated by this Agreement,

                  -        seeking damages in connection with the consummation
                           of the transactions contemplated by the Merger
                           Agreement or

                  -        seeking to restrain or invalidate the consummation of
                           the transactions contemplated by the Merger
                           Agreement.

         5.       by First American if:

                  (a) First American shall have determined that any fact, event
                  or condition exists that, in the judgment of First American,

                  -        is materially at variance with any warranty or
                           representation of SouthTrust, ST-Sub or ST-Bank
                           contained in the Merger Agreement or is a material
                           breach of any covenant or agreement of SouthTrust,
                           ST-Sub or ST-Bank contained in the Merger Agreement,

                  -        has a Material Adverse Effect or can be reasonably 
                           seen to have a Material Adverse Effect upon the
                           consummation of the transactions contemplated by the
                           Merger Agreement;

                  (b) there shall be any litigation or threat of litigation

                  -        challenging the validity or legality of the Merger 
                           Agreement or the consummation of the transactions
                           contemplated by the Merger Agreement,


                                      35
<PAGE>   39

                  -        seeking damages in connection with the consummation 
                           of the transactions contemplated by the Merger
                           Agreement or

                  -        seeking to restrain or invalidate the consummation of
                           transactions contemplated by this Agreement, or

                  (c) First American shall have determined that any fact, event
                  or condition exists that, in the judgment of First American,
                  would render the Merger and the other transactions
                  contemplated by this Agreement impractical because of any
                  state of war, national emergency, banking moratorium or
                  general suspension of trading on NASDAQ, the New York Stock
                  Exchange, Inc. or other national securities exchange.

         6.       by majority vote of the entire Board of Directors of First
                  American if the average daily last sales price of SouthTrust
                  Common Stock on the date this Proxy Statement/Prospectus is
                  mailed is lower than the average daily last sales price of
                  SouthTrust Common Stock on June 26, 1998, and the percentage
                  drop in the ten-day average closing price of SouthTrust
                  Common Stock is greater than the percentage drop in the
                  one-day weighted average stock price of an Index Group of
                  bank holding companies during the period from July 1, 1998,
                  to the date this Proxy Statement/Prospectus is mailed, see
                  "THE MERGER - POSSIBLE CONVERSION RATIO ADJUSTMENT."

         7.       by First American if (1) First American receives a bona fide
                  offer or proposal from a third party (as defined in the
                  Merger Agreement), (2) the Board of Directors of First
                  American believes in good faith, after consultation with its
                  financial advisor, that terminating the Merger Agreement and
                  entering into certain appropriate agreements with such third
                  party would result in a superior financial transaction for
                  First American shareholders, and (3) outside counsel to First
                  American provides a written opinion to the Board of Directors
                  of First American to the effect that the failure to take such
                  action would subject First American Directors to liability
                  for breach of their fiduciary duties.

         If the Merger Agreement is terminated, then the only liability or
further obligation that will continue under the Merger Agreement (other than a
possible termination fee), will be liability by a breaching party for an
uncured willful breach of any representations, warranties, covenants or other
agreements giving rise to such termination. Furthermore, First American shall
pay SouthTrust a cash amount of $500,000 as an agreed-upon termination fee as
the sole and exclusive remedy of SouthTrust against First American if (1) First
American receives an offer or proposal to enter an acquisition transaction with
a third party, (2) thereafter the Merger Agreement and the Merger are not
consummated and (3) an Acquisition Transaction is consummated or a definitive
agreement is entered into by First American relating to an Acquisition
Transaction within one year of the later of the termination of the Merger
Agreement or the date the Acquisition Transaction is offered, presented or
proposed to the Board of First American.

CERTAIN EXPENSES

         The parties to the Merger Agreement will bear their own expenses
incurred in connection with consummating the transactions contemplated the
Merger Agreement. SouthTrust will pay all the filing fees payable in connection
with the Registration Statement and the Proxy Statement/Prospectus and printing
costs incurred in connection with the printing of the Registration Statement
and the Proxy Statement/Prospectus.

RIGHTS OF DISSENT AND APPRAISAL

         A shareholder of First American may dissent from the Merger and
receive in cash the appraised value, as of the Effective Time of the Merger, of
the shares of First American Common Stock held by such shareholder pursuant to
Section 215a of the United States Code (the "Dissent Provisions"). Section 215a
of the United States Code is the controlling provision relating to the dissent
rights of First American shareholders in light of Section


                                      36
<PAGE>   40

658.41(2) of the Florida Banking Code which provides that federal, rather than
Florida law, will be controlling in the merger of a Florida bank into a
national bank. The appraised value of the First American Common Stock may
differ from the consideration that a shareholder of First American is entitled
to receive in the Merger. The following is only a summary of the Dissent
Provisions. We urge each First American shareholder to read carefully the full
text of the Dissent Provisions set forth as Exhibit C to this Proxy
Statement/Prospectus.

         Under the Dissent Provisions, a shareholder of First American may
dissent from the Merger by (1) voting against the Merger or by giving notice in
writing at or prior to the Special Meeting to First American that the
shareholder dissents from the Merger Agreement, AND (2) making a written
request to ST-Bank, within thirty days of the Effective Time of the Merger and
accompanied by the surrender of the shareholder's stock certificates, to
receive the fair value of the shares of First American Common Stock.

         The value of the shares of any dissenting shareholder shall be
determined as of the Effective Time of the Merger by an appraisal made by a
committee of three persons. The committee will be composed of one person
selected by the holders of a majority of the shares of First American Common
Stock for which rights of dissent are being asserted, one selected by the Board
of Directors of ST-Bank and the third selected by the other two. The valuation
agreed upon by any two of the three appraisers shall govern. However, if the
value so fixed is not satisfactory to any dissenting shareholder who has
requested payment, that shareholder may, within five days after being notified
of the appraised value of his shares, appeal to the Comptroller, who shall
cause a reappraisal to be made which shall be final and binding as to the value
of the shares of the dissenting shareholder who has appealed to the
Comptroller.

         If, within ninety days from the Effective Time of the Merger, for any
reason one or more of the three appraisers is not selected as provided by the
Dissent Provisions, or the appraisers shall fail to determine the value of the
shares, the Comptroller shall upon written request of any interested party
cause an appraisal to be made which shall be final and binding on all parties.
In any event, ST-Bank shall promptly pay the value of shares ascertained under
the Dissent Provisions to the dissenting shareholders. In addition, the
SouthTrust Common stock that would have been delivered to the dissenting
shareholders but for their dissent may, if required by law, be sold at an
advertised public auction at which SouthTrust may bid. If the shares are
auctioned and are sold at a price greater than that paid to the dissenting
shareholders, such excess amount would be remitted to the dissenting
shareholders. The Comptroller has taken the position that a shareholder may
dissent as to less than all of the shares of stock owned by such shareholder.
ST-Bank shall pay the expenses of the Comptroller in making the reappraisal or
the appraisal, as the case may be.

CONDUCT OF BUSINESS BY FIRST AMERICAN PENDING THE MERGER

         The Merger Agreement provides that, until the Effective Time of the
Merger, and except with the prior approval of SouthTrust, or as otherwise
required by law or regulation, First American will operate its business only in
the usual, regular and ordinary course, preserve intact its business
organization, employees, goodwill with customers and advantageous business
relationships and retain the services of its officers and key employees. First
American also will take no action which would adversely affect its ability to
obtain required regulatory approvals or to perform any of its material
obligations under the Merger Agreement. The Merger Agreement further provides
that, until the Effective Time of the Merger, First American will NOT do or
agree or commit to do any of the following without the prior written consent of
SouthTrust:

         (1)      change, delete or add any provision of or to the Articles of 
                  Incorporation or Bylaws of First American;

         (2)      except for the issuance of the First American Shares pursuant
                  to the terms of the First American Options, (A) change the
                  number of shares of the authorized, issued or outstanding
                  capital stock of First American, (B) issue or grant any
                  option, warrant, call, commitment, subscription, right or
                  agreement to purchase relating to the authorized or issued
                  capital stock of First American, or (C)


                                      37
<PAGE>   41

                  declare, set aside or pay any dividend or other distribution
                  with respect to the outstanding capital stock of First
                  American;

         (3)      incur any material liabilities or material obligations (other
                  than deposit liabilities and short-term borrowings in the
                  ordinary course of business), whether directly or by way of
                  guaranty, including any obligation for borrowed money, or
                  whether evidenced by any note, bond, debenture, or similar
                  instrument, except in the ordinary course of business
                  consistent with past practice;

         (4)      make any capital expenditures individually in excess of
                  $25,000, or in the aggregate in excess of $50,000 other than
                  pursuant to binding commitments existing on December 31, 1997
                  and disclosed in a Disclosure Schedule delivered pursuant to
                  the Merger Agreement and other than expenditures necessary to
                  maintain existing assets in good repair;

         (5)      sell, transfer, convey or otherwise dispose of any real
                  property (including "other real estate owned") or interest
                  therein or any tangible or intangible personal property
                  having a book value in excess of or in exchange for
                  consideration in excess of $25,000 for each such parcel or
                  interest;

         (6)      pay any bonuses to any executive officer or director except
                  pursuant to the terms of an enforceable written agreement as
                  reflected in a Disclosure Schedule delivered pursuant to the
                  Merger Agreement; enter into any new, or amend in any respect
                  any existing, employment, consulting, non-competition or
                  independent contractor agreement with any person; alter the
                  terms of any existing incentive bonus or commission plan;
                  adopt any new or amend in any material respect any existing
                  employee benefit plan, except as may be required by law;
                  grant any general increase in compensation to its employees
                  as a class or to its officers except for non-executive
                  officers in the ordinary course of business and consistent
                  with past practices and policies or except in accordance with
                  the terms of an enforceable written agreement; grant any
                  material increases in fees or other increases in compensation
                  or in other benefits to any of its directors; or effect any
                  change in any material respect in retirement benefits to any
                  class of employees or officers, except as required by law;

         (7)      enter into or extend any agreement, lease or license relating
                  to real property, tangible or intangible personal property or
                  any service or other function (including, without
                  limitation), data processing or bankcard functions relating
                  to First American that involves an aggregate of $25,000;

         (8)      increase or decrease the rate of interest paid on time
                  deposits or on certificates of deposit, except in a manner
                  and pursuant to policies consistent with First American's
                  past practices;

         (9)      purchase or otherwise acquire any investment securities for
                  its own account having an average remaining life to maturity
                  greater than five years, or any asset-backed security, other
                  than those issued or guaranteed by the Government National
                  Mortgage Association, the Federal National Mortgage
                  Association or Home Loan Mortgage Corporation, or any
                  Derivative Contract; or

         (10)     acquire twenty percent (20%) or more of the assets or equity 
                  securities of any person or acquire direct or indirect
                  control of any person, other than in connection with (A) any
                  internal reorganization or consolidation involving existing
                  subsidiaries of First American which has been approved in
                  advance in


                                      38
<PAGE>   42

                  writing by SouthTrust, (B) foreclosures in the ordinary
                  course of business, (C) acquisitions of control by First
                  American in a fiduciary capacity or (D) the creation of new
                  subsidiaries organized to conduct and continue activities
                  otherwise permitted by this Agreement.

         First American has also agreed that it will not, acting through any
director or officer or other agent, nor shall it authorize or knowingly permit
any officer, director or employee of, or any investment banker, attorney,
accountant or other representative retained by First American to, solicit or
encourage, including by way of furnishing information, any inquiries or the
making of any proposal which may reasonably be expected to lead to any takeover
proposal with respect to First American. First American has agreed to promptly
advise SouthTrust orally and in writing of any such inquiries or proposals
received by First American. As used in this paragraph, "takeover proposal"
means any proposal for a merger or other business combination involving First
American or for the acquisition of a significant equity interest in First
American or for the acquisition of a significant portion of the assets or
liabilities of First American.

         Notwithstanding the foregoing, First American may furnish information
concerning its business, properties or assets to a corporation, partnership,
person or other entity or group (a "Third Party") which has initiated the
possibility of effecting a transaction with First American and has expressed an
intention to make a bona fide offer or proposal to First American to acquire
First American. Following receipt of a bona fide offer or proposal, from such
Third Party, First American may negotiate and take any of the actions otherwise
prohibited by the foregoing paragraph, including without limitation, entering
into appropriate agreements with such Third Party, if the Board of Directors of
First American believes in good faith, after consultation with its financial
advisor, that such actions would result in a superior financial transaction for
First American shareholders, and if outside counsel to First American provides
a written opinion to the Board of Directors of First American to the effect
that the failure to furnish such information, or negotiate or enter into
appropriate agreements with such Third Party, would subject First American
Directors to liability for breach of their fiduciary duties.

BUSINESS AND MANAGEMENT OF FIRST AMERICAN FOLLOWING THE MERGER; PLANS FOR 
BUSINESS OF FIRST AMERICAN

         Upon consummation of the Merger, First American will be merged into
ST-Bank, with ST-Bank being the surviving corporation in the Merger (the
surviving corporation being sometimes referred to herein as the "Surviving
Corporation"). As of the Effective Time of the Merger, First American and
SouthTrust anticipate that the Board of Directors of the Surviving Corporation
will consist of those persons who are serving as directors of ST-Bank as of the
Effective Time of the Merger, and such other persons as may be designated in
writing by SouthTrust at or prior to the Effective Time of the Merger. First
American and SouthTrust further anticipate that the officers of the Surviving
Corporation will be those persons serving as officers of ST-Bank as of the
Effective Time of the Merger, and such other persons as may be designated in
writing by SouthTrust at or prior to the Effective Time of the Merger.

         After the Effective Time of the Merger, SouthTrust will integrate the
operations of First American into the operations of ST-Bank, with efforts
directed toward preserving the existing customer and banking relationships of
First American as part of ST-Bank.

         Following the Effective Time of the Merger, SouthTrust has agreed:

         -        to cover the officers and employees of First American who are
                  employed by ST-Bank under the employee benefit plans of
                  SouthTrust;

         -        to grant such employees coverage and benefits under such
                  employee benefit plans comparable to those granted SouthTrust
                  employees of comparable position and seniority; and,

         -        subject to the provisions discussed in the following
                  paragraph, to credit service with First American prior to the
                  Effective Time of the Merger for purposes of determining
                  eligibility of such employees to participate in such employee
                  benefit plans.


                                      39
<PAGE>   43
         The Merger Agreement further provides that the First American 401(k)
Plan will either be merged into the SouthTrust Corporation Employee's Profit
Sharing Plan ("STPS Plan") or will be terminated as of a date prior to the
Effective Time of the Merger. From and after January 1 following the Effective
Time of the Merger, for purposes of determining eligibility to participate in,
and vesting in accrued benefits under both the ST Retirement Plan and the STPS
Plan, employment by First American will be credited as if it were employment by
SouthTrust, but such service will not be credited for purposes of determining
benefit accrual under the ST Retirement Plan.


                    CERTAIN FEDERAL INCOME TAX CONSEQUENCES

GENERAL

         The following discussion is a summary of the material federal income
tax consequences of the Merger to holders of First American Common Stock. The
discussion is included for general information purposes only and applies only
to a holder of First American Common Stock who holds such stock as a capital
asset. This discussion may not apply to special situations, such as holders of
First American Common Stock, if any, who received their First American Common
Stock upon the exercise of employee stock options or otherwise as compensation
and holders that are insurance companies, securities dealers, financial
institutions or foreign persons.

EACH HOLDER OF FIRST AMERICAN COMMON STOCK IS URGED TO CONSULT HIS OR HER OWN
TAX ADVISOR AS TO THE FEDERAL INCOME TAX CONSEQUENCES IN HIS OR HER OWN
PARTICULAR FACTS AND CIRCUMSTANCES, AND ALSO AS TO ANY STATE, LOCAL, FOREIGN
OR OTHER TAX CONSEQUENCES ARISING OUT OF THE MERGER.

         Neither SouthTrust, ST-Sub, ST-Bank nor First American has requested
or will receive an advance ruling from the Internal Revenue Service ("IRS") as
to any of the federal income tax consequences of the Merger to holders of First
American Common Stock or to SouthTrust, ST-Sub, ST-Bank or First American. The
consummation of the Merger is conditioned upon the receipt by First American of
an opinion of Bradley Arant Rose & White LLP as to certain of the federal
income tax consequences of the Merger to the holders of First American Common
Stock (pursuant to Section 9.8 of the Merger Agreement as modified by that
certain Side Letter dated October 20, 1998, and signed by all of the parties to
the Merger Agreement). The opinion of Bradley Arant Rose & White LLP is based
entirely upon the Code, current regulations under the Code, current
administrative rulings and practice, and judicial authority, all of which are
subject to change, possibly with retroactive effect. Management of SouthTrust
has represented to Bradley Arant Rose & White LLP that it has no plan or
intention to cause SouthTrust to redeem or otherwise reacquire the shares of
SouthTrust Common Stock issued in the Merger.

         Unlike a ruling from the IRS, an opinion is not binding on the IRS and
SouthTrust and First American cannot (and do not here) assure the First
American shareholders that the IRS will not take a position contrary to one or
more positions reflected in this Proxy Statement/Prospectus or that the
positions stated in the opinion will be upheld by the courts if challenged by
the IRS.

         In the opinion of Bradley Arant Rose & White LLP, the following
federal income tax consequences to the holders of First American Common Stock
will result from the Merger:

                  (1)      For federal income tax purposes the Merger will be
         viewed as an acquisition by ST-Sub of substantially all of the assets
         of First American solely in exchange for SouthTrust voting Common
         Stock and the assumption of all the liabilities of First American by
         ST-Sub, followed by the transfer of the assets of First American to
         ST-Bank and the assumption by ST- Bank of the liabilities of First
         American.

                  (2)      The acquisition by ST-Sub of substantially all of the
         assets of First American in exchange solely for shares of SouthTrust
         voting common stock and the assumption by ST-Sub of



                                      40
<PAGE>   44



         First American's liabilities will constitute a reorganization within
         the meaning of Section 368(a)(1)(C) of the Code. For purposes of the
         opinion, "substantially all" means at least 90% of the fair market
         value of the net assets and at least 70% of the fair market value of
         the gross assets of First American. Pursuant to Section 368(a)(2)(C)
         of the Code, the acquisition by ST-Sub of substantially all of the
         assets of First American will not be disqualified under Section
         368(a)(1)(C) of the Code solely by reason of the fact that the assets
         of First American that were acquired by ST- Sub are transferred to
         ST-Bank. SouthTrust, ST-Sub and First American each will be a "party
         to the reorganization" within the meaning of Section 368(b) of the
         Code. The requirement under Section 368(a)(2)(G) of the Code that
         First American distribute the stock, securities, and other properties
         it receives, as well as its other properties, in pursuance of the plan
         of reorganization will be satisfied by reason of the issuance by
         ST-Sub of the merger consideration directly to the holders of First
         American Common Stock, and by reason of the cessation of the separate
         corporate existence of First American pursuant to the Merger Agreement
         and the applicable provisions of the Florida Code.

                  (3)      No gain or loss will be recognized by the
         shareholders of First American upon the receipt of SouthTrust Common
         Stock (including the Rights associated therewith) solely in exchange
         for their shares of First American Common Stock. In addition, no gain
         or loss will be recognized by First American shareholders upon the
         receipt of the Rights attached to the SouthTrust Common Stock.

                  (4)      The basis of the SouthTrust Common Stock to be
         received by the First American shareholders will be the same as the
         basis of First American Common Stock surrendered in exchange therefor,
         except for the basis allocated to any fractional shares.

                  (5)      The holding period of the shares of SouthTrust
         Common Stock to be received by the shareholders of First American will
         include the period during which First American Common Stock
         surrendered in exchange therefor was held, provided that the shares of
         First American Common Stock were held as capital assets within the
         meaning of Section 1221 of the Code as of the Effective Time of the
         Merger.

                  (6)      First American shareholders who exercise dissenters'
         rights, and as a result of which receive only cash, will be treated as
         having received such cash as a distribution in redemption of their
         First American Common Stock, subject to the provisions and limitations
         of Section 302 of the Code. Those First American shareholders who hold
         no SouthTrust Common Stock, directly or indirectly through the
         application of Section 318(a) of the Code, following the Merger shall
         be treated as having a complete termination of interest within the
         meaning of Section 302(b)(3) of the Code, and the cash received will
         be treated as a distribution in full payment in exchange for First
         American Common Stock as provided in Section 302(a) of the Code. As
         provided in Section 1001 of the Code, gain will be realized and
         recognized by such shareholders measured by the difference between the
         redemption price and the adjusted basis of the First American shares
         surrendered as determined under Section 1011 of the Code. Provided
         Section 341 of the Code (relating to collapsible corporations) is
         inapplicable and the First American Common Stock is a capital asset in
         the hands of such shareholders, the gain, if any, will constitute
         capital gain. Such gain will constitute a long-term capital gain if
         the surrendered First American shares were held by the shareholder for
         a period greater than one year prior to the Merger; if the surrendered
         First American shares where held by such shareholder for a period of
         one year or less, the gain will constitute short-term capital gain.

                  (7)      The payment of cash to a First American shareholder
         in lieu of issuing a fractional share interest in SouthTrust Common
         Stock will be treated as if the fractional share actually was issued
         as part of the Merger and then was redeemed by SouthTrust. This cash
         payment will be treated as having been received as a distribution in
         full payment in exchange for



                                      41
<PAGE>   45



         the stock redeemed. Generally, any gain or loss recognized upon such
         exchange will be a capital gain or loss.

         The opinion of Bradley Arant Rose & White LLP is rendered solely with
respect to certain federal income tax consequences of the Merger under the
Code, and does not extend to the income or other tax consequences of the Merger
under the laws of any State or any political subdivision of any State. The
opinion also does not extend to any tax effects or consequences of the Merger
to SouthTrust, ST-Sub or ST-Bank other than those expressly stated in the
opinion. No opinion is expressed as to the federal tax treatment of the
transaction under any other provisions of the Code and regulations, or about
the tax treatment of any conditions existing at the time of, or effects
resulting from, the transaction that are not specifically covered by the
opinion.


                    DESCRIPTION OF SOUTHTRUST CAPITAL STOCK

GENERAL

         The authorized capital stock of SouthTrust consists of 500,000,000
shares of common stock, par value $2.50 per share (referred to throughout this
Proxy Statement/Prospectus as "SouthTrust Common Stock"), and 5,000,000 shares
of preferred stock, par value $1.00 per share ("SouthTrust Preferred Stock").
As of June 30, 1998, there were 164,675,600 shares of SouthTrust Common Stock
issued and outstanding, exclusive of shares held as treasury stock, and no
shares of SouthTrust Preferred Stock were outstanding. As of June 30, 1998,
there were 7,987,500 shares of SouthTrust Common Stock reserved for issuance
pursuant to employee benefit plans. In addition, 500,000 shares of SouthTrust
Preferred Stock designated as Series A Junior Participating Preferred Stock
were reserved for issuance upon the exercise of certain rights described below
under "DESCRIPTION OF SOUTHTRUST CAPITAL STOCK -- SouthTrust Common
Stock-Stockholder Rights Plan."

         Since SouthTrust is a holding company, the right of SouthTrust, and
hence the right of creditors and stockholders of SouthTrust, to participate in
any distribution of assets of any subsidiary (including ST-Bank) upon its
liquidation or reorganization or otherwise is necessarily subject to the prior
claims of creditors of the subsidiary, except to the extent that claims of
SouthTrust itself as a creditor of the subsidiary may be recognized.

         The following summary is not intended to be complete and is subject in
all respects to the applicable provisions of the General Corporation Law of the
State of Delaware and SouthTrust's Restated Certificate of Incorporation,
including the Certificate of Designations describing the Series A Junior
Participating Preferred Stock, and SouthTrust's Restated By-laws.

SOUTHTRUST COMMON STOCK

Dividend Rights

         Holders of SouthTrust Common Stock are entitled to dividends when, as
and if declared by SouthTrust's Board of Directors out of funds legally
available for payment of dividends, subject to any prior rights of any
SouthTrust Preferred Stock outstanding. Under Delaware law, SouthTrust may pay
dividends out of surplus (whether capital surplus or earned surplus) or net
profits for the fiscal year in which declared or for the preceding fiscal year,
even if its surplus accounts are in a deficit position. The sources of funds
for payment of dividends by SouthTrust are its subsidiaries. Because its
primary subsidiary is a bank, payments made by such subsidiary to SouthTrust
are limited by law and regulations of the bank regulatory authorities. See
"MARKET PRICE AND DIVIDEND INFORMATION RESPECTING THE SOUTHTRUST COMMON STOCK
AND THE FIRST AMERICAN COMMON STOCK."



                                      42
<PAGE>   46



Voting Rights and Other Matters

         The holders of SouthTrust Common Stock are entitled to one vote per
share on all matters brought before the stockholders. The holders of SouthTrust
Common Stock do not have the right to cumulate their shares of SouthTrust
Common Stock in the election of directors. SouthTrust's Restated Certificate of
Incorporation requires the vote of the holders of 70% of the voting power of
the outstanding voting securities of SouthTrust to approve a transaction or a
series of transactions with an "Interested Stockholder" (generally defined as a
holder of more than 10% of the voting stock of SouthTrust or an affiliate of
such a holder) pursuant to which SouthTrust would be merged into or with
another corporation or securities of SouthTrust would be issued in a
transaction which would permit control of SouthTrust to pass to another entity,
or similar transactions having the same effect. An exception exists in cases in
which either certain price criteria and procedural requirements are satisfied
or the transaction is recommended to the stockholders by a majority of the
members of SouthTrust's Board of Directors who are unaffiliated with the
Interested Stockholder and who were directors before the Interested Stockholder
became an Interested Stockholder.

         The SouthTrust Common Stock does not have any conversion rights, and
there are no redemption or sinking fund provisions applicable to the SouthTrust
Common Stock. Holders of SouthTrust Common Stock are not entitled to any
preemptive rights to subscribe for any additional securities which may be
issued.

Liquidation Rights

         In the event of liquidation, holders of SouthTrust Common Stock will
be entitled to receive pro rata any assets distributable to stockholders with
respect to the shares held by them, after payment of indebtedness and such
preferential amounts as may be required to be paid to the holders of any
SouthTrust Preferred Stock issued by SouthTrust.

Provisions with Respect to Board of Directors

         SouthTrust's Restated Certificate of Incorporation provides that the
members of SouthTrust's Board of Directors are divided into three classes as
nearly equal in number as possible. Stockholders elect each class for a
three-year term. At each annual meeting of stockholders of SouthTrust, the
stockholders elect roughly one-third of the members of SouthTrust's Board of
Directors for a three-year term, and the other directors will remain in office
until their three-year terms expire. Therefore, control of SouthTrust's Board
of Directors cannot be changed in one year, and at least two annual meetings
must be held before stockholders can change a majority of the members of
SouthTrust's Board of Directors.

Special Vote Requirements for Certain Amendments to Restated Certificate of
Incorporation

         The General Corporation Law of the State of Delaware and the Restated
Certificate of Incorporation and By-laws of SouthTrust provide that
stockholders may remove a director, or SouthTrust's entire Board of Directors,
only for cause. The Restated Certificate of Incorporation and By-laws of
SouthTrust also provide that the affirmative vote of the holders of at least
70% of the voting power of the outstanding capital stock entitled to vote for
the election of directors is required to remove a director or the entire Board
of Directors from office. Stockholders may amend certain portions of the
Restated Certificate of Incorporation of SouthTrust described in certain of the
preceding paragraphs, including those related to business combinations and the
classified Board of Directors, only by the affirmative vote of the holders of
70% of the voting power of the outstanding voting stock of SouthTrust.

Possible Effects of Special Provisions

         Certain of the provisions contained in the Restated Certificate of
Incorporation and By-laws of SouthTrust described above have the effect of
making it more difficult to change SouthTrust's Board of Directors, and may
make SouthTrust's Board of Directors less responsive to stockholder control.
These provisions also may tend to discourage attempts by third parties to
acquire SouthTrust because of the additional time and expense involved and



                                      43
<PAGE>   47



a greater possibility of failure. As a result, these provisions may adversely
affect the price that a potential purchaser would be willing to pay for the
capital stock of SouthTrust, thereby reducing the amount a stockholder might
realize in, for example, a tender offer for the capital stock of SouthTrust.

Stockholder Rights Plan

         On February 22, 1989, the Board of Directors of SouthTrust declared a
dividend to holders of SouthTrust Common Stock of record on March 6, 1989 (the
"Record Date") of one right (a "Right" and collectively, the "Rights") for, and
to be attached to, each share of SouthTrust Common Stock outstanding on the
Record Date. Each Right entitles the holder of the Right to purchase from
SouthTrust one one-hundredth of a share of SouthTrust Preferred Stock
designated as the Series A Junior Participating Preferred Stock ("Series A
Preferred Stock") at a purchase price of $75.00 (the "Purchase Price"). Such
resolutions also provide that as long as the Rights are attached to shares of
SouthTrust Common Stock as provided in the Rights Agreement referred to below,
the appropriate number of Rights will be issued with each share of SouthTrust
Common Stock issued after the Record Date. The number of Rights attached to or
to be issued with each share of SouthTrust Common Stock as well as the
redemption price for each Right, were appropriately decreased as a result of a
three-for-two stock split effected by SouthTrust on January 24, 1992, a
three-for-two stock split effected by SouthTrust on May 19, 1993, and a
three-for-two stock split effected by SouthTrust on February 26, 1998.
Accordingly, at the present time eight-twenty sevenths of a Right is attached
to each share of SouthTrust Common Stock and eight-twenty sevenths of a Right
will be issued with each share of SouthTrust Common Stock exchanged in the
Merger for First American Stock.

         The Rights will expire on February 22, 1999 unless redeemed earlier
and will not be exercisable or transferable separately from the shares of
SouthTrust Common Stock until the close of business on the Distribution Date,
which will occur on the earlier of (1) the tenth day following a public
announcement that a person (an "Acquiring Person") or any associate or
affiliate of an Acquiring Person has acquired, or obtained the right to
acquire, beneficial ownership of 20% or more of the outstanding SouthTrust
Common Stock (the "Stock Acquisition Date"); or (2) the tenth day following
commencement of a tender or exchange offer which would result in the ownership
of 20% or more of the outstanding SouthTrust Common Stock; or (3) the tenth day
after SouthTrust's Board of Directors declares, upon a determination by at
least a majority of SouthTrust's Disinterested Directors, that a person, alone
or with affiliates and associates (an "Adverse Person"), has become the
beneficial owner of a substantial amount (not to be less than 10%) of
outstanding SouthTrust Common Stock and that such person's ownership either is
intended to cause SouthTrust to take action adverse to its long-term interests
or may cause a material adverse impact on SouthTrust to the detriment of
SouthTrust's stockholders.

         -        Each holder of a Right will have the right to receive, upon
                  payment of the Purchase Price, in lieu of Series A Preferred
                  Stock, a number of shares of SouthTrust Common Stock (or, in
                  certain circumstances, cash or other property) having a value
                  equal to twice the Purchase Price in the event that:

         -        SouthTrust's Board of Directors determines that a person is an
                  Adverse Person;

         -        SouthTrust is the surviving corporation in a merger with an
                  Acquiring Person and SouthTrust's Common Stock remains
                  outstanding and unchanged and is not exchanged for securities
                  of the Acquiring Person or other property;

         -        an Acquiring Person receives a financial benefit or
                  advantage, through certain self-dealing transactions
                  involving SouthTrust, greater than that received by other
                  stockholders of SouthTrust or that which would have resulted
                  from arms-length negotiations;

         -        a person becomes the beneficial owner of 30% or more of the
                  outstanding SouthTrust Common Stock (except pursuant to a
                  "Fair Offer" as determined by the Disinterested Directors);
                  or



                                      44
<PAGE>   48



         -        while there is an Acquiring Person, an event involving
                  SouthTrust or any of its subsidiaries occurs which results in
                  the Acquiring Person's proportionate ownership interest being
                  increased by more than 1%.

         Rights are not exercisable following the occurrence of any of the
events set forth above until the expiration of the period during which the
Rights may be redeemed by SouthTrust as described below. Notwithstanding the
foregoing, after the occurrence of any of the events set forth above, Rights
that are (or, under certain circumstances, Rights that were) beneficially owned
by an Acquiring Person or an Adverse Person will be null and void.

         Unless the Rights are redeemed earlier, if, after the Distribution
Date, SouthTrust is acquired in a merger or other business combination in which
SouthTrust is not the surviving corporation or in which SouthTrust Common Stock
is changed into or exchanged for securities of any other person or other
property (other than a merger which follows a Fair Offer) or 50% or more of the
assets or earning power of SouthTrust and its subsidiaries (taken as a whole)
are sold or transferred, the Rights Agreement provides that each holder of
record of a Right will from and after that time have the right to receive, upon
payment of the Purchase Price, that number of shares of common stock of the
acquiring company which has value equal to twice the Purchase Price.

         At any time until ten days following the Stock Acquisition Date
(subject to certain provisions requiring action by a majority of the
Disinterested Directors, as defined in the Rights Agreement), SouthTrust may
redeem the Rights in whole, but not in part, at a price of $0.01 per Right.
Prior to the Distribution Date, SouthTrust may, except with respect to the
Purchase Price, redemption price or date of expiration of the Rights, amend the
Rights in any manner. At any time after the Distribution Date, SouthTrust may
amend the Rights in any manner that does not adversely affect the interest of
holders of the Rights as such.

         The Rights have certain anti-takeover effects and may adversely affect
a third party's attempt to acquire SouthTrust. The Rights will cause
substantial dilution to a person or group that attempts to acquire SouthTrust.
The Rights should not interfere with any merger or other business combination
approved by SouthTrust's Board of Directors since, among other things, the
Board of Directors may, at its option, under certain circumstances, redeem all
but not less than all of the then outstanding Rights at the redemption price,
as discussed above.

         The foregoing description of the Rights and the Series A Preferred
Stock is not intended to be complete and is qualified in its entirety by
reference to the Rights Agreement between SouthTrust and Mellon Bank, N.A. (now
known as ChaseMellon Shareholder Services LLC), as Rights Agent, and the
Certificate of Designation for the Series A Preferred Stock, copies of each of
which are exhibits to the Registration Statement of which this Proxy
Statement/Prospectus forms a part.

Transfer Agent

         The transfer agent for SouthTrust Common Stock is ChaseMellon
Shareholder Services LLC.

SOUTHTRUST PREFERRED STOCK

General

         Under SouthTrust's Restated Certificate of Incorporation, SouthTrust's
Board of Directors is authorized without further stockholder action to provide
for the issuance of up to 5,000,000 shares of SouthTrust Preferred Stock, in
one or more series, by adopting a resolution or resolutions providing for the
issuance of such series and determining the relative rights and preferences of
the shares of any such series with respect to the rate of dividend, call
provisions, payments on liquidation, sinking fund provisions, conversion
privileges and voting rights and whether the shares shall be cumulative,
non-cumulative or partially cumulative. The holders of SouthTrust Preferred
Stock would not have any preemptive right to subscribe for any shares issued by
SouthTrust. It is not possible to state the actual effect of the authorization
and issuance of SouthTrust Preferred Stock upon the rights of holders of
SouthTrust Common Stock unless and until SouthTrust's Board of Directors
determines the price and specific rights of the holders of a series of
SouthTrust Preferred Stock. Such effects might include, however,



                                      45
<PAGE>   49



         -        restrictions on dividends on SouthTrust Common Stock if
                  dividends on SouthTrust Preferred Stock have not been paid;

         -        dilution of the voting power of SouthTrust Common Stock to
                  the extent that SouthTrust Preferred Stock has voting rights,
                  or that any SouthTrust Preferred Stock series is convertible
                  into SouthTrust Common Stock;

         -        dilution of the equity interest of SouthTrust Common Stock
                  unless the SouthTrust Preferred Stock is redeemed by
                  SouthTrust; and

         -        SouthTrust Common Stock not being entitled to share in
                  SouthTrust's assets upon liquidation until satisfaction of
                  any liquidation preference granted SouthTrust Preferred
                  Stock.

         While the ability of SouthTrust to issue SouthTrust Preferred Stock
is, in the judgment of SouthTrust's Board of Directors, desirable in order to
provide flexibility in connection with possible acquisitions and other
corporate purposes, its issuance could impede an attempt by a third party to
acquire a majority of the outstanding voting stock of SouthTrust.

Series A Junior Participating Preferred Stock

         In connection with the adoption of the Stockholder Rights Plan
described above, SouthTrust's Board of Directors designated 500,000 shares of
SouthTrust's authorized but unissued SouthTrust Preferred Stock as Series A
Junior Participating Preferred Stock (which has been previously referred to as
the "Series A Preferred Stock"). The terms of the Series A Preferred Stock are
such that one share of Series A Preferred Stock will be approximately
equivalent in terms of dividend and voting rights, before adjustment for the
three-for-two stock split effected on January 24, 1992, the three-for-two stock
split effected on May 19, 1993, and the three-for-two stock split effected on
February 26, 1998, to 100 shares of SouthTrust Common Stock. No shares of
Series A Preferred Stock have been issued as of the date of this Proxy
Statement/Prospectus.



                                      46
<PAGE>   50



              MARKET PRICE AND DIVIDEND INFORMATION RESPECTING THE
          SOUTHTRUST COMMON STOCK AND THE FIRST AMERICAN COMMON STOCK

MARKET PRICE

         The SouthTrust Common Stock is quoted on NASDAQ under the symbol SOTR.
The following table sets forth, for the periods indicated, the high and low
sales prices per share of the SouthTrust Common Stock as reported by NASDAQ. On
_______________, 1998, the last reported sale price of the SouthTrust Common
Stock as reported by NASDAQ was $_______________. All prices are adjusted to
reflect a three-for-two stock split effected on February 26, 1998.

<TABLE>
<CAPTION>
                                                                    Price*
                                                        ------------------------------
                                                             High               Low
                                                             ----               ---
     <S>                                                <C>                <C>
     1996:

         First Quarter..............................    $   19.1719        $   16.8281
         Second Quarter.............................        19.0000            17.7500
         Third Quarter..............................        21.2500            17.6719
         Fourth Quarter.............................        24.0781            20.3281

     1997:

         First Quarter..............................        28.0781            22.7500
         Second Quarter.............................        28.2500            23.5781
         Third Quarter..............................        34.4531            27.5000
         Fourth Quarter.............................        42.8281            30.6719

     1998:

         First Quarter..............................        45.1250            35.7500
         Second Quarter ............................        45.0000            39.2500
         Third Quarter..............................        45.3750            30.6875
</TABLE>

- ------------------

*        The information listed above was obtained from the National
         Association of Securities Dealers, Inc., and reflects interdealer
         prices, without retail markup, markdown or commissions, and may not
         represent actual transactions.


         First American Stock is not traded on any exchange, and there is no
established public trading market for such stock. There are no bid or asked
prices available for First American Stock. Management of First American is
aware of certain transactions in First American Common Stock that have occurred
since January 1, 1996. Although the prices of all transactions are not known,
management of First American believes that such prices ranged from $32.00 to
$36.00 per share of First American Common Stock. No assurance can be given that
these trades were effected on an arm's-length basis. Transactions in First
American Common Stock are infrequent and are negotiated privately between
persons involved in those transactions.

         On June 26, 1998, the last sale price of SouthTrust Common Stock as
obtained from NASDAQ was $42.75. On July 2, 1998 and July 6, 1998 (the trading
days immediately before and after the public announcement of the Merger), the
last sale prices of SouthTrust Common Stock, as obtained from NASDAQ, were
$44.75 and



                                      47
<PAGE>   51



$44.9375, respectively; and on _______________, 1998, the last sale price of
SouthTrust Common Stock as obtained from NASDAQ was $_______________.


DIVIDENDS


         The following table sets forth, for the periods indicated, the
dividends declared by SouthTrust per share of SouthTrust Common Stock, as well
as the pro-forma dividend per share (based on the number of shares of
SouthTrust Common Stock to be issued per share of First American Common Stock)
after the Merger. The dividends have been adjusted to reflect a three-for-two
stock split effected on February 26, 1998. First American has never paid any
cash dividends on the First American Common Stock.

<TABLE>
<CAPTION>
                                                                                Pro-Forma
                                          SouthTrust                          Dividend Per
                                         Common Stock                           Share of
                                         Dividend Per                        First American
                                             Share                              Stock(1)
                                      ------------------                     --------------
<S>                                   <C>                                    <C>
1996:

    First Quarter                         $  0.1467                            $  0.2768
    Second Quarter                           0.1467                               0.2768
    Third Quarter                            0.1467                               0.2768
    Fourth Quarter                           0.1467                               0.2768

1997:


    First Quarter                            0.1667                               0.3146
    Second Quarter                           0.1667                               0.3146
    Third Quarter                            0.1667                               0.3146
    Fourth Quarter                           0.1667                               0.3146

1998:

    First Quarter                            0.1900                               0.3583
    Second Quarter                           0.1900                               0.3583
    Third Quarter                            0.1900                               0.3583
</TABLE>

- ---------------
(1)      The pro-forma dividend per share of First American Stock is equal to
         the SouthTrust Common Stock dividend per share multiplied by the
         Conversion Ratio and represents the dividend that would have been
         distributed on the number of shares of SouthTrust Common Stock to be
         received for each share of First American Common Stock. See
         "COMPARISON OF THE SOUTHTRUST COMMON STOCK AND THE FIRST AMERICAN
         STOCK."

         Dividends paid by SouthTrust on the SouthTrust Common Stock are at the
discretion of SouthTrust's Board of Directors and are affected by certain legal
restrictions on the payment of dividends as described below, SouthTrust's
earnings and financial condition and other relevant factors. SouthTrust has
increased the dividend paid on the SouthTrust Common Stock for 28 consecutive
years. The current policy of SouthTrust is to pay dividends on a quarterly
basis. Subject to an evaluation of its earnings and financial condition and
other factors, including the legal restrictions on the payment of dividends as
described below, SouthTrust anticipates that it will continue to pay regular
quarterly dividends with respect to the SouthTrust Common Stock.



                                      48
<PAGE>   52



         There are certain limitations on the payment of dividends to
SouthTrust by its bank subsidiary. As a national banking association, the
amount of dividends that SouthTrust's subsidiary bank may declare in one year,
without approval of the Comptroller, is the sum of the bank's retained net
profits for that year and its retained net profits for the preceding two years.
Under rules promulgated by the Comptroller, the calculation of net profits is
more restrictive under certain circumstances. Under the foregoing laws and
regulations, at December 31, 1997, approximately $472.5 million was available
for payment of dividends to SouthTrust by its bank subsidiary.

                               COMPARISON OF THE
                            SOUTHTRUST COMMON STOCK
                          AND THE FIRST AMERICAN STOCK

         The rights of First American shareholders are governed by the Articles
of Incorporation of First American, the Bylaws of First American and the laws
of the State of Florida. The rights of SouthTrust stockholders are governed by
the Restated Certificate of Incorporation of SouthTrust, the By-laws of
SouthTrust and the laws of the State of Delaware. After the Merger becomes
effective, the rights of First American shareholders who become SouthTrust
stockholders will be governed by the laws of the State of Delaware and by
SouthTrust's Restated Certificate of Incorporation and By-laws. The following
summary of the rights of the holders of SouthTrust Common Stock and the holders
of First American Common Stock is qualified in its entirety by reference to the
Restated Certificate of Incorporation and By-laws of SouthTrust, the Articles
of Incorporation and Bylaws of First American, the General Corporation Law of
the State of Delaware, the Florida Banking Code and the Florida Business
Corporation Act.

DIVIDENDS

         The sources of funds for payments of dividends by SouthTrust are its
subsidiaries. Because First American and the primary subsidiaries of SouthTrust
are financial institutions, payments made by such subsidiaries to SouthTrust
and by First American to its shareholders are limited by law and regulations of
the bank regulatory authorities. See "DESCRIPTION OF SOUTHTRUST CAPITAL STOCK -
SouthTrust Common Stock-Dividend Rights" and "MARKET PRICE AND DIVIDEND
INFORMATION RESPECTING THE SOUTHTRUST COMMON STOCK AND THE FIRST AMERICAN
STOCK" for information concerning the effect of such limitations on
SouthTrust's and First American's ability to pay dividends. Delaware General
Corporation Law provides that, subject to any restrictions in the corporation's
certificate of incorporation, dividends may be declared from the corporation's
surplus or, if there is no surplus, from its net profits for the fiscal year in
which the dividend is declared and the preceding fiscal year. Dividends may not
be declared, however, if the corporation's capital has been diminished to an
amount less than the aggregate amount of all capital represented by the issued
and outstanding stock of all classes having a preference upon the distribution
of assets. The Florida Banking Code provides that a Florida banking corporation
may declare dividends equal to the net profits of the period to which such
dividends relate plus its retained net profits of the preceding two years.
Further, with the approval of the Florida Department of Banking and Finance
(the "Florida Department"), a bank may declare a dividend from retained net
profits which accrued prior to the preceding two years. Notwithstanding the
foregoing, at least 20% of the bank's net profits must be carried over to the
bank's surplus fund until the surplus fund shall equal at least the amount of
its common and preferred stock then issued and outstanding. In any event, no
bank may declare any dividend at a time at which its net income for the current
year, combined with the retained net income for the preceding two years, is a
loss or which would cause the capital accounts of the bank to fall below the
minimum amounts required by state or federal law. Under the foregoing laws and
regulations, at June 30, 1998, approximately $786,000 was available for payment
of dividends to its shareholders by First American.

VOTING RIGHTS AND OTHER MATTERS

         All voting rights of SouthTrust are vested in holders of SouthTrust
Common Stock, subject to the rights, if any, of any series of their respective
classes of preferred stock, with the holder of each share of SouthTrust Common
Stock being entitled to one vote. All voting rights of First American are
vested in the holders of shares of First American Common Stock, with the holder
of each of such share being entitled to one vote. The holders of



                                      49
<PAGE>   53



SouthTrust Common Stock and First American Common Stock do not have the right
to cumulate their votes in the election of directors.

         As described above under the caption "DESCRIPTION OF SOUTHTRUST
CAPITAL STOCK - SouthTrust Common Stock - Voting Rights and Other Matters," the
Restated Certificate of Incorporation of SouthTrust requires the vote of the
holders of 70% of the outstanding voting securities of SouthTrust to approve a
transaction or a series of transactions with an Interested Stockholder
(generally defined as a holder of more than 10% of the voting stock of
SouthTrust or an affiliate of such holder) pursuant to which SouthTrust would
be merged into or with another corporation or securities of SouthTrust would be
issued in a transaction which would permit control of SouthTrust to pass to
another entity, or similar transactions having the same effect. The Restated
Certificate of Incorporation of SouthTrust provides an exception in cases in
which either certain price criteria and procedural requirements are satisfied
or the transaction is recommended to the stockholders by a majority of the
members of the Board of Directors of SouthTrust who are unaffiliated with the
Interested Stockholder and who were directors before the Interested Stockholder
became an Interested Stockholder. The Articles of Incorporation and Bylaws of
First American do not contain any prohibitions of or limitations on
transactions between First American and a related party or shareholder.

         SouthTrust is subject to Section 203 of the Delaware General
Corporation Law. That section generally provides that a corporation may not
engage in a business combination, except with extraordinary corporate approval,
with any person deemed to be an "interested stockholder" for a period of three
years following the date that the stockholder became an interested stockholder.
An "interested stockholder" is defined as any person who directly or indirectly
owns 15% or more of the outstanding voting stock of the corporation within the
three-year period beginning immediately prior to the date on which such
determination is made. The extraordinary corporate approval must consist of
board approval prior to the time the person became an interested stockholder or
approval of the transaction by the board of directors and at least two-thirds
of the outstanding voting stock which is not owned by the interested
stockholder; in the absence of such approval, the interested stockholder must
own at least 85% of the voting stock of the corporation.

         First American is subject to Section 607.0901 of the Florida Business
Corporation Act. That section generally provides that a business combination
with any person deemed to be an "interested shareholder" must be approved by
the affirmative vote of the holders of two-thirds of the voting shares other
than the shares beneficially owned by the interested shareholder unless any of
the following conditions apply to the transaction:

         -        the transaction has been approved by a majority of the
                  disinterested directors;

         -        the corporation has not had more than 300 shareholders of
                  record at any time during the three years proceeding the
                  announcement of such transaction;

         -        the interested shareholder has been a beneficial owner of at
                  least 80% of the corporation's outstanding voting shares for
                  at least five years preceding the announcement of such
                  transaction;

         -        the interested shareholder is the beneficial owner of at
                  least 90% of the outstanding voting shares of the
                  corporation, exclusive of shares acquired directly from the
                  corporation in a transaction not approved by a majority of
                  disinterested directors;

         -        the corporation is an investment company registered under the
                  Investment Company Act of 1940; or

         -        consideration will be paid to holders of each class or series
                  of voting shares of the corporation and certain conditions
                  concerning the consideration received are met.



                                      50
<PAGE>   54



         An "interested shareholder" is defined as any person who directly or
indirectly owns more than 10% of the outstanding voting shares of a
corporation. First American is also subject to Section 607.0902 of the Florida
Business Corporation Act. That section generally provides that, in the event a
person acquires shares in a corporation giving that person certain levels of
voting control of the corporation, such person's shares will have the same
voting rights as other shareholders' shares only to the extent granted by
resolution approved by the shareholders of the corporation.

         The effect of the business combination and affiliated transactions
provisions is to make more difficult the acquisition of a majority control of a
corporation or the use of its assets to finance such acquisition.

         The Delaware General Corporation Law enumerates several situations in
which class voting is required with respect to amendments to a corporation's
certificate of incorporation, whether or not the holders of such shares are
entitled to vote thereon by the provisions of the certificate of incorporation.
Class voting is required on amendments which: (1) increase or decrease the
aggregate number of authorized shares, (2) increase or decrease the par value
of the shares of such class, or (3) alter or change the powers, preferences or
special rights of the shares of such class as to affect them adversely.
However, in such situations, only the shares of the series affected by the
amendment will be considered a separate class for the purpose of the class
voting requirements. Furthermore, the authorized shares of any class of stock
may be increased or decreased by the affirmative vote of a majority of the
stockholders, irrespective of the class voting requirement set forth above, if
so provided in the original certificate of incorporation or in any amendments
thereto which created such class of stock or which were authorized by a
resolution adopted by the affirmative vote of the holders of a majority of
shares of such class.

         The Florida Business Corporation Act enumerates several situations in
which class voting is required with respect to amendments of a corporation's
articles of incorporation, whether or not the holders of such shares are
entitled to vote thereon by the provisions of the articles of incorporation.
Class voting is required on amendments which:

         -        increase or decrease the aggregate number of authorized
                  shares of the class;

         -        effect an exchange reclassification of all or part of the
                  shares of the class into shares of another class;

         -        effect an exchange reclassification, or create a right of
                  exchange, of all or part of the shares of another class into
                  the shares of the class;

         -        change the designation, rights, preferences, or limitations
                  of all or part of the shares of the class;

         -        change the shares of all or part of the class into a
                  different number of shares of the same class;

         -        create a new class of shares having rights or preferences
                  with respect to distributions or dissolution that are prior,
                  superior, or substantially equal to the shares of the class;

         -        increase the rights, preferences, or number of authorized
                  shares of any class that, after giving effect to the
                  amendment, have rights or preferences with respect to
                  distributions or to dissolution that are prior, superior, or
                  substantially equal to the shares of the class;

         -        limit or deny existing preemptive rights on all or part of
                  the shares of the class; or



                                      51
<PAGE>   55



         -        cancel or otherwise affect rights to distributions or
                  dividends that have accumulated but not yet been declared on
                  all or part of the shares of the class.

         Additionally, if a proposed amendment to a corporation's articles of
incorporation entitling two or more series of shares to vote as separate
classes would affect those two or more series in the same or substantially
similar way, shares of all the series so affected must vote together as a
single class on the proposed amendment. Voting by class or series as a separate
voting group is required on a plan of merger if the plan contains a provision
which, if contained in a proposed amendment to the articles of incorporation,
would entitle the class or series to vote as a separate voting group on the
proposed amendment.

         The By-laws of SouthTrust provide that the members of SouthTrust's
Board of Directors are to be divided into three classes as nearly equal as
possible. Each such class is elected for a three-year term. At each annual
meeting of stockholders, the stockholders elect roughly one-third of the
members of SouthTrust's Board of Directors for a three-year term, and the other
directors will remain in office. Therefore, control of SouthTrust's Board of
Directors cannot be changed in one year, and at least two annual meetings must
be held before a majority of the members of SouthTrust's Board of Directors can
be changed. Without this provision in the Bylaws of SouthTrust, all directors
would stand for election at each annual meeting. The Bylaws of First American
provide that the entire Board of Directors of First American is to be elected
by majority vote of the shares entitled to vote at an annual meeting of
shareholders at which such election is to occur. Directors so elected serve for
a term of one year and until their successors shall be elected and shall
qualify.

         Both the Delaware General Corporation Law and Florida Business
Corporation Act provide (unless otherwise provided in a corporation's charter
or bylaws), that the shareholders may remove a director, or the entire board of
directors, with or without cause by vote of the holders of a majority of the
shares of capital stock of the corporation then entitled to vote on the
election of directors. The Restated Certificate of Incorporation and By-laws of
SouthTrust, however, provide that the affirmative vote of the holders of at
least 70% of the voting power of the outstanding capital stock entitled to vote
for the election of directors is required to remove a director or SouthTrust's
entire Board of Directors from office and such removal may be effected only for
cause. The vacancy created by any such removal will then be filled by majority
vote of the directors then in office, and the successor director so elected
will fill the unexpired term of the director removed from office. The Bylaws of
First American provide that any or all of the directors may be removed with or
without cause by vote of a majority of all of the shares outstanding and
entitled to vote at a special meeting of shareholders called for that purpose.

         The By-laws of SouthTrust also provide that the remaining directors
may fill any vacancies on SouthTrust's Board of Directors, caused by the death
or resignation of a director or the creation of a new directorship. A person
selected by the remaining directors to fill a vacancy will serve until the
annual meeting of stockholders at which the term of the class of directors to
which such director has been appointed expires. Therefore, if a director who
was recently elected to a three-year term resigns, the remaining directors will
be able to select a person to serve the remainder of that three-year term, and
such person will not be required to stand for election until the third annual
meeting of stockholders after such director's appointment. The Bylaws and
Articles of First American provide that the stockholders may authorize the
Board of Directors to increase the number of directors by no more than two
directors in any one year and, by a majority vote, appoint qualified persons to
fill the resulting vacancies. The Bylaws and Articles of First American do not
otherwise address vacancies created in the Board of Directors.

         Under the Delaware General Corporation Law (unless otherwise provided
in a corporation's charter), any action required or permitted to be taken by
the stockholders of a corporation may be taken without a meeting and without a
stockholder vote if a written consent is signed by the holders of the shares of
outstanding stock having the requisite number of votes that would be necessary
to authorize such action at a meeting of stockholders at which all shares
entitled to vote thereon were present and voted. Under the Restated Certificate
of Incorporation of SouthTrust, action by written consent of the stockholders
is prohibited. Further, under the Restated Certificate of Incorporation and
By-laws of SouthTrust, the stockholders are not permitted to call a special
meeting of stockholders or to require that SouthTrust's Board of Directors call
such a meeting. Under the Florida Business Corporation Act, any action required
or permitted to be taken by the shareholders of a corporation may be taken 



                                      52
<PAGE>   56



without a meeting and without a shareholder vote if a written consent is signed
by all of the holders of the outstanding capital stock of the corporation.

         Certain portions of the Restated Certificate of Incorporation of
SouthTrust described in certain of the preceding paragraphs, including those
related to business combinations and SouthTrust's classified Board of
Directors, may be amended only by the affirmative vote of the holders of 70% of
the outstanding voting stock of SouthTrust. First American's Articles of
Incorporation generally may be amended by shareholders upon recommendation of
the Board of Directors. Amendments to the Articles of Incorporation of First
American also require the approval of the Florida Department of Banking and
Finance. The Bylaws of First American may be amended by the affirmative vote of
a majority of the shareholders present and voting at any special or annual
meeting, provided a statement of the proposed amendment is contained in the
notice of the meeting, or by the affirmative vote of a majority of all the
directors present and voting at any regular or special meeting of First
American's Board of Directors, provided that in the case of a special meeting a
statement of the proposed amendment is contained in the notice of the meeting.

         The provisions contained in the Restated Certificate of Incorporation
of SouthTrust described above have the effect of making it more difficult to
change SouthTrust's Board of Directors, and may make SouthTrust's Board of
Directors less responsive to shareholder control. Those provisions also may
tend to discourage attempts by third parties to acquire SouthTrust because of
the additional time and expense involved and a greater possibility of failure.
This also can affect the price that a potential purchaser would be willing to
pay for the stock of SouthTrust, thereby reducing the amount a stockholder
might realize in, for example, a tender offer for the stock of SouthTrust.

DISSENT AND APPRAISAL RIGHTS

         A shareholder of First American has dissent and appraisal rights
pursuant to Section 215a of the United States Code (the "NBA Dissent
Provisions"). Section 215a of the United States Code is the controlling
provision relating to the dissent rights of First American shareholders in
light of Section 658.41(2) of the Florida Banking Code which provides that
federal, rather than Florida law, will be controlling in the merger of a
Florida bank into a national bank. Under the NBA Dissent Provisions, a
shareholder of First American may dissent from the Merger and receive the value
of the shares of First American Common Stock (as calculated in accordance with
the NBA Dissent Provisions) in lieu of the stated merger consideration.

         Under Section 262 of the General Corporation Law of Delaware (the
"Delaware Dissent Provisions"), a stockholder has no right to dissent to a
merger if, at the record date, the shares of the corporation were listed on a
national securities exchange, designated as a national market system security
on NASDAQ or held by more than 2,000 stockholders. Since the shares of
SouthTrust Common Stock are listed on NASDAQ and held by more than 2,000
stockholders of record, the stockholders of SouthTrust do not have any right to
dissent pursuant to the Delaware Dissent Provisions.

RIGHTS ON LIQUIDATION

         In the event of liquidation, the holders of SouthTrust Common Stock
and the holders of First American Common Stock will be entitled to receive pro
rata any assets distributable to stockholders with respect to the shares held
by them, after payment of indebtedness and such preferential amounts as may be
required to be paid to the holders of any preferred stock presently outstanding
or hereafter issued by either corporation.

PREEMPTIVE RIGHTS

         The holders of SouthTrust Common Stock and First American Stock do not
have any preemptive rights to purchase additional shares of any class of
securities, including common stock, of SouthTrust or First American,
respectively, which may hereafter be issued.



                                      53
<PAGE>   57



REPORTS TO STOCKHOLDERS AND SHAREHOLDERS

         The SouthTrust Common Stock is registered under the Exchange Act, and,
therefore, SouthTrust is required to provide annual reports containing audited
financial statements to stockholders and to file other reports with the
Commission and solicit proxies in accordance with the rules of the Commission.
SouthTrust also provides reports to its stockholders on an interim basis
containing unaudited financial information.

         The First American Common Stock is not registered under the Exchange
Act. First American provides its shareholders with annual reports containing
audited financial statements of First American. In addition, First American
regularly files reports with the FDIC and the Florida Department of Banking,
certain of which may be inspected by the public.

STOCKHOLDERS' RIGHTS PLAN

         As described above under the caption "DESCRIPTION OF SOUTHTRUST
CAPITAL STOCK - SouthTrust Common Stock - Stockholder Rights Plan," presently
attached to each share of SouthTrust Common Stock is eight-twenty sevenths of a
Right issued pursuant to the Rights Agreement described under such caption.
Each Right entitles the holder thereof to purchase from SouthTrust one
one-hundredth of a share of Series A Preferred Stock at the Purchase Price.
First American has not adopted any similar plan.


                           SUPERVISION AND REGULATION


SOUTHTRUST

General

         SouthTrust is a bank holding company within the meaning of the Bank
Holding Company Act and is registered with the Federal Reserve Board. ST-Bank,
SouthTrust's banking subsidiary, is subject to restrictions under federal law
which limit the transfer of funds by ST-Bank to SouthTrust and its nonbanking
subsidiaries, whether in the form of loans, extensions of credit, investments
or asset purchases. Such transfers by ST-Bank to SouthTrust or any nonbanking
subsidiary are limited in amount to 10% of ST-Bank's capital and surplus and,
with respect to SouthTrust and all such nonbanking subsidiaries, to an
aggregate of 20% of ST-Bank's capital and surplus. Furthermore, such loans and
extensions of credit are required to be secured in specified amounts. The Bank
Holding Company Act also prohibits, subject to certain exceptions, a bank
holding company from engaging in or acquiring direct or indirect control of
more than 5% of the voting stock of any company engaged in nonbanking
activities. An exception to this prohibition is for activities expressly found
by the Federal Reserve Board to be so closely related to banking or managing or
controlling banks as to be a proper incident thereto.

         As a bank holding company, SouthTrust is required to file with the
Federal Reserve Board periodic reports and such additional information as the
Federal Reserve Board may require. The Federal Reserve Board may also make
examinations of SouthTrust and each of its subsidiaries.

         The approval of the Comptroller is required for any dividend proposed
to be paid by ST-Bank to SouthTrust if the total of all dividends declared by
ST-Bank in any calendar year would exceed the total of its retained net
profits, as defined by the Comptroller, for that year, combined with its
retained net profits for the preceding two years, less any required transfers
to surplus or a fund for the retirement of any preferred stock. Under the
foregoing laws and regulations, at June 30, 1998, approximately $400.0 million
was available for payment of dividends to SouthTrust by its subsidiaries,
primarily ST-Bank. The payment of dividends by ST-Bank may also be affected by
other factors, such as the maintenance of adequate capital for ST-Bank. In
addition to the foregoing restrictions, the Federal Reserve Board has the power
to prohibit the payment of dividends by bank holding companies if their actions
constitute unsafe or unsound practices. The Federal Reserve Board has issued a
policy statement on the payment of cash dividends by bank holding companies,
which expresses the Federal Reserve Board's view that a bank holding company
experiencing earnings weaknesses should not pay cash



                                      54
<PAGE>   58



dividends that exceed its net income or that could only be funded in ways that
weaken the bank holding company's financial health, such as by borrowing.
Furthermore, the Comptroller has the authority to prohibit the payment of
dividends by a national bank when it determines such payment to be an unsafe
and unsound banking practice.

Capital Adequacy

         Under the Federal Reserve Board's risk-based capital guidelines
applicable to SouthTrust, the minimum ratio of capital to risk-weighted assets
(including certain off-balance sheet items, such as standby letters of credit)
is 8%. To be considered a "well capitalized" bank under the guidelines, a bank
must have a total risk-based capital ratio in excess of 10%. At June 30, 1998,
ST-Bank was considered "well capitalized." Under these guidelines, at least
half of the total capital is to be comprised of common equity, retained
earnings and a limited amount of perpetual preferred stock, after subtracting
certain intangibles, and certain other adjustments ("Tier 1 capital"). The
remainder may consist of perpetual debt, mandatory convertible debt securities,
a limited amount of subordinated debt, other preferred stock not qualifying for
Tier 1 capital and a limited amount of loan loss reserves. ST-Bank is subject
to similar capital requirements adopted by the Comptroller. In addition, the
Federal Reserve Board, the Comptroller and the Federal Deposit Insurance
Corporation (the "FDIC") have adopted a minimum leverage ratio (Tier 1 capital
to adjusted quarterly average assets) of 3%. Generally, banking organizations
are expected to operate well above the minimum required capital level of 3%
unless they meet certain specified criteria, including that they have the
highest regulatory ratings. Most banking organizations are required to maintain
a leverage ratio of 3% plus an additional cushion of at least 1% to 2%. The
guidelines also provide that banking organizations experiencing internal growth
or making acquisitions will be expected to maintain strong capital positions
substantially above the minimum supervisory levels without significant reliance
upon intangible assets. On December 31, 1997, ST-Bank had a Tier 1 capital
ratio of 7.76%, a total risk-based capital ratio of 10.87% and a leverage ratio
of 6.66%.

         Failure to meet capital guidelines could subject a banking institution
to a variety of enforcement remedies available to federal regulatory
authorities, including the termination of deposit insurance by the FDIC,
issuance of a capital directive, a prohibition on the taking of brokered
deposits and certain other restrictions on its business.

         The Federal Deposit Insurance Corporation Improvement Act of 1991
("FDICIA") substantially revised the depositary institution regulatory and
funding provisions of the Federal Deposit Insurance Act as well as several
other federal banking statutes. Among other things, FDICIA requires the federal
banking regulators to take prompt corrective action in respect of depositary
institutions that do not meet minimum capital requirements. FDICIA establishes
five capital tiers: "well capitalized," "adequately capitalized,"
"undercapitalized," "significantly undercapitalized" and "critically
undercapitalized." A depository institution is well capitalized if it
significantly exceeds the minimum level required by regulation for each
relevant capital measure, is adequately capitalized if it meets each such
measure, is undercapitalized if it fails to meet any such measure, is
significantly undercapitalized if it is significantly below such measure and is
critically undercapitalized if it fails to meet any critical capital level set
forth in applicable regulations. The critically undercapitalized level occurs
where tangible equity is less than 2% of total tangible assets or less than 65%
of the minimum leverage ratio to be prescribed by regulation (except to the
extent that 2% would be higher than such 65% level). A depository institution
may be deemed to be in a capitalization category that is lower than is
indicated by its actual capital position if it receives an unsatisfactory
examination rating.

         FDICIA generally prohibits a depository institution from making any
capital distribution (including payment of a dividend) or paying any management
fee to its holding company if the depository institution would thereafter be
undercapitalized. Undercapitalized depository institutions became subject to
restrictions on borrowing from the Federal Reserve System, effective as of
December 19, 1993. In addition, undercapitalized depository institutions are
subject to growth limitations and are required to submit capital restoration
plans. A depository institution's holding company must guarantee the capital
plan, up to an amount equal to the lesser of 5% of the depository institution's
assets at the time it becomes undercapitalized or the amount of the capital
deficiency when the institution fails to comply with the plan. The federal
banking agencies may not accept a capital plan without determining, among other
things, that the plan is based on realistic assumptions and is likely to
succeed in restoring



                                      55
<PAGE>   59



the depository institution's capital. If a depository institution fails to
submit an acceptable plan, it is treated as if it is significantly
undercapitalized.

         Significantly undercapitalized depository institutions may be subject
to a number of requirements and restrictions, including orders to sell
sufficient voting stock to become adequately capitalized, requirements to
reduce total assets and cessation of receipt of deposits from correspondent
banks. Critically undercapitalized depository institutions are subject to
appointment of a receiver or conservator.

Source of Strength

         According to Federal Reserve Board policy, bank holding companies are
expected to act as a source of financial strength to each subsidiary bank and
to commit resources to support each such subsidiary. This support may be
required at times when a bank holding company may not be able to provide such
support.

The Riegle-Neal Interstate Banking and Branching Efficiency Act

         The Interstate Banking Act provides that, adequately capitalized and
managed bank holding companies are permitted to acquire banks in any state.
State laws prohibiting interstate banking or discriminating against
out-of-state banks were preempted as of the effective date, although states
were permitted to require that target banks located within the state be in
existence for a period of up to five years before such bank may be subject to
the Interstate Banking Act. The Interstate Banking Act establishes deposit caps
which prohibit acquisitions that would result in the acquiror controlling 30%
or more of the deposits of insured banks and thrifts held in the state in which
the acquisition or merger is occurring or in any state in which the target
maintains a branch or 10% or more of the deposits nationwide. State-level
deposit caps are not preempted as long as they do not discriminate against
out-of-state acquirors, and the federal deposit caps apply only to initial
entry acquisitions.

         In addition, the Interstate Banking Act provides that as of June 1,
1997, adequately capitalized and managed banks may engage in interstate
branching by merging banks in different states and allowing banks to maintain
branches in states other than the states where they maintain their principal
place of business. Acting pursuant to this authorization, SouthTrust, effective
June 2, 1997, consolidated all of its then existing banking subsidiaries into
its largest banking subsidiary and changed the subsidiary's name to SouthTrust
Bank, National Association.

         Proposals to change the laws and regulations governing the banking
industry are frequently introduced in Congress, in the state legislatures and
before the various bank regulatory agency. The likelihood and timing of any
such changes and the impact such changes might have on SouthTrust and its
subsidiaries, however, cannot be determined at this time.



                                      56
<PAGE>   60



FIRST AMERICAN

         First American is chartered by the State of Florida. It is subject to
comprehensive regulation, examination and supervision by the Florida Department
and the Federal Reserve, and is subject to other laws and regulations
applicable to banks. Such regulations include limitations on loans to a single
borrower and to its directors, officers and employees; restrictions on the
opening and closing of branch offices; the maintenance of required capital and
liquidity ratios; the granting of credit under equal and fair conditions;
disclosure of the cost and terms of such credit; restrictions as to permissible
investments and governance of other aspects of First American's business and
operations. First American is examined periodically by both the Florida
Department and the Federal Reserve, and submits regular periodic reports
regarding its financial condition and other matters to each of them. Both the
Florida Department and the Federal Reserve have a broad range of powers to
enforce regulations under their respective jurisdictions, and to take
discretionary actions determined to be for the protection of the safety and
soundness of First American, including the institution of cease and desist
orders and the removal of directors and officers. First American's deposit
accounts are insured by the Bank Insurance Fund of the FDIC up to a maximum of
$100,000 per insured depositor. The FDIC issues regulations, has authority to
conduct periodic examinations, requires the filing of reports and generally
supervises the operations of its insured banks. This supervision and regulation
is intended primarily for the protection of depositors.

         Any insured bank which is not operated in accordance with or does not
conform to Federal Reserve or FDIC regulations, policies and directives may be
sanctioned for non-compliance. Proceedings may be instituted against any
insured bank or any director, officer, or employee of such bank engaging in
unsafe and unsound practices, including the violation of applicable laws and
regulations. The Federal Reserve and the FDIC have the authority to terminate
insurance of accounts pursuant to procedures established for that purpose.


         CERTAIN INFORMATION CONCERNING THE BUSINESS OF FIRST AMERICAN

GENERAL

         First American was organized in 1984 as a commercial Florida banking
corporation with the primary purpose of serving the banking needs of Indian
River County, Florida and its surrounding areas. First American began operating
on November 19, 1984. First American opened its first branch bank facility on
May 20, 1996. First American is headquartered in Vero Beach, Florida, and as of
June 30, 1998, First American had assets of $45.3 million, deposits of $40.3
million, and stockholder's equity of $4.8 million.

         Since its origination in 1984, First American has provided both
traditional commercial banking services, including but not limited to interest
and non-interest bearing checking accounts, savings accounts, money market
deposit accounts, certificates of deposit, individual retirement accounts as
well as commercial loans, real estate mortgage loans, and consumer loans.

         First American provides commercial banking services primarily to
residents of Indian River County, Florida through two banking offices, one
located at 4000 20th Street, Vero Beach, Florida 32960, which serves as the
principal office of First American, and the other located at 780 U.S. Highway
1, Suite 101, Vero Beach, Florida 32960. First American offers ATM service at
its principal office.

         First American acts as a depository for treasury, tax, and loan
payments. First American also acts as an issuing agent for traveler's checks
and assists those customers who purchase U.S. Savings Bonds. First American
offers full teller services, wire transfer services, ACH receipt and
origination services, safe deposit boxes, drive in banking, and night
depository services at all locations, and also offers an ATM machine at its
20th Street location.

         The business of First American consists primarily of attracting retail
deposits from the general public in the area serviced by First American's
offices and using the funds generated from the deposits to make secured and
unsecured commercial loans, loans for the purchase, construction, financing,
and refinancing of commercial and



                                      57
<PAGE>   61



residential real estate in First American's primary market area of Indian River
County, Florida and its surrounding areas. First American also makes consumer
purpose loans.

         The principal sources of funds for First American's lending and
investment activities are deposits, repayment of loans, and proceeds from the
sale of investment securities. First American's revenues are lending and
deposit activities. First American's principal expenses are interest paid on
deposits and general operating expenses such as salaries, employee benefits,
and occupancy expenses.

         First American offers a range of short to medium term commercial and
consumer loans. Commercial loans include, but are not limited to, both secured
and unsecured financing for working capital (including inventory and
receivables), business expansion loans (including acquisition of real estate
and improvements), purchase of equipment and machinery, as well as construction
of investment property such as residences, apartment complexes, and office
buildings. Consumer purpose loans include secured and unsecured loans for
financing automobiles, home improvements, and other personal expenditures.
First American also originates a variety of residential real estate loans
including mortgage loans that are collateralized by first or second mortgages
for purchase, refinance, or home improvement.

         First American provides a variety of banking services to individuals,
businesses, and other institutions located in First American's primary market
area. Deposit services include non-interest and interest bearing checking
accounts, money market deposit accounts, savings accounts, certificates of
deposit, and individual retirement accounts. Interest bearing deposit products
carry rates of interest that First American believes are generally competitive
to other rates that are offered in the market area served by First American.
All deposit account service charges are also competitive with other fee
schedules offered in the market area served by First American. All deposit
accounts are insured by FDIC to the maximum extent provided by law.

         First American offers ATM cards with access to local, state, national,
and international networks. First American offers safe deposit boxes, wire
transfer services, direct deposit services, and ACH origination services at all
of its banking locations.

         First American encounters vigorous competition both in making loans
and attracting deposits. The deregulation of the banking industry and the
evolution of interstate banking has created a highly competitive environment
for commercial banking in First American's market area. First American competes
with other local, regional, and national commercial banks as well as with
credit unions, finance companies, security brokerage companies, investment
management firms, mutual funds, insurance companies, and other financial
intermediaries operating in First American's market area. Many of these
competitors have substantially greater resources and have higher lending limits
than First American, and they also offer certain services, such as fiduciary
services, that First American does not provide.

         Indian River County, Florida is serviced by approximately ten
commercial banks with 41 branch offices, one credit union, two savings banks
and approximately 15 brokerage firms. Competition among financial institutions
is largely based upon interest rates offered on deposit accounts and loans,
service charges on deposits, the quality of services rendered, the convenience
of banking facilities, and in the case of commercial borrowers, relative
lending limits.

         As is the case with all financial institutions, generally First
American's operations and profitability are significantly influenced by general
economic conditions and by the related monetary and fiscal policies of the
Federal Reserve System. Deposit flows and interest rates on competing
investments and general market rates of interest influence First American's
cost of funds. Lending activities are affected by the demand for financing of
real estate and other types of loans which in turn are affected by the interest
rate at which such financing may be offered and other factors that affect local
demand and availability of funds.



                                      58
<PAGE>   62



EMPLOYEES

         As of June 30, 1998, First American had 24 full time employees, none
of whom are represented by a collective bargaining agreement. Management
believes that employee relations are good.


DESCRIPTION OF PROPERTIES

         The main office of First American is located at 4000 20th Street, Vero
Beach, Florida, which location is owned by First American and contains 3,570
square feet of office space and 1,330 square feet of space for drive- through
lanes. First American's branch office located at 780 U.S. Highway 1, Suite 101,
Vero Beach, Florida is subject to a lease which includes several renewal
options the last of which expires in 2012.


LEGAL PROCEEDINGS

         First American is from time to time a party to litigation which arises
in the normal course of First American's business. First American does not have
any pending litigation that separately or in the aggregate is currently
expected to have a material adverse effect upon the operating results or
financial condition of First American.


REGULATION AND LEGISLATION

         As a state chartered bank, First American is subject to extensive
examination by the Florida Department. First American is also a member bank of
the Federal Reserve and is subject to regulation and examination by the Federal
Reserve. First American files reports with both regulatory bodies concerning
First American's financial condition and must obtain approval from those
regulatory agencies prior to entering into certain transactions. Periodic
safety and soundness examinations are performed by the Florida Department and
by the Federal Reserve. Both regulatory authorities monitor First American's
compliance with all applicable regulations and laws on a continuous basis.


CERTAIN RELATIONSHIPS AND RELATED-PARTY TRANSACTIONS

         First American's officers and directors and certain business
organizations and individuals associated with them have been customers of First
American, have had banking transactions with First American, and are expected
to continue such transactions in the future. In connection with such
transactions, First American's directors have borrowed funds from time to time
for various business and personal reasons. The extensions of credit made by
First American to its directors and officers (1) were made in the ordinary
course of business, (2) were made on substantially the same terms, including
interest rates and collateral requirements as those prevailing at the time for
comparable transactions with other persons, and (3) do not involve more than a
normal risk of collectibility or present other unfavorable features.


BENEFICIAL OWNERSHIP OF FIRST AMERICAN COMMON STOCK

         The following table sets forth, as of September 30, 1998, (a) the
names of the persons known by First American to be beneficial owners of more
than 5% of shares of First American Common Stock, and the name of each of First
American's directors and executive officers, (b) the number and percentage of
shares of First American Common Stock owned by each person and by all of the
directors and executive officers of First American as a group; and (c) the
estimated number of shares of SouthTrust Common Stock each such person or group
is expected to receive as a result of the Merger (assuming that such persons do
not exercise their rights to dissent)



                                      59
<PAGE>   63



calculated by multiplying the number of shares of First American Common Stock
beneficially owned by such person or group by the Conversion Ratio as set forth
in the Merger Agreement.

<TABLE>
<CAPTION>
                                                                                          Estimated
                                                                                           Number
                                                 Number of                                of Shares
                                                 of Shares                              of SouthTrust
                                                Beneficially          Percentage of     Common Stock
     Beneficial Owner                            Owned(1)             Total Shares(2)    to be Owned
- -------------------------------                 ------------          ---------------   --------------
<S>                                             <C>                   <C>               <C>
DIRECTORS:
Samuel A. Block                                        6,050               4.7                11,419
Allen A. Edwards(3)                                    8,470               6.6                15,987
Ronald E. Ewing                                        6,050               4.7                11,419
Paul E. Koehler                                          726               0.6                 1,370
Robert J. MacWilliam (4)                              10,104               7.8                19,071
Ronald R. McCall, Sr.                                  4,235               3.3                 7,993
Angelo J. Sanchez                                        935               0.7                 1,764
Charles R. Sexton, Sr.                                 6,050               4.7                11,419
D.B. Smith (5)                                         7,601               5.9                14,347
Andrew W. Williams (6)                                10,224               7.9                19,298
Steven C. Shackley                                       181               0.1                   341
                                                ------------          --------           -----------
All Directors &                                       60,626                47%              114,428
Executive Officers as Group
(a total of 11 people)
</TABLE>

(1)  Under applicable regulations of the Securities and Exchange Commission,
     shares are considered to be beneficially owned by a person if such person
     either (a) directly or indirectly has or shares a power to vote or dispose
     of the shares whether or not such person has any economic interest in the
     shares, or (b) has the right to acquire such shares within 60 days of the
     date of this Proxy Statement/Prospectus. Unless otherwise indicated, the
     named beneficial owner has the sole voting and investment power with
     respect to the shares reports.

(2)  For the purpose of computing beneficial ownership and the percentage of
     outstanding shares held by each person or group of persons on a given
     date, shares which such person or group has the right to acquire within 60
     days after such date are shares for which such person has beneficial
     ownership and are deemed to be outstanding for purposes of computing the
     percentage for such person, but are not deemed to be outstanding for the
     purpose of computing the percentage of any other person.

(3)  The address for Allen A. Edwards is 18 Tarpon Drive, Vero Beach, Florida
     32963.

(4)  The address for Robert J. MacWilliam is 440 45th Court, Vero Beach,
     Florida 32968. The amounts shown for Mr. MacWilliam do not include 5,500
     shares held as options that are fully vested.

(5)  The address for D.B. Smith is 1635 51st Court, Vero Beach, Florida 32966.

(6)  The address for Andrew W. Williams is 176 Ocean Way, Vero Beach, Florida
     32963.


   FIRST AMERICAN MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
                           AND RESULTS OF OPERATIONS

GENERAL

         This analysis has been prepared to provide insight into the financial
condition of First American and addresses the factors which have affected First
American's results of operation for the six month periods ended June 30, 1998
and 1997, and for the fiscal years ended December 31, 1997, 1996, and 1995.
First American's



                                      60
<PAGE>   64



financial statements and accompanying notes which follow are an integral part
of this review and should be read in conjunction with it.

         First American conducts a general commercial banking business in
Indian River County, Florida and in the surrounding areas. The business
consists primarily of attracting deposits from the general public and applying
those funds for the origination of loans for commercial, consumer, and
residential purposes. First American's profitability depends primarily on net
interest income which is the difference between interest income generated from
interest earning assets (i.e., loans and investments) less interest expenses
incurred on interest bearing liabilities (i.e., customer and borrowed funds).
Net interest income is affected by the relative amounts of interest earning
assets, interest bearing liabilities and the interest rates paid on these
balances.

         Net interest income is dependent upon First American's interest rate
spread, which is the difference between the average yield earned on interest
earning assets and the average rate paid on interest bearing liabilities. When
the interest that is generated on interest earning assets exceeds the interest
that is paid on interest bearing liabilities, First American generates a
positive interest rate spread (net rate of yield). During 1997 First American's
yield on net average earning assets was 5.41%, and for the six month period
ending June 30, 1998 First American's yield on net average earning assets was
4.99%. During 1996 and 1995, First American's yield on net average earning
assets was 5.01% and 4.66%, respectively. The net yield is impacted by interest
rates, deposit flows, and loan demand.

         In addition, First American's profitability is affected by such
factors as the level of non-interest income and expenses, the provision for
loan losses, and the effective tax rate. Non-interest income consists primarily
of service charges and other deposit fees, and also fees raised from mortgage
origination activities. Non-interest expense consists primarily of compensation
and benefits, occupancy related expenses, and other operating expenses.

         Since the commencement of banking operations in November 1984, First
American's total assets have grown to $45,384,501 million as of June 30, 1998.
To augment it's normal growth and to achieve greater market share, First
American established a branch facility which opened on May 20, 1996. The branch
has contributed to the growth of First American, and as of September 30, 1998,
First American's branch facility accounts for 21.37% of First American's total
deposits. First American has continued to sustain its growth while maintaining
a strong capital position through the generation and retention of profits.


RESULTS OF OPERATIONS

         Comparison of Six Months Ended June 30, 1998 and 1997

         For the six month period ended June 30, 1998, First American reported
net income of approximately $195,012, or $1.51 per outstanding share of stock,
as compared to a net income of $175,651 or $1.38 per outstanding share of stock
for the six month period ended June 30, 1997, which is an increase of $19,361.
Basic net income for the six month period ended June 30, 1998, was greater than
the six month period ended June 30, 1997, primarily due to the progress of the
branch bank facility and the progressive improvement of the branch's
contribution to earnings. Total assets as of June 30, 1998, were approximately
$45,384,501 which is an increase of $3,293,590 or 8% over June 30, 1997. Net
interest earnings increased to approximately $1,021,976 as of June 30, 1998,
which is an increase of approximately $26,650 or 3% over June 30, 1997.

         Total non-interest income for the six month period ended June 30, 1998
was approximately $130,769 as compared to total non-interest income of
approximately $97,918 for the six month period ended June 30, 1997, an increase
of $32,851 or 34%. Total other operating expenses were $782,733 for the six
month period ended June 30, 1998, as compared to $774,493 for the six months
period ended June 30, 1997, an increase of $8,240 or 1%.



                                      61
<PAGE>   65



         First American's loans totaled approximately $30,409,798 at June 30,
1998, an increase of $1,005,829 or 3% over June 30, 1997. The allowance for
loan losses was $300,577 or 1% of total outstanding loans at June 30, 1998,
which is up from $276,073 or .95% of total loans at June 30, 1997.

         First American's yield on net average earning assets during the six
month period ended June 30, 1998, was 4.99%, which compared to a yield on net
average earnings of 5.27% during the same period of 1997.

         Comparison of the Fiscal Years Ended December 31, 1997 and 1996

         For the year ended December 31, 1997, First American reported net
income of $350,546 or $2.74 per share of outstanding stock, as compared to net
income of $234,736 or $1.87 per outstanding share of stock for the year ended
December 31, 1996. A 10% stock dividend was issued by First American on June
20, 1997. The 1997 income increased from 1996, notwithstanding the fact that
the branch bank facility established by First American on May 20, 1996, had not
yet reached the level of profitability.

         Net interest income before provision for loan losses for the year
ended December 31, 1997, was approximately $2,016,829 or 5.41% of average net
earning assets, as compared to $1,709,083 or 5.01% of average net earning
assets for the year ended December 31, 1996. The increase in net interest
income from 1996 to 1997 was due primarily to an increase in net earning
assets.

         First American's total assets were approximately $44,294,904 and
$39,073,509 at December 31, 1997, and December 31, 1996, respectively. Total
assets increased approximately $5,221,395 or 13.4% from December 31, 1996, to
December 31, 1997. First American's earning assets were approximately
$40,309,453 at December 31, 1997, representing an increase of $5,156,829, or
14.7%, from December 31, 1996.

         First American's loans totaled approximately $29,936,707 at December
31, 1997, an increase of $2,641,198 or 9.7% from December 31, 1996. The
allowance for loan losses was $283,230 or .95% of total outstanding loans at
December 31, 1997. This compares to allowance for loan losses of $268,375 or
 .98% of total outstanding loans as of December 31, 1996.


         Comparison of Fiscal Years Ended December 31, 1996 and 1995

         For the year ended December 31, 1996, First American reported net
income of $234,736 or $1.87 per outstanding share as compared to net income of
$360,025 or $2.90 per outstanding share for the year ended December 31, 1995.
The 1996 net income was a decrease of $125,289 from 1995. The decrease resulted
from the expenses incurred in establishing and supplementing First American's
first branch office.

         Net interest income before provision of loan losses for the year ended
December 31, 1996, was approximately $1,709,083 or 5.01% of average net earning
assets, as compared to $1,668,285 or 5.33% of average net earning assets for
the year ended December 31, 1995. The increase in net interest income from 1995
to 1996 was due primarily to an increase in net earning assets. First
American's total assets were approximately $39,073,509 and $35,627,613 at
December 31, 1996 and 1995 respectively. Total assets increased approximately
$3,445,896 or 9.7% from December 31, 1995, to December 31, 1996. First
American's earning assets were approximately $35,152,624 at December 31, 1996,
which represents an increase of $2,742,343 or 8.5% from December 31, 1995.

         First American's loans totaled approximately $27,295,509 at December
31, 1996, which is an increase of $3,766,454 or 16% from December 31, 1995. The
allowance for loan losses was $268,375 or .98% of total outstanding loans as of
December 31, 1996. This compares to an allowance for loan losses of $222,138 or
 .94% of total loans at December 31, 1995.



                                      62
<PAGE>   66



NET INTEREST INCOME

         Net interest income, which constitutes the principal source of income
for First American, represents the difference between interest income on
interest earning assets and interest expense on interest bearing liabilities.
The primary interest earning assets of First American are loans made to
businesses and individuals. Interest bearing liabilities consist primarily of
time deposits, interest bearing checking accounts ("NOW accounts"), savings
deposits, money market deposits, and individual retirement accounts. Funds
generated by these sources are invested in interest bearing assets accordingly.
Net interest income depends on the volume of average interest earning assets
and average interest bearing liabilities, and the interest rates earned and
paid on interest earning assets and interest bearing liabilities.

         Net interest income for the six months ended June 30, 1998 and 1997
was approximately $1,021,976 and $995,326 respectively, and the yield on net
average interest earning assets was 4.99% and 5.27%, respectively.

         Net interest income for the years ended December 31, 1997, 1996 and
1995 was approximately $2,016,289, $1,709,083, and $1,668,285, respectively.
The yield on net average earning assets was 5.41%, 5.01%, and 4.66%
respectively. Total interest expense for the years ended December 31, 1997,
1996 and 1995 was approximately $1,342,543, $1,301,787, and $1,196,859,
respectively. The average cost of interest bearing liabilities for each period
was 4.64%, 5.16%, and 4.86%, respectively.



                                      63
<PAGE>   67



           COMPARATIVE AVERAGE BALANCES, INTEREST, AND AVERAGE YIELDS

<TABLE>
<CAPTION>
                                                       (DOLLARS IN THOUSANDS)

                                                       Six Months Ended June 30,                   
                                                       -------------------------                   
                                                   1998                              1997          
                                      ----------------------------      -------------------------- 
                                                Interest                          Interest         
                                      Average   Income/     Yield/      Average   Income/   Yield/ 
                                      Balance   Expense      Rate       Balance   Expense     Rate 
                                      -------   -------     ------      -------   --------  -------
<S>                                   <C>       <C>         <C>        <C>        <C>       <C>    
Interest earning assets:
  Loans receivable, net               $ 29,745  $ 1,443      9.70%     $ 28,277   $ 1,387     9.81%
  Investment securities, taxable         5,960      184      6.17%        7,306       223     6.10%
  Investment securities nontaxable         -0-      -0-       -0-%          -0-       -0-      -0-%
  Federal funds sold                     5,219      142      5.44%        2,177        57     5.24%
                                      --------  -------     -----      --------   -------   ------ 
    Total interest earning assets       40,924    1,769      8.65%       37,760     1,667     8.82%

Non-interest earning assets:
  Cash and due from banks                2,463                            2,177                    
  Other assets                           1,741                            2,146                    
                                      --------                         --------                    
    Total non-interest earning assets    4,204                            4,323                    
                                      --------                         --------                    

      Total assets                    $ 45,128                         $ 42,083                    
                                      ========                         ========                    

Interest bearing liabilities:
Deposits
  Interest bearing demand and
    NOW deposits                      $    766  $     5      1.31%     $    869   $     6     1.38%
  Savings deposits                       1,877       21      2.24%        1,739        19     2.19%
  Money market deposits                  4,042       46      2.28%        4,910        59     2.40%
  Time deposits                         24,550      674      5.49%       21,897       588     5.37%
  Repurchase agreements                    -0-      -0-       -0-%          -0-       -0-      -0-%
                                      --------  -------    ------      --------   -------   ------ 
    Total interest bearing liabilities  31,235      747      4.78%       29,415       672     4.56%

Non-interest bearing liabilities:
  Non-interest bearing deposits          8,869                            7,898                    
  Other liabilities                        -0-                              -0-                    
    Total non-interest bearing           8,869                            7,898                    
      liabilities                          261                              465                    
                                      --------                         --------                    
      Total liabilities                  9,130                            8,363                    
                                      ========                         ========                    
Stockholder's equity                     4,763                            4,305                    
                                      --------                         --------                    
    Total liabilities and
      stockholder's equity            $ 45,128                         $ 42,083                    
                                      ========                         ========                    
    Net interest income               $  1,022                         $    995                    
                                      ========                         ========                    
    Net yield on average earning assets                    4.99%                              5.27%
                                                           ====                             ====== 
</TABLE>


<TABLE>
<CAPTION>

                                                                   Years Ended December 31,
                                                                   ------------------------
                                                            1997                                 1996           
                                                   --------------------            -----------------------------
                                                          Interest                           Interest
                                              Average     Income/    Yield/        Average   Income/    Yield/
                                              Balance     Expense     Rate         Balance   Expense     Rate  
                                              -------     -------    -------       -------   -------    -------
<S>                                          <C>          <C>        <C>          <C>        <C>        <C>
Interest earning assets:
  Loans receivable, net                      $ 28,982     $ 2,863       9.83%     $ 23,798   $ 2,413      10.14%
  Investment securities, taxable                6,376         392       6.14%        6,643       404       6.02%
  Investment securities nontaxable                -0-         -0-        -0-%          -0-       -0-        -0-%
  Federal funds sold                            1,941         104       5.15%        3,683       194       5.26%
                                             --------     -------    -------      --------   -------    -------
    Total interest earning assets              37,299       3,359       9.00%       34,124     3,011       8.82%

Non-interest earning assets:
  Cash and due from banks                       2,329                                1,903
  Other assets                                  2,080                                1,918
                                             --------                             --------
    Total non-interest earning assets           4,409                                3,821
                                             --------                             --------

      Total assets                           $ 41,708                             $ 37,945
                                             ========                             ========

Interest bearing liabilities:
Deposits
  Interest bearing demand and
    NOW deposits                             $    869     $    12        1.36%    $    963   $    14       1.45%
  Savings deposits                              1,780          39        2.24%       1,447        33       2.28%
  Money market deposits                         4,440         106        2.38%       4,038       100       2.48%
  Time deposits                                21,836       1,185        5.43%      18,791     1,155       6.14%
  Repurchase agreements                           -0-         -0-         -0-%         -0-       -0-        -0-%
                                             --------     -------    --------     --------   -------    -------
    Total interest bearing liabilities         28,925       1,342        4.64%      25,239     1,302       5.16%

Non-interest bearing liabilities:
  Non-interest bearing deposits                 7,785                                8,257
  Other liabilities                               -0-                                  -0-
    Total non-interest bearing                  7,785                                8,257
      liabilities                                 500                                  247
                                             --------                             --------
      Total liabilities                         8,285                                8,504
                                             ========                             ========
Stockholder's equity                            4,498                                4,202
                                             --------                             --------
    Total liabilities and
      stockholder's equity                   $ 41,708                             $ 37,945
                                             ========                             ========
    Net interest income                      $  2,017                             $  1,709
                                             ========                             ========
    Net yield on average earning assets                                  5.41%                              5.01%
                                                                     ========                           ========
</TABLE>


                                      64

<PAGE>   68



         The effect on interest income, interest expense, and net interest
income for the periods indicated, of changes in average balance and rate, is
shown below. The effect of a change in average balance has been determined by
applying the average rate at the year-end for the earlier period to the change
in average balance at the year-end for the later period. Changes resulting from
average balance/rate variances are included in changes resulting from volume.

                       RATE/VOLUME ANALYSIS OF NET INCOME

         The following table sets forth the extent to which changes in volume
and rates of earning assets and interest-bearing liabilities affected change in
interest income or interest expense in the indicated time periods. For each
major balance sheet category, information is provided relating to (1) changes
in volume (changes in average balance multiplied by the prior year's average
interest rate), (2) changes in rate (changes in average interest rate
multiplied by the prior year's average balance), and (3) the total change in
interest income/expense. Changes attributable jointly to volume and rate have
been allocated proportionately.

<TABLE>
<CAPTION>
                                                  Six Months Ended                Year Ended                     Year Ended
                                                      June 30,                   December 31,                   December 31,
                                               1998 Compared to 1997         1997 Compared to 1996          1996 Compared to 1995
                                              --------------------------   --------------------------    --------------------------
                                              Increase (Decrease) Due to   Increase (Decrease) Due to    Increase (Decrease) Due to
                                              --------------------------   --------------------------    --------------------------
                                              Average   Average   Total    Average    Average   Total     Average   Average   Total
                                              Volume     Rate     Change    Volume     Rate     Change    Volume     Rate     Change
                                              -------   -------   ------   -------    -------   ------    -------   -------   ------
                                                                               (Dollars in Thousands)
<S>                                           <C>       <C>       <C>      <C>        <C>       <C>       <C>       <C>       <C>
Interest earned on:
   Loans receivable, net                       $  73     $(17)    $  56     $ 510     $ (60)    $ 450     $  40     $ (19)    $  21
   Investment securities, taxable                (41)       2       (39)      (18)        6       (12)      141         2       143
   Investment securities, non-taxable              0        0         0         0         0         0         0         0         0
   Federal funds sold                             80        5        85       (93)        3       (90)        3       (21)      (18)
                                               -----     ----     -----     -----     -----     -----     -----     -----     -----
      Total interest income                      112      (10)      102       399       (51)      348       184       (38)      146

Interest paid on:
   Interest bearing demand and
      NOW deposits                             $  (1)    $  0     $  (1)    $  (3)    $   1     $  (2)    $  (1)    $  (5)    $  (6)
   Savings deposits                                1        1         2         7        (1)        6         2         1         3
   Money market deposits                         (10)      (2)      (12)        9        (3)        6        (9)      (11)      (20)
   Time deposits                                  73       13        86       174      (144)       30        44        84       128
                                               -----     ----     -----     -----     -----     -----     -----     -----     -----
   Repurchase agreements                           0        0         0         0         0         0         0         0         0
                                               -----     ----     -----     -----     -----     -----     -----     -----     -----
      Total interest expense                      63       12        75       187      (147)       40        36        69       105
                                               -----     ----     -----     -----     -----     -----     -----     -----     -----
      Change in interest income                $  49     $(22)    $  27     $ 212     $  96     $ 308     $ 148     $(107)    $  41
                                               =====     ====     =====     =====     =====     =====     =====     =====     =====
</TABLE>


PROVISION FOR LOAN LOSSES

         First American recorded a provision for loan losses of $65,000 during
the six month period ended June 30, 1998 as compared to $32,500 for the six
month period ended June 30, 1997. For the year ended December 31, 1997, First
American recorded a provision for loan losses of $107,500 as compared to
$32,388 for the year ended December 31, 1996. First American recorded a
provision for loan losses in the amount of $33,535 for the year ended December
31, 1995.

         The total allowance for loan losses was $283,230 or .95% of total
outstanding loans at December 31, 1997 as compared to $268,375 or .98% of total
outstanding loans at December 31, 1996. The total allowance for loan losses was
$222,138, or .94% at December 31, 1995.



                                      65
<PAGE>   69



         First American's policy is to record a provision for loan losses
consistent with current levels of net charge-offs, loan growth, aggregate
credit quality trends (including an assessment of existing levels of classified
criticized assets) and current economic conditions.

         First American's allowance for loan losses represents an amount which,
in the judgment of management and First American's Board of Directors, will be
adequate to absorb losses on existing loans that may become uncollectible. The
adequacy of the allowance for loan losses is evaluated monthly based on a
regular review of First American's loan portfolio, non accruing loans, past due
loans, and other loans that management and First American's Board of Directors
believes to require special attention.


NON-INTEREST INCOME

         First American's's non-interest income includes service charges and
other fees on deposit accounts, fees from mortgage origination activities, and
other miscellaneous fee income. For the six month periods ended June 30, 1998
and 1997, non-interest income was approximately $130,769 and $97,918,
respectively.

         Non-interest income totaled approximately $225,041, $160,419 and
$148,095 for the years ended December 31, 1997, 1996, and 1995 respectively. Of
the $64,622 increase in non-interest income from 1996 to 1997, approximately
56% of the increase was attributed to service charges on deposit accounts.


         The following table compares the various categories of non-interest
income for the periods indicated.

                                                NON-INTEREST INCOME

<TABLE>
<CAPTION>
                                            Six Months Ended June 30,                 Years Ended December 31,
                                            -------------------------                 ------------------------
                                             1998              1997                      1997           1996
                                             ----              ----                      ----           ----
<S>                                        <C>              <C>                       <C>           <C>
                                             (Dollars in Thousands)
Service Charge and other fees              $ 81,265         $ 75,888                  $ 160,996      $ 125,050
Miscellaneous income                         49,504           22,030                     65,842         34,431
Securities gain (loss), net                       0                0                     (1,797)           938
                                           --------         --------                  ---------      ---------
     Total non-interest income             $130,769         $ 97,918                  $ 225,041      $ 160,419
                                           ========         ========                  =========      =========
</TABLE>


NON-INTEREST EXPENSE

         Non-interest expense for the six months ended June 30, 1998 and 1997
totaled $782,733 and $774,493, respectively.

         Non-interest expense for the years ended December 31, 1997, 1996, and
1995 totaled approximately $1,586,441, $1,455,778, and $1,246,890,
respectively. The increase in non-interest expenses of $130,663 from 1996 to
1997 was primarily due to the establishment of First American's first branch
bank facility.

         The increase in non-interest expense from 1995 to 1996 of $208,888 was
due primarily to the addition of personnel to service the broadening of First
American's customer base and its demands.



                                      66
<PAGE>   70



         The following table summarizes the various categories of non-interest
expense for periods indicated.

                                               NON-INTEREST EXPENSE
<TABLE>
<CAPTION>

                                             Six Months Ended June 30,                Years Ended December 31,
                                             -------------------------                ------------------------
                                             1998               1997                    1997            1996
                                             ----               ----                    ----            ----
<S>                                       <C>                <C>                    <C>             <C>
Salaries and employee benefits            $ 381,543          $ 375,644              $  801,215      $  721,230
Occupancy expense                            75,263             70,300                 139,647          63,982
Marketing and advertising                    16,759             17,779                  41,493          36,922
Data processing fees                         67,608             62,528                 124,464         105,852
Furniture and equipment                      34,235             43,315                  82,064          76,874
FDIC premiums                                 2,193              1,089                   3,538           2,000
Professional fees                            10,250             21,364                  40,990          40,518
Printing, stationery and supplies            30,279             31,776                  60,026          61,706
Director fees and expenses                   41,900             41,900                  82,650          82,550
Postage                                      18,818             17,549                  35,792          31,331
Other expenses                              103,885             91,249                 174,562         232,813
                                          ---------          ---------              ----------      ----------
     Total non-interest expense           $ 782,733          $ 774,493              $1,586,441      $1,455,778
                                          =========          =========              ==========      ========== 
</TABLE>


INCOME TAXES

         For the six month periods ended June 30, 1998 and 1997, First
American's provision for income taxes was approximately $110,000 and $110,600,
respectively. For the years ended December 31, 1997, 1996, and 1995, First
American's provision for income taxes was approximately $197,382, $146,600, and
$175,930, respectively. The increases from 1996 to 1997 and from 1995 to 1996
were due to increased earnings before taxes.


ASSET/LIABILITY MANAGEMENT

         First American seeks to maximize net interest income through growth in
net earning assets and by protecting First American's net interest margin and
ensuring adequate liquidity for growth in deposit flows. First American
accomplishes this by structuring the balance sheet so that repricing
opportunities exist for both assets and liabilities during approximately the
same time intervals in the future. First American's management and Board of
Directors recognize that a perfectly matched interest rate sensitive balance
sheet is not possible and that imbalances in repricing opportunities at any
point in time constitutes First American's interest sensitivity position.

         First American's management attempts to manage these imbalances to
provide for a consistently growing positive net interest rate margin under all
interest rate environments. To this end, First American's management and First
American's Asset and Liability Committee monitors the structure of First
American's rate-sensitive assets and liabilities. As an additional measure,
First American's management generally restricts the maturities of its fixed
interest rate loans to a maximum of five years in order to create repricing
opportunities. First American also restricts the maturities of the securities
of First American's investment portfolio to a maximum of five years.

         A traditional indicator of the interest rate sensitivity position of a
financial institution's balance sheet is the difference between rate sensitive
assets and rate sensitive liabilities at given forward-looking time horizons,
which is referred to as First American's "GAP" measurement. GAP analysis is a
traditional indicator used for monitoring interest rate risk and First American
employs GAP analysis as one of the means of monitoring First American's
exposure to the risk of interest rate sensitivity. Management believes that
First American was not subject to any excessive interest rate risk at June 30,
1998.



                                      67
<PAGE>   71



             INTEREST RATE SENSITIVITY ANALYSIS AS OF JUNE 30, 1998

                             (Dollars in Thousands)

                               TERM TO REPRICING

<TABLE>
<CAPTION>
                                                90 Days                  91 Days                   More Than
                                                or Less                 to 1 Year                    1 Year                   Total
                                                -------                 ---------                    ------                   -----
<S>                                          <C>                      <C>                        <C>                     <C>
Interest-earning assets
    Federal funds sold                       $    5,275               $         0                $         0             $     5,275
    Investment securities, taxable                    0                       500                      5,559                   6,059
    Loans, net                                    8,742                     2,440                     19,227                  30,409
                                             ----------               -----------                -----------             -----------
        Total interest-earning assets        $   14,017               $     2,940                $    24,786             $    41,743
                                             ==========               ===========                ===========             ===========

Interest-bearing liabilities:
    NOW & savings accounts                   $    2,568               $         0                $         0             $     2,568
    Money market deposit                          4,567                         0                          0                   4,567
    Time & IRA time deposit                       5,312                     6,063                     13,618                  24,993
                                             ----------               -----------                -----------             -----------

Total interest-bearing liabilities           $   12,447               $     6,063                $    13,618             $    32,128
                                             ==========               ===========                ===========             ===========

Interest sensitivity gap period              $    1,570               $    (3,123)               $    11,168             $     9,615
                                             ==========               ===========                ===========             ===========

Cumulative gap                               $    1,570               $    (1,553)               $     9,615
                                             ==========               ===========                ===========

Cumulative ratio of interest-earning
    assets to interest-bearing liabilities       112.61%                    48.49%                    182.01%

Cumulative gap to total assets                     3.46%                    -3.42%                     21.19%
</TABLE>



                                      68
<PAGE>   72



           INTEREST RATE SENSITIVITY ANALYSIS AS OF DECEMBER 31, 1997

                             (Dollars in Thousands)

                               TERM TO REPRICING

<TABLE>
<CAPTION>
                                                90 Days                 91 Days                   More Than
                                                or Less                to 1 Year                    1 Year                   Total
                                                -------                ---------                    ------                   -----
<S>                                          <C>                      <C>                       <C>                     <C>
Interest-earning assets
    Federal funds sold                       $    4,825               $        0                $         0             $     4,825
    Investment securities, taxable                  993                      500                      4,055                   5,548
    Loans, net                                    9,728                    2,019                     18,190                  29,937
                                             ----------               ----------                -----------             -----------
        Total interest-earning assets        $   15,546               $    2,519                $    22,245             $    40,310
                                             ==========               ==========                ===========             ===========

Interest-bearing liabilities:
    NOW & savings accounts                   $    2,620               $        0                $         0             $     2,620
    Money market deposit                          4,252                        0                          0                   4,252
    Time & IRA time deposit                       6,481                   12,613                      5,239                  24,333
                                             ----------               ----------                -----------             -----------

Total interest-bearing liabilities           $   13,353               $   12,613                $     5,239             $    31,205
                                             ==========               ==========                ===========             ===========

Interest sensitivity gap period              $    2,193               $  (10,094)               $    17,006             $     9,105
                                             ==========               ==========                ===========             ===========

Cumulative gap                               $    2,193               $   (7,901)               $     9,105
                                             ==========               ==========                ===========

Cumulative ratio of interest-earning
    assets to interest-bearing liabilities      116.42%                    19.97%                    424.60%

Cumulative gap to total assets                    4.95%                   -17.84%                     20.56%
</TABLE>



                                      69
<PAGE>   73



FINANCIAL CONDITION:

LENDING ACTIVITIES

    The primary source of income for First American is the interest earned on
loans. Loans are the single largest component of First American's earning
assets, as well as the highest yielding component. Due to the importance of
loans to First American's profitability, most other assets and liabilities are
managed to accommodate the funding of loans.

    At June 30, 1998, First American's total assets were approximately
$45,384,501 as compared to $42,090,911 at June 30, 1997. At December 31, 1997,
total assets were approximately $44,294,904 as compared to $39,073,509 at
December 31, 1996. At June 30, 1998, total loans were approximately $30,409,798
or 67% of total assets, as compared to total loans of $29,403,969 or 70% of
total assets at June 30, 1997. At December 31, 1997, total loans were
$29,936,707 or 68% of total assets as compared to total loans of $29,403,969 or
70% of total assets at June 30, 1997. At December 31, 1997, total loans were
$29,936,707 or 68% of total assets as compared to total loans of $27,295,509 or
70% of total assets at December 31, 1996, and $23,529,055 or 66% of total
assets at December 31, 1995. Management believes that the increase in loans
from 1995 to 1997 is primarily attributable to a continued, strong local and
regional economy, and a relatively stable interest rate environment, as well as
the favorable reputation First American enjoys among small businesses and
professionals in First American's primary market area.

    The following table summarized the composition of First American's loan
portfolio by type of loan on the dates indicated.

                           LOAN PORTFOLIO COMPOSITION

                             (Dollars in Thousands)

<TABLE>
<CAPTION>
                                        Six Months Ended                       Years Ended December 31,
                                        ----------------                       ------------------------
                                          June 30, 1998                        1997                1996
                                          -------------                        ----                ----

                                          Amount           %          Amount         %         Amount          %
                                          ------          --          ------        --         ------         --
<S>                                       <C>          <C>            <C>        <C>          <C>         <C>
Type of loan:
  Commercial and financial                 $ 3,967         13%        $ 4,466        15%      $ 4,752        17%
  Real estate construction                     808         02%            932        03%          305        01%
  Real estate mortgage                      18,717         62%         17,970        60%       17,384        64%
  Installment loans to individuals           6,918         23%          6,569        22%        4,854        18%
                                           -------     ------         -------    ------       -------     ------

       Total loans                         $30,410        100%        $29,937       100%      $27,295       100%
                                                       ======                    ======                   ======

Less:
  Unearned loan fees                            77                         71                      69
  Allowance for loan losses                    301                        283                     268
                                           -------                    -------                 -------

       Net loans                           $30,032                    $29,583                 $26,958
                                           =======                    =======                 ========
</TABLE>


  The following tables set forth the maturities of loans outstanding at
December 31, 1997, and an analysis of sensitivities of all loans due to changes
in interest rates.



                                      70
<PAGE>   74



                             LOAN MATURITY SCHEDULE

                             (DOLLARS IN THOUSANDS)


<TABLE>
<CAPTION>
                                                    At December 31, 1997
                                              ---------------------------------
                                                                   Due After 1
                                                Due in 1            Year But             Due After
                                              Year or Less       Before 5 Years           5 Years         Total
                                              ------------       --------------           -------       --------
<S>                                           <C>                <C>                      <C>           <C>
Residential
     Real Estate Loans                           $ 2,103              $ 7,728             $   468        $10,299

All Other Loans                                    9,660                9,493                 485         19,638
                                                 -------              -------             -------        -------
                                                 $11,763              $17,221             $   953        $29,937
                                                 =======              =======             =======        =======
</TABLE>


         The following table sets forth as of June 30, 1998, and December 31,
1997, the dollar amounts of loans due after one year which had predetermined
interest rates and which had floating or adjustable rates.

                             DOLLAR AMOUNT OF LOANS

                             (Dollars in Thousands)

<TABLE>
<CAPTION>
                                            June 30, 1998                         December 31, 1997
                                            -------------                         -----------------
<S>                                         <C>                                   <C>
Type of interest rate:
     Predetermined                              $19,227                                 $18,190
     Floating or adjustable                       4,817                                   4,722
                                                -------                                 -------

         Total                                  $24,044                                 $22,912
                                                =======                                 =======
</TABLE>


ASSET QUALITY

         Management has sought to maintain a high quality of assets and adhere
to sound underwriting and lending practices. An analysis of the loan portfolio
reveals a significant concentration of real estate related credits. At June 30,
1998, approximately 64% of total loans were secured by real estate. As of
December 31, 1997, approximately 63% of total loans were secured by real
estate. At December 31, 1996 and 1995, respectively, approximately 65% and 70%
of total loans were secured by real estate.

         As of June 30, 1998, First American was the owner of two parcels of
"other real estate owned". One parcel is a 69 acre citrus grove that is located
in St. Lucie County, Florida, and is carried on the books of First American at
a value of $247,132. First American has placed a sales listing for the real
estate. The other parcel of other real estate owned by First American is a
parcel of real estate that is zoned heavy commercial and is carried on the
books of First American at a value of $59,713. A sales listing has also been
placed for this parcel of other real estate owned.



                                      71
<PAGE>   75



         As a result of management's ongoing review of the loan portfolio,
loans are classified as non-accrual when it is not reasonable to expect
collection of interest under the original terms of the loan due to a
deterioration in the financial condition of the borrower. At June 30, 1998,
First American had one non-accrual loan totaling $32,692.

         Loan concentrations are defined as amounts of monies loaned to a
number of borrowers engaged in similar activities which would cause them to be
similarly impacted by economic and other conditions. First American constantly
evaluates these concentrations for the purpose of assessing needed adjustments
to First American's lending activities. Items that influence such adjustments
are changes in the economy, loan to deposit ratios, and industry trends. First
American has a target mix of 10% commercial loans, 65% real estate loans and
25% consumer loans for the purpose of further reducing risk resulting from
concentration of credit.

         First American's Board of Directors and management place great
emphasis on strong loan underwriting procedures. First American has a loan
review process the objective of which is to quickly identify and evaluate
corrective action that is needed for marginal or trouble loans. In addition to
the review of such loans by Bank management, all due and delinquent loans are
also reviewed on a monthly basis by First American's Board of Directors.


CLASSIFICATION OF ASSETS

         Interest on loans is accrued and credited to income based upon the
principal balance outstanding. Unless mitigating circumstances exist, it is the
policy of First American to discontinue the accrual of interest income and
classify a loan as non-accrual when principal or interest is 90 days past due,
or financial condition of the borrower has deteriorated, or when the principal
and interest is not likely to be paid in accordance with the terms of the
obligation. Loans are not returned to accrual status until principal and
interest payments are brought current. Interest that is accrued and unpaid at
the time a loan is placed on a non-accrual status is charged against income.
Subsequent payments received are applied to the outstanding principal until the
loan is removed from non-accrual status.

         Real estate acquired by First American as a result of foreclosure is
classified as "other real estate owned." The properties are recorded on the
date acquired at the lower of fair market value less estimated selling costs,
or First American's recorded investment in the related loan. If the fair market
value, after deducting the estimated selling closing costs of the acquired
property, is less than the recorded investment in the related loan, the
estimated loss is charged to the allowance for loan losses at that time. The
resulting carrying value established at the date of the foreclosure becomes the
new cost basis for subsequent accounting. After foreclosure, if the fair market
value less estimated selling costs of the property, becomes less than its cost,
the provision is charged to the provision for loan losses. Any costs related to
the developmental improvement of the property are capitalized, whereas those
costs relating to holding the property for sale are charged as expense.

         At December 31, 1997, 1996, and 1995, First American had $503,527,
$452,077, and $486,267, respectively, in other real estate owned. As of June
30, 1998, First American had $306,845 in other real estate owned.


ALLOWANCE FOR LOAN LOSSES

         In originating loans First American recognizes that credit losses will
be experienced and the risk of loss will depend largely on the type of loan
made, the credit worthiness of the borrower over the term of loan, and in case
of a collateralized loan the quality of the collateral of the loan as well as
changes in general economic conditions. It is management policy to maintain an
adequate allowance for loan losses based on, among other



                                      72
<PAGE>   76



things, First American's historical loss experience, evaluation of economic
conditions, and regular reviews of delinquencies and of the quality of the loan
portfolio.

         The allowance for loan losses has been established through charges to
earnings in the form of a provision for loan losses. Increases and decreases in
the allowance due to changes in the measurement of impaired loans are included
in the provision for loan losses. Loans continue to be classified as incurred
unless they have been brought fully current and the collection of scheduled
interest and principal is considered probable. When a loan or a portion of a
loan is determined to be uncollectible, the portion that is deemed to be
uncollectible is charged against the allowance.

         It is management's policy to discontinue the accrual of interest
income and classify a loan as non-accrual when principal or interest is 90 days
past due, the financial condition of the borrower deteriorates, or when
principal or interest is not likely to be paid in accordance with the terms of
the obligation. The exception to this policy is when the loan is a secured loan
and management has investigated the circumstances of the loan and has
reasonable cause to believe that the loan will be brought current from a
specific source of repayment.

         Management continues to actively monitor First American's asset
quality and to charge off loans against the allowance for loan losses when
appropriate, or to provide specific loan losses when necessary. Although
management believes it uses the best information available to make
determinations with respect to the allowance for loan losses, future
adjustments may be necessary if the economic conditions differ from the
economic conditions used as assumptions in making the initial determinations.

         First American's allowance for loan losses was $300,577 as of June 30,
1998 (.98% of total loans), and $283,230 at December 31, 1997 (.95% of total
loans). First American experienced charged-offs totaling $48,528 during the six
month period ended June 30, 1998. First American had no recoveries of
previously charged off loans during the six month period ended June 30, 1998.
First American experienced charge-offs totaling $98,878, $25,180, and $82,830
during the fiscal years ended December 31, 1997, 1996, and 1995, respectively.
During those same years First American had recoveries of previously charged-off
loans totaling $6,233, $39,029, and $1,320 respectively.

         At June 30, 1998 First American's allowance for loan losses was
comprised of a general loan portfolio allocation totaling $279,125, and a
specific allocation totaling $21,452. At June 30, 1998, First American's Board
of Directors determined that the allowance for loan losses was adequate.



                                      73
<PAGE>   77



         The following table sets forth an analysis of First American's
allowance for possible loan losses for the periods indicated.

                        SUMMARY OF LOAN LOSS EXPERIENCE

<TABLE>
<CAPTION>
                                                                             (Dollars in Thousands)
                                                                               SIX MONTHS ENDED                   YEARS ENDED
                                                                              ---------------------               -----------
                                                                                    JUNE 30,                      DECEMBER 31,
                                                                                    --------                      ------------
                                                                              1998            1997           1997            1996
                                                                              ----            ----           ----            ----
<S>                                                                          <C>            <C>           <C>             <C>
Total net loans outstanding at end of period                                 $30,032        $29,056       $ 29,583        $ 26,957
Average net loans outstanding during the year                                 29,745         28,277         28,982          23,798
Allowance for loan losses, beginning of period                                   283            268            268             222
Loans charged-off during the period:                                                                                              
           Commercial and financial                                               28             25             85              13
           Real estate mortgage                                                    3              0              0               0
           Real estate construction                                                0              0              0               0
           Installment loans to individuals                                       17              0             13              12
                                                                                                                          --------
                   Total loans charged-off                                        48             25             98              25
Recoveries of loans previously charged-off:                                                                                       
            Commercial and financial                                               0              0              6              29
            Real estate mortgage                                                   0              0              0               8
            Real estate construction                                               0              0              0               0
            Installment loans to individuals                                       1              0              0               2
                                                                             -------                                      --------
                   Total recoveries                                                1              0              6              39
Net loans charged-off (recoveries) during the                                                                                     
         period                                                                   47             25             92             (14)
Provisions for loan losses                                                        65             33            107              32
                                                                             -------        -------       --------        --------
Allowance for loan losses, end of period                                     $   301        $   276       $    283        $    268
                                                                             =======        =======       ========        ========
Non-performing loans, end of period                                               33              0              0             199
Net charge-offs (recoveries) during year to average                                            .002            .03            (.05)
         net loans
Allowance as a percentage of non-performing
            loans                                                              912.1%            --             --           134.7%
</TABLE>

INVESTMENT ACTIVITIES

         Management and the Board of Directors of First American have made it a
policy to classify virtually all investment securities purchased as "available
for sale." Securities in this category are to be held for indefinite periods of
time and not intended to be held until maturity. These securities could,
however, be held until maturity if management deems it to be advantageous to
First American.

         Assets included in this category are those assets that management
intends to use as a part of its overall assets/liability strategy, and that may
be sold in response to changes in interest rates, corresponding prepayment risk
changes, liquidity needs, and other factors related to management's
assets/liability strategy.

         Securities in this category are recorded at fair market value. Both
unrealized gains and losses on securities available for sale, net of taxes, are
included as separate components of stockholder's equity in the balance sheet
until the gains or losses are realized.

         The cost of investment securities sold is determined by the specific
identification method. If a security has a decline in fair market value that is
other than temporary then the security will be written down to its fair market
value by recording a loss in the statement of operations.

         As of June 30, 1998, management currently had $54,931 of securities
classified as "held to maturity," and no "trading" securities.

         At June 30, 1998, First American had an unrealized gain on securities
available for sale (net of taxes) of approximately $3,841. As of June 30, 1998,
First American's investment portfolio totaled approximately $6,059,197 compared
to $5,547,746 at December 31, 1997. At June 30, 1998, 95% ($5,751,000) of First
American's investment portfolio consisted of U.S. Government Agency securities
and 5% ($308,197) of the portfolio consisted of high grade corporate securities.



                                      74
<PAGE>   78



         The following table summarizes the carrying value of First American's
investment portfolio as of the dates indicated.

                        INVESTMENT SECURITIES PORTFOLIO

                             (Dollars in Thousands)

<TABLE>
<CAPTION>
                                                            At June 30,              At December 31,
                                                               1998              1997            1996
                                                            -----------        ---------       ---------
<S>                                                         <C>                <C>             <C>
Investment securities, available for sale:
   U.S. treasury securities                                 $         0        $     500       $   1,246
   U.S. government agencies                                       5,751            4,743           4,960
   Corporate debt securities                                        253              250             800
                                                            -----------        ---------       ---------
     Total investment securities, available for sale        $     6,004        $   5,493       $   7,006
                                                            ===========        =========       =========

Investment securities, held to maturity:
   U.S. treasury securities                                 $         0        $       0       $       0
   U.S. government agencies                                           0                0               0
   Primarily Federal Reserve Stock                                   55               55              50
                                                            -----------        ---------       ---------
     Total investment securities, held to maturity          $        55        $      55       $      50
                                                            ===========        =========       =========

   Total                                                    $     6,059        $   5,548       $   7,056
                                                            ===========        =========       =========
</TABLE>


         The following table sets forth the weighted average yield of the
investment portfolio of First American as of June 30, 1998. The calculation of
the weighted average interest yields is based on yield, weighted by the
respective costs of the securities.

                    INVESTMENT CATEGORY AS OF JUNE 30, 1998

                             (Dollars in Thousands)

<TABLE>
<CAPTION>
                                                                                               Average
                                                                     Amount                     Yield
                                                                ---------------            ---------------
<S>                                                             <C>                        <C>

Investment Category:
Securities available for sale:
     0-1 year                                                       $  253                      6.15%
     1-5 years                                                       5,751                      6.19%
                                                                    ------                      ----
           Total                                                    $6,004                      6.18%
                                                                    ------                      ----

Securities held to maturity:
     0-1 year                                                           55                      6.00%
     1-5 years                                                           0                         0
    5-10 years                                                           0                         0
                                                                   -------                      ----
           Total                                                        55                      6.00%
                                                                   =======                      ====

Total investment securities                                        $ 6,059                      6.17%
                                                                   =======                      ====
</TABLE>


DEPOSIT ACTIVITIES

         Deposits are the primary source of funds for First American's lending
and other investment activities. In addition to deposits, First American
derives funds from interest payments, loan principal payments, and funds
provided from operations. Scheduled loan repayments are a relatively stable
source of funds, while deposit inflows and outflows are influenced by
competitive and general market interest rates, overall economic growth, and
activity in First American's market area. First American also has federal funds
purchase lines available from two correspondent banks for short term borrowing
needs. First American has never experienced the need to use the federal funds
purchase borrowing lines of credit.



                                      75
<PAGE>   79



         First American attracts deposits from within its principal market area
through the offering of a full line of deposit products. Deposit products
include checking accounts, money market accounts, savings accounts, regular
time deposits, and individual retirement savings plans.

         First American does not generally accept deposits from areas outside
its local geographic market and has not aggressively pursued large denomination
or high interest bearing certificates of deposit outside of First American's
local market area. As of June 30, 1998, First American had $5,969,000 in time
deposits with balances of $100,000 or more. As of December 31, 1997, 1996, and
1995, First American had time deposits in excess of $100,000 totaling
$4,684,419, $3,948,787 and $4,115,306, respectively.

         First American establishes maturity terms, service fees, and
withdrawal penalties on a periodic basis. The determination of interest rates
and terms is dependant upon funds acquisition and liquidity needs, interest
rates paid by competitors, growth goals, loan demand and federal regulations.

         The following table sets forth the average balances and average
weighted rates for First American's categories of deposits for the periods
indicated.

                                    DEPOSITS

                             (DOLLARS IN THOUSANDS)

<TABLE>
<CAPTION>
                                       Six Months Ended June 30,                  Fiscal Year Ended December 31,
                                                  1998                        1997                               1996
                                       ------------------------------  -----------------------------   -----------------------------
                                       Average   Average   % of Total  Average  Average   % of Total   Average  Average   % of Total
                                       Balance   Rate      Deposits    Balance  Rate      Deposits     Balance  Rate      Deposits
                                       -------   -------   ----------  -------  -------   ----------   -------  -------   ----------
                                                                                                                
<S>                                    <C>       <C>       <C>         <C>      <C>       <C>          <C>      <C>       <C>
Non-interest bearing demand
       deposits                        $ 8,869        --%       22.11% $ 7,785       --%       21.21%   $8,257       --%    24.65%
Interest bearing demand and
      NOW deposits                         766      1.31%        1.91%     869     1.36%        2.37%      963     1.45%     2.87%
Savings account deposits                 1,877      2.24%        4.68%   1,780     2.24%        4.85%    1,447     2.23%     4.32%
Money market accounts
      deposits                           4,042      2.28%       10.08%   4,440     2.38%       12.09%    4,038     2.48%    12.06%
Time deposits                           24,550      5.49%       61.22%  21,836     5.43%       59.48%   18,791     6.14%    56.10%
                                       -------                  -----  -------     ----       ------   -------     ----     -----
      Total                            $40,104                    100% $36,710                   100%  $33,496                100%
                                       =======      ----        =====  =======     ----       ======   =======     ----     =====
Weighted Average Rate (All Deposits)                3.73%                          3.66%                           3.89%
                                                    ====                           ====                            ====
</TABLE>


         The following table indicates the amount of First American's
certificates of deposit of $100,000 or more by time remaining until maturity at
June 30, 1998.

<TABLE>
<CAPTION>
                                                                             Certificates of
                                                                         $100,000 or greater
                                                                       (Dollars in Thousands)
Maturity Period As of June 30, 1998
        <S>                                                                     <C>
        Under three months                                                      $2,119
        Over three months through twelve months                                  3,017
        Over twelve months                                                         833
                                                                                ------
                Totals                                                          $5,969
                                                                                ======
</TABLE>




                                      76
<PAGE>   80




RETURN ON EQUITY AND ASSETS

         The following table sets forth First American's performance ratios for
the periods indicated.

<TABLE>
<CAPTION>
                                                                                        At December 31,
                                                                                   --------------------------
                                                                                   1997                  1996
                                                                                   ----                  ----
<S>                                                                                <C>                  <C>
Return on average assets                                                            .84                   .62
Return on average equity                                                           7.79                  5.59
Dividend payout ratio                                                               N/A                   N/A
Year-end equity to year-end total assets                                          10.48                 10.78
Average interest-earning assets to average interest bearing liabilities            1.29                  1.35
Non-performing loans and other real estate owned to average total assets           1.20                  1.72
Non-performing loans to total loans                                                 .00                   .07
Allowance for loan losses to total loans                                            .95                   .98
Net charge-offs (Recoveries)  to average net loans                                  .03                  (.05)
</TABLE>


LIQUIDITY AND CAPITAL RESOURCES

         First American's principal sources of funds are deposits, principal
and interest payments on loans, interest on investments, and sales of
investment securities. During 1997, First American experienced deposit growth
of $4.8 million, or 14%. Management is unaware of any trends in the sources or
uses of funds by First American that are expected to have a material adverse
impact on First American's liquidity position. First American believes it
maintains significant sources of secondary liquidity in case events occur that
would cause a material change in the liquidity position of First American.
First American maintains two overnight federal fund purchase lines of credit
with correspondent banks. First American also meets the definition of a "well
capitalized" financial institution.

         At June 30, 1998, shareholder equity was approximately $4,842,966 or
10.6% of total assets compared to $4,640,326 or 10.5% of total assets as of
December 31, 1997. At June 30, 1998, and December 31, 1997, respectively, First
American's Tier I risk base capital ratios were approximately 16.99% and
15.98%. All of First American's capital ratios are in excess of the regulatory
guidelines for a "well capitalized" bank.


IMPACT OF INFLATION AND CHANGING PRICES

         First American's financial statements have been prepared in accordance
with generally accepted accounting principles which require the measurement of
financial position and operating results in terms of historical dollars without
considering changes in the relative purchasing power of money over time due to
inflation. The primary impact of inflation on the operations of First American
is reflected in increased operating cost. Unlike most industrial companies,
virtually all of the assets and liabilities of a financial institution are
monetary in nature. Consequently, changes in interest rates have a more
significant impact on the performance of a financial institution than do the
effects of changes in the general rate of inflation and changes in prices.
Interest rates do not necessarily move in the same direction or in the same
magnitude as the prices of goods and services in general.


FEDERAL AND STATE TAXATION

         Although a bank's income tax liability is determined under the
provisions of the Code, which is applicable to taxpayers or corporations,
sections 581 and 597 of the Code apply specifically to financial institutions.



                                      77
<PAGE>   81



         The two primary areas in which the treatment of financial institutions
differs from the treatment of other corporations under the Code are in the
areas of bond gains and losses, and bad debt deductions. Bond gains and losses
generated from the sale or exchange of portfolio securities are generally
treated for financial institutions as ordinary gains and losses as opposed to
capital gains and losses for other corporations. The Code considers bond
portfolios held by First American to be inventory in a trade or business rather
than to be capital assets. Banks are allowed a statutory method for calculating
a tax deductible reserve for bad debt deductions.

         First American is also subject to certain taxes imposed by the State
of Florida.



                      WHERE YOU CAN FIND MORE INFORMATION
               (INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE)


         The SEC allows us to "incorporate by reference" information into this
Proxy Statement/Prospectus, which means that we can disclose important
information to you by referring you to another document filed separately with
the SEC by SouthTrust. The information incorporated by reference is deemed to
be party of this Proxy Statement/Prospectus, except for any information
superseded by information in this Proxy Statement/Prospectus. This Proxy
Statement/Prospectus incorporates by reference the following documents filed by
SouthTrust with the Commission:

                  1. SouthTrust's Annual Report on Form 10-K for the year ended
         December 31, 1997 (including therein SouthTrust's Proxy Statement for
         its Annual Meeting of Stockholders held April 15, 1998) (Commission
         File No. 0-3613);

                  2. SouthTrust's Quarterly Report on Form 10-Q, dated March
         31, 1998 and June 30, 1998 (Commission File No. 0-3613);

                  3. SouthTrust's Current Report on Form 8-K, dated January 12,
         1998 (Commission File No. 0-3613).

         All documents filed by SouthTrust pursuant to Sections 13(a), 13(c),
14 or 15(d) of the Exchange Act after the date of this Proxy
Statement/Prospectus and prior to final adjournment of the Special Meeting,
shall be deemed to be incorporated by reference into this Proxy
Statement/Prospectus from the date of the filing of such documents.

         The audited financial statements of SouthTrust incorporated herein by
reference should only be read in conjunction with the discussion of consummated
and pending acquisitions set forth under the caption "SUMMARY - Parties to the
Merger - SouthTrust.

         We will provide upon written or oral request, without charge, copies
of all documents with respect to SouthTrust incorporated by reference (not
including exhibits to the documents incorporated by reference unless such
exhibits are specifically incorporated into the documents incorporated by
reference) to each person to whom a copy of this Proxy Statement/Prospectus is
delivered. You should direct requests for such copies to:



                                      78
<PAGE>   82



         Mr. Alton E. Yother
         Secretary, Treasurer and Controller
         SouthTrust Corporation
         420 North 20th Street, 34th Floor
         Birmingham, Alabama 35203
         telephone number (205) 254-5000.


                                 LEGAL MATTERS

         Bradley Arant Rose & White LLP Birmingham, Alabama, counsel for
SouthTrust will give an opinion as to certain legal matters in connection with
the SouthTrust Common Stock being offered by this Proxy Statement/Prospectus. As
of March 31, 1998, the partners and associates of the firm of Bradley Arant Rose
& White LLP beneficially owned approximately 3,052,500 shares of SouthTrust
Common Stock.

         The law firm of Smith, Mackinnon, Greeley, Bowdoin & Edwards, P.A.,
Orlando, Florida, will give an opinion as to certain legal matters relating to
the Merger for First American.


                                    EXPERTS

         The consolidated financial statements of SouthTrust Corporation and
subsidiaries incorporated by reference in this Proxy Statement/Prospectus and
elsewhere in the Registration Statement, to the extent and for the periods
indicated in their reports, have been audited by Arthur Andersen LLP,
independent public accountants, as indicated in their reports with respect
thereto and are incorporated herein by reference in reliance upon the authority
of said firm as experts in giving said reports.

         Rex Meighen & Co., independent public accountants, have audited the
financial statements of First American included in this Proxy
Statement/Prospectus for the periods indicated in their report. We included
these financial statements in this Proxy Statement/Prospectus in reliance upon
the authority of Rex Meighen & Co. as experts in giving said reports. The
financial statements of First American Bank of Indian River County as of
December 31, 1996 and 1995, and for each of the years in the two-year period
ended December 31, 1996, have been included herein and in the registration
statement in reliance upon the report of KPMG Peat Marwick LLP, independent
certified public accountants, appearing elsewhere herein, and upon the
authority of said firm as experts in accounting and auditing.


                             ADDITIONAL INFORMATION

OTHER BUSINESS

         The Board of Directors of First American does not know of any matter
to be brought before the Special Meeting other than as described in the Notice
of Special Meeting accompanying this Proxy Statement/Prospectus. If any other
matter comes before the Special Meeting, it is the intention of the persons
named in the accompanying proxy to vote the proxy in accordance with their best
judgment with respect to such other matters.



                                      79

<PAGE>   83
                              FIRST AMERICAN BANK

                          Independent Auditor's Report
                                      and
                          Audited Financial Statements

                        December 31, 1997, 1996 and 1995



                  Independent Accountant's Compilation Report
                                      and
                         Compiled Financial Statements

                             June 30, 1998 and 1997


                                      F-i

<PAGE>   84



            INDEX TO THE FINANCIAL STATEMENTS OF FIRST AMERICAN BANK


FIRST AMERICAN BANK

<TABLE>
<S>                                                                                        <C>                      
INDEPENDENT AUDITOR'S REPORT, December 31, 1997...........................................  F-1

FINANCIAL STATEMENTS, December 31, 1997

      BALANCE SHEET.......................................................................  F-2

      STATEMENT OF INCOME.................................................................  F-3

      STATEMENT OF CHANGES IN STOCKHOLDERS' EQUITY........................................  F-4

      STATEMENT OF CASH FLOWS.............................................................  F-5

      NOTES TO FINANCIAL STATEMENTS.......................................................  F-6


INDEPENDENT AUDITOR'S REPORT, December 31, 1996 and 1995.................................. F-19

FINANCIAL STATEMENTS, December 31, 1996 and 1995

      BALANCE SHEETS...................................................................... F-20

      STATEMENTS OF EARNINGS.............................................................. F-22

      STATEMENTS OF STOCKHOLDERS' EQUITY.................................................. F-23

      STATEMENTS OF CASH FLOWS............................................................ F-24

      NOTES TO FINANCIAL STATEMENTS....................................................... F-25


FINANCIAL STATEMENTS, June 30, 1998 and 1997

      CONDENSED BALANCE SHEETS............................................................ F-41

      CONDENSED STATEMENTS OF INCOME...................................................... F-42

      CONDENSED STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY.............................. F-43

      CONDENSED STATEMENTS OF CASH FLOWS.................................................. F-44

      NOTES TO CONDENSED FINANCIAL STATEMENTS............................................. F-45
</TABLE>



                                      F-ii

<PAGE>   85



INDEPENDENT AUDITORS' REPORT


To The Board of Directors
First American Bank of Indian River County
Vero Beach, Florida


We have audited the accompanying balance sheet of First American Bank of Indian
River County as of December 31, 1997, and the related statements of income,
changes in stockholders' equity, and cash flows for the year then ended. These
financial statements are the responsibility of the Bank's management. Our
responsibility is to express an opinion on these financial statements based on
our audit.

We conducted our audit in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free of
material misstatement. An audit includes examining, on a test basis, evidence
supporting the amounts and disclosures in the financial statements. An audit
also includes assessing the accounting principles used and significant
estimates made by management, as well as evaluating the overall financial
statement presentation. We believe that our audit provides a reasonable basis
for our opinion.

In our opinion, the financial statements referred to above present fairly, in
all material respects, the financial position of First American Bank of Indian
River County at December 31, 1997, and the results of its operations and its
cash flows for the year then ended in conformity with generally accepted
accounting principles.



                                      /s/ Rex Meighen & Company

                                      Certified Public Accountants

Tampa, Florida 
February 3, 1998



                                      F-1
<PAGE>   86



                   FIRST AMERICAN BANK OF INDIAN RIVER COUNTY
                                 BALANCE SHEET
                               DECEMBER 31, 1997

<TABLE>
<CAPTION>

                                     ASSETS

<S>                                                                       <C>
Cash and due from banks                                                     2,539,269
Federal funds sold                                                          4,825,000
                                                                          -----------
                Total cash and equivalents                                  7,364,269
Securities held-to-maturity, at cost which approximates
          market                                                               54,931
Securities available-for-sale                                               5,492,815

Loans                                                                      29,936,707
Less: Allowance for loan losses                                               283,230
    Deferred loan fees and discounts                                           70,695
                                                                          -----------
                Net loans                                                  29,582,782

Premises and equipment, net                                                   626,269
Accrued interest receivable                                                   369,403
Other real estate owned, (net of $444 allowance)                              503,527
Other assets                                                                  300,908
                                                                          -----------

                Total assets                                              $44,294,904
                                                                          ===========

                      LIABILITIES AND STOCKHOLDERS' EQUITY

Liabilities
  Deposits:
         Noninterest bearing demand                                       $ 8,207,229
         Interest bearing demand                                              798,787
         Money markets                                                      4,252,190
         Savings                                                            1,821,389
         Time deposits                                                     24,332,896
                                                                          -----------
                Total deposits                                             39,412,491
  Accrued interest payable                                                    127,434
  Accrued expenses and other liabilities                                      114,653
                                                                          -----------

                Total liabilities                                          39,654,578
                                                                          -----------

Commitments and Contingencies (Note N)

Stockholders' Equity
  Common stock, $10 par value, authorized 213,000
    shares; issued and outstanding, 117,150 shares                          1,171,500
  Additional paid-in capital                                                  888,340
  Retained earnings                                                         2,584,273
  Unrealized loss on securities available-for-sale, net                        (3,787)
                                                                          -----------

                Total stockholders' equity                                  4,640,326
                                                                          -----------
                Total liabilities and stockholders' equity
                                                                          $44,294,904
                                                                          ===========
</TABLE>


See Accompanying Notes to Financial Statements



                                      F-2
<PAGE>   87



                   FIRST AMERICAN BANK OF INDIAN RIVER COUNTY
                              STATEMENT OF INCOME
                          YEAR ENDED DECEMBER 31, 1997



<TABLE>
<S>                                                                                 <C>
INTEREST INCOME
  Interest and fees on loans                                                        $ 2,863,263
  Interest and dividends on investment securities:
         U. S. Treasury                                                                  49,922
         U. S. Government Agencies                                                      314,779
         Corporate                                                                       27,548
  Income on Federal funds sold                                                          103,860
                                                                                    -----------

                     Total interest income                                            3,359,372

INTEREST EXPENSE ON DEPOSITS                                                          1,342,543
                                                                                    -----------

                     Net interest income                                              2,016,829

PROVISION FOR LOAN LOSSES                                                               107,500
                                                                                    -----------
                     Net interest income after provision for loan losses              1,909,329
                                                                                    -----------

OTHER INCOME
  Service charges on deposit accounts                                                   160,996
  Miscellaneous income                                                                   65,842
  Loss on sales of investment securities available for sale                              (1,797)
                                                                                    -----------

                     Total other income                                                 225,041
                                                                                    -----------

OTHER EXPENSES
  Compensation and employee benefits                                                    801,215
  Occupancy expense                                                                     139,647
  Furniture and equipment expense                                                        82,064
  Net cost of operations of other real estate owned                                      23,452
  Miscellaneous expenses                                                                540,063
                                                                                    -----------

                     Total other expenses                                             1,586,441
                                                                                    -----------

INCOME BEFORE INCOME TAXES                                                              547,929

INCOME TAXES                                                                            197,382
                                                                                    -----------

NET INCOME                                                                          $   350,547
                                                                                    ===========

BASIC EPS                                                                           $      2.74
                                                                                    ===========
</TABLE>


See Accompanying Notes to Financial Statements



                                      F-3
<PAGE>   88



                   FIRST AMERICAN BANK OF INDIAN RIVER COUNTY
                  STATEMENT OF CHANGES IN STOCKHOLDERS' EQUITY


<TABLE>
<CAPTION>

                                                                           Net           Total                                 
                                  Additional                            Unrealized       Stock-                           
                       Common      Paid-in    Retained      Treasury     Holding         holders'
                       Stock       Capital    Earnings        Stock       Losses         Equity
                     ----------   --------   ----------     ---------   ----------     ----------
<S>                  <C>          <C>        <C>            <C>         <C>            <C>
Balance at
 December 31, 1996   $1,065,000   $548,662   $2,654,953     $(38,570)   $  (18,425)    $4,211,620

Sale of treasury
 stock                       --     24,952           --       38,570            --         63,522

Stock dividend          106,500    314,726     (421,226)          --            --             --

Net income                   --         --      350,546           --            --        350,546

Net change in
 net unrealized
 holding losses
 on securities               --         --           --           --        14,638         14,638
                     ----------   --------   ----------     --------    ----------     ----------
Balance at
 December 31, 1997   $1,171,500   $888,340   $2,584,273           --    $   (3,787)    $4,640,326
                     ==========   ========   ==========     ========    ==========     ==========
</TABLE>


See Accompanying Notes to Financial Statements



                                      F-4
<PAGE>   89



                   FIRST AMERICAN BANK OF INDIAN RIVER COUNTY
                            STATEMENT OF CASH FLOWS
                          YEAR ENDED DECEMBER 31, 1997


<TABLE>
<S>                                                                            <C>
 CASH FLOWS FROM OPERATING ACTIVITIES
  Net income                                                                   $   350,546
  Adjustments to reconcile net income to net cash
   provided by operating activities:
         Depreciation and amortization                                              62,702
         Discount accretion                                                         (8,872)
         Provision for loan losses                                                 107,500
         Net recoveries (charge-offs) of other real estate owned                     3,500
         Deferred income taxes                                                      (7,050)
         Loss on sale of securities available-for-sale                               1,797
         Proceeds from sale of loans held for sale                               1,044,476
         Originations of loans held for sale                                    (1,073,025)
         (Increase) decrease in assets:
                Accrued interest receivable                                         12,726
                Other assets                                                       (48,789)
         Increase (decrease) in liabilities:
                Accrued interest payable                                             6,841
                Accrued expenses and other liabilities                             (12,165)
                                                                               -----------
                Net cash provided by operating activities                          440,187
                                                                               -----------
CASH FLOWS FROM INVESTING ACTIVITIES
  Securities available-for-sale:
         Proceeds from maturities                                                2,300,000
         Proceeds from sales                                                     1,741,758
         Purchases of securities                                                (2,499,922)
  Securities to be held-to-maturity:
         Purchases of securities                                                    (4,981)
  Net increase in loans                                                         (2,838,884)
  Sale of other real estate owned                                                   32,284
  Purchase of premises and equipment                                                (3,156)
                                                                               -----------
                Net cash used in investing activities                           (1,272,901)
                                                                               -----------
CASH FLOWS FROM FINANCING ACTIVITIES
  Net increase in deposits                                                       4,798,013
  Proceeds from sale of treasury stock                                              63,522
                                                                               -----------
                Net cash provided by financing activities                        4,861,535
                                                                               -----------
NET INCREASE IN CASH AND CASH EQUIVALENTS                                        4,028,821
CASH AND CASH EQUIVALENTS
  Beginning of year                                                              3,335,448
                                                                               -----------
  End of year                                                                  $ 7,364,269
                                                                               ===========

Supplemental Disclosure of Cash Flow Information Cash paid during the
  year for:
         Interest                                                              $ 1,335,702
         Income taxes                                                          $   179,218

</TABLE>


See Accompanying Notes to Financial Statements



                                      F-5
<PAGE>   90



                   FIRST AMERICAN BANK OF INDIAN RIVER COUNTY
                         NOTES TO FINANCIAL STATEMENTS
                               DECEMBER 31, 1997


NOTE A - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Business:
   The Bank provides a wide range of banking services to individual and
   corporate customers primarily located in Indian River County, Florida, and
   the surrounding counties. The Bank is subject to State and Federal bank
   regulatory authorities and undergoes periodic regulatory examinations.

Basis of Financial Statement Presentation:
   The accounting and reporting policies of First American Bank of Indian River
   County (the Bank) conform with generally accepted accounting principles and
   with general practices within the banking industry. In preparing the
   financial statements, management is required to make estimates and
   assumptions that affect the reported amounts of assets and liabilities and
   disclosure of contingent assets and liabilities as of the date of the
   balance sheet and revenues and expenses for the reporting period. Actual
   results could differ significantly from those estimates.

   Material estimates that are particularly susceptible to significant change
   relate to the determination of the allowance for loan losses and valuation
   of foreclosed assets. In connection with the determination of the allowances
   for loan losses and real estate owned, management obtains independent
   appraisals for significant properties.

   Management believes that the allowance for losses on loans and real estate
   owned is adequate. While management uses available information to recognize
   losses on loans, future additions to the allowances may be necessary based
   on changes in economic conditions. In addition, various regulatory agencies,
   as an integral part of their examination process, periodically review the
   Bank's allowance for losses on loans and real estate owned. Such agencies
   may require the Bank to recognize additions to the allowances based on their
   judgments about information available to them at the time of their
   examination.

Cash and Cash Equivalents:
   The Bank defines cash and cash equivalents as cash on hand, amounts due from
   banks and Federal Reserve, and highly-liquid investments purchased with a
   remaining maturity of three months or less at time of purchase including
   Federal funds sold. Federal funds sold generally cover one day periods.

Investments:
   Statement of Financial Accounting Standards No. 115 ("FAS 115"), Accounting
   for Certain Investments in Debt and Equity Securities, sets the standard for
   classification of and accounting for investments in equity securities that
   have readily determinable fair values, and all investments in debt
   securities which are to be classified as held-to- maturity securities,
   available-for-sale securities, or trading securities.

   Debt securities that an enterprise has the positive intent and ability to
   hold to maturity are classified as held-to- maturity securities and reported
   at amortized cost. Debt and equity securities that are bought and held
   principally for the purpose of selling them in the near term are classified
   as trading securities and reported at fair value, with unrealized gains and
   losses included in earnings. Debt and equity securities not classified as
   either held-to-maturity securities or trading securities are classified as
   available-for-sale securities and reported at fair value, with unrealized
   gains and losses excluded from earnings and reported as a separate component
   of stockholders' equity.

   The Bank classifies its investments at the purchase date in accordance with
   the above-described guidelines. Premiums or discounts on securities at the
   date of purchase are being amortized or accreted, respectively, over the



                                      F-6
<PAGE>   91



   estimated life of the security using a method which approximates the level
   yield method. Gains and losses realized on the disposition of securities are
   based on the specific identification method and are reflected in other
   income. A decline in the market value of any available-for-sale or
   held-to-maturity security that is deemed other than temporary is charged to
   earnings, resulting in the establishment of a new cost basis for the
   security.



                                      F-7
<PAGE>   92



                   FIRST AMERICAN BANK OF INDIAN RIVER COUNTY
                         NOTES TO FINANCIAL STATEMENTS
                               DECEMBER 31, 1997


NOTE A - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

Loans:
   Loans receivable are stated at unpaid principal balance less the allowance
   for loan losses and net of deferred loan origination fees and costs.

   Interest on loans is accounted for on the accrual basis. Generally, the
   Bank's policy is to discontinue the accrual of interest on loans delinquent
   over ninety days unless fully secured and in the process of collection. The
   accrued and unpaid interest is reversed from current income and thereafter
   interest is recognized only to the extent payments are received. A
   nonaccrual loan may be restored to accrual basis when interest and principal
   payments are current and prospects for future recovery are no longer in
   doubt.

   The Bank accounts for impaired loans under Statement of Financial Accounting
   Standards No. 114 ("FAS 114"), Accounting by Creditors for Impairment of a
   Loan, which sets the standard for recognition of loan impairment and the
   measurement methods for certain impaired loans and loans whose terms are
   modified in troubled debt restructurings.

   Under FAS 114, a loan is impaired when it is probable that a creditor will
   be unable to collect the full amount of principal and interest due according
   to the contractual terms of the loan agreement. When a loan is impaired, a
   creditor has a choice of ways to measure the impairment. The measurement of
   impairment may be based on (1) the present value of the expected future cash
   flows of the impaired loan discounted at the loan's original effective
   interest rate, (2) the observable market price of the impaired loan, or (3)
   the fair value of the collateral of a collateral-dependent loan. Creditors
   may select the measurement method on a loan-by-loan basis, except that
   collateral-dependent loans for which foreclosure is probable must be
   measured at the fair value of the collateral. A creditor in a troubled debt
   restructuring involving a restructured loan should measure impairment by
   discounting the total expected future cash flows at the loan's original
   effective rate of interest.

Facilities:
   Facilities are stated at cost, less accumulated depreciation and
   amortization. Charges to income for depreciation and amortization are
   computed on the straight-line method over the assets' estimated useful
   lives.

   When properties are sold or otherwise disposed of, the gain or loss
   resulting from the disposition is credited or charged to income.
   Expenditures for maintenance and repairs are charged against income and
   renewals and betterments are capitalized.

Allowance for Loan Losses:
   The allowance for loan losses is established through a provision for loan
   losses charged to expense. Loans are charged-off against the allowance when
   management believes that the collectibility of principal is unlikely.
   Recoveries of amounts previously charged-off are credited to the allowance.
   The allowance for loan losses is based on management's evaluation of various
   factors including prevailing and anticipated economic conditions,
   diversification and size of the loan portfolio, current financial status and
   credit standing of the borrower, the status and level of nonperforming
   assets, past and expected loan loss experience, adequacy of collateral,
   specific impaired loans and economic conditions. Allowances for impaired
   loans are generally determined based on collateral values or the present
   value of estimated cash flows.

Loan Origination Fees and Costs:
   Loan origination and commitment fees and certain direct loan origination
   costs are deferred and recognized over the term of the related loans as a
   yield adjustment under a method which approximates the interest method. Fees
   and direct loan origination costs for unexercised commitments are recognized
   in income upon expiration of the commitment.



                                      F-8
<PAGE>   93



                   FIRST AMERICAN BANK OF INDIAN RIVER COUNTY
                         NOTES TO FINANCIAL STATEMENTS
                               DECEMBER 31, 1997


NOTE A - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

Income Taxes:
   The Bank accounts for income taxes under the asset and liability method as
   prescribed in FAS No. 109, Accounting for Income Taxes. Deferred tax assets
   and liabilities are recognized for the future tax consequences attributable
   to differences between the financial statement carrying amounts of existing
   assets and liabilities and their respective tax bases and operating loss and
   tax credit carryforwards. Deferred tax assets and liabilities are measured
   using enacted tax rates expected to apply to taxable income in the year in
   which those temporary differences are expected to be recovered or settled.
   The effect on deferred tax assets and liabilities of a change in tax rates
   is recognized in income in the period that includes the enactment date.

Basic EPS:
   Basic EPS is computed by dividing net income by the weighted average
   (128,063) shares of common stock outstanding during the year. Retroactive
   effect has been given to stock dividends including a 10% stock dividend
   issued in the subsequent period.

Real Estate Owned:
   Real estate owned represents property acquired through foreclosure, or
   deeded to the Bank in lieu of foreclosure, on real estate mortgage loans on
   which the borrowers have defaulted as to payment of principal and interest.
   Other real estate owned at time of foreclosure is recorded at the lower of
   the Bank's cost of acquisition or the asset's fair value less costs to sell,
   which becomes the property's new basis. Any write-downs at date of
   acquisition are charged to the allowance for loan losses. Expenses incurred
   in maintaining assets and subsequent write-downs to reflect declines in the
   fair value or changes in the selling costs of the property are in the
   allowance for losses on real estate owned which is included in net costs of
   operations of other real estate owned.

Off Balance Sheet Financial Instruments:
   In the ordinary course of business, the Bank has entered into off balance
   sheet financial instruments consisting of commitments to extend credit and
   standby letters of credit. Such financial instruments are recorded in the
   financial statements when they become payable.


NOTE B - SECURITIES AVAILABLE-FOR-SALE

On December 31, 1997, the Bank classified the following investments as
securities available-for-sale. The amortized cost and estimated market value of
securities available-for-sale are as follows:

<TABLE>
<CAPTION>
                                                  AMORTIZED     UNREALIZED     UNREALIZED       MARKET
                                                    COST          GAINS          LOSSES          VALUE      
                                                 ----------     ----------     ----------     ----------
   <S>                                           <C>            <C>            <C>            <C>
   U. S. Treasury Securities                     $  499,313     $  219         $   --         $  499,532

   Obligations of other U. S 
   government agencies and
   corporations                                   4,749,539      3,355          9,767          4,743,127

   Corporate debt securities                        250,000        156             --            250,156
                                                 ----------     ------         ------         ----------

                                                 $5,498,852     $3,730         $9,767         $5,492,815
                                                 ==========     ======         ======         ==========
</TABLE>



                                      F-9

<PAGE>   94



                   FIRST AMERICAN BANK OF INDIAN RIVER COUNTY
                         NOTES TO FINANCIAL STATEMENTS
                               DECEMBER 31, 1997


NOTE B - SECURITIES AVAILABLE-FOR-SALE (CONTINUED)

The amortized cost and estimated market value of securities available-for-sale
at December 31, 1997, by contractual maturity, are shown below:



<TABLE>
<CAPTION>                                         ESTIMATED   
                             AMORTIZED             MARKET
                                COST               VALUE        
                             ----------          ----------
<S>                          <C>                 <C>
Due in one year or less      $1,499,313          $1,499,845
Due in one to five years      3,999,539           3,992,970
                             ----------          ----------

                             $5,498,852          $5,492,815
                             ==========          ==========
</TABLE>

The estimated market value of investment securities is based on quoted market
values, if available. If a quoted market price is not available, fair value is 
estimated using quoted market prices of similar securities.

Expected maturities disclosed above will differ from contractual maturities
because borrowers may have the right to call or prepay obligations with or
without call or prepayment penalties.

Proceeds and gross realized losses from sales of securities available-for-sale
during 1997 amounted to $1,741,758 and $1,797, respectively.

At December 31, 1997, $999,312 of securities available-for-sale, at amortized
cost, were pledged as collateral for public fund deposits.

Securities to be held-to-maturity consist primarily of $52,432 of Federal
Reserve Bank Stock.


NOTE C - LOANS

Loans consists of:

<TABLE>
      <S>                                             <C>
      Real estate mortgage                            $17,970,113
      Real estate construction                            931,710
      Commercial, financial and agriculture             4,466,130
      Consumer and other                                6,568,754
                                                      -----------

                                                       29,936,707
      Less: Allowance for loan losses                     283,230
                Deferred loan fees and discounts           70,695
                                                      -----------

                                                      $29,582,782
                                                      ===========
</TABLE>

As of December 31, 1997, the Bank had no commitments to sell any loans.

For loans subject to repricing, fair value is estimated at the carrying amount
plus accrued interest. In the opinion of management, the fair value of other
type loans estimated by discounting future cash flows using the current rates
at which similar loans would be made to borrowers with similar credit ratings
and the same remaining maturities, would not materially differ from their
carrying value.



                                     F-10
<PAGE>   95



                   FIRST AMERICAN BANK OF INDIAN RIVER COUNTY
                         NOTES TO FINANCIAL STATEMENTS
                               DECEMBER 31, 1997


NOTE C - LOANS (CONTINUED)

An analysis of the activity in the allowance for loan losses follows:

<TABLE>
   <S>                                                     <C>
   Balance, beginning of year                              $268,375
   Provisions charged to expense                            107,500
   Loans charged off                                        (98,878)
   Recoveries                                                 6,233
                                                           --------

   Balance, end of year                                    $283,230
                                                           ========
   </TABLE>

There were no nonaccrual, reduced rate or impaired loans at December 31, 1997.
A loan is considered impaired when it is probable that the Bank will be unable
to collect all amounts due, according to the contractual terms of the
agreement.


NOTE D - REAL ESTATE OWNED

Real estate owned includes the following:

<TABLE>
   <S>                                                     <C>
   Real estate acquired in satisfaction of loans           $503,971
   Less, allowance for losses                                   444
                                                           --------

                                                           $503,527
                                                           ========
</TABLE>

Activity in the allowance for losses on real estate owned is as follows:

<TABLE>
   <S>                                                     <C>
   Beginning balance                                       $ 8,870
   Provision for losses                                         --
   Charge-offs                                              (8,426)
   Recoveries                                                   --
                                                           -------

   Ending balance                                          $   444
                                                           =======
</TABLE>


Provisions for losses on real estate owned are included in net costs of
operations of other real estate owned in the statement of income.



                                     F-11
<PAGE>   96



                   FIRST AMERICAN BANK OF INDIAN RIVER COUNTY
                         NOTES TO FINANCIAL STATEMENTS
                               DECEMBER 31, 1997


NOTE E - PREMISES AND EQUIPMENT

Premises and equipment consist of:

<TABLE>
   <S>                                                     <C>
   Land                                                    $  327,914
   Building                                                   408,574
   Furniture and equipment                                    379,836
   Capitalized lease property                                  35,374
   Vehicles                                                    15,759
                                                           ----------
                                                            1,167,457
   Less, accumulated depreciation                             541,188
                                                           ----------

            Net premises and equipment                     $  626,269
                                                           ==========
</TABLE>

Noninterest expenses for the year ended December 31, 1997, include depreciation
of premises and equipment of $62,702.


NOTE F - TIME DEPOSITS

Time deposits at December 31, 1997 totaled $24,332,896. Maturities of such
deposits are as follows:

<TABLE>
<CAPTION>
YEAR ENDING DECEMBER 31,
        <S>                                <C>
        1998                               $19,093,579
        1999                               $ 3,870,401
        2000                               $   422,156
        2001                               $   230,423
        2002                               $   716,337
</TABLE>

Time deposits of $100,000 or more as of December 31, 1997 aggregated
$4,684,419. Interest expense on such deposits aggregated $207,357 for 1997.

The fair value of demand deposits, savings accounts, and certain money market
accounts is the amount payable on demand at the reporting date. In the opinion
of management, the fair value of long-term fixed maturity certificates of
deposit, estimated using the rates currently approved for deposits of similar
remaining maturities, would not materially differ from their carrying values.

NOTE G - BORROWINGS

The Bank has unsecured lines-of-credit with other banks which enable the Bank
to borrow up to $2,500,000. No advances on these lines were outstanding as of
December 31, 1997.



                                     F-12
<PAGE>   97


                   FIRST AMERICAN BANK OF INDIAN RIVER COUNTY
                         NOTES TO FINANCIAL STATEMENTS
                               DECEMBER 31, 1997


NOTE H - LEASES

The Bank leases the premises for its Southside Banking Center under a
noncancellable operating lease expiring July 31, 2003.

Minimum lease payments for future years ending December 31, are as follows:

<TABLE>
        <S>                                <C>
        1998                               $ 57,081
        1999                                 62,085
        2000                                 69,169
        2001                                 75,000
        2002                                 75,000
        Thereafter                           43,750
                                           --------

                                           $382,085
                                           ========
</TABLE>

Rental expense charged to operations, including charges for common area
maintenance, was $70,464 for the year ended December 31, 1997.


NOTE I - OTHER NONINTEREST EXPENSE

Miscellaneous expenses for 1997 was comprised of the following:

<TABLE>
        <S>                                   <C>
        Data processing fees                  $124,462
        Postage, forms and supplies            105,794
        Director fees                           82,650
        Professional services                   40,990
        Other insurance                         33,365
        Other                                  152,802
                                              --------

                                              $540,063
                                              ========
</TABLE>


NOTE J - INCOME TAXES

Income tax expense (benefit) consists of:

<TABLE>
<CAPTION>
                                     CURRENT        DEFERRED        TOTAL        
                                    ---------      ---------      ---------
        <S>                         <C>            <C>            <C>
        Federal                     $190,133       $(13,573)      $176,560
        State                         22,837         (2,015)        20,822
                                    --------       --------       --------

                                    $212,970       $(15,588)      $197,382
                                    ========       ========       ========
</TABLE>



                                     F-13
<PAGE>   98



                   FIRST AMERICAN BANK OF INDIAN RIVER COUNTY
                         NOTES TO FINANCIAL STATEMENTS
                               DECEMBER 31, 1997


NOTE J - INCOME TAXES (CONTINUED)

The following is a reconciliation of income tax expense computed at the Federal
statutory rate of 34% and the income tax provision shown on the statement of
income:

<TABLE>
      <S>                                                                                <C>
      Tax computed at Federal statutory rate                                             $186,290
      Increases (decreases) in tax resulting from:
           State income tax, net of Federal tax benefit                                    12,599
           Other, net                                                                      (1,513)
                                                                                         -------- 

      Income tax expense                                                                 $197,382
                                                                                         ======== 
</TABLE>

The tax effects of temporary differences that give rise to significant portions
of the deferred tax assets and deferred tax liabilities at December 31, 1997
are presented below:

<TABLE>
      <S>                                                                                <C>
      Deferred tax assets:
           Loans receivable, due to difference in
            allowance for loan losses                                                    $ 89,100
           Other real estate owned, due to differences
            in allowance for other real estate owned                                       36,400
           Deferred loan fees and costs, net, due to
            differences in recognizing income and expense                                   5,800
           Unrealized loss on securities available-for-sale                                 2,250
                                                                                         -------- 
               Total gross deferred tax assets                                            133,550
                                                                                         -------- 

      Deferred tax liabilities:
           Office property and equipment, due to
            difference in recognizing depreciation expense                                 32,300
                                                                                         -------- 

               Net deferred tax assets                                                   $101,250
                                                                                         ======== 
</TABLE>

Net deferred tax assets are included in other assets.

Management believes that the deferred tax asset will be fully realized; and
therefore, no valuation allowance is required at December 31, 1997.

NOTE K - STOCK OPTION PLAN

Certain key employees of the Bank have options to purchase shares of the Bank's
common stock under its Key Employees' Stock Option Plan (the "Plan"). Under the
Plan, the total number of shares which may be issued shall not exceed 20%
(currently 23,430 shares) of the Bank's total outstanding shares. Option prices
per share are set by the Compensation Committee of the Board of Directors at
the time of grant, but the price cannot be less than the book value of a share
of stock at the date of grant. Options granted under the Plan become
exercisable and shall lapse in such manner and within such period or periods
not to exceed ten years from the date granted. The options are non-transferable
and expire upon termination of employment with the Bank, except in the event of
death or disability.

At December 31, 1997, options for 13,000 shares have been granted with an
exercise price of $40.00 per share. The stock options expire over various
periods as follows: 5,000 in 2000 and 8,000 in 2007. At December 31, 1997,
10,430 shares remain available for grant.



                                     F-14
<PAGE>   99



                   FIRST AMERICAN BANK OF INDIAN RIVER COUNTY
                         NOTES TO FINANCIAL STATEMENTS
                               DECEMBER 31, 1997


NOTE K - STOCK OPTION PLAN (CONTINUED)

The Bank accounts for these options based upon APB Opinion No. 25. Accordingly,
no compensation cost has been recognized for its stock options. Had the
compensation cost been determined based upon FAS Opinion No. 123, the Bank's
net income would have been reduced approximately $52,000.

The fair value of each option granted is estimated on the date of grant using
an acceptable option-pricing model with the following weighted assumptions for
the options granted in 1997: dividend yield of -0- percent; expected volatility
of -0- percent; risk-free interest rate of 6 percent; and an expected life of
five years.

A summary of the status of the Bank's stock option plan as of December 31, 1997
and changes during the year is presented below:

<TABLE>
<CAPTION>
      FIXED OPTIONS
           <S>                                                                           <C>
           Outstanding at beginning of year                                                  5,000
           Granted                                                                          13,000
           Expired                                                                          (5,000)
                                                                                         ---------

           Outstanding at end of year                                                       13,000
                                                                                         ---------

           Options exercisable at year end                                                      -- 
                                                                                         =========

           Weighted average fair value of options granted                                $   10.35
            during the year per share                                                    =========
</TABLE>


NOTE L - EMPLOYEE BENEFITS

During 1993, the Bank established a defined contribution plan which is
available to all employees who have worked one year. Employees may make an
election to contribute up to 9% of their income. During 1997, the Bank made a
contribution to the employees' accounts for an expense of $16,493. As of
December 31, 1997, all funds are being held in a Bank savings account.

NOTE M - RELATED PARTY TRANSACTIONS

Certain officers, directors, and employees of the Bank and certain corporations
and individuals related to such persons have deposits and indebtedness, in the
form of loans as customers. The total of such deposits at December 31, 1997 was
$792,258. Following is a summary of activity during 1997 for such loans:

<TABLE>
<CAPTION>
         BALANCE AT                                                         BALANCE AT
        DECEMBER 31,              ADDITIONS             REPAYMENTS         DECEMBER 31,
           1996                                                                1997
      -----------------       -----------------     ----------------     ----------------
      <S>                     <C>                   <C>                  <C>
          $2,213,741              $1,753,825           $2,458,264           $1,509,302
          ==========              ==========           ==========           ==========
</TABLE>

Outstanding Loan commitments to officers, directors and employees of the Bank
as of December 31, 1997 amounted to $246,858.

For the period ended December 31, 1997, the Bank incurred professional fees in
the amount of $12,956 to the firm of a director of the Bank.



                                     F-15
<PAGE>   100



                   FIRST AMERICAN BANK OF INDIAN RIVER COUNTY
                         NOTES TO FINANCIAL STATEMENTS
                               DECEMBER 31, 1997


NOTE N - COMMITMENTS AND CONTINGENCIES

The financial statements do not reflect various commitments and contingent
liabilities which arise in the normal course of business and which involve
elements of credit risk, interest rate and liquidity risk. These commitments
and contingent liabilities are commitments to extend credit and standby letters
of credit. A summary of these commitments and contingent liabilities as of
December 31, 1997 follows:

<TABLE>
      <S>                                        <C>
      Commitments to extend credit               $1,953,747
      Standby letters of credit                  $  526,508
</TABLE>

The Bank's exposure to credit loss in the event of nonperformance by the other
party for commitments to extend credit and standby letters of credit is
represented by the contractual notional amount of those instruments. The Bank
uses the same credit policies in making commitments and conditional obligations
as it does for on-balance sheet instruments.

Commitments to extend credit are agreements to lend to a customer as long as
there is no violation of any condition established in the contract. Commitments
generally have fixed expiration dates or other termination clauses and may
require payment of a fee. Since many of the commitments are expected to expire
without being drawn upon, the total commitment amounts do not necessarily
represent future cash requirements. The Bank evaluates each customer's
creditworthiness on a case-by-case basis. The amount of collateral obtained if
deemed necessary by the Bank upon extension of credit is based on management's
credit evaluation of the counterparty. Collateral held varies but may include
accounts receivable, inventory, property and equipment, and income-producing
commercial properties.

Letters of credit are written conditional commitments issued by the Bank to
guarantee the performance of a customer to a third party. Those guarantees are
primarily issued to support public and private borrowing arrangements. The
credit risk involved in issuing letters of credit is essentially the same as
that involved in extending loan facilities to customers.

The Bank is both claimant and defendant in various legal proceedings and, in
addition, there are outstanding commitments and other contingent liabilities
incurred in the normal course of business. In the opinion of management, the
resolution of such matters will not have a material effect on the financial
statements.

NOTE O - REGULATORY CAPITAL

The Bank is subject to various regulatory capital requirements administered by
the Federal banking agencies. Failure to meet minimum capital requirements can
initiate certain mandatory and possibly additional discretionary actions by
regulators that, if undertaken, could have a direct material effect on the
Bank's financial statements. Under capital adequacy guidelines and the
regulatory framework for prompt corrective action, the Bank must meet specific
capital guidelines that involve quantitative measures of the Bank's assets,
liabilities and certain off-balance sheet items as calculated under regulatory
accounting practices. The Bank's capital amounts and classification are also
subject to qualitative judgments by the regulators about components, risk
weightings and other factors.

Quantitative measures established by regulation to ensure capital adequacy
require the Bank to maintain minimum amounts and ratios (set forth in the table
below) of total and Tier I capital (as defined in the regulations) to
risk-weighted assets. Management believes as of December 31, 1997, that the
Bank meets all capital adequacy requirements to which it is subject.

As of December 31, 1997, the most recent notification from the Federal Deposit
Insurance Corporation categorized the Bank as well capitalized under the
regulatory framework for prompt corrective action. To be categorized as well
capitalized, the Bank must maintain total risk-based, Tier I leverage ratios as
set forth in the table. There are no conditions or events since that
notification that management believes have changed in the institution's
category.



                                     F-16
<PAGE>   101
                   FIRST AMERICAN BANK OF INDIAN RIVER COUNTY
                         NOTES TO FINANCIAL STATEMENTS
                               DECEMBER 31, 1997


NOTE O - REGULATORY CAPITAL (CONTINUED)

The Bank's actual capital amounts and ratios are also presented in the table.


<TABLE>
<CAPTION>
                                                                                 To Be Well Capitalized
                                                                                      under prompt     
                                                              For Capital           Corrective Action  
                                        Action             Adequacy Purposes          Provisions
                                 -------------------      -------------------    -----------------------
   (Dollars in Thousands)         Amount      Ratio       > Amount    > Ratio    > Amount        > Ratio
                                                          -           -          -               -
- ------------------------------   -------    --------      --------   --------    --------        -------
<S>                              <C>        <C>           <C>        <C>         <C>             <C>
As of December 31, 1997:
  Total risk-based capital
     (to risk-weighted assets)    $4,927      16.95%       $2,326       8.0%      $2,907           10.0%
  Tier I capital
     (to risk-weighted assets)    $4,644      15.98%       $1,163       4.0%      $1,744            6.0%
  Tier I capital
     (to adjusted total assets)   $4,644      11.14%       $1,668       4.0%      $2,502            6.0%
</TABLE>


NOTE P - CONCENTRATIONS OF CREDIT RISK

Substantially all of the Bank's loans, commitments and standby letters of
credit have been granted to customers in Indian River County, Florida, and
surrounding counties. The concentration of credit by type of loan are set forth
in Note C. The distribution of commitments to extend credit approximates the
distribution of loans outstanding. Standby letters of credit were granted
primarily to commercial borrowers.


NOTE Q - RESTRICTIONS ON RETAINED EARNINGS AND DIVIDEND PAYMENTS

Banking law limits the amount of dividends which may be paid to the Bank's net
profits for the current year plus its retained net profits for the preceding
two years. Any additional amounts paid require prior approval of the
appropriate regulatory authority.



                                     F-17
<PAGE>   102



                              FIRST AMERICAN BANK
                             OF INDIAN RIVER COUNTY

                              Financial Statements

                           December 31, 1996 and 1995

                  (With Independent Auditors' Report Thereon)



                                     F-18
<PAGE>   103


                          INDEPENDENT AUDITORS' REPORT


The Board of Directors
First American Bank of
 Indian River County:


We have audited the accompanying balance sheets of First American Bank of
Indian River County as of December 31, 1996 and 1995, and the related
statements of earnings, stockholders' equity, and cash flows for the years then
ended. These financial statements are the responsibility of the Bank's
management. Our responsibility is to express an opinion on these financial
statements based on our audits.

We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audits to
obtain reasonable assurance about whether the financial statements are free of
material misstatement. An audit includes examining, on a test basis, evidence
supporting the amounts and disclosures in the financial statements. An audit
also includes assessing the accounting principles used and significant
estimates made by management, as well as evaluating the overall financial
statement presentation. We believe that our audits provide a reasonable basis
for our opinion.

In our opinion, the financial statements referred to above present fairly, in
all material respects, the financial position of First American Bank of Indian
River County at December 31, 1996 and 1995 and the results of its operations
and its cash flows for the years then ended in conformity with generally
accepted accounting principles.



/s/ KPMG Peat Marwick LLP


Vero Beach, Florida
January 16, 1997



                                     F-19
<PAGE>   104

                   FIRST AMERICAN BANK OF INDIAN RIVER COUNTY

                                 Balance Sheets
                           December 31, 1996 and 1995

<TABLE>
<CAPTION>
                          ASSETS                                         1996           1995
                                                                         ----           ----

<S>                                                                  <C>            <C>
Cash and due from banks                                              $ 2,335,448    $ 1,945,440
Federal funds sold                                                     1,000,000      3,600,000
Securities held to maturity at cost which approximates market             49,950         49,950
Securities available for sale                                          7,006,464      5,333,497

Loans                                                                 27,295,509     23,529,055
Less:
     Allowance for loan losses                                           268,375        222,138
     Deferred loan fees and discounts                                     69,448         68,710
                                                                     -----------    -----------
            Net loans                                                 26,957,687     23,238,207

Premises and equipment, net                                              685,815        524,507
Accrued interest receivable                                              382,129        311,831
Other real estate owned, (net of $8,870 and $38,346
     allowance in 1996 and 1995, respectively)                           452,077        486,267
Other assets                                                             203,939        137,914
                                                                     -----------    -----------

Total assets                                                         $39,073,509    $35,627,613
                                                                     ===========    ===========
</TABLE>



                                     F-20
<PAGE>   105


<TABLE>
<CAPTION>
                  LIABILITIES AND STOCKHOLDERS' EQUITY                              1996                1995
                                                                                    ----                ----
<S>                                                                            <C>                 <C>
Liabilities:
  Deposits:
         Non-interest bearing demand                                           $  5,629,258        $  5,641,116
         Interest bearing demand                                                    883,216             735,690
         Money markets                                                            4,495,940           3,964,016
         Savings                                                                  1,630,844           1,304,250
         Time deposits                                                           21,975,220          19,820,360
                                                                               ------------        ------------

                Total deposits                                                   34,614,478          31,465,432

  Accrued interest payable                                                          120,593             104,508
  Accrued expenses and other liabilities                                            126,818              73,857
                                                                               ------------        ------------

         Total liabilities                                                       34,861,889          31,643,797
                                                                               ------------        ------------

Stockholders' equity:
  Common stock, $10 par value, authorized 106,500
         shares; issued and outstanding, including shares in
         treasury, 106,500 shares                                                 1,065,000           1,065,000
  Additional paid-in capital                                                        548,662             533,904
  Retained earnings                                                               2,654,953           2,420,217
  Unrealized gain (loss) on securities available for sale,
         net                                                                        (18,425)             24,695
  Less common stock in Treasury at cost, 1,800 shares
         and 2,800 shares in 1996 and 1995, respectively                            (38,570)            (60,000)
                                                                               ------------        ------------


         Total stockholders' equity                                               4,211,620           3,983,816



                                                                               ------------        ------------

         Total liabilities and stockholders' equity                            $ 39,073,509        $ 35,627,613
                                                                               ============        ============
</TABLE>


See accompanying notes to financial statements.



                                     F-21
<PAGE>   106



                   FIRST AMERICAN BANK OF INDIAN RIVER COUNTY

                             Statements of Earnings
                     Years Ended December 31, 1996 and 1995

<TABLE>
<CAPTION>
                                                                                    1996                1995
                                                                                    ----                ----
<S>                                                                            <C>                 <C>
Interest income:
  Loans, including fees                                                        $  2,412,719        $  2,392,497
  Securities                                                                        403,641             260,680
  Federal funds sold                                                                194,510             211,967
                                                                               ------------        ------------

         Total interest income                                                    3,010,870           2,865,144

Interest expense on deposits                                                      1,301,787           1,196,859
                                                                               ------------        ------------

         Net interest income                                                      1,709,083           1,668,285

Provision for loan losses                                                            32,388              33,535

         Net interest income after provision for loan
                losses                                                            1,676,695           1,634,750

Non-interest income:
  Service charges on deposit accounts                                               125,050             107,667
  Other fees for customer services                                                   34,431              24,253
  Gain on sales of investment securities available for sale                             938              16,175
                                                                               ------------        ------------

         Total non-interest income                                                  160,419             148,095
                                                                               ------------        ------------

Non-interest expenses:
  Compensation and employee benefits                                                721,230             590,267
  Occupancy expense                                                                  63,982              50,539
  Furniture and equipment expense                                                    76,874              71,062
  Net cost of operations of other real estate owned                                  85,736              76,628
  Other                                                                             507,956             458,394
                                                                               ------------        ------------

         Total non-interest expenses                                              1,455,778           1,246,890
                                                                               ------------        ------------

         Earnings before income taxes                                               381,336             535,955

Income tax expense                                                                  146,600             175,930
                                                                               ------------        ------------

         Net income                                                            $    234,736        $    360,025
                                                                               ============        ============
</TABLE>


See accompanying notes to financial statements.



                                     F-22
<PAGE>   107

                   FIRST AMERICAN BANK OF INDIAN RIVER COUNTY

                       Statements of Stockholders' Equity

                     Years Ended December 31, 1996 and 1995

<TABLE>
<CAPTION>

                                                                                                 Unrealized
                                                                                               Gain (Loss) on      Total
                                                    Additional                                   Securities        Stock-
                                      Common          Paid-In       Retained      Treasury      Available for     holders'
                                       Stock          Capital       Earnings        Stock         Sale, Net        Equity  
                                     ----------    -----------     ----------    -----------   --------------   ---------- 
<S>                                  <C>           <C>             <C>           <C>           <C>              <C>        
Balances at December 31, 1994        $1,055,000    $   526,140     $2,060,192             --     $  (56,046)    $3,585,286

Issuance of 1,000 shares of
  common stock                           10,000          7,764             --             --             --         17,764

Purchase of 2,800 shares
  of common stock                            --             --             --        (60,000)            --        (60,000)

Net income                                   --             --        360,025             --             --        360,025

Change in unrealized gain
  (loss) on securities
  available for sale, net                    --             --             --             --         80,741         80,741
                                     ----------    -----------     ----------    -----------     ----------     ----------    

Balances at December 31, 1995         1,065,000        533,904      2,420,217        (60,000)        24,695      3,983,816

Issuance of 1,000 shares of
  common stock                               --         14,758             --         21,430             --         36,188

Net income                                   --             --        234,736             --             --        234,736

Change in unrealized gain
  (loss) on securities
  available for sale, net                    --             --             --             --        (43,120)       (43,120)
                                     ----------    -----------     ----------    -----------     ----------     ----------    

Balances at December 31, 1996        $1,065,000    $   548,662     $2,654,953    $   (38,570)    $  (18,425)    $4,211,620
                                     ==========    ===========     ==========    ===========     ==========     ==========    
</TABLE>


See accompanying notes to financial statements.



                                     F-23
<PAGE>   108



                   FIRST AMERICAN BANK OF INDIAN RIVER COUNTY
                            Statements of Cash Flows
                     Years Ended December 31, 1996 and 1995

<TABLE>
<CAPTION>

                                                                                             1996                      1995
                                                                                             ----                      ----
<S>                                                                                      <C>                      <C>
Net income                                                                               $   234,736              $   360,025
Adjustments to reconcile net earnings to net cash provided by operating activities:
  Depreciation and amortization                                                               61,304                   41,969
  Discount accretion                                                                         (12,733)                  (6,748)
  Writedown of other real estate owned to fair value                                          54,000                       --
  Provision for loan losses                                                                   32,388                   33,535
  Provision for losses on other real estate owned                                                 --                   43,965
  Net recoveries (charge-offs) of other real estate owned                                         --                   (5,619)
  Increase in deferred taxes                                                                 (29,400)                 (12,000)
  Gain on sale of securities available for sale                                                 (938)                 (16,175)
  Loss on sale of other real estate owned                                                         --                   12,520
  Proceeds from sale of loans held for sale                                                2,039,958                  657,775
  Originations of loans held for sale                                                     (2,015,200)                (650,100)
  (Increase) decrease in accrued interest receivable                                         (70,298)                  16,697
  Decrease (increase) in other assets                                                        (15,181)                  22,107
  Increase in accrued interest payable                                                        16,085                    1,797
  Increase (decrease) in accrued expenses and other liabilities                               52,961                  (32,503)
                                                                                         -----------              -----------

         Net cash provided by operating activities                                           347,682                  467,245
                                                                                         -----------              -----------

Cash flows from investing activities:
  Maturities of securities available for sale                                              2,000,122                1,450,000
  Sale of securities available for sale                                                      250,938                  996,601
  Purchases of securities available for sale                                              (3,974,921)              (4,777,730)
  Loan originations, net of repayments                                                    (3,972,532)                  19,501
  Sale of other real estate owned                                                            176,096                  225,212
  Purchase of premises and equipment                                                        (222,612)                 (24,783)
                                                                                         -----------              -----------

         Net cash used for investing activities                                           (5,742,909)              (2,111,199)
                                                                                         -----------              -----------

Cash flows front financing activities:
  Net increase in deposits                                                                 3,149,047                2,662,314
  Proceeds from issuance of stock                                                             36,188                   17,764
  Purchase of common stock                                                                        --                  (60,000)
                                                                                         -----------              -----------

                Net cash provided by financing activities                                  3,185,235                2,620,080
                                                                                         -----------              -----------

                Net increase (decrease) in cash and cash equivalents                      (2,209,992)                 976,126

Cash and cash equivalents, beginning of year                                               5,545,440                4,569,314
                                                                                         -----------              -----------

Cash and cash equivalents, end of year                                                   $ 3,335,448              $ 5,545,440
                                                                                         -----------              -----------

Supplemental disclosures:
  Cash was paid for:
         Interest                                                                        $ 1,285,702              $ 1,195,062
         Income taxes                                                                        129,840                  195,690

Supplemental schedule of noncash investing and financing activities.
  Net change in unrealized gain (loss) on securities available for sale                  $    43,120              $   122,335
  Transfer of loans to other real estate owned                                               195,906                  511,927
</TABLE>


See accompanying notes to financial statements



                                     F-24
<PAGE>   109



                   FIRST AMERICAN BANK OF INDIAN RIVER COUNTY

                         Notes to Financial Statements

                           December 31, 1996 and 1995


(1)      SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

         (a)      BASIS OF FINANCIAL STATEMENT PRESENTATION

                  The accounting and reporting policies of First American Bank
                  of Indian River County (the Bank) conform with generally
                  accepted accounting principles and with reporting guidelines
                  as prescribed by banking regulatory authorities. Actual
                  results could differ significantly from those estimates.

                  Substantially all of the Bank's real estate loans and real
                  estate owned are secured by real estate in Indian River
                  County, Florida. Accordingly, the ultimate collectibility of
                  a substantial portion of the Bank's loan portfolio and the
                  recovery of the carrying amount of real estate owned are
                  susceptible to changes in market conditions in the above
                  mentioned county.

                  The preparation of financial statements in conformity with
                  generally accepted accounting principles requires management
                  to make estimates and assumptions that affect the reported
                  amounts of assets and liabilities and disclosure of
                  contingent assets and liabilities at the date of the
                  financial statements and the reported amounts of revenues and
                  expenses during the reporting period. Actual results could
                  differ from those estimates.

                  Material estimates that are particularly susceptible to
                  significant change in the near-term relate to the
                  determination of the allowance for loan losses and allowance
                  for real estate owned, if any. In connection with the
                  determination of the allowances for loan losses and real
                  estate owned, management obtains independent appraisals for
                  significant properties.

                  Management believes that the allowance for losses on loans
                  and real estate owned is adequate. While management uses
                  available information to recognize losses on loans, future
                  additions to the allowances may be necessary based on changes
                  in economic conditions. In addition, various regulatory
                  agencies, as an integral part of their examination process,
                  periodically review the Bank's allowance for losses on loans
                  and real estate owned. Such agencies may require the Bank to
                  recognize additions to the allowances based on their
                  judgments about information available to them at the time of
                  their examination.

         (b)      CASH AND CASH EQUIVALENTS

                  The Bank defines cash and cash equivalents as cash on hand,
                  amounts due from banks and Federal Reserve, and highly-liquid
                  investments purchased with a remaining maturity of three
                  months or less at time of purchase including federal funds
                  sold. Federal funds sold generally cover one day periods.

         (c)      LOANS

                  Loans receivable are stated at unpaid principal balances,
                  less the allowance for loan losses.



                                     F-25
<PAGE>   110


                   FIRST AMERICAN BANK OF INDIAN RIVER COUNTY

                         Notes to Financial Statements


                  Interest is accrued only if deemed collectible. Generally,
                  the Bank's policy is not to accrue interest on loans
                  delinquent over ninety days unless fully secured and in the
                  process of collection. The accrued and unpaid interest
                  delinquent over 90 days and deemed uncollectible is reversed
                  against current income. A nonaccrual loan may be restored to
                  accrual basis when interest and principal payments are
                  current and prospects for future recovery are no longer in
                  doubt.

                  The allowance for loan losses is established through charges
                  to operations. The allowance for loan losses is maintained at
                  a level considered adequate by management to provide for loan
                  losses. Loans are charged-off against the allowance when
                  management believes the collectibility of principal is
                  doubtful. Recoveries of amounts previously charged-off are
                  credited to the allowance. The provision for loan losses is
                  based on management's judgment after considering all loans on
                  which full collectibility may not be reasonably assured, the
                  estimate of the value of the underlying collateral on the
                  loans, loan loss history, and prevailing and anticipated
                  economic conditions.

                  The Bank, considering current information and events
                  regarding the borrower's ability to repay their obligations,
                  considers a loan to be impaired when it is probable that the
                  Bank will be unable to collect all amounts due according to
                  the contractual terms of the loan agreement. When a loan is
                  considered to be impaired, the amount of the impairment is
                  measured based on the present value of expected future cash
                  flows discounted at the loan's effective interest rate, the
                  secondary market value of the loan, or the fair value of the
                  collateral for collateral dependent loans. Impaired loans are
                  written down to the extent that principal is judged to be
                  uncollectible and, in case of impaired collateral dependent
                  loans where repayment is expected to be provided solely by
                  the underlying collateral and there is no other available and
                  reliable sources of repayment, are written down to the lower
                  of cost or collateral value. Impairment losses are included
                  in the allowance for loan losses through a charge to the
                  provision for loan losses.

                  The Bank records impairment in the value of its loans as an
                  addition to the allowance for loan losses. Any changes in the
                  value of impaired loans due to the passage of time or
                  revisions in estimates are reported as adjustments to
                  provision expense in the same manner in which impairment
                  initially was recognized.

         (d)      LOAN ORIGINATION FEES AND COSTS

                  Loan origination and commitment fees and certain direct loan
                  origination costs are deferred and recognized over the term
                  of the related loans as a yield adjustment under a method
                  which approximates the interest method. Fees and direct loan
                  origination costs for unexercised commitments are recognized
                  in income upon expiration of the commitment.

         (e)      INVESTMENT SECURITIES

                  The Bank classifies its debt and equity securities in one of
                  three categories: trading available-for-sale, or
                  held-to-maturity. Trading securities are bought and held
                  principally for the purpose of selling them in the near term.
                  Held-to-maturity securities are securities in which the Bank
                  has the ability and intent to hold the security until
                  maturity. All other securities not included in trading or
                  held-to maturity are classified as available for sale.



                                     F-26
<PAGE>   111



                   FIRST AMERICAN BANK OF INDIAN RIVER COUNTY

                         Notes to Financial Statements


                  Trading and available-for-sale securities are recorded at
                  fair value. Held-to maturity securities, which consists
                  primarily of Federal Reserve Bank Stock of $47,450 at
                  December 31, 1996 and 1995, are recorded at amortized cost,
                  adjusted for the amortization or accretion of premiums or
                  discounts. Unrealized holding gains and losses on trading
                  securities are included in earnings. Unrealized holding gains
                  and losses, net of tax effects, on available-for-sale
                  securities are excluded from earnings and are reported as a
                  separate component of stockholders' equity until realized.
                  Transfers of securities between categories are recorded at
                  fair value at the date of transfer.

                  A decline in the market value of any available-for-sale or
                  held-to-maturity security below cost that is deemed other
                  than temporary is charged to earnings resulting in the
                  establishment of a new cost basis for the security.

                  Premiums and discounts are amortized or accreted over the
                  life of the related held to-maturity security as an
                  adjustment to yield using the effective interest method.
                  Dividend and interest income are recognized when earned.
                  Realized gains and losses for securities classified as
                  available-for-sale are included in earnings and are derived
                  using the specific identification method for determining the
                  cost of securities sold.

         (f)      PREMISES AND EQUIPMENT

                  Premises and equipment are carried at cost and depreciation
                  is provided on the straight-line method over the estimated
                  useful lives of the related assets. Estimated lives are
                  generally three to seven years for furniture and equipment
                  and 20 years for the Bank's building. Gains and losses on
                  dispositions are reflected in current operations.

                  Maintenance and repairs are charged to expense as incurred.
                  Improvements and betterments that prolong the useful lives of
                  assets are capitalized.

         (g)      INCOME TAXES

                  The Bank accounts for income taxes under the asset and
                  liability method. Deferred tax assets and liabilities are
                  recognized for the future tax consequences attributable to
                  differences between the financial statement carrying amounts
                  of existing assets and liabilities and their respective tax
                  bases and operating loss and tax credit carry-forwards.
                  Deferred tax assets and liabilities are measured using
                  enacted tax rates expected to apply to taxable income in the
                  years in which those temporary differences are expected to be
                  recovered or settled. The effect on deferred tax assets and
                  liabilities of a change in tax rates is recognized in income
                  in the period that includes the enactment date.

         (h)      REAL ESTATE OWNED

                  Real estate owned represents property acquired through
                  foreclosure, or deeded to the Bank in lieu of foreclosure, on
                  real estate mortgage loans on which the borrowers have
                  defaulted as to payment of principal and interest. Other real
                  estate owned at time of foreclosure is recorded at the lower
                  of the Bank's cost of acquisition or the asset's fair value
                  less costs to sell, which becomes the property's new basis.
                  Any write-downs at date of acquisition are charged to the
                  allowance for loan losses. Expenses incurred in maintaining
                  assets and subsequent write-downs to reflect declines in the
                  fair value or changes in the selling costs of the property
                  are in the allowance for losses on real estate owned which is
                  included in net costs of operations of other real estate
                  owned.



                                     F-27
<PAGE>   112
                   FIRST AMERICAN BANK OF INDIAN RIVER COUNTY

                         Notes to Financial Statements


         (i)      RECLASSIFICATIONS

                  Certain 1995 amounts have been reclassified to conform with
                  1996 presentation.


(2)      SECURITIES AVAILABLE FOR SALE

         On December 31, 1996 and 1995, the Bank classified the following
         investments as securities available for sale. The amortized cost and
         estimated market value of securities available for sale are as
         follows:

<TABLE>
<CAPTION>
                                                     DECEMBER 31, 1996
                                  -------------------------------------------------------
                                                    GROSS            GROSS     ESTIMATED
                                   AMORTIZED      UNREALIZED       UNREALIZED    MARKET  
                                     COST           GAINS           LOSSES       VALUE  
                                     ----           -----           ------       -----

<S>                               <C>             <C>              <C>         <C>
U.S. Treasury Securities          $1,245,818        $ 3,011             --     $1,248,829
Obligations of other U.S. 
  government agencies and
  corporations                     4,988,633             --         30,898      4,957,735
Corporate debt securities            799,162            738             --        799,900
                                  ----------        -------       --------     ----------  

                                  $7,033,613        $ 3,749       $ 30,898     $7,006,464
                                  ==========        =======       ========     ==========  
</TABLE>

<TABLE>
<CAPTION>

                                                     DECEMBER 31, 1995 
                                  -------------------------------------------------------
                                                    GROSS           GROSS      ESTIMATED        
                                   AMORTIZED      UNREALIZED      UNREALIZED     MARKET         
                                     COST           GAINS           LOSSES       VALUE        
                                     ----           -----           ------       -----

<S>                               <C>             <C>             <C>          <C>          
U. S. Treasury Securities         $  751,991        $ 8,243             --     $  760,234
Obligations of other U.S. 
  government agencies and
  corporations                     3,745,438         21,125             --      3,766,563
Corporate debt securities            798,651          8,049             --        806,700
                                  ----------        -------           ----     ----------          
                                  $5,296,080        $37,417             --     $5,333,497
                                  ==========        =======           ====     ==========
</TABLE>
  
The amortized cost and estimated market value of securities available for
sale at December 31, 1996 and 1995, by contractual maturity, are shown
below:

<TABLE>
<CAPTION>
                                            1996                           1995  
                                  -------------------------------------------------------
                                                  ESTIMATED                     ESTIMATED        
                                   AMORTIZED        MARKET       AMORTIZED        MARKET       
                                     COST           VALUE          COST           VALUE       
                                     ----           -----          ----           -----  
               
<S>                               <C>            <C>            <C>            <C>    
Due in one year or less           $1,800,105     $1,802,135     $  493,468     $  497,031
Due in one to five years           5,233,508      5,204,329      4,802,612      4,836,466
                                  ----------     ----------     ----------     ----------       
                                  $7,033,613     $7,006,464     $5,296,080     $5,333,497
                                  ==========     ==========     ==========     ==========
</TABLE>
   

                                     F-28
<PAGE>   113

                   FIRST AMERICAN BANK OF INDIAN RIVER COUNTY
                                             
                         Notes to Financial Statements

Expected maturities disclosed above will differ from contractual maturities
because borrowers may have the right to call or prepay obligations with or
without call or prepayment penalties.

Proceeds and gross realized gains from sales of securities available for sale
during 1996 amounted to $250,938 and $938, respectively. Proceeds and gross
realized gains from sales of securities available for sale during 1995 amounted
to $996,601 and $16,175, respectively.
                                                                      
At December 31, 1996, $1,000,455 of securities available for sale, at amortized
cost, were pledged as collateral for public fund deposits.

(3)            LOANS

<TABLE>
<CAPTION>


               Loans consist of:
                                                                            1996                 1995
                                                                            ----                 ----

               <S>                                                     <C>                   <C>   
               Real estate mortgage                                    $ 17,383,953          $15,561,885
               Real estate construction                                     304,903              865,698
               Commercial, financial and agriculture                      4,752,482            4,705,630
               Consumer and other                                         4,854,171            2,395,842
                                                                       ------------          ----------- 
                                                                         27,295,509           23,529,055
               Less:  Allowance for loan losses                             268,375              222,138
                      Deferred loan fees and discounts                       69,448               68,710
                                                                       ------------          -----------
                                                                       $ 26,957,687          $23,238,207
                                                                       ============          ===========
</TABLE>


As of December 31, 1996 and 1995 the Bank had no commitments to sell any
loans.

An analysis of the activity in the allowance for loan losses follows:

<TABLE>
<CAPTION>
                                                                             1996                  1995
                                                                             ----                  ----

               <S>                                                         <C>                  <C>        
               Balance, beginning of year                                  $222,138             $270,113
               Provision charged to expense                                  32,388               33,535
               Loans charged off                                            (25,180)             (82,830)
               Recoveries                                                    39,029                1,320
                                                                           --------             --------

               Balance, end of year                                        $268,375             $222,138
                                                                           ========             ========
</TABLE>

Nonaccrual and reduced rate loans amounted to $199,299 and $102,221 at December
31, 1996 and 1995, respectively. If interest on these loans had been accrued
normally, additional income earned would approximate $1,976 and $10,241 for the
years ended December 31, 1996 and 1995, respectively. Other loans 90 days or
more past due on accrual status amounted to $291,453 and $223,247 at December
31, 1996 and 1995, respectively. Accrued interest income on such loans amounted
to $1,055 and $906 at December 31, 1996 and 1995, respectively.


                                     F-29
<PAGE>   114

                   FIRST AMERICAN BANK OF INDIAN RIVER COUNTY
                                                
                         Notes to Financial Statements


Information concerning the Bank's impaired loans at December 31, 1996 and 1995
and the years then ended is summarized as follows

<TABLE>
<CAPTION>
                                                                           1996        1995
                                                                           ----        ----   
   
<S>                                                                        <C>         <C> 
Impaired loans with SFAS 114 allowance                                     $     --         --
Impaired loans without SFAS 114 allowance                                   226,017    124,644
                                                                           --------    -------               

Total investment in impaired loans                                         $226,017   $124,644
                                                                           ========   ========         

Allowance for credit losses related to impaired
loans                                                                      $ 33,903   $ 31,358
                                                                           ========   ========        

Approximate average recorded investment in
impaired loans                                                             $ 65,429   $152,981
                                                                           ========   ========  
</TABLE>
                               

It is the Bank's general policy to lend generally on a secured basis. The Bank
is not committed to lend additional funds to debtors whose loans have been
modified.

The Bank has defined its primary market area as Indian River County, and the
majority of commercial and real estate mortgage loans granted to customers
reside in this area. Generally, commercial loans are secured by general
business assets including receivables, inventory and equipment, and real estate
mortgage loans are secured by either first or second mortgages on residential
or commercial property. As of December 31, 1996, substantially all of the
Bank's loan portfolio was secured.

Certain officers, directors, and employees of the Bank and certain corporations
and individuals related to such persons incurred indebtedness, in the form of
loans, as customers. These loans were made on substantially the same terms,
including interest rates and collateral, as those prevailing at the time for
comparable transactions with other customers and did not involve more than the
normal risk of collectibility. Following is a summary of activity during 1996
for such loans

<TABLE>
<CAPTION>
                BALANCE AT                                                                           BALANCE AT
             DECEMBER 31, 1995               ADDITIONS                  REPAYMENTS                DECEMBER 31, 1996
             -----------------               ---------                  ----------                -----------------  

             <S>                             <C>                        <C>                       <C> 
                 $1,879,830                  1,745,804                   1,411,893                    $2,213,741
                 ==========                  =========                   =========                    ==========
</TABLE>
         

Outstanding loan commitments to officers, directors and employees of the Bank
as of December 31, 1996 amount to $271,275.

(4)            REAL ESTATE OWNED

               Real estate owned includes the following:

<TABLE>
<CAPTION>
                                                                           1996        1995
                                                                           ----        ----

               <S>                                                         <C>         <C>            
               Real estate acquired in satisfaction of loans               $460,947   $524,613
               Less allowance for losses                                      8,870     38,346
                                                                           --------   --------
     
                                                                           $452,077   $486,267
                                                                           ========   ========
</TABLE>


                                     F-30
                                        
<PAGE>   115

                   FIRST AMERICAN BANK OF INDIAN RIVER COUNTY
                                            
                         Notes to Financial Statements


               Activity in the allowance for losses on real estate owned is as
               follows:

<TABLE>
<CAPTION>
                                                                            1996       1995
                                                                            ----       ----

               <S>                                                          <C>        <C>    
               Beginning balance                                            $38,346    $    --
               Provision for losses                                              --     43,965
               Charge-offs                                                  (40,276)    (6,119)
               Recoveries                                                    10,800        500
                                                                            -------    -------

               Ending balance                                               $ 8,870    $38,346
                                                                            =======    =======
</TABLE>


               Provisions for losses on real estate owned are included in net
               costs of operations of other real estate owned in the statement
               of earnings.

                                                                        
(5)            PREMISES AND EQUIPMENT

               Premises and equipment consist of:

<TABLE>
<CAPTION>
                                                                          1996         1995
                                                                          ----         ----

               <S>                                                       <C>          <C>
               Land                                                      $  327,914   $327,914
               Building                                                     408,574    309,050
               Furniture and equipment                                      376,680    255,992
               Capitalized lease property                                    35,374     35,374
               Vehicles                                                      15,759     15,759
                                                                         ----------   --------
         
                                                                          1,164,301    944,089
               Less accumulated depreciation                                478,486    419,582
                                                                         ----------   --------

                      Net premises and equipment                         $  685,815   $524,507
                                                                         ==========   ========
</TABLE>


(6)            DEPOSITS

               Time deposits of $100,000 or more as of December 31, 1996 and
               1995 aggregated $3,948,787 and $4,115,306 respectively. Interest
               expense on such deposits aggregated $314,344 and $271,955 for
               1996 and 1995, respectively.

(7)            BORROWINGS

               The Bank has unsecured lines of credit with other banks which
               enable the Bank to borrow up to $1,600,000 through March of
               1997. No advances on these lines were outstanding as of December
               31, 1996.


                                     F-31
<PAGE>   116

                   FIRST AMERICAN BANK OF INDIAN RIVER COUNTY
                                              
                         Notes to Financial Statements


(8)            LEASES


                                     F-32
<PAGE>   117

                   FIRST AMERICAN BANK OF INDIAN RIVER COUNTY
                                              
                         Notes to Financial Statements


               The Bank leases the premises for its Southside Banking Center
               under a noncancelable operating lease expiring July 31, 2003.

               Minimum lease payments for future years ending December 31 are
               as follows:

<TABLE>
                     <S>                          <C>    
                     1997                         $  52,084
                     1998                            57,081
                     1999                            62,085
                     2000                            69,169
                     2001                            75,000
                     Thereafter                     118,750
                                                  ---------
    
                                                  $ 434,169
                                                  =========
</TABLE>
    
               Rental expense charged to operations, including charges for
               common area maintenance, was $28,730 for the year ended December
               31, 1996.
                                                                        

(9)            OTHER NONINTEREST EXPENSE

               Other noninterest expense for 1996 and 1995 was comprised of the
               following:

<TABLE>
<CAPTION>
                                                                            1996        1995
                                                                            ----        ---- 
      
               <S>                                                        <C>         <C>
               Data processing fees                                       $ 105,852   $ 94,567
               Postage, forms and supplies                                  101,870     71,496
               Director fees                                                 82,550     65,900
               Professional services                                         44,567     43,265
               Other insurance                                               31,959     30,116
               Other                                                        141,158    153,590
                                                                          ---------   --------

                                                                          $ 507,956   $458,394
                                                                          =========   ========
</TABLE>


                                      F-33


<PAGE>   118
                   FIRST AMERICAN BANK OF INDIAN RIVER COUNTY
                                             
                         Notes to Financial Statements
                                             
 
(10)           INCOME TAXES

               Income tax expense (benefit) consists of

<TABLE>
<CAPTION>
                                                  CURRENT             DEFERRED               TOTAL 
                                                  -------             --------               -----

               <S>                               <C>                  <C>                  <C>        
               1996:
                      Federal                    $ 160,000            $(25,000)            $135,000
                      State                         16,000              (4,400)              11,600
                                                 ---------            --------             --------     
                                                 $ 176,000            $(29,400)            $146,600

               1995:
                      Federal                    $ 175,000            $(10,200)            $164,800
                      State                         12,930              (1,800)              11,130
                                                 ---------            --------             --------
     
                                                 $ 187,930            $(12,000)            $175,930
                                                 =========            ========             ======== 
</TABLE>

         
The effective tax rate for each year is different from the statutory federal
income tax rate of 34%. The reasons for the differences follows:

<TABLE>
<CAPTION>
                                                                      1996                  1995
                                                                      ----                  ---- 

<S>                                                                   <C>                  <C>    
Expected tax expense at statutory federal income tax rate             $129,700             $182,200

Increases (decreases) in tax resulting from:
         State income tax, net of federal tax benefit                    7,800               11,700
         Other, net                                                      9,100              (17,970)
                                                                      --------             --------  

Income tax expense                                                    $146,600             $175,930
                                                                      ========             ========
</TABLE>


                                     F-34

<PAGE>   119


                   FIRST AMERICAN BANK OF INDIAN RIVER COUNTY

                         Notes to Financial Statements

The tax effects of temporary differences that give rise to significant portions
of the deferred tax assets and deferred tax liabilities at December 31, 1996
and 1995 are presented below:

<TABLE>
<CAPTION>
                                                                                 1996          1995
                                                                                 ----          ----
        <S>                                                                    <C>           <C>
        Deferred tax assets:
               Loans receivable, principally due to difference in
                      allowance for loan losses                                $ 66,300      $58,400
               Other real estate owned, principally due to difference in
                      allowance for other real estate owned                      39,500       14,400
               Deferred loan fees and costs, net, principally due to
                      differences in recognizing income and expense               5,400       15,600
               Unrealized loss on securities available for sale                   8,700           --
                                                                               --------      --------

                      Total gross deferred tax assets                           119,900       88,400
                                                                               --------      --------

        Deferred tax liabilities:
               Office property and equipment, principally due to
                      difference in recognizing depreciation expense             25,700       32,400
               Unrealized gain on securities available for sale                      --       12,722
                                                                               --------      -------

                      Total gross defected tax liabilities                       25,700       45,122
                                                                               --------      -------

                             Net deferred tax assets                           $ 94,200      $43,278
                                                                               ========      =======
</TABLE>

        Net deferred tax assets are included in other assets 


               The Bank believes that it has paid sufficient taxes in prior
               carryback years which will enable it to recover the net deferred
               tax assets; and therefore, no valuation allowance is required at
               December 31, 1996 or 1995.

      (11)     EMPLOYMENT CONTRACT AND STOCK OPTION PLAN

               The Bank has an employment contract with its president for a
               three-year period commencing January 1, 1996, which includes a
               provision for a bonus to be paid for the year based upon
               earnings of the Bank. The contract also granted to the president
               options to purchase 5,000 shares of common stock at an exercise
               price of $40 per share. These options are exercisable as of
               January 1, 1997 for a period of five years. The Bank applies APB
               Opinion No. 25 and related interpretations in accounting for
               this stock option plan. Accordingly, no compensation cost has
               been recognized for its stock option plan. Had compensation cost
               for the Bank's stock-based compensation plan been determined
               consistent with FASB Statement No. 123, the Bank's net income
               would have been reduced to the pro forma amounts indicated
               below:

<TABLE>
<CAPTION>
                                   1996          1995
                                   ----          ----

        <S>                      <C>           <C>
        Net income:
               As reported       $234,736      $360,025
               Pro forma          228,436       360,025
</TABLE>


                                     F-35
<PAGE>   120


                   FIRST AMERICAN BANK OF INDIAN RIVER COUNTY

                         Notes to Financial Statements

               The fair value of each option granted is estimated on the date
               of grant using an acceptable option-pricing model with the
               following weighted average assumptions for the options granted
               in 1996: dividend yield of -0- percent; expected volatility of
               -0- percent; risk-free interest rate of 6 percent; and an
               expected life of five years.

               A summary of the status of the Bank's stock option plan as of
               December 31, 1996 and 1995 and changes during the years ended on
               those dates is presented below:

<TABLE>
<CAPTION>
                            FIXED OPTIONS                     1996       1995
                            -------------                     ----       ----

               <S>                                          <C>         <C>   
               Outstanding at beginning of year             $   --      $1,000
               Granted                                       5,000          --
               Exercised                                        --       1,000
                                                            ------      ------
               Outstanding at end of year                    5,000          -- 
                                                            ------      ------
               Options exercisable at year end                  --          -- 
                                                            ------      ------
               Weighted average fair value of options
               granted during the year per share             10.11          -- 
                                                            ------      ------
</TABLE>

               The following table summarized information about fixed stock
               options outstanding at December 31, 1996:

<TABLE>
<CAPTION>
                                                                                                               Weighted
                                       Number             Weighted          Weighted         Number            average
              Range of               outstanding         remaining           average      exercisable at    exercise price
              exercise               at December        contractual         exercise        December 31,     at December
               prices                 31, 1996             life               price            1996           31, 1996
               ------                 --------             ----               -----            ----           --------

              <S>                    <C>                <C>                 <C>           <C>               <C>
               $40.00                 5,000              5 years             $40.00           $    --         $    --
</TABLE>

      (12)     EMPLOYEE BENEFITS

               During 1993, the Bank established a defined contribution plan
               which is available to all employees who have worked one year.
               Employees may make an election to contribute up to 9% of their
               income. During 1996 and 1995, the Bank made a contribution to
               the employees' accounts for an expense of $13,764 and $12,367,
               respectively. As of December 31, 1996 and 1995, all funds are
               being held in a Bank savings account.

      (13)     RELATED PARTY TRANSACTIONS

               For the period ended December 31, 1996 and 1995, the Bank
               incurred professional fees in the amount of $865 and $21,465,
               respectively, to the firm of a director of the Bank.


                                     F-36
<PAGE>   121


                   FIRST AMERICAN BANK OF INDIAN RIVER COUNTY

                         Notes to Financial Statements

      (14)     FINANCIAL INSTRUMENTS WITH OFF-BALANCE SHEET RISK


                                     F-37
<PAGE>   122

                   FIRST AMERICAN BANK OF INDIAN RIVER COUNTY

                         Notes to Financial Statements

               The Bank is a party to financial instruments with off-balance
               sheet risk in the normal course of business to meet the
               financing needs of its customers. These financial instruments
               include commitments to extend credit and standby letters of
               credit. Those instruments involve, to varying degrees, elements
               of credit and interest rate risk in excess of the amounts
               recognized in the balance sheet. The contract or notional
               amounts of those instruments reflect the extent of involvement
               the Bank has in particular classes of financial instruments.

               The following table summarizes these financial instruments and
               other commitments and contingent liabilities at December 31,
               1996 and 1995:

<TABLE>
<CAPTION>
                                                                                  1996            1995
                                                                               ----------      ----------
               <S>                                                             <C>             <C>
               Financial instruments whose credit risk is represented by
                      contract amounts:
               Commitments to extend credit                                    $1,482,136      $2,123,373
               Standby letters of credit                                          300,997          52,001
                                                                               ----------      ----------

                                                                               $1,783,133      $2,175,374
                                                                               ==========      ==========
</TABLE>

               The Bank's exposure to credit loss in the event of
               nonperformance by the other party to the financial instrument
               for commitments to extend credit and standby letters of credit
               is represented by the contractual notional amount of those
               instruments. The Bank uses the same credit policies in making
               commitments and conditional obligations as it does for
               on-balance sheet instruments.

               Commitments to extend credit are agreements to lend to a
               customer as long as there is no violation of any condition
               established in the contract. Commitments generally have fixed
               expiration dates or other termination clauses and may require
               payment of a fee. Since many of the commitments are expected to
               expire without being drawn upon, the total commitment amounts do
               not necessarily represent future cash requirements. The Bank
               evaluates each customer's creditworthiness on a case-by-case
               basis. The amount of collateral obtained if deemed necessary by
               the Bank upon extension of credit is based on management's
               credit evaluation of the counterparty. Collateral held varies
               but may include accounts receivable, inventory, property, plant,
               and equipment, and income-producing commercial properties.

               Letters of credit are written conditional commitments issued by
               the Bank to guarantee the performance of a customer to a third
               party. Those guarantees are primarily issued to support public
               and private borrowing arrangements. All guarantees expire in
               1997. The credit risk involved in issuing letters of credit is
               essentially the same as that involved in extending loan
               facilities to customers.

      (15)     REGULATORY CAPITAL

               The Bank is subject to various regulatory capital requirements
               administered by the federal banking agencies. Failure to meet
               minimum capital requirements can initiate certain mandatory and
               possibly additional discretionary actions by regulators that, if
               undertaken, could have a direct material effect on the Bank's
               financial statements. Under capital adequacy guidelines and the
               regulatory framework for prompt corrective action, the Bank must
               meet specific capital guidelines that involve quantitative
               measures of the Bank's assets, liabilities and certain
               off-balance-sheet items as calculated under regulatory
               accounting practices. The Bank's capital amounts and
               classification are also subject to qualitative judgments by the
               regulators about components, risk weightings and other factors.


                                     F-38
<PAGE>   123
                   FIRST AMERICAN BANK OF INDIAN RIVER COUNTY

                          Notes to Financial Statements

               Quantitative measures established by regulation to ensure
               capital adequacy require the Bank to maintain minimum amounts
               and ratios (set forth in the table below) of total and Tier I
               capital (as defined in the regulations) to risk-weighted assets.
               Management believes, as of December 31, 1996, that the Bank
               meets all capital adequacy requirements to which it is subject.

               As of December 31, 1996, the most recent notification from the
               Federal Deposit Insurance Corporation categorized the Bank as
               well capitalized under the regulatory framework for prompt
               corrective action. To be categorized as well capitalized, the
               Bank must maintain total risk-based, Tier I leverage ratios as
               set forth in the table. There are no conditions or events since
               that notification that management believes have changed in the
               institution's category.

               The Bank's actual capital amounts and ratios are also presented
               in the table.

<TABLE>
<CAPTION>
                                                                                                            TO BE WELL
                                                                                                        CAPITALIZED UNDER
                                                                            FOR CAPITAL                 PROMPT CORRECTIVE
                                              ACTUAL                     ADEQUACY PURPOSES              ACTION PROVISIONS
                                     -------------------------       -----------------------          -----------------------
                                       AMOUNT            RATIO         AMOUNT           RATIO           AMOUNT          RATIO
                                     ----------         ------       ----------        ------         ----------       ------
      <S>                            <C>                <C>          <C>               <C>            <C>              <C>  
      As of December 31, 1996:
        Total capital (to risk
               weighted assets)      $4,537,000          16.99%      $2,133,520         >8.0%         $2,666,900        >10.0%
                                                                                        -                               -

      Tier I capital (to risk         4,269,000          16.01%       1,066,760         >4.0%          1,600,140         >6.0%
        weighted assets)                                                                -                                -

      Tier I capital (to
        average assets)               4,269,000          11.25%       1,517,880         >4.0%          1,897,350         >5.0%
                                                                                        -                                -
</TABLE>


                                      F-39

<PAGE>   124


                               FIRST AMERICAN BANK
                             OF INDIAN RIVER COUNTY


                         CONDENSED FINANCIAL STATEMENTS
                                  JUNE 30, 1998


                                      F-40

<PAGE>   125



                   FIRST AMERICAN BANK OF INDIAN RIVER COUNTY
                            CONDENSED BALANCE SHEETS



<TABLE>
<CAPTION>
                                                                                                       
                                                                                    JUNE 30,        DECEMBER 31,         JUNE 30,   
                                                                                      1998              1997               1997
                                                                                   -----------      ------------       ------------
                                                                                   (Unaudited)                          (Unaudited)
<S>                                                                                <C>              <C>                <C>         
ASSETS

    Cash and due from banks                                                        $ 2,373,976      $  2,539,269       $  2,697,149
    Federal funds sold                                                               5,275,000         4,825,000          1,475,000
                                                                                   -----------      ------------       ------------
                    Total cash and equivalents                                       7,648,976         7,364,269          4,172,149
    Securities held-to-maturity, at cost which
      approximates market                                                               54,931            54,931             51,249
    Securities available-for-sale                                                    6,004,266         5,492,815          6,951,814

    Loans                                                                           30,409,798        29,936,707         29,403,969
    Less: Allowance for loan losses                                                    300,577           283,230            276,073
          Deferred loan fees and discounts                                              76,958            70,695             72,258
                                                                                   -----------      ------------       ------------
                    Net loans                                                       30,032,263        29,582,782         29,055,638

    Premises and equipment, net                                                        596,299           626,269            656,066
    Accrued interest receivable                                                        398,821           369,403            384,309
    Other real estate owned                                                            306,845           503,527            416,292
    Other assets                                                                       342,100           300,908            403,394
                                                                                   -----------      ------------       ------------

                    Total assets                                                   $45,384,501      $ 44,294,904       $ 42,090,911
                                                                                   ===========      ============       ============

LIABILITIES AND STOCKHOLDERS' EQUITY


    LIABILITIES
      Deposits:
             Noninterest bearing demand                                            $ 8,204,572      $  8,207,229       $  8,503,971
             Interest bearing demand                                                   813,424           798,787            932,510
             Money markets                                                           4,566,610         4,252,190          4,964,194
             Savings                                                                 1,754,728         1,821,389          1,810,197
             Time deposits                                                          24,993,146        24,332,896         21,221,544
                                                                                   -----------      ------------       ------------
                 Total deposits                                                     40,332,480        39,412,491         37,432,416
      Accrued interest payable                                                         135,471           127,434            111,482
      Accrued expenses and other liabilities                                            73,584           114,653            102,189
                                                                                   -----------      ------------       ------------

                 Total liabilities                                                  40,541,535        39,654,578         37,646,087
                                                                                   -----------      ------------       ------------

    STOCKHOLDERS' EQUITY
      Common stock, $10 par value, authorized 213,000
        shares; issued and outstanding, 117,150 shares for
        1997; 128,865 shares for 1998                                                1,288,650         1,171,500          1,171,500
      Additional paid-in capital                                                     1,240,844           888,340            888,340
      Retained earnings                                                              2,309,631         2,584,273          2,409,378
      Accumulated other comprehensive income                                             3,841            (3,787)           (24,394)
                                                                                   -----------      ------------       ------------

                  Total stockholders                                                 4,842,966         4,640,326          4,444,824
                                                                                   -----------      ------------       ------------

                  Total liabilities and stockholders' equity                       $45,384,501      $ 44,294,904       $ 42,090,911
                                                                                   ===========      ============       ============
</TABLE>




See Accompanying Notes to Condensed Financial Statements


                                      F-41

<PAGE>   126



                   FIRST AMERICAN BANK OF INDIAN RIVER COUNTY
                         CONDENSED STATEMENTS OF INCOME



<TABLE>
<CAPTION>
                                                                           SIX MONTHS ENDED                  THREE MONTHS ENDED
                                                                               JUNE 30,                           JUNE 30,
                                                                    -----------------------------         -------------------------
                                                                       1998              1997              1998              1997
                                                                    ----------        -----------         --------        ---------
                                                                                                 (Unaudited)
<S>                                                                 <C>               <C>                 <C>             <C>      
INTEREST INCOME
  Interest and fees on loans                                        $1,442,968        $ 1,386,836         $731,332        $ 668,622
  Interest and dividends on investment
   securities:
         U. S. Treasury                                                  4,949             33,513            4,949           18,739
         U. S. Government Agencies                                     170,139            170,924           81,858           78,027
         Corporate                                                       9,173             18,885            4,586           11,580
  Income on Federal funds sold                                         141,508             57,489           64,809           36,478
                                                                    ----------        -----------         --------        ---------
                   Total interest income                             1,768,737          1,667,647          887,534          813,446

INTEREST EXPENSE ON DEPOSITS                                           746,761            672,321          369,242          338,407
                                                                    ----------        -----------         --------        ---------
                   Net interest income                               1,021,976            995,326          518,292          475,039

PROVISION FOR LOAN LOSSES                                               65,000             32,500           45,000                -
                                                                    ----------        -----------         --------        ---------
                   Net interest income after
                    provision for loan losses                          956,976            962,826          473,292          475,039
                                                                    ----------        -----------         --------        ---------

OTHER INCOME
  Service charges on deposit accounts                                   81,265             75,888           39,871           33,582
  Miscellaneous income                                                  49,504             22,030           22,998            8,389
                                                                    ----------        -----------         --------        ---------
                   Total other income                                  130,769             97,918           62,869           41,971
                                                                    ----------        -----------         --------        ---------

OTHER EXPENSES
  Compensation and employee benefits                                   381,543            375,643          182,955          179,862
  Occupancy expense                                                     75,263             70,343           36,183           34,323
  Furniture and equipment expense                                       34,235             43,315           17,546           23,378
  Net cost of operations of other real estate
   owned                                                                16,667             15,696            3,053            4,199
  Miscellaneous expenses                                               275,025            269,496          134,268          133,813
                                                                    ----------        -----------         --------        ---------
                   Total other expenses                                782,733            774,493          374,005          375,575
                                                                    ----------        -----------         --------        ---------

INCOME BEFORE INCOME TAXES                                             305,012            286,251          162,156          141,435

INCOME TAXES                                                           110,000            110,600           56,000           51,110
                                                                    ----------        -----------         --------        ---------

NET INCOME                                                             195,012            175,651          106,156           90,325

OTHER COMPREHENSIVE INCOME (LOSS):
  Unrealized gains (losses) on securities                                7,628             (5,969)           2,644          (45,177)
                                                                    ----------        -----------         --------        ---------

COMPREHENSIVE INCOME                                                $  202,640        $   169,682         $108,800        $  45,148
                                                                    ==========        ===========         ========        =========

NET INCOME PER SHARE                                                $     1.51        $      1.38         $   0.82        $    0.71
                                                                    ==========        ===========         ========        =========
</TABLE>



See Accompanying Notes to Condensed Financial Statements


                                      F-42

<PAGE>   127


                   FIRST AMERICAN BANK OF INDIAN RIVER COUNTY
             CONDENSED STATEMENT OF CHANGES IN STOCKHOLDERS' EQUITY



<TABLE>
<CAPTION>
                                                                                                         Accumulated
                                                      Additional                                            Other         Total
                                         Common        Paid-in        Retained           Treasury       Comprehensive  Stockholders'
                                         Stock         Capital        Earnings            Stock             Income        Equity
                                       ----------     ----------     -----------      ---------------   -------------  -------------
                                                                              (Unaudited)
<S>                                    <C>            <C>            <C>              <C>               <C>            <C>        
Balance at
 December 31, 1996                     $1,065,000     $  548,662     $ 2,654,953      $       (38,570)    $(18,425)     $ 4,211,620

Sale of treasury
 stock                                          -         24,952               -               38,570            -           63,522

Stock dividend                            106,500        314,726        (421,226)                   -            -                -

Net income                                      -              -         175,651                    -            -          175,651

Other Comprehensive
 Income - Unrealized
 losses on securities                           -              -               -                    -       (5,969)          (5,969)
                                       ----------     ----------     -----------      ---------------     --------      -----------

Balance at
 June 30, 1997                          1,171,500        888,340       2,409,378                    -      (24,394)       4,444,824

Net income                                      -              -         174,895                    -            -          174,895

Other Comprehensive
 Income - Unrealized
 gains on securities                            -              -               -                    -       20,607           20,607
                                       ----------     ----------     -----------      ---------------     --------      -----------

Balance at
 December 31, 1997                      1,171,500        888,340       2,584,273                    -       (3,787)       4,640,326

Stock dividend                            117,150        352,504        (469,654)                   -            -                -

Net income                                      -              -         195,012                    -            -          195,012

Other Comprehensive
 Income - Unrealized
 gains on securities                            -              -               -                    -        7,628            7,628
                                       ----------     ----------     -----------      ---------------     --------      -----------
Balance at
 June 30, 1998                         $1,288,650     $1,240,844     $ 2,309,631      $             -     $  3,841      $ 4,842,966
                                       ==========     ==========     ===========      ===============     ========      ===========
</TABLE>




See Accompanying Notes to Condensed Financial Statements


                                      F-43

<PAGE>   128



                   FIRST AMERICAN BANK OF INDIAN RIVER COUNTY
                       CONDENSED STATEMENTS OF CASH FLOWS



<TABLE>
<CAPTION>
                                                                                                           SIX MONTHS ENDED
                                                                                                               JUNE 30,
                                                                                                   --------------------------------
                                                                                                      1998                  1997
                                                                                                   -----------          -----------
                                                                                                              (Unaudited)
<S>                                                                                                <C>                  <C>        
CASH FLOWS FROM OPERATING ACTIVITIES
    Net income                                                                                     $   195,012          $   175,651
    Adjustments to reconcile net income to net cash
     provided by operating activities:
       Depreciation and amortization                                                                    29,970               31,782
       Discount accretion                                                                               (1,781)              (5,162)
       Provision for loan losses                                                                        65,000               32,500
       Net charge-offs of other real estate owned                                                        9,631                3,500
       Proceeds from sale of loans held for sale                                                       136,583              488,039
       Originations of loans held for sale                                                            (387,952)            (486,650)
       (Increase) decrease in assets:
               Accrued interest receivable                                                             (29,418)              (2,180)
               Other assets                                                                             18,397             (134,303)
       Increase (decrease) in liabilities:
               Accrued interest payable                                                                  8,037               (9,111)
               Accrued expenses and other liabilities                                                  (41,069)             (24,629)
                                                                                                   -----------          -----------
                      Net cash provided by operating activities                                          2,410               69,437
                                                                                                   -----------          -----------
CASH FLOWS FROM INVESTING ACTIVITIES
    Securities available-for-sale:
       Proceeds from maturities                                                                      2,000,000            1,050,000
       Purchases of securities                                                                      (2,497,814)          (1,000,000)
    Securities to be held-to-maturity:
       Purchases of securities                                                                               -               (1,299)
    Net increase in loans                                                                             (175,606)          (2,193,149)
    Proceeds from sale of other real estate owned                                                       35,728               32,285
    Purchase of premises and equipment                                                                       -               (2,033)
                                                                                                   -----------          -----------
                      Net cash used in investing activities                                           (637,692)          (2,114,196)
                                                                                                   -----------          -----------
CASH FLOWS FROM FINANCING ACTIVITIES
    Net increase in deposits                                                                           919,989            2,817,938
    Proceeds from sale of treasury stock                                                                     -               63,522
                                                                                                   -----------          -----------
                      Net cash provided by financing activities                                        919,989            2,881,460
                                                                                                   -----------          -----------
NET INCREASE IN CASH AND CASH EQUIVALENTS                                                              284,707              836,701
CASH AND CASH EQUIVALENTS
    Beginning of period                                                                              7,364,269            3,335,448
                                                                                                   -----------          -----------

    End of period                                                                                  $ 7,648,976          $ 4,172,149
                                                                                                   ===========          ===========

SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION 
    Cash paid during the year for:
       Interest                                                                                    $   738,724          $   681,432
                                                                                                   ===========          ===========
       Income taxes                                                                                $   135,375          $   153,524
                                                                                                   ===========          ===========
</TABLE>




See Accompanying Notes to Condensed Financial Statements


                                      F-44

<PAGE>   129



                   FIRST AMERICAN BANK OF INDIAN RIVER COUNTY
                     NOTES TO CONDENSED FINANCIAL STATEMENTS
                         JUNE 30, 1998 AND JUNE 30, 1997



NOTE A - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

The accounting and reporting policies of First American Bank of Indian River
County (the "Bank") conform to generally accepted accounting principles and to
predominant practices within the banking industry.

In the opinion of the Bank's management, all adjustments necessary to present
fairly the financial position as of June 30, 1998 and June 30, 1997, and the
results of operations and cash flows for the periods then ended have been
included. The results of the periods ended June 30, 1998 are not necessarily an
indication of the results to be expected for the fiscal year ending December 31,
1998.

Certain amounts for 1997 were reclassified to conform with statement
presentation for June 30, 1998 and June 30, 1997. These reclassifications have
no effect on stockholders' equity or net income as previously reported.


NOTE B - RECENT ACCOUNTING DEVELOPMENTS

Sales of Financial Assets:

 The Financial Accounting Standards Board ("FASB") has issued Statement of
 Financial Accounting Standard ("SFAS") No. 125, "Accounting for Transfers and
 Servicing of Financial Assets and Extinguishment of Liabilities," which was
 effective for the fiscal year beginning January 1, 1997. SFAS No. 125 provides
 standards for distinguishing transfers of financial assets that are sales from
 transfers that are secured borrowing. The impact of the adoption of SFAS No.
 125 upon the results of operations of the Bank was not material.

Reporting Comprehensive Income:

 The Bank has adopted SFAS No. 130, "Reporting Comprehensive Income." SFAS No.
 130 establishes standards for reporting and display of comprehensive income and
 its components (revenues, expenses, gains, and losses). The adoption of SFAS
 No. 130 did not have a material effect on the Bank's financial position or
 results of operations.

NOTE C - PENDING MERGER

In July 1998, the Bank entered into a merger agreement with SouthTrust
Corporation (SouthTrust) and SouthTrust Bank, National Association (ST-Bank), a
wholly owned subsidiary of SouthTrust. Basically, the merger agreement provides
that each share of common stock of First American Bank of Indian River County
would be exchanged for 1.887 shares of SouthTrust common stock. Cash will be
paid for fractional shares and for common stock of dissenting shareholders.

The merger is expected to be completed in the fourth quarter of 1998, subject to
approval by the Bank's shareholders and applicable regulatory authorities.







                                      F-45

<PAGE>   130



                   FIRST AMERICAN BANK OF INDIAN RIVER COUNTY
              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                         JUNE 30, 1998 AND JUNE 30, 1997



NOTE D - INCOME TAXES

Federal and State income taxes are provided on income reported for financial
statement purposes and include both current and deferred income tax expense.
Current income tax expense is recorded to reflect income taxes based upon the
tax returns filed with the appropriate taxing agencies. Deferred income taxes
are recorded to reflect the tax consequences on future years of differences
between the tax bases of assets and liabilities and their financial reporting
amounts at year end. The change in deferred taxes attributable to the carrying
value of investments categorized as "available-for-sale" is recognized as a
change in stockholders' equity. The change in deferred income taxes attributable
to all other timing differences is recognized as deferred income tax expense or
benefit. The tax benefit related to operating loss and tax credit carryforwards,
if any, are recognized if management believes, based on available evidence, that
is more likely than not that they will be realized. Investment tax credits, if
any, are accounted for using the flow-through method.


NOTE E - LOANS AND ALLOWANCE FOR LOAN LOSSES

Loans consists of:


<TABLE>
<CAPTION>
                                                                                JUNE 30,            DECEMBER 31,          JUNE 30,
                                                                                  1998                 1997                 1997
                                                                               -----------          -----------          -----------
                                                                               (Unaudited)                               (Unaudited)
<S>                                                                            <C>                  <C>                  <C>        
Real estate mortgage                                                           $18,716,662          $17,970,113          $17,826,254
Real estate construction                                                           807,753              931,710              352,429
Commercial, financial and agriculture                                            3,967,533            4,466,130            4,430,682
Consumer and other                                                               6,917,850            6,568,754            6,794,604
                                                                               -----------          -----------          -----------

                                                                                30,409,798           29,936,707           29,403,969
Less:  Allowance for loan losses                                                   300,577              283,230              276,073
                Deferred loan fees and discounts                                    76,958               70,695               72,258
                                                                               -----------          -----------          -----------

                                                                               $30,032,263          $29,582,782          $29,055,638
                                                                               ===========          ===========          ===========
</TABLE>


An analysis of the activity in the allowance for loan losses follows:


<TABLE>
<CAPTION>
                                                                           6 MOS.                   YEAR                    6 MOS.
                                                                           ENDED                    ENDED                   ENDED
                                                                          JUNE 30,                 DECEMBER                JUNE 30,
                                                                            1998                     31,                    1997
                                                                                                    1997
                                                                          ---------               ---------               ---------
                                                                         (Unaudited)                                     (Unaudited)
<S>                                                                      <C>                      <C>                    <C>      
Balance, beginning of period                                              $ 283,230               $ 268,375               $ 268,375
Provisions charged to expense                                                65,000                 107,500                  32,500
Loans charged off                                                           (48,528)                (98,878)                (25,302)
Recoveries                                                                      875                   6,233                     500
                                                                          ---------               ---------               ---------

Balance, end of period                                                    $ 300,577               $ 283,230               $ 276,073
                                                                          =========               =========               =========
</TABLE>






                                      F-46

<PAGE>   131



                   FIRST AMERICAN BANK OF INDIAN RIVER COUNTY
              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                         JUNE 30, 1998 AND JUNE 30, 1997



NOTE F - ACCUMULATED OTHER COMPREHENSIVE INCOME

Effective December 31, 1993, the Bank adopted the investment categorization and
carrying rules as required by Financial Accounting Standards Board Statement of
Financial Accounting Standards No. 115 (FASB No. 115), Accounting for Certain
Investment in Debt and Equity Securities. Under this statement, the unrealized
gain or loss on investment securities available for sale, net of the applicable
deferred income taxes, is shown as a separate component of stockholders' equity
in the balance sheet. The following is a summary of the effects of the statement
of stockholders' equity as of June 30, 1998, December 31, 1997, and June 30,
1997.


<TABLE>
<CAPTION>
                                                                            JUNE 30,         DECEMBER 31        JUNE 30,
                                                                             1998               1997              1997
                                                                          -----------        -----------       -----------
                                                                          (Unaudited)                          (Unaudited)
<S>                                                                       <C>                <C>               <C>         
Gross unrealized gains (losses) on investment
  securities available-for-sale                                           $     5,820        $    (6,036)      $   (36,960)
Deferred income tax liability on
  unrealized gains (losses)                                                    (1,979)             2,249            12,566
                                                                          -----------        -----------       -----------
               Net increase decrease in accumulated                       $     3,841        $    (3,787)      $   (24,394)
                 other comprehensive income                               ===========        ===========       ===========
                                                                      
</TABLE>


NOTE G - PREMISES AND EQUIPMENT

A summary of premises and equipment is as follows:


<TABLE>
<CAPTION>
                                                                            JUNE 30,              DECEMBER 31            JUNE 30,
                                                                             1998                    1997                 1997
                                                                          -----------             -----------          -----------
                                                                          (Unaudited)                                  (Unaudited)
<S>                                                                       <C>                     <C>                  <C>         
Land                                                                      $   327,914             $   327,914          $   327,914
Building                                                                      408,574                 408,574              408,575
Furniture and equipment                                                       415,210                 415,210              414,087
Vehicles                                                                       15,759                  15,759               15,759
                                                                          -----------             -----------          -----------
                                                                            1,167,457               1,167,457            1,166,335
Less, accumulated depreciation                                                571,158                 541,188              510,269
                                                                          -----------             -----------          -----------

                      Net premises and equipment                          $   596,299             $   626,269          $   656,066
                                                                          ===========             ===========          ===========
</TABLE>


NOTE H - STOCK OPTION PLAN

The Bank also has an incentive stock option plan for officers and employees
under its Key Employees' Stock Option Plan (the "Plan"). Under the Plan the
total number of shares which may be issued may not exceed 20% (currently 25,773
shares) of the Bank's total outstanding shares. At June 30, 1998, 11,473 such
options remained available for grant and 14,300 had been granted, but not yet
exercised, at a price of $36 per share.





                                      F-47

<PAGE>   132


                   FIRST AMERICAN BANK OF INDIAN RIVER COUNTY
              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                         JUNE 30, 1998 AND JUNE 30, 1997


A summary of the year of expiration of these options is as follows:


<TABLE>
<CAPTION>
         Options Granted                             Expiration
          and Unexercised                               Date
     -------------------------                  -----------------------
     <S>                                        <C>  
           5,500                                       2,002
           8,800                                       2,007
</TABLE>

In July 1998, the unexercised option on 8,800 shares of Common Stock expiring in
2007 were cancelled.

NOTE I - EARNINGS PER SHARE

Net income per common share has been computed by dividing net income by the
weighted average common shares outstanding during the periods. Net income per
common shares represents basic per share information.

NOTE J - YEAR 2000 ISSUE

The Bank is in the process of evaluating and implementing changes to its
computer systems and applications necessary to achieve a year 2000 conversion.
These changes are necessary to ensure that the computer system and applications
will properly recognize and process information for the year 2000 and beyond.
The total cost of conversion and its effects on the results of operations is
being determined as part of the evaluation process.







                                      F-48
<PAGE>   133
                                                                      EXHIBIT A







                          AGREEMENT AND PLAN OF MERGER

                                       OF

                     SOUTHTRUST BANK, NATIONAL ASSOCIATION

                                      AND

                              FIRST AMERICAN BANK
                             OF INDIAN RIVER COUNTY

                                  JOINED IN BY

                             SOUTHTRUST CORPORATION


                                      A-i
<PAGE>   134


<TABLE>
<S>      <C>               <C>                                                                                 <C>   
ARTICLE I

         THE MERGER

         Section 1.1       Consummation of Merger; Closing Date.................................................A-1

         Section 1.2       Effect of Merger.....................................................................A-2

         Section 1.3       Further Assurances...................................................................A-2
                           
         Section 1.4       Directors and Officers...............................................................A-2
                           

ARTICLE II

         CONVERSION OF CONSTITUENTS' CAPITAL SHARES

         Section 2.1       Manner of Conversion of the Bank Shares..............................................A-2
                           
         Section 2.2       Bank Stock Options and Related Matters...............................................A-3
                           
         Section 2.3       Fractional Shares....................................................................A-4
                           
         Section 2.4       Effectuating Conversion..............................................................A-4
                           
         Section 2.5       Laws of Escheat......................................................................A-6
                           

ARTICLE III

         REPRESENTATIONS AND WARRANTIES OF THE BANK

         Section 3.1       Corporate Organization...............................................................A-6
                           
         Section 3.2       Capitalization.......................................................................A-6
                           
         Section 3.3       Financial Statements; Filings........................................................A-6
                           
         Section 3.4       Loan Portfolio; Reserves.............................................................A-7
                           
         Section 3.5       Certain Loans and Related Matters....................................................A-8
                           
         Section 3.6       Authority; No Violation..............................................................A-8
                           
         Section 3.7       Consents and Approvals...............................................................A-8
                           
         Section 3.8       Broker's Fees........................................................................A-8
                           
         Section 3.9       Absence of Certain Changes or Events.................................................A-9
                           
         Section 3.10      Legal Proceedings; Etc...............................................................A-9
                           
         Section 3.11      Taxes and Tax Returns................................................................A-9
                           
         Section 3.12      Employee Benefit Plans...............................................................A-9
                           
         Section 3.13      Title and Related Matters...........................................................A-10
                           
         Section 3.14      Real Estate.........................................................................A-11
                           
         Section 3.15      Environmental Matters...............................................................A-11
                           
         Section 3.16      Commitments and Contracts...........................................................A-12
                           
         Section 3.17      Regulatory Matters..................................................................A-12
                           
         Section 3.18      Registration Obligations............................................................A-12
                           
         Section 3.19      State Takeover Laws.................................................................A-12
                           
         Section 3.20      Insurance...........................................................................A-12
                           
         Section 3.21      Labor...............................................................................A-12
                           
         Section 3.22      Compliance with Laws................................................................A-12
                           
         Section 3.23      Transactions with Management........................................................A-13
                           
         Section 3.24      Derivative Contracts................................................................A-13
                           
         Section 3.25      Deposits............................................................................A-13
                           
         Section 3.26      Accounting Controls.................................................................A-13
                           
         Section 3.27      Proxy Materials.....................................................................A-13
                           
         Section 3.28      Deposit Insurance...................................................................A-13

         Section 3.29      Untrue Statements and Omissions.....................................................A-14

         Section 3.30      Year 2000...........................................................................A-14
</TABLE>


                                      A-ii
<PAGE>   135

<TABLE>

<S>      <C>               <C>                                                                                 <C>   
ARTICLE IV

         REPRESENTATIONS AND WARRANTIES OF
         SOUTHTRUST AND ST-BANK

         Section 4.1       Organization and Related Matters of SouthTrust......................................A-14
                           
         Section 4.2       Organization and Related Matters of ST-Bank.........................................A-14
                           
         Section 4.3       Capitalization......................................................................A-15
                           
         Section 4.4       Authorization.......................................................................A-15
                           
         Section 4.5       Financial Statements................................................................A-15
                           
         Section 4.6       Absence of Certain Changes or Events................................................A-15
                           
         Section 4.7       Legal Proceedings, Etc..............................................................A-16
                           
         Section 4.8       Insurance...........................................................................A-16
                           
         Section 4.9       Consents and Approvals..............................................................A-16
                           
         Section 4.10      Accounting, Tax, Regulatory Matters.................................................A-16
                           
         Section 4.11      Proxy Materials.....................................................................A-16
                           
         Section 4.12      No Broker's or Finder's Fees........................................................A-16
                           
         Section 4.13      Untrue Statements and Omissions.....................................................A-16
                           
         Section 4.14      SEC Filings.........................................................................A-16
                           

ARTICLE V

         COVENANTS AND AGREEMENTS

         Section 5.1       Conduct of the Business of the Bank.................................................A-17
                           
         Section 5.2       Current Information.................................................................A-18
                           
         Section 5.3       Access to Properties; Personnel and Records.........................................A-18
                           
         Section 5.4       Approval of the Bank Shareholders...................................................A-19
                           
         Section 5.5       No Other Bids.......................................................................A-19
                           
         Section 5.6       Notice of Deadlines.................................................................A-19
                           
         Section 5.7       Affiliates..........................................................................A-19
                           
         Section 5.8       Maintenance of Properties...........................................................A-20
                           
         Section 5.9       Environmental Audits................................................................A-20
                           
         Section 5.10      Title Insurance.....................................................................A-20
                           
         Section 5.11      Surveys.............................................................................A-20
                           
         Section 5.12      Compliance Matters..................................................................A-20
                           
         Section 5.13      Exemption Under Anti-Takeover Statutes..............................................A-20
                           

ARTICLE VI

         ADDITIONAL COVENANTS AND AGREEMENTS

         Section 6.1       Best Efforts; Cooperation...........................................................A-20
                           
         Section 6.2       Regulatory Matters..................................................................A-20
                           
         Section 6.3       Other Matters.......................................................................A-21
                           
         Section 6.4       Indemnification.....................................................................A-21
                           
         Section 6.5       Current Information.................................................................A-22
                           
         Section 6.6       Registration Statement..............................................................A-22
                           
         Section 6.7       Reservation of Shares...............................................................A-23
                           
         Section 6.8       Consideration.......................................................................A-23
                           
         Section 6.9       Advisory Board......................................................................A-23
                           
         Section 6.10      ST-Bank Shareholder Approval........................................................A-23
                           
</TABLE>


                                     Aiii
<PAGE>   136

<TABLE>

<S>      <C>               <C>                                                                                 <C>    
ARTICLE VII

         MUTUAL CONDITIONS TO CLOSING

         Section 7.1       Shareholder Approval................................................................A-23
                           
         Section 7.2       Regulatory Approvals................................................................A-23
                           
         Section 7.3       Legal Proceedings...................................................................A-23
                           
         Section 7.4       Proxy Statement and Registration Statement..........................................A-23
                           

ARTICLE VIII

         CONDITIONS TO THE OBLIGATIONS OF SOUTHTRUST AND ST-BANK

         Section 8.1       Representations and Warranties......................................................A-24
                           
         Section 8.2       Performance of Obligations..........................................................A-24
                           
         Section 8.3       Certificate Representing Satisfaction of Conditions.................................A-24
                           
         Section 8.4       Absence of Adverse Facts............................................................A-24
                           
         Section 8.5       Opinion of Counsel..................................................................A-24
                           
         Section 8.6       Consents Under Agreements...........................................................A-24
                           
         Section 8.7       Material Condition..................................................................A-24
                           
         Section 8.8       Matters Relating to Employment Agreements...........................................A-24
                           
         Section 8.9       Outstanding Shares of the Bank......................................................A-24
                           
         Section 8.10      Dissenters..........................................................................A-25
                           
         Section 8.11      Certification of Claims.............................................................A-25
                           
         Section 8.12      Pooling.............................................................................A-25
                           
         Section 8.13      Signs...............................................................................A-25
                           

ARTICLE IX

         CONDITIONS TO OBLIGATIONS OF THE BANK

         Section 9.1       Representations and Warranties......................................................A-25
                           
         Section 9.2       Performance of Obligations..........................................................A-25
                           
         Section 9.3       Certificate Representing Satisfaction of Conditions.................................A-25
                           
         Section 9.4       Absence of Adverse Facts............................................................A-25
                           
         Section 9.5       Consents Under Agreements...........................................................A-25
                           
         Section 9.6       Opinion of Counsel..................................................................A-26
                           
         Section 9.7       SouthTrust Shares...................................................................A-26
                           
         Section 9.8       Tax Opinion.........................................................................A-26
                           
         Section 9.9       Fairness Opinion....................................................................A-26
                           
         Section 9.10      NASDAQ Listing......................................................................A-26
                           

ARTICLE X

         TERMINATION, WAIVER AND AMENDMENT

         Section 10.1      Termination.........................................................................A-26
                           
         Section 10.2      Effect of Termination; Break-Up Fee.................................................A-28
                           
         Section 10.3      Amendments..........................................................................A-29
                           
         Section 10.4      Waivers.............................................................................A-29
                           
         Section 10.5      Non-Survival of Representations and Warranties......................................A-29
</TABLE>


                                      A-iv
<PAGE>   137

<TABLE>

<S>      <C>               <C>                                                                                 <C>    
ARTICLE XI

         MISCELLANEOUS

         Section 11.1      Entire Agreement....................................................................A-29
                           
         Section 11.2      Definitions.........................................................................A-29
                           
         Section 11.3      Notices.............................................................................A-30
                           
         Section 11.4      Severability........................................................................A-31
                           
         Section 11.5      Costs and Expenses..................................................................A-31
                           
         Section 11.6      Captions............................................................................A-31
                           
         Section 11.7      Counterparts........................................................................A-31
                           
         Section 11.8      Governing Law.......................................................................A-31
                           
         Section 11.9      Persons Bound; No Assignment........................................................A-31
                           
         Section 11.10     Exhibits and Schedules..............................................................A-31
                           
         Section 11.11     Waiver..............................................................................A-31
                           
         Section 11.12     Construction of Terms...............................................................A-31
</TABLE>


                                      A-v
<PAGE>   138
 
                          AGREEMENT AND PLAN OF MERGER
                                       OF
                     SOUTHTRUST BANK, NATIONAL ASSOCIATION
                                      AND
                             FIRST AMERICAN BANK OF
                              INDIAN RIVER COUNTY
                                  JOINED IN BY
                             SOUTHTRUST CORPORATION



                  This AGREEMENT AND PLAN OF MERGER, dated as of the 1st day of
July, 1998 (this "Agreement"), by and between SouthTrust Bank, National
Association, a national banking association ("ST-Bank"), and First American
Bank of Indian River County, a Florida banking corporation (the "Bank"), and
joined in by SouthTrust Corporation, a Delaware corporation ("SouthTrust").


                                WITNESSETH THAT:


                  WHEREAS, the respective Boards of Directors of ST-Bank and
the Bank deem it in the best interests of ST-Bank and of the Bank,
respectively, and of their respective shareholders, that ST-Bank and the Bank
merge pursuant to this Agreement in a transaction that qualifies as a
reorganization pursuant to Section 368(a) of the Internal Revenue Code of 1986
(the "Code") (the "Merger");

                  WHEREAS, the Boards of Directors of ST-Bank and the Bank have
approved this Agreement and have directed that this Agreement be submitted to
their respective shareholders for approval and adoption in accordance with
applicable law; and

                  WHEREAS, SouthTrust, the sole shareholder of ST-Bank, will
deliver, or cause to be delivered, to the shareholders of the Bank the
consideration to be paid pursuant to the Merger in accordance with the terms of
this Agreement;

                  NOW, THEREFORE, in consideration of the premises and the
mutual covenants, representations, warranties and agreements herein contained,
the parties agree that the Bank will be merged with and into ST-Bank and that
the terms and conditions of the Merger, the mode of carrying the Merger into
effect, including the manner of converting the shares of common stock of the
Bank into shares of common stock of SouthTrust, shall be as hereinafter set
forth.


                                   ARTICLE I

                                   THE MERGER


         Section 1.1       Consummation of Merger; Closing Date. Subject to the
provisions hereof, the Bank shall be merged with and into ST-Bank (which has
heretofore and shall hereinafter be referred to as the "Merger") pursuant to
Sections 655.412 and 658.40 through 658.45 of the Florida Code and 12 U.S.C.
ss. 215a and ST-Bank shall be the surviving corporation (sometimes hereinafter
referred to as "Surviving Corporation" when reference is made to it after the
Effective Time of the Merger (as defined below)). The Merger shall become
effective on the date and at the time on which the Merger is deemed effective
by each of the Office of the Comptroller Department of Banking and Finance of
the State of Florida (the "Department") and the Office of the Comptroller of
the Currency (the "OCC") (such time is hereinafter referred to as the
"Effective Time of the Merger"). Subject to the terms and conditions hereof,
unless otherwise agreed upon by SouthTrust and the Bank, the Effective Time of
the Merger shall occur on the first business day following the later to occur
of (i) the effective date (including expiration of any applicable waiting
period) of the last required Consent (as defined below) of any Regulatory
Authority (as defined below) having authority over the transactions
contemplated under the Merger Agreement and (ii) the date on which the
shareholders of the Bank, to the extent that their approval is required by
applicable law, approve the transactions contemplated by this Agreement.

                  (a)      The closing of the Merger (the "Closing") shall take
place at the principal offices of the Bank at 10:00 a.m. local time on the day
that the Effective Time of the Merger occurs, or such other date and time and
place as the parties hereto may agree (the "Closing Date"). Subject to the
provisions of this Agreement, at the Closing there


                                      A-1
<PAGE>   139

shall be delivered to each of the parties hereto the opinions, certificates and
other documents and instruments required to be so delivered pursuant to this
Agreement.

         Section 1.2       Effect of Merger. At the Effective Time of the 
Merger, the Bank shall be merged with and into ST-Bank and the separate
existence of the Bank shall cease. The Certificate or Articles of Incorporation
and Bylaws of ST-Bank, as in effect on the date hereof and as otherwise amended
prior to the Effective Time of the Merger, shall be the Certificate or Articles
of Incorporation and the Bylaws of the Surviving Corporation until further
amended as provided therein and in accordance with applicable law. The
Surviving Corporation shall have all the rights, privileges, immunities and
powers and shall be subject to all the duties and liabilities of a corporation
organized under the laws of its state of incorporation and shall thereupon and
thereafter possess all other privileges, immunities and franchises of a
private, as well as of a public nature, of each of the constituent
corporations. All property (real, personal and mixed) and all debts on whatever
account, including subscriptions to shares, and all choses in action, all and
every other interest, of or belonging to or due to each of the constituent
corporations so merged shall be taken and deemed to be transferred to and
vested in the Surviving Corporation without further act or deed. The title to
any real estate, or any interest therein, vested in any of the constituent
corporations shall not revert or be in any way impaired by reason of the
Merger. The Surviving Corporation shall thenceforth be responsible and liable
for all the liabilities and obligations of each of the constituent corporations
so merged and any claim existing or action or proceeding pending by or against
either of the constituent corporations may be prosecuted as if the Merger had
not taken place or the Surviving Corporation may be substituted in its place.
Neither the rights of creditors nor any liens upon the property of any
constituent corporation shall be impaired by the Merger.

         Section 1.3       Further Assurances. From and after the Effective Time
of the Merger, as and when requested by the Surviving Corporation, the officers
and directors of the Bank last in office shall execute and deliver or cause to
be executed and delivered in the name of the Bank such deeds and other
instruments and take or cause to be taken such further or other actions as
shall be necessary in order to vest or perfect in or confirm of record or
otherwise to the Surviving Corporation title to and possession of all of the
property, interests, assets, rights, privileges, immunities, powers, franchises
and authority of the Bank.

         Section 1.4       Directors and Officers. From and after the Effective 
Time of the Merger, the directors of the Surviving Corporation and the officers
of the Surviving Corporation shall be those persons serving as directors and
officers of ST-Bank immediately prior to the Effective Time of the Merger, and
such additional persons, in each case, as SouthTrust, at or prior to the
Effective Time of the Merger, shall designate in writing.


                                   ARTICLE II

                   CONVERSION OF CONSTITUENTS' CAPITAL SHARES


         Section 2.1       Manner of Conversion of the Bank Shares. Subject to 
the provisions hereof, as of the Effective Time of the Merger and by virtue of
the Merger and without any further action on the part of SouthTrust, the Bank,
or ST-Bank, or any of their shareholders, the shares of the constituent
corporations shall be converted as follows:

         (a)      Each share of capital stock of ST-Bank outstanding
                  immediately prior to the Effective Time of the Merger shall,
                  after the Effective Time of the Merger, remain outstanding
                  and unchanged and thereafter shall constitute all of the
                  issued and outstanding shares of capital stock of the
                  Surviving Corporation.

         (b)      Each share of common stock of the Bank (the "Bank Shares")
                  held by the Bank or SouthTrust (or any of their
                  subsidiaries), other than in a fiduciary capacity or as a
                  result of debts previously contracted, shall be canceled and
                  retired and no consideration shall be paid or delivered in
                  exchange therefor.

         (c)      Subject to the terms and conditions of this Agreement,
                  including, without limitation, Section 2.3 hereof and except
                  with regard to Dissenting Bank Shares (as hereinafter
                  defined) and the Bank Shares excluded in 2.1(b) above, each
                  Bank Share outstanding immediately prior to the Effective
                  Time of the Merger shall be converted into the right to
                  receive that number of shares of common stock of SouthTrust
                  (and the rights associated therewith issued pursuant to a
                  Rights Agreement dated February 22, 1989 between SouthTrust
                  and Mellon Bank, N.A.) (together, the "SouthTrust Shares") as
                  results from (i) dividing $10,000,000.00 by the Average
                  Closing Price (as defined herein) as of June 26, 1998 and
                  then (ii)


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<PAGE>   140

                  dividing the quotient obtained in (i) by the total number of
                  issued and outstanding Bank Shares and (iii) rounding down
                  the resulting number to the nearest thousandth of a whole
                  number (such number, as may be adjusted as provided herein,
                  being hereinafter referred to as the "Conversion Ratio"). The
                  Conversion Ratio, including the aggregate number of
                  SouthTrust Shares issuable in the Merger, shall be subject to
                  an appropriate adjustment in the event of any stock split,
                  reverse stock split, dividend payable in SouthTrust Shares,
                  reclassification or similar distribution whereby SouthTrust
                  issues SouthTrust Shares or any securities convertible into
                  or exchangeable for SouthTrust Shares without receiving any
                  consideration in exchange therefor, provided that the record
                  date of such transaction is a date after the date of the
                  Agreement and prior to the Effective Time of the Merger.

         (d)      Each outstanding Bank Share, the holder of which has demanded 
                  and perfected such holder's demand for payment of the "fair
                  or appraised" value of such share in accordance with Section
                  658.44 of the Florida Code (the "Dissent Provisions"), to the
                  extent applicable, and has not effectively withdrawn or lost
                  such holder's right to such appraisal (the "Dissenting Bank
                  Shares"), shall not be converted into or represent a right to
                  receive the SouthTrust Shares issuable in the Merger but the
                  holder thereof shall be entitled only to such rights as are
                  granted by the Dissent Provisions. The Bank shall give
                  SouthTrust prompt notice upon receipt by the Bank of any
                  written objection to the Merger and any written demand for
                  payment of the fair or appraised value of any Bank Shares,
                  and of withdrawals of such demands, and any other instrument
                  provided to the Bank pursuant to the Dissent Provisions (any
                  shareholder duly making such demand being hereinafter called
                  a "Dissenting Shareholder"). Each Dissenting Shareholder who
                  becomes entitled, pursuant to the Dissent Provisions, to
                  payment of fair or appraised value for any Bank Share held by
                  such Dissenting Shareholder shall receive payment therefor
                  from the Surviving Corporation, as escrow agent (the "Escrow
                  Agent"), on behalf of the Bank out of funds provided to the
                  Escrow Agent by the Bank in accordance with the provisions of
                  Section 2.1(e) (but only after the amount thereof shall have
                  been agreed upon or at the times and in the amounts required
                  by the Dissent Provisions) and all of the Bank Shares held by
                  such Dissenting Shareholder shall be canceled. Neither the
                  Bank nor the Surviving Corporation shall, except with the
                  prior written consent of SouthTrust, voluntarily make any
                  payment with respect to, or settle or offer to settle, any
                  demand for payment by any Dissenting Shareholder. If any
                  Dissenting Shareholder shall have failed to perfect or shall
                  have effectively withdrawn or lost such right to demand
                  payment of fair or appraised value, the Bank Shares held by
                  such Dissenting Shareholder shall thereupon be deemed to have
                  been converted into the right to receive the consideration to
                  be issued in the Merger as provided by this Agreement.

         (e)      With respect to each Dissenting Shareholder, on or immediately
                  prior to the Effective Time of the Merger, the Bank shall
                  deposit with the Escrow Agent an amount in cash equal to 150%
                  of the consideration (with the SouthTrust Shares being valued
                  in the manner set forth in Section 2.3) such Dissenting
                  Shareholder would have received in the Merger, but for the
                  exercise of the Dissent Provisions (the "Dissent Escrow").
                  The Escrow Agent shall disburse the Dissent Escrow to such
                  Dissenting Shareholders in accordance with the Dissent
                  Provisions. Any and all funds remaining in the Dissent Escrow
                  after such disbursement shall be remitted to the Surviving
                  Corporation.

         Section 2.2       Bank Stock Options and Related Matters. (a) As of the
Effective Time of the Merger, all rights with respect to Bank Shares issuable
pursuant to the exercise of stock options (the "Bank Options") granted by the
Bank under stock option plans of the Bank (the "Bank Stock Option Plans"),
which are outstanding at the Effective Time of the Merger, whether or not such
Bank Options are then exercisable, shall, subject to this section, be assumed
by SouthTrust in accordance with the terms of the particular Bank Stock Option
Plan under which such Bank Options were issued and the stock option agreement
by which such Bank Options are evidenced. From and after the Effective Time of
the Merger, (i) each Bank Option assumed by SouthTrust hereunder may be
exercised solely for SouthTrust Shares, (ii) the number of SouthTrust Shares
subject to such Bank Option shall be equal to the number of Bank Shares


                                      A-3
<PAGE>   141

subject to such Bank Option immediately prior to the Effective Time of the
Merger multiplied by the Conversion Ratio and (iii) the per share exercise
price under each such Bank Option shall be adjusted by dividing the per share
exercise price under each such Bank Option by the Conversion Ratio and rounding
down to the nearest cent.

                  (b)      At all times after the Effective Time of the Merger,
SouthTrust shall reserve for issuance such number of SouthTrust Shares as shall
be necessary to permit the exercise of Bank Options in the manner contemplated
by this Agreement. At or (at the election of SouthTrust) within a reasonable
time after the Effective Time of the Merger, SouthTrust shall file a
Registration Statement on Form S-3 or Form S-8, as the case may be (or any
successor or other appropriate form) (the "Registration Statement"), with
respect to the SouthTrust Shares subject to Bank Options and shall use its best
efforts to maintain the effectiveness of such registration statement or
registration statements (and maintain the current status of the prospectus or
prospectuses contained therein) for so long as any Bank Options remain
outstanding. SouthTrust shall make any filings required under any applicable
state securities laws to qualify the SouthTrust Shares subject to such Bank
Options for resale thereunder.

                  (c)      The number of SouthTrust Shares subject to Bank 
Options to be assumed by SouthTrust hereunder and the exercise price thereof
shall, from and after the Effective Time of the Merger, be subject to
appropriate adjustment in the event of the occurrence of any transaction
described in Section 2.1(c) hereof if the record date with respect to such
transaction is on or after the Effective Time of the Merger.

                  (d)      It is intended that the foregoing assumption of Bank
Options shall be undertaken in a manner that will not constitute a
"modification" as defined in Section 424 of the Code as to any stock option
which is an incentive stock option as defined in Section 422 of the Code. All
restrictions or limitations on transfer with respect to Bank Shares awarded
under a Bank Stock Option Plan ("Restricted Stock"), to the extent that such
restrictions or limitations shall not have already lapsed, and except as
otherwise provided by such Bank Stock Plan, shall remain in full force and
effect with respect to the SouthTrust Shares into which such Restricted Stock
is converted pursuant to this Agreement, unless such restrictions arise under
the Securities Act of 1933 and are eliminated by virtue of the Registration
Statements described in this Agreement. Except as otherwise provided herein,
(i) no additional options to purchase shares of capital stock of the Bank will
be granted pursuant to Bank Stock Option Plans following the Effective Time of
the Merger and (ii) the Bank shall take all reasonable steps to ensure that
following the Effective Time of the Merger no holder of Bank Options shall have
any right thereunder to acquire any equity securities of the Bank.

                  (e)      The Bank acknowledges that the holders of Bank 
Options who may become or be deemed to be executive officers or directors of
SouthTrust after the Effective Time of the Merger may be subject to the
short-swing sale restrictions of the Securities Exchange Act of 1934 and
regulations promulgated thereunder.

                  (f)      At the election of SouthTrust, the Bank shall procure
from each holder of Bank Options, and shall deliver to SouthTrust at the
Closing, an executed acknowledgment of the treatment and disposition of such
holder's Bank Options, as provided for under Section 2.2 of this Agreement.

         Section 2.3       Fractional Shares. Notwithstanding any other
provision of this Agreement, each holder of Bank Shares converted pursuant to
the Merger, and each holder of Bank Options assumed by SouthTrust pursuant to
this Agreement, who would otherwise have been entitled to receive a fraction of
a SouthTrust Share shall receive, in lieu thereof, cash (without interest) in
an amount equal to such fractional part of such SouthTrust Share, multiplied by
the market value of one SouthTrust Share at the Effective Time of the Merger in
the case of shares exchanged pursuant to the Merger or at the date of exercise
in the case of the Bank Options to be exercised for SouthTrust Shares. The
market value of one SouthTrust Share at the Effective Time of the Merger or the
date of exercise of Bank Options, as the case may be, shall be the last sales
price of such SouthTrust Shares, as reported by NasDaq-National Market System
("NASDAQ") on the last business day preceding the Effective Time of the Merger
or the date of exercise, as the case may be, or, if the SouthTrust Shares
hereafter become listed for trading on any national securities exchange
registered under the Securities Exchange Act of 1934, the last sales price of
such SouthTrust Shares on the applicable date as reported on the principal
securities exchange on which the SouthTrust Shares are then listed for trading.
No such holder will be entitled to dividends, voting rights or any other rights
as a shareholder in respect of any fractional share.

         Section 2.4       Effectuating Conversion. (a) SouthTrust shall
designate such institution as it may select, including SouthTrust or one of its
affiliates, to serve as the exchange agent (the "Exchange Agent") pursuant to
this Agreement. The Exchange Agent may employ sub-agents in connection with
performing its duties. As of the Effective Time of the Merger, SouthTrust will
deliver or cause to be delivered to the Exchange Agent the consideration to be
paid by SouthTrust for the Bank Shares, along with the appropriate cash payment
in lieu of fractional interests in SouthTrust Shares. As promptly as
practicable after the Effective Time of the Merger, the Exchange Agent shall
send or cause to be sent to each former holder of record of the Bank Shares
transmittal materials (the "Letter of Transmittal") for use


                                      A-4
<PAGE>   142

in exchanging their certificates formerly representing the Bank Shares for the
consideration provided for in this Agreement. The Letter of Transmittal will
contain instructions with respect to the surrender of certificates representing
the Bank Shares and the receipt of the consideration contemplated by this
Agreement and will require each holder of Bank Shares to transfer good and
marketable title to such Bank Shares to SouthTrust, free and clear of all
liens, claims and encumbrances. Amounts that would have been payable to
Dissenting Shareholders for Bank Shares but for the fact of their dissent in
accordance with the provisions of Section 2.1(d) hereof shall be returned by
the Exchange Agent to SouthTrust as promptly as is practicable.

                  (b)      At the Effective Time of the Merger, the stock
transfer books of the Bank shall be closed as to holders of Bank Shares
immediately prior to the Effective Time of the Merger and no transfer of Bank
Shares by any such holder shall thereafter be made or recognized and each
outstanding certificate formerly representing the Bank Shares shall, without
any action on the part of any holder thereof, no longer represent the Bank
Shares. If, after the Effective Time of the Merger, certificates are properly
presented to the Exchange Agent, such certificates shall be exchanged for the
consideration contemplated by this Agreement into which the Bank Shares
represented thereby were converted in the Merger.

                  (c)      In the event that any holder of the Bank Shares is
unable to deliver the certificate which represents such holder's Bank Shares,
SouthTrust, in the absence of actual notice that any Bank Shares theretofore
represented by any such certificate have been acquired by a bona fide
purchaser, may, in its discretion, deliver to such holder the consideration
contemplated by this Agreement and the amount of cash representing fractional
SouthTrust Shares to which such holder is entitled in accordance with the
provisions of this Agreement upon the presentation of all of the following:

                  (i)      An affidavit or other evidence to the reasonable
                           satisfaction of SouthTrust that any such certificate
                           has been lost, wrongfully taken or destroyed;

                  (ii)     Such security or indemnity, including a bond, as may
                           be requested by SouthTrust or SouthTrust's transfer
                           agent, to indemnify and hold SouthTrust (and/or such
                           transfer agent) harmless; and

                  (iii)    Evidence to the satisfaction of SouthTrust that such
                           holder is the owner of the Bank Shares theretofore
                           represented by each certificate claimed by such
                           holder to be lost, wrongfully taken or destroyed and
                           that such holder is the person who would be entitled
                           to present each such certificate for exchange
                           pursuant to this Agreement.

                  (d)      In the event that the delivery of the consideration
contemplated by this Agreement and the amount of cash representing fractional
SouthTrust Shares are to be made to a person other than the person in whose
name any certificate representing the Bank Shares surrendered is registered,
such certificate so surrendered shall be properly endorsed (or accompanied by
an appropriate instrument of transfer), with the signature(s) appropriately
guaranteed, and otherwise in proper form for transfer, and the person
requesting such delivery shall pay any transfer or other taxes required by
reason of the delivery to a person other than the registered holder of such
certificate surrendered or establish to the satisfaction of SouthTrust that
such tax has been paid or is not applicable.

                  (e)      No holder of Bank Shares shall be entitled to receive
any dividends or distributions declared or made with respect to the SouthTrust
Shares with a record date before the Effective Time of the Merger. After the
Effective Time of the Merger, and until properly surrendered and exchanged
pursuant to this Agreement, each outstanding certificate representing Bank
Shares, subject to this Section 2.4(e) shall be deemed to represent and
evidence for all corporate purposes only the right to receive the consideration
into which such Bank Shares were converted as of the Effective Time of the
Merger. Accordingly, among other matters, neither the consideration
contemplated by this Agreement, any amount of cash representing fractional
SouthTrust Shares nor any dividend or other distribution with respect to
SouthTrust Shares where the record date thereof is on or after the Effective
Time of the Merger shall be paid, and SouthTrust shall not be obligated to pay,
to the holder of any unsurrendered certificate or certificates representing the
Bank Shares until such holder shall surrender the certificate or certificates
representing the Bank Shares as provided for by the Agreement, and until such
holder becomes the record holder of the SouthTrust Shares issuable in the
Merger, such holder shall not be entitled to vote such SouthTrust Shares in
respect of any matter coming before the stockholders of SouthTrust. Subject to
applicable laws, following surrender of any such certificate or certificates,
there shall be paid


                                      A-5
<PAGE>   143

to the holder of the certificate or certificates then representing SouthTrust
Shares issued in the Merger, without interest at the time of such surrender,
the consideration contemplated by this Agreement, the amount of any cash
representing fractional SouthTrust Shares and the amount of any dividends or
other distributions with respect to SouthTrust Shares to which such holder is
entitled as a holder of SouthTrust Shares.

         Section 2.5       Laws of Escheat. If any of the consideration due or 
other payments to be paid or delivered to the holders of Bank Shares is not
paid or delivered within the time period specified by any applicable laws
concerning abandoned property, escheat or similar laws, and if such failure to
pay or deliver such consideration occurs or arises out of the fact that such
property is not claimed by the proper owner thereof, SouthTrust or the Exchange
Agent shall be entitled to dispose of any such consideration or other payments
in accordance with applicable laws concerning abandoned property, escheat or
similar laws. Any other provision of this Agreement notwithstanding, none of
the Bank, SouthTrust, ST-Bank, the Exchange Agent, nor any other person acting
on their behalf shall be liable to a holder of Bank Shares for any amount paid
or property delivered in good faith to a public official pursuant to and in
accordance with any applicable abandoned property, escheat or similar law.


                                  ARTICLE III

                   REPRESENTATIONS AND WARRANTIES OF THE BANK


         The Bank hereby represents and warrants to ST-Bank and SouthTrust as
follows as of the date hereof and as of all times up to and including the
Effective Time of the Merger (except as otherwise provided):

         Section 3.1       Corporate Organization. (a) The Bank is a banking
corporation duly organized, validly existing and in good standing under the
laws of the State of Florida. The Bank has the corporate power and authority to
own or lease all of its properties and assets and to carry on its business as
such business is now being conducted, and the Bank is duly licensed or
qualified to do business in each state or other jurisdiction in which the
nature of the business conducted by it or the character or location of the
properties and assets owned or leased by it makes such licensing or
qualification necessary, except where the failure to be so licensed or
qualified would not have a Material Adverse Effect on the Bank. True and
correct copies of the Certificate or Articles of Incorporation and the Bylaws
of the Bank, as amended to the date hereof, have been delivered to SouthTrust.

                  (b)      The Bank has in effect all federal, state, local and
foreign governmental, regulatory and other authorizations, permits and licenses
necessary for it to own or lease its properties and assets and to carry on its
business as now conducted, except for authorizations, permits and licenses, the
absence of which, either individually or in the aggregate, would not have a
Material Adverse Effect on the Bank.

                  (c)      The Bank does not own any capital stock of any
subsidiary, or have any interest in any partnership or joint venture; for
purposes of this Agreement, a "subsidiary" means any corporation or other
entity of which the party referred to beneficially owns, controls, or has the
power to vote, directly or indirectly, more than 5% of the outstanding equity
securities.

                  (d)      The minute books of the Bank contain complete and
accurate records in all material respects of all meetings and other corporate
actions held or taken by its respective shareholders and Board of Directors
(including all committees thereof).

         Section 3.2       Capitalization. (a) The authorized capital stock of
the Bank consists of 213,000 shares of common stock, par value $10.00
(hereinbefore and hereinafter referred to as the "Bank Shares"), 128,865 shares
of which as of the date hereof are issued and outstanding (with no shares held
in the treasury of the Bank). All of the issued and outstanding Bank Shares
have been duly authorized and validly issued and all such shares are fully paid
and nonassessable. As of the date hereof, there are no outstanding options,
warrants, commitments, or other rights or instruments to purchase or acquire
any shares of capital stock of the Bank, or any securities or rights
convertible into or exchangeable for shares of capital stock of the Bank,
except for options to purchase 5,500 Bank Shares (which are described in more
detail in Disclosure Schedule 3.2).

         Section 3.3       Financial Statements; Filings. (a) The Bank has
previously delivered to SouthTrust copies of the financial statements of the
Bank as of and for each of the three (3) fiscal years of the Bank ended
immediately prior to the date of this Agreement and the financial statements of
the Bank as of and for each of the fiscal periods of the Bank ended after the
close of the most recently completed fiscal year of the Bank and prior to the
date of this Agreement, and the Bank shall deliver to SouthTrust, as soon as
practicable following the preparation of additional financial statements for
each subsequent fiscal period or year of the Bank, the financial statements of
the Bank as of and


                                      A-6
<PAGE>   144

for such subsequent fiscal period or year (such financial statements, unless
otherwise indicated, being hereinafter referred to collectively as the
"Financial Statements of the Bank").

                  (b)      The Bank has previously delivered to SouthTrust 
copies of the Call Reports of the Bank as of and for each of the three (3)
fiscal years of the Bank ended immediately prior to the date of this Agreement
and the Call Reports of the Bank as of and for each of the fiscal periods of
the Bank ended after the close of the most recently completed fiscal year of
the Bank and prior to the date of this Agreement, and the Bank shall deliver to
SouthTrust, as soon as practicable following the preparation of additional Call
Reports for each subsequent fiscal period or year of the Bank, the Call Reports
of the Bank as of and for each such subsequent period or year (such Call
Reports, unless otherwise indicated, being hereinafter referred to collectively
as the "Call Reports of the Bank").

                  (c)      Each of the Financial Statements of the Bank, and
each of the Call Reports of the Bank (including the related notes, where
applicable) have been or will be prepared in all material respects in
accordance with generally accepted accounting principles or regulatory
accounting principles, whichever is applicable, which principles have been or
will be consistently applied during the periods involved, except as otherwise
noted therein, and the books and records of the Bank have been, are being, and
will be maintained in all material respects in accordance with applicable legal
and accounting requirements and reflect only actual transactions. Each of the
Financial Statements of the Bank and each of the Call Reports of the Bank
(including the related notes, where applicable) fairly present or will fairly
present the financial position of the Bank, on a consolidated basis (if
appropriate), as of the respective dates thereof and fairly present or will
fairly present the results of operations of the Bank, on a consolidated basis
(if appropriate), for the respective periods therein set forth.

                  (d)      To the extent not prohibited by law, the Bank has
heretofore delivered or made available, or caused to be delivered or made
available, to SouthTrust all reports and filings made or required to be made by
the Bank with the Regulatory Authorities, and will from time to time hereafter
furnish to SouthTrust, upon filing or furnishing the same to the Regulatory
Authorities, all such reports and filings made after the date hereof with the
Regulatory Authorities. Such reports and filings did not and shall not contain
any untrue statement of a material fact or omit to state a material fact
required to be stated therein or necessary to make the statements therein, in
light of the circumstances under which they were made, not misleading.

                  (e)      Since December 31, 1997, the Bank has not incurred 
any obligation or liability (contingent or otherwise) that has or might
reasonably be expected to have, individually or in the aggregate, a Material
Adverse Effect on the Bank, except obligations and liabilities (i) which are
accrued or reserved against in the Financial Statements of the Bank as of and
for the aforementioned date or reflected in the notes thereto, or (ii) which
were incurred after such date in the ordinary course of business, consistent
with past practices. Since December 31, 1997, the Bank has not incurred or paid
any obligation or liability which would have a Material Adverse Effect on the
Bank, except as may have been incurred or paid in the ordinary course of
business, consistent with past practices.

         Section 3.4       Loan Portfolio; Reserves. Except as set forth in
Disclosure Schedule 3.4, (i) all evidences of indebtedness in original
principal amount in excess of $10,000 reflected as assets in the Financial
Statements of the Bank and the Call Reports of the Bank as of and for the year
ended December 31, 1997 and the period ended March 31, 1998 were as of such
dates in all respects the binding obligations of the respective obligors named
therein in accordance with their respective terms and were not subject to any
defenses, setoffs, or counterclaims, except as may be provided by bankruptcy,
insolvency or similar laws or by general principles of equity, (ii) the
allowances for possible loan losses shown on the Financial Statements of the
Bank and the Call Reports of the Bank as of and for the year ended December 31,
1997 and the period ended March 31, 1998 were, and the allowance for possible
loan losses to be shown on the Financial Statements of the Bank, the Financial
Statements of the Bank and the Call Reports of the Bank as of any date
subsequent to the execution of this Agreement will be, as of such dates,
adequate to provide for possible losses, net of recoveries relating to loans
previously charged off, in respect of loans outstanding (including accrued
interest receivable) of the Bank and other extensions of credit (including
letters of credit or commitments to make loans or extend credit), (iii) the
reserve for losses with respect to other real estate owned ("OREO Reserve")
shown on the Financial Statements of the Bank and the Call Reports of the Bank
as of and for the year ended December 31, 1997 and the period ended March 31,
1998 were, and the OREO Reserve to be shown on the Financial Statements of the
Bank and the Call Reports of the Bank as of any date subsequent to the
execution of this Agreement will be, as of such dates, adequate to provide for
losses relating to the other real estate owned portfolio of the Bank as of the
dates thereof, (iv) the reserve for losses in respect of litigation
("Litigation Reserve") shown on the Financial Statements of the Bank and the
Call Reports of the Bank as of and for the year ended December 31, 1997 and the
period ended March 31, 1998 were, and the Litigation Reserve to be shown on the
Financial Statements of the Bank and the Call Reports of the Bank as of any
date subsequent to the execution of this Agreement will be, as of such dates,
adequate to provide for losses relating to or arising out of all pending or
threatened litigation applicable to the Bank as of the dates thereof, and (v)


                                      A-7
<PAGE>   145

each such allowance or reserve described above has been established in
accordance with the accounting principles described in Section 3.3(c) and
applicable regulatory requirements and guidelines.

         Section 3.5       Certain Loans and Related Matters. Except as set 
forth in Disclosure Schedule 3.5, the Bank is not a party to any written or
oral: (i) loan agreement, note or borrowing arrangement, other than credit card
loans and other loans the unpaid balance of which does not exceed $10,000 for
each such instrument, under the terms of which the obligor is sixty (60) days
delinquent in payment of principal or interest or in default of any other
provision as of the date hereof; (ii) loan agreement, note or borrowing
arrangement which has been classified or, in the exercise of reasonable
diligence by the Bank or any Regulatory Authority, should have been classified
as "substandard," "doubtful," "loss," "other loans especially mentioned,"
"other assets especially mentioned" or any comparable classifications by such
persons; (iii) loan agreement, note or borrowing arrangement, including any
loan guaranty, with any director or executive officer of the Bank or any ten
percent (10%) shareholder of the Bank, or any person, corporation or enterprise
controlling, controlled by or under common control with any of the foregoing;
or (iv) loan agreement, note or borrowing arrangement in violation of any law,
regulation or rule applicable to the Bank including, but not limited to, those
promulgated, interpreted or enforced by any of the Regulatory Authorities and
which violation could have a Material Adverse Effect on the Bank. As of the
date of any Financial Statement of the Bank and any Call Report of the Bank
subsequent to the execution of this Agreement, including the date of the
Financial Statements of the Bank, and the Call Reports of the Bank that
immediately precede the Effective Time of the Merger, there shall not have been
any material increase in the loan agreements, notes or borrowing arrangements
described in (i) through (iv) above and Disclosure Schedule 3.5.

         Section 3.6       Authority; No Violation. (a) The Bank has full 
corporate power and authority to execute and deliver this Agreement and,
subject to the approval of the shareholders of the Bank and to the receipt of
the Consents of the Regulatory Authorities, to consummate the transactions
contemplated hereby. The Board of Directors of the Bank has duly and validly
approved this Agreement and the transactions contemplated hereby, has
authorized the execution and delivery of this Agreement, has directed that this
Agreement and the transactions contemplated hereby be submitted to the Bank's
shareholders for approval at a meeting of such shareholders and, except for the
adoption of such Agreement by its shareholders, no other corporate proceedings
on the part of the Bank are necessary to consummate the transactions so
contemplated. This Agreement, when duly and validly executed by the Bank and
delivered by the Bank, will constitute a valid and binding obligation of the
Bank, and will be enforceable against the Bank in accordance with its terms,
except as such enforceability may be limited by applicable bankruptcy,
insolvency, reorganization, moratorium or similar laws affecting the
enforcement of creditors rights generally and except that the availability of
the equitable remedy of specific performance or injunctive relief is subject to
the discretion of the court before which any proceeding may be brought.

                  (b)      Neither the execution and delivery of this Agreement
by the Bank nor the consummation by the Bank of the transactions contemplated
hereby, nor compliance by the Bank with any of the terms or provisions hereof,
will (i) violate any provision of the Articles or Certificate of Incorporation
or Bylaws of the Bank, (ii) assuming that the Consents of the Regulatory
Authorities and approvals referred to herein are duly obtained, violate any
statute, code, ordinance, rule, regulation, judgment, order, writ, decree or
injunction applicable to the Bank or any of its respective properties or
assets, or (iii) assuming that any necessary Consents are obtained, violate,
conflict with, result in a breach of any provisions of, constitute a default
(or an event which, with notice or lapse of time, or both, would constitute a
default) under, result in the termination of, accelerate the performance
required by or result in the creation of any lien, security interest, charge or
other encumbrance upon any of the properties or assets of the Bank or under,
any of the terms, conditions or provisions of any material note, bond,
mortgage, indenture, deed of trust, license, permit, lease, agreement or other
instrument or obligation to which the Bank is a party, or by which the Bank or
any of its respective properties or assets may be bound or affected.

         Section 3.7       Consents and Approvals. Except for (i) the filing by 
the Bank with the SEC of a proxy statement of the Bank relating to the meeting
of the shareholders of the Bank at which the Merger is to be considered (the
"Proxy Statement"); (ii) the Consents of the OCC and the Department; (iii)
approval of this Agreement by the shareholders of ST-Bank and the Bank; (iv)
filing of this Agreement and certified resolutions with the OCC and the
Department; (v) issuance of a certificate of merger by the Department; and (vi)
as set forth in Disclosure Schedule 3.7, no Consents of any person are
necessary in connection with the execution and delivery by the Bank of this
Agreement and the consummation by the Bank of the Merger and the other
transactions contemplated hereby.

         Section 3.8       Broker's Fees. The Bank nor any of its respective 
officers or directors, has employed any broker or finder or incurred any
liability for any broker's fees, commissions or finder's fees in connection
with any of the transactions contemplated by this Agreement, except that the
Bank has engaged Allen C. Ewing & Co., whose fee is payable by the Bank.


                                      A-8
<PAGE>   146

         Section 3.9       Absence of Certain Changes or Events. Except as set 
forth in Disclosure Schedule 3.9, since December 31, 1997, there has not been
(i) any declaration, payment or setting aside of any dividend or distribution
(whether in cash, stock or property) in respect of Bank Shares or (ii) any
change or any event involving the Bank which has had, or is reasonably likely
to have, a Material Adverse Effect on the Bank, including, without limitation
any change in the administration or supervisory standing or rating of the Bank,
with any Regulatory Authority, and no fact or condition exists as of the date
hereof which might reasonably be expected to cause any such event or change in
the future.

         Section 3.10      Legal Proceedings; Etc. Except as set forth in 
Disclosure Schedule 3.10, the Bank is not a party to any, and there are no
pending or, to the knowledge of the Bank, threatened, judicial, administrative,
arbitral or other proceedings, claims, actions, causes of action or
governmental investigations against the Bank challenging the validity of the
transactions contemplated by this Agreement and, to the knowledge of the Bank
as of the date hereof, there is no material proceeding, claim, action or
governmental investigation against the Bank; no judgment, decree, injunction,
rule or order of any court, governmental department, commission, agency,
instrumentality or arbitrator is outstanding against the Bank which has or
might reasonably be expected to have a Material Adverse Effect on the Bank;
there is no default by the Bank under any material contract or agreement to
which the Bank is a party; and the Bank is not a party to any agreement, order
or memorandum in writing by or with any Regulatory Authority restricting the
operations of the Bank and the Bank has not been advised by any Regulatory
Authority that any such Regulatory Authority is contemplating issuing or
requesting the issuance of any such order or memorandum in the future.

         Section 3.11      Taxes and Tax Returns. (a) The Bank has previously
delivered or made available to SouthTrust copies of the federal, state and
local income tax returns of the Bank for the years 1993, 1994, 1995 and 1996
and all schedules and exhibits thereto, and will provide SouthTrust with a copy
of all federal, state and local income tax returns for the year 1997 and all
schedules and exhibits thereto, when such returns are filed, and, to the
knowledge of the Bank such returns have not been examined by the Internal
Revenue Service or any other taxing authorities. Except as reflected in
Disclosure Schedule 3.11, the Bank has duly filed in correct form all federal,
state and local information returns and tax returns in respect of Taxes
required to be filed by the Bank on or prior to the date hereof, and the Bank
has duly paid or made adequate provisions for the payment of all Taxes which
have been incurred or are due or claimed to be due from the Bank other than
Taxes which (i)(A) are not yet delinquent or (B) are being contested in good
faith or (ii) have not been finally determined. The amounts set forth as
liabilities for Taxes on the Financial Statements of the Bank and the Call
Reports of the Bank are sufficient, in the aggregate, for the payment of all
unpaid Taxes, whether or not disputed, accrued or applicable, for the periods
then ended, and have been computed in accordance with generally accepted
accounting principles. The Bank is not responsible for the Taxes of any other
person other than the Bank and its subsidiaries, under treasury Regulation
1.1502-6 or any similar provision of federal, state or foreign law.

                  (b)      Except as disclosed in Disclosure Schedule 3.11, the
Bank has not executed an extension or waiver of any statute of limitations on
the assessment or collection of any Tax due that is currently in effect, and
deferred taxes of the Bank have been adequately provided for in the financial
statements of the Bank, as the case may be.

                  (c)      Except as disclosed in Disclosure Schedule 3.11, the
Bank has not made any payment, is not obligated to make any payment and is not
a party to any contract, agreement or other arrangement that could obligate it
to make any payment that would be disallowed as a deduction under Section
280(G) or 162(m) of the Code.

                  (d)      There has not been an ownership change, as defined in
Section 382(G) of the Code, of the Bank that occurred during or after any
taxable period in which the Bank incurred an operating loss that carries over
to any taxable period ending after the fiscal year of the Bank immediately
preceding the date of this Agreement.

                  (e)      (i) Proper and accurate amounts have been withheld
by the Bank from its employees and others for all prior periods in compliance
in all material respects with the tax withholding provisions of all applicable
federal, state and local laws and regulations, and proper due diligence steps
have been taken in connection with back-up withholding, (ii) federal, state and
local returns have been filed by the Bank for all periods for which returns
were due with respect to withholding, Social Security and unemployment Taxes
and (iii) the amounts shown on such returns to be due and payable have been
paid in full or adequate provision therefor has been included by the Bank in
the Financial Statements of the Bank.

         Section 3.12      Employee Benefit Plans. (a) The Bank does not have or
maintain any "employee benefit plan," as defined in Section 3(3) of the
Employee Retirement Income Security Act of 1974, as amended ("ERISA"), or other
benefit plan or arrangement except as described in Disclosure Schedule 3.12(a).


                                      A-9
<PAGE>   147

                  (b)      The Bank (or any pension plan maintained by it) has
not incurred any liability to the Pension Benefit Guaranty Corporation ("PBGC")
or the Internal Revenue Service with respect to any pension plan qualified
under Section 401 of the Code, except liabilities to the PBGC pursuant to
Section 4007 of ERISA, all which have been fully paid. No reportable event
under Section 4043(b) of ERISA (including events waived by PBGC regulation) has
occurred with respect to any such pension plan.

                  (c)      The Bank has not incurred any material liability
under Section 4201 of ERISA for a complete or partial withdrawal from, and has
not agreed to participate in, any multi-employer plan as such term is defined
in Section 3(37) of ERISA. The Bank has not incurred and does not contemplate
incurring, any liability under Section 4063 or 4064 of ERISA.

                  (d)      All "employee benefit plans," as defined in Section 
3(3) of ERISA, that are maintained by the Bank comply, in all material respects
with ERISA, and the provisions of the Code that are applicable, or intended to
be applicable, to such "employee benefit plans." All documents, summaries,
forms or other information required to be provided to participants in such
employee benefit plans or to be filed with or provided to any governmental
agency have been so provided or filed on a timely basis. The Bank does not have
any material liability under any such plan that is not reflected in the
Financial Statements of the Bank or the Call Reports of the Bank.

                  (e)      No prohibited transaction (which shall mean any
transaction prohibited by Section 406 of ERISA and not exempt under Section 408
of ERISA) has occurred with respect to any employee benefit plan maintained by
the Bank (i) which would result in the imposition, directly or indirectly, of a
material excise tax under Section 4975 of the Code or a material civil penalty
under Section 502(i) of ERISA, or (ii) the correction of which would have a
material adverse effect on the Condition of the Bank; and, to the best
knowledge of the Bank no actions have occurred which could result in the
imposition of a penalty under any section or provision of ERISA.

                  (f)      No employee benefit plan which is a defined benefit
pension plan has any "unfunded current liability," as that term is defined in
Section 302(d)(8)(A) of ERISA, and the present fair market value of the assets
of any such plan exceeds the plan's "benefit liabilities," as that term is
defined in Section 4001(a)(16) of ERISA, when determined under actuarial
factors that would apply if the plan terminated in accordance with all
applicable legal requirements.

                  (g)      Except as set forth in Disclosure Schedule 3.12(g),
neither the execution and delivery of this Agreement nor the consummation of
the transactions contemplated hereby will (i) result in any material payment
(including, without limitation, severance, unemployment compensation, golden
parachute or otherwise) becoming due to any director or any officer or employee
of the Bank under any benefit plan or otherwise, (ii) materially increase any
benefits otherwise payable under any benefit plan or (iii) result in any
acceleration of the time of payment or vesting of any such benefits to any
material extent.

                  (h)      The Bank does not maintain any employee benefit plan
providing for medical or life insurance benefits to retired or terminated
employees or dependents thereof, except as may be required by Part 6 of Title I
of ERISA or Section 4980B of the Code.

         Section 3.13      Title and Related Matters. (a) Except as set forth in
Disclosure Schedule 3.13(a), the Bank has good title, and as to owned real
property, has good and marketable title in fee simple absolute, to all assets
and properties, real or personal, tangible or intangible, reflected as owned by
it on the Financial Statements of the Bank or the Call Reports of the Bank or
acquired subsequent thereto (except to the extent that such assets and
properties have been disposed of for fair value in the ordinary course of
business since December 31, 1997), free and clear of all liens, encumbrances,
mortgages, security interests, restrictions, pledges or claims, except for (i)
those liens, encumbrances, mortgages, security interests, restrictions, pledges
or claims reflected in the Financial Statements of the Bank and the Call
Reports of the Bank or incurred in the ordinary course of business after
December 31, 1997, (ii) statutory liens for amounts not yet delinquent or which
are being contested in good faith, and (iii) liens, encumbrances, mortgages,
security interests, pledges, claims and title imperfections that would not in
the aggregate have a Material Adverse Effect on the Bank.

                  (b)      All agreements pursuant to which the Bank leases,
subleases or licenses material real or material personal properties from others
are valid, binding and enforceable in accordance with their respective terms,
and there is not, under any of such leases or licenses, any existing default or
event of default, or any event which with notice or lapse of time, or both,
would constitute a default or force majeure, or provide the basis for any other
claim of excusable delay or nonperformance, except for defaults which
individually or in the aggregate would not have a Material Adverse Effect on
the Bank. Except as set forth in Disclosure Schedule 3.13(b), the Bank has all
right, title and interest as a lessee under the terms of each lease or
sublease, free and clear of all liens, claims or encumbrances (other than the


                                      A-10
<PAGE>   148

rights of the lessor), and, as of the Effective Time of the Merger, shall have
the right to transfer each lease or sublease pursuant to this Agreement.

                  (c)      Other than real estate owned, acquired by foreclosure
or voluntary deed in lieu of foreclosure (i) all of the buildings, structures
and fixtures owned, leased or subleased by the Bank are in good operating
condition and repair, subject only to ordinary wear and tear and/or minor
defects which do not interfere with the continued use thereof in the conduct of
normal operations, and (ii) all of the material personal properties owned,
leased or subleased by the Bank are in good operating condition and repair,
subject only to ordinary wear and tear and/or minor defects which do not
interfere with the continued use thereof in the conduct of normal operations.

         Section 3.14      Real Estate. (a) Disclosure Schedule 3.14(a)
identifies and sets forth a complete legal description for each parcel of real
estate or interest therein owned, leased or subleased by the Bank or in which
the Bank has any ownership or leasehold interest.

                  (b)      Disclosure Schedule 3.14(b) identifies and sets forth
each and every written or oral lease or sublease under which the Bank is the
lessee of any real property and which relates in any manner to the operation of
the businesses of the Bank.

                  (c)      The Bank has not violated, and is not currently in
violation of, any law, regulation or ordinance relating to the ownership or use
of the real estate and real estate interests described in Disclosure Schedules
3.14(a) and 3.14(b) including, but not limited to any law, regulation or
ordinance relating to zoning, building, occupancy, environmental or comparable
matter which individually or in the aggregate would have a Material Adverse
Effect on the Bank.

                  (d)      As to each parcel of real property owned or used by 
the Bank, the Bank has not received notice of any pending or, to the knowledge
of the Bank, threatened condemnation proceedings, litigation proceedings or
mechanics or materialmen's liens.

         Section 3.15      Environmental Matters.

                  (a)      Each of the Bank, the Participation Facilities (as
defined below), and the Loan Properties (as defined below) are, and have been,
in compliance with all applicable laws, rules, regulations, standards and
requirements of the United States Environmental Protection Agency and all state
and local agencies with jurisdiction over pollution or protection of the
environment, except for violations which, individually or in the aggregate,
will not have a Material Adverse Effect on the Bank.

                  (b)      There is no litigation pending or, to the knowledge 
of the Bank, threatened before any court, governmental agency or board or other
forum in which the Bank or any Participation Facility has been or, with respect
to threatened litigation, may be, named as defendant (i) for alleged
noncompliance (including by any predecessor), with any Environmental Law or
(ii) relating to the release into the environment of any Hazardous Material or
oil, whether or not occurring or on a site owned, leased or operated by the
Bank or any Participation Facility, except for such litigation pending or
threatened that will not, individually or in the aggregate, have a Material
Adverse Effect on the Bank.

                  (c)      There is no litigation pending or, to the knowledge
of the Bank, threatened before any court, governmental agency or board or other
forum in which any Loan Property (or the Bank in respect of such Loan Property)
has been or, with respect to threatened litigation, may be, named as a
defendant or potentially responsible party (i) for alleged noncompliance
(including by any predecessor) with any Environmental Law or (ii) relating to
the release into the environment of any Hazardous Material or oil, whether or
not occurring at, on or involving a Loan Property, except for such litigation
pending or threatened that will not individually or in the aggregate, have a
Material Adverse Effect on the Bank.

                  (d)      To the knowledge of the Bank, there is no reasonable
basis for any litigation of a type described in Sections 3.15(b) or 3.15(c) of
this Agreement, except as will not have, individually or in the aggregate, a
Material Adverse Effect on the Bank.

                  (e)      During the period of (i) ownership or operation by
the Bank of any of their respective current properties, (ii) participation by
the Bank in the management of any Participation Facility, or (iii) holding by
the Bank of a security interest in any Loan Property, there have been no
releases of Hazardous Material or oil in, on, under or affecting such
properties, except where such releases have not and will not, individually or
in the aggregate, have a material adverse effect on the Condition of the Bank
on a consolidated basis.


                                      A-11
<PAGE>   149

                  (f)      Prior to the period of (i) ownership or operation by 
the Bank of any of their respective current properties, (ii) participation by
the Bank in the management of any Participation Facility, or (iii) holding by
the Bank of a security interest in any Loan Property, to the knowledge of the
Bank, there were no releases of Hazardous Material or oil in, on, under or
affecting any such property, Participation Facility or Loan Property, except
where such releases have not and will not, individually or in the aggregate,
have a material adverse effect on the Condition of the Bank on a consolidated
basis.

         Section 3.16      Commitments and Contracts. Except as set forth in
Disclosure Schedule 3.16, the Bank is not a party or subject to any of the
following (whether written or oral, express or implied):

                  (a)      Any employment contract or understanding (including 
any understandings or obligations with respect to severance or termination pay
liabilities or fringe benefits) with any present or former officer, director,
employee, including in any such person's capacity as a consultant (other than
those which either are terminable at will without any further amount being
payable thereunder or as a result of such termination by the Bank);

                  (b)      Any labor contract or agreement with any labor union;

                  (c)      Any contract covenants which limit the ability of the
Bank to compete in any line of business or which involve any restriction of the
geographical area in which the Bank may carry on its business (other than as
may be required by law or applicable regulatory authorities);

                  (d)      Any lease (other than real estate leases described on
Disclosure Schedule 3.14(b)) or other agreements or contracts with annual
payments aggregating $5,000 or more; or

                  (e)      Any other contract or agreement which would be 
required to be disclosed in reports filed by the Bank with the SEC or the FRB
and which has not been so disclosed.

         Except as set forth in Disclosure Schedule 3.16, there is not, under
any agreement, lease or contract to which the Bank is a party, any existing
default or event of default, or any event which with notice or lapse of time,
or both, would constitute a default or force majeure, or provide the basis for
any other claim of excusable delay or non-performance.

         Section 3.17      Regulatory Matters. The Bank has not agreed to take
any action and does not have any knowledge of any fact and has not agreed to
any circumstance that would (i) materially impede or delay receipt of any
Consents of any Regulatory Authorities referred to in this Agreement including,
matters relating to the Community Reinvestment Act and protests thereunder,
(ii) prevent the transactions contemplated by this Agreement from qualifying as
a reorganization within the meaning of Section 368(a) of the Code, or (iii)
materially impede the ability of SouthTrust to account for the transactions
contemplated by this Agreement as a pooling of interests.

         Section 3.18      Registration Obligations. The Bank is not under any
obligation, contingent or otherwise, which will survive the Merger to register
any of its securities under the Securities Act of 1933 or any state securities
laws.

         Section 3.19      State Takeover Laws.  This Agreement and the 
transactions contemplated hereby are not subject to or restricted by any
applicable state anti-takeover statute.

         Section 3.20      Insurance. The Bank is presently insured, and during
each of the past three calendar years has been insured, for reasonable amounts
against such risks as companies or institutions engaged in a similar business
would, in accordance with good business practice, customarily be insured. To
the knowledge of the Bank, the policies of fire, theft, liability and other
insurance maintained with respect to the assets or businesses of the Bank
provide adequate coverage against loss, and the fidelity bonds in effect as to
which the Bank is named an insured are sufficient for their purpose. Such
policies of insurance are listed and described in Disclosure Schedule 3.20.

         Section 3.21      Labor. No work stoppage involving the Bank is
pending as of the date hereof or, to the knowledge of the Bank, threatened. The
Bank is not involved in, or, to the knowledge of the Bank, threatened with or
affected by, any proceeding asserting that the Bank has committed an unfair
labor practice or any labor dispute, arbitration, lawsuit or administrative
proceeding which might reasonably be expected to have a material adverse effect
on the Condition of the Bank on a consolidated basis. No union represents or
claims to represent any employees of the Bank, and, to the knowledge of the
Bank, no labor union is attempting to organize employees of the Bank.

         Section 3.22      Compliance with Laws.  The Bank has conducted its 
business in accordance with all applicable federal, foreign, state and local
laws, regulations and orders, and is in compliance with such laws, regulations


                                      A-12
<PAGE>   150

and orders, except for such violations or non-compliance, which when taken
together as a whole, will not have a Material Adverse Effect on the Bank.
Except as disclosed in Disclosure Schedule 3.22, the Bank:

                  (a)      Is not in violation of any laws, orders or permits
                           applicable to its business or the employees or
                           agents or representatives conducting such business,
                           except for violations which individually or in the
                           aggregate do not have and will not have a Material
                           Adverse Effect on the Bank; and

                  (b)      Has not received a notification or communication
                           from any agency or department of federal, state or
                           local government or the Regulatory Authorities or
                           the staff thereof (i) asserting that the Bank is not
                           in compliance with any laws or orders which such
                           governmental authority or Regulatory Authority
                           enforces, unless such noncompliance is not
                           reasonably likely to have a Material Adverse Effect
                           on the Bank, (ii) threatening to revoke any permit,
                           unless such revocation is not reasonably likely to
                           have a Material Adverse Effect on the Bank, (iii)
                           requiring the Bank to enter into any cease and
                           desist order, formal agreement, commitment or
                           memorandum of understanding, or to adopt any
                           resolutions or similar undertakings, or (iv)
                           directing, restricting or limiting, or purporting to
                           direct, restrict or limit in any manner, the
                           operations of the Bank, including, without
                           limitation, any restrictions on the payment of
                           dividends.

         Section 3.23      Transactions with Management. Except for (a) 
deposits, all of which are on terms and conditions comparable to those made
available to other customers of the Bank at the time such deposits were entered
into, (b) the agreements listed on Disclosure Schedule 3.16, and (c) the items
described on Disclosure Schedule 3.23, there are no contracts with or
commitments to present or former stockholders, directors, officers or employees
involving the expenditure of more than $1,000 as to any one individual,
including, with respect to any business directly or indirectly controlled by
any such person, or $5,000 for all such contracts for commitments in the
aggregate for all such individuals.

         Section 3.24      Derivative Contracts. The Bank is not a party to and 
has not agreed to enter into an exchange-traded or over-the-counter swap,
forward, future, option, cap, floor or collar financial contract or agreement,
or any other contract or agreement not included in the Financial Statements of
the Bank which is a financial derivative contract (including various
combinations thereof) ("Derivative Contracts"), except for those Derivatives
Contracts set forth in Disclosure Schedule 3.24.

         Section 3.25      Deposits. To the best of the Bank's knowledge, none
of the deposits of the Bank is a "brokered" deposit or is subject to any
encumbrance, legal restraint or other legal process, and no portion of such
deposits represents a deposit of any affiliate of the Bank, except as set forth
in Disclosure Schedule 3.25.

         Section 3.26      Accounting Controls. The Bank has devised and 
maintained systems of internal accounting control sufficient to provide
reasonable assurances that: (i) all material transactions are executed in
accordance with general or specific authorization of the Board of Directors and
the duly authorized executive officers of the Bank; (ii) all material
transactions are recorded as necessary to permit the preparation of financial
statements in conformity with generally accepted accounting principles
consistently applied with respect to institutions such as the Bank or any other
criteria applicable to such financial statements, and to maintain proper
accountability for items therein; (iii) access to the material profit and
assets of the Bank is permitted only in accordance with general or specific
authorization of the Board of Directors and the duly authorized executive
officers of the Bank; and (iv) the recorded accountability for items is
compared with the actual levels at reasonable intervals and appropriate actions
taken with respect to any differences.

         Section 3.27      Proxy Materials. None of the information relating to 
the Bank to be included in the Proxy Statement which is to be mailed to the
shareholders of the Bank in connection with the solicitation of their approval
of this Agreement will, at the time such Proxy Statement is mailed or at the
time of the meeting of shareholders to which such Proxy Statement relates, be
false or misleading with respect to any material fact, or omit to state any
material fact, necessary in order to make a statement therein not false or
misleading. The legal responsibility for the contents of such Proxy Statement
(other than information supplied by SouthTrust concerning SouthTrust or any of
its subsidiaries) shall be and remain with the Bank.

         Section 3.28      Deposit Insurance. The deposit accounts of the Bank 
are insured by the Bank Insurance Fund in accordance with the provisions of the
Federal Deposit Insurance Act (the "Act"); the Bank has paid all regular
premiums and special assessments and filed all reports required under the Act.


                                      A-13
<PAGE>   151

         Section 3.29      Untrue Statements and Omissions. No representation or
warranty contained in Article III of this Agreement or in the Disclosure
Schedules of the Bank contains any untrue statement of a material fact or omits
to state a material fact necessary to make the statements therein, in light of
the circumstances under which they were made, not misleading.

         Section 3.30      Year 2000. Except as specifically set forth in 
Disclosure Schedule 3.30, to the Bank's knowledge, all computer software
necessary for the conduct of the business of the Bank (the "Software") is
designed to be used prior to, during and after the calendar year 2000 A.D., and
the Software will operate during each such time period without error relating
to the year 2000, specifically including any error relating to, or the product
of, date data which represents or references different centuries or more than
one century. The Software accepts, calculates, sorts, extracts, and otherwise
processes date inputs and date values, and returns and displays date values, in
a consistent manner regardless of the dates used, whether before, on, or after
January 1, 2000.


                                   ARTICLE IV

                       REPRESENTATIONS AND WARRANTIES OF
                             SOUTHTRUST AND ST-BANK


         SouthTrust and ST-Bank hereby represent and warrant to the Bank as
follows as of the date hereof and also on the Effective Time of the Merger
(except as otherwise provided):

         Section 4.1       Organization and Related Matters of SouthTrust. (a)
SouthTrust is a corporation duly organized, validly existing and in good
standing under the laws of the State of Delaware. SouthTrust has the corporate
power and authority to own or lease all of its properties and assets and to
carry on its business as now conducted, or as proposed to be conducted pursuant
to this Agreement, and SouthTrust is licensed or qualified to do business in
each jurisdiction in which the nature of the business conducted by SouthTrust,
or the character or location of the properties and assets owned or leased by
SouthTrust makes such licensing or qualification necessary, except where the
failure to be so licensed or qualified (or steps necessary to cure such
failure) would not have a Material Adverse Effect on SouthTrust. SouthTrust is
duly registered as a bank holding company under the Bank Holding Bank Act of
1956, as amended. True and correct copies of the Restated Certificate of
Incorporation of SouthTrust and the Bylaws of SouthTrust, each as amended to
the date hereof, have been made available to the Bank.

                  (b)      SouthTrust has in effect all federal, state, local 
and foreign governmental, regulatory and other authorizations, permits and
licenses necessary for it to own or lease its properties and assets and to
carry on its business as now conducted, the absence of which, either
individually or in the aggregate, would have a Material Adverse Effect on
SouthTrust.

                  (c)      The minute books of SouthTrust contain complete and
accurate records in all material respects of all meetings and other corporate
actions held or taken by the shareholders and Boards of Directors of
SouthTrust.

         Section 4.2       Organization and Related Matters of ST-Bank. (a)
ST-Bank is a national banking association duly organized, validly existing and
in good standing under the laws of the United States. ST-Bank has, or as of the
Effective Time of the Merger, will have, the corporate power and authority to
own or lease all of its properties and assets and to carry on its business as
now conducted, or as proposed to be conducted pursuant to this Agreement, and
ST-Bank is, or as of the Effective Time of the Merger, will be, licensed or
qualified to do business in each jurisdiction where the nature of the business
conducted or to be conducted by ST-Bank, or the character or location or the
properties and assets owned or leased or to be owned or leased by ST-Bank make
such licensing or qualification necessary, except where the failure to be so
licensed or qualified (including any action necessary to cure such failure)
would not have a Material Adverse Effect on SouthTrust. True and correct copies
of the Certificate or Articles of Incorporation and Bylaws of ST-Bank, as each
may be amended to the date hereof, will be made available to the Bank.

                  (b)      ST-Bank has, or as of the Effective Time of the
Merger will have, in effect all federal, state, local and foreign governmental,
regulatory or other authorizations, permits and licenses necessary for it to
own or lease its properties and assets and to carry on its business as proposed
to be conducted, the absence of which, either individually or in the aggregate,
would have a Material Adverse Effect on SouthTrust.

                  (c)      The minute books of ST-Bank contain, or as of the
Effective Time of the Merger, will contain complete and accurate records in all
material respects of all meetings and other corporate actions held or taken by
the shareholders and Board of Directors of ST-Bank.


                                      A-14
<PAGE>   152

         Section 4.3       Capitalization. As of March 31, 1998, the authorized
capital stock of SouthTrust consisted of 500,000,000 shares of common stock,
par value $2.50 per share, 160,437,557 shares (which includes the rights
associated with such shares pursuant to that certain Rights Agreement dated as
of February 22, 1989 between SouthTrust and Mellon Bank, N.A.) of which are
issued and outstanding (exclusive of any such shares held in the treasury of
SouthTrust as of the date hereof), and 5,000,000 shares of preferred stock, par
value $1.00 per share, none of which is issued and outstanding as of the date
hereof. All issued and outstanding SouthTrust Shares have been duly authorized
and validly issued, and all such shares are fully paid and nonassessable.

         Section 4.4       Authorization. The execution, delivery, and 
performance of this Agreement, and the consummation of the transactions
contemplated hereby and in any related agreements, have been, or as of the
Effective Time of the Merger will have been, duly authorized by the Boards of
Directors of SouthTrust and ST-Bank, and no other corporate proceedings on the
part of SouthTrust or ST-Bank are or will be necessary to authorize this
Agreement and the transactions contemplated hereby. This Agreement, when duly
authorized, will be the valid and binding obligation of SouthTrust and ST-Bank
enforceable against each in accordance with its terms, except as such
enforceability may be limited by applicable bankruptcy, insolvency,
reorganization, moratorium or similar laws affecting the enforcement of
creditors rights generally and except that the availability of the equitable
remedy of specific performance or injunctive relief is subject to the
discretion of the court before which any proceeding may be brought and to
principles of public policy. Neither the execution, delivery or performance of
this Agreement nor the consummation of the transactions contemplated hereby
will (i) violate any provision of the Restated Certificate of Incorporation or
Bylaws of SouthTrust or the Articles or Certificate of Incorporation or Bylaws
of ST-Bank or, (ii) to SouthTrust's knowledge and assuming that any necessary
Consents are duly obtained, (A) violate, conflict with, result in a breach of
any provisions of, constitute a default (or an event which, with notice or
lapse of time, or both, would constitute a default) under, result in the
termination of, accelerate the performance required by or result in the
creation of any lien, security interest, charge or other encumbrance upon any
of the properties or assets of SouthTrust or ST-Bank under, any of the terms,
conditions or provisions of any note, bond, mortgage, indenture, deed of trust,
license, permit, lease, agreement or other instrument or obligation to which
SouthTrust or ST-Bank is a party, or by which SouthTrust or ST-Bank or any of
their respective properties or assets may be bound or affected, (B) violate any
statute, code, ordinance, rule, regulation, judgment, order, writ, decree or
injunction applicable to SouthTrust or ST-Bank or any of their respective
material properties or assets, except for (X) such conflicts, breaches or
defaults as are set forth in Disclosure Schedule 4.4; and (Y) with respect to
(B) and (C) above, such as individually or in the aggregate will not have a
Material Adverse Effect on SouthTrust.

         Section 4.5       Financial Statements. (a) SouthTrust has made
available to the Bank copies of the consolidated financial statements of
SouthTrust as of and for the two fiscal years ended immediately prior to the
date of this Agreement, and as of and for the period ended March 31, 1998, and
SouthTrust will make available to the Bank, as soon as practicable following
the preparation of additional consolidated financial statements for each
subsequent fiscal period or year of SouthTrust ended after the date of this
Agreement and prior to the Effective Time of the Merger, the consolidated
financial statements of SouthTrust as of and for such subsequent fiscal period
or year (such consolidated financial statements, unless otherwise indicated,
being hereinafter referred to collectively as the "Financial Statements of
SouthTrust").

                  (b)      Each of the Financial Statements of SouthTrust 
(including the related notes) have been or will be prepared in all material
respects in accordance with generally accepted accounting principles, which
principles have been or will be consistently applied during the periods
involved, except as otherwise noted therein, and the books and records of
SouthTrust have been, are being, and will be maintained in all material
respects in accordance with applicable legal and accounting requirements and
reflect only the actual transactions. Each of the Financial Statements of
SouthTrust (including the related notes) fairly presents or will fairly present
the consolidated financial position of SouthTrust as of the respective dates
thereof and fairly presents or will fairly present the results of operations of
SouthTrust for the respective periods therein set forth.

                  (c)      Since December 31, 1997, SouthTrust has not incurred
any obligation or liability (contingent or otherwise) that has or might
reasonably be expected to have, individually or in the aggregate, a Material
Adverse Effect on SouthTrust, except obligations and liabilities (i) which are
accrued or reserved against in the Financial Statements of SouthTrust or
reflected in the notes thereto, and (ii) which were incurred after December 31,
1997 in the ordinary course of business consistent with past practices. Since
December 31, 1997, and except for the matters described in (i) and (ii) above,
SouthTrust has not incurred or paid any obligation or liability which would
have a Material Adverse Effect on SouthTrust.

         Section 4.6       Absence of Certain Changes or Events.  Since
December 31, 1997, no fact or condition has occurred which would give rise to a
Material Adverse Effect on SouthTrust, and to the knowledge of SouthTrust, no


                                      A-15
<PAGE>   153
fact or condition exists which might reasonably be expected to cause such a
Material Adverse Effect on SouthTrust in the future.

         Section 4.7       Legal Proceedings, Etc. Except as set forth on
Disclosure Schedule 4.7 hereto, or as disclosed in any registration statement
filed by SouthTrust with the SEC and made available to the Bank hereunder,
SouthTrust is not a party to any, and there are no pending, or, to the
knowledge of SouthTrust, threatened, legal, administrative, arbitrary or other
proceedings, claims, actions, causes of action or governmental investigations
of any nature against SouthTrust challenging the validity or propriety of the
transactions contemplated by this Agreement or which would be required to be
reported by SouthTrust pursuant to Item 103 of Regulation S-K promulgated by
the SEC.

         Section 4.8       Insurance. SouthTrust has in effect insurance 
coverage with insurers which, in respect of amounts, premiums, types and risks
insured, constitutes reasonably adequate coverage against all risks customarily
insured against by institutions comparable in size and operation to SouthTrust.

         Section 4.9       Consents and Approvals. Except for (i) the Consents 
of the Regulatory Authorities; (ii) approval of this Agreement by the
respective shareholders of ST-Bank and the Bank; (iii) filing of this Agreement
and certified resolutions with the Department; (iv) issuance of a Certificate
of Merger by the OCC; and (v) as previously disclosed, no consents or approvals
by, or filings or registrations with, any third party or any public body,
agency or authority are necessary in connection with the execution and delivery
by SouthTrust and ST-Bank or, to the knowledge of SouthTrust, by the Bank of
this Agreement, and the consummation of the Merger and the other transactions
contemplated hereby.

         Section 4.10      Accounting, Tax, Regulatory Matters. SouthTrust has 
not agreed to take any action, has no knowledge of any fact and has not agreed
to any circumstance that would (i) prevent the transactions contemplated
hereby, including the Merger, from qualifying as a reorganization within the
meaning of Section 368 of the Code, (ii) materially impede or delay receipt of
any Consent from any Regulatory Authority referred to in this Agreement, or
(iii) materially impede the ability of SouthTrust to account for the
transactions contemplated by this Agreement as a pooling of interests.

         Section 4.11      Proxy Materials. None of the information relating
solely to SouthTrust or any of its subsidiaries to be included or incorporated
by reference in the Proxy Statement which is to be mailed to the shareholders
of the Bank in connection with the solicitation of their approval of this
Agreement will, at the time such Proxy Statement is mailed or at the time of
the meeting of shareholders of the Bank to which such Proxy Statement relates,
be false or misleading with respect to any material fact, or omit to state any
material fact necessary in order to make a statement therein not false or
misleading. The legal responsibility for the contents of the information
supplied by SouthTrust and relating solely to SouthTrust which is either
included or incorporated by reference in the Proxy Statement shall be and
remain with SouthTrust.

         Section 4.12      No Broker's or Finder's Fees. Neither SouthTrust nor
ST-Bank or any of their subsidiaries, affiliates or employers has employed any
broker or finder or incurred any liability for any broker's fees, commissions
or finder's fees in connection with this Agreement or the consummation of any
of the transactions contemplated herein.

         Section 4.13      Untrue Statements and Omissions. No representation or
warranty contained in Article IV of this Agreement or in the Disclosure
Schedules of SouthTrust or ST-Bank contains any untrue statement of a material
fact or omits to state a material fact necessary to make the statements
therein, in light of the circumstances under which they were made, not
misleading.

         Section 4.14      SEC Filings. SouthTrust has heretofore delivered to
the Bank copies of SouthTrust's: (i) Annual Report on Form 10-K for the fiscal
year ended December 31, 1997; (ii) 1997 Annual Report to Shareholders, and
(iii) all reports on Form 8-K and Form 10-Q filed by SouthTrust with the SEC
since December 31, 1997. Since December 31, 1997, SouthTrust has timely filed
all reports and the documents required to be filed with the SEC under the rules
and regulations of the SEC and all such reports or other documents have
complied in all material respects, as of their respective filing dates and
effective dates, as the case may be, with all the applicable requirements of
the Securities Act of 1933 and the Securities Exchange Act of 1934. As of the
respective filing and effective dates, none of such reports or other documents
contained any untrue statement of a material fact or omitted to state a
material fact to be stated therein or necessary in order to make the statements
therein, in light of the circumstances under which they were made, not
misleading.


                                      A-16
<PAGE>   154

                                   ARTICLE V

                            COVENANTS AND AGREEMENTS


         Section 5.1       Conduct of the Business of the Bank. (a) During the 
period from the date of this Agreement to the Effective Time of the Merger, the
Bank shall (i) conduct its business in the usual, regular and ordinary course
consistent with past practice and prudent banking and business principles, (ii)
use its best efforts to maintain and preserve intact its business organization,
employees, goodwill with customers and advantageous business relationships and
retain the services of its officers and key employees, and (iii) except as
required by law or regulation, take no action which would adversely affect or
delay the ability of the Bank or SouthTrust to obtain any Consent from any
Regulatory Authorities or other approvals required for the consummation of the
transactions contemplated hereby or to perform its covenants and agreements
under this Agreement.

                  (b)      During the period from the date of this Agreement to
the Effective Time of the Merger, except as required by law or regulation, the
Bank shall not, without the prior written consent of SouthTrust:

         (i)      change, delete or add any provision of or to the Articles of 
                  Incorporation or Bylaws of the Bank;

         (ii)     except for the issuance of the Bank Shares pursuant to the
                  terms of the Bank Options, change the number of shares of the
                  authorized, issued or outstanding capital stock of the Bank,
                  including any issuance, purchase, redemption, split,
                  combination or reclassification thereof, or issue or grant
                  any option, warrant, call, commitment, subscription, right or
                  agreement to purchase relating to the authorized or issued
                  capital stock of the Bank, declare, set aside or pay any
                  dividend or other distribution with respect to the
                  outstanding capital stock of the Bank;

         (iii)    incur any material liabilities or material obligations (other
                  than deposit liabilities and short-term borrowings in the
                  ordinary course of business), whether directly or by way of
                  guaranty, including any obligation for borrowed money, or
                  whether evidenced by any note, bond, debenture, or similar
                  instrument, except in the ordinary course of business
                  consistent with past practice;

         (iv)     make any capital expenditures individually in excess of
                  $25,000, or in the aggregate in excess of $50,000 other than
                  pursuant to binding commitments existing on December 31, 1997
                  and disclosed in a Disclosure Schedule delivered pursuant to
                  Article III of this Agreement or in the annexed Schedule
                  5.1(b) and other than expenditures necessary to maintain
                  existing assets in good repair;

         (v)      sell, transfer, convey or otherwise dispose of any parcel of
                  real property (including other real estate owned) or interest
                  therein or any tangible or intangible personal property
                  having a book value in excess of or in exchange for
                  consideration in excess of $25,000 for each such parcel or
                  interest;

         (vi)     pay any bonuses to any executive officer except pursuant to 
                  the terms of an enforceable written agreement described in
                  Disclosure Schedule 5.1(b) annexed hereto; enter into any
                  new, or amend in any respect any existing, employment,
                  consulting, non-competition or independent contractor
                  agreement with any person; alter the terms of any existing
                  incentive bonus or commission plan; adopt any new or amend in
                  any material respect any existing employee benefit plan,
                  except as may be required by law; grant any general increase
                  in compensation to its employees as a class or to its
                  officers except for non-executive officers in the ordinary
                  course of business and consistent with past practices and
                  policies or except in accordance with the terms of an
                  enforceable written agreement; grant any material increases
                  in fees or other increases in compensation or in other
                  benefits to any of its directors; or effect any change in any
                  material respect in retirement benefits to any class of
                  employees or officers, except as required by law;


                                      A-17
<PAGE>   155

         (vii)    enter into or extend any agreement, lease or license relating
                  to real property, tangible or intangible personal property or
                  any service or other function (including, without
                  limitation), data processing or bankcard functions) relating
                  to the Bank that involves an aggregate of $25,000;

         (viii)   increase or decrease the rate of interest paid on time
                  deposits or on certificates of deposit, except in a manner
                  and pursuant to policies consistent with the Bank's past
                  practices;

         (ix)     purchase or otherwise acquire any investment securities for
                  its own account having an average remaining life to maturity
                  greater than five years, or any asset-backed security, other
                  than those issued or guaranteed by the Government National
                  Mortgage Association, the Federal National Mortgage
                  Association or Home Loan Mortgage Corporation, or any
                  Derivative Contract; or

         (x)      acquire twenty percent (20%) or more of the assets or equity 
                  securities of any person or acquire direct or indirect
                  control of any person, other than in connection with (A) any
                  internal reorganization or consolidation involving existing
                  subsidiaries of the Bank or the Bank which has been approved
                  in advance in writing by SouthTrust, (B) foreclosures in the
                  ordinary course of business, (C) acquisitions of control by a
                  banking subsidiary in a fiduciary capacity or (D) the
                  creation of new subsidiaries organized to conduct and
                  continue activities otherwise permitted by this Agreement.

         Section 5.2       Current Information. During the period from the date 
of this Agreement to the Effective Time of the Merger or the time of
termination or abandonment of this Agreement, the Bank will cause one or more
of its designated representatives to confer on a regular and frequent basis
with representatives of SouthTrust and to report the general status of the
ongoing operations of the Bank. The Bank will promptly notify SouthTrust of any
material change in the normal course of business or the operations or the
properties of the Bank, the Bank or any of their respective subsidiaries any
governmental complaints, investigations or hearings (or communications
indicating that the same may be contemplated) affecting the Bank, the
institution or the threat of material litigation, claims, threats or causes of
action involving the Bank, and will keep SouthTrust fully informed of such
events. The Bank will furnish to SouthTrust, promptly after the preparation
and/or receipt by the Bank thereof, copies of its unaudited periodic financial
statements and call reports for the applicable periods then ended, and such
financial statements and call reports shall, upon delivery to SouthTrust, be
treated, for purposes of Section 3.3 hereof, as among the Financial Statements
of the Bank and the Call Reports of the Bank.

         Section 5.3       Access to Properties; Personnel and Records. (a) So 
long as this Agreement shall remain in effect, the Bank, shall permit
SouthTrust or its agents full access, during normal business hours, to the
properties of the Bank, and shall disclose and make available (together with
the right to copy) to SouthTrust and to its internal auditors, loan review
officers, attorneys, accountants and other representatives, all books, papers
and records relating to the assets, stock, properties, operations, obligations
and liabilities of the Bank, including all books of account (including the
general ledger), tax records, minute books of directors' and shareholders'
meetings, organizational documents, bylaws, contracts and agreements, filings
with any regulatory agency, examination reports, correspondence with regulatory
or taxing authorities, documents relating to assets, titles, abstracts,
appraisals, consultant's reports, plans affecting employees, securities
transfer records and stockholder lists, and any other assets, business
activities or prospects in which SouthTrust may have a reasonable interest, and
the Bank, shall use their reasonable best efforts to provide SouthTrust and its
representatives access to the work papers of the Bank's accountants. The Bank
shall not be required to provide access to or to disclose information where
such access or disclosure would violate or prejudice the rights of any
customer, would contravene any law, rule, regulation, order or judgment or
would violate any confidentiality agreement; provided that the Bank, shall
cooperate with SouthTrust in seeking to obtain Consents from appropriate
parties under whose rights or authority access is otherwise restricted. The
foregoing rights granted to SouthTrust shall not, whether or not and regardless
of the extent to which the same are exercised, affect the representations and
warranties made in this Agreement by the Bank.

                  (b)      All information furnished by the parties hereto
pursuant to this Agreement shall be treated as the sole property of the party
providing such information until the consummation of the Merger contemplated
hereby and, if such transaction shall not occur, the party receiving the
information shall return to the party which furnished such information, all
documents or other materials containing, reflecting or referring to such
information, shall use its best efforts to keep confidential all such
information, and shall not directly or indirectly use such information for any


                                      A-18
<PAGE>   156

competitive or other commercial purposes. The obligation to keep such
information confidential shall continue for two (2) years from the date the
proposed transactions are abandoned but shall not apply to (i) any information
which (A) the party receiving the information was already in possession of
prior to disclosure thereof by the party furnishing the information, (B) was
then available to the public, or (C) became available to the public through no
fault of the party receiving the information; or (ii) disclosures pursuant to a
legal requirement or in accordance with an order of a court of competent
jurisdiction or regulatory agency; provided that the party which is the subject
of any such legal requirement or order shall use its best efforts to give the
other party at least ten (10) business days prior notice thereof. Each party
hereto acknowledges and agrees that a breach of any of their respective
obligations under this Section 5.3 would cause the other irreparable harm for
which there is no adequate remedy at law, and that, accordingly, each is
entitled to injunctive and other equitable relief for the enforcement thereof
in addition to damages or any other relief available at law.

         Section 5.4       Approval of the Bank Shareholders. The Bank will
take all steps necessary under applicable laws to call, give notice of, convene
and hold a meeting of its shareholders at such time as may be mutually agreed
to by the parties for the purpose of approving this Agreement and the
transactions contemplated hereby and for such other purposes consistent with
the complete performance of this Agreement as may be necessary or desirable.
The Board of Directors of the Bank will recommend to its shareholders the
approval of this Agreement and the transactions contemplated hereby and the
Bank will use its best efforts to obtain the necessary approvals by its
shareholders of this Agreement and the transactions contemplated hereby.

         Section 5.5       No Other Bids. The Bank (or any Affiliate thereof),
acting through any director or officer or other agent shall not now, nor shall
it authorize or knowingly permit any officer, director or employee of, or any
investment banker, attorney, accountant or other representative retained by the
Bank, to solicit or encourage, including by way of furnishing information, any
inquiries or the making of any proposal which may reasonably be expected to
lead to any takeover proposal with respect to the Bank. The Bank shall promptly
advise SouthTrust orally and in writing of any such inquiries or proposals
received by the Bank, after the date hereof. As used in this Section 5.5,
"takeover proposal" shall mean any proposal for a merger or other business
combination involving the Bank or for the acquisition of a significant equity
interest in the Bank, or for the acquisition of a significant portion of the
assets of the Bank.

         Notwithstanding the foregoing, the Bank may furnish information
concerning its business, properties or assets to a corporation, partnership,
person or other entity or group (a "Third Party") which has initiated the
possibility of effecting a transaction with the Bank and has expressed an
intention to make a bona fide offer or proposal to the Bank to acquire the Bank
and , following receipt of a bona fide offer or proposal, from such Third
Party, may negotiate and take any of the actions otherwise prohibited by this
Section 5.5, including without limitation, entering into appropriate agreements
with such Third Party if the Board of Directors of the Bank believes in good
faith, after consultation with its financial advisor, that such actions would
result in a superior financial transaction for Bank shareholders, and if
outside counsel to the Bank provides a written opinion to the Board of
Directors of the Bank to the effect that the failure to furnish such
information, or negotiate or enter into appropriate agreements with such Third
Party, would subject Bank Directors to liability for breach of their fiduciary
duties.

         Section 5.6       Notice of Deadlines. The Bank shall notify
SouthTrust in writing of any deadline to exercise an extension or termination
of any material lease, agreement or license (including specifically real
property leases and data processing agreements) to which the Bank is a party,
at least ten (10) days prior to such deadline.

         Section 5.7       Affiliates. At least thirty (30) days prior to the
Effective Time of the Merger, the Bank shall deliver to SouthTrust a letter
identifying all persons who are, at the time this Agreement is submitted for
approval to the shareholders of the Bank, "affiliates" of the Bank for purposes
of Rule 145 under the Securities Act of 1933. The Bank shall use its reasonable
efforts to cause each person who is identified as an "affiliate" in the letter
referred to above to deliver to SouthTrust not later than thirty (30) days
prior to the Effective Time of the Merger, a written agreement providing that
such person will not sell, pledge, transfer, or otherwise dispose of the Bank
Shares held by such person, except as contemplated by such agreement or by this
Agreement, and will not sell, pledge, transfer, or otherwise dispose of the
SouthTrust Shares to be received by such person upon consummation of the Merger
except in compliance with applicable provisions of the Securities Act of 1933,
and the rules and regulations promulgated thereunder and until such time as the
financial results covering at least thirty (30) days of combined operations of
SouthTrust and the Bank have been published within the meaning of Section
201.01 of the SEC's Codification of Financial Reporting Policies. If the Merger
will qualify for pooling-of-interests accounting treatment, the SouthTrust
Shares issued to such affiliates of the Bank in exchange for the Bank Shares
shall not be transferable until such time as the financial results covering at
least thirty (30) days of combined operations of SouthTrust and the Bank have
been published within the meaning of Section 201.01 of the SEC's Codification
of Financial Reporting Policies regardless of whether each such person has
provided the written agreement referred to in this Section 5.7. SouthTrust
shall not be required to maintain the effectiveness of


                                      A-19
<PAGE>   157

the Registration Statement under the Securities Act of 1933 for the purposes of
resale of SouthTrust Shares by such persons.

         Section 5.8       Maintenance of Properties. The Bank, will maintain 
its properties and assets in satisfactory condition and repair for the purposes
for which they are intended, ordinary wear and tear excepted.

         Section 5.9       Environmental Audits. At the election of SouthTrust,
the Bank will, at its own expense, with respect to each parcel of real property
that the Bank owns, leases or subleases, procure and deliver to SouthTrust, at
least thirty (30) days prior to the Effective Time of the Merger, an
environmental audit, which audit shall be reasonably acceptable to and shall be
conducted by a firm reasonably acceptable to SouthTrust.

         Section 5.10      Title Insurance. At the election of SouthTrust, the 
Bank will, at its own expense, with respect to each parcel of real property
that the Bank, owns, leases or subleases, procure and deliver to SouthTrust, at
least thirty (30) days prior to the Effective Time of the Merger, owner's title
insurance issued in such amounts and by such insurance company reasonably
acceptable to SouthTrust, which policy shall be free of all material exceptions
to SouthTrust's reasonable satisfaction.

         Section 5.11      Surveys. At the election of SouthTrust, with respect
to each parcel of real property as to which a title insurance policy is to be
procured pursuant to Section 5.10, the Bank, at its own expense, will procure
and deliver to SouthTrust at least thirty (30) days prior to the Effective Time
of the Merger, a survey of such real property, which survey shall be reasonably
acceptable to and shall be prepared by a licensed surveyor reasonably
acceptable to SouthTrust, disclosing the locations of all improvements,
easements, sidewalks, roadways, utility lines and other matters customarily
shown on such surveys and showing access affirmatively to public streets and
roads and providing the legal description of the property in a form suitable
for recording and insuring the title thereof (the "Survey"). The Survey shall
not disclose any survey defect or encroachment from or onto such real property
that has not been cured or insured over prior to the Effective Time of the
Merger.

         Section 5.12      Compliance Matters. Prior to the Effective Time of 
the Merger, the Bank shall take, or cause to be taken, all steps reasonably
requested by SouthTrust to cure any deficiencies in regulatory compliance by
the Bank, including compliance with Regulations Z and CC of the FRB; provided
that neither SouthTrust nor ST-Bank shall be responsible for discovering or
have any obligation to disclose the existence of such defects to the Bank nor
shall SouthTrust or ST-Bank have any liability resulting from such deficiencies
or attempts to cure them.

         Section 5.13      Exemption Under Anti-Takeover Statutes. Prior to the
Effective Time of the Merger, the Bank will use its best efforts to take all
steps required to exempt the transactions contemplated by this Agreement from
any applicable state anti-takeover law.


                                   ARTICLE VI

                      ADDITIONAL COVENANTS AND AGREEMENTS


         Section 6.1       Best Efforts; Cooperation. Subject to the terms and
conditions herein provided, each of the parties hereto agrees to use its best
efforts promptly to take, or cause to be taken, all actions and to do, or cause
to be done, all things necessary, proper or advisable under applicable laws and
regulations, or otherwise, including attempting to obtain all necessary
Consents, to consummate and make effective, as soon as practicable, the
transactions contemplated by this Agreement.

         Section 6.2       Regulatory Matters. (a) Following the execution and
delivery of this Agreement, SouthTrust and the Bank shall cause to be prepared
and filed all required applications and filings with the Regulatory Authorities
which are necessary or contemplated for the obtaining of the Consents of the
Regulatory Authorities or consummation of the Merger. Such applications and
filings shall be in such form as may be prescribed by the respective government
agencies and shall contain such information as they may require. The parties
hereto will cooperate with each other and use their best efforts to prepare and
execute all necessary documentation, to effect all necessary or contemplated
filings and to obtain all necessary or contemplated permits, consents,
approvals, rulings and authorizations of government agencies and third parties
which are necessary or contemplated to consummate the transactions contemplated
by this Agreement, including, without limitation, those required or
contemplated from the Regulatory Authorities, and the shareholders of the Bank.
Each of the parties shall have the right to review and approve in advance,
which approval shall not be unreasonably withheld, any filing made with, or
written material submitted to, any government agencies in connection with the
transactions contemplated by this Agreement.


                                      A-20
<PAGE>   158

                  (b)      Each party hereto will furnish the other party with 
all information concerning itself, its subsidiaries, directors, trustees,
officers, shareholders and depositors, as applicable, and such other matters as
may be necessary or advisable in connection with any statement or application
made by or on behalf of any such party to any governmental body in connection
with the transactions, applications or filings contemplated by this Agreement.
Upon request, the parties hereto will promptly furnish each other with copies
of written communications received by them or their respective subsidiaries
from, or delivered by any of the foregoing to, any governmental body in respect
of the transactions contemplated hereby.

         Section 6.3       Other Matters. (a) The parties acknowledge that
nothing in this Agreement shall be construed as constituting an employment
agreement between SouthTrust or any of its affiliates and any officer or
employee of the Bank, or an obligation on the part of SouthTrust or any of its
affiliates to employ any such officers or employees.

                  (b)      Except as provided in Section 6.3(c) below, the 
parties agree that appropriate steps shall be taken to terminate all employee
benefit plans of the Bank as of the Effective Time of the Merger or as promptly
as practicable thereafter. Following the termination of all such plans, and
except as otherwise provided in Section 6.3(c) hereof, SouthTrust agrees that
the officers and employees of the Bank who the Surviving Corporation employs
shall be eligible to participate in SouthTrust's employee benefit plans,
including welfare and fringe benefit plans on the same basis as and subject to
the same conditions as are applicable to any newly-hired employee of
SouthTrust; provided, however, that:

                           (i)      with respect to each SouthTrust group health
                  plan (within the meaning of Section 5000(b)(1) of the Code,
                  SouthTrust shall credit each such employee for eligible
                  expenses incurred by such employee and his or her dependents
                  (if applicable) under the Bank's group medical insurance plan
                  during the current calendar year for purposes of satisfying
                  the health plan deductible provisions under SouthTrust's plan
                  for such current year, and SouthTrust shall waive all waiting
                  periods under said plans for pre-existing conditions; and

                           (ii)     credit for each such employee's past service
                  with the Bank, prior to the Effective Time of the Merger
                  ("Past Service Credit") shall be given by SouthTrust to
                  employees for purposes of:

                                    (A)      determining vacation and sick leave
                           benefits and accruals, in accordance with the
                           established policies of SouthTrust;

                                    (B)      subject to Section 6.3(c) below,
                           establishing eligibility for participation in and
                           vesting under SouthTrust's employee benefit plans
                           (including welfare and fringe benefit plans), and
                           for purposes of determining the scheduling of
                           vacations and other determinations which are made
                           based on length of service; provided, however,
                           notwithstanding anything contained in this Agreement
                           to the contrary, past service credit shall not be
                           given to any such employee for purposes of
                           establishing eligibility for participation in the
                           1990 Discounted Stock Plan of SouthTrust.

                  (c)      The parties further agree that the Bank 401(k) Plan 
will either be merged into the SouthTrust Corporation Employee's Profit Sharing
Plan (the "STPS Plan") effective as of January 1 of the year following the
Effective Time of the Merger or, if so elected by SouthTrust, terminated as of
a date prior to, on or after the Effective Time of the Merger and prior to such
January 1. The determination as to whether the Bank 401(k) Plan shall be
terminated or merged into the STPS Plan shall be made by SouthTrust. From and
after the January 1 following the Effective Time of the Merger, for purposes of
determining eligibility to participate in, and vesting in accrued benefits
under, the STPS Plan and the SouthTrust Corporation Revised Retirement Income
Plan (the "ST Retirement Plan") employment by the Bank shall be credited as if
it were employment by SouthTrust, but such service shall not be credited for
purposes of determining benefit accrual under the ST Retirement Plan.

         Section 6.4       Indemnification. (a) The Bank agrees to indemnify, 
defend and hold harmless SouthTrust and its subsidiaries, and each of their
respective present and former officers, directors, employees and agents, from
and against all losses, expenses, claims, damages or liabilities to which any
of them may become subject under applicable laws (including, but not limited
to, the Securities Act of 1933 or the Securities Exchange Act of 1934), and
will reimburse each of them for any legal, accounting or other expenses
reasonably incurred in connection with investigating or defending any such
actions, whether or not resulting in liability, insofar as such losses,
expenses, claims, damages or liabilities arise out of or are based upon any
untrue statement or alleged untrue statement of material fact (that is based on
information provided by or statements made by the Bank) contained in the
Registration Statement, the Proxy Statement or any application for the approval
of the transactions contemplated by this Agreement filed with any


                                      A-21
<PAGE>   159

Regulatory Authority or arise out of or are based upon the omission or alleged
omission to state therein a material fact necessary to make the statements
therein, in light of the circumstances under which they were made not
misleading.

                  (b)      SouthTrust agrees to indemnify, defend and hold 
harmless the Bank and each of its respective present and former officers,
directors, employees and agents, from and against all losses, expenses, claims,
damages or liabilities to which any of them may become subject under applicable
laws (including, but not limited to, the Securities Act of 1933 or the
Securities Exchange Act of 1934), and will reimburse each of them for any
legal, accounting or other expenses reasonably incurred in connection with
investigating or defending any such actions, whether or not resulting in
liability, insofar as such losses, expenses, claims, damages or liabilities
arise out of or are based upon any untrue statement or alleged untrue statement
of material fact (that is based on information provided by or statements made
by SouthTrust and about SouthTrust or ST-Bank) contained in the Registration
Statement, the Proxy Statement or any application for the approval of the
transactions contemplated by this Agreement filed with any Regulatory Authority
or arise out of or are based upon the omission or alleged omission to state
therein a material fact necessary to make the statements therein, in light of
the circumstances under which they were made not misleading.

                  (c)      For a period of three (3) years after the Effective 
Time of the Merger, SouthTrust shall indemnify, defend and hold harmless each
person entitled to indemnification from the Bank (each, an "Indemnified Party")
against all liabilities arising out of actions or omissions occurring at or
prior to the Effective Time of the Merger (including, without limitation, the
transactions contemplated by this Agreement (to the same extent and subject to
the conditions set forth in the Bank's Articles of Incorporation and Bylaws, in
each case as in effect on the date hereof).

                  (d)      After the Effective Time of the Merger, directors,
officers and employees of the Bank, except for the indemnification rights
provided for in this Section 6.4 above, shall have indemnification rights
having prospective application only. These prospective indemnification rights
shall consist of such rights to which directors, officers and employees of
SouthTrust and its subsidiaries would be entitled under the Restated
Certificate or Certificate or Articles of Incorporation and Bylaws of
SouthTrust or the particular subsidiary for which they are serving as officers,
directors or employees and under such directors' and officers' liability
insurance policy as SouthTrust may then make available to officers, directors
and employees of SouthTrust and its subsidiaries.

                  (e)      SouthTrust shall use its reasonable efforts (and the
Bank shall cooperate prior to the Effective Time of the Merger in these
efforts) to maintain in effect for a period of three (3) years after the
Effective Time of the Merger the Bank's existing directors' and officers'
liability insurance policy (provided that SouthTrust may substitute therefor
(i) policies of at least the same coverage and amounts containing terms and
conditions which are substantially no less advantageous or (ii) with the
consent of the Bank (given prior to the Effective Time of the Merger) any other
policy with respect to claims arising from facts or events which occurred prior
to the Effective Time of the Merger and covering persons who are currently
covered by such insurance; provided, that SouthTrust shall not be obligated to
make premium payments for such three (3)-year period in respect of such policy
(or coverage replacing such policy) which exceed, for the portion related to
the Bank's and the Bank's directors and officers, 200% of the annual premium
payments on the Bank's current policy, as in effect as of the date of this
Agreement (the "Maximum Amount"). If the amount of premium that is necessary to
maintain or procure such insurance coverage exceeds the Maximum Amount,
SouthTrust shall use its reasonable efforts to maintain the most advantageous
policies of directors' and officers' liability insurance obtainable for a
premium equal to the Maximum Amount.

                  (f)      If SouthTrust or any of its successors or assigns 
shall consolidate with or merge into any other person and shall not be the
continuing and surviving person of such consolidation or merger, or shall
transfer all or substantially all of its assets to any person, then, and in
each case, proper provisions shall be made so that the successors and assigns
of SouthTrust shall assume the obligations set forth in this Section 6.4.

         Section 6.5       Current Information. During the period from the date
of this Agreement to the Effective Time of the Merger or the time of
termination or abandonment hereunder, SouthTrust will cause one or more of its
designated representatives to confer on a regular and frequent basis with the
Bank and to report with respect to the general status and the ongoing
operations of SouthTrust.

         Section 6.6       Registration Statement. SouthTrust shall cause the
Registration Statement to be filed and shall use its best efforts to cause such
Registration Statement to be declared effective under the Securities Act of
1933, which Registration Statement, at the time it becomes effective, and at
the Effective Time of the Merger, shall in all material respects conform to the
requirements of the Securities Act of 1933 and the general rules and
regulations of the SEC under the Securities Act of 1933. The Registration
Statement shall include the form of Proxy Statement for the meeting of the
Bank's shareholders to be held for the purpose of having such shareholders vote
upon the approval of this Agreement. The Bank will furnish to SouthTrust the
information required to be included in the Registration


                                      A-22
<PAGE>   160

Statement with respect to its business and affairs before it is filed with the
SEC and again before any amendments are filed. SouthTrust shall take all
actions required to qualify or obtain exemptions from such qualifications for
the SouthTrust Shares to be issued in connection with the transactions
contemplated by this Agreement under applicable state blue sky securities laws,
as appropriate.

         Section 6.7       Reservation of Shares. SouthTrust shall reserve for
issuance such number of SouthTrust Shares as shall be necessary (i) to pay the
consideration contemplated in this Agreement and (ii) to comply with the
provisions of Section 2.2(b). If at any time the aggregate number of SouthTrust
Shares remaining unissued (or in treasury) shall not be sufficient to meet such
obligation, SouthTrust shall take all appropriate actions to increase the
amount of its authorized common stock.

         Section 6.8       Consideration. SouthTrust shall issue the SouthTrust
Shares and shall pay or cause to be paid all cash payments as and when the same
shall be required to be issued and paid pursuant to this Agreement.

         Section 6.9       Advisory Board.  As of the Closing Date, SouthTrust
shall name an Advisory Board of Directors to serve on behalf of SouthTrust
Bank, N.A. - First American Bank of Indian River County following the closing.

         Section 6.10      ST-Bank Shareholder Approval. SouthTrust, as the sole
shareholder of ST-Bank, shall approve this Agreement and the Merger to the
extent required under applicable law.


                                  ARTICLE VII

                          MUTUAL CONDITIONS TO CLOSING


         The obligations of SouthTrust and ST-Bank, on the one hand, and the
Bank, on the other hand, to consummate the transactions provided for herein
shall be subject to the satisfaction of the following conditions, unless waived
as hereinafter provided for:

         Section 7.1       Shareholder Approval.  The Merger shall have been
approved by the requisite vote of the shareholders of the Bank.

         Section 7.2       Regulatory Approvals. All necessary Consents of the
Regulatory Authorities shall have been obtained and all notice and waiting
periods required by law to pass after receipt of such Consents shall have
passed, and all conditions to consummation of the Merger set forth in such
Consents shall have been satisfied.

         Section 7.3       Legal Proceedings. (a) There shall be no actual or
threatened causes of action, investigations or proceedings (i) challenging the
validity or legality of this Agreement or the consummation of the transactions
contemplated by this Agreement, or (ii) seeking damages in connection with the
transactions contemplated by this Agreement, or (iii) seeking to restrain or
invalidate the transactions contemplated by this Agreement, which, in the case
of (i) through (iii), and in the reasonable judgment of either SouthTrust or
the Bank, based upon advice of counsel, would have a Material Adverse Effect
with respect to the interests of SouthTrust or the Bank, as the case may be.

                  (b)      No court or governmental or regulatory authority of 
any competent jurisdiction shall have enacted, issued, promulgated, enforced or
entered any law, order or similar restriction (whether temporary, preliminary
or permanent) or taken any other action which prohibits or makes illegal the
consummation of the transactions contemplated by this Agreement.

         Section 7.4       Proxy Statement and Registration Statement. The
Registration Statement shall have been declared effective by the SEC, no stop
order suspending the effectiveness of the Registration Statement shall have
been issued, no action, suit, proceeding or investigation by the SEC to suspend
the effectiveness of the Registration Statement shall have been initiated, and
SouthTrust shall have received all state securities laws, or "Blue Sky" permits
or other authorizations, or confirmations as to the availability of exemptions
from registration requirements, as may be necessary to issue the SouthTrust
Shares pursuant to the terms of this Agreement.


                                  ARTICLE VIII

            CONDITIONS TO THE OBLIGATIONS OF SOUTHTRUST AND ST-BANK


         The obligations of SouthTrust and ST-Bank to consummate the Merger are
subject to the fulfillment of each of the following conditions, unless waived
as hereinafter provided for:


                                      A-23
<PAGE>   161

         Section 8.1       Representations and Warranties. The representations 
and warranties of the Bank set forth in this Agreement and in any certificate
or document delivered pursuant hereto shall be true and correct in all material
respects as of the date of this Agreement and as of all times up to and
including the Effective Time of the Merger (as though made on and as of the
Effective Time of the Merger except to the extent such representations and
warranties are by their express provisions made as of a specified date and
except for changes therein contemplated by this Agreement).

         Section 8.2       Performance of Obligations. The Bank shall have 
performed all covenants, obligations and agreements required to be performed by
it under this Agreement prior to the Effective Time of the Merger.

         Section 8.3       Certificate Representing Satisfaction of Conditions. 
The Bank shall have delivered to SouthTrust and ST-Bank a certificate dated as
of the Closing Date as to the satisfaction of the matters described in Sections
8.1 and 8.2 hereof, and such certificate shall be deemed to constitute
additional representations, warranties, covenants, and agreements of the Bank
under Article III of this Agreement.

         Section 8.4       Absence of Adverse Facts. There shall have been no
determination by SouthTrust that any fact, event or condition exists or has
occurred that, in the judgment of SouthTrust (a) would have a Material Adverse
Effect on, or which may be foreseen to have a Material Adverse Effect on, the
Bank or the consummation of the transactions contemplated by this Agreement,
(b) relates to or affects the Bank, and would significantly and materially
adversely affect the economic benefits reasonably and good faith expected to be
obtained by SouthTrust from consummating the transactions contemplated by this
Agreement, including, without limitation, a significant and material adverse
effect with respect to the Bank's consolidated financial condition or results
of operation, credit quality or allowance for possible loan losses or any item
related thereto, (c) would be materially adverse to the interests of SouthTrust
on a consolidated basis or (d) would render the Merger or the other
transactions contemplated by this Agreement impractical because of any state of
war, national emergency, banking moratorium or general suspension of trading on
NASDAQ, the New York Stock Exchange, Inc. or other national securities
exchange.

         Section 8.5       Opinion of Counsel. SouthTrust shall have received an
opinion of counsel from Smith, Mackinnon, Greeley, Bowdoin & Edwards, P.A. or
other counsel to the Bank acceptable to SouthTrust in substantially the form
set forth in Exhibit 8.5 hereof.

         Section 8.6       Consents Under Agreements. The Bank shall have
obtained the consent or approval of each person (other than the Consents of the
Regulatory Authorities) whose consent or approval shall be required in order to
permit the succession by the Surviving Corporation to any obligation, right or
interest of the Bank under any loan or credit agreement, note, mortgage,
indenture, lease, license, or other agreement or instrument, except those for
which failure to obtain such consents and approvals would not in the opinion of
SouthTrust, individually or in the aggregate, have a Material Adverse Effect on
the Surviving Corporation or upon the consummation of the transactions
contemplated by this Agreement.

         Section 8.7       Material Condition. There shall not be any action 
taken, or any statute, rule, regulation or order enacted, entered, enforced or
deemed applicable to the Merger by any Regulatory Authority which, in
connection with the grant of any Consent by any Regulatory Authority, imposes,
in the judgment of SouthTrust, any material adverse requirement upon SouthTrust
or its subsidiaries, including, without limitation, any requirement that
SouthTrust sell or dispose of any significant amount of the assets of the Bank
or any other banking or other subsidiary of SouthTrust, provided that, except
for any such requirement relating to the above-described sale or disposition of
any significant assets of the Bank or any banking or other subsidiary of
SouthTrust, no such term or condition imposed by any Regulatory Authority in
connection with the grant of any Consent by any Regulatory Authority shall be
deemed to be a material adverse requirement unless it materially differs from
terms and conditions customarily imposed by any such entity in connection with
the acquisition of banks, savings associations and bank and savings association
holding companies under similar circumstances.

         Section 8.8       Matters Relating to Employment Agreements. All 
employment agreements, except those identified in the last sentence of this
Section 8.8, between the Bank and any executive or employee thereof shall be
terminated in their entirety as of the Effective Time of the Merger, and at the
election of SouthTrust, replacement employment agreements, which are
satisfactory to SouthTrust and such employees, between each of such executives
or employees and SouthTrust or the Surviving Corporation shall have been
executed and delivered. Stay pay agreements satisfactory to SouthTrust and such
employees, shall have been executed and delivered by each of Steven C.
Shackley, Audrey F. Glover, and Michael Float, and replacement employment
agreements, satisfactory to SouthTrust and such employees, shall have been
executed and delivered by each of Robert J. MacWilliam and Steven C. Shackley.

         Section 8.9       Outstanding Shares of the Bank.  The total number of 
Bank Shares outstanding as of the Effective Time of the Merger and the total
number of Bank Shares covered by any option, warrant, commitment, or


                                      A-24
<PAGE>   162

other right or instrument to purchase or acquire any the Bank Shares that are
outstanding as of the Effective Time of the Merger, including any securities or
rights convertible into or exchangeable for Bank Shares, shall not exceed
134,365 shares in the aggregate.

         Section 8.10      Dissenters. The holders of not more than five percent
(5%) of the outstanding Bank Shares shall have elected to exercise their right
to dissent from the Merger and demand payment in cash for the fair or appraised
value of their shares.

         Section 8.11      Certification of Claims. The Bank shall have
delivered a certificate to SouthTrust that the Bank is not aware of any pending
or threatened claim under the directors and officers insurance policy or the
fidelity bond coverage of the Bank.

         Section 8.12      Pooling. SouthTrust, in the exercise of its 
reasonable discretion, and after taking into account the holders of the
outstanding Bank shares who shall have elected to exercise their right to
dissent from the Merger and demand payment in cash for the fair or appraised
value of their shares, shall not have determined that the transactions
contemplated by this Agreement fail to qualify for pooling of interests
accounting treatment.

         Section 8.13      Signs. The Bank shall have obtained the written 
agreement of Puttick Enterprises, Inc. ("Landlord"), to change the name of the
building owned by Landlord and occupied in part by the Bank pursuant to that
certain lease dated February 8, 1995, from "First American Bank Building" to
"SouthTrust Bank Building" or such other name that does not include a reference
to any bank or banking institution other than SouthTrust or ST-Bank, which name
change shall be effective as of the Effective Time of the Merger. The Bank also
shall have obtained the written agreement of Landlord to permit, as of the
Effective Time of the Merger, interior and exterior signs on the leased
premises identifying SouthTrust or ST-Bank, and shall have made arrangements
for the removal of all interior and exterior signs identifying First American
Bank, which removal shall occur as promptly as possible following the Effective
Time of the Merger.


                                   ARTICLE IX

                     CONDITIONS TO OBLIGATIONS OF THE BANK


         The obligation of the Bank to consummate the Merger as contemplated
herein is subject to each of the following conditions, unless waived as
hereinafter provided for:

         Section 9.1       Representations and Warranties. The representations 
and warranties of SouthTrust and ST- Bank contained in this Agreement or in any
certificate or document delivered pursuant to the provisions hereof will be
true and correct as of the Effective Time of the Merger (as though made on and
as of the Effective Time of the Merger).

         Section 9.2       Performance of Obligations. SouthTrust and ST-Bank
shall have performed all covenants, obligations and agreements required to be
performed by them and under this Agreement prior to the Effective Time of the
Merger.

         Section 9.3       Certificate Representing Satisfaction of Conditions.
SouthTrust and ST-Bank shall have delivered to the Bank a certificate dated as
of the Effective Time of the Merger as to the satisfaction of the matters
described in Sections 9.1 and 9.2 hereof, and such certificate shall be deemed
to constitute additional representations, warranties, covenants, and agreements
of SouthTrust and ST-Bank under Article IV of this Agreement.

         Section 9.4       Absence of Adverse Facts. There shall have been no
determination by the Bank that any fact, event or condition exists or has
occurred that, in the judgment of the Bank, (a) would have a Material Adverse
Effect on, or which may be foreseen to have a Material Adverse Effect on, the
Condition of SouthTrust on a consolidated basis or the consummation of the
transactions contemplated by this Agreement, or (b) would render the Merger or
the other transactions contemplated by this Agreement impractical because of
any state of war, national emergency, banking moratorium, or a general
suspension of trading on NASDAQ, the New York Stock Exchange, Inc. or other
national securities exchange.

         Section 9.5       Consents Under Agreements. SouthTrust and ST-Bank 
shall have obtained the consent or approval of each person (other than the
Consents of Regulatory Authorities) whose consent or approval shall be required
in connection with the transactions contemplated hereby under any loan or
credit agreement, note, mortgage, indenture, lease, license or other agreement
or instrument, except those for which failure to obtain such consents and
approvals would not, in the judgment of the Bank, individually or in the
aggregate, have a Material Adverse Effect upon the consummation of the
transactions contemplated hereby.


                                      A-25
<PAGE>   163

         Section 9.6       Opinion of Counsel. The Bank shall have received the
opinion of Bradley Arant Rose & White LLP, counsel to SouthTrust, dated the
Effective Time of the Merger, to the effect set forth in Exhibit 9.6 hereof.

         Section 9.7       SouthTrust Shares. The SouthTrust Shares to be
issued in connection herewith shall be duly authorized and validly issued and,
fully paid and nonassessable, issued free of preemptive rights and free and
clear of all liens and encumbrances created by or through SouthTrust.

         Section 9.8       Tax Opinion. The Bank shall have received an opinion 
of the Bank's independent public accountants, on or before the date on which
the Proxy Statement of the Bank is to be mailed to holders of the Bank Shares,
to the effect, among others, that the Merger will constitute a reorganization
within the meaning of Section 368 of the Code and that no gain or loss will be
recognized by the shareholders of the Bank to the extent that they receive
SouthTrust Shares in exchange for their the Bank Shares in the Merger.

         Section 9.9       Fairness Opinion.  The Bank shall have received an 
opinion from Allen C. Ewing & Co. dated the date of the Proxy Statement
referred to in Section 3.27 to the effect that the terms of the Merger are fair
to the shareholders of the Bank from a financial point of view.

         Section 9.10      NASDAQ Listing. The SouthTrust Shares to be issued
pursuant to this Agreement shall have been approved for listing on NASDAQ.


                                   ARTICLE X

                       TERMINATION, WAIVER AND AMENDMENT


         Section 10.1      Termination.  This Agreement may be terminated and 
the Merger abandoned at any time prior to the Effective Time of the Merger:

                  (a)      by the mutual consent in writing of SouthTrust and
the Bank; or

                  (b)      by SouthTrust or the Bank if the Merger shall not
have occurred on or prior to February 28, 1999, provided that the failure to
consummate the Merger on or before such date is not accompanied by any breach
of any of the representations, warranties, covenants or other agreements
contained herein by the party electing to terminate pursuant to this Section
10.1(b);

                  (c)      by SouthTrust or the Bank (provided that the
terminating party is not then in breach of any representation, warranty,
covenant or other agreement contained herein) in the event that any of the
conditions to the obligations of the nonterminating party to consummate the
Merger, as set forth in Articles VIII and IX, as the case may be, cannot be
satisfied or fulfilled;

                  (d)      by SouthTrust if: (i) SouthTrust shall have
determined that any fact, event or condition exists that, in the judgment of
SouthTrust, (A) is materially at variance with any warranty or representation
of the Bank, set forth in the Agreement or is a material breach of any covenant
or agreement of the Bank, contained in the Agreement, (B) has a Material
Adverse Effect or can be reasonably foreseen to have a Material Adverse Effect
upon the Condition of the Bank on a consolidated basis or upon the consummation
of the transactions contemplated by the Agreement, (C) would be materially
adverse to the interests of SouthTrust and ST-Bank on a consolidated basis, (D)
relates to or affects the Bank, and would significantly and materially
adversely affect the economic benefits reasonably and good faith expected to be
obtained by SouthTrust from consummating the transaction contemplated by this
Agreement, including, without limitation, a significant and material adverse
effect with respect to the Bank's consolidated financial condition or results
of operation, credit quality or allowance for possible loan losses or any item
related thereto, (E) renders the Merger or the other transactions contemplated
by this Agreement impractical because of any state of war, national emergency,
banking moratorium or general suspension of trading on NASDAQ, the New York
Stock Exchange, Inc. or any other national securities exchange; or (ii) there
shall be any litigation or threat of litigation (A) challenging the validity or
legality of this Agreement or the consummation of the transactions contemplated
by this Agreement, (B) seeking damages in connection with the consummation of
the transactions contemplated by this Agreement or (C) seeking to restrain or
invalidate the consummation of the transactions contemplated by this Agreement.

                  (e)      by the Bank if (i) the Bank shall have determined 
that any fact, event or condition exists that, in the judgment of the Bank, (A)
is materially at variance with any warranty or representation of SouthTrust or
ST-Bank contained in the Agreement or is a material breach of any covenant or
agreement of SouthTrust or ST-Bank contained in the Agreement, (B) has a
Material Adverse Effect or can be reasonably seen to have a Material Adverse
Effect upon the consummation of the transactions contemplated by the Agreement,
(ii) there shall be any litigation or threat of


                                      A-26
<PAGE>   164

litigation (A) challenging the validity or legality of this Agreement or the
consummation of the transactions contemplated by this Agreement, (B) seeking
damages in connection with the consummation of the transactions contemplated by
this Agreement or (C) seeking to restrain or invalidate the consummation of
transactions contemplated by this Agreement, or (iii) the Bank shall have
determined that any fact, event or condition exists that, in the judgment of
the Bank, would render the Merger and the other transactions contemplated by
this Agreement impractical because of any state of war, national emergency,
banking moratorium or general suspension of trading on NASDAQ, the New York
Stock Exchange, Inc. or other national securities exchange.

                  (f)      by the Board of Directors of the Bank, if it 
determines by a vote of a majority of the members of its entire Board, at any
time during the ten-day period commencing two days after the Determination
Date, if:

                  (i)      both of the following conditions are satisfied:

                           (A)      the Average Closing Price as of the 
Determination Date shall be less than the Average Closing Price as of June 26,
1998; and

                           (B)      (x) the quotient obtained by dividing the
Average Closing Price on the Determination Date by the Average Closing Price on
the Starting Date (such number being referred to herein as the "SouthTrust
Ratio") shall be less than (y) the quotient obtained by dividing the Index
Price on the Determination Date by the Index Price on the Starting Date (such
number being referred to herein as the "Index Ratio");

subject, however, to the following four sentences. If the Bank refuses to
consummate the Merger pursuant to this Section 10.1(f), it shall give prompt
written notice thereof to SouthTrust; provided, that such notice of election to
terminate may be withdrawn at any time within the aforementioned ten-day
period. During the five-day period commencing with its receipt of such notice,
SouthTrust shall have the option to elect to increase the Conversion Ratio to
equal (A) the quotient obtained by dividing (1) $10,000,000 by (2) the Average
Closing Price on the Determination Date. If SouthTrust makes the election
contemplated above, within such five-day period, it shall give prompt written
notice to the Bank of such election and the revised Conversion Ratio, whereupon
no termination shall have occurred pursuant to this Section 10.1(f) and this
Agreement shall remain in effect in accordance with its terms (except as the
Conversion Ratio shall have been so modified), and any references in this
Agreement to "Conversion Ration" shall thereafter be deemed to refer to the
Conversion Ratio as adjusted pursuant to this Section 10.1(f).

         For purposes of this Section 10.1(f), the following terms shall have
the meanings indicated:

         "Average Closing Price" shall mean the average of the daily last sales
prices of SouthTrust Common Stock as reported on the Nasdaq National Market (as
reported by The Wall Street Journal or, if not reported thereby, another
authoritative source as chosen by SouthTrust) for the ten consecutive full
trading days in which such shares are traded on the Nasdaq National Market
ending at the close of trading on the date specified in this Agreement.

         "Determination Date" shall mean the date on which the Proxy Statement
is mailed to the shareholders of the Bank.

         "Index Group" shall mean the bank holding companies listed below, the
common stocks of all of which shall be publicly traded and as to which there
shall not have been, since the Starting Date and before the Determination Date,
any public announcement of a proposal for such company to be acquired or for
such company to acquire another company or companies in transactions with a
value exceeding 25% of the acquiror's market capitalization. In the event that
any such company or companies are removed from the Index Group, the weights
(which shall be determined based upon the number of outstanding shares of
common stock) shall be redistributed proportionately for purposes of
determining the Index Price. The bank holding companies and the weights
attributed to them are as follows:


                                      A-27
<PAGE>   165

<TABLE>
<CAPTION>
                        BANK HOLDING COMPANIES                                                           WEIGHTING
                        ----------------------                                                           ---------

<S>                                                                                                      <C>   
AmSouth Bancorporation..................................................................................   4.07%
BB&T Corporation........................................................................................   6.78
Compass Bancshares, Inc.................................................................................   3.34
Fifth Third Bancorp.....................................................................................   7.84
First American Corporation..............................................................................   2.96
First Security Corporation..............................................................................   5.86
First Tennessee National Corporation....................................................................   3.25
First Virginia Banks, Inc...............................................................................   2.62
Hibernia Corporation....................................................................................   6.62
Huntington Bancshares, Inc..............................................................................   9.68
Mercantile Bancorporation, Inc..........................................................................   6.60
Regions Financial Corporation...........................................................................   5.05
Star Banc Corporation...................................................................................   4.32
Summit Bancorp..........................................................................................   8.91
SunTrust Banks, Inc.....................................................................................  10.67
Union Planters Corporation..............................................................................   3.45
Wachovia Corporation....................................................................................   7.99
                                                                                                         ------

         Total.......................................................................................... 100.00%
</TABLE>


         "Index Price" on a given date shall mean the weighted average
(weighted in accordance with the factors listed above) of the closing prices of
the companies composing the Index Group.

         "Starting Date" shall mean the date of execution of this Agreement.

         If any company belonging to the Index Group or SouthTrust declares or
effects a stock dividend, reclassification, recapitalization, split-up,
combination, exchange of shares, or similar transaction between the Starting
Date and the Determination Date, the prices for the common stock of such
company or SouthTrust shall be appropriately adjusted for the purposes of
applying this Section 10.1(f).

                  (g)      by the Bank if, following receipt of a bona fide 
offer or proposal from a Third Party and in connection with certain actions
permitted under Section 5.5 of this Agreement, the Board of Directors of the
Bank believes in good faith, after consultation with its financial advisor,
that such termination of this Agreement and the entering into certain
appropriate agreements with such Third Party would result in a superior
financial transaction for Bank shareholders, and if outside counsel to the Bank
provides a written opinion to the Board of Directors of the Bank to the effect
that the failure to take such action would subject Bank Directors to liability
for breach of their fiduciary duties.

         Section 10.2      Effect of Termination; Break-Up Fee. (a) In the event
of the termination and abandonment of this Agreement, it shall terminate and
become void, without liability on behalf of any party, and have no effect,
except that the breaching party shall not be relieved of any liability under
Section 10.2(b) hereto or for an uncured willful breach of any representation,
warranty, covenant or agreement giving rise to such termination and except that
the provisions described in Section 10.5 below shall survive any such
termination.

                  (b)      If, after the date of this Agreement, an Acquisition
Transaction (as defined below) is offered, presented or proposed to the Bank
and (i) thereafter this Agreement and the Merger are not consummated by the
Bank and ST-Bank and SouthTrust and (ii) within one year after the later to
occur of (A) the termination of this Agreement or (B) the date the Acquisition
Transaction is offered, presented or proposed to the Board, an Acquisition
Transaction is consummated or a definitive agreement is entered into by the
Bank relating to an Acquisition Transaction (a "Trigger Event"), then upon the
occurrence of a Trigger Event and in lieu of any other rights and remedies of
SouthTrust, the Bank shall pay SouthTrust a cash amount of five hundred
thousand dollars ($500,000) as an agreed-upon break-up fee as the sole and
exclusive remedy of SouthTrust against the Bank; provided, however, that this
Section 10.2(b) shall not apply if this Agreement is terminated (i) by
SouthTrust under Section 10.1(d), (ii) by the Bank under Section 10.1(e),
10.1(f), or (iii) by SouthTrust and the Bank under Section 10.1(a) hereto.

                  (c)      "Acquisition Transaction" shall, with respect to the
Bank, mean any of the following: (i) a merger or consolidation, or any similar
transaction (other than the Merger) of any company with the Bank, (ii) a
purchase, lease or other acquisition of all or substantially all the assets of
the Bank, (iii) a purchase or other acquisition of "beneficial ownership" by
any "person" or "group" (as such terms are defined in Section 13(d)(3) of the
Securities Exchange Act) (including by way of merger, consolidation, share
exchange, or otherwise) which would cause such person or group to become the
beneficial owner of securities representing 10% or more of the voting power of
the Bank after the date of this Agreement, but excluding the acquisition of
beneficial ownership by any employee benefit plan maintained or sponsored by
the Bank, (iv) a tender or exchange offer to acquire securities representing
10% or more


                                      A-28
<PAGE>   166

of the voting power of the Bank, (v) a public proxy or consent solicitation
made to stockholders of the Bank seeking proxies in opposition to any proposal
relating to any of the transactions contemplated by this Agreement that has
been recommended by the Board of Directors of the Bank, (vi) the filing of an
application or notice with the Federal Reserve Board, the OCC, the OTS, or any
other federal or state regulatory authority (which application has been
accepted for processing) seeking approval to engage in one or more of the
transactions referenced in clauses (i) through (iv) above, or (vii) the making
of a bona fide offer to the Board of Directors of the Bank by written
communication, that is or becomes the subject of public disclosure, to engage
in one or more of the transactions referenced in clauses (i) through (v) above.

         Section 10.3      Amendments. To the extent permitted by law, this
Agreement may be amended by a subsequent writing signed by each of SouthTrust,
ST-Bank and the Bank.

         Section 10.4      Waivers. Subject to Section 11.11 hereof, prior to
or at the Effective Time of the Merger, SouthTrust and ST-Bank, on the one
hand, and the Bank, on the other hand, shall have the right to waive any
default in the performance of any term of this Agreement by the other, to waive
or extend the time for the compliance or fulfillment by the other of any and
all of the other's obligations under this Agreement and to waive any or all of
the conditions to its obligations under this Agreement, except any condition,
which, if not satisfied, would result in the violation of any law or any
applicable governmental regulation.

         Section 10.5      Non-Survival of Representations and Warranties. The
representations, warranties, covenants or agreements in this Agreement or in
any instrument delivered by SouthTrust, ST-Bank or the Bank shall not survive
the Effective Time of Merger, except that Article II and Sections 6.3, 6.4, 6.7
and 6.8 shall survive the Effective Time of the Merger, and any representation,
warranty or agreement in any agreement, contract, report, opinion, undertaking
or other document or instrument delivered hereunder in whole or in part by any
person other than SouthTrust, ST-Bank, or the Bank (or directors and officers
thereof in their capacities as such) shall survive the Effective Time of the
Merger; provided that no representation, warranty or agreement of SouthTrust,
ST-Bank, or the Bank contained herein shall be deemed to be terminated or
extinguished so as to deprive SouthTrust or ST-Bank, on the one hand, and the
Bank, on the other hand, of any defense at law or in equity which any of them
otherwise would have to any claim against them by any person, including,
without limitation, any shareholder or former shareholder of either party. No
representation or warranty in this Agreement shall be affected or deemed waived
by reason of the fact that SouthTrust, ST-Bank, or the Bank and/or its
representatives knew or should have known that any such representation or
warranty was, is, might be or might have been inaccurate in any respect.


                                   ARTICLE XI

                                 MISCELLANEOUS


         Section 12.1      Entire Agreement. This Agreement and the documents
referred to herein contain the entire agreement among SouthTrust, ST-Bank and
the Bank with respect to the transactions contemplated hereunder and this
Agreement supersedes all prior arrangements or understandings with respect
thereto, whether written or oral, including those letters of intent between the
parties dated April 20, 1998 and April 30, 1998. The terms and conditions of
this Agreement shall inure to the benefit of and be binding upon the parties
hereto and their respective successors. Nothing in this Agreement, expressed or
implied, is intended to confer upon any person, firm, corporation or entity,
other than the parties hereto and their respective successors, any rights,
remedies, obligations or liabilities under or by reason of this Agreement.

         Section 12.2      Definitions. Except as otherwise provided herein, the
capitalized terms set forth below (in their singular and plural forms as
applicable) shall have the following meanings:

                  "Affiliate" of a person shall mean (i) any other person
directly or indirectly through one or more intermediaries controlling,
controlled by or under common control of such person, (ii) any officer,
director, partner, employer or direct or indirect beneficial owner of any 10%
or greater equity or voting interest of such person or (iii) any other persons
for which a person described in clause (ii) acts in any such capacity.

                  "Consent" shall mean a consent, approval or authorization,
waiver, clearance, exemption or similar affirmation by any person pursuant to
any contract, permit, law, regulation or order, and "Regulatory Authorities"
shall mean, collectively, the Federal Trade Commission (the "FTC"), the United
States Department of Justice (the "Justice Department"), the Board of Governors
of the Federal Reserve System (the "FRB"), the Office of Thrift Supervision
(including its predecessor, the Federal Home Loan Bank Board) (the "OTS"), the
Office of the Comptroller of the Currency (the "OCC"), the Federal Deposit
Insurance Corporation (the "FDIC"), and all state regulatory agencies having


                                      A-29
<PAGE>   167

jurisdiction over the parties and their respective bank subsidiaries, the
National Association of Securities Dealers, Inc., all national securities
exchanges and the Securities and Exchange Commission (the "SEC").

                  "Environmental Law" means any federal, state, local or
foreign law, statute, ordinance, rule, regulation, code, license, permit,
authorization, approval, consent, order, judgment, decree, injunction or
agreement with any regulatory agency relating to (i) the protection,
preservation or restoration of the environment (including, without limitation,
air, water vapor, surface water, groundwater, drinking water supply, surface
soil, subsurface soil, plant and animal life or any other natural resource),
and/or (ii) the use, storage, recycling, treatment, generation, transportation,
processing, handling, labeling, production, release or disposal of any
substance presently listed, defined, designated or classified as hazardous,
toxic, radioactive or dangerous, or otherwise regulated, whether by type or by
substance as a component; "Loan Property" means any property owned by the Bank
or in which the Bank holds a security interest, and, where required by the
context, includes the owner or operator of such property, but only with respect
to such property; "Hazardous Material" means any pollutant, contaminant, or
hazardous substance within the meaning of the Comprehensive Environmental
Response, Compensation, and Liability Act, 42 U.S.C. ss. 9601 et seq., or any
similar federal, state or local law; and "Participation Facility" means any
facility in which the Bank participates in the management and, where required
by the context, includes the owner or operator of such facility, but only with
respect to such facility.

                  "Material Adverse Effect," with respect to any party, shall
mean any event, change or occurrence which, together with any other event,
change or occurrence, has a material adverse impact on (i) the financial
position, business or results of operations of such party and its subsidiaries,
taken as a whole, or (ii) the ability of such party to perform its obligations
under this Agreement or to consummate the Merger and the other transactions
contemplated by this Agreement.

         Section 12.3      Notices. All notices or other communications which 
are required or permitted hereunder shall be in writing and sufficient if
delivered personally or sent by first class or registered or certified mail,
postage prepaid, telegram or telex or other facsimile transmission addressed as
follows:

                  If to the Bank:

                           First American Bank of Indian River County
                           4000 20th Street
                           Vero Beach, Florida 32960-2495
                           Attention:    Robert J. MacWilliam
                                         President and Chief Executive Officer
                           Fax:  (561) 567-0557

                  With a copy to:

                           Smith, Mackinnon, Greeley, Bowdoin & Edwards, P.A.
                           255 South Orange Avenue, Suite 800
                           Orlando, Florida 32801
                           Attention:    John P. Greeley, Esquire
                           Fax:  (407) 843-2448

                  If to ST-Bank or SouthTrust, then to:

                           SouthTrust Corporation
                           420 North 20th Street
                           Birmingham, Alabama 35203
                           Attention:  John D. Buchanan, Esquire
                           Fax (205) 254-6697

                  with a copy to:

                           Bradley Arant Rose & White LLP
                           2001 Park Place, Suite 1400
                           Birmingham, Alabama 35203
                           Attention:  C. Larimore Whitaker, Esquire
                           Fax (205) 521-8800


                                      A-30
<PAGE>   168

         All such notices or other communications shall be deemed to have been
delivered (i) upon receipt when delivery is made by hand, (ii) on the third
(3rd) business day after deposit in the United States mail when delivery is
made by first class, registered or certified mail, and (iii) upon transmission
when made by telegram, telex or other facsimile transmission if evidenced by a
sender transmission completed confirmation.

         Section 12.4      Severability. If any term, provision, covenant or
restriction contained in this Agreement is held by a court of competent
jurisdiction or other competent authority to be invalid, void or unenforceable
or against public or regulatory policy, the remainder of the terms, provisions,
covenants and restrictions contained in this Agreement shall remain in full
force and effect and in no way shall be affected, impaired or invalidated, if,
but only if, pursuant to such remaining terms, provisions, covenants and
restrictions the Merger may be consummated in substantially the same manner as
set forth in this Agreement as of the later of the date this Agreement was
executed or last amended.

         Section 12.5      Costs and Expenses. Expenses incurred by the Bank on 
the one hand and SouthTrust on the other hand, in connection with or related to
the authorization, preparation and execution of this Agreement, the
solicitation of shareholder approval and all other matters related to the
closing of the transactions contemplated hereby, including all fees and
expenses of agents, representatives, counsel and accountants employed by either
such party or its affiliates, shall be borne solely and entirely by the party
which has incurred same.

         Section 12.6      Captions. The captions as to contents of particular
articles, sections or paragraphs contained in this Agreement and the table of
contents hereto are inserted only for convenience and are in no way to be
construed as part of this Agreement or as a limitation on the scope of the
particular articles, sections or paragraphs to which they refer.

         Section 12.7      Counterparts. This Agreement may be executed in any
number of counterparts, each of which shall be deemed an original, but all of
which together shall constitute one and the same document with the same force
and effect as though all parties had executed the same document.

         Section 12.8      Governing Law. This Agreement is made and shall be
governed by and construed in accordance with the laws of the State of Alabama
without respect to its conflicts of laws principles.

         Section 12.9      Persons Bound; No Assignment. This Agreement shall be
binding upon and shall inure to the benefit of the parties hereto and their
respective successors, distributees, and assigns, but notwithstanding the
foregoing, this Agreement may not be assigned by any party hereto unless the
prior written consent of the other parties is first obtained (other than by
ST-Bank to another affiliate of SouthTrust).

         Section 12.10     Exhibits and Schedules. Each of the exhibits and
schedules attached hereto is an integral part of this Agreement and shall be
applicable as if set forth in full at the point in the Agreement where
reference to it is made.

         Section 12.11     Waiver. The waiver by any party of the performance of
any agreement, covenant, condition or warranty contained herein shall not
invalidate this Agreement, nor shall it be considered a waiver of any other
agreement, covenant, condition or warranty contained in this Agreement. A
waiver by any party of the time for performing any act shall not be deemed a
waiver of the time for performing any other act or an act required to be
performed at a later time. The exercise of any remedy provided by law, equity
or otherwise and the provisions in this Agreement for any remedy shall not
exclude any other remedy unless it is expressly excluded. The waiver of any
provision of this Agreement must be signed by the party or parties against whom
enforcement of the waiver is sought. This Agreement and any exhibit, memorandum
or schedule hereto or delivered in connection herewith may be amended only by a
writing signed on behalf of each party hereto.

         Section 12.12     Construction of Terms. Whenever used in this
Agreement, the singular number shall include the plural and the plural the
singular. Pronouns of one gender shall include all genders. Accounting terms
used and not otherwise defined in this Agreement have the meanings determined
by, and all calculations with respect to accounting or financial matters unless
otherwise provided for herein, shall be computed in accordance with generally
accepted accounting principles, consistently applied. References herein to
articles, sections, paragraphs, subparagraphs or the like shall refer to the
corresponding articles, sections, paragraphs, subparagraphs or the like of this
Agreement. The words "hereof," "herein," and terms of similar import shall
refer to this entire Agreement. Unless the context clearly requires otherwise,
the use of the terms "including," "included," "such as," or terms of similar
meaning, shall not be construed to imply the exclusion of any other particular
elements.


                                      A-31
<PAGE>   169
         IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed and delivered, and their respective seals hereunto affixed, by their
officers thereunto duly authorized, and have caused this Agreement to be dated
as of the date and year first above written.



                                                   FIRST AMERICAN BANK
                                                 OF INDIAN RIVER COUNTY


                                      By:       /S/ ROBERT J. MACWILLIAM
                                          -------------------------------------
ATTEST                                                Its President

      /S/ STEVEN SHACKLEY
- -----------------------------------
      Its Vice President/Cashier


[CORPORATE SEAL]

                                                    SOUTHTRUST BANK,
                                                  NATIONAL ASSOCIATION


                                      By:          /S/ ALTON E. YOTHER
                                          -------------------------------------
ATTEST:                                            Its Senior Vice President

      /S/ WILLIAM L. PRATER
- -----------------------------------
          Its Secretary


[CORPORATE SEAL]

                                                 SOUTHTRUST CORPORATION


                                      By:          /S/ ALTON E. YOTHER
                                          -------------------------------------
ATTEST:                                            Its Senior Vice President

      /S/ WILLIAM L. PRATER
- -----------------------------------
          Its Secretary

[CORPORATE SEAL]


                                      A-32
<PAGE>   170


                          AGREEMENT AND PLAN OR MERGER
                    OF SOUTHTRUST BANK, NATIONAL ASSOCIATION
                            WITH FIRST AMERICAN BANK
                             OF INDIAN RIVER COUNTY

                                LIST OF SCHEDULES


Disclosure Schedule 3.2 
Disclosure Schedule 3.4 
Disclosure Schedule 3.5
Disclosure Schedule 3.7 
Disclosure Schedule 3.9 
Disclosure Schedule 3.10
Disclosure Schedule 3.11 
Disclosure Schedule 3.12(a) 
Disclosure Schedule 3.12(g)
Disclosure Schedule 3.13(a) 
Disclosure Schedule 3.13(b) 
Disclosure Schedule 3.14(a) 
Disclosure Schedule 3.14(b) 
Disclosure Schedule 3.16 
Disclosure Schedule 3.20 
Disclosure Schedule 3.22 
Disclosure Schedule 3.23 
Disclosure Schedule 3.24
Disclosure Schedule 3.25 
Disclosure Schedule 3.30 
Disclosure Schedule 4.4
Disclosure Schedule 4.7 
Disclosure Schedule 5.1(b)


                                      A-33
<PAGE>   171


                                 AMENDMENT NO. 1
                                       TO
                          AGREEMENT AND PLAN OF MERGER


                  This Amendment No. 1 (the "Amendment No. 1") is made this 14th
day of September, 1998, by and among First American Bank of Indian River County,
a Florida banking corporation (the "Bank"), SouthTrust Bank, National
Association, a national banking association ("ST-Bank"), SouthTrust of Alabama,
Inc., an Alabama corporation and wholly-owned subsidiary of SouthTrust (as
defined herein) ("ST-Sub"), and SouthTrust Corporation, a Delaware corporation
("SouthTrust").

                  WHEREAS, effective July 1, 1998, the Bank, ST-Bank and
SouthTrust executed an Agreement and Plan of Merger (the "Merger Agreement"),
pursuant to which ST-Sub will acquire the assets and business of the Bank in
exchange for shares of common stock of SouthTrust, in a transaction that
qualifies as a reorganization pursuant to Section 368(a)(1)(C) of the Internal
Revenue Code of 1986 (the "Code");

                  WHEREAS, SouthTrust desires to add its wholly-owned
subsidiary, ST-Sub as a party to the Merger Agreement;

                  WHEREAS, the Bank, ST-Bank, ST-Sub and SouthTrust wish to
amend the Merger Agreement, as set forth herein;

                  NOW, THEREFORE, in consideration of the premises and the
mutual covenants, representations, warranties and agreements herein contained,
and for other good and valuable consideration, the receipt and sufficiency of
which are hereby acknowledged, the parties hereto agree as follows:

                  1. Amendment to Parties. The Merger Agreement is hereby
amended by deleting the first sentence of page 1 and inserting in its place and
stead the following:

                  This AGREEMENT AND PLAN OF MERGER, dated as of July 1, 1998
                  (this "Agreement"), made between SouthTrust Bank, National
                  Association ("ST- Bank"), a banking association organized
                  under the laws of the United States, being located at
                  Birmingham, county of Jefferson, in the state of Alabama, with
                  a capital of $2,439,250,000, divided into 1,020,000 shares of
                  common stock, each of $8.83 par value, surplus of
                  $1,177,698,000, and undivided profits, including capital
                  reserves, of $1,245,646,000, and net unrealized gains and
                  losses on securities available for sale of $6,900,000, as of
                  June 30, 1998, and First American Bank of Indian River County,
                  a Florida banking corporation (the "Bank"), being located at
                  Vero Beach, county of Indian River, in the state of Florida,
                  with a capital of $4,845,000, divided into 128,865 shares of
                  common stock, each of $10.00 par value, surplus of $1,241,000,
                  and undivided profits, including capital reserves, of
                  $2,310,000, and net unrealized gains and losses on securities
                  available for sale of $6,000, as of June 30, 1998, and joined
                  in by SouthTrust Corporation, a Delaware corporation
                  ("SouthTrust"), and SouthTrust of Alabama, Inc., an Alabama
                  corporation ("ST-Sub"), each acting pursuant to a resolution
                  of its board of directors, adopted by the vote of a majority
                  of the directors, pursuant to the authority given by and in
                  accordance with the provisions of the Act of November 7, 1918,
                  as amended (12 U.S.C. 215a),"

                  2. Amendment to Recitals. The Merger Agreement is hereby
amended by deleting the recitals appearing on page 1 and inserting in their
place and stead the following:

                  "WHEREAS, ST-Sub wishes to acquire the assets and business of
                  the Bank in exchange for stock of SouthTrust, the parent
                  corporation of ST-Sub, in a transaction that qualifies as a
                  reorganization pursuant to Section 368(a)(1)(C) of the
                  Internal Revenue Code of 1986 (the "Code");


                                      A-34
<PAGE>   172


                  "WHEREAS, ST-Sub desires to effect such acquisition through
                  its wholly-owned subsidiary, ST-Bank, by causing the Bank to
                  be merged with and into ST-Bank;

                  "WHEREAS, ST-Sub has directed, adopted and approved the
                  acquisition of the assets and business of the Bank by merger
                  through ST-Bank, the wholly-owned subsidiary of ST-Sub;

                  "WHEREAS, the respective Boards of Directors of ST-Bank and
                  the Bank deem it in the best interests of ST-Bank and of the
                  Bank, respectively, and of their respective shareholders, that
                  ST-Bank and the Bank merge pursuant to the Merger Agreement as
                  amended by Amendment No. 1 (the "Merger");

                  "WHEREAS, the Boards of Directors of ST-Bank and the Bank have
                  approved this Agreement and have directed that this Agreement
                  be submitted to their respective shareholders for approval and
                  adoption in accordance with the laws of the State of Florida
                  and the United States; and

                  "WHEREAS, ST-Sub owns all of the issued and outstanding
                  capital stock of ST-Bank;

                  "WHEREAS, SouthTrust will contribute to ST-Sub, and ST-Sub, on
                  behalf of and as the sole shareholder of ST-Bank, will
                  deliver, or cause to be delivered, to the shareholders of the
                  Bank the consideration to be paid pursuant to the Merger in
                  accordance with the terms of this Agreement;

                  "WHEREAS, SouthTrust, on behalf of and as sole shareholder of
                  ST-Sub will cause ST-Sub to perform its obligations provided
                  for hereunder and otherwise take or cause to be taken the
                  various other actions provided for herein to facilitate the
                  administration of the transactions provided for herein in
                  accordance with the terms and provisions hereof;

                  "NOW THEREFORE, in consideration of the premises and mutual
                  covenants, representations, warranties and agreements herein
                  contained, the parties agree that the Bank will be merged with
                  and into ST-Bank and that the terms and conditions of the
                  Merger, the mode of carrying the Merger into effect, including
                  the manner of converting the shares of common stock of the
                  Bank into shares of common stock of SouthTrust shall be as
                  hereinafter set forth."

                  3. Amendment to Article I. The Merger Agreement is hereby
amended as follows:

                           a.               By numbering the first paragraph of
Section 1.1 as (a) and inserting "or such other time as the parties may agree"
at the end of the last sentence of said paragraph.

                           b.               By deleting "each of the Office of 
the Comptroller Department of Banking and Finance of the State of Florida (the
"Department") and" from the second sentence of the first paragraph of Section
1.1.

                           c.               By renumbering the second paragraph
of Section 1.1 as (b).

                           d.               By inserting the following after the
second paragraph of Section 1.1:

                  "(c) The main office of the Bank is located at 4000 20th
                  Street, Vero Beach, Florida 32960. The main office of ST-Bank
                  is located at Birmingham, Alabama.


                                      A-35
<PAGE>   173


                  "(d) The business of the Surviving Corporation shall be that
                  of a national banking association. The proposed main office of
                  the Surviving Corporation shall be located at Birmingham,
                  Alabama. The branch offices of the Surviving Corporation shall
                  be the existing branch offices of ST-Bank and the existing
                  main and branch offices of the Bank.

                  "(e) As of June 30, 1998, ST-Bank had total capital of
                  $2,439,250,000 divided into 1,020,000 shares of ST-Bank Common
                  Stock, and surplus and undivided profits and net unrealized
                  holding gains (losses) on available for sale securities of
                  $2,430,244,000. As of June 30, 1998, the Bank had total
                  capital of $4,845,000 divided into 213,000 shares of
                  authorized Common Stock, par value $10.00, of which 128,865
                  are issued and outstanding and of which none are held as
                  treasury stock, and surplus and undivided profits and net
                  unrealized holding gains (losses) on available for sale
                  securities of $3,557,000.

                  "(f) The amount of capital stock of the Surviving Corporation
                  shall be $9,006,600, divided into 1,020,000 shares of common
                  stock, each of $8.83 par value, and at the Effective Time of
                  the Merger, the Surviving Corporation shall have a surplus of
                  $1,182,537,000, and undivided profits, including capital
                  reserves, which when combined with the capital and surplus
                  will be equal to the combined capital structures of ST-Bank
                  and the Bank as stated in the preamble of this Agreement,
                  adjusted however, for normal earnings and expenses between
                  June 30, 1998, and the Effective Time of the Merger.

                  "(g) The Surviving Corporation shall have trust powers.

                  "(h) The Articles of Association under which the Surviving
                  Corporation will operate shall be the Articles of Association
                  of ST-Bank."

                           e.               By deleting "all the duties and 
liabilities of a corporation organized under the laws of its state of
incorporation" from the third sentence of Section 1.2 and inserting in its place
and stead "all the duties and liabilities of a national banking association
organized under the laws of the United States."

                           f.               By numbering the first paragraph of
Section 1.2 as (a) and inserting the following as paragraph (b) to Section 1.2:

                  "The shares of ST-Bank Common Stock issued and outstanding
                  immediately prior to the Effective Time of the Merger shall
                  remain outstanding and unchanged after the Merger and shall
                  thereafter constitute all of the issued and outstanding shares
                  of capital stock of the Surviving Corporation. The Bank Shares
                  (as hereinafter defined) shall be treated in the Merger as
                  specified in Article II."


                  4. Amendment to Article II. The Merger Agreement is hereby
amended as follows: (a) by deleting "SouthTrust, the Bank, or ST-Bank" from the
first sentence of Section 2.1 therein and inserting in its place and stead
"SouthTrust, ST-Sub, ST-Bank or the Bank," and (b) by deleting "SouthTrust,
ST-Bank" from Section 2.5 therein and inserting in its place and stead
"SouthTrust, ST-Sub, ST-Bank."

                  5. Amendment to Article III. The Merger Agreement is hereby
amended by deleting "ST- Bank and SouthTrust" from the first sentence of Article
III therein and inserting in its place and stead "ST-Bank, ST-Sub and
SouthTrust."

                  6. Amendments to Article IV. The Merger Agreement is hereby
amended as follows:

                           a.               By deleting "SouthTrust and ST-Bank"
from the caption and the first sentence of Article IV and inserting in its place
and stead "SouthTrust, ST-Sub and ST-Bank."


                                      A-36
<PAGE>   174


                           b. By inserting the following after Section 4.1:

                  "Section 4.1A. Organization and Related Matters of ST-Sub.
                  "(a) ST-Sub is, or as of the Effective Time of the Merger,
                  will be, a corporation duly organized, validly existing and in
                  good standing under the laws of the state of incorporation.
                  ST-Sub has, or as of the Effective Time of the Merger, will
                  have, the corporate power and authority to own or lease all of
                  its properties and assets and to carry on its business as now
                  conducted, or as proposed to be conducted pursuant to this
                  Agreement, and ST-Sub is, or as of the Effective Time of the
                  Merger will be, licensed or qualified to do business in each
                  jurisdiction in which the nature of the business conducted or
                  to be conducted by ST-Sub, or the character or location of the
                  properties and assets owned or leased, or to be owned or
                  leased, by ST-Sub makes such licensing or qualification
                  necessary, except where the failure to be so licensed or
                  qualified (or steps necessary to cure such failure) would not
                  have a Material Adverse Effect on SouthTrust. True and correct
                  copies of the Articles of Incorporation of ST-Sub and the
                  Bylaws of ST-Sub, each as amended to the date hereof, will be
                  made available to the Bank. "(b) ST-Sub has, or as of the
                  Effective Time of the Merger, will have, in effect all
                  federal, state, local and foreign governmental, regulatory and
                  other authorizations, permits and licenses necessary for it to
                  own or lease its properties and assets and to carry on its
                  business as proposed to be conducted, the absence of which,
                  either individually or in the aggregate, would have a Material
                  Adverse Effect on SouthTrust."

                           c.               By deleting "SouthTrust and ST-Bank"
and "SouthTrust or ST-Bank" each time they appear in Section 4.4 and inserting
in their place and stead "SouthTrust, ST-Sub and ST-Bank" and "SouthTrust,
ST-Sub or ST-Bank," respectively.

                           d.               By deleting clause (i) in its 
entirety from Section 4.4 and inserting in its place and stead "(i) violate any
provision of the Restated Certificate of Incorporation or Bylaws of SouthTrust,
or the Articles or Certificate of Incorporation or Bylaws of ST-Sub or the
Articles of Association or Bylaws of ST- Bank."

                           e.               By deleting "SouthTrust nor ST-Bank"
from Section 4.12 and inserting in its place and stead "SouthTrust, ST-Sub nor
ST-Bank."

                           f.               By deleting "SouthTrust or ST-Bank"
from Section 4.13 and inserting in its place and stead "SouthTrust, ST-Sub or
ST-Bank."

                  7. Amendment to Section 6.7. The Merger Agreement is hereby
amended by inserting ", on behalf of ST-Sub," after the first word of Section
6.7 therein.

                  8. Amendment to Article VII. The Merger Agreement is hereby
amended by inserting ", ST-Sub" in the first sentence of Article VII immediately
after the word "SouthTrust."

                  9. Amendment to Article VIII. The Merger Agreement is hereby
amended by deleting "SouthTrust and ST-Bank" from the caption and first sentence
of Article VIII and from Section 8.3 and inserting in its place and stead
"SouthTrust, ST-Sub and ST-Bank."

                  10. Amendments to Article IX. The Merger Agreement is hereby
amended by deleting "SouthTrust and ST-Bank" from Sections 9.1, 9.2, 9.3 and 9.5
and inserting in its place and stead "SouthTrust, ST- Sub and ST-Bank."

                  11. Amendments to Article X. The Merger Agreement is hereby
amended as follows:

                           a.               By inserting ", ST-Sub, ST-Bank" in
Section 10.1(a) and 10.1(b) immediately after the word "SouthTrust."


                                      A-37
<PAGE>   175


                           b.               By deleting "SouthTrust or ST-Bank"
each time it appears in Section 10.1(e) and inserting in its place and stead
"SouthTrust, ST-Sub or ST-Bank."

                           c.               By deleting "SouthTrust, ST-Bank,"
"SouthTrust and ST-Bank" and "SouthTrust or ST-Bank" from Sections 10.3, 10.4
and 10.5 each time such phrases appear and inserting in their place and stead
"SouthTrust, ST-Sub, ST-Bank," "SouthTrust, ST-Sub and ST-Bank" and "SouthTrust,
ST-Sub or ST-Bank," respectively.

                  12. Amendment to Article XI. The Merger Agreement is hereby
amended as follows:

                           a.               By inserting "ST-Sub," after the 
word "SouthTrust" in the first sentence of Section 11.1.

                           b.               By inserting ", ST-Sub" in Section 
11.3 immediately after the words "If to ST-Bank."

                  13. Capitalized terms not defined herein shall have the
meanings assigned to them in the Merger Agreement.

                  14. Except as expressly amended herein, all other terms and
conditions of the Merger Agreement shall remain in full force and effect.


         IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed and delivered, and their respective seals hereunto affixed, by their
officers thereunto duly authorized, and have caused this Agreement to be dated
as of the date and year first above written.

                                                FIRST AMERICAN BANK
                                              OF INDIAN RIVER COUNTY


                                   By:       /S/ ROBERT J. MACWILLIAM
                                      -----------------------------------------
ATTEST:                                      Its Chief Executive Officer

    /S/ STEVE C. SHACKLEY
- -------------------------------
    Its Vice President/Cashier


[CORPORATE SEAL]

                                                     SOUTHTRUST BANK,
                                                   NATIONAL ASSOCIATION


                                   By:       /S/ PAUL GOURLEY, JR.
                                       ----------------------------------------
ATTEST:                                      Its Senior Vice President

    /S/ WILLIAM L. PRATER
- -------------------------------
    Its Assistant Secretary

[CORPORATE SEAL]


                                      A-38
<PAGE>   176


                                          SOUTHTRUST CORPORATION


                                   By:       /S/ PAUL GOURLEY, JR.
                                       ----------------------------------------
ATTEST:                                      Its Senior Vice President

    /S/ WILLIAM L. PRATER
- -------------------------------
    Its Assistant Secretary

[CORPORATE SEAL]


                                          SOUTHTRUST OF ALABAMA, INC.



                                   By:       /S/ PAUL GOURLEY, JR.
                                       ----------------------------------------
ATTEST:                                       Its Vice President

    /S/ WILLIAM L. PRATER
- -------------------------------
    Its Assistant Secretary

[CORPORATE SEAL]


                                      A-39
<PAGE>   177

                                                                      EXHIBIT B

                           [FORM OF FAIRNESS OPINION]




_________, 1998


Board of Directors
First American Bank of Indian River County
4000 20th Street
Vero Beach, Florida  32960-2495

Gentlemen:

You have requested our opinion as to the fairness, from a financial point of
view, to the shareholders of First American Bank of Indian River County
("Bank") of Vero Beach, Florida, of the consideration to be paid to the
shareholders of the Bank in the form of a tax-free exchange of shares by
SouthTrust of Alabama, Inc. ("ST-Sub"), on behalf of SouthTrust Bank, National
Association ("ST-Bank") of Birmingham, Alabama, as provided by the Agreement
and Plan of Merger entered into by the parties on July 1, 1998, as subsequently
amended ("Merger Agreement"). Pursuant to the Merger Agreement, ST-Sub will
acquire all of the outstanding shares of the Bank by exchanging shares of
SouthTrust Common Stock for the shares of the Bank. Outstanding options of the
Bank will be assumed by ST-Bank. The Bank will be merged with and into ST-Bank
and the Bank will cease to exist.

In performing our analysis of the proposed merger, we have among other things:

1.   Reviewed the statements audited by Rex Meighen & Company of
     Tampa, Florida, for the fiscal years ended 12/31/97, and KPMG Peat
     Marwick, LLP of Vero Beach, Florida, for the fiscal years ended 12/31/96,
     and 12/31/95.

2.   Reviewed the Call Reports of the Bank filed with the regulators reflecting
     the operations of the Bank for the periods ended 3/31/98, 12/31/97,
     12/31/96, and 12/31/95.

3.   Reviewed the Agreement and Plan of Merger dated July 1, 1998, as amended.

4.   Compared the terms of the Agreement and Plan of Merger with ST-Bank with
     the terms offered shareholders of comparable institutions in Florida in
     recent transactions.

5.   Reviewed the budget for the Bank for the year 1998.

6.   Reviewed the three-year financial plan for the Bank.

7.   Reviewed other financial information concerning the Bank.

8.   Examined the Bank's market share in the Indian River County market.

9.   Reviewed the financial information concerning the operations of SouthTrust
     Corporation.


                                      B-1
<PAGE>   178

Board of Directors
Page Two
_____________, 1998



10.  Reviewed the financial condition of SouthTrust Corporation and the impact
     of the proposed transaction on the market price of the shares of
     SouthTrust Corporation Common Stock.

11.  Reviewed the price performance and trading activity in the shares of
     SouthTrust Common Stock over the past six months.

12.  Reviewed the Board of Directors' marketing plan which was utilized in
     contacting qualified bank holding companies interested in acquiring the
     Bank.

In arriving at our opinion, we have relied upon the accuracy and completeness
of the information provided to us by the Bank which we have used in the
accompanying analysis. We have not conducted an independent verification of
such information or performed an independent appraisal of the Bank's assets and
liabilities.

On June 30, 1998, Ewing delivered to the Board of Directors of the Bank its
preliminary oral opinion as to the fairness, from a financial point of view, of
the terms offered by SouthTrust, subject to Ewing's review of the final Merger
Agreement.

Based upon the accompanying analysis and our knowledge of and experience in the
valuation of Florida banks and their securities, it is our opinion that the
consideration to be paid by SouthTrust of Alabama, Inc., on behalf of
SouthTrust Bank, National Association for the common shares of First American
Bank of Indian River County is fair, from a financial point of view, to the
shareholders of the Bank.

The opinion of Allen C. Ewing & Co. ("Ewing") is directed to the Board of
Directors and does not constitute a recommendation to any shareholder as to how
such shareholder should vote at the shareholders' meeting held in connection
with the proposed transaction. Ewing has not been requested to opine as to, and
the opinion does not address, the Board's underlying business decision to
support and recommend the acquisition to the shareholders.


Very truly yours,
ALLEN C. EWING & CO.



By:
   --------------------------------
     Benjamin C. Bishop, Jr.


                                      B-2



<PAGE>   179
                                                                      EXHIBIT C
                                 NATIONAL BANKS
                            CONSOLIDATION AND MERGER

Title 12 United States Code

SS. 215A.  MERGER OF NATIONAL BANKS OR STATE BANKS INTO NATIONAL BANKS.


         (b)      Dissenting shareholders

         If a merger shall be voted for at the called meetings by the necessary
majorities of the shareholders of each association or State bank participating
in the plan of merger, and thereafter the merger shall be approved by the
Comptroller, any shareholder of any association or State bank to be merged into
the receiving association who has voted against such merger at the meeting of
the association or bank of which he is a stockholder, or has given notice in
writing at or prior to such meeting to the presiding officer that he dissents
from the plan of merger, shall be entitled to receive the value of the shares so
held by him when such merger shall be approved by the Comptroller upon written
request made to the receiving association at any time before thirty days after
the date of consummation of the merger, accompanied by the surrender of his
stock certificates.

         (c)      Valuation of shares

         The value of the shares of any dissenting shareholder shall be
ascertained, as of the effective date of the merger, by an appraisal made by a
committee of three persons, composed of (1) one selected by the vote of the
holders of the majority of the stock, the owners of which are entitled to
payment in cash; (2) one selected by the directors of the receiving association;
and (3) one selected by the two so selected. The valuation agreed upon by any
two of the three appraisers shall govern. If the value so fixed shall not be
satisfactory to any dissenting shareholder who has requested payment, that
shareholder may, within five days after being notified of the appraised value of
his shares, appeal to the Comptroller, who shall cause a reappraisal to be made
which shall be final and binding as to the value of the shares of the appellant.

         (d)      Application to shareholders of merging associations; appraisal
                  by Comptroller; expenses of receiving association; sale and
                  resale of shares; State appraisal and merger law

         If, within ninety days from the date of consummation of the merger, for
any reason one or more of the appraisers is not selected as herein provided, or
the appraisers fail to determine the value of such shares, the Comptroller shall
upon written request of any interested party cause an appraisal to be made which
shall be final and binding on all parties. The expenses of the Comptroller in
making the reappraisal or the appraisal, as the case may be, shall be paid by
the receiving association. The value of the shares ascertained shall be promptly
paid to the dissenting shareholders by the receiving association. The shares of
stock of the receiving association which would have been delivered to such
dissenting shareholders had they not requested payment shall be sold by the
receiving association at an advertised public auction, and the receiving
association shall have the right to purchase any of such shares at such public
auction, if it is the highest bidder therefor, for the purpose of reselling such
shares within thirty days thereafter to such person or persons and at such price
not less than par as its board of directors by resolution may determine. If the
shares are sold at public auction at a price greater than the amount paid to the
dissenting shareholders, the excess in such sale price shall be paid to such
dissenting shareholders. The appraisal of such shares of stock in any State bank
shall be determined in the manner prescribed by the law of the State in such
cases, rather than as provided in this section, if such provision is made in the
State law; and no such merger shall be in contravention of the law of the State
under which such bank is incorporated. The provisions of this subsection shall
apply only to shareholders of (and stock owned by them in) a bank or association
being merged into the receiving association.


                                       C-1
<PAGE>   180
                                    PART II

                     INFORMATION NOT REQUIRED IN PROSPECTUS

         ITEM 20.  INDEMNIFICATION OF DIRECTORS AND OFFICERS.

         The Restated Certificate of Incorporation and the Bylaws of Registrant
         provide that Registrant shall indemnify its officers, directors,
         employees and agents to the extent permitted by the General
         Corporation Law of the State of Delaware, which permits a corporation
         to indemnify any person who was or is a party or is threatened to be
         made a party to any threatened, pending or completed action, suit or
         proceeding by reason of the fact that he is or was a director,
         officer, employee or agent of the corporation, against expenses
         (including attorney's fees), judgments, fines and settlements incurred
         by him in connection with any such suit or proceeding, if he acted in
         good faith and in a manner reasonably believed to be in or not opposed
         to the best interests of the corporation, and, in the case of a
         derivative action on behalf of the corporation, if he were not
         adjudged to be liable for negligence or misconduct.

         ITEM 21.  EXHIBITS AND FINANCIAL STATEMENT SCHEDULES.

         The following exhibits are filed as part of this Registration 
         Statement:

<TABLE>
<S>     <C>        <C>
        2          Agreement and Plan of Merger and Amendment No. 1 to Agreement and Plan of Merger by 
                   and among First American Bank of Indian River County and SouthTrust Bank, National
                   Association, and joined in by SouthTrust Corporation and SouthTrust of Alabama, Inc.
                   (included as Exhibit A to the Proxy Statement/Prospectus filed as part of this Registration
                   Statement).
*       3(a)       Composite Restated Bylaws of SouthTrust Corporation.
*       3(b)       Composite Restated Certificate of Incorporation of SouthTrust Corporation.
*       4(a)       Certificate of Adoption of Resolutions designating Series A Junior Participating Preferred 
                   Stock, adopted February 22, 1989, which was filed as Exhibit 1 to SouthTrust Corporation's
                   Registration Statement on Form 8-A (File No. 1-3613).
*       4(b)       Stockholders' Rights Agreement, dated as of February 22, 1989, between SouthTrust 
                   Corporation and Mellon Bank, N.A., Rights Agent, which was filed as Exhibit 1 to SouthTrust 
                   Corporation's Registration Statement on Form 8-A (File No. 1-3613).
*       4(c)       Indenture, dated as of May 1, 1987 between SouthTrust Corporation and National 
                   Westminster Bank USA, which was filed as Exhibit 4(a) to SouthTrust Corporation's 
                   Registration Statement on Form S-3 (Registration No. 33-13637).
*       4(d)       Subordinated Indenture, dated as of May 1, 1992, between SouthTrust Corporation and 
                   Chemical Bank, which was filed as Exhibit 4(1)(ii) to the Registration Statement on Form S-3 
                   of SouthTrust Corporation (Registration No. 33-44857).
        5          Opinion of Bradley Arant Rose & White LLP as to the legality of the securities being registered.
        8          Form of Opinion of Bradley Arant Rose & White LLP regarding certain tax matters.
        23(a)      Consent of Arthur Andersen LLP (with respect to SouthTrust Corporation).
        23(b)      Consent of Rex Meighen & Company (with respect to First American Bank of Indian River County).
        23(c)      Consent of KPMG Peat Marwick LLP (with respect to First American Bank of Indian River County).
        23(d)      Consent of Bradley Arant Rose & White LLP (included in Exhibit 5).
        23(e)      Consent of Allen C. Ewing & Co.
        24         Powers of Attorney.
        99         Form of Proxy
</TABLE>


- -------------------
*   Incorporated by reference.



                                      II-1
<PAGE>   181


         ITEM 22. UNDERTAKINGS.

            (a)   The undersigned registrant hereby undertakes:

                  (1)      To file, during any period in which offers or sales 
                           are being made, a post-effective amendment to this
                           Registration Statement.

                           (i)      To include any prospectus required by 
                                    Section 10(a)(3) of the Securities Act of
                                    1933;

                           (ii)     To reflect in the prospectus any facts or
                                    events arising after the effective date of
                                    the Registration Statement (or the most
                                    recent post-effective amendment thereof)
                                    which, individually or in the aggregate,
                                    represent a fundamental change in the
                                    information set forth in the Registration
                                    Statement. Notwithstanding the foregoing,
                                    any increase or decrease in volume of
                                    securities offered (if the total dollar
                                    value of securities offered would not
                                    exceed that which was registered) and any
                                    deviation from the low or high end of the
                                    estimated maximum offering range may be
                                    reflected in the form of prospectus filed
                                    with the Commission pursuant to Rule 424(b)
                                    if, in the aggregate, the changes in volume
                                    and price represent no more than a 20
                                    percent change in the maximum aggregate
                                    offering price set forth in the
                                    "Calculation of Registration Fee" table in
                                    the effective Registration Statement;

                           (iii)    To include any material information with
                                    respect to the plan of distribution not
                                    previously disclosed in the Registration
                                    Statement or any material change to such
                                    information in the Registration Statement;

         provided, however, that paragraphs (a)(1)(i) and (a)(1)(ii) do not
         apply if the Registration Statement is on Form S-3, Form S-8 or Form
         F-3, and the information required to be included in a post-effective
         amendment by those paragraphs is contained in periodic reports filed
         with or furnished to the Commission by the registrant pursuant to
         Section 13 or 15(d) of the Exchange Act that are incorporated by
         reference in the Registration Statement.

                  (2)      That, for the purpose of determining any liability 
                           under the Securities Act of 1933, each such
                           post-effective amendment shall be deemed to be a new
                           Registration Statement relating to the securities
                           offered therein, and the offering of such securities
                           at that time shall be deemed to be the initial bona
                           fide offering thereof;

                  (3)      To remove from registration by means of a 
                           post-effective amendment any of the securities being
                           registered which remain unsold at the termination of
                           the offering.

            (b)   The undersigned Registrant hereby undertakes that, for 
                  purposes of determining any liability under the Securities
                  Act of 1933, each filing of the Registrant's annual report
                  pursuant to Section 13(a) or 15(d) of the Securities Exchange
                  Act of 1934 (and, where applicable, each filing of an
                  employee benefit plan's annual report pursuant to Section
                  15(d) of the Securities Exchange Act of 1934) that is
                  incorporated by reference in the Registration Statement shall
                  be deemed to be a new registration statement relating to the
                  securities offered therein, and the offering of such
                  securities at that time shall be deemed to be the initial
                  bona fide offering thereof.

            (c)   (1)      The undersigned registrant hereby undertakes as 
                           follows: that prior to any public reoffering of the
                           securities registered hereunder through use of a
                           prospectus which is a part of this Registration
                           Statement, by any person or party who is deemed to
                           be an 



                                     II-2
<PAGE>   182

                           underwriter within the meaning of Rule 145(c), the
                           issuer undertakes that such reoffering prospectus
                           will contain the information called for by the
                           applicable registration form with respect to
                           reofferings by persons who may be deemed
                           underwriters, in addition to the information called
                           for by the other items of the applicable form.

                  (2)      The registrant undertakes that every prospectus:  
                           (i) that is filed pursuant to paragraph (1)
                           immediately preceding, or (ii) that purports to meet
                           the requirements of Section 10(a)(3) of the Act and
                           is used in connection with an offering of securities
                           subject to Rule 415, will be filed as a part of an
                           amendment to the Registration Statement and will not
                           be used until such amendment is effective, and that,
                           for purposes of determining any liability under the
                           Securities Act of 1933, each such post-effective
                           amendment shall be deemed to be a new Registration
                           Statement relating to the securities offered
                           therein, and the offering of such securities at that
                           time shall be deemed to be the initial bona fide
                           offering thereof.

            (d)   Insofar as indemnification for liabilities arising under the 
                  Securities Act of 1933 may be permitted to directors,
                  officers and controlling persons of the Registrant pursuant
                  to the foregoing provisions, or otherwise, the Registrant has
                  been advised that in the opinion of the Securities and
                  Exchange Commission such indemnification is against public
                  policy as expressed in the Act and is, therefore,
                  unenforceable. In the event that a claim for indemnification
                  against such liabilities (other than the payment by the
                  Registrant of expenses incurred or paid by a director,
                  officer or controlling person of the Registrant in the
                  successful defense of any action, suit or proceeding) is
                  asserted by such director, officer or controlling person in
                  connection with the securities being registered, the
                  Registrant will, unless in the opinion of its counsel the
                  matter has been settled by controlling precedent, submit to a
                  court of appropriate jurisdiction the question whether such
                  indemnification by it is against public policy as expressed
                  in the Act and will be governed by the final adjudication of
                  such issue.

            (e)   The undersigned Registrant hereby undertakes to respond to 
                  requests for information that is incorporated by reference
                  into the prospectus pursuant to Item 4, 10(b), 11, or 13 of
                  this Form, within one business day of receipt of such
                  request, and to send the incorporated documents by first
                  class mail or other equally prompt means. This includes
                  information contained in documents filed subsequent to the
                  effective date of the registration statement through the date
                  of responding to the request.

            (f)   The undersigned Registrant hereby undertakes to supply by 
                  means of a post-effective amendment all information
                  concerning a transaction, and the company being acquired
                  involved therein, that was not the subject of and included in
                  the registration statement when it became effective.



                                      II-3
<PAGE>   183



                                   SIGNATURES


               Pursuant to the requirements of the Securities Act of 1933, the
registrant has duly caused this registration statement to be signed on its
behalf by the undersigned, thereunto duly authorized, in the City of
Birmingham, State of Alabama, on November 3, 1998.


                                           SOUTHTRUST CORPORATION



                          By:            /s/ WALLACE D. MALONE, JR.     
                             --------------------------------------------------
                                      Its Chairman of the Board of
                              Directors, President and Chief Executive Officer



               Pursuant to the requirements of the Securities Act of 1933, this
registration statement has been signed below by the following persons in the
capacities and on the dates indicated.

<TABLE>
<CAPTION>

             Signature                                                     Title                                  Date
             ---------                                                     -----                                  ----


<S>                                                         <C>                                             <C>
   /s/ WALLACE D. MALONE, JR.                               Chairman, President, Chief Executive            November 3, 1998
- --------------------------------------                               Officer, Director
     Wallace D. Malone, Jr.                                    (Principal Executive Officer)
                                                               


       /s/ ALTON E. YOTHER                                       Secretary, Treasurer and                  November 3, 1998
- ---------------------------------------                            Controller (Principal
           Alton E. Yother                                            Accounting and
                                                                    Financial Officer)


      /s/ JULIAN W. BANTON                                               Director                          November 3, 1998
- ---------------------------------------                       (Chairman and Chief Executive
          Julian W. Banton                                     Officer, SouthTrust Bank, N.A.)
                                                               


                *                                                        Director                          November 3, 1998
- ---------------------------------------
      Allen J. Keesler, Jr.


                *                                                        Director                          November 3, 1998
- ---------------------------------------
         Van L. Richey


                *                                                        Director                          November 3, 1998
- ---------------------------------------
        Carl F. Bailey
</TABLE>



                                     II-4
<PAGE>   184


<TABLE>
<S>                                                           <C>                   <C>


                        
                                                              Director              
- ---------------------------------------
         Rex J. Lysinger


                *                                             Director              November 3, 1998
- ---------------------------------------
         William C. Hulsey


                *                                             Director              November 3, 1998
- ---------------------------------------
          John M. Bradford


                                                              Director              
- ---------------------------------------
     Wm. Kendrick Upchurch, Jr.


               *                                              Director              November 3, 1998
- ---------------------------------------
        H. Allen Franklin


               *                                              Director              November 3, 1998
- ---------------------------------------
        F. Crowder Falls


*By     /s/ William L. Prater                                                       November 3, 1998
   ------------------------------------
            William L. Prater
            Attorney-in-fact
</TABLE>



                                      II-5

<PAGE>   185


                               INDEX TO EXHIBITS

<TABLE>
<CAPTION>
        EXHIBIT
          NO.                                    DESCRIPTION
        -------                                  -----------

<S>     <C>             <C>
         2              Agreement and Plan of Merger and Amendment No. 1 to Agreement and Plan of 
                        Merger by and among First American Bank of Indian River County and SouthTrust
                        Bank, National Association, and joined in by SouthTrust Corporation and SouthTrust 
                        of Alabama, Inc. (included as Exhibit A to the Proxy Statement/Prospectus filed as 
                        part of this Registration Statement).
*        3(a)           Composite Restated Bylaws of SouthTrust Corporation.
*        3(b)           Composite Restated Certificate of Incorporation of SouthTrust Corporation.
*        4(a)           Certificate of Adoption of Resolutions designating Series A Junior Participating 
                        Preferred Stock, adopted February 22, 1989, which was filed as Exhibit 1 to 
                        SouthTrust Corporation's Registration Statement on Form 8-A (File No. 1-3613).
*        4(b)           Stockholders' Rights Agreement, dated as of February 22, 1989, between SouthTrust 
                        Corporation and Mellon Bank, N.A., Rights Agent, which was filed as Exhibit 1 to 
                        SouthTrust Corporation's Registration Statement on Form 8-A (File No. 1-3613).
*        4(c)           Indenture, dated as of May 1, 1987 between SouthTrust Corporation and National 
                        Westminster Bank USA, which was filed as Exhibit 4(a) to SouthTrust Corporation's 
                        Registration Statement on Form S-3 (Registration No. 33-13637).
*        4(d)           Subordinated Indenture, dated as of May 1, 1992, between SouthTrust Corporation 
                        and Chemical Bank, which was filed as Exhibit 4(1)(ii) to the Registration Statement 
                        on Form S-3 of SouthTrust Corporation (Registration No. 33-44857).
           5            Opinion of Bradley Arant Rose & White LLP as to the legality of the securities being registered.
           8            Form of Opinion of Bradley Arant Rose & White LLP regarding certain tax matters.
         23(a)          Consent of Arthur Andersen LLP (with respect to SouthTrust Corporation).
         23(b)          Consent of Rex Meighen & Company (with respect to First American Bank of Indian River County).
         23(c)          Consent of KPMG Peat Marwick LLP (with respect to First American Bank of Indian River County).
         23(d)          Consent of Bradley Arant Rose & White LLP (included in Exhibit 5).
         23(e)          Consent of Allen C. Ewing & Co.
          24            Powers of Attorney.
          99            Form of Proxy
</TABLE>


- -----------------------
*   Incorporated by reference.


<PAGE>   1
                                                                      EXHIBIT 5








                               November 2, 1998

SouthTrust Corporation
420 North 20th Street
Birmingham, Alabama  35203

Ladies and Gentlemen:

                  In our capacity as counsel for SouthTrust Corporation, a
Delaware corporation ("SouthTrust"), we have examined the Registration
Statement on Form S-4 (the "Registration Statement"), in form as proposed to be
filed by SouthTrust with the Securities and Exchange Commission under the
provisions of the Securities Act of 1933, relating to the proposed merger (the
"Merger") of First American Bank of Indian River County, a Florida banking
corporation ("First American"), with and into SouthTrust Bank, National
Association, a national banking association, and the issuance of up to 253,546
shares of common stock, par value $2.50 per share, of SouthTrust (the "Shares")
and up to 75,036 rights to purchase 1/100th of one share of Series A Junior
Participating Preferred Stock (the "Rights") in connection with the Merger.
Pursuant to the Merger, each holder of shares of common stock of First American
will receive shares of SouthTrust common stock. In this connection, we have
examined such records, documents and proceedings as we have deemed relevant and
necessary as a basis for the opinions expressed herein.

                  Upon the basis of the foregoing, we are of the opinion that
the Shares and Rights to be registered under the Registration Statement, to the
extent actually issued pursuant to the Merger, will be legally issued, fully
paid and nonassessable.

                  We hereby consent to the filing of this opinion with the
Securities and Exchange Commission as an exhibit to the Registration Statement.
In addition, we hereby consent to the inclusion of the statements made in
reference to our firm under the caption Legal Matters in the Proxy
Statement/Prospectus which is a part of the Registration Statement.

                                          Very truly yours,

                                          /s/ BRADLEY ARANT ROSE & WHITE LLP



<PAGE>   1

                                                                      EXHIBIT 8


                             __________ ____, 1998


First American Bank of Indian River County
4000 20th Street
Vero Beach, Florida 32960

         Re:      Agreement and Plan of Merger of SouthTrust Bank, National 
                  Association and First American Bank of Indian River County,
                  joined in by SouthTrust Corporation and SouthTrust of
                  Alabama, Inc.

Ladies and Gentlemen:

                  You have requested the opinion of Bradley Arant Rose & White
LLP, as counsel to SouthTrust Corporation, a Delaware corporation
("SouthTrust"), regarding the transactions contemplated by that certain
Agreement and Plan of Merger dated July 1, 1998, as amended by that Amendment
No. 1 to Agreement and Plan of Merger dated September 14, 1998 (as amended, the
"Merger Agreement"), of SouthTrust Bank, National Association (ST-Bank) and
First American Bank of Indian River County ("First American"), joined in by
SouthTrust and SouthTrust of Alabama, Inc., an Alabama corporation and a
wholly-owned subsidiary of SouthTrust ("ST-Sub"). Specifically, you have
requested us to opine that the merger of First American with and into ST-Bank
(the "Merger") pursuant to the Merger Agreement will constitute a tax-free
reorganization under Section 368(a) of the Internal Revenue Code of 1986, as
amended (the "Code"), and that no gain or loss will be recognized by the
stockholders of First American upon the receipt solely of SouthTrust voting
common stock in exchange for their First American stock upon consummation of
the Merger.

                  This opinion is being rendered pursuant to Section 9.8 of the
Merger Agreement (as modified by that Certain Side Letter dated October 20,
1998, waiving the requirement of Section 9.8 subject to the provision of this
opinion) and the requirements of Item 21(a) of the registration statement on
Form S-4 (the "Registration Statement") which is being filed on SouthTrust's
behalf with the Securities and Exchange Commission under the Securities Act of
1933, as amended. Capitalized terms used herein and not otherwise defined
herein have the meanings given to them in the Merger Agreement.

                  In rendering the opinion set forth below, we have examined
and relied upon originals or copies of the Merger Agreement, and upon
representations given to us by letter from First American of even date herewith
and from SouthTrust of even date herewith, each as described in the
representation section of this letter (the "Representation Letters"), and such
other documents and materials as we have deemed necessary as a basis for such
opinion. In connection with such examination, we have assumed the genuineness
of all signatures, the authenticity of all documents, agreements


<PAGE>   2

First American Bank
___________ ____, 1998
Page 2                           


and instruments submitted to us as originals, the conformity to original
documents, agreements and instruments of all documents, agreements and
instruments submitted to us as copies or specimens and the authenticity of the
originals of such documents, agreements and instruments submitted to us as
copies or specimens, and, as to factual matters, the veracity of written
statements made by officers and other representatives of First American and
SouthTrust included in the Merger Agreement and the Representation Letters.

                  The opinion stated below is based upon the relevant
provisions of the Code, regulations promulgated pursuant thereto by the
Department of the Treasury and the Internal Revenue Service (the "IRS"),
current administrative rulings and applicable judicial decisions, all of which
are subject to change. Neither SouthTrust, ST-Sub, ST-Bank nor First American
has requested or will receive an advance ruling from the IRS as to any of the
federal income tax effects to holders of First American stock of the Merger, or
of any of the federal income tax effects to SouthTrust, ST-Sub, ST-Bank or
First American of the Merger. Our opinion set forth below is not binding upon
the IRS, and there can be no assurance, and none hereby is given, that the IRS
will not take a position contrary to one or more of the positions reflected
herein, or that our opinion will be upheld by the courts if challenged by the
IRS.


                                     FACTS

                  SouthTrust is a registered bank holding company and is the
common parent of an affiliated group of corporations, including ST-Bank, that
file consolidated federal income tax returns on the calendar year basis.
SouthTrust Common Stock is publicly held and publicly traded through the
Automated Quotation System of the Nasdaq Stock Market.

                  In accordance with resolutions of SouthTrust's Board of
Directors adopted on February 22, 1989, each share of SouthTrust Common Stock
issued and outstanding carries with it eight twenty-sevenths of a right to
purchase from SouthTrust one one-hundredth of a share of SouthTrust Preferred
Stock designated as the Series A Junior Participating Preferred Stock at a
purchase price of $75.00 (a "Right"). These Rights will expire on February 22,
1999 unless redeemed earlier and are not exercisable or transferable separately
from the shares of SouthTrust Common Stock until the occurrence of certain
events associated with an acquisition of a substantial amount of SouthTrust
Common Stock. The provisions of the Rights are more fully described in the
Rights Agreement between SouthTrust and Mellon Bank, N.A. (now known as
ChaseMellon Shareholder Services LLC), as Rights Agent, and the Certificate of
Designation for the Series A Preferred Stock, copies of each of which are
exhibits to the Registration Statement.


<PAGE>   3

First American Bank
___________ ____, 1998
Page 3                           


                  Immediately prior to the Merger, SouthTrust will own 100% of
the capital stock of ST-Sub, and ST-Sub will own 100% of the capital stock of
ST-Bank. Both of ST-Sub and ST-Bank are included in the consolidated federal
income tax return of SouthTrust.

                  First American is a corporation organized pursuant to the
laws of the State of Florida and a registered bank holding company. As of March
31, 1998, the authorized capital stock of First American consisted of 213,000
shares of common stock, par value $10.00 per share, of which 128,865 shares
were issued and outstanding (the "First American Common Stock"). As of the date
of the Merger Agreement, a total of 128,865 shares of First American Common
Stock would be issued and outstanding (assuming that no options for First
American Common Stock shall have been exercised). First American is an accrual
method taxpayer using a calendar year accounting period.



                           THE PROPOSED TRANSACTIONS

                  Pursuant to the Merger Agreement the following transactions
will take place:

                  (1)      ST-Sub will acquire all of the assets and
liabilities of First American in exchange for voting common stock of SouthTrust
in a transaction in which ST-Sub directs that all of the assets and liabilities
of First American will be transferred to ST-Bank by means of a statutory merger
of First American into ST-Bank pursuant to the Merger Agreement.

                  (2)      First American will merge with and into ST-Bank in
accordance with Sections 655.412 and 658.40 through 658.45 of the Florida
Financial Institutions Code and in accordance with 12 U.S.C. ss. 215a, and
ST-Bank shall be the surviving corporation. ST-Bank will acquire all of the
assets and assume all of the liabilities of First American, and the separate
corporate existence of First American will terminate.

                  (3)      SouthTrust will issue a total of 243,168 shares of
SouthTrust Common Stock in exchange for all of the issued and outstanding First
American Common Stock (assuming that no options for First American Common Stock
shall have been exercised).

                  (4)      Each share of First American Common Stock will become
and be converted into the right to receive 1.887 shares of SouthTrust Common
Stock, and eight twenty-sevenths of a Right will be issued with each share of
SouthTrust Common Stock exchanged in the Merger for First American Common
Stock.


<PAGE>   4

First American Bank
___________ ____, 1998
Page 4                           


                  (5)      No fractional shares of SouthTrust Common Stock will 
be issued in the Merger; each holder of First American Common Stock who would
otherwise be entitled to receive a fractional share interest, if any, will
receive cash in lieu of a fractional share.

                  (6)      In accordance with Section 2.2 of the Merger
Agreement, obligations of First American under certain outstanding stock
options which entitle the holders thereof to acquire First American shares and
which were issued by First American (the "First American Options") will be
assumed by ST-Sub in accordance with the terms of the particular First American
Stock Option Plans under which such First American Options were issued and the
particular stock option agreements under which such First American Stock
Options are evidenced, and each such First American Option will be converted
into an option to acquire a number of SouthTrust shares equal to the number of
First American shares subject to such First American Option immediately prior
to the Effective Time multiplied by the Conversion Ratio, and the per share
exercise price under each such First American Option shall be adjusted by
dividing the per share exercise price under each such First American Option by
the Conversion Ratio and rounding down to the nearest cent.

                  (7)      Any holder of First American Common Stock who 
dissents from the Merger will be entitled to receive from the surviving
corporation the fair value of his or her shares in cash. Immediately prior to
the Effective Time of the Merger, First American will establish an escrow
account with an amount of cash equal to One Hundred and Fifty Percent (150%) of
the value of the SouthTrust Common Stock which the dissenting shareholders
would have been entitled to receive in the Merger but for the exercise of their
rights of dissent (the "Dissent Escrow"). The escrow agent will disburse the
escrowed funds to the dissenting shareholders in accordance with the Dissent
Provisions. Any and all funds remaining in the Dissent Escrow after such
disbursement will be remitted to ST-Bank as the surviving corporation.



                                REPRESENTATIONS

                  Officers of First American and SouthTrust each have made
certain written representations to us on behalf of their respective
institutions by letters each of even date herewith (the "Representation
Letters"), and with your consent, we have relied upon the accuracy and validity
of these representations provided in the Representation Letters in offering the
opinions expressed below.




<PAGE>   5

First American Bank
___________ ____, 1998
Page 5                           


                                    OPINION

                  Upon the basis of the foregoing facts and representations,
and solely for purposes of the Code, we are of the opinion that:

                  (i)      For federal income tax purposes the Merger will be
viewed as an acquisition by ST-Sub of substantially all of the assets of First
American solely in exchange for SouthTrust voting common stock and the
assumption of all the liabilities of First American by ST-Sub, followed by the
transfer of the assets of First American to ST-Bank and the assumption by
ST-Bank of the liabilities of First American.

                  (ii)     The acquisition by ST-Sub of substantially all of the
assets of First American in exchange solely for shares of SouthTrust voting
common stock and the assumption by ST-Sub of First American' s liabilities, as
described above, will constitute a reorganization within the meaning of Section
368(a)(1)(C) of the Code. For purposes of this opinion, "substantially all"
means at least ninety percent (90%) of the fair market value of the net assets
and at least seventy percent (70%) of the fair market value of the gross assets
of First American. Pursuant to Section 368(a)(2)(C) of the Code, the
acquisition by ST-Sub of substantially all of the assets of First American will
not be disqualified under Section 368(a)(1)(C) of the Code solely by reason of
the fact that the assets of First American that were acquired by ST-Sub are
transferred to ST-Bank. SouthTrust, ST-Sub and First American each will be a
"party to the reorganization" within the meaning of Section 368(b) of the Code.
The requirement under Section 368(a)(2)(G) of the Code that First American
distribute the stock, securities, and other properties it receives, as well as
its other properties, in pursuance of the plan of reorganization will be
satisfied by reason of the issuance by ST-Sub of the merger consideration
directly to the holders of First American Common Stock, and by reason of the
cessation of the separate corporate existence of First American pursuant to the
Merger Agreement and the applicable provisions of the Florida Code.

                  (iii)    No gain or loss will be recognized by the 
shareholders of First American upon the receipt of SouthTrust Common Stock
(including the Rights associated therewith) solely in exchange for their shares
of First American Common Stock. In addition, no gain or loss will be recognized
by First American shareholders upon the receipt of the Rights attached to the
SouthTrust Common Stock.

                  (iv)     The basis of the SouthTrust Common Stock to be 
received by the First American shareholders will be the same as the basis of
First American Common Stock surrendered in exchange therefor, except for the
basis allocated to any fractional shares.

                  (v)      The holding period of the shares of SouthTrust Common
Stock to be received by the shareholders of First American will include the
period during which First American Common Stock surrendered in exchange
therefor was held; provided that the shares of First American


<PAGE>   6

First American Bank
___________ ____, 1998
Page 6                           


Common Stock were held as capital assets within the meaning of Section 1221 of
the Code as of the Effective Time.

                  (vi)     First American shareholders who exercise dissenters'
rights, and as a result of which receive only cash, will be treated as having
received such cash as a distribution in redemption of their First American
Common Stock, subject to the provisions and limitations of Section 302 of the
Code. Those First American shareholders who hold no SouthTrust Common Stock,
directly or indirectly through the application of Section 318(a) of the Code,
following the Merger shall be treated as having a complete termination of
interest within the meaning of Section 302(b)(3) of the Code, and the cash
received will be treated as a distribution in full payment in exchange for
First American Common Stock as provided in Section 302(a) of the Code. As
provided in Section 1001 of the Code, gain or loss will be realized and
recognized by such shareholders measured by the difference between the
redemption price and the adjusted basis of the First American shares
surrendered as determined under Section 1011 of the Code. Provided Section 341
of the Code (relating to collapsible corporations) is inapplicable and the
First American Common Stock is a capital asset in the hands of such
shareholders, the gain, if any, will constitute capital gain. Such gain will
constitute a long-term capital gain if the surrendered First American shares
were held by the shareholder for a period greater than one year prior to the
Merger; if the surrendered First American shares where held by such shareholder
for a period of one year or less, the gain will constitute short-term capital
gain.

                  (vii)    The payment of cash to a First American shareholder
in lieu of issuing a fractional share interest in SouthTrust Common Stock will
be treated as if the fractional share actually was issued as part of the Merger
and then was redeemed by SouthTrust. This cash payment will be treated as
having been received as a distribution in full payment in exchange for the
fractional share of stock redeemed. Generally, any gain or loss recognized upon
such exchange will be a capital gain or loss.

                  Our opinion, as stated above, is based upon our analysis of
the Code, the regulations issued thereunder, current case law, and published
rulings of the Internal Revenue Service; the foregoing are subject to change,
and such changes may be given retroactive effect. In the event of such changes,
our opinion set forth above may be affected and may not be relied upon.
Furthermore, no opinion is expressed as to the federal tax treatment of the
transaction under any other provisions of the Code and regulations, or as to
the tax treatment of any conditions existing at the time of, or effects
resulting from, the transaction that are not specifically covered by the
opinion.

                  This opinion is rendered solely with respect to certain
federal income tax consequences of the Merger under the Code, and does not
extend to the income or other tax


<PAGE>   7

First American Bank
___________ ____, 1998
Page 7                           


consequences of the Merger under the laws of any state or any political
subdivision of any state; nor does it extend to any tax effects or consequences
of the Merger to SouthTrust, ST-Sub or ST- Bank other than those expressly
stated in the above opinion.

                  We hereby consent to the filing of this opinion as an exhibit
to the Registration Statement. We also consent to the references to this firm
under the heading "Certain Federal Income Tax Consequences" in the Registration
Statement and in the prospectus which is included as part of the Registration
Statement. In giving such consent, we do not thereby admit that we are in the
category of persons whose consent is required under Section 7 of the Securities
Act of 1933, as amended.

                                          Yours very truly,



<PAGE>   1

                                                                  EXHIBIT 23(A)





                   CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS





As independent public accountants, we hereby consent to the incorporation by
reference in this Registration Statement of our report dated February 13, 1998
included in SouthTrust Corporation's Form 10-K for the year ended December 31,
1997 and to all references to our Firm included in this Registration Statement.




                                          /s/ ARTHUR ANDERSEN

Birmingham, Alabama
October 30, 1998






<PAGE>   1

                                                                  EXHIBIT 23(B)



                         INDEPENDENT AUDITORS' CONSENT



         We consent to the inclusion in this Registration Statement of
SouthTrust Corporation on Form S-4 of our report dated February 3, 1998,
relating to the balance sheet of First American Bank of Indian River County as
of December 31, 1997, and the related statements of income, stockholders'
equity, and cash flows for the year then ended, and to the reference to us
under the heading "Experts" in the Prospectus, which is part of this
Registration Statement.




                                          /s/ REX MEIGHEN & CO.
                                          Rex Meighen & Company
                                          Certified Public Accountants


Tampa, Florida
November 3, 1998



<PAGE>   1

                                                                  EXHIBIT 23(C)



                              ACCOUNTANTS' CONSENT


The Board of Directors
First American Bank of Indian River County:


We consent to the use of our reports included herein (Form S-4 of SouthTrust
Corporation) and to the reference to our firm under the heading "Experts" in
the proxy statement/prospectus.




                                          /s/ KPMG PEAT MARWICK LLP



West Palm Beach, Florida
November 2, 1998



<PAGE>   1

                                                                  EXHIBIT 23(E)


                      [LETTERHEAD OF ALLEN C. EWING & CO.]







                        CONSENT OF ALLEN C. EWING & CO.

We hereby consent to the inclusion in the Proxy Statement/Prospectus forming
part of this Registration Statement on Form S-4 of SouthTrust Corporation of
our opinion as Exhibit B thereto and to the reference to such opinion and to
our firm therein. We also confirm the accuracy in all material respects of the
description and summary of our analyses, observations, beliefs and conclusions
relating thereto set forth under the heading "THE MERGER -- Opinion of Financial
Advisor" therein. In giving such consent, we do not admit that we come within
the category of persons whose consent is required under Section 7 of the
Securities Act of 1933 and the rules and regulations of the Securities and
Exchange Commission issued thereunder.

                                          Very truly yours,

                                          /s/ ALLEN C. EWING & CO.

Jacksonville, Florida
November 2, 1998



<PAGE>   1
STATE OF ALABAMA                    )                                 EXHIBIT 24
COUNTY OF JEFFERSON                 )


                                POWER OF ATTORNEY

                  KNOW ALL MEN BY THESE PRESENTS, that the undersigned director
whose signature appears below hereby constitutes and appoints Alton E. Yother
and William L. Prater, and each of them, his true and lawful attorneys-in-fact
and agents, with full power of substitution and resubstitution, for him and in
his name, place and stead, in any and all capacities, to sign a registration
statement of SouthTrust Corporation (the "Company") on Form S-4 relating to
shares of the Company proposed to be issued in connection with the Company's
proposed acquisition of First American Bank of Indian River County, including
all additional amendments to such registration statement, and to file the same,
with all exhibits thereto, and other documents in connection therewith, with the
Securities and Exchange Commission and with any state securities commission,
granting unto said attorneys-in-fact and agents, full power and authority to do
and perform each and every act and thing requisite and necessary to be done in
and about the premises, as fully to all intents and purposes as he might or
could do in person, hereby ratifying and confirming all that said
attorneys-in-fact and agents, or any of them, or their substitute or
substitutes, may lawfully do or cause to be done by virtue thereof.


<TABLE>
<CAPTION>

                    Signature                                     Date
                    ---------                                     ----
           <S>                                                 <C> 

           /s/  Allen J. Keesler, Jr.                          November 3, 1998
- -----------------------------------------------               
              Allen J. Keesler, Jr.


               /s/ Van L. Richey                               November 3, 1998
- -----------------------------------------------                
                  Van L. Richey


              /s/ Carl F. Bailey                               November 3, 1998
- -----------------------------------------------                
                 Carl F. Bailey


                                                                          1998
- -----------------------------------------------                ----------,
                 Rex J. Lysinger


             /s/ William C. Hulsey                             November 2, 1998
- -----------------------------------------------                
                William C. Hulsey


             /s/ John M. Bradford                              October 30, 1998
- -----------------------------------------------                
                John M. Bradford


                                                                          1998
- -----------------------------------------------                ----------,
           Wm. Kendrick Upchurch, Jr.


             /s/ H. Allen Franklin                             November 2, 1998
- -----------------------------------------------                
                H. Allen Franklin


             /s/ F. Crowder Falls                              October 30, 1998
- -----------------------------------------------                
                F. Crowder Falls


             /s/ Julian W. Banton                              November 2, 1998
- -----------------------------------------------                
                Julian W. Banton
</TABLE>

<PAGE>   1
                                                                     EXHIBIT 99
                   FIRST AMERICAN BANK OF INDIAN RIVER COUNTY
                                4000 20TH STREET
                           VERO BEACH, FLORIDA 32960

                     ------------------------------------

        PROXY FOR A SPECIAL MEETING OF SHAREHOLDERS -- DECEMBER __, 1998

(THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS OF FIRST AMERICAN
                         BANK OF INDIAN RIVER COUNTY)

         The undersigned shareholder of First American Bank of Indian River
County ("First American") hereby appoints Samuel A. Block and Charles R. Sexton,
Sr., and each or either of them, with full power of substitution, as attorneys
and proxies to vote all of the shares of common stock which the undersigned is
entitled to vote, with all powers which the undersigned would possess if
personally present at the Special Meeting of the Shareholders of First American
to be held at 780 U.S. Highway 1, Suite 101, Vero Beach , Florida, on December
___, 1998, at __:00 _.m., and at any adjournment or postponement thereof, upon
the matters set forth in the Notice of the Special Meeting, the Proxy
Statement/Prospectus, and in their discretion, upon such other matters as may
properly come before the meeting. The undersigned hereby acknowledges receipt of
the accompanying Notice of Special Meeting of Shareholders and Proxy
Statement/Prospectus.

         This Proxy, when properly executed and returned to First American,
will be voted as directed.

         (1)      Proposal to approve that certain Agreement and Plan of Merger,
dated as of July 1, 1998, as amended by the Amendment No. 1 to Agreement and
Plan of Merger dated September 14, 1998 (as amended, the "Merger Agreement"),
by and between First American and SouthTrust Bank, National Association
("ST-Bank"), and joined in by SouthTrust of Alabama, Inc., an Alabama
corporation ("ST-Sub") and SouthTrust Corporation, a Delaware corporation
("SouthTrust"), whereby First American will be merged with and into ST-Bank and
the holders of First American common stock will receive 1.887 shares of
SouthTrust common stock, with cash being paid in lieu of issuing fractional
shares, for each share of First American common stock, all pursuant to and in
accordance with the terms and conditions of the Merger Agreement, all as more
fully described in the Proxy Statement/Prospectus dated _______ ___,1998; and

           FOR [ ]                AGAINST [ ]                ABSTAIN []

         (2)      Other Matters:

                  [ ]      In their discretion, upon such other matters as may
                           properly come before the special meeting of
                           shareholders or any adjournment or postponements
                           thereof.

                  [ ]      Authority withheld to vote upon such matters.

UNLESS OTHERWISE SPECIFIED, THE PROXY WILL BE VOTED FOR PROPOSAL (1). PLEASE
RETURN THIS PROXY IN THE SELF-ADDRESSED POSTAGE PAID ENVELOPE PROVIDED AS
PROMPTLY AS PRACTICAL, REGARDLESS OF WHETHER OR NOT YOU EXPECT TO ATTEND THE
MEETING IN PERSON. IF YOU DO ATTEND, YOU MAY WITHDRAW YOUR PROXY AND VOTE IN
PERSON SHOULD YOU SO DESIRE.


                                         --------------------------------------
                                             (Signature(s) of Shareholder)

                                             Dated:______________, 1998

                                         --------------------------------------
                                             (co-owner, if any)

                                             Dated:______________, 1998


Please date and sign exactly as name appears hereon. If shares are held
jointly, each shareholder should sign. Agents, executors, administrators,
guardians, trustees, etc., should use full title, and, if more than one, all
should sign. If the shareholder is a corporation or other entity, please sign
full corporate or entity name by an authorized officer.







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