SCHEDULE 14A
(Rule 14a-101)
INFORMATION REQUIRED IN PROXY STATEMENT
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the Securities
Exchange Act of 1934 (Amendment No. )
[x] Filed by the Registrant
[ ] Filed by a Party other than the Registrant
[ ] Check the appropriate box:
[ ] Preliminary Proxy Statement
[ ] Confidential, for Use of the Commission Only
(as permitted by Rule 14a-6(e)(2))
[x] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to Rule 14a-11(c) or Rule 14a-12
The Colonial BancGroup, Inc.
_______________________________________________
(Name of Registrant as Specified In Its Charter)
_______________________________________________________________________
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
[x] No fee required.
[ ] Fee computed on table below per Exchange Act Rules 14a-6(I)(1) and 0-11.
(1) Title of each class of securities to which transaction applies:
_______________________________________________________________
(2) Aggregate number of securities to which transaction applies:
_______________________________________________________________
(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (set forth the amount on which
the filing fee is calculated and state how it was determined):
_______________________________________________________________
(4) Proposed maximum aggregate value of transaction:
_______________________________________________________________
(5) Total fee paid:
_______________________________________________________________
[ ] Fee paid previously with preliminary materials:
[ ] Check box if any part of the fee is offset as provided by Exchange Act
Rule 0-11(a)(2) and identify the filing for which the offsetting fee was
paid previously. Identify the previous filing by registration statement
number, or the Form or Schedule and the date of its filing.
(1) Amount Previously Paid:
________________________________________________________________
(2) Form, Schedule or Registration Statement No.:
________________________________________________________________
(3) Filing Party:
________________________________________________________________
(4) Date Filed:
________________________________________________________________
<PAGE>
TO OUR STOCKHOLDERS:
The annual meeting of the stockholders of The Colonial BancGroup, Inc., will
be held at 10:00 a.m., Wednesday, April 21, 1999, at the Colonial Financial
Center, One Commerce Street, Montgomery, Alabama.
Enclosed is a Notice of the meeting, a Proxy Statement, a proxy card and the
Annual Report to Shareholders for 1998. We hope that you will study the
enclosed material carefully and attend the meeting in person.
Whether you plan to attend the meeting or not, please sign and date the
enclosed proxy card and return it in the accompanying envelope as promptly as
possible. The proxy may be revoked by your vote in person at the meeting, by
your execution and submission of a later dated proxy, or by your giving
written notice of revocation to the Secretary of The Colonial BancGroup,
Inc., at any time prior to the voting thereof. Thank you for your support.
Sincerely,
/s/ ROBERT E. LOWDER
_________________________________________________
Robert E. Lowder
Chairman of the Board and Chief Executive Officer
March 17, 1999
<PAGE>
NOTICE
of the
ANNUAL MEETING OF STOCKHOLDERS
of
THE COLONIAL BANCGROUP, INC.
To Be Held April 21, 1999
NOTICE IS HEREBY GIVEN that the annual meeting of stockholders of The
Colonial BancGroup, Inc. ("BancGroup"), a Delaware corporation, will be held
at the Colonial Financial Center, One Commerce Street, Montgomery, Alabama,
on Wednesday, April 21, 1999, at 10:00 a.m., central time, for the following
purposes:
1. To elect the nominees named in the Proxy Statement as directors to
serve for a term of three years.
2. To transact such other business as may properly come before the
meeting or any adjournments thereof but which is not now
anticipated.
Details respecting these matters are set forth in the accompanying Proxy
Statement. Only stockholders of record at the close of business on March 8,
1999, will be entitled to notice of, and to vote at, the meeting. A complete
list of the stockholders entitled to vote at the meeting, arranged in
alphabetical order and showing the address of each stockholder and the number
of shares registered in the name of each stockholder, shall be open to
examination by any stockholder at BancGroup's principal office at One
Commerce Street, Montgomery, Alabama, during ordinary business hours for any
purpose germane to the meeting. Such list will be open for a period of at
least ten days prior to the meeting.
All stockholders of BancGroup are cordially invited to attend the
meeting in person. WHETHER OR NOT YOU PLAN TO ATTEND THE MEETING IN PERSON,
PLEASE SIGN AND DATE THE ENCLOSED PROXY CARD AND RETURN IT IN THE
ACCOMPANYING ENVELOPE AS PROMPTLY AS POSSIBLE. THE PROXY MAY BE REVOKED BY
YOUR VOTE IN PERSON AT THE MEETING, BY YOUR EXECUTION AND SUBMISSION OF A
LATER DATED PROXY, OR BY YOUR GIVING WRITTEN NOTICE OF REVOCATION TO THE
SECRETARY OF THE COLONIAL BANCGROUP, INC. AT ANY TIME PRIOR TO THE VOTING
THEREOF.
By Order of the Board of Directors
/s/ W. FLAKE OAKLEY, IV
________________________________
W. Flake Oakley, IV
Executive Vice President,
Chief Financial Officer,
Treasurer and Secretary
March 17, 1999
<PAGE>
THE COLONIAL BANCGROUP, INC.
One Commerce Street
Post Office Box 1108
Montgomery, Alabama 36101
Telephone: 334-240-5000
PROXY STATEMENT
FOR 1999 ANNUAL MEETING OF STOCKHOLDERS
This Proxy Statement and the accompanying proxy are furnished on or
about March 17, 1999, by The Colonial BancGroup, Inc. ("BancGroup") to the
holders of record of common stock, par value $2.50, of BancGroup (the "Common
Stock") in connection with BancGroup's annual meeting of stockholders (the
"Annual Meeting"), and any adjournments thereof, to be held on Wednesday,
April 21, 1999, at 10:00 a.m. at the Colonial Financial Center, One Commerce
Street, Montgomery, Alabama. The matters to be considered and acted upon,
including the election of directors, are described herein.
The Board of Directors of BancGroup (the "Board") recommends the
election of the five director-nominees named in this Proxy Statement for a
term of three years as described herein.
The enclosed proxy is solicited on behalf of the Board and is revocable
at any time prior to the voting of such proxy by giving written notice of
revocation to the Secretary of BancGroup, or by executing and submitting a
later dated proxy, or by voting in person at the Annual Meeting. Mere
attendance at the Annual Meeting without submitting a later dated proxy will
not be sufficient to revoke a previously submitted proxy. All properly
executed proxies delivered pursuant to this solicitation will be voted at the
Annual Meeting and in accordance with instructions, if any. If no
instructions are given, the proxies will be voted FOR election of the
director-nominees named herein, and in accordance with the instructions of
management as to any other matters that may come before the Annual Meeting.
The cost of soliciting proxies will be borne by BancGroup. In addition
to the use of the mails, proxies may be solicited by personal interview,
telephone or telegraph, and banks, brokers, nominees or fiduciaries will be
required to forward the soliciting material to the principals and to obtain
authorization of the execution of proxies. BancGroup may, upon request,
reimburse banks, brokers and other institutions, nominees and fiduciaries for
their expenses in forwarding proxy material to the principals. BancGroup has
retained the firm of Georgeson & Co. to solicit street-name holders and will
pay such firm a fee of $6,500.
Stockholders Eligible to Vote
This Proxy Statement is furnished to the holders of Common Stock who
were holders of record as of the close of business on March 8, 1999. Only
those holders are eligible to vote at the Annual Meeting.
Votes will be tabulated and counted by one or more inspectors of
election appointed by the Chairman of the Board. Proxies marked as
abstentions and shares held in street names which have been designated by
brokers on proxy cards as not voted will not be counted as votes cast. Such
proxies will be counted for purposes of determining a quorum at the Annual
Meeting. A quorum consists of a majority of the shares of Common Stock
outstanding.
VOTING SECURITIES AND PRINCIPAL STOCKHOLDERS
As of March 8, 1999, BancGroup had issued and outstanding 111,544,480
shares of Common Stock with approximately 9,911 stockholders of record.
Each such share is entitled to one vote. In addition, as of that date,
2,203,840 shares of Common Stock were subject to issue upon the exercise of
options pursuant to BancGroup's stock option plans, and up to 523,571 shares
of Common Stock were issuable upon conversion of BancGroup's Convertible
Subordinated Debentures. There are currently 200,000,000 shares of Common
Stock authorized. BancGroup is not aware of any material change in the
ownership of Common Stock since Mary 8, 1999.
Principal Stockholders
The following table shows the only person who is known to BancGroup to
be the beneficial owner as of March 8, 1999, of more than 5% of BancGroup's
outstanding Common Stock.
<TABLE>
<CAPTION>
Shares of BancGroup
Beneficially Owned
________________________________
Percentage
Common of Class
Name and Address Stock Outstanding
________________ _____________ ___________
<S> <C> <C>
Robert E. Lowder (1) 5,886,498 (2) 5.26%
Post Office Box 1108
Montgomery, AL 36101
<FN>
(1) Robert E. Lowder, James K. Lowder and Thomas H. Lowder are brothers and
are sometimes referred to herein as the "Lowder brothers." Catherine K.
Lowder is the mother of the Lowder brothers. Catherine Lowder Struble and
Edward W. Lowder are the adult children of Robert E. Lowder. James K.
Lowder, Thomas H. Lowder, Catherine K. Lowder, Catherine Lowder Struble,
and Edward W. Lowder are estimated to beneficially own 4,374,032;
4,273,352; 341,768; 25,240; and 23,520 shares, respectively. Robert E.
Lowder disclaims any beneficial ownership interest in the shares owned
by his brothers, mother, or adult children.
(2) Includes 402,040 shares of Common Stock subject to options under
BancGroup's stock option plans. Additionally, Mr. Lowder has options to
purchase 60,000 shares which will vest at the rate of 20,000 shares each
on January 15, 2000; January 15, 2001; and January 15, 2002,
respectively. Further, Mr. Lowder holds additional options to purchase
another 100,000 shares which will vest at the rate of 20% per year
beginning on December 30, 1999.
</FN>
</TABLE>
Security Ownership of Management
The following table indicates for each director, director-nominee,
executive officer, and all executive officers and directors of BancGroup as
a group the number of shares of outstanding Common Stock beneficially owned
on March 8, 1999.
<TABLE>
<CAPTION>
Shares of BancGroup
Beneficially Owned
___________________________________
Percentage
Common of Class
Name Stock Outstanding
____ ______________ ________________
<S> <C> <C>
DIRECTORS
Lewis Beville 4,344 *
William Britton 38,779 (1) *
Jerry J. Chesser 305,537 *
Augustus K. Clements, III 41,395 *
Robert S. Craft 35,442 (2) *
Patrick F. Dye 61,920 *
James L. Hewitt 911,841 (3) *
Clinton O. Holdbrooks 607,800 (4) *
Harold D. King 297,162 (5) *
Robert E. Lowder 5,886,498 (6) 5.26%
John Ed Mathison 60,078 (7) *
Milton E. McGregor -0- *
John C.H. Miller, Jr 80,704 (8) *
Joe D. Mussafer 42,487 *
William E. Powell, III 29,072 *
Jack H. Rainer 6,380 *
Jimmy Rane 2,953 (9) *
Frances E. Roper 735,629 *
Simuel Sippial 11,061 *
Ed V. Welch 62,523 *
EXECUTIVE OFFICERS WHO ARE NOT ALSO DIRECTORS
Young J. Boozer, III 179,737 (10)(11) *
Michelle M. Condon 35,989 (11) *
P.L. McLeod, Jr 136,394 (11) *
W. Flake Oakley, IV 95,310 (11) *
All Executive Officers and
Directors as a Group 9,669,035 8.61%
<FN>
* Represents less than 1%.
(1) Includes 7,232 shares owned by Mr. Britton's wife. Mr. Britton disclaims
beneficial ownership.
(2) Includes 2,604 shares held by the IRA of Mr. Craft's wife. Mr. Craft
disclaims beneficial ownership.
(3) Includes 125,364 shares subject to options under
BancGroup's stock option plans.
(4) Includes 128,996 shares held by Mr. Holdbrooks as trustee.
(5) Includes 40,780 shares owned by Mr. King's wife. Mr. King disclaims
beneficial ownership.
(6) Includes 402,040 shares subject to options under BancGroup's stock
option plans. Additionally, Mr. Lowder has options to purchase 60,000
shares which will vest at the rate of 20,000 shares each on January
15, 2000; January 15, 2001; and January 15, 2002, respectively.
Further, Mr. Lowder holds additional options to purchase
another 100,000 shares which will vest at the rate of 20% per year
beginning on December 30, 1999.
(7) Includes 2,000 shares owned by Dr. Mathison's wife. Dr. Mathison
disclaims beneficial ownership.
(8) Includes 40,000 shares subject to options under BancGroup's stock
option plans.
(9) Includes 2,000 shares owned by Mr. Rane's Keogh Plan .
(10) Young J. Boozer, III holds a power of attorney to vote shares of stock
owned by his father, Young J. Boozer, Jr. This number includes 32,104
shares owned by Young J. Boozer, Jr. and 4,000 shares owned by Young
J. Boozer, Jr. and Young J. Boozer, III, EX U/W Phyllis C. Boozer.
(11) Young J. Boozer, III, Michelle M. Condon, P.L. McLeod, Jr. and W. Flake
Oakley, IV hold vested options respecting 47,000, 20,090, 64,800 and
44,000 shares, respectively, pursuant to BancGroup's stock option plans,
not counting options that are not exercisable within 60 days of
March 8, 1999, due to vesting requirements.
</FN>
</TABLE>
ELECTION OF DIRECTORS
The Board recommends that the stockholders elect the five persons named
below to hold office for a term of three years, or until their successors
are elected and qualified. BancGroup's Restated Certificate of Incorporation
provides that the number of directors which shall constitute the entire Board
shall be fixed from time to time by resolutions adopted by the Board, but
shall not be less than three persons. If the stockholders elect directors as
recommended by the Board, then the Board shall consist of 19 members. By
resolution, the Board has fixed the maximum number of directors at 23.
BancGroup's Restated Certificate of Incorporation provides for the
election of directors by classes to terms of three years, with one class of
approximately one-third of the total number of directors to be elected each
year. Five nominees are proposed for election to the class of directors whose
terms expire in 2002. At the Annual Meeting, proxies cannot be voted for a
number of directors greater than five.
If, prior to the voting at the Annual Meeting, any person proposed for
election as a director is unable to serve or for good cause cannot serve, the
shares represented by all valid proxies may be voted for the election of such
substitute as the members of the Board may recommend. BancGroup management
knows of no reason why any nominated person would be unable to serve as a
director.
Assuming a quorum is present at the Annual Meeting, a plurality of the
votes cast will be sufficient to elect the directors. On the proxy card,
voting for directors is Proposal 1.
The bylaws of BancGroup contain certain limitations on stockholder
nominations of candidates for election as directors. See "Bylaw Provisions
Regarding Conduct of Stockholders' Meetings."
The following table provides certain biographical information about each
nominee to be proposed on behalf of the Board and the directors whose terms
will not expire until 2000 and 2001. Unless otherwise indicated, each person
has been engaged in the principal occupation shown for the last five years.
Executive officers serve at the discretion of the Board.
<TABLE>
DIRECTORS TO BE NOMINATED ON BEHALF OF THE BOARD
FOR A TERM EXPIRING IN 2002:
<CAPTION>
Name, Age and Year Position and Office Held with Present and Principal Occupation
Became Director BancGroup and Subsidiaries(1) for the Last Five Years
_________________________ _____________________________ ________________________________
<S> <C> <C>
William Britton Director, BancGroup; Muscle Shoals Mack Sales, Inc. (truck)
74, 1985 Director, Northwest service and retail sales business),
Region, Member, Audit Muscle Shoals, AL
Committee
Patrick F. Dye Director, BancGroup; Special Advisor, Auburn
59, 1981 Member, Asset-Liability University; since December,
Committee 1992; Head Football Coach
and Athletic Director,
Auburn University,
1981-1992, Auburn, AL
Milton E. McGregor Director, BancGroup; President and CEO, Macon
59, 1993 Member, Personnel and County Greyhound Park
Compensation Committee d/b/a Victoryland;
President and CEO,
Jefferson County Racing
Association (greyhound racing
facility) since 1992,
Montgomery, AL
Jack H. Rainer Vice Chairman, BancGroup President and Chief Executive
76, 1981 Officer, Bankers Credit Life
Insurance Company, until 1997;
Vice Chairman, BancGroup,
Montgomery, AL
Simuel Sippial Director, BancGroup; President, Sippial Enterprises
55, 1997 Director, Colonial Bank; Inc. (real estate investments),
Director, Montgomery Montgomery, AL
Region; Member, Personnel
and Compensation Committee;
Director, Colonial Mortgage
Company
CONTINUING DIRECTORS WHOSE TERMS EXPIRE IN 2000:
Lewis Beville Director, BancGroup Vice President of Thames, Batre,
47, 1997 Director, Gulf Coast Mattei, Beville and Ison
Region; Chairman, Audit (insurance agency),
Committee Mobile, AL
Jerry J. Chesser Director, BancGroup; President, Shelby Contracting
62, 1984 Chairman of the Board, Co., Inc. (general contractor),
Huntsville Region; Huntsville, AL
Member, Audit Committee
John Ed Mathison Director, BancGroup; Senior Minister, Frazer
60, 1987 Director, Montgomery Memorial United Methodist
Region; Member, Personnel Church, Montgomery, AL
and Compensation Committee
Joe D. Mussafer Director, BancGroup; President, Montgomery Beverage
59, 1981 Director, Montgomery Company, Inc. (wholesale
Region; Member, Personnel beverage distributorship),
and Compensation Committee Montgomery, AL
William E. Powell, III Director, BancGroup; Executive Vice President,
54, 1987 Director, Montgomery Alabama Cattlemen's Association
Region; Member, Asset-Liability (trade association representing
Committee the beef cattle industry),
Montgomery, AL
Frances E. Roper Director, BancGroup; Owner, Roper's Flowers
79, 1984 Director, Huntsville Region; (retail florist); Owwner,
Member, Personnel and Frances Roper Corporation
Compensation Committee; (renting and leasing properties),
Member, Audit Committee Huntsville, AL
Ed V. Welch Director, BancGroup; Chairman of the Board,
66, 1981 Director, Montgomery Welch, Hornsby & Welch, Inc.,
Region; Member, Asset-Liability (investment advisory firm)
Committee and Trinity Investments, Inc.,
(investment holding company),
since May 1994; Chairman of
the Board and Chief Executive
Officer, AgriPro BioSciences,
Inc., Octobery 1987-May 1994,
Montgomery, AL
DIRECTORS WHOSE TERMS EXPIRE IN 2001:
Augustus K. Clements, III Director, BancGroup; General Agent, New England
56, 1995 Director, Colonial Bank; Financial/The Clements Agency
Director, Montgomery Region; (insurance), Montgomery, AL
Member, Executive Committee
Robert S. Craft Director, BancGroup; President, Craft Development Corp.
47, 1992 Chairman of the Board, (golf course ownership and
Gulf Coast Region; development, Managing Partner,
Member, Executive Committee Pinehurst Development (real estate
development); President, Craft Land
Company, Inc. (real estate
development); Partner, Craft
Turf Farms (turf grass production
and sales); President, Wingo Trucking
(trucking company); Managing
Member, Woodlands Management
Co. (golf course management);
Managing Member, Bright's Creek
Development Co. (golf course
ownership); Managing Member, TRI-
TEL, LLC (hotel ownership);
President, Cotton Creek
Condominium Development Corp.
(condominium development), Foley,
Alabama.
Clinton O. Holdbrooks Director, BancGroup; Chairman of the Board,
60, 1986 Chairman of the Board, East Central Region
East Central Region; since January 1998
Member, Asset-Liability
Committee
Harold D. King Vice Chairman, Vice Chairman, BancGroup;
66, 1986 BancGroup; Director, since Octobery 1987, Pell
Birmingham Region; City, AL
Director, East Central Region;
Director, Colonial Bank;
Member, Executive Committee
Robert E. Lowder* Chairman of the Board and Chairman of the Board and
56, 1981 Chief Executive Officer, Chief Executive Officer, Colonial
Colonial BancGroup; Chairman BancGroup; Chairman of the Board
of the Board and Chief and Chief Executive Officer,
Executive Officer, Colonial Colonial Bank; Chairman of the
Bank; Director, Birmingham Board, Colonial Mortgage Co.;
Region; Director, Huntsville Chairman of the Board and
Region; Director, Northwest President, Colonial Broadcasting,
Region; Director, East until 1998, Montgomery, AL
Central Region; Director,
Gulf Coast Region; Director,
Montgomery Region; Director,
Central Florida Region;
Director, South Florida
Region; Director, Bay Area
Region; Director, Southwest
Florida Region; Chairman of
the Board, Atlanta Region;
Director, Dallas Region;
Director, Nevada Region;
Director, Central Georgia Region;
Chairman, Executive Committee,
Colonial BancGroup; Chairman of
the Board, Colonial Mortgage Co.
John C. H. Miller, Jr. Director, BancGroup; Partner, Miller, Hamilton
55, 1981 Director, Gulf Coast Region; Snider & Odom, L.L.C.
Chairman, Personnel (law firm), Mobile, AL
Compensation Committee;
Member, Executive Committee
Jimmy Rane Director, BancGroup; President, Great Southern
51, 1997 Member, Audit Committee Wood Preserving, Inc., Great
Southern Wood of Florida, Inc.
and Great Southern Wood of
North Alabama, Inc.
(lumber company),
Abbeville, AL
<FN>
* Indicates that the director is also an executive officer.
(1) All references to the word "Region" refer to a region of Colonial Bank.
</FN>
</TABLE>
BancGroup's Restated Certificate of Incorporation provides that there
shall be an Audit Committee of the Board composed of not less than three
directors appointed by the Board at least annually, none of whom shall be
active officers of BancGroup, whose duty it shall be to make an examination
at least once each year into the financial affairs of BancGroup and to report
the results of their examination in writing to the Board at its next regular
meeting. The Audit Committee may make recommendations to the Board and, with
the approval of the Board, may employ an independent qualified firm of
certified public accountants. The Audit Committee of the Board presently
consists of Lewis Beville, Chairman, William Britton, Jerry J. Chesser,
Frances E. Roper, and Jimmy Rane. The Audit Committee met four times in 1998.
BancGroup has a Personnel and Compensation Committee presently
consisting of John C.H. Miller, Jr., Chairman, Joe D. Mussafer, Milton E.
McGregor, John Ed Mathison, Frances E. Roper, and Simuel Sippial. The
principal functions of this committee are to make recommendations from
time to time to the Board regarding compensation and personnel matters,
compensation plans in which officers and directors are eligible to
participate, the establishment of or changes in benefit plans in which
officers and employees participate, and personnel policies. A subcommittee
of this committee consisting of Joe D. Mussafer, Frances E. Roper and Simuel
Sippial performs these functions regarding executive officers of BancGroup.
The committee met one time and the subcommittee met three times in 1998
(See "Executive Compensation Committee Report").
BancGroup has no nominating committee.
BancGroup has an Executive Committee presently consisting of Robert E.
Lowder, Chairman, Augustus K. Clements, III, Robert S. Craft, Harold D. King,
and John C.H. Miller, Jr. The principal functions of this committee are to
perform certain actions in lieu of the Board at times when a meeting of the
full Board is not feasible or practicable. The committee met one time in
1998, and took two Actions by Unanimous Written Consent in 1998.
During 1998, the Board met five times. All current directors attended
75% or more of these meetings.
SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
Section 16(a) of the Securities Exchange Act of 1934 requires
BancGroup's directors, certain officers and 10% stockholders, if any, to
file reports of ownership and changes in ownership with the Securities and
Exchange Commission (the "SEC"). Such officers, directors and 10% stockholders,
if any, are required by SEC regulations to furnish BancGroup with copies of
all Section 16(a) reports they file, including reports on Form 5 which are
filed with the SEC annually.
Based solely on its review of the copies of such forms received by it,
or written representations from certain reporting persons that no reports on
Form 5 were required for those persons, BancGroup believes that during 1998
all filings applicable to its officers, directors and 10% stockholders were
made timely, except as follows: 50,000 shares were purchased by Patrick F.
Dye on September 14, 1998, pursuant to exercise of BancGroup issued stock
options. A report was filed on Form 4 on November 3, 1998. William Britton
purchased 3,000 shares on August 17, 1998. A report was filed on Form 4 on
September 17, 1998. Jerry J. Chesser purchased 5,800 shares on July 29, 1998. A
report was filed on Form 5 on February 11, 1999. Jack H. Rainer purchased
1,000 shares on December 18, 1998. A report was filed on Form 5 on February
11, 1999.
COMPENSATION COMMITTEE INTERLOCKS
AND INSIDER PARTICIPATION
The Personnel and Compensation Committee of BancGroup consists of John
C.H. Miller, Jr., Chairman, Frances E. Roper, Milton E. McGregor, Joe D.
Mussafer, John Ed Mathison, and Simuel Sippial. Mr. Miller is a partner in
the law firm of Miller, Hamilton, Snider & Odom, L.L.C. Such firm performed
legal services for BancGroup and its subsidiary bank, Colonial Bank, in 1998
and received approximately $1,198,305 in fees. In addition, as described
below at "Executive Compensation - Director Compensation," Mr. Miller
received employment-related compensation of $41,000 from BancGroup in 1998.
See "Other Transactions".
Robert E. Lowder, Chief Executive Officer, Chairman and a principal
stockholder of BancGroup, is the brother of James K. Lowder and Thomas H.
Lowder, who are stockholders of BancGroup. For a discussion of certain
transactions between such persons and BancGroup, see "Certain Transactions
with The Colonial Company and the Lowder Brothers," which follows immediately
below.
Certain Transactions with The Colonial Company and the Lowder Brothers
BancGroup and its subsidiaries lease office space in the Colonial
Financial Center in Montgomery, Alabama, from GC Associates I, Joint Venture,
a partnership owned 50% by affiliates of the Lowder brothers. The lease
agreements, which began in 1987 and 1993 and expire in 1999 through 2007,
provide that BancGroup and its subsidiaries will pay rent of approximately
$1,483,234 in the aggregate, per annum, subject to certain adjustments,
to GC Associates I.
Colonial Bank currently leases the real estate on which one of its
Montgomery, Alabama branches is located from the Lowder brothers for an
annual rental of $6,000. This lease commenced in 1974, was renewed in 1994
and has a five-year term.
BancGroup currently leases office space in Montgomery, Alabama, from
Colonial Realty Limited Partnership ("Colonial Realty"), a company in which
the Lowder brothers own 39.4% of the partnership units, excluding those
units held by Colonial Properties Trust, the general partner of Colonial
Realty Limited Partnership. This lease commenced in 1989 and expires in
2000. BancGroup's subsidiaries will pay approximately $181,296 per annum,
subject to certain adjustments, to Colonial Realty.
BancGroup subsidiaries also lease space from Colonial Properties Trust
("Colonial Properties"), in which the Lowder brothers own 15.4% of the
outstanding shares, including shares issuable upon conversion of units in
Colonial Realty and options exercisable within 60 days, for operations
areas and a branch office in Montgomery, Alabama. These leases commenced
in 1989 and 1992 and expire in 1999 and 2002, respectively. BancGroup's
subsidiaries will pay approximately $172,749 per annum, subject to
certain adjustments, as lease payments to Colonial Properties.
REL Services Inc. ("REL Services"), a corporation wholly owned by Robert
E. Lowder, provides the use of aircraft to BancGroup and its subsidiaries
pursuant to an agreement entered into in April, 1998, and amended in January,
1999. The agreement provides that BancGroup and its subsidiaries shall pay
REL Services $1,920,000 per year in monthly installments for the use of a
Cessna Citation aircraft owned by REL Services for unlimited hours of flight
and ground time per year. Further, in October 1998, REL Services assigned to
Colonial Bank, and Colonial Bank assumed, REL Services' obligations under an
agreement to purchase a Citation Excel Aircraft from the Cessna Aircraft
Company.
In 1998, Colonial Bank paid $53,093 to Colonial Broadcasting Company
("Broadcasting") for advertising by Colonial Bank on radio stations owned by
Broadcasting. Broadcasting was a subsidiary of a company which was wholly
owned by Robert E. Lowder, prior to being sold in June, 1998 to an
unrelated third party.
With respect to the preceding transactions, management of BancGroup
believes that such arrangements are at least as favorable to BancGroup as
those which might be negotiated with unaffiliated parties for similar
transactions.
Other Transactions
BancGroup has retained in the past and proposes to retain in the future
on behalf of BancGroup or its subsidiaries the law firm of Miller, Hamilton,
Snider & Odom, L.L.C., Mobile, Alabama, of which a director of BancGroup,
John C.H. Miller, Jr., is a partner. Legal fees and expenses paid or accrued
to this firm by BancGroup and its subsidiaries were approximately $1,198,305
for 1998.
In February 1999, Colonial Bank purchased real estate in St. Clair
County, Alabama, from a partnership in which Harold D. King owned a 25%
interest and his wife owned a 25% interest. The purchase price was $348,500.00.
Mr. King currently serves as Vice Chairman of BancGroup's Board of Directors.
The sale was negotiated between the Regional President for Colonial Bank's
East Central Region and another partner of the above-mentioned partnership.
The purchase price was negotiated after a review of recent comparable sales
in the same geographic area. The partnership had owned the property since
May 1, 1992.
Management of BancGroup believes that such arrangement and transaction
at least as favorable to BancGroup as that which might be negotiated with an
unaffiliated party for similar arrangement and transaction.
Loans
Certain directors, officers and principal stockholders of BancGroup and
their affiliated interests were customers of and had transactions with
Colonial Bank in the ordinary course of its business during the past year.
Additional transactions may be expected to take place in the ordinary course
of business. Included in such transactions were outstanding loans and
commitments from Colonial Bank, all of which were made in the ordinary course
of business on substantially the same terms, including interest rates and
collateral, as those prevailing at the time for comparable transactions with
other persons and did not involve more than the normal risk of collectability
or present other unfavorable features.
EXECUTIVE COMPENSATION
Summary Compensation Table
The following table presents for the last three fiscal years of
BancGroup the compensation paid to the Chief Executive Officer of BancGroup
and the four most highly compensated executive officers of BancGroup, in
addition to the Chief Executive Officer, whose total annual salary and bonus
for 1998 exceeded $100,000.
<TABLE>
<CAPTION>
Long Term All Other
Annual Compensation Compensation Awards Compensation(2)
______________________________ _______________________ _______________
Restricted Securities
Name and Stock Underyling
Principal Position Year Salary($) Bonus($) Awards($) Options(#)
__________________ ____ _________ ________ __________ __________ _______________
<S> <C> <C> <C> <C> <C> <C>
Robert E. Lowder 1998 $848,077 -- $ 56,532(1) 100,000(6) $6,620
Chairman and 1997 798,492 -- 427,025(3) -- 6,370
CEO 1996 743,72 $277,397 253,000(3) 100,000(4) 5,657
P.L. McLeod, Jr.* 1998 229,231 -- -- 40,000(6) 5,288
President 1997 195,192 50,000 -- 24,000(5) 4,924
1996 167,523 30,000 118,125(3) 60,000 4,362
W. Flake Oakley, IV 1998 179,317 -- -- 40,000(6) 5,000
Executive Vice 1997 161,865 25,000 -- 20,000(5) 4,422
President, Chief 1996 151,971 15,000 118,125(3) 40,000 4,247
Financial Officer,
Treasurer and
Secretary
Young J. Boozer, III 1998 132,846 -- -- -- 3,321
Executive Vice 1997 125,769 -- -- -- 3,269
President 1996 119,985 5,000 -- -- 3,184
Michelle M. Condon 1998 130,000 -- -- 2,500(6) 3,427
Executive Vice 1997 114,231 3,000 34,375(3) 4,000(5) 2,981
President 1996 99,717 5,000 39,375(3) 24,000 2,704
<FN>
* The Board elected Mr. McLeod to serve as President on October 15, 1997.
(1) Represents the market value as of December 31, 1998, of 4,711 shares of
Common Stock awarded in lieu of cash director fees pursuant to
BancGroup's Restricted Stock Plan for Directors. These shares vest at
the conclusion of the director's term during which they were awarded. At
December 31, 1998, the market value of these shares was $12.00 per
share.
(2) The amounts shown in this column for Mr. Lowder consist of $5,000 in
contributions by BancGroup to the 401(k) and Profit Sharing Plan and
$1,620 for company-paid insurance premiums paid in 1998, $4,750 and
$1,620 paid in 1997, and $4,620 and $1,037 paid in 1996, respectively.
The amounts for Mr. McLeod consist of $5,000 in contributions by
BancGroup to the 401(k) and Profit Sharing Plan and $288 for
company-paid insurance premiums paid in 1998, $4,750 and $174
paid in 1997, and $4,188 and $174 paid in 1996, respectively. The
amounts shown for all other persons reflect only contributions by
BancGroup to the 401(k) and Profit Sharing Plan.
(3) Represents the market value, on the date of grant, of shares awarded
under BancGroup's Stock Bonus Plan. Mr. Lowder and Ms. Condon were
granted 20,000 and 2,000 shares, respectively, on January 2, 1998,
based on 1997 performance; Mr. Lowder was granted 21,404 shares on
January 15, 1997 based on 1996 performance; and Mr. McLeod, Mr. Oakley,
and Ms. Condon, were granted 12,000, 12,000, and 4,000 shares,
respectively, on December 19, 1996, based on 1996 performance. These
shares vest at 20% per year beginning one year from the date of grant.
The holder is entitled to receive dividends on these shares and to vote
the shares prior to vesting.
The following table provides information about restricted shares not
vested as of December 31, 1998.
Aggregate # of Market Value on
Name Restricted Shares Held December 31, 1998
____ ______________________ _________________
Robert E. Lowder 17,123 $ 205,476
P. L. McLeod, Jr 12,000 144,000
W. Flake Oakley, IV 11,200 134,400
Michelle Condon 6,000 72,000
(4) Represents options granted on January 15, 1997, based on 1996
performance. These options vest at the rate of 20% per year beginning
one year from the date of grant.
(5) Represents options granted January 2, 1998, based on 1997 performance.
These options vest at the rate of 20% per year beginning one year from
the date of the grant.
(6) Represents options awarded December 30, 1998, based on 1998 performance.
These options vest at the rate of 20% per year beginning one year from
the date of grant.
</FN>
</TABLE>
FOR A DISCUSSION OF CERTAIN COMPENSATION COMMITTEE INTERLOCKS, SEE
"COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION." SEE ALSO
"EXECUTIVE COMPENSATION COMMITTEE REPORT."
Options
The following table shows certain information respecting exercised and
unexercised options for Common Stock held by BancGroup executive officers at
December 31, 1998. Certain options have been granted pursuant to a vesting
schedule which only permits the holder to exercise options respecting 20% of
the shares for each year the holder is employed after the grant of options.
<TABLE>
Aggregated Option Exercises in Last Fiscal Year
and Fiscal Year-End Option Values(1)
<CAPTION>
Number of
Securities
Underlying Value of
Unexercised Unexercised In-
Options At the-Money Options
December 31, At December 31,
1998 1998(2)
_______________ __________________
Acquired on Value Exercisable/ Exercisable/
Name Exercise(#) Realized($)(1) Unexercisable Unexercisable
____ ___________ ______________ _______________ __________________
<S> <C> <C> <C> <C>
Robert E. Lowder _____ $ ____ 382,040/180,000 $3,835,383/$240,650
P. L. McLeod, Jr. _____ ____ 60,000/76,000 268,572/43,108
W. Flake Oakley, IV _____ ____ 40,000/72,000 188,732/43,108
Young J. Boozer, III 1,500 16,593 48,500/0 502,012/0
Michelle Condon _____ ____ 19,290/8,900 75,368/6,044
<FN>
(1) Value realized is the difference between the fair market value of the
securities underlying the options and the exercise price on the date of
exercise.
(2) Value is calculated by subtracting the exercise price from the market
value of underlying securities at December 31, 1998.
</FN
</TABLE>
The following table shows certain information respecting grants of
options respecting Common Stock to certain executive officers of BancGroup
during 1998.
<TABLE>
Option Grants in Last Fiscal Year (1)
<CAPTION>
Potential Realizable Value at Assumed Annual
Individual Grants Rates of Stock Price Appreciation for Option Term
_______________________ __________________________________________________________________________
Percent
Number of of Total
Securities Options
Underlying Granted to Exercise Market
Options Employees or Base Price on
Granted in Fiscal Price Date of Expiration
Name (#) Year ($/Sh) Grant Date 0%($) 5%($) 10%($)
____ __________ __________ ________ ________ _________________ ______ ________ __________
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Robert E. Lowder 100,000 5.47% $11.5313 * December 30, 2008 -0- $725,197 $1,837,792
P.L. ("Mac") McLeod, Jr. 40,000 2.19% $11.5313 * December 30, 2008 -0- 290,079 735,117
W. Flake Oakley, IV 40,000 2.19% $11.5313 * December 30, 2008 -0- 290,079 735,117
Michelle Condon 2,500 .14% $11.5313 * December 30, 2008 -0- 18,130 45,945
<FN>
* Same as exercise price
(1) Does not include 24,000 options granted to Mr. McLeod, 20,000 options
granted to Mr. Oakley, and 4,000 options granted to Ms. Condon on January
2, 1998, based on 1997 performance. The options granted on January 2, 1998
have been adjusted to reflect a two for one stock split in the form of
a dividend effective August 14, 1998. These options vest 20% per year
beginning one year from date of grant.
</FN>
</TABLE>
Defined Benefit Plan
BancGroup has adopted a Retirement Plan for all of the employees of
BancGroup and its subsidiaries. An employee becomes eligible on January 1 or
July 1 following age 21 and completion of 1,000 hours of service during a
year of employment by BancGroup or one of its subsidiaries.
The following table reflects the estimated annual benefits payable upon
retirement under the Retirement Plan as a single life annuity commencing at
age 65. These benefits ignore the lower benefit rate applicable to earnings
below the Social Security Covered Compensation level.
<TABLE>
Years of Service
<CAPTION>
Final Annual
Remuneration 5 10 15 20 25
____________ ________ ________ ________ ________ ________
<C> <C> <C> <C> <C> <C>
$ 100,000 $ 7,600 $ 15,200 $ 22,800 $ 30,400 $ 38,000
125,000 9,500 19,000 28,500 38,000 47,500
160,000 12,160 24,320 48,640 48,640 60,800
Over $160,000 -- Benefits are identical to benefits paid per $160,000
</TABLE>
Benefits are based upon the number of years of service (maximum 25
years), the participant's final earnings, and the amount of Social Security
Covered Compensation. A participant receives credit for a year of service for
every year in which 1,000 hours are completed in the employment of BancGroup
or one of its subsidiaries.
The benefits shown are limited by the current statutory limitations
which restrict the amount of benefits which can be paid from a qualified
retirement plan. The statutory limit on compensation which may be recognized
in calculating benefits is $160,000. This limitation is scheduled to increase
periodically with the cost of living increase.
All compensation, except compensation which relates to director fees, if
any, shown for executive officers in the cash compensation table above is
covered by the Retirement Plan. Robert E. Lowder has 34 years of eligibility,
P.L. McLeod, Jr. has 17 years, W. Flake Oakley has 11 years, Young J. Boozer,
III has 14 years, and Michelle M. Condon has 26 years.
Compensation Plans
Directors' Plan. BancGroup's Restricted Stock Plan for Directors (the
"Directors' Plan") provides a means whereby all directors of BancGroup and
its subsidiaries may receive shares of BancGroup Common Stock in lieu of cash
fees for service as directors.
Upon election as a director, each director may receive, at the option of
the director, in lieu of cash fees, that number of whole shares of Common
Stock of BancGroup, rounded to the nearest whole number, determined by
dividing the Regular Fees the director would have received during the
director's current term of office by the average of the closing prices of the
Common Stock as reported by the New York Stock Exchange for the period of 30
trading days prior to such election. "Regular Fees" means that amount of fees
payable to a director in cash, and without regard to attendance at meetings,
for a full term of office as a director.
A director may also elect to receive Common Stock at the end of the
term, based upon the amount of Supplemental Fees such director would have
been entitled to receive during such term and subject to certain restrictions
and risks of forfeiture, provided such director has waived the receipt of
Supplemental Fees at the commencement of such director's term. "Supplemental
Fees" means fees paid to a director for attendance at the committee meetings,
special meetings of the Board, or otherwise, and which are paid only on an ad
hoc basis. The number of shares to which the director is entitled shall be
calculated at the end of the director's term and shall be equal to that
number of whole shares of Common Stock, rounded to the nearest whole number,
determined by dividing the Supplemental Fees the director would have received
during the current term by the average of the closing prices of the Common
Stock for the period of 30 trading days prior to the election as a director
to such term.
Each director of BancGroup who participates in the Directors' Plan must
enter into a written agreement with BancGroup. Directors of BancGroup who
serve three-year terms may elect on an annual basis whether to participate in
the Directors' Plan for the following year commencing with the annual meeting
of stockholders, in which case the 30-day period used to determine price
expires prior to the annual meeting which commences the period of annual
participation. No director may receive more than 4,800 shares of Common Stock
during any one year, except for shares which may be received through stock
splits, stock dividends, or certain other events specified in the Directors'
Plan.
Directors to whom shares of Common Stock have been awarded in lieu of
Regular Fees under the Directors' Plan have all rights of shareholders with
respect to shares of Common Stock so awarded, subject to certain provisions
regarding forfeiture, which means, among other things, that directors may
receive dividends upon and vote the shares of Common Stock awarded in lieu of
Regular Fees.
Stock Option Plans. In 1992, BancGroup adopted incentive and
nonqualified stock option plans pursuant to which options for Common Stock
may be issued to officers, directors and employees. BancGroup may issue a
total of 7,400,000 shares of Common Stock under these plans. BancGroup's
former stock option plans expired in 1992, but options issued pursuant to
those plans remain outstanding.
Stock Bonus Plan. BancGroup also adopted in 1992 a Stock Bonus and
Retention Plan pursuant to which 3,000,000 shares of Common Stock may be
issued.
Director Compensation. Directors of BancGroup receive fees of $500 per
month, plus $750 for each Board meeting attended. Members of committees
receive fees of $350 for each committee meeting attended. Certain directors
of BancGroup also serve as directors of Colonial Bank or its regional boards
and receive fees that are comparable to those paid by BancGroup. In
addition, directors of BancGroup are allowed to receive BancGroup Common
Stock in lieu of cash compensation as directors pursuant to the
Directors' Plan. Fees paid to BancGroup directors in cash for 1998 totaled
$160,778. In 1998, a total of 16,255 shares of Common Stock were earned
and 21,172 shares were issued under the Directors' Plan to BancGroup
directors for service as directors of BancGroup and its subsidiaries.
John C.H. Miller, Jr., Clinton O. Holdbrooks, Patrick F. Dye, John Ed
Mathison and James L. Hewitt received employment-related compensation during
1998 of $41,000, $1,200, $3,000, $18,000 and $219,538, respectively. Mr.
Miller provides advice to BancGroup management and to the Colonial Bank-Gulf
Coast Region that extends beyond legal work for which Mr. Miller's law firm
receives legal fees. Mr. Holdbrooks, Mr. Dye, and Dr. Mathison perform
consulting, public relations and/or customer development services for either
BancGroup, Colonial Bank or both. Mr. Hewitt serves as Chairman of Colonial
Bank's Central Florida Region Board of Directors.
EXECUTIVE COMPENSATION COMMITTEE REPORT
The Personnel and Compensation Committee of BancGroup (the "Committee")
consists of John C.H. Miller, Jr., Chairman, Milton E. McGregor, Joe D.
Mussafer, John Ed Mathison, Frances E. Roper, and Simuel Sippial. The
Committee reviews and determines cash compensation as it relates to officers
of BancGroup, other than BancGroup's executive officers. However, the Board
has established a subcommittee of the Committee (the "Subcommittee"),
consisting of Joe D. Mussafer, Frances E. Roper, and Simuel Sippial, to
determine all cash compensation for executive officers of BancGroup. The
Subcommittee also makes decisions regarding awards of Common Stock under
BancGroup's stock option and stock bonus plans, including awards made to
executive officers.
John C.H. Miller, Jr., and John Ed Mathison receive employment-related
compensation from BancGroup, and the law firm of which Mr. Miller is a
partner receives legal fees from BancGroup. See "Executive Compensation
Committee Interlocks and Insider Participation" and "Executive Compensation
- - Director Compensation."
Compensation Principles
The Subcommittee determines executive compensation in accordance with
five principles: (1) BancGroup's financial performance, both in terms of the
attainment of short-term and long-term goals; (2) the competitiveness of
executive compensation with BancGroup's peers; (3) the encouragement of stock
ownership by executive officers; (4) the individual performance of each
executive officer; and (5) recommendations of the Chief Executive Officer
regarding all executive officers other than himself. No disproportionate
weight is assigned to any individual principle.
Total Cash Compensation
Cash compensation consists of an annual salary established at the
beginning of the fiscal year and a year-end bonus described further below. In
setting compensation for the 1998 fiscal year, the Subcommittee reviewed the
compensation paid by a peer group of 48 bank holding companies which, as of
September 30, 1997, had total assets of between $3.0 and $10.0 billion, which
is a category designated by the Board of Governors of the Federal Reserve
System as Peer Group 2. A total of 62 bank holding companies were in this
category, but compensation information on 14 companies was not available. In
addition, Alabama's largest bank holding companies, regardless of asset size,
were included in the peer-group because of their direct in-state competition
with BancGroup. Prior to restatement for 1998 pooling-of-interest business
combinations, BancGroup had total assets of $6.85 billion at year-end 1997.
Salaries of the executive officers of BancGroup for 1998 were determined
by the Subcommittee in mid-January, 1998. The salaries paid to executive
officers in the peer group companies were analyzed in terms of (1) return on
average assets, (2) return on average equity, (3) nonperforming assets, and
(4) stock performance within ranges comparable to the same performance
criteria for BancGroup. These criteria reflect how well the executives
perform for the benefit of stockholders and provide a range of performance
comparable to the performance of BancGroup.
The Subcommittee accorded equal weight to the performance criteria in
assessing the performance of BancGroup and in making the comparisons with the
peer group. The Subcommittee did not recommend compensation levels based upon
a formula, but, rather, after reviewing the factors outlined above and
receiving recommendations of the Chief Executive Officer for each person
reviewed other than the Chief Executive Officer, the Subcommittee established
salaries for 1998 that, in its subjective judgment, were fair in terms of
BancGroup's performance in comparison with the peer group, the
responsibilities performed by the executive within BancGroup and the level of
compensation paid to comparable executives in the peer group companies.
Compensation for Chief Executive Officer
The Subcommittee evaluated the salary of the Chief Executive Officer on
the basis of the same criteria used to evaluate salaries of other executive
officers. The Subcommittee's determination of an appropriate level of
compensation for the Chief Executive Officer was thus based on a comparison
of BancGroup's performance with the performance of the peer group, the Chief
Executive Officer's responsibilities within BancGroup, and the compensation
paid to chief executive officers within the peer group. The Subcommittee
recommended that Mr. Lowder's salary for 1998 be set at $850,000.
Stock Bonuses
In December 1998, BancGroup stock options were awarded under BancGroup's
Incentive Stock Option Plan as follows: 40,000 options to Mr. McLeod,
40,000 options to Mr. Oakley, and 2,500 options to Ms. Condon. Mr. Lowder
was awarded 100,000 options under BancGroup's Non-Qualified Stock Option
Plan. In each case the options vest at the rate of 20% per year for each
year the employee is employed from the date of grant. With respect to awards
issued to executive officers other than Mr. Lowder, the Subcommittee
considered the recommendation of the Chief Executive Officer and other
objective and subjective criteria, including BancGroup's financial
performance in the preceding year, the perceived responsibility of each
executive officer for that performance and the appropriateness of each award
in light of general market conditions and peer group competition.
This foregoing report is submitted by the Subcommittee.
Subcommittee:
Joe D. Mussafer
Frances E. Roper
Simuel Sippial
<TABLE>
COMPARE 5-YEAR CUMULATIVE TOTAL RETURN
AMONG COLONIAL BANCGROUP, INC.,
S&P 500 INDEX AND S&P GROUP INDEX
<CAPTION>
Measurement Period Colonial
(Fiscal Year Covered) BancGroup, Inc. S&P Group S&P 500 Index
_____________________ _______________ _________ _____________
<C> <C> <C> <C>
1993 100.00 100.00 100.00
1994 109.33 94.65 101.32
1995 184.81 149.04 139.40
1996 236.64 203.64 171.41
1997 417.45 306.21 228.59
1998 297.35 338.32 293.92
</TABLE>
Neither the foregoing graph nor the Executive Compensation Committee
Report given above is to be deemed to be incorporated by reference into any
past or subsequent filings by BancGroup under the Securities Act of 1933 or
the Securities Exchange Act of 1934.
RELATIONSHIP WITH INDEPENDENT PUBLIC ACCOUNTANT
BancGroup has selected the firm of PricewaterhouseCoopers LLP to act as
independent public accountant for the current year. It is expected that
representatives of this firm will be present at the Annual Meeting and will
have an opportunity to make a statement to and to answer questions from
stockholders.
BYLAW PROVISIONS REGARDING CONDUCT OF STOCKHOLDERS' MEETINGS
BancGroup's bylaws contain two provisions relating to the conduct of
stockholders' meetings. The first provision requires that certain procedures
be followed by a stockholder of record who wishes to present business at the
annual meeting of stockholders, including the nomination of candidates for
election as directors. In order to nominate persons for election as a
director or to present other business at a meeting, a stockholder must
provide written notice thereof to the secretary of BancGroup not less than 60
days nor more than 90 days prior to the first anniversary of the preceding
year's annual meeting, provided that, if the date of the annual meeting is
advanced by more than 30 days or delayed by more than 60 days from such
anniversary date, notice by the stockholder to be timely must be delivered
not earlier than the 90th day prior to such annual meeting and not later than
the close of business on the later of the 60th day prior to such annual
meeting or the 10th day following the day on which public announcement of
the date of such meeting is first made.
As it relates to director nominations, the written notice must state all
information as to each nominee required to be disclosed in solicitations of
proxies for election of directors under SEC regulations, including the
written consent of each such nominee. As for any other business that the
stockholder proposes to bring before the meeting, the written notice must
contain a brief description of the business, the reasons for conducting the
business at the meeting and any material interest in such business of such
stockholder. The notice must also contain the name and address of such
stockholder and the class and number of shares of BancGroup owned
beneficially and of record, as well as the same information for each
beneficial owner who may be nominated for election as a director.
The Board is not required to nominate a person designated by a
stockholder or to take up such other business as may be contained in a
written notice from a stockholder; however, compliance with this procedure
would permit a stockholder to nominate the individual at the stockholders
meeting, and any stockholder may vote shares in person or by proxy for any
individual such stockholder desires. The procedures relating to nominating
directors and presenting other business at a stockholders meeting may only be
used by a stockholder who is a stockholder of record at the time of the
giving of the notice by the stockholder to the secretary of BancGroup. The
procedures do not prohibit or apply to stockholder proposals under SEC rule
14a-8 as described at "Proposals of Stockholders."
The second provision of BancGroup's bylaws relates to the conduct of the
business at a stockholder meeting. Under that provision, the Board has the
authority to adopt rules for the conduct of meetings, and, unless
inconsistent with any such rules, the Chairman of the meeting may prescribe
such rules, regulations and procedures as, in his judgment, are appropriate
for the proper conduct of the meeting.
PROPOSALS OF STOCKHOLDERS
Subject to certain rules of the Securities and Exchange Commission,
proposals by stockholders intended to be presented at BancGroup's 2000
annual meeting of stockholders must be received at BancGroup's principal
executive offices not less than 120 calendar days in advance of March 17,
2000, for inclusion in the proxy or information statement relating to the
2000 annual meeting.
OTHER MATTERS
BancGroup does not know of any matters to be presented for action at the
meeting other than those listed in the notice of the meeting and referred to
herein.
BancGroup will furnish without charge to its stockholders, upon written
request, a copy of its annual report on Form 10-K, including the accompanying
financial statements and schedules, required to be filed with the SEC for the
year ended December 31, 1998. Copies of the exhibits to such report will also
be available upon payment of a reasonable fee for copying charges. Requests
should be made to:
Chief Financial Officer, Treasurer and Secretary
The Colonial BancGroup, Inc.
Post Office Box 1108
Montgomery, Alabama 36101.
PLEASE SIGN AND DATE THE ENCLOSED PROXY CARD AND RETURN IT IN THE
ACCOMPANYING ENVELOPE AS PROMPTLY AS POSSIBLE.
YOU MAY REVOKE THE PROXY BY GIVING WRITTEN NOTICE OF REVOCATION TO THE
SECRETARY OF BANCGROUP AT ANY TIME PRIOR TO THE VOTING THEREOF, BY EXECUTING
AND SUBMITTING A LATER DATED PROXY, OR BY ATTENDING THE MEETING AND VOTING IN
PERSON.
<PAGE>
<PROXY CARD>
SOLICITED BY THE BOARD OF DIRECTORS
PROXY
Common Stock
The Colonial BancGroup, Inc.
Annual Meeting of Stockholders
April 21, 1999
The undersigned hereby appoints Robert E. Lowder and William E. Powell,
III, and either of them, or such other persons as the Board of Directors of
The Colonial BancGroup, Inc. ("BancGroup"), may designate, proxies for the
undersigned, with full power of substitution, to represent the undersigned
and to vote all of the shares of common stock, par value $2.50, of BancGroup
(the "Common Stock") which the undersigned would be entitled to vote at the
annual meeting of stockholders to be held on April 21, 1999, and at any and
all adjournments thereof.
1. Election of Directors:
NOMINEES FOR A TERM EXPIRING IN 2002: William Britton, Patrick F.
Dye, Milton E. McGregor, Jack H. Rainer and Simuel Sippial
[ ] FOR all nominees listed except [ ] WITHHOLD AUTHORITY to vote
as marked to the contrary for all nominees
INSTRUCTIONS: TO WITHHOLD AUTHORITY TO VOTE FOR ANY INDIVIDUAL,
STRIKE A LINE THROUGH THE NOMINEE'S NAME IN THE ABOVE LIST.
2. In their discretion, to vote on such other matters as may properly
come before the meeting, but which are not now anticipated, to vote
for the election of any person as a director should any person
named in the proxy statement to be elected be unable to serve or
for good cause cannot serve, and to vote upon matters incident to
the conduct of the meeting.
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS AND WILL BE
VOTED AS DIRECTED HEREIN. IF NO DIRECTION IS GIVEN, THIS PROXY WILL BE VOTED
FOR THE PERSONS NAMED IN PROPOSAL 1, AND IN ACCORDANCE WITH THE DISCRETION OF
THE PROXY HOLDERS RESPECTING PROPOSAL 2.
Please sign and date this proxy.
Dated:________________________________, 1999
Phone No.___________________________________
____________________________________________
(Signature of Stockholder)
____________________________________________
(Signature of Stockholder, if more than one)
Please sign exactly as your name appears on
this card. Agents, executors, administrators,
guardians, and trustees must give full title
as such. Corporations should sign by their
President or authorized officer.
</PROXY CARD>
