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. )
Filed by the Registrant [X]
Filed by a Party other than the Registrant [ ]
Check the appropriate box:
[ ] Preliminary Proxy Statement
[ ] Confidential, for Use of the Commission Only (as permitted by Rule 14a-6(e)(2))
[X] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to Rule 14a-12
REGIONS FINANCIAL CORPORATION
--------------------------------------------------------------------------------
(Name of Registrant as Specified In Its Charter)
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(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:
(Regions Logo)
POST OFFICE BOX 10247
BIRMINGHAM, ALABAMA 35202-0247
TELEPHONE 205 944-1300
To the Stockholders:
You are cordially invited to attend the thirty-second annual meeting of the
stockholders of Regions Financial Corporation to be held at 10:00 a.m. local
time, on May 14, 2003, at the Regions Bank Operations Center, 201 Milan Parkway,
Birmingham, Alabama, 35209.
The formal notice of the annual meeting follows on the next page. Enclosed
with this proxy statement are your proxy card and a postage-paid envelope to
return your proxy card. We began mailing these materials to you on or about
April 16, 2003.
We hope you will plan to attend the stockholders' meeting. However, in
order that we may be assured of a quorum, we urge you to sign and return the
enclosed proxy in the postage-paid envelope provided, or otherwise vote your
shares by telephone or on the Internet as described in the proxy statement, as
promptly as possible, whether or not you plan to attend the meeting in person.
If you do attend the meeting, you may withdraw your proxy.
A reception and coffee will be held from 9:00 a.m. until 10:00 a.m., in the
Regions Bank Operations Center. We hope you will find it convenient to come
early enough to enjoy this social time prior to the stockholders' meeting.
/s/ Carl E. Jones, Jr.
Carl E. Jones, Jr.
Chairman of the Board
April 16, 2003
REGIONS FINANCIAL CORPORATION
POST OFFICE BOX 10247
BIRMINGHAM, ALABAMA 35202-0247
TELEPHONE 205 944-1300
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NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
To be held May 14, 2003
---------------------
NOTICE IS HEREBY GIVEN that the annual meeting of stockholders of Regions
Financial Corporation ("Regions"), a Delaware corporation, will be held at the
Regions Bank Operations Center, 201 Milan Parkway, Birmingham, Alabama 35209, on
Wednesday, May 14, 2003, at 10:00 a.m. local time, for the purpose of
considering and acting on the following:
1. To elect the four nominees for director named in the proxy
statement to serve for three year terms or until their successors
have been elected and qualified.
2. To ratify the audit committee's selection of Ernst & Young LLP as
independent auditors of Regions for the 2003 fiscal year.
3. To transact such other business as may properly come before the
meeting or any adjournment thereof.
Only stockholders of record at the close of business on April 4, 2003, are
entitled to receive 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 will be available for examination by any
stockholder, for any purpose relating to the meeting, during ordinary business
hours, for a period of at least 10 days prior to the meeting at the main office
of Regions Bank, 417 North 20th Street, Birmingham, Alabama. You are invited to
attend the meeting in person.
Please sign and date the enclosed proxy card and return it promptly in the
postage-paid envelope provided, whether or not you plan to attend the meeting in
person. In the alternative, you may vote your shares by telephone or the
Internet. Instructions are included with the proxy card. If you attend the
annual meeting, you may vote in person if you wish, even if you previously have
returned your proxy card or voted by telephone or on the Internet. You may
revoke your proxy at any time before it is voted at the annual meeting.
By Order of the Board of Directors
/s/ SAMUEL E. UPCHURCH, JR.
Samuel E. Upchurch, Jr.
Corporate Secretary
April 16, 2003
REGIONS FINANCIAL CORPORATION
POST OFFICE BOX 10247
BIRMINGHAM, ALABAMA 35202-0247
TELEPHONE 205 944-1300
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PROXY STATEMENT
FOR 2003 ANNUAL MEETING OF STOCKHOLDERS
---------------------
Regions Financial Corporation ("Regions") is furnishing this proxy
statement to the stockholders in connection with the 2003 annual meeting of
stockholders to be held on Wednesday, May 14, 2003, at 10:00 a.m. local time at
the Regions Bank Operations Center, 201 Milan Parkway, Birmingham, Alabama,
35209, and at any adjournment thereof. The matters to be considered and acted
upon are (1) the election of four nominees as directors of the corporation, (2)
the ratification of the audit committee's selection of Ernst & Young LLP as
independent auditors of Regions for the 2003 fiscal year, and (3) such other
business as may properly come before the meeting.
Your proxy is solicited on behalf of the board of directors of Regions. You
may revoke your proxy at any time before it is voted at the annual meeting. You
may submit your proxy by signing and dating the enclosed proxy card and
returning it in the envelope provided or by voting by telephone or on the
Internet by following the instructions provided in the proxy statement. All
properly submitted proxies delivered pursuant to this solicitation will be voted
at the meeting and in accordance with instructions, if any.
Participants in Regions' Dividend Reinvestment Plan and Directors' Stock
Investment Plan will note that shares held by the administrator for such plans
are shown on the enclosed proxy card in addition to shares held directly by the
stockholder in certificate form. Signing and returning the proxy card, or voting
by telephone or on the Internet, will enable voting of all shares, including
those held in such plans.
We are mailing to the stockholders entitled to vote at the annual meeting
this proxy statement, together with a proxy card, a postage-paid return
envelope, and the annual report of Regions Financial Corporation for the year
2002, including financial statements, starting on or about April 16, 2003.
The date of this proxy statement is April 16, 2003.
INFORMATION ABOUT REGIONS
Regions is a financial holding company headquartered in Birmingham, Alabama
which operates primarily within the southeastern United States. Regions'
operations consist of banking, brokerage and investment services, mortgage
banking, insurance brokerage, credit life insurance, commercial accounts
receivable factoring and specialty financing. At December 31, 2002, Regions had
total consolidated assets of approximately $47.9 billion, total consolidated
deposits of approximately $32.9 billion, and total consolidated stockholders'
equity of approximately $4.2 billion.
Regions is a Delaware corporation which began operations in 1971. Regions'
principal executive offices are located at 417 North 20th Street, Birmingham,
Alabama 35203, and its telephone number at such address is (205) 944-1300.
VOTING, REVOCABILITY AND SOLICITATION OF PROXIES
VOTING PROCEDURES AND REVOCATION
Stockholders may vote their shares in person at the annual meeting or by
submitting a proxy. Stockholders are urged to submit their proxies as promptly
as possible. A stockholder can submit a proxy by (1) signing and dating the
enclosed proxy card and returning it in the envelope provided; (2) calling the
toll-free telephone number provided below under "Electronic Voting
Instructions"; or (3) following the Internet voting instructions provided below
under "Electronic Voting Instructions." The telephone and Internet voting
procedures are designed to authenticate Regions stockholders' identities, to
allow Regions stockholders to give their voting instructions, and to confirm
that Regions stockholders' instructions have been recorded properly. Regions has
been advised by counsel that the procedures that have been put in place for
telephone and Internet voting are consistent with the requirements of applicable
law. Stockholders who wish to vote over the Internet should be aware that there
may be costs associated with electronic access, such as usage charges from
Internet access providers and telephone companies, and that there may be some
risk a stockholder's vote might not be properly recorded or counted because of
an unanticipated electronic malfunction.
Any Regions stockholder who has submitted a proxy may revoke it at any time
before it is voted by giving notice of revocation in writing or submitting to
Regions a later-dated proxy (including a telephone or Internet vote), provided
that such notice or proxy is actually received by Regions before the vote of
stockholders at the annual meeting. Any written notice of revocation should be
sent to Regions Financial Corporation, 417 North 20th Street, Birmingham,
Alabama 35203; Attention: Samuel E. Upchurch, Jr., Corporate Secretary. A proxy
will not be revoked by death or supervening incapacity of the stockholder
submitting the proxy unless, before the vote, notice of such death or incapacity
is filed with the Corporate Secretary.
The shares of Regions common stock represented by properly submitted
proxies received at or prior to the annual meeting and not subsequently revoked
will be voted as directed in such proxies. If instructions are not given, shares
represented by proxy will be voted for the election of the four nominees for
director named in this proxy statement, for the ratification of the audit
committee's selection of Ernst & Young LLP as independent auditors of Regions
for the 2003 fiscal year, and in the discretion of the proxy holder as to any
other matters that properly may come before the annual meeting. If necessary,
and unless contrary instructions are given, the proxy holder also may vote in
favor of a proposal to adjourn the annual meeting to permit further solicitation
of proxies in order to obtain sufficient votes to approve the matters presented
or any other matter that properly comes before the annual meeting. Proxies
representing shares which were voted against any of the matters presented will
not be voted in favor of any proposal to adjourn the annual meeting.
QUORUM REQUIREMENT
A quorum is necessary to hold a valid meeting. If holders of a majority of
all the shares of common stock entitled to vote at the meeting are present in
person or by proxy, a quorum will exist. If you submit a valid proxy, whether by
telephone, Internet or proxy card, or attend the meeting in person, your shares
of common stock will be counted for the purpose of determining whether there is
a quorum, even if you abstain from
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voting on some or all matters introduced at the meeting. Like abstentions,
broker non-votes will be counted as present for establishing a quorum. A broker
non-vote occurs when a broker votes on some matter on the proxy card but not on
others because the broker does not have the authority to do so or chooses not to
exercise its discretion.
INFORMATION ABOUT VOTES NECESSARY FOR ACTION TO BE TAKEN
The four nominees for director to be elected at the annual meeting will be
elected at the meeting by a plurality of all the votes cast at the meeting,
meaning that the four nominees for director with the most votes will be elected.
Regions' certificate of incorporation does not authorize cumulative voting in
the election of directors.
The appointment of Ernst & Young LLP as independent auditors of Regions for
the 2003 fiscal year will be ratified if a majority of the votes cast are voted
in favor of the appointment.
Abstentions and broker non-votes will have no effect on the vote on the
election of directors or the ratification of the appointment of Ernst & Young
LLP as independent auditors of Regions for the 2003 fiscal year.
ELECTRONIC VOTING INSTRUCTIONS
The deadline for voting by telephone or over the Internet is 11:59 p.m.,
eastern daylight time, on May 13, 2003. Voting electronically will not affect
your right to vote in person should you decide to attend the annual meeting.
Please note that the procedures for voting by telephone or over the Internet
differ depending on whether Regions shares are held in your own name or are held
for you in "street name" in a nominee or brokerage account.
For Regions shares held in your name: Any Regions stockholder of record
desiring to vote by telephone or over the Internet will be required to enter the
unique control number imprinted on such holder's Regions proxy card, and
therefore should have the proxy card in hand when initiating the session.
- To vote by telephone, dial 1-877-PRX-VOTE (1-877-779-8683) on a touch
tone telephone, and follow the simple menu instructions provided. There
is no charge for this call.
- To vote over the Internet, log on to the website
http://www.eproxyvote.com/rgbk and follow the simple instructions
provided. Similar instructions are included on the enclosed Regions proxy
card.
For Regions shares held in "street name": A number of brokerage firms and
banks are participating in a program provided through ADP Investor Communication
Services that offers telephone and Internet voting options. This program is
different than the program for shares registered in the name of the stockholder.
If your shares are held in an account at a brokerage firm or bank participating
in the ADP program, you may vote those shares electronically by following the
instructions provided by your brokerage firm or bank.
SOLICITATION OF PROXIES
The cost of solicitation of proxies will be borne by Regions. Regions will
solicit proxies by mail and also may solicit proxies by telephone or telegram or
in person by the directors, officers, and employees of Regions, who will receive
no additional compensation for such solicitation but may be reimbursed for
out-of-pocket expenses. Brokerage houses, nominees, fiduciaries, and other
custodians will be requested to forward solicitation materials to beneficial
owners and will be reimbursed for their out-of-pocket expenses. Regions has
retained D.F. King & Co., Inc. to assist in the solicitation of proxies. To the
extent necessary to insure a quorum, D.F. King & Co., Inc. is expected to
communicate in person, or by telephone, telegraph, telecopy, facsimile, or mail
with those stockholders who have not responded within a reasonable time to urge
them to return their proxies. It is anticipated that the fee of such firm will
not exceed $7,000 plus reasonable out-of-pocket costs and expenses authorized by
Regions.
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VOTING SECURITIES AND PRINCIPAL HOLDERS THEREOF
As of April 4, 2003, Regions had issued 221,935,529 shares of common stock,
all of which were outstanding and none of which were held as treasury stock.
Stockholders are entitled to one vote for each share on all matters to come
before the meeting. Only stockholders of record at the close of business on
April 4, 2003, will be entitled to vote at the meeting or any adjournment
thereof.
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS
As of December 31, 2002, all Regions' affiliate banks beneficially held in
a fiduciary capacity for others under numerous trust relationships, 10,445,969
shares or 4.7% of Regions' outstanding common stock. Regions' affiliate bank
trust departments have sole voting power with respect to 9,809,887 of these
shares or 4.4%, shared voting power with respect to 94,350 of these shares, sole
dispositive power with respect to 3,084,850 of these shares and shared
dispositive power with respect to 2,222,890 of these shares. No entity is known
to Regions to be the beneficial owner of more than five percent of any class of
voting securities.
SECURITY OWNERSHIP OF DIRECTORS AND MANAGEMENT
The following table presents information about beneficial ownership of
Regions common stock by the directors and certain executive officers of Regions
as of the record date. Unless otherwise indicated, each person has sole voting
and investment powers over the indicated shares. A person is deemed to be a
beneficial owner of any security of which that person has the right to acquire
beneficial ownership within 60 days from the record date. The footnotes to the
table indicate how many shares each person has the right to acquire within 60
days of the record date. The shares of Regions common stock which are issuable
to a person listed
4
below upon exercise of the vested portion of the outstanding options are assumed
to be outstanding for the purpose of determining the percentage of shares
beneficially owned by that person.
AMOUNT AND NATURE OF BENEFICIAL
OWNERSHIP AS OF APRIL 4, 2003
-------------------------------
NAME OF BENEFICIAL OWNER/NUMBER IN GROUP NO. OF SHARES % OF CLASS
---------------------------------------- ------------- ----------
DIRECTORS INCLUDING NOMINEES FOR DIRECTOR
Sheila S. Blair............................................. 125,696(1) *
James B. Boone, Jr. ........................................ 34,984(2) *
James S.M. French........................................... 126,768(3) *
Margaret H. Greene.......................................... 0(4) *
Richard D. Horsley.......................................... 637,927(5) *
Carl E. Jones, Jr. ......................................... 706,161(6) *
Susan Matlock............................................... 6,061(7) *
Allen B. Morgan, Jr. ....................................... 3,434,325(8) 1.5%
Jon W. Rotenstreich......................................... 0(9) *
Henry E. Simpson............................................ 197,804(10) *
W. Woodrow Stewart.......................................... 10,481(11) *
John H. Watson.............................................. 185,532(12) *
C. Kemmons Wilson, Jr. ..................................... 184,270(13) *
Harry W. Witt............................................... 0(14) *
OTHER NAMED EXECUTIVE OFFICERS (SEE SUMMARY COMPENSATION
TABLE)
John I. Fleischauer, Jr..................................... 210,492(15) *
Peter D. Miller............................................. 471,402(16) *
DIRECTORS AND EXECUTIVE OFFICERS AS A GROUP
23 PERSONS................................................ 7,622,921 3.4%
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* Less than 1%.
(1) Excludes 795 shares allocated to Ms. Blair under Regions' Directors'
Deferred Stock Investment Plan; includes 17,048 shares held by Ms. Blair's
spouse.
(2) Excludes 11,027 shares allocated to Mr. Boone under Regions' Directors'
Deferred Stock Investment Plan; includes 18,733 shares held by a charitable
foundation trust which is affiliated with Mr. Boone.
(3) Excludes 9,949 shares allocated to Mr. French under Regions' Directors'
Deferred Stock Investment Plan; includes 100,000 shares held by an
affiliate of Mr. French and 3,696 shares held by Mr. French's spouse.
(4) Excludes 663 shares allocated to Ms. Greene under Regions' Directors'
Deferred Stock Investment Plan.
(5) Includes 49,300 shares of restricted stock issued under Regions' 1999 Long
Term Incentive Plan, 4,771 shares held in Regions' 401(k) plans, and
279,680 shares issuable upon the exercise of stock options which are
currently exercisable or exercisable within 60 days after April 4, 2003.
(6) Includes 133,000 shares of restricted stock issued under Regions' 1999 Long
Term Incentive Plan, 5,715 shares held in Regions' 401(k) plans, and
181,247 shares issuable upon the exercise of stock options which are
currently exercisable or exercisable within 60 days after April 4, 2003;
also includes 37,128 shares held by Mr. Jones' spouse.
(7) Excludes 558 shares allocated to Ms. Matlock under Regions' Directors'
Deferred Stock Investment Plan.
(8) Includes 10,000 shares of restricted stock issued under Regions' 1999 Long
Term Incentive Plan and 83,332 shares issuable upon the exercise of stock
options which are currently exercisable or exercisable
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within 60 days after April 4, 2003; also includes 267,995 shares held by
Mr. Morgan's spouse, children, and a trust for Mr. Morgan's children.
(9) Excludes 1,134 shares allocated to Mr. Rotenstreich under Regions'
Directors' Deferred Stock Investment Plan.
(10) Excludes 9,569 shares allocated to Mr. Simpson under Regions' Directors'
Deferred Stock Investment Plan; includes 57,523 shares held by two estates
of which Mr. Simpson is a beneficiary.
(11) Excludes 6,070 shares allocated to Mr. Stewart under Regions' Directors'
Deferred Stock Investment Plan.
(12) Excludes 5,976 shares allocated to Mr. Watson under Regions' Directors'
Deferred Stock Investment Plan; includes 18,778 shares held by a charitable
foundation which is affiliated with Mr. Watson.
(13) Excludes 6,385 shares allocated to Mr. Wilson under Regions' Directors'
Deferred Stock Investment Plan.
(14) Excludes 1,134 shares allocated to Mr. Witt under Regions' Directors'
Deferred Stock Investment Plan.
(15) Includes 49,300 shares of restricted stock issued under Regions' 1999 Long
Term Incentive Plan, 2,400 shares held in Regions' 401(k) plans, and
133,804 shares issuable upon the exercise of stock options which are
currently exercisable or exercisable within 60 days after April 4, 2003.
(16) Includes 49,300 shares of restricted stock issued under Regions' 1999 Long
Term Incentive Plan, 2,535 shares held in Regions' 401(k) plans, and
254,466 shares issuable upon the exercise of stock options which are
currently exercisable or exercisable within 60 days after April 4, 2003;
also includes 58,838 shares held by affiliates of Mr. Miller and 13,851
shares held by Mr. Miller's spouse.
No change in control of Regions has occurred since January 1, 2002, and no
arrangements are known to Regions which may at a later date result in a change
in control of Regions.
SECTION 16(A) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
Section 16(a) of the Securities Exchange Act of 1934 requires Regions'
executive officers and directors to file reports of ownership and changes in
ownership of Regions' stock with the Securities and Exchange Commission.
Executive officers and directors are required by SEC regulations to furnish
Regions with copies of all Section 16(a) forms they file.
Based on a review of the forms filed during 2002, Regions believes that its
executive officers and directors complied with all applicable filing
requirements.
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ELECTION OF DIRECTORS
Regions recommends the election of James B. Boone, Jr., James S. M. French,
Richard D. Horsley, and W. Woodrow Stewart as directors, to hold office for a
term of three years expiring with the annual meeting of stockholders to be held
in 2006 or until their successors are elected and qualified. The proxy will be
voted FOR the nominees, unless otherwise directed. If any nominee is not
available for election, the proxies will be voted for such substitute nominee as
the board of directors may designate. Regions has no reason to believe that any
substitute nominee or nominees will be required. The proxies will not be voted
for more than four nominees.
INFORMATION ON DIRECTORS
The following table indicates the age, residence, principal occupation or
employment for the last five years of each nominee and each director whose term
of office continues after the meeting, the position and offices held with
Regions or its subsidiaries, the year the director was first elected, and the
year the director's term of office will expire.
YEAR
PRESENT OCCUPATION POSITION AND YEAR TERM OF
NAME OF NOMINEE AND PRINCIPAL OFFICES HELD WITH FIRST OFFICE
OR DIRECTOR, OCCUPATION FOR REGIONS AND ELECTED WILL
RESIDENCE, AND AGE LAST FIVE YEARS SUBSIDIARIES AS DIRECTOR EXPIRE
------------------ ------------------------------ ------------------------------ ----------- -------
James B. Boone, Jr.(1) Chairman of the Board, Boone Director, Regions 1985 2003
Tuscaloosa, Newspapers, Inc. (Newspaper
Alabama publishing, management and
67 ownership)
James S.M. French(1) Chairman and President, Dunn Director, Regions 1986 2003
Birmingham, Investment Co. (Construction,
Alabama construction materials,
63 investments)
Margaret H. Greene President, Regulatory and Director, Regions 2002 2004
Atlanta, External Affairs, BellSouth
Georgia Corporation
51 (Telecommunications)
Richard D. Horsley(1) Vice Chairman of the Board and Director, Regions; Director 1982 2003
Birmingham, Chief Operating Officer, Regions Bank, Regions Agency,
Alabama Regions and Regions Bank Inc., Regions Mortgage, Inc.,
60 Regions Life Insurance Company
and EFC Holdings Corporation
Carl E. Jones, Jr. Chairman, President and Chief Director, Regions; Director 1997 2004
Birmingham, Executive Officer, Regions and Regions Bank, Regions Mortgage
Alabama Regions Bank, formerly Inc., Regions Interstate
62 Regional President, Regions Billing Service, Inc., and EFC
Holdings Corporation
Susan Matlock President, Birmingham Director, Regions 2002 2004
Birmingham, Entrepreneurial Center,
Alabama executive director for office
56 of developing industries,
University of Alabama at
Birmingham (Higher education,
small business incubation)
Allen B. Morgan, Jr. Chairman and Chief Executive Chairman and Chief Executive 2001 2005
Memphis, Officer, Morgan Keegan, Inc. Officer, Morgan Keegan &
Tennessee and Morgan Keegan & Company, Company, Inc., Director,
60 Inc. Regions
Jon W. Rotenstreich Jon Rotenstreich Consultants, Director, Regions 2002 2005
New York, New York formerly TIG Holdings, Inc.
59 (Financial consulting)
W. Woodrow Stewart(1) Attorney, Stewart, Melvin & Director, Regions 1999 2003
Gainesville, Georgia Frost, LLP
64
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YEAR
PRESENT OCCUPATION POSITION AND YEAR TERM OF
NAME OF NOMINEE AND PRINCIPAL OFFICES HELD WITH FIRST OFFICE
OR DIRECTOR, OCCUPATION FOR REGIONS AND ELECTED WILL
RESIDENCE, AND AGE LAST FIVE YEARS SUBSIDIARIES AS DIRECTOR EXPIRE
------------------ ------------------------------ ------------------------------ ----------- -------
John H. Watson Chairman, Smith, Inc. (Heating Director, Regions 1999 2004
Dothan, Alabama and air conditioning)
65
C. Kemmons Wilson, Jr. Principal, Kemmons Wilson, Director, Regions 1999 2005
Memphis, Tennessee Inc. (Real estate development,
56 hotels, private investments)
Harry W. Witt Retired, Deloitte & Touche Director, Regions 2002 2005
Naples, Florida (Certified public accounting)
63
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(1) Nominee for election at 2003 stockholders' meeting.
Of the directors or nominees for director, none is a "control person" of
Regions by virtue of stock ownership. The only persons who might be considered
"control persons" of Regions are Carl E. Jones, Jr., Chairman, President and
Chief Executive Officer and Richard D. Horsley, Vice Chairman and Chief
Operating Officer, who gain any control they may exercise by virtue of office.
Of the nominees and directors listed above, one also serves as a director
of other companies with a class of securities registered under the Securities
Exchange Act of 1934. James S. M. French serves as a director of Energen
Corporation, Hilb, Rogal and Hamilton Company, and Protective Life Corporation.
THE BOARD AND COMMITTEES OF THE BOARD
Regions held six directors' meetings during 2002. All directors attended at
least 75% of the aggregate of the meetings held by the board and by committees
of which they were members. Among other board committees, Regions has an audit
committee, a compensation committee, and a nominating and corporate governance
committee that meet as needed.
Audit Committee. The audit committee, which held six meetings in 2002,
consists of Sheila S. Blair, Jon W. Rotenstreich, Harry W. Witt, and W. Woodrow
Stewart. Committee members satisfy the independence requirements of both the New
York Stock Exchange listing criteria and Regions' audit committee charter.
Duties of the committee include reviewing with Regions' independent auditors,
Ernst & Young LLP, the planning and results of the auditing engagement,
reviewing the activities and recommendations of Regions' internal auditors, and
reviewing the adequacy of internal accounting controls. Additional information
regarding the functions performed by the committee and its membership is set
forth in the "Audit Committee Report," included immediately below, and in the
audit committee charter, attached as Appendix A.
In January 2003, the audit committee adopted certain amendments to the
audit committee charter, and the board of directors has ratified and adopted the
amended audit committee charter. The amended and restated audit committee
charter is attached as Appendix A.
AUDIT COMMITTEE REPORT
Regions' audited financial statements at and for the three year period
ended December 31, 2002, are included in Regions Annual Report on Form 10-K for
the 2002 fiscal year. Regions, acting through its management and board of
directors, has the primary responsibility for the financial statements and the
reporting process, including the systems of internal accounting controls. Ernst
& Young LLP, independent auditors engaged by Regions, are responsible for
expressing an opinion on the conformity of those audited financial statements
with accounting principles generally accepted in the United States.
The audit committee oversees Regions' financial reporting process on behalf
of the board of directors. In fulfilling its oversight responsibilities, the
committee has reviewed the audited financial statements with Regions'
management, including a discussion of the quality, not just the acceptability,
of the accounting
8
principles, the reasonableness of significant judgments, and the clarity of
disclosures in the financial statements.
The audit committee has reviewed with Ernst & Young LLP their judgments as
to the quality, not just the acceptability, of Regions' accounting principles
and such other matters as are required to be discussed with the committee under
auditing standards generally accepted in the United States, including the
matters required to be discussed by Statement on Auditing Standards No. 61,
Communication with Audit Committees, as amended by Statement on Auditing
Standards No. 89, Audit Adjustments and Statement on Auditing Standards No. 90,
Audit Committee Communications.
The audit committee has discussed with Ernst & Young LLP their independence
in relation to Regions and Regions' management, including the matters addressed
in the written disclosures provided to Regions by Ernst & Young, as required by
Standard No. 1, Independence Discussions with Audit Committees, of the
Independence Standards Board, the standard-setting body governing the
independence of auditors in relation to their public company clients.
The audit committee has discussed with Regions' internal auditors and Ernst
& Young LLP the overall scope and plans for their respective audits. The
committee regularly meets with Regions' internal auditors and Ernst & Young,
with and without management present, to discuss the results of their
examinations, their evaluations of Regions' internal accounting and financial
reporting controls, and the overall quality of Regions' financial reporting.
In reliance on the reviews and discussions referred to above, the audit
committee recommended to the board of directors that the audited financial
statements be included in the Annual Report on Form 10-K for the year ended
December 31, 2002 for filing with the Securities and Exchange Commission.
The foregoing report of the audit committee is furnished by:
Sheila S. Blair, committee chair
Jon W. Rotenstreich
W. Woodrow Stewart
Harry W. Witt
Compensation Committee. The compensation committee, which held five
meetings during 2002, consists of James S. M. French, Susan Matlock, and C.
Kemmons Wilson, Jr.
The role of the compensation committee is to establish and monitor
compensation issues within the broad area of human resources management. The
compensation committee exercises administrative responsibility in working with
Regions' management on the development and clarification of Regions'
compensation philosophy, articulating reasons behind design of Regions' pay and
benefits programs and their relationship to corporate objectives and competitive
practices.
The functions of the compensation committee are recommending to the board
the compensation arrangements for executive management, approving compensation
arrangements for senior company officers, making recommendations to the board
concerning compensation plans in which officers are eligible to participate and
recommending to the board the establishment of or changes in benefit plans in
which officers are eligible to participate, and recommending to the board the
establishment of or changes in benefit plans in which officers and employees
participate (including the authority to make amendments to tax-qualified plans
in which officers participate).
In discharging its responsibility, the compensation committee has, from
time to time, used the services of compensation consultants for guidance with
respect to competitive data and practices of other financial service
organizations.
Nominating and Corporate Governance Committee. The nominating and
corporate governance committee, which held five meetings during 2002, consists
of James B. Boone, Jr., James S. M. French, Susan Matlock, and C. Kemmons
Wilson, Jr. The role of the nominating and corporate governance committee is to
propose nominees for the Regions' board of directors including the current
nominees for election at the annual meeting. The committee also is responsible
for reviewing, revising and maintaining the corporate governance policies and
procedures of Regions. Nominations by stockholders are governed by Regions'
bylaws, and accordingly the nominating committee does not consider nominees
recommended by stockholders.
9
EXECUTIVE COMPENSATION AND OTHER TRANSACTIONS
The following table is a summary of certain information concerning the
compensation earned by Regions' chief executive officer and each of the other
four most highly compensated executive officers during the last three fiscal
years.
SUMMARY COMPENSATION TABLE
ANNUAL COMPENSATION LONG TERM COMPENSATION
---------------------------- ------------------------------
AWARDS PAYOUTS
-------------------- ------- ALL
RESTRICTED STOCK LTIP OTHER
NAME AND PRINCIPAL POSITION YEAR SALARY BONUS STOCK(1) OPTIONS PAYOUTS COMPENSATION
--------------------------- ---- -------- ---------- ---------- ------- ------- ------------
Carl E. Jones, Jr........................ 2002 $798,846 $1,212,000 $1,544,750 200,000 0 $ 182,405(2)
Chairman, President and 2001 750,000 871,875 1,532,500 200,000 0 168,375
Chief Executive Officer 2000 650,000 459,225 703,281 100,000 115,000 82,135
Richard D. Horsley....................... 2002 396,077 453,309 617,900 80,000 0 133,899(3)
Vice Chairman and 2001 357,000 375,388 558,100 80,000 0 130,525
Chief Operating Officer 2000 326,999 206,473 301,406 60,000 115,000 105,547
Allen B. Morgan, Jr.(4).................. 2002 130,000 1,370,000 0 0 0 2,500(5)
President and CEO, 2001 130,000 1,370,000 0 125,000 0 2,425
Morgan Keegan & Co.
John I. Fleischauer, Jr.................. 2002 362,887 346,188 617,900 80,000 0 50,840(6)
Regional President 2001 320,000 334,404 558,100 80,000 0 41,795
2000 302,702 127,000 301,406 60,000 0 18,591
Peter D. Miller.......................... 2002 349,077 345,669 617,900 80,000 0 49,612(7)
Regional President 2001 310,000 266,009 558,100 80,000 0 42,051
2000 280,000 135,303 301,406 60,000 230,000 17,143
---------------
(1) The terms of the restricted stock awards are determined by the compensation
committee. Under the terms of the currently outstanding restricted stock
awards, the named executive officer must remain employed with Regions for
the duration of the restrictive period at the same or higher level in order
for the shares to be released. During the restriction period, the named
executive officer is eligible to receive dividends and exercise voting
privileges on such restricted shares. If any of the restrictions are removed
at the discretion of the compensation committee, the named executive officer
will receive a stock certificate for some percentage or all of the awarded
restricted shares. The restricted shares are not transferable by the named
executive officer during the restriction period. The compensation committee
has the discretion to modify the terms of the restricted stock awards. The
restrictive period for the restricted stock is seven years from the date of
grant, but the restrictions will automatically lapse sooner if specified
performance criteria are met. The performance criteria relate to total
stockholder return objectives relative to a group of peer institutions. At
December 31, 2002, Mr. Jones had 117,500 shares of restricted stock with a
fair market value of $3.9 million, Mr. Horsley had 42,500 shares of
restricted stock with a fair market value of $1.4 million, Mr. Morgan had no
shares of restricted stock, Mr. Fleischauer had 42,500 shares of restricted
stock with a fair market value of $1.4 million, and Mr. Miller had 42,500
shares of restricted stock with a fair market value of $1.4 million.
(2) Includes $96,870 allocated to Mr. Jones in 2002 under the 401(k) plan;
$31,954 allocated to Mr. Jones in 2002 under the profit sharing plan; and
$53,581 representing the estimated term component of the premium paid and
the estimated interest cost to Regions in 2002 resulting from premium
payments for a life insurance benefit plan for Mr. Jones. This plan serves
as an offset to an existing supplemental retirement plan.
(3) Includes $45,534 allocated to Mr. Horsley in 2002 under the 401(k) plan;
$15,843 allocated to Mr. Horsley in 2002 under the profit sharing plan; and
$72,522 representing the estimated term component of the premium paid and
the estimated interest cost to Regions in 2002 resulting from premium
payments for a life insurance benefit plan for Mr. Horsley. This plan serves
as an offset to an existing supplemental retirement plan.
10
(4) Mr. Morgan became employed by Regions on March 30, 2001; all amounts were
accrued and paid after that date.
(5) Consists of $2,500 allocated to Mr. Morgan in 2002 under the 401(k) plan.
(6) Includes $36,325 allocated to Mr. Fleischauer in 2002 under the 401(k) plan
and $14,515 allocated to Mr. Fleischauer in 2002 under the profit sharing
plan.
(7) Includes $35,645 allocated to Mr. Miller in 2002 under the 401(k) plan and
$13,967 allocated to Mr. Miller in 2002 under the profit sharing plan.
STOCK OPTIONS
The following table presents information concerning individual grants of
options to purchase Regions' common stock made during 2002 to the named
executive officers.
OPTION GRANTS IN THE LAST FISCAL YEAR
NUMBER OF % OF TOTAL EXERCISE
SECURITIES UNDERLYING OPTIONS GRANTED PRICE GRANT DATE
NAME OPTIONS GRANTED(1) TO EMPLOYEES IN 2002 (PER SHARE) EXPIRATION DATE PRESENT VALUE(2)
---- --------------------- -------------------- ----------- --------------- ----------------
Carl E. Jones, Jr.... 200,000 5.26% $30.895 1/22/12 $831,900
Richard D. Horsley... 80,000 2.10 30.895 1/22/12 332,760
Allen B. Morgan,
Jr................. 0 0 -- -- --
John I. Fleischauer,
Jr................. 80,000 2.10 30.895 1/22/12 332,760
Peter D. Miller...... 80,000 2.10 30.895 1/22/12 332,760
---------------
(1) All options granted in 2002 become exercisable over a three year period,
with 50% exercisable after 12 months, 25% exercisable after 24 months, and
25% exercisable after 36 months, except that exercisability is delayed for
an additional 12 months to the extent the value of incentive stock options
(determined as of the date of grant) first exercisable in a calendar year
exceeds $100,000 as to any recipient.
(2) Based on the Black-Scholes option pricing model adapted for use in valuing
executive stock options. The actual value, if any, an executive may realize
depends on the excess of the stock price over the exercise price on the date
the option is exercised, so there is no assurance the value realized by an
executive will be at or near the value estimated by the Black-Scholes model.
The estimated values under that model are based on the assumptions of
expected stock price volatility of .218, risk-free rate of return of 2.7%,
dividend yield of 3.48% and expected time to exercise of 5 years.
The following table presents information concerning exercises of stock
options to purchase Regions' common stock during 2002 and the number and value
of unexercised options and stock appreciation rights (SAR) held by the named
executive officers.
AGGREGATED OPTION/SAR EXERCISES IN 2002 AND FISCAL YEAR-END OPTION/SAR VALUES
NUMBER OF SECURITIES VALUE OF UNEXERCISED
UNDERLYING UNEXERCISED IN-THE-MONEY
OPTIONS/SARS OPTIONS/SARS
AT 12-31-02 AT 12-31-02
SHARES ACQUIRED VALUE EXERCISABLE/ EXERCISABLE/
NAME ON EXERCISE REALIZED(1) UNEXERCISABLE(2) UNEXERCISABLE(2)
---- --------------- ----------- ---------------------- ---------------------
Carl E. Jones, Jr......... 15,941 $262,667 348,355 / 303,583 $2,856,755 / $989,420
Richard D. Horsley........ 19,898 366,475 253,406 / 120,000 2,450,241 / 415,400
Allen B. Morgan, Jr....... 0 0 41,667 / 83,333 189,585 / 379,165
John I. Fleischauer,
Jr...................... 60,000 880,719 73,804 / 120,000 218,200 / 415,400
Peter D. Miller........... 43,922 659,841 194,466 / 120,000 1,762,990 / 415,400
---------------
(1) Value realized is calculated based on the difference between the exercise
price per share and the average of the high and low reported sale price per
share on the date of exercise.
(2) None of the currently exercisable options were granted with tandem SARs.
11
LONG-TERM INCENTIVE PLAN AWARDS IN 2002
No performance shares were awarded to Regions' named executive officers in
2002. Information concerning restricted stock awards during 2002 is included in
the summary compensation table on page 10.
RETIREMENT PLANS
The named executive officers are covered by the Regions Financial
Corporation Retirement Plan, a qualified defined benefit retirement plan, as
complimented by retirement compensation agreements pursuant to its supplemental
executive retirement program.
The following table shows estimated annual benefits payable at retirement,
including both qualified plan benefits and supplemental benefits, based on
combinations of final compensation and age at retirement.
PENSION PLAN TABLE
AGE AT RETIREMENT
---------------------------------------------------------------
COMPENSATION 55 60 62 63 64 65
------------ -------- -------- -------- -------- -------- --------
$125,000........................... $ 50,000 $ 62,500 $ 67,500 $ 70,000 $ 72,500 $ 75,000
150,000........................... 60,000 75,000 81,000 84,000 87,000 90,000
175,000........................... 70,000 87,500 94,500 98,000 101,500 105,000
200,000........................... 80,000 100,000 108,000 112,000 116,000 120,000
250,000........................... 100,000 125,000 135,000 140,000 145,000 150,000
300,000........................... 120,000 150,000 162,000 168,000 174,000 180,000
350,000........................... 140,000 175,000 189,000 196,000 203,000 210,000
400,000........................... 160,000 200,000 216,000 224,000 232,000 240,000
450,000........................... 180,000 225,000 243,000 252,000 261,000 270,000
500,000........................... 200,000 250,000 270,000 280,000 290,000 300,000
550,000........................... 220,000 275,000 297,000 308,000 319,000 330,000
600,000........................... 240,000 300,000 324,000 336,000 348,000 360,000
650,000........................... 260,000 325,000 351,000 364,000 377,000 390,000
700,000........................... 280,000 350,000 378,000 392,000 406,000 420,000
750,000........................... 300,000 375,000 405,000 420,000 435,000 450,000
800,000........................... 320,000 400,000 432,000 448,000 464,000 480,000
Benefits are based on average compensation (limited to base salary) over
the three years prior to retirement. In 2002, compensation covered by the plans
for the five highest paid executive officers was as follows: Mr. Jones,
$798,846; Mr. Horsley, $396,077; Mr. Morgan, $130,000; Mr. Fleischauer,
$362,887; and Mr. Miller, $349,077, as reflected in the summary compensation
table on page 10. Benefits are payable as a single life annuity for single
participants and a joint and 50% survivor annuity for married participants.
Other forms of payment are available on an actuarially equivalent basis. Amounts
shown are subject to offset for company-sponsored long-term disability payments
and executive life insurance program cash values exceeding premiums paid.
Benefits are not offset by Social Security benefits. Benefits will be reduced or
eliminated if the participant terminates employment voluntarily before age 55.
CHANGE OF CONTROL AGREEMENTS
Certain executive officers of Regions, including the five executive
officers named in the summary compensation table, have change of control
agreements with Regions. The terms of the agreements, which are identical with
respect to all the signatories, are summarized as follows.
The change of control agreement provides to each signatory executive
officer certain protections in the event a "change of control" in Regions
occurs. For this purpose, the agreement defines "change of control" to
12
include, generally, the acquisition by any person or group of beneficial
ownership of more than 50% of the combined voting power of Regions; a change in
composition of the board of directors such that incumbent directors make up less
than a majority of the board; completion of a merger, consolidation, or
reorganization (subject to exceptions for certain noncontrol transactions); and
a liquidation or dissolution of Regions or sale of all or substantially all of
its assets.
Commencing on the date of a change of control and for the three year period
following, each signatory executive officer agrees to remain employed by
Regions, subject to the terms of the agreement, and to devote reasonable time
and attention and reasonable best efforts to perform the responsibilities of the
position. Regions agrees that the authority, duties, and responsibilities of
each signatory executive officer shall be at least commensurate with those in
effect prior to the change of control.
Also, during such three year period, the base salary of each signatory
executive officer may not be less than the base salary in effect prior to the
change of control, and the bonus may not be less than the highest bonus in the
preceding three years. Each signatory executive will be entitled to participate
in all incentive and retirement plans on terms comparable to other peer
executives, and to participate in all welfare benefit plans on comparable terms.
During such three year period following a change of control, Regions may
terminate the employment of a signatory executive officer with or without
"cause," which is defined generally as willfully failing to perform reasonably
assigned duties, or engaging in illegal conduct or gross misconduct that
materially injures Regions. The signatory executive officer may terminate
employment with or without "good reason," which includes a reduction of the
officer's compensation, benefits, duties or status, a forced relocation or
material increase in travel requirements or other material breach of the
agreement by Regions.
If Regions terminates the officer's employment other than for cause, or if
the officer resigns for good reason (including resignation for any reason during
the 30-day period following the first anniversary of a change of control),
Regions must pay the executive officer accrued compensation and benefits plus an
amount equal to three times the sum of his base salary and highest annual bonus
within the past three years, and Regions must continue to provide the officer or
his beneficiaries welfare benefits coverage for three years. If the executive
officer's employment is terminated by Regions for cause, or by reason of the
officer's death, disability, or resignation other than for good reason, Regions'
liability is limited to accrued compensation and benefits.
If any payment under the agreement causes the signatory executive officer
to become subject to the excise tax imposed under section 4999 of the Internal
Revenue Code, then Regions must make an additional payment sufficient to cover
such excise tax plus all income and excise tax imposed on such additional
payment.
DIRECTORS' COMPENSATION
In 2002, directors who are not employees of Regions or its subsidiaries
were paid an annual directors' fee retainer of $25,000, plus an additional
annual retainer of $4,000 for each committee of the board on which a director
serves, and an additional annual chairman's retainer of $2,000 for each
committee chairman. Directors who are employees of Regions or its subsidiaries
receive no fees for their services as directors.
Non-employee directors of Regions are eligible to participate in Regions'
directors' deferred stock investment plan, under which a participating director
may elect to defer receipt of some or all of the participant's retainer and
fees. Regions contributes 25% or the amount deferred by each participating
director. Deferred amounts and company contributions are credited to a
bookkeeping account for the director, which is designated in notional shares of
Regions common stock. Dividend equivalents, if any, are converted to additional
notional shares of common stock in the participant's account. At the end of the
deferral period, the participant's account is settled in actual shares of common
stock, plus cash for any fractional share. Receipt and taxability of benefits
are deferred until the later of the close of the year in which the participant
reaches age 65 or close of the year in which the participant terminates as a
director. During the deferral period, the
13
participants' deferrals and Regions' contributions are invested in Regions
common stock, which is maintained in a rabbi trust.
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION.
The directors who served on the compensation committee during all or part
of 2002 were:
Lee J. Styslinger, Jr., chairman (retired in May, 2002)
Sheila S. Blair (January - July, 2002)
C. Kemmons Wilson, Jr. (all of 2002)
James S.M. French, chairman (appointed in July, 2002)
Susan Matlock (appointed in October, 2002)
None of these committee members is or ever has been an officer or employee of
Regions or any of its subsidiaries.
REPORT OF THE COMPENSATION COMMITTEE
REGARDING EXECUTIVE COMPENSATION
The compensation committee of the board of directors of Regions is
responsible for developing the Regions executive compensation philosophy. It is
the duty of the compensation committee to administer the philosophy and its
relationship with the compensation paid to the chief executive officer and each
of the other senior executives. The committee focuses on ensuring there is a
strong link between the success of the stockholders and the rewards of the
executives.
General. Regions recognizes the importance of annual and long-term
incentive compensation plans to attract and retain corporate officers and other
key employees and to motivate such persons to perform to the best of their
abilities. Regions' annual and long-term incentive programs are designed to
encourage achievement of corporate, strategic business unit, and individual
performance levels that foster overall profitability and stockholder value.
Regions' executive compensation programs incorporate both qualitative and
quantitative considerations. The total compensation of the executive officers of
Regions can be divided into three components: annual base salary, annual
incentive compensation, and long-term incentive compensation. Annual base salary
is intended to be competitive with executive base compensation paid by other
similar financial institutions. Annual incentive compensation is tied
quantitatively to the achievement by Regions of pre-determined, objective
financial performance goals, measured over one-year periods. Long-term incentive
compensation is primarily represented by equity-based awards, designed to reward
the executives with incremental value commensurate with long-term increases in
the value of Regions common stock. The compensation decisions of the committee
relative to Regions' principal executive officers, including the five officers
named above in the compensation tables, are described below as to each of the
three categories. Executive officers' compensation for 2002 was determined by
the committee in the first quarter of 2002.
Base Salary. Annual base salaries are generally set at competitive levels
with similar financial institutions. Specifically the committee considers peer
group comparisons from survey data for other financial companies,
recommendations from an independent compensation consultant, and individual
performance assessments. For executives other than the chief executive officer,
the committee also considers the chief executive officer's recommendations. In
reaching a consensus on the base salary for each executive, the committee may or
may not assign weights to the various factors considered.
In evaluating and establishing the base salaries of the executive officers
for 2002, the committee, in conjunction with its independent compensation
consultant, surveyed the base salaries of the corresponding officers of other
bank holding companies in a survey group consisting of 11 companies closest to
Regions in asset size and deposit size, and also including the two other largest
bank holding companies headquartered in Alabama. The committee generally targets
the base salaries of the named executive officers to be commensurate in the
aggregate with the median of the base salaries of the corresponding executive
officers of the
14
companies in the survey group, but also factors in an inherently subjective
assessment of the comparative contributions of the executive personnel to
Regions' continued financial and operating success. Based on data as of March 1,
2002, the actual base salaries of Regions' named executive officers group in the
aggregate was slightly below median amounts indicated by the survey comparison.
The survey comparison group used in establishing salaries for 2002 was not
the same as the group of companies, that make up the S&P 500 Banks Index
presented in the Comparison of Five-Year Cumulative Total Return graph included
in this proxy statement. The committee believes the use of a smaller survey
group tailored by asset and deposit size is more valid for salary evaluation
purposes, even though not all the compensation survey companies are included in
the S&P 500 Banks Index, and even though many companies included in the S&P 500
Banks Index are not included in the compensation survey group.
Based on the survey comparison, advice of an independent compensation
consultant, recommendations from the chief executive officer (for officers other
than himself), and an inherently subjective assessment of the comparative
contributions of the executive personnel to Regions' continued financial and
operating success, the 2002 base salaries for the named officers were determined
by the committee.
Annual Incentive Compensation. In the first quarter of 2002, the
compensation committee approved Regions' 2002 annual performance goals, used for
the purpose of determining potential annual incentive compensation for the
executive officers. The performance goals were primarily quantitative in nature,
resulting in an incentive plan formula made up of various factors weighted in
accordance with their overall importance in attaining Regions' annual profit
plan. The 2002 incentive formula focused on the accomplishment of financial and
operational objectives, with particular emphasis on earnings per share and
revenue goals. Regions exceeded target levels in both of its company-wide
performance goals and exceeded threshold performance in five of its regional
business unit goals. Based on the various levels of goal achievement, the chief
executive officer and the other named officers received cash incentive awards as
a formula driven percentage of 2002 base salary levels.
Long Term Incentive Compensation. Regions' 1999 Long Term Incentive Plan
("LTIP") permits the grant of long-term incentives in a variety of forms,
including stock options, performance shares and restricted stock. The committee
believes that it is desirable to increase management's equity ownership in
Regions in order to focus management's effort and commitment to build
profitability and stockholder value. The primary purpose of LTIP awards is to
encourage management to take long-term steps to achieve and sustain objectives
with respect to earnings per share and return on equity. Accordingly, with the
advice of its independent compensation consultant, the committee awarded LTIP
grants to the executive officers during 2002, consisting of stock options and
performance accelerated restricted stock.
In establishing the LTIP awards for the named officers, senior management
and other key employees, the committee reviewed with the chief executive officer
the recommended individual awards (for officers other than himself), considering
the scope of accountability, financial goals, and anticipated performance
requirements and contributions expected of the participants. The committee also
took into account the number and size of LTIP awards and stock options already
held by executive officers considered for additional awards.
Compensation of Chief Executive Officer. In deliberating the compensation
of the chief executive officer, the committee follows similar methodology and
approach applied to executive compensation generally. Accordingly, the base
salary determination reflects the peer group survey comparison described above,
the annual incentive compensation is based on an objective formula and tied to
Regions' achievement of pre-determined, quantitative financial goals, and the
realization of long-term incentive compensation, by its nature, is aligned with
the realization of long-term stockholder value. As in the case of setting
executive compensation generally, the committee obtains advice from an
independent compensation consultant. Mr. Jones did not participate in
deliberations and decisions regarding his own compensation.
15
In setting the base salary for Mr. Jones in 2002, the committee considered
the range of base salaries of the chief executive officer position as reflected
in the survey comparison. In addition, the committee took into account other
factors, most notably, total compensation target, individual performance, and
general market factors as well as a subjective assessment of Mr. Jones' overall
contributions to Regions' financial and operating success. The committee set Mr.
Jones' base salary for 2002 at a level it concluded would be appropriate in
light of the circumstances the committee considered, while recognizing that his
base salary would remain in the low end of the range of salaries of chief
executives of comparable bank holding companies.
LTIP awards for Mr. Jones were set separately and independently of his
participation, based on ownership and total compensation objectives that
reflected data from selected peer companies, his total compensation, his
responsibilities as chief executive officer, and the committee's desire to set
appropriate long-term performance objectives.
Summary. The compensation committee of the board of directors remains
dedicated to ensuring that Regions' overall compensation program for its
executive officers, senior management and other key employees is appropriately
designed to:
- Attract, motivate, and retain outstanding contributors;
- Maintain a base salary structure that is competitive in Regions'
marketplace;
- Link annual incentive awards with specific performance targets that yield
superior results; and
- Provide long-term equity-based incentive awards that further align the
interests of Regions' management with those of its stockholders.
Section 162(m) of the Internal Revenue Code, as amended (the "Code"),
generally disallows a tax deduction to public companies for compensation over
$1,000,000 paid to a company's chief executive officer and four other most
highly compensated executive officers, as reported in its proxy statement.
Qualifying performance-based compensation is not subject to the deduction limit
if certain requirements are met. It is the committee's intent to maximize the
deductibility of executive compensation while retaining the discretion necessary
to compensate executive officers in a manner commensurate with performance and
the competitive market of executive talent.
The compensation committee will continue to review and evaluate
compensation programs at least annually. When and where appropriate, the
committee will consult with independent compensation consultants, legal
advisors, and Regions' public accounting firm with respect to the proper design
of the program toward achieving Regions' objectives as set forth by the chief
executive officer and the Regions board.
The foregoing report of the compensation committee is furnished by the
present directors who served on the committee during all or part of 2002:
James S. M. French, chairman
Sheila S. Blair
Susan Matlock
C. Kemmons Wilson, Jr.
FINANCIAL PERFORMANCE
Set forth below is a graph comparing the yearly percentage change in the
cumulative total return of Regions' common stock against the cumulative total
return of the S & P 500 Index, and the S&P 500 Banks Index for the past five
years. This presentation assumes that the value of the investment in Regions'
common stock and in each index was $100 and that all dividends were reinvested.
Commencing in 2002, Regions has included the S & P 500 Banks Index in this
presentation to better reflect its present size and geographic coverage, and its
move in 2002 to a New York Stock Exchange listing of its common stock. For the
same reasons, Regions is no longer including the Nasdaq Banks Index in this
presentation.
16
(PERFORMANCE GRAPH)
Period ending
12/31/97 12/31/98 12/31/99 12/31/00 12/31/01 12/31/02
Regions $100.00 $ 98.00 $ 63.00 $ 72.00 $ 82.00 $ 94.00
S&P 500 Index 100.00 129.00 156.00 141.00 125.00 97.00
S&P 500 Banks Index 100.00 106.00 91.00 109.00 109.00 108.00
OTHER TRANSACTIONS
Directors and officers of Regions and their associates were customers of,
and had transactions with, Regions' affiliates in the ordinary course of
business during 2002; additional transactions may be expected to take place in
the ordinary course of business. Included in such transactions are outstanding
loans and commitments, all of which were made on substantially the same terms,
including interest rates and collateral, as those prevailing at the time for
comparable transactions with other persons, and did not involve more than the
normal risk of collectibility or present other unfavorable features.
Regions retained during 2002 and prior years and proposes to retain in the
future on behalf of Regions or certain of its subsidiaries the law firm Stewart,
Melvin & Frost, LLP, of which director W. Woodrow Stewart is a partner. During
2002, Regions or its subsidiaries paid legal fees of $156,000 to the firm of
Stewart, Melvin & Frost, LLP.
RATIFICATION OF SELECTION OF INDEPENDENT AUDITORS
GENERAL
The audit committee has selected Ernst & Young LLP as Regions' independent
auditors for the 2003 fiscal year. The board of directors recommends that the
stockholders ratify the selection of Ernst & Young. Ernst & Young (or its
predecessor) has served as Regions' independent auditors since Regions'
inception in 1971.
Ernst & Young LLP has been engaged to provide auditing services and also to
provide tax services and general accounting advice. In making this selection,
the audit committee considered whether the engagement by Regions of Ernst &
Young for services other than audit services is compatible with Ernst & Young's
independence and concluded that the provision of the nonaudit services
referenced in the table below is compatible with maintaining the independence of
Ernst & Young.
A representative of the firm will be present at the stockholders' meeting
to make a statement if he or she so desires and to respond to appropriate
questions from stockholders.
17
AUDIT FEES, AUDIT-RELATED FEES, TAX FEES, AND ALL OTHER FEES
The aggregate fees paid to Ernst & Young LLP by Regions during 2002 and
2001 are set forth in the following table. Amounts for 2001 have been
reclassified to conform to 2002 presentation.
2002 2001
---------- ----------
Audit fees(1)............................................... $1,405,000 $1,449,000
Audit-related fees(2)....................................... 327,000 338,000
Tax fees(3)................................................. 3,956,000 1,300,000
All other fees(4)........................................... 663,000 2,400,000
---------- ----------
Total fees........................................ $6,351,000 $5,487,000
========== ==========
---------------
(1) Audit fees included fees associated with the annual audit, the reviews of
Regions' quarterly reports on Form 10-Q, regulatory filings, and statutory
audits of Regions and its subsidiaries.
(2) Audit-related fees primarily included accounting consultation, assistance
with securitizations or other accounting transactions and audits of employee
benefit plans.
(3) Tax fees included tax compliance services, tax advice, and tax planning
assistance. The increased tax fees in 2002 primarily related to tax planning
engagements initiated in 2002.
(4) All other fees included primarily assistance with human resources services,
cash management services and risk management services. No financial
information systems implementation and design services were rendered by
Ernst & Young during 2002 or 2001.
In accordance with the audit committee charter, as amended, the audit
committee must preapprove any engagement of Ernst & Young LLP for audit or
nonaudit services. The audit committee has delegated to its chairperson the
authority to preapprove permissible nonaudit services, provided the anticipated
fee for such service does not exceed $50,000. Any such approval of nonaudit
services pursuant to this delegation of the full audit committee's authority
must be presented to the audit committee at its next regular meeting. A request
for preapproval of services may be initiated by the comptroller of Regions, who
may consult with the coordinating partner of Ernst & Young for the audit
engagement.
PROPOSALS OF STOCKHOLDERS
Proposals by stockholders intended to be presented at Regions 2004 annual
meeting of stockholders must be received by Regions not later than December 18,
2003, for consideration for possible inclusion in the proxy statement relating
to that meeting.
OTHER BUSINESS
Regions does not know of any business to be presented for action at the
meeting other than those items listed in the notice of the meeting and referred
to herein. If any other matters properly come before the meeting or any
adjournment thereof, it is intended that the proxies will be voted in respect
thereof in accordance with the recommendations of the board of directors.
By Order of the Board of Directors
/s/ Samuel E. Upchurch, Jr.
Samuel E. Upchurch, Jr.
Corporate Secretary
Dated April 16, 2003
18
APPENDIX A
REGIONS FINANCIAL CORPORATION
AUDIT COMMITTEE CHARTER
PURPOSE
The Audit Committee of Regions Financial Corporation (the "Company") is
appointed by the Board of Directors to assist the Board of Directors in
fulfilling its oversight responsibilities to the stockholders, potential
stockholders, the investment community and others related to: (a) the integrity
of the Company's publicly reported financial statements and the financial
reporting process; and the systems of internal accounting and financial
controls, (b) the Company's compliance with ethics policies and legal and
regulatory requirements, (c) the independent auditors' qualifications and
independence, and (d) the performance of the Company's internal audit function
and independent auditors. In furtherance of this purpose, the Audit Committee
shall maintain direct communication among the Company's independent auditors,
Director of Internal Audit and internal auditors, the Board of Directors and
management of the Company. In discharging its oversight role, the Audit
Committee is empowered to investigate any matter brought to its attention with
full access to all books, records, facilities and personnel of the Company and
has the authority to retain at Company expense outside legal, accounting or
other advisors to advise the Audit Committee. The Audit Committee shall produce
an annual report for inclusion in the Company's proxy statement for the annual
meeting of stockholders, in accordance with applicable rules and regulations.
The Audit Committee's job is one of oversight and it recognizes that the
Company's management is responsible for preparing the Company's financial
statements and that the outside auditors are responsible for auditing those
financial statements. Additionally, the Audit Committee recognizes that
financial management, as well as the independent auditors, have more time,
knowledge and more detailed information about the Company than do Audit
Committee members; consequently, in carrying out its oversight responsibilities,
the Audit Committee is not providing any expert or special assurance as to the
Company's financial statements or any professional certification as to the
independent auditors' work.
To the extent necessary to fulfill its responsibility, the committee will
also communicate with the Company's Legal Department, Financial Reporting
Department, Security Department, Loan Review function, and others as it deems
necessary.
COMPOSITION
The Audit Committee shall be composed of at least three directors appointed
by the Board of Directors on the recommendation of the Nominating and Corporate
Governance Committee. The Chairman of the Audit Committee shall be designated by
the Board of Directors. The members of the Audit Committee shall meet the
independence and experience requirements of the Sarbanes-Oxley Act of 2002, the
New York Stock Exchange, and the Securities and Exchange Commission, as the same
may be amended from time to time, and shall be free of any relationship that, in
the opinion of the Board of Directors, would interfere with their exercise of
independent judgment as a committee member. All Audit Committee members will be
financially literate, and at least one member will be an "audit committee
financial expert" as defined by SEC regulations. Audit Committee members serve
at the pleasure of the Board of Directors and may be replaced at any time by the
Board.
In carrying out its responsibilities, the Audit Committee believes its
policies and procedures should remain flexible, in order to best react to
changing conditions and to ensure to the directors and stockholders that the
corporate accounting and reporting practices of the Company are in accordance
with all requirements and are of the highest quality.
In order to fulfill its primary responsibilities, the Audit Committee shall
meet as often as deemed necessary but not less than quarterly. Minutes of each
of these meetings shall be kept and the Director of Internal Audit and General
Counsel will function as the management liaison officer to the Audit Committee.
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On not less than an annual basis, the Audit Committee shall:
- Obtain the full Board of Directors' approval of this Charter, review
and reassess the adequacy of the Charter as conditions dictate, and
evaluate the performance of the Audit Committee and report the results
thereof to the Board of Directors.
- Be directly responsible for the appointment, compensation, and
oversight of the work of any registered public accounting firm
employed by the Company (including resolution of disagreements between
management and the auditor regarding financial reporting) for the
purpose of preparing or issuing an audit report or related work, and
each such registered public accounting firm shall report directly to
the audit committee. Retain and terminate the Company's independent
auditors, with sole authority to pre-approve, to the extent required
by applicable law, all audit and non-audit engagements and the related
fees and terms with the independent auditors. In accordance with
applicable law, the Audit Committee may delegate this authority to one
or more designated members of the Audit Committee; provided that any
such decision made pursuant to the foregoing delegation of authority
shall be presented to the Audit Committee at its next
regularly-scheduled meeting.
- Reaffirm a clear understanding with the independent auditors that they
are ultimately accountable to the stockholders, through the Audit
Committee and the Board of Directors as representatives of the
stockholders.
- Evaluate the qualifications, independence and performance of the
independent auditors on the basis of such factors as it shall deem
appropriate. Obtain and review a report from the independent auditor
at least annually regarding (a) the auditor's internal quality-control
procedures, (b) any material issues raised by the most recent
quality-control review, or peer review, of the firm, or by any inquiry
or investigation by governmental or professional authorities within
the preceding five years respecting one or more independent audits
carried out by the firm, (c) any steps taken to deal with any such
issues, and (d) all relationships between the independent auditor and
the Company. Discuss with corporate management the qualifications,
independence and performance of the independent auditors. The
independent auditors shall report directly to the Audit Committee and
are ultimately accountable to the Audit Committee and the Board of
Directors.
- Recommend to the Board clear hiring policies for current or former
employees of the independent auditors.
- Meet separately and periodically with corporate management, the
Director of Internal Audit and the independent auditors.
- Meet with the independent auditors and financial management of the
Company to review the scope of the proposed audit and timely quarterly
reviews for the current year and the procedures to be utilized, the
adequacy of the independent auditor's compensation, and at the
conclusion thereof report such audit or review, including any comments
or recommendations of the independent auditors, to the Board of
Directors. Study and make recommendations to the Board of Directors
with respect to audit policies and procedures and the scope and extent
of audits. In consultation with corporate management, the independent
auditors, and the internal auditors, consider the integrity of the
Company's financial reporting processes and controls. Discuss
significant financial risk exposures and the steps corporate
management has taken to monitor, control, and report such exposures.
- Review with the independent auditors, the Company's internal auditor,
and financial and accounting personnel, the adequacy and effectiveness
of the accounting and financial controls of the Company, and elicit
any recommendations for the improvement of such internal controls or
particular areas where new or more detailed controls or procedures are
desirable.
- Review with financial management and the independent auditors the
results of their timely analysis of significant financial reporting
issues and practices, including changes in, or adoptions of,
accounting principles and disclosure practices, and discuss any other
matters required to be communicated to the committee by the auditors.
Also review with financial management and the
A-2
independent auditors their judgments about the quality, not just
acceptability, of accounting principles and the clarity of the
financial disclosure practices used or proposed to be used, and
particularly, the degree of aggressiveness or conservatism of the
organization's accounting principles and underlying estimates, and
other significant decisions made in preparing the financial statements
including information on critical policies and practices of the
Company.
- Report the results of the annual audit to the Board of Directors. If
requested by the board, invite the independent auditors to attend the
full Board of Directors meeting to assist in reporting the results of
the annual audit or to answer other directors' questions
(alternatively, the other directors, particularly the other
independent directors, may be invited to attend the Audit Committee
meeting during which the results of the annual audit are reviewed).
- Review the Company's disclosure in the proxy statement for its annual
meeting of stockholders that describes that the Audit Committee has
satisfied its responsibilities under this Charter for the prior year.
In addition, include a copy of this Charter in the annual report to
stockholders or the proxy statement at least triennially or the year
after any significant amendment to the Charter.
- Review the report of the Audit Committee in the annual report to
stockholders, the annual report on Form 10-K, or the annual proxy
statement disclosing whether or not the committee had reviewed and
discussed with management and the independent auditors, as well as
discussed within the committee (without management or the independent
auditors present), the financial statements and the quality of
accounting principles and significant judgments affecting the
financial statements. The report of the Audit Committee would include
a statement by that committee whether anything has come to their
attention that caused them to believe that the audited financial
statements contain an untrue statement of material fact or fail to
state a material fact necessary to avoid making the financial
statements misleading.
- Review the report to the Audit Committee from the Company's
independent auditors in accordance with Section 204 of the
Sarbanes-Oxley Act of 2002. Review the contents of such report and all
major accounting policy matters involved in the preparation of interim
and annual financial reports with corporate management and any
deviations from prior practice with the independent auditors.
- Meet quarterly with corporate management and with the independent
auditors, to discuss the annual audited financial statements,
including footnotes, the unaudited quarterly financial results prior
to the release of earnings and/or the quarterly financial statements
prior to filing or distribution, including, in each case, a review of
the Company's disclosures under "Management's Discussion and Analysis
of Financial Condition and Results of Operations." In discharging this
obligation, receive and review, if necessary, a report from the
controller as to any unusual deviations from prior practice that were
included in the preparation of the annual or quarterly financial
results. Review and discuss (1) draft press releases of unaudited
interim and annual financial results before public release and (2)
financial information and earnings guidance provided to analysts and
ratings agencies. Press releases and interim financial statements also
will be reviewed by the independent auditors prior to public release.
The chair of the committee may represent the entire committee for
purposes of this review.
- Review information, if any, provided by the independent auditors
pursuant to Section 10A of the Securities Exchange Act of 1934 and
make such recommendations to the Board of Directors as it shall deem
appropriate.
- Report annually to the Board of Directors, after the close of each
fiscal year but prior to the Company's annual meeting of stockholders,
as well as on any other occasion, any issues that arise with respect
to the quality or integrity of the Company's publicly reported
financial statements, the Company's compliance with legal or
regulatory financial disclosure requirements, the performance and
independence of the independent auditors, the performance of the
internal audit function, or whatever it deems appropriate concerning
the activities of the Audit Committee.
- Review annually the Company's internal auditing program and
significant reports with the Director of Internal Audit and corporate
management's response and follow-up to those reports.
A-3
- At a time when the annual audit plan is being developed, review with
the independent auditors and with the Director of Internal Audit the
internal audit function of the Company including the independence and
authority of its reporting obligations, the proposed audit plans for
the coming year, and the coordination of such plans with the
independent auditors. Such review should include the plan's timing,
scope, staffing, locations, foreseeable issues, priorities and
procedures, the coordination between the independent auditors and the
Director of Internal Audit in executing the plan and the engagement
team.
- Review and assess the adequacy of internal accounting procedures and
controls, including a review with the independent auditors of their
evaluation of the Company's internal controls. Review quarterly the
programs that the Company has instituted to correct any control
deficiencies noted by the Director of Internal Audit in his or her
periodic review or the independent auditors in their annual review.
Discuss with management the results of the foregoing reviews,
including significant items and potential ways to improve the
accounting procedures and controls.
- On a quarterly basis, receive prior to or during each meeting a
summary of findings from completed internal audits and report
significant deviation from the approved audit plan.
- Satisfy itself as to the professional competency of the Director of
Internal Audit and the adequacy of his or her staff in discharging the
responsibility of the office. Review with management the appointment
and replacement of the Director of Internal Audit. To the extent it
deems necessary or appropriate, review and concur with management's
appointment, termination, or replacement of the Director of Internal
Audit.
- Provide sufficient opportunity for the internal and independent
auditors to meet with the members of the Audit Committee without
members of management present. Among the items to be discussed in
these meetings are the independent auditors' evaluation of the
Company's financial, accounting, and auditing personnel, the
cooperation that the independent auditors received during the course
of audit, any difficulties encountered, any restrictions on their
work, significant disagreements with corporate management and their
findings and recommendations. Discuss certain matters required to be
communicated to the Audit Committee in accordance with AICPA SAS 61.
- Review reports received from regulators and other legal and regulatory
matters that may have a material effect on the financial statements or
related company compliance policies.
- Inquire of management, the internal auditor, and the independent
auditors about significant risks or exposures and assess the steps
management has taken to minimize such risks to the Company.
- Establish procedures for (i) the receipt, retention and treatment of
complaints received by the Company regarding accounting, internal
accounting controls, or auditing matters and (ii) the confidential,
anonymous submission by employees of the Company of concerns regarding
questionable accounting or auditing matters.
- Investigate any matter brought to its attention within the scope of
its duties, with the power to retain outside counsel for this purpose
if, in its judgment, that is appropriate.
- Report to the Board of Directors, as appropriate, by submitting the
minutes of all meetings of the Audit Committee to, or discussing the
matters discussed at each committee meeting with the Board of
Directors.
- Perform any other activities consistent with this Charter, the
Company's bylaws, and governing law as the Audit Committee or the
Board deems necessary or appropriate.
While the Audit Committee has the responsibilities and powers set forth in
this Charter, it is not the duty of the Audit Committee to plan or conduct
audits or to determine that the Company's financial statements and disclosures
are complete and accurate and are in accordance with generally accepted
accounting principles and applicable rules and regulations. These are the
responsibilities of management and the independent auditor.
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[FORM OF PROXY]
REGIONS FINANCIAL CORPORATION
P.O. Box 10247
Birmingham, Alabama 35202-0247
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
The undersigned hereby appoints Carl E. Jones, Jr., Richard D. Horsley, and
Samuel E. Upchurch, Jr., and each or any one of them, as Proxies, each with the
power to appoint his substitute, and hereby authorizes each to represent and to
vote, as designated on the reverse side, all the shares of common stock of
Regions Financial Corporation ("Regions") held of record by the undersigned on
April 4, 2003, at the annual meeting of stockholders to be held May 14, 2003,
or any adjournment thereof. This card also constitutes voting instructions for
all shares beneficially owned and votable, if any, by the undersigned as a
participant in the Regions Financial Corporation Dividend Reinvestment Plan,
401(K) Plan and/or Directors Stock Investment Plan and held of record by the
administrators and trustees of such Plans. IF NO DIRECTION IS MADE AS TO THE
MANNER OF VOTING, THE PROXY WILL BE VOTED FOR THE NOMINEES LISTED IN ITEM 1 AND
FOR ITEM 2.
Should the undersigned by present and elect to vote at the annual meeting or at
any adjournment thereof and after notification to the secretary of Regions at
the meeting of the stockholder's decision to terminate this proxy, then this
proxy shall be deemed terminated and of no further force and effect. This proxy
may also be revoked by submission of a properly executed subsequently dated
proxy or by written notice to Regions for receipt prior to the annual meeting.
--------------------------------------------------------------------------------
- FOLD AND DETACH HERE -
[X] Please mark your 6769
votes as in this
example.
THIS PROXY WHEN PROPERLY EXECUTED WILL BE VOTED IN THE MANNER DIRECTED
HEREIN BY THE UNDERSIGNED STOCKHOLDER. IF NO DIRECTION IS MADE, THIS PROXY WILL
BE VOTED FOR THE NOMINEES LISTED IN ITEM 1 AND FOR ITEM 2.
FOR WITHHELD FOR AGAINST ABSTAIN
1. Election of [ ] [ ] To elect the four nominees for director 2. To ratify the selection of [ ] [ ] [ ]
Directors of Regions listed below: Ernst & Young LLP as
independent auditors of
For, except vote withheld (01) James B. Boone, Jr., Regions for the year ending
from the following nominee(s): (02) James S.M. French, December 31, 2003.
(03) Richard D. Horsley, and
(04) W. Woodrow Stewart 3. In their discretion on such other business as may
______________________________ properly come before the meeting or any adjournments
thereof.
Please sign exactly as your name appears on this card.
When signing as attorney, executor, administrator,
trustee or guardian, please give full title. If shares
are held jointly, each holder must sign.
Please complete, date, sign and mail this proxy
promptly in the enclosed postage-paid envelope.
________________________________________________________
2003
________________________________________________________
SIGNATURES(S) DATE
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- FOLD AND DETACH HERE -
REGIONS FINANCIAL CORPORATION
Regions stockholders can now vote their shares either by telephone or on the
internet. This eliminates the need to return the proxy card. To vote your shares
over the telephone or the internet you must have your proxy card and SSN
available. The series of numbers that appear in the box above must be used to
access the system.
1. To vote over the telephone: On a touch-tone telephone call
1-(877)-PRX-VOTE (1-877-779-8683), 24 hours a day, seven days a week.
2. To vote over the internet: Log on to the internet and go to the website
www.eproxyvote.com/rgbk.
Your vote over the telephone or the internet authorized the named proxies
in the same manner as if you marked, signed, dated and returned your proxy card.
If you choose to vote your shares over the telephone or the internet, there is
no need for you to mail back the proxy card.