ZIONS BANCORPORATION
One South Main, Suite 1380, Salt Lake City, Utah 84111
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
To Be Held On
April 24, 1998
To the Shareholders:
The Annual Meeting of the Shareholders of Zions Bancorporation (the
"Company") will be held in the Founders' Room of Zions First National Bank, One
South Main Street, Salt Lake City, Utah, on Friday, April 24, 1998, at 1:30 p.m.
for the following purposes:
1. To elect directors for the terms specified in the attached
Proxy Statement (Proposal 1);
2. To approve an increase in the number of authorized shares of
Capital Stock (Proposal 2);
3. To approve amendments to the Key Employee Incentive Stock Option
Plan (Proposal 3);
4. To approve the appointment of independent auditors for the year
1998(Proposal 4); and
5. To transact such other business as may properly come before the
shareholders (Proposal 5).
Your proxy is being solicited by the Board of Directors. For the
reasons stated herein, your Board of Directors unanimously recommends that you
vote "for" proposals 1, 2, 3 and 4 and "authority" for proposal 5.
A Proxy Statement, Proxy Card, and a copy of the Annual Report on the
Company's operations during the fiscal year ended December 31, 1997, accompany
this notice.
IT IS IMPORTANT THAT ALL SHAREHOLDERS BE REPRESENTED AT THE MEETING.
Shareholders who are unable to attend in person SHOULD IMMEDIATELY SIGN, DATE
AND MAIL the accompanying form of proxy in the enclosed envelope which requires
no postage.
The prompt return of proxies will save the Company the expense of
further requests for proxies which might otherwise be necessary in order to
ensure a quorum.
By order of the Board of Directors
Dale M. Gibbons
Secretary
Salt Lake City, Utah
March 25, 1998
PROXY STATEMENT
ZIONS BANCORPORATION
One South Main, Suite 1380, Salt Lake City, Utah 84111
ANNUAL MEETING OF SHAREHOLDERS
April 24, 1998
VOTING AT THE MEETING
Your proxy is solicited by your Board of Directors. It will be voted as you
direct. If no contrary direction is given, your proxy will be voted:
- FOR the election of directors listed below;
- FOR the increase in the number of authorized capital shares as
described in this Proxy Statement;
- FOR the amendments to the Key Employee Incentive Stock Option
Plan; and
- FOR approval of the selection of KPMG Peat Marwick LLP,
Certified Public Accountants, as independent auditors for the
Company for the fiscal year ending December 31, 1998.
You may revoke your proxy at any time before it is voted by giving written
notice to the Secretary, Zions Bancorporation, or by mailing a later-dated
proxy, or by voting in person at the meeting.
The only shares that may be voted are the 69,053,648 shares of common stock
outstanding at the close of business on February 27, 1998, the record date for
the meeting. Each share is entitled to one vote.
Shareholders may expressly abstain from voting on Proposals 2, 3 and 4 in
the accompanying Notice of Annual Meeting of Shareholders. Where some or all of
the shares represented by the duly executed and returned proxy of a broker or
other nominee are not voted on one or more items, pursuant to the rules of the
national securities exchange of which the nominee is a member or of the National
Association of Securities Dealers or otherwise, the shares will be treated as
represented at the meeting but not voted. On all matters other than the election
of directors, the action will be approved if a quorum is present and the number
of shares voted in favor of the action exceeds the number of shares voted
against the action.
The cost of soliciting proxies will be borne by the Company. The Company
will reimburse brokers and others who incur costs to send proxy materials to
beneficial owners of stock held in a broker or nominee name. Directors, officers
and employees of the Company may solicit proxies in person or by mail or
telephone, but will receive no extra compensation for doing so. This Proxy
Statement is first being mailed to the shareholders of Zions Bancorporation on
or about March 25, 1998.
1
NOMINATION AND ELECTION OF DIRECTORS
(Proposal 1)
It is intended that the proxies received will be voted for the election of
nominees for director named herein unless otherwise indicated. In case any of
the nominees named herein is unable or declines to serve, an event which
management does not anticipate, proxies will then be voted for a nominee who
shall be designated by the present Board of Directors to fill such vacancy.
Directors are elected by a plurality of the votes cast at the meeting, with the
three persons receiving the highest number of votes to be elected.
The following persons are nominated for election as directors for the
specified term, and until their successors are elected and qualified, and will,
together with other directors presently in office, constitute the entire elected
Board of Directors: Three-year Term
Roger B. Porter
L.E. Simmons
I.J. Wagner
The Board of Directors recommends that the Shareholders vote FOR the election of
the nominees for director set forth above.
The following information is furnished with respect to each of the nominees for
election as directors, as well as for directors whose terms of office will not
expire prior to the Annual Meeting of Shareholders:
Present
Director Term
Nominees Principal Occupation During Past Five Years Since Expires Age
- -------- ------------------------------------------- ----- ------- ---
Roger B. Porter(1)(3)(6) IBM Professor of Business and Government, 1993 1998 51
Harvard University; Assistant to the President
for Domestic and Economic Affairs, The White
House, 1989-1992; Director, Rightchoice Managed
Care Inc. and Tenneco, Inc.
L.E. Simmons (4) (5) President, SCF Investment Partners (Private 1978 1998 51
Equity Investment Management), Houston, Texas;
Chairman, Tuboscope Vetco International Corp.
and Director, CE Franklin, Ltd.
I.J. Wagner (1) (2) (6) President, The Keystone Company (Corporate 1965 1998 82
Investments), Salt Lake City, Utah.
2
DIRECTORS WITH UNEXPIRED TERMS OF OFFICE
Jerry C. Atkin (3)(6) Chairman, President and Chief Executive Officer, 1993 1999 49
SkyWest Airlines, St. George, Utah; Director,
SkyWest, Inc.
Grant R. Caldwell (1)(6) Retired, former Partner, KMG Main Hurdman, Salt 1993 1999 73
Lake City, Utah.
R.D. Cash (2)(6) Chairman, President and Chief Executive Officer 1989 2000 55
of Questar Corporation, Salt Lake City, Utah;
Member of the Board of Directors of Zions First
National Bank; Director, Energen Corporation.
Richard H. Madsen (1)(6)(3) Chairman, President and Chief Executive Officer, 1994 2000 59
ZCMI.
Robert G. Sarver (4) Executive Director, Southwest Value Partners and 1994 2000 36
Affiliates; Chairman of Grossmont Bank;
Director, Monterey Homes Corporation; President,
National Bank of Arizona, 1992-1994.
Harris H. Simmons (2)(5) President and Chief Executive Officer of the 1989 2000 43
Company; Chairman of Zions First National Bank;
Member of the Board of Directors of Questar
Corporation.
Roy W. Simmons (2)(4) Chairman of the Company; Member of the Board of 1961 1999 82
Directors of Zions First National Bank.
(1) Member of the Audit Committee (5) Son of Roy W. Simmons
(2) Member of the Executive Committee (6) Independent Directors
(3) Member of the Executive Compensation Committee Committee
(4) Member of the Credit Review/Compliance Committee
3
COMPENSATION OF DIRECTORS
The Company's outside directors currently receive a $12,000 annual retainer
and $600 for each regular and special meeting attended. Members of the
committees receive $500 for each committee meeting attended. The Chairman of the
Audit Committee receives an additional $6,000 annual retainer and members of the
Audit Committee receive an additional $3,000 annual retainer. Directors who are
full-time compensated employees of the Company do not receive either the
retainer or any other compensation for meetings of the Board of Directors or its
committees.
The Company maintains a Deferred Compensation Plan for directors whereby a
director may elect to defer receipt of all or a portion of his compensation
until retirement or resignation from the Board. The director may elect to invest
the deferred fees in an interest-bearing unsecured note, or in "phantom" stock,
whereby the earnings will be calculated as if the deferred compensation had been
invested in the Company's common stock (although an actual investment is not
made and settlement is made only in cash).
COMMITTEES OF THE BOARD OF DIRECTORS
The Board of Directors held seven meetings during the fiscal year ending
December 31, 1997. Of the Board's four standing committees, the Executive
Committee did not meet, the Audit Committee met five times, the Executive
Compensation Committee met once, and the Credit Review/Compliance Committee met
four times during the fiscal year ending December 31, 1997. The Independent
Directors Committee, which was created solely to deal with potential conflicts
created by the GB Bancorporation acquisition, met twice. Membership in these
committees is indicated above in the listing of directors. Average attendance at
Board and committee meetings held during the year was 98%. The Company has no
nominating committee and no other established committee acts in that capacity.
The Executive Committee reviews projects or proposals which require prompt
action on the part of the Company. The Executive Committee is authorized to
exercise all powers of the Board of Directors with respect to such projects or
proposals for which it would not be practicable to delay action pending approval
of the entire Board. The Executive Committee does not have authority to amend
the Articles of Incorporation or Bylaws, adopt a plan of merger, or to recommend
to shareholders the sale of all or substantially all of the Company's assets.
The Audit Committee reviews and discusses the plan for, and results of, the
annual audit with the Company's independent auditors and approves non-audit
services provided by them. The Committee also reviews the Company's internal
auditing, control and accounting systems. In addition, the Committee makes
recommendations to the Board concerning the selection of independent auditors.
The Executive Compensation Committee fixes the compensation of corporate
executive officers and approves any employment or consulting contracts with
corporate officers who are not also directors.
The Credit Review/Compliance Committee is a joint committee of the Company
and Zions First National Bank. The Committee monitors the results of internal
credit examinations, and reviews adherence to policies established by the Board
and by management with respect to lending, as well as general management issues.
4
EXECUTIVE OFFICERS OF THE COMPANY
The following information is furnished with respect to certain of the
executive officers of the Company.
Individual Principal Occupation During Past Five Years(2) Officer Since Age
- ---------- ---------------------------------------------- ------------- ---
Roy W. Simmons(1) Chairman of the Company; Member of the Board of Directors of 1961 82
Zions First National Bank; prior to January 1998, Chairman
of Zions First National Bank.
Harris H. Simmons(1) President and Chief Executive Officer of the Company; 1981 43
Chairman of Zions First National Bank; Member of the Board
of Directors of Questar Corporation; prior to January 1988,
President and Chief Executive Officer of Zions First
National Bank.
A. Scott Anderson Executive Vice President; President and Chief Executive 1997(3) 51
Officer of Zions First National Bank; prior to January
1998, Executive Vice President of Zions First National Bank.
Danne L. Buchanan Executive Vice President of the Company; President of Zions 1995 40
Data Services Company; prior to March 1995, Senior Vice
President and General Manager of Zions Data Services
Company; prior to January 1998, Senior Vice President of the
Company.
Gerald J. Dent Executive Vice President of the Company; Executive Vice 1987 56
President of Zions First National Bank; prior to January
1998, Senior Vice President of the Company.
Dale M. Gibbons Executive Vice President, Chief Financial Officer and 1996 37
Secretary of the Company; Executive Vice President and
Secretary of Zions First National Bank; prior to August
1996, Senior Vice President of First Interstate Bancorp;
prior to January 1998, Senior Vice President of the Company.
John J. Gisi Senior Vice President of the Company; Chairman and 1994 52
Chief Executive Officer of National Bank of Arizona;
Director, ASR Investments Corp.
5
W. David Hemingway Executive Vice President of the Company; Executive Vice 1997(4) 50
President of Zions First National Bank; Director,
Federal Agricultural Mortgage Corporation.
Clark B. Hinckley Senior Vice President of the Company; prior to March 1994, 1994 50
President of Zions First National Bank of Arizona.
George Hofmann III Senior Vice President of the Company; President and Chief 1995 48
Executive Officer of Nevada State Bank; prior
to April 1995, Senior Vice President of Zions First
National Bank.
Gary S. Judd Senior Vice President of the Company; President and Chief 1998 57
Executive Officer of Vectra Bank.
(1) Roy W. Simmons (Chairman of the Company) is the father of Harris H. Simmons
(President and Chief Executive Officer of the Company) and L. E. Simmons (a
member of the Board of Directors of the Company).
(2) Officers are elected for indefinite terms of office and may be replaced at
the discretion of the Board of Directors.
(3) Officer of Zions First National Bank since 1990.
(4) Officer of Zions First National Bank since 1977.
PRINCIPAL HOLDERS OF VOTING SECURITIES
The following table sets forth as of February 27, 1998, the record and
beneficial ownership of the Company's common stock by the principal common
shareholders of the Company.
Common Stock
Name and Address Type of Ownership No. of Shares % of Class
- ---------------- ----------------- ------------- ----------
Roy W. Simmons Record and Beneficial 2,279,815 3.30%
One South Main Street Beneficial(1) 1,991,376 2.88%
Salt Lake City, Utah 84111 --------- ----
4,271,191 6.18%
Zions First National Bank Record(2) 4,581,741 6.60%
One South Main Street
Salt Lake City, Utah 84111
(1) Represents Roy W. Simmons' beneficial ownership interest in 1,991,376
shares held by a company in which Mr. Simmons serves as a director.
(2) These shares are owned of record as of February 27, 1998, by Zions
First National Bank, a subsidiary of the Company, in its capacity as
fiduciary for various trust and advisory accounts. Of the shares shown,
Zions First National Bank has sole voting power with respect to a total
of 3,296,197 shares (4.7% of the class) it holds as trustee for the
Zions Bancorporation Employee Stock Savings Plan, the Zions
Bancorporation Employee Investment Savings Plan, and the Zions
Bancorporation Profit Sharing Plan. Zions First National Bank also acts
as trustee for the Zions Bancorporation Dividend Reinvestment Plan,
which holds 1,007,804 shares (1.4% of the class) and the Zions
Bancorporation PAYSOP Plan, which holds 277,740 shares (.4% of the
class) as to which Zions First National Bank does not have or share
voting power.
6
Set forth below is the beneficial ownership, as of February 27, 1998, of
the Company's common stock by each of the Company's directors, and all directors
and officers as a group.
No. of Shares % of
Directors Beneficially Owned Class
--------- ------------------ -----
Jerry C. Atkin 9,800 *(1)
Grant R. Caldwell 7,000 *(1)
R. D. Cash(3) 27,000 *(1)
Richard H. Madsen 197,622 *(1)
Roger B. Porter(3) 3,000 *(1)
Robert G. Sarver(3) 818,124 1.18
Harris H. Simmons 2,498,662(2) 3.62
L. E. Simmons(3) 2,296,229(2) 3.33
Roy W. Simmons(3) 4,271,191(2) 6.19
I. J. Wagner(3) 285,000 *(1)
All directors and officers
as a group (31 persons) 7,945,288 11.44
----------
(1) Immaterial percentage of ownership (Less than 2%)
(2) Totals include 1,991,376 shares attributed to each individual through
serving as a director in a company holding such shares in the Company.
Of such 1,991,376 shares attributed to Harris H. Simmons, Mr. Simmons
holds an option to acquire 186,792 shares, all of which are vested and
presently exercisable.
(3) These individuals also own phantom stock through the Company's Deferred
Compensation Plan for Directors which are not included in the above
totals. The amount of phantom stock held as of December 31, 1997 was as
follows: Mr. Cash, 24,134 shares; Mr. Porter, 8,313 shares; Mr. Sarver,
3,545 shares; Mr. L.E. Simmons, 5,193 shares; Mr. Roy Simmons, 20,137
shares; and Mr. Wagner, 2,891 shares.
Section 16(a) of the Securities Exchange Act of 1934 requires officers and
directors of the Company and persons who own more than 10% of a registered class
of the Company's equity securities to file reports of ownership and changes in
their ownership with the Securities and Exchange Commission. The secretary of
the Company acts as a compliance officer for such filings of its officers and
directors, and prepares reports for such persons based on information supplied
by them. Based solely on its review of such information, the Company believes
that for the period from January 1, 1997 through December 31, 1997, its officers
and directors were in compliance with all applicable filing requirements, except
that Mr. Robert Sarver filed a late report on shares sold, donated, and
transferred, Messrs. W. David Hemingway, Gerald J. Dent and Walter Kelly filed a
late report on stock options exercised, Mr. I.J. Wagner filed a late report on a
transfer of shares, and Messrs. A. Scott Anderson, Gerald J. Dent, L.E. Simmons,
James Jensen, Richard Madsen, Roy Simmons and Clark Hinckley filed late reports
on their dividend reinvestment plan shares.
7
EXECUTIVE COMPENSATION
The following Summary Compensation Table shows compensation earned from the
Company for services rendered during fiscal years 1997, 1996 and 1995 for the
person who was chief executive officer at the end of the last fiscal year, and
the four most highly compensated executive officers of the Company whose
salaries and bonuses exceeded $100,000 in 1997.
Summary Compensation Table
Long-term
Annual Compensation
Compensation(1) Awards
--------------- --------------------
Value- Securities All Other
Salary Bonus Sharing Underlying Compensation
Name and Principal Position Year ($)(2)(3)(4)($)(4)(5) ($)(7) Options(#)(6)($)(4)(8)(9)(10)
- --------------------------- -------------- ----------- ------ ------------- ---------------
Harris H. Simmons 1997 385,563 235,000 189,150 40,000 54,093
President and Chief 1996 353,103 200,000 144,950 20,000 53,577
Executive Officer, Zions 1995 355,326 170,000 84,950 20,000 49,180
Bancorporation
A. Scott Anderson 1997 207,101 110,000 138,225 20,000 27,600
President and Chief 1996 197,647 100,000 115,960 12,000 24,564
Executive Officer, Zions 1995 190,349 87,500 67,960 8,000 20,261
First National Bank
John J. Gisi 1997 242,925 110,000 0 18,000 17,762
Chairman and Chief 1996 216,500 98,000 0 12,000 17,552
Executive Officer, 1995 194,904 90,000 0 20,000 18,054
National Bank of Arizona
W. David Hemingway 1997 188,101 100,000 138,225 16,000 30,123
Executive Vice President, 1996 173,688 90,000 115,960 9,000 23,125
Zions Bancorporation 1995 162,689 73,000 67,960 7,000 24,579
Dale M. Gibbons(11) 1997 174,716 90,000 0 12,000 0
Executive Vice President, 1996 62,805 31,000 0 8,000 0
Zions Bancorporation 1995 0 0 0 0 0
- ---------------
(1) The column for other annual compensation has been omitted since the only
items reportable thereunder for the named persons are perquisites, which
did not exceed the lesser of $50,000 or 10% of salary and bonus for any of
the named persons.
(2) See "Certain Relationships and Related Transactions" regarding
non-qualified stock option income for John J. Gisi recognized in 1995,
1996 and 1997.
(3) Includes all contributions to the Company's Employee Stock Savings Plan,
Employee Investment Savings Plan, and Employee Medical Plan made through
salary reductions and deferrals.
8
(4) All employees of the Company who have at least one year of service, have
worked at least 1,000 hours in the previous twelve months, and are at
least twenty-one years of age are eligible to participate in the Company's
Employee Stock Savings Plan and the Company's Employee Investment Savings
Plan, which are defined contribution plans qualified under 401(k) of the
Internal Revenue Code. The plans require contributions from participants
in increments of one percent of compensation, up to a maximum of fifteen
percent. Contributions made under the Employee Stock Savings Plan are
aggregated with contributions made under the Employee Investment Savings
Plan for purposes of establishing the maximum contribution limitation,
which is fifteen percent. If the participant elects to have his
contributions invested in the Company's common stock through the Employee
Stock Savings Plan, the Company shall contribute to the participant's
account an amount equal to fifty percent of the participant's
contribution, up to five percent of the participant's compensation. The
Company shall contribute an additional amount equal to twenty-five percent
of the participant's contribution to the Employee Investment Savings Plan,
approximately five to ten percent of the participant's compensation.
Additional contributions of up to five percent of compensation may be made
by a participant but are not matched by the Company. The Company's
contributions are determined by reference to the employees' contributions
and are not discretionary. Vesting occurs upon contribution; however,
distribution of Company contributions is made only upon retirement,
permanent disability, death, termination of employment, or special
hardship situations. Participant contributions are included in amounts
shown as "Salary," above. The Company's matching contributions are
included under "All Other Compensation," above. For each of the persons
named above, the amounts accrued for 1997, 1996 and 1995 were as follows,
respectively: Mr. Simmons, $4,701, $3,750 and $14,316; Mr. Anderson,
$5,826, $1,841 and $3,160; Mr. Gisi, $6,000, $5,625 and $7,200; Mr.
Hemingway, $6,000, $5,353 and $6,995; and Mr. Gibbons, $0, $0 and $0.
(5) Cash bonuses are reported in the year earned but are paid in the following
year. Bonuses for Mr. Harris H. Simmons are established by the Executive
Compensation Committee of the Board of Directors (the "Compensation
Committee"). Bonuses for the other named officers are recommended by Mr.
Simmons and approved by the Compensation Committee. Bonuses are
discretionary, but are generally based upon the operating results of the
Company and the performance of the individuals.
(6) Options shown were issued under the Company's Incentive Stock Option Plan.
The plan is administered by the Compensation Committee. Options granted
have an exercise price equal to the fair market value on the date of
grant, vest over a term of three to five years, and expire in six years.
(7) Does not include amounts accrued by the Company against its potential
future liability under the Senior Management Value-Sharing Plan, a
deferred bonus plan for senior management. Awards funds were established
under the plan in 1991, 1992, 1993, 1994, 1995, 1996 and 1997 and members
of senior management were granted units of participation in each award
fund. Payouts under the plan with respect to each award fund occur four
years following the establishment of such fund, and are determined by
applying a formula established in connection with each award fund to the
Company's average return on equity and average per-share earnings during
the four-year period. The Company intends to establish award funds in
future years. The Company estimates its annual accrual against future
payouts under the plan each year by applying the formula established for
each award fund by the Board of Directors to the Company's performance in
the year. Payouts occurred under the plan in 1997, 1996 and 1995. Payouts
are reported in the above table under "Long-term Compensation Awards." For
each of the persons named above, the amounts accrued for 1997, 1996 and
1995 were as follows, respectively: Mr. Simmons, $390,073, $390,165 and
$211,192; Mr. Anderson, $273,705, $274,519 and $151,769; Mr. Gisi,
$245,703, $199,173 and $76,013; Mr. Hemingway, $256,124, $259,941, and
$147,845; and Mr. Gibbons, $201,243, $0 and $0. See "Long-term Incentive
Plan Awards in Fiscal 1997," that follows.
(8) Includes amounts accrued under the Company's Supplemental Executive
Retirement Plan (SERP) For additional details regarding the SERP, please
see page 12. For each of the persons named above, the amounts accrued for
1997, 1996 and 1995 were as follows, respectively: Mr. Simmons, $45,810,
$46,466 and $31,504; Mr. Anderson, $18,192, $19,362 and $13,741; Mr. Gisi,
$8,180, $8,566 and $7,494; Mr. Hemingway, $20,541, $14,411 and $14,224;
and Mr. Gibbons, $0, $0 and $0.
(9) Amounts of All Other Compensation are amounts contributed or accrued for
the named officers under the Company's Employee Stock Savings Plan,
Employee Investment Savings Plan, Supplemental Retirement Plan, and
Employee Profit Sharing Plan.
(10) In 1992, the Board of Directors adopted the Zions Bancorporation Employee
Profit Sharing Plan, a defined contribution plan, pursuant to which an
award is made to all employees as a percentage of salary and bonus when the
Company achieves annual profits representing a return on equity (net income
divided by average shareholders' equity) target established by the Board of
Directors of at least 14%. The minimum award is 1% of covered payroll at
14% return on equity, with the award to be a greater percentage of covered
payroll if the return on equity is greater. Amounts accrued to the accounts
of employees are invested in Company common stock. For each of the persons
named above, the amounts accrued for 1997, 1996 and 1995 were as follows,
respectively: Mr. Simmons, $3,582, $3,361 and $3,360; Mr. Anderson, $3,582,
$3,361 and $3,360; Mr. Gisi, $3,582, $3,361 and $3,360; Mr. Hemingway,
$3,582, $3,361 and $3,360; and Mr. Gibbons, $0, $0 and $0.
(11) Mr. Gibbons' employment by the Company commenced August 20, 1996.
9
Stock Option Grants in Fiscal Year 1997
The following table shows the number of shares with respect to which
options were granted during 1997 to each of the named persons, together with the
percentage of all grants to employees which the grant to the named person
represents, the exercise price of such option, and the expiration date of the
option.
Potential Realizable Value at
Assumed Annual Rates of Stock
Price Appreciation for
Individual Grants Option Term(1)
------------------------------- -------------------------------
% of Total
Options
Options Granted to Exercise
Granted Employees Price Expiration
Name (#)(2) in Fiscal Year ($/Sh) Date 5%($) 10%($)
---- ------ -------------- ------ ---------- ------- -------
Harris H. Simmons 40,000 8.77 31.00 03-20-2003 421,719 956,736
A. Scott Anderson 20,000 4.39 31.00 03-20-2003 210,859 478,368
John J. Gisi 18,000 3.95 31.00 03-20-2003 189,773 430,531
W. David Hemingway 16,000 3.51 31.00 03-20-2003 168,687 382,694
Dale M. Gibbons 12,000 2.63 31.00 03-20-2003 126,516 287,021
- ---------------
(1) Potential unrealized value is based on an assumption that the price of
the common stock appreciates at the annual rate shown (compounded
annually) from the date of grant until the end of the six-year option
term. These numbers are calculated based on the requirements
promulgated by the Securities and Exchange Commission and do not
reflect the Company's estimate of future stock price growth.
(2) The Company's Incentive Stock Option Plan is administered by the
Compensation Committee of the Board of Directors. The Compensation
Committee determines the eligibility of employees, the number of shares
to be granted and the terms of such grants. All stock options granted
in fiscal year 1997 were incentive stock options, have an exercise
price equal to the fair market value on the date of grant, vest 25% per
year beginning one year after date of grant, and have a term of six
years.
In accordance with the terms of the Non-Employee Directors Stock Option Plan,
non-qualified options were granted to each non-employee director in 1997. Each
grant is an option to purchase 4,000 shares at $30.00 per share. The options
vest and become exercisable in four equal installments of 1,000 shares beginning
six months after the date of grant and continuing at one-year intervals
thereafter. The 1997 options expire on April 27, 2007.
10
Aggregated Option Exercises in Last Fiscal Year
and Fiscal Year-end Option Values
The following table sets forth the number of shares acquired by any of the
named persons upon exercise of stock options in 1997, the value realized through
the exercise of such options, and the number of unexercised options held by such
person, including both those which are presently exercisable, and those which
are not presently exercisable.
Shares Number of
Acquired Shares Underlying Value of Unexercised
Upon Unexercised In-the-
Option Value Options Money Options
Name Exercise(#) Realized($) at 12-31-97(#)(1) at 12-31-97($)(2)
---- ----------- ----------- ----------------- -----------------
Not Not
Exercisable Exercisable Exercisable Exercisable
----------- ----------- ----------- -----------
Harris H. Simmons -- -- 30,000 70,000 1,015,000 1,508,125
A. Scott Anderson -- -- 17,500 36,500 592,719 795,656
John J. Gisi 14,400 406,908 37,148 54,652 1,393,690 1,585,738
W. David Hemingway 16,000 546,125 21,844 44,156 787,479 1,258,178
Dale M. Gibbons -- -- 2,000 18,000 46,625 312,375
- ----------------
(1) Of the shares shown as underlying unexercised options for Mr. Gisi, a
total of 14,400 exercisable and 14,400 unexercisable represent options
received in exchange for options of National Bancorp of Arizona, Inc.
upon its acquisition by the Company.
(2) Potential unrealized value is (i) the fair market value at fiscal
1997 year-end ($45.375) less the option exercise price, times (ii)
the number of shares.
Long-term Incentive Plan Awards in Fiscal 1997
The following table sets forth certain information regarding awards made in
1997 pursuant to the Company's Senior Management Value-Sharing Plan, which is a
deferred bonus plan intended to encourage the creation of long-term shareholder
value and promote teamwork among subsidiaries and divisions. The plan was
established in 1991 by the Board of Directors upon the recommendation of the
Compensation Committee. Members of senior management are granted units of
participation in each annual award fund. Payouts under the plan are determined
by allocating the award fund among the holders of units of participation in
proportion to the number of units held by the participant. The size of each
award fund is determined according to a formula which uses the Company's
aggregate earnings per share ("EPS") over the award period, with an adjustment
based upon the Company's average return on equity ("ROE") over the same period.
Both the aggregate EPS and average ROE numbers are adjusted to exclude the
effects of goodwill and certain merger-related expenses. Relatively higher
levels of EPS and ROE will make the award fund larger. An additional award fund
is proposed to be established each year, although future awards are subject to
the discretion of the Compensation Committee and the Board of Directors. Such
award funds have been established annually since the plan's inception.
11
The award fund established in 1997 is to range in amount from $0 for an
adjusted EPS growth rate of less than 5% annually over the four years beginning
in 1997, to a maximum of $10,006,000, corresponding to an adjusted EPS growth
rate of 25% annually for such period. The award fund will then be adjusted by a
factor determined by the average adjusted ROE for the period. If the average
adjusted ROE is less than 14%, the award adjustment factor will be 0, and there
will be no amounts paid under the plan. If the average adjusted ROE is between
14% and 17%, the factor will be 1. The award adjustment factor will increase to
a maximum of 1.33 at average adjusted ROE levels of 22% and above. Accordingly,
the maximum aggregate of all payments possible under the 1997 award fund is
$13,308,000. Adjustments are to be made for stock splits, stock dividends and
other changes to the Company's capitalization.
Each member of senior management designated by the Compensation Committee
to participate in the award fund established for a given period has been awarded
a number of performance units in the plan. The following table sets forth
estimated future payouts for the named individuals under the award fund
established in 1997 based on the following assumptions, respectively: the
threshold amount represents the minimum amount payable under the plan ($0);
Example #1 represents the amount that would be paid if the Company's adjusted
EPS annual growth rate during the period is 13% (as to which there can be no
assurance) and the average adjusted ROE is 17% (also as to which there can be no
assurance); Example #2 represents the amount that would be paid if the Company's
adjusted EPS annual growth rate during the period is 16% (as to which there can
be no assurance) and the average adjusted ROE is be 20% (also as to which there
can be no assurance); the maximum amount represents the maximum possible amount
payable to the named individuals from the award fund established in 1997.
Estimated Future Payout
of Value Sharing Plan
------------------------------------
Number of Performance Example Example
Performance Period Until Threshold #1 #2 Maximum
Name Units Payout ($) ($) ($) ($)
- ---- ----- ------ --- ------- ------- -------
Harris H. Simmons 9,750 4 Years 0 168,938 304,268 865,020
A. Scott Anderson 6,900 4 Years 0 108,294 195,044 554,500
John J. Gisi 6,250 4 Years 0 119,556 215,328 612,168
W. David Hemingway 6,500 4 Years 0 112,626 202,846 576,680
Dale M. Gibbons 6,500 4 Years 0 112,626 202,846 576,680
Retirement Plan
The Company's retirement plan covers substantially all full-time
employees who have five years or more of service with the Company. The
retirement plan is a cash balance defined benefit plan. It provides a lump sum
at retirement for participating employees according to a formula which takes
into account an employee's age and annual compensation. Compensation for these
purposes includes salary, bonuses and payouts under incentive plans.
For each year of credited service, cash balance pay credits are equal
to the participant's earnings multiplied by the applicable pay credit percentage
shown in the chart below. Annual interest credits are based on the GATT 30-year
bond rate (6.48% for 1997).
12
AGE PAY CREDIT
Less than 30 2.25%
30-39 3%
40-49 4%
50-54 5.25%
55-59 7%
60 or over 9.25%
The maximum benefits payable pursuant to the Company's retirement plan are
limited by Sections 415 and 401(a)(17) of the Internal Revenue Code of 1986, as
amended. Under current regulations, earnings for the purpose of determining
benefits cannot exceed $160,000. Effective January 1, 1994, the Company adopted
its Executive Management Pension Plan, which is a supplemental executive
retirement plan (SERP), to restore pension benefits limited by the Code sections
referred to above. The SERP is an unfunded, nonqualified plan under which
benefits are paid from the Company's general assets. The Board of Directors
determines the participants in the SERP from among those employees of the
Company who are or have been, on or after the effective date of the SERP,
members of the Company's Executive Management Committee and who (1) are employed
in a management position with the Company having principal responsibility for
the management, direction and success of the Company as a whole or a particular
business unit thereof, or (2) are highly compensated employees of the Company
within the meaning of ERISA Section 401. Each of the named individuals is a
participant in the SERP.
The following table illustrates the estimated annual benefits and
equivalent Lump Sum Cash Balance payable under the plan at age 65 based on a
combination of the basic pension plan and the SERP. Estimated annual pension and
lump sum cash balance amounts at age 65 assume the following: 1) a 7% annuity
rate to convert the estimated age 65 cash balance to an annual amount; 2) the
November 1997 treasury bill rate of 6.11% used to calculate all years' interest
on the Cash Balance; 3) 1997 compensation increasing by 4% per year to age 65.
Estimated Estimated
Cash Balance Annual
at Age 65 Benefit
--------- -------
Harris H. Simmons $3,629,739 $343,853
A. Scott Anderson 1,133,980 107,424
John J. Gisi 539,336 51,093
W. David Hemingway 1,294,939 122,672
Dale M. Gibbons 1,150,390 108,979
13
PERFORMANCE GRAPH FOR ZIONS BANCORPORATION
INDEXED COMPARISON OF 5-YEAR CUMULATIVE TOTAL RETURN
1992 1993 1994 1995 1996 1997
---- ---- ---- ---- ---- ----
S & P 500 100.00 109.92 111.34 152.66 187.28 249.28
KBW 50 Index 100.00 105.54 100.16 160.41 226.91 331.73
Zions Bancorporation 100.00 99.95 100.04 227.72 298.69 527.93
Note: Assumes $100 invested on 12-31-92 in Zions Bancorporation, the S&P 500
stock market index and Keefe, Bruyette & Woods (KBW) 50 bank stock
index. Assumes reinvestment of dividends on a quarterly basis.
ZIONS BANCORPORATION
RETURN ON AVERAGE EQUITY
PERCENTAGE
1993 20.33%
1994 18.82%
1995 20.22%
1996 28.95%
1997 19.88%
14
COMPENSATION COMMITTEE REPORT
Summary of Compensation Policies for Executive Officers
The Executive Compensation Committee (the "Compensation Committee") of the Board
of Directors has furnished the following report on executive compensation:
Under the supervision of the Compensation Committee, the Company has
developed and implemented compensation policies, plans and programs which
attempt to enhance the profitability of the Company, and thus shareholder value,
by aligning closely the financial interests of the Company's senior managers
with those of its shareholders. For the Company, earnings per share growth and
return on average shareholders' equity are critical elements in the
establishment of long-term incentive programs. Due to the Company's relatively
modest compensation structure, the Compensation Committee has not adopted a
policy regarding the federal tax deductibility of certain executive
compensation. The process involved in the executive compensation determination
for fiscal 1997 is summarized below:
o Compensation for each of the persons named in the Summary Compensation
Table, as well as other senior executives, consists of a base salary, an
annual bonus and long-term incentive compensation. Long-term incentives
consist primarily of annual grants of units of participation under the
Company's Senior Management Value-Sharing Plan (the "Value-Sharing Plan"),
supplemented by grants of Incentive Stock Options. The Value-Sharing Plan
is closely tied to Company performance as measured by earnings per share
and return on shareholders' equity. See "Long-term Incentive Plan Awards in
Fiscal 1997."
o The Compensation Committee determines base salaries and annual bonuses
after a subjective evaluation of various factors, including salaries paid
to senior managers with comparable qualifications, experience and
responsibilities at other institutions, individual job performance, local
market conditions and the Committee's perception of the overall financial
performance of the Company (particularly operating results), without
considering specific performance targets or objectives, and without
assigning particular weight to individual factors. As to executive officers
other than the chief executive officer, the Compensation Committee also
considers the recommendations made by the chief executive officer.
o Information regarding salaries paid by other financial institutions is
provided annually through an independent survey, and normally every three
years by an independent consultant (most recently for 1996). The consultant
compares the Company's compensation levels with a peer group of financial
institutions selected by asset size from the consultant's database. In its
most recent study, the consultant selected 23 institutions with asset sizes
ranging from $2.5 billion to $20.1 billion. Zions ranked in the 43rd
percentile among the peer group in terms of asset size. The study
indicated, based on a regression analysis, that the base and annual bonus
compensation in total for the Company's chief executive officer and the
other executive officers was somewhat below the median total compensation
level for the peer group as adjusted for institution size. This peer group
is not the same peer group used in the Performance Graphs.
15
o Units of participation in the Value-Sharing Plan's award funds are
granted on a discretionary basis, in a laddered structure reflecting the
position and proportionate responsibility for overall corporate results of
each executive officer in the Company. The allocation of units is not based
on any measure of Company performance, but is based on a subjective
evaluation of individual performance and the scope of individual
responsibilities. The Committee reviewed and approved the Value-Sharing
Plan's target levels of earnings per share and return on equity for the
1997 award fund as well as the corresponding variation in size of the award
fund. In 1997, as in every year since the Value-Sharing Plan was first
adopted, the Company's adjusted aggregate EPS and adjusted average ROE have
been within ranges which, if continued throughout the applicable four-year
period covered by each award fund, would provide payouts under the plan. A
payout occurred under the Value-Sharing Plan in 1997. (See "Summary
Compensation Table," n.7.) The Company's consultant has reported that in
comparison to the peer group selected by the consultant, the Company's
compensation package, for the Executive Officers as a group, provides
proportionately less compensation through salary and bonus, and an
appropriately competitive level of long-term incentive compensation,
consisting of the Value-Sharing Plan and incentive stock options.
Consultant reports are merely one factor taken into consideration by the
Committee in the process of making an independent and subjective
determination as to compensation.
o The Compensation Committee reviews the salary of the chief executive
officer and compares it to those in peer positions in companies of similar
size and performance levels, using information obtained through the
Company's independent compensation consultant concerning salary
competitiveness, and extrapolating from information obtained in previous
years when no survey has been conducted for the latest year. The
Compensation Committee establishes the chief executive officer's base
salary and annual bonus based on the Compensation Committee's subjective
assessment of the chief executive officer's past performance, its
expectation as to his future contributions in leading the Company, and the
information provided by the compensation consultant. A similar process is
used by the Compensation Committee to determine the number of units of
participation the chief executive officer receives in the Value-Sharing
Plan.
o The Company periodically grants incentive stock options to
executives. Grants were made in March 1997. Such grants are discretionary
with the Compensation Committee, and are typically made in a laddered
structure reflecting the position of each executive officer in the Company
and that person's proportionate responsibility for overall corporate
performance. Typically, the chief executive officer recommends the quantity
and terms of options to be granted to the executive officers other than to
himself. The allocation of stock options among executive officers is not
based on any measure of Company performance, but is based on a subjective
evaluation of individual performance and the scope of the individual's
responsibilities. Information regarding the quantity and terms of stock
options granted by other financial institutions has been provided by the
Company's independent consultant with respect to the peer group selected by
the consultant.
Executive Compensation Committee
Jerry C. Atkin, Chairman
Richard H. Madsen
Roger B. Porter
16
Compensation Committee Interlocks and Insider Participation
None
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
Certain directors and officers and/or their affiliates borrow from time
to time from Zions First National Bank and other subsidiaries of the Company, at
regular rates and terms, and are subject to all rules and regulations applicable
to banks. Aggregate loans to the directors, executive officers and principal
shareholders of the Company in excess of $60,000 to any such persons as of
December 31, 1997, comprised less than 2% of total shareholders' equity of the
Company. Such borrowings were made in the ordinary course of business, do not
involve more-than-normal risks of collectibility, and are made on terms
comparable to borrowings by others of similar credit risk.
In September 1993, the Company acquired National Bancorp of Arizona,
Inc. ("NBA"). As part of the acquisition of NBA by the Company, the Company
agreed to convert all options for the purchase of NBA common stock into options
for purchase of common stock of the Company. At the time of the NBA acquisition,
John J. Gisi held an option for the purchase of 100,000 shares of NBA common
stock (the "NBA Option"). Pursuant to a Stock Option Agreement between the
Company and Mr. Gisi, the NBA Option was replaced by an option entitling Mr.
Gisi to purchase up to 45,000 shares of the Company (the "New Option"). During
1997, 1996 and 1995, Mr. Gisi exercised certain of the New Options which
resulted in Mr. Gisi recognizing $406,908, $909,824 and $807,632 of
non-qualified stock option income.
In November 1997, the Company acquired GB Bancorporation ("GB"). As of that
date there were 2,165,036 shares of GB common stock outstanding. Zions owned
98,000 shares, or approximately 4.5% of the outstanding shares of GB common
stock. At acquisition, these shares were converted into 222,930 shares of Zions
Bancorporation common stock and retired. Simmons One, LC owned 198,000 shares,
or approximately 9.2%, of the outstanding shares of GB common stock, which were
converted into 450,410 shares of Zions stock. Simmons One, LC, which has since
been dissolved, was owned by members of the Simmons family, including Harris H.
Simmons, L.E. Simmons and David Simmons. Harris H. Simmons is the President and
Chief Executive Officer and a director of Zions, and L.E. Simmons is a director
of Zions. David Simmons, the son of Chairman Roy W. Simmons and the brother of
Harris H. Simmons and L.E. Simmons, was a director of GB. Both Harris H. Simmons
and L.E. Simmons may be deemed to have beneficially owned the 98,000 shares of
GB common stock owned by Zions, but each disclaimed beneficial ownership of the
shares owned by Zions.
Robert G. Sarver, a director of Zions, was also the Chairman and Chief
Executive Officer of GB and at the time of the acquisition beneficially owned
363,000 shares, or approximately 16.8%, of the outstanding shares of GB common
stock which were converted into 825,752 shares of Zions stock. He may also have
been deemed to beneficially own the 98,000 shares owned by Zions. Robert G.
Sarver disclaimed beneficial ownership of the shares owned by Zions. Finally,
Gerald J. Dent, an Executive Vice President of Zions and John J. Gisi, a Senior
Vice President of Zions, owned 1,500 and 2,500 shares of GB common stock,
respectively, which converted to 3,412 and 5,687 shares of Zions stock,
respectively.
17
PROPOSAL TO APPROVE AN INCREASE IN THE NUMBER OF AUTHORIZED SHARES
OF CAPITAL STOCK OF THE COMPANY
(Proposal 2)
The authorized capital stock of the Company now consists of 103,000,000
shares divided into classes as follows: (1) 100,000,000 shares of Common Stock,
without par value, of which 69,053,648 are outstanding as of the record date,
(2) 3,000,000 shares of preferred stock, without par value, none of which are
outstanding as of the record date.
The Board of Directors believes it would be in the best interests of
the Company and its shareholders to amend the Articles of Incorporation to
increase the authorized capital stock from 103,000,000 shares without par value
to 203,000,000 shares divided into 200,000,000 shares of Common Stock without
par value, and 3,000,000 shares of Preferred Stock without par value. To effect
this change, Article VIII of the Articles of Incorporation would be amended to
read in its entirety as follows:
ARTICLE VIII
The aggregate number of shares of capital stock which
this corporation shall have authority to issue is 203,000,000, divided
into two classes as follows:
(1) 200,000,000 shares of Common Stock, without par value, which
shares shall be entitled to one vote per share.
(2) 3,000,000 shares of Preferred Stock, without par value.
The Board of Directors of this corporation is expressly vested
with the authority to determine, with respect to any class of Preferred
Stock, the dividend rights (including rights as to cumulative,
noncumulative or partially cumulative dividends) and preferences,
dividend rate, conversion rights, voting rights, rights and terms or
redemption (including sinking fund provisions), redemption price or
prices, and the liquidation preferences of any such class of Preferred
Stock. As to any series of Preferred Stock, the Board of Directors is
authorized to determine the number of shares constituting such series,
and to increase or decrease (but not below the number of shares of such
series then outstanding) the number of shares of that series.
The Board of Directors of this corporation is expressly vested
with the authority to divide the above-described class of Preferred
Stock into series and to fix and determine the variations in the
relative rights and preferences of the shares of Preferred Stock of any
series so established, including, without limitation, the following:
(i) the rate of dividend;
(ii) the price at and the terms and conditions on which shares
may be redeemed;
(iii) the amount payable upon shares in event of involuntary
liquidation;
(iv) the amount payable upon shares in event of voluntary
liquidation;
(v) sinking fund provisions for the redemption or purchase of
shares;
18
(vi) the terms and conditions on which shares may be converted,
if the shares of any series are issued with the privilege
of conversion; and
(vii) such other variations in the relative rights and
preferences of such shares which at the time of the
establishment of such series are not prohibited by law.
The only change effected in Article VIII by the proposed amendment will
be to increase the authorized shares of capital stock from 103,000,000 to
203,000,000 and accordingly increase the authorization shares of Common Stock
from 100,000,000 to 200,000,000. The remaining text of Article VIII as set forth
above is unchanged from the text as presently in effect.
The Board of Directors is proposing to increase the authorized Common
Stock to afford the Board of Directors flexibility in responding promptly to
future financing requirements of the Company, including, without limitation,
splitting of the common stock, acquisitions of other businesses for shares of
capital stock on the most favorable terms as opportunities may arise from time
to time in the future, the raising of additional capital, and issuance pursuant
to stock option or other employee benefit or incentive compensation plans. If
authorization of any increase in the capital stock is postponed until a specific
need arises, the delay and expense incident to obtaining the approval of
stockholders at that time could impair the Company's ability to meet its
objectives. The Company has no immediate need for additional authorized common
shares. There is no present intention to issue any of the Preferred Stock.
If the proposed amendment is approved, the additional shares of capital
stock would be generally available for issuance without further action by the
shareholders. The additional shares of Common Stock issued hereafter would be
identical to the Common Stock currently outstanding. No stockholder has any
preemptive rights, and issuance of the additional Common Stock could dilute the
voting rights of present holders of Common Stock. It is possible, depending upon
the transaction in which either Common Stock or Preferred Stock is issued, that
issuance of such capital stock could have a dilutive effect on shareholders'
equity and earnings per share attributable to present holders.
The Board of Directors could issue the additional (as well as the
existing authorized but unissued) capital stock to impede any unsolicited bid
for control of the Company which the Board believed was not in the best
interests of the Company and its stockholders. The availability of the
additional capital stock as a defensive response to a takeover attempt was not a
motivating factor in the Board's approval of the proposed amendment to Article
VIII, and the Board is not aware of any effort to obtain control of the Company.
The affirmative vote of a majority of the outstanding Common Stock is
required for approval of the proposed amendment to Article VIII.
The Board of Directors recommends that stockholders vote FOR the
proposed amendments of Article VIII of the Restated Articles of Incorporation to
increase the number of authorized shares of Common Stock.
19
PROPOSAL TO AMEND THE ZIONS BANCORPORATION
KEY EMPLOYEE INCENTIVE STOCK OPTION PLAN
(Proposal 3)
The Company's Key Employee Incentive Stock Option Plan (the "Plan"),
was adopted on December 28, 1981, by the Board of Directors of the Company and
approved on April 28, 1982, by the shareholders of the Company. The Plan was
amended by the Company's shareholders on April 27, 1990, and April 28, 1995. The
proposed amendment to the Plan would automatically make available for options
under the Plan, in any one calendar year, one percent (1%) of the issued and
outstanding shares of the Company's common stock as of the first day of each
calendar year for which the Plan is in effect. Any shares of common stock
available in any year using the one percent (1%) formula that are not granted
under the Plan will be available for use under the terms of the Plan in
subsequent years. The common stock available for issuance under the Plan
pursuant to the one percent (1%) per year formula will not include common stock
which the Company is now or may become obligated to issue as a result of an
acquisition, merger or reorganization involving the Company. The exact wording
of the proposed amendment is set forth below.
The purpose of the Plan is to promote the long-term success of the
Company by providing financial incentives to key employees of the Company and
its subsidiaries who are in positions to make significant contributions toward
such success. The Plan is designed to attract individuals of outstanding ability
to employment with the Company or a subsidiary and to encourage key employees to
acquire a proprietary interest in the Company, to continue employment with the
Company or a subsidiary, and to render superior performance during such
employment.
The Plan will expire on March 3, 2005, unless extended by approval of
the shareholders. Currently, the aggregate number of common shares with respect
to which options can be granted under the Plan cannot exceed 3,224,000 shares
(after adjusting for the 4 to 1 stock split which occurred in 1997).
The Board of Directors believes it would be in the best interests of
the Company and its shareholders to amend the Plan to provide for automatic
increases in the aggregate number of shares available under the Plan. The
amendment will allow the Plan to grow along with the growth of the Company and
insure that the Company has sufficient stock available under the Plan to meet
the stated purposes of the Plan.
It is proposed that Paragraph 1.3(a) of the Plan be amended to read in
its entirety as follows:
1.3 Aggregate Limitation
(a) The aggregate number of shares of Common Stock with
respect to which Incentive Stock Options may be
granted under this Plan on an annual basis shall
not exceed one percent (1%) of the issued and
outstanding shares of Common Stock as of the first
day of each calendar year for which the Plan is in
effect, subject to adjustment in accordance with
Section 3.1. Any shares available in any year
using this formula that are not granted under this
Plan will be available for use in subsequent years.
20
The Board of Directors recommends that the shareholders vote FOR the
above proposal.
RELATIONSHIP WITH INDEPENDENT AUDITORS
(Proposal 4)
KPMG Peat Marwick LLP, Certified Public Accountants, has served as
independent auditor for the Company and its subsidiaries since 1965.
Representatives of KPMG Peat Marwick LLP are expected to be present at the
Annual Meeting of Shareholders, and will have the opportunity to make a
statement, if they desire to do so, and will be available to respond to
appropriate questions.
The Board of Directors, upon the recommendation of the Audit Committee,
has appointed KPMG Peat Marwick LLP as the firm of independent certified public
accountants to audit the books and accounts of the Company and its subsidiaries
for the year to end December 31, 1998, subject to ratification by the
shareholders.
The Board of Directors recommends that the shareholders vote FOR the
above proposal.
OTHER BUSINESS
(Proposal 5)
Except as set forth herein, management has no knowledge of any business
to come before the meeting. If, however, any other matters of which management
is now unaware properly come before this meeting, it is the intention of the
persons named in the Proxy to vote the Proxy in accordance with their judgment
on such matters.
DATE OF SUBMISSION OF SHAREHOLDER PROPOSALS
FOR 1999 SHAREHOLDERS' MEETING
The date by which shareholders' proposals must be submitted to the
Company for inclusion in the Proxy Statement for the 1999 Shareholders' Meeting
is December 15, 1998.
21
THE COMPANY WILL PROVIDE WITHOUT CHARGE TO EACH SHAREHOLDER, ON WRITTEN REQUEST,
A COPY OF THE COMPANY'S ANNUAL REPORT ON FORM 10-K FOR 1997, INCLUDING THE
FINANCIAL STATEMENTS AND SCHEDULES THERETO, AS FILED WITH THE SECURITIES AND
EXCHANGE COMMISSION. WRITTEN REQUESTS FOR SUCH INFORMATION SHOULD BE DIRECTED TO
THE CORPORATE SECRETARY, ONE SOUTH MAIN, SUITE 1380, SALT LAKE CITY, UTAH 84111.
ZIONS BANCORPORATION - ONE SOUTH MAIN, SUITE 1380 - SALT LAKE CITY, UTAH 84111
(801) 524-4787
22
ZIONS BANCORPORATION
SOLICITED ON BEHALF OF
PROXY THE BOARD OF DIRECTORS
The undersigned hereby appoints A. SCOTT ANDERSON, DALE M. GIBBONS and W.
DAVID HEMINGWAY or any of them with full power of substitution, the lawful
attorneys and proxies of the undersigned, to vote all of the shares held by the
undersigned in Zions Bancorporaiton at the Annual Shareholders' Meeting to be
held on April 24, 1998 and at all adjournments thereof upon the matters listed
below.
1. To elect Directors
All nominees listed below (except as marked to the contrary)
FOR / / WITHHOLD AUTHORITY / /
INSTRUCTION: to withhold authority for any individual, cross a line through
the nominee's name in the list below:
Roger B. Porter L.E. Simmons I.J. Wagner
2. To approve the increase in the number of authorized shares of Capital
Stock of the Company.
FOR / / AGAINST / / ABSTAIN / /
3. To approve the amendment to the Zions Bancorporation Key Employee
Incentive Stock Option Plan.
FOR / / AGAINST / / ABSTAIN / /
4. To approve the appointment of KPMG Peat Marwick LLP as independent auditors
for the year 1998.
FOR / / AGAINST / / ABSTAIN / /
5. To transact any other business as may properly come before the meeting.
AUTHORITY / / WITHHOLD AUTHORITY / /
UNLESS A CONTRARY CHOICE IS SPECIFIED, THIS PROXY WILL BE VOTED FOR THE
ELECTION OF DIRECTORS, IN FAVOR OF PROPOSALS 2, 3 and 4, and OTHERWISE IN THE
DISCRETION OF ANY OF THE APPOINTEES AS PROXIES.
-----------------------------
Dated ____________, 1998. -----------------------------
Please sign exactly as name
appears on reverse side.