SUNTRUST BANKS, INC. PERFORMANCE UNIT PLAN
Amended and Restated as of January 4, 1995
Section 1. Name and Purpose
The name of this Plan is the SunTrust Banks, Inc. Performance Unit Plan.
The purpose of the Plan is to promote the long-term interests of the
Corporation and its stockholders through the granting of Performance Units to
key executive employees of the Corporation and its Subsidiaries in order to
motivate and retain superior executives who contribute in a significant
manner to the actual financial performance of the Corporation as measured
against a pre-established goal for the Corporation's profits.
Section 2. Effective Date, Term and Amendments
The effective date of the amended and restated Plan shall be November 8,
1994, and the amended and restated Plan shall apply to all awards granted on
or after such date. The Plan shall continue for an indefinite term until
terminated by the Board; provided, however, that the Corporation and the
Committee after such termination shall continue to have full administrative
power to take any and all action contemplated by the Plan which is necessary
or desirable and to make payment of any awards earned by Participants during
any then unexpired Performance Measurement Cycle. The Board or the Committee
may amend the Plan in any respect from time to time. The Plan as in effect
on November 7, 1994 shall continue in effect for awards granted on or before
such date.
Section 3. Definitions and Construction
A. As used in this Plan, the following terms shall have the meanings
indicated, unless the context clearly requires another meaning:
1. "Board" means the Board of Directors of the Corporation.
2. "Calendar Year Report" means the report prepared for each calendar
year by the Controller's office of the Corporation entitled "SunTrust Banks,
Inc. Contribution to Consolidated Net Income for the Calendar Year", which is
prepared in accordance with generally accepted accounting principles, or any
successor to such report.
3. "Code" means the Internal Revenue Code of 1986, as amended.
4. "Committee" means the Compensation Committee of the Board or any
other Committee of the Board to which the responsibility to administer this
Plan is delegated by the Board; such Committee shall consist of at least two
members of the Board, who shall not be eligible to receive an award under the
Plan and each of whom shall be a "disinterested" person within the meaning of
Rule 16b-3 under the Securities Exchange Act of 1934, and shall be or be
treated as an "outside director" for purposes of Section 162(m) of the Code.
5. "Corporation" means SunTrust Banks, Inc. and any successor thereto.
6. "Covered Employee" means for each calendar year the Chief Executive
Officer and the four other executive officers whose compensation would be
reportable on the "summary compensation table" under the Securities and
Exchange Commission's executive compensation disclosure rules, as set forth
in Item 402 of Regulation S-K, 17 C.F.R. 229.402, under the Securities
Exchange Act of 1934, if the report was prepared as of the last day of such
calendar year.
7. "Change in Control" means a change in control of the Corporation of
a nature that would be required to be reported in response to Item 6(e) of
Schedule 14A of Regulation 14A promulgated under the Securities Exchange Act
of 1934 ("34 Act") as in effect on the effective date of this Plan, provided
that such a change in control shall be deemed to have occurred at such time
as (i) any "person" (as that term is used in Sections 13(d) and 14(d)(2) of
the 34 Act), is or becomes the beneficial owner (as defined in Rule 13d-3
under the 34 Act) directly or indirectly, of securities representing 20% or
more of the combined voting power for election of directors of the then
outstanding securities of the Corporation or any successor of the
Corporation; (ii) during any period of two consecutive years or less,
individuals who at the beginning of such period constitute the Board cease,
for any reason, to constitute at least a majority of the Board, unless the
election or nomination for election of each new director was approved by a
vote of at least two-thirds of the directors then still in office who were
directors at the beginning of the period; (iii) the shareholders of the
Corporation approve any merger, consolidation or share exchange as a result
of which the common stock of the Corporation shall be changed, converted or
exchanged (other than a merger with a wholly-owned subsidiary of the
Corporation) or any dissolution or liquidation of the Corporation or any sale
or the disposition of 50% or more of the assets or business of the
Corporation; or (iv) the shareholders of the Corporation approve any merger
or consolidation to which the Corporation is a party or a share exchange in
which the Corporation shall exchange its shares for shares of another
corporation as a result of which the persons who were shareholders of the
Corporation immediately prior to the effective date of the merger,
consolidation or share exchange shall have beneficial ownership of less than
50% of the combined voting power for election of directors of the surviving
corporation following the effective date of such merger, consolidation or
share exchange; provided, however, and notwithstanding the occurrence of any
of the events previously described in this definition, that no "change in
control" shall be deemed to have occurred under this definition if, prior to
such time as a "change in control" would otherwise be deemed to have occurred
under this definition, the Board determines otherwise.
8. "Earnings Per Share" means for each calendar year in each
Performance Measurement Cycle the primary earnings per common share of the
Corporation as set forth in the Calendar Year Report for each such year,
adjusted to exclude items which should be excluded as being extraordinary in
nature as determined by the Committee; provided, however, no such adjustment
shall be made with respect to a Covered Employee if the Committee determines
that such adjustment shall cause an award to such Covered Employee to fail to
qualify as "performance-based compensation" under Section 162(m) of the Code.
9. "Employment" means continuous employment with the Corporation or a
Subsidiary from the beginning to the end of each Performance Measurement
Cycle, which continuous employment shall not be considered to be interrupted
by transfers between the Corporation and a Subsidiary or between
Subsidiaries.
10. "Final Value" means the value of a Performance Unit determined in
accordance with Section 6 as the basis for payments to Participants at the
end of a Performance Measurement Cycle.
11. "Grant Value" means the initial value assigned to a Performance
Unit as determined by the Committee.
12. "Net Income" means the Corporation's consolidated net income for
each calendar year in each Performance Measurement Cycle (as set forth in the
Calendar Year Report for each such year), adjusted to exclude items which
should be excluded as being extraordinary in nature as determined by the
Committee; provided, however, no such adjustment shall be made with respect
to a Covered Employee if the Committee determines that such adjustment shall
cause an award to such Covered Employee to fail to qualify as "performance-
based compensation" under Section 162(m) of the Code.
13. "Participant" means any key executive employee of the Corporation
and/or its Subsidiaries who is selected by the Committee or the Committee's
delegate to participate in the Plan based upon the employee's substantial
contributions to the growth and profitability of the Corporation and/or its
Subsidiaries.
14. "Performance Goal" means the performance objective of the
Corporation which is established pursuant to Section 6 by the Committee for
each Performance Measurement Cycle as the basis for determining the Final
Value of a Performance Unit.
15. "Performance Measurement Cycle" shall mean a period of consecutive
calendar years as set by the Committee which commences on the first day of
the first calendar year in such period.
16. "Performance Unit" means a unit awarded to a Participant under the
Plan for a Performance Measurement Cycle, and each unit shall have an
assigned value for accounting purposes which shall be determined by the
Committee.
17. "Plan" means the SunTrust Banks, Inc. Performance Unit Plan as
amended and restated in this document and all amendments thereto.
18. "Proportionate Final Value" means the product of a fraction, the
numerator of which is the actual number of full months in a Performance
Measurement Cycle that an employee was a Participant in the Plan and the
denominator of which is the total number of months in that Performance
Measurement Cycle, multiplied by the Final Value of a Performance Unit.
19. "Subsidiary" means any bank, corporation or entity which the
Corporation controls either directly or indirectly through ownership of fifty
percent (50%) or more of the total combined voting power of all classes of
stock of such bank, corporation or entity, except for such direct or indirect
ownership by the Corporation while the Corporation or a Subsidiary is acting
in a fiduciary capacity with respect to any trust, probate estate,
conservatorship, guardianship or agency.
20. "Termination Value" means the value of a Performance Unit as
determined by the Committee, in its absolute discretion, upon the early
termination of a Performance Measurement Cycle or upon a Participant's
termination of Employment before the end of such a cycle, which value shall
be the basis for the payment of an award to a Participant, in accordance with
Sections 8(B), 8(C), 9(A) or 9(B) of the Plan based on the Participant's
Employment prior to his termination of Employment or the early termination of
such cycle.
B. In the construction of the Plan, the masculine shall include
the feminine and the singular shall include the plural in all instances in
which such meanings are appropriate. The Plan and all agreements executed
pursuant to the Plan shall be governed by the laws of Georgia.
Section 4. Committee Responsibilities
A. The Committee may, from time to time, adopt rules and
regulations and prescribe forms and procedures for carrying out the purposes
and provisions of the Plan. The Committee shall have the final authority to
select Participants and to designate the number of Performance Units to be
awarded to each Participant. The Committee shall have the sole and final
authority to determine awards, designate the periods for Performance
Measurement Cycles, assign Performance Unit values, determine Performance
Goals, and answer all questions arising under the Plan, including questions
on the proper construction and interpretation of the Plan. Any
interpretation, decision or determination made by the Committee shall be
final, binding and conclusive upon all interested parties, including the
Corporation and its Subsidiaries, Participants and other employees of the
Corporation or any Subsidiary, and the successors, heirs and representatives
of all such persons. The Committee shall use its best efforts to ensure that
awards to Covered Employees under the Plan qualify as "performance-based
compensation" for purposes of Section 162(m) of the Code.
B. Subject to the express provisions of the Plan and prior to the
beginning of a calendar year (or such later time as may be permitted for
awards paid for such year to be treated as performance-based compensation
under Section 162(m)), the Committee shall:
1. Designate the period of consecutive calendar years for each
Performance Measurement Cycle which shall begin on the first day of such
year.
2. Select the Participants for each such Performance Measurement
Cycle.
3. Establish the Performance Goals for each such Performance
Measurement Cycle.
4. Designate the number of Performance Units to be awarded to each
Participant.
5. Assign a Grant Value to each Performance Unit and establish the
method of calculating the Final Value of each Performance Unit.
6. Authorize management (a) to notify each Participant that he has
been selected as a Participant, inform him of the number of Performance Units
awarded to him and the Performance Goal that has been established for such
Performance Measurement Cycle and (b) to obtain from him such agreements and
powers and designations of beneficiaries as it shall reasonably deem
necessary for the administration of the Plan.
C. During any Performance Measurement Cycle, the Committee may if it
determines that it will promote the purpose of the Plan:
1. Select as additional Participants any key executive employees of
the Corporation and its Subsidiaries who have been hired, transferred or
promoted into a position eligible for participation in the Plan and may award
Performance Units to such Participants for such Performance Measurement
Cycle. The Performance Units awarded to any such Participant shall be
subject to the same restrictions, limitations, Performance Goals and other
conditions as those held by other Participants for the same Performance
Measurement Cycle and their participation may be made retroactive to the
first day of such cycle; provided, however, no Participant who is added will
be paid an award for any calendar year to the extent such payment, when added
to all his other compensation for such year, would be nondeductible under
Section 162(m) of the Code.
2. Revoke the designation of an individual as a Participant under the
Plan, revoke the grant to a Participant of Performance Units subject to an
award, if any, under a specific Performance Measurement Cycle and authorize
management to inform him in writing of such revocation.
D. The Committee may revise the Performance Goals for any Performance
Measurement Cycle to the extent the Committee, in the exercise of its
absolute discretion, believes necessary to achieve the purpose of the Plan in
light of any unexpected or unusual circumstances or events, including but not
limited to changes in accounting rules, accounting practices, tax laws and
regulations, or in the event of mergers, acquisitions, divestitures,
unanticipated increases in Federal Deposit Insurance premiums, and
extraordinary or unanticipated economic circumstances; provided, however, no
change will be effective for any Participant who at the time of payment of
the award is a Covered Employee, to the extent the Committee determines that
such change might make the amount of the award to such Participant
nondeductible under Section 162(m).
Section 5. Performance Units
The Committee shall determine the aggregate Grant Value (Grant Value
times the number of Performance Units) of the Performance Units awarded at
the date of grant to each Participant.
Section 6. Performance Goals
For each Performance Measurement Cycle, the Committee shall establish
one or more Performance Goals which shall determine individually or jointly
the Final Value of the Performance Units under each award for such cycle and
which shall be based on Net Income and/or Earnings Per Share. The Committee
shall fix a minimum Net Income objective and/or a minimum Earnings Per Share
objective for the cycle, and the Final Value of such units shall be equal to
zero if actual Net Income and/or actual Earnings Per Share fall below either
or both the minimum objectives, as established by the Committee. The
Committee shall also fix a maximum Net Income objective and/or Earnings Per
Share objective and such other Net Income and/or Earnings Per Share
objectives which fall between the minimum and maximum objectives as the
Committee shall deem appropriate, with corresponding Final Values for such
units. Awards will be determined based upon achieving or exceeding the
Performance Goals set by the Committee. Awards are determined by multiplying
each Participant's number of Performance Units by the Final Value. Straight
line interpolation will be used to calculate the awards when Net Income or
Earnings Per Share fall between any two specified Net Income or Earnings Per
Share objectives, as applicable. No individual may receive an award in
excess of $1 million for any Performance Measurement Cycle.
Section 7. Payment of an Award
A. Upon completion of each Performance Measurement Cycle, the
Committee, or such persons as the Committee shall designate, shall determine
in accordance with Section 6 the extent to which the Performance Goals have
been achieved and authorize the cash payment of an award, if any, to each
Participant. Each award shall equal the Final Value of the Performance Units
times the number of the Performance Units awarded. The Committee shall
review and ratify the award determinations and shall certify such award
determinations in writing. Payment of awards shall be made as soon as
practical after the certification of awards by the Committee. Each award
shall be paid in cash after deducting the amount of applicable Federal,
State, or Local withholding taxes of any kind required by law to be withheld
by the Corporation. All awards, whether paid currently or paid under any
plan which defers payment, shall be payable out of the Corporation's general
assets. Each Participant's claim, if any, for the payment of an award,
whether made currently or made under any plan which defers payment, shall not
be superior to that of any general and unsecured creditor of the Corporation.
If an error or omission is discovered in any of the determinations, the
Committee shall cause an appropriate equitable adjustment to be made in order
to remedy such error or omission.
B. Notwithstanding the terms of any award, the Committee in its sole
and absolute discretion, may reduce the amount of the award payable to any
Participant for any reason, including the Committee's judgment that the
Performance Goals have become an inappropriate measure of achievement, a
change in the employment status, position or duties of the Participant,
unsatisfactory performance of the Participant, or the Participant's service
for less than the Performance Measurement Cycle.
C. In accordance with the procedures set forth in the SunTrust Banks,
Inc.'s Performance Unit Plan Deferred Compensation Fund, a Participant may
elect to defer receipt of one hundred (100%) percent of the Final Value of
his award, if any, for each Performance Measurement Cycle or fifty (50%)
percent of said amount, rounded to the nearest One Hundred ($100.00) Dollars,
and the amount so deferred shall be credited by the Corporation to the
Participant's Fund Accounts established under such Fund.
Section 8. Participation for Less than a Full Performance Measurement Cycle
A. Except as otherwise provided in this Section 8, Performance
Units awarded to a Participant shall be forfeited if the Participant's
Employment terminates during any Performance Measurement Cycle and no
payments shall be due the Participant for any forfeited Performance Units.
B. If a Participant's Employment terminates prior to the end of
any Performance Measurement Cycle on account of his death, the Committee
shall waive the Employment condition and shall authorize the payment of an
award to such Participant at the end of such cycle based on the Proportionate
Final Value, if any, of his Performance Units, unless the Committee in its
discretion feels the award should be forfeited.
C. If a Participant's Employment terminates prior to the end of any
Performance Measurement Cycle on account of disability under a long-term
disability plan maintained by the Corporation or a Subsidiary, the Committee
shall waive the Employment condition and shall authorize, as of commencement
of disability benefits to such Participant, the payment of an award to such
Participant at the end of such cycle based on the Proportionate Final Value,
if any, of his Performance Units, unless the Committee in its discretion
feels the award should be forfeited.
D. If a Participant's Employment terminates prior to the end of
any Performance Measurement Cycle on account of his early or normal
retirement under any pension plan maintained by the Corporation or any
Subsidiary, the Committee
shall waive the Employment condition and shall authorize the payment of an
award to such Participant at the end of such cycle based on the Proportionate
Final Value, if any, of his Performance Units, unless the Committee in its
discretion feels the award should be forfeited.
Section 9. Premature Satisfaction of Plan Conditions
A. In the event of a Change in Control of the Corporation prior
to the end of any Performance Measurement Cycle, the Committee shall waive
any and all Plan conditions and authorize the payment of an award immediately
to each Participant based on the Termination Value, if any, of his
Performance Units.
B. If a tender or exchange offer is made other than by the
Corporation for shares of the Corporation's stock prior to the end of any
Performance Measurement Cycle, the Committee may waive any and all Plan
conditions and authorize, at any time after the commencement of the tender or
exchange offer and within thirty (30) days following completion of such
tender or exchange offer, the payment of an award immediately to each
Participant based on the Termination Value, if any, of his Performance Units.
C. A Performance Measurement Cycle shall terminate upon the
Committee's authorization of the payment of an award during such cycle
pursuant to this Section 9 and no further payments shall be made for such
Cycle.
Section 10. Non-Transferabilitv of Rights and Interests
A. A Participant may not alienate, assign, transfer or otherwise
encumber his rights and interests under this Plan and any attempt to do so
shall be null and void.
B. In the event of a Participant's death and subject to the terms
of Section 8(B), the Committee shall authorize payment of any award due a
Participant to the Participant's designated beneficiary as specified or, in
the absence of such written designation or its ineffectiveness, then to his
estate. Any such designation may be revoked and a new beneficiary designated
by the Participant by written instrument delivered to the Committee.
Section 11. Limitation of Rights
Nothing in this Plan shall be construed to give any employee of the
Corporation or a Subsidiary any right to be selected as a Participant or to
receive an award or to be granted Performance Units other than as is provided
herein. Nothing in this Plan or any agreement executed pursuant hereto shall
be construed to limit in any way the right of the Corporation or a Subsidiary
to terminate a Participant's employment at any time, without regard to the
effect of such termination on any rights such Participant would otherwise
have under this Plan, or give any right to a Participant to remain employed
by the Corporation or a Subsidiary in any particular position or at any
particular rate of remuneration.
Section 12. Shareholder Approval
Notwithstanding anything in this Plan to the contrary, no awards shall
be paid to Covered Employees until such shareholder approval as is required
under Section 162(m) of the Code, if any, is obtained.
Executed this 4th day of January, 1995.
SUNTRUST BANKS, INC.
Attest: By:
Title: Title:
(CORPORATE SEAL)