SUNTRUST BANKS, INC. MANAGEMENT INCENTIVE PLAN
Amended and Restated as of January 4, 1995
Section 1. Name and Purpose
The name of this Plan is the SunTrust Banks, Inc. Management Incentive
Plan. The purpose of the Plan is to promote the interests of the Corporation
and its stockholders through the granting of Awards 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
pre-established goals 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 Plan Year. 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. "Award" means the right to receive a cash payment which represents
a percentage of a Participant's Base Wages determined by the Committee in
accordance with Section 5 hereof in the event the Corporation or a Subsidiary
achieves the Financial Goals established pursuant to Section 5.
2. "Base Wages" means the base salary paid to a Participant by the
Corporation or a Subsidiary during a Plan Year, excluding bonuses, overtime,
commissions and other extra compensation, reimbursed expenses and
contributions made by the Corporation or a Subsidiary to this or any other
employee benefit plan maintained by the Corporation or a Subsidiary.
3. "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.
4. "Code" means the Internal Revenue Code of 1986, as amended.
5. "Committee" shall mean 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.
6. "Corporation" means SunTrust Banks, Inc. and any successor thereto.
7. "Covered Employee" means for each calendar year the Chief Executive
Officer of the Corporation 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.
8. "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.
9. "Employment" means continuous employment with the Corporation or a
Subsidiary from the beginning to the end of each Plan Year, 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 an Award determined in accordance
with Sections 5 and 6 as the basis for payments to Participants at the end of
a Plan Year.
11. "Net Income" means for each calendar year the Corporation's
consolidated net income with respect to the Corporation (as set forth in the
Calendar Year Report for such year) and, with respect to each designated
Subsidiary, either its net income or certain components of its net income,
as specified by the Committee prior to the commencement of each Plan Year
(which net income or components thereof are as set forth in the Calendar Year
Report for 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.
12. "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 future growth and future profitability of the
Corporation and/or its Subsidiaries.
13. "Financial Goals" means the financial objectives of the Corporation
and its Subsidiaries which are established pursuant to Section 5 by the
Committee for each Plan Year prior to the beginning of each Plan 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)) as the basis
for determining the Final Value of the Award.
14. "Plan Year" means a single calendar year period as set by the
Committee which commences on the first day of such period.
15. "Plan" means the SunTrust Banks, Inc. Management Incentive Plan
as amended and restated in this document and all amendments thereto.
16. "Proportionate Final Value" means the product of a fraction, the
numerator of which is the actual number of full months in a Plan Year that an
employee was a Participant in the Plan and the denominator of which is the
total number of months in that Plan Year, multiplied by the Final Value of
an Award.
17. "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.
18. "Termination Value" means the value of an Award as determined by
the Committee, in its absolute discretion, upon the early termination of a
Plan Year or upon a Participant's termination of Employment before the end of
such Plan Year, which value shall be the basis for the payment of an Award to
a Participant, in accordance with Sections 7(B), 7(C), 8(A) or 8(B) of the
Plan based on the Participant's Employment prior to his termination of
Employment or the early termination of such Plan Year.
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 sole and final
authority to designate Participants, determine Awards, designate the Plan
Year, determine Financial Goals, determine Final Value of Awards, 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 Plan Year which shall begin on the first day of
such year.
2. Designate the Participants for each such Plan Year.
3. Establish the Financial Goals for the Corporation and designated
Subsidiaries for each such Plan Year.
4. Establish the method of calculating the Final Value of each Award.
5. Authorize management (a) to notify each Participant that he has
been selected as a Participant, inform him of the Financial Goal that has
been established for such Plan Year 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 Plan Year, the Committee may, if it determines that it
will promote the purpose of the Plan, designate 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. The individual's designation as a Participant
shall be subject to the same restrictions, limitations, Financial Goals and
other conditions as those held by other Participants for the same Plan Year
and their participation may be made retroactive to the first day of such Plan
Year; 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.
D. During any Plan Year, the Committee may, if it determines it will
promote the purpose of the Plan, revoke the Committee's prior designation of
a key executive employee as a Participant under the Plan for a Plan Year.
E. The Committee may revise the Financial Goals for any Plan Year 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. Financial Goals
For each Plan Year, the Committee shall establish separate Financial
Goals for the Corporation and each of the Subsidiaries based on each such
organization's Net Income which shall then determine the Final Value of each
Award as a specified percent of the Participant's Base Wages based on the
attainment by the Participant's employer of such goals for the Plan Year.
With respect to the Corporation and each Subsidiary, the Committee shall fix
a minimum Net Income objective for the Plan Year, and the Final Value of such
Awards shall be equal to zero if actual Net Income falls below the minimum
Net Income objective of the Corporation or, where appropriate, such
Subsidiary. The Committee shall also fix a maximum Net Income objective and
such other Net Income objectives which fall between the maximum and minimum
Net Income objectives as the Committee shall deem appropriate, with
corresponding Final Values for such Awards with respect to the Corporation
and each Subsidiary. Awards will be determined based upon achieving or
exceeding the Financial Goals set by the Committee. Straight line
interpolation will be used to calculate Awards when Net Income falls between
any two specified Net Income objectives. No Participant may receive an
Award in excess of $1 million for any given Plan Year.
Section 6. Payment of an Award
A. Promptly after the date on which the necessary information for a
particular Plan Year becomes available, the Committee, or such persons as the
Committee shall designate, shall determine in accordance with Section 5 the
extent to which the Financial Goals have been achieved for such Plan Year and
authorize the cash payment of the Final Value of an Award, if any, to each
Participant. 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
Financial 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 entire Plan Year.
C. In accordance with the procedures set forth in the SunTrust Banks,
Inc.'s Management Incentive 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 Plan Year 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 7. Participation for Less Than a Full Plan Year
A. Except as otherwise provided in this Section 7, an Award to a
Participant shall be forfeited if the Participant's Employment terminates
during any Plan Year and no payment shall be due the Participant for any
forfeited Award.
B. If a Participant's Employment terminates prior to the end of any
Plan Year 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 Plan Year based on the Proportionate Final Value, if any, of
his Award, 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
Plan Year 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 Plan Year based on the Proportionate Final Value, if any, of
his Award, 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
Plan Year 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 Plan Year based on the Proportionate Final
Value, if any, of his Award, unless the Committee in its discretion feels the
Award should be forfeited.
Section 8. Premature Satisfaction of Plan Conditions
A. In the event of a Change in Control of the Corporation prior to
the end of any Plan Year, the Committee shall waive any and all Plan
conditions and shall authorize the payment of an Award immediately to each
Participant based on the Termination Value, if any, of his Award.
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 Plan Year, 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 Award.
C. A Plan Year shall terminate upon the Committee's authorization of
the payment of an Award during such Year pursuant to this Section 8 and no
further payments shall be made for such Year.
Section 9. Non-Transferability 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 7(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 effectiveness, 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 10. 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 an Award 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 11. 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.
Section 12. Miscellaneous.
In the event the Committee deems it in the best interest of the
Corporation to make Awards based on the performance of a division of either
the Corporation or a Subsidiary, or a combination of divisions of the
Corporation and/or Subsidiaries, the Committee shall have the authority to
adopt such rules, regulations and procedures for granting such Awards as it
deems appropriate, which rules, regulations and procedures shall be otherwise
consistent with the rules and procedures set forth in this Plan for granting
Awards based on the Financial Goals of the Corporation and its
Subsidiaries.
Executed this 4th day of Janaury, 1995.
(CORPORATE SEAL)
SUNTRUST BANKS, INC.
Attest: By:
Title: Title: