SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of
the Securities Exchange Act of 1934 (Amendment No. )
Filed by the Registrant |X|
Filed by a Party other than the Registrant |_|
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|_| Preliminary Proxy Statement
|_| Confidential, for Use of the Commission Only
(as permitted by Rule 14a-6(e)(2)
|X| Definitive Proxy Statement
|_| Definitive Additional Materials
|_| Soliciting Material Pursuant to ss.240.14a-11(c) or ss.240.14a-12
Mid-State Bancshares
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(Name of Registrant as Specified In Its Charter)
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(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
|X| No Fee Required
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1. Title of each class of securities to which transaction applies:
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2. Aggregate number of securities to which transaction applies:
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3. Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (set forth the amount on which
the filing fee is calculated and state how it was determined):
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|_| Check box if any part of the fee is offset as provided by Exchange Act
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the Form or Schedule and the date of its filing.
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[LOGO]
MID-STATE BANCSHARES
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NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
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To the Shareholders of Mid-State Bancshares:
NOTICE IS HEREBY GIVEN that, pursuant to its Bylaws and the call of its Board of
Directors, the Annual Meeting of Shareholders of Mid-State Bancshares
("Mid-State") will be held on Wednesday, May 16, 2001, at 7:30 p.m., California
Time, at the Cliffs Resort, 2757 Shell Beach Road, Shell Beach, California, (the
"Meeting") for the following purposes, as set forth in the attached Proxy
Statement:
1. To consider and vote upon a proposal to elect three (3) persons to the
Board of Directors of Mid-State to serve until the 2004 Annual Meeting of
Shareholders and until their successors have been elected and have
qualified.
2. To transact any other business which may properly come before the Meeting
or any adjournments or postponements thereof.
Only those shareholders of record at the close of business on March 30, 2001,
are entitled to notice of and to vote at the Meeting or any adjournments or
postponements thereof (the "Record Date").
Section 2.11 of the Mid-State bylaws provide for the nomination of directors as
follows:
"Nominations for election of members of the Board of Directors may be made by
the Board of Directors or by any shareholder of any outstanding class of capital
stock of the Corporation entitled to vote for the election of directors. Notice
of intention to make any nominations (other than for persons named in the notice
of the meeting at which such nomination is to be made) shall be made in writing
and shall be delivered or mailed to the president of the Corporation by the
later of the close of business 21 days prior to any meeting of shareholders
called for the election of directors or 10 days after the date of mailing of
notice of the meeting to shareholders. Such notification shall contain the
following information to the extent known to the notifying shareholder: (a) the
name and address of each proposed nominee; (b) the principal occupation of each
proposed nominee; (c) the number of shares of capital stock of the corporation
owned by each proposed nominee; (d) the name and residence address of the
notifying shareholder; (e) the number of shares of capital stock of the proposed
nominee, a copy of which shall be furnished
with the notification, whether the proposed nominee has ever been convicted of
or pleaded nolo contendere to any criminal offense involving dishonesty or
breach of trust, filed a petition in bankruptcy, or been adjudged bankrupt. The
notice shall be signed by the nominating shareholder and by the nominee.
Nominations not made in accordance herewith shall be disregarded by the chairman
of the meeting, and upon his instructions, the inspectors of election shall
disregard all votes cast for each such nominee. The restrictions set forth in
this paragraph shall not apply to nomination of a person to replace a proposed
nominee who has died or otherwise become incapacitated to serve as a director
between the last day for giving notice hereunder and the date of election of
directors if the procedure called for in this paragraph was followed with
respect to the nomination of the proposed nominee.
By order of the Board of Directors
/s/ Raymond E. Jones
Raymond E. Jones
March 30, 2001 Secretary
IT IS VERY IMPORTANT THAT EVERY SHAREHOLDER VOTE. WE URGE YOU TO SIGN AND RETURN
THE ENCLOSED PROXY CARD AS PROMPTLY AS POSSIBLE, WHETHER OR NOT YOU PLAN TO
ATTEND THE MID-STATE MEETING IN PERSON. IF YOU DO ATTEND THE MID-STATE MEETING,
YOU MAY WITHDRAW YOUR PROXY AND VOTE IN PERSON AT THAT TIME. YOU MAY REVOKE YOUR
PROXY AT ANY TIME PRIOR TO ITS EXERCISE.
PLEASE INDICATE ON THE PROXY CARD WHETHER OR NOT YOU EXPECT TO ATTEND THE
MEETING SO WE CAN PROVIDE ADEQUATE ACCOMMODATIONS.
[LOGO]
MID-STATE BANCSHARES
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PROXY STATEMENT
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This Proxy Statement ("Proxy Statement") is being furnished to shareholders of
Mid-State, in connection with the solicitation of proxies by the Board of
Directors of Mid-State for use at the Annual Meeting of Shareholders of
Mid-State (including any adjournments thereof) to be held on May 16, 2001
("Meeting").
This Proxy Statement relates to the election of three directors for the Board of
Directors of Mid-State, and any such other business as may properly come before
the Meeting. This Proxy Statement is dated March 30, 2001, and is first being
mailed to shareholders of Mid-State on or about April 13, 2001.
Date, Time and Place
The Meeting will be held on Wednesday, May 16, 2001, at the Cliffs Resort, 2757
Shell Beach Road, California, at 7:30 p.m., California Time, and any adjournment
or adjournments thereof.
Record Date
The Board has fixed the close of business on March 30, 2001, as the Record Date
for the determination of shareholders entitled to notice of, and to vote at, the
Meeting. Accordingly, only holders of record of shares of Mid-State Bancshares
Common Stock, no par value ("Mid-State Stock") at the close of business on the
Record Date will be entitled to vote at the Mid-State Meeting and any
adjournment thereof. As of Record Date, there were 21,915,488 shares of stock
outstanding, held by approximately 3,550 shareholders of record.
Proxies and Revocability of Proxies
A proxy card for voting at the Meeting is enclosed with this Proxy Statement.
When a proxy card is returned, properly signed and dated, the shares represented
thereby will be voted in accordance with the instructions on the proxy card. If
a shareholder does not attend the Meeting and does not return the signed proxy
card, such holder's shares will not be voted and this will have the effect of a
vote "AGAINST" the matters to be voted on at the Meeting. Shareholders are urged
to mark the box on the proxy card to indicate how the shares represented by the
proxy card are to be voted. If a shareholder returns a signed proxy card but
does not indicate how his or her shares are to be voted, such shares will be
voted "FOR" the election of the three directors named herein. The proxy card
also confers discretionary authority on the individual appointed by the Board
named on the proxy card to
vote the shares represented thereby on any other matter that is properly
presented for action at the Meeting. A shareholder who has given a proxy may
revoke it at any time prior to its exercise at the Meeting by delivering an
instrument of revocation to the secretary of Mid-State, by duly executing and
submitting a proxy card bearing a later date, or by appearing at the Meeting and
voting in person. The mere presence at the Meeting of the person who has given a
proxy will not revoke such proxy.
Costs of Solicitations of Proxies
Mid-State will bear its own costs in connection with this solicitation. It is
contemplated that proxies will be solicited principally through the mails, but
directors, officers and regular employees of Mid-State may solicit proxies (for
no additional compensation) by personal interview, telephone, telex, telegram,
facsimile or similar means of communication. Although there is no formal
agreement to do so, Mid-State may reimburse banks, brokerage houses and other
custodians, nominees and fiduciaries for their reasonable expenses in forwarding
these proxy materials to their principals.
Outstanding Securities; Quorum
As of the Record Date, there were issued and outstanding 21,915,488 shares of
Mid-State Stock. The presence, either in person or by properly executed proxies,
of the holders of a majority of the outstanding shares of Mid-State Stock is
necessary to constitute a quorum at the Meeting. Abstentions will be counted for
purposes of establishing a quorum.
Vote Required
Shareholders are entitled to one vote at the Meeting for each share of Mid-State
Stock held of record by them on the Record Date. The candidates receiving the
highest number of affirmative votes up to the number of directors to be elected
will be elected. Cumulative voting is not permitted under Mid-State's Articles
of Incorporation.
As of the Record Date, Mid-State knew of no person who owned more than five
percent (5%) of the outstanding shares of Mid-State Stock. As of the Record
Date, directors and executive officers(a) of Mid-State beneficially owned an
aggregate of 1,773,031 shares of Mid-State Stock (including shares issuable upon
exercise of stock options within 60 days of the Record Date), or approximately
8.09% of the outstanding shares of Mid-State Stock.
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(a) For purposes of this Proxy Statement, the executive officers are deemed to
include the President and Chief Executive Officer, Executive Vice
President, Vice President and Chief Financial Officer of Mid-State
Bancshares and the President and Chief Executive Officer, Executive Vice
President and Chief Credit Officer, and Executive Vice President and Chief
Financial Officer of Mid-State Bank, a total of four (4) individuals.
2
ELECTION OF DIRECTORS
Mid-State's Bylaw and implementing resolutions provide for Mid-State to have a
total of eleven (11) directors. Mid-State has a "Classified" Board of Directors.
A "Classified" Board means that the directors are divided into three classes
with staggered terms. As a result, three persons will be elected at the Meeting
to a term of three years. At subsequent annual meetings of the Mid-State's
shareholders, a number of directors will be elected equal to the number of
directors with terms expiring at that annual meeting. The directors so elected
at these subsequent annual meetings will each be elected for a three-year term.
Set forth below is the slate of directors to be considered for re-election. In
the event that any of the nominees should be unable to serve as a director, it
is intended that proxies will be voted for the election of such substitute
nominee, if any, as shall be designated by the Board of Directors. Management
has no reason to believe that any nominee will become unavailable.
SLATE OF DIRECTORS
[PHOTO OMITTED]
Gracia Bello has been a director of Mid-State Bancshares since its formation in
1998 and a director of Mid-State Bank since 1996. A registered pharmacist, she
served as the California delegate to the American Pharmaceutical Association for
six years and was the first woman to sit on the board of the Pharmaceutical Care
Network. Ms. Bello is a member of the PAC Board for the California
Pharmaceutical Association. In 1987, she was named "Pharmacist of the Year" by
the California Pharmacists Association. Ms. Bello is a member of the Mid-State
Bancshares Compensation and Nominating Committees and an alternate to Mid-State
Bank's Board Loan Committee.
[PHOTO OMITTED]
A. J. Diani was appointed vice chairman of Mid-State Bancshares and Mid-State
Bank in 1998. He is the chairman of the board of A.J. Diani Construction Co.,
Inc., a general engineering and building construction firm operating in
California, Oregon, and Utah. He was a national director of the Associated
General Contractors of America. Mr. Diani was a founding director and appointed
chairman of the board in 1977 of the former Bank of Santa Maria, which merged
with Mid-State Bank in 1998. Mr. Diani is chairman of Mid-State Bancshares
Compensation Committee and a member of Mid-State Bank's Trust Services
Committee. He is an alternate to Mid-State Bank's Board Loan Committee.
3
[PHOTO OMITTED]
Daryl L. Flood has been a director of Mid-State Bancshares since 1998 and a
director of Mid-State Bank since 1978. A founding officer of the Bank in 1961,
he served for 30 years in a variety of positions, progressing to executive vice
president. Mr. Flood is a graduate of the Pacific Coast Banking School and has
served on the board of directors of the Independent Bankers Association of
Southern California. He was a long-time board member of the Lucia Mar Unified
School District. Mr. Flood is a member of Mid-State Bancshares Nominating
Committee and a member of Mid-State Bank's Board Loan Committee.
The following tables set forth certain information, as of March 30, 2001, with
respect to the three persons nominated by the Board of Directors for election as
directors and the eight continuing directors whose terms do not expire at the
Meeting. Mid-State knows of no arrangements, including any pledge by any person
of securities of Mid-State, the operation of which may, at a subsequent date,
result in a change in control of Mid-State. There are no arrangements or
understandings by which any of the directors of Mid-State were selected. There
are no family relationships between any of the directors or executive officers.
Common Stock Beneficially
Owned On March 30, 2001
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Year First (2)
Name, Address(1) Elected or Percentage
and Relationship with Appointed of Shares
the Company of Principal Occupation for Director Number Outstanding
Beneficial Owner Past Five Years Age Bancshares/Bank Term(3) of Shares(4) (5)
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The following three persons have been nominated for election:
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Gracia B. Bello Registered Pharmacist 71 1998/Bancshares II 20,824(6) .10%
Director 1996/Bank
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A. J. Diani Construction 79 1998/Bancshares II 183,176(6) .84%
Director 1977/Bank
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Daryl L. Flood Executive Vice President/ 66 1998/Bancshares II 200,864(6) .92%
Director Credit Administration 1978/Bank
Mid-State Bank (Retired)
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(1) The address for all persons listed is c/o Mid-State Bancshares, 1026 Grand
Avenue, Arroyo Grande, California 93420.
(2) Service with Mid-State Bancshares, Mid-State Bank, or a successor bank to
Mid-State Bank.
(3) I-Term expiring in 2003; II-Term expiring in 2004; and III-Term expiring
in 2002.
(4) Except as otherwise noted, includes shares held by each person's spouse
(except where legally separated) and minor children; shares held by any
other relative of such person who has the same home; shares held by a
family trust as to which such person is a trustee with sole voting and
investment power (or shares power with a spouse); or shares held in an
Individual Retirement Account as to which such person has pass-through
voting rights and investment power.
(5) Includes shares of common stock subject to stock option exercisable within
60 days.
(6) Includes 8,000 shares of common stock subject to stock option exercisable
within 60 days.
4
Common Stock Beneficially
Owned On March 30, 2001
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Year First(8)
Name, Address(7) Elected or Percentage of
and Relationship with Appointed Shares
the Company of Principal Occupation for Director Number Outstanding
Beneficial Owner Past Five Years Age Bancshares/Bank Term(9) of Shares(10) (11)
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The following eight directors' terms do not expire at this Meeting:
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Trudi Carey Architect, Contractor, 45 2000/Bancshares I 5,240 .02%
Director Real Estate Broker 2000/Bank
The Carey Group, Inc.
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H. Edward Heron Vice President 60 1999/Bancshares I 44,928(12) .20%
Director Coldwell Banker 1996/Bank
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Raymond E. Jones Executive Vice President/ 72 1998/Bancshares III 121,066(13) .55%
Director Chief Financial Officer 1990/Bank
Mid-State Bank (Retired)
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James W. Lokey President/Chief Executive 53 2000/Bancshares I 43,051(14) .20%
Director, Mid-State Officer, Mid-State Bank 2000/Bank
Bancshares and beginning 3/1/00
President/Chief President, Downey Savings
Executive Officer, in 1997 and 1998
Mid-State Bank Executive Vice President,
Wells Fargo Bank in 1996
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Stephen P. Maguire Investment Broker 50 1999/Bancshares I 473,332(15) 2.16%
Director President, Maguire 1999/Bank
Investments, Inc.
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Gregory R. Morris Investment Broker 60 1998/Bancshares III 108,740(16) .50%
Director Morris & Garritano 1987/Bank
Insurance
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Carrol R. Pruett Chairman of the Board, 63 1998/Bancshares III 280,509(17) 1.28%
Chairman of the Mid-State Bancshares and 1967/Bank
Board/President/Chief Mid-State Bank.
Executive Officer of President/ Chief Executive
Mid-State Bancshares Officer of Mid-State Bank
until 3/1/00
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William L. Snelling Business Manager, 69 1998/Bancshares III 176,293(18) .80%
Director Consultant 1977/Bank
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Directors and Executive 1,773,031(19) 8.09%
Officers as a group (13
persons)
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(7) The address for all persons listed is c/o Mid-State Bancshares, 1026 Grand
Avenue, Arroyo Grande, California 93420.
(8) Service with Mid-State Bancshares, Mid-State Bank, or a successor bank to
Mid-State Bank.
(9) I-Term expiring in 2003; II-Term expiring in 2004; and III-Term expiring
in 2002.
(10) Except as otherwise noted, includes shares held by each person's spouse
(except where legally separated) and minor children; shares held by any
other relative of such person who has the same home; shares held by a
family trust as to which such person is a trustee with sole voting and
investment power (or shares power with a spouse); or shares held in an
Individual Retirement Account as to which such person has pass-through
voting rights and investment power.
(11) Includes shares of common stock subject to stock option exercisable within
60 days.
(12) Includes 4,000 shares of common stock subject to stock option exercisable
within 60 days.
(13) Includes 8,000 shares of common stock subject to stock option exercisable
within 60 days.
(14) Includes 30,000 shares of common stock subject to stock option exercisable
within 60 days.
(15) Includes 4,000 shares of common stock subject to stock option exercisable
within 60 days.
(16) Includes 72,840 shares held by Mr. Morris as Trustee for Morris &
Garritano Profit Sharing Trust, as to which Mr. Morris has sole voting and
investment power; and 8,000 shares of common stock subject to stock option
exercisable within 60 days.
(17) Includes 54,790 shares of common stock subject to stock option exercisable
within 60 days.
(18) Includes 8,000 shares of common stock subject to stock option exercisable
within 60 days.
(19) Includes 115,008 shares of common stock owned by the executive officers
and shares subject to stock option exercisable within 60 days.
5
None of the Bank's directors of Mid-State is a director of any other company
with a class of securities registered pursuant to Section 12 of the Securities
Exchange Act of 1934, as amended, or subject to the requirements of Section
15(d) of such Act or any company registered as an investment company under the
Investment Company Act of 1940.
The Board of Directors and Committees
The Audit Committee is composed of Director Morris (Chairman), Carey
(Alternate), Maguire and Snelling. Each member is "independent," as defined by
the Nasdaq listing standards. The Audit Committee met five (5) times during
2000. Pursuant to its Charter, the Audit Committee shall be a standing committee
of Mid-State appointed annually by the Board of Directors. The Committee will
assist the Board in fulfilling its responsibility to the shareholders and
depositors relating to the quality and integrity of Mid-State's accounting
systems and financial-reporting processes, the identification and assessment of
business risks and the adequacy of overall control environment within Mid-State.
In so doing, they will: (1) Carry out their responsibilities in good faith and
in an informed and vigilant manner; (2) Review recommendations and reports
submitted by the regulatory agencies, the Mid-State's external financial
statement auditors, management, and Internal Audit; (3) Routinely report to the
Board of Directors, the Committee's activities and all matters of significance,
making recommendations for change as deemed advisable; (4) Establish and
maintain contact with the regulatory agencies, the external financial statement
auditors and Internal Audit to satisfy themselves that: audit coverage is
adequate, appropriate programs are maintained, and activities are executed
properly; (5) Discuss directly with management any issues of concern or interest
to the Committee; and (6) Employ such resources in the performance of their
duties, including access to separate legal council and external consultants, as
the Committee deems necessary. A copy of the Audit Committee's Charter and its
Report for the year ended December 31, 2000 are attached as Exhibits A and B,
respectively to this Proxy Statement.
Mid-State has a standing Nominating Committee of which Directors Pruett
(Chairman), Bello, Carey (Alternate), Flood and Heron are members. During the
year ended December 31, 2000, the Nominating Committee held a total of six (6)
meetings. The Committee reviews information assembled for the purpose of
selecting candidates for nomination to membership on the Board. Following
appropriate investigations, it ascertains the willingness of selected candidates
to serve and extends on behalf of the Board, invitations to become candidates.
Its recommendations are presented to the Board at regularly scheduled meetings.
The Committee will also consider, at its regularly scheduled meetings, those
recommendations by shareholders which are submitted, along with biographical and
business experience information to the Chief Executive Officer.
The Board also has a standing Compensation Committee of which Diani (Chairman),
Bello, Heron, Morris and Snelling (Alternate) are members. The primary function
of the Compensation Committee, which met eleven (11) times during 2000, is to
establish proper compensation ranges for officers and employees, delegate
certain authority to management regarding salary procedure, and determine
salaries for Mid-State officers depending upon experience, performance and
contribution to the success of Mid-State. A copy of the Compensation Committee's
Report for the year ended December 31, 2000 is attached as Exhibit C to this
Proxy Statement.
6
During the fiscal year ended December 31, 2000, the Board of Directors of
Mid-State held a total of thirteen (13) meetings. All of the persons who were
directors during 2000, attended at least 75% of the aggregate of, 1) the total
number of such meetings, and 2) the total number of meetings held by all
committees of the Board on which such director served during 2000.
Compensation Committee Interlocks and Insider Participation
Carrol R. Pruett, the Chairman of the Board, and James G. Stathos, Executive
Vice President/Chief Financial Officer of Mid-State Bank, served as a member of
the Compensation Committee until June 1, 2000. Mr. Pruett and Mr. Stathos did
not participate in the discussion of his compensation or performance when such
matters were addressed by the Committee.
Executive Compensation
The Board of Directors establishes the compensation awarded to the Executive
Officers, and determines the salaries of those executive officers based upon
their experience, performance, and contribution to the success of Mid-State. The
following table sets forth the aggregate compensation for services in all
capacities paid or accrued by Mid-State or it's banking subsidiary to the five
most highly compensated persons.
7
Summary Compensation Table
Annual Compensation Long-Term Compensation
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Name of Officer and Restricted # of Stock
Principal Position Other Annual Stock Options/ LT1P
Year Salary Bonus Compensation Awards SAR'S(20) Payouts
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Carrol R. Pruett 2000 $330,000.00(22) $0 $0 $0 $0 $ 0.00
Chairman of the Board, 1999 $317,500.00(23) $0 $0 $0 $0 $ 0.00
President 1998 $253,039.00(24) $0 $0 $0 $0 $185,000.00
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James W. Lokey 2000 $250,000.00(26) $250,000.00 $0 $0 $0 $0
President, Chief 1999 $ 0.00 $0 $0 $0 $0 $0
Executive Officer 1998 $ 0.00 $0 $0 $0 $0 $0
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Thomas E. Reese 2000 $163,298.00(27) $0 $0 $0 $0 $0
Executive Vice 1999 $148,451.00(28) $0 $0 $0 $0 $0
President 1998 $136,243.00(29) $0 $0 $0 $0 $0
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James G. Stathos 2000 $163,601.58(31) $0 $0 $0 $0 $0
Executive Vice 1999 $148,452.00(32) $0 $0 $0 $0 $0
President 1998 $133,938.00(33) $0 $0 $0 $0 $0
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Leslie Sevier 2000 $165,375.22(35) $0 $0 $0 $0 $0
Mortgage Loan 1999 $126,037.17(35) $0 $0 $0 $0 $0
Officer 1998 $128,123.34(35) $0 $0 $0 $0 $0
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Name of Officer and All Other
Principal Position Compensation
Year (21)
- -------------------------------------------------
Carrol R. Pruett 2000 $428,000.00(25)
Chairman of the Board, 1999 $334,062.00
President 1998 $206,250.00
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James W. Lokey 2000 $ 51,919.60
President, Chief 1999 $ 0.00
Executive Officer 1998 $ 0.00
- -------------------------------------------------
Thomas E. Reese 2000 $221,488.15(30)
Executive Vice 1999 $213,571.33
President 1998 $104,540.00
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James G. Stathos 2000 $221,521.81(34)
Executive Vice 1999 $205,323.22
President 1998 $158,789.00
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Leslie Sevier 2000 $ 15,490.50
Mortgage Loan 1999 $ 23,315.65
Officer 1998 $ 16,502.17
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(20) Refer to "Aggregated Options/SAR Exercises Table" on Page 10 of this Proxy
Statement.
(21) Includes Mid-State contributions to defined contribution plans (qualified
and non-qualified, and whether or not vested.)
(22) Includes $10,500.00 accrued in 2000 but deferred pursuant to the
Mid-State's 401(k) Plan (see "Profit Sharing 401(k) Plan").
(23) Includes $10,000.00 accrued in 1999 but deferred to the Mid-State's 401(k)
Plan (see "Profit Sharing 401(k) Plan").
(24) Includes $9,500.00 accrued in 1998 but deferred pursuant to the
Mid-State's 401(k) Plan (see "Profit Sharing 401(k) Plan").
(25) Includes 2000 Deferred Compensation Contribution of $410,000.00.
(26) Includes $10,500.00 accrued in 2000 but deferred pursuant to the
Mid-State's 401(k) Plan (see "Profit Sharing 401(k) Plan").
(27) Includes $10,500.00 accrued in 2000 but deferred pursuant to the
Mid-State's 401(k) Plan (see "Profit Sharing 401(k) Plan").
(28) Includes $10,000.00 accrued in 1999 but deferred pursuant to the
Mid-State's 401(k) Plan (see "Profit Sharing 401(k) Plan").
(29) Includes $8,175.00 accrued in 1998 but deferred pursuant to the
Mid-State's 401(k) Plan (see "Profit Sharing 401(k) Plan").
(30) Includes 2000 Deferred Compensation Contribution of $205,000.00.
(31) Includes $10,500.00 accrued in 2000 but deferred pursuant to the
Mid-State's 401(k) Plan (see "Profit Sharing 401(k) Plan").
(32) Includes $10,000.00 accrued in 1999 but deferred pursuant to the
Mid-State's 401(k) Plan (see "Profit Sharing 401(k) Plan").
(33) Includes $8,156.00 accrued in 1998 but deferred pursuant to the
Mid-State's 401(k) Plan (see "Profit Sharing 401(k) Plan").
(34) Includes 2000 Deferred Compensation Contribution of $205,000.00.
(35) Salary is commissioned and, as a result, fluctuates depending on market
conditions and volume.
8
Stock Options
Mid-State's 1996 Stock Option Plan (the "Stock Option Plan"), is intended to
advance the interests of Mid-State by encouraging stock ownership on the part of
key employees and non-employee directors. As of March 1, 2001, Mid-State had
options outstanding to purchase a total of 1,718,534 shares of its Common Stock
under the Stock Option Plan and 1,089,490 shares available for grant.
The following table furnishes certain information regarding stock options
outstanding and exercised under the Stock Option Plan for Mr. Pruett, Mr. Lokey,
Mr. Reese, Mr. Stathos and Ms. Sevier. Mr. Pruett was granted a stock option of
100,000 shares at an exercise price of $16.6250 per share during the first
quarter of 2001. Mr. Lokey was granted a stock option in 2000 for 150,000 shares
at an exercise price of $14.00 per share and 62,069 shares at an exercise price
of $14.50 per share during the first quarter of 2001. Mr. Reese and Mr. Stathos
were each granted a stock option of 24,138 shares at an exercise price of $14.50
per share during the first quarter of 2001. These options are a ten (10) year
option fully vested after five (5) years.
Aggregated Option/SAR Exercises in Last Fiscal Year, and Fiscal Year-End
Option/SAR Value
Number of Securities
Underlying Unexercised Value of
Shares Options/SARs at FY-End In-the-Money Options/SARs
Acquired on Value Options/SARs at FY-End FY-End
Name Exercise Realized Exercisable/Unexercisable Exercisable/Unexercisable(36)
- --------------------------------------------------------------------------------------------------------------------
Carrol R. Pruett 0 0 54,790 Exercisable $349,660.20
198,698 Unexercisable $222,921.24
- --------------------------------------------------------------------------------------------------------------------
James W. Lokey 0 0 30,000 Exercisable $112,500.00
182,069 Unexercisable $651,724.25
- --------------------------------------------------------------------------------------------------------------------
Thomas E. Reese 0 0 26,929 Exercisable $128,541.02
78,371 Unexercisable $133,093.04
- --------------------------------------------------------------------------------------------------------------------
James G. Stathos 0 0 26,929 Exercisable $128,541.02
78,371 Unexercisable $133,093.04
- --------------------------------------------------------------------------------------------------------------------
Leslie Sevier 0 0 0 Exercisable $ 0.00
0 Unexercisable $ 0.00
- --------------------------------------------------------------------------------------------------------------------
Profit Sharing/401(k) Plan
In 1963, the Board of Directors of Mid-State Bank entered into a Profit Sharing
Retirement Plan and Trust under a group program offered through the California
Bankers Association. The Plan covers substantially all of Mid-State employees,
and was amended in 1985 to be a combination qualified
- ----------
(36) Unexercisable stock options represent those options granted, but not yet
fully vested. Exercisable stock options represent the fully vested
portion. Stock options vest at the rate of 20% per year from date of
grant. Value of options determined by multiplying number of shares by the
difference between the closing price on December 31, 2000 of $17.75 per
share, and the respective exercise price per share.
9
Profit Sharing Plan (the "Profit Sharing Plan") and Savings and Retirement Plan
designed to comply with Internal Revenue Code Section 401(k) (the "401(k)
Plan"). Under the Profit Sharing Plan, the Board of Directors, in its
discretion, decides how much money, if any, will be contributed by Mid-State to
the Profit Sharing Plan depending on the amount of Mid-State's profits for the
year.
Employees are not permitted to contribute to the Profit Sharing Plan. Effective
July 10, 1998, once an employee has been in service with Mid-State one (1) full
year, his interest begins to vest at a rate of twenty percent (20%) per year for
each year of service up to five (5) years, at which point his interest is fully
vested. The maximum amount which can be contributed by Mid-State to the Profit
Sharing Plan is equal to fifteen percent (15%) of the base salary paid to
participating employees of Mid-State. No amounts are accrued or set aside for
the account of non-employee directors. Mid-State contributed approximately
$1,674,000.00 to the Profit Sharing Plan for the year ending December 31, 2000.
The amounts allocated to individual principal officers in previous years are set
forth in the Cash Compensation Table above (see "Executive Compensation" above).
Under the 401(k) Plan, each covered employee can make voluntary contributions to
his or her account in an amount up to fifteen percent (15%) of his or her base
salary; such contributions vest immediately when made. Mid-State makes a
contribution to the employee's account in an amount equal to fifty percent (50%)
of the employee's contributions, up to a maximum of six percent (6%) of the
employee's salary. Mid-State's contributions to the employee's account vest at
the rate of twenty percent (20%) per year, beginning after the third full year
of service. For the year ended December 31, 2000, Mid-State contributed
approximately $511,000.00 to the 401(k) Plan.
Deferred Compensation Plan
The Board of Directors also adopted a Deferred Compensation Plan in 1983, which
was amended in July 1996, in order to provide performance-oriented deferred
compensation for Mid-State's senior management including its executive officers.
Pursuant to the Deferred Compensation Plan, the Board of Directors sets aside a
specified amount for contribution to the Plan, representing between two percent
(2%) and four percent (4%) of Mid-State's net profits, depending upon
Mid-State's return on equity for the previous year. A committee appointed by the
Board of Directors allocates the amount contributed to the Plan among the
accounts of the participants in such proportions as the Committee shall
determine from time to time. Contributions pursuant to the Deferred Compensation
Plan become vested at the rate of ten percent (10%) per year for each full year
of service up to ten (10) years. The funds credited to the account of each
participant accrue interest at an annual rate of return equal to ninety percent
(90%) of Mid-State's prime rate, with such interest adjusted and credited to
each account quarterly. Payment of vested amounts may be made either upon
retirement or after the fifth year of participation in the Plan, in certain
specified installments, at the election of the participant. For the year ended
December 31, 2000, Mid-State made a contribution of $820,000.00 to the Deferred
Compensation Plan for the benefit of executive officers. In the first quarter of
2001, the Board of Directors approved the discontinuance of this plan, and there
will be no further annual contributions to this plan other than interest on the
balances.
10
Change in Control Agreements
Mid-State entered into "change in control" agreements with Messrs. Pruett, Reese
and Stathos as of November 12, 1997, and Mr. Lokey as of April 12, 2000. Each
agreement provides that, if a person who has acquired control of Mid-State
terminates the officer within 24 months after such change in control other than
for cause, disability or retirement (as such terms are defined in the agreement)
or if, within 24 months of such a change in control, the officer terminates the
agreement for good reason (as defined in the agreement), the officer will
receive (i) a lump sum severance payment equal to two times his annual salary
and bonus (provided that in no event shall such amount exceed 2.99 times such
officer's "annualized includible compensation for the base period" (as defined
in the Internal Revenue Code)) and (ii) continued benefits under all insured and
self-insured employee welfare benefit plans for a period ending on the earliest
of (A) three (3) years, (B) the commencement date of equivalent benefits from a
new employer or (C) the officer's normal retirement date under the terms of such
plans. In general, a "change in control" includes a change in the majority of
directors as a result of an election contest, an acquisition of 25% of the
outstanding shares, a merger, consolidation, sale of substantially all the
assets, a change in the majority of directors over a two (2) year period as well
as any other transfer, voluntarily or by hostile takeover or proxy contest,
operation of law or otherwise, of control of Mid-State.
Incentive Compensation Plan
In the first quarter of 2001, the Board of Directors approved an annual
Incentive Plan for the executive officers. The objective of the Plan is to
provide competitive compensation, warranted by performance, and aid in
motivating and retaining key executives. Messrs Lokey, Reese and Stathos are
eligible for participation in the Plan.
Other Compensation
Mid-State has provided and plans to continue to provide its executive officers
with automobiles, which are not available to all employees of Mid-State. It is
impracticable to estimate the percentage of the total costs of these benefits
attributable to personal use. No amount is stated for the foregoing, since
management has concluded that the amount of any personal benefits to any
principal officer and to the principal officers as a group is less than the
lesser of $25,000.00 per person or ten percent (10%) of the compensation
reported under "Cash Compensation" for each such person and for the group.
Compensation of Directors
From January to September, non-officer directors received $1,500.00 per month
for their service as directors and attendance at Board meetings. In October, the
fee increased to $2,000.00 per month $1,000.00 of which was a retainer, and
$1,000.00 in payment for attending meetings. If they did not attend a scheduled
meeting, the director only received a $1,000.00 retainer fee. Loan Committee
members received $200.00 per month through November with the fee increased to
$300.00 per month in December. Audit Committee members received $200.00 per
meeting through November with the fee increased to $300.00 per month in
December. Compensation Committee members received
11
$200.00 per meeting through October with the fee increased to $300.00 per
meeting attended in November. Each Committee member chairman receives a payment
of $450.00 per meeting attended. The total amount of fees paid to directors for
attendance at Board and Committee meetings during 2000 was $257,950.00. During
2000, Director Carey received a stock option grant under the 1996 Stock Option
Plan to purchase 20,000 shares of Mid-State Stock. The options were granted at
an exercise price of $13.8130 per share, fully vested in five (5) years, and are
exercisable for ten (10) years.
Performance Graph
The following table and graph display five (5) year comparative total return
performance information for Mid-State Stock, the Standard and Poors 500 Index
(S&P 500), and NASDAQ Bank Index. The information is prepared assuming $100.00
is invested in each of the three (3) potential investments, five (5) years ago.
The performance information takes into account dividends paid and the price
appreciation or depreciation of the stock(s). It should be noted that historical
performance information is no guarantee of future performance.
Mid-State Bancshares
[PERFORMANCE CHART]
Period Ending
- -----------------------------------------------------------------------------------------
Index 12/31/95 12/31/96 12/31/97 12/31/98 12/31/99 12/31/00
- -----------------------------------------------------------------------------------------
Mid-State Bancshares 100.00 136.67 266.41 278.95 322.97 368.20
S&P 500 100.00 122.86 163.86 210.64 254.97 231.74
NASDAQ Bank Index* 100.00 132.04 221.06 219.64 211.14 241.08
12
Certain Transactions
Some of the current directors and executive officers of Mid-State and the
companies with which they are associated have been customers of, and have had
banking transactions with Mid-State, in the ordinary course of Mid-State's
business, and Mid-State expects to continue to have such banking transactions in
the future. All loans and commitments to lend included in such transactions have
been made on substantially the same terms, including interest rates and
collateral, as those prevailing at the time for comparable transactions with
persons of similar creditworthiness, and in the opinion of management of
Mid-State, have not involved more than the normal risk of repayment or presented
any other unfavorable features.
Compliance with Section 16(a) of the Securities Exchange Act of 1934
Section 16(a) of the Exchange Act requires Mid-State's directors, executive
officers and ten percent (10%) or more shareholders of Mid-State's equity
securities to file with the SEC initial reports of ownership and reports of
changes of ownership of Mid-State's equity securities. Officers, directors and
ten percent (10%) or more shareholders are required by SEC regulations to
furnish Mid-State with copies of all Section 16(a) forms they file. To
Mid-State's knowledge, based solely on review of the copies of such reports
furnished to Mid-State and written representations that no other reports were
required, during the fiscal year ended December 31, 2000, all Section 16(a)
filing requirements applicable to its executive officers, directors and
beneficial owners of ten percent (10%) or more of Mid-State's equity securities
appear to have been met.
RELATIONSHIP WITH INDEPENDENT PUBLIC ACCOUNTANTS
Mid-State has not yet selected its independent public accountants for the fiscal
year ending December 31, 2001, but intends to do so later this year. Arthur
Andersen, LLP audited Mid-State's financial statements for the year ended
December 31, 2000, and have been Mid-State's accountants since 1979. It is
anticipated that a representative of Arthur Andersen, LLP will be present at the
Mid-State Meeting and will be available to respond to appropriate questions from
shareholders. All professional services rendered by Arthur Andersen LLP during
2000 were furnished at customary rates and terms.
Fees Paid to the Independent Auditors
For 2000, the Audit Committee considered and deemed the services provided by
Arthur Andersen LLP, the Mid-State's independent auditor, compatible with
maintaining the principle accountant's independence. During the fiscal year
ended December 31, 2000, fees paid to Arthur Andersen LLP consisted of the
following:
Audit Fees
Audit fees billed to Mid-State by Arthur Andersen LLP during 2000 for review of
Mid-State's annual financial statements and those financial statements included
in quarterly reports on Form 10-Q totaled $200,000.00.
13
Financial Information Systems Design and Implementation Fees
Arthur Andersen LLP did not bill Mid-State for any fees related to financial
information systems design and implementation during 2000.
All Other Fees
Fees billed to Mid-State by Arthur Andersen LLP during 2000 for all other
non-audit services including tax related services totaled $229,744.00.
PROPOSALS OF SHAREHOLDERS
Under certain circumstances, shareholders are entitled to present proposals at
shareholder meetings. Any such proposal to be included in the Proxy Statement
for Mid-State's 2002 Annual Meeting of Shareholders must be submitted by a
shareholder prior to December 21, 2001 in a form that complies with applicable
regulations.
OTHER MATTERS
Mid-State does not know of any other matters than that described in this Proxy
Statement which will be presented for consideration at the Meeting. If any other
matter properly comes before the respective meetings or any and all adjournments
or postponements thereof, the proxy holders named on the accompanying proxies
will vote the shares requested by such proxies in accordance with their best
judgement and as in accordance with said proxies.
MID-STATE BANCSHARES
/s/ Raymond E. Jones
By: Raymond E. Jones
Secretary
Arroyo Grande,California
March 30, 2001
14
EXHIBIT "A"
AUDIT COMMITTEE CHARTER
MID-STATE BANCSHARES AND MID-STATE BANK
Summary:
The Audit Committee shall be a standing committee of Mid-State Bancshares
("Mid-State") and Mid-State Bank ("the Bank") appointed annually by the Board of
Directors. The Committee will assist the Board in fulfilling its responsibility
to the shareholders and depositors relating to the quality and integrity of
Mid-State and the Bank's accounting systems and financial reporting processes,
the identification and assessment of business risks and the adequacy of overall
control environment within Mid-State and the Bank. In so doing, they will:
o Carry out their responsibilities in good faith and in an informed and
vigilant manner;
o Review recommendations and reports submitted by the regulatory agencies,
Mid-State and the Bank's external financial statement auditors,
management, and Internal Audit;
o Routinely report to the Board of Directors, the Committee's activities and
all matters of significance, making recommendations for change as deemed
advisable;
o Establish and maintain contact with the regulatory agencies, the external
financial statement auditors and Internal Audit to satisfy themselves
that: audit coverage is adequate, appropriate program are maintained, and
activities are executed properly;
o Discuss directly with management any issues of concern or interest to the
Committee; and
o Employ such resources in the performance of their duties, including access
to separate legal counsel and external consultants, as the Committee deems
necessary.
Organization and Composition Membership:
The Audit Committee shall be comprised of a minimum of three outside directors
who are "independent persons" as defined in the Rules and Regulations of the
Federal Deposit Insurance Corporation and will comply with the rules and
guidelines established by the National Association of Security Dealers (NASD) as
approved by the Security Exchange Commission (SEC).
The overall make-up of the Committee will include banking and financial
management expertise. The Committee will have at least three members, all of
whom will be literate in financial matters.
Members and the Chairman will be appointed by the Board and may be changed by
the Board at any time. The Chairman will preside over the meetings. Members will
not be:
o Current officers or employees (or an individual who has served in that
capacity during the past three years),
o Significant owners of the corporation or any of its' affiliates.
15
o An immediate family member or an individual who has been an executive
officer of the corporation or its affiliates during the past three years.
o A major customer or supplier of services (received in excess of $60,000
from Mid-State or the Bank or any of its affiliates during the previous
fiscal year, other than compensation for board service, benefits under a
tax-qualified retirement plan, or non-discretionary compensation).
o A partner in or controlling shareholder or executive officer of a "for
profit" business that is a major customer or supplier of Mid-State or the
Bank in the past three years that exceed 5% of Mid-State's or the Bank's
consolidated gross revenues for the year, or $200,000, whichever is
greater.
o Employed as an executive of another corporation where any of Mid-State's
or the Bank's executives serve on that corporation's compensation
committee.
The Committee will meet at least quarterly and may conduct additional meetings
upon call by any member of the Committee, any member of the Board of Directors
or the Auditor. A majority of the members present will constitute a quorum and
minutes will be recorded.
Responsibilities:
The following responsibilities relate to Mid-State's and the Bank's Internal
Audit function:
o Review the Audit Committee Charter and the Internal Audit Charter
annually, and recommend approval by the Board of Directors;
o Evaluate the internal audit process for establishing the annual internal
audit plan and the focus on risk;
o Review with management and approve the annual Internal Audit budget;
o Review with management and approve the annual Internal Audit plan;
o Discuss any changes required in the planned scope of the annual internal
audit plan;
o Review periodic progress reports covering the annual internal audit plan;
o Review and monitor unresolved matters related to significant internal
audit issues and the responses by management;
o Ensure appropriate independence of internal auditing and consulting
activities approved by the Committee;
o Review the appropriateness of the practices utilized to reimburse
executive officers and to assure compliance with Mid-State's and the
Bank's code of ethics; and
o Review and approve the discharge of the internal auditor and/or outsource
provide of internal audit services.
The Committee also has responsibilities related to Mid-State's and the Bank's
external financial statement auditing firm, which is ultimately accountable to
the Board and the Audit Committee.
16
These responsibilities may be covered by the full Board of Directors as part of
their regularly scheduled meetings. To the extent that additional review or
action is necessary, the Committee will address the issues and report the
results to the full Board.
The Committee will:
o Select, evaluate and recommend annual, to the Board, the appointment or
replacement of Mid-State's and the Bank's external financial statement
auditors;
o Review management's annual written report covering its responsibility for
preparing financial statements, maintaining an adequate internal control
structure, and for complying with certain laws and regulations;
o Review independence, qualifications, the annual engagement letter, the
audit scope, approve all related services and fees and ensure that the
external financial statement auditing firm submits an annual formal
written statement regarding relationships and services that may impact
independence and discuss any matters of independence; and
o Review the audited financial statement requirements, related notes, the
external financial statement auditor's opinion to be rendered in
connection therewith, and any unresolved disagreements with management
concerning accounting or disclosure matters.
Review periodically;
o The reserve for loan losses and methods used in its determination;
o Legal exposure from pending or threatened litigation;
o Management's analysis of insurance coverage;
o Selected financial information reports including the annual report; and
o Findings reported by regulatory agencies, management's response, and
monitor corrective actions on major deficiencies.
Provide sufficient opportunity for Internal Audit and external financial
statement auditors to meet with the Audit Committee without members of
management present. Issues that may be discussed include:
o External financial statement auditor's evaluation of Mid-State's and the
Bank's financial accounting,
o Internal Audit's assessment of Mid-State's and the Bank's overall control
environment,
o Independence, and
o Management support and cooperation.
Submit the minutes of all meetings of the Audit Committee to the Board of
Directors.
Perform such additional functions as are necessary and prudent to fulfill the
Committee's duties and responsibilities.
17
EXHIBIT "B"
REPORT OF THE AUDIT COMMITTEE
The Audit Committee ("Committee") of the Board of Directors is composed of four
independent directors. The members of the Committee are: Directors Morris
(Chairman), Carey (Alternate), Maguire and Snelling.
The Committee held five (5) meetings during 2000. During the course of the year,
the Committee reviewed its Charter, which was accepted by the Board of Directors
without change.
The Committee oversees the financial reporting process for Mid-State Bancshares
("Mid-State") on behalf of the Board of Directors. In fulfilling its oversight
responsibilities, the Committee reviewed the annual financial statements to be
included in the Annual Report and Form 10-K.
In accordance with Statements on Accounting Standards (SAS) No. 61, discussions
were held with management and the independent auditors regarding the
acceptability and the quality of the accounting principles used in the reports.
These discussions included the clarity of the disclosures made therein, the
underlying estimates and assumptions used in the financial reporting, and the
reasonableness of the significant judgments and management decisions made in
developing the financial statements. In addition, the Committee has discussed
with the independent auditors their independence from Mid-State and its
management, including the matters in the written disclosures required by the
Independence Standards Board Standard No. 1.
The Committee has also met and discussed with management and its independent
auditors, issues related to the overall scope and objectives of the audits
conducted, the internal controls used by Mid-State, and the selection of
Mid-State's independent auditors.
Pursuant to the reviews and discussions described above, the Committee
recommended to the Board of Directors that the audited financial statements be
included in the Annual Report on Form 10-K for the fiscal year ended December
31, 2000.
Signed and adopted by the Audit Committee this 30th day of March, 2001.
/s/ GREGORY R. MORRIS
- ------------------------------------
Committee Chairman
/s/ STEPHEN P. MAGUIRE
- ------------------------------------
Director/Committee Member
/s/ WILLIAM L. SNELLING
- ------------------------------------
Director/Committee Member
18
EXHIBIT "C"
REPORT OF THE COMPENSATION COMMITTEE
MID-STATE BANCSHARES AND MID-STATE BANK
The goals of the Mid-State Executive Compensation Program are to attract and
retain higher caliber executives, provide compensation in a cost efficient
manner, encourage executive ownership of Mid-State common stock and motivate
executives to maximize returns to shareholders, both annually and over the
long-term.
The philosophy of the Program is to provide a total reward program that supports
achievement of Mid-State's goals and objectives and provides total compensation
that is highly competitive in relation to that of provided by comparable
financial institutions.
Compensation for Mid-State's executive officers includes the following
components:
o Salary - The principal objective of the salary program is to maintain
salaries that are targeted at the 75th percentile of the market for
comparable positions in similarly sized financial institutions.
o Annual incentives - Annual incentives are designed to reward principally
for overall annual Bank performance and provide total cash compensation
that is targeted at the 75th percentile of the market when warranted by
performance, and
o Long-term incentives - The principal objective of the long-term
stock-based incentive program is to align the financial interests of
executives with those of shareholders, provide incentive for executive
ownership of Mid-State common stock, support the achievement of long-term
financial objectives, and provide for long-term incentive reward and
capital accumulation opportunities.
o Benefits - The principal objectives of the benefits program provided for
executives are to provide attractive benefits to retain key executives and
provide financial planning opportunities to facilitate tax and estate
planning.
CEO Compensation
Carrol R. Pruett performed in the capacity of President and Chief Executive
Officer of Mid-State for the year 2000. In addition, Mr. Pruett was President
and Chief Executive Officer of Mid-State Bank until March 1, 2000, when Mr.
James W. Lokey was retained as President and Chief Executive Officer. The
Committee used the same compensation policy described above for all Executive
Officers to determine Mr. Pruett's and Mr. Lokey's fiscal 2000 compensation.
19
In setting Mr. Pruett's and Mr. Lokey's compensation, the Compensation Committee
made an overall assessment of Mr. Pruett's and Mr. Lokey's leadership in
achieving Mid-State's long-term strategic and business goals. Mr. Pruett's and
Mr. Lokey's salary reflects a consideration of both competitive forces and
Mid-State's performance. Mid-State does not assign specific weights to these
categories.
/s/ A. J. DIANI
- -------------------------------------
Committee Chairman
/s/ GRACIA B. BELLO
- -------------------------------------
Director/Committee Member
/s/ H. EDWARD HERON
- ---------------------------
Director/Committee Member
/s/ GREGORY R. MORRIS
- ---------------------------
Director/Committee Member
20
Please mark
your votes as |X|
indicated in
this example
1. Election of Directors. To elect the following three (3) persons to the Board
of Directors of Mid-State to serve for a three (3) year term and until their
successors are elected and have qualified:
FOR all nominees WITHHOLD
listed below AUTHORITY
(except as marked to vote for all nominees
to the contrary) listed below
|_| |_|
Gracia B. Bello A.J. Diani Daryl L. Flood
A shareholder may withhold authority to vote for any nominee by lining through
or otherwise striking out the name of such nominee.
2. Other Business. To transact such other business as may properly come before
the Meeting and any adjournment or adjournments thereof.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE "FOR" EACH OF THE LISTED PROPOSALS.
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS AND MAY BE REVOKED
PRIOR TO USE.
The undersigned hereby acknowledges receipt of the Notice of Meeting, Proxy
Statement and Annual Report that accompanies this proxy and ratifies all lawful
actions taken by the above named proxies.
I (We) will |_| will not |_|
attend the Annual Meeting in person.
Signature(s)__________________________________________________ Date_____________
NOTE: Please sign as name appears hereon. Joint owners should each sign. When
signing as attorney, executor, administrator, trustee or guardian, please give
full title as such.
- --------------------------------------------------------------------------------
^ FOLD AND DETACH HERE ^
REVOCABLE PROXY o MID-STATE BANCSHARES
ANNUAL MEETING OF SHAREHOLDERS - MAY 16, 2001
The designated shareholder(s) of Mid-State Bancshares ("Mid-State") hereby
appoints, constitutes and nominates James W. Lokey, Raymond E. Jones and James
G. Stathos, and each of them, the attorney, agent and proxy of the undersigned,
with full power of substitution, to vote all shares of Mid-State which the
undersigned is entitled to vote at the Annual Meeting of Shareholders to be held
at the Cliffs Resort, 2757 Shell Beach Road, Shell Beach, California on May 16,
2001 at 7:30 p.m. local time, and any and all adjournments thereof, as fully and
with the same force and effect as the undersigned might or could do if
personally thereat, as indicated on the reverse side hereof.
THE PROXY CONFERS AUTHORITY AND SHALL BE VOTED IN ACCORDANCE WITH THE
RECOMMENDATION OF THE BOARD OF DIRECTORS UNLESS A CONTRARY INSTRUCTION IS
INDICATED, IN WHICH CASE THE PROXY SHALL BE VOTED IN ACCORDANCE WITH
INSTRUCTIONS. IF NO INSTRUCTION IS SPECIFIED, THE SHARES REPRESENTED BY THE
PROXY WILL BE VOTED IN FAVOR OF THE PROPOSALS LISTED ON THIS PROXY. IN ALL OTHER
MATTERS, IF ANY, PRESENTED AT THE ANNUAL MEETING, THE PROXY SHALL BE VOTED IN
ACCORDANCE WITH THE RECOMMENDATIONS OF THE BOARD OF DIRECTORS WHO WILL MAKE ANY
SUCH DETERMINATION IN THEIR SOLE DISCRETION.
- --------------------------------------------------------------------------------
^ FOLD AND DETACH HERE ^