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 Registrant [ ]
Check the appropriate box:
[ ] Preliminary Proxy Statement
[ ] Confidential, for Use of the Commission Only (as permitted by
Rule 14a-6(e)(2))
[ X ] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to 240.14a-11(c) or 240.14a-12
SIMMONS FIRST NATIONAL CORPORATION
(Name of Registrant as Specified in Its Charter)
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(Name of Person(s) Filing Proxy Statement if other than the Registrant)
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previously. Identify the previous filing by registration statement number, or
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SIMMONS FIRST NATIONAL CORPORATION
February 21, 2003
Dear Shareholder:
It is our pleasure to enclose the 2002 annual report. Normally, the annual
report is one document, but this year, as we approach our 100th year of service,
we are providing a report that depicts the history of your company while the
financials are enclosed in the attached 10-K Form.
This past year must be considered a success based on earnings and stock price.
However, loan demand has been soft due to the uncertainty of the economy.
Hopefully, 2003 will see a more progressive recovery which will result in a
continued increase in earnings.
Our annual shareholders meeting will be held on the evening of Tuesday, March
25, 2003, at the Pine Bluff Convention Center. Please note that the meeting is
approximately one month earlier than usual, so that we might celebrate on a date
close to our diamond anniversary. As is our custom, you and your spouse, or
guest, are cordially invited to join us for dinner, which will be served at 6:00
p.m. The business meeting will follow at 7:15 p.m., to be followed by special
entertainment provided by the Pine Bluff Symphony Orchestra and various local
vocalists, in celebration of our diamond anniversary. We expect to conclude all
activities by 9 p.m.
Your dinner reservation form is included with your proxy, which is also enclosed
with our proxy statement, and a return envelope for your convenience. Please
read the proxy statement and return your proxy and dinner reservations promptly.
We thank you again for your support, and we look forward to seeing you on March
25.
Sincerely,
/s/ J. Thomas May
J. Thomas May
Chairman, President and Chief Executive Officer
JTM/sm
NOTICE OF
ANNUAL MEETING OF SHAREHOLDERS
TO THE SHAREHOLDERS OF SIMMONS FIRST NATIONAL CORPORATION:
NOTICE IS HEREBY GIVEN that the annual meeting of the shareholders of
Simmons First National Corporation will be held at the Banquet Hall of the Pine
Bluff Convention Center, Pine Bluff, Arkansas, at 7:15 P.M., on Tuesday, March
25, 2003 for the following purposes:
1. To fix at 7 the number of directors to be elected at the
meeting;
2. To elect 7 persons as directors to serve until the next annual
shareholders' meeting and until their successors have been
duly elected and qualified; and
3. To transact such other business as may properly come before
the meeting or any adjournment or adjournments thereof.
Only shareholders of record at the close of business on January 15,
2003, will be entitled to vote at the meeting.
BY ORDER OF THE BOARD OF DIRECTORS:
/s/ John L. Rush
John L. Rush, Secretary
Pine Bluff, Arkansas
February 21, 2003
ANNUAL MEETING OF SHAREHOLDERS
SIMMONS FIRST NATIONAL CORPORATION
P. O. Box 7009
Pine Bluff, Arkansas 71611
PROXY STATEMENT
Meeting to be held on March 25, 2003
Proxy and Proxy Statement furnished on or about February 21, 2003
The enclosed proxy is solicited on behalf of the Board of Directors of
Simmons First National Corporation (the "Company") for use at the annual meeting
of the shareholders of the Company to be held on Tuesday, March 25, 2003, at
7:15 p.m., at the Banquet Hall of the Pine Bluff Convention Center, Pine Bluff,
Arkansas, or at any adjournment or adjournments thereof. When such proxy is
properly executed and returned, the shares represented by it will be voted at
the meeting in accordance with any directions noted thereon, or if no direction
is indicated, will be voted in favor of the proposals set forth in the notice.
REVOCABILITY OF PROXY
Any shareholder giving a proxy has the power to revoke it at any time
before it is voted.
COSTS AND METHOD OF SOLICITATION
The costs of soliciting proxies will be borne by the Company. In
addition to the use of the mails, solicitation may be made by employees of the
Company by telephone, telegraph and personal interview. These persons will
receive no compensation other than their regular salaries, but they will be
reimbursed by the Company for their actual expenses incurred in such
solicitations.
OUTSTANDING SECURITIES AND VOTING RIGHTS
At the meeting, holders of the $1.00 par value Class A common stock
(the "Common Stock") of the Company, the only class of stock of the Company
outstanding, will be entitled to one vote, in person or by proxy, for each share
of the Common Stock owned of record, as of the close of business on January 15,
2003. On that date, the Company had outstanding 7,074,236 shares of the Common
Stock; 1,073,155 of such shares were held by Simmons First Trust Company
("SFTC"), in a fiduciary capacity, of which 203,962 shares will not be voted at
the meeting. Hence, 6,870,274 shares will be deemed outstanding and entitled to
vote at the meeting.
All actions requiring a vote of the shareholders must be taken at a
meeting in which a quorum is present in person or by proxy. A quorum consists of
a majority of the outstanding shares entitled to vote upon a matter. With
respect to each proposal subject to a stockholder vote, other than the election
of directors, approval requires that the votes cast for the proposal exceed the
votes cast against it. The election of directors will be approved, if each
director nominee receives a plurality of the votes cast. All proxies submitted
will be tabulated by SFTC.
With respect to the election of directors, a shareholder may withhold
authority to vote for all nominees by checking the box "withhold authority for
all nominees" on the enclosed proxy or may withhold authority to vote for any
nominee or nominees by checking the box "withhold authority for certain
nominees" and lining through the name of such nominee or nominees for whom the
authority to vote is withheld as it appears on the enclosed proxy. The enclosed
proxy also provides a method for shareholders to abstain from voting on each
other matter presented. By abstaining, shares will not be voted either for or
against the subject proposals, but will be counted for quorum purposes. While
there may be instances in which a shareholder may wish to abstain from voting on
any particular matter, the Board of Directors encourages all shareholders to
vote their shares in their best judgment and to participate in the voting
process to the fullest extent possible.
An abstention or a broker non-vote, (i.e., when a shareholder does not
grant his or her broker authority to vote his or her shares on non-routine
matters) will have no effect on any item to be voted upon by the shareholders.
In the event a shareholder executes the proxy but does not mark the
ballot to vote (or abstain) on any one or more of the proposals, the proxy
solicited hereby confers discretionary authority to the named proxies to vote in
their sole discretion with respect to such proposals. Further, if any matter,
other than the matters shown on the proxy, is properly presented at the meeting
which may be acted upon without special notice under Arkansas law, the proxy
solicited hereby confers discretionary authority to the named proxies to vote in
their sole discretion with respect to such matters, as well as other matters
incident to the conduct of the meeting. On the date of the mailing of this Proxy
Statement, the Board of Directors has no knowledge of any such other matter
which will come before the meeting.
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS
The following table sets forth all persons known to management who own,
beneficially or of record, more than 5% of the outstanding Common Stock, the
number of shares owned by the named Executive Officers in the Summary
Compensation Table and by all Directors and Executive Officers as a group.
Name and Address of Beneficial Owner Shares Owned Beneficially [a] Percent of Class
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Simmons First National Corporation
Employee Stock Ownership Trust [b] 582,249 8.23%
501 Main Street
Pine Bluff, AR 71601
Barry L. Crow [c] 34,273 *
Robert A. Fehlman [d] 6,103 *
J. Thomas May [e] 145,118 2.05%
James P. Powell [f] 18,107 *
Tommie Jones [g] 9,440 *
All directors and officers as a group (12 persons) 321,302 4.54%
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* The shares beneficially owned represent less than 1% of the
outstanding common shares.
[a] Under the applicable rules, "beneficial ownership" of a security
means, directly or indirectly, through any contract, relationship, arrangement,
undertaking or otherwise, having or sharing voting power, which includes the
power to vote or to direct the voting of such security, or investment power,
which includes the power to dispose of or to direct the disposition of such
security. Unless otherwise indicated, each beneficial owner named has sole
voting and investment power with respect to the shares identified.
[b] The Simmons First National Corporation Employee Stock Ownership
Plan ("ESOP") purchases, holds and disposes of shares of the Company's stock.
The Executive Compensation and Retirement Committee directs the trustees of the
ESOP trust concerning when, how many and upon what terms to purchase or dispose
of such shares, other than by distribution under the Plan. Shares held by the
Trust may be voted only in accordance with the written instructions of the plan
participants, who are all employees or former employees of the Company and its
subsidiaries.
[c] Mr. Crow owned of record 8,064 shares; 11,703 shares were held in
his fully vested account in the ESOP; 2,184 shares were held in his IRA account;
1,238 were held jointly with his wife; 1,273 shares were held in a trust created
by his wife; 300 shares were held in his wife's IRA and 9,500 shares were deemed
held through exercisable incentive stock options.
[d] Mr. Fehlman owned of record 736 shares; 1,387 shares were held in
his fully vested account in the ESOP and 3,980 shares were deemed held through
exercisable incentive stock options.
[e] Mr. May owned of record 53,833 shares; 9,253 shares were held in
his IRA account; 386 shares were owned by his wife; 180 shares were owned by his
stepchildren; 6,966 shares were held in his fully vested account in the ESOP;
and 74,500 shares were deemed held through exercisable stock options.
[f] Mr. Powell owned of record 5,208 shares; 79 shares were held
jointly with his wife; 424 shares were held by his wife; 7,896 shares were held
in his fully vested account in the ESOP and 4,500 shares were deemed held
through exercisable incentive stock options.
[g] Ms. Jones owned of record 815 shares; 3,925 shares were held in her
fully vested account in the ESOP and 4,700 shares were deemed held through
exercisable incentive stock options.
ELECTION OF DIRECTORS
The Board of Directors of the Company recommends that the number of
directors to be elected at the meeting be fixed at seven (7) and that the
persons named below be elected as such directors, to serve until the next annual
meeting of the shareholders and until their successors are duly elected and
qualified. Each of the persons named below is presently serving as a director of
the Company for a term which ends on March 25, 2003, or such other date upon
which a successor is duly elected and qualified.
The proxies hereby solicited will be voted for the election of the
nominees shown below, unless otherwise designated in the proxy. If at the time
of the meeting any of the nominees should be unable or unwilling to serve, the
discretionary authority granted in the proxy will be exercised to vote for the
election of a substitute or substitutes. Management has no reason to believe
that any substitute nominee or nominees will be required.
The table below sets forth the name, age, principal occupation or
employment during the last five years, prior service as a director of the
Company, the number of shares and percentage of the outstanding Common Stock
beneficially owned, with respect to each director and nominee proposed, as
reported by each nominee:
Principal Director Shares Percent
Name Age Occupation [a] Since Owned [b] of Class
---- --- -------------- ----- --------- --------
Lara F. Hutt, III 67 President, Hutt Building 1995 [c] 37,254 [d] *
Material Company, Inc.
George Makris, Jr. 46 President, M. K. 1997 9,950 [e] *
Distributors, Inc.
(Beverage Distributor)
J. Thomas May 56 Chairman, President and Chief 1987 145,118 [f] 2.05%
Executive Officer of the
Company; Chairman and Chief
Executive Officer of Simmons
First National Bank
David R. Perdue 68 Vice President, JDR, Inc. 1976 19,500 [g] *
(Investments)
Harry L. Ryburn 67 Orthodontist 1976 1,314 [h] *
Henry F. Trotter, Jr. 65 President, Trotter 1995 [i] 22,852 [j] *
Ford, Inc. and President,
Trotter Auto, Inc.
William E. Clark 59 Chairman and Chief Executive 2001 800 [k] *
Officer, CDI Contractors, LLC
(Construction); President, Bragg's
Electric Construction Company
------------------
* The shares beneficially owned represent less than 1% of the
outstanding common shares.
[a] All persons have been engaged in the occupation listed for at least
five years.
[b] "Beneficial ownership" of a security means, directly or indirectly,
through any contract, relationship, arrangement, undertaking or otherwise,
having or sharing voting power, which includes the power to vote or to direct
the voting of such security, or investment power, which includes the power to
dispose or to direct the disposition of such security. Unless otherwise
indicated, each beneficial owner named has sole voting and investment power with
respect to the shares identified.
[c] Prior to his election in 1995, Mr. Hutt had served as a director of
the Company from 1976 through 1992.
[d] Mr. Hutt owned of record 30,354 shares; and 6,900 shares were owned
by his wife.
[e] Mr. Makris owned of record 3,600 shares; 1,000 shares were held in
his IRA; 3,200 shares were held as custodian for his minor children; 1,150
shares were held in his wife's Individual Retirement Account; 1,000 shares are
held in the M-K Distributors' Profit Sharing Trust of which Mr. Makris is a
trustee with shared dispositive and voting power.
[f] Mr. May owned of record 53,833 shares; 9,253 shares were held in
his IRA account; 386 shares were owned by his wife; 180 shares were owned by his
stepchildren; 6,966 shares were held in his fully vested account in the ESOP;
and 74,500 shares were deemed held through exercisable stock options.
[g] Mr. Perdue owned of record 17,685 shares and 1,815 shares were
owned by his wife.
[h] Dr. Ryburn and his wife are general partners in a family limited
partnership which owns 61, 812 shares pursuant to which 1,236 shares held by the
partnership are attributable to Dr. Ryburn and 78 shares are held by Greenback
Investment Club which are attributable to Dr. Ryburn.
[i] Prior to his election in 1995, Mr. Trotter had served as a director
of the Company from 1973 through 1992.
[j] Mr. Trotter owned of record 14,332 shares and 820 shares were owned
by Bluff City Leasing, Inc., of which Mr. Trotter is President.
[k] Mr. Clark is the general partner in a family limited partnership
which owns 800 shares which are attributable to him.
Committees and Related Matters
Among the various committees of the Board of Directors of the Company
are the Audit and Security Committee and Executive Compensation and Retirement
Committee. During 2002, the Board of Directors of the Company had no standing
nominating committee or other committee performing a similar function, but has
recently established a Nominating and Corporate Governance Committee.
During 2002, the Audit and Security Committee was composed of David
Perdue, Lara F. Hutt, III, Louis L. Ramsay, Jr. (non-voting Advisory Director),
Beverly Morrow (Director of Simmons First National Bank), Bill Clark and George
Makris, Jr. This committee provides assistance to the Board in fulfilling its
responsibilities concerning accounting and reporting practices, by regularly
reviewing the adequacy of the internal and external auditors, the disclosure of
the financial affairs of the Company and its subsidiaries, the control systems
of management and internal accounting controls. During 2002, this Committee met
12 times. For 2003, the Audit and Security Committee consists of David Perdue,
Lara Hutt, III, George Makris and Bill Clark.
The Executive Compensation and Retirement Committee, which was composed of
W. E. Ayres (non-voting Advisory Director), A. W. Nelson (Director of Simmons
First National Bank), David Perdue, Louis L. Ramsay, Jr. (non-voting Advisory
Director), Harry L. Ryburn, and Jerry Watkins (non-voting Advisory Director)
during 2002, fixes the compensation of executive officers of the Company, adopts
the salary programs for other personnel and administers the retirement and
employee benefit plans of the Company. During 2002, the Executive Compensation
and Retirement Committee met 7 times.
Effective in January 2003, the Board established a Nominating and Corporate
Governance Committee composed of W. E. Ayres (non-voting Advisory Director),
Bill Clark, George Makris, Jr. Mary Pringos (Director of Simmons First National
Bank), Louis L. Ramsay, Jr. (non-voting Advisory Director), Harry L. Ryburn, and
Jerry Watkins (non-voting Advisory Director).
The Board of Directors of the Company met 12 times during 2002, including
regular and special meetings. No director attended fewer than 75% of the
aggregate of all meetings of the Board of Directors and of all committees on
which such director served, except for Bill Clark who attended 70% of such
meetings.
Certain Transactions
From time to time Simmons First National Bank, Simmons First Bank of
Russellville, Simmons First Bank of South Arkansas, Simmons First Bank of
Jonesboro, Simmons First Bank of Searcy, Simmons First Bank of Northwest
Arkansas and Simmons First Bank of El Dorado, N.A., banking subsidiaries of the
Company, have made loans and other extensions of credit to directors, officers,
employees and members of their immediate families, and from time to time
directors, officers and employees and members of their immediate families have
placed deposits with these banks. These loans, extensions of credit and deposits
were made in the ordinary course of business on substantially the same terms
(including interest rates and collateral) as those prevailing at the time for
comparable transactions with other persons and did not involve more than the
normal risk of collectibility or present other unfavorable features.
Director Compensation
The outside Directors of the Company are paid a $300 monthly retainer
plus $400 for each meeting of the Board and its committees attended. The
Directors of the Company who also serve as officers of the Company are paid a
$300 monthly retainer plus $100 for each meeting of the Board attended.
EXECUTIVE COMPENSATION
The tables below set forth the compensation for 2000, 2001 and 2002 of
the Chief Executive Officer and the four highest paid executive officers of the
Company during 2002.
Summary Compensation Table
--------------------------
Long Term
Annual Compensation Compensation
------------------- ------------
Other
Annual Restricted Securities
Name and Compen- Stock Underlying
Principal sation[b] Awards Options/ All Other
Position Year Salary($) Bonus($)[a] ($) ($) SARs (#) Compensation ($)[c]
-------- ---- --------- -------- -------- ---------- -------- -------------------
($)
J. Thomas May, 2002 $327,654 $73,933 $ 9,700 $ 0 0 $ 79,336
Chief Executive 2001 $308,000 $32,500 $ 9,600 $466,500 55,000 $ 107,899
Officer 2000 $308,000 $32,500 $ 10,600 $ 79,500 0 $ 66,314
Barry L. Crow, 2002 $142,314 $38,023 $ 0 $ 0 0 $ 11,953
Executive Vice 2001 $137,501 $17,500 $ 0 $ 24,490 9,000 $ 11,449
President 2000 $132,851 $16,500 $ 0 $ 0 1,000 $ 12,267
James P. Powell, 2002 $101,466 $26,933 $ 0 $ 0 0 $ 8,547
Senior Vice 2001 $ 98,051 $12,250 $ 0 $ 12,245 4,500 $ 8,287
President & Auditor 2000 $ 94,720 $11,500 $ 0 $ 0 500 $ 8,820
Robert A. Fehlman, 2002 $100,297 $26,405 $ 0 $ 0 0 $ 7,812
Senior Vice President 2001 $ 92,022 $10,000 $ 0 $ 17,143 6,300 $ 6,759
& Controller 2000 $ 85,582 $ 8,000 $ 0 $ 0 1,000 $ 6,971
Tommie Jones, 2002 $ 92,505 $22,180 $ 0 $ 0 0 $ 7,641
Senior Vice President 2001 $ 83,544 $10,000 $ 0 $ 12,245 4,500 $ 6,941
& H. R. Director 2000 $ 76,298 $16,500 $ 0 $ 0 500 $ 7,116
----------------------
[a] These amounts are earned and paid pursuant to the Simmons First
National Corporation Incentive Compensation Program, which is described in the
Compensation Committee Report on Executive Compensation.
[b] Fees paid to Directors for attendance at Board meetings of the
Company and its subsidiaries.
[c] For 2002, this category includes for Mr. May contribution to the
ESOP, $9,325, the Company's matching contribution to the ss.401(k) Plan, $2,500,
the accrual to his deferred compensation agreement, $52,360, benefit to Mr. May
of premiums under the split dollar life insurance program, $14,311, and other
life insurance premiums, $840; for Mr. Crow contribution to the ESOP, $9,325,
the Company's matching contribution to the ss.401(k) Plan, $2,153, and life
insurance premiums, $475; for Mr. Powell contribution to the ESOP, $6,668, the
Company's matching contribution to the ss.401(k) Plan, $1,540, and life
insurance premiums, $339; for Mr. Fehlman contribution to the ESOP, $6,396, and
the Company's matching contribution to the ss.401(k) Plan, $1,416; and for Ms.
Jones contribution to the ESOP, $5,960, the Company's matching contribution to
the ss.401(k) Plan, $1,376, and life insurance premiums, $305. Certain
additional personal benefits, including club memberships, are granted to
officers of the Company, including the named executive officers; however, in the
Company's estimation the value of such personal benefits to the named executive
officers does not exceed the lesser of $50,000 or 10% of the aggregate
compensation of any such officer.
Deferred Compensation and Change in Control Arrangements
One of the individuals named above, J. Thomas May, is a party to a
deferred compensation agreement, under the terms of which Simmons First National
Bank, agrees to pay to Mr. May, upon normal retirement at age 65, or upon death
or disability prior to age 65, a monthly sum of deferred compensation equal to
one twelfth (1/12) of fifty percent (50%) of the final average compensation (the
average compensation paid to him by the employer for the most recent five
consecutive calendar years), less the accrued monthly benefit to such individual
under the deferred annuity received upon the termination of the Company's
pension plan; such payments begin the month following retirement and continue
for 120 consecutive months or until the individual's death, whichever shall
occur later.
Further, the deferred compensation agreement provides that, in the
event of a change of control of the Company and the subsequent separation from
service of Mr. May, eligibility to receive payments under the Agreement will be
accelerated. In such circumstance, if Mr. May has attained age 60, the officer
is entitled to commence receiving the specified monthly payments under the
agreement immediately after separation from service, without any actuarial
reduction due to age. If at such time he has not attained age 60, Mr. May will
be entitled to immediately commence receiving 72 monthly payments equal to one
twelfth (1/12) of fifty (50%) percent of the final average compensation, less
the accrued monthly benefit to such individual then payable under the annuity
received pursuant to the termination of the Company's pension plan.
Aggregated Option/SAR Exercises in the Last Fiscal Year and Fiscal Year End
Option Values
The following table sets forth information with respect to the named
executive officers concerning unexercised options held as of December 31, 2002.
Aggregated Option/SAR Exercises in Last Fiscal Year and Fiscal Year End Option/SAR Values
-----------------------------------------------------------------------------------------
Shares Number of Securities Underlying Value of Unexercised
Acquired Value Unexercised Options at FY-End In-the-Money Options
on Exercise Realized Options at FY-End (#) at FY-End ($) [a]
Name (#) ($) Exercisable/ Unexercisable Exercisable/ Unexercisable
----------------------------------------------------------------------------------------------------------
J. Thomas May 4,500 $76,697 74,500 / 33,000 $ 842,575 / $ 409,200
Barry L. Crow 1,800 $27,612 9,500 / 6,000 $ 105,189 / $ 75,610
James P. Powell 0 $ 0 4,500 / 3,000 $ 43,317 / $ 37,805
Robert A. Fehlman 0 $ 0 3,980 / 4,320 $ 48,793 / $ 54,789
Tommie Jones 300 $ 3,190 4,700 / 3,000 $ 43,137 / $ 37,805
[a] The Value Realized is computed using the difference between the
market price upon the date of exercise and the option price. The Value of
Unexercised In-the-Money Options at FY-End is computed using $36.65, the closing
price on December 31, 2002.
Compensation Committee Interlocks and Insider Participation
During 2002, the Executive Compensation and Retirement Committee was
composed of W. E. Ayres (non-voting Advisory Director), A. W. Nelson (Director
of Simmons First National Bank), David Perdue, Louis L. Ramsay, Jr. (non-voting
Advisory Director), Harry L. Ryburn, and Jerry Watkins (non-voting Advisory
Director). None of these individuals were employed as officers or employees of
the Company during 2002. Prior to retirement in 1983 and 1995, respectively,
Louis L. Ramsay, Jr. and W. E. Ayres were previously employed by the Company in
various capacities, including Chief Executive Officer.
Compensation Committee Report on Executive Compensation
The Executive Compensation and Retirement Committee issued the following
report on the general guidelines for executive compensation and the bases for
establishing the compensation of the Chief Executive Officer:
General Compensation Guidelines for Executive Officers
------------------------------------------------------
The Company currently utilizes a unitary compensation structure for its
executive officers and the executive officers of its subsidiaries. The
compensation program consists of four elements: Salary, Incentive Compensation,
Stock Related Compensation, and Retirement Compensation.
The Company, after consultation with a nationally recognized
compensation advisory firm, has established job grades and determined the value
of each job within the Company. Subject to adjustment for unique factors
affecting the job or the executive, the Company targets the midpoint of the
market salary range for each job grade, as adjusted annually, as the guide for
salaries for executive officers, who are satisfactorily performing their duties.
The Simmons First National Corporation Incentive Compensation Program
provides compensatory incentives for executive officers to reinforce achievement
of the financial goals of the Company, its subsidiary banks and the
participating executives. At the beginning of each year, participating
executives are allocated incentive points, which are the basis of the
executive's participation within the program. Annually, performance thresholds
are established for the Company (net income threshold), each of the subsidiary
banks (net income threshold) and each of the participating executive officers
(thresholds based upon actual department income and expense factors versus
budgeted items). Incentive compensation is payable under the incentive program
for a fiscal year if (1) the Company satisfied an applicable threshold, (2) the
entity employing the executive satisfied an applicable threshold and (3) the
executive satisfied at least 75% of the applicable individual threshold.
Performance by the Company and the subsidiary banks above the thresholds may
proportionately increase the compensation of each incentive point.
Stock related compensation may consist of incentive stock options,
non-qualified options (with or without stock appreciation rights) or restricted
shares of the Company's stock. Over the years the Company has maintained several
different stock option and stock incentive plans. The Company currently
maintains an executive stock incentive plan which authorizes the granting of
incentive stock options, non-qualified options (with or without stock
appreciation rights) or restricted shares of the Company's stock to certain
executive officers. The plans are designed to provide an incentive for the
participating executive officers to enhance the long term financial performance
of the Company and the value of the Common Stock. Participation under these
plans has been offered to those executive officers whose long term employment
and job performance can significantly affect the continued profitability of the
Company and its subsidiary banks.
The Company also maintains a Profit-Sharing/Employee Stock Ownership
Plan and a ss.401(k) Plan to provide retirement benefits for substantially all
of its employees, including its executive officers.
Bases for the Chief Executive Officer's Compensation
----------------------------------------------------
The compensation of the chief executive officer is set by the Executive
Compensation and Retirement Committee and approved by the Board of Directors.
The committee and the Board examine the annual market analysis provided by the
compensation consultant retained by the Company prior to setting his
compensation. The committee emphasizes incentive compensation for the chief
executive officer, through the incentive compensation program and stock related
compensation. In analyzing the compensation of the chief executive officer, the
committee evaluates his performance in managing the operations as well as the
financial results of operations of the Company. Among the criteria examined are
management and leadership, revenue growth, expense control, net earnings, market
share, acquisition and expansion activities and other factors material to the
job performance of the chief executive officer.
The chief executive officer was allocated 700 points in the incentive
compensation program. His threshold of performance was based upon the net income
of the Company (60%) and Simmons First National Bank (40%). The Company's income
for 2002 exceeded the Company's budgeted performance threshold for 2002. Based
upon these events, the incentive compensation earned by the chief executive
officer under this Program was $105.62 per point, or $73,933.
In addition, Simmons First National Bank maintains a deferred
compensation agreement for the chief executive officer, as a supplement to the
retirement benefits available under the other plans. This agreement provides for
a monthly benefit at age 65, or earlier upon death or disability, equal to 50%
of the average monthly compensation of the executive officer during the prior
five years and provides certain benefits, in the event of a change in control of
the Company and the subsequent separation from service by the chief executive
officer.
Executive Compensation & Retirement Committee
Harry L. Ryburn, Chairman W. E. Ayres David R. Perdue
Louis L. Ramsay, Jr. A. W. Nelson Jerry Watkins
Performance Graph
The graph below shows a comparison of the cumulative total shareholder
return (assuming reinvestment of dividends), as of December 31 of each year, for
the Common Stock, the S&P 500 Index and the NASDAQ Bank Stock Index, assuming a
$100 investment on December 31, 1997.
Note: The results shown on the graph above is not indicative of future
price performance.
1997 1998 1999 2000 2001 2002
SFNC $100 $ 88 $ 60 $ 57 $ 83 $ 97
NASDAQ Bank Index $100 $ 99 $ 96 $109 $118 $121
S&P 500 Index $100 $129 $156 $141 $125 $ 97
SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
Section 16(a) of the Securities and Exchange Act of 1934 and the
regulations issued thereunder require directors and certain officers of any
company registered under that Act to file statements on SEC Forms 3, 4 & 5 with
the Securities and Exchange Commission, showing their beneficial ownership in
securities issued by such company. Based upon a review of such statements by the
directors and officers of the Company for the preceding fiscal year, provided to
the Company by such persons, the Company has not identified any person who
failed to timely file the required statements during the preceding fiscal year.
AUDIT AND SECURITY COMMITTEE
During 2002, the Audit and Security Committee was composed of David
Perdue, Lara F. Hutt, III, Louis L. Ramsay, Jr. (non-voting Advisory Director),
Beverly Morrow (Director of Simmons First National Bank), Bill Clark and George
Makris, Jr. For 2003, the Audit and Security Committee consists of David Perdue,
Lara F. Hutt, III, George Makris, Jr. and Bill Clark. Each of the listed
committee members are independent as defined in Rule 4200 of the National
Association of Securities Dealers listing requirements. This committee provides
assistance to the Board in fulfilling its responsibilities concerning accounting
and reporting practices, by regularly reviewing the adequacy of the internal and
external auditors, the disclosure of the financial affairs of the Company and
its subsidiaries, the control systems of management and internal accounting
controls. During 2002, this Committee met 12 times.
The Audit and Security Committee issued the following report concerning
its activities related to the Company for the previous year:
The Audit and Security Committee has reviewed and discussed the audited
financial statements of the Company for the year ended December 31, 2002 with
management.
The Audit and Security Committee has discussed with BKD, LLP ("BKD"),
its independent auditors, the matters required to be discussed by SAS 61
(Codification of Statements on Auditing Standards, AU 380).
The Audit and Security Committee has received the written disclosures
and the letter from independent accountants required by Independence Standards
Board Standard No. 1 (Independence Standards Board Standard No. 1, Independence
Discussions with Audit Committees) and has discussed with BKD its independence.
Based upon the foregoing review and discussions, the Audit and Security
Committee recommended to the Board of Directors that the audited financial
statements be included in the Company's Annual Report on Form 10-K for the last
fiscal year for filing with the Securities and Exchange Commission.
In its analysis of the independence of BKD, the Audit and Security
Committee considered whether the non-audit related professional services
rendered by BKD to the Company, were compatible with maintaining the principal
accountant's independence.
Audit and Security Committee
Louis L. Ramsay, Jr. Lara F. Hutt, III George Makris, Jr.
David Perdue Beverly Morrow Bill Clark
INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS
BKD, LLP ("BKD") served as the Company's auditors in 2002 and has been
selected to serve in 2003. Representatives of BKD are expected to be present at
the shareholders meeting with the opportunity to make a statement if they so
desire and are expected to be available to respond to appropriate questions.
Audit Fees
----------
The aggregate fees billed to the Company for professional services
rendered by BKD for the audit of the Company's annual financial statements for
the year ended December 31, 2002 and the reviews of the financial statements
included in the Company's Form 10-Q's for 2002 was $172,585.
Financial Information Systems Design and Implementation Fees.
-------------------------------------------------------------
The Company did not retain BKD to provide any services related to
financial information systems design and implementation and accordingly no fees
were paid for this type of service.
All Other Fees
--------------
The aggregate fees billed to the Company for other professional
services (excluding audit fees and financial information systems design and
implementation fees) rendered by BKD to the Company for the year ended December
31, 2002 was $83,216. These services consisted of income tax services for the
Company $25,325 and audits and income tax return preparation for employee
benefit plans and common trust funds sponsored or managed by the Company and its
subsidiaries $57,891.
FINANCIAL STATEMENTS
A copy of the annual report of the Company for 2002 on Form 10-K
required to be filed with the Securities and Exchange Commission, including
audited financial statements, is enclosed herewith. Such report and financial
statements contained therein are not incorporated into this Proxy Statement and
are not considered a part of the proxy soliciting materials, since they are not
deemed material for the exercise of prudent judgment in regard to the matters to
be acted upon at the meeting.
PROPOSALS FOR 2004 ANNUAL MEETING
Shareholders who intend to have a proposal considered for inclusion in
the Company's proxy materials for presentation at the 2004 Annual Meeting of
Shareholders must submit the proposal to the Company no later than October 24,
2003. Shareholders who intend to present a proposal at the 2004 Annual Meeting
of Shareholders without inclusion of such proposal in the Company's proxy
materials are required to provide notice of such proposal to the Company no
later than January 7, 2004. The Company reserves the right to reject, rule out
of order, or take other appropriate action with respect to any proposal that
does not comply with these and other applicable requirements.
OTHER MATTERS
Management knows of no other matters to be brought before this annual
meeting. However, if other matters should properly come before the meeting, it
is the intention of the persons named in the proxy to vote such proxy in
accordance with their best judgment on such matters.
BY ORDER OF THE BOARD OF DIRECTORS:
/s/ John L. Rush
John L. Rush, Secretary
Pine Bluff, Arkansas
February 21, 2003
PROXY BALLOT
SIMMONS FIRST NATIONAL CORPORATION
March 25, 2003
PROXY SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS FOR
THE ANNUAL MEETING OF STOCKHOLDERS, MARCH 25, 2003
The undersigned hereby constitutes and appoints William C. Bridgforth, William
L. Ferren, and Marguerite L. "Sissy" Jones as Proxies, each with the power of
substitution, to represent and vote as designated on this proxy card all of the
shares of common stock of Simmons First National Corporation held of record by
the undersigned on January 15, 2003, at the Annual Meeting of Shareholders to be
held on March 25, 2003, and any adjournment thereof.
This proxy, when properly executed, will be voted as directed. IF NO DIRECTION
IS GIVEN, THIS PROXY WILL BE VOTED FOR ALL PROPOSALS.
(1) PROPOSAL TO FIX THE NUMBER OF DIRECTORS AT SEVEN.
____ FOR ____ AGAINST ____ ABSTAIN
(2) ELECTION OF DIRECTORS (mark only one box)
____ FOR ALL NOMINEES
____ WITHHOLD AUTHORITY FOR ALL NOMINEES
____ WITHHOLD AUTHORITY FOR CERTAIN NOMINEES below whose names
have been lined through:
William E. Clark George A. Makris, Jr. David R. Perdue Henry F. Trotter, Jr.
Lara F. Hutt, III J. Thomas May Dr. Harry L. Ryburn
(3) Upon such other business as may properly come before the meeting or
any adjournment or adjournments thereof.
The undersigned acknowledges receipt of this ballot, Notice of Annual
Meeting, Proxy Statement, and Form10-K.
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Date
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Signature(s) of Shareholder(s) Date
IMPORTANT: Please date this proxy and sign your name exactly as your name
appears and return promptly in the envelope provided.
Please make reservations for
Simmons First National Corporation
S H A R E H O L D E R ` S D I N N E R
6:00 in the Evening
March 25, 2003
The Pine Bluff Convention
Center Banquet Hall
(100 year Medallion)
D I N N E R R E S E R V A T I O N C A R D
_______ I will attend
_______ A guest and I will attend
_______ I will NOT attend