SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Form 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of
the Securities Exchange Act of 1934
March 16, 2012 (March 14, 2012)
Date of Report
(Date of Earliest Event Reported)
Synovus Financial Corp.
(Exact Name of Registrant as Specified in its Charter)
| Georgia | 1-10312 | 58-1134883 | ||
| (State of Incorporation) | (Commission File Number) | (IRS Employer Identification No.) |
1111 Bay Avenue, Suite 500, Columbus, Georgia 31901
(Address of principal executive offices) (Zip Code)
(706) 649-2311
(Registrant’s telephone number, including area code)
(Former name or former address, if changed since last report)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
| ¨ | Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
| ¨ | Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
| ¨ | Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
| ¨ | Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
| Item 5.02 | Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers. |
On March 14, 2012, the Compensation Committee of the Board of Directors (the “Compensation Committee”) of Synovus Financial Corp. (“Synovus”) took several actions impacting the compensation arrangements of Synovus’ named executive officers. All of the actions comply with the executive compensation restrictions implemented under the Troubled Asset Relief Program (“TARP”).
Base Salaries. The Compensation Committee approved a 2.5% increase (rounded to the nearest $1,000) in base salaries for Synovus’ executive officers, including its named executive officers, effective March 18, 2012.
Salary Stock. Consistent with the actions taken by many of Synovus’ peer companies subject to TARP, the Compensation Committee granted salary stock for 2012 to Synovus’ executive officers, including its named executive officers. The salary stock will take the form of restricted stock units granted under Synovus’ 2007 Omnibus Plan and will be granted as of each bi-weekly payroll date. At each salary payment date, the employee will receive a number of salary stock units equal to the proportionate amount of the annual rate for the pay period divided by the stock closing price on the payment date. The salary stock units will be fully vested when awarded and will be settled in cash on February 15, 2013. Synovus will not pay cash bonuses to its named executive officers in 2012 due to restrictions under TARP. The form of Salary Stock Award Agreement, which governs the payment of salary stock units granted in 2012, is attached hereto as Exhibit 10.1.
Long-Term Equity Incentives. The Compensation Committee also granted restricted stock unit awards (“RSUs”) to Synovus’ executive officers, including its named executive officers, effective March 14, 2012. The RSUs have a service component, a performance component and a TARP-related component for vesting. The units vest after each executive has three years of service and after Synovus has achieved two consecutive quarters of profitability during the term of these awards. In addition, as required under TARP, for each 25% of the aggregate TARP funds that are repaid, 25% of the units vest.
The table below sets forth the (1) base salaries for Synovus’ named executive officers, after giving effect to the foregoing salary increase, (2) the salary stock rate for each named executive officer for 2012, as granted by the Compensation Committee and (3) the number of RSUs awarded to Synovus named executive officers by the Compensation Committee:
| Name and Title | Base Salary |
2012 Salary Stock Rate |
Number of RSUs Granted (# of shares)
|
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| Kessel D. Stelling |
$ | 897,000 | $ | 269,100 | 284,415 | |||||||||
| Chairman, President and Chief Executive Officer |
||||||||||||||
| Thomas J. Prescott |
$ | 407,000 | $ | 122,100 | 129,049 | |||||||||
| Executive Vice President and Chief Financial Officer |
||||||||||||||
| Samuel F. Hatcher |
$ | 343,000 | $ | 102,900 | 108,757 | |||||||||
| Executive Vice President, General Counsel and Secretary |
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| Roy Dallis Copeland, Jr. |
$ | 331,000 | $ | 99,300 | 104,952 | |||||||||
| Executive Vice President and Chief Banking Officer |
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| Mark G. Holladay |
$ | 331,000 | $ | 99,300 | 104,952 | |||||||||
| Executive Vice President and Chief Risk Officer |
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| Item 9.01 | Financial Statements and Exhibits |
| (d) | Exhibits | |||
| Exhibit No. | Description | |||
| 10.1 | Form of Salary Stock Award Agreement | |||
Signature
Pursuant to the requirements of the Securities Exchange Act of 1934, as amended, Synovus has caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
| SYNOVUS FINANCIAL CORP. (“Synovus”) | ||||||
| Dated: March 16, 2012 | By: | /s/ Samuel F. Hatcher | ||||
| Samuel F. Hatcher | ||||||
| Executive Vice President, General Counsel and Secretary | ||||||
Exhibit 10.1
SYNOVUS FINANCIAL CORP.
2007 OMNIBUS PLAN
SALARY STOCK AWARD AGREEMENT
This Salary Stock Award Agreement (the “Agreement”) is made and entered into as of , 2012 by and between Synovus Financial Corp., a Georgia corporation (the “Company”), and the person named on Exhibit A (the “Grantee”) pursuant to the Company’s 2007 Omnibus Plan (the “Plan”). Capitalized terms not defined in this Agreement have the meanings ascribed to them in the Plan.
1. Grant of Stock Units. Pursuant and subject to the Plan and this Agreement, the Company agrees to grant as of the remaining bi-weekly payroll dates for services performed for the Company by the Grantee in 2012, a number of Restricted Stock Units (the “Stock Units”). The Stock Units will be calculated by dividing the bi-weekly salary stock cash value (the “Salary Stock Cash Value”) set forth on Exhibit A less applicable payroll taxes (e.g., FICA, Medicare and FUTA taxes) and dividing the net amount by the closing price of Synovus Financial Corp. common stock as of the applicable payroll date. The Stock Units will be immediately 100% vested upon the Grant Dates. Grantee’s of and rights with respect to the Stock Units are limited by the terms and conditions of the Plan and this Agreement, including restrictions on Grantee’s right to transfer the Stock Units.
2. Transfer Restriction. The Stock Units may not be sold, assigned, transferred, pledged or otherwise encumbered or disposed of except as specifically provided in the Plan or this Agreement.
3. Date of Payment. The Stock Units will be paid on February 15, 2013; provided Grantee has satisfied all applicable tax withholding obligations as provided in Section 5.1 below and the conditions of Sections 5.2 and 5.3 below have been satisfied. Upon the payment date, settlement shall be made in cash.
4. Termination of Employment; Termination of Right to Stock Units. In the event of Grantee’s death prior to the lapse of transfer restrictions of Section 3 above, the cash value of the vested Stock Units shall be paid as of the date one month following the date of death. Upon Grantee’s termination of employment for any other reason, the Stock Units that have not yet been paid as of the date of such termination shall remain subject to the provisions of Section 3 above. Grantee’s rights in respect of future grants of Stock Units shall immediately terminate upon termination of employment, except that Grantee shall be entitled to receive a final grant of Stock Units determined in accordance with Section 1 for any portion of Grantee’s Salary Stock Cash Value that had accrued through the date of termination of employment but had not yet been paid. In addition, Grantee’s right to future Stock Units under this Agreement will terminate on December 31, 2012.
| 5. | Conditions to Lapse of Transfer Restrictions. |
5.1 Tax Withholding. Prior to the lapse of transfer restriction on the Stock Units, Grantee must pay, or otherwise provide to the satisfaction of the Company, any applicable federal or state withholding obligations of the Company. Unless the Committee permits otherwise, Grantee shall provide for payment of withholding taxes (e.g., income taxes) upon the applicable payment date by hereby allowing and directing the Company to retain cash based on the Fair Market Value (determined as of the applicable payment date) equal to the statutory minimum amount of taxes required to be withheld. In such case, the Company shall pay the net cash amount to Grantee after such deduction.
5.2 Compliance with Laws. The transfer restrictions set forth in Section 2 above shall not lapse unless such lapse and the issuance or release of the related Stock Units is in compliance, to the reasonable satisfaction of the Committee, with all applicable federal and state laws, as they are in effect on the date of the lapse of restrictions.
5.3 Other Conditions. The Committee may require that Grantee comply with such other procedures relating to the lapse of transfer restrictions on the Stock Units and the release of shares of Common Stock to Grantee as the Committee may determine, including the manner in which Grantee shall satisfy tax withholding obligations with respect to the Stock Units.
6. Privileges of Stock Ownership. Grantee shall not have the rights of a stockholder with respect to voting or dividends until the settlement of the Stock Units.
7. Right of Offset. The Company shall have the right to offset against the obligation to settle the Stock Units, any outstanding amounts then owed by Grantee to the Company, but only to the extent such offset does not violate Section 409A of the Code.
8. Change in Control. Subject to the terms of the Plan, upon the occurrence of a Change in Control, the Stock Units shall be paid as soon as practicable thereafter to the extent permitted under applicable law, rules, regulation and guidance.
9. Administration, Interpretation and Construction. The terms and conditions set forth in this Agreement will be administered, interpreted and construed by the Compensation Committee, whose decisions will be final, conclusive and binding on the Company, on Grantee and on anyone claiming under or through the Company or Grantee. By accepting the transfer of Stock Units, Grantee irrevocably consents and agrees to the terms and conditions set forth in this Agreement and to all actions, decisions and determinations to be taken or made by the Compensation Committee in good faith pursuant to the terms and conditions set forth in this Agreement.
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10. Rights Not Assignable or Transferable. No rights under this Agreement will be assignable or transferable other than by will or the laws of descent and distribution, either voluntarily, or, to the full extent permitted by law, involuntarily, by way of encumbrance, pledge, attachment, levy or charge of any nature except as otherwise provided in this Agreement. Grantee’s rights under this Agreement will be exercisable during Grantee’s lifetime only by Grantee or by Grantee’s guardian or legal representative.
11. Terms and Conditions Binding. The terms and conditions set forth in the Plan and in this Agreement will be binding upon and inure to the benefit of the Company, it successors and assigns, including any assignee of the Company and any successor to the Company by merger, consolidation or otherwise, and Grantee, Grantee’s heirs, devisees and legal representatives. In addition, the terms and conditions set forth in the Plan and in this Agreement will be binding upon and inure to the benefit of Company’s agent and its successors and assigns.
12. No Employment Rights. No provision of this Agreement or the Plan will be deemed to confer upon Grantee any right to continue in the employ of the Company or a Subsidiary or will in any way affect the right of the Company or a Subsidiary to dismiss or otherwise terminate Grantee’s employment at any time for any reason with or without cause, or will be construed to impose upon the Company or a Subsidiary any liability which may result under this Agreement if Grantee’s employment is so terminated.
13. No Liability for Good Faith Business Acts or Omissions. Grantee recognizes and agrees that the Compensation Committee, the Board, or the officers, agents or employees of the Company and its Subsidiaries, in their oversight or conduct of the business and affairs of the Company and its Subsidiaries, may in good faith cause the Company or a Subsidiary to act, or to omit to act, in a manner that may, directly or indirectly, negatively affect the Stock Units. No provision of this Agreement will be interpreted or construed to impose any liability upon the Company, a Subsidiary, the Compensation Committee, Board, or any officer, agent or employee of the Company or a Subsidiary, that may result, directly or indirectly, from any such action or omission.
14. Recapitalization. In the event that Grantee receives, with respect to Stock Units, any securities or other property (other than cash dividends) as a result of any stock dividend or split, spin-off, recapitalization, merger, consolidation, combination or exchange of shares or a similar corporate change, any such securities or the property received by Grantee will likewise be held by Company’s agent and be subject to the terms and conditions set forth in this Agreement.
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15. Legal Representative. In the event of Grantee’s death or a judicial determination of Grantee’s incompetence, reference in this Agreement to Grantee shall be deemed, where appropriate, to Grantee’s heirs or devises.
16. Titles. The titles to sections or paragraphs of this Agreement are intended solely for convenience and no provision of this Agreement is to be construed by reference to the title of any section or paragraph.
17. Plan Governs. The Stock Units are being granted to Grantee pursuant to and subject to the Plan, a copy of which is available upon request to the Corporate Secretary of the Company. The provisions of the Plan are incorporated herein by this reference, and all capitalized terms in this Agreement shall have the same meanings given to such terms in the Plan. The terms and conditions set forth in this Agreement will be administered, interpreted and construed in accordance with the Plan, and any such term or condition which cannot be so administered, interpreted or construed will to that extent be disregarded.
18. Complete Agreement. This instrument contains the entire agreement of the parties relating to the subject matter of this Agreement and supersedes and replaces all prior agreements and understandings with respect to such subject matter. The parties hereto have made no agreements, representations or warranties relating to the subject matter of this Agreement which are not set forth herein or incorporated by reference.
19. Amendment; Modification; Waiver. No provision set forth in this Agreement may be amended, modified or waived unless such amendment, modification or waiver shall be authorized by the Compensation Committee and shall be agreed to in writing, signed by Grantee and by an officer of the Company duly authorized to do so. No waiver by either party hereto of any breach by the other party of any condition or provisions set forth in this Agreement to be performed by such other party will be deemed a waiver of a subsequent breach of such condition or provision, or will be deemed a waiver of a similar or dissimilar provision or condition at the same time or at any prior to subsequent time.
20. Governing Law. The validity, interpretation, performance and enforcement of the terms and conditions set forth in this Agreement will be governed by the laws of the State of Georgia, the state in which the Company is incorporated, without giving effect to the principles of conflicts of law of that state.
The Company has issued the Stock Units in accordance with the foregoing terms and conditions and in accordance with the provisions of the Plan. By signing below, Grantee hereby agrees to the foregoing terms and conditions of the RSUs.
IN WITNESS WHEREOF, Grantee has set Grantee’s hand and seal, effective as of the date and year set forth above.
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(L.S.) | |||
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