Additional Corporate Governance Information
More information about our corporate governance practices, documents and policies can be found on our website at https://www.southstatebank.com/ under the Corporate Governance tab of the Corporate Overview section under “Investor Relations,” including our: (i) Corporate Governance Guidelines; (ii) Code of Ethics; (iii) the charters of each of our Board committees and (iv) Insider Trading Policy. The Amended and Restated Bylaws of the Company were filed as Exhibit 3.1 to the Company’s Current Report on Form 8-K filed with the Securities and Exchange Commission (the “SEC”) on August 4, 2023. We will disclose any future amendments to these documents, as well as any waivers to our Code of Ethics, on our website as promptly as practicable, as and to the extent required under the Nasdaq and NYSE listing standards and applicable SEC rules.
This information is also available in print, free of charge, upon written request addressed to our Corporate Secretary at 1101 First Street South, Winter Haven, Florida 33880. Neither our website nor any of the documents noted above or available therein are incorporated by reference to this proxy statement.
Internet Availability of Proxy Materials
We mailed or emailed to most of our shareholders a Notice of Internet Availability of our proxy materials with instructions on how to access our proxy materials online and how to vote. If you are a registered holder and would like to change the method of delivery of your proxy materials, please contact our transfer agent, Computershare, P.O. Box 505000, Louisville, Kentucky 40233-5000; Toll free: (800) 568-3476; Foreign (781) 575-2879; or at www.computershare.com/investor. You may do the same as a beneficial owner by contacting the bank, broker, or other nominee where your shares are held.
Proxy Statement Availability
We are providing or making available this proxy statement to solicit your proxy to vote on the matters presented at our annual meeting. We commenced providing and making available this proxy statement on March 8, 2024. Our Board requests that you submit your proxy by the Internet, telephone, or mail so that your shares will be represented and voted at our annual meeting.
We will pay the cost of solicitation of proxies. Solicitation of proxies may be made in person or by mail, telephone or other means by directors, officers and regular employees of the Company without receiving additional compensation. We may also request banking institutions, brokerage firms, custodians, nominees and fiduciaries to forward solicitation materials to the beneficial owners of our common stock held of record by such persons, and we will reimburse the reasonable forwarding expenses.
2023 Change in Board Leadership
Effective as of April 26, 2023, as part of our ongoing effort to enhance the independence of our Board and overall governance structure that was initially put in place in connection with the CenterState Merger and was scheduled to expire by its terms in June 2023, the Company eliminated the role of Executive Chairman as an officer of the Company, as disclosed in the Company’s Current Report on Form 8-K filed with the SEC on March 3, 2023, and appointed Douglas J. Hertz as the independent Chair of the Board following Mr. Hill’s separation from the Company.
Identifying and Evaluating Director Candidates
As a result of our work with an outside governance consultant in 2022 and early 2023, which included an assessment of skills and experience represented by the directors currently serving on our Board, we have commenced a formal director succession process whereby we identify candidates for potential Board membership, with a specific focus on identifying and interviewing diverse candidates that (i) represent the customers and markets we serve, (ii) have the requisite skillset and experience necessary to meet our identified needs, and (iii) reflect experience earned from working with companies that have larger market capitalization than the Company, including other public companies, both within and outside the financial services industry. In addition, if appointed, our formalized process anticipates, to the extent possible, outgoing and incoming directors to have a period of service overlap to provide onboarding, training, and information sharing opportunities.
While the Governance and Nominating Committee has not established any specific, minimum qualifications that must be met for a person to be nominated to serve as a director, it does consider many factors, including the following:
| ✓ | Personal characteristics such as having an owner mentality, being committed and engaged, of high integrity and an independent thinker; |
| ✓ | Successful experience and expertise in relevant areas, including CEO or other c-suite experience at large publicly- and privately - owned companies, financial expertise, legal and risk management experience, audit/accounting expertise, HR/compensation expertise, entrepreneurial, and/or IT/FinTech experience; and |
| ✓ | Commitment to our success, reflected by the willingness and ability to commit the time necessary to perform the responsibilities of Board membership. |
The Board believes the current directors nominated for election in this Proxy Statement meet these qualifications. Potential new candidates for the Board, including those identified through the process summarized above, will be reviewed by the Governance and Nominating Committee and selected based on a number of criteria, including a proposed nominee’s independence, age, skills, occupation, diversity, experience and any other factors beneficial to the Company in the context of the needs of the Board. When evaluating candidates recommended by others (including shareholders of the Company), the Governance and Nominating Committee may also consider whether the candidate would represent the interests of all shareholders and not serve for the purpose of favoring or advancing the interests of any particular shareholder group or other constituency. See the discussion on page 74 captioned “Shareholder Proposals for our 2025 Annual Meeting” for additional information regarding nominating candidates for the Board of Directors.
Further, while our Board views diversity as a priority and seeks representation across a range of attributes, including qualified candidates of different gender, race, ethnicity, and professional experience, the Governance and Nominating Committee has not adopted a formal policy with regard to the consideration of diversity in identifying director nominees. The Governance and Nominating Committee members generally conceptualize diversity expansively to include, without limitation, concepts such as race, gender, age, national origin, differences of viewpoints, education, work experiences professional skills and other qualities or attributes that contribute to Board heterogeneity when identifying and recommending director nominees. The Governance and Nominating Committee, which oversees current and emerging environmental, corporate social responsibility, and governance (“ESG”) matters, believes that the inclusion of diversity as one of many factors considered in selecting director nominees is consistent with the goal of creating a Board of Directors that best serves our needs and the interest of our shareholders.
| ● | Our Company’s establishment, maintenance, and administration of appropriately designed compensation programs and plans, including approving annual goals for executives, evaluating performance of executives, and setting compensation for executives |
| ● | Our Company’s maintenance of high ethical standards and effective policies and practices to protect our reputation, assets, and business |
| ● | Our Company’s ESG objectives and initiatives |
| ● | Our corporate audit function, our independent registered public accounting firm, and the integrity of our consolidated financial statements |
| ● | Formal evaluation process of our Board and its committees which includes a peer-to-peer evaluation |
| ● | Director succession process that includes identification of director candidates, evaluation of such candidates, and nomination of qualified individuals for election to serve on our Board under a formal Governance and Nominating Committee process |
Director Independence
Both the Nasdaq and the NYSE listing standards require (a) a majority of our directors and (b) each member of our Audit Committee, Compensation Committee, and Governance and Nominating Committee to be independent. The Federal Reserve Board’s Enhanced Prudential Standards require the chair of our Risk Committee to be independent. In addition, our Corporate Governance Guidelines require a majority of our directors to be independent. Our Board considers directors or director nominees “independent” if they meet the criteria for independence in the Nasdaq or NYSE listing standards, as applicable (each, the “Listing Standards”).
On a quarterly basis, the Governance and Nominating Committee reviews the relevant relationships between each director/director nominee (and his or her immediate family members and affiliates) and the Company. The Governance and Nominating Committee also annually evaluates and affirms to the Board those directors that are considered independent under the Listing Standards. As a part of this evaluation process, the Governance and Nominating Committee considers, in addition to such other factors as it may deem appropriate, each director’s occupation, personal and affiliate transactions with the Company and its subsidiaries, and other relevant direct and indirect relationships with the Company that may affect independence.
On December 6, 2023, the Board of Directors of the Company determined to voluntarily withdraw the principal listing of the Company’s shares of common stock, $2.50 par value per share, from the Nasdaq and transfer the listing of its common stock to the NYSE as disclosed in the Company’s Current Report on Form 8-K filed with the SEC on December 8, 2023. The listing and trading of the Company’s common stock on Nasdaq ended at market close on December 18, 2023, and trading began on NYSE at market open on December 19, 2023. Any reference “Listing Standards” set forth in this Proxy Statement refers to the Listing Standards of the securities exchange, as applicable, listing the Company’s common stock as of the date to which such reference relates.
Pursuant to the annual certification process, on April 26, 2023, the Board affirmatively determined that the following directors/director nominees were independent under the Nasdaq Listing Standards:
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Ronald M. Cofield, Sr. | G. Ruffner Page, Jr. |
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Shantella E. Cooper | William K. Pou, Jr. |
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Jean E. Davis | James Roquemore |
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Martin B. Davis | David G. Salyers |
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Douglas J. Hertz | Joshua A. Snively |
In addition, the Board determined that each member of the Audit, Compensation, Governance and Nominating, and Risk Committees was independent in accordance with the Nasdaq Listing Standards, the Federal Reserve Board’s Enhanced Prudential Standards, the Company’s Corporate Governance Guidelines and/or applicable law, as applicable. Further, prior to the Company’s transition from its listing on the Nasdaq to its listing on the NYSE, the Company determined that (a) the 10 directors named in the table above and (b) each member of the Audit, Compensation, Governance and Nominating, and Risk Committees remained independent in accordance under the NYSE Listing Standards, the Federal Reserve Board’s Enhanced Prudential Standards, the Company’s Corporate Governance Guidelines, and/or applicable law, as applicable. Messrs. Corbett is not, and prior to his departure from the Company, Mr. Hill was not, considered independent due to their respective employment by our Company.
In making its independence determinations, our Board considered the following ordinary course, non-preferential relationships that existed during the preceding three years and those transactions reported under “Related Person and Certain Other Transactions” on
Director Education
The Company is committed to providing educational opportunities for the Board through presentations by various speakers at regularly scheduled Board meetings, conferences, online and virtual training and educational video series. Pursuant to the Company’s Corporate Governance Guidelines, the Company requires directors to complete a minimum of 6 hours of continuing education each year. Each director satisfied the 2023 continuing education requirement, which included outside-sponsored, regulator-sponsored, and Company - sponsored training related to regulatory and compliance developments, artificial intelligence, risk management, and market and economic developments.
Succession Planning
Board Leadership
The Governance and Nominating Committee is responsible for identifying and recommending director candidates to our Board for nomination using a director selection process after assessing the Company’s needs, evaluating the Board’s then-current composition, and recommending suggested enhancements.
Pursuant to our Corporate Governance Guidelines and Bylaws, except for any directors as to whom such age requirement has been waived, directors must not be over seventy-two (72) years of age at the time of the shareholders’ meeting at which the shareholders elect them. In the event that a director attains age seventy-two (72) during his or her term of office, he or she will serve until the end of his or her then-current term of office after his or her seventy-second (72nd) birthday.
Understanding that the Board and our directors are a strategic asset that necessitates a thoughtful approach to both identifying qualified candidates with the requisite character, integrity, and experience, and building a pipeline for leadership, the Company’s engagement of an outside governance consultant will include an assessment of the skills and experience represented by our directors to assist in implementing a succession plan for the Board of Directors that meets the needs of our Company.
As a result of our work with an outside governance consultant in 2022 and early 2023 which included an assessment of skills and experience represented by the directors currently serving on our Board, we have commenced a formal Board succession process, under which we identify and interview diverse and inclusive candidates that (i) are representative of the customers and markets we serve, (ii) have the requisite skillset and experience necessary to meet our identified needs, and (iii) reflect experience earned from working at a C-Suite level at companies with market capitalizations larger than SouthState, including other public companies, both within and outside the financial services industry. In addition, if appointed, our formalized process anticipates, to the extent possible, outgoing and incoming directors having a period of service overlap to provide onboarding, training, and information sharing opportunities.
CEO and Senior Management
Our Board, with the support of the Compensation Committee, oversees CEO and senior management succession planning. At the 2023 annual Board retreat, the Board approved enhanced CEO and executive leadership succession plans which identified the appropriate skill sets and experience to address the succession needs of the Company. The succession plan is designed to provide the Company with continuity in management to preserve its safe and sound operation and minimize potential disruption or loss of continuity to its business and operations in the event of loss of the CEO or other key management roles.
Board Oversight of Risk
Our Board and its committees play a key role in oversight of our culture, setting the “tone at the top” and holding management accountable for the maintenance of high ethical standards and effective policies and practices to protect our reputation, assets, and business. Our Board and its committees do this in a number of ways, including by focusing on the character, integrity, and qualifications of their respective members, and their respective leadership structures and composition; and overseeing management’s identification, measurement, monitoring, and control of our material risks. The Board also oversees risk through annual approval and oversight of the Risk Appetite Statement, and Enterprise Risk Management Framework and Program, Strategic Plan and budget and through its independent standing committees, principally the Audit Committee, the Risk Committee and the Compensation Committee as described below.
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Risk Governance Structure |
Our Board provides objective, independent oversight of risk and: ● receives quarterly updates from our Audit, Risk, Governance and Nominating, and Compensation Committees, providing our Board with a thorough understanding of how the Company manages risk; ● receives quarterly risk reporting from management, including a report that addresses and provides updates on key and emerging risks; ● oversees senior management's development and execution of the Enterprise Risk Management Framework and Program, Risk Appetite Statement, our capital, and strategic and financial operating plans, and our cyber security, Bank Secrecy, AML and OFAC and anti-fraud, compliance, customer complaint, and fair lending programs; ● oversees directly and through committees our financial performance and the adequacy of internal controls as monitored by management; and ● approves our Enterprise Risk Management Framework and Program and Risk Appetite Statement annually. |
Audit Committee Provides primary oversight of financial and accounting reporting; additional risk management oversight by evaluating the effectiveness of the Company's internal controls | Risk Committee Bears primary committee responsibility for overseeing the Enterprise Risk Management Framework and material risks facing the Company; receives regular updates from the Management Risk and Compliance Committees and their respective subcommittees on key and emerging risks | Compensation Committee Oversees the development of the Company's compensation plans and practices with a goal of rewarding performance without encouraging employees to engage in excessive, risky practices |
The full Board focuses on the risks that it believes to be the most significant facing the Company and our general risk management strategy. The full Board also seeks to ensure that risks undertaken by the Company are consistent with the Board’s approved risk appetite and risk management strategies. Through the oversight of the Company’s results compared to the Board-approved Strategic Plan and budget, the Board assesses whether management is implementing the Company’s strategy constituent with its core principles of soundness, profitability and growth and its other strategic priorities. While the Board oversees our risk management, management is responsible for the day-to-day risk management processes (first line), monitored by the independent risk management function (second line) and tested by internal audit (third line). We believe this division of responsibility is the most effective approach for addressing the risks facing our Company and that the Board’s leadership structure supports this approach.
Risk Governance Structure
Risk is inherent in all our business activities. As a result, we have developed a comprehensive approach to risk management by adopting a Risk Appetite Statement and an Enterprise Risk Management Framework supporting the Risk Appetite Statement.
The Risk Appetite Statement defines the aggregate levels and types of risk our Board and management believe appropriate to achieve our Company’s strategic objectives and business plan and has been set by our Board at an overall “Moderate” level.
The Enterprise Risk Management Framework sets forth clear roles, responsibilities, and accountability for the management of risk and describes how our Board oversees the monitoring of our risk appetite through the assessment of key risk indicators and performance factors. It outlines the eight types of risk that our Company faces: compliance risk, credit risk, operational risk (specifically including BSA/AML/OFAC and fraud risk, payments risk, cybersecurity risk and model risk), interest rate risk, liquidity risk, price risk, market risk, reputation risk, strategic risk and risks associated with the Bank’s correspondent, mortgage, factoring (Corporate Billing) and wealth lines of business. The Enterprise Risk Management Framework describes components of our risk management approach, including the
adoption of the three lines governance model and the implementation of a culture of managing risk through our risk management processes, with a focus on the role of all employees in managing risk. It also outlines our risk management governance structure, including the roles of our Board, management, lines of business (including first line risk functions), independent risk management as the second line, and internal audit as the third line within the governance structure.
On a quarterly basis, we evaluate the existing risk profiles facing the Company by risk categories, against the Risk Appetite Statement to ensure that actual operations of the Company align within the Company’s risk appetite, both overall and on an individual risk category basis. The Risk Appetite Statement and Enterprise Risk Management Framework are reviewed and approved by the Board annually. Independent Board oversight of the Risk Appetite Statement and Enterprise Risk Management Framework and independent assessment by the Board of our risk profile against our Risk Appetite and Framework on a quarterly basis enable us to better serve our customers, deliver long-term value for our shareholders, and achieve our strategic objectives.
Our Chief Risk Officer, the Company’s senior-most risk manager, has a dual reporting structure, reporting both to the Chief Executive Officer of the Company and to the Board Risk Committee. The Chief Audit Executive reports to the Audit Committee and for administrative purposes, the Chief Executive Officer. This governance structure is designed to complement our Board’s commitment to maintaining an objective, independent Board and committee leadership structure over risk and controls.
Board Oversight of Cybersecurity Risk
Our Board recognizes the importance of protecting the data provided by the Company’s customers, clients, and employees and devotes significant time and attention to overseeing the strategies the Company employs to protect our data and systems and to mitigate against cybersecurity risk.
We have a cross-departmental approach to identifying, assessing, and managing cybersecurity risk, including input from employees and our Board of Directors (the "Board"). The Board and its Risk and Audit Committees (respectively, the “Risk Committee” and the “Audit Committee”), as well as senior management in, among other areas, the information security, information technology, operations, and risk management (including enterprise and operational risk) areas, devote significant resources to cybersecurity and risk management processes to adapt to the changing cybersecurity landscape and to identify and respond to cybersecurity threats and incidents in a timely and effective manner. Our cybersecurity risk management program leverages the National Institute of Standards and Technology (NIST) framework, which organizes cybersecurity risks into five categories: identify, protect, detect, respond and recover. We regularly assess the threat landscape and take a holistic view of cybersecurity risks, with a layered cybersecurity strategy based on prevention, identification, and remediation. Our information technology and information security areas review enterprise risk management-level cybersecurity risks continually, and key cybersecurity risks are incorporated into the Company’s Enterprise Risk Management Framework that supports its Risk Appetite Statement. In addition, we have a set of Company-wide policies and procedures concerning cybersecurity matters, such as policies related to encryption standards, antivirus protection, remote access, multifactor authentication, confidential information, and the use of the internet, social media, email and wireless devices. These policies go through an internal review process and are approved by appropriate members of management. On an annual basis, the Board approves the Company’s Information Security Policy and Program which provides a layered approach to cybersecurity, and includes administrative, technical, and physical safeguards designed to protect the security, confidentiality, and integrity of customer information in accordance with applicable law.
The Company’s Chief Information Security Officer (“CISO”) is responsible for developing and implementing our information security program and reporting on cybersecurity matters to the Company’s Chief Risk Officer (“CRO”), who oversees and supervises the risk function, including the information security, compliance, legal, operational (which includes business continuity, model risk, and third-party risk functions) and enterprise risk areas.
The Board includes a cybersecurity expert who chairs the Risk Committee and provides technology-related insight and guidance to the Company. As part of the Risk Committee’s responsibility for monitoring key business and regulatory risks, the Risk Committee receives from our CISO quarterly reports and materials which include a review of cybersecurity and information technology key risk indicators, test results and related remediation, and any recent cybersecurity threats or incidents and how the Company is managing those threats or incidents. The Risk Committee also periodically reviews reports on the threat environment, vulnerability assessments, results of penetration testing, and potential cybersecurity and data privacy incidents, as well as information on ongoing employee training relating to data privacy and cybersecurity and how to protect data against cyber threats. Further, on a quarterly basis, our CRO presents to the Risk Committee updates from our Director of Enterprise and Operational Management on the Company’s business continuity program, which covers, among other things, outages and incidences and disaster recovery and business continuity testing. The Risk Committee also approves the annual risk assessment required by the Gramm-Leach-Bliley Act. Moreover, the CISO follows a risk-based escalation process to notify the Risk Committee outside of the cycle of regular updates when management has identified an emerging risk or material issue related to cybersecurity. The Risk Committee also reports material cybersecurity risks to the full Board, based on our CISO’s assessment of risk. In addition, the Audit Committee reviews reports of the Company’s internal audit department’s periodic audits of our information security area and various components thereof.
Board Oversight of Corporate Responsibility
The Governance and Nominating Committee has been given responsibility for overseeing current and emerging environmental, corporate social responsibility, and governance matters that are relevant to the business, operations, or public image of the Company or that are otherwise pertinent to the Company and its shareholders, employees, customers, and parties with whom it does business.
Recognizing the particular importance of attracting and retaining a diverse and talented workforce, the Company maintains a robust talent management program, offering training and career paths to all of its employees, as well as a Culture Council that oversees the Company’s cultural and human capital management initiatives, including its diversity and inclusion initiatives, community service activities, and talent attraction, motivation and retention. The Company’s Director of Corporate Stewardship, who reports directly to our CEO, leads our environmental, diversity and community development efforts and provides regular reports to the management executive committee and the Board Culture Committee. As a result of our efforts to make the Bank a place where employees can grow and learn, in 2023, the Bank was recognized in the following rankings: American Banker’s “Best Banks to Work For”, Columbia Regional Business Report’s Best Places to Work – South Carolina; Business Alabama’s Best Companies to Work for – Alabama, and Richmond Times Dispatch’s Top Workplaces – Richmond. In addition, according to our annual employee engagement survey, 83% of our employees indicated that they are engaged, up from 74% in 2022, as compared to 74% of employees in the financial services industry generally in the United States.
In 2021, the Company adopted a three-year diversity and inclusion plan built around three goals:
In addition, the Company formed the Diversity and Inclusion Council to provide oversight to its diversity and inclusion strategy, support the implementation of diversity and inclusion initiatives that align with its vision and core values, and promote a diverse and inclusive workplace that represents the communities in which the Bank does business. The Diversity and Inclusion Council is responsible for identifying and addressing barriers that impact recruitment, retention, and advancement of diverse candidates, defining benchmarks and metrics for diverse talent acquisition and retention, and identifying and implementing diversity and inclusion training for all Company employees and directors.
In 2022, we focused primarily on our implementation strategy for the three-year diversity and inclusion plan, which included discussing the diversity and inclusion plan with leadership throughout the Company to develop a mutual understanding and level of trust with local market leadership that would result in meaningful conversations and assist all stakeholders in viewing diversity from a number of perspectives. In addition, we established a small diversity and inclusion working group to help develop programs and initiatives in support of the action items outlined in the strategic plan. In collaboration with our Corporate Learning Department, in the fourth quarter of 2022, the Company engaged a third party to implement unconscious bias training throughout the Company. The unconscious bias training was first launched to the Board in late 2022, and as of December 31, 2023, has been completed by over 600 leaders, with plans to roll out the training to all team members through 2024.
As part of Corporate Stewardship's strategic plan, we announced several initiatives in 2023, including initiatives that continue to support the Company's Diversity & Inclusion plan. In the third quarter of 2023, the Director of Corporate Stewardship established several diversity metrics that would allow the Company to monitor its progress with recruitment, development, and retention of diverse talent, identify gaps, and allow us to focus our efforts accordingly. Beginning in 2024, SouthState's Diversity Metric Dashboard will track metrics related to (i) representation, (ii) internal talent mobility, (iii) voluntary versus involuntary employee turnover, and (iv) recruitment.
The Board Governance and Nominating Committee’s ESG program oversight also includes climate risk, and it receives regular reports on the progress of that implementation. In 2022, the Bank formed a climate steering committee composed of key finance, risk, credit, and ESG internal stakeholders, the purpose of which is to develop an integrated approach to identifying, analyzing, and monitoring climate change and other ESG factors relevant to the Bank and its operation, performance, and safety and soundness. In 2023, the climate steering committee continued to actively work toward developing the necessary structure to understand the Bank’s direct and indirect greenhouse gas scopes and emissions across the Company and to develop a process for undertaking climate risk assessments, and it engaged an outside consulting firm to assist it in developing this program. This consulting firm also assisted the Bank with identifying material ESG topics to enhance strategy and future reporting, conducted a disclosure gap analysis, and offered recommendations to enhance the Bank’s overall ESG performance.
In addition, the Bank has an active Business Continuity/Disaster Recovery Program designed to ensure the Bank’s capability to provide services for customers and to maintain viability before, during and after a business disruption. During 2023, the Business Continuity team monitored 20 named storms, and only one of these storms impacted our branch with little disruption in operations. Disaster recovery testing is conducted annually and tabletop exercises simulating climate, cyber, and other disruptive events are conducted several times each year with schedules varying by division.
Annually, the Company publishes a Corporate Social Responsibility Report setting forth its ESG accomplishments in the social responsibility areas during the previous year. A copy of the report is available for viewing on the Bank’s website, www.southstatebank.com.
Board Oversight of Risks Related to Financial Crimes and Fraud
Our Board recognizes the importance of complying with laws and regulations, including those applicable to financial crimes and fraud. As a regulated and publicly traded institution, the Company has adopted policies, procedures and internal controls as required by law and regulation, including the requirements imposed by the Sarbanes Oxley Act, the Bank Secrecy Act (“BSA”), and others. The Bank’s Financial Intelligence Unit monitors its compliance with BSA and Anti-Money Laundering (“AML”) laws and regulations, as well as the requirements of the Office of Foreign Assets Control (“OFAC”) relating to, among others, sanctions compliance, and oversees our anti - fraud programs, including investigations, reporting, trend and root cause analyses and mitigation efforts. Our training program requires directors, officers and employees to receive annual training on BSA, AML and OFAC policies and procedures in place to comply with these laws and regulations. As part of the Risk Committee’s responsibility for monitoring key business and regulatory risks, the Risk Committee reviews presentations and reports at each meeting on the Company’s BSA, AML and OFAC exposure, and its mitigation efforts. The Risk Committee also annually approves the Company’s BSA, AML, and OFAC Programs and the Company’s BSA/AML and OFAC Risk Assessment, setting forth the Company’s assessment of the risk of its operations, products, services and footprint for BSA, AML and OFAC compliance.
Compensation Governance and Risk Management
Compensation Governance
The Compensation Committee oversees the Company’s compensation plans and practices. The fundamental philosophy underpinning the Compensation Committee’s governance process is to reward NEOs and other executives for their performance in meeting the Company’s guiding principles of soundness, profitability and growth by pursuing strategies that are expected to maximize shareholder value over time without exposure to excessive risk. The Compensation Committee’s primary responsibilities include establishing goals, evaluating performance in light of the articulated goals and objectives, and setting compensation.
common stock with respect to which the deferral election was made (net of any shares withheld in respect of applicable tax withholding obligations, if any, related to vesting).
Deferrals credited under the deferred income plan are fully vested at all times and are payable (a) with respect to cash retainers, in cash in annual installments for a period of up to 10 years and/or (b) with respect to amounts deemed to be invested in Company common stock (including through the SouthState Corporation Stock Fund and any RSU accounts), in the form of common stock, following the first to occur of the participant’s separation from service or a change in control, subject to the director’s deferral elections.
Stock Retention Requirements, 10b5-1 Plans, and Hedging and Pledging Prohibitions
Stock Ownership Requirements. Directors are required to beneficially own a minimum of five times the director’s annual base cash retainer in market value of the Company’s common stock by the end of the fifth anniversary of being elected to the Board. Restricted stock and stock underlying or issuable pursuant to RSUs or the deferred income plan are counted toward these thresholds. After the threshold is attained, future changes in market value do not require the director to purchase additional stock. As of the end of 2023, all our directors have met or exceeded, or are in line to meet or exceed, their required ownership levels before their fifth anniversary of service commencement. Beneficially owned shares for these purposes include shares held by a director outright as well as unvested shares of restricted stock as to which a director has full voting privileges.
10b5-1 Rules. Our Insider Trading Policy currently contains guidelines for director and officer trading in Company stock, including prohibiting trades if the director or officer possesses material insider information. Our Insider Trading Policy also provides guidance on the adoption of 10b5-1 plans for directors and officers. A copy of our Insider Trading Policy can be found on our website at https://www.southstatebank.com/ under the Corporate Governance tab of the Corporate Overview under “Investor Relations.”
Anti-Hedging and Anti-Pledging Policies. Under our Insider Trading Policy, directors, officers and employees are prohibited from: (1) engaging in hedging, monetizing or similar transactions that are designed to offset a decrease in the market value of any securities of the Company and (2) holding securities of the Company in a margin account or otherwise pledging securities of the Company as collateral for a loan.
2023 Director Compensation
The following table shows the compensation paid to our 2023 non-management directors for their services in 2023:
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| | | Fees earned or | | | | | | All other | | | |
| | | paid in cash | | | Stock awards | | | compensation | | Total | |
Director | | | ($) (1) | | | ($) (2) | | | ($) | | ($) | |
Ronald M. Cofield, Sr. | | | 107,500 | | | 81,138 (3) | | | — | | 188,638 | |
Shantella E. Cooper | | | 87,500 (4) | | | 81,138 (3) | | | — | | 168,638 | |
Jean E. Davis | | | 87,500 | | | 81,138 | | | — | | 168,638 | |
Martin B. Davis | | | 105,000 | | | 81,138 | | | — | | 186,138 | |
Douglas J. Hertz | | | 140,000) | | | 81,138 | | | — | | 221,138 | |
G. Ruffner Page Jr. | | | 90,000 (3) | | | 81,138 (3) | | | — | | 171,138 | |
William Knox Pou, Jr. | | | 102,500 | | | 81,138 | | | — | | 183,638 | |
James W. Roquemore | | | 90,000 | | | 81,138 | | | — | | 171,138 | |
David G. Salyers | | | 118,000 | | | 81,138 | | | — | | 199,138 | |
Joshua A. Snively | | | 105,000 | | | 81,138 (3) | | | — | | 186,138 | |
(1)Includes total compensation earned through Board fees, retainers and committee fees, whether paid or deferred. Refer to the “Director Compensation – 2023 Director Pay” section for more information regarding committee membership and fees.
(2)RSUs were awarded to non-employee directors on May 1, 2023, in the amount of $85,000. These awards vested on November 1, 2023. The market value of the shares is determined by the closing market price of our common stock on the vesting date ($66.78 on November 1, 2023). The assumptions used in the calculation of these amounts for awards granted in 2023 are included in Note 19 in the “Notes to Consolidated Financial Statements” included within the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2023. None of our non-employee directors had any unvested stock awards outstanding as of December 31, 2023.
(3)Reflects amounts deferred under Nonemployee Directors Deferred Income Plan. Please refer to the section captioned “Director Compensation – Director Deferral Plan” beginning on page 30 for more information.
(4)Includes $67,500 deferred under the Nonemployee Directors Deferred Income Plan. Please refer to the section captioned “Director Compensation – Director Deferral Plan” beginning on page 30 for more information.
protections provided under the agreement were designed with the help of the Compensation Committee’s compensation consultant to reflect prevailing market practice within the context of the CenterState Merger.
If Ms. Brooks’ employment is terminated by reason of death or disability, she would be entitled to substantially the same payments and benefits as would be payable upon a termination without cause or for good reason, excluding the cash severance payment. She would not be entitled to the employer-paid medical and dental benefits described above in the case of disability, but her family would be entitled to such benefits for twelve months following death.
In consideration for the foregoing payments and benefits payable upon a termination of employment without cause or by Ms. Brooks for good reason, she is required to execute a release of claims. In addition, the employment agreement contains restrictive covenants concerning nondisclosure of confidential information at any time following a termination of employment, mutual non-disparagement of either party at any time following a termination of employment, non-competition for a period of one year following termination of employment, and non-solicitation of customers and employees for a period of two years following termination of employment. The severance benefits described above are also contingent on Ms. Brooks’ compliance with the restrictive covenants.
b. | CenterState Employment and Non-Competition Agreements assumed at CenterState Merger |
Messrs Corbett and Young
Prior to the CenterState Merger, CenterState was party to existing employment agreements with Messrs. Corbett, Matthews and Young which provided for payments in connection with a termination of employment or change in control of CenterState. The agreements were automatically assumed by and became agreements of the Company in connection with the CenterState Merger.
The completion of the CenterState Merger constituted a change in control under Mr. Corbett’s employment agreement and Mr. Young’s employment agreement, each dated as of July 13, 2010 (the “Grandfathered Agreements”). Each of these Grandfathered Agreements provided that the executive would receive, upon a change in control, in lieu of any other regular severance entitlement, a lump-sum cash payment equal to three times the highest annual compensation as reported on such executive’s Form W-2 over the three-year period immediately preceding the year in which the change in control occurred, and an additional payment to account for any excise tax payable under Sections 280G and 4999 of the Internal Revenue Code (including any associated taxes thereon).
In connection with the CenterState Merger in 2020, as described in prior proxy statements, Messrs. Corbett and Young entered into retention agreements (the “Retention Agreements”) pursuant to which they voluntarily agreed to waive the required change in control payment under their respective employment agreements and instead agreed to a structure, such that in the event of a termination of employment by the Company without “cause” or by the executive for “good reason” prior to June 7, 2023, or in the event of a subsequent change in control of the Company during the employment term, the executive would receive a lump sum cash payment equal to (i) the amount of the change in control payment that would have been payable under the terms of his existing agreement with CenterState (based on three times the highest annual compensation reported on the executive’s Form W-2 over the three-year period immediately preceding the year of the CenterState Merger and grossed up for excise tax under Section 280G of the Code) plus (ii) to comply with applicable tax requirements, an additional 25% of such change in control payment. In the event of a termination of employment by the Company without “cause” or by the executive for “good reason” after June 7, 2023, the executive would be eligible to receive severance in accordance with the terms of such executive’s employment agreement in effect prior to the CenterState Merger, which consists of (a) a lump-sum cash payment equal to one times the highest annual compensation as reported on the executive’s Form W-2 over the three-year period immediately preceding the year in which notice of employment termination is given and (b) continued employer-paid medical and dental insurance premiums for up to twelve months (including reimbursement for disability insurance coverage providing for a monthly benefit to age 65 not to exceed the lesser of (x) 60% of base salary or (y) $25,000 (and grossed up for taxes)).
In light of the successful integration of the CenterState Merger, in February 2024, the Company agreed with each of Messrs. Corbett and Young that the structure entered into in connection with the CenterState Merger was no longer necessary and terminated the Retention Agreements such that the terms governing a termination of employment or change in control as provided under the Grandfathered Agreements should continue in effect.
Messrs. Matthews and Murray
Each of Messrs. Matthews and Murray entered into employment agreements with CenterState in connection with NCOM’s merger with and into CenterState. In each case, the employment agreements entered into by Messrs. Matthews and Murray provide that if the NEO’s employment is terminated by CenterState Bank without “cause” or such NEO resigns for “good reason” without regard to a change in control, the NEO would receive a lump-sum cash payment equal to one and one-half times the sum of (i) base salary, and (ii) the target bonus earned for the year immediately preceding the year of termination; provided, that if such termination occurred within 12 months following a change in control, in lieu of the cash payment described in the immediately preceding sentence, such NEO would be entitled to a cash payment equal to two and one-half times the sum of (i) his base salary plus (ii) the highest annual bonus earned in the three years immediately preceding the year in which the change in control occurs. Each of Mr. Matthews and Murray will also be entitled to receive continued medical and dental insurance coverage at CenterState’s cost for the executive and his or her dependents and beneficiaries for a period up to the end of the employment term under the employment agreement. In addition, each of Mr. Matthews’ and Mr. Murray’s employment agreement includes such NEO’s covenant not to (i) solicit customers, accept the business of customers or sell customers a product or service of any other financial institution or (ii) compete with the Company in Alabama or metropolitan statistical
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| PROPOSAL 3: APPROVING THE AMENDED AND RESTATED 2020 OMNIBUS INCENTIVE PLAN |
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PROPOSAL 3: Approving THE AMENDED AND RESTATED 2020 OMNIBUS INCENTIVE PLAN
Proposal 3 asks shareholders to vote on a proposal to approve the Amended and Restated 2020 Omnibus Incentive Plan (the “Restated Plan”), which was adopted and approved by the Board on February 22, 2024, subject to shareholder approval. The purpose of the Restated Plan is to help the Company attract, retain and motivate directors, officers, employees and consultants of the Company and its subsidiaries who are or will be responsible for or contribute to the management, growth or profitability of the business of the Company and its subsidiaries by enabling such individuals to participate in the future success and growth of the Company and to associate their interests with those of the Company and its shareholders.
The primary changes to the Restated Plan are to:
| ● | add an additional 1,750,000 shares of common stock to the total shares available for delivery pursuant to awards granted under the Restated Plan, less one share for every one share granted under the Existing Plan after December 31, 2023, but before the effective date, which such shares are in addition to 914,169 shares of common stock that remained available for future grants under the Existing Plan as of December 31, 2023; and |
| ● | impose a limit on the aggregate value of all awards granted under the Restated Plan, together with the value of all cash compensation paid, in any calendar year to a non-employee member of the Board of $750,000 (which represents an expansion from the Existing Plan (as defined below) under which the value of awards granted to any non-employee member of the Board (not including cash compensation) in any calendar year could not exceed $200,000). |
The Restated Plan also includes a handful of housekeeping amendments, which do not require shareholder approval.
In connection with the design and adoption of the Restated Plan, the Board and Compensation Committee carefully considered the Company’s anticipated future equity needs, historical equity compensation practices, and the advice of the Compensation Committee’s independent compensation consultant. The Restated Plan, if approved, will amend and restate in its entirety the 2020 Omnibus Incentive Plan (the “Existing Plan”). The aggregate number of shares being requested for authorization under the Restated Plan is 1,750,000 shares, less one share for every share underlying an award granted after December 31, 2023, but before the effective date, which such shares are in addition to 914,169 shares remaining under the Existing Plan. Upon its adoption in 2020, the Existing Plan replaced the 2019 Omnibus Incentive Plan (the “2019 Plan”) and the 2012 Omnibus Stock and Performance Plan (the “2012 Plan” and together with the 2019 Plan, the “Prior Plans”), and as of the effective date of the Existing Plan, no new awards may be granted under the Prior Plans. However, any awards outstanding under the Prior Plans will continue to be outstanding and governed by the provisions of the applicable plan. If approved by shareholders at the 2024 annual meeting, the Restated Plan will become effective on that date.
If the Restated Plan is not approved by our shareholders, it will not be adopted, and we will continue to operate under the Existing Plan until it expires. In the event the Restated Plan is not approved, our flexibility will be limited with respect to our ability to provide incentives and reward employees and directors, to attract and retain such persons on a competitive basis and to align the interests of such persons with ours.On the approval and recommendation of our Compensation Committee, the Board adopted and approved the Restated Plan, subject to shareholder approval.
Outstanding Awards under Current Plans
As of December 31, 2023, we had 914,169 shares remaining available for grant under the Existing Plan, and the outstanding awards under all existing equity compensation plans were as set forth in the table below:
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Equity Compensation Plan | Stock Options exercisable to acquire common stock | Restricted Stock Awards | Restricted Stock Units (1) |
Existing Plan and Prior Plans | 75,705 (2) | 0 | 813,684 |
CenterState Equity Plans assumed by the Company (3) | 31,877 (4) | 751 | 91,344 |
Atlantic Capital Equity Plans assumed by the Company (5) | 0 | 15,497 | 10,859 |
Total | 107,582 | 16,248 | 915,887 |
| (1) | Includes outstanding PSUs at actual levels for awards granted on January 26, 2021 and at target levels for awards granted on January 19, 2022, and January 24, 2023. |
| (2) | Weighted-average exercise price of $84.46 per share and a weighted-average remaining contractual term of 3.0 years. |
| (3) | Pursuant to the CenterState Merger, the Company assumed all CenterState warrants, stock options, restricted stock awards and restricted stock units outstanding under CenterState’s equity plans. |
| (4) | Weighted-average exercise price of $44.45 per share and a weighted-average remaining contractual term of 2.7 years. |
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| PROPOSAL 3: APPROVING THE AMENDED AND RESTATED 2020 OMNIBUS INCENTIVE PLAN |
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Significant features | Description |
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| as the underlying award, and prohibits payment of dividend equivalents on restricted stock units unless and until those awards are earned and vested. |
No Transferability | All awards shall be nontransferable except by will or by the laws of descent and distribution, and no award shall be transferable to a third-party financial institution for value. |
Annual Limit on Compensation to Directors | The Restated Plan maintains an annual limitation on the value of awards granted to members of the Board and the total cash compensation earned or paid by such directors in any one calendar year of $750,000. |
No Change in Control/280G Tax Gross-Ups | The Restated Plan does not provide for any change in control-related excise tax gross-up payments or “parachute payments.” |
Independent Committee Administration | The Restated Plan will be administered by a committee of the board of directors comprised entirely of independent directors. |
Description of the Restated Plan
The following is a description of the Restated Plan. This description is qualified in its entirety by reference to the full text of the Restated Plan, which is attached as Appendix B to this Proxy Statement and incorporated herein by reference.
General. Awards granted under the Restated Plan may be in the form of non-qualified stock options, incentive stock options, SARs, restricted stock, restricted stock units, cash awards, other stock-based awards or any combination of those awards. The Restated Plan provides that awards may be made under the Restated Plan for ten years following the date on which the shareholders approved the Existing Plan, or September 30, 2030.
Administration. Under the terms of the Restated Plan, the Restated Plan will be administered by the Compensation Committee of the Board or such other committee as the board of directors may designate (the “committee”). The committee will consist of not fewer than two directors. Under the terms of the Restated Plan, the committee can make rules and regulations and establish such procedures for the administration of the Restated Plan as it deems appropriate. Any determination made by the committee under the Restated Plan will be made in the sole discretion of the committee and such determinations will be final and binding on all persons. The composition of the committee will be subject to such limitations as the Board deems appropriate to permit transactions pursuant to the Restated Plan to be exempt from Section 16(b) pursuant to rule 16b-3 under the Exchange Act.
Eligibility. The Restated Plan provides for awards to the directors, officers, employees and consultants of the Company and its subsidiaries and affiliates. As of December 31, 2023, the Company had approximately 10 non-employee directors, 5,091 employees (including seven executive officers), and no consultants. The Company has traditionally not granted equity awards to consultants and has no current intention to do so. The basis for participation in the Restated Plan is the Compensation Committee’s decision, in its sole discretion, that an award to an eligible participant will further the Restated Plan’s purposes, as described above. In exercising its discretion, the Compensation Committee will consider the recommendations of management and the purposes of the Restated Plan.
Shares Available. The Restated Plan provides that the aggregate number of shares of the Company’s common stock available for delivery pursuant to awards granted under the Restated Plan after its adoption is 1,750,000 shares, less one share for every one share granted under the Existing Plan after December 31, 2023, but prior to the date the Restated Plan is approved by shareholders, which such shares are in addition to 914,169 shares of common stock that remained available for future grants under the Existing Plan as of December 31, 2023. The maximum number of shares that may be granted pursuant to incentive stock options under the Restated Plan is 1,750,000.
As described above, from and following the date the Existing Plan was approved by the shareholders, no new awards may be granted under the Plan or any other Prior Plan. However, awards previously granted and outstanding under the Prior Plans will remain in full force and effect under such plans according to their respective terms, and to the extent that any such award is forfeited, terminates, expires or lapses without being exercised (to the extent applicable), or is settled for cash, shares of common stock of the Company subject to such award which are not delivered as a result will be available for awards under the Restated Plan.
Shares underlying awards that expire or are forfeited or terminated without being exercised or awards that are settled for cash will again be available for the grant of additional awards within the limits provided by the Restated Plan. Shares withheld by or delivered to the Company to satisfy the exercise price of options or SARs or tax withholding obligations with respect to any award granted under the Restated Plan will nonetheless be deemed to have been issued under the Restated Plan and will not again be available for issuance under the Restated Plan. Shares purchased on the open market with the proceeds of the exercise price of an option shall not be available for issuance in connection with other awards under the Restated Plan.
Stock Options. Subject to the terms and provisions of the Restated Plan, options to purchase shares of Company common stock may be granted to eligible individuals at any time and from time to time as determined by the committee. An option may be granted with or
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PROPOSAL 3: APPROVING THE AMENDED AND RESTATED 2020 OMNIBUS INCENTIVE PLAN | |
without a related SAR. Options may be granted as incentive stock options, which are intended to qualify for favorable treatment to the recipient under Federal tax law, or as non-qualified stock options, which do not qualify for this favorable tax treatment. Subject to the limits provided in the Restated Plan, the committee determines the number of options granted to each recipient. Each option grant will be evidenced by a stock option agreement that specifies the option exercise price, whether the options are intended to be incentive stock options or non-qualified stock options, the duration of the options, the number of shares to which the options pertain, the vesting terms and such additional limitations, terms and conditions as the committee may determine.
The committee determines the exercise price for each option granted, except that the option exercise price may not be less than 100% of the fair market value of a share of Company common stock on the date of grant. As of December 31, 2023, the fair market value (as that term is defined under the Restated Plan) of a share of Company common stock was $84.45. All options granted under the Restated Plan will expire no later than 10 years from the date of grant. The methods of exercising an option granted under the Restated Plan is set forth in the Restated Plan. Stock options are nontransferable except by will or by the laws of descent and distribution. The granting of an option does not accord the recipient the rights of a shareholder, and such rights accrue only after the exercise of an option and the registration of shares of Company common stock in the recipient’s name.
Stock Appreciation Rights. A SAR will entitle the holder to receive, with respect to each share of Company common stock covered by the SAR, the amount by which the fair market value of one share of Company common stock at the time of exercise exceeds the fair market value of one share of Company common stock on the date of grant. A SAR may be granted with or without a related option. The exercise price of a SAR shall not be less than 100% of the fair market value of a share of Company common stock on the date of grant. All SARs granted under the Restated Plan will expire no later than ten years from the date of grant.
Each SAR will be evidenced by an award agreement that specifies the exercise price (or base price), the number of shares to which the SAR pertains and such additional limitations, terms and conditions as the committee may determine. The Company may make payment of the amount to which the participant exercising SARs is entitled by delivering shares of Company common stock, cash or a combination of common stock and cash as set forth in the award agreement relating to the SARs. The method of exercising a SAR granted under the Restated Plan is set forth in the Restated Plan. SARs are not transferable except by will or the laws of descent and distribution. Each SAR will be evidenced by an award agreement that specifies the date and terms of the award and such additional limitations, terms and conditions as the committee may determine.
Restricted Stock. The Restated Plan provides for the award of shares of Company common stock that are subject to forfeiture and restrictions on transferability as set forth in the Restated Plan and as may be otherwise determined by the committee. Each grant of restricted stock will be evidenced by an award agreement that specifies the number of shares of restricted stock and such additional limitations, terms and conditions as the committee may determine. Except for these restrictions and any others imposed by the committee, upon the grant of restricted stock, the recipient will have rights of a shareholder with respect to the restricted stock, including the right to vote the restricted stock and to receive all dividends and other distributions paid or made with respect to the restricted stock (which dividends relating to restricted stock subject to performance vesting conditions will only vest upon the vesting of the restricted stock relating to such dividends). During the restriction period set by the committee, the recipient may not sell, transfer, pledge, exchange or otherwise encumber the restricted stock.
Restricted Stock Units. The Restated Plan authorizes the committee to grant restricted stock units and deferred share rights. Restricted stock units and deferred share rights are not shares of Company common stock and do not entitle the recipients to the rights of a shareholder. Each grant of restricted stock units will be evidenced by an award agreement that specifies the number of restricted stock units and such additional limitations, terms and conditions as the committee may determine. Restricted stock units granted under the Restated Plan may or may not be subject to performance conditions. The committee may provide for dividend equivalents; provided, however, that dividend equivalents credited with respect to any award of restricted stock units shall be subject to the same vesting conditions applicable to such award and shall, if vested, be delivered or paid at the same time as such award. The recipient may not sell, transfer, pledge or otherwise encumber restricted stock units granted under the Restated Plan prior to their vesting. Restricted stock units will be settled in cash or shares of Company common stock, in an amount based on the fair market value of Company common stock on the settlement date.
Cash Awards. The Restated Plan provides for the award of cash awards on such terms and conditions determined by the committee, including, without limitation, performance goals that must be satisfied and the applicable performance period.
Other Stock-Based Awards. The Restated Plan also provides for the award of shares of Company common stock and other awards that are valued by reference to Company common stock, including unrestricted stock, dividend equivalents and convertible debentures.
Treatment of Awards upon Change of Control. Upon the occurrence of a change of control (as defined below), the committee may, in its sole discretion, take one or more of the following actions with respect to outstanding awards under the Restated Plan: (a) continuing or assumption such awards by the Company or the successor or surviving entity; (b) substituting or replacing awards by the successor or surviving entity; (c) accelerating the vesting or exercisability of awards and the lapse of restrictions thereon upon either (i) a participant’s termination of service by the Company other than for cause or by the participant for good reason, in each case on or within 24 months following the change of control, or (ii) upon the failure of the successor or surviving entity to replace the award with an award of equal value; (d) determining the level of attainment of applicable performance conditions; and (e) cancelling awards in consideration of a
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| PROPOSAL 3: APPROVING THE AMENDED AND RESTATED 2020 OMNIBUS INCENTIVE PLAN |
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payment equal to the value of the award, as determined by the committee in its discretion (which, in the case of an option or a SAR, may be equal to the intrinsic value of such award). Under the Restated Plan, a “change of control” will be deemed to have taken place if:
| ● | any person (as such term is used in Sections 13(d) and 14(d) of the Exchange Act (other than certain customary exceptions) acquires 30% or more of the combined voting power of the Company’s then outstanding stock; |
| ● | any merger consolidation or similar transaction involving the Company or any of its subsidiaries, a sale of all or substantially all of the assets of the Company or the acquisition of assets or securities of another entity by the Company or any of its subsidiaries unless following the transaction all or substantially all of the beneficial owners of the Company’s outstanding voting securities continue to own at least 50% of the combined voting power of the resulting entity; |
| ● | during any period of two consecutive years there is a change in the majority of the incumbent members of the Company’s board of directors (other than through election or nomination for election was approved by a vote of at least two-thirds of the directors then still in office who are incumbent directors); or |
| ● | shareholder approval of the complete liquidation or dissolution of the Company. |
Amendment. The committee may amend, alter, or discontinue the Restated Plan or an award, but no amendment, alteration or discontinuation will be made that materially impairs the rights of a participant with respect to a previously granted award without such participant’s consent, except such an amendment made to comply with applicable law, including without limitation Section 409A of the Code, stock exchange rules or accounting rules. In addition, no such amendment will be made without the approval of the Company’s shareholders (a) to decrease the exercise price of any stock option or SAR, or to take any other action that would be treated under applicable exchange listing standards or for accounting purposes as a repricing of such stock option or SAR, or (b) to the extent such approval is required by applicable law or the listing standards of the applicable stock exchange.
Clawback. Any award granted under the Restated Plan will be subject to the terms of any clawback or recoupment policy that the Company has adopted or may in the future adopt that, by its terms, is applicable to such award.
Federal Income Tax Consequences
The following discussion briefly summarizes certain U.S. federal income tax consequences of awards under the Restated Plan. The discussion is based upon current interpretations of the Code, and the regulations promulgated thereunder as of such date. This summary describes the general tax principles that apply and is provided only for general information. Certain types of taxes, such as state and local income taxes, are not discussed. Tax laws are complex and subject to change and may vary depending on individual circumstances and from locality to locality. The summary does not discuss all aspects of income taxation that may be relevant to a participant in light of his or her personal investment circumstances. This summarized tax information is not tax advice.
Non-Qualified Stock Options. A participant will not recognize taxable income at the time of grant of a non-qualified stock option, and the Company will not be entitled to a tax deduction at such time. A participant will recognize compensation taxable as ordinary income (and subject to income tax withholding in respect of an employee) upon exercise of a non-qualified stock option equal to the excess of the fair market value of the shares purchased over their exercise price, and the Company generally will be entitled to a corresponding deduction, except to the extent the deduction limits of Section 162(m) of the Code.
Incentive Stock Options. A participant will not recognize taxable income at the time of grant of an incentive stock option. A participant will not recognize taxable income (except for purposes of the alternative minimum tax) upon exercise of an incentive stock option. If the shares acquired by exercise of an incentive stock option are held for the longer of two years from the date the option was granted and one year from the date the shares were transferred, any gain or loss arising from a subsequent disposition of such shares will be taxed as long-term capital gain or loss, and the Company will not be entitled to any deduction. If, however, such shares are disposed of within such two- or one-year periods, then in the year of such disposition the participant will recognize compensation taxable as ordinary income equal to the excess of the lesser of the amount realized upon such disposition and the fair market value of such shares on the date of exercise over the exercise price, and the Company generally will be entitled to a corresponding deduction. The excess of the amount realized through the disposition date over the fair market value of the stock on the exercise date will be treated as capital gain.
SARs. A participant will not recognize taxable income at the time of grant of a SAR, and the Company will not be entitled to a tax deduction at such time. Upon exercise, a participant will recognize compensation taxable as ordinary income (and subject to income tax withholding in respect of an employee) equal to the fair market value of any shares delivered and for the amount of cash paid by the Company, and the Company will generally be entitled to a corresponding deduction, except to the extent the deduction limits of Section 162(m) of the Code.
Restricted Stock. A participant will not recognize taxable income at the time of grant of shares of restricted stock, and the Company will not be entitled to a tax deduction at such time, unless the participant makes an election under Section 83(b) of the Code to be taxed at the time of grant. If such election is made, the participant will recognize compensation taxable as ordinary income (and subject to income tax withholding in respect of an employee) at the time of grant equal to the excess of the fair market value of the shares at such time over the amount, if any, paid for such shares. If such election is not made, the participant will recognize compensation taxable as ordinary income (and subject to income tax withholding in respect of an employee) at the time the restrictions lapse in an amount equal to the excess of the fair market value of the shares at such time over the amount, if any, paid for such shares. The Company is entitled to a
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| PROPOSAL 4: RATIFYING THE APPOINTMENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM FOR 2024 |
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PROPOSAL 4: RATIFYING THE APPOINTMENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM FOR 2024
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| Our Board recommends a vote “FOR” ratifying the appointment of our independent registered public accounting firm for 2023 (Proposal 4) |
Our Audit Committee is directly responsible for the appointment, compensation, retention, and oversight of our independent registered public accounting firm.
The Committee engages in an annual evaluation of the independent registered public accounting firm. It considers, in particular, whether the retention of the firm is in the best interests of our Company and its shareholders, taking into account the firm’s quality of service, the firm’s institutional knowledge and experience, our Company’s operations and businesses, the firm’s sufficiency of resources, the quality of the communication and interaction with the firm, and the firm’s independence, objectivity, and professional skepticism. The Committee also considers the advisability and potential impact of selecting a different independent registered public accounting firm.
From 2007 through 2022, FORVIS, LLP (formerly known as Dixon Hughes Goodman LLC) (“FORVIS”) served as the Company’s independent registered public accounting firm. Beginning January 1, 2023, Ernst & Young LLP (“EY”) has served as the Company’s as independent registered public accounting firm. The Audit Committee has assessed the qualifications, performance, and independence of Ernst &Young LLP (“EY”) and believes that retaining EY is in the best interests of our Company.
The Committee has appointed EY as our independent registered public accounting firm to audit the 2024 consolidated financial statements of the Company and its subsidiaries. Although it is not required to do so, our Board is asking shareholders to ratify EY’s appointment. If our shareholders do not ratify EY’s appointment, the Committee will consider changing our independent registered public accounting firm for 2024. Whether or not shareholders ratify EY’s appointment, the Committee may appoint a different independent registered public accounting firm at any time if it determines that such a change is appropriate.
EY has advised the Committee that it is an independent accounting firm with respect to our Company and its affiliates in accordance with the requirements of the SEC and the Public Company Accounting Oversight Board.
Representatives of EY are expected to be present at our annual meeting, will have an opportunity to make a statement if they choose, and are expected to be available to respond to appropriate shareholder questions.
Fees for Professional Services for 2023 and 2022. The aggregate fees for professional services provided by EY for 2023 and FORVIS for 2022, as applicable, were:
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| | | EY 2023 | | | FORVIS 2022 |
Audit Fees | | | 2,425,100 | | | 1,735,998 |
Audit-Related Fees | | | 40,000 | | | 126,315 |
Tax Fees | | | 331,045 | | | — |
All Other Fees | | | — | | | — |
Total Fees | | | 2,796,145 | | | 1,862,313 |
Audit fees. Audit fees relate to the integrated audit of our consolidated financial statements, and internal control over financial reporting, including disclosures presented in the footnotes to our Company’s financial statements (for example, regulatory capital, among other disclosures). Audit fees also relate to the audit of domestic and international and subsidiary financial statements, the review of our interim consolidated financial statements, and SEC consents, and services provided in connection with certain agreed-upon procedures and other attestation reports. Audit fees are those billed or expected to be billed for audit services related to each fiscal year.
Audit-related fees. Audit-related fees cover other audit and attest services, services provided in connection with certain agreed-upon procedures and other attestation reports, financial accounting, reporting and compliance matters, benefit plan audits, and risk and control reviews. Fees for audit-related services are those billed or expected to be billed for services rendered during each fiscal year. For 2023, the Company paid EY audit-related fees only in connection with EY’s audit of the SouthState Bank 401(K) Retirement Savins Plan for the year ended December 31, 2023.
Tax fees. Tax fees cover tax compliance, advisory, and planning services and are those billed or expected to be billed for services rendered during each fiscal year.
All other fees. “All Other Fees” consists primarily of amounts billed or expected to be billed for the Company’s engagement of our independent audit firm to provide guidance in connection with regulatory commitments. The Company did not have any such engagements for 2022 or 2023.
AUDIT COMMITTEE REPORT
This report of the Audit Committee is required by the SEC and, in accordance with the SEC’s rules, will not be deemed to be part of or incorporated by reference by any general statement incorporating by reference this Proxy Statement into any filing under the Securities Act of 1933, as amended (the “Securities Act”), or under the Exchange Act, except to the extent that we specifically incorporate this information by reference, and will not otherwise be deemed “soliciting material” or “filed” under with the Securities Act or the Exchange Act.
Our Audit Committee is composed of five Board members. Our Board has determined that all Committee members are independent under the Nasdaq and NYSE Listing Standards and applicable SEC rules and regulations. Our Board has also determined that the Chair of the Committee, Mr. Cofield, qualifies as an “audit committee financial expert” as defined by SEC rules. The Committee’s responsibilities are stated in a written charter adopted by our Board.
Management is responsible for preparing and the overall reporting process with respect to our Company’s consolidated financial statements, and, with the assistance of our Company’s internal corporate auditors, for establishing, maintaining, and assessing the effectiveness of our internal control over financial reporting. EY, our Company’s 2023 independent registered public accounting firm, is responsible for planning and conducting an independent audit of our Company’s 2023 consolidated financial statements in accordance with the standards of the United States Public Company Accounting Oversight Board (PCAOB) and for expressing an opinion as to the conformity of these financial statements with accounting principles generally accepted in the United States of America and as to the effectiveness of our internal controls over financial reporting. The Committee’s responsibility is to monitor and oversee these processes.
The Committee annually evaluates the qualifications, performance, and independence of its independent public accounting firm. The Committee also oversees the performance of the corporate audit function managed by our Chief Audit Executive. The Committee has reviewed and discussed with management and with EY our Company’s audited financial statements for the year ended December 31, 2023, management’s assessment of the effectiveness of our Company’s internal control over financial reporting, and EY’s evaluation of our Company’s internal control over financial reporting. In addition, the Committee has discussed with EY the matters that independent registered public accounting firms must communicate to audit committees under applicable PCAOB standards.
The Committee has also discussed and confirmed with EY its independence from our Company and received the written disclosures and a letter required by applicable requirements of the PCAOB regarding the independent accountant’s communications with the Audit Committee concerning independence. The Committee has evaluated and concluded the non-audit services provided by EY to our Company do not impair EY’s independence.
Based on the reviews and discussions referred to above, the Committee recommended to our Board that the audited financial statements for the year ended December 31, 2023, and the related footnotes be included in our Company’s annual report on Form 10-K for the year ended December 31, 2023.
This report is provided by the undersigned directors, who serve on the Audit Committee as of the date of this Proxy Statement and who served on the Audit Committee during 2023.
| |
| Submitted by the Audit Committee of the Board: |
| |
| Ronald M. Cofield, Sr., Chair |
| Martin Bernard Davis |
| G. Ruffner Page, Jr. |
| James W. Roquemore |
| Joshua A. Snively |
SHAREHOLDER PROPOSALS FOR OUR 2025 ANNUAL MEETING
Under Rule 14a-8 of the Exchange Act, any proposal that a shareholder may intend to present at the 2025 Annual Shareholders’ Meeting (the “2025 Annual Meeting”) must be received in writing by the Secretary of the Company at its principal executive office located at 1101 First Street South, Winter Haven, Florida 33880, no later than 120 calendar days before the first anniversary of the release date of the proxy statement for the 2024 annual shareholders’ meeting (the “2024 Annual Meeting”); provided, that if the date of our 2025 Annual Meeting has been changed by more than 30 days before the one year anniversary of the 2024 Annual Meeting, or April 24, 2024, we must receive the proposal within a reasonable time before we begin to print and send the proxy materials.. We currently anticipate that we will hold our 2025 Annual Meeting on April 23, 2025. As a result, we must receive any such proposal no later than the close of business on November 8, 2024. Any such proposal must comply with the procedural, informational and other requirements outlined in our Bylaws. If the proposal complies with all the requirements of Rule 14a-8, the proposal will be considered for inclusion in the Company’s proxy statement relating to such meeting.
Under our Bylaws, shareholder proposals intended to be raised at the 2025 Annual Meeting outside of Rule 14a-8, including nominations for election of director(s), must be received in writing by the Secretary of the Company, at 1101 First Street South, Winter Haven, Florida 33880, no earlier than 120 days and no later than 90 days prior to the one year anniversary of our 2024 Annual Meeting, or April 24, 2024, unless the date of our 2025 Annual Meeting is more than 30 days before the one year anniversary of April 24, 2024. Given that we anticipate holding the 2025 Annual Meeting on April 23, 2025, we must receive any such proposal no later than the close of business on January 24, 2025, but no earlier than December 25, 2024, and any such proposal must comply with the procedural, informational and other requirements outlined in our Bylaws.
The Governance and Nominating Committee will consider director nominees identified by its members, other directors, our officers and employees and other persons, including our shareholders. To be considered by the Nominating Committees, any recommendation by a shareholder of a candidate for director must be addressed to the Governance and Nominating Committee and must contain the information called for by the Corporate Governance Guidelines, the Governance and Nominating Committee Charter, and the Bylaws of the Company, which includes all of the following information about the recommended candidate:
| ● | With respect to each such nominee, his or her name and age, all positions held with the Company, any other business experience, other directorships held, material legal proceedings within the past 10 years, the number of Company shares beneficially owned, and any transactions between the Company and such person; |
| ● | a description of all relationships between the recommended candidate and the recommending shareholder or group and any agreements or understandings between the candidate and the recommending shareholder or group regarding the nomination; |
| ● | a description of all known relationships between the recommended candidate and any of the Company’s competitors, customers, business partners or other persons who have a business relationship with the Company; |
| ● | a statement of the recommended candidate’s qualifications for Board membership; and |
| ● | a statement that the recommended candidate meets the independence requirements of the NYSE listing standards for Company directors and the independence requirements for the members of the Audit, Compensation, Risk, and Governance and Nominating Committees of the Board (or a description of each factor that could prevent the recommended candidate from meeting any such independence requirements). |
The Governance and Nominating Committee may require that any recommended candidate complete one or more questionnaires or otherwise provide additional information. See page v for information on how to obtain copies of our Corporate Governance Guidelines, the Governance and Nominating Committee Charter, and the Bylaws of the Company.
In addition to complying with the provisions of the Corporate Governance Guidelines, the Governance and Nominating Committee Charter, and the Bylaws of the Company, to nominate a director, shareholders must give timely notice that complies with the additional requirements of Rule 14a-19 under the Exchange Act, which must be received no later than February 24, 2025.
The Governance and Nominating Committee does not intend to alter the manner in which it evaluates candidates, including the minimum criteria set forth above, based on whether the candidate was recommended by a shareholder or not.
We encourage shareholders that are contemplating submitting a proposal for inclusion in our proxy statement to contact us beforehand at the address above to allow for a constructive discussion of their concerns and for additional information about our practices or policies.
VOTING AND OTHER INFORMATION
Who Can Vote. Only holders of record at the close of business on February 28, 2024 (the record date) will be entitled to notice of and to vote at our annual meeting. As of February 28, 2024, the following shares were outstanding and entitled to vote:
Shares | Number of shares
outstanding and
entitled to vote |
Common Stock | 76,149,892 |
Each share of our common stock is entitled to one vote.
Voting Information for Registered Holders. If you are a registered holder, meaning that you hold our shares directly (not through a bank, broker, or other nominee), you may vote in person at our annual meeting or by submitting your proxy by:
| | |
| Internet | going to www.proxyvote.com and following the online instructions. You will need information from your Notice of Internet Availability or proxy card, as applicable, to submit your proxy |
| Phone | calling the phone number located on the top of your proxy card and following the voice prompts. You will need information from your proxy card to submit your proxy |
| Mail | (If you received your proxy materials by mail): marking your vote on your proxy card, signing your name exactly as it appears on your proxy card, dating your proxy card, and returning it in the envelope provided |
To be counted, your proxy must be received before the polls close at our annual meeting. All shares represented by valid proxies that we receive through this solicitation, and that are not revoked, will be voted according to your voting instructions. If you properly submit a proxy without giving specific voting instructions, your shares will be voted in accordance with our Board’s recommendations. If other matters properly come before our annual meeting, the proxies will vote on these matters.
You may revoke your proxy and change your vote at any time before the voting polls close at our annual meeting by submitting a properly executed proxy of a later date, a written notice of revocation (of your previously executed proxy) sent to our Corporate Secretary, or a vote cast in person at our annual meeting (however, attending the meeting without voting will not revoke a proxy).
Voting Information for Beneficial Owners. If you are a beneficial owner, meaning that you hold our stock in the name of a bank, broker, or other nominee (commonly referred to as holding shares in “street name”), you should have received these proxy materials from your bank, broker, or other nominee by mail or email with information on how to submit your voting instructions, including by:
| | |
| Internet | going to www.proxyvote.com and following the online instructions |
| Phone | calling the phone number located on the top of your voting instruction form (VIF) and following the voice prompts |
| Mail | (if you received your proxy materials by mail): marking your vote on your VIF, signing your name (exactly as it appears on the VIF), and dating, and returning your VIF in the envelope provided |
Voting by telephone and the Internet ends at 11:59 p.m. Eastern time on April 23, 2024. As a beneficial owner, if you do not provide voting instructions to your bank, broker, or other nominee, your shares will be treated as a “broker non-vote” with respect to Proposals 1, 2 and 3, and may be voted in the discretion of your bank, broker, or other nominee solely on Proposal 4 as described under “Votes Required” below. To change any of your previously provided voting instructions, or if you have questions about voting your shares, please contact your bank, broker, or other nominee directly.
You may revoke any voting instructions you provided by following the specific directions from your bank, broker, or other nominee to change or revoke any voting instructions you have already provided. Alternatively, you may vote your shares by ballot at the annual meeting if you obtain a legal proxy from your bank, broker, or other nominee and present it at the annual meeting.
Employee Voting. If you participate in Company’s 401(k) Plan or the Company’s Deferred Compensation Plan, (collectively, the Plan), and your Plan account has investments in shares of our common stock, you must provide voting instructions to the Plan trustee (the Trustee) (by the Internet, telephone, or proxy card) for your shares to be voted according to your instructions. Your shares cannot be voted unless you provide voting instructions to the Trustee. Your voting instructions to the Trustee will be held in strict confidence. The deadline to provide voting instructions for shares held in the Plan is April 21, 2024, at 11:59 p.m., Eastern time. If you are an employee and you hold shares in multiple accounts, you may receive one proxy card covering all the shares in your accounts. If you receive one proxy card covering all the shares in your accounts, you must provide voting instructions by April 21, 2024, at 11:59 p.m., Eastern time,
Pay vs Performance Disclosure - USD ($)
|
12 Months Ended |
Dec. 31, 2023 |
Dec. 31, 2022 |
Dec. 31, 2021 |
Dec. 31, 2020 |
| Pay vs Performance Disclosure |
|
|
|
|
| Pay vs Performance Disclosure, Table |
| | | | | | | | | | | | Summary Compensation
Total | Compensation Actually
Paid (3) | Average
Summary | Average
Compensation | Value of Fixed $100
Investment based on: | GAAP | | Fiscal
Year
(1) | John C.
Corbett
($) (2) | Robert R.
Hill, Jr.
($) (2) | John C.
Corbett
($) (4) | Robert R.
Hill, Jr.
($) (4) | Compensation
Total for Non-
PEO NEOs
($) (5) | Actually
Paid for Non-
PEO NEOs
($) (6) | Company
TSR
($) (7) | Peer Group
TSR
($) (8) | Net
Income
(Loss)
($M) (9) | Adjusted
PPNR ($) (10) | 2023 | 5,166,659 | — | 6,000,069 | — | 2,784,360 | 2,855,622 | 108 | 116 | 494 | 784 | 2022 | 5,374,483 | — | 6,398,334 | — | 2,490,730 | 2,832,485 | 95 | 106 | 496 | 746 | 2021 | 5,311,551 | — | 6,003,122 | — | 3,067,288 | 3,411,157 | 97 | 117 | 476 | 518 | 2020 | 1,632,376 | 12,889,221 | 6,265,904 | 12,690,699 | 2,345,769 | 2,397,420 | 86 | 88 | 121 | 465 |
(1) | The Pay Versus Performance table reflects required disclosures for fiscal years 2023, 2022, 2021 and 2020. |
(2) | For fiscal years 2023, 2022, and 2021, Mr. Corbett was the sole Principle Executive Officer (“PEO”) of the Company. For fiscal year 2020, both Messrs. Corbett and Hill served as PEO. Amounts reported in these columns represent (i) the total compensation reported in the Summary Compensation Table (“SCT”) for the applicable year in the case of our PEOs, Mr. Corbett and Mr. Hill (Former CEO), and (ii) the average of the total compensation reported in the SCT for the applicable year for our Non-PEO NEOs. |
(3) | The Compensation Actually Paid (“CAP”) for each year was calculated beginning with the applicable Summary Compensation Table (“SCT”) total as set forth on page 49, less the amounts reported in the SCT for stock-based awards (RSUs and PSUs), plus the fair value as of the end of the covered fiscal year of all awards granted during the fiscal year that are outstanding and unvested as of the fiscal year-end, plus the amount equal to the change in fair value as of the end of the covered fiscal year, whether positive or negative, of any awards granted in any prior fiscal year that are outstanding and unvested as of the end of the covered fiscal year; and adding the dollar value of any dividends or other earnings paid on awards in the covered fiscal year prior to the vesting date that are not otherwise included in another component of total compensation for such fiscal year, plus an amount equal to the change in fair value as of the vesting date, whether positive or negative, of any award granted in any prior fiscal year for which all applicable vesting conditions were satisfied at the end of or during the covered fiscal year. Relative to the PEO’s CAP, the following amounts were deducted from and added to SCT total compensation. Fair values were computed in accordance with ASC 718 as of the applicable valuation date and take into account any excess fair value as a result of the TBV Growth Adjustment. |
(4) | Amounts reported in these columns represent the CAP for the applicable year in the case of our PEOs, Mr. Corbett and Mr. Hill. Adjustments were made to the amounts reported in the SCT for the applicable year. A reconciliation of the adjustments made to the 2023 SCT amounts to calculate CAP for our PEO, Mr. Corbett, and for the average of the Non-PEO NEOs is set forth in the following tables. For purposes of the tables, “EOY” means End of Year, and “BOY” means Beginning of Year. |
PEO (Corbett) SCT Total to CAP Reconciliation | | | | | Year | SCT Total ($) | Deductions from SCT
(i) | Additions to SCT Total
(ii) | CAP ($) | 2023 | 5,166,659 | (2,746,330) | 3,579,740 | 6,000,069 |
| (i) | Represents the grant date fair value of equity-based awards granted each year as reported in the SCT. |
| (ii) | The additions to the SCT Total reflect the value of equity calculated in accordance with the SEC methodology for determining CAP for each year shown as follows: |
Supplemental PEO (Corbett) Equity Component of CAP | | | | | | | | Year | SCT Total for
PEO ($) | (Less) SCT Equity for PEO ($) | Plus (Less) Fair Value of Equity Awards
Granted During
Fiscal Year
Outstanding
and Unvested
at EOY ($)r | Plus (Less) Change
from BOY to EOY
in Fair Value of
Awards Granted
in any Prior
Fiscal Year that
are Outstanding
and Unvested at
EOY ($) | Plus (Less) Change in
Fair Value from
BOY to Vesting
Date of Awards
Granted in Any
Prior Fiscal Year
that Vested
During the Fiscal
Year
($) | Value of
Dividends or
Other Earnings
Paid on Stock or
Option Awards
not Otherwise
Reflected in Fair
Value or Total
Compensation ($) | PEO CAP
($) | 2023 | 5,166,659 | (2,746,330) | 3,045,267 | 646,626 | (317,962) | 205,809 | 6,000,069 |
(5) | Each of the three fiscal years presented includes the average SCT totals of the Non-PEO NEOs as applicable in each reporting year. Fiscal year 2023 includes Messrs. Hill, Matthews, Murray and Young, and Ms. Brooks. Fiscal year 2022 includes Messrs. Hill, Matthews, Williams, and Young. Fiscal |
year 2021 includes Messrs. Hill, Matthews and Young, and Ms. Brooks. Fiscal year 2020 includes Messrs. Matthews, Goettee, Lapointe, and Pollok, and Ms. Brooks. (6) | Relative to CAP, the following amounts were deducted from and added to SCT total compensation: |
Average Non-PEO NEO SCT Total to CAP Reconciliation Year | SCT Total
($) | Deductions from SCT
(i) | Additions to SCT Total
(ii) | CAP
($) | 2023 | 2,784,360 | (603,918) | 675,180 | 2,855,622 |
| (i) | Represents the average of the non-PEO NEOs’ grant date fair value of equity-based awards granted each year as reported in the SCT. |
| (ii) | The additions to the SCT Total reflect the average of the non-PEO NEOs value of equity calculated in accordance with the SEC methodology for determining CAP for each year shown as follows: |
Supplemental Non-PEO Average Equity Component of CAP for Fiscal Year 2023 Year | SCT Total for
Non-PEO NEO
($) | (Less) SCT
Equity for Non-
PEO NEO
($) | Plus (Less) EOY Fair Value of Equity
Awards Granted
During Fiscal
Year Outstanding
and Unvested
at EOY
($) | Plus (Less) Change from BOY to EOY in Fair
Value of Awards
Granted in any Prior
Fiscal Year that are
Outstanding and
Unvested at EOY
($) | Plus (Less) Change in Fair
Value from BOY to
Vesting Date of
Awards Granted in
Any Prior Fiscal
Year that Vested
During the
Fiscal Year
($) | Value of Dividends
or Other Earnings
Paid on Stock or
Option Awards not
Otherwise Reflected
in Fair Value or
Total Compensation
($) | Non-PEO NEO
CAP
($) | 2023 | 2,784,360 | (603,918) | 669,655 | 120,046 | (152,730) | 38,210 | 2,855,622 |
(7) | This amount represents the cumulative TSR based on an initial fixed $100 investment in SouthState common stock for the measurement periods beginning on December 31, 2019, and ending on December 31 of each of 2023, 2022, 2021, and 2020, respectively, assuming in each case reinvestment of all dividends, calculated in accordance with Item 201(e) of the Regulation S-K. TSR is calculated by dividing the difference between the price of the Company’s common stock at the end and the beginning of the measurement period by the price of the Company’s common stock at the beginning of the measurement period. |
(8) | The peer group for purposes of this table is the KBW Nasdaq Regional Banking Index (“KRX”), which is the same peer group disclosed in the Company’s Annual Report on Form 10-K. |
(9) | This amount represents the Company’s GAAP Net Income (Loss) Attributable to SouthState (in millions) as disclosed in SouthState’s Annual Reports on Form 10-K for each applicable fiscal year-end 2023, 2022, 2021, and 2020. |
(10) | Adjusted PPNR has been selected as the Company Selected Measure because the Company believes it is the most important measure linked to compensation actually paid, has a close association with the Company’s share price and TSR, and has been and is expected to continue to be a performance metric that is important to the Company and our stockholders. Adjusted PPNR is a non-GAAP financial measure that equals net income before income tax and provision for credit losses (including unfunded commitments) and excludes the impact of branch consolidation, gains or losses on AFS securities, and other one-time adjustments such as extinguishment of debt cost, income tax benefit/cost related to the carryback of tax losses under the CARES Act, and adjustments (positive or negative) resulting from federal and state tax examinations for tax years outside of the measurement period. See reconciliation of GAAP to Non-GAAP measures in Appendix A. |
|
|
|
|
| Company Selected Measure Name |
Adjusted PPNR
|
|
|
|
| Named Executive Officers, Footnote |
(2) | For fiscal years 2023, 2022, and 2021, Mr. Corbett was the sole Principle Executive Officer (“PEO”) of the Company. For fiscal year 2020, both Messrs. Corbett and Hill served as PEO. Amounts reported in these columns represent (i) the total compensation reported in the Summary Compensation Table (“SCT”) for the applicable year in the case of our PEOs, Mr. Corbett and Mr. Hill (Former CEO), and (ii) the average of the total compensation reported in the SCT for the applicable year for our Non-PEO NEOs. |
(5) | Each of the three fiscal years presented includes the average SCT totals of the Non-PEO NEOs as applicable in each reporting year. Fiscal year 2023 includes Messrs. Hill, Matthews, Murray and Young, and Ms. Brooks. Fiscal year 2022 includes Messrs. Hill, Matthews, Williams, and Young. Fiscal |
year 2021 includes Messrs. Hill, Matthews and Young, and Ms. Brooks. Fiscal year 2020 includes Messrs. Matthews, Goettee, Lapointe, and Pollok, and Ms. Brooks.
|
|
|
|
| Peer Group Issuers, Footnote |
(8) | The peer group for purposes of this table is the KBW Nasdaq Regional Banking Index (“KRX”), which is the same peer group disclosed in the Company’s Annual Report on Form 10-K. |
|
|
|
|
| Adjustment To PEO Compensation, Footnote |
(4) | Amounts reported in these columns represent the CAP for the applicable year in the case of our PEOs, Mr. Corbett and Mr. Hill. Adjustments were made to the amounts reported in the SCT for the applicable year. A reconciliation of the adjustments made to the 2023 SCT amounts to calculate CAP for our PEO, Mr. Corbett, and for the average of the Non-PEO NEOs is set forth in the following tables. For purposes of the tables, “EOY” means End of Year, and “BOY” means Beginning of Year. |
PEO (Corbett) SCT Total to CAP Reconciliation | | | | | Year | SCT Total ($) | Deductions from SCT
(i) | Additions to SCT Total
(ii) | CAP ($) | 2023 | 5,166,659 | (2,746,330) | 3,579,740 | 6,000,069 |
| (i) | Represents the grant date fair value of equity-based awards granted each year as reported in the SCT. |
| (ii) | The additions to the SCT Total reflect the value of equity calculated in accordance with the SEC methodology for determining CAP for each year shown as follows: |
Supplemental PEO (Corbett) Equity Component of CAP | | | | | | | | Year | SCT Total for
PEO ($) | (Less) SCT Equity for PEO ($) | Plus (Less) Fair Value of Equity Awards
Granted During
Fiscal Year
Outstanding
and Unvested
at EOY ($)r | Plus (Less) Change
from BOY to EOY
in Fair Value of
Awards Granted
in any Prior
Fiscal Year that
are Outstanding
and Unvested at
EOY ($) | Plus (Less) Change in
Fair Value from
BOY to Vesting
Date of Awards
Granted in Any
Prior Fiscal Year
that Vested
During the Fiscal
Year
($) | Value of
Dividends or
Other Earnings
Paid on Stock or
Option Awards
not Otherwise
Reflected in Fair
Value or Total
Compensation ($) | PEO CAP
($) | 2023 | 5,166,659 | (2,746,330) | 3,045,267 | 646,626 | (317,962) | 205,809 | 6,000,069 |
|
|
|
|
| Non-PEO NEO Average Total Compensation Amount |
$ 2,784,360
|
$ 2,490,730
|
$ 3,067,288
|
$ 2,345,769
|
| Non-PEO NEO Average Compensation Actually Paid Amount |
$ 2,855,622
|
2,832,485
|
3,411,157
|
2,397,420
|
| Adjustment to Non-PEO NEO Compensation Footnote |
(6) | Relative to CAP, the following amounts were deducted from and added to SCT total compensation: |
Average Non-PEO NEO SCT Total to CAP Reconciliation Year | SCT Total
($) | Deductions from SCT
(i) | Additions to SCT Total
(ii) | CAP
($) | 2023 | 2,784,360 | (603,918) | 675,180 | 2,855,622 |
| (i) | Represents the average of the non-PEO NEOs’ grant date fair value of equity-based awards granted each year as reported in the SCT. |
| (ii) | The additions to the SCT Total reflect the average of the non-PEO NEOs value of equity calculated in accordance with the SEC methodology for determining CAP for each year shown as follows: |
Supplemental Non-PEO Average Equity Component of CAP for Fiscal Year 2023 Year | SCT Total for
Non-PEO NEO
($) | (Less) SCT
Equity for Non-
PEO NEO
($) | Plus (Less) EOY Fair Value of Equity
Awards Granted
During Fiscal
Year Outstanding
and Unvested
at EOY
($) | Plus (Less) Change from BOY to EOY in Fair
Value of Awards
Granted in any Prior
Fiscal Year that are
Outstanding and
Unvested at EOY
($) | Plus (Less) Change in Fair
Value from BOY to
Vesting Date of
Awards Granted in
Any Prior Fiscal
Year that Vested
During the
Fiscal Year
($) | Value of Dividends
or Other Earnings
Paid on Stock or
Option Awards not
Otherwise Reflected
in Fair Value or
Total Compensation
($) | Non-PEO NEO
CAP
($) | 2023 | 2,784,360 | (603,918) | 669,655 | 120,046 | (152,730) | 38,210 | 2,855,622 |
|
|
|
|
| Compensation Actually Paid vs. Total Shareholder Return |
|
|
|
|
| Compensation Actually Paid vs. Net Income |
|
|
|
|
| Compensation Actually Paid vs. Company Selected Measure |
|
|
|
|
| Total Shareholder Return Vs Peer Group |
|
|
|
|
| Tabular List, Table |
The following table sets forth an unranked list of the performance measures which we view as the “most important” measures for linking our NEOs’ compensation to performance: | Most Important Performance Measures (unranked) | Adjusted PPNR | Tangible Book Value/Share | Return on Average Tangible Common Equity | SouthState's Share Price |
|
|
|
|
| Total Shareholder Return Amount |
$ 108
|
95
|
97
|
86
|
| Peer Group Total Shareholder Return Amount |
116
|
106
|
117
|
88
|
| Net Income (Loss) |
$ 494,000,000
|
$ 496,000,000
|
$ 476,000,000
|
$ 121,000,000
|
| Company Selected Measure Amount |
784,000,000
|
746,000,000
|
518,000,000
|
465,000,000
|
| PEO Name |
Mr. Corbett
|
|
|
|
| Measure:: 1 |
|
|
|
|
| Pay vs Performance Disclosure |
|
|
|
|
| Name |
Adjusted PPNR
|
|
|
|
| Non-GAAP Measure Description |
(10) | Adjusted PPNR has been selected as the Company Selected Measure because the Company believes it is the most important measure linked to compensation actually paid, has a close association with the Company’s share price and TSR, and has been and is expected to continue to be a performance metric that is important to the Company and our stockholders. Adjusted PPNR is a non-GAAP financial measure that equals net income before income tax and provision for credit losses (including unfunded commitments) and excludes the impact of branch consolidation, gains or losses on AFS securities, and other one-time adjustments such as extinguishment of debt cost, income tax benefit/cost related to the carryback of tax losses under the CARES Act, and adjustments (positive or negative) resulting from federal and state tax examinations for tax years outside of the measurement period. See reconciliation of GAAP to Non-GAAP measures in Appendix A. |
|
|
|
|
| Measure:: 2 |
|
|
|
|
| Pay vs Performance Disclosure |
|
|
|
|
| Name |
Tangible Book Value/Share
|
|
|
|
| Measure:: 3 |
|
|
|
|
| Pay vs Performance Disclosure |
|
|
|
|
| Name |
Return on Average Tangible Common Equity
|
|
|
|
| Measure:: 4 |
|
|
|
|
| Pay vs Performance Disclosure |
|
|
|
|
| Name |
SouthState's Share Price
|
|
|
|
| John C. Corbett |
|
|
|
|
| Pay vs Performance Disclosure |
|
|
|
|
| PEO Total Compensation Amount |
$ 5,166,659
|
$ 5,374,483
|
$ 5,311,551
|
$ 1,632,376
|
| PEO Actually Paid Compensation Amount |
6,000,069
|
$ 6,398,334
|
$ 6,003,122
|
6,265,904
|
| Robert R. Hill, Jr. |
|
|
|
|
| Pay vs Performance Disclosure |
|
|
|
|
| PEO Total Compensation Amount |
|
|
|
12,889,221
|
| PEO Actually Paid Compensation Amount |
|
|
|
$ 12,690,699
|
| PEO | John C. Corbett | Deductions from SCT |
|
|
|
|
| Pay vs Performance Disclosure |
|
|
|
|
| Adjustment to Compensation, Amount |
(2,746,330)
|
|
|
|
| PEO | John C. Corbett | Additions to SCT Total |
|
|
|
|
| Pay vs Performance Disclosure |
|
|
|
|
| Adjustment to Compensation, Amount |
3,579,740
|
|
|
|
| PEO | John C. Corbett | Plus (Less) Fair Value of Equity Awards Granted During Fiscal Year Outstanding and Unvested at EOY |
|
|
|
|
| Pay vs Performance Disclosure |
|
|
|
|
| Adjustment to Compensation, Amount |
3,045,267
|
|
|
|
| PEO | John C. Corbett | Plus (Less) Change from BOY to EOY in Fair Value of Awards Granted in any Prior Fiscal Year that are Outstanding and Unvested at EOY |
|
|
|
|
| Pay vs Performance Disclosure |
|
|
|
|
| Adjustment to Compensation, Amount |
646,626
|
|
|
|
| PEO | John C. Corbett | Plus (Less) Change in Fair Value from BOY to Vesting Date of Awards Granted in Any Prior Fiscal Year that Vested During the Fiscal Year |
|
|
|
|
| Pay vs Performance Disclosure |
|
|
|
|
| Adjustment to Compensation, Amount |
(317,962)
|
|
|
|
| PEO | John C. Corbett | Value of Dividends or Other Earnings Paid on Stock or Option Awards not Otherwise Reflected in Fair Value or Total Compensation |
|
|
|
|
| Pay vs Performance Disclosure |
|
|
|
|
| Adjustment to Compensation, Amount |
205,809
|
|
|
|
| Non-PEO NEO | Deductions from SCT |
|
|
|
|
| Pay vs Performance Disclosure |
|
|
|
|
| Adjustment to Compensation, Amount |
(603,918)
|
|
|
|
| Non-PEO NEO | Additions to SCT Total |
|
|
|
|
| Pay vs Performance Disclosure |
|
|
|
|
| Adjustment to Compensation, Amount |
675,180
|
|
|
|
| Non-PEO NEO | Plus (Less) Fair Value of Equity Awards Granted During Fiscal Year Outstanding and Unvested at EOY |
|
|
|
|
| Pay vs Performance Disclosure |
|
|
|
|
| Adjustment to Compensation, Amount |
669,655
|
|
|
|
| Non-PEO NEO | Plus (Less) Change from BOY to EOY in Fair Value of Awards Granted in any Prior Fiscal Year that are Outstanding and Unvested at EOY |
|
|
|
|
| Pay vs Performance Disclosure |
|
|
|
|
| Adjustment to Compensation, Amount |
120,046
|
|
|
|
| Non-PEO NEO | Plus (Less) Change in Fair Value from BOY to Vesting Date of Awards Granted in Any Prior Fiscal Year that Vested During the Fiscal Year |
|
|
|
|
| Pay vs Performance Disclosure |
|
|
|
|
| Adjustment to Compensation, Amount |
(152,730)
|
|
|
|
| Non-PEO NEO | Value of Dividends or Other Earnings Paid on Stock or Option Awards not Otherwise Reflected in Fair Value or Total Compensation |
|
|
|
|
| Pay vs Performance Disclosure |
|
|
|
|
| Adjustment to Compensation, Amount |
$ 38,210
|
|
|
|