DEF 14A of SouthState Bank Corp
Filed Mar 8, 2024 · FY20230001558370-24-002793
Key statistics about our director nominees
Key statistics about our director nominees
Key statistics about our director nominees
| 3.9 years average tenure, below the 7.8-year S&P 500 average(1) | 10 of 11 or 91% are independent | 2 of 11 or 18% are women | 2 of 11 or 18% are ethnically diverse | 6 of 11 or 55% have CEO-level experience | 4 of 11 or 36% have senior executive experience at financial institutions |
Key statistics about our director nominees
| (1) Our director nominees’ average tenure is calculated by full years of completed service based on date of initial election as of our annual meeting date; source for S&P 500 average: 2023 Spencer Stuart Board Index. |
Key statistics about our director nominees
Our key corporate governance policies include:
Key statistics about our director nominees
| An annually elected Board, with directors serving one-year terms | | A majority independent Board, with entirely independent Audit, Compensation, Governance and Nominating, and Risk Committees | | Separate roles of CEO and Independent Board Chair with clearly defined responsibilities (1) | | Executive sessions of independent directors at regularly scheduled Board and Board Committee meetings | | Board review and oversight of current and potential risks facing the Company and its business | | Annual Board self-assessment coordinated by the Independent Board Chair and the Governance and Nominating Committee and annual Board committee performance evaluations coordinated by each committee | | At least six (6) hours of required director education annually | | Stock ownership requirements for directors and executive officers and insider trading guidelines | | Insider Trading Policy compliant with SEC and NYSE Rules on trading and prohibitions on directors, officer and employees from engaging in hedging or pledging transactions, publicly available under the “Investor Relations” tab at the Bank’s website, www.southstatebank.com | | Compensation Recoupment Policies, one compliant with SEC and NYSE Rules on recouping certain executive compensation paid to executive officers in the event of certain accounting restatements and one covering employees and triggering events beyond those required by SEC and NYSE rules | | No poison pill | | Shareholders owning 10% or more of the Company’s common stock can call a special meeting of shareholders | | Mandatory director retirement age of 72 years | | Code of Ethics applicable to all directors, officers and employees | | Whistleblower Hotline available on our public facing website as a confidential mechanism to report concerns regarding accounting, internal controls, auditing matters, securities law compliance, or any provision of federal law relating to fraud against shareholders, publicly available under the “Investor Relations” tab at the Bank’s website, www.southstatebank.com |
Key statistics about our director nominees
| (1) Effective as of April 26. 2023, the Executive Chairman role was eliminated as an officer of the Company as part of a broader, ongoing effort to enhance the independence of the Board. On the same date, the Company appointed Douglas J. Hertz as a new independent Chair of the Board. |
Key statistics about our director nominees
2024 PROXY STATEMENT v
Our Directors
Our Directors Our directors represent a diverse range of qualifications and skills:
Our Directors
| ✓ | Strategic Vision. They are seasoned leaders who have held an array of diverse leadership positions and have practical insight into the skills needed to advance the Company’s corporate strategy. |
Our Directors
| ✓ | Leadership. They have served as chief executives and in senior positions in the areas of risk, operations, finance, technology, and human resources. |
Our Directors
| ✓ | Risk Management. Through their experience in complex regulatory, technology, operational, and risk environments (including banks and other financial services organizations), they understand the skillful oversight needed to identify, evaluate and prioritize risk. |
Our Directors
| ✓ | Human Capital Management. With directors experienced in leading corporate culture and Human Resources initiatives and departments, they understand the need for ongoing, consistent talent development and the Company’s commitment to making SouthState a great place to work. |
Our Directors
| ✓ | Cybersecurity. A cybersecurity expert chairs our Risk Committee and provides technology-related insight and guidance to the Company. |
Our Directors
| ✓ | Customer Experience. They are customer-centric, with expertise in enhancing and transforming customer service experiences. |
Our Directors
| ✓ | Diverse Attributes. They represent diverse backgrounds, in terms of gender, race, ethnicity, and experience, thereby contributing to diverse viewpoints. |
Our Directors
| ✓ | Perspectives. They strengthen our Board’s oversight capabilities by having varied lengths of tenure that provide historical and new perspectives about our Company. |
Our Directors
| | Our Board recommends a vote “for” each of the 11 nominees listed below for election as a director (Proposal 1). |
Our Directors
Set forth below are each nominee’s name, age as of our annual meeting date, principal occupation, business experience, and U.S.-listed public company directorships held during the past five years. We also discuss the qualifications, attributes, and skills that led our Board to nominate each for election as a SouthState director.
Our Directors
| Ronald M. Cofield, Sr. | Age: 65 | Director since: 2022 | | | Retired, Audit Partner, Pricewaterhouse-Coopers L.L.P. | Mr. Cofield is a retired audit partner from PricewaterhouseCoopers L.L.P. (“PwC”). During his 38-year career with PwC, he served as managing partner of its Orlando and Birmingham offices, Carolinas practice (Charlotte, Raleigh, Greensboro, and Spartanburg offices) and Atlanta Assurance practice (Atlanta, Nashville, and Birmingham offices), all key markets of the Bank. Mr. Cofield served as audit partner for multiple public companies, including other financial institutions. Mr. Cofield has served as Director or Executive Committee Member to numerous charitable and civic organizations in Orlando, Birmingham, Charlotte, and Atlanta, including the Atlanta Symphony Orchestra, Charlotte Arts and Science Council, and Operation New Birmingham. He currently works with the Tech Transformation Academy at City of Refuge, a not-for-profit organization located in one of Atlanta’s most economically challenged neighborhoods, where his responsibilities include professional life skills training, corporate outreach and placement. He is a Certified Public Accountant and a member of the American Institute of Certified Public Accountants. Mr. Cofield’s accounting knowledge, experience serving as audit partner for large financial institutions, and leadership experience in certain of our markets provides our Board with useful accounting-related insight. |
Our Directors
| Shantella E. Cooper | Age: 56 | Director since: 2022 | | | Former Executive Director, Atlanta Committee for Progress | Ms. Cooper is the founder and Chief Executive Officer of Journey Forward Strategies, LLC, consulting with Fortune 500 companies and not-for-profit organizations in the areas of executive coaching, leadership and culture development, and business transformation. Ms. Cooper served as the former Executive Director for the Atlanta Committee for Progress, a coalition of leading CEOs focused on critical development and inclusion for the city of Atlanta (October 2018 to February 2022). Prior to joining Atlanta Committee for Progress, Ms. Cooper served as Chief Transformation Officer for WestRock Company, a corrugated package company (2016 to 2018), and Vice President and General Manager of Lockheed Martin Aeronautics Company (2011 to 2016). During her time at Lockheed Martin, Ms. Cooper also served as Vice President of Human Resources and Vice President of Ethics for the Aeronautics Division. Ms. Cooper is active in her community, serving on various for-profit and not-for-profit boards, including Emory University where she serves as Vice Chair, Georgia Tech Research Institute, Grady Healthcare System, and Georgia Historical Society. Ms. Cooper’s in-depth knowledge of business operations and strategy, together with her leadership in economic growth, risk management, change management, and community affairs, will enhance the Board’s ability to position the Company for future growth and success. Other U.S.-Listed Company Boards: Atlantic Capital (2019 to 2022); Intercontinental Exchange, Inc. (2020 to present); Verativ Corporation (2020 to 2023). Southern Company (2023 to present). |
Our Directors
| John C. Corbett | Age: 55 | Director since: 2020 | | | Chief Executive Officer, SouthState; Chief Executive Officer and President of the Bank | Mr. Corbett was appointed as the Chief Executive Officer of the Company, the President and Chief Executive Officer of the Bank, and to our Board of Directors on June 7, 2020, in connection with the merger (the “CenterState Merger”) of the Company and CenterState Bank Corporation (“CenterState”). Before that, he served as the President and Chief Executive Officer of CenterState since July 2015 and was its Executive Vice President from 2007 to 2015. He also served as the Chief Executive Officer and as a director of CenterState Bank, N.A. (“CenterState Bank” and now known as the Bank) (2003 to June 2020) and was CenterState Bank’s Executive Vice President and Chief Credit Officer from 2000 to 2003. Prior to joining CenterState Bank in 1999, he was Vice President of Commercial Banking at First Union National Bank in Florida (1990 to 1999). Mr. Corbett is the brother-in-law of Mr. Young, our Chief Strategy Officer. Mr. Corbett, as a founding leader of CenterState, brings to our Board a strong historical perspective and working knowledge of CenterState, which we believe will contribute considerable value as part of our deliberations and decision-making process. Other U.S.-Listed Company Boards: CenterState (2011 to 2020). |
Our Directors
| Jean E. Davis | Age: 68 | Director since: 2017 | | | Retired, Head of Operations, Technology and e-Commerce, Wachovia Corporation | Ms. Davis retired as the head of Operations, Technology and e-Commerce of Wachovia Corporation in 2006. She previously served as the Head of Operations and Technology, Head of Human Resources, Head of Retail Banking, and in several other executive, regional executive and corporate banking roles for Wachovia. Ms. Davis brings to our Board extensive knowledge of bank operations and technology, as well as human resources, which are important to our long-term success. In addition, she brings a strong background in retail banking, merger due diligence and merger integration experience. Other U.S.-Listed Company Boards: Park Sterling Corporation (2011 to 2017). |
Our Directors
| Martin B. Davis | Age: 61 | Director since: 2016 | | | Executive Vice President, Southern Company Services, and Chief Information Officer, Southern Company | Mr. Davis has spent over 35 years leading complex technology organizations in highly regulated environments. Since 2015, Mr. Davis has served as Executive Vice President of Southern Company Services and Chief Information Officer of Southern Company where he leads a team of over 2,000 experts in information technology strategy development, operations, and delivery supporting nine subsidiaries across the Southeast. Prior to his current role, Mr. Davis held several technology-related roles with Wells Fargo and its predecessor organizations, including serving as the head of Enterprise Technology Services, Chief Technology Officer and Executive Vice President (2012-2014), where he provided executive leadership for key enterprise technology functions including information security. He has been recognized as one of the “50 Most Important African-Americans in Technology” by U.S. Black Engineers & Information Technology magazine and one of the “75 Most Powerful African-Americans in Corporate America” by Black Enterprise. Mr. Davis was also named one of the “Most Influential Blacks in Corporate America” by Savoy magazine in 2019 and 2020. Most recently, he was named the 2021 TechBridge Ed Steinike CIO of the Year. Mr. Davis serves on the Board of Directors of the American Heart Association’s Southeast Region (2015 to present) and Piedmont Healthcare (2020 to present), and he previously served on the Board of Trustees of Winston-Salem State University (2006 to 2013). Mr. Davis’s technology-related experience provides our Board with useful insight regarding this area of increasing strategic importance to bank marketing and operations. |
Our Directors
| Douglas J. Hertz | Age: 71 | Director since: 2022 | | | Chief Executive Officer and President, United Distributors, Inc. | Mr. Hertz began his professional career with KPMG, LLP in its accounting and consulting services area. He later joined United Distributors, Inc., a privately-held beverage distributor, and was named President and Chief Executive Officer in 1984. He currently sits on the Board of Directors for Georgia Power Company, Georgia Ports Authority, and a number of not-for-profit institutions, including Woodruff Arts Center. Mr. Hertz currently serves as the Chairman of Camp Twin Lakes, a camping facility designed for chronically ill and disadvantaged children, and he is the past chair of the Tulane University and Children’s Healthcare of Atlanta Boards of Trustees. Mr. Hertz’s oversight and risk management experience, in addition to his knowledge of financial reporting and accounting, qualify him to serve on the Board of the Company. Other US-Listed Company Boards: Atlantic Capital (2011 to 2022). |
Our Directors
| G. Ruffner Page, Jr. | Age: 65 | Director since: 2020 | | | President and Chief Operating Officer, O’Neal Industries | Mr. Page was appointed to our Board of Directors on June 7, 2020, in connection with the CenterState Merger. He is the President and Chief Operating Officer at O’Neal Industries. O’Neal Industries’ companies provide products and services across the metals industry, ranging from carbon and stainless steel, aluminum, and specialty alloy products to complex manufactured components and tubing. Mr. Page has served on the Board for O’Neal Industries since 2016. He retired in January 2022 from McWane, Inc. a global manufacturing business where he had served as President since 1999. He also previously served as Executive Vice President of National Bank of Commerce, a subsidiary of Alabama National Bancorporation, from 1989 until 1994, and served as a director for Alabama National BanCorporation from 1995 to 2008. Mr. Page’s experience as the President of one of the largest privately-owned metals service centers in the U.S. and understanding of banking as a former financial institution executive provides our Board with valuable strategic insights as we continue to evolve into a leading Southeast regional community bank. Other U.S.-Listed Company Boards: CenterState (2019 to 2020); National Commerce Corporation (“NCOM”) (Lead Independent Director) (2010-2019); and Alabama National Bancorporation (1995 to 2008). |
Our Directors
| William K. Pou, Jr. | Age: 67 | Director since: 2020 | | | Retired, Executive Vice President and Chairman, W.S. Badcock Corporation | Mr. Pou was appointed to our Board of Directors on June 7, 2020, in connection with the CenterState Merger. Until the 2021 sale of W.S. Badcock Corporation, Mr. Pou served as the Chairman of the Board, Executive Vice President and Chairman of the Compliance Committee of W.S. Badcock Corporation (dba Badcock Home Furniture & More), where he was responsible for the retail operations of over 373 stores in eight states throughout the Southeastern United States. From the 2021 sale through 2022, he served as an Executive Advisor to the company’s new management team. Mr. Pou spent his entire adult life with this organization and participated in all aspects of its operations including the consumer credit division as well as personally owning and operating several stores between 1979 and 1998 as an independent dealer. He was also a founding director of the First National Bank of Polk County in 1992, one of the initial three banks which were merged to form CenterState Bank. Mr. Pou brings to our Board more than 30 years of experience and insight in consumer credit and collections, as well as experience and knowledge in operating multi-unit, multi-state operations. Mr. Pou is active in the community, currently serving on the Boards of Trustee for Florida Southern College Board (Lakeland, Florida), Lakeland Regional Health, and Mercer University (Macon, Georgia). Other U.S.-Listed Company Boards: CenterState (2012 to 2020) |
Our Directors
| James W. Roquemore | Age: 69 | Director since: 2022 | | | Retired, Chief Executive Officer and Chairman, Patten Seed Company, Super Sod | Mr. Roquemore is the retired chief Executive Officer and Chairman of the Board of Directors of Patten Seed Company, Super Sod, where he served as Chief Executive Officer from 1995 until his retirement in September 2020. Currently, Mr. Roquemore serves as the President and Chairman of the Board of YC Holdings, Inc., a land holding and investment company that leases approximately 14,000 acres to Super Sod to produce turf grass and holds approximately 1,000 acres in developmental real estate. Active in his community, Mr. Roquemore currently serves as the Chairman of the Board of Directors of Orbis Health Solutions, a company dedicated to developing immunotherapy medicines to combat disease. Mr. Roquemore brings to the SouthState Board over 50 years of management, marketing, human resources, financial, operations and customer service experience. His business and personal experience in the communities in which SouthState is located provide him with an appreciation of markets that SouthState serves, and the relationships he has developed within those communities and as a result of serving on the Board of SouthState Corporation from 1994 to 2020 enhance his leadership and consensus-building ability. |
Our Directors
| David G. Salyers | Age: 65 | Director since: 2020 | | | Retired, Executive responsible for Growth and Hospitality, Chick-fil-A, Inc. | Mr. Salyers was appointed to our Board of Directors on June 7, 2020, in connection with the CenterState Merger. He is retired as the executive responsible for growth and hospitality for Chick-fil-A, Inc., the Atlanta based fast food restaurant chain, where he spent his entire 37-year career. From 2019 to 2020, Mr. Salyers served on the Board of Directors of Live Oak Banking Company. He also is active in community activities and has been involved in venture capital partnerships and technology ventures, as well as serves as a director for several start up organizations. Mr. Salyers serves as the Inaugural Start Up Mentor-In-Residence at the University of Georgia and is the author of the book, “Remarkable!” on company culture. Mr. Salyers’ experience in operating a national service-oriented business and leadership development is considered an asset to our Board as we continue to evolve into a leading Southeast regional community bank with a focus on our customer and employees and developing a distinctive and welcoming culture. Other U.S.-Listed Company Boards: CenterState (2017 to 2020) and Live Oak Bankshares Inc. (2019 to 2020). |
Our Directors
| Joshua A. Snively | Age: 59 | Director since: 2020 | | | President, ADM Global Citrus Platform; President, Florida Chemical Company, LLC | Mr. Snively was appointed to our Board of Directors on June 7, 2020, in connection with the CenterState Merger. He is President of ADM Global Citrus Platform and President of Florida Chemical Company, LLC. ADM acquired Florida Chemical from Flotek Industries, Inc. (Flotek) in March 2019. ADM (NYSE: ADM) is a global leader in human and animal nutrition and the world’s premier agricultural origination and processing company. Prior to the acquisition, Mr. Snively was Executive Vice President of Operations for Flotek and President of its wholly owned subsidiary, Florida Chemical Company, Inc. Mr. Snively has been with Florida Chemical since 1995 and was instrumental in transforming the company from a family-owned and operated business to a professionally managed operation with an independent Board of Directors. Prior to joining Florida Chemical, Mr. Snively was Vice President of Commercial Agriculture Finance at SunTrust Bank and was a commercial lender for Farm Credit of Central Florida. He graduated with a B.S. in Finance and Citrus Management from Florida Southern College. Mr. Snively’s commercial finance experience and his understanding of family-owned businesses as well as his experience with global sales and procurement strategies provide unique insight into global economic activity, risk management, and best-in-class business strategies. Other U.S.-Listed Company Boards: CenterState (2012 to 2020). |
Our Board of Directors
Our Board of Directors Our Board and its committees oversee:
Our Board of Directors
| ● | Management’s development and implementation of a three-year strategic business plan and annual budget and our progress meeting these plans |
Our Board of Directors
| ● | Management’s identification, measurement, monitoring, and control of our Company’s material risks, including operational (including payments, BSA/AML/OFAC, conduct, model, climate, and cyber risks), credit, market, price, liquidity, compliance, strategic, and reputational risks |
Our Board of Directors
| ● | 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 Board of Directors
| ● | Our Company’s maintenance of high ethical standards and effective policies and practices to protect our reputation, assets, and business |
Our Board of Directors
| ● | Our Company’s ESG objectives and initiatives |
Our Board of Directors
| ● | Our corporate audit function, our independent registered public accounting firm, and the integrity of our consolidated financial statements |
Our Board of Directors
| ● | Formal evaluation process of our Board and its committees which includes a peer-to-peer evaluation |
Our Board of Directors
| ● | 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 COMPENSATION
DIRECTOR COMPENSATION
2023 Director Pay
2023 Director Pay The table below sets forth the annual compensation of our non-employee directors for fiscal year 2023. In May 2023, the Compensation Committee reviewed and performed an analysis of director compensation paid to our peers, as discussed on pages 45 and 46, and determined to adjust our director compensation to bring it in line with director compensation paid by such peers.
2023 Director Pay
| Amount of Cash Retainer January 1 to April 30, 2023 | Amount of Cash Retainer May 1 to December 31, 2023 | Position | | $60,000 | $75,000 | Board Members | | $25,000 | $80,000 | Additional Fee to Chair of the Board (1) | | $15,000 | $15,000 | Chairs of the Risk, Governance and Nominating, and Compensation Committees | | $15,000 | $20,000 | Chair of Audit Committee | | $61,000 | (2) | Chair of the Culture Committee | | $10,000 | $15,000 | Committee Members of the Audit Committee | | $10,000 | $10,000 | Committee Members of the Risk, Governance and Nominating, and Compensation Committees |
2023 Director Pay
| Director Equity Retainer | | ● $85,000 issued May 1, 2023, in the form of RSUs that vest six months following the grant date. | | ● If Board service is terminated due to death, all unvested RSUs will fully vest as of the date of death. If Board service is terminated for any reason other than death, any unvested RSUs outstanding as of the date of termination would be forfeited. | | ● Upon a change of control, all unvested RSUs will become fully vested and settled in shares of SouthState common stock. |
2023 Director Pay
| (1) Paid to Mr. Hertz in his capacity as Lead Independent Director prior to April 26, 2023, and as independent Chair of the Board following April 26, 2023. |
2023 Director Pay
| (2) The Board Culture Committee was converted to a management-level committee, the Culture Council, as of April 26, 2023, at which point no directors continued serving as members of the committee, although Mr. Salyers continues to assist on an advisory basis as needed without any additional compensation. |
2023 Director Pay
For 2024, the Compensation Committee has retained the compensation structure and amount approved for 2023 Board service. Mr. Corbett, who is both an employee and a director, is not eligible to receive any equity, retainer, or fees for his service on the Board.
2023 Director Compensation Review
2023 Director Compensation Review The Compensation Committee is responsible for reviewing, on an annual basis, the compensation paid to our directors and making recommendations to the Board on any adjustments to it. Working with its independent compensation consultant, the Compensation Committee annually assesses SouthState’s director compensation program relative to our peers. In making this assessment, the Compensation Committee reviews (i) the individual pay components of our program relative to the pay components for directors at our peers, (ii) the average total compensation of our Board members relative to directors at our peers, and (iii) our aggregate Board compensation as compared to our peer group. As noted above, the Compensation Committee approved adjustments to director compensation in 2023 to bring director compensation levels in line with market practice among our peers.
2023 Director Compensation
2023 Director Compensation The following table shows the compensation paid to our 2023 non-management directors for their services in 2023:
2023 Director Compensation
| | 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 |
2023 Director Compensation
(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.
2023 Director Compensation
| proposal 2: approving our executive compensation |
a. Our Named Executive Officers
| ● | Robert R. Hill, Jr., age 56,separated from his employment as our Executive Chairman on April 26, 2023, after serving in such position since June 7, 2020, under circumstances resulting in a qualifying termination entitling him to severance under his employment agreement. See the section captioned “Potential Payments upon Termination or Change in Control” starting on page 56 for more information. Before that, he served as Chief Executive Officer of the Company from November 6, 2004, to June 7, 2020. Mr. Hill, who joined the Company in 1995, also served as President of the Company from November 6, 2004, to July 26, 2013, and the President and Chief Operating Officer of South State Bank from 1999 to November 6, 2004. In addition to serving as a director of the Company and the Bank from 1996 until 2023, a role in which he offered an intimate understanding of our business and organization, as well as substantial leadership ability, banking industry expertise, and management experience, Mr. Hill served on the Board of Directors of the Federal Reserve Bank in Richmond, Virginia from 2015 through 2020, where he chaired the Audit and Risk Committee and served on the IT Committee. Mr. Hill currently serves as on the Board of Directors of Sonoco Products Company (2019 to present). |
b. 2023 Highlights
| (1) Adjusted net income, PPNR, and ROATCE are Non-GAAP measures that exclude the impact of merger, branch consolidation and severance related expense, gains or losses on AFS securities and other one-time adjustments such as FDIC special assessment, net of tax, and income tax benefit/cost related to the carryback of tax losses under the CARES Act, and adjustments (positive or negative) resulting for federal and state tax examinations for tax years outside of the measurement period. In addition, PPNR excludes income taxes and provision for credit losses. ROATCE also excludes after-tax amortization of intangibles. See reconciliation of GAAP to Non-GAAP measures in Appendix A. |
a. Pay Evaluation and Decision Process
| ● | Performance as compared to competitor peer group |
i. Pay Practices
| ✓ Pay for Performance: We apply a framework based on soundness, profitability and growth goals to drive short-term and long-term shareholder value. ✓ Annual Say on Pay Vote: We conduct an annual Say on Pay vote in line with best governance practices. ✓ Stock Ownership Guidelines: We maintain strict stock ownership requirements for our Executive Leadership and Directors. ✓ Insider Trading Policy and Strong Pledging and Hedging Prohibitions: Executive Leadership and Directors are expected to comply with our SEC-compliant Insider Trading Policy, including with respect to Rule 10b5-1 trading plans, and prohibitions on pledging or hedging/speculative trading in shares of SouthState stock. ✓ Independent Compensation Consultant: The Compensation Committee engages an independent compensation consultant who reports directly to the Compensation Committee. ✓ Recoupment Policies: We maintain a compensation recoupment policy that requires us to recoup reasonably promptly incentive-based compensation received by executive officers in the event of certain restatements of our financial statements due to material noncompliance with any financial reporting requirement under federal securities laws, and which complements a broader clawback policy covering a broader scope of employees and other triggering events besides a restatement. ✓ Responsible Equity Grant Practices: We use the average of the closing price of our common stock for the preceding month to determine the number of PSU or RSU awards but recognize the expense of all share-based awards in our income statement over the award’s minimum required service period. ⌧ No New Excise Tax Gross-Ups: We do not provide gross-up payments for excise taxes other than under historic grandfathered arrangements. ⌧ No New Single Trigger Payments: Following the CenterState Merger, we no longer provide single trigger severance payments other than under historic grandfathered arrangements. ⌧ Severance: We provide only cash severance (in the form of base salary, cash bonuses and COBRA coverage) pursuant to the terms of the NEOs’ employment agreements. ⌧ No Repricing: We do not allow for repricing of stock options without our shareholders’ consent. |
ii. Impact of Compensation Practices on Risk Management
ii. Impact of Compensation Practices on Risk Management The Company’s incentive governance process includes a framework for developing new incentive compensation policies and procedures and a robust, multi-layered risk review process designed to comply with applicable law. The Compensation Committee has ultimate authority regarding all incentive plans. The Compensation Committee reviews and approves any material changes to incentive plans. An Incentive Compensation Committee at the management-level is responsible for reviewing the annual risk review process for incentive plans and monitors business line compliance with the approved incentive plans. The Compensation Committee reviews and approves the annual incentive plan risk assessments. For additional information, please see the discussion captioned “Compensation Governance and Risk Management – Compensation Risk Management Policies and Practices” beginning on page 24. We believe that our layered compensation governance approach, which includes offering a mix of fixed and variable compensation, performing annual incentive plan risk assessments, setting appropriate performance metrics that reward performance without encouraging excessive risk, and monitoring incentive plan awards, allows us to effectively mitigate excessive risk. The Chief Risk Officer presented the 2023 and 2024 incentive plans and risk review analyses for 2023 and 2024 plans, respectively, to the Compensation Committee, and based on its deliberations, the Compensation Committee concluded that our compensation and incentive plans and practices for 2023 and 2024 do not create risks that are likely to have a material adverse effect or would cause plan participants to take unnecessary risks.
c. Role of Compensation Consultant
c. Role of Compensation Consultant The Compensation Committee engages an independent compensation consultant to provide market reference perspective and serve as an advisor. The independent compensation consultant serves at the request of, and reports directly to, the Compensation Committee. Further, the Compensation Committee has the sole authority to engage a compensation consultant and approve the independent compensation consultant’s fees and other terms of the engagement. For 2023, the Compensation Committee engaged the services of FW Cook as its independent consultant. FW Cook performed a review of our director and executive compensation programs, provided peer group analyses, advised on regulatory developments, corporate governance and best practice trends, and participated in the Compensation Committee meetings held during 2023. The Compensation Committee considered the independence of FW Cook in light of applicable SEC rules and the Nasdaq Listing Standards. The Compensation Committee requested and received a report from FW Cook addressing the independence of FW Cook and its senior advisors. The following factors were considered: (1) services other than compensation consulting provided to us by FW Cook; (2) fees paid by us as a percentage of FW Cook’s total revenue; (3) policies or procedures maintained by FW Cook that are designed to prevent a conflict of interest; (4) any business or personal relationships between the senior advisors of FW Cook and a member of our Compensation Committee; (5) any stock of the Company owned by the senior advisors of FW Cook; and (6) any business or personal relationships between our executive officers and the senior advisors of FW Cook. The Compensation Committee discussed these considerations and concluded that the work performed by FW Cook, and FW Cook’s senior advisors involved in the engagements did not raise any conflict of interest. During 2023, FW Cook provided the following services to the SouthState Compensation Committee:
c. Role of Compensation Consultant
| ● | provided data and analysis to the Compensation Committee regarding compensation related trends in the banking industry; |
c. Role of Compensation Consultant
| ● | reviewed the Company’s total compensation philosophy for reasonableness and appropriateness; |
c. Role of Compensation Consultant
| ● | reviewed overall compensation levels; |
c. Role of Compensation Consultant
| ● | advised the Compensation Committee generally on the Executive Chairman’s employment agreement and compensation, including Mr. Hill’s separation from the Company in April 2023; |
c. Role of Compensation Consultant
| ● | reviewed the competitiveness of the compensation elements currently offered by the Company to its top executives, including base salary, annual incentive or bonus, long-term incentives (stock options, restricted stock, RSUs and PSUs), all other compensation, and changes in retirement benefits as compared to that of the customized peer group; |
c. Role of Compensation Consultant
| ● | advised the Compensation Committee regarding the compensation of outside directors, including the competitiveness of its elements as compared to the defined peer group; |
c. Role of Compensation Consultant
| ● | recommended and made observations regarding the potential alignment of the Company’s executive compensation practices with the Company’s overall business strategy and culture relative to the market as defined by the peer group (including a review of the current performance-based programs with respect to the annual cash incentives and annual equity grants); |
c. Role of Compensation Consultant
| ● | interacted with management to obtain compensation and benefits data, as well as other relevant information that is not available from public sources, to understand the scope of the various executive jobs to provide accurate benchmarking and confirm accurate and up-to-date factual and data analyses; |
c. Role of Compensation Consultant
| ● | provided market and peer data and recommendations on executive management compensation; and |
c. Role of Compensation Consultant
| ● | reviewed and provided input on an amendment and restatement of the 2020 Omnibus Incentive Plan in connection with Proposal 3 beginning on page 65. |
c. Role of Compensation Consultant
In addition, the Company engaged McLagan, an AON Company, to assist the Company with calculating the potential payments to our NEOs upon termination or change in control as disclosed in the 2023 Proxy Statement and continued that limited engagement for purposes of assisting the Company with the calculations disclosed in this Proxy Statement on page 56 below. In addition, we participated in McLagan’s annual survey of regional and community banks’ incentive compensation practices for specific lines of business, including commercial and specialty lending divisions, and executive management received a report of such results for banks with assets between $20 and $100 billion in assets. Fees Paid to Compensation Consultants. The aggregate fees paid by the Company to FW Cook in 2023 for determining or recommending the amount or form of executive and director compensation totaled $203,243.
a. Executive Pay Components and Variable Pay Mix
| (1) As previously disclosed, in accordance with his employment agreement, Mr. Hill received 100% of his LTI in the form of time-vesting RSUs, while all other NEOs receive both PSUs and RSUs as indicated. |
c. Annual Cash Incentive and Long-Term Incentive Plans
c. Annual Cash Incentive and Long-Term Incentive Plans The table below summarizes the components of each of the Annual Cash Incentive Plan (“AIP”) and Long-Term Incentive (“LTI”) Plan approved by the Compensation Committee for 2023, including the performance metrics that are being applied, and purpose for including such components. The Compensation Committee annually sets the amount of each executive’s threshold, target, and maximum award that can be awarded under the AIP, determined as a percentage of the participant’s base salary. In addition, the Compensation Committee approves the form of LTI awards and the related performance conditions for each executive (other than Mr. Hill) under the LTI plan in a manner designed to align the interests of our executives with those of our shareholders. Each January, the Compensation Committee reviews the Company’s performance for the prior fiscal year, aligns such performance with the opportunities and metrics under the AIP and LTI plan, and calculates and approves the awards to be granted. Following Board approval of such awards, the awards are granted to the NEOs in late January. The Compensation Committee establishes rigorous performance goals that are designed to achieve strong results without encouraging excessive risk-taking. For 2023, the metrics for receiving AIP and LTI awards were as set forth below:
c. Annual Cash Incentive and Long-Term Incentive Plans
| (1) Adjusted PPNR and ROATCE are non-GAAP financial measures that exclude the impact of merger, branch consolidation, and severance-related expense, gains or losses on AFS securities and other one-time adjustments such as FDIC special assessment, income tax benefit/cost related to the carryback of tax losses under the CARES Act, and adjustments (positive or negative) resulting for federal and state tax examinations for tax years outside of the measurement period. Adjusted ROATCE also excludes after-tax amortization of intangibles. See reconciliation of GAAP to Non-GAAP measures in Appendix A. |
c. Annual Cash Incentive and Long-Term Incentive Plans
| (2) Adjusted PPNR less Net Charge Offs equals net income before income taxes and provision for credit losses and excludes items as noted in note (1) above, less loan charge-offs, net of recoveries, recorded during the measurement period. |
c. Annual Cash Incentive and Long-Term Incentive Plans
| (3) Non-performing assets divided by the sum of loans plus other real estate owned on an absolute basis and as compared to our peers. A ratio less than or equal to 0.75% is maximum performance. A ratio above 0.75% results in a peer group comparison. |
c. Annual Cash Incentive and Long-Term Incentive Plans
| (4) TBV Growth is the compounded tangible book value growth per share plus cumulative dividends per share over the measurement period but excluding: (a) the impact of share repurchase activity on the Tangible Book Value per share; and (b) the impact of the change in accumulated other comprehensive income during the measurement period as described below. |
c. Annual Cash Incentive and Long-Term Incentive Plans
Each year, the Compensation Committee assesses the appropriateness of the prospective metrics for AIP and LTI awards. For the 2023 AIP, the Compensation Committee approved prospective performance metrics for the NEOs which included (1) removing the Adjusted Earnings Per Share (“EPS”) metric and (2) adjusting the calculation for the Adjusted PPNR metric to exclude Net Charge-offs in order to provide a more appropriate measure of net income outside of fluctuations in the CECL reserve. Further, the weight of Adjusted PPNR metric was increased such that it accounts for 80% of the AIP calculation, as opposed to 40% in 2022,due to the elimination of the EPS metric (with the NPA/Loans + OREO metric remaining at 20%). For LTI determinations for 2023, the Compensation Committee approved an LTI award mix of 60% PSUs and 40% RSUs of the overall LTI opportunity.
c. Annual Cash Incentive and Long-Term Incentive Plans
| ISCUSSION AND | | | | Compensation DISCUSSION AND ANALYSIS |
c. Annual Cash Incentive and Long-Term Incentive Plans
The 2023 AIP and LTI target opportunities as a percentage of base salary for each of the NEOs are outlined in the table below.
c. Annual Cash Incentive and Long-Term Incentive Plans
| Name | AIP Opportunity (Cash) (1) | LTI Opportunity 60% PSUs 40% RSUs (2) | | John C. Corbett, Chief Executive Officer | 115% | 280% | | William E. Matthews V, Chief Financial Officer | 70% | 125% | | Richard Murray IV, President of the Company | 70% | 100% | | Renee R. Brooks, Chief Operating Officer | 70% | 100% | | Stephen D. Young, Chief Strategy Officer | 100% | 150% | | Robert R. Hill, Jr., Executive Chairman (3) | 115% | 280% |
c. Annual Cash Incentive and Long-Term Incentive Plans
| (1) Maximum payout available under the AIP is 150% of the target AIP opportunity. |
c. Annual Cash Incentive and Long-Term Incentive Plans
| (2) 40% in the form of time-vesting RSUs that vest ratably over a three-year vesting period on January 1 of each year following the year of grant and 60% in the form of PSUs that are eligible to vest and become earned between 0% and 150% of target levels based on the achievement of a TBV Growth performance metric and a 3-Year ROATCE performance metric, equally weighted, over a three-year performance period, subject to the NEO’s continued employment with us through the vesting date. |
c. Annual Cash Incentive and Long-Term Incentive Plans
| (3) LTI award granted 100% in the form of time-vesting RSUs. Mr. Hill separated from the Company effective April 26, 2023. The terms of his separation, including the contractual severance payments and benefits received in connection therewith, are described under “Potential Payments upon Termination or Change in Control” starting on page 56. |
c. Annual Cash Incentive and Long-Term Incentive Plans
Following the Compensation Committee’s review of our compensation consultant’s competitive analysis of incentive programs sponsored by our peers, for 2024, the Compensation Committee approved (i) a modest increase in Mr. Corbett’s target AIP opportunity (125% in 2024 as compared to 115% in 2023) and (ii) a five percent (5%) increase to both target AIP and LTI opportunities for Ms. Brooks and Messrs. Matthews, Murray and Young from 2023 levels. Mr. Corbett’s LTI target opportunity, as well as the metrics approved for API and LTI opportunities for the NEOs in 2023, remain in place for 2024. We believe this performance-based compensation reflects our guiding principles of soundness, profitability and growth, and aligns our executive compensation with shareholder return based on our overall profitability on both a short-term and long-term basis, while including metrics that will discourage our NEOs from pursuing strategies that would expose the Company to excessive risk.
4. 2023 Compensation Paid or Awarded to our NEOs
| b. | Incentive Awards |
2023 AIP Opportunity and Awards
2023 AIP Opportunity and Awards Effective January 1, 2023, the target and maximum 2023 AIP opportunities for each of our NEOs were as follows:
2023 AIP Opportunity and Awards
| | Total AIP Opportunity | | | | | Name | Target ($) | % Base Salary | Maximum ($) | % Base Salary | | John C. Corbett, Chief Executive Officer | 1,199,738 | 115% | 1,799,606 | 172.5% | | William E. Matthews V, Chief Financial Officer | 393,400 | 70% | 590,100 | 105% | | Richard Murray IV, President of the Company | 374,500 | 70% | 561,750 | 105% | | Renee R. Brooks, Chief Operating Officer | 374,500 | 70% | 561,750 | 105% | | Stephen D. Young, Chief Strategy Officer | 626,000 | 100% | 939,000 | 150% | | Robert R. Hill, Jr., Executive Chairman | 719,900 | 115% | 1,079,850 | 172.5% |
2023 AIP Opportunity and Awards
The table below reflects the performance metrics under the 2023 AIP, including threshold, target, and maximum performance levels, the actual level of achievement for each metric, and the payout determined for such achievement as a percentage of target:
2023 AIP Opportunity and Awards
| AIP Goal (1) | Scale | | Metric | Metric Result | Performance Achieved | Payout Achieved (as a % of target) | | Adjusted PPNR less Net Charge-offs (in millions, 80%) | Threshold | 0% | $682 million | $759 million | Above Target | 100.59% | | | Target | 100% | $758 million | | | | | | Max | 150% | $833 million | | | | | NPAs/Loans +ORE (20%) (2) | Threshold | 0% | 25th percentile | 0.57% | Above maximum | 150% | | | Target | 100% | 50th percentile | | | | | | Max | 150% | 75th percentile | | | |
2023 AIP Opportunity and Awards
| (1) Adjusted PPNR less Charge-offs constitutes 80% of the AIP award determination, and NPAs/Loans + ORE constitutes 20% of the AIP award determination. Adjusted PPNR is a non-GAAP financial measure that exclude the impact of branch consolidation and merger-related expenses, gains or losses on AFS securities and other one-time adjustments such as extinguishment of debt cost, income tax benefit/cost related to the carryback of tax losses under the CARES Act, and adjustments (positive or negative) resulting for federal and state tax examinations for tax years outside of the measurement period. See reconciliation of GAAP to Non-GAAP measures in Appendix A. |
2023 AIP Opportunity and Awards
| (2) Ratio less than or equal to 0.75% equals maximum performance; peer group comparison if above 0.75%. |
2023 AIP Opportunity and Awards
The table below reflects the amounts earned under the 2023 AIP and paid to each of our NEOs based on the achievements described above:
2023 AIP Opportunity and Awards
| The table below reflects the amounts earned under the 2022 AIP and paid to each of our NEOs based on the achievements described above: | | | | | Name | Target (% Base Salary) | Performance Achieved | Earned AIP ($) | | John C. Corbett, Chief Executive Officer | 115% | 110.47% | 1,325,331 | | William E. Matthews V, Chief Financial Officer | 70% | 110.47% | 434,583 | | Richard Murray IV, President of the Company | 70% | 110.47% | 413,704 | | Renee R. Brooks, Chief Operating Officer | 70% | 110.47% | 413,704 | | Stephen D. Young, Chief Strategy Officer | 100% | 110.47% | 691,532 | | Robert R. Hill, Jr., Former Executive Chairman | 115% | 110.47% | 265,087 (1) |
2023 AIP Opportunity and Awards
| (1) Amount is pro-rated based on Mr. Hill’s partial year of service. |
2023 LTI Opportunity and Awards
2023 LTI Opportunity and Awards As discussed above, in 2023, each of our NEOs (other than Mr. Hill) received grants under our LTI plan that were comprised (i) 40% in the form of time-vesting RSUs that vest ratably over a three-year vesting period on January 1 of each year following the year of grant and (ii) 60% in the form of PSUs that are eligible to vest and become earned between 0% and 150% of target levels based on the achievement of a TBV Growth performance metric and a 3-Year ROATCE performance metric, equally weighted, over a three-year performance period, subject to the NEO’s continued employment with us through the vesting date. As noted above, in accordance with his employment agreement, Mr. Hill received 100% of his LTI in the form of time-vesting RSUs that vest ratably over a three-year vesting period on January 1 of each year following the year of grant. Effective January 1, 2023, the 2023 LTI opportunities as a percentage of base salary for each of our NEOs were as follows:
2023 LTI Opportunity and Awards
| NEO | Base Salary ($) | LTI Grant at Target (% of Base Salary) ($) | RSUs 40% ($) | PSUs 60% ($) | | John C. Corbett, Chief Executive Officer | 1,043,250 | 280% | 1,168,440 | 1,752,660 | | | | 2,921,100 | | | | William E. Matthews V, Chief Financial Officer | 562,000 | 125% | 281,000 | 421,500 | | | | 702,500 | | | | Richard Murray IV, President of the Company | 535,000 | 100% | 214,000 | 321,000 | | | | 535,000 | | | | Renee R. Brooks, Chief Operating Officer | 535,000 | 100% | 214,000 | 321,000 | | | | 535,000 | | | | Stephen D. Young, Chief Strategy Officer | 626,000 | 150% | 375,600 | 563,400 | | | | 939,000 | | | | Robert R. Hill, Jr., Former Executive Chairman | 626,000 | 280% | 1,752,800 | (2) | | | | 1,752,800 | | |
2023 LTI Opportunity and Awards
| (1) 40% in the form of time-vesting RSUs that vest ratably over a three-year vesting period on January 1 of each year following the year of grant and 60% in the form of PSUs that are eligible to vest and become earned between 0% and 150% of target levels based on the achievement of a TBV Growth performance metric and a 3-Year ROATCE performance metric, equally weighted, over a three-year performance period, subject to the NEO’s continued employment with us through the vesting date. |
2023 LTI Opportunity and Awards
| (2) Per his employment agreement, Mr. Hill’s LTI was 100% in the form of RSUs. |
2023 AIP Award Earned and Target LTI Award
2023 AIP Award Earned and Target LTI Award The table below sets forth the value of the AIP award earned and target LTI awards granted to each of our NEOs in respect of fiscal year 2023:
2023 AIP Award Earned and Target LTI Award
| NEO | Base Salary ($) | AIP Earned (1) ($) | LTI Target (2) ($) | Total ($) | | John C. Corbett, Chief Executive Officer | 1,043,250 | 1,325,331 | 2,921,100 | 5,289,681 | | William E. Matthews V, Chief Financial Officer | 562,000 | 434,583 | 702,500 | 1,699,083 | | Richard Murray IV, President of the Company | 535,000 | 413,704 | 535,000 | 1,483,704 | | Renee R. Brooks, Chief Operating Officer | 535,000 | 413,704 | 535,000 | 1,483,704 | | Stephen D. Young, Chief Strategy Officer | 626,000 | 691,532 | 939,000 | 2,256,532 | | Robert R. Hill, Jr., Former Executive Chairman | 626,000 | 265,087 | 1,752,800 | 2,643,887 |
2023 AIP Award Earned and Target LTI Award
| (1) AIP earned for fiscal year 2023 was paid to NEOs in the first quarter of 2024. |
2023 AIP Award Earned and Target LTI Award
| (2) Reflects the LTI award which was converted to shares as set forth in the Summary Compensation Table on page 49 and as further explained in Note (3) to the Summary Compensation Table. |
Other 2023 Awards
Other 2023 Awards In 2023, the Compensation Committee awarded Mr. Murray an additional grant of 6,173 RSUs, independent of the LTI plan, as a result of his assuming leadership over the commercial and consumer banking divisions upon the retirement of the Chief Banking Officer. These RSUs were valued at the time of grant at $76.16, the closing stock price as of January 24, 2023, the grant date.
2021 PSU Award Payouts
2021 PSU Award Payouts The January 2021 LTI grants to Ms. Brooks and Messrs. Corbett, Williams, Murray, and Young were comprised (i) 20% in the form of time-vesting RSUs that vested ratably over a three-year vesting period on January 1 of each year following the year of grant, and (ii) 80% in the form of PSUs that were eligible to vest and become earned based on the achievement of two equally weighted metrics, a TBV Growth performance metric and a 3-Year ROATCE performance metric, over a three-year performance period, subject to the NEO’s continued employment with us through the vesting date. Both performance objectives were measured over the three-year performance period commencing January 1, 2021, and ending December 31, 2023. Following the end of the three-year performance period
2021 PSU Award Payouts
| ISCUSSION AND | | | | Compensation DISCUSSION AND ANALYSIS |
2021 PSU Award Payouts
performance, the Compensation Committee reviewed our achievement against the performance goals and determined a payout of 138.8%, as more fully shown below:
2021 PSU Award Payouts
| | Performance Period: January 1, 2021, through December 31, 2023 | | | | | | Performance Metric | Threshold | Target | Maximum | Achievement | Payout | | TBV Growth | 10.0% | 11.0% | 12.0% | 16.6% | 150.0% | | Adjusted ROATCE | 25th percentile | 50th percentile | 75th percentile | 64th percentile | 127.6% | | Blended result: | | | | | 138.8% |
2021 PSU Award Payouts
The table below sets forth the value of the 2021 PSUs earned by the NEOs (other than Mr. Hill):
2021 PSU Award Payouts
| NEO | Number of Shares Acquired on Vesting (#) | Value Realized on Vesting ($) (1) | | John C. Corbett, Chief Executive Officer | 41,919 | 3,540,904 | | William E. Matthews V, Chief Financial Officer | 10,080 | 851,256 | | Richard Murray IV, President of the Company | 7,680 | 648,576 | | Renee R. Brooks, Chief Operating Officer | 7,680 | 648,576 | | Stephen D. Young, Chief Strategy Officer | 13,479 | 1,138,302 |
2021 PSU Award Payouts
| (1) The amounts presented reflect the fair value of PSUs, computed in accordance with FASB ASC Topic 718, which represents the closing stock price of the Company’s common stock on December 29, 2023, the last trading day of the year, multiplied by the number of shares earned on the vesting date, December 31, 2023. The number of shares acquired on vesting were released on February 29, 2024. |
a. Competitor Groups
a. Competitor Groups Peer Benchmarking. Each year, with assistance from its independent compensation consultant, the Compensation Committee reviews the compensation practices of our peers to assess the competitiveness of the compensation arrangements of our NEOs. See the discussion captioned “Executive Compensation Governance -- Role of Compensation Consultant” on page 38. Although benchmarking is an active tool used to measure compensation structures among peers, it is only one of the tools used by the Compensation Committee to determine total compensation. The Compensation Committee uses benchmarking primarily to ascertain competitive total compensation levels (including base salary, equity awards, cash incentives, etc.) with comparable institutions. Working with FW Cook, our independent compensation consultant, the Compensation Committee reviewed the compensation practices of our peers in 2023 to ascertain competitive total compensation levels for our NEOs (including base salary, equity awards, cash incentives, etc.) with comparable institutions. In addition to peer pay data, the Compensation Committee also assesses other market factors, the Company’s performance, individual roles, tenure and performance to set NEO pay levels. Using the selection criteria set forth below as guidelines, in July 2022, the Compensation Committee worked with FW Cook to validate the integrity of the peer group composition identified by the Company for 2022 benchmarking purposes for continued use in compensation benchmarking and relative performance comparison for 2023. The criteria considered were as follows:
a. Competitor Groups
| ● | Peer banks that are considered a peer by proxy advisor firms, other peer banks, or consider SouthState to be a peer for compensation benchmarking purposes |
a. Competitor Groups
| compensation for retirement income or other future financial needs. See the discussion entitled “Executive Compensation – Nonqualified Deferred Compensation in 2023” beginning on page 54 for additional information. |
a. Competitor Groups
| ● | CenterState Supplemental Executive Retirement Plans (“SERP”). Messrs. Matthews and Murry were each a participant in the nonqualified deferred compensation arrangements of NCOM which were designed to provide supplemental retirement income benefits to participants. CenterState assumed this SERP upon its acquisition of NCOM in April 2019 and was obligated under the agreement and applicable law to accelerate the unvested portion of all SERPs in connection with the CenterState Merger, including that of Messrs. Matthews and Murray. See the discussion entitled “Executive Compensation – Pension Benefits in 2023” on page 54 for additional information on this SERP. |
a. Competitor Groups
| c. | Employment Agreements |
Summary Compensation Table
Summary Compensation Table The following table shows compensation paid, accrued, or awarded by SouthState with respect to our named executive officers during the years indicated.
2023 Summary Compensation Table
2023 Summary Compensation Table
2023 Summary Compensation Table
| Name and Principal Position | Year | Salary ($) (1) | Bonus ($) (2) | Stock Awards ($) (3) (4) | Non-equity Incentive Plan compensation ($) (5) | Change in pension value and nonqualified deferred compensation earnings ($) (6) | All other compensation ($) (7) | Total ($) | | John C. Corbett Chief Executive Officer | 2023 | 1,043,250 | — | 2,746,330 | 1,325,331 | — | 51,748 | 5,166,659 | | | 2022 | 975,000 | — | 2,723,310 | 1,625,813 | — | 50,360 | 5,374,483 | | | 2021 | 975,000 | — | 2,931,598 | 1,365,653 | — | 39,300 | 5,311,551 | | William E. Matthews V Chief Financial Officer | 2023 | 562,000 | — | 660,536 | 434,583 | — | 44,690 | 1,701,809 | | | 2022 | 525,000 | — | 654,703 | 551,250 | — | 32,802 | 1,763,755 | | | 2021 | 525,000 | — | 703,522 | 447,605 | — | 24,868 | 1,700,995 | | Richard Murray IV (8) President of the Company | 2023 | 535,000 | — | 973,172 | 413,704 | — | 46,091 | 1,967,967 | | Renee R. Brooks Chief Operating Officer | 2023 | 535,000 | — | 503,037 | 413,704 | — | 14,046 | 1,465,787 | | | 2022 | 500,000 | — | 498,909 | 525,000 | — | 13,053 | 1,536,962 | | | 2021 | 500,000 | 330,000 | 536,950 | 426,921 | — | 12,488 | 1,806,359 | | Stephen D. Young Chief Strategy Officer | 2023 | 626,000 | — | 882,847 | 691,532 | — | 45,349 | 2,245,728 | | | 2022 | 585,000 | — | 875,421 | 877,500 | — | 42,185 | 2,380,106 | | | 2021 | 585,000 | — | 940,960 | 712,515 | — | 41,276 | 2,279,751 | | Robert R. Hill, Jr. (9) Former Executive Chairman | 2023 | 208,667 | — | — | 265,087 | — | 6,066,754 | 6,540,508 | | | 2022 | 585,000 | — | 1,774,008 | 975,488 | — | 16,429 | 3,350,925 | | | 2021 | 585,000 | 3,300,000 | 1,759,005 | 819,392 | — | 15,864 | 6,479,261 |
2023 Summary Compensation Table
| (1) Consists of total salary compensation paid by SouthState, including any amounts deferred at the executive’s election. |
2023 Summary Compensation Table
| (2) Reflects payment of a one-time lump-sum cash payment payable within thirty days following successful completion of the systems conversion following the CenterState Merger. |
2023 Summary Compensation Table
| (3) Other than as described below, the amounts presented reflect the grant date fair value of RSUs and PSUs, computed in accordance with FASB ASC Topic 718, by dividing the LTI opportunity by the 30-day average closing price through the month-end prior to the grant date and multiplying by the closing stock price on the grant date. For a discussion of assumptions used in the valuation of the stock awards see Note 19, “Share-based Compensation” in our Annual Report on Form 10-K for the year ended December 31, 2023. |
2023 Summary Compensation Table
In addition, on December 13, 2022, the Compensation Committee approved an adjustment to the calculation of the TBV Growth performance metric under the PSUs granted to each of the named executive officers (other than Mr. Hill) in each of fiscal years 2021 and 2022 (the “TBV Growth Adjustment”). As approved by the Compensation Committee, the TBV Growth Adjustment excludes from the calculation of TBV Growth changes in accumulated other comprehensive income (“AOCI”) during the relevant performance period for the PSUs. The calculation of TBV Growth, including any potential impact from AOCI, will occur at the end of the respective 3-year performance period (i.e., 2023 fiscal year end for the 2021 PSU award and 2024 fiscal year end for the 2022 PSU award). The Compensation Committee determined that this exclusion was consistent with certain other exclusions from TBV Growth that were permitted under the awards’ existing terms on the basis that recorded changes in AOCI from the required mark to market of the Company’s available for sale (“AFS”) investments is due primarily to accounting standards applicable to AFS as opposed to held to maturity investments rather than actual operating performance. As a result, the amounts in this column for 2022 and 2021 reflect the incremental fair value as a result of the December 2022 TBV Growth Adjustment, calculated as of December 13, 2022, in accordance with FASC ASC Topic 718. For Mr. Hill, no amounts are reported in this column for 2023 as such value is reflected in the “All Other Compensation” column as noted in footnote (7) below.
2023 Summary Compensation Table
| (4) The fair value of PSUs received by each NEO as of the grant date, assuming maximum performance, is as follows: Mr. Corbett, $2,471,697; Mr. Matthews, $594,505; Mr. Murray, $452,733; Ms. Brooks, $452,733; and Mr. Young, $794,539. Mr. Hill did not receive PSUs in 2023. The grant date for such PSU awards was January 24, 2023, for Messrs. Corbett, Matthews, Murray and Young and Ms. Brooks. |
2023 Summary Compensation Table
| (5) Reflects the dollar value of all amounts earned during the fiscal year pursuant to the AIP. See “Compensation Discussion and Analysis – Our 2023 Executive Compensation – Incentive Awards” for a description of how the Compensation Committee determined the incentive payments awarded in 2023. |
2023 Summary Compensation Table
| (6) Includes the portion of income earned during the fiscal year in the nonqualified deferred compensation plan exceeding 120% of the applicable long - term federal rate. During 2023, nonqualified deferred compensation plan balances experienced an unrealized loss, and there was no income exceeding 120% of the applicable long term federal rate. |
2023 Summary Compensation Table
| (7) The following table provides all other compensation in 2023, including perquisites (as defined under SEC Rules), which represents a small part of our executive compensation program and which increases the productivity of our executives and aligns our compensation program with competitive practices among our peers. The Company’s incremental costs of providing these benefits are described below. The table does not include any amounts for personal benefits provided to our NEOs for which we believe there is no aggregate incremental cost to us, including assistance with travel arrangements and the use of ground transportation and shared lodging of a spouse when accompanying an executive traveling for a business-related |
2023 Summary Compensation Table
| purpose. Personal expenses, including those incurred due to a spouse’s travel with an executive for a business-related purpose, are reimbursed to us by the executive. We believe that the perquisites we offer to our NEOs, as described below, are reasonable and appropriate. |
Grants of Plan-based Awards Table
Grants of Plan-based Awards Table The following table shows additional information regarding the AIP and LTI awards granted to our named executive officers in 2023.
Grants of Plan-Based Awards in 2023
Grants of Plan-Based Awards in 2023
Grants of Plan-Based Awards in 2023
| Name | Award type | Grant/ Approval date | Estimated future payouts under non-equity incentive plan awards (1) | | | Estimated future payouts under equity incentive plan awards (2) | | | All other stock awards: number of shares of stock or units (#) (3) | Grant date fair value of stock awards ($) (4) | | | | | Threshold ($) | Target ($) | Maximum ($) | Threshold (#) | Target (#) | Maximum (#) | | | | John C. Corbett | — | — | — | 1,199,738 | 1,799,606 | | | | | | | | RSU | 1/24/2023 | | | | | | | 14,424 | 1,098,532 | | | PSU | 1/24/2023 | | | | — | 21,636 | 34,454 | | 1,647,798 | | William E. Matthews V | — | — | — | 393,400 | 590,100 | | | | | | | | RSU | 1/24/2023 | | | | | | | 3,469 | 264,199 | | | PSU | 1/24/2023 | | | | — | 5,204 | 7,806 | | 396,337 | | Richard Murray IV | — | — | — | 374,500 | 561,750 | | | | | | | | RSU | 1/24/2023 | | | | | | | 8,815 (5) | 671,350 | | | PSU | 1/24/2023 | | | | — | 3,963 | 5,945 | | 301,822 | | Renee R. Brooks | — | — | — | 374,500 | 561,750 | | | | | | | | RSU | 1/24/2023 | | | | | | | 2,642 | 201,215 | | | PSU | 1/24/2023 | | | | — | 3,963 | 5,945 | | 301,822 | | Stephen D. Young | — | — | — | 626,000 | 939,000 | | | | | | | | RSU | 1/24/2023 | | | | | | | 4,637 | 353,154 | | | PSU | 1/24/2023 | | | | — | 6,955 | 10,433 | | 529,693 | | Robert R. Hill, Jr. | — | — | — | 719,900 | 1,079,850 | | | | | | | | RSU | 1/24/2023 | | | | | | | 21,638 | 1,647,950 |
Grants of Plan-Based Awards in 2023
| (1) These amounts represent ranges of the possible cash payout pursuant to the AIP component of our 2023 Executive Incentive Plan as described under “Compensation Discussion and Analysis – 2023 Compensation Paid or Awarded to Our NEOs – Incentive Awards – 2023 AIP Opportunity and Payout.” Actual amounts paid under the AIP are included in the column entitled “Non-Equity Incentive Plan Compensation” of the Summary Compensation Table above. See “Compensation Discussion and Analysis – Our 2023 Compensation Program – Annual Cash Incentive Plan and Long-Term Incentive Plans” above for a further description of the AIP. |
Grants of Plan-Based Awards in 2023
| (2) These amounts represent ranges of possible payouts for PSUs, denominated in the number of shares of common stock, granted under the LTI component of our 2023 Executive Incentive Plan as described under “Compensation Discussion and Analysis –2023 Executive Compensation –2023 LTI Opportunity”. |
Grants of Plan-Based Awards in 2023
| (3) These amounts represent the RSUs granted on January 24, 2023. RSUs granted under the LTI plan vest ratably over three (3) years on January 1 of each subsequent year. |
Grants of Plan-Based Awards in 2023
| (4) The amounts presented reflect the grant date fair value of RSUs and PSUs computed in accordance with FASB ASC Topic 718 by dividing the applicable LTI opportunity by the 30-day average closing price through December 31, 2022 (the month-end prior to the grant date), which was $81.01,to determine the number of shares awarded. The number of shares awarded was then multiplied by grant date price of $76.16, which was the closing stock price as of January 24, 2023. For a discussion of assumptions used in the valuation of the stock awards, see Note 19, “Share-based Compensation” in our Annual Report on Form 10-K for the year ended December 31, 2023. |
Grants of Plan-Based Awards in 2023
| (5) Mr. Murray received an additional grant of 6,173 RSUs, independent of the LTI plan, as a result of assuming leadership over the commercial and consumer banking divisions upon the retirement of the Chief Banking Officer. These RSUs were valued at the time of grant at $76.16, the closing stock price as of January 24, 2023, the grant date. |
Outstanding Equity Awards as of December 31, 2023
Outstanding Equity Awards as of December 31, 2023
Outstanding Equity Awards as of December 31, 2023
| Name | Option awards (1) | | | | | Stock awards (3) | | | | | | Number of Securities Underlying Unexercised Options (#) Exercisable (2) | Number of Securities Underlying Unexercised Options (#) Unexercisable | Equity Incentive Plan Awards: Number of Securities Underlying Unexercised Unearned Options (#) | Option Exercise Price ($) | Option Expiration Date | Number of shares/ units of stock that have not vested (#) (4) | Market value of shares/ units of stock that have not vested ($) (5) | Equity incentive plan awards: number of unearned shares/ units of stock that have not vested (#) (6) | Equity incentive plan awards: market value of unearned shares/ units of stock that have not vested ($) (5) | | John C. Corbett | — | — | — | — | — | 5,539 | 467,769 | — | — | | | — | — | — | — | — | 20,577 | 1,737,728 | — | — | | | — | — | — | — | — | 2,517 | 212,561 | — | — | | | — | — | — | — | — | 4,587 | 387,372 | — | — | | | — | — | — | — | — | 14,424 | 1,218,107 | — | — | | | — | — | — | — | — | — | — | 41,929 | 3,540,904 | | | — | — | — | — | — | — | — | 27,520 | 2,324,064 | | | — | — | — | — | — | — | — | 21,636 | 1,827,160 | | William E. Matthews V | — | — | — | — | — | 5,191 | 438,380 | — | — | | | — | — | — | — | — | 606 | 51,177 | — | — | | | — | — | — | — | — | 1,103 | 93,148 | — | — | | | — | — | — | — | — | 3,469 | 292,957 | 10,080 | 851,256 | | | — | — | — | — | — | — | — | 6,616 | 558,721 | | | — | — | — | — | — | — | — | 5,204 | 439,478 | | Richard Murray IV | — | — | — | — | — | 5,191 | 438,380 | — | — | | | — | — | — | — | — | 461 | 38,931 | — | — | | | — | — | — | — | — | 841 | 71,022 | — | — | | | — | — | — | — | — | 2,642 | 223,117 | — | — | | | — | — | — | — | — | 6,173 | 521,310 | — | — | | | — | — | — | — | — | — | — | 7,680 | 648,576 | | | — | — | — | — | — | — | — | 5,041 | 425,712 | | | — | — | — | — | — | — | — | 3,963 | 334,675 | | Renee R. Brooks | 1,333 | — | — | $66.32 | 1/22/2024 | — | — | — | — | | | 2,522 | — | — | $61.42 | 1/21/2025 | — | — | — | — | | | 2,443 | — | — | $63.54 | 1/20/2026 | — | — | | | | | 2,183 | — | — | $91.35 | 1/25/2027 | — | — | — | — | | | 2,816 | — | — | $91.05 | 1/17/2028 | — | — | — | — | | | — | — | — | — | — | 461 | 38,931 | — | — | | | — | — | — | — | — | 841 | 71,022 | — | — | | | — | — | — | — | — | 2,642 | 223,117 | — | — | | | — | — | — | — | — | — | — | 7,680 | 648,576 | | | — | — | — | — | — | — | — | 5,041 | 425,712 | | | — | — | — | — | — | — | — | 3,963 | 334,675 | | Stephen D. Young | — | — | — | — | — | 2,805 | 236,882 | — | — | | | — | — | — | — | — | 9,788 | 826,597 | — | — | | | — | — | — | — | — | 810 | 68,405 | — | — | | | — | — | — | — | — | 1,475 | 124,564 | — | — | | | — | — | — | — | — | 4,637 | 391,595 | — | — | | | — | — | — | — | — | — | — | 13,479 | 1,138,302 | | | — | — | — | — | — | — | — | 8,846 | 747,045 | | | — | — | — | — | — | — | — | 6,955 | 587,350 | | Robert J. Hill, Jr. | 9,036 | — | — | $91.35 | 1/25/2027 | — | — | — | — | | | 11,565 | — | — | $91.05 | 1/17/2028 | — | — | — | — |
Outstanding Equity Awards as of December 31, 2023
| (1) All options are fully vested and exercisable. The Company did not grant any options in 2023. |
Outstanding Equity Awards as of December 31, 2023
| (2) Represents the total number of shares subject to outstanding, vested, and unexercised options as of December 31, 2023. The number of options granted, and the options exercise price have been adjusted to reflect any applicable stock dividends. |
Outstanding Equity Awards as of December 31, 2023
| (3) The RSUs and PSUs awarded to Ms. Brooks and Messrs. Corbett, Matthews, Murray, and Young include the right to accrue dividend equivalents equal to the amount of cash shareholder dividends declared for each share of the Company’s common stock during the period between the grant date and the vesting date, and paid out in cash when, and to the extent, the underlying vested RSUs and PSUs to which they relate are settled. The table below presents the dividend equivalents accrued, but not yet settled, accumulated through December 31, 2023, for the RSUs and PSUs granted on January 26, 2021, January 19, 2022, and January 24, 2023. |
Outstanding Equity Awards as of December 31, 2023
| Name | Grant/ Approval date | Accrued Dividend Equivalent ($) | | John C. Corbett | 1/26/2021 | 262,700 | | | 1/29/2022 | 129,070 | | | 1/24/2023 | 73,562 | | William E. Matthews V | 1/26/2021 | 63,160 | | | 1/29/2022 | 31,030 | | | 1/24/2023 | 17,693 | | Richard Murray IV | 1/26/2021 | 48,118 | | | 1/29/2022 | 23,646 | | | 1/24/2023 | 13,474 | | Renee R. Brooks | 1/26/2021 | 48,118 | | | 1/29/2022 | 23,646 | | | 1/24/2023 | 13,474 | | Stephen D. Young | 1/26/2021 | 84,455 | | | 1/29/2022 | 41,490 | | | 1/24/2023 | 23,648 |
Outstanding Equity Awards as of December 31, 2023
| (4) For Messrs. Corbett, Matthews, Murray, and Young, the shares presented in the table above reflect the RSUs and PSUs granted by CenterState prior to the CenterState Merger. The pre-CenterState Merger awards granted by CenterState were converted into SouthState RSUs on June 8, 2020, and such awards are subject only to time-vesting through the remainder of the originally scheduled performance and/or vesting period (through May 2023), and otherwise remain subject to the same terms and conditions as applied immediately prior to the CenterState Merger, which includes a two-year holding period after vesting date. Of the amount reported above for Ms. Brooks and Messrs. Corbett, Matthews, Murray, and Young, totals of 1,762, 17,592, 2,928, 2,376, and 7,056, RSUs, respectively, have vested as of December 31, 2023, but are subject to holding periods ending in January 2024. Includes RSUs granted on January 26, 2021, January 19, 2022, and January 24, 2023, to Ms. Brooks and Messrs. Corbett, Matthews, Murray, and Young. The RSUs vest ratably over three years on January 1 of each subsequent year. Also includes RSUs granted on January 24, 2023, to Mr. Murray independent of the LTI plan. The RSUs vest ratably over three years on January 24 of each subsequent year. |
Outstanding Equity Awards as of December 31, 2023
| (5) Market value is based on a closing price of $84.45 as of December 29, 2023, the last trading day of the fiscal year. |
Outstanding Equity Awards as of December 31, 2023
| (6) Represents (a) the PSUs granted on January 26, 2021, at actual achievement to Ms. Brooks and Messrs. Corbett, Matthews, Murray, and Young, which were subject to certain performance measures and vested over a three-year performance period commencing on January 1, 2021, and ending on December 31, 2023; please see the discussion captioned “Compensation Discussion and Analysis – 2023 Compensation Paid or Awarded to Our NEOs –2021 PSU Award Payouts” beginning on page 44 for performance achievement and payouts; (b) the PSUs granted on January 19, 2022, at target, to Ms. Brooks and Messrs. Corbett, Matthews, Murray and Young, which are subject to certain performance measures and vest over a three-year performance period commencing on January 1, 2022, and ending on December 31, 2024, and (c) the PSUs granted on January 24, 2023, at target, to Ms. Brooks and Messrs. Corbett, Matthews, Murray and Young, which are subject to certain performance measures and vest over a three-year performance period commencing on January 1, 2023, and ending on December 31, 2025. The PSUs granted on January 26, 2021, and January 19, 2022, were modified in December 2022 to exclude the effects of changes in AOCI from the computation of TBV growth discussed in footnote 3 to the Summary Compensation Table set forth on page 49. See “Compensation Discussion and Analysis –2023 Compensation Paid or Awarded to our NEOs –2023 LTI Opportunity and Awards” on page 43 for a further description of the LTI plan. |
Outstanding Equity Awards as of December 31, 2023
The following table shows information regarding the value of options that were exercised and stock awards that vested during 2023:
Option Exercises and Stock Vested in 2023
Option Exercises and Stock Vested in 2023
Option Exercises and Stock Vested in 2023
| | Option awards | | Stock awards | | | | Number of shares | Value realized on | Number of shares | Value realized on | | Name | acquired on exercise (#)(1) | exercise ($)(2) | acquired on vesting (#)(3) | vesting ($)(2) | | John C. Corbett | — | — | 41,959 | 2,886,027 | | William E. Matthews V | — | — | 8,472 | 570,720 | | Richard Murray IV | — | — | 8,529 | 572,598 | | Renee R. Brooks | 1,223 | 44,153 | 5,296 | 371,158 | | Stephen D. Young | — | — | 19,491 | 1,337,089 | | Robert R. Hill, Jr. | 27,799 | 467,726 | 75,727 | 5,129,098 |
Option Exercises and Stock Vested in 2023
| (1) This column includes the gross number of options that were exercised during 2023 and includes any amounts that were withheld for applicable taxes. |
Option Exercises and Stock Vested in 2023
| (2) The value represents the gross number of options that were exercised, or shares or units that vested or settled after completing the required holding period, multiplied by the closing price of our common stock on the applicable vesting or exercise date (and, in the case of option exercises, less the exercise price), and includes any amounts that were withheld for applicable taxes. |
Option Exercises and Stock Vested in 2023
| (3) This column includes RSUs that vested or settled if subject to a holding period during 2023 and includes any amounts that were withheld for applicable taxes. For Mr. Hill, this column reflects the acceleration of vesting of equity awards in connection with his separation from employment as provided under the terms of his employment agreement. See the section captioned “Potential Payments upon Termination or Change in Control” starting on page 56 for more information. |
Option Exercises and Stock Vested in 2023
Any shares acquired either by the vesting of RSUs or the exercise of the stock options are subject to the Company’s stock ownership and retention guidelines. For more information on such guidelines, please see the discussion on page 42 captioned “Our 2023 Compensation Program – Stock Ownership and Retention Requirements.”
Nonqualified Deferred Compensation Table
Nonqualified Deferred Compensation Table The following table shows information about the participation by each named executive officer in our nonqualified deferred compensation plan. In 2023, Mr. Hill was the only NEO who participated in our nonqualified deferred compensation plan.
Nonqualified Deferred Compensation in 2023
Nonqualified Deferred Compensation in 2023
Nonqualified Deferred Compensation in 2023
| | | | | | Aggregate | Aggregate | | | | Executive | Registrant | Aggregate | withdrawals/ | balance at | | | | contributions | contributions | earnings | distributions | December 31, | | Name | Plan name | in 2023 ($)(1) | in 2023 ($) | in 2023 ($) | In 2023( $) | 2023 ($) | | John C. Corbett | | | | | | | | William E. Matthews V | | | | | | | | Richard Murray IV | | | | | | | | Renee R. Brooks | | | | | | | | Stephen D. Young | | | | | | | | Robert R. Hill, Jr. | SouthState Deferred Income Plan | | | 269,408 | 3,424,110 | 2,782,908 |
Nonqualified Deferred Compensation in 2023
| (1) Includes the total compensation to the above NEOs for which payment was deferred in 2023. These amounts also comprise part of the amounts disclosed in the “All other compensation” column of the Summary Compensation Table. |
Nonqualified Deferred Compensation in 2023
We have adopted a deferred compensation plan in which selected members of senior management, including the NEOs and/or other highly compensated employees, have the opportunity to elect to defer current compensation for retirement income or other future financial needs. Generally, the top five percent (5%) of highly compensated employees may participate in the plan. The plan is a nonqualified deferred compensation plan that is designed to be exempt from certain ERISA requirements as a plan that covers a select group of management and certain other highly compensated employees. Each year participants can choose to have their compensation for the upcoming year reduced by a certain whole percentage amount ranging between 5% and 80% or by a specific dollar amount (in all cases, subject to a minimum value established by us). Participants may also defer the settlement date of either 50% or 100% of RSU awards. In addition, we may make matching or partially-matching contributions for participant deferrals or discretionary contributions for any or all participant(s). Both types of employer contributions would be subject to certain vesting requirements. The plan includes forfeiture provisions, which can result from unvested amounts existing at terminations or from materially incorrect earnings that are subsequently adjusted or corrected. Deferrals are recorded in a bookkeeping account which is adjusted to reflect hypothetical investment earnings and losses of investment funds selected by the plan participant among those offered pursuant to the plan. Payments made under the plan will be made from our general assets and will be subject to claims of our creditors. Amounts payable under the plan are payable at the future times (or over the periods) designated by plan participants upon their enrollment in the plan and their annual renewal of enrollment and upon certain automatic distribution events (death, disability, separation from service and change in control). Amounts deferred under the plan will generally be subject to income taxes payable by the participant in the year in which received (end of the deferral period), but these deferred amounts are subject to employment taxes in the year of deferral. Contributions made by the employer in 2023 are set forth in the above table “Nonqualified Deferred Compensation in 2023.” No employer contributions have been made to this plan in the past to the above-named NEOs.
Pension Benefits Table
Pension Benefits Table The following provides information regarding CenterState’s Supplemental Executive Retirement Plans, or SERPs, in which Mr. Matthews participates. CenterState was obligated under each SERP agreement and applicable law to accelerate the unvested portion of all SERPs in connection with the CenterState Merger, including those of Mr. Matthews. Other than SERPs offered by CenterState, the Company did not maintain any other pension plans for its NEOs.
Pension Benefits in 2023
Pension Benefits in 2023
Pension Benefits in 2023
| | | Number of | Present value of | Payments | | | | years credited | accumulated | during last | | Name | Plan name | service (#) (1) | benefit ($) (2) | fiscal year ($) | | William E. Matthews V | SERP Agreements dated January 1, 2016, as amended September 12, 2018 | 12 | 1,930,144 | 0 | | Richard Murray IV | SERP Agreements dated January 1, 2016, as amended September 12, 2018 | 13 | 2,123,847 | 0 |
Pension Benefits in 2023
| (1) Years of credited service equal years of actual service. |
Pension Benefits in 2023
| (2) The amount reported above for Mr. Matthews represents the present fair value of the expected future payments using a discount rate of 5%. For additional information regarding retirement plans, please refer to Note 18 to the Company’s Consolidated Financial Statements in the 2023 Form 10-K. |
Pension Benefits in 2023
Messrs. Matthews and Murray were party to two SERP agreements with NCOM (assumed by CenterState in the NCOM merger), one dated January 1, 2016, and a second agreement dated September 12, 2018. Pursuant to the terms of the SERP agreements, if Mr. Matthews or Mr. Murray remains employed by NCOM or its successor companies through reaching age 65 (which will occur on July 19, 2029, for Mr. Matthews and July 6, 2027, for Mr. Murray), then he will be entitled to receive his “full benefit” in the form of monthly continuation payments for a period of up to 180 months commencing with the month following the month in which he reaches age 65. Each of Mr. Matthews and Mr. Murray has a full benefit amount in the amount of $120,000 under each agreement, for a total benefit of $240,000. Immediately prior to the CenterState Merger, each of Mr. Matthews and Mr. Murray was vested 33% and 20% in the current accrual balances of the 2016 SERP and 2018 SERP respectively; however, in connection with the closing of the CenterState Merger on June 7, 2020, pursuant to the SERP agreements, each SERPs fully vested and will be paid to Mr. Matthews and Mr. Murray in accordance with the terms of the SERP agreements, which is monthly beginning the month following the month such NEO reaches age 65 or subsequent separation from service. The annual total benefit payable to each of Mr. Matthews and Mr. Murray under the SERPs is $240,000. The SERP Agreements may be located by referencing the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2023, filed with the SEC on March 4, 2024, for (a) Mr. Matthews, as Exhibits 10.10, 10.16, 10.24 and 10.25, and (b) Mr. Murray, as Exhibits 10.8, 10.14, 10.20, 10.21.
Potential Payments upon Termination or Change in Control
Potential Payments upon Termination or Change in Control We have entered into certain agreements and maintain certain plans that will require us to provide compensation to our named executive officers in the event of his or her termination of employment or a change in control of the Company. The following table describes the potential payments to the NEOs (other than Mr. Hill) upon termination for various reasons or a change in control as of December 31, 2023. As noted above, in connection with his termination of employment, Mr. Hill was entitled under the terms of his employment agreement to receive the severance payments and benefits described in the narrative disclosure that follows the table.
Potential Payments upon Termination or Change in Control
| 6 | | | | | | | | | Compensation / Benefits | Voluntary Termination by Executive without Good Reason/Non- Retirement ($) | Qualifying Termination (not CIC related) ($) (1) (2) | Involuntary Termination by Company For Cause ($) | Termination in the event of Disability ($) (3) | Termination in the event of Death ($) (3) | Termination upon Retirement ($) | Change in Control (including a Qualifying Termination following a Change in Control) ($) (4) | | John C. Corbett | | | | | | | | | Payable Upon Termination | | | | | | | | | Compensation | | | | | | | | | Cash Severance | 0 | 7,957,536 | 0 | 0 | 0 | 0 | 7,719,389 (6) | | BOLI Split Dollar Agreement | 0 | 0 | 0 | 0 | 243,897 | 0 | 0 | | Additional Term Life Insurance | 0 | 0 | 0 | 0 | 212,141 | 0 | 0 | | Intrinsic Value of Performance Share Units | 0 | 4,305,992 | 0 | 4,305,992 | 4,305,992 | 4,305,992 | 4,305,992 | | Intrinsic Value of unvested Restricted Stock/Units (5) | 0 | 1,879,546 | 0 | 1,879,546 | 1,879,546 | 1,879,546 | 1,879,546 | | Benefits and Perquisites | | | | | | | | | Medical and Dental COBRA Insurance | 0 | 103,169 | 0 | 0 | 22,618 | 0 | 103,169 | | Tax Gross Up | 0 | 0 | 0 | 0 | 0 | 0 | 4,250,913 (6) | | Total | 0 | 14,246,243 | 0 | 6,185,538 | 6,664,194 | 6,185,538 | 18,259,009 | | William E. Matthews V | | | | | | | | | Payable Upon Termination | | | | | | | | | Compensation | | | | | | | | | Cash Severance | 0 | 1,669,875 | 0 | 0 | 0 | 0 | 2,783,125 | | BOLI Split Dollar Agreement | | 0 | 0 | 0 | 3,600,000 | 0 | 0 | | Intrinsic Value of Performance Share Units | 0 | 1,035,411 | 0 | 1,035,411 | 1,035,411 | 1,035,411 | 1,035,411 | | Intrinsic Value of unvested Restricted Stock/Units (5) | 0 | 452,077 | 0 | 452,077 | 452,077 | 452,077 | 452,077 | | Benefits and Perquisites | | | | | | | | | Medical and Dental COBRA Insurance | 0 | 38,860 | 0 | 0 | 16,817 | 0 | 38,860 | | Best Net of Tax Forfeiture | 0 | 0 | 0 | 0 | 0 | 0 | 0 | | Total | 0 | 3,196,223 | 0 | 1,487,489 | 5,104,306 | 1,487,489 | 4,309,473 | | Richard Murray IV | | | | | | | | | Payable Upon Termination | | | | | | | | | Compensation | | | | | | | | | Cash Severance | 0 | 1,590,000 | 0 | 0 | 0 | 0 | 2,650,000 | | BOLI Split Dollar Agreement | 0 | 0 | 0 | 0 | 3,600,000 | 0 | 0 | | Intrinsic Value of Performance Share Units | 0 | 788,737 | 0 | 788,737 | 788,737 | 788,737 | 788,737 | | Intrinsic Value of unvested Restricted Stock/Units (5) | 0 | 344,340 | 0 | 865,650 | 865,650 | 865,650 | 865,650 | | Benefits and Perquisites | | | | | | | | | Medical and Dental COBRA Insurance | 0 | 37,972 | 0 | 0 | 16,437 | 0 | 37,972 | | Best Net of Tax Forfeiture | 0 | 0 | 0 | 0 | 0 | 0 | 0 | | Total | 0 | 2,761,049 | 0 | 1,654,387 | 5,270,824 | 1,654,387 | 4,342,359 | | Renee R. Brooks | | | | | | | | | Payable Upon Termination | | | | | | | | | Compensation | | | | | | | | | Cash Severance | 0 | 909,500 | 0 | 0 | 0 | 0 | 2,650,000 | | Intrinsic Value of Performance Share Units | 0 | 788,737 | 0 | 788,737 | 788,737 | 0 | 788,737 | | Intrinsic Value of unvested Restricted Stock/Units (5) | 0 | 344,340 | 0 | 344,340 | 344,340 | 0 | 344,340 | | Benefits and Perquisites | | | | | | | | | Medical and Dental COBRA Insurance | 0 | 24,699 | 0 | 0 | 24,699 | 0 | 24,699 | | Best Net of Tax Forfeiture | 0 | 0 | 0 | 0 | 0 | 0 | 0 | | Total | 0 | 2,067,276 | 0 | 1,133,077 | 1,157,776 | 0 | 3,807,776 | | Stephen D. Young | | | | | | | | | Payable Upon Termination | | | | | | | | | Compensation | | | | | | | | | Cash Severance | 0 | 4,437,113 | 0 | 0 | 0 | 0 | 4,676,864 (6) | | BOLI Split Dollar Agreement | 0 | 0 | 0 | 0 | 226,167 | 0 | 0 | | Additional Term Life Insurance | 0 | 0 | 0 | 0 | 193,430 | 0 | 0 | | Intrinsic Value of Performance Share Units | 0 | 1,384,144 | 0 | 1,384,144 | 1,384,144 | 0 | 1,384,144 | | Intrinsic Value of unvested Restricted Stock/Units (5) | 0 | 604,342 | 0 | 604,342 | 604,342 | 0 | 604,342 | | Benefits and Perquisites | | | | | | | | | Medical and Dental COBRA Insurance | 0 | 88,885 | 0 | 0 | 22,069 | 0 | 88,885 | | Tax Gross Up | 0 | 0 | 0 | 0 | | 0 | 2,099,476 (6) | | Total | 0 | 6,514,484 | 0 | 1,988,486 | 2,430,152 | 0 | 8,853,710 |
Potential Payments upon Termination or Change in Control
| (1) A “Qualifying Termination” consists of an involuntary termination by the Company without cause or a voluntary termination by the employee for good reason. |
Potential Payments upon Termination or Change in Control
| (2) PSUs will vest at 100% of the greater of target or actual performance through the end of the most recent quarter ended. All unvested units will immediately vest and be considered vested shares. CenterState equity awards converted into SouthState equity awards upon consummation of the CenterState Merger will vest on a “double-trigger” basis upon a termination of employment by the Company without cause or by the award holder for good reason within three years following the closing of the CenterState Merger. |
Potential Payments upon Termination or Change in Control
| (3) All unvested RSUs and any accrued but unpaid dividend equivalents will immediately vest and be considered vested RSUs upon the date of death or disability. Vesting of PSUs is not accelerated upon termination in the event of disability. Rather, awards vest at target performance level as scheduled after the performance period on a pro-rata basis, based on the percentage of the performance period for which the participant was employed. |
Potential Payments upon Termination or Change in Control
| (4) If a NEO retires because of reaching the age of 65 or reaching the age of 55 plus ten years of service and agrees to sign a non-compete for a two-year period from date of retirement, then all unvested PSUs and RSUs will immediately vest and will be paid after the holding period; otherwise, such shares will vest pro-rata as of the date of retirement, to be paid after the applicable performance and holding period. |
Potential Payments upon Termination or Change in Control
| (5) The value used in the table above is equal to the amount of vested and unvested restricted shares or units as of December 31, 2023, multiplied by $84.45 per share, the closing price of the Company’s common stock on December 29, 2023, the last trading day of the year, as reported by the NYSE. |
Potential Payments upon Termination or Change in Control
| (6) These figures represent amounts payable upon a “qualifying termination” within 12 months following a change in control, except that amounts reported as Cash Severance and Tax Gross Up for Messrs. Corbett and Young would be payable upon the occurrence of a change in control even without a qualifying termination under the terms of their historic grandfathered employment agreements in place at the time of the CenterState Merger, as described below. |
Narrative to Potential Payments upon Termination or Change in Control Table
Narrative to Potential Payments upon Termination or Change in Control Table Amounts shown in the table above and in the discussion below assume that a change in control occurred on, or the NEO (other than Mr. Hill) terminated employment on, December 31, 2023, and are estimates of the amounts the NEO would receive upon termination pursuant to the employment agreement applicable to each such executive as in effect on December 31, 2023, and certain retention letters that Messrs. Corbett and Young entered into at the time of the CenterState Merger that have since been terminated (as described further below). The actual amounts to be paid can be determined only at the time of a change in control or the NEO’s termination of employment. The amounts reported above do not include amounts payable on a termination of employment or change in control that would be provided to a NEO under plans and arrangements that are generally available to all salaried employees or that are otherwise reported in the Summary Compensation, Pension Benefits in 2023, and 2023 Non-qualified Deferred Compensation tables. Please see the sections below captioned “Employment and Non-Competition Agreements Effective as of June 7, 2020”, “CenterState Employment and Non-Competition Agreements assumed at CenterState Merger” for a summary of employment agreements and the related potential payments upon termination or change of control. In the case of Mr. Hill, please see the section below captioned “Robert Hill Separation Agreement” for the amounts that were actually paid to Mr. Hill in connection with his separation from employment on April 26, 2023. For purposes of the employment agreements in effect with the NEOs, the terms “good reason,” “cause,” “disability” and “change in control” are defined in the applicable NEO’s employment agreement.
Messrs. Matthews and Murray
| CEo pay ratio |
CEO PAY RATIO
CEO PAY RATIO Below are: the (i) 2023 annual total compensation of Mr. Corbett, our CEO; (ii) the 2023 annual total compensation of our median employee; (iii) the ratio of the annual total compensation of our CEO to that of our median employee; and (iv) the methodology we used to calculate our CEO pay ratio.
CEO PAY RATIO
| CEO Pay Ratio | | | CEO Annual Total Compensation | $5,166,658 | | Median Employee Annual Total Compensation | $64,879 | | CEO to Median Employee Pay Ratio | 81.4 to 1 |
PAY VERSUS PERFORMANCE
PAY VERSUS PERFORMANCE The table below reflects compensation of the Company’s Principal Executive Officer (“PEO”) and average compensation of the Company’s non-PEO NEOs during 2020 through 2023, both as reported in the Summary Compensation Table and with certain adjustments to reflect the "compensation actually paid”, as defined under SEC rules. In addition, the table provides our cumulative Total Shareholder Return (“TSR”), the cumulative TSR of our peer group TSR (using the KBW Regional Banking index), Net Income, and Adjusted PPNR, which is the “company selected measure” chosen for purposes of this disclosure.
Pay Versus Performance Table
Pay Versus Performance Table In determining the Compensation Actually Paid (the “CAP”) for our NEOs, we are required to make various adjustments to amounts that have been previously reported in the Summary Compensation Table (the “SCT”) for the last four calendar years. The table below summarizes compensation values both previously reported in our SCT, as well as footnotes of the adjusted values for 2023.
Pay Versus Performance 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 |
Pay Versus Performance Table
| (1) The Pay Versus Performance table reflects required disclosures for fiscal years 2023, 2022, 2021 and 2020. |
Pay Versus Performance Table
| (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. |
Pay Versus Performance Table
| (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. |
Pay Versus Performance Table
| (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. |