The chairman of Alabama's Compass Bancshares won a bitter proxy battle last year, but it cost him both a salary increase and a bonus.
The zero bonus for chairman and chief executive D. Paul Jones Jr. - revealed in Compass' 1995 proxy statement - comes at a time when many other banks around the country, flush with record profits, are granting generous awards of cash and stock to their top executives.
But the Birmingham-based bank, which has $10.3 billion of assets, requires an earnings per share gain of at least 10% before granting a bonus to its CEO and other senior managers. Compass earned $110.3 million last year, for a 9% gain in earnings per share, to $2.87.
Mr. Jones, who was not available to comment, had earned bonuses of $318,735 in 1994 and $408,098 the year before. He was paid the same $450,000 salary as in 1994 - which represented a $41,902 increase from 1993.
Three other senior executives - chief financial officer Garrett R. Hegel; Charles E. McMahen, chairman and CEO of Compass' Texas bank; and Byrd Williams, an executive vice president - received salary increased but no bonuses.
Compass general counsel Jerry W. Powell, who did get a $7,475 bonus tied to the performance of his particular department, said last year's "costly and disruptive proxy contest" affected both executive bonuses and employee stock ownership plan contributions.
Mr. Powell said Mr. Jones decided not to ask for an increase in salary last year because of costs associated with the proxy fight, estimated by Compass officials at $2 million.
Early last year, several directors, led by Compass founder and former chairman Harry B. Brock Jr., attempted to force a sale of the bank. Although Mr. Jones beat back the attempt and retained control of the board, expenses associated with the contest contributed to Compass' earnings falling short of the 10% target in 1995.
Mr. Brock, whose board term expires next year, says he will not oppose the slate of five directors management has proposed for election at Compass' April 9 shareholders meeting.
Mr. Brock says he still believes he did the right thing in attempting to sell the bank last year. But he said he now supports Mr. Jones' previously announced goal of achieving a 15% annual compounded growth rate in earnings per share between 1995 and 1997.