HBHC Hancock Holding Company (delisted)

N ote 1.  Description of the Plan



The following description of the Hancock Whitney Corporation 401(k) Savings Plan , formerly known as the Hancock Holding Company 401(k) Savings Plan, (the “ Plan ” ) provides only general information.  Participants should refer to the Summary Plan Description for a more c omplete description of the Plan’s provisions.



General



The Plan is a defined contribution plan established under the provisions of Section 401(a) of the Internal Revenue Cod e (“ IRC ” ), which includes a qualified cash or deferred arrangement as described in Section 401(k) of the IRC for eligible employees of Hancock Whitney Corporation and its subsidiaries (the “Company” and the “Sponsor” ). All full-time and part-time employees of the Company who have completed 60 days of continuous service and are age 18 or older are eligible to participate.  The Plan is subject to the provisions of the Employee Retirement Income Sec urity Act of 1974, as amended (“ERISA” ).



Plan Administration



Hancock Whitney Bank, a subsidiary of the Sponsor ,   serves as the Plan’s Trustee .   The Plan is administered by an officer of Hancock Whitney Bank.   Prior to December 1, 2017, the Plan’s assets were in custody of Charles Schwab Trust Company and the Plan utilized the record   keeping services of EPIC Advisors, Inc.   On December 1, 2017, Em power Retirement, a subsidiary of Great West Trust Company, LLC, became the Plan’s record keeper and custodian of its assets.  



Contributions



Eligible employees may elect to defer compensation of up to the Internal Revenue Service (“IRS”) limitation of $18,000 for 2017 and 2016 . In addition, participants age 50 and over have the option to defer up to an additional $6,000 for 2017 and 2016 , through the Plan’s catch-up contribution provisions. The Company offers a safe harbor match of 100 percent of the first 1 percent of compensation deferred by a participant, and 50 percent of the next 5 percent of eligible compensation deferred. Eligible employees who are not participating in the Plan and have not actively opted out of participation are automatically enrolled at an initial 3 percent deferral rate.



On June 22, 2017, the Board of Directors of the Company approved certain amendments to both the Plan and the Hancock Whitney Corporation Pension Plan and Trust Agreement (the “Pension Plan”), a related benefit plan of the Sponsor.  The Pension Plan was amended to exclude from eligibility to participate any individual hired or rehired by the Company after June 30, 2017. The Pension Plan amendment further provides that the accrued benefit of each participant in the Pension Plan whose combined age plus years of service as of January 1, 2018 totals less than 55 will be frozen as of January 1, 2018 and will not thereafter increase.  The Plan was amended for participants whose benefits are frozen under the Pension Plan, to add an enhanced Company contribution beginning January 1, 2018, in the amount of 2%, 4% or 6% of such participant’s eligible compensation, based on the participant’s age and years of service with the Company. The Plan’s amendment further provides that the Company will contribute to the benefit of those associates of the Company hired or rehired after June 30, 2017 and those associates of the Company never enrolled in the Pension Plan an additional basic contribution in an amount equal to 2% of the associate’s eligible compensation begin n ing January 1, 2018 .



Participant Accounts



Each participant’ s account i s credited with the participant’ s contributions, the Company’ s matching contribution, and earnings and losses and is also charged with an allocation of administrative expenses to the extent such expenses are paid by the Plan.  All allocations are based on participant earnings or account balances, as defined by the Plan.



The Plan provides benefits based solely upon the amounts contributed to the participant’ s account and any income, expenses and gains and losses on investment, which may b e allocated to such participant’ s account.

Vesting



The Company’ s   safe harbor matching contributions and associated earnings or losses vest immediately after the participant has completed two years of service. Effective January 1, 2018, the Company’s additional basic and enhanced contributions will vest after the participant has completed three years of service.  All participants vest 100 percent upon termination of employment due to death or permanent disability.



Forfeitures



Forfeitures of employer matching contributions and allocated earnings and losses thereon are used to reduce employer contributions and Plan expenses.  At December 31, 2017 and 2016 , the forfeited amounts available for reducing future employer contributions and Plan expenses were $ 72,263 and $ 233 , 828 respectively.  During 201 7 and 201 6 , forfeitures totaling $ 200,000 and $ 169,644 , respectively, were used to reduce employer contributions.



Investment Options



The Plan allows participants to direct contributions into various investment options.  As of December 31, 2017, the Plan’s investment options include d mutual funds, fixed annuities , a common collective trust fund, and Hancock Whitney Corporation common stock.



Notes Receivable from Participants



Participants are allowed to borrow from their accounts in amounts ranging from a minimum of $1,000 to a maximum of 50 percent of the account balance, not to exceed $50,000. Loan maturities generally range from 1-5 years with one loan available at any time.  The loans are collateralized by the balance in the participant's account and are to bear interest at the prime rate as reported in the Wall Street Journal plus 1 percent or such other rate determined by the Plan Administrator on a uniform and consistent basis.  The interest rate on outstanding loan balances ranged between 4.25 percent and 5 .25 percent for 2017 and 2016 .  Principal and interest is paid ratably through payroll deductions.  Upon origination of a loan, participants are charged an administrative fee that is reflected in administrative expenses in the statement of changes in net assets available for benefits. Participant loans are presented as notes receivable from participants in the statements of net assets available for plan benefits.



The Plan administrator declares a default if the participant fails to pay any regular installment of principal and interest when due and such failure continues until the last day of the calendar quarter following the quarter in which the failure first occurred.  Should a default occur and be continuing, the trustee will report the amount of the principal and accrued interest as a deemed distribution as of the last day of the calendar year in which the default occurs.  Management has evaluated participant notes receivable for collectability and has determined that no allowance is considered necessary.



Payment of Benefits



Benefits are generally payable on termination of employment, retirement, attainment of age 59.5, death, or disability.  Benefits may be paid by either lump-sum payment, periodic payments over an actuarially determined period, or rolled over into a qualified plan, subject to regulatory requirements.  Hardship distributions are also available from participants ’ elective deferral accounts, subject to regulatory requirements.  Distributions from participant rollover sources can be withdrawn at any time.

Note 2.  Summary of Significant Accounting Policies



Basis of Presentation



The accompanying financial statements of the Plan have been prepared on the accrual basis of accounting in accordance with accounting principles generally accepted in the United States of America.  Certain prior period amounts have been reclassified to conform to current period presentation.

Use of Estimates



The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and changes therein and disclosure of contingent assets and liabilities.  Actual results could differ from those estimates.



Investment Valuation and Income Recognition



All Plan investments as of December 31, 201 7 and 201 6   were held by the   Trustee and are reported at contract value or fair value.  Contract value represents contributions made under the contract, plus earnings, less participant withdrawals, and administrative expenses. See Note 7 for further discussion of fully-benefit responsive contracts. Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date.  Mutual funds and common stock are valued at quoted market prices that represent the value of shares held by the plan at year   end. The common collective trust fund   is reported at fair value using net asset value per share (or its equivalent) as a practical expedient. See Note 8 for   further discussion and disclosure related to fair value measurements.    



Purchases and sales of investments are recorded on a trade-date basis. Dividends are recorded on the ex-dividend date.  Realized and unrealiz ed gains and losses on the Plan’ s investments are included in net appreciation in the fair value of investments in the statements of changes in net assets available for benefits.



Participant notes receivable are recorded at their unpaid principal balance plus any accrued but unpaid interest. Interest income is recorded on the accrual basis.



Payment of Benefits



Benefits are recorded when paid. 



Administrative Expenses



Administrative expenses related to record keeping for the Plan are paid by the Plan to an unrelated third-party.  Those expenses not paid by the Plan are paid for by the Company, which include all trustee fees to Hancock Whitney Bank .  The Plan paid $ 331,679 and $ 241,271   for   administrative expenses related to the Plan for t he years ended December 31, 2017 and 2016 , respectively.



Note 3 .  Tax Status



The Plan received a favorable determination letter dated March 8, 2018 stating that the Plan is qualified under Section 401 of the IRC and is therefore exempt from federal income taxes. The determination letter applies to Plan amendments through January 25, 2017.  Although the Plan was amended subsequent to that date, the Plan administrator and the Plan’s tax counsel believe that the Plan is designed and is currently being operated in compliance with applicable provisions of the IRC.    



The Plan had no uncertain tax positions at December 31, 201 7 or 201 6 .  If interest and penalties are incurred related to uncertain tax positions, such amounts are recognized in income tax expense.



Note 4 .  Related Party Transactions



The Trustee is a subsidiary of Hancock Whitney Corporation .  Transactions between the Plan and Trustee, or the Plan and the S ponsor , are considered to be exempt party-in-interest transactions. Mutual fund investments where Hancock Whitney Bank acts as an investment advisor totaled $ 25,560,677 and $ 67,143,089 as of December 31, 201 7 and 201 6 , respectively. Additionally, at December 31, 201 7 and 201 6 , the Plan owned $ 36,724,819  ( 741,916 shares) and $ 33,370,692 (774,262 shares) , respectively, in Hancock Whitney Corporation common stock.  During 201 7 and 201 6 , the Plan recorded $ 725,736 and $ 829,949 , respectively, in dividend income on Hancock Whitney Corporation common stock. The Plan paid no administrative fees to the Trustee during 201 7 and 201 6 .

Note 5 .  Risks and Uncertainties



The Plan invests in various investment securities.  Investment securities are exposed to various risks such as interest rate, market and credit risks.  Due to the level of risk associated with certain investment securities, it is at least reasonably possible that changes in the values of investment securities will occur in the near term and that such changes could materially affect participants' account balances and the amounts reported in the statements of net assets available for benefits.

Note 6 .  Plan Termination



Although it has not expressed any intent to do so, the Company has the right under the Plan to discontinue its contributions at any time and to terminate the Plan subject to the provisions of ERISA.  In the event that the Plan is terminated, participants would become 100 percent vested in their account.

Note 7. Fully Benefit -Responsive Investment Contract



During the 2017 Plan year, the Plan entered into a group annuity contract with Great-West Life & Annuity Insurance Company, a related entity of the Plan’s custodian. The contract is a traditional investment contract. This contract meets the fully benefit- responsive investment contract criteria and therefore is reported at contract value. Contract value is the relevant measure for fully benefit- responsive investment contracts because this is the amount received by participant if they were to initiate permitted transactions under the terms of the Plan. Contract value represents contributions made under each contract, plus earnings, less participant withdrawals, and administrative expenses. As a traditional investment contract, the Plan owns only the contract itself.



The traditional investment contract held by the Plan is a guaranteed investment contract. The contract issuer is contractually obligated to repay the principal and interest at a specified interest rate that is guaranteed to the Plan. The crediting rate is based on a formula established by the contract issuer but may not be less than zero percent. The credit rating is reviewed on a quarterly basis for resetting. The contract does not have a maturity date.



The Plan’ s ability to receive amounts due in accordance with the fully benefit- responsive investment contract is dependent up on the third-party issuer’s ability to meet its fi nancial obligations. The issuer’ s ability to meet its contractual obligations may be affected by future economic and regulatory developments.



Certain events might limit the ability of the Plans to transact at contract value with the contract issuer. These events may be different under each contract. Examples of such ev ents include, but are not limited to the Plan’s failure to qualify under Section 401(a) of the IRC or the failure of the trust to be tax-exempt under section 501(a) of the IRC; premature termination of the contract; Plan termination or merger; changes to the Plan’s prohibition or competing investment options; and bankruptcy of the Plan Sponsor or other events of the Sponsor, such as divestitures, that significantly affect the Plan’s normal operations.



No events are probable of occurring that might limit the ability of the Plan to transact at contrac t value with the contact issuer and that also would limit the ability of the Plan to transact at contact value with the participants.



Note 8 .  Fair Value Measurements



Financial Accounting Standards Board ( FASB ) Accounting Standards Codification   ( ASC ) Topic 820, Fair Value Measurements and Disclosures , establishes a framework for measuring fair value.  That framework provides a fair value hierarchy that prioritizes the inputs to valuation techniques used to measure fair value.  The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurements)

and the lowest priority to unobservable inputs (Level 3 measurements).  The three levels of the fair value hierarchy under ASC Topic 820 are described as follows:









The asset ’s or liability’ s fair value measurement level within the fair value hierarchy is based on the lowest level of any input that is significant to the fair value measurement.  Valuation techniques used need to maximize the use of observable inputs and minimize the use of unobservable inputs.



The following is a description of the valuation methodologies used for assets measured at fair value on a recurring basis.  There have been no changes in the methodologi es used at December 31, 2017 and 2016 .



Mutual funds and money market funds : Valued at the closing price reported on the active market on which the individual securities are traded.    



Employer securities : These common stocks are valued at the closing price reported on the active market on which the individual securities are traded.  



Common collective trust fund:  Reported at fair value using net asset value per share (or its equivalent) as a practical expedient and not classified in the fair value hierarchy in accordance with ASC Subtopic 820-10.  The fair values presented in the hierarchy tables are intended to permit reconciliation of the fair value hierarchy to the investments at fair value as presented in the Statements of Net Assets Available for Benefits.



The preceding methods described may produce a fair value calculation that may not be indicative of net realizable value or reflective of future fair values.  Furthermore, although the Plan believes its valuation methods are appropriate and consistent with other market participants, the use of different methodologies or assumptions to determine the fair value of certain financial instruments could result in a different fair value measurement at the reporting date.



The following table sets forth by level, within the fair value hierarchy, the Plan’ s assets measured at fair value on a recurring basis as of December 31, 201 7 and 201 6 :









N ote 9 .     Reconciliation of Financial Statements to Form 5500  



There are no differences between net assets available for benefits or changes in net assets available for benefits   in the financial statements and the Plan’ s Form 5500 as of and for the year ended December 31, 2016 . 



The following tables reconcile net assets available for Plan benefits per the audited financial statements to net assets per the Form 5500, and increase in net assets available for benefits per the audited financial statements to net income per the Plan’s Form 5500.