-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, Tm+eXySimuKsDE+WbBf+6f+w6Ko0Aw5xnWGVm3Rbd7m0ay9M5Ow+zD0dAI8qrEs7 gv5oZN/qHH3Vgg0T/+j6FQ== 0000904280-97-000191.txt : 19971017 0000904280-97-000191.hdr.sgml : 19971017 ACCESSION NUMBER: 0000904280-97-000191 CONFORMED SUBMISSION TYPE: DEF 14A PUBLIC DOCUMENT COUNT: 1 CONFORMED PERIOD OF REPORT: 19971113 FILED AS OF DATE: 19971016 SROS: NASD FILER: COMPANY DATA: COMPANY CONFORMED NAME: HCB BANCSHARES INC CENTRAL INDEX KEY: 0001029740 STANDARD INDUSTRIAL CLASSIFICATION: SAVINGS INSTITUTION, FEDERALLY CHARTERED [6035] IRS NUMBER: 621670792 STATE OF INCORPORATION: OK FISCAL YEAR END: 0630 FILING VALUES: FORM TYPE: DEF 14A SEC ACT: SEC FILE NUMBER: 000-22423 FILM NUMBER: 97696467 BUSINESS ADDRESS: STREET 1: HEARTLAND COMMUNITY BANK STREET 2: 237 JACKSON STREET CITY: CAMDEN STATE: AK ZIP: 71701 BUSINESS PHONE: 5018366841 MAIL ADDRESS: STREET 1: HEARTLAND COMMUNITY BANK STREET 2: 237 JACKSON STREET CITY: CAMDEN STATE: AK ZIP: 71701 DEF 14A 1 NOTICE, PROXY STATEMENT AND PROXY CARD SCHEDULE 14A INFORMATION Proxy Statement Pursuant to Section 14(a) of the Securities Exchange Act of 1934 (Amendment No. ) Filed by the Registrant [X] Filed by a Party other than the Registrant [ ] Check the appropriate box: [ ] Preliminary Proxy Statement [X ] Definitive Proxy Statement [ ] Definitive Additional Materials [ ] Soliciting Material Pursuant to Rule 14a-1(c) or Rule 14a-12 [ ] Confidential, For Use of the Commission Only (as permitted by Rule 14a-6(c)(2)) HCB BANCSHARES, INC. - ---------------------------------------------------------------- (Name of Registrant as Specified in its Charter) - ---------------------------------------------------------------- (Name of Person(s) Filing Proxy Statement) Payment of Filing Fee (Check the appropriate box): [X] NO FEE REQUIRED [ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and 0-11. 1. Title of each class of securities to which transaction applies: ________________________________________________________________ 2. Aggregate number of securities to which transaction applies: ________________________________________________________________ 3. Per unit price or other underlying value of transaction computed pursuant to Exchange Act Rule 0-11 (set forth the amount on which the filing fee is calculated and state how it was determined): ________________________________________________________________ 4. Proposed maximum aggregate value of transaction: ________________________________________________________________ 5. Total fee paid: ________________________________________________________________ [ ] Fee paid previously with preliminary materials: ________________________________________________________________ [ ] Check box if any part of the fee is offset as provided by Exchange Act Rule 0-11(a)(2) and identify the filing for which the offsetting fee was paid previously. Identify the previous filing by registration statement number, or the Form or Schedule and the date of its filing. 1. Amount previously paid: ____________________________________________ 2. Form, Schedule or Registration Statement no.: ____________________________________________ 3. Filing Party: ____________________________________________ 4. Date Filed: ____________________________________________ [HCB BANCSHARES, INC. LETTERHEAD] October 15, 1997 Dear Stockholder: We invite you to attend the annual meeting of stockholders of HCB Bancshares, Inc. to be held at the Charles O. Ross Center, 746 California Avenue, S.W., Camden, Arkansas, on Thursday, November 13, 1997 at 10:00 a.m., local time. The accompanying notice and proxy statement describe the formal business to be transacted at the meeting. During the meeting, we will also report on the operations of the Company's principal subsidiary, HEARTLAND Community Bank. Directors and officers of the Company, as well as representatives of Miller, England & Company, the Company's independent auditors, will be present to respond to any questions the stockholders may have. ON BEHALF OF THE BOARD OF DIRECTORS, WE URGE YOU TO SIGN, DATE AND RETURN THE ACCOMPANYING PROXY CARD AS SOON AS POSSIBLE EVEN IF YOU CURRENTLY PLAN TO ATTEND THE ANNUAL MEETING. Your vote is important, regardless of the number of shares you own. This will not prevent you from voting in person but will assure that your vote is counted if you are unable to attend the meeting. Sincerely, /s/ Vida H. Lampkin Vida H. Lampkin Chairman of the Board, President and Chief Executive Officer HCB BANCSHARES, INC. 237 JACKSON STREET, S.W. CAMDEN, ARKANSAS 71701-3941 (870) 836-6841 NOTICE OF ANNUAL MEETING OF STOCKHOLDERS TO BE HELD ON NOVEMBER 13, 1997 NOTICE IS HEREBY GIVEN that the annual meeting of stock- holders (the "Annual Meeting") of HCB Bancshares, Inc. (the "Company") will be held at the Charles O. Ross Center, 746 California Avenue, S.W., Camden, Arkansas, on Thursday, November 13, 1997 at 10:00 a.m., local time. A proxy statement and proxy card for the Annual Meeting accompany this notice. The Annual Meeting is for the purpose of considering and acting upon: 1. The election of two directors of the Company; and 2. The transaction of such other matters as may properly come before the Annual Meeting or any adjournments thereof. The Board of Directors is not aware of any other business to come before the Annual Meeting. Any action may be taken on any one of the foregoing pro- posals at the Annual Meeting on the date specified above or on any date or dates to which, by original or later adjournment, the Annual Meeting may be adjourned. Stockholders of record at the close of business on September 30, 1997 are the stockholders entitled to vote at the Annual Meeting and any adjournments thereof. You are requested to fill in and sign the accompanying proxy card which is solicited by the Board of Directors and to mail it promptly in the accompanying envelope. The proxy card will not be used if you attend and vote at the Annual Meeting in person. BY ORDER OF THE BOARD OF DIRECTORS /s/ Paula J. Bergstrom PAULA J. BERGSTROM SECRETARY Camden, Arkansas October 10, 1997 IMPORTANT: THE PROMPT RETURN OF PROXIES WILL SAVE THE COMPANY THE EXPENSE OF FURTHER REQUESTS FOR PROXIES IN ORDER TO ENSURE A QUORUM. THE ACCOMPANYING PROXY CARD IS ACCOMPANIED BY A SELF-ADDRESSED ENVELOPE FOR YOUR CONVENIENCE. NO POSTAGE IS REQUIRED IF MAILED IN THE UNITED STATES. PROXY STATEMENT OF HCB BANCSHARES, INC. 237 JACKSON STREET, S.W. CAMDEN, ARKANSAS 71701-3941 ANNUAL MEETING OF STOCKHOLDERS NOVEMBER 13, 1997 GENERAL This proxy statement is furnished in connection with the solicitation of proxies by the Board of Directors of HCB Bancshares, Inc. (the "Company") to be used at the annual meeting of stockholders (the "Annual Meeting") which will be held at the Charles O. Ross Center, 746 California Avenue, S.W., Camden, Arkansas, on Thursday, November 13, 1997 at 10:00 a.m., local time. This proxy statement and the accompanying notice and proxy card are being first mailed to stockholders on or about October 15, 1997. VOTING AND REVOCABILITY OF PROXIES Stockholders who execute proxies retain the right to revoke them at any time. Unless so revoked, the shares represented by such proxies will be voted at the Annual Meeting and all adjournments thereof. Proxies may be revoked by written notice to Paula J. Bergstrom, Secretary of the Company, at the address shown above, by filing a later dated proxy prior to a vote being taken on a particular proposal at the Annual Meeting or by attending the Annual Meeting and voting in person. Proxies solicited by the Board of Directors of the Company will be voted in accordance with the directions given therein. WHERE NO INSTRUCTIONS ARE INDICATED, PROXIES WILL BE VOTED FOR THE NOMINEES FOR DIRECTORS SET FORTH IN THIS PROXY STATEMENT. The proxy confers discretionary authority on the persons named therein to vote with respect to the election of any person as a director where the nominee is unable to serve or for good cause will not serve, and matters incident to the conduct of the Annual Meeting. If any other business is presented at the Annual Meeting, proxies will be voted by those named therein in accordance with the determination of a majority of the Board of Directors. Proxies marked as abstentions, as well as shares held in street name which have been designated by brokers on proxy cards as not voted, will not be counted as votes cast. Proxies marked as abstentions or as broker non-votes, however, will be treated as shares present and eligible to vote for purposes of determining whether a quorum is present. VOTING SECURITIES AND BENEFICIAL OWNERSHIP Stockholders of record as of the close of business on September 30, 1997 (the "Record Date") are entitled to one vote for each share then held. At the Record Date, the Company had 2,645,000 shares of common stock, par value $.01 per share (the "Common Stock"), issued and outstanding. The presence, in person or by proxy, of at least one-third of the total number of shares of Common Stock outstanding and entitled to vote will be necessary to constitute a quorum at the Annual Meeting. -1- Persons and groups owning in excess of 5% of the Company's Common Stock are required to file certain reports regarding such ownership pursuant to the Securities Exchange Act of 1934, as amended (the "Exchange Act"). The following table sets forth, at the Record Date, certain information as to the Common Stock believed by management to be beneficially owned by persons owning in excess of 5% of the Company's Common Stock and by all directors and executive officers of the Company as a group.
Amount And Percent of Nature of Shares of Name And Address Beneficial Common Stock Of Beneficial Owner Ownership Outstanding - ------------------ ---------- ----------- HCB Bancshares, Inc. Employee Stock Ownership Plan ("ESOP") 237 Jackson Street, S.W. Camden, Arkansas 71701-0878 211,600 (1) 8.00% All directors and executive officers as a group (8 persons) 110,299 4.17% _________________ (1) Represents unallocated shares held in a suspense account for future allocation among participating employees as the loan used to purchase the shares is repaid. The ESOP trustee, First Commercial Trust Company, N.A., Little Rock, Arkansas, votes all allocated shares in accordance with instructions of the participants. Unallocated shares and shares for which no instructions have been received, if any, are voted by the ESOP trustee in the same ratio as participants direct the voting of allocated shares or, in the absence of such direction, in the ESOP trustee's best judgment.
ELECTION OF DIRECTORS GENERAL The Company's Board of Directors consists of seven members. The Company's Certificate of Incorporation requires that directors be divided into three classes, as nearly equal in number as possible, with approximately one-third of the directors elected each year. The Board of Directors has nominated Carl E. Parker, Jr. and Roy Wayne Moseley to serve as directors for a three-year period. All nominees currently are members of the Board. Under Oklahoma law, directors are elected by a plurality of all shares present and entitled to vote at a meeting at which a quorum is present. If any nominee is unable to serve, the shares represented by all valid proxies will be voted for the election of such substitute as the Board of Directors may recommend or the size of the Board may be reduced to eliminate the vacancy. At this time, the Board knows of no reason why any nominee might be unavailable to serve. The following table sets forth the names of the persons nominated by the Board of Directors for election as directors. Also set forth is certain other information with respect to each person's age, the year he or she first became a director of the Company's principal subsidiary, HEARTLAND Community Bank (the "Bank"), the expiration of his or her term as a director, and the number and percentage of shares of Common Stock beneficially owned. Each director of the Company is also a member of the Board of Directors of the Bank. -2-
Shares of Year First Common Stock Elected as Current Beneficially Age at Director of Term Owned at the Percent Name June 30, 1997 the Bank To Expire Record Date Of Class - ---------------------------------------------------------------------------------- BOARD NOMINEES FOR TERMS TO EXPIRE IN 2000 Carl E. Parker, Jr. 50 1981 1997 25,000 .95% Roy Wayne Moseley 61 1990 1997 9,877 .37 DIRECTORS CONTINUING IN OFFICE Vida H. Lampkin 59 1983 1998 25,000 .95 Clifford Steelman 56 1984 1998 25,000 .95 Cameron D. McKeel 58 1996 1999 9,500 .35 Bruce D. Murry 58 1994 1999 5,922 .23 Lula Sue Silliman 70 1962 1999 10,000 .37
Set forth below is information regarding the Company's directors. Unless otherwise stated, all directors have held the positions indicated for at least the past five years. CARL E. PARKER, JR. has been General Manager of Camden Monument Co. from 1970 to the present. He is a member of the Camden, Arkansas Rotary Club and Chamber of Commerce. ROY WAYNE MOSELEY has been the owner of Wayne's Greenhouse, a wholesale flower production business, in Fordyce, Arkansas since 1960. Mr. Moseley serves as the Fordyce, Arkansas Fire Chief. VIDA H. LAMPKIN has served as Chairman of the Board, President and Chief Executive Officer of the Company since December 1996 and has been the Chairman of the Board, President and Chief Executive Officer of the Bank since January 1990. Mrs. Lampkin also serves as the Chairman of the Board, President and Chief Executive Officer of the Bank's subsidiary savings bank. Mrs. Lampkin is currently a Board member of the Arkansas League of Savings Institutions, a member of the Arkansas Community of Excellence Committee for Camden, and is immediate past president of the Camden Chamber of Commerce. CLIFFORD STEELMAN has been employed by the Camden Kraft Packaging Plant, International Paper, Camden, Arkansas, since 1968. Mr. Steelman has served as Manager of Human Resources for the Camden Plant since 1978. He is currently serving on the Employers Advisory Committee for the Arkansas Employment Security Division and is a member of the Board of Directors of the Camden Fairview School District. CAMERON D. MCKEEL has served as Vice President of the Company since December 1996 and as Executive Vice President of the Bank since May 1996. Mr. McKeel also serves as a director of the Bank's subsidiary savings bank. Prior to joining the Bank, Mr. McKeel was Executive Vice President of Arkansas State Bank in Clarksville, Arkansas. -3- He has been secretary for the Clarksville Lions Club and is a member of First Baptist Church of Clarksville and Camden Noon Lions Club. BRUCE D. MURRY is owner of Bruce's, Inc., a retail establishment, located in Camden, Arkansas. He was president of the Camden Chamber of Commerce in 1995 and is a member of the Economic Development Task Force. LULA SUE SILLIMAN served as partner and office manager of the Silliman Insurance Agency, Inc. from 1949 until her retirement in 1970. COMMITTEES OF THE BOARD OF DIRECTORS The Board of Directors of the Company holds regular monthly meetings and special meetings as needed. During the year ended June 30, 1997, the Company's Board met seven times. No director attended fewer than 75% in the aggregate of the total number of Board and committee meetings held while he or she was a member during the year. The Company's Board of Directors performs the functions of an audit committee and met one time in this capacity with respect to the fiscal 1997 audit and independent auditors' report. The Compensation Committee consists of the non-employee directors, which for fiscal 1997 consisted of Messrs. Moseley, Murry and Parker, Ms. Silliman and Mr. Steelman. This committee reviews the performance of the officers of the Company and its subsidiaries and met one time with respect to compensation for fiscal 1997. The Company does not have a standing nominating committee. Under the Company's current Bylaws, the Company's full Board of Directors acts as the nominating committee. The Board of Directors met one time in this capacity with respect to the nominees for election as directors at the Annual Meeting. EXECUTIVE COMPENSATION The following table sets forth the cash and noncash compensation for each of the two fiscal years ended June 30, 1997 awarded to or earned by the Company's Chief Executive Officer, Vida H. Lampkin, for services rendered in all capacities to the Company and its subsidiaries.
Annual Compensation ------------------- All Other Year Salary Bonus Compensation(1) ---- ------ ----- --------------- 1997 $90,000 $ -- $18,060 1996 76,000 905 15,763 ________________ (1) For fiscal 1997, includes director fees ($9,600), life, health, dental and disability insurance ($5,238) and matching contribution to defined contribution plan ($3,222); does not include indirect compensation in the form of certain perquisites and other personal benefits which did not exceed 10% of salary and bonus.
DIRECTOR COMPENSATION Until January 1997, directors received fees of $600 per month. Since then, directors have received fees of $1,000 per month. This fee includes any committee meeting(s), as well as service on the board of directors of one or more subsidiaries of the Company. For fiscal 1997, directors' fees totaled $67,200. -4- Directors' Retirement Plan. The Bank's Board of Directors adopted a directors' retirement plan, effective June 13, 1996, for directors who are or were members of the Board of Directors at any time on or after the plan's effective date, provided that an employee who becomes a director after June 30, 1996 will not become a participant unless the Board of Directors adopts a specific resolution to that effect. On the effective date, (1) the account of each participant who was a director on the effective date (other than Directors Lampkin and McKeel) was credited with an amount of $1,900 for each full year of service as a director; (2) the account of Director Lampkin was credited with an amount projected to provide her with an annual retirement benefit, commencing at age 65 and continuing for her lifetime, in an amount equal to the difference between (i) 70% of her projected annual rate of pay at retirement, and (ii) the annuity value of her accrued benefits under the Bank's tax- qualified retirement plans plus her annual social security benefit at age 65; and (3) the account of Director McKeel was credited with an amount projected to provide him with an annual retirement benefit, commencing at age 65 and continuing for a period of ten years, in an amount equal to the difference between (i) 40% of his projected annual rate of pay at retirement, and (ii) the annuity value of his accrued benefits under the Bank's tax-qualified retirement plans plus his annual social security benefit at age 65. On the first day of each calendar month after the effective date, each participant who is a director on said date, with the exception of Directors Lampkin and McKeel, will have his or her account credited with an amount equal to the product of $158.33 and the Safe Performance Factor for the preceding fiscal year. The Safe Performance Factor is determined annually based on the Bank's return on equity, non-performing asset ratio, and regulatory composite rating for the year as compared to targets set for the fiscal year. In addition, each participant's account will be credited with a rate of return, on any vested amounts previously credited, equal to any appreciation or depreciation determined according to the participant's election. Amounts credited to the accounts of participants other than Directors Lampkin and McKeel will be fully vested at all times. The amounts credited to Director Lampkin and Director McKeel will become vested at the rate of 1.18% for each full month of service as a director, starting with 15% vested interest on January 1, 1996, and becoming fully vested after 72 or more months of service after January 1, 1996. Upon a non-employee director's termination of service on the Board due to death, disability, or mandatory retirement due to age restrictions, the director's account will be credited with an amount equal to the difference between $38,000 and the amount previously credited to her or his account, exclusive of investment returns. In the event of Director Lampkin's or Director McKeel's disability or death prior to her or his attainment of 50% vesting, the vested percentage on her or his account will be increased to 50%. If Director Lampkin's or Director McKeel's service on the Board is terminated for any reason other than "just cause" following a change in control, the vested percentage of her or his account will become 100%. Distribution of account balances will be made in cash, over a ten-year period, unless the participant elects to receive a lump sum or annual installments over a period of less than ten years. If a participant dies before receiving all benefits payable under the plan, distribution will be made to her or his beneficiary or, in the absence of a beneficiary, to her or his estate, in a lump sum, unless the participant has elected to have the distribution made in installments over a period of up to ten years. Benefits under the Directors' Plan are non- transferable. The Bank will pay all benefits in cash from its general assets, and has established a trust in order to hold assets with which to pay benefits. Trust assets will be subject to the claims of the Bank's general creditors. In the event a participant prevails over the Bank in a legal dispute as to the terms or interpretation of the Directors' Plan, he or she will be reimbursed for his or her legal and other expenses. EMPLOYMENT AGREEMENTS The Company and the Bank maintain separate employment agreements (the "Employment Agreements") with Vida H. Lampkin, President and Chief Executive Officer of the Bank and the Company (the "Employee"). In such capacities, the Employee is responsible for overseeing all operations of the Bank and the Company, and for implementing the policies adopted by the Board of Directors. Such Boards believe that the Employment Agreements assure fair treatment of the Employee in relation to her career with the Company and the Bank by assuring her of some financial security. -5- The Employment Agreements became effective on the date of their execution and provide for terms of three years and an annual base salary of $90,000. On each anniversary date of the Employment Agreements' effective date (the "Effective Date"), the term of employment will be extended for an additional one- year period beyond the then effective expiration date, upon a determination by the Board of Directors that the performance of the Employee has met the required performance standards and that such Employment Agreements should be extended. The Employment Agreements provide the Employee with a salary review by the Boards of Directors not less often than annually, as well as with inclusion in any discretionary bonus plans, retirement and medical plans, customary fringe benefits, vacation and sick leave. The Employment Agreements will terminate upon the Employee's death, may terminate upon the Employee's disability and are terminable by the Bank for "just cause" (as defined in the Employment Agreements). In the event of termination for "just cause," no severance benefits are available. In the event of (i) the Employee's involuntary termination of employment for any reason other than "just cause" or (ii) the Employee's voluntary termination within 90 days of the occurrence of a "good reason" (as defined in the Employment Agreements), the Employee will be entitled to receive (a) her salary up to the Employment Agreements' expiration date (the "Expiration Date") plus an additional 12-month salary, (b) a put option requiring the Bank or the Company to purchase Common Stock held by the Employee to the extent that it is not readily tradeable on an established securities market, and (c), at the Employee's election, either cash in an amount equal to the cost of benefits the Employee would have been eligible to participate in through the Expiration Date or continued participation in the benefits plans through the Expiration Date. If the Employment Agreements are terminated due to the Employee's "disability" (as defined in the Employment Agreements), the Employee will be entitled to a continuation of her salary and benefits through the date of such termination, including any period prior to the establishment of the Employee's disability. In the event of the Employee's death during the term of the Employment Agreements, her estate will be entitled to receive her salary through the last day of the calendar month in which the Employee's death occurred. The Employee is able to voluntarily terminate her Employment Agreements by providing 90 days' written notice to the Boards of Directors of the Bank and the Company, in which case the Employee is entitled to receive only her compensation, vested rights and benefits up to the date of termination. In the event of (i) a "change in control," or (ii) the Employee's termination for a reason other than just cause during the "protected period (as defined in the Employment Agreements)," the Employee will be paid within 10 days following the later to occur of such events an amount equal to the difference between (i) 2.99 times her "base amount," as defined in Section 280G(b)(3) of the Internal Revenue Code, and (ii) the sum of any other parachute payments, as defined under Section 280G(b)(2) of the Internal Revenue Code, that the Employee receives on account of the change in control. "Change in control" generally refers to (i) the acquisition, by any person or entity, of the ownership or power to vote more than 25% of the Bank's or Company's voting stock, (ii) the transfer by the Bank of substantially all of its assets to a corporation which is not an "affiliate" (as defined in the Employment Agreements), (iii) a sale by the Bank or the Company of substantially all the assets of an affiliate which accounts for 50% or more of the controlled group's assets immediately prior to such sale, (iv) the replacement of a majority of the existing board of directors by the Bank or the Company in connection with an initial public offering, tender offer, merger, exchange offer, business combination, sale of assets or contested election, or (v) a merger of the Bank or the Company which results in less than seventy percent (70%) of the outstanding voting securities of the resulting corporation being owned by former stockholders of the Company or the Bank. The Employment Agreements provide that within 10 business days of a change in control, the Bank shall fund, or cause to be funded, a trust in the amount of 2.99 times the Employee's base amount, that will be used to pay the Employee amounts owed to her. The aggregate payments that would be made to Mrs. Lampkin, assuming her termination of employment under the foregoing circumstances at June 30, 1997, would have been approximately $269,000. These provisions may have an anti- takeover effect by making it more expensive for a potential acquiror to obtain control of the Company. In the event that the Employee prevails over the Company and the Bank in a legal dispute as to the Employment Agreements, she will be reimbursed for her legal and other expenses. -6- TRANSACTIONS WITH MANAGEMENT The Bank offers loans to its directors, officers and employees. These loans currently are made in the ordinary course of business with the same collateral, interest rates and underwriting criteria as those of comparable transactions prevailing at the time and do not involve more than the normal risk of collectibility or present other unfavorable features. At June 30, 1997, the Bank's loans to directors and executive officers totaled approximately $83,210. COMPENSATION COMMITTEE REPORT ON EMPLOYEE COMPENSATION The Compensation Committee of the Board of Directors consists of the non-employee directors, which for fiscal 1997 consisted of Directors Moseley, Murry, Parker, Silliman and Steelman. This committee reviews the performance of the executive officers of the Company and its subsidiaries and recommends employee compensation structures and amounts to the Board. The Compensation Committee's compensation philosophy for all employees, including executive officers, is to provide competitive levels of compensation, integrate employees' pay with the achievement of the Company's performance goals, reward exceptional corporate performance, recognize individual initiative and achievement and assist the Company in attracting and retaining qualified employees. The committee expressly endorses the position that equity ownership by employees is beneficial in aligning employees' and stockholders' interests in the enhancement of stockholder value. Salaries are determined by evaluating the responsibilities of each position and by reference to the competitive marketplace for qualified employees, including with respect to executive officers comparisons of salaries for comparable positions at comparable companies within the banking industry. Annual salary changes are determined by evaluating changes in compensation in the marketplace, the performance of the company and the responsibilities and performance of the employee. For fiscal 1997, the base salaries of the chief executive officer and other executive officers were established in accordance with the foregoing policies. The chief executive officer's salary was not substantially changed for fiscal 1997, because it was raised in late fiscal 1996 based on a comparative survey of chief executive officer compensation levels. The salaries of the other executive officers also were not substantially changed for fiscal 1997, principally due to the fact that those officers' salaries were fully reviewed and analyzed when they joined the Bank late in fiscal 1996. Roy Wayne Moseley Bruce D. Murry Carl E. Parker, Jr. Lula Sue Silliman Clifford Steelman STOCK PERFORMANCE The cumulative total return of the Company's Common Stock from the commencement of trading on May 7, 1997 through June 30, 1997 (less than two months) was 2.0% compared with the cumulative total returns of the CRSP Index for the Nasdaq Stock Market (US Companies) of 9.2% and the CRSP Index for Nasdaq Stocks of savings institutions (US Companies) of 13.0% over the same period. Total cumulative return on the Common Stock or the index equals the total increase in value since May 7, 1997, assuming reinvestment of all dividends paid; total cumulative return on the Common Stock does not include the 26.2% increase in value on May 7, 1997 from the initial public offering price. -7- MISCELLANEOUS The cost of soliciting proxies will be borne by the Company. The Company will reimburse brokerage firms and other custodians, nominees and fiduciaries for reasonable expenses incurred by them in sending proxy materials to the beneficial owners of Common Stock. In addition to solicitations by mail, directors, officers and regular employees of the Company may solicit proxies personally or by telegraph or telephone without additional compensation. The Company's annual report to stockholders, including financial statements, is being mailed to all stockholders of record as of the close of business on the Record Date. Any stockholder who has not received a copy of such annual report may obtain a copy by writing to the Secretary of the Company. Such annual report is not to be treated as a part of the proxy solicitation materials or as having been incorporated herein by reference. Effective June 25, 1997, the Company, with the approval of the Board of Directors, dismissed Gaunt & Co. and engaged Miller, England & Company, Little Rock, Arkansas, as the Company's independent certified public accountants. In connection with their audits of the two most recent fiscal years ended June 30, 1995 and 1996, Gaunt & Co.'s reports on the financial statements of the Company did not contain any adverse opinion or disclaimer of opinion, nor were they qualified or modified as to uncertainty, audit scope or accounting principles. During the two most recent fiscal years and the subsequent interim period preceding the dismissal, there were not any disagreements between the Company and Gaunt & Co. on any matter of accounting principles or practices, financial statement disclosure or auditing scope or procedure which, if not resolved to the satisfaction of Gaunt & Co., would have caused it to make reference to the subject matter of such disagreement in connection with its report. The Board of Directors has ratified the appointment of Miller, England & Company to be the Company's independent certified public accountants for the fiscal year ending June 30, 1998. A representative of Miller, England & Company is expected to be present at the Meeting to respond to appropriate questions and to make a statement, if so desired. STOCKHOLDER PROPOSALS In order to be eligible for inclusion in the Company's proxy materials for next year's Annual Meeting of Stockholders, any stockholder proposal to take action at such meeting must be received at the Company's main office at 237 Jackson Street, S.W., Camden, Arkansas 71701-3941, no later than June 17, 1998. Any such proposal would be subject to the requirements of applicable law, including the proxy rules adopted under the Exchange Act. BY ORDER OF THE BOARD OF DIRECTORS /s/ Paula J. Bergstrom PAULA J. BERGSTROM SECRETARY Camden, Arkansas October 10, 1997 FORM 10-K A COPY OF THE COMPANY'S ANNUAL REPORT ON FORM 10-K FOR THE FISCAL YEAR ENDED JUNE 30, 1997 AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION WILL BE FURNISHED WITHOUT CHARGE TO EACH STOCKHOLDER AS OF THE RECORD DATE UPON WRITTEN REQUEST TO THE SECRETARY, HCB BANCSHARES, INC., 237 JACKSON STREET, S.W., CAMDEN, ARKANSAS 71701-3941. -8- [X] PLEASE MARK VOTES REVOCABLE PROXY AS IN THIS EXAMPLE HCB BANCSHARES, INC. ANNUAL MEETING OF STOCKHOLDERS NOVEMBER 13, 1997 The undersigned hereby appoints Vida H. Lampkin and Clifford Steelman, with full powers of substitution, to act as proxies for the undersigned, to vote all shares of common stock of HCB Bancshares, Inc. (the "Company") which the undersigned is entitled to vote at the Annual Meeting of Stockholders (the "Meeting"), to be held at the Charles O. Ross Center, 746 California Avenue, S.W., Camden, Arkansas, on Thursday, November 13, 1997 at 10:00 a.m., local time, and at any and all adjournments thereof, as follows:
WITH- FOR HOLD EXCEPT 1. The election as directors of all nominees listed (except as marked to the contrary below): [ ] [ ] [ ] Roy Wayne Moseley Carl E. Parker, Jr.
INSTRUCTION: TO WITHHOLD AUTHORITY TO VOTE FOR ANY INDIVIDUAL NOMINEE, MARK "EXCEPT" AND WRITE THAT NOMINEE'S NAME IN THE SPACE PROVIDED BELOW. ___________________________________________ THE BOARD OF DIRECTORS RECOMMENDS A VOTE "FOR" THE LISTED PROPOSITION. THIS PROXY WILL BE VOTED AS DIRECTED, BUT IF NO INSTRUCTIONS ARE SPECIFIED, THIS PROXY WILL BE VOTED FOR THE PROPOSITION STATED. IF ANY OTHER BUSINESS IS PRESENTED AT THE ANNUAL MEETING, THIS PROXY WILL BE VOTED BY THOSE NAMED IN THIS PROXY IN ACCORDANCE WITH THE DETERMINATION OF THE BOARD OF DIRECTORS. AT THE PRESENT TIME, THE BOARD OF DIRECTORS KNOWS OF NO OTHER BUSINESS TO BE PRESENTED AT THE ANNUAL MEETING. THIS PROXY CONFERS DISCRETIONARY AUTHORITY ON THE HOLDERS THEREOF TO VOTE WITH RESPECT TO THE ELECTION OF ANY PERSON AS DIRECTOR WHERE THE NOMINEE IS UNABLE TO SERVE OR FOR GOOD CAUSE WILL NOT SERVE AND MATTERS INCIDENT TO THE CONDUCT OF THE ANNUAL MEETING. THIS PROXY IS SOLICITED BY THE BOARD OF DIRECTORS. ____________________________ Please be sure to sign and date | | this proxy in the box below | Date | ___________________________________|____________________________| | | | | | Stockholders sign above Co-holder (if any) sign above | |________________________________________________________________| - --------------------------------------perforation----------------------------- _____________________________________________________________________________ | DETACH ABOVE CARD, SIGN, DATE AND MAIL IN POSTAGE-PAID ENVELOPE PROVIDED | | HCB BANCSHARES, INC. | |____________________________________________________________________________| Should the undersigned be present and elect to vote at the annual meeting or at any adjournment thereof and after notification to the Secretary of the Company at the annual meeting of the stockholder's decision to terminate this proxy, then the power of said attorneys and proxies shall be deemed terminated and of no further force and effect. The undersigned acknowledges receipt from the Company prior to the execution of this proxy of notice of the annual meeting, a proxy statement dated October 10, 1997 and an annual report to stockholders. Please sign exactly as your name appears on this proxy card. When signing as attorney, executor, administrator, trustee or guardian, please give your full title. If shares are held jointly, each holder should sign. PLEASE ACT PROMPTLY SIGN, DATE AND MAIL YOUR PROXY TODAY -----END PRIVACY-ENHANCED MESSAGE-----