SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the Securities Exchange Act of
1934
(Amendment No. )
Filed by the Registrant <checked-box>
Filed by a party other than the Registrant <square>
Check the appropriate box:
<square> Preliminary Proxy Statement
<square> Confidential, for Use of the Commission Only (as permitted by
Rule 14a-6(e)(2))
<checked-box> Definitive Proxy Statement
<square> Definitive Additional Materials
<square> Soliciting Material Pursuant to <square> <section>240.14a-11(c)
or <square> <section>240.14a-12
HUMBOLDT BANCORP
(Name of Registrant as Specified In Its Charter)
_________________________________________________________________
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
<checked-box> No fee required
<square> 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:________________________________________
<square> Fee paid previously with preliminary materials.
<square> 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:____________________________________________
<PAGE>1
HUMBOLDT BANCORP
701 Fifth Street
Eureka, California 95501
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
April 16, 1997
TO THE SHAREHOLDERS OF HUMBOLDT BANCORP:
The 1997 Annual Meeting of Shareholders of Humboldt Bancorp ("Humboldt")
will be held at Humboldt Bank, 701 Fifth Street, Eureka, California 95501 at
5:00 p.m. on Wednesday, April 16, 1997, for the following purposes:
1. ELECTION OF DIRECTORS. To elect a Board of eleven Directors to serve
for the ensuing year.
2. RATIFICATION OF INDEPENDENT AUDITORS. To ratify the appointment of
Richardson and Company as independent certified accountants to audit
Humboldt's financial statements for the fiscal year ending December
31, 1997.
3. OTHER BUSINESS. To consider and act upon such other business as may
properly come before the meeting or any adjournment thereof.
Only holders of Common Stock of record as of the close of business on
February 28, 1997 will be entitled to vote at the meeting or any adjournment
thereof.
By Order of the Board of Directors,
Alan J. Smyth
Corporate Secretary
March 14, 1997
YOU ARE URGED TO VOTE IN FAVOR OF MANAGEMENT'S PROPOSALS BY SIGNING AND
RETURNING THE ENCLOSED PROXY AS PROMPTLY AS POSSIBLE, WHETHER OR NOT YOU PLAN
TO ATTEND THE MEETING IN PERSON. THE ENCLOSED PROXY IS SOLICITED BY
HUMBOLDT'S BOARD OF DIRECTORS. ANY SHAREHOLDER GIVING A PROXY MAY REVOKE IT
PRIOR TO THE TIME IT IS VOTED BY NOTIFYING THE SECRETARY OF HUMBOLDT IN
WRITING OF SUCH REVOCATION, BY FILING A DULY-EXECUTED PROXY BEARING A LATER
DATE, OR BY ATTENDING THE ANNUAL MEETING IN PERSON AND VOTING BY BALLOT.
<PAGE>2
HUMBOLDT BANCORP
701 Fifth Street
Eureka, California 95501
PROXY STATEMENT
FOR
ANNUAL MEETING OF SHAREHOLDERS
APRIL 16, 1997
INTRODUCTION
This Proxy Statement is furnished in connection with the solicitation of
Proxies for use at the 1997 Annual Meeting of Shareholders (the "Annual
Meeting") of Humboldt Bancorp ("Humboldt", and with its subsidiaries the
"Company") to be held on Wednesday, April 16, 1997 at 5:00 p.m. at 701 Fifth
Street, Eureka, California, and at any and all adjournments thereof.
It is anticipated that this Proxy Statement and the accompanying Notice
and form of Proxy will be mailed to shareholders eligible to receive notice of
and to vote at the Annual Meeting on or about March 14, 1997.
REVOCABILITY OF PROXIES
A form of Proxy for voting your shares at the Annual Meeting is enclosed.
Any shareholder who executes and delivers such Proxy has the right to, and
may, revoke it at any time before it is exercised, by filing with the
Secretary of Humboldt an instrument revoking it or a duly executed Proxy
bearing a later date. In addition, if the person executing a Proxy is present
at the Annual Meeting, and elects to vote in person, the powers of the Proxy
holders will be superseded as to those Proposals on which the shareholder
actually votes at the Annual Meeting.
PERSONS MAKING THE SOLICITATION
THIS SOLICITATION OF PROXIES IS BEING MADE BY HUMBOLDT'S BOARD OF
DIRECTORS. The expenses of preparing, assembling, printing, and mailing this
Proxy Statement and the materials used in the solicitation of Proxies for the
Annual Meeting will be borne by the Company. It is contemplated that Proxies
will be solicited principally through the use of the mails, but officers,
directors, and employees of the Company and its subsidiaries may solicit
Proxies personally or by telephone, without receiving special compensation
therefor. The Company will reimburse banks, brokerage houses and other
custodians, nominees, and fiduciaries for their reasonable expenses in
forwarding these Proxy materials to shareholders whose stock in Humboldt is
held of record by such entities. In addition, the Company may use the
services of individuals or companies it does not regularly employ in
connection with this solicitation of Proxies if management determines it to be
advisable.
VOTING SECURITIES
There were issued and outstanding 1,410,767 shares of Humboldt's common
stock (the "Common Stock") as of February 28, 1997, which date has been fixed
as the record date for the purpose of determining shareholders entitled to
notice of, and to vote at, the Annual Meeting (the "Record Date").
<PAGE>3
All properly executed proxies delivered pursuant to this solicitation and
not revoked will be voted at the Annual Meeting in accordance with the
directions given. Regarding the election of directors, shareholders may vote
in favor of all nominees, or withhold their votes as to all nominees, or
withhold their votes as to specific nominees, by following the instructions on
the enclosed proxy card. With respect to the appointment of Richardson and
Company to serve as the Company's independent auditors for the 1997 fiscal
year, shareholders may vote in favor of or against the proposal, or may
abstain from voting, by specifying their choice as indicated on the enclosed
proxy card. If no specific instructions are given with respect to any matter
to be voted on, the shares represented by a signed proxy will be voted FOR the
election of the Board's nominees, and FOR the appointment of Richardson and
Company as independent auditors. Directors will be elected from nominees
receiving the highest number of affirmative votes cast by the holders of
Humboldt's Common Stock, voting in person or by proxy at the Annual Meeting;
ratification of the appointment of Richardson and Company as independent
auditors will require the affirmative vote of the holders of a majority of the
shares of Common Stock of Humboldt voting on such appointment in person or by
proxy at the Annual Meeting. Thus abstentions, because they will be counted
in determining whether a quorum is present for the vote on both matters, will
have no effect for the election of directors, but will have the effect of a no
vote for the ratification of Richardson and Company as the independent
accountants. Similarly, broker non-votes are also counted towards a quorum
but are not counted for any purpose in determining whether a matter has been
approved, and will have the same effect as an abstention.
On any matter submitted to the vote of the shareholders other than the
election of directors, each holder of Common Stock will be entitled to one
vote, in person or by Proxy, for each share of Common Stock held of record on
Humboldt's books as of the Record Date. In connection with the election of
directors, shares may be voted cumulatively, but only for persons whose names
have been placed in nomination prior to the voting for election of directors
and only if the shareholder holding such shares has given notice at the
Meeting, prior to such voting, of his or her intention to vote cumulatively.
(Notice of intention to vote cumulatively may not be given by simply marking
and returning a proxy.) If any Company shareholder gives such notice, then
all shareholders eligible to vote will be entitled to cumulate their votes in
voting for election of directors. Cumulative voting allows a shareholder to
cast a number of votes equal to the number of shares held in his or her name
as of the Record Date, multiplied by the number of directors to be elected.
All of these votes may be cast for any one nominee, or they may be distributed
among as many nominees as the shareholder sees fit. The nominees receiving
the highest number of affirmative votes, up to the number of directors to be
elected, shall be elected.
If one of Humboldt's shareholders gives notice of intention to vote
cumulatively, the persons holding the proxies solicited by the Board of
Directors will exercise their cumulative voting rights, at their discretion,
to vote the shares they hold in such a way as to ensure the election of as
many of the Board's nominees as they deem possible. This discretion and
authority of the proxy holders may be withheld by checking the box on the
proxy card marked "withhold from all nominees". Such an instruction, however,
will also deny the proxyholders the authority to vote for any or all of the
nominees of the Board of Directors, even if cumulative voting is not called
for at the Annual Meeting, although it will not prevent the proxyholders from
voting, at their discretion, for any other person whose name may be properly
placed in nomination at the Annual Meeting.
A shareholder may choose to withhold from the proxyholders the authority
to vote for any of the individual candidates nominated by the Board of
Directors by marking the appropriate box on the proxy card and striking out
the names of the disfavored candidates as they appear on the proxy card. In
that event the proxyholders will not cast any of the shareholder's votes for
candidates whose names have been crossed out, whether or not cumulative voting
is called for at the Annual Meeting, but they will retain the authority to
vote for the candidates nominated by the Board of Directors whose names have
not been struck out, and for any other candidates who may be properly
nominated at the Annual Meeting. If a shareholder wishes to specify the
manner in which his or her votes are allocated in the event of cumulative
voting, he or she must appear and vote in person at the Annual Meeting.
Ballots will be available at the Annual Meeting for persons desiring to vote
in person.
All votes will be tabulated by the Secretary of Humboldt Bancorp and/or
his assistant.
<PAGE>4
SHAREHOLDINGS OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
SECURITIES OWNERSHIP OF CERTAIN BENEFICIAL OWNERS
Management of the Company knows of no person who owns, beneficially or of
record, either individually or together with associates, more than five
percent of the outstanding shares of Humboldt's Common Stock, except as set
forth in the table below. Unless otherwise indicated, the persons listed have
sole voting and investment power over the shares beneficially owned.
SECURITIES OWNERSHIP OF MANAGEMENT
The following table sets forth, as of February 28, 1997, the number and
percentage of shares of Humboldt's outstanding Common Stock, which are
beneficially owned, directly or indirectly, by (a) each of Humboldt's
directors and nominees for director; (b) the Chief Executive Officer of
Humboldt and each of the Company's three executive officers other than the
Chief Executive Officer (the "named executive officers"); and (c) Humboldt's
directors and the named executive officers as a group. *The Company
identifies as its executive officers the Chief Executive Officer, the Chief
Financial Officer, the Senior Loan Officer and the Chief Administrative
Officer of Humboldt who have a significant impact on the overall direction of
financial reporting of the Company. The shares "beneficially owned" are
determined under Securities and Exchange Commission Rules, and do not
necessarily indicate ownership for any other purpose. In general, beneficial
ownership includes shares over which the indicated person has sole or shared
voting or investment power and shares which he has the right to acquire within
60 days of December 31, 1996. Unless otherwise indicated, the persons listed
have sole voting and investment power over the shares beneficially owned.
Management is not aware of any arrangements which may, at a subsequent date,
result in a change of control of the Company.
<TABLE>
<CAPTION>
OPTIONS
SHARES EXERCISABLE
HELD BY 3/1/97 TOTAL %
<S> <C> <C> <C> <C>
Myron Abrahamsen 11949.00 8696.00 20645.00 1.46
Ronald F. Angell 14698.00 8568.00 23266.00 1.65
Marguerite Dalianes 6035.00 5511.00 11546.00 0.82
Francis A. Dutra 68264.00 10167.00 78431.00 5.56
Gary L. Evans 13048.00 12960.00 26008.00 1.84
Lawrence Francesconi 12928.00 8521.00 21449.00 1.52
Clayton R. Janssen 9695.00 4087.00 13782.00 0.98
John McBeth 24567.00 6304.00 30871.00 2.19
Michael Renner 5574.00 200.00 5774.00 0.41
John R. Winzler 20212.00 12960.00 33172.00 2.35
Theodore S. Mason 5264.00 53361.00 58625.00 4.16
Alan J. Smyth 0.00 25348.00 25348.00 1.80
Ronald V. Barkley 151.00 25348.00 25499.00 1.81
Paul A. Ziegler 0.00 4389.00 4389.00 0.31
TOTAL: 192385.00 186420.00 378805.00 26.85
a) Director Nominees 192234.00 131335.00 323569.00 22.94
b) Executive Officers 5415.00 108446.00 113861.00 8.07
c) Directors & Executive 192385.00 186420.00 378805.00 26.85
Officers
</TABLE>
<PAGE>5
PROPOSAL NO. 1: ELECTION OF DIRECTORS
NOMINEES
Humboldt's directors are elected annually, to serve until the next Annual
Meeting of shareholders and until their respective successors have been
elected. All of the nominees listed below have served as directors since
Humboldt's last Annual Meeting of Shareholders, which was held in April of
1996, with the exception of Michael Renner who was appointed to the Board in
December 1996.
Humboldt's Bylaws provide that the number of directors of Humboldt may
not be less than eight (8) nor more than fifteen (15) until changed by an
amendment to the Bylaws adopted by Humboldt's shareholders, with the exact
number of directors within that range to be set by vote of the Board. At
present, Humboldt's Board consists of eleven (11) directors, and consequently
proxies may be voted for eleven directors.
The persons named below will be nominated for election as directors at
the Annual Meeting to serve until the 1998 Annual Meeting of Shareholders and
until their successors are duly elected. Unless otherwise instructed, proxy
holders will vote the proxies received by them for the election of the
nominees below (or as many thereof as possible under the rules of cumulative
voting). In the event that any of the nominees should be unable to serve as a
director, it is intended that the Proxy will be voted for the election of such
substitute nominee, if any, as shall be designated by the Board of Directors.
The Board of Directors has no reason to believe that any of the nominees named
below will be unable to serve if elected. Additional nominations for director
may only be made by complying with the nomination procedures which are
described under the heading "Shareholder Proposals and Nominations" at the end
of this Proxy Statement.
The nominees for Director as proposed by management, their ages and their
principal occupations during the past five years are:
<circle> MYRON ABRAHAMSEN, 75, Retired Insurance Agent and Broker formerly
with George Petersen and Associates. Board member since 1989.
<circle> RONALD F. ANGELL, 54, Attorney and Partner with the firm of
Roberts, Hill, Calligan, Bragg, Feeney & Angell. Board member since
1989.
<circle> MARGUERITE DALIANES, 53, President of Dalianes Travel Service.
Board member since 1992.
<circle> FRANCIS A. DUTRA, 66, Retired President of Dutra Trucking Company.
Board member since 1989.
<circle> GARY L. EVANS, 54, Certified Public Accountant associated with the
firm of Aalfs, Evans & Company. Board member since 1989.
<circle> LAWRENCE FRANCESCONI, 66, Retired Owner of Redwood Bootery. Board
member since 1991.
<circle> CLAYTON R. JANSSEN, 71, Attorney and Partner with the firm of
Janssen, Malloy, Marchi, Needham & Morrison. Board member since
1993.
<circle> THEODORE S. MASON, 54, President and Chief Executive Officer of
Humboldt Bank since March 1989. Prior to 1989 Mr. Mason was
Manager of the Eureka Main Office of Bank of America for
approximately five years. Board member since 1989.
<circle> JOHN MCBETH, 50, President of O & M Industries. Board member since
1992.
<circle> MICHAEL RENNER, 44, President of Renner Petroleum. Board member
since 1996.
<circle> JOHN R. WINZLER, 66, Consulting Engineer and President of Winzler &
Kelly. Board member since 1989.
The term of office of each director of Humboldt is one year. None of the
directors were selected pursuant to any arrangement or understanding other
than with the directors and officers of Humboldt acting within their
capacities as such. There are no family relationships between any of the
directors and executive officers of Humboldt. No director or officer of
Humboldt serves as a director of any company which has a class of securities
registered under, or which is subject to the periodic reporting requirements
of, the Securities Exchange Act of 1934, or of any company registered as an
investment company under the Investment Company Act of 1940.
<PAGE>6
VOTE REQUIRED FOR THE ELECTION OF DIRECTORS
Directors will be elected from the nominees receiving the highest number
of affirmative votes of the shares of Common Stock present and voting at the
Annual Meeting. Each share of Common Stock which is represented, in person or
by proxy, at the Annual Meeting will be accorded one vote on each nominee for
director, unless one or more shareholders express an intention to exercise the
right of cumulative voting, in which case all shares will be accorded the
cumulative voting rights described under the caption "Voting Securities",
above.
The Board of Directors recommends a vote FOR each of the nominees for
director described above.
COMMITTEES AND MEETINGS OF THE BOARD OF DIRECTORS
The Board of Directors of Humboldt held 12 regular and 6 special meetings
in 1996. All directors attended 75% or more of the aggregate number of the
Board of Directors and committee meetings on which each director served.
The Board of Directors of Humboldt has the following committees:
Asset/Liability & Investment Committee, Audit & Capital Plan Committee, Loan
Committee, Personnel Committee, Premises Committee and Special Activities
Committee.
The Asset/Liability and Investment Committee was composed of Francis A.
Dutra (Chairman), Clayton R. Janssen, Larry Francesconi, Theodore S. Mason,
Michael Renner, Alan J. Smyth and Ronald V. Barkley. The Committee met four
times during 1996. As part of its responsibilities, the Asset/Liability and
Investment Committee establishes philosophy and policy regarding the
productive employment of excess funds and reserves in prudent investments
consistent with liquidity requirements and regulatory prohibitions and reviews
liquidity, capital, interest, market and credit risks to produce consistent,
high quality earnings.
The Audit & Capital Plan Committee was composed of Gary L. Evans
(Chairman), Myron T. Abrahamsen and Marguerite Dalianes with Theodore S. Mason
and Ronald V. Barkley as non-voting members. The Committee met five times in
1996 for the purpose of reviewing overall operations of the Bank. As part of
its responsibilities, the Audit & Capital Plan Committee provides assistance
to the Directors in fulfilling their responsibility to the shareholders,
potential shareholders and the investment community relating to corporate
accounting, reporting practices of the corporation, the quality and integrity
of the financial statements of the corporation, and the capital requirements
of the corporation.
The Loan Committee was composed of Gary L. Evans (Chairman), Ronald F.
Angell, John Winzler, John McBeth, Theodore S. Mason, Clayton R. Janssen and
Larry Francesconi with Myron Abrahamsen as an alternate. The Committee met 49
times in 1996. As part of its responsibilities, the Loan Committee
establishes loan policy, examines and approves loans, delegates lending
authority, makes periodic reviews of the Loan Portfolio, reviews declined
loans and reviews all classified loans or other identified loan problems.
The Personnel Committee was composed of Francis A. Dutra (Chairman),
Myron Abrahamsen, Marguerite Dalianes, Larry Francesconi, Theodore S. Mason
and John Winzler. The Committee met seven times in 1996. As part of its
responsibilities, the Personnel Committee administers the Stock Option Plan,
the E.S.O.P. Plan and makes recommendations to the Board of Directors on other
Personnel matters.
The Premises Committee was comprised of John Winzler (Chairman), Ronald
F. Angell, John McBeth, Marguerite Dalianes and Theodore S. Mason. The
Committee met once in 1996. As part of its responsibilities, the Premises
Committee reviews the premises requirements of the Bank and makes
recommendations on matters relative to premises to the Board of Directors.
The Special Activities Committee was comprised of Clayton R. Janssen,
Ronald F. Angell, Larry Francesconi, Gary L. Evans and Theodore S. Mason. The
Committee met four times in 1996. As part of its responsibilities, the
Special Activities Committee reviews and approves policies for the Merchant
BankCard Department, the Credit Issuing Department and any other Special
Activities assigned to it by the Board of Directors.
<PAGE>7
COMPENSATION OF DIRECTORS
Directors of Humboldt or its subsidiaries who are also employees of the
Company do not receive compensation for their service on such Boards of
Directors. During 1996, non-employee directors of Humboldt received a fee of
$400 per Board meeting attended, $200 per Board meeting not attended; Loan
Committee Board members received $150 per meeting attended; all other Board
committees received $100 per meeting attended.
EXECUTIVE OFFICERS
The following are the names of the executive officers of the Bank and
certain information concerning each of them:
NAME AND AGE BUSINESS EXPERIENCE
Theodore S. Mason, 54 President and Chief Executive Officer of the
Bank since its inception in 1989.
Alan J. Smyth, 63 Senior Vice President, Chief Financial Officer
and Board Secretary of the Bank since its
inception in 1989.
Ronald V. Barkley, 60 Senior Vice President and Loan Administrator of
the Bank since its inception in 1989.
Paul A. Ziegler, 37 Vice President and Chief Administrative Officer
of the Bank since 1994. Prior to that time he
was employed with U.S. Bank for five years as a
Senior Vice President and Area Manager.
<PAGE>8
EXECUTIVE COMPENSATION
The following table sets forth all cash and non-cash compensation
(including bonuses, other annual compensation, deferred compensation and
options granted) paid or accrued to the named executive officers as of
December 31, 1996, for services rendered to the Company during the periods
indicated.
<TABLE>
<CAPTION>
ANNUAL COMPENSATION LONG TERM COMPENSATION
OTHER
ANNUAL DEFERRED OPTIONS
NAME YEAR SALARY BONUS(2) COMP(3) COMP(4) GRANTED
<S> <C> <C> <C> <C> <C> <C>
Theodore S. Mason(1) 1996.00 $105,000 $70,906 $1,658 $100,000 2,000
Theodore S. Mason 1995.00 $105,000 $52,001 $1,464 $60,000 3,000
Theodore S. Mason 1994.00 $99,000 $18,803 $1,464 $60,004 1,000
Alan J. Smyth 1996.00 $70,000 $68,017 $2,331 $50,000 1,000
Alan J. Smyth 1995.00 $70,000 $55,410 $2,506 $31,668 500.00
Alan J. Smyth 1994.00 $66,333 $15,871 $1,776 $30,000 1,000
Ronald V. Barkley 1996.00 $70,000 $12,926 $2,250 $45,000 1,000
Ronald V. Barkley 1995.00 $70,000 $48,884 $1,750 $31,703 500.00
Ronald V. Barkley 1994.00 $66,333 $28,022 $1,282 $30,000 1,000
Paul A. Ziegler 1996.00 $70,000 $24,600 $631 -0- 1,000
Paul A. Ziegler 1995.00 $55,070 $14,015 $553 -0- 500.00
Paul A. Ziegler 1994.00 $52,500 $5,000 $506 -0- 2,800
</TABLE>
1. Humboldt Bank entered into an employment agreement with Mr. Mason on
May 1, 1989 whereby Mr. Mason agreed to serve as the Bank's
President and Chief Executive Officer, which Agreement on December
10, 1996 was extended a third time to January 1, 2001. Under the
terms of the Agreement, Mr. Mason is entitled to receive a base
salary of $125,000.00 per year and an incentive bonus based on a
percentage ranging from 4% to 2.5% of the Bank's pre-tax net
profits pursuant to an incentive bonus plan. During his term of
employment, Mr. Mason may be reimbursed for travel, meals,
entertainment expenses, service to charitable organizations, and
membership in certain committees and other organizations. In
addition, he is eligible for typical employee benefits such as paid
vacation, sick leave, medical insurance and the use of an
automobile owned by the Bank.
2. Includes amounts paid to Mr. Mason, Mr. Smyth, Mr. Barkley and Mr.
Ziegler pursuant to the Bank's Incentive Bonus Plan.
3. Includes amounts imputed to Mr. Mason, Mr. Smyth, Mr. Barkley and
Mr. Ziegler as income for tax purposes pursuant to the Bank's
automobile program and the Bank's life insurance program.
4. Includes amounts of salary of bonus deferred by Mr. Mason, Mr.
Smyth, Mr. Barkley and Mr. Ziegler pursuant to the Bank's Deferred
Compensation Plan. The amounts in this column are not included in
the Salary and Bonus columns.
<PAGE>9
STOCK OPTION PLAN
To attract and retain highly qualified personnel for the Bank, Bancorp
has adopted the Humboldt Bancorp Stock Option Plan ("Option Plan"). The
Option Plan provides for the granting of options for the issuance of up to
87,484 shares of Bancorp Common Stock. All key full-time salaried
employees, key full-time salaried officers, and directors (including
emeritus directors) who are not full-time salaried employees ("Eligible
Directors") of Bancorp are eligible to be granted options under the Option
Plan. Eligible Directors may only participate in the Option Plan pursuant
to a formula. The Board, or the Committee in the case of grants to
officers, is responsible for the operation of the Option Plan and has the
sole discretion, subject to the express terms of the Option Plan, to make
all determinations regarding (i) the selection of the eligible individuals,
except directors, who are to receive option grants under the Option Plan
and (ii) the terms and conditions of each option grant. Directors of
Bancorp who are not serving on the Committee and who are not full time
salaried employees are eligible to receive 1,000 Options upon joining the
Board and 1,000 Options upon completion of a full year of service on the
Board as of December 31st of each year.
The option price per share shall be determined by the Board, or
Committee, in its sole discretion and shall be specified in the agreement
relating to such option. The option price shall not be less than 100% of
the market value of the Common Stock on the date of grant. The Option Plan
automatically terminates 10 years after the date the Board approved the
Option Plan. However, the Option Plan can be terminated at any time by the
Board of Directors. During 1996, Messrs. Mason, Smyth, Barkley and Ziegler
received 2,000, 1,000, 1,000 and 1,000 options, respectively, under the
Option Plan.
OTHER STOCK OPTIONS
In addition, the Bank issued 300,644 shares under a Bank Stock Option
Plan. These options were assumed by the Bancorp.
INCENTIVE BONUS PLAN
The Bank has an Incentive Bonus Plan for its employees, officers, vice
presidents and higher ranking officers.
Under the Bonus Plan, the Bank is required to grant incentive bonuses
to the following employees in the following amounts based on the amount of
the Bank's annual pre-tax profits, less any gain on investment securities
sold, and plus any loss on investment securities sold: the President and
Chief Executive Officer-4% of the first $2,000,000, 3% of the next
$2,000,000 and 2.5% on amounts in excess of $4,000,000; the Senior Vice
President and Chief Financial Officer-2% of the first $2,000,000, 1.5% of
the next $2,000,000 and 0.5% on amounts in excess of $4,000,000; the Senior
Vice President and Senior Loan Officer-2% of the first $2,000,000, 1.5% of
the next $2,000,000 and 0.5% on amounts in excess of $4,000,000; and the
Vice President and Chief Administrative Officer-0.5%.
The Bank may also grant incentive bonuses to the other employees for
an amount not exceeding 6% of the Bank's pre-tax net profits upon the
recommendation of the Bank's President.
DEFINED CONTRIBUTION RETIREMENT PLAN
The Bank has a defined contribution retirement plan covering
substantially all of the Bank's employees. The Bank contributions to the
plan are made at the discretion of the Board of Directors in an amount not
to exceed the maximum amount deductible under the profit sharing plan rules
of the Internal Revenue Service. Employees may elect to have a portion of
their compensation contributed to the plan in conformity with the
requirements of Section 401(k) of the Internal Revenue Code.
<PAGE>10
DIRECTOR FEE PLAN
Bancorp has adopted the Humboldt Bank Director Fee Plan (the "Fee
Plan"). The Fee Plan provides for the issuance of up to 40,000 shares of
Bancorp Common Stock.
The Fee Plan permits each Bank director to elect to receive his/her
directors' fees in the form of Bancorp common stock, cash, or a combination
of Bancorp common stock and cash, and to elect to defer the receipt of any
of the foregoing until the end of his/her term as a Bank director
("deferral"). If deferral is elected, the amount of the director's fees
shall be credited to an account on behalf of the director; however, such
crediting shall constitute a mere promise on the part of the Bank and
Bancorp to pay/distribute on this account. The account is otherwise
unsecured, unfunded and subject to the general claims of creditors of the
Bank and Bancorp.
The following tables set forth the number of options granted to the
Company's executive officers during 1996 and the number and value of
unexercised options held by such executive officers as of the end of 1996.
OPTION GRANTS IN 1996
<TABLE>
<CAPTION>
POTENTIAL REALIZABLE
VALUE AT ASSUMED
ANNUAL RATES OF
% OF TOTAL STOCK PRICE
OPTIONS GRANTED EXERCISE APPRECIATION FOR
OPTIONS TO EMPLOYEES PRICE EXPIRATION OPTION TERM
NAME GRANTED IN 1996 PER SHARE DATE 5% 10%
<S> <C> <C> <C> <C> <C> <C>
Theodore S. Mason 2,000 17.39% $14.55 January 1, 2006 $18,300.00 $46,380.00
Alan J. Smyth 1,000 8.70% $14.55 January 1, 2006 $ 9,150.00 $23,190.00
Ronald V. Barkley 1,000 8.70% $14.55 January 1, 2006 $ 9,150.00 $23,190.00
Paul A. Ziegler 1,000 8.70% $14.55 January 1, 2006 $ 9,150.00 $23,190.00
</TABLE>
AGGREGATED OPTION EXERCISES IN 1996
<TABLE>
<CAPTION>
NUMBER OF VALUE OF
UNEXERCISED UNEXERCISED
SHARES OPTIONS AT YEAR-END IN-THE-MONEY
ACQUIRED ON VALUE (EXERCISABLE/ (EXERCISABLE/
NAME EXERCISE REALIZED UNEXERCISABLE) UNEXERCISABLE)
<S> <C> <C> <C> <C>
Theodore S. Mason -0- -0- 52,628 / 5,023 $444,359 / $65,426
Alan J. Smyth -0- -0- 24,981 / 1,907 $211,792 / $25,463
Ronald V. Barkley -0- -0- 24,981 / 1,907 $211,792 / $25,463
Paul A. Ziegler -0- -0- 2,964 / 2,884 $31,486 / $35,337
</TABLE>
The Bank pays the cost of premiums on life insurance policies insuring
all employees, including executive officers, in amounts approximating two
times their annual salaries. The policies are payable to the officers'
designated beneficiaries. A portion of the premium paid by the Bank is
imputed as income for tax purposes for the executive officers. Such
amounts are included in the cash compensation set forth in the executive
compensation table above.
<PAGE>11
SUPPLEMENTAL BENEFIT PLAN
Humboldt Bank has adopted Salary Continuation Plans which act as
supplemental benefit plans for senior management and certain other
personnel. The Policy authorizes Humboldt and its subsidiaries to enter
into individual agreements with selected officers, providing them certain
retirement benefits. The Plans are approved by Humboldt's Board of
Directors.
As authorized, the Company has entered into Salary Continuation
Agreements with Messrs. Mason, Smyth, Barkley, Ziegler and others. Each of
these agreements, which are similar in form, provide that upon retirement
the officer will receive, for a period of fifteen years (Mr. Smyth and Mr.
Barkley for ten years) after the date of his/her retirement, a specified
annual retirement payment, payable in equal monthly installments. In the
event that the officer dies after his or her retirement, but before the end
of the 15 year period (Mr. Smyth and Mr. Barkley for 10 years), the Company
will continue to make such payments to the officer's designated
beneficiary. If the officer should die prior to his/her retirement as
described above, his/her designated beneficiary will receive, for a period
of 15 years (Mr. Smyth and Mr. Barkley for 10 years), the same yearly
benefit, payable in equal monthly installments.
The agreements also provide that if any person or company acquires 25%
or more of Humboldt's outstanding shares, through a tender offer, merger,
or otherwise, or if Humboldt should sell substantially all of its assets to
another bank or corporation which is not a wholly-owned subsidiary, and
within two years thereafter the officer's employment by the Company is
terminated or his/her salary or authority is materially reduced, the
executive or officer will be entitled to receive an amount equal to the
currently vested portion of his/her annual retirement benefit.
COMPLIANCE WITH SECTION 16(a) OF THE EXCHANGE ACT
Section 16(a) of the Securities Exchange Act of 1934 requires
Humboldt's officers and directors, and persons who own more than 10% of a
registered class of Humboldt's equity securities, to file reports of
ownership on Form 3 and changes of ownership on Form 4 or Form 5 with the
Securities and Exchange Commission (the "SEC"). They are also required by
SEC rules to furnish Humboldt with copies of all Section 16(a) forms that
they file.
Based solely on its review of the copies of such forms received by
Humboldt, or written representations from certain reporting persons that no
Forms 5 were required for the officers, directors and ten-percent
stockholders, Humboldt believes that during 1996 its officers, directors
and ten-percent stockholders complied with all applicable Section 16(a)
filing requirements except for Mr. Renner who inadvertently filed his
initial Form 3 late.
CERTAIN TRANSACTIONS
Some of the Company's directors and executive officers and their
immediate families, as well as the companies with which they are associated
or of which they are customers, have had banking transactions with Humboldt
in the ordinary course of the Company's business. In addition, the Company
expects to have banking transactions with such persons in the future. In
management's opinion, all loans and commitments to lend included in such
transactions were made in compliance with applicable laws on substantially
the same terms, including interest rates and collateral, as those
prevailing for comparable transactions with other persons of similar
creditworthiness and, in the opinion of management, did not involve more
than a normal risk of collectibility or present other unfavorable features.
The Company has a strong policy regarding review of the adequacy and
fairness to the Company of loans to its directors and officers. The
outstanding balance under extensions of credit to directors and executive
officers of the Company and other companies with which such individuals are
associated was $3,177,241 as of December 31, 1996.
<PAGE>12
PROPOSAL NO. 2: RATIFICATION OF INDEPENDENT AUDITORS
Upon the recommendation of Humboldt's Audit Committee, consisting of
Chairman Gary Evans, Marguerite Dalianes and Myron T. Abrahamsen, the Board
of Directors has appointed Richardson and Company as the Company's
independent accountants to audit the consolidated financial statements of
Humboldt and its subsidiaries for the 1997 fiscal year.
Richardson and Company served as the Company's auditors for the fiscal
year ended December 31, 1996, and during the course of that fiscal year
they were also engaged by the Company to provide certain tax and consulting
services. The affirmative vote of a majority of the shares of Common Stock
present and voting at the Annual Meeting is required to ratify the
appointment.
The Board of Directors recommends a vote FOR Proposal No. 2,
Ratification of the Appointment of Richardson and Company as the Company's
independent auditors for the succeeding year. If the appointment is not
ratified, Humboldt's Board of Directors will select other independent
auditors. Representatives of Richardson and Company will be present at the
Annual Meeting to respond to appropriate questions from the shareholders
and will be given the opportunity to make a statement should they desire to
do so.
SHAREHOLDER PROPOSALS
Under certain circumstances, shareholders are entitled to present
proposals at shareholders' meetings, provided that the proposal is
submitted in a timely manner and in a form that complies with applicable
regulations. For any such shareholder proposal to be included in the proxy
statement to be prepared for next year's annual meeting, the shareholder
must submit the proposal prior to October 18, 1997 in a form that complies
with applicable regulations.
OTHER MATTERS
Management does not know of any matters to be presented at the Annual
Meeting other than those set forth above. However, if other matters come
before the Annual Meeting, it is the intention of the persons named in the
accompanying Proxy to vote the shares represented by the Proxy in
accordance with the judgment of the person or persons authorized to vote
the Proxy, and discretionary authority to do so is included in the Proxy.
/s/ ALAN J. SMYTH
Alan J. Smyth
Corporate Secretary
Dated: March 14, 1997
The Annual Report to Shareholders for the fiscal year ended December
31, 1996 is being mailed concurrently with this Proxy Statement to all
shareholders of record as of February 28, 1997.
A COPY OF HUMBOLDT'S MOST RECENT ANNUAL REPORT TO THE SECURITIES AND
EXCHANGE COMMISSION ON FORM 10-KSB WILL BE PROVIDED TO SHAREHOLDERS WITHOUT
CHARGE UPON WRITTEN REQUEST TO: CORPORATE SECRETARY, HUMBOLDT BANCORP,
P.O. BOX 1007, EUREKA, CALIFORNIA 95502-1007.
<PAGE>13
HUMBOLDT BANCORP
ANNUAL MEETING OF SHAREHOLDERS
APRIL 16, 1997
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
The undersigned appoint(s) Alan J. Smyth and Cindy Cabeceira, and each
of them, as proxies for the undersigned, with full power of substitution
and revocation, to represent and to vote, as designated below, all shares
of Common Stock of Humboldt Bancorp (the "Company") that the undersigned
would be entitled to vote if personally present, at the Annual Meeting of
Shareholders of the Company to be held at 701 Fifth Street, Eureka,
California, on April 16, 1997 at 5:00 p.m., local time, upon the following
items as set forth in the Notice of Annual Meeting and Proxy Statement, and
according to their discretion upon all other matters that may be properly
presented for action at the Annual Meeting, or any adjournment thereof.
The undersigned may revoke this Proxy at any time prior to its exercise.
IF ANY SHAREHOLDER GIVES PROPER NOTICE AT THE ANNUAL MEETING OF HIS/HER
INTENTION TO CUMULATE HIS/HER VOTES IN THE ELECTION OF DIRECTORS, THE PROXY
HOLDERS WILL HAVE THE FULL DISCRETION AND AUTHORITY TO VOTE CUMULATIVELY
AND TO ALLOCATE VOTES AMONG ANY OR ALL OF THE NOMINEES OF THE BOARD OF
DIRECTORS IN SUCH ORDER AS THEY MAY DETERMINE UNLESS THE SHAREHOLDER HAS
OTHERWISE INDICATED BY MARKING THE BOXES ON THE OTHER SIDE OF THIS CARD.
SEE THE "VOTING SECURITIES" SECTION OF THE PROXY STATEMENT FOR MORE
INFORMATION.
THIS PROXY, WHEN PROPERLY EXECUTED AND RETURNED TO THE COMPANY, WILL BE
VOTED IN THE MANNER DIRECTED ON THIS CARD. IN THE EVENT THAT NO SUCH
DIRECTION IS GIVEN HEREON AND THIS PROXY IS NOT SUBSEQUENTLY REVOKED OR
SUPERSEDED, THE PROXYHOLDERS NAMED ABOVE INTEND TO VOTE FOR THE ELECTION OF
EACH OF THE NOMINEES FOR DIRECTOR LISTED BELOW AND FOR EACH OF THE OTHER
PROPOSALS LISTED BELOW.
THE BOARD OF DIRECTORS OF THE COMPANY RECOMMENDS A VOTE FOR EACH OF THE
PROPOSALS LISTED ON THIS CARD.
_
PLEASE MARK YOUR VOTES AS INDICATED IN THIS EXAMPLE: /X/
1. Proposal to elect the following nominees to serve as directors, each
to hold office until the 1998 Annual Meeting of Shareholders or until
his/her successor has been duly elected and qualified:
Nominees: Ronald F. Angell, Myron T. Abrahamsen, Marguerite Dalianes,
Francis A. Dutra, Gary L. Evans, Lawrence Francesconi, Clayton R.
Janssen, Theodore S. Mason, John McBeth, Michael Renner and John R.
Winzler.
_ _
/_/ /_/
FOR ALL WITHHOLD FROM
NOMINEES ALL NOMINEES
(INSTRUCTION: To withhold authority to vote for any individual nominee,
strike a line through his/her name in the list above.)
2. Proposal to ratify the appointment of Richardson and Company as
independent auditors to audit Humboldt's financial statements for the
fiscal year ended December 31, 1997.
_ _ _
/_/ /_/ /_/
FOR AGAINST ABSTAIN
<PAGE>14
I/we ___ do ___ do not expect to attend this meeting.
TO ASSURE A QUORUM, YOU ARE URGED TO DATE, COMPLETE, AND SIGN THIS PROXY
AND MAIL IT PROMPTLY IN THE ENCLOSED ENVELOPE, WHICH REQUIRES NO ADDITIONAL
POSTAGE IF MAILED IN THE UNITED STATES.
Please sign exactly as your name(s) appear(s). When signing as attorney,
executor, administrator, trustee, officer, partner, or guardian, please
give full title. If more than one trustee, all should sign. WHETHER OR
NOT YOU INTEND TO ATTEND THE ANNUAL MEETING, PLEASE SIGN AND RETURN THIS
PROXY AS PROMPTLY AS POSSIBLE IN THE ENCLOSED ENVELOPE.
SHAREHOLDER(S):
__________________________________________________
(SIGNATURE)
__________________________________________________
(SIGNATURE)
DATE: ______________________________, 1997.
