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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 Date
of Report (Date of earliest event reported) May 18, 1999
HERITAGE BANCORP, INC.
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(Exact name of registrant as specified in its charter)
Delaware 0-29492 58-2356162
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(State or other Jurisdiction of (Commission (IRS Employer
incorporation or organization) File Number) Identification No.)
201 W. Main Street, Laurens, South Carolina 29360
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(Address of principal executive offices)
(864) 984-4581
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(Registrant's telephone number, including area code)
Not Applicable
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(Former name or former address, if changed since last report)
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ITEM 5. OTHER EVENTS.
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On May 18, 1999, the Board of Directors of Heritage Bancorp, Inc., a
Delaware corporation (the "Company"), declared a special cash distribution in
the amount of $4.00 per share to each shareholder of record on June 1, 1999 to
be payable on June 22, 1999. Management of the Company expects that at least
part of the distribution will be a non-taxable return of capital, although the
exact amount of the distribution that could be considered non-taxable cannot be
confirmed until the Company's operating results for the 1999 tax year have been
determined.
Shareholders are advised to consult with their personal tax advisors with
respect to their particular income tax situation. A copy of the press release
announcing the distribution is attached as Exhibit 99 hereto and incorporated
herein by reference.
ITEM 7. FINANCIAL STATEMENTS AND OTHER EXHIBITS.
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Exhibit 99 Press Release dated May 19, 1999.
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
Dated: May 21, 1999 By: /s/ J. Edward Wells
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J. Edward Wells
President and Chief Executive Officer
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EXHIBIT 99 PRESS RELEASE
NEWS RELEASE
FOR IMMEDIATE RELEASE Contact: J. Edward Wells
President and Chief
Executive Officer
(864) 984-4581
HERITAGE BANCORP, INC.
ANNOUNCES RETURN OF CAPITAL
Laurens, South Carolina, May 19, 1999 -- Heritage Bancorp, Inc. (Nasdaq:
HBSC) announced today that its Board of Directors has declared a special cash
distribution in the amount of $4.00 per share. The cash distribution will be
payable on June 22, 1999 to stockholders of record as of the close of business
on June 1, 1999. This distribution will be paid from general cash reserves;
therefore the Company will not liquidate investments or borrow funds for this
payment. Management of the Company expects that at least part of the
distribution will be a non-taxable return of capital, although the exact amount
of the distribution that could be considered non-taxable cannot be confirmed
until the Company's operating results for the 1999 tax year have been
determined. The amount of the special cash distribution that would be treated as
a return of capital will be treated as a reduction in the cost basis of each
share and will not be subject to income tax as a dividend to shareholders.
J. Edward Wells, President and Chief Executive Officer of Heritage
Bancorp, indicated that the Board of Directors declared the special cash
distribution in view of the strong capital position of the Company's subsidiary,
Heritage Federal Bank, and the difficulty of achieving a competitive return on
equity with the Company's current capital position.
Mr. Wells stated that, "We believe that the special cash distribution is
in the best interest of the Company and its shareholders. The special cash
distribution is reflective of the Board's commitment to enhance long-term
shareholder value."
The Company expects to record a one-time compensation expense during the
current quarter in connection with the pass-through of the special distribution
to recipients of awards under the Company's Management Recognition and
Development Plan. However, it is anticipated that the special distribution will
also result in a reduction of the Company's ongoing compensation expense with
respect to such awards as a result of adjustments to the value of unvested
shares subject to awards. In addition, it is expected that the trustees of
Heritage Federal's Employee Stock Ownership Plan will apply the special
distribution to regularly scheduled payments and a prepayment of principal on
the ESOP's debt obligation to the Company. This application of the special
distribution will also result in increased compensation expense for the current
quarter as additional shares are committed for allocation to ESOP
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participants. The aggregate amount of the additional compensation expense in
the third quarter is anticipated to be approximately $1.7 million.
