<PAGE> 1
SCHEDULE 14A
(RULE 14A-101)
INFORMATION REQUIRED IN PROXY STATEMENT
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:
<TABLE>
<S> <C>
[ ] Preliminary Proxy Statement [ ] Confidential, for Use of the Commission
Only (as permitted by Rule 14a-6(e)(2))
[X] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to Rule 14a-11(c) or Rule 14a-12
</TABLE>
Eagle Bancshares, Inc.
- --------------------------------------------------------------------------------
(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):
[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:
<PAGE> 2
EAGLE BANCSHARES, INC.
4419 COWAN ROAD
TUCKER, GEORGIA 30084
(770) 908-6690
July 22, 1999
DEAR FELLOW SHAREHOLDER:
You are cordially invited to attend the 1999 Annual Meeting of
Shareholders of Eagle Bancshares, Inc. (the "Company" or "Eagle"), which will be
held at the Marriott Century Center Hotel, 2000 Century Boulevard, Atlanta,
Georgia, on Thursday, August 26, 1999 at 10:30 a.m., local time (the "Annual
Meeting").
The following Proxy Statement outlines the business to be conducted at
the Annual Meeting, which includes proposals to elect two directors for a term
of three years and until their successors are elected and qualified, and to
ratify the appointment of Arthur Andersen LLP, as independent public
accountants.
Enclosed are the Notice of Meeting, Proxy Statement, form(s) of proxy
card and the 1999 Annual Report. WE HOPE YOU CAN ATTEND THE ANNUAL MEETING IN
PERSON. WHETHER OR NOT YOU PLAN TO ATTEND THE ANNUAL MEETING, IT IS IMPORTANT
FOR YOU TO COMPLETE THE ENCLOSED PROXY CARD(S) AND RETURN THE PROXY CARD(S) IN
THE ENCLOSED POSTAGE-PAID ENVELOPE AS PROMPTLY AS POSSIBLE.
If you have any questions about the Proxy Statement or the 1999 Annual
Report, please let us hear from you.
Sincerely,
C. Jere Sechler, Jr.
Chairman of the Board
<PAGE> 3
EAGLE BANCSHARES, INC.
4419 COWAN ROAD
TUCKER, GEORGIA 30084
NOTICE OF 1999 ANNUAL MEETING OF SHAREHOLDERS
TO BE HELD AUGUST 26, 1999
NOTICE HEREBY IS GIVEN that the 1999 Annual Meeting of Shareholders of
Eagle Bancshares, Inc. (the "Company" or "Eagle") will be held at the Marriott
Century Center Hotel, 2000 Century Boulevard, Atlanta, Georgia, on Thursday,
August 26, 1999, at 10:30 a.m., local time (the "Annual Meeting").
(1) To elect two directors to serve for a term of three years or until
their successors have been duly elected and qualified.
(2) To ratify the appointment of Arthur Andersen LLP, as independent
public accountants for the Company for the fiscal year ending March 31, 2000.
(3) Such other matters as properly may come before the Annual Meeting
or any adjournments thereof. The Board of Directors is not aware of any other
business to be presented for a vote of the shareholders at the Annual Meeting.
Information relating to the above matters is set forth in the attached
Proxy Statement. Shareholders of record at the close of business on July 8, 1999
will be entitled to receive notice of and to vote at the Annual Meeting and any
adjournments thereof.
By Order Of The Board of Directors.
Richard B. Inman, Jr.
Secretary
Tucker, Georgia
July 22, 1999
PLEASE READ THE ATTACHED PROXY STATEMENT AND THEN PROMPTLY COMPLETE, DATE, SIGN
AND RETURN THE ENCLOSED PROXY CARD IN THE ACCOMPANYING POSTAGE-PAID ENVELOPE. IF
YOU ATTEND THE ANNUAL MEETING AND SO DESIRE, YOU MAY REVOKE THE PROXY CARD AND
VOTE IN PERSON THOSE SHARES OF STOCK HELD BY YOU OTHER THAN SHARES OF COMMON
STOCK ALLOCATED TO AN ACCOUNT FOR YOU PURSUANT TO THE TUCKER FEDERAL SAVINGS &
LOAN ASSOCIATION EMPLOYEE STOCK OWNERSHIP PLAN.
<PAGE> 4
EAGLE BANCSHARES, INC.
4419 COWAN ROAD
TUCKER, GEORGIA 30084
PROXY STATEMENT
FOR THE ANNUAL MEETING OF SHAREHOLDERS
TO BE HELD AUGUST 26, 1999
This Proxy Statement is furnished to the shareholders of Eagle
Bancshares, Inc. (the "Company" or "Eagle") in connection with the solicitation
of proxies by the Board of Directors of the Company to be voted at the 1999
Annual Meeting of Shareholders of the Company and at any adjournments thereof
(the "Annual Meeting"). The Annual Meeting will be held at the Marriott Century
Center Hotel, 2000 Century Boulevard, Atlanta, Georgia, on Thursday, August 26,
1999, at 10:30 a.m., local time.
The approximate date on which this Proxy Statement and the accompanying
proxy card(s) are first being sent or given to shareholders is July 22, 1999.
All references to numbers of shares of Common Stock of the Company,
$1.00 par value per share (the "Common Stock"), contained in this Proxy
Statement have been adjusted as a result of a two-for-one stock split in the
form of a 100% stock dividend that occurred on December 21, 1995.
VOTING
GENERAL
The securities that can be voted at the Annual Meeting consist of
Common Stock of the Company, with each share entitling its owner to one vote on
each matter submitted to the shareholders. The record date for determining the
holders of Common Stock who are entitled to notice of and to vote at the Annual
Meeting is July 8, 1999. On the record date, 5,569,514 shares of Common Stock
were outstanding and eligible to be voted at the Annual Meeting.
QUORUM AND VOTE REQUIRED
The presence, in person or by proxy, of a majority of the outstanding
shares of Common Stock is necessary to constitute a quorum at the Annual
Meeting. In counting the votes to determine whether a quorum exists at the
Annual Meeting, the proposal receiving the greatest total number of votes cast
"for" or "against" and abstentions (including instructions to withhold authority
to vote) will be used.
In voting for the proposal to elect directors (Proposal 1),
shareholders may vote in favor of all nominees, withhold their votes as to all
nominees or withhold their votes as to specific nominees. The vote required to
approve Proposal 1 is governed by Georgia law and is a plurality of the votes
cast by the holders of shares entitled to vote, provided a quorum is present. As
a result, in accordance with Georgia law, votes that are withheld will not be
counted and will have no effect.
In voting for the proposal to ratify the Board of Directors'
appointment of independent accountants for the Company (Proposal 2),
shareholders may vote in favor of the proposal or against the proposal or may
abstain from voting. The vote required to approve Proposal 2 is governed by
Georgia law, and the votes cast favoring such proposal
<PAGE> 5
must exceed the votes cast opposing such proposal, provided a quorum is present.
As a result, in accordance with Georgia law, abstentions will not be counted and
will have no effect.
Under the rules of the New York Stock Exchange and the American Stock
Exchange (the "Exchanges") that govern most domestic stock brokerage firms,
member brokerage firms that hold shares in street name for beneficial owners
may, to the extent that such beneficial owners do not furnish voting
instructions with respect to any or all proposals submitted for shareholder
action, vote in their discretion upon proposals which are considered
discretionary" proposals under the rules of the Exchanges. Member brokerage
firms that have received no instructions from their clients as to
"non-discretionary" proposals do not have discretion to vote on these proposals.
Such "broker non-votes" will not be considered in determining whether a quorum
exists at the Annual Meeting and will not be considered as votes cast in
determining the outcome of any proposal.
HOLDERS OF COMMON STOCK
Proxy cards are being transmitted with this Proxy Statement to all
holders of Common Stock of the Company. All properly executed proxy cards
delivered by shareholders to the Company in time to be voted at the Annual
Meeting and not revoked will be voted at the Annual Meeting in accordance with
the directions given. Shareholders should specify their choices on the
accompanying proxy card(s). IF NO SPECIFIC INSTRUCTIONS ARE GIVEN WITH REGARD TO
THE MATTERS TO BE VOTED UPON, THE SHARES REPRESENTED BY A SIGNED PROXY CARD WILL
BE VOTED "FOR" THE NOMINEES FOR DIRECTOR IDENTIFIED ON PAGE 5 AND THE
RATIFICATION OF THE APPOINTMENT OF ARTHUR ANDERSEN LLP AS INDEPENDENT PUBLIC
ACCOUNTANTS FOR THE COMPANY FOR THE FISCAL YEAR ENDING MARCH 31, 2000. The Board
of Directors of the Company does not know of any other business to be brought
before the Annual Meeting, but it is intended that, if any other matters
properly come before the Annual Meeting, the persons named as proxies will vote
upon such matters according to their judgment. All proxy cards delivered
pursuant to this solicitation are revocable at any time before they are voted at
the option of the persons executing them by giving written notice to the
Secretary of the Company, by delivering a later dated proxy card or by voting in
person at the Annual Meeting.
PARTICIPANTS IN THE 401(K) SAVINGS AND EMPLOYEE STOCK OWNERSHIP PLAN
Separate proxy cards are being transmitted to all persons who have
shares of Common Stock allocated to their accounts as participants or
beneficiaries under the Tucker Federal Savings & Loan Association 401(k) Savings
and Employee Stock Ownership Plan (the "Plan"). These proxy cards appoint
Richard B. Inman, Jr., Zelma B. Martin and Charles Buckner, who act as Trustees
for the Plan, to vote the shares held for the accounts of the participants or
their beneficiaries in the Plan in accordance with the instructions noted
thereon. IN THE EVENT NO PROXY CARD IS RECEIVED FROM A PARTICIPANT OR
BENEFICIARY OR A PROXY CARD IS RECEIVED WITHOUT INSTRUCTIONS, OR IN THE EVENT
SHARES ARE NOT YET ALLOCATED TO ANY PARTICIPANT'S ACCOUNT, THE TRUSTEES WILL
VOTE THE SHARES OF STOCK OF THE PARTICIPANT AND ANY UNALLOCATED SHARES "FOR" THE
NOMINEES FOR DIRECTOR IDENTIFIED ON PAGE 5 AND THE RATIFICATION OF THE
APPOINTMENT OF ARTHUR ANDERSEN LLP AS INDEPENDENT PUBLIC ACCOUNTANTS FOR THE
COMPANY FOR THE FISCAL YEAR ENDING MARCH 31, 2000. The Trustees do not know of
any other business to be brought before the Annual Meeting but it is intended
that, if any other matters properly come before the Annual Meeting, the Trustees
as proxies will vote upon such matters according to their judgment.
Any Plan participant or beneficiary who executes and delivers a proxy
card to the Trustees may revoke it at any time prior to its use by executing and
delivering to the Trustees a duly executed proxy card bearing a later date or by
giving written notice to the Trustees at the following address: Tucker Federal
Savings & Loan Association 401(k) Savings and Employee Stock Ownership Plan,
2355 Main Street, Tucker, Georgia 30084. Under the terms of the Plan, only the
Trustees of the Plan can vote the shares allocated to the accounts of
participants, even if such participants or their beneficiaries attend the Annual
Meeting in person.
2
<PAGE> 6
COSTS OF SOLICITATION
In addition to soliciting proxies through the mail, the Company may
solicit proxies through its directors, officers and employees in person and by
telephone. Brokerage firms, nominees, custodians and fiduciaries also may be
requested to forward proxy materials to the beneficial owners of shares of
Common Stock held by them. All expenses incurred in connection with the
solicitation of proxies will be borne by the Company. The Company has engaged
the services of Corporate Investors Communications, Inc., a proxy solicitation
firm, to assist in soliciting proxies from beneficial owners of shares of the
Company's Common Stock held by banks, brokerage houses and other custodians,
nominees and fiduciaries. The Company anticipates that such assistance will cost
approximately $3,500, plus certain out-of-pocket expenses.
PRINCIPAL SHAREHOLDERS
The following table sets forth information as of March 31, 1999
regarding the ownership of the Company's Common Stock by each person known to
the Company to be the beneficial owner of more than 5% of the Company's Common
Stock and by all directors and executive officers of the Company as a group,
based on data furnished to the Company by such persons. Information regarding
the beneficial ownership of Common Stock by directors and director nominees is
included under "Proposal 1 - Election of Directors" and by executive officers
named in the Summary Compensation Table is included under "Executive Officers of
the Company."
<TABLE>
<CAPTION>
NUMBER OF
SHARES BENEFICIALLY
NAME AND ADDRESS OWNED(1) PERCENT OF CLASS
- ---------------- --------- ----------------
<S> <C> <C>
Dimensional Fund Advisors 297,050 (2) 5.33%
1299 Ocean Avenue, 11th Floor
Santa Monica, CA 90401
Tucker Federal Savings & 409,316 (3) 7.35%
Loan Association 401(k) Savings and
Employee Stock Ownership Plan
2355 Main Street
Tucker, Georgia 30084
All directors and 755,179 (4) 13.56%
executive officers
as a group (9 persons)
</TABLE>
- -------------------
(1) The stock ownership information shown above has been furnished to
the Company by the named persons and members of the group or obtained from
information filed with the Securities and Exchange Commission (the
"Commission"). Beneficial ownership of the Company's principal shareholders as
reported in this table has been determined in accordance with regulations of the
Commission and includes shares of Common Stock which may be acquired within 60
days. Except as otherwise indicated, the named persons and members of the group
have sole voting and investment power with regard to the shares shown as owned
by them.
3
<PAGE> 7
(2) Dimensional Fund Advisors Inc. ("Dimensional") a registered
investment advisor, is deemed to have beneficial ownership of 297,050 shares of
Eagle Bancshares, Inc stock as of March 31, 1999, all of which shares are held
in portfolios of DFA Investment Dimensions Group Inc., a registered open-end
investment company, or in series of the DFA Investment Trust Company, a Delaware
business trust, or the DFA Group Trust and DFA Participation Group Trust,
investment vehicles for qualified employee benefit plans, all of which
Dimensional Fund Advisors Inc. serves as investment manager. Dimensional
disclaims beneficial ownership of all such shares.
(3) The Plan is a tax qualified employee benefit plan covering eligible
employees of the Company and its subsidiaries, including Tucker Federal Bank
("Tucker Federal"), Eagle Service Corporation and Prime Eagle Mortgage
Corporation. Richard B. Inman, Jr., Zelma B. Martin and Charles Buckner are the
Trustees of the Plan. The Trustees may vote only unallocated shares and
allocated shares with respect to which the Trustees do not receive timely voting
instructions from participants or their beneficiaries. As of March 31, 1999,
322,455 shares held by the Plan were allocated to participants' accounts and
86,861 shares held by the Plan were unallocated. The Trustees disclaim
beneficial ownership of shares held by the Plan that are voted by participants.
(4) Includes 43,200 shares of Common Stock held by the Plan and
allocated to the accounts of the executive officers of the Company and 9,036
shares held of record by certain family members of the above-referenced group as
to which the respective members of the group disclaim beneficial ownership.
PROPOSAL 1 - ELECTION OF DIRECTORS
NOMINEES
The Bylaws of the Company provide that the Board of Directors shall
consist of seven members, and the Restated Articles of Incorporation of the
Company, as amended, provide that the directors shall be divided into three
classes as nearly equal in number as possible. Directors are elected by
shareholders for a term of three years and until their successors are elected
and qualified. The term of office of one of the classes of directors expires
each year, and a new class of directors is elected annually for a term of three
years at the Annual Meeting of Shareholders.
The Board of Directors, acting in its capacity as the Nominating
Committee, has nominated Walter C. Alford, and Richard B. Inman, Jr. to stand
for election as directors at the Annual Meeting. Mr.Alford has been a director
of the Company since 1995, and Mr. Inman was first elected a director of the
Company in 1992. If elected by the shareholders, the nominees will serve a three
year term until the 2002 Annual Meeting of Shareholders or until their
successors are duly elected and qualified. Information regarding the two
nominees is set forth below.
Each of the nominees has consented to serve if elected. If any of the
nominees should be unavailable for any reason (which is not anticipated), the
Board of Directors may designate a substitute nominee or nominees (in which case
the persons named as proxies on the enclosed proxy card(s) will vote all valid
proxy cards for the election of such substitute nominee or nominees), allow the
vacancy or vacancies to remain open until a suitable candidate or candidates are
located, or by resolution provide for a lesser number of directors.
THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS THAT SHAREHOLDERS VOTE
"FOR" THE PROPOSAL TO ELECT WALTER C. ALFORD, AND RICHARD B. INMAN, JR. AS
DIRECTORS OF THE COMPANY TO HOLD OFFICE FOR A TERM OF THREE YEARS AND UNTIL
THEIR SUCCESSORS ARE ELECTED AND QUALIFIED.
4
<PAGE> 8
INFORMATION REGARDING NOMINEES AND DIRECTORS
The following table sets forth certain information as of May 12, 1999
regarding the two nominees for director and all current directors whose terms of
office will continue after the Annual Meeting.
DIRECTORS NOMINATED FOR ELECTION TO SERVE UNTIL THE
2002 ANNUAL MEETING OF SHAREHOLDERS
<TABLE>
<CAPTION>
Shares
Beneficially
Owned
(Percent
Name Business Information of Class)(1)
---- -------------------- ------------
<S> <C> <C>
Walter C. Alford Mr. Alford has been an attorney practicing in Tucker, 30,786 (2)
Georgia since 1974 and has served as General Counsel (*)
to Tucker Federal since 1995. Mr. Alford, 49, has
been a director of the Company and Tucker Federal
since April 1995.
Richard B. Inman, Jr. Mr. Inman has served as President and Chief Executive 166,040 (3)
__________ Officer of Tucker Federal since October (2.98%)
1990 and as a ______ director of Tucker Federal
since 1988. Mr. Inman also has acted as Treasurer of
the Company since May 1993. From 1975 until October
1990, Mr. Inman was a commercial and investment
banker for Citibank, Merrill Lynch, White, Weld &
Co., Paine Webber and Wells Fargo, and owned and
operated two food companies. Mr. Inman is 47.
DIRECTORS TO SERVE UNTIL THE
2001 ANNUAL MEETING OF SHAREHOLDERS
<CAPTION>
Shares
Beneficially
Owned
(Percent)
Name Business Information of Class) (1)
---- -------------------- -------------
<S> <C> <C>
Weldon A. Nash, Jr. Mr. Nash has served as President and Chief Executive 81,910(4)
Officer of Weldon, Inc., a company based in Stone (1.47%)
Mountain, Georgia which designs, builds and develops
residential and commercial properties since January
1, 1975. Mr. Nash, 56, was first elected as a
director in March 1991.
C. Jere Sechler, Jr. Mr. Sechler was first elected as a director in April 1995 and 236,185(5)
was elected Chairman of the Board in May 1996. Mr. Sechler (4.24%)
was elected President of the Company in May 1996 and has
served as President of Eagle Service Corporation, a wholly
owned subsidiary of Tucker Federal since 1991 and as Chairman
of the Board of Eagle Real Estate Advisors, Inc., a wholly owned
subsidiary of the Company ("EREA"), since 1991. He has been
a director of Tucker Federal since 1985 and Chairman of the
</TABLE>
5
<PAGE> 9
<TABLE>
<S> <C> <C>
Board since May 1996. Mr. Sechler is 53.
William F. Waldrop, Jr. Mr. Waldrop was a partner in and the General Sales Manager 36,249(6)
for Elevator Specialists, Inc. in Atlanta, Georgia for 20 years (*)
until his retirement in 1996. He remains the Secretary Treasurer
and a Director of that Company. He is currently a partner in
Noel Shuman Homes, Inc., a home building company. He was
first elected a Director of Southern Crescent Financial Corporation
("SCFC") in 1990 and subsequently was elected to the Tucker Federal
Board in 1997 after the Company's acquisition of Southern Crescent
Financial Corp. He was elected a director of the Company in 1998.
Mr. Waldrop is 55.
DIRECTORS TO SERVE UNTIL THE
2000 ANNUAL MEETING OF SHAREHOLDERS
<CAPTION>
Shares
Beneficially
Owned
(Percent
Name Business Information of Class)(1)
- ---- -------------------- ------------
<S> <C> <C>
George G. Thompson, V. Mr. Thompson was the Superintendent of Gwinnett County 7748(7)
Public Schools from 1990 until December 1994. He is currently (*)
employed by The Center for Leadership in School Reform, a
non-profit corporation headquartered in Louisville, Kentucky
as a Vice President. Mr. Thompson is 53 and has served as
a director since 1993.
Richard J. Burrell Mr. Burrell retired in 1994 after 40 years of service with 43,895(8)
Household International, Inc., a financial services company (*)
where he served as Governmental Relations Director from
1962 until 1994. Mr. Burrell previously has served as president
of the Alabama and Florida Financial Services Associations and
the Georgia Equity Lenders Association. Mr. Burrell is currently
serving as a consultant to the Georgia Financial Services Association
and is a director of the Stone Mountain Memorial Association and
the Young Harris College Alumni Foundation. Mr. Burrell is 71
and was first elected as a director in 1994.
</TABLE>
- -----------------------------
* Less than one percent.
(1) The stock ownership information shown above has been furnished to
the Company by the named persons or obtained from information filed with the
Commission. Beneficial ownership as reported in this table has been determined
in accordance with regulations of the Commission and includes shares of Common
Stock, which may be acquired within 60 days. Except as otherwise indicated, the
named persons have sole voting and investment power with regard to the shares
shown as owned by them.
(2) With regard to Mr. Alford, the shares shown include (i) 1,704
shares held of record by his spouse and as to which he disclaims beneficial
ownership and (ii)3,500 shares which may be acquired by Mr. Alford upon the
exercise of stock options granted pursuant to the 1994 Eagle Bancshares, Inc.
Directors Stock Option Incentive Plan
6
<PAGE> 10
(the "DSOP"). Mr. Alford received legal fees from Tucker Federal in the amount
of $249,544 during the fiscal year ended March 31, 1999. The legal fees were
paid for services rendered by Mr. Alford's law firm on behalf of Tucker Federal
for matters involving litigation, title examinations, foreclosure proceedings
and the closing of loan transactions, including mortgage title insurance
premiums paid to the title insurance company. The fees paid were comparable to
fees that could have been obtained in arms-length negotiated transactions with
unaffiliated third parties. In addition, in May 1994, Mr. Alford was appointed
General Counsel to Tucker Federal and received a retainer from Tucker Federal in
the amount of $45,000 during the fiscal year. The portion of the retainer paid
for the fiscal year is included in the total amount paid to Mr. Alford above.
(3) With regard to Mr. Inman, the shares shown include (i) 24,500
shares which may be acquired by Mr. Inman upon the exercise of stock options
granted in accordance with Mr. Inman's 1993 employment agreements with Tucker
Federal and pursuant to the DSOP; (ii) 23,333 shares which may be acquired by
Mr. Inman upon the exercise of stock options granted in accordance with Mr.
Inman's 1997 employment agreement with Tucker Federal, and (iii) a total of
12,901 shares held for the account of Mr. Inman as a participant in the Plan;
See "Compensation of Executive Officers Compensation Committee Report" and
"Compensation of Executive Officers - Executive Employment Agreements."
(4) With regard to Mr. Nash, the shares shown include (i) 3,332 shares
which are held of record as joint tenants by the spouse and mother-in-law of Mr.
Nash as to which he disclaims beneficial ownership, (ii) 5,500 shares which may
be acquired by Mr. Nash upon the exercise of stock options granted pursuant to
the the DSOP, and (iii) 56,928 shares over which Mr. Nash holds shared voting
power as the Executor of the estate of his step-father.
(5) With regard to Mr. Sechler, the shares shown include (i) 34,500
shares which may be acquired by Mr. Sechler upon exercise of stock options
granted in accordance with Mr. Sechler's 1997 employment agreement with the
Company and pursuant to the DSOP; (ii) a total of 13,429 shares held for the
account of Mr. Sechler as a participant in the Plan; and (iii) 113,000 shares
owned by unaffiliated companies in which Mr. Sechler has controlling interests.
See "Compensation of Executive Officers - Compensation Committee Report."
(6) With regard to Mr. Waldrop, the shares shown include (i) 4,000
shares which may be acquired by Mr. Waldrop upon the exercise of stock options
granted pursuant to the DSOP, (ii) 13,421 shares which may be acquired upon the
exercise of stock options granted upon the conversion of SCFC warrants as a
result of the acquisition of SCFC by the Company in 1997 and (iii) 690 shares
held in the IRA of Mr. Waldrop's spouse, over which he has shared voting and
investment power.
(7) With regard to Mr. Thompson, the shares shown include 1,500 shares
that may be acquired by Mr. Thompson upon the exercise of stock options granted
pursuant to the DSOP.
(8) With regard to Mr. Burrell, the shares shown include 1,000 shares
that may be acquired by Mr. Burrell upon the exercise of stock options granted
pursuant to the DSOP.
MEETINGS AND COMMITTEES OF THE BOARD OF DIRECTORS
The Board of Directors conducts its business through meetings of the
full Board and through committees. The Board of Directors has standing
committees consisting of the Executive Committee, Stock Option Plan Committee,
Audit Committee, Compensation Committee, and the Administrative Committee of the
DSOP. During the fiscal year ended March 31, 1999, the Board of Directors held
seven meetings. No director of the Company attended fewer than 75% of all
meetings of the full Board and of each committee on which such director served
during this period.
The Executive Committee, composed of Messrs. Sechler (Chairman),
Burrell, Alford, Nash and Inman meets in the interim when the full Board is not
in session and may exercise the authority of the Board of Directors except to
the extent that such authority shall be limited by the Articles of
Incorporation, the Bylaws, any resolution of the full Board or by Georgia Law.
The Executive Committee met nine times during the fiscal year ended March 31,
1999.
7
<PAGE> 11
The Stock Option Plan Committee, composed of Messrs. Thompson
(Chairman), Burrell and Alford administers the 1995 Employee Stock Incentive
Plan and the Stock Option Plan and has exclusive power to determine, within the
provisions of the plans, persons eligible to participate in the plans and to
grant options to eligible employees thereunder. The Stock Option Plan Committee
also has the power to interpret and construe any provision of the Stock Option
Plan and to make policy consistent with the Stock Option Plan. The Stock Option
Plan Committee met six times during the fiscal year ended March 31, 1999.
The Audit and Compliance Committee of the Company composed of Messrs.
Nash (Chairman), Burrell, Waldrop and Thompson, as well as Inman and Sechler,
Ex-Officio, also acts as the Audit Committee of the Board of Directors of Tucker
Federal. In the capacity as Audit Committee for the Company, it selects the firm
to be engaged as independent accountants for the Company for the next fiscal
year, reviews the plan for the audit engagement, financial statements, plans and
results of internal auditing, and generally reviews financial reporting
procedures and reports for regulatory authorities. The Audit and Compliance
Committee met five times during the fiscal year ended March 31, 1999.
The Compensation Committee, composed of Messrs. Burrell (Chairman),
Alford, Thompson, Waldrop and Nash has the responsibility of reviewing and
approving the compensation of all executive officers of the Company and all
officers and employees of Tucker Federal whose total compensation exceeds
$100,000 per year and determining the factors and other issues regarding
incentive compensation arrangements. The Compensation Committee met seven times
during the fiscal year ended March 31, 1999.
The Administrative Committee of the DSOP, composed of Messrs. Inman
(Chairman), Nash and Thompson administers the Eagle Bancshares, Inc. 1994
Directors Stock Option Incentive Plan and has the power to effect the granting
of options and interpret the incentive plan pursuant only to the terms and
provisions of the plan. The DSOP Administrative Committee met two times during
the fiscal year ended March 31, 1999.
The Finance Committee was formed in August 1998 to review in detail the
component financial information for the Company and it's subsidiaries. In its
capacity it also reviews peer group information, assesses the capital needs of
the Company and reviews trend analysis data. The committee also acts as the
Finance Committee for Tucker Federal. It is composed of Messrs. Alford
(Chairman), and Waldrop, directors of the Company and Mr. Folds and Mrs.
Petrides, directors of Tucker Federal. Messrs. Sechler and Inman serve as
ex-officio members. The committee met three times during the fiscal year ended
March 31, 1999.
In addition to the standing committees of the Company, the Board of
Directors acted in its capacity as the Nominating Committee and met one time
during the fiscal year ended March 31, 1999. While the Board acting as
Nominating Committee will consider nominees recommended by the shareholders, it
has not actively solicited recommendations from the shareholders for nominees.
Article X of the Company's Restated Articles of Incorporation, as
amended, sets forth the procedures for shareholder nominations and proposals.
Article X states that nominations for the election of directors and proposals
for any new business to be taken up at any annual or special meeting of
shareholders may be made by the Board of Directors or by any shareholder
entitled to vote generally in the election of directors. In order for a
shareholder to make any such nomination and/or proposal, he or she must give
notice thereof in writing, delivered or mailed by first class United States
mail, postage prepaid, to the Secretary of the Company not less than ten days
nor more than sixty days prior to any such meeting. However, if less than 17
days notice of the meeting is given to shareholders, such written notice must be
delivered or mailed, as prescribed, to the Secretary of the Company not later
than the close of the seventh day following the day on which notice of the
meeting was mailed to shareholders. Each such notice given by a shareholder with
respect to nominations for the election of directors must set forth (i) the
name, age, business address and, if known, residence address of each nominee
proposed in such notice, (ii) the principal occupation or employment of each
such nominee, and (iii) the number of shares of Common Stock beneficially owned
by each such nominee.
8
<PAGE> 12
The Board of Directors of Tucker Federal has the following standing
committees in addition to the Audit Committee described above: the Executive
Committee, and the Finance and Investment Committee. Such committees are
composed of both inside and outside directors of Tucker Federal and perform
those duties customarily performed by committees of such designations in other
financial institutions. The Audit Committee meets quarterly with Tucker
Federal's Internal Auditor.
DIRECTOR COMPENSATION
Members of the Board of Directors of the Company receive $300 for each
full Board and $200 for each committee meeting attended for their services as
directors of the Company. Directors of Tucker Federal receive an annual fee of
$5,000, payable quarterly, in addition to $400 for each Board meeting attended.
Executive Committee members of Tucker Federal receive a fee of $200 for each
such committee meeting attended and members of all other Tucker Federal
committees receive a fee of $300 for each committee meeting attended. In
addition certain members of the Board of the Company also serve on the Board of
Directors of Eagle Real Estate Advisors, Inc., a subsidiary of the Company and
on the Board of Directors of Eagle Service Corporation, a subsidiary of Tucker
Federal. Directors of Eagle Real Estate Advisors receive $200 for each Board
meeting attended and Directors for Eagle Service Corporation receive $300 for
each quarterly Board meeting attended.
The outside directors of the Company are eligible for selection to
participate in the Deferred Compensation Plan and the Performance Plan both
described on page 13 in the section entitled "Compensation of Executive
Officers."
EAGLE BANCSHARES, INC. 1994 DIRECTORS STOCK OPTION INCENTIVE PLAN. On
February 10, 1994, the Board of Directors of the Company approved and adopted
the DSOP. Generally, the DSOP provides for grants of nonqualified stock options
to be made to directors of the Company or Tucker Federal on and after February
10, 1994, as follows:
Upon the adoption of the plan for then current directors or upon
initially becoming a director of the Company Tucker Federal,
thereafter, an individual receives an option to purchase 2,000 shares
of Common Stock, which is exercisable on the date of grant; and
Upon beginning any term as a director of the Company or Tucker Federal,
if the individual is not already a member of the Company's Board, an
individual receives an option to purchase 1,500 shares of Common Stock
which vests at the rate of 500 shares per full year of service as a
director thereafter.
All options granted under the DSOP expire no later than the date immediately
following the 10th anniversary of the date of grant, and may expire sooner in
the event of the disability or death of the optionee, or if the optionee ceases
to serve as a director. All options granted under the DSOP may not be assigned
or transferred except upon death, and the exercise price of all options issued
under the DSOP is the fair market value of the Common Stock on the date that the
option is granted.
During the fiscal year ended March 31, 1999, options to purchase 1,500
shares of Common Stock were granted to Mr. Sechler and Mrs. Petrides under the
DSOP. Mrs. Petrides is a director of Tucker Federal.
TUCKER FEDERAL SAVINGS AND LOAN ASSOCIATION DIRECTOR'S RETIREMENT PLAN.
Participants under the Tucker Federal Savings and Loan Association Director's
Retirement Plan (the "Director's Retirement Plan") will receive a benefit in the
form of a monthly annuity for the life of the participant with payments
commencing as of the first day of the month following the later of (i) the date
on which the participant is no longer a Director or (ii) the date on which the
participant attains age 65 (the "payment commencement date") and continuing
until the first day of the month in which the participant's death occurs if the
participant survives until his payment commencement date (although monthly
payments are suspended during any period in which the participant again serves
as a Director). A participant who dies prior to his payment commencement date
will receive no monthly benefit under the Directors' Retirement Plan.
9
<PAGE> 13
The amount of a participant's monthly payments under the Directors'
Retirement Plan is generally equal to the product of (i) the average monthly
compensation (including only compensation paid for service as a Director) of the
participant, and (ii) a percentage based upon the participant's years of service
ranging from 0% with less than six years of service up to 100% with at least
twelve years of service. A participant's average monthly compensation is
determined by averaging the participant's monthly compensation during the
24-month period in the participant's compensation history during which the
participant's compensation is the highest.
In addition to the monthly benefit (if any) provided to a participant
under the Directors' Retirement Plan, a participant also is generally entitled
to an additional lump sum benefit if (i) the participant has completed at least
12 but not 18 or more years of service as of the date on which the participant
is no longer a Director, or (ii) the participant was a Director as of the
effective date of the Directors' Retirement Plan, has completed 12 years of
service as of such date and ceases to be a Director as of, or prior to, the end
of his current term of service as a Director. The lump sum benefit payable to
such participants is 2,000 shares of the Common Stock of the Company or a cash
payment equal to the fair market value (determined in accordance with the
provisions of the DSOP and determined as of the date of payment) of such 2,000
shares, whichever is elected by the participant.
Generally, all benefits under the Directors' Retirement Plan are
unsecured obligations of Tucker Federal, and participants do not, and cannot,
make contributions to fund benefits under the Directors' Retirement Plan.
Generally, the Directors' Retirement Plan is not funded and benefit payments are
made directly by Tucker Federal, although Tucker Federal may make discretionary
contributions to a trust to aid in funding the benefits to be provided under the
Directors' Retirement Plan, and, upon a change of control (as defined in the
Directors' Retirement Plan), the Company must, within ten days of the change of
control, make an irrevocable contribution to a trust in an amount sufficient to
pay all accrued benefits and lump sum benefits to which participants are
entitled as of the date of the change of control.
EXECUTIVE OFFICERS OF THE COMPANY
The following provides information as of March 31, 1999 as to the name,
age and position of the executive officers who are not directors of the Company,
including all positions and offices with the Company and its subsidiaries and
their business experience during the past five years and shares of Common Stock
beneficially owned. Information with respect to executive officers who are
directors of the Company is set forth under "Information Regarding Nominees and
Directors." There are no agreements or understandings between any officer and
any other person pursuant to which any officer was selected.
<TABLE>
<CAPTION>
Shares
Beneficially
Name and Age Current Position(s) and Business Experience Owned(1)(%)
- ------------ ------------------------------------------- ------------
<S> <C> <C>
LuAnn Durden Mrs. Durden has been Senior Vice President and Chief
(39) Financial Officer of Tucker Federal since 1994 and was 42,167(2)
Internal Auditor and Vice President of Finance of (*)
Tucker Federal from 1987 to 1994. Prior to joining
Tucker Federal, Mrs. Durden was a Senior Auditor with
Peat Marwick Mitchell & Co. She was elected Executive
Vice President and Chief Financial Officer of the Company
in 1997.
Betty Petrides Mrs. Petrides has been Executive Vice President of the 110,699(3)
(45) Company since 1997 and of Tucker Federal since 1988 (1.99%)
and Secretary of Tucker Federal since 1989. She was
elected to the Board of Directors of Tucker Federal in
April 1995. She was elected Executive Vice President
of the Company in 1997.
</TABLE>
- ---------------------
10
<PAGE> 14
* Less than one percent.
(1) The stock ownership information shown above has been furnished to the
Company by the named persons. Beneficial ownership as reported in this table has
been determined in accordance with regulations of the Commission and includes
shares of Common Stock which may be acquired within 60 days. Except as otherwise
indicated, the named persons have sole voting and investment power with regard
to the shares shown as owned by them.
(2) With regard to Mrs. Durden, the shares shown include (i) 34,664 shares that
may be acquired upon exercise of stock options granted in accordance with the
terms and conditions of the Stock Option Plan and the 1995 ESIP, and (ii)7,503
shares held for her account as a participant in the Plan.
(3) With regard to Mrs. Petrides, the shares shown include (i) 66,332 shares
that may be acquired upon exercise of stock options granted in accordance with
employment agreements with Tucker Federal and pursuant to the Stock Option Plan
and DSOP; and (ii) 9,367 shares held for the account of Mrs. Petrides as a
participant in the Plan. See "Compensation of Executive Officers Compensation
Committee Report" and "Compensation of Executive Officers - Executive Employment
Agreements."
COMPENSATION OF EXECUTIVE OFFICERS
COMPENSATION COMMITTEE REPORT
The following report of the Compensation Committee of the
Board of Directors (the "Committee") discusses generally the Committee's
executive compensation objectives and policies in connection with developing and
implementing compensation for executive officers and the relationship of those
objectives and policies to corporate performance for the fiscal year ended March
31, 1999. The committee also approves broad-based and special compensation plans
across the Company for members of the Executive Management Team of Tucker
Federal Bank, and for the most senior members of corporate staff. The report
specifically discusses the Committee's bases for compensation of the executive
officers of the Company and Tucker Federal named in the Summary Compensation
Table. In executing its compensation responsibilities, the Committee previously
engaged SNL Compensation Services, a joint venture between the law firm of
Housley Kantarian & Bronstein and SNL Securities, (1) to review and evaluate all
compensation plans, contracts and other compensation practices in connection
with executive compensation of the Company, (2) to review compensation packages
at comparable institutions and (3) to recommend changes to any of those plans or
other practices as the firm deemed appropriate in their professional opinion. As
a result of the engagement, the Committee adopted certain recommendations and
implemented certain changes in the executive compensation program. The Committee
continues to closely monitor, and continually upgrade the compensation system
for executive officers.
Each director serving on the Committee is a disinterested
director. The Committee understands that the performance of each executive
officer and the structure for the reward of that performance has the potential
to directly impact both the short-term and long-term profitability of the
Company. Therefore, the structure of the compensation packages for each
objective has both short-term and long-term components. Persons covered by this
report are C. Jere Sechler, Jr., who serves as both Chairman and President of
the Company and of Eagle Service Corporation, a subsidiary of Tucker Federal,
and as Chairman of Eagle Real Estate Advisors, a subsidiary of the Company,
Richard B. Inman, Jr., who serves as the President of Tucker Federal and of
Eagle Bancshares Capital Group, a subsidiary of the Company designed to provide
mezzanine financing, Betty Petrides, who serves as Executive Vice President of
the Company and of Tucker Federal and Corporate Secretary of Tucker Federal ,
and LuAnn Durden, who serves as Executive Vice President and Chief Financial
Officer of the Company and of Tucker Federal. Each of these individuals is
compensated in an amount greater in total than $100,000 per year and occupies a
position that has the ability to directly influence policy decisions in the
Company or Tucker Federal.
EXECUTIVE COMPENSATION OBJECTIVES AND POLICIES. The mission of
the Committee is to provide for a compensation system that not only supports the
Company's strategic direction but that balances competitive pay requirements and
business economics. We believe that the interests of shareholders are best
served by closely aligning corporate performance objectives to executive
compensation. It is expected that compensation will vary annually based
11
<PAGE> 15
upon both Company and individual executive performance. The Committee believes
that compensation should be based upon both short-term and long-term
measurements and be directly and visibly tied to Company performance, thus
introducing substantial risk in the payout levels. This approach is best
demonstrated in the amounts reflected under the Bonus column of the Summary
Compensation Table from 1997 to 1999. The Committee continues to be guided by
the following policies for compensation decisions:
- - The Company seeks to attract and retain highly qualified employees at
all levels, and in particular, those whose performance is most critical
to the Company's success. The total compensation package must be
designed with the current competitive employment environment in mind in
order to attract the best and brightest executives, provide a motive
for high level individual performance and retain executives whose
skills and leadership are essential for building long-term shareholder
value.
- - We establish annual incentive bonus compensation for executive officers
that is directly tied to the Company's strategic objectives and rewards
for individual performance within those objectives. Such performance is
generally measured on the performance of a business unit or on the
performance of the Company as a whole, or using both criteria, as the
nature of an executive's responsibilities may dictate.
- - It is the Committees long standing philosophy to strongly encourage
stock ownership by both directors and senior management. Therefore, the
implementation of long-term equity incentives that align executive
compensation with benefits realized by all shareholders is a
significant portion of executive compensation.
Total executive compensation consists of base salary, cash
bonus compensation that has a potential to be paid out annually (short-term
incentive) and a combination of stock options and grants that vest over a longer
period of time (long-term incentive). All these components are determined by an
ongoing review of changes in the Company's and its individual business units'
overall financial results over time, as well as similar data for compensation
packages from financial institutions both within the Southeast and in a broader
geographic range that are of comparable size to our Company, to the extend
available. The Company's base salary level for executive officers is below the
median of base salaries of the financial institutions included in the review.
Short-term incentives or cash bonus payments are based upon
predetermined corporate performance measures as well as achievements over which
the individual has control. Return on equity target levels are the principal
corporate performance measures used to determine bonus amounts. A formula of
other performance factors such as earnings per share, return on equity, market
share, efficiency ratio, Company and profit center earnings, internal and
external customer service indicators and organizational development and
community involvement are also considered and weighted in the awarding of bonus
compensation. The formula provides for awards ranging in amount from 25% of base
salary at the threshold performance level to bonuses that exceed 100% of base
salary at the maximum performance level for Mr. Inman, and from 10% to 50% of
base salary for Mrs. Durden. Short term incentive compensation cannot be earned
regardless of Company performance when the level of nonperforming assets and
delinquencies exceed 3% of the total assets of the Company on the last day of
any fiscal year. These criteria serve to insure a continued level of safety and
soundness for the Company.
Long-term incentives or the awards of stock options and stock
grants are made pursuant to the Company's Stock Option Plan(s). Option grants
for Mr. Inman, Mr. Sechler and Mrs. Petrides are subject to three-year vesting,
and options granted to Mrs. Durden in 1994 are subject to five year vesting,
while options granted to Mrs. Durden in 1998 are subject to three-year vesting.
The Committee's belief that a significant portion of senior executives'
compensation should be dependent upon value created for the shareholders is
shared by many of the peer group institutions used in the analysis done for the
Committee by SNL Compensation Services. The Committee believes that both
qualified and non-qualified options as well as restricted stock grants are
excellent vehicles to accomplish the aligning of interests of executive officers
of the Company directly with the interests of shareholders. Options are granted
with an exercise price of not less than the fair market value of the Company's
Common Stock on the date of grant, thus providing value in the executive's
options only if the value for other shareholders is created as well. Options
generally are exercisable for a period of ten years. Long-term compensation is a
significant component of total executive compensation. While the amount of the
awards are not based upon any particular formula, peer group comparisons of
12
<PAGE> 16
stock options and grants as a percentage of base pay is taken into consideration
in determining the amount of such awards. It is intended to provide the
executive officers with a meaningful ownership interest in the Company, thereby
linking compensation both to performance and to the interests of all other
shareholders.
All of the named executive officers are subject to employment
agreements. See "Compensation of Executive Officers - Employment Agreements".
Compensation arrangements for those executives are based upon and in accordance
with the employment agreements. Officers not named in the Summary Compensation
Table and other employees receive total compensation upon the factors noted
above, including an incentive performance award component and their base annual
compensation.
EAGLE BANCSHARES, INC. DEFERRED COMPENSATION PLAN. Effective
April 1, 1999, the Board of Directors of the Company adopted the Eagle
Bancshares, Inc. Deferred Compensation Plan (the "Deferred Compensation Plan").
Eligible consultants, outside directors and employees who are among a select
group of management or highly compensated employees can elect by the beginning
of each fiscal year to defer compensation or fees that they would otherwise
receive during such fiscal year. The Company, at its discretion, may credit a
matching contribution in any amount it chooses for participants who make such
deferrals. Earnings and losses are credited to the deferrals and matching
contributions. Benefits payable under the Deferred Compensation Plan are
unsecured obligations of the Company, but the Company currently intends to
contribute participant deferrals, as well as the Company's matching
contributions, to a grantor trust that will hold such amounts to pay benefits
under the Deferred Compensation Plan. Benefits are paid to participants in cash
and generally equal the amount of their deferrals, any matching contributions in
which they are vested and earnings and losses credited to such deferrals and
vested matching contributions. As part of their annual deferral elections,
participants can elect to receive their benefits at retirement, disability,
death, termination of employment or at least three years after their elections.
In certain other circumstances, participants can receive their benefits earlier,
such as in the event of a personal hardship, a change of control of the Company,
or simply with the approval of the Administrative Committee which in that event
will reduce the amount of the benefit payable by 10%. As a part of their annual
deferral elections, participants also can elect whether they want their benefits
paid in a lump sum or installments, except that payments must be made in a lump
sum in the event of termination of employment, disability, death, a hardship
withdrawal, an early withdrawal or a change of control of the Company. The
Company can amend or terminate the Deferred Compensation Plan at any time, and
in the event of termination, the participants would receive their benefits.
EAGLE BANCSHARES, INC. PERFORMANCE STOCK PLAN. The Board of
Directors of the Company approved and adopted the Eagle Bancshares, Inc.
Performance Stock Plan (the "Performance Plan") effective as of April 1, 1999.
Participants in the Performance Plan, include named senior executive officers
and directors of the Company and Tucker Federal Bank. Participants are granted a
specified number of shares of Restricted Stock under the DSOP or the 1995 ESIP,
as applicable, and Phantom Stock ("Units") on each date of grant. The
Performance Plan provides that if all or any part of a grant of Restricted Stock
may not be made under the DSOP or the 1995 ESIP, as applicable, then the
recipient will be granted Units in lieu of Restricted Stock.
Grants of Restricted Stock or Units may be made in any Plan
Year based upon the percentage increase in earnings per share or Annual Stock
Price provided either increase is greater than 15%. When a grant is made to a
participant, vesting in the Restricted Stock or Units is subject to the Company
achieving a 200% increase in earnings per share or annual stock price. In order
to be fully vested, the per share price of Company Common Stock on March 31,
1999 must double or earnings per share of the Company as of the fiscal year end
March 31, 1999 must double. When full vesting of the Restricted Stock or Units
shall occur, the grant becomes nonforfeitable on a date which is five years
following the date of attaining the performance goal or prior to such date on
the occurrence of a change in control, as defined in the Performance Plan, the
retirement of the participant at age 65 or termination of employment of the
participant, without cause. During the period after grant of Restricted Stock or
Units but prior to vesting, the participant will be entitled to receive
dividends as declared on the Restricted Stock or Units as of each dividend
record date. Any grant or portion thereof which is not vested on the date the
participant ceases to perform services will be forfeited as of such date. The
cash value of the Units granted to a recipient will be paid to the recipient in
a single lump sum within sixty days of the date that the Units become vested and
not subject to forfeiture. The value of each unit will be equal to the value of
a share of the Company's Common Stock on the date of determination.
13
<PAGE> 17
COMPENSATION OF THE CHIEF EXECUTIVE OFFICER OF TUCKER FEDERAL. The
compensation of Richard B. Inman, Jr., President and Chief Executive Officer of
Tucker Federal, was based upon an employment agreement entered into on October
1, 1993. In connection with the employment agreement, which was approved by the
Committee, the base salary was determined based upon the competitive analysis
described above, and was subject to adjustment annually by the Committee,
provided that the base salary would not have been less than $120,000 per year,
and any increases in base salary were not subject to reduction. Mr. Inman's base
salary was not adjusted until a new employment agreement was reached between Mr.
Inman and Tucker Federal Bank on March 27, 1997. See "Compensation of Executive
Officers Employment Agreements." For the year ended March 31, 1999, Mr. Inman
was awarded a cash bonus of $150,162.
OMNIBUS BUDGET RECONCILIATION ACT OF 1993 IMPLICATIONS FOR EXECUTIVE
COMPENSATION. It is the responsibility of the Committee to address the issues
raised by tax laws that make certain non-performance-based compensation in
excess of $1,000,000 to executives of public companies nondeductible to the
Company. In this regard, the Committee must determine whether the Company should
take any actions with respect to this limit. Given the Company's current level
of executive compensation, it is not now necessary to consider this issue. The
Committee will continue to monitor this situation and will take appropriate
action if it is warranted in the future.
THE COMPENSATION COMMITTEE
Richard J. Burrell, Chairman
Walter C. Alford
Weldon A. Nash, Jr.
George G. Thompson, V
William F. Waldrop, Jr.
EXECUTIVE COMPENSATION
SUMMARY OF COMPENSATION. The following table summarizes, for the
Company and its subsidiaries, the elements of compensation paid or accrued
during the three fiscal years ended March 31, 1999 to the Chief Executive
Officer of Tucker Federal and each of the other executive officers whose salary
and bonus exceeded $100,000 for the fiscal year ended March 31, 1999 (the "named
executive officers").
SUMMARY COMPENSATION TABLE
<TABLE>
<CAPTION>
Annual Compensation Long Term Compensation
------------------- ----------------------
Name and Principal Position Year Salary($) Bonus ($) (1) Securities All Other
- --------------------------- ---- --------- --------- Underlying Compensation (3)
Options (2) ------------
-------
<S> <C> <C> <C> <C> <C>
Richard B. Inman, Jr., President and Chief 1999 $150,000 $150,162 -- $30,763
Executive Officer of Tucker
Federal, and Treasurer of the Company 1998 $150,000 $154,410 -- $31,000
1997 $126,100 $ 88,800 36,500 $21,321
</TABLE>
14
<PAGE> 18
<TABLE>
<CAPTION>
Annual Compensation Long Term Compensation
------------------- ----------------------
Name and Principal Position Year Salary($) Bonus ($) (1) Securities All Other
- --------------------------- ---- --------- --------- Underlying Compensation (3)
Options (2) ------------
-------
<S> <C> <C> <C> <C> <C>
C. Jere Sechler, Jr. Chairman of Board and 1999 $175,000 -- 1,500 $31,763
President of the Company and of EREA; and
President of Eagle Service Corporation 1998 $198,958 -- 68,000 $28,000
1997 $115,750 $69,375 -- $18,404
Betty Petrides, Executive Vice President of 1999 $125,000 -- 1,500 $21,346
the Company and Tucker Federal and
Secretary of Tucker Federal 1998 $119,750 -- 26,000 $22,094
1997 $105,400 $69,375 -- $15,517
LuAnn Durden, Executive Vice President and 1999 $105,000 $30,342 -- $ 5,772
Chief Financial Officer of the Company and
Tucker Federal 1998 $ 98,125 $52,500 22,000 $ 5,262
1997 $ 87,917 $23,400 -- $ 9,318
</TABLE>
(1)Reflects cash bonus awards paid during fiscal 1999,1998 and 1997 for
the achievement of specific performance criteria (see "Compensation of Executive
Officers -- Compensation Committee Report -- Executive Compensation Objectives
and Policies").
(2)All Other Compensation paid during fiscal 1999 includes the
following: (i) contributions to the Plan which are made annually by Tucker
Federal: Mr. Sechler - $7463; Mr. Inman - $7463; Mrs. Petrides - $5896; Mrs.
Durden - $5772; and (ii) a car allowance in the following amounts: Mr. Sechler -
$6,000; Mr. Inman - $5700; Mrs. Petrides - $3900 and Mrs. Durden - $0.
All Other Compensation paid during fiscal 1998 includes the following: (i)
contributions to the Plan which are made annually by Tucker Federal: Mr. Sechler
- - $8050; Mr. Inman - $6900; Mrs. Petrides - $6894; Mrs. Durden $5262; and (ii) a
car allowance in the following amounts: Mr. Sechler - $5600; Mr. Inman - $5100;
Mrs. Petrides - $3,300 and Mrs. Durden - $0.
All Other Compensation paid during fiscal 1997 includes the following: (i)
contributions to the Plan by Tucker Federal: Mr. Sechler - $8275; Mr. Inman -
$7375; Mrs. Petrides - $6587; and Mrs. Durden - $5163 and (ii) a car allowance
in the following amounts: Mr. Sechler - $4,800; Mr. Inman - $4,800; Mrs.
Petrides - $3,600; and Mrs. Durden - $0.
OPTIONS. The following table sets forth information regarding the
number and terms of stock options granted to the named executive officers during
the fiscal year ended March 31, 1999. In addition, in accordance with the rules
and regulations of the Commission, set forth is the present value of each option
granted, calculated using the Black-Scholes option pricing model.
15
<PAGE> 19
OPTION GRANTS IN LAST FISCAL YEAR
Individual Grants
-----------------
<TABLE>
<CAPTION>
% of Total
Number of Options
Securities Underlying Granted to Exercise or Grant Date
Options Employees in Base Price Present
Name Granted (#) (1) Fiscal Year ($/Sh) Expiration Date Value($)(2)
- ---- --------------------- ----------- ------ --------------- -----------
<S> <C> <C> <C> <C> <C>
Conrad J.(Jere) Sechler, Jr. 1,500 2.15% $19.50 8/27/08 $5.5125
Richard B. Inman, Jr. -- -- -- --
Betty Petrides 1,500 2.15% $19.50 8/27/08 $5.5125
LuAnn Durden -- -- -- --
</TABLE>
(1) On August 27, 1998, Mr. Sechler and Mrs. Petrides were each granted
options to purchase 1,500 shares of Common Stock at $19.50 per share pursuant to
the provisions of the DSOP. The options vest in increments at a rate of 500
shares per full year of service as a director. The Administrative Committee of
the DSOP approves the grants of these nonqualified options. Options granted
pursuant to the DSOP, represent 2.15% of the total options granted to employees
of the Company during fiscal 1999. The options were granted for 10 years,
subject to earlier termination upon the occurrence of certain events related to
termination of employment or "change in control" of the Company or of Tucker
Federal. The exercise price may be paid in cash, by delivery of already owned
shares or by a combination thereof, subject to certain conditions.
(2) The "Grant Date Present Value" is calculated using the Black-Scholes
Option Valuation Model, assuming a constant dividend yield. This model assumes
no dilution effects and includes the following assumptions for the option to
purchase 1,500 shares of Common Stock granted to Mr. Sechler (stock price as of
the grant date - $19.50), and the option to purchase 1,500 shares of Common
Stock granted to Mrs. Petrides (stock price on the date of grant - $19.50):
expected volatility -30%; risk free rate of return -5.19%; projected annual
dividend -$.64 per share; and period to exercise - ten years, with an estimated
exercise period of seven years.
The following table sets forth option exercises by the named executive
officers during the fiscal year ended March 31, 1999, including the aggregate
value of gains on the date of exercise. The table also sets forth (i) the number
of shares covered by options (both exercisable and unexercisable) as of March
31, 1999 and (ii) the respective value for "in-the-money" options, which
represents the positive spread between the exercise price of existing options
and the fair market value of the Company's Common Stock at March 31, 1999.
16
<PAGE> 20
AGGREGATED OPTION EXERCISES IN LAST FISCAL YEAR
AND FISCAL YEAR-END OPTION VALUES
<TABLE>
<CAPTION>
Number of Securities
Underlying Unexercised Value of Unexercised
Options at Fiscal In-the-Money Options at
Year End(#) Fiscal Year End($)
Shares Acquired Value
Name on Exercise(#) Realized ($) Exercisable Unexercisable Exercisable Unexercisable
- ---- ----------- -------- ----------- ------------- ----------- -------------
<S> <C> <C> <C> <C> <C> <C>
Richard B. Inman, Jr -- -- 47,833 12,167 $ 40,854 $ 6,459
C. Jere Sechler, Jr 14,500 $79,875 34,500 35,000 $ 51,000 $51,000
Betty Petrides -- -- 66,332 9,668 $565,279 $ 3,752
LuAnn Durden -- -- 34,664 7,336 $120,999 $ 501
</TABLE>
17
<PAGE> 21
PERFORMANCE GRAPH
The Commission requires that the Company provide a line graph
presentation that compares the Company's cumulative five year return on an
indexed basis with an overall stock market index and either a published industry
index or an index of peer companies selected by the Company. The performance
graph set forth below compares the Company's cumulative total shareholder return
on Common Stock with the cumulative total return of companies on the Standard
and Poors 500 Index and on the Standard and Poors Savings and Loan Holding
Companies Index. The graph assumes that the value of the investment in the
Company's Common Stock in each index was $100 on March 31, 1994 and also assumes
dividend reinvestment. The shareholder return reflected below for the five year
historical period may not be indicative of future performance.
<TABLE>
<CAPTION>
============================================================================================================
3/31/94 3/31/95 3/31/96 3/31/97 3/31/98 3/31/99
- ------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Eagle Bancshares, Inc. $100 $ 102 $ 142 $ 155 $ 250 $ 176
- ------------------------------------------------------------------------------------------------------------
S&P 500 Index $100 $ 116 $ 153 $ 183 $ 271 $ 321
- ------------------------------------------------------------------------------------------------------------
S&P Savings and Loan
Holding Co's Index $100 $ 111 $ 154 $ 229 $ 381 $ 342
============================================================================================================
</TABLE>
18
<PAGE> 22
EXECUTIVE EMPLOYMENT AGREEMENTS
The Compensation of Richard B. Inman, Jr., President and Chief
Executive Officer of Tucker Federal, was based on an employment agreement
between Mr. Inman and Tucker Federal entered into on October 1, 1993 and
expiring March 31, 1997. The agreement provided for a three-year term of
employment and a base salary of not less than $120,000 per year. The agreement
further provided for both short-term, performance based cash incentives and for
long-term incentive compensation through the award of stock options. Cash
compensation and stock options granted under the 1993 agreement are reflected in
the "Summary Compensation Table" for the period of the agreement
On March 25, 1997, Tucker Federal entered into an employment agreement
with Mr. Inman, which provides for a base salary of not less than $150,000 per
year. The agreement further provides for a performance based, cash bonus based
upon criteria established by the Board of Directors annually. The formula for
bonus compensation for the period ending March 31, 1999 provided for a cash
award of from 25% to in excess of 100% of base salary based upon measurable
performance of the executive against threshold, mid-range and maximum goals for
the Company which includes, among other things, earnings per share, return on
equity and percent of nonaccrual loans and foreclosed property to total assets.
The 1997 agreement further stipulates that Mr. Inman will continue to receive
his base salary for the greater of (i) the remaining term of the agreement or
(ii) 24 months following termination without cause. The agreement also provides
for long-term incentive compensation through the grant of stock options pursuant
to the 1995 ESIP. Pursuant to the agreement, on March 25, 1997, Mr. Inman was
granted an incentive stock option to purchase 15,000 shares of Common Stock at
$16.75 per share and a nonqualified stock option to purchase 20,000 shares of
Common Stock at $16.75. Both options vest in increments of one-third over a
three-year period and expire 10 years from the date of grant. The term of the
agreement may be extended by resolution of the Board of Directors on each
anniversary date of the agreement for an additional one year beyond the then
effective expiration date of the agreement. On May 4, 1999, the Board extended
the term of the agreement for one additional year. In the event the Agreement
terminates in due course at the expiration date by reason of either nonrenewal
or nonextension, Mr. Inman is entitled to 100% of his base pay in effect at the
time, with such amount to be payable over 12 months.
The terms of employment of C. Jere Sechler, Jr., as President of Eagle
Service Corporation, a wholly owned subsidiary of Tucker Federal, and of Betty
Petrides, Executive Vice President of Tucker Federal, had been defined by
employment agreements entered into on June 1, 1994. The agreements provided for
a three year term of employment and a base salary of not less than $93,750 per
year for both Mr. Sechler and Mrs. Petrides. The agreements further provided for
both short-term, performance based cash incentives and for long-term incentive
compensation through the award of stock options. Cash compensation and stock
options granted under the 1994 agreements are reflected in the "Summary
Compensation Table" for the period of the agreements. On June 1, 1997, the
Company entered into an employment agreement with C. Jere Sechler, Jr. as
Chairman, President and Chief Executive Officer with a base salary of not less
than $175,000 per year. The 1997 agreement further stipulates that Mr. Sechler
will continue to receive his base salary for the greater of (i) the remaining
term of the agreement or (ii) 24 months following termination without cause. The
agreement also provides for long-term incentive compensation through the grant
of stock options pursuant to the 1995 ESIP. Pursuant to the agreement, on June
1, 1997, Mr. Sechler was granted a nonqualified stock option to purchase 68,000
shares of Common Stock at $15.75 per share. The option vested one-fourth
immediately and one-fourth each year over the three year period from the date of
the grant and expires ten years from the date of grant. The term of the
agreement may be extended by resolution of the Board of Directors on each
anniversary date of the agreement for an additional one year beyond the then
effective expiration date of the agreement. On June 2, 1998, the Board extended
the agreement for one additional year.
19
<PAGE> 23
Also, on June 1, 1997, Tucker Federal and the Company entered into an
employment agreement with Betty Petrides which provides for a base salary of not
less than $125,000 per year to serve as Executive Vice President of Tucker
Federal and the Company. The 1997 agreement further stipulates that Ms. Petrides
will continue to receive her base salary for the greater of (i) the remaining
term of the agreement or (ii) 24 months following termination without cause. The
agreement also provides for long-term incentive compensation through the grant
of stock options pursuant to the 1995 ESIP. Pursuant to the agreement, on June
1, 1997, Ms. Petrides was granted an incentive stock option to purchase 20,000
shares of Common Stock at $15.75 per share and a non-qualified option to
purchase 6,000 shares of Common Stock at $16.50 per share. The option vests in
increments of one-third over a three year period and expires ten years from the
date of grant. The term of the agreement may be extended by resolution of the
Board of Directors on each anniversary date of the agreement for an additional
one year beyond the then effective expiration date of the agreement. On June 2,
1998, the Board of Directors extended the agreement for one additional year.
The compensation of LuAnn Durden, Executive Vice President and Chief
Financial Officer of the Company and of Tucker Federal was based on an
employment agreement between Mrs. Durden and Tucker Federal entered into on May
17, 1996. This agreement provided for a base salary of $90,000 and for an annual
cash incentive award of between 10% and 40% of base pay based upon a matrix
containing performance factors including earnings per share, efficiency ratio,
return on assets and return on equity. On July 28, 1997 Tucker Federal entered
into an employment agreement with Mrs. Durden providing for a base salary of
$105,000 per year and a cash incentive award of up to 50% of base pay based upon
a performance matrix. The agreement further stipulates that if Mrs. Durden's
employment is terminated due to either a Without Cause Termination or a
Constructive Discharge (both as defined in the agreement), she is entitled to be
paid her then current base salary for an additional 12 month period from the
date of such termination. Pursuant to the agreement on July 28, 1998, Mrs.
Durden was granted an incentive stock option to purchase 20,000 shares of Common
Stock at $17,50 and on August 28, 1998 was granted a non-qualified stock option
to purchase 2,000 shares of Common Stock at $16.50. Both options vest in
increments of one-third over a three year period and expire 10 years from the
date of the grant. The term of the agreement may be extended by resolution of
the Board of Directors on each anniversary date of the agreement for an
additional one year beyond the then effective date of the agreement. On June 1,
1998, the Board of Directors extended the agreement for one additional year.
Additionally, the employment agreements of Messrs. Inman and Sechler
and Mrs. Petrides and Mrs. Durden, provide that in the event of a "Change of
Control" (as hereafter defined) of the ownership of Tucker Federal or the
Company, such executives may resign immediately upon notice to the Company. A
"Change in Control" includes (i) a transaction resulting in the change in
holding or power to vote more than 25% of the voting stock of Tucker Federal or
the Company (ii) the acquisition of the ability to control the election of a
majority of Tucker Federal's or the Company's directors, (iii) the acquisition
of a controlling influence over the management or policies of Tucker Federal or
the Company by any person or by persons acting as a group (within the meaning of
Section 13(d) of the Securities Exchange Act of 1934) or (iv) during any period
of two consecutive years, individuals (the "Continuing Directors") who at the
beginning of such period constitute the Board of Directors of Tucker Federal or
of the Company ("Existing Board") cease for any reason to constitute at least
two-thirds thereof, provided that any individual whose election or nomination
for election as a member of the Existing Board was approved by a vote of at
least two-thirds of the Continuing Directors then in office shall be considered
a Continuing Director. Upon a Change in Control of Tucker Federal or the
Company, each executive will receive severance benefits in the event that either
(i) the executive voluntarily terminates his/her employment within 30 days of
the date of the change in control or (ii) the executive voluntarily terminates
employment within 90 days of the date six months before the event of a Change in
Control or the later of the expiration of the Agreement or the second
anniversary of the event. In the event of a Change of Control, severance
benefits for Mr. Inman, Mr. Sechler and Mrs. Petrides shall be paid in an amount
equal to the difference between the Code Section 280G Maximum and the sum of any
other "parachute payments" as defined under Code Section 280G (b) (2) that such
person receives on account of the Change in Control. Additionally, pursuant to
certain Stock Option Agreements entered into upon the granting of stock options
under the 1995 ESIP, all outstanding, unexpired options vest immediately upon a
Change in Control as defined in the 1995 ESIP.
20
<PAGE> 24
CERTAIN TRANSACTIONS
From time to time, in the normal course of business, the Company makes loans to
it's to executive officers, Directors and Director nominees and their affiliates
(including immediate family members). During the fiscal year ended March 31,
1999, no such transactions occurred whose aggregate loan balances exceeded
$60,000 at any time during the preceding fiscal year.
SECTION 16(A) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
Section 16(a) of the Securities Exchange Act of 1934 and regulations of
the Commission thereunder require the Company's executive officers and directors
and persons who own more than ten percent of the Company's Common Stock, as well
as certain affiliates of such persons, to file initial reports of ownership and
reports in changes in ownership with the Commission and the National Association
of Securities Dealers, Inc. Executive officers, directors and persons owning
more than ten percent of the Company's Common Stock are required by Commission
regulation to furnish the Company with copies of all Section 16(a) forms they
file. Based solely on its review of the copies of such forms received by it and
written representations that no other reports were required for those persons,
the Company believes that, during the fiscal year ended March 31, 1999 its
executive officers, directors, and owners of more than ten percent of the
Company's Common Stock complied with all such applicable filing requirements.
PROPOSAL 2 - RATIFICATION OF APPOINTMENT OF INDEPENDENT ACCOUNTANTS
Board of Directors has appointed Arthur Andersen LLP, independent
public accountants, as independent accountants for the Company for the fiscal
year ending March 31, 2000, which appointment the shareholders are requested to
ratify. The appointment will be reconsidered by the directors if not ratified by
shareholders.
Representatives of Arthur Andersen LLP are expected to be present at
the Annual Meeting, will have an opportunity to make a statement if they desire
to do so and will be available to respond to shareholders' questions.
THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS THAT SHAREHOLDERS VOTE
"FOR" THE PROPOSAL TO RATIFY THE APPOINTMENT OF ARTHUR ANDERSEN LLP AS
INDEPENDENT PUBLIC ACCOUNTANTS FOR THE FISCAL YEAR ENDING MARCH 31, 2000.
SHAREHOLDER PROPOSALS FOR 2000 ANNUAL MEETING
Proposals of shareholders of the Company intended to be presented at
the 2000 Annual Meeting of Shareholders must be received by the Company at its
principal executive offices on or before March 27, 2000 to be eligible for
inclusion in the Company's Proxy Statement and form of Proxy relating to the
2000 Annual Meeting of Shareholders.
OTHER MATTERS THAT MAY COME BEFORE THE ANNUAL MEETING
The Board of Directors knows of no other matters other than those
described herein which may properly come before the Annual Meeting. However, if
any other matters should properly come before the Annual Meeting, it is the
intention of the persons designated as proxies to vote on such matters in
accordance with their judgment.
21
<PAGE> 25
UPON THE WRITTEN REQUEST OF ANY PERSON WHOSE PROXY IS SOLICITED BY THIS
PROXY STATEMENT, THE COMPANY WILL FURNISH TO SUCH PERSON WITHOUT CHARGE (OTHER
THAN FOR EXHIBITS) A COPY OF THE COMPANY'S ANNUAL REPORT ON FORM 10-K FOR ITS
FISCAL YEAR ENDED MARCH 31, 1999, INCLUDING FINANCIAL STATEMENTS AND SCHEDULES
THERETO, AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION. REQUESTS SHOULD
BE DIRECTED TO EAGLE BANCSHARES, INC., 4419 COWAN ROAD, TUCKER, GEORGIA 30084,
ATTENTION: RICHARD B. INMAN, JR., SECRETARY. SUCH ANNUAL REPORT IS NOT TO BE
TREATED AS PART OF THE PROXY SOLICITATION MATERIALS OR AS HAVING BEEN
INCORPORATED HEREIN BY REFERENCE.
22
<PAGE> 26
REVOCABLE PROXY EAGLE BANCSHARES, INC.
COMMON STOCK
THIS PROXY IS SOLICITED BY THE BOARD OF DIRECTORS FOR THE 1999 ANNUAL MEETING
OF SHAREHOLDERS
The undersigned hereby appoints Betty Petrides and Zelma B. Martin, and
each of them, proxies, with full power of substitution, to act for and in the
name of the undersigned to vote all shares of Common Stock of Eagle Bancshares,
Inc. (the "Company") which the undersigned is entitled to vote at the 1999
Annual Meeting of Shareholders of the Company, to be held at the Marriott
Century Center Hotel, 2000 Century Boulevard, Atlanta, Georgia, on Thursday,
August 26, 1999, at 10:30 a.m., local time, and at any and all adjournments
thereof, as indicated below.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE "FOR" EACH OF THE LISTED PROPOSALS.
1) Elect as directors the two nominees listed below to serve for a term of
three years or until their successors have been duly elected and qualified:
<TABLE>
<S> <C>
[ ] FOR BOTH NOMINEES listed below [ ] WITHHOLD AUTHORITY to vote
(except as marked to the contrary below). for both nominees listed below.
</TABLE>
INSTRUCTION: TO WITHHOLD AUTHORITY TO VOTE FOR ANY INDIVIDUAL NOMINEE,
STRIKE A LINE THROUGH THE NOMINEE'S NAME IN THE LIST BELOW.
Richard B. Inman, Jr. and Walter C. Alford.
2) Ratify the appointment of Arthur Andersen LLP as independent public
accountants for the Company for the fiscal year ending March 31, 2000.
[ ] FOR [ ] AGAINST [ ] ABSTAIN
In their discretion, the proxies are authorized to vote upon such other
business as properly may come before the Annual Meeting and any and all
adjournments thereof.
PLEASE COMPLETE, DATE, SIGN AND MAIL THIS PROXY CARD IN THE ENCLOSED
POSTAGE-PAID ENVELOPE.
(Continued and to be signed and dated on the reverse side)
<PAGE> 27
(Continued from the other side)
PROXY - SOLICITED BY THE BOARD OF DIRECTORS
This proxy card will be voted as directed. IF NO INSTRUCTIONS ARE SPECIFIED,
THIS PROXY CARD WILL BE VOTED "FOR" PROPOSALS 1 AND 2 LISTED ON THE REVERSE
SIDE OF THIS PROXY CARD. If any other business is presented at the Annual
Meeting, this proxy card will be voted by the proxies in their best judgment.
At the present time, the Board of Directors knows of no other business to be
presented at the Annual Meeting.
The undersigned may elect to withdraw this proxy card at any time prior to its
use by giving written notice to the Corporate Secretary, or by executing and
delivering to the Corporate Secretary a duly executed proxy card bearing a
later date, or by appearing at the Annual Meeting and voting in person.
---------------------------------
Signature
---------------------------------
Signature, if shares held jointly
Date:
---------------------------
Please mark, date and sign exactly as your name appears on this proxy card.
When shares are held jointly, both holders should sign. When signing as
attorney, executor, administrator, trustee, guardian or custodian, please
give your full title. If the holder is a corporation or a partnership, the full
corporate or partnership name should be signed by a duly authorized officer.
Do you plan to attend the Annual Meeting [ ] YES [ ] NO
