<PAGE>
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:
/ / Preliminary Proxy Statement / / Confidential, for Use of the Commission Only
/X/ Definitive Proxy Statement (as permitted by Rule 14a-6(e)(2))
/ / Definitive Additional Materials
/ / Soliciting Material Pursuant to Rule 14a-11(c) or Rule 14a-12
GS Financial Corp.
- --------------------------------------------------------------------------------
(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>
GS FINANCIAL CORP.
3798 Veterans Memorial Boulevard
Metairie, Louisiana 70002
(504) 457-6220
September 16, 1997
Dear Stockholder:
You are cordially invited to attend a Special Meeting of Stockholders of
GS Financial Corp. The meeting will be held at the main office of the
Company located at 3798 Veterans Memorial Boulevard, Metairie, Louisiana on
Wednesday, October 15, 1997 at 4:30 p.m., Central Time. The matters to be
considered by stockholders at the Special Meeting are described in the
accompanying materials.
The Board of Directors of GS Financial Corp. has determined that the
matters to be considered at the Special Meeting are in the best interests of
the Company and its shareholders. For the reasons set forth in the Proxy
Statement, the Board unanimously recommends that you vote "FOR" each matter
to be considered.
It is very important that your shares be voted at the Special Meeting
regardless of the number you own or whether you are able to attend the
meeting in person. We urge you to mark, sign, and date your proxy card today
and return it in the envelope provided, even if you plan to attend the
Special Meeting. This will not prevent you from voting in person, but will
ensure that your vote is counted if you are unable to attend.
On behalf of the Board of Directors and all of the employees of the
Company and the Association, I thank you for your continued interest and
support.
Sincerely,
/s/ Donald C. Scott
--------------------------------------
Donald C. Scott
President and Chief Executive Officer
<PAGE>
GS FINANCIAL CORP.
3798 Veterans Memorial Boulevard
Metairie, Louisiana 70002
(504) 457-6220
______________
NOTICE OF SPECIAL MEETING OF STOCKHOLDERS
To Be Held on October 15, 1997
______________
NOTICE IS HEREBY GIVEN that a Special Meeting of Stockholders ("Special
Meeting") of GS Financial Corp. (the "Company") will be held at the main
office of the Company located at 3798 Veterans Memorial Boulevard, Metairie,
Louisiana on Wednesday, October 15, 1997 at 4:30 p.m., Central Time, for the
following purposes, all of which are more completely set forth in the
accompanying Proxy Statement:
(1) To consider and approve the adoption of the Company's 1997 Stock
Option Plan;
(2) To consider and approve the adoption of the Company's 1997
Recognition and Retention Plan and Trust;
(3) If necessary, to adjourn the Special Meeting to solicit additional
proxies; and
(4) To transact such other business as may properly come before the
meeting or any adjournment thereof. Management is not aware of any other
such business.
The Board of Directors has fixed September 10, 1997 as the voting record
date for the determination of stockholders entitled to notice of and to vote
at the Special Meeting and at any adjournment thereof. Only those
stockholders of record as of the close of business on that date will be
entitled to vote at the Special Meeting or at any such adjournment.
By Order of the Board of Directors
Lettie R. Moll
Vice President and Secretary
Metairie, Louisiana
September 16, 1997
YOU ARE CORDIALLY INVITED TO ATTEND THE SPECIAL MEETING. IT IS IMPORTANT
THAT YOUR SHARES BE REPRESENTED REGARDLESS OF THE NUMBER YOU OWN. EVEN IF
YOU PLAN TO BE PRESENT, YOU ARE URGED TO COMPLETE, SIGN, DATE AND RETURN THE
ENCLOSED PROXY PROMPTLY IN THE ENVELOPE PROVIDED. IF YOU ATTEND THE MEETING,
YOU MAY VOTE EITHER IN PERSON OR BY PROXY. ANY PROXY GIVEN MAY BE REVOKED BY
YOU IN WRITING OR IN PERSON AT ANY TIME PRIOR TO THE EXERCISE THEREOF.
<PAGE>
GS FINANCIAL CORP.
______________
PROXY STATEMENT
______________
SPECIAL MEETING OF STOCKHOLDERS
September 16, 1997
This Proxy Statement is furnished to holders of common stock, $0.01 par
value per share ("Common Stock"), of GS Financial Corp. (the "Company"). The
Company acquired all of the stock of Guaranty Savings and Loan Association
(the "Association") issued in connection with the Association's conversion
from mutual to stock form in April 1997 (the "Conversion"). Proxies are
being solicited on behalf of the Board of Directors of the Company to be used
at the Special Meeting of Stockholders ("Special Meeting") to be held at the
main office of the Company located at 3798 Veterans Memorial Boulevard,
Metairie, Louisiana on Wednesday, October 15, 1997 at 4:30 p.m., Central
Time, and at any adjournment thereof for the purposes set forth in the Notice
of Special Meeting of Stockholders. This Proxy Statement is first being
mailed to stockholders on or about September 16, 1997.
The proxy solicited hereby, if properly signed and returned to the
Company and not revoked prior to its use, will be voted in accordance with
the instructions contained therein. If no contrary instructions are given,
each proxy received will be voted FOR the matters described below and upon
the transaction of such other business as may properly come before the
meeting in accordance with the best judgment of the persons appointed as
proxies. Any stockholder giving a proxy has the power to revoke it at any
time before it is exercised by (i) filing with the Secretary of the Company
written notice thereof (Lettie R. Moll, Corporate Secretary, GS Financial
Corp., 3798 Veterans Memorial Boulevard, Metairie, Louisiana 70002); (ii)
submitting a duly-executed proxy bearing a later date; or (iii) appearing at
the Special Meeting and giving the Secretary notice of his or her intention
to vote in person. Proxies solicited hereby may be exercised only at the
Special Meeting and any adjournment thereof and will not be used for any
other meeting.
VOTING
Only stockholders of record of the Company at the close of business on
September 10, 1997 ("Voting Record Date") are entitled to notice of and to
vote at the Special Meeting and at any adjournment thereof. On the Voting
Record Date, there were 3,438,500 shares of Common Stock of the Company
issued and outstanding and the Company had no other class of equity
securities outstanding. Each share of Common Stock is entitled to one vote at
the Special Meeting on all matters properly presented at the Special Meeting.
The affirmative vote of the holders of a majority of the total votes
eligible to be cast in person
<PAGE>
or by proxy at the Special Meeting is required for approval of the proposals
to approve the Company's 1997 Stock Option Plan ("Stock Option Plan") and the
Company's 1997 Recognition and Retention Plan and Trust ("Recognition Plan").
A majority of the total votes present in person and by proxy will be
required to adjourn the Special Meeting, if such action is required to be
voted on. Because of the required votes, abstentions will have the same
effect as a vote against the proposals. Under rules applicable to
broker-dealers, the proposal for adjournment, if necessary, is considered a
"discretionary" item upon which brokerage firms may vote in their discretion
on behalf of their clients if such clients have not furnished voting
instructions and for which there will not be "broker non-votes." The
proposals to approve the Stock Option Plan and the Recognition Plan, however,
are considered "non-discretionary" and for which there may be broker
non-votes. A broker non-vote will have the same effect as a vote against the
proposals to approve the Stock Option Plan and the Recognition Plan.
2
<PAGE>
BENEFICIAL OWNERSHIP OF COMMON STOCK
BY CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
The following table sets forth, as of the Voting Record Date, certain
information as to the Common Stock beneficially owned by (i) each person or
entity, including any "group" as that term is used in Section 13(d)(3) of the
Securities Exchange Act of 1934, as amended ("Exchange Act"), who or which
was known to the Company to be the beneficial owner of more than 5% of the
issued and outstanding Common Stock, (ii) the directors of the Company, (iii)
those executive officers of the Company whose salary and bonus exceeded
$100,000 in fiscal 1996, and (iv) all directors and executive officers of the
Company and the Association as a group.
Amount and Nature
Name of Beneficial of Beneficial
Owner or Number of Ownership as of Percent of
Persons in Group September 10, 1997(1) Common Stock
- ------------------ -------------------- -------------
GS Financial Corp. 275,080(2) 8.0%
Employee Stock Ownership Plan Trust
3798 Veterans Memorial Boulevard
Metairie, Louisiana 70002
Directors:
Kenneth B. Caldcleugh 5,100 *
Stephen L. Cory 7,000 *
Bradford A. Glazer 11,000(8) *
J. Scott Key 25,000 *
Victor Kirschman 15,000 *
Mannie D. Paine, Jr., M.D. 12,500(5) *
Bruce A. Scott 33,000(2)(3) *
Donald C. Scott 32,100(4) *
Albert J. Zahn, Jr. 34,500(6) 1.0
Employee:
Ralph E. Weber 1,200(7) *
All directors and executive officers of
the Company and the Association as
a group (11 persons)
(Footnotes on following page)
3
<PAGE>
_________________
* Represents less than 1% of the outstanding Common Stock.
(1) Based upon filings made pursuant to the Exchange Act and information
furnished by the respective individuals. Under regulations promulgated
pursuant to the Exchange Act, shares of Common Stock are deemed to be
beneficially owned by a person if he or she directly or indirectly has or
shares (i) voting power, which includes the power to vote or to direct
the voting of the shares, or (ii) investment power, which includes the
power to dispose or to direct the disposition of the shares. Unless
otherwise indicated, the named beneficial owner has sole voting and
dispositive power with respect to the shares.
(2) The GS Financial Corp. Employee Stock Ownership Plan Trust ("Trust") was
established pursuant to the GS Financial Corp. Employee Stock Ownership
Plan ("ESOP") by an agreement between the Company and Ms. Lettie R. Moll
and Messrs. Ralph Weber and Bruce Scott who act as trustees of the plan
("Trustees"). As of the Voting Record Date, no shares held in the Trust
had been allocated to the accounts of participating employees. Since no
shares held in the Trust were allocated as of the Voting Record Date,
unallocated shares held in the ESOP will be voted by the Trustees in
accordance with their fiduciary duties as Trustees. The amount of Common
Stock beneficially owned by directors who serve as Trustees of the ESOP
and by all directors and executive officers as a group does not include
the shares held by the Trust.
(3) Includes 5,000 shares of Common Stock held in trusts for the benefit of
Bruce Scott's children, for which Mr. Scott is the trustee. Mr. Scott
disclaims beneficial ownership as to the shares held in such trusts.
Also includes 5,000 shares owned by Mr. Scott's wife.
(4) Includes 23,100 shares of Common Stock held jointly with Donald Scott's
wife and 4,000 shares held in trusts for the benefit of Mr. Scott's
children, for which Mr. Scott is the Trustee. Mr. Scott disclaims
beneficial ownership as to the shares held in such trusts. Also includes
2,500 owned by Mr. Scott's wife.
(5) Includes 6,250 shares of Common Stock owned by Dr. Paine's wife.
(6) Includes 9,500 shares of Common Stock owned by Mr. Zahn's wife.
(7) Includes 200 shares of Common Stock held by Mr. Weber's child who lives
with him.
(8) Includes 1,000 shares of Common Stock held by Mr. Glazer's wife. Mr.
Glazer disclaims beneficial ownership as to the shares owned by his wife.
4
<PAGE>
PROPOSAL TO ADOPT THE 1997 STOCK OPTION PLAN
General
The Board of Directors has adopted the Stock Option Plan to improve the
growth and profitability of the Company and the Association by providing
employees and non-employee directors with a proprietary interest in the
Company as an incentive to contribute to the success of the Company and the
Association, and to reward employees for outstanding performance. The Stock
Option Plan provides for the grant of incentive stock options intended to
comply with the requirements of Section 422 of the Internal Revenue Code of
1986, as amended (the "Code") ("incentive stock options"), non-qualified or
compensatory stock options and stock appreciation rights (collectively
"Awards"). Awards will be available for grant to directors and key employees
of the Company and any subsidiaries, except that directors will not be
eligible to receive incentive stock options. If stockholder approval is
obtained, options to acquire shares of Common Stock will be awarded to key
employees of the Company and the Association and directors of the Company
with an exercise price equal to the fair market value of the Common Stock on
the date of such approval.
The Stock Option Plan complies with applicable OTS regulations and is
required to be submitted to the OTS after approval by stockholders. No
assurance can be given as to whether the OTS will raise any objections to the
Stock Option Plan as presented to stockholders or whether the OTS may require
modifications to be made to the Stock Option Plan. A vote for approval of
the Stock Option Plan shall be deemed to be a vote for approval of the Stock
Option Plan as the same may be required to be modified by the OTS, provided
that the change is not material as determined by the Company. The Company
will not make any modification to the Stock Option Plan which would increase
the level of benefits from that presented. Non-objection to the Stock Option
Plan by the OTS shall not constitute approval or endorsement of the Stock
Option Plan by the OTS.
Description of the Stock Option Plan
The following description of the Stock Option Plan is a summary of its
terms and is qualified in its entirety by reference to the Stock Option Plan,
a copy of which is attached hereto as Appendix A.
Administration. The Stock Option Plan is administered and interpreted by
a committee of the Board of Directors ("Committee") that is composed solely
of two or more "Non-Employee Directors."
Stock Options. Under the Stock Option Plan, the Board of Directors or
the Committee determines which officers and key employees will be granted
options, whether such options will be incentive or compensatory options, the
number of shares subject to each option, whether such options may be
exercised by delivering other shares of Common Stock and when such options
become exercisable. The per share exercise price of a stock option
5
<PAGE>
shall be not less than to the fair market value of a share of Common Stock on
the date the option is granted.
All options granted to participants under the Stock Option Plan shall
become vested and exercisable at the rate of 20% per year over five years,
commencing one year from the date of grant and an additional 20% shall vest
on each successive annual anniversary of the date the options were granted,
and the right to exercise shall be cumulative. Notwithstanding the
foregoing, no vesting shall occur on or after a participant's employment with
the Company is terminated for any reason other than his death or disability.
Unless the Committee shall specifically state otherwise at the time an option
is granted, all options granted to participants shall become vested and
exercisable in full on the date an optionee terminates his employment with or
service to the Company or a subsidiary company because of his death or
disability. In addition, all stock options will become vested and
exercisable in full on the date of a change in control of the Company or on
the date an optionee terminates his employment or service to the Company or a
subsidiary company due to retirement, each as defined in the Stock Option
Plan, if, as of such date of retirement or change in control of the Company,
such treatment is either authorized or is not prohibited by applicable laws
and regulations.
Each stock option or portion thereof shall be exercisable at any time on
or after it vests and is exercisable until the earlier of ten years after its
date of grant or three months after the date on which the optionee's
employment or service as a non-employee director terminates, unless extended
by the Committee to a period not to exceed five years from such termination.
However, failure to exercise incentive stock options within three months
after the date on which the optionee's employment terminates may result in
adverse tax consequences to the optionee. If an optionee dies while serving
as an employee or a non-employee director or terminates his service as an
employee or a non-employee director as a result of disability without having
fully exercised his options, the optionee's executors, administrators,
legatees or distributees of his estate shall have the right to exercise such
options during the twelve-month period following the earlier of his death or
termination due to disability, provided no option will be exercisable more
than ten years from the date it was granted. Stock options are
non-transferable except by will or the laws of descent and distribution.
Notwithstanding the foregoing, an optionee who holds non-qualified options
may transfer such options to his or her spouse, lineal ascendants, lineal
descendants, or to a duly established trust for the benefit or one or more of
these individuals. Options so transferred may thereafter be transferred only
to the optionee who originally received the grant or to an individual or
trust to whom the optionee could have initially transferred the option.
Options which are so transferred shall be exercisable by the transferee
according to the same terms and conditions as applied to the optionee.
Payment for shares purchased upon the exercise of options may be made in
cash or, at the discretion of the Committee or the Board, by delivering
shares of Common Stock (including shares acquired pursuant to the exercise of
an option) or other property with a fair market value equal to the total
option price, by withholding some of the shares of Common Stock which are
being purchased upon exercise of an option, or any combination
6
<PAGE>
of the foregoing. To the extent an optionee already owns shares of Common
Stock prior to the exercise of his or her option, such shares could be used
(if permitted by Committee or the Board) as payment for the exercise price of
the option. If the fair market value of a share of Common Stock at the time
of exercise is greater than the exercise price per share, this feature would
enable the optionee to acquire a number of shares of Common Stock upon
exercise of the option which is greater than the number of shares delivered
as payment for the exercise price. In addition, an optionee can exercise his
or her option in whole or in part and then deliver the shares acquired upon
such exercise (if permitted by the Committee or the Board) as payment for the
exercise price of all or part of his options. Again, if the fair market
value of a share of Common Stock at the time of exercise is greater than the
exercise price per share, this feature would enable the optionee to either
(1) reduce the amount of cash required to receive a fixed number of shares
upon exercise of the option or (2) receive a greater number of shares upon
exercise of the option for the same amount of cash that would have otherwise
been used. Because options may be exercised in part from time to time, the
ability to deliver Common Stock as payment of the exercise price could enable
the optionee to turn a relatively small number of shares into a large number
of shares.
Stock Appreciation Rights. Under the Stock Option Plan, the Board of
Directors or the Committee is authorized to grant rights to optionees ("stock
appreciation rights") under which an optionee may surrender any exercisable
incentive stock option or compensatory stock option or part thereof in return
for payment by the Company to the optionee of cash or Common Stock in an
amount equal to the excess of the fair market value of the shares of Common
Stock subject to option at the time over the option price of such shares, or
a combination of cash and Common Stock. Stock appreciation rights may be
granted concurrently with the stock options to which they relate or at any
time thereafter which is prior to the exercise or expiration of such options.
Number of Shares Covered by the Stock Option Plan. A total of 343,850
shares of Common Stock has been reserved for issuance pursuant to the Stock
Option Plan, which is 10% of the Common Stock issued in connection with the
Conversion. In the event of a stock split, reverse stock split or stock
dividend, the number of shares of Common Stock under the Stock Option Plan,
the number of shares to which any Award relates and the exercise price per
share under any option shall be adjusted to reflect such increase or decrease
in the total number of shares of the Common Stock outstanding.
Amendment and Termination of the Stock Option Plan. Unless sooner
terminated, the Stock Option Plan shall continue in effect for a period of
ten years from the date the Stock Option Plan was adopted by the Board and
became effective by its terms. Termination of the Stock Option Plan shall
not affect any previously granted Awards.
Federal Income Tax Consequences. Under current provisions of the Code,
the federal income tax treatment of incentive stock options and compensatory
stock options is different. As regards incentive stock options, an optionee
who meets certain holding period requirements will not recognize income at
the time the option is granted or at the time the
7
<PAGE>
option is exercised, and a federal income tax deduction generally will not be
available to the Company at any time as a result of such grant or exercise.
With respect to compensatory stock options, the difference between the fair
market value on the date of exercise and the option exercise price generally
will be treated as compensation income upon exercise, and the Company will be
entitled to a deduction in the amount of income so recognized by the
optionee.
The above description of tax consequences under federal law is
necessarily general in nature and does not purport to be complete. Moreover,
statutory provisions are subject to change, as are their interpretations, and
their application may vary in individual circumstances. Finally, the
consequences under applicable state and local income tax laws may not be the
same as under the federal income tax laws.
Accounting Treatment. Stock appreciation rights will, in most cases,
require a charge against the earnings of the Company each year representing
appreciation in the value of such rights over periods in which they become
exercisable. Such charge is based on the difference between the exercise
price specified in the related option and the current market price of the
Common Stock. In the event of a decline in the market price of the Common
Stock subsequent to a charge against earnings related to the estimated costs
of stock appreciation rights, a reversal of prior charges is made in the
amount of such decline (but not to exceed aggregate prior charges).
Neither the grant nor the exercise of an incentive stock option or a
compensatory stock option under the Option Plan currently requires any charge
against earnings under GAAP. This treatment currently is being evaluated by
the Financial Accounting Standards Board, which has issued an exposure draft
which would require the recognition of expense under GAAP based upon the fair
market value of stock compensation awards when stock options and similar
awards are granted, and thus could change in the future. In certain
circumstances, shares issuable pursuant to outstanding options under the
Option Plan might be considered outstanding for purposes of calculating
earnings per share.
Stockholder Approval. No Awards will be granted under the Stock Option
Plan unless the Stock Option Plan is approved by stockholders. Stockholder
ratification of the Stock Option Plan will satisfy certain federal tax
requirements, NASDAQ National Market ("NNM") listing and OTS requirements.
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Awards to be Granted. The Board of Directors of the Company adopted the
Stock Option Plan and approved the grant of incentive options to executive
officers and employees of the Company and the Association and non-qualified
options to non-employee directors thereof. The options shall be effective
upon stockholder approval of the Stock Option Plan with a per share exercise
price equal to the fair market value of a share of Common Stock on the date
of such approval. The following table sets forth certain information with
respect to such grants.
Number of Shares
Name of Individual or Subject to
Number of Persons in Group Title Stock Options
- -------------------------- ----- -----------------
Donald C. Scott President and Chief 85,962
Executive Officer
Bruce A. Scott Executive Vice President 85,962
All executive officers as --- (1)
a group (4 persons)
All non-employee directors --- 103,155
as a group (7 persons)
All employees, not including --- (1)
executive officers, as a
group (29 persons)
____________________________
(1) The amount of options to be granted to the executive officers as a group
(4 persons) and all employees, not including executive officers, as a group
(29 persons) has not been determined.
(2) On September 9, 1997, the closing price of a share of Common Stock as
reported by the Nasdaq Stock Market National Market was $15-1/2.
The Board of Directors recommends that stockholders vote FOR adoption of
the Stock Option Plan.
9
<PAGE>
PROPOSAL TO ADOPT THE 1997 RECOGNITION
AND RETENTION PLAN AND TRUST
General
The Board of Directors of the Company has adopted the Recognition Plan,
the objective of which is to retain personnel of experience and ability in
key positions by providing employees and non-employee directors of the
Company and the Association with a proprietary interest in the Company as
compensation for their contributions to the Company and the Association and
as an incentive to make such contributions in the future. Officers and key
employees of the Company who are selected by the Board of Directors of the
Company or a committee thereof, as well as non-employee directors of the
Company, will be eligible to receive benefits under the Recognition Plan. If
stockholder approval is obtained, shares will be granted to employees and to
non-employee directors as described below.
The Recognition Plan complies with applicable OTS Regulations and is
required to be submitted to the OTS after approval by stockholders. No
assurance can be given as to whether the OTS will raise any objections to the
Recognition Plan as presented to stockholders or whether it may require
modifications to be made to the Recognition Plan. A vote for approval of the
Recognition Plan shall be deemed to be a vote for approval of the Recognition
Plan as the same may be required to be modified by the OTS, provided that the
change is not material as determined by the Company. The Company will not
make any modification to the Recognition Plan which would increase the level
of benefits from that presented. Non-objection to the Recognition Plan by
the OTS shall not constitute approval or endorsement of the Recognition Plan
by the OTS.
Description of the Recognition Plan
The following description of the Recognition Plan is a summary of its
terms and is qualified in its entirety by reference to the Recognition Plan,
a copy of which is attached hereto as Appendix B.
Administration. The Recognition Plan is administered and interpreted by
a committee of the Board of Directors ("Committee") that is composed solely
of two or more "Non-Employee Directors."
Upon stockholder approval of the Recognition Plan, the Company will
acquire Common Stock on behalf of the Recognition Plan, in an amount
necessary to purchase the number of shares of Common Stock equal to 4% of the
Common Stock issued in the Conversion, or 137,540 shares. It is anticipated
that these shares will be acquired through open market purchases.
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Grants. Shares of Common Stock granted pursuant to the Recognition Plan
will be in the form of restricted stock and shall be earned by a recipient at
the rate of 20% per year over five years, commencing one year from the date
of grant and an additional 20% shall be earned as of each successive annual
anniversary of the date of grant. A recipient will be entitled to all voting
and other stockholder rights with respect to shares which have been earned
and distributed to such recipient under the Recognition Plan. However, until
such shares have been earned and distributed, they may not be sold, pledged
or otherwise disposed of and are required to be held in the Recognition Plan
Trust ("Trust"). Under the terms of the Recognition Plan, after an award has
been made, the recipient will be entitled to direct the Trustee as to the
voting of the Common Stock covered by such award which has not yet been
earned and distributed to the recipient. All shares of Common Stock held by
the Trust which have not been awarded and shares which have been awarded as
to which recipients have not directed the voting shall be voted by the
Recognition Plan Trustee ("Trustee") in the same proportion as voted by the
Trustee for shares allocated and which the Trustee receives directions for
such vote by recipients. In addition, any cash dividends or stock dividends
declared in respect of unvested share awards will be held by the Trust for
the benefit of the recipients and such dividends, including any interest
thereon, will be paid out proportionately by the Trust to the recipients
thereof as soon as practicable after the share awards become earned. Any
cash dividends or stock dividends declared in respect of each vested share
held by the Trust will be paid by the Trust as soon as practicable after the
Trust's receipt thereof to the recipient on whose behalf such share is then
held by the Trust.
If a recipient terminates employment for reasons other than death,
disability or retirement, the recipient will forfeit all rights to the
allocated shares under restriction. All shares subject to an award held by a
recipient whose employment with or service to the Company or any subsidiary
terminates due to death or Disability, as defined in the Recognition Plan,
shall be deemed earned as of the recipient's last day of employment with or
service to the Company or any subsidiary and shall be distributed as soon as
practicable thereafter; provided, however, that awards shall be distributed
in accordance with the Recognition Plan. In addition, in the event that a
recipient's employment with or service to the Company or any subsidiary
terminates due to retirement, as defined in the Recognition Plan, all shares
subject to an award held by a recipient shall be deemed earned as of the
recipient's last day of employment with or service to the Company or any
subsidiary and shall be distributed as soon as practicable thereafter,
provided that as of the date of such retirement, such treatment is either
authorized or is not prohibited by applicable laws and regulations. All
shares subject to an award held by a recipient also shall be deemed to be
earned in the event of a change in control of the Company, as defined in the
Recognition Plan, provided that as of the date of such change in control of
the Company, such treatment is either authorized or is not prohibited by
applicable laws and regulations.
During the lifetime of the recipient, shares subject to an award may only
be earned by and paid to the recipient, provided that shares subject to an
award and rights to such
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shares shall be transferable by a recipient to his or her spouse, lineal
ascendants, lineal descendants, or to a duly established trust. Shares
subject to an award so transferred may not again be transferred other than to
the recipient who originally received the grant or to an individual or trust
to whom such recipient could have transferred shares subject to an award.
Shares subject to awards which are transferred shall be subject to the same
terms and conditions as would have applied to such shares subject to awards
in the hands of the recipient who originally received the grant.
Federal Income Tax Consequences. Pursuant to Section 83 of the Code,
recipients of Recognition Plan awards will recognize ordinary income in an
amount equal to the fair market value of the shares of Common Stock granted
to them at the time that the shares vest and become transferable. A recipient
of a Recognition Plan award may also elect, however, to accelerate the
recognition of income with respect to his or her grant to the time when
shares of Common Stock are first transferred to him or her, notwithstanding
the vesting schedule of such awards. The Company will be entitled to deduct
as a compensation expense for tax purposes the same amounts recognized as
income by recipients of Recognition Plan awards in the year in which such
amounts are included in income.
Accounting Treatment. For accounting purposes, the Company will also
recognize a compensation expense as shares of Common Stock granted pursuant
to the Recognition Plan vest. Unlike the treatment of Recognition Plan
awards for tax purposes, however, the compensation expense recognized for
accounting purposes is limited to the fair market value of the Common Stock
at the date of grant to recipients, rather than the fair market value of the
Common Stock at the time that a Recognition Plan grant vests.
Stockholder Approval. No shares will be granted under the Recognition
Plan unless the Recognition Plan is approved by stockholders. Stockholder
ratification of the Recognition Plan will satisfy certain NNM listing and OTS
requirements.
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Shares to be Granted. The Board of Directors of the Company adopted the
Recognition Plan and approved the grant of shares to executive officers and
employees of the Company and the Association and non-employee directors
thereof. The awards shall be effective upon stockholder approval of the
Recognition Plan. The following table sets forth certain information with
respect to such grants.
Name of Individual or Number of Shares
Number of Persons in Group Title Awarded(1)
- -------------------------- ----- -----------------
Donald C. Scott President and Chief 34,385
Executive Officer
Bruce A. Scott Executive Vice President 34,385
All executive officers as --- (2)
a group (4 persons)
All non-employee directors --- 41,262
as a group (7 persons)
All employees, not --- (2)
including executive
officers, as a group
(29 persons)
________________________________
(1) The above grants of restricted stock to all recipients will vest over
five years at the rate of 20% per year commencing on the first anniversary of
the date of grant.
(2) The number of shares to be awarded to the executive officers as a group
(4 persons) and all employees, not including executive officers, as a group
(29 persons) has not been determined.
The Board of Directors recommends that stockholders vote FOR adoption of
the Recognition and Retention Plan and Trust.
ADJOURNMENT OF SPECIAL MEETING
Each proxy solicited hereby requests authority to vote for an adjournment
of the Special Meeting, if an adjournment is deemed to be necessary. The
Company may seek an adjournment of the Special Meeting for not more than 30
days in order to enable the Company to solicit additional votes in favor of
the proposals to adopt the Stock Option Plan and/or the Recognition Plan in
the event that either or both of such proposals have not received the
requisite vote of stockholders at the Special Meeting and either or both of
such
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proposals have not received the negative votes of the holders of a majority
of the Company's Common Stock. If the Company desires to adjourn the meeting
with respect to either or both of the foregoing proposals, it will request a
motion that the meeting be adjourned for up to 30 days with respect to such
proposal or proposals (and solely with respect to such proposal or proposals,
provided that a quorum is present at the Special Meeting), and no vote will
be taken on such proposal(s) at the originally scheduled Special Meeting.
Each proxy solicited hereby, if properly signed and returned to the Company
and not revoked prior to its use, will be voted on any motion for adjournment
in accordance with the instructions contained therein. If no contrary
instructions are given, each proxy received will be voted in favor of any
motion to adjourn the meeting. Unless revoked prior to its use, any proxy
solicited for the Special Meeting will continue to be valid for any
adjournment of the Special Meeting, and will be voted in accordance with
instructions contained therein, and if no contrary instructions are given,
for the proposal(s) in question.
Any adjournment will permit the Company to solicit additional proxies and
will permit a greater expression of the stockholders' views with respect to
such proposal(s). Such an adjournment would be disadvantageous to
stockholders who are against the proposal(s), because an adjournment will
give the Company additional time to solicit favorable votes and thus increase
the chances of passing such proposal(s).
If a quorum is not present at the Special Meeting, no proposal will be
acted upon and the Board of Directors of the Company will adjourn the Special
Meeting to a later date in order to solicit additional proxies on each of the
proposals being submitted to stockholders.
An adjournment for up to 30 days will not require either the setting of a
new record date or notice of the adjourned meeting as in the case of an
original meeting. The Company has no reason to believe that an adjournment
of the Special Meeting will be necessary at this time.
Because the Board of Directors recommends that stockholders vote FOR the
proposals to adopt the Stock Option Plan and Recognition Plan, as discussed
above, the Board of Directors recommends that stockholders vote FOR the
possible adjournment of the Special Meeting. The holders of a majority of
the Company's Common Stock present, in person or by proxy, at the Special
Meeting will be required to approve a motion to adjourn the Special Meeting.
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MANAGEMENT COMPENSATION
Summary Compensation Table
The following table sets forth a summary of certain information
concerning the compensation paid by the Association for services rendered in
all capacities during the years ended December 31, 1995 and 1996 to the
President and Chief Executive Officer of the Association, and the Executive
Vice President and Vice President who were the only other executive officers
of the Association who had total annual compensation in excess of $100,000
during fiscal 1996.
Annual Compensation
----------------------------------------
Other
Name and Annual
Principal Position Year Salary Bonus Compensation(1)
- ------------------ ---- ------ ----- ----------------
Donald C. Scott 1996 $100,600 $36,004 $16,413
President and Chief 1995 97,127 16,552 13,642
Executive Officer
Bruce A. Scott 1996 91,900 32,857 14,971
Executive Vice President 1995 88,650 15,106 12,451
Ralph E. Weber 1996 75,886 27,124 12,361
Vice President 1995 73,536 12,496 10,324
_______________
(1) Amounts reflect the Association's contribution to its defined
contributory pension plan on behalf of the employee. See "-Defined
Contributory Pension Plan." Annual compensation does not include amounts
attributable to other miscellaneous benefits received by the executive
officers. The costs to the Association of providing such other
miscellaneous benefits during 1996 did not exceed 10% of the total salary
and bonus paid to or accrued for the benefit of such individual executive
officer.
Compensation of Directors
Members of the Company's Board of Directors receive no compensation for
attending meetings of the Board. Members of the Board of Directors of the
Association are paid $700 for each Board meeting regardless of attendance and
$500 for each Audit Committee meeting attended and $200 for each Compensation
Committee meeting attended.
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Employment and Severance Agreements
The Company and the Association (collectively the "Employers") have
entered into employment agreements with Messrs. Donald Scott and Bruce Scott.
The Employers have agreed to employ Messrs. Donald Scott and Bruce Scott
each for a term of three years in their current positions at their current
base salaries of $125,000 and $120,000, respectively. At least 30 days prior
to each annual anniversary date of each of the employment agreements, the
Boards of Directors of the Company and the Association shall determine
whether or not to extend the term of each agreement for an additional one
year. Any party may elect not to extend the agreements for an additional
year by providing written notice at least 30 days prior to any annual
anniversary date.
The agreements are terminable with or without cause by the Employers.
The officers shall have no right to compensation or other benefits pursuant
to the employment agreements for any period after voluntary termination or
termination by the Employers for cause, disability, retirement or death,
provided, however, that (i) in the event that an officer terminates his
employment because of failure of the Employers to comply with any material
provision of the employment agreements or (ii) the employment agreement is
terminated by the Employers other than for cause, disability, retirement or
death or by the officer as a result of certain adverse actions which are
taken with respect to the officer's employment following a Change in Control
of the Company, as defined, Messrs. Donald Scott and Bruce Scott will each be
entitled to cash severance payments equal to three times his average annual
compensation over his most recent five taxable years. In addition, the
officer will be entitled to a continuation of benefits similar to those he is
receiving at the time of such termination for the period otherwise remaining
under the term of the agreement or until he obtains full-time employment with
another employer, whichever occurs first.
A Change in Control is generally defined in the employment agreement to
include any change in control required to be reported under the federal
securities laws, as well as (i) the acquisition by any person of 25% or more
of the Company's outstanding voting securities and (ii) a change in a
majority of the directors of the Company during any two-year period without
the approval of at least two-thirds of the persons who were directors of the
Company at the beginning of such period.
The employment agreements provide that in the event that any payments to
be paid thereunder are deemed to constitute a "parachute payment" within the
meaning of Section 280G of the Code, then such payments and benefits received
thereunder shall be reduced, in the manner determined by the employee, by the
amount, if any, which is the minimum necessary to result in no portion of the
payments and benefits being non-deductible by the Employers for federal
income tax purposes. Parachute payments generally are payments equal to or
exceeding three times the base amount, which is defined to mean the
recipient's average annual compensation from the employer includable in the
recipient's gross income during the most recent five taxable years ending
before the date on which a change in control of the employer occurred.
Recipients of parachute payments are subject to a 20%
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excise tax on the amount by which such payments exceed the base amount, in
addition to regular income taxes, and payments in excess of the base amount
are not deductible by the employer as compensation expense for federal income
tax purposes.
Benefits
Defined Contributory Pension Plan. The Association maintains a
Simplified Employee Pension-Individual Retirement Account Agreement (the
"SEP-IRA") for its employees. Each employee who (i) is at least age 18 and
(ii) has performed services for the Association in at least one year of the
immediately preceding five years is eligible to participate. The Association
may make discretionary contributions to participants' accounts on an annual
basis. During 1996 and 1995, the Association made contributions to the
SEP-IRA in amounts equaling 12% of participants' compensation. The
Association's contributions to the SEP-IRA amounted to $140,424 for 1996.
Participants are immediately vested in employer contributions as well as
their elective deferrals and may withdraw either at any time. Amounts
withdrawn, however, are includable in a participant's income and may be
subject to a 10% penalty tax. The SEP-IRA was terminated effective January
1, 1997.
Transactions With Certain Related Persons
The Company's and Association's policies provide that all loans made by
the Association to the directors, officers and employees of the Company and
the Association are made in the ordinary course of business, are made on
substantially the same terms, including interest rates and collateral, as
those prevailing at the time for comparable transactions with other persons
and do not involve more than the normal risk of collectibility or present
other unfavorable features. All such loans outstanding as of December 31,
1996 were made by the Association in the ordinary course of business and were
not made with favorable terms nor did they involve more than the normal risk
of collectibility. The Company believes that such loans do not involve more
than the normal risk of collectibility.
STOCKHOLDER PROPOSALS
Any proposal which a stockholder wishes to have included in the proxy
materials of the Company relating to the first annual meeting of stockholders
of the Company, which is scheduled to be held in April, 1998, must be
received at the principal executive offices of the Company, 3798 Veterans
Memorial Boulevard, Metairie, Louisiana 70002, Attention: Lettie R. Moll,
Corporate Secretary, no later than November 28, 1997. If such proposal is in
compliance with all of the requirements of Rule 14a-8 under the Exchange Act,
it will be included in the proxy statement and set forth on the form of proxy
issued for such annual meeting of stockholders. It is urged that any such
proposals be sent certified mail, return receipt requested.
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OTHER MATTERS
Management is not aware of any business to come before the Special
Meeting other than the matters described above in this Proxy Statement.
However, if any other matters should properly come before the meeting, it is
intended that the proxies solicited hereby will be voted with respect to
those other matters in accordance with the judgment of the persons voting the
proxies.
The cost of the solicitation of proxies will be borne by the Company.
The Company has retained Regan & Associates, Inc., a professional proxy
solicitation firm, to assist in the solicitation of proxies. Such firm will
be paid a fee of $4,000 which amount will be renegotiated in the event of a
proxy contest, plus reimbursement for out-of-pocket expenses. The Company
will reimburse brokerage firms and other custodians, nominees and fiduciaries
for reasonable expenses incurred by them in sending the proxy materials to
the beneficial owners of the Company's Common Stock. In addition to
solicitations by mail, directors, officers and employees of the Company may
solicit proxies personally or by telephone without additional compensation.
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APPENDIX A
GS FINANCIAL CORP.
1997 STOCK OPTION PLAN
ARTICLE I
ESTABLISHMENT OF THE PLAN
GS Financial Corp. (the "Corporation") hereby establishes this 1997 Stock
Option Plan (the "Plan") upon the terms and conditions hereinafter stated.
ARTICLE II
PURPOSE OF THE PLAN
The purpose of this Plan is to improve the growth and profitability of
the Corporation and Guaranty Savings and Homestead Association (the
"Association") by providing Employees and Non-Employee Directors with a
proprietary interest in the Corporation as an incentive to contribute to the
success of the Corporation and its Subsidiary Companies, and rewarding
Employees for outstanding performance. All Incentive Stock Options issued
under this Plan are intended to comply with the requirements of Section 422
of the Code, and the regulations thereunder, and all provisions hereunder
shall be read, interpreted and applied with that purpose in mind.
ARTICLE III
DEFINITIONS
3.01 "Association" means Guaranty Savings and Homestead Association, the
wholly owned subsidiary of the Corporation.
3.02 "Award" means an Option or Stock Appreciation Right granted pursuant
to the terms of this Plan.
3.03 "Board" means the Board of Directors of the Corporation.
3.04 "Change in Control of the Corporation" shall mean a change in
control of a nature that would be required to be reported in response to Item
6(e) of Schedule 14A of Regulation 14A promulgated under the Exchange Act,
whether or not the Corporation in fact is required to comply with Regulation
14A thereunder; provided that, without limitation, such a change in control
shall be deemed to have occurred if (i) any "person" (as such term is used in
Sections 13(d) and 14(d) of the Exchange Act), other than the Corporation, is
or becomes the "beneficial owner" (as defined in Rule 13d-3 under the
Exchange Act), directly or indirectly, of securities of the Corporation
representing 25% or more of the combined voting power of the Corporation's
then outstanding securities, or (ii) during any period of
<PAGE>
twenty-four consecutive months during the term of an Award, individuals who
at the beginning of such period constitute the Board of Directors, and any
new director whose election by the Board of Directors or nomination for
election by the Corporation's stockholders was approved by a vote of at least
two-thirds of the directors then still in office who either were directors at
the beginning of the two-year period or whose election or nomination for
election was previously so approved, cease for any reason to constitute at
least a majority of the Board of Directors; (iii) the stockholders of the
Corporation approve a merger or consolidation of the Corporation with any
other corporation, other than a merger or consolidation that would result in
the voting securities of the Corporation outstanding immediately prior
thereto continuing to represent (either by remaining outstanding or by being
converted into voting securities of the surviving entity) more than 50% of
the combined voting power of the voting securities of the Corporation
outstanding immediately after such merger or consolidation; or (iv) the
stockholders of the Corporation approve a plan of complete liquidation of the
Corporation or an agreement for the sale or disposition by the Corporation of
all or substantially all of the Corporation's assets. If any of the events
enumerated in clauses (i) through (iv) occur, the Board shall determine the
effective date of the Change in Control resulting therefrom for purposes of
the Plan.
3.05 "Code" means the Internal Revenue Code of 1986, as amended.
3.06 "Committee" means a committee of two or more directors appointed by
the Board pursuant to Article IV hereof, each of whom shall be a Non-Employee
Director as defined in Rule 16b-3(b)(3)(i) of the Exchange Act or any
successor thereto.
3.07 "Common Stock" means shares of the common stock, $.01 par value per
share, of the Corporation.
3.08 "Disability" means any physical or mental impairment which qualifies
an individual for disability benefits under the applicable long-term
disability plan maintained by the Corporation or a Subsidiary Company, or, if
no such plan applies, which would qualify such individual for disability
benefits under any long-term disability plan maintained by the Corporation,
if such individual were covered by that plan.
3.09 "Effective Date" means the day upon which the Board approves this
Plan.
3.10 "Employee" means any person who is employed by the Corporation or a
Subsidiary Company, or is an Officer of the Corporation or a Subsidiary
Company, but not including directors who are not also Officers of or
otherwise employed by the Corporation or a Subsidiary Company.
3.11 "Exchange Act" means the Securities Exchange Act of 1934, as amended.
3.12 "Fair Market Value" shall be equal to the fair market value per share
of the Corporation's Common Stock on the date an Award is granted. For
purposes hereof, the
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Fair Market Value of a share of Common Stock shall be the closing sale price
of a share of Common Stock on the date in question (or, if such day is not a
trading day in the U.S. markets, on the nearest preceding trading day), as
reported with respect to the principal market (or the composite of the
markets, if more than one) or national quotation system in which such shares
are then traded, or if no such closing prices are reported, the mean between
the high bid and low asked prices that day on the principal market or
national quotation system then in use, or if no such quotations are
available, the price furnished by a professional securities dealer making a
market in such shares selected by the Committee.
3.13 "Incentive Stock Option" means any Option granted under this Plan
which the Board intends (at the time it is granted) to be an incentive stock
option within the meaning of Section 422 of the Code or any successor thereto.
3.14 "Non-Employee Director" means a member of the Board of the
Corporation or Board of Directors of the Association or any Subsidiary
Company, including a Director Emeritus of the Board of Directors of the
Corporation or the Board of Directors of the Association, who is not an
Officer or Employee of the Corporation or any Subsidiary Company.
3.15 "Non-Qualified Option" means any Option granted under this Plan
which is not an Incentive Stock Option.
3.16 "Offering" means the offering of Common Stock to the public pursuant
to the conversion of the Association to the stock form in April 1997.
3.17 "Officer" means an Employee whose position in the Corporation or
Subsidiary Company is that of a corporate officer, as determined by the Board.
3.18 "Option" means a right granted under this Plan to purchase Common
Stock.
3.19 "Optionee" means an Employee or Non-Employee Director or former
Employee or Non-Employee Director to whom an Option is granted under the Plan.
3.20 "Retirement" means a termination of employment which onstitutes a
"retirement" under any applicable qualified pension benefit plan maintained
by the Corporation or a Subsidiary Corporation, or, if no such plan is
applicable, which would constitute "retirement" under the Corporation's
pension benefit plan, if such individual were a participant in that plan.
3.21 "Stock Appreciation Right" means a right to surrender an Option in
consideration for a payment by the Corporation in cash and/or Common Stock,
as provided in the discretion of the Committee in accordance with Section
8.11.
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3.22 "Subsidiary Companies" means those subsidiaries of the Corporation,
including the Association, which meet the definition of "subsidiary
corporations" set forth in Section 425(f) of the Code, at the time of
granting of the Option in question.
ARTICLE IV
ADMINISTRATION OF THE PLAN
4.01 Duties of the Committee. The Plan shall be administered and
interpreted by the Committee, as appointed from time to time by the Board
pursuant to Section 4.02. The Committee shall have the authority to adopt,
amend and rescind such rules, regulations and procedures as, in its opinion,
may be advisable in the administration of the Plan, including, without
limitation, rules, regulations and procedures which (i) deal with
satisfaction of an Optionee's tax withholding obligation pursuant to Section
12.02 hereof, (ii) include arrangements to facilitate the Optionee's ability
to borrow funds for payment of the exercise or purchase price of an Award, if
applicable, from securities brokers and dealers, and (iii) include
arrangements which provide for the payment of some or all of such exercise or
purchase price by delivery of previously-owned shares of Common Stock or
other property and/or by withholding some of the shares of Common Stock which
are being acquired. The interpretation and construction by the Committee of
any provisions of the Plan, any rule, regulation or procedure adopted by it
pursuant thereto or of any Award shall be final and binding in the absence of
action by the Board.
4.02 Appointment and Operation of the Committee. The members of the
Committee shall be appointed by, and will serve at the pleasure of, the
Board. The Board from time to time may remove members from, or add members
to, the Committee, provided the Committee shall continue to consist of two or
more members of the Board, each of whom shall be a Non-Employee Director, as
defined in Rule 16b-3(b)(3)(i) of the Exchange Act or any successor thereto.
The Committee shall act by vote or written consent of a majority of its
members. Subject to the express provisions and limitations of the Plan, the
Committee may adopt such rules, regulations and procedures as it deems
appropriate for the conduct of its affairs. It may appoint one of its
members to be chairman and any person, whether or not a member, to be its
secretary or agent. The Committee shall report its actions and decisions to
the Board at appropriate times but in no event less than one time per
calendar year.
4.03 Revocation for Misconduct. The Board or the Committee may by
resolution immediately revoke, rescind and terminate any Option, or portion
thereof, to the extent not yet vested, or any Stock Appreciation Right, to
the extent not yet exercised, previously granted or awarded under this Plan
to an Employee who is discharged from the employ of the Corporation or a
Subsidiary Company for cause, which, for purposes hereof, shall mean
termination because of the Employee's personal dishonesty, incompetence,
willful misconduct, breach of fiduciary duty involving personal profit,
intentional failure to perform stated duties, willful violation of any law,
rule, or regulation (other than traffic violations or similar offenses) or
final cease-and-desist order. Options granted to a Non-Employee
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Director who is removed for cause pursuant to the Corporation's Articles of
Incorporation and Bylaws or the Association's Charter and Bylaws shall
terminate as of the effective date of such removal.
4.04 Limitation on Liability. Neither the members of the Board nor any
member of the Committee shall be liable for any action or determination made
in good faith with respect to the Plan, any rule, regulation or procedure
adopted by it pursuant thereto or any Awards granted under it. If a member
of the Board or the Committee is a party or is threatened to be made a party
to any threatened, pending or completed action, suit or proceeding, whether
civil, criminal, administrative or investigative, by reason of anything done
or not done by him in such capacity under or with respect to the Plan, the
Corporation shall, subject to the requirements of applicable laws and
regulations, indemnify such member against all liabilities and expenses
(including attorneys' fees), judgments, fines and amounts paid in settlement
actually and reasonably incurred by him in connection with such action, suit
or proceeding if he acted in good faith and in a manner he reasonably
believed to be in the best interests of the Corporation and its Subsidiary
Companies and, with respect to any criminal action or proceeding, had no
reasonable cause to believe his conduct was unlawful.
4.05 Compliance with Law and Regulations. All Awards granted hereunder
shall be subject to all applicable federal and state laws, rules and
regulations and to such approvals by any government or regulatory agency as
may be required. The Corporation shall not be required to issue or deliver
any certificates for shares of Common Stock prior to the completion of any
registration or qualification of or obtaining of consents or approvals with
respect to such shares under any federal or state law or any rule or
regulation of any government body, which the Corporation shall, in its sole
discretion, determine to be necessary or advisable. Moreover, no Option or
Stock Appreciation Right may be exercised if such exercise would be contrary
to applicable laws and regulations.
4.06 Restrictions on Transfer. The Corporation may place a legend upon
any certificate representing shares acquired pursuant to an Award granted
hereunder noting that the transfer of such shares may be restricted by
applicable laws and regulations.
ARTICLE V
ELIGIBILITY
Awards may be granted to such Employees or Non-Employee Directors of the
Corporation and its Subsidiary Companies as may be designated from time to
time by the Board or the Committee. Awards may not be granted to individuals
who are not Employees or Non-Employee Directors of either the Corporation or
its Subsidiary Companies. Non-Employee Directors shall be eligible to
receive only Awards of Non-Qualified Options.
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ARTICLE VI
COMMON STOCK COVERED BY THE PLAN
6.01 Option Shares. The aggregate number of shares of Common Stock which
may be issued pursuant to this Plan, subject to adjustment as provided in
Article IX, shall be 343,850, which is equal to 10.0% of the shares of Common
Stock issued in the Offering. None of such shares shall be the subject of
more than one Award at any time, but if an Option as to any shares is
surrendered before exercise, or expires or terminates for any reason without
having been exercised in full, or for any other reason ceases to be
exercisable, the number of shares covered thereby shall again become
available for grant under the Plan as if no Awards had been previously
granted with respect to such shares. Notwithstanding the foregoing, if an
Option is surrendered in connection with the exercise of a Stock Appreciation
Right, the number of shares covered thereby shall not be available for grant
under the Plan.
6.02 Source of Shares. The shares of Common Stock issued under the Plan
may be authorized but unissued shares, treasury shares or shares purchased by
the Corporation on the open market or from private sources for use under the
Plan.
ARTICLE VII
DETERMINATION OF
AWARDS, NUMBER OF SHARES, ETC.
The Board or the Committee shall, in its discretion, determine from time
to time which Employees and Non-Employee Directors will be granted Awards
under the Plan, the number of shares of Common Stock subject to each Award,
whether each Option will be an Incentive Stock Option or a Non-Qualified
Stock Option and the exercise price of an Option. In making all such
determinations there shall be taken into account the duties, responsibilities
and performance of each respective Employee, his present and potential
contributions to the growth and success of the Corporation, his salary and
such other factors deemed relevant to accomplishing the purposes of the Plan.
ARTICLE VIII
OPTIONS AND STOCK APPRECIATION RIGHTS
Each Option granted hereunder shall be on the following terms and
conditions:
8.01 Stock Option Agreement. The proper Officers on behalf of the
Corporation and each Optionee shall execute a Stock Option Agreement which
shall set forth the total number of shares of Common Stock to which it
pertains, the exercise price, whether it is a Non-Qualified Option or an
Incentive Stock Option, and such other terms, conditions, restrictions and
privileges as the Board or the Committee in each instance shall deem
appropriate, provided they are not inconsistent with the terms, conditions
and provisions of this Plan. Each Optionee shall receive a copy of his
executed Stock Option Agreement.
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8.02 Awards to Employee and Non-Employee Directors. Specific Awards to
Employees and Non-Employee Directors shall be made to such persons and in
such amounts as are determined by the Board of Directors or the Committee.
However, the aggregate amount of Awards made to all Non-Employee Directors
may not exceed 103,155 shares (or 30% of the number of shares available under
this Plan), no individual Non-Employee Director may receive Awards in excess
of 17,192 shares (or 5% of the number of shares available under this Plan)
and no individual Employee may receive Awards in excess of 85,962 shares (or
25% of the number of shares available under this Plan).
8.03 Option Exercise Price.
(a) Incentive Stock Options. The per share price at which the
subject Common Stock may be purchased upon exercise of an Incentive Stock
Option shall be no less than one hundred percent (100%) of the Fair Market
Value of a share of Common Stock at the time such Incentive Stock Option is
granted, except as provided in Section 8.10(b), and subject to any applicable
adjustment pursuant to Article IX hereof.
(b) Non-Qualified Options. The per share price at which the
subject Common Stock may be purchased upon exercise of a Non-Qualified Option
shall be no less than one hundred percent (100%) of the Fair Market Value of
a share of Common Stock at the time such Non-Qualified Option is granted, and
subject to any applicable adjustment pursuant to Article IX hereof.
8.04 Vesting and Exercise of Options.
(a) General Rules. Incentive Stock Options and Non-Qualified
Options granted hereunder shall become vested and exercisable at the rate of
20% per year over five years, commencing one year from the date of grant and
an additional 20% shall vest on each successive annual anniversary of the
date the Option was granted, and the right to exercise shall be cumulative.
Notwithstanding the foregoing, no vesting shall occur on or after an
Employee's employment or service as a Non-Employee Director with the
Corporation and all Subsidiary Companies is terminated for any reason other
than his death or Disability. In determining the number of shares of Common
Stock with respect to which Options are vested and/or exercisable, fractional
shares will be rounded up to the nearest whole number if the fraction is 0.5
or higher, and down if it is less.
(b) Accelerated Vesting. Unless the Committee shall specifically
state otherwise at the time an Option is granted, all Options granted under
this Plan shall become vested and exercisable in full on the date an Optionee
terminates his employment with the Corporation or a Subsidiary Company or
service as a Non-Employee Director because of his death or Disability. All
Options hereunder shall become immediately vested and exercisable in full on
the date an Optionee terminates his employment with the Corporation or a
Subsidiary Company or service as a Non-Employee Director due to Retirement or
there occurs a Change in Control of the Corporation if, as of such date of
such Retirement or
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Change in Control of the Corporation, such treatment is either authorized or
is not prohibited by applicable laws and regulations.
8.05 Duration of Options.
(a) General Rule. Except as provided in Sections 8.05(b) and 8.10,
each Option or portion thereof granted to an Optionee shall be exercisable at
any time on or after it vests and becomes exercisable until the earlier of
(i) ten (10) years after its date of grant or (ii) three (3) months after the
date on which the Optionee ceases to be employed by the Corporation and all
Subsidiary Companies or serve as a Non-Employee Director, unless the Board or
the Committee in its discretion decides at the time of grant or thereafter to
extend such period of exercise upon termination of employment or service from
three (3) months to a period not exceeding five (5) years.
(b) Exceptions. If an Employee dies while in the employ of the
Corporation or a Subsidiary Company or terminates employment with the
Corporation or a Subsidiary Company as a result of Disability without having
fully exercised his Options, the Optionee or the executors, administrators,
legatees or distributees of his estate shall have the right, during the
twelve-month period following the earlier of his death or termination due to
Disability, to exercise such Options. If a Non-Employee Director dies while
serving as a Non-Employee Director or terminates his service to the
Corporation or a Subsidiary Company as a result of Disability without having
fully exercised his Options, the Non-Employee Director or the executors,
administrators, legatees or distributees of his estate shall have the right,
during the twelve-month period following the earlier of his death or
termination due to Disability, to exercise such Options. In no event,
however, shall any Option be exercisable more than ten (10) years from the
date it was granted. In the event of Retirement, an Employee or Non-Employee
Director shall be entitled to the same time period set forth above in this
Section 8.05(b) to exercise an Option if, as of the date of such Retirement,
such treatment is either authorized or is not prohibited by applicable laws
and regulations.
8.06 Nonassignability. Options shall not be transferable by an Optionee
except by will or the laws of descent or distribution, and during an
Optionee's lifetime shall be exercisable only by such Optionee or the
Optionee's guardian or legal representative. Notwithstanding the foregoing,
or any other provision of this Plan, an Optionee who holds Non-Qualified
Options may transfer such Options to his or her spouse, lineal ascendants,
lineal descendants, or to a duly established trust for the benefit of one or
more of these individuals. Options so transferred may thereafter be
transferred only to the Optionee who originally received the grant or to an
individual or trust to whom the Optionee could have initially transferred the
Option pursuant to this Section 8.06. Options which are transferred pursuant
to this Section 8.06 shall be exercisable by the transferee according to the
same terms and conditions as applied to the Optionee.
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8.07 Manner of Exercise. Options may be exercised in part or in whole
and at one time or from time to time. The procedures for exercise shall be
set forth in the written Stock Option Agreement provided for in Section 8.01
above.
8.08 Payment for Shares. Payment in full of the purchase price for
shares of Common Stock purchased pursuant to the exercise of any Option shall
be made to the Corporation upon exercise of the Option. All shares sold under
the Plan shall be fully paid and nonassessable. Payment for shares may be
made by the Optionee in cash or, at the discretion of the Board or the
Committee, by delivering shares of Common Stock (including shares acquired
pursuant to the exercise of an Option) or other property equal in Fair Market
Value to the purchase price of the shares to be acquired pursuant to the
Option, by withholding some of the shares of Common Stock which are being
purchased upon exercise of an Option, or any combination of the foregoing.
8.09 Voting and Dividend Rights. No Optionee shall have any voting or
dividend rights or other rights of a stockholder in respect of any shares of
Common Stock covered by an Option prior to the time that his name is recorded
on the Corporation's stockholder ledger as the holder of record of such
shares acquired pursuant to an exercise of an Option.
8.10 Additional Terms Applicable to Incentive Stock Options. All Options
issued under the Plan as Incentive Stock Options will be subject, in addition
to the terms detailed in Sections 8.01 to 8.09 above, to those contained in
this Section 8.10.
(a) Notwithstanding any contrary provisions contained elsewhere in
this Plan and as long as required by Section 422 of the Code, the aggregate
Fair Market Value, determined as of the time an Incentive Stock Option is
granted, of the Common Stock with respect to which Incentive Stock Options
are exercisable for the first time by the Optionee during any calendar year
under this Plan, and stock options that satisfy the requirements of Section
422 of the Code under any other stock option plan or plans maintained by the
Corporation (or any parent or Subsidiary Company), shall not exceed $100,000.
(b) Limitation on Ten Percent Stockholders. The price at which
shares of Common Stock may be purchased upon exercise of an Incentive Stock
Option granted to an individual who, at the time such Incentive Stock Option
is granted, owns, directly or indirectly, more than ten percent (10%) of the
total combined voting power of all classes of stock issued to stockholders of
the Corporation or any Subsidiary Company, shall be no less than one hundred
and ten percent (110%) of the Fair Market Value of a share of the Common
Stock of the Corporation at the time of grant, and such Incentive Stock
Option shall by its terms not be exercisable after the earlier of the date
determined under Section 8.04 or the expiration of five (5) years from the
date such Incentive Stock Option is granted.
(c) Notice of Disposition; Withholding; Escrow. An Optionee shall
immediately notify the Corporation in writing of any sale, transfer,
assignment or other disposition (or action constituting a disqualifying
disposition within the meaning of Section
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421 of the Code) of any shares of Common Stock acquired through exercise of
an Incentive Stock Option, within two (2) years after the grant of such
Incentive Stock Option or within one (1) year after the acquisition of such
shares, setting forth the date and manner of disposition, the number of
shares disposed of and the price at which such shares were disposed of. The
Corporation shall be entitled to withhold from any compensation or other
payments then or thereafter due to the Optionee such amounts as may be
necessary to satisfy any withholding requirements of federal or state law or
regulation and, further, to collect from the Optionee any additional amounts
which may be required for such purpose. The Committee may, in its
discretion, require shares of Common Stock acquired by an Optionee upon
exercise of an Incentive Stock Option to be held in an escrow arrangement for
the purpose of enabling compliance with the provisions of this Section
8.10(c).
8.11 Stock Appreciation Rights.
(a) General Terms and Conditions. The Board or the Committee may,
but shall not be obligated to, authorize the Corporation, on such terms and
conditions as it deems appropriate in each case, to grant rights to Optionees
to surrender an exercisable Option, or any portion thereof, in consideration
for the payment by the Corporation of an amount equal to the excess of the
Fair Market Value of the shares of Common Stock subject to the Option, or
portion thereof, surrendered over the exercise price of the Option with
respect to such shares (any such authorized surrender and payment being
hereinafter referred to as a "Stock Appreciation Right"). Such payment, at
the discretion of the Board or the Committee, may be made in shares of Common
Stock valued at the then Fair Market Value thereof, or in cash, or partly in
cash and partly in shares of Common Stock.
The terms and conditions set with respect to a Stock Appreciation Right
may include (without limitation), subject to other provisions of this Section
8.11 and the Plan: the period during which, date by which or event upon which
the Stock Appreciation Right may be exercised (which shall be on the same
terms as the option to which it relates pursuant to Section 8.04 hereunder);
the method for valuing shares of Common Stock for purposes of this Section
8.11; a ceiling on the amount of consideration which the Corporation may pay
in connection with exercise and cancellation of the Stock Appreciation Right;
and arrangements for income tax withholding. The Board or the Committee
shall have complete discretion to determine whether, when and to whom Stock
Appreciation Rights may be granted.
(b) Time Limitations. If a holder of a Stock Appreciation Right
terminates service with the Corporation as an Officer or Employee, the Stock
Appreciation Right may be exercised only within the period, if any, within
which the Option to which it relates may be exercised.
(c) Effects of Exercise of Stock Appreciation Rights or Options.
Upon the exercise of a Stock Appreciation Right, the number of shares of
Common Stock available under the Option to which it relates shall decrease by
a number equal to the number of shares for which the Stock Appreciation Right
was exercised. Upon the exercise of an
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Option, any related Stock Appreciation Right shall terminate as to any number
of shares of Common Stock subject to the Stock Appreciation Right that
exceeds the total number of shares for which the Option remains unexercised.
(d) Time of Grant. A Stock Appreciation Right granted in
connection with an Incentive Stock Option must be granted concurrently with
the Option to which it relates, while a Stock Appreciation Right granted in
connection with a Non-Qualified Option may be granted concurrently with the
Option to which it relates or at any time thereafter prior to the exercise or
expiration of such Option.
(e) Non-Transferable. The holder of a Stock Appreciation Right may
not transfer or assign the Stock Appreciation Right otherwise than by will or
in accordance with the laws of descent and distribution, and during a
holder's lifetime a Stock Appreciation Right may be exercisable only by the
holder.
ARTICLE IX
ADJUSTMENTS FOR CAPITAL CHANGES
The aggregate number of shares of Common Stock available for issuance
under this Plan, the number of shares to which any outstanding Award relates,
the maximum number of shares that can be covered by Award to each Employee
and each Non-Employee Director and the exercise price per share of Common
Stock under any outstanding Option shall be proportionately adjusted for any
increase or decrease in the total number of outstanding shares of Common
Stock issued subsequent to the effective date of this Plan resulting from a
split, subdivision or consolidation of shares or any other capital
adjustment, the payment of a stock dividend, or other increase or decrease in
such shares effected without receipt or payment of consideration by the
Corporation. If, upon a merger, consolidation, reorganization, liquidation,
recapitalization or the like of the Corporation, the shares of the
Corporation's Common Stock shall be exchanged for other securities of the
Corporation or of another corporation, each recipient of an Award shall be
entitled, subject to the conditions herein stated, to purchase or acquire
such number of shares of Common Stock or amount of other securities of the
Corporation or such other corporation as were exchangeable for the number of
shares of Common Stock of the Corporation which such optionees would have
been entitled to purchase or acquire except for such action, and appropriate
adjustments shall be made to the per share exercise price of outstanding
Options. Notwithstanding any provision to the contrary, the exercise price
of shares subject to outstanding Awards may be proportionately adjusted upon
the payment of a special large and nonrecurring dividend that has the effect
of a return of capital to the stockholders, provided that the adjustments to
the per shares exercise price shall satisfy the criteria set forth in
Emerging Issues Task Force 90-9 (or any successor thereto) so that the
adjustments do not result in compensation expense, and provided further that
if such adjustment with respect to incentive stock options would be treated
as a modification of the outstanding incentive stock options with the effect
that, for purposes of Section 422 and 425(h) of the Code, and the rules and
regulations thereunder, new incentive stock options would be
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deemed to be granted, then no adjustment to the per share exercise price of
outstanding incentive stock options shall be made.
ARTICLE X
AMENDMENT AND TERMINATION OF THE PLAN
The Board may, by resolution, at any time terminate or amend the Plan
with respect to any shares of Common Stock as to which Awards have not been
granted, subject to any applicable regulatory requirements, required
stockholder approval or any stockholder approval which the Board may deem to
be advisable for any reason, such as for the purpose of obtaining or
retaining any statutory or regulatory benefits under tax, securities or other
laws or satisfying any applicable stock exchange listing requirements. The
Board may not, without the consent of the holder of an Award, alter or impair
any Award previously granted or awarded under this Plan as specifically
authorized herein.
ARTICLE XI
EMPLOYMENT AND SERVICE RIGHTS
Neither the Plan nor the grant of any Awards hereunder nor any action
taken by the Committee or the Board in connection with the Plan shall create
any right on the part of any Employee or Non-Employee Director to continue in
such capacity.
ARTICLE XII
WITHHOLDING
12.01 Tax Withholding. The Corporation may withhold from any cash
payment made under this Plan sufficient amounts to cover any applicable
withholding and employment taxes, and if the amount of such cash payment is
insufficient, the Corporation may require the Optionee to pay to the
Corporation the amount required to be withheld as a condition to delivering
the shares acquired pursuant to an Award. The Corporation also may withhold
or collect amounts with respect to a disqualifying disposition of shares of
Common Stock acquired pursuant to exercise of an Incentive Stock Option, as
provided in Section 8.10(c).
12.02 Methods of Tax Withholding. The Board or the Committee is
authorized to adopt rules, regulations or procedures which provide for the
satisfaction of an Optionee's tax withholding obligation by the retention of
shares of Common Stock to which the Employee would otherwise be entitled
pursuant to an Award and/or by the Optionee's delivery of previously-owned
shares of Common Stock or other property.
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ARTICLE XIII
EFFECTIVE DATE OF THE PLAN; TERM
13.01 Effective Date of the Plan. This Plan shall become effective
on the Effective Date, and Awards may be granted hereunder no earlier than
the date that this Plan is approved by stockholders of the Corporation and
prior to the termination of the Plan, provided that this Plan is approved by
stockholders of the Corporation pursuant to Article XIV hereof.
13.02 Term of the Plan. Unless sooner terminated, this Plan shall
remain in effect for a period of ten (10) years ending on the tenth
anniversary of the Effective Date. Termination of the Plan shall not affect
any Awards previously granted and such Awards shall remain valid and in
effect until they have been fully exercised or earned, are surrendered or by
their terms expire or are forfeited.
ARTICLE XIV
STOCKHOLDER APPROVAL
The Corporation shall submit this Plan to stockholders for approval at a
meeting of stockholders of the Corporation held within twelve (12) months
following the Effective Date in order to meet the requirements of (i) Section
422 of the Code and regulations thereunder, (ii) the National Association of
Securities Dealers, Inc. for quotation of the Common Stock on the Nasdaq
Stock Market's National Market, and (iii) regulations of the Office of Thrift
Supervision.
ARTICLE XV
MISCELLANEOUS
15.01 Governing Law. To the extent not governed by federal law, this
Plan shall be construed under the laws of the State of Louisiana.
15.02 Pronouns. Wherever appropriate, the masculine pronoun shall
include the feminine pronoun, and the singular shall include the plural.
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Appendix B
GS FINANCIAL CORP.
1997 RECOGNITION AND RETENTION PLAN AND TRUST AGREEMENT
ARTICLE I
ESTABLISHMENT OF THE PLAN AND TRUST
1.01 GS Financial Corp. (the "Corporation") hereby establishes the 1997
Recognition and Retention Plan (the "Plan") and Trust (the "Trust") upon the
terms and conditions hereinafter stated in this 1997 Recognition and
Retention Plan and Trust Agreement (the "Agreement").
1.02 The Trustee hereby accepts this Trust and agrees to hold the Trust
assets existing on the date of this Agreement and all additions and
accretions thereto upon the terms and conditions hereinafter stated.
ARTICLE II
PURPOSE OF THE PLAN
2.01 The purpose of the Plan is to retain personnel of experience and
ability in key positions by providing Employees and Non-Employee Directors of
the Corporation and Guaranty Savings and Homestead Association (the
"Association") with a proprietary interest in the Corporation as compensation
for their contributions to the Corporation and the Association and as an
incentive to make such contributions in the future.
ARTICLE III
DEFINITIONS
The following words and phrases when used in this Agreement with an
initial capital letter, unless the context clearly indicates otherwise, shall
have the meanings set forth below. Wherever appropriate, the masculine
pronouns shall include the feminine pronouns and the singular shall include
the plural.
3.01 "Association" means Guaranty Savings and Homestead Association, the
wholly-owned subsidiary of the Corporation.
3.02 "Beneficiary" means the person or persons designated by a Recipient
to receive any benefits payable under the Plan in the event of such
Recipient's death. Such person or persons shall be designated in writing on
forms provided for this purpose by the Committee and may be changed from time
to time by similar written notice to the Committee. In the absence of a
written designation, the Beneficiary shall be the Recipient's surviving
spouse, if any, or if none, his estate.
3.03 "Board" means the Board of Directors of the Corporation.
3.04 "Change in Control of the Corporation" shall mean a change in
control of a nature that would be required to be reported in response to Item
6(e) of Schedule 14A of
<PAGE>
Regulation 14A promulgated under the Exchange Act, whether or not the
Corporation in fact is required to comply with Regulation 14A thereunder;
provided that, without limitation, such a change in control shall be deemed
to have occurred if (i) any "person" (as such term is used in Sections 13(d)
and 14(d) of the Exchange Act), other than the Corporation, is or becomes the
"beneficial owner" (as defined in Rule 13d-3 under the Exchange Act),
directly or indirectly, of securities of the Corporation representing 25% or
more of the combined voting power of the Corporation's then outstanding
securities, or (ii) during any period of twenty-four consecutive months
during the term of a Plan Share Award, individuals who at the beginning of
such period constitute the Board of Directors, and any new director whose
election by the Board of Directors or nomination for election by the
Corporation's stockholders was approved by a vote of at least two-thirds of
the directors then still in office who either were directors at the beginning
of the two-year period or whose election or nomination for election was
previously so approved, cease for any reason to constitute at least a
majority of the Board of Directors; (iii) the stockholders of the Corporation
approve a merger or consolidation of the Corporation with any other
corporation, other than a merger or consolidation that would result in the
voting securities of the Corporation outstanding immediately prior thereto
continuing to represent (either by remaining outstanding or by being
converted into voting securities of the surviving entity) more than 50% of
the combined voting power of the voting securities of the Corporation
outstanding immediately after such merger or consolidation; or (iv) the
stockholders of the Corporation approve a plan of complete liquidation of the
Corporation or an agreement for the sale or disposition by the Corporation of
all or substantially all of the Corporation's assets. If any of the events
enumerated in clauses (i) through (iv) occur, the Board shall determine the
effective date of the Change in Control resulting therefrom for purposes of
the Plan.
3.05 "Code" means the Internal Revenue Code of 1986, as amended.
3.06 "Committee" means the committee appointed by the Board pursuant to
Article IV hereof.
3.07 "Common Stock" means shares of the common stock, $.01 par value per
share, of the Corporation.
3.08 "Disability" means any physical or mental impairment which qualifies
an individual for disability benefits under the applicable long-term
disability plan maintained by the Corporation or any Subsidiary or, if no
such plan applies, which would qualify such individual for disability
benefits under the long-term disability plan maintained by the Corporation,
if such individual were covered by that plan.
3.09 "Effective Date" means the day upon which the Board approves this
Plan.
3.10 "Employee" means any person who is employed by the Corporation, the
Association or a Subsidiary, or is an officer of the Corporation, the
Association or a
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Subsidiary, including officers or other employees who may be directors of the
Corporation or the Association.
3.11 "Exchange Act" means the Securities Exchange Act of 1934, as amended.
3.12 "Non-Employee Director" means a member of the Board of the
Corporation or Board of Directors of the Association or any Subsidiary,
including a Director Emeritus of the Board of Directors of the Corporation or
the Board of Directors of the Association, who is not an Officer or Employee
of the Corporation or any Subsidiary.
3.13 "Plan Shares" or "Shares" means shares of Common Stock held in the
Trust which may be distributed to a Recipient pursuant to the Plan.
3.14 "Plan Share Award" or "Award" means a right granted under this Plan
to receive a distribution of Plan Shares upon completion of the service
requirements described in Article VII.
3.15 "Recipient" means an Employee or Non-Employee Director who receives
a Plan Share Award under the Plan.
3.16 "Retirement" means a termination of employment which constitutes a
"retirement" under any applicable qualified pension benefit plan maintained
by the Corporation or a Subsidiary Corporation, or, if no such plan is
applicable, which would constitute "retirement" under the Corporation's
pension benefit plan, if such individual were a participant in that plan.
3.17 "Subsidiary" means the Association and any other subsidiaries of the
Corporation or the Association which, with the consent of the Board, agree to
participate in this Plan.
3.18 "Trustee" means such firm, entity or persons approved by the Board
to hold legal title to the Plan for the purposes set forth herein.
ARTICLE IV
ADMINISTRATION OF THE PLAN
4.01 Role of the Committee. The Plan shall be administered and
interpreted by the Committee, which shall consist of two or more members of
the Board, each of whom shall be a Non-Employee Director, as defined in Rule
16b-3(b)(3)(i) of the Exchange Act, or any successor thereto. The Committee
shall have all of the powers allocated to it in this and other Sections of
the Plan. The interpretation and construction by the Committee of any
provisions of the Plan or of any Plan Share Award granted hereunder shall be
final and binding in the absence of action by the Board. The Committee shall
act by vote or written consent of a majority of its members. Subject to the
express provisions and limitations of
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the Plan, the Committee may adopt such rules, regulations and procedures as
it deems appropriate for the conduct of its affairs. The Committee shall
report its actions and decisions with respect to the Plan to the Board at
appropriate times, but in no event less than one time per calendar year.
4.02 Role of the Board. The members of the Committee and the Trustee
shall be appointed or approved by, and will serve at the pleasure of, the
Board. The Board may in its discretion from time to time remove members
from, or add members to, the Committee, and may remove or replace the
Trustee, provided that any directors who are selected as members of the
Committee shall be Non-Employee Directors.
4.03 Limitation on Liability. No member of the Board or the Committee
shall be liable for any determination made in good faith with respect to the
Plan or any Plan Shares or Plan Share Awards granted under it. If a member
of the Board or the Committee is a party or is threatened to be made a party
to any threatened, pending or completed action, suit or proceeding, whether
civil, criminal, administrative or investigative, by reason of anything done
or not done by him in such capacity under or with respect to the Plan, the
Corporation shall, subject to the requirements of applicable laws and
regulations, indemnify such member against all liabilities and expenses
(including attorneys' fees), judgments, fines and amounts paid in settlement
actually and reasonably incurred by him in connection with such action, suit
or proceeding if he acted in good faith and in a manner he reasonably
believed to be in the best interests of the Corporation and any Subsidiaries
and, with respect to any criminal action or proceeding, had no reasonable
cause to believe his conduct was unlawful.
4.04 Compliance with Laws and Regulations. All Awards granted hereunder
shall be subject to all applicable federal and state laws, rules and
regulations and to such approvals by any government or regulatory agency or
stockholders as may be required.
ARTICLE V
CONTRIBUTIONS
5.01 Amount and Timing of Contributions. The Board shall determine the
amount (or the method of computing the amount) and timing of any
contributions by the Corporation and any Subsidiaries to the Trust
established under this Plan. Such amounts may be paid in cash or in shares
of Common Stock and shall be paid to the Trust at the designated time of
contribution. No contributions by Employees or Non-Employee Directors shall
be permitted.
5.02 Investment of Trust Assets; Number of Plan Shares. Subject to
Section 8.02 hereof, the Trustee shall invest all of the Trust's assets
primarily in Common Stock. The aggregate number of Plan Shares available for
distribution pursuant to this Plan shall be
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137,540 shares of Common Stock, subject to adjustment as provided in Section
9.01 hereof, which shares shall be purchased (from the Corporation and/or, if
permitted by applicable regulations, from stockholders thereof) by the Trust
with funds contributed by the Corporation.
ARTICLE VI
ELIGIBILITY; ALLOCATIONS
6.01 Awards to Non-Employee Directors. Plan Share Awards to Non-Employee
Directors shall be made to such persons and in such amounts as determined by
the Board or the Committee. Plan Share Awards to Non-Employee Directors in
the aggregate shall not exceed 41,262 shares (30% of the number of shares
available under this Plan) and no individual Non-Employee Director may
receive Plan Share Awards in excess of 6,877 shares (5% of the number of
shares available under this Plan).
6.02 Awards to Employees. Plan Share Awards may be made to such
Employees as may be selected by the Board or the Committee. In selecting
those Employees to whom Plan Share Awards may be granted and the number of
Shares covered by such Awards, the Board or the Committee shall consider the
duties, responsibilities and performance of each respective Employee, his
present and potential contributions to the growth and success of the
Corporation, his salary and such other factors as deemed relevant to
accomplishing the purposes of the Plan. The Board or the Committee may but
shall not be required to request the written recommendation of the Chief
Executive Officer of the Corporation other than with respect to Plan Share
Awards to be granted to him. Plan Share Awards to Employees shall not exceed
34,385 shares (25% of the shares of Common Stock available under the Plan).
6.03 Form of Allocation. As promptly as practicable after an allocation
pursuant to Sections 6.01 or 6.02 that a Plan Share Award is to be issued,
the Board or the Committee shall notify the Recipient in writing of the grant
of the Award, the number of Plan Shares covered by the Award, and the terms
upon which the Plan Shares subject to the Award shall be distributed to the
Recipient. The date on which the Board or the Committee so notifies the
Recipient shall be considered the date of grant of the Plan Share Award. The
Board or the Committee shall maintain records as to all grants of Plan Share
Awards under the Plan.
6.04 Allocations Not Required to any Specific Employee or Non-Employee
Director. Notwithstanding anything to the contrary in Sections 6.01 or 6.02
hereof, no Employee or Non-Employee Director shall have any right or
entitlement to receive a Plan Share Award hereunder, such Awards being at the
total discretion of the Board or the Committee.
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ARTICLE VII
EARNING AND DISTRIBUTION OF PLAN SHARES; VOTING RIGHTS
7.01 Earning Plan Shares; Forfeitures.
(a) General Rules. Subject to the terms hereof, Plan Share Awards
shall be earned by a Recipient at the rate of twenty percent (20%) of the
aggregate number of Shares covered by the Award over five years, commencing
one year from the date and an additional 20% shall be earned as of each
successive annual anniversary of the date of grant of the Award. If the
employment of an Employee or service as a Non-Employee Director is terminated
prior to the fifth (5th) annual anniversary of the date of grant of a Plan
Share Award for any reason (except as specifically provided in subsections
(b) and (c) below), the Recipient shall forfeit the right to any Shares
subject to the Award which have not theretofore been earned. In the event of
a forfeiture of the right to any Shares subject to an Award, such forfeited
Shares shall become available for allocation pursuant to Sections 6.01 and
6.02 hereof as if no Award had been previously granted with respect to such
Shares. No fractional shares shall be distributed pursuant to this Plan.
(b) Exception for Terminations Due to Death, Disability or
Retirement. Notwithstanding the general rule contained in Section 7.01(a),
all Plan Shares subject to a Plan Share Award held by a Recipient whose
employment with the Corporation or any Subsidiary or service as a
Non-Employee Director terminates due to death or Disability shall be deemed
earned as of the Recipient's last day of employment with or service to the
Corporation or any Subsidiary and shall be distributed as soon as practicable
thereafter; provided, however, that Awards shall be distributed in accordance
with Section 7.03(a). In addition, in the event that a Recipient's
employment or service as a Non-Employee Director with the Corporation, the
Association or any Subsidiary terminates due to Retirement, all Plan Shares
subject to a Plan Share Award held by a Recipient shall be deemed earned as
of the Recipient's last day of employment with or service to the Corporation
or any Subsidiary and shall be distributed as soon as practicable thereafter;
provided, however, that as of the date of such Retirement, such treatment is
either authorized or is not prohibited by applicable laws and regulations.
(c) Exception for Terminations after a Change in Control of the
Corporation. Notwithstanding the general rule contained in Section 7.01(a),
all Plan Shares subject to a Plan Share Award held by a Recipient shall be
deemed to be earned in the event of a Change in Control of the Corporation
if, as of the date of such Change in Control of the Corporation, such
treatment is either authorized or is not prohibited by applicable laws and
regulations.
(d) Revocation for Misconduct. Notwithstanding anything
hereinafter to the contrary, the Board may by resolution immediately revoke,
rescind and terminate any Plan Share Award, or portion thereof, previously
awarded under this Plan, to the extent Plan Shares have not been distributed
hereunder to the Recipient, whether or not yet earned, in
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the case of an Employee who is discharged from the employ of the Corporation
or any Subsidiary for cause (as hereinafter defined). Termination for cause
shall mean termination because of the Employee's personal dishonesty,
incompetence, willful misconduct, breach of fiduciary duty involving personal
profit, intentional failure to perform stated duties, willful violation of
any law, rule, or regulation (other than traffic violations or similar
offenses) or final cease-and-desist order. Plan Share Awards granted to a
Non-Employee Director who is removed for cause pursuant to the Corporation's
Articles of Incorporation and Bylaws or the Association's Charter and Bylaws
shall terminate as of the effective date of such removal.
7.02 Distribution of Dividends. Any cash dividends (including special
large and nonrecurring dividends including one that has the effect of a
return of capital to the Corporation's stockholders) or stock dividends
declared in respect of each unvested Plan Share Award will be held by the
Trust for the benefit of the Recipient on whose behalf such Plan Share Award
is then held by the Trust and such dividends, including any interest thereon,
will be paid out proportionately by the Trust to the Recipient thereof as
soon as practicable after the Plan Share Awards become earned. Any cash
dividends or stock dividends declared in respect of each vested Plan Share
held by the Trust will be paid by the Trust, as soon as practicable after the
Trust's receipt thereof, to the Recipient on whose behalf such Plan Share is
then held by the Trust.
7.03 Distribution of Plan Shares.
(a) Timing of Distributions: General Rule. Plan Shares shall be
distributed to the Recipient or his Beneficiary, as the case may be, as soon
as practicable after they have been earned.
(b) Form of Distributions. All Plan Shares, together with any
Shares representing stock dividends, shall be distributed in the form of
Common Stock. One share of Common Stock shall be given for each Plan Share
earned and distributable. Payments representing cash dividends shall be made
in cash.
(c) Withholding. The Trustee may withhold from any cash payment or
Common Stock distribution made under this Plan sufficient amounts to cover
any applicable withholding and employment taxes, and if the amount of a cash
payment is insufficient, the Trustee may require the Recipient or Beneficiary
to pay to the Trustee the amount required to be withheld as a condition of
delivering the Plan Shares. The Trustee shall pay over to the Corporation or
any Subsidiary which employs or employed such Recipient any such amount
withheld from or paid by the Recipient or Beneficiary.
(d) Restrictions on Selling of Plan Shares. Plan Share Awards may
not be sold, assigned, pledged or otherwise disposed of prior to the time
that they are earned and distributed pursuant to the terms of this Plan.
Following distribution, the Board or the Committee may require the Recipient
or his Beneficiary, as the case may be, to agree not
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to sell or otherwise dispose of his distributed Plan Shares except in
accordance with all then applicable Federal and state securities laws, and
the Board or the Committee may cause a legend to be placed on the stock
certificate(s) representing the distributed Plan Shares in order to restrict
the transfer of the distributed Plan Shares for such period of time or under
such circumstances as the Board or the Committee, upon the advice of counsel,
may deem appropriate.
7.04 Voting of Plan Shares. After a Plan Share Award has been made, the
Recipient shall be entitled to direct the Trustee as to the voting of the
Plan Shares which are covered by the Plan Share Award and which have not yet
been earned and distributed to him pursuant to Section 7.03, subject to rules
and procedures adopted by the Committee for this purpose. All shares of
Common Stock held by the Trust which have not been awarded under a Plan Share
Award and shares which have been awarded as to which Recipients have not
directed the voting shall be voted by the Trustee in the same proportion as
voted by the Trustee for shares allocated and which the Trustee receives
directions for such vote by Recipients.
ARTICLE VIII
TRUST
8.01 Trust. The Trustee shall receive, hold, administer, invest and make
distributions and disbursements from the Trust in accordance with the
provisions of the Plan and Trust and the applicable directions, rules,
regulations, procedures and policies established by the Board or the
Committee pursuant to the Plan.
8.02 Management of Trust. It is the intent of this Plan and Trust that
the Trustee shall have complete authority and discretion with respect to the
arrangement, control and investment of the Trust, and that the Trustee shall
invest all assets of the Trust in Common Stock to the fullest extent
practicable, except to the extent that the Trustee determines that the
holding of monies in cash or cash equivalents is necessary to meet the
obligations of the Trust. In performing their duties, the Trustee shall have
the power to do all things and execute such instruments as may be deemed
necessary or proper, including the following powers:
(a) To invest up to one hundred percent (100%) of all Trust assets
in Common Stock without regard to any law now or hereafter in force limiting
investments for trustees or other fiduciaries. The investment authorized
herein may constitute the only investment of the Trust, and in making such
investment, the Trustee is authorized to purchase Common Stock from the
Corporation or from any other source, and such Common Stock so purchased may
be outstanding, newly issued, or treasury shares.
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<PAGE>
(b) To invest any Trust assets not otherwise invested in accordance
with (a) above, in such deposit accounts, and certificates of deposit,
obligations of the United States Government or its agencies or such other
investments as shall be considered the equivalent of cash.
(c) To sell, exchange or otherwise dispose of any property at any
time held or acquired by the Trust.
(d) To cause stocks, bonds or other securities to be registered in
the name of a nominee, without the addition of words indicating that such
security is an asset of the Trust (but accurate records shall be maintained
showing that such security is an asset of the Trust).
(e) To hold cash without interest in such amounts as may in the
opinion of the Trustee be reasonable for the proper operation of the Plan and
Trust.
(f) To employ brokers, agents, custodians, consultants and
accountants.
(g) To hire counsel to render advice with respect to their rights,
duties and obligations hereunder, and such other legal services or
representation as they may deem desirable.
(h) To hold funds and securities representing the amounts to be
distributed to a Recipient or his Beneficiary as a consequence of a dispute
as to the disposition thereof, whether in a segregated account or held in
common with other assets of the Trust.
Notwithstanding anything herein contained to the contrary, the Trustee
shall not be required to make any inventory, appraisal or settlement or
report to any court, or to secure any order of court for the exercise of any
power herein contained, or give bond.
8.03 Records and Accounts. The Trustee shall maintain accurate and
detailed records and accounts of all transactions of the Trust, which shall
be available at all reasonable times for inspection by any legally entitled
person or entity to the extent required by applicable law, or any other
person determined by the Board or the Committee.
8.04 Expenses. All costs and expenses incurred in the operation and
administration of this Plan shall be borne by the Corporation or, in the
discretion of the Corporation, the Trust.
8.05 Indemnification. Subject to the requirements of applicable laws and
regulations, the Corporation shall indemnify, defend and hold the Trustee
harmless against all claims, expenses and liabilities arising out of or
related to the exercise of the Trustee's powers and the discharge of its
duties hereunder, unless the same shall be due to their gross negligence or
willful misconduct.
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ARTICLE IX
MISCELLANEOUS
9.01 Adjustments for Capital Changes. The aggregate number of Plan
Shares available for distribution pursuant to the Plan Share Awards and the
number of Shares to which any Plan Share Award relates shall be
proportionately adjusted for any increase or decrease in the total number of
outstanding shares of Common Stock issued subsequent to the effective date of
the Plan resulting from any split, subdivision or consolidation of shares or
other capital adjustment, or other increase or decrease in such shares
effected without receipt or payment of consideration by the Corporation.
9.02 Amendment and Termination of Plan. The Board may, by resolution, at
any time amend or terminate the Plan and the Trust (including amendments
which may result in the merger of the Plan or the Trust with and into other
plans or trusts of the Corporation or successor thereto), subject to any
applicable regulatory requirement, any required stockholder approval or any
stockholder approval which the Board may deem to be advisable for any reason,
such as for the purpose of obtaining or retaining any statutory or regulatory
benefits under tax, securities or other laws or satisfying any applicable
stock exchange listing requirements. The Board may not, without the consent
of the Recipient, alter or impair his Plan Share Award except as specifically
authorized herein. Upon termination of the Plan, the Recipient's Plan Share
Awards shall be distributed to the Recipient regardless of whether or not
such Plan Share Award had otherwise been earned under the service
requirements set forth in Article VII.
9.03 Nontransferable. During the lifetime of the Recipient, Plan Shares
may only be earned by and paid to the Recipient who was notified in writing
of the Award pursuant to Section 6.03, provided that Plan Share Awards and
rights to Plan Shares shall be transferable by a Recipient to his or her
spouse, lineal ascendants, lineal descendants, or to a duly established
trust. Plan Share Awards so transferred may not again be transferred other
than to the Recipient who originally received the grant of Plan Share Award
or to an individual or trust to whom such Recipient could have transferred
Plan Share Awards pursuant to this Section 9.03. Plan Share Awards which are
transferred pursuant to this Section 9.03 shall be subject to the same terms
and conditions as would have applied to such Plan Share Awards in the hands
of the Recipient who originally received the grant of such Plan Share Award.
No Recipient or Beneficiary shall have any right in or claim to any assets of
the Plan or Trust, nor shall the Corporation or any Subsidiary be subject to
any claim for benefits hereunder.
9.04 Employment or Service Rights. Neither the Plan nor any grant of a
Plan Share Award or Plan Shares hereunder nor any action taken by the
Trustee, the Committee or the Board in connection with the Plan shall create
any right on the part of any Employee or Non-Employee Director to continue in
such capacity.
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9.05 Voting and Dividend Rights. No Recipient shall have any voting or
dividend rights or other rights of a stockholder in respect of any Plan
Shares covered by a Plan Share Award, except as expressly provided in
Sections 7.02 and 7.04 above, prior to the time said Plan Shares are actually
earned and distributed to him.
9.06 Governing Law. To the extent not governed by federal law, the Plan
and Trust shall be governed by the laws of the State of Louisiana.
9.07 Effective Date. This Plan shall be effective as of the Effective
Date, and Awards may be granted hereunder as of or after the Effective Date
and as long as the Plan remains in effect. Notwithstanding the foregoing or
anything to the contrary in this Plan, the implementation of this Plan and
any Awards granted pursuant hereto are subject to the receipt of any
applicable regulatory approvals or non-objections and approval of the
Corporation's stockholders.
9.08 Term of Plan. This Plan shall remain in effect until the earlier of
(1) ten (10) years from the Effective Date, (2) termination by the Board, or
(3) the distribution to Recipients and Beneficiaries of all assets of the
Trust.
9.09 Tax Status of Trust. It is intended that the trust established
hereby be treated as a Grantor Trust of the Corporation under the provisions
of Section 671 et seq. of the Code, as the same may be amended from time to
time.
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<PAGE>
IN WITNESS WHEREOF, the Corporation has caused this Agreement to be
executed by its duly authorized officers and the corporate seal to be affixed
and duly attested, and the initial Trustee of the Trust established pursuant
hereto have duly and validly executed this Agreement, all on this 14th day of
August 1997.
GS FINANCIAL CORP.
By: /s/ DONALD C. SCOTT
---------------------------------------
Donald C. Scott
President and
Chief Executive Officer
ATTEST: TRUSTEES:
/s/ LETTIE RUFIN MOLL /s/ DONALD C. SCOTT
- ----------------------- -------------------------------------------
Lettie Rufin Moll Donald C. Scott
Corporate Secretary
/s/ BRUCE A. SCOTT
-------------------------------------------
Bruce A. Scott
/s/ LETTIE R. MOLL
-------------------------------------------
Lettie R. Moll
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<PAGE>
REVOCABLE PROXY
GS FINANCIAL CORP.
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS OF GS
FINANCIAL CORP. ("COMPANY") FOR USE AT THE SPECIAL MEETING OF STOCKHOLDERS TO
BE HELD ON OCTOBER 15, 1997 AND AT ANY ADJOURNMENT THEREOF.
The undersigned, being a stockholder of the Company as of September 10,
1997, hereby authorizes the Board of Directors of the Company or any
successors thereto as proxies with full powers of substitution, to represent
the undersigned at the Special Meeting of Stockholders of the Company to be
held at the main office of the Company located at 3798 Veterans Memorial
Boulevard, Metairie, Louisiana 70002 on Wednesday, October 15, 1997 at 4:30
p.m., Central Time, and at any adjournment of said meeting, and thereat to
act with respect to all votes that the undersigned would be entitled to cast,
if then personally present, as follows:
1. PROPOSAL to adopt the Company's 1997 Stock Option Plan.
/ / FOR / /AGAINST / / ABSTAIN
2. PROPOSAL to adopt the Company's 1997 Recognition and Retention Plan and
Trust.
/ / FOR / /AGAINST / / ABSTAIN
3. PROPOSAL to adjourn the Special Meeting, if necessary, to solicit
additional proxies.
/ / FOR / /AGAINST / / ABSTAIN
4. In their discretion, the proxies are authorized to vote upon such other
business as may properly come before the meeting.
(Continued and to be signed on other side)
<PAGE>
SHARES OF THE COMPANY'S COMMON STOCK WILL BE VOTED AS SPECIFIED. IF
RETURNED BUT NOT OTHERWISE SPECIFIED, THIS PROXY WILL BE VOTED FOR PROPOSALS
1, 2 AND, IF NECESSARY, 3 AND OTHERWISE AT THE DISCRETION OF THE PROXIES.
YOU MAY REVOKE THIS PROXY AT ANY TIME PRIOR TO THE TIME IT IS VOTED AT THE
SPECIAL MEETING.
Dated: ________________, 1997
------------------------------------------
------------------------------------------
Signature(s)
Please sign this exactly as your name(s)
appear(s) on this proxy. When signing in a
representative capacity, please give title.
When shares are held jointly, only one holder
need sign.
PLEASE MARK, SIGN, DATE AND RETURN THE PROXY CARD PROMPTLY USING THE ENCLOSED
ENVELOPE.
