<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
/X/ Definitive Proxy Statement Commission Only (as permitted by
/ / Definitive Additional Materials Rule 14a-6(e)(2))
/ / 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
March 30, 1998
Dear Stockholder:
You are cordially invited to attend the first Annual 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 Tuesday, April 28, 1998 at 10:00 a.m., Central Time. The matters to be
considered by stockholders at the Annual Meeting are described in the
accompanying materials.
It is very important that your shares be voted at the Annual 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 Annual 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 ANNUAL MEETING OF STOCKHOLDERS
To Be Held on April 28, 1998
------------
NOTICE IS HEREBY GIVEN that the Annual Meeting of Stockholders ("Annual
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 Tuesday, April 28, 1998 at 10:00 a.m., Central Time, for the following
purposes, all of which are more completely set forth in the accompanying Proxy
Statement:
(1) To elect three directors for a three-year term expiring in 2001, and
until their successors are elected and qualified;
(2) To ratify the appointment by the Board of Directors of LaPorte, Sehrt,
Romig & Hand as the Company's independent auditors for the fiscal year ending
December 31, 1998; and
(3) 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 March 16, 1998 as the voting record date
for the determination of stockholders entitled to notice of and to vote at the
Annual 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
Annual Meeting or at any such adjournment.
By Order of the Board of Directors
/s/ Lettie R. Moll
----------------------------------
Lettie R. Moll
Vice President and Secretary
Metairie, Louisiana
March 30, 1998
- ------------------------------------------------------------------------------
YOU ARE CORDIALLY INVITED TO ATTEND THE ANNUAL 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
---------
ANNUAL MEETING OF STOCKHOLDERS
April 28, 1998
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
parent holding company of Guaranty Savings and Homestead Association (the
"Association"). Proxies are being solicited on behalf of the Board of Directors
of the Company to be used at the Annual Meeting of Stockholders ("Annual
Meeting") to be held at the main office of the Company located at 3798 Veterans
Memorial Boulevard, Metairie, Louisiana on Tuesday, April 28, 1998 at 10:00
a.m., Central Time, and at any adjournment thereof for the purposes set forth in
the Notice of Annual Meeting of Stockholders. This Proxy Statement is first
being mailed to stockholders on or about March 30, 1998.
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 Annual Meeting and giving the
Secretary notice of his or her intention to vote in person. Proxies solicited
hereby may be exercised only at the Annual 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
March 16, 1998 ("Voting Record Date") are entitled to notice of and to vote at
the Annual 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 Annual Meeting on all
matters properly presented at the Annual Meeting. Directors are elected by a
plurality of the votes cast with a quorum present. Abstentions are considered
in determining the presence of a quorum and will not affect the plurality vote
required for the election of directors. The affirmative vote of the holders of
a majority of the total votes eligible to be cast in person and by proxy at the
Annual Meeting is required
<PAGE>
to ratify the appointment of the independent auditors. Under rules applicable
to broker-dealers, the proposal for ratification of the auditors 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-votes."
INFORMATION WITH RESPECT TO NOMINEES FOR DIRECTOR
AND EXECUTIVE OFFICERS
Election of Directors
The Articles of Incorporation of the Company provide that the Board of
Directors shall be divided into three classes as nearly equal in number as the
then total number of directors constituting the Board of Directors permits. The
directors shall be elected by the stockholders of the Company for staggered
terms, or until their successors are elected and qualified.
At the Annual Meeting, stockholders of the Company will be asked to elect
one class of directors, consisting of three directors, for a three-year term
expiring in 2001, and until their successors are elected and qualified.
No director is related to any other director or executive officer by first
cousin or closer, except that Donald C. Scott and Bruce A. Scott are brothers
and Bruce A. Scott and Stephen L. Cory are brothers-in-law. Each nominee
currently serves as a director of the Company and of the Association.
Unless otherwise directed, each proxy executed and returned by a
stockholder will be voted for the election of the nominees for director listed
below. If any person named as a nominee should be unable or unwilling to stand
for election at the time of the Annual Meeting, the proxies will nominate and
vote for any replacement nominee or nominees recommended by the Board of
Directors. At this time, the Board of Directors knows of no reason why any of
the nominees listed below may not be able to serve as a director if elected.
The following tables present information concerning the principal
occupations of the nominees for director and the continuing directors of the
Company during the last five years, including tenure as a director. All of the
below-listed directors also serve as directors of the Association.
2
<PAGE>
Nominees for Director for Three-Year Terms Expiring in 2001
<TABLE>
<CAPTION>
PRINCIPAL OCCUPATION DURING DIRECTOR
NAME AGE(1) THE PAST FIVE YEARS SINCE(2)
- ----------------------------------------------- ----------- ----------------------------------------------- -----------
<S> <C> <C> <C>
Victor Kirschman 74 Mr. Kirschman is the Chairman of M. Kirschman & 1977
Co., Inc., a retail furniture business with its
main office in New Orleans, Louisiana.
Mannie D. Paine, Jr. 81 Dr. Paine is a retired physician. Dr. Paine has 1976
provided consulting services to Blue Cross and
Blue Shield of Louisiana since 1985.
Donald C. Scott 46 Mr. Scott has served as President and Chief 1982
Executive Officer of the Company since February
1997 and President of the Association since
March 1985; prior thereto, he served in various
management and other positions at the
Association.
</TABLE>
The Board of Directors recommends that you vote FOR election of the nominees
for Director.
DIRECTORS WHOSE TERMS ARE CONTINUING
Directors with a Term Expiring in 1999
<TABLE>
<CAPTION>
PRINCIPAL OCCUPATION DURING DIRECTOR
NAME AGE(1) THE PAST FIVE YEARS SINCE(2)
- ----------------------------------------------- ----------- ----------------------------------------------- -----------
<S> <C> <C> <C>
Kenneth B. Caldcleugh 48 Mr. Caldcleugh is the President and Owner of 1996
The Cellars of River Ridge, a fine wine and
spirit retail outlet in Louisiana. Prior
thereto, Mr. Caldcleugh was the Vice President
and Regional Manager of Glazer Companies of
Louisiana (formerly Glazer Wholesale Spirit &
Wine Distributors), from 1973 to 1996.
</TABLE>
(Footnotes on following page)
3
<PAGE>
<TABLE>
<CAPTION>
PRINCIPAL OCCUPATION DURING DIRECTOR
NAME AGE(1) THE PAST FIVE YEARS SINCE(2)
- ----------------------------------------------- ----------- ----------------------------------------------- -----------
<S> <C> <C> <C>
Bradford A. Glazer 42 Mr. Glazer is Senior Vice President of 1991
Espy & Straus, Inc., Cincinnati, Ohio,
a real estate brokerage, development
and management firm. Prior thereto, Mr.
Glazer was the Chairman of Glazer Steel
Corporation, a metal service center in
New Orleans, Louisiana and Knoxville,
Tennessee.
Bruce A. Scott 45 Mr. Scott is an attorney and has served 1982
as Executive Vice President of the
Company since February 1997 and
Executive Vice President of the
Association since 1985. Mr. Scott also
serves as legal counsel and Personnel
Manager of the Association, and
performs certain legal services for the
Association and its borrowers in
connection with real estate loan
closings and receives fees from the
borrowers in connection therewith.
</TABLE>
Directors with a Term Expiring in 2000
<TABLE>
<CAPTION>
PRINCIPAL OCCUPATION DURING DIRECTOR
NAME AGE(1) THE PAST FIVE YEARS SINCE(2)
- ----------------------------------------------- ----------- ----------------------------------------------- -----------
<S> <C> <C> <C>
Stephen L. Cory 48 Mr. Cory is an insurance agent and President of 1995
the Cory, Tucker & Larrowe Agency in Metairie,
Louisiana.
J. Scott Key 45 Mr. Key is the President and Chief Operating 1991
Officer of Kencoil, Inc. (previously D&S
Industries), an electric motor coil
manufacturer and its subsidiary Scott Armature,
a provider of sales and services of electrical
apparatus, in Belle Chasse, Louisiana.
Albert J. Zahn, Jr. 46 Mr. Zahn is a certified public accountant and 1992
partner in the firm of Zahn, Kenney & Bresette
in Metairie, Louisiana.
</TABLE>
- ------------------------------
(1) As of March 16, 1998.
(2) Includes service as a director of the Association.
4
<PAGE>
Shareholder Nominations
Article 6, Section F ("Article 6.F.") of the Company's Articles of
Incorporation ("Articles") governs nominations of candidates for election as
director at any annual meeting of stockholders and provides that such
nominations, other than those made by the Board, may be made by any stockholder
entitled to vote at such annual meeting provided such nomination is made in
accordance with the procedures set forth in Article 6.F., which is summarized
below.
Nominations, other than those made by or at the direction of the Board of
Directors, shall be made pursuant to timely notice in writing to the Secretary
of the Company. To be timely, a stockholder's notice shall be delivered to, or
mailed and received at, the principal executive offices of the Company not later
than 60 days prior to the anniversary date of the immediately preceding annual
meeting of stockholders of the Company. Such stockholder's notice shall set
forth (a) as to each person whom the stockholder proposes to nominate for
election or re-election as a director (i) the name, age, business address and
residence address of such person, (ii) the principal occupation or employment of
such person, (iii) the class and number of shares of Company Stock which are
Beneficially Owned (as defined in Article 9.A(e) of the Articles) by such person
on the date of such stockholder notice, and (iv) any other information relating
to such person that is required to be disclosed in solicitations of proxies with
respect to nominees for election as directors, pursuant to Regulation 14A under
the Securities Exchange Act of 1934, as amended (the "Exchange Act"), including,
but not limited to, information required to be disclosed by Items 4, 5, 6 and 7
of Schedule 14A (or any successors of such items or schedules); and (b) as to
the stockholder giving the notice (i) the name and address, as they appear on
the Company's books, of such stockholder and any other stockholders known by
such stockholder to be supporting such nominees and (ii) the class and number of
shares of Company Stock which are Beneficially Owned by such stockholder on the
date of such stockholder notice and, to the extent known, by any other
stockholders known by such stockholder to be supporting such nominees on the
date of such stockholder notice.
The Board of Directors may reject any nomination by a stockholder not
timely made in accordance with the requirements of Article 6.F. If the Board of
Directors, or a designated committee thereof, determines that the information
provided in a stockholder's notice does not satisfy the informational
requirements of Article 6.F in any material respect, the Secretary of the
Company shall promptly notify such stockholder of the deficiency in the notice.
The stockholder shall have an opportunity to cure the deficiency by providing
additional information to the Secretary within such period of time, not to
exceed five days from the date such deficiency notice is given to the
stockholder, as the Board of Directors or such committee shall reasonably
determine. If the deficiency is not cured within such period, or if the Board
of Directors or such committee reasonably determines that the additional
information provided by the stockholder, together with information previously
provided, does not satisfy the requirements of Article 6.F in any material
respect, then the Board of Directors may reject such stockholder's nomination.
The Secretary of the
5
<PAGE>
Company shall notify a stockholder in writing whether his nomination has been
made in accordance with the time and informational requirements of Article 6.F.
Notwithstanding the foregoing procedures, if neither the Board of Directors nor
such committee makes a determination as to the validity of any nominations by a
stockholder, the presiding officer of the annual meeting shall determine and
declare at the annual meeting whether the nomination was made in accordance with
the terms of Article 6.F. If the presiding officer determines that a nomination
was made in accordance with the terms of Article 6.F, he shall so declare at the
annual meeting and ballots shall be provided for use at the meeting with respect
to such nominee. If the presiding officer determines that a nomination was not
made in accordance with the terms of Article 6.F, he shall so declare at the
annual meeting and the defective nomination shall be disregarded.
Committees and Meetings of the Board of the Association and Company; Director
Nominations
The Board of Directors of the Company has not established any committees of
the Board to date other than a Compensation Committee. Nominations for director
of the Company are made by the full Board of Directors. During the fiscal year
ended December 31, 1997, the Board of Directors of the Company met 13 times. No
director of the Company attended fewer than 75% of the total number of Board
meetings or committee meetings on which he served that were held during this
period, except for Mr. Kirschman who attended 8 of the 13 Board meetings.
Compensation Committee. The Compensation Committee of the Company consists
of Messrs. Caldcleugh, Cory and Key and Dr. Paine. The Compensation Committee
reviews the compensation of the Company's executive officers. The Compensation
Committee met once during 1997. The report of the Compensation Committee with
respect to compensation for the Chief Executive Officer and all other executive
officers for fiscal 1997 is set forth under "Executive Compensation - Report of
the Compensation Committee." No member of the Compensation Committee is a
current or former officer or employee of the Company or any of its subsidiaries
or the Association.
The Association has established committees which include members of the
Board and senior management and which meet as required. These committees
include Executive, Compensation, Real Estate, Nominating and Audit Committees.
Executive Committee. The Executive Committee of the Association consists
of Messrs. Caldcleugh, Key, Kirschman and Zahn. The Executive Committee is
authorized to act, in most instances, with the same authority as the Board of
Directors of the Association between meetings of the full Board. The Executive
Committee did not meet during 1997.
Compensation Committee. The Compensation Committee of the Association
consists of Messrs. Caldcleugh, Glazer, Key and Kirschman and Dr. Paine. The
Compensation Committee reviews the compensation of the executive officers of the
Association. No
6
<PAGE>
member of the Compensation Committee is a current or former officer or employee
of the Company or any of its subsidiaries or the Association. The Compensation
Committee met two times during 1997.
Audit Committee. The Audit Committee of the Association consists of
Messrs. Key, Weber and Zahn and Dr. Paine. The Audit Committee supervises the
Association's internal auditing functions and is responsible for reviewing the
performance, and overseeing the engagement, of the Association's independent
certified public accountants. The Audit Committee met once during fiscal 1997.
Executive Officers Who Are Not Directors
Set forth below is information with respect to the principal occupations
during the last five years for the two executive officers of the Company and the
Association who do not serve as directors.
<TABLE>
<CAPTION>
NAME AGE(1) PRINCIPAL OCCUPATION DURING THE PAST FIVE YEARS
- ---------------------------------------------------- ----------- ----------------------------------------------------
<S> <C> <C>
Lettie R. Moll 44 Ms. Moll has served as Vice President and Secretary
of the Company since 1997 and Vice President and
Secretary of the Association since March 1987 and
March 1982, respectively.
Ralph E. Weber 53 Mr. Weber has primary responsibility for the
Association's data processing requirements and has
served as Vice President of the Company and the
Association since February 1997 and March 1987,
respectively.
</TABLE>
- -------------------------------
(1) As of March 16, 1998.
Compliance with Section 16(a) of the Exchange Act
Section 16(a) of the Exchange Act requires the officers and directors, and
persons who own more than 10% of the Company's Common Stock to file reports of
ownership and changes in ownership with the Securities and Exchange Commission
and the National Association of Securities Dealers, Inc. Officers, directors
and greater than 10% stockholders are required by regulation to furnish the
Company with copies of all Section 16(a) forms they file. The Company knows of
no person who owns 10% or more of the Company's Common Stock.
Based solely on review of the copies of such forms furnished to the
Company, or written representations from its officers and directors, the Company
believes that during, and with respect to, 1997, the Company's officers and
directors complied in all respects with the reporting requirements promulgated
under Section 16(a) of the Exchange Act.
7
<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
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 1997, and (iv) all directors and executive
officers of the Company and the Association as a group.
<TABLE>
<CAPTION>
AMOUNT AND NATURE
NAME OF BENEFICIAL OF BENEFICIAL PERCENT OF
OWNER OR NUMBER OF OWNERSHIP AS OF COMMON
PERSONS IN GROUP MARCH 16, 1998(1) STOCK
- ---------------------------------------------------------- ------------------ -------------
<S> <C> <C>
GS Financial Corp.
Employee Stock Ownership Plan
and Trust
3798 Veterans Memorial Boulevard
Metairie, Louisiana 70002 275,080(2) 8.0%
Directors:
Kenneth B. Caldcleugh..................................... 5,100 *
Stephen L. Cory........................................... 7,000 *
Bradford A. Glazer........................................ 11,000(3) *
J. Scott Key.............................................. 25,000 *
Victor Kirschman.......................................... 15,000 *
Mannie D. Paine, Jr., M.D................................. 12,500(4) *
Bruce A. Scott ........................................... 36,293(2)(5) 1.1
Donald C. Scott........................................... 35,726(6) 1.0
Albert J. Zahn, Jr. ...................................... 34,500(7) 1.0
All directors and executive officers of the Company and
the Association as a group (11 persons)................. 200,231 5.8
(Footnotes on following page)
</TABLE>
8
<PAGE>
_________________
<TABLE>
<CAPTION>
<S> <C>
* 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, 23,465 shares held in the
Trust have been allocated to the accounts of participating employees. The
251,615 unallocated shares held in the Trust as of the Voting Record Date
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 1,000 shares of Common Stock owned by Mr. Glazer's wife.
(4) Includes 6,250 shares of Common Stock owned by Dr. Paine's wife.
(5) 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. Also includes 2,293
shares of Common Stock allocated to Mr. Scott under the ESOP which the
Trustees will vote in accordance with Mr. Scott's instructions.
(6) 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 shares owned by Mr. Scott's wife. Also includes 2,626 shares of
Common Stock allocated to Mr. Scott under the ESOP which the Trustees will
vote in accordance with Mr. Scott's instructions.
(7) Includes 9,500 shares of Common Stock owned by Mr. Zahn's wife.
</TABLE>
9
<PAGE>
EXECUTIVE COMPENSATION
Summary Compensation Table
The Company has not yet paid separate compensation to its directors and
officers. 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 year ended December 31, 1997, 1996 and 1995 to the
President and Chief Executive Officer and the Executive Vice President. No
other executive officers of the Company or the Association had total annual
compensation in excess of $100,000 during fiscal 1997.
<TABLE>
<CAPTION>
LONG-TERM COMPENSATION
ANNUAL COMPENSATION
------------------------------------ -----------------------
OTHER RESTRICTED
ANNUAL STOCK ALL OTHER
NAME AND COMPENSATION AWARDS OPTIONS COMPENSATION
PRINCIPAL POSITION YEAR SALARY BONUS (1) (2) (3) (4)
- ------------------------------------------ --------- ---------- --------- ------------- ---------- ----------- -------------
<S> <C> <C> <C> <C> <C> <C> <C>
Donald C. Scott........................... 1997 $ 123,173 $ 9,490 $ 0 $ 590,992 85,962 $ 54,818
President and Chief 1996 100,600 36,004 16,413 0 0 0
Executive Officer 1995 97,127 16,552 13,642 0 0 0
Bruce A. Scott............................ 1997 $ 106,750 $ 8,907 $ 0 $ 590,992 85,962 $ 47,866
Executive Vice President 1996 91,900 32,857 14,971 0 0 0
1995 88,650 15,106 12,451 0 0 0
</TABLE>
_______________
<TABLE>
<CAPTION>
<S> <C>
(1) Amounts reflect the Association's contribution to its defined contributory
pension plan on behalf of the employee. 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 fiscal 1997 did not exceed the lesser
of $50,000 or 10% of the total salary and bonus paid to or accrued for the
benefit of such individual executive officer.
(2) Represents the grant of 34,385 shares of restricted Common Stock to each of
Messrs. Donald Scott and Bruce Scott pursuant to the Company's Recognition
Plan, which were deemed to have the indicated value at the date of grant,
October 15, 1997, and which had a fair market value at December 31, 1997 of
$717,787 and $717,787 for Messrs. Donald Scott and Bruce Scott,
respectively. The awards are earned at a rate of 20% per year from the
date of grant. Dividends paid on the restricted Common Stock are held in
the Recognition Plan Trust and paid to the recipient when the restricted
stock is earned.
(3) Consists of awards of stock options which are exercisable at the rate of
20% per year from the date of grant.
(4) Consists of amounts allocated during the year ended December 31, 1997 on
behalf of each individual pursuant to the ESOP.
</TABLE>
10
<PAGE>
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.
Each non-employee director of the Company received 14,736 non-qualified
stock options on October 15, 1997 with an exercise price of $17.1875, pursuant
to the Company's 1997 Stock Option Plan ("Stock Option Plan"). Such options
vest ratably over five years. In addition, each non-employee director of the
Company also received 5,894 shares of restricted Common Stock on October 15,
1997 which will be earned ratably over five years, pursuant to the Company's
Recognition Plan. Dividends paid on the restricted Common Stock are held in the
Recognition Plan Trust and paid to the recipient when the restricted stock is
earned. Future grants or awards under the Stock Option Plan or Recognition Plan
are at the discretion of the Company's Board or a Committee appointed by the
Board, consistent with the respective terms of such plans.
Employment and Severance Agreements
The Company and the Association (collectively the "Employers") in February
1997 entered into employment agreements with Messrs. Donald Scott and Bruce
Scott. The Employers agreed to employ Messrs. Donald Scott and Bruce Scott each
for a term of three years in their then current positions at their then current
base salaries. The agreements were amended on September 11, 1997, in part, to
increase the base salaries of Messrs. Donald Scott and Bruce Scott to $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
11
<PAGE>
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 Internal Revenue Code of 1986, as amended (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%
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.
(The remainder of this page intentionally left blank.)
12
<PAGE>
Stock Options
The following table sets forth certain information concerning grants of
stock options awarded to the named executive officers during fiscal 1997.
Option Grants in Last Fiscal Year
<TABLE>
<CAPTION>
POTENTIAL REALIZABLE VALUE
AT ASSUMED ANNUAL RATES
OF STOCK PRICE APPRECIATION
INDIVIDUAL GRANTS FOR OPTION TERM(3)
- --------------------------------------------------------------------------------------------- ---------------------------------
OPTIONS % OF TOTAL OPTIONS EXERCISE EXPIRATION
NAME GRANTED GRANTED TO EMPLOYEES(1) PRICE(2) DATE 5% 10%
- ---------------------------- ----------- ------------------------- ---------- ----------- ------------------- ------------
<S> <C> <C> <C> <C> <C> <C>
Donald C. Scott............. 85,962 25.0% $ 17.1875 10/15/07 $ 929,174 $ 2,354,710
Bruce A. Scott.............. 85,962 25.0 17.1875 10/15/07 929,174 2,354,710
</TABLE>
<TABLE>
<CAPTION>
<S> <C>
(1) Percentage of options granted to all employees during 1997.
(2) In each case the exercise price was based on the fair market value of a
share of Common Stock on the date of grant.
(3) Assumes compounded rates of return for the remaining life of the options
and future stock prices of $27.9966 and $44.5799 at compounded rates of
return of 5% and 10%, respectively.
</TABLE>
The following table sets forth certain information concerning exercises of
stock options by the named executive officers during the year ended December 31,
1997 and options held at December 31, 1997.
AGGREGATED OPTION EXERCISES IN LAST FISCAL YEAR
AND YEAR END OPTION VALUES
<TABLE>
<CAPTION>
VALUE OF
UNEXERCISED
NUMBER OF UNEXERCISED OPTIONS AT
SHARES OPTIONS AT YEAR END YEAR END(1)
ACQUIRED ON VALUE ------------------------------ ---------------
NAME EXERCISE REALIZED EXERCISABLE UNEXERCISABLE EXERCISABLE
- ------------------------- ----------------- ------------- --------------- ------------- ---------------
<S> <C> <C> <C> <C> <C>
Donald C. Scott.......... -- -- -- 85,962 --
Bruce A. Scott........... -- -- -- 85,962 --
</TABLE>
<TABLE>
<CAPTION>
<S> <C>
NAME UNEXERCISABLE
- ------------------------------------------- -------------
Donald C. Scott............................ $ 316,985
Bruce A. Scott............................. 316,985
</TABLE>
<TABLE>
<CAPTION>
<S> <C>
(1) Based on a per share market price of $20.875 at December 31, 1997.
</TABLE>
13
<PAGE>
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, 1997 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. As of
December 31, 1997, five of the directors and executive officers of the Company
had aggregate loan balances in excess of $60,000, which amounted to $955,000 in
the aggregate. The Company believes that such loans do not involve more than
the normal risk of collectibility.
Report of the Compensation Committee
The Compensation Committee (the "Committee") is composed entirely of
non-employee members of GS Financial Corp.'s (the "Company") Board of Directors
(the "Board"). It is the responsibility of the Committee to review and
recommend to the Board for approval changes to the Company's executive
compensation policies and programs.
The goals of the Committee are to provide an executive compensation program
which allows for the recruitment, retention and motivation of highly qualified
executives whose positions are deemed to be key to the Company's current and
future success. The Committee attempts to achieve these objectives through a
combination of base salary, cash bonus awards, and awards under the Company's
1997 Stock Option Plan and its 1997 Recognition and Retention Plan and Trust.
Base Salary. The salaries of executive officers are reviewed annually by
the Committee and are established for individual executive officers based on
subjective evaluations of individual performance and the individual's skills,
experience and background. The Committee analyzes information from several
national executive compensation survey sources for comparison of compensation
paid by institutions in the Company's peer group.
Cash Bonus Awards. The Committee considers on an annual basis whether to
pay cash bonuses to the Company's employees, including the Company's executive
officers. The Committee places significant consideration on the earnings and
income of the Company in making its determination. The Committee's objective is
to ensure the Company will remain competitive in its compensation practices and
enable it to retain qualified executive officers. The awarding of cash bonuses
is determined in the sole discretion of the Board of Directors.
Stock Options and Grants Under the Company's 1997 Recognition and Retention
Plan and Trust ("RRP"). The granting of stock options and plan share awards to
directors, executive officers and other employees of the Company are done so as
a means of providing
14
<PAGE>
long-term incentive to those individuals. The Committee believes that stock
options and awards under the RRP encourage increased performance and align the
interest of those individuals with the interests of the Company's shareholders.
The stock options and plan share awards under the RRP, which were granted in
1997, vest over a five year period at a rate of 20% per year from the date of
grant. The vesting schedule provides additional incentive to the Board and
management to remain with the Company long-term and actively participate in its
progress.
Chief Executive Officer Compensation
During 1997, Donald C. Scott served as Chairman of the Board and Chief
Executive Officer. In February 1997, the Company and Mr. Scott entered into a
three year employment agreement, with a base salary of $102,500.00. The term of
the employment agreement may be extended by the Board of Directors for
additional periods of one year. In September 1997, the Board of Directors
amended Mr. Scott's employment agreement to increase his annual base salary to
$125,000.00.
The Committee considered both quantitative and qualitative criteria in
determining an appropriate level of base compensation for the Chief Executive
Officer ("C.E.O.") and other executive officers. The quantitative factors
consist of, but are not limited to, net income of the Company, profitability
ratios, asset growth and quality, the performance of the common stock of the
Company and comparisons with the compensation levels of other C.E.O.'s of
financial institutions in the Company's peer group. The qualitative factors
reviewed include leadership and management skills of the C.E.O., satisfactory
regulatory examinations, success of the stock conversion, the fluency of the
transition from mutual to stock organization, and maintenance of relationships
with investors, customers, analysts and industry regulators. Although no
specific weight is assigned to any of these factors, all are incorporated into a
determination regarding the level at which to set, and the amount by which to
change, the base compensation of executive officers.
In conjunction with the conversion and initial public offering, in 1997,
Mr. Donald Scott was awarded stock options of 85,962 shares of common stock of
GS Financial Corp., exercisable at a rate of 20% per year from the date of
grant, October 15, 1997. Mr. Donald Scott was granted 34,385 shares of
restricted Common Stock pursuant to the Company's RRP on October 15, 1997, which
are earned at a rate of 20% per year from the date of grant.
Kenneth B. Caldcleugh
Stephen L. Cory
J. Scott Key
Dr. Mannie D. Paine, Jr.
15
<PAGE>
Performance Graph
The following graph compares the cumulative total return relating to the
Common Stock since the Company's initial public offering of its Common Stock
on April 1, 1997 with (i) the cumulative total return on the stocks included
in the National Association of Securities Dealers, Inc. Automated Quotation
("Nasdaq") Stock Market Index (for United States companies), and (ii) the
cumulative return on the stocks in the SNL -LESS THAN-$250M Thrift Index.
All of these cumulative returns are computed assuming the reinvestment of
dividends at the frequency with which dividends were paid during the
applicable period.
[Tabular information immediately below is depicted graphically here]
Period Ending
<TABLE>
<CAPTION>
Index 4/1/97 6/30/97 9/30/97 12/31/97
- ----- ------ ------- ------- --------
<S> <C> <C> <C> <C>
GS Financial Corp. 100.00 114.95 122.98 158.30
NASDAQ - Total US 100.00 118.90 139.01 130.37
SNL -LESS THAN-$250M
Thrift Index 100.00 108.97 130.11 143.24
</TABLE>
16
<PAGE>
The above graph represents $100 invested in the Company's initial public
offering of Common Stock on April 1, 1997 at $10.00 per share. The Common Stock
commenced trading on the Nasdaq National Market on April 1, 1997 at $13.00 per
share.
RATIFICATION OF APPOINTMENT OF AUDITORS
The Board of Directors of the Company has appointed LaPorte, Sehrt, Romig &
Hand, independent certified public accountants, to perform the audit of the
Company's financial statements for the year ending December 31, 1998, and
further directed that the selection of auditors be submitted for ratification by
the stockholders at the Annual Meeting.
The Company has been advised by LaPorte, Sehrt, Romig & Hand that neither
that firm nor any of its associates has any relationship with the Company or its
subsidiaries other than the usual relationship that exists between independent
certified public accountants and clients. LaPorte, Sehrt, Romig & Hand will
have one or more representatives at the Annual Meeting who will have an
opportunity to make a statement, if they so desire, and will be available to
respond to appropriate questions.
The Board of Directors recommends that you vote FOR the ratification of the
appointment of LaPorte, Sehrt, Romig & Hand as independent auditors for the
fiscal year ending December 31, 1998.
STOCKHOLDER PROPOSALS
Any proposal which a stockholder wishes to have included in the proxy
materials of the Company relating to the next annual meeting of stockholders of
the Company, which is scheduled to be held in April, 1999, 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 30, 1998. 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.
Stockholder Proposals which are not submitted for inclusion in the
Company's proxy materials pursuant to Rule 14a-8 under the Exchange Act may be
brought before an annual meeting pursuant to Article 9.D. of the Company's
Articles of Incorporation.
ANNUAL REPORTS
A copy of the Company's Annual Report to Stockholders for the year ended
December 31, 1997 accompanies this Proxy Statement. Such annual report is not
part of the proxy solicitation materials.
17
<PAGE>
OTHER MATTERS
Management is not aware of any business to come before the Annual 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 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.
By Order of the Board of Directors
/s/ Donald C. Scott
---------------------------------------
Donald C. Scott
Chairman of the Board
March 30, 1998
18
<PAGE>
Form of Proxy
REVOCABLE PROXY
GS FINANCIAL CORP.
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS OF GS FINANCIAL
CORP. FOR USE AT THE ANNUAL MEETING OF SHAREHOLDERS TO BE HELD ON APRIL 28, 1998
AND AT ANY ADJOURNMENT THEREOF.
The undersigned hereby appoints J. Scott Key, Bruce A. Scott and Lettie R.
Moll as proxies, each with power to appoint his substitute, and hereby
authorizes them to represent and vote, as designated below, all the shares of
Common Stock of GS Financial Corp. (the "Company") held of record by the
undersigned on March 16, 1998 at the Annual Meeting of Shareholders to be held
at the Company's corporate headquarters located at 3798 Veterans Memorial
Boulevard, Metairie, Louisiana 70002, on Tuesday, April 28, 1998, at 10:00 a.m.,
Central Time, and any adjournment thereof.
1. ELECTION OF DIRECTORS FOR THREE-YEAR TERM
/ / FOR all nominees listed below / / WITHHOLD AUTHORITY
(except as marked to the to vote for all
contrary below) nominees listed
below
Nominees for three-year term expiring in 2001:
Victor Kirschman, Mannie D. Paine, Jr. and Donald C. Scott.
(Instruction: To withhold authority to vote for any individual nominee, write
that nominee's name in the space provided below.)
_____________________________________________________________________________
2. PROPOSAL TO RATIFY THE APPOINTMENT by the Board of Directors of LaPorte,
Sehrt, Romig & Hand as the Company's independent auditors for the year ending
December 31, 1998
/ / FOR / / AGAINST / / ABSTAIN
3. In their discretion, the proxies are authorized to vote upon such other
business as may properly come before the meeting.
(Continued on reverse side)
<PAGE>
THIS PROXY IS SOLICITED BY THE BOARD OF DIRECTORS. THE SHARES OF THE
COMPANY'S COMMON STOCK WILL BE VOTED AS SPECIFIED. IF NOT OTHERWISE SPECIFIED,
THIS PROXY WILL BE VOTED FOR THE ELECTION OF THE BOARD OF DIRECTORS' NOMINEES TO
THE BOARD OF DIRECTORS, FOR THE RATIFICATION OF AUDITORS IN PROPOSAL 2 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 ANNUAL MEETING.
Dated:______________________________, 1998
---------------------------------------
---------------------------------------
Signatures
Please sign this proxy exactly as your names(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.
- --------------------------------------------------------------------------------
<PAGE>
[GS FINANCIAL CORP.]
March __, 1998
To: Participants in the Company's Employee Stock Ownership Plan
As described in the attached materials, your proxy as a shareholder of GS
Financial Corp. (the Company") is being solicited in connection with the
proposals to be considered at the Company's upcoming Annual Meeting of
Shareholders. We hope you will take advantage of the opportunity to direct the
manner in which shares of Common Stock of the Company allocated to your account
pursuant to the Company's Employee Stock Ownership Plan ("ESOP") will be voted.
Enclosed with this letter is the Proxy Statement, which describes the
matters to be voted upon, and a voting instruction ballot, which will permit you
to vote the shares in your account. After you have reviewed the Proxy
Statement, we urge you to vote your restricted shares held pursuant to the ESOP
by marking, dating, signing and returning the enclosed voting instruction ballot
to the administrators of the ESOP. The Plan Administrators will certify the
totals to the ESOP Trustee for the purpose of having those shares voted by the
Trustees.
We urge each of you to vote, as a means of participating in the governance
of the affairs of the Company. If your voting instructions for the ESOP are not
received, the shares allocated to your account will be voted in the same
proportion as all allocated shares under the ESOP are voted. While I hope that
you will vote in the manner recommended by the Board of Directors, the most
important thing is that you vote in whatever manner you deem appropriate.
Please take a moment to do so.
Please note that the enclosed material relates only to those shares which
have been allocated to you under the ESOP. You will receive other voting
material for those shares owned by you individually and not under the ESOP.
Sincerely,
Donald C. Scott
President and
Chief Executive Officer
<PAGE>
GS FINANCIAL CORP.
The undersigned hereby instructs the Trustee of the Employee Stock
Ownership Plan and Trust ("ESOP") of GS Financial Corp. (the "Company") to vote,
as designated below, all the shares of Common Stock of the Company allocated to
my account pursuant to the ESOP as of March 16, 1998 at the Annual Meeting of
Shareholders to be held at the Company's corporate headquarters located at 3798
Veterans Memorial Boulevard, Metairie, Louisiana, 70002, on Tuesday, April 28,
1998, at 10:00 a.m., Central Time, and any adjournment thereof.
1. ELECTION OF DIRECTORS FOR THREE-YEAR TERM
/ / FOR all nominees listed below / / WITHHOLD AUTHORITY
(except as marked to the to vote for all
contrary below) nominees listed
below
Nominees for three-year term expiring in 2001:
Victor Kirschman, Mannie D. Paine, Jr. and Donald C. Scott.
(Instruction: To withhold authority to vote for any individual nominee, write
that nominee's name in the space provided below.)
- ------------------------------------------------------------------------------
2. PROPOSAL TO RATIFY THE APPOINTMENT by the Board of Directors of LaPorte,
Sehrt, Romig & Hand as the Company's independent auditors for the year ending
December 31, 1998.
/ / FOR / / AGAINST / / ABSTAIN
3. In its discretion, the Trustee is authorized to vote upon such other
business as may properly come before the meeting.
The Company's Board of Directors recommends a vote FOR the Board's nominees
for director and FOR Proposal 2. Such votes are hereby solicited by the
Company's Board of Directors.
Dated: ____________________ , 1998
---------------------------------
Signature
If you return this card properly signed but you do not otherwise specify, shares
will be voted for the Board of Directors' nominees for director and for Proposal
2. If you do not return this card, your shares will be voted by the Trustee in
the same proportion as all allocated shares under the ESOP are voted.
