<PAGE> 1
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
/X/ Definitive Proxy Statement
/ / Definitive Additional Materials
/ / Soliciting Material Pursuant to sec. 240.14a-11(c) or sec. 240.14a-12
GOLDEN WEST FINANCIAL CORPORATION
- --------------------------------------------------------------------------------
(Name of Registrant as Specified in its Charter)
J. L. HELVEY, GROUP SENIOR VICE PRESIDENT
- --------------------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement)
Payment of Filing Fee (Check the appropriate box):
/X/ $125 per Exchange Act Rules 0-11(c)(1)(ii), 14a-6(i)(1), or 14a-6(j)(2).
/ / $500 per each party to the controversy pursuant to Exchange Act Rule
14a-6(i)(3).
/ / Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and 0-11.
1) Title of each class of securities to which transaction applies:
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2) Aggregate number of securities to which transaction applies:
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3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11:
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4) Proposed maximum aggregate value of transaction:
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Set forth the amount on which the filing fee is calculated and state how it
was determined.
/ / 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:
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4) Date Filed:
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<PAGE> 2
[GOLDEN WEST FINANCIAL CORPORATION LOGO]
March 10, 1995
Dear Stockholder:
The Annual Meeting of Stockholders of Golden West Financial Corporation
will be held May 2, 1995, at 11:00 a.m. on the fourth floor of the Company's
headquarters located at 1901 Harrison Street, Oakland, California. The
management and directors of Golden West Financial Corporation look forward to
meeting with you at that time.
Attached to this letter is the formal notice of meeting and proxy
statement. We urge you to complete and return the enclosed proxy immediately. A
prepaid return envelope is provided for that purpose. If you attend the meeting,
you may withdraw your previously mailed proxy and vote at the meeting.
Sincerely yours,
<TABLE>
<S> <C>
[SIG] [SIG]
HERBERT M. SANDLER MARION O. SANDLER
Chairman of the Board and Chairman of the Board and
Chief Executive Officer Chief Executive Officer
</TABLE>
<PAGE> 3
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
OF
GOLDEN WEST FINANCIAL CORPORATION
The Annual Meeting of Stockholders of Golden West Financial Corporation
(the "Company") will be held on the fourth floor of the Company's headquarters
located at 1901 Harrison Street, Oakland, California on Tuesday, May 2, 1995, at
11:00 a.m. for the following purposes:
(1) To elect three members of the Board of Directors to hold office for
three-year terms and until their successors are duly elected and
qualified;
(2) To ratify the selection of independent auditors; and
(3) To transact such other business as may properly come before the
meeting or any adjournment thereof.
The close of business on March 1, 1995 has been fixed as the record date
for the determination of stockholders entitled to notice of and to vote at this
meeting or any adjournment thereof. A list of such stockholders will be
available at the time and place of the meeting and, during ten days prior to the
meeting, at the office of the Secretary of Golden West Financial Corporation,
1901 Harrison Street, Oakland, California.
By order of the Board of Directors.
[SIG]
ROBERT C. ROWE
Vice President and Secretary
March 10, 1995
IMPORTANT: TO ASSURE YOUR REPRESENTATION AT THE MEETING, PLEASE COMPLETE, DATE,
SIGN AND MAIL THE ENCLOSED PROXY PROMPTLY IN THE RETURN ENVELOPE
WHICH HAS BEEN PROVIDED.
<PAGE> 4
PROXY STATEMENT
The enclosed proxy is solicited on behalf of the Board of Directors of
Golden West Financial Corporation (the "Company") to be used at the Annual
Meeting of Stockholders on May 2, 1995 for the purposes set forth in the
foregoing notice. Any stockholder may revoke his proxy at any time prior to
exercise by filing with the Secretary of the Company a written revocation or
duly executed proxy bearing a later date, or upon request if such stockholder is
present at the meeting and chooses to vote in person.
The expense of soliciting proxies will be paid by the Company. Proxies may
be solicited by regular employees of the Company personally or by telephone or
telegraph, and the Company will upon request reimburse persons holding shares in
their names, or the name of their nominees, but not owning the shares
beneficially, for reasonable expenses of forwarding proxy materials to their
principals.
The principal executive offices of the Company are located at 1901 Harrison
Street, Oakland, California 94612. This Proxy Statement and the enclosed Proxy
are being sent or given to stockholders commencing March 10, 1995.
VOTING SECURITIES
Only stockholders of record on the books of the Company as of 5:00 p.m.,
March 1, 1995, will be entitled to vote at the Annual Meeting. As of the close
of business on March 1, 1995, there were outstanding 58,582,105 shares of Common
Stock of the Company, $.10 par value. Stockholders are entitled to one vote for
each share held except that, in the election of directors, each stockholder has
cumulative voting rights and is entitled to as many votes as equal the number of
shares held by such stockholder multiplied by the number of directors to be
elected (three), which votes may be cast for a single candidate or distributed
among any or all candidates as such stockholder sees fit. The three candidates
for director receiving the highest number of votes shall be elected. Consistent
with Delaware law, abstentions and broker non-votes will not be counted, except
that shares owned by stockholders submitting signed proxies will be counted for
the purpose of determining whether a quorum of stockholders is present at the
Annual Meeting.
ELECTION OF DIRECTORS
Pursuant to Article Seventh of the Company's Certificate of Incorporation,
the Board of Directors is divided into three classes, each of which consists of
three directors. The second class of directors is being elected at the 1995
Annual Meeting and will serve until the 1998 Annual Meeting. The third class of
directors will serve until the 1996 Annual Meeting and the first class of
directors will serve until the 1997 Annual Meeting.
Three directors are to be elected at the 1995 Annual Meeting. Patricia A.
King, Paul Sack, and Marion O. Sandler are nominees for directors. Mr. Sack and
Mrs. Sandler were elected directors by a vote of the stockholders at the 1992
Annual Meeting of Stockholders. Ms. King was appointed by the Board of Directors
in October, 1994 to fill a vacancy created by the resignation of a director from
the third class of directors. In connection with the resignation of a director
from the second class during 1995, Ms. King resigned from the third class and
was appointed to the second class of directors to fill the vacancy and to
complete the term of the resigned director, thereby joining the class of
directors which is subject to election at the 1995 Annual Meeting. Ms. King has
been a professor of law at Georgetown University in Washington, D.C. since 1988
and an adjunct professor of the Department of Health and Policy Management in
the School of Hygiene and Public Health at Johns Hopkins University in
Baltimore, Maryland since 1990.
In the absence of instructions to the contrary, shares represented by the
enclosed proxy will be voted FOR the election of the above nominees to the Board
of Directors. If any of such persons are unable or unwilling to be nominated for
the office of director at the date of the Annual Meeting, or any adjournment
thereof, the proxy holders will vote for such substitute nominees as the
Company's Board of Directors may propose. The management has no reason to
believe that any of such nominees will be unable or unwilling to serve if
elected a director. Notwithstanding the foregoing, if one or more persons other
than those named above are nominated as candidates for the office of director,
the proxy holders may cumulate votes and the enclosed proxy may be voted in
favor of any one or more of the nominees named above, to the exclusion of
others, and in such order of preference as the proxy holders may determine in
their discretion.
1
<PAGE> 5
Set forth below is certain information concerning the nominees and the
members of the Board of Directors who will continue in office after the 1995
Annual Meeting:
<TABLE>
<CAPTION>
COMMON STOCK BENEFICIALLY
OWNED AS OF
FEBRUARY 28, 1995(1)
CONTINUING DIRECTORS BUSINESS EXPERIENCE SERVED AS ---------------------------
AND NOMINEES FOR DURING PAST FIVE YEARS DIRECTOR NUMBER PERCENT
DIRECTOR (CLASS) AND OTHER INFORMATION SINCE AGE OF SHARES OF CLASS
- --------------------------- ----------------------------- --------- --- ---------- ----------
<S> <C> <C> <C> <C> <C>
Louis J. Galen (III) Retired (Since 1982) Company 1959 69 1,205,636(2) 2.1%
Officer, Private Investor;
Director of Trans World Bank
Patricia A. King (II) Professor of Law, Georgetown 1994 52 -- --
University, Washington, D.C.;
Adjunct Professor, Department
of Health Policy and
Management, School of Hygiene
and Public Health, Johns
Hopkins University
William D. McKee (I) Retired (Since 1988) Partner, 1970 68 97,633(3) .2%
Orrick, Herrington &
Sutcliffe, Law Firm
Bernard A. Osher (III) Chairman, Butterfield and 1970 67 3,586,650 6.1%
Butterfield, Auctioneers
Kenneth T. Rosen (I) Professor of Business 1984 46 3,000 --
Administration, Haas School
of Business; Chairman of the
Center for Real Estate and
Urban Economics, University
of California, Berkeley
Paul Sack (II) Principal, The Paul Sack 1989 67 6,200 --
Properties, Real Estate
Investment and Private
Management Company
Herbert M. Sandler (I)(4) Chairman of the Board and 1963 63 5,254,520(5)(6) 9.0%
Chief Executive Officer of
the Company and World Savings
and Loan Association
Marion O. Sandler (II)(4) Chairman of the Board and 1963 64 5,610,530(5)(7) 9.6%
Chief Executive Officer of
the Company and World Savings
and Loan Association
All directors and officers as a group (13 persons) 11,664,274(8) 19.9%
</TABLE>
- ---------------
(1) Held directly with sole voting and investment powers unless otherwise noted,
subject to community property laws where applicable.
(2) Includes 1,157,636 shares held jointly, with shared voting and investment
powers, by Mr. Galen and his spouse, as co-trustees. Also includes 48,000
shares, with shared voting and investment powers, held in a charitable trust
for which Mr. Galen is trustee.
(3) Includes 13,896 shares held jointly, with shared voting and investment
powers, by Mr. McKee and his spouse, as co-trustees. Also includes 83,737
shares held in trust for the benefit of Mr. McKee and members of his family.
(4) Member of the Executive Committee.
(5) Includes for both Herbert M. Sandler and Marion O. Sandler, husband and
wife, 4,635,620 shares, with shared voting and investment powers, held
jointly by Mr. and Mrs. Sandler, as co-trustees.
(6) Includes for Herbert M. Sandler 900 shares with voting and investment powers
in trust for the benefit of his sister-in-law, 163,208 shares with shared
voting and investment powers held in trusts for the benefit of Mr. and Mrs.
Sandler's descendents with Mr. and Mrs. Sandler as co-trustees, and 608,700
shares which
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<PAGE> 6
Mr. Sandler may acquire upon exercise of employee stock options exercisable
on February 28, 1995, or within 60 days thereafter.
(7) Includes for Marion O. Sandler 30,060 shares with voting and investment
powers in trust for the benefit of herself and descendents, 356,580 shares
with voting and investment powers held in trusts for the benefit of Mr. and
Mrs. Sandler's descendents, 163,208 shares with shared voting and investment
powers held in trusts for the benefit of Mr. and Mrs. Sandler's descendents
with Mr. and Mrs. Sandler as co-trustees, and 562,410 shares which Mrs.
Sandler may acquire upon exercise of employee stock options exercisable on
February 28, 1995, or within 60 days thereafter.
(8) Includes 6,564,769 shares as to which officers and directors share with
others voting and/or investment powers. Also includes 1,456,735 shares which
certain officers may acquire upon the exercise of employee stock options
exercisable on February 28, 1995, or within 60 days thereafter.
The continuing directors and nominees for elections as directors have had
the principal occupations or employments set forth in the foregoing table for at
least the past five years, except for Marion O. Sandler who was President and
Chief Executive Officer of the Company and World Savings and Loan Association
until January 1993 at which time she became Chairman of the Board and Chief
Executive Officer of the Company and World Savings and Loan Association along
with Herbert M. Sandler. Paul Sack was a principal and partner in RREEF Funds, a
real estate investment management company, until he retired in 1992 at which
time Mr. Sack resumed his active participation in The Paul Sack Properties, a
real estate company which he started in 1959.
Herbert M. Sandler and Marion O. Sandler are husband and wife. Bernard A.
Osher is the brother of Mrs. Sandler. Herbert M. Sandler, Marion O. Sandler and
Bernard A. Osher may be deemed to be "control" persons of the Company, within
the meaning of the General Rules and Regulations adopted by the Securities and
Exchange Commission under the Securities Exchange Act of 1934. The business
address for Mr. and Mrs. Sandler is 1901 Harrison Street, Oakland, California
94612. The business address for Mr. Osher is 220 San Bruno Avenue, San
Francisco, California 94103.
During 1994, the Company's Board of Directors held four meetings. The Board
of Directors has standing Nomination, Audit and Compensation Committees. The
members of the Nominating Committee in 1994 were William Patrick Kruer, Kenneth
T. Rosen and Paul Sack. The Nominating Committee's principal function is to
identify and propose to the Board qualified individuals as potential candidates
for the position of Director. The Nominating Committee does not consider
recommendations from stockholders for nominations for Director. The members of
the Audit Committee in 1994 were Louis J. Galen, William D. McKee and Kenneth T.
Rosen. The principal function of the Audit Committee is to assist the Board of
Directors in reviewing the financial statements of the Company and its
subsidiaries as issued to its stockholders and others. Such Committee held four
meetings of its members during 1994. The members of the Compensation Committee
in 1994 were William Patrick Kruer, Kenneth T. Rosen and Paul Sack. Mr. Kruer
resigned from the Board of Directors in February 1995. The report of the
Compensation Committee is set forth below:
COMPENSATION COMMITTEE REPORT ON EXECUTIVE COMPENSATION
To the Board of Directors:
The Compensation Committee's primary function is to review and recommend,
for review by the Board of Directors, the salaries and other compensation of the
Company's senior executive officers. In addition, the Compensation Committee
serves as the Company's Stock Option Committee which approves the grants of
stock options pursuant to the Company's Stock Option Plan, including grants of
stock options to executive officers of the Company. The Compensation Committee
met in April of 1994 to recommend to the Board of Directors salaries and stock
options, for the period May 1, 1994 through April 30, 1995, for the Company's
chief executive officers ("Chief Executive Officers"), and its President and
Senior Executive Vice President (together with the Chief Executive Officers, the
"Senior Executive Officers"). The cash compensation of the Company's other
executive officers was determined through normal annual reviews by their
managers, who included one or more of the Chief Executive Officers, the
President, or the Senior Executive Vice President. The compensation of each such
officer was determined in those reviews with reference to the officer's
3
<PAGE> 7
individual performance in his area of responsibility and the manager's
assessment of his contribution to the performance of the Company. The
Compensation Committee also met in December 1994, in its capacity as the
Company's Stock Option Committee, and considered grants of stock options to
executive officers other than the Senior Executive Officers.
COMPENSATION GOALS AND APPROACH
The Committee's goals were to provide compensation that: (a) reflects both
the Company's and the executives' performance; (b) compares reasonably with
compensation in the relevant market; and (c) attracts and retains high quality
executives. In its evaluation of executive compensation for the Senior Executive
Officers, the Committee considered factors relating to the Company's
performance, compared to a peer group, and the compensation of the Company's
Senior Executive Officers relative to the compensation of executives in the peer
group. The peer group included the top performing regional bank holding
companies (BANC ONE Corp., BankAmerica Corp., Boatmen's Bancshares, Corestates
Financial Corp., First Bank System, First Chicago Corp., First Union
Corporation, National City Corp., NationsBank Corp., NBD Bancorp Inc., Norwest
Corp., PNC Financial Corp., Republic New York Corp., SunTrust Banks, Inc., U.S.
Bancorp and Wachovia Corp.) and two savings and loan holding companies (H.F.
Ahmanson & Co. and Great Western Financial Corporation). Each company in the
peer group, except H.F. Ahmanson & Co. and Great Western Financial Corporation,
was included in the list of companies reflected in the Common Stock Performance
Graph in the proxy statement for the Company's 1994 Annual Meeting. H.F.
Ahmanson & Co. and Great Western Financial Corporation were added to the peer
group for the purposes of the Committee's analysis because they are the two
largest savings and loan holding companies in the nation.
The Committee considered several measures of performance in evaluating the
Company's performance relative to the peer group, including: total assets; net
earnings; return on average assets; return on average equity; capital levels;
the ratio of non-performing assets ("NPAs") and troubled debt restructured
("TDRs") to period-end loans; the ratio of net charge-offs to average loans and
leases; loan loss coverage; the ratio of general and administrative expenses
("G&A") to interest income and other income; the ratio of non-interest expenses
to pretax earnings; and the ratio of pretax earnings to net interest income and
non-interest income. In addition, in evaluating compensation, the Committee also
considered other factors, including: the attainment of long-term plans and
budgets; the attainment of goals and objectives; the attainment of credit
ratings by nationally-recognized rating services; the attainment of regulatory
examination ratings by the Company and its principal operating subsidiary, World
Savings and Loan Association; the attainment of regulatory capital standards by
World Savings and Loan Association; the strategic accomplishments of the
Company; and the general assessment of the executives by peers, equity analysts
and others.
With respect to total compensation, the Committee considered annual
compensation of the Company's Senior Executive Officers relative to executives
in the peer group, for the period 1991 through 1993, including: (i) salary,
bonuses and other forms of cash compensation; and (ii) equity-based
compensation, including restricted stock and stock options. In general, the
Committee concluded that while exact comparisons could not be made, the
compensation of the Company's Senior Executive Officers for the period in
question was in accordance with compensation for the peer group.
The Committee, in its role as the Company's Stock Option Committee, also
considered stock option awards for the Company's executive officers. In general,
each executive officer's eligibility for and the amount of those awards were
determined considering such officer's performance, the amount of options
previously granted and the Company's objectives of encouraging strong
performance in the future, providing an opportunity for employees to acquire a
proprietary interest in the Company and encouraging employees to remain in the
employ of the Company.
TAX DEDUCTIBILITY OF EXECUTIVE COMPENSATION
Section 162(m) of the Internal Revenue Code limits the federal income tax
deductibility of compensation paid to the Company's Chief Executive Officer and
to each of the other four most highly compensated executive officers. The
Company generally may deduct compensation paid to such an officer only if the
4
<PAGE> 8
compensation does not exceed $1 million during any fiscal year or is
"performance-based" as defined in section 162(m). At present, the Committee
believes that the Company will not be affected by section 162(m) because no
Company executive currently receives cash compensation in excess of $1 million,
and any compensation paid pursuant to the Company's Stock Option Plan qualifies
for continued deductibility pursuant to the transition rules applicable under
section 162(m). In the future, the Committee will monitor the levels of
executive compensation and consider taking appropriate steps to ensure the
continued tax deductibility of executive compensation.
1994 COMPENSATION FOR THE CHIEF EXECUTIVE OFFICERS
In setting the salary and stock option awards for the Chief Executive
Officers, the Committee took into account the Company's performance in return on
average equity; return on average assets; ratio of Tier 1 capital to total
assets; ratio of Total Risk-Weighted capital to assets; ratio of NPAs and TDRs
to period-end loans; ratio of net charge-offs to average loans; loan loss
coverage ratio; ratio of G&A to net interest income and other income; ratio of
non-interest expense to pretax earnings; and ratio of pretax earnings to net
interest income and non-interest income.
In considering the compensation of the Chief Executive Officers, the
Committee also considered the attainment of goals and objectives and plans and
budgets in key areas of operations, including expense control, loan production,
asset quality, branch network growth and capital growth. The Committee also
considered the generally favorable results attained by the Company and its
principal operating subsidiary, World Savings and Loan Association, during
examinations by the Office of Thrift Supervision. The Committee also
acknowledged the continued recognition of the Chief Executive Officers by the
business press, equity analysts and others, with respect to the performance of
the Chief Executive Officers and their contributions to the performance of the
Company.
The Committee considered the foregoing factors as a group without assigning
relative weight to any one factor over another. Based upon its review of the
Company's performance and the performance of the Chief Executive Officers, the
Committee arrived at recommendations with respect to salaries and stock option
awards.
The Committee also evaluated the recommended compensation of the Chief
Executive Officers by comparing their compensation for the period 1991 through
1993 to that of chief executive officers of companies in the peer group over the
comparable period. The Committee recognized that the Chief Executive Officers'
compensation included only salary and stock option components, while the
components of chief executive officer compensation for the peer group included
not only salary and stock options but also included other forms of cash
compensation, such as bonuses and long-term incentives, and other forms of
stock-based compensation, such as restricted stock. These differences in the
form of compensation received by the Chief Executive Officers and that received
by chief executives of companies in the peer group made exact comparisons
difficult; however, the Committee reached certain general conclusions regarding
the Chief Executive Officers' compensation.
In general, the trends in the increase in the Chief Executive Officers'
cash compensation for the period reviewed were consistent with such trends in
the peer group. Further, for a number of the chief executives of companies in
the peer group, the total amount of cash compensation received significantly
exceeded the cash compensation of the Chief Executive Officers. In addition, the
number of stock options awarded to the Chief Executive Officers had in a number
of cases been lower than awards made to chief executives of companies in the
peer group. Further, the Committee noted that the Chief Executive Officers had
not been awarded forms of stock-based compensation other than stock options,
while a number of the chief executives of companies in the peer group had
benefited from other forms of such compensation.
The Committee concluded, after reviewing this data, that the compensation
of the Chief Executive Officers for the period 1991 through 1993 was in
accordance with the compensation for executives of companies in the peer group
for the comparable period.
5
<PAGE> 9
Based upon its review of the Company's performance and the performance of
the Chief Executive Officers, and considering the level of compensation of the
Chief Executive Officers compared to the peer group, the Committee concluded
that the recommendations it had arrived at were consistent with the Committee's
traditional approach to executive compensation and were appropriate in a
comparative context. Accordingly, the Committee determined to recommend to the
Board of Directors salaries and stock option grants, for the period May 1, 1994
through April 30, 1995, in the amounts reflected in the Summary Compensation
Table located elsewhere in this proxy statement.
COMPENSATION COMMITTEE
William Patrick Kruer, Chairman
Kenneth T. Rosen
Paul Sack
SECURITIES EXCHANGE ACT OF 1934
Section 16(a) of the Securities Exchange Act of 1934 requires the Company's
officers and directors, and persons who own more than ten percent of a
registered class of the Company's equity securities, to file reports of
ownership and changes in ownership with the Securities and Exchange Commission
(the "SEC").
Based solely on the Company's review of such reports and written
representations from certain persons that certain of such reports were not
required to be filed by such persons, no officer, director or person who owns
more than ten percent of a registered class of the Company's equity securities
failed to file on a timely basis reports required by Section 16(a) of the
Securities Exchange Act of 1934 during the year ended December 31, 1994, except
that a Form 4 with respect to Mr. Judd regarding activity in August 1994 was
prepared and signed by Mr. Judd in a timely manner but was submitted late as a
result of a clerical oversight.
6
<PAGE> 10
SECURITIES OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
The following table sets forth the beneficial ownership, as of the dates
indicated, of each stockholder other than Herbert M. Sandler, Marion O. Sandler,
and Bernard A. Osher, known to the Company to be beneficial owner of more than
5% of the Company's Common Stock. The table also sets forth the beneficial
ownership, as of February 28, 1995 of each of the executive officers named in
the Summary Compensation Table located elsewhere in this proxy statement who are
not also directors of the Company.
<TABLE>
<CAPTION>
AMOUNT AND NATURE PERCENT OF
NAME AND ADDRESS OF BENEFICIAL OWNER OF BENEFICIAL OWNERSHIP CLASS
- -------------------------------------- ----------------------- ----------------
<S> <C> <C>
The Capital Group Companies, Inc...... 4,510,600(1) 7.7%
333 South Hope Street
Los Angeles, CA 90071
FMR Corp.............................. 5,548,351(2) 9.5%
82 Devonshire Street
Boston, MA 02109
Wellington Management Company/........ 6,406,500(3)(5) 10.9%
Thorndike, Paine & Lewis
75 State Street
Boston, MA 02109
The Windsor Funds, Inc.,.............. 6,222,400(4)(5) 10.6%
a member of the Vanguard Group
of Investment Companies
Vanguard Financial Center
Valley Forge, PA 19482
James T. Judd......................... 72,000(6) .1%
Senior Executive Vice President
of the Company and President and
Chief Operating Officer of
World Savings and Loan Association
1901 Harrison Street
Oakland, CA 94612
Russell W. Kettell.................... 386,050(6) .7%
President of the Company and
Senior Executive Vice President of
World Savings and Loan Association
1901 Harrison Street
Oakland, CA 94612
Dirk S. Adams......................... 20,700(6) --
Group Senior Vice President
of the Company and
World Savings and Loan Association
1901 Harrison Street
Oakland, CA 94612
</TABLE>
- ---------------
(1) Includes 4,510,600 shares with sole disposition power and 1,614,800 with
sole voting power, based upon SEC Schedule 13G dated February 8, 1995.
(2) Includes 5,548,351 shares with sole disposition power and 177,851 shares
with sole voting power, based upon SEC Schedule 13G dated February 13, 1995.
(3) Includes 6,406,500 shares with shared disposition power and 116,400 with
shared voting power, based upon SEC Schedule 13G dated January 25, 1995.
(4) Includes 6,222,400 shares with shared disposition power and 6,222,400 with
sole voting power, based upon SEC Schedule 13G dated February 10, 1995.
(5) The shares reported by the Windsor Fund are also included in those reported
by Wellington Management Company.
(6) Includes 52,000, 186,000, and 16,700 shares which Messrs. Judd, Kettell, and
Adams, respectively, may acquire upon exercise of employee stock options
exercisable on February 28, 1995 or within 60 days thereafter.
7
<PAGE> 11
EXECUTIVE COMPENSATION
COMPENSATION OF EXECUTIVE OFFICERS
The cash compensation paid to each of the two Chief Executive Officers and
to the three most highly compensated executive officers of the Company, for
services in all capacities to the Company and its subsidiaries is set forth
below:
SUMMARY COMPENSATION TABLE
FOR THE YEARS ENDED DECEMBER 31, 1994, 1993 AND 1992
<TABLE>
<CAPTION>
LONG TERM
ANNUAL COMPENSATION COMPENSATION
------------------------------------------ ------------
OTHER ANNUAL ALL OTHER
COMPENSATION OPTIONS COMPENSATION
NAME AND PRINCIPAL POSITION YEAR SALARY($)(A) ($)(B) (#)(C) ($)(D)
- ----------------------------------- ---- ------------ ------------- ------- ------------
<S> <C> <C> <C> <C> <C>
HERBERT M. SANDLER 1994 $889,704 $11,613 35,000 $5,201
Chairman of the Board and Chief 1993 847,833 8,657 35,000 5,078
Executive Officer of the Company 1992 808,333 5,206 -- 4,945
and World Savings and Loan
Association
MARION O. SANDLER 1994 889,704 11,344 35,000 5,201
Chairman of the Board and Chief 1993 847,833 8,313 35,000 5,078
Executive Officer of the Company 1992 808,333 4,997 -- 4,945
and World Savings and Loan
Association
JAMES T. JUDD 1994 631,192(E) 6,419 17,500 5,201
Senior Executive Vice President 1993 605,896(E) 7,136 17,500 5,078
of the Company and President and 1992 591,885(E) 7,193 -- 4,945
Chief Operating Officer of World
Savings and Loan Association
RUSSELL W. KETTELL 1994 482,288 1,188 17,500 5,201
President of the Company and 1993 459,320 2,989 17,500 5,078
Senior Executive Vice President 1992 437,447 2,930 -- 4,945
of World Savings and Loan
Association
DIRK S. ADAMS 1994 282,852 1,968 3,000 5,201
Group Senior Vice President of 1993 270,672 1,907 2,500 5,078
the Company and World Savings and 1992 255,348 1,579 9,000 4,945
Loan Association
</TABLE>
- ---------------
(A) Amounts shown include cash compensation earned and received by executive
officers.
(B) Amounts are for cash reimbursement for income taxes incurred by individuals
on fringe benefits.
(C) Options granted are under the Company's 1987 Stock Option Plan which
provides for the issuance of both incentive stock options and nonqualified
stock options.
(D) Amounts shown in this column represent Company contributions on behalf of
each of these officers to the Company's 401(K) plan, $4,620 (1994), $4,497
(1993) and $4,364 (1992), and payments by the Company for term life
insurance for executive officers in excess of their individual
contributions, $581 (1994, 1993 and 1992).
(E) Amounts for Mr. Judd also include $100,000 in each year, which amounts were
vested and available to be paid to Mr. Judd at his election pursuant to a
deferred compensation agreement. Such amount was received during 1992; in
1994 he elected to receive only $91,663 and in 1993 he elected to receive
only $66,667.
INDEBTEDNESS OF MANAGEMENT
During 1994, J. L. Helvey, Group Senior Vice President of the Company and
World Savings and Loan Association, was indebted to the Company for a
residential loan. The largest aggregate balance outstanding
8
<PAGE> 12
from January 1, 1994 to February 28, 1995 was $138,337. The annual interest rate
charged on this indebtedness was from 4.88% to 5.62%. The amount of indebtedness
outstanding at February 28, 1995 was $132,485.
DEFERRED COMPENSATION
The Company has entered into deferred compensation agreements with certain
of the key employees of the Company and its subsidiaries, as selected by the
Office of the Chairman, including Messrs. Judd, Kettell and Adams.
The agreements provide for benefits payable in monthly installments over
ten years upon retirement at age 65 or upon the death of the employee (paid to
his beneficiary). The agreements contain vesting schedules that provide for full
vesting by ages ranging from 58 to 63, depending upon the age of the employee at
time the agreement was executed. The vesting schedules provide that one-third of
the benefits vest during the first half of the vesting period and two-thirds
vest during the second half.
The annual installments payable upon retirement at age 65 or death to
Messrs. Judd, Kettell and Adams are $300,000, $375,000, and $60,000,
respectively. As of December 31, 1994, Messrs. Judd, Kettell, and Adams had
accumulated vested benefits of $809,200, $1,091,700, and $73,300, respectively,
pursuant to the agreements. During 1994, the following amounts under the
agreements were vested for the accounts of Messrs. Judd, Kettell, and Adams,
respectively: $142,800, $230,900 and $20,000. In addition, Mr. Judd has $541,670
in fully vested benefits remaining from a separate deferred compensation
agreement that provides for an aggregate of 120 monthly installments of $8,333
each to be paid to him at his election.
The Company carries life insurance policies on the lives of these employees
in amounts estimated to be sufficient to cover its obligations under the
agreements. If assumptions as to mortality experiences, future policy dividends
and other factors are realized, the Company will recover an amount equal to all
retirement payments under the agreements, plus the premiums on the insurance
contracts and the interest that could have been earned on the use of the premium
payments.
COMPENSATION OF DIRECTORS
An annual retainer of $15,000, paid monthly, and a fee of $2,000 for each
Board of Directors meeting attended is paid to directors who are not employees
of the Company. In addition, the Chairman of the Audit Committee receives a fee
of $1,000 per Audit Committee meeting attended and each of the other members of
the Audit Committee receives a fee of $750 for each Audit Committee meeting
attended.
9
<PAGE> 13
STOCK OPTIONS
Information concerning individual grants of stock options made to the two
Chief Executive Officers and the three most highly compensated executive
officers of the Company during the year ended December 31, 1994 is set forth
below:
OPTION GRANTS TABLE
OPTION GRANTS FOR YEAR ENDED DECEMBER 31, 1994
<TABLE>
<CAPTION>
INDIVIDUAL GRANTS
------------------------------------------------- POTENTIAL REALIZABLE
% OF VALUE AT ASSUMED ANNUAL
TOTAL OPTIONS RATES OF STOCK PRICE
GRANTED TO APPRECIATION FOR OPTION
OPTIONS EMPLOYEES EXERCISE OR TERM
GRANTED IN FISCAL BASE PRICE EXPIRATION -------------------------
NAME (#) YEAR ($/SH) DATE 5%($) 10%($)
- -------------------------- ------ ------------- ----------- ---------- -------- ----------
<S> <C> <C> <C> <C> <C> <C>
Herbert M. Sandler........ 35,000 9.2% $38.75 06/02/2004 $853,000 $2,162,000
Marion O. Sandler......... 35,000 9.2 38.75 06/02/2004 853,000 2,162,000
James T. Judd............. 17,500 4.6 38.75 06/02/2004 426,500 1,081,000
Russell W. Kettell........ 17,500 4.6 38.75 06/02/2004 426,500 1,081,000
Dirk S. Adams............. 2,800 .7 34.50 12/09/2004 61,000 154,000
200 .1 34.50 01/09/2005 4,000 11,000
</TABLE>
Information concerning exercises of stock options by the two Chief
Executive Officers and the three most highly compensated executive officers of
the Company during the year ended December 31, 1994 and certain information
concerning unexercised stock options is set forth below:
OPTION EXERCISES AND YEAR END VALUE TABLE
AGGREGATED OPTION EXERCISES FOR THE YEAR ENDED DECEMBER 31, 1994 AND
DECEMBER 31, 1994 YEAR END OPTION VALUES
<TABLE>
<CAPTION>
VALUE OF UNEXERCISED
NUMBER OF UNEXERCISED IN-THE-MONEY
OPTIONS AT OPTIONS AT
DECEMBER 31, 1994(#) DECEMBER 31, 1994($)(B)
SHARES ACQUIRED VALUE --------------------------- ---------------------------
NAME ON EXERCISE(#) REALIZED($)(A) EXERCISABLE UNEXERCISABLE EXERCISABLE UNEXERCISABLE
- -------------------- --------------- --------------- ----------- ------------- ----------- -------------
<S> <C> <C> <C> <C> <C> <C>
Herbert M.
Sandler........... 9,300 $ 226,687 608,700 80,000 $12,575,650 $ 2,500
Marion O. Sandler... 51,300 1,250,438 562,410 80,000 11,452,425 2,500
James T. Judd....... 41,000 1,262,850 52,000 64,000 1,067,375 304,125
Russell W.
Kettell........... 1,800 55,200 192,000 64,000 4,292,313 304,125
Dirk S. Adams....... 8,000 229,250 16,700 18,000 258,112 35,063
</TABLE>
- ---------------
(A) Market value of underlying securities at exercise date less the option
price.
(B) Market value of unexercised "in-the-money" options at year end less the
option price of the "in-the-money" options.
10
<PAGE> 14
COMMON STOCK PERFORMANCE GRAPH
The graph below compares the yearly change in the Company's cumulative
total stockholder return on its Common Stock for the five years ended December
31, 1994 with the cumulative total return, assuming reinvestment of dividends,
of each of the Standard & Poor's 500 Stock Index and an index of peer issuers.
Cumulative total stockholder return is measured by dividing (i) the sum of (A)
the cumulative amount of dividends for the measurement period, assuming dividend
reinvestment and (B) the difference between the Company's share price at the
beginning and the end of the measurement period by (ii) the share price at the
beginning of the measurement period. The issuers included in the peer index are
all regional bank holding companies that have assets in excess of $20 billion
and a primary bank operating subsidiary rated as high or higher than the
Company's principal subsidiary, World Savings and Loan Association, (A1 or
better by Moody's and A+ or better by Standard & Poor's): namely, BANC ONE
Corp.; BankAmerica Corp.; Boatmen's Bancshares; Corestates Financial Corp.;
First Bank System; First Chicago Corp.; First Union Corporation; Mellon
BankCorp; National City Corp.; NationsBank Corp.; NBD Bancorp Inc.; Norwest
Corp.; PNC Financial Corp.; Republic New York Corp.; SunTrust Banks, Inc.; U.S.
Bancorp; and Wachovia Corp. Mellon BankCorp. which did not meet the peer index
criteria in the prior year, has been added to the peer group in 1994 because of
a change in its credit rating. The returns of each component issuer of such
group have been weighted according to the stock market capitalization of the
respective issuer.
TOTAL SHAREHOLDER RETURN PERFORMANCE GRAPH
<TABLE>
<CAPTION>
GOLDEN WEST
MEASUREMENT PERIOD S&P 500 IN- FINANCIAL
(FISCAL YEAR COVERED) DEX CORP PEER GROUP
<S> <C> <C> <C>
DEC. 89 100 100 100
DEC. 90 96.90 92.18 85.14
DEC. 91 126.42 164.19 142.49
DEC. 92 136.05 164.17 179.37
DEC. 93 149.76 148.55 183.12
DEC. 94 151.74 135.33 172.24
</TABLE>
Assumes $100 invested on December 31, 1989 in the stock of Golden West
Financial Corporation, S&P 500 Index and Peer Group (weighted by market
capitalization). Total return assumes reinvestment of dividends.
11
<PAGE> 15
APPROVAL OF AUDITORS
The Board of Directors has appointed Deloitte & Touche LLP to serve as the
Company's independent auditors for the year ending December 31, 1995, subject to
stockholder approval. If the stockholders do not vote in favor of the
appointment of Deloitte & Touche LLP, the Board of Directors will consider the
selection of other auditors.
Representatives of Deloitte & Touche LLP will be present at the Annual
Meeting of Stockholders and will be available to respond to appropriate
questions. They will be given the opportunity to make a statement, if they
desire to do so.
Deloitte & Touche LLP has served as the Company's independent auditors
since 1963 and was selected by the Board of Directors to serve in 1994, which
selection was ratified and approved by the stockholders of the Company on April
28, 1994. In order to be adopted, the proposal to approve the appointment of
Deloitte & Touche LLP as auditors for the Company must be approved by the
holders of a majority of the outstanding shares of Common Stock present or
represented by proxy and entitled to vote at the meeting. The Board of Directors
recommends a vote FOR the appointment of Deloitte & Touche LLP to serve as the
Company's independent auditors for the year ending December 31, 1995.
STOCKHOLDERS' PROPOSALS FOR NEXT ANNUAL MEETING
Stockholders' proposals intended to be presented at the 1996 Annual Meeting
of Stockholders of the Company must be received by the Company not later than
November 9, 1995, for inclusion in the Company's Proxy Statement and form of
proxy relating to that meeting. Proposals should be addressed to the Company at
1901 Harrison Street, Oakland, California, 94612, Attention: Corporate
Secretary.
OTHER MATTERS
The management knows of no business other than that mentioned above to be
transacted at the Annual Meeting, but if other matters do properly come before
the meeting it is the intention of the persons named in the enclosed proxy to
vote thereon in accordance with their judgment, and discretionary authority to
do so is included in the proxy.
GOLDEN WEST FINANCIAL CORPORATION
Oakland, California
March 10, 1995
12
<PAGE> 16
PROXY SOLICITED BY BOARD OF DIRECTORS
The undersigned hereby appoints BERNARD
A. OSHER, HERBERT M. SANDLER, and
J. L. HELVEY, or any of them, each with
GOLDEN PROXY power of substitution, as proxies of the
undersigned to attend the Annual Meeting
WEST of Stockholders of Golden West Financial
Corporation (the "Company"), to be held
FINANCIAL on the fourth floor of the Company's
headquarters located at 1901 Harrison
CORPORATION Street, Oakland, California, on May 2, 1995
at 11:00 a.m., and any adjournment thereof,
and to vote the number of shares of Common
Stock, $.10 par value, of the Company,
which the undersigned would be entitled to
vote if personally present on the following:
(1) ELECTION OF DIRECTORS
/ /FOR all nominees listed below
(except as marked to the contrary below)
/ /WITHHOLD AUTHORITY to vote for all nominees
listed below
Patricia A. King, Paul Sack, Marion O. Sandler
(INSTRUCTION: TO WITHHOLD AUTHORITY TO VOTE FOR ANY INDIVIDUAL, WRITE THAT
NOMINEE'S NAME IN THE SPACE PROVIDED BELOW)
- --------------------------------------------------------------------------------
(2) RATIFICATION OF THE APPOINTMENT OF DELOITTE & TOUCHE LLP, independent public
accountants, to examine the accounts of the Company for the current fiscal
year.
/ / FOR / / AGAINST / / ABSTAIN
(3) In their discretion, upon all other matters as may properly be brought
before the meeting or any adjournment thereof.
(Continued and to be signed on reverse side)
(Continued from other side)
THIS PROXY WILL BE VOTED IN ACCORDANCE WITH INSTRUCTIONS GIVEN. IN THE
ABSENCE OF SUCH INSTRUCTIONS, THIS PROXY WILL BE VOTED FOR THE ELECTION OF
DIRECTORS NOMINATED BY MANAGEMENT AND FOR PROPOSAL 2.
Please date and sign below exactly as your name or names appear hereon. If
more than one name appears, all should sign. Joint owners should each sign
personally. Corporate proxies should be signed in full corporate name by an
authorized officer and attested. Persons signing in a fiduciary capacity should
indicate their full names in such capacity.
----------------------------
(Signature of Stockholder)
----------------------------
(Signature of Stockholder)
Dated: , 1995
----------------
STOCKHOLDERS ARE URGED TO COMPLETE, SIGN AND RETURN THIS PROXY PROMPTLY IN THE
ENCLOSED ENVELOPE.
