<PAGE>
Schedule 14A Information
Proxy Statement Pursuant to Section 14(a)
of the Securities Exchange Act of 1934 (Amendment No. )
Filed by the Registrant [X]
Filed by a Party other than the Registrant [ ]
Check the appropriate box:
[ ] Preliminary Proxy Statement [ ] Confidential, for Use of the Commission
Only (as permitted by Rule 14a-6(e)(2))
[X] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to Section 240.14a-11(c) or Section 240.14a-12
H. F. AHMANSON & COMPANY
- --------------------------------------------------------------------------------
(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)(4) 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:
-------------------------------------------------------------------------
<PAGE>
March 12, 1997
[ ] 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:
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Notes:
<PAGE>
[LOGO OF H.F. AHMANSON & COMPANY]
4900 RIVERGRADE ROAD
IRWINDALE, CALIFORNIA 91706
----------------
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD ON APRIL 21, 1997
----------------
The Annual Meeting of Stockholders of H. F. Ahmanson & Company ("Ahmanson")
will be held at the Company's offices, 4900 Rivergrade Road, Irwindale,
California, on April 21, 1997, at 11:30 a.m., for the following purposes:
1. To elect thirteen directors to serve until the next Annual Meeting of
Stockholders and until their successors are elected and qualified.
2. If properly presented to the meeting, to consider and vote on a
stockholders' precatory resolution relating to lending to disadvantaged
groups.
3. To consider and act upon such other business as may properly come
before the meeting or any adjournment thereof.
The Board of Directors has fixed the close of business on March 17, 1997, as
the record date for determining stockholders of Ahmanson entitled to notice of
and to vote at the meeting.
STOCKHOLDERS ARE CORDIALLY INVITED TO ATTEND THE MEETING. TO AID IN
MAINTAINING SECURITY AT THE CORPORATE HEADQUARTERS, THE ENCLOSED ADMISSION
TICKET TO THE STOCKHOLDERS MEETING WILL BE REQUIRED. TO INSURE YOUR
REPRESENTATION AT THE MEETING, PLEASE COMPLETE AND PROMPTLY MAIL YOUR PROXY IN
THE RETURN POSTAGE PREPAID ENVELOPE PROVIDED. THIS WILL NOT PREVENT YOU FROM
VOTING IN PERSON SHOULD YOU SO DESIRE.
By Order of the Board of Directors,
Madeleine A. Kleiner
Secretary
<PAGE>
[LOGO OF H.F. AHMANSON & COMPANY]
4900 RIVERGRADE ROAD
IRWINDALE, CALIFORNIA 91706
March 21, 1997
PROXY STATEMENT
ANNUAL MEETING OF STOCKHOLDERS
APRIL 21, 1997
SOLICITATION OF PROXIES
This Proxy Statement is furnished in connection with the solicitation of
proxies by the Board of Directors of H. F. Ahmanson & Company, a Delaware
corporation ("Ahmanson"), for use at the Annual Meeting of Stockholders to be
held April 21, 1997, and all adjournments and postponements thereof. This
Proxy Statement and the accompanying form of proxy were first mailed to
stockholders on or about March 21, 1997.
The cost of preparing, assembling and mailing the Notice of Annual Meeting
of Stockholders, Proxy Statement and form of proxy and the solicitation of
proxies will be paid by Ahmanson. Proxies may be solicited by personnel of
Ahmanson and others who will not receive any additional compensation for such
solicitation. Proxies may be solicited in person or by telephone, telegraph or
facsimile. Ahmanson will pay brokers or other persons holding stock in their
names or the names of their nominees for the expenses of forwarding soliciting
material to their principals. In addition, Ahmanson has engaged MacKenzie
Partners, Inc., a proxy solicitation firm, to assist in soliciting proxies for
a fee not to exceed $10,000 plus reimbursement of reasonable out-of-pocket
expenses.
VOTING
The close of business on March 17, 1997 has been fixed as the record date
for the determination of stockholders entitled to notice of and to vote at the
meeting. On that date there were outstanding 100,594,581 shares of Ahmanson's
Common Stock, $.01 par value (the "Ahmanson Common Stock"), 7,800,000
Depositary Shares, each representing a one-tenth interest in a share of
Ahmanson's 8.40% Preferred Stock, Series C (which shares are not entitled to
vote at the meeting), and 5,750,000 Depositary Shares, each representing a
one-tenth interest in a share of Ahmanson's 6% Cumulative Convertible
Preferred Stock, Series D (which shares are not entitled to vote at the
meeting). A majority of the shares entitled to vote, present in person or
represented by proxy, will constitute a quorum at the meeting. Each share of
Ahmanson Common Stock is entitled to one vote on any matter that may be
presented for consideration and action by the stockholders at the meeting. In
all matters other than the election of directors, the affirmative vote of the
majority of shares of Ahmanson Common Stock present in person or represented
by proxy at the meeting and entitled to vote on the subject matter will be the
act of the stockholders. Directors will be elected by a plurality of the votes
of the shares of Ahmanson Common Stock present in person or represented by
proxy and entitled to vote on the election of directors. Abstentions will be
treated as the equivalent of a negative vote for the purpose of determining
whether a proposal has been adopted and will have no effect for the purpose of
determining whether a director has been elected. As to the stockholder
proposal presented in this proxy statement, New York Stock Exchange rules
generally require that when shares are registered in street or nominee name
that its member brokers receive specific instructions from the beneficial
owners in order to vote on such proposal. If a broker indicates on the proxy
that such broker does not have discretionary authority as to certain shares to
vote on a particular matter, those shares will be treated as present for
purposes of determining the existence of a quorum but will not be considered
as present and entitled to vote with respect to that matter.
1
<PAGE>
Proxies will be voted (i) for management's nominees for election as
directors and (ii) against the stockholders' proposed precatory resolution,
unless the stockholder otherwise directs in his or her proxy. Where the
stockholder has appropriately directed how the proxy is to be voted, it will
be voted according to his or her direction. Proxies will be voted on any other
business that may properly come before the meeting as the persons named
therein or their substitutes determine in their discretion. At the time of the
preparation of this Proxy Statement, the Board of Directors of Ahmanson was
not aware of any other matters to be presented at the meeting.
Any stockholder has the power to revoke his or her proxy at any time before
it is voted at the meeting by submitting written notice of revocation to the
Secretary of Ahmanson or by filing a duly executed proxy bearing a later date.
A proxy will not be voted if the stockholder who executed it is present at the
meeting and elects to vote the shares represented thereby in person.
Attendance at the meeting will not by itself revoke a previously granted
proxy.
2
<PAGE>
ELECTION OF DIRECTORS
The directors of Ahmanson are elected annually. The term of office of all
present directors expires on the date of the Annual Meeting of Stockholders of
Ahmanson upon election and qualification of their successors. At the meeting
thirteen directors are to be elected to serve for the ensuing year and until
their successors are elected and qualified. The nominees recommended by the
Nominating Committee of the Board of Directors for election as directors (all
of whom are presently directors) are set forth below along with certain
information regarding these nominees. Should any nominee become unavailable to
serve as a director or should any vacancy occur before the election (which
events are not anticipated), the proxies may be voted for a substitute nominee
selected by the Board of Directors or the authorized number of directors may
be reduced. If for any reason the authorized number of directors is reduced,
the proxies will be voted, in the absence of instructions to the contrary, for
the election of the remaining nominees named in this Proxy Statement. To the
best of Ahmanson's knowledge, all nominees are and will be available to serve.
<TABLE>
<CAPTION>
AGE (AS OF DIRECTOR
NAME MARCH 21, 1997) PRINCIPAL OCCUPATION AND OTHER DIRECTORSHIPS SINCE
---- --------------- -------------------------------------------- --------
<S> <C> <C> <C>
Byron Allumbaugh 65 Retired Chairman of the Board of Ralphs Grocery 1987
Company, a Los Angeles-based supermarket company;
director of El Paso Energy Company, Ultramar Diamond
Shamrock, Inc. and CKE Restaurants, Inc.
Harold A. Black 51 James F. Smith Professor of Financial Institutions 1995
at the College of Business Administration at the
University of Tennessee, Knoxville
Richard M. Bressler 66 Retired Chairman of the Board of Plum Creek 1987
Management Company, a manufacturer of lumber and
wood products, and retired Chairman of the Board of
El Paso Natural Gas Company (now known as El Paso
Energy Company), a natural resources company;
director of General Mills, Inc. and Rockwell
International Corporation
David R. Carpenter 57 Chairman and Chief Executive Officer, Paradigm 1995
Partners International, Chairman of UniHealth, and
retired as Chairman and Chief Executive Officer of
Transamerica Occidental Life Insurance Company and
Executive Vice President of Transamerica
Corporation; director of PacifiCare Health Systems
Phillip D. Matthews 58 Chairman of the Executive Committee of the Board of 1995
Wolverine World Wide, Inc., a NYSE footwear company;
director of Bell Sports, Inc.
Richard L. Nolan 56 M.B.A. Class of 1942 Professor of Business 1995
Administration at the Graduate School of Business
Administration at Harvard University; director of
Xcellenet Inc.
Delia M. Reyes 55 President and Chief Executive Officer of Reyes 1992
Consulting Group, a market research and consulting
firm
Charles R. Rinehart* 50 Chairman of the Board and Chief Executive Officer of 1990
Ahmanson; Chairman of the Board and Chief Executive
Officer of Home Savings of America, FSB; director of
Kaufman & Broad Home Corporation
Frank M. Sanchez 53 Owner and operator of eight McDonald's franchises 1995
Elizabeth A. Sanders 51 Business consultant; director of Flagstar Companies 1990
Inc., Wal-Mart Stores, Inc., Wellpoint Health
Networks, Inc. and Wolverine World Wide, Inc.
Arthur W. Schmutz 75 Retired partner of Gibson, Dunn & Crutcher, a law 1993
firm; director of Ducommun Incorporated
William D. Schulte 64 Retired Vice Chairman of KPMG Peat Marwick LLP, a 1991
firm of independent certified public accountants;
director of Santa Anita Operating Company, Santa
Anita Realty Enterprises, Inc. and Vastar Resources,
Inc.
Bruce G. Willison* 48 President and Chief Operating Officer of Ahmanson; 1996
President and Chief Operating Officer of Home
Savings of America, FSB; director of Portland
General Corporation
</TABLE>
- --------
* Executive officers.
3
<PAGE>
Mr. Rinehart has served as an officer of Ahmanson and/or one or more of its
subsidiaries for more than five years. Mr. Willison joined Ahmanson in April
and became President and Chief Operating Officer in May 1996. From 1979 until
joining Ahmanson, Mr. Willison was with First Interstate Bancorp and/or one or
more of its subsidiaries. For more than 5 years prior to joining Ahmanson, he
was Chairman, President and Chief Executive Officer of First Interstate Bank
of California and, since January 1995, he was also Vice Chairman of First
Interstate Bancorp. Messrs. Matthews, Rinehart, Schmutz, Schulte and Willison
and Ms. Sanders also serve as directors of Home Savings of America, FSB ("Home
Savings").
Ahmanson's mandatory retirement policy. The policy provides that the Board
of Directors will not elect or nominate for election by the stockholders as a
director any person who is or will be prior to the scheduled date of the
election 70 or more years of age. Arthur W. Schmutz, age 75 and a director
since 1993, has been granted a special exemption to the mandatory retirement
policy until the 1998 Annual Shareholders meeting.
Ahmanson's executive officers not listed above are Kevin M. Twomey, age 50,
Senior Executive Vice President since March 1995, Chief Financial Officer
since July 1993, and Executive Vice President from July 1993 to March 1995, of
Ahmanson and Home Savings; Madeleine A. Kleiner, age 45, Chief Administrative
Officer and Senior Executive Vice President of Ahmanson and Home Savings since
February 1997, General Counsel and Secretary of Ahmanson and General Counsel
of Home Savings since May 1995 and Executive Vice President of Ahmanson and
Home from May 1995 to February 1997; Anne-Drue M. Anderson, age 35, Executive
Vice President since March 1995, Treasurer since September 1993, and First
Vice President from September 1993 to March 1995, of Ahmanson and Home
Savings; E. Nancy Markle, age 55, Executive Vice President of Ahmanson and
Home Savings since July 1995, and First Vice President from July 1994 to July
1995, of Home Savings; and George Miranda, age 49, First Vice President and
Principal Accounting Officer of Ahmanson and Home Savings. Mr. Twomey is Vice
Chairman of the Board of Directors of Home Savings. Prior to joining Ahmanson
in June 1993, Mr. Twomey worked in corporate finance at MacAndrews and Forbes
Holdings since February 1993, and was Executive Vice President, Finance,
Administration and Chief Financial Officer of First Gibraltar Bank from July
1989 to February 1993. From April 1993 until joining Ahmanson, Ms. Anderson
was Bank and Thrift Strategist at First Boston Corporation. From September
1989 to February 1993 she was Senior Vice President and Treasurer at First
Gibraltar Bank. From 1977 until joining Ahmanson in May 1995, Ms. Kleiner was
with the law firm of Gibson, Dunn and Crutcher, where she was a partner since
1983. Prior to joining Home Savings in July 1994, Ms. Markle served as
president of Information Technology Consultants since 1988. Mr. Miranda has
served as an officer of Ahmanson and/or one of its subsidiaries for more than
five years.
The Board of Directors has an Executive Committee, an Audit Committee, a
Compensation Committee and a Nominating Committee. The Executive Committee is
composed of Byron Allumbaugh, Richard M. Bressler, Charles R. Rinehart
(Chairperson), Arthur W. Schmutz and Bruce G. Willison and held no meetings
during 1996. The Audit Committee is composed of Harold A. Black, David R.
Carpenter, Richard L. Nolan, Frank M. Sanchez, Arthur W. Schmutz and William
D. Schulte (Chairperson). The Compensation Committee is composed of Byron
Allumbaugh, Richard M. Bressler (Chairperson), Phillip D. Matthews, Delia M.
Reyes and Elizabeth A. Sanders. Lodwrick M. Cook, who retired as a director in
March 1996, preceded Phillip D. Matthews on the Compensation Committee. The
Nominating Committee is composed of Byron Allumbaugh (Chairperson), Richard M.
Bressler, Richard L. Nolan, Delia M. Reyes, Charles R. Rinehart, Frank M.
Sanchez and Bruce G. Willison.
The Audit Committee held five meetings in 1996. The function of the Audit
Committee is to provide oversight to the audit plan and the internal audit
activities of Ahmanson, to review and evaluate the audit plan and the scope of
audit procedures employed by Ahmanson's independent auditors, to review and
evaluate audit reports rendered by both Ahmanson's independent auditors and
its internal staff and to approve the audit fee charged by the independent
auditors. The Audit Committee reports to the Board of Directors with respect
to such matters and recommends the selection of independent auditors.
4
<PAGE>
The Compensation Committee held four meetings in 1996. The primary function
of the Compensation Committee is to determine the compensation of officers of
Ahmanson and the executive officers of its subsidiaries, to administer and
grant awards under Ahmanson's 1993 Stock Incentive Plan and to administer
Ahmanson's 1984 Stock Incentive Plan.
The Nominating Committee held one meeting in 1996. The function of the
Nominating Committee is to seek, evaluate and recommend to the Board of
Directors qualified individuals for election to the Board of Directors by the
stockholders, or by the Board of Directors to fill vacancies thereon whenever
vacancies occur or whenever the Nominating Committee or the Board of Directors
considers it advisable to add or change directors. The Nominating Committee
also advises the Board of Directors on matters pertaining to the size and
composition of the Board of Directors. The Nominating Committee will consider
nominees for director whose names are timely submitted by holders of Ahmanson
Common Stock in writing addressed to the Chairperson of the Nominating
Committee accompanied by such information regarding the nominee as would be
required under the rules of the Securities and Exchange Commission were the
stockholder soliciting proxies with regard to the election of such nominee.
In 1996 the Board of Directors held six meetings. All directors attended at
least 75 percent of the meetings held during 1996 by the Board of Directors
and the committees on which they served except Richard M. Bressler who
attended eight of eleven meetings.
Arthur W. Schmutz, a director of Ahmanson and a member of its Executive and
Audit Committees, is a retired partner of the law firm of Gibson, Dunn &
Crutcher, which has represented Ahmanson and its subsidiaries for more than
the past year and continues to do so.
PRINCIPAL HOLDERS OF AHMANSON COMMON STOCK
The following table sets forth as of December 31, 1996 (i) the name and
address of the beneficial owners of more than five percent of the outstanding
shares of Ahmanson Common Stock, (ii) the total number of shares of Ahmanson
Common Stock beneficially owned and (iii) the percent of the outstanding
shares of Ahmanson Common Stock so owned.
<TABLE>
<CAPTION>
AMOUNT AND NATURE
NAME AND ADDRESS OF BENEFICIAL PERCENT
OF BENEFICIAL OWNER OWNERSHIP OF CLASS
------------------- ----------------- --------
<S> <C> <C>
Merrill Lynch & Co., Inc....................... 9,359,361(1) 9.16%
250 Vesey St.
World Financial Center
North Tower
New York, New York 01281-1334
Putnam Investments, Inc........................ 9,089,224(2) 8.9 %
One Post Office Square
Boston, MA 02109
The Capital Group Companies, Inc............... 8,445,120(3) 8.27%
333 South Hope Street
Los Angeles, CA 90071
Wellington Management Company LLP.............. 6,013,953(4) 5.89%
75 State Street
Boston, MA 02109
</TABLE>
- --------
(1) Merrill Lynch Asset Management, L.P. ("MLAM"), a registered investment
adviser, has shared voting power of 7,374,885 shares and shared
dispositive power over 7,175,135 shares. Princeton Services, Inc. ("PSI")
is beneficial owner of 9,175,135 shares because it serves as the general
partner of MLAM d/b/a Merrill Lynch Asset Management and Fund Asset
Management L.P. d/b/a/ Fund Asset Management. PSI
5
<PAGE>
disclaims beneficial ownership of all shares. Merrill Lynch Group, Inc.
("MLGI") is beneficial owner of 9,334,435 shares because it is the parent
company of PSI and one or more Merrill Lynch trust companies which may have
discretionary accounts. MLGI disclaims beneficial ownership of all shares.
Merrill Lynch & Co. ("ML&C") is beneficial owner of 9,359,361 shares
because it is the parent company of MLGI and Merrill Lynch Pierce, Fenner &
Smith ("MLPFS"), a broker dealer which has proprietary trading accounts
possibly holding shares of which MLPFS has discretionary power or held by
unit investments for which MLPFS is the sponsor. ML&C disclaims beneficial
ownership of all shares.
(2) Putnam Investments Inc. is deemed to be the beneficial owner of these
shares by virtue of the direct or indirect investment and/or voting
discretion its subsidiaries possess pursuant to the provisions of
investment advisory agreements with various clients, none of whom is known
by Ahmanson to own beneficially more than five percent of the outstanding
shares of Ahmanson Common Stock. Putnam Investments Inc. has two
subsidiaries, Putnam Investment Management Inc. which holds shared
dispositive power in 8,989,154 shares and the Putnam Advisory Company Inc.
which holds shared voting power of 60,160 shares and the shared
dispositive power of 100,070 shares. Putnam Investments, Inc. is a wholly
owned subsidiary of Marsh & McLennan Companies, Inc. which disclaims
beneficial ownership of the shares.
(3) The Capital Group Companies, Inc. is deemed to be the beneficial owner of
these shares by virtue of the direct or indirect investment and/or voting
discretion its subsidiaries possess pursuant to the provisions of
investment advisory agreements with various clients, none of whom is known
by Ahmanson to own beneficially more than 5% of the outstanding shares of
Ahmanson Common Stock. The number of shares reported includes 2,053,050
shares resulting from the assumed conversion of 999,200 shares of the 6%
Series D Preferred Stock. Through its subsidiaries, The Capital Group
Companies, Inc. has sole voting power with respect to 2,944,070 of these
shares. Beneficial ownership with respect to all these shares has been
disclaimed by the Capital Group Companies, Inc.
(4) Wellington Management Company LLP is deemed to be the beneficial owner of
these shares by virtue of the direct or indirect investment and/or voting
discretion it possesses pursuant to the provisions of investment advisory
agreements with various clients of Wellington Management Company or its
wholly owned subsidiary, Wellington Trust Company, N.A., none of whom is
known to Ahmanson to own beneficially more than five percent of the
outstanding shares of Ahmanson Common Stock. Wellington Management Company
LLP has shared voting power with respect to 15,411 shares and shared power
to dispose or direct the disposition of all shares.
All information with respect to beneficial ownership of the shares referred
to above and under "Security Ownership of Management" below is based upon
filings made by the respective beneficial owners with the Securities and
Exchange Commission or information provided to Ahmanson by such beneficial
owners.
6
<PAGE>
SECURITY OWNERSHIP OF MANAGEMENT
The following information sets forth the number of shares of Ahmanson Common
Stock beneficially owned as of February 28, 1997 by each of the present
directors and nominees of the Nominating Committee of the Board of Directors,
each of the individuals included in the "Summary Compensation Table" below and
all directors, nominees and executive officers as a group. No director or
executive officer owns Depositary Shares representing interests in Ahmanson's
Preferred Stock.
<TABLE>
<CAPTION>
NAME OR NUMBER OF NUMBER OF VOTING PERCENT OF
PERSONS IN GROUP SHARES OWNED OPTIONS(1) POWER ONLY TOTAL CLASS(2)
----------------- ------------ ---------- ---------- --------- ----------
<S> <C> <C> <C> <C> <C>
Byron Allumbaugh........ 2,500 17,000 -- 19,500 --
Anne-Drue M. Anderson... 5,589 112,470 -- 118,059 --
Harold A. Black......... -- 2,000 -- 2,000 --
Richard M. Bressler..... 20,000 17,000 -- 37,000 --
David R. Carpenter...... 290 3,816 -- 4,106 --
Madeleine A. Kleiner.... 4,468 61,946 -- 66,414 --
Phillip D. Matthews..... 6,000 3,816 -- 9,816 --
Richard L. Nolan........ -- 2,000 -- 2,000 --
Delia M. Reyes.......... -- 9,000 -- 9,000 --
Charles R. Rinehart..... 130,848 503,347 837,454(3) 1,471,649 1.30%
Frank M. Sanchez........ -- 2,000 -- 2,000 --
Elizabeth A. Sanders.... 3,000 12,000 -- 15,000 --
Arthur W. Schmutz....... 5,000 7,000 -- 12,000 --
William D. Schulte...... 2,500 11,000 -- 13,500 --
Kevin M. Twomey......... 12,090 213,058 -- 225,148 --
Bruce G. Willison....... 35,000 100,000 -- 135,000 --
All directors and
executive officers
as a group (18
persons)............... 242,579 1,184,267 837,454 2,264,300 2.00%
</TABLE>
- --------
(1) Represents shares subject to options which are presently exercisable or
exercisable within 60 days after February 28, 1997 for an average price of
$20.90 for the total number.
(2) Percentage information is omitted for those individuals whose beneficially
owned shares represent less than one percent of the outstanding shares of
Ahmanson Common Stock.
(3) Mr. Rinehart has disclaimed beneficial ownership of such shares because
his interest in such shares is limited to an irrevocable proxy from Wells
Fargo Bank, as trustee. The trust instruments covering such shares provide
that the trustee shall grant to the Chairman of the Board of Ahmanson upon
request a proxy to vote such shares, and the trustee has granted an
irrevocable proxy for a term of seven years, expiring in January 2001, to
Mr. Rinehart as Chairman of the Board and his successors as Chairman of
the Board.
7
<PAGE>
EXECUTIVE COMPENSATION
The following table sets forth the compensation for services rendered in all
capacities to Ahmanson and its subsidiaries earned during the years indicated
by each of Ahmanson's Chief Executive Officer and the four most highly
compensated executive officers of Ahmanson (other than the Chief Executive
Officer) who were employed by Ahmanson as of December 31, 1996 (collectively
referred to as the "named executive officers").
SUMMARY COMPENSATION TABLE(1)
<TABLE>
<CAPTION>
ANNUAL COMPENSATION LONG-TERM COMPENSATION(2)
------------------------------ ---------------------------
AWARDS PAYOUTS
------------------ --------
OTHER ANNUAL RESTRICTED LTIP ALL OTHER
COMPENSATION STOCK OPTIONS PAYOUTS COMPENSATION
NAME AND TITLE YEAR SALARY BONUS(3) (4) AWARDS (5) (6)(#) (7) (8)
-------------- ---- -------- -------- ------------ ---------- ------- -------- ------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Charles R. Rinehart..... 1996 $760,008 $891,763 -- $ -- 136,759 $778,058 $214,122
Chairman of the Board 1995 760,008 851,200 -- 370,427 208,613 795,150 178,647
and Chief Executive 1994 715,008 577,438 -- -- 132,365 477,755 236,217
Officer
Bruce G. Willison(9).... 1996 322,602 308,007 -- 584,375 159,469 273,000 --
President and Chief 1995 -- -- -- -- -- -- --
Operating Officer 1994 -- -- -- -- -- -- --
Kevin M. Twomey......... 1996 415,008 438,258 -- -- 71,570 424,864 98,575
Senior Executive Vice 1995 381,254 327,600 -- 213,842 90,234 340,031 74,566
President and Chief 1994 333,759 201,944 -- -- 51,754 184,848 59,385
Financial Officer
Madeleine A.
Kleiner(10)............ 1996 325,008 321,765 80,026 -- 55,669 324,409 --
Senior Executive Vice 1995 210,517 225,225 -- 108,908 55,175 113,344 --
President, General 1994 -- -- -- -- -- -- --
Counsel and Secretary
Anne-Drue M.
Anderson(11)........... 1996 300,000 297,007 -- -- 51,278 322,481 22,302
Executive Vice 1995 273,758 246,960 -- 131,357 63,052 244,125 15,078
President and 1994 -- -- -- -- -- -- --
Treasurer
</TABLE>
- --------
(1) Includes bonuses and long-term compensation payouts earned in the
performance measurement period ending on December 31 of such year
although the payout was not authorized by the Compensation Committee
until the following year.
(2) Stockholdings of Messrs. Rinehart, Willison and Twomey and Mmes. Kleiner
and Anderson of 15,197, 25,000, 8,773, 4,468 and 5,389 shares,
respectively, were subject to vesting restrictions, and had a net market
value at December 31, 1996 of $493,903, $812,500, $285,123, $145,210 and
$175,143, respectively, not accounting for the effect of the vesting
restrictions. Except for Mr. Willison, who received a restricted stock
award upon joining Ahmanson, all such stock represents shares issued as
payouts under Ahmanson's 1993 Stock Incentive Plan and was reflected in
the table under the heading "Restricted Stock Awards" for the year
granted.
(3) All of the awards granted under the Executive Short-Term Incentive Plan
and Executive Long-Term Incentive Plan to Messrs. Rinehart and Willison
were tax qualified. Portions of the remaining awards were not tax
qualified but all were tax deductible for Ahmanson.
(4) Excludes compensation in the form of other personal benefits, which, for
each of the named executive officers, other than Ms. Kleiner in 1996, did
not exceed the lesser of $50,000 or 10 percent of the total of annual
salary and bonus reported for each year. Other Annual Compensation for
Ms. Kleiner in 1996 includes reimbursement of relocation expenses of
$70,518.
(5) The 33,827 restricted stock award shares granted to Messrs. Rinehart and
Twomey and Mmes. Kleiner and Anderson for 1995 were granted in February
1996. The 25,000 restricted stock award shares granted to Mr. Willison
for 1996 were granted in April 1996. Restricted stock award shares vest
in equal annual
8
<PAGE>
one-third installments beginning three years after the grant. Dividends
are paid on such restricted stock award shares prior to the lapse of
restrictions to the same extent that dividends are paid on all other
shares of Ahmanson's Common Stock.
(6) In 1994 Ahmanson adopted an amendment of its Executive Long-Term
Incentive Plan which, among other things, changed the timing of grants of
options from the end to the beginning of the performance measurement
period. Therefore, for 1994 and 1995 includes option grants made as
awards under the Executive Long-Term Incentive Plan for the 39-month
performance periods ended December 31, 1994, and 1995, respectively, and
option grants under the plan, as amended, for the three-year performance
periods beginning January 1, 1995 and 1996, respectively. For 1996 also
includes option grants made as awards under the plan for the 36-month
performance period ended December 31, 1996, options granted under the
Stock Option Award Guidelines and an additional option grant made to Mr.
Willison in connection with his joining Ahmanson. For 1995 also includes
an additional option grant made to Ms. Kleiner in connection with her
joining Ahmanson. For 1995 and 1996 includes options granted in lieu of
cash contributions under the 1989 Contingent Deferred Compensation Plan.
(7) For 1994, 1995 and 1996 represents the cash component of payouts under
Ahmanson's Executive Long-Term Incentive Plan for the 39-month
performance period ended December 31, 1994, and 1995 and the 36 month
performance period ending December 31, 1996, respectively. Ahmanson's
Executive Long-Term Incentive Plan provides for mandatory deferral of
that portion of a cash payout for which Ahmanson would not be allowed a
tax deduction pursuant to Section 162(m) of the Internal Revenue Code.
Pursuant to this provision, $573,000 of Mr. Rinehart's payout for 1995
was deferred. No deferrals were made in 1994 or 1996.
(8) Includes for 1996 (i) interest earned on Capital Accumulation Plan and
Elective Deferred Compensation Plan accounts at a rate greater than 120%
of the applicable federal rate and (ii) the value to the participant of
premiums paid by Ahmanson under the Senior Executive Life Insurance Plan.
<TABLE>
<CAPTION>
CHARLES R. BRUCE G. KEVIN M. MADELEINE A. ANNE-DRUE M.
YEAR RINEHART WILLISON TWOMEY KLEINER ANDERSON
---- ---------- -------- -------- ------------ ------------
<S> <C> <C> <C> <C> <C> <C>
Capital Accumulation
Plan................... 1996 $ -- $ -- $ -- $ -- $ --
Elective Deferred
Compensation Plan...... 1996 354 -- 207 -- --
Senior Executive Life
Insurance Plan......... 1996 214,122 -- 98,575 -- 22,302
</TABLE>
(9) Mr. Willison became an executive officer of Ahmanson in May 1996.
(10) Ms. Kleiner became an executive officer of Ahmanson in May 1995.
(11) Ms. Anderson became an executive officer of Ahmanson in March 1995.
9
<PAGE>
OPTION GRANTS IN LAST FISCAL YEAR
The following table sets forth certain information with respect to stock
options granted to the named executive officers during or for periods
including 1996. The table reflects multiple option grants, in part, as a
result of amendments to Ahmanson's Executive Long-Term Incentive Plan which,
among other things, changed the timing of grants of options from the end to
the beginning of the performance measurement period.
<TABLE>
<CAPTION>
INDIVIDUAL GRANTS
-----------------------------------------------------------------------------
PERCENTAGE OF
NUMBER OF SHARES TOTAL OPTIONS
UNDERLYING GRANTED TO GRANT DATE
NAME OPTIONS GRANTED EMPLOYEES EXERCISE PRICE EXPIRATION DATE PRESENT VALUE(1)
---- ---------------- ------------- -------------- --------------- ---------------
<S> <C> <C> <C> <C> <C>
Charles R. Rinehart..... 15,837 1.15% $24.00 3/6/06 $ 98,063
47,382 3.43 31.375 12/15/06 422,197
73,540 5.32 38.125 3/4/07 841,114
Bruce G. Willison....... 100,000 7.23 23.5625 5/16/06 655,038
33,666 2.44 31.375 12/15/06 299,981
25,803 1.87 38.125 3/4/07 295,122
Kevin M. Twomey......... 8,127 0.59 24.00 3/6/06 50,322
23,286 1.68 31.375 12/15/06 207,490
40,157 2.90 38.125 3/4/07 459,296
Madeleine A. Kleiner.... 6,771 0.49 24.00 3/6/06 41,926
18,236 1.32 31.375 12/15/06 162,492
30,662 2.22 38.125 3/4/07 350,697
Anne-Drue M. Anderson... 5,835 0.42 24.00 3/6/06 36,130
14,963 1.08 31.375 12/15/06 133,328
30,480 2.20 38.125 3/4/07 348,615
</TABLE>
- --------
(1) Options which expire on March 6, 2006, May 16, 2006, December 15, 2006 and
March 4, 2007 were granted on February 6, 1996, April 16, 1996, November
15, 1996 and February 4, 1997, respectively. Present values were
calculated using the Black-Scholes option valuation model with the
following assumptions:
<TABLE>
<CAPTION>
FEBRUARY 6, 1996 APRIL 16, 1996 NOVEMBER 15, 1996 FEBRUARY 4, 1997
GRANT GRANT GRANT GRANT
---------------- --------------- ----------------- ----------------
<S> <C> <C> <C> <C>
Term.................... 10 years 10 years 10 years 10 years
Exercise price.......... $24.00 $23.5625 $31.375 $38.125
Volatility.............. 30.53% 30.866% 26.885% 25.653%
Dividend yield.......... 3.67% 3.74% 2.80% 2.31%
Risk-free interest rate. 5.65% 6.51% 6.20% 6.30%
Discount for forfeiture
risk................... 2.00% 2.00% 2.00% 2.00%
Discount for reduced
term risk.............. 12.67% 12.95% 15.81% 17.19%
</TABLE>
The actual value, if any, which a named executive officer may realize
will be based upon the difference between the market price of Ahmanson's
Common Stock on the date of exercise and the exercise price. The dividend
yield assumption is based upon the dividend rate on the respective grant
dates. There is no assurance that the assumed dividend rate will be
maintained or that the actual realized value will be at or near the value
estimated by the Black-Scholes model.
The February 6, 1996 grants were made in lieu of cash contributions under
Ahmanson's 1989 Contingent Deferred Compensation Plan. The April 16, 1996
grant was made to Mr. Willison in connection with his joining Ahmanson. The
November 15, 1996 grants were made under Stock Option Award Guidelines adopted
after the deletion of the stock option awards feature under the Executive
Long-Term Incentive Plan. The Stock Option Award Guidelines provide for annual
awards based on a percent of base salary ranging from 30% to 50% using
10
<PAGE>
a Black-Scholes valuation model. The February 4, 1997 grants were made under
Ahmanson's Executive Long-Term Incentive Plan for the performance period
ending in 1996. Grants made in lieu of cash contributions under Ahmanson's
Contingent Deferred Compensation Plan were discontinued in 1996 with the
adoption of Ahmanson's Stock Option Award Guidelines.
The options become exercisable six months after grant or, if earlier, in
full upon the employee's death, disability or normal retirement or a change in
control of Ahmanson and expire three months after termination of employment
other than as a result of death, disability or retirement. Payment of the
option exercise price and tax withholding obligations may be satisfied by
withholding shares otherwise issuable upon exercise.
AGGREGATED OPTION/SAR EXERCISES AND YEAR-END OPTION/SAR VALUES
The following table sets forth certain information with respect to exercises
by the named executive officers of stock options and stock appreciation rights
("SARs") during 1996 and the value of all unexercised employee stock options
and SARs as of December 31, 1996 held by the named executive officers.
<TABLE>
<CAPTION>
NUMBER OF SHARES VALUE OF UNEXERCISED IN-
SHARES UNDERLYING UNEXERCISED THE-MONEY OPTIONS/SARS AT
ACQUIRED OPTIONS/SARS FISCAL YEAR-END (1)
ON VALUE ------------------------- -------------------------
NAME EXERCISE REALIZED EXERCISABLE UNEXERCISABLE EXERCISABLE UNEXERCISABLE
- ---- -------- -------- ----------- ------------- ----------- -------------
<S> <C> <C> <C> <C> <C> <C>
Charles R. Rinehart..... -- $ -- 503,347 47,382 $6,194,705 $53,305
Bruce G. Willison....... -- -- 100,000 33,666 893,750 37,874
Kevin M. Twomey......... -- -- 213,058 23,286 2,034,721 26,197
Madeleine A. Kleiner.... -- -- 61,946 18,236 519,699 20,516
Anne-Drue M. Anderson... 7,046 70,460 112,470 14,963 1,243,031 16,833
</TABLE>
- --------
(1) The actual amount realized from unexercised options is dependent upon the
price of Ahmanson's Common Stock at the time shares obtained upon exercise
of such options are sold and, as to unexercisable options, whether
restrictions upon exercise of such options lapse.
LONG-TERM INCENTIVE PLAN
Under Ahmanson's Executive Long-Term Incentive Plan senior executives of
Ahmanson and its subsidiaries who are designated by the Compensation Committee
are assigned a cash target award opportunity expressed as a percentage of base
annual salary in the last year of the three-year performance measurement
period.
The Plan also has provided for the grant of nonqualified stock options
relating to Ahmanson's Common Stock which are granted at the beginning of the
performance measurement period (provided, however, that for the performance
measurement period commencing January 1, 1994, any grants of options will be
made at the end of the performance measurement period). In November 1996 this
plan was amended to delete the provision for stock option awards at the
beginning of each performance cycle. At the same time, separate Stock Option
Award Guidelines were adopted. The November 1996 awards reflected above under
the caption "Option Grants in Last Fiscal Year" were made pursuant to the new
Stock Option Award Guidelines.
11
<PAGE>
The following table sets forth certain information as to target cash award
opportunities under the Executive Long-Term Incentive Plan. Actual payout
amounts will be based upon total stockholder return. Notwithstanding the
satisfaction of such criteria, the Compensation Committee may, in its
discretion, reduce the cash amount paid based upon an assessment of the
executive's performance during the last 12 months of the performance
measurement period and/or the performance of the business unit or
organizational area of Ahmanson and its subsidiaries that directly employs the
participant, if the performance of Ahmanson and its subsidiaries is not
adequately reflected in the objective measures previously determined by the
Compensation Committee and/or if Home Savings' core capital is below the level
mandated by law. Estimated future payout amounts indicated are calculated
using the named executive officers' current salaries.
LONG-TERM INCENTIVE PLAN -- AWARDS IN LAST FISCAL YEAR
<TABLE>
<CAPTION>
ESTIMATED FUTURE PAYOUTS
PERFORMANCE UNDER NON-STOCK PRICE-BASED
OR OTHER PERIOD PLANS
UNTIL MATURATION -----------------------------
NAME OF PAYOUT THRESHOLD TARGET MAXIMUM
---- ---------------- --------- -------- ----------
<S> <C> <C> <C> <C>
Charles R. Rinehart........... 3 years $382,500 $765,000 $1,147,500
Bruce G. Willison............. 3 years 240,000 480,000 720,000
Kevin M. Twomey............... 3 years 176,250 352,500 528,750
Madeleine A. Kleiner.......... 3 years 132,750 265,500 398,250
Anne-Drue M. Anderson......... 3 years 109,688 219,375 329,063
</TABLE>
RETIREMENT PLANS
Retirement Plan. Ahmanson's Retirement Plan is a qualified, noncontributory,
defined benefit retirement plan governed by the Employee Retirement Income
Security Act of 1974. The Retirement Plan is administered by a committee
appointed by the Board of Directors. With some exceptions, all employees of
Ahmanson and its participating subsidiaries (including officers) are eligible
to participate provided they meet certain age and service requirements.
The following table illustrates the estimated annual retirement benefits
payable under the Retirement Plan to participants in the following specific
average annual earnings and years of service classifications. Benefits under
the Retirement Plan are reduced in part to the extent a participant receives
Social Security benefits. Benefits paid to a participant in the Retirement
Plan who is also a participant in Ahmanson's Supplemental Executive Retirement
Plan ("SERP") or Senior Supplemental Executive Retirement Plan reduce any
benefit payable to such participant under the SERP or Senior Supplemental
Executive Retirement Plan by 100 percent of the amount of the benefit under
the Retirement Plan.
<TABLE>
<CAPTION>
YEARS OF CREDITED SERVICE
FINAL AVERAGE -----------------------------------------------------
EARNINGS 15 20 25 30 35 40
------------- -------- -------- -------- -------- -------- --------
<S> <C> <C> <C> <C> <C> <C>
$125,000 $ 37,506 $ 50,008 $ 65,634 $ 81,261 $ 87,511 $ 93,761
150,000 45,630 60,841 79,800 98,761 106,261 113,761
175,000 53,754 71,673 93,965 116,258 125,000 125,000
200,000 61,881 82,508 108,134 125,000 125,000 125,000
225,000 70,005 93,341 122,300 125,000 125,000 125,000
250,000 78,131 104,175 125,000 125,000 125,000 125,000
300,000 94,380 125,000 125,000 125,000 125,000 125,000
350,000 110,631 125,000 125,000 125,000 125,000 125,000
400,000 125,000 125,000 125,000 125,000 125,000 125,000
450,000 125,000 125,000 125,000 125,000 125,000 125,000
500,000 (and above) 125,000 125,000 125,000 125,000 125,000 125,000
</TABLE>
Benefits are paid to or on behalf of each participant upon retirement,
normally at age 65, and under certain circumstances upon death or disability.
The Retirement Plan provides for an annual benefit equal to 65 percent of
final average annual earnings reduced by 40 percent of the participant's
Social Security benefits. "Final
12
<PAGE>
average annual earnings" is the annual average compensation paid to a
participant during the final 120 months of employment, consisting of salary
and cash bonuses, subject to certain adjustments and a cap as to the amount of
compensation which may be included for each year, currently $160,000. If the
participant has fewer than 30 years of credited service in the Retirement
Plan, the participant's final average earnings are proportionately reduced.
Benefits shown in the table above are stated in the form of a single life
annuity benefit payment option and assume commencement of benefits at normal
retirement age (age 65). Participants with more than 20 years of credited
service receive an additional benefit amount equal to 1/2 of 1 percent of
final average earnings for each year of credited service in excess of 20.
Participants with more than 30 years of credited service receive an additional
1/2 of 1 percent of final average annual earnings for each year of credited
service in excess of 30. However, in no event may a participant's benefits
exceed the maximum amount permitted under the Internal Revenue Code, which for
1997 was $125,000. Retirement benefits generally vest after five years or upon
the participant's 65th birthday while employed by Ahmanson or a participating
subsidiary. The benefits payable under the Retirement Plan are actuarially
adjusted to reflect the form of payment elected by the participant and are
subject to limitations on maximum benefits imposed by applicable law. As of
February 28, 1997 the full years of credited service for Messrs. Rinehart,
Willison and Twomey and Mmes. Kleiner and Anderson were 7, 0, 3, 1 and 3,
respectively.
Supplemental Executive Retirement Plan. Ahmanson's SERP is a noncontributory
defined benefit, nonqualified plan under which Ahmanson pays benefits to
certain officers of Ahmanson and its subsidiaries designated by the
Compensation Committee of the Board of Directors in an amount equal to a
specified percentage of the participant's average annual earnings for the 36
consecutive months during the final ten years of the participant's employment
which produce the highest average annual earnings.
The following table illustrates the estimated annual retirement benefits
payable under the SERP to participants in the following specific average
annual earnings and years of service classifications. Benefits under the SERP
are reduced to the extent a participant receives benefits from primary Social
Security or Ahmanson's Retirement Plan.
<TABLE>
<CAPTION>
YEARS OF CUMULATIVE SERVICE
THREE YEAR ----------------------------
AVERAGE ANNUAL 15 AND
EARNINGS 5 10 OVER
-------------- -------- -------- ----------
<S> <C> <C> <C>
$ 250,000 $ 50,000 $100,000 $ 150,000
500,000 100,000 200,000 300,000
750,000 150,000 300,000 450,000
1,000,000 200,000 400,000 600,000
1,250,000 250,000 500,000 750,000
1,500,000 300,000 600,000 900,000
1,750,000 350,000 700,000 1,050,000
</TABLE>
The participant's average annual earnings include salary, cash bonuses and
the cash value of contingent deferred compensation grants. The compensation
for purposes of the SERP of each of the named executive officers is
substantially equivalent to the respective amounts set forth in the Summary
Compensation Table under the headings "Salary" and "Bonuses" and the cash
value of contingent deferred compensation grants as set forth in "Option
Grants in Last Fiscal Year" under the heading "Grant Date Present Value"
opposite options which expire on March 6, 2006.
The annual benefit payable to a participant under the SERP is equal to four
percent of the participant's average annual earnings multiplied by the
participant's years of cumulative service, subject to a maximum of 15 years of
cumulative service except for determination of whether a participant is
entitled to benefits upon early retirement. Service must generally continue to
at least the participant's normal retirement date for a participant to receive
full benefits under the SERP. However, a participant may retire early and
receive reduced benefits upon early retirement if the sum of his age and his
years of service equals at least 75 and the participant is at least 55. The
SERP provides for accelerated accrual and vesting of participants' interests
in the event of a change in control of Ahmanson. Benefits generally commence
under the SERP upon the participant's retirement and are paid on a modified
joint and survivor basis, which provides for a lesser annual benefit to the
participant's
13
<PAGE>
designated beneficiary upon the death of the participant. The SERP provides
for a pre-retirement survivor benefit equal to the survivor benefits a
participant's spouse would have received if the participant had elected early
retirement, offset by executive life insurance. The SERP permits participants
to elect to receive a lump sum benefit, equal to 90 percent of the present
value of the participant's accrued benefits at any time after retirement or
100 percent of the present value of the participant's accrued benefits upon
retirement if the election is made in a timely manner before retirement. Mr.
Rinehart was granted additional years of service for purposes of the
Supplemental Executive Retirement Plan and has more than the maximum 15 full
years of cumulative service. Mr. Willison was granted seven years of service
for purposes of the Supplemental Executive Retirement Plan in connection with
his joining Ahmanson. As of February 28, 1997 the full years of cumulative
service for Messrs. Willison and Twomey and Mmes. Kleiner and Anderson were 7,
3, 1 and 3, respectively.
Senior Supplemental Executive Retirement Plan. Certain officers of Ahmanson
and its subsidiaries, as designated by the Compensation Committee, participate
in an auxiliary version of the SERP, the Senior Supplemental Executive
Retirement Plan, under which a portion of the amount otherwise payable to the
participant under the SERP is offset by the participant's interest in the cash
value of split-dollar life insurance policies purchased under Ahmanson's
Senior Executive Life Insurance Plan. The post-retirement survivor benefit
payable to the participant's designated beneficiary is equal to the amount
which would have been payable under Ahmanson's SERP reduced by the additional
post-retirement death benefit payable under Ahmanson's Senior Executive Life
Insurance Plan. The pre-retirement survivor benefit payable to the
participant's designated beneficiary is equal to the amount which would have
been payable under Ahmanson's SERP reduced by the death benefit payable under
Ahmanson's Senior Executive Life Insurance Plan.
EMPLOYMENT AGREEMENTS
Ahmanson has entered into employment agreements with each of its executive
officers. Such agreements generally provide for continually renewed terms of
employment and for minimum annual salaries, payable regardless of the
disability of the employee and under certain circumstances payable for a
period of time after the termination of the officer's actual employment. The
agreements with Messrs. Rinehart, Willison and Twomey and Mmes. Kleiner and
Anderson provide for minimum annual salaries of $850,000, $600,000, $470,000,
$350,000 and $325,000, respectively.
The employment agreements with Messrs. Rinehart, Willison and Twomey and
Mmes. Kleiner and Anderson also provide that the employee may terminate the
agreement at any time with or without cause. Cause includes, among other
things, Ahmanson's failure to perform its obligations under the employment
agreement. Upon termination by the employee with cause or termination by
Ahmanson without cause, as defined in the employment agreements, Ahmanson is
obligated to pay or provide the employee, for a specified period of time after
the date of termination, his or her current salary, his or her current medical
and other insurance type benefits, continuation of vesting of all unvested
restricted stock, stock options, SARs and certain deferred compensation awards
and continuation of accrual and vesting of SERP and Senior Supplemental
Executive Retirement Plan benefits. Such benefits will be paid or provided to
each of the named executive officers for a period of three years. Special
provisions apply in the event of the employee's death or receipt of any
salary, cash bonus or other benefits from another employer during the
specified period unless such termination occurs after a change in control.
The employment agreements Ahmanson has entered into with each of the named
executive officers were revised in February 1996. Ahmanson's objectives in
revising the employment agreements were to retain executives in a period of
financial industry consolidation, minimize distraction caused by personal
circumstances so that executives can more objectively assess potential
business combinations and negotiate the best possible transactions for
stockholders, provide a change in control severance arrangement consistent
with its peer companies and better allow executives to concentrate on
restructuring a merged entity should a change in control occur. The agreements
with the named executive officers were amended to provide a 30 day period one
year after a change in control during which a voluntary termination of
employment will trigger severance benefits and to include the annual bonus as
part of the compensation afforded severance protection. Upon a change in
14
<PAGE>
control, the revised agreements will add service and vesting credits under
Ahmanson's SERP equal to the remaining term of the agreement instead of
service and vesting credits equal to 50% of the executive officer's prior
service as was the case under the prior agreements. A gross-up provision was
added to the new agreements for federal excise taxes on excess parachute
payments after a change in control. The term of the agreements with Mmes.
Kleiner and Anderson was extended to three years from two years.
COMPENSATION OF DIRECTORS
Directors who are also employees of Ahmanson or any of its subsidiaries
receive no additional compensation for their services as directors, including
service on committees of the Board of Directors. Each other director receives
an annual fee of $24,000 for serving on the Board of Directors and $1,500 for
each meeting of the Board of Directors attended. Each member of the Executive
Committee receives an annual fee of $3,000 and each member of the Audit,
Compensation and Nominating Committee receives an annual fee of $2,400 for
each such committee on which the director serves. Each Chairperson of the
Audit, Compensation and Nominating Committees receives an additional fee of
$7,500. Each director receives an additional payment of $600 for each
Committee meeting attended. Directors, and in limited circumstances, their
spouses, are reimbursed for travel and other expenses related to attendance at
Board of Directors and committee meetings.
Directors of Ahmanson who are not employees of Home Savings or any of its
subsidiaries receive additional fees for attending meetings of the Home
Savings Board of Directors that are not held jointly with meetings of the
Ahmanson Board of Directors. The Home Savings Board of Directors held seven
meetings during 1996 separately from the Ahmanson Board of Directors.
Ahmanson's Outside Director Retirement Plan is a nonqualified retirement
plan for directors of Ahmanson who are not also employees of Ahmanson or any
of its subsidiaries. Under the Plan a participating director receives an
annual retirement benefit equal to the director's annual fee during the 12
month period immediately preceding the participant's retirement from the
Board. Benefits under this Plan generally are payable for a period equal to
the participant's aggregate years and months of service on the Board of
Directors plus time spent in certain governmental service, with a lifetime
benefit payable to participants with 15 or more years of service. Benefit
payments commence when the participant ceases being a director. Upon the death
of the participant, the participant's designated beneficiary is entitled to 50
percent of the benefits otherwise payable to the participant. Such death
benefits commence one month after the participant's death and continue for the
payment period applicable to the participant or, if the participant had
already begun receiving benefits under the Plan, for the participant's
remaining payment period with a maximum of 15 years of payment. The Plan
permits participants to elect to receive a lump sum benefit equal to 90
percent of the present value of the participant's accrued benefits at any time
after retirement or 100 percent of the present value of the participant's
accrued benefits upon retirement if the election is made in a timely manner
before retirement.
Ahmanson's 1996 Nonemployee Directors' Stock Incentive Plan (the "1996
Plan") provides for the grant to any director of Ahmanson who is not an
employee of Ahmanson or any of its present or future parent or subsidiary
corporations (a "Nonemployee Director") of stock options. Whenever any person
becomes a Nonemployee Director, such person is granted automatically options,
the date of grant of which is the date such person becomes a Nonemployee
Director, to purchase 2,000 shares of Ahmanson Common Stock. In addition, on
the first business day of each calendar year during the term of the 1996 Plan,
each Nonemployee Director then in office is automatically granted options to
purchase 2,000 shares of Ahmanson Common Stock. However, no Nonemployee
Director may receive in any calendar year under the foregoing provisions of
the 1996 Plan options to purchase more than 2,000 shares of Ahmanson Common
Stock.
Additional options will be granted automatically on the first business day
of each calendar year to any Nonemployee Director who files with Ahmanson an
irrevocable election to receive options in lieu of all or part of annual
directors' fees to be earned in each succeeding calendar year.
15
<PAGE>
Options granted under the 1996 Plan may be exercisable for a term no longer
than ten years and one month. The options become exercisable one year after
grant (six months for options granted in lieu of directors' fees) as to half
of the shares subject to the options and two years (one year for options
granted in lieu of directors' fees) after grant as to the balance of the
shares or, if earlier, in full upon the director's death, disability or normal
retirement or a change in control of Ahmanson and expire three months after
termination of directorship other than as a result of death, disability or
normal retirement.
Ahmanson's 1996 Nonemployee Directors' Stock Incentive Plan replaced the
1988 Plan pursuant to which directors had received options with substantially
similar terms.
In March 1997, the Board of Directors adopted stock ownership guidelines for
Ahmanson's directors providing for ownership of Ahmanson common stock by the
end of a five year period. The guidelines for directors provide for the
ownership of Ahmanson common stock by each director in an amount equal to five
times their annual retainer.
Ahmanson also provides at no charge to its nonemployee directors health and
dental benefits substantially comparable to those afforded to its employees
under Ahmanson's group insurance plans and provides retiree health benefits at
no charge.
CERTAIN TRANSACTIONS
For many years Home Savings had a home loan program under which directors,
officers and employees of Home Savings, Ahmanson and certain affiliated
companies could obtain loans, secured by a first deed of trust on the
borrower's principal residence, at a fixed rate at least one percent above
Home Savings' cost of funds for the first six months and adjusted thereafter
based upon changes in the monthly weighted average cost of funds of savings
institutions headquartered in the Eleventh District of the Federal Home Loan
Bank System as long as the borrower remained, or retired as, a director,
officer or employee of Home Savings, Ahmanson or certain affiliated companies.
The current program prohibits directors, executive officers and certain other
senior officers from obtaining loans at a discounted rate.
The following table sets forth as to each present executive officer of
Ahmanson who had a home loan from Home Savings under this home loan program
(i) the largest aggregate indebtedness outstanding from January 1, 1996 to
February 28, 1997, (ii) the amount of such indebtedness outstanding on
February 28, 1997 and (iii) the rate of interest on such indebtedness on
February 28, 1997. No present director of Ahmanson had a home loan from Home
Savings under this home loan program.
<TABLE>
<CAPTION>
HIGHEST
INDEBTEDNESS UNPAID BALANCE INTEREST RATE ON
SINCE ON FEBRUARY 29, FEBRUARY 29,
NAME DECEMBER 31, 1995 1996 1996
---- ----------------- --------------- ----------------
<S> <C> <C> <C>
George Miranda.......... 200,268.35 194,027.31 5.842%
</TABLE>
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
The members of the Compensation Committee during 1996 were Byron Allumbaugh,
Richard M. Bressler, Delia M. Reyes and Elizabeth A. Sanders. Lodwrick M. Cook
served until his retirement from the Board in March 1996. Phillip D. Matthews
was appointed to the Committee in May 1996.
Certain directors, including four members of the Compensation Committee,
officers and stockholders of Ahmanson and their associates were depositors,
borrowers and customers of and engaged in transactions with Home Savings, and
certain other subsidiaries of Ahmanson in the ordinary course of business
during 1996. Similar transactions are expected to occur in the future. All
such loans and transactions with members of the Compensation Committee were
made on substantially the same terms, including interest rates, fees and
security, as those prevailing at the time for comparable loans and
transactions with other persons and did not involve more than the normal risk
of collectibility or present any other unfavorable features.
16
<PAGE>
REPORT OF THE COMPENSATION COMMITTEE ON EXECUTIVE COMPENSATION
The Compensation Committee of the Board of Directors, which is comprised
exclusively of nonemployee directors, is responsible for developing Ahmanson's
executive compensation policies, administering Ahmanson's various management
incentive programs, and making recommendations to the Board with respect to
those policies and programs. In addition, the Committee determines the
compensation paid to the Chief Executive Officer and to each of the other
senior officers of Ahmanson.
EXECUTIVE COMPENSATION POLICY
The policy of the Committee is to closely link the compensation of
Ahmanson's executive officers to Ahmanson's financial performance and the
total returns (price appreciation and dividends) generated for Ahmanson's
stockholders. To this end, it is the Committee's policy to generally position
executive officer salaries at median competitive levels and to rely on
variable, performance-based incentives to play a significant role in
determining total compensation. Based on this policy, Ahmanson's financial and
stockholder return performance generally must exceed the median performance of
other comparable financial institutions before executive total compensation
exceeds median competitive practice.
In March 1997, the Compensation Committee adopted stock ownership guidelines
for Ahmanson's executive and certain other senior officers providing for the
ownership of Ahmanson common stock by the end of a five year period. The
guidelines provide for the ownership of Ahmanson common stock by the chief
executive officer in an amount equal to five times his salary, ownership by
the other executive officers in amounts equal to three times their salaries,
and ownership by certain other senior officers in amounts equal to one times
their salaries.
The key components of Ahmanson's executive compensation program include base
salary, an annual incentive plan tied to the annual performance of Ahmanson
and the individual participant, and a long-term incentive program with payment
based on Ahmanson's total stockholder return performance over a three-year
period. Earned awards for 1996 were payable partly in stock and partly in
cash. In November 1996 this plan was amended to delete the provision for stock
options awards at the beginning of each performance cycle. At the same time,
separate Stock Option Award Guidelines were adopted. The November 1996 awards
reflected above under the caption "Option Grants In Last Fiscal Year" were
made pursuant to the new Stock Option Award Guidelines. In keeping with the
Committee's policy of linking executive officer pay closely to performance,
approximately 57 percent of the target total compensation of Ahmanson's senior
officer group consists of variable, performance-based compensation delivered
through the annual bonus and long-term incentive plans.
As described earlier in this proxy statement, each of Ahmanson's executive
officers is covered by an employment agreement which, among other things,
specifies a minimum annual base salary for each officer. See "Employment
Agreements" above. The Committee may, in its discretion, increase base
salaries above the minimum level specified in the agreements, but, in the
absence of cause, may not thereafter decrease salaries below those levels.
Based on external compensation information provided by Hewitt Associates,
Ahmanson's benefits advisor, the current base salaries of Ahmanson's senior
officer group as a whole fell approximately at the median base salaries of
other comparable organizations. The target total compensation (the sum of base
salary, the target annual incentive opportunity and the target value of long-
term incentives) of the group falls approximately 14 percent below the market
median.
Under the 1993 Omnibus Budget Reconciliation Act ("OBRA"), income tax
deductions of publicly-traded companies may be limited to the extent that
total compensation (including base salary, annual and longer-term incentives,
gains from stock option exercises and certain benefits) for certain executive
officers exceeds $1 million. Under OBRA, the deduction limit does not apply to
payments which qualify as "performance-based." To qualify as "performance-
based," compensation payments must be based solely upon the
17
<PAGE>
achievement of objective performance goals under a plan that is administered
by a committee of outside directors. In addition, the material terms of the
plan must be disclosed to and approved by stockholders, and the compensation
committee must certify that the performance goals were achieved before
payments can be made.
It is the intent of the Committee to structure Ahmanson's compensation
programs to conform with the OBRA legislation and related regulations so that
total compensation paid to any employee will not exceed $1 million in any one
year, except for compensation payments which qualify as "performance-based" or
are exempt for other reasons. However, Ahmanson may in limited circumstances
pay compensation which is not deductible if sound management of Ahmanson so
requires.
EXECUTIVE SHORT-TERM INCENTIVE PLAN
Ahmanson's Executive Short-Term Incentive Plan provides for an annual cash
award opportunity based on actual company performance compared to budget,
subject to reduction of actual awards at the discretion of the Compensation
Committee. Performance measures for 1996 were Ahmanson's earnings per share
and return on equity adjusted based on changes in the 11th District Cost of
Funds Index.
Target annual incentive awards are established for each participant ranging
from 100 percent of base salary for the chief executive officer and from 10
percent to 70 percent of base salary for other eligible employees. Actual
payments may vary from zero percent to 200 percent of the target award based
on the level of company performance achieved, subject to reduction at the
discretion of the Compensation Committee. For 1996 threshold awards equal to
40 percent of the target award were available for achievement equal to 60
percent of budgeted earnings per share and 60 percent of budgeted return on
equity. Awards equal to 100 percent of the target award were available for
achieving 100 percent of budgeted earnings per share and 100 percent of
budgeted return on equity.
For 1996 Ahmanson's earnings per share performance was 113.1 percent of
budget and return on equity was 115.1 percent of budget, resulting in a
formula payout to executives of 146.67 percent of target, subject to reduction
at the discretion of the Compensation Committee.
EXECUTIVE LONG-TERM INCENTIVE PLAN
Ahmanson's Executive Long-Term Incentive Plan for the three year performance
cycle ended December 31, 1996 provided its executives an award opportunity
payable one-half in cash and one-half in stock options. The actual cash awards
are based on Ahmanson's relative performance in total stockholder return
("TSR") over the three-year period compared to companies comprising the S&P
500 Index and the companies comprising the S&P Banks Composite Index.
Similar to the annual incentive plan, cash target awards for each
performance measurement period are established for each plan participant and
range from 90 percent of base salary for the Chief Executive Officer and from
42.5 percent to 80 percent of base salary for other eligible senior officers.
Except for certain awards that may be adjusted downward only, actual payments
under the plan may vary from zero percent to 150 percent of the target award.
A threshold payment equal to 50 percent of the target award is available for
achieving 40th percentile relative performance, while target awards are
available for achieving 50th percentile TSR performance.
For the three year performance cycle ended December 31, 1996, Ahmanson's
relative TSR performance equaled approximately the 56th percentile of the
group. This performance resulted in a formula payout equal to 113.75 percent
of the target opportunity, subject to reduction at the discretion of the
Compensation Committee. Half of this payout was made in the form of stock
options granted in February 1997. Pursuant to amendments to the Executive
Long-Term Incentive Plan in 1994, the timing of grants of stock options was
changed from the end to the beginning of the performance measurement period.
In November 1996, this plan was amended to delete the provision for stock
options awards at the beginning of each performance cycle. At the same time,
separate Stock Option Award Guidelines were adopted. In February
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<PAGE>
1997, target cash awards were established under the Executive Long-Term
Incentive Plan for the performance measurement period beginning January 1,
1997. In November 1996, stock options were granted under the Stock Option
Award Guidelines. The Guidelines provide for annual awards based on a percent
of base salary ranging from 30% to 50% using a Black-Scholes valuation model.
The table captioned "Options Granted in Last Fiscal Year" reflects both the
February 1997 grants under the Executive Long-Term Incentive Plan and the
November 1996 awards made pursuant to the new Stock Option Award Guidelines.
CEO COMPENSATION
Mr. Rinehart's salary was increased in February 1997 and was last increased
in October 1994. Based on the competitive data for comparable positions
provided by Hewitt, Mr. Rinehart's base salary is about 2.5 percent below the
median for other comparative organizations.
For the year ending on December 31, 1996, Mr. Rinehart received 100 percent
of his target opportunity under Ahmanson's annual incentive plan in the form
of a cash payment of $891,763. The aggregate award was entirely formula-based.
In determining not to reduce Mr. Rinehart's annual incentive award from the
formula-based amount, the Committee took into consideration his significant
contributions to the financial and strategic actions taken to position
Ahmanson for future success.
For the three year performance measurement period ended on December 31,
1996, Mr. Rinehart received a cash award under Ahmanson's long-term incentive
plan of $778,058 (100 percent of the target award) representing the amount
generated by the plan formula based on Ahmanson's relative TSR performance
over the period. Consistent with other plan participants, one-half of Mr.
Rinehart's long-term incentive payment was provided in the form of a ten-year
stock option, with an exercise price equal to the market price of Ahmanson's
stock as of the date of grant. The translation of Mr. Rinehart's long-term
incentive award payment into a stock option was determined by a growth model
formula (which formula resulted in fewer options being granted than if the
Black-Scholes option valuation model were used) that determines the cash-
equivalent value of a stock option on the date of grant and that resulted in a
grant of an option to purchase 73,540 shares.
The foregoing report has been approved by the following members of the
Committee:
Byron Allumbaugh
Richard M. Bressler
Phillip D. Matthews
Delia M. Reyes
Elizabeth A. Sanders
The report of the Compensation Committee shall not be deemed incorporated by
reference by any general statement incorporating by reference this proxy
statement into any filing under the Securities Act of 1933 or under the
Securities Exchange Act of 1934, except to the extent that Ahmanson
specifically incorporates this information by reference and shall not
otherwise be deemed filed under such Acts.
SECTION 16(A) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
Section 16(a) of the Securities and Exchange Act of 1934 requires directors
and certain officers of Ahmanson and persons who own more than 10% of the
registered class of Ahmanson's equity securities to file with the Securities
and Exchange Commission and any national securities exchange on which
Ahmanson's equity securities are registered. Initial reports of ownership and
reports of changes in ownership of Ahmanson Common Stock and other equity
securities of Ahmanson. Officers, directors and beneficial owners of more than
10% of Ahmanson's equity securities are required by regulations of the
Securities and Exchange Commission to furnish Ahmanson with copies of all
Section 16(a) forms they file.
19
<PAGE>
To Ahmanson's knowledge, based solely upon a review of the copies of such
forms furnished to Ahmanson and written representations that no other reports
were required, during the 1996 fiscal year ended December 31, 1996, all Section
16(a) filing requirements applicable to its officers, directors and beneficial
owners of more than 10% of Ahmanson's equity securities were met in a timely
manner.
STOCKHOLDER RETURN PERFORMANCE GRAPH
COMPARISON OF FIVE-YEAR CUMULATIVE TOTAL RETURN
AMONG H.F. AHMANSON & COMPANY, S&P 500 INDEX AND
S&P BANKS COMPOSITE INDEX
PERFORMANCE GRAPH APPEARS HERE
<TABLE>
<CAPTION>
S&P BANKS
Measurement Period H.F. AHMANSON S&P COMPOSITE
(Fiscal Year Covered) & COMPANY 500 INDEX INDEX
- ------------------- ------------- --------- ----------
<S> <C> <C> <C>
Measurement Pt- 12/31/1991 $100 $100 $100
FYE 12/31/1992 $117 $108 $129
FYE 12/31/1993 $125 $118 $138
FYE 12/31/1994 $108 $120 $132
FYE 12/31/1995 $184 $165 $204
FYE 12/31/1996 $233 $203 $288
</TABLE>
The above stock performance graph illustrates Ahmanson's performance in total
stockholder return over the period December 31, 1991 through December 31, 1996
relative to the Standard & Poors 500 Index and the Standard & Poors Banks
Composite Index.
Each line on the stock performance graph assumes that $100 was invested in
Ahmanson's Common Stock and the respective indices on December 31, 1991. The
graph then tracks the value of these investments, assuming reinvestment of the
dividends, through December 31, 1996. The cumulative total return shown on the
performance graph indicates historical results only and is not necessarily
indicative of future results.
The stock performance graph shall not be deemed incorporated by reference by
any general statement incorporating by reference this proxy statement into any
filing under the Securities Act of 1933 or under the Securities Exchange Act of
1934, except to the extent that Ahmanson specifically incorporates this
information by reference, and shall not otherwise be deemed filed under such
Acts.
20
<PAGE>
STOCKHOLDER PROPOSAL
Ahmanson has received a proposal from two of its stockholders which
beneficially own a total of 27,100 shares of Common Stock that a resolution be
presented for adoption at the Annual Meeting of Stockholders. The name and
address of the stockholders who submitted the proposal will be provided orally
or in writing, as requested, upon receipt of an oral or written request for
such information. The text of the resolution and the statement in support
thereof are as follows:
EQUAL CREDIT OPPORTUNITY--COMMUNITY REINVESTMENT
WHEREAS the performances on mortgage lending to minority borrowers in
California in 1995 by Ahmanson's subsidiary, Home Savings of America, were in
sharp contrast to the performances of Ahmanson's subsidiaries in the rest of
the country, according to analysis of the 1995 Home Mortgage Disclosure Act
(HMDA) data by CANICCOR.
WHEREAS the 1995 performance of Home Savings, based on HMDA data, when
compared with the performance of the industry as a whole, shows although the
Company's originations to Blacks of purchase mortgages for owner-occupied
homes in California was 13% below the average performance in the industry,
comparable originations in Florida were 70% below the average performance in
the industry, comparable originations in Texas were 59% below and in Illinois
42% below. Thus, in the three non-California states, the Company was
approximately 59% below average performance (calculated in proportion to the
Company's relative presence in each state). Similarly, the data show that
although the Company's origination to Hispanics of purchase mortgages for
owner-occupied homes in California was 6% below the average performance in the
industry, comparable origination in Florida were 30% below the average
performance in the industry, comparable origination in Texas were 32% below
and in Illinois 34% below. Thus, in the three non-California states, the
Company was approximately 31% below average performance. (The methodology
employed in each instance was to evaluate the performance at the level of the
metropolitan statistical area (MSA), and then these MSA performances were
summed to the state level by weighing each MSA performance by the number of
loans in the industry portfolio to Black or Hispanic borrowers in each MSA,
and the industry portfolio was then scaled to the same size as Ahmanson's
portfolio in that MSA.)
WHEREAS if these lower performances continue into 1996, they raise questions
about the compliance of the Corporation's subsidiaries with respect to the
Equal Credit Opportunity Act (ECOA).
WHEREAS the Equal Credit Opportunity Act (ECOA) prohibits lenders from
discriminating in any aspect of a credit transaction with regard to race or
color, religion, national origin, sex, marital status, or age and a lender can
be in violation of the ECOA when it applies a policy or practice equally to
credit applicants, but the policy or practice has a disproportionately adverse
impact on applicants from a group protected against discrimination. Such a
policy or practice is described as having a "disparate impact" and can only be
justified on necessary business grounds.
WHEREAS several lenders have entered into agreements with the Justice
Department arising out of alleged lending discrimination. These include
Northern Trust, Shawmut, and Chevy Chase Federal Savings Bank. The latter
agreed to open a new branch in Washington, DC, and Shawmut agreed to pay
damages to minority loan applicants.
WHEREAS we believe our corporation has a duty and a business opportunity to
incorporate its depository and other financial subsidiaries in a coherent
corporate-wide program which would insure its compliance with both the Equal
Credit Opportunity Act and the Community Reinvestment Act and avoid any
possibility of accusations of disparate impact.
BE IT RESOLVED that the shareholders request the Board of Directors to
develop an overall FAIR LENDING POLICY which includes all financial
subsidiaries of the corporation with a general program goal of
21
<PAGE>
achieving at least the industry level of HMDA reportable lending to each major
disadvantaged group IN EACH MAJOR MARKET AREA and to report annually to
shareholders on its achievements.
THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS A VOTE AGAINST THE STOCKHOLDER
PROPOSAL FOR THE FOLLOWING REASONS:
The Proposal requests that Ahmanson (and its financial subsidiaries)
subordinate its current overall mortgage lending policy and specific lending
practices to a ". . .general program goal of achieving at least the industry
level of HMDA reportable lending to each major disadvantaged group in each
major market area. . ." in which Ahmanson operates. Management believes that
the proposal is unnecessary because Ahmanson's management has already adopted
and implemented lending policies to help disadvantaged groups in a manner
consistent with federal law. Ahmanson has demonstrated and will continue to
demonstrate a commitment to fair lending policies, but management's ability to
assess lending risk, comply with safe and sound banking practices, abide by
the many federal regulations which govern Ahmanson's business, and otherwise
promote the economic interests of the Company and its shareholders should not
be hampered by a proposal, such as the one presented here, designed to replace
such considerations with a policy of lending quotas.
The Office of Thrift Supervision (the "OTS"), Home Savings' primary
regulator, conducts periodic examinations of lenders and issues ratings known
as CRA ratings, which are designed to evaluate performance under the Community
Reinvestment Act. These evaluations specifically consider Home Savings'
lending performance in low- to moderate-income and minority areas in
comparison to the performance of other lenders in those areas, i.e., the
"industry level of lending." And they consider Home Savings' lending
performance with respect to minority borrowers. However, they also consider
any business constraints on performance such as safety and soundness
considerations or limited market presence. Ahmanson is proud of the fact that
the CRA performance of Home Savings (Ahmanson' chief lending subsidiary) was
rated "outstanding", the highest rating attainable, in each of the past four
examinations.
The operations of Ahmanson and its lending subsidiaries are already subject
to extensive federal regulations such as the Home Mortgage Disclosure Act
("HMDA"), the Equal Credit Opportunity Act ("ECOA"), the Community
Reinvestment Act ("CRA"), and the Fair Housing Act ("FHA"), which collectively
work to ensure that Ahmanson adheres to fair lending policies. Home Savings'
Board of Directors has specifically mandated compliance with ECOA and CRA and
has incorporated fair lending and CRA considerations into its business
strategies. One of Ahmanson's business goals is to increase its market share
of mortgage lending in all of its markets, subject to considerations such as
prudent underwriting, avoiding geographic concentrations of credit, and the
availability of funds. For example, Home Savings has active marketing programs
targeting the Hispanic, African-American, and Asian communities. In addition,
regional managers with responsibility for lending periodically are provided
information that identifies low- to moderate-income and minority areas within
those markets with the most potential for increasing loan production. These
managers are required to implement and report on the progress of business
plans intended to increase the solicitation and ultimate receipt of loan
applications from areas identified in this manner.
In fact, management believes that the Proposal, if implemented, may actually
make it more difficult for Ahmanson to comply with all relevant federal
regulations. Home Savings, a federal savings bank, is subject to regulation by
the OTS under the Home Owners' Loan Act and the Federal Deposit Insurance Act.
Under federal banking law, Home Savings' lending must comply with safe and
sound banking practices. In the absence of such compliance, Home Savings would
be subject to regulatory enforcement action and civil money penalties. To aid
compliance, the OTS in its Lending and Investment regulations advance many
factors that Home Savings must consider in fashioning an overall lending
policy designed to ". . .identify the purpose and all sources of repayment for
each loan, and assess the ability of the borrower(s). . .to repay the
indebtedness in a timely manner; . . .ensure that any claims against the
borrower. . .are legally enforceable;. . .demonstrate appropriate
administration and monitoring of its loans; and. . .take into account the size
and complexity of its loans." "Achieving at least the industry level of
lending" to "disadvantaged" groups is not among these factors. By forcing
Ahmanson to commit to a policy of quota driven lending decisions, the Proposal
could jeopardize
22
<PAGE>
Ahmanson's ability to assess individual lending risk and underwrite loans in a
manner consistent with its obligations under federal banking law. Therefore,
your Board of Directors cautions against voting for a policy that would apply
rigid targets as part of the Company's overall lending policy and recommends
that you allow management to continue to provide for credit assessments that
are made in accordance with federal regulations and based on community needs.
The Proposal also requests that Ahmanson regularly report on its lending
performance to its shareholders. Under HMDA, the information proposed to be
reported already is available to any interested member of the public upon
request. Additional information on Home Savings' performance in meeting the
credit needs of its communities is contained in its CRA examination report,
which also is available to any interested member of the public.
Ahmanson is committed to be an industry leader in fair lending and community
reinvestment. Ahmanson's management has worked hard to formulate lending
policies that are consistent with federal regulations, in compliance with fair
lending requirements, fair, and in the best economic interest of the Company,
its communities, and its shareholders. The Company believes that it would be
imprudent to limit the continued exercise of that business judgment discretion
and, accordingly, the Board of Directors believes that the stockholder
proposal, if adopted, would not be in the best interests of Ahmanson.
THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS A VOTE AGAINST THE STOCKHOLDER
PROPOSAL.
INDEPENDENT PUBLIC ACCOUNTANTS
KPMG Peat Marwick LLP ("Peat Marwick"), the independent certified public
accountants for Ahmanson and its subsidiaries in 1996, have been selected by
the Board of Directors to continue to serve Ahmanson in that capacity for
1997. Representatives of Peat Marwick are expected to be present at the Annual
Meeting of Stockholders to make a statement should they desire to do so and
will be available to respond to appropriate questions which may be asked by
stockholders.
Peat Marwick performs both audit and non-audit professional services for and
on behalf of Ahmanson and its subsidiaries. During 1996 the audit services
included examination of the consolidated financial statements of Ahmanson,
examination of the financial statements of subsidiaries of Ahmanson and a
review of certain filings with the Securities and Exchange Commission and
other regulatory agencies.
STOCKHOLDER PROPOSAL FOR THE 1998 ANNUAL MEETING OF STOCKHOLDERS
Any eligible stockholder of Ahmanson wishing to have a proposal considered
for inclusion in Ahmanson's 1998 proxy solicitation materials must set forth
such proposal in writing and file it with the Secretary of Ahmanson on or
before November 21, 1997 and satisfy the other requirements of Rule 14a-8
under the Securities Exchange Act of 1934. The Board of Directors of Ahmanson
will review new proposals received by that date from eligible stockholders and
will determine whether such proposals will be included in its 1998 proxy
solicitation materials. Generally a stockholder is eligible to present
proposals if such stockholder has been for at least one year the record or
beneficial owner of at least one percent or $1,000 in market value of
securities entitled to be voted at the 1998 Annual Meeting of Stockholders and
such stockholder continues to own such securities through the date on which
the meeting is held. To be considered at the 1998 Annual Meeting of
Stockholders, a stockholder proposal must comply with the requirements of
Ahmanson's Bylaws.
23
<PAGE>
H. F. AHMANSON & COMPANY
PROXY SOLICITED BY BOARD OF DIRECTORS
The undersigned acknowledges receipt of the Notice of Annual Meeting and
Proxy Statement, each dated March 21, 1997, and hereby appoints Byron
Allumbaugh, Richard M. Bressler, Charles R. Rinehart, Arthur W. Schmutz and
P Bruce G. Willison and each of them, acting by a majority or by one of them
if only one is acting, with power of substitution, the agent and proxy of
R the undersigned to vote the shares of common stock of H. F. Ahmanson &
Company, a Delaware corporation ("Ahmanson"), standing in the name of the
O undersigned at the Annual Meeting of Stockholders to be held on April
21, 1997, and at any adjournment or postponement thereof, with respect to
X the following:
Y 1. Election of directors: (change of address/comments)
Nominees--Byron Allumbaugh, ___________________________
Harold A. Black, Richard M. Bressler, ___________________________
David R. Carpenter, Phillip D. Matthews, ___________________________
Richard L. Nolan, Delia M. Reyes, ___________________________
Charles R. Rinehart, Frank M. Sanchez, ___________________________
Elizabeth A. Sanders, Arthur W. Schmutz, ___________________________
William D. Schulte and Bruce G. ___________________________
Willison ___________________________
(If you have written in the
above space, please mark the
corresponding box on the
reverse side of this card.)
THIS PROXY WILL BE VOTED AS DIRECTED ON SEE REVERSE
THE REVERSE SIDE. IN THE ABSENCE OF ANY SIDE
DIRECTION, THIS PROXY WILL BE VOTED FOR
THE NOMINEES FOR DIRECTORS NAMED ABOVE
AND AGAINST PROPOSAL 2.
<PAGE>
[X] Please mark your
votes as in this
example
- --------------------------------------------------------------------------------
The Board of Directors recommends a vote FOR Directors.
- --------------------------------------------------------------------------------
FOR AGAINST WITHHELD
1. Election of Directors [_] [_] [_]
(see reverse)
For, except vote withheld from the
following nominee(s): ___________________________________
___________________________________
___________________________________
- - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - -
The Board of Directors recommends a vote AGAINST the adoption of the Shareholder
Proposal.
- - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - -
FOR AGAINST WITHHELD
2. Shareholder Proposal - Precatory resolution [_] [_] [_]
relating to lending to disadvantaged groups.
- - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - -
3. In their discretion, the Proxies are authorized
to vote upon such other business as may properly
come before such meeting or any adjournment
thereof.
- --------------------------------------------------------------------------------
Change [_]
of
Address/
Comments
SIGNATURE(S)___________________________________________ DATE:_______________
NOTE: Please sign exactly as name appears above. Joint owners should each
sign. Fiduciaries should add their full title to their signature.
Corporations should sign in full corporate name by an authorized officer.
Partnerships should sign in partnership name by an authorized person.
<PAGE>
VOTING INSTRUCTIONS
H. F. AHMANSON & COMPANY
THE AHMANSON ADVANTAGE ACCOUNT
PROXY SOLICITED ON BEHALF OF BOARD OF DIRECTORS
The undersigned acknowledges receipt of the Notice of Annual Meeting and
P Proxy Statement, dated March 21, 1997, and hereby appoints Bankers
Trust Company, as trustee of The Ahmanson Advantage Account, (the "Plan"),
R to vote in person or by proxy all shares of common stock of H.F. Ahmanson &
Company, a Delaware corporation ("Ahmanson"), allocated to any accounts of
O the undersigned under the Plan at the Annual Meeting of Stockholders to be
held on April 21, 1997, and at any adjournment or postponement thereof,
X with respect to the following:
Y 1. Election of directors: (change of address/comments)
Nominees--Byron Allumbaugh, ___________________________
Harold A. Black, Richard M. Bressler, ___________________________
David R. Carpenter, Phillip D. Matthews, ___________________________
Richard L. Nolan, Delia M. Reyes, ___________________________
Charles R. Rinehart, Frank M. Sanchez, ___________________________
Elizabeth A. Sanders, Arthur W. Schmutz, ___________________________
William D. Schulte and Bruce G. ___________________________
Willison ___________________________
(If you have written in the
above space, please mark the
corresponding box on the
reverse side of this card.)
THE TRUSTEE WILL VOTE AS DIRECTED ON SEE REVERSE
THE REVERSE SIDE. IF THESE VOTING SIDE
INSTRUCTIONS ARE NOT RETURNED BY
APRIL 17, 1997, OR IN THE ABSENCE OF
ANY EXPRESSED DIRECTION, THE TRUSTEE
WILL VOTE FOR THE NOMINEES FOR
DIRECTORS NAMED ABOVE AND AGAINST
PROPOSAL 2.
<PAGE>
[X] Please mark your
votes as in this
example
- --------------------------------------------------------------------------------
The Board of Directors recommends a vote FOR Directors.
- --------------------------------------------------------------------------------
FOR WITHHELD
1. Election of Directors [_] [_]
(see reverse)
For, except vote withheld from the
following nominee(s): ___________________________________
___________________________________
- - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - -
The Board of Directors recommends a vote AGAINST the adoption of the Shareholder
Proposal.
- - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - -
FOR AGAINST ABSTAIN
2. Shareholder Proposal - Precatory resolution [_] [_] [_]
relating to lending to disadvantaged groups.
- - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - -
3. In their discretion, the Proxies are authorized
to vote upon such other business as may properly
come before such meeting or any adjournment
thereof.
- --------------------------------------------------------------------------------
Change [_]
of
Address/
Comments
SIGNATURE(S)___________________________________________ DATE:_______________
NOTE: Please sign exactly as name appears above. Joint owners should each
sign. Fiduciaries should add their full title to their signature.
Corporations should sign in full corporate name by an authorized officer.
Partnerships should sign in partnership name by an authorized person.
