<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
ISB FINANCIAL CORPORATION
- --------------------------------------------------------------------------------
(Name of Registrant as Specified in Its Charter)
- --------------------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
/X/ No fee required.
/ / Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and 0-11.
(1) Title of each class of securities to which transaction applies:
_____________________________________________________________
(2) Aggregate number of securities to which transaction applies:
_____________________________________________________________
(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (Set forth the amount on which the
filing fee is calculated and state how it was determined):
_____________________________________________________________
(4) Proposed maximum aggregate value of transaction:
_____________________________________________________________
(5) Total fee paid:
_____________________________________________________________
/ / Fee paid previously with preliminary materials.
/ / Check box if any part of the fee is offset as provided by Exchange Act
Rule 0-11(a)(2) and identify the filing for which the offsetting fee was
paid previously. Identify the previous filing by registration statement
number, or the Form or Schedule and the date of its filing.
(1) Amount Previously Paid:
_____________________________________________________________
(2) Form, Schedule or Registration Statement No.:
_____________________________________________________________
(3) Filing Party:
_____________________________________________________________
(4) Date Filed:
_____________________________________________________________
<PAGE>
[LETTERHEAD]
March 18, 1998
Dear Stockholder:
You are cordially invited to attend the Annual Meeting of Stockholders
of ISB Financial Corporation. The meeting will be held at the main office of
IBERIABANK located at 1101 East Admiral Doyle Drive, New Iberia, Louisiana, on
Wednesday, April 15, 1998 at 3:00 p.m., Central Time. The matters to be
considered by stockholders at the Annual Meeting are described in the
accompanying materials.
It is very important that you be represented at the Annual Meeting
regardless of the number of shares you own or whether you are able to attend the
meeting in person. We urge you to mark, sign, and date your proxy card today and
return it in the envelope provided, even if you plan to attend the Annual
Meeting. This will not prevent you from voting in person, but will ensure that
your vote is counted if you are unable to attend.
Your continued support of and interest in ISB Financial Corporation are
sincerely appreciated.
Sincerely,
Larrey G. Mouton
President and Chief Executive Officer
<PAGE>
ISB FINANCIAL CORPORATION
1101 E. Admiral Doyle Drive
New Iberia, Louisiana 70560
(318) 365-2361
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
To Be Held on April 15, 1998
NOTICE IS HEREBY GIVEN that the Annual Meeting of Stockholders ("Annual
Meeting") of ISB Financial Corporation (the "Company") will be held at the main
office of IBERIABANK located at 1101 East Admiral Doyle Drive, New Iberia,
Louisiana, on Wednesday, April 15, 1998 at 3:00 p.m., Central Time, for the
following purposes, all of which are more completely set forth in the
accompanying Proxy Statement:
(1) To elect three directors for a three-year term expiring in 2001,
and until their successors are elected and qualified;
(2) To ratify the appointment by the Board of Directors of Castaing,
Hussey & Lolan, L.L.P. as the Company's independent auditors for the fiscal year
ending December 31, 1998; and
(3) To transact such other business as may properly come before the
meeting or any adjournment thereof.
The Board of Directors has fixed March 6, 1998 as the voting record
date for the determination of stockholders entitled to notice of and to vote at
the Annual Meeting and at any adjournment thereof. Only those stockholders of
record as of the close of business on that date will be entitled to vote at the
Annual Meeting or at any such adjournment.
BY ORDER OF THE BOARD OF DIRECTORS
Henry J. Dauterive, Jr.
Chairman of the Board
New Iberia, Louisiana
March 18, 1998
- --------------------------------------------------------------------------------
YOU ARE CORDIALLY INVITED TO ATTEND THE ANNUAL MEETING. IT IS IMPORTANT THAT
YOUR SHARES BE REPRESENTED REGARDLESS OF THE NUMBER YOU OWN. EVEN IF YOU PLAN TO
BE PRESENT, YOU ARE URGED TO COMPLETE, SIGN, DATE AND RETURN THE ENCLOSED PROXY
PROMPTLY IN THE ENVELOPE PROVIDED. IF YOU ATTEND THE MEETING, YOU MAY VOTE
EITHER IN PERSON OR BY PROXY. ANY PROXY GIVEN MAY BE REVOKED BY YOU IN WRITING
OR IN PERSON AT ANY TIME PRIOR TO THE EXERCISE THEREOF.
- --------------------------------------------------------------------------------
<PAGE>
ISB FINANCIAL CORPORATION
PROXY STATEMENT
ANNUAL MEETING OF STOCKHOLDERS
April 15, 1998
This Proxy Statement is furnished to holders of common stock, $1.00 par
value per share ("Common Stock"), of ISB Financial Corporation (the "Company"),
the parent holding company of IBERIABANK (the "Bank"). Proxies are being
solicited on behalf of the Board of Directors of the Company to be used at the
Annual Meeting of Stockholders ("Annual Meeting") to be held at the main office
of the Bank located at 1101 East Admiral Doyle Drive, New Iberia, Louisiana, on
Wednesday, April 15, 1998 at 3:00 p.m., Central Time, and at any adjournment
thereof for the purposes set forth in the Notice of Annual Meeting of
Stockholders. This Proxy Statement is first being mailed to stockholders on or
about March 16, 1998.
The proxy solicited hereby, if properly signed and returned to the
Company and not revoked prior to its use, will be voted in accordance with the
instructions contained therein. If no contrary instructions are given, each
proxy received will be voted for the nominees for director described herein, for
ratification of the appointment of Castaing, Hussey & Lolan, L.L.P. for fiscal
1998. The proxy solicited hereby also confers authority upon the Board of
Directors, as proxy, to exercise discretionary authority and vote in accordance
with their best judgment with respect to, among other things, matters which they
do not know, a reasonable time prior to the distribution of this Proxy
Statement, are to be presented at the Annual Meeting. Any stockholder giving a
proxy has the power to revoke it at any time before it is exercised by (i)
filing with the Secretary of the Company written notice thereof (through Guyton
H. Watkins, Secretary, ISB Financial Corporation); (ii) submitting a
duly-executed proxy bearing a later date; or (iii) appearing at the Annual
Meeting and giving the Secretary notice of his or her intention to vote in
person. Proxies solicited hereby may be exercised only at the Annual Meeting and
any adjournment thereof and will not be used for any other meeting.
VOTING
Only stockholders of record at the close of business on March 6, 1998
("Voting Record Date") will be entitled to vote at the Annual Meeting. On the
Voting Record Date, there were 6,902,028 shares of Common Stock issued and
outstanding and the Company had no other class of equity securities outstanding.
Each share of Common Stock is entitled to one vote at the Annual Meeting on all
matters properly presented at the meeting. Directors
- 2 -
<PAGE>
are elected by a plurality of the votes cast with a quorum present. Abstentions
are considered in determining the presence of a quorum but will not affect the
plurality vote required for the election of directors. The affirmative vote of a
majority of the total votes present in person and by proxy is required to ratify
the appointment of the independent auditors. Under rules of the New York Stock
Exchange, the proposal for ratification of the auditors is considered a
"discretionary" item upon which brokerage firms may vote in their discretion on
behalf of their clients if such clients have not furnished voting instructions
and, accordingly, there will be no "broker non-votes" with respect to the
ratification of independent auditors.
INFORMATION WITH RESPECT TO NOMINEES FOR DIRECTOR
AND EXECUTIVE OFFICERS
Election of Directors
The Articles of Incorporation of the Company provide that the Board of
Directors shall be divided into three classes as nearly equal in number as the
then total number of directors constituting the Board of Directors permits. The
directors shall be elected by the stockholders of the Company for staggered
terms, or until their successors are elected and qualified.
At the Annual Meeting, stockholders of the Company will be asked to
elect one class of directors, consisting of three directors, for a three-year
term expiring in 2001, and until their successors are elected and qualified.
No nominee for director is related to any other director or executive
officer of the Company by blood, marriage or adoption. Each nominee currently
serves as a director of the Company and of the Bank.
Pursuant to the Company's retirement policy which provides that no
person over the age of 70 years shall be eligible for election or re-election as
a director of the Company, four directors, Messrs. Bigler, Dauterive, Tamporello
and Watkins, will not be standing for re-election as directors, and each of
their terms will expire at the Annual Meeting. The Board of Directors has
adopted a resolution, effective as of the time of the Annual Meeting, to reduce
the size of the Board of Directors from thirteen to nine members. Pursuant to a
provision in the Bylaws providing that the Board of Directors be classified into
three classes as nearly equal in number as the then total number of directors
constituting the whole Board, Messrs. Fenstermaker and Mouton and Ms. Abell (who
normally would not be subject to reelection at this Annual Meeting) have agreed
to stand for reelection as directors for a three-year term expiring in 2001. As
a result of such action by Messrs. Fenstermaker and Mouton and Ms. Abell, the
classes of directors will continue to be as nearly equal in number as possible.
Ms. Knight has notified the Board of Directors that she
- 3 -
<PAGE>
expects to retire from the Board of Directors subsequent to the Annual Meeting.
Currently, no replacement director for Ms. Knight has been selected by the Board
of Directors.
Unless otherwise directed, each proxy executed and returned by a
stockholder will be voted for the election of the nominees for director listed
below. If any person named as a nominee should be unable or unwilling to stand
for election at the time of the Annual Meeting, the proxies will nominate and
vote for any replacement nominee or nominees recommended by the Board of
Directors. At this time, the Board of Directors knows of no reason why any of
the nominees listed below may not be able to serve as a director if elected.
The following tables present information concerning the nominees for
director of the Company, including tenure as a director.
Nominees for Director for Three-Year Terms Expiring in 2001
<TABLE>
<CAPTION>
Principal Occupation During Director
Name Age(1) the Past Five Years Since(2)
- ---------------------------------- ----------- ---------------------------------------- -------------------
<S> <C> <C> <C>
Elaine D. Abell 55 Attorney in private practice in 1993
Lafayette, Louisiana.
William H. Fenstermaker 48 President and Chief Executive 1990
Officer of C.H. Fenstermaker
and Associates, Inc., Lafayette,
Louisiana, which provides oil
and gas surveying, mapping,
municipal engineering,
environmental consulting and
computer information system
services.
Larrey G. Mouton 56 President and Chief Executive 1985
Officer of the Company and
the Bank.
</TABLE>
The Board of Directors recommends that you vote FOR election of the
nominees for director.
(Footnotes on page 6)
- 4 -
<PAGE>
DIRECTORS WHOSE TERMS ARE CONTINUING
Directors with a Term Expiring in 1999
<TABLE>
<CAPTION>
Principal Occupation During Director
Name Age(1) the Past Five Years Since(2)
- ------------------------------------ ----------- ----------------------------------------- ---------------
<S> <C> <C> <C>
Harry V. Barton, Jr. 44 Certified public accountant in 1993
private practice in Lafayette,
Louisiana.
E. Stewart Shea, III 46 Vice President of Bayou 1990
Management Services, New
Iberia, Louisiana, a provider of
contractor services to the oil
field industry; President of
Bayou Pipe Coating Company
and Vice President of Bayou
Coating, LLC, affiliates of
Bayou Management Services.
Karen L. Knight 57 Ms. Knight previously served 1996
as Chairman of the Board,
President and Chief Executive
Officer of Jefferson Bancorp,
Inc. and its subsidiary Jefferson
Savings Bank. Pursuant to the
terms of an Agreement and
Plan of Merger and
reorganization, upon the
Company's acquisition of
Jefferson Bancorp, Inc. in
October 1996, Ms. Knight was
elected as a director of the
Company.
</TABLE>
(Footnotes on next page)
- 5 -
<PAGE>
Directors with a Term Expiring in 2000
<TABLE>
Principal Occupation During Director
Name Age(1) the Past Five Years Since(2)
- ------------------------------- ----------- ----------------------------------------- -------------------
<S> <C> <C> <C>
Cecil C. Broussard 66 Self-employed investor. 1967
Ray Himel 70 Owner of Himel Motor Supply 1963
Corp., a chain of auto supply
stores located throughout
southern Louisiana; Himel
Marine, a marine dealership
located in New Iberia and
Lafayette, Louisiana; and
several Ace Hardware stores
located throughout southern
Louisiana.
Emile J. Plaisance, Jr. 70 Retired since August 1992; 1981
previously President of the
Bank.
</TABLE>
------------------
(1) As of March 6, 1998.
(2) Includes service as a director of the Bank, with the exception of Ms.
Knight who became a director of the Bank in 1997.
Committees and Meetings of the Board; Director Nominations
The Board of Directors of the Company has established an Audit
Committee and a Compensation Committee. The Board of Directors of the Company
meets on a monthly basis and may have additional special meetings. Nominations
for director of the Company are made by the full Board of Directors. During the
fiscal year ended December 31, 1997, the Board of Directors met fourteen times.
No director attended fewer than 75% of the total number of Board meetings or
committee meetings on which he served that were held during this period.
Audit Committee. The Audit Committee consists of Messrs. Barton, Jr.,
Himel and Tamporello. The Audit Committee supervises the Company's Internal
Auditor and is responsible for reviewing the performance, and overseeing the
engagement, of the
- 6 -
<PAGE>
Company's independent certified public accountants. The Audit Committee met ten
times during fiscal 1997. No member of the Audit Committee is a current or
former employee of the Company or any of its subsidiaries.
Compensation Committee. The Compensation Committee consists of Messrs.
Broussard, Fenstermaker and Shea. The Compensation Committee reviews the
compensation of the Company's executive officers. The Compensation Committee met
five times during fiscal 1997. The report of the Compensation Committee with
respect to compensation for the Chief Executive Officer and all other executive
officers for the fiscal year ended December 31, 1997 is set forth below.
In addition to the committees described above, the Bank has established
committees which include members of the Board and senior management and which
meet as required. These committees include, among others, an Audit Committee,
Budget and Planning Committee, Executive Committee, Compensation Committee,
Investment Committee, Commercial Loan Committee and Loan Committee.
Executive Officers Who Are Not Directors
Set forth below is information with respect to the principal
occupations during the last five years for the three executive officers of the
Company and the Bank who do not serve as directors.
Ronnie J. Foret, Age 47, is Senior Executive Vice President -
Commercial and Retail Division of the Bank. Prior to joining the Bank in March
1996, he served as Executive Vice President from 1994 to March 1996, and Senior
Vice President of First Commerce Corporation in New Orleans, Louisiana.
John J. Ballatin, Age 53, is Executive Vice President - Operations of
the Bank, and has served as an Executive Vice President since May 1997. Prior to
joining the Bank, Mr. Ballatin served as Executive Vice President of Operations
for Jefferson Guaranty Bank from March 1985 to April 1997.
Donald P. Lee, Age 38, is Senior Vice President - Risk Manager of the
Bank. Prior to joining the Bank, Mr. Lee served as Executive Vice President and
In-House Counsel at Royal Card Bank from May 1996 to June 1997. From March 1994
to May 1996 he served as Vice President and In-House Counsel at Bank of
Lafayette. From May 1993 to February 1994 he served as a trial consultant for
Litigation Dynamics, Inc.
Compliance with Section 16(a) of the 1934 Act
Section 16(a) of the Securities Exchange Act of 1934, as amended (the
"1934 Act"), requires the officers and directors, and persons who own more than
10% of the Company's Common Stock to file reports of ownership and changes in
ownership with the Securities
- 7 -
<PAGE>
and Exchange Commission and the National Association of Securities Dealers, Inc.
Officers, directors and greater than 10% stockholders are required by regulation
to furnish the Company with copies of all Section 16(a) forms they file. The
Company knows of no person who owns 10% or more of the Company's Common Stock.
Based solely on review of the copies of such forms furnished to the
Company, or written representations from its officers and directors, the Company
believes that during, and with respect to, 1997, the Company's officers and
directors complied in all respects with the reporting requirements promulgated
under Section 16(a) of the 1934 Act with the exception of Ronnie J. Foret, who
was late in filing a report.
- 8 -
<PAGE>
BENEFICIAL OWNERSHIP OF COMMON STOCK
BY CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
The following table includes, as of the Voting Record Date, certain
information as to the Common Stock beneficially owned by (i) the only persons or
entities, including any "group" as that term is used in Section 13(d)(3) of the
1934 Act, who or which was known to the Company to be the beneficial owner of
more than 5% of the issued and outstanding Common Stock, (ii) the directors of
the Company, (iii) certain executive officers of the Company, and (iv) all
directors and executive officers of the Company as a group.
<TABLE>
<CAPTION>
Common Stock
Beneficially Owned as of
March 6, 1998(1)
---------------------------
Name of Beneficial Owner No. %
- ------------------------------------------------- ------------ -----------
<S> <C> <C>
ISB Financial Corporation 590,069(2) 8.5%
Employee Stock Ownership Plan Trust
1101 E. Admiral Doyle Drive
New Iberia, Louisiana 70560
John Hancock Mutual Life 495,000(3) 7.2%
Insurance Company
Directors:
Elaine D. Abell 20,161(4) *
Harry V. Barton, Jr. 18,536(5) *
William R. Bigler 17,877(6) *
Cecil C. Broussard 32,416(7) *
Henry J. Dauterive, Jr. 23,014(8) *
William H. Fenstermaker 20,747(9) *
Ray Himel 18,927(10) *
Karen L. Knight 4,588 *
Larrey G. Mouton 82,183(11) 1.2%
Emile J. Plaisance, Jr. 26,143(12) *
E. Stewart Shea, III 25,353(13) *
Louis J. Tamporello, Sr. 19,027(14) *
Guyton H. Watkins 21,466(15) *
Executive officers who are not Directors:
John J. Ballatin 10,000(16) *
Ronnie J. Foret 20,729(17) *
Donald P. Lee 8,017(18) *
All directors and executive officers of the
Company and the Bank as a group (16 persons) 369,184 5.3%
</TABLE>
(Footnotes on following page)
- 9 -
<PAGE>
* Represents less than 1% of the outstanding Common Stock.
(1) For purposes of this table, pursuant to rules promulgated under the
1934 Act, an individual is considered to beneficially own shares of
Common Stock if he or she directly or indirectly has or shares (1)
voting power, which includes the power to vote or to direct the voting
of the shares; or (2) investment power, which includes the power to
dispose or direct the disposition of the shares. Unless otherwise
indicated, an individual has sole voting power and sole investment
power with respect to the indicated shares.
(2) The ISB Financial Corporation Employee Stock Ownership Plan Trust was
established pursuant to the ISB Financial Corporation Employee Stock
Ownership Plan ("ESOP") by an agreement between the Company and Messrs.
Broussard, Fenstermaker and Shea, who act as trustees of the plan
("Trustees"). As of the Voting Record Date, 197,956 shares held in the
ESOP Trust had been allocated to the accounts of participating
employees. Under the terms of the ESOP, the Trustees must vote all
allocated shares held in the ESOP in accordance with the instructions
of the participating employees, and allocated shares for which
employees do not give instructions, and unallocated shares, will be
voted in the same ratio on any matter as to those shares for which
instructions are given. The amount of Common Stock beneficially owned
by each individual trustee or all directors and executive officers as a
group does not include the unallocated shares held by the ESOP Trust.
(3) Pursuant to a Schedule 13G, dated January 28, 1998, John Hancock
Advisers, Inc., a registered investment adviser and subsidiary of John
Hancock Mutual Life Insurance Company, has sole voting and dispositive
power pursuant to advisory agreements with the following: the John
Hancock Bank and Thrift Opportunity Fund, which holds 120,000 shares of
Common Stock, the John Hancock Bank Regional Fund, which holds 350,000
shares of Common Stock, and the Southeastern Thrift and Bank Fund,
Inc., which holds 25,000 shares of Common Stock.
(4) Includes 5,084 shares held by Ms. Abell's spouse, which Ms. Abell may
be deemed to beneficially own, 6,901 shares held in the RRP, which may
be voted by her, and 2,876 shares which may be acquired upon the
exercise of stock options exercisable within sixty (60) days of the
Voting Record Date.
(5) Includes 1,770 shares held by Mr. Barton's spouse, which Mr. Barton may
be deemed to beneficially own, 1,237 shares held by Mr. Barton as
custodian for his children, 6,901 shares held in the RRP, which may be
voted by him, and 2,876 shares which may be acquired upon the exercise
of stock options exercisable within sixty (60) days of the Voting
Record Date.
(Footnotes continued on next page)
- 10 -
<PAGE>
(6) Includes 6,901 shares held in the RRP, which may be voted by him, and
2,876 shares which may be acquired upon the exercise of stock options
exercisable within sixty (60) days of the Voting Record Date.
(7) Includes a total of 406 shares held by Mr. Broussard's spouse as
custodian for his children, which Mr. Broussard may be deemed to
beneficiary own, 6,901 shares held in the RRP, which may be voted by
him, and 2,876 shares which may be acquired upon the exercise of stock
options exercisable within sixty (60) days of the Voting Record Date.
Excludes the shares held by the ESOP, of which Mr. Broussard is one of
three trustees.
(8) Includes 2,040 shares held by Mr. Dauterive's spouse, which Mr.
Dauterive may be deemed to beneficially own, 6,901 shares held in the
RRP, which may be voted by him, and 2,876 shares which may be acquired
upon the exercise of stock options exercisable within sixty (60) days
of the Voting Record Date.
(9) Includes 1,820 shares held by Mr. Fenstermaker's 401(k) retirement
plan, 6,901 shares held in the RRP, which may be voted by him, and
2,876 shares which may be acquired upon the exercise of stock options
exercisable within sixty (60) days of the Voting Record Date. Excludes
the shares held by the ESOP, of which Mr. Fenstermaker is one of
three trustees.
(10) Includes 6,901 shares held in the RRP, which may be voted by him, and
2,876 shares which may be acquired upon the exercise of stock options
exercisable within sixty (60) days of the Voting Record Date.
(11) Includes 614 shares held by Mr. Mouton's spouse, which Mr. Mouton may
be deemed to beneficially own, an estimated 6,550 shares which have
been allocated to Mr. Mouton's account in the ESOP, 10,417 shares held
in Mr. Mouton's account in the Bank's 401(k) retirement plan, 25,305
shares held in the RRP, which may be voted by him, and 26,359 shares
which may be acquired upon the exercise of stock options exercisable
within sixty (60) days of the Voting Record Date.
(12) Consists of 5,000 shares held by Mr. Plaisance's spouse, which Mr.
Plaisance may be deemed to beneficially own, 10,214 shares held by Mr.
Plaisance's 401(k) retirement plan, 6,901 shares held in the RRP, which
may be voted by him, and 2,876 shares which may be acquired upon the
exercise of stock options exercisable within sixty (60) days of the
Voting Record Date.
(13) Includes 3,000 shares held by Mr. Shea's spouse, 1,000 shares held by
Mr. Shea as custodian for his children, 6,901 shares held in the RRP,
which may be voted by him, and 2,876 shares which may be acquired upon
the exercise of stock options exercisable within sixty (60) days of the
Voting Record Date. Excludes the shares held by the ESOP, of which Mr.
Shea is one of three trustees.
(Footnotes continued on next page)
- 11 -
<PAGE>
(14) Includes 4,000 shares held by Mr. Tamporello's spouse, which Mr.
Tamporello may be deemed to beneficially own, 6,901 shares held in the
RRP, which may be voted by him, and 2,876 shares which may be acquired
upon the exercise of stock options exercisable within sixty (60) days
of the Voting Record Date.
(15) Includes 104 shares held by Mr. Watkins' spouse as her separate
paraphernal property, which Mr. Watkins may be deemed to beneficially
own, under the 1934 Act, 11,585 shares held by Mr. Watkins and his
spouse as community property, 6,901 shares held in the RRP, which may
be voted by him, and 2,876 shares which may be acquired upon the
exercise of stock options exercisable within sixty (60) days of the
Voting Record Date.
(16) Includes 10,000 shares held by the RRP, which may be voted by him.
(17) Includes 929 shares which have been allocated to Mr. Foret's account in
the Bank's 401(k) retirement plan, 750 shares held in his spouse's IRA
account, 13,958 shares held by the RRP, which may be voted by him, an
estimated 1,138 shares held for the account of Mr. Foret in the ESOP
and 3,954 shares which may be acquired upon the exercise of stock
options exercisable within sixty (60) days of the Voting Record Date.
(18) Includes 17 shares held in Mr. Lee's account in the Bank's 401(k)
retirement plan and 8,000 shares held by the RRP, which may be voted by
him.
- 12 -
<PAGE>
EXECUTIVE COMPENSATION
Summary Compensation Table
Directors and officers do not receive separate compensation directly
from the Company. All compensation is paid by the Bank. The following table sets
forth a summary of certain information concerning the compensation paid for
services rendered in all capacities during the years ended December 31, 1997,
1996 and 1995 to the President and Chief Executive Officer and the only
executive officer of the Company, and its subsidiaries whose total compensation
during the fiscal year exceeded $100,000.
<TABLE>
<CAPTION>
Annual Compensation Long Term Compensation
----------------------------------------------------------------------------------------------
Other
Name and Annual Awards Payouts All Other
Principal Position Year Salary Bonus Compensation(1) Compensation
--------------------------------------
Securities
Restricted Underlying LTIP
Stock Options Payouts
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Larrey G. Mouton 1997 $200,003 $500 $-- -- -- -- $55,805(4)
President and Chief 1996 207,696 475 -- $468,677(2) 184,516 -- 46,916
Executive Officer (2) 1995 196,158 33,690 -- -- -- -- 32,540
---- -------- ------ --- ---------- ------- ---- -----------
Ronnie J. Foret 1997 $125,192 $7,810 -- $178,500(3) -- -- $ $33,997(5)
Senior Executive 1996 94,615 165 -- 128,873(3) 27,677 -- --
Vice President
---- -------- ------ --- ---------- ------- ---- -----------
---- -------- ------ --- ---------- ------- ---- -----------
</TABLE>
- ---------------
(1) Does not include amounts attributable to miscellaneous benefits
received by the named executive officer. In the opinion of management
of the Bank, the costs to the Bank of providing such benefits to the
named executive officer during the individual periods did not exceed
the lesser of $50,000 or 10% of the total of annual salary and bonus
reported for the individual.
(2) Represents the grant of 29,523 shares of restricted Common Stock in
1996 pursuant to the RRP, which had a fair market value of $881,999 at
December 31, 1997. The restricted stock awarded vests over seven years,
14.29% per year from the date of grant.
(3) Represents the grant of 8,118 and 7,000 shares of restricted Common
Stock in 1996 and 1997, respectively, pursuant to the RRP, which had a
fair market value of $451,650 at December 31, 1997. The restricted
stock award vests over seven years, 14.29% per year from the date of
grant.
(4) Represents the fair market value of the estimated 1,868 shares of
Common Stock allocated to Mr. Mouton's account in 1997 pursuant to the
Company's ESOP.
(5) Represents the fair market value of the estimated 1,138 shares of
Common Stock allocated to Mr. Foret's account in 1997 pursuant to the
Company's ESOP.
- 13 -
<PAGE>
Stock Options
The following table sets forth certain information concerning exercises
of stock options by the named executive officers during the year ended December
31, 1997 and the value of stock options held at December 31, 1997.
AGGREGATED OPTION EXERCISES IN LAST FISCAL YEAR
AND YEAR END OPTION VALUES
<TABLE>
<CAPTION>
Number of Value of
Shares Unexercised Unexercised
Acquired on Value Options at Year End Options at
Name Exercise Realized Year End(1)
------------------------------------------------------------------------------
Exercisable Unexercisable Exercisable Unexercisable
- ------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Larrey G. Mouton -- $-- 26,359 158,157 $369,026 $2,214,198
---- ----- ------ ------- -------- ----------
Ronnie J. Foret -- $-- 3,954 23,723 $55,356 $332,122
---- ----- ------ ------- -------- ----------
---- ----- ------ ------- -------- ----------
</TABLE>
(1) Based on an assumed market price of $29.875 per share of Common Stock
at December 31, 1997.
Director's Compensation
During 1997, members of the Board of Directors of the Bank received
fees of $2,000 per month for their services as directors of the Bank, except for
the Chairman, who received fees of $2,300 per month, and Mr. Mouton, who was not
compensated for such service. Members of the Board of Directors receive no
additional compensation for their participation in any of the Committees or for
services as directors of the Company.
Employment and Severance Agreements
The Company and the Bank (collectively the "Employers") in February
1995 entered into a three-year employment agreement with Mr. Mouton which, in
February 1998, was extended for one year by the parties at an salary of
$200,000. On or before each anniversary of the date of commencement of the
agreement, the term of employment shall automatically be extended for an
additional one-year period beyond the then effective expiration date unless
written notice from the Employers or the Executive is received not less than 30
days prior to an anniversary date advising the other party that the agreement
shall not be further extended. The agreement is terminable with or without cause
by the Employers. The officer shall have no right to compensation or other
benefits pursuant to the employment agreement for any period after voluntary
termination or termination by the Employers for cause, disability or retirement,
provided, however, that (i) in the event that the officer terminates his
employment because of failure of the Employers to comply with any material
provision of the employment agreement he shall be entitled to severance payments
equal to the greater of the amount of his base salary for the remaining term of
- 14 -
<PAGE>
the agreement is terminated by the Employers other than for cause, disability,
retirement or death or by the officer as a result of certain adverse actions
which are taken with respect to the officer's employment following a Change in
Control of the Company, as defined, Mr. Mouton will be entitled to cash
severance payments equal to the greater of the amount of his base salary for the
remaining term of the agreement or his base salary at the date of termination
multiplied by 2.0. In addition, Mr. Mouton will be entitled to a continuation of
benefits similar to those he is receiving at the time of such termination for
the period otherwise remaining under the term of the agreement or until he
obtains full-time employment with another employer, whichever occurs first. A
Change in Control is generally defined in the employment agreement to include
any change in control required to be reported under the federal securities laws,
as well as the acquisition by any person of 25% or more of the Company's
outstanding voting securities. Mr. Mouton's employment agreement provides that
in the event that any payments to be paid thereunder are deemed to constitute
"excess parachute payments" and, therefore, subject to an excise tax under
Section 4999 of the Code, the Employers may (i) contest the liability and
exhaust all administrative and judicial appeals to that end, and/or (ii) pay Mr.
Mouton an amount equal to the excise tax for which he is liable plus an amount
equal to any additional federal, state, or local taxes that may result because
of such additional payment. Mr. Mouton's agreement also provides that in the
event of Mr. Mouton's death during the term of the agreement, his estate will
receive payments equal to the amount of compensation for 12 months at his
current salary at the time of his death.
The Employers have also entered into severance agreements with Messrs.
Ronnie J. Foret, John J. Ballatin and Donald P. Lee. Under the terms of such
severance agreements, the Employers have agreed that in the event that such
officer's employment is terminated as a result of certain adverse actions which
are taken with respect to the officer's employment following a Change in Control
of the Company, as defined, such officer will be entitled to a cash severance
amount equal to his base salary multiplied by 2.0.
Although the above-described employment and severance agreements could
increase the cost of any acquisition of control of the Company, management of
the Company does not believe that the terms thereof would have a significant
anti-takeover effect.
Transactions With Certain Related Persons
The Bank's policy provides that all loans made by the Bank to its
directors and officers are made in the ordinary course of business, are made on
substantially the same terms, including interest rates and collateral, as those
prevailing at the time for comparable transactions with other persons and do not
involve more than the normal risk of collectibility or present other unfavorable
features. As of December 31, 1997, two of the Bank's directors and executive
officers had aggregate loan balances in excess of $60,000, which amounted to
$429,894 in the aggregate, or approximately 0.4% of the Company's equity as of
such date. All such loans were made by the Bank in the ordinary course of
business and were not made
- 15 -
<PAGE>
with favorable terms nor did they involve more than the normal risk of
collectibility. As of December 31, 1997, all such loans were current.
The firm of Landry & Watkins is general counsel to the Bank. Guyton H.
Watkins, a director and Secretary of the Bank, is of counsel to Landry &
Watkins. Karen L. Knight, a director of the Company, receives compensation for
certain consulting services provided to the Company.
Report of the Compensation Committee
The goals of the Committee are to assist the Bank in attracting and
retaining qualified management, motivating executives to achieve performance
goals, rewarding management for outstanding performance and to ensure that the
financial interests of the Company's management and shareholders are satisfied.
During 1997, Mr. Mouton's base salary was $200,000 and was determined
on an arms'-length basis in 1995 when the Company and the Bank entered into an
employment agreement with Mr. Mouton. In determining Mr. Mouton's base salary,
the compensation considered the above-referenced factors, including the
compensation analyses prepared by the referenced third parties. Under the terms
of his employment agreement, Mr. Mouton's salary may be increased, but not
decreased, by the Board of Directors and Mr. Mouton may receive bonuses, when,
as, and if determined in the sole discretion of the Board of Directors. The
Committee also considers the factors described in the immediately preceding
paragraph in establishing compensation for the other executive officers of the
Bank. During 1997, Executive officers of the Bank, except for Mr. Mouton, also
were eligible to participate in the Bank's bonus plan provided that certain
pre-determined performance criteria are satisfied. In determining the awards
granted to Mr. Mouton and the Bank's other executive officers under the Option
Plan and Recognition Plan, the Committee considered the contributions made by
such officer to the Company and the Bank and such officer's responsibilities.
The awards granted under the Option Plan and Recognition Plan were also designed
to provide an incentive to executive officers to contribute to the Company's
continued success in the future.
The Committee considered several financial and non-financial
accomplishments in setting the compensation of the Chief Executive Officer and
other executive officers, including but not limited to, net income of the Bank,
profitability ratios, satisfactory regulatory examinations, and market value of
the Bank. In addition, other objectives such as growth and the successful stock
conversion and reorganization were reviewed. The committee reviewed and
considered the SNL Executive Compensation Review for a comparison of
compensation paid by the Bank's peer group.
- 16 -
<PAGE>
Following review and approval by the Committee, all issues pertaining
to executive compensation are submitted to the full Board of Directors for their
approval.
Cecil C. Broussard
William H. Fenstermaker
E. Stewart Shea, III
Performance Graph
The following graph compares the cumulative total return on the Common
Stock over a measurement period since the Company's initial issuance of Common
Stock in April 1995 with (i) the cumulative total return on the stocks included
in the National Association of Securities Dealers, Inc. Automated Quotation
("NASDAQ") Total Return Index (for United States companies) and (ii) the
cumulative total return on the stocks included in the SNL Peer Group Index. All
of these cumulative returns are computed assuming the reinvestment of dividends
which were paid during the applicable time period.
[GRAPH]
<TABLE>
<CAPTION>
Period Ending
------------------------------------------------------------------------------------------
Index 4/7/95 6/30/95 12/31/95 6/30/96 12/31/96 6/30/97 12/31/97
- ----- --------- ---------- -------- -------- -------- -------- --------
<S> <C> <C> <C> <C> <C> <C> <C>
ISB Financial Corporation 100.00 116.52 117.64 116.28 144.13 209.85 243.28
NASDAQ - Total US 100.00 114.86 130.26 147.47 160.22 179.31 196.61
SNL $500M-$1B Thrift Index 100.00 109.55 127.81 133.44 158.49 200.43 267.72
SNL $500M-$1B Bank Index 100.00 105.30 126.91 134.67 158.66 193.26 257.91
</TABLE>
- 17 -
<PAGE>
RATIFICATION OF APPOINTMENT OF AUDITORS
The Board of Directors of the Company has appointed Castaing, Hussey &
Lolan, L.L.P., independent certified public accountants, to perform the audit of
the Company's financial statements for the year ending December 31, 1998, and
further directed that the selection of auditors be submitted for ratification by
the stockholders at the Annual Meeting.
The Company has been advised by Castaing, Hussey & Lolan, L.L.P. that
neither that firm nor any of its associates has any relationship with the
Company or its subsidiaries other than the usual relationship that exists
between independent certified public accountants and clients. Castaing, Hussey &
Lolan, L.L.P. will have one or more representatives at the Annual Meeting who
will have an opportunity to make a statement, if they so desire, and will be
available to respond to appropriate questions.
The Board of Directors recommends that you vote FOR the ratification of
the appointment of Castaing, Hussey & Lolan, L.L.P. as independent auditors for
the fiscal year ending December 31, 1998.
STOCKHOLDER PROPOSALS
Any proposal which a stockholder wishes to have included in the proxy
materials of the Company relating to the next annual meeting of stockholders of
the Company, which is scheduled to be held in April 1999, must be received at
the principal executive offices of the Company, 1101 E. Admiral Doyle Drive, New
Iberia, Louisiana, Attention: Guyton H. Watkins, Secretary, no later than
November 16, 1998. If such proposal is in compliance with all of the
requirements of Rule 14a-8 under the 1934 Act, it will be included in the proxy
statement and set forth on the form of proxy issued for such annual meeting of
stockholders. It is urged that any such proposals be sent certified mail, return
receipt requested.
Stockholder proposals which are not submitted for inclusion in the
Company's proxy materials pursuant to Rule 14a-8 under the 1934 Act may be
brought before an annual meeting pursuant to Article 9.B. of the Company's
Articles of Incorporation.
ANNUAL REPORTS
A copy of the Company's Annual Report to Stockholders for the year
ended December 31, 1997 accompanies this Proxy Statement. Such annual report is
not part of the proxy solicitation materials.
- 18 -
<PAGE>
OTHER MATTERS
Management is not aware of any business to come before the Annual
Meeting other than the matters described above in this Proxy Statement. However,
if any matters should properly come before the meeting other than those which
are described in this Proxy Statement, it is intended that the proxies solicited
hereby will be voted with respect to those other matters in accordance with the
judgment of the persons voting the proxies.
- 19 -
<PAGE>
REVOCABLE PROXY
ISB FINANCIAL CORPORATION
ANNUAL MEETING OF STOCKHOLDERS
April 15, 1998
The undersigned, being a stockholder of ISB Financial Corporation
("Company") as of March 6, 1998, hereby authorizes the Board of Directors of the
Company or any successors thereto as proxies with full powers of substitution,
to represent the undersigned at the Annual Meeting of Stockholders of the
Company to be held at the main office of IBERIABANK, located at 1101 East
Admiral Doyle Drive, New Iberia, Louisiana, on Wednesday, April 15, 1998 at 3:00
p.m., Central Time, and at any adjournment of said meeting, and thereat to act
with respect to all votes that the undersigned would be entitled to cast, if
then personally present, as follows:
1. ELECTION OF DIRECTORS
Nominees for a three-year term: Elaine D. Abell, William H. Fenstermaker and
Larrey G. Mouton.
/ / FOR / / WITHHOLD
AUTHORITY
NOTE: To withhold authority to vote for an individual nominee,
strike a line through that nominee's name. Unless authority
to vote for all of the foregoing nominees is withheld, this
Proxy will be deemed to confer authority to vote for each
nominee whose name is not struck.
2. PROPOSAL to ratify the appointment by the Board of Directors of Castaing,
Hussey & Lolan, L.L.P. as the Company's independent auditors for the fiscal
year ending December 31, 1998.
/ / FOR / / AGAINST / / ABSTAIN
<PAGE>
3. In their discretion, the proxies are authorized to vote upon such other
business as may properly come before the meeting.
SHARES OF THE COMPANY'S COMMON STOCK WILL BE VOTED AS SPECIFIED. IF
RETURNED BUT NOT OTHERWISE SPECIFIED, THIS PROXY WILL BE VOTED FOR THE ELECTION
OF THE BOARD OF DIRECTORS' NOMINEES TO THE BOARD OF DIRECTORS, FOR RATIFICATION
OF THE COMPANY'S INDEPENDENT AUDITORS, AND OTHERWISE AT THE DISCRETION OF THE
PROXIES. YOU MAY REVOKE THIS PROXY AT ANY TIME PRIOR TO THE TIME IT IS VOTED AT
THE ANNUAL MEETING.
Please be sure to sign and date this Proxy
in the box below.
[Date and Signature box]
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS OF THE COMPANY
FOR USE AT THE ANNUAL MEETING OF STOCKHOLDERS TO BE HELD ON APRIL 15, 1998 AND
AT ANY ADJOURNMENT THEREOF.
PLEASE SIGN THIS EXACTLY AS YOUR NAME(S) APPEAR(S) ON THIS PROXY. WHEN
SIGNING IN A REPRESENTATIVE CAPACITY, PLEASE GIVE FULL TITLE. WHEN SHARES ARE
HELD JOINTLY, ONLY ONE HOLDER NEED SIGN.
PLEASE MARK, SIGN, DATE AND RETURN THE PROXY PROMPTLY USING THE ENCLOSED
ENVELOPE.
<PAGE>
ESOP VOTING INSTRUCTION BALLOT
ISB FINANCIAL CORPORATION
The undersigned hereby instructs the Trustees of the Employee Stock
Ownership Plan ("ESOP") of ISB Financial Corporation (the "Company") to vote,
as designated below, all the shares of Common Stock of the Company allocated
to my account pursuant to the ESOP as of March 6, 1998 at the Annual Meeting
of Shareholders to be held at the main office of IBERIABANK located at 1101
East Admiral Doyle Drive, New Iberia, Louisiana, on Wednesday, April 15,
1998, at 3:00 p.m., Central Time, and any adjournment thereof.
1. ELECTION OF DIRECTORS FOR THREE-YEAR TERM
/ / FOR all nominees listed below / / WITHHOLD AUTHORITY
(except as marked to the to vote for all
contrary below) nominees listed
below
Nominees for three-year term expiring in 2001: Elaine D. Abell, William H.
Fenstermaker and Larrey G. Mouton.
(Instruction: To withhold authority to vote for any individual nominee, write
that nominee's name in the space provided below.)
- ---------------------------------------------
2. PROPOSAL TO RATIFY THE APPOINTMENT by the Board of Directors of
Castaing, Hussey & Lolan, L.L.P. as the Company's independent auditors for
the fiscal year ending December 31, 1998.
/ / FOR / / AGAINST / / ABSTAIN
3. In its discretion, the Trustee is authorized to vote upon such other
business as may properly come before the meeting.
The Company's Board of Directors recommends a vote FOR the Board's
nominees for director and FOR Proposal 2. Such votes are hereby solicited by
the Company's Board of Directors.
Dated:__________________ , 1998
_________________________
Signature
IF YOU RETURN THIS CARD PROPERLY SIGNED BUT YOU DO NOT OTHERWISE SPECIFY,
SHARES WILL BE VOTED FOR THE BOARD OF DIRECTOR'S NOMINEES FOR DIRECTOR AND
FOR PROPOSAL 2. IF YOU DO NOT RETURN THIS CARD, YOUR SHARES WILL BE VOTED BY
THE TRUSTEES IN THE SAME PROPORTION AS ALL ALLOCATED SHARES UNDER THE ESOP
ARE VOTED.
<PAGE>
[ISB LETTERHEAD]
March 18, 1998
To: Participants in the Company's Employee Stock Ownership Plan
As described in the attached materials, proxies are being solicited in
connection with the proposals to be considered at the upcoming Annual Meeting
of Shareholders of ISB Financial Corporation (the "Company"). We hope you
will take advantage of the opportunity to direct the manner in which shares
of Common Stock of the Company allocated to your account pursuant to the
Company's Employee Stock Ownership Plan ("ESOP") will be voted.
Enclosed with this letter is the Proxy Statement, which describes the
matters to be voted upon, and a voting instruction ballot, which will permit
you to vote the shares in your account. After you have reviewed the Proxy
Statement, we urge you to vote your restricted shares held pursuant to the
ESOP by marking, dating, signing and returning the enclosed voting
instruction ballot to the administrators of the ESOP. The Plan
Administrators will certify the totals to the ESOP Trustees for the purpose
of having those shares voted by the Trustees.
We urge each of you to vote, as a means of participating in the
governance of the affairs of the Company. If your voting instructions for the
ESOP are not received, the shares allocated to your account will be voted in
the same proportion as all allocated shares under the ESOP are voted. While
I hope that you will vote in the manner recommended by the Board of
Directors, the most important thing is that you vote in whatever manner you
deem appropriate. Please take a moment to do so.
Please note that the enclosed material relates only to those shares
which have been allocated to you under the ESOP. You will receive other
voting material for those shares owned by you individually and not under the
ESOP.
Sincerely,
Larrey G. Mouton
President and Chief Executive Officer
<PAGE>
RECOGNITION PLAN VOTING INSTRUCTION BALLOT
ISB FINANCIAL CORPORATION
The undersigned hereby instructs the Trustee of the Recognition and
Retention Plan and Trust ("Recognition Plan") of ISB Financial Corporation
(the "Company") to vote, as designated below, all the shares of Common Stock
of the Company granted pursuant to the Recognition Plan to the undersigned as
of March 6, 1998 at the Annual Meeting of Shareholders to be held at the main
office of IBERIABANK located at 1101 East Admiral Doyle Drive, New Iberia,
Louisiana, on Wednesday, April 15, 1998, at 3:00 p.m., Central Time, and any
adjournment thereof.
1. ELECTION OF DIRECTORS FOR THREE-YEAR TERM
/ / FOR all nominees listed below / / WITHHOLD AUTHORITY
(except as marked to the to vote for all
contrary below) nominees listed
below
Nominees for three-year term expiring in 2001:
Elaine D. Abell, William H. Fenstermaker and Larrey G. Menton.
(Instruction: To withhold authority to vote for any individual nominee, write
that nominee's name in the space provided below.)
- ---------------------------------------------
2. PROPOSAL TO RATIFY THE APPOINTMENT by the Board of Directors of
Castaing, Hussey & Lolan, L.L.P. as the Company's independent auditors for
the year ending December 31, 1998.
/ / FOR / / AGAINST / / ABSTAIN
3. In its discretion, the Trustee is authorized to vote upon such other
business as may properly come before the meeting.
The Company's Board of Directors recommends a vote FOR the Board's
nominees for director and FOR Proposal 2. Such votes are hereby solicited by
the Company's Board of Directors.
Dated:__________________ , 1998
_________________________
Signature
IF YOU RETURN THIS CARD PROPERLY SIGNED BUT YOU DO NOT OTHERWISE SPECIFY,
SHARES WILL BE VOTED FOR THE BOARD OF DIRECTORS' NOMINEES FOR DIRECTOR AND
FOR PROPOSAL 2. IF YOU DO NOT RETURN THIS CARD, YOUR SHARES WILL NOT BE
VOTED.
<PAGE>
[ISB LETTERHEAD]
March 18, 1998
To: Persons Granted Restricted Stock Under the Company's Recognition and
Retention Plan
As described in the attached materials, proxies are being solicited in
connection with the proposals to be considered at the upcoming Annual Meeting
of Shareholders of ISB Financial Corporation (the "Company"). We hope you
will take advantage of the opportunity to direct the manner in which shares
of restricted Common Stock of the Company granted to you pursuant to the
Recognition and Retention Plan and Trust ("Recognition Plan") will be voted.
Enclosed with this letter is the Proxy Statement, which describes the
matters to be voted upon, and a voting instruction ballot, which will permit
you to vote the restricted shares granted to you. After you have reviewed
the Proxy Statement, we urge you to vote your restricted shares held pursuant
to the Recognition Plan by marking, dating, signing and returning the
enclosed voting instruction ballot to the administrators of the Recognition
Plan. The Plan Administrators will certify the totals to the Trustee of the
Recognition Plan for the purpose of having those shares voted by the Trustee.
We urge each of you to vote, as a means of participating in the
governance of the affairs of the Company. If your voting instructions for the
shares held in the Recognition Plan are not received, the shares will not be
voted. While I hope that you will vote in the manner recommended by the
Board of Directors, the most important thing is that you vote in whatever
manner you deem appropriate. Please take a moment to do so.
Please note that the enclosed material relates only to those shares
which have been granted to you under the Recognition Plan. You will receive
other voting material for those shares owned by you individually and not
under the Recognition Plan.
Sincerely,
Larrey G. Mouton
President and Chief Executive Officer
<PAGE>
401(k) PLAN VOTING INSTRUCTION BALLOT
ISB FINANCIAL CORPORATION
The undersigned hereby instructs the Trustee of the 401(k) Profit
Sharing Plan (the "401(k) Plan") of ISB Financial Corporation (the "Company")
to vote, as designated below, all the shares of Common Stock of the Company
allocated to my account pursuant to the 401(k) Plan as of March 6, 1998 at
the Annual Meeting of Stockholders to be held at the main office of
IBERIABANK located at 1101 East Admiral Doyle Drive, New Iberia, Louisiana,
on Wednesday, April 15, 1998, at 3:00 p.m., Central Time, and any adjournment
thereof.
1. ELECTION OF DIRECTORS
/ / FOR all nominees listed / / WITHHOLD AUTHORITY
below (except as marked to vote for all
to the contrary below) nominees listed
below
Nominees for three-year term expiring in 2001: Elaine D. Abell,
William H. Fenstermaker and Larrey G. Mouton.
(Instruction: To withhold authority to vote for any individual nominee, write
that nominee's name in the space provided below.)
_____________________________________________________________
2. PROPOSAL TO RATIFY THE APPOINTMENT by the Board of Directors of
Castaing, Hussey & Lolan, L.L.P. as the Company's independent auditors for
the fiscal year ending December 31, 1998.
/ / FOR / / AGAINST / / ABSTAIN
3. In its discretion, the Trustee is authorized to vote upon such other
business as may properly come before the meeting.
The Company's Board of Directors recommends a vote FOR the Board's
nominees for director and FOR proposal 2. Such votes are hereby solicited by
the Company's Board of Directors.
Dated: __________________, 1998
_____________________________________
Signature
If you return this card properly signed but you do not otherwise specify,
shares will be voted for the Board of Director's nominees for director and
for Proposal 2. If you do not return this Card, your shares will be voted by
the Trustees in the same proportion as all allocated shares under the 401(k)
Plan are voted.
<PAGE>
March 18, 1998
To: Participants in the ISB 401(k) Profit Sharing Plan
As described in the attached materials, your proxy as a stockholder of
the ISB Financial Corporation (the "Company") is being solicited in
connection with the proposals to be considered at the Company's upcoming
Annual Meeting of Stockholders. We hope you will take advantage of the
opportunity to direct the manner in which shares of Common Stock of the
Company allocated to your account under the 401(k) Profit Sharing Plan (the
"401(k) Plan") will be voted.
Enclosed with this letter is the Proxy Statement, which describes the
matters to be voted upon, a voting instruction ballot, which will permit you
to vote the shares allocated to your account, and a return envelope. After
you have reviewed the Proxy Statement, we urge you to vote your shares held
pursuant to the 401(k) Plan by marking, dating, signing and returning the
enclosed voting instruction ballot to the plan administrators in the
accompanying envelope.
We urge each of you to vote, as a means of participating in the
governance of the affairs of the Company. If your voting instructions for
the 401(k) Plan are not received, the shares allocated to your account
pursuant to this plan will not be voted. While I hope that you will vote in
the manner recommended by the Board of Directors, the most important thing is
that you vote in whatever manner you deem appropriate. Please take a moment
to do so.
Please note that the enclosed material relates only to those shares
which have been allocated to your account under the 401(k) Plan. You will
receive other voting material for those shares owned by you individually and
not under the 401(k) Plan.
Sincerely,
Larrey G. Mouton
President and Chief Executive Officer
