<PAGE> 1
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14a-101 of the
Securities Exchange Act of 1934
(Amendment No. )
Filed by the Registrant [ ]
Filed by a party other than the Registrant [X]
Check the appropriate box:
[ ] Preliminary Proxy Statement
[X] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting material pursuant to RULE 14a-11(c) or Rule 14a-12
Washington Federal, Inc.
- --------------------------------------------------------------------------------
(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 filing fee required.
[ ] $125 per Exchange Act Rule 0-11(c)(1)(ii), 14a-6(i)(1), or 14a-6(j)(2).
[ ] $500 per each party to the controversy pursuant to Exchange Act Rule
14a-6(i)(3).
[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and 0-11.
(1) Title of each class of securities to which transaction applies:
---------------------------------------------------------------------
(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:(1)
---------------------------------------------------------------------
(4) Proposed maximum aggregate value of transaction:
---------------------------------------------------------------------
(1) (Set forth the amount on which the filing fee is calculated and
state how it was determined.
<PAGE> 2
Washington Federal, Inc. logo
425 PIKE STREET
SEATTLE, WA 98101-2334
(206) 624-7930
December 20, 1996
Dear Stockholder:
You are invited to attend our Annual Meeting of Stockholders to be held on
January 23, 1997 at 2:00 p.m. at the Seattle Sheraton Hotel, 1400 Sixth Avenue,
Seattle, Washington.
We hope you can attend this meeting in person, but whether or not you plan
to attend, it would be very helpful if you would sign the enclosed proxy card
and return it in the envelope provided. Please do this immediately so that we
can SAVE YOUR COMPANY THE TIME AND EXPENSE OF CONTACTING YOU AGAIN. Your vote is
important regardless of the number of shares you own. Voting by proxy will not
prevent you from voting in person if you attend the meeting, but will ensure
that your vote will be counted if you are unable to attend.
If you have any questions, please do not hesitate to contact us.
Sincerely,
/s/ GUY C. PINKERTON
--------------------------
Guy C. Pinkerton
Chairman, President and
Chief Executive Officer
<PAGE> 3
Washington Federal, Inc. Logo
425 PIKE STREET
SEATTLE, WA 98101-2334
(206) 624-7930
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD ON JANUARY 23, 1997
NOTICE IS HEREBY GIVEN that an annual meeting of stockholders of Washington
Federal, Inc. ("Washington Federal") will be held at the Seattle Sheraton Hotel,
1400 Sixth Avenue, Seattle, Washington, on January 23, 1997, at 2:00 p.m.,
Pacific Time, for the following purposes:
1. To elect three directors for a three-year term and until their
successors are elected and qualified;
2. To ratify the appointment of Deloitte & Touche LLP as Washington
Federal's independent public accountants for fiscal 1997; and
3. To transact such other business as may properly come before the
meeting or any adjournment thereof.
The Board of Directors of Washington Federal has fixed December 9, 1996 as
the record date for the determination of stockholders entitled to notice of and
to vote at the Annual Meeting. Only those stockholders of record as of the close
of business on that date will be entitled to vote at the Annual Meeting or at
any such adjournment.
By Order of the Board of
Directors
/s/ CHARLES R. RICHMOND
------------------------
Charles R. Richmond
Secretary
December 20, 1996
Seattle, Washington
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 THIS MEETING, YOU MAY VOTE
EITHER IN PERSON OR BY YOUR PROXY. ANY PROXY GIVEN MAY BE REVOKED BY YOU IN
WRITING OR IN PERSON AT ANY TIME PRIOR TO THE EXERCISE THEREOF.
<PAGE> 4
WASHINGTON FEDERAL, INC.
PROXY STATEMENT
ANNUAL MEETING OF STOCKHOLDERS
JANUARY 23, 1997
This Proxy Statement is furnished to the holders of the common stock, $1.00
par value per share ("Common Stock"), of Washington Federal, Inc. ("Washington
Federal" or the "Company"), the parent holding company for Washington Federal
Savings, a federally-chartered savings association, in connection with the
solicitation of proxies by the Board of Directors of the Company, to be used at
the Annual Meeting of Stockholders to be held at the Seattle Sheraton Hotel,
1400 Sixth Avenue, Seattle, Washington, on Thursday, January 23, 1997, at 2:00
p.m., and at any adjournment thereof (the "Annual Meeting"), 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 December 20, 1996.
The proxy solicited hereby, if properly signed and returned and not revoked
prior to its use, will be voted in accordance with the instructions given
thereon. If no instructions are so specified, the proxy will be voted for the
persons nominated to be directors by the Board of Directors, for the
ratification of the appointment of Deloitte & Touche LLP as independent auditors
for fiscal 1997 and, upon the transaction of such other business as may properly
come before the Annual Meeting, in accordance with the best judgment of the
persons appointed as proxies. Any stockholder giving a proxy has the power to
revoke it at any time before it is exercised by (i) filing written notice
thereof with the Secretary of Washington Federal (Charles R. Richmond,
Washington Federal, Inc., 425 Pike Street, Seattle, Washington 98101); (ii)
submitting a duly executed proxy bearing a later date; or (iii) appearing at the
meeting and notifying the Secretary 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 SECURITIES AND PRINCIPAL HOLDERS THEREOF
VOTING SECURITIES
Only stockholders of record at the close of business on December 9, 1996
("Voting Record Date") will be entitled to vote at the Annual Meeting. On the
Voting Record Date, 43,129,977 shares of Common Stock were issued and
outstanding and the Company had no other class of equity securities issued and
outstanding.
<PAGE> 5
Each share of Common Stock is entitled to one vote at the Annual Meeting on
matters other than the election of directors, in respect of which cumulative
voting is permitted, as discussed below under "Information with Respect to
Nominees for Director, Directors Whose Terms Continue and Executive Officers."
VOTE REQUIRED
The election of the Company's Directors requires a plurality of the votes
represented in person or by proxy at the Annual Meeting, and the other proposal
described in the accompanying Notice to Stockholders and any other business
which may properly come before the Annual Meeting require that the votes cast in
favor exceed the votes cast against the proposal.
EFFECT OF AN ABSTENTION AND BROKER NON-VOTES
A stockholder who abstains from voting on any or all proposals will be
included in the number of stockholders present at the Annual Meeting for the
purpose of determining the presence of a quorum. Abstentions will not be counted
either in favor of or against the election of the nominees or any other
proposal. Under the rules of the National Association of Securities Dealers,
brokers holding stock for the accounts of their clients who have not been given
specific voting instructions as to a matter by their clients may vote their
clients' proxies in their own discretion.
PRINCIPAL HOLDERS OF VOTING SECURITIES
The following table sets forth information as of October 1, 1996 with
respect to (i) any person or entity known by Washington Federal to be the
beneficial owner of more than 5% of the issued and outstanding Common Stock and
(ii) ownership of the Common Stock by all directors and executive officers of
Washington Federal as a group.
<TABLE>
<CAPTION>
AMOUNT AND NATURE OF
NAME AND ADDRESS OF BENEFICIAL OWNER BENEFICIAL OWNERSHIP(1) PERCENT OF CLASS
- -------------------------------------- ----------------------- ----------------
<S> <C> <C>
Sirach Capital Management, Inc........ 2,534,079(2) 6.23%
3323 One Union Square
Seattle, Washington 98101
All directors and executive officers 1,313,485(3) 3.22%(4)
as a group (14 persons).............
</TABLE>
- ------------------------------
(1) Pursuant to rules promulgated by the Securities and Exchange Commission
("SEC") under the Securities Exchange Act of 1934, as amended ("Exchange
Act"), a person is considered to beneficially own shares of Common Stock if
he
2
<PAGE> 6
or she has or shares: (1) voting power, which includes the power to vote, or
direct the voting of the shares; or (2) investment power, which includes the
power to dispose, or direct the disposition of the shares.
(2) Based on a Schedule 13G filed pursuant to the Exchange Act, Sirach Capital
Management, Inc. has sole voting and dispositive power with respect to the
indicated shares.
(3) Includes ownership of options to purchase Common Stock that may be exercised
by all executive officers as a group prior to December 31, 1996 aggregating
92,427 shares. Also includes 1,238,977 shares held by the Washington Federal
Savings Retirement Plan ("Retirement Plan") for the benefit of executive
officers and former executive officers who serve as directors of Washington
Federal. The Retirement Plan is a qualified, defined contribution profit
sharing plan maintained for all eligible employees of Washington Federal and
which invests primarily in U.S. Government and federal agency securities,
certificates of deposit and similar instruments issued by Washington Federal
and other financial institutions. The shares of Common Stock of Washington
Federal held by the Retirement Plan are voted by the trustees of such plan,
but their disposition can only be directed by the employee to whose account
the shares are allocated. The trustees of the Retirement Plan are Karen C.
Carlson, Arline T. Fonda and Ronald L. Saper, all of whom are full or
part-time employees of Washington Federal Savings.
(4) The percentage of outstanding shares of Common Stock is based on the
40,695,450 shares of Common Stock issued and outstanding on October 1, 1996,
plus options to purchase 92,427 shares of Common Stock which are exercisable
by executive officers as a group prior to December 31, 1996.
INFORMATION WITH RESPECT TO NOMINEES FOR DIRECTOR,
DIRECTORS WHOSE TERMS CONTINUE AND EXECUTIVE OFFICERS
GENERAL
The Restated Articles of Incorporation of Washington Federal provide that
the Board of Directors shall be divided into three classes as nearly equal in
number as possible, and that the members of each class shall be elected for
terms of three years and until their successors are elected and qualified, with
one of the three classes of directors to be elected each year. The number of
directors currently authorized by Washington Federal's Bylaws is nine.
3
<PAGE> 7
Pursuant to Washington Federal's Restated Articles of Incorporation, at
each election of directors every stockholder entitled to vote has the right to
vote, in person or by proxy, the number of shares owned by him or her for as
many persons as there are directors to be elected, or to cumulate his or her
votes by giving one candidate as many votes as the number of such directors to
be elected multiplied by the number of his or her shares shall equal, or by
distributing such votes on the same principle among any number of candidates. In
the event that cumulative voting is in effect, it is the intention of the
persons named in the accompanying proxy to vote cumulatively for the election as
directors the nominees listed in the table below. The accompanying proxy cannot
be voted for any person who is not a nominee of the Board of Directors.
At the Annual Meeting, stockholders of Washington Federal will be asked to
elect three directors of Washington Federal for a three-year term and until
their successors are elected and qualified. The three nominees for election as
directors, which were selected by the Nominating Committee of the Board of
Directors, are John F. Clearman and H. Dennis Halvorson, who became directors of
Washington Federal following the merger of Metropolitan Bancorp into Washington
Federal on November 29, 1996, and W. Alden Harris, who also currently serves as
a director of Washington Federal. There are no arrangements or understandings
between the persons named and any other person pursuant to which such person was
selected as a nominee for election as a director at the Annual Meeting, and no
director or nominee for director is related to any other director or executive
officer of Washington Federal by blood, marriage or adoption.
If any person named as 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 of
Washington Federal. Alternatively, under such circumstances the Board of
Directors of Washington Federal may reduce the number of directors of Washington
Federal.
4
<PAGE> 8
INFORMATION WITH RESPECT TO NOMINEES FOR DIRECTOR AND CONTINUING DIRECTORS
The following tables set forth information relating to the nominees of
Washington Federal for election as directors and directors of Washington Federal
whose term continues.
NOMINEES FOR THREE-YEAR TERM EXPIRING IN 2000
<TABLE>
<CAPTION>
COMMON STOCK OWNED
DIRECTLY OR
INDIRECTLY
POSITIONS WITH AS OF OCTOBER 1,
WASHINGTON FEDERAL 1996(2)(3)
AND PRINCIPAL OCCUPATION DIRECTOR --------------------
NAME AGE DURING PAST FIVE YEARS SINCE(1) NO. PERCENTAGE
- -------------------- --- -------------------------- -------- ------- ----------
<S> <C> <C> <C> <C> <C>
John F. Clearman 58 Director; Director of 1996 8,396 .02%
Metropolitan Bancorp from
July 1993 to its merger
into the Company on
November 29, 1996; former
President and Chief
Executive Officer of N.C.
Machinery Co.; director of
Esterline Corporation.
H. Dennis Halvorson 57 Director; Director of 1996 10,848 .03%
Metropolitan Bancorp from
September 1994 to its
merger into the Company on
November 29, 1996; former
President and Chief
Executive Officer of
United Bank, a Savings
Bank
W. Alden Harris 63 Director; former Executive 1967 110,687 .27%
Vice President of
Washington Federal Savings
</TABLE>
THE BOARD OF DIRECTORS RECOMMENDS THAT THE NOMINEES
BE ELECTED AS DIRECTORS.
5
<PAGE> 9
DIRECTORS WITH TERM EXPIRING IN 1998
<TABLE>
<CAPTION>
COMMON STOCK OWNED
DIRECTLY OR
POSITIONS WITH INDIRECTLY AS
WASHINGTON FEDERAL OF OCTOBER 1,
AND PRINCIPAL 1996(2)(3)
OCCUPATION DIRECTOR --------------------
NAME AGE DURING PAST FIVE YEARS SINCE(1) NO. PERCENTAGE
- ------------------------ --- ---------------------- -------- ------- ----------
<S> <C> <C> <C> <C> <C>
Kermit O. Hanson 80 Director; Dean 1966 32,298 .08%
Emeritus Graduate
School of Business
Administration,
University of
Washington; Vice
Chairman, Pacific Rim
Bankers Program
E.W. Mersereau, Jr. 80 Vice Chairman of 1947 20,079 .05%
Washington Federal and
former Chairman,
President and Chief
Executive Officer of
First Federal Savings
and Loan Association
of Mount Vernon
Guy C. Pinkerton 62 Chairman, President 1991 528,174(4) 1.30%
and Chief Executive
Officer of Washington
Federal
</TABLE>
6
<PAGE> 10
DIRECTORS WITH TERM EXPIRING IN 1999
<TABLE>
<CAPTION>
COMMON STOCK OWNED
DIRECTLY OR
POSITIONS WITH INDIRECTLY AS
WASHINGTON FEDERAL OF OCTOBER 1,
AND PRINCIPAL 1996(2)(3)
OCCUPATION DIRECTOR --------------------
NAME AGE DURING PAST FIVE YEARS SINCE(1) NO. PERCENTAGE
- ------------------------ --- ---------------------- -------- ------- ----------
<S> <C> <C> <C> <C> <C>
Anna C. Johnson 45 Director; Senior 1995 1,113 --%
Partner, Scan East
West Travel, Seattle,
Washington
Richard C. Reed 75 Director; Management 1967 96,200 .24%
Consultant, Altman
Weil Pensa, Bellevue,
Washington; former
Chairman of the law
firm of Reed, McClure,
Moceri, Thonn and
Moriarty, Seattle,
Washington
Charles R. Richmond 57 Director; Executive 1995 233,294(4) .57%
Vice President and
Secretary of
Washington Federal
</TABLE>
- ------------------------------
(1) Includes tenure as a director of Washington Federal Savings and its
predecessors.
(2) Pursuant to rules promulgated by the SEC under the Exchange Act, a person is
considered to beneficially own shares of Common Stock if he or she has or
shares: (1) voting power, which includes the power to vote, or direct the
voting of the shares; or (2) investment power, which includes the power to
dispose, or direct the disposition of the shares.
(3) Based on information furnished by the respective directors. The percentage
of outstanding shares of Common Stock is based on the 40,695,450 shares of
Common Stock issued and outstanding on October 1, 1996, plus options to
purchase shares of Common Stock which are exercisable by a director prior to
December 31, 1996.
(4) Includes in the case of Messrs. Pinkerton and Richmond options to purchase
31,187 shares and 28,839 shares of Common Stock, respectively, which are
exercisable prior to December 31, 1996, as well as 213,457 shares and
143,723 shares of Common Stock, respectively, which are held pursuant to the
Retirement Plan.
7
<PAGE> 11
CERTAIN EXECUTIVE OFFICERS WHO ARE NOT DIRECTORS
The following table sets forth information concerning the executive
officers of Washington Federal who are not directors and who are listed in the
Summary Compensation Table under "Executive Compensation" below.
<TABLE>
<CAPTION>
COMMON STOCK
OWNED DIRECTLY OR
INDIRECTLY AS OF
POSITIONS WITH WASHINGTON FEDERAL OCTOBER 1, 1996(1)(2)
AND PRINCIPAL OCCUPATION ---------------------
NAME AGE DURING PAST FIVE YEARS NO. PERCENTAGE
- ------------------- --- ----------------------------------- ------ ----------
<S> <C> <C> <C> <C>
William A. Cassels 55 Executive Vice President since 87,557(3) .22%
October 1995; previously served as
Senior Vice President
Ronald L. Saper 46 Executive Vice President and Chief 18,266(3) .04%
Financial Officer since October
1995; previously served as Senior
Vice President and Chief Financial
Officer
</TABLE>
- ------------------------------
(1) Pursuant to rules promulgated by the SEC under the Exchange Act, a person is
considered to beneficially own shares of Common Stock if he or she has or
shares: (1) voting power, which includes the power to vote, or direct the
voting of the shares, or (2) investment power, which includes the power to
dispose, or direct the disposition of the shares.
(2) Based on information furnished by the respective officers. The percentage of
outstanding shares of Common Stock is based upon the 40,695,450 shares of
Common Stock issued and outstanding on October 1, 1996, plus options to
purchase shares of Common Stock which are exercisable by that executive
officer prior to December 31, 1996.
(3) Includes in the case of Messrs. Cassels and Saper options to purchase 7,187
shares and 9,582 shares of Common Stock, respectively, which are exercisable
prior to December 31, 1996, as well as 6,160 shares and 4,390 shares of
Common Stock, respectively, which are held pursuant to the Retirement Plan.
STOCKHOLDER NOMINATIONS
Pursuant to Article IV, Section 4.15 of Washington Federal's Bylaws,
stockholders of Washington Federal may name nominees for election to the Board
of Directors by submitting such written nominations to the Secretary of
Washington Federal at least 90 days prior to the anniversary date of the mailing
of proxy
8
<PAGE> 12
materials by Washington Federal in connection with the immediately preceding
annual meeting of stockholders of Washington Federal. Such stockholder's notice
shall set forth (a) the name and address of the stockholder who intends to make
the nomination and of the person or persons to be nominated; (b) a
representation that the stockholder is a holder of record of stock of Washington
Federal entitled to vote at such meeting and intends to appear in person or by
proxy at the meeting to nominate the person or persons specified in the notice;
(c) a description of all arrangements or understandings between the stockholder
and each nominee and any other person or persons (naming such person or persons)
pursuant to which the nomination or nominations are to be made by the
stockholder; (d) such other information regarding each nominee proposed by such
stockholder as would be required to be included in a proxy statement filed
pursuant to the proxy rules of the SEC; and (e) the consent of each nominee to
serve as director of Washington Federal if elected. If a nomination is made in
accordance with applicable requirements, ballots will be provided for use by
stockholders at the stockholder meeting bearing the name of such nominee or
nominees. No nominations for election as a director at the Annual Meeting were
submitted to Washington Federal in accordance with the foregoing requirements.
SECTION 16(A) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
Under Section 16(a) of the Exchange Act, Washington Federal's directors and
executive officers and any persons holding more than 10% of the outstanding
Common Stock are required to report their ownership of Washington Federal's
securities and any changes in that ownership to the SEC by specific dates.
Washington Federal believes that in the fiscal year ended September 30, 1996,
all of these filing requirements were satisfied by its directors and executive
officers. In making the foregoing statements, Washington Federal has relied in
part on representations of its directors and executive officers and copies of
the reports that they have filed with the SEC.
THE BOARD OF DIRECTORS AND ITS COMMITTEES
Meetings of the Board of Directors are held regularly each month. The Board
of Directors of Washington Federal held a total of 13 meetings during the last
fiscal year. No incumbent director attended fewer than 75% of the aggregate of
the total number of meetings of the Board of Directors held during his tenure in
office during the last fiscal year or the total number of all meetings held by
all committees of the Board of Directors on which he or she served during such
year, except Messrs. Mersereau and Reed, who attended one of the two Personnel
and Stock Compensation Committee meetings held during the year. Washington
Federal pays
9
<PAGE> 13
the directors a $1,150 monthly fee, provided they attend at least 10 of the 12
regular monthly meetings of the Board of Directors held during a calendar year.
The Board of Directors has established Executive, Audit, Personnel and Stock
Compensation and Nominating Committees. Directors are paid $375 (committee
chairmen are paid $475) for each committee meeting attended, other than short
meetings held in conjunction with regularly scheduled board meetings.
The Board of Directors selects certain of its members to serve on its
Executive Committee. The present Executive Committee consists of Messrs.
Pinkerton (Chairman), Mersereau (Vice Chairman), Hanson, Harris and Reed. The
Executive Committee is authorized to exercise all the authority of the Board of
Directors in the management of Washington Federal between board meetings unless
otherwise provided by the Bylaws of Washington Federal. The Executive Committee
did not meet during the last fiscal year.
The Board of Directors has a standing Audit Committee. The Audit Committee
consists of Mr. Mersereau (Chairman), Mr. Hanson and Ms. Johnson. The Audit
Committee reviews and accepts the reports of Washington Federal's independent
auditors and the federal examiners. The Audit Committee met three times during
the last fiscal year.
The Board of Directors has a standing Personnel and Stock Compensation
Committee (the "Committee"). The Committee consists of Messrs. Harris
(Chairman), Mersereau and Reed. Except for Mr. Harris, who served as an
Executive Vice President of Washington Federal Savings until his retirement on
December 31, 1992, no member of the Committee has served as an officer or an
employee of Washington Federal or Washington Federal Savings during the past
five years. The Committee studies personnel and compensation recommendations
made by the Chief Executive Officer and makes recommendations to the Board of
Directors. Further, the Committee is authorized to act under Washington
Federal's stock option plans to grant stock options, stock appreciation rights
and performance shares. The Committee met twice during the last fiscal year.
The Board of Directors has appointed three of its members to serve as a
Nominating Committee in connection with the election of directors. For the
present Annual Meeting, the Board of Directors appointed Mr. Hanson (Chairman),
Ms. Johnson and Mr. Mersereau to serve on the Nominating Committee. The
Nominating Committee met one time during the last fiscal year.
10
<PAGE> 14
EXECUTIVE COMPENSATION
SUMMARY COMPENSATION TABLE
The following table sets forth a summary of certain information concerning
the compensation awarded or paid by or on behalf of Washington Federal for
services rendered in all capacities during the last three fiscal years to the
Chief Executive Officer and the other executive officers of Washington Federal
whose total compensation during the last fiscal year exceeded $100,000 (the
"Named Executives").
<TABLE>
<CAPTION>
LONG-TERM COMPENSATION
----------------------------
AWARDS
ANNUAL COMPENSATION ------------------- PAYOUTS
----------------------------------- RESTRICTED -------
NAME AND PRINCIPAL FISCAL OTHER ANNUAL STOCK OPTIONS/ LTIP ALL OTHER
POSITION DURING FISCAL 1996 YEAR SALARY(1) BONUS(2) COMPENSATION(3) AWARD(S) SARS(#) PAYOUTS COMPENSATION(4)
- --------------------------------- ------ -------- -------- --------------- ---------- ------- ------- ---------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Guy C. Pinkerton 1996 $306,600 $25,704 0 0 11,000 0 $36,252
Chairman, President and 1995 274,050 50,250 0 0 22,000 0 33,540
Chief Executive Officer 1994 245,900 51,030 0 0 22,000 0 31,590
Charles R. Richmond 1996 $209,175 $16,434 0 0 8,250 0 $23,166
Executive Vice President 1995 186,825 32,745 0 0 16,500 0 21,840
and Secretary 1994 175,950 34,020 0 0 16,500 0 21,060
Ronald L. Saper 1996 $141,000 $11,760 0 0 6,000 0 $16,560
Executive Vice President and 1995 118,500 21,600 0 0 12,100 0 14,430
Chief Financial Officer 1994 100,500 20,790 0 0 12,100 0 12,870
William A. Cassels 1996 $114,930 $ 9,569 0 0 5,500 0 $13,471
Executive Vice President 1995 96,630 17,754 0 0 11,000 0 11,856
1994 83,700 17,262 0 0 11,000 0 10,686
</TABLE>
- ------------------------------
(1) Includes director's fees for Messrs. Pinkerton and Richmond. Includes
amounts deferred by Messrs. Saper and Cassels pursuant to the Retirement
Plan, which permits deferrals pursuant to Section 401(k) of the Internal
Revenue Code of 1986, as amended (the "Code"). During fiscal 1996, 1995 and
1994, Messrs. Pinkerton and Richmond did not defer amounts pursuant to the
Retirement Plan.
(2) Represents cash profit sharing bonus paid semi-annually to all officers and
employees as of June 30 and December 31.
(3) Washington Federal owns automobiles for use by Messrs. Richmond, Saper and
Cassels and certain other employees. Washington Federal also pays club dues
and other miscellaneous benefits for certain executive officers. Washington
Federal has concluded that the individual and aggregate amount of personal
benefits provided, which are not reflected in the above table, did not
exceed the lesser of $50,000 or 10% of the cash compensation reported above
for each of the Named Executives.
(4) Consists of amounts allocated or paid by Washington Federal to the executive
officer pursuant to the Retirement Plan.
11
<PAGE> 15
OPTIONS/SARS GRANTED IN FISCAL 1996
The following table sets forth certain information with respect to stock
options granted to the Named Executives during the year ended September 30,
1996.
<TABLE>
<CAPTION>
POTENTIAL
INDIVIDUAL SHARES REALIZABLE VALUE AT
------------------------------------------------------ ASSUMED RATES OF
% OF TOTAL STOCK PRICE
OPTIONS EXERCISE OR APPRECIATION FOR
GRANTED TO BASE PRICE OPTION TERM(3)
OPTIONS EMPLOYEES IN (PER EXPIRATION -------------------
NAME GRANTED(1) FISCAL YEAR SHARE)(2) DATE 5% 10%
- -------------------------- ---------- ------------ ------------- ---------- -------- --------
<S> <C> <C> <C> <C> <C> <C>
Guy C. Pinkerton 11,000 3.40% $ 20.23 11/29/05 $139,920 $354,640
Charles R. Richmond 8,250 2.43 20.23 11/29/05 104,940 265,980
Ronald L. Saper 6,000 1.85 20.23 11/29/05 76,320 193,440
William A. Cassels 5,500 1.70 20.23 11/29/05 69,960 177,320
</TABLE>
- ------------------------------
(1) The options vest 20% each year beginning April 30, 1999 and continuing
through April 30, 2003, except Mr. Pinkerton's options vest 100% on April
30, 1998.
(2) In all cases, the exercise price was based on the bid price of a share of
Common Stock on the date of grant.
(3) Assumes future stock prices of $32.95 and $52.47 at compounded rates of
return of five percent and 10 percent, respectively. The valuations listed
above are based on hypothetical rates of appreciation in the price of the
Common Stock (five percent and 10 percent, compounded annually) and are
included here in response to specific requirements of the SEC. Washington
Federal makes no representation that its stock will show similar
appreciation.
12
<PAGE> 16
AGGREGATE OPTIONS/SARS EXERCISED IN FISCAL 1996 AND FISCAL YEAR END OPTION/ SAR
VALUES
The following table sets forth certain information with respect to the
exercise of stock options during fiscal 1996 and outstanding stock options held
by the Named Executives as of September 30, 1996.
<TABLE>
<CAPTION>
VALUE OF UNEXERCISED
IN-THE-MONEY
NUMBER OF UNEXERCISED OPTIONS/SARS AT
SHARES OPTIONS/SARS AT YEAR END SEPTEMBER 30, 1996(1)
ACQUIRED VALUE --------------------------- ---------------------------
NAME ON EXERCISE REALIZED EXERCISABLE UNEXERCISABLE EXERCISABLE UNEXERCISABLE
- ---------------------- ----------- -------- ----------- ------------- ----------- -------------
<S> <C> <C> <C> <C> <C> <C>
Guy C. Pinkerton 30,553 $122,767 24,200 33,063 $ 61,831 $ 128,080
Charles R. Richmond 9,885 160,493 22,850 63,343 266,529 331,148
Ronald L. Saper 2,904 13,750 7,986 49,990 43,643 255,921
William A. Cassels 0 0 4,791 37,438 29,824 190,944
</TABLE>
- ------------------------------
(1) The indicated value is based on the $23.625 per share market value of the
Common Stock at September 30, 1996, minus the exercise price.
REPORT OF THE PERSONNEL AND STOCK COMPENSATION COMMITTEE
The Personnel and Stock Compensation Committee reviews and establishes
management compensation and compensation policies and procedures. Following
review and approval by the Committee, all issues pertaining to executive
compensation are submitted to the full Board of Directors for their approval.
The Committee also has responsibility for the grant of awards under Washington
Federal's stock option plans.
Executive officer compensation adjustments were based on Washington
Federal's overall performance in the past year and an analysis of compensation
levels necessary to attract and maintain quality personnel. In this way,
Washington Federal is able to compete for and retain talented executives who are
critical to Washington Federal's long-term success and aligns the interest of
those with the long-term interests of Washington Federal's stockholders.
Executive compensation consists of three components: cash compensation,
including base salary and semi-annual incentive bonus; long-term incentive
compensation in the form of stock options; and executive benefits. The
components are intended to provide incentives to achieve short and long-range
objectives of Washington Federal and to reward exceptional performance.
Performance is evaluated not only with respect to Washington Federal's earnings
but also with respect to comparable industry performance, the accomplishment of
Washington Federal's business objectives and the individual's contribution to
Washington Federal's core
13
<PAGE> 17
earnings and stockholder value. The competitiveness of Washington Federal's
compensation structure is determined by a thorough review of compensation survey
data collected by the Committee. To motivate job performance and to encourage
growth in stockholder value, stock options are granted under Washington
Federal's stock option plan to all executives and other personnel in order to
encourage substantial contributions toward the overall success of Washington
Federal. The Committee believes that this focuses attention on managing
Washington Federal from the perspective of an owner with an equity stake in the
business. With respect to executive benefits, executive officers receive all
normal employee fringe benefits.
In determining the overall compensation package for the Chief Executive
Officer, the Committee considered each of the factors enumerated in the
preceding paragraphs regarding compensation for executive officers of Washington
Federal, as well as the financial performance achieved by Washington Federal
during the past fiscal year. In addition to a high level of earnings, Washington
Federal continued at or near the top of the financial industry for such key
financial performance measures as return on average assets, return on average
equity, capital and efficiency ratios. Additionally, the Committee reviewed
various compensation packages provided to executive officers of publicly-traded
financial institutions. The results of such review showed Mr. Pinkerton's
overall compensation package to be below the median for chief executive officers
of publicly-traded financial institutions of comparable size and performance.
Dated this 30th day of September 1996
THE PERSONNEL AND STOCK
COMPENSATION COMMITTEE
W. Alden Harris, Chairman
Kermit O. Hanson
Richard C. Reed
14
<PAGE> 18
PERFORMANCE GRAPH
The following graph sets forth the cumulative total stockholder return
(assuming reinvestment of dividends) to Washington Federal's stockholders during
the period February 3, 1995 through September 30, 1996, as well as an overall
stock market index (NASDAQ-U.S.) and the NASDAQ Financial Stocks index during
this period. On February 3, 1995, Washington Federal, Inc. completed its
acquisition of Washington Federal Savings in connection with the reorganization
of Washington Federal Savings into the holding company form of organization.
<TABLE>
<CAPTION>
Measurement Period WASHINGTON Nasdaq Stock Market Nasdaq
(Fiscal Year Covered) FEDERAL, INC. (US Companies) Financial Stocks
<S> <C> <C> <C>
02/03/95 100.0 100.0 100.0
03/31/95 100.6 106.1 104.6
09/29/95 122.1 136.0 129.1
03/29/96 125.4 144.1 144.1
09/30/96 139.2 161.3 160.0
</TABLE>
Notes:
A. The lines represent monthly index levels derived from
compounded daily returns that include all dividends.
B. The indexes are reweighted daily, using the market
capitalization on the previous trading day.
C. If the monthly interval, based on the fiscal year-end, is not
a trading day, the preceeding trading day is used.
D. The index level for all series was set to $100 on 02/03/95.
The stock performance graph assumes $100 was invested on February 3, 1995.
15
<PAGE> 19
INDEBTEDNESS OF MANAGEMENT
Washington Federal Savings will from time to time make mortgage loans to
officers and employees on the security of their residences at prevailing
contractual interest rates. Management believes that these loans do not involve
more than the normal risks of collectibility or present other unfavorable
features. Except for loan origination fees, which Washington Federal Savings
waived prior to August 1989, these loans are made on substantially the same
terms as those prevailing at the time for comparable transactions with
non-affiliated persons. Washington Federal Savings also makes loans secured by
savings accounts to its non-executive officers and employees. These loans are
made on the same terms as those prevailing for comparable loans to
non-affiliated persons.
As a result of the enactment of the Financial Institutions Reform, Recovery
and Enforcement Act of 1989, which applies Section 22(h) of the Federal Reserve
Act to savings associations, any credit extended by Washington Federal Savings
to its executive officers, directors and, to the extent otherwise permitted,
principal stockholder(s), or any related interest of the foregoing, must be (i)
on substantially the same terms, including interest rates and collateral, as
those prevailing at the time for comparable transactions by Washington Federal
Savings with non-affiliated parties and (ii) not involve more than the normal
risk of repayment or present other unfavorable features.
RATIFICATION OF APPOINTMENT OF
INDEPENDENT PUBLIC ACCOUNTANTS
At the Annual Meeting, stockholders of Washington Federal will be asked to
ratify the appointment of Deloitte & Touche LLP as Washington Federal's
independent public accountants for the year ending September 30, 1997. This
appointment was recommended by the Audit Committee of Washington Federal and
approved by the Board of Directors of Washington Federal. If the stockholders of
Washington Federal do not ratify the appointment of Deloitte & Touche LLP, the
appointment will be reconsidered by the Board of Directors of Washington
Federal.
Deloitte & Touche LLP has advised Washington Federal that neither the firm
nor any of its members has any direct or indirect financial interest in, or
during the last three years has had any other connection with, Washington
Federal other than the usual relationship which exists between independent
public accountants and clients.
The professional services rendered by Deloitte & Touche LLP during fiscal
1996 consisted of auditing Washington Federal's financial statements, services
related to
16
<PAGE> 20
filings with the OTS and consultations on matters related to taxes, accounting
and financial reporting.
A representative of Deloitte & Touche LLP will be present at the Annual
Meeting and available to respond to appropriate questions and will be given an
opportunity to make a statement if the representative chooses to do so.
THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS A VOTE BY STOCKHOLDERS FOR
RATIFICATION OF THE APPOINTMENT OF DELOITTE & TOUCHE LLP AS WASHINGTON FEDERAL'S
INDEPENDENT PUBLIC ACCOUNTANTS FOR THE FISCAL YEAR ENDING SEPTEMBER 30, 1997.
OTHER MATTERS
Management is not aware of any business to come before the Annual Meeting
other than those matters described in this Proxy Statement. However, if any
other matters should properly come before the Annual Meeting, it is intended
that the proxies solicited hereby will be voted with respect to those other
matters in accordance with the judgment of the persons voting the proxies.
The cost of the solicitation of proxies will be borne by Washington
Federal. Washington Federal will reimburse brokerage firms and other custodians,
nominees and fiduciaries for reasonable expenses incurred by them in sending
proxy materials to the beneficial owners of the Common Stock. In addition to
solicitations by mail, directors, officers and employees of Washington Federal
may solicit proxies personally or by telephone without additional compensation.
STOCKHOLDER PROPOSALS
Any proposal which a stockholder wishes to have included in the proxy
solicitation materials to be used in connection with the next annual meeting of
stockholders of Washington Federal must be received at the main office of
Washington Federal no later than August 22, 1997. If such proposal is in
compliance with all of the requirements of Rule 14a-8 under the Exchange Act, it
will be included in the proxy statement and set forth on the form of proxy
issued for the next annual meeting of stockholders. It is urged that any such
proposals be sent by certified mail, return receipt requested.
17
<PAGE> 21
ANNUAL REPORTS
Stockholders of Washington Federal as of the record date for the Annual
Meeting are being forwarded a copy of Washington Federal's Annual Report to
Stockholders for the year ended September 30, 1996 (the "Annual Report").
Included in the Annual Report are the consolidated statements of financial
condition of Washington Federal as of September 30, 1996 and 1995 and the
related consolidated statements of operations, stockholders' equity and cash
flows for each of the years in the three-year period ended September 30, 1996,
prepared in accordance with generally accepted accounting principles, and the
related report of Washington Federal's independent public accountants. The
Annual Report is not a part of this Proxy Statement.
UPON RECEIPT OF A WRITTEN REQUEST, WASHINGTON FEDERAL WILL FURNISH TO ANY
STOCKHOLDER WITHOUT CHARGE A COPY OF ITS ANNUAL REPORT ON FORM 10-K FILED WITH
THE SEC UNDER THE EXCHANGE ACT FOR THE YEAR ENDED SEPTEMBER 30, 1996. UPON
WRITTEN REQUEST AND A PAYMENT OF A COPYING CHARGE OF $.10 PER PAGE, WASHINGTON
FEDERAL WILL FURNISH TO ANY SUCH STOCKHOLDER A COPY OF THE EXHIBITS TO THE
ANNUAL REPORT ON FORM 10-K. SUCH WRITTEN REQUESTS SHOULD BE DIRECTED TO RONALD
L. SAPER, EXECUTIVE VICE PRESIDENT AND CHIEF FINANCIAL OFFICER, WASHINGTON
FEDERAL, INC., 425 PIKE STREET, SEATTLE, WASHINGTON 98101. THE ANNUAL REPORT ON
FORM 10-K IS NOT A PART OF THIS PROXY STATEMENT.
18
<PAGE> 22
REVOCABLE PROXY
WASHINGTON FEDERAL, INC.
425 PIKE STREET, SEATTLE, WASHINGTON 98101
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS.
The undersigned hereby appoints the Board of Directors as Proxies, each with
the power to appoint his substitute, and hereby authorizes them to represent the
undersigned and to vote as designated below, all the shares of Common Stock of
Washington Federal, Inc. ("Washington Federal") held of record by the
undersigned on December 9, 1996, at the Annual Meeting of Stockholders to be
held at the Seattle Sheraton Hotel, 1400 Sixth Avenue, Seattle, Washington, on
January 23, 1997, or at any adjournment thereof (the "Annual Meeting").
This proxy may be revoked at any time before it is exercised.
This proxy, when properly executed, will be voted in the manner directed
herein by the undersigned stockholder. If no direction is made, this proxy will
be voted for the nominees named under Proposal 1 below and for Proposal 2. In
the discretion of the Proxies, shares may be voted cumulatively so as to elect
the maximum number of nominees for director.
(CONTINUED AND TO BE SIGNED ON REVERSE SIDE.)
- --------------------------------------------------------------------------------
FOLD AND DETACH HERE
[Washington Federal, Inc LOGO]
<PAGE> 23
December 20, 1996
To: Participants in the Washington Federal Savings Profit Sharing
Retirement Plan and Employee Stock Ownership Plan
As described in the attached materials, your proxy as a stockholder of
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 Washington Federal
Savings Profit Sharing Retirement Plan and Employee Stock Ownership Plan (the
"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 Plan by marking, dating, signing and returning the enclosed voting
instruction ballot to the trustees 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
shares held pursuant to the Plan are not received, the shares allocated to your
account will be voted by the trustees in their discretion. 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 Plan. Your will receive
other voting material for those shares owned by you individually and not under
the Plan.
Sincerely,
Guy C. Pinkerton
Chairman, President and
Chief Executive Officer
<PAGE> 24
WASHINGTON FEDERAL, INC.
ANNUAL MEETING OF STOCKHOLDERS
The undersigned hereby instructs the Trustees of the trust created
pursuant to the Washington Federal Savings Profit Sharing Retirement Plan and
Employee Stock Ownership Plan ("Plan") to vote the shares of Common Stock of
Washington Federal, Inc. ("Company") which were allocated to my account as of
December 9, 1996 under the Plan upon the following proposals to be presented at
the Annual Meeting of Stockholders of the Company to be held at the Seattle
Sheraton Hotel, 1400 Sixth Avenue, Seattle, Washington, on Tuesday, January 23,
1997, or at any adjournment.
1. Election of directors for three-year term expiring in 2000:
/ / FOR all nominees named below / / WITHHOLD AUTHORITY
(except as marked to the to vote for all nominees
contrary below) named below
John F. Clearman, H. Dennis Halvorson and W. Alden Harris
(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 of Deloitte & Touche LLP as the
independent public accountants of the Company for fiscal 1997.
/ / FOR / / AGAINST / / ABSTAIN
In its discretion, the Trustees are authorized to vote upon such other
business as may properly come before the Annual Meeting.
<PAGE> 25
SUCH VOTES ARE HEREBY SOLICITED BY THE BOARD OF DIRECTORS. THE
COMPANY'S BOARD OF DIRECTORS RECOMMENDS THAT YOU VOTE FOR THE NOMINEES FOR
DIRECTOR NAMED IN PROPOSAL 1 AND FOR PROPOSAL 2. IN THE DISCRETION OF THE
TRUSTEES, SHARES MAY BE VOTED CUMULATIVELY SO AS TO ELECT THE MAXIMUM NUMBER OF
NOMINEES FOR DIRECTOR.
Dated:_______________________________________
_____________________________________________
Signature
If you return this card properly signed but
do not otherwise specify, shares will be
voted FOR the Board of Director's nominees
for election and for Proposal 2 specified
above. If you do not return this card, shares
will be voted by the Trustees in their
discretion.
2
