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Exhibit 10.2

Written Description of
2010 Executive Incentive Compensation Annual Plan –
Chief Lending Officer

The following is a description of the material terms of the 2010 Executive
Incentive Compensation Annual Plan (the “Plan”) that was adopted by the
compensation committee of the Board of Directors of Guaranty Federal Bancshares,
Inc. (the “Company”) with respect to the bonus payable to Mike Mattson, the
Company’s Chief Lending Officer (the "Executive"), for 2010:

The Plan will pay a maximum of $50,000.  There are three possible levels of
incentive awards: threshold (25%); target (50%); and maximum (100%).  For any
bonus amount to be paid, the threshold level of performance must be
achieved.  The bonus amount will be prorated for performance achievements
between the threshold and target levels and between the target and maximum
levels.  The six performance measurements of the Company (and the weight given
to each measurement) applicable to each award level are as follows: (i) revenue
growth (10%); (ii) yield on loans (20%); (iii) pre-tax net income (10%); (iv)
delinquency ratio (20%); (v) adversely classified assets to capital and
allowance for loan losses (20%); and (vi) net charge-offs (20%).  The following
minimum criteria must all be satisfied before an award is paid under the Plan:
(i) net income of the Company for calendar year 2010 of at least 75% of approved
budget; (ii) satisfactory audits as determined by the Board of Directors of the
Company after review of findings from regulatory examination reports and
applicable audits and reviews; (iii) no restatement of income for any prior
period previously released; (iv) the bank’s capital ratios must meet the
“well-capitalized” regulatory standards at each call report period during 2010;
(v) satisfactory performance appraisal, actively employed by Guaranty Bank, and
in good standing at the time the bonus is paid, which will not be prior to the
public release of earnings in 2011 for the calendar year 2010; and (vi) the
Board of Directors of the Company retains the right to make the final
determination of the bonus payment and amount, if any.

The Plan also includes a provision requiring the "clawback" of any bonus paid to
the Executive under the Plan.  In the event that any payment under the Plan was
based on materially inaccurate financial statements or any other materially
inaccurate performance metric criteria, the Executive shall immediately pay back
such payment to the Company.  In addition, in the event that, after a payment
has been made under the Plan, the Executive voluntarily terminates his
employment and at the time of such termination Guaranty Bank has a composite
rating lower than 2 under the CAMELS rating system, the Executive shall
immediately pay back the full amount of such bonus amount upon such voluntary
termination of employment.
 
 

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