Document:

Exhibit 10.1

 

CEPHALON,
INC.

2010 MANAGEMENT
INCENTIVE COMPENSATION PLAN

 

SECTION 1.
PURPOSE. The purpose of the Cephalon, Inc. Management Incentive
Compensation Plan (the “Plan”) is to provide Participants (as defined) employed
by Cephalon, Inc. (the “Company”) and its affiliates with incentive
compensation based upon the level of achievement of financial and other
performance criteria. The Plan will enhance the ability of the Company and its
affiliates to attract and retain individuals of exceptional managerial talent
upon whom, in large measure, the sustained progress, growth and profitability
of the Company depends.

 

SECTION 2.
DEFINITIONS. As used in the Plan, the following terms shall have the meanings
set forth below:

 

(a) 
“AWARD” means a cash payment.

 

(b) 
“BOARD” means the Board of Directors of the Company.

 

(c) “COMMITTEE”
means the Stock Option and Compensation Committee of the Board (or any
successor committee).

 

(d) 
“EXECUTIVE OFFICER” means an executive officer of the Company as appointed by the
Board of Directors or other key employee.

 

(e) “MEASUREMENT
PERIOD” means a period of time selected by the Committee for which performance
will be measured for purposes of Section 4.

 

(f) 
“MAXIMUM AWARD” means the limitation on awards payable under this Plan in any
year, which for the Chairman/Chief Executive Officer is 300% of his annual base
salary; for the Chief Operating Officer is 154% of his annual base salary; and
for any other Participant is 110% of the Participant’s annual base salary.

 

(g) “PARTICIPANT”
means any Executive Officer selected by the Committee to participate in the
Plan.

 

(h) “PERFORMANCE
PERIOD” means a period of time selected by the Committee to which an Award
relates.

 

(i) “TARGET
AWARD” means an Award level that may be paid if certain performance criteria
are achieved.

 

 

(j) 
“THRESHOLD PERFORMANCE” means a level of performance that supports a minimum
payout; the threshold performance level is established each year reflecting
business dynamics of the Company and the industry and historical performance
levels of the Company and industry.

 

SECTION 3.
ELIGIBILITY. Persons employed by the Company or any of its affiliates during a
Performance Period in active service in a managerial or professional role for
all or any part of the Performance Period are eligible to be Participants under
the Plan for such Performance Period (whether or not so employed or living at
the date an Award is made) and may be considered by the Committee for an Award.
An employee is not rendered ineligible to be a Participant by reason of being a
member of the Board.

 

SECTION 4.
AWARDS-GENERAL.

 

(a) Target
Awards.  The Committee will establish
the Target Awards for Participants at the beginning of each Performance Period.
For the Chairman/Chief Executive Officer, the Target Award shall be 100% of
annual base salary; for the Chief Operating Officer, the Target Award shall be
70% of annual base salary; for Participants other than the Chairman/Chief
Executive Officer and Chief Operating Officer, the Target Award shall be 50% of
annual base salary.

 

(b) Performance
Criteria; Award Levels.  The
performance criteria utilized by the Committee for the Chairman/Chief Executive
Officer may be based on individual performance, revenue, earnings per share,
other Company and business unit financial objectives, operational efficiency
measures, and other measurable objectives tied to the Company’s success or such
other criteria as the Committee shall determine in its discretion. The
Committee shall each year also determine specific levels of achievement of the
established performance criteria that correspond to Threshold Performance,
Target Award and Maximum Award.  Performance
criteria for Participants (other than Chairman/Chief Executive Officer) will be
established by management.  For the
Performance Period fiscal year 2010, the performance criteria for the
Chairman/Chief Executive Officer, Chief Operating Officer and the other Participants,
and the relationship between achievement of such performance criteria and respective
Award levels, are set out in the Schedules 1 and 2, respectively, to the Plan.

 

(c) Awards.  Awards will be made by the Committee
following the end of each Performance Period. Awards shall be paid after the
end of the Performance Period, except to the extent that a Participant has made
an election to defer the receipt of such Award pursuant to the Company’s
deferred compensation plan. The Award amount determined in accordance with
Schedule 2 may be increased or decreased by the Committee, provided, however,
than any Award may not exceed the applicable Maximum Award amount.

 

 

SECTION 5.
OTHER CONDITIONS.

 

(a) No person shall have any claim to an Award
under the Plan and there is no obligation for uniformity of treatment of
Participants under the Plan. Awards under the Plan may not be assigned or
alienated.

 

(b) Neither
the Plan nor any action taken hereunder shall be construed as giving to any
Participant the right to be retained in the employ of the Company or any
affiliate.

 

(c) The
Company or any affiliate shall have the right to deduct from any Award to be
paid under the Plan any federal, state or local taxes required by law to be
withheld with respect to such payment.

 

(d) Awards
under the Plan will not be included in base compensation or covered compensation
under the retirement programs of the company for purposes of determining
pensions, retirement and death related benefits.

 

SECTION 6.
DESIGNATION OF BENEFICIARIES. A Participant may, if the Committee permits,
designate a beneficiary or beneficiaries to receive all or part of the Award
which may be made to the Participant, or may be payable, after such Participant’s
death. A designation of beneficiary shall be made in accordance with procedures
specified by the Company and may be replaced by a new designation or may be
revoked by the Participant at any time. In case of the Participant’s death, an
Award with respect to which a designation of beneficiary has been made (to the
extent it is valid and enforceable under applicable law) shall be paid to the
designated beneficiary or beneficiaries. Any Award granted or payable to a
Participant who is deceased and not subject to such a designation shall be
distributed to the Participant’s estate. If there shall be any question as to
the legal right of any beneficiary to receive an Award under the Plan, the
amount in question may be paid to the estate of the Participant, in which event
the Company or its affiliates shall have no further liability to anyone with
respect to such amount.

 

SECTION 7.
PLAN ADMINISTRATION.

 

(a) The
Committee shall have full discretionary power to administer and interpret the
Plan and to establish rules for its administration (including the power to
delegate authority to others to act for and on behalf of the Committee) subject
to such resolutions, not inconsistent with the Plan, as may be adopted by the
Board. In making any determinations under or referred to in the Plan, the
Committee (and its delegates, if any) shall be entitled to rely on opinions,
reports, analysis or statements of employees of the Company and its affiliates
and of counsel, public accountants and other professional or expert persons.

 

(b) The
Plan shall be governed by the laws of the State of Delaware and applicable
Federal law.

 

 

SECTION 8.
MODIFICATION OR TERMINATION OF PLAN. The Board may modify or terminate the Plan
at any time, effective at such date as the Board may determine.ex10_1.htm

    
      

    

    
      Exhibit
10.1

      

      Written
Description of

      2010
Executive Incentive Compensation Annual Plan -

      Chief
Financial Officer and Chief Operating 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 Carter Peters, the Company’s
Chief Financial Officer and Chief Operating 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 five performance measurements of the
Company (and the weight given to each measurement) applicable to each award
level are as follows: (i) revenue growth (20%); (ii) net interest margin (20%);
(iii) overhead ratio (20%); (iv) pre-tax net income (20%); and (v) non-core
funding dependence (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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