Document:

ex10-2.htm

Exhibit 10.2

 

Written Description of 

2017 Executive Incentive Compensation Annual Plan – 

Chief Financial Officer

 

 

The following is a description of the material terms of the 2017 Executive Incentive Compensation Annual Plan (the “Plan”) that was adopted by the Compensation Committee (the “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 (the "Executive"), for 2017:

 

The Plan will pay a maximum of $100,000 of which one hundred-percent (100%) of the bonus amount will be paid in cash. 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 four performance measurements of the Company (and the weight given to each measurement) applicable to each award level are as follows: (i) revenue growth (30%), (ii) net interest margin (20%), (iii) pre-tax net income (30%), and (iv) efficiency ratio (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 2017 of at least 75% of approved budget to receive full performance incentive and incentive will be reduced by 50% if Company achieves between 50% and 74.99% of budget net income; No incentive will be paid if net income is below 50% of 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) the Company and Guaranty Bank must maintain capital ratios to meet regulatory “well capitalized” status; and (iv) 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 2018 for the calendar year 2017. 

 

If the Company terminates the Executive’s employment other than for cause (as defined in Executive’s employment agreement) before the end of the performance year, then the Executive will be eligible for a prorated incentive payment (at target level) except for a change in control of the Company. If the Executive’s employment ends within twelve months following a change in control of the Company, then the Executive will be eligible for an incentive amount computed in accordance with the Executive’s employment agreement. 

 

The Plan will have a modifier that adjusts incentive awards upward or downward based on the Company’s performance relative to its peer group. The peer group will be a defined group of similar sized Midwestern publicly traded banks as determined by the Company’s compensation consultant. If the weighted average of the Company’s performance in return on average assets, net interest margin and efficiency ratio are at or above the peer group 60th percentile, the executives’ incentive awards will be increased by an additional ten percent of salary. If performance is above the 70th percentile, the awards will be increased by twenty percent of salary. If performance in the same three measurements falls below the 50th percentile, awards will be reduced by ten percent of salary.

 

The Board of Directors of the Company retains the right to make the final determination of the bonus payment and amount, if any, and may consider other pertinent facts prior to making an award. All incentive payments shall be subject to the Company’s Compensation Clawback Policy.ex10-3.htm

Exhibit 10.3

 

Written Description of 

2017 Executive Incentive Compensation Annual Plan - 

Chief Operating Officer

 

 

The following is a description of the material terms of the 2017 Executive Incentive Compensation Annual Plan (the “Plan”) that was adopted by the Compensation Committee (the “Committee”) of the Board of Directors of Guaranty Federal Bancshares, Inc. (the “Company”) with respect to the bonus payable to Robin Robeson, the Company’s Chief Operating Officer (the "Executive"), for 2017:

 

The Plan will pay a maximum of $107,500 of which one hundred-percent (100%) of the bonus amount will be paid in cash. 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 four performance measurements of the Company (and the weight given to each measurement) applicable to each award level are as follows: (i) revenue growth (30%), (ii) net interest margin (20%), (iii) pre-tax net income (30%), and (iv) efficiency ratio (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 2017 of at least 75% of approved budget to receive full performance incentive and incentive will be reduced by 50% if Company achieves between 50% and 74.99% of budget net income; No incentive will be paid if net income is below 50% of 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) the Company and Guaranty Bank must maintain capital ratios to meet regulatory “well capitalized” status; and (iv) 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 2018 for the calendar year 2017. 

 

If the Company terminates the Executive’s employment other than for cause (as defined in Executive’s employment agreement) before the end of the performance year, then the Executive will be eligible for a prorated incentive payment (at target level) except for a change in control of the Company. If the Executive’s employment ends within twelve months following a change in control of the Company, then the Executive will be eligible for an incentive amount computed in accordance with the Executive’s employment agreement. 

 

The Plan will have a modifier that adjusts incentive awards upward or downward based on the Company’s performance relative to its peer group. The peer group will be a defined group of similar sized Midwestern publicly traded banks as determined by the Company’s compensation consultant. If the weighted average of the Company’s performance in return on average assets, net interest margin and efficiency ratio are at or above the peer group 60th percentile, the executives’ incentive awards will be increased by an additional ten percent of salary. If performance is above the 70th percentile, the awards will be increased by twenty percent of salary. If performance in the same three measurements falls below the 50th percentile, awards will be reduced by ten percent of salary.

 

The Board of Directors of the Company retains the right to make the final determination of the bonus payment and amount, if any, and may consider other pertinent facts prior to making an award. All incentive payments shall be subject to the Company’s Compensation Clawback Policy.ex10-4.htm

Exhibit 10.4

 

Written Description of 

2017 Executive Incentive Compensation Annual Plan – 

Chief Lending Officer

 

The following is a description of the material terms of the 2017 Executive Incentive Compensation Annual Plan (the “Plan”) that was adopted by the Compensation Committee (the “Committee”) of the Board of Directors of Guaranty Federal Bancshares, Inc. (the “Company”) with respect to the bonus payable to H. Charles Puls, the Company’s Chief Lending Officer (the "Executive"), for 2017:

 

The Plan will pay a maximum of $86,500 of which one hundred-percent (100%) of the bonus amount will be paid in cash. 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 four 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) pre-tax net income (30%), and (iv) non-performing assets to average total assets (30%). 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 2017 of at least 75% of approved budget to receive full performance incentive and incentive will be reduced by 50% if Company achieves between 50% and 74.99% of budget net income; No incentive will be paid if net income is below 50% of 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) the Company and Guaranty Bank must maintain capital ratios to meet regulatory “well capitalized” status; and (iv) 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 2018 for the calendar year 2017. 

 

If the Company terminates the Executive’s employment other than for cause (as defined in Executive’s employment agreement) before the end of the performance year, then the Executive will be eligible for a prorated incentive payment (at target level) except for a change in control of the Company. If the Executive’s employment ends within twelve months following a change in control of the Company, then the Executive will be eligible for an incentive amount computed in accordance with the Executive’s employment agreement.

 

The Plan will have a modifier that adjusts incentive awards upward or downward based on the Company’s performance relative to its peer group. The peer group will be a defined group of similar sized Midwestern publicly traded banks as determined by the Company’s compensation consultant. If the weighted average of the Company’s performance in return on average assets, net interest margin and efficiency ratio are at or above the peer group 60th percentile, the executives’ incentive awards will be increased by an additional ten percent of salary. If performance is above the 70th percentile, the awards will be increased by twenty percent of salary. If performance in the same three measurements falls below the 50th percentile, awards will be reduced by ten percent of salary.

 

The Board of Directors of the Company retains the right to make the final determination of the bonus payment and amount, if any, and may consider other pertinent facts prior to making an award. All incentive payments shall be subject to the Company’s Compensation Clawback Policy.

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