Exhibit 10.21
Written Description of
2008 Executive Incentive Compensation Annual Plan -
President and Chief Executive Officer
The following is a description of the material terms of the 2008 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 Shaun Burke, the
Company's President and Chief Executive Officer, for 2008:
The Plan will pay a maximum of $120,000. 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 four
performance measurements of the Company (and the weight given to each
measurement) applicable to each award level are as follows: (i) net income
(30%); (ii) asset growth (30%); (iii) return on average equity (20%); and (iv)
return on average assets (20%). The following criteria must all be satisfied
before an award is paid under the Plan: (i) net income of the Company of at
least 80% of approved budget; (ii) satisfactory audits as determined by the
Board of Directors of the Company including but not limited to a CAMELS Bank
Examination Rating of 2 or better; (iii) no restatement of income for any prior
period previously released; and (iv) satisfactory performance appraisal,
actively employed by Guaranty Bank, and in good standing at the time the bonus
is paid. If there is an extraordinary event or item that is outside the
executive's control and his performance otherwise met and exceeded expectations
for the intent of the performance measure and award level, as determined solely
by the compensation committee of the Board of Directors of the Company, the
compensation committee may recommend to the Board of Directors an adjustment to
fairly compensate, provide an incentive to continue excellent performance and
retain the executive under this Plan.
