Exhibit 10.22
Written Description of
2008 Executive Incentive Compensation Annual Plan -
Chief Financial Officer and Chief Operating 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 Carter Peters, the
Company's Chief Financial Officer and Chief Operating Officer, for 2008:
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 (except
with respect to the performance measurement for full compliance with the
Sarbanes-Oxley Act of 2002 as described below). The five performance
measurements of the Company (and the weight given to each measurement)
applicable to each award level are as follows: (i) full compliance with the
Sarbanes-Oxley Act of 2002 (40%); (ii) net income (18%); (iii) asset growth
(18%); (iv) return on average equity (12%); and (v) return on average assets
(12%). 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.
