SCHEDULE 14A
(Rule 14a-101)
INFORMATION REQUIRED IN PROXY STATEMENT
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the Securities
Exchange Act of 1934 (Amendment No. )
Filed by the registrant [X]
Filed by a party other than the registrant [ ]
Check the appropriate box:
[ ] Preliminary Proxy Statement [ ] Confidential, for use of the Commission
Only (as permitted by Rule 14a 6(e)(2))
[X] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material pursuant to ss. 240.14a-11(c) or ss. 240.14a-12
Guaranty Federal Bancshares, Inc.
- --------------------------------------------------------------------------------
(Name of Registrant as Specified in Its Charter)
- --------------------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
Payment of filing fee (Check the appropriate box):
[X] No fee required
[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and 0-11.
(1) Title of each class of securities to which transaction applies:
- --------------------------------------------------------------------------------
(2) Aggregate number of securities to which transaction applies:
- --------------------------------------------------------------------------------
(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11. (set forth the amount on which the filing
fee is calculated and state how it was determined):
- --------------------------------------------------------------------------------
(4) Proposed maximum aggregate value of transaction:
- --------------------------------------------------------------------------------
(5) Total fee paid:
- --------------------------------------------------------------------------------
[ ] Fee paid previously with preliminary materials.
- --------------------------------------------------------------------------------
[ ] Check box if any part of the fee is offset as provided by Exchange Act
Rule 0- 11(a)(2) and identify the filing for which the offsetting fee was paid
previously. Identify the previous filing by registration statement number, or
the Form or Schedule and the date of its filing.
(1) Amount previously paid:
- --------------------------------------------------------------------------------
(2) Form, Schedule or Registration Statement No.:
- --------------------------------------------------------------------------------
(3) Filing Party:
- --------------------------------------------------------------------------------
(4) Date Filed:
- --------------------------------------------------------------------------------
<PAGE>
GUARANTY FEDERAL BANCSHARES, INC.
1341 WEST BATTLEFIELD
SPRINGFIELD MO 65807-4181
(417) 889-2494
-----------------------------------
NOTICE OF MEETING OF STOCKHOLDERS
To Be Held on October 27, 1999
Notice is hereby given that an annual meeting of the stockholders
("Meeting") of Guaranty Federal Bancshares, Inc. (the "Company") will be held at
the offices of the Guaranty Federal Savings Bank (the "Bank"), 1341 West
Battlefield, Springfield, Missouri, on October 27, 1999, at 5:00 p.m., Central
Time. Stockholders of record at the close of business on September 7, 1999, are
the stockholders entitled to vote at the meeting.
A Proxy Card and a Proxy Statement for the Meeting are enclosed.
The Meeting is being held for the purpose of considering and acting
upon:
1. The election of three directors.
2. The ratification of Baird, Kurtz & Dobson as Independent
Certified Public Accountant to the Company for the fiscal year
ending June 30, 2000.
3. Such other matters as may come properly before the Meeting
or any adjournments thereof. Except with respect to procedural
matters incident to the conduct of the Meeting, the Board of
Directors is not aware of any other business to come before
the Meeting.
BY ORDER OF THE BOARD OF DIRECTORS
/s/ James E. Haseltine
-----------------------------------
James E. Haseltine
President
Springfield, Missouri
September 24, 1999
THE BOARD OF DIRECTORS URGES YOU TO SIGN, DATE AND RETURN YOUR PROXY CARD AS
SOON AS POSSIBLE, EVEN IF YOU CURRENTLY PLAN TO ATTEND THE ANNUAL MEETING. THIS
WILL NOT PREVENT YOU FROM VOTING IN PERSON AT THE ANNUAL MEETING IF YOU DESIRE,
AND YOU MAY REVOKE YOUR PROXY BY WRITTEN INSTRUMENT AT ANY TIME PRIOR TO THE
VOTE AT THE ANNUAL MEETING. IF YOU ARE A STOCKHOLDER WHOSE SHARES ARE NOT
REGISTERED IN YOUR OWN NAME, YOU WILL NEED ADDITIONAL DOCUMENTATION FROM YOUR
RECORD HOLDER TO VOTE PERSONALLY AT THE MEETING.
<PAGE>
September 24, 1999
Dear Fellow Stockholder:
On behalf of the Board of Directors and management of Guaranty Federal
Bancshares, Inc., I cordially invite you to attend the 1999 Annual Meeting of
Stockholders to be held at the main office of Guaranty Federal, located at 1341
West Battlefield, on Wednesday, October 27, 1999 at 5:00 p.m. The attached
Notice of Annual Meeting of Stockholders and Proxy Statement describe the formal
business to be transacted at the meeting. Following the formal meeting, I will
report on the operations of the Company. Directors and officers of the Company,
as well as representatives of Baird, Kurtz & Dobson, independent accountants,
will be present to respond to any questions that stockholders may have.
Whether or not you plan to attend the meeting, please sign and date the
enclosed form of proxy and return it in the accompanying postage-paid return
envelope as soon as possible. This will not prevent you from voting in person at
the meeting, but will assure that your vote is counted if you are unable to
attend the meeting.
Respectfully,
/s/ James E. Haseltine
------------------------------------
James E. Haseltine
President and Chief Executive Officer
<PAGE>
GUARANTY FEDERAL BANCSHARES, INC.
1341 WEST BATTLEFIELD
SPRINGFIELD, MISSOURI 65807-4181
PROXY STATEMENT
GENERAL STATEMENT
This Proxy Statement has been prepared in connection with the
solicitation of proxies by the Board of Directors of Guaranty Federal
Bancshares, Inc. (the "Company") for use at the Annual Meeting of Stockholders
to be held on October 27, 1999, and at any adjournment(s) thereof. The Annual
Meeting will be held at 5:00 p.m. at the Company's corporate office at 1341 W.
Battlefield, Springfield, Missouri. It is anticipated that this Proxy Statement
will be mailed to Stockholders on or about September 24, 1999.
RECORD DATE--VOTING--VOTE REQUIRED FOR APPROVAL
All persons who were Stockholders of the Company on September 7, 1999,
("Record Date") will be entitled to cast votes at the meeting. Voting may be by
proxy or in person. As of the Record Date, the Company had 5,495,246 shares of
common stock outstanding.
Holders of a majority of the outstanding shares of common stock
entitled to vote, represented in person or by proxy, will constitute a quorum
for purposes of transacting business at the Annual Meeting.
Each proxy solicited hereby, if properly executed, duly returned to
management and not revoked prior to the meeting, will be voted at the Annual
Meeting in accordance with the Stockholder's instructions indicated thereon. If
no contrary instructions are given, each proxy received by management will be
voted in favor of all items on the agenda. Each Stockholder shall have one vote
for each share of stock owned.
A Stockholder giving a proxy has the power to revoke the proxy at any
time before it is exercised by filing with the Secretary of the Company written
instructions revoking it. A duly executed proxy bearing a later date will be
sufficient to revoke an earlier proxy. The proxy executed by a Stockholder who
attends the Annual Meeting will be revoked only if that Stockholder files the
proper written instrument with the Secretary prior to the end of the voting.
To the extent necessary to assure sufficient representation at the
Annual Meeting, proxies may be solicited by officers, directors and regular
employees of the Company personally, by telephone or by further correspondence.
Such officers, directors and regular employees of the Company will not be
compensated for their solicitation efforts. The cost of soliciting proxies from
Stockholders will be borne by the Company.
Regardless of the number of shares of the Company's common stock, par
value $0.10 per share ("Common Stock"), owned, it is important that Stockholders
be represented by proxy or be present in person at the Annual Meeting.
Stockholders are requested to vote by completing the enclosed Proxy Card and
returning it signed and dated in the enclosed postage-paid envelope.
Stockholders are urged to indicate their vote in the spaces provided on the
proxy card. Proxies solicited by the Board of Directors of the Company will be
voted in accordance with the directions given therein. Where no instructions are
indicated, proxies will be voted FOR the approval of the specific proposals
presented in this Proxy Statement, and upon any other business that may properly
come before the meeting or any adjournment thereof. Proxies marked as
abstentions will not be counted as votes cast. In addition, shares held in
street name which have been designated by brokers on proxy cards as not voted
will not be counted as votes cast. Proxies marked as abstentions or as broker
non votes, however,
1
<PAGE>
will be treated as shares present for purposes of determining whether a quorum
is present. Directors are elected by a plurality of votes of the shares present
in person or by proxy at the Meeting.
VOTING SECURITIES AND PRINCIPAL HOLDERS THEREOF
Persons and groups owning in excess of 5% of the Common Stock are
required to file certain reports regarding such ownership pursuant to the
Securities Exchange Act of 1934, as amended (the "1934 Act"). The Articles of
Incorporation of the Company (the "Articles of Incorporation") restrict the
voting by persons who beneficially own in excess of 10% of the outstanding
shares of Common Stock. This restriction does not apply to employee benefit
plans of the Company or the Bank. The following table sets forth, as of the
Record Date, persons or groups who own more than 5% of the Common Stock. Other
than as noted below, management knows of no person or group that owns more than
5% of the outstanding shares of Common Stock at the Record Date.
<TABLE>
<CAPTION>
=====================================================================================
<S> <C> <C> <C>
Name and Address Amount and Nature of
Of Beneficial Owner Beneficial Ownership Percent of Class
- -------------------------------------------------------------------------------------
Guaranty Federal Savings Bank 344,454(1) 6.3%
Employee Stock Ownership Plan ("ESOP")
1341 West Battlefield
Springfield, MO 65807-4181
- -------------------------------------------------------------------------------------
Carl Marks Management Company, L.P. 313,700(2) 5.7%
135 E. 57th Street
New York, New York 10022
- -------------------------------------------------------------------------------------
Great Southern Bancorp, Inc. 356,520(3) 6.5%
1451 East Battlefield
Springfield, MO 65807
=====================================================================================
</TABLE>
(1) Based on a Schedule 13G filed on February 13, 1998. Reflects shared
dispositive and voting power with respect to all shares listed. The ESOP
purchased such shares for the exclusive benefit of plan participants with
funds borrowed from the Company. These shares are held in a suspense
account and will be allocated among ESOP participants annually on the basis
of compensation as the ESOP debt is repaid. The ESOP Committee consisting
of certain non-employee directors or the Board instructs the ESOP Trustee
regarding investment of ESOP plan assets. The ESOP Trustee must vote all
shares allocated to participant accounts under the ESOP as directed by
participants. Unallocated shares and shares for which no timely voting
direction is received, will be voted by the ESOP Trustee as directed by the
ESOP Committee.
(2) Based on a Schedule 13G jointly filed on July 6, 1998 by Carl Marks
Management Company, L.P., Andrew M. Boas and Robert C. Ruocco. Sole voting
power and sole dispositive power is reported for all shares by Carl Marks
Management Company, L.P. Each of Messrs. Boas and Ruocco report shared
voting power and shared dispositive power over the same shares.
(3) Based on a Schedule 13 G jointly filed on October 13, 1998 by Great
Southern Bancorp, Inc., William V. Turner, Don M. Gibson, Richard L. Wilson
and Steven G. Mitchem. Messrs. Turner and Mitchem share the same address
with Great Southern Bancorp, Inc. Messrs. Gibson and Wilson report an
address of 430 South Avenue, Springfield, Missouri 65806. Great Southern
Bancorp, Inc. reports sole voting and dispositive power over 311,200 shares
and no shared voting or dispositive power over any shares. Mr. Turner
reports sole voting and dispositive power over 6,340 shares and shared
voting and dispositive power over 22,800 shares. Mr. Gibson reports sole
voting and dispositive power over 5,911 shares. Mr. Wilson reports shared
voting and dispositive power over 10,269 shares. Mr. Mitchem reports shared
voting and dispositive power over 500 shares.
2
<PAGE>
The following table sets forth certain information as of the Record
Date, with respect to the Shares of the Company's Common Stock beneficially
owned by each of the Directors of the Company, and the total owned by directors
and executive officers as a group.
================================================================================
Total Shares Percent of Total
Beneficially Outstanding
Name of Beneficial Owner Owned Common Shares
- ------------------------------ ------------ ----------------
Jack L. Barham 31 ,807(1)(2) *
James E. Haseltine 65,749(3) 1.2%
Wayne V. Barnes 50,793(1)(2) *
George L. Hall 14,069(1)(2) *
Ivy L. Rogers 19,211(1)(2) *
Gary Lipscomb 41,810(1)(2) *
Raymond D. Tripp 6,000(1) *
Gregory V. Ostergren 1,000(1)
Total owned by all directors and
executive officers as a group (ten 307,722(4) 5.5%
persons)
================================================================================
* Less than 1%
- --------------------------------
(1) Excludes 344,454 shares of Common Stock held under the ESOP and 50,927
shares held under a restricted stock plan (the "RSP") and a recognition and
retention plan (the "RRP") for which such individual serves as a member of
the ESOP, RRP or RSP Committee or Trustee Committee. Such individual
disclaims beneficial ownership with respect to such shares held in a
fiduciary capacity.
(2) Includes 4,681 shares of Common Stock that the individual has the right to
acquire through the exercise of options within 60 days of the Record Date.
Includes 1,503 shares over which the individual shares voting power.
(3) Includes 9,389 shares of Common Stock that the individual has the right to
acquire through the exercise of options within 60 days of the Record Date.
Includes 4,157 shares over which the individual shares voting power.
(4) Includes 61,350 shares that may be acquired within 60 days of the Record
Date through the exercise of options. Excludes 340,242 shares of Common
Stock held under the ESOP (344,454 shares minus the 4,212 shares allocated
to executive officers) and 50,927 shares held in the RSP and RRP for which
all directors other than Mr. Haseltine serve as members of the ESOP, RRP or
RSP Committees or Trustee Committees. Such individuals disclaim beneficial
ownership with respect to such shares held in a fiduciary capacity.
SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
-------------------------------------------------------
Section 16(a) of the 1934 Act requires the Company's officers and
directors, and persons who own more than ten percent of the Common Stock, to
file reports of ownership and changes in ownership of the Common Stock, on Forms
3, 4 and 5, with the Securities and Exchange Commission ("SEC") and to provide
copies of those Forms 3, 4 and 5 to the Company.
Based upon a review of the copies of the forms furnished to the
Company, or written representations from certain reporting persons that no Forms
5 were required, the Company believes that all Section 16(a) filing requirements
applicable to its officers and directors were complied with during the 1999
fiscal year.
3
<PAGE>
FIRST PROPOSAL
ELECTION OF DIRECTORS
The following table shows the name, age and position during the past
five years of each nominee for election as director, and the length of time he
has served as a director. The term of each director is three years.
Unless otherwise specified on the proxies received by the Company, it
is intended that proxies received in response to this solicitation will be voted
in favor of the election of each person named in the following table to be a
director of the Company for a three-year term, and until his successor is
elected and qualified. There are no arrangements or understandings between the
nominees or directors and any other person pursuant to which any such person was
or is selected as a director or nominee.
THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS THAT YOU VOTE FOR THE
FOLLOWING NOMINEES.
Nominees for Three-Year Terms Expiring 2002
=====================================================================
Name Age (1) Director Since Position
Wayne V. Barnes 67 1976 Director
Ivy L. Rogers 80 1990 Director
Gregory V. Ostergren 44 1999 Director
=====================================================================
(1) As of the Record Date
Wayne V. Barnes was the owner of Sunnyland Stages, Inc., until its sale in
1998. He is presently the owner of Sunnyland Tours, Inc., Springfield, Missouri.
Mr. Barnes attended the University of Missouri and Drury College, and served in
the US Navy. He is active in many civic organizations.
Ivy L. Rogers retired from the US Department of Justice Bureau of Prisons.
He held position as Chief Construction Representative working out of Washington,
DC and other parts of the country. He was self-employed as a consultant for
construction projects. He supervised construction of several new buildings from
1982 to 1996 for Greene County Missouri. Mr. Rogers served in the US Navy
Construction Battalion during World War II. He is an ordained deacon in a
Southern Baptist Church.
Gregory V. Ostergren is the President and Chief Executive Officer of
American National Property and Casualty Insurance Company, Springfield,
Missouri. After graduating from the University of Minnesota in 1977, Mr.
Ostergren held various positions at Allstate Insurance Company in Chicago,
Illinois, and Mutual Service Insurance Company in St. Paul, Minnesota. He moved
to Springfield, Missouri in 1990, with his family. He is a member of the
American Academy of Actuaries and an Associate of the Casualty Actuarial
Society. He is also Chairman of the College of Natural and Applied Sciences
Advisory Board for Southwest Missouri State University, on the Board of
Directors of the Springfield Public School Foundation, past Board Member and
Treasurer of the United Way of the Ozarks, and has served on a number of other
professional and civic boards.
4
<PAGE>
Directors Who Are Not Nominees
Who Will Continue in Office After the Meeting
================================================================================
Current
Director Term
Name Age (1) Position(s) Since Expires
- ---------------- ---------- ------------- ----- ---------
George L. Hall 91 Director 1987 2000
Gary Lipscomb 69 Director 1991 2000
Jack L. Barham 66 Director, Chairman 1983 2001
James E. Haseltine 53 Director, President, CEO 1990 2001
Raymond D. Tripp 54 Director 1998 2001
================================================================================
(1) As of the Record Date
Biographical Information
The principal occupation of each Director is presented below:
George L. Hall is a retired owner and manager of the Ed. V. Williams
Clothing Company in Springfield. He is active in many civic and religious
organizations.
Gary Lipscomb, CPA, practiced as a Certified Public Accountant for over 25
years in Springfield, Missouri retiring from his firm, Lipscomb, Kirkpatrick and
Company, CPA's in August of 1988 to devote full time to the operation of
Lipscomb Ford-Chrysler, Inc. in Branson, Missouri. He sold his Branson operation
in December of 1993 and since that time has owned and operated, with his wife
Betty, Lipscomb Mitsubishi in Springfield, Missouri. Mr. Lipscomb has been and
is active in many social, fraternal, and religious activities. Mr. Lipscomb owns
various real estate investments in Springfield and Branson, including a
partnership interest in the Galleria in Springfield, Missouri.
Jack L. Barham worked at the Bank for 24 years and retired 1995. He served
in various positions of responsibility and was a Realtor and appraiser. In 1983
he was elected to the Board of Directors and in 1990 was elected Vice President
and Chairman of the Board. He served in the US Navy, is a deacon at Ridgecrest
Baptist Church and has been a member of various civic organizations.
James E. Haseltine joined the Bank in 1983, and has served as Director,
President and Chief Executive Officer since 1990. After graduating Drury College
in 1968, he served with the US Army in the Republic of Viet Nam. Since that
time, he has served as a founding member and Chairman of the Affordable Housing
Action Board of Springfield, an organization serving low to moderate income
families.
Currently, he serves as a director of America's Community Bankers, a
national trade organization serving financial institutions, is Vice President of
the Springfield Business and Development Corporation, a director of the Home
Builders Association of Springfield, and a director of the Springfield Public
Schools Foundation. He is a member of First and Calvary Presbyterian Church.
Raymond D. Tripp is President/Owner of Bolivar Insulation Company. Before
relocating to Springfield five years ago, he worked for Owens Corning in Toledo,
Ohio for seventeen years. Raymond and Linda, his wife, own and operate ten
building material contracting branches throughout Missouri and Northwest
Arkansas. He is very active in Southeast Rotary Club as a director, he serves as
a director of the Missouri Golf Association, board member of the Springfield
Business Development Corporation, board member of the Private Industry Job
Council, and member in the Insulation Contractors Advisory Boards, Home Builders
Association, and Springfield Contractors Association.
5
<PAGE>
Meetings and Committees of the Board of Directors
The business of the Company is conducted at regular and special
meetings of the full Board of Directors and its standing committees. The
standing committees consist of the Executive, Audit, Investment, ESOP (Employee
Stock Ownership Plan), Option, RRP and RSP Committees.
During fiscal 1999, the Board of Directors met at 12 regular meetings
and one special meeting called in accordance with the bylaws. No Director
attended less than 75% of said meetings and the meetings held by all committees
of the Board of Directors on which he served.
The Audit Committee consists of Messrs. Lipscomb, Barnes, Hall, Rogers,
Barham, Tripp and Ostergren. This standing committee regularly meets on a
quarterly basis for the first three fiscal quarters with the internal auditor to
review audit programs and the results of audits of specific areas as well as
other regulatory compliance issues. In addition, the audit committee, along with
the entire Board of Directors, meets with the independent certified public
accountants to review the results of the annual audit and other related matters.
The Audit Committee met four times during the fiscal year ended June 30, 1999.
The Nominating Committee, a non-standing committee, meets once a year
and is composed of the board of directors whose terms will not expire at the
next annual meeting. Nominations by a stockholder will be considered if written
and delivered or mailed by first class United States mail, postage prepaid, to
the Secretary of the Corporation between 30 and 60 days prior to the meeting.
However, if less than 31 days' notice of the meeting is given to stockholders,
written notice must be similarly given no later than the tenth day after notice
of the meeting was mailed to stockholders. A nomination must set forth, with
respect to the nominee, (i) name, age, and addresses, (ii) principal occupation
or employment, (iii) Common Stock beneficially owned, (iv) other information
that would be required in a proxy statement. The stockholder giving notice must
list, for himself, name and address as they appear on the Corporation's books,
and the amount of Common Stock beneficially owned.
The entire Board of Directors functions as a compensation committee,
however Mr. Haseltine does not participate in matters of his own compensation.
The committee meets as needed and met one time during the fiscal year ended June
30, 1999.
Directors' Compensation
Each member of the Board of Directors receive a yearly fee of $9,000,
payable monthly. Directors do not receive fees for attendance at committee
meetings.
Directors Barham, Barnes, Hall, Rogers and Lipscomb each received
awards of stock options covering 21,702 shares of Common Stock under an option
plan and 8,682 shares of Common Stock under the Restricted Stock Plan following
stockholder approval of these plans July 22, 1998. These directors each received
awards of stock options covering 1,698 shares of Common Stock under a 1994
option plan. All awards are earned at the rate of 20% one year after the date of
grant and 20% annually thereafter. All awards become immediately 100% vested
upon death, disability, or termination of service following a change in control
as defined in the plans.
Executive Compensation
The Company has no full time employees, but relies on the employees of
the Bank for the limited services required by the Company. All compensation paid
to officers and employees is paid by the Bank.
Compensation Committee Interlocks and Insider Participation
For the fiscal year ended June 30, 1999, the compensation committee
consisted of directors Barham, Barnes, Hall, Haseltine, Lipscomb, Rogers and
Tripp. This standing committee reviews performance, industry salary surveys and
the
6
<PAGE>
recommendations of management concerning compensation. Mr. James E. Haseltine is
the President and Chief Executive Officer of the Bank and the Company. Mr.
Haseltine does not participate in compensation committee matters involving his
compensation. The Bank holds a loan originated in March 1987 that is secured by
a mortgage on the residence of Mr. Haseltine. Mr. Haseltine paid reduced
origination and application fees for the loan, a Bank policy applicable at that
time to all employees and directors. During the 1999 fiscal year, the largest
balance on this loan was $62,466 and the interest rate was 7.0%. Mr. Jack L.
Barham is the Chairman of the Board of Directors of the Company and the Bank and
had been, for many years until his retirement in 1995, an officer of the Bank.
Compensation Committee Report on Executive Compensation
The Compensation Committee of the Bank, with the Board of Directors,
has designed the compensation and benefit plans for all employees, executive
officers and directors in order to attract and retain individuals who have the
skills, experience and work ethic to provide a coordinated work force that will
effectively and efficiently carry out the policies adopted by the Board of
Directors and to manage the Company and its subsidiary to meet the Company's
mission, goals and objectives.
To determine the compensation and benefit plans of employees, executive
officers and directors, the committee sets salary ranges for each senior
officer, and fees for the Board of Directors. Management then determines, and is
responsible to the Compensation Committee for salary ranges for junior level
officers and staff. The Committee then reviews (i) the financial performance of
the bank over the most recently completed fiscal year (including ROA, ROE, G & A
expense, CAMELS rating, quality of assets, risk exposure and compliance rating)
compared to results at comparable companies within the industry, and (ii) the
responsibilities and performance of each senior officer and the compensation
levels of each officer compared to the compensation levels of persons with
similar duties and responsibilities at comparable companies within the industry.
The Compensation Committee evaluates all factors subjectively in the sense that
they do not attempt to tie any factors to a specific level of compensation.
All employees and officers participate on an equal, non-discriminatory
basis in the Bank's medical insurance plan, long-term disability plan and group
life insurance plan. The Bank also provides all employees and officers with the
opportunity to participate in the Employee Stock Ownership Plan (ESOP), and a
non-contributory 401 (k) tax-deferred savings plan. In 1997, the Bank
discontinued use of a cash bonus plan. The Compensation Committee of the Bank
recommends all compensation and benefit plans to the full Board for approval
annually.
Stock Option Plan and Restricted Stock Award Plan. The 1998 Stock
Option Plan and the Restricted Stock Plan (RSP) were designed to reward Board
members and senior officers for the future long-term performance of the Company,
based on the responsibilities of the Board and senior officers to manage the
Bank and the Company. The stock plans were approved by stockholders at a special
meeting held July 22, 1998, and distribution of the plans was as listed in the
Proxy Statement. The Committee and the Board of Directors believe the 1998
awards provide adequate incentives to recipients.
Report of Chief Executive Officer Compensation. The CEO's compensation
is based on the same factors as those applied to other officers and employees,
however, more emphasis is placed on the general health of the Bank and the
Company, and their financial performance. In 1997, the Board of Directors ended
a practice of paying an annual cash bonus to all officers and employees based on
return on assets. Salaries were adjusted for 1998 to account for elimination of
the bonus plan. The CEO's salary was increased by 8.8% to reflect an .88% return
on assets. Prospectively, the compensation package will reflect a range based on
like-sized, like-position comparables within the industry and the geographical
region, tempered by the performance of the individual and the Company. Stock
awards under the SOP and RSP plans provide incentive, but should not replace, or
override, maintenance of the compensation range established from the
comparables.
THE COMPENSATION COMMITTEE
Jack Barham Wayne Barnes George Hall James Haseltine Gary Lipscomb Ivy
Rogers Raymond Tripp
7
<PAGE>
Summary Compensation Table
The following table sets forth the cash and non-cash compensation
awarded to or earned by the chief executive officer. No other executive officer
of either the Bank or the Company had a salary and bonus during the fiscal years
ended June 30, 1999, 1998 or 1997 that exceeded $100,000 for services rendered
in all capacities to the Bank or the Company.
<TABLE>
<CAPTION>
==============================================================================================================================
Annual Compensation Long-Term Compensation
------------------------------------- -------------------------------------------------------
Awards Payouts
--------------------------- -------------------------
Fiscal
Name and Year Other Annual Restricted Securities All Other
Principal Ended Compensation Stock Underlying LTIP Compensation
Position June 30, Salary Bonus (1) Awards Options Payouts
- ------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
James E. 1999 $106,802 $ -- $ 12,609 $287,683(2) 41,560 - $ 19,983(3)
Haseltine 1998 100,814 8,600 9,990 - - - -
President & 1997 96,250 6,510 11,329 - - - $ 11,380(4)
CEO
==============================================================================================================================
</TABLE>
(1) Includes Directors' fees for Mr. Haseltine of $9,000 for the years ended
June 30, 1999, 1998 and 1997 in addition to an automobile allowance.
(2) The Bank granted to Mr. Haseltine 21,405 shares of Common Stock during the
fiscal year ended June 30, 1999. As of the date awarded, the shares were
valued at $13.44 per share. Such shares vest at a rate of 20% per year with
the first installment vesting on July 22, 1999. Dividends are paid on
restricted stock after awards vest. As of June 30, 1999, Mr. Haseltine had
23,852 shares of restricted stock, which had a value of $280,261 (based on
a closing price of $11.75 on June 30, 1999).
(3) Consists of an allocation of 1,709.73 shares of Common Stock under the
ESOP. The stock price per share on the date of allocation was $11.6875.
(4) Consists of the Bank's accruals pursuant to a pension plan. The plan was
subsequently terminated.
Employment Agreements
The Bank has entered into employment agreements with James E.
Haseltine, President and Chief Executive Officer and other executive officers of
the Bank. Mr. Haseltine's employment agreement covers a term of two years. The
agreements will be terminable by the Bank for "just cause" as defined in the
agreements. If the Bank terminates the employee without just cause, the employee
will be entitled to a continuation of the employee's salary from the date of
termination through the remaining term of the agreement, but in no event for a
period of less than 18 months. Mr. Haseltine's employment agreement contains a
provision stating that in the event of the termination of employment in
connection with any future change in control of the Bank, as defined in the
agreement, Mr. Haseltine will be paid a lump sum an amount equal to two times
Mr. Haseltine's five year average annual taxable compensation. Assuming
termination of employment following a change in control at the end of the 1999
calendar year, this amount would be approximately $235,000. In addition, the
Bank entered into similar employment agreements with eight other officers, which
will provide a severance payment upon termination without just cause in the
event of a change in control, as defined in the agreements. Assuming termination
of those eight officers following a change in control at the end of the 1999
calendar year, this amount would be approximately $1.06 million. The agreements
may be renewed annually by the Board of Directors upon a determination of
satisfactory performance within the Board's sole discretion.
STOCK PERFORMANCE GRAPH
Set forth below is a stock performance graph comparing the cumulative
total shareholder return on the Common Stock with (a) the cumulative total
stockholder return on stocks included in the Nasdaq Stock Market index and (b)
the cumulative total stockholder return on stocks included in the Nasdaq Bank
index, as prepared for Nasdaq by the Center for Research in
8
<PAGE>
Securities Prices ("CRSP") at the University of Chicago. All three investment
comparisons assume the investment of $100 as of the close of business on
December 30, 1997 (the date of initial issuance of the Common Stock) and the
hypothetical value of that investment as of the Company's fiscal years ended
June 30, 1999 and 1998.
[GRAPHIC OMITTED]
========================================================================
12/30/97 6/30/98 6/30/99
- ------------------------------------------------------------------------
CRSP Nasdaq U.S. Index 100.00 120.59 172.48
- ------------------------------------------------------------------------
CRSP Nasdaq Bank Index 100.00 103.99 102.75
- ------------------------------------------------------------------------
Guaranty Federal Bancshares, Inc. 100.00 101.61 95.19
========================================================================
9
<PAGE>
OPTION/SAR GRANTS IN LAST FISCAL YEAR
<TABLE>
<CAPTION>
======================================================================================================================
Individual Grants
- --------------------------------------------------------------------------------------------
Potential Realizable
Value At Assumed
Number of Securities Percent of Total Annual Rates Of Stock
Underlying Options/SARs Exercise or Price Appreciation
Options/SARs Granted to Employees Base Price Expiration For Option Term
Name Granted (#) in Fiscal Year ($/Sh) Date 5 % ($) 10% ($)
- ----------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
James E. Haseltine 41,560 9.4% $ 13.44 July 21, 2008 351,279 890,211
======================================================================================================================
</TABLE>
AGGREGATED OPTION/SAR EXERCISES AND FISCAL YEAR END
OPTION/SAR VALUES
<TABLE>
<CAPTION>
Number of Securities
Underlying Unexercised Value of Unexercised in-the-
Shares Options/SARs at FY-End Money Options/SARs at FY-
Name Acquired Value (#) Exercisable / End ($) Exercisable /
on Exercise(#) Realized($) Unexercisable Unexercisable(1)
<S> <C> <C> <C> <C> <C>
James E Haseltine 10,000 117,500 1,077 / 48,945 6,171 / 42,316
=============================================================================================================
</TABLE>
- --------------------
(1) Based on a closing market price of $11.75 per share on June 30, 1999.
Transactions with Certain Related Persons
Loans made to a director or executive officer in excess of the greater
of $25,000 or 5% of the Company's capital and surplus (up to a maximum of
$500,000) must be approved in advance by a majority of the disinterested members
of the Board of Directors. The Bank provides loans to its officers, directors,
and employees to purchase or refinance personal residences as well as consumer
loans. Loans made to officers, directors and executive officers are made in the
ordinary course of business on the same terms and conditions as would be made to
any other customer in the ordinary course of business. Prior to August 1989, all
employees, officers and directors were eligible for accommodations as to
origination and application fees. This practice was eliminated in 1989, as to
directors and executive officers. Set forth below is certain information as of
June 30, 1998, as to loans in excess of $60,000 made by the Bank, prior to 1990,
to each of its directors and executive officers and affiliates of directors and
executive officers.
<TABLE>
<CAPTION>
Original Balance at Largest
Name of Officer Date Loan June 30, Balance Since Interest Loan
or Director Originated Amount 1999 July 1, 1998 Rate Type
- ------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
James E. Haseltine March, 1987 $90,000 $60,120 $62,466 7.000% Real
Estate
- ------------------------------------------------------------------------------------------
</TABLE>
The Company intends that all transactions between the Bank and its
executive officers, directors, holders of 10% or more of the shares of any class
of its Common Stock and affiliates thereof, will contain terms no less favorable
to the Bank than could have been obtained by it in arm's-length negotiations
with unaffiliated persons and will be approved by a majority of independent
outside directors of the Bank not having any interest in the transaction.
10
<PAGE>
SECOND STOCKHOLDER PROPOSAL
RATIFICATION OF BAIRD, KURTZ & DOBSON AS
INDEPENDENT CERTIFIED PUBLIC ACCOUNTANT
Baird, Kurtz & Dobson was the Company's independent auditor for the
fiscal year ended June 30, 1999. The Board of Directors has approved the
selection of Baird, Kurtz & Dobson as auditor for the fiscal year ending June
30, 2000, subject to ratification by stockholders. If not ratified, the Board of
Directors will reconsider its selection. Ratification of the appointment of the
auditor requires the approval of a majority of the votes cast by the
stockholders of the Corporation at the meeting.
The Board of Directors recommends that stockholders vote FOR the
ratification of the appointment of Baird, Kurtz & Dobson as auditor.
A representative of Baird, Kurtz & Dobson will be present at the
Meeting. The representative will have an opportunity to make a statement, if so
desired, and will be available to respond to appropriate questions.
MISCELLANEOUS
The Board of Directors is not aware of any business to come before the
Meeting other than those matters described above in this proxy statement.
However, if any other matters should properly come before the Meeting, it is
intended that proxies in the accompanying form will be voted in respect thereof
in accordance with the judgment of the persons named in the accompanying proxy.
If the Company did not have notice of a matter on or before September 27, 1999,
it is expected that the persons named in the accompanying proxy will exercise
discretionary authority when voting on that matter.
The cost of soliciting proxies will be borne by the Company. The
Company will reimburse brokerage firms and other custodians, nominees and
fiduciaries for reasonable expenses incurred by them in sending proxy materials
to the beneficial owners of Common Stock.
The Company's Annual Report to Stockholders for the fiscal year ended
June 30, 1999, including financial statements, will be mailed on September 24,
1999, to all stockholders of record as of the close of business on September 7,
1999. Any stockholder who has not received a copy of such Annual Report may
obtain a copy by writing to the Secretary of the Company.
STOCKHOLDER PROPOSALS
In order to be eligible for inclusion in the Company's proxy materials
for next year's Annual Meeting of Stockholders, any stockholder proposal to take
action at such meeting must be received at the Company's executive offices at
1341 W.
Battlefield, Springfield, Missouri 65807-4181, no later than May 27, 2000.
In the event the Company receives notice of a stockholder proposal to
take action at next year's annual meeting of stockholders that is not submitted
for inclusion in the Company's proxy material, or is submitted for inclusion but
is properly excluded from the proxy material, the persons named in the proxy
sent by the Company to its stockholders intend to exercise their discretion to
vote on the stockholder proposal in accordance with their best judgment if
notice of the proposal is not received at the Company's main office between 60
days and 30 days prior to the meeting. If next year's annual meeting was also
held on October 27, then proposals would have to be delivered between August 28,
2000 and September 27, 2000. The Certificate of Incorporation provides that if
notice of a stockholder proposal to take action at next year's annual meeting is
not received at the Company's main office between 60 days and 30 days prior to
the meeting, the proposal will not be eligible for presentation at that meeting.
However, if less than 31 days' notice of the annual meeting is provided, a
stockholder's proposal would have to be received no later than 10 days after
notice was mailed by the Company for that meeting.
A COPY OF THE CORPORATION'S ANNUAL REPORT ON FORM 10-K FOR THE FISCAL
YEAR ENDED JUNE 30, 1999, WILL BE FURNISHED WITHOUT CHARGE TO STOCKHOLDERS AS OF
THE RECORD DATE UPON WRITTEN REQUEST TO E. LORENE THOMAS, SECRETARY, GUARANTY
FEDERAL BANCSHARES, INC., 1341 WEST BATTLEFIELD, SPRINGFIELD, MISSOURI
65807-4181.
Dated: September 24, 1999
11
<PAGE>
|X| PLEASE MARK VOTES REVOCABLE PROXY
AS IN THIS EXAMPLE GUARANTY FEDERAL BANCSHARES, INC.
ANNUAL MEETING OF STOCKHOLDERS
October 27, 1999
The undersigned hereby appoints the Board of Directors of Guaranty
Federal Bancshares, Inc. (the "Company"), or its designee, with full powers of
substitution, to act as attorneys and proxies for the undersigned, to vote all
shares of Common Stock of the Company which the undersigned is entitled to vote
at the Annual Meeting of Stockholders (the "Meeting"), to be held at the
Company's corporate office at 1341 West Battlefield, Springfield, Missouri, on
Wednesday, October 27, 1999, at 5:00 p.m., local time, and at any and all
adjournments thereof, in the following manner:
Please be sure to sign and date this Proxy below. -------------------
Date
------------------------------------ -------------------
Stockholder Co-holder (if any)
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C>
FOR ALL
FOR WITHHOLD EXCEPT
--- -------- ------
1. The election as directors of all nominees listed (except as marked to
the contrary below):
| | | | | |
Wayne V. Barnes
Ivy L. Rogers
Gregory V. Ostergren
INSTRUCTION : To withhold authority to vote for individual nominee(s),
mark "For All Except" and write the name(s) in the space provided
below.
</TABLE>
-------------------------------------------
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C>
FOR AGAINST ABSTAIN
--- ------- -------
2. The ratification of the appointment of Baird, Kurtz & Dobson as
independent auditors of the Company for the fiscal year ending June
30,
2000. | | | | | |
</TABLE>
In their discretion, such attorneys and proxies are authorized to vote upon
such other business as may properly come before the Meeting or any adjournments
thereof.
The Board of Directors recommends a vote "FOR" all of the above listed
propositions.
THIS SIGNED PROXY WILL BE VOTED AS DIRECTED, BUT IF NO INSTRUCTIONS ARE
SPECIFIED, THIS SIGNED PROXY WILL BE VOTED FOR EACH OF THE PROPOSITIONS STATED.
IF ANY OTHER BUSINESS IS PRESENTED AT SUCH MEETING, THIS SIGNED PROXY WILL BE
VOTED BY THOSE NAMED IN THIS PROXY IN THEIR BEST JUDGMENT. AT THE PRESENT TIME,
THE BOARD OF DIRECTORS KNOWS OF NO OTHER BUSINESS TO BE PRESENTED AT THE
MEETING.
THIS PROXY IS SOLICITED BY THE BOARD OF DIRECTORS.
<PAGE>
Detach above card, sign, date and mail in postage paid envelope provided.
GUARANTY FEDERAL BANCSHARES, INC.
Should the above signed be present and elect to vote at the Meeting, or
at any adjournments thereof, and after notification to the Secretary of the
Company at the Meeting of the stockholder's decision to terminate this Proxy,
the power of said attorneys and proxies shall be deemed terminated and of no
further force and effect. The undersigned may also revoke this Proxy by filing a
subsequently dated Proxy or by written notification to the Secretary of the
Company of the stockholder's decision to terminate this Proxy.
The above signed acknowledges receipt from the Company prior to the
execution of this proxy of a Notice of Meeting of Stockholders and a Proxy
Statement dated September 24, 1999.
Please sign exactly as your name appears on this Proxy. When signing as
attorney, executor, administrator, trustee or guardian, please give full title.
If shares are held jointly, each holder should sign.
PLEASE COMPLETE, DATE, SIGN AND MAIL THIS PROXY PROMPTLY
IN THE ENCLOSED POSTAGE-PREPAID ENVELOPE.
