Item 5.02. Departure of Directors or Certain Officers; Election of Directors;
Appointment of Certain Officers; Compensatory Arrangements of Certain
Officers.
Compensatory Arrangement of President and Chief Executive Officer
On June 25, 2022, Bank of Guam (the "Bank"), a subsidiary of BankGuam Holding
Company (the "Company"), entered into a new Employment Agreement with
Mr. Joaquin P.L.G. Cook, effective April 1, 2022 with an expiration date of
March 31, 2027, as the Bank's President and Chief Executive Officer. The
Employment Agreement provides for, among other things, an annual base salary of
$375,000 with annual CPI adjustments. The Employment Agreement also provides for
a quarterly incentive bonus opportunity equal to 2% of the net profits after
taxes of the Bank, up to $400,000 per year, subject to review and possible
adjustments by the Bank Board of Directors every other year. The incentive bonus
shall be reduced by 10% or 15% if the Bank does not meet certain objectives,
which are set forth in the Employment Agreement, as measured by return on
assets, return on equity, level of adversely classified assets to Tier 1 capital
and allowance for loan and lease losses, and the Bank's efficiency ratio. The
Employment Agreement also provides certain personal benefits which include (a) a
group term life insurance policy in the amount of $700,000 maintained by the
Bank, (b) use of an automobile and compensation for operating expenses, and
(c) the right to participate in the Bank's group health insurance, accident
insurance and disability insurance plans. Upon permanent disability, Mr. Cook
would receive his base salary adjusted for CPI increases, together with all
incentive bonuses, for the remainder of the term of his Employment Agreement.
The Employment Agreement also provides for a Survivor Income Plan with a death
benefit of $1,060,606 and a Supplemental Executive Retirement Plan ("SERP")
which pays out for a period of 15 years the amount of $150,000 per annum after
10 years from the date of the SERP contract, at the Bank's sole expense and
cost. In the event of disability, the Bank is obligated to pay in 180 monthly
payments 100% of the accrual balance, as defined in the SERP agreement. The
agreements are expected to begin paying out at the executive's normal retirement
date when defined in the SERP agreement on the first day of the month following
determination of disability. In the event of a change in control, the Bank is
obligated to pay within 60 days of separation 100% of the accrual balance, as
defined in the SERP agreement. In addition, in the event of a termination by the
executive for "good reason" (as defined in the Employment Agreement) or by the
Bank for any reason other than "cause" (as defined in the Employment Agreement),
the Employment Agreement provides for continued payment of the amounts that
would have been paid under the Employment Agreement for the remainder of the
term.
Compensatory Arrangement of Executive Vice President and Chief Operating
Officer.
On June 25, 2022, the Bank entered into a new Employment Agreement with
Ms. Maria Eugenia H. Leon Guerrero, effective April 1, 2022 with an expiration
date of March 31, 2027, as the Bank's Executive Vice President and Chief
Operating Officer. The Employment Agreement provides for, among other things, an
annual base salary of $365,000 with annual CPI adjustments. The Employment
Agreement also provides for a quarterly incentive bonus opportunity equal to 2%
of the net profits after taxes of the Bank, up to $400,000 per year. The
incentive bonus shall be reduced by 10% or 15% if the Bank does not meet certain
objectives, which are set forth in the Employment Agreement, as measured by
return on assets, return on equity, level of adversely classified assets to Tier
1 capital and allowance for loan and lease losses, and the Bank's efficiency
ratio. The Employment Agreement also provides for certain other personal
benefits including (a) a group term life insurance policy in the amount of
$700,000 maintained by the Bank, (b) use of an automobile and compensation for
operating expenses, and (c) the right to participate in the Bank's group health
insurance, accident insurance and disability insurance plans. Upon disability,
Ms. Leon Guerrero would receive her base salary, adjusted for the CPI increases,
together with all incentive bonuses for the remainder of the term of her
Employment Agreement. The Employment Agreement also provides for a Survivor
Income Plan with a death benefit of $1,060,606 and a SERP which pays out for a
period of 15 years the amount of $150,000 per annum after 10 years from the date
of the SERP contract, at the Bank's sole expense and cost. In the event of
disability, the Bank is obligated to pay in 180 monthly payments 100% of the
accrual balance, as defined in the SERP agreement. The agreements are expected
to begin paying out at the executive's normal retirement date when defined in
the SERP agreement on the first day of the month following determination of
disability. In the event of a change in control, the Bank is obligated to pay
within 60 days of separation 100% of the accrual balance, as defined in the SERP
agreement. In addition, in the event of a termination by the executive for "good
reason" (as defined in the Employment Agreement) or by the Bank for any reason
other than "cause" (as defined in the Employment Agreement), the Employment
Agreement provides for continued payment of the amounts that would have been
paid under the Employment Agreement for the remainder of the term.
--------------------------------------------------------------------------------
© Edgar Online, source Glimpses
BANKGUAM HOLDING COMPANY 
