Item 9A. Controls and Procedures
ITEM 9A. CONTROLS AND PROCEDURES
Disclosure Controls and Procedures
As of the end of the period covered by this report, an evaluation of the effectiveness of the Company’s disclosure controls and procedures (as defined in Exchange Act Rule 13a-15(e)) was performed under the supervision and with the participation of the Company’s Chief Executive Officer and Chief Financial Officer. Based on that evaluation, the Chief Executive Officer and the Chief Financial Officer have concluded that the Company’s current disclosure controls and procedures were effective to ensure that information required to be disclosed by the Company in the reports that it files or submits under the Exchange Act was recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms.
Management’s Report on Internal Control over Financial Reporting
Management of the Company is responsible for establishing and maintaining adequate internal control over financial reporting (as defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act). The Company’s internal control system is a process designed to provide reasonable assurance to the Company’s management and Board of Directors regarding the preparation and fair presentation of published financial statements.
Internal control over financial reporting of the Company includes those policies and procedures that pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions of the Company; provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the Company are being made only in accordance with authorizations of management and directors of the Company; and provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or disposition of the Company’s assets that could have a material effect on the Company’s consolidated financial statements.
Because of inherent limitations in any system of internal control, no matter how well designed, misstatements due to error or fraud may occur and not be detected, including the possibility of the circumvention or overriding of controls. Accordingly, even effective internal control over financial reporting can provide only reasonable assurance with respect to financial statement preparation. Further, because of changes in conditions, internal control effectiveness may vary over time.
Management assessed the Company’s internal control over financial reporting as of December 31, 2023. This assessment was based on criteria for effective internal control over financial reporting set forth by the Committee of Sponsoring Organizations of the Treadway Commission in Internal Control-Integrated Framework in 2013. Based on this assessment, the Chief Executive Officer and Chief Financial Officer assert that the Company maintained effective internal control over financial reporting as of December 31, 2023 based on the specified criteria.
The Company’s independent registered public accounting firm, which audited the consolidated financial statements included in this annual report, has issued an attestation report on the Company’s internal control over financial reporting as of December 31, 2023 that appears in Item 8 of this Form 10-K and is incorporated into this item by reference.
Changes in Internal Control Over Financial Reporting
There were no changes in the Company’s internal control over financial reporting (as defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act) that occurred during the fourth fiscal quarter of 2023 that have materially affected, or are reasonably likely to materially affect, the Company’s internal control over financial reporting.
ITEM 9B. OTHER INFORMATION
During the fiscal quarter ended December 31, 2023, none of the Company’s directors or executive officers adopted or terminated any contract, instruction or written plan for the purchase or sale of Company securities that was intended to satisfy the affirmative defense conditions of Rule 10b5-1(c) or any “non-Rule 10b5-1 trading arrangement.”
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ITEM 9C. DISCLOSURE REGARDING FOREIGN JURISDICTIONS THAT PREVENT INSPECTION
Not applicable.
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PART III
ITEM 10. DIRECTORS, EXECUTIVE OFFICERS, AND CORPORATE GOVERNANCE
The information for directors and executive officers as required pursuant to Item 401 of Regulation S-K can be found under the captions “Proposal 1. Election of Directors” and “Governance and Board of Directors—Executive Officers of the Company” in the Company’s definitive Proxy Statement on Form DEF 14A, which will be filed with the SEC on or before March 5, 2024, and is incorporated herein by reference.
Code of Ethics
We have a Code of Conduct in place that applies to all of our directors, officers and employees. The Code of Conduct sets forth the standard of ethics that we expect all of our directors, officers and employees to follow, including our Chief Executive Officer and Chief Financial Officer. The Code of Conduct may be viewed on the Company’s website (www.westbankstrong.com) under Investor Relations — Overview — Corporate Governance. We intend to satisfy the disclosure requirements under Item 5.05 of Form 8-K regarding any amendment to or waiver of the Code of Conduct with respect to our Chief Executive Officer and Chief Financial Officer, and persons performing similar functions, by posting such information on our website.
Stockholder Recommendations for Nominees to the Board of Directors
The information required pursuant to Item 407(c)(3) of Regulation S-K can be found under the caption “General Matters—2025 Stockholder Proposals” in the Company’s definitive Proxy Statement on Form DEF 14A, which will be filed with the SEC on or before March 5, 2024, and is incorporated herein by reference.
Identification of Audit Committee and Audit Committee Financial Expert
The Company has a standing Audit Committee that consists of Steven T. Schuler, Chair, James W. Noyce, Rosemary Parson and Therese M. Vaughan. The Board has determined that Mr. Schuler, Mr. Noyce and Dr. Vaughan are audit committee financial experts. The full Board has determined that all members of the Audit Committee are independent directors.
ITEM 11. EXECUTIVE COMPENSATION
The information required pursuant to Item 402, Item 407(e)(4) and Item 407(e)(5) of Regulation S-K can be found under the captions “Governance and Board of Directors—Director Compensation” and “Executive Compensation” in the Company’s definitive Proxy Statement on Form DEF 14A, which will be filed with the SEC on or before March 5, 2024, and is incorporated herein by reference.
ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS
Effective as of the 2021 annual meeting of stockholders, the West Bancorporation, Inc. 2021 Equity Incentive Plan (2021 Plan) was adopted by the Board of Directors and approved by our stockholders. The prior 2017 Equity Incentive Plan (2017 Plan) was frozen with respect to future grants upon approval of the 2021 Plan. At the time the 2017 Plan was frozen, 196,535 shares had not been issued under the original authorization for that plan. Awards outstanding under the 2017 Plan will remain subject to the 2017 Plan as long as they remain outstanding. Under the terms of the 2021 Plan, the Company may grant a total of 625,000 shares of the Company’s common stock as nonqualified and incentive stock options, stock appreciation rights and stock awards. All employees and directors of the Company and its subsidiary are eligible to become participants in the 2021 Plan. Additional information regarding our equity incentive plans is presented in “Note 13. Stock Compensation Plans” in the notes to the consolidated financial statements pursuant to Item 8. The following table sets forth information regarding outstanding restricted stock units and shares available for future issuance under these plans as of December 31, 2023.
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Plan Category Number of shares to be issued upon exercise of outstanding options, warrants and rights (a) Weighted-average exercise price of outstanding options, warrants and rights (b) Number of shares remaining available for future issuance under equity compensation plans (excluding shares reflected in column (a)) (c)
Equity compensation plans approved by stockholders (1)
479,480 — 266,963 ` (2)
Equity compensation plans not approved by stockholders — — —
Total 479,480 — 266,963
(1) Includes the West Bancorporation, Inc. 2017 Equity Incentive Plan approved by stockholders on April 27, 2017, and the West Bancorporation, Inc. 2021 Equity Incentive Plan approved by stockholders on April 29, 2021.
(2) Reflects the number of shares available for issuance under the West Bancorporation, Inc. 2021 Equity Incentive Plan as nonqualified and incentive stock options, stock appreciation rights and stock awards.
The information required pursuant to Item 403 of Regulation S-K can be found under the captions “Governance and Board of Directors—Security Ownership of Certain Beneficial Owners and Executive Officers,” “Governance and Board of Directors—Other Beneficial Owners” and “Governance and Board of Directors—Changes in Control” in the Company’s definitive Proxy Statement on Form DEF 14A, which will be filed with the SEC on or before March 5, 2024, and is incorporated herein by reference.
ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE
The information required pursuant to Item 404 and Item 407(a) of Regulation S-K can be found under the captions “Governance and Board of Directors” and “General Matters—Certain Relationships and Related Transactions” in the Company’s definitive Proxy Statement on Form DEF 14A, which will be filed with the SEC on or before March 5, 2024, and is incorporated herein by reference.
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ITEM 14. PRINCIPAL ACCOUNTANT FEES AND SERVICES
The information required pursuant to Item 9(e) of Schedule 14A can be found under the caption “Proposal 5. Ratify the Appointment of Independent Registered Public Accounting Firm” in the Company’s definitive Proxy Statement on Form DEF 14A, which will be filed with the SEC on or before March 5, 2024, and is incorporated herein by reference. The PCAOB ID Number for our Independent Registered Public Accounting Firm is 49 .
PART IV
ITEM 15. EXHIBITS AND FINANCIAL STATEMENT SCHEDULES
The following exhibits and financial statement schedules of the Company are filed as part of this report:
(a) 1. Financial Statements
The consolidated financial statements that appear in Item 8 of this Form 10-K are incorporated herein by reference.
Page
Report of Independent Registered Accounting Firm (PCAOB ID 49)
53
Consolidated Balance Sheets as of December 31, 2023 and 2022 56
Consolidated Statements of Income for the years ended December 31, 2023, 2022 and 2021 57
Consolidated Statements of Comprehensive Income for the years ended December 31, 2023, 2022 and 2021 58
Consolidated Statements of Stockholders’ Equity for the years ended December 31, 2023, 2022 and 2021 59
Consolidated Statements of Cash Flows for the years ended December 31, 2023, 2022 and 2021 60
Notes to Consolidated Financial Statements 61
2. Financial Statement Schedules
All schedules are omitted because they are not applicable, not required, or because the required information is included in the consolidated financial statements or notes thereto.
3. Exhibits (not covered by independent registered public accounting firms’ reports)
3.1 Restatement of the Restated Articles of Incorporation of West Bancorporation, Inc. ( incorporated herein by reference to Exhibit 3.1 filed with the Form 10-K on March 1, 2017 )
3.2 Amended and Restated Bylaws of West Bancorporation, Inc. as of January 23, 2019 ( incorporated herein by reference to Exhibit 3.1 filed with the Form 8-K on January 24, 2019 )
4.1 Description of Capital Stock ( incorporated herein by reference to Exhibit 4 filed with the Form 10-K on February 27, 2020 )
4.2 Indenture, dated June 14, 2022, between West Bancorporation, Inc. and Wilmington Trust, National Association, as trustee ( incorporated herein by reference to Exhibit 4.1 filed with the Form 8-K on June 14, 2022 )
4.3 First Supplemental Indenture, dated June 14, 2022, between West Bancorporation, Inc. and Wilmington Trust, National Association, as trustee ( incorporated herein by reference to Exhibit 4.2 filed with the Form 8-K on June 14, 2022 )
4.4 Form of 5.25% Fixed-to-Floating Rate Subordinated Notes due 2032 ( incorporated herein by reference to Exhibit 4.3 filed with the Form 8-K on June 14, 2022 )
10.1* Employment Agreement dated July 23, 2012, between West Bancorporation, Inc. and David D. Nelson ( incorporated herein by reference to Exhibit 10.1 filed with the Form 8-K on July 25, 2012 )
10.2* Employment Agreement dated July 23, 2012, between West Bancorporation, Inc. and Brad L. Winterbottom ( incorporated herein by reference to Exhibit 10.2 filed with the Form 8-K on July 25, 2012 )
10.3* Employment Agreement dated July 23, 2012, between West Bancorporation, Inc. and Harlee N. Olafson ( incorporated herein by reference to Exhibit 10.3 filed with the Form 8-K on July 25, 2012 )
10.4* Transitional Employment Agreement dated May 27, 2021, between West Bancorporation, Inc. and Douglas R. Gulling ( incorporated herein by reference to Exhibit 10.1 filed with the Form 8-K on May 27, 2021 )
10.5* Employment Agreement dated April 29, 2021 between West Bancorporation, Inc. and Bradley P. Peters ( incorporated herein by reference to Exhibit 10.2 filed with the Form 8-K on April 30, 2021 )
10.6* Employment Agreement dated May 27, 2021 between West Bancorporation, Inc. and Jane M. Funk ( incorporated herein by reference to Exhibit 10.2 filed with the Form 8-K on May 27, 2021 )
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10.7* West Bancorporation, Inc. Deferred Compensation Plan ( incorporated herein by reference to Exhibit 10.1 filed with the Form 8-K on October 29, 2012 )
10.8* West Bancorporation, Inc. Employee Savings and Stock Ownership Plan, as amended ( incorporated herein by reference to Exhibit 10.20 filed with the Form 10-K on March 6, 2014 )
10.9* Amendment No. 1 to West Bancorporation, Inc. Employee Savings and Stock Ownership Plan, Effective January 1, 2015 ( incorporated herein by reference to Exhibit 10.1 filed with the Form 10-Q/A on August 11, 2020 )
10.10* Amendment No. 2 to West Bancorporation, Inc. Employee Savings and Stock Ownership Plan, Effective January 1, 2016 ( incorporated herein by reference to Exhibit 10.2 filed with the Form 10-Q/A on August 11, 2020 )
10.11* Amendment No. 3 to West Bancorporation, Inc. Employee Savings and Stock Ownership Plan, Effective January 1, 2018 ( incorporated herein by reference to Exhibit 10.3 filed with the Form 10-Q/A on August 11, 2020 )
10.12* Interim Amendment to West Bancorporation, Inc. Employee Savings and Stock Ownership Plan, Effective April 1, 2018 ( incorporated herein by reference to Exhibit 10.4 filed with the Form 10-Q/A on August 11, 2020 )
10.13* West Bancorporation, Inc. 2017 Equity Incentive Plan ( incorporated herein by reference to Exhibit A of the definitive proxy statement on Schedule 14A filed on March 1, 2017 )
10.14* Form of Restricted Stock Unit Award Agreement under the West Bancorporation, Inc. 2017 Equity Incentive Plan ( incorporated herein by reference to Exhibit 4.2 filed with the Form S-8 on April 28, 2017 )
10.15* Form of Restricted Stock Award Agreement under the West Bancorporation, Inc. 2017 Equity Incentive Plan ( incorporated herein by reference to Exhibit 4.3 filed with the Form S-8 on April 28, 2017 )
10.16* Form of Nonqualified Stock Option Award Agreement under the West Bancorporation, Inc. 2017 Equity Incentive Plan ( incorporated herein by reference to Exhibit 4.4 filed with the Form S-8 on April 28, 2017 )
10.17* Form of Incentive Stock Option Award Agreement under the West Bancorporation, Inc. 2017 Equity Incentive Plan ( incorporated herein by reference to Exhibit 4.5 filed with the Form S-8 on April 28, 2017 )
10.18* Form of Stock Appreciation Right Award Agreement under the West Bancorporation, Inc. 2017 Equity Incentive Plan ( incorporated herein by reference to Exhibit 4.6 filed with the Form S-8 on April 28, 2017 )
10.19* Form of Restricted Stock Unit Award Agreement under the West Bancorporation, Inc. 2017 Equity Incentive Plan ( incorporated herein by reference to Exhibit 10.19 filed with the Form 10-K on March 1, 2021 )
10.20* Form of Performance Based Restricted Stock Unit Award Agreement under the West Bancorporation, Inc. 2017 Equity Incentive Plan ( incorporated herein by reference to Exhibit 10.20 filed with the Form 10-K on March 1, 2021 )
10.21 Amended and Restated Lease Agreement Dated February 20, 2018 (incorporated herein by reference to Exhibit 10.16 filed with the Form 10-K on March 1, 2018)
10.22* West Bancorporation Inc. 2021 Equity Incentive Plan ( incorporated herein by reference to Exhibit A to the Company’s definitive proxy statement filed with the Securities and Exchange Commission on March 1, 2021 )
10.23* Form of West Bancorporation, Inc. 2021 Equity Incentive Plan Restricted Stock Unit Award Agreement (with holding period) ( incorporated herein by reference to Exhibit 4.4 filed with the Form S-8 on April 30, 2021 )
10.24* Form of West Bancorporation, Inc. 2021 Equity Incentive Plan Restricted Stock Unit Award Agreement (without holding period) ( incorporated herein by reference to Exhibit 4.5 filed with the Form S-8 on April 30, 2021 )
10.25* Form of West Bancorporation, Inc. 2021 Equity Incentive Plan Performance-Based Restricted Stock Unit Award Agreement ( incorporated herein by reference to Exhibit 4.6 filed with the Form S-8 on April 30, 2021 )
10.26* Form of West Bancorporation, Inc. 2021 Equity Incentive Plan Cash-Settled Restricted Stock Unit Award Agreement ( incorporated herein by reference to Exhibit 4.7 filed with the Form S-8 on April 30, 2021 )
10.27* Form of West Bancorporation, Inc. 2021 Equity Incentive Plan Director Restricted Stock Unit Award Agreement ( incorporated herein by reference to Exhibit 4.8 filed with the Form S-8 on April 30, 2021 )
10.28 Credit Agreement, dated as of December 15, 2021, by and between West Bancorporation, Inc. and National Exchange Bank & Trust ( incorporated herein by reference to Exhibit 10.1 filed with the Form 8-K on June 6, 2022 )
10.29 Promissory Note, dated as of December 15, 2021, made by West Bancorporation, Inc., to and in favor of National Exchange Bank & Trust ( incorporated herein by reference to Exhibit 10.2 filed with the Form 8-K on June 6, 2022 )
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10.30 Commercial Pledge Agreement, dated as of December 15, 2021, by and between West Bancorporation, Inc. and National Exchange Bank & Trust ( incorporated herein by reference to Exhibit 10.3 filed with the Form 8-K on June 6, 2022 )
10.31* Addendum to Transitional Employment Agreement, dated September 7, 2022, between West Bancorporation, Inc. and Douglas R. Gulling ( incorporated herein by reference of Exhibit 10.31 filed with the Form 10-K on February 23, 2023 )
21 Subsidiaries
23 Consent of Independent Registered Public Accounting Firm
31.1 Certification of Chief Executive Officer under Section 302 of the Sarbanes-Oxley Act of 2002
31.2 Certification of Chief Financial Officer under Section 302 of the Sarbanes-Oxley Act of 2002
32.1 Certification of Chief Executive Officer Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
32.2 Certification of Chief Financial Officer Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
97.1 West Bancorporation, Inc. Clawback Policy
101.INS Inline XBRL Instance Document - the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document
101.SCH Inline XBRL Taxonomy Extension Schema Document
101.CAL Inline XBRL Taxonomy Extension Calculation Linkbase Document
101.DEF Inline XBRL Taxonomy Extension Definition Linkbase Document
101.LAB Inline XBRL Taxonomy Extension Label Linkbase Document
101.PRE Inline XBRL Taxonomy Extension Presentation Linkbase Document
104 Cover Page Interactive Data File (formatted as Inline XBRL and combined in Exhibit 101)
* Indicates management contract or compensatory plan or arrangement.
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ITEM 16. FORM 10-K SUMMARY
None.
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SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
WEST BANCORPORATION, INC.
(Registrant)
February 22, 2024 By: /s/ David D. Nelson
David D. Nelson
Chief Executive Officer and President
Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated.
February 22, 2024 By: /s/ David D. Nelson
David D. Nelson
Chief Executive Officer, Director and President
(Principal Executive Officer and Director)
February 22, 2024 By: /s/ Jane M. Funk
Jane M. Funk
Executive Vice President, Treasurer and Chief Financial Officer
(Principal Financial Officer)
BOARD OF DIRECTORS
February 22, 2024 By: /s/ James W. Noyce
James W. Noyce
Chairman of the Board
February 22, 2024 By: /s/ Patrick J. Donovan
Patrick J. Donovan
February 22, 2024 By: /s/ Lisa J. Elming
Lisa J. Elming
February 22, 2024 By: /s/ Steven K. Gaer
Steven K. Gaer
February 22, 2024 By: /s/ Douglas R. Gulling
Douglas R. Gulling
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February 22, 2024 By: /s/ Sean P. McMurray
Sean P. McMurray
February 22, 2024 By: /s/ George D. Milligan
George D. Milligan
February 22, 2024 By: /s/ Rosemary Parson
Rosemary Parson
February 22, 2024 By: /s/ Steven T. Schuler
Steven T. Schuler
February 22, 2024 By: /s/ Therese M. Vaughan
Therese M. Vaughan
February 22, 2024 By: /s/ Philip Jason Worth
Philip Jason Worth
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