alrs20250319_def14a.htm

March 28, 2025

Notice of Annual
Meeting of Stockholders

401 Demers Avenue
Grand Forks, North Dakota 58201

TIME & DATE

RECORD DATE

Thursday, May 8, 2025

1:30 p.m., Central Time

Virtually at

https://web.lumiconnect.com/288140204

Wednesday, March 12, 2025

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

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


Filed by the Registrant ☒
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))
☒	Definitive Proxy Statement
☐	Definitive Additional Materials
☐	Soliciting Material under §240.14a‑12

ALERUS FINANCIAL CORPORATION
(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):

☒	No fee required.
☐	Fee paid previously with preliminary materials.
☐	Fee computed on table in exhibit required by Item 25(b) per Exchange Act Rules 14a6(i)(1) and 0-11.

NOTICE IS HEREBY GIVEN that the annual meeting of stockholders of Alerus Financial Corporation (the “Company”) will be conducted through virtual means only via live webcast. The annual meeting will take place on Thursday, May 8, 2025, at 1:30 p.m., Central Time.

At the annual meeting, stockholders will be asked to:

	1		2		3		4		5		6


Elect the nine director nominees named in the accompanying proxy statement to serve on the board of directors of the Company;		Approve, on a non-binding advisory basis, the compensation paid to our named executive officers;		Approve, on a non-binding advisory basis, how often we will hold future advisory votes on the compensation paid to our named executive officers;		Ratify the appointment of RSM US LLP as the registered independent public accounting firm for the Company for the fiscal year ending December 31, 2025;		Approve an amendment to the Company’s Third Amended and Restated Certificate of Incorporation to increase the number of authorized shares of Company common stock authorized for issuance; and		Transact such other business as may properly be brought before the annual meeting or any adjournments or postponements of the meeting.

Only stockholders of record as of the close of business on March 12, 2025, will be entitled to notice of, and to vote at, the annual meeting. If there are an insufficient number of votes for a quorum, the meeting may be adjourned or postponed to permit us to continue to solicit proxies.

We are using the Securities and Exchange Commission rule that allows us to furnish our proxy statement, Annual Report on Form 10‑K for the year ended December 31, 2024, and proxy card to stockholders over the internet. This means our stockholders will receive only a notice containing instructions on how to access proxy materials over the internet. This proxy statement, our Annual Report on Form 10-K for the year ended December 31, 2024, and the proxy card are available at investors.alerus.com and http://www.astproxyportal.com/ast/19579/. If you receive the notice but would still like to request paper copies of the proxy materials, please follow the instructions on the notice. By delivering proxy materials electronically to our stockholders, we can reduce the costs of printing and mailing our proxy materials. This notice is first being mailed to stockholders, and we intend to provide access to the proxy materials to the stockholders of record, beginning on or about March 28, 2025.

Stockholders can participate in and vote during the annual meeting by visiting https://web.lumiconnect.com/288140204 and entering (i) passcode: alerus2025; and (ii) the unique 11-digit control number found on the proxy card distributed to each stockholder entitled to vote as of the close of business on the record date. Stockholders may also ask questions during the annual meeting by following the instructions available on the meeting website.

Grand Forks, North Dakota
March 28, 2025

By Order of the Board of Directors

Katie A. Lorenson

President and Chief Executive Officer

YOUR VOTE IS VERY IMPORTANT. PLEASE EXERCISE YOUR STOCKHOLDER RIGHT TO VOTE, REGARDLESS OF
WHETHER YOU PLAN TO ATTEND THE VIRTUAL ANNUAL MEETING.


	Table of Contents
	Questions and Answers	3
	Proposal 1 — Election of Directors	7
	Corporate Governance and the Board of Directors	13
	Compensation Discussion and Analysis	21
	Compensation Committee Report	29
	Executive Compensation	30
	CEO Pay Ratio	34
	Pay Versus Performance	35
	Security Ownership of Certain Beneficial Owners	38
	Certain Relationships and Related Party Transactions	40
	Proposal 2 — Non-binding Advisory Vote on Executive Officer Compensation	41
	Proposal 3 — Non-binding Advisory Vote on the Frequency of Future Stockholder Advisory Votes on Named Executive Officer Compensation	42
	Proposal 4 — Ratification of the Appointment of RSM US LLP as our Independent Registered Public Accounting Firm	43
	Audit Committee Report	45
	Proposal 5 — Amendment to the Company’s Charter to Increase Authorized Shares of Common Stock	46

ALERUS FINANCIAL CORPORATION

PROXY STATEMENT

Annual Meeting of Stockholders

May 8, 2025

This proxy statement (this “Proxy Statement”) is furnished in connection with the solicitation by the board of directors (the “Board”) of Alerus Financial Corporation (the “Company”) of proxies to be voted at the annual meeting of stockholders (the “Annual Meeting”) to be held through virtual means only via live webcast on Thursday, May 8, 2025, at 1:30 p.m. (Central Time), and at any adjournments or postponements of the Annual Meeting. A complete list of the stockholders entitled to vote at the Annual Meeting will be available for inspection upon request of any stockholder, for a purpose germane to the Annual Meeting, at the Company’s principal executive offices, located at 401 Demers Avenue, Grand Forks, North Dakota 58201, for the ten days prior to the meeting, during ordinary business hours, and also during the Annual Meeting. We are holding the Annual Meeting virtually only. As always, we encourage you to vote your shares prior to the Annual Meeting.

The Company is a Delaware corporation headquartered in Grand Forks, North Dakota. The Company is a registered financial holding company, which owns all the issued and outstanding capital stock of Alerus Financial, National Association, a national banking association with its main office also located in Grand Forks, North Dakota (the “Bank”).

IMPORTANT NOTICE REGARDING THE AVAILABILITY OF PROXY MATERIALS FOR THE ANNUAL MEETING TO BE HELD ON MAY 8, 2025:

We are using the Securities and Exchange Commission (“SEC”) rule that allows us to furnish our Proxy Statement, Annual Report on Form 10-K for the year ended December 31, 2024 and proxy card to stockholders over the internet. This means our stockholders will receive only a notice containing instructions on how to access proxy materials over the internet. If you receive the notice but would still like to request paper copies of the proxy materials, please follow the instructions on the notice. This Proxy Statement and the accompanying proxy card are first being made available to stockholders on or about March 28, 2025.

Our Proxy Statement and Annual Report on Form 10‑K for the year ended December 31, 2024 are available online at investors.alerus.com and at http://www.astproxyportal.com/ast/19579/.

Questions and Answers

The following is information regarding the Annual Meeting and voting process, presented in a question and answer format.

Why did I receive a notice regarding the internet availability of proxy materials instead of paper copies of the proxy materials?

We are using the SEC’s notice and access rule that allows us to furnish our proxy materials over the internet to our stockholders instead of mailing paper copies of those materials to each stockholder. As a result, beginning on or about March 28, 2025, we sent our stockholders by mail a notice containing instructions on how to access our proxy materials over the internet and vote. This notice is not a proxy card and cannot be used to vote your shares. If you received a notice this year, you will not receive paper copies of the proxy materials unless you request paper copies of the proxy materials by following the instructions on the notice.

Why are we holding a virtual meeting instead of a physical meeting?

Our Board determined that it would be in the best interests of our stockholders for the Company to hold the Annual Meeting virtually only rather than in person. We believe that hosting a virtual meeting will enable more of our stockholders to attend the meeting because it will allow our stockholders to participate from any location around the world with internet access.

How do I virtually attend the Annual Meeting?

The Annual Meeting will be a completely virtual meeting of stockholders, which will be conducted exclusively by live webcast. You are entitled to participate in the Annual Meeting only if you were a stockholder of record as of the close of business on the record date for the Annual Meeting, March 12, 2025 (the “Record Date”), or if you hold a valid proxy for the Annual Meeting. There is no physical location for the Annual Meeting. You will be able to attend the Annual Meeting online, vote and submit your questions during the meeting by visiting https://web.lumiconnect.com/288140204 and entering (i) the passcode alerus2025; and (ii) the unique 11-digit control number found on the proxy card distributed to each stockholder as of the close of business on the Record Date. If you are not a stockholder of record but hold shares as a beneficial owner in street name, you should follow the instructions for attending the Annual Meeting provided by your broker or other fiduciary. If you do not comply with the procedures outlined above, you will not be admitted to the virtual Annual Meeting. Online check-in will start shortly before the meeting, which will begin promptly at 1:30 p.m. Central Time on May 8, 2025. The virtual meeting platform is fully supported across major browsers (Microsoft Edge, Firefox, Chrome, and Safari) and devices (desktops, laptops, tablets, and cell phones) running the most updated version of applicable software and plugins. Participants should ensure that they have a strong internet connection wherever they intend to participate in the meeting. Participants should also give themselves plenty of time to log-in and ensure that they can hear streaming audio prior to the start of the meeting. A technical support number will be made available on the webpage during check-in for stockholders who experience technical difficulties accessing the virtual Annual Meeting. A complete list of the stockholders entitled to vote at the Annual Meeting will be made available for inspection by clicking the designated stockholder list link that will appear on your screen. The stockholder list may be accessed at any time during the meeting or any adjournment.

How do I ask questions at the Annual Meeting?

In order to submit a question at the Annual Meeting, you will need to log into https://web.lumiconnect.com/288140204 and enter (i) the passcode: alerus2025; and (ii) the unique 11-digit control number found on the proxy card distributed to each record stockholder. If you would like to ask a question during the meeting, you can type in your question in the “ask a question” text box that will appear on your screen and click “submit.” We encourage you to submit any questions as soon as possible to ensure your question is received.

Why did I receive access to this Proxy Statement and proxy card?

We have made the proxy materials available to you over the internet because, as of the close of business on the Record Date, you owned shares of the Company’s common stock, $1.00 par value per share (the “Common Stock”). This Proxy Statement describes the matters that will be presented for consideration by the stockholders at the Annual Meeting. It also gives you information concerning the matters to assist you in making an informed decision.

The Board is asking you to give us your proxy. Giving us your proxy means that you authorize another person or persons to vote your shares of Common Stock at the Annual Meeting in the manner you direct. If you vote using one of the methods described herein, you appoint the proxy holder as your representative at the meeting, who will vote your shares as you instruct, thereby assuring that your shares will be voted whether or not you attend the meeting. Even if you plan to attend the meeting, you should complete, sign and return your proxy card, or vote by internet or telephone, in advance of the meeting, just in case your plans change. If you have signed and returned the proxy card, or voted by internet or telephone, and an issue comes up for a vote at the meeting that is not identified in this Proxy Statement or on the proxy card, the proxy holder will vote your shares, pursuant to your proxy, in accordance with his or her judgment.

2025 Proxy Statement

What matters will be voted on at the Annual Meeting?

You are being asked to vote on: (1) the election of the nine director nominees named in this Proxy Statement to serve on the Board; (2) the approval, on a non-binding advisory basis, of the compensation paid to our named executive officers (the “say-on-pay proposal”); (3) the approval, on a non-binding advisory basis, of how often we will hold future advisory votes on the compensation paid to our named executive officers (the “say-on-frequency proposal”); (4) the ratification of the appointment of RSM US LLP (“RSM”) as our independent registered public accounting firm for the 2025 fiscal year; and (5) the approval of an amendment to the Company’s Third Amended and Restated Certificate of Incorporation (the “Certificate of Incorporation”) to increase the number of authorized shares of Common Stock from 30,000,000 shares to 60,000,000 shares (the “authorized share amendment proposal”).

What are the Board’s voting recommendations?

The Board recommends that you vote your shares “FOR” the election of each of the nine director nominees named in this Proxy Statement, “FOR” the advisory, non-binding “say-on-pay” proposal, “1 YEAR” on the advisory, non-binding say-on-frequency proposal, “FOR” the ratification of RSM as our independent registered public accounting firm for the 2025 fiscal year, and “FOR” the approval of the authorized share amendment proposal.

How do I vote?

Stockholders of Record. If you are a stockholder of record (that is, if your shares are registered in your own name with our transfer agent), you may vote using the enclosed proxy card. Voting instructions are provided on the proxy card contained in the proxy materials.

Beneficial Owners of Shares Held in Street Name. If you are a beneficial owner of shares held in street name (that is, if you hold your shares through a bank, broker or other holder of record), you must provide your voting instructions in accordance with the voting instruction form provided by your bank, broker or other holder of record, who will then vote your shares on your behalf. The availability of telephone or internet voting will depend upon your bank’s, broker’s, or other holder of record’s voting process.

Although you may vote by mail, we ask that you vote instead by internet or telephone, which saves us postage and processing costs. You may vote by telephone by calling the toll-free number specified on your proxy card or vote by internet by accessing the website specified on your proxy card and by following the preprinted instructions on the proxy card. If you submit your vote by telephone or internet, you may incur costs, such as cable telephone and internet access charges. Votes submitted by telephone or internet must be received by 11:59 p.m., Eastern Time, on Wednesday, May 7, 2025. The giving of a proxy by either of these means will not affect your right to vote in person if you decide to attend the meeting.

You may also vote online during your attendance at the virtual Annual Meeting using the unique 11-digit control number found on the proxy card.

Please note that if your shares are held in the name of a broker or other fiduciary (i.e., in street name), you will need to follow the instructions provided by your broker or other fiduciary to vote your shares electronically during the virtual Annual Meeting. Even if you plan to attend the virtual Annual Meeting, you should complete, sign and return your proxy card, or vote by telephone or internet, in advance of the Annual Meeting just in case your plans change.

What happens if I do not give specific voting instructions?

Stockholders of Record. If you are a stockholder of record and you: (i) indicate when voting on the internet or by telephone that you wish to vote as recommended by the Board; or (ii) sign and return a proxy card without giving specific voting instructions, then the persons named as proxy holders will vote your shares in the manner recommended by the Board on all matters presented in this Proxy Statement and as the proxy holders may determine in their judgment with respect to any other matters properly presented for a vote at the Annual Meeting.

Beneficial Owners of Shares Held in Street Name. If you are a beneficial owner of shares held in street name and do not provide the bank, broker or other holder of record that holds your shares with specific voting instructions, then, under applicable rules, the bank, broker or other holder of record that holds your shares may generally vote on “routine” matters but cannot vote on “non-routine” matters. If the bank, broker or other holder of record that holds your shares does not receive instructions from you on how to vote your shares on a non-routine matter, that bank, broker or other holder of record will inform the inspector of election that it does not have the authority to vote on this matter with respect to your shares. This is generally referred to as a “broker non‑vote.”

At the meeting, the election of directors, the say-on-pay proposal and the say-on-frequency proposal are considered non-routine matters, while the ratification of the appointment of RSM as our independent registered public accounting firm and the authorized share amendment proposal are considered routine matters. This means that, if you hold your shares in street name and do not instruct the bank, broker or other holder of record that holds your shares with specific voting instructions, then the bank broker or other holder of record that holds your shares will not have the authority to vote on the election of directors, the say-on-pay proposal or the say-on-frequency proposal, but will have the authority to vote on the ratification of the appointment of RSM as our independent registered public accounting firm and the authorized share amendment proposal.

2025 Proxy Statement

What should I do if some or all of my shares are held by the Company’s Employee Stock Ownership Plan?

If you hold shares of Common Stock as a participant in the Alerus Financial Corporation Employee Stock Ownership Plan (the “ESOP”), you will receive this Proxy Statement, together with separate voting instructions, from Alerus’ transfer agent, Equiniti Trust Company, LLC. If you do not vote your shares of Common Stock held as a participant in the ESOP pursuant to these separate voting instructions, the trustee of the ESOP (the “ESOP Trustee”) will vote such shares in a manner that is consistent with and proportionate to the voting instructions received from those ESOP participants and beneficiaries who did provide voting direction to the ESOP Trustee. If you have any questions regarding these procedures, you should contact the ESOP Trustee directly.

What if I change my mind after I return my proxy?

If you hold your shares in your own name, you may revoke your proxy and change your vote at any time before the polls close at the Annual Meeting. You may do this by:

■	signing another proxy card with a later date and returning that proxy card to Equiniti Trust Company, LLC, 55 Challenger Road, 2nd Floor, Ridgefield Park, New Jersey 07660;

■	timely submitting another proxy via telephone or internet; or

■	voting in person at the virtual Annual Meeting.

If you hold your shares in the name of your broker or the ESOP, and desire to change your vote, you will need to contact your broker or the ESOP Trustee to do so.

What is the quorum required to hold the Annual Meeting and conduct business?

The holders of shares of stock having a majority of the votes that could be cast by the holders of all outstanding shares of stock entitled to vote at the Annual Meeting as of the close of business on the Record Date must be present in person or by proxy at the Annual Meeting in order to hold the Annual Meeting and conduct business. Virtual attendance at the Annual Meeting constitutes presence “in person” for purposes of determining a quorum at the Annual Meeting. Shares are counted as present at the meeting if the stockholder either:

■	is present and votes in person at the meeting; or

■	has properly submitted a signed proxy card or other proxy, including voting by telephone or internet.

As of the close of business on the Record Date there were 25,510,740 shares of Common Stock issued and outstanding, which is the only class of voting stock of the Company outstanding. Therefore, at least 12,755,371 shares need to be represented in order to constitute a quorum. Broker non-votes will count for purposes of determining whether or not a quorum is present since routine matters (the ratification of the appointment of RSM as our independent registered public accounting firm and the authorized share amendment proposal) are on the proxy ballot. Similarly, abstentions will be considered in determining the presence of a quorum. Only the holders of record of Common Stock as of the close of business on the Record Date are entitled to receive notice of the Annual Meeting and to vote on such matters as may come before the Annual Meeting. Each share of Common Stock is entitled to one vote per share.

What happens if a director nominee is unable to stand for election?

The Board may, by resolution, provide for a lesser number of directors or designate a substitute nominee. In the latter case, shares represented by proxies may be voted for a substitute nominee. You cannot vote for more than nine director nominees. The Board has no reason to believe that any nominee will be unable to stand for election.

How many votes may I cast?

You are entitled to cast one vote for each share of Common Stock you owned as of the close of business on the Record Date. The proxy card included with this Proxy Statement indicates the number of shares owned by an account attributable to you at such time. Stockholders do not have cumulative voting rights with respect to the election of directors.

What options do I have in voting on each of the proposals?

In the election of directors, you may vote “FOR” or “WITHHOLD AUTHORITY TO VOTE FOR” each nominee. There is no cumulative voting for the election of directors.

For the approval on a non-binding advisory basis of the say-on-pay proposal, the ratification of the appointment of RSM as our independent registered public accounting firm, and the approval of the authorized share amendment proposal, you may vote “FOR,” “AGAINST” or “ABSTAIN” with respect to such proposals. For the approval on a non-binding advisory basis of the say-on-frequency proposal, you may vote for a “1 YEAR,” “2 YEARS” or “3 YEARS” frequency, or you may vote “ABSTAIN.”

2025 Proxy Statement

How many votes are needed for each proposal?

Proposal 1 (Election of Directors) – The nine individuals receiving the highest number of votes cast “FOR” their election will be elected as directors of the Company. In an uncontested election, all director nominees will be elected if they receive at least one vote “FOR” their election. Abstentions, votes to “withhold” and broker non-votes, if any, will not affect the outcome of the election.

Proposal 2 (Say-on-Pay Proposal) – The affirmative vote of the majority of shares of Common Stock present in person or represented by proxy at the Annual Meeting and entitled to vote on the matter is required to approve the say-on-pay proposal, on a non-binding advisory basis. Abstentions will have the same legal effect as a vote “against” this proposal, while broker non-votes, because they will not be counted as entitled to vote, will not affect the voting on this proposal. Please note that, because the say-on-pay proposal is non-binding and advisory, the outcome of this vote will not be binding on the Board.

Proposal 3 (Say-on-Frequency Proposal) – The choice that receives the highest number of votes cast will be considered the choice of the stockholders. Abstentions and broker non-votes, if any, will not affect the outcome of the vote. Please note that, because the say-on-frequency proposal is non-binding and advisory, the outcome of this vote will not be binding on the Board.

Proposal 4 (Ratification of RSM) – The affirmative vote of the majority of shares of Common Stock present in person or represented by proxy at the Annual Meeting and entitled to vote on the matter is required to ratify the appointment of RSM as our independent registered public accounting firm for the fiscal year ended December 31, 2025. Abstentions will have the same legal effect as a vote “against” this proposal, while broker non-votes will not affect the voting on this proposal.

Proposal 5 (Authorized Share Amendment Proposal) – The affirmative vote of the majority of the shares of outstanding Common Stock entitled to vote on the matter is required to approve the authorized share amendment proposal. Abstentions will have the same legal effect as a vote “against” this proposal. If you are a beneficial owner of shares held in street name and do not provide the bank, broker or other holder of record that holds your shares with specific voting instructions, the bank, broker or other holder of record that holds your shares will be entitled to vote the shares in its discretion with respect to the authorized share amendment proposal, as this is a routine matter, and broker non-votes, if any, will have the effect of a vote “against” this proposal.

Unless otherwise provided by law, or by the Company’s Certificate of Incorporation or its Second Amended and Restated Bylaws (the “Bylaws”), any other matter properly brought before the Annual Meeting or any adjournment thereof shall be decided by the affirmative vote of the majority of shares of Common Stock present in person or represented by proxy at the Annual Meeting and entitled to vote on the matter. Abstentions will have the same legal effect as a vote “against” these matters, while broker non-votes, because they will not be counted as entitled to vote, will not affect the voting on such matters.

Who bears the cost of soliciting proxies?

The Company will bear the cost of soliciting proxies. We have engaged Equiniti Trust Company, LLC to assist in the delivery of proxy materials and to establish and operate online and telephonic voting platforms and processes. We may also reimburse brokerage houses and other custodians, nominees, and fiduciaries for their reasonable out-of-pocket expenses for forwarding proxy and solicitation materials to stockholders. The Company has engaged D.F. King & Co., Inc. (“D.F. King”) to assist in the solicitation of proxies for the Annual Meeting. The Company has agreed to pay D.F. King a fee of $12,500. The Company will also reimburse D.F. King for reasonable out-of-pocket expenses and will indemnify D.F. King and its affiliates against certain claims, liabilities, losses, damages and expenses. In addition to solicitations by D.F. King, officers, directors or employees of the Company or its subsidiary may solicit proxies in person or by telephone. These persons will not receive any special or additional compensation for soliciting proxies.

Where do I find the voting results of the meeting?

If available, we will announce voting results at the Annual Meeting. The voting results will also be disclosed in a Current Report on Form 8-K that we will file with the SEC within four business days after the Annual Meeting.

How can multiple stockholders sharing the same address request to receive only one notice or one set of proxy materials and other investor communications?

You may elect to receive future notices and proxy materials, as well as other investor communications, in a single package per address. This practice, known as “householding,” is designed to reduce our paper use and printing and postage costs. To make this election, please indicate on your proxy card under “Householding Election” your consent to receive such communications in a single package per address. Once we receive your consent, we will send a single package per household going forward, until you revoke your consent or request separate copies of our proxy materials by contacting the Company’s Secretary at 401 Demers Avenue, Grand Forks, North Dakota 58201 or (701) 795-3200. We will start sending you individual copies of proxy materials and other investor communications promptly following receipt of your revocation.

2025 Proxy Statement

PROPOSAL 1—

Election of Directors

GENERAL

The Company has one class of directors. Our directors serve for one-year terms or until their successors are elected and qualified. The Company’s current Certificate of Incorporation provides that the Board will consist of a maximum of twelve persons and a minimum of five persons, and the Company’s current Bylaws provide that the number of directors may be fixed from time to time by the Board within the range set by the Certificate of Incorporation. By resolutions adopted by the Board, the number of directors of the Board is currently fixed at nine.

The Board, acting upon the recommendation of the Nominating and Corporate Governance Committee, has nominated the following nine director nominees for election at the Annual Meeting, each to hold office for a one-year term expiring at the annual meeting of stockholders in 2026 or until a successor is elected and qualified: Daniel E. Coughlin, Katie A. Lorenson, Randy L. Newman, Galen G. Vetter, Janet O. Estep, Mary E. Zimmer, John Uribe, Nikki L. Sorum and Jeffrey W. Bolton. Proxies cannot be voted for more than nine director nominees. All of the director nominees are currently serving on the Board.

All of the director nominees have consented to serve. If for any reason any nominee becomes unavailable for election, the Board may designate a substitute nominee, in which event the shares represented by proxies properly returned to the Company will be voted for the substitute nominee, unless an instruction to the contrary is indicated on the proxy card.

The nine individuals receiving the highest number of votes cast “FOR” their election will be elected as directors of the Company. In an uncontested election, all director nominees will be elected if they receive at least one vote “FOR” their election. Abstentions, votes to “withhold” and broker non-votes, if any, will not affect the outcome of the election. Proxies properly signed and returned will be voted “FOR” each of the nominees for director unless you specify otherwise.

THE BOARD UNANIMOUSLY RECOMMENDS THAT YOU VOTE “FOR” EACH OF
THE NOMINEES FOR DIRECTOR.

2025 Proxy Statement

INFORMATION ABOUT THE DIRECTOR NOMINEES

The following table describes the business experience of each director nominee, as well as their qualifications to serve on the Board. No nominee has any family relationship, as defined by Item 401 of Regulation S-K, with any other executive officer or any of our current directors.

Nominees

Daniel E. Coughlin Director, Executive Chairman

Age: 62 Director since: 2016 Committees: ■ Nominating and Corporate Governance ■ Audit		Mr. Coughlin, a director of the Company since 2016, served as the Managing Director and Co-Head of the Financial Services Practice at Raymond James & Associates from 2011 until his retirement in 2014. ■ Beginning in 2001, Mr. Coughlin served as Chairman and CEO of Howe Barnes Hoefer & Arnett prior to its 2011 merger with Raymond James and served eight additional years with Howe Barnes Hoefer & Arnett in various capacities. ■ Mr. Coughlin also spent seven years with the Federal Reserve Bank of Chicago, where he assessed the competitive implications of bank mergers and acquisitions. ■ We consider Mr. Coughlin to be qualified for service on the Board and the committees on which he serves because of his over 40 years of financial services experience, and knowledge and experience in areas such as strategic planning, risk management, mergers, and acquisitions, and capital formation.

Katie A. Lorenson Director, President and Chief Executive Officer

Age: 44 Director since: 2021		Ms. Lorenson serves as the President and Chief Executive Officer of the Company after being named to those positions in 2021. Ms. Lorenson joined the Company as Executive Vice President and Chief Financial Officer in December 2017 and assumed leadership over the Company’s retirement, wealth management, mortgage and banking product areas in 2020. ■ Ms. Lorenson is a seasoned executive with extensive experience overseeing financial service organizations and product and services management, previously serving as Chief Financial Officer at MidWestOne Financial Group, Inc. ■ Ms. Lorenson formerly served as Chief Financial Officer for Central Bancshares, Inc. which was acquired by MidWestOne Financial Group, Inc. in 2015. Prior to these roles, Ms. Lorenson served as Manager on the Financial Institutions Team for RSM (formerly, McGladrey & Pullen). ■ We consider Ms. Lorenson to be a qualified candidate for service on the Board because of her management and leadership experience as the Chief Executive Officer and President of the Company and her extensive experience in banking and prior financial leadership roles.

2025 Proxy Statement

Randy L. Newman Director

Age: 71 Director since: 1988 Committees: ■ Risk (Chair) ■ Nominating and Corporate Governance		Mr. Newman, a director of the Company since 1995, joined the Company, formerly First National Bank of North Dakota in 1981, and became its President in 1987 and its Chief Executive Officer in 1995. He served in those roles until he retired on January 1, 2022. ■ Prior to joining the Company, Mr. Newman taught Corporate Finance and Business Strategy courses at the University of North Dakota. He was a director of the Federal Home Loan Bank of Des Moines from 1997 to 2007. ■ Mr. Newman served as a Class A Director of the Federal Reserve Bank of Minneapolis from 2012 to 2018. ■ Mr. Newman received his BSBA in 1975 and his MBA in 1979 from the University of North Dakota. ■ We consider Mr. Newman to be qualified for service on the Board and the committees on which he serves because of his deep experience in the banking industry, strategic planning, mergers and acquisitions and knowledge of the Company gained during his tenure with us as our former Chief Executive Officer.

Galen G. Vetter Director

Age: 73 Director since: 2013 Committees: ■ Audit (Chair) ■ Compensation		Mr. Vetter has served as a director of the Company since 2013. Mr. Vetter has varied and broad board of director experience, having served on over a dozen boards over the past three decades. ■ Mr. Vetter is a retired CPA with an extensive background, including executive-level positions at Franklin Templeton Investments and RSM. ■ Mr. Vetter’s roles at RSM included Partner In-Charge of the Upper Midwest Region and National Executive Partner, with leadership responsibilities for financial management, information technology, and development of professional services industry practices. ■ As CFO and Senior Vice President at Franklin Templeton, Mr. Vetter’s responsibilities included oversight of accounting, financial compliance, and filings in dozens of counties for the funds. ■ Mr. Vetter holds a Bachelor of Science degree with an accounting emphasis from the University of Northern Iowa. ■ We consider Mr. Vetter to be qualified for service on the Board and the committees on which he serves because of his extensive experience in financial oversight and leadership roles, prior board experiences at other companies, accounting and finance knowledge and his qualification to serve as the Audit Committee’s financial expert.

2025 Proxy Statement

Janet O. Estep Director

Age: 68 Director since: 2021 Committees: ■ Nominating and Corporate Governance (Chair) ■ Risk Other public boards: ■ ACI Worldwide		Ms. Estep, a director of the Company since October 2021, is the former Chief Executive Officer and President of Nacha, the governing body for the US ACH payment network, a position she held from 2008 until 2019. ■ Before joining Nacha, Ms. Estep served as Executive Vice President of U.S. Bank’s Transaction Services Division. Ms. Estep previously led the sales and marketing teams of Pace Analytical and was general manager of its major environmental lab location. ■ Before Pace Analytical, Ms. Estep developed extensive technology knowledge through many field and headquarters positions with IBM, managing sales teams and product development for both hardware and software. ■ Ms. Estep received a B.A. in Economics and Psychology from St. Olaf College and currently serves on the board of ACI Worldwide, a global payments software provider, also serving on its Nominating and Governance and its Audit/Risk Committees. ■ We consider Ms. Estep to be qualified for service on the Board and the committees on which she serves because of her over 35 years as an accomplished executive with experience in financial services and technology in areas such as digital technology, electronic payments, strategic planning, mergers and acquisitions, product development and sales, risk management, and regulatory oversight.


Mary E. Zimmer Director

Age: 62 Director since: 2021 Committees: ■ Compensation (Chair) ■ Nominating and Corporate Governance		Ms. Zimmer, a director of the Company since October 2021, is the former Regional President for Wells Fargo Advisors’, or WFA, wealth management business. ■ In her role as Regional President of WFA, Ms. Zimmer led the Northern Region covering ten states across the Midwest and Northwest. Ms. Zimmer later launched and led WFA’s Diverse Client Segments team. ■ Prior to WFA, Ms. Zimmer held leadership roles at Royal Bank of Canada U.S. Wealth Management, including Head of International Wealth USA, Head of Wealth Management Services, and Chief Operating Officer/Chief Administrative Officer. ■ Before beginning her wealth management career, Ms. Zimmer worked in public accounting as a licensed CPA at Arthur Young, now Ernst & Young. ■ Ms. Zimmer received her B.A. in Business and Accounting at the University of Saint Thomas and her M.B.T. in Business Taxation at the University of Minnesota – Carlson School of Management. ■ We consider Ms. Zimmer to be qualified for service on the Board and the committees on which she serves because she brings over 35 years of experience in financial services with an extensive background in wealth management, capital markets, strategic planning, client segmentation, and product development.

2025 Proxy Statement

John Uribe Director

Age: 57 Director since: 2023 Committees: ■ Audit ■ Risk		Mr. Uribe, a director of the Company since December 2023, is the current Chief Financial Officer at Blue Cross and Blue Shield of Minnesota, a position he has held since 2022. ■ Prior to his appointment as Chief Financial Officer at Blue Cross and Blue Shield of Minnesota, Mr. Uribe served as Vice President of Corporate Development and Interim Treasurer since 2012. Before joining Blue Cross, Mr. Uribe served in various finance leadership roles at RedBrick Health, GE Commercial Finance-Fleet Services, Schwann’s, and General Mills. ■ Mr. Uribe is a board member for organizations including the Bakken Museum, and the Latino Economic Development Center. ■ Mr. Uribe holds a bachelor’s degree in accounting and an MBA in finance and international business from Indiana University Bloomington. ■ We consider Mr. Uribe to be qualified for service on the Board and the committees on which he serves because of his more than 30 years of financial and strategic leadership experience with expertise in mergers and acquisitions, financial planning and analysis, and general management.


Nikki L. Sorum Director

Age: 63 Director since: 2023 Committees: ■ Compensation ■ Risk		Ms. Sorum, a director of the Company since December 2023, brings 40 years of experience as a leader in the financial services industry. She was an executive at Thrivent for two decades, including leading Sales and Distribution, a position she held from 2020 until 2023. ■ Prior to her time at Thrivent, Ms. Sorum served in Senior Vice President roles at RBC Wealth Management and was a partner at McKinsey & Co. in London, Chicago and Minneapolis. ■ Ms. Sorum holds a bachelor’s degree in economics from the University of Minnesota Twin Cities and an MBA from Harvard Business School. ■ We consider Ms. Sorum to be qualified for service on the Board and the committees on which she serves because of her 40 years of experience as a leader in the financial services industry with deep experience in wealth management services, talent management, strategic planning, and leadership.

2025 Proxy Statement

Jeffrey W. Bolton Director

Age: 69 Director since: 2024 Committees: ■ Compensation ■ Audit Other public boards: ■ Enhabit Home Health and Hospice		Mr. Bolton, a director of the Company since October 2024, has served as an independent consultant for health services and economic development firms since February 2022. Mr. Bolton is currently the CEO of Bolton Advisory, LLC. Previously, he served as chief administrative officer of the Mayo Clinic from 2013 to 2021 and as its chief financial officer from 2002 to 2013. ■ Prior to working for the Mayo Clinic, Mr. Bolton held various business and finance-related positions at Carnegie Mellon University, including chief financial officer and vice president for business and planning. ■ Mr. Bolton currently serves as chair of the board of Enhabit Home Health and Hospice (Audit and Finance Committee and Nominating and Corporate Governance Committee), a NYSE-listed company; as the board chair for Resoundant; on the board of M. Lee Pearce Foundation; on the board of MCS, Inc. (Finance Committee chair and Audit Committee); and on the board of St. Olaf College (chair of academic affairs committee). Mr. Bolton previously served on the board of directors of HMN Financial, Inc. (chair of Audit Committee and member of Governance and Nominating committee), a Nasdaq-listed financial institution holding company. ■ Mr. Bolton holds a bachelor’s degree from Pennsylvania State University, and master’s degrees in business administration and social work from the University of Pittsburgh. ■ Mr. Bolton was appointed to the Board in October 2024 immediately following the Company’s acquisition of HMN Financial, Inc., pursuant to the terms of the Agreement and Plan of Merger governing the acquisition. ■ We consider Mr. Bolton to be qualified for service on the Board and the committees on which he serves because of vast experience in various financial leadership roles, prior experience as a director on the board of another publicly traded financial institution holding company and experience in strategic leadership.

BOARD DIVERSITY

In assessing Board composition and prior to nominating an existing director for re-election to the Board, the Nominating and Corporate Governance Committee considers and reviews a number of attributes with respect to each existing director, including diversity of experience, skills and contributions that the existing director brings to the Board. Our Board is comprised of nine directors, five of whom identify as male and four of whom identify as female. One of the male directors identifies as Hispanic or Latinx.

2025 Proxy Statement

Corporate Governance and The Board of Directors

We currently have nine directors serving on our Board, a majority of whom we have determined to be “independent,” as that term is defined by the Nasdaq Stock Market (“Nasdaq”). Our Board has evaluated the independence of its members based upon the rules of Nasdaq and the SEC. Applying these standards and based on information provided by each director concerning his or her background, employment and affiliations, our Board has affirmatively determined that, with the exception of Ms. Lorenson, each of our current directors is an independent director, as defined under the applicable rules. The Board determined that Ms. Lorenson does not qualify as an independent director because she is an executive officer of the Company and the Bank.

Generally, the Board oversees our business and monitors the performance of our management. In accordance with our corporate governance procedures, the Board does not involve itself in the day-to-day operations of the Company, which are monitored by our executive officers and management. Our directors fulfill their duties and responsibilities by attending regular meetings of the full Board, with additional special meetings held from time to time. Our directors also discuss business and other matters with Ms. Lorenson, other key executives and our principal external advisers (legal counsel, auditors and other consultants) at times other than regularly scheduled meetings when appropriate.

Our Board has established standing committees in connection with the discharge of its responsibilities. These committees include the Audit Committee, Compensation Committee, Nominating and Corporate Governance Committee and Risk Committee. Our Board also may establish such other committees as it deems appropriate, in accordance with applicable laws and regulations, our Certificate of Incorporation and Bylaws.

The current charters of the Audit Committee, Compensation Committee, Nominating and Corporate Governance Committee and Risk Committee are available on the Company’s website at investors.alerus.com under the “Corporate Governance – Governance Documents” heading.

BOARD AND COMMITTEE MEETINGS

During the fiscal year ended December 31, 2024, the Board held four regular meetings and three special meetings. During 2024, all directors, with the exception of Mr. Uribe and Mr. Bolton, attended at least 75 percent of the aggregate of the total number of meetings of the Board and the total number of meetings held by the committees on which they served. Mr. Bolton was appointed to the Board in October 2024 and attended the December 2024 Board and committee meetings, which were the only meetings held in 2024 following his appointment as a director. In 2025, the full Board intends to meet at least four times with special meetings held from time to time when necessary and through committee membership, which is discussed below.

The Board also regularly holds executive sessions of the independent (non-management) members of the Board, without inside directors or executive management present. Our independent Executive Chairman, Mr. Coughlin, serves as Chairman at these executive sessions. The Chairman is responsible for coordinating with the Chief Executive Officer to set the agenda for Board meetings and advising the Chief Executive Officer on various Board matters.

COMMITTEE STRUCTURE

The Board exercises certain of its powers through the following committees: Audit Committee, Compensation Committee, Nominating and Corporate Governance Committee, and Risk Committee. Each committee has a charter that addresses its purpose, authority, and responsibilities and contains other provisions relating to membership and meeting requirements. As required by its charter, each committee annually reviews and assesses its charter, but may recommend amendments at any time. In addition, each charter requires the committee to annually review its performance. Each committee has the authority to engage outside advisors to the extent it considers appropriate to assist the committee in its work. Each committee is comprised of non-employee directors only, and each non-employee director sits on at least two committees. During the February 2025 Board meeting, the Board reassigned certain committee memberships to align expertise and account for Mr. Bolton joining the Board in late 2024. Each committee chair reports to the full Board on the matters undertaken at each committee meeting.

2025 Proxy Statement

The following table summarizes the current membership of each of the committees of the Board:

			NOMINATING AND
			CORPORATE
	AUDIT	COMPENSATION	GOVERNANCE	RISK
DIRECTOR NAME	COMMITTEE	COMMITTEE	COMMITTEE	COMMITTEE
Daniel E. Coughlin	X		X
Randy L. Newman			X	Chair
Galen G. Vetter	Chair	X
Janet O. Estep			Chair	X
Mary E. Zimmer		Chair	X
John Uribe	X			X
Nikki L. Sorum		X		X
Jeffrey W. Bolton	X	X

The following is a summary of the functions of each committee:

Audit Committee

Our Audit Committee currently consists of Galen G. Vetter (Chair), Daniel E. Coughlin, John Uribe , and Jeffrey W. Bolton. Our Board has evaluated the independence of the members of our Audit Committee and has affirmatively determined that: (i) each of the members of our Audit Committee meets the definition of “independent director” under Nasdaq rules; (ii) each of the members satisfies the additional independence standards under Nasdaq rules and applicable SEC rules for audit committee service; and (iii) each of the members has the ability to read and understand fundamental financial statements. In addition, our Board has determined that Mr. Vetter has the required financial sophistication due to his experience and background, which Nasdaq rules require at least one Audit Committee member have. Our Board has determined that Mr. Vetter also qualifies as an “audit committee financial expert,” as that term is defined under applicable SEC rules. The Audit Committee met four times in 2024.

Our Audit Committee has adopted a written charter, which sets forth the committee’s duties and responsibilities. The current charter of the Audit Committee is available on our website at investors.alerus.com. As described in its charter, our Audit Committee has responsibility for, among other things:

■	selecting and reviewing the performance of our independent auditors and approving, in advance, all engagements and fee arrangements;

■	reviewing the independence of our independent auditors;

■	meeting with management, internal auditors and the independent auditors to review the effectiveness of our system of internal control and internal audit procedures;

■	reviewing our earnings releases and reports filed with the SEC;

■	reviewing reports of bank regulatory agencies and monitoring management’s compliance with recommendations contained in those reports;

■	reviewing and approving transactions for potential conflicts of interest under our Company’s conflict of interest policy; and

■	handling such other matters that are specifically delegated to the Audit Committee by our Board from time to time.

Compensation Committee

Our Compensation Committee currently consists of Mary E. Zimmer (Chair), Galen G. Vetter, Nikki L. Sorum, and Jeffrey W. Bolton. Our Board has evaluated the independence of the members of our Compensation Committee and has affirmatively determined that all of the members of our Compensation Committee are “independent” under Nasdaq rules and also satisfy the additional independence standards under Nasdaq rules for compensation committee service. The Compensation Committee met four times in 2024.

2025 Proxy Statement

Our Compensation Committee has adopted a written charter, which sets forth the committee’s duties and responsibilities. The current charter of the Compensation Committee is available on our website at investors.alerus.com. As described in its charter, our Compensation Committee has responsibility for, among other things:

■	reviewing, monitoring and approving our overall compensation structure, policies and programs (including benefit plans) and assessing whether the compensation structure establishes appropriate incentives for our executive officers and other employees and meets our corporate objectives;

■	reviewing and approving annually the corporate goals and objectives applicable to the compensation of our Chief Executive Officer and determining and approving the Chief Executive Officer’s compensation level based on annual performance evaluations;

■	reviewing and approving the annual compensation of our other named executive officers;

■	determining stock ownership guidelines for the Chief Executive Officer, directors and other executive officers and monitoring compliance with such guidelines;

■	overseeing the administration of our equity plans and other incentive compensation plans and programs and making recommendations to our Board relating to these matters;

■	preparing the Compensation Committee report to be included in our proxy statement or annual report; and

■	handling such other matters that are specifically delegated to the Compensation Committee by our Board from time to time.

Our Compensation Committee has the authority to delegate any of its responsibilities, along with the authority to take action in relation to such responsibilities, to one or more subcommittees as the Compensation Committee may deem appropriate in its sole discretion. Non-employee director compensation decisions are made by our Board, which includes one named executive officer.

Nominating and Corporate Governance Committee

Our Nominating and Corporate Governance Committee currently consists of Janet O. Estep (Chair), Randy L. Newman, Daniel E. Coughlin, and Mary E. Zimmer. Our Board has evaluated the independence of the members of our Nominating and Corporate Governance Committee and has affirmatively determined that each of the members of our Nominating and Corporate Governance Committee is “independent” under Nasdaq rules. The Nominating and Corporate Governance Committee met four times in 2024.

Our Nominating and Corporate Governance Committee has adopted a written charter, which sets forth the committee’s duties and responsibilities. The current charter of the Nominating and Corporate Governance Committee is available on our website at investors.alerus.com. As described in its charter, our Nominating and Corporate Governance Committee has responsibility for, among other things:

■	identifying and recommending persons to be selected by our Board as nominees for election as directors or to fill any vacancies on our Board;

■	developing and recommending to the Board a set of corporate governance guidelines applicable to our Company and reviewing these guidelines at least once a year;

■	reviewing the Board’s committee structure and composition and making recommendations to the Board regarding the appointment of directors to serve as members of each committee and as committee Chair annually; and

■	handling such other matters that are specifically delegated to the Nominating and Corporate Governance Committee by our Board from time to time.

In carrying out its nominating functions, the Nominating and Corporate Governance Committee has developed qualification criteria for all potential director nominees, including incumbent directors, Board nominees and stockholder nominees included in the proxy statement. These criteria include the following attributes:

■	integrity and high ethical standards in the nominee’s professional life;

■	sufficient educational and professional experience, business experience, or comparable service on other boards of directors to qualify the nominee for service on the Board;

■	evidence of leadership and sound judgment in the nominee’s professional life;

■	a willingness to abide by any published code of ethics for our Company;

■	a willingness and ability to devote sufficient time to carrying out the duties and responsibilities required of a Board member; and

■	diversity of viewpoints, background, experience and other demographics.

The Nominating and Corporate Governance Committee also evaluates potential nominees to determine if they have any conflicts of interest that may interfere with their ability to serve as effective Board members and to determine whether they are “independent” in accordance with Nasdaq rules (to ensure that, at all times, at least a majority of our directors are independent). In previous years the Company has used a third-party search firm to conduct searches for director candidates.

2025 Proxy Statement

Prior to nominating an existing director for re-election to the Board, the Nominating and Corporate Governance Committee considers and reviews the following attributes with respect to each existing director:

■	Board and committee attendance and performance;

■	age and length of Board service;

■	diversity of experience, skills and contributions that the existing director brings to the Board;

■	independence and any conflicts of interest; and

■	any significant change in the director’s professional status or work experience, including in the attributes considered for initial Board membership.

The Nominating and Corporate Governance Committee will give appropriate consideration to candidates for Board membership proposed by stockholders that are supported by adequate information about the candidates’ qualifications and will evaluate such candidates in the same manner as other candidates identified by or submitted to the Nominating and Corporate Governance Committee. Because of this, there is no separate policy with regard to consideration of candidates recommended by stockholders.

Risk Committee

Our Risk Committee currently consists of Randy L. Newman (Chair), Janet O. Estep, Nikki L. Sorum and John Uribe, each of whom are independent from management of our Company and Bank. The Risk Committee met four times in 2024.

Our Risk Committee has adopted a written charter, which sets forth the committee’s duties and responsibilities. The current charter of the Risk Committee is available on our website at investors.alerus.com. As described in its charter, our Risk Committee has responsibility for, among other things:

■	overseeing management’s establishment of a risk management vision and annually making recommendations to our Board regarding our Company’s risk appetite statement;

■	annually reviewing and approving our Company’s overall risk management framework;

■	annually reviewing and approving our Company’s general enterprise risk policy;

■	reviewing management reports summarizing our Company’s enterprise level risk profile; and

■	handling such other matters that are specifically delegated to the Risk Committee by our Board from time to time.

STOCKHOLDER COMMUNICATION AND ENGAGEMENT

Communication and Engagement with the Board and Executive Management

Although we do not have a formal policy regarding director attendance at the Annual Meeting, we encourage and expect all of our directors to attend. In 2024, all of our directors serving at the time were present at the Annual Meeting.

Since last year’s annual meeting of stockholders, the Company’s Board and executive management team has made efforts to hold discussions with a number of the Company’s retail and institutional stockholders. These conversations ensure the Company is considering stockholder input, addressing their concerns, and gaining valuable perspective on its strategy. Feedback from stockholders was shared with the Board and executive management, contributing to strong governance and transparency with stockholders. These exchanges help us focus on the issues that matter most to our stockholders and supports our efforts to share our strategic vision.

General Communications with the Board

Stockholders may contact our Board by contacting Katie A. Lorenson, President and Chief Executive Officer, Alerus Financial Corporation at 401 Demers Avenue, Grand Forks, North Dakota 58201 or (701) 795‑3200.

NOMINATIONS OF DIRECTORS AND STOCKHOLDER PROPOSALS

The matters to be considered and brought before any annual or special meeting of our stockholders are limited to only those matters as shall be brought properly before such meeting in compliance with the procedures set forth in our Bylaws. For proposals to be brought by a stockholder of the Company and voted upon at an annual meeting, including with respect to the nomination of a director other than the Board’s nominees, the stockholder must deliver written notice of the proposal to our Secretary not less than 90 days nor more than 120 days prior to the first anniversary date of the annual meeting for the preceding year. However, if the annual meeting is not scheduled to be held within a period that commences 30 days before such anniversary date and ends within 60 days after such anniversary date (an annual meeting date outside such period being referred to herein as an “Other Meeting Date”), the stockholder’s notice shall be given in the manner provided in our Bylaws by the later of the close of business on (1) the date 90 days prior to such Other Meeting Date or (2) the 10th day following the date such Other Meeting Date is first publicly announced or disclosed. In the event that the number of directors to be elected to the Board is increased and either all of the nominees for director or the size of the increased Board is not publicly announced or disclosed by us at least 100 days prior to the first anniversary of the preceding year’s annual meeting, a stockholder’s notice will also be considered timely, but only with respect to nominees for any new positions created by such increase, if it is delivered to our Secretary at our principal executive office not later than the close of business on the 10th day following the first date all of such nominees or the size of the increased Board is publicly announced or disclosed. Any stockholder’s notice to the Company’s Secretary must include the information required by SEC rule 14a-19, and Section 1.12 of our Bylaws: (a) a brief description and the text of the proposal desired to be brought before the annual meeting and the reasons why such stockholder favors the proposal; (b) the name and address of the stockholder proposing such business; (c) the number of shares of our Common Stock or other equity or debt securities beneficially owned by such stockholder on the date of such stockholder’s notice; and (d) any financial or other interest of such stockholder in the proposal. Stockholders should refer to the full text of our advance notice provisions contained in Section 1.12 of our Bylaws.

2025 Proxy Statement

Written notice of stockholder proposals to be brought at our 2026 annual meeting of stockholders in accordance with the above procedures must be delivered to our Secretary no earlier than January 8, 2026 and no later than February 7, 2026, unless an Other Meeting Date occurs with respect to the 2026 annual meeting of stockholders, in which case the notice delivery requirements will be as set forth above with respect to meetings with Other Meeting Dates.

In lieu of the foregoing notice procedures, stockholders seeking to submit a proposal for inclusion in our proxy statement for the 2026 annual meeting of stockholders must follow the procedures and meet the other requirements outlined in Rule 14a‑8 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), and we must receive such proposal at our principal executive office on or before November 26, 2025.

Any proposals, notices or nominations must be sent to the attention of our Secretary at Alerus Financial Corporation, 401 Demers Avenue, Grand Forks, North Dakota 58201. A copy of our Bylaws, which we included as Exhibit 3.2 to our Form S‑1 filed with the SEC on August 16, 2019, can be accessed through the SEC’s website at www.sec.gov.

BOARD LEADERSHIP STRUCTURE

Our Board does not have a formal policy requiring the separation of the roles of Chairman of the Board and Chief Executive Officer. It is our directors’ view that rather than having a rigid policy, the Board, with the advice and assistance of the Nominating and Corporate Governance Committee, and upon consideration of all relevant factors and circumstances, will determine, as and when appropriate, whether the two offices should be separate.

Currently, the positions of Chairman and Chief Executive Officer are separate and held by Mr. Coughlin and Ms. Lorenson, respectively. As noted above, Mr. Coughlin is considered an “independent” director.

The Board believes, based on a review of the factors outlined above, that having a director other than the Chief Executive Officer serving as Chairman of the Board is in the best interest of stockholders. The Board and its Nominating and Corporate Governance Committee believe that this structure will be useful in providing consistent oversight and strategic direction to the Company. The Board expects Ms. Lorenson to take the lead in developing the strategic plan for the Company, providing day-to-day leadership and managing the performance of the Company. The Board expects the Chairman to lead the Board meetings, participate in committee meetings and advise Company management. The Board intends to periodically review the Company’s leadership structure and make changes as dictated by the circumstances and the best interests of the stockholders.

BOARD OVERSIGHT OF RISK MANAGEMENT

Our Board believes that effective risk management and control processes are critical to our safety and soundness, our ability to predict and manage the challenges that we face, and, ultimately, our long-term corporate success. Our Board, both directly and through its committees, is responsible for overseeing our risk management processes, with each of the committees of our Board assuming a different and important role in overseeing the management of the risks we face.

The Risk Committee of our Board oversees our enterprise-wide risk management framework and corporate risk function, which establishes our overall risk appetite and risk management strategy and enables our management to understand, manage and report on the risks we face. Our Risk Committee also reviews and oversees policies and practices established by management to identify, assess, measure and manage key risks we face, including the risk appetite metrics and risk appetite statement developed by management and approved by the Risk Committee. The Audit Committee of our Board is responsible for overseeing risks associated with financial matters (particularly financial reporting, accounting practices and policies, disclosure controls and procedures and internal control over financial reporting). The Compensation Committee of our Board has primary responsibility for risks and exposures associated with our compensation policies, plans and practices, regarding both executive compensation and the Company’s compensation structure generally. In particular, our Compensation Committee reviews our incentive compensation arrangements to ensure these programs are consistent with applicable laws and regulations, including safety and soundness requirements, and do not encourage imprudent or excessive risk-taking by our employees. The Nominating and Corporate Governance Committee of our Board oversees risks associated with the independence of our Board and potential conflicts of interest.

Our executive management team is responsible for implementing and reporting to our Board regarding our risk management processes, including by assessing and managing the risks we face, including strategic, operational, regulatory, investment and execution risks, on a day-to-day basis. Our executive management team is also responsible for creating and recommending to our Board for approval appropriate risk appetite metrics reflecting the aggregate levels and types of risk we are willing to accept in connection with the operation of our business and pursuit of our business objectives.

2025 Proxy Statement

The role of our Board in risk oversight is consistent with our leadership structure, with the members of our executive management team having responsibility for assessing and managing our risk exposure, and our Board and its committees providing oversight in connection with those efforts. We believe this division of risk management responsibilities presents a consistent, systemic and effective approach for identifying, managing and mitigating risks throughout our operations.

COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION

During 2024, Mary E. Zimmer, Galen G. Vetter, and Nikki L. Sorum served on our Compensation Committee. In February 2025, Jeffrey W. Bolton was added to the Compensation Committee. None of the members of our Compensation Committee will be or has been an officer or employee of the Company. None of our executive officers serves or has served as a member of the Board, compensation committee or other board committee performing equivalent functions of any entity that has one or more executive officers serving as one of our directors or on our Compensation Committee.

CORPORATE GOVERNANCE GUIDELINES

We have a set of Corporate Governance Guidelines in place that applies to all of our directors and employees. The guidelines set forth certain standards, requirements, and best practices that we expect all of our directors and employees to follow and is available on our website at investors.alerus.com.

CODE OF BUSINESS CONDUCT AND ETHICS

We have a Code of Business Conduct and Ethics in place that applies to all of our directors and employees. The code sets forth the standard of ethics that we expect all of our directors and employees to follow and is available on our website at investors.alerus.com. In accordance with SEC rules, we intend to disclose on the “Investor Relations” section of our website any amendments to the Code of Business Conduct and Ethics, or any waivers of its requirements, that apply to our executive officers to the extent such disclosure is required.

DIRECTOR COMPENSATION

Every year, our Compensation Committee reviews the competitiveness of our compensation for non-employee directors based on the results of an analysis by the Compensation Committee’s independent compensation consultant. We compensated our non-employee directors in 2024 with an annual retainer and additional fees for meeting attendance and service as a committee chair or as Board Chairman. Our annual retainer consisted of a cash payment of $40,000 and a grant of Company restricted stock with a grant date value equal to $50,000 with a vesting period the earlier of the first anniversary of the grant date and the next annual meeting of stockholders. Following the 2024 annual meeting of stockholders, committee Chair and Board Chairman fees increased as follows: Nominating and Corporate Governance and Risk Committee Chair fees increased from $6,000 to $8,000, Compensation Committee Chair fees increased from $7,500 to $8,000, and Board Chairman fees increased from $25,000 to $30,000. Mr. Vetter received $10,000 for serving as the Audit Committee Chair. Ms. Estep and Mr. Newman each received $7,000 for serving as the Nominating and Corporate Governance Committee Chair, and for serving as the Risk Committee Chair, respectively, and Ms. Zimmer received $7,750 for serving as the Compensation Committee Chair. Mr. Coughlin received $27,500 for serving as Board Chairman. For the first half of 2024, non-employee directors also received $1,000 for attending each quarterly committee meeting. The quarterly committee fees were eliminated following the 2024 annual meeting of stockholders. In the instance of special meetings, directors received $1,000 for meetings of three hours or less, and $2,000 for meetings longer than three hours.

The following table sets forth information regarding 2024 compensation for each of our non-employee directors. None of the directors receives any compensation or other payment in connection with his or her service as a director other than compensation received by the Company as described above and as set forth below.

NAME	FEES EARNED OR PAID IN CASH⁽¹⁾		STOCK AWARDS⁽²⁾		TOTAL
Daniel E. Coughlin	$	76,500	$	50,003	$	126,503
Randy L. Newman	$	53,000	$	50,003	$	103,003
Galen G. Vetter	$	57,000	$	50,003	$	107,003
Janet O. Estep	$	53,000	$	50,003	$	103,003
Mary E. Zimmer	$	54,750	$	50,003	$	104,753
John Uribe	$	48,000	$	50,003	$	98,003
Nikki L. Sorum	$	47,000	$	50,003	$	97,003
Jeffrey W. Bolton	$	24,333	$	29,166	$	53,499

⁽¹⁾

Reflects $40,000 in annual cash retainer fees, committee Chair fees as described above, as well as meeting and education event fees. Mr. Bolton's cash fees were prorated for joining the Board in October 2024. Directors may elect to defer up to 100% of their annual cash fees under the terms of the Deferred Compensation Plan, as described in more detail below. In 2024, both Mr. Vetter and Ms. Sorum elected to defer 100% of their annual cash fees.

⁽²⁾	The stock awards were granted under the Company's 2019 Equity Incentive Plan. Mr. Bolton received prorated stock grants as a result of his appointment to the Board in October 2024.

2025 Proxy Statement

EXECUTIVE OFFICERS

The business and banking background and experience of each of our executive officers, other than Ms. Lorenson, who also serves as a director and whose background and experience are set forth above, for at least the past five years is set forth below. No executive officer has any family relationship, as defined in Item 401 of Regulation S-K, with any other executive officer or any of our current directors. There are no arrangements or understandings between any of the officers and any other person pursuant to which he or she was selected as an officer.



Alan A. Villalon Executive Vice President and Chief Financial Officer

Age: 51 3 years with Alerus		Mr. Villalon joined the Company as Executive Vice President and Chief Financial Officer in 2022. He has over 25 years of industry experience, including a distinct background in financial analysis and investor relations. ■ Mr. Villalon previously served as Deputy Director of Investor Relations and Senior Vice President at U.S. Bank, a position he held from 2020 until 2022. ■ Prior to U.S. Bank, Mr. Villalon spent most of his career in equity analyst research roles, including serving as a Senior Research Analyst at Nuveen Asset Management/First American Funds Advisors. ■ Mr. Villalon holds a Bachelor’s degree in accounting from the University of Notre Dame and a Master’s degree in business administration from Carnegie Mellon University.


Jim R. Collins Executive Vice President and Chief Banking and Revenue Officer

Age: 53 3 years with Alerus		Mr. Collins serves as Executive Vice President and Chief Banking and Revenue Officer, a position he has occupied since 2022, overseeing our Company’s banking and wealth revenue-related functions including sales and business development, client segmentation, and client servicing. Mr. Collins has more than 30 years of commercial banking experience. ■ Before joining the Company, Mr. Collins served as the Minnesota regional Chief Executive Officer and President of corporate banking for Old National Bank. ■ Mr. Collins’ past experience includes various leadership roles for Anchor Bank over 13 years, including Senior Vice President of Commercial, Community and Wealth when Anchor Bank was acquired by Old National Bank in 2017.

2025 Proxy Statement

Karin M. Taylor Executive Vice President and Chief Operating Officer

Age: 57 7 years with Alerus		Ms. Taylor serves as Executive Vice President and Chief Operating Officer and joined the Company in 2018. Ms. Taylor has more than 30 years of industry experience ■ Ms. Taylor previously served as Chief Risk Officer at MidWestOne Bank and, prior thereto, as Chief Risk Officer for Central Bank, which was acquired by MidWestOne Financial Group, Inc. in 2015. ■ Prior to these roles, Ms. Taylor served as the Director of Risk Management Consulting at RSM (formerly, RSM McGladrey). ■ Ms. Taylor received a Bachelor of Arts degree from St. Olaf College and graduated with honors from the Graduate School of Banking at the University of Colorado, Boulder in 2018.


Forrest R. Wilson Executive Vice President and Chief Retirement Services Officer

Age: 55 1 year with Alerus		Mr. Wilson joined Alerus as Executive Vice President and Chief Retirement Services Officer in 2024. In this role, he is responsible for the overall leadership and direction of Alerus’ retirement and benefits division, which serves third-party advisors, plan sponsors, and participants nationwide. ■ Mr. Wilson is a well-rounded retirement industry professional with over 25 years of experience on both the platform/recordkeeping and investment sides of the business. He has extensive knowledge in sales and distribution growth, product oversight and strategy, acquisitions, digital engagement, implementation, and service delivery, and has experience with all types of defined contribution plans. ■ Before joining the Company, Mr. Wilson served as Senior Vice President of Retirement Plans Sales and Distribution at Ameritas Mutual Holding Company. ■ Mr. Wilson holds a bachelor’s degree in marketing from Central Connecticut State University and an MBA in finance and marketing from New York University Stern School of Business.



Missy S. Keney Executive Vice President and Chief Engagement Officer

Age: 43 20 years with Alerus		Ms. Keney serves as Executive Vice President and Chief Engagement Officer, a position she has occupied since 2022, overseeing our Company’s employee and client engagement strategies, including strategic alignment and planning in the areas of marketing and client experience, human resources, and facilities. ■ Ms. Keney joined the Company in 2005 and previously served as the Company’s Director of Marketing and Client experience. ■ Ms. Keney received a Bachelor of Science degree in business administration from North Dakota State University and also earned the Certified Financial Marketing Professional designation through the Institute of Certified Bankers.

2025 Proxy Statement

Compensation Discussion and Analysis

We became a public company in September 2019, and have filed with the SEC since that date under the scaled reporting rules applicable to “emerging growth companies.” As of January 1, 2025, we are no longer considered an emerging growth company and, therefore, the executive compensation disclosure included in this Proxy Statement contains additional information that was not required to be included in prior years’ proxy materials.

This Compensation Discussion and Analysis (“CD&A”) describes our compensation philosophy and policies as applicable to the named executive officers (“NEOs”) listed below for 2024. This CD&A also describes the Compensation Committee’s process for making pay decisions, as well as the rationale for specific decisions related to the fiscal year ended December 31, 2024.

NAMED EXECUTIVE OFFICERS

Our NEOs for 2024, which consist of our principal executive officer, our principal financial officer, and the Company’s three other most highly compensated executive officers, were:

■	Katie A. Lorenson, President and Chief Executive Officer;
■	Alan A. Villalon, Executive Vice President and Chief Financial Officer;
■	Jim R. Collins, Executive Vice President and Chief Banking and Revenue Officer;
■	Karin M. Taylor, Executive Vice President and Chief Operating Officer; and
■	Forrest R. Wilson, Executive Vice President and Chief Retirement Services Officer.

OUR COMPENSATION PHILOSOPHY AND GOVERNANCE PRACTICES

The Compensation Committee, which consists solely of independent directors, oversees our compensation program and reviews and approves the compensation of our NEOs. The primary objectives of our executive compensation program are to (1) align compensation programs with stockholder interests, (2) utilize compensation programs that support the Company’s core values and promote high ethical standards, (3) incorporate risk management features that encourage prudent decision-making without excessive risk, (4) ensure compensation programs reflect regulatory guidance, and (5) attract, motivate, and retain talented individuals. Our Board believes the executive compensation packages that we provide to our executives, including our NEOs, should include both cash and equity components that reward performance as measured against established Company goals. We compensate our NEOs with a combination of base salary, annual cash incentive bonuses, annual grants of equity, and other benefits (including perquisites). Each element is designed to achieve a specific purpose and to contribute to a total package that is competitive with similar packages provided by other institutions that compete for the services of individuals like our NEOs.

2025 Proxy Statement

Elements of Compensation

The Compensation Committee reviews and evaluates all components of each NEO’s total compensation package, including cash payments and non-cash incentives and benefits. The chart below summarizes the major elements of NEO compensation.

Pay Element	Key Characteristics	Why We Pay this Element	How We Determine the Amount	2024 Decisions
Base Salary	Fixed compensation paid in cash. Reviewed annually and adjusted when appropriate.	Provide a competitive base salary to attract and retain critical executive talent.	Experience, industry knowledge, peer data, company performance, and individual performance.	Base salary increases ranged from 3.6% to 9%.
Annual Bonus	Variable compensation paid in cash. Target bonuses are established as a percentage of annual salary, and payment is capped at 150% of target.	Motivate and reward executive officers for delivering on annual strategic objectives that contribute to the creation of shareholder value.	Market practices with payouts based on level of achievement of Company performance goals.	Annual bonus paid out at 104% of target for all NEOs.
Long-Term Incentives	Variable compensation paid in restricted stock units. NEOs receive 60% performance-based restricted stock units capped at 150% of target, and 40% time-based restricted stock units.	Motivate executives to execute on longer term financial goals that drive the creation of shareholder value in support of the Company’s strategic direction.	Market practices with payouts based on level of achievement of Company performance goals.	Performance-based restricted stock units for the 2022-2024 Long-Term Incentive Plan paid out at zero based on performance against three-year Cumulative Net Income target (as described in the "Equity Awards -- Long-Term Incentive Plan" section below).
Other Compensation and Perquisites	Compensation to provide basic competitive benefits.	Provide a base level of competitive compensation to attract and retain critical executive talent.	Periodic assessment of competitive offerings.	Beginning in 2024, annual executive physical exams were offered to all executives.

Role of the Compensation Committee

The Compensation Committee has overall responsibility for evaluating the compensation plans, policies, and programs relating to the NEOs. The Compensation Committee is comprised of independent directors of the Board. The Compensation Committee works very closely with its independent compensation consultant and management to examine the effectiveness of the Company’s executive compensation throughout the year. Details of the Compensation Committee’s authority and responsibilities are specified in its charter, which is available on our investor relations website at investors.alerus.com.

Members of our Board are, generally, free to attend committee meetings even where such Board members are not members of the particular committee. The Compensation Committee sometimes receives input from other members of the Board as the Compensation Committee is deliberating executive compensation related matters. The Compensation Committee considers such input if and as received, but does not specifically rely on such input in making executive compensation-related decisions.

Role of Executive Officers

As requested by the Compensation Committee, some members of management support the Compensation Committee’s review and consideration of executive compensation by providing information for the Compensation Committee’s review. The Compensation Committee relies upon the CEO’s assessment of each NEO’s individual performance. The Compensation Committee reviews and approves the corporate goals and objectives applicable to the compensation of the CEO and evaluates annually the CEO’s performance in light of those goals and objectives. The CEO also provides recommendations regarding compensation provided to NEOs (other than herself), technical and regulatory considerations, and input on program design and possible modifications.

The Compensation Committee holds final authority over all compensation decisions for the NEOs. The Compensation Committee has historically placed significant weight on the CEO’s recommendations with respect to compensation of NEOs (other than the CEO), but always maintains oversight and decisional authority with respect to NEO compensation. The CEO does not make recommendations to the Committee on her own pay levels. The Committee, in executive session, and without the CEO present, determines the pay levels for the CEO.

Independent Compensation Consultant

The Compensation Committee has the authority to directly select, engage, and terminate such counsel, consultants (including compensation consultants), and other experts it deems necessary or appropriate to assist it in carrying out its responsibilities. For 2024, the Compensation Committee retained FW Cook, a compensation consulting firm, to assess the effectiveness of the Company’s executive and director compensation programs. FW Cook is independent, reports directly to the Compensation Committee, and performs no other work for the Company other than assisting the Committee in its review of the Company’s executive and director compensation programs.

2025 Proxy Statement

The Compensation Committee utilized FW Cook’s 2024 reports to assist with executive and board compensation decisions in 2024, but did not rely solely on them. The Compensation Committee made all decisions based upon a balance of internal views, strategy, and external competitive factors, along with the outside perspective of FW Cook.

The Compensation Committee reviews the independence of its compensation consultants against the six “Independence Factors” described in the Nasdaq listing standards and applicable SEC guidance. For 2024, the Compensation Committee determined that FW Cook was independent.

Say-on-Pay Vote on Executive Compensation

In prior years, we were an “emerging growth company” as defined in the Jumpstart Our Business Act of 2012, and were not required to hold a say-on-pay vote on the compensation of our NEOs. Starting at the Annual Meeting, we will be conducting our first say-on-pay vote as described in Proposal 2 of this Proxy Statement. Because we value the opinions of our stockholders, our Board and Compensation Committee will consider the outcome of the say-on-pay vote, and the related say-on-frequency vote described in Proposal 3 of this Proxy Statement, as well as feedback received throughout the year, when making compensation decisions for our NEOs in the future.

Best Practices

The Compensation Committee reviews its policies and procedures to ensure they are consistent with strong corporate governance guidelines with the intention that our compensation philosophies promote high ethical standards and encourage prudent decision-making without excessive risk.

What We Do	What We Don’t Do
Align pay and performance	No guaranteed bonus for NEOs; incentive compensation may be reduced to zero if financial metrics are not met
Utilize a balanced mix of cash and equity compensation together with annual and long-term incentives	No excessive perquisites for our directors and NEOs
Independent third-party compensation consultant retained by and reports to the Compensation Committee	No uncapped incentive award payments
Peer group benchmarking	No highly leveraged incentive plans that encourage excessive risk taking
Maintain stock ownership guidelines for NEOs and directors	No hedging of stock
Maintain a clawback policy	No golden parachute excise tax gross ups
Conduct ongoing stockholder outreach and communications	No “single trigger” severance upon a change in control
Responsible use of shares under our 2019 Equity Incentive Plan	No dividends or dividend equivalents on unearned performance-based equity compensation

PEER GROUP SELECTION AND ANALYSIS

Since 2020, the Compensation Committee has worked with FW Cook to determine and utilize a peer group of publicly traded financial institutions which is typically evaluated annually and updated as needed. The 2024 peer group (“peer group”) is based on an analysis of publicly traded, diversified financial institutions to identify peers with similar characteristics to Alerus based on a variety of factors including commercial banks of similar asset size, financial performance, and similar business model traits such as more than 30% of revenue being driven by non-interest income or national companies with wealth management and similar assets under management. The Compensation Committee utilizes market data regarding the compensation practices of the peer group to establish compensation of the NEOs. The Compensation Committee benchmarks NEO compensation against the peer group median for each pay component, however the median is only a point of reference and NEOs may be positioned at a level less than or greater than the median based on time in position, experience, competitive pay objectives, and other factors. In connection with its 2024 analysis of the executive compensation peer group review, FW Cook compiled a market reference group of 20 other publicly traded companies with stable-to-strong performance history. The Compensation Committee believes this peer group is appropriate for comparative analysis, but the Compensation Committee does not base its executive compensation decisions solely upon the peer group comparison. The companies included in this peer group used for 2024 compensation decisions are listed below:

■	Bank First (BFC) – Manitowoc, Wisconsin

■	Cambridge Bancorp (CATC) – Acquired by Eastern Bankshares, Inc. in July 2024

2025 Proxy Statement

■	Cass Information Systems (CASS) – St. Louis, Missouri
■	Community Trust Bancorp (CTBI) – Pikeville, Kentucky
■	Financial Institutions (FISI) – Warsaw, New York
■	First Mid Bancshares (FMBH) – Mattoon, Illinois
■	First Western Financial (MYFW) – Denver, Colorado
■	German American Bancorp (GABC) – Jasper, Indiana
■	Great Southern Bancorp (GSBC) – Springfield, Missouri
■	Horizon Bancorp (HBNC) – Michigan City, Indiana
■	Independent Bank Corporation (IBCP) – Grand Rapids, Michigan

■	Lakeland Financial (LKFN) – Warsaw, Indiana
■	Midland States Bancorp (MSBI) – Effingham, Illinois
■	Peoples Bancorp (PEBO) – Marietta, Ohio
■	QCR Holdings (QCRH) – Moline, Illinois
■	Stock Yards Bancorp (SYBT) – Louisville, Kentucky
■	Univest Financial (UVSP) – Souderton, Pennsylvania
■	Waterstone Financial (WSBF) – Wauwatosa, Wisconsin
■	Westwood Holdings (WHG) – Dallas, Texas
■	1^st Source Corporation (SRCE) – South Bend, Indiana

2024 EXECUTIVE COMPENSATION PROGRAM

We compensate our NEOs with a combination of base salary, annual cash incentive bonuses, annual grants of equity, and other benefits (including perquisites). Each element is designed to achieve a specific purpose and to contribute to a total package that is competitive with similar packages provided by other institutions that compete for the services of individuals like our NEOs.

Base salary is an essential component to any market-competitive compensation program. Annual incentive rewards the achievement of short-term goals, while long-term incentives, like equity awards, serve as an important retention incentive and drive our NEOs to focus on long-term sustainable stockholder value creation. Based on our performance and consistent with the design of our program, the Compensation Committee made the following decisions relating to 2024 NEO compensation:

■	*Base Salary.* The Compensation Committee approved increases to base salaries for 2024 between 3.5% and 9.0%. See “Base Salary” within this CD&A for more information.

■	*Annual Bonus.* Based on circumstances that drove 2024 performance results, the Compensation Committee approved award payouts at 104.0% of target under the Company’s Short Term Incentive Plan. See “Annual Bonus - Short Term Incentive” within this CD&A for more information.

■

Equity Awards. Based on 2022-2024 financial performance, the Company did not achieve the threshold net income performance and the NEOs did not earn any performance equity awards. NEOs were granted time-based equity awards for the 2022-2024 period. See “Equity Awards – Long-Term Incentive” within this CD&A for more information.

BASE SALARY

On an annual basis, the Compensation Committee reviews and approves base salaries of NEOs. Base salary levels set the foundation for direct compensation, since the opportunity levels of our incentive plans (short- and long-term) are defined as a percentage of base salary. When setting base salary of the NEOs, the Compensation Committee considers input from FW Cook, the current market environment, and individual considerations with respect to each NEO. Individual considerations included professional experience and background of the NEO, the quality and effectiveness of their leadership at the Company, all other executive compensation including bonus, stock awards, retirement and other benefits and perquisites, and internal pay equity among the Company’s executives. The Committee approved raises for all NEOs for 2024 based on the factors described above. The base salaries for 2023 and 2024 are set forth below:

NAME

Position

2023 Base Salary

2024 Base Salary

Percent Change

Katie A. Lorenson⁽¹⁾

President and Chief Executive Officer

550,000

600,000

SEC Form DEF 14A filed by Alerus Financial Corporation