<PAGE> 1
As filed with the Securities and Exchange Commission on September 15, 1997
Registration No. 333-_________
- --------------------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
----------
FORM S-8
REGISTRATION STATEMENT UNDER
THE SECURITIES ACT OF 1933
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PINNACLE BANCSHARES, INC.
-------------------------
(Exact name of registrant as specified in its charter)
ALABAMA 72-1370314
------------------------------ -----------------
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
1811 SECOND AVENUE
JASPER, ALABAMA 35501
-------------------------------------
(Address of Principal Executive Office)
PINNACLE BANK
1996 STOCK OPTION AND INCENTIVE PLAN
------------------------------------
(Full title of the plan)
ROBERT B. NOLEN, JR.
PRESIDENT
PINNACLE BANCSHARES, INC.
1811 SECOND AVENUE
JASPER, ALABAMA 35501
-------------------------------------
(Name and address of agent for service)
(205) 221-4111
-----------------------------------------------------------
(Telephone number, including area code, of agent for service)
COPIES TO:
EDWARD B. CROSLAND, JR., ESQ.
REINHART, BOERNER, VAN DEUREN,
NORRIS & RIESELBACH, P.C.
601 PENNSYLVANIA AVENUE, N.W.
SUITE 750 NORTH BUILDING
WASHINGTON, D.C. 20004-2612
CALCULATION OF REGISTRATION FEE
<TABLE>
<CAPTION>
- ----------------------------------------------------------------------------------------------------------------
Proposed Maximum Proposed Maximum Amount of
Title of Securities Amount to be Offering Price Aggregate Offering Registration
to be registered registered Per Share Price Fee
- ----------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Common Stock,
$.01 par value 85,000(1) $________ (2) $2,003,437.50 (2) $608.00
- ----------------------------------------------------------------------------------------------------------------
</TABLE>
(1) Maximum number of shares issuable upon exercise of options granted or
to be granted under the Pinnacle Bank 1996 Stock Option and Incentive
Plan, as such amount may be increased in accordance with Section 12 of
said Plan in the event of a merger, consolidation, recapitalization or
similar event involving the registrant.
(2) Under Rule 457(h) the registration fee may be calculated based upon the
price at which the options may be exercised. 85,000 shares are being
registered hereby, of which 32,500 are under option at a weighted
average exercise price of $17.625 per share ($572,812.50 in the
aggregate). The remainder of the shares, which are not presently
subject to option (52,500 shares), are being registered based upon the
average of the high and low prices of $27.25 per share of Common Stock
on the American Stock Exchange on September 9, 1997 ($1,430,625 in the
aggregate). Accordingly, the total amount of the offering being
registered herein is $2,003,437.50.
<PAGE> 2
PART I
INFORMATION REQUIRED IN THE
SECTION 10(A) PROSPECTUS
ITEM 1. PLAN INFORMATION*
ITEM 2. REGISTRANT INFORMATION AND EMPLOYEE PLAN ANNUAL INFORMATION*
*Documents containing the information required by Part I of this
Registration Statement will be sent or given to participants in the Pinnacle
Bank 1996 Stock Option and Incentive Plan (the "Plan") in accordance with Rule
428(b)(1) of the General Rules and Regulations Under the Securities Act of 1933
(the "1933 Act"). In accordance with the Note to Part I of Form S-8, such
documents are not filed with the Securities and Exchange Commission (the
"Commission") either as part of this Registration Statement or as prospectuses
or prospectus supplements.
PART II
INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
ITEM 3. INCORPORATION OF DOCUMENTS BY REFERENCE
Pinnacle Bancshares, Inc. (the "Company") is subject to the
informational requirements of the Securities Exchange Act of 1934 (the "1934
Act") and, accordingly, files periodic reports and other information with the
Commission. Reports, proxy statements and other information concerning the
Company filed with the Commission may be inspected and copies may be obtained
(at prescribed rates) at the Commission's Public Reference Section, Room 1024,
450 Fifth Street, N.W., Washington, D.C. 20549.
The following documents are incorporated by reference in this
Registration Statement:
(a) The Company's Annual Report on Form 10-KSB for the fiscal year
ended December 31, 1996 (File No. 1-12707).
(b) The Company's Quarterly Report on Form 10-QSB for the quarter ended
March 31, 1997.
(c) The Company's Quarterly Report on Form 10-QSB for the quarter ended
June 30, 1997.
(d) The description of the Company's common stock, par value $0.01 per
share (the "Common Stock") contained in the Company's Registration Statement on
Form 8-A dated January 29, 1997.
ALL DOCUMENTS FILED BY THE COMPANY PURSUANT TO SECTIONS 13(A), 13(C),
14 AND 15(D) OF THE 1934 ACT AFTER THE DATE HEREOF AND PRIOR TO THE FILING OF A
POST-EFFECTIVE AMENDMENT WHICH INDICATES THAT ALL SHARES OF COMMON STOCK OFFERED
HEREBY HAVE BEEN SOLD OR WHICH DEREGISTERS ALL SUCH SHARES THEN REMAINING UNSOLD
SHALL BE DEEMED TO BE INCORPORATED BY REFERENCE IN THIS REGISTRATION STATEMENT
AND TO BE A PART HEREOF FROM THE DATE OF FILING OF SUCH DOCUMENTS.
ITEM 4. DESCRIPTIONS OF SECURITIES
Not applicable.
<PAGE> 3
ITEM 5. INTERESTS OF NAMED EXPERTS AND COUNSEL
Not Applicable.
ITEM 6. INDEMNIFICATION OF DIRECTORS AND OFFICERS
Directors, officers and employees of the Company may be entitled to
benefit from the indemnification provisions contained in the Delaware General
Corporation Law (the "DGCL") and the Company's Certificate of Incorporation. The
general effect of these provisions is summarized below:
Delaware General Corporation Law
Section 145 of the DGCL permits a Delaware corporation to indemnify any
person who was or is a party or is threatened to be made a party to any
proceeding of any type (other than an action by or in the right of the
corporation), by reason of the fact that he is or was a director, officer,
employee or agent of the corporation, or is or was serving at the request of the
corporation as a director, officer, employee or agent of another corporation,
partnership, joint venture, trust or other enterprise, against expenses
(including attorneys' fees), judgments, fines and amounts paid in settlement
actually and reasonably incurred by him in connection with such action, suit or
proceeding if he acted in good faith and in a manner he reasonably believed to
be in or not opposed to the best interests of the corporation, and, with respect
to any criminal action or proceeding, had no reasonable cause to believe his
conduct was unlawful. The termination of any action, suit or proceeding by
judgment, order, settlement, conviction, or upon a plea of nolo contendere or
its equivalent, may not, of itself, create a presumption that these standards
have not been met.
A Delaware corporation may also indemnify any person who was or is a
party or is threatened to be made a party to any proceeding by or in the right
of the corporation by reason of the fact that he is or was a director, officer,
employee or agent of the corporation, or is or was serving at the request of the
corporation as a director, officer, employee or agent of another corporation,
partnership, joint venture, trust or other enterprise against expenses
(including attorneys' fees) actually and reasonably incurred by him in
connection with the defense or settlement of such action or suit if he acted in
good faith and in a manner he reasonably believed to be in or not opposed to the
best interests of the corporation. However, no indemnification may be made in
respect of any claim, issue or matter as to which such person shall have been
adjudged to be liable to the corporation unless and only to the extent that the
Court of Chancery or the court in which such action or suit was brought
determines upon application that such person is fairly and reasonably entitled
to be indemnified.
To the extent that a director, officer, employee or agent of a
corporation has been successful on the merits or otherwise in defense of any
proceeding described above, indemnification against expenses (including
attorneys' fees) actually and reasonably incurred by him is mandatory.
Any determination that indemnification of the director, officer,
employee or agent is proper in the circumstances because he or she has met the
applicable standard of conduct noted above must be made by a majority of the
board of directors by a majority vote of a quorum consisting of directors who
were not parties to such action, suit or proceeding, or if such a quorum is not
obtainable, or, even if obtainable and a quorum of disinterested directors so
directs, by independent legal counsel in a written opinion, or by the
stockholders.
Expenses (including attorneys' fees) incurred by an officer or director
in defending any civil, criminal, administrative or investigative action, suit
or proceeding may be paid by the corporation in advance of the final disposition
of or proceeding upon receipt of an undertaking by or on behalf of such director
or officer to repay such amount if it shall ultimately be determined that he is
not entitled to be indemnified by the corporation.
The indemnification and advancement of expenses provided by, or granted
pursuant to, the other subsections of this section is not exclusive.
2
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In addition, a corporation shall have power to purchase and maintain
insurance against any liability of individuals whom the corporation is required
to indemnify.
Certificiate of Incorporation of the Company
The Company's Certificate of Incorporation provides for indemnification
of any individual who is or was a director, officer, employee or agent of the
Company in any proceeding in which the individual is made a party as a result of
his service in such capacity, if the individual acted in good faith and in a
manner he reasonably believed to be in, or not opposed to, the best interests of
the Company and, with respect to any criminal proceeding, he had no reasonable
cause to believe his conduct was unlawful, unless such indemnification would be
prohibited by law. This provision does not apply to conduct prior to the
incorporation of the Company or to conduct not as a director, officer, employee
or agent of the Company. In accordance with Delaware law, an individual may not
be indemnified (i) in connection with a proceeding by or in the right of the
Company in which the individual was adjudged liable to the Company or (ii) in
connection with any other proceeding charging improper personal benefit to him
in which he was adjudged liable on the basis that personal benefit was
improperly received by him, unless a court of competent jurisdiction determines
he is fairly and reasonably entitled to indemnification in view of all the
relevant circumstances.
The Company's Certificate of Incorporation also provides that a
director shall not be personally liable to the Company or its stockholders for
monetary damages for breach of his fiduciary duty as a director, except (i) for
breach of the director's duty of loyalty to the Company or its stockholders,
(ii) for acts or omissions that are not in good faith or that involve gross
negligence, intentional misconduct or a knowing violation of law, (iii) for
certain unlawful distributions, or (iv) for any transaction from which the
director derived an improper personal benefit.
ITEM 7. EXEMPTION FROM REGISTRATION CLAIMED
Not Applicable.
ITEM 8. EXHIBITS
For a list of all exhibits filed or included as part of this
Registration Statement, see "Index to Exhibits" at the end of this Registration
Statement.
ITEM 9. UNDERTAKINGS
1. The undersigned registrant will:
(a) file, during any period in which it offers or sells
securities, a post-effective amendment to this registration statement to:
(i) include any additional or changed material information on
the plan of distribution;
(b) for the purpose of determining liability under the
Securities Act, treat each post-effective amendment as a new registration
statement of the securities offered, and the offering of the securities at
that time to be the initial bona fide offering.
(c) file a post-effective amendment to remove from registration
any of the securities that remain unsold at the end of the offering.
3
<PAGE> 5
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the
Registrant certifies that it has reasonable grounds to believe that it meets all
of the requirements for filing on Form S-8 and has duly caused this Registration
Statement to be signed on its behalf by the undersigned thereunto duly
authorized, in the City of Jasper, State of Alabama, on September 12, 1997.
PINNACLE BANCSHARES, INC.
By: /s/ Robert B. Nolen, Jr.
-------------------------------------
Robert B. Nolen, Jr.
President and Chief Executive Officer
(Duly Authorized Representative)
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed by the following persons in the
capacities and on the date indicated.
We, the undersigned directors and officers of the Registrant, hereby
severally constitute and appoint Robert B. Nolen, Jr. our true and lawful
attorney and agent, to do any and all things in our names in the capacities
indicated below which said person may deem necessary or advisable to enable the
Registrant to comply with the Securities Act of 1933, as amended, and any rules,
regulations and requirements of the Securities and Exchange Commission, in
connection with the registration statement on Form S-8 relating to the offering
of the Registrant's Common Stock, including specifically, but not limited to,
power and authority to sign for us, in our names in the capacities indicated
below, the registration statement and any and all amendments (including
post-effective amendments) thereto; and we hereby approve, ratify and confirm
all that said person shall do or cause to be done by virtue thereof.
<TABLE>
<CAPTION>
Signatures Title Date
- ---------- ----- ----
<S> <C> <C>
/s/ Robert B. Nolen, Jr. Director, President and Chief September 12, 1997
- --------------------------- Executive Officer (Principal Executive
Robert B. Nolen, Jr. Officer and Principal Financial Officer)
/s/ Marie T. Guthrie Controller September 12, 1997
- ---------------------------
Marie T. Guthrie
/s/ Albert H. Simmons Chairman of the Board September 12, 1997
- ---------------------------
Albert H. Simmons
/s/ Greg Batchelor Director September 12, 1997
- ---------------------------
Greg Batchelor
/s/ O.H. Brown Director September 12, 1997
- ---------------------------
O.H. Brown
/s/ James W. Cannon Director September 12, 1997
- ---------------------------
James W. Cannon
</TABLE>
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<TABLE>
<CAPTION>
Signatures Title Date
- ---------- ----- ----
<S> <C> <C>
/s/ Melvin R. Kacharos Director September 12, 1997
- ---------------------------
Melvin R. Kacharos
/s/ Sam W. Murphy Director September 12, 1997
- ---------------------------
Sam W. Murphy
/s/ Max W. Perdue Director September 12, 1997
- ---------------------------
Max W. Perdue
/s/ J.T. Waggoner Director September 12, 1997
- ---------------------------
J.T. Waggoner
</TABLE>
<PAGE> 7
INDEX TO EXHIBITS
<TABLE>
<CAPTION>
Sequential
Exhibit Description
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<S> <C>
4.1 Pinnacle Bank 1996 Stock Option and Incentive Plan
4.2 Form of Stock Option Agreement to be entered into with Optionees
with respect to Incentive Stock Options
4.3 Form of Stock Option Agreement to be entered into with Optionees
with respect to Non-Incentive Stock Options
5 Opinion of Reinhart, Boerner, Van Deuren, Norris & Rieselbach, P.C.,
as to the validity of the Common Stock being registered
23.1 Consent of Reinhart, Boerner, Van Deuren, Norris & Rieselbach, P.C.
(appears in its opinion filed as Exhibit 5.1)
23.2 Consent of Independent Public Accountants
24 Power of Attorney of directors and officers of the Company
(included in the signature page to this Registration Statement)
</TABLE>
<PAGE> 1
EXHIBIT 4.1
<PAGE> 2
PINNACLE BANK
1996 STOCK OPTION AND INCENTIVE PLAN
1. PURPOSE OF THE PLAN.
The purpose of this Pinnacle Bank 1996 Stock Option and
Incentive Plan (the "Plan") is to advance the interests of the Bank
through providing select key Employees and Directors of the Bank and
its Affiliates with the opportunity to acquire Shares. By encouraging
such stock ownership, the Bank seeks to attract, retain and motivate
the best available personnel for positions of substantial
responsibility and to provide additional incentive to Directors and key
Employees of the Bank or any Affiliate to promote the success of the
business.
2. DEFINITIONS.
As used herein, the following definitions shall apply.
(a) "Affiliate" shall mean any "parent corporation" or "subsidiary
corporation" of the Bank, as such terms are defined in Section
424(e) and (f), respectively, of the Code.
(b) "Agreement" shall mean a written agreement entered into in
accordance with Paragraph 5(c).
(c) "Awards" shall mean, collectively, Options, SARs, and Restricted
Stock unless the context clearly indicates a different meaning.
(d) "Bank" shall mean Pinnacle Bank.
(e) "Board" shall mean the Board of Directors of the Bank.
(f) "Change in Control" shall mean any one of the following events:
(1) the ownership, holding or power to vote more than 25% of the
Bank's voting stock, (2) the control of the election of a
majority of the Bank's directors, (3) the exercise of a
controlling influence over the management or policies of the Bank
by any person or by persons acting as a group within the meaning
of Section 13(d) of the Securities Exchange Act of 1934 (except
in the case of (1), (2) and (3) hereof, ownership or control of
the Bank or its directors by a holding company formed by the Bank
shall not constitute a "Change in Control"), or (4) during any
period of two consecutive years, individuals who at the beginning
of such period constitute the Board of Directors of the Bank (the
"Bank Board") (the "Continuing Directors") cease for any reason
to constitute at least two-thirds thereof, provided that any
individual whose election or nomination for election as a member
of the Bank Board was approved by a vote of at least two-thirds
of the Continuing Directors then in office shall be considered a
Continuing Director. For purposes of this subparagraph only, the
term "person" refers to an individual or a corporation,
partnership, trust, association, joint venture, pool, syndicate,
sole proprietorship, unincorporated organization or any other
form of entity not specifically listed herein. The decision of
the Committee as to whether a change in control has occurred
shall be conclusive and binding.
(g) "Code" shall mean the Internal Revenue Code of 1986, as amended.
(h) "Committee" shall mean the Stock Option Committee appointed by
the Board in accordance with Paragraph 5(a) hereof.
(i) "Common Stock" shall mean the common stock, par value $.01 per
share, of the Bank.
<PAGE> 3
(j) "Continuous Service" shall mean the absence of any interruption
or termination of service as an Employee or Director of the Bank
or an Affiliate. Continuous Service shall not be considered
interrupted in the case of sick leave, military leave or any
other leave of absence approved by the Bank, in the case of
transfers between payroll locations of the Bank or between the
Bank, an Affiliate or a successor, or in the case of a Director's
performance of services in an emeritus or advisory capacity.
(k) "Director" shall mean any member of the Board, and any member of
the board of directors of any Affiliate that the Board has by
resolution designated as being eligible for participation in this
Plan.
(l) "Disability" shall mean a physical or mental condition, which in
the sole and absolute discretion of the Committee, is reasonably
expected to be of indefinite duration and to substantially
prevent a Participant from fulfilling his or her duties or
responsibilities to the Bank or an Affiliate.
(m) "Effective Date" shall mean the date specified in Paragraph 15
hereof.
(n) "Employee" shall mean any person employed by the Bank or an
Affiliate.
(o) "Exercise Price" shall mean the price per Optioned Share at which
an Option or SAR may be exercised.
(p) "ISO" means an option to purchase Common Stock which meets the
requirements set forth in the Plan, and which is intended to be
and is identified as an "incentive stock option" within the
meaning of Section 422 of the Code.
(q) "Market Value" shall mean the fair market value of the Common
Stock, as determined under Paragraph 7(b) hereof.
(r) "Non-Employee Director" shall mean any member of the Board who is
a Non-Employee Director within the meaning of Rule 16b-3.
(s) "Non-ISO" means an option to purchase Common Stock which meets
the requirements set forth in the Plan but which is not intended
to be and is not identified as an ISO.
(t) "Option" means an ISO and/or a Non-ISO.
(u) "Optioned Shares" shall mean Shares subject to an Award granted
pursuant to this Plan.
(v) "Participant" shall mean any person who receives an Award
pursuant to the Plan.
(w) "Plan" shall mean this Pinnacle Bank 1996 Stock Option and
Incentive Plan.
(x) "Restricted Stock" means Common Stock which is subject to
restrictions against transfer and forfeiture and such other terms
and conditions determined by the Committee, as provided in
Paragraph 11.
(y) "Rule 16b-3" shall mean Rule 16b-3 of the General Rules and
Regulations under the Securities Exchange Act of 1934, as
amended.
(z) "Share" shall mean one share of Common Stock.
(aa) "SAR" (or "Stock Appreciation Right") means a right to receive
the appreciation in value, or a portion of the appreciation in
value, of a specified number of shares of Common Stock.
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<PAGE> 4
(bb) "Year of Service" shall mean a full 12-month period, measured
from the date of an Award and each annual anniversary of that
date, during which a Participant has continuously been an
Employee or Director of the Bank or an Affiliate.
3. TERM OF THE PLAN AND AWARDS.
(a) Term of the Plan. The Plan shall continue in effect for a term of
10 years from the Effective Date, unless sooner terminated
pursuant to Paragraph 17 hereof. No Award shall be granted under
the Plan after 10 years from the Effective Date.
(b) Term of Awards. The term of each Award granted under the Plan
shall be established by the Committee, but shall not exceed 10
years; provided, however, that in the case of an Employee who
owns Shares representing more than 10% of the outstanding Common
Stock at the time an ISO is granted, the term of such ISO shall
not exceed five years.
4. SHARES SUBJECT TO THE PLAN.
(a) General Rule. The aggregate number of Shares deliverable pursuant
to Awards shall not exceed 85,000 Shares, as such number may be
adjusted on and after the Effective Date pursuant to Paragraph 12
hereof. Such Shares may either be authorized but unissued Shares,
Shares held in treasury, or Shares held in a grantor trust
created by the Bank. If any Awards should expire, become
unexercisable, or be forfeited for any reason without having been
exercised, the Optioned Shares shall, unless the Plan shall have
been terminated, be available for the grant of additional Awards
under the Plan.
(b) Special Rule for SARs. The number of Shares with respect to which
an SAR is granted, but not the number of Shares which the Bank
delivers or could deliver to an Employee or individual upon
exercise of an SAR, shall be charged against the aggregate number
of Shares remaining available under the Plan; provided, however,
that in the case of an SAR granted in conjunction with an Option,
under circumstances in which the exercise of the SAR results in
termination of the Option and vice versa, only the number of
Shares subject to the Option shall be charged against the
aggregate number of Shares remaining available under the Plan.
The Shares involved in an Option as to which option rights have
terminated by reason of the exercise of a related SAR, as
provided in Paragraph 10 hereof, shall not be available for the
grant of further Options under the Plan.
5. ADMINISTRATION OF THE PLAN.
(a) Composition of the Committee. The Plan shall be administered by
the Committee, which shall consist of not less than two members
of the Board who are Non-Employee Directors. Members of the
Committee shall serve at the pleasure of the Board. In the
absence at any time of a duly appointed Committee, the Plan shall
be administered by those members of the Board.
(b) Powers of the Committee. Except as limited by the express
provisions of the Plan or by resolutions adopted by the Board,
the Committee shall have sole and complete authority and
discretion (i) to select Participants and grant Awards, (ii) to
determine the form and content of Awards to be issued in the form
of Agreements under the Plan, (iii) to interpret the Plan, (iv)
to prescribe, amend and rescind rules and regulations relating to
the Plan, and (v) to make other determinations necessary or
advisable for the administration of the Plan. The Committee shall
have and may exercise such other power and authority as may be
delegated to it by the Board from time to time. A majority of the
entire Committee shall constitute a quorum and the action of a
majority of the members present at any meeting at which a quorum
is present, or acts
3
<PAGE> 5
approved in writing by a majority of the Committee without a
meeting, shall be deemed the action of the Committee.
(c) Agreement. Each Award shall be evidenced by a written agreement
containing such provisions as may be approved by the Committee.
Each such Agreement shall constitute a binding contract between
the Bank and the Participant, and every Participant, upon
acceptance of such Agreement, shall be bound by the terms and
restrictions of the Plan and of such Agreement. The terms of each
such Agreement shall be in accordance with the Plan, but each
Agreement may include such additional provisions and restrictions
determined by the Committee, in its discretion, provided that
such additional provisions and restrictions are not inconsistent
with the terms of the Plan. In particular, the Committee shall
set forth in each Agreement (i) the Exercise Price of an Option
or SAR, (ii) the number of Shares subject to, and the expiration
date of, the Award, (iii) the manner, time and rate (cumulative
or otherwise) of exercise or vesting of such Award, and (iv) the
restrictions, if any, to be placed upon such Award, or upon
Shares which may be issued upon exercise of such Award.
The Chairman of the Committee and such other Directors and
officers as shall be designated by the Committee are hereby
authorized to execute Agreements on behalf of the Bank and to
cause them to be delivered to the recipients of Awards.
(d) Effect of the Committee's Decisions. All decisions,
determinations and interpretations of the Committee shall be
final and conclusive on all persons affected thereby.
(e) Indemnification. In addition to such other rights of
indemnification as they may have, the members of the Committee
shall be indemnified by the Bank in connection with any claim,
action, suit or proceeding relating to any action taken or
failure to act under or in connection with the Plan or any Award,
granted hereunder to the full extent provided for under the
Bank's governing instruments with respect to the indemnification
of Directors.
6. GRANT OF OPTIONS.
(a) General Rule. In its sole discretion, the Committee may grant
Awards to Directors and select key Employees. In selecting those
Directors and Employees to whom Awards will be granted and the
number of shares covered by such Awards, the Committee shall
consider their respective positions, duties and responsibilities,
the value of their services to the Bank and its Affiliates, and
any other factors the Committee may deem relevant.
Notwithstanding the foregoing, the Committee shall automatically
make the Awards specified in Sections 6(b) and 6(d) hereof.
(b) Automatic Grants to Employees. On the Effective Date, each of the
following Employees shall receive an Option (in the form of an
ISO, to the extent permissible under the Code) to purchase the
number of Shares listed below, at an Exercise Price per Share
equal to the Market Value of a Share on the Effective Date;
provided that such grant shall not be made to an Employee whose
Continuous Service terminates on or before the Effective Date:
Robert B. Nolen, Jr. - 10,000 shares.
With respect to each of the above-named Employees, the
Option granted to the Employee hereunder (i) shall vest in
accordance with the general rule set forth in Paragraph 8(a) of
the Plan, (ii) shall have a term of ten years from the Effective
Date, except as limited by Paragraph 3(b), and (iii) shall be
subject to the general rule set forth in Paragraph 8(c) with
respect to the effect of a Employee's termination of Continuous
Service on the Employee's right to exercise his Options.
(c) Special Rules for ISOs. The aggregate Market Value, as of the
date the Option is granted, of the Shares with respect to which
ISOs are exercisable for the first time by an Employee during any
4
<PAGE> 6
calendar year (under all incentive stock option plans, as defined
in Section 422 of the Code, of the Bank or any present or future
Affiliate of the Bank) shall not exceed $100,000. Notwithstanding
the foregoing, the Committee may grant Options in excess of the
foregoing limitations, in which case such Options granted in
excess of such limitation shall be Options which are Non-ISOs.
(d) Automatic Grants to Directors. Notwithstanding any other
provisions of this Plan, each Director who is not an Employee but
is a Director on the Effective Date shall receive, on said date,
Non-ISOs to purchase 2,500 of the Shares reserved under Paragraph
4(a) hereof. Such Non-ISOs shall have an Exercise Price per Share
equal to the Market Value of a Share on the date of grant.
7. EXERCISE PRICE FOR OPTIONS.
(a) Limits on Committee Discretion. The Exercise Price as to any
particular Option shall not be less than 50% of the Market Value
of the Optioned Shares on the date of grant (100% in the case of
ISOs). In the case of an Employee who owns Shares representing
more than 10% of the Bank's outstanding Shares of Common Stock at
the time an ISO is granted, the Exercise Price shall not be less
than 110% of the Market Value of the Optioned Shares at the time
the ISO is granted.
(b) Standards for Determining Exercise Price. If the Common Stock is
listed on a national securities exchange (including the Nasdaq
National Market) on the date in question, then the Market Value
per Share shall be the average of the highest and lowest selling
price on such exchange on such date, or if there were no sales on
such date, then the Market Value per Share shall be the average
of the highest and lowest selling price on such exchange on the
trading day immediately preceding such date on which sales were
effected. If the Common Stock is traded otherwise than on a
national securities exchange on the date in question, then the
Market Value per Share shall be the mean between the bid and
asked price on such date, or, if there is no bid and asked price
on such date, then on the next prior business day on which there
was a bid and asked price. If no price is available, then the
Market Value per Share shall be its fair market value as
determined by the Committee, in its sole and absolute discretion.
Notwithstanding the foregoing, in the event that either (i) the
Committee exercises its discretion to impose transfer (or other)
restrictions on the Shares subject to an Option, or (ii) the Plan
requires specified transfer restrictions, the Committee shall
make an appropriate adjustment in determining the Market Value of
the Shares subject to such an Option (in order to take into
account that their fair market value may be less than the fair
market value of unrestricted Shares).
8. EXERCISE OF OPTIONS BY EMPLOYEES.
(a) Generally. Unless otherwise provided by the Committee pursuant to
an applicable Agreement, each Option shall be fully (100%)
exercisable after the six-month period following the date of its
grant, subject to Paragraph 14 hereof. An Option may not be
exercised for a fractional Share.
(b) Procedure for Exercise. An Employee may exercise Options, subject
to provisions relative to its termination and any limitations on
its exercise, only by (1) written notice of intent to exercise
the Option with respect to a specified number of Shares, and (2)
payment to the Bank (contemporaneously with delivery of such
notice) in cash, in Common Stock, or a combination of cash and
Common Stock, of the amount of the Exercise Price for the number
of Shares with respect to which the Option is then being
exercised. Each such notice (and payment where required) shall be
delivered, or mailed by prepaid registered or certified mail,
addressed to the Treasurer of the Bank at the Bank's executive
offices. Common Stock utilized in full or partial payment of the
Exercise Price for Options shall be valued at its Market Value at
the date of exercise, and may consist of Shares subject to the
Option being exercised. An Employee who exercises Non-ISOs
pursuant to this Paragraph may satisfy all applicable federal,
state and local income and employment tax withholding
obligations, in whole or in part, by irrevocably electing
5
<PAGE> 7
to have the Bank withhold shares of Common Stock, or to deliver
to the Bank shares of Common Stock that the Employee already
owns, having a value equal to the amount required to be withheld;
provided that to the extent not inconsistent herewith, such
election otherwise complies with those requirements of Paragraphs
8 and 20 hereof.
(c) Period of Exercisability. Except to the extent otherwise provided
in the terms of an Agreement, an Option may be exercised
hereunder only while the Employee is employed by the Bank and has
maintained Continuous Service from the date of the grant of the
Option, or within three months after termination of such
Continuous Service (but not later than the date on which the
Option would otherwise expire), except if the Employee's
Continuous Service terminates by reason of --
(1) "Just Cause" which for purposes hereof shall have the
meaning set forth in any unexpired employment or severance
agreement between the Employee and the Bank (and, in the
absence of any such agreement, shall mean termination
because of the Employee's personal dishonesty, incompetence,
willful misconduct, breach of fiduciary duty involving
personal profit, intentional failure to perform stated
duties, willful violation of any law, rule or regulation
(other than traffic violations or similar offenses) or final
cease-and-desist order), then the Employee's rights to
exercise such Option shall expire on the date of such
termination;
(2) Death, then to the extent that the Employee would have been
entitled to exercise the Option immediately prior to his
death, such Option of the deceased Employee may be exercised
within two years from the date of his death (but not later
than the date on which the Option would otherwise expire) by
the personal representatives of his estate or person or
persons to whom his rights under such Option shall have
passed by will or by laws of descent and distribution;
(3) Disability, then to the extent that the Employee would have
been entitled to exercise the Option immediately prior to
his or her Disability, such Option may be exercised within
one year from the date of termination of employment due to
Disability, but not later than the date on which the Option
would otherwise expire.
(d) Effect of the Committee's Decisions. The Committee's
determination whether an Employee's Continuous Service has
ceased, and the effective date thereof, shall be final and
conclusive on all persons affected thereby.
(e) Acceleration of Vesting. Notwithstanding the six-month period set
forth in Paragraph 8(a) hereof and except to the extent otherwise
provided in the terms of an Agreement, all Options held by an
Employee whose service with the Bank terminates due to death,
Disability, retirement after age 65, or a Change in Control shall
be deemed fully exercisable and non-forfeitable as of the
Employee's last day of service with the Bank, subject to the
provisions of Paragraph 8(c) hereof.
9. EXERCISE OF OPTIONS BY NON-EMPLOYEE DIRECTORS.
(a) Generally. Unless otherwise provided by the Committee pursuant to
an applicable Agreement, each Option shall be fully (100%)
exercisable after six months following the date of its grant,
subject to paragraph 14 hereof. An Option may not be exercised
for a fractional share.
(b) Terms of Exercise.
(i) Options received by Directors who are not Employees will
become exercisable in accordance with the general rule set
forth in Paragraph 8(a) hereof, and may be exercised from
time to time by (a) written notice of intent to exercise the
Option with respect to all or a specified number of the
Optioned Shares, and (b) payment to the Bank
6
<PAGE> 8
(contemporaneously with the delivery of such notice), in
cash, in Common Stock, or a combination of cash and Common
Stock, of the amount of the Exercise Price for the number of
the Optioned Shares with respect to which the Option is then
being exercised. Each such notice and payment shall be
delivered, or mailed by prepaid registered or certified
mail, addressed to the Treasurer of the Bank at the Bank's
executive offices. A Director who exercises Options may
satisfy all applicable federal, state and local income and
employment tax withholding obligations, in whole or in part,
by irrevocably electing to have the Bank withhold shares of
Common Stock, or to deliver to the Bank shares of Common
Stock that the Participant already owns, having a value
equal to the amount required to be withheld; provided that
to the extent not inconsistent herewith, such election
otherwise complies with those requirements of Paragraphs 8
and 20 hereof.
(ii) Options granted to Directors who are not Employees shall
have a term of 10 years; provided that Options so granted
shall expire one year after the date on which a Director
terminates Continuous Service on the Board, but in no event
later than the date on which such Options would otherwise
expire. In the event of such Director's death during the
term of his directorship, such Options shall become
immediately exercisable, and may be exercised within two
years from the date of his death by the personal
representatives of his estate or person or persons to whom
his rights under such Option shall have passed by will or by
laws of descent and distribution, but in no event later than
the date on which such Options would otherwise expire. In
the event of such Director's Disability during his or her
directorship, the Director's Option shall become immediately
exercisable, and such Option may be exercised within one
year of the termination of directorship due to Disability,
but not later than the date that the Option would otherwise
expire. Unless otherwise inapplicable or inconsistent with
the provisions of this Paragraph, the Options to be granted
to Directors hereunder shall be subject to all other
provisions of this Plan.
(c) Effect of the Committee's Decisions. The Committee's
determination whether a Director's Continuous Service has ceased,
and the effective date thereof, shall be final and conclusive on
all persons affected thereby.
(d) Acceleration of Vesting. Notwithstanding the six-month period set
forth in Paragraph 9(a) hereof and except to the extent otherwise
provided in the terms of an Agreement, all Options held by a
Director whose service with the Bank terminates due to death,
Disability, retirement after age 65, or a Change in Control shall
be deemed fully exercisable and non-forfeitable as of the
Director's last day of service with the Bank, subject to the
provisions of Paragraph 9(b) hereof.
10. SARS (STOCK APPRECIATION RIGHTS).
(a) Granting of SARs. In its sole discretion, the Committee may from
time to time grant SARs to Employees either in conjunction with,
or independently of, any Options granted under the Plan. An SAR
granted in conjunction with an Option may be an alternative right
wherein the exercise of the Option terminates the SAR to the
extent of the number of shares purchased upon exercise of the
Option and, correspondingly, the exercise of the SAR terminates
the Option to the extent of the number of Shares with respect to
which the SAR is exercised. Alternatively, an SAR granted in
conjunction with an Option may be an additional right wherein
both the SAR and the Option may be exercised. An SAR may not be
granted in conjunction with an ISO under circumstances in which
the exercise of the SAR affects the right to exercise the ISO or
vice versa, unless the SAR, by its terms, meets all of the
following requirements:
(1) The SAR will expire no later than the ISO;
7
<PAGE> 9
(2) The SAR may be for no more than the difference between the
Exercise Price of the ISO and the Market Value of the Shares
subject to the ISO at the time the SAR is exercised;
(3) The SAR is transferable only when the ISO is transferable,
and under the same conditions;
(4) The SAR may be exercised only when the ISO may be exercised;
and
(5) The SAR may be exercised only when the Market Value of the
Shares subject to the ISO exceeds the Exercise Price of the
ISO.
(b) Exercise Price. The Exercise Price as to any particular SAR shall
not be less than the Market Value of the Optioned Shares on the
date of grant.
(c) Timing of Exercise. Unless otherwise provided by the Committee
pursuant to an applicable Agreement, an SAR be exercised at any
time following the six-month period following the date of its
grant, subject to the provisions of Paragraph 8(c) regarding the
period of exercisability and the provisions of Paragraph 8(e)
regarding the acceleration of vesting.
(d) Exercise of SARs. An SAR granted hereunder shall be exercisable
at such times and under such conditions as shall be permissible
under the terms of the Plan and of the Agreement granted to a
Participant, provided that an SAR may not be exercised for a
fractional Share. Upon exercise of an SAR, the Participant shall
be entitled to receive, without payment to the Bank except for
applicable withholding taxes, an amount equal to the excess of
(or, in the discretion of the Committee if provided in the
Agreement, a portion of) the excess of the then aggregate Market
Value of the number of Optioned Shares with respect to which the
Participant exercises the SAR, over the aggregate Exercise Price
of such number of Optioned Shares. This amount shall be payable
by the Bank, in the discretion of the Committee, in cash or in
Shares valued at the then Market Value thereof, or any
combination thereof.
(e) Procedure for Exercising SARs. To the extent not inconsistent
herewith, the provisions of Paragraph 8(b) as to the procedure
for exercising Options are incorporated by reference, and shall
determine the procedure for exercising SARs.
11. RESTRICTED STOCK AWARDS.
Any Share of Restricted Stock which the Committee may grant to key
Employees shall be subject to the following terms and conditions, and to such
other terms and conditions as are either applicable generally to Awards, or
prescribed by the Committee in the applicable Agreement:
(a) Restriction Period. At the time of each award of Restricted
Stock, there shall be established for the Restricted Stock a
restriction period, which shall be no greater than 5 years (the
"Restriction Period"). The length of such Restriction Period may
differ among Participants and may have different expiration dates
with respect to portions of Shares of Restricted Stock covered by
the same award.
(b) Vesting Restrictions. The Committee shall determine the
restrictions applicable to the award of Restricted Stock,
including, but not limited to, requirements of Continuous Service
for a specified term, or the attainment of specific corporate,
divisional or individual performance standards or goals, which
restrictions may differ with respect to each Participant. The
Agreement shall provide for forfeiture of Shares covered thereby
if the specified restrictions are not met during the Restriction
Period, and may provide for early termination of any Restriction
Period in the event of satisfaction of the specified restrictions
prior to expiration of the Restricted Period.
8
<PAGE> 10
(c) Vesting. An amount equal to 20% of the Shares of Restricted Stock
subject to a Restricted Stock award shall be earned and become
non-forfeitable by a Participant upon his completion of each of
five Years of Service (subject to Committee discretion to impose
different vesting requirements but in no case may such vesting
requirement be for a period less than six months following the
grant of the SAR). For purposes of this paragraph, with respect
to each vesting event, "Year of Service" means a full 12-month
period, measured from the date of a Restricted Stock award and
each annual anniversary of that date, during which the
Participant has continuously been a Participant.
(d) Acceleration of Vesting. Notwithstanding the vesting schedule
contained in Paragraph 11(c) above, all Shares of Restricted
Stock held by a Participant whose service with the Bank
terminates due to death, Disability, retirement after age 65, or
a Change in Control, shall be deemed 100% earned and
non-forfeitable as of the Participant's last day of service with
the Bank and shall be distributed as soon as practicable
thereafter.
(e) Ownership; Voting. Stock certificates shall be issued in respect
of Restricted Stock awarded hereunder and shall be registered in
the name of the Participant, whereupon the Participant shall
become a stockholder of the Bank with respect to such Restricted
Stock and shall, to the extent not inconsistent with express
provisions of the Plan, have all the rights of a stockholder,
including but not limited to the right to receive all dividends
paid on such Shares and the right to vote such Shares. Said stock
certificates shall be deposited with the Bank or its designee,
together with a stock power endorsed in blank, and the following
legend shall be placed upon such certificates reflecting that the
Shares represented thereby are subject to restrictions against
transfer and forfeiture:
"The transferability of this certificate and the shares
of stock represented thereby are subject to the terms and
conditions (including forfeiture) contained in the Pinnacle
Bank 1996 Stock Option and Incentive Plan, and an agreement
entered into between the registered owner and Pinnacle Bank.
Copies of such Plan and Agreement are on file in the offices
of the Secretary of Pinnacle Bank."
(f) Lapse of Restrictions. At the expiration of the Restricted Period
applicable to the Restricted Stock, the Bank shall deliver to the
Participant, or the legal representative of the Participant's
estate, or if the personal representative of the Participant's
estate shall have assigned the estate's interest in the
Restricted Stock, to the person or persons to whom his rights
under such stock shall have passed by assignment pursuant to his
will or to the laws of descent and distribution, the stock
certificates deposited with it or its designee and as to which
the Restricted Period has expired and the requirements of the
restrictions have been met. If a legend has been placed on such
certificates, the Bank shall cause such certificates to be
reissued without the legend.
(g) Forfeiture of Restricted Stock. The Agreement shall provide for
forfeiture of any Restricted Stock which is not vested in the
Participant or for which the restrictions have not been satisfied
during the Restriction Period.
12. EFFECT OF CHANGES IN COMMON STOCK SUBJECT TO THE PLAN.
(a) Recapitalizations; Stock Splits, Etc. The number and kind of
shares reserved for issuance under the Plan, and the number and
kind of shares subject to outstanding Awards, and the Exercise
Price thereof, shall be proportionately adjusted for any
increase, decrease, change or exchange of Shares for a different
number or kind of shares or other securities of the Bank which
results from a merger, consolidation, recapitalization,
reorganization, reclassification, stock dividend, split-up,
combination of shares, or similar event in which the number or
kind of shares is changed without the receipt or payment of
consideration by the Bank.
9
<PAGE> 11
(b) Transactions in which the Bank is Not the Surviving Entity. In
the event of (i) the liquidation or dissolution of the Bank, (ii)
a merger or consolidation in which the Bank is not the surviving
entity, or (iii) the sale or disposition of all or substantially
all of the Bank's assets (any of the foregoing to be referred to
herein as a "Transaction"), all outstanding Awards, together with
the Exercise Prices thereof, shall be equitably adjusted for any
change or exchange of Shares for a different number or kind of
shares or other securities which results from the Transaction.
(c) Special Rule for ISOs. Any adjustment made pursuant to
subparagraphs (a) or (b)(1) hereof shall be made in such a manner
as not to constitute a modification, within the meaning of
Section 424(h) of the Code, of outstanding ISOs.
(d) Conditions and Restrictions on New, Additional, or Different
Shares or Securities. If, by reason of any adjustment made
pursuant to this Paragraph, a Participant becomes entitled to
new, additional, or different shares of stock or securities, such
new, additional, or different shares of stock or securities shall
thereupon be subject to all of the conditions and restrictions
which were applicable to the Shares pursuant to the Award before
the adjustment was made.
(e) Other Issuances. Except as expressly provided in this Paragraph,
the issuance by the Bank or an Affiliate of shares of stock of
any class, or of securities convertible into Shares or stock of
another class, for cash or property or for labor or services
either upon direct sale or upon the exercise of rights or
warrants to subscribe therefor, shall not affect, and no
adjustment shall be made with respect to, the number, class, or
Exercise Price of Shares then subject to Awards or reserved for
issuance under the Plan.
13. NON-TRANSFERABILITY OF AWARDS.
Awards may not be sold, pledged, assigned, hypothecated,
transferred or disposed of in any manner other than by will or by the
laws of descent and distribution. Notwithstanding any other provision
of this Plan to the contrary, to the extent permissible under Rule
16b-3, and except to the extent otherwise provided in the terms of an
Agreement, a Participant who is granted Non-ISOs pursuant to this Plan
may transfer such Non-ISOs to his or her spouse, lineal ascendants,
lineal descendants, or to a duly established trust, provided that
Non-ISOs so transferred may not again be transferred other than (i) to
the Participant originally receiving the grant of Non-ISOs, or (ii) to
an individual or trust to whom such Participant could have transferred
Non-ISOs pursuant to this Paragraph 13. Non-ISOs which are transferred
pursuant to this Paragraph 13 shall be exercisable by the transferee
subject to the same terms and conditions as would have applied to such
Non-ISOs in the hands of the Participant originally receiving the grant
of such Non-ISOs.
14. TIME OF GRANTING AWARDS.
The date of grant of an Award shall, for all purposes, be the
later of the date on which the Committee makes the determination of
granting such Award, and the Effective Date. Notice of the
determination shall be given to each Participant to whom an Award is so
granted within a reasonable time after the date of such grant.
15. EFFECTIVE DATE.
The Plan shall become effective immediately upon its approval
by the Board, subject to stockholder approval as may be required.
10
<PAGE> 12
16. MODIFICATION OF AWARDS.
At any time, and from time to time, the Board may authorize
the Committee to direct execution of an instrument providing for the
modification of any outstanding Award, provided no such modification
shall confer on the holder of said Award any right or benefit which
could not be conferred on him by the grant of a new Award at such time,
or impair the Award without the consent of the holder of the Award.
17. AMENDMENT AND TERMINATION OF THE PLAN.
The Board may from time to time amend the terms of the Plan
and, with respect to any Shares at the time not subject to Awards,
suspend or terminate the Plans. No amendment, suspension or termination
of the Plan shall, without the consent of any affected holders of an
Award, alter or impair any rights or obligations under any Award
theretofore granted.
18. CONDITIONS UPON ISSUANCE OF SHARES.
(a) Compliance with Securities Laws. Shares of Common Stock shall not
be issued with respect to any Award unless the issuance and
delivery of such Shares shall comply with all relevant provisions
of law, including, without limitation, the Securities Act of
1933, as amended, the rules and regulations promulgated
thereunder, any applicable state securities law, and the
requirements of any stock exchange upon which the Shares may then
be listed.
(b) Special Circumstances. The inability of the Bank to obtain
approval from any regulatory body or authority deemed by the
Bank's counsel to be necessary to the lawful issuance and sale of
any Shares hereunder shall relieve the Bank of any liability in
respect of the non-issuance or sale of such Shares. As a
condition to the exercise of an Option or SAR, the Bank may
require the person exercising the Option or SAR to make such
representations and warranties as may be necessary to assure the
availability of an exemption from the registration requirements
of federal or state securities law.
(c) Committee Discretion. The Committee shall have the discretionary
authority to impose in Agreements such restrictions on Shares as
it may deem appropriate or desirable, including but not limited
to the authority to impose a right of first refusal or to
establish repurchase rights or both of these restrictions.
19. RESERVATION OF SHARES.
The Bank, during the term of the Plan, will reserve and keep
available a number of Shares sufficient to satisfy the requirements of
the Plan.
20. WITHHOLDING TAX.
The Bank's obligation to deliver Shares upon exercise of
Options and/or SARs shall be subject to the Participant's satisfaction
of all applicable federal, state and local income and employment tax
withholding obligations.
21. NO EMPLOYMENT OR OTHER RIGHTS.
In no event shall an Employee's or Director's eligibility to
participate or participation in the Plan create or be deemed to create
any legal or equitable right of the Employee, Director, or any other
party to continue service with the Bank or any Affiliate of such
corporations. Except to the extent provided in Paragraphs 6(b) and
6(d), no Employee or Director shall have a right to be granted an Award
or, having received an Award, the right to again be granted an Award.
However, an Employee or Director who has been granted an Award may, if
otherwise eligible, be granted an additional Award or Awards.
11
<PAGE> 13
22. GOVERNING LAW.
The Plan shall be governed by and construed in accordance with
the laws of the State of Alabama, except to the extent that federal law
shall be deemed to apply.
12
<PAGE> 1
EXHIBIT 4.2
<PAGE> 2
STOCK OPTION AGREEMENT
FOR INCENTIVE STOCK OPTIONS UNDER SECTION 422
OF THE INTERNAL REVENUE CODE
PURSUANT TO THE
PINNACLE BANK
1996 STOCK OPTION AND INCENTIVE PLAN
STOCK OPTION for a total of _____ shares of Common Stock, par value
$.01 per share (the "Common Stock"), of Pinnacle Bancshares, Inc. (the
"Company"), which Option is intended to qualify as an incentive stock option
under Section 422 of the Internal Revenue Code of 1986, as amended, is hereby
granted to _________________________ (the "Optionee") at the price set forth
herein, and in all respects subject to the terms, definitions and provisions of
the Pinnacle Bank 1996 Stock Option and Incentive Plan (the "Plan") adopted by
the Company which is incorporated by reference herein, receipt of which is
hereby acknowledged.
1. Option Price. The option price is $_____ for each share, being
100%(1) of the fair market value, as determined by the Stock Option Committee,
of the Common Stock on the date of grant of this option.
2. Exercises of Option. This Option shall be exercisable in accordance
with provisions of the Plan as follows:
(i) Schedule of rights to exercise.
<TABLE>
<CAPTION>
Years of Service Shares Subject to Option Which May
After Date of Grant of Option Be Exercised
--------------------------------- ----------------------------------
<S> <C>
Upon Grant _______________
1 year but less than 2 years _______________
2 years but less than 3 years _______________
3 years but less than 4 years _______________
4 years but less than 5 years _______________
Over 5 years _______________
</TABLE>
- --------
(1) 110% in the case of an Optionee who owns shares representing more than 10%
of the outstanding common stock of the Company on the date of grant of
this Option.
<PAGE> 3
(ii) Method of Exercise. This Option shall be exercisable by a written
notice by the Optionee which shall:
(a) State the election to exercise the Option, the number of shares with
respect to which it is being exercised, the person in whose name the stock
certificate or certificates for such shares of Common Stock is to be
registered, his address and Social Security Number (or if more than one,
the names, addresses and Social Security Numbers of such persons);
(b) Contain such representations and agreements as to the holder's
investment intent with respect to such shares of Common Stock as may be
satisfactory to the Company's counsel;
(c) Be signed by the person or persons entitled to exercise the Option and,
if the Option is being exercised by any person or persons other than the
Optionee, be accompanied by proof, satisfactory to counsel for the Company,
of the right of such person or persons to exercise the Option; and
(d) Be in writing and delivered in person or by certified mail to the
Treasurer of the Company.
Payment of the purchase price of any shares with respect to which the
Option is being exercised shall be by cash, Common Stock, or such a combination
of cash and Common Stock as the Optionee elects. The certificate or certificates
for shares of Common Stock as to which the Option shall be exercised shall be
registered in the name of the person or persons exercising the Option.
(iii) Restrictions on exercise; Securities registration. This Option may
not be exercised if the issuance of the shares upon such exercise would
constitute a violation of any applicable federal or state securities or other
law or valid regulation. As a condition to the Optionee's exercise of this
Option, the Company may require the Optionee to make any representation and
warranty to the Company as may be required by any applicable law or regulation,
including such representations and warranties as may be necessary to assure the
availability of an exemption from the registration requirements of federal or
state securities laws.
2
<PAGE> 4
3. Withholding. The Optionee hereby agrees that the exercise of the Option
or any installment thereof will not be effective, and no shares will become
transferable to the Optionee, until the Optionee makes appropriate arrangements
with the Company for such tax withholding as may be required of the Company
under federal, state or local law on account of such exercise.
4. Non-transferability of Option. This option may not be transferred in any
manner otherwise than by will or the laws of descent or distribution and may be
exercised during the lifetime of the Optionee only by the Optionee. The terms of
this Option shall be binding upon the executors, administrators, heirs,
successors and assigns of the Optionee.
5. Term of Option. This Option may not be exercisable for more than
__________(2) years from the date of grant of this Option, as stated below, and
may be exercised during such term only in accordance with the Plan and the terms
of this Option.
PINNACLE BANCSHARES, INC.
By: _____________________________________
Attest: _________________________________
- -----------
Date of Grant
(Seal)
- ----------
(2) No more than ten years; five years in the case of an Optionee who owns
shares representing more than 10% of the outstanding Common Stock of the
Company on the date of grant of this Option.
3
<PAGE> 1
EXHIBIT 4.3
<PAGE> 2
- --------------------------------------------------------------------------------
STOCK OPTION AGREEMENT
- --------------------------------------------------------------------------------
FOR NON-INCENTIVE STOCK OPTIONS PURSUANT TO THE
PINNACLE BANK
1996 STOCK OPTION AND INCENTIVE PLAN
STOCK OPTION for a total of _____ shares of Common Stock, par value
$.01 per share (the "Common Stock"), of Pinnacle Bancshares, Inc. (the
"Company") is hereby granted to ________________________ (the "Optionee") at the
price set forth herein, and in all respects subject to the terms, definitions
and provisions of the Pinnacle Bank 1996 Stock Option and Incentive Plan (the
"Plan") adopted by the Company which is incorporated by reference herein,
receipt of which is hereby acknowledged. Such Stock Options do not comply with
Options granted under Section 422 of the Internal Revenue Code of 1986, as
amended.
1. Option Price. The option price is $ _____ for each share.
2. Exercises of Option. This Option shall be exercisable in accordance
with provisions of the Plan as follows:
(i) Schedule of rights to exercise.
<TABLE>
<CAPTION>
Years of Service Shares Subject to Option Which May
After Date of Grant of Option Be Exercised
--------------------------------- ----------------------------------
<S> <C>
Upon Grant _______________
1 year but less than 2 years _______________
2 years but less than 3 years _______________
3 years but less than 4 years _______________
4 years but less than 5 years _______________
Over 5 years _______________
</TABLE>
(ii) Method of Exercise. This Option shall be exercisable by a
written notice which shall:
(a) State the election to exercise the Option, the number of shares with
respect to which it is being exercised, the person in whose name the stock
certificate or certificates for such shares of Common Stock is to be
registered, his address and Social Security Number (or if more than one,
the names, addresses and Social Security Numbers of such persons);
<PAGE> 3
(b) Contain such representations and agreements as to the holder's
investment intent with respect to such shares of Common Stock as may be
satisfactory to the Company's counsel;
(c) Be signed by the person or persons entitled to exercise the Option and,
if the Option is being exercised by any person or persons other than the
Optionee, be accompanied by proof, satisfactory to counsel for the Company,
of the right of such person or persons to exercise the Option; and
(d) Be in writing and delivered in person or by certified mail to the
Treasurer of the Company.
Payment of the purchase price of any shares with respect to which the
Option is being exercised shall be by cash, Common Stock, or such a combination
of cash and Common Stock as the Optionee elects. The certificate or certificates
for shares of Common Stock as to which the Option shall be exercised shall be
registered in the name of the person or persons exercising the Option.
(iii) Restrictions on exercise: Securities Registration. The Option may not
be exercised if the issuance of the shares upon such exercise would constitute a
violation of any applicable federal or state securities or other law or valid
regulation. As a condition to his exercise of this Option, the Company may
require the Optionee to make any representation and warranty to the Company as
may be required by any applicable law or regulation, including such
representations and warranties as may be necessary to assure the availability of
an exemption from the registration requirements of federal or state securities
laws.
3. Withholding. The Optionee hereby agrees that the exercise of the Option
or any installment thereof will not be effective, and no shares will become
transferable to the Optionee, until the Optionee makes appropriate arrangements
with the Company for such tax withholding as may be required of the Company
under federal, state or local law on account of such exercise.
4. Non-transferability of Option. This Option may not be transferred in any
manner otherwise than by will or the laws of descent or distribution and may be
exercised during the lifetime of the Optionee only by him. The terms of this
Option shall be binding upon the executors, administrators, heirs, successors
and assigns of the Optionee.
2
<PAGE> 4
5. Term of Option. This Option may not be exercisable for more than
__________ years from the date of grant of this Option, as set forth below, and
may be exercised during such term only in accordance with the Plan and the terms
of this Option.
PINNACLE BANCSHARES, INC.
By: _____________________________________
Attest: _________________________________
- --------------
Date of Grant
(Seal)
3
<PAGE> 1
EXHIBIT 5
<PAGE> 2
September 12, 1997
Board of Directors
Pinnacle Bancshares, Inc.
1811 Second Avenue
Jasper, Alabama 35501
Gentlemen: Re: Pinnacle Bank 1996 Stock Option
and Incentive Plan;
Registration Statement on Form S-8
We have acted as special counsel to Pinnacle Bancshares, Inc., a
Delaware corporation (the "Company"), in connection with the preparation of the
Registration Statement on Form S-8 filed with the Securities and Exchange
Commission (the "Registration Statement") under the Securities Act of 1933, as
amended, relating to 85,000 shares of common stock, par value $0.01 per share
(the "Common Stock"), of the Company which may be issued under the Pinnacle Bank
1996 Stock Option and Incentive Plan (the "Plan"), all as more fully described
in the Registration Statement. You have requested the opinion of this firm with
respect to certain legal aspects of the proposed offering.
We have examined such documents, records and matters of law as well
have deemed necessary for purposes of this opinion and, based thereon, we are of
the opinion that the Common Stock, when issued in accordance with the terms of
the Plan, will be duly and validly issued, fully paid and nonassessable.
We hereby consent to the filing of this opinion as an exhibit to the
Registration Statement and to references to our firm included under the caption
"Legal Opinion" in the Prospectus which is part of the Registration Statement.
Very truly yours,
REINHART, BOERNER, VAN DEUREN,
NORRIS & RIESELBACH, P.C.
By: /s/ Edward B. Crosland, Jr.
---------------------------
Edward B. Crosland, Jr.
<PAGE> 1
EXHIBIT 23.2
<PAGE> 2
CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS
As independent public accountants, we hereby consent to the
incorporation by reference in this Registration Statement of our report dated
January 24, 1997 included in Pinnacle Bank's Annual Report on Form 10-KSB and to
all references to our Firm in this Registration Statement.
/s/ Arthur Andersen LLP
--------------------------------
Arthur Andersen LLP
Birmingham, Alabama
September 10, 1997
