PRINCETON NATIONAL BANCORP INC
S-8, 1998-09-01
NATIONAL COMMERCIAL BANKS
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                  AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION
                                ON SEPTEMBER 1, 1998

                                 REGISTRATION NO. 333-______________________
____________________________________________________________________________
____________________________________________________________________________
                                  UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION

                             Washington, D.C.  20549
                        ________________________________
                                    FORM S-8

                             REGISTRATION STATEMENT
                                      UNDER
                           THE SECURITIES ACT OF 1933
                        ________________________________
                        PRINCETON NATIONAL BANCORP, INC.
             (EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)

               DELAWARE                                       36-3210283
     (State or other jurisdiction of                      (I.R.S. employer
     incorporation or organization)                       identification no.)

                               606 S. Main Street
                           Princeton, Illinois  62356
          (Address of principal executive offices, including zip code)

                        PRINCETON NATIONAL BANCORP, INC.
                          EMPLOYEE STOCK PURCHASE PLAN
                            (Full title of the plan)

                                 TONY J. SORCIC
                                    PRESIDENT
                        PRINCETON NATIONAL BANCORP, INC.
                              606 SOUTH MAIN STREET
                            PRINCETON, ILLINOIS 62356
                     (Name and address of agent for service)

                                 (815) 875-4444
          (Telephone number, including area code, of agent for service)

                                 WITH A COPY TO:

                               TIMOTHY E. KRAEPEL
                         HOWARD & HOWARD ATTORNEYS, P.C.
                     THE PINEHURST OFFICE CENTER, SUITE 101
                           1400 NORTH WOODWARD AVENUE
                         BLOOMFIELD HILLS, MI 48304-2856
                                 (248) 645-1483
                        ________________________________

                         CALCULATION OF REGISTRATION FEE

<TABLE>
<S>                                       <C>          <C>         <C>
Title of Securities to be Registered                  Proposed     Proposed
                                          Amount       maximum     maximum
                                          to be        offering    aggregate
                                          registered   price       offering
                                                       per share    price
                                                         (1)         (1)

Common Stock, par value $5.00 per share   20,000       $20.125     $402,500
</TABLE>

<TABLE>
<S>                                       <C>
Title of Securities to be Registered      Amount of
                                          registration
                                          fee

                                          $119.00

</TABLE>

(1)  Estimated solely for purposes of calculating the registration fee in
accordance with Rule 457(c) and (h).

                               Page 1 of 13 Pages
                       The Exhibit Index Appears on Page 5

                              GENERAL INSTRUCTIONS

E.   REGISTRATION OF ADDITIONAL SECURITIES

     The contents of the registration statements on Form S-8 (File Nos. 33-
86708 and 33-98686) filed by the registrant with the Securities and Exchange
Commission on December 1, 1994 and October 26, 1995, respectively, registering
its Common Stock, par value $5.00 per share, issuable pursuant to the Princeton
National Bancorp, Inc. Employee Stock Purchase Plan, are hereby incorporated by
reference.

     All information required in this registration statement not included in
the exhibits attached hereto or set forth on the signature page is set forth in
the registration statements of the registrant on Form S-8 (File Nos. 33-86708
and 33-98686), which are incorporated herein by reference.


                                     PART II

               INFORMATION REQUIRED IN THE REGISTRATION STATEMENT

ITEM 8.   EXHIBITS.

     The exhibits filed herewith or incorporated by reference herein are set
forth in the Exhibit index filed as part of this registration statement on page
5 hereof.

                                   SIGNATURES

     THE REGISTRANT.  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 Princeton, State of Illinois, on
August 31, 1998


                                 PRINCETON NATIONAL BANCORP
                                     (Registrant)


                                By:  /s/ TONY J. SORCIC
                                   _________________________________________
                                     Tony J. Sorcic
                                     President

                                  POWER OF ATTORNEY

     Each person whose signature appears below appoints Tony J. Sorcic, as such
person's true and lawful attorney to execute in the name of each such person,
and to file, any amendments to this registration statement that such attorney
may deem necessary or desirable 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 with respect thereto, in
connection with the registration of the shares of Common Stock, which
amendments may make such changes in such registration statement as the above-
named attorney deems appropriate, and to comply with the undertakings of the
Registrant made in connection with this registration statement; and each of the
undersigned hereby ratifies all that said attorney will do or cause to be done
by virtue hereof.

     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 dates indicated.

        SIGNATURE                     TITLE                      DATE

/s/ TONY J. SORCIC                   President             August 31, 1998
_____________________________   (Principal Executive
Tony J. Sorcic                  Officer) and Director

/s/ TODD D. FANNING                Vice President          August 31, 1998
_____________________________   (Principal Accounting
Todd D. Fanning                 and Financial Officer)

_____________________________   Chairman of the Board      August 31, 1998
Thomas R. Lasier                and Director

_____________________________   Director                   August 31, 1998
Don S. Browning

/s/ JOHN R. ERNAT               Director                   August 31, 1998
______________________________
John R. Ernat

/s/ DONALD E. GRUBB             Director                   August 31, 1998
______________________________
Donald E. Grubb

/s/ HAROLD C. HUTCHINSON, JR.   Director                   August 31, 1998
______________________________
Dr. Harold C. Hutchinson, Jr.

/s/ THOMAS M. LONGMAN           Director                   August 31, 1998
______________________________
Thomas M. Longman

_____________________________   Director                   August 31, 1998
Ervin I. Pietsch

_____________________________   Director                   August 31, 1998
Stephen W. Samet

/s/ CRAIG O. WESNER             Director                   August 31, 1998
_____________________________
Craig O. Wesner

<PAGE>
                                  EXHIBIT INDEX

EXHIBIT                                                SEQUENTIALLY
NUMBER               DESCRIPTION                       NUMBERED PAGE

4.1       Princeton National Bancorp, Inc. Amended
            and Restated Employee Stock Purchase
          Plan.                                                6

5.1       Opinion of Howard & Howard Attorneys, P.C.          12

23.1      Consent of KPMG Peat Marwick LLP.                   13

23.2      Consent of Howard & Howard Attorneys, P.C.
          (contained in their opinion filed as
          Exhibit 5).

24        Powers of Attorney (contained on the
          signature pages hereto).


                                                                 EXHIBIT 4.1

                        PRINCETON NATIONAL BANCORP, INC.
                              AMENDED AND RESTATED
                          EMPLOYEE STOCK PURCHASE PLAN


     WHEREAS, Princeton National Bancorp, Inc., a Delaware corporation (the
"Company"), desires to establish the Princeton National Bancorp, Inc. Employee
Stock Purchase Plan (the "Plan") to provide a convenient and economical way
for certain employees of the Company or its subsidiaries to commence or
increase their ownership of the Company's common stock;

     NOW, THEREFORE, the Company hereby establishes the Plan, effective
January 1, 1995, the terms of which shall be as follows:

     1.   DEFINITIONS.  Wherever used herein, the following words and phrases
shall have the meanings stated below unless a different meaning is plainly
required by the content:

               (a)"BOARD" means the Board of Directors of the Company.

               (b)"COMMON STOCK" means shares of the common stock of the
Company, $5.00 par value per share.

               (c)"ELIGIBLE DIRECTOR" means each person who is not employed by
the Company or a Subsidiary, who from time to time serves on the Board or on
the board of directors of a Subsidiary, and who has been designated by the
Board as eligible to purchase Common Stock under the Plan.

               (d)"ELIGIBLE EMPLOYEE" means each person who is employed by
the Company or a Subsidiary and who has been designated by the Board as
eligible to purchase Common Stock under the Plan.

               (e)"INVESTMENT DATE" means the last business day of each
quarter (i.e., March 31, June 30, September 30 and December 31).

               (f)"PARTICIPANT" means an Eligible Director or an Eligible
Employee who has elected to participate in the Plan by completing an
Authorization Card and making a lump-sum contribution or authorizing payroll
deductions pursuant to Sections 5 and 6 of the Plan.

               (g)"SUBSIDIARY" or "SUBSIDIARIES" means a corporation or
corporations that, with the Company, is a member of a controlled group of
corporations (as defined in Section 1563 of the Internal Revenue Code).

     2.   PURPOSE.  The purpose of the Plan is to give Eligible Directors and
Eligible Employees of the Company and its Subsidiaries an opportunity to
acquire shares of Common Stock, and to promote the best interests of the
Company and enhance its long-term performance.  Once an Eligible Director or
Eligible Employee is a Participant in the Plan, his lump-sum contributions
and/or payroll deductions will be used to purchase Common Stock under the
terms of the Plan during the period of time that such Eligible Director or
Eligible Employee is a Participant.  Participants shall pay no brokerage
commissions or service charges for purchases made under the Plan.  The Plan is
not subject to the provisions of the Employee Retirement Income Security Act
of 1974.

     3.   ADMINISTRATION.  The Plan shall be administered by the Company,
which, in its discretion and by action of the Board, may delegate its powers
with respect to the administration of the Plan to any person or entity.  Under
the Plan, the Company shall make purchases of Common Stock as agent for the
Participants.  If an Eligible Director or an Eligible Employee elects to
participate in the Plan, the Company will keep a continuous record of his
participation and send him a semi-annual statement of his account under the
Plan.  The Company will also hold and act as custodian of shares of Common
Stock purchased under the Plan.  This will relieve Participants of the
responsibility for the safekeeping of multiple certificates for shares
purchased and protect against loss, theft or destruction of stock
certificates.  Normally, certificates for shares of Common Stock purchased
under the Plan will not be issued to Participants.  The number of shares of
Common Stock credited to a Participant's account under the Plan will be shown
on his statement of account.  However, certificates for any number of whole
shares of Common Stock credited to a Participant's account under the Plan will
be issued to him upon his written request to the Company, delivered to the
Company's address. In addition, at the Company's option, any time that the
number of shares in a Participant's account exceeds 50, a certificate for 50
shares may be issued to him.  In either case, any remaining shares will
continue to be credited to the Participant's account.  Certificates for
fractional share interests will not be issued.

     The Company reserves the right to interpret and regulate the Plan.  The
Company may establish such procedures and make such other provisions for the
administration and operation of the Plan as it deems appropriate to give
effect to its purpose.

     4.   ELIGIBILITY.  As of November 30th of each calendar year, the Board
will designate each director and employee of the Company and its Subsidiaries
who will be an Eligible Director or Eligible Employee during the next
calendar year; provided, however, that no director shall vote with respect to
his own designation as an Eligible Director.  An "Eligible Employee" must, as
of such November 30 date, be age 18 or older and have completed at least one
year of service in the employment of the Company or a Subsidiary.  For this
purpose, one year of service shall mean 1,000 hours of employment.

     5.   ELECTION TO PARTICIPATE.  An Eligible Director or Eligible Employee
may become a Participant in the Plan during any calendar year in which he is
an Eligible Director or Eligible Employee by either of the two following
methods:  (1) an Eligible Employee will become a Participant during the payroll
period following receipt by the Company of a completed Authorization Card
approving payroll deductions or (2) an Eligible Director will become a
Participant following receipt by the Company of a completed Authorization Card
accompanying a lump-sum contribution; provided, however, that lump-sum
contributions received by the Company at least five business days before an
Investment Date will be invested on such Investment Date in accordance with
Section 6 below, and lump-sum contributions made within five days before an
Investment Date will be invested on the next following Investment Date in
accordance with Section 6.  An Eligible Director or Eligible Employee may join
the Plan at any time during any calendar year in which he is an Eligible
Director or Eligible Employee.

     6.   PAYROLL DEDUCTIONS AND LUMP-SUM CONTRIBUTIONS.  In order to
purchase Common Stock under the Plan by payroll deductions, an Eligible
Employee must complete an Authorization Card indicating the amount the Company
is to withhold each pay period from the Eligible Employee's paychecks during
the applicable calendar year and directing the Company to use such amounts to
purchase shares of Common Stock.  Deductions may be authorized in even
multiples of $5 from a minimum of $20 per month to a maximum of $20,000 in any
calendar year.

     After an Authorization Card has been received by the Company and the
authority for the payroll deductions has been noted on the Company's payroll
records, the Company will withhold from a Participant's paychecks the amount
authorized by the Participant.  The withholding will be made each pay period
from the paycheck for such period.  The amounts withheld from all
Participants' paychecks during each month, and any lump-sum contributions made
to the Plan within the time specified in Section 5 above, will be pooled and
used to buy shares of Common Stock for the accounts of all Participants under
the Plan on the Investment Date immediately following the date on which such
payments are made, or deemed made, to the Plan.

     The amount of a Participant's payroll deductions can be revised, changed
or terminated by the Participant at any time by written notice to the Company
and completion of a new Authorization Card.  Commencement, revision or
termination of payroll deductions will become effective as soon as
practicable after a Participant's new Authorization Card is received by the
Company. 

     An Eligible Director may purchase Common Stock under the Plan by making
a lump-sum payment to the Plan and completing an Authorization Card, not more
frequently than once each quarter during a calendar year that he is an
Eligible Director.  In no event may the aggregate amount of lump-sum
contributions made to the Plan by an Eligible Director exceed $20,000 in any
calendar year.

     Authorization Cards are effective until the earliest to occur of (1) the
date the Eligible Employee or Eligible Director elects to cease participation
in the Plan, (2) the date an individual ceases to be an Eligible Employee or
an Eligible Director, or (3) the date of the termination of the Plan.  No
interest will be paid on payroll deductions or lump-sum contributions made to
the Plan pending investment on an Investment Date.

     7.   PURCHASE PRICE.  The price of the shares bought with a Participant's
payroll deductions and/or lump-sum contributions will be the bid price for the
Common Stock, as reported in the Midwest Edition of the WALL STREET JOURNAL or
as reported by ABN AMRO CHICAGO CORPORATION in the event that the WALL STREET
JOURNAL does not list such price, in each case for the Investment Date on
which the shares are purchased (or, the next preceding day if no trading occurs
in the Common Stock on the Investment Date).

     8.   NUMBER OF SHARES PURCHASED.  On each Investment Date, accumulated
payroll deductions and lump-sum contributions from all Participants will be
pooled and used to purchase shares of Common Stock for the accounts of the
Participants.  The maximum number of whole shares shall be purchased with such
deductions and contributions.  The Company shall then contribute to the Plan
an amount sufficient to supplement the total of (1) any payroll deductions
and lump-sum contributions remaining after purchase of such maximum number of
whole shares in accordance with the preceding sentence, less (2) the value of
any fractional shares remaining in the suspense account described below from
the prior Investment Date, so that an additional whole share of Common Stock
can be purchased on such Investment Date.  Each Participant's account shall
be credited with his pro rata share (computed to four decimal places) of the
shares of Common Stock purchased on such Investment Date.  The number of
shares credited to each Participant's account will depend on the amount of
the Participant's payroll deductions and lump-sum contributions, as the case
may be, and price of the shares determined as provided under the heading
"Purchase Price."  Any fractional shares remaining after the purchase of Common
Stock for Plan to Participants shall be held in a suspense account for the
benefit of the Company and used to offset the number of shares of Common Stock
needed to fill purchases for Participants on the next Investment Date.

     9.   FEES AND EXPENSES.  Participants will incur no brokerage commissions
or service charges for purchases made under the Plan.  Certain charges as
described under the heading "Withdrawal" may be incurred upon a Participant's
withdrawal from the Plan or upon termination of the Plan.

     10.  WITHDRAWAL.  A Participant may withdraw from the Plan at any time. 
To withdraw from the Plan, a Participant must notify the Company in writing of
his withdrawal.  In the event a Participant withdraws, or in the event of the
termination of the Plan, within a reasonable time following the withdrawal
request or the termination of the Plan, certificates for whole shares credited
to the account of the withdrawing Participant, or all Participants in the
case of a termination of the Plan, will be delivered by the Company and a
cash payment will be made for the sale price (less brokerage commission and
transfer taxes, if any) of any fractional share interest and any additional
payroll deductions or lump-sum contributions credited to the account of the
withdrawing Participant, or all Participants in the case of a termination of
the Plan.  The Company may establish such equitable arrangements for the sale
of fractional share interests as it shall deem appropriate.  As an alternative
to receiving certificates for whole shares, a Participant may request the
Company to sell all of the shares held in his account under the Plan.  The
proceeds from the sale (less any brokerage commissions and any transfer taxes)
will be remitted to him as soon as reasonably practical after his withdrawal
request is received.  Sale requests may be accumulated and sales transactions,
if necessary, will occur at least every twenty-five business days.

     If a request to withdraw is received by the Company at least five
business days prior to any Investment Date, the amount of the Participant's
payroll deductions and/or lump-sum contributions which would otherwise have
been invested on such Investment Date will be repaid to him as soon as
practicable.  If a request to withdraw is received by the Company within five
business days prior to any Investment Date, the amount of the payroll
deductions and lump-sum contributions scheduled to be invested on such
Investment Date will be so invested.  In either event, no subsequent
payroll deductions will be made from the paychecks of the Participant,
and no lump sum contributions will be accepted from the Participant,
unless he completes a new Authorization Card providing for such deductions
or contributions.

     11.  TERMINATION OF EMPLOYMENT OR SERVICE AS A DIRECTOR.  A
Participant's participation in the Plan shall cease immediately upon his
termination of employment with the Company and its Subsidiaries for any reason,
or his termination of service on the Board or on the board of directors of
a Subsidiary for any reason.  Within 60 days of a Participant's termination
of employment or service, certificates for whole shares credited to his
account will be delivered to him by the Company and a cash payment will be
made to him for the sale price (less brokerage commission and transfer taxes,
if any) of any fractional share interest and any additional payroll deduction
or lump-sum contributions credited to his account.  In the event of the death
of a Participant prior to receipt of all payments and distributions to be made
to him under the Plan, payments and distributions shall be made to his
beneficiary last designated by written instrument delivered to the Company.  
If the Participant has not designated a beneficiary or if the designated
beneficiary is not living at such time, then such payments and distributions
shall be made to the Participant's spouse, or if none, to his lawful
descendants, per stirpes, or if none, to the legally appointed representative
of his estate. 

     12.   VOTING OF SHARES.  Each Participant will have the authority to
direct the Company in the manner of voting the number of shares held in his
account.  The shares of Common Stock in the suspense account created pursuant
to Section 8 shall be voted by the Company in its sole discretion.

     13.  CASH DIVIDENDS.  Cash dividends paid on shares of Common Stock
credited to a Participant's account will be paid to the Participant as soon
as practicable following the dividend payment date.  Dividend amounts payable
to Participants will be rounded to the nearest whole cent in the case of
fractional share interests.

     14.  STOCK DIVIDENDS, STOCK SPLITS, OR RIGHTS OFFERING.  Any shares
distributed by the Company as a stock dividend on shares of Common Stock
credited to a Participant's account under the Plan, or upon any split of such
shares, will be credited to his account.  In a rights offering, the Company
will sell the rights to which a Participant is entitled by virtue of the
shares of Common Stock allocated to his account under the Plan and the proceeds
will be credited to his account and applied to the purchase of shares on the
next Investment Date.

       15   AUTHORIZED SHARES.  The Company has reserved 40,000 shares of
Common Stock for issuance under the Plan.  Unless terminated earlier by the
Company, the Plan will terminate when all such shares have been purchased
by Participants.

     16.  AMENDMENT AND TERMINATION.  Although the Company intends to
continue the Plan as long as Common Stock reserved for issuance under it
remains, the Company reserves the right to suspend, modify or terminate the
Plan at any time.  Any such suspension, modification or termination shall not
affect a Participant's right to shares of Common Stock already purchased for
him (except that the Company may take any action necessary to comply with
applicable law).  Upon the termination of the Plan, the Company shall return
to Participants any accumulated payroll deductions and lump-sum contributions
that have not been used to purchase Common Stock as soon as practicable.  Any
Common Stock held in the suspense account created pursuant to Section 8
shall be distributed to the Company.

     17.  STATEMENTS.  Each Participant will receive a semi-annual statement
of his account, reflecting all activity in the account over such period. 
Participants will also receive communications sent to other stockholders,
including the Annual Report of the Company, and its Notice of Annual Meeting
and Proxy Statement.  Participants will receive information necessary for
reporting income, if any, realized by them under the Plan to the Internal
Revenue Service.

     18.  WITHHOLDING.  All taxes subject to withholding payable with respect
to the amount of each Participant's payroll deductions under the Plan will be
deducted from the Participant's salary and will not reduce the amounts to be
paid to the Company.


                              [H&H LETTERHEAD]
                                                                  EXHIBIT 5.1
                              August 31, 1998

SECURITIES AND EXCHANGE COMMISSION
FILING DESK -- STOP 1-4
JUDICIARY PLAZA
450 Fifth Street, N.W.
Washington, D.C. 20549-1004

      RE:  PRINCETON NATIONAL BANCORP, INC. -- REGISTRATION OF 20,000 
           SHARES OF COMMON STOCK, PAR VALUE $5.00 PER SHARE, ON FORM S-8

Ladies and Gentlemen:

      We have acted as counsel to Princeton National Bancorp, Inc., a
Delaware corporation (the "Company"), in connection with the Company's
filing of a Registration Statement on Form S-8 (the "Registration Statement")
covering 20,000 shares of Common Stock, $5.00 par value per share (the "Common
Stock"), to be issued pursuant to the Princeton National Bancorp, Inc.
Employee Stock Purchase Plan (the "Plan").

      In this connection, we have made such investigation and have examined
such documents as we have deemed necessary in order to enable us to render the
opinion contained herein.

      Based upon the foregoing, it is our opinion that those shares of Common
Stock covered by the Registration Statement that are originally issued in
accordance with the terms of the Plan and as contemplated in the Registration
Statement and the Prospectus relating thereto, will, when so issued, be
legally issued, fully paid and nonassessable.

      We hereby consent to the filing of this opinion as an exhibit to the
Registration Statement.

                                            VERY TRULY YOURS,

                                            HOWARD & HOWARD



                                      By: /s/ TIMOTHY E. KRAEPEL
                                         ____________________________________
                                         Timothy E. Kraepel


               [KPMG PEAT MARWICK LLP LETTERHEAD]

                                                             EXHIBIT 23.1



Board of Directors
Princeton National Bancorp, Inc.

We consent to incorporation by reference in the registration statement of
Form S-8 of Princeton National Bancorp, Inc. of our report dated January 30,
1998, relating to the consolidated balance sheets of Princeton National
Bancorp, Inc. and subsidiaries as of December 31, 1997 and 1996, and the
related consolidated statements of income, stockholders' equity, and cash
flows for each of the years in the three-year period ended December 31, 1997,
which report appears in the December 31, 1997 annual report on form 10-K of
Princeton National Bancorp, Inc.


                                   KPMG PEAT MARWICK LLP

Chicago, Illinois
August 28, 1998



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