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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 13D
Under the Securities Exchange Act of 1934
(Amendment No. ________)*
CARDINAL BANCSHARES, INC.
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(Name of Issuer)
COMMON STOCK, NO PAR VALUE
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(Title of Class of Securities)
141477109
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(CUSIP Number)
JAMES S. MAHAN, III
3390 PEACHTREE ROAD, NE, SUITE 1700,
ATLANTA, GEORGIA 30324
(404)812-6710
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(Name, Address and Telephone Number of
Person Authorized to Receive Notices and Communications)
March 21, 1997
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(Date of Event which Requires Filing of this Statement)
If the filing person has previously filed a statement on Schedule 13G to report
the acquisition which is the subject of this Schedule 13D, and is filing this
schedule because of Rule 13d-1(b)(3) or (4), check the following box _.
Check the following box if a fee is being paid with the statement. (A fee is
not required only if the reporting person: (1) has a previous statement on file
reporting beneficial ownership of more than five percent of the class of
securities described in Item 1; and (2) has filed no amendment subsequent
thereto reporting beneficial ownership of five percent or less of such class.)
(See Rule 13d-7.)
Note: Six copies of this statement, including all exhibits, should be filed
with the Commission. See Rule 13d-1(a) for other parties to whom copies are to
be sent.
* The remainder of this cover page shall be filled out for a reporting
person's initial filing on this form with respect to the subject class of
securities, and for any subsequent amendment containing information which would
alter disclosures provided in a prior cover page.
The information required on the remainder of this cover page shall not be
deemed to be "filed" for the purpose of Section 18 of the Securities Exchange
Act of 1934 ("Act") or otherwise subject to the liabilities of that section of
the Act but shall be subject to all other provisions of the Act (however, see
the Notes).
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SCHEDULE 13D
CUSIP NO. 141477109 PAGE 2 OF 5 PAGES
1 NAME OF REPORTING PERSON
JAMES S. MAHAN, III
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
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2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (A) [ ]
(B) [ ]
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3 SEC USE ONLY
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4 SOURCE OF FUNDS*
00
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5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS 2(D) OR 2(E) _
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6 CITIZENSHIP OR PLACE OF ORGANIZATION
UNITED STATES OF AMERICA
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7 SOLE VOTING POWER
118,434
NUMBER OF -----------------------------------------------------------------------------------------
SHARES
BENEFICIALLY 8 SHARED VOTING POWER
OWNED BY 0
EACH -----------------------------------------------------------------------------------------
REPORTING
PERSON 9 SOLE DISPOSITIVE POWER
WITH 118,434
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10 SHARED DISPOSITIVE POWER
118,434
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11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
118,434
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12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES _
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13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
7.13%
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14 TYPE OF REPORTING PERSON*
IN
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</TABLE>
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CUSIP No. 141477109 Page 3 of 5 Pages
ITEM 1. SECURITY AND ISSUER
This statement relates to the common stock, no par value per share (the
"Common Stock"), of Cardinal Bancshares, Inc., a Kentucky corporation (the
"Issuer"). The principal executive offices of the Issuer are located at 400
East Vine Street, Suite 300, Lexington, Kentucky.
ITEM 2. IDENTITY AND BACKGROUND
This statement is being filed by James S. Mahan, III (the "Reporting
Person"). The principal occupation of the Reporting Person is serving as Chief
Executive Officer of Security First Network Bank, Atlanta, Georgia ("SFNB"),
which is located at 3390 Peachtree Road, NE, Suite 1700, Atlanta, Georgia. The
Reporting Person is a citizen of the United States of America. Until May 23,
1996, SFNB was a wholly-owned subsidiary of the Issuer. Until September 20,
1996, the Reporting Person was a director and the Chief Executive Officer of the
Issuer.
The Reporting Person has not during the last five years been (i) convicted
in a criminal proceeding (excluding traffic violations or similar misdemeanors)
or (ii) a party to a civil proceeding of a judicial or administrative body of
competent jurisdiction and, as a result of such proceeding, was or is subject
to a judgment, decree or final order enjoining future violations of, or
prohibiting or mandating activities subject to, federal or state securities
laws or finding any violation with respect to such laws.
ITEM 3. SOURCE AND AMOUNT OF FUNDS OR OTHER CONSIDERATION
The shares of Common Stock owned by the Reporting Person were acquired
pursuant to separate transactions. Prior to March 21, 1997, the Reporting
Person beneficially owned 51,768 shares of Common Stock, or approximately 3.25%
of the Issuer's Common Stock based on the number of shares of Issuer Common
Stock outstanding on March 21, 1997. Based on the Issuer's audited net income
results for December 31, 1996 delivered to the Issuer on March 21, 1997 by its
independent accountants, the performance goals (as discussed below) relating to
the vesting of options to purchase 66,666 shares of Issuer Common Stock held by
the Reporting Person were met and such options vested and became exercisable as
of March 21, 1997 and are reported herein. Such options, with an exercise
price of $5.00 per share, were issued pursuant to the Issuer's 1992 Limited
Stock Option Plan, as amended (the "TARSOP"). Pursuant to the terms of the
TARSOP, the options were to vest if the Issuer achieved earnings per share, on
a fully diluted basis, of at least $3.36 per share for the fiscal year ended
December 31, 1996 (the "Performance Threshold"), provided that the Reporting
Person was employed by the Issuer on December 31, 1996. Pursuant to an
amendment to the TARSOP that was approved by the Issuer's shareholders on
October 18, 1996, (i) the Reporting Person's employment at SFNB is deemed to be
employment by the Issuer through December 31, 1996, and (ii) the method of
determining earnings per share for purposes of the Performance Threshold was
amended to exclude the effects of any charge arising as a result of (a) any
special assessment imposed by the Savings Association Insurance Fund ("SAIF")
or Federal Deposit Insurance Corporation after July 31, 1996, related to the
recapitalization of the SAIF or (b) certain amendments to the Issuer's stock
option plans. Such options have vested and will remain exercisable by the
Reporting Person until December 31, 2001.
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CUSIP No. 141477109 Page 4 of 5 Pages
ITEM 4. PURPOSE OF TRANSACTION
The options to purchase 66,666 shares of Common Stock were issued to the
Reporting Person pursuant to the Issuer's TARSOP, as discussed at Item 3.
The Reporting Person has acquired his shares of Common Stock for
investment. The Reporting Person may, from time to time, in the ordinary
course of his business, invest in additional shares of Common Stock or may,
depending upon market conditions and other factors deemed relevant, engage in a
sale or other disposition of all or a portion of the shares of Common Stock
being reported herein.
The Reporting Person has no present plans or proposals that relate to
or would result in an extraordinary corporate transaction involving the Issuer
or any of its subsidiaries, a sale or transfer of any of the Issuer's assets, a
change in the present Board of Directors or management of the Issuer, a change
in the present capitalization or dividend policy of the Issuer, or any other
material change in the Issuer's business or corporate structure, changes in the
Issuer's Articles of Incorporation or Bylaws or with respect to the delisting
or deregistration of any of the Issuer's securities.
ITEM 5. INTEREST IN SECURITIES OF THE ISSUER
The Reporting Person beneficially owns, in the aggregate, 118,434
shares of Common Stock of the Issuer, which represent approximately 7.13% of
the outstanding shares of Issued Common Stock as of March 21, 1997. Of such
amount, 49,998 of such shares are owned directly by the Reporting Person, 855
are held by an individual retirement account for the benefit of the Reporting
Person, 915 are held in the Issuer's 401(k) Plan and 66,666 of such shares are
issuable upon the exercise of options held by the Reporting Person which as
discussed above in Item 3 are exercisable by the Reporting Person.
Other than as reported in Item 3 above, the Reporting Person has not
engaged in any transactions in the Issuer's Common Stock within the past sixty
days. Except for such shared dispositive power, no person other than the
Reporting Person has the right to receive or the power to direct the receipt of
dividends from or the proceeds from the sale of the Common Stock beneficially
owned by the Reporting Person.
ITEM 6. CONTRACTS, ARRANGEMENTS, UNDERSTANDINGS OR RELATIONSHIPS
WITH RESPECT TO SECURITIES OF THE ISSUER
The Reporting Person has not entered into any contracts, arrangements,
understandings or relationships (legal or otherwise) among himself or with any
other person with respect to any securities of the Issuer.
Until September 20, 1996, the Reporting Person served as a director
and the Chief Executive Officer of the Issuer. This relationship was
terminated in connection with the regulatory approvals of the Issuer's spin-off
of its then wholly-owned subsidiary SFNB.
ITEM 7. MATERIAL TO BE FILED AS EXHIBITS
None.
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CUSIP No. 141477109 Page 5 of 5 Pages
Signature
After reasonable inquiry and to the best of my knowledge and belief, I
certify that the information set forth in the Schedule 13D is true, complete
and correct.
Dated: March 31, 1997
/s/ James S. Mahan, III
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James S. Mahan, III
