SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the Securities
Exchange Act of 1934
Filed by the Registrant |X|
Filed by the Party other than the Registrant |_|
Check the appropriate box:
|_| Preliminary Proxy Statement |_| Confidential, for Use of the Commission
Only (as permitted by Rule 14a-6(e)(2))
|X| Definitive Proxy Statement
|_| Definitive Additional Materials
|_| Soliciting Material Pursuant to Rule 14a-11(c) or Rule 14a-12
PINNACLE BANCSHARES, INC.
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(Name of Registrant as Specified in its Charter)
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(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
|X| No fee required.
|_| Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and 0-11.
1. Title of each class of securities to which transaction applies:
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2. Aggregate number of securities to which transaction applies:
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3. Per unit price or other underlying value of transaction
computed pursuant to Exchange Act Rule 0-11 (set forth the
amount on which the filing fee is calculated and state how it
was determined):
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4. Proposed maximum aggregate value of transaction:
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5. Total fee Paid:
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|_| Fee paid previously with preliminary materials:
|_| Check box if any part of the fee is offset as provided by Exchange Act Rule
0-11(a)(2) and identify the filing for which the offsetting fee was paid
previously. Identify the previous filing by registration statement number,
or the Form or Schedule and the date of its filing.
1. Amount previously paid:
_____________________________________
2. Form, Schedule or Registration Statement No.:
_____________________________________
3. Filing Party:
_____________________________________
4. Date Filed:
_____________________________________
PINNACLE BANCSHARES, INC.
1811 SECOND AVENUE
JASPER, ALABAMA 35501
(205) 221-4111
April 28, 2000
Dear Stockholder:
We invite you to attend the Annual Meeting of Stockholders (the "Annual
Meeting") of Pinnacle Bancshares, Inc. (the "Company") to be held at the CHS
Activity Center, 204 19th Street East, Jasper, Alabama on Wednesday, May 24,
2000 at 11:00 a.m., local time.
The attached Notice of Annual Meeting and Proxy Statement describe the
formal business to be transacted at the Annual Meeting.
As an integral part of the Annual Meeting, we will report on the operations
of the Company. Directors and officers of the Company will be present to respond
to any questions that our stockholders may have. Detailed information concerning
our activities and operating performance is contained in our Annual Report which
also is enclosed.
YOUR VOTE IS IMPORTANT, REGARDLESS OF THE NUMBER OF SHARES YOU OWN. On
behalf of the Board of Directors, we urge you to please sign, date and return
the enclosed proxy card in the enclosed postage-prepaid envelope as soon as
possible even if you currently plan to attend the Annual Meeting. This will not
prevent you from voting in person, but will assure that your vote is counted if
you are unable to attend the Annual Meeting.
Sincerely,
/s/ Al H. Simmons /s/ Robert B. Nolen, Jr.
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Al H. Simmons Robert B. Nolen, Jr.
Chairman of the Board President and Director
PINNACLE BANCSHARES, INC.
1811 SECOND AVENUE
JASPER, ALABAMA 35501
(205) 221-4111
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NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD ON MAY 24, 2000
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NOTICE IS HEREBY GIVEN that the Annual Meeting of Stockholders (the "Annual
Meeting") of Pinnacle Bancshares, Inc. (the "Company") will be held at the CHS
Activity Center, 204 19th Street East, Jasper, Alabama, on Wednesday, May 24,
2000 at 11:00 a.m., local time.
The Annual Meeting is for the following purposes, which are more completely
described in the accompanying Proxy Statement:
1. The election of three directors of the Company for a term of three
years.
2. Such other matters as may properly come before the Annual Meeting or
any adjournment thereof.
The Board of Directors is not aware of any other business to come before
the Annual Meeting.
Any action may be taken on any one of the foregoing proposals at the Annual
Meeting or any adjournments thereof. Stockholders of record at the close of
business on April 14, 2000, are the stockholders entitled to vote at the Annual
Meeting and any adjournment thereof.
You are requested to fill in and sign the enclosed proxy which is solicited
by the Board of Directors and to mail it promptly in the enclosed envelope. The
proxy will not be used if you attend and vote at the Annual Meeting in person.
BY ORDER OF THE BOARD OF DIRECTORS
/s/ THOMAS L. SHERER
THOMAS L. SHERER
SECRETARY
Jasper, Alabama
April 28, 2000
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IMPORTANT: THE PROMPT RETURN OF PROXIES WILL SAVE THE COMPANY THE EXPENSE OF A
FURTHER REQUEST FOR PROXIES IN ORDER TO INSURE A QUORUM. A SELF-ADDRESSED
ENVELOPE IS ENCLOSED FOR YOUR CONVENIENCE. NO POSTAGE IS REQUIRED IF MAILED
WITHIN THE UNITED STATES.
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PROXY STATEMENT
PINNACLE BANCSHARES, INC.
1811 SECOND AVENUE
JASPER, ALABAMA 35501
(205) 221-4111
ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD
MAY 24, 2000
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INTRODUCTION
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This Proxy Statement is furnished in connection with the solicitation of
proxies by the Board of Directors of Pinnacle Bancshares, Inc. (the "Company")
for the Annual Meeting of Stockholders (the "Annual Meeting") to be held at the
CHS Activity Center, 204 19th Street East, Jasper, Alabama on Wednesday, May 24,
2000, at 11:00 a.m., local time. The accompanying Notice of Annual Meeting and
this Proxy Statement, together with the enclosed form of proxy, are first being
mailed to stockholders on or about April 28, 2000.
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VOTING AND REVOCATION OF PROXIES
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Proxies solicited by the Board of Directors of the Company will be voted in
accordance with the directions given therein. WHERE NO INSTRUCTIONS ARE GIVEN,
PROPERLY EXECUTED PROXIES WHICH HAVE NOT BEEN REVOKED WILL BE VOTED FOR THE
NOMINEES FOR DIRECTORS SET FORTH BELOW. The proxy confers discretionary
authority on the persons named therein to vote with respect to the election of
any person as a director where the nominee is unable to serve or for good cause
will not serve, and with respect to matters incident to the conduct of the
Annual Meeting. If any other matters are properly brought before the Annual
Meeting as to which proxies in the accompanying form confer discretionary
authority, proxies will be voted by those named therein in accordance with the
determination of a majority of the Board of Directors. The proxies solicited on
behalf of the Board of Directors confer discretionary authority upon the holders
thereof with respect to matters incident to the conduct of the Annual Meeting
and with respect to any other matter presented to the Annual Meeting if notice
of such matter has not been delivered to the Company in accordance with the
Certificate of Incorporation. Proxies marked as abstentions will not be counted
as votes cast. In addition, shares held in street name which have been
designated by brokers on proxy cards as not voted ("broker no votes") will not
be counted as votes cast. Proxies marked as abstentions or as broker no votes,
however, will be treated as shares present for purposes of determining whether a
quorum is present.
Stockholders who execute the form of proxy enclosed herewith retain the
right to revoke such proxies at any time prior to exercise. Unless so revoked,
the shares represented by properly executed proxies will be voted at the Annual
Meeting and all adjournments thereof. Proxies may be revoked at any time prior
to exercise by written notice to the Secretary of the Company or by the filing
of a properly executed, later-dated proxy. A proxy will not be voted if a
stockholder attends the Annual Meeting and votes in person. The presence of a
stockholder at the Annual Meeting alone will not revoke such stockholder's
proxy.
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VOTING SECURITIES AND PRINCIPAL HOLDERS THEREOF
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The securities which can be voted at the Annual Meeting consist of shares
of the Company's common stock, par value $.01 per share ("Common Stock").
Stockholders of record as of the close of business on April 14, 2000 (the
"Record Date") are entitled to one vote for each share of Common Stock then held
on all matters. As of the Record Date, 1,792,086 shares of the Common Stock were
issued and outstanding. The presence, in person or by proxy, of at least
one-third of the total number of shares of Common Stock outstanding and entitled
to vote will be necessary to constitute a quorum at the Annual Meeting.
The following table sets forth, as of the Record Date, certain information
as to the persons believed by management to be the beneficial owners of more
than 5% of the outstanding shares of Common Stock and as to the shares of Common
Stock beneficially owned by all executive officers and directors of the Company
as a group. Persons and groups owning in excess of 5% of Common Stock are
required to file certain reports regarding such ownership with the Company and
the Securities and Exchange Commission ("SEC") pursuant to the Securities
Exchange Act of 1934, as amended (the "Exchange Act"). This information is based
on the most recent reports filed by such persons or information provided to the
Company by such persons.
Percent of Shares
Name and Address of Amount and Nature of of Common Stock
Beneficial Owners Beneficial Ownership(1) Outstanding
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All Executive Officers and 253,660 (2) 14.2%
Directors as a Group
(10 persons)
Jeffrey L. Gendell 176,000 (3) 9.9%
Tontine Partners, L.P.
31 West 52nd Street
New York, New York 10019
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(1) In accordance with Rule 13d-3 under the Exchange Act, a person is
considered to "beneficially own" any shares of Common Stock (a) over which
he has or shares voting or investment power, or (b) of which he has the
right to acquire beneficial ownership at any time within 60 days of the
Record Date. As used herein, "voting power" is the power to vote or direct
the vote of shares, and "investment power" is the power to dispose or
direct the disposition of shares. All data prior to October 29, 1997 has
been restated to reflect a two-for-one stock split effected in the form of
a stock dividend.
(2) Includes shares owned directly by directors and officers of the Company as
well as shares held by their spouses and minor children and trusts of which
certain directors are trustees, but does not include shares held or
beneficially owned by other relatives as to which they disclaim beneficial
ownership. Also includes shares of Common Stock underlying options granted
under the Pinnacle Bancshares, Inc. 1996 Stock Option and Incentive Plan
(the "Option Plan") which are exercisable within 60 days of the Record Date
and shares allocated to participants in the Pinnacle Bank 401(k) retirement
plan.
(3) Mr. Gendell serves as the Managing Member of Tontine Management, L.L.C.
which is the general partner of Tontine Partners, L.P., a Delaware limited
partnership ("Tontine"). Mr. Gendell reported sole voting and dispositive
power of 6,000 shares and shared voting and dispositive power with Tontine
of 170,000 shares as of January 7, 1997.
SECTION 16(A) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
Section 16(a) of the Exchange Act requires the Company's officers and
directors, and persons who own more than 10% of a registered class of the
Company's equity securities, to file reports of ownership and changes in
ownership with the SEC. Officers, directors and greater than 10% stockholders
are required to furnish the Company with copies of all such reports. Based
solely on its review of copies of such reports received by it, or written
representations from certain reporting persons that no annual report of change
in beneficial ownership is required, the Company believes that, during the year
ended December 31, 1999, all such filing requirements were complied with, except
that a report of the purchase of Common Stock was not filed on a timely basis by
each of Greg Batchelor and Max W. Perdue, but such reports were subsequently
filed.
2
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PROPOSAL I -- ELECTION OF DIRECTORS
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The Company's Certificate of Incorporation requires that directors be
divided into three classes, as nearly equal in number as possible, the members
of each class to serve for a term of three years and until their successors are
elected and qualified. The Board of Directors currently consists of nine
members. The Board of Directors has nominated James W. Cannon, Robert B. Nolen,
Jr. and Max W. Perdue to serve for three-year terms or until their successors
are elected and qualified. Delaware law provides that directors shall be elected
by a plurality of the votes of the shares present in person or represented by
proxy and entitled to vote on the election of directors.
It is intended that the persons named in the proxies solicited by the Board
of Directors will vote for the election of the named nominees. Stockholders are
not entitled to cumulate their votes for the election of directors. If any
nominee is unable to serve, the shares represented by all valid proxies will be
voted for the election of such substitute director as the Board of Directors may
recommend or the Board of Directors may reduce the number of directors to
eliminate the vacancy.
The following table sets forth for each nominee and for each director
continuing in office, including the named executive officer, such person's name,
age, the year he first became a director and the number of shares and percentage
of Common Stock beneficially owned.
3
THE BOARD OF DIRECTORS RECOMMENDS A VOTE "FOR" THE NOMINEES NAMED BELOW AS
DIRECTORS OF THE COMPANY.
PRESENT SHARES OF
YEAR FIRST TERM COMMON STOCK PERCENT
ELECTED TO BENEFICIALLY OF
NAME AGE(1) DIRECTOR (2) EXPIRE OWNED (3) CLASS
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BOARD NOMINEES FOR TERMS TO EXPIRE IN 2003
James W. Cannon 56 1990 2000 20,498 1.1%
Robert B. Nolen, Jr. 41 1994 2000 33,369 (4) 1.8%
Max W. Perdue 66 1991 2000 16,156 *
DIRECTORS CONTINUING IN OFFICE
Greg Batchelor 44 1983 2001 39,120 2.2%
Melvin R. Kacharos 73 1989 2001 11,300 *
J. T. Waggoner 62 1996 2001 5,450 *
O. H. Brown 55 1989 2002 11,200 *
Sam W. Murphy 52 1981 2002 26,055 1.5%
Al H. Simmons 52 1979 2002 86,512 4.8%
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* Less than 1% of shares outstanding.
(1) At December 31, 1999.
(2) Includes term of office as director of Pinnacle Bank (the "Bank") prior to
formation of the Company as the holding company for the Bank in January
1997. Each director of the Company is also a director of the Bank.
(3) At the Record Date. In accordance with Rule 13d-3 under the Exchange Act, a
person is considered to "beneficially own" any shares of Common Stock (a)
over which he has or shares voting or investment power, or (b) as to which
he has the right to acquire beneficial ownership at any time within 60 days
of the Record Date. As used herein, "voting power" is the power to vote or
direct the vote of shares, and "investment power" is the power to dispose
or direct the disposition of shares. Includes shares owned directly by the
named individuals as well as shares held by their spouses and minor
children and trusts of which certain of such persons are trustees, but does
not include shares held or beneficially owned by other relatives as to
which they disclaim beneficial ownership. Also includes shares of Common
Stock underlying options granted under the Option Plan which are
exercisable within 60 days of the Record Date. See "Voting Securities and
Principal Holders Thereof."
(4) Includes 11,701 shares allocated to Mr. Nolen's account in the Bank's
401(k) retirement plan.
4
Listed below is certain information about the principal occupations of the
Board nominees and the other directors of the Company. Unless otherwise noted,
all such persons have held these positions for at least five years.
JAMES W. CANNON is Senior Vice President - Operations of Burton Golf, Inc.,
a manufacturer of golf bags headquartered in Fort Walton Beach, Florida.
ROBERT B. NOLEN, JR. joined the Company in 1987 as First Vice President,
Chief Financial Officer and Treasurer. In 1990, Mr. Nolen was appointed
Executive Vice President of the Company, and in 1994, Mr. Nolen was appointed
President and Chief Executive Officer of the Company.
MAX W. PERDUE retired in 1991 as Jasper, Alabama District Manager of the
Alabama Power Company, having served with the company for thirty years in
various engineering and management positions. Mr. Perdue is past-president of
the Jasper Area Chamber of Commerce and resides in Jasper, Alabama.
GREG BATCHELOR has been President of Dependable True Value Hardware, Inc.
in Russellville, Alabama since 1992. Prior to that, he was Manager.
MELVIN R. KACHAROS was Executive Vice President of Vulcan Asphalt, Inc.,
Cordova, Alabama, from which position he retired in 1988. Mr. Kacharos is a
Lieutenant Colonel, Retired, of the U.S. Army Reserve and resides in Cordova,
Alabama.
JAMES. T. WAGGONER is Vice President, External Affairs, HealthSouth
Corporation, Birmingham, Alabama. He also serves as an Alabama State Senator.
O. H. BROWN, is a certified public accountant, presently with the
accounting firm of Warren, Averett, Kimbrough and Marino, LLC, Jasper, Alabama.
From 1976 to June 1991, Mr. Brown had his own accounting practice, also in
Jasper, Alabama.
SAM W. MURPHY is Chairman of the Board, Chief Executive Officer and Sales
Manager of Murphy Furniture Manufacturing Co., Inc., a furniture manufacturer
located in Jasper, Alabama.
AL H. SIMMONS joined the Company in 1973 and served as President of the
Company from 1979 until 1994. In October 1989, Mr. Simmons was elected Chairman
of the Board of Directors. Mr. Simmons is the son of Chairman of the Board
Emeritus A. R. Simmons. Mr. Simmons is an insurance agent with Pittman &
Associates, Inc., Birmingham, Alabama.
OTHER EXECUTIVE OFFICER
MARY JO GUNTER, age 46, is Vice President of the Company and Senior Vice
President -- Banking Services of the Bank. Ms. Gunter joined the Bank in 1974
and has served in various lending related positions within the Bank. She is
responsible for branch operations, personnel, loan servicing and other customer
service areas.
MEETINGS AND COMMITTEES OF THE BOARD OF DIRECTORS
The Board of Directors of the Company held eight meetings during the year
ended December 31, 1999. The members of the Company's Board of Directors are
also members of the Bank's Board of Directors, which held 12 meetings during the
year ended December 31, 1999. All incumbent directors attended 75% or more of
the total number of Board meetings held during the year ended December 31, 1999
and the total number of meetings held by committees on which such directors
served during such period.
The Board of Directors of the Company serves as a nominating committee for
selecting the management nominees for election as directors. While the Board of
Directors will consider nominees recommended by stockholders, it has not
actively solicited recommendations from stockholders for nominees, nor has it
established
5
any procedures for this purpose. The Board of Directors held one meeting in its
capacity as a nominating committee.
There are no standing committees of the Board of Directors of the Company.
The Board of Directors of the Bank carries out many of its duties through
committees.
The Executive Committee, currently composed of directors Perdue, Kacharos,
Murphy, Brown, Simmons and Nolen, meets when deemed necessary by the President
of the Bank to discuss and approve any business coming before the Board between
monthly Board meetings. During the year ended December 31, 1999, the Executive
Committee held no meetings.
The Audit Committee, composed of directors Kacharos, Murphy and Brown, is
responsible for the review and evaluation of the Bank's annual audit reports
with the Bank's independent auditors and reports all findings and
recommendations to the Board of Directors. The audit committee also directs the
activities of the Bank's internal auditor. During the year ended December 31,
1999, the Audit Committee held four meetings.
The Compensation Committee, currently composed of directors Perdue, Cannon
and Murphy, meets annually or at the direction of the Bank's President to review
and adjust employee salaries. During the year ended December 31, 1999, the
Compensation Committee held one meeting.
EXECUTIVE COMPENSATION
The following table sets forth the cash and noncash compensation for the
years ended December 31, 1999, 1998 and 1997, respectively, awarded to or earned
by the Chief Executive Officer. No other executive officer earned in excess of
$100,000 in salary and bonus.
SUMMARY COMPENSATION TABLE
Long-Term Compensation
---------------------------------------------
Annual Compensation Awards Payouts
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Restricted Securities All Other
Name and Other Annual Stock Underlying LTIP Compen-
Principal Position Year Salary Bonus Compensation(1) Award(s) Options Payouts sation(2)
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Robert B. Nolen, Jr. 1999 $109,933 $10,000 -- -- -- -- $3,144
President and Chief 1998 $114,935 $15,000 -- -- -- -- $2,772
Executive Officer of 1997 $102,500 $30,000 -- -- 20,000(3) -- $2,562
the Company and the
Bank
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(1) Executive officers of the Company receive indirect compensation in the form
of certain perquisites and other personal benefits. The amount of such
benefits in the fiscal year by the named executive officer did not exceed
10% of the executive's annual salary and bonus.
(2) Represents contributions under the Company's 401(k) plan.
(3) Represents options granted under the Option Plan.
DIRECTORS' COMPENSATION
The members of the Board of Directors of the Company currently do not
receive fees in their capacity as such.
Directors of the Bank currently each receive a monthly fee of $400, plus an
additional $600 for each Board meeting attended. In addition, directors receive
a fee of $300 for each Loan Committee attended and $200 for each other committee
meeting attended. Officers of the Bank do not receive fees for committee or
advisory board meetings attended.
6
YEAR END OPTION VALUES
To date, no options have been exercised under the Option Plan by the named
executive officer. No options were granted to the named executive officer in
1999. The following table sets forth information concerning the value of options
held by the named executive officer at December 31, 1999.
Number of Securities Value of Unexercised
Underlying Unexercised In-the-Money Options at
Options at Fiscal Year Ended Fiscal Year End (1)
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Exercisable/Unexercisable Exercisable/
Name (Number of Shares) Unexercisable
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Robert B. Nolen, Jr. 20,000/-- $--/$--
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(1) Difference between fair market value of underlying Common Stock at December
31, 1999 ($8.25 per share, based on the closing sales price) and the
exercise price ($8.8125 per share). Options are in-the-money if the fair
market value of the underlying securities exceeds the exercise price of the
option.
EMPLOYMENT AGREEMENT
On January 26, 2000, the Company and the Bank entered into an employment
agreement with Robert B. Nolen, Jr., which amends and restates Mr. Nolen's prior
employment agreement with the Bank. The agreement provides for Mr. Nolen to
serve as President and Chief Executive Officer of each of the Company and the
Bank for a term of three years from April 22, 1999 and receive a base salary of
$120,000 per annum, subject to annual adjustments; provided, however, that any
reduction of Mr. Nolen's salary shall be commensurate with a general reduction
in the salaries of the Bank's senior officers. The agreement provides for a
salary review by the Board of Directors not less often than annually, as well as
for an extension for an additional one-year period beyond then expiration date.
In the event of his voluntary termination of employment under the agreement, Mr.
Nolen has agreed that for a period of one year after the effective date of such
termination, he will not within Walker and Jefferson Counties, Alabama, compete
with the Company or the Bank or recruit or solicit for employment any current or
future employee of the Company or the Bank. In the event of a termination of Mr.
Nolen's employment without just cause (as defined in the agreement), Mr. Nolen
will be entitled to his salary for an additional 12-month period and continued
health, life, disability and other benefits. In the event (i) Mr. Nolen
voluntarily terminates his employment as a result of a constructive discharge
(e.g., a material reduction without reasonable cause in his base compensation or
a material diminution or reduction in his responsibilities or authority), (ii)
Mr. Nolen is terminated following a change in control (as defined in the
agreement), (iii) Mr. Nolen voluntarily terminates his employment within 24
months after a change in control and a constructive discharge, or (iv) Mr. Nolen
voluntarily terminates his employment after 24 months but within 36 months
following a change in control, Mr. Nolen shall be entitled to payments equal to
the amount of 2.99 times the average annual compensation to Mr. Nolen during the
five years immediately prior to the termination. Based on Mr. Nolen's annual
compensation as of December 31, 1999, if any of such provisions were to be
effective, it would result in a payment to Mr. Nolen of approximately $359,000.
In addition, if Mr. Nolen terminates his employment within 12 months following a
change in control, he will be entitled to receive his salary for an additional
12-month period and, if he terminates his employment after 12 months but within
24 months following a change in control, he will be entitled to receive such
salary for an additional 24-month period. The agreement also provides for the
inclusion of Mr. Nolen in any present or future employee benefit plans or
programs of the Company and the Bank for which executives are or will become
eligible, customary fringe benefits, vacation and sick leave.
7
CERTAIN TRANSACTIONS
The Bank makes available loans to directors, officers and other employees,
including mortgage loans for the purchase or refinancing of their residences. It
is the belief of management that these loans neither involve more than normal
risk of collectability nor present other unfavorable features. Such loans have
been made in the ordinary course of business on substantially the same terms,
including interest rates, collateral and repayment terms, as those prevailing
for comparable transactions with non-affiliated persons. Management believes
that all loans made by the Bank to directors, officers and other employees were
in compliance with federal regulations in effect at the time the loans were
made.
The Bank's former main office building is owned by the Bank and is situated
on land leased from entities associated with the Simmons family and of which
Chairman Emeritus A. R. Simmons is a partner or trustee. Under the terms of the
lease for this office, a monthly payment of $1,050 is made for the grounds and
36 parking spaces. The lease was renewed in December 1996 for five years with an
option to renew for three additional terms of five years. The Bank has been
granted a right of first refusal to purchase the land. The Jasper Mall Branch
building is also owned by the Bank and is situated on land leased from an entity
associated with the Simmons family. The lease for the land on which the Jasper
Mall Branch is located currently provides annual rental of $23,784 to the entity
associated with the Simmons family. The lease runs through 2017.
The Bank leases its Haleyville Branch Office facilities from Cecil
Batchelor, the father of director Greg Batchelor. The lease currently provides
for an annual rental of $30,242.
In 1986, the Bank entered into an employment agreement with Al H. Simmons.
The agreement, as subsequently amended, provided for Mr. Simmons to serve as
President and Chief Executive Officer of the Bank for a term of three years
ending in 1996 and receive a base salary of $109,080 per annum, subject to
annual adjustments. In May 1994, the Bank and Mr. Simmons entered into a
termination agreement whereby the parties agreed to terminate Mr. Simmons'
employment agreement and to provide for a lump sum payment to Mr. Simmons of
certain severance benefits in satisfaction of Mr. Simmons' rights under the
employment agreement. In connection therewith, Mr. Simmons agreed to resign as
President and Chief Executive Officer of the Bank effective July 1, 1994, and
the Bank agreed to pay to Mr. Simmons a benefit having a present value equal to
$362,447. Such benefit was paid in 60 payments of $7,000 per month that began in
July 1994.
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INDEPENDENT AUDITORS
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Arthur Andersen LLP served as the Company's independent auditors for the
year ended December 31, 1999. The Board of Directors has appointed Arthur
Andersen LLP to serve as the Company's independent auditors for the fiscal year
ending December 31, 2000. A representative of Arthur Andersen LLP is expected to
be present at the Annual Meeting to respond to appropriate questions and will
have the opportunity to make a statement if he so desires.
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OTHER MATTERS
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The Board of Directors is not aware of any business to come before the
Annual Meeting other than those matters described above in this Proxy Statement
and matters incident to the conduct of the Annual Meeting. Properly executed
proxies in the accompanying form that have not been revoked confer discretionary
authority on the persons named therein to vote at the direction of a majority of
the Board of Directors with respect to matters incident to the conduct of the
Annual Meeting and with respect to any other matter presented to the Annual
Meeting if notice of such matter has not been delivered to the Company in
accordance with the Certificate of Incorporation, which provides an advance
notice procedure for certain business to be brought before an annual meeting of
stockholders. Under the Certificate of Incorporation and SEC rules, if a
stockholder notifies the Company after April 24, 2000 of such stockholder's
intent to present a proposal at the Annual Meeting, the persons named in the
accompanying proxy may exercise such discretionary voting authority if the
proposal is raised at the Annual Meeting without any discussion of the matter in
this Proxy Statement.
8
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MISCELLANEOUS
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The cost of solicitation of proxies will be borne by the Company. The
Company will reimburse brokerage firms and other custodians, nominees and
fiduciaries for reasonable expenses incurred by them in sending proxy material
to the beneficial owners of Common Stock. In addition to solicitations by mail,
directors, officers and regular employees of the Company and the Bank may
solicit proxies personally, by telegraph or telephone without additional
compensation.
The Annual Report to Stockholders for the year ended December 31, 1999,
including financial statements, is being mailed to all stockholders of record as
of the close of business on the Record Date. Any stockholder who has not
received a copy of such Annual Report may obtain a copy by writing to the
Secretary of the Company. Such Annual Report is not to be treated as part of the
proxy solicitation material nor as having been incorporated herein by reference.
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STOCKHOLDER PROPOSALS
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In order to be eligible for inclusion in the proxy statement and proxy
relating to the 2001 annual meeting of stockholders of the Company, which will
be held on or about May 23, 2001, any stockholder proposal to take action at
such meeting must be received by the Secretary of the Company at 1811 Second
Avenue, P.O. Box 1388, Jasper, Alabama no later than December 29, 2000. With
respect to the 2001 annual meeting of stockholders of the Company, if notice of
a stockholder proposal, which the stockholder has not previously sought to
include in the Company's proxy statement, is not received by April 23, 2001,
management proxies will be allowed to use their discretionary authority to vote
on such proposal without any discussion of the matter in the proxy statement.
Nothing in this paragraph shall be deemed to require the Company to include in
its proxy statement and proxy relating to the 2001 annual meeting, or to
consider and vote upon at such meeting, any stockholder proposal which does not
meet all of the requirements established by the SEC or the Company's Certificate
of Incorporation or Bylaws in effect at the time such proposal is received.
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ANNUAL REPORT ON FORM 10-KSB
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A COPY OF THE COMPANY'S ANNUAL REPORT ON FORM 10-KSB FOR THE YEAR ENDED DECEMBER
31, 1999, AS FILED WITH THE SEC, WILL BE FURNISHED WITHOUT CHARGE TO
STOCKHOLDERS AS OF THE RECORD DATE UPON WRITTEN REQUEST TO MARIE GUTHRIE,
PINNACLE BANCSHARES, INC., P.O. BOX 1388, JASPER, ALABAMA 35502-1388.
BY ORDER OF THE BOARD OF DIRECTORS
/s/ THOMAS L. SHERER
THOMAS L. SHERER
SECRETARY
Jasper, Alabama
April 28, 2000
9
REVOCABLE PROXY
PINNACLE BANCSHARES, INC.
---------------------------
ANNUAL MEETING OF STOCKHOLDERS
MAY 24, 2000
---------------------------
The undersigned stockholder of Pinnacle Bancshares, Inc. (the "Company")
hereby appoints Melvin R. Kacharos and O.H. Brown, or either of them, with full
powers of substitution, as attorneys and proxies for the undersigned, to vote
all shares of Common Stock of the Company which the undersigned is entitled to
vote at the Annual Meeting of Stockholders, to be held at the CHS Activity
Center, 204 19th Street East, Jasper, Alabama on Wednesday, May 24, 2000 at
11:00 a.m., local time, and at any and all adjournments thereof, as indicated
below and as determined by a majority of the Board of Directors with respect to
such other matters as may come before the Annual Meeting and as to which this
proxy confers discretionary authority.
VOTE
FOR WITHHELD
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I. Election as directors of all nominees
listed below (except as marked to the
contrary).
[ ] [ ]
James W. Cannon
(Three-year term)
Robert B. Nolen, Jr.
(Three-year term)
Max W. Perdue
(Three-year term)
INSTRUCTION: TO WITHHOLD YOUR VOTE FOR
ANY NOMINEE(S), WRITE THAT NOMINEE'S
NAME ON THE LINE BELOW.
II. Such other matters as may properly come before the Annual Meeting or any
adjournment thereof.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE "FOR" EACH OF THE LISTED
PROPOSITIONS.
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THIS PROXY WILL BE VOTED AS DIRECTED, BUT IF NO INSTRUCTIONS ARE SPECIFIED, THIS
PROXY WILL BE VOTED FOR EACH OF THE PROPOSITIONS STATED. IF ANY OTHER BUSINESS
IS PRESENTED AT THE ANNUAL MEETING AS TO WHICH THIS PROXY CONFERS DISCRETIONARY
AUTHORITY, THIS PROXY WILL BE VOTED BY THOSE NAMED IN THIS PROXY AS DETERMINED
BY A MAJORITY OF THE BOARD OF DIRECTORS. AT THE PRESENT TIME, THE BOARD OF
DIRECTORS KNOWS OF NO OTHER BUSINESS TO BE PRESENTED AT THE ANNUAL MEETING.
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THIS PROXY IS SOLICITED BY THE BOARD OF DIRECTORS
Should the undersigned be present and elect to vote at the Annual Meeting
or at any adjournment thereof and after notification to the Secretary of the
Company at the Annual Meeting of the stockholder's decision to terminate this
proxy, then the power of said attorneys and proxies shall be deemed terminated
and of no further force and effect. The undersigned hereby revokes any and all
proxies heretofore given with respect to shares of Common Stock of the Company
which the undersigned is entitled to vote at the Annual Meeting.
The undersigned stockholder acknowledges receipt from the Company, prior to
the execution of this proxy, of Notice of the Annual Meeting, a Proxy Statement,
and the Annual Report to Stockholders.
Dated: , 2000
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PRINT NAME OF STOCKHOLDER PRINT NAME OF STOCKHOLDER
- -------------------------------------- ----------------------------------
SIGNATURE OF STOCKHOLDER SIGNATURE OF STOCKHOLDER
Please sign exactly as your name appears on the envelope in which this card was
mailed. When signing as attorney, executor, administrator, trustee or guardian,
please give your full title. If shares are held jointly, each holder should
sign.
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PLEASE COMPLETE, DATE, SIGN AND MAIL THIS PROXY PROMPTLY IN THE ENCLOSED
POSTAGE-PREPAID ENVELOPE.
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