þ | ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
o | TRANSITION REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
Tennessee | 62-1812853 | |
(State or other jurisdiction
of incorporation) |
(I.R.S. Employer
Identification No.) |
211 Commerce Street, Suite 300, Nashville, Tennessee | 37201 | |
(Address of principal executive offices) | (Zip Code) |
Title of Each Class | Name of Exchange on which Registered | |
Common Stock, par value $1.00 | Nasdaq Global Select Market |
Large Accelerated filer o | Accelerated filer þ | Non-accelerated filer o | Smaller reporting company o | |||
(Do not check if a smaller reporting company) |
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1. | Achievement of all major integration milestones on time, | ||
2. | Achievement of the financial synergies that were proposed at the time the Mid-America transaction was announced, | ||
3. | No degradation in service quality as measured by internal client surveys, and | ||
4. | Continued loan growth for the combined firm at rates exceeding those of the previous period. |
| Clients generally perceive that service levels at banks are declining. We believe this is largely attributable to merger-related integration issues resulting from consolidation in the bank and brokerage industries. Additionally, small business owners want a reliable point of contact that is knowledgeable about their business and the financial products and services that are important to the success of their business. Nashville is dominated by three large regional bank holding companies that are headquartered elsewhere, each of whom is experiencing declining market share trends over the last seven years; and | ||
| There is significant growth in the demand for convenient access to financial services, particularly through ATMs, telephone banking, remote deposit capture and Internet banking. We have developed best-in-class products and services in these areas, including free ATM usage and a comprehensive Internet banking suite of products. |
| Hire and retain highly experienced and qualified banking and financial professionals with successful track records and, for client contact personnel, established books of business with small businesses, real estate professionals and affluent households within the Nashville and Knoxville MSAs. On average, our senior client contact associates have in excess of 20 years experience in their local market. We have also achieved an annual associate retention rate of approximately 90 percent. We believe we will continue to experience success in attracting more market-best associates to our firm as well as retaining our highly experienced and successful group of associates. | ||
| Provide individualized attention with consistent, local decision-making authority. | ||
| Offer a full line of financial services to include traditional depository and credit products, as well as sophisticated investment, trust and insurance products and services. As of December 31, 2007, Pinnacle Nationals brokerage division, Pinnacle Asset Management, had accumulated approximately $878 million in brokerage assets. In 2007, Pinnacle Asset Management was |
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the top producer among Raymond James Financial Services branches nationwide. Additionally, our trust department had accumulated approximately $464 million in trust assets under management at December 31, 2007. We will use our trust area, Pinnacle Asset Management and Miller and Loughry Insurance Services to provide a broad array of sophisticated and convenient investment and insurance products and services. |
| Capitalize on customer dissatisfaction that we believe exists and has been caused by what we believe to be our competitors less than satisfactory response to the financial needs of todays sophisticated consumers and small- to medium-sized businesses. Since we began our company, we have historically surveyed our customers on numerous matters related to their relationship with us. Consistently, 100 percent of these surveys indicate that Pinnacle is recognizably better than our competitors. | ||
| Offer extraordinary convenience by building a distribution system with online banking, telephone banking, remote deposit services and access to ATMs across the globe to provide options for clients to access financial services 24/7. In addition to the office expansion through acquisition, we opened two new offices in 2007, one in the Nashville MSA and the other in Knoxville. |
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|
Mutual Funds; | | Fixed Annuities; | |||||
|
Variable Annuities; | | Stocks; | |||||
|
Money Market Instruments; | | Financial Planning; | |||||
|
Treasury Securities; | | Asset Management Accounts; and | |||||
|
Bonds; | | Listed Options. |
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| Acquiring direct or indirect ownership or control of any voting shares of any bank if, after the acquisition, the bank holding company will directly or indirectly own or control more than 5% of the banks voting shares; | ||
| Acquiring all or substantially all of the assets of any bank; or | ||
| Merging or consolidating with any other bank holding company. |
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| The bank holding company has registered securities under Section 12 of the Securities Exchange Act of 1934; or | ||
| No other person owns a greater percentage of that class of voting securities immediately after the transaction. |
| Financial in nature; | ||
| Incidental to a financial activity; or | ||
| Complementary to a financial activity and do not pose a substantial risk to the safety or soundness of depository institutions or the financial system generally. |
| Lending, trust and other banking activities; | ||
| Insuring, guaranteeing, or indemnifying against loss or harm, or providing and issuing annuities, and acting as principal, agent, or broker for these purposes, in any state; | ||
| Providing financial, investment, or advisory services; | ||
| Issuing or selling instruments representing interests in pools of assets permissible for a bank to hold directly; | ||
| Underwriting, dealing in or making a market in securities; | ||
| Activities that the Federal Reserve has determined to be so closely related to banking or managing or controlling banks as to be a proper incident to banking or managing or controlling banks; |
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| Activities permitted outside of the United States that the Federal Reserve has determined to be usual in connection with banking or other financial operations abroad; | ||
| Merchant banking through securities or insurance affiliates; and | ||
| Insurance company portfolio investments. |
| Factoring accounts receivable; | ||
| Acquiring or servicing loans; | ||
| Leasing personal property; | ||
| Conducting discount securities brokerage activities; | ||
| Performing selected data processing services; | ||
| Acting as agent or broker in selling credit life insurance and other types of insurance in connection with credit transactions; and | ||
| Performing selected insurance underwriting activities. |
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| A banks loans or extensions of credit to affiliates; | ||
| A banks investment in affiliates; | ||
| Assets a bank may purchase from affiliates, except for real and personal property exempted by the Federal Reserve; | ||
| The amount of loans or extensions of credit to third parties collateralized by the securities or obligations of affiliates; and | ||
| A banks guarantee, acceptance or letter of credit issued on behalf of an affiliate. |
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| Federal Truth-In-Lending Act, governing disclosures of credit terms to consumer borrowers; | ||
| Home Mortgage Disclosure Act of 1975, requiring financial institutions to provide information to enable the public and public officials to determine whether a financial institution is fulfilling its obligation to help meet the housing needs of the community it serves; | ||
| Equal Credit Opportunity Act, prohibiting discrimination on the basis of race, creed or other prohibited factors in extending credit; | ||
| Fair Credit Reporting Act of 1978, governing the use and provision of information to credit reporting agencies; | ||
| Fair Debt Collection Act, governing the manner in which consumer debts may be collected by collection agencies; | ||
| Bank Secrecy Act, governing how banks and other firms report certain currency transactions and maintain appropriate safeguards against money laundering activities; | ||
| Soldiers and Sailors Civil Relief Act of 1940, governing the repayment terms of, and property rights underlying, secured obligations of persons in military service; and | ||
| Rules and regulations of the various federal agencies charged with the responsibility of implementing the federal laws. |
| Right to Financial Privacy Act, which imposes a duty to maintain confidentiality of consumer financial records and prescribes procedures for complying with administrative subpoenas of financial records; and | ||
| Electronic Funds Transfer Act and Regulation E issued by the Federal Reserve to implement that act, which govern automatic deposits to and withdrawals from deposit accounts and customers rights and liabilities arising from the use of automated teller machines and other electronic banking services. |
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| the loss of key employees and customers; | ||
| the disruption of operations and business; | ||
| inability to maintain and increase competitive presence; | ||
| loan and deposit attrition, customer loss and revenue loss; | ||
| possible inconsistencies in standards, control procedures and policies | ||
| unexpected problems with costs, operations, personnel, technology and credit; and/or | ||
| problems with the assimilation of new operations, sites or personnel, which could divert resources from regular banking operations. |
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(a) | A special meeting of Pinnacle Financials shareholders was held on November 27, 2007 to vote on the merger agreement with Mid-America Bancshares, Inc. and to amend the 2004 Equity Incentive Plan. There were 15,553,036 shares outstanding as of October 9, 2007 (the record date for the meeting) of which 10,977,776 shares were represented at the meeting on November 27, 2007. | ||
(c) | Matters voted upon and the results of the voting were as follows: |
| A proposal to approve the Agreement and Plan of Merger, dated as of August 15, 2007 by and between the Pinnacle Financial and Mid-America (Proposal #1); and | ||
| A proposal to approve the adjournment of the Special Meeting, if necessary, to permit the Pinnacle Financial to solicit additional proxies if there were not sufficient votes at the Special Meeting to constitute a quorum or to approve Proposal #1 (Proposal #2); and | ||
| A proposal to approve an amendment to Pinnacles 2004 Equity Incentive Plan to increase the number of shares of Pinnacle common stock reserved for issuance under the plan by 500,000 shares (Proposal #3). |
Proposal #1:
|
Number of votes cast For | 10,937,736 | ||||
|
Number of votes cast Against | 22,891 | ||||
|
Number of abstentions | 17,149 | ||||
|
||||||
Proposal #2:
|
Number of votes cast For | 10,738,068 | ||||
|
Number of votes cast Against | 202,398 | ||||
|
Number of abstentions | 36,310 | ||||
|
||||||
Proposal #3:
|
Number of votes cast For | 8,805,508 | ||||
|
Number of votes cast Against | 2,117,912 | ||||
|
Number of abstentions | 54,356 |
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Page 100
Price Per Share
High
Low
$
33.85
$
29.40
31.48
28.27
31.31
21.62
30.93
24.85
$
28.84
$
24.75
30.92
27.09
37.41
28.93
36.17
31.23
Table of Contents
2007
(1)
2006
(2)
2005
2004
2003
(in thousands, except per share data, ratios and percentages)
$
3,794,170
$
2,142,187
$
1,016,772
$
727,139
$
498,421
2,749,641
1,497,735
648,024
472,362
297,004
(28,470
)
(16,118
)
(7,858
)
(5,650
)
(3,719
)
522,685
346,494
279,080
208,170
139,944
260,900
125,673
3,081,390
1,763,427
875,985
602,655
405,619
141,666
53,726
41,500
53,500
44,500
82,476
51,548
30,929
10,310
10,310
466,610
256,017
63,436
57,880
34,336
$
150,931
$
109,696
$
46,308
$
27,679
$
18,262
75,219
48,743
17,270
7,415
5,363
75,712
60,953
29,038
20,264
12,899
4,720
3,732
2,152
2,948
1,157
70,992
57,221
26,886
17,316
11,742
22,521
15,786
5,394
4,978
3,035
60,480
46,624
21,032
14,803
10,796
33,033
26,383
11,248
7,491
3,981
9,992
8,456
3,193
2,172
1,426
$
23,041
$
17,927
$
8,055
$
5,319
$
2,555
$
1.43
$
1.28
$
0.96
$
0.69
$
0.35
16,100,076
13,954,077
8,408,663
7,750,943
7,384,106
$
1.34
$
1.18
$
0.85
$
0.61
$
0.32
17,255,543
15,156,837
9,464,500
8,698,139
7,876,006
$
20.96
$
16.57
$
7.53
$
6.90
$
4.65
22,264,817
15,446,074
8,426,551
8,389,232
7,384,106
0.96
%
1.01
%
0.93
%
0.89
%
0.66
%
8.34
%
8.66
%
13.23
%
12.31
%
7.70
%
3.55
%
3.90
%
3.60
%
3.62
%
3.53
%
2.88
%
3.20
%
3.16
%
3.34
%
3.23
%
0.94
%
0.89
%
0.62
%
0.83
%
0.78
%
2.53
%
2.61
%
2.42
%
2.48
%
2.78
%
61.57
%
60.76
%
61.08
%
58.64
%
67.78
%
94.88
%
88.73
%
81.3
%
79.0
%
85.5
%
119.46
%
122.10
%
120.0
%
120.0
%
118.9
%
11.56
%
11.64
%
7.00
%
7.23
%
8.54
%
133.3
%
199.9
%
1,708.3
%
1,006.9
%
981.3
%
1.04
%
1.08
%
1.21
%
1.20
%
1.25
%
0.56
%
0.37
%
0.05
%
0.08
%
0.08
%
0.72
%
0.47
%
0.07
%
0.12
%
0.13
%
0.06
%
0.05
%
(0.01
)%
0.27
%
0.05
%
11.6
%
9.5
%
9.9
%
9.7
%
9.7
%
9.5
%
10.9
%
11.7
%
11.7
%
11.8
%
10.4
%
11.8
%
12.6
%
12.7
%
12.8
%
(1)
Information for 2007 fiscal year includes the operations of Mid-America, which Pinnacle
Financial merged with on November 30, 2007 and reflects approximately 6.7 million shares of
Pinnacle Financial common stock issued in connection with the merger.
(2)
Information for 2006 fiscal year includes the operations of Cavalry, which Pinnacle Financial
merged with on March 15, 2006 and reflects approximately 6.9 million shares of Pinnacle
Financial common stock issued in connection with the merger.
(3)
Net interest margin is the result of net interest income for the period divided by average
interest earning assets.
(4)
Net interest spread is the result of the difference between the interest yield earned on
interest earning assets less the interest paid on interest bearing liabilities.
Table of Contents
(5)
Efficiency ratio is the result of noninterest expense divided by the sum of net interest
income and noninterest income.
(6)
Leverage ratio is computed by dividing Tier 1 capital by average total assets for the fourth
quarter of each year.
Table of Contents
$
60,795
147,766
855,887
129,334
8,085
49,854
1,251,721
957,076
61,383
27,107
1,045,566
$
206,155
Table of Contents
$
37,420
39,476
545,598
114,288
13,168
42,937
792,887
Table of Contents
583,992
17,767
18,851
620,610
$
172,277
Table of Contents
Table of Contents
Table of Contents
Table of Contents
Years ended
2007-2006
Year ended
2006-2005
December 31,
Percent
December 31,
Percent
2007
2006
Increase
(Decrease)
2005
Increase
(Decrease)
$
150,931
$
109,696
37.6
%
$
46,308
136.9
%
75,219
48,743
54.3
%
17,270
182.2
%
75,712
60,953
24.2
%
29,038
109.9
%
4,720
3,732
26.5
%
2,152
73.4
%
70,992
57,221
24.1
%
26,886
112.8
%
22,521
15,786
42.7
%
5,394
192.7
%
60,480
46,624
29.7
%
21,032
121.7
%
33,033
26,383
25.2
%
11,248
134.6
%
9,992
8,456
18.2
%
3,193
164.8
%
$
23,041
$
17,927
28.5
%
$
8,055
122.6
%
Year ended
Year ended
Year ended
December 31,
December 31,
December 31,
2007
2006
2005
$
23,041
$
17,927
$
8,055
378
994
$
23,419
$
18,921
$
8,055
$
1.34
$
1.18
$
0.85
$
1.36
$
1.25
$
0.85
Table of Contents
2007
2006
2005
Average Balances
Interest
Rates/ Yields
Average Balances
Interest
Rates/ Yields
Average Balances
Interest
Rates/ Yields
$
1,723,361
$
129,889
7.54
%
$
1,226,803
$
92,006
7.50
%
$
562,061
$
35,167
6.26
%
280,668
13,962
4.97
%
254,906
12,615
4.95
%
204,532
9,086
4.44
%
82,001
3,066
4.93
%
54,270
2,016
4.90
%
31,578
1,116
4.66
%
72,344
4,014
5.57
%
53,562
3,059
6.87
%
24,541
939
3.90
%
2,158,374
150,931
7.04
%
1,589,541
109,696
6.95
%
822,712
46,308
5.68
%
135,893
100,107
93,782
89,568
47,322
$
2,388,049
$
1,779,216
$
870,034
$
261,163
$
8,309
3.18
%
$
171,637
$
4,074
2.37
%
$
65,119
$
659
1.01
%
535,468
17,618
3.29
%
435,082
13,532
3.11
%
250,136
4,860
1.94
%
727,724
35,745
4.91
%
516,394
22,426
4.34
%
256,056
8,171
3.19
%
1,524,355
61,672
4.05
%
1,123,113
40,032
3.56
%
571,311
13,690
2.40
%
181,621
7,371
4.06
%
101,144
4,329
4.28
%
54,811
1,315
2.40
%
44,072
2,211
5.02
%
39,728
1,878
4.68
%
43,933
1,279
2.91
%
56,759
3,965
6.98
%
37,372
2,504
6.70
%
16,361
986
6.02
%
1,806,807
75,219
4.16
%
1,301,357
48,743
3.75
%
686,416
17,270
2.52
%
291,983
259,585
120,007
2,098,790
75,219
3.58
%
1,560,942
48,743
3.12
%
806,423
17,270
2.14
%
13,108
11,105
2,730
276,151
207,169
60,881
$
2,388,049
$
1,779,216
$
870,034
$
75,712
$
60,953
$
29,038
2.88
%
3.20
%
3.16
%
3.55
%
3.90
%
3.60
%
(1)
Average balances of nonperforming loans are included in the above amounts.
(2)
Yields based on the carrying value of those tax exempt instruments are shown on a fully tax
equivalent basis.
Table of Contents
(3)
The net interest spread calculation excludes the impact of demand deposits. Had the impact
of demand deposits been included, the net interest spread for the year ended December 31,
2007 would have been 3.46% compared to a net interest spread for the years ended December 31,
2006 and 2005 of 3.83% and 3.54%, respectively.
Our loan yields increased by only 4 basis points between 2007 and 2006 while they
increased by 124 basis points between 2006 and 2005. A significant amount of our loan
portfolio has variable rate pricing with a large portion of these loans tied to our prime
lending rate. Our weighted average prime rate for 2005 was 6.25% compared to 7.94% in 2006
and 7.52% in 2007. Our prime lending rate moves in concert with the Federal Reserves
changes to its Federal funds rate. As a result, the large increase in our prime rate
between 2005 and 2006 contributed to the increase in overall loan rates while the decrease
in our weighted average prime rate between 2006 and 2007 also impacted our loan rates.
Other factors that impact our loan yields in any period are our evaluation of the credit
worthiness, collateral and other factors related to the borrower when we agree to make a
loan, the term of the loan and the ongoing relationship we have with a particular borrower.
We have been able to grow our funding base significantly. For asset/liability
management purposes, we elected to allocate a greater proportion of such funds to our loan
portfolio versus our securities and shorter-term investment portfolio during the three year
period noted above. For 2007, average loan balances were 80% of total interest-earning
assets compared to 77% in 2006 and 68% in 2005. Loans generally have higher yields than do
securities and other shorter-term investments. This change in allocation contributed to
the increase in the overall total interest earning asset yields between the three years.
During 2007, overall deposit rates were higher than those rates for the comparable
period in 2006 and 2005. Normally, changes in interest rates paid on such products as
interest checking, savings and money market accounts, securities sold under agreements to
repurchase and Federal funds purchased will generally increase or decrease in a manner that
is consistent with changes in the short-term rate environment. However, during 2007, our
short term funding rates were generally higher than in 2006 even though we experienced
decreases in our short-term asset and prime rate loan yields. We continue to monitor the
pricing of deposit products by our primary competitors. The pricing of our primary
competitors required us to increase these rates during the three-year period noted.
During 2007, the average balances of noninterest bearing deposit balances, interest
bearing transaction accounts, savings and money market accounts and securities sold under
agreements to repurchase amounted to 61% of our total funding compared to 62% in 2005 and
61% in 2004. These funding sources generally have lower rates than do other funding
sources, such as certificates of deposit and other borrowings. Additionally, noninterest
bearing deposits comprised only 14% of total funding in 2007, compared to 17% in 2006 and
15% in 2005. Maintaining our noninterest bearing deposit balances in relation to total
funding is critical to maintaining and growing our net interest margin. Management places
a great deal of emphasis on this particular product.
Also impacting the net interest margin during 2007 compared to 2006 and 2005 was pricing
of our floating rate subordinated indebtedness which comprises approximately $60 million of
our average aggregate subordinated indebtedness as of December 31, 2007, compared to $30
million at December 31, 2006. The interest rate charged on this indebtedness is generally
higher than other funding sources. In October 2007, we issued an additional $30 million in
floating rate subordinated indebtedness to fund the cash component of the Mid-America
purchase price. The rate we are required to pay on this indebtedness is 285 points over
three-month LIBOR. This spread is higher than similar forms of subordinated indebtedness
which were acquired in previous periods reflecting an increase in market pricing for this
form of indebtedness which occurred in the last half of 2007.
Table of Contents
2007 Compared to 2006
2006 Compared to
2005
Increase (decrease) due to
Increase
(decrease) due to
Rate
Volume
Net
Rate
Volume
Net
$
491
$
37,392
$
37,883
$
6,970
$
49,869
$
56,839
51
1,296
1,347
1,043
2,486
3,529
16
1,034
1,050
76
824
900
(696
)
1,651
955
729
1,391
2,120
(138
)
41,373
41,235
8,818
54,570
63,388
1,390
2,845
4,235
886
2,529
3,415
783
3,303
4,086
2,927
5,745
8,672
2,943
10,376
13,319
2,945
11,310
14,255
5,116
16,524
21,640
6,758
19,584
26,342
(223
)
3,265
3,042
1,031
1,983
3,014
135
198
333
798
(199
)
599
105
1,356
1,461
111
1,407
1,518
5,134
21,342
26,476
8,698
22,775
31,473
$
(5,272
)
$
20,031
$
14,759
$
120
$
31,795
$
31,915
Table of Contents
2007-2006
2006-2005
Years ended
Percent
Year ended
Percent
December 31,
Increase
December 31,
Increase
2007
2006
(Decrease)
2005
(Decrease)
$
7,941
$
4,645
71.0
%
$
978
374.9
%
3,456
2,463
40.3
%
1,836
34.2
%
2,487
2,123
17.1
%
1,619
1,448
11.8
%
1,096
32.1
%
239
420
(43.1
%)
152
176.3
%
16
114
(100.0
%)
1,908
1,181
61.6
%
2,822
1,796
57.1
%
90
1895.6
%
293
506
(42.1
%)
527
(4.0
%)
631
470
34.3
%
74
535.1
%
274
120
128.3
%
216
(44.4
%)
835
614
36.0
%
311
97.4
%
$
22,521
$
15,786
42.7
%
$
5,394
192.7
%
Table of Contents
Table of Contents
2007-2006
2006-2005
Years ended
Percent
Year ended
Percent
December 31,
Increase
December 31,
Increase
2007
2006
(Decrease)
2005
(Decrease)
$
26,304
$
18,017
46.0
%
$
8,592
109.7
%
1,778
1,298
37.0
%
714
81.8
%
2,602
4,209
(38.2
%)
2,101
100.3
%
2,100
1,475
42.4
%
245
502.0
%
3,362
2,470
36.1
%
1,479
67.0
%
36,146
27,469
31.6
%
13,131
109.2
%
10,261
7,522
36.4
%
3,767
99.7
%
160
1,677
1,234
35.9
%
698
76.8
%
1,995
1,510
32.1
%
618
144.3
%
2,144
1,783
20.2
%
1,263
742
70.2
%
646
14.9
%
269
320
(15.9
%)
123
160.2
%
437
310
41.0
%
245
26.5
%
365
257
42.0
%
182
41.2
%
233
257
(9.3
%)
229
12.2
%
1,278
687
86.0
%
322
113.4
%
334
186
79.6
%
113
64.6
%
158
73
116.4
%
4
1,725.0
%
3,138
2,632
19.2
%
954
175.9
%
7,475
5,470
36.7
%
2,818
94.1
%
622
1,636
(62.0
%)
$
60,480
$
46,624
29.7
%
$
21,032
121.7
%
Table of Contents
Table of Contents
2007
2006
2005
2004
2003
Amount
Percent
Amount
Percent
Amount
Percent
Amount
Percent
Amount
Percent
$
728,201
26.5
%
$
284,302
19.0
%
$
148,102
22.9
%
$
117,123
24.8
%
$
68,507
23.1
%
562,721
20.5
%
299,627
20.0
%
169,953
26.2
%
126,907
26.9
%
76,042
25.6
%
517,399
18.8
%
253,097
16.9
%
67,667
10.5
%
23,419
5.0
%
11,288
3.8
%
838,161
30.5
%
608,530
40.6
%
239,129
36.9
%
189,456
40.1
%
129,882
43.7
%
103,159
3.7
%
52,179
3.5
%
23,173
3.6
%
15,457
3.3
%
11,285
3.8
%
$
2,749,641
100.0
%
$
1,497,735
100.0
%
$
648,024
100.0
%
$
472,362
100.0
%
$
297,004
100.0
%
Table of Contents
Amounts at December 31, 2007
Fixed
Variable
At December 31,
At December 31,
Rates
Rates
Totals
2007
2006
$
267,227
$
956,620
$
1,223,847
44.5
%
40.9
%
836,154
266,926
1,097,079
39.9
%
39.9
%
142,701
286,014
428,715
15.6
%
19.2
%
$
1,246,082
$
1,503,559
$
2,749,641
100.0
%
100.0
%
$
$
1,099,215
$
1,099,215
40.0
%
46.1
%
267,227
316,208
583,435
21.2
%
13.6
%
836,154
55,810
891,963
32.4
%
34.2
%
142,701
32,327
175,028
6.4
%
6.1
%
$
1,246,802
$
1,503,559
$
2,749,641
100.0
%
100.0
%
Table of Contents
At December 31,
2007
2006
2005
2004
2003
$
19,677
$
7,070
$
460
$
561
$
379
1,673
995
21,350
8,065
460
561
379
1,613
737
146
182
$
22,963
$
8,802
$
460
$
707
$
561
$
2,749,641
$
1,497,735
$
648,024
$
472,362
$
297,004
0.84
%
0.59
%
0.07
%
0.15
%
0.19
%
80.66
%
54.61
%
5.85
%
12.51
%
15.08
%
(1)
Interest income that would have been recorded in 2007 related to nonaccrual loans was
$485,000 compared to $283,000 for the year ended December 31, 2006 and $21,000 for the year
ended December 31, 2005, none of which is included in interest income or net income for the
applicable periods.
2007
2006
2005
2004
2003
Amount
Percent
Amount
Percent
Amount
Percent
Amount
Percent
Amount
Percent
$
8,068
26.4
%
$
4,550
19.0
%
$
1,488
22.9
%
$
1,205
24.8
%
$
723
23.1
%
1,890
20.8
%
913
20.0
%
1,286
26.2
%
869
26.9
%
607
25.6
%
4,897
18.7
%
2,869
16.9
%
690
10.5
%
227
5.0
%
113
3.8
%
11,660
30.4
%
6,517
40.6
%
2,305
36.9
%
1,711
40.1
%
1,236
43.7
%
1,400
3.7
%
870
3.5
%
552
3.6
%
396
3.3
%
320
3.8
%
555
NA
399
NA
1,537
NA
1,242
NA
720
NA
$
28,470
100.0
%
$
16,118
100.0
%
$
7,858
100.0
%
$
5,650
100.0
%
$
3,719
100.0
%
Table of Contents
For the year ended December 31,
2007
2006
2005
2004
2003
$
16,118
$
7,858
$
5,650
$
3,719
$
2,677
4,720
3,732
2,152
2,948
1,157
8,695
5,102
(22
)
(364
)
(46
)
(38
)
(834
)
(123
)
(271
)
(326
)
(436
)
(61
)
(50
)
(359
)
(336
)
(109
)
(148
)
(44
)
(1,342
)
(818
)
(208
)
(1,032
)
(167
)
125
231
1
2
49
51
166
3
102
78
30
13
3
279
244
264
15
52
(1,063
)
(574
)
56
(1,017
)
(115
)
$
28,470
$
16,118
$
7,858
$
5,650
$
3,719
1.04
%
1.08
%
1.21
%
1.20
%
1.25
%
0.06
%
0.05
%
(0.01
)%
0.27
%
0.05
%
Table of Contents
At December 31,
U.S. Treasury
U.S. government
State and Municipal
securities
agency securities
securities
Corporate securities
Totals
Amount
Yield
Amount
Yield
Amount
Yield
Amount
Yield
Amount
Yield
$
%
$
16,612
4.3
%
$
12,463
5.2
%
$
490
3.4
%
$
29,565
4.7
%
%
43,097
4.5
%
27,089
5.3
%
1,488
3.9
%
71,674
4.8
%
%
6,774
5.1
%
45,545
5.6
%
5.2
%
52,319
5.5
%
%
3,180
4.9
%
40,809
5.6
%
400
5.4
%
44,389
5.5
%
$
%
$
69,663
4.5
%
$
125,906
5.5
%
$
2,378
5.2
%
$
197,947
5.2
%
$
%
$
%
$
1,578
5.0
%
$
%
$
1,578
5.0
%
%
15,750
4.2
%
6,786
4.4
%
%
22,536
4.3
%
%
1,997
4.8
%
922
5.0
%
%
2,919
4.8
%
%
%
%
%
%
$
%
$
17,747
4.3
%
$
9,286
4.6
%
$
%
$
27,033
4.4
%
$
%
$
%
$
2,240
4.5
%
$
398
3.2
%
$
2,638
4.3
%
%
30,105
4.7
%
22,121
5.2
%
1,427
3.4
%
53,653
4.9
%
%
7,524
5.2
%
28,848
5.4
%
%
36,372
5.4
%
%
%
8,750
5.7
%
%
8,750
5.7
%
$
%
$
37,629
4.8
%
$
61,959
5.3
%
$
1,825
3.4
%
$
101,413
5.1
%
$
%
$
%
$
154
5.6
%
$
%
$
154
5.6
%
%
15,750
4.2
%
5,777
4.9
%
%
21,527
4.4
%
%
1,997
4.8
%
3,579
5.0
%
%
5,576
4.9
%
%
%
%
%
%
$
%
$
17,747
4.3
%
$
9,510
5.0
%
$
%
$
27,257
4.5
%
Table of Contents
December 31,
December 31,
2007
Percent
2006
Percent
$
400,120
12.1
%
$
300,978
16.1
%
410,661
12.4
%
236,674
12.7
%
742,354
22.5
%
485,936
26.0
%
371,881
11.3
%
158,687
8.5
%
1,925,016
58.2
%
1,182,275
63.3
%
104,902
3.2
%
98,286
5.3
%
163,188
4.9
%
61,718
3.3
%
732,213
22.2
%
280,132
15.0
%
156,071
4.7
%
141,016
7.5
%
141,666
4.3
%
53,726
2.9
%
82,476
2.5
%
51,548
2.8
%
1,380,516
41.8
%
686,426
36.7
%
$
3,305,532
100.0
%
$
1,868,701
100.0
%
Balances
Weighted Avg. Rate
$
124,339
4.91
%
88,374
4.85
%
110,856
4.84
%
48,312
4.69
%
371,881
4.84
%
446,096
4.71
%
204,522
5.04
%
193,500
5.06
%
156,124
5.04
%
1,000,302
4.90
%
$
1,372,183
4.88
%
Table of Contents
Table of Contents
Table of Contents
Interest
Amount
Rates
$
15,554
5.02
%
15,000
5.01
%
13,250
4.56
%
NA
30,294
3.51
%
18,706
4.02
%
$
92,804
4.26
%
2007
2006
2005
$
156,071
$
141,016
$
65,834
48,862
92,804
25,000
29,500
2.81
%
4.33
%
3.16
%
Table of Contents
2007
2006
2005
3.75
%
4.26
%
5.36
%
3.21
%
$
216,321
$
166,520
$
69,767
48,862
9,985
18,702
92,804
25,000
35,500
$
181,621
$
101,144
$
54,811
5,544
1,260
1,607
38,528
6,284
24,208
4.06
%
4.28
%
2.40
%
5.15
%
5.26
%
3.51
%
4.97
%
4.70
%
2.65
%
Next 12
13-36
37-60
More than
months
months
months
60 months
Totals
$
1,167,747
$
185,837
$
18,599
$
$
1,372,183
156,071
156,071
64,416
28,250
30,294
18,706
141,666
10,310
20,619
51,547
82,476
1,846
3,551
2,703
10,227
18,327
$
1,400,390
$
238,257
$
103,143
$
28,933
$
1,770,723
Next 12
13-36
37-60
More than
months
months
months
60 months
Totals
$
559,721
$
90,174
$
44,496
$
139,502
$
833,893
84,504
12,301
1,500
98,305
$
644,225
$
102,475
$
45,996
$
139,502
$
932,198
Table of Contents
Table of Contents
Table of Contents
52
53
54
55
56
57
58
59
Table of Contents
Table of Contents
Pinnacle Financial Partners, Inc.:
March 5, 2008
Table of Contents
Pinnacle Financial Partners, Inc.:
March 5, 2008
Table of Contents
CONSOLIDATED BALANCE SHEETS
Table of Contents
CONSOLIDATED STATEMENTS OF INCOME
For the years ended December 31,
2007
2006
2005
$
129,888,784
$
92,005,602
$
35,166,671
13,961,714
12,614,623
9,086,134
3,066,519
2,016,044
1,115,486
4,014,424
3,059,750
939,369
150,931,441
109,696,019
46,307,660
61,671,734
40,032,020
13,690,649
7,371,490
4,329,327
1,315,122
6,176,205
4,381,878
2,263,851
75,219,429
48,743,225
17,269,622
75,712,012
60,952,794
29,038,038
4,719,841
3,732,032
2,151,966
70,992,171
57,220,762
26,886,072
7,941,029
4,645,685
977,386
3,455,808
2,463,205
1,835,757
2,486,884
2,122,702
1,858,077
1,868,184
1,247,898
1,908,440
1,180,839
16,472
114,410
4,854,217
3,505,903
1,218,123
22,520,927
15,786,518
5,393,574
36,145,588
27,469,275
13,130,779
10,260,915
7,521,602
3,766,593
160,367
1,676,455
1,234,497
698,232
1,995,267
1,510,048
618,060
2,144,018
1,783,230
621,883
1,635,831
7,475,072
5,469,777
2,818,352
60,479,565
46,624,260
21,032,016
33,033,533
26,383,020
11,247,630
9,992,178
8,455,987
3,192,362
$
23,041,355
$
17,927,033
$
8,055,268
$
1.43
$
1.28
$
0.96
$
1.34
$
1.18
$
0.85
16,100,076
13,954,077
8,408,663
17,255,543
15,156,837
9,464,500
Table of Contents
CONSOLIDATED STATEMENTS OF STOCKHOLDERS EQUITY
AND COMPREHENSIVE INCOME
Additional
Accumulated
Total
Common Stock
Paid-in
Unearned
Retained
Other Comprehensive
Stockholders
Shares
Amount
Capital
Compensation
Earnings
Income (Loss)
Equity
8,389,232
$
8,389,232
$
44,376,307
$
(37,250
)
$
5,127,023
$
24,863
$
57,880,175
20,953
20,953
153,808
174,761
16,366
16,366
360,797
(377,163
)
244,724
244,724
8,055,268
8,055,268
(2,918,503
)
(2,918,503
)
5,136,765
8,426,551
$
8,426,551
$
44,890,912
$
(169,689
)
$
13,182,291
$
(2,893,640
)
$
63,436,425
(169,689
)
169,689
130,168
130,168
1,240,724
1,370,892
22,057
22,057
(22,057
)
11,000
11,000
44,000
55,000
465,003
465,003
1,009,958
1,009,958
6,856,298
6,856,298
164,231,274
171,087,572
(187,609
)
(187,609
)
17,927,033
17,927,033
852,747
852,747
18,779,780
15,446,074
$
15,446,074
$
211,502,516
$
$
31,109,324
$
(2,040,893
)
$
256,017,021
99,862
99,862
883,429
983,291
42,301
42,301
(42,301
)
396,378
396,378
1,703,441
1,703,441
6,676,580
6,676,580
176,833,242
183,509,822
(299,397
)
(299,397
)
23,041,355
23,041,355
1,258,383
1,258,383
24,299,738
22,264,817
$
22,264,817
$
390,977,308
$
$
54,150,679
$
(782,510
)
$
466,610,294
Table of Contents
CONSOLIDATED STATEMENTS OF CASH FLOWS
For the years ended December 31,
2007
2006
2005
$
23,041,355
$
17,927,033
$
8,055,268
492,280
629,634
1,130,766
3,810,374
1,382,401
1,699,380
4,719,841
3,732,032
2,151,966
(16,472
)
(114,410
)
(1,858,077
)
(1,868,184
)
(1,247,898
)
2,099,819
1,474,961
244,724
3,977,708
(1,164,336
)
(575,755
)
(50,535
)
(105,809
)
(131,121
)
(169,808,372
)
(131,971,094
)
(102,874,134
)
169,599,685
134,301,622
100,730,532
(17,546,455
)
(6,103,122
)
(3,155,825
)
(2,011,851
)
(6,303,665
)
2,177,477
16,394,026
11,906,161
8,171,556
(78,978,057
)
(62,760,686
)
(116,361,069
)
770,400
6,791,867
51,518,109
35,568,504
32,935,215
(386,164,624
)
(297,565,733
)
(175,606,019
)
(6,071,813
)
(4,649,676
)
(3,438,916
)
36,230,539
38,149,471
(4,905,032
)
(6,107,658
)
(2,708,000
)
(385,681,546
)
(299,284,710
)
(258,386,922
)
346,584,243
229,745,145
239,423,716
(5,481,091
)
75,181,529
33,906,372
48,862,000
80,000,000
56,000,000
62,000,000
(102,304,513
)
(61,540,828
)
(74,000,000
)
30,928,000
20,619,000
20,619,000
55,000
877,482
1,239,771
174,761
105,809
131,121
(299,397
)
(187,609
)
399,272,533
321,243,129
282,123,849
29,985,013
33,864,580
31,908,483
92,518,850
58,654,270
26,745,787
$
122,503,863
$
92,518,850
$
58,654,270
Table of Contents
Table of Contents
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
For the years ended December 31,
2007
2006
2005
$
76,735,790
$
50,752,304
$
16,154,326
7,900,000
8,280,000
3,802,633
183,509,822
171,087,572
1,341,890
818,467
207,647
481,915
994,781
Table of Contents
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
Table of Contents
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
Table of Contents
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
2007
2006
2005
$
23,041,355
$
17,927,033
$
8,055,268
16,100,076
13,954,077
8,408,663
$
1.43
$
1.28
$
0.96
$
23,041,355
$
17,927,033
$
8,055,268
16,100,076
13,954,077
8,408,663
1,155,467
1,202,760
1,055,837
17,255,543
15,156,837
9,464,500
$
1.34
$
1.18
$
0.85
Table of Contents
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
$
60,795
147,766
855,887
129,334
8,085
49,854
1,251,721
957,076
61,383
27,107
1,045,566
$
206,155
Table of Contents
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
Table of Contents
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
Year ended December 31,
2007
2006(1)
(unaudited)
$
104,610
$
78,454
14,544
5,005
29,495
21,141
98,437
68,897
21,124
25,693
6,908
7,750
$
14,216
$
17,943
$
0.64
$
0.98
$
0.61
$
0.92
22,209,642
18,222,247
23,365,109
19,483,299
(1)
In preparation and as a result of the merger during 2007, Mid-America and
Pinnacle Financial incurred significant merger related charges of approximately $3.9
million in the aggregate, primarily for severance benefits, accelerated vesting of
defined compensation agreements, investment banker fees, etc. Including these charges
would have decreased pro forma net income for the year ended December 31, 2007 by
$2.35 million resulting in net income of $11,872,000 and a basic and fully diluted
pro forma net income per share of $0.53 and $0.51, respectively.
Table of Contents
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
$
37,420
39,476
545,598
114,288
13,168
42,937
792,887
583,992
17,767
18,851
620,610
$
172,277
Table of Contents
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
December 31, 2007
Gross
Gross
Amortized
Unrealized
Unrealized
Fair
Cost
Gains
Losses
Value
$
$
$
$
69,481,328
199,761
18,526
69,662,563
297,909,174
1,237,808
1,441,636
297,705,346
127,220,978
208,241
1,523,412
125,905,807
2,415,782
37,559
2,378,223
$
497,027,262
$
1,645,810
$
3,021,133
$
495,651,939
$
17,747,589
$
4,436
$
17,752,025
9,285,767
23,175
177,494
9,131,448
$
27,033,356
$
27,611
$
177,494
$
26,883,473
Table of Contents
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
December 31, 2006
Gross
Gross
Amortized
Unrealized
Unrealized
Fair
Cost
Gains
Losses
Value
$
$
$
$
38,076,428
9,739
457,321
37,628,846
220,397,093
455,203
3,028,241
217,824,055
62,215,952
131,412
388,124
61,959,240
1,887,475
62,188
1,825,287
$
322,576,948
$
596,354
$
3,935,874
$
319,237,428
Securities held-to-maturity:
$
17,747,278
$
$
378,528
$
17,368,700
9,509,648
284,113
9,225,535
$
27,256,876
$
$
662,641
$
26,594,235
Available-for-sale
Held-to-maturity
Fair
Amortized
Fair
Amortized Cost
Value
Cost
Value
$
29,574,165
$
29,565,012
$
1,578,186
$
1,571,404
71,667,981
71,674,128
22,535,568
22,403,338
52,785,286
52,318,514
2,919,602
2,908,731
45,090,656
44,388,939
$
199,118,088
$
197,946,593
$
27,033,356
$
26,883,473
Investments with an
Unrealized Loss of less than
Investments with an Unrealized
Total Investments with an
12 months
Loss of 12 months or longer
Unrealized Loss
Unrealized
Unrealized
Unrealized
Fair Value
Losses
Fair Value
Losses
Fair Value
Losses
$
13,942,078
$
25,198
$
2,985,600
$
14,400
$
16,927,678
$
39,598
51,240,090
181,098
97,593,453
1,260,537
148.833.543
1.441.635
54,467,544
1,193,763
35,481,739
486,071
89,949,283
1,679,834
527,115
300
1,451,108
37,260
1,978,223
37,560
$
120,176,827
$
1,400,359
$
137,511,900
$
1,798,268
$
257,688,727
$
3,198,627
Table of Contents
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
$
$
$
47,988,246
$
835,849
$
47,988,246
$
835,849
13,959,080
68,965
149,496,521
2,959,276
163,455,601
3,028,241
13,975,595
47,071
35,660,379
625,166
49,635,974
672,237
1,825,286
62,188
1,825,286
62,188
$
27,934,675
$
116,036
$
234,970,432
$
4,482,479
$
262,905,107
$
4,598,515
2007
2006
$
728,200,839
$
284,301,650
562,720,828
299,626,769
517,399,037
253,097,234
838,160,611
608,529,830
103,159,374
52,179,341
2,749,640,689
1,497,734,824
(28,470,207
)
(16,117,978
)
$
2,721,170,482
$
1,481,616,846
2007
2006
$
109,118,000
$
89,862,000
249,959,000
133,504,000
135,413,000
65,791,000
283,327,000
164,535,000
269,744,000
192,373,000
104,980,000
18,900
Table of Contents
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
2007
2006
2005
$
16,117,978
$
7,857,774
$
5,650,014
(1,341,890
)
(818,467
)
(207,647
)
279,491
244,343
263,441
8,694,787
5,102,296
4,719,841
3,732,032
2,151,966
$
28,470,207
$
16,117,978
$
7,857,774
Table of Contents
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
Range of Useful Lives
2007
2006
$
15,365,882
$
9,545,667
15 to 30 years
41,255,704
19,849,960
15 to 20 years
5,087,210
1,954,028
3 to 15 years
26,910,636
21,350,694
88,619,432
52,700,349
(20,233,486
)
(16,414,553
)
$
68,385,946
$
36,285,796
$
1,846,000
1,878,000
1,673,000
1,343,000
1,360,000
10,225,651
$
18,326,837
$
1,168,105,188
153,890,291
31,986,218
12,512,723
5,688,898
$
1,372,183,317
Table of Contents
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
Scheduled
Maturities
Interest Rate Ranges
$
15,554,292
4.4% to 5.2%
15,000,000
5.0%
13,250,485
4.1% to 5.0%
48,999,356
2.3% to 4.4%
$
92,804,133
4.3%
Table of Contents
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
Scheduled
Maturities
$
10,310,000
20,619,000
51,547,000
$
82,476,000
December 31, 2007
December 31, 2006
$
82,476
$
51,548
$
$
80,000
50,000
2,476
1,548
82,476
51,548
$
82,476
$
51,548
Table of Contents
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
Combined Summary Income Statement
Year ended December 31,
2007
2006
2005
$
3,965
$
2,504
$
986
$
3,965
$
2,504
$
986
Combined
Summary Statement of Stockholders Equity
Trust
Total
Preferred
Common
Retained
Stockholders
Securities
Stock
Earnings
Equity
$
10,000
$
310
$
$
10,310
986
986
20,000
619
20,619
(956
)
(956
)
(30
)
(30
)
$
30,000
$
929
$
$
30,929
2,504
2,504
20,000
619
20,619
(2,428
)
(2,428
)
(76
)
(76
)
$
50,000
$
1,548
$
$
51,548
3,965
3,965
30,000
928
30,928
(3,847
)
(3,847
)
(118
)
(118
)
$
80,000
$
2,476
$
$
82,476
Table of Contents
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
2007
$
700,000
(700,000
)
$
2007
2006
2005
$
6,422,436
$
9,073,193
$
3,589,487
(407,966
)
547,130
178,630
6,014,470
9,620,323
3,768,117
3,318,644
(971,418
)
(479,072
)
659,064
(192,918
)
(96,683
)
3,977,708
(1,164,336
)
(575,755
)
$
9,992,178
$
8,455,987
$
3,192,362
2007
2006
2005
$
11,561,737
$
9,234,057
$
3,824,194
163,214
230,238
54,085
(360,000
)
(300,000
)
(300,000
)
(889,716
)
(602,100
)
(339,900
)
(304,807
)
(91,049
)
(178,250
)
(15,159
)
(46,017
)
$
9,992,178
$
8,455,987
$
3,192,362
Table of Contents
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
2007
2006
$
11,104,038
$
6,654,334
1,398,865
1,337,983
485,398
1,251,636
433,049
1,535,688
1,156,680
585,568
559,888
316,407
346,402
298,169
1,662,445
546,491
23,889
17,991,425
11,705,505
5,620,575
1,563,078
6,803,830
4,473,076
266,981
853,829
770,156
838,845
440,642
14,384,060
7,246,952
$
3,607,365
$
4,458,553
Table of Contents
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
$
833,893,000
98,305,000
Table of Contents
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
Table of Contents
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
Weighted-
Weighted-
Average
Aggregate
Average
Contractual
Intrinsic
Exercise
Remaining Term
Value (1)
Number
Price
(in years)
(000s)
1,068,350
$
7.03
209,482
23.74
(20,953
)
5.93
(14,486
)
14.93
1,242,393
$
9.78
195,551
10.80
365,519
24.00
(130,168
)
9.69
(14,836
)
15.45
1,658,459
$
12.93
Table of Contents
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
Weighted-
Weighted-
Average
Aggregate
Average
Contractual
Intrinsic
Exercise
Remaining Term
Value (1)
Number
Price
(in years)
(000s)
487,835
14.54
376,543
30.66
(99,741
)
8.68
(465
)
21.37
(23,808
)
28.00
2,398,823
$
16.84
6.9
$
23,784
2,357,000
$
16.67
6.9
$
23,692
1,533,986
$
11.06
6.2
$
20,876
(1)
The aggregate intrinsic value is calculated as the difference between the exercise
price of the underlying awards and the quoted price of Pinnacle Financial common stock of
$25.42 per common share for the 2.1 million options and stock appreciation rights that were
in-the-money at December 31, 2007.
(2)
The 465 stock appreciation rights exercised during 2007 settled for 121 shares of Pinnacle Financial common stock.
Awards granted with
the intention to be
classified
as incentive stock
Non-qualified stock
options
option awards
Totals
$
481,009
$
1,222,432
$
1,703,441
479,560
479,560
$
481,009
$
742,872
$
1,223,881
$
0.03
$
0.05
$
0.08
$
0.03
$
0.04
$
0.07
Table of Contents
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
Awards granted
with
the intention to be
classified
as incentive stock
Non-qualified stock
options
option awards
Totals
$
586,924
$
423,034
$
1,009,958
165,956
165,956
$
586,924
$
257,078
$
844,002
$
0.04
$
0.02
$
0.06
$
0.04
$
0.02
$
0.06
2007
2006
2005
4.70
%
4.65
%
2.57
%
6.50 years
6.50 years
6.50 years
0.00
%
0.00
%
0.00
%
21.1
%
23.1
%
24.1
%
$
10.57
$
10.44
$
7.30
Table of Contents
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
Executive Management Awards
Board of Director Awards
(number of share awards)
Vested
Unvested
Totals
Vested
Unvested
Totals
8,016
12,196
20,212
18,057
18,057
4,400
4,400
(400
)
(400
)
12,753
(12,753
)
20,769
17,500
38,269
4,000
4,000
39,071
39,071
3,230
3,230
5,452
(5,452
)
4,000
(4,000
)
26,221
51,119
77,340
4,000
3,230
7,230
2007
2006
2005
$
396,378
$
465,003
$
244,724
155,499
182,421
93,705
$
240,879
$
282,582
$
151,019
$
0.01
$
0.02
$
0.02
$
0.01
$
0.02
$
0.02
Table of Contents
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
2005
$
8,055,268
Add: Compensation expense recognized in the accompanying consolidated
statement of income, net of related tax effects
167,981
Deduct: Total stock-based compensation expense determined under the fair
value based method for all awards, net of related tax effects
(859,350
)
$
7,363,899
As reported
$
0.96
Pro forma
0.88
As reported
$
0.85
Pro forma
0.78
December 31, 2007
Notional Amount
Estimated Fair Value
$
25,415
$
504
25,415
(504
)
$
50,830
$
Table of Contents
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
Table of Contents
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
December 31, 2007
December 31, 2006
Estimated
Estimated Fair
Carrying Amount
Fair Value
Carrying Amount
Value
$
122,504
$
122,504
$
92,519
$
92,519
495,652
495,652
319,237
319,237
27,033
26,883
27,257
26,594
11,252
11,252
5,654
5,654
2,721,170
2,705,663
1,481,617
1,469,642
504
504
$
3,081,390
$
3,077,828
$
1,763,427
$
1,761,178
92,804
92,576
53,726
53,481
48,862
48,862
82,476
83,293
51,548
52,110
504
504
Notional
Notional
Amount
Amount
$
833,893
$
$
532,383
$
98,305
234
52,961
159
Table of Contents
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
Minimum
To Be Well-Capitalized
Minimum
Under Prompt
Capital
Corrective
Actual
Requirement
Action Provisions
Amount
Ratio
Amount
Ratio
Amount
Ratio
Pinnacle Financial
$
322,146
10.4
%
$
248,263
8.0
%
not applicable
$
214,201
10.1
%
$
169,825
8.0
%
$
212,282
10.0
%
$
56,822
10.1
%
$
45,026
8.0
%
$
56,283
10.0
%
$
41,946
10.4
%
$
32,155
8.0
%
$
40,193
10.0
%
Pinnacle Financial
$
293,676
9.5
%
$
124,132
4.0
%
not applicable
$
194,804
9.2
%
$
84,913
4.0
%
$
127,369
6.0
%
$
51,550
9.2
%
$
22,513
4.0
%
$
33,770
6.0
%
$
38,089
9.5
%
$
16,077
4.0
%
$
24,116
6.0
%
Pinnacle Financial
$
293,676
11.6
%
$
101,515
4.0
%
not applicable
$
194,804
8.5
%
$
91,273
4.0
%
$
114,091
5.0
%
$
51,550
8.3
%
$
24,976
4.0
%
$
31,220
5.0
%
$
38,089
7.6
%
$
19,908
4.0
%
$
24,886
5.0
%
Table of Contents
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
Minimum
To Be Well-Capitalized
Minimum
Under Prompt
Capital
Corrective
Actual
Requirement
Action Provisions
Amount
Ratio
Amount
Ratio
Amount
Ratio
$
202,881
11.8
%
$
137,638
8.0
%
not applicable
$
175,159
10.2
%
$
137,340
8.0
%
$
171,676
10.0
%
$
186,763
10.9
%
$
68,819
4.0
%
not applicable
$
159,031
9.3
%
$
68,670
4.0
%
$
103,005
6.0
%
$
186,763
9.5
%
$
79,021
4.0
%
not applicable
$
159,031
8.1
%
$
79,056
4.0
%
$
98,820
5.0
%
(*)
Average assets for the above calculations were based on the most recent quarter.
Trust and
Commercial
Investment
Mortgage
Insurance
Total
Banking
Services
Origination
Services
Company
$
75,541
$
$
171
$
$
75,712
4,720
4,720
12,492
4,743
2,792
2,494
22,521
52,929
3,484
2,249
1,818
60,480
8,949
494
280
269
9,992
$
21,435
$
765
$
434
$
407
$
23,041
$
60,953
$
$
$
$
60,953
3,732
3,732
8,705
3,316
1,647
2,119
15,787
41,930
2,375
976
1,343
46,624
7,508
369
263
317
8,457
$
16,488
$
572
$
408
$
459
$
17,927
$
29,038
$
$
$
$
29,038
2,152
2,152
2,675
1,573
1,146
5,394
19,315
1,171
546
21,032
2,809
154
230
3,193
$
7,437
$
248
$
370
$
$
8,055
Table of Contents
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
Trust and
Commercial
Investment
Mortgage
Insurance
Total
Banking
Services
Origination
Services
Company
$
3,773,874
$
400
$
15,074
$
4,822
$
3,794,170
$
2,128,105
$
402
$
9,762
$
3,918
$
2,142,187
2007
2006
$
9,829,126
$
24,803,538
538,364,192
310,000
310,000
619,000
619,000
619,000
619,000
928,000
1,255,135
1,298,299
8,365,160
1,049,604
8,125,827
786,846
$
568,415,440
$
307,755,021
$
8,916,956
$
91,476,000
51,548,000
1,412,189
190,000
466,610,295
256,017,021
$
568,415,440
$
307,755,021
2007
2006
2005
$
347,787
$
267,154
$
133,748
4,012,243
2,504,033
985,645
2,099,819
1,474,960
244,724
303,827
245,528
58,772
(6,068,102
)
(3,957,367
)
(1,155,393
)
(2,195,146
)
(1,632,738
)
(438,270
)
Table of Contents
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
2007
2006
2005
(3,872,956
)
(2,324,629
)
(717,123
)
26,914,311
20,251,662
8,772,391
$
23,041,355
$
17,927,033
$
8,055,268
2007
2006
2005
$
23,041,355
$
17,927,033
$
8,055,268
2,099,819
1,474,960
244,724
(1,528,956
)
(1,921,194
)
1,000,352
77,960
1,118,127
(479,474
)
495,586
190,000
99,726
(50,535
)
(105,809
)
(131,121
)
67,501
(232,866
)
(26,914,311
)
(20,251,662
)
(8,772,391
)
(2,766,855
)
(1,826,723
)
97,670
(928,000
)
(619,000
)
(619,000
)
(20,250,000
)
(10,000,000
)
(15,500,000
)
(350,250
)
(183,721
)
(1,189,488
)
(65,647
)
(21,557,773
)
3,128,116
(43,925,261
)
(7,906,781
)
(16,302,721
)
30,928,000
20,619,000
20,619,000
55,000
983,292
1,239,771
174,761
105,809
131,121
(299,397
)
(187,609
)
31,717,704
21,857,283
20,793,761
(14,974,412
)
12,123,779
4,588,710
24,803,538
12,679,759
8,091,049
$
9,829,126
$
24,803,538
$
12,679,759
Table of Contents
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
First
Second
Third
Fourth
(in thousands, except per share data)
Quarter
Quarter
Quarter
Quarter
$
33,739
$
35,508
$
38,347
$
43,338
17,082
17,661
18,960
22,009
788
900
772
2,260
8,196
7,828
8,410
8,599
5,602
5,426
5,772
6,242
$
0.36
$
0.35
$
0.37
$
0.35
$
0.34
$
0.33
$
0.35
$
0.33
$
16,811
$
28,305
$
31,340
$
33,241
9,507
16,895
17,159
17,391
387
1,707
587
1,051
3,839
6,463
7,942
8,139
2,612
4,322
5,347
5,646
$
0.27
$
0.28
$
0.35
$
0.37
$
0.24
$
0.26
$
0.32
$
0.34
$
9,270
$
10,544
$
12,379
$
14,118
6,503
6,795
7,456
8,287
601
483
366
702
2,499
2,762
2,867
3,119
1,780
1,959
2,078
2,238
$
0.21
$
0.23
$
0.25
$
0.27
$
0.19
$
0.21
$
0.22
$
0.24
Table of Contents
Table of Contents
Number of
Securities
Remaining Available
Number of
for Future Issuance
Securities to be
Under Equity
Issued upon
Weighted Average
Compensation Plans
Exercise of
Exercise Price of
(Excluding
Outstanding
Outstanding
Securities
Options, Warrants
Options, Warrants
Reflected in First
Plan Category
and Rights
and Rights
Column)
844,127
$
6.19
982,484
$
27.73
728,661
98,456
$
10.86
68,223
$
17.06
40,557
$
7.52
113,024
$
12.89
251,952
$
15.65
88,435
N/A
N/A
N/A
2,398,823
$
16.84
817,096
Table of Contents
Exhibit
No.
Description
Merger Agreement, dated September 30, 2005, by and between Pinnacle Financial Partners,
Inc. and Cavalry Bancorp, Inc. (schedules and exhibits to which been omitted pursuant
to Items 601(b)(2) of Regulations S-K)
(1)
Agreement and Plan of Merger by and between Pinnacle Financial Partners, Inc. and
Mid-America Bancshares, Inc. (schedules and exhibits to which been omitted pursuant to
Items 601(b)(2) of Regulations S-K)
(2)
Amended and Restated Charter
(3)
Bylaws
(4)
Specimen Common Stock Certificate
(5)
See Exhibits 3.1 and 3.2 for provisions of the Charter and Bylaws defining rights of
holders of the Common Stock
Lease Agreement by and between TMP, Inc. (former name of Pinnacle Financial Partners,
Inc.) and Commercial Street Associates dated March 16, 2000 (main office)
(5)
Form of Pinnacle Financial Partners, Inc.s Organizers Warrant Agreement
(5)
Employment Agreement dated as of August 1, 2000 by and between Pinnacle National Bank,
Pinnacle Financial Partners, Inc. and Robert A. McCabe, Jr.
(5) *
Employment Agreement dated as of April 1, 2000 by and between Pinnacle National Bank,
Pinnacle Financial Partners, Inc. and Hugh M. Queener
(5) *
Letter Agreement dated March 14, 2000 and accepted March 16, 2000 by and between
Pinnacle Financial Corporation (now known as Pinnacle Financial Partners, Inc.) and
Atkinson Public Relations
(5)
Employment Agreement dated March 1, 2000 by and between Pinnacle National Bank,
Pinnacle Financial Partners, Inc. and M. Terry Turner
(5)
*
Pinnacle Financial Partners, Inc. 2000 Stock Incentive Plan
(5)
*
Form of Pinnacle Financial Partners, Inc.s Stock Option Award
(5)
*
Agreement for Assignment of Lease by and between Franklin National Bank and TMP, Inc.,
now known as Pinnacle Financial Partners, Inc., effective July 17, 2000
(5)
Form of Assignment of Lease and Consent of Landlord by Franklin National Bank, Pinnacle
Financial Partners, Inc., formerly TMP, Inc., and Stearns Investments, Jack J. Stearns
and Edna Stearns, General Partners
(5)
Green Hills Office Lease
(6)
Form of Restricted Stock Award Agreement
(7)
Form of Incentive Stock Option Agreement
(7)
Lease Agreement for West End Lease
(8)
Lease Amendments for Commerce Street location
(8)
Pinnacle Financial Partners, Inc. 2004 Equity Incentive Plan
(9) *
2007 Annual Cash Incentive Plan
(10) *
Fourth Amendment to Commerce Street Lease
(3)
Employment Agreement by and between Pinnacle National Bank and Ed C. Loughry, Jr.
(11) *
Employment Agreement by and between Pinnacle National Bank and William S. Jones
(11) *
Consulting Agreement by and between Pinnacle National Bank and Ronnie F. Knight
(11) *
Form of Restricted Stock Agreement for non-employee directors
(12) *
Form of Non-Qualified Stock Option Agreement
(13)
*
2006 Annual Cash Incentive Plan
(14)
*
Employment Agreement dated as of March 14, 2006 by and among Pinnacle Financial
Partners, Inc., Pinnacle National Bank and Harold R. Carpenter
(14)
*
Calvary Bancorp, Inc. 1999 Stock Option Plan
(15)
*
Amendment No. 1 to Calvary Bancorp, Inc. 1999 Stock Option Plan
(15)*
Form of Non-Qualified Stock Option Agreement
(15)
*
Amendment No. 1 to Pinnacle Financial Partners, Inc. 2000 Stock Incentive Plan
(15)*
Amendment No. 3 to Pinnacle Financial Partners, Inc. 2004 Equity Incentive Plan
(15)*
Form of Restricted Stock Award Agreement*
(16)
Amendment No. 4 to Pinnacle Financial Partners, Inc. 2004 Equity Incentive Plan
(17)
2008 Annual Cash Incentive Plan
(18)
*
Form of Restricted Stock Award Agreement
(18)
*
2008 Special Cash Incentive Plan
(19)
*
2008 Director and Named Executive Officer Compensation Summary*
Amendment to Employment Agreement by and among Pinnacle National Bank, Pinnacle
Financial Partners, Inc. and M. Terry Turner *
Amendment to Employment Agreement by and among Pinnacle National Bank, Pinnacle
Financial Partners, Inc. and Robert A. McCabe, Jr. *
Amendment to Employment Agreement by and among Pinnacle National Bank, Pinnacle
Financial Partners, Inc.
Table of Contents
Exhibit
No.
Description
and Hugh M. Queener *
Employment Agreement by and among Pinnacle National Bank, Pinnacle
Financial Partners, Inc. and Harold R. Carpenter *
Bank of the South 2001 Stock Option Plan *
PrimeTrust Bank 2001 Statutory Nonstatutory Stock Option Plan *
PrimeTrust Bank 2005 Statutory Nonstatutory Stock Option Plan *
Mid-America Bancshares, Inc. 2006 Equity Incentive Plan *
Subsidiaries of Pinnacle Financial Partners, Inc.
Consent of KPMG LLP
Certification pursuant to Rule 13a-14(a)/15d-14(a)
Certification pursuant to Rule 13a-14(a)/15d-14(a)
Certification pursuant to 18 USC Section 1350 Sarbanes-Oxley Act of 2002
Certification pursuant to 18 USC Section 1350 Sarbanes-Oxley Act of 2002
(*)
Management compensatory plan or arrangement
(1)
Registrant hereby incorporates by reference to Registrants Current Report on Form 8-K
filed on October 3, 2005.
(2)
Registrant hereby incorporates by reference to Registrants Current Report on Form 8-K
filed on August 15, 2007.
(3)
Registrant hereby incorporates by reference to Registrants Form 10-Q for the quarter
ended March 31, 2005.
(4)
Registrant hereby incorporates by reference to Registrants Current Report on Form 8-K
filed on September 21, 2007.
(5)
Registrant hereby incorporates by reference to the Registrants Registration Statement
on Form SB-2, as amended (File No. 333-38018).
(6)
Registrant hereby incorporates by reference to the Registrants Form 10-KSB for the
fiscal year ended December 31, 2000 as filed with the SEC on March 29, 2001.
(7)
Registrant hereby incorporates by reference to Registrants Form 10-Q for the quarter
ended September 30, 2004.
(8)
Registrant hereby incorporates by reference to Registrants Form 10-K for the fiscal
year ended December 31, 2004 as filed with the SEC on February 28, 2005.
(9)
Registrant hereby incorporates by reference to Registrants Current Report on Form 8-K
filed on April 19, 2005.
(10)
Registrant hereby incorporates by reference to Registrants Current Report on Form 8-K
filed on January 25, 2007.
(11)
Registrant hereby incorporates by reference to Registrants Registration Statement on
Form S-4, as amended (File No. 333-129076).
(12)
Registrant hereby incorporates by reference to Registrants Current Report on Form
8-K filed on January 23, 2006.
(13)
Registrant hereby incorporates by reference to Registrants Form 10-K for the fiscal
year ended December 31, 2005 as filed with the SEC on February 24, 2006.
(14)
Registrant hereby incorporates by reference to Registrants Current Report on Form 8-K
filed on March 20, 2006.
(15)
Registrant hereby incorporates by reference to Registrants Form 10-Q for the quarter
ended on September 30, 2006.
(16)
Registrant hereby incorporates by reference to Registrants Form 10-K for the fiscal
year ended December 31, 2006 as filed with the SEC on February 28, 2007.
(17)
Registrant hereby incorporates by reference to Registrants Current Report on Form 8-K
filed on December 4, 2007.
(18)
Registrant hereby incorporates by reference to Registrants Current Report on Form 8-K
filed on January 25, 2008.
(19)
Registrant hereby incorporates by reference to Registrants Current Report on Form 8-K
filed on January 25, 2008.
Table of Contents
PINNACLE FINANCIAL PARTNERS, INC
By:
/s/ M. Terry Turner
M. Terry Turner
Date: March 7, 2008
President and Chief Executive Officer
SIGNATURES
TITLE
DATE
Chairman of the Board
March 7, 2008
Director, President and Chief Executive
Officer
(Principal Executive Officer)
March 7, 2008
Chief Financial Officer
(Principal Financial and Accounting Officer)
March 7, 2008
Director
March 7, 2008
Director
March 7, 2008
Director
March 7, 2008
Director
March 7, 2008
Director
March 7, 2008
Director
March 7, 2008
Director
March 7, 2008
Director
March 7, 2008
Director
March 7, 2008
Director
March 7, 2008
Director
March 7, 2008
Table of Contents
SIGNATURES
TITLE
DATE
Director
March 7, 2008
Director
March 7, 2008
Director
March 7, 2008
Director
March 7, 2008
Table of Contents
Exhibit
No.
Description
Merger Agreement, dated September 30, 2005, by and between Pinnacle Financial Partners,
Inc. and Cavalry Bancorp, Inc. (schedules and exhibits to which been omitted pursuant
to Items 601(b)(2) of Regulations S-K)
(1)
Agreement and Plan of Merger by and between Pinnacle Financial Partners, Inc. and
Mid-America Bancshares, Inc. (schedules and exhibits to which been omitted pursuant to
Items 601(b)(2) of Regulations S-K)
(2)
Amended and Restated Charter
(3)
Bylaws
(4)
Specimen Common Stock Certificate
(5)
See Exhibits 3.1 and 3.2 for provisions of the Charter and Bylaws defining rights of
holders of the Common Stock
Lease Agreement by and between TMP, Inc. (former name of Pinnacle Financial Partners,
Inc.) and Commercial Street Associates dated March 16, 2000 (main office)
(5)
Form of Pinnacle Financial Partners, Inc.s Organizers Warrant Agreement
(5)
Employment Agreement dated as of August 1, 2000 by and between Pinnacle National Bank,
Pinnacle Financial Partners, Inc. and Robert A. McCabe, Jr.
(5) *
Employment Agreement dated as of April 1, 2000 by and between Pinnacle National Bank,
Pinnacle Financial Partners, Inc. and Hugh M. Queener
(5) *
Letter Agreement dated March 14, 2000 and accepted March 16, 2000 by and between
Pinnacle Financial Corporation (now known as Pinnacle Financial Partners, Inc.) and
Atkinson Public Relations
(5)
Employment Agreement dated March 1, 2000 by and between Pinnacle National Bank,
Pinnacle Financial Partners, Inc. and M. Terry Turner
(5)
*
Pinnacle Financial Partners, Inc. 2000 Stock Incentive Plan
(5)
*
Form of Pinnacle Financial Partners, Inc.s Stock Option Award
(5)
*
Agreement for Assignment of Lease by and between Franklin National Bank and TMP, Inc.,
now known as Pinnacle Financial Partners, Inc., effective July 17, 2000
(5)
Form of Assignment of Lease and Consent of Landlord by Franklin National Bank, Pinnacle
Financial Partners, Inc., formerly TMP, Inc., and Stearns Investments, Jack J. Stearns
and Edna Stearns, General Partners
(5)
Green Hills Office Lease
(6)
Form of Restricted Stock Award Agreement
(7)
Form of Incentive Stock Option Agreement
(7)
Lease Agreement for West End Lease
(8)
Lease Amendments for Commerce Street location
(8)
Pinnacle Financial Partners, Inc. 2004 Equity Incentive Plan
(9) *
2007 Annual Cash Incentive Plan
(10) *
Fourth Amendment to Commerce Street Lease
(3)
Employment Agreement by and between Pinnacle National Bank and Ed C. Loughry, Jr.
(11) *
Employment Agreement by and between Pinnacle National Bank and William S. Jones
(11) *
Consulting Agreement by and between Pinnacle National Bank and Ronnie F. Knight
(11) *
Form of Restricted Stock Agreement for non-employee directors
(12) *
Form of Non-Qualified Stock Option Agreement
(13)
*
2006 Annual Cash Incentive Plan
(14)
*
Employment Agreement dated as of March 14, 2006 by and among Pinnacle Financial
Partners, Inc., Pinnacle National Bank and Harold R. Carpenter
(14)
*
Calvary Bancorp, Inc. 1999 Stock Option Plan
(15)
*
Amendment No. 1 to Calvary Bancorp, Inc. 1999 Stock Option Plan
(15)*
Form of Non-Qualified Stock Option Agreement
(15)
*
Amendment No. 1 to Pinnacle Financial Partners, Inc. 2000 Stock Incentive Plan
(15)*
Amendment No. 3 to Pinnacle Financial Partners, Inc. 2004 Equity Incentive Plan
(15)*
Form of Restricted Stock Award Agreement*
(16)
Amendment No. 4 to Pinnacle Financial Partners, Inc. 2004 Equity Incentive Plan
(17)
2008 Annual Cash Incentive Plan
(18)
*
Form of Restricted Stock Award Agreement
(18)
*
2008 Special Cash Incentive Plan
(19)
*
2008 Director and Named Executive Officer Compensation Summary*
Amendment to Employment Agreement by and among Pinnacle National Bank, Pinnacle
Financial Partners, Inc. and M. Terry Turner *
Amendment to Employment Agreement by and among Pinnacle National Bank, Pinnacle
Financial Partners, Inc. and Robert A. McCabe, Jr. *
Amendment to Employment Agreement by and among Pinnacle National Bank, Pinnacle
Financial Partners, Inc.
Table of Contents
Exhibit
No.
Description
and Hugh M. Queener *
Employment Agreement by and among Pinnacle National Bank, Pinnacle
Financial Partners, Inc. and Harold R. Carpenter *
Bank of the South 2001 Stock Option Plan *
PrimeTrust Bank 2001 Statutory Nonstatutory Stock Option Plan *
PrimeTrust Bank 2005 Statutory Nonstatutory Stock Option Plan *
Mid-America Bancshares, Inc. 2006 Equity Incentive Plan *
Subsidiaries of Pinnacle Financial Partners, Inc.
Consent of KPMG LLP
Certification pursuant to Rule 13a-14(a)/15d-14(a)
Certification pursuant to Rule 13a-14(a)/15d-14(a)
Certification pursuant to 18 USC Section 1350 Sarbanes-Oxley Act of 2002
Certification pursuant to 18 USC Section 1350 Sarbanes-Oxley Act of 2002
(*)
Management compensatory plan or arrangement
(1)
Registrant hereby incorporates by reference to Registrants Current Report on Form 8-K
filed on October 3, 2005.
(2)
Registrant hereby incorporates by reference to Registrants Current Report on Form 8-K
filed on August 15, 2007.
(3)
Registrant hereby incorporates by reference to Registrants Form 10-Q for the quarter
ended March 31, 2005.
(4)
Registrant hereby incorporates by reference to Registrants Current Report on Form 8-K
filed on September 21, 2007.
(5)
Registrant hereby incorporates by reference to the Registrants Registration Statement
on Form SB-2, as amended (File No. 333-38018).
(6)
Registrant hereby incorporates by reference to the Registrants Form 10-KSB for the
fiscal year ended December 31, 2000 as filed with the SEC on March 29, 2001.
(7)
Registrant hereby incorporates by reference to Registrants Form 10-Q for the quarter
ended September 30, 2004.
(8)
Registrant hereby incorporates by reference to Registrants Form 10-K for the fiscal
year ended December 31, 2004 as filed with the SEC on February 28, 2005.
(9)
Registrant hereby incorporates by reference to Registrants Current Report on Form 8-K
filed on April 19, 2005.
(10)
Registrant hereby incorporates by reference to Registrants Current Report on Form 8-K
filed on January 25, 2007.
(11)
Registrant hereby incorporates by reference to Registrants Registration Statement on
Form S-4, as amended (File No. 333-129076).
(12)
Registrant hereby incorporates by reference to Registrants Current Report on Form
8-K filed on January 23, 2006.
(13)
Registrant hereby incorporates by reference to Registrants Form 10-K for the fiscal
year ended December 31, 2005 as filed with the SEC on February 24, 2006.
(14)
Registrant hereby incorporates by reference to Registrants Current Report on Form 8-K
filed on March 20, 2006.
(15)
Registrant hereby incorporates by reference to Registrants Form 10-Q for the quarter
ended on September 30, 2006.
(16)
Registrant hereby incorporates by reference to Registrants Form 10-K for the fiscal
year ended December 31, 2006 as filed with the SEC on February 28, 2007.
(17)
Registrant hereby incorporates by reference to Registrants Current Report on Form 8-K
filed on December 4, 2007.
(18)
Registrant hereby incorporates by reference to Registrants Current Report on Form 8-K
filed on January 25, 2008.
(19)
Registrant hereby incorporates by reference to Registrants Current Report on Form 8-K
filed on January 25, 2008.
Table of Contents
Executive Officer | Current Base Salary | 2007 Cash Bonus | ||||||
|
||||||||
M. Terry Turner CEO
|
$ | 643,000 | $ | | ||||
Robert A. McCabe, Jr. Chairman of the Board
|
$ | 610,000 | $ | | ||||
Hugh M. Queener CAO
|
$ | 300,000 | $ | | ||||
Harold R. Carpenter CFO
|
$ | 300,000 | $ | | ||||
Charles B. McMahan Sr. Credit Officer
|
$ | 200,000 | $ | |
| Receive cash bonuses under the Companys 2008 Cash Incentive Plan; | ||
| Participate in a merger-related Special Cash Incentive Plan during 2008; | ||
| Participate in the Companys equity incentive programs, which currently involves the award of non-qualified stock options and restricted stock pursuant to the Companys 2004 Equity Incentive Plan; and | ||
| Participate in the Companys broad-based benefit programs generally available to its employees, including health, disability and life insurance programs and the Companys 401k plan. |
Page 1
2
3
4
5
6
7
8
9
10
(i) | If to the Employer, to it at: | ||
Suite 300
211 Commerce Street Nashville, TN 37201 |
(ii) | If to the Executive, to him at: | ||
Suite 300
211 Commerce Street Nashville, TN 37201 |
11
12
13
THE BANK:
PINNACLE NATIONAL BANK |
||||
By: | ||||
Print Name: | HUGH M. QUEENER | |||
Title: |
SECRETARY, CHIEF ADMINISTRATION
OFFICER |
|||
THE COMPANY:
PINNACLE FINANCIAL PARTNERS, INC. |
||||
By: | ||||
Print Name: | HUGH M. QUEENER | |||
Title: | SECRETARY, CHIEF ADMINISTRATION OFFICER | |||
THE EXECUTIVE:
|
||||
MICHAEL TERRY TURNER | ||||
14
2
3
4
5
6
7
8
9
10
(i) | If to the Employer, to it at: | ||
Suite 300
211 Commerce Street Nashville, TN 37201 |
|||
(ii) |
If to the Executive, to him at:
|
||
Suite 300
211 Commerce Street Nashville, TN 37201 |
11
12
13
2
3
4
5
6
7
8
9
10
11
12
THE BANK:
PINNACLE NATIONAL BANK |
||||
By: | ||||
Print Name: | HUGH M. QUEENER | |||
Title: | SECRETARY, CHIEF ADMINISTRATION OFFICER |
THE COMPANY:
PINNACLE FINANCIAL PARTNERS, INC. |
||||
By: | ||||
Print Name: | HUGH M. QUEENER | |||
Title: | SECRETARY, CHIEF ADMINISTRATION OFFICER | |||
THE EXECUTIVE:
HUGH M. QUEENER
|
||||
13
2
3
4
5
6
7
8
9
10
(i) | If to the Employer, to it at: | ||
Suite 300
211 Commerce Street Nashville, TN 37201 |
|||
(ii) | If to the Executive, to him at: | ||
Suite 300
211 Commerce Street Nashville, TN 37201 |
11
12
13
|
||||||
Article 1 Purposes of the Plan | 106 | |||||
|
||||||
Article 2 Certain Definitions and Terms | 106 | |||||
Section 2.1
|
Award | 106 | ||||
Section 2.2
|
Board | 106 | ||||
Section 2.3
|
Change of Control | 106 | ||||
Section 2.4
|
Code | 107 | ||||
Section 2.5
|
Company | 107 | ||||
Section 2.6
|
Company Stock | 107 | ||||
Section 2.7
|
Date of Grant | 107 | ||||
Section 2.8
|
Disability | 107 | ||||
Section 2.9
|
Exchange Act | 108 | ||||
Section 2.10
|
Fair Market Value | 108 | ||||
Section 2.11
|
Incentive Stock Option | 108 | ||||
Section 2.12
|
Nonstatutory Stock Option | 108 | ||||
Section 2.13
|
Option | 108 | ||||
Section 2.14
|
Parent | 108 | ||||
Section 2.15
|
Participant | 108 | ||||
Section 2.16
|
Restricted Stock | 108 | ||||
Section 2.17
|
Stock Option Committee | 108 | ||||
Section 2.18
|
Subsidiary | 108 | ||||
Section 2.19
|
Ten Percent Holder | 108 | ||||
|
||||||
Article 3 General Terms of the Plan | 109 | |||||
Section 3.1
|
Incentive and Nonstatutory Stock Options | 109 | ||||
Section 3.2
|
Stock | 109 | ||||
Section 3.3
|
Eligibility | 109 | ||||
|
||||||
Article 4 Grant and Exercise of Stock Options | 109 | |||||
Section 4.1
|
Stock Option Grants | 109 | ||||
Section 4.2
|
Exercise Price | 110 | ||||
Section 4.3
|
Full and Partial Exercise | 110 | ||||
Section 4.4
|
Vesting and Exercise on Change in Control | 111 | ||||
|
||||||
Article 5 Method of Exercise | 111 | |||||
Section 5.1
|
Method of Exercise of Options | 111 | ||||
Section 5.2
|
Restrictions, Taxes, and Other Limitations | 112 | ||||
|
||||||
Article 6 Administration of the Plan | 112 | |||||
Section 6.1
|
Administration of the Plan | 112 | ||||
Section 6.2
|
Committee Authority and Discretion | 112 | ||||
Section 6.3
|
Administrative Discretion, Etc | 113 | ||||
Section 6.4
|
Committee Rules; Binding Determination | 113 | ||||
Section 6.5
|
Actions by the Committee | 113 | ||||
|
||||||
Article 7 Transferability | 113 | |||||
|
||||||
Article 8 Effective Date of the Plan, Termination, and Related Matters | 114 | |||||
Section 8.1
|
Effective Date | 114 |
Section 8.2
|
Termination, Modification, Change | 114 | ||||
Section 8.3
|
Change in Capital Structure | 114 | ||||
|
||||||
Article 9 Effective Date of the Plan | 115 | |||||
|
||||||
Article 10 General Terms and Provisions of the Plan | 115 | |||||
Section 10.1
|
Notice | 115 | ||||
Section 10.2
|
Interpretation | 115 | ||||
Section 10.3
|
Shareholder Rights | 115 | ||||
Section 10.4
|
No Contract of Employment | 115 | ||||
Section 10.5
|
Withholding | 115 | ||||
Section 10.6
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Construction | 116 | ||||
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Article 11 Shareholder Approval | 116 |
2.3.1 | The acquisition, other than from the Company, by any individual, entity or group (within the meaning of Section 13(d)(3) or 14(d)(2) of the Exchange Act) of beneficial ownership (within the meaning of Rule 13d-3 promulgated under the Exchange Act) of 20% or more of either the then outstanding shares of Company Stock or the combined voting power of the then outstanding voting securities of the Company entitled to vote generally in the election of directors, but excluding for this purpose, any such acquisition by the Company or any of its subsidiaries, or any employee benefit plan (or related trust) of the Company or its subsidiaries, or any corporation with respect to which, following such acquisition, more than 50% of, respectively, the then outstanding shares of common stock of such corporation and the combined voting power of the then outstanding voting securities of such corporation entitled to vote generally in the election of directors is then beneficially owned, directly or indirectly, by the individuals and entities who were the beneficial owners, respectively, of the Common Stock and voting securities of the Company immediately prior to such acquisition in |
substantially the same proportion as their ownership, immediately prior to such acquisition, of the then outstanding shares of Common Stock of the Company or the combined voting power of all of the then outstanding voting securities of the Company entitled to vote generally in the election of directors, as the case may be; or |
2.3.2 | Individuals who, as of the date hereof, constitute the Board (as of the date hereof the Incumbent Board) cease for any reason to constitute at least a majority of the Board, provided that any individual becoming a director subsequent to the date hereof whose election or nomination for election by the Companys shareholders was approved by a vote of at least a majority of the directors then comprising the Incumbent Board shall be considered as though such individual were a member of the Incumbent Board, but excluding, for this purpose, any such individual whose initial assumption of office is in connection with an actual or threatened election contest relating to the election of the Directors of the Company (as such terms are used in Rule 14a-11 of Regulation 14A promulgated under the Exchange Act); or | ||
2.3.3 | Approval by the shareholders of the Company of a reorganization, merger or consolidation, in each case, with respect to which the individuals and entities who were the respective beneficial owners of the Common Stock and voting securities of the Company immediately prior to such reorganization, merger or consolidation do not, following such reorganization, merger or consolidation, beneficially own, directly or indirectly, more than 50% of, respectively, the then outstanding shares of common stock and the combined voting power of the then outstanding voting securities entitled to vote generally in the election of directors, as the case may be, of the corporation resulting from such reorganization, merger or consolidation, or a complete liquidation or dissolution of the Company or of its sale or other disposition of all or substantially all of the assets of the Company. |
3.3.1 | Any employee of the Company (or Parent or Subsidiary of the Company) who, in the judgment of the Committee has contributed or can be expected to contribute to the profits or growth of the Company (or Parent or Subsidiary) shall be eligible to receive Incentive Stock Options under the Plan. Directors of the Company who are employees and are not members of the Committee are eligible to participate in the Plan. The Committee shall have the power and complete discretion, as provided in Article 6 , to select eligible employees to receive Awards and to determine for each employee the terms and conditions, the nature of the award and the number of shares to be allocated to each employee as part of each Award. | ||
3.3.2 | Any employee or director of the Company (or Parent or Subsidiary of the Company), whether or not an employee of the Company or any Parent or Subsidiary, who, in the judgment of the Committee has contributed or can be expected to contribute to the profits or growth of the Company (or Parent or Subsidiary) shall be eligible to receive Nonstatutory Stock Options under the Plan. The Committee shall have the power and complete discretion, as provided in Article 6 , to select participants to receive Awards and to determine for each Participant the terms and conditions, the nature of the award and the number of shares to be allocated to each Participant as part of each Award. | ||
3.3.3 | The grant of an Award shall not obligate the Company or any Parent or Subsidiary of the Company to pay an employee any particular amount of remuneration, to continue the employment of the employee after the grant or to make further grants to the employee at any time thereafter. |
4.3.1 | No Incentive Stock Option may be exercised after the first to occur of (x) ten years (or, in the case of an Incentive Stock Option granted to a 10% Shareholder, five years) from the Date of Grant, (y) three months from the employees retirement or termination of employment with the Company and its Parent and Subsidiary corporations for reasons other than Disability or death, or (z) one year from the employees termination of employment on account of Disability or death. | ||
4.3.2 | Except as otherwise provided in this paragraph, no Incentive Stock Option may be exercised unless the employee is employed by the Company or a Parent or Subsidiary of the Company at the time of the exercise (or was so employed not more than three months before the time of the exercise) and has been employed by the Company or a Parent or Subsidiary of the Company at all times since the Date of Grant. If an employees employment is terminated other than by reason of his Disability or death at a time when the employee holds an Incentive Stock Option that is exercisable (in whole or in part), the employee may exercise any or all of the exercisable portion of the Incentive Stock Option (to the extent exercisable on the date of termination) within three months after the employees termination of employment. If an employees employment is terminated by reason of his Disability at a time when the employee holds an Incentive Stock Option that is exercisable (in whole or in part), the employee may exercise any or all of the exercisable portion of the Incentive Stock Option (to the extent exercisable on the date of Disability) within one year after the employees termination of employment. If an employees employment is terminated by reason of his death at a time when the employee holds an Incentive Stock Option that is exercisable (in whole or in part), the Incentive Stock Option may be exercised (to the extent exercisable on the date of death) within one year after the |
employees death by the person to whom the employees rights under the Incentive Stock Option shall have passed by will or by the laws of descent and distribution. |
4.3.3 | An Incentive Stock Option by its terms, shall be exercisable in any calendar year only to the extent that the aggregate Fair Market Value (determined at the Date of Grant) of the Company Stock with respect to which incentive stock options are exercisable for the first time during the calendar year does not exceed $100,000 (the Limitation Amount). Incentive Stock Options granted under the Plan and similar incentive options granted under all other plans of the Company and any Parent or Subsidiary of the Company shall be aggregated for purposes of determining whether the Limitation Amount has been exceeded. The Board may impose such conditions as it deems appropriate on an Incentive Stock Option to ensure that the foregoing requirement is met. If Incentive Stock Options that first become exercisable in a calendar year exceed the Limitation Amount, the excess Options will be treated as Nonstatutory Stock Options to the extent permitted by law. | ||
4.3.4 | No Incentive or Nonstatutory Stock Option shall vest more rapidly than pro rata over three years (that is, one-third for each full year), nor shall any such option vest over more than ten years. |
8.3.1. | In the event of a stock dividend, stock split or combination of shares, recapitalization or merger in which the Company is the surviving corporation or other change in the Companys capital stock (including, but not limited to, the creation or issuance to shareholders generally of rights, options or warrants for the purchase of Common Stock or preferred stock of the Company), the number and kind of shares of stock or securities of the Company to be subject to the Plan and to Options then outstanding or to be granted thereunder, the maximum number of shares or securities which may be delivered under the Plan, the exercise price and other relevant provisions shall be appropriately adjusted by the Committee, whose determination shall be binding on all persons. If the adjustment would produce fractional shares with respect to any unexercised Option, the committee may adjust appropriately the number of shares covered by the Option so as to eliminate the fractional shares. | ||
8.3.2 | If the Company is a party to a consolidation or a merger in which the Company is not the surviving corporation, a transaction that results in the acquisition of substantially all of the Companys outstanding stock by a single person or entity, or a sale or transfer of substantially all of the Companys assets, the Committee may take such actions with respect to outstanding Awards as the Committee deems appropriate. | ||
8.3.3 | Notwithstanding anything in the Plan to the contrary, the Committee may take the foregoing actions without the consent of any Participant, and the Committees determination shall be conclusive and binding on all persons for all purposes. |
Bank of the South
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By: | /s/ David Major | |||
David Major, Chairperson | ||||
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PRIMETRUST BANK
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PRIMETRUST BANK
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PRIMETRUST BANK
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PARTICIPANT:
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PRIMETRUST BANK
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Its: |
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PRIMETRUST BANK
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and Chief Executive Officer | ||||
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(a) | The consummation of a merger or consolidation of the Company with or into another entity or any other corporate reorganization, if more than 50% of the combined voting power of the continuing or surviving entitys securities outstanding immediately after such merger, consolidation or other reorganization is owned by persons who were not stockholders of the Company immediately prior to such merger, consolidation or other reorganization; | ||
(b) | The sale, transfer or other disposition of all or substantially all of the Companys assets; | ||
(c) | A change in the composition of the Board, as a result of which fewer than 50% of the incumbent directors are directors who either (i) had been directors of the Company on the date 24 months prior to the date of the event that may constitute a Change in Control (the original directors) or (ii) were elected, or nominated for election, to the Board with the affirmative votes of at least a majority of the aggregate of the original directors who were still in office at the time of the election or nomination and the directors whose election or nomination was previously so approved; or | ||
(d) | Any transaction as a result of which any person is the beneficial owner (as defined in Rule 13d-3 under the Exchange Act), directly or indirectly, of securities of the Company representing more than 50% of the total voting power represented by the Companys then outstanding voting securities. For purposes of this Paragraph (d), the term person shall have the same meaning as when used in sections 13(d) and 14(d) of the Exchange Act but shall exclude (i) a trustee or other fiduciary holding securities under an employee benefit plan of the Company or of a Parent or Subsidiary and (ii) a corporation owned directly or indirectly by the stockholders of the Company in substantially the same proportions as their ownership of the common stock of the Company. A transaction shall not constitute a Change in Control if its sole purpose is to change the state of the Companys incorporation or to create a holding company that will be owned in substantially the same proportions by the persons who held the Companys securities immediately before such transaction. |
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(a) | Such requirements as the Securities and Exchange Commission may establish for administrators acting under plans intended to qualify for exemption under Rule 16b-3 (or its successor) under the Exchange Act; and | ||
(b) | Such requirements as the Internal Revenue Service may establish for outside directors acting under plans intended to qualify for exemption under Section 162(m) of the Code. |
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(a) | the aggregate number and kind of shares subject to Awards made hereunder may be adjusted appropriately; and | ||
(b) | rights under outstanding Awards made to Eligible Persons hereunder, both as to the number of subject shares and the Exercise Price, may be adjusted appropriately. |
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(a) | Upon any separation from service for any reason other than his or her death or permanent and total Disability, a Participant shall have the right, subject to the restrictions of Sections 6.4 and 8.4, to exercise his or her Options or SARs at any time within three months after separation from service, but only to the extent that, at the date of such separation, the Participants right to exercise such Options or SARs had accrued pursuant to the terms of the Agreement and had not previously been exercised; provided, however, that, unless otherwise provided in the Agreement, if there occurs a separation from service for Cause or a separation from service by the Participant (other than on account of death or permanent and total Disability), any Options or SARs not exercised in full prior to such separation shall be canceled. Awards other than Options and SARs shall be forfeited upon any separation from service for any reason other than the Participants death or permanent and total Disability. | ||
(b) | If the Participant dies while a Participant or within three months after any separation from service other than for Cause or a separation by the Participant (other than on account of death or permanent and total Disability), then the Options or SARs may be exercised in full, subject to the restrictions of Sections 6.4 and 8.4, at any time within six months after the Participants death, by the beneficiary of the Participant, but only to the extent that, at the date of death, the Participants right to exercise such Options or SARs had accrued and had not been forfeited pursuant to the terms of the Agreement and had not previously |
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been exercised. Awards other than Options and SARs shall fully vest upon a Participants separation from service by reason of his or her death and Performance Units may be paid out at a target level of performance. | |||
(c) | Upon separation from service for reason of permanent and total Disability or death, a Participant or her or his estate shall have the right, subject to the restrictions of Sections 6.4 and 8.4 to exercise his or her Options or SARs at any time within three months after separation from service, but only to the extent that, at the date of such separation, the Participants right to exercise such Options or SARs had accrued pursuant to the terms of the applicable Agreement and had not previously been exercised. Distribution of earned Performance Units may be made at the same time payments are made to Participants who did not incur a separation from service. |
(a) | The continuation of the outstanding Awards by the Company, if the Company is a surviving corporation; | ||
(b) | The assumption of the outstanding Awards by the surviving corporation or its parent or subsidiary; | ||
(c) | The substitution by the surviving corporation or its parent or subsidiary of its own awards for the outstanding Awards; | ||
(d) | Full exercisability or vesting and accelerated expiration of the outstanding Awards; or Settlement of the full value of the outstanding Awards in cash or cash equivalents followed by cancellation of such Awards. |
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(a) | In the case of an ISO, the acceleration of exercisability shall not occur without the Optionees written consent. | ||
(b) | If the Company and the other party to the transaction constituting a Change in Control agree that such transaction is to be treated as a pooling of interests for financial reporting purposes, and if such transaction in fact is so treated, then the acceleration of exercisability shall not occur to the extent that the Companys independent accountants and such other partys independent accountants separately determine in good faith that such acceleration would preclude the use of pooling of interests accounting. |
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(a) | In the case of ISOs granted hereunder, the aggregate Fair Market Value (determined as of the date of the Awards thereof) of Common Shares with respect to which ISOs become exercisable by any Participant for the first time during any calendar year (under the Plan and all other plans maintained by the Company, Affiliates or Subsidiaries) shall not exceed $100,000. | ||
(b) | In the case of an individual described in Section 422(b)(6) of the Code (relating to certain 10% owners), the Exercise Price with respect to an ISO shall not be less than 110% of the Fair Market Value of a Common Share on the day the Option is granted, and the term of an ISO shall be no more than five years from the date of grant. | ||
(c) | If Common Shares acquired upon exercise of an ISO are disposed of in a disqualifying disposition within the meaning of Section 422 of the Code by a Participant prior to the expiration of either two years from the date of grant of such Option or one year from the transfer of such shares to the Participant pursuant to the exercise of such Option, or in any |
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other disqualifying disposition within the meaning of Section 422 of the Code, such Participant shall notify the Company in writing as soon as practicable thereafter of the date and terms of such disposition and, if the Company thereupon has a tax-withholding obligation, shall pay to the Company an amount equal to any withholding tax the Company is required to pay as a result of the disqualifying disposition. |
(a) | The termination of such Outside Directors service because of death, Disability or Retirement; or | ||
(b) | A Change in Control with respect to the Company; provided, however, if the Company and the other party to the transaction constituting a Change in Control agree that such transaction is to be treated as a pooling of interests for financial reporting purposes, and if such transaction in fact is so treated, then the acceleration of exercisability shall not occur to the extent that the Companys independent accountants and such other partys independent accountants separately determine in good faith that such acceleration would preclude the use of pooling of interests accounting. |
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(a) | Awards subject to this Section must vest (or may be granted or vest) solely on the attainment of one or more objective performance goals unrelated to term of employment. Awards will also be subject to the general vesting provisions provided in the Agreement and this Plan. | ||
(b) | Prior to completion of 25% of the period of performance or such earlier date as required under Section 162(m), the Committee must establish performance goals (in accordance with subsection (d) below) in writing (including but not limited to Committee minutes) for Covered Employees who will receive Awards that are intended as qualified performance- |
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based compensation. The outcome of the goal must be substantially uncertain at the time the Committee actually established the goal. |
(c) | The performance goal must state, in terms of an objective formula or standard, the method for computing the Award payable to the Participant if the goal is attained. The terms of the objective formula or standard must prevent any discretion being exercised by the Committee to later increase the amount payable that otherwise would be due upon attainment of the goal, but may allow discretion to decrease the amount payable. | ||
(d) | The material terms of the performance goal must be disclosed to and subsequently approved in a separate vote by the stockholders before the payout is executed, unless they conform to one or any combination of the following goals/targets, each determined in accordance with generally accepted accounting principles or similar objective standards (and/or each as may appear in the annual report to stockholders, Form 10K or Form 10Q): revenue; earnings (including earnings before interest, taxes, depreciation and amortization, earnings before interest and taxes, and earnings before or after taxes); operating income; net income; profit margins; earnings per share; return on assets; return on equity; return on invested capital; economic value-added; stock price; gross dollar volume; total shareholder return; market share; book value; expense management; cash flow; and customer satisfaction. |
(e) | A combination of the above performance goals may be used with a particular Agreement evidencing an Award. | ||
(f) | The Committee in its sole discretion in setting the goals/targets in the time prescribed above may provide for the making of equitable adjustments (singularly or in combination) to the goals/targets in recognition of unusual or nonrecurring events for the following qualifying objective items: asset impairments under Statement of Financial Accounting Standards No. 121, as amended or superseded; acquisition-related charges; accruals for restructuring and/or reorganization program charges; merger integration costs; merger transaction costs; any profit or loss attributable to the business operations of any entity or entities acquired during the period of service to which the performance goal relates; tax settlements; any extraordinary, unusual-in-nature, infrequent-in-occurrence, or other nonrecurring items (not otherwise listed) as described in Accounting Principles Board Opinion No. 30; any extraordinary, unusual-in-nature, infrequent-in-occurrence, or other nonrecurring items (not otherwise listed) in managements discussion and analysis of financial condition results of operations, selected financial data, financial statements and/or in the footnotes, each as appearing in the annual report to stockholders; unrealized gains or losses on investments; charges related to derivative transactions contemplated by Statement of Financial |
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Accounting Standards No. 133, as amended or superseded; and compensation charges related to FAS 123 (Revised) or its successor provision. |
(g) | The Committee must certify in writing prior to payout that the performance goals and any other material terms were in fact satisfied. In the manner required by Section 162(m) of the Code, the Committee shall, promptly after the date on which the necessary financial and other information for a particular period of performance becomes available, certify the extent to which performance goals have been achieved with respect to any Award intended to qualify as performance-based compensation under Section 162(m) of the Code. In addition, the Committee may, in its discretion, reduce or eliminate the amount of any Award payable to any Participant, based on such factors as the Committee may deem relevant. |
(a) | The independent auditors most recently selected by the Board (the Auditors) determine that the after-tax value of such Award to the Participant, taking into account the effect of all federal, state and local income taxes, employment taxes and excise taxes applicable to the Participant (including the excise tax under section 4999 of the Code), will be greater after the application of this Article than it was before the application of this Article; or |
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(b) | The Committee, at the time of making an Award under the Plan or at any time thereafter, specifies in writing that such Award shall be subject to this Article (regardless of the after-tax value of such Award to the Participant). |
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(a) | An Outside Director may elect to receive his or her annual retainer payments and/or meeting fees from the Company in the form of cash, NSOs, Restricted Shares or Stock Units, or a combination thereof, as determined by the Board. Such NSOs, Restricted Shares and Stock Units shall be issued under the Plan. An election under this Article 13 shall be filed with the Company on the prescribed form. | ||
(b) | The number of NSOs, Restricted Shares or Stock Units to be granted to Outside Directors in lieu of annual retainers and meeting fees that would otherwise be paid in cash shall be calculated in a manner determined by the Board. The terms of such NSOs, Restricted Shares or Stock Units shall also be determined by the Board. |
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(a) | It is the intention of the Company that no Award shall be deferred compensation subject to Section 409A of the Code, unless and to the extent that the Committee specifically determines otherwise as provided below, and the Plan and the terms and conditions of all Awards shall be interpreted accordingly. | ||
(b) | The terms and conditions governing any Awards that the Committee determines will be subject to Section 409A of the Code, including any rules for elective or mandatory deferral of the delivery of cash or Common Shares pursuant thereto and any rules regarding treatment of such Awards in the event of a Change in Control, shall be set forth in the applicable Agreement and shall comply in all respects with Section 409A of the Code. | ||
(c) | Following a Change in Control, no action shall be taken under the Plan that will cause any Award that the Committee has previously determined is subject to Section 409A of the Code to fail to comply in any respect with Section 409A of the Code without the written consent of the Participant. |
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MID-AMERICA BANCSHARES, INC. | ||||
By: | /s/ Gary L. Scott | |||
Gary L. Scott, Chairman | ||||
Adopted by the Board of Directors | Attest: | /s/ Jason K. West | ||
April 30, 2006 | Corporate Secretary | |||
Adopted by the Shareholders | Attest: | /s/ Jason K. West | ||
April 30, 2006 | Corporate Secretary | |||
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Jurisdiction or State of | Names Under Which | |||
Subsidiaries | Incorporation | Subsidiary Does Business (1) | ||
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Pinnacle National Bank (2)
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Tennessee | |||
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PrimeTrust Bank (8)
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Tennessee | |||
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Bank of the South (8)
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Tennessee | |||
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PFP Title Company (3)
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Tennessee | |||
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Pinnacle Community Development Corporation (3)
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Tennessee | |||
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PNFP Statutory Trust I (4)
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Connecticut | |||
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PNFP Statutory Trust II (4)
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Delaware | |||
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PNFP Statutory Trust III (4)
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Connecticut | |||
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PNFP Statutory Trust IV (4)
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Delaware | |||
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PNFP Holdings, Inc. (5)
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Nevada | |||
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PNFP Properties, Inc. (6)
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Maryland | |||
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Pinnacle Advisory Services, Inc. (7)
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Tennessee | |||
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Pinnacle Credit Enhancement Services, Inc. (7)
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Tennessee | |||
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Pinnacle Rutherford Real Estate, Inc. (3)
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Tennessee | |||
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Pinnacle Nashville Real Estate, Inc. (3)
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Tennessee | |||
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Pinnacle Rutherford Towers, Inc.(3)
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Tennessee | |||
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Pinnacle Service Company, Inc.(3)
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Tennessee | |||
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PNFP Insurance, Inc.(7)
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Nevada |
1. | Unless otherwise noted, each Subsidiary only does business under its legal name as set forth under the heading Subsidiaries. | |
2. | As a national bank, Pinnacle National Bank is organized under the federal laws of the United States of America. | |
3. | PFP Title Company, Pinnacle Community Development Corporation, Pinnacle Rutherford Real Estate, Inc., Pinnacle Nashville Real Estate, Inc., Pinnacle Rutherford Towers, Inc. and Pinnacle Service Company, Inc. are wholly-owned subsidiaries of Pinnacle National Bank. | |
4. | PNFP Statutory Trust I, PNFP Statutory Trust II, PNFP Statutory Trust III and Statutory Trust IV are statutory business trusts which were established to issue capital trust preferred securities. | |
5. | PNFP Holdings, Inc. is a wholly-owned subsidiary of PFP Title Company. | |
6. | PNFP Properties, Inc. is a wholly-owned subsidiary of PNFP Holdings, Inc. | |
7. | Pinnacle Advisory Services, Inc., Pinnacle Credit Enhancement Services, Inc. and PNFP Insurance, Inc. are wholly owned subsidiaries of Pinnacle Financial Partners, Inc. | |
8. | PrimeTrust Bank and Bank of the South were merged with Pinnacle National Bank on February 29, 2008. |
1.) | I have reviewed this annual report on Form 10-K of Pinnacle Financial Partners, Inc.; | ||
2.) | Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; | ||
3.) | Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report; | ||
4.) | The registrants other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f)) and 15d-15(f) for the registrant and have: |
(a) | Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; | ||
(b) | Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; | ||
(c) | Evaluated the effectiveness of the registrants disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and | ||
(d) | Disclosed in this report any change in the registrants internal control over financial reporting that occurred during the registrants most recent fiscal quarter (the registrants fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrants internal control over financial reporting; and |
5.) | The registrants other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrants auditors and the audit committee of the registrants board of directors (or persons performing the equivalent functions): |
(a) | All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrants ability to record, process, summarize and report financial information; and | ||
(b) | Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrants internal control over financial reporting. |
Date: March 7, 2008 | Signature: | /s/ M. Terry Turner | ||
M. Terry Turner | ||||
President and Chief Executive Officer |
1.) | I have reviewed this annual report on Form 10-K of Pinnacle Financial Partners, Inc.; | ||
2.) | Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; | ||
3.) | Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report; | ||
4.) | The registrants other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f)) and 15d-15(f) for the registrant and have: |
(a) | Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; | ||
(b) | Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; | ||
(c) | Evaluated the effectiveness of the registrants disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and | ||
(d) | Disclosed in this report any change in the registrants internal control over financial reporting that occurred during the registrants most recent fiscal quarter (the registrants fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrants internal control over financial reporting; and |
5.) | The registrants other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrants auditors and the audit committee of the registrants board of directors (or persons performing the equivalent functions): |
(a) | All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrants ability to record, process, summarize and report financial information; and | ||
(b) | Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrants internal control over financial reporting. |
Date: March 7, 2008 | Signature: | /s/ Harold R. Carpenter | ||
Harold R. Carpenter | ||||
Chief Financial Officer |
1. | The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities and Exchange Act of 1934; and | ||
2. | The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company. |
Date: March 7, 2008 | By: | /s/ M. Terry Turner | ||
M. Terry Turner | ||||
President and Chief Executive Officer
Pinnacle Financial Partners, Inc. |
1. | The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities and Exchange Act of 1934; and | ||
2. | The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company. |
Date: March 7, 2008 | By: | /s/ Harold R. Carpenter | ||
Harold R. Carpenter | ||||
Chief Financial Officer
Pinnacle Financial Partners, Inc. |
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