On September 18, 2020, Pinnacle Bankshares Corporation entered into a Subordinated Note Purchase Agreement with certain qualified institutional buyers and accredited investors (the “Purchasers”) pursuant to which the Company sold and issued $8.0 million in aggregate principal amount of 5.25% fixed-to-floating rate subordinated notes due 2030. The Notes will initially bear interest at 5.25% per annum, beginning September 18, 2020 to but excluding September 30, 2025, payable quarterly in arrears. From and including September 30, 2025 to but excluding September 30, 2030, or up to an early redemption date, the interest rate shall reset quarterly to an interest rate per annum equal to the then current three-month SOFR plus 513 basis points, payable quarterly in arrears. Beginning on September 30, 2025 through maturity, the Notes may be redeemed, at the Company’s option, on any scheduled interest payment date. The Notes will mature on September 30, 2030. The Purchase Agreement contains certain customary representations, warranties and covenants made by the Company, on the one hand, and the Purchasers, severally and not jointly, on the other hand.