SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM 10-QSB [X] QUARTERLY REPORT UNDER SECTION 13 AND 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended September 30, 2003 -------------------- [ ] TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE EXCHANGE ACT 1934 For the transition period from _______ to _______ Commission File Number: 000-25345 --------- COMMUNITY CAPITAL BANCSHARES, INC. (Exact name of registrant as specified in its charter) Georgia 58-2413468 ------------------------------------------------------------------ (State or other jurisdiction of (IRS Employer Incorporation or organization) Identification No.) P.O. Drawer 71269, Albany, Georgia 31708 ---------------------------------------- (Address of principal executive offices) (229) 446-2265 -------------- (Registrant's telephone number, including area code) Not Applicable -------------- (Former name, former address and former fiscal year, if changed since last report) Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes X No --- --- APPLICABLE ONLY TO CORPORATE ISSUERS: Indicate the number of shares outstanding of each of the issuer's classes of common stock as of November 12, 2003: 1,434,585 SHARES Transitional Small Business Disclosure Format (check one): Yes No X --- --- PART I - FINANCIAL INFORMATION Page No. -------- ITEM 1. Financial Statements Consolidated balance sheets (unaudited) as of December 31, 2002 and September 30, 2003 3 Consolidated statement of operations (unaudited) for the three and nine months ended September 30, 2002 and 2003 4 Consolidated statement of comprehensive income (unaudited) for the three and nine months ended Sept. 30, 2002 and 2003 5 Statement of cash flows (unaudited) for the nine months ended September 30, 2002 and 2003 6 Item 2. Management's Discussion and Analysis of Financial Condition and results of operations 10 Item 3. Controls and procedures 13 PART II - OTHER INFORMATION ITEM 1. Legal Proceedings 14 ITEM 2. Changes in Securities and use of proceeds 14 ITEM 3. Defaults on Senior Securities 14 ITEM 4. Submission of matters to a vote of Security Holders 14 ITEM 5. Other Information 14 ITEM 6. Exhibits and reports on Form 8-K 14 COMMUNITY CAPITAL BANCSHARES, INC. AND SUBSIDIARY CONSOLIDATED BALANCE SHEETS (UNAUDITED) (Dollars in thousands) September 30, 2003 December 31, 2002 -------------------- ------------------- ASSETS ------ Cash and due from banks $ 3,678 $ 6,920 Federal funds sold 533 0 Securities available for sale 28,212 16,968 Loans 94,549 81,713 Less allowance for loan losses 1,060 821 -------------------- ------------------- Loans, net 93,489 80,892 Premises and equipment 3,519 3,058 Other assets 2,042 1,348 -------------------- ------------------- TOTAL ASSETS $ 131,473 $ 109,186 ==================== =================== LIABILITIES AND SHAREHOLDERS' EQUITY ------------------------------------ Deposits Non-interest bearing $ 7,781 $ 6,731 Interest bearing 93,437 79,273 -------------------- ------------------- Total deposits 101,218 86,004 Other borrowings 19,610 12,590 Other liabilities 897 849 -------------------- ------------------- TOTAL LIABILITIES 121,725 99,443 -------------------- ------------------- Shareholders' equity Preferred stock, par value not stated; 2,000,000 shares authorized; no shares issued $ - - $ - - Common stock, $1.00 par value, 10,000,000 shares authorized; 1,499,560 shares issued 1,500 1,500 Capital surplus 8,084 8,084 Retained earnings 687 354 Accumulated other comprehensive income (46) 295 Less cost of treasury stock, 65,773 shares as of September 30, 2003 and 68,539 shares as of December 31, 2002 (477) (490) -------------------- ------------------- TOTAL SHAREHOLDERS' EQUITY 9,748 9,743 -------------------- ------------------- TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY $ 131,473 $ 109,186 ==================== =================== 3 COMMUNITY CAPITAL BANCSHARES, INC. CONSOLIDATED STATEMENTS OF INCOME FOR THE THREE AND NINE MONTHS ENDED SEPTEMBER 30, 2003 AND 2002 (UNAUDITED) (DOLLARS IN THOUSANDS, EXCEPT EARNINGS PER SHARE) Three months ended Nine months ended ------------------------------ ------------------------------ Sept 30, 2003 Sept 30, 2002 Sept 30, 2003 Sept 30, 2002 -------------- -------------- -------------- -------------- INTEREST INCOME Loans 1,519 1,406 4,558 4,025 Taxable securities 255 268 569 711 Tax exempt securities 13 10 35 24 Deposits in banks 6 8 19 11 Federal funds sold 4 10 24 38 -------------- -------------- -------------- -------------- TOTAL INTEREST INCOME 1,797 1,702 5,205 4,809 -------------- -------------- -------------- -------------- INTEREST EXPENSE Deposits 476 579 1,528 1,686 Other borrowed money 180 114 445 345 -------------- -------------- -------------- -------------- TOTAL INTEREST EXPENSE 656 693 1,973 2,031 -------------- -------------- -------------- -------------- NET INTEREST INCOME 1,141 1,009 3,232 2,778 Provision for loan losses 163 34 378 354 -------------- -------------- -------------- -------------- NET INTEREST INCOME AFTER PROVISION FOR LOAN LOSSES 978 975 2,854 2,424 -------------- -------------- -------------- -------------- OTHER INCOME Service charges on deposit accounts 138 98 381 269 Financial service fees 135 10 163 69 Mortgage origination fees 37 72 190 164 Gain on sale of investment securities 0 66 0 108 Other service charges, commissions and fees 3 15 59 35 -------------- -------------- -------------- -------------- TOTAL OTHER INCOME 313 261 793 645 -------------- -------------- -------------- -------------- OTHER EXPENSES Salaries and employee benefits 470 404 1,445 1,109 Equipment and occupancy expense 156 109 452 303 Marketing expense 22 40 72 111 Data processing expense 92 65 263 193 Administrative expenses 146 127 467 336 Other operating expenses 120 115 361 282 -------------- -------------- -------------- -------------- TOTAL OTHER EXPENSES 1,006 860 3,060 2,334 -------------- -------------- -------------- -------------- INCOME BEFORE INCOME TAXES 285 376 587 735 Income tax expense 93 128 195 254 -------------- -------------- -------------- -------------- NET INCOME 192 248 392 481 ============== ============== ============== ============== NET INCOME PER COMMON SHARE $ 0.13 $ 0.17 $ 0.27 $ 0.33 ============== ============== ============== ============== DILUTED NET INCOME PER COMMON SHARE $ 0.12 $ 0.17 $ 0.24 $ 0.32 ============== ============== ============== ============== WEIGHTED AVERAGE SHARES OUTSTANDING 1,433,116 1,437,488 1,432,225 1,442,092 DILUTED AVERAGE SHARES OUTSTANDING 1,665,413 1,478,407 1,648,937 1,483,011 ============== ============== ============== ============== 4 COMMUNITY CAPITAL BANCSHARES, INC. AND SUBSIDIARY CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (UNAUDITED) Three and nine months ended September 30, 2002 and 2003 (Dollars in thousands) Three Months Ended Nine Months Ended -------------------------------- -------------------------------- Sept 30, 2003 Sept 30, 2002 Sept 30, 2003 Sept 30, 2002 NET INCOME (LOSS) $ 192 $ 248 $ 392 $ 481 Other comprehensive Income Net unrealized holding gains (losses) arising during period (542) 345 (503) 454 Tax (expense) benefit on unrealized holding gains 184 (117) 162 (154) Reclassification adjustment for gains included in net income, net of income taxes of $27 for 3 months ended and $41 for 9 months ended September 30, 2002 (54) (82) =============== =============== =============== =============== COMPREHENSIVE INCOME $ (166) $ 422 $ 51 $ 699 =============== =============== =============== =============== 5 COMMUNITY CAPITAL BANCSHARES, INC. AND SUBSIDIARY CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED) Nine Months ended September 30, 2002 and 2003 (Dollars in thousands) 2003 2002 --------- --------- CASH FLOWS FROM OPERATING ACTIVITIES: Net income $ 392 $ 481 Adjustments to reconcile net income to net cash provided by (used in) operating activities: Depreciation 217 137 Provision for loan losses 378 354 Provision for deferred taxes 39 (36) Increase in interest receivable (215) 42 Net (gain) on sale of investments available for sale - - (108) Other operating activities (315) (311) --------- --------- Net cash provided by operating activities 496 559 --------- --------- CASH FLOWS FROM INVESTING ACTIVITIES: Purchase of property and equipment (678) (237) Net decrease (increase) in federal funds sold (533) 1,421 Net (increase) in loans (12,968) (13,009) Proceeds from maturities of securities available for sale 4,918 10,575 Proceeds from sale of securities available for sale - - 3,331 Purchase of securities available for sale (16,665) (17,126) --------- --------- Net cash used in Investing activities (25,926) (15,045) --------- --------- CASH FLOWS FROM FINANCING ACTIVITIES: Net increase in deposits 15,214 16,168 Proceeds from Other Borrowings 5,000 - - Proceeds from Trust Preferred Issuance 4,000 - - Dividends paid to shareholders by parent (59) - - Increase (decrease) in Fed Funds purchased (1,705) - - Repayment of Other Borrowings (275) (275) Treasury stock transactions, net 13 (118) --------- --------- Net cash provided by financing activities 22,188 15,775 --------- --------- Net increase (decrease) in cash (3,242) 1,289 Cash and due from banks at beginning of period 6,920 4,471 --------- --------- Cash and due from banks at end of period $ 3,678 $ 5,760 ========= ========= SUPPLEMENTAL DISCLOSURE Cash paid for interest $ 1,963 $ 1,994 ========= ========= Cash paid for income taxes $ 397 $ 53 ========= ========= NON-CASH TRANSACTION Unrealized gains (losses) on securities available for sale $ (503) $ 221 ========= ========= 6 COMMUNITY CAPITAL BANCSHARES, INC. AND SUBSIDIARY NOTES TO FINANCIAL STATEMENTS NOTE 1. ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES NATURE OF BUSINESS Community Capital Bancshares, Inc. (the "Company") is a bank holding company whose business is conducted by its wholly-owned subsidiary, Albany Bank & Trust, (the "Bank"). The Bank is a commercial bank located in Albany, Georgia. The Bank provides a full range of banking services in its primary market area of Dougherty County and the surrounding counties. The Bank commenced its banking operations on April 28, 1999. BASIS OF PRESENTATION The consolidated financial statements include the accounts of the Company and its subsidiary. Significant intercompany transactions and accounts are eliminated in consolidation. The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosures of contingent assets and liabilities as of the balance sheet date and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. Material estimates that are particularly susceptible to significant change in the near term relate to the determination of the allowance for loan losses, the valuation of foreclosed real estate and deferred taxes. The interim financial statements included herein are unaudited but reflect all adjustments which, in the opinion of management, are necessary for a fair presentation of the financial position and results of operations for the interim period presented. All such adjustments are of a normal recurring nature. The results of operations for the period ended September 30, 2003 are not necessarily indicative of the results of a full year's operations, and should be read in conjunction with the Company's annual report as filed on Form 10-KSB. The accounting principles followed by the Company and the methods of applying these principles conform with accounting principles generally accepted in the United States of America (GAAP) and with general practices within the banking industry. INCOME TAXES Deferred income tax assets and liabilities are determined using the balance sheet method. Under this method, the net deferred tax asset or liability is determined based on the tax effects of the temporary differences between the book and tax basis of the various balance sheet assets and liabilities and gives current recognition to changes in the tax rates and laws. The Company and the Bank file a consolidated income tax return. Each entity provides for income taxes based on its contribution to the income taxes (benefits) of the consolidated group. 7 STOCK COMPENSATION PLANS At September 30, 2003, the Company had two stock-based employee compensation plans, which are described in more detail in the 2002 annual report. The Company accounts for those plans under the recognition and measurement principles of Accounting Principles Board (APB) Opinion No. 25, Accounting for Stock Issued to Employees, and related Interpretations. No stock-based employee compensation cost is reflected in net income, as all options granted under those plans had an exercise price equal to the market value of the underlying stock on the date of grant. In addition, the FASB issued SFAS No. 148, Accounting for Stock-Based Compensation - Transition and Disclosure in December 2002. SFAS No. 148 amends SFAS No. 123, Accounting for Stock-Based Compensation, to provide alternative methods of transition for an entity that voluntarily changes to the fair value based method of accounting for stock-based employee compensation. It also amends the disclosure provisions of SFAS No. 123 to require prominent disclosure about the effects on reported net income of an entity's accounting policy decisions with respect to stock-based employee compensation. The Company has not elected to adopt the recognition provisions of this Statement for stock-based employee compensation and has elected to continue with accounting methodology in Opinion No. 25 as permitted by SFAS No. 123. Three months ended Nine months ended -------------------- -------------------- September 30, September 30, -------------------- -------------------- 2003 2002 2003 2002 --------- --------- --------- --------- Net Income, as reported $192,000 $248,000 $392,000 $481,000 Deduct: Total stock- based employee compensation expense determined under fair value based method for all awards, net of related tax effects (23,000) (25,000) (86,000) (75,000) --------- --------- --------- --------- Pro forma net income $169,000 $223,000 $306,000 $406,000 ========= ========= ========= ========= Earnings per share: Basic - as reported $ 0.13 $ 0.17 $ 0.27 $ 0.33 ========= ========= ========= ========= Basic - pro forma $ 0.12 $ 0.16 $ 0.21 $ 0.28 ========= ========= ========= ========= Diluted - as reported $ 0.12 $ 0.17 $ 0.24 $ 0.32 ========= ========= ========= ========= Diluted - pro forma $ 0.10 $ 0.15 $ 0.19 $ 0.27 ========= ========= ========= ========= ACCOUNTING STANDARDS In November 2002, the Financial Accounting Standards Board issued FASB Interpretation No. 45 ("FIN 45"), "Guarantor's Accounting and Disclosure Requirements for Guarantees, Including Indirect Guarantees of Indebtedness of Others, an interpretation of FASB Statements No. 5, 57, and 107 and rescission of FASB Interpretation No. 34". FIN 45 elaborates on the disclosures to be made by a guarantor in its interim and annual financial statements about its obligations under certain guarantees that it has issued. The disclosures required by FIN 45 improve the transparency of the financial statement information about the guarantor's obligations and liquidity risks related to guarantees issued. This interpretation also incorporates, without change, the guidance in Financial Accounting Standards Board Interpretation No. 34 ("FIN 34"), "Disclosure of Indirect Guarantees of Indebtedness of Others", which is being superceded. FIN 45 also clarifies that a guarantor is required to recognize, at the inception of a guarantee, a liability for the obligations it has undertaken in issuing the guarantee, including its ongoing obligation to stand ready to perform over the term of the guarantee in the event that the 8 specified triggering events or conditions occur. The initial recognition and initial measurement provisions of FIN 45 are applicable on a prospective basis to guarantees issued or modified after December 31, 2002, irrespective of the guarantor's fiscal year-end. The disclosure requirements are effective for Financial statements of interim or annual periods ending after December 15, 2002. The adoption of FIN 45 did not have a material impact on the Company's consolidated financial statements. In May 2003, the Financial Accounting Standards Board issued Statement No. 150 ("Statement 150"), "Accounting for Certain Financial Instruments with Characteristics of Both Liabilities and Equity". Statement 150 requires certain financial instruments that have characteristics of both liabilities and equity to be classified as a liability on the balance sheet. Prior to the issuance of Statement 150, the Company classified trust preferred securities as a liability on the consolidated balance sheet and its related interest cost as interest expense on the consolidated statement of income, which is consistent with the requirements of Statement 150. Statement 150 is effective for financial instruments entered into or modified after May 31, 2003, and otherwise is effective at the beginning of the first interim period beginning after June 15, 2003. Statement 150 will be effected by reporting the cumulative effect of a change in accounting principle for contracts created before the issuance date and still existing at the beginning of that interim period. The adoption of Statement 150 did not have an impact on the Company's consolidated financial statements. NOTE 2. PENDING ACQUISITION On July 2, 2003, the Company agreed to acquire First Bank of Dothan for cash and stock totaling $4,680,000 subject to stockholder and regulatory approvals. A total of $1,750,000 is to be paid in cash. All appropriate approvals were obtained in October, 2003 and the transaction is expected to be consummated in November 2003. 9 MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS This discussion is intended to assist in an understanding of the Company's financial condition and results of operations. This analysis should be read in conjunction with the financial statements and related notes appearing in Item 1 of the September 30, 2003 Form 10-QSB and Management's Discussion and Analysis of Financial Condition and Results of Operations appearing in the Company's Form 10-KSB for the year ended December 31, 2002. FINANCIAL CONDITION As of September 30, 2003 the Company's total assets were $131,474,000 representing an increase of $22,288,000 or 20.41% from December 31, 2002. Earning assets consist of Federal funds sold, investment securities and loans. These assets provide the majority of the Company's earnings. The mix of earning assets is a reflection of management's philosophy regarding earnings versus risk. Federal funds sold represent an overnight investment of funds and can be converted immediately to cash. At September 30, 2003, federal funds sold were $533,000. At December 31, 2002, the Company had no federal funds sold. Investment securities consist of U.S. Government and Agency securities and municipal bonds. These investments are used to provide fixed maturities and as collateral for advances and large public fund deposits. During the third quarter, investment securities increased $8,950,000. All securities are classified as available for sale, and are carried at current market values. The loan portfolio is the largest earning asset and is the primary source of earnings for the Company. At September 30, 2003 net loans were $93,490,000. The loan portfolio increased $12,599,000 or 15.56% over the year-end amount. At September 30, 2003, the allowance for loan losses was $1,060,000 or 1.12% of total loans. Management believes this is an adequate but not excessive amount based upon the composition of the current loan portfolio and current economic conditions. The relationship of the allowance to total loans will vary over time based upon Management's evaluation of the loan portfolio. Management evaluates the adequacy of the allowance on a monthly basis and adjusts it accordingly by a monthly charge to earnings using the provision for loan losses. During the first three quarters of 2003, the provision for potential loan losses was $378,000 as compared to the 2002 amount of $354,000. Non-earning assets consist of premises and equipment, and other assets. Premises and equipment decreased during the quarter as a result of depreciation expense on these assets. Other assets consist primarily of accrued interest receivable, income tax receivable and prepaid assets. Other assets increased $357,000 during the third quarter as a result of the larger loan portfolio upon which to accrue interest and an increase in income taxes receivable and an increase in prepaid assets. The Company funds its assets primarily through deposits from customers. Additionally, it borrows funds from other sources to provide longer term fixed rate funding for its assets. The Company must pay interest on the majority of these funds and attempts to price these funds competitively in the market place but at a level that it can safely re-invest the funds profitably. At September 30, 2003, total deposits were $101,218,000 as compared to the year-end amount of $86,004,000. This is an increase of $15,214,000 or 17.69%. 10 Interest bearing deposits are comprised of the following categories: Sept 30, 2003 December 31, 2002 -------------- ------------------ Interest bearing demand and savings $ 27,743,000 $ 23,735,000 Certificates of deposit in denominations of $100,000 or greater 20,542,000 16,413,000 Other Certificates of deposit 45,152,000 39,125,000 -------------- ------------------ Total $ 93,437,000 $ 79,273,000 ============== ================== Other borrowings consist of Federal Home Loan Bank advances and are secured by investment securities and loans of the Company. A $5,000,000 advance was obtained from the Federal Home Loan Bank during the current quarter. CAPITAL ADEQUACY The following table presents the Company's regulatory capital position as of September 30, 2003. Tier 1 Capital Ratio, actual 13.90% Tier 1 Capital minimum requirement 4.00% Tier 2 Capital Ratio, actual 15.85% Tier 2 Capital minimum requirement 8.00% Leverage Ratio 10.08% Leverage Ratio minimum requirement 4.00% The Company's ratios are well above the required regulatory minimums and provide a sufficient basis to support future growth of the Company. ACQUISITION AND LIQUIDITY On July 2, 2003, the Company signed an agreement to acquire First Bank of Dothan ("Dothan"). This agreement was approved by the stockholders of Dothan and regulatory agencies in October 2003 and closing is anticipated in November 2003. At September 30, 2003 Dothan had total assets of $26,600,000 and capital of $2,780,000. The acquisition will require $1,760,000 in cash and the Company will finance this amount to be repaid over ten years. This acquisition is expected to have a positive effect on earnings and the financial condition of the Company. RESULTS OF OPERATIONS Net income for the nine months ended September 30, 2003 is $392,000 as compared to $481,000 for the same period in 2002. Although net interest income increased by $454,000 or 16.34% in 2003 as compared to the first nine months of 2002, net non-interest expense increased $578,000 or 34.22% in 2003 as compared to the first nine months of 2002. Total interest income increased $396,000 for the nine months ended September 30 2003 or 8.24% from the same period in the previous year. This was the result of increased interest income on loans, which increased $533,000, combined with a decrease in investment income of $142,000 or 17.80% from the same period last year. The increase in interest income was the direct result of the larger loan portfolio in the current year. This increase was in spite of the declining interest rate levels during the year. 11 Interest expense for the nine months ended September 30, 2003 is $1,973,000. This is the major expense item for the Company and decreased $58,000 from the previous year. This decrease is the direct result of the overall lower interest rate environment for the period. The Company has been able to reprice its increased level of deposits in the current year at a lower interest rate than the previous year. Net interest income after the provision for loan losses is $2,854,000 for the nine months ended September 30, 2003 as compared to the 2002 amount of $2,424,000. This is an increase of $430,000 or 17.74%. This increase is the combined result of the increased level of earning assets, and the lower cost of funds during the current year. The overall growth rate has declined from previous years. Management is currently emphasizing a better interest margin as opposed to the higher growth rate emphasis in previous years. Other income increased $148,000 over the prior year to $793,000 for the nine months ended September 30, 2003. Service charges on deposit accounts increased $112,000 or 41.64% due to the larger number of deposit accounts. Mortgage origination fees increased $26,000 as compared the same period in the previous year. These fees are generated by facilitating mortgage loans for customers, which are sold in the secondary market. The low interest rate levels led to increases in this area of activity in the Bank. Non-interest expense increased $726,000 to $3,060,000 for the nine months ended September 30, 2003. This is an increase of 31.10%. The largest area of increase was in the salary and employee benefits category. This expense item is $1,445,000 for the nine months ended September 30, 2003 as compared to $1,109,000 for the same period in the previous year. This is an increase of $336,000 or 30.30%. The growth in this expense item is due to the increased staffing required to properly serve the Company's customers and slightly higher levels of pay during the current year. Equipment and Occupancy expenses increased $149,000 or 49.17% for the nine months ended September 30, 2003 as compared to the same period in the previous year. This is a result of the rent of office space for the Lee County Branch, East Albany Branch and Operations Center, coupled with increased depreciation on the furniture and equipment. These three facilities were opened during 2002 and only a partial year of expense was realized. Data processing expenses increased $70,000 or 36.30% for the nine months ended September 30, 2003 as compared to the same period in the previous year. This is the result of the larger size of the Company. Administrative expenses increased $131,000 or 38.99% over the previous year of which Audit fees accounted for 53,000 of the increase. Other expenses increased $79,000 to $361,000 in the current year. The majority of this increase is the result of staff development and other operating losses, increasing $24,000 and $23,000 respectively over the previous year. Diluted earnings per share for the current year are $0.24 and decreased $0.08 or 25% from the previous year. FORWARD-LOOKING STATEMENTS This document contains statements that constitute "forward-looking statements" within the meaning of Sections 27A of the Securities Act of 1933, as amended, and Sections 21E of the Securities Exchange Act of 1934, as amended. The words "believe", "estimate", "expect", "intend", "anticipate" and similar expressions and variations thereof identify certain of such forward-looking statements, 12 which speak only as of the dates that they were made. The Company undertakes no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events, or otherwise. Users are cautioned that any such forward-looking statements are not guarantees of future performance and involve risks and uncertainties that the actual results may differ materially from those indicated in the forward-looking statements as a result of various factors. Users are therefore cautioned not to place undue reliance on these forward-looking statements. ITEM 3. CONTROLS AND PROCEDURES As of September 30, 2003, the Company carried out an evaluation, under the supervision and with the participation of the Company's management, including the Company's Chief Executive Officer and Chief Financial Officer, of the effectiveness of the design and operation of the Company's disclosure controls and procedures pursuant to Exchange Act Rule 13a-15(b). Based upon that evaluation, the Company's Chief Executive Officer and Chief Financial Officer concluded that the Company's disclosure controls and procedures are effective in timely alerting them to material information relating to the Company (including its consolidated subsidiaries) that is required to be included in the Company's periodic filings with the Securities and Exchange Commission. There have been no changes in the Company's internal control over financial reporting during the quarter ended September 30, 2003 that have materially affected, or are reasonably likely to materially affect, the Company's internal control over financial reporting. 13 PART II ITEM 1. LEGAL PROCEEDINGS None ITEM 2. CHANGES IN SECURITIES AND USE OF PROCEEDS (a) None (b) None (c) None ITEM 3. DEFAULTS ON SENIOR SECURITIES None ITEM 4. OTHER INFORMATION None ITEM 5. EXHIBITS AND REPORTS ON FORM 8-K (a) REPORTS ON FORM 8-K (1) Form 8-K filed on July 28, 2003 regarding second quarter earnings. (B) EXHIBITS 31.1 Certification of the Chief Executive officer pursuant to Rule 13a-14(a) under the Securities exchange act of 1934, as amended. 31.2 Certification of the Chief Financial Officer pursuant to Rule 13a-14(a) under the Securities exchange act of 1934, as amended. 32 Certification of the CEO and CFO pursuant to Rule 13a-14(b) under the Securities exchange act of 1934, as amended. 14 SIGNATURES Pursuant to the requirements of the Securities and Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized. COMMUNITY CAPITAL BANCSHARES, INC. November 13, 2003 /s/ Robert E. Lee ------------------- -------------------------- Date Robert E. Lee, President November 13, 2003 /s/ David J. Baranko ------------------- -------------------------- Date David J. Baranko Chief Financial Officer (Duly authorized officer and principal financial / accounting officer) 15