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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
 Washington, D.C. 20549
 
 FORM 10-QSB
 þ
    
    QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
 For the Quarter Ended June 30, 2005
 OR
 o
    
    TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
 For the Transition Period from  to
 Commission File No. 333-123386
 NORTHSIDE BANCSHARES, INC.
  Georgia
(State of Incorporation)
    
    31-1840578
(I.R.S. Employer Identification Number)
 
 
 
 
 þ o
  o þ




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NORTHSIDE BANCSHARES, INC.
 INDEX
  
 Page No.PART I
    
    FINANCIAL INFORMATIONItem 1.
    
    Financial StatementsBalance Sheet (unaudited) as of June 30, 2005
    
    
    3Statements of
Operations For the Three and Six Months Ended June 30, 2005 and the
Period from August 3, 2004 (inception) to June 30, 2005 (unaudited)
    
    
    4Statements of Cash
Flows For the Six Months Ended June 30, 2005 and the Period from
August 3, 2004 (inception) to June 30, 2005 (unaudited)
    
    
    5Notes to Financial Statements (unaudited)
    
    
    6Item 2.
    
    Managements Plan of Operations
    
    
    8Item 3.
    
    Controls and Procedures
    
    
    10PART II.
    
    OTHER INFORMATIONItem 1.
    
    Legal Proceedings
    
    
    11Item 2.
    
    Unregistered Sales of Equity Securities and Use of Proceeds
    
    
    11Item 3.
    
    Defaults Upon Senior Securities
    
    
    11Item 4.
    
    Submission of Matters to a Vote of Security Holders
    
    
    11Item 5.
    
    Other Information
    
    
    11Item 6.
    
    Exhibits
    
    
    11EX-31.1 CERTIFICATION OF CHIEF EXECUTIVE OFFICEREX-31.2 CERTIFICATION OF CHIEF FINANCIAL OFFICEREX-32.1 SECTION 1350 CERTIFICATIONS
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NORTHSIDE BANCSHARES, INC.
 
 PART I
FINANCIAL INFORMATION
 
 Item 1. Financial Statements
 NORTHSIDE BANCSHARES, INC.
(A Development Stage Corporation)
 
 Balance Sheet
 (unaudited)
 June 30, 2005
 AssetsCash
    
    $
    67,543Restricted Cash
    
    
    10,209,751Deferred offering expenses
    
    
    41,247Equipment
    
    
    14,540Other assets
    
    
    92,006$
    10,425,087Liabilities and Stockholders DeficitAccounts payable and accrued expenses
    
    $
    13,246Subscribers deposits
    
    
    10,192,730Deferred revenue
    
    
    17,021Line of credit
    
    
    655,927Total liabilities
    
    
    10,878,924Stockholders deficit:Preferred stock, no par value, 10,000,000 shares authorized
and no shares issued and outstanding
    
    
    Common stock, $1 par value; 10,000,000 shares authorized
10 shares issued and outstanding
    
    
    10Common stock subscription receivable
    
    
    (100
    )Additional paid-in capital
    
    
    90Deficit accumulated during the development stage
    
    
    (453,837
    )Total stockholders deficit
    
    
    (453,837
    )$
    10,425,087
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NORTHSIDE BANCSHARES, INC.
 (A Development Stage Corporation)
 
 Statements of Operations
 (unaudited)
 For the Three and Six Months Ended June 30, 2005
and the Period from August 3, 2004 (inception) to June 30, 2005
 Three Months Ended
    
    Six Months Ended
    
    Cumulative ThroughJune 30, 2005
    
    June 30, 2005
    
    June 30, 2005Expenses:Legal and consulting
    
    $
    55,702
    
    
    
    67,552
    
    
    
    117,552Salaries and benefits
    
    
    94,154
    
    
    
    166,723
    
    
    
    190,987Facilities Expenses
    
    
    55,885
    
    
    
    55,885
    
    
    
    55,885Filing fees
    
    
    360
    
    
    
    360
    
    
    
    20,460Other operating
    
    
    27,608
    
    
    
    44,859
    
    
    
    68,952Net loss
    
    $
    (233,709
    )
    
    
    (335,379
    )
    
    
    (453,837
    )
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NORTHSIDE BANCSHARES, INC.
 (A Development Stage Corporation)
 
 Statements of Cash Flows
 (unaudited)
 For the Six Months Ended June 30, 2005
and the Period from August 3, 2004 (inception) to June 30, 2005
 Six Months
    
    CumulativeEnded
    
    ThroughJune 30, 2005
    
    June 30, 2005Cash flows from operating activities:Net loss
    
    $
    (335,379
    )
    
    
    (453,837
    )Adjustments to reconcile net loss to net cash used by operating activities:Change in other assets
    
    
    (92,006
    )
    
    
    (92,006
    )Change in accounts payable and accrued expenses
    
    
    (5,483
    )
    
    
    13,246Net cash used by operating activities
    
    
    (432,868
    )
    
    
    (532,597
    )Cash flows from investing activities consisting of purchases of equipment
    
    
    (14,540
    )
    
    
    (14,540
    )Cash flows from financing activities:Proceeds from line of credit
    
    
    555,283
    
    
    
    655,927Deferred offering expenses
    
    
    (41,247
    )
    
    
    (41,247
    )Net cash provided by financing activities
    
    
    514,036
    
    
    
    614,680Net change in cash and cash equivalents
    
    
    66,628
    
    
    
    67,543Cash and cash equivalents at beginning of period
    
    
    915
    
    
    
    Cash and cash equivalents at end of period
    
    $
    67,543
    
    
    
    67,543Supplemental disclosure of cash paid for interest
    
    $
    6,163
    
    
    
    6,972Supplemental disclosure of non-cash financing activities:Increase in subscribers deposits
    
    $
    10,192,730
    
    
    
    10,192,730Increase in deferred revenue
    
    $
    17,021
    
    
    
    17,021
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NORTHSIDE BANCSHARES, INC.
 (A Development Stage Corporation)
 
 Notes to Financial Statements
 (1)
    
    OrganizationNorthside Bancshares, Inc., (the Company) was incorporated for the purpose of becoming a
bank holding company. The Company intends to acquire 100% of the outstanding common stock of
Northside Bank (in Organization) (the Bank), which will operate in Adairsville, Bartow
County, Georgia. The organizers of the Bank filed an application to charter the Bank with the
Georgia Department of Banking and Finance on December 23, 2004 and an application for deposit
insurance for the Bank with the Federal Deposit Insurance Corporation. In addition, the
Company has filed an application to serve as the holding company for the Bank with the board
of Governors for the Federal Reserve System. Provided that the application is timely approved
and necessary capital is raised, it is expected that operations will commence in the third
quarter of 2005.The Company was incorporated on January 6, 2005 and organizing activities and expenditures
associated with organization commenced August 3, 2004. The accompanying financial statements
reflect all transactions from August 3, 2004 through June 30, 2005. Operations through June 30,
2005 relate primarily to expenditures by the Company and the organizers for incorporating and
organizing the Company. All expenditures by the organizers and the Company are considered
expenditures of the Bank.The Company plans to raise between $10,600,000 and $15,000,000 through an offering of its
common stock at $10 per share. The organizers and directors expect to subscribe for a minimum
of approximately $3,600,000 (360,000 shares) of the Companys stock.In connection with the Companys formation and initial offering, warrants to purchase shares
of common stock at $10.00 per share will be issued to the organizers. The organizers will
receive warrants to purchase one share of common stock for each share they purchase. The
warrants expire ten years after the date of grant. The Company also intends to reserve
225,000 shares of its common stock for issuance under a stock option plan.
 (2)
    
    Summary of Significant Accounting PoliciesOrganization CostsCosts incurred for the organization of the Company and the Bank (consisting principally of
legal, accounting, consulting and incorporation fees) are being expensed as incurred.Deferred Offering ExpensesCosts incurred in connection with the stock offering, consisting of direct, incremental costs
of the offering, are being deferred and will be offset against the proceeds of the stock sale
as a charge to additional paid in capital.Pre-Opening ExpensesCosts incurred for overhead and other operating expenses are included in the current
periods operating results.
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Item 2. Managements Plan of Operation
  General
  
    
    seeking, interviewing and selecting our officers;
    
    preparing our business plan;
    
    applying for a state bank charter under the laws of the State of Georgia;
    
    applying for FDIC deposit insurance;
    
    preparation of the sites for our banking facility in Adairsville, Georgia and selection of the site for
our branch office in Cartersville, Georgia; and
    
    raising equity capital through an initial public offering.
  Financial Results
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Item 2. Managements Plan of Operations, continued
 Liquidity and Interest Rate Sensitivity
 Organizational Period.
 The Wall Street Journal
   Commencement of Banking Operations.
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Item 2. Managements Plan of Operations, continued
 Commencement of Banking Operations, continued.
  Permanent Office Facility .
  Capital Adequacy
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Item 3. Controls and Procedures
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PART
II
 OTHER INFORMATION
 
 Item 1. Legal Proceedings
  
 Item 2. Unregistered Sales of Equity Securities and Use of Proceeds
  
 Item 3. Defaults Upon Senior Securities
  
 Item 4. Submission of Matters to a Vote of Security Holders
  
 Item 5. Other Information
  
 Item 6. Exhibits
 31.1
    
    Rule 13a-14(a) Certification of Chief Executive Officer31.2
    
    Rule 13a-14(a) Certification of Chief Financial Officer32.1
    
    Section 1350 Certifications
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SIGNATURES
  NORTHISDE BANCSHARES, INC.August 10, 2005
    
    /s/Gregory F. PattonGregory F. Patton
President and Chief Executive Officer
 August 10, 2005
    
    /s/Barry AdcockBarry AdcockChief Financial Officer
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EXHIBIT INDEX
 Exhibit Number
    
    Description31.1
    
    Rule 13a-14(a) Certification of Chief Executive Officer31.2
    
    Rule 13a-14(a) Certification of Chief Financial Officer32.1
    
    Section 1350 Certifications
 13