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The following is an excerpt from a 10-K SEC Filing, filed by PINNACLE HOLDINGS INC on 4/16/2002.
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PINNACLE HOLDINGS INC - 10-K - 20020416 - COMPENSATION

ITEM 11. EXECUTIVE COMPENSATION

Under rules established by the SEC, Pinnacle is required to provide certain information concerning total compensation earned or paid to: (1) the Chief Executive Officer of Pinnacle and (2) the four other most highly compensated executive officers whose annual salaries and bonuses exceeded $100,000 during fiscal 2001. Such information is also provided for two former executive officers who would have been two of the four most highly compensated executive officers during fiscal 2001 had they stayed through the end of the fiscal year (such six individuals, the "Named Executive Officers").

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SUMMARY COMPENSATION TABLE

The following table sets forth certain compensation information for the Named Executive Officers.

                                          ANNUAL COMPENSATION                       LONG-TERM COMPENSATION
                              ----------------------------------------------  ------------------------------------
                                                                    OTHER
                                                                    ANNUAL    RESTRICTED  SECURITIES
NAME AND PRINCIPAL                                                  COMPEN-     STOCK     UNDERLYING      LTIP         ALL OTHER
POSITION                       YEAR      SALARY($)    BONUS($)     SATION($)   AWARDS($)   OPTIONS(#)   PAYOUTS($)  COMPENSATION ($)
------------------            -----     ----------   ---------    ----------  ----------  -----------  -----------  ----------------
Steven R. Day ..........       2001       291,833      175,000          --           --    1,500,000           -             --
Director, and Chief            2000       226,250      125,000          --           --      400,000           -             --
Executive Officer              1999       189,449       75,000          --           --      325,000           -             --

Ben Gaboury ............       2001       180,000           --          --           --       70,000           -             --
President of                   2000       180,000       50,000          --           --       50,000           -             --
Pinnacle Towers Inc.           1999       168,487       75,000          --           --      453,350           -             --

Decker  A. Todd ........       2001       112,167       35,350          --           --       60,000           -             --
Vice President and             2000       110,000           --          --           --       30,000           -             --
Assistant Secretary            1999        93,594        7,770          --           --       87,058           -             --

Michael D. Kerwick .....       2001       118,829       29,013          --           --       25,000           -             --
Vice President of              2000       110,944       56,719          --           --       21,000           -             --
Sales                          1999        35,933           --          --           --        3,000           -             --

Ronald Lipham ..........       2001       107,895       22,468          --           --       25,000           -             --
Vice President of              2000        99,775       37,569          --           --       13,500           -             --
Sales                          1999        32,500           --          --           --        3,000           -             --


Robert J. Wolsey (2) ...       2001       207,667      175,000          --           --           --           -             --
                               2000       337,500      170,000          --           --      400,000           -             --
                               0666       284,124      100,000          --           --      692,525           -             --

Jeffrey J. Card (3) ....       2001       216,650       60,000          --           --           --           -             --
                               2000        91,667       30,000          --           --      450,000           -             --
                               1999            --           --          --           --           --           -             --


(1) See also, "Employment Agreements."
(2) Mr. Wolsey resigned effective October 15, 2001.
(3) Mr. Card resigned effective March 14, 2001.

OPTION GRANTS IN 2001

The following table sets forth information as to stock options granted to all Named

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Executive Officers during fiscal 2001. These options were granted under our Stock Incentive Plan and, unless otherwise indicated, provide for vesting as to 20% of the underlying common stock one year after the date of grant, then 20% each year thereafter. Options were granted at an exercise price equal to the fair market value of our common stock on the date of grant except for 900,000 shares granted to Mr. Day on October 19, 2001 which were granted with exercise prices in excess of the market price. The amounts under "Potential Realizable Value at Assumed Annual Rate of Stock Appreciation for Option Term" represent the hypothetical gains of the options granted based on assumed annual compound stock appreciation rates of 5% and 10% over their fair market value at the date of grant for the full ten-year term of the options. The assumed rates of appreciation are mandated by the rules of the SEC and do not represent our estimate or projection of future common stock prices.

                       Individual Grants
                       -----------------
                                                                                                        Potential
                                                                                                        Realizable
                                                                                                     Value at Assumed
                                                                                                     Annual Rates of
                                              Percent of                                                 Stock
                           Number of             Total                                                   Price
                           Securities           Options                                              Appreciation for
                           Underlying         Granted to        Exercise of                             Option Term
                            Options          Employees in       Basic Price      Expiration      ----------------------
        Name               Granted(#)            2001             ($/SH)            Date          5%($)         10%($)
        ----              -----------        ------------       -----------      ----------      --------      --------
Steven R. Day .....        600,000                23.1%         $   0.46          10/15/11       $173,575      $439,873
                           300,000                11.6%             1.00          10/19/11             --        57,936
                           300,000                11.6%             2.00          10/19/11             --            --
                           300,000                11.6%             3.00          10/19/11             --            --

Ben Gaboury .......         70,000                 2.7%             4.05           7/30/11        178,292       451,826

Decker A. Todd ....         60,000                 2.3%             4.05           7/30/11        152,821       387,279

Michael D. Kerwick          25,000                 1.0%             4.05           7/30/11         63,676       161,366

Ronald Lipham .....         25,000                 1.0%             4.05           7/30/11         63,676       161,366

Robert J. Wosley (1)            --                  --                --                --             --            --

Jeffrey J. Card (2)             --                  --                --                --             --            --


(1) Mr. Wolsey resigned effective October 15, 2001 and pursuant to Pinnacle's option plan, such options are forfeited.
(2) Mr. Card resigned effective March 14, 2001 and pursuant to Pinnacle's option plan, such options are forfeited.

AGGREGATED OPTION EXERCISES IN LAST FISCAL YEAR AND FISCAL YEAR-END OPTION VALUES

No stock options granted under our Stock Incentive Plan were exercised during fiscal 2001. The values at fiscal year-end of unexercised in-the-money options granted to the Named Executed Officers are as set forth in the table below:

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                                       Number of Securities Underlying              Value of Unexercised In-The-
                                          Unexercised Options at                          Money Options at
                                            December 31, 2001($)                         December 31, 2001($)
Name                                  Exercisable         Unexercisable            Exercisable          Unexercisable
----                                  -----------         -------------            -----------          -------------
Steven R. Day ...........               202,858             2,015,000                    --                    --
Ben Gaboury .............               184,198               382,010                    --                    --
Decker A. Todd ..........                33,682               143,377                    --                    --
Michael D. Kerwick ......                 5,400                43,600                    --                    --
Ronald Lipham ...........                 3,900                37,600                    --                    --
Robert J. Wolsey (1) ....                    --                    --                    --                    --
Jeffrey J. Card (2) .....                    --                    --                    --                    --

(1) Mr. Wolsey resigned effective October 15, 2001 and pursuant to Pinnacle's option plan, such options are forfeited.

(2) Mr. Card resigned effective March 14, 2001 and pursuant to Pinnacle's option plan, such options are forfeited.

EMPLOYMENT AGREEMENTS AND TERMINATION AGREEMENTS

Pinnacle has entered into an employment agreement (the "Employment Agreement") with Mr. Day. The Employment Agreement provides that Mr. Day will be employed by Pinnacle until his resignation, death or disability or other incapacity, or until terminated by Pinnacle. Under the Employment Agreement, Mr. Day will receive, among other things, (1) an annual base salary and (2) other benefits as described in the Employment Agreement (including all employee benefit plans and arrangements that are generally available to other employees). The Employment Agreement includes noncompetition and nonsolicitation provisions restricting Mr. Day's ability to engage in activities competitive with Pinnacle for a period of two years following termination of employment. In the event of the termination of Mr. Day, the Employment Agreement provides for severance benefits including salary and health plan benefits for a period of six months.

SEVERANCE AGREEMENTS

Day Severance Agreement

Pinnacle has entered into a severance compensation agreement with Mr. Day. If Pinnacle terminates Mr. Day's employment without cause, or if Mr. Day resigns for good reason, within 24 months after the completion of a restructuring, recapitalization or reorganization of Pinnacle, Mr. Day will be entitled to receive four semi-annual cash installment payments equal in the aggregate to 200 percent of his annual base salary in effect on the date his employment terminates. If, prior to the payment of all installment payments, Mr. Day obtains other employment with a salary equal to or greater than his base salary, he will not receive the remaining installment payments. If, prior to the payment of all installments, Mr. Day obtains other employment with a salary that is less than his base salary but not less than 75 percent of his base salary, each remaining installment payment will be proportionately reduced. In addition, Pinnacle will continue to pay a portion of Mr. Day's group health insurance premiums for up to 18 months and will provide an automobile for Mr. Day for 24 months.

Gaboury Severance Agreement

Pinnacle has entered into a severance compensation agreement with Mr. Gaboury. If

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Pinnacle terminates Mr. Gaboury's employment without cause, or if Mr. Gaboury resigns for good reason, within 12 months after the completion of a restructuring, recapitalization or reorganization of Pinnacle, Mr. Gaboury will be entitled to receive two semi-annual cash installment payments equal in the aggregate to 100 percent of his annual base salary in effect on the date his employment terminates. If, prior to the payment of all installment payments, Mr. Gaboury obtains other employment with a salary equal to or greater than his base salary, he will not receive the remaining installment payments. If, prior to the payment of all installments, Mr. Gaboury obtains other employment with a salary that is less than his base salary but not less than 75 percent of his base salary, each remaining installment payment will be proportionately reduced. In addition, Pinnacle will continue to pay a portion of Mr. Gaboury's group health insurance premiums for up to 18 months. Mr. Gaboury's severance compensation agreement includes noncompetition, nonsolicitation and confidentiality provisions restricting Mr. Gaboury's ability to engage in activities competitive with Pinnacle for a period of 12 months following termination of employment.

Todd Severance Agreement

Pinnacle has entered into a severance compensation agreement with Mr. Todd. If Pinnacle terminates Mr. Todd's employment without cause, or if Mr. Todd resigns for good reason, within 12 months after the completion of a restructuring, recapitalization or reorganization of Pinnacle, Mr. Todd will be entitled to receive two semi-annual cash installment payments equal in the aggregate to 100 percent of his annual base salary in effect on the date his employment terminates. If, prior to the payment of all installment payments, Mr. Todd obtains other employment with a salary equal to or greater than his base salary, he will not receive the remaining installment payments. If, prior to the payment of all installments, Mr. Todd obtains other employment with a salary that is less than his base salary but not less than 75 percent of his base salary, each remaining installment payment will be proportionately reduced. In addition, Pinnacle will continue to pay a portion of Mr. Todd's group health insurance premiums for up to 18 months. Mr. Todd's severance compensation agreement includes noncompetition, nonsolicitation and confidentiality provisions restricting Mr. Todd's ability to engage in activities competitive with Pinnacle for a period of 12 months following termination of employment.

RETENTION AND COMPLETION INCENTIVE PLAN

Pinnacle has established a plan for the payment of retention and completion incentive bonuses in order to encourage selected employees, including each of the Named Executive Officers, to continue their employment with the company. If a covered employee's employment does not terminate on or before January 7, 2003, the employee will receive a retention bonus ranging from 25 percent to 100 percent of the employee's base salary as of January 7, 2002. The retention bonus will be paid in three equal installments on May 7, 2002, September 7, 2002, and January 7, 2003. However, if the employment of a covered employee who is not a party to a severance compensation agreement with Pinnacle is terminated by Pinnacle without cause prior to January 7, 2003, the employee will receive the retention bonus. If a restructuring, recapitalization or reorganization of Pinnacle occurs prior to January 7, 2003, the payment of the retention bonus installment payments will be accelerated. If a covered employee's employment does not terminate for any reason before the completion of a restructuring, recapitalization or reorganization of Pinnacle, the employee will receive a completion bonus ranging from 25 percent to 100 percent of the employee's base salary as of January 7, 2002. However, if the employee's employment is terminated without cause within six weeks prior to the completion of a restructuring, recapitalization or reorganization of Pinnacle, the employee will be entitled to the completion bonus.

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COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION

Pinnacle's Compensation Committee is currently composed of Mrs. Boggs, Mr. O'Brien and Mr. Smith. No current or former member of the Compensation Committee is currently or was formerly an officer or an employee of Pinnacle or its subsidiaries.

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