SUBSCRIPTION
AND REGISTRATION RIGHTS AGREEMENT
THE
SAVANNAH BANCORP, INC.
Private
Offering
of
up to 400,000 Shares of
Common
Stock
This Subscription and Registration Rights Agreement (this "Agreement"),
made as of the date set forth below by and between The Savannah Bancorp,
Inc., a
Georgia corporation (the "Company"), and the undersigned (the
"Subscriber"), is intended to set forth certain representations,
covenants and agreements between the Company and the Subscriber, with respect
to
the offering (the "Offering") for sale by the Company of shares (the
"Shares") of the Company's common stock, par value $1.00 per share (the
"Common Stock"), as described in the Company's Private Placement
Memorandum dated August 12, 2005 (the "Memorandum"), a copy of which has
been delivered to the Subscriber. The Shares are being offered by
the
Company through Sterne, Agee & Xxxxx, Inc., as placement agent (the
"Placement Agent").
1. Subscription.
Subject
to the terms and conditions hereof, the Subscriber hereby irrevocably subscribes
for and agrees to purchase from the Company the number of Shares set forth
under
the Subscriber's name on the signature page hereto at a purchase price of
$30.50
per Share (the "Offering
Price"),
and
the Company agrees to sell such Shares to the Subscriber at the Offering
Price,
subject to the Company's right to sell to the Subscriber such lesser number
of
Shares as the Company may, in its sole discretion, deem necessary or
desirable.
2. Delivery
of Subscription Amount; Acceptance of Subscription; Delivery of
Shares.
The
Subscriber understands and agrees that this subscription is made subject
to the
following terms and conditions:
(b) Contemporaneously
with the completion, execution and delivery of this Agreement, the Subscriber
shall complete, execute and deliver the Certificate of Accredited Investor
Status attached as Exhibit
B
hereto,
and shall submit to the Company payment in the form of either a wire of
immediately available United States funds or a check, each in the amount
equal
to the Offering Price multiplied by the number of Shares for which the
Subscriber has subscribed (the "Subscription
Amount")
in
accordance with the Subscription Instructions set forth on Exhibit
A
hereto;
(c) The
subscription for Shares shall be deemed to be accepted only when this Agreement
has been signed by an authorized officer of the Company, and the deposit
of the
Subscription Amount for clearance will not be deemed an acceptance of this
Agreement;
(d) The
Company
shall have the right to reject this subscription, in whole or in part, and
shall
have the right to allocate Shares among subscribers in any manner it may
desire;
(e) The
payment
representing the Subscription Amount (or, in the case of rejection of a portion
of the Subscriber's subscription, the part of the payment relating to such
rejected portion) will be returned promptly to the Subscriber, without interest,
if the Subscriber's subscription is rejected in whole or in part or if the
Offering is withdrawn or canceled;
(f) The
Placement
Agent and the Company may conduct one or more closings of the Offering (each
a
"Closing")
until
all 400,000 Shares offered for sale in the Offering are sold;
(g) The
Company
may, in its sole discretion, terminate the Offering at any time and accept
any
subscriptions then in its receipt;
(h) Certificates
representing the Shares purchased will be issued in the name of each Subscriber
within 14 days following each Closing;
(i) The
minimum Subscription Amount is $50,000, provided, however, that the Company
reserves the right, in its sole discretion, to accept subscriptions for less
than the minimum Subscription Amount;
(j) The
Offering
is being conducted on a "best efforts" basis, and the Company is not required
to
accept any minimum number of subscriptions before conducting a Closing;
and
(k) The
representations and warranties of the Company and the Subscriber set forth
herein shall be true and correct as of the date that the Company accepts
this
subscription.
3. Terms
of
Subscription.
(a) The
subscription period will begin as of August 12, 2005, and will continue until
such time as the Company terminates it in its sole discretion.
(b) The
Placement Agent will receive a placement management fee equal to five percent
(5.0%) of the total gross proceeds resulting from the placement of Shares
by the
Placement Agent (under the terms of the agreement between the Company and
the
Placement Agent, the Placement Agent is assured that it may place not less
than
two-thirds of the Shares to be sold) and one percent (1%) of the total gross
proceeds resulting from the placement of Shares by the Company. The Company
shall also reimburse the Placement Agent for its out-of-pocket expenses,
including the fees and expenses of the Placement Agent's legal counsel, up
to a
maximum (without the consent of the Company) of $45,000.
(c) If
the
Subscriber is not a United States person, the Subscriber hereby represents
that
it has satisfied itself as to the full observance of the laws of its
jurisdiction in connection with any invitation to subscribe for the Shares
or
any use of this Agreement, including, without limitation, (i) the legal
requirements within its jurisdiction for the purchase of the Shares, (ii)
any
foreign exchange restrictions applicable to such purchase, (iii) any
governmental or other consents that may need to be obtained, and (iv) the
income
tax and other tax consequences, if any, that may be relevant to the purchase,
holding, redemption, sale or transfer of the Shares. The Subscriber represents
and warrants that the Subscriber's subscription and payment for, and the
Subscriber's continued beneficial ownership of, the Shares will not violate
any
applicable securities or other laws of the Subscriber's
jurisdiction.
4. Registration
Rights.
(a) The
Subscriber acknowledges that it is acquiring the Shares for its own account
and
for the purpose of investment and not with a view to any distribution or
resale
thereof within the meaning of the Securities Act of 1933, as amended (the
"Securities
Act").
The
Subscriber further agrees that it will not sell, assign or transfer the Shares
at any time in violation of the Securities Act and acknowledges that, in
taking
unregistered securities, it must continue to bear the economic risk of its
investment for an indefinite period of time because of the fact that the
Shares
have not been registered under the Securities Act, and further realizes that
the
Shares cannot be sold unless subsequently registered under the Securities
Act or
an exemption from such registration is available. The Subscriber also
acknowledges that appropriate legends reflecting the status of the Shares
under
the Securities Act may be placed on the face of the certificates for such
Shares
at the time of their transfer and delivery to the holder thereof.
(b) The
Shares
may not be transferred except in a transaction that is in compliance with
the
Securities Act. Except as provided hereafter with respect to registration
of the
Shares, it shall be a condition to any such transfer that the Company shall
be
furnished with an opinion of counsel to the holder of such Shares, reasonably
satisfactory to the Company, to the effect that the proposed transfer would
be
in compliance with the Securities Act.
(c) Within
90
days following the last Closing, as may be extended by such additional number
of
days as are solely and directly attributable to any delay caused by any act
or
failure to act by any of the purchasers of the Shares or their counsel, the
Company shall prepare and file with the Securities and Exchange Commission
(the
"SEC"),
a
registration statement on Form S-3 and such other documents as may be necessary
in the opinion of counsel for the Company, and use its best efforts to have
such
registration statement declared effective as soon as reasonably practicable
after such filing (including responding to comments of the SEC within 15
business days following the Company's receipt thereof, unless otherwise directed
or agreed to by a majority of the holders of Shares or their counsel, or
unless
a delay in so responding is caused by any act or failure to act by any of
the
holders of Shares or their counsel) in order to comply with the provisions
of
the Securities Act, so as to permit the registered resale of the Shares for
a
period of two (2) years following the last sale of Shares in the Offering
by
each and every holder of Shares, except for those holders who designate on
the
signature page hereto that they do not wish to have their Shares included
in the
registration statement. The Shares that are registered for resale under such
registration statement are referred to herein as the "Offering Shares,"
and the Subscribers who are eligible to sell their Offering Shares under
such
registration
statement, together with theiraffiliates, are hereafter referred to as
"Offering Holders." The Company will include in such registration
statement (i) the information required under the Securities Act to be so
included concerning the Offering Holders, as provided by the Offering Holders
on
the signature pages to this Agreement and the other Subscription and
Registration Rights Agreements entered into in connection with the Offering,
including any changes in such information that may be provided by the Offering
Holders in writing to the Company from time to time, and (ii) a section
entitled
"Plan of Distribution," substantially in the form of Exhibit
C
hereto,
that describes the various procedures that may be used by the Offering
Holders
in the resale of their Offering Shares.
(d) In
the event
that the Company does not file a registration statement to register the Offering
Shares with the SEC within the time period specified in Section 4(c), the
Company will be required to pay a penalty to each Offering Holder equal to
one
percent (1%) of such Offering Holder's purchase price for the Offering Shares,
and an additional one percent (1%) for each additional 30-day period during
which such registration statement is not filed.
(e) Notwithstanding
the
foregoing provisions of this Section 4, the Company may voluntarily suspend
the
effectiveness of any such registration statement for a limited time, which
in no
event shall be longer than 60 days in any three‑month period and no longer than
120 days in any twelve-month period, if the Company has been advised in writing
by counsel or underwriters to the Company that the offering of any Offering
Shares pursuant to the registration statement would materially adversely
affect,
or would be improper in view of (or improper without disclosure in a
prospectus), a proposed financing, reorganization, recapitalization, merger,
consolidation, or similar transaction involving the Company. The Company
shall
notify all Offering Holders to such effect, and, upon receipt of such notice,
each such Offering Holder shall immediately discontinue any sales of Offering
Shares pursuant to such registration statement until such Offering Holder
has
received copies of a supplemented or amended prospectus or until such Offering
Holder is advised in writing by the Company that the then current prospectus
may
be used and has received copies of any additional or supplemental filings
that
are incorporated or deemed incorporated by reference in such
prospectus.
(f) If
any
event occurs that would cause any such registration statement to contain
a
material misstatement or omission or not to be effective and usable during
the
period that such registration statement is required to be effective and usable,
the Company shall promptly notify the Offering Holders of such event and,
if
requested, the Offering Holders shall immediately cease making offers of
Offering Shares and return all prospectuses to the Company. The Company shall
promptly file an amendment to the registration statement to correct such
misstatement or omission and use its best efforts to cause such amendment
to be
declared effective as soon as reasonably practicable thereafter. The Company
shall promptly provide the Offering Holders with revised prospectuses and,
following receipt of the revised prospectuses, the Offering Holders shall
be
free to resume making offers of the Offering Shares.
(g) Notwithstanding
any
provision contained herein to the contrary, the Company's obligation to include,
or continue to include, Offering Shares in any such registration statement
under
this Section 4 shall terminate to the extent such Offering Shares are eligible
for resale under Rule 144(k) promulgated under the Securities Act.
(h) If
and
whenever the Company is required by the provisions of this Agreement to use
its
best efforts to effect the registration of the Offering Shares under the
Securities Act for the account of an Offering Holder, the Company will, as
promptly as possible:
(i) prepare
and
file with the SEC a registration statement, on Form S-3, complying with
applicable requirements under the Securities Act, with respect to such
securities and use its best efforts to cause such registration statement
to
become and remain effective for a period of two (2) years following the
last
sale of Shares in the Offering;
(ii) prepare
and
file with the SEC such amendments and supplements to such registration
statement
and the prospectus used in connection therewith as may be necessary to
keep such
registration statement effective and to comply with the requirements of
the
Securities Act and the rules and regulations promulgated by the SEC thereunder
relating to the sale or other disposition of the securities covered by
such
registration statement; and
(iii) furnish
to
each Offering Holder such numbers of copies of a prospectus, including
a
preliminary prospectus, complying with the requirements of the Securities
Act,
and such other documents as such Offering Holder may reasonably request
in order
to facilitate the public sale or other disposition of the Offering Shares
owned
by such Offering Holder, but such Offering Holder shall not be entitled
to use
any selling materials other than a prospectus and such other materials
as may be
approved by the Company, which approval will not be unreasonably
withheld.
(i) Except
as provided below in
this Section 4, the expenses incurred by the Company in connection
with
action taken by the Company to comply with this Section 4, including,
without limitation, all registration and filing fees, printing and delivery
expenses, accounting fees, fees and disbursements of counsel to the Company,
consultant and expert fees, premiums for liability insurance, if the Company
chooses to obtain such insurance, obtained in connection with a registration
statement filed to effect such compliance and all expenses, including counsel
fees, of complying with any state securities laws, shall be paid by the
Company. All fees and disbursements of any counsel, experts, or
consultants employed by any Offering Holder shall be borne by such Offering
Holder. The Company shall not be obligated in any way in connection
with
any registration pursuant to this Section 4 for any selling commissions
or
discounts payable by any Offering Holder to any underwriter or broker of
securities to be sold by such Offering Holder. The Subscriber agrees
that
any such selling commissions or discounts shall be borne by such Offering
Holder.
(j) In the
event of any
registration of Shares pursuant to this Section 4, the Company will
indemnify and hold harmless each Offering Holder, its officers, directors,
attorneys, partners, agents, employees and consultants and each underwriter
of
such securities, and any person who controls such Offering Holder or underwriter
within the meaning of Section 15 of the Securities Act (collectively,
the
"Indemnified Parties"), against all claims, actions, losses, damages,
liabilities and expenses, joint or several, to which any of such Indemnified
Parties may become subject under the Securities Act or otherwise, insofar
as
such losses, claims, damages, liabilities or actions arise out of or are
based
upon any actual or alleged untrue statement of any material fact contained
in
any registration statement under which such
securities were registered
under the Securities Act, any preliminary prospectus or final prospectus
contained therein, or any amendment or supplement thereof, or arise out of
or
are based upon the actual or alleged omission to state therein a material
fact
required to be stated therein or necessary to make the statements therein,
in
light of the circumstances under which they were made, not misleading, and
will
reimburse each of such Indemnified Parties for any legal and any other expenses
reasonably incurred by such Indemnified Party in connection with investigating
or defending any such loss, claim, damage, liability, or action; provided,
however, that the Company will not be liable in any such case to the extent
that
any such loss, claim, damage, liability or action arises directly out of
or is
based primarily upon an untrue statement or omission of a material fact made
in
said registration statement, said preliminary prospectus or said prospectus,
or
said amendment or supplement in reliance upon and in conformity with written
information furnished to the Company by such Offering Holder or such underwriter
specifically for use in the preparation thereof; and provided further, however,
that the Company will not be liable in any such case to the extent that any
such
loss, claim, damage or liability or action arises directly out of or is based
primarily upon an untrue statement or omission of a material fact made in
any
preliminary prospectus or final prospectus if (i) such Offering Holder failed
to
send or deliver the copy of the final prospectus or prospectus supplement
which
such Offering Holder shall have been previously provided by the Company,
with or
prior to the delivery of written confirmation of the sale of the Offering
Shares, and (ii) the final prospectus or prospectus supplement would have
corrected such untrue statement or omission.
(k) At any time when
a prospectus
relating to the Offering is required to be delivered under the Securities
Act,
the Company will notify the Offering Holder of the happening of any event,
upon
the notification or awareness of such event by an executive officer of the
Company, as a result of which the prospectus included in such registration
statement, as then in effect, includes an untrue statement of material fact
or
omits to state a material fact required to be stated therein or necessary
to
make the statements therein not misleading in light of the circumstances
then
existing.
(l) In the
event of any
registration of any securities under the Securities Act pursuant to this
Section 4, the Subscriber agrees to indemnify and hold harmless the
Company, its officers, directors, attorneys, partners, agents, employees
and
consultants and any person who controls the Company within the meaning of
Section 15 of the Securities Act (collectively, the "Indemnified Persons"),
against any losses, claims, damages, liabilities, or actions, joint or several,
to which any of such Indemnified Persons may become subject under the Securities
Act or otherwise, insofar as such losses, claims, damages, liabilities, or
actions arise out of or are based upon any actual or alleged untrue statement
of
any material fact contained in any registration statement under which such
securities were registered under the Securities Act, any preliminary prospectus
or final prospectus contained therein, or any amendment or supplement thereto,
or arise out of or are based upon the actual or alleged omission to state
therein a material fact required to be stated therein or necessary to make
the
statements therein not misleading, in each case to the extent and only to
the
extent that any such loss, claim, damage, liability, or action arises out
of or
is based upon an untrue statement or omission of a material fact made in
said
registration statement, said preliminary prospectus or said prospectus or
said
amendment or supplement in reliance upon
and in conformity with
written information furnished to the Company by the Subscriber or any affiliate
(as defined in the Securities Act) of the Subscriber specifically for use
in the
preparation thereof.
(m) Any party entitled to
indemnification
hereunder will (i) give prompt written notice to the indemnifying
party of
any claim with respect to which it seeks indemnification and (ii) unless
in
such indemnified party's reasonable judgment a conflict of interest between
such
indemnified and indemnifying parties may exist with respect to such claim,
permit such indemnifying party to assume the defense of such claim with counsel
reasonably satisfactory to the indemnified party. If such defense
is
assumed, the indemnifying party will not be subject to any liability for
any
settlement made by the indemnified party without its consent (which consent
may
not be unreasonably withheld). An indemnifying party who is not entitled
to, or elects not to, assume the defense of a claim will not be obligated
to pay
the fees and expenses of more than one counsel for all parties indemnified
by
such indemnifying party with respect to such claim, unless in the reasonable
judgment of any indemnified party a conflict of interest may exist between
such
indemnified party and any other of such indemnified parties with respect
to such
claim.
(n) With a view to
making available to
the Offering Holder the benefits of Rule 144 promulgated under the
Securities Act, the Company agrees that it will use its best efforts to maintain
registration of its Common Stock under Section 12 or 15 of the Securities
and Exchange Act of 1934, as amended (the "Exchange Act"), and to file
with the SEC in a timely manner all reports and other documents required
to be
filed by an issuer of securities registered under the Exchange Act so as
to
maintain the availability of Rule 144. Upon the request of
any record
owner, the Company will deliver to such owner a written statement as to whether
it has complied with the reporting requirements of Rule 144.
5. Representations
and Warranties of the Subscriber.
The
Subscriber hereby represents and warrants to the Company and the Placement
Agent
as follows:
(a) The
Subscriber is acquiring the Shares for its own account, for investment and
not
with a view to, or for resale in connection with, any distribution or public
offering thereof within the meaning of the Securities Act, and applicable
state
securities laws. The Subscriber understands that (A) the Shares (1) have
not
been registered under the Securities Act or any state securities laws, (2)
will
be issued in reliance upon an exemption from the registration and prospectus
delivery requirements of the Securities Act pursuant to Section 4(2) and/or
Regulation D thereof, and (3) will be issued in reliance upon exemptions
from
the registration and prospectus delivery requirements of state securities
laws
which relate to private offerings, and (B) the Subscriber must therefore
bear
the economic risk of such investment indefinitely unless a subsequent
disposition thereof is registered under the Securities Act and applicable
state
securities laws or is exempt therefrom. The Subscriber further understands
that
such exemptions depend upon, among other things, the bona fide nature of
the
investment intent of the Subscriber expressed herein. Pursuant to the foregoing,
the Subscriber acknowledges that the certificates representing the Shares
acquired by the Subscriber shall bear a restrictive legend substantially
as
follows:
"THE SHARES REPRESENTED BY THIS CERTIFICATE
ARE
SUBJECT TO RESTRICTIONS ON TRANSFER UNDER THE SECURITIES ACT OF 1933, AS
AMENDED, AND STATE SECURITIES LAWS, AND MAY
NOT
BE OFFERED FOR SALE, SOLD, ASSIGNED, TRANSFERRED, PLEDGED OR OTHERWISE DISPOSED
OF UNLESS (I) REGISTERED UNDER THE APPLICABLE SECURITIES LAWS OR (II) AN
OPINION
OF COUNSEL, WHICH OPINION AND COUNSEL ARE BOTH REASONABLY SATISFACTORY TO
THE
COMPANY, HAS BEEN DELIVERED TO THE COMPANY AND SUCH OPINION STATES THAT THE
SHARES MAY BE TRANSFERRED WITHOUT SUCH REGISTRATION."
(b) The
Subscriber has knowledge, skill and experience in financial, business and
investment matters relating to an investment of this type and is capable
of
evaluating the merits and risks of such investment and protecting the
Subscriber's interest in connection with the acquisition of the Shares. The
Subscriber understands that the acquisition of the Shares is a speculative
investment and involves substantial risks and that the Subscriber could lose
the
Subscriber's entire investment in the Shares. Further, the Subscriber has
carefully read and considered the matters set forth under the section entitled
"Risk Factors" in the Memorandum, and has taken full cognizance of and
understands all of the risks related to the purchase of the Shares. To the
extent deemed necessary by the Subscriber, the Subscriber has retained, at
its
own expense, and relied upon, appropriate professional advice regarding the
investment, tax and legal merits and consequences of purchasing and owning
the
Shares. The Subscriber has the ability to bear the economic risks of the
Subscriber's investment in the Company, including a complete loss of the
investment, and the Subscriber has no need for liquidity in such
investment.
(c) The
Subscriber has been furnished by the Company all information (or provided
access
to all information) regarding the business and financial condition of the
Company, its expected plans for future business activities, the attributes
of
the Shares and the merits and risks of an investment in the Shares which
the
Subscriber has requested or otherwise believes that the Subscriber needs
to
evaluate the investment in the Company.
(d) The
Subscriber is in receipt of and has carefully read and understands the following
items:
·
Confidential Private Placement Memorandum, dated August 12, 2005, and the
appendices attached thereto (Appendices A-G);
·
Annual Report Amendment on Form 10-K/A for fiscal year ended December 31,
2004,
filed by the Company with the SEC on August 8, 2005;
·
Annual Report on Form 10-K for fiscal year ended December 31, 2004, filed
by the
Company with the SEC on March 30, 2005;
·
Quarterly Report on Form 10-Q for the quarter ended March 31, 2005, filed
by the
Company with the SEC on May 13, 2005;
·
Quarterly Report on Form 10-Q for the quarter ended June 30, 2005, filed
by the
Company with the SEC on August 8, 2005;
·
Definitive Proxy Statement on Schedule DEF 14A, filed by the Company with
the
SEC on March 25, 2005; and
·
Current Report on Form 8-K, dated July 7, 2005, filed by the Company with
the
SEC on July 8, 2005.
(e) In
making
the Subscriber's investment decision, the Subscriber is relying solely on
investigations made by the Subscriber and the Subscriber's representative(s),
if
any. The offer to sell the Shares was communicated to the Subscriber in such
a
manner that the Subscriber was able to ask questions of and receive answers
from
the management of the Company concerning the terms and conditions of the
proposed transaction. At no time was the Subscriber presented with or solicited
by or through any advertisement, article, leaflet, public promotional meeting,
notice or other communication published in any newspaper, magazine or similar
media or broadcast over television or radio or presented at any seminar or
meeting or any other form of general or public advertising or
solicitation.
(f) The
Subscriber acknowledges that the Subscriber has been advised that:
(i) The
Shares
offered hereby have not been approved or disapproved by the SEC or any
state
securities commission nor has the SEC or any state securities commission
passed
upon the accuracy or adequacy of any representations by the Company. Any
representation to the contrary is a criminal offense.
(ii) In
making an
investment decision, the Subscriber must rely on its own examination of
the
Company and the terms of the Offering, including the merits and risks involved.
The Shares have not been recommended by any federal or state securities
commission or other regulatory authority. Furthermore, the foregoing authorities
have not confirmed the accuracy or determined the adequacy of any representation
by the Company. Any representation to the contrary is a criminal offense.
(iii) The
Shares
will be "restricted securities" within the meaning of Rule 144 under
the
Securities Act, are subject to restrictions on transferability and resale
and
may not be transferred or resold except as permitted under the Securities
Act
and applicable state securities laws, pursuant to registration or exemption
therefrom. The Subscriber is aware that the Subscriber may be required
to bear
the financial risks of this investment for an indefinite period of
time.
(g) The
Subscriber acknowledges and is aware that there has never been any
representation, guarantee or warranty made by the Company or any officer,
director, employee or agent or representative of the Company, expressly or
by
implication, as to (i) the approximate or exact length of time that the
Subscriber will be required to remain an owner of the Shares; (ii) the
percentage of profit and/or amount of or type of consideration, profit or
loss
to be realized, if any, as a result of this investment; or (iii) that the
limited past performance (if any) or experience on the part of the Company,
or
any future expectations regarding the Company's business or operations, will
in
any way indicate the predictable results of the ownership of Shares or of
the
overall financial performance of the Company.
(h) The
Subscriber agrees to furnish the Company such other information as the Company
may reasonably request in order to verify the accuracy of the information
contained herein and agrees to notify the Company immediately of any material
change in the information provided herein that occurs prior to the Company's
acceptance of this Agreement.
(i) The
Subscriber further represents and warrants that the Subscriber is an "accredited
investor" within the meaning of Rule 501 of Regulation D under the Securities
Act, and the Subscriber has executed the Certificate of Accredited Investor
Status, attached hereto as Exhibit
B.
(j) If
the
Subscriber is a natural person, the Subscriber has reached the age of majority
in the state in which the Subscriber resides, has adequate means of providing
for the Subscriber's current financial needs and contingencies, is able to
bear
the substantial economic risks of an investment in the Shares for an indefinite
period of time, has no need for liquidity in such investment and, at the
present
time, could afford a complete loss of such investment.
(k) If
this
Agreement is executed and delivered on behalf of a partnership, corporation,
trust, estate or other entity (an "Entity"):
(i)
such Entity has the full legal right and power and all authority and approval
required (a) to execute and deliver, or authorize execution and delivery
of,
this Agreement and all other instruments executed and delivered by or on
behalf
of such Entity in connection with the purchase of the Shares, (b) to delegate
authority pursuant to power of attorney and (c) to purchase and hold such
Shares, (ii) the signature of the party signing on behalf of such Entity
is
binding upon such Entity; and (iii) such Entity has not been formed for the
specific purpose of acquiring such Shares, unless each beneficial owner of
such
Entity is qualified as an accredited investor within the meaning of Rule
501(a)
of Regulation D promulgated under the Securities Act and has submitted
information substantiating such individual qualification.
(l) If
the
Subscriber is a retirement plan or is investing on behalf of a retirement
plan,
the Subscriber acknowledges that an investment in the Common Stock poses
additional risks, including, without limitation, the inability to use losses
generated by an investment in the Common Stock to offset taxable income.
(m) The
Subscriber represents and warrants that it is not a broker-dealer or an
affiliate of a broker-dealer, except as follows:
_______________________________________________
_____________________________________________________________________________.
If the Subscriber is a broker-dealer, the Subscriber acknowledges that the
Subscriber will be deemed to be an underwriter with respect to the resale
of its
Shares. If the Subscriber is an affiliate of a broker-dealer, the Subscriber
acknowledges that the Subscriber will be deemed to be an underwriter with
respect to the resale of its Shares to the extent that such Shares are sold
through its affiliated broker-dealer. To the extent that the Subscriber is
affiliated in any manner with a broker-dealer, the Subscriber further represents
and warrants that it is purchasing the Shares in the ordinary course of its
business and that as of the date hereof it has no agreements or understandings,
directly or indirectly, with any person to distribute the Shares.
The foregoing representations and warranties and undertakings
are
made by the Subscriber with the intent that they be relied upon by the
Company
and the Placement Agent in determining the Subscriber's suitability as
an
investor, and the Subscriber hereby agrees that such representations and
warranties shall survive the Subscriber's purchase of the Shares.
6. Representations
and Warranties of the Company.
The
Company hereby represents and warrants to the Subscriber as follows:
(a) The
Company
is duly incorporated, validly existing and in good standing under the laws
of
the State of Georgia, and is duly qualified to do business as a foreign
corporation in all jurisdictions in which the failure to be so qualified
would
materially and adversely affect the business or financial condition, properties
or operations of the Company.
(b) The
Company
has duly authorized the issuance and sale of the Shares in accordance with
the
terms of this Agreement (as described herein) by all requisite corporate
action,
including the authorization of the Company's Board of Directors of the issuance
and sale of the Shares in accordance herewith, and the execution, delivery
and
performance of any other agreements and instruments executed in connection
herewith. This Agreement constitutes a valid and legally binding obligation
of
the Company, enforceable in accordance with its terms, except (i) as limited
by
applicable bankruptcy, insolvency, reorganization, moratorium, and other
laws of
general application affecting enforcement of creditors' rights generally,
(ii)
as limited by laws relating to the availability of specific performance,
injunctive relief, or other equitable remedies, and (iii) to the extent the
indemnification provisions contained herein may be limited by applicable
federal
or state securities laws.
(c) The
Memorandum, as of its date and as of the date of this Agreement, does not
contain any untrue statement of a material fact or omit to state any material
fact required to be stated therein or necessary in order to make the statements
therein, in the light of the circumstances under which they were made, not
misleading.
(d) The
documents incorporated by reference or included with the Memorandum, at the
time
they were filed with the SEC, complied in all material respects with the
requirements of the Exchange Act, and, when read together and with the other
information in the Memorandum, did not contain, at the time they were filed
with
the SEC, any untrue statement of a material fact or omit to state a material
fact required to be stated therein or necessary in order to make the statements
therein, in the light of the circumstances under which they were made, not
misleading.
7. Understandings.
The
Subscriber understands, acknowledges and agrees with the Company as
follows:
(a) This
Subscription may be rejected, in whole or in part, by the Company in its
sole
and absolute discretion, at any time before the Closing, notwithstanding
prior
receipt by the undersigned of notice of acceptance of the undersigned's
Subscription. The Company may terminate this Offering at any time in its
sole
discretion. Neither the execution of this Agreement nor the solicitation
of the
investment contemplated hereby shall create any obligation of the Company
to
accept any subscription or complete the Offering. The Company is not required
to
accept any minimum number of subscriptions before conducting a
Closing.
(b) The
Subscriber hereby acknowledges and agrees that the subscription hereunder
is
irrevocable by the Subscriber, that, except as required by law, the Subscriber
is not entitled to cancel, terminate or revoke this Agreement or any agreements
of the Subscriber hereunder and that this Agreement and such other agreements
shall survive the death or disability of the Subscriber and shall be binding
upon and inure to the benefit of the parties and their heirs, executors,
administrators, successors, legal representatives and permitted assigns.
If the
Subscriber is more than one person, the obligations of the Subscriber hereunder
shall be joint and several and the agreements, representations, warranties
and
acknowledgments herein contained shall be deemed to be made by and be binding
upon each such person and his/her heirs, executors, administrators, successors,
legal representatives and permitted assigns.
(c) No
federal or
state agency has made any finding or determination as to the accuracy or
adequacy of the Memorandum or as to the suitability of the Offering for
investment nor any recommendation or endorsement of the Shares.
(d) The
Offering
is intended to be exempt from registration under the Securities Act by virtue
of
Section 4(2) of the Securities Act and the provisions of Regulation D
thereunder, which is in part dependent upon the truth, completeness and accuracy
of the statements made by the Subscriber herein.
(e) There
can be
no assurance that the Subscriber will be able to sell or dispose of the Shares.
It is understood that in order not to jeopardize the Offering's exempt status
under Section 4(2) of the Securities Act and Regulation D, any transferee
will,
at a minimum, be required to fulfill the investor suitability requirements
thereunder.
(f) The
Subscriber acknowledges that the information contained in the Memorandum
is
confidential and non-public and agrees that all such information shall be
kept
in confidence by the Subscriber and neither used for the Subscriber's personal
benefit (other than in connection with this subscription) nor disclosed to
any
third party for any reason; provided, however, that this confidentiality
obligation shall not apply to any such information that (i) is part of the
public knowledge or literature, (ii) becomes part of the public knowledge
or
literature (except as a result of a breach of this provision) or (iii) is
received from third parties (except third parties who disclose such information
in violation of any confidentiality agreements or obligations, including,
without limitation, any subscription agreement entered into with the Company).
In addition, the Subscriber may disclose any information as may be required
by
law or applicable legal process; provided, however, to the extent permitted
by
law or applicable legal process, the Subscriber shall provide the Company
at
least five business days prior written notice before making any such
disclosure.
(g) The
representations, warranties and agreements of the Subscriber contained herein
and in any other writing delivered in connection with the transactions
contemplated hereby shall be true and correct in all respects on and as of
the
date of the Closing of the sale of the Shares as if made on and as of such
date
and shall survive the execution and delivery of this Agreement and the purchase
of the Shares.
8. Survival;
Indemnification.
All
representations, warranties and covenants contained in this Agreement and
the
indemnification obligations contained in this Section 8 shall survive (i)
the
acceptance of this
Agreement
by the Company, (ii) changes in the transactions, documents and instruments
described herein which are not material or which are to the benefit of the
Subscriber, and (iii) the death or disability of the Subscriber. The Subscriber
understands the meaning and legal consequences of the representations,
warranties and covenants contained in this Agreement and that the Company
and
the Placement Agent have relied upon such representations, warranties and
covenants in determining the Subscriber's qualification and suitability to
purchase the Shares. The Subscriber hereby agrees to indemnify, defend and
hold
harmless the Company, the Placement Agent and their respective officers,
directors, employees, agents and controlling persons, from and against any
and
all losses, claims, damages, liabilities, expenses (including attorneys'
fees
and disbursements), judgments or amounts paid in settlement of actions
arising out of or resulting from the untruth of any representation of the
Subscriber herein or the breach of any warranty or covenant herein by the
Subscriber. Notwithstanding the foregoing, however, no representation, warranty,
covenant or acknowledgment made herein by the Subscriber shall in any manner
be
deemed to constitute a waiver of any rights granted to it under the Securities
Act or state securities laws.
9. Notices.
All
notices and other communications provided for herein shall be in writing
and
shall be deemed to have been duly given if delivered personally or sent by
registered or certified mail, return receipt requested, postage prepaid,
or sent
by reputable overnight courier, charges prepaid:
(a) if
to the
Company, to the following address:
The
Savannah Bancorp, Inc.
00
Xxxx
Xxxxxx
Xxxxxxxx,
Xxxxxxx 00000
Attn:
G. Xxxx Xxxx, Xx.
Telephone:
(000) 000-0000
(b) if
to the
Subscriber, to the address set forth on the signature page hereto; or
at
such other address as any party shall have specified by notice in writing
to the
other.
10. Notification
of Changes.
The
Subscriber agrees and covenants to notify the Company immediately upon the
occurrence of any event prior to the consummation of the Offering that would
cause any representation, warranty, covenant or other statement contained
in
this Agreement to be false or incorrect or of any change in any statement
made
herein occurring prior to the consummation of the Offering.
11. Assignability;
Modification.
This
Agreement is not assignable by the Subscriber, and may not be modified, waived
or terminated except by an instrument in writing signed by the party against
whom enforcement of such modification, waiver or termination is
sought.
12. Binding
Effect.
Except
as otherwise provided herein, this Agreement shall be binding upon and inure
to
the benefit of the parties and their heirs, executors, administrators,
successors, legal representatives and permitted assigns, and the agreements,
representations, warranties and acknowledgments contained herein shall be
deemed
to be
made
by
and be binding upon such heirs, executors, administrators, successors, legal
representatives and permitted assigns.
13. Obligations
Irrevocable.
The
obligations of the Subscriber shall be irrevocable, except with the written
consent of the Company, until the consummation or termination of the
Offering.
14. Entire
Agreement.
This
Agreement constitutes the entire agreement of the Subscriber and the Company
relating to the matters contained herein, superseding all prior contracts
or
agreements, whether oral or written.
15. Governing
Law.
This
Agreement shall be governed by and construed in accordance with the laws
of the
State of GEORGIA, without regard to the principles of conflicts of law thereof
that would require the application of the laws of any jurisdiction other
than
GEORGIA.
16. Severability.
If any
provision of this Agreement or the application thereof to the Subscriber
or any
circumstance shall be held invalid or unenforceable to any extent, the remainder
of this Agreement and the application of such provision to other subscriptions
or circumstances shall not be affected thereby and shall be enforced to the
greatest extent permitted by law.
17. Headings.
The
headings in this Agreement are inserted for convenience and identification
only
and are not intended to describe, interpret, define, or limit the scope,
extent
or intent of this Agreement or any provision hereof.
18. Counterparts.
This
Agreement may be executed in any number of counterparts, each of which when
so
executed and delivered shall be deemed to be an original and all of which
together shall be deemed to be one and the same agreement.
19. Counsel.
The Subscriber hereby acknowledges that the Company and its counsel represent
the interests of the Company and not those of the Subscriber in any agreement
(including this Agreement) to which the Company is a party.
[SIGNATURES
TO FOLLOW]
IN WITNESS WHEREOF, the Subscriber has executed this Subscription and
Registration Rights Agreement as of ____________ ___, 2005.
SUBSCRIBER
____________________________________
Number of Shares:
____________________
Offering Price per
Share: $ 30.50________
Subscription
Amount: $________________
By:
________________________________
Name:______________________________
Title:_______________________________
Address:
___________________________
____________________________________
____________________________________
Please designate name and social security
or tax identification number in which stock certificate(s) representing Shares
purchased are to be registered.
____________________________________
Name
____________________________________
Social Security
or Tax
I.D. Number
Please designate address for delivery
of
stock certificate(s) representing Shares purchased (if different from
above).
____________________________________
____________________________________
____________________________________
Please designate the individual to whom
all
correspondence concerning the Subscriber's subscription for Shares should
be
sent, along with such individual's requested contact information.
Name:______________________________
Address:_____________________________
___________________________________
Telephone: (____)_____________________
Facsimile: (____) _____________________
E-mail:_ _____________________________
The name(s) of the natural
person(s) who will have voting and investment power over the Shares purchased
are as follows (please print legibly, as the name(s) must be disclosed in
the
registration statement): ____________________________________________
Please indicate the number
of shares of the Common Stock currently owned by the Subscriber in addition
to
those being subscribed for in this Agreement (this must also be disclosed
in the
registration statement). __________________
The
Company hereby accepts the foregoing subscription subject to the terms and
conditions hereof as of ____________ ___, 2005.
THE SAVANNAH BANCORP,
INC.,
a Georgia
corporation
By:_________________________________
Name:
Title:
The undersigned is an "accredited investor," as that term is defined in
Regulation D under the Securities Act of 1933, as amended (the "Securities
Act"). The undersigned has checked the box below indicating the basis
on which the undersigned is representing the undersigned's status as an
"accredited investor":
IN
WITNESS WHEREOF, the undersigned has executed this Certificate of Accredited
Investor Status effective as of the ___ day of ____________, 2005.
Name of Subscriber
By: ________________________
Name: ______________________
Title: _______________________
· a
block trade (which may involve crosses) in which the broker or dealer so engaged
will attempt to sell the securities as agent but may position and resell a
portion of the block as principal to facilitate the transaction;
· purchases
by a broker or dealer as principal and resale by such broker or dealer for
its
own account pursuant to this prospectus;
· ordinary
brokerage transactions and transactions in which the broker solicits purchasers;
and
· privately
negotiated transactions.
to
close
out the short positions, or loan or pledge the shares of common stock to
broker-dealers that in turn may sell them.
