Exhibit 10.1

 

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 & Leach, 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:
 
    (a)     The Subscriber understands that separate Subscription and
Registration Rights Agreements will be executed with other subscribers for up to
400,000 Shares to be sold in the Offering;
 
    (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;
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    (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.
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    (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
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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.
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    (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

 

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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.

 

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            (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

 

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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;

 

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·         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.
 
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    (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.
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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.
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    (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
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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.

25 Bull Street

Savannah, Georgia 31401

Attn:  G. Mike Odom, Jr.

Telephone:  (912) 629-6500

 

    (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
 
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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]

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            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).

 

____________________________________

____________________________________

____________________________________

 

 

 

 

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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:

 

 

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Exhibit A

 

HOW TO SUBSCRIBE

 

            (1)        If you are subscribing for the purchase of Shares, please
complete, date and sign the signature page to this Subscription and Registration
Rights Agreement in the applicable spaces.  Please signify the amount of Shares
for which you are subscribing by inserting such amount in the space provided for
on the signature page to the Agreement. 

 

            (2)        Complete, date and sign the "Certificate of Accredited
Investor Status" attached to this Agreement as Exhibit B.

 

            (3)        Send all signed, completed documents to:

 

                                    The Savannah Bancorp, Inc.

                                    25 Bull Street

                                    Savannah, Georgia 31401

                                    Attn:  G. Mike Odom, Jr.

                                    Telephone:  (912) 629-6500

                                    Facsimile:  (912) 629-6487

 

            (4)        Fax all signed, completed documents to:

 

                        Sterne, Agee & Leach, Inc.

                        Attn:   Charles I. Miller

                        Facsimile:  (205) 949-3626

                        Telephone:  (205) 949-3575

 

(5)        Either (a) make your check payable (in an amount equal to the number
of Shares for which you are subscribing multiplied by the Offering Price) to The
Savannah Bancorp, Inc. (noting "Subscription Funds" in the memo line on the
check) and deliver to the address provided in (3) above or (b) transmit funds
(in an amount equal to the number of Shares for which you are subscribing
multiplied by the Offering Price) via wire to the following account of The
Savannah Bancorp, Inc.: 

 

Domestic and International Transfers

Bank Name:                        The Bankers Bank, Atlanta, GA

ABA #                                061003415

Beneficiary:                        The Savannah Bank, N.A. (A/C #
10061204654)         

For Further Credit to:         The Savannah Bancorp, Inc.  (A/C #6037080)  

Special Instructions:           Please advise Nancy Aldrich      

 

ATTENTION SUBSCRIBERS:  NO SUBSCRIPTION WILL BE ACCEPTED UNLESS ALL
DOCUMENTATION PRESCRIBED HEREIN IS FULLY COMPLETED AND EXECUTED.  ANY MATERIALS
RECEIVED THAT ARE INCOMPLETE IN ANY RESPECT WILL BE RETURNED BY THE COMPANY.

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Exhibit B

 

CERTIFICATE OF ACCREDITED INVESTOR STATUS

 

            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":

 *      a bank as defined in Section 3(a)(2) of the Securities Act, or any
   savings and loan association or other institution as defined in Section
   3(a)(5)(A) of the Securities Act whether acting in its individual or
   fiduciary capacity; a broker or dealer registered pursuant to Section 15 of
   the Securities Exchange Act of 1934, as amended; an insurance company as
   defined in Section 2(13) of the Securities Act; an investment company
   registered under the Investment Company Act of 1940 or a business development
   company as defined in Section 2(a)(48) of that Act; a small business
   investment company licensed by the U.S. Small Business Administration under
   Section 301(c) or (d) of the Small Business Investment Act of 1958; a plan
   established and maintained by a state, its political subdivisions, or any
   agency or instrumentality of a state or its political subdivisions, for the
   benefit of its employees, and such plan has total assets in excess of
   $5,000,000; an employee benefit plan within the meaning of the Employee
   Retirement Income Security Act of 1974, if the investment decision is made by
   a plan fiduciary, as defined in Section 3(21) of such Act, which is either a
   bank, savings and loan association, insurance company, or registered
   investment adviser, or if the employee benefit plan has total assets in
   excess of $5,000,000 or, if a self-directed plan, with investment decisions
   made solely by persons that are "accredited investors";

 *     a private business development company as defined in Section
   202(a) (22) of  the Investment Advisers Act of 1940;

 * 
       an organization described in Section 501(c)(3) of the Internal Revenue
   Code, corporation, Massachusetts or similar business trust, or partnership,
   not formed for the specific purpose of acquiring the securities offered, with
   total assets in excess of $5,000,000;

 *     a natural person whose individual net worth, or joint net worth with the
   undersigned's spouse, at the time of this purchase exceeds $1,000,000;

 *     a natural person whose individual net worth, or joint net worth with the
   undersigned's spouse, at the time of this purchase exceeds $1,000,000;

 *     a natural person who had an individual income in excess of $200,000 in
   each of the two most recent years or joint income with the undersigned's
   spouse in excess of $300,000 in each of those years and has a reasonable
   expectation of reaching the same income level in the current year;

 *     a trust with total assets in excess of $5,000,000, not formed for the
   specific purpose of  acquiring the securities offered, whose purchase is
   directed by a person who has

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      offered, whose purchase is directed by a person who has such knowledge and
experience in financial and business matters that he is capable of evaluating
the merits and risks of the prospective investment;

 

 *          an entity in which all of the equity holders are "accredited
   investors" by virtue of their meeting one or more of the above standards; or

 
 *      an individual who is a director or executive officer of The Savannah
   Bancorp, Inc.

 

 

 

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: _______________________

 

 
 
 
 
 

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Exhibit C

 

PLAN OF DISTRIBUTION

    As of the date of this prospectus, we have not been advised by the selling
stockholders as to any plan of distribution.  Shares owned by the selling
stockholders, or by their partners, pledgees, donees (including charitable
organizations), transferees or other successors in interest, may from time to
time be offered for sale either directly by such individual, or through
underwriters, dealers or agents or on any exchange on which the shares may from
time to time be traded, in the over-the-counter market, or in independently
negotiated transactions or otherwise.  The methods by which the shares may be
sold include:

·        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;

·        exchange distributions and/or secondary distributions;

·        sales in the over-the-counter market;

·        underwritten transactions;

·         ordinary brokerage transactions and transactions in which the broker
solicits purchasers; and

·         privately negotiated transactions.

    Such transactions may be effected by the selling stockholders at market
prices prevailing at the time of sale or at negotiated prices.  The selling
stockholders may effect such transactions by selling the common stock to
underwriters or to or through broker-dealers, and such underwriters or
broker-dealers may receive compensations in the form of discounts or commissions
from the selling stockholders and may receive commissions from the purchasers of
the common stock for whom they may act as agent.  The selling stockholders may
agree to indemnify any underwriter, broker-dealer or agent that participates in
transactions involving sales of the shares against certain liabilities,
including liabilities arising under the Securities Act.  We have agreed to
register the shares for sale under the Securities Act and to indemnify the
selling stockholders, certain representatives of the selling stockholders and
each person who participates as an underwriter in the offering of the shares
against certain civil liabilities, including certain liabilities under the
Securities Act.

    In connection with sales of the common stock under this prospectus, the
selling stockholders may enter into hedging transactions with broker-dealers,
who may in turn engage in short sales of the common stock in the course of
hedging the positions they assume.  The selling stockholders also may sell
shares of common stock short and deliver them

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 to close out the short positions, or loan or pledge the shares of common stock
to broker-dealers that in turn may sell them.

    The selling stockholders and any underwriters, dealers or agents that
participate in distribution of the shares may be deemed to be underwriters, and
any profit on sale of the shares by them and any discounts, commissions or
concessions received by any underwriter, dealer or agent may be deemed to be
underwriting discounts and commissions under the Securities Act.

    There can be no assurances that the selling stockholders will sell any or
all of the shares offered under this prospectus.

         

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

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