<PAGE> 1
AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON APRIL 6, 1999
REGISTRATION NO. 333-
================================================================================
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
-----------------------------------
FORM SB-2
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
-----------------------------------
SATILLA FINANCIAL SERVICES, INC.
(Name of Small Business Issuer in Its Charter)
GEORGIA 6712 58-2434925
(State or other Jurisdiction of (Primary Standard Industrial (I.R.S. Employer
Incorporation or Organization) Classification Code Number) Identification No.)
RODNEY E. BENNETT
180 MARINERS DRIVE 180 MARINERS DRIVE
KINGSLAND, GEORGIA 31548 KINGSLAND, GEORGIA 31548
TELEPHONE: (912) 882-4775 TELEPHONE: (912) 882-4775
FACSIMILE: (912) 882-1780 FACSIMILE: (912) 882-1780
(Address, including zip code, and (Name, address, including zip code
telephone number, including area code, and telephone number,
of the registrant's principal including area code,
executive offices) of agent for service)
Copies to:
RALPH F. MACDONALD, III
MARK C. KANALY
ALSTON & BIRD LLP
ONE ATLANTIC CENTER
1201 WEST PEACHTREE STREET
ATLANTA, GEORGIA 30309-3424
TELEPHONE: (404) 881-7000
FACSIMILE: (404) 881-4777
-----------------------------------
APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE TO PUBLIC: As soon as
practicable after the effectiveness of this registration statement.
If this form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act, check the following box and
list the Securities Act registration statement number of the earlier effective
registration statement for the same offering. [ ] ___________________
If this form is a post-effective amendment filed pursuant to Rule 462(c)
under the Securities Act, check the following box and list the Securities Act
registration number of the earlier effective registration statement for the same
offering. [ ] ___________________
If this form is a post-effective amendment filed pursuant to Rule 462(d)
under the Securities Act, check the following box and list the Securities Act
registration number of the earlier effective registration statement for the same
offering. [ ] ___________________
If delivery of the prospectus is expected to be made pursuant to Rule 434,
please check the following box. [ ]
-----------------------------------
CALCULATION OF REGISTRATION FEE
<TABLE>
<CAPTION>
- ----------------------------------------------------------------------------------------------------------------------------
PROPOSED MAXIMUM PROPOSED MAXIMUM
AMOUNT TO BE OFFERING PRICE AGGREGATE AMOUNT OF
TITLE OF EACH CLASS OF SECURITIES TO BE REGISTERED REGISTERED (1) PER SHARE (1) OFFERING PRICE REGISTRATION FEE
- ----------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Common Stock, $.01 par value per share.......... 550,000 Shares $10.00 $5,500,000 $1,529
Organizers' Warrants to purchase an aggregate of
100,000 Shares of Common Stock............... 100,000 Warrants $0 $0 $0
Common Stock, $.01 par value per share, issuable
upon exercise of the Organizers' Warrants.... 100,000 Shares $10.00 $1,000,000 $278
Total Registration Fee.......................... $1,807
============================================================================================================================
</TABLE>
(1) Estimated solely for purposes of calculating the registration fee pursuant
to Rule 457(e).
-----------------------------------
THE REGISTRANT HEREBY AMENDS THIS REGISTRATION STATEMENT ON SUCH DATE OR
DATES AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE REGISTRANT SHALL
FILE A FURTHER AMENDMENT WHICH SPECIFICALLY STATES THAT THIS REGISTRATION
STATEMENT SHALL THEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH SECTION 8(A) OF
THE SECURITIES ACT OF 1933, AS AMENDED, OR UNTIL THE REGISTRATION STATEMENT
SHALL BECOME EFFECTIVE ON SUCH DATE AS THE COMMISSION, ACTING PURSUANT TO SAID
SECTION 8(A), MAY DETERMINE.
<PAGE> 2
THE INFORMATION IN THIS PROSPECTUS IS NOT COMPLETE AND MAY BE CHANGED.
WE MAY NOT SELL THESE SECURITIES UNTIL THE REGISTRATION STATEMENT FILED WITH THE
SECURITIES AND EXCHANGE COMMISSION IS EFFECTIVE. THIS PROSPECTUS IS NOT AN OFFER
TO SELL THESE SECURITIES AND IS NOT SOLICITING AN OFFER TO BUY THESE SECURITIES
IN ANY STATE WHERE THE OFFER OR SALE IS NOT PERMITTED.
<PAGE> 3
PROSPECTUS SUBJECT TO COMPLETION, DATED APRIL 6, 1999
[LOGO]
SATILLA FINANCIAL SERVICES, INC.
A PROPOSED HOLDING COMPANY FOR
SATILLA COMMUNITY BANK
(IN ORGANIZATION)
COMMON STOCK
MINIMUM OFFERING -- 450,000 SHARES
MAXIMUM OFFERING -- 550,000 SHARES
ORGANIZER WARRANTS
TO PURCHASE UP TO 100,000 SHARES OF COMMON STOCK
----------------------------
We are offering for sale to the general public a minimum of 450,000 shares
and a maximum of 550,000 shares of our common stock at a price of $10.00 per
share. You must purchase at least 200 shares to participate in this offering. If
we do not receive subscriptions for at least 450,000 shares, or if we or Satilla
Community Bank do not obtain the regulatory approvals required for our
formation, we will terminate this offering and return all subscription funds
plus interest, if any, to subscribers.
We are also offering, to our organizers only, organizer warrants to
purchase an aggregate of 100,000 shares of our common stock. We are offering the
organizer warrants to our organizers on a pro rata basis, based upon the number
of shares of our common stock that they purchase in this offering.
This is the initial public offering of our common stock, and there is
currently no public market for our common stock. The market price of our common
stock after this offering may be higher or lower than the public offering price.
No underwriters are involved in this offering, and we presently do not intend to
apply for listing of our common stock on any national securities exchange or on
the Nasdaq Stock Market.
INVESTING IN OUR COMMON STOCK IS SPECULATIVE AND INVOLVES A HIGH DEGREE OF
RISK. SEE "RISK FACTORS" BEGINNING ON PAGE 6 OF THIS PROSPECTUS.
<TABLE>
<CAPTION>
ESTIMATED PROCEEDS TO
PRICE TO PUBLIC EXPENSES* SATILLA
--------------- --------- -------
<S> <C> <C> <C>
Per Share $ 10.00 $ .22 $ 9.78
Minimum Offering (450,000 shares) $4,500,000 $100,000 $4,400,000
Maximum Offering (550,000 shares) $5,500,000 $100,000 $5,400,000
</TABLE>
- -------------
* Includes legal, accounting, printing and postage costs related to this
offering. Per share data assumes completion of the minimum offering.
- --------------------------------------------------------------------------------
OUR COMMON STOCK IS NOT A DEPOSIT AND IS NOT INSURED BY THE FDIC OR ANY
GOVERNMENTAL AGENCY. NEITHER THE SECURITIES AND EXCHANGE COMMISSION, THE FDIC
NOR ANY STATE SECURITIES COMMISSION HAS APPROVED OR DISAPPROVED OUR COMMON STOCK
OR PASSED UPON THE ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION
TO THE CONTRARY IS A CRIMINAL OFFENSE.
- --------------------------------------------------------------------------------
April ___, 1999
<PAGE> 4
[PICTURES AND NAMES OF ORGANIZERS]
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IMPORTANT NOTICE ABOUT INFORMATION IN THIS PROSPECTUS
You should rely only on the information contained in this prospectus. We
have not authorized anyone to provide you with different information. We are not
making an offer of our common stock in any state where the offer is not
permitted. You should not assume that the information contained in this
prospectus is accurate as of any date later than April ___, 1999.
This prospectus contains forward-looking statements which involve risks and
uncertainties. You can identify these forward-looking statements through our use
of words such as "may," "intend," "will," "expect," "anticipate," "believe,"
"estimate," "continue," or other similar words. Our actual results may differ
significantly from the results we discuss in these forward-looking statements,
especially since we are a new company with no operations. Factors that might
cause such a difference include, but are not limited to: our growth and our
ability to maintain growth; governmental monetary and fiscal policies, as well
as legislative and regulatory changes; the effect of interest rate changes on
our level and composition of deposits, loan demand and the value of our loan
collateral and securities; the effects of competition from other financial
institutions operating in our market area and elsewhere, including institutions
operating locally, regionally, nationally and internationally, together with
competitors that offer banking products and services by mail, telephone and
computer and/or the Internet; the failure of assumptions underlying the
establishment of our allowance for loan losses, including the value of
collateral underlying delinquent loans; and those factors discussed in "Risk
Factors" beginning on page 6 of this prospectus.
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PROSPECTUS SUMMARY
The following is a summary of the contents of this prospectus. It does not
contain all the information that may be important to you. You should read the
entire prospectus carefully before making any decision to invest in our common
stock.
SATILLA FINANCIAL SERVICES
We are a Georgia corporation that will become a bank holding company for
Satilla Community Bank, which is currently being organized as a
Georgia-chartered commercial bank. We are not yet an operating company and we
have engaged only in organizational activities to date.
We expect to conduct all our banking activities through Satilla Community
Bank. Our principal business will be to accept a variety of deposits from the
general public, and we will use these funds to make business, consumer,
mortgage, and other loans and extensions of credit.
OUR MARKET AREA AND STRATEGY
Our primary market area will be Brantley County and Camden County, Georgia.
We will also serve certain nearby areas of Charlton, Glynn, Pierce, and Ware
Counties in Georgia and Nassau County in Florida. These markets are primarily
served by branches of large regional and national financial institutions
headquartered outside of the area. As a result, we believe these markets need a
locally-owned and operated financial institution managed by people in and from
the communities served.
We believe that we will be able to offer personalized and flexible banking
services to the communities in our market area and that we will be able to react
quickly to changes in those communities. We also intend to offer products
tailored to the specific needs of our communities.
OUR CURRENT STATUS AND BUSINESS PLAN
We have filed, on behalf of Satilla Community Bank, an application with the
Georgia Department of Banking and Finance for a state bank charter and an
application with the FDIC for federal deposit insurance. Our applications are
pending and have not yet been approved. We will also file applications with the
Federal Reserve and the Georgia Department of Banking and Finance to become a
bank holding company.
Once we obtain the necessary regulatory approvals, we will begin banking
operations with full-service offices located in St. Marys, Camden County,
Georgia and Nahunta, Brantley County, Georgia.
OUR ORGANIZERS AND MANAGEMENT
Our organizers are David L. Knox, Sr., Rodney E. Bennett, , M. Anthony
Ham, Curtis J. Tumlin, II, Robert T. Baird, Walter A. Bennett, Richard L.
Brandon, Cecily A. Hill, Wayne E. Knox, Sheila A. Meadows, Bill F. Raulerson,
and Steve E. Rawl. Our organizers will comprise our initial Board of Directors
and several of them will also serve as our officers. Collectively, our
organizers have more than 115 years of banking experience. Our organizers
represent local business persons and banking professionals, each having strong
ties and familiarity with our community.
We have identified qualified candidates to perform other management
positions. We will pool the talents and varied backgrounds of our organizers
with those of other select qualified persons in the banking industry to form an
effective management team.
In exchange for their contribution to our initial capital, we issued shares
of our common stock to each of the organizers as of December 30, 1998, at the
same price per share as the initial offering price. We issued 150 shares of our
common stock to each of David L. Knox and Rodney E. Bennett and 100 shares to
each of our other ten organizers, or a total of 1,300 shares to all of our
organizers.
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OUR PRINCIPAL EXECUTIVE OFFICES
Our principal executive offices will be located at 6308 Highway 40 East,
St. Marys, GA 31558, telephone number (912) 882-4775. Our temporary offices are
across Highway 40 at 180 Mariners Drive, Kingsland, Georgia 35418, at the same
telephone number.
THIS OFFERING
This is the initial public offering of our common stock. We are offering a
minimum of 450,000 shares and a maximum of 550,000 shares of our common stock to
the general public at a price of $10.00 per share. You must purchase at least
200 shares to participate in this offering. Unless we extend this offering, we
will terminate it on May __, 1999. We will use the proceeds of this offering to
capitalize Satilla Community Bank in satisfaction of regulatory requirements.
Our organizers currently intend to subscribe for approximately 110,000
shares of our common stock in this offering. We are offering, to our organizers
only, organizer warrants to purchase an aggregate of 100,000 shares. We are
offering the organizers warrants to our organizers on a pro rata basis, based
upon the number of shares of our common stock that they purchase in this
offering.
Our organizers may, but are not obligated to, purchase additional shares if
such purchases are necessary to complete the minimum offering, but we will not
issue organizer warrants to purchase an aggregate of more than 100,000 shares of
our common stock.
HOW TO PURCHASE SHARES
You may purchase shares of our common stock by completing the subscription
agreement that accompanies this prospectus and then returning it, together with
full payment for the shares you have agreed to purchase, to our escrow agent,
The Bankers Bank, Atlanta, Georgia at the address provided in "This Offering."
CONDITIONS OF THIS OFFERING
If we do not receive subscriptions and payment in full for at least 450,000
shares, or if we or Satilla Community Bank do not receive all the regulatory
approvals required for our formation, we will terminate this offering and The
Bankers Bank will return your subscription payment to you, together with
interest, if any.
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<PAGE> 8
RISK FACTORS
Your investment in our common stock is speculative and involves a high
degree of risk. You should carefully consider the following factors and the
other information we have included in this prospectus before deciding to
purchase our common stock.
YOU MAY LOSE YOUR TOTAL INVESTMENT
Due to the significant risks associated with an investment in the common
stock of a newly-formed company and bank, you should make sure, before
investing, that you are financially able to sustain a total loss of any funds
used to purchase our common stock. Our common stock is not a deposit, and will
not be insured by the FDIC or any other government agency.
WE HAVE NO OPERATING HISTORY
We do not have an operating history. As a result, we are unable to provide
you with access to all of the information available to the investors of
well-established companies with operating histories.
WE MAY NOT BE PROFITABLE
As a result of the substantial start-up costs associated with forming a new
bank, we may not be profitable for several years after commencing business, if
ever. See "Plan of Operation."
WE MAY BE UNABLE TO COMPLETE THIS OFFERING
If we are unable to sell the minimum number of shares we are offering, or
if we cannot obtain all necessary regulatory approvals, we will terminate this
offering and return all subscription proceeds. In such case, we will not be able
to begin operations.
WE MAY BE UNABLE TO OBTAIN NECESSARY REGULATORY APPROVAL
We will not begin operations unless the Federal Reserve and the Georgia
Department of Banking and Finance approve our bank holding company applications,
the Georgia Department of Banking and Finance issues to us a state bank charter,
and the FDIC approves insurance for our bank's deposits. If we do not obtain
these approvals, we will not be able to begin operations.
WE MAY BE UNABLE TO MEET OUR CAPITAL NEEDS
We make no assurance that the proceeds from this offering will be
sufficient to support our initial operations, or that additional financing will
not be required in the future to meet our capital needs. Our organizers have no
commitments to provide additional funds for our operations if the proceeds of
this offering are insufficient.
WE ARE HIGHLY DEPENDENT UPON OUR ORGANIZERS AND PERSONNEL
We are highly dependent upon the personal efforts and abilities of our
organizers and our proposed initial Board of Directors and management team. If
any of our proposed directors or management personnel choose to leave, their
departure could delay the beginning of our operations and could adversely affect
our operations and the value of our common stock. Our ability to attract, hire,
and retain other qualified personnel for key management positions will affect
our profitability and success.
WE WILL BE SUSCEPTIBLE TO INTEREST RATE CHANGES
Our profitability will depend substantially upon our net interest income.
Net interest income is the difference between the interest earned on assets,
such as loans and investment securities, and the interest paid for liabilities,
such as savings and time deposits. Market interest rates for loans, investments,
and deposits are highly sensitive to many factors beyond our control. These
factors include competition, general economic conditions and the policies of
various government and regulatory authorities.
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<PAGE> 9
Changes in interest rates may cause significant changes (up or down) in our
net interest income. At any given time, our assets and liabilities will be
affected differently by a change in interest rates. Depending on our portfolio
of loans and investments, our profitability may be adversely affected by changes
in interest rates.
WE WILL HAVE LENDING RISKS
If our customers do not repay their loans in a timely manner, our earnings
and overall financial condition, as well as the value of our common stock, may
be adversely affected. We anticipate lending primarily to individuals and small-
to medium-sized businesses, which may expose us to greater lending risks than
those of banks lending to larger, better-capitalized businesses with longer
operating histories.
We intend to manage our credit exposure through careful monitoring of loan
applicants and loan concentrations in particular industries, and through loan
approval and review procedures. However, we will not be able to fully evaluate
the quality of our loan portfolio for several years because our loan portfolio
will be comprised entirely of new loans. Our ability to diversify our economic
risks will be limited by our own local markets and economies.
WE WILL FACE STRONG COMPETITION FROM LARGER, MORE ESTABLISHED COMPETITORS
The banking business is highly competitive and we will experience strong
competition from many other financial institutions. We will compete with
commercial banks, credit unions, savings and loan associations, mortgage banking
firms, consumer finance companies, securities brokerage firms, insurance
companies, money market funds and other financial institutions operating in our
primary market area and elsewhere.
We will compete with these institutions both in attracting deposits and in
making loans. In addition, we will have to attract our customer base from other
existing financial institutions and from new residents. Many of our competitors
are well-established and much larger financial institutions. While our
organizers believe we can successfully compete with these other financial
institutions in our markets, we may face a competitive disadvantage as a result
of our smaller size, limited resources and lack of geographic diversification.
Although we plan to compete by concentrating our marketing efforts in the
primary market area with local advertisements, personal contacts and greater
flexibility in working with local customers, we can give no assurance that this
strategy will be successful.
OUR PROPOSED MARKET AREA MAY NOT GROW
Our success will depend upon the growth in population, deposits and housing
starts in our primary market area, as well as the prevailing economy, interest
rates, deposit account growth and operating expense trends. If the communities
in our market area do not grow, or if prevailing economic conditions locally or
nationally are unfavorable, our business may not succeed. Moreover, we cannot
give any assurance that we will benefit from any market growth or favorable
economic conditions if they do occur.
WE WILL BE SUBJECT TO GOVERNMENT REGULATION, WHICH COULD CHANGE
We will operate in a highly regulated industry and will be subject to
examination, supervision and comprehensive regulation by various federal and
state agencies. Our compliance with these agencies will be costly and may limit
our growth and restrict certain of our activities, including, payment of
dividends, mergers and acquisitions, investments, loans and interest rates
charged, interest rates paid on deposits, and locations of offices. We will also
be subject to capitalization guidelines set forth in federal and state
legislation.
The laws and regulations applicable to the banking industry could change at
any time, and we cannot predict the impact of these changes on our business and
profitability. Because
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government regulation greatly affects the business and financial results of all
commercial banks and bank holding companies, our cost of compliance could
adversely affect our ability to operate profitably.
OUR COMMON STOCK HAS NO TRADING MARKET
Our common stock has no trading market, and we do not expect a trading
market to develop. You should be prepared to hold our common stock indefinitely.
You may be unable to sell your shares promptly or at a price equal to or above
the offering price. For these reasons, our common stock may not be appropriate
as a short-term investment.
WE ARBITRARILY DETERMINED THE OFFERING PRICE
Our organizers arbitrarily determined the offering price for our common
stock solely with a view to obtaining a broad distribution of the common stock
in our communities. The offering price may not reflect the actual market value
of our common stock. Following this offering, you may be unable to sell your
shares of our common stock at or above the offering price.
WE WILL NOT PAY DIVIDENDS IN THE FORESEEABLE FUTURE
We do not intend to pay dividends in the foreseeable future. We intend to
retain all future earnings, if any, to preserve our capital and to facilitate
our growth and expansion. Our payment of dividends will also be limited by legal
and regulatory restrictions. Our payment of cash dividends in the future will
depend on our earnings, capital requirements, financial condition, and other
factors considered relevant by our Board of Directors.
WE MAY DILUTE YOUR COMMON STOCK
Our common stock is not subject to any preemptive rights. Therefore, your
percentage ownership of our company will be diluted if we sell additional shares
of our common stock, if our organizers exercise their organizer warrants, and as
we grant stock awards, options or other awards to hire or retain employees.
WE MAY EXPERIENCE PROBLEMS AS A RESULT OF THE YEAR 2000 DATE CHANGE
We are aware of the computer hardware and software issues associated with
the Year 2000. Many computer programs that can only distinguish the final two
digits of the year entered are expected to improperly read entries for the Year
"2000" as the Year "1900."
Because we have not yet begun operations, we do not yet have any existing
computer hardware or software to evaluate and correct. We intend to carefully
evaluate all hardware and software for Year 2000 compliance before purchasing,
licensing, or leasing it from any third party. We are currently in the process
of reviewing computer hardware and software vendors, and Year 2000 capability is
a high priority in this review process. We intend to seek assurances of Year
2000 compliance from all our vendors and business customers.
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SATILLA FINANCIAL SERVICES
GENERAL
Satilla Financial Services, Inc. ("Satilla") was incorporated as a Georgia
corporation on December 18, 1998 for the purpose of becoming a bank holding
company by acquiring all of the capital stock of Satilla Community Bank (the
"Bank") upon its formation. The Bank is being organized as a Georgia commercial
bank with deposits insured by the Federal Deposit Insurance Corporation (the
"FDIC").
THE ORGANIZERS
The organizers of Satilla and the Bank (collectively, the "Organizers")
are David L. Knox, Sr., Rodney E. Bennett, M. Anthony Ham, Curtis J. Tumlin, II,
Robert T. Baird, Walter A. Bennett, Richard L. Brandon, Cecily A. Hill, Wayne E.
Knox, Sheila A. Meadows, Bill F. Raulerson, and Steve E. Rawl. All of the
Organizers will serve on the initial Board of Directors of both Satilla and the
Bank. David L. Knox, Sr., Chairman of Satilla and the Bank, and Rodney E.
Bennett, President and Chief Executive Officer of Satilla and the Bank,
collectively have over 65 years of banking experience, including former lending
responsibilities with several commercial banks.
REGULATORY STATUS
The Organizers filed an application for a bank charter with the Georgia
Department of Banking and Finance (the "Georgia Department") and an application
for insurance of the deposits of the Bank with the FDIC on December 30, 1998.
The Georgia Department and FDIC applications were deemed accepted as
informationally complete on December 30, 1998. Upon preliminary charter approval
by the Georgia Department, Satilla will file applications with the Board of
Governors of the Federal Reserve System (the "Federal Reserve") and the Georgia
Department seeking approval to become a bank holding company under the federal
Bank Holding Company Act of 1956, as amended (the "BHC Act"), and the Financial
Institutions Code of Georgia, as amended (the "Georgia Code").
The Organizers have chosen a holding company structure to afford Satilla
greater organizational, financial and transactional flexibility than would
otherwise be available. The holding company structure will assist the Bank in
maintaining its required capital ratios because, subject to compliance with
Federal Reserve debt guidelines, Satilla may borrow money and contribute the
proceeds to the Bank as primary capital. Moreover, a holding company may engage
in certain non-banking activities that the Federal Reserve has deemed to be
closely related to banking. Although Satilla has no present intention of
engaging in any of these activities, Satilla has the flexibility to commence
these activities upon filing a notice or application with the Federal Reserve.
See "Supervision and Regulation."
OFFICE FACILITIES
The principal executive offices of Satilla and the Bank will be located at
6308 Highway 40 East, St. Marys, GA 31558, telephone number (912) 882-4775.
Satilla's temporary offices are across Highway 40 at 180 Mariners Drive,
Kingsland, Georgia 35418, at the same telephone number.
The Bank initially will have one office located in Camden County and
another located in Brantley County. The Camden County office will be located at
the address of the Bank's principal executive offices, on approximately 1.25
acres, and the Brantley County office will be located at 113 East Cleveland
Street, Nahunta, Georgia 31553, on approximately 1.25 acres.
Satilla will construct the facilities for both Bank offices, each
consisting of two-story brick buildings with 6,000 square feet of office space.
Satilla expects to complete construction 180 to 270 days after this
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Offering, and neither Satilla nor the Bank will use any temporary facilities.
The estimated total cost for both offices, including land, construction and
furniture and equipment, will be approximately $2.2 million. The Organizers
believe these facilities will adequately serve the Bank's needs for its first
several years of operation.
EMPLOYEES
Satilla does not intend to have any employees other than its officers:
David L. Knox, Sr., Chairman, Rodney E. Bennett, President, M. Anthony Ham, Vice
President, and Curtis J. Tumlin, II, Secretary and Treasurer (the "Satilla
Officers"). The Organizers expect that the Bank will have approximately 28
full-time employees, including the Satilla Officers in their capacities as
officers of the Bank.
LEGAL PROCEEDINGS
As of the date of this Prospectus, there were no material legal proceedings
to which Satilla or the Bank or any of their properties were subject.
PROPOSED MARKET
MARKET AREA
The Bank will operate primarily in the Camden/Brantley County area as well
as other surrounding areas, including certain areas of Charlton, Glynn, Pierce,
and Ware Counties in Georgia and Nassau County in Florida. According to the U.S.
Census Bureau, the estimated population of Camden County increased from 31,107
in 1990 to 45,153 in 1997, representing growth of 49.7%. Similarly, the
estimated population of Brantley County increased from 11,077 in 1990 to 13,380
in 1997, representing growth of 20.8%. During the same period, the State of
Georgia's average population grew 15.6%. In 1993, the average income per
household in Camden County and Brantley County was $33,365 and $25,010,
respectively, while the average income per household for the State of Georgia
was $31,149.
Camden County's principal economic components are retail trade, tourism,
timber, manufacturing industries and a military base. Its largest employers
include the Kings Bay Naval Submarine Base, Gilman Paper Company, Camden County
Schools and Lockheed Missiles/Space Company. Camden County benefits from its
proximity to Jacksonville, Florida, which is only thirty miles away. One such
benefit has been the recent influx of residents who work in Jacksonville but
choose to commute from Camden County to avoid the congestion of the Jacksonville
metro area.
Brantley County's principal economic components are the timber and
manufacturing industries. Its largest employers include Okefenokee Rural
Electrical, Douglas Asphalt, Varn Wood Products and Georgia Pacific. Many
residents of Nahunta, Georgia commute to work in Camden and Glynn Counties, as
well as the Waycross, Georgia area.
Gilman Paper Company, which recently completed sales of certain of its
significant assets, may be in the process of downsizing. Any downsizing by
Gilman Paper Company, or by any of the principal employers in Camden County,
Brantley County or the surrounding areas could negatively affect the local
economy and Satilla's market area.
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MARKETING FOCUS
Currently, most banking facilities in the Camden/Brantley County area are
local branches of large regional and national banks with headquarters outside of
the Camden/Brantley County area. Although size gives the larger banks certain
advantages in competing for business from large corporations, including higher
lending limits and the ability to offer services in other areas outside the
Camden/Brantley County area, the Organizers believe that these institutions are
not focused on the consumer, professional and small- to medium-sized business
needs. As a result, the Bank generally will not attempt to compete for the
banking relationships of large corporations, but will concentrate its efforts on
small- to medium-sized businesses and on individuals, especially professionals.
The Bank plans to advertise through various media to emphasize Satilla's
local ownership, community focus and ability to provide more personalized,
flexible service than its competition. The Organizers, as long-time residents
and business people in the Camden/Brantley area, intend to also use their own
personal contacts and connections in the market area, along with those of the
other shareholders, to promote the Bank and to attract customers and business.
COMPETITION
As of December 31, 1998, there was one commercial bank with two offices
operating in Brantley County and there were five commercial banks with 10
branches operating in Camden County. These competitors are well-established in
the Camden/Brantley County area, and Satilla must compete with them for
customers. Many of these competitors have substantially greater resources and
lending limits, larger branch networks and are able to offer a broader range of
products and services that Satilla and the Bank.
Recent federal legislation permits commercial banks to establish operations
nationwide, which may increase competition from out-of-state financial
institutions. Recent Georgia legislation facilitates the establishment of branch
banks across county lines in Georgia, which may increase competition from other
banks already operating in Georgia. In addition, on-line computer banking via
the Internet and telephone may also become an increasing source of competition
for community financial institutions such as the Bank. As a result of all these
competitive factors, the Bank may initially have to pay higher rates of interest
to attract deposits and charge lower rates of interest on loans to attract
lending business.
PROPOSED BUSINESS
GENERAL
Satilla initially will engage in no business other than owning and managing
the Bank. The Bank will engage in a general commercial and retail banking
business, emphasizing the needs of small- to medium-sized businesses,
professional concerns and individuals. The Bank will accept deposits and
originate residential mortgage loans, home equity loans, consumer installment,
commercial real estate and commercial loans. The Bank intends to supplement its
portfolio of loans with investment securities deemed prudent by its Board of
Directors. Upon regulatory approval, the Bank will seek to attract deposits by
offering a money market deposit account, a checking account, a savings account,
a NOW account and various certificates of deposit products.
11
<PAGE> 14
DEPOSITS
The Bank intends to offer deposit services that are typically available in
most banks and savings and loan associations, including several types of
checking accounts, NOW accounts, savings accounts and time deposits of various
types, ranging from money market deposit accounts to certificates of deposit.
Interest rates and terms will be tailored to the Bank's principal market area at
rates competitive with the local market. In addition, the Bank intends to offer
certain retirement account services, such as Individual Retirement Accounts
("IRAs"). All deposit accounts will be insured by the FDIC up to the maximum
amount allowed by law. The Bank intends to solicit these accounts from
individuals, businesses, associations, organizations and governmental
authorities.
LENDING ACTIVITIES
The Bank intends to emphasize a range of lending services, including real
estate, commercial and consumer loans. Consumer loans will include both
installment and term loans, and will include loans for automobiles, household
goods, education, boats and general personal expense.
To address the risks inherent in making loans, management will maintain an
allowance for loan losses based on, among other things, an evaluation of the
Bank's loan loss experience, the amount of past due and nonperforming loans,
current and anticipated economic changes and the values of certain loan
collateral. Based upon such factors, management will make various assumptions
and judgments about the ultimate collectibility of the loan portfolio and
provide an allowance for potential loan losses based upon a percentage of the
outstanding balances and for specific loans. However, because there are certain
risks that cannot be precisely quantified, management's judgment of the
allowance is necessarily approximate and imprecise. The adequacy and methodology
of the allowance for loan losses will be subject to regulatory examination and
compared to a peer group of financial institutions identified by the regulatory
agencies.
Real Estate Loans. The Organizers expect that one of the primary components
of the Bank's loan portfolio will be loans secured by first or second mortgages
on residential and commercial real estate. These loans will generally consist of
commercial real estate loans, construction and development loans and residential
real estate loans (including home equity and second mortgage loans). Interest
rates may be fixed or adjustable and the Bank will generally charge an
origination fee. The Bank will seek to manage credit risk in the commercial real
estate portfolio by emphasizing loans on owner-occupied office and retail
buildings where the loan-to-value ratio, established by independent appraisals,
does not exceed 80%. The Organizers presently anticipate that the loan-to-value
ratio for (i) first and second mortgage loans and (ii) construction loans
generally will not exceed 80% and 75%, respectively. In addition, the Bank may
require personal guarantees of the principal owners of the property.
The Bank may also originate mortgage loans for sale into the secondary
market, earning a fee, but avoiding the interest rate risk of holding long-term,
fixed-rate loans.
Commercial Loans. The Bank will make loans for commercial purposes in
various lines of business. The commercial loans will include both secured and
unsecured loans for working capital (including inventory and receivables), loans
for business expansion (including acquisition of real estate and improvements),
Small Business Administration ("SBA") loans for new businesses (as well as other
governmentally guaranteed business loans) and loans for purchases of equipment
and machinery. The Organizers anticipate that equipment loans will typically be
made for a term of five years or less at either fixed or variable rates, with
the loan fully amortized over the term and secured by the financed equipment.
Working capital loans will typically have terms not exceeding one year and will
usually be secured by accounts receivable, inventory or personal guarantees of
the principals of the business. Commercial loans will vary greatly depending
upon the circumstances and loan terms will be structured on a case-by-case basis
to better serve customer needs.
12
<PAGE> 15
Consumer Loans. The Bank will make a variety of loans to individuals for
personal and household purposes, including secured and unsecured installment and
term loans, home equity loans and lines of credit and unsecured revolving lines
of credit such as credit cards. The secured installment and term loans to
consumers will generally consist of loans to purchase automobiles, boats,
recreational vehicles, mobile homes and household furnishings, with the
collateral for each loan being the purchased property. The underwriting criteria
for home equity loans and lines of credit will generally be the same as applied
by the Bank when making a first mortgage loan, as described above, and home
equity lines of credit will typically expire 10 years or less after origination,
unless renewed or extended.
Loan Approval and Review. The Bank's loan approval policies will
provide for various levels of officer lending authority. When the amount of
aggregate loans to a single borrower exceeds an individual officer's lending
authority, the loan request will be considered and approved by an officer with a
higher lending limit or by the Loan Committee of the Board of Directors. The
Loan Committee will set the lending limits for the Bank's loan officers, and any
loan in excess of such lending limits must be approved by the Loan Committee.
The Bank will not make any loans to any director, officer or employee of the
Bank unless the loan is approved by the Bank's Board of Directors, or a
committee thereof, and is made on terms not more favorable to such person than
would be available to a person not affiliated with the Bank.
Lending Limit. Under the Georgia Code, the Bank may not loan to any one
borrower (including the borrower's related interests) an amount that exceeds 15%
of the Bank's statutory capital base unless such loan is approved by the Bank's
Board of Directors and unless the entire amount of the loan is secured by good
collateral or other ample security. In no event, however, may the aggregate
amount loaned to any borrower exceed 25% of the Bank's statutory capital base,
subject to certain exceptions relating to the type and adequacy of the
collateral for such loan. These limits will increase and decrease as the Bank's
statutory capital base increases and decreases. Initially, the Bank's legal
lending limit is estimated to be approximately $500,000 for unsecured loans and
approximately $1,000,000 for secured loans, based upon the completion of the
minimum offering of 450,000 shares.
The Bank likely will not have any internal policy restrictions concerning
loans to one borrower other than the limits imposed by the Georgia Code and
those relating to loans to affiliates. Unless the Bank is able to sell
participations in its loans to other financial institutions, the Bank will not
be able to meet all the lending needs of customers requiring aggregate
extensions of credit above these limits. As a result, the Organizers anticipate
that the Bank will sell some portion of the loans it originates, especially
residential first mortgage loans, in the secondary market, thereby affording the
Bank greater lending ability. See "Supervision and Regulation."
OTHER BANKING SERVICES
Other anticipated bank services include cash management services, safe
deposit boxes, travelers checks, direct deposits of payroll and social security
checks and automatic drafts for various accounts. The Organizers plan for the
Bank to become associated with a shared network of automated teller machines
("ATMs") that may be used by Bank customers throughout Florida, Georgia and
other regions. The Organizers do not intend for the Bank to exercise any trust
powers during its initial years of operation. The Bank may in the future offer a
full-service trust department, but cannot do so without the prior approval of
the Georgia Department.
13
<PAGE> 16
PLAN OF OPERATION
PRE-OPENING OPERATIONS
As of December 31, 1998, Satilla had total assets aggregating approximately
$28,430. These assets consisted of cash of $13,430 and other assets of $15,000.
Satilla's total liabilities at this date were $75,000 and consisted of amounts
due under land purchase options and Satilla's line of credit with The Bankers
Bank, Atlanta, Georgia (the "Line of Credit"). Prior to this offering, Satilla
had no material source of capital other than the Line of Credit. Satilla had a
shareholder's deficit of $46,570 at December 31, 1998.
Satilla had a net loss from July 1, 1998 through December 31, 1998 of
$59,570. This loss resulted from expenses incurred in connection with activities
related to the initial organization of Satilla and the Bank and includes
expenses incurred on behalf of Satilla by the Organizers prior to Satilla's
incorporation date. These activities included, without limitation, the
preparation and filing of various regulatory applications and the preparation
and filing of a registration statement for this Offering.
POST-OFFERING OPERATIONS; LIQUIDITY
Assuming that this Offering is successfully completed, Satilla's initial
activities will be devoted to organizing the Bank and opening and commencing the
business of the Bank. These organizational activities will include completing
all required steps for approval from the Georgia Department and the FDIC for a
Georgia commercial bank, purchasing, constructing, furnishing and equipping the
proposed facilities, hiring qualified personnel to work at the Bank, conducting
public relations activities on behalf of the Bank, developing prospective
business contacts for the Bank and Satilla and taking other actions necessary
for a successful opening of the Bank. Because Satilla is in an organizational
stage, it has had no operations from which to generate any revenues and will not
have any operating revenues until the Bank opens for business.
Because earnings on its assets, if any, are expected to be less than the
expenses incurred in connection with its origination activities and those of the
Bank, Satilla will incur a net loss through the date of the opening of the Bank.
In addition, Satilla anticipates incurring continuing operating losses during
the Bank's early stages of operations. A minimum of $4 million of the net
proceeds of this Offering will be used to capitalize the Bank, and the remainder
will be used to pay organizational expenses of Satilla and provide working
capital, including additional capital for Satilla and for investment in the
Bank, if needed. The Organizers believe that this amount will be sufficient to
fund the activities of the Bank in its initial stages of operation until the
Bank can generate sufficient income from operations to fund its activities on an
ongoing basis. In addition, the Organizers believe that income from the
operations of the Bank will be sufficient to fund the activities of Satilla on
an ongoing basis for at least five years. However, in the event the proceeds of
this Offering are insufficient to provide the minimum initial funding needed for
the Bank to begin operations, Satilla will have to seek alternative sources of
funding, which may include sales of additional shares of Common Stock.
Once the Bank opens, the largest component of Satilla's net income is
expected to be the Bank's net interest income, which is the difference between
the income earned on assets and interest paid on deposits and borrowings used to
support such assets. Net interest income is influenced by the rates earned on
Satilla's interest-earning assets, the rates paid on its interest-bearing
liabilities, the relative amounts of interest-earning assets and
interest-bearing liabilities, and the maturities and repricing characteristics
of its interest-earning assets and interest bearing liabilities. Because the
Bank may initially have to pay above average rates on deposits and charge below
average rates on loans to attract customers, Satilla's net interest income may
be less during the Bank's initial years of operation than that of its
competitors, until it can rely more upon a historical record of customer service
to attract business.
14
<PAGE> 17
YEAR 2000 CONSIDERATIONS
The Year 2000 issue is the result of potential problems with computer
systems or any equipment with computer chips that use dates that have been
stored as two digits rather than four (e.g., "99" for 1999). On January 1, 2000,
any clock or date recording mechanism, including date sensitive software, which
uses only two digits to represent the year may recognize a date using "00" as
the year 1900 rather than the year 2000 (the "Year 2000 Problem"). This could
result in system failures or miscalculations causing disruption of operations,
including, among other things, a temporary inability to process transactions,
send invoices or perform similar tasks.
Satilla and the Bank will rely upon computer software and hardware systems
to perform their operations, some of which will be managed internally by Satilla
and the Bank and others that will be provided by third-party vendors. Satilla is
aware of the Year 2000 Problem, and Satilla recognizes that the Year 2000
Problem, if not properly addressed, could have a material adverse effect on
Satilla, the Bank and the Bank's customers. Because Satilla and the Bank have
not yet begun operations, they do not presently have any existing computer
software or hardware to evaluate or fix. However, Satilla intends to evaluate
all hardware and software for Year 2000 compliance before purchasing, licensing,
leasing or contracting any equipment from third parties.
Satilla is currently in the process of reviewing software and hardware
vendors and is considering entering into a contract with The Intercept Group
("Intercept") to use its "PC BancPAC" data processing and item processing
banking systems. Satilla will seek assurances that Intercept's software and
hardware computer systems are, or will be, Year 2000 compliant. Satilla will not
begin operations until it has assurances that its computer software and hardware
systems are, or will be, Year 2000 compliant.
Satilla has not contracted with any independent source to analyze Satilla's
Year 2000 exposure, but believes that its exposure is manageable because it is
aware of the issues and will only use systems that it believes will be Year 2000
compliant. Satilla believes that its costs in addressing the Year 2000 issues
will be nominal since it will not have to replace or fix any existing computer
software programs or hardware.
Satilla has developed a "Year 2000 Project Plan" whereby a "Year 2000
Project Team" will be formed from the Bank's management and staff to address the
Year 2000 Problem. The Year 2000 Project Team is expected to evaluate all
software and hardware systems to determine compliance. After the Bank commences
operations, the Year 2000 Project Team is expected to monitor the Bank's own
systems, if any, and all third-party systems regularly to assess any risks to
Satilla and the Bank and to proactively work with third-party vendors to ensure
all Satilla's and Bank's systems are Year 2000 compliant. The Bank intends to
actively assess and monitor its Year 2000 exposure created when it loans money
to its customers.
Satilla is also developing a contingency plan in the event that its
computer systems do not properly handle the Year 2000 date change. Under the
plan, Satilla would hire experienced third party vendors to modify, update or
replace any of Satilla's computer systems that are unable to properly handle the
Year 2000 date change.
The Organizers are taking what they believe to be prudent and reasonable
steps to ensure that Satilla's and the Bank's computer systems, as well as those
of their proposed suppliers and customers, are Year 2000 compliant. However, if
such systems do not properly handle the Year 2000 date change, Satilla's and the
Bank's business, financial condition and results of operations could me
materially adversely effected.
15
<PAGE> 18
THIS OFFERING
GENERAL
Satilla is offering (this "Offering") for sale to the public a minimum of
450,000 shares (the "Minimum Offering") and a maximum of 550,000 shares (the
"Maximum Offering") of its common stock, par value $.01 per share (the "Common
Stock" or the "Shares"), at a purchase price of $10.00 per Share to raise gross
proceeds between $4,500,000 and $5,500,000. Subscribers must purchase at least
200 Shares to participate in this Offering, and any subscriptions for less than
200 Shares will be rejected and returned to the subscriber. This Offering will
terminate on May __, 1999 (the "Expiration Date"), unless extended by Satilla.
Satilla will deposit all of the subscription proceeds in an escrow account (the
"Escrow Account") with its escrow agent, The Bankers Bank, Atlanta, Georgia (the
"Escrow Agent"), pending the satisfaction of certain conditions prior to the
Expiration Date.
A Shareholder desiring to subscribe for Shares in this Offering must
deliver to Satilla before 5:00 P.M. Eastern Time on the Expiration Date a
completed Subscription Agreement and a check for full payment of the subscribed
Shares. Satilla reserves the right, in its sole discretion, to extend this
Offering past the Expiration Date for periods of up to 30 days each, but in no
case will Satilla provide additional notice to investors of any such extension.
CONDITIONS OF THIS OFFERING
This Offering is conditioned upon the satisfaction of the following events
prior to the Expiration Date:
1. Satilla has received and accepted subscriptions accompanied by full
payment in collected funds for at least 450,000 Shares; and
2. The Organizers have received, or expect to receive, as they may
determine in their sole discretion, adequate provisions for satisfying
any and all regulatory approvals, and have met, or expect to meet the
other conditions that must be satisfied before Satilla and the Bank may
begin banking operations.
In the event that the foregoing conditions are not each satisfied, Satilla
may, in its discretion, terminate this Offering and promptly return the
subscription proceeds to subscribers. However, Satilla reserves the right to
terminate this Offering at any time and for any reason without further notice to
investors.
HOW TO SUBSCRIBE
Each person who desires to purchase Common Stock should:
1. Complete, date, and execute the Subscription Agreement to purchase at
least 200 Shares, and also sign the Substitute Form W-9, accompanying
this Prospectus;
2. Make a check payable to "The Bankers Bank, Satilla Escrow Agent" in the
amount of $10.00 for each Share subscribed for in this Offering;
3. Mail or deliver the Subscription Agreement and check to:
Satilla Financial Services, Inc.
180 Mariners Drive
Kingsland, Georgia 31548
Attention: David L. Knox, Sr.
16
<PAGE> 19
4. Subscription Agreements and checks for the purchase of Common Stock
MUST be received by Satilla prior to 5:00 P.M. Eastern Time on
May __, 1999, unless this date is extended by Satilla in its sole
discretion.
HANDLING OF SUBSCRIPTIONS
Subscriptions are binding upon Satilla only if and to the extent accepted
by Satilla in writing. Satilla reserves the right, in its sole discretion, to
reject any subscription in whole or in part, to allocate Shares among
subscribers, and to withdraw, cancel or modify this Offering without notice.
Satilla will decide which subscriptions to accept within 14 days of receipt of
the completed Subscription Agreement and check. In determining which
subscriptions and oversubscriptions to accept, in whole or part, Satilla may
take into account various factors, including a subscriber's potential to do
business with, or refer customers to, the Bank and the order in which the
subscriptions were received.
In the event Satilla rejects all or a portion of any subscription, Satilla
will promptly refund by mail to the subscriber all or the appropriate portion of
the amount remitted with the subscription, without interest. Upon rejection of a
subscription or the termination or expiration of this Offering, Satilla and its
directors, officers, employees, agents, representatives, and affiliates will
have no further liability to the subscribers whose subscriptions are being
rejected once all appropriate refunds have been mailed to the address shown in
the Subscription Agreement.
Satilla will confirm all sales of Common Stock in writing. Certificates
representing Shares of Common Stock duly subscribed and fully paid will be
issued by Satilla's registrar and transfer agent promptly after Satilla's
acceptance of the subscriptions and the issuance of a confirmation therefor.
ESCROW ACCOUNT
All subscription funds will be deposited in the Escrow Account pending
completion of this Offering. Funds in the Escrow Account may not be reached by
creditors of the Organizers, Satilla or the Bank, and will only be released to
Satilla once this Offering has been successfully completed. If this Offering is
not successfully completed, the Escrow Agent will return all subscription funds
plus interest, if any, to subscribers.
PARTICIPATION BY ORGANIZERS; ORGANIZER WARRANTS
The Organizers presently intend to purchase approximately 110,000 shares of
Satilla's Common Stock in this Offering, equal to approximately 24.5% of the
Minimum Offering or 20.0% of the Maximum Offering. The Organizers will purchase
their Shares at a price of $10.00 per Share, the same price at which Shares are
being offered to the public.
In addition to the Common Stock, Satilla is also offering, to the
Organizers only, warrants (the "Organizer Warrants") to purchase an aggregate of
100,000 shares of Satilla's Common Stock. The Organizer Warrants are being
offered to the Organizers in consideration of their efforts in organizing
Satilla and the Bank, their guarantee of the Line of Credit and their investment
in Satilla. The number of Shares to be the subject of each Organizer Warrant
will be determined on a pro rata basis, based upon the number of Shares
purchased by such Organizer in this Offering. For example, assuming that the
Organizers purchase an aggregate of 110,000 Shares in this Offering, an
Organizer who purchases 11,000, or 10%, of such Shares would receive an
Organizer Warrant to purchase 10,000, or 10%, of the 100,000 Shares that will be
the subject of the Organizer Warrants.
17
<PAGE> 20
The terms and conditions of each Organizer Warrant are identical. The
Organizers' rights under the Organizer Warrants will become fully vested upon
the later of the termination of this Offering or the opening of the Bank (such
date, the "Vesting Date"), and each Organizer Warrant will become fully
exercisable three years after the date of the Vesting Date. The Organizer
Warrants will expire on December 31, 2009. The Organizer Warrants are
non-transferable.
The Organizers may, but are not obligated to, purchase additional Shares if
such purchases are necessary to complete the Minimum Offering, but in no event
will the Organizers receive Organizer Warrants to purchase greater than an
aggregate of 100,000 Shares.
18
<PAGE> 21
PLAN OF DISTRIBUTION
Offers and sales of the Common Stock will be made on behalf of Satilla by
certain of its officers and directors. The officers and directors will receive
no commissions or other remuneration in connection with such activities, but
they may be reimbursed for any reasonable expenses incurred in connection with
this Offering.
MARKET INFORMATION AND DIVIDENDS
Satilla has not previously issued any of its Common Stock to the public. As
a result, there is no market for the Common Stock and an active trading market
may not develop in the foreseeable future. There are no present plans for the
Common Stock to be listed or qualified for trading on any stock exchange or on
Nasdaq. Satilla presently anticipates seeking at least one independent over the
counter market makers in the Common Stock.. However, there is no assurance that
any party will make a market in the Common Stock now or at any time in the
future, or if any party does become a market maker, that they will continue to
do so.
Because Satilla and the Bank are both start-up operations, it will be the
policy of Satilla's Board of Directors to retain any earnings for the period of
time necessary to ensure the success of their operations. The payment of
dividends by Satilla in the future will depend substantially upon the Bank's
earnings, if any, and will be subject to legal and regulatory restrictions
applicable to Satilla and the Bank. As a result, Satilla does not intend to pay
dividends in the foreseeable future, and its future dividend policy will depend
on the Bank's earnings, capital requirements, financial condition and other
factors considered relevant by Satilla's Board of Directors.
USE OF PROCEEDS
The estimated net proceeds to Satilla from this Offering are set forth in
the table below:
<TABLE>
<CAPTION>
MINIMUM MAXIMUM
OFFERING OF OFFERING OF
450,000 SHARES 550,000 SHARES
-------------- --------------
<S> <C> <C>
Gross Proceeds from this Offering $4,500,000 $5,500,000
Estimated Offering Expenses $ 100,000 $ 100,000
---------- ----------
Net Proceeds ............... $4,400,000 $5,400,000
========== ==========
</TABLE>
Of the net proceeds from this Offering, Satilla will use (i) approximately
$4 million to purchase 100% of the capital stock of the Bank, thereby
capitalizing the Bank in satisfaction of regulatory requirements, (ii)
approximately $105,000 to repay the Line of Credit, which has been used to pay
organizational expenses, and (iii ) the remaining approximately $325,000
(assuming the completion of the Minimum Offering) for general corporate
purposes.
The Organizers presently expect that, of the approximately $4 million that
Satilla will contribute to the Bank, the Bank will use (i) approximately $2.2
million to purchase the land for, construct, furnish and equip the Bank's
Brantley County and Camden County offices, and (ii) the remaining $1.8 million
for the Bank's working capital and for general corporate purposes, including
making loans and investments. Such amounts may be paid directly by the Bank or
indirectly to acquire such property from Satilla at cost, including repayment of
loans and interest incurred to acquire such properties for the Bank.
19
<PAGE> 22
Satilla established the Line of Credit on September 30, 1998 to pay certain
organizational, offering and pre-opening expenses of Satilla and the Bank,
including, without limitation, consulting fees for market analysis and
feasibility studies, legal and accounting fees and expenses, filing fees,
printing expenses, marketing costs and costs associated with the preparation of
the Bank's offices. The interest rate on the Line of Credit is a variable
interest rate that is equal to the Prime Rate, as published in the Money Rates
section of The Wall Street Journal. At origination, the interest rate for the
Line of Credit was 8.500%. As of March 9, 1999, the principal balance
outstanding under the Line of Credit was approximately $105,000 and the interest
rate for such amount was 8.500%. The Line of Credit is guaranteed jointly and
severally by the Organizers and matures on September 30, 1999.
CAPITALIZATION
The table below sets forth the capitalization of Satilla on December 31,
1998, (i) on an actual basis, and (ii) on an as adjusted basis to reflect the
sale of the Common Stock offered by this Prospectus and the application of the
net proceeds therefrom as set forth herein under "Use of Proceeds." This table
should be read in conjunction with "Use of Proceeds," "Plan of Operation" and
the Consolidated Financial Statements and Notes thereto included elsewhere in
this Prospectus.
<TABLE>
<CAPTION>
DECEMBER 31, 1998
------------------------------------------------------
AS ADJUSTED
-------------------------------------
MINIMUM MAXIMUM
OFFERING OF OFFERING OF
ACTUAL 450,000 SHARES 550,000 SHARES
-------- -------------- --------------
<S> <C> <C> <C>
Common Stock, par value $.01 per share, 2,000,000
shares authorized, 1,300 shares outstanding; 451,300
(Minimum Offering) and 551,300 (Maximum Offering)
shares outstanding (1) ................................ $ 13 $ 4,513 $ 5,513
Preferred Stock, par value $.01 per share, 500,000 shares
authorized; no shares issued or outstanding ........... -- -- --
Additional paid-in capital ............................... 12,987 4,508,487 5,507,487
Deficit accumulated during the pre-opening and development
stage ................................................. -- -- --
(59,570) (59,570) (59,570)
-------- ----------- -----------
Total shareholders' equity (Deficit) ..................... $(46,570) $ 4,453,430 $ 5,453,430
======== =========== ===========
</TABLE>
- -----------------
(1) Includes 1,300 Shares that were issued, at the same price as the initial
offering price, to the Organizers as of December 30, 1998 in exchange for
their initial capital contribution, but excludes an aggregate of 100,000
Shares that will be subject to the Organizer Warrants.
20
<PAGE> 23
SUPERVISION AND REGULATION
Bank holding companies and banks are extensively regulated under both
federal and state law. The following discussion summarizes certain statutes,
rules and regulations affecting Satilla and the Bank. This summary is qualified
in its entirety by reference to the statutory and regulatory provisions referred
to below and elsewhere herein and is not intended to be an exhaustive
description of the statutes or regulations applicable to Satilla's and the
Bank's businesses. Any change in the applicable law or regulations may have a
material effect on the business of Satilla and the Bank. Supervision, regulation
and examination of banks by the bank regulatory agencies are intended primarily
for the protection of depositors rather than holders of Satilla's Common Stock.
BANK HOLDING COMPANY REGULATION
General. Satilla will be a bank holding company within the meaning of the
Bank Holding Company Act of 1956, as amended (the "BHC Act"). As a bank holding
company registered with the Federal Reserve under the BHC Act and with the
Georgia Department under the Georgia Code, Satilla will be subject to
supervision, examination and reporting by the Federal Reserve and the Georgia
Department. Satilla's activities will be limited to banking, managing or
controlling banks, furnishing services to or performing services for its
subsidiaries, or engaging in any other activity that the Federal Reserve
determines to be so closely related to banking or managing or controlling banks
as to be a proper incident thereto.
Satilla will be required to file with the Federal Reserve its periodic
reports and such additional information as the Federal Reserve may require. The
Federal Reserve will regularly examine Satilla and may examine its subsidiaries
including the Bank. The Georgia Department also may examine Satilla.
Investment Activities. The BHC Act requires prior Federal Reserve approval
for, among other things, the acquisition by a bank holding company of direct or
indirect ownership or control of more than 5% of the voting shares or
substantially all of the assets of any bank, or for a merger or consolidation of
a bank holding company with another bank holding company. A bank holding company
may acquire direct or indirect ownership or control of voting shares of any
company that is engaged directly or indirectly in banking or managing or
controlling banks or performing services for its authorized subsidiaries. A bank
holding company may, however, engage in or acquire an interest in a company that
engages in activities which the Federal Reserve has determined by regulation or
order to be so closely related to banking as to be a proper incident thereto.
Under the BHC Act, Satilla will be generally prohibited from engaging in,
or acquiring direct or indirect control of more than 5% of the voting shares of
any company engaged in non-banking activities, unless the Federal Reserve, by
order or regulation, has found those activities to be so closely related to
banking or managing or controlling banks as to be a proper incident thereto.
Some of the activities that the Federal Reserve has determined by regulation to
be proper incidents to the business of banking include making or servicing loans
and certain types of leases, engaging in certain insurance and discount
brokerage activities, performing certain data processing services, acting in
certain circumstances as a fiduciary or investment or financial advisor, owning
savings associations, and making investments in certain corporations or projects
designed primarily to promote community welfare.
In addition, and subject to certain exceptions, the BHC Act and the Change
in Bank Control Act, together with regulations thereunder, require Federal
Reserve approval (or, depending on the circumstances, no notice of disapproval)
prior to any person or company acquiring "control" of a bank holding company.
Control is conclusively presumed to exist if an individual or company acquires
25% or more of any class of voting securities of the bank holding company.
21
<PAGE> 24
The BHC Act, as amended by the interstate banking provisions of the
Riegle-Neal Interstate Banking and Branching Efficiency Act of 1994 (the
"Interstate Banking Act"), repealed the prior statutory restrictions on
interstate acquisitions of banks by bank holding companies, such that any bank
holding company located in the State of Georgia may acquire a bank located in
any other state, and any bank holding company located outside Georgia may
lawfully acquire any bank based in another state, regardless of state law to the
contrary, in either case subject to certain deposit-percentage, aging
requirements, and other restrictions. The Interstate Banking Act also generally
provides that national and state-chartered banks may branch interstate through
acquisitions of banks in other states. By adopting legislation prior to that
date, a state has the ability either to "opt in" and accelerate the date after
which interstate branching is permissible or "opt out" and prohibit interstate
branching altogether. In March 1996, the Georgia legislature adopted legislation
opting into interstate branching effective June 1, 1997.
The Economic Growth and Regulatory Paperwork Reduction Act of 1996
("EGRPRA") streamlined the non-banking activities application process for
well-capitalized and well-managed bank holding companies. Under EGRPRA,
qualified bank holding companies may commence a regulatory approved non-banking
activity without prior notice to the Federal Reserve; written notice is required
within 10 days after commencing the activity. Under EGRPRA, the prior notice
period is reduced to 12 days in the event of any non-banking acquisition or
share purchase or de novo non-banking activity previously approved by order of
the Federal Reserve, but not yet implemented by regulations, assuming the size
of the acquisition or proposed activity does not exceed 10% of risk-weighted
assets of the acquiring bank holding company and the consideration does not
exceed 15% of Tier 1 Capital.
In 1997, the Federal Reserve adopted amendments to its Regulation Y
implementing certain provisions of EGRPRA. Among other things, these amendments
to Federal Reserve Regulation Y reduce the notice and application requirements
applicable to bank and non-bank acquisitions and de novo expansion by
well-capitalized and well managed holding companies; expand the list of
non-banking activities permitted under Regulation Y and reduce certain
limitations on previously permitted activities; and amend Federal Reserve
anti-tying restrictions to allow banks greater flexibility to package products
with their affiliates.
Source of Financial Strength. Federal Reserve policy requires a bank
holding company to act as a source of financial strength and to take measures to
preserve and protect bank subsidiaries in situations where additional
investments in a troubled bank may not otherwise be warranted. In addition,
under the Financial Institutions Reform, Recovery and Enforcement Act of 1989
("FIRREA"), where a bank holding company has more than one bank or thrift
subsidiary, each of the bank holding company's subsidiary depository
institutions are responsible for any losses to the FDIC as a result of an
affiliated depository institution's failure. As a result, a bank holding company
may be required to loan money to its subsidiaries in the form of capital notes
or other instruments which qualify as capital under regulatory rules. However,
any loans from the holding company to such subsidiary banks will likely be
unsecured and subordinated to such bank's depositors and perhaps to other
creditors of the bank.
Georgia Department. Satilla will also be regulated by the Georgia
Department. The Georgia Code requires annual registration with the Georgia
Department by all Georgia bank holding companies. Such registration includes
information with respect to the financial condition, operations and management
of intercompany relationships of the bank holding company and its subsidiaries
and related matters. The Georgia Department may also require such other
information as is necessary to keep itself informed as to whether the provisions
of Georgia law and the regulations and orders issued thereunder by the Georgia
Department have been complied with. The Georgia Code also requires prior Georgia
Department approval for the acquisition by a bank holding company of direct or
indirect ownership or control of more than 5% of the voting shares or
substantially all of the assets of any bank, for a merger or consolidation of a
bank holding company with another bank holding company, or for other similar
investment activities regulated by the BHC Act.
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<PAGE> 25
BANK REGULATION
General. As a Georgia bank whose deposits are insured by the FDIC's Bank
Insurance Fund ("BIF") maintained by the FDIC, the Bank will be subject to
regulation and examination by the Georgia Department and by its primary federal
regulator, the FDIC. The Georgia Department and the FDIC will regulate and
monitor all of the Bank's operations, including reserves, loans, mortgages,
payments of dividends, interest rates and the establishment of branches.
Interest and certain other charges collected or contracted for by the Bank will
be subject to state usury laws and certain federal laws concerning interest
rates.
Under the Federal Deposit Insurance Corporation Improvement Act of 1991
("FDICIA"), all insured institutions must undergo regular on-site examination by
their appropriate banking agency. The cost of examinations of insured depository
institutions and any affiliates may be assessed by the appropriate agency
against each institution or affiliate as it deems necessary or appropriate.
Insured institutions are required to submit annual reports to the FDIC and the
appropriate banking agency (and state supervisor when applicable). FDICIA also
directs the FDIC to develop with other appropriate agencies a method for insured
depository institutions to provide supplemental disclosure of the estimated fair
market value of assets and liabilities, to the extent feasible and practicable,
in any balance sheet, financial statement, report of condition or any other
report of any insured depository institution. FDICIA also requires the federal
banking regulatory agencies to prescribe, by regulation, standards for all
insured depository institutions and depository institution holding companies
relating, among other things, to: (i) internal controls, information systems,
and audit systems; (ii) loan documentation; (iii) credit underwriting; (iv)
interest rate risk exposure; and (v) asset quality.
Transactions With Affiliates and Insiders. The Bank will be subject to the
provisions of Section 23A of the Federal Reserve Act, which place limits on the
amount of loans or extensions of credit to, or investments in, or certain other
transactions with, affiliates and on the amount of advances to third parties
collateralized by the securities or obligations of affiliates. In addition, most
of these loans and certain other transactions must be secured in prescribed
amounts. The Bank will also be subject to the provisions of Section 23B of the
Federal Reserve Act that, among other things, prohibit an institution from
engaging in certain transactions with certain affiliates unless the transactions
are on terms substantially the same, or at least as favorable to such
institution or its subsidiaries, as those prevailing at the time for comparable
transactions with non-affiliated companies. The Bank will be subject to certain
restrictions on extensions of credit to executive officers, directors, certain
principal stockholders, and their related interests. Such extensions of credit
(i) must be made on substantially the same terms, including interest rates and
collateral, as those prevailing at the time for comparable transactions with
third parties, and (ii) must not involve more than the normal risk of repayment
or present other unfavorable features.
Branching. Our Organizers intend for the Bank to initially consist of two
offices, one in Camden County and one in Brantley County. All intra-state
branching restrictions have been removed as of July 30, 1998 pursuant to recent
Georgia legislation, and statewide banking is now permissible. Although the Bank
currently has no definitive plans for opening any other offices, depending on
profitability and community needs, other offices may be considered. Satilla,
with prior regulatory approval, will be permitted to acquire interest in and
operate banks throughout the State of Georgia. Under Georgia law, any bank
acquired by Satilla could be merged into the Bank and its offices could then be
operated as branch offices of the Bank. There are currently no plans for Satilla
to make any such acquisition.
Other Regulations. Interest and certain other charges collected or
contracted for by the Bank will be subject to state usury laws and certain
federal laws concerning interest rates. The Bank's loan operations will also be
subject to certain federal laws applicable to credit transactions, such as the
federal Truth-In-Lending Act governing disclosures of credit terms to consumer
borrowers, the Home Mortgage Disclosure Act of 1975 requiring financial
institutions to provide information to enable the public and public officials to
determine whether a financial institution is fulfilling its obligation to help
meet the housing needs of the
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<PAGE> 26
community it serves, the Equal Credit Opportunity Act prohibiting discrimination
on the basis of race, creed or other prohibited factors in extending credit, the
Fair Credit Reporting Act of 1978 governing the use and provision of information
to credit reporting agencies, the Fair Debt Collection Act governing the manner
in which consumer debts may be collected by collection agencies, and the rules
and regulations of the various federal agencies charged with the responsibility
of implementing such federal laws. The deposit operations of the Bank will also
be subject to the Right to Financial Privacy Act, which imposes a duty to
maintain confidentiality of consumer financial records and prescribes procedures
for complying with administrative subpoenas of financial records, and the
Electronic Funds Transfer Act and Regulation E issued by the Federal Reserve
Board to implement that act, which governs automatic deposits to and withdrawals
from deposit accounts and customers' rights and liabilities arising from the use
of automated teller machines and other electronic banking services.
ENFORCEMENT POLICIES AND ACTIONS
FIRREA and subsequent federal legislation significantly increased the
enforcement authorities of the FDIC and other federal depository institution
regulators, and authorizes the imposition of civil money penalties up to $1
million per day. Persons who are affiliated with depository institutions can be
removed from any office held in such institution and banned for life from
participating in the affairs of any such institution. The banking regulators
have not hesitated to use the new enforcement authorities provided under FIRREA.
DIVIDENDS
The principal source of Satilla's cash revenues will come from dividends
received from the Bank. The amount of dividends that may be paid by the Bank to
Satilla depends on the Bank's earnings and capital position and will be limited
by federal and state law, regulations, and policies. In addition, the Federal
Reserve has stated that bank holding companies should refrain from or limit
dividend increases or reduce or eliminate dividends under circumstances in which
the bank holding company fails to meet minimum capital requirements or in which
its earnings are impaired.
Cash dividends on the Bank's common stock may be declared and paid only out
of its retained earnings, and dividends may not be declared at any time at which
the Bank's paid-in capital and appropriated retained earnings do not, in
combination, equal at least 20% of its capital stock account. In addition, the
Georgia Department's current rules and regulations require prior Georgia
Department approval before cash dividends may be declared and paid if: (i) the
Bank's ratio of equity capital to adjusted total assets is less than 6%; (ii)
the aggregate amount of dividends declared or anticipated to be declared in that
calendar year exceeds 50% of the Bank's net profits, after taxes but before
dividends, for the previous calendar year; or (iii) the percentage of the Bank's
assets classified as adverse as to repayment or recovery by the Georgia
Department at the most recent examination of the Bank exceeds 80% of the Bank's
equity capital as reflected at such examination.
Under FDICIA, the Bank may not pay a cash dividend if, after paying the
dividend, the Bank would be undercapitalized. See "--Capital Regulations."
CAPITAL REGULATIONS
The federal bank regulatory authorities have adopted risk-based capital
guidelines for banks and bank holding companies that are designed to make
regulatory capital requirements more sensitive to differences in risk profile
among banks and bank holding companies, account for off-balance sheet exposure,
and minimize disincentives for holding liquid assets. The resulting capital
ratios represent qualifying capital as a percentage of total risk-weighted
assets and off-balance sheet items. The guidelines are minimums, and the federal
regulators have noted that banks and bank holding companies contemplating
significant expansion
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<PAGE> 27
programs should not allow expansion to diminish their capital ratios and should
maintain ratios well in excess of the minimums. The current guidelines require
all bank holding companies with consolidated assets in excess of $150 million
and federally regulated banks to maintain a minimum risk-based total capital
ratio equal to 8% of which at least 4% must be Tier 1 capital. Tier 1 capital
includes common stockholders equity, qualifying perpetual preferred stock, and
minority interest in equity accounts of consolidated subsidiaries, but excludes
goodwill and most other intangibles and excludes the allowance for loan and
lease losses. Tier 2 capital includes the excess of any preferred stock not
included in Tier 1 capital, mandatory convertible securities, hybrid capital
instruments, subordinated debt and intermediate term preferred stock, and
general reserves for loan and lease losses up to 1.25% of risk-weighted assets.
Small bank holding companies with less than $150 million in consolidated assets
are not separately evaluated from their bank subsidiaries for purposes of
determining capital adequacy, and only the subsidiary bank's capital is
considered.
Under these guidelines, banks' and bank holding companies' assets are given
risk-weights of 0%, 20%, 50%, or 100%. In addition, certain off-balance sheet
items are given credit conversion factors to convert them to asset equivalent
amounts to which an appropriate risk-weight will apply. These computations
result in the total risk-weighted assets. Most loans are assigned to the 100%
risk category, except for first mortgage loans fully secured by residential
property and, under certain circumstances, residential construction loans, both
of which carry a 50% rating. Most investment securities are assigned to the 20%
category, except for municipal or state revenue bonds, which have a 50% rating,
and direct obligations of or obligations guaranteed by the United States
Treasury or United States Government agencies, which have a 0% rating.
The federal bank regulatory authorities have also implemented a leverage
ratio, which is Tier 1 capital as a percentage of average total assets less
intangibles, to be used as a supplement to the risk-based guidelines. The
principal objective of the leverage ratio is to place a constraint on the
maximum degree to which a bank holding company may leverage its equity capital
base. The minimum required leverage ratio for top-rated institutions is 3%, but
most institutions are required to maintain an additional cushion of at least 100
to 200 basis points greater.
FDICIA established a capital-based regulatory scheme designed to promote
early intervention for troubled banks and requires the FDIC to choose the least
expensive resolution of bank failures. The new capital-based regulatory
framework contains five categories of compliance with regulatory capital
requirements, including "well capitalized," "adequately capitalized,"
"undercapitalized," "significantly undercapitalized," and "critically
undercapitalized." To qualify as a "well capitalized" institution, a bank must
have a leverage ratio of no less than 5%, a Tier 1 risk-based ratio of no less
than 6%, and a total risk-based capital ratio of no less than 10%, and the bank
must not be under any order or directive from the appropriate regulatory agency
to meet and maintain a specific capital level.
Under the FDICIA regulations, the applicable agency can treat an
institution as if it were in the next lower category if the agency determines
(after notice and an opportunity for hearing) that the institution is in an
unsafe or unsound condition or is engaging in an unsafe or unsound practice. The
degree of regulatory scrutiny of a financial institution will increase, and the
permissible activities of the institution will decrease, as it moves downward
through the capital categories. Institutions that fall into one of the three
undercapitalized categories may be required to (i) submit a capital restoration
plan; (ii) raise additional capital; (iii) restrict their growth, deposit
interest rates, and other activities; (iv) improve their management; (v)
eliminate management fees; or (vi) divest themselves of all or a part of their
operations. Bank holding companies controlling financial institutions can be
called upon to boost the institutions' capital and to partially guarantee the
institutions' performance under their capital restoration plans.
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<PAGE> 28
These capital guidelines can affect Satilla in several ways. Rapid growth,
poor loan portfolio performance, or poor earnings performance, or a combination
of these factors, could change Satilla's capital position in a relatively short
period of time, making an additional capital infusion necessary.
FDICIA requires the federal banking regulators to revise the risk-based
capital standards to provide for explicit consideration of interest-rate risk,
concentration of credit risk, and the risks of non-traditional activities. It is
uncertain what effect these regulations, when implemented, would have on Satilla
and the Bank.
FDICIA
FDICIA directs that each federal banking regulatory agency prescribe
standards for depository institutions and depository institution holding
companies relating to internal controls, information systems, internal audit
systems, loan documentation, credit underwriting, interest rate exposure, asset
growth, compensation, a maximum ratio of classified assets to capital, minimum
earnings sufficient to absorb losses, a minimum ratio of market value to book
value for publicly traded shares, and such other standards as the agency deems
appropriate. These standards are not expected to have any material effect on
Satilla and the Bank.
FDICIA also contains a variety of other provisions that may affect the
operations of Satilla and the Bank, including new reporting requirements,
regulatory standards for estate lending, "truth in savings" provisions, the
requirement that a depository institution give 90 days' prior notice to
customers and regulatory authorities before closing any branch, and a
prohibition on the acceptance or renewal of brokered deposits by depository
institutions that are not well capitalized or are adequately capitalized and
have not received a waiver from the FDIC. Under regulations relating to brokered
deposits, it is presently anticipated that the Bank will initially be well
capitalized and not restricted.
FDICIA generally prohibits a depository institution from making any capital
distribution (including payment of a dividend) or paying any management fee to
its holding company if the depository institution would thereafter be
undercapitalized. Undercapitalized depository institutions are subject to growth
limitations and are required to submit a capital restoration plan for approval.
For a capital restoration plan to be acceptable, the depository institution's
parent holding company must guarantee that the institution comply with such
capital restoration plan. The aggregate liability of the parent holding company
is limited to the lesser of 5% of the depository institution's total assets at
the time it became undercapitalized and the amount necessary to bring the
institution into compliance with applicable capital standards. If a depository
institution fails to submit an acceptable plan, it is treated as if it is
significantly undercapitalized. If the controlling holding company fails to
fulfill its obligations under FDICIA and files (or has filed against it) a
petition under the federal Bankruptcy Code, the claim would be entitled to a
priority in such bankruptcy proceeding over third party creditors of the bank
holding company.
Significantly undercapitalized depository institutions may be subject to a
number of requirements and restrictions, including orders to sell sufficient
voting stock to become adequately capitalized, requirements to reduce total
assets, and cessation of receipt of deposits from correspondent banks.
Critically undercapitalized institutions are subject to the appointment of a
receiver or conservator.
FDIC INSURANCE ASSESSMENTS
The Bank will be subject to FDIC deposit insurance assessments. The Bank's
deposits will be primarily insured by the FDIC BIF. The FDIC utilizes a
risk-based deposit insurance premium scheme to determine the assessment rates
for BIF-insured depository institutions. Each financial institution is assigned
to one of three capital groups -- well capitalized, adequately capitalized or
undercapitalized -- and further assigned to one of three subgroups within a
capital group, on the basis of supervisory evaluations by the institution's
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<PAGE> 29
primary federal and, if applicable, state regulators and other information
relevant to the institution's financial condition and the risk posed to the
applicable insurance fund. The actual assessment rate applicable to a particular
institution will, therefore, depend in part upon the risk assessment
classification so assigned to the institution by the FDIC. The FDIC is presently
considering whether to charge deposit insurance premiums based upon management
weaknesses and whether the bank's underwriting practices, concentrations of risk
and growth are undisciplined or outside industry norms.
BIF assessment rates currently range from 0 basis points on deposits for a
financial institution in the highest category to 27 basis points on deposits for
an institution in the lowest category, but may be as high as 31 basis points. In
addition, the Deposit Insurance Funds Act of 1996 (the "Funds Act") authorized
the FDIC to collect FICO deposit assessments on BIF-assessable deposits, which
for June 30, 1998, such assessment was 1.22 basis points for BIF insured banks.
COMMUNITY REINVESTMENT ACT
Satilla and the Bank will be subject to the provisions of the Community
Reinvestment Act of 1977, as amended (the "CRA"), and the federal banking
agencies' regulations thereunder. Under the CRA, all banks and thrifts have a
continuing and affirmative obligation, consistent with its safe and sound
operation to help meet the credit needs for their entire communities, including
low- and moderate-income neighborhoods. The CRA does not establish specific
lending requirements or programs for financial institutions, nor does it limit
an institution's discretion to develop the types of products and services that
it believes are best suited to its particular community, consistent with the
CRA. The CRA requires a depository institution's primary federal regulator, in
connection with its examination of the institution, to assess the institution's
record in assessing and meeting the credit needs of the community served by that
institution, including low- and moderate-income neighborhoods. The regulatory
agency's assessment of the institution's record is made available to the public.
Further, such assessment is required of any institution which has applied to:
(i) charter a national bank; (ii) obtain deposit insurance coverage for a
newly-chartered institution; (iii) establish a new branch office that accepts
deposits; (iv) relocate an office; or (v) merge or consolidate with, or acquire
the assets or assume the liabilities of, a federally regulated financial
institution. In the case of a bank holding company applying for approval to
acquire a bank or other bank holding company, the Federal Reserve will assess
the records of each subsidiary depository institution of the applicant bank
holding company, and such records may be the basis for denying the application.
Under CRA regulations, an evaluation system rates institutions based on
their actual performance in meeting community credit needs. The evaluation
system used to judge an institution's CRA performance consists of three tests: a
lending test; an investment test; and a service test. Each of these tests will
be applied by the institution's primary federal regulator taking into account
such factors as: (i) demographic data about the community; (ii) the
institution's capacity and constraints; (iii) the institution's product
offerings and business strategy; and (iv) data on the prior performance of the
institution and similarly-situated lenders. The new lending test, the most
important of the three tests for all institutions other than wholesale and
limited purpose (e.g., credit card) banks, will evaluate an institution's
lending activities as measured by its home mortgage loans, small business and
farm loans, community development loans, and, at the option of the institution,
its consumer loans.
Institutions having total assets of less than $250 million, such as the
Bank, will be evaluated under more streamlined criteria. In addition, a
financial institution will have the option of having its CRA performance
evaluated based on a strategic plan of up to five years in length that it had
developed in cooperation with local community groups. In order to be rated under
a strategic plan, the institution will be required to obtain the prior approval
of its federal regulator.
The interagency CRA regulations provide that an institution evaluated under
a given test will receive one of five ratings for that test: outstanding, high
satisfactory, low satisfactory, needs to improve, or substantial
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<PAGE> 30
non-compliance. An institution will receive a certain number of points for its
rating on each test, and the points are combined to produce an overall composite
rating of either outstanding, satisfactory, needs to improve, or substantial
noncompliance. Under the agencies' rating guidelines, an institution that
receives an "outstanding" rating on the lending test will receive an overall
rating of at least "satisfactory", and no institution can receive an overall
rating of "satisfactory" unless it receives a rating of at least "low
satisfactory" on its lending test. In addition, evidence of discriminatory or
other illegal credit practices would adversely affect an institution's overall
rating. Under the new regulations, an institution's CRA rating would continue to
be taken into account by its primary federal regulator in considering various
types of applications.
FISCAL AND MONETARY POLICY
Banking is a business which depends on interest rate differentials. In
general, the difference between the interest paid by a bank on its deposits and
its other borrowings, and the interest received by a bank on its loans and
securities holdings, constitutes the major portion of a bank's earnings. Thus,
the earnings and growth of Satilla and the Bank will be subject to the influence
of economic conditions generally, both domestic and foreign, and also to the
monetary and fiscal policies of the United States and its agencies, particularly
the Federal Reserve. The Federal Reserve regulates the supply of money through
various means, including open market dealings in United States government
securities, the discount rate at which banks may borrow from the Federal
Reserve, and the reserve requirements on deposits.
The monetary policies of the Federal Reserve historically have had a
significant effect on the operating results of commercial banks and will
continue to do so in the future. The conditions in the national and
international economies and money markets, as well as the actions and changes in
policy by monetary and fiscal authorities, and their effect on Satilla and the
Bank cannot be predicted.
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<PAGE> 31
MANAGEMENT
DIRECTORS AND EXECUTIVE OFFICERS OF SATILLA AND THE BANK
The following table sets forth, as of December 31, 1998, the name and age
of each executive officer and director of Satilla, as well as their positions
with Satilla since its inception and their proposed positions with the Bank upon
its inception:
<TABLE>
<CAPTION>
NAME AGE POSITIONS WITH SATILLA PROPOSED POSITIONS WITH BANK
- ---- --- ---------------------- ----------------------------
<S> <C> <C> <C>
David L. Knox, Sr. 49 Organizer and Chairman of the Chairman of the Board
Board of Directors of Directors
Rodney E. Bennett 58 Organizer, President, Chief Executive President, Chief Executive
Officer and Director Officer and Director
M. Anthony Ham 46 Organizer, Vice President Vice President and Director
and Director
Curtis J. Tumlin, II 28 Organizer, Secretary, Director
Treasurer and Director
Robert T. Baird 42 Organizer and Director Director
Walter A. Bennett 54 Organizer and Director Director
Richard L. Brandon 53 Organizer and Director Director
Cecily A. Hill 56 Organizer and Director Director
Wayne E. Knox 48 Organizer and Director Director
Sheila A. Meadows 43 Organizer and Director Director
Bill F. Raulerson 37 Organizer and Director Director
Steve E. Rawl 52 Organizer and Director Director
</TABLE>
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<PAGE> 32
ADDITIONAL INFORMATION REGARDING SATILLA'S DIRECTORS AND EXECUTIVE OFFICERS
David L. Knox, Sr. Mr. Knox, a resident of Camden County for 22 years,
has been the President and Chief Executive Officer of The Knox Realty Company, a
real estate holdings company located in Kingsland, Georgia, since 1991. Mr. Knox
has also been the Managing Partner of D&W Partnership, a partnership in
Kingsland, Georgia that purchases, sells, develops and leases real property,
since 1983. From 1977 to 1991, Mr. Knox was the President, Chief Executive
Officer and a Director of Citizens State Bank, a community bank located in
Kingsland, Georgia. Mr. Knox has over 28 years of experience in the banking
industry.
Rodney E. Bennett. Mr. Bennett, a resident of Charlton County for 24 years,
has been a consultant with Bennett Management Corporation, a bank management
consulting corporation in Brunswick, Georgia, since 1991. Mr. Bennett has been
the Vice President of BMC Mortgage Services, a mortgage service corporation in
Brunswick, Georgia, since 1992, and a Director of Georgia Sweet Carrots, Inc., a
wholesale distributor of carrots and other fresh produce in Alma, Georgia, since
1997. In addition, Mr. Bennett has been a partner with Bennett-Miller, a real
estate partnership in Brunswick, Georgia, since 1995.
Mr. Bennett has over 30 years of experience in the banking industry.
Mr. Bennett was formerly a Division President of the First Georgia Savings Bank
from 1987 to 1991, when he resigned to form Bennett Management Corporation. Mr.
Bennett was the Chief Executive Officer of the First National Bank of Folkston
from 1975 to 1986, at which point the First National Bank of Folkston was merged
with and into Bank South. Following the merger, Mr. Bennett was an Executive
Vice President and a Branch Manager for Bank South until 1987. Mr. Bennett was
also a Cashier with the First National Bank of Alma from 1972 to 1975, and an
Assistant Vice President of the First National Bank of Brunswick from 1958 to
1972.
M. Anthony Ham. Mr. Ham, a lifetime resident of Brantley County, has been a
Clerk of the Superior Court of Brantley County since 1989. Prior to such
employment, Mr. Ham was an Assistant Vice President and Loan Officer with
Citizens Bank, a community bank in Nahunta, Georgia, from 1971 to 1988. Mr. Ham
has also served as a Director of The Okefenokee Rural Electric Membership
Cooperative, an electric power distributor in Nahunta, Georgia, since 1994, and
The Oglethorpe Power Corporation, an electric power generating and distribution
company in Nahunta, Georgia, since 1996.
Curtis J. Tumlin, II. Mr. Tumlin, a lifetime resident of Brantley
County, has been a Financial Counselor for Satilla Health Services, a hospital
in Waycross, Georgia, since 1996. Mr. Tumlin was formerly a Teller at the
Atlantic Coast Federal Credit Union, a credit union in Waycross, Georgia, from
1994 to 1996 and a Property Appraiser for the Bulloch County Tax Assessors for
several months during 1994. Mr. Tumlin graduated from Georgia Southern
University in 1993, where he received a BBA degree. Mr. Tumlin has over 2 years
of experience in the banking industry.
Robert T. Baird. Dr. Baird, a resident of Camden County for 17 years,
has been a dentist in Woodbine, Georgia, since 1982. Dr. Baird graduated from
the Georgia Institute of Technology in 1978, where he was awarded a Bachelor of
Sciences in Chemistry, and from the Emory University School of Dentistry in
1982, where he received a Doctor in Dental Science degree.
Walter A. Bennett. Mr. Bennett, a resident of Nassau, Florida for 20 years,
has been the owner and President of Bennett Chrysler Dodge Jeep, an automobile
dealership in Kingsland, Georgia, since April 1998, and the owner and General
Manager of Bennett Chevrolet, Buick, Oldsmobile, an automobile dealership in
Kingsland, Georgia, since 1987. Prior to joining these dealerships, Mr. Bennett
was a Dealer Coordinator and Factory Representative with General Motors from
1969 to 1987.
Richard L. Brandon. Dr. Brandon, a resident of Camden County for 25
years, has been a physician in St. Marys, Georgia, since 1974. Dr. Brandon
graduated from the University of Georgia in 1971, where he was
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<PAGE> 33
awarded a Bachelor of Science in Chemistry, and from the Medical College of
Georgia, where he received a Doctor of Medicine degree.
Dr. Brandon has been the President of the Camden Women's Center, a
physician's center in St. Marys, Georgia, since January 1998. Dr. Brandon also
has been the sole owner of the Amelia Wellness Center, a real estate rental
company in Nassau, Florida, since 1988, and the AWC Food Servicer, Inc., a real
estate rental company in Nassau, Florida, since 1995.
Cecily A. Hill. Ms. Hill, a lifetime resident of Camden County, has
been the owner and Manager of Prudential Magnolia Realty, a real estate
brokerage company in Kingsland, Georgia, since 1987. Ms. Hill is a licensed real
estate agent.
Wayne E. Knox. Mr. Knox, a resident of Glynn County for 24 years, has
been a pipefitter at the Georgia Pacific plant in Brunswick, Georgia since 1973.
Mr. Knox has been a partner in D&W Partnership, a partnership in Kingsland,
Georgia that purchases, sells, develops and leases real property, since 1983,
and a partner in Waybo, a real estate rental partnership in Brunswick, Georgia,
since 1993.
Sheila A. Meadows. Ms. Meadows, a resident of Camden County for ten
years, has been an owner, Associate Broker and Rental Manager of Prudential
Magnolia Realty, a real estate brokerage company in Kingsland, Georgia, since
1990. Prior to joining Prudential, Ms. Meadows was a Teller with Portsmouth
Naval Shipyard Credit Union, a credit union in Portsmouth, Virginia, from 1984
to 1985. Ms. Meadows is a licensed real estate agent.
Bill F. Raulerson. Mr. Raulerson, a resident of Pierce County, has been
the President and General Manager of Lewis & Raulerson, Inc., a wholesale
petroleum and natural gas supplier and operator of gasoline convenience stores
located in Waycross, Georgia, since 1984. Mr. Raulerson has also been the Vice
President and a Director of Friendly Express, Inc., a convenience store chain
headquartered in Waycross, Georgia, since 1989.
Steve E. Rawl. Mr. Rawl, a lifetime resident of Camden County, has been
the sole owner and operator of Steve E. Rawl, Inc., a retail store in Waverly,
Georgia, since 1969. Mr. Rawl has been a partner of Simon Lake Property, Inc., a
real estate development company in Woodbine, Georgia, since 1979, and South East
Non Destructive Testing Laboratory, a real estate development company in
Woodbine, Georgia, since 1982. Mr. Rawl has also been a Director of The Georgia
Transmission Company, an electric transmission company in Atlanta, Georgia, and
a Director of The Okefenoke Rural Electric Membership Cooperative, an electric
power generating and distribution company in Nahunta, Georgia, since 1992. Mr.
Rawl was an Advisor Director of The First National Bank, a commercial bank in
St. Marys, Georgia, from 1994 to 1998, when he resigned to organize Satilla.
David L. Knox, Sr. is the brother of Wayne E. Knox. No other director
or executive officer of Satilla or the Bank is related to any other director or
executive officer.
31
<PAGE> 34
PRINCIPAL SHAREHOLDERS
SHARE SUBSCRIPTIONS
The following table sets forth certain information regarding the number of
Shares of Satilla's Common Stock for which each Organizer, director and
executive officer of Satilla intends to subscribe and the aggregate number of
the Shares intended to be subscribed for by all of Satilla's Organizers,
directors and executive officers as a group. Subject to prior regulatory
approval, Satilla's Organizers, directors and executive officers may elect to
purchase more than the Shares indicated below.
<TABLE>
<CAPTION>
ANTICIPATED SHARE OWNERSHIP AFTER THIS OFFERING
-------------------------------------------------------------------------
NUMBER OF SHARES TO BE PERCENTAGE OF MINIMUM PERCENTAGE OF MAXIMUM
NAME AND ADDRESS SUBSCRIBED OFFERING OFFERING
- ---------------------------------- ---------------------- --------------------- ---------------------
<S> <C> <C> <C>
David L. Knox, Sr.
712 Cinnamon Fern Trail
St. Marys, Georgia 31558 15,000 3.33% 2.72%
Rodney E. Bennett
Route 3, Box 3536
Folkston, Georgia 31357 10,000 2.22% 1.81%
M. Anthony Ham
P.O. Box 342
Nahunta, Georgia 31553 5,000 1.11% 0.91%
Curtis J. Tumlin, II
P.O. Box 452
Nahunta, Georgia 31553 5,000 1.11% 0.91%
Robert T. Baird
116 Temple Terrace Road
Woodbine, Georgia 31569 5,000 1.11% 0.91%
Walter A. Bennett
1739 Regatta Drive
Amelia Island, Florida 32034 10,000 2.22% 1.81%
Richard L. Brandon
522 Cardinal Circle East
St. Marys, Georgia 31558 20,000 4.44% 3.64%
Cecily A. Hill
379 Moeckel Place
St. Marys, Georgia 31558 5,000 1.11% 0.91%
Wayne E. Knox
305 Commons Road
St. Simons Island, Georgia 31522 10,000 2.22% 1.81%
</TABLE>
32
<PAGE> 35
<TABLE>
<CAPTION>
ANTICIPATED SHARE OWNERSHIP AFTER THIS OFFERING
-------------------------------------------------------------------------
NUMBER OF SHARES TO BE PERCENTAGE OF MINIMUM PERCENTAGE OF MAXIMUM
NAME AND ADDRESS SUBSCRIBED OFFERING OFFERING
- ---------------------------------- ---------------------- --------------------- ---------------------
<S> <C> <C> <C>
Sheila A. Meadows
389 Moeckel Place
St. Marys, Georgia 31558 5,000 1.11% 0.91%
Bill F. Raulerson
3789 Pond View Lane
Blackshear, Georgia 31516 10,000 2.22% 1.81%
Steve E. Rawl
65 Honey Creek Lane
Waverly, Georgia 31565 10,000 2.22% 1.81%
All Organizers, Directors and
Executive Officers as a group
(12 Persons) 110,000 24.44% 20.00%
</TABLE>
- --------------------
(1) Excludes (i) the 150 shares of Common Stock received by each of David L.
Knox, Sr. and Rodney E. Bennett, and the 100 shares of Common Stock
received by each of the other Organizers, as of December 30, 1998 in
exchange for their initial capital contribution of $1,500 and $1,000 each,
respectively, and (ii) the number of Shares that each Organizer will be
entitled to purchase pursuant to Organizer Warrants.
(2) All of such purchases will be made at a price of $10.00 per Share, the same
price at which Shares are being offered to the general public. No person is
presently expected to own more than 5% of the Shares of the Common Stock
immediately after this Offering. However, subject to prior regulatory
approvals, if required, Organizers may purchase additional Shares in this
Offering, if necessary for Satilla to achieve the Minimum Offering and also
may decide to purchase additional Shares in this Offering even if the
Minimum Offering is fully subscribed. Any Shares purchased by the
Organizers in excess of their original commitment will be purchased for
investment and not with the intent to resell such Shares. Although each
Organizer intends to subscribe for the respective number of Shares
indicated above, neither the Organizers nor any other subscriber will be
obligated to purchase Shares except pursuant to a valid Subscription
Agreement executed after receipt of this Prospectus.
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<PAGE> 36
ORGANIZER WARRANTS
In connection with this Offering, Satilla is offering, to Organizers only,
the right to receive Organizer Warrants to purchase an aggregate of 100,000
Shares of Satilla's Common Stock at an exercise price of $10.00 per Share. The
number of Shares to be subject to each Organizer Warrant shall be determined on
a pro rata basis, based upon the number of Shares that each Organizer purchases
in this Offering. In no event, however, will the Organizers be entitled to
purchase an aggregate of more than 100,000 Shares pursuant to Organizer
Warrants. Assuming that the Organizers subscribe for the number of Shares
indicated in the preceding table, Satilla will offer Organizer Warrants to each
organizer to purchase the approximate number of Shares set forth in the table
below:
<TABLE>
<CAPTION>
NUMBER OF SHARES
TO BE SUBJECT TO
NAME OF ORGANIZER ORGANIZER WARRANTS
----------------- ------------------
<S> <C>
David L. Knox, Sr............... 13,636
Rodney E. Bennett............... 9,091
M. Anthony Ham.................. 4,545
Curtis J. Tumlin, II............ 4,545
Robert T. Baird................. 4,545
Walter A. Bennett............... 9,091
Richard L. Brandon.............. 18,184
Cecily A. Hill.................. 4,545
Wayne E. Knox................... 9,091
Sheila A. Meadows............... 4,545
Bill F. Raulerson............... 9,091
Steve E. Rawl................... 9,091
-------
All Organizers as a group
(12 Persons)................. 100,000
=======
</TABLE>
34
<PAGE> 37
THE BOARD OF DIRECTORS
GENERAL
Satilla's Bylaws provide that the Board of Directors shall consist of not
less than five nor more than twenty-one directors, with the exact number to be
determined by the Board of Directors, each having a term of office of one year
and continuing thereafter until his or her successor has been elected and
qualified. Satilla's Board of Directors currently consists of twelve (12)
members who, following this Offering, will serve a one year term expiring at
Satilla's 2000 Annual Meeting of Shareholders. Directors will thereafter serve
terms of one year expiring upon Satilla's next Annual Meeting of Shareholders
and until the election and qualification of their successors. The Board of
Directors of the Bank will consist of the same individuals who are currently
serving as directors of Satilla. Bank directors will also serve for an initial
one year term expiring at the Bank's 2000 Annual Meeting of Shareholders, after
which Bank directors will be elected each year to serve one year terms.
COMPENSATION OF DIRECTORS
Neither Satilla nor the Bank presently intends to compensate its directors
for their attendance of meetings of their respective Boards of Directors or for
any other services to their respective Boards of Directors. Following the
completion of this Offering and the formation of the Bank, Satilla's Board of
Directors may pay director fees to the directors of Satilla or the Bank once
Satilla and the Bank become profitable. Directors may be reimbursed for their
reasonable out-of-pocket expenses incurred in connection with their service on
Satilla's and the Bank's respective Boards of Directors.
EXECUTIVE COMPENSATION
GENERAL
As of the date of this Prospectus, Satilla's only employees are the Satilla
Officers, none of whom will receive any remuneration for their services to
Satilla, but instead will be compensated in their capacities as employees of the
Bank. Following this Offering, Satilla's Board of Directors will create a
Compensation Committee, the members of which will determine the appropriate
level of compensation for the Bank's executive officers, including the Satilla
Officers, as well as the Bank's other employees. In addition, Satilla's
Compensation Committee will determine the number of options and/or other awards
that each of its officers will receive under Satilla's 1999 Long-Term Incentive
Plan (the "Incentive Plan").
35
<PAGE> 38
Subject to the approval of the Bank's Compensation Committee, when formed,
Satilla presently expects that the Bank will initially pay to its executive
officers the following annual salaries:
<TABLE>
<CAPTION>
Position and Name of Expected Appointee Annual Salary
--------------------------------------- -------------
<S> <C>
Chairman of the Board of Directors
David L. Knox, Sr. $75,000
President and Chief Executive Officer
Rodney E. Bennett $75,000
Executive Vice President
** $55,000
Vice President
M. Anthony Ham $50,000
Assistant Vice Presidents (2)
**
** $40,000
Chief of Operations / Cashier
** $40,000
</TABLE>
- ---------------------
** Experienced candidates have been identified for these positions, but
have not yet terminated their current employment.
As of the date of this Prospectus, Satilla had not entered into an
employment contract with any of Satilla Officers, nor had the Bank entered into
an employment contract with any of its proposed officers and other employees.
1999 LONG-TERM INCENTIVE PLAN
The Incentive Plan was adopted by the Board of Directors and shareholders
of Satilla on March 9, 1999. A summary of the Incentive Plan is set forth below.
The summary is qualified in its entirety by reference to the full text of the
Incentive Plan which has been filed with the Securities and Exchange Commission
(the "Commission") as an exhibit to the registration statement of which this
Prospectus is part. See "Additional Information."
General. The purpose of the Incentive Plan is to promote the success and
enhance the value of Satilla by linking the personal interests of employees,
officers, and directors to those of Satilla's new shareholders, and by providing
such persons with an incentive for outstanding performance. As of February 28,
1998, there were approximately four persons eligible to participate in the
Incentive Plan.
The Incentive Plan authorizes the granting of awards ("Awards") to key
employees, officers, and directors of Satilla or its subsidiaries in the
following forms: (i) options to purchase shares of Common Stock ("Options"),
which may be incentive stock options or non-qualified, (ii) stock appreciation
rights ("SARs"); (iii) performance units ("Performance Units"); (iv) restricted
stock ("Restricted Stock"); (v) dividend equivalents ("Dividend Equivalents");
and (vi) other stock-based awards.
36
<PAGE> 39
Subject to adjustment as provided in the Incentive Plan, the aggregate
number of shares of Common Stock reserved and available for Awards or which may
be used to provide a basis of measurement for or to determine the value of an
Award (such as with SARs or Performance Units) is 100,000 (of which not more
than 10% may be granted as Awards of Restricted Stock or unrestricted stock
Awards). The maximum number of shares of Common Stock with respect to one or
more Options and/or SARs that may be granted during any one calendar year under
the Incentive Plan to any one participant is 25,000. The maximum fair market
value of any Awards (other than Options and SARs) that may be received by a
participant (less any consideration paid by the participant for such Award)
during any one calendar year under the Incentive Plan is $100,000.
Administration. The Incentive Plan will be administered by the Compensation
Committee of the Board of Directors of Satilla (the "Committee"). The Committee
has the power, authority and discretion, among other things, to: (i) designate
participants; (ii) determine the type or types of Awards to be granted to each
participant and the terms and conditions thereof; (iii) establish, adopt or
revise any rules and regulations as it may deem necessary or advisable to
administer the Incentive Plan; and (iv) make all other decisions and
determinations that may be required under the Incentive Plan, or that the
Committee deems necessary or advisable.
Awards. The Committee may determine that any Award will be determined
solely on the basis of (i) the achievement by Satilla, or a parent or subsidiary
company, of a specified target return, or target growth in return, on equity or
assets; (ii) Satilla's stock price, or the stock price of a parent or subsidiary
company; (iii) the achievement by Satilla, or a parent or subsidiary company or
a business unit of Satilla, of a specified target, or target growth in,
revenues, operating income, net income or earnings per share; (iv) the
achievement of objectively determinable goals with respect to service or product
delivery, service or product quality, customer satisfaction, meeting budgets
and/or retention of employees; or (v) any combination of the goals set forth in
(i) through (iv) above. Furthermore, the Committee reserves the right for any
reason to reduce (but not increase) any Award, notwithstanding the achievement
of a specified goal. If an Award is made on such basis, the Committee must
establish goals prior to the beginning of the period for which such performance
goal relates (or such later date as may be permitted under Section 162(m) of the
Internal Revenue Code of 1986, as amended (the "Tax Code"), or the regulations
thereunder). Any payment of an Award granted with performance goals will be
conditioned on the written certification of the Committee in each case that the
performance goals and any other material conditions were satisfied.
No unexercised or restricted Award will be assignable or transferable by a
participant other than by will or the laws of descent and distribution or,
except in the case of an incentive stock option, pursuant to a qualifying
domestic relations order; provided, however, that the Committee may (but need
not) permit other transfers where the Committee concludes that such
transferability (i) does not result in accelerated taxation, (ii) does not cause
any Option intended to be an incentive stock option to fail to be described in
Section 422(b) of the Tax Code, and (iii) is otherwise appropriate and
desirable, taking into account any factors deemed relevant, including without
limitation, any state or federal tax or securities laws or regulations
applicable to transferable Awards. A participant may, in the manner determined
by the Committee, designate a beneficiary to exercise the rights of the
participant and to receive any distribution with respect to any Award upon the
participant's death.
In the event of a Change in Control of Satilla (as defined in the Incentive
Plan), all outstanding Options, SARs, and other Awards in the nature of rights
that may be exercised will become fully vested and all restrictions on all
outstanding Awards will lapse; provided, however that such acceleration will not
occur if, in the opinion of Satilla's accountants, such acceleration would
preclude the use of "pooling of interest" accounting treatment for a Change in
Control transaction that (i) would otherwise qualify for such accounting
treatment, and (ii) is contingent upon qualifying for such accounting treatment.
In the event of the occurrence of any circumstance, transaction or event not
constituting a Change in Control as defined in the Incentive Plan but which the
Board of Directors deems to be, or to be reasonably likely to lead to, an
37
<PAGE> 40
effective change in control of Satilla, the Committee may in its sole discretion
declare all outstanding Options, SARs, and other Awards in the nature of rights
that may be exercised to become fully vested, and/or all restrictions on all
outstanding Awards to lapse, in each case as of such date as the Committee may,
in its sole discretion, declare, which may be on or before the consummation of
such transaction or event.
Termination and Amendment. The Board or the Committee may terminate, amend
or modify the Incentive Plan without stockholder approval; provided, however,
that the Board or the Committee may condition any amendment on the approval of
stockholders of Satilla if such approval is necessary or deemed advisable with
respect to tax, securities or other applicable laws, policies or regulations. No
termination, amendment, or modification of the Incentive Plan may adversely
affect any Award previously granted under the Incentive Plan, without the
consent of the participant.
Benefits to Named Executive Officers and Others. As of the date of this
Prospectus, no stock options or other Awards had been granted or approved for
grant under the Incentive Plan. Any future Awards will be made at the discretion
of the Committee. Therefore, it is not presently possible to determine the
number or terms of Awards to be made in the future.
Section 162(m). Pursuant to Section 162(m) of the Tax Code, the Company may
not deduct compensation in excess of $1 million paid to the Chief Executive
Officer and the four next most highly compensated executive officers of the
Company. The 1999 Plan is designed to comply with Code Section 162(m) so that
the grant of Options and SARs under the 1999 Plan will be excluded from the
calculation of annual compensation for purposes of Code Section 162(m) and will
be fully deductible by the Company, although other Awards under the Incentive
Plan that are not performance based Awards may not so qualify.
CERTAIN TRANSACTIONS
Satilla presently intends to use approximately $105,000 of the net proceeds
of this Offering to repay outstanding amounts under the Line of Credit, which
was personally guaranteed by the Organizers. See "Use of Proceeds."
The Organizers hired Bennett Management Corporation ("BMC"), a bank
consulting firm, to prepare the regulatory applications and to otherwise assist
in the formation of Satilla and the Bank. Mr. Rodney E. Bennett, the President
and Chief Executive Officer of Satilla and the proposed President and Chief
Executive Officer of the Bank, is the acting President of BMC, and Mr. Bennett
and his wife each own 50% of the capital stock of BMC. The Organizers agreed to
pay BMC $55,000 plus expenses for its services, and, to date, the Organizers
have used the Line of Credit to pay BMC approximately $45,000. The Organizers
presently intend to use the Line of Credit to pay the remaining $10,000 to BMC
upon receipt of Satilla's and the Bank's regulatory approvals. See "Use of
Proceeds."
On October 21, 1998, the Organizers, on behalf of Satilla and the Bank,
paid $10,000 for an Option Agreement (the "Camden Option Agreement") to purchase
the site for the Bank's proposed Camden office (the "Camden Site"). The Camden
Option Agreement grants to Satilla the exclusive option to purchase the Camden
Site at any time on or prior to June 30, 1999 for $230,000 less the option fee
previously paid. The Camden Site is jointly owned by five persons, including Ms.
Cecily A. Hill and Ms. Sheila A. Meadows, who are Organizers and directors of
Satilla and proposed directors of the Bank. The Bank presently intends to use
the net proceeds of this Offering to purchase the Camden Site, which has been
recently appraised by an independent third party for $236,500.
On November 10, 1998, the Organizers, on behalf of Satilla and the Bank
paid $10,000 for an Option Agreement (the "Brantley Option Agreement") to
purchase the site for the Bank's proposed Brantley office (the "Brantley Site").
The Brantley Option Agreement grants to Satilla the exclusive option to purchase
the
38
<PAGE> 41
Brantley Site at any time on or prior to June 30, 1999 for $160,000 less the
option fee previously paid. The Brantley Site is owned by Mr. M. Anthony Ham, an
Organizer, director and the Vice President of Satilla and the proposed Vice
President and director of the Bank. The Bank presently intends to use the net
proceeds of this Offering to purchase the Brantley Site, which has been recently
appraised by an independent third party for $164,500.
In the opinion of Satilla's Board of Directors, each of the transactions
described above was made on substantially the same terms, including, without
limitation, price, as those prevailing at the time for comparable transactions
with unrelated parties. Furthermore, Satilla's Board of Directors believes that
the two sites which Satilla has options to purchase are among the best sites for
the Bank's operations.
Satilla and the Bank anticipate that the directors and officers of Satilla
and the Bank, and certain business organizations and individuals affiliated with
such persons, will be customers of and will have banking transactions in the
ordinary course of business with the Bank. Such transactions may include loans,
commitments, lines of credit and letters of credit. Satilla's Board of Directors
has resolved that all such transactions must be made on substantially the same
terms, interest rates, repayment terms and collateral, as those prevailing at
the time for comparable transactions with other unrelated persons, and will not
involve more than the normal risk of collectibility or other unfavorable
features.
39
<PAGE> 42
SHARES ELIGIBLE FOR FUTURE SALE
Upon completion of this Offering, Satilla will have a minimum of
approximately 450,000 and a maximum of approximately 550,000 Shares of Common
Stock outstanding. The Shares sold in this Offering will be freely tradable
without restriction or further registration unless purchased by "affiliates" of
Satilla. As defined in Commission Rule 144 ("Rule 144") under the Securities Act
of 1933, as amended (the "Securities Act"), an "affiliate" of an issuer is a
person who directly, or indirectly through one or more intermediaries, controls,
is controlled by, or is under common control with, such issuer, and generally
includes members of the Board of Directors of Satilla and the Bank, executive
officers of Satilla and the Bank, and 5% or greater stockholders of Satilla and
the Bank.
In general, under Rule 144, as currently in effect, any affiliate of
Satilla who purchases Shares pursuant to this Offering is entitled to sell
within any three-month period a number of Shares that does not exceed the
greater of 1% of the outstanding Shares of Satilla's Common Stock or the average
weekly trading volume in Satilla's Common Stock during the four calendar weeks
preceding such sale. Sales under Rule 144 are also subject to certain provisions
regarding the manner of sale, notice requirements, and the availability of
current public information about Satilla. Following the Expiration Date of this
Offering, Satilla intends to file with the Commission periodic reports that
provide the "current public information" required by Rule 144. A stockholder (or
stockholders whose Shares are aggregated) who has not been an affiliate of
Satilla for at least 90 days prior to a proposed sale transaction, and who has
beneficially owned "restricted securities" for at least two years is entitled to
sell such Shares under Rule 144 without regard to the value or other limitations
described above.
Following the completion of this Offering, there will be outstanding
Organizer Warrants to purchase an aggregate of 100,000 Shares of Satilla's
Common Stock at a price of $10.00 per Share. Each of the outstanding Organizer
Warrants will become fully vested and exercisable after a period of three years
from the date of this Prospectus. Upon the Organizers' exercise of their
Organizer Warrant, the Organizers will receive Shares that will be subject to
the Rule 144 resale limitations, as previously discussed.
No market presently exists for Satilla's Common Stock, and Satilla does not
believe that an active trading market will develop in the foreseeable future.
There are no present plans for the Common Stock to be listed or qualified for
trading on any national securities exchange or on Nasdaq, and there is currently
no independent market maker in Satilla's Common Stock. As a result, no
prediction can be made as to the market price of the Common Stock prevailing
from time to time following this Offering. Sales of substantial amounts of such
Shares, or the perception that such sales could occur, could adversely affect
the market price of the Common Stock and could impair Satilla's future ability
to raise capital through an offering of equity securities.
40
<PAGE> 43
DESCRIPTION OF THE COMPANY'S CAPITAL STOCK
The following is a summary of certain terms of Satilla's capital stock and
is subject to and qualified in its entirety by reference to certain statutes
regulating the rights of holders of Satilla's capital stock and to Satilla's
Articles of Incorporation and Bylaws, which are filed with the Commission as
exhibits to the registration statement of which this Prospectus is part.
COMMON STOCK
General. Satilla is authorized by its Articles of Incorporation to issue up
to 2,000,000 Shares of Common Stock, $.01 par value per share. As of the date of
this Prospectus, there were 1,300 shares of Common Stock issued and outstanding,
held by the twelve Organizers. The transfer agent and registrar for the Common
Stock is __________.
Voting Rights. The holders of Satilla's Common Stock are entitled to one
vote per Share and are not entitled to cumulative voting rights in the election
of directors. As a result, the holders of more than 50% of the Shares of the
Common Stock voting in the election of directors (subject to the voting rights
of any Preferred Stock (as defined below) then outstanding) can elect all of the
directors then standing for election if they choose to do so and, in such event,
the holders of the remaining less than 50% of the shares voting for the election
of directors would not be able to elect any person or persons to Satilla's Board
of Directors.
Dividend Rights. Subject to any preferences of any Preferred Stock then
outstanding, each Share of Satilla Common Stock is entitled to participate
equally in dividends as and when declared by Satilla's Board of Directors out of
funds legally available therefor. Generally, cash dividends may not render
Satilla insolvent, and cash dividends of Satilla may be restricted by certain
federal and state laws regulating banks and bank holding companies.
Preemptive Rights. The holders of Satilla's Common Stock do not have any
preemptive or preferential right to purchase or to subscribe for any additional
Shares of Common Stock or any other securities that may from time to time be
issued by Satilla.
Assessment and Redemption. All outstanding Shares of Common Stock issued in
this Offering will be fully paid and nonassessable. There is no provision for
redemption or conversion of Satilla's Common Stock.
Liquidation Rights. In the event of liquidation, dissolution or winding-up
of Satilla, whether voluntary or involuntary, the holders of Satilla's Common
Stock (and the holders of any class or series of stock entitled to participate
with Satilla's Common Stock in the distribution of assets) will be entitled to
share ratably in any of the net assets or funds which are available for
distribution to shareholders, after the satisfaction of all liabilities, or
after adequate provision is made therefor and after distribution to holders of
any class of stock having preference over Satilla's Common Stock in the case of
liquidation.
PREFERRED STOCK
General. Satilla's Articles of Incorporation authorize the Board of
Directors, without further shareholder action, to issue from time to time, a
maximum of 500,000 shares of Preferred Stock, $.01 par value (the "Preferred
Stock"), in one or more series, upon such terms, at such times and for such
consideration as Satilla's Board of Directors may determine. Each such series
may have such voting powers, full or limited, or no voting powers, and such
designations, preferences and relative, participating, optional or other special
rights and qualifications, limitations or restrictions thereof, as are
established by Satilla's Board of Directors. Satilla had not issued, and had no
plans to issue, any shares of its Preferred Stock as of the date of this
Prospectus. Any shares of Preferred Stock issued in the future may have priority
over previously issued shares of Common Stock as to payment of dividends and
upon liquidation.
41
<PAGE> 44
ORGANIZER WARRANTS
General. In addition to the Common Stock, Satilla is also offering, to the
Organizers only, Organizer Warrants to purchase an aggregate of 100,000 Shares
of Satilla's Common Stock. The Organizer Warrants are being offered to the
Organizers in consideration of their work in organizing Satilla and the Bank and
their capital investment therein. The number of Shares to be the subject of each
Organizer Warrant will be determined on a pro rata basis, based upon the number
of Shares purchased by such Organizer in this Offering.
Vesting and Exercise Rights. The Organizers' rights under the Organizer
Warrants will become fully vested upon the later of the termination of this
Offering or the opening of the Bank, and each Organizer Warrant will become
fully exercisable three years after vesting.
Termination; Transferability. Each Organizer Warrant will terminate on
December 31, 2009. The Organizer Warrants are non-transferable, except, in the
case of the death of the holder of the Organizer Warrant, by will or under the
laws of descent and distribution. Holders of Warrants have no voting or other
rights as shareholders of Satilla's Common Stock.
Directed Exercise, Call or Forfeiture by Regulatory Agencies. In the event
that any of the Georgia Department, the FDIC or the Federal Reserve determine
that Satilla and/or the Bank are inadequately capitalized in light of regulatory
guidelines, the regulatory agency making such determination may direct the
exercise, call or complete forfeiture of the Organizers' rights under their
respective Organizer Warrants.
LEGAL MATTERS
The legality of the Shares of Common Stock to be issued in this Offering
has been passed upon by Alston & Bird LLP, Atlanta, Georgia.
EXPERTS
The consolidated financial statements of Satilla as of and for the period
from July 1, 1998 through December 31, 1998 have been included herein and in the
registration statement of which this Prospectus is part in reliance upon the
report of Thigpen, Jones, Seaton & Co., P.C., Dublin, Georgia, independent
certified public accountants, appearing elsewhere herein and upon the authority
of such firm as experts in accounting and auditing.
INDEMNIFICATION
The Georgia Business Corporation Code (the "GBCC") permits, under certain
circumstances, the indemnification of officers, directors, employees and agents
of a corporation with respect to any threatened, pending or completed action,
suit or proceeding, whether civil, criminal, administrative or investigative, to
which such person was or is a party or is threatened to be made a party by
reason of his action in such capacity for, or at the request of, such
corporation. To the extent that such person is successful in defending any such
suit, Georgia law provides that he shall be indemnified against expenses
(including attorneys' fees) actually and reasonably incurred by him in
connection therewith.
Satilla's Articles of Incorporation and Bylaws provide for the
indemnification of Satilla's directors, officers, employees and agents in
accordance with the GBCC. Georgia law also provides that, with certain
42
<PAGE> 45
exceptions, the above rights will not be deemed exclusive of other rights of
indemnification contained in any Article of Incorporation, Bylaw, resolution or
agreement approved by the holders of a majority of the stock. Satilla's Bylaws
provide that Satilla may purchase and maintain insurance on behalf of directors,
officers, employees and agents, as well as others serving at their request,
against any liabilities asserted against such persons whether or not Satilla
would have the power to indemnify such persons against such liability under the
GBCC. Satilla intends to purchase and maintain such insurance.
Insofar as indemnification for liabilities arising under the Securities Act
of 1933, may be permitted to directors, officers and controlling persons of
Satilla pursuant to the foregoing provisions, or otherwise, Satilla has been
advised that, in the opinion of the Commission, such indemnification is against
public policy as expressed in the Securities Act and is therefore unenforceable.
ADDITIONAL INFORMATION
Satilla has filed with the Commission through its Electronic Data Gathering
and Retrieval System ("EDGAR") a Registration Statement on Form SB-2 (together
with all amendments and exhibits thereto, the "Registration Statement") under
the Securities Act with respect to the offer and sale of Common Stock pursuant
to this Prospectus. This Prospectus, filed as a part of the Registration
Statement, does not contain all of the information set forth in the Registration
Statement or the exhibits and schedules thereto in accordance with the rules and
regulations of the Commission and reference is hereby made to such omitted
information. Statements made in this Prospectus concerning the contents of any
contract, agreement or other document filed as an exhibit to the Registration
Statement are summaries of the terms of such contracts, agreements or documents.
Reference is made to each such exhibit for a more complete description of the
matters involved. The Registration Statement and the exhibits and schedules
thereto filed with the Commission may be inspected, without charge, and copies
may be obtained at prescribed rates, at the public reference facility maintained
by the Commission at Judiciary Plaza, 450 Fifth Street, N.W., Washington, D.C.
20549 and at the regional offices of the Commission located at 7 World Trade
Center, 13th Floor, New York, New York 10048 and Citicorp Center, 500 West
Madison Street, Suite 1400, Chicago, Illinois 60661-2511. The public may obtain
additional information regarding the operation of the Public Reference Room by
calling the Commission at 1-800-SEC-0330. The Registration Statement and other
information filed by Satilla with the Commission via EDGAR are also available at
the web site maintained by the Commission on the World Wide Web at
http://www.sec.gov.
Satilla has not previously been subject to the reporting requirements of
the Securities Exchange Act of 1934, as amended (the "Exchange Act"). Upon the
later of the filing of a registration statement on Form 8-A with respect to
Satilla's Common Stock and the effective date of this Registration Statement,
however, Satilla and the holders of its Common Stock will become subject to the
proxy solicitation rules, reporting requirements and restriction on stock
purchases and sales by directors, officers and greater than 10% stockholders,
the annual and periodic reporting and certain other requirements of the Exchange
Act. Accordingly, Satilla intends to furnish its stockholders with annual
reports containing financial statements audited by its independent accountants
and quarterly reports for the first three quarters of each fiscal year
containing unaudited financial statements.
43
<PAGE> 46
FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
INDEX TO FINANCIAL STATEMENTS
<TABLE>
<CAPTION>
Page
----
<S> <C>
Independent Auditors' Reports .............................. F-2
Balance Sheet as of December 31, 1998 ...................... F-3
Statement of Income for the period from July 1, 1998 through
December 31, 1998 ........................................ F-4
Statement of Stockholders' Equity for the period from
July 1, 1998 through December 31, 1998 ................... F-5
Statement of Cash Flows for the period from July 1, 1998
through December 31, 1998 ................................ F-6
Notes to Financial Statements .............................. F-7
</TABLE>
F-1
<PAGE> 47
INDEPENDENT AUDITORS' REPORT
Organizers
Satilla Financial Services, Inc.
We have audited the accompanying balance sheet of Satilla Financial
Services, Inc. as of December 31, 1998, and the related statements of income,
changes in shareholders' equity and cash flows for the period of July 1, 1998 to
December 31, 1998. These financial statements are the responsibility of the
Company's management. Our responsibility is to express an opinion on these
financial statements based on our audit.
We conducted our audit in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements. An audit also includes,
assessing the accounting principles used and significant estimates made by
management, as well as evaluating the overall financial statement presentation.
We believe that our audit provides a reasonable basis for our opinion.
In our opinion, the financial statements referred to above present fairly,
in all material respects, the financial position of Satilla Financial Services,
Inc. at December 31, 1998, and the results of its operations and its cash flows
for the period of July 1, 1998 to December 31, 1998, in conformity with
generally accepted accounting principles.
/s/ THIGPEN, JONES, SEATON & CO., PC
February 26, 1999
Dublin, Georgia
F-2
<PAGE> 48
SATILLA FINANCIAL SERVICES, INC.
BALANCE SHEET
<TABLE>
<CAPTION>
As of
December 31,
1998
-----------
<S> <C>
Assets
Cash and cash equivalents $ 13,430
Other assets 15,000
--------
Total Assets $ 28,430
========
Liabilities and Shareholders' Equity
Current liabilities:
Short-term note payable $ 70,000
Other liabilities 5,000
--------
Total current liabilities 75,000
--------
Commitments and Contingencies
Shareholders' Equity
Common stock, $.01 par value, authorized 2,000,000 shares, issued
and outstanding 1,300 shares 13
Additional paid-in capital 12,987
Deficit accumulated during development stage (59,570)
--------
Total shareholders' equity (46,570)
--------
Total Liabilities and Shareholders' Equity $ 28,430
========
</TABLE>
See Accompanying Notes to Financial Statements
F-3
<PAGE> 49
SATILLA FINANCIAL SERVICES, INC.
STATEMENT OF INCOME
<TABLE>
<CAPTION>
Period of
July 1, 1998
to December 31, 1998
--------------------
<S> <C>
Revenues $ -
--------
Less Expense:
Application fees 12,000
Professional fees 43,201
Building and site plans 1,903
Dues and subscriptions 546
Postage 36
Travel and entertainment 1,884
--------
Total Expenses 59,570
--------
Net Loss $(59,570)
Beginning Accumulated Deficit --
--------
Ending Accumulated Deficit $(59,570)
========
</TABLE>
See Accompanying Notes to Financial Statements
F-4
<PAGE> 50
SATILLA FINANCIAL SERVICES, INC.
STATEMENT OF CHANGES IN SHAREHOLDERS' EQUITY
<TABLE>
<CAPTION>
Deficit
Additional accumulated
Common Paid-in during
Stock Capital development stage Total
-------- ---------- ------------------ --------
<S> <C> <C> <C> <C>
Balance, December 31, 1997 $ -- $ -- $ -- $ --
--------
Comprehensive income:
Net loss -- -- (59,570) (59,570)
--------
Total comprehensive income (59,570)
--------
Initial issuance of stock 13 12,987 -- 13,000
-------- ------- -------- --------
Balance, December 31, 1998 $ 13 $12,987 $(59,570) $(46,570)
======== ======= ======== ========
</TABLE>
See Accompanying Notes to Financial Statements
F-5
<PAGE> 51
SATILLA FINANCIAL SERVICES, INC.
STATEMENT OF CASH FLOWS
<TABLE>
<CAPTION>
Period of
July 1, 1998
to December 31, 1998
--------------------
<S> <C>
Cash Flows from Operating Activities:
Net loss $(59,570)
Adjustments to reconcile net loss to net cash used
in operating activities:
Increase in other liabilities 5,000
--------
Net cash used in operating activities (54,570)
--------
Cash Flows from Investing Activities:
Land options (15,000)
Issuance of common stock 13,000
--------
Net cash used in investing activities (2,000)
--------
Cash Flows from Financing Activities-
Proceeds from issuance of debt 70,000
--------
Net Increase in Cash and Cash Equivalents 13,430
Cash and Cash Equivalents, Beginning of Year --
--------
Cash and Cash Equivalents, End of Year $ 13,430
========
</TABLE>
See Accompanying Notes to Financial Statements
F-6
<PAGE> 52
SATILLA FINANCIAL SERVICES, INC.
NOTES TO FINANCIAL STATEMENTS
PERIOD OF JULY 1, 1998 TO DECEMBER 31, 1998
A. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
1. REPORTING ENTITY - The Satilla Financial Services Inc. is a
development stage enterprise which began with a group of
thirteen organizers in July 1998, and plans to charter a State
Bank in St. Marys and Nahunta, Georgia called the Satilla
Community Bank. The Company is pending approval from the State
Department of Banking and Finance and the Federal Deposit
Insurance Corporation. The Satilla Financial Services, Inc.
will own 100% of the shares of the proposed state chartered
bank.
The reporting period for the statements of income and cash
flow is from July 1, 1998, when the first activity occurred,
to December 31, 1998.
2. CASH AND CASH EQUIVALENTS - For the purpose of the statement
of cash flows, the Company considers all highly liquid debt
instruments purchased with a maturity of three months or less
to be cash equivalents. This includes money market deposit
accounts and short-term certificates of deposit.
3. MANAGEMENT ESTIMATES - The preparation of financial statements
in conformity with generally accepted accounting principles
requires management to make estimates and assumptions that
affect the reported amounts of assets and liabilities at
December 31, 1998 revenues and expenses during the reporting
period. Actual results could differ from those estimates.
4. ADVERTISING COSTS - The Company has incurred no advertising
costs.
B. SHORT-TERM BORROWINGS
<TABLE>
<CAPTION>
1998
-------
<S> <C>
The Bankers Bank $70,000
=======
</TABLE>
These borrowings are against a line of credit that has been established
with The Bankers Bank for a total of $350,000 with interest at the
prime rate as established by The Bankers Bank. The current rate is
7.75% with interest payable at maturity. Principal and accrued interest
will be due at maturity on September 30, 1999.
C. RELATED PARTY TRANSACTIONS
The note payable at The Bankers Bank is fully guaranteed by the
thirteen organizers. There is no additional collateral for this loan.
The Company has contracted with Bennett Consulting for bank charter
application preparation and other matters related to organization. One
of the organizers owns this firm.
Two option agreements have been executed regarding the purchase of land
for the bank sites of which three organizers are related to these
options. See Note D for further information on these transactions.
D. COMMITMENTS AND CONTINGENCIES
Satilla Financial Services, Inc. has entered an option agreement with
five individuals to acquire a site for the Bank in St. Marys, Georgia.
Two of these individuals, Cecily Hill and Shelia Meadows, are
organizers of the bank. The Company has also entered into an option
agreement with Marshall A. Ham to acquire a site for the Nahunta branch
site. Mr. Ham is also an organizer of the bank. Both of these options
expire at 12:00 noon on June 30, 1999. The exercise of these options
would commit the Company to the purchase of the two sites at $160,000
and $230,000, respectively.
F-7
<PAGE> 53
E. DISCLOSURES RELATING TO STATEMENT OF CASH FLOWS
CASH FLOWS RELATING TO INTEREST AND INCOME TAXES - Cash paid during the
period for interest and income taxes was as follows:
<TABLE>
<CAPTION>
Period of
July 1, 1998
to December 31, 1998
--------------------
<S> <C>
Interest (net of amount capitalized) $ -
=========
Income Taxes $ -
=========
</TABLE>
F. YEAR 2000 COMPLIANCE ISSUES
The Company is in the process of evaluating the potential effects of
the Year 2000 problem on its operating and environmental systems when
purchasing new equipment. This potential problem exists due to many
older computers having been programmed to recognize only the last two
digits of a year i.e., "98" is for the year 1998. Accordingly, with the
new millennium approaching, these computers will potentially recognize
the year 2000 - "00" as the year 1900, or just not be able to
comprehend the date, thus, potentially effecting the accuracy of, or
ability to, process any date sensitive functions.
The Company will adopt a plan for bringing their systems into
compliance so that the potential problems should not occur at start-
up.
G. CAPITAL STRUCTURE
The Company's prospectus authorizes warrants to organizers exercisable
for the purchase of up to 100,000 common shares. The Company is also
authorized under its organizing documents to issue 500,000 shares of
preferred stock.
F-8
<PAGE> 54
================================================================================
NO DEALER, SALESPERSON OR ANY OTHER PERSON HAS BEEN AUTHORIZED TO GIVE
ANY INFORMATION OR TO MAKE ANY REPRESENTATION IN CONNECTION WITH THIS OFFERING
OTHER THAN THOSE CONTAINED IN THIS PROSPECTUS, AND, IF GIVEN OR MADE, SUCH
INFORMATION OR REPRESENTATIONS MUST NOT BE RELIED UPON AS HAVING BEEN AUTHORIZED
BY SATILLA. THIS PROSPECTUS DOES NOT CONSTITUTE AN OFFER TO SELL OR A
SOLICITATION OF AN OFFER TO BUY THE COMMON STOCK BY ANYONE IN ANY JURISDICTION
IN WHICH SUCH OFFER OR SOLICITATION IS NOT AUTHORIZED, OR IN WHICH THE PERSON
MAKING SUCH OFFER OR SOLICITATION IS NOT QUALIFIED TO DO SO, OR TO ANYONE TO
WHOM IT IS UNLAWFUL TO MAKE SUCH OFFER OR SOLICITATION. NEITHER THE DELIVERY OF
THIS PROSPECTUS NOR ANY SALE MADE HEREUNDER SHALL, UNDER ANY CIRCUMSTANCES,
CREATE ANY IMPLICATION THAT THERE HAS BEEN NO CHANGE IN THE AFFAIRS OF SATILLA
SINCE THE DATE HEREOF.
-------------------------------
TABLE OF CONTENTS
<TABLE>
<CAPTION>
PAGE
----
<S> <C>
Prospectus Summary......................................................... 4
Risk Factors............................................................... 6
Satilla Financial Services................................................. 9
Proposed Market............................................................10
Proposed Business..........................................................11
Plan of Operation..........................................................14
This Offering..............................................................16
Plan of Distribution.......................................................19
Market Information and Dividends...........................................19
Use of Proceeds............................................................19
Capitalization.............................................................20
Supervision and Regulation.................................................21
Management.................................................................29
Principal Shareholders.....................................................32
The Board of Directors.....................................................35
Executive Compensation.....................................................35
Certain Transactions.......................................................38
Shares Eligible for Future Sale............................................40
Description of The Company's Capital Stock.................................41
Legal Matters..............................................................42
Experts ...................................................................42
Indemnification............................................................42
Additional Information.....................................................43
Index to Consolidated Financial Statements................................. F-1
</TABLE>
-------------------------------
UNTIL , 1999 (90 DAYS AFTER THE DATE OF THIS PROSPECTUS), ALL DEALERS
EFFECTING TRANSACTIONS IN THE REGISTERED SECURITIES, WHETHER OR NOT
PARTICIPATING IN THIS DISTRIBUTION, MAY BE REQUIRED TO DELIVER A PROSPECTUS.
THIS IS IN ADDITION TO THE OBLIGATION OF DEALERS TO DELIVER A PROSPECTUS WHEN
ACTING AS UNDER-WRITERS AND WITH RESPECT TO THEIR UNSOLD ALLOTMENTS OR
SUBSCRIPTIONS.
[LOGO]
SATILLA FINANCIAL
SERVICES, INC.
COMMON STOCK
MINIMUM OFFERING - 450,000 SHARES
MAXIMUM OFFERING - 550,000 SHARES
ORGANIZER WARRANTS
TO PURCHASE UP TO 100,000 SHARES OF
COMMON STOCK
-----------------------
PROSPECTUS
-----------------------
APRIL __, 1999
================================================================================
<PAGE> 55
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
ITEM 24. INDEMNIFICATION OF DIRECTORS AND OFFICERS
The Articles of Incorporation of Satilla Financial Services, Inc.
("Satilla" or the "Registrant") eliminate, subject to certain limited
exceptions, the personal liability of a director to Satilla or its shareholders
for monetary damage for any breach of duty as a director. There is no
elimination of liability for (i) a breach of duty involving appropriation of a
business opportunity of Satilla; (ii) an act or omission which involves
intentional misconduct or a knowing violation of law; (iii) any transaction from
which the director derives an improper personal benefit; or (iv) as to any
payments of a dividend or any other type of distribution that is illegal under
Section 14-2-832 of the Georgia Business Corporation Code (the "GBCC"). In
addition, if at any time the GBCC is amended to authorize further elimination or
limitation of the personal liability of a director, then the liability of each
director of Satilla shall be eliminated or limited to the fullest extent
permitted by such provisions, as so amended, without further action by the
shareholders, unless the provisions of the GBCC require such action. The
provision does not limit the right of Satilla or its shareholders to seek
injunctive or other equitable relief not involving payments in the nature of
monetary damages.
Satilla's Bylaws contain certain provisions which provide indemnification
to directors of Satilla that is broader than the protection expressly mandated
in Sections 14-2-852 and 14-2-857 of the GBCC. To the extent that a director or
officer of Satilla has been successful, on the merits or otherwise, in the
defense of any action or proceeding brought by reason of the fact that such
person was a director or officer of Satilla, Sections 14-2-852 and 14-2-857 of
the GBCC would require Satilla to indemnify such persons against expenses
(including attorney's fees) actually and reasonably incurred in connection
therewith. The GBCC expressly allows Satilla to provide for greater
indemnification rights to its officers and directors, subject to shareholder
approval.
The indemnification provisions in Satilla's Bylaws require Satilla to
indemnify and hold harmless any director who was or is a party or is threatened
to be made a party, to any threatened, pending or completed action, suit or
proceeding whether civil, criminal, administrative or investigative (including
any action or suit by or in the right of Satilla) because he or she is or was a
director of Satilla, against expenses (including, but not limited to, attorney's
fees and disbursements, court costs and expert witness fees), and against
judgments, fines, penalties, and amounts paid in settlement incurred by him or
her in connection with the action, suit or proceeding. Indemnification would be
disallowed under any circumstances where indemnification may not be authorized
by action of the Board of Directors, the shareholders or otherwise. The Board of
Directors of Satilla also has the authority to extend to officers, employees and
agents the same indemnification rights held by directors, subject to all the
accompanying conditions and obligations. Indemnified persons would also be
entitled to have Satilla advance expenses prior to the final disposition of the
proceeding. If it is ultimately determined that they are not entitled to
indemnification, however, such amounts would be repaid. Insofar as
indemnification for liability arising under the Securities Act of 1933, as
amended (the "Securities Act") may be permitted to officers and directors of
Satilla pursuant to the foregoing provisions, Satilla has been informed that in
the opinion of the Securities and Exchange Commission (the "Commission"), such
indemnification is against public policy as expressed in the Securities Act and
is, therefore, unenforceable.
There is no pending litigation or proceeding involving a director, officer,
employee or other agent of Satilla as to which indemnification is being sought,
nor is Satilla aware of any pending or threatened litigation that may result in
claims for indemnification by any director, officer, employee or other agent.
Satilla intends to maintain policies of directors' and officers' liability
insurance.
II-1
<PAGE> 56
ITEM 25. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION
The following table sets forth the various expenses in connection with the
issuance and distribution of the securities being registered hereby. All amounts
except the Commission registration fee are estimated.
<TABLE>
<S> <C>
Commission registration fee .................. $ 1,807
Accounting fees and expenses ................. 10,000
Legal fees and expenses....................... 50,000
Printing and engraving expenses............... 15,000
Blue sky fees and expenses.................... 10,000
Transfer agent and registrar fees and expenses 5,000
Miscellaneous................................. 8,193
--------
Total .............................. $100,000
========
</TABLE>
ITEM 26. RECENT SALES OF UNREGISTERED SECURITIES
Satilla is a newly formed corporation and has not prior to the date of
this Prospectus sold any of its securities.
ITEM 27. EXHIBITS AND FINANCIAL STATEMENT SCHEDULES.
The following exhibits are filed as a part of this Registration Statement:
<TABLE>
<CAPTION>
EXHIBIT NUMBER DESCRIPTION
-------------- -----------
<S> <C>
3.1 Articles of Incorporation of Satilla.
3.2 Bylaws of Satilla.
4.1 Specimen Stock Certificate of Satilla's Common Stock, par value $.01 per share.
4.2 Form of Organizer Warrant.
5.1 Opinion of Alston & Bird LLP.
10.1 Satilla's 1999 Long-Term Incentive Plan.
10.2 Loan Agreement, dated as of September 30, 1998, by and between Satilla, as Borrower, The Bankers Bank, as Lender,
and Satilla's organizers (the "Organizers"), as Guarantors.
10.3 Escrow Agreement, dated as of March 31, 1999, by and between Satilla and The Bankers Bank, as Escrow Agent.
10.4 Option Agreement, dated as of October 21, 1998, by and between Cecily Hill, Sheila Meadows, Melodie Page, Elese
Stover, and Jennifer Wright, as Optionors, and Satilla Community Bank (the "Bank") and/or Satilla, as Optionee,
relating to the purchase of the site for the Bank's Camden County office.
10.5 Option Agreement, dated as of October 21, 1998, by and between M. Anthony Ham, as Optionor, and the Bank and/or
Satilla relating to the purchase of the site for the Bank's Brantley County office.
23.1 Consent of Alston & Bird LLP (Included in Exhibit 5).
</TABLE>
II-2
<PAGE> 57
<TABLE>
<CAPTION>
Exhibit
Number Description
------- -----------------------------------------------------------------------
<S> <C>
23.2 Consent of Thigpen, Jones, Seaton & Co., P.C.
24.1 Power of Attorney (included in Part II of this Registration Statement).
27.1 Financial Data Schedule (for SEC use only).
99.1 Form of Subscription Agreement.
</TABLE>
ITEM 28. UNDERTAKINGS.
(a) The undersigned Registrant hereby undertakes to:
(1) File, during any period in which it offers or sell
securities, a post-effective amendment to this registration statement
to:
(i) Include any prospectus required by section
10(a)(3) of the Securities Act of 1933, as amended (the
"Securities Act");
(ii) Reflect in the prospectus any facts or events
which, individually or together, represent a fundamental
change in the information set forth in the registration
statement. Notwithstanding the foregoing; any increase or
decrease in volume of securities offered (if the total dollar
value of securities offered would not exceed that which was
registered) and any deviation from the low or high end of the
estimated maximum offering range may be reflected in the form
of prospectus filed with the Commission pursuant to Rule
424(b) if, in the aggregate, the changes in volume and price
represent no more than a 20 percent change in the maximum
aggregate offering price set forth in the "Calculation of
Registration Fee" table in the effective registration
statement; and
(iii) Include any additional or changed material
information on the plan of distribution.
(2) For determining any liability under the Securities Act,
treat each post-effective amendment that contains a form of prospectus
as a new registration statement for the securities offered in the
registration statement, and that offering of the securities at that
time as the initial bona fide offering of those securities.
(b) Insofar as indemnification for liabilities arising under the
Securities Act may be permitted to directors, officers and controlling persons
of the registrant pursuant to the foregoing provisions, or otherwise, the
registrant has been advised that in the opinion of the Securities and Exchange
Commission such indemnification is against public policy as expressed in the
Securities Act and is, therefore, unenforceable. In the event that a claim for
indemnification against such liabilities (other than the payment by the
registrant of expenses incurred or paid by a director, officer, or controlling
person of the registrant in the successful defense of any action, suit or
proceeding) is asserted by such director, officer or controlling person of the
registrant in connection with the securities being registered, the registrant
will, unless in the opinion of its counsel the matter has been settled by
controlling precedent, submit to a court of appropriate jurisdiction the
question whether such indemnification is against public policy as expressed in
the Securities Act and will be governed by the final adjudication of such issue.
(c) The undersigned Registrant hereby undertakes that:
(1) For the purposes of determining any liability under the
Securities Act, the information omitted from the form of prospectus
filed as part of this Registration Statement in reliance upon Rule
II-3
<PAGE> 58
430A and contained in a form of prospectus filed by the Registrant
pursuant to Rule 424(b)(1) or (4), or 497(h) under the Securities Act,
shall be deemed to be part of this Registration Statement as of the
time it was declared effective.
(2) For the purposes of determining any liability under the
Securities Act, each post-effective amendment that contains a form of
prospectus shall be deemed to be a new registration statement relating
to the securities offered therein and the offering of such securities
at that time shall be deemed to be the initial bona fide offering
thereof.
II-4
<PAGE> 59
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, as amended, the
Registrant has duly caused this Registration Statement to be signed on its
behalf by the undersigned, thereunto duly authorized, in the City of St. Marys,
State of Georgia, as of April 5, 1999.
SATILLA FINANCIAL SERVICES, INC.
By: /s/ Rodney E. Bennett
----------------------------------------
Name: Rodney E. Bennett
Title: President
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that each person whose signature appears
below constitutes and appoints David L. Knox, Sr., Rodney E. Bennett and Curtis
J. Tumlin, II, or any of them, his true and lawful attorney-in-fact and agent,
with full power of substitution and resubstitution, for him and in his name,
place and stead, in any and all capacities, to sign any and all amendments
(including pre-effective and post-effective amendments) to this Registration
Statement and to sign any registration statement (and any post-effective
amendments thereto) effective upon filing pursuant to Rule 462(b) under the
Securities Act of 1933, and to file the same, with all exhibits thereto, and
other documents in connection therewith, with the Securities and Exchange
Commission, granting unto said attorney-in-fact and agent full power and
authority to do and perform each and every act and thing requisite and necessary
to be done in and about the premises, as fully to all intents and purposed as he
might or could do in person, hereby ratifying and confirming that said
attorney-in-fact, agent or their substitutes may lawfully do or cause to be done
by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, as amended, this
Registration Statement has been signed below by the following persons in the
capacities indicated as of April 5, 1999.
<TABLE>
<CAPTION>
SIGNATURE TITLE
--------- -----
<S> <C>
/s/ Rodney E. Bennett President, Chief Executive Officer
- -------------------------------------------------------- and Director
Rodney E. Bennett (Principal Executive Officer)
/s/ David L. Knox, Sr. Chairman of the Board of Directors
- --------------------------------------------------------
David L. Knox, Sr.
/s/ M. Anthony Ham Vice President and Director
- -------------------------------------------------------- (Principal Accounting Officer)
M. Anthony Ham
/s/ Curtis J. Tumlin, II Secretary, Treasurer and Director
- -------------------------------------------------------- (Principal Accounting Officer)
Curtis J. Tumlin, II
/s/ Robert T. Baird Director
- --------------------------------------------------------
Robert T. Baird
</TABLE>
II-5
<PAGE> 60
<TABLE>
<S> <C>
/s/ Walter A. Bennett Director
- --------------------------------------------------------
Walter A. Bennett
/s/ Richard L. Brandon Director
- --------------------------------------------------------
Richard L. Brandon
/s/ Cecily A. Hill Director
- --------------------------------------------------------
Cecily A. Hill
/s/ Wayne E. Knox Director
- --------------------------------------------------------
Wayne E. Knox
/s/ Sheila A. Meadows Director
- --------------------------------------------------------
Sheila A. Meadows
/s/ Bill F. Raulerson Director
- --------------------------------------------------------
Bill F. Raulerson
/s/ Steve E. Rawl Director
- --------------------------------------------------------
Steve E. Rawl
</TABLE>
II-6
<PAGE> 61
EXHIBIT INDEX
<TABLE>
<CAPTION>
EXHIBIT NUMBER DESCRIPTION
-------------- -----------
<S> <C>
3.1 Articles of Incorporation of Satilla.
3.2 Bylaws of Satilla.
4.1 Specimen Stock Certificate of Satilla's Common Stock, par value $.01 per share.
4.2 Form of Organizer Warrant.
5.1 Opinion of Alston & Bird LLP.
10.1 Satilla's 1999 Long-Term Incentive Plan.
10.2 Loan Agreement, dated as of September 30, 1998, by and between Satilla, as Borrower, The Bankers Bank, as Lender,
and Satilla's organizers (the "Organizers"), as Guarantors.
10.3 Escrow Agreement, dated as of March 31, 1999 by and between Satilla and The Bankers Bank, as Escrow Agent.
10.4 Option Agreement, dated as of October 21, 1998, by and between Cecily Hill, Sheila Meadows,
Melodie Page, Elese Stover, and Jennifer Wright, as Optionors, and Satilla Community Bank (the "Bank") and/or
Satilla, as Optionee, relating to the purchase of the site for the Bank's Camden County office.
10.5 Option Agreement, dated as of October 21, 1998, by and between M. Anthony Ham, as Optionor, and
the Bank and/or Satilla relating to the purchase of the site
for the Bank's Brantley County office.
23.1 Consent of Alston & Bird LLP (Included in Exhibit 5).
23.2 Consent of Thigpen, Jones, Seaton & Co., P.C.
24.1 Power of Attorney (included in Part II of this Registration Statement).
27.1 Financial Data Schedule (for SEC use only).
99.1 Form of Subscription Agreement.
</TABLE>
II-7
<PAGE> 1
EXHIBIT 3.1
ARTICLES OF INCORPORATION
OF
SATILLA FINANCIAL SERVICES, INC.
ARTICLE I
NAME
The name of the Corporation shall be "SATILLA FINANCIAL SERVICES, INC."
(the "Corporation").
ARTICLE II
AUTHORIZED SHARES
SECTION 2.1. The Corporation shall have the authority to issue not more
than 2,000,000 shares of common voting stock ("Common Stock" or "Shares"), par
value $.01 per share, and 500,000 shares of preferred stock ("Preferred Stock,"
and, together with the Common Stock, the "Corporation Stock"), par value $.01
per share.
SECTION 2.2. The shares of Common Stock shall have unlimited voting
rights and shall be entitled, subject to any preferences of any Preferred Stock
then outstanding, to receive the net assets of the Corporation upon dissolution.
SECTION 2.3. Shares of Preferred Stock may be issued for any purpose
and in any manner permitted by law, in one or more distinctly designated series,
as a dividend or for such consideration as the Corporation's Board of Directors
may determine by resolution or resolutions from time to time adopted.
Subject to the provisions of these Articles of Incorporation and to the
provisions of the Georgia Business Corporation Code, as amended (the
"Corporation Code"), the Board of Directors is expressly authorized to fix and
state, by resolution or resolutions from time to time adopted prior to the
issuance of any shares of a particular series of Preferred Stock, the
designations, voting powers (if any), preferences, and relative, participating,
optional or other special rights, and qualifications, limitations or
restrictions thereof, including, but without limiting the generality of the
foregoing, the following:
(1) The distinctive designation and number of shares of
Preferred Stock which shall constitute a series, which number may from
time to time be increased or decreased (but not below the number of
shares of such series then outstanding), by like action of the Board of
Directors;
(2) The rate or rates and times at which dividends, if any,
shall be paid on each series of Preferred Stock, whether such dividends
shall be cumulative or
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non-cumulative, the extent of the preference, subordination or other
relationship to dividends declared or paid, or any other amounts paid
or distributed upon, or in respect of, any other class or series of
Preferred Stock or other Corporation Stock;
(3) Redemption provisions, if any, including whether or not
shares of any series may be redeemed by the Corporation or by the
holders of such series of Preferred Stock, or by either, and if
redeemable, the redemption price or prices, redemption rate or rates,
and such adjustments to such redemption price(s) or rate(s) as may be
determined, the manner and time or times at which, and the terms and
conditions upon which, shares of such series may be redeemed;
(4) Conversion, exchange, purchase or other privileges, if
any, to acquire shares of Corporation Stock of any class or series,
whether at the option of the Corporation or of the holder, and if
subject to conversion, exchange, purchase or similar privileges, the
conversion, exchange, or purchase prices or rates and such adjustments
thereto as may be determined, the manner and time or times at which
such privileges may be exercised, and the terms and conditions of such
conversion, exchange, purchase or other privilege;
(5) The rights, including the amount or amounts, if any, of
preferential or other payments to which holders of any series are
entitled upon the dissolution, winding up, voluntary or involuntary
liquidation, distribution, or sale or lease of all or substantially all
assets of the Corporation; and
(6) The terms of the sinking fund, retirement, redemption or
purchase account, if any, to be provided for such series and the
priority, if any, to which any funds or payments allocated therefor
shall have over the payment of dividends, or over sinking fund,
retirement, redemption, purchase account or other payments on, or
distributions in respect of, other series of Preferred Stock or other
classes of Corporation Stock.
All shares of the same series of Preferred Stock shall be identical in
all respects, except there may be different dates from which dividends, if any,
thereon may cumulate, if made cumulative.
Issued shares of any series of Preferred Stock which are acquired by
the Corporation may, as provided by Board of Directors' resolution or
resolutions and applicable law, be returned to authorized but unissued Preferred
Stock, either of the same or of a different series, or undesignated as to
series, and thereafter reissued. In the event the number of shares of any series
of Preferred Stock is decreased, the Board of Directors may by resolution cause
the shares representing such decrease to be designated or undesignated as to
series.
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SECTION 2.4. Dividends upon all classes and series of Shares,
including, without limitation, Preferred Stock and Common Stock, shall be
payable only when, as and if declared by the Board of Directors from funds
lawfully available therefor, which funds shall include, without limitation, the
Corporation's capital surplus. Dividends upon any class or series of Corporation
Stock may be paid in cash, property, or Shares of any class or series or other
securities or evidences of indebtedness of the Corporation or any other issuer,
as may be determined by resolution or resolutions of the Board of Directors.
ARTICLE III
PURPOSE AND POWER
The nature of the Corporation's business, and its objects, purposes and
powers are as follows:
SECTION 3.1. To purchase or otherwise acquire, to own, and to hold the
stock of banks and other corporations, and to do every act and thing covered
generally by the denominations "holding corporation" and "bank holding company,"
and especially to direct the operations of other corporations through the
ownership of stock therein;
SECTION 3.2. To purchase, subscribe for, acquire, own, hold, sell,
exchange, assign, transfer, mortgage, pledge, hypothecate or otherwise transfer
or dispose of stock, scrip, warrants, rights, bonds, securities or evidences of
indebtedness created by any other corporation or corporations organized under
the laws of any state, or any bonds or evidences of indebtedness of the United
States or any state, district, territory, dependency or county or subdivision or
municipality thereof, and to issue and exchange therefor cash, capital stock,
bonds, notes or other securities, evidences of indebtedness, or obligations of
the Corporation and while the owner thereof to exercise all rights, powers, and
privileges of ownership, including the right to vote on any shares of stock,
voting trust certificates or other instruments so owned; and
SECTION 3.3. To transact any business, to engage in any lawful act or
activity, and to exercise all powers that may now or hereafter be permitted to
corporations by the Corporation Code.
The enumeration herein of the objects and purposes of the Corporation shall not
be deemed to exclude or in any way limit by inference any powers, objects, or
purposes which the Corporation is empowered to exercise, whether expressly by
purpose, or by any of the laws of the State of Georgia or any reasonable
construction of such laws.
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ARTICLE IV
CORPORATE GOVERNANCE
The following provisions are inserted for the management of the
business and the conduct of the affairs of the Corporation, and for further
definition, limitation and regulation of the powers of the Corporation and of
the Board of Directors and shareholders:
SECTION 4.1. The business and affairs of the Corporation shall be
managed by or under the direction of the Board of Directors.
SECTION 4.2. The Board of Directors shall consist of not less than five
(5) nor more than twenty-one (21) directors. The exact number of directors shall
be fixed and determined from time to time by resolution adopted by the
affirmative vote of a majority of the Board of Directors. The initial Board of
Directors shall consist of thirteen (13) members, each of whose name and address
are as follow:
Robert T. Baird
116 Temple Terrace Road
Woodbine, GA 31569
Rodney E. Bennett
Route 3, Box 3536
Folkston, GA 31537
Walter A. Bennett
1739 Regatta Drive
Amelia Island, FL 32034
Richard L. Brandon
522 Cardinal Circle
St. Marys, GA 31558
Marshall A. Ham
P.O. Box 342
Nahunta, GA 31553
Cecily A. Hill
379 Moechel Place
St. Marys, GA 31558
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David L. Knox
712 Cinnamon Fern Trail
St. Marys, GA 31558
Wayne E. Knox
305 Commons Road
SSI, GA 31522
Sheila A. Meadows
389 Moechel Place
St. Marys, GA 31558
Bill F. Raulerson
3789 Pond View Lane
Blackshear, GA 31516
Steve E. Rawl
65 Honey Creek Lane
Waverly, GA 31565
Mary F. Slaughter
P.O. Box 453
Waynesville, GA 31566
Curtis J. Tumlin, III
P.O. Box 452
Nahunta, GA 31553
SECTION 4.3. Directors shall serve until the expiration of their term
and until their successors have been elected and qualified, subject to the
director's prior death, resignation, disqualification or removal from office.
Any vacancy on the Board of Directors that results from a newly created
directorship, and any other vacancy occurring on the Board of Directors, shall
be filled by the affirmative vote of a majority of the Board of Directors then
in offices although less than a quorum, or by a sole remaining director. A
director elected by the Board of Directors to fill a vacancy shall hold office
until the next annual meeting of shareholders. A director elected by the
shareholders to fill a vacancy shall hold office for the remaining term of the
other directors on the Board of Directors. In no case will a decrease in the
number of directors shorten the term of any incumbent director.
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SECTION 4.4. The shareholders shall not have the right to remove any
one or all of the directors except for cause and by the affirmative vote of the
holders of a majority of the outstanding Shares of the Corporation entitled to
vote generally in the election of directors ("Voting Stock").
SECTION 4.5. Notwithstanding the foregoing, whenever the holders of any
one or more classes or series of Preferred Stock that may be authorized in the
future and issued by the Corporation shall have the right, voting separately by
class or series, to elect directors at an annual or special meeting of
shareholders, the election, term of office, filling of vacancies and other
features of such directorships shall be governed by the terms of that class or
series ("Preferred Stock Designation"), and such directors so elected shall
serve annual terms and shall not be divided into classes except as expressly
provided by the Preferred Stock Designation for that class or series.
SECTION 4.6. In addition to the powers and authority herein or by
statute expressly conferred upon them, the directors are hereby empowered to
exercise all such powers and do all such acts and things as may be exercised or
done by the Corporation, subject, nevertheless, to the provisions of the
Corporation Code, these Articles of Incorporation and any Bylaws adopted by the
shareholders; provided, however, that no Bylaws hereafter adopted by the
shareholders shall invalidate any prior act of the directors which would have
been valid if such Bylaws had not been adopted.
SECTION 4.7. No action shall be taken by shareholders of the
Corporation except at an annual or special meeting of shareholders of the
Corporation or by unanimous written consent, and the right of shareholders to
act by less than unanimous written consent in lieu of a meeting is specifically
denied. Unless otherwise prescribed by law, special meetings of shareholders,
for any purpose or purposes, may be called only by (i) the Chairman of the Board
of Directors of the Corporation, (ii) the President of the Corporation, (iii)
the Secretary of the Corporation at the request in writing of a majority of the
Board of Directors, or (iv) the Secretary of the Corporation at the request in
writing of the holders of a majority of the outstanding shares of Voting Stock.
SECTION 4.8. The Board of Directors may amend the Bylaws of the
Corporation upon the affirmative vote of the number of directors required, under
the terms of the Bylaws, to take action of the Board of Directors; provided,
however, that any amendment, addition or repeal of any provision of the Bylaws
regarding indemnification of the directors, officers, employees or agents of the
Corporation shall require the affirmative vote of a majority of disinterested
directors. Shareholders may amend the Bylaws of the Corporation upon the
affirmative vote of the holders of a majority of the outstanding shares of
Voting Stock.
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ARTICLE V
CONSTITUENCY CONSIDERATIONS
In connection with the exercise of its judgment in determining what is
in the best interest of the Corporation and its shareholders when evaluating an
actual or proposed business combination, a tender or exchange offer, a
solicitation of options or offers to purchase or sell Corporation Stock by
another person, or a solicitation of proxies to vote Corporation Stock by
another person, the Corporation's Board of Directors, in addition to considering
the adequacy and form of any consideration to be paid or received in connection
with any such transaction, shall consider all of the following factors and any
other factors which it deems relevant: (i) the business and financial condition,
and earnings prospects of the acquiring person or persons, including, but not
limited to, debt service and other existing financial obligations, financial
obligations to be incurred in connection with the acquisition, and other likely
financial obligations of the acquiring person or persons, and the possible
effect of such conditions upon the Corporation and its subsidiaries and the
other elements of the communities in which the Corporation and its subsidiaries
operate or are located; (ii) the competence, experience, and integrity of the
person and their management proposing or making such actions; (iii) the
prospects for a successful conclusion of the business combination; (iv) the
Corporation's prospects as an independent entity; and (v) the social and
economic effects of the transaction or proposal on the Corporation and any of
its subsidiaries, its and their employees, depositors, loan and other customers,
creditors and the communities in which the Corporation and its subsidiaries
operate or are located. This Article V shall not be deemed to provide any
constituency the right to be considered by the Board of Directors in connection
with any transaction or matter.
ARTICLE VI
REGISTERED OFFICE AND AGENT
The initial registered office of the Corporation shall be located at
6308 Highway 40 East, St. Marys, Camden County, Georgia 31558, and the
registered agent at such address shall be David L. Knox.
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ARTICLE VII
INCORPORATOR
The name and address of the incorporator is as follows:
Steven Joel Cartee
Alston & Bird LLP
One Atlantic Center
1201 West Peachtree Street
Atlanta, Georgia 30309-3424
ARTICLE VIII
PRINCIPAL OFFICE
The mailing address of the initial principal office of the Corporation
is P.O. Box 5400, 6308 Highway 40 East, St. Marys, Georgia 31558 which is
located in Camden County, Georgia.
ARTICLE IX
LIMITATION OF DIRECTOR LIABILITY
SECTION 9.1. A director of the Corporation shall not be personally
liable to the Corporation or its shareholders for monetary damages for breach of
duty of care or other duty as a director; provided, however, that the liability
of a director shall not be eliminated or limited (i) for any appropriation, in
violation of his duties, of any business opportunity of the Corporation, (ii)
for acts or omissions which involve intentional misconduct or a knowing
violation of law, (iii) for the types of liability set forth in Section 14-2-832
of the Corporation Code, as amended, (iv) for any transaction from which the
director derived an improper personal benefit, or (v) for any act or omission
occurring before the effective date of these Articles of Incorporation.
SECTION 9.2. Any repeal or modification of the provisions of this
Article by the shareholders of the Corporation shall be prospective only, and
shall not adversely affect any limitation on the personal liability of a
director of the Corporation with respect to any act or omission occurring prior
to the effective date of such repeal or modification.
SECTION 9.3. If the Corporation Code is hereafter amended to authorize
the further elimination or limitation of the liability of directors, then the
liability of a director of the Corporation, in addition to the limitation on
personal liability provided herein, shall be limited to the fullest extent
permitted by the Corporation Code, as so amended.
SECTION 9.4. In the event that any of the provisions of this Article
(including any
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provision within a single sentence) is held by a court of competent jurisdiction
to be invalid, void or otherwise unenforceable, the remaining provisions are
severable and shall remain enforceable to the fullest extent permitted by law.
ARTICLE X
INDEMNIFICATION
SECTION 10.1. Each person who was or is made a party or is threatened
to be made a party to or is otherwise involved in any threatened, pending, or
completed action, suit or proceeding, whether civil, criminal, administrative,
arbitrative or investigative, and whether formal or informal (hereinafter a
"proceeding"), by reason of the fact:
(i) that he or she is or was a director or Board-elected officer
of the Corporation, or
(ii) that he or she, being at the time a director or Board-elected
officer of the Corporation, is or was serving at the request of the
Corporation as a director, trustee, officer, employee or agent of
another corporation or of a partnership, limited liability company,
joint venture, trust or other entity, including service with respect to
an employee benefit plan (collectively, "another entity" or "other
entity"),
whether either in case (i) or in case (ii) the basis of such proceeding is
alleged action or inaction (x) in an official capacity as a director or officer
of the Corporation, or as a director, trustee, officer, employee or agent of
such other entity, or (y) in any other capacity related to the Corporation or
such other entity while so serving as a director, trustee, officer, employee or
agent, shall be indemnified and held harmless by the Corporation to the fullest
extent permitted by the Corporation Code, as the same exist or may hereafter be
amended (but, in the case of any such amendment, with respect to alleged action
or inaction occurring prior to such amendment, only to the extent that such
amendment permits the Corporation to provide broader indemnification rights than
permitted prior thereto), against all expense, liability and loss, including
without limitation counsel fees and expenses, judgments, fines, ERISA excise
taxes or penalties and amounts paid in settlement, actually and reasonably
incurred by such person in connection therewith. The persons indemnified by this
Article X are hereinafter referred to as "indemnitees." Such indemnification as
to such alleged action or inaction shall continue as to an indemnitee who has
after such alleged action or inaction ceased to be a director or officer of the
Corporation, or director, trustee, officer, employee or agent of such other
entity, and shall inure to the benefit of the indemnitee's heirs, executors and
administrators. Notwithstanding the foregoing, except as may be provided in the
Bylaws or by the Board of Directors, the Corporation shall not indemnify any
such indemnitee in connection with a proceeding (or portion thereof) initiated
by such indemnitee unless such proceeding (or
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portion thereof) was authorized expressly by action of the Board of Directors.
The right to indemnification conferred in this Article X: (i) shall be a
contract right; (ii) shall not be affected adversely to any indemnitee by any
amendment of these Articles of Incorporation with respect to any alleged action
or inaction occurring prior to such amendment; and (iii) shall, subject to any
requirements imposed by law and the Bylaws, include the right to be paid by the
Corporation the expenses including attorneys' fees, actually and reasonably
incurred in defending any such proceeding in advance of its final disposition.
SECTION 10.2. The rights to indemnification and to the advancement of
expenses conferred in this Article X shall not be exclusive of any other right
which any person may have or hereafter acquire under any statute, these Articles
of Incorporation, bylaw, agreement, vote of shareholders or disinterested
directors or otherwise. The Bylaws may contain such other provisions concerning
indemnification, including provisions specifying reasonable procedures relating
to and conditions to the receipt by indemnitees of indemnification, provided
that such provisions are not inconsistent with the provisions of this Article X.
SECTION 10.3. The Corporation may, to the extent authorized from time
to time by the Board of Directors, grant rights to indemnification, and to the
advancement of expenses, to any other officer, employee or agent of the
Corporation (or any person serving at the Corporation's request as a director,
trustee, officer, employee or agent of another entity) or to any person who is
or was a director, officer, employee or agent of any of the Corporation's
affiliates, predecessor or subsidiary corporations or banks or of a constituent
corporation or bank absorbed by the Corporation in a consolidation or merger or
who is or was serving at the request of such affiliate, predecessor or
subsidiary corporation or bank or of such constituent corporation or bank as a
director, officer, employee or agent of another entity, in each case as
determined by the Board of Directors to the fullest extent of the provisions of
this Article X in cases of the indemnification and advancement of expenses of
directors and officers of the Corporation, or to any lesser extent (or greater
extent, if permitted by law) determined by the Board of Directors. If so
indemnified, such person shall be included in the term "indemnitee" or
"indemnitees" as used in this Article X and in the Bylaws of the Corporation.
ARTICLE XI
AMENDMENTS
The Corporation reserves the right to amend, alter or repeal any
provision contained in these Articles of Incorporation in accordance with the
applicable provisions of the Corporation Code.
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ARTICLE XII
SEVERABILITY
In the event that any of the provisions of these Articles of
Incorporation (including any provision within a single Article, Section,
Paragraph or sentence) is held by a court of competent jurisdiction to be
invalid, void or otherwise unenforceable, the remaining provisions are severable
and shall remain enforceable to the full extent permitted by law.
ARTICLE XIII
DURATION
The Corporation shall have perpetual duration and existence.
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IN WITNESS WHEREOF, the undersigned executes these Articles of
Incorporation this 18th day of December, 1998.
/s/ Steven Joel Cartee
----------------------------------
Steven Joel Cartee, Esquire
Incorporator
ALSTON & BIRD LLP
One Atlantic Center
1201 West Peachtree Street
Atlanta, Georgia 30309-3424
(404) 881-7396
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CERTIFICATE OF AN INCORPORATOR
PURSUANT TO SECTION 14-2-201.1(A) OF
THE GEORGIA BUSINESS CORPORATION CODE
Pursuant to the provisions of Section 14-2-201.1(a) of the Georgia
Business Corporation Code, the undersigned, an Incorporator for Satilla
Financial Services, Inc., hereby certifies that the request for publication of a
notice of intent to file articles of incorporation and payment therefor have
been made as required by Section 14-2-201.1(b).
The undersigned Incorporator has caused these Articles to be duly
executed this 18th day of December, 1998.
By: /s/ Steven Joel Cartee
-----------------------------------
Steven Joel Cartee, Esquire
Sole Incorporator
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EXHIBIT 3.2
BYLAWS
OF
SATILLA FINANCIAL SERVICES, INC.
Adopted as of January 7, 1999
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TABLE OF CONTENTS
<TABLE>
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Page
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<S> <C> <C> <C>
ARTICLE ONE - OFFICES AND AGENT 1
Section 1.1 Registered Office and Agent 1
Section 1.2 Other Offices 1
ARTICLE TWO - SHAREHOLDERS' MEETINGS 1
Section 2.1 Place of Meetings 1
Section 2.2 Annual Meetings 1
Section 2.3 Special Meetings 1
Section 2.4 Notice of Meetings 1
Section 2.5 Voting Group 2
Section 2.6 Quorum 2
Section 2.7 Vote Required for Action 2
Section 2.8 Voting of Shares 2
Section 2.9 Proper Business at Annual Meeting 3
Section 2.10 Proxies 3
Section 2.11 Presiding Officer 4
Section 2.12 Adjournments 4
Section 2.13 Action of Shareholders Without a Meeting 4
Section 2.14 Shareholder Lists 4
ARTICLE THREE - THE BOARD OF DIRECTORS 5
Section 3.1 General Powers 5
Section 3.2 Number, Election, Classification and Term of Office 5
Section 3.3 Nomination Procedures 5
Section 3.4 Removal 6
Section 3.5 Vacancies 6
Section 3.6 Compensation 6
ARTICLE FOUR - MEETINGS OF THE BOARD OF DIRECTORS 6
Section 4.1 Regular Meetings 6
Section 4.2 Special Meetings 6
Section 4.3 Place of Meetings 7
Section 4.4 Notice of Meetings 7
Section 4.5 Quorum 7
Section 4.6 Vote Required for Action 7
Section 4.7 Dissent or Abstention 7
</TABLE>
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<TABLE>
<S> <C> <C> <C>
Section 4.8 Participation by Conference Telephone 7
Section 4.9 Action by Directors Without a Meeting 8
Section 4.10 Adjournments 8
Section 4.11 Committees of the Board of Directors 8
Section 4.12 Transactions with Directors 9
ARTICLE FIVE - MANNER OF NOTICE AND WAIVER AS TO
SHAREHOLDERS AND DIRECTORS 9
Section 5.1 Procedure 9
Section 5.2 Waiver 10
ARTICLE SIX - OFFICERS 11
Section 6.1 Number 11
Section 6.2 Election and Term 11
Section 6.3 Compensation 11
Section 6.4 Chairman of the Board 11
Section 6.5 Vice Chairman of the Board 11
Section 6.6 President 11
Section 6.7 Vice Presidents 12
Section 6.8 Secretary 12
Section 6.9 Treasurer 12
Section 6.10 Bonds 13
Section 6.11 Execution of Instruments 13
Section 6.12 Receipts, Checks, Drafts, etc. 13
Section 6.13 Loans 13
Section 6.14 Custodian Accounts 14
ARTICLE SEVEN - DISTRIBUTIONS AND SHARE DIVIDENDS 14
Section 7.1 Authorization or Declaration 14
Section 7.2 Record Date with Regard to Distributions and
Share Dividends 14
ARTICLE EIGHT - SHARES 15
Section 8.1 Authorization and Issuance of Shares 15
Section 8.2 Share Certificates 15
Section 8.3 Rights of Corporation with Respect to Registered Owners 15
Section 8.4 Transfers of Shares 15
Section 8.5 Duty of Corporation to Register Transfer 16
Section 8.6 Lost, Stolen or Destroyed Certificates 16
Section 8.7 Fixing of Record Date with regard to Shareholder Action 16
</TABLE>
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<TABLE>
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ARTICLE NINE - INDEMNIFICATION 17
Section 9.1 Indemnification Provisions in Articles of Incorporation 17
Section 9.2 Indemnification of Others 17
Section 9.3 Undertakings for Advances for Expenses 17
Section 9.4 Claims for Indemnification 17
Section 9.5 Insurance 18
Section 9.6 Severability 18
ARTICLE TEN - MISCELLANEOUS 18
Section 10.1 Inspection of Books and Records 18
Section 10.2 Fiscal Year 18
Section 10.3 Corporate Seal 19
Section 10.4 Annual Financial Statements 19
Section 10.5 Conflict with Articles of Incorporation 19
ARTICLE ELEVEN - AMENDMENTS 19
Section 11.1 Power to Amend Bylaws 19
ARTICLE TWELVE - STATUTORY BUSINESS COMBINATION PROVISION 19
Section 12.1 Business Combinations 19
</TABLE>
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ARTICLE ONE
OFFICES AND AGENT
SECTION 1.1. REGISTERED OFFICE AND AGENT. The Corporation shall
maintain a registered office in the State of Georgia and shall have a registered
agent whose business office is identical to the registered office.
SECTION 1.2. OTHER OFFICES. In addition to its registered office, the
Corporation may have offices at any other place or places, within or without the
State of Georgia, as the Board of Directors may from time to time select or as
the business of the Corporation may require or make desirable.
ARTICLE TWO
SHAREHOLDERS' MEETINGS
SECTION 2.1. PLACE OF MEETINGS. Meetings of shareholders may be held at
any place within or without the State of Georgia as set forth in the notice
thereof or in the event of a meeting held pursuant to waiver of notice, as set
forth in the waiver, or if no place is so specified, at the principal office of
the Corporation.
SECTION 2.2. ANNUAL MEETINGS. The annual meeting of shareholders shall
be held on a date and at a time to be determined by resolution of a majority of
the Board of Directors, for the purpose of electing directors and transacting
any and all business that may properly come before the meeting. If the annual
meeting of shareholders is not held in accordance with this Section 2.2, any
business, including the election of directors, that might properly have been
acted upon at that meeting may be acted upon at a special meeting in lieu of the
annual meeting held pursuant to these Bylaws or held pursuant to a court order.
SECTION 2.3. SPECIAL MEETINGS. As provided in the Articles of
Incorporation, unless otherwise prescribed by law, special meetings of
shareholders, for any purpose or purposes, shall be called only by (i) the
Chairman of the Board of Directors of the Corporation, (ii) the President of the
Corporation, (iii) the Secretary of the Corporation at the request in writing of
a majority of the Board of Directors, or (iv) the Secretary of the Corporation
at the request in writing of the holders of at least twenty-five percent (25%)
of the outstanding shares of the capital stock of the Corporation entitled to
vote generally in the election of directors ("Voting Stock").
SECTION 2.4. NOTICE OF MEETINGS. Unless waived as contemplated in
Section 5.2, a notice of each meeting of shareholders stating the date, time and
place of the meeting shall be given not less than ten (10) days nor more than
sixty (60) days before the date thereof, by or at the direction
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of the President, the Secretary, or the officer or persons calling the meeting,
to each shareholder entitled to vote at that meeting. In the case of an annual
meeting, the notice need not state the purpose or purposes of the meeting unless
the Articles of Incorporation or the Georgia Business Corporation Code (the
"Corporation Code") requires the purpose or purposes to be stated in the notice
of the meeting. In the case of a special meeting, including a special meeting in
lieu of an annual meeting, the notice of meeting shall state the purpose or
purposes for which the meeting is called.
SECTION 2.5. VOTING GROUP. Voting group means all shares of one or more
classes or series that are entitled to vote and be counted together collectively
on a matter at a meeting of shareholders. All shares entitled to vote generally
on the matter are for that purpose a single voting group.
SECTION 2.6. QUORUM. With respect to shares entitled to vote as a
separate voting group on a matter at a meeting of shareholders, the presence, in
person or by proxy, of a majority of the votes entitled to be cast on the matter
by the voting group shall constitute a quorum of that voting group for action on
that matter unless the Articles of Incorporation or the Corporation Code
provides otherwise. Once a share is represented for any purpose at a meeting,
other than solely to object to holding the meeting or to transacting business at
the meeting, it is deemed present for quorum purposes for the remainder of the
meeting and for any adjournment of the meeting unless a new Record Date (as
defined below) is or must be set for the adjourned meeting pursuant to Section
8.7 of these Bylaws.
SECTION 2.7. VOTE REQUIRED FOR ACTION. If a quorum exists, action on a
matter by a voting group is approved if the votes cast within the voting group
favoring the action exceed the votes cast opposing the action, unless the
Articles of Incorporation, provisions of these Bylaws validly adopted by the
shareholders, or the Corporation Code requires a greater number of affirmative
votes. If the Articles of Incorporation or the Corporation Code provide for
voting by two (2) or more voting groups on a matter, action on that matter is
taken only when voted upon by each of those voting groups counted separately.
Action may be taken by one voting group on a matter even though no action is
taken by another voting group entitled to vote on the matter. With regard to the
election of directors, unless otherwise provided in the Articles of
Incorporation, if a quorum exists, action on the election of directors is taken
by a plurality of the votes cast by the shares entitled to vote in the election.
SECTION 2.8. VOTING OF SHARES. Unless the Articles of Incorporation or
the Corporation Code provides otherwise, each outstanding share having voting
rights shall be entitled to one vote on each matter submitted to a vote at a
meeting of shareholders. Voting on all matters shall be by voice vote or by show
of hands unless any qualified voter, prior to the voting on any matter, demands
vote by ballot, in which case each ballot shall state the name of the
shareholder voting and the number of shares voted by him, and if the ballot be
cast by proxy, it shall also state the name of the proxy.
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SECTION 2.9. PROPER BUSINESS AT ANNUAL MEETINGS. At any annual meeting
of the shareholders, only such business shall be conducted as shall have been
properly brought before such meeting. To be properly brought before the annual
meeting, business must be specified in the notice of meeting (or any amendment
thereto) given by or at the direction of the Board of Directors, or otherwise
properly brought before the meeting by or at the direction of the Board of
Directors, or otherwise properly brought before the meeting by a shareholder.
For business to be properly brought before an annual meeting by a shareholder,
the shareholder must have given timely notice thereof in writing to the
Secretary of the Corporation. To be timely, a shareholder's notice must be
delivered to, or mailed and received at, the principal administrative offices of
the Corporation not less than forty-five (45) days prior to the month and day of
that year corresponding to the month and day of the previous year in which the
annual meeting of shareholders was held (or at least forty-five (45) days prior
to the date of the annual meeting for that year if the date of meeting has been
publicly announced by the Corporation at least sixty (60) days in advance of
such meeting date). A shareholder's notice to the Secretary shall set forth as
to each matter the shareholder proposes to bring before the annual meeting (i) a
brief description of the business desired to be brought before the annual
meeting and the reasons for conducting such business at the annual meeting, (ii)
the name and record address of the shareholder proposing business, (iii) the
class and number of shares of the Corporation which are beneficially owned by
the shareholder and (iv) any material interest of the shareholder in such
business. The chairman of an annual meeting shall, if the facts warrant,
determine and declare to the meeting that such business was properly brought
before the meeting in accordance with these provisions. If he should determine
that such business was not properly brought before the meeting, then he shall so
declare this to the meeting and any such business not properly brought before
the meeting shall not be transacted.
SECTION 2.10. PROXIES. A shareholder entitled to vote pursuant to
Section 2.8 may vote in person or by proxy pursuant to an appointment of proxy
executed in writing by the shareholder or by his attorney in fact. An
appointment of proxy shall be valid for only one meeting to be specified
therein, and any adjournments of such meeting, but shall not be valid for more
than eleven (11) months unless expressly provided therein. Appointments of proxy
shall be dated and filed with the records of the meeting to which they relate.
If the validity of any appointment of proxy is questioned, it must be submitted
to the secretary of the meeting of shareholders for examination or a proxy
officer or committee appointed by the person presiding at the meeting. The
secretary of the meeting or, if appointed, the proxy officer or committee, shall
determine the validity or invalidity of any appointment of proxy submitted, and
reference by the secretary in the minutes of the meeting to the regularity of an
appointment of proxy shall be received as prima facie evidence of the facts
stated for the purpose of establishing the presence of a quorum at the meeting
and for all other purposes.
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SECTION 2.11. PRESIDING OFFICER. The Chairman of the Board of
Directors, or in his absence, the Vice Chairman, shall serve as the chairman of
every meeting of shareholders unless another person is elected by shareholders
to serve as chairman at the meeting. The chairman shall appoint any persons he
deems required to assist with the meeting.
SECTION 2.12. ADJOURNMENTS. Whether or not a quorum is present to
organize a meeting, any meeting of shareholders (including an adjourned meeting)
may be adjourned by the holders of a majority of the voting shares represented
at the meeting to reconvene at a specific time and place, but no later than one
hundred twenty (120) days after the date fixed for the original meeting unless
the requirements of the Corporation Code concerning the selection of a new
Record Date have been met. At any reconvened meeting within that time period,
any business may be transacted that could have been transacted at the meeting
that was adjourned. If notice of the adjourned meeting was properly given, it
shall not be necessary to give any notice of the reconvened meeting or of the
business to be transacted, if the date, time and place of the reconvened meeting
are announced at the meeting that was adjourned and before adjournment;
provided, however, that if a new Record Date is or must be fixed, notice of the
reconvened meeting must be given to persons who are shareholders as of the new
Record Date.
SECTION 2.13. ACTION OF SHAREHOLDERS WITHOUT A MEETING. As provided in
the Articles of Incorporation, no action shall be taken by shareholders of the
Corporation except at an annual or special meeting of shareholders of the
Corporation or by the unanimous written consent of all shareholders of the
Corporation, and the right of shareholders to act by less than unanimous written
consent in lieu of a meeting is specifically denied.
SECTION 2.14. SHAREHOLDER LIST. The officer who has charge of the
Corporation's stock ledger shall prepare and make at least ten (10) days before
every meeting of shareholders, a complete list of shareholders entitled to vote
at the meeting, arranged in alphabetical order, and showing the address of each
shareholder and the number of Shares registered in the name of each shareholder.
Such list shall be kept on file at the principal office of the Corporation and,
upon proper written request, shall be available for inspection by any
shareholder for proper purposes during usual business hours for a period of ten
(10) days prior to the meeting. The list of shareholders entitled to vote shall
also be produced and kept open at the time and place of the meeting during the
whole time thereof, and may be inspected by any shareholder who is present. The
original stock transfer books shall be prima facie evidence as to the
shareholders entitled to examine the shareholder list or stock transfer book, or
to vote at any meeting of shareholders.
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ARTICLE THREE
THE BOARD OF DIRECTORS
SECTION 3.1. GENERAL POWERS. All corporate powers shall be exercised by
or under the authority of, and the business and affairs of the Corporation shall
be managed by or under the direction of, the Board of Directors. In addition to
the powers and authority expressly conferred upon it by these Bylaws, the Board
of Directors may exercise all powers of the Corporation and do all lawful acts
and things that are not prohibited by law, by any legal agreement among
shareholders, by the Articles of Incorporation or by these Bylaws directed or
required to be exercised or done by the shareholders.
SECTION 3.2. NUMBER, ELECTION AND TERM OF OFFICE. As provided in the
Articles of Incorporation, the Board of Directors shall consist of not less than
five (5) nor more than twenty-one (21) directors. The exact number of directors
shall be determined from time to time by resolution adopted by the affirmative
vote of a majority of the Board of Directors. The initial directors designated
in the Articles of Incorporation shall hold office until the first annual
meeting of shareholders. Directors shall be elected at each annual meeting of
the shareholders, and shall hold office until the next succeeding annual meeting
of shareholders or until their successors are elected and qualified.
SECTION 3.3. NOMINATION PROCEDURES. Only persons who are nominated in
accordance with the following procedures shall be eligible for election as
Directors. Nominations of persons for election to the Board of Directors of the
Corporation may be made at a meeting of shareholders by or at the direction of
the Board of Directors, by any nominating committee or person appointed by the
Board of Directors or by any shareholder of the Corporation entitled to vote for
the election of directors at the meeting. Such nominations, other than those
made by or at the direction of the Board of Directors, shall be made pursuant to
timely notice in writing to the Secretary of the Corporation. To be timely, a
shareholder's notice shall be delivered to, or mailed and received at, the
principal executive offices of the Corporation not less than forty-five (45)
days prior to the month and day of that year corresponding to the month and day
of the previous year on which the annual meeting of shareholders was held or at
least forty-five (45) days prior to the date of the annual meeting for that year
if the date of such meeting has been publicly announced by the Corporation at
least sixty (60) days in advance of such meeting date. Such shareholder's notice
shall set forth (a) as to each person whom the shareholder proposes to nominate
for election or re-election as director, (i) the name, age, business address and
residence address of the person, (ii) the principal occupation or employment of
the person, (iii) the class and number of shares of the Corporation which are
beneficially owned by the person and (iv) any other information relating to the
person that is required to be disclosed in solicitations of proxies for election
of directors pursuant to Section 14(a) under the Securities Exchange Act of
1934, as amended (the "Act"), and any other applicable laws or rules or
regulations of any governmental authority or of any national securities exchange
or similar body overseeing any trading market on
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which shares of the corporation are traded, and (b) as to the shareholder giving
the notice (i) the name and record address of the shareholder and (ii) the class
and number of shares of the Corporation which are beneficially owned by the
shareholder. No person shall be eligible for election as a director of the
Corporation unless nominated in accordance with the procedures set forth herein.
The chairman of the meeting shall, if the facts warrant, determine and declare
to the meeting that a nomination was not made in accordance with the foregoing
procedure, and if he should so determine, he shall so declare to the meeting and
the defective nomination shall be disregarded.
SECTION 3.4. REMOVAL. As provided in the Articles of Incorporation, the
shareholders shall not have the right to remove any one or all of the directors
except for cause and by the affirmative vote of the holders of a majority of the
outstanding shares of the Voting Stock.
SECTION 3.5. VACANCIES. As provided in the Articles of Incorporation,
any vacancy on the Board of Directors that results from a newly created
directorship, and any other vacancy occurring on the Board of Directors, shall
be filled by the affirmative vote of a majority of the Board of Directors then
in office, although less than a quorum, or by a sole remaining director. A
director elected by the Board of Directors to fill a vacancy shall hold office
until the next annual meeting of shareholders. In no case will a decrease in the
number of directors shorten the term of any incumbent director. The election of
directors need not be by written ballot unless otherwise required by these
Bylaws.
SECTION 3.6. COMPENSATION. Unless the Articles of Incorporation provide
otherwise, the Board of Directors may determine from time to time the
compensation, if any, directors may receive for their services as directors. A
director may also serve the Corporation in a capacity other than that of
director and receive compensation, as determined by the Board of Directors, for
services rendered in any other capacity.
ARTICLE FOUR
MEETINGS OF THE BOARD OF DIRECTORS
SECTION 4.1. REGULAR MEETINGS. Regular meetings of the Board of
Directors shall be held immediately after the annual meeting of shareholders or
a special meeting in lieu of the annual meeting. In addition, the Board of
Directors may schedule other meetings to occur at regular intervals throughout
the year.
SECTION 4.2. SPECIAL MEETINGS. Special meetings of the Board of
Directors may be called by or at the request of the Chairman of the Board or the
President or by any two (2) directors in office at that time.
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SECTION 4.3. PLACE OF MEETINGS. Directors may hold their meetings at
any place within or without the State of Georgia as the Board of Directors may
from time to time establish for regular meetings or as set forth in the notice
of special meetings or, in the event of a meeting held pursuant to waiver of
notice, as set forth in the waiver.
SECTION 4.4. NOTICE OF MEETINGS. No notice shall be required for any
regularly scheduled meeting of the directors. Unless waived as contemplated in
Section 5.2 of these Bylaws, each director shall be given at least two (2) day's
notice (as set forth in Section 5.1) of each special meeting stating the date,
time, and place of the meeting.
SECTION 4.5. QUORUM. Unless a greater number is required by the
Articles of Incorporation, these Bylaws, or the Corporation code, a quorum of
the Board of Directors consists of a majority of the total number of directors
that has been prescribed by resolution of the shareholders or of the Board of
Directors pursuant to Section 3.2 of these Bylaws.
SECTION 4.6. VOTE REQUIRED FOR ACTION. If a quorum is present when a
vote is taken, the affirmative vote of a majority of directors present is the
act of the Board of Directors unless the Corporation Code, the Articles of
Incorporation, or these Bylaws require the vote of a greater number of
directors.
SECTION 4.7. DISSENT OR ABSTENTION. A director who is present at a
meeting of the Board of Directors or a committee of the Board of Directors when
corporate action is taken is deemed to have assented to the action taken unless:
(1) He objects at the beginning of the meeting (or
promptly upon his arrival) to holding it or transacting business at the meeting;
(2) His dissent or abstention from the action taken is
entered in the minutes of the meeting; or
(3) He delivers written notice of his dissent or abstention to
the presiding officer of the meeting before its adjournment or to the
Corporation immediately after adjournment of the meeting.
The right of dissent or abstention is not available to a director who votes in
favor of the action taken.
SECTION 4.8. PARTICIPATION BY CONFERENCE TELEPHONE. Any or all
directors may participate in a meeting of the Board of Directors or of a
committee of the Board of Directors through the use of any means of
communication by which all directors participating may simultaneously hear each
other during the meeting.
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SECTION 4.9. ACTION BY DIRECTORS WITHOUT A MEETING. Unless the Articles
of Incorporation or these Bylaws provide otherwise, any action required or
permitted to be taken at any meeting of the Board of Directors or action that
may be taken at a meeting of a committee of the Board of Directors may be taken
without a meeting if the action is taken by all the members of the Board of
Directors (or of the committee as the case may be). The action must be evidenced
by one or more written consents describing the action taken, signed by each
director (or each director serving on the committee, as the case may be), and
delivered to the Corporation for inclusion in the minutes or filing with the
corporate records.
SECTION 4.10. ADJOURNMENTS. Whether or not a quorum is present to
organize a meeting, any meeting of directors may be adjourned by a majority of
the directors present, to reconvene at a specific time and place. At any
reconvened meeting any business may be transacted that could have been
transacted at the meeting that was adjourned. If notice of the adjourned meeting
was properly given, it shall not be necessary to give any notice of the
reconvened meeting or of the business to be transacted, if the date, time and
place of the reconvened meeting were announced at the meeting that was
adjourned.
SECTION 4.11. COMMITTEES OF THE BOARD OF DIRECTORS.
(a) The Board of Directors by resolution may designate from among its
members an Executive Committee and one or more other committees, each consisting
of one or more directors all of whom serve at the pleasure of the Board of
Directors. Except as limited by the Corporation Code, each committee shall have
the authority set forth in the resolution establishing the committee. The
provisions of this Article Four as to the Board of Directors and its
deliberations shall be applicable to any committee of the Board of Directors.
(b) Any committee created under this Section 4.11 of the Bylaws, to the
extent provided in the resolution or resolutions of the Board of Directors and
during intervals between meetings of the Board, shall have and may exercise all
the power and authority of the Board of Directors in the management of the
business and affairs of the Corporation, and may authorize the seal of the
Corporation to be affixed to all papers which may require it; but no such
committee shall have any power or authority to: (1) declare a dividend or
distribution from capital or earned surplus; (2) issue stock of the Corporation;
(3) amend or recommend to the shareholders an amendment to the Articles of
Incorporation; (4) adopt an agreement of merger or consolidation; (5) recommend
to the shareholders the sale, lease, mortgage, or exchange or other disposition
of all or substantially all of the Corporation's property and assets; (6)
recommend to the shareholders a dissolution of the Corporation or a revocation
thereof; (7) fill vacancies in the Board of Directors; (8) amend these Bylaws;
or (9) take any other action prohibited by the Corporation Code. Such committee
or committees shall have such name or names and consist of such number of
directors, and have and may execute such powers as may be determined and
specified in the respective resolution or resolutions adopted by the Board of
Directors from time to time establishing or changing such committee. A majority
of the Board of Directors shall have
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the power to change the membership of any such committee at any time, to fill
vacancies therein and to discharge any committee or to remove any member
thereof, with or without cause, at any time.
(c) Meetings of any committee of the Board may be called by the
President, or by the chairman of the committee, at any time upon personal,
telephonic, telegraphic, written or such other notice as may be determined by
such committee. A majority of the members of each committee may fix such
committee's rules of procedure, determine its manner of acting, and fix the time
and place, whether within or without the State of Georgia, of its meetings. Each
committee shall keep regular minutes of its meetings and report the same to the
Board of Directors whenever required or requested.
SECTION 4.12. TRANSACTIONS WITH DIRECTORS. Insofar as not prohibited by
applicable law, no contract or other transaction between the Corporation and one
or more of its Directors or any other corporation, firm, association or entity
in which one or more of its Directors or officers are financially interested,
shall be either void or voidable because of such relationship or interest or
because such Director or Directors are present at the meeting of the Board of
Directors or a committee thereof which authorizes, approves or ratifies such
contract or transaction if the contract or transaction is fair and reasonable to
the Corporation and if either:
(a) The fact of such relationship or interest is disclosed to
the Board of Directors or committee which authorizes, approves or
ratifies the contract or transaction by a vote or consent sufficient
for the purpose without counting the votes or consents of such
interested directors and without considering such interested directors
as present for purposes of constituting a quorum; or
(b) The fact of such relationship or interest is disclosed to
the shareholders entitled to vote and they authorize, approve or ratify
such contract or transaction by vote or written consent.
ARTICLE FIVE
MANNER OF NOTICE AND WAIVER AS TO SHAREHOLDERS AND DIRECTORS
SECTION 5.1. PROCEDURE. Whenever these Bylaws require notice to be
given to any shareholder or director, the notice shall be given in accordance
with this Section 5.1. Notice under these Bylaws shall be in writing unless oral
notice is reasonable under the circumstances. Any notice to directors may be
written or oral. Notice may be communicated in person; by telephone, telegraph,
teletype, telecopy, or other form of wire or wireless communication; or by mail
or private carrier. If these forms of personal notice are impracticable, notice
may be communicated by a newspaper of general circulation in the area where
published, or by radio,
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television, or other form of public broadcast communication. Written notice to
the shareholders, if in a comprehensible form, is effective when mailed, if
mailed with first-class postage prepaid (other than first class mail may be used
if the Corporation has over five hundred (500) shareholders of record, and if
applicable, the notice is mailed not less than thirty (30) days before the date
of the meeting for which it is sent) and correctly addressed to the
shareholder's address shown in the Corporation's current record of shareholders.
Except as provided above, written notice, if in a comprehensible form, is
effective upon the earliest of the following:
(1) When received or when delivered, properly addressed, to the
addressee's last known principal place of business or residence;
(2) Five (5) days after its deposit in the mail, as evidenced by the
postmark, if mailed with first-class postage prepaid and correctly addressed; or
(3) On the date shown on the return receipt, if sent by registered or
certified mail, return receipt requested, and the receipt is signed by or on
behalf of the addressee.
Oral notice is effective when communicated if communicated in a comprehensible
manner. In calculating time periods for notice, when a period of time measured
in days, weeks, months, years, or other measurement of time is prescribed for
the exercise of any privilege or the discharge of any duty, the first day shall
not be counted but the last day shall be counted.
SECTION 5.2. WAIVER.
(a) A shareholder may waive any notice before or after the date and
time stated in the notice. Except as provided below in (b), the waiver must be
in writing, be signed by the shareholder entitled to the notice, and be
delivered to the Corporation for inclusion in the minutes or filing with the
corporate records.
(b) A shareholder's attendance at a meeting (i) waives objection to
lack of notice or defective notice of the meeting, unless the shareholder at the
beginning of the meeting objects to holding the meeting or transacting business
at the meeting; and (ii) waives objection to consideration of a particular
matter at the meeting that is not within the purpose or purposes described in
the meeting notice, unless the shareholder objects to considering the matter
when it is presented.
(c) Unless required by the Corporation Code, neither the business
transacted nor the purpose of the meeting need be specified in the waiver.
(d) A director may waive any notice before or after the date and time
stated in the notice. Except as provided below in (e), the waiver must be in
writing, signed by the director
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entitled to the notice, and delivered to the Corporation for inclusion in the
minutes or filing with the corporate records.
(e) A director's attendance at or participation in a meeting waives any
required notice to him of the meeting unless the director at the beginning of
the meeting (or promptly upon his arrival) objects to holding the meeting or
transacting business at the meeting and does not thereafter vote for or assent
to action taken at the meeting.
ARTICLE SIX
OFFICERS
SECTION 6.1. NUMBER. The officers of the Corporation shall consist of a
Chairman of the Board, a Vice Chairman of the Board, a President, one or more
Vice Presidents, a Secretary and a Treasurer, and any other officers as may be
appointed by the Board of Directors or appointed by a duly appointed officer
pursuant to this Article Six. The Board of Directors shall from time to time
create and establish the duties of the other officers. Any two or more offices
may be held by the same person, except that the offices of President and
Secretary may not be held by the same person.
SECTION 6.2. ELECTION AND TERM. All officers shall be appointed by the
Board of Directors or by a duly appointed officer pursuant to this Article Six
and shall serve at the pleasure of the Board of Directors or the appointing
officers, as the case may be. All officers, however appointed, may be removed
with or without cause by the Board of Directors and any officer appointed by
another officer may also be removed by the appointing officer with or without
cause.
SECTION 6.3. COMPENSATION. The compensation of all officers of the
corporation appointed by the Board of Directors shall be fixed by the Board of
Directors.
SECTION 6.4. CHAIRMAN OF THE BOARD. The Chairman of the Board of
Directors shall call to order meetings of the shareholders, the Board of
Directors and the Executive Committee and shall act as chairman of such
meetings. The Chairman of the Board shall perform such other duties as the
directors may direct from time to time.
SECTION 6.5. VICE CHAIRMAN OF THE BOARD. The Vice Chairman of the Board
shall have such authority and shall perform such duties as may be prescribed
from time to time by the Board of Directors or the Chairman of the Board.
SECTION 6.6. PRESIDENT. The President shall be the chief executive
officer of the Corporation, and subject to the control of the Board of
Directors, shall determine the Corporation's basic policies, have general
supervision of its business and affairs and be responsible
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for all internal operations of the Corporation. The President shall report to
the Board of Directors, and shall be responsible for personnel, and shall
designate and assign the duties of the officers under his supervision, at the
direction or with the approval of the Board of Directors.
The President shall have the authority to execute bonds, mortgages and
other contracts and instruments requiring a seal, under the seal of the
Corporation and shall have the authority to endorse, when sold, assigned,
transferred, or otherwise disposed of, all certificates for shares of stock,
bonds, securities or evidences of indebtedness issued by other corporations,
associations, trusts, individuals or entities, whether public or private, or by
any government or agency thereof, which are owned or held by the Corporation,
and to make, execute and deliver all instruments of assignment or transfer of
any stocks, bonds, securities, evidences of indebtedness, agreements, or other
property owned or held by the Corporation in any capacity. He shall, under the
supervision of the Board, be responsible for all investments of the Corporation
and shall have full authority to do any and all things delegated to him by the
Board of Directors or by any committee of the Board having authority.
SECTION 6.7. VICE PRESIDENTS. In the absence or disability of the
President, or at the direction of the President, the Vice President, if any,
shall perform the duties and exercise the powers of the President. If the
Corporation has more than one Vice President, the one designated by the Board
Directors shall act in lieu of the President. Vice Presidents shall perform
whatever duties and have whatever powers the Board of Directors may from time to
time assign.
SECTION 6.8. SECRETARY. The Secretary shall be responsible for
preparing minutes of the acts and proceedings of all meetings of shareholders
and, unless a secretary has been designated for such purpose, of the Board of
Directors and any committees thereof. He shall have authority to give all
notices required by law or these Bylaws. He shall be responsible for the the
corporate books, records, contracts and other documents. The Secretary may affix
the corporate seal to any lawfully executed documents and shall sign any
instruments as may require his signature. The Secretary shall authenticate
records of the Corporation. The Secretary shall perform whatever additional
duties and have whatever additional powers the Board of Directors may from time
to time assign him. In the absence or disability of the Secretary or at the
direction of the President, any Assistant Secretary may perform the duties and
exercise the powers of the Secretary.
SECTION 6.9. TREASURER. The Treasurer shall be responsible for the
custody of all funds and securities belonging to the Corporation and for the
receipt, deposit or disbursement of funds and securities under the direction of
the Board of Directors. The Treasurer shall cause to be maintained full and true
accounts of all receipts and disbursements and shall make reports of the same to
the Board of Directors and the President upon request. The Treasurer shall
perform all duties as may be assigned to him from time to time by the Board of
Directors.
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SECTION 6.10. BONDS. The Board of Directors by resolution may require
any or all of the officers, agents or employees of the Corporation to give bonds
to the Corporation, with sufficient surety or sureties, conditioned on the
faithful performance of the duties of their respective offices or positions, and
to comply with any other conditions as from time to time may be required by the
Board of Directors.
SECTION 6.11 EXECUTION OF INSTRUMENTS. The Chairman of the Board and
the President are authorized, in their discretion, and to the extent permitted
herein and by law, to do and perform any and all corporate and official acts in
carrying on the Corporation's business, including, but not limited to, the
authority to make, execute, acknowledge and deliver all deeds, mortgages,
releases, bills of sale, assignments, transfers, leases, powers of attorney or
of substitution, proxies to vote stock, or any other instrument in writing that
may be necessary in the purchase, sale, lease, assignment, transfer, management
or handling in any way of property of any description held or controlled by the
Corporation, in any capacity. This shall include authority from time to time, to
borrow money in such amounts, for such lengths of time, at such rates of
interest and upon such terms and conditions as any said officer may deem proper,
and to evidence the indebtedness thereby created by executing and delivering in
the Corporation's name, promissory notes or other appropriate evidences of
indebtedness. The enumeration herein of particular powers shall not restrict in
any way the general powers and authority of said officers. The Board may
authorize any other officer or officers or agent or agents to enter into any
contract or execute and deliver any instrument in the name of and on behalf of
the Corporation, and such authority may be delegated by the person so
authorized; but unless so authorized by the Board or these Bylaws, no officer,
agent or employee shall have any power or authority to bind the Corporation by
any contract or engagement or to pledge its credit or to render it liable for
any purpose or to any amount. The Treasurer, the Secretary or any Vice
President, Assistant Treasurer or Assistant Secretary shall be authorized to
attest the signature of the President or Chairman and to affix the corporate
seal to any and all instruments requiring such attestation or execution under
seal.
SECTION 6.12. RECEIPTS, CHECKS, DRAFTS, ETC. All checks, drafts or
other orders for the payment of money, notes or other evidences of indebtedness
issued in the name of the Corporation shall be signed by such officer or
officers, or agent or agents, as shall from time to time be determined by
resolution of the Board. The President, any Vice President, the Treasurer, any
Assistant Treasurer or any other officer or employee designated by the Board of
Directors, is authorized and empowered on behalf of the Corporation and in its
name to endorse checks and warrants, to draw drafts, to give receipts for money
due and payable to the Corporation, and to sign such other papers and do such
other acts as are necessary or appropriate to perform his duties.
SECTION 6.13. LOANS. No loan shall be contracted on behalf of the
Corporation, and no negotiable paper shall be issued in its name, unless
authorized by the Board. When so authorized, the Chairman of the Board, the
President, the Treasurer, or a Vice President specifically
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<PAGE> 18
designated by the Board, may effect loans and advances at any time for the
Corporation from any bank, trust company or other institution or from any firm,
corporation or individual, and for such loans and advances the Chairman of the
Board, the President, Treasurer or designated Vice President may make, execute
and deliver, with the counter-signature, unless otherwise authorized by the
Board, of the Secretary or an Assistant Secretary, the Treasurer or an Assistant
Treasurer, bonds, debentures, promissory notes or other evidences of
indebtedness of the Corporation and, when so authorized, as security for the
payment of any and all loans, advances, indebtedness and liabilities of the
Corporation, may mortgage, pledge, hypothecate or transfer any real or personal
property at any time held by the Corporation and to that end execute and deliver
instruments of' mortgage or pledge or which otherwise transfer such property or
an interest therein. Any authority so granted by the Board may be general or
confined to specific instances and if the Board so provides may be delegated by
the person so authorized.
SECTION 6.14. CUSTODIAN ACCOUNTS. Any two of the following officers
acting jointly, namely, the President or any Vice President, shall have the
authority to establish such custodian accounts with such banks or other
institutions as in their judgment are necessary or desirable in the conduct of
the Corporation's business, and any two of them acting jointly shall have the
authority to issue orders and instructions respecting transactions with respect
to such accounts.
ARTICLE SEVEN
DISTRIBUTIONS AND SHARE DIVIDENDS
SECTION 7.1. AUTHORIZATION OR DECLARATION. Unless the Articles of
Incorporation provide otherwise, the Board of Directors, from time to time in
its discretion, may authorize or declare distributions or share dividends in
accordance with the Corporation Code.
SECTION 7.2. RECORD DATE WITH REGARD TO DISTRIBUTIONS AND SHARE
DIVIDENDS. For the purpose of determining shareholders entitled to a
distribution (other than one involving a purchase, redemption, or other
reacquisition of the Corporation's shares) or a share dividend the Board of
Directors may fix a date as the record date (the "Record Date"). If no Record
Date is fixed by the Board of Directors, the Record Date shall be determined in
accordance with the provisions of the Corporation Code.
14
<PAGE> 19
ARTICLE EIGHT
SHARES
SECTION 8.1. AUTHORIZATION AND ISSUANCE OF SHARES. In accordance with
the Corporation Code, the Board of Directors may authorize shares of any class
or series provided for in the Articles of Incorporation to be issued for any
consideration valid under the provisions of the Corporation Code. To the extent
provided in the Articles of Incorporation, the Board of Directors shall
determine the preferences, limitations, and relative rights of the shares.
SECTION 8.2. SHARE CERTIFICATES. The interest of each shareholder in
the Corporation shall be certificated or uncertificated at the discretion of the
Board of Directors. If certificated, the certificate or certificates
representing shares of the Corporation shall be in such form as the Board of
Directors from time to time may adopt. Share certificates shall be numbered
consecutively, shall be in registered form, shall indicate the date of issuance,
the name of the Corporation and that it is organized under the laws of the State
of Georgia, the name of the shareholder, and the number and class of shares and
the designation of the series, if any, represented by the certificate. Each
certificate shall be signed by any one of the Chairman of the Board, the
President, a Vice President, the Secretary, or the Treasurer. The corporate seal
need not be affixed.
SECTION 8.3. RIGHTS OF CORPORATION WITH RESPECT TO REGISTERED OWNERS.
Prior to due presentation for transfer of registration of its shares, the
Corporation may treat the registered owner of the shares as the person
exclusively entitled to vote the shares, to receive any share dividend or
distribution with respect to the shares, and for all other purposes; and the
Corporation shall not be bound to recognize any equitable or other claim to or
interest in the shares on the part of any other person, whether or not it shall
have express or other notice thereof, except as otherwise provided by law.
SECTION 8.4. TRANSFERS OF SHARES. Transfers of shares shall be made
upon the transfer books of the Corporation kept at the office of the transfer
agent designated to transfer the shares only upon direction of the person named
as being the owner of such shares or as named in the certificate, or by an
attorney lawfully constituted in writing; and before a new certificate is
issued, if any, the old certificate, if any, shall be surrendered for
cancellation or, in the case of a certificate alleged to have been lost, stolen,
or destroyed, the requirements of Section 8.6 of these Bylaws shall have been
met.
15
<PAGE> 20
SECTION 8.5. DUTY OF CORPORATION TO REGISTER TRANSFER. Notwithstanding
any of the provisions of Section 8.4 of these Bylaws, the Corporation is under a
duty to register the transfer of its shares only if
(a) in the event that the shares are certificated, the certificate
is endorsed by the appropriate person or persons; and
(b) reasonable assurance is given that the endorsement or
affidavit is genuine and effective; and
(c) the Corporation either has no duty to inquire into adverse claims
or has discharged that duty; and
(d) the requirements of any applicable law relating to the
collection of taxes have been met; and
(e) the transfer in fact is rightful or is to a bona fide purchaser.
SECTION 8.6. LOST, STOLEN OR DESTROYED CERTIFICATES. Any person
claiming a share certificate to be lost, stolen or destroyed shall make an
affidavit or affirmation of the fact in the manner required by the Board of
Directors and, if the Board of Directors requires, shall give the Corporation a
bond of indemnity in form and amount, and with one or more sureties satisfactory
to the Board of Directors, as the Board of Directors may require, whereupon an
appropriate new certificate may be issued in lieu of the one alleged to have
been lost, stolen or destroyed.
SECTION 8.7. FIXING OF RECORD DATE WITH REGARD TO SHAREHOLDER ACTION.
For the purpose of determining shareholders entitled to notice of a
shareholders' meeting, to demand a special meeting, to vote, or to take any
other action, the Board of Directors may fix a future date as the record date,
which date shall be not more than seventy (70) days prior to the date on which
the particular action, requiring a determination of shareholders, is to be
taken. A determination of shareholders entitled to notice of or to vote at a
shareholders' meeting is effective for any adjournment of the meeting unless the
Board of Directors fixes a new record date, which it must do if the meeting is
adjourned to a date more than one hundred twenty (120) days after the date fixed
for the original meeting. If no record date is fixed by the Board of Directors,
the record date shall be determined in accordance with the provisions of the
Corporation Code.
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<PAGE> 21
ARTICLE NINE
INDEMNIFICATION
SECTION 9.1 INDEMNIFICATION PROVISIONS IN ARTICLES OF INCORPORATION.
The provisions of this Article 9 are intended to supplement Article X of the
Articles of Incorporation pursuant to Sections 10.2 and 10.3 thereof. To the
extent that this Article 9 contains any provisions inconsistent with said
Article X, the provisions of the Articles of Incorporation shall govern. Terms
defined in such Article X shall have the same meaning in this Article 9.
SECTION 9.2 INDEMNIFICATION OF OTHERS. The Corporation may indemnify
and advance expenses to its other officers, employees and agents to the same or
any lesser extent as to its directors and Board-elected officers, as set forth
in the Articles of Incorporation and in this Article 9 of the Bylaws of the
Corporation, and, if so indemnified, such persons shall be included in the term
"indemnitee" or "indemnitees" as used in this Article 9 of the Bylaws.
SECTION 9.3 UNDERTAKINGS FOR ADVANCES OF EXPENSES. If and to the extent
the Corporation Code requires, an advancement by the Corporation of expenses
incurred by an indemnitee pursuant to clause (iii) of the last sentence of
Section 10.1 of the Articles of Incorporation (hereinafter an "advancement of
expenses") shall be made only upon delivery to the Corporation of an undertaking
(hereinafter an "undertaking"), by or on behalf of such indemnitee, to repay all
amounts so advanced if it shall ultimately be determined by final judicial
decision from which there is no further right to appeal (hereinafter a "final
adjudication") that such indemnitee is not entitled to be indemnified for such
expenses under Article X of the Articles of Incorporation or otherwise.
SECTION 9.4 CLAIMS FOR INDEMNIFICATION. If a claim for indemnification
under Section 10.1 of the Articles of Incorporation is not paid in full by the
Corporation within sixty (60) days after it has been received in writing by the
Corporation, except in the case of a claim for an advancement of expenses, in
which case the applicable period shall be twenty (20) days, the indemnitee may
at any time thereafter bring suit against the Corporation to recover the unpaid
amount of the claim. If the indemnitee is successful in whole or in part in any
such suit, or in a suit brought by the Corporation to recover an advancement of
expenses pursuant to the terms of an undertaking, the indemnitee shall be
entitled to be paid also the expense of prosecuting or defending such suit. In
any suit brought by the indemnitee to enforce a right to indemnification
hereunder (but not in a suit brought by the indemnitee to enforce a right to an
advancement of expenses) it shall be a defense that, and in any suit by the
Corporation to recover an advancement of expenses pursuant to the terms of an
undertaking, the Corporation shall be entitled to recover such expenses only
upon a final adjudication that, the indemnitee is not entitled to
indemnification by reason of Section 14-2-856(b) of the Corporation Code or any
successor provision or provisions. Neither the failure of the Corporation,
including the Board of Directors, independent legal counsel, or its
shareholders, to have made a determination prior to the commencement of
17
<PAGE> 22
such suit that indemnification of the indemnitee is proper in the circumstances
because the indemnitee is not entitled to indemnification by reason of Section
14-2-856(b) of the Corporation Code or any successor provision or provisions,
nor an actual determination by the Corporation, including the Board of
Directors, special legal counsel, or its shareholders, that the indemnitee is
not entitled to indemnification by reason of such statutory limit, shall create
a presumption that the indemnitee has not met the applicable standard of conduct
or, in the case of such a suit brought by the indemnitee, be a defense to such
suit.
In any suit brought by the indemnitee to enforce a right to
indemnification or to an advancement of expenses hereunder, or by the
Corporation to recover an advancement of expenses pursuant to the terms of an
undertaking, the burden of proving that the indemnitee is not entitled to be
indemnified, or to have or retain such advancement of expenses, under Article X
of the Articles of Incorporation or this Article 9 or otherwise, shall be on the
Corporation.
SECTION 9.5 INSURANCE. The Corporation may maintain insurance, at its
expense, to protect itself and any director, trustee, officer, employee or agent
of the Corporation or another entity against any expense, liability or loss,
whether or not the Corporation would have the power to indemnify such person
against such expense, liability or loss under the Corporation Code.
SECTION 9.6 SEVERABILITY. In the event that any of the provisions of
this Article 9 (including any provision within a single section, paragraph or
sentence) is held by a court of competent jurisdiction to be invalid, void or
otherwise unenforceable, the remaining provisions are severable and shall remain
enforceable to the full extent permitted by law.
ARTICLE TEN
MISCELLANEOUS
SECTION 10.1. INSPECTION OF BOOKS AND RECORDS. The Board of Directors
shall have the power to determine which accounts, books and records of the
Corporation shall be opened to inspection by shareholders, except those as may
by law specifically be made open to inspection, and shall have the power to fix
reasonable rules and regulations not in conflict with the applicable law for the
inspection of accounts, books and records which by law or by determination of
the Board of Directors shall be open to inspection. Absent the prior approval of
the Board of Directors in their discretion, the right of inspection set forth in
Section 14-2-1602 of the Corporation Code, as amended, shall only be available
to the extent provided for in such Section and only to shareholders meeting the
requirements of such Section.
SECTION 10.2. FISCAL YEAR. The Board of Directors is authorized to fix
the fiscal year of the Corporation and to change the same from time to time as
it deems appropriate.
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<PAGE> 23
SECTION 10.3. CORPORATE SEAL. If the Board of Directors determines that
there should be a corporate seal for the Corporation, it shall be in the form as
the Board of Directors may from time to time determine.
SECTION 10.4. ANNUAL FINANCIAL STATEMENTS. In accordance with the
Corporation Code, the Corporation shall prepare and provide to shareholders such
financial statements as may be required by the Corporation Code.
SECTION 10.5. CONFLICT WITH ARTICLES OF INCORPORATION. In the event
that any provision of these Bylaws conflicts with any provision of the Articles
of Incorporation, the Articles of Incorporation shall govern.
ARTICLE ELEVEN
AMENDMENTS
SECTION 11.1. POWER TO AMEND BYLAWS. The Board of Directors may amend
the Bylaws of the Corporation upon the affirmative vote of the number of
directors required, under the terms of the Bylaws, to take action of the Board
of Directors; provided, however, that any amendment, addition or repeal of any
provision of the Bylaws regarding indemnification of the directors, officers,
employees or agents of the Corporation shall require the affirmative vote of a
majority of the disinterested directors. Shareholders may not amend the Bylaws
of the Corporation except upon the affirmative vote of the holders of a majority
of the outstanding shares of Voting.
ARTICLE TWELVE
STATUTORY BUSINESS COMBINATION PROVISION
SECTION 12.1. BUSINESS COMBINATIONS. The requirements of Part 3 of
Article 11 of the Corporation Code shall not apply to the Corporation. The
Corporation hereby expressly elects not to be governed by the Business
Combination provisions of Part 3 of Article 11 of the Corporation Code.
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<PAGE> 1
EXHIBIT 4.1
NUMBER SHARES
21
SATILLA FINANCIAL SERVICES, INC.
INCORPORATED UNDER THE LAWS OF THE STATE OF GEORGIA
AUTHORIZED COMMON STOCK
THIS CERTIFIES THAT _____________________________________________ is the
registered holder of ____________________________________________Shares
OF THE AUTHORIZED COMMON STOCK OF SATILLA FINANCIAL SERVICES, INC. WHICH
ARE FULLY PAID AND NON-ACCESSIBLE AND WHICH ARE
transferable only on the books of the Corporation by the holder hereof in person
or by Attorney upon surrender of this Certificate properly endorsed.
IN WITNESS WHEREOF, the said Corporation has caused this Certificate to be
signed by its duly authorized officers and its Corporate Seal to be hereunto
affixed this __________day of __________A.D. 19__.
_______________________________ _____________________________
President Secretary
$0.01
PAR
VALUE
<PAGE> 2
- --------------------------------------------------------------------------------
The following abbreviations, when used in the inscription on the face of
this certificate, shall be construed as though they were written out in full
according to applicable laws or regulations.
TEN COM - as tenants in common UNIF GIFT MIN ACT - _____Custodian _____
TEN ENT - as tenants by the entireties (Cust) (Minor)
JT TEN - as joint tenants with right under Uniform Gifts to Minors
survivorship and not as tenants Act ______________________
in common (State)
Additional abbreviations may also be used though not in the above list.
FOR VALUE RECEIVED, _____________________ hereby sell, assign and transfer
unto
PLEASE INSERT SOCIAL SECURITY OR OTHER
IDENTIFYING NUMBER OF ASSIGNED
- --------------------------------------
- -------------------------------------- _________________________________________
________________________________________________________________________________
PLEASE PRINT OR TYPEWRITE NAME AND ADDRESS OF ASSIGNEE
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________Shares
represented by the within Certificate, and do hereby irrevocably constitute
and appoint ____________________________________________________________________
________________________________________________________________________________
Attorney to transfer the said shares on the books of the within-named
Corporation with full power of substitution in the premises.
Dated, __________________________________
__________________________________
In presence of
_________________________________________
NOTICE: THE SIGNATURE TO THIS ASSIGNMENT MUST CORRESPOND WITH THE NAME AS
WRITTEN UPON THE FACE OF THE CERTIFICATE IN EVERY PARTICULAR, WITHOUT
ALTERATION OR ENLARGEMENT, OR ANY CHANGE WHATEVER.
<PAGE> 1
EXHIBIT 4.2
THIS WARRANT SHALL BE NON-TRANSFERABLE, EXCEPT IN THE CASE OF THE HOLDER'S
DEATH, AND THEREUPON ONLY BY WILL OR UNDER THE LAWS OF DESCENT AND DISTRIBUTION.
UPON THE DEATH OF THE HOLDER, THE DECEASED HOLDER'S LEGAL OR PERSONAL
REPRESENTATIVE, OR ANY PERMITTED TRANSFEREE OF THIS WARRANT SHALL, WITHIN 30
DAYS OF THE HOLDER'S DEATH, NOTIFY THE COMPANY OF SUCH EVENT AND THE NEW
HOLDER'S NAME, ADDRESS AND CAPACITY IN WHICH THIS WARRANT IS HELD. SUCH
PERMITTED TRANSFEREE WILL BE SUBJECT TO, AND BOUND BY, THE TERMS AND PROVISIONS
OF THIS WARRANT TO THE SAME EXTENT AS THE ORIGINAL HOLDER.
WARRANT TO PURCHASE
SHARES OF COMMON STOCK
OF
SATILLA FINANCIAL SERVICES, INC.
DATE OF INITIAL ISSUANCE: __________________, 1999
THIS CERTIFIES THAT, for value received, _____________________________
(the "Holder") is entitled to purchase, subject to the exercise and other
provisions of this Warrant, from Satilla Financial Services, Inc. (the
"Company") at any time prior to March 31, 2009, up to _______________ shares (as
such number of shares may be adjusted in accordance with Section 2 hereof, the
"Warrant Shares") of the Company's common stock, par value $.01 per share (the
"Common Stock"), at any time and from time to time, in whole or in part, at an
exercise price per share of $10.00 (subject to adjustment as provided in Section
2 hereof, the "Exercise Price"). This Warrant shall expire on March 31, 2009.
SECTION 1. EXERCISE OF WARRANT.
1.1. Vesting. The Holder's rights under this Warrant are fully
vested as of the date hereof.
1.2. Exercisability. This Warrant shall become exercisable on the
third anniversary of date hereof, unless required pursuant to Section 3.4
hereof.
<PAGE> 2
1.3. Procedure for Exercise of Warrant.
(a) To exercise this Warrant in whole or in part, the Holder shall
deliver to the Company at any time prior to March 31, 2009: (i) a completed and
signed Notice of Exercise (including the Substitute Form W-9, which forms a part
thereof), as attached hereto as Schedule A; (ii) cash or a certified or official
bank check, payable to the order of the Company in the amount of the aggregate
Exercise Price for the Warrant Shares being purchased; and (iii) this Warrant.
Upon irrevocable payment in good collected funds of the aggregate Exercise Price
(rounded up to the nearest cent) for the Warrant Shares being purchased, the
Holder shall be deemed to be the holder of record of such Warrant Shares,
notwithstanding that the stock transfer books of the Company may then be closed
or that certificates representing such Warrant Shares may not then be actually
delivered to the Holder.
(b) The Company shall, as promptly as practicable after completion of
the actions specified in Section 1.3(a), cause to be executed, and deliver to
the Holder a certificate representing the aggregate number of Warrant Shares
specified in the Notice of Exercise. Each stock certificate so delivered shall
be in such denomination as may be requested by the Holder and shall be
registered in the name of the Holder. If this Warrant shall have been exercised
only in part, the Company shall, at the time of delivery of said stock
certificate or certificates, deliver to the Holder a new Warrant evidencing the
right of the Holder to purchase the remaining shares of Common Stock covered by
this Warrant. The Company shall pay all expenses, stock transfer taxes and other
charges payable in connection with the preparation, execution and delivery of
such stock certificates.
1.4. Restrictive Legend. Each certificate for Warrant Shares shall
contain the following legend:
"THE SHARES REPRESENTED BY THIS CERTIFICATE ARE SUBJECT TO:
(I) THE PROVISIONS OF THE WARRANT AGREEMENT, DATED AS OF ____________,
1999, BY AND BETWEEN SATILLA FINANCIAL SERVICES, INC. AND THE HOLDER OF
SUCH WARRANT AGREEMENT, AND (II) THE RESALE RESTRICTIONS OF RULE 144 OF
THE SECURITIES ACT OF 1933, AS AMENDED, AS THEY RELATE TO AFFILIATES OF
THE COMPANY, A SUMMARY OF WHICH RESTRICTIONS ARE INCLUDED IN THE
COMPANY'S PROSPECTUS, DATED ________________, 1999, COVERING THE OFFER
AND SALE OF THE WARRANT. COPIES OF THE WARRANT AND A SUMMARY
DESCRIPTION OF SUCH RESALE RESTRICTIONS MAY BE OBTAINED FROM THE
COMPANY."
1.5. Character of Warrant Shares. The Company represents and warrants
that all Warrant Shares shall be duly authorized, validly issued, and, upon
payment of the Exercise Price therefor, fully paid and nonassessable.
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<PAGE> 3
SECTION 2. CERTAIN ADJUSTMENTS
2.1. Stock Dividends, Subdivisions and Combinations. If at any time the
Company shall:
(i) establish a record date for the determination of holders
of record of its Common Stock for the purpose of entitling them to
receive a dividend payable in, or other distribution of, additional
Shares of the Company's Common Stock,
(ii) subdivide its outstanding shares of Common Stock into a
larger number of shares of Common Stock, or
(iii) combine its outstanding shares of Common Stock into a
smaller number of shares of Common Stock,
then (I) the Warrant Shares for which this Warrant is exercisable immediately
after the occurrence of any such event shall be adjusted to equal the number of
shares of Common Stock which a record holder of the same number of shares of
Common Stock for which this Warrant is exercisable immediately prior to the
occurrence of such event would own or be entitled to receive after the happening
of such event, and (II) the Exercise Price shall be adjusted to equal (x) the
Exercise Price multiplied by the Warrant Shares for which this Warrant is
exercisable immediately prior to the adjustment divided by (y) the Warrant
Shares for which this Warrant is exercisable immediately after such adjustment.
2.2. Adjustment Procedures. The following provisions shall be
applicable to adjustments to be made pursuant to Section 2.1 hereof:
(a) When Adjustments to be Made. The adjustments required by
this Section 2 shall be made whenever and as often as any event
requiring an adjustment shall occur. For the purpose of any such
adjustment, any event shall be deemed to have occurred at the close of
business on the date of its occurrence.
(b) Fractional Interests. In computing adjustments under this
Section 2, fractional interests in the Common Stock shall be taken into
account to the nearest 1/10th of a share. In no event, however, shall
fractional shares or scrip representing fractional shares be issued
upon the exercise of this Warrant. In lieu thereof, a cash payment
shall be made to the Holder in an amount equal to such fraction
multiplied by the Exercise Price per share.
(c) When Adjustment Not Required. If the Company shall
establish a record date for the determination of the holders of record
of the Common Stock for the purpose of entitling such holders to
receive a dividend payable in Common Stock and shall, thereafter and
before the distribution to shareholders thereof, legally abandon its
plan to pay or deliver such dividend, then no adjustment shall be
required by reason of the
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<PAGE> 4
establishment of such record date and any such adjustment previously
made in respect thereof shall be rescinded and annulled.
2.3. Reorganization, Reclassification, Merger, Consolidation or
Share Exchange. If the Company at any time reorganizes or reclassifies the
outstanding shares of Common Stock (other than a change in par value, or from no
par value to par value, or from par value to no par value, or as a result of a
subdivision or combination) or consolidates with, merges into, or effects a
share exchange with, another corporation (where the Company is not the
continuing corporation after such merger or consolidation), the Holder shall
thereafter be entitled to receive upon exercise of this Warrant in whole or in
part, the same kind and number of shares of stock and other securities, cash or
other property (and upon the same terms and with the same rights) as would have
been distributed to the Holder upon such reorganization, reclassification,
consolidation, merger or share exchange had the Holder exercised this Warrant
immediately prior to such reorganization, reclassification, consolidation,
merger or share exchange (subject to subsequent adjustments under this Section
2), and the Exercise Price shall be adjusted appropriately to reflect such
action and adjustment.
If any such reorganization, reclassification, consolidation, merger or
share exchange results in a cash distribution in excess of the Exercise Price
provided by this Warrant, the Holder may, at the Holder's option, exercise this
Warrant without making payment of the Exercise Price, and in such case the
Company or its successors and assigns shall, upon distribution to such Holder,
consider the Exercise Price to have been paid in full, and in making settlement
to such Holder, shall deduct an amount equal to the Exercise Price from the
amount payable to such Holder. Notwithstanding anything herein to the contrary,
the Company will not effect any such reorganization, reclassification, merger,
consolidation or share exchange unless prior to the consummation thereof, the
corporation that may be required to deliver any stock, securities or other
assets upon the exercise of this Warrant shall agree by an instrument in writing
to deliver such stock, cash, securities or other assets to the Holder. A sale,
transfer or lease of all or substantially all of the assets of the Company to
another person shall be deemed a reorganization, reclassification,
consolidation, merger or share exchange for the foregoing purposes.
2.4. Officer's Certificate. Upon each adjustment of the Exercise
Price and the Warrant Shares issuable upon the exercise of this Warrant, and in
the event of any change in the rights of the Holder by reason of other events
herein set forth, then and in each such case, the Company will promptly prepare
a certificate of a responsible officer of the Company, stating the adjusted
Exercise Price, the adjusted number of Warrant Shares so issuable, and setting
forth in reasonable detail the method of calculation and the facts upon which
such calculation is based. The Company will promptly mail a copy of such
certificate to the Holder. Such calculation shall be final and binding on the
parties and shall be conclusive evidence of the correctness of the computation
with respect to any such adjustment of the Exercise Price and any such change in
the number of Warrant Shares so issuable, absent manifest error.
2.5 Notice of Certain Proposed Actions. In the event the Company
shall propose to take any action of the types described in Sections 2.1 or 2.3,
the Company shall forward, at the same time and in the same manner, to the
Holder such notice and related proxy or other materials,
-4-
<PAGE> 5
if any, that the Company gives to the holders of Company Common Stock. Failure
to give such notice, or any defect therein, however, shall not affect the
legality or validity of any such action.
SECTION 3. OWNERSHIP AND TRANSFER.
3.1. Ownership. The Company may deem and treat the person in whose
name this Warrant is registered as the Holder and owner hereof (notwithstanding
any notations of ownership or writing hereon made by anyone other than the
Company) for all purposes and shall not be affected by any notice to the
contrary until presentation of this Warrant to the Company for registration of
transfer as provided in Section 3.2.
3.2. Non-Transferable. This Warrant shall be non-transferable,
except in the case of the Holder's death, and thereupon only by will or under
the laws of descent and distribution. Upon the death of the Holder, the deceased
Holder's heirs, legal or personal representative, or any permitted transferee of
this Warrant shall, within 30 days of the Holder's death, notify the Company of
such event and the new holder's name, address and capacity in which this Warrant
is held, and present letters testamentary, a death certificate and such other
information as the Company may reasonably request to ascertain the authority of
such person. Such permitted transferee will be subject to, and bound by, the
terms and provisions of this Warrant to the same extent as the original Holder.
3.3. Replacement. Upon receipt by the Company of evidence
reasonably satisfactory to it of the loss, theft or destruction of this Warrant,
and of indemnity or security reasonably satisfactory to it, or upon surrender of
this Warrant if mutilated, the Company will make and deliver a new Warrant of
like tenor, in lieu of this Warrant. This Warrant shall be promptly canceled by
the Company upon the surrender hereof in connection with any transfer or
replacement. Except as otherwise provided above in the case of the loss, theft
or destruction of a Warrant, the Company shall pay all expenses, taxes and other
charges payable in connection with any transfer or replacement of this Warrant.
3.4 Directed Exercise, Call or Forfeiture by Regulatory Agencies.
In the event that the Georgia Department of Banking and Finance (the
"Department"), the Federal Deposit Insurance Corporation (the "FDIC") or the
Board of Governors of the Federal Reserve together with its delegees (the
"Federal Reserve," and, collectively with the Department and the FDIC, the
"Regulators") determine that the capital of the Company or of any of its banking
subsidiaries, including, without limitation, Satilla Community Bank, a
Georgia-chartered commercial bank, is inadequate in light of such Regulator's
minimum capital requirements, such Regulator shall be entitled to direct the
exercise, call or complete forfeiture of the Holder's rights under this Warrant,
and the Company shall notify the Holder promptly upon any such action by a
Regulator.
-5-
<PAGE> 6
SECTION 4. MISCELLANEOUS.
4.1 Reservation of Shares. The Company covenants that during the
period the Warrant is outstanding, it will reserve from its authorized and
unissued Common Stock a sufficient number of shares to provide for the issuance
of Common Stock upon the exercise of this Warrant.
4.2 No Rights as Shareholder; Limitation of Liability. This
Warrant shall not entitle the Holder to any of the rights of a shareholder of
the Company prior to exercise of this Warrant and irrevocable payment in good,
collected funds of the Exercise Price therefor.
4.3 Amendment. This Warrant may only be modified or amended and
any provision hereof may only be waived by a writing executed by the Company and
the Holder of this Warrant.
4.4 Successors and Assigns. This Warrant shall be binding upon,
and inure to the benefit of, the parties hereto and their respective success and
assigns permitted hereunder, and no other parties shall have any rights
hereunder.
4.5 Governing Law. This Warrant shall be governed by, and
construed and enforced in accordance with, the laws of the State of Georgia.
4.6 Entire Agreement. Except as otherwise expressly provided
herein, this Warrant (including the documents and instruments referred to
herein) constitutes the entire agreement between the parties hereto with respect
to the transactions contemplated hereunder and supersedes all prior arrangements
or understandings with respect thereto, written or oral.
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<PAGE> 7
IN WITNESS WHEREOF, the parties hereto have set their hands as of the
date first written above.
SATILLA FINANCIAL SERVICES, INC.
By:
------------------------------------
Name: Rodney E. Bennett
Title: President
By:
------------------------------------
Name: David L. Knox, Sr.
Title: Chairman
THE HOLDER
------------------------------------
Name:
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<PAGE> 8
SCHEDULE A
NOTICE OF EXERCISE
OF WARRANT TO PURCHASE COMMON STOCK OF
SATILLA FINANCIAL SERVICES, INC.
To: Satilla Financial Services, Inc.
The undersigned, the registered owner of this Warrant, hereby
irrevocably elects to exercise the purchase rights represented thereby for, and
to purchase thereunder, _________ shares of Common Stock of Satilla Financial
Services, Inc. and herewith makes payment of $__________ therefor, and requests
that the certificates evidencing such shares be issued in the name of and be
delivered to:
Name:
------------------------------------------
Address: ------------------------------------------
------------------------------------------
------------------------------------------
Social Security or
Tax I.D. Number: ------------------------------------------
and if such shares shall not be all of the shares purchasable hereunder, that a
new Warrant of like tenor for the balance of the shares purchasable hereunder be
delivered to the undersigned.
Dated:
------------------
NAME OF HOLDER
By:
----------------------------------------
Name:
<PAGE> 9
SUBSTITUTE FORM W-9
Under the penalties of perjury, I certify that:
(1) the Social Security Number or Taxpayer Identification Number
given below is correct; and
(2) I am not subject to backup withholding either because I have
not been notified that I am subject to backup withholding as a result
of a failure to report all interest or dividends, or because the
Internal Revenue Service has notified me that I am no longer subject to
backup withholding.
IMPORTANT INSTRUCTIONS: You must cross out #2 above if you have been notified by
the Internal Revenue Service that you are subject to backup withholding because
of under reporting interest or dividends on your tax return and if you have not
received a notice from the Internal Revenue Service advising you that backup
withholding due to notified payee under reporting has terminated. For additional
instructions, please refer to the attached "Guidelines for Certification of
Taxpayer Identification Number on Substitute Form W-9."
SIGNATURE*
-----------------------------------
DATE:
-----------------------,
- ----------------------
* If a corporation, please sign in full corporate name by president or other
authorized officer. When signing as officer, attorney, custodian, trustee,
administrator, guardian, etc., please give your full title as such. In case of
joint tenants, each person must sign.
THIS NOTICE OF EXERCISE SHALL NOT BE GIVEN EFFECT
BY THE COMPANY UNLESS THE HOLDER OF THE UNDERLYING
WARRANT HAS PROPERLY COMPLETED AND SIGNED BOTH
THE NOTICE OF EXERCISE FORM AND THE SUBSTITUTE FORM W-9.
<PAGE> 1
EXHIBIT 5.1
[ALSTON & BIRD LLP LETTERHEAD]
April 5, 1999
Satilla Financial Services, Inc.
180 Mariners Drive
Kingsland, Georgia 31548
Re: Registration Statement on Form SB-2
-----------------------------------
Ladies and Gentlemen:
We have acted as counsel to Satilla Financial Services, Inc., a Georgia
corporation (the "Company"), in connection with the filing of the
above-referenced Registration Statement (as amended through the date hereof, the
"Registration Statement") with the Securities and Exchange Commission (the
"Commission") to register under the Securities Act of 1933, as amended (the
"Act"), shares of the Company's Common Stock, par value $0.01 per share (the
"Shares").
We have examined the Company's Articles of Incorporation and Bylaws,
records of proceedings of the Board of Directors, or committees thereof, and the
Registration Statement. We also have examined originals or copies, certified or
otherwise identified to our satisfaction, of such other corporate records and
documents of the Company, such certificates of officers of the Company and
public officials, and such other records and documents as we have deemed
necessary or appropriate as a basis for the opinions hereinafter expressed. In
such examination, we have assumed the genuineness of all signatures, the legal
capacity of all natural persons, the authenticity and completeness of all
documents submitted to us as originals, the conformity to original documents of
all documents submitted to us as certified, conformed, photostatic or facsimile
copies, and the authenticity of the originals of such copies, and we have
assumed all certificates of public officials to have been properly given and to
be accurate.
<PAGE> 2
Satilla Financial Services, Inc.
April 5, 1999
Page 2
On the basis of the foregoing, and subject to the limitations set forth
herein, we are of the opinion that the shares of Common Stock covered by the
Registration Statement have been legally authorized and, when paid for, issued
and sold in accordance with the terms described in the Registration Statement,
will be validly issued, fully paid and nonassessable.
We consent to the filing of this opinion letter as an exhibit to the
Registration Statement and to the use of our name under the heading "Legal
Matters" in the Prospectus constituting a part thereof. In giving such consent,
we do not thereby admit that we are within the category of persons whose consent
is required under Section 7 of the Act or the rules and regulations of the
Commission thereunder.
This opinion letter is being furnished by us to the Company solely in
connection with the Registration Statement and is not to be used, reproduced,
circulated, quoted or otherwise relied upon by any other person for any other
purpose, without our prior express written consent. No opinion may be implied or
inferred beyond those expressly stated. This opinion letter is rendered as of
the date hereof, and we have no obligation to update this opinion letter.
Sincerely,
ALSTON & BIRD LLP
By: /s/ Ralph F. MacDonald, III
----------------------------------
A Partner
<PAGE> 1
EXHIBIT 10.1
SATILLA FINANCIAL SERVICES, INC.
1999 LONG-TERM INCENTIVE PLAN
ARTICLE I
PURPOSE
1.1 GENERAL. The purpose of the Satilla Financial Services, Inc.
1999 Long-Term Incentive Plan (the "Plan") is to promote the success, and
enhance the value, of Satilla Financial Services, Inc. (the "Company"), by
linking the personal interests of its employees and officers to those of Company
shareholders and by providing such persons with an incentive for outstanding
performance. The Plan is further intended to provide flexibility to the Company
in its ability to motivate, attract, and retain the services of employees and
officers upon whose judgment, interest, and special effort the successful
conduct of the Company's operation is largely dependent. Accordingly, the Plan
permits the grant of incentive awards from time to time to selected employees
and officers.
ARTICLE 2
EFFECTIVE DATE
2.1 EFFECTIVE DATE. The Plan shall be effective as of the date
upon which it shall be approved by the shareholders of the Company.
ARTICLE 3
DEFINITIONS
3.1 DEFINITIONS. When a word or phrase appears in this Plan with
the initial letter capitalized, and the word or phrase does not commence a
sentence, the word or phrase shall generally be given the meaning ascribed to it
in this Section or in Section 1.1 unless a clearly different meaning is required
by the context. The following words and phrases shall have the following
meanings:
(a) "Award" means any Option, Stock Appreciation Right,
Restricted Stock Award, Performance Unit Award, Dividend Equivalent
Award, or Other Stock-Based Award, or any other right or interest
relating to Stock or cash, granted to a Participant under the Plan.
(b) "Award Agreement" means any written agreement,
contract, or other instrument or document evidencing an Award.
(c) "Board" means the Board of Directors of the Company.
<PAGE> 2
(d) "Change in Control" means and includes each of the
following:
(1) The acquisition by any individual, entity or
group (within the meaning of Section 13(d)(3) or 14(d)(2) of
the 1934 Act) (a "Person") of beneficial ownership (within the
meaning of Rule 13d-3 promulgated under the 1934 Act) of 25%
or more of the combined voting power of the then outstanding
voting securities of the Company entitled to vote generally in
the election of directors (the "Outstanding Company Voting
Securities"); provided, however, that for purposes of this
subsection (1), the following acquisitions shall not
constitute a Change of Control: (i) any acquisition by a
Person who is on the Effective Date the beneficial owner of
25% or more of the Outstanding Company Voting Securities, (ii)
any acquisition directly from the Company, (iii) any
acquisition by the Company, (iv) any acquisition by any
employee benefit plan (or related trust) sponsored or
maintained by the Company or any corporation controlled by the
Company, or (v) any acquisition by any corporation pursuant to
a transaction which complies with clauses (i), (ii) and (iii)
of subsection (3) of this definition; or
(2) Individuals who, as of the Effective Date,
constitute the Board (the "Incumbent Board") cease for any
reason to constitute at least a majority of the Board;
provided, however, that any individual becoming a director
subsequent to the Effective Date whose election, or nomination
for election by the Company's shareholders, was approved by a
vote of at least a majority of the directors then comprising
the Incumbent Board shall be considered as though such
individual were a member of the Incumbent Board, but
excluding, for this purpose, any such individual whose initial
assumption of office occurs as a result of an actual or
threatened election contest with respect to the election or
removal of directors or other actual or threatened
solicitation of proxies or consents by or on behalf of a
Person other than the Board; or
(3) Consummation of a reorganization, merger or
consolidation or sale or other disposition of all or
substantially all of the assets of the Company (a "Business
Combination"), in each case, unless, following such Business
Combination, (i) all or substantially all of the individuals
and entities who were the beneficial owners of the Outstanding
Company Voting Securities immediately prior to such Business
Combination beneficially own, directly or indirectly, more
than 50% of the combined voting power of the then outstanding
voting securities entitled to vote generally in the election
of directors of the corporation resulting from such Business
Combination (including, without limitation, a corporation
which as a result of such transaction owns the Company or all
or substantially all of the Company's assets either directly
or through one or more subsidiaries) in substantially the same
proportions as their ownership, immediately prior
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<PAGE> 3
to such Business Combination of the Outstanding Company Voting
Securities, and (ii) no Person (excluding any corporation
resulting from such Business Combination or any employee
benefit plan (or related trust) of the Company or such
corporation resulting from such Business Combination)
beneficially owns, directly or indirectly, 25% or more of the
combined voting power of the then outstanding voting
securities of such corporation except to the extent that such
ownership existed prior to the Business Combination, and (iii)
at least a majority of the members of the board of directors
of the corporation resulting from such Business Combination
were members of the Incumbent Board at the time of the
execution of the initial agreement, or of the action of the
Board, providing for such Business Combination; or
(4) Approval by the shareholders of the Company
of a complete liquidation or dissolution of the Company.
(e) "Code" means the Internal Revenue Code of 1986, as
amended from time to time.
(f) "Committee" means the committee of the Board
described in Article 4.
(g) "Company" means Satilla Financial Services, Inc., a
Georgia corporation.
(h) "Covered Employee" means a covered employee as
defined in Code Section 162(m)(3).
(i) "Disability" shall mean any illness or other physical
or mental condition of a Participant that renders the Participant
incapable of performing his customary and usual duties for the Company,
or any medically determinable illness or other physical or mental
condition resulting from a bodily injury, disease or mental disorder
which, in the judgment of the Committee, is permanent and continuous in
nature. The Committee may require such medical or other evidence as it
deems necessary to judge the nature and permanency of the Participant's
condition.
(j) "Dividend Equivalent" means a right granted to a
Participant under Article 11.
(k) "Effective Date" has the meaning assigned such term
in Section 2.1.
(l) "Fair Market Value," on any date, means (i) if the
Stock is listed on a securities exchange or is traded over the Nasdaq
National Market, the closing sales price on such exchange or over such
system on such date or, in the absence
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<PAGE> 4
of reported sales on such date, the closing sales price on the
immediately preceding date on which sales were reported, or (ii) if the
Stock is not listed on a securities exchange or traded over the Nasdaq
National Market, the mean between the bid and offered prices as quoted
by Nasdaq for such date, provided that if it is determined that the
fair market value is not properly reflected by such Nasdaq quotations,
Fair Market Value will be determined by such other method as the
Committee determines in good faith to be reasonable.
(m) "Incentive Stock Option" means an Option that is
intended to meet the requirements of Section 422 of the Code or any
successor provision thereto.
(n) "Non-Qualified Stock Option" means an Option that is
not an Incentive Stock Option.
(o) "Option" means a right granted to a Participant under
Article 7 of the Plan to purchase Stock at a specified price during
specified time periods. An Option may be either an Incentive Stock
Option or a Non-Qualified Stock Option.
(p) "Other Stock-Based Award" means a right, granted to a
Participant under Article 12, that relates to or is valued by reference
to Stock or other Awards relating to Stock.
(q) "Parent" means a corporation which owns or
beneficially owns a majority of the outstanding voting stock or voting
power of the Company. For Incentive Stock Options, the term shall have
the same meaning as set forth in Code Section 424(e).
(r) "Participant" means a person who, as an employee or
officer of the Company or any Subsidiary, has been granted an Award
under the Plan.
(s) "Performance Unit" means a right granted to a
Participant under Article 9, to receive cash, Stock, or other Awards,
the payment of which is contingent upon achieving certain performance
goals established by the Committee.
(t) "Plan" means the Satilla Financial Services, Inc.
1999 Long-Term Incentive Plan, as amended from time to time.
(u) "Restricted Stock Award" means Stock granted to a
Participant under Article 10 that is subject to certain restrictions
and to risk of forfeiture.
(v) "Stock" means the $.01 par value common stock of the
Company and such other securities of the Company as may be substituted
for Stock pursuant to Article 14.
-4-
<PAGE> 5
(w) "Stock Appreciation Right" or "SAR" means a right
granted to a Participant under Article 8 to receive a payment equal to
the difference between the Fair Market Value of a share of Stock as of
the date of exercise of the SAR over the grant price of the SAR, all as
determined pursuant to Article 8.
(x) "Subsidiary" means any corporation, limited liability
company, partnership or other entity of which a majority of the
outstanding voting stock or voting power is beneficially owned directly
or indirectly by the Company. For Incentive Stock Options, the term
shall have the meaning set forth in Code Section 424(f).
(y) "1933 Act" means the Securities Act of 1933, as
amended from time to time.
(z) "1934 Act" means the Securities Exchange Act of 1934,
as amended from time to time.
ARTICLE 4
ADMINISTRATION
4.1 COMMITTEE. The Plan shall be administered by the Compensation
Committee of the Board or, at the discretion of the Board from time to time, by
the Board. The Committee shall consist of two or more members of the Board. It
is intended that the directors appointed to serve on the Committee shall be
"non-employee directors" (within the meaning of Rule 16b-3 promulgated under the
1934 Act) and "outside directors" (within the meaning of Code Section 162(m) and
the regulations thereunder) to the extent that Rule 16b-3 and, if necessary for
relief from the limitation under Code Section 162(m) and such relief is sought
by the Company, Code Section 162(m), respectively, are applicable. However, the
mere fact that a Committee member shall fail to qualify under either of the
foregoing requirements shall not invalidate any Award made by the Committee
which Award is otherwise validly made under the Plan. The members of the
Committee shall be appointed by, and may be changed at any time and from time to
time in the discretion of, the Board. During any time that the Board is acting
as administrator of the Plan, it shall have all the powers of the Committee
hereunder, and any reference herein to the Committee (other than in this Section
4.1) shall include the Board.
4.2 ACTION BY THE COMMITTEE. For purposes of administering the
Plan, the following rules of procedure shall govern the Committee. A majority of
the Committee shall constitute a quorum. The acts of a majority of the members
present at any meeting at which a quorum is present, and acts approved
unanimously in writing by the members of the Committee in lieu of a meeting,
shall be deemed the acts of the Committee. Each member of the Committee is
entitled to, in good faith, rely or act upon any report or other information
furnished to that member by any officer or other employee of the Company or any
Parent or Subsidiary, the Company's independent certified public
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<PAGE> 6
accountants, or any executive compensation consultant or other professional
retained by the Company to assist in the administration of the Plan.
4.3 AUTHORITY OF COMMITTEE. The Committee has the exclusive power,
authority and discretion to:
(a) Designate Participants;
(b) Determine the type or types of Awards to be granted
to each Participant;
(c) Determine the number of Awards to be granted and the
number of shares of Stock to which an Award will relate;
(d) Determine the terms and conditions of any Award
granted under the Plan, including but not limited to, the exercise
price, grant price, or purchase price, any restrictions or limitations
on the Award, any schedule for lapse of forfeiture restrictions or
restrictions on the exercisability of an Award, and accelerations or
waivers thereof, based in each case on such considerations as the
Committee in its sole discretion determines;
(e) Accelerate the vesting or lapse of restrictions of
any outstanding Award, based in each case on such considerations as the
Committee in its sole discretion determines;
(f) Determine whether, to what extent, and under what
circumstances an Award may be settled in, or the exercise price of an
Award may be paid in, cash, Stock, other Awards, or other property, or
an Award may be canceled, forfeited, or surrendered;
(g) Prescribe the form of each Award Agreement, which
need not be identical for each Participant;
(h) Decide all other matters that must be determined in
connection with an Award;
(i) Establish, adopt or revise any rules and regulations
as it may deem necessary or advisable to administer the Plan;
(j) Make all other decisions and determinations that may
be required under the Plan or as the Committee deems necessary or
advisable to administer the Plan; and
(k) Amend the Plan or any Award Agreement as provided
herein.
-6-
<PAGE> 7
4.4. DECISIONS BINDING. The Committee's interpretation of the Plan,
any Awards granted under the Plan, any Award Agreement and all decisions and
determinations by the Committee with respect to the Plan are final, binding, and
conclusive on all parties.
ARTICLE 5
SHARES SUBJECT TO THE PLAN
5.1. NUMBER OF SHARES. Subject to adjustment as provided in Section
14.1, the aggregate number of shares of Stock reserved and available for Awards
or which may be used to provide a basis of measurement for or to determine the
value of an Award (such as with a Stock Appreciation Right or Performance Unit
Award) shall be 500,000, of which not more than 10% may be granted as Awards of
Restricted Stock or unrestricted Stock Awards.
5.2. LAPSED AWARDS. To the extent that an Award is canceled,
terminates, expires or lapses for any reason, any shares of Stock subject to the
Award will again be available for the grant of an Award under the Plan and
shares subject to SARs or other Awards settled in cash will be available for the
grant of an Award under the Plan.
5.3. STOCK DISTRIBUTED. Any Stock distributed pursuant to an Award
may consist, in whole or in part, of authorized and unissued Stock, treasury
Stock or Stock purchased on the open market.
5.4. LIMITATION ON AWARDS. Notwithstanding any provision in the
Plan to the contrary (but subject to adjustment as provided in Section 14.1),
the maximum number of shares of Stock with respect to one or more Options and/or
SARs that may be granted during any one calendar year under the Plan to any one
Participant shall be 25,000. The maximum fair market value (measured as of the
date of grant) of any Awards other than Options and SARs that may be received by
any one Participant (less any consideration paid by the Participant for such
Award) during any one calendar year under the Plan shall be $100,000.
ARTICLE 6
ELIGIBILITY
6.1. GENERAL. Awards may be granted only to individuals who are
employees, officers or directors of the Company or a Parent or Subsidiary.
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<PAGE> 8
ARTICLE 7
STOCK OPTIONS
7.1. GENERAL. The Committee is authorized to grant Options to
Participants on the following terms and conditions:
(a) EXERCISE PRICE. The exercise price per share of Stock
under an Option shall be determined by the Committee, provided that the
exercise price for any Option shall not be less than the Fair Market
Value as of the date of the grant.
(b) TIME AND CONDITIONS OF EXERCISE. The Committee shall
determine the time or times at which an Option may be exercised in
whole or in part. The Committee also shall determine the performance or
other conditions, if any, that must be satisfied before all or part of
an Option may be exercised. The Committee may waive any exercise
provisions at any time in whole or in part based upon factors as the
Committee may determine in its sole discretion so that the Option
becomes exercisable at an earlier date.
(c) PAYMENT. The Committee shall determine the methods by
which the exercise price of an Option may be paid, the form of payment,
including, without limitation, cash, shares of Stock, or other property
(including "cashless exercise" arrangements), and the methods by which
shares of Stock shall be delivered or deemed to be delivered to
Participants; provided that if shares of Stock surrendered in payment
of the exercise price were themselves acquired otherwise than on the
open market, such shares shall have been held by the Participant for at
least six months.
(d) EVIDENCE OF GRANT. All Options shall be evidenced by
a written Award Agreement between the Company and the Participant. The
Award Agreement shall include such provisions, not inconsistent with
the Plan, as may be specified by the Committee.
(e) ADDITIONAL OPTIONS UPON EXERCISE. The Committee may,
in its sole discretion, provide in an Award Agreement, or in an
amendment thereto, for the automatic grant of a new Option to any
Participant who delivers shares of Stock as full or partial payment of
the exercise price of the original Option. Any new Option granted in
such a case (i) shall be for the same number of shares of Stock as the
Participant delivered in exercising the original Option, (ii) shall
have an exercise price of 100% of the Fair Market Value of the
surrendered shares of Stock on the date of exercise of the original
Option (the grant date for the new Option), and (iii) shall have a term
equal to the unexpired term of the original Option.
-8-
<PAGE> 9
7.2. INCENTIVE STOCK OPTIONS. The terms of any Incentive Stock
Options granted under the Plan must comply with the following additional rules:
(a) EXERCISE PRICE. The exercise price per share of Stock
shall be set by the Committee, provided that the exercise price for any
Incentive Stock Option shall not be less than the Fair Market Value as
of the date of the grant.
(b) EXERCISE. In no event may any Incentive Stock Option
be exercisable for more than ten years from the date of its grant.
(c) LAPSE OF OPTION. An Incentive Stock Option shall
lapse under the earliest of the following circumstances; provided,
however, that the Committee may, prior to the lapse of the Incentive
Stock Option under the circumstances described in paragraphs (3), (4)
and (5) below, provide in writing that the Option will extend until a
later date, but if Option is exercised after the dates specified in
paragraphs (3), (4) and (5) below, it will automatically become a
Non-Qualified Stock Option:
(1) The Incentive Stock Option shall lapse as of
the option expiration date set forth in the Award Agreement.
(2) The Incentive Stock Option shall lapse ten
years after it is granted, unless an earlier time is set in
the Award Agreement.
(3) If the Participant terminates employment for
any reason other than as provided in paragraph (4) or (5)
below, the Incentive Stock Option shall lapse, unless it is
previously exercised, three months after the Participant's
termination of employment; provided, however, that if the
Participant's employment is terminated by the Company for
cause or by the Participant without the consent of the
Company, the Incentive Stock Option shall (to the extent not
previously exercised) lapse immediately.
(4) If the Participant terminates employment by
reason of his Disability, the Incentive Stock Option shall
lapse, unless it is previously exercised, one year after the
Participant's termination of employment.
(5) If the Participant dies while employed, or
during the three-month period described in paragraph (3) or
during the one-year period described in paragraph (4) and
before the Option otherwise lapses, the Option shall lapse one
year after the Participant's death. Upon the Participant's
death, any exercisable Incentive Stock Options may be
exercised by the Participant's beneficiary, determined in
accordance with Section 13.6.
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<PAGE> 10
Unless the exercisability of the Incentive Stock
Option is accelerated as provided in Article 13, if a
Participant exercises an Option after termination of
employment, the Option may be exercised only with respect to
the shares that were otherwise vested on the Participant's
termination of employment.
(d) INDIVIDUAL DOLLAR LIMITATION. The aggregate
Fair Market Value (determined as of the time an Award is made)
of all shares of Stock with respect to which Incentive Stock
Options are first exercisable by a Participant in any calendar
year may not exceed $100,000.00.
(e) TEN PERCENT OWNERS. No Incentive Stock
Option shall be granted to any individual who, at the date of
grant, owns stock possessing more than ten percent of the
total combined voting power of all classes of stock of the
Company or any Parent or Subsidiary unless the exercise price
per share of such Option is at least 110% of the Fair Market
Value per share of Stock at the date of grant and the Option
expires no later than five years after the date of grant.
(f) EXPIRATION OF INCENTIVE STOCK OPTIONS. No
Award of an Incentive Stock Option may be made pursuant to the
Plan after the day immediately prior to the tenth anniversary
of the Effective Date.
(g) RIGHT TO EXERCISE. During a Participant's
lifetime, an Incentive Stock Option may be exercised only by
the Participant or, in the case of the Participant's
Disability, by the Participant's guardian or legal
representative.
(h) DIRECTORS. The Committee may not grant an
Incentive Stock Option to a non-employee director. The
Committee may grant an Incentive Stock Option to a director
who is also an employee of the Company or Parent or Subsidiary
but only in that individual's position as an employee and not
as a director.
ARTICLE 8
STOCK APPRECIATION RIGHTS
8.1. GRANT OF SARs. The Committee is authorized to grant SARs to
Participants on the following terms and conditions:
(a) RIGHT TO PAYMENT. Upon the exercise of a Stock
Appreciation Right, the Participant to whom it is granted has the right
to receive the excess, if any, of:
(1) The Fair Market Value of one share of Stock
on the date of exercise; over
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<PAGE> 11
(2) The grant price of the Stock Appreciation
Right as determined by the Committee, which shall not be less
than the Fair Market Value of one share of Stock on the date
of grant.
(b) OTHER TERMS. All awards of Stock Appreciation Rights
shall be evidenced by an Award Agreement. The terms, methods of
exercise, methods of settlement, form of consideration payable in
settlement, and any other terms and conditions of any Stock
Appreciation Right shall be determined by the Committee at the time of
the grant of the Award and shall be reflected in the Award Agreement.
ARTICLE 9
PERFORMANCE UNITS
9.1. GRANT OF PERFORMANCE UNITS. The Committee is authorized to
grant Performance Units to Participants on such terms and conditions as may be
selected by the Committee. The Committee shall have the complete discretion to
determine the number of Performance Units granted to each Participant. All
Awards of Performance Units shall be evidenced by an Award Agreement.
9.2. RIGHT TO PAYMENT. A grant of Performance Units gives the
Participant rights, valued as determined by the Committee, and payable to, or
exercisable by, the Participant to whom the Performance Units are granted, in
whole or in part, as the Committee shall establish at grant or thereafter. The
Committee shall set performance goals and other terms or conditions to payment
of the Performance Units in its discretion which, depending on the extent to
which they are met, will determine the number and value of Performance Units
that will be paid to the Participant.
9.3. OTHER TERMS. Performance Units may be payable in cash, Stock,
or other property, and have such other terms and conditions as determined by the
Committee and reflected in the Award Agreement.
ARTICLE 10
RESTRICTED STOCK AWARDS
10.1. GRANT OF RESTRICTED STOCK. The Committee is authorized to make
Awards of Restricted Stock to Participants in such amounts and subject to such
terms and conditions as may be selected by the Committee. All Awards of
Restricted Stock shall be evidenced by a Restricted Stock Award Agreement.
10.2. ISSUANCE AND RESTRICTIONS. Restricted Stock shall be subject
to such restrictions on transferability and other restrictions as the Committee
may impose (including, without limitation, limitations on the right to vote
Restricted Stock or the right to receive dividends on the Restricted Stock).
These restrictions may lapse separately or in combination at such times, under
such circumstances, in such installments, upon the
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<PAGE> 12
satisfaction of performance goals or otherwise, as the Committee determines at
the time of the grant of the Award or thereafter.
10.3. FORFEITURE. Except as otherwise determined by the Committee at
the time of the grant of the Award or thereafter, upon termination of employment
during the applicable restriction period or upon failure to satisfy a
performance goal during the applicable restriction period, Restricted Stock that
is at that time subject to restrictions shall be forfeited and reacquired by the
Company; provided, however, that the Committee may provide in any Award
Agreement that restrictions or forfeiture conditions relating to Restricted
Stock will be waived in whole or in part in the event of terminations resulting
from specified causes, and the Committee may in other cases waive in whole or in
part restrictions or forfeiture conditions relating to Restricted Stock.
10.4. CERTIFICATES FOR RESTRICTED STOCK. Restricted Stock granted
under the Plan may be evidenced in such manner as the Committee shall determine.
If certificates representing shares of Restricted Stock are registered in the
name of the Participant, certificates must bear an appropriate legend referring
to the terms, conditions, and restrictions applicable to such Restricted Stock.
ARTICLE 11 DIVIDEND EQUIVALENTS
11.1 GRANT OF DIVIDEND EQUIVALENTS. The Committee is authorized to
grant Dividend Equivalents to Participants subject to such terms and conditions
as may be selected by the Committee. Dividend Equivalents shall entitle the
Participant to receive payments equal to dividends with respect to all or a
portion of the number of shares of Stock subject to an Award, as determined by
the Committee. The Committee may provide that Dividend Equivalents be paid or
distributed when accrued or be deemed to have been reinvested in additional
shares of Stock, or otherwise reinvested.
ARTICLE 12
OTHER STOCK-BASED AWARDS
12.1. GRANT OF OTHER STOCK-BASED AWARDS. The Committee is
authorized, subject to limitations under applicable law, to grant to
Participants such other Awards that are payable in, valued in whole or in part
by reference to, or otherwise based on or related to shares of Stock, as deemed
by the Committee to be consistent with the purposes of the Plan, including
without limitation shares of Stock awarded purely as a "bonus" and not subject
to any restrictions or conditions, convertible or exchangeable debt securities,
other rights convertible or exchangeable into shares of Stock, and Awards valued
by reference to book value of shares of Stock or the value of securities of or
the performance of specified Parents or Subsidiaries. The Committee shall
determine the terms and conditions of such Awards.
-12-
<PAGE> 13
ARTICLE 13
PROVISIONS APPLICABLE TO AWARDS
13.1. STAND-ALONE, TANDEM, AND SUBSTITUTE AWARDS. Awards granted
under the Plan may, in the discretion of the Committee, be granted either alone
or in addition to, in tandem with, or in substitution for, any other Award
granted under the Plan. If an Award is granted in substitution for another
Award, the Committee may require the surrender of such other Award in
consideration of the grant of the new Award. Awards granted in addition to or in
tandem with other Awards may be granted either at the same time as or at a
different time from the grant of such other Awards.
13.2. EXCHANGE PROVISIONS. The Committee may at any time offer to
exchange or buy out any previously granted Award for a payment in cash, Stock,
or another Award (subject to Section 14.1), based on the terms and conditions
the Committee determines and communicates to the Participant at the time the
offer is made, and after taking into account the tax, securities and accounting
effects of such an exchange.
13.3. TERM OF AWARD. The term of each Award shall be for the period
as determined by the Committee, provided that in no event shall the term of any
Incentive Stock Option or a Stock Appreciation Right granted in tandem with the
Incentive Stock Option exceed a period of ten years from the date of its grant
(or, if Section 7.2(e) applies, five years from the date of its grant).
13.4. FORM OF PAYMENT FOR AWARDS. Subject to the terms of the Plan
and any applicable law or Award Agreement, payments or transfers to be made by
the Company or a Parent or Subsidiary on the grant or exercise of an Award may
be made in such form as the Committee determines at or after the time of grant,
including without limitation, cash, Stock, other Awards, or other property, or
any combination, and may be made in a single payment or transfer, in
installments, or on a deferred basis, in each case determined in accordance with
rules adopted by, and at the discretion of, the Committee.
13.5. LIMITS ON TRANSFER. No right or interest of a Participant in
any unexercised or restricted Award may be pledged, encumbered, or hypothecated
to or in favor of any party other than the Company or a Parent or Subsidiary, or
shall be subject to any lien, obligation, or liability of such Participant to
any other party other than the Company or a Parent or Subsidiary. No unexercised
or restricted Award shall be assignable or transferable by a Participant other
than by will or the laws of descent and distribution or, except in the case of
an Incentive Stock Option, pursuant to a domestic relations order that would
satisfy Section 414(p)(1)(A) of the Code if such Section applied to an Award
under the Plan; provided, however, that the Committee may (but need not) permit
other transfers where the Committee concludes that such transferability (i) does
not result in accelerated taxation, (ii) does not cause any Option intended to
be an Incentive Stock Option to fail to be described in Code Section 422(b), and
(iii) is otherwise appropriate and desirable, taking into account any factors
deemed relevant, including
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<PAGE> 14
without limitation, any state or federal tax or securities laws or regulations
applicable to transferable Awards.
13.6 BENEFICIARIES. Notwithstanding Section 13.5, a Participant
may, in the manner determined by the Committee, designate a beneficiary to
exercise the rights of the Participant and to receive any distribution with
respect to any Award upon the Participant's death. A beneficiary, legal
guardian, legal representative, or other person claiming any rights under the
Plan is subject to all terms and conditions of the Plan and any Award Agreement
applicable to the Participant, except to the extent the Plan and Award Agreement
otherwise provide, and to any additional restrictions deemed necessary or
appropriate by the Committee. If no beneficiary has been designated or survives
the Participant, payment shall be made to the Participant's estate. Subject to
the foregoing, a beneficiary designation may be changed or revoked by a
Participant at any time provided the change or revocation is filed with the
Committee.
13.7. STOCK CERTIFICATES. All Stock certificates delivered under the
Plan are subject to any stop-transfer orders and other restrictions as the
Committee deems necessary or advisable to comply with federal or state
securities laws, rules and regulations and the rules of any national securities
exchange or automated quotation system on which the Stock is listed, quoted, or
traded. The Committee may place legends on any Stock certificate to reference
restrictions applicable to the Stock.
13.8. ACCELERATION UPON A CHANGE IN CONTROL. Except as otherwise
provided in the Award Agreement, upon the occurrence of a Change in Control, all
outstanding Options, Stock Appreciation Rights, and other Awards in the nature
of rights that may be exercised shall become fully exercisable and all
restrictions on outstanding Awards shall lapse; provided, however that such
acceleration will not occur if, in the opinion of the Company's accountants,
such acceleration would preclude the use of "pooling of interest" accounting
treatment for a Change in Control transaction that (a) would otherwise qualify
for such accounting treatment, and (b) is contingent upon qualifying for such
accounting treatment. To the extent that this provision causes Incentive Stock
Options to exceed the dollar limitation set forth in Section 7.2(d), the excess
Options shall be deemed to be Non-Qualified Stock Options.
13.9. ACCELERATION UPON CERTAIN EVENTS NOT CONSTITUTING A CHANGE IN
CONTROL. In the event of the occurrence of any circumstance, transaction or
event not constituting a Change in Control (as defined in Section 3.1) but which
the Board of Directors deems to be, or to be reasonably likely to lead to, an
effective change in control of the Company of a nature that would be required to
be reported in response to Item 6(e) of Schedule 14A of the 1934 Act, the
Committee may in its sole discretion declare all outstanding Options, Stock
Appreciation Rights, and other Awards in the nature of rights that may be
exercised to be fully exercisable, and/or all restrictions on all outstanding
Awards to have lapsed, in each case, as of such date as the Committee may, in
its sole discretion, declare, which may be on or before the consummation of such
transaction or event. To the extent that this provision causes
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<PAGE> 15
Incentive Stock Options to exceed the dollar limitation set forth in Section
7.2(d), the excess Options shall be deemed to be Non-Qualified Stock Options.
13.10. ACCELERATION FOR ANY OTHER REASON. Regardless of whether an
event has occurred as described in Section 13.8 or 13.9 above, the Committee may
in its sole discretion at any time determine that all or a portion of a
Participant's Options, Stock Appreciation Rights, and other Awards in the nature
of rights that may be exercised shall become fully or partially exercisable,
and/or that all or a part of the restrictions on all or a portion of the
outstanding Awards shall lapse, in each case, as of such date as the Committee
may, in its sole discretion, declare. The Committee may discriminate among
Participants and among Awards granted to a Participant in exercising its
discretion pursuant to this Section 13.10.
13.11 EFFECT OF ACCELERATION. If an Award is accelerated under
Section 13.8 or 13.9, the Committee may, in its sole discretion, provide (i)
that the Award will expire after a designated period of time after such
acceleration to the extent not then exercised, (ii) that the Award will be
settled in cash rather than Stock, (iii) that the Award will be assumed by
another party to the transaction giving rise to the acceleration or otherwise be
equitably converted in connection with such transaction, or (iv) any combination
of the foregoing. The Committee's determination need not be uniform and may be
different for different Participants, whether or not such Participants are
similarly situated.
13.12. PERFORMANCE GOALS. The Committee may determine that any Award
granted pursuant to this Plan to a Participant (including, but not limited to,
Participants who are Covered Employees) shall be determined solely on the basis
of (a) the achievement by the Company or a Parent or Subsidiary of a specified
target return, or target growth in return, on equity or assets, (b) the
Company's, Parent's or Subsidiary's stock price, (c) the achievement by an
individual or a business unit of the Company, Parent or Subsidiary of a
specified target, or target growth in, revenues, net income or earnings per
share, (d) the achievement of objectively determinable goals with respect to
service or product delivery, service or product quality, customer satisfaction,
meeting budgets and/or retention of employees, or (e) any combination of the
goals set forth in (a) through (d) above. If an Award is made on such basis, the
Committee shall establish goals prior to the beginning of the period for which
such performance goal relates (or such later date as may be permitted under Code
Section 162(m) or the regulations thereunder) and the Committee may for any
reason reduce (but not increase) any Award, notwithstanding the achievement of a
specified goal. Any payment of an Award granted with performance goals shall be
conditioned on the written certification of the Committee in each case that the
performance goals and any other material conditions were satisfied.
13.13. TERMINATION OF EMPLOYMENT. Whether military, government or
other service or other leave of absence shall constitute a termination of
employment shall be determined in each case by the Committee at its discretion,
and any determination by the Committee shall be final and conclusive. A
termination of employment shall not occur
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<PAGE> 16
in a circumstance in which a Participant transfers from the Company to one of
its Parents or Subsidiaries, transfers from a Parent or Subsidiary to the
Company, or transfers from one Parent or Subsidiary to another Parent or
Subsidiary.
ARTICLE 14
CHANGES IN CAPITAL STRUCTURE
14.1. GENERAL. In the event a stock dividend is declared upon the
Stock, the authorization limits under Section 5.1 and 5.4 shall be increased
proportionately, and the shares of Stock then subject to each Award shall be
increased proportionately without any change in the aggregate purchase price
therefor. In the event the Stock shall be changed into or exchanged for a
different number or class of shares of stock or securities of the Company or of
another corporation, whether through reorganization, recapitalization,
reclassification, share exchange, stock split-up, combination of shares, merger
or consolidation, the authorization limits under Section 5.1 and 5.4 shall be
adjusted proportionately, and there shall be substituted for each such share of
Stock then subject to each Award the number and class of shares into which each
outstanding share of Stock shall be so exchanged, all without any change in the
aggregate purchase price for the shares then subject to each Award, or, subject
to Section 15.2, there shall be made such other equitable adjustment as the
Committee shall approve.
ARTICLE 15
AMENDMENT, MODIFICATION AND TERMINATION
15.1. AMENDMENT, MODIFICATION AND TERMINATION. The Board or the
Committee may, at any time and from time to time, amend, modify or terminate the
Plan without shareholder approval; provided, however, that the Board or
Committee may condition any amendment or modification on the approval of
shareholders of the Company if such approval is necessary or deemed advisable
with respect to tax, securities or other applicable laws, policies or
regulations.
15.2 AWARDS PREVIOUSLY GRANTED. At any time and from time to time,
the Committee may amend, modify or terminate any outstanding Award without
approval of the Participant; provided, however, that, subject to the terms of
the applicable Award Agreement, such amendment, modification or termination
shall not, without the Participant's consent, reduce or diminish the value of
such Award determined as if the Award had been exercised, vested, cashed in or
otherwise settled on the date of such amendment or termination, and provided
further that, except as otherwise permitted in the Plan, the exercise price of
any Option may not be reduced and the original term of any Option may not be
extended. No termination, amendment, or modification of the Plan shall adversely
affect any Award previously granted under the Plan, without the written consent
of the Participant.
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<PAGE> 17
ARTICLE 16
GENERAL PROVISIONS
16.1. NO RIGHTS TO AWARDS. No Participant or eligible participant
shall have any claim to be granted any Award under the Plan, and neither the
Company nor the Committee is obligated to treat Participants or eligible
participants uniformly.
16.2. NO SHAREHOLDER RIGHTS. No Award gives the Participant any of
the rights of a shareholder of the Company unless and until shares of Stock are
in fact issued to such person in connection with such Award.
16.3. WITHHOLDING. The Company or any Parent or Subsidiary shall
have the authority and the right to deduct or withhold, or require a Participant
to remit to the Company, an amount sufficient to satisfy federal, state, and
local taxes (including the Participant's FICA obligation) required by law to be
withheld with respect to any taxable event arising as a result of the Plan. With
respect to withholding required upon any taxable event under the Plan, the
Committee may, at the time the Award is granted or thereafter, require that any
such withholding requirement be satisfied, in whole or in part, by withholding
shares of Stock having a Fair Market Value on the date of withholding equal to
the amount required to be withheld for tax purposes, all in accordance with such
procedures as the Committee establishes.
16.4. NO RIGHT TO CONTINUED SERVICE. Nothing in the Plan or any
Award Agreement shall interfere with or limit in any way the right of the
Company or any Parent or Subsidiary to terminate any Participant's employment or
status as an officer or director at any time, nor confer upon any Participant
any right to continue as an employee, officer or director of the Company or any
Parent or Subsidiary.
l6.5. UNFUNDED STATUS OF AWARDS. The Plan is intended to be an
"unfunded" plan for incentive and deferred compensation. With respect to any
payments not yet made to a Participant pursuant to an Award, nothing contained
in the Plan or any Award Agreement shall give the Participant any rights that
are greater than those of a general creditor of the Company or any Parent or
Subsidiary.
16.6. INDEMNIFICATION. To the extent allowable under applicable law,
each member of the Committee shall be indemnified and held harmless by the
Company from any loss, cost, liability, or expense that may be imposed upon or
reasonably incurred by such member in connection with or resulting from any
claim, action, suit, or proceeding to which such member may be a party or in
which he may be involved by reason of any action or failure to act under the
Plan and against and from any and all amounts paid by such member in
satisfaction of judgment in such action, suit, or proceeding against him
provided he gives the Company an opportunity, at its own expense, to handle and
defend the same before he undertakes to handle and defend it on his own behalf.
The foregoing right of indemnification shall not be exclusive of any other
rights of indemnification to which such persons may be entitled under the
Company's Certificate of Incorporation or
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<PAGE> 18
Bylaws, as a matter of law, or otherwise, or any power that the Company may have
to indemnify them or hold them harmless.
16.7. RELATIONSHIP TO OTHER BENEFITS. No payment under the Plan
shall be taken into account in determining any benefits under any pension,
retirement, savings, profit sharing, group insurance, welfare or benefit plan of
the Company or any Parent or Subsidiary unless provided otherwise in such other
plan.
16.8. EXPENSES. The expenses of administering the Plan shall be
borne by the Company and its Parents or Subsidiaries.
16.9. TITLES AND HEADINGS. The titles and headings of the Sections
in the Plan are for convenience of reference only, and in the event of any
conflict, the text of the Plan, rather than such titles or headings, shall
control.
16.10. GENDER AND NUMBER. Except where otherwise indicated by the
context, any masculine term used herein also shall include the feminine, the
plural shall include the singular, and the singular shall include the plural.
16.11. FRACTIONAL SHARES. No fractional shares of Stock shall be
issued, and the Committee shall determine, in its discretion, whether cash shall
be given in lieu of fractional shares or whether such fractional shares shall be
eliminated by rounding up.
16.12. GOVERNMENT AND OTHER REGULATIONS. The obligation of the
Company to make payment of Awards in Stock or otherwise shall be subject to all
applicable laws, rules, and regulations, and to such approvals by government
agencies as may be required. The Company shall be under no obligation to
register under the 1933 Act, or any state securities act, any of the shares of
Stock paid under the Plan. The shares paid under the Plan may in certain
circumstances be exempt from registration under the 1933 Act, and the Company
may restrict the transfer of such shares in such manner as it deems advisable to
ensure the availability of any such exemption.
16.13. GOVERNING LAW. To the extent not governed by federal law, the
Plan and all Award Agreements shall be construed in accordance with and governed
by the laws of the State of Georgia.
16.14 ADDITIONAL PROVISIONS. Each Award Agreement may contain such
other terms and conditions as the Committee may determine; provided that such
other terms and conditions are not inconsistent with the provisions of this
Plan.
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<PAGE> 19
The foregoing is hereby acknowledged as being the Satilla Financial
Services, Inc. 1999 Long-Term Incentive Plan as adopted by the Board of
Directors of the Company on March 9, 1999 and approved by the Company's
shareholders on March 9, 1999.
SATILLA FINANCIAL SERVICES, Inc.
By: /s/ Rodney E. Bennett
---------------------------------
Name: Rodney E. Bennett
Title: President and
Chief Executive Officer
By: /s/ David L. Knox, Sr.
---------------------------------
Name: David L. Knox, Sr.
Title: Chairman
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<PAGE> 1
EXHIBIT 10.2
PROMISSORY NOTE
<TABLE>
PRINCIPAL LOAN DATE MATURITY LOAN NO CALL COLLATERAL ACCOUNT OFFICER INITIALS
$350,000,000 09-30-1998 09-30-1999 JKG
- ------------ ----------- ---------- -------- ---- ---------- -------- ------- --------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
References in the shaded area are for Lender's use only and do not limit applicability of this document to any particular loan or
item.
</TABLE>
<TABLE>
<S> <C> <C> <C>
Borrower: Satilla Community Bank Group Lender: THE BANKERS BANK
P.O. BOX 911 2410 PACES FERRY ROAD
Brunswick, GA 31521 600 PACES SUMMIT
ATLANTA, GA 30339
==================================================================================================================================
</TABLE>
<TABLE>
<S> <C> <C>
Principal Amount: $350,000,000 Initial Rate: 8.500% Date of Note: September 30, 1998
</TABLE>
PROMISE TO PAY. Satilla Community Bank Group ("Borrower") promises to pay to
THE BANKERS BANK ("Lender"), or order, in lawful money of the United States of
America, the principal amount of Three Hundred Fifty Thousand & 00/100 Dollars
($350,000.00) or so much as may be outstanding, together with interest on the
unpaid outstanding principal balance of each advance. Interest shall be
calculated from the date of each advance until repayment of each advance.
PAYMENT. Borrower will pay this loan in one payment of all outstanding
principal plus all accrued unpaid interest on September 30, 1999. Borrower will
pay Lender at Lender's address shown above or at such other place as Lender may
designate in writing. Unless otherwise agreed or required by applicable law,
payments will be applied first to accrued unpaid interest, then to principal,
and any remaining amount to any unpaid collection costs and late charges.
VARIABLE INTEREST RATE. The interest rate on this Note is subject to change
from time to time based on changes in an index which is the Prime rate as
published in the Money Rates section of the Wall Street Journal (the "Index").
If two or more rates exist, then the highest rate will prevail. Lender will
tell Borrower the current Index rate upon Borrower's request. Borrower
understands that Lender may make loans based on other rates as well. The
interest rate change will not occur more often than each day. The Index
currently is 8.500% per annum. The interest rate to be applied to the unpaid
principal balance of this Note will be at a rate equal to the Index, resulting
in an initial annual rate of simple interest of 8.500%. NOTICE: Under no
circumstances will the interest rate on this Note be more than the maximum rate
allowed by applicable law.
PREPAYMENT. Borrower may pay without penalty all or a portion of the amount
owed earlier than it is due.
LATE CHARGE. If a payment is 15 days or more late, Borrower will be charged
$100.00.
DEFAULT. Borrower will be in default if any of the following happens: (a)
Borrower fails to make any payment when due. (b) Borrower breaks any promise
Borrower has made to Lender, or Borrower fails to comply with or to perform when
due any other term, obligation, covenant, or condition contained in this Note or
any agreement related to this Note, or in any other agreement or loan Borrower
has with Lender. (c) Borrower defaults under any loan, extension of credit,
security agreement, purchase or sales agreement, or any other agreement in favor
of any other creditor or person that may materially affect any of Borrower's
property or Borrower's ability to repay this Note or perform Borrower's
obligations under this Note or any of the Related Documents. (d) Any
representation or statement made or furnished to Lender by Borrower or on
Borrower's behalf is false or misleading in any material respect either now or
at the time made or furnished. (e) Borrower becomes insolvent, a receiver is
appointed for any part of Borrower's property, Borrower makes an assignment for
the benefit of creditors, or any proceeding is commenced either by Borrower or
against Borrower under any bankruptcy or insolvency laws. (f) Any creditor tries
to take any of Borrower's property on or in which Lender has a lien or security
interest. This includes a garnishment of any of Borrower's accounts with Lender.
(g) Any guarantor dies or any of the other events described in this default
section occurs with respect to any guarantor of this Note. (h) A material
adverse change occurs in Borrower's financial condition, or Lender believes the
prospect of payment or performance of the indebtedness is impaired. (i) Lender
in good faith deems itself insecure.
LENDER'S RIGHTS. Upon default, Lender may declare the entire unpaid principal
balance on this Note and all accrued unpaid interest immediately due, without
notice, and then Borrower will pay that amount. Upon default, including failure
to pay upon final maturity, Lender, at its option, may also, if permitted under
applicable law, increase the variable interest rate on the Note to 3.000
percentage points over the Index. The interest rate will not exceed the maximum
rate permitted by applicable law. Lender may hire or pay someone else to help
collect this Note if Borrower does not pay. Borrower also will pay Lender that
amount. This includes, subject to any limits under applicable law, Lender's
costs of collection, including court costs and fifteen percent (15%) of the
principal plus accrued interest as attorneys' fees. If any sums owning under
this Note are collected by or through an attorney-at-law, whether or not there
is a lawsuit, and legal expenses for bankruptcy proceedings (including efforts
to modify or vacate any automatic stay or injunction), appeals, and any
anticipated post-judgment collection services. If not prohibited by applicable
law. Borrower also will pay any court cost, in addition to all other sums
provided by law. This Note has been delivered to Lender and accepted by Lender
in the State of Georgia. Subject to the provisions on arbitration, this Note
shall be governed by and construed in accordance with the laws of the State of
Georgia.
DISHONORED ITEM FEE. Borrower will pay a fee to Lender of twenty dollars
($20.00) or five percent (5%) of the face amount of the check, whichever is
greater, if Borrower makes a payment on Borrower's loan and the check or
preauthorized charge with which Borrower pays is later dishonored.
RIGHT OF SETOFF. Borrower grants to Lender a contractual possessory security
interest in, and hereby assigns, conveys, delivers, pledges, and transfers to
Lender all Borrower's right, title and interest in and to. Borrower's accounts
with Lender (whether checking, savings, or some other account), including
without limitation all accounts held jointly with someone else and all accounts
Borrower may open in the future, excluding however all IRA and Keogh accounts,
and all trust accounts for which the grant of a security interest would be
prohibited by law. Borrower authorizes Lender, to the extent permitted by
applicable law, to charge or setoff all sums owing on this Note against any and
all such accounts.
LINE OF CREDIT. This Note evidences a straight line of credit. Once the total
amount of principal has been advanced, Borrower is not entitled to further loan
advances. Advances under this Note, as well as directions for payment from
Borrower's accounts, may be requested orally or in writing by Borrower or by an
authorized person. Lender may, but need not, require that all oral requests be
confirmed in writing. The following party or parties are authorized to request
advances under the line of credit until Lender receives from Borrower at
Lender's address shown above written notice of revocation of their authority:
Rodney E. Bennett, President; and David L. Knox. Borrower agrees to be liable
for all sums either: (a) advanced in accordance with the instructions of an
authorized person or (b) credited to any of Borrower's accounts with Lender.
The unpaid principal balance owing on this Note at any time may be evidenced by
endorsements on this Note or by Lender's internal records, including daily
computer print-outs. Lender will have no obligation to advance funds under this
Note if: (a) Borrower or any guarantor is in default under the terms of this
Note or any agreement that Borrower or any guarantor has with lender, including
any agreement made in connection with the signing of this Note; (b) Borrower or
any guarantor ceases doing business or is insolvent; (c) any guarantor seeks,
claims or otherwise attempts to limit, modify or revoke such guarantor's
guarantee of this Note or any other loan with Lender; (d) Borrower has applied
funds provided pursuant to this Note for purposes other than those authorized
by Lender; or (e) Lender in good faith deems itself insecure under this Note or
any other agreement between Lender and Borrower.
ARBITRATION. Lender and Borrower agree that all disputes, claims and
controversies between them, whether individual, joint, or class in nature
arising from this Note or otherwise, including without limitation contract and
tort disputes, shall be arbitrated pursuant to the Rules of the American
Arbitration Association, upon request of either party. No act to take or dispose
of any collateral securing this Note shall constitute a waiver of this
arbitration agreement or be prohibited by this arbitration agreement. This
includes, without limitation, obtaining injunctive relief or a temporary
restraining order; invoking a power of sale under any deed of trust or mortgage;
obtaining a writ of attachment or imposition of a receiver; or exercising any
rights relating to personal property, including taking or disposing of such
property with or without judicial process pursuant to Article 9 of the Uniform
Commercial Code. Any disputes, claims, or controversies concerning the
lawfulness or reasonableness of any act, or exercise of any right, concerning
any collateral securing this Note, including any claim to rescind, reform, or
otherwise modify any agreement relating to the collateral securing this Note,
shall also be arbitrated, provided, however that no arbitrator shall have the
right or the power to enjoin or restrain any act of any party. Judgment upon
any award rendered by any arbitrator may be entered in any court having
jurisdiction. Nothing in this Note shall preclude any party from seeking
equitable relief from a court of competent jurisdiction. The statute of
limitations, estoppel, waiver, laches, and similar doctrines which would
otherwise be applicable in an action brought by a party shall be applicable in
any arbitration proceeding, and the commencement of an arbitration proceeding
shall be deemed the commencement of an action for these purposes. The Federal
Arbitration Act shall apply to the construction, interpretation, and enforcement
of this arbitration provision.
ACCRUAL METHOD. Interest will be calculated on an Actual/360 basis.
GENERAL PROVISIONS. Lender may delay or forgo enforcing any of its rights or
remedies under this Note without losing them. Borrower and any other person who
signs, guarantees or endorses this Note, to the extent allowed by law, waive
presentment, demand for payment, protest and notice of dishonor. Upon any
change in the terms of this Note, and unless otherwise expressly stated in
writing, no party who signs this Note, whether as maker, guarantor,
accommodation maker or endorser, shall be released from liability. All such
parties waive any right to require Lender to take action against any other
party who signs this Note as provided in O.C.G.A. Section 10-7-24 and agree
that Lender may renew or extend (repeatedly and for any length of time) this
loan, or release any party or guarantor or collateral; or impair, fail to
realize upon or perfect Lender's security interest in the collateral; and take
any other action deemed necessary by Lender without the consent of or notice to
anyone. All such parties also agree that Lender may modify this Loan without
the consent of or notice to anyone other than the party with whom the
modification is made.
<PAGE> 2
09-30-1998 PROMISSORY NOTE Page 2
Loan No (Continued)
================================================================================
IN WITNESS WHEREOF, THIS NOTE HAS BEEN SIGNED AND SEALED BY THE UNDERSIGNED, WHO
ACKNOWLEDGES A COMPLETED COPY HEREOF.
BORROWER:
Satilla Community Bank Group
By: /S/ RODNEY E. BENNET (SEAL) By: /S/ DAVID L. KNOX (SEAL)
----------------------------- --------------------------
Rodney E. Bennett, President David L. Knox, Chairman
LENDER:
THE BANKERS BANK
By: /S/
--------------------------------
Authorized Officer
================================================================================
Variable Rate. Line of Credit.
<PAGE> 3
GUARANTY
The Bankers Bank September 30, 1998
Atlanta, GA
- - FOR VALUE RECEIVED, the sufficiency of which is hereby acknowledged, and in
consideration of any loan or other financial accommodation heretofore or
hereafter at any time made or granted to SATILLA COMMUNITY BANK GROUP
(hereinafter called the "Debtor") by THE BANKERS BANK (hereinafter together
with its successors and assigns, called the "Bank"), the undersigned hereby
unconditionally guarantee(s) the full and prompt payment when due, whether
by declaration or otherwise, and at all times hereafter, of all obligations
of the Debtor to the Bank, however and whenever incurred or evidenced,
whether direct or indirect, absolute or contingent, due or to become due
(collectively called "Liabilities"), and the undersigned further agree(s) to
pay all expenses (including attorney's fees) paid or incurred by the Bank in
endeavoring to collect the Liabilities, or any part thereof, and in enforcing
this guaranty. The right of recover against each of the undersigned is,
however, limited to the amount of FORTY THOUSAND THREE HUNDRED EIGHTY FIVE
AND NO/100 DOLLARS ($40,385.00), plus interest on such amount and plus all
expenses of enforcing this guaranty.
- - Undersigned hereby transfers and conveys to the Bank any and all balances,
credits, deposits, accounts, items and monies of the undersigned now or
hereafter with the Bank, and the Bank is hereby given a lien upon security
title to and a security interest in all property of the undersigned of every
kind and description now or hereafter in the possession or control of the
Bank for any reason, including all dividends and distributions on or other
rights in connection therewith.
- - In the event of the death, incompetency, dissolution, or insolvency (as
defined by the Uniform Commercial Code as in effect at that time in Georgia)
of the Debtor, or if a petition in bankruptcy be filed by or against the
Debtor, or if a receiver be appointed for any part of the property or assets
of the Debtor, or if any judgement be entered against the Debtor, or if the
Bank shall feel insecure with respect to Liabilities and if any such event
should occur at a time when any of the Liabilities may not then be due and
payable, the undersigned agrees to pay to the Bank upon demand the full
amount which would be payable hereunder by the undersigned if all Liabilities
were then due and payable.
- - Bank may, without demand or notice of any kind, at any time when any amount
shall be due and payable hereunder by any of the undersigned, appropriate
and apply toward the payment of such amount, and in such order of
application as the Bank may from time to time elect, any property, balances,
credits, deposits, accounts, items or monies of such undersigned in the
possession or control of the Bank for any purpose.
- - This guaranty shall be continuing absolute and unconditional and shall
remain in full force and effect as to the undersigned, subject to
discontinuance of this guaranty as to any of the undersigned (including,
without limitation, any undersigned who shall become deceased, incompetent
or dissolved) only as follows: Any of the undersigned, and any person duly
authorized and acting on behalf of any of the undersigned, may give written
notice to the Bank of discontinuance of this guaranty as to the undersigned
by whom or on whose behalf such notice is given, but no such notice shall be
effective in any respect until it is actually received by the Bank and no
such notice shall affect or impair the obligations hereunder of the
undersigned by whom or on whose behalf such notice is given with respect to
any Liabilities existing at the date of receipt of such notice by the Bank,
any interest thereon or any expenses paid or incurred by the Bank in
endeavoring to collect such Liabilities, or any part thereof, in enforcing
this guaranty against such undersigned. Any such notice of discontinuance by
or on behalf of any of the undersigned shall not affect or impair the
obligations hereunder of any other of the undersigned.
- - The Bank may, from time to time, without notice to the undersigned (or any
of them), (a) retain or obtain a security interest in any property to secure
any of the Liabilities or any obligation hereunder, (b) retain or obtain the
primary or secondary liability of any party or parties, in addition to the
undersigned, with respect to any of the Liabilities, (c) extend or renew
for any period (whether or not longer than the original period), alter or
exchange any of the Liabilities, (d) release or compromise any liability of
any of the undersigned hereunder or any liability of any other party or
parties primarily or secondarily liable on any of the Liabilities, (e)
release its security interest, if any, in all or any property securing any of
the Liabilities or any obligation hereunder and permit any substitution or
exchange for any such property, and (f) resort to the undersigned (or any of
them) for payment of any of the Liabilities, whether or not the Bank shall
have resorted to any property securing any of the Liabilities or any
obligation hereunder or shall have proceeded against any other of the
undersigned or any other party primarily or secondarily liable on any of the
Liabilities.
- - Any amount received by the Bank from whatever source and applied by it
toward the payment of the Liabilities shall be applied in such order of
application as the Bank may from time to time elect.
- - The undersigned hereby expressly waive(s): (a) Notice of the acceptance of
this guaranty, (b) notice of the existence or creation of all or any of the
Liabilities, (c) presentment, demand, notice of dishonor, protest, and all
other notices whatsoever, and (d) all diligence in collection or protection
of or realization upon the Liabilities or any part thereof, any obligation
hereunder, or any security for any of the foregoing.
- - The creation or existence from time to time of Liabilities in excess of the
amount to which the right of recovery under this guaranty is limited is
hereby authorized, without notice to the undersigned (or any of them), and
shall in no way effect or impair this guaranty.
- - The Bank may, without notice of any kind, sell, assign, or transfer all or
any of the Liabilities, and in such event each and every immediate and
successive assignee, transferee, or holder of all or any of the Liabilities,
shall have the right to enforce this guaranty, by suit or otherwise, for the
benefit of such assignee, transferee, or holder, as fully as if such
assignee, transferee, or holder were herein by name specifically given such
rights, powers and benefits, but the Bank shall have an unimpaired right,
prior and superior to that of any such assignee, transferee or holder, to
enforce this guaranty for the benefit of the Bank, as to so much of the
Liabilities as it has not sold, assigned, or transferred.
- - No delay or failure on the part of the Bank in the exercise of any right
or remedy shall operate as a waiver thereof, and no single or partial
exercise by the Bank of any right or remedy shall preclude other or further
exercise thereof or the exercise of any other right or remedy. No action of
the Bank permitted hereunder shall in any way impair or affect this guaranty.
For the purpose of this guaranty, Liabilities shall include all obligations
of the Debtor to the Bank, notwithstanding any right or power of the Debtor
or anyone else to assert any claim or defense, as to the invalidity or
unenforceability of any such obligation, and no such claim or defense shall
impair or affect the obligations of the undersigned hereunder.
- - This guaranty shall be binding upon the undersigned, and upon the heirs,
legal representatives, successors, and assigns of the undersigned. If more
than one party shall execute this guaranty, the term "undersigned" shall
mean all parties executing this guaranty, and all such parties shall be
jointly and severally obligated hereunder.
- - This guaranty has been made and delivered in the State of Georgia, and shall
be governed by the laws of that State. Wherever possible each provision of
this guaranty shall be interpreted in such manner as to be effective and
valid under applicable law, but if any provision of this guaranty shall be
prohibited by or invalid under such law, such provision shall be ineffective
to the extent of such prohibition or invalidity, without invalidating the
remainder of such provision or the remaining provisions of this guaranty.
<PAGE> 4
GUARANTY (CONTINUED)
IN WITNESS WHEREOF the undersigned have hereunto set their hands and affixed
their seals the day and year above written.
<TABLE>
<CAPTION>
Satilla Community Bank Group DATE: September 30, 1998
Signed, sealed and delivered in the presence of: Guarantor(s):
<S> <C>
/s/ Kristina Allen /s/ Robert T. Baird
- -------------------------------------------------- --------------------------------------------------
Notary Public Robert T. Baird
Notary Public, Glynn County, Georgia
My Commission Expires September 7, 2001
/s/ Rodney E. Bennett
--------------------------------------------------
Rodney E. Bennett
/s/ Walter A. Bennett
--------------------------------------------------
Walter A. Bennet
/s/ Richard L. Brandon, MD
--------------------------------------------------
Richard L. Brandon, MD
/s/ Marshall A. Ham
--------------------------------------------------
Marshall A. Ham
/s/ Cecily A. Hill
--------------------------------------------------
Cecily A. Hill
/s/ Wayne E. Knox
--------------------------------------------------
Wayne E. Knox
/s/ David L. Knox, Sr.
--------------------------------------------------
David L. Knox, Sr.
/s/ Sheila A. Meadows
--------------------------------------------------
Sheila A. Meadows
/s/ Bill F. Raulerson
--------------------------------------------------
Bill F. Raulerson
/s/ Steve E. Rawl
--------------------------------------------------
Steve E. Rawl
/s/ Mary F. Slaughter
--------------------------------------------------
Mary F. Slaughter
/s/ Curtis J. Tumlin, III
--------------------------------------------------
Curtis J. Tumlin, III
</TABLE>
<PAGE> 1
EXHIBIT 10.3
ESCROW AGREEMENT
THIS ESCROW AGREEMENT (this "Agreement"), dated as of March 31, 1999,
is by and between Satilla Financial Services, Inc., a Georgia corporation (the
"Company"), and The Bankers Bank, Atlanta, Georgia (the "Escrow Agent").
WITNESSETH:
WHEREAS, the Company proposes to publicly offer and sell (the
"Offering") a minimum of 450,000 shares (the "Minimum Offering") and a maximum
of 550,000 shares (the "Maximum Offering") of its common stock, par value $.01
per share (the "Shares"), at a price of $10.00 per Share in cash;
WHEREAS, the Offering will be made pursuant to a Prospectus dated
__________, 1999 (the "Prospectus") and a related Subscription Agreement, (the
"Subscription Agreement"), each of which will be distributed to prospective
investors and a form of each of which has been delivered to the Escrow Agent;
WHEREAS, the Company desires to establish an escrow account (the
"Escrow Account") to hold and invest subscription funds ("Subscription Funds")
that are delivered by subscribers in the Offering ("Subscribers") pending
satisfaction of the conditions to the Minimum Offering, and the Escrow Agent is
willing to serve as escrow agent upon the terms and conditions set forth herein;
NOW, THEREFORE, in consideration of the foregoing, and for other good
and valuable consideration, the receipt and sufficiency of which is hereby
acknowledged, the parties hereto, intending to be legally bound, agree as
follows:
1. DEPOSIT WITH ESCROW AGENT.
(a) The Escrow Agent understands that, pursuant to the
instructions contained in the Prospectus and the Subscription Agreement,
Subscribers in the Offering shall deliver to the Company a completed
Subscription Agreement together with Subscription Funds for the Shares
subscribed. The Company will accept only those subscriptions that satisfy the
following conditions:
(i) the Subscription Agreement is properly completed and signed;
(ii) the Subscription Agreement is for the purchase of at least 200
Shares;
(iii) the Subscription Agreement is accompanied by Subscription
Funds in an amount sufficient to pay for all subscribed
Shares; and
(iv) the Subscription Funds are paid by check, money order or other
bona fide payment instrument to "The Bankers Bank, Satilla
Escrow Agent."
<PAGE> 2
If any of the foregoing conditions is not satisfied, the
Company will promptly return the Subscription Agreement and the Subscription
Funds to the Subscriber, showing the defects and requesting correction and
return of a properly completed Subscription Agreement and related payments, and
the Escrow Agent shall have no obligations with respect to such rejected
subscriptions.
(b) With respect to all subscriptions that satisfy the
conditions set forth in Section 1(a), the Company will promptly forward to the
Escrow Agent: (i) a copy of the Subscription Agreement, which sets forth, among
other things, the Subscriber's name and address, certified tax identification
number, and the number of Shares subscribed, and (ii) the Subscription Funds
payable to the Escrow Agent for the number of Shares subscribed.
(c) The Escrow Agent agrees that it will from time to
time accept, in its capacity as escrow agent, Subscription Funds for the Shares,
which have been forwarded to the Escrow Agent by the Company, and which, upon
collection, the Escrow Agent will invest in accordance with Section 2 hereof.
The Escrow Agent agrees that it will not accept any Subscription Agreements or
Subscription Funds sent from Subscribers directly to the Escrow Agent, and that,
in the event the Escrow Agent does receive Subscription Agreements or
Subscription Funds directly from Subscribers, the Escrow Agent shall promptly
forward them to the Company.
(d) All checks shall be made payable to the Escrow Agent.
If any check does not clear normal banking channels in due course, the Escrow
Agent will promptly notify the Company. Any check which does not clear normal
banking channels and is returned by the drawer's bank to the Escrow Agent will
be promptly turned over to the Company along with all other subscription
documents relating to such check. Any check received that is made payable to a
party other than the Escrow Agent shall be returned to the Company for return to
the proper party. The Company in its sole and absolute discretion may reject any
subscription for Shares for any reason and upon such rejection it shall notify
and instruct the Escrow Agent in writing to return the Escrowed Funds by check
made payable to the Subscriber.
2. INVESTMENT OF ESCROWED FUNDS. Upon collection of
each check by the Escrow Agent, the Escrow Agent shall invest the accepted
Subscription Funds (following their acceptance by the Escrow Agent, the
"Escrowed Funds") in deposit accounts or certificates of deposit which are fully
insured by the Federal Deposit Insurance Corporation or another agency of the
United States government, short-term securities issued or fully guaranteed by
the United States government, federal funds, or such other investments as the
Escrow Agent and the Company shall agree. The Company shall provide the Escrow
Agent with instructions from time to time concerning in which of the specific
investment instruments described above the Escrowed Funds shall be invested, and
the Escrow Agent shall adhere to such instructions. Unless and until otherwise
instructed by the Company, the Escrow Agent shall by means of a "sweep" or other
automatic investment program invest the Escrowed Funds in blocks of $10,000 in
federal
2
<PAGE> 3
funds. Interest and other earnings shall start accruing on such funds as soon as
such funds would be deemed to be available for access under applicable banking
laws and pursuant to the Escrow Agent's own banking policies.
3. DISTRIBUTION OF ESCROWED FUNDS. The Escrow Agent shall
distribute the Escrowed Funds in the amounts, at the times, and upon the
conditions hereinafter set forth in this Agreement.
(a) If at any time on or prior to the Expiration Date of the
Offering (as defined in the Prospectus), (i) the Escrow Agent has certified to
the Company in writing that the Escrow Agent has received at least $4,500,000 in
Escrowed Funds, and (ii) the Escrow Agent has received written confirmation from
the President or the Chairman of the Board of Directors of the Company that all
other conditions to the release of funds as described in the Prospectus with
respect to the Minimum Offering have been met, then, upon the direction of the
Company, the Escrow Agent shall deliver the Escrowed Funds to the Company in the
manner specified by the Company. If, however, any portion of the Escrowed Funds
are not collected funds, then the Escrow Agent shall notify the Company of such
fact and shall distribute such funds to the Company only after such funds become
collected funds. For purposes of this Agreement, "collected funds" shall mean
all funds received by the Escrow Agent which have cleared the normal bank
collection process and are available to the Escrow Agent hereunder.
(b) If the Escrowed Funds do not, on or prior to the Closing Date,
become deliverable to the Company based on failure to meet the conditions
described in Paragraph 3(a), or if the Company terminates the Offering without
completing the Subscriptions received and accepted, at any time prior to the
Closing Date and delivers written notice to the Escrow Agent of such
termination, then the Escrow Agent shall return the collected Escrowed Funds to
Subscribers whose Subscription Agreements and Subscription Funds were accepted
by the Company, in amounts equal to the Subscription Funds paid by each of them,
plus interest earned thereon divided amongst the Subscribers according to the
number of Shares subscribed and the amount of time the Subscriber's Subscription
Funds have been held in escrow by the Escrow Agent.
The specific allocation of interest and net profits attributable to
each Subscriber shall be determined by the Escrow Agent as follows: each
Subscriber's allocated share of earnings on the Escrowed Funds, after deducting
the Escrow Agent's fees hereunder, if any, shall be that fraction (i) the
numerator of which is equal to (x) the amount of each Subscriber's accepted
Subscription Funds multiplied by (y) the number of days between the date that
the Escrow Agent collected such funds and the date of the Offering's termination
(with respect to each Subscriber, the Subscriber's "Time Subscription Factor"),
and (ii) the denominator of which is equal to the aggregate Time Subscription
Factors of all Subscriber's depositing Escrowed Funds in the Escrow Account.
All Subscription Funds which have been delivered to the Escrow Agent
by the Company but which have not been collected shall first be collected by the
Escrow Agent
3
<PAGE> 4
and subsequently returned to the respective Subscribers without interest. The
Company is aware and understands that, until it becomes entitled to receive the
Escrowed Funds, as described in Section 3(a) hereof, the Company is not entitled
to any Escrow Funds, and that no amounts deposited in the Escrow Account shall
become the property of, or become subject to the debts of, the Company or any
other entity.
4. FEE OF ESCROW AGENT. The Escrow Agent will accrue a service
charge of $15.00 per each month that it holds Escrowed Funds. In addition, a
$20.00 per check fee will be charged if the Escrow Account has to be refunded
due to a failure to complete the Offering. The Escrow Agent is hereby authorized
to deduct such fees from the Escrowed Funds prior to any release thereof
pursuant to Section 3 hereof.
5. LIABILITY OF ESCROW AGENT.
(a) In performing any of its duties under the Agreement or upon
the claimed failure to perform its duties hereunder, the Escrow Agent shall not
be liable to anyone for any damages, losses or expenses which it may incur as a
result of any action or failure to act by the Escrow Agent that is taken or
omitted to be taken in good faith by the Escrow Agent; provided, however, that
the Escrow Agent shall be liable for damages arising out of its willful
misconduct, gross negligence or breach of this Agreement. Accordingly, the
Escrow Agent shall not incur any such liability with respect to (i) any action
taken or omitted to be taken in good faith upon advice of its counsel or counsel
for the Company which is given with respect to any questions relating to the
duties and responsibilities of the Escrow Agent hereunder; or (ii) any action
taken or omitted to be taken in reliance upon any document, including any
written notice or instructions provided for this Escrow Agreement, not only as
to its due execution and to the validity and effectiveness of its provisions but
also as to the truth and accuracy of any information contained therein, if the
Escrow Agent shall in good faith believe such document to be genuine, to have
been signed or presented by a proper person or persons, and that is consistent
with the provisions of this Agreement.
(b) The Company agrees to indemnify and hold harmless the Escrow
Agent against any and all losses, claims, damages, liabilities and expenses,
including, without limitation, reasonable costs of investigation and counsel
fees and disbursements which may be incurred by the Escrow Agent in connection
with its acceptance of this appointment as Escrow Agent or the performance of
its duties hereunder, including, without limitation, any litigation arising from
this Escrow Agreement or involving the subject matter thereof; provided,
however, that that if the Escrow Agent shall be found guilty of breaching this
Agreement or engaging in willful misconduct or gross negligence in connection
herewith, then the Escrow agent shall bear all such losses, claims, damages and
expenses.
(c) If a dispute arises between any of the parties hereto which,
in the opinion of the Escrow Agent, is sufficient to justify its doing so, the
Escrow Agent shall retain legal counsel of its choice as it reasonably may deem
necessary to advise it concerning its obligations hereunder and to represent it
in any litigation to which it may be a party by
4
<PAGE> 5
reason of this Agreement. The Escrow Agent shall be entitled to tender into the
registry or custody of any court of competent jurisdiction all money or property
in its hands under the terms of this Agreement, and to file such legal
proceedings as it deems appropriate, and shall thereupon by discharged from all
further duties under this Agreement. Any such legal action may be brought in any
such court as the Escrow Agent shall determine to have jurisdiction thereof. In
connection with such dispute, the Company shall indemnify the Escrow Agent
against its court costs and reasonable attorney's fees incurred.
(d) The Escrow Agent may resign at any time upon giving thirty
(30) days written notice to the Company. If a successor escrow agent is not
appointed by the Company within thirty (30) days after notice of resignation,
the Escrow Agent may petition any court of competent jurisdiction to name a
successor escrow agent, and the Escrow Agent herein shall be fully relieved of
all liability under this Agreement to any and all parties upon transfer of the
Escrowed Funds and all related documentation thereto, including appropriate
information to assist the successor escrow agent with the reporting of earnings
of the Escrowed Funds to the appropriate state and federal agencies in
accordance with the applicable state and federal income tax laws, to the
successor escrow agent designated by the Company or appointed by a court.
6. APPOINTMENT OF SUCCESSOR. The Company may, upon the delivery
of thirty (30) days written notice appointing a successor escrow agent to the
Escrow Agent, terminate the services of the Escrow Agent hereunder. In the event
of such termination, the Escrow Agent shall immediately effect the transfer of
the Escrowed Funds and all related documentation thereto, including appropriate
information to assist the successor escrow agent with the reporting of earnings
of the Escrowed Funds to the appropriate state and federal agencies in
accordance with the applicable state and federal income tax laws, less any fees
and expenses due to be paid to the Escrow Agent or required to be paid by the
Escrow Agent to a third party pursuant to this Agreement.
5
<PAGE> 6
7. NOTICE. All notices, requests, demands and other
communications or deliveries required or permitted to be given hereunder shall
be in writing and, in the case of notices, requests or demands made other than
by facsimile, shall be deemed to have been duly given three (3) days after
having been deposited for mailing if sent by registered mail, or certified mail
return receipt requested, or delivery by courier, to the respective addresses
set forth below:
<TABLE>
<S> <C>
IF TO THE SUBSCRIBERS FOR SHARES: To their respective
addresses as specified in
their Subscription
Agreements.
THE COMPANY: Satilla Financial Services, Inc.
180 Mariners Drive
Kingsland, Georgia 31548
Attention: Rodney E. Bennett
Telephone: (912) 882-4775
Facsimile: (912) 882-1780
WITH A COPY TO: Alston & Bird LLP
One Atlantic Center
1201 West Peachtree Street
Atlanta, Georgia 30309-3424
Attention: Ralph F. MacDonald, III
Telephone: (404) 881-7582
Facsimile: (404) 881-4777
THE ESCROW AGENT: The Bankers Bank
2410 Paces Ferry Road
600 Paces Summit
Atlanta, GA 30339-4098
Attention: Mr. William R. Burkett
</TABLE>
8. REPRESENTATIONS OF THE COMPANY. The Company hereby
acknowledges that the Escrow Agent shall have the duties and responsibilities
stated herein, and the Company agrees it will not represent or imply that the
Escrow Agent, by serving as the Escrow Agent hereunder or otherwise, has
investigated the desirability or advisability in an investment in the Shares, or
has approved, endorsed or passed upon the merits of the Shares. The Company
shall not use the name of the Escrow Agent in any manner whatsoever in
connection with the offer or sale of the Shares, other than disclosing the
Agreement, the Escrow Agent's services hereunder, and the Escrow Agent's name
and address to potential investors in the Offering.
6
<PAGE> 7
9. GENERAL.
(a) This Agreement shall be governed by and construed in
accordance with the laws of the State of Georgia.
(b) The section headings contained herein are for reference
purposes only and shall not in any way affect the meaning or interpretation of
this Agreement.
(c) This Agreement sets forth the entire agreement and
understanding of the parties with regard to this escrow transaction and
supersedes all prior agreements, arrangements and understandings relating to the
subject matter hereof.
(d) This Agreement may be amended, modified, superseded or
canceled, and any of the terms or conditions hereof may be waived, only by a
written instrument executed by each party hereto or, in the case of a waiver, by
the party waiving compliance. The failure of any party at any time or times to
require performance of any provision hereof shall in no manner affect the right
to require such performance at a later time. No waiver in any one or more
instances by any part of any condition, or of the breach of any term contained
in this Agreement, whether by conduct or otherwise, shall be deemed to be, or
construed as, a further or continuing waiver of any such condition or breach, or
a waiver of any other condition or of the breach of any other terms of this
Agreement.
(e) This Agreement may be executed simultaneously in two or more
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument.
(f) This Agreement shall inure to the benefit of the parties
hereto and their respective permitted successors and assigns. The Escrow Agent
shall be bound only by the terms of this Escrow Agreement and shall not be bound
by or incur any liability with respect to any other agreement or understanding
between the parties except as herein expressly provided. The Escrow Agent shall
not have any duties hereunder except those specifically set forth herein.
(g) No interest in any part to this Agreement shall be assignable
in the absence of a written agreement by and between all the parties to this
Agreement, executed with the same formalities as this original Agreement.
7
<PAGE> 8
IN WITNESS WHEREOF, the parties have duly executed this Agreement as of
the date first written above.
SATILLA FINANCIAL SERVICES, INC.
By: /s/ Rodney E. Bennett
------------------------------
Name: Rodney E. Bennett
Title: President and
Chief Executive Officer
By: /s/ David L. Knox, Sr.
------------------------------
Name: David L. Knox, Sr.
Title: Chairman
THE BANKERS BANK
By: /s/ William R. Burkett
------------------------------
Name: William R. Burkett
Title: Senior Vice President
8
<PAGE> 1
EXHIBIT 10.4
OPTION AGREEMENT
OPTION AGREEMENT made this 21st day of October, 1998 between CECILY HILL,
SHEILA MEADOWS, MELODIE PAGE, ELESE STOVER, and JENNIFER WRIGHT (collectively
referred to as the "Optioner"), of Camden County, Georgia, and SATILLA
COMMUNITY BANK and/or SATILLA FINANCIAL SERVICES, INC., (the
Page 4 -- Exhibit "B"
"Optionee"), of Camden
Option Agreements
In consideration of $5,000.00 (hereinafter
called the "option money"), by the Optionee to the Optionor, by check payable
to the order of the Optionor, the receipt whereof, subject to collection, the
Optionor acknowledges, and also in consideration of the promises and conditions
hereinafter contained, the parties agree as follows:
1.
GRANT OF OPTION. The Optionor hereby irrevocably grants to the Optionee
the exclusive option to purchase from the Optionor, on and subject to the terms
and conditions hereinafter contained, all of the Optionor's interest in the
property (hereinafter called "property") described as follows, to-wit:
All that certain tract or parcel of land being a 1.183 acre tract of land
on Georgia Highway 40, lying in the City of St. Marys, 29th G.M.D., Camden
County, Georgia, and being more particularly described as follows: for a
point of beginning commence at a point where the northeasterly right-of-way
line of Georgia Highway No. 40, (a 75-foot right-of-way as now
established), intersects the southeasterly right-of-way line of an
un-named county graded road, a 30-foot road right-of-way by plat recorded
in plat book 6, page 121, public records of said county), and from said
point run thence north 56 degrees 37' 06" east, along last mentioned
southeasterly right-of-way line, a distance of 95.57 feet to a point of
-1-
<PAGE> 2
curvature; run thence in a northeasterly direction along the arc of a curve in
last mentioned southeasterly right-of-way line, said curve being concave to the
northwest and having a radius of 293.77 feet, a chord distance of 69.03 feet to
a point of curvature, the bearing of the aforementioned chord being north 49
degrees 52' 17" east; run thence in an easterly direction along the arc of a
curve, said curve being concave to the north and having a radius of 25.0 feet,
a cord distance of 32.16 feet to a point of compound curvature, the bearing of
the aforementioned chord being north 83 degrees 09' 24" east; run thence in a
southeasterly direction along the arc of a curve, said curve being concave to
the southwest and having a radius of 132.94 feet, a chord distance of 68.43
feet to a point of tangency, the bearing of the aforementioned chord being
south 41 degrees 53' 49" east; run thence south 26 degrees 58' 57" east, a
distance of 159.15 feet to a point of curvature; run thence in a southerly
direction along the arc of a curve, said curve being concave to the west and
having a radius of 25.00 feet, a chord distance of 35.36 feet to a point of
tangency, the bearing of the aforementioned cord being south 18 degrees 01' 03"
west; run thence south 63 degrees 01' 03" west, a distance of 185.00 feet to a
point lying on the aforementioned northeasterly right-of-way line of Georgia
Highway No. 40; run thence north 26 degrees 58' 57" west, along last mentioned
northeasterly right-of-way line, a distance of 235.00 feet to the point of
beginning.
The land thus described contained 1.183 acres and is subject to any
easements of records that may lie within.
2.
TERM OF OPTION. This option shall continue in effect until noon on June 30,
1999, and may be exercised (in accordance with its terms) at any time on or
before its expiration; provided, however, that this option shall automatically
terminate (without any notice from Optionor to the Optionee) at noon on June 30,
1999.
3.
EXERCISE OF OPTION. If this option is exercised (in accordance with its
terms) the Optionor shall sell and convey the property to the Optionee, and the
Optionee shall purchase and accept the property from the Optionor, on and
subject to the terms and
-2-
<PAGE> 3
conditions contained in said agreement.
4.
TERMS AND CONDITIONS. The terms of this option are as follows:
a) The Optionor agrees to convey to the Optionee the right to purchase
the property described above and owned by the Optionor at the purchase
price of Two Hundred Thirty Thousand Dollars ($230,000.00) due and
payable in full on or before June 30, 1999. The option money shall be
credited against the purchase price.
b) Upon payment in full of the indebtedness and obligation pursuant to
this agreement by Optionor and Optionee, Optionor shall immediately
execute a Warranty Deed conveying the subject property to Optionee,
free and clear of any and all liens or encumbrances.
5.
FAILURE TO EXERCISE OPTION. If prior to noon on June 30, 1999 all
conditions contained herein shall have accrued, and the Optionee does not
purchase the property in accordance with the terms of this agreement, the
Optionor shall retain absolutely the option money paid on the execution of this
option agreement as the consideration for this option during the period to noon
on June 30, 1999.
6.
OTHER CONDITIONS. Other conditions of the option agreement shall be as
follows:
-3-
<PAGE> 4
As to Optionor:
a) The Optionor shall provide ingress and egress to the property
sufficient for its intended purpose, that being a commercial banking
facility.
b) The Optionor shall provide all utility service necessary for the
property for its intended purpose, that being a commercial banking
facility.
c) The Optionor shall have taken all actions necessary for the property
to be in compliance with all applicable requirements, restrictions and
limitations of federal, state and local statute, law, ordinance, rule
and regulation to allow construction to commence and use of the
property as a commercial banking facility.
As to Optionee:
a) Should the Optionee fail to obtain all necessary approvals or not have
established a commercial banking enterprise within the time period
prescribed by this option agreement, the Optionor shall return the
option money to the Optionee and this option agreement shall be
rendered null and void.
7.
ENTIRE AGREEMENT. This option constitutes the entire agreement between
the parties. No representatives, warranties, or promises pertaining to this
option or any property affected by this option have been made by, or shall be
binding on, any of the parties, except as expressly stated in this option
agreement. This option agreement may not be changed orally, but only by an
agreement in writing signed by the party against
-4-
<PAGE> 5
whom enforcement of any such change is sought.
8.
NOTICES. Any notice or demand under this option shall be by registered or
certified mail, sent as follows: to the Optionor at 2353 Village Drive,
Kingsland, Georgia 31548 and to the Optionee at Post Office Box 5400, St.
Marys, Georgia 31558.
9.
TAXES. The Optionor and Optionee agree that Optionor shall be responsible
for all taxes until the time of closing.
10.
BENEFIT. This option shall bind, the heirs, successors and assigns of the
respective parties.
IN WITNESS WHEREOF, the parties hereto have executed and delivered this
Agreement the day and year first above mentioned.
OPTIONOR:
/s/ Cecily Hill (SEAL)
------------------------
Cecily Hill
Signed, sealed and delivered in the
presence of:
/s/ Judy Lott
- ------------------------------------
Witness
/s/ Bernetta J. Place
- ------------------------------------
Notary Public
Notary Public, Camden County, Georgia
My Commission Expires Feb. 7, 2002
(SIGNATURES CONTINUED ON NEXT PAGE)
-5-
<PAGE> 6
/s/ Sheila Meadows
------------------------------ (SEAL)
Sheila Meadows
Signed, sealed and delivered in the
presence of:
Judy Lott
- -------------------------------------
Witness
Bernetta J. Place
- -------------------------------------
Notary Public
Notary Public, Camden County, Georgia
My Commission Expires Feb. 7, 2002
/s/ Melodie Page
------------------------------ (SEAL)
Melodie Page
Signed, sealed and delivered in the
presence of:
Judy Lott
- -------------------------------------
Witness
Bernetta J. Place
- -------------------------------------
Notary Public
Notary Public, Camden County, Georgia
My Commission Expires Feb. 7, 2002
/s/ Elese Stover
------------------------------ (SEAL)
Elese Stover
Signed, sealed and delivered in the
presence of:
Judy Lott
- -------------------------------------
Witness
Bernetta J. Place
- -------------------------------------
Notary Public
Notary Public, Camden County, Georgia
My Commission Expires Feb. 7, 2002
/s/ Jennifer Wright
------------------------------ (SEAL)
Jennifer Wright
Signed, sealed and delivered in the
presence of:
Judy Lott
- -------------------------------------
Witness
Bernetta J. Place
- -------------------------------------
Notary Public
Notary Public, Camden County, Georgia
My Commission Expires Feb. 7, 2002
(SIGNATURES CONTINUED ON NEXT PAGE)
-6-
<PAGE> 7
OPTIONEE:
By: /s/
------------------------------ (SEAL)
Chairman
Attest: /s/
------------------------------ (SEAL)
President
Signed, sealed and delivered in the
presence of:
Pam Jeffries
- -------------------------------------
Witness
Kristina Allen
- -------------------------------------
Notary Public
Notary Public, Camden County, Georgia
My Commission Expires Sept. 7, 2001
-7-
<PAGE> 1
Exhibit 10.5
OPTION AGREEMENT
OPTION AGREEMENT made this 10th day of November, 1998 between M. ANTHONY
HAM (the "Optionor"), of Brantley County, Georgia, and SATILLA COMMUNITY BANK
and/or SATILLA FINANCIAL SERVICES, INC., (the "Optionee"), of Camden County,
Georgia.
In consideration of the payment of the aggregate sum of $10,000.00
(hereinafter called the "option money"), by the Optionee to the Optionor, by
check payable to the order of the Optionor, the receipt whereof, subject to
collection, the Optionor acknowledges, and also in consideration of the promises
and conditions hereinafter contained, the parties agree as follows:
1.
GRANT OF OPTION. The Optionor hereby irrevocably grants to the Optionee the
exclusive option to purchase from the Optionor, on and subject to the terms and
conditions hereinafter contained, all of the Optionor's interest in the property
(hereinafter called the "property") described as follows, to-wit:
Lots 5,6,7,8,41,42,43, and 44 of Block I of Land Lot 88, City of Nahunta,
County of Brantley, State of Georgia. (See Exhibit "A" attached hereto.)
2.
TERM OF OPTION. This option shall continue in effect until noon on June 30,
1999, and may be exercised (in accordance with its terms) at any time on or
before its expiration; provided, however, that this option shall automatically
terminate (without any notice from Optionor to the Optionee) at noon on June 30,
1999.
-1-
<PAGE> 2
3.
EXERCISE OF OPTION. If this option is exercised (in accordance with its
terms) the Optionor shall sell and convey the property to the Optionee, and the
Optionee shall purchase and accept the property from the Optionor, on and
subject to the terms and conditions contained in said agreement.
4.
TERMS AND CONDITIONS. The terms of this option are as follows:
a) The Optionor agrees to convey to the Optionee the right to purchase
the property described above and owned by the Optionor at the purchase
price of One Hundred Sixty Thousand Dollars ($160,000.00) cash due and
payable in full on or before June 30, 1999, in addition to the
exchange of the lots described in paragraph 1 above and reflected in
Exhibit "A". The option money shall be credited against the purchase
price.
b) Upon payment in full of the indebtedness and obligation pursuant to
this agreement by Optionor and Optionee, Optionor shall immediately
execute a Warranty Deed conveying the subject property to Optionee,
free and clear of any and all liens or encumbrances.
FAILURE TO EXERCISE OPTION. If prior to noon on June 30, 1999 all
conditions contained herein shall have accrued, and the Optionee does not
purchase the property in accordance with the terms of this agreement, the
Optionor shall retain absolutely the option money paid on the execution of this
option agreement as the
-2-
<PAGE> 3
consideration for this option during the period to noon on June 30, 1999.
6.
OTHER CONDITIONS. Other conditions of the option agreement shall be as
follows:
As to Optionor:
a) The Optionor shall provide ingress and egress to the property
sufficient for its intended purpose, that being a commercial banking
facility.
b) The Optionor shall provide all utility service necessary for the
property for its intended purpose, that being a commercial banking
facility.
c) The Optionor shall have taken all actions necessary for the property
to be in compliance with all applicable requirements, restrictions and
limitations of federal, state and local statute, law, ordinance, rule
and regulation to allow construction to commence and use of the
property as a commercial banking facility.
As to Optionee:
a) Should the Optionee fail to obtain all necessary approvals or not have
established a commercial banking enterprise within the time period
prescribed by this option agreement, the Optionor shall not return the
option money to the Optionee and this option agreement shall be
rendered null and void.
-3-
<PAGE> 4
7.
ENTIRE AGREEMENT. This option constitutes the entire agreement between the
parties. No representatives, warranties, or promises pertaining to this option
or any property affected by this option have been made by, or shall be binding
on, any of the parties, except as expressly stated in this option agreement.
This option agreement may not be changed orally, but only by an agreement in
writing signed by the party against whom enforcement of any such change is
sought.
8.
NOTICE. Any notice or demand under this option shall be by registered or
certified mail, sent as follows: to the Optionor at P.O. Box 342 - Nahunta, Ga.
31553 and to the Optionee at Post Office Box 5400, St. Marys, Georgia 31558.
9.
TAXES. The Optionor and Optionee agree that Optionor shall be responsible
for all taxes until the time of closing.
10.
BENEFIT. This option shall bind, the heirs, successors and assigns of the
respective parties.
-4-
<PAGE> 5
IN WITNESS WHEREOF, the parties hereto have executed and delivered this
Agreement the day and year first above mentioned.
OPTIONOR:
/s/ M. Anthony Ham (SEAL)
--------------------
M. Anthony Ham
Signed, sealed and delivered in the
presence of
Doretha M. Lismore
- -------------------
Witness
Kristina E. Allen
- -------------------
Notary Public
Notary Public, Glynn County, Georgia
My Commission Expires September 7, 2001
OPTIONEE:
BY: /s/ (SEAL)
--------------------
ATTEST:
----------------(SEAL)
Signed, sealed and delivered in the
presence of
Doretha M. Lismore
- -------------------
Witness
Kristina E. Allen
- -------------------
Notary Public
Notary Public, Glynn County, Georgia
My Commission Expires September 7, 2001
<PAGE> 6
(ROAD MAP)
- -----------------------------------------
THIS PROPERTY, BEING WITHIN THE CITY
LIMITS OF NAHUNTA, GEORGIA, IS EXEMPT
FROM THE OFFICIAL CODE OF GEORGIA
ANNOTATED 15-6-67, AS AMENDED BY
SENATE BILL NO. 735, APPROVED
APRIL 11, 1990.
- ----------------------------------------- [SEAL]
THE EAST RIGHT-OF-WAY LINE OF CANNON
STREET WAS DETERMINED BY THE GEORGIA
DEPARTMENT OF TRANSPORTATION UNDER THE
GEORGIA CODE OF PUBLIC TRANSPORTATION
95A-602(c)
<TABLE>
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
THE FILED DATA UPON WHICH THIS PLAT IS BASED HAS SURVEY FOR
A CLOSURE PRECISION OF ONE FOOT IN 10,000 FEET ANTHONY HALL
AND AN REGULAR ERROR OF H/A PER ANGLE POINT. -------------------------------------------------------------------------------
AND WAS ADJUSTED USING H/A RULE AREA COUNTY CITY
1.IHS 88 2HD BRANTLEY NAHUNTA
THIS PLAT HAS BEEN CALCULATED FOR CLOSURE AND -------------------------------------------------------------------------------
IS FOUND TO BE ACCURATE WITHIN ONE FOOT IN DATE SCALE GEORGIA
1,111 FEET SEPT. 7, 1995
-------------------------------------------------------------------------------
- -------------------------------------------------- LEGEND SCALE IN FEET
EQUIPMENT USED ==== ==== ==== ====================
G15-7 ( ) : IRON PER SET 100 0 100
- -------------------------------------------------- - : IRON PER ROUND HUGH D. THOMAS
THIS PLAT HAS BEEN RECORDED IN PLAT BOOK ________ [ ] : CONCRETE MARKER SET
PAGE _______, IN THE OFFICE OF THE CLERK OF THE -- : COND MARKER FOUND , GA
SUPERIOR COURT OF _____________ COUNTY, GEORGIA ---------------------------- PHONE 458-7718
THIS ______ DAY OF _________, 19___. TIME _______
---------------------------- APPROVED HUGH D. THOMAS
________________________________________
CLERK OF SUPERIOR COURT GEORGIA REGISTERED LAND SURVEYOR NO. 1395
- ------------------------------------------------------------------------------------------------------------------------------------
</TABLE>
<PAGE> 1
EXHIBIT 23.2
[LOGO] [THIGPEN, JONES, SEATON & CO., P.C. LETTERHEAD]
We have issued our report dated February 26, 1999 on the accompanying
financial statements of Satilla Financial Services, Inc. as included in the SB-2
Registration Statement and Prospectus. We consent to the use of the
aforementioned report in this Form SB-2 Registration Statement and Prospectus
and to the use of our name as it appears under the caption "Experts."
/s/ Thigpen, Jones, Seaton & Co., PC
Dublin, Georgia
April 5, 1999
<TABLE> <S> <C>
<ARTICLE> 9
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> DEC-31-1998
<PERIOD-START> JUL-01-1998
<PERIOD-END> DEC-31-1998
<CASH> 13,430
<INT-BEARING-DEPOSITS> 0
<FED-FUNDS-SOLD> 0
<TRADING-ASSETS> 0
<INVESTMENTS-HELD-FOR-SALE> 0
<INVESTMENTS-CARRYING> 0
<INVESTMENTS-MARKET> 0
<LOANS> 0
<ALLOWANCE> 0
<TOTAL-ASSETS> 28,430
<DEPOSITS> 0
<SHORT-TERM> 70,000
<LIABILITIES-OTHER> 5,000
<LONG-TERM> 0
0
0
<COMMON> 13
<OTHER-SE> (46,583)
<TOTAL-LIABILITIES-AND-EQUITY> 28,430
<INTEREST-LOAN> 0
<INTEREST-INVEST> 0
<INTEREST-OTHER> 0
<INTEREST-TOTAL> 0
<INTEREST-DEPOSIT> 0
<INTEREST-EXPENSE> 0
<INTEREST-INCOME-NET> 0
<LOAN-LOSSES> 0
<SECURITIES-GAINS> 0
<EXPENSE-OTHER> 59,570
<INCOME-PRETAX> (59,570)
<INCOME-PRE-EXTRAORDINARY> (59,570)
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (59,570)
<EPS-PRIMARY> (45.82)
<EPS-DILUTED> (45.82)
<YIELD-ACTUAL> 0
<LOANS-NON> 0
<LOANS-PAST> 0
<LOANS-TROUBLED> 0
<LOANS-PROBLEM> 0
<ALLOWANCE-OPEN> 0
<CHARGE-OFFS> 0
<RECOVERIES> 0
<ALLOWANCE-CLOSE> 0
<ALLOWANCE-DOMESTIC> 0
<ALLOWANCE-FOREIGN> 0
<ALLOWANCE-UNALLOCATED> 0
</TABLE>
<PAGE> 1
EXHIBIT 99.1
SUBSCRIPTION AGREEMENT
The undersigned (individually and collectively, the "Subscriber"),
intending to be legally bound, hereby applies to Satilla Financial Services,
Inc. (the "Company") to purchase the number of shares of Company's $.01 par
value common stock (the "Shares") at $10.00 per share (the "Purchase Price")
specified below, in accordance with the terms and conditions of this Agreement
and the Company's Offering of Shares pursuant to the accompanying Prospectus
dated March __, 1999 (the "Prospectus").
1. Receipt of Prospectus. The Subscriber has received and read a copy of
the Prospectus and understands and agrees that upon acceptance by the Company,
this Subscription will be a binding obligation of the Subscriber to purchase the
shares subscribed.
2. Purchase for Subscriber's Account Only. The Subscriber represents,
warrants, and covenants that he is offering this Subscription Agreement and will
purchase the Shares solely for his own account and for the person(s) in whose
name(s) such shares are to be registered as set forth below.
3. Minimum Purchase. The Subscriber understands that the minimum number of
Shares that may be subscribed in the Offering is 200, and that the Company will
reject and return any subscription for less than 200 Shares.
4. Payment and Delivery of Subscription. ALL CHECKS IN PAYMENT OF
SUBSCRIPTIONS MUST ACCOMPANY THIS SUBSCRIPTION AGREEMENT AND SHALL BE PAYABLE TO
"THE BANKERS BANK, SATILLA ESCROW AGENT". All Shares subscribed and made
available to the undersigned Subscriber by the Company must be paid in full
before the Company will be obligated to issue any Shares in respect of such
Subscription. SUBSCRIPTION AGREEMENTS AND CHECKS IN PAYMENT FOR SHARES
SUBSCRIBED SHOULD BE DELIVERED TO SATILLA FINANCIAL SERVICES, INC., 180 MARINERS
DRIVE, KINGSLAND, GEORGIA 31548, ATTENTION: DAVID L. KNOX, SR. The Offering is
scheduled to terminate on _____________ , 1999, but the Company reserves the
right, in its sole discretion, to extend, suspend or terminate the Offering at
any time.
5. Escrow Agent; Rejection of Subscription. The Subscriber understands and
agrees that, as set forth in the accompanying Prospectus, the Company may reject
or accept any subscription, in whole or in part, at any time and for any reason.
In the event that the Company rejects any part of a subscription, the Escrow
Agent will return the rejected portion of the previously paid subscription
funds, together with interest earned on such returned subscription funds, if
any, to the Subscriber.
6. Allocation of Shares. The Subscriber understands and agrees that, as
described in the Prospectus, if fewer than all Shares subscribed for by the
undersigned are accepted by the Company, the excess subscription funds will be
returned to the undersigned without interest. The Subscriber understands and
agrees that, as described in the Prospectus, the Company has, in its sole
discretion, the right to allocate Shares among Subscribers, and to accept or
reject Subscriptions in whole or in part. Only whole Shares will be issued in
the Offering.
7. Delivery of Certificates. As a convenience to the Subscriber, unless
the Subscriber indicates otherwise in the space provided below, the Subscriber
will receive physical delivery of a physical certificate for Shares, registered
in his name, as directed in this Subscription Agreement.
8. Miscellaneous. The Subscriber confirms that he resides at the address
shown hereon and that all information supplied by it is true, accurate, and
complete, and shall constitute representations, warranties, and covenants which
shall survive the execution, delivery, and acceptance of this Subscription
Agreement and the issuance and delivery of the Shares to the Subscriber or his
broker, and/or the return of any subscription funds. When accepted by the
Company, this Agreement shall bind the Subscriber and his successors and
assigns, heirs, personal and legal representatives, and heirs to pay for all
Shares subscribed. The Subscriber may not assign or transfer this Subscription
Agreement or any interest herein, and this Agreement may not be revoked by the
Subscriber. Headings used herein are for convenience of reference only and shall
not be considered in construing the terms of this Agreement. This Subscription
Agreement shall be governed by, and construed in accordance with, the laws of
the State of Georgia.
Shares purchased by the undersigned shall be registered as listed below. In
the absence of any contrary instructions, all Shares subscribed by two or more
individuals will be registered to such persons as joint tenants with rights of
survivorship. (If certificates for Shares are to be issued in more than one
name, please specify whether ownership is to be as tenants in common, joint
tenants, etc. If certificates for Shares are to be issued in the name of one
person for the benefit of another, or in a person's Individual Retirement
Account (or other qualifying retirement account), please indicate whether
registration should be as trustee, custodian, or holder of an IRA/Retirement
Account for each person, and if as trustee, please provide the full name and
date of such trust.)
<PAGE> 2
IN WITNESS WHEREOF, the undersigned, acting with full authority and
capacity has executed, or caused to be executed, this Subscription Agreement.
<TABLE>
- ----------------------------------------------------------- ---------------------------------------------------------------
<S> <C>
Number of Shares subscribed (Minimum of 200 Shares): Name(s) of Subscriber(s):
- ------------------------------------------------ -------------------------------------------------------
-------------------------------------------------------
Total Subscription Price Please PRINT or TYPE exact name(s) in which the
(at $10.00 per Share): $ undersigned desires the Shares to be registered
------------------------
- ----------------------------------------------------------- ---------------------------------------------------------------
</TABLE>
PLEASE INDICATE THE FORM OF OWNERSHIP THE UNDERSIGNED DESIRES FOR THE SHARES:
<TABLE>
<S> <C> <C> <C> <C> <C>
[ ] Individual [ ] Tenants in Common [ ] Joint Tenants with Rights of Survivorship
[ ] Trustee [ ] Custodian [ ] Beneficiary of IRA/Retirement Account
[ ] Corporation [ ] Partnership [ ] Other
--------------------------
</TABLE>
<TABLE>
<S> <C>
- ------------------------------------------------------ ------------------------------------------------------
Social Security or Federal Taxpayer Identification No. Social Security or Federal Taxpayer Identification No.
- ------------------------------------------------------ ------------------------------------------------------
Residence Street Address/Route Residence Street Address/Route
- ------------------------------------------------------ ------------------------------------------------------
City and State Zip City and State Zip
- ------------------------------------------------------ ------------------------------------------------------
Area Code and Telephone Number Area Code and Telephone Number
</TABLE>
- --------------------------------------------------------------------------------
SUBSTITUTE FORM W-9
Under the penalties of perjury, I certify that: (1) the Social Security Number
or Federal Taxpayer Identification Number given above is correct; and (2) I am
not subject to backup withholding either because I have not been notified that
I am subject to backup withholding as a result of a failure to report all
interest or dividends, or because the Internal Revenue Service has notified me
that I am no longer subject to backup withholding. Instructions: You must cross
out #2 above if you have been notified by the Internal Revenue Service that you
are subject to backup withholding because of under reporting interest or
dividends on your tax return and if you have not received a notice from the
Internal Revenue Service advising you that backup withholding due to notified
payee under reporting has terminated.
Signature* Date: , 1999
------------------------ ----------------
- --------------------------------------------------------------------------------
SUBSCRIBER #1 SUBSCRIBER #2 (IF ANY)
- ---------------------------------- -----------------------------------------
Signature* Date Signature* Date
*If a corporation, please sign in full corporate name by president or other
authorized officer. When signing as officer, attorney, custodian, trustee,
administrator, guardian, etc., please give your full title as such. In case of
joint tenants, each person must sign.
DO NOT WRITE BELOW THIS LINE
================================================================================
<TABLE>
<CAPTION>
<S> <C>
Received: , 1999. Accepted as of: , 1999, as to Shares.
------------------- ----------------- ---------
</TABLE>
SATILLA FINANCIAL SERVICES, INC.
By: Title:
----------------------------------- ------------------------------
SUBSCRIBERS MUST SIGN BOTH THIS AGREEMENT AND THE SUBSTITUTE FORM W-9
