UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 14A
PROXY STATEMENT PURSUANT TO SECTION
14(a) OF THE SECURITIES
EXCHANGE ACT OF 1934
(AMENDMENT NO. )
Filed by
the Registrant
x
Filed by
a Party other than the Registrant __
Check the appropriate
box:
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Preliminary Proxy Statement
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CONFIDENTIAL, FOR USE OF THE COMMISSION ONLY (AS PERMITTED BY RULE
14a-6(e)(2))
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x
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Definitive
Proxy Statement
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Definitive Additional Materials
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Soliciting Material under
§
240.14a-12
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THE SAVANNAH BANCORP,
INC.
(NAME OF
REGISTRANT AS SPECIFIED IN ITS CHARTER)
(NAME OF
PERSON(S) FILING PROXY STATEMENT, IF OTHER THAN THE REGISTRANT)
Payment
of Filing Fee (Check the appropriate box):
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Fee
computed on table below per Exchange Act Rules 14a-6(i)(1) and
0-11
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(1)
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Title
of each class of securities to which transaction applies:
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(2)
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Aggregate
number of securities to which transaction applies:
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(3)
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Per
unit price or other underlying value of transaction computed pursuant to
Exchange Act Rule 0-11 (set forth the amount on which the filing fee is
calculated and state how it was determined):
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(4)
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Proposed
maximum aggregate value of transaction:
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Fee
paid previously with preliminary
materials.
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Check
box if any part of the fee is offset as provided by Exchange Act Rule
0-11(a)(2) and identify the filing for which the offsetting fee was paid
previously. Identify the previous filing by registration statement number,
or the Form or Schedule and the date of its filing.
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(1)
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Amount
Previously Paid:
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(2)
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Form,
Schedule or Registration Statement No.:
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The
Savannah Bancorp, Inc.
25
Bull Street
Savannah,
Georgia 31401
912-629-6500
March 29,
2010
Dear
Shareholder,
You are
cordially invited to attend the 2010 Annual Meeting of Shareholders of The
Savannah Bancorp, Inc. which will be held at 11:00 a.m. on Wednesday, April 21,
2010 at the Hyatt Regency, 2 West Bay Street, Savannah, Georgia.
Enclosed
is the Secretary's official Notice of Annual Meeting, a Proxy Statement and a
Proxy card. Please complete, date and sign the enclosed proxy
card and return it promptly to the Company in the envelope provided even if you
do not plan to attend the annual meeting. If you attend the meeting,
you may vote in person even if you have previously returned your proxy
.
If you
own stock in brokerage accounts and receive this information from Broadridge,
you may also vote shares using the Internet. Please follow the
instructions on the enclosed voting materials.
This
Proxy Statement and our Annual Report are also available online at
www.savb.com
.
We look
forward to seeing you on April 21, 2010 at the Hyatt Regency in
Savannah.
Sincerely,
/s/ John C. Helmken II
John C.
Helmken II
President
and Chief Executive Officer
Enclosures
The
Savannah Bancorp, Inc.
NOTICE
OF ANNUAL MEETING OF SHAREHOLDERS
TO
BE HELD ON APRIL 21, 2010
March 29,
2010
NOTICE IS HEREBY GIVEN that the Annual
Meeting of Shareholders of The Savannah Bancorp, Inc. (the "Company") will be
held at the Hyatt Regency, 2 West Bay Street, Savannah, Georgia, on April 21,
2010 at 11:00 a.m., Eastern Daylight Time, for the purpose of considering and
acting upon the following matters:
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I.
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To
elect four Directors of Class II to serve until the Annual Meeting of
Shareholders in 2013,
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II.
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To
ratify the selection of Mauldin & Jenkins, LLC as independent
registered public accountants to audit the Company's financial statements
for the year 2010, and
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III.
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To
transact such other business as may come properly before the Annual
Meeting or any adjournments
thereof.
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Only
shareholders of record of The Savannah Bancorp, Inc. at the close of business on
March 5, 2010, are entitled to notice of and to vote at the
meeting.
BY ORDER OF THE BOARD OF
DIRECTORS
/s/ J. Curtis
Lewis III
J. Curtis Lewis III
Secretary
YOUR
VOTE IS IMPORTANT, WHETHER YOU OWN A FEW SHARES OR MANY.
THE
BOARD OF DIRECTORS OF THE COMPANY UNANIMOUSLY RECOMMENDS THAT SHAREHOLDERS VOTE
IN FAVOR OF THE PROPOSALS REFERRED TO ABOVE AND DESCRIBED IN THE ACCOMPANYING
PROXY STATEMENT.
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TABLE
OF CONTENTS
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Page
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NOTICE
OF ANNUAL MEETING OF SHAREHOLDERS
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i
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TABLE
OF CONTENTS
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ii
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PROXY
STATEMENT
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1
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QUESTIONS
AND ANSWERS ABOUT THE ANNUAL MEETING
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1
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What
is the purpose of the annual meeting?
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1
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Who
is entitled to vote?
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1
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How
do I vote?
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1
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What
are the quorum and voting requirements to approve the
proposals?
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1
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How
are votes counted?
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2
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Will
other matters be voted on at the annual meeting?
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2
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Can
I revoke my proxy instructions?
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2
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What
other information should I review before voting?
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3
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When
will voting results be available?
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3
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PROPOSAL
1: ELECTION OF DIRECTORS
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4
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Introduction
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4
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Recommendation
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4
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Information
About Nominees and Other Directors
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5
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Directors
Compensation
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9
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2009
Director Compensation Table
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10
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Management
Stock Ownership
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PROPOSAL
II: RATIFICATION OF INDEPENDENT REGISTERED PUBLIC
ACCOUNTANTS
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11
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INFORMATION
ABOUT THE BOARD OF DIRECTORS AND CERTAIN COMMITTEES
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11
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Report
of the Audit Committee
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13
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Report
of the Compensation Committee
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14
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Report
of the Director Nominating Committee
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14
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EXECUTIVE
COMPENSATION AND BENEFITS
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15
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Compensation
Discussion and Analysis
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15
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Summary
Compensation Table
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18
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Grants
of Plan-Based Awards
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18
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Outstanding
Option and Stock Awards
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19
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Option
Exercises and Stock Vested
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20
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Nonqualified
Deferred Compensation
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20
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Employment
Agreements
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21
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Ownership
of Equity Securities
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21
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Other
Matters
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22
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March 29,
2010
The
Savannah Bancorp, Inc.
25
Bull Street
Savannah,
Georgia 31401
___________________
PROXY
STATEMENT
___________________
This
proxy statement is furnished in connection with the solicitation of proxies by
the Board of Directors (“Board”) of The Savannah Bancorp, Inc. (“SAVB” or
“Company”) for use at the 2010 Annual Meeting of Shareholders to be held on
Wednesday, April 21, 2010 at 11 a.m., local time, at
the Hyatt Regency, 2 West
Bay Street, Savannah, Georgia
, and at any adjournments or postponements
of the annual meeting.
QUESTIONS
AND ANSWERS ABOUT THE ANNUAL MEETING
What
is the purpose of the annual meeting?
At the
annual meeting, shareholders will act upon the matters set forth in the
accompanying notice of meeting, including the election of four
directors.
Who
is entitled to vote?
All
shareholders of record of SAVB’s common stock at the close of business on March
5, 2010, which is referred to as the record date, are entitled to receive notice
of the annual meeting and to vote the shares of common stock held by them on the
record date. Each outstanding share of common stock entitles its holder to
cast one vote for each matter to be voted upon.
How
do I vote?
If you
hold your shares of common stock in your own name as a holder of record, you may
vote in person at the annual meeting or instruct the proxy holders named in the
enclosed proxy card to vote your shares as you direct by marking, signing,
dating and returning the proxy card in the postage-paid envelope that we have
provided.
If your
shares of common stock are held by a broker, bank or other nominee (i.e., in
“street name”), you will receive instructions from your nominee which you must
follow in order to have your shares voted.
Proxies
that are signed, but which do not contain specific instructions, will be voted
“FOR” the proposals specified herein.
What
are the quorum and voting requirements to approve the proposals?
The
presence, in person or by proxy, of holders of at least a majority of the total
number of outstanding shares of common stock entitled to vote is necessary to
constitute a quorum for the transaction of business at the annual meeting.
As of the record date, there were 5,938,632 shares of common stock outstanding
and entitled to vote at the annual meeting.
The
required vote for each item of business at the annual meeting is as
follows:
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For
Item 1 on the proxy card, the election of directors, those nominees
receiving the greatest number of votes at the annual meeting, assuming a
quorum is present, shall be deemed elected, even though the nominees may
not receive a majority of the votes
cast.
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For
any other business at the annual meeting, the vote of a majority of the
shares voted on the matter, assuming a quorum is present, shall be the act
of the shareholders on that matter, unless the vote of a greater number is
required by law.
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How
are votes counted?
Under
certain circumstances, including the election of directors, banks and brokers
are prohibited from exercising discretionary authority for beneficial owners who
have not provided voting instructions to the broker (a “broker
non-vote”). In these cases, and in cases where the shareholder
abstains from voting on a matter, those shares will be counted for the purpose
of determining if a quorum is present, but will not be included as votes cast
with respect to those matters. Whether a bank or broker has authority
to vote its shares on uninstructed matters is determined by stock exchange
rules. We expect brokers will be allowed to exercise discretionary
authority for beneficial owners who have not provided voting instructions with
respect to all of the proposals to be voted on at the Annual Meeting other than
Proposal 1 — Election of Directors.
In
counting the votes cast, only those cast “for” and “against” a matter are
included, although you cannot vote “against” a nominee for director.
Directors are elected by a plurality of the votes cast in favor; instructions to
“withhold authority” to vote for a certain nominee will have no
effect.
If you
hold your shares of common stock in your own name as a holder of record and you
fail to vote your shares, either in person or by proxy, the votes represented by
your shares will be excluded entirely from the vote and will have no effect
(other than with respect to establishing a quorum). If, however, your
shares are held in “street name” and you fail to give instructions as to how you
want your shares voted, the broker, bank or other nominee may vote the shares in
their own discretion on certain routine matters.
Will
other matters be voted on at the annual meeting?
We are
not aware of any other matters to be presented at the annual meeting other than
those described in this proxy statement. If any other matters not
described in the proxy statement are properly presented at the meeting, proxies
will be voted in accordance with the best judgment of the proxy
holders.
Can
I revoke my proxy instructions?
You may
revoke your proxy at any time before it has been exercised by:
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filing
a written revocation with the Secretary of SAVB at the following address:
P.O. Box 188, Savannah,
Georgia 31402
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filing
a duly executed proxy bearing a later date;
or
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appearing in person and voting by
ballot at the annual
meeting.
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Any
shareholder of record as of the record date who attends the annual meeting may
vote in person, whether or not a proxy has been previously
given. However, the presence (without further action) of a
shareholder at the annual meeting will not constitute revocation of a previously
given proxy.
What
other information should I review before voting?
The 2009
Annual Report to Shareholders for the fiscal year ended December 31, 2009,
is included with this proxy statement. The annual report is not part
of the proxy solicitation material. The 2009 annual report on Form 10-K
filed with the Securities and Exchange Commission (“SEC”) on March 16, 2010,
including financial statements may be obtained without charge by:
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accessing
SAVB’s web site at
www.savb.com
;
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writing
to the Secretary of SAVB at the following address:
25 Bull Street
,
P.O. Box 188, Savannah,
Georgia 31402
; or
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accessing
the EDGAR database at the SEC’s website at
www.sec.gov
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When
will voting results be available?
You can
find the preliminary voting results of the Annual Meeting in the Company’s
Current Report on Form 8-K, which will be filed with the SEC no later than
April 23, 2010.
PROXY
STATEMENT
PROPOSAL
I
ELECTION
OF DIRECTORS
The Board
of Directors of the Company currently consists of fifteen members, twelve of
whom meet the independence standards of Rule 4200(a)(15) of the National
Association of Securities Dealers. The non-independent directors are President
and Chief Executive Officer John C. Helmken II, Vice Chairman E. James Burnsed
and Russell W. Carpenter, Chief Executive Officer of Minis & Co., Inc.
(“Minis”). The Board of the Company is divided into three Classes
with the terms of office of each Class ending in successive
years. The terms of five Directors of Class II expire at this Annual
Meeting. All directors in Class II are standing for re-election,
except for E. James Burnsed who has reached the maximum retirement
age. Six directors in Class I and four directors in Class III will
continue in office. The shareholders are being asked to vote on the
re-election of four Directors in Class II.
The
shares represented by the enclosed Proxy will be voted for the election of the
four nominees whose names appear below. In the event that any nominee
is unable to serve (which is not anticipated), the Proxies will cast votes for
the remaining nominees and for such other persons as the Board of Directors may
select. A plurality of the votes cast by the shares of Common Stock
represented at the Annual Meeting, at which a quorum must be present, is
required for the election of the Directors listed as well as for the approval of
all other proposals to be acted upon at the Annual
Meeting. Cumulative voting for Directors is not
permitted.
The Board of Directors unanimously
recommends a vote FOR the election of the four
nominees listed
below.
The
following table sets forth the name of each Nominee Director and each Director
continuing in office; a description of his or her positions and offices with the
Company (other than as a Director), if any; a brief description of his or her
principal occupation and business experience during at least the last five
years; directorships presently held by him or her in other companies with
registered securities; and certain other information including his or her age
and the number of shares of Common Stock beneficially owned as of February 28,
2010. For information concerning membership of committees of the
Board and other information, see "Proposal I: Election of Directors -
Information about the Board of Directors and Certain Committees."
All
reports required pursuant to the insider trading regulations were filed timely
in 2009.
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Name,
Age and Year First
Elected
as a Director
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Information
About Nominee or Director
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Amount
and
Nature
of Beneficial
Ownership
*
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%
of
Class
*
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NOMINEES
FOR RE-ELECTION
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Class
II
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Term
Expiring Annual Meeting 2013
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Russell
W. Carpenter (69)
1989
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Mr.
Carpenter is the CEO of Minis & Co., Inc.,
an
investment advisory firm in Savannah,
Georgia,
which is a wholly-owned subsidiary of the Company. Mr.
Carpenter has been with Minis since 1972.
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85,309
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(1)
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1.44
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Clifford
H. Dales (51)
2006
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Mr.
Dales has served as a partner of Colliers Neely Dales, LLC (formerly
Neely/Dales Real Estate Company) since 1997.
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10,913
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(2)
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0.18
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J.
Wiley Ellis (69)
1989
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Mr.
Ellis is Chairman of the Board of
Directors
of the Company and The Savannah Bank, N.A. and serves as general
counsel. He is also a Director of Bryan Bank & Trust and
Minis & Co., Inc. He has been a partner in the law firm of Ellis,
Painter, Ratterree & Adams, LLP since March 1, 1996.
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65,248
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(3)
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1.10
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Aaron
M. Levy (69)
1989
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Mr.
Levy is Executive Chairman of Levy Jewelers, Inc., a chain of jewelry
stores in Savannah, Georgia. Mr. Levy has been employed by Levy
Jewelers since 1962.
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55,318
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(4)
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0.93
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(continued)
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Name,
Age and Year First
Elected
as a Director
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Information
About Directors
Continuing
in Office
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Amount
and
Nature
of
Beneficial Ownership *
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%
of
Class
*
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DIRECTORS
CONTINUING IN OFFICE
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Class
III
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Term
Expiring Annual Meeting 2011
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Francis
A. Brown (58)
2008
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Mr.
Brown has served as Vice President-Finance of the Colonial Group, Inc. (a
large petroleum marketing company headquartered in Savannah, Georgia)
since 1990. Prior to that he was a Partner with Price
Waterhouse LLP and the predecessor Spillane, Rhoads, Lebey & Sieg from
1982 to 1990.
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15,034
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(5)
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0.25
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L.
Carlton Gill (69)
1998
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Mr.
Gill is retired from S. A. Allen, Inc. where he was a procurement forester
since 1964.
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114,991
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(6)
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1.94
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John
C. Helmken II (46)
2004
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Mr.
Helmken became President of the Company effective April 29, 2004 and Chief
Executive Officer effective December 1, 2006. He has served as
CEO of The Savannah Bank, N.A. since January 2003, President from 2002 to
2008, Executive Vice President in 2001 and Senior Vice President from 1997
to 2000.
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95,038
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(7)
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1.58
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Robert
T. Thompson, Jr. (69)
1998
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Mr.
Thompson is retired from CSX Incorporated, a railroad company, where he
was employed since 1962.
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85,770
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(8)
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1.44
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(continued)
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Name,
Age and Year First
Elected
as a Director
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Information
About Directors
Continuing
in Office
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Amount
and
Nature
of Beneficial
Ownership
*
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%
of
Class
*
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Class
I
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Term
Expiring Annual Meeting 2012
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Robert
H. Demere, Jr. (61)
1989
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Mr.
Demere is President of Colonial Group,
Inc.,
a petroleum marketing company in
Savannah,
Georgia. Mr. Demere has been employed by Colonial since
1974.
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99,635
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(9)
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1.68
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Berryman
W. Edwards, Jr. (68)
2006
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Mr.
Edwards is retired from The Greenery, Inc., a commercial and residential
landscaping company in Hilton Head Island, SC. HHe served as
owner and President since 1973.
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6,607
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(10)
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0.11
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J.
Curtis Lewis III (57)
1989
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Mr.
Lewis is Secretary of the Company and The Savannah Bank,
N.A. Mr. Lewis has served as President of Lewis Broadcasting
Corporation since September 2005. Mr. Lewis has been a partner
in the law firm of Hunter & Lewis, LLP in Savannah, Georgia since
1980.
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140,203
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(11)
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2.36
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M.
Lane Morrison (64)
1989
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Mr.
Morrison is retired. He was previously a partner in the law
firm of Hunter, Maclean, Exley & Dunn, PC, Savannah, Georgia since
1995.
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78,650
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(12)
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1.32
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James
Toby Roberts, Sr. (65)
1998
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Mr.
Roberts is President and owner of Roberts Truck Center, Savannah, Georgia
since 1969.
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103,100
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(13)
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1.74
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James
W. Royal, Sr. (61)
1998
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Mr.
Royal is President of Royal Brothers, Inc., a company engaged in the
retail hardware business under the name of Royal Ace Hardware since
1980.
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79,452
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(14)
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1.34
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All
Directors and executive officers as a group (18)
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1,165,307
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(15)
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19.06
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*
Information relating to beneficial ownership by Directors is based upon
information furnished by each Director as of the date stated using “beneficial
ownership” concepts set forth in rules promulgated by the SEC under Section
13(d) of the Securities Exchange Act of 1934. If not footnoted, the
shares are owned with voting and dispositive rights. The percent of
class is calculated on the assumption that a person's exercisable options have
been exercised and that the total number of issued and outstanding shares of the
Company has been increased correspondingly.
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(1)
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Carpenter
- Of the 85,309 shares beneficially owned by Mr. Carpenter, 82,942 shares
are owned individually and 2,367 are stock
options.
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(2)
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Dales
- Of the 10,913 shares beneficially owned by Mr. Dales, 4,222 are owned
individually, 3,671 are in his IRA and 3,020 are stock
options.
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(3)
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Ellis
- Of the 65,248 shares beneficially owned by Mr. Ellis, 14,698 shares are
owned individually, 32,383 shares are in his IRA, 7,796 shares are in a
trust, 1,896 are in his 401K, 171 are in his wife’s IRA and 8,304 are
stock options.
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(4)
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Levy
- Of the 55,318 shares owned by Mr. Levy, 41,015 are owned individually,
12,305 are owned by his wife and 1,998 are stock options.
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(5)
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Brown
- Of the 15,034 shares beneficially owned by Mr. Brown, 14,550 are owned
individually and 484 are stock
options.
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(6)
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Gill
- Of the 114,991 shares beneficially owned by Mr. Gill, 104,878 shares are
owned jointly with his wife, 5,146 shares are in his IRA, 2,788 shares are
in his wife’s IRA and 2,179 are stock
options.
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(7)
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Helmken
- Of the 95,038 shares beneficially owned by Mr. Helmken, 17,589 are owned
individually, 19,687 are in his 401K and 57,762 are stock
options.
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(8)
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Thompson
- Of the 85,770 shares beneficially owned by Mr. Thompson, 67,460 shares
are owned individually, 9,088 shares are in his IRA, 7,332 are in his
wife’s IRA and 1,890 are stock
options.
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(9)
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Demere
- Of the 99,635 shares beneficially owned by Mr. Demere, 88,018 are owned
individually, 3,118 shares are in his IRA, 312 shares are owned by his
wife, 5,296 are owned by immediate family and 2,891 are stock
options.
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(10)
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Edwards
- Of the 6,607 shares beneficially owned by Mr. Edwards, 5,000 are owned
individually and 1,607 are stock
options.
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(11)
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Lewis
- Of the 140,203 shares beneficially owned by Mr. Lewis, 74,949 shares are
owned individually, 18,430 shares are in his IRA and money purchase
retirement plan, 42,181 shares are owned by immediate family and 4,643 are
stock options.
|
|
(12)
|
Morrison
- Of the 78,650 shares beneficially owned by Mr. Morrison, 19,832 are
owned individually, 11,796 shares are in his IRA, 20,275 are owned by his
wife, 24,954 shares are in trusts for his benefit and 1,793 are stock
options.
|
|
(13)
|
Roberts
- Of the 103,100 shares beneficially owned by Mr. Roberts, 74,578 shares
are owned individually, 12,400 shares are in his IRA, 7,362 shares are
owned by immediate family, 1,512 shares are held in a trust, 4,582 are in
his 401K and 2,666 are stock
options.
|
|
(14)
|
Royal
- Of the 79,452 shares beneficially owned by Mr. Royal, 71,128 shares are
owned individually, 5,226 are in his IRAs and 3,098 are stock
options.
|
|
(15)
|
Non-director
ownership - The total shares include additional shares beneficially owned
by four Executive Officers who are not
directors.
|
Directors
Compensation
As of
April 1, 2009, the directors’ fees were reduced. Directors are paid a
retainer of $600 per quarter plus $350 for each special board meeting or
committee meeting attended. The Chairman of the Board receives $2,000
per month plus the retainer and committee attendance fees. The
Secretary receives $750 per month plus the retainer and committee attendance
fees. Committee chairmen are paid $500 per meeting
attended. The Audit Committee Financial Expert is paid $700 per audit
committee meeting attended. Except for Russell W. Carpenter,
directors who are officers of the Company are not separately compensated as
directors.
Subsidiary
bank directors are paid a retainer of $400 per month plus $200 for each special
board meeting or committee meeting attended. Except for Russell W.
Carpenter, directors who are Company or subsidiary bank officers are not
separately compensated as directors. No directors of Minis are
separately compensated as directors of Minis.
Director
compensation is determined based upon compensation received by directors of
similarly sized financial services companies and banks.
All
director compensation is discussed with management and approved by the full
Board. In 2009 directors’ fees were reduced by approximately 10
percent.
Directors
and certain key officers of the Company and subsidiary banks have the
opportunity to participate in The Savannah Bancorp, Inc. Deferred Stock Plan
(“Deferred Stock Plan”). See the narrative explanation provided with
the Nonqualified Deferred Compensation table provided on page 20
hereof.
Non-management
Company and subsidiary bank directors are eligible to receive non-qualified
stock options under The Savannah Bancorp, Inc. 2005 Omnibus Stock Ownership and
Long-Term Incentive Plan (“2005 Omnibus Plan”). Option awards are
recommended by the Compensation Committee, subject to Board
approval. The Compensation Committee is currently using a
discretionary formula whereby the number of non-qualified options awarded is
determined by dividing the fair market value of the Company’s common stock into
a portion of the total director compensation paid in the prior calendar year,
ranging from 0% to 100%, as determined by the Compensation
Committee. In 2009, 47.8% of the 2008 total director cash
compensation was used in calculating the option awards.
Directors
are typically granted non-qualified stock options following the annual
shareholders meeting; therefore, option awards based upon director’s 2009
compensation have not yet been awarded. The 2005 Omnibus Plan was
amended in 2006 so that non-qualified stock options granted to directors vest
25% at grant date and 25% at the beginning of each calendar quarter from the
date of grant.
During 2009, 19,291
options, with an exercise price of $8.74, were granted to non-management
directors.
More information on the Company’s Plan can be found
with the Company’s 2005 Proxy Statement dated March 22, 2005 and filed on March
25, 2005 which contains a full copy of the Plan as Appendix A.
2009
Director Compensation Table
|
Directors
(1)
|
Fees
Earned
or
Paid in
Cash
|
Option
Awards
(2)
|
Non-Qualified
Deferred
Compensation
Earnings
(3)
|
All
Other
Compensation
|
Total
|
|
Francis
A. Brown
|
$ 12,200
|
$ 905
|
$ -
|
$ -
|
$ 13,105
|
|
Russell
W. Carpenter
|
-
|
1,502
|
12,300
|
-
|
13,802
|
|
Clifford
H. Dales
|
18,300
|
2,509
|
-
|
-
|
20,809
|
|
Robert
H. Demere, Jr.
|
-
|
1,870
|
17,550
|
-
|
19,420
|
|
Berryman
W. Edwards
|
-
|
1,610
|
10,300
|
-
|
11,910
|
|
J.
Wiley Ellis
|
52,950
|
6,255
|
-
|
-
|
59,205
|
|
L.
Carton Gill
|
12,150
|
1,442
|
-
|
-
|
13,592
|
|
Aaron
M. Levy
|
-
|
1,313
|
9,350
|
-
|
10,663
|
|
J.
Curtis Lewis III
|
-
|
3,179
|
28,900
|
-
|
32,079
|
|
M.
Lane Morrison
|
10,750
|
1,200
|
-
|
-
|
11,950
|
|
J.
Toby Roberts, Sr.
|
14,500
|
1,885
|
-
|
-
|
16,385
|
|
James
M. Royal, Sr.
|
-
|
2,115
|
20,550
|
-
|
22,665
|
|
Robert
T. Thompson, Jr.
|
11,850
|
1,215
|
-
|
-
|
13,065
|
|
Total
(13 directors)
|
$
132,700
|
$
27,000
|
$
98,950
|
$ -
|
$
258,650
|
|
(1)
|
John
C. Helmken II and E. James Burnsed were executive officers and directors
of the Company in 2009 but received no director compensation and are not
included in the table.
|
|
(2)
|
Non-qualified
options are granted to directors at the discretion of the Compensation
Committee. The Compensation Committee currently utilizes a performance
formula that calculates a percentage which is applied to the each
director’s fees earned in the prior year. The calculated amount
is divided by the closing market price of the shares on the day of the
Annual Meeting to determine the number of option shares that are granted
to each director. The value of the options granted in 2009 was
determined using the Black-Sholes valuation calculation of $1.87 per
option times the number of options
granted.
|
|
(3)
|
Directors
have the option of participating in the Deferred Stock Plan through which
a portion or all of a director’s cash compensation can be
deferred. The Company has elected to contribute the deferrals
to a trust which is discussed under the section entitled Nonqualified
Deferred Compensation beginning on page 20. Each director is
credited with a number of shares at each deferral period and has an
unsecured claim against the Company for the cumulative number of shares
purchased. The amounts shown include the amounts deferred and
the dividends on the shares that were credited to each participating
director’s account.
|
Management
Stock Ownership
As of
February 28, 2010, based on available information, all Directors and executive
officers of the Company as a group (18 persons) beneficially owned 1,165,307
shares of Common Stock, which represented approximately 19.06 percent of the
outstanding shares and exercisable options at that date. The
Directors and executive officers have voting power for 1,480,514 shares, or
24.93 percent of the 5,938,632 shares outstanding. The foregoing
figure includes, in some instances, shares in which members of a Director's or
officer's immediate family have a beneficial interest by reason of shared voting
or investment power and as to which the Director or officer may disclaim
beneficial ownership. 135,588 shares have been pledged as security by
the Directors and executive officers.
PROPOSAL
II
RATIFICATION
OF THE INDEPENDENT REGISTERED PUBLIC ACCOUNTANTS
The Board
of Directors proposes and recommends that the shareholders approve the selection
by the Audit Committee of the firm of Mauldin & Jenkins, LLC to serve as the
independent registered public accounting firm for the Company and the Banks for
the year ending December 31, 2010. A representative of Mauldin &
Jenkins, LLC will be present at the Annual Meeting to make such comments as they
desire and to respond to questions from shareholders of the
Company. Action by the shareholders is not required by law in the
appointment of an independent registered public accounting firm, but their
appointment is submitted by the Board of Directors in order to give the
shareholders a voice in the designation of auditors. If the Audit
Committee’s selection of Mauldin & Jenkins, LLC as the Company’s independent
registered public accounting firm is not ratified by the shareholders, then the
Audit Committee will reconsider its choice of independent
auditors. Even if the selection of Mauldin & Jenkins, LLC is
approved, the Board, in its discretion, may direct the appointment of different
independent auditors at any time during the year if it determines that such a
change would be in the best interests of the Company and its
shareholders.
The
Board of Directors unanimously recommends a vote FOR the ratification of the
selection by the Audit Committee of Mauldin & Jenkins, LLC as independent
registered public accountants to audit the Company’s consolidated financial
statements for the calendar year 2010.
INFORMATION
ABOUT THE BOARD OF DIRECTORS AND CERTAIN COMMITTEES
The Board
of Directors of the Company held five regular meetings during
2009. All incumbent Directors attended at least 75 percent of the
meetings except for Burnsed and Carpenter.
Annual Meeting of
Shareholders.
Directors are encouraged to attend the annual
meeting of shareholders. 13 directors attended the last meeting held
on April 23, 2009.
Executive
Committee.
The Executive Committee of the Board is composed of
six outside directors and one non-independent director, Russell W.
Carpenter. Regular Executive Committee meetings are held during each
of the remaining seven months when the five regular Board meetings are not
held. Called Executive Committee meetings are held as
needed. Directors J. Wiley Ellis, Chairman, Russell W. Carpenter,
Robert H. Demere, Jr., Berryman W. Edwards, Jr., J. Curtis Lewis III, J. Toby
Roberts, Sr. and James W. Royal, Sr. currently serve on this
Committee. Directors Helmken and Burnsed served as ex officio members
of the Executive Committee in 2009. The committee held seven meetings
during 2009. All members attended at least 75 percent of the
Executive Committee meetings during 2009 except for Edwards.
Audit
Committee.
The Audit Committee serves as a liaison between the
Board of Directors and the Company’s independent auditors. The
Committee approves the overall scope of the audit, reviews the results of the
audit and reviews the systems of internal control of the Company. The
Committee operates under a written charter adopted by the Board. This
charter is posted on the corporate website at
www.savb.com
. During
the fiscal year ended December 31, 2009, the Audit Committee met five
times. The Committee is currently composed of Directors Francis A.
Brown, Chairman, Robert H. Demere, Jr., L. Carlton Gill, J. Curtis Lewis III and
Robert T. Thompson, Jr. Director Lewis served as chairman in
2009.
All
directors attended at least 75 percent of the Audit Committee meetings during
2009. Francis A. Brown is recognized as the “Audit Committee
Financial Expert” as defined by the SEC. The formal report of the
Audit Committee with respect to the year 2009 begins on page 13
hereof.
Compensation
Committee.
The Compensation Committee reviews and approves the
compensation of executive officers, reviews and recommends to the Board
incentive and benefit plans, reviews general compensation and benefits policies
and reviews and recommends to the Board the compensation of Company and
subsidiary bank directors. While the Company has not adopted a
written charter for the Compensation Committee, the policies and procedures for
determining compensation for executive officers are included in the Compensation
Discussion and Analysis. The Compensation Committee may not delegate
its authority without approval of the Board. The Board does not allow
executive officers to determine the amount or form of director or executive
compensation. However, the President and Chief Executive Officer make
recommendations for the compensation of directors and executive
officers. The current members of the Compensation Committee are
Directors James W. Royal, Sr., Chairman, Clifford H. Dales, J. Wiley Ellis and
J. Curtis Lewis III, all of whom meet the independence standards of Rule
4200(a)(15) of the National Association of Securities Dealers listing
standards. Three meetings were held in 2009 with all members
attending 100 percent of the meetings. The formal report of the
Compensation Committee with respect to the year 2009 begins on page 14
hereof.
Director Nominating
Committee.
The Director Nominating Committee seeks to identify
individuals qualified to become Directors, recommends candidates for nomination
as Directors to the Board and evaluates candidates recommended for nomination as
Directors by shareholders. The committee operates under a written
charter approved by the Board of Directors. This charter is posted on
the corporate website at
www.savb.com
. The
committee is currently composed of Directors James Toby Roberts, Sr., Chairman,
Francis A. Brown and Aaron M. Levy, all of whom meet the independence standards
of Rule 4200(a)(15) of the National Association of Securities Dealers listing
standards. The Nominating Committee met one time in 2009 and all
members were present. The formal report of the Nominating Committee
with respect to the year 2009 begins on page 14 hereof.
Shareholders
may communicate directly to the Board of Directors in writing by sending a
letter to the Board at the following address: The Savannah Bancorp, Inc,, Attn:
Secretary, 25 Bull Street, Savannah, GA 31401 or by a secure e-mail
via the Company’s website at
www.savb.com
. All
communications directed to the Board will be received and processed by the
Secretary of the Company and will be transmitted to the Chairman of the Board
without any editing or screening by the Secretary of the Company.
Report
of the Audit Committee
The
following Report of the Audit Committee does not constitute soliciting material
and should not be deemed filed or incorporated by reference into any other
Company filing under the Securities Act of 1933 or the Securities Exchange Act
of 1934, except to the extent the Company specifically incorporates this Report
by reference therein.
The Audit
Committee oversees the Company’s financial reporting process on behalf of the
Board. Management has primary responsibility for the financial
statements and the reporting process including the system of internal
control. In fulfilling its oversight responsibilities, the Committee
reviewed and discussed the audited financial statements in the Annual Report
with management, including a discussion of the quality, not just the
acceptability, of accounting principles, the reasonableness of significant
judgments, and the clarity of disclosures in the financial
statements.
The
Committee reviewed and discussed with the independent auditors, who are
responsible for expressing an opinion on conformity of the audited financial
statements with accounting principles generally accepted in the United States of
America, their judgments as to the quality, not just the acceptability, of the
Company’s accounting principles and such other matters as are required to be
discussed by the independent auditors with the Committee in accordance with the
auditing standards of the Public Company Accounting Oversight Board (United
States), including those described in Statement on Auditing Standards No. 61 and
90, as amended. In addition, the Committee has discussed with the
independent auditors the auditors’ independence from management and the
Company.
The
Committee discussed with the Company’s internal and independent auditors the
overall scope and plans for their respective audits. The Committee
met with the internal and independent auditors, with and without management
present, to discuss the results of their examinations, their evaluations of the
Company’s system of internal control and the overall quality of the Company’s
financial reporting.
The
Committee reviewed and discussed with management, the independent registered
public accounting firm, and the internal auditors the Company’s documentation,
testing, remediation and retesting of key controls over financial reporting as
required by Section 404 of the Sarbanes Oxley Act of 2002.
Based on
the foregoing materials and discussions, the Audit Committee recommended to the
Board of Directors that the audited financial statements for the year ended
December 31, 2009 be included in the Company's Annual Report on Form 10-K for
the year ended December 31, 2009.
|
Francis
A. Brown, Chairman
Robert
H. Demere, Jr.
|
L.
Carlton Gill
J.
Curtis Lewis III
|
Robert
T. Thompson, Jr.
|
Report
of the Compensation Committee
The
following Report of the Compensation Committee does not constitute soliciting
material and should not be deemed filed or incorporated by reference into any
other Company filing under the Securities Act of 1933 or the Securities Exchange
Act of 1934, except to the extent the Company specifically incorporates this
Report by reference therein.
Decisions
with respect to the compensation of the Company's executive officers are made by
the Compensation Committee. The Compensation Committee has reviewed
and discussed the Compensation Discussion & Analysis (“CD&A”), which
begins on page 15 hereof, as well as the accompanying tables with management of
the Company and, based upon the Committee’s review and discussion with
management of the Company, the Committee recommends that the CD&A be
included in the Company’s Annual Report on Form 10-K and this proxy statement
for the year ended December 31, 2009.
|
James
W. Royal, Sr., Chairman
|
J.
Wiley Ellis
|
|
Clifford
H. Dales
|
J.
Curtis Lewis III
|
Report
of the Director Nominating Committee
The
Director Nominating Committee evaluates and recommends to the Board candidates
for nomination as directors of the Company, including candidates recommended by
the Committee or by shareholders.
The
Committee considered candidates for election and re-election to the Board and
recommended their nomination to the Board. No candidates who are not
presently directors were recommended by shareholders.
The
Company’s Nominating Committee charter sets forth the following criteria for new
directors: independence, proper skills, experience, knowledge,
integrity and judgment; the potential contribution to the diversity of
backgrounds, experience and competencies to the Board as a whole; the ability to
devote sufficient time and effort to the duties of directors; the attained age
of 25; and the ability to meet all the requirements for service as a director of
a national banking association or a bank insured by the Federal Deposit
Insurance Corporation.
The
Committee is empowered to utilize independent advisors to assist in identifying
new candidates. However, the Committee currently believes that the
existing directors and executive management of the Company and its subsidiaries
have significant networks of business contacts that likely will form the
pipeline from which candidates will be identified. Upon identifying a
candidate for serious consideration, one or more members of the Committee would
initially interview such candidate. If a candidate merited further
consideration, the candidate would subsequently interview with all other
Committee members (individually or as a group), meet the Company’s Chief
Executive Officer and other executive officers, and ultimately meet many of the
other directors. The Committee would elicit feedback from all persons
who met the candidate and then determine whether or not to nominate the
candidate.
|
James
Toby Roberts, Sr., Chairman
|
Aaron
M. Levy
|
|
Francis
A. Brown
|
|
Code of Business Conduct and
Ethics.
The Board has adopted a Code of Business Conduct and
Ethics for Directors, Officers and Employees. This code outlines the
key business behaviors and ethical principles that directors, officers and
employees of the company need to understand and follow. This code is
posted on the corporate website at
www.savb.com
.
Information about Named Executive
Officers Who Are Not Directors.
The following contains certain
information about the Named Executive Officers of the Company who are not
Directors of the Company. A full list of those individuals considered
Named Executive Officers is contained in the Summary Compensation Table provided
as page 18 hereof.
|
Name
and Year First Elected an
Officer of the Company
|
Age
|
Positions
Held and Principal
Occupation Last Five
Years
|
|
|
|
|
|
E.
James Burnsed
1998
|
70
|
Vice
Chairman of the Company since December 1998 and Chairman and CEO of Bryan
Bank & Trust since 1999.
|
|
|
|
|
|
Michael
W. Harden, Jr.
2005
|
39
|
Chief
Financial Officer of the Company
and
The Savannah Bank, N.A. since 2008, Vice President since
2005.
|
|
|
|
|
|
Jerry
O’Dell Keith
2002
|
51
|
President
of Bryan Bank & Trust since 2006, Executive Vice President since 2002
and Vice President of the Company since 2008.
|
|
|
|
|
|
R.
Stephen Stramm
1990
|
60
|
Executive
Vice President - Lending of the
Company
and The Savannah Bank, N.A. since
1990.
|
EXECUTIVE
COMPENSATION AND BENEFITS
Compensation
Discussion and Analysis
The
Compensation Committee is responsible for determining and recommending to the
full Board the compensation of the Corporation's executive officers, including
the Named Executive Officers identified in the Summary Compensation Tables and
other tables on the following pages of this Proxy Statement. The goal
of the Committee is to attract, develop and retain high caliber executives who
are capable of maximizing the Corporation's performance for the benefit of its
shareholders within the Company’s overall philosophy. The Committee
strives to maintain executive compensation that is fair, reasonable, and
consistent with the Corporation's size and the compensation practices of the
financial services industry.
General Compensation
Policies.
The Company has a formal compensation plan designed
to compensate executives for actions deemed to promote long-term shareholder
value. These objectives require that compensation arrangements be
structured to: (1) provide competitive levels of compensation opportunity which
are reflective of the degree of risk inherent in the Company's business plan and
the contributions expected from senior executives; (2) integrate pay with the
Company's business strategies, short-term and long-term performance goals, and
results; (3) reward corporate performance achievements; and (4) recognize and
reward individual initiative, responsibility and achievements. The
Committee believes that stock ownership by management and stock-based
performance compensation arrangements which are tied to performance are
beneficial in aligning management and shareholder interests in the enhancement
of shareholder value. Base salaries and short-term incentive
compensation in the form of cash bonuses, based on individual performance and
the performance of the Company, are approved by the Board, after recommendation
by the Committee. They are intended to reflect individual performance
and responsibility and to represent compensation believed by the Committee to be
appropriate if the Named Executive Officers perform in a fully acceptable
manner.
In
setting base salaries and incentive compensation, consideration is also given to
compensation paid to executives of financial institutions and other public
companies similar in size and character to the Company. This is a subjective
consideration and is not based on specific peer compensation numbers accumulated
either by the Compensation Committee, management or any other third
party. The Committee has established a compensation package
consisting of base salary, short-term incentive compensation in the form of cash
bonuses based on individual performance and the performance of the Company, and
long-term incentive compensation in the form of stock-based
compensation. For 2009, the short-term incentive compensation plan
was suspended for the Named Executive Officers. In addition there
were no long-term stock-based incentive compensation awards in
2009.
Compensation Paid in
2009.
The Company's policy regarding compensation of its Named
Executive Officers is based upon performance in relation to the responsibilities
and accomplishments incident to the individual's job description. In
determining compensation, the Committee considers the progress made by the
Company in laying a foundation for future revenue enhancements, income
improvements, growth, and quality of assets.
Compensation
paid to the Named Executive Officers included in the following compensation
tables for the fiscal year 2009 consisted of the following elements: base
salary, cash incentive compensation, matching contributions paid to the
Company's 401(k) Plan and qualified incentive stock
options. Contributions made by the Company under the 401(k) Plan are
made to all participating employees on a nondiscriminatory basis. The
Company also has certain broad-based employee benefit plans in which the Named
Executive Officers participate. The Named Executive Officers also may
have received perquisites in connection with their
employment. However, such perquisites totaled less than 10 percent of
their cash compensation in 2009. Except for cash incentives and
incentive stock options, the foregoing benefits and compensation are not
directly tied to Company performance. For 2009, the cash incentive
plan was suspended for the Named Executive Officers and there were no incentive
stock option awards.
Base Salary.
The
base salary for each Named Executive Officer is reviewed by the Committee
annually (and/or at the time of promotion). Salary increases
are based upon the Company’s overall performance, the executive officer’s
realization of individual objectives during the preceding calendar year and also
competitive market data. The objectives of the Company’s base salary program are
to provide salaries at a level that permits the Company to attract and retain
qualified executive officers and to recognize and reward individual
performances. Base salary levels also drive other elements of
executive compensation such as the annual cash incentive
compensation. The Committee sets base salary levels based upon
current market data and the executive officer’s experience, scope of
responsibilities, performance and potential.
Cash Incentive Compensation
.
Historically, the Company and the subsidiary banks have incentive compensation
plans under which the Named Executive Officers can earn performance compensation
if the Company achieves certain specified earnings, growth and expense control
objectives as set forth by the Board. Each Named Executive Officer
has a performance matrix approved by the Board containing Company-wide and
subsidiary bank goals as well as individual objectives for certain officers for
the year that form a basis for the calculation of performance compensation under
the Company’s cash incentive plan. While not all Named Executive
Officers have the same goals, Company-wide goals may include increases in
earnings per share, Return on Equity and Overhead Efficiency Ratio; subsidiary
bank goals may include the bank’s core earnings, loan portfolio size and loan
portfolio yield. Each Named Executive Officer may also have project
completion objectives. Actual results will then be measured against
predetermined control and weighting factors to compute the incentive
compensation for each particular goal or objective. The Board may
also approve adjustments to the annual incentive payout. Cash
payments for incentive compensation will typically be made within 45 days of
fiscal year end. Additional information on cash incentive
compensation is provided in the Summary Compensation table below. For
2009, the Company suspended the short-term cash incentive plan.
Stock Options.
The
2005 Omnibus Plan, as amended, was adopted and approved by the shareholders on
April 21, 2005. The 2005 Omnibus Plan authorizes the Board, or a
committee thereof, to grant awards of incentive stock options, non-qualified
stock options, restricted stock, stock appreciation rights or performance units
to key officers and non-management directors of the Company and the subsidiary
banks.
In 2009,
no awards were made from the 2005 Omnibus Plan
to the Named Executive
Officers; however, previously awarded incentive and restricted stock options did
vest in 2009. The Company believes that grants of the awards serve as
effective long term incentive for the Named Executive Officers that encourages
them to remain with the Company and continue to excel in their
performance.
Each
incentive stock option granted permits the Named Executive Officer to purchase a
certain number of shares of Company stock from the Company at the exercise
price, which is the closing price of the Company stock on the date of
grant. Stock options have value only to the extent the price of the
Company stock on the date of exercise exceeds the exercise
price. Stock options granted have a term of ten years and will vest
and become exercisable in five equal annual installments beginning one year
after the grant date. No such options were awarded to any Named
Executive Officers in 2009.
Nonqualified Deferred Compensation
Plan
. Certain key officers of the Company and subsidiary banks
have the opportunity to participate in the Deferred Stock
Plan. Participants may elect to defer up to 25% of base salary into
the Plan annually. The deferred account balances shall at all times
be 100% vested. Participant deferrals are automatically allocated to
Common Stock of the Company. In 2009, Mr. Keith was the only Named
Executive Officer who participated in the Deferred Stock Plan. See
the narrative explanation provided with the Nonqualified Deferred Compensation
table provided on page 20 hereof.
401(k)
Plan
.
The
Company maintains a 401(k) plan for all eligible employees. The
401(k) plan provides for discretionary Company matching contributions to
employee contributions and also provides for an annual discretionary
profit-sharing contribution. The Company contributes 50% of the first
6% of eligible compensation which an employee contributes to the
plan. Contributions may be invested in the Company’s common stock or
in other investments chosen by the participants. The Company’s
discretionary profit-sharing contribution has historically been determined based
on a target of 3% of eligible compensation adjusted by a percentage which
approximates the difference between actual earnings and budgeted earnings at the
direction of the Board. The discretionary contribution for 2009 was
1% of eligible compensation. All Named Executive Officers are
eligible to participate in this plan up to the maximum contribution limits
established by the IRS.
A key
purpose of the above incentive plans is to further the growth in earnings and
market appreciation of the Company by providing both short-term and long-term
incentives to executive officers and directors. The Company intends
that these incentives provided by these plans will help the Company recruit,
retain and motivate its executive officers. More information on the
2005 Omnibus Plan can be found with the Company’s 2005 Proxy Statement dated
March 22, 2005 and filed with the SEC on March 25, 2005 which contains a full
copy of the Plan as Appendix A.
Senior Executive
Compensation.
Mr. Helmken became the President and Chief
Executive Officer of the Company on December 1, 2006. The Board
approved a compensation package for Mr. Helmken for 2009 which included (1)
$250,000 base salary; (2) other standard benefits. The cash incentive
plan was suspended for 2009 for Mr. Helmken. Mr. Helmken did not vest
in 2009 and 2008 in certain stock options under which shares vest over five
years upon achievement of specific performance objectives. Details
regarding the compensation of Mr. Helmken are set forth in the tables that
follow this section.
Summary
Compensation Table
The
following table provides certain summary information concerning the compensation
earned by the Chief Executive Officer, President, Chief Financial Officer and
the other most highly paid executive officers who served in such capacity as of
December 31, 2009. The table provides compensation amounts for
services rendered in all capacities for the 2009 fiscal year. The
individuals listed in the table below are referred to in this Proxy Statement as
the “Named Executive Officers.”
|
Name
and
Principal
Position
|
Year
|
Salary
|
Option
Awards
|
Non-Equity
Incentive
Plan Compensation
(3)
|
All
Other Compensation
(4)
|
Total
|
|
John
C. Helmken II
President
& CEO
|
2009
2008
2007
|
$
250,000
250,000
250,000
|
$ -
-
-
|
$ -
-
10,000
|
$
17,829
21,584
15,978
|
$
267,829
271,584
275,975
|
|
Michael
W. Harden, Jr.
CFO
(1)
|
2009
2008
|
139,000
110,708
|
-
-
|
-
2,438
|
5,764
5,314
|
144,764
118,460
|
|
Robert
B. Briscoe
CFO
(2)
|
2008
2007
|
67,500
135,000
|
-
-
|
-
14,400
|
7,721
10,457
|
75,221
159,857
|
|
R.
Stephen Stramm
EVP-
Lending
|
2009
2008
2007
|
175,000
175,000
157,500
|
-
-
-
|
-
6,563
17,000
|
9,952
12,936
13,815
|
184,952
194,499
188,315
|
|
E.
James Burnsed
Vice
Chairman
|
2009
2008
2007
|
130,000
130,000
130,000
|
-
-
-
|
-
20,320
7,582
|
6,204
13,600
14,322
|
136,204
163,920
151,904
|
|
Jerry
O’Dell Keith
Vice
President
|
2009
2008
2007
|
165,000
165,000
145,000
|
-
-
-
|
-
25,425
12,874
|
10,390
11,040
9,665
|
175,390
201,465
188,958
|
|
(1)
|
Michael
W. Harden, Jr. became Chief Financial Officer effective November 18,
2008. Salary information for 2007 is not provided because he
was not a Named Executive Officer.
|
|
(2)
|
Robert
B. Briscoe resigned as Chief Financial Officer effective May 31,
2008.
|
|
(3)
|
For
2009, the short-term cash incentive plan was
suspended. Historically, each Named Executive Officer has a
performance matrix established by the Board containing Company-wide and
subsidiary bank goals, as well as individual objectives for certain
officers, for the year that form a basis for calculation of performance
compensation under the Company’s Cash Incentive Plan. The Board
may also approve adjustments to the annual incentive
payout. Cash payments for incentive compensation are typically
made within 45 days of fiscal year
end.
|
|
(4)
|
Other
compensation includes amounts contributed to the Employee Savings and
Profit Sharing Plan by the Company, group term life insurance and social
club dues.
|
|
(5)
|
Named
Executive Officers receive no additional compensation for serving as a
director.
|
Grants
of Plan-Based Awards
As
described above, there were no short-term incentives or long-term incentives
awarded to the Named Executive Officers in 2009.
Outstanding
Option
and Stock Awards
The
following table sets forth certain information regarding the outstanding equity
awards to each of the Named Executive Officers as of December 31,
2009. All shares have been restated to reflect the effect of any
stock splits.
|
Name
|
Option
Awards
|
|
Number
of
Securities
Underlying
Unexercised
Options
(#)
Exercisable
|
Number
of
Securities
Underlying
Unexercised
Options
(#) (1)
Unexercisable
|
Equity
Incentive
Plan
Awards:
Numbers
of Securities Underlying Unexercised Unearned
Options
(#) (2)
|
Option
Exercise
Price
($)
|
Option
Expiration
Date
|
|
John
C. Helmken II
President
& CEO
|
7,562
5,672
8,593
4,687
18,748
3,122
|
-
-
-
-
4,689
4,689
|
-
-
-
-
-
4,689
|
9.98
10.23
13.02
15.76
17.85
17.85
|
4/21/10
4/17/11
7/16/12
10/22/13
4/29/14
4/29/14
|
|
Michael
W. Harden, Jr.
CFO
|
500
250
|
-
-
|
-
-
|
0.00
0.00
|
1/1/16
7/17/17
|
|
R.
Stephen Stramm
EVP
- Lending
|
1,718
3,125
2,000
|
-
-
500
|
-
-
-
|
13.02
15.76
22.20
|
7/16/12
10/22/13
2/4/15
|
|
E.
James Burnsed
Vice
Chairman
|
-
|
-
|
-
|
-
|
|
|
Jerry
O’Dell Keith
Vice
President
|
3,906
3,000
1,187
1,250
|
-
750
-
-
|
-
-
-
-
|
15.76
22.20
0.00
0.00
|
10/22/13
2/14/15
1/1/16
7/17/17
|
|
(1)
|
All
shares vest equally over the five years ending five years prior to the
expiration date except for the grants referred to in (2)
below.
|
|
(2)
|
These
options vest over the same period as (1), but contain performance
criteria. They vest only if earning per share growth equals 12%
or more each year. Unvested options will vest at the end of the
five year vesting period if the compounded growth rate for the five years
is 15% or more.
|
Option
Exercises and Stock Vested
There
were no exercises of stock options or stock awards that vested for any of the
Named Executive Officers during the fiscal year ended December 31,
2009.
Nonqualified
Deferred Compensation
Directors
and certain key officers of the Company and Subsidiary Banks have the
opportunity to participate in the Deferred Stock Plan. This plan is a
nonqualified plan within the meaning of Section 401(a) of the Internal Revenue
Code and is unfunded under the Employee Retirement Income Security Act of
1974. Participants may elect to defer up to 100% of director’s fees
or 25% of base salary into the plan annually. The deferred account
balances shall at all times be 100% vested.
Participant
deferrals are automatically allocated to Common Stock of the
Company. Any stock or cash dividends payable on such stock are
credited to the participant’s account in the form of additional
shares. The Participants do not have any rights in the stock held by
the Deferred Stock Plan until withdrawals from their respective accounts are
made and at all times remain unsecured creditors of the Company.
Participants
shall receive 100% of their deferred account balance in the form of Company
Common Stock upon death, disability, retirement or termination of employment or
service as a director. Participants may also receive 100% of their
deferred account balance upon a change in control of the
Company. Participants pay ordinary income taxes on the market value
of withdrawals from the Plan. The Company receives an income tax
deduction for an equal amount at the time of distribution.
The
Company has elected to contribute all Participant deferrals into The Trust Under
the Savannah Bancorp, Inc. Deferred Stock Plan (“Trust”) which qualifies as a
“Rabbi” trust for the purpose of supporting nonqualified benefit
obligations. Participant deferrals are invested in Company common
stock which is purchased by the Trust on the open market at the time of
deferral. The creation of this Trust is intended to help ensure that
Company common stock is available for Participant distributions at the time of a
withdrawal.
The
following table provides certain information regarding Nonqualified Deferred
Compensation during the fiscal year ended December 31, 2009 for the Named
Executive Officers that participate in the Deferred Stock Plan.
|
Name
|
Executive
Contributions
in
2009
|
Registrant
Contributions
in
2009
|
Aggregate
Earnings
in
2009
|
Aggregate
Withdrawals/
Distributions
|
Aggregate
Balance
at
December
31,
2009
|
|
Jerry
O’Dell Keith
|
$
4,124
|
$ -
|
$
128
|
$ -
|
$
8,438
|
Employment
Agreements
The
Company has entered into change in control agreements with certain of the Named
Executive Officers. Each of said agreements provides that the
executive shall continue to receive from the Company the same level of
compensation for a period of one year after termination if, following a "change
in control", the executive is terminated without cause during the one-year
period immediately following a "change in control". In addition, each
agreement provides that the executive may voluntarily terminate employment
during the one-year period following a “change in control” and will continue to
receive the same level of compensation for the remainder of the one-year
period. A "change in control" is defined as the sale of all or a
substantial portion of the Company's assets, a merger or other reorganization
whereby the Company is not the surviving entity or a change in control as
defined by the Office of the Comptroller of the Currency.
Below is
a summary of the approximate amounts that could have been paid to the Named
Executive Officers had the change in control provision been triggered as of
December 31, 2009.
|
Name
|
Compensation
(1)
|
|
John
C. Helmken II, President & CEO
|
$
250,000
|
|
R.
Stephen Stramm, Executive VP - Lending
|
175,000
|
|
E.
James Burnsed, Vice Chairman
|
130,000
|
|
Jerry
O’Dell Keith, Vice President
|
165,000
|
|
(1)
See Summary Compensation Table for material components of
compensation.
|
The
Company has not entered into any other agreements or arrangements with the Named
Executive Officers
regarding resignation,
termination, severance or retirement.
Ownership
of Equity Securities
As of
March 5, 2010, the Company’s records and other information from outside sources
indicated there were no beneficial owners of more than five percent of the
outstanding shares of the Company’s common stock.
Other
Matters
Certain
Transactions
The
Company’s Subsidiary Banks have granted loans to certain Directors of the
Company and the Banks and to their related interests. The aggregate
amounts of loans were $37,933,000 and $31,325,000 at December 31, 2009 and 2008,
respectively. During 2009, $16,292,000 of new loans were made and
repayments of $9,484,000 were received. Also, related party loan
totals decreased by an additional $200,000 during 2009 due to changes in related
party status. Unfunded commitments of credit available to related
parties aggregated $2,515,000 and $4,295,000 at December 31, 2009 and 2008,
respectively. Related party loans are made on substantially the same
terms, including interest rates and collateral, as those prevailing at the time
for comparable transactions with unrelated persons and do not involve more than
normal risk of collection. There are no family relationships between
directors and/or executive officers of the Company.
Loans to
directors and executive officers must be approved by the Board of Directors of
the subsidiary bank making such a loan under the provisions of Federal Reserve
Regulation O. The borrower is not permitted to be present during
discussion of the loan nor allowed to vote on such loan. All
decisions regarding loans are documented in the minutes of the appropriate
subsidiary bank to comply with the rules and regulations of the applicable
regulatory authorities of the subsidiary banks.
The
Company also has a note payable due to certain companies related to Directors of
$15,988,000. The interest is at prime plus two percent with a floor
of 7.5 percent. The agreement includes customary performance
covenants and a guarantee of the Company. The Company also leases two
branches from an entity related to one Director. The leases are at
market rates with similar terms as those prevailing at the time for comparable
transactions with unrelated persons.
Proxy
Solicitation
The
Company will pay the cost of soliciting Proxies for the Annual
Meeting. In addition to solicitation of shareholders of record by
mail, telephone or personal contact, the Company will be contacting brokers,
dealers, banks or voting trustees or their nominees who can be identified as
record holders of Common Stock. Such holders, after inquiry by the
Company, will provide information concerning quantities of Proxy materials and
Annual Reports needed to supply such information to beneficial owners, and the
Company will reimburse them for the expense of mailing Proxy materials and 2009
Annual Reports to such owners.
Principal
Accountant Fees and Services
Mauldin
& Jenkins, LLC (“M&J”), the Company’s principal accountant, billed for
services rendered as shown in the following table:
|
Year
|
Audit
services
(1)
|
Audit
related
fees
|
Tax
services
|
Other
|
Total
|
|
2009
|
$
191,000
|
$ -
|
$ -
|
$ -
|
$
191,000
|
|
2008
|
203,000
|
-
|
-
|
-
|
203,000
|
|
(1)
|
Audit
fees consist of fees for the integrated audit of the Company’s financial
statements, review of the financial statements included in the Company’s
quarterly reports and the audit of the effectiveness of its internal
control over financial reporting.
|
A
representative of M&J is expected to be present at the 2010 shareholders'
meeting. He will have an opportunity to make a statement should he
desire to do so and is expected to be available to respond to appropriate
questions.
The Audit
Committee is responsible for approving all auditing services and permitted
non-audit services to be performed by the independent registered public
accounting firm. The Audit Committee pre-approved all of the above
rendered services.
Shareholder
Proposals and Director Nominations for 2011 Annual Meeting
Proposals
of shareholders and director nominations, accompanied by relevant biographical
information, to be presented at the 2011 Annual Meeting of Shareholders must be
received by the Company on or before January 17, 2011 to be included in the
Proxy Statement and Form of Proxy relating to the 2011 Annual Meeting of
Shareholders. Proposals and director nominees should be directed to
The Savannah Bancorp, Inc., 25 Bull Street, Savannah, Georgia 31401; Attention:
J. Curtis Lewis III, Secretary.
Shareholder
Communications with the Board of Directors
Shareholders
may communicate directly to the Board of Directors in writing by sending a
letter to the Board at:
The Savannah Bancorp,
Inc., 25 Bull Street, Savannah, Georgia 31401; Attention: J. Curtis Lewis III,
Secretary
. All communications directed to the Board will be
received and processed by the Company’s Secretary and will be transmitted to the
Chairman of the Board without any editing or screening.
Miscellaneous
The
management of the Company knows of no other matters that are to be presented for
action at the Annual Meeting. If any other matters are brought
properly before the
Annual Meeting, the
persons designated in the enclosed Proxy will vote on such matters in accordance
with their best judgment.
Upon
the written request of any person whose Proxy is solicited by this Proxy
Statement, the Company will furnish to such person without charge (other than
for exhibits), a copy of the Company's Annual Report on Form 10-K for the fiscal
year ended December 31, 2009, including financial statements and schedules
thereto, as filed with the SEC. Requests should be directed to The
Savannah Bancorp, Inc., P.O. Box 188, Savannah, Georgia 31402, Attention:
Michael W. Harden, Jr., Chief Financial Officer. The Form 10-K is
also available for immediate retrieval on the Internet from our web site,
www.savb.com
.
Front
of proxy card
THE
SAVANNAH BANCORP, INC.
PROXY
SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
FOR
ANNUAL SHAREHOLDERS MEETING ON APRIL 21, 2010
The undersigned hereby appoints
Thornton Barrow and Andy Thompson, and any of them, with full power of
substitution, as proxies to vote the Common Stock of The Savannah Bancorp, Inc.
held by the undersigned at the above stated Annual Meeting to be held at the
Hyatt Regency Savannah, Two West Bay Street, Savannah, Georgia on April 21,
2010, at 11:00 a.m., Eastern Daylight Time, and any adjournments thereof, and to
vote as follows:
PROPOSAL
I. RE-ELECTION OF DIRECTORS
Nominees
for re-election: Russell W. Carpenter, Clifford H. Dales, J. Wiley
Ellis, &
Aaron M.
Levy
__
Vote
FOR
all nominees listed above,
except withhold authority to vote for the
PLEASE RECORD
YOUR
following
nominees (if any):________________________________ OR
VOTE TO THE LEFT
AND
__
Vote
WITHHELD
for all nominees
listed above.
SIGN ON THE OTHER
SIDE
PROPOSAL
II. RATIFICATION OF THE APPOINTMENT OF MAULDIN &
JENKINS, LLC AS INDEPENDENT REGISTERED PUBLIC ACCOUNTANTS FOR THE FISCAL
YEAR 2010.
__ VOTE
FOR __ VOTE
AGAINST __ ABSTAIN
Back of proxy card
PLEASE
SIGN EXACTLY AS NAME APPEARS BELOW AND
CHECK APPROPRIATE BLOCKS ON
THE OTHER SIDE
.
WHEN
PROPERLY EXECUTED THIS PROXY WILL BE VOTED AS DIRECTED HEREIN BY THE UNDERSIGNED
STOCKHOLDER. IF NO DIRECTION IS MADE, THIS PROXY WILL BE VOTED "FOR"
PROPOSAL I AND “FOR” PROPOSAL II. THE PROXIES ARE AUTHORIZED TO
VOTE IN THEIR SOLE DISCRETION ON SUCH OTHER BUSINESS AS MAY COME BEFORE THE
MEETING OR ANY ADJOURNMENTS THEREOF.
______________________________________________
PLACE LABEL HERE
______________________________________________
Signature(s) of
Stockholder
Please
sign exactly as name appears on this proxy. When shares
are held
by joint tenants, both should sign. When signing on
behalf of
a corporation or partnership, or as attorney, agent or
fiduciary, please indicate the capacity
in which you are signing.
Dated:_________________, 2010
PLEASE
SIGN, DATE AND RETURN THIS PROXY CARD IN THE ENCLOSED
ENVELOPE.
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