As filed with the Securities and Exchange Commission on July [ ], 2004
Registration Statement No. 333-___________
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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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Form S-8
REGISTRATION STATEMENT
Under
The Securities Act of 1933
----------------------
Sandy Spring Bancorp, Inc.
(Exact Name of Registrant as Specified in its Charter)
Maryland 52-1532952
(State or Other Jurisdiction of (IRS Employer I.D. Number)
Incorporation or Organization)
17801 Georgia Avenue, Olney, Maryland 20832
(Address of Principal Executive Offices) (Zip Code)
Sandy Spring Bancorp, Inc. Director Stock Purchase Plan
(Full Title of Plan)
Hunter R. Hollar
Sandy Spring Bancorp, Inc.
17801 Georgia Avenue
Olney, Maryland 20832
(301) 774-6400
(Name, Address, and Telephone Number of Agent for Service)
Copy to:
James I. Lundy, III, Esquire
Kennedy, Baris & Lundy, L.L.P.
Suite P-15
4701 Sangamore Road
Bethesda, Maryland 20816
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CALCULATION OF REGISTRATION FEE
--------------------------------------------------------------------------------
Title of Proposed
Securities Amount to be Maximum Proposed Maximum Amount of
to be Registered Offering per Aggregate Offering Registration
Registered (1) Share(1) Price(1) Fee
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Common Stock, 15,000 $34.05 $510,675
$1.00 par value shares $64.70
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(1) Based upon the average of the high and low prices of the Common Stock
reported in the consolidated reporting system on July 9, 2004, in accordance
with Rule 457(c) under the Securities Act of 1933, as amended (the "Securities
Act"), solely for purposes of calculating the registration fee pursuant to Rule
457(h) under the Securities Act.
PART I
INFORMATION REQUIRED IN THE SECTION 10(a) PROSPECTUS
Pursuant to General Instruction C of Form S-8, the information set
forth under the caption "PROSPECTUS" below constitutes a Reoffer Prospectus with
respect to restricted shares of common stock purchased by certain directors
under the Sandy Spring Bancorp, Inc. Directors' Stock Purchase Plan (the "Plan")
prior to the filing of this Registration Statement. The documents and documents
incorporated by reference constituting the prospectus for the registration of
shares of common stock of the Registrant offered to directors of the Registrant
under the Plan are not filed with the Commission, pursuant to the note to Part I
of Form S-8 and Commission Rule 428.
PROSPECTUS
1,120 SHARES
SANDY SPRING BANCORP, INC.
COMMON STOCK
Sandy Spring Bancorp, Inc. is the holding company for Sandy Spring
Bank, a commercial bank headquartered in Olney, Virginia.
Certain members of the board of directors of Sandy Spring Bancorp are
reoffering 1,120 shares of Common Stock that they purchased under our Director
Stock Purchase Plan. Our common stock is quoted on the Nasdaq National Market
under the symbol "SASR". The directors may sell these reoffered shares in public
or privately negotiated transactions or may transfer them by gift or bequest or
otherwise from time to time in the future.
INVESTING IN COMMON STOCK INVOLVES RISKS. SEE "RISK FACTORS" BEGINNING
ON PAGE 1 TO READ ABOUT FACTORS YOU SHOULD CONSIDER BEFORE YOU MAKE YOUR
INVESTMENT DECISION.
The price of the reoffered shares to the public depends upon future
market prices of the common stock that can not yet be determined.
NEITHER THE SECURITIES AND EXCHANGE COMMISSION NOR ANY STATE SECURITIES
COMMISSION HAS APPROVED OR DISAPPROVED OF THESE SECURITIES OR PASSED UPON THE
ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A
CRIMINAL OFFENCE.
THESE SECURITIES ARE NOT DEPOSITS, SAVINGS ACCOUNTS, OR OTHER
OBLIGATIONS OF A DEPOSITORY INSTITUTION AND ARE NOT INSURED BY THE FEDERAL
DEPOSIT INSURANCE CORPORATION OR ANY OTHER GOVERNMENTAL AGENCY.
The date of this prospectus is July 9, 2004.
TABLE OF CONTENTS
Summary........................................................................1
Risk Factors...................................................................1
Caution about Forward Looking Statements.......................................3
Selling Security Holders.......................................................4
Where You Can Find Additional Information about Sandy Spring Bancorp, Inc......4
Documents Incorporated by Reference............................................4
Indemnification of Directors and Officers......................................5
YOU SHOULD RELY ONLY ON THE INFORMATION CONTAINED OR INCORPORATED BY REFERENCE
IN THIS PROSPECTUS. WE HAVE NOT AUTHORIZED ANY OTHER PERSON TO PROVIDE YOU WITH
DIFFERENT INFORMATION. THE SHARES REOFFERED BY THIS PROSPECTUS ARE NOT BEING
OFFERED IN ANY JURISDICTION WHERE THEIR REOFFER OR SALE IS NOT PERMITTED.
SUMMARY
THIS SUMMARY HIGHLIGHTS SELECTED INFORMATION ABOUT US AND THE
REOFFERING. THE SUMMARY DOES NOT CONTAIN ALL OF THE INFORMATION THAT YOU SHOULD
CONSIDER BEFORE INVESTING IN OUR COMMON STOCK .YOU SHOULD READ THIS SUMMARY
TOGETHER WITH THE ENTIRE PROSPECTUS. EXCEPT AS OTHERWISE INDICATED BY THE
CONTEXT, REFERENCES IN THIS PROSPECTUS TO "WE," "OUR," OR "US," ARE TO THE
COMBINED BUSINESS OF SANDY SPRING BANCORP AND ITS SUBSIDIARIES, INCLUDING SANDY
SPRING BANK.
SANDY SPRING BANCORP, INC. Sandy Spring Bancorp, Inc. is the registered bank
holding company for Sandy Spring Bank, headquartered in Olney, Maryland. The
Bank operates thirty community offices in Anne Arundel, Frederick, Howard,
Montgomery, and Prince George's Counties in Maryland, together with an insurance
subsidiary and an equipment leasing company. The address and phone number of our
principal executive offices are 17801 Georgia Avenue Olney, Maryland 20832,
(301) 774-6400.
We offer a broad range of financial services to consumers and
businesses in this market area. We have established a strategy of independence,
and intend to establish or acquire additional offices, banking organizations,
and nonbanking organizations as appropriate opportunities may arise.
THE SANDY SPRING BANCORP, INC. DIRECTORS' STOCK PURCHASE PLAN. Our board of
directors established the Directors' Stock Purchase Plan in December 2003. This
plan provides a convenient means for participating directors to purchase our
common stock at its market value. A total of 15,000 shares of common stock
(approximately 1/10 of one percent of our outstanding shares of common stock)
are authorized for issuance under the plan.
THE REOFFERED SHARES. In May 2004, 1,120 shares of common stock were issued
under the Directors' Stock Purchase Plan. These shares are being reoffered by
means of this prospectus. Before investing, carefully review the information
contained in "Risk Factors," below.
RISK FACTORS
CHANGES IN INTEREST RATES COULD REDUCE OUR PROFITABILITY.
Our ability to make a profit, like that of most financial
institutions, substantially depends upon our net interest income, which is the
difference between the interest income we earn on our interest-earning assets
(such as loans and investment securities) and the interest expense we pay on our
interest-bearing liabilities (such as deposits and borrowings). Certain assets
and liabilities, however, may react in different degrees to changes in market
interest rates. Further, interest rates on some types of assets and liabilities
may fluctuate prior to changes in broader market interest rates, while rates on
other types may lag behind. Additionally, some of our assets, such as
adjustable-rate mortgages, have features, including payment and rate caps, that
restrict changes in their interest rates. Factors such as inflation, recession,
unemployment, money supply, international disorders, instability in domestic and
foreign financial markets, and other factors beyond our control may affect
interest rates. Changes in market interest rates also will affect the level of
voluntary prepayments on our loans and the receipt of payments on our
mortgage-backed securities, resulting in the receipt of proceeds that may be
reinvested at a lower rate than the loan or mortgage-backed security being
prepaid. Increases in market rates could have a significant adverse impact on
our non-interest income as a result of reduced demand for residential mortgage
loans and other loans. Although we pursue an asset-liability management strategy
designed to control our risk from changes in market interest rates, changes in
interest rates can still have a material adverse effect on our profitability.
OUR ALLOWANCE FOR CREDIT LOSSES MAY BE INADEQUATE TO COVER LOSSES ACTUALLY
INCURRED.
We maintain an allowance for credit losses in an amount we believe
is sufficient to provide for risks in our loan portfolio. At any time, there are
loans included in our loan portfolio that may result in losses, but that have
not been identified as nonperforming or potential problem loans. We have
procedures that we use to help us identify potential problem loans at a time
when they can be worked out with minimal loss. However, we cannot be sure that
we will be able to identify deteriorating loans before they become nonperforming
assets, or that we will be able to limit losses on those loans that are
2
identified. If Sandy Spring Bank incurs actual losses on its loans in excess of
its allowance for credit losses, it may have insufficient income to extend
credit, pay dividends or otherwise supply funds to us.
CHANGES IN LOCAL ECONOMIC CONDITIONS COULD REDUCE OUR INCOME AND GROWTH, AND
COULD LEAD TO HIGHER LEVELS OF PROBLEM LOANS AND CHARGE-OFFS.
Our lending operations are concentrated in Montgomery, Howard, Ann
Arundel, Prince George's, and Frederick Counties in Maryland. Adverse changes in
economic conditions in these areas, or the neighboring areas of Washington, D.C.
and its Virginia suburbs or Baltimore, Maryland and its suburbs could hurt our
ability to collect loans, could reduce the demand for loans, and otherwise could
negatively affect our performance and financial condition.
WE COMPETE WITH OTHERS FOR BUSINESS.
We compete for loans, deposits, and investment dollars with other
banks and other kinds of financial institutions and enterprises, such as
securities firms, insurance companies, savings and loan associations, credit
unions, mortgage brokers, and private lenders, many of which have substantially
greater resources than ours. In addition, non-depository institution competitors
are generally not subject to the extensive regulation applicable to us and Sandy
Spring National Bank. The differences in resources and regulation may make it
harder for us to compete profitably, reduce the rates that we can earn on loans
and investments, increase the rates we must offer on deposits and other funds,
and adversely affect our financial condition and earnings.
GOVERNMENT REGULATION SIGNIFICANTLY AFFECTS OUR BUSINESS.
The banking industry is heavily regulated. Banking regulations are
primarily intended to protect the federal deposit insurance funds and
depositors, not shareholders. Sandy Spring National Bank is subject to
regulation and supervision by the Office of the Comptroller of the Currency. We
are subject to regulation and supervision by the Board of Governors of the
Federal Reserve System. The burden imposed by federal and state regulations puts
banks and bank holding companies at a competitive disadvantage compared to less
regulated competitors such as finance companies, mortgage banking companies and
leasing companies. Changes in the laws, regulations, and regulatory practices
affecting the banking industry could impose additional costs on us, could hurt
our ability to compete profitably with other financial institutions, or could
have other material adverse effects on us.
Additionally, changes in applicable law, if enacted, including those
that would permit banks to pay interest on checking and demand deposit accounts
established by businesses, could have a significant negative effect on net
interest income, net income, net interest margin, return on assets, and return
on equity.
Government policy relating to the deposit insurance funds may also
adversely affect our results of operations. Under current law and regulation, if
the reserve ratio of the Bank Insurance Fund falls below 1.25%, all insured
banks will be required to pay deposit insurance premiums. We do not currently
pay any deposit insurance premiums. Payment of deposit insurance premiums will
have an adverse effect on our earnings. These changes or other legislative or
regulatory developments could have a significant negative effect on our net
interest income, net income, net interest margin, return on assets, and return
on equity.
CAUTION ABOUT FORWARD LOOKING STATEMENTS
We make forward-looking statements in this prospectus that are subject
to risks and uncertainties. These forward-looking statements include: statements
of goals, intentions, and earnings expectations; estimates of risks and future
costs and benefits; assessments of probable loan and lease losses; assessments
of market risk; and statements of the ability to achieve financial and other
goals. These forward-looking statements are subject to significant uncertainties
because they are based upon or are affected by: management's estimates and
projections of future interest rates, market behavior, and other economic
conditions; future laws and regulations; and a variety of other matters which,
by their nature, are subject to significant uncertainties. Because of these
uncertainties, our actual future results may differ materially from those
indicated. In addition, our past results of
3
operations do not necessarily indicate its future results.
SELLING SECURITY HOLDERS
The three directors who are reoffering shares in this prospectus, the
amount of common stock beneficially owned by them as of the date of this
prospectus, and the number of shares each of them is reoffering are shown below:
Shares
beneficially Shares
Director owned reoffered
-----------------------------------------------------------
John Chirtea 40,465 420
Gilbert L Hardesty 9,676 350
Craig A. Ruppert 28,244 350
WHERE YOU CAN FIND ADDITIONAL INFORMATION
ABOUT SANDY SPRING BANCORP, INC.
We file annual, quarterly, and special reports, proxy statements and
other information with the SEC. You may read and copy any reports, statements or
other information that we file with the SEC at the SEC's public reference room
at 450 Fifth Street, NW, Washington, D.C. 20549. Please call the SEC at
1-800-SEC-0330 for further information on the public reference room. The SEC
maintains a World Wide Web site on the Internet at "http://www.sec.gov" that
contains reports, proxy and information statements, and other information
regarding companies, including Sandy Spring Bancorp, Inc., that file
electronically with the SEC.
We have filed a Registration Statement on Form S-8 to register the
common stock to be sold in the reoffering. This prospectus is a part of that
Registration Statement. As allowed by SEC rules, this prospectus does not
contain all the information you can find in the Registration Statement or the
exhibits to the Registration Statement. SEC regulations require us to
"incorporate by reference" information into this prospectus, which means that
important information is disclosed by referring you to another document filed
separately with the SEC. The information incorporated by reference is considered
part of this prospectus. Information incorporated by reference from earlier
documents is superseded by information that is included in this prospectus or is
incorporated by reference from more recent documents, to the extent that they
are inconsistent.
DOCUMENTS INCORPORATED BY REFERENCE
This prospectus incorporates by reference the documents listed below
that we have previously filed with the SEC (file no. 0-1906).
(1) Annual Report on Form 10-K for the year ended December 31, 2003;
(2) Quarterly Report on Form 10-Q for the period ended March 31,
2004;
(3) Current Reports on Form 8-K filed January 15, 2004 and April 15,
2004; and
(4) The Description of Capital Stock contained in Item 5 of the
Annual Report on Form 10-K for the year ended December 31, 1997.
Also incorporated by reference are additional documents that we may
file with the SEC under Section 13(a), 13(c), 14, or 15(d) of the Securities
Exchange Act of 1934 after the date of this prospectus and before the
termination of the offering. These additional documents will be deemed to be
incorporated by reference, and to be a part of, this prospectus from the date of
their filing. These documents include proxy statements and periodic reports,
such as Annual Reports on Form 10-K, Quarterly Reports on Form 10-Q, and to the
extent they are considered filed, Current Reports on Form 8-K. Information
incorporated by reference from later filed documents supersedes information that
is included in this prospectus or is incorporated by reference from earlier
documents, to the extent that they are inconsistent.
4
You can obtain any of the documents incorporated by reference from us,
the SEC, or the SEC's Internet web site as described above. Documents
incorporated by reference are available from Sandy Spring Bancorp, Inc. without
charge, including any exhibits specifically incorporated by reference therein.
You may obtain documents incorporated by reference in this prospectus by
requesting them by phone or in writing from Ronald E. Kuykendall, Executive Vice
President, General Counsel and Corporate Secretary, at Sandy Spring Bancorp,
Inc., 17801 Georgia Avenue, Olney, Maryland 20832, (301) 774-6400.
You should rely only on the information contained or incorporated by
reference in this prospectus. We have not authorized anyone to provide you with
information that is different from the information contained in this prospectus.
You should not assume that the information contained in this prospectus is
accurate as of any date other than the date of this prospectus.
INDEMNIFICATION OF DIRECTORS AND OFFICERS
Sandy Spring's Articles of Incorporation generally provide for
indemnification to the extent authorized by applicable law. Section 2-418 of the
Maryland General Corporation Law sets forth circumstances under which directors,
officers, employees and agents of Sandy Spring may be insured or indemnified
against liability which they may incur in these capacities. The Maryland General
Corporation Law provides, in pertinent part, as follows:
2-418 INDEMNIFICATION OF DIRECTORS, OFFICERS, EMPLOYEES AND AGENTS. --
(a) In this section the following words have the meanings indicated.
(1) "Director" means any person who is or was a director of a corporation and
any person who, while a director of a corporation, is or was serving at the
request of the corporation as a director, officer, partner, trustee,
employee, or agent of another foreign or domestic corporation, partnership,
joint venture, trust, other enterprise, or employee benefit plan.
(2) "Corporation" includes any domestic or foreign predecessor entity of a
corporation in a merger, consolidation, or other transaction in which the
predecessor's existence ceased upon consummation of the transaction.
(3) "Expenses" include attorney's fees.
(4) "Official capacity" means the following:
(i) When used with respect to a director, the office of director in the
corporation; and
(ii) When used with respect to a person other than a director as
contemplated in subsection (j), the elective or appointive office in the
corporation held by the officer, or the employment or agency relationship
undertaken by the employee or agent in behalf of the corporation.
(iii) "Official capacity" does not include service for any other foreign or
domestic corporation or any partnership, joint venture, trust, other
enterprise, or employee benefit plan.
(5) "Party" includes a person who was, is, or is threatened to be made a
named defendant or respondent in a proceeding. (6) "Proceeding" means any
threatened, pending or completed action, suit or proceeding, whether civil,
criminal, administrative, or investigative.
(b)(1) A corporation may indemnify any director made a party to any proceeding
by reason of service in that capacity unless it is established that:
(i) The act or omission of the director was material to the matter giving
rise to the proceeding; and
1. Was committed in bad faith; or
2. Was the result of active and deliberate dishonesty; or
(ii) The director actually received an improper personal benefit in money,
property, or services; or
(iii) In the case of any criminal proceeding, the director had reasonable
cause to believe that the act or omission was unlawful.
(2)(i) Indemnification may be against judgments, penalties, fines,
settlements, and reasonable expenses actually incurred by the director in
connection with the proceeding.
(ii) However, if the proceeding was one by or in the right of the
corporation, indemnification may not be made in respect of any proceeding
in which the director shall have been adjudged to be liable to the
corporation.
(3)(i) The termination of any proceeding by judgment, order, or settlement
does not create a presumption that the director
5
did not meet the requisite standard of conduct set forth in this subsection.
(ii) The termination of any proceeding by conviction, or a plea of nolo
contendere or its equivalent, or an entry of an order of probation prior to
judgment, creates a rebuttable presumption that the director did not meet
that standard of conduct.
(4) A corporation may not indemnify a director or advance expenses under this
section for a proceeding brought by that director against the corporation,
except:
(i) For a proceeding brought to enforce indemnification under this section;
or
(ii) If the charter or bylaws of the corporation, a resolution of the board
of directors of the corporation, or an agreement approved by the board of
directors of the corporation to which the corporation is a party expressly
provide otherwise.
(c) A director may not be indemnified under subsection (b) of this section in
respect of any proceeding charging improper personal benefit to the director,
whether or not involving action in the director's official capacity, in which
the director was adjudged to be liable on the basis that personal benefit was
improperly received.
(d) Unless limited by the charter:
(1) A director who has been successful, on the merits or otherwise, in the
defense of any proceeding referred to in subsection (b) of this section shall
be indemnified against reasonable expenses incurred by the director in
connection with the proceeding.
(2) A court of appropriate jurisdiction, upon application of a director and
such notice as the court shall require, may order indemnification in the
following circumstances:
(i) If it determines a director is entitled to reimbursement under
paragraph (1) of this subsection, the court shall order indemnification, in
which case the director shall be entitled to recover the expenses of
securing such reimbursement; or
(ii) If it determines that the director is fairly and reasonably entitled
to indemnification in view of all the relevant circumstances, whether or
not the director has met the standards of conduct set forth in subsection
(b) of this section or has been adjudged liable under the circumstances
described in subsection (c) of this section, the court may order such
indemnification as the court shall deem proper. However, indemnification
with respect to any proceeding by or in the right of the corporation or in
which liability shall have been adjudged in the circumstances described in
subsection (c) shall be limited to expenses.
(3) A court of appropriate jurisdiction may be the same court in which the
proceeding involving the director's liability took place.
(e)(1) Indemnification under subsection (b) of this section may not be made by
the corporation unless authorized for a specific proceeding after a
determination has been made that indemnification of the director is permissible
in the circumstances because the director has met the standard of conduct set
forth in subsection (b) of this section.
(2) Such determination shall be made:
(i) By the board of directors by a majority vote of a quorum consisting of
directors not, at the time, parties to the proceeding, or, if such a quorum
cannot be obtained, then by a majority vote of a committee of the board
consisting solely of two or more directors not, at the time, parties to
such proceeding and who were duly designated to act in the matter by a
majority vote of the full board in which the designated directors who are
parties may participate;
(ii) By special legal counsel selected by the board of directors or a
committee of the board by vote as set forth in subparagraph (i) of this
paragraph, or, if the requisite quorum of the full board cannot be obtained
therefor and the committee cannot be established, by a majority vote of the
full board in which directors who are parties may participate; or
(iii) By the stockholders.
(3) Authorization of indemnification and determination as to reasonableness
of expenses shall be made in the same manner as the determination that
indemnification is permissible. However, if the determination that
indemnification is permissible is made by special legal counsel,
authorization of indemnification and determination as to reasonableness of
expenses shall be made in the manner specified in subparagraph (ii) of
paragraph (2) of this subsection for selection of such counsel.
(4) Shares held by directors who are parties to the proceeding may not be
voted on the subject matter under this subsection.
6
(f)(1) Reasonable expenses incurred by a director who is a party to a proceeding
may be paid or reimbursed by the corporation in advance of the final disposition
of the proceeding upon receipt by the corporation of:
(i) A written affirmation by the director of the director's good faith
belief that the standard of conduct necessary for indemnification by the
corporation as authorized in this section has been met; and
(ii) A written undertaking by or on behalf of the director to repay the
amount if it shall ultimately be determined that the standard of conduct
has not been met.
(2) The undertaking required by subparagraph (ii) of paragraph (1) of this
subsection shall be an unlimited general obligation of the director but need
not be secured and may be accepted without reference to financial ability to
make the repayment.
(3) Payments under this subsection shall be made as provided by the charter,
bylaws, or contract or as specified in subsection (e) of this section.
(g) The indemnification and advancement of expenses provided or authorized by
this section may not be deemed exclusive of any other rights, by indemnification
or otherwise, to which a director may be entitled under the charter, the bylaws,
a resolution of stockholders or directors, an agreement or otherwise, both as to
action in an official capacity and as to action in another capacity while
holding such office.
(h) This section does not limit the corporation's power to pay or reimburse
expenses incurred by a director in connection with an appearance as a witness in
a proceeding at a time when the director has not been made a named defendant or
respondent in the proceeding.
(i) For purposes of this section:
(1) The corporation shall be deemed to have requested a director to serve an
employee benefit plan where the performance of the director's duties to the
corporation also imposes duties on, or otherwise involves services by, the
director to the plan or participants or beneficiaries of the plan;
(2) Excise taxes assessed on a director with respect to an employee benefit
plan pursuant to applicable law shall be deemed fines; and
(3) Action taken or omitted by the director with respect to an employee
benefit plan in the performance of the director's duties for a purpose
reasonably believed by the director to be in the interest of the participants
and beneficiaries of the plan shall be deemed to be for a purpose which is
not opposed to the best interests of the corporation.
(j) Unless limited by the charter:
(1) An officer of the corporation shall be indemnified as and to the extent
provided in subsection (d) of this section for a director and shall be
entitled, to the same extent as a director, to seek indemnification pursuant
to the provisions of subsection (d);
(2) A corporation may indemnify and advance expenses to an officer, employee,
or agent of the corporation to the same extent that it may indemnify
directors under this section; and
(3) A corporation, in addition, may indemnify and advance expenses to an
officer, employee, or agent who is not a director to such further extent,
consistent with law, as may be provided by its charter, bylaws, general or
specific action of its board of directors, or contract.
(k)(1) A corporation may purchase and maintain insurance on behalf of any person
who is or was a director, officer, employee, or agent of the corporation, or
who, while a director, officer, employee, or agent of the corporation, is or was
serving at the request of the corporation as a director, officer, partner,
trustee, employee, or agent of another foreign or domestic corporation,
partnership, joint venture, trust, other enterprise, or employee benefit plan
against any liability asserted against and incurred by such person in any such
capacity or arising out of such person's position, whether or not the
corporation would have the power to indemnify against liability under the
provisions of this section.
(2) A corporation may provide similar protection, including a trust fund,
letter of credit, or surety bond, not inconsistent
7
with this section.
(3) The insurance or similar protection may be provided by a subsidiary or an
affiliate of the corporation.
(l) Any indemnification of, or advance of expenses to, a director in accordance
with this section, if arising out of a proceeding by or in the right of the
corporation, shall be reported in writing to the stockholders with the notice of
the next stockholders' meeting or prior to the meeting.
Insofar as indemnification for liabilities arising under the Securities
Act of 1933, as amended, may be permitted to our directors, officers and
controlling persons pursuant to the foregoing provisions, or otherwise, we have
been advised that in the opinion of the Securities and Exchange Commission such
indemnification is against public policy as expressed in the Act and is,
therefore, unenforceable. In the event that a claim for indemnification against
such liabilities (other than the payment by us of expenses incurred or paid by a
director, officer or controlling person in the successful defense of any action,
suit or proceeding) is asserted by such director, officer or controlling person
in connection with the securities being registered, we 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 of whether such
indemnification by it is against public policy as expressed in the Securities
Act and will be governed by the final adjudication of such issue.
8
PART II
INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
ITEM 3. INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE.
The following documents filed by Sandy Spring Bancorp, Inc. ("Sandy
Spring") with the Securities and Exchange Commission are hereby incorporated by
reference in this Registration Statement:
(1) Annual Report on Form 10-K for the year ended December 31, 2003;
(2) Quarterly Report on Form 10-Q for the period ended March 31,
2004;
(3) Current Reports on Form 8-K filed January 15, 2004 and April 15,
2004; and
(4) The Description of Capital Stock contained in Item 5 of the
Annual Report on Form 10-K for the year ended December 31, 1997.
All documents filed by Sandy Spring Bancorp, Inc. pursuant to Sections
13(a), 13(c), 14 and 15(d) of the Securities Exchange Act of 1934 subsequent to
the date hereof, and prior to the filing of a post-effective amendment hereto
which indicates that all securities offered hereby shall have been sold or which
deregisters all securities remaining unsold, shall be deemed to be incorporated
by reference herein and to be a part hereof from the date of filing of such
documents.
ITEM 4. DESCRIPTION OF SECURITIES
As the securities to be issued pursuant to this registration statement
are registered under Section 12 of the Securities Exchange Act of 1934, this
item is inapplicable.
ITEM 5. INTEREST OF NAMED EXPERTS AND COUNSEL.
Not Applicable.
ITEM 6. INDEMNIFICATION OF DIRECTORS AND OFFICERS
Sandy Spring's Articles of Incorporation generally provide for
indemnification to the extent authorized by applicable law. Section 2-418 of the
Maryland General Corporation Law sets forth circumstances under which directors,
officers, employees and agents of Sandy Spring may be insured or indemnified
against liability which they may incur in these capacities. The Maryland General
Corporation Law provides, in pertinent part, as follows:
2-418 INDEMNIFICATION OF DIRECTORS, OFFICERS, EMPLOYEES AND AGENTS. --
(a) In this section the following words have the meanings indicated.
(1) "Director" means any person who is or was a director of a corporation and
any person who, while a director of a corporation, is or was serving at the
request of the corporation as a director, officer, partner, trustee,
employee, or agent of another foreign or domestic corporation, partnership,
joint venture, trust, other enterprise, or employee benefit plan.
(2) "Corporation" includes any domestic or foreign predecessor entity of a
corporation in a merger, consolidation, or other transaction in which the
predecessor's existence ceased upon consummation of the transaction.
(3) "Expenses" include attorney's fees.
(4) "Official capacity" means the following:
(i) When used with respect to a director, the office of director in the
corporation; and
(ii) When used with respect to a person other than a director as
contemplated in subsection (j), the elective or appointive office in the
corporation held by the officer, or the employment or agency relationship
undertaken by the employee or agent in behalf of the corporation.
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(iii) "Official capacity" does not include service for any other foreign or
domestic corporation or any partnership, joint venture, trust, other
enterprise, or employee benefit plan.
(5) "Party" includes a person who was, is, or is threatened to be made a
named defendant or respondent in a proceeding. (6) "Proceeding" means any
threatened, pending or completed action, suit or proceeding, whether civil,
criminal, administrative, or investigative.
(b)(1) A corporation may indemnify any director made a party to any proceeding
by reason of service in that capacity unless it is established that:
(i) The act or omission of the director was material to the matter giving
rise to the proceeding; and
1. Was committed in bad faith; or
2. Was the result of active and deliberate dishonesty; or
(ii) The director actually received an improper personal benefit in money,
property, or services; or
(iii) In the case of any criminal proceeding, the director had reasonable
cause to believe that the act or omission was unlawful.
(2)(i) Indemnification may be against judgments, penalties, fines,
settlements, and reasonable expenses actually incurred by the director in
connection with the proceeding.
(ii) However, if the proceeding was one by or in the right of the
corporation, indemnification may not be made in respect of any proceeding
in which the director shall have been adjudged to be liable to the
corporation.
(3)(i) The termination of any proceeding by judgment, order, or settlement
does not create a presumption that the director did not meet the requisite
standard of conduct set forth in this subsection.
(ii) The termination of any proceeding by conviction, or a plea of nolo
contendere or its equivalent, or an entry of an order of probation prior to
judgment, creates a rebuttable presumption that the director did not meet
that standard of conduct.
(4) A corporation may not indemnify a director or advance expenses under this
section for a proceeding brought by that director against the corporation,
except:
(i) For a proceeding brought to enforce indemnification under this section;
or
(ii) If the charter or bylaws of the corporation, a resolution of the board
of directors of the corporation, or an agreement approved by the board of
directors of the corporation to which the corporation is a party expressly
provide otherwise.
(c) A director may not be indemnified under subsection (b) of this section in
respect of any proceeding charging improper personal benefit to the director,
whether or not involving action in the director's official capacity, in which
the director was adjudged to be liable on the basis that personal benefit was
improperly received.
(d) Unless limited by the charter:
(1) A director who has been successful, on the merits or otherwise, in the
defense of any proceeding referred to in subsection (b) of this section shall
be indemnified against reasonable expenses incurred by the director in
connection with the proceeding.
(2) A court of appropriate jurisdiction, upon application of a director and
such notice as the court shall require, may order indemnification in the
following circumstances:
(i) If it determines a director is entitled to reimbursement under
paragraph (1) of this subsection, the court shall order indemnification, in
which case the director shall be entitled to recover the expenses of
securing such reimbursement; or
(ii) If it determines that the director is fairly and reasonably entitled
to indemnification in view of all the relevant circumstances, whether or
not the director has met the standards of conduct set forth in subsection
(b) of this section or has been adjudged liable under the circumstances
described in subsection (c) of this section, the court may order such
indemnification as the court shall deem proper. However, indemnification
with respect to any proceeding by or in the right of the corporation or in
which liability shall have been adjudged in the circumstances described in
subsection (c) shall be limited to expenses.
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(3) A court of appropriate jurisdiction may be the same court in which the
proceeding involving the director's liability took place.
(e)(1) Indemnification under subsection (b) of this section may not be made by
the corporation unless authorized for a specific proceeding after a
determination has been made that indemnification of the director is permissible
in the circumstances because the director has met the standard of conduct set
forth in subsection (b) of this section.
(2) Such determination shall be made:
(i) By the board of directors by a majority vote of a quorum consisting of
directors not, at the time, parties to the proceeding, or, if such a quorum
cannot be obtained, then by a majority vote of a committee of the board
consisting solely of two or more directors not, at the time, parties to
such proceeding and who were duly designated to act in the matter by a
majority vote of the full board in which the designated directors who are
parties may participate;
(ii) By special legal counsel selected by the board of directors or a
committee of the board by vote as set forth in subparagraph (i) of this
paragraph, or, if the requisite quorum of the full board cannot be obtained
therefor and the committee cannot be established, by a majority vote of the
full board in which directors who are parties may participate; or
(iii) By the stockholders.
(3) Authorization of indemnification and determination as to reasonableness
of expenses shall be made in the same manner as the determination that
indemnification is permissible. However, if the determination that
indemnification is permissible is made by special legal counsel,
authorization of indemnification and determination as to reasonableness of
expenses shall be made in the manner specified in subparagraph (ii) of
paragraph (2) of this subsection for selection of such counsel.
(4) Shares held by directors who are parties to the proceeding may not be
voted on the subject matter under this subsection.
(f)(1) Reasonable expenses incurred by a director who is a party to a proceeding
may be paid or reimbursed by the corporation in advance of the final disposition
of the proceeding upon receipt by the corporation of:
(i) A written affirmation by the director of the director's good faith
belief that the standard of conduct necessary for indemnification by the
corporation as authorized in this section has been met; and
(ii) A written undertaking by or on behalf of the director to repay the
amount if it shall ultimately be determined that the standard of conduct
has not been met.
(2) The undertaking required by subparagraph (ii) of paragraph (1) of this
subsection shall be an unlimited general obligation of the director but need
not be secured and may be accepted without reference to financial ability to
make the repayment.
(3) Payments under this subsection shall be made as provided by the charter,
bylaws, or contract or as specified in subsection (e) of this section.
(g) The indemnification and advancement of expenses provided or authorized by
this section may not be deemed exclusive of any other rights, by indemnification
or otherwise, to which a director may be entitled under the charter, the bylaws,
a resolution of stockholders or directors, an agreement or otherwise, both as to
action in an official capacity and as to action in another capacity while
holding such office.
(h) This section does not limit the corporation's power to pay or reimburse
expenses incurred by a director in connection with an appearance as a witness in
a proceeding at a time when the director has not been made a named defendant or
respondent in the proceeding.
(i) For purposes of this section:
(1) The corporation shall be deemed to have requested a director to serve an
employee benefit plan where the performance of the director's duties to the
corporation also imposes duties on, or otherwise involves services by,
II-3
the director to the plan or participants or beneficiaries of the plan;
(2) Excise taxes assessed on a director with respect to an employee benefit
plan pursuant to applicable law shall be deemed fines; and
(3) Action taken or omitted by the director with respect to an employee
benefit plan in the performance of the director's duties for a purpose
reasonably believed by the director to be in the interest of the participants
and beneficiaries of the plan shall be deemed to be for a purpose which is
not opposed to the best interests of the corporation.
(j) Unless limited by the charter:
(1) An officer of the corporation shall be indemnified as and to the extent
provided in subsection (d) of this section for a director and shall be
entitled, to the same extent as a director, to seek indemnification pursuant
to the provisions of subsection (d);
(2) A corporation may indemnify and advance expenses to an officer, employee,
or agent of the corporation to the same extent that it may indemnify
directors under this section; and
(3) A corporation, in addition, may indemnify and advance expenses to an
officer, employee, or agent who is not a director to such further extent,
consistent with law, as may be provided by its charter, bylaws, general or
specific action of its board of directors, or contract.
(k)(1) A corporation may purchase and maintain insurance on behalf of any person
who is or was a director, officer, employee, or agent of the corporation, or
who, while a director, officer, employee, or agent of the corporation, is or was
serving at the request of the corporation as a director, officer, partner,
trustee, employee, or agent of another foreign or domestic corporation,
partnership, joint venture, trust, other enterprise, or employee benefit plan
against any liability asserted against and incurred by such person in any such
capacity or arising out of such person's position, whether or not the
corporation would have the power to indemnify against liability under the
provisions of this section.
(2) A corporation may provide similar protection, including a trust fund,
letter of credit, or surety bond, not inconsistent with this section.
(3) The insurance or similar protection may be provided by a subsidiary or an
affiliate of the corporation.
(l) Any indemnification of, or advance of expenses to, a director in accordance
with this section, if arising out of a proceeding by or in the right of the
corporation, shall be reported in writing to the stockholders with the notice of
the next stockholders' meeting or prior to the meeting.
ITEM 7. EXEMPTION FROM REGISTRATION CLAIMED.
The shares of stock reoffered hereby were issued to directors of the
registrant in private transactions exempt from registration under section 4(2)
of the Securities Act of 1933, as amended.
ITEM 8. EXHIBITS.
The exhibits required by Item 601 of Regulation S-K and this item are
included following the Exhibit Index.
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ITEM 9. UNDERTAKINGS.
The Registrant hereby undertakes that it will:
(1) file, during any period in which it offers or sells 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 (the
"Act"); (ii) reflect in the prospectus any facts or events arising after the
effective date of the registration statement (or the most recent post-effective
amendment thereof) which, individually or in the aggregate, represent a
fundamental change in the information in the registration statement; and (iii)
include any material information with respect to the plan of distribution not
previously disclosed in the registration statement or any material change to
such information in the registration statement.
(2) for determining liability under the Act, treat each post-effective
amendment as a new registration statement relating to the securities offered,
and the offering of the securities at that time to be the initial bona fide
offering.
(3) file a post-effective amendment to remove from registration any of
the securities that remain unsold at the end of the offering.
The undersigned Registrant hereby undertakes that, for purposes of
determining any liability under the Act, each filing of the Registrant's annual
report pursuant to section 13(a) or section 15(d) of the Securities Exchange Act
of 1934 (the "Exchange Act") (and, where applicable, each filing of an employee
benefit plan's annual report pursuant to section 15(d) of the Exchange Act) that
is incorporated by reference in the registration statement 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.
Insofar as indemnification for liabilities arising under the 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 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 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 of whether such indemnification by it is against
public policy as expressed in the Securities Act and will be governed by the
final adjudication of such issue.
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SIGNATURES
THE REGISTRANT. Pursuant to the requirements of the Securities Act of
1933, the registrant certifies that it has reasonable grounds to believe that it
meets all of the requirements for filing on Form S-8 and has duly caused this
registration statement to be signed on its behalf by the undersigned, thereunto
duly authorized, in the City of Olney, State of Maryland on July 9, 2004.
By: /s/ HUNTER R. HOLLAR
----------------------------
Hunter R. Hollar, President
and Chief Executive Officer
Pursuant to the requirements of the Securities Act of 1933, as amended, this
registration statement has been signed by the following persons in the
capacities and on the dates indicated.
Signature Title Date
/s/ JOHN CHIRTEA* Director July 9, 2004
-----------------
John Chirtea
/s/ SUSAN D. GOFF* Director July 9, 2004
------------------
Susan D. Goff
/s/ SOLOMON GRAHAM* Director July 9, 2004
-------------------
Solomon Graham
/s/ GILBERT L. HARDESTY* Director July 9, 2004
------------------------
Gilbert L. Hardesty
/s/ CHARLES F. MESS* Director July 9, 2004
--------------------
Charles F. Mess
/s/ ROBERT L. MITCHELL* Director July 9, 2004
-----------------------
Robert L. Mitchell
/s/ ROBERT L. ORNDORFF, JR.* Director July 9, 2004
----------------------------
Robert L. Orndorff, Jr.
/s/ DAVID E. RIPPEON* Director July 9, 2004
---------------------
David E. Rippeon
/s/ CRAIG A. RUPPERT* Director July 9, 2004
---------------------
Craig A. Ruppert
/s/ LEWIS R. SCHUMANN* Director July 9, 2004
----------------------
Lewis R. Schumann
/s/ W. DREW STABLER* Director, Chairman of the July 9, 2004
-------------------- Board
W. Drew Stabler
II-6
/s/ JAMES H. LANGMEAD Executive Vice President and July 9, 2004
--------------------- Chief Financial Officer
James H. Langmead
*By: /s/ THERESA A. CORNISH
----------------------
Theresa A. Cornish, Attorney in Fact
THE PLAN. Pursuant to the requirements of the Securities Act of 1933,
the following members of the Human Resources Committee, which has responsibility
for the administration of the Directors' Stock Purchase Plan, comprising a
majority thereof, have duly caused this registration statement to be signed on
their behalf by the undersigned, thereunto duly authorized, in the City of
Olney, State of Maryland on July 9, 2004.
/s/ JOHN CHIRTEA*
-----------------
John Chirtea
/s/ SUSAN D. GOFF*
------------------
Susan D. Goff
/s/ CHARLES F. MESS*
--------------------
Charles F. Mess
/s/ ROBERT L. MITCHELL*
-----------------------
Robert L. Mitchell
/s/ ROBERT L. ORNDORFF, JR.*
----------------------------
Robert L. Orndorff, Jr.
/s/ CRAIG A. RUPPERT*
---------------------
Craig A. Ruppert
/s/ W. DREW STABLER*
--------------------
W. Drew Stabler
*By: /s/ THERESA A. CORNISH
----------------------
Theresa A. Cornish, Attorney in Fact
INDEX TO EXHIBITS
Exhibit Number Description
-------------- -----------
4 Director Stock Purchase Plan
5 Opinion of Kennedy, Baris & Lundy, L.L.P.
23.1 Consent of Kennedy, Baris & Lundy, L.L.P., included
in Exhibit 5
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23.2 Consent of McGladrey and Pullen, LLP
23.3 Consent of Stegman & Company
24 Power of Attorney
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