If any of the securities being registered on this Form are being offered on a delayed or continuous basis pursuant to Rule 415 under the Securities Act of 1933, other than securities offered only in connection with dividend or interest reinvestment plans, check the following box: x

 

 

 

If this Form is a registration statement pursuant to General Instruction I.D. or a post-effective amendment thereto that shall become effective upon filing with the Commission pursuant to Rule 462(e) under the Securities Act, check the following box: r

 

If this Form is a post-effective amendment to a registration statement filed pursuant to General Instruction I.D. filed to register additional securities or additional classes of securities pursuant to Rule 413(b) under the Securities Act, check the following box: r

 

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company.  See the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer      r                                                                    Accelerated filer x

Non-accelerated filer        r                                                                  Smaller reporting company r

(Do not check if a smaller reporting company)

 

CALCULATION OF REGISTRATION FEE

 

Title of each class of Securities to be registered	Amount to be registered	Proposed maximum aggregate offering price per security	Proposed maximum aggregate offering price	Amount of registration fee
Warrant to Purchase Common Stock, $.01 par value per share (1)	556,976	-- (2)	-- (2)	-- (2)
Common Stock, $.01 par value per share (1)	556,976	$6.30(3)	$3,508,949	$138
TOTAL:			$3,508,949	$138

 

(1)

This Registration Statement covers (a) a warrant for the purchase of 556,976 shares of common stock with an initial per share exercise price of $6.30 per share, (b) the 556,976 shares of common stock issuable upon exercise of such warrant and (c) such additional number of shares of common stock, of a currently indeterminable amount, as may from time to time become issuable by reason of stock splits, stock dividends and certain anti-dilution provisions set forth in such warrant, which shares of common stock are registered hereunder pursuant to Rule 416.

 

(2)	Pursuant to Rule 457(g), no separate registration fee is required with respect to the warrant as it is being registered in the same registration statement as the common stock offered pursuant thereto.

 

(3)	Calculated in accordance with Rule 457(g) based upon the per share exercise price of the warrant of $6.30.

 

 

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    The Registrant hereby amends this Registration Statement on such date or dates as may be necessary to delay its effective date until the Registrant shall file a further amendment which specifically states that this Registration Statement shall thereafter become effective in accordance with Section 8(a) of the Securities Act of 1933 or until this Registration Statement shall become effective on such date as the Commission, acting pursuant to said Section 8(a), may determine.

 

 

 

 

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The information in this prospectus is not complete and may be changed. We may not sell these securities until the registration statement filed with the Securities and Exchange Commission is effective.  This prospectus is not an offer to sell these securities and it is not soliciting an offer to buy these securities in any state where the offer or sale is not permitted.

 

PROSPECTUS

Subject to Completion

 

Dated December 19, 2008

 

 

SEVERN BANCORP, INC.

 

Warrant to Purchase 556,976 Share of Common Stock

 

556,976 Shares of Common Stock

 

_____________________

 

This prospectus relates to the potential resale from time to time by selling securityholders of some or all of a warrant to purchase 556,976 shares of common stock, referred to as the warrant, and any shares of common stock issuable from time to time upon exercise of the warrant. In addition, this prospectus covers the issuance by us of common stock upon the exercise of the warrant by the holders other than the initial selling securityholder.  In this prospectus, we refer to the warrant and the shares of common stock issuable upon exercise of the warrant, collectively, as the securities. The warrant and 23,393 shares of our Fixed Rate Cumulative Perpetual Preferred Stock, Series B, referred to as the series B preferred stock, were originally issued by us pursuant to the Letter Agreement dated November 21, 2008, and the related Securities Purchase Agreement – Standard Terms, between us and the United States Department of the Treasury, which we refer to as the initial selling securityholder, in a transaction exempt from the registration requirements of the Securities Act of 1933, as amended, referred to as the Securities Act.

 

The initial selling securityholder and its successors, including transferees, which we collectively refer to as the selling securityholders, may offer the securities from time to time directly or through underwriters, broker-dealers or agents and in one or more public or private transactions and at fixed prices, prevailing market prices, at prices related to prevailing market prices or at negotiated prices. If these securities are sold through underwriters, broker-dealers or agents, the selling securityholders will be responsible for underwriting discounts or commissions or agents’ commissions.

 

We will not receive any proceeds from the sale of securities by the selling securityholders.  If the warrant is exercised in full for cash, we will receive proceeds of approximately $3.5 million.

 

The warrant is not listed on an exchange, and, unless requested by the initial selling securityholder, we do not intend to list the warrant on any exchange.

 

Our common stock trades on the Nasdaq Capital Market under the symbol “SVBI.” On December 18, 2008, the closing price of our common stock on the Nasdaq Capital Market was $3.85 per share. You are urged to obtain current market quotations of the common stock.

 

This investment involves risks.  See “Risk Factors” on page 4.

 

Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved of these securities, or determined if this prospectus is truthful or complete.  Any representation to the contrary is a criminal offense.

 

 

The date of this prospectus is [                               ].

 

 

 

 

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TABLE OF CONTENTS

 

	Page
ABOUT THIS PROSPECTUS	1
FORWARD-LOOKING STATEMENTS	1
SUMMARY	3
RISK FACTORS	4
USE OF PROCEEDS	4
DESCRIPTION OF WRRANT TO PURCHASE COMMON STOCK	5
DESCRIPTION OF COMMON STOCK	7
PLAN OF DISTRIBUTION	8
SELLING SECURITYHOLDERS	9
LEGAL MATTERS	10
EXPERTS	10
INTERESTS OF NAMED EXPERTS AND COUNSEL	11
INCORPORATION BY REFERENCE	11

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ABOUT THIS PROSPECTUS

 

This prospectus is part of a registration statement we filed with the Securities and Exchange Commission, referred to as the SEC, using a “shelf” registration process.  Under this shelf registration process, the selling securityholders may, from time to time, offer and sell, in one or more offerings, the securities described in this prospectus.  In addition, this prospectus covers the issuance by us of common stock upon the exercise of the warrant by the holders other than the initial selling securityholder.

 

We may provide a prospectus supplement containing specific information about the terms of a particular offering by the selling securityholders.  The prospectus supplement may add, update or change information in this prospectus.  If the information in this prospectus is inconsistent with a prospectus supplement, you should rely on the information in the prospectus supplement.  You should read both this prospectus and, if applicable, any prospectus supplement.  You should rely only on the information contained or incorporated by reference in this prospectus.  We have not, and any underwriters have not, authorized anyone to provide you with information different from that contained in this prospectus.  If anyone provides you with different or inconsistent information, you should not rely on it.

 

We are not offering to sell shares of common stock or seeking offers to buy shares of common stock in any jurisdiction where offers and sales are not permitted.  The information contained in this prospectus is accurate only as of the date of this prospectus, regardless of the time of delivery of this prospectus or any sale of the common stock offered hereby.  As used in this prospectus, “Severn,” “Bancorp,” “we,” “our,” “ours” and “us” refer to Severn Bancorp, Inc. and its consolidated subsidiaries, except where the context otherwise requires or as otherwise indicted.

 

FORWARD-LOOKING STATEMENTS

 

 Certain statements included in this prospectus or in the documents incorporated by reference in this prospectus, other than statements of historical fact, are forward-looking statements (as such term is defined in the Securities Exchange Act of 1934, referred to as the Exchange Act, and the regulations thereunder), which are intended to be covered by the safe harbors created thereby. Forward-looking statements include, but are not limited to:

 

·	statements contained in “Risk Factors;”

 

·	statements contained in “Business” in our most recent Annual Report on Form 10-K concerning liquidity and business plans;

 

·

statements contained in “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and notes to Bancorp’s financial statements in our most recent Annual Report on Form 10-K and Quarterly Report on Form 10-Q concerning the allowance for loan losses, liquidity, capital adequacy requirements, unrealized losses, guarantees, related party transactions and impact of accounting pronouncements;

 

·	competitive strengths; and

 

·	statements as to trends or Bancorp’s or management’s beliefs, expectations and opinions.

 

The words “anticipate,” “believe,” “estimate,” “expect,” “intend,” “may,” “plan,” “will,” “would,” “could,” “should,” “guidance,” “potential,” “continue,” “project,” “forecast,” “confident,” and similar expressions are typically used to identify forward-looking statements.  These statements are based on assumptions and assessments made by management in light of their experience and their perception of historical trends, current conditions, expected future developments and other factors they believe to be appropriate.  Any forward-looking statements are not guarantees of Bancorp’s future performance and are subject to risks and uncertainties and may be affected by various factors that may cause actual results, developments and business decisions to differ materially from those in the forward-looking statements.  Some of the factors that may cause actual results, developments and business decisions to differ materially from those contemplated by such forward-looking statements include the risk factors discussed under the heading “Risk Factors” in Bancorp’s Annual Report on Form 10-K for the year ended December 31, 2007, Bancorp’s Quarterly Report on Form 10-Q for the quarter ended June 30, 2008 and the following:

 

 

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·	changes in general economic and political conditions and by governmental monetary and fiscal policies;

 

·	changes in the economic conditions of the geographic areas in which Bancorp conducts business;

 

·	changes in interest rates;

 

·	a downturn in the real estate markets in which Bancorp conducts business;

 

·	environmental liabilities with respect to properties Bancorp has title;

 

·	changes in federal and state regulation;

 

·	Bancorp’s ability to estimate loan losses;

 

·	competition;

 

·	breaches in security or interruptions in Bancorp’s information systems;

 

·	Bancorp’s ability to timely develop and implement technology;

 

·	Bancorp’s ability to retain its management team;

 

·	Bancorp’s ability to maintain effective internal controls over financial reporting and disclosure controls and procedures; and

 

·	terrorist attacks and threats or actual war.

Bancorp can give no assurance that any of the events anticipated by the forward-looking statements will occur or, if any of them does, what impact they will have on Bancorp’s results of operations and financial condition.  Bancorp disclaims any intent or obligation to publicly update or revise any forward-looking statements, regardless of whether new information becomes available, future developments occur or otherwise.

 

 

 

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SUMMARY

 

We are a savings and loan holding company chartered as a corporation in the state of Maryland in 1990.  We conduct business through three subsidiaries:  Severn Savings Bank, FSB, our principal subsidiary, referred to as the Bank; Louis Hyatt, Inc., which is doing business as Hyatt Commercial, a commercial real estate brokerage and property management company; and SBI Mortgage Company, which holds mortgages that do not meet the underwriting criteria of the Bank, and is the parent company of Crownsville Development Corporation, which is doing business as Annapolis Equity Group, which acquires real estate for syndication and investment purposes.    

 

The Bank has four branches in Anne Arundel County, Maryland, which offer a full range of deposit products, and originate mortgages in its primary market of Anne Arundel County, Maryland and, to a lesser extent, in other parts of Maryland, Delaware and Virginia.

 

Our executive and administrative offices are located at 200 Westgate Circle, Suite 200, Annapolis, Maryland 21401 and our telephone number is (410) 260-2000.

 

The Offering:

 

Warrants offered in this prospectus………….	Warrant to purchase 556,976 shares of common stock.
Common stock offered in this prospectus……	556,976 shares of common stock issuable upon exercise of the warrant.
Common stock outstanding as of December   18, 2008……………………………………...	10,066,679 shares.
Use of proceeds………………………………	We will not receive any proceeds from the sale of the securities by the selling securityholders.  If the warrant is exercised in full for cash, we will receive proceeds of approximately $3.5 million, which we intend to use for general corporate purposes.  See “Use of Proceeds.”
Risk factors…………………………………..	The warrant and shares of common stock offered in this prospectus involve a high degree of risk.  See “Risk Factors.”
Nasdaq Capital Market Symbol for our common stock………………………………..	“SVBI”

 

 

 

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RISK FACTORS

 

Investing in our securities involves a high degree of risk. Please see the risk factors described under the caption “Risk Factors” in our Quarterly Report on Form 10-Q for the quarter ended June 30, 2008 as well as any updated risk factors described in our Annual Report on Form 10-K or Quarterly Report on Form 10-Q which we may file with the SEC in the future, all of which are incorporated by reference in this prospectus and in any accompanying prospectus supplement.

 

Before making an investment decision, you should carefully consider these risks as well as information we include or incorporate by reference in this prospectus and in any accompanying prospectus supplement. The risks and uncertainties we have described are not the only ones facing our company. Additional risks and uncertainties not presently known to us or that we currently deem immaterial may also affect our business operations.

 

If any of these risks or uncertainties materializes or any of these assumptions proves incorrect, our results could differ materially from the forward-looking statements. All forward-looking statements in this proxy statement/prospectus are current only as of the date on which the statements were made. We do not undertake any obligation to publicly update any forward-looking statement to reflect events or circumstances after the date on which any statement is made or to reflect the occurrence of unanticipated events.

 

USE OF PROCEEDS

 

We will not receive any proceeds from the sale of the securities by the selling securityholders.  If the warrant is exercised in full for cash, we will receive proceeds of approximately $3.5 million, which we intend to use for general corporate purposes.

 

 

 

 

 

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