UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 8-K

CURRENT REPORT

PURSUANT TO SECTION 13 OR 15(d) OF THE

SECURITIES EXCHANGE ACT OF 1934

Date of Report (Date of earliest event reported): January 15, 2009

ECB BANCORP, INC.

(Exact name of registrant as specified in its charter)

North Carolina	000-24753	56-2090738
(State or other jurisdiction of incorporation)	(Commission File Number)	(IRS Employer Identification No.)

Post Office Box 337 Engelhard, North Carolina	27824
(Address of principal executive offices)	(Zip Code)

Registrant’s telephone number, including area code: (252) 925-9411

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

¨ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

¨ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

¨ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

¨ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Item 1.01 Entry Into A Material Definitive Agreement

On January 16, 2009, ECB Bancorp, Inc. (“Registrant”), the parent company of The East Carolina Bank (the “Bank”), entered into a letter agreement (the “Purchase Agreement”) with the United State Department of the Treasury (the “Treasury”), pursuant to which Registrant issued and sold to the Treasury 17,949 shares of Registrant’s Fixed Rate Cumulative Perpetual Preferred Stock, Series A (the “Series A Preferred Stock”) for an aggregate purchase price of $17,949,000 in cash. In conjunction with that sale, Registrant issued to the Treasury a warrant (the “Warrant”) to purchase 144,984 shares of Registrant’s common stock, par value $3.50 per share (the “Common Stock”). A copy of the Purchase Agreement is attached as Exhibit 10.01 to this Report and is incorporated herein by reference.

The Series A Preferred Stock will qualify as Tier 1 capital for purposes of Registrant’s regulatory capital requirements and will pay cumulative dividends at a rate of 5% per annum for the first five years and 9% per annum thereafter. The form of certificate for the Series A Preferred Stock is attached as Exhibit 4.01 to this Report and is incorporated herein by reference. The Series A Preferred Stock may be redeemed by Registrant at any time after three years. Prior to the end of three years, the Series A Preferred Stock may be redeemed by Registrant only with proceeds from the sale of other equity securities of Registrant that qualify for treatment as Tier 1 capital.

The Warrant has a 10-year term and is immediately exercisable upon its issuance, with an exercise price, subject to anti-dilution adjustments, equal to $18.57 per share of the Common Stock. A copy of the Warrant is attached as Exhibit 4.02 to this Report and is incorporated herein by reference. If Registrant receives aggregate gross cash proceeds of not less than $17,949,000 from qualified equity offerings on or prior to December 31, 2009, the number of shares of Common Stock issuable pursuant to the Treasury’s exercise of the Warrant will be reduced by one half of the original number of shares. Pursuant to the Purchase Agreement, the Treasury has agreed not to exercise voting power with respect to any shares of Common Stock issued upon exercise of the Warrant.

The Series A Preferred Stock and the Warrant were issued in a private transaction exempt from registration pursuant to Section 4(2) of the Securities Act of 1933, as amended. Upon the request of the Treasury at any time, Registrant has agreed to promptly enter into a deposit arrangement pursuant to which the Series A Preferred Stock may be deposited and depositary shares (“Depositary Shares”), representing fractional shares of Series A Preferred Stock, may be issued. Registrant also has agreed that, upon the request of the Treasury at any time, it will register the Series A Preferred Stock, the Warrant, the shares of Common Stock underlying the Warrant (the “Warrant Shares”) and Depositary Shares, if any. Neither the Series A Preferred Stock, the Warrant, nor the Warrant Shares will be subject to any contractual restrictions on transfer, except that the Treasury may only transfer or exercise an aggregate of one-half ( ¹/2) of the Warrant Shares prior to December 31, 2009 or, if earlier, the redemption of 100% of the shares of Series A Preferred Stock.

In the Purchase Agreement, Registrant agreed that, until such time as the Treasury ceases to own any debt or equity securities of Registrant acquired pursuant to the Purchase Agreement, Registrant will take all necessary actions to ensure that its compensation and benefit plans with respect to its “senior executive officers” comply with Section 111(b) of the Emergency Economic Stabilization Act of 2008 (the “EESA”) as implemented by any guidance or regulation under the EESA that has been issued and is in effect as of the date of issuance of the Series A Preferred Stock and the Warrant, and has agreed not to adopt any compensation or benefit plans with respect to, or which cover, its senior executive officers that do not so comply, and the applicable executives have consented to the foregoing.

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Item 3.02 Unregistered Sales of Equity

The information set forth under “Item 1.01 Entry into a Material Definitive Agreement” above is incorporated by reference into this Item 3.02.

Item 3.03 Material Modification to Rights of Securityholders

Effective on January 15, 2009, Registrant amended its Articles of Incorporation to create a separate series of its authorized preferred stock designated as its Series A Preferred Stock and, as described in Item 1.01 above, issued 17,949 shares of that stock to the Treasury. Under the terms of the Series A Preferred Stock, unless all accrued dividends have been paid in full on the Series A Preferred Stock, Registrant may not declare or pay dividends or distributions on, or purchase, redeem or otherwise acquire for consideration, shares of its Common Stock or other “Junior Stock” (as defined below) or “Parity Stock” (as defined below). Additionally, even if all dividends have been paid on the Series A Preferred Stock, during the first three years following Registrant’s issuance of the Series A Preferred Stock to Treasury, Registrant is required to obtain the Treasury’s approval in order to increase the dividend per share paid on its Common Stock from the last quarterly cash dividend per share ($0.1825) declared prior to January 16, 2009, or to purchase outstanding shares of its Common Stock, unless the Series A Preferred Stock has been redeemed in full or the Treasury has transferred all of the Series A Preferred Stock to third parties.

The Series A Preferred Stock has a liquidation preference of $1,000 per share. If Registrant is liquidated and its assets are distributed to its shareholders, holders of the Series A Preferred Stock would be entitled to receive that amount, plus the cumulative amount of any accrued but unpaid dividends, for each share before any amount could be distributed to holders of its Common Stock or other Junior Stock.

“Junior Stock” means the Common Stock and any other class or series of Registrant’s stock, the terms of which expressly provide that it ranks junior to the Series A Preferred Stock as to dividend rights and/or rights upon liquidation, dissolution or winding up of Registrant. “Parity Stock” means any class or series of Registrant’s stock, the terms of which do not expressly provide that such class or series will rank senior or junior to the Series A Preferred Stock as to dividend rights and/or rights upon liquidation, dissolution or winding up of Registrant (in each case without regard to whether dividends accrue cumulatively or non-cumulatively).

Item 5.02 Departure of Directors or Certain Officers, Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers

The information concerning restrictions on executive compensation set forth under “Item 1.01 Entry Into a Material Definitive Agreement” is incorporated by reference into this Item 5.02.

On January 16, 2009, in conjunction with the transaction described in Item 1.01 above, Registrant and the Bank entered into Capital Purchase Program Compliance Agreements (“Compliance Agreements”) with each of Messrs. Arthur H. Keeney III, J. Dorson White, Gary M. Adams and T. Olin Davis. Under the terms of the Compliance Agreements, each of the senior executive officers named above agreed to the modification of any existing or future compensation or benefit plans or agreements with each of them, respectively, to the extent required by Section 111(b) of EESA and the rules thereunder, and waived any claim against Registrant, the Bank and the Treasury arising from such modification. The Compliance Agreements also generally provide that, during the period in which the Treasury holds the Series A Preferred Stock, Warrant or Warrant Shares, if any bonus or incentive compensation paid to those senior executive officers is based on materially inaccurate performance criteria, such compensation shall be repaid. Copies of the Compliance Agreements with Registrant’s senior executive officers are attached as Exhibits 10.02, 10.03, 10.04 and 10.05 to this Report and are incorporated herein by reference.

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Item 5.03 Amendments to Articles of Incorporation of Bylaws; Change in Fiscal Year

Effective on January 15, 2009, Registrant amended Article 2 of its Articles of Incorporation by filing Articles of Amendment with the North Carolina Secretary of State. The amendment, which Registrant’s Board of Directors was authorized to approve without a vote of shareholders, created a separate series of Registrant’s authorized preferred stock designated as its Series A Preferred Stock described in Item 1.01 above, and specified the preferences, limitations and relative rights of the Series A Preferred Stock. A copy of the Registrant’s complete Articles of Incorporation, as amended through January 15, 2009, is attached as Exhibit 3.01 to this Report and is incorporated herein by reference.

Item 8.01 Other Events

On January 20, 2009, Registrant issued a press release announcing the transactions described in Item 1.01 above and its sale of Series A Preferred Stock and issuance of Warrants to the Treasury. A copy of the press release is attached as Exhibit 99.1 to this Report.

Item 9.01 Financial Statements and Exhibits

(d) Exhibits. The following exhibits are being filed or furnished with this Report:

Exhibit No.	Exhibit Description
3.01	Registrant’s Articles of Incorporation as amended through January 15, 2009
4.01	Form of Certificate for the Series A Preferred Stock
4.02	Warrant dated January 16, 2009, for the purchase of shares of Common Stock
10.01	Letter Agreement dated January 16, 2009, between the Registrant and the United States Department of the Treasury
10.02	Capital Purchase Program Compliance Agreement dated January 16, 2009, by and among ECB Bancorp, Inc., The East Carolina Bank and Arthur H. Keeney III (amendment to employment agreement)
10.03	Capital Purchase Program Compliance Agreement dated January 16, 2009, by and among ECB Bancorp, Inc., The East Carolina Bank and J. Dorson White (amendment to employment agreement)
10.04	Capital Purchase Program Compliance Agreement dated January 16, 2009, by and among ECB Bancorp, Inc., The East Carolina Bank and T. Olin Davis (amendment to employment agreement)
10.05	Capital Purchase Program Compliance Agreement dated January 16, 2009, by and among ECB Bancorp, Inc., The East Carolina Bank and Gary M. Adams (amendment to employment agreement)
99.1	Press Release dated January 20, 2009

Disclosures About Forward Looking Statements

Statements in this Report and its exhibits relating to plans, strategies, economic performance and trends, projections of results of specific activities or investments, expectations or beliefs about future events or results, and other statements that are not descriptions of historical facts, may be forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. Forward-looking information is inherently subject to risks and uncertainties, and actual results could differ materially from those currently anticipated due to a

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number of factors, which include, but are not limited to, risk factors discussed in our Annual Report on Form 10-K and in other documents we file with the Securities and Exchange Commission from time to time. Copies of those reports are available through our Internet website at www.ecbbancorp.com or directly through the Commission’s website at www.sec.gov. Forward-looking statements may be identified by terms such as “may”, “will”, “should”, “could”, “expects”, “plans”, “intends”, “anticipates”, “believes”, “estimates”, “predicts”, “forecasts”, “potential” or “continue,” or similar terms or the negative of these terms, or other statements concerning opinions or judgments of our management about future events. Factors that could influence the accuracy of such forward-looking statements include, but are not limited to, (a) the financial success or changing strategies of our customers; (b) actions of government regulators, or changes in laws, regulations or accounting standards, that adversely affect our business; (c) changes in the interest rate environment and the level of market interest rates that reduce our net interest margins and/or the volumes and values of loans we make and securities we hold; (d) changes in competitive pressures among depository and other financial institutions or in our ability to compete effectively against other financial institutions in our banking market; (e) changes in general economic and business conditions and changes in real estate values in our banking market (particularly changes that affect our loan portfolio, the abilities of our borrowers to repay their loans, and the values of loan collateral); (f) weather and similar conditions, particularly the effect of hurricanes on our banking and operations facilities and on our customers and the communities in which we do business; and (g) other developments or changes in our business that we do not expect. Although we believe that the expectations reflected in the forward-looking statements are reasonable, we cannot guarantee future results, levels of activity, performance or achievements. All forward-looking statements attributable to us are expressly qualified in their entirety by the cautionary statements in this paragraph.

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SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, as amended, Registrant has duly caused this Report to be signed on its behalf by the undersigned thereunto duly authorized.

	ECB BANCORP, INC.
	(Registrant)
Date: January 21, 2009	By:	/S/ Gary M. Adams
		Gary M. Adams
		Chief Financial Officer

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EXHIBIT INDEX

Exhibit No.	Exhibit Description
3.01	Registrant’s Articles of Incorporation as amended through January 15, 2009
4.01	Form of Certificate for the Series A Preferred Stock
4.02	Warrant dated January 16, 2009, for the purchase of shares of Common Stock
10.01	Letter Agreement dated January 16, 2009, between the Registrant and the United States Department of the Treasury
10.02	Capital Purchase Program Compliance Agreement dated January 16, 2009, by and among ECB Bancorp, Inc., The East Carolina Bank and Arthur H. Keeney III (amendment to employment agreement)
10.03	Capital Purchase Program Compliance Agreement dated January 16, 2009, by and among ECB Bancorp, Inc., The East Carolina Bank and J. Dorson White (amendment to employment agreement)
10.04	Capital Purchase Program Compliance Agreement dated January 16, 2009, by and among ECB Bancorp, Inc., The East Carolina Bank and T. Olin Davis (amendment to employment agreement)
10.05	Capital Purchase Program Compliance Agreement dated January 16, 2009, by and among ECB Bancorp, Inc., The East Carolina Bank and Gary M. Adams (amendment to employment agreement)
99.1	Press Release dated January 20, 2009

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