Entry Into A Definitive Material Agreement

9 Months Ended

Sep. 30, 2011

Entry Into A Definitive Material Agreement [Abstract]

Entry Into A Definitive Material Agreement

(13) Entry Into a Definitive Material Agreement.

On July 14, 2011, ECB Bancorp, Inc. announced that its subsidiary, The East Carolina Bank (the "Bank"), has entered into a definitive agreement (the "Agreement") with The Bank of Hampton Roads ("Hampton Roads") under which the Bank will acquire five banking offices of Hampton Roads, located in Cary, Chapel Hill, Plymouth and Raleigh, North Carolina. Of the five offices to be acquired, two will be sold at their fair market value and the three other offices will be leased. The Bank has also agreed to purchase three parcels of unimproved real property in Chapel Hill and Raleigh, North Carolina, each at their fair market value, and assume the lease for one parcel of unimproved real property in Durham, North Carolina, in each case for future branch development.

The Agreement provides that the Bank will assume approximately $195 million of deposit liabilities, which includes the deposit liabilities from the Branches as well as deposit liabilities from two additional Hampton Roads branch offices in Roper and Wilmington, North Carolina. The Bank will pay an aggregate 2.4% deposit premium on the deposit liabilities it assumes.

The Bank will not be assuming any brokered deposits, deposit accounts associated with lines of credit, self-directed individual retirement accounts or certain other deposit liabilities in the transaction. Under the agreement, the Bank will purchase the personal property, furniture, fixtures, leasehold improvements and equipment located at the Branches. Management is in the process of evaluating the accounting treatment of the transaction.

Completion of the transaction is subject to receipt of required regulatory approvals and satisfaction of other customary closing conditions.