Capital Purchase Program and Stock Offerings

12 Months Ended

Dec. 31, 2011

Capital Purchase Program and Stock Offerings [Abstract]

Capital Purchase Program and Stock Offerings

Note 23. Capital Purchase Program and Stock Offerings

On January 30, 2009, as part of the Capital Purchase Program established by the U.S. Department of the Treasury (the “Treasury”) under the Emergency Economic Stabilization Act of 2008, Middleburg Financial Corporation (the “Company”) entered into a Letter Agreement and Securities Purchase Agreement-Standard Terms (collectively, the “Purchase Agreement”) with the Treasury, pursuant to which the Company sold (i) $22,000 shares of the Company's Fixed Rate Cumulative Perpetual Preferred Stock, Series A, par value $2.50 per share, having a liquidation preference of $1,000 per share (the “Preferred Stock”) and (ii) a warrant (the “Warrant”) to purchase 208,202 shares of the Company's common stock, par value $2.50 per share (the “Common Stock”), at an initial exercise price of $15.85 per share. As a result of the completion of the Company's public stock offering in August 2009, the number of shares of Common Stock underlying the Warrant was reduced by one-half to 104,101.  The Company raised approximately $19.2 million through the issuance of 1,908,598 shares of common stock as a result of the offering, as well as another $5.0 million in a private offering to one shareholder which resulted in the issuance of an additional 454,545 shares of common stock.

On December 23, 2009, the Company redeemed all 22,000 shares of Preferred Stock pursuant to the Purchase Agreement.  During 2011, the Warrant was sold by the U.S. Treasury at public auction and has not been exercised as of December 31, 2011.