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F.N.B. Corporation Expands Franchise With Acquisition Of Annapolis Bancorp, Inc.

HERMITAGE, Pa. and ANNAPOLIS, Md., Oct. 22, 2012 /PRNewswire/ -- F.N.B. Corporation (NYSE: FNB) and Annapolis Bancorp, Inc. (NASDAQ: ANNB) jointly announce the signing of a definitive merger agreement pursuant to which F.N.B. Corporation will acquire Annapolis Bancorp, Inc., the Annapolis-based holding company and parent of BankAnnapolis, in an all stock transaction valued at approximately $12.09 per share, or $51 million in the aggregate using the closing stock price as of Friday, October 19, 2012.

The acquisition of the Annapolis-based bank will provide F.N.B. Corporation with $437 million in total assets, including $343 million in total deposits, $297 million in loans and 8 banking offices in Anne Arundel and Queen Anne's counties, Maryland. The transaction will create a four-state banking presence for F.N.B. Corporation, which will have $12.2 billion in assets.

Under the terms of the merger agreement, which has been approved by the boards of directors of both companies, shareholders of Annapolis Bancorp, Inc. will be entitled to receive 1.143 shares of F.N.B. Corporation common stock for each share of Annapolis Bancorp, Inc. stock. The exchange ratio is fixed and the transaction is expected to qualify as a tax-free exchange for shareholders of Annapolis Bancorp, Inc. A cash credit-related adjustment provides that shareholders of Annapolis Bancorp, Inc. may receive up to an additional $0.36 per share in cash for each share of Annapolis Bancorp, Inc. stock they own, dependent on Annapolis Bancorp, Inc.'s ability to resolve an agreed-upon credit matter.

"This transaction is an attractive market entry opportunity and is consistent with our expansion strategy," said Vincent J. Delie, Jr., President and Chief Executive Officer of F.N.B. Corporation. "The favorable demographics and long-term growth potential of Annapolis Bancorp's core markets, as well as additional opportunities in the greater Baltimore and Washington D.C. areas, provide a compelling platform to leverage our successful business model." Delie continues, "In addition, Annapolis Bancorp is a well-established, respected institution with very strong local relationships and an excellent customer service culture."

"Comprehensive and competitive financial products, a proven commitment to local communities and an outstanding record of shareholder value creation are just a few reasons why F.N.B. is an ideal partner for our shareholders, customers, employees and the communities we serve. We are confident that they will all benefit immensely from this combination," said Richard M. Lerner, Chairman and Chief Executive Officer of Annapolis Bancorp, Inc. and BankAnnapolis.

F.N.B. Corporation expects the merger to be highly accretive on a marginal basis to its earnings per share and slightly accretive to earnings per share in the first full year (excluding one-time costs). Additionally, the transaction is expected to be neutral to F.N.B. Corporation's tangible book value per share.

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