ECB Bancorp, Inc. (NASDAQ:ECBE) (“ECB” or the “Company”), the parent company of East Carolina Bank (the “Bank”), announced today that it has entered into an agreement with certain institutional investors to issue $75 million in Company common stock in a private placement offering, subject to the receipt of shareholder and regulatory approval. In connection with the transaction, the Company will issue $75 million in common stock to investors at a price of $16.00 per share. The Company anticipates that, upon consummation of the transaction, the proceeds of the offering will be used to support the Company’s future operational growth, to redeem the Company’s $17.8 million of preferred stock (subject to regulatory approval) and associated warrants previously issued pursuant to the TARP Capital Purchase Program, to further enhance the capital of East Carolina Bank and for other general corporate purposes.

“We are pleased to announce the $75 million common stock offering, which we believe will be beneficial to our shareholders and will enhance our strategic opportunities to grow and diversify our geographic footprint, including organic growth, de novo market expansion, and potential future acquisitions,” stated A. Dwight Utz, President and CEO of ECB Bancorp, Inc. “The Board of Directors and management of the Company are also pleased to align ourselves with the investors in the offering. Patriot Financial Partners, L.P. and Endicott Management Company, along with the other investors in the transaction, are experienced investors who will bring additional expertise and focus to our Company.”

Private Placement Terms

The private placement will total $75 million and include the sale of 4,687,500 shares of Company common stock at $16.00 per share. In addition, the Company will issue to investors warrants with five-year terms that are convertible into voting or non-voting common stock at an exercise price of $8.00 per share. The amount of shares of common stock subject to exercise under the warrants will equal 25% of the number of shares of common stock to be issued to the investors in the private placement. As part of the private placement, three investors will be granted the right to appoint an individual to the Board of Directors of the Company and the Bank.

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