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COASTAL FINANCIAL CORPORATION
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The following is a series of written questions and answers distributed
to employees of Coastal Financial Corporation (the "Company") on December 21,
2006 in connection with the Company's December 21, 2006 announcement regarding
its proposed merger with BB&T Corporation.
QUESTION & ANSWERS
On the merger of Coastal Financial Corporation with BB&T Corporation
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WHAT WILL HAPPEN TO COASTAL FINANCIAL CORPORATION?
Coastal Financial Corporation will join the BB&T family. Coastal
Financial will merge with BB&T Corporation in a tax-free stock exchange valued
at $394.6 million. The transaction is valued at $17.04 per share of Coastal
Financial common stock based on a stock swap option and BB&T's closing price
Wednesday of $44.27. Coastal Financial shareholders will receive 0.385 shares of
BB&T stock for each share of Coastal Financial common stock.
HOW LONG WILL IT TAKE UNTIL THE MERGER IS COMPLETED?
It is BB&T's objective to complete this merger as quickly and efficiently
as possible. We expect to complete the merger in the second quarter of 2007,
following regulatory and shareholder approval.
WHAT ABOUT EMPLOYEES' SALARIES AND BENEFITS?
Within the next two weeks, an orientation kit will be sent to each
employee's home address, which contains general information about BB&T's
benefits. In the next 90 days, BB&T will begin conducting a series of benefits
meetings for employees. At a later date, you will receive a Benefits Enrollment
Package and be asked to attend a benefits enrollment meeting.
WHEN WILL BB&T BENEFITS BECOME EFFECTIVE?
Typically, BB&T benefits begin within 60 days of the data conversion,
which follows completion of the acquisition. After the merger is completed, you
will receive a comprehensive package outlining your new BB&T benefits. BB&T
offers excellent benefits, including a "cafeteria" plan for health and dental
coverage, a pension plan, and a 401(k) plan with BB&T matching up to 6 percent
of employee contributions. BB&T was ranked as the No. 2 bank in MONEY magazine's
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survey of "Corporate America's Best Benefits," and No. 29 among the top
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companies.
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Q & A BB&T / COASTAL FINANCIAL CORPORATION
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WILL THERE BE ANY LAYOFFS AS A RESULT OF THIS MERGER?
There will be consolidation of back-office functions so we do anticipate
some job reduction. We expect to minimize job reductions through attrition,
opportunities to retrain for new jobs within BB&T's community banking regions,
and opportunities throughout the BB&T system.
In the event of a layoff, an excellent severance package will be
available to effected Coastal Financial employees. Also, BB&T will establish an
Outplacement Center to assist displaced employees in finding comparable or
better jobs.
WILL ANY COASTAL FINANCIAL OFFICES CLOSE?
There will be some branch closings due to the proximity of nearby BB&T
offices. It does not make business sense to operate branches in close proximity
to one another. In some instances it will be a BB&T branch that closes. However,
we expect very few branch personnel to lose their jobs. They will, in most
instances, be transferred to nearby locations. It is important to keep employees
who have established relationships with their clients. Following conversion,
Coastal Financial branches will join existing BB&T branches in BB&T's Coastal SC
and Southeast NC regions.
Coastal Financial President and CEO Mike Gerald will remain with BB&T and
will be heavily involved in the merger transition. Other bank officers are
expected to remain with the company.
CAN CLIENTS OF COASTAL FINANCIAL BE TOLD ABOUT THE MERGER?
Yes. Clients will receive several mailings that will further explain the
changes they can expect. However, nothing will change until after conversion.
The changes will include access to BB&T's wider variety of products and
services. The merger is expected to close in the second quarter of 2007.
Q & A BB&T / COASTAL FINANCIAL CORPORATION
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WHAT SHOULD COASTAL FINANCIAL EMPLOYEES TELL CLIENTS ABOUT THE MERGER?
Coastal Financial clients will continue to bank with the same people they
have for years, receiving the same friendly and personal service. Coastal
Financial clients will have the resources of a $120.2 billion financial
institution with a broad network in 11 states and Washington, D.C., as well as
an expanded range of products and services to choose from.
WHAT WILL HAPPEN TO THE COASTAL FINANCIAL BOARD OF DIRECTORS?
Coastal Financial's board of directors will be asked to serve on BB&T's
local advisory boards.
WHEN CAN BB&T PRODUCTS AND SERVICES BE OFFERED?
Coastal Financial clients will not be able to receive BB&T products or
services until after the conversion of Coastal Financial's operating systems
into BB&T's operating systems. BB&T University will personally introduce Coastal
Financial employees to BB&T products and services, as well as sales solutions
used by BB&T employees.
Q & A BB&T / COASTAL FINANCIAL CORPORATION
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WHY IS BB&T INTERESTED IN COASTAL FINANCIAL?
BB&T's strategy is to pursue high quality in-market banks and thrifts in
the $500 million to $15 billion range in Southeastern and mid-Atlantic markets
that improve our financial performance and franchise value. The acquisition of
Coastal Financial will expand BB&T's South Carolina franchise by raising its
market share rank to No. 1 from No. 4 in the Myrtle Beach-Conway-North Myrtle
Beach, S.C., metropolitan statistical area, the 13th fastest growing MSA in the
nation. It will also enhance its No. 1 rank in the Wilmington, N.C., MSA.
Wilmington is home to North Carolina's deep sea water port and its local economy
continually outperforms both the state and national economies. BB&T has three
community bank regions in South Carolina and eight in North Carolina.
HOW CAN A $120.2 BILLION ORGANIZATION LIKE BB&T CALL ITSELF A "HOMETOWN" BANK?
BB&T takes great pride in its community banking philosophy. In 1989, BB&T
divided its banking network into community bank regions so that as it grew, each
community bank would remain customer focused. Each of BB&T's current 34 regions
looks and acts like a community bank. It operates more than 1,450 branches in
the Carolinas, Georgia, Florida, Tennessee, Alabama, Kentucky, Virginia,
Maryland, West Virginia, Indiana and Washington, D.C. More than 95 percent of
the decisions are made locally. We give considerable authority to our regional
presidents and their employees. In addition, BB&T emphasizes community
involvement.
IS BB&T CORPORATION A PUBLICLY HELD COMPANY?
Yes. It's listed on the New York Stock Exchange under the trading symbol
"BBT." BB&T is included in the S&P 500 Index, a leading indicator of stock
performance among major U.S. companies. BB&T is followed by 30 analysts
representing such investment firms as A.G. Edwards & Sons, Inc.; Bear, Stearns &
Company Inc.; Goldman Sachs & Co.; Keefe, Bruyette & Woods; Merrill Lynch;
Morgan Stanley; and Prudential Securities. BB&T Corporation has approximately
$24 billion in market capitalization and more than 541 million shares
outstanding. A Morgan Stanley study placed BB&T in the Top 3% of S&P 500
companies in dividend yield. For the fourth consecutive year, BB&T has been
included in FORBES magazine's Platinum 400 list of America's "Best Big
Companies". It is ranked No. 4 in the super-regional banks category in FORTUNE
magazine's "America's Most Admired Companies."
Q & A BB&T / COASTAL FINANCIAL CORPORATION
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WHAT DOES "BB&T" STAND FOR?
BB&T - which stands for Branch Banking & Trust - is named for Alpheus
Branch, who founded the bank in 1872 in the eastern North Carolina town of
Wilson. BB&T is the oldest bank headquartered in North Carolina.
WHAT IS BB&T'S CORPORATE MISSION?
To make the world a better place to live by:
Helping our CLIENTS achieve economic success and financial security;
Creating a place where our EMPLOYEES can learn, grow and be
fulfilled in their work;
Making the COMMUNITIES in which we work better places to be; and
thereby:
Optimizing the long-term return to our SHAREHOLDERS, while providing
a safe and sound investment.
WHAT CAN I DO TO HELP?
Maintain an enthusiastic, positive attitude when telling your clients
about the merger. Our clients' views of the merger depend on how they think you
feel about it. You can really help by making them feel good about BB&T.
WHERE CAN I GET MORE INFORMATION ABOUT BB&T?
We encourage you to visit our Web site at BBT.com. It features
information on BB&T's products and services, financial performance and history,
and recent news announcements.