Carolina Financial Corporation (Nasdaq: CARO), the parent company of CresCom Bank, and First South Bancorp, Inc. (Nasdaq: FSBK), the parent company of First South Bank, announced today that they have received all required regulatory approvals and the approval of each company's stockholders to proceed with the merger of First South with and into Carolina Financial.

Pursuant to the terms of the Agreement and Plan of Merger and Reorganization, dated as of June 9, 2017, the initial exchange ratio of 0.5200 was subject to decrease in the event that the average closing price per share of Carolina Financial common stock was greater than $35.14 over a specified period prior to completion of the merger and Carolina Financial common stock outperformed the NASDAQ Bank Index by 15% or more between the signing date and the end of the specified period. Both conditions have been met. Accordingly, each outstanding share of First South common stock will be exchanged for 0.5064 shares of Carolina Financial common stock.

The closing of the mergers of Carolina Financial and First South and their subsidiary banks are expected to occur on November 1, 2017. Thereafter, CresCom Bank will operate the former offices of First South under the name "First South Bank" until the data processing system conversion, which is currently expected to occur in March 2018.

About Carolina Financial Corporation

Carolina Financial Corporation (NASDAQ: CARO) is the holding company of CresCom Bank, which also owns and operates Atlanta-based Crescent Mortgage Company. As of September 30, 2017, Carolina Financial Corporation had approximately $2.3 billion in total assets.

About First South Bancorp, Inc.

First South Bancorp, Inc. (NASDAQ: FSBK) is a Virginia corporation that serves as the holding company for First South Bank, a North Carolina-chartered commercial bank. The Company was originally incorporated as a Delaware corporation in 1996. In 1999, First South changed its state of incorporation from Delaware to Virginia.