09053_ChowanVeneer_Eligibility_20051110

A,
NCDENR '
North Carolina Department of Environment and Natural Resources
Dexter Ft Matthews, Director _ Division of Waste Management Michael F. Easley, Governor
William G. Ross Jr:, Secretary
f . , November 10, 2005
Sent Via E-mail and USPS ! .
Mr. James T. Dickson, II
Vice Prekdent/Re
gional Credit Analyst
Southern Bank & Southern BancShares (NC)
148 East Main Street
Beiliavea, NC 27810-0087
iames.dickson(a.)sOuthembank.corn
Subject: Letter of Eligibility
Chowan Veneer Company
259 & 262 Coke Avenue
Edenton, Chowan County
Brownfields Project Number 09053-05-21
Dear Mr. Dickson:
The North Carolina Department of Environment and Natural Resources (DENR) has received and
reviewed your October 18, 2005 Letter of Intent (LOl) submitted on behalf of Southern Bank as a Prospective
Developer (PD) seeking a brownfields agreement regarding the subject site. Upon review of the letter with
respect to the requirements of the Brownfields Property Reuse Act of 1997, DENR has determined that this
project is eligible for entry into the North Carolina Brownfields Program and for continued evaluation for a
brownfields agreement. ;
The next step in the process will involve a detailed review of available environmental and other relevant
data to determine what is currently known about contamination at the site, and what, if any, information gaps
may exist that may require additional assessment. We are in receipt of the following documents:
Memorandum Subject Date
To Mr. David May VEZDWQ) Report of Contamination Detected October 10, 2005
From Lisa Riddick ast (Chowan Veneer property in Edenton, NC)
Historical site information from the files of DENR's Division of Waste Management will also be
utilized during the evaluation process. Please forward any additional information or data you may have or can
acquire for our evaluation. This should include reports from other DENR agencies or regional offices. We will
contact you regarding any additional assessment that may be necessary to establish that the property is or can be
made safe for the intended reuse, as required by statute. -
1646 Mail Service Center, Raleigh, North Carolina 27699-1646
Phone [phone] FAX 919-715�36051 Internet hffp://wastenotnc.org
An Equal opportunity / Affimutive Action Employer— Prinled on Dual Pu►pose Recyded Paper

Since 1901
if UV[§
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�outherrrn ti1- 0
October 18" 2005
C,
Mr. Tony:Duque
Brownfields Projects Manager
Division of Waste Management
North Carolina Department of Environment and Natural Resources
401 Oberlin Road, Ste. 150
Raleigh, North Carolina, 27699=1646
Re: LETTER OF INTENT •
From; Southern Bank
For; Chowan, Veneer Company,, Inc., Property in Edenton, NC
Dear Mr. Duque:
E Main Street Belhaven, NC 27810-0087
POST OFFICE BOX 87
TELEPHONE [phone]
FAX [phone]
0 Qo!�)3-05- 21
Following'the findings of an. environmental survey per by NorthEast
Environmental, P.C. on October 6,.2005 for Southern Bank of".property owned by
Chowan Veneer Company,•Inc. -that the bank is in the process of foreclosing on in
Edenton, North Carolina, it was determined that some contamination had occurred. Upon
review by David -May with NCDENR, Division—of—ater_Quality; Aquifer Protection
Section, it was judged that the level of contamination at :the site appeared relatively minor
and was not likely to lie pursued for additional-assessmentor cleanup._However, as
liability cannot be ruled out in the future, this unlimited and indefinite potential for 1Pt0V`
expense is expected to depress the'marketability for future, developers 'to the point that
Southern Bank will not be able to get a fair market value at auction for the property and Ci1�✓p"."�"`
may elect not to take possession for fear of incurring unknown liabilities. This. situation
may result;in the property laying idle for .years until such time as contaminants leach
from soils and monitored test wells disclose that the contaminant levels have lowered to
maximum soil contaminant concentration levels for soil -to -groundwater set by the
NCDENR. Therefore; I am, requesting protection under the North Carolina Brownfields
Program Agreement covenant not -to -sue in order to market or acquire and market to a
prospective , developer.
Southem 1raank is requesting that the North Carolina Department of Environment and
Natural Resources, Division of Waste Management, name it as the initial prospective
de elop Southern Bank and Southern cShares WN.C.),_Inc--an its"affiliat se and So
�?vu«��tt�-Da�uc-anu_1.Iusi l^ompany_, lioshen,_1nc.,_and.Affiliated:MMo gage s
Services,_(L_,, maintain principal- offices at 116 East Main Street, Mount Olive, North A �
Carolina, 28365. Their website is www.southeriibank.com and the phone number for the
executive offices is [phone] and the home office fax number is (919);658-7065.
MEMBER FDIC
and your community
i

Mr. James T. Dickson, II
November 10, 2005�?;: '
Page 2 of 2
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According to the!L'OI, Southern Bank is Mi the' process of foreclosinedn this property and'intends to
offer this property`for public sale. Please appnse`me within thirty'(30) days whether Soutliern'Bank`a ipa61
selling the Property before or after conclusion of -the brownfields process. If before, we need from Southern
Bank the name, e-mail address and U.S. mail address of the buyer, so we may: 1) e-mail a request for
acknowledgment regarding recordation of the Ndi.ee of Brownfields Property (NBP) by Southern Bank after
that party has become the owner of the property, 2) add to Southern Bank's signature block in the NBP a t
signature block for the buyer, and 3) at the conclusion of the process, mail the NBP to that party for signing. '
I am excited about the potential for public benefit offered by the safe reuse of the • former 'Chowan " •, ,
' `a': c •.. ., - � rx lli]..�tatt`,V
Veneer Company properties, and I look forward to working with you to,advaiice this brownfields t o
redevelopment project. If you have questions about this correspondence or require additional' information, „
please feel free to contact me by e-mail at Linda. [e-mail] or the project manager, Sandra Moog,
by e--mail at Sandra.Moore ,ncmail.net or by phone at [phone].
Sincerely,
Linda Culpepper, Deputy Director
Division of Waste Management
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Southern Bank is North Carolina's third oldest state chartered bank and has assets of over
one billion dollars. Stockholder equity is nearly one hundred million dollars. The Bank
operates fifty locations in eastern North Carolina. Southern Bank agrees to covenant with
the State of North Carolina and its Department of Environment and Natural Resources
under the North Carolina Brownfields Agreement for the purpose of protection from
environmental cleanup liabilities not of it's making and to transfer those protections to a
final potential developer. Southern Bank also agrees to comply will all applicable
procedural requirements under the agreement. The bank further asserts that it can and will
pay all statutorily required fees under the program- so as to enjoy all protections and
benefits offered under the program.
The subject property is the Chowan Veneer Company, Inc, located at 259 and 262 Coke
Avenue, Edenton, N.C.. The property exists in two tracts. �l 2 acre tract containing a
1,434 square foot -metal shop, a 1,050 square foot shed and a hook up for a mobile home.
The Chowan County Tax PIN n, ber for this property is 7805-20-92-6121. The 262
Coke Avenue site contain ms and an office and plant containing about 43,421
square feet constructed fore most part in 1968. The Chowan County Tax PIN number
is 7815-17-02-2182. The Company suspended operations in February or March of this
year. On April 26, 2005, it filed for Chapter 7 Bankruptcy protection in The U.S.
Bankruptcy Court's Eastern District of North Carolina (Case # 05-03364-8-JRL). The
attorney for the debtor was John W. Halstead. Southern Bank was named as the major
creditor with $330,000.00 of the $956,164.37 of total debt outstanding. Chowan Veneer
Company, Inc. had operated on its current site since before its incorporation date of
January 1, 1959. Chowan Veneer Company, Inc. is an "S" corporation that has been
operated by the principal owners James E. and Deanna H. Darnell of,1511 B. West
Queen Street, Edenton, NC. Deanna's father had founded the business and her husband
James E. Darnell took over as President in 1964 while Deanna served as Secretary. The
company manufactured various hardwood veneers with a focus on high quality custom
orders in later years. The company used heavy equipment to handle logs, forklifts,
various electric chippers, de -barkers, saws, jointers, lathes, splicers, grinders, conveyors,
compressors dryers and boilers. Various solvents such as Aqua Amonia Corrosive, Resin
Bon 813, and Varsol along with Urea Formaldehyde Resin (liquid and powdered) glues
were used in the manufacturing process. Various greases and oils were used for machine
lubrication and off road diesel fuel was used to power the heavy equipment. A Diesel fuel
spill is probably according to David May, the likely original source of current
contamination. Many of these substances remain stored on site.
Southern Bank hopes to be able, once the protection from suit and liability is received, to
incur additional expense of disposing of chemicals and fuels on site and to offer this
property for public sale subject to terms and conditions described in our promissory note,
security agreement and applicable law. We hope to be able to bid in the property if
necessary to protect our interest and it's value to assure that an investor of sufficient
resource might become the ultimate owner who will develop this property into a highest
and best use that is consistent and in concert with the surrounding residential and small
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business properties. This propertywould seem to be a good site for redevelopment into
residential lots. Nine 1200 square foot homes valued at'$130,000 each would likely
produce a new tax base total of.$1,170,000.00, a small boutique mall or office complex
as income producing property.might yield more. These types of development would, in
my'judgment, be consistent with the surrounding neighborhood. The veneer business is
rapidly moving outside of the United States and the equipment on this site is antiquated.
There is little hope of the property, existing as a veneer company. The 1968 facility also
does not lend itself well to being transformed into any other light industrial facility. The
cur�rentaax value ofythe property (appraised 03196)is.$434,45-1_.0
Should cleanup protection be unavailable, the bank may not be willing to incur additional
expense along with an unlimited and indefinite cleanup liability It also may not be
willing to risk becoming the final owner and.the property might be sold at an extremely
depressed price to an investor who may elect to allow the property to sit idle for years
until such time as the contaminants leach away or he/she is compelled by city ordinances
or condemnation actions to clean up the property. The next tax assessment may be forced.
to devalue the property based on its current use and condition thus reducing the local tax
base. This property adjoins residential properties. It currently offers a breeding ground for
vermin, snakes, mosquitoes, and ticks. It is a dangerous attraction for children living
nearby. and offers a unsupervised location for illegal activities. It is, my hope that n order
to protect surrounding interests that you would give this application a favorable
consideration. _
Included .herewith Ware;
An Affadavit certifying that Southern Bank, nor it's affiliates caused or contributed to
the contamination of the subjectproperty and of compliance with terms and
requirements of any current or previous remediations and Federal and State laws.
1:24,000 U.S.G.S. topographic quadrangle reap plotting location of subject property.
Survey plat of the subject property.
Predevelopment photographs
Chowan County Tax Cards
Consolidated Caparative Quarterly Report of financial codition of Southern
Southern BancShares (N.C.), Inc. dated June 30, 2005.
Condensed copy of findings ,of environmental assessment report by Lisa A. Riddick,
L.G., Registered Environmental Property Assessor, NorthEast Environmental, P.C.

r
North Carolina Department of Environment "and. Natural Resources
t In, the matter of. Southern Bank
t
" Under, the. Authority of North Carolina General Statutes SS 130A-310.30 et.seq.
Affidavit
Re: Responsibility and Compliance "
James T, D.ickson, .II, being duly sworn, hereby deposes and says:
1. I am Vice President of Southern Bank.
2. 1 am fully authorized.to make declarations contained herein and to legally bind
Southern Bank.
r
3. .Southern Bank is applying fora BrownfieldsAgreement with the North Carolina
Department of Environment and Natural Resources, pursuant to N.C.'G.S. SS
130A, Article 9, Part 5 (Brownfields Act), in relation to the following 7815-17-
02-2182 and 78,15-17-02-21.82 parcels in Edenton, Chowan County, North
Carolina: 259 arid•262 Coke Avenue.
4. 1 hereby certify, under the pains and penalties of perjury and `of the BFrownfields
Act, that`SouthermBank, and"any parent , subsidy or'bther;affiliate meets the
eligibility requirements ofN.C.G.S. SS 130A-310:32(a)(1) in that it' did not cause
or contribute to the contamination :at the parcels cited in the proceeding
paragraph...
5. I hereby certify, under the pains and penalties of perjury and"of the Brownfields
Act, that Southern Bank, meets the eligibility requirement ofN:C.G',S. SS 130A=
310.32(a)(1) in_that it and any parent; subsidiary- -orbtlier' affiliate have substantly .
complied witl%-
a. the terms;of any brownfields or similar. agreement to''Which it or any
parent, subsidiary or other affiliate has, been a party;
b. the requirements applicable.to any remediation in which it or any parent,
subsidiary or other affiliate has previously engaged;
c. federal,and state laws, regulations and rules for the protection of the
environment.
_ Affiant further,.saith not.
Signature/Printed Name -Date
Sworn•to'and subscribed'before me
day of', . ,200S
Notary Public
My commission expires: 3 . 3 g ( SEAT)

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SCHEDULE "A"
BEGINNING,at a. point marked by an iron pipe, said point being a common
corner for the right of way of the Norfolk Southern Railway Company,
M. W. Jackson and the property hereby conveyed, and running thence from
said point along the Eastern margin of the right,of,way of said Norfolk
southern Railway Company North 22 deg. 51 min. East 175 feet to an iron
pipe and North'18 deg. Best, 677.70 feet to an iron pipe at the property
line of B. W. Evans; thence along the said Evans property line and the
Southern boundary of the Oakdale Subdivision South 61 deg. 11 min. East,
1338.20 feet along a line of chopped trees to an iron pipe in the
property line of O. B. Bunch, thence along the said Bunch, property line,
the center of a ditch, South 28 deg. 32 min. West, 494.34 feet to an
iron pipe at the property line of H. W. Jackson) thence along the said
isckson property, line, a wire fence North 67 deg. 26 min. West, 265
feet to an iron pipe at the chopped.15 inch oak, thence continuing along
the property line of M. W. Jackson, a wire fence, South 23 deg. 46 min.
West 89 feet to an iron pipe, North 85 deg. 31 min. Weat, 70.80 feet
to an iron pipe, North 67 deg. 46 min. West 119 feet to an iron pipe,
North 48 deg. 14 min. West 331.40 feet to an iron pipe. at the chopped
20 inch oak; North 67 deg. 36 min. West 420 feet to an -iron pipe and
South 33 deg. 32 min. West, 17.9.33 feet to the point of BEGINNING,
containing 18.252 acres, as per plat of W. Leslie Morgan, Registered
Surveyor, No. L-862 dated June 20, 1963 entitled "Map of Property of
Chowan Veneer Company, Ino." duly recorded in the office of the Register
of Deeds of Chowan County in Plat Book 3, page 80 and being the some
property conveyed to the said first party by three deeds duly of record"
In the aforementioned office in Book of Deeds 015, page 135,* Book 014,
page 334 and Book 010, page 416 reference to which deeds and those
instruments mentioned therein is made for further description and -chain
o
f title:
LESS AND EXCEPT THE FOLLOWING DESCRIBED TRACTS!
Tract 01: All of Lots 1, 2, 3', 4, 5, 6, 7,'and 8 according to the
car a n survey plat by Jasper W. Hassell dated July 10, 1971 and duly,
recorded in Plat Book 6, page.81 of the'Chowen County Public Registry.
See also Book 30, page 357.
Tract 2a Beginning at an iron pipe -in the West margin of Coke Avenue,
said pipe also being in the Southwest corner of Lot #8 of the property
of the Twiddy Insurance & Real Estate Co., Inc. as shown in Plat Book
6, page 81 of the Chowan County Public Registry; and running .thence
from said beginning point and along the West margin of Coke Avenue South
18 deg. 28 min. West.61.5 feet to an iron pipe; thence North 70 deg. .
24 min. West along the line of other property of Chowan Veneer Company,
Inc. 302.1 feet to an iron pin in the East margin of the right of way
of the Norfolk d southern Railway (mainlinel; thence North 21 deg.' 12
min. East along said railroad right of way 111.4 feet ,to an iron pipe;
and thence along a ditch, and adjoining Lot 18 in the aforesaid
subdivision South 60 deg. 53 min. East 301.9 feet to the place of
beginning. For further description see that certain survey plat entitled
"Property of E..L. Hollowell" by Jasper W. Haseellf* dated October 25,
1971 and duly recorded in Plat Book 6, page 91 of the Chowan County
Registry, reference to which plat and the plat hereinabove mentioned
is hereby inade for further description and chain of title. see alio
Book 91, page 705.• "
Tract 031 All of Lots No. 1, 2, 3, 4, 5, 6, 7, 8, 9, and 10 according
to a certain survey plat by Jasper W. Hassell dated October 25, 1971
and duly recorded in Plat Book 7, page 8 of the Chowan County Public
Registry, reference to which p1aE is made for'further description and
chain of title. See also Book 93, page 655.
SUBJECT TO the easements and rights of way conveyed to the Town of
Edenton by instruments duly of record in the aforementioned office in
Deed Book 1.5, page 57;_RW Book 2, page 96 and Book 93, page 653._
i
OWAN 9 N CON N0.
BYs

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TABLE OF CONTENTS
Mission StatemEnt
I
Shareholders Letter
.2
Financial Highlights
4
Local Board of Directors
6
General Officers
z
Local Officers
.jo
Branch Directory
I
-4
q -
F
-G
OUR MISSION
Founded in 1901, Southern Bank is a customer -focused
community bank serving Eastern North Carolina. Our
mission is to be the bank of preference for consumers and
businesses in the markets that we serve.
Genuine concern for the customer is our top priority,
striving to create and deliver superior value in the
financial services we provide by exceeding the
expectations of our customers.
We are dedicated to the communities we serve, both in
spirit and support. We provide a progressive and
rewarding working environment for our employees that
encourages the investment of their time, energy, and
talents to the betterment of their communities.
We embrace sound banking philosophies that incorporate
dedication to relationships, strong business values, and
financial integrity while advocating the maintenance of high
quality assets and reasonable return on
' shareholder investment.
Southern BancShares includes 53 full -service Southern
Bank offices located throughout Eastern North Carolina
and Affiliated Mortgage Services (AMS) located in Rocky
Mount, NC. AMS is a complete mortgage service provider
for Southern Bank and other financial institutions.
(See pages 14-16 for a complete list of branches.)

TO OUR SHAREHOLDERS:
The first six months of 2005 have been marked by a
continued improvement in earnings and overall financial
performance for your Company. The improved operating
results presented herein can be attributed to the ongoing
improvement in the national economy, as well as expansion
of our Dare County, North Carolina presence with a May
2004 Manteo branch opening and the September 2004
expansion into Northampton County, North Carolina with the
acquisitions of branches in Seaboard and Woodland. The total
number of branches in your Southern Bank financial service
network is now 53 and the total assets of your Company has
grown to $1.1 billion as of June 30, 2005.
Branch expansions in the Duplin and Pitt County markets are
currently underway. In Kenansville, a new permanent building
is under construction to replace the current modular office.
Construction of Southern Bank's 54th location in Winterville,
North Carolina, is scheduled to begin in August of 2005.
Net income for the first six months of 2005 was $4.5 million,
an increase of sixty-two percent from the same 2004 period.
This increase in earnings is primarily attributable to the
improving economy that resulted in significant increases in
both net interest income and realized gains on sales of
available -for -sale securities in the first six months of 2005
compared to the first six months of 2004.
The operating results at June 30, 2005 reflect an annualized
return on average assets of 0.85 percent and an annualized
return on average equity of 9.73 percent. Earnings per
weighted -average common share for the six months ended
June 30, 2005 of $39.10 was a sixty-nine percent increase
from the $23.18 earnings per common share for the six
months ended June 30, 2004.
I believe that, as the overall economy continues to improve
and financing rates return to more typical market -driven
levels, Bancshares is strategically positioned to be the
preferred financial service provider in our expanded markets.
Total assets increased $36 million to $1.1 billion at June 30,
2005 from $1.0 billion at June 30, 2004. Total loans of
Southern Bancshares at June 30, 2005 were $679 million, an
increase of seven percent over the same 2004 period. Total
deposits of Southern Bancshares at June 30, 2005 were
$910 million, an increase of three percent over the same
2004 period.
Your Company continues to emphasize the primary strong
business value goals of dedication to customer -focused
community bank relationships, financial integrity and quality
financial services delivery. Bancshares continues to seek
opportunities to expand Southern Bank's presence in its
existing markets through management of both internal
growth and acquisition opportunities.
I am pleased with the overall results and sincerely thank
our shareholders, staff, customers and friends for their
confidence in, loyalty to and support of Southern Bank
and Southern Bancshares.
Sincerely, n
G /7.94--
John C. Pegram, Jr.
Chairman of the Board
t 2
3

Southern BancShares (N.C.), Inc., and Subsidiary
For the Quarter Ended Year to Date
PERCENT
Financial Highlights (Unaudited)
June 30, • June 30,
CHANGE
(Dollars in thousands, except per share data)
2005 2004 2005 2004
YTD
Summary Balance Sheet
Assets
Cash, Due from Banks and Overnight Funds Sold ................
$ 58,172 $ 71,428
-19%
Investments, Fair Value of $282,182 and $274,309..............
282,703 274,753
3%
Loans Less Loss Allowance of $10,792 and $10,292............
667,713 622,847
7%
Other Assets........................................................................
53,363 57,271
-7%
Total Assets........................................................................
$1,061,951 $1,026,299
3%
Liabilities and Shareholders' Equity
Noninterest-Bearing Deposits ....................................... .... :.. I186,550
173,009
8%
Interest -Bearing Deposits ....................................................
723,751
709,521
2%
Total Deposits......................................................................
910,301
882,530
3%
Borrowings..........................................................................
43,380
41,771
4%
Other Liabilities ................................................. :..................
9,875
11,674
-15%
Total Other Liabilities..........................................................
53,255
53,445
-
Total Liabilities....................................................................
963,556
935,975
3%
Shareholders' Equity
Preferred Stock - Series B....................................................
1,753
1,734
1 %
Preferred Stock - Series C....................................................
525
552
-5%
CommonStock..................................................................
545
555
-2%
.Retained Earnings................................................................
78,122
72,183
8%
Accumulated Other Comprehensive Income ..........................
17,450
15,300
14%
Total Shareholders' Equity ................................................
98,395
90,324
9%
Total Liabilities and Shareholders' Equity ..........................
$1,061,951
$1,026,299
3%
Note: Southern Bank and Trust Co. had standby letters of
credit as of June 30, 2005 of $5,766. .
Southern Bank and Trust Co. had standby letters of
credit as of June 30, 2004 of $5,997.
Earnings Performance
Interest Income........................................................................
$13,081
$11,184
$25,358
$22,113
15%
Interest Expense......................................................................
3,688
2,968
7,067
5,932
19%
Net Interest Income..........................................................
9,393
8,216
18,291
16,181
13%
Provision For Loan Losses........................................................
300
300
600
600
-
Noninterest Income................................................................
! 3,434
2,551
6,291
5,334
18%
Noninterest Expense..............................................................
8,742
8,606
17,542
17,161
2%
Income Before Income Taxes ............................................
( 3,785
1,861
6,440
3,754
72%
Income Taxes..........................................................................
1,235
602
1990
1,000
99%
,Net Income..............................................................................
! $ 2,550
$ 1,259
$ 4,450
$ 2,754
62%
Earnings Per Share..................................................................
$ 22.61
$ 10.56
$ 39.10
$ 23.18
Return On Average Assets ......................................................
0.85%
0.54%
Return On Average Equity ......................................................
9.73%
6.11 %
Safety and Soundness
Nonperforming Assets as a Percentage of Total Assets ..............
0.40%
0.37%
Allowance For Loan Loss as a Percentage of Loans ..................
1.60%
1.64%
Net Annualized Charge -offs / Average Loans ..........................
0.02%
0.13%
Allowance For Loan Loss/Nonperforming Loans ........................
326.44%
343.41%
4

STATE o,y0
4
l Z�s
State of North Carolina
ROY COOPER Department of Justice
Nr70R NEYGENERiL P. O. BOX 629
RALEIGH
2 7602-0629
October 13, 2006
Sent Via E-mail and USPS
Mr. James T. Dickson, III
Vice President/Regional Credit Analyst
Southern Bank & Southern BancShares (NC)
148 East Main Street
Belhaven, NC 27810-0087
j ames. dickson(allouthernb ank. com
Reply to Robert R. Gelblum
Environmental Division
[phone]
Fax: [phone]
[e-mail]
Subject: Completion of BFA WTBP
Chowan Veneer Company
259 & 262 Coke Avenue
Subject: Conclusion of Brownfields Agreement Process
Former Chowan Veneer Company Brownfields Project
Edenton, Chowan County
Brownfields Project Number 09053-05-21
Dear Mr. Dickson:
We are very pleased to be bringing the Brownfields Agreement process regarding the
subject project to a successful conclusion. To that end, please find enclosed the Notice of
Brownfields Property (Notice) for this Property, certified by the North Carolina Department of
Environment and Natural Resources (DENR) via the signature -of Linda M. Culpepper, Deputy
Director of the Division of Waste Management, on both the Notice's documentary and plat
components. The Brownfields Agreement (Agreement) for this Property, signed as well for
DENR by Ms. Culpepper, is also enclosed.
Please promptly effect signing, by the necessary persons on the Prospective Developer's
side of this transaction, of the Agreement and.the documentary component of the Notice (note
the need for notarization of the signature on that document) and file the documentary component
of the Notice, with its three exhibits (Exhibit A, the Agreement; Exhibit B, the 8%2 by 11
reduction of the survey plat; and Exhibit C, the legal description of the Property), and the actual,

�.i
fita1.N<jftfication for a Brownfields Property-Edenton/Chowan
()ajec.+ 3 -o
Subject: Inital'Notification for a Brownfields Property-Edenton/Chowan'
From: Sandra Moore <[e-mail]>
Date: Wed, 26 Oct 2005 10:46:47 -0400
To: [e-mail], "<\"Andrew Pitner - MRO Aquifer Protection\">"
<[e-mail]>, "<\"Ted Bush - DWQ Aquifer Protection\">"
<[e-mail]>, "<\"Jack Butler - DWM SF Section\">" <[e-mail]>,
"<\'Dave Lown - SF FRB\">" <[e-mail]>, "<\'Jim Bateson - DWM SF Section,
SERB\">" <[e-mail]>, "<\'Charlotte Jesneck - DWM SF Section IHSB\">"
<[e-mail]>, "<\"Jim Coffey - DWM SW Section\">"
<[e-mail]>, "<\'Liz Cannon - DWM HW Section\">"
<[e-mail]>, "<\'Mike Williford - HW Compliance - East\">"
<[e-mail]>, "<\'Jesse Wells - HW Compliance - West\">"
<[e-mail]>, "<\"Doug Holyfield - Haz. Waste Compliance\">"
<[e-mail]>, "<\"Helen Cotton - DWM HW Section PB\">"
<[e-mail]>, "<\'Bud McCarty - DWM HW Section FMB\">"
<[e-mail]>, "<\"Grover Nicholson DWM UST Section\">"
<[e-mail]>, "<\"Rob Krebs - UST Section\">" <[e-mail]>,
"<\"Coleen Sullins - DWQ WQ Section\">" <[e-mail]>, david may
<[e-mail]>, lyn hardison <[e-mail]>, edythe mckinney
<[e-mail]>, scott bullock <[e-mail]>, john powers
<[e-mail]>, rick shiver <[e-mail]>, ethan brown
<[e-mail]>, mark poindexter <[e-mail]>
CC: "<\"Linda Culpepper - DWM\">" <[e-mail]>, "<\'Dexter Matthews -
DWM\">" <[e-mail]>, "<\'Bruce Nicholson - DWM BF Program\">"
<[e-mail]>, "<\"Shirley Liggins - DWM BF Program\">"
<[e-mail]>, SANDRA MOORE <[e-mail]>
To DENR Cleanup Programs:
This is an internal courtesy notice to inform your program that the DENR
Brownfields Program is in receipt of a Letter of Intent (LOI), submitted by
Southern Bank & Southern BancShares (NC) as prospective developer (PD), seeking
entry into the brownfields program for the following property:
*Site Name: Chowan Veneer Company
Address:•259 & 262 Coke Avenue-
City/County: Edenton, Chowan County
AKA: None known**
Known Identifying Numbers:
**NCD#: None known
**GW Incident #: None known
**Others? None known*
We are now evaluating Southern Bank & Southern BancShares (NC) and the subject
property for eligibility for entry into the Brownfields Program. Under the
Brownfields Property Reuse Act, only entities that did not cause or contribute to
the contamination at the property are eligible to enter the program. The applicant
PD below has asserted that 1) it has not caused or contributed to the contamination
at the property, and 2) that it has substantially complied with laws, regulations,
and rules for the protection of the environment. If you have any information to
suggest otherwise, please provide that information to me (via the contact
information at the bottom of this notice) by *November 9, 2005*.
**Information regarding the applicant PD, including the primary PD contact person,
is as follows:
1 of 2 10/26/2005 10:47 AM

WLN,'atification for Brownfields Property-Edenton/Chowan
*James T. Dickson, II, Vice President/ Regional Credit Analyst
Southern Bank & Southern Bancshares
116 East Main Street
Mount Olive,,N_C,•28365
919-65,8=7065-
/*It is important to note that..a Brownfields Agreement (BFA") has no.legal effect on
your agency!,.s autlority to regulate•or enforce against.any and all.parties who,
caused or.contributed to.'.the contamination at the property. `Therefore:DENR cleanup
programs.ar.e free _to pursue any and all parties who..caused or contributed to the,
existing contamination at.the site. A,BFA only provides liability protection to'a
non-causative.redev6loper of"the property...' In fact;•the,BFA will require the,
developer to provide access to.the property'to any party.doing work under -another
DENR program, and the Brownfields Program has numerous.sites where another program,
is enforcing against a',responsible party,while.we.are working with the developer on
brownfields actions., The developer will -only be'required to make the property:"safe
for its intended`.re=use: That will not include cleanup'to unrestricted use`..•
standards, unles's.that is consistent with the developer's proposed use of the,
property.*//*
Furthermore, the brownfields agreement will..not change the prospective developerls
responsibility to obtain an and'all'DENR
P y y permits (e.g.,stormwater,'sediment.:
control, NPDES, etc.) required for its operations or activities on: site from the
appropriate DENR'agencies.; as required under applicable law.*/
The Program does not desire inundate all.regulatory entities with additional -:email
notices.unless you request'it./ *So; if you -would like.to•'be notified when this
project is deemed eligible to pursue a. brownfields'agreement, plea se:let me know.
*/*/Otherwise,' you will-not"be.notified until the point that there has been
adequate assessment�to determine, that.the site can be made safe.for the intended
reuse./*//.If you have any questions, please don't hesitate.to contact me.
**Sincerely, J.
Sandra.Moore*

Chowan Veneer Co. Brownfields Eligibility Notice
(� f pyo ec+ _k 09 053 _ 0s l
Subject: Chowan Veneer Co. Brownfields Eligibility Notice
From: Sandra Moore <[e-mail]>
Date: Mon, 14 Nov 2005 09:53:58 -0500
To: Andrew Pitner <[e-mail]>, "Ted.Bush" <"Ted.Bush"@ncmail.net>, JACK
BUTLER <[e-mail]>, DAVID LOWN <[e-mail]>, James
Bateson <[e-mail]>, CHARLOTTE JESNECK
<[e-mail]>, "James. C. Coffey" <[e-mail]>, Liz
Cannon <[e-mail]>, MIKE WILLIFORD <[e-mail]>,
JESSE WELLS <[e-mail]>, Doug Holyfield <[e-mail]>,
HELEN COTTON <[e-mail]>, BUD MCCARTY
<[e-mail]>, "Grover.Nicholson" <[e-mail]>, rob krebbs
<[e-mail]>, Coleen Sullins <[e-mail]>, david may
<[e-mail]>, lyn hardison <[e-mail]>, edythe mckinney
<[e-mail]>, scott bullock <[e-mail]>, John Powers
<[e-mail]>, rick shiver <[e-mail]>, ethan brown
<[e-mail]>, Mark Poindexter <[e-mail]>
CC: [e-mail], SANDRA MOORE <[e-mail]>,
DEXTER MATTHEWS <[e-mail]>, LINDA CULPEPPER
<[e-mail]>, Bruce Nicholson <[e-mail]>,
SHIRLEY LIGGINS <[e-mail]>
To DENR Cleanup Programs:
This is an internal courtesy notice to inform your program that the DENR
Brownfields Program has deemed the *Chowan Veneer Company property *eligible for
the Brownfields Program. A Letter of Eligibility (LOE) was sent on* November 10,
2005* to Southern Bank, as prospective developer (PD).
In an effort to determine what potential risks exist at the site and how the site
can be made suitable for the reuse intended by the PD, we are now reviewing all
available environmental reports pertaining to the* Chowan Veneer Company
property*. We are currently reviewing the following report:* October 10, 2005
Report of Contamination prepared by NorthEast Environmental. *we will also review
any available reports in the DWM's Central Office at 401 Oberlin.* *Should you
have any additional information regarding this site, located at *259 & 262 Coke
Avenue, Edenton, Chowan County*, please contact the me using the contact
information below.
It is important to note that a Brownfields Agreement (BFA) has no legal effect on
your agency's authority to regulate or enforce against any and all parties who
caused or contributed to the contamination at the property. /*/* Therefore DENR
cleanup programs are free to pursue any and all parties who caused or contributed
to the existing contamination at the site. */*/A BFA only provides liability
protection to a non -causative redeveloper of the property. In fact, the BFA will
require the developer to provide access to the property to any party doing work
under another DENR program, and the Brownfields Program has several sites where
another program is enforcing against a responsible party while we are working with
the developer on brownfields actions. The developer will only be required to make
the property safe for its intended re -use. That will not include cleanup to
unrestricted use standards, unless that is consistent with the developer's proposed
use of the property.
/*Furthermore, the brownfields agreement will not change the prospective
developer's responsibility to obtain any and all DENR permits (e.g. stormwater,
sediment control, NPDES, etc.) required for its operations or activities on site
from the appropriate DENR agencies, as required under applicable law.*/
On behalf of the Brownfields Program, thank you for your time and any information
1 of 2 11/14/2005 9:54 AM

Chowan Veneer Co. Brownfields Eligibility Notice
you can provide.
Sandra Moore
Sandra Moore
Brownfields Project Manager
Division of Waste Management
401 Oberlin Road Suite 150
Raleigh, NC 27605
[phone]
[phone] (fax)
[e-mail]
2 of 2 11/14/2005 9:54 AM