8-K

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d) of

The Securities Exchange Act of 1934

Date of Report (Date of earliest event reported): October 21, 2011

Bank of Granite Corporation

(Exact name of registrant as specified in its charter)

Delaware	0-15956	56-1550545
(State or other jurisdiction of incorporation)	(Commission File Number)	(IRS Employer Identification No.)
P.O. Box 128 23 North Main Street Granite Falls, North Carolina		28630
(Address of principal executive offices)		(Zip Code)

Registrant’s telephone number, including area code: (828) 496-2000

N/A

(Former name or former address, if changed since last report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

¨ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

¨ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

¨ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

¨ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Item 2.01. Completion of Acquisition or Disposition of Assets.

On October 21, 2011, FNB United Corp., a North Carolina corporation (“FNB”), completed its previously announced acquisition of Bank of Granite Corporation, a Delaware corporation (the “Company”). Pursuant to the terms and conditions of the Agreement and Plan of Merger, dated as of April 26, 2011 (as amended, the “Merger Agreement”), by and among FNB, Gamma Merger Corporation, a Delaware corporation and a wholly owned subsidiary of FNB (“Merger Sub”) and the Company, Merger Sub merged with and into the Company, with the Company continuing as the surviving corporation and as a wholly owned subsidiary of FNB (the “Merger”).

Upon the closing of the Merger, each outstanding share of the Company’s common stock, par value $1.00 per share (the “Common Stock”), other than shares held by the Company, FNB or any of their respective wholly owned subsidiaries and other than shares owned in a fiduciary capacity or as a result of debts previously contracted, was converted into the right to receive 3.375 shares of FNB’s common stock. As a result of the Merger, FNB issued approximately 52.2 million shares of FNB common stock to the Company’s stockholders in the aggregate.

The foregoing description does not purport to be complete and is qualified in its entirety by reference to the Merger Agreement, which was included as Exhibit 2.1 to the Current Report on Form 8-K previously filed by the Company on April 27, 2011, and is incorporated by reference herein.

A copy of the press release dated October 24, 2011 announcing the completion of the Merger and the transactions related thereto and contemplated thereby, is attached as Exhibit 99.1 to this Current Report on Form 8-K, and is incorporated by reference herein.

Item 3.01. Notice of Delisting or Failure to Satisfy a Continued Listing Rule or Standard; Transfer of Listing.

Following the completion of the Merger, on October 21, 2011, the NASDAQ Stock Market (“Nasdaq”) filed with the Securities and Exchange Commission (the “SEC”) a Form 25 removing the Company’s Common Stock from listing on Nasdaq and registration under Section 12(b) of the Securities and Exchange Act of 1934, as amended (“Exchange Act”). Additionally, the Company intends to file with the SEC, approximately ten days after the filing of the Form 25, a Form 15 terminating the registration of the Company’s Common Stock under Section 12(g) of the Exchange Act and suspending reporting obligations under Section 15(d) of the Exchange Act with respect to the Common Stock, whereupon the Company will have no further reporting obligations under the Exchange Act.

Item 3.03. Material Modification to Rights of Security Holders.

As previously described in a Current Report on Form 8-K filed by the Company on October 18, 2011, the Merger Agreement was adopted by the Company’s stockholders at the special meeting of the stockholders held on October 18, 2011. As a result of the Merger, each share of Common Stock was converted into the right to receive 3.375 shares of FNB’s common stock. Following the completion of the Merger, the Common Stock, which traded under the symbol “GRAN,” ceased to be listed on Nasdaq. The information set forth in Items 2.01 and 3.01 of this Current Report on Form 8-K is incorporated by reference herein.

5.01. Changes in Control of Registrant.

Pursuant to the terms of the Merger Agreement, upon the closing of the Merger, the Company became a wholly owned subsidiary of FNB and, accordingly, a change in control of the Company occurred. The information set forth in Items 2.01 and 5.02 of this Current Report on Form 8-K is incorporated by reference herein.

Item 5.02. Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.

On October 21, 2011, immediately following the effective time of the Merger (the “Effective Time”) of the Company with and into Merger Sub, six directors of the Company – R. Scott Anderson, John N. Bray, Joseph D. Crocker, Leila N. Erwin, Paul M. Fleetwood III, and Hugh R. Gaither – resigned as members of the board of directors of the Company. None of the directors resigned from the board of directors because of any disagreements relating to the Company’s operations, policies or practices.

Following the director resignations described above, the following individuals were elected as directors of the Company to hold such office until each such individual’s successor is duly elected and qualified or as otherwise provided by the bylaws of the Company:

Austin A. Adams (Chairman)

John J. Bresnan

Scott B. Kauffman

Jerry R. Licari

J. Chandler Martin

Robert L. Reid

Louis A. “Jerry” Schmitt

Brian E. Simpson

Also on October 21, 2011, immediately following the Effective Time, R. Scott Anderson, President, Secretary and Chief Executive Officer of the Company and the Bank of Granite, and Jerry A. Felts, Chief Financial Officer and Chief Operating Officer of the Company and the Bank of Granite, resigned, effective immediately.

Following the resignations of Messrs. Anderson and Felts, the following individuals were appointed to hold the principal office indicated opposite his name, effective immediately, to hold such office until each such individual’s successor is duly elected and qualified or as otherwise provided by the bylaws of the Company:

Brian E. Simpson	Chief Executive Officer
Robert L. Reid	President
David L. Nielsen	Chief Financial Officer and Executive Vice President

The biographical information for each of Messrs. Simpson, Reid and Nielsen is set forth on page 76 of the previously filed joint proxy statement/prospectus dated September 15, 2011, relating to the Registration Statement on Form S-4, as amended (File No. 333-176357) filed by FNB, and is incorporated herein by reference.

Item 5.03. Amendments to Articles of Incorporation or Bylaws; Change in Fiscal Year.

Pursuant to the Merger Agreement, immediately upon the consummation of the Merger, the certificate of incorporation of the Company was amended and restated in its entirety. Additionally, pursuant to the Merger Agreement, the bylaws of the Company were amended and restated in their entirety. Copies of the amended and restated certificate of incorporation of the Company and the amended and restated bylaws of the Company are filed as Exhibits 3.1 and 3.2 to this Current Report on Form 8-K, respectively, and are incorporated by reference herein.

Item 9.01. Financial Statements and Exhibits.

(d) Exhibits

No.	Description
3.1	Amended and Restated Certificate of Incorporation of Bank of Granite Corporation
3.2	Amended and Restated By-Laws of Bank of Granite Corporation
99.1	Press Release, dated October 24, 2011

SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, as amended, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

	Bank of Granite Corporation
	(Registrant)
October 27, 2011	/s/ Brian E. Simpson
(Date)	Brian E. Simpson Chief Executive Officer

INDEX TO EXHIBITS

No.	Description
3.1	Amended and Restated Certificate of Incorporation of Bank of Granite Corporation
3.2	Amended and Restated By-Laws of Bank of Granite Corporation
99.1	Press Release, dated October 24, 2011

EX-3.1

Exhibit 3.1

AMENDED AND RESTATED

CERTIFICATE OF INCORPORATION

OF

BANK OF GRANITE CORPORATION

FIRST. The name of the corporation is Bank of Granite Corporation (the “Corporation”).

SECOND. The address of the Corporation’s registered office in the State of Delaware is 160 Greentree Drive, Suite 101, in the City of Dover, in the County of Kent, Zip Code 19904. The name of the Corporation’s registered agent at such address is National Registered Agents, Inc.

THIRD. The purpose of the Corporation is to engage in any lawful act or activity for which corporations may be organized under the General Corporation Law of the State of Delaware (the “DGCL”).

FOURTH. 1. Common Stock. The total number of shares of all classes of stock which the Corporation shall have authority to issue is 100 shares of Common Stock, par value $1.00 per share (the “Common Stock”). All shares of Common Stock will be identical and will entitle the holders thereof to the same rights and privileges.

2. Voting Rights. The holders of Common Stock will be entitled to one vote per share on all matters to be voted on by the Corporation’s stockholders, except as otherwise required by law. There shall be no cumulative voting.

3. Dividends. Dividends may be declared and paid on the Common Stock from funds lawfully available therefore as and when determined by the Board of Directors, subject to any provision of this Certificate of Incorporation, as it may be amended from time to time.

4. Liquidation Rights. In the event of any liquidation, dissolution or winding up of the Corporation, whether voluntary or involuntary, the holders of the Common Stock shall be entitled to share, ratably according to the number of shares of Common Stock held by them, in the remaining assets of the Corporation available for distribution to its stockholders.

FIFTH. To the fullest extent permitted by the DGCL as the same now exists or may hereafter be amended, a director of the Corporation shall not be liable to the Corporation or its stockholders for monetary damages for breach of fiduciary duties as a director. Any repeal or modification of this Article Fifth shall not adversely affect any right or protection of a director existing at the time of such repeal or modification.

SIXTH. The Board of Directors, acting by majority vote, is expressly authorized to adopt, amend or repeal the bylaws of the Corporation.

SEVENTH. To the fullest extent permitted by the General Corporation Law of Delaware, as the same exists or may hereafter be amended, a director of this corporation shall not be liable to the corporation or its stockholders for monetary damages for breach of fiduciary duty as a director. Any repeal or modification of this section by stockholders of the corporation shall be prospective only, and shall not adversely affect any limitation on the personal liability of a director of the corporation existing at the time of such repeal or modification. In the event any litigation is brought against a director of the Corporation, authorization is hereby made to advance all expenses needed by the director to defend the lawsuit. There shall be no obligation to repay the expenses forwarded, unless it shall be ultimately determined by the corporation that the director shall not be entitled to indemnification.

EIGHTH. The Corporation reserves the right to amend, alter, change or repeal any provision contained in this Certificate of Incorporation, in the manner now or hereafter prescribed by statute, and all rights conferred upon stockholders herein are subject to this reservation.

EX-3.2

Exhibit 3.2

AMENDED AND RESTATED BY-LAWS

of

BANK OF GRANITE CORPORATION

(hereinafter, the “Corporation”)

ARTICLE I

OFFICES

Section 1. Registered Office. The registered office of the Corporation in the State of Delaware, as set forth in the Certificate of Incorporation, shall be established and maintained at The Corporation Trust Company, 1209 Orange Street, Wilmington, Delaware, 19801, County of New Castle. The name of the registered agent of the Corporation at such address shall be The Corporation Trust Company.

Section 2. Other Offices. The Corporation may also have offices at such other places both within and without the State of Delaware as the Board of Directors may from time to time determine.

ARTICLE II

MEETING OF STOCKHOLDERS

Section 1. Place of Meetings. Meetings of the stockholders for the election of directors or for any other purpose shall be held at such time and place, either within or without the State of Delaware, as shall be designated from time to time by the Board of Directors and stated in the notice of the meeting or in a duly executed waiver of notice thereof.

Section 2. Annual Meetings. The Annual Meeting of Stockholders shall be held on such date and at such time as shall be designated from time to time by the Board of Directors and stated in the notice of the meeting, at which meeting the stockholders shall elect a Board of Directors by a plurality vote, and transact such other business as may properly be brought before the meeting.

1

Section 3. Special Meetings. Special Meetings of Stockholders, for any purpose or purposes, may be called by the President, Secretary or Treasurer, and shall be called by any such officer at the request in writing of a majority of the Board of Directors. Such request shall state the purpose or purposes of the proposed meeting.

Section 4. Notice of Meetings. Written notice of an Annual Meeting or Special Meeting stating the place, date, and hour of the meeting and in the case of a Special Meeting, the purpose or purposes for which the meeting is called, shall be given not less than ten nor more than sixty days before the date of the meeting to each stockholder entitled to vote at such meeting.

Section 5. Quorum. Except as otherwise provided by law or by the Certificate of Incorporation, the holders of a majority of the capital stock issued and outstanding and entitled to vote thereat, present in person or represented by proxy, shall constitute a quorum at all meetings of the stockholders for the transaction of business. If, however, such quorum shall not be present or represented at any meeting of the stockholders, the stockholders entitled to vote thereat, present in person or represented by proxy, shall have power to adjourn the meeting from time to time, without notice other than announcement at the meeting, until a quorum shall be present or represented.

Section 6. Voting. Any questions brought before any meeting of stockholders shall be decided by a majority vote of the number of shares entitled to vote, present in person or represented by proxy. Such votes may be cast in person or by proxy, but no proxy shall be voted on or after three years from its date, unless such proxy provides for a longer period.

Section 7. Action by Consent. Any action required to be taken at any annual or special meeting of stockholders, or any action which may be taken at any annual or special meeting of such stockholders, may be taken without a meeting, without prior notice and without a vote, if a consent in writing shall be signed by the holders of outstanding stock having not less than the minimum number of votes that would be necessary to authorize or take such action at a meeting at which all shares entitled to vote thereon were present and voted. Prompt notice of the taking of the corporate action without a meeting by less than unanimous written consent shall be given to those stockholders who have not consented in writing.

ARTICLE III

DIRECTORS

Section 1. Number and Election of Directors. The number of directors that shall constitute the Board of Directors shall be not less than one nor more than fifteen. The initial directors shall be determined by resolution of the sole incorporator of the Corporation or the Board of Directors, as the case may be. Thereafter, within the limits specified above, the number of directors shall be determined by the Board of Directors or by the stockholders. Except as provided in Section 2 of this Article, directors shall be elected by a plurality of the votes cast at Annual Meetings of Stockholders, and each director so elected shall hold office until the next Annual Meeting and until his successor is duly elected and qualified, or until his earlier resignation or removal.

2

Section 2. Vacancies. Vacancies and newly created directorships resulting from any increase in the authorized number of directors may be filled by the stockholders, a majority vote of all directors, or by a sole remaining director, and the directors so chosen shall hold office until the next annual election and until their successors are duly elected and qualified, or until their earlier resignation or removal.

Section 3. Committees. The Board of Directors may designate one or more committees, which committees shall, to the extent provided in the resolution of the Board of Directors establishing such a committee, have all authority and may exercise all the powers of the Board of Directors in the management of the business and affairs of the Corporation to the extent lawful under the General Corporation Law of the State of Delaware.

Section 4. Duties and Powers. The business of the Corporation shall be managed by or under the direction of the Board of Directors which may exercise all such powers of the Corporation and do all such lawful acts and things as are not by statute or by the Certificate of Incorporation or by these Bylaws directed or required to be exercised or done by the stockholders.

Section 5. Meetings. The Board of Directors of the Corporation may hold meetings, both regular and special, either within or without the State of Delaware. Regular meetings of the Board of Directors may be held without notice at such time and at such place as may from time to time be determined by the Board of Directors. Special meetings of the Board of Directors may be called by the president or any one director with one day’s notice to each director, either personally or by mail, telephone or facsimile transmission.

Section 6. Quorum; Board Action. Except as may be otherwise specifically provided by law, the Certificate of Incorporation or these Bylaws, at all meetings of the Board of Directors, a majority of the entire Board of Directors shall constitute a quorum for the transaction of business, and the act of a majority of the entire Board of Directors shall be the act of the Board of Directors. If a quorum shall not be present at any meeting of the Board of Directors, the directors present thereat may adjourn the meeting from time to time, without notice other than announcement at the meeting, until a quorum shall be present.

Section 7. Actions of Board. Unless otherwise provided by the Certificate of Incorporation or these Bylaws, any action required or permitted to be taken at any meeting of the Board of Directors or of any committee thereof may be taken without a meeting, if all the members of the Board of Directors or committee, as the case may be, consent thereto in writing, and the writing or writings are filed with the minutes of proceedings of the Board of Directors or committee.

3

Section 8. Compensation. The Corporation shall reimburse the reasonable expenses incurred by members of the Board of Directors in connection with attendance at meetings of the Board of Directors and of any committee on which such member serves; provided, that the foregoing shall not preclude any director from serving the Corporation in any other capacity and receiving compensation therefore.

Section 9. Removal. Unless otherwise restricted by the Certificate of Incorporation or by law, any director or the entire Board of Directors may be removed, with or without cause, by the holders of a majority of shares entitled to vote at an election of directors.

ARTICLE IV

OFFICERS

The officers of the Corporation shall consist of a President, a Secretary, a Treasurer and such other additional officers with such titles as the Board of Directors shall determine, all of whom shall be chosen by and shall serve at the pleasure of the Board of Directors. Such officers shall have the usual powers and shall perform all the usual duties incident to their respective offices. All officers shall be subject to the supervision and direction of the Board of Directors. The authority, duties or responsibilities of any officer of the Corporation may be suspended by the President with or without cause. Any officer elected or appointed by the Board of Directors may be removed by the Board of Directors with or without cause.

ARTICLE V

NOTICES

Section 1. Notices. Whenever written notice is required by law, the Certificate of Incorporation or these Bylaws, to be given to any director, member of a committee or stockholder, such notice may be given by mail, addressed to such director, member of a committee or stockholder, at his address as it appears on the records of the Corporation, with postage thereon prepaid, and such notice shall be deemed to be given at the time when the same shall be deposited in the United States mail. Written notice may also be given personally or by telephone, electronic mail or facsimile transmission.

Section 2. Waivers of Notice. Whenever any notice is required by law, the Certificate of Incorporation or these Bylaws, to be given to any director, member of a committee or stockholder, a waiver thereof in writing, signed by the person entitled to notice, whether before or after the time stated therein, shall be deemed equivalent to notice. Attendance of a person at a meeting shall constitute a waiver of notice of such meeting, except when the person attends a meeting for the express purpose of objecting, at the beginning of the meeting, to the transaction of any business because the meeting is not lawfully called or convened.

4

ARTICLE VI

GENERAL PROVISIONS

Section 1. Dividends. Dividends upon the capital stock of the Corporation, subject to the provisions of the Certificate of Incorporation, may be declared by the Board of Directors at any regular or special meeting, and may be paid in cash, in property, or in shares of the capital stock. Before payment of any dividend, there may be set aside out of any funds of the Corporation available for dividends such sum or sums as the Board of Directors from time to time, in its absolute discretion, deems proper as a reserve or reserves to meet contingencies, or for equalizing dividends, or for repairing or maintaining any property of the Corporation, or for any proper purpose, and the Board of Directors may modify or abolish any such reserve.

Section 2. Fiscal Year. The fiscal year of the Corporation shall be fixed by resolution of the Board of Directors.

Section 3. Corporate Seal. The corporate seal shall have inscribed thereon the name of the Corporation, the year of its organization and the words “Corporate Seal, Delaware”. The seal may be used by causing it or a facsimile thereof to be impressed or affixed or reproduced or otherwise.

ARTICLE VII

INDEMNIFICATION OF OFFICERS AND DIRECTORS

Section 1. Right to Indemnification. Each person who was or is made a party or is threatened to be made a party to or is otherwise involved in any action, suit or proceeding, whether civil, criminal, administrative or investigative, by reason of the fact that he is or was a director or an officer of the Corporation or is or was serving at the request of the Corporation as a director, officer, employee or agent of another corporation or of a partnership, joint venture, trust or other enterprise, including service with respect to an employee benefit plan (hereinafter an “Indemnitee”), whether the basis of such proceeding is alleged action in an official capacity as a director, officer, employee or agent or in any other capacity while serving as a director, officer, employee or agent, shall be indemnified and held harmless by the Corporation to the fullest extent authorized by the Delaware General Corporation Law, as the same exists or may hereafter be amended (but, in the case of any such amendment, only to the extent that such amendment permits the Corporation to provide broader indemnification rights than such law permitted the Corporation to provide prior to such amendment), against all expense, liability and loss (including attorneys’ fees, judgments, fines, ERISA excise taxes or penalties and amounts paid in settlement) reasonably incurred or suffered by such Indemnitee in connection therewith; provided, however, that, except as provided in Section 3 of this Article with respect to proceedings to enforce rights to indemnification, the Corporation shall indemnify any such Indemnitee in connection with a proceeding (or part thereof) initiated by such Indemnitee only if such proceeding (or part thereof) was authorized by the board of directors of the Corporation.

5

Section 2. Right to Advancement of Expenses. The right to indemnification conferred in Section 1 of this Article shall include the right to be paid by the Corporation the expenses (including attorney’s fees) incurred in defending any such proceeding in advance of its final disposition; provided, however, that, if the Delaware General Corporation Law requires, an advancement of expenses incurred by an Indemnitee in his capacity as a director or officer (and not in any other capacity in which service was or is rendered by such Indemnitee, including, without limitation, service to an employee benefit plan) shall be made only upon delivery to the Corporation of an undertaking, by or on behalf of such Indemnitee, to repay all amounts so advanced if it shall ultimately be determined by final judicial decision from which there is no further right to appeal that such Indemnitee is not entitled to be indemnified for such expenses under this Section 2 or otherwise. Such undertaking shall be an unlimited, unsecured general obligation of the Indemnitee, and shall be accepted without reference to such Indemnitee’s ability to make repayment. The rights to indemnification and to the advancement of expenses conferred in Sections 1 and 2 of this Article shall be contract rights and such rights shall continue as to an Indemnitee who has ceased to be a director, officer, employee or agent and shall inure to the benefit of the Indemnitee’s heirs, executors and administrators. Any repeal or modification of any of the provisions of this Article shall not adversely affect any right or protection of an Indemnitee existing at the time of such repeal or modification.

Section 3. Right of Indemnitees to Bring Suit. If a claim under Section 1 or 2 of this Article is not paid in full by the corporation within sixty (60) days after a written claim has been received by the Corporation, except in the case of a claim for an advancement of expenses, in which case the applicable period shall be twenty (20) days, the Indemnitee may at any time thereafter bring suit against the Corporation to recover the unpaid amount of the claim. If successful in whole or in part in any-such suit, or in a suit brought by the Corporation to recover an advancement of expenses pursuant to the terms of an undertaking, the Indemnitee shall also be entitled to be paid the expenses of prosecuting or defending such suit. In (i) any suit brought by the Indemnitee to enforce a right to indemnification hereunder (but not in a suit brought by the Indemnitee to enforce a right to an advancement of expenses) it shall be a defense that, and (ii) in any suit brought by the Corporation to recover an advancement of expenses pursuant to the terms of an undertaking, the Corporation shall be entitled to recover such expenses upon a final adjudication that, the Indemnitee has not met any applicable standard for indemnification set forth in the Delaware General Corporation Law. Neither the failure of the corporation (including its board of directors, independent legal counsel, or its stockholders) to have made a determination prior to the commencement of such suit that indemnification of the Indemnitee is proper in the circumstances because the Indemnitee has met the applicable standard of conduct set forth in the Delaware General Corporation Law, nor an actual determination by the Corporation (including its board of directors, independent legal counsel, or its stockholders) that the Indemnitee has not met such applicable standard of conduct, shall create a presumption that the Indemnitee has not met the applicable standard of conduct or, in the case of such a suit brought by the Indemnitee, be a defense to such suit. In any suit brought by the Indemnitee to enforce a right to indemnification or to an advancement of expenses hereunder, or brought by the Corporation to recover an advancement of expenses pursuant to the terms of an undertaking, the burden of proving that the Indemnitee is not entitled to be indemnified, or to such advancement of expenses, under this Article or otherwise shall be on the Corporation. The termination of a

6

proceeding by judgment, order, settlement, conviction, or upon a plea of nolo contendere or its equivalent shall not of itself create a presumption that an Indemnitee acted in such a manner as to make him or her ineligible for indemnification.

Section 4. Non-Exclusivity of Rights. The rights to indemnification and to the advancement of expenses conferred in this Article shall not be exclusive of any other right which any person may have or hereafter acquire under any statute, the Corporation’s Certificate of Incorporation as amended from time to time, these By-laws, any agreement, any vote of stockholders or disinterested directors or otherwise. However, no person shall be entitled to indemnification by the Corporation by virtue of the fact that such person is actually indemnified by another entity, including an insurer.

Section 5. Insurance. The Corporation may maintain insurance, at its expense, to protect itself and any director, officer, employee or agent of the Corporation or another corporation, partnership, joint venture, trust or other enterprise against any expense, liability or loss, whether or not the Corporation would have the power to indemnify such person against such expense, liability or loss under the Delaware General Corporation Law.

Section 6. Indemnification of Employees and Agents of the Corporation. The Corporation may, to the extent authorized from time to time by the board of directors, grant rights of indemnification and the advancement of expenses to any employee or agent of the Corporation to the fullest extent of the provisions of this Article with respect to the indemnification and advancement of expenses of directors and officers of the Corporation.

ARTICLE VIII

AMENDMENTS

These Bylaws may be altered, amended or repealed, in whole or in part, or new Bylaws may be adopted by the majority vote of the entire Board of Directors.

Entire Board of Directors. As used in this Article VIII and in these Bylaws generally, the term “entire Board of Directors” means the total number of the directors which the Corporation would have if there were no vacancies.

Adopted by the Board of Directors: October 21, 2011

7

EX-99.1

Exhibit 99.1

For Immediate Release October 24, 2011 For More Information Mark Brock (704) 926-1305 mbrock@wrayward.com   John Mader (704) 926-1316 jmader@wrayward.com

FNB United Corp. • PO Box 1328, Asheboro, NC 27204 • 150 S. Fayetteville Street, Asheboro, NC 27203

FNB United Corp. Completes Acquisition of Bank of Granite Corporation

$310 Million Recapitalization Consummated

Banks to Operate Separately Until Spring 2012

ASHEBORO, N.C., (Oct. 24, 2011) – FNB United Corp. (Nasdaq: FNBN), parent company of CommunityONE Bank, N.A., today announced that it has completed the acquisition of Bank of Granite Corporation (Nasdaq: GRAN), parent company of Bank of Granite, and consummated a $310 million recapitalization. The two banks will operate separately until late spring of 2012 when, subject to receipt of regulatory approval, it is anticipated the consolidation process will be completed and will thereafter operate solely as CommunityONE Bank.

“This is truly an unprecedented historic event for community banking in North Carolina,” said Brian Simpson, the new CEO of FNB United. “We have successfully raised sufficient capital to restore two 100-year-old banking companies simultaneously. By combining them under one organization we have the opportunity to again be an economic driver in the communities we serve.”

The combination of FNB United and Bank of Granite has resulted in a North Carolina community banking organization with approximately $2.8 billion in assets, $2.4 billion in deposits and 63 full-service banking offices located in some of the state’s most robust markets. Asheboro will serve as the corporate headquarters and central operations center.

Simpson and Bob Reid, the new president of FNB United, led a successful $310 million recapitalization of FNB United, which paved the way for its acquisition of Bank of Granite and for the recapitalization of both banks. Lead investors in the recapitalization are The Carlyle Group and Oak Hill Capital Partners, each having invested approximately $79 million.

1

“Our primary goals right now are exemplary customer service and a smooth transition for our people,” Reid said. “FNB United and Bank of Granite employees have been re-energized, and we are all focused on accomplishing our mission.”

In addition to Simpson and Reid, FNB United and Bank of Granite will now be led by a seasoned management team that includes David Nielsen, (senior manager, KPMG; chief operating officer, Wachovia/Wells Fargo), chief financial officer; David Lavoie (senior risk manager, Bank of America), chief credit officer; Greg Murphy (FDIC liquidator, senior risk manager, Bank of America), chief workout officer; and Angus McBryde (treasury and balance sheet manager, Wachovia), treasurer.

The new management team, which averages 26 years of banking experience, is supported by a new board of directors that includes Austin Adams (chief information officer, JP Morgan Chase, BankOne and First Union), chair; Jerry Licari (national banking practice leader, KPMG), chair, audit committee; Chan Martin (treasurer and senior risk executive, Bank of America), chair, risk committee; and Jerry Schmitt, (asset/liability committee chairman, First Union), chair, compensation committee. The new board also includes a representative from each lead investor, and two FNB United and one Bank of Granite legacy board members.

“The closing of this transaction was achieved due to the dedicated efforts and cooperation of everyone involved – our investors, advisors and the leadership and shareholders of FNB United and Bank of Granite,” Simpson said. “We all share a common mission of assuring that community banking remains strong in North Carolina, serving individuals, families and businesses in their own hometowns.”

The Transaction

The merger agreement provided that Bank of Granite shareholders received 3.375 shares of FNB United Corp.’s common stock in exchange for each share of Bank of Granite Corporation common stock they owned immediately prior to completion of the merger. FNB United shareholders will continue to own their existing shares of FNB United common stock after the merger and the recapitalization. No earlier than January 1, 2012, FNB United will distribute to each record holder of FNB United common stock as of the close of business on October 20, 2011, non-transferable warrants to purchase from FNB United one share of common stock for each four shares of FNB United common stock held by such holder as of the close of business on October 20, 2011 at a purchase price of $0.16 per share.

2

Sandler O’Neill + Partners and Raymond James & Associates, Inc. acted as financial advisors to FNB United, and Keefe, Bruyette & Woods, Inc. acted as financial advisor to Bank of Granite Corporation. Arnold & Porter LLP and Shell Bray Aycock Abel & Livingston PLLC served as legal counsel for FNB United, Parker Poe served as legal counsel for Bank of Granite Corporation and Simpson Thacher & Bartlett served as legal counsel for The Carlyle Group and Oak Hill Capital Partners.

About FNB United Corp.

FNB United Corp. is the Asheboro, N.C.-based bank holding company for CommunityONE Bank, N.A. and Bank of Granite. Opened in 1907, CommunityONE Bank operates 45 offices in 38 communities throughout central, southern and western North Carolina, and offers a complete line of consumer, mortgage and business banking services, including loan, deposit, cash management, wealth management and internet banking services. Founded in 1906, Bank of Granite operates 18 full-service banking offices in seven North Carolina counties—Burke, Caldwell, Catawba, Iredell, Mecklenburg, Watauga and Wilkes.

Forward-Looking Statements

This news release may contain forward-looking statements regarding future events. Forward-looking statements often address our expected future business and financial performance, and often contain words such as “expect,” “anticipate,” “intend,” “plan,” “believe,” “seek,” or “will.” These statements are only predictions and are subject to risks and uncertainties that could cause the actual events or results to differ materially. These risks and uncertainties include risks of managing our growth, changes in financial markets, changes in real estate markets, regulatory changes, changes in interest rates, changes in economic conditions being less favorable than anticipated, and loss of deposits and loan demand to other financial institutions. Additional information concerning factors that could cause actual results to be materially different from those in the forward-looking statements is contained in FNB United’s filings with the Securities and Exchange Commission. FNB United does not assume any obligation to update these forward-looking statements or to update the reasons why actual results could differ from those projected in the forward-looking statements.

#  #  #

3