Exhibit 10.1
 
AGREEMENT BY AND BETWEEN
First National Bank of Georgia
Carrollton, GA
and
The Comptroller of the Currency
 
First National Bank of Georgia, Carrollton, GA (“Bank”) and the Comptroller of
the Currency of the United States of America (“Comptroller”) wish to protect the
interests of the depositors, other customers, and shareholders of the Bank, and,
toward that end, wish the Bank to operate safely and soundly and in accordance
with all applicable laws, rules and regulations.
 
The Comptroller has found unsafe and unsound banking practices relating to the
levels of concentrations and classified assets of construction, acquisition and
development lending in the bank’s loan portfolio.
 
In consideration of the above premises, it is agreed, between the Bank, by and
through its duly elected and acting Board of Directors (“Board”), and the
Comptroller, through his authorized representative, that the Bank shall operate
at all times in compliance with the articles of this Agreement.
 
ARTICLE I
 
JURISDICTION
 
(1) This Agreement shall be construed to be a “written agreement entered into
with the agency” within the meaning of 12 U.S.C. § 1818(b)(1).
 
(2) This Agreement shall be construed to be a “written agreement between such
depository institution and such agency” within the meaning of 12 U.S.C. §
1818(e)(1) and 12 U.S.C. § 1818(i)(2).
 
(3) This Agreement shall be construed to be a “formal written agreement” within
the meaning of 12 C.F.R. § 5.51(c)(6)(ii). See 12 U.S.C. § 1831i.

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(4) This Agreement shall be construed to be a “written agreement” within the
meaning of 12 U.S.C. § 1818(u)(1)(A).
 
(5) All reports or plans which the Bank or Board has agreed to submit to the
Assistant Deputy Comptroller pursuant to this Agreement shall be forwarded to:
 
James F. DeVane, Jr.
Assistant Deputy Comptroller
Georgia Field Office
3 Ravinia Drive, Suite 550
Atlanta, GA 30346
 
ARTICLE II
 
COMPLIANCE COMMITTEE
 
(1) Within fifteen (15) days of the date of this Agreement, the Board shall
appoint a Compliance Committee of at least seven (7) directors, of which no more
than two (2) shall be an employee or controlling shareholder of the Bank or any
of its affiliates (as the term “affiliate” is defined in 12 U.S.C. §
371c(b)(1)), or a family member of any such person. Upon appointment, the names
of the members of the Compliance Committee and, in the event of a change of the
membership, the name of any new member shall be submitted in writing to the
Assistant Deputy Comptroller. The Compliance Committee shall be responsible for
monitoring and coordinating the Bank’s adherence to the provisions of this
Agreement.
 
(2) The Compliance Committee shall meet at least monthly.
 
(3) Within forty-five (45) days of the date of this Agreement and every quarter
thereafter, the Compliance Committee shall submit a written progress report to
the Board setting forth in detail:
 

 
(a)
a description of the action needed to achieve full compliance with each Article
of this Agreement;

 

 
(b)
actions taken to comply with each Article of this Agreement; and

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(c)
the results and status of those actions.

 
(4) The Board shall forward a copy of the Compliance Committee’s report, with
any additional comments by the Board, to the Assistant Deputy Comptroller within
ten (10) days of receiving such report.
 
ARTICLE III
 
ACTION PLAN
 
(1) Within forty five (45) days, the Board shall adopt, implement, and
thereafter ensure Bank adherence to a written action plan detailing the Board’s
assessment of what needs to be done to improve the Bank, specifying how the
Board will implement the plan, and setting forth a timetable for the
implementation of the plan.
 
(2) Upon completion of the plan, the Board shall submit the plan to the
Assistant Deputy Comptroller for review and prior written determination of no
supervisory objection. Upon receiving a determination of no supervisory
objection, the Bank shall implement and adhere to the plan.
 
(3) In the event the Assistant Deputy Comptroller recommends changes to the
action plan, the Board shall immediately incorporate those changes into the
plan.
 
(4) The plan shall be implemented pursuant to the time frames set forth within
the plan unless events dictate modifications to the plan. Where the Board
considers modifications appropriate, those modifications shall be submitted to
the Assistant Deputy Comptroller for prior written determination of no
supervisory objection. Upon receiving a determination of no supervisory
objection from the Assistant Deputy Comptroller, the Bank shall implement and
adhere to the plan.

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ARTICLE IV
 
CONCENTRATIONS OF CREDIT
 
(1) Within forty-five (45) days, the Board shall adopt, implement, and
thereafter ensure Bank adherence to a written asset diversification program. The
program shall include, but not necessarily be limited to, the following:
 

 
(a)
an update to the Bank’s regular review of the balance sheet to identify any
concentrations of credit;

 

 
(b)
an update to the Bank’s routine written analysis of any concentration of credit
identified above in order to identify and assess the inherent credit, liquidity,
and interest rate risk;

 

 
(c)
a review of current policies and procedures to control and monitor
concentrations of credit; and

 

 
(d)
an action plan approved by the Board to reduce the risk of any concentration
deemed imprudent in the above analysis.

 
(2) For purposes of this Article, a concentration of credit is as defined in the
“Loan Portfolio Management” booklet of the Comptroller’s Handbook.
 
(3) A copy of the plan shall be submitted to the Assistant Deputy Comptroller
for review and prior written determination of no supervisory objection. Upon
receiving a determination of no supervisory objection from the Assistant Deputy
Comptroller, the Bank shall implement and adhere to the program.
 
(4) The Board shall continue to ensure that future concentrations of credit are
subjected to the analysis required by subparagraph (b) and that the analysis
demonstrate that the concentration will not subject the Bank to undue credit or
interest rate risk.

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(5) The Board shall forward a copy of any analysis performed on existing or
potential concentrations of credit to the Assistant Deputy Comptroller
immediately following the review.
 
ARTICLE V
 
CRITICIZED ASSETS
 
(1) The Bank shall continue to take action to protect its interest in those
assets criticized in the ROE, in any subsequent Report of Examination, by
internal or external loan review, or in any list provided to management by the
National Bank Examiners.
 
(2) Within ninety (90) days, the Board shall adopt, implement, and thereafter
ensure Bank adherence to a written program designed to eliminate the basis of
criticism of assets criticized in the ROE, in any subsequent Report of
Examination, or by any internal or external loan review, or in any list provided
to management by the National Bank Examiners as “doubtful,” “substandard,” or
“special mention.” This program shall include, at a minimum:
 

 
(a)
an identification of the expected sources of repayment;

 

 
(b)
the appraised value of supporting collateral and the position of the Bank’s lien
on such collateral where applicable;

 

 
(c)
an analysis of current and satisfactory credit information, including cash flow
analysis where loans are to be repaid from operations; and

 

 
(d)
the proposed action to eliminate the basis of criticism and the time frame for
its accomplishment.

 
(3) Upon adoption, a copy of the program for all criticized assets equal to or
exceeding one million dollars ($1MM) shall be forwarded to the Assistant Deputy
Comptroller for review and prior written determination of no supervisory
objection. Upon receiving a determination of no supervisory objection from the
Assistant Deputy Comptroller, the Bank shall implement and adhere to the
program.

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(4) The Board shall ensure that the Bank has processes, personnel, and control
systems to ensure implementation of and adherence to the program developed
pursuant to this Article.
 
(5) The Executive Loan Committee of the Board shall continue to conduct a
review, on at least a quarterly basis, to determine:
 

 
(a)
the status of each criticized asset or criticized portion thereof that equals or
exceeds one million dollars ($1MM);

 

 
(b)
management’s adherence to the program adopted pursuant to this Article;

 

 
(c)
the status and effectiveness of the written program; and

 

 
(d)
the need to revise the program or take alternative action.

 
(6) A copy of each review shall be forwarded to the Assistant Deputy Comptroller
on a quarterly basis (in a format similar to Appendix A, attached hereto).
 
(7) The Bank may extend credit, directly or indirectly, including renewals,
extensions or capitalization of accrued interest, to a borrower whose loans or
other extensions of credit are criticized in the ROE, in any subsequent Report
of Examination, in any internal or external loan review, or in any list provided
to management by the National Bank Examiners and whose aggregate loans or other
extensions exceed five hundred thousand ($500M) only if each of the following
conditions is met:
 

 
(a)
the Board or designated committee finds that the extension of additional credit
is necessary to promote the best interests of the Bank and that prior to
renewing, extending or capitalizing any additional credit, a majority of the
full Board (or designated committee) approves the credit extension and records,
in writing, why such extension is necessary to promote the best interests of the
Bank; and

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(b)
a comparison to the written program adopted pursuant to this Article shows that
the Board’s formal plan to collect or strengthen the criticized asset will not
be compromised.

 
(8) A copy of the approval of the Board or of the designated committee shall be
maintained in the file of the affected borrower.
 
ARTICLE VI
 
LOAN WORKOUT DEPARTMENT
 
(1) Within sixty (60) days, the Board shall establish a Loan Workout Department
for the purpose of restoring and reclaiming classified assets, including
commercial real estate loans.
 
(2) Within sixty (60) days, the Board shall identify and employ an individual
with demonstrated experience and skills in managing a bank workout program to
manage the Loan Workout Department. This individual shall report to the Chief
Executive Officer of the Bank and shall be independent of the Bank’s credit
origination function.
 
(3) The Loan Workout Department shall take all steps necessary to improve the
operation of the Bank’s workout function including, but not limited to:
 

 
(a)
the establishment of policies and procedures to distinguish assets that shall be
managed by the Loan Workout Department from assets that shall be managed by the
originating unit;

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(b)
the establishment of policies and procedures to require assets that remain with
the originating unit are managed according to the standards of the Loan Workout
Department;

 

 
(c)
the development and implementation of management information systems to track
workloads and staffing requirements within the Loan Workout Department; and

 

 
(d)
the development and implementation of management information systems to measure
the success of workout activities.

 
(4) The Board shall ensure that the Loan Workout Department receives staffing
and funding support necessary to maintain its sound operation.
 
ARTICLE VII
 
BUDGET/BUSINESS PLAN
 
(1) Within ninety (90) days, the Board shall update, implement, and thereafter
ensure Bank adherence to a written three-year business plan that shall include a
projection of major balance sheet and income statement components, and shall
provide for injections of equity capital, as necessary. The business plan shall
also include a written profit plan and a detailed budget. Specifically, the plan
shall describe the Bank’s objectives for improving Bank earnings, contemplated
strategies and major capital expenditures required to achieve those objectives.
Such strategies shall include specific market segments that the Bank intends to
promote or develop. Procedures shall also be established to monitor the Bank’s
actual results against these projections and to provide for appropriate
adjustments to the budget and profit plan. The plan shall set forth specific
time frames for the accomplishment of these objectives.

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ARTICLE VIII
 
PROGRESS REPORTING - QUARTERLY
 
(1) The Board shall submit quarterly progress reports to the Assistant Deputy
Comptroller, Georgia Field Office, 3 Ravinia Drive, Suite 550, Atlanta, GA
30346. These reports shall set forth in detail:
 

 
(a)
actions taken to comply with each Article of the Agreement;

 

 
(b)
results of those actions; and

 

 
(c)
a description of the actions needed to achieve full compliance with each Article
of this Agreement.

 
(2) The progress reports shall also include any actions initiated by the Board
and the Bank pursuant to the criticisms and comments in the Report of
Examination or in any future Report of Examination.
 
(3) The first progress report shall be submitted for the period ending December
31, 2008 and will be due within fifteen (15) days of that date. Thereafter,
progress reports will be due within fifteen (15) days after the quarter end.
 
ARTICLE IX
 
CLOSING
 
(1) Although the Board has agreed to submit certain programs and reports to the
Assistant Deputy Comptroller for review or prior written determination of no
supervisory objection, the Board has the ultimate responsibility for proper and
sound management of the Bank.
 
(2) It is expressly and clearly understood that if, at any time, the Comptroller
deems it appropriate in fulfilling the responsibilities placed upon him by the
several laws of the United States of America to undertake any action affecting
the Bank, nothing in this Agreement shall in any way inhibit, estop, bar, or
otherwise prevent the Comptroller from so doing.

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(3) Any time limitations imposed by this Agreement shall begin to run from the
effective date of this Agreement. Such time requirements may be extended in
writing by the Assistant Deputy Comptroller for good cause upon written
application by the Board.
 
(4) The provisions of this Agreement shall be effective upon execution by the
parties hereto and its provisions shall continue in full force and effect unless
or until such provisions are amended in writing by mutual consent of the parties
to the Agreement or excepted, waived, or terminated in writing by the
Comptroller.
 
(5) This Agreement is intended to be, and shall be construed to be, a
supervisory “written agreement entered into with the agency” as contemplated by
12 U.S.C. § 1818(b)(1), and expressly does not form, and may not be construed to
form, a contract binding on the Comptroller or the United States.
Notwithstanding the absence of mutuality of obligation, or of consideration, or
of a contract, the Comptroller may enforce any of the commitments or obligations
herein undertaken by the Bank under his supervisory powers, including 12 U.S.C.
§ 1818(b)(1), and not as a matter of contract law. The Bank expressly
acknowledges that neither the Bank nor the Comptroller has any intention to
enter into a contract. The Bank also expressly acknowledges that no officer or
employee of the Office of the Comptroller of the Currency has statutory or other
authority to bind the United States, the U.S. Treasury Department, the
Comptroller, or any other federal bank regulatory agency or entity, or any
officer or employee of any of those entities to a contract affecting the
Comptroller’s exercise of his supervisory responsibilities. The terms of this
Agreement, including this paragraph, are not subject to amendment or
modification by any extraneous expression, prior agreements or prior
arrangements between the parties, whether oral or written.

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IN TESTIMONY WHEREOF, the undersigned, authorized by the Comptroller, has
hereunto set his hand on behalf of the Comptroller.
 
/s/ James F. Devane, Jr.
  November 12, 2008
James F. Devane, Jr.
 
Date
Assistant Deputy Comptroller
   
Georgia Field Office
   

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IN TESTIMONY WHEREOF, the undersigned, as the duly elected and acting Board of
Directors of the Bank, have hereunto set their hands on behalf of the Bank.

/s/ Wanda W. Calhoun   November 12, 2008
Wanda W. Calhounac
 
Date
      /s/ Grady W. Cole   November 12, 2008
Grady Woodfin Cole
 
Date
      /s/ Mary Covington   November 12, 2008
Mary Covington
 
Date
      /s/ Richard A. Duncan   November 12, 2008
Richard A. Duncan
 
Date
      /s/ Randall Eaves   November 12, 2008
Randall Eaves
 
Date
      /s/ W.T. Green, Jr.   November 12, 2008
W.T. (Tommy) Green, Jr.
 
Date
      /s/ Steven J. Haack   November 12, 2008
Steven J. Haack
 
Date
      /s/ Loy M. Howard   November 12, 2008
Loy M. Howard
 
Date
      /s/ Lynn Joiner   November 12, 2008
Lynn Joiner
 
Date
      /s/ H.B. (Rocky) Lipham, III   November 12, 2008
H.B. (Rocky) Lipham, III
 
Date
      /s/ Larry Mann   November 12, 2008
Larry Mann
 
Date
      /s/ Mark H. Murphy   November 12, 2008
Mark H. Murphy
 
Date
      /s/ R. David Perry   November 12, 2008
R. David Perry
 
Date

 
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/s/ Richard L. Plunkett   November 12, 2008
Richard L. Plunkett
 
Date
      /s/ Thomas E. Reeve, III   November 12, 2008
Thomas E. Reeve, III
 
Date
      /s/ Don C. Rhodes   November 12, 2008
Don C. Rhodes
 
Date
      /s/ Thomas T. Richards   November 12, 2008
Thomas T. Richards
 
Date
      /s/ Helen Tyus Roberts   November 12, 2008
Helen Tyus Roberts
 
Date
      /s/ William G. Sewell   November 12, 2008
William G. Sewell
 
Date
      /s/ William W. Stone   November 12, 2008
William W. Stone
 
Date
      /s/ Frank T. Thomasson, III   November 12, 2008
Frank T. (Tommy) Thomasson, III
 
Date
      /s/ J. Thomas Vance   November 12, 2008
J. Thomas Vance
 
Date
      /s/ Gelon Wasdin   November 12, 2008
Gelon Wasdin
 
Date
      /s/ Charles M. Willis, Sr.   November 12, 2008
Charles M. Willis, Sr.
 
Date

 
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APPENDIX A
First National Bank of Georgia
Carrollton, GA
 
CRITICIZED ASSET REPORT AS OF:
                                                                                                                                                       
0;
BORROWER(S):
ASSET BALANCE(S) AND OCC RATING (SM, SUBSTANDARD, DOUBTFUL OR LOSS):
$                                                                                     CRITICISM
                                                                           
AMOUNT CHARGED OFF TO
DATE                                                                           
 
FUTURE POTENTIAL
CHARGE-OFF                                                                           
 
PRESENT STATUS (Fully explain any increase in outstanding balance; include past
due status, nonperforming, significant progress or deterioration, etc.):
                                                                                                                                         
;            
 
FINANCIAL AND/OR COLLATERAL SUPPORT (include brief summary of most current
financial information, appraised value of collateral and/or estimated value and
date thereof, bank’s lien position and amount of available equity, if any,
guarantor(s) info, etc.):
                                                                                                                                         
;             
 
PROPOSED PLAN OF ACTION TO ELIMINATE ASSET CRITICISM(S) AND TIME FRAME FOR ITS
ACCOMPLISHMENT:
                                                                                                                                         
;             
 
IDENTIFIED SOURCE OF REPAYMENT AND DEFINED REPAYMENT PROGRAM (repayment program
should coincide with source of repayment):
                                                                                                                                         
;             
 
Use this form for reporting each criticized asset that exceeds one million
dollars ($1,000,000.00) and retain the original in the credit file for review by
the examiners. Submit your reports quarterly until notified otherwise, in
writing, by the Assistant Deputy Comptroller.
 

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