Exhibit 10.1
 
AGREEMENT BY AND BETWEEN
The First National Bank of Ottawa
Ottawa, Illinois
and
The Comptroller of the Currency
 
    The First National Bank of Ottawa, Ottawa, Illinois ("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
loan risk ratings and the Allowance for Loan and Lease Loss methodology, as well
as violations of law at the Bank.
 
    In consideration of the above premises, 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)(l).
 
    (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)(l) and 12 U.S.C. § 1818(i)(2).
 

 
 

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    (3)         This Agreement shall be construed to be a "formal written
agreement" within the meaning of 12 C.P.R. §§ 5.3(g)(4) and 5.51(c)(6)(ii).  See
12 U.S.C. § 1831i.
 
    (4)         This Agreement shall be construed to be a "written agreement"
within the meaning of 12 U.S.C. § 1818(u)(l)(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:
 
       Assistant Deputy Comptroller
       Peoria Field Office
       211 Fulton Street, Suite 604
      Peoria, IL 61602
 
ARTICLE II
 
EXTENSIONS OF CREDIT TO INSIDERS
 
(1)   The Bank is prohibited from making  an extension of credit, including the
payment of overdrafts, directly or indirectly to any insider  unless the
extension of credit is:
 

  (a) approved in advance  by a majority  of the entire  Board, not merely a
quorum thereof, with any interested insider  abstaining from voting  and
participation directly  or indirectly in the deliberations regarding the
approval; and          (b)  the Board has determined in writing  that it is
advantageous for the Bank to engage  in such action,  and that the action
complies with all applicable laws, rules, regulations, and Comptroller's
issuances, including, but not limited  to 12 U.S.C. §§ 375a and 375b, and 12
C.P.R. Part 215.  Approval of an extension of credit to an insider noted in
Board minutes does not fulfill the written requirements of this paragraph (1).

 
 
 

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    (2)           For purposes of this Article, "insider'' and "extension of
credit" shall  have  the same  meanings as set forth  in 12 C.P.R.§§ 215.2(h)
and 215.3, respectively.
 
ARTICLE III
 
LOAN RISK RATING SYSTEM
 
    (1)   Within ninety (90) days, and on an ongoing basis  thereafter, the
Board  must ensure that the Bank's internal risk ratings of commercial or
agricultural credit relationships (covered relationship), as assigned by
responsible loan officers and by any independent loan reviewer, are timely,
accurate, and consistent with the regulatory credit classification criteria set
forth  in the Rating Credit Risk Booklet, A-RCR, of the Comptroller's Handbook.
At a minimum, the Board must ensure, on an ongoing basis, that with respect to
the assessment of credit risk of any covered relationship:
 
 

  (a) the primary consideration is the strength of the borrower's primary source
of repayment (i.e., the probability of default rather than  the risk of loss);  
      (b) if the primary source of repayment is cash  flow  from  the borrower's
operations, the determination of the strength of the borrower's cash  flow is
limited to analysis of the borrower's historical and projected financial
statements, past performance, and future prospects in light  of conditions that
have  occurred;         (c) collateral, non-government guarantees, and
other  similar credit  risk mitigants that affect  potential loss in the
event  of default (rather than  the probability of default) are taken into
consideration only  if the primary source of repayment has weakened and the
probability of default has increased;      

 
 
 

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  (d) collateral values should reflect a current assessment of value  based  on
actual  market conditions and project status;         (e) credit  risk ratings
are reviewed and updated whenever relevant new information is received, but no
less frequently than annually; and         (f) the credit  risk rating  analysis
is documented and available for review by the Board  and the OCC  upon  request.

 
    (2)           Within ninety (90)  days,  and on an ongoing basis thereafter,
the Board  must  ensure that any covered relationship with a high probability of
payment default or other  well­  defined weakness is rated  no better  than
Substandard, unless the debt is secured by marketable securities or
cash.   Consistent with  the guidance in the Rating Credit Risk  Booklet, A-RCR,
of the Comptroller's Handbook, the presence of illiquid collateral or existence
of a plan for improvement does not, and a non-government guarantee generally
will not, mitigate the probability of default or a well-defined weakness.
 

ARTICLE IV
 
ALLOWANCE FOR  LOAN AND  LEASE LOSSES
 
    (1)            Within ninety (90) days,  the Board  shall  adopt  or revise,
implement, and thereafter ensure adherence to written policies and procedures
for maintaining an adequate Allowance for Loan  and Lease Losses ("ALLL") in
accordance with  U.S. generally accepted accounting principles ("GAAP").  The
ALLL policies and procedures shall  be consistent with  the guidance set
forth  in the Federal Financial Institutions Examination Council's "Interagency
Policy Statement on the Allowance for Loan  and Lease  Losses" dated  December
13, 2006,  (OCC Bulletin 2006-47) ("Interagency Statement") and shall  at a
minimum include:

 
 

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  (a) procedures for determining whether a loan  is impaired and measuring the
amount of impairment, consistent with GAAP (including FASB ASC  310-0,
Receivables- Overall- Subsequent Measurement  Impairment);         (b)
procedures for segmenting the loan  portfolio and estimating loss on groups of
loans  that are consistent with  GAAP (including FASB ASC  450-20,
Loss Contingencies). These procedures shall require the Bank to incorporate
annualized year-to-date credit losses into each  quarterly analysis and document
its estimation of credit losses and its analysis of the nine qualitative factors
set forth  in the Interagency Statement;         (c) procedures for validating
the ALLL methodology         (d) a process for summarizing and documenting, for
the Board's prior  review and approval, the amount to be reported in the
Consolidated Reports of Condition and Income for the ALLL.      

 
    (2)    The Board shall  adopt  or revise, implement, and thereafter ensure
adherence to written policies and procedures to ensure that all official and
regulatory reports filed  by the Bank accurately reflect an adequate
ALLL  balance as of the date that such  reports are submitted.
 
ARTICLE V
 
OTHER PROVISIONS
 

    (1)    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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    (2)    Any  time limitations imposed  by this Agreement shall begin to run
from the effective date ofthis Agreement. Such time requirements may be extended
in writing by the Assistant  Deputy Comptroller for good cause upon written
application by the Board.
 
    (3)    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.
 
    (4)    In each instance  in this Agreement in which the Board is
required  to ensure adherence  to, and undertake to perform  certain obligations
of the Bank, it is intended  to mean that the Board shall:
 

  (a) authorize  and adopt such actions on behalf of the Bank as may be
necessary for the Bank to perform its obligations and undertakings under the
terms of this Agreement;         (b) require the timely  reporting  by Bank
management of such actions directed by the Board to be taken under the terms of
this Agreement;         (c) follow-up on any non-compliance with such
actions  in a timely and appropriate manner; and         (e) require corrective
action be taken in a timely  manner  of any non­compliance with such actions.

 
 
 

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    (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)(l), and expressly does  not fom1, 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)(l), 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.
 
IN TESTIMONY WHEREOF, the undersigned, authorized by the Comptroller, has
hereunto set his hand on behalf of the Comptroller.
 

     
/s/ Gary L. Baranowski
  5-22-12 Gary L. Baranowski   Date Assistant Deputy Comptroller     Peoria
Field Office    

 
 

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

     
/s/ Bradley J. Armstrong
  5-16-12 Bradley J. Armstrong   Date

 

     
/s/ Joachim J. Brown
  5-16-12 Joachim J. Brown   Date

 

     
/s/ John L. Cantlin
  5-16-12 John L. Cantlin   Date

 

     
/s/ Donald J. Harris
  5-16-12 Donald J. Harris   Date

 

     
/s/ Thomas P. Rooney
  5-16-12 Thomas P. Rooney   Date

 

     
/s/ William J. Walsh
  5-16-12 William J. Walsh   Date

 

     
/s/ Brian Zabel
  5-16-12 Brian Zabel   Date

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