Exhibit 10.1

UNITED STATES OF AMERICA

BEFORE THE

BOARD OF GOVERNORS OF THE FEDERAL RESERVE SYSTEM

WASHINGTON, D.C.

 

Written Agreement by and between

 

AB&T FINANCIAL CORPORATION

Gastonia, North Carolina

 

and

 

FEDERAL RESERVE BANK OF

RICHMOND

Richmond, Virginia

 

 

Docket No. 12-031-WA/RB-HC

WHEREAS, AB&T Financial Corporation, Gastonia, North Carolina (“AB&T”), a
registered bank holding company, owns and controls Alliance Bank & Trust
Company, Gastonia, North Carolina (the “Bank”), a state-chartered nonmember
bank;

WHEREAS, it is the common goal of AB&T and the Federal Reserve Bank of Richmond
(the “Reserve Bank”) to maintain the financial soundness of AB&T so that AB&T
may serve as a source of strength to the Bank;

WHEREAS, AB&T and the Reserve Bank have mutually agreed to enter into this
Written Agreement (the “Agreement”); and

WHEREAS, on April 24, 2012, the board of directors of AB&T, at a duly
constituted meeting, adopted a resolution authorizing and directing Wayne F.
Shovelin to enter into this Agreement on behalf of AB&T, and consenting to
compliance with each and every provision of this Agreement by AB&T and its
institution-affiliated parties, as defined in sections 3(u) and 8(b)(3) of the
Federal Deposit Insurance Act, as amended (the “FDI Act”) (12 U.S.C. §§ 1813(u)
and 1818(b)(3)).

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NOW, THEREFORE, AB&T and the Reserve Bank agree as follows:

Source of Strength

1. The board of directors of AB&T shall take appropriate steps to fully utilize
AB&T’s financial and managerial resources, pursuant to section 38A of the FDI
Act (12 U.S.C. § 1831o-1) and section 225.4(a) of Regulation Y of the Board of
Governors of the Federal Reserve System (the “Board of Governors”) (12 C.F.R. §
225.4(a)), to serve as a source of strength to the Bank, including, but not
limited to, taking steps to ensure that the Bank complies with the Consent Order
entered into with the Federal Deposit Insurance Corporation and the State of
North Carolina Commissioner of Banks on February 1, 2012 and any other
supervisory action taken by the Bank’s federal or state regulator.

Dividends

2. (a) AB&T shall not declare or pay any dividends without the prior written
approval of the Reserve Bank and the Director of the Division of Banking
Supervision and Regulation of the Board of Governors.

(b) AB&T shall not directly or indirectly take dividends or any other form of
payment representing a reduction in capital from the Bank without the prior
written approval of the Reserve Bank.

(c) All requests for prior approval shall be received by the Reserve Bank at
least 30 days prior to the proposed dividend declaration date. All requests
shall contain, at a minimum, current and projected information on AB&T’s
capital, earnings, and cash flow; the Bank’s capital, asset quality, earnings,
and allowance for loan and lease losses; and identification of the sources of
funds for the proposed payment. AB&T must also demonstrate that the requested
declaration or payment of dividends is consistent with the Board of Governors’
Policy Statement on the Payment of Cash Dividends by State Member Banks and Bank
Holding Companies, dated November 14, 1985 (Federal Reserve Regulatory Service,
4-877 at page 4-323).

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Debt and Stock Redemption

3. (a) AB&T shall not, directly or indirectly, incur, increase, or guarantee any
debt without the prior written approval of the Reserve Bank. All requests for
prior written approval shall contain, but not be limited to, a statement
regarding the purpose of the debt, the terms of the debt, and the planned
source(s) for debt repayment, and an analysis of the cash flow resources
available to meet such debt repayment.

(b) AB&T shall not, directly or indirectly, purchase or redeem any shares of its
stock without the prior written approval of the Reserve Bank.

Affiliate Transactions

4. (a) AB&T shall take all necessary actions to ensure that the Bank complies
with sections 23A and 23B of the Federal Reserve Act and Regulation W of the
Board of Governors (12 C.F.R. Part 223) in all transactions between the Bank and
its affiliates, including but not limited to AB&T and any nonbank subsidiary.

(b) For the purpose of this paragraph, the terms: (i) “transaction” shall
include, but not limited to, the transfer, contribution, sale or purchase of any
Bank asset, the direct or indirect payment of any AB&T expense or obligation, or
the direct or indirect assumption of any AB&T liability, the payment by the Bank
of a management or service fee of any nature to AB&T, or any extension of credit
by the Bank to AB&T, including overdrafts; and (ii) “extension of credit” shall
be defined as set forth in section 215.3 of Regulation O of the Board of
Governors (12 C.F.R. 215.3).

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(c) AB&T and any nonbank subsidiary shall not cause the Bank to violate any
provision of sections 23A and 23B of the Federal Reserve Act or Regulation W of
the Board of Governors.

(d) Within 30 days of this Agreement, AB&T shall submit to the Reserve Bank an
acceptable written plan to reimburse the Bank for the loan made by the Bank to
AB&T, consistent with the Boards’ Policy Statement on Diversion of Bank Income
by Parent BHC, dated March 19, 1979 (SR Letter 79-533). The plan shall specify
the amount(s) to be paid to the Bank, the method used to calculate the amount of
repayment including interest, and a schedule for when the payment(s) will be
made.

Compliance with Laws and Regulations

5. (a) In appointing any new director or senior executive officer, or changing
the responsibilities of any senior executive officer so that the officer would
assume a different senior executive officer position, AB&T shall comply with the
notice provisions of section 32 of the FDI Act (12 U.S.C. § 1831i) and Subpart H
of Regulation Y of the Board of Governors (12 C.F.R. §§ 225.71 et seq.).

(b) AB&T shall comply with the restrictions on indemnification and severance
payments of section 18(k) of the FDI Act (12 U.S.C. § 1828(k)) and Part 359 of
the Federal Deposit Insurance Corporation’s regulations (12 C.F.R. Part 359).

Progress Reports

6. Within 30 days after the end of each calendar quarter following the date of
this Agreement, the board of directors shall submit to the Reserve Bank written
progress reports detailing the form and manner of all actions taken to secure
compliance with the provisions of this Agreement and the results thereof, and a
parent company only balance sheet, income statement, and, as applicable, report
of changes in stockholders’ equity.

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Communications

7. All communications regarding this Agreement shall be sent to:

 

  (a) Ms. Joan T. Garton

Vice President

Federal Reserve Bank of Richmond

P.O. Box 27622

Richmond, Virginia 23261-7622

 

  (b) Mr. Daniel C. Ayscue

President and Chief Executive Officer

AB&T Financial Corporation

P.O. Box 1099

Gastonia, North Carolina 28053

Miscellaneous

8. Notwithstanding any provision of this Agreement, the Reserve Bank may, in its
sole discretion, grant written extensions of time to AB&T to comply with any
provision of this Agreement.

9. The provisions of this Agreement shall be binding upon AB&T and its
institution affiliated parties, in their capacities as such, and their
successors and assigns.

10. Each provision of this Agreement shall remain effective and enforceable
until stayed, modified, terminated, or suspended in writing by the Reserve Bank.

11. The provisions of this Agreement shall not bar, estop, or otherwise prevent
the Board of Governors, the Reserve Bank, or any other federal or state agency
from taking any other action affecting AB&T, the Bank, any nonbank subsidiary of
AB&T, or any of their current or former institution-affiliated parties and their
successors and assigns.

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12. Pursuant to section 50 of the FDI Act (12 U.S.C. § 1831aa), this Agreement
is enforceable by the Board of Governors under section 8 of the FDI Act (12
U.S.C. § 1818).

IN WITNESS WHEREOF, the parties have caused this Agreement to be executed as of
the 7th day of May, 2012.

 

AB&T FINANCIAL CORPORATION     FEDERAL RESERVE BANK OF RICHMOND By:  

/s/ Wayne F. Shovelin

    By:  

/s/ Joan T. Garton

  Wayne F. Shovelin       Joan T. Garton   Chairman       Vice President