Exhibit 10.1
FEDERAL DEPOSIT INSURANCE CORPORATION
 
WASHINGTON, D.C.
 

 
)
 
In the Matter of
)
   
)
ORDER TO
OCONEE STATE BANK
)
CEASE AND DESIST
WATKINSVILLE, GEORGIA
)
FDIC-09-221b
  )  
(INSURED STATE NONMEMBER BANK)
 
)  

 
 
 
OCONEE STATE BANK, WATKINSVILLE, GEORGIA (“Bank”), having been advised of its
right to a Notice of Charges and of Hearing detailing the unsafe or unsound
banking practices and violations of law and/or regulations alleged to have been
committed by the Bank and of its right to a hearing on the alleged charges under
section 8(b)(1) of the Federal Deposit Insurance Act (“Act”), 12 U.S.C. §
1818(b)(1), and the Official Code of Georgia Annotated § 7-1-91, O.C.G.A. §
7-1-91 (1985), and having waived those rights, entered into a STIPULATION AND
CONSENT TO THE ISSUANCE OF AN ORDER TO CEASE AND DESIST (“CONSENT AGREEMENT”)
with a representative of the Legal Division for the Federal Deposit Insurance
Corporation (“FDIC”) and the Commissioner (“Commissioner”) for the State of
Georgia, Department of Banking and Finance (“Department”), dated August 6, 2009,
whereby solely for the purpose of this proceeding and without admitting or
denying the alleged charges of unsafe or unsound banking practices and
violations of law and/or regulations, the Bank consented to the issuance of an
ORDER TO CEASE AND DESIST (“ORDER”) by the FDIC and the Commissioner.
 
 

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The FDIC and the Commissioner considered the matter and determined that it had
reason to believe that the Bank had engaged in unsafe or unsound banking
practices and had committed violations of law and/or regulations. The FDIC and
the Commissioner, therefore, accepted the CONSENT AGREEMENT and issued the
following:
 
ORDER TO CEASE AND DESIST
 
IT IS HEREBY ORDERED, that the Bank, its institution-affiliated parties, as that
term is defined in section 3(u) of the Act, 12 U.S.C. § 1813(u), and its
successors and assigns cease and desist from the following unsafe and unsound
banking practices and violations of law and/or regulation:
(a)   Operating with a board of directors (“Board”) that has failed to provide
adequate direction to management of the Bank;
(b)   Operating with management whose policies and practices are detrimental to
the Bank and jeopardize the safety of its deposits;
(c)   Operating with insufficient equity capital and reserves in relation to the
volume and quality of assets held by the Bank;
(d)   Operating with an excessive level of adversely classified items;
(e)   Operating with inadequate provisions for liquidity and funds management;
(f)   Operating with hazardous loan underwriting and administration practices;
(g)   Operating in such a manner as to produce operating losses; and
(h)   Operating in apparent violation of laws, regulations, and/or statements of
policy as more fully described on pages 10 through 12 of the FDIC Report of
Examination dated March 16, 2009 (“ROE”).
IT IS FURTHER ORDERED, that the Bank, its institution-affiliated parties, and
its successors and assigns, take affirmative action as follows:
 

 
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BOARD OF DIRECTORS
 
1.            (a)    Beginning with the effective date of this ORDER, the Board
shall increase participation in the affairs of the Bank, assuming full
responsibility for the approval of sound policies, strategic plans, and budgets
for the supervision of all of the Bank’s activities, consistent with the role
and expertise commonly expected for directors of banks of comparable size. The
Board shall establish specific procedures designed to fully inform the Board
regarding the management, operation, and financial condition of the Bank at
regular intervals and in a consistent format. This participation shall include
meetings to be held no less frequently than monthly at which, at a minimum, the
following areas shall be reviewed and approved: reports of income and expenses;
new, overdue, renewed, extended, restructured, insider, non-accrual,
charged-off, and recovered loans; investment activity; operating policies;
personnel actions; audit and supervisory reports; and the minutes summarizing
individual committee meetings and actions. Board minutes shall be detailed,
maintained and recorded on a timely basis and shall document reviews and any
related actions, including the names of any dissenting directors.
 
(b)    Within 30 days from the effective date of this ORDER, the Board shall
establish a Board committee (“Directors’ Committee”), consisting of at least
four members, responsible for ensuring compliance with the ORDER, overseeing
corrective measures with respect to the ORDER, and reporting to the Board. Three
of the members of the Directors’ Committee shall not be officers of the Bank.
The Director’s Committee shall monitor compliance with this ORDER and, within 30
days from the effective date of this ORDER, and every 30 days thereafter, shall
submit a written report detailing the Bank’s compliance with this ORDER to the
Board, for review and consideration during its regularly scheduled meeting. Such
report and any discussion related to the report or the ORDER shall be recorded
in the appropriate minutes of the meeting of the Board and shall be retained in
the Bank’s records. Nothing contained herein shall diminish the responsibility
of the entire Board to ensure compliance with the provisions of this ORDER.
 
 
 
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MANAGEMENT
 
2.            (a)    Within 60 days from the effective date of this ORDER, the
Bank shall have and retain qualified management. Each member of management shall
have qualifications and experience commensurate with his or her duties and
responsibilities at the Bank. Each member of management shall be provided
appropriate written authority from the Board to implement the provisions of this
ORDER. At a minimum management shall include:
 
(i)  
a chief executive officer with proven ability in managing a bank of comparable
size and in effectively implementing lending, investment and operating policies
in accordance with sound banking practices;

 
(ii)  
a senior lending officer with a significant amount of appropriate lending,
collection, loan supervision and loan work-out experience for the type and
quality of the Bank’s loans, and experience in upgrading low quality loan
portfolio; and

 
(iii)  
a chief financial officer with a significant amount of appropriate experience in
managing the operations of a bank of similar size and complexity in accordance
with sound banking practices.

 
 4 -
 
 
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(b)            During the life of this ORDER, the Bank shall notify the FDIC’s
Atlanta Regional Director (“Regional Director”) and the Commissioner
(collectively the “Supervisory Authorities”), in writing, of the resignation or
termination of any of the Bank’s directors or senior executive officers. Prior
to the addition of any individual to the Board or the employment of any
individual as a senior executive officer, the Bank shall comply with the
requirements of section 32 of the Act, 12 U.S.C. § 1831(i), subpart F of Part
303 of the FDIC Regulations, 12 C.F.R. §§ 303.100-303.103 and any State
requirement for prior notification and approval. The notification shall include
a description of the background and experience of the individual(s) to be added
or employed and must be received at least 30 days before such addition or
employment is intended to become effective. The Bank may not add any individual
to its Board or employ any individual as an executive officer if the Regional
Director or Commissioner issues a notice of disapproval pursuant to section 32
of the FDI Act, 12 U.S.C. § 1831(i).
 
CAPITAL
 
3.            (a)    Within 90 days from the effective date of this ORDER, the
Bank shall obtain Tier 1 Capital in such amount as to equal or exceed eight
percent (8%) of the Bank’s total assets and total risk-based capital in such an
amount as to equal or exceed ten percent (10%) of the Bank’s total risk-weighted
assets. The Bank shall maintain these levels during the life of this ORDER.
 
(b)    The level of Tier 1 Capital and total risk-based capital to be maintained
during the life of this ORDER pursuant to subparagraph 3(a) shall be in addition
to a fully funded allowance for loan and lease losses (“ALLL”), the adequacy of
which shall be satisfactory to the Supervisory Authorities as determined at
subsequent examinations and/or visitations.
 

 
 
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(c)    Any increase in Tier 1 Capital necessary to meet the requirements of
Paragraph 3 of this ORDER may not be accomplished through a deduction from the
Bank’s ALLL. For purposes of this ORDER, the terms “Tier 1 Capital,” “total
risk-based capital,” “total assets,” and “total risk-weighted assets” shall have
the meanings ascribed to them in Part 325 of the FDIC Rules and Regulations, 12
C.F.R. Part 325.
 
CHARGE-OFF
 
4.             (a)    Within 10 days from the effective date of this ORDER, the
Bank shall eliminate from its books, by charge-off or collection, all assets or
portions of assets classified “Loss” and fifty percent (50%) of those assets
classified “Doubtful” in the ROE that have not been previously collected or
charged-off. If an asset classified “Doubtful” is a loan or a lease, the Bank
may, in the alternative, increase its ALLL by an amount equal to fifty percent
(50%) of the loan or lease classified as “Doubtful.”
 
(b)   Additionally, while this ORDER remains in effect, the Bank shall, within
30 days of the receipt of any future report of examination or visitation report
of the Bank from the Regional Director or the Commissioner, eliminate from its
books, by collection, charge-off, or other proper entries, the remaining balance
of any assets classified “Loss” and fifty percent (50%) of those classified
“Doubtful,” unless otherwise approved in writing by the Supervisory Authorities.
 
(c)   Elimination or reduction of assets through proceeds of other loans made by
the Bank is not considered collection for purposes this paragraph.
 
 
 
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REDUCTION OF CLASSIFIED ITEMS
 
5.          (a)    Within 60 days from the effective date of this ORDER, the
Bank shall formulate a written plan to reduce the Bank’s risk exposure in each
asset in excess of $500,000 classified as “Substandard” or “Doubtful” in the
ROE. In developing the plan mandated by this paragraph, the Bank shall, at a
minimum, and with respect to each adversely classified loan, review, analyze,
and document the financial position of the borrower, including source of
repayment, repayment ability, and alternative repayment sources, as well as the
value and accessibility of any pledged or assigned collateral, and any possible
actions to improve the Bank’s collateral position.
 
(b)    Within 60 days of the effective date of this ORDER, the Bank shall
formulate a written plan to reduce the aggregate balance of assets classified
“Substandard” and those classified “Doubtful” in the ROE in accordance with the
following schedule:
 
(i) 
Within 180 days from the effective date of this ORDER, the Bank shall reduce the
items classified “Substandard” or “Doubtful” in the ROE by twenty percent (20%);

 
(ii) 
Within 360 days from the effective date of this ORDER, the Bank shall reduce the
items classified “Substandard” or “Doubtful” in the ROE by forty percent (40%);

 
(iii) 
Within 540 days from the effective date of this ORDER, the Bank shall have
reduced the items classified “Substandard” or “Doubtful” in the ROE by sixty
percent (60%).

 
 
 
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(c)    The Bank shall immediately submit the plans required in subparagraphs
5(a) and 5(b) to the Supervisory Authorities for review and comment. Within 30
days from the receipt of any comment from the Supervisory Authorities, and after
due consideration of any recommended changes, the Bank shall approve the plans,
which approval shall be recorded in the minutes of the meeting of the Board.
Thereafter, the Bank shall implement and fully comply with the plans. Such plans
shall be monitored and progress reports thereon shall be submitted to the
Supervisory Authorities at 90-day intervals concurrently with the other
reporting requirements set forth in paragraph 19 of this ORDER.
 
(d)    The requirements of this paragraph are not to be construed as standards
for future operations of the Bank. Furthermore, the Bank shall eventually reduce
the total of all adversely classified assets. Reduction of these assets through
proceeds of other loans made by the Bank is not considered collection for the
purpose of this paragraph. As used in subparagraphs 5(a) through (c), the word
“reduce” means:
 
(i)
to collect;

 
(ii)
to charge off; or

 
(iii)
to sufficiently improve the quality of assets adversely classified to warrant
removing any adverse classification as determined by the Regional Director or
Commissioner.

 
NO ADDITIONAL CREDIT
 
6.             (a)    Beginning with the effective date of this ORDER, the Bank
shall not extend, directly or indirectly, any additional credit to, or for the
benefit of, any borrower who has a loan or other extension of credit from the
Bank that has been charged-off or classified, in whole or in part, “Loss” or
“Doubtful” and is uncollected. The requirements of this paragraph shall not
prohibit the Bank from renewing (after collection in cash of interest due from
the borrower) any credit already extended to any borrower.
 
 
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(b)           Additionally, during the life of this ORDER, the Bank shall not
extend, directly or indirectly, any additional credit to, or for the benefit of,
any borrower who has a loan or other extension of credit from the Bank that has
been classified, in whole or part, “Substandard” and is uncollected. The
requirements of this paragraph shall not prohibit the Bank from renewing (after
collection in cash of interest due from the borrower) any credit already
extended to any borrower.
 
(c)           Subparagraph 6(b) shall not apply if the Bank’s failure to extend
furthercredit to a particular borrower would be detrimental to the best
interests of the Bank. Prior to the extending of any additional credit pursuant
to this paragraph, either in the form of a renewal, extension, or further
advance of funds, such additional credit shall be approved by a majority of the
Board, or a designated committee thereof, who shall certify, in writing:
 
(i) 
why the failure of the Bank to extend such credit would be detrimental to the
best interests of the Bank;

 
(ii) 
that the extension of such credit would improve the Bank's position, including
an explanatory statement of how the Bank’s position would be improved; and

 
(iii) 
an appropriate work-out plan has been developed and will be implemented in
conjunction with the additional credit to be extended.

 
(d)           The signed certification shall be made a part of the minutes of
the Board or designated committee, and a copy of the signed certification shall
be retained in the borrower's credit file.
 
 
 
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LENDING PRACTICES
 
7.   Within 60 days from the effective date of this ORDER, the Bank shall
revise, adopt, and implement a written lending and collection policy to provide
effective guidance and control over the Bank’s lending function, which policy
shall include, at a minimum, revisions to address all items of criticism
enumerated within the ROE. Such policy and its implementation shall be in a form
and manner acceptable to the Supervisory Authorities as determined at subsequent
examinations and/or visitations.
 
CONCENTRATIONS OF CREDIT
 
8.   Within 60 days from the effective date of this ORDER, the Bank shall
perform a risk segmentation analysis with respect to the concentrations of
credit listed on pages 22 and 23 of the ROE. Concentrations should be stratified
as the Board deems appropriate, but shall include concentrations identified by
industry, geographic distribution, underlying collateral, direct or indirect
extensions of credit to or for the benefit of any borrowers dependent upon the
performance of a single developer or builder, and other asset groups that are
considered economically related. The Board should refer to the interagency
guidance on Concentrations in Commercial Real Estate Lending, Sound Risk
Management Practices, for information regarding risk segmentation analysis. A
copy of the analysis shall be provided to the Supervisory Authorities and the
Board shall develop a plan to reduce any segment of the portfolio which the
Supervisory Authorities deem to be an undue concentration of credit in relation
to the Bank’s Tier 1 Capital. The plan and it implementation shall be in a form
and manner acceptable to the Supervisory Authorities as determined at subsequent
examinations and/or visitations.
 
 
 
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SPECIAL MENTION
 
9.   Within 30 days from the effective date of the ORDER, the Bank shall develop
a plan to correct all deficiencies in the assets listed for “Special Mention.”
The Bank shall immediately submit the plan to the Supervisory Authorities for
review and comment. Within 30 days from receipt of any comment from the
Supervisory Authorities, and after due consideration of any recommended changes,
the Bank shall approve the plan, which approval shall be recorded in the minutes
of the Board meeting. Thereafter, the Bank shall implement and fully comply with
the plan.
 
ESTABLISH/MAINTAIN ALLOWANCE FOR
LOAN AND LEASE LOSSES
 
10.   Within 30 days from the effective date of this ORDER, the Board shall
review the adequacy of the ALLL and establish a comprehensive policy for
determining the adequacy of the ALLL. For the purpose of this determination, the
adequacy of the ALLL shall be determined after the charge-off of all loans or
other items classified "Loss.” The policy shall provide for a review of the ALLL
at least once each calendar quarter. Said review should be completed at least
ten (10) days prior to the end of each quarter, in order that the findings of
the Board with respect to the ALLL may be properly reported in the quarterly
Reports of Condition and Income. The review should focus on the results of the
Bank's internal loan review, loan and lease loss experience, trends of
delinquent and non-accrual loans, an estimate of potential loss exposure of
significant credits, concentrations of credit, and present and prospective
economic conditions. A deficiency in the ALLL shall be remedied in the calendar
quarter it is discovered, prior to submitting the Report of Condition, by a
charge to current operating earnings. The minutes of the Board meeting at which
such review is undertaken shall indicate the results of the review. The Bank’s
policy for determining the adequacy of the Bank’s ALLL and its implementation
shall be satisfactory to the Supervisory Authorities as determined at subsequent
examinations and/or visitations.
 
 
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PLAN TO IMPROVE EARNINGS
 
11.            (a)    Within 60 days from the effective date of this ORDER, the
Bank shall formulate and fully implement a written plan and a comprehensive
budget for all categories of income and expense. The plan and budget shall
include formal goals and strategies, consistent with sound banking practices and
taking into account the Bank’s other written policies, to improve the Bank’s net
interest margin, increase interest income, reduce discretionary expenses, and
improve and sustain earnings of the Bank. The plan shall include a description
of the operating assumptions that form the basis for and adequately support
major projected income and expense components. Thereafter, the Bank shall
formulate such a plan and budget by November 30 of each subsequent year.
 
(b)   The plan and budget required by this paragraph, and any subsequent
modification thereto, shall be acceptable to the Supervisory Authorities as
determined at subsequent examinations and/or visitations.
 
(c)   Following the end of each calendar quarter, the Board shall evaluate the
Bank’s actual performance in relation to the plan and budget required by this
paragraph and shall record the results of the evaluation, and any actions taken
by the Bank, in the minutes of the Board meeting at which such evaluation is
undertaken.
 
CASH DIVIDENDS
 
12.    The Bank shall not pay cash dividends without the prior written consent
of the Supervisory Authorities.
 
 
 
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ASSET/LIABILITY MANAGEMENT
 
13.            (a)    Within 60 days from the effective date of this ORDER, the
Board shall implement an asset/liability management policy which establishes an
acceptable range for the Bank’s net noncore funding dependence ratio, as
computed by the Uniform Bank Performance Report. The policy shall set forth
suitable benchmarks and timeframes for the reduction of this ratio to levels
that are consistent with prudent banking practices. To the extent such measures
have not previously been initiated, the Bank shall immediately initiate measures
detailed in the policy required by this paragraph to accomplish the objectives
set forth in the policy. The requirements of this paragraph shall not be
construed as standards for future operations, and the Bank’s net noncore funding
dependence ratio shall be maintained at a level consistent with safe and sound
banking practices. Such policy shall be submitted to the Supervisory Authorities
for review and approval, and its implementation shall be acceptable to the
Supervisory Authorities as determined at subsequent examinations and/or
visitations.
 
(b)    Within 60 days from the effective date of this ORDER, the Bank shall
review, and amend as necessary, the Bank’s written interest rate risk policy. At
a minimum, the policy shall include guidelines for the following:
 
(i) 
measures designed to control the nature and amount of interest rate risk the
Bank takes, including those that specify risk limits and define lines of
responsibilities and authority for managing risk;

(ii) 
a system for identifying and measuring interest rate risk, including a periodic
calculation to measure interest rate risk exposure at various time horizons and
compare to established target ratios;

 
 
 
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(iii) 
establish goals and strategies for reducing and managing the Bank’s interest
rate risk exposure;

(iv) 
a system for monitoring and reporting risk exposures; and

(v) 
a system for internal controls, review, and audit to ensure the integrity of the
overall management process.

 
(c)    Such policy and its implementation shall be in a form and manner
acceptable to the Supervisory Authorities as determined at subsequent
examinations and/or visitations.
 
LIQUIDITY CONTINGENCY FUNDING PLAN
 
14.   Within 60 days from the effective date of this ORDER, the Bank shall
develop or revise, adopt, and implement a written liquidity contingency funding
plan. The written liquidity contingency funding plan shall incorporate the
applicable guidance contained in Financial Institution Letter (FIL) 84-2008
dated August 26, 2008, entitled Liquidity Risk Management. The liquidity
contingency funding plan shall provide restrictions on the use of brokered and
internet deposits consistent with safe and sound banking practices. Such plan
shall be submitted to the Supervisory Authorities for review and approval, and
its implementation shall be in a form and manner acceptable to the Supervisory
Authorities.
 
BROKERED DEPOSITS
 
15.   During the life of this ORDER, the Bank shall not accept, renew, or
rollover brokered deposits without obtaining a brokered deposit waiver approved
by the FDIC pursuant to Section 29 of the Act, 12 U. S.C. § 1831 f. For purposes
of this ORDER, brokered deposits are defined as described in Section 337.6(a)(2)
of the FDIC’s Rules and Regulations, 12 C.F.R. § 337.6(a)(2) to include any
deposits funded by third-party agents or nominees for depositors, including
depositors managed by a trustee or custodian when each individual beneficial
interest is entitled to a right to federal deposit insurance.
 
 
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ELIMINATE/CORRECT ALL VIOLATIONS OF LAW
 
16.   Within 60 days from the effective date of this ORDER, the Bank shall take
all necessary steps, subject to safe and sound banking practices, to eliminate
and/or correct the violations of law set and contraventions of policy out on
pages 10 through 12 of the ROE. In addition, the Bank shall take all necessary
steps to ensure future compliance with all applicable laws, regulations, and
applicable policies.
 
DISCLOSURE
 
17.   Following the effective date of this ORDER, the Bank shall send to its
shareholders or otherwise furnish a description of this ORDER in conjunction
with the Bank's next shareholder communication. The description shall fully
describe the ORDER in all material respects. The description and any
accompanying communication, statement, or notice shall be sent to the FDIC,
Division of Supervision and Consumer Protection, Accounting and Securities
Disclosure Section, 550 17th Street, N.W., Washington, D.C. 20429 and the
Commissioner, Georgia Department of Banking and Finance, 2990 Brandywine Road,
Suite 200, Atlanta, Georgia 30341-5565 for review at least 20 days prior to
dissemination to shareholders. Any changes requested to be made by the FDIC and
the Commissioner shall be made prior to dissemination of the description,
communication, notice, or statement.
 
 
 
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PROGRESS REPORTS
 
18.    Within 30 days of the end of the first quarter following the effective
date of this ORDER and within 30 days of the end of each quarter thereafter, the
Bank shall furnish written progress reports to the Supervisory Authorities
detailing the form and manner of any actions taken, and the results thereof, to
secure compliance with this ORDER. Such written progress reports shall include a
copy of the Bank’s Reports of Condition and Income and shall provide cumulative
detail of the Bank’s progress toward achieving compliance with each provision of
the ORDER. Progress reports may be discontinued when the corrections required by
this ORDER have been accomplished and the Supervisory Authorities have, in
writing, released the Bank from making further reports.
 
This ORDER shall become effective immediately. The provisions of this ORDER
shall remain effective and enforceable except to the extent that, and until such
time as, any provisions of this ORDER shall have been modified, terminated,
suspended, or set aside by the FDIC. Pursuant to delegated authority.
 
Dated at Atlanta, Georgia, this 18th day of August, 2009.
 
 
 

 
/s/ Doreen R. Eberley
Acting Regional Director
Federal Deposit Insurance Corporation
Atlanta Regional Office
Division of Supervision and Consumer Protection

 
 
 
 

 
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The Georgia Department of Banking and Finance, having duly approved the
foregoing ORDER, and the Bank, through its Board, agree that the issuance of the
said ORDER by the FDIC shall be binding as between the Bank and the Georgia
Commissioner of Banking and Finance to the same degree and legal effect that
such ORDER would be binding on the Bank if the Department had issued a separate
ORDER that included and incorporated all of the provisions of the foregoing
ORDER, pursuant to section 7-1-91 of the Official Code of Georgia Annotated,
O.C.G.A. § 7-1-91 (1985).
 
Dated this 18th day of August, 2009.
 

 

 
/s/Robert M. Braswell
Commissioner
Department of Banking and Finance State of Georgia

 
 
 
 
 
 
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FEDERAL DEPOSIT INSURANCE CORPORATION
 
WASHINGTON, D.C.
 
 

 
)
 
In the Matter of
)
   
)
STIPULATION AND CONSENT
OCONEE STATE BANK
)
TO THE ISSUANCE OF AN
WATKINSVILLE, GEORGIA
)
ORDER TO CEASE AND DESIST
  )
(INSURED STATE NONMEMBER BANK)
 
)
FDIC-09-221b  

 
 
Subject to the acceptance of this STIPULATION AND CONSENT TO THE ISSUANCE OF AN
ORDER TO CEASE AND DESIST ("CONSENT AGREEMENT") by the Federal Deposit Insurance
Corporation ("FDIC"), it is hereby stipulated and agreed by and between a
representative of the Legal Division of the FDIC, a representative of the
Georgia Department of Banking and Finance ("DEPARTMENT") and Oconee State Bank,
Watkinsville, Georgia ("Bank"), through its board of directors, as follows.
 
1.   The Bank has been advised of its right to receive a written Notice of
Charges and of Hearing ("Notice") detailing the unsafe or unsound banking
practices and violations of law and/or regulations alleged to have been
committed by the Bank and of its right to a hearing on the alleged charges under
section 8(b)(1) of the Federal Deposit Insurance Act ("Act"), 12 U.S.C. §
1818(b)(1), and the FDIC's Rules of Practice and Procedure ("Rules"), 12 C.F.R.
Part 308, and has waived those rights.
 
2.   The Bank, solely for the purpose of this proceeding and without admitting
or denying any of the alleged charges of unsafe or unsound banking practices and
any violations of law and/or regulations, hereby consents and agrees to the
issuance of an ORDER TO CEASE AND DESIST ("ORDER") by the FDIC and the
DEPARTMENT in the form attached hereto.
 
 
 
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The Bank further stipulates and agrees that such ORDER shall become effective
immediately upon its issuance by the FDIC and the DEPARTMENT and be fully
enforceable by the FDIC pursuant to the provisions of section 8(i)(1) of the
Act, 12 U.S.C. § 1818(i)(1), and the Rules, and by the DEPARTMENT subject only
to the conditions set forth in paragraph 3 of this CONSENT AGREEMENT.
 
3.   In the event the FDIC accepts this CONSENT AGREEMENT and issues the ORDER,
it is agreed that no action to enforce said ORDER in the United States District
Court will be taken by the FDIC unless the Bank or any "institution-affiliated
party", as such term is defined in section 3(u) of the Act, 12 U.S.C. § 1813(u),
has violated or is about to violate any provision of the ORDER.
 
4.   The Bank hereby waives:
 
(a) 
the receipt of a written Notice;

 
(b)
all defenses to the charges to be set forth in the Notice;

 
(c) 
a hearing for the purpose of taking evidence regarding the allegations to be set
forth in the Notice;

 
(d) 
the filing of Proposed Findings of Fact and Conclusions of Law;

 
(e) 
a Recommended Decision of an Administrative Law Judge; and

 
(f)
exceptions and briefs with respect to such Recommended Decision. Dated: August
6, 2009

 
FEDERAL DEPOSIT INSURANCE CORPORATION
LEGAL DIVISION
 
BY:
 
/s/ Pratin  Vallabhaneni
Pratin  Vallabhaneni
Honors Attorney
 
 
 
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GEORGIA DEPARTMENT OF BANKING AND FINANCE
 
BY:
 
/s/ Robert M. Braswell
Robert M. Braswell
Commissioner
 
OCONEE STATE BANK WATKINSVILLE, GEORGIA
 
BY:
 
/s/ G. Robert Bishop
G. Robert Bishop
 
/s/ Jimmy L. Christopher
Jimmy L. Christopher
 
/s/ Douglas D. Dickens
Douglas D. Dickens
 
/s/ James Albert Hale
James Albert Hale
 
/s/ B. Amrey Harden
B. Amrey Harden
 
/s/ Henry C. Maxey
Henry C. Maxey
 
/s/ Ann B.Powers
Ann B. Powers
 
 
 
(continued on next page)
 
 
 
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/s/ Jerry K. Wages
Jerry K. Wages
 
/s/ Virginia S. Wells
Virginia S. Wells
 
/s/ Tom F. Wilson
Tom F. Wilson
 
 
 
THE BOARD OF DIRECTORS
 
 
 
 
 
 
 
 
 
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