CALHOUN FIRST NATIONAL BANK At a meeting with Bert Lance, President of Calhoun First National Bank, yesterday for approximately 2 hours at Calhoun, Georgia, and after a discussion of outstanding loans secured by stock of Bert Lance and LaBelle Lance, Bert volunteered that by January 31, 1971 he would reduce the total outstanding indebtedness at least $275,000.00 with the idea of a reasonable amortization schedule over the next few years. Lance has agreed that we will meet sometime in February and outline a program satisfactory to this bank. We should shortly receive from him a letter to this effect including a current up-todate financial statement. A discussion was had in great detail regarding various loans that Fulton has handled and is handling for Calhoun without any compensating balances; and in fact, over the past eight months the Calhoun account has produced no profit with average collected balances being only around $125,000.00 for the period. Copies of our analysis and computations of what we expect from a bank where substantial loan accommodations are extended were left with Bert. He indicated that he had no idea the account was in this shape, and he promised immediate action to correct this. I also left with Lance some analysis information that we had prepared on his delinquent accounts and his installment paper in comparison with national averages and the results of our analysis of our own loans which by no means were we proud of. Lance was left with data reflecting since the date of our $3,000,000.00 participation in his installment loans that outstanding together with his runoffs were $1,500,000.00. Again we emphasized he should take steps to curtail this sizable monthly increase. I feel the visit was fruitful; and in addition, Lance is concerned about the continuing problems he is having with both the software and hardware of his computer. I believe Calhoun First National has sustained at least a $100,000.00 loss, and he would like for our people to come up and advise with them. I believe that if we so desire, he would gladly come back on our system. I have informed both Mr. Jones and Bill Waller of my conversation. 9-10-70 JWC:jm A -- Ex. 10 CALHOUN FIRST NATIONAL BANK Calhoun, Georgia Wallace Carpenter and I had a nice visit with Bert Lance regarding the Fed Funds owed 1. Mr. Lance has not entered into the internal operation of any bank other 2. He will furnish us a monthly statement of Calhoun First National. 4. He will discontinue Fed Funds borrowings except on a limited number 5. If free bonds are available he would probably want to establish a portion 6. We are told that book value of Calhoun stock is approximately 7 to 8, a share and should be approximately same for 1974. Atkins Henderson 7. Mr. Lance has indicated that he hopes to pay a minimum of $100,000 11-11-74 JLPhillips Mr. Lance called on approximately Nov. 26 and said he had been in the hospital with an infected jaw and had not been able to get any of the above items accomplished. He wanted to let us know, however, that it was not his intention to delay any longer than necessary. He would tak to Atkins Henderson and get back in touch. Lamar Harrison called approximately December 2 and said that they had discussed tank's loan with us and Fed Funds and felt if they could borrow $5,000,000 instead of the present $3,000, GCO they would not have to resort to Fed Funds at all and it would allow them to keep better balances. A Ex. 10 Calhoun First National Bank - Page 2 He suggested that they thought they would be able to repay it about $500,000 a month. He was to get back in touch with me when they decided definitely what they could repay and we would draw a loan agreement; and I agreed to the $5,000,000 participation in their instalment loans. December 5, I called Bert Lance about his loan and individual loans of others and about the additional collateral on his loan. He told me that LaBelle's brother had died in Jefferson City, Missouri and they had been up there the past week and he would get to work right away on it and get his additional collateral to us and talk to the other borrowers about a method of repayment. We also discussed the interest rate that some of the individuals were paying, and he would also bring this up with them. Mr. Lance was in today and agreed to give us additional collateral on his personal loan. I have asked him to give us adequate amount so our loan will not exceed two times book value. The five million dollar loan to the bank was handled today. We reviewed all the individual loans that are secured by Calhoun, Chatsworth, and Ringgold bank stock and will follow these out. 12-12-74 JLPhillips ======== Called today to see when Mr. Lance was going to send the additional collateral to find that he was out of the State until next Monday. 12-19-74 JLPhillips ================ Our $5million participation in Calhoun First National's instalment loans paid out in full today. 1-15-75 JLPhillips A -- Ex. 10 |