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   [10,816A] In the Matter of First American Bank, N.A., Washington, D.C., Docket No. 93-131kk (6-11-93).

   FDIC issues order conditionally granting approval for waiver of cross-guaranty.

   [.1] Cross-Guaranty—Waiver—Conditional on Acquisition

   [.2] Cross-Guaranty—Waiver—Applicability May Not be Conveyed or Transferred

   [.3] Cross-Guaranty—Waiver—Reasonable Losses

In the Matter of
FIRST AMERICAN BANK, N.A.
WASHINGTON, D.C.
FIRST AMERICAN BANK OF MARYLAND
SILVER SPRING, MARYLAND
FIRST AMERICAN BANK OF VIRGINIA
MCLEAN, VIRGINIA
FIRST AMERICAN BANK OF GEORGIA, N.A.
(IN LIQUIDATION)
ATLANTA, GEORGIA
(Insured Depository Institutions)
related to
INDEPENDENCE BANK
LOS ANGELES, CALIFORNIA
(Commonly Controlled Insured Depository Institution)
ORDER CONDITIONALLY GRANTING APPROVAL OF WAIVER OF CROSS GUARANTY

FDIC-93-131kk

   WHEREAS, based upon a Plea Agreement filed in the United States District Court for the District of Columbia on December 19, 1991, First American Bank, N.A., Washington, D.C., First American Bank of Maryland, Silver Spring, Maryland, First American Bank of Virginia, McLean, Virginia, and its wholly-owned subsidiary, First American Bank of Georgia, N.A. (In Liquidation), Atlanta, Georgia ("First American Banks"), and Independence Bank, Los Angeles, California ("Independence Bank"), appear to be commonly controlled within the definition of section 5(e) of the Federal Deposit Insurance Act, 12 U.S.C. §1815(e); and

   WHEREAS, the First American Banks are potentially liable to the Federal Deposit Insurance Corporation ("FDIC") pursuant to section 5(e) of the Act, 12 U.S.C. §1815(e), for losses incurred or reasonably anticipated to be incurred by the FDIC in connection with the default on January 30, 1992, of Independence Bank; and

   WHEREAS, First Union Corporation, Charlotte, North Carolina ("First Union"), has made a proposal to acquire all of the stock of First American Metro Corp., McLean, Virginia ("First American Metro"), the holding company which owns and controls all of the stock of the First American Banks; and

   WHEREAS, the terms of the foregoing proposal are more fully set forth in the Stock Purchase Agreement dated February 26, 1993, between First Union and First American Bancshares, Inc., the parent holding company of First American Metro ("Stock Purchase Agreement"); and

   WHEREAS, in conjunction with the proposal, First Union has made an application to the FDIC for an exemption pursuant to the provisions of section 5(e)(5)(A) of the Act, 12 U.S.C. §1815(e)(5)(A); and

   WHEREAS, the FDIC has fully considered the facts and information relating to the proposed acquisition and exemption, and has concluded that approval of the application would be in the best interests of the Bank Insurance Fund and should be granted, subject to the conditions and restrictions set forth below.

   [.1] IT IS THEREFORE ORDERED, that this ORDER CONDITIONALLY GRANTING APPROVAL FOR WAIVER OF CROSS GUARANTY ("ORDER") is conditional upon the acquisition of control of First American Metro by First Union in accordance with the terms of the Stock Purchase Agreement, and, absent such acquisition, this ORDER will become null and void.

   [.2] IT IS FURTHER ORDERED, that this Order will remain in effect only so long as First American Metro and the First American Banks are controlled by First Union, and its applicability may not be conveyed or otherwise transferred by First Union.

   [.3] IT IS FURTHER ORDERED, that the exemption granted by this ORDER will apply only to losses incurred or reasonably anticipated to be incurred by the FDIC in connection with the default of Independence Bank.

   Dated at Washington, D.C., this 11th day of June, 1993.

   Pursuant to delegated authority.

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Last Updated 6/6/2003 legal@fdic.gov