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[¶11,371] In the Matter of Abel Holtz, Capital Bank, Miami, Fla., Docket No. FDIC-96-190b (12-18-96)
Respondent ordered to cease and desist from such unsafe and unsound practices as engaging in solicitation of proxies from Bancorp stockholders; influencing the disposition or voting of any shares of Bancorp stock, excepting only the disposition of those shares that he owns directly; requesting or receiving performance reports or other internal data relating to the activities, operations, or financial condition of Capital Bank or any of its wholly owned subsidiaries; communicating with or attempting to communicate with any Capital Bank officer, director, or employee on any matters regarding the conduct of the operations or affairs of Capital Bank; involving himself in any discussions among his immediate family members concerning the affairs, direction, or operation of Capital Bank; seeking or accepting indemnification or any reimbursement from Capital Bank with respect to any expenses incurred by him related to FDIC Investigation No. 95-54n; and participating or involving himself in (1) negotiations over the sale or possible sale of Capital Bank or Bancorp stock owned or controlled by his immediate family members or (2) any discussions among his immediate family members regarding such sale or possible sale.
[.1] Shareholders—Execution of Irrevocable Proxy Required
[.2] Shareholders—Transfer of Proxies and/or Shares—Take Steps Satisfactory to FDIC
[.3] Shareholders—Restrict Respondent's Percentage of Outstanding Shares
[.4] Shareholders—Solicitation of Advice from Respondent—Notification of Provisions of Cease and Desist Order
In the Matter of
ABEL HOLTZ,
individually, and as a former
institution-affiliated party of
CAPITAL BANK
MIAMI, FLORIDA
(Insured State Nonmember Bank)
ORDER PURSUANT TO SECTION
8(b) OF THE FEDERAL DEPOSIT
INSURANCE ACT
FDIC-96-190b
ABEL HOLTZ ("Holtz"), individually,
{{2-28-97 p.C-4294}}and as a former institution-affiliated party of Capital Bank ("Bank"), the wholly-owned subsidiary of Capital Bancorp ("Bancorp"), both of Miami, Florida, (unless otherwise indicated, both will be hereinafter referred to as "Capital Bank"), has entered into a STIPULATION AND CONSENT TO THE ISSUANCE OF AN ORDER PURSUANT TO SECTION 8(b) OF THE ACT ("CONSENT AGREEMENT") with a representative of the Legal Division of the Federal Deposit Insurance Corporation ("FDIC"), dated December 18, 1996, whereby solely for the purpose of this proceeding and without admitting or denying that grounds exist for the issuance of such Order, Holtz consented to the issuance of the ORDER PURSUANT TO SECTION 8(b) ("ORDER") by the FDIC.
The FDIC considered the matter and determined that it has reason to believe that grounds exist for the issuance of such Order against Holtz.
The FDIC, therefore, accepted the CONSENT AGREEMENT and issued the following:
ORDER TO CEASE AND DESIST
IT IS HEREBY ORDERED, that Holtz cease and desist from engaging, and shall not engage, in the following activities:
A. Assisting, participating, or engaging in any way, directly or indirectly, in any solicitation of proxies from Bancorp stockholders;
B. Influencing or attempting to influence, directly or indirectly, the disposition or voting of any shares of Bancorp stock, excepting only the disposition of those shares owned directly by him;
C. Requesting or receiving, directly or indirectly, performance reports or other internal data relating to the activities, operations or financial condition of Capital Bank or any of its wholly-owned subsidiaries (which are hereinafter included in any reference to Capital Bank), and discussing information taken from such reports or data with any institution-affiliated party of Capital Bank or using such reports or data to influence any institution-affiliated party of Capital Bank. To the extent such reports are inadvertently received, Holtz shall forward such reports to the FDIC and inform the FDIC of the circumstances surrounding his inadvertent receipt of the reports;
D. Communicating with or attempting to communicate, directly or indirectly, with any Capital Bank officer, director, employee or any other person whom Holtz knows or should know to be an institution-affiliated party of Capital Bank on any matters regarding the conduct of the operations or affairs of Capital Bank;
E. Involving himself, directly or indirectly, in any discussions amongst his "immediate family members" as defined in the Proxy Agreement) concerning the affairs, direction or operation of Capital Bank;
F. Seeking or accepting indemnification or any reimbursement, directly or indirectly, from Capital Bank with respect to any expenses incurred by him related to the FDIC's Formal Examination pursuant to Section 10(c) of the Act, 12 U.S.C. § 1820(c), Investigation No. 95-54n, or the negotiation or issuance of this ORDER; and
G. Participating, or involving himself, in any way, directly or indirectly, in: 1) any negotiations over the sale or possible sale of Capital Bank or Bancorp stock owned or controlled by his immediate family members; or 2) any discussions amongst his immediate family members regarding such sale or possible sale.
IT IS FURTHER ORDERED that the Respondent take affirmative action as follows:
[.1] 1. Irrevocable Proxy
a. On or prior to the effective date of this ORDER, Holtz shall execute an irrevocable proxy in favor of Lawrence A. Gordich, an individual residing in Dade County ("Holder"), in the form of exhibit A attached hereto, with instructions to Holder to vote any and all shares of Bancorp stock owned or controlled by Holtz on a pro-rata basis on any matter that may be presented to the shareholders of Bancorp for a vote. The votes cast by Holder shall be proportionate to the vote of all shares voted by all other shareholders of Bancorp.
b. Holtz shall abide by all of the terms and conditions of the proxy, the provisions of which are incorporated herein by reference.
c. Holtz shall not terminate or amend the proxy without the prior written approval of the FDIC. He may sell or transfer his shares in accordance with restrictions contained in the proxy agreement.
[.2] 2. Holtz shall, on or before the effective date of this Order, take steps satisfactory to the FDIC regarding certain transfers made by him of proxies and/or shares after October 25, 1994, including: (a) the transfer
{{2-28-97 p.C-4295}}of 27,500 Bancorp shares on January 4, 1995; (b) the transfer of voting rights to 142,700 shares of Bancorp stock on January 5, 1995; and (c) the transfers of an aggregate of 30,000 shares of Capital Bancorp stock on February 27, 1995.
[.3] 3. Holtz shall ensure that Bancorp shares directly owned and/or controlled by him do not reach or exceed ten percent of the issued and outstanding Bancorp shares. In the event shares owned or controlled by Holtz should exceed ten percent due to: a) the reversal of transfers required under paragraph 2 of this ORDER; b) transfers by operation of law; or c) the redemption of shares by Bancorp, Holtz shall so notify the Regional Director within five (5) days and submit to him a plan to reduce such shares to less than ten percent. Such plan shall set forth the method of reduction and the time frame in which the reduction shall be accomplished. In no event shall such time frame for reducing Holtz's shares to below ten percent be more than forty-five days from the date on which Respondent's shares exceeded ten percent, unless the FDIC otherwise agrees to a longer period of time.
[.4] 4. Holtz shall inform any Bancorp shareholder or representative of such shareholder soliciting Holtz's advice, direction, or guidance with respect to any disposition or voting of Bancorp shares of his limitations under this ORDER and his inability to provide such advice, direction, or guidance.
EFFECT OF THE ORDER
1. Nothing in this Order shall preclude Holtz from being a depositor of or borrower from Capital Bank, from obtaining other banking services from the Bank routinely provided by the Bank to its customers, from discussing his personal business and affairs associated with his loans, deposits or other permissable banking business with the Bank or its employees, from receiving originals or copies of personal information and materials in the possession or control of the Bank, or receiving documents or reports from the Bank that are routinely provided by the Bank to its depositors, borrowers, shareholders or the public. This ORDER also does not preclude Respondent from being a partner in the partnership that leases real property to the Bank or having an ownership interest in the Avanti health club located in Capital Bank's home office.
2. This ORDER does not detail every action that Respondent is prohibited from engaging in pursuant to section 19 of the Act; accordingly, the FDIC does not waive or relinquish any right or claim it might have that certain actions violate such Act or might justify appropriate, remedial, regulatory or enforcement action, under Sections 19, 8 or otherwise. However, to the extent that certain actions are expressly permitted or prohibited hereunder, the provisions of this ORDER shall govern.
3. The provisions of this ORDER shall become effective ten (10) days from the date of its issuance and shall be binding upon the Respondent. 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 December, 1996.
