Document:

ex10-1.htm

    

       

      

      

      

      PURCHASE
AND ASSUMPTION AGREEMENT

      

      WHOLE
BANK

      

      

      ALL
DEPOSITS

      

      AMONG

      

      FEDERAL
DEPOSIT INSURANCE CORPORATION,

      RECEIVER
OF COOPERATIVE BANK,

      WILMINGTON,
NORTH CAROLINA

      

      FEDERAL
DEPOSIT INSURANCE CORPORATION

      

      and

      

      FIRST
BANK

      

      

      DATED
AS OF

      

      JUNE
19, 2009

      

      

      

      

      
        
          
            
              	
                      Module
      1 – Whole Bank w/ Loss Share – P&A

                    	
                      COOPERATIVE
      BANK

                    
	
                      Version
      1.05

                    	
                      WILMINGTON,
      NORTH CAROLINA

                    
	
                      June
      16, 2009

                    	 
      

            

            

          

           

        

        
           

          
            

          

        

        
           

        

      

      

      TABLE
OF CONTENTS

      

      

      
        
          	
                  ARTICLE
      I

                	
                  DEFINITIONS

                	
                  2

                
	 
      	 
      	 
      
	
                  ARTICLE
      II

                	
                  ASSUMPTION
      OF LIABILITIES

                	
                  8

                
	 
      	 
      	 
      
	
                  2.1

                	
                  Liabilities
      Assumed by Assuming Bank

                	
                  8

                
	
                  2.2

                	
                  Interest
      on Deposit Liabilities

                	
                  10

                
	
                  2.3

                	
                  Unclaimed
      Deposits

                	
                  10

                
	
                  2.4

                	
                  Employee
      Plans

                	
                  10

                
	 
      	 
      	 
      
	
                  ARTICLE
      III

                	
                  PURCHASE
      OF ASSETS

                	
                  11

                
	 
      	 
      	 
      
	
                  3.1

                	
                  Assets
      Purchased by Assuming Bank

                	
                  11

                
	
                  3.2

                	
                  Asset
      Purchase Price

                	
                  11

                
	
                  3.3

                	
                  Manner
      of Conveyance; Limited Warranty; Nonrecourse; Etc.

                	
                  12

                
	
                  3.4

                	
                  Puts
      of Assets to the Receiver

                	
                  12

                
	
                  3.5

                	
                  Assets
      Not Purchased by Assuming Bank

                	
                  13

                
	
                  3.6

                	
                  Assets
      Essential to Receiver

                	
                  15

                
	 
      	 
      	 
      
	
                  ARTICLE
      IV

                	
                  ASSUMPTION
      OF CERTAIN DUTIES AND OBLIGATIONS

                	
                  16

                
	 
      	 
      	 
      
	
                  4.1

                	
                  Continuation
      of Banking Business

                	
                  16

                
	
                  4.2

                	
                  Agreement
      with Respect to Credit Card Business

                	
                  16

                
	
                  4.3

                	
                  Agreement
      with Respect to Safe Deposit Business

                	
                  16

                
	
                  4.4

                	
                  Agreement
      with Respect to Safekeeping Business

                	
                  16

                
	
                  4.5

                	
                  Agreement
      with Respect to Trust Business

                	
                  16

                
	
                  4.6

                	
                  Agreement
      with Respect to Bank Premises

                	
                  17

                
	
                  4.7

                	
                  Agreement
      with Respect to Leased Data Processing Equipment

                	
                  20

                
	
                  4.8

                	
                  Agreement
      with Respect to Certain Existing Agreements

                	
                  20

                
	
                  4.9

                	
                  Informational
      Tax Reporting

                	
                  21

                
	
                  4.10

                	
                  Insurance

                	
                  21

                
	
                  4.11

                	
                  Office
      Space for Receiver and Corporation

                	
                  22

                
	
                  4.12

                	
                  Agreement
      with Respect to Continuation of Group Health Plan Coverage for Former
      Employees

                	
                  22

                
	
                  4.13

                	
                  Agreement
      with Respect to Interim Asset Servicing

                	
                  23

                

          
            
              
                

                 

                
                  	
                        
	
                           

                        	
                           

                        
	
                           

                        	
                           

                        
	
                           

                        	 
      

                

                	
                        Module
      1 – Whole Bank w/ Loss Share – P&A

                      	
                        COOPERATIVE
      BANK

                      
	
                        Version
      1.05

                      	
                        WILMINGTON,
      NORTH CAROLINA

                      
	
                        June
      16, 2009

                      	 
      

              

              
              

            

            

          

           

        

      

    

    
      ii

      
        

      

    

    
       

    

    
    

    

    

    
      	 
      	 
      	 
      
	
              ARTICLE
      V

            	
              DUTIES
      WITH RESPECT TO DEPOSITORS OF THE FAILED BANK

            	
              23

            
	 
      	 
      	 
      
	
              5.1

            	
              Payment
      of Checks, Drafts and Orders

            	
              23

            
	
              5.2

            	
              Certain
      Agreements Related to Deposits

            	
              24

            
	
              5.3

            	
              Notice
      to Depositors

            	
              24

            
	 
      	 
      	 
      
	
              ARTICLE
      VI

            	
              RECORDS

            	
              24

            
	 
      	 
      	 
      
	
              6.1

            	
              Transfer
      of Records

            	
              24

            
	
              6.2

            	
              Delivery
      of Assigned Records

            	
              25

            
	
              6.3

            	
              Preservation
      of Records

            	
              25

            
	
              6.4

            	
              Access
      to Records; Copies

            	
              25

            
	 
      	 
      	 
      
	
              ARTICLE
      VII

            	
              FIRST
      LOSS TRANCHE

            	
              26

            
	 
      	 
      	 
      
	
              ARTICLE
      VIII

            	
              ADJUSTMENTS

            	
              26

            
	 
      	 
      	 
      
	
              8.1

            	
              Pro
      Forma Statement

            	
              26

            
	
              8.2

            	
              Correction
      of Errors and Omissions; Other Liabilities

            	 
      
	
              8.3

            	
              Payments

            	
              27

            
	
              8.4

            	
              Interest

            	
              27

            
	
              8.5

            	
              Subsequent
      Adjustments

            	
              27

            
	 
      	 
      	 
      
	
              ARTICLE
      IX

            	
              CONTINUING
      COOPERATION

            	
              28

            
	 
      	 
      	 
      
	
              9.1

            	
              General
      Matters

            	
              28

            
	
              9.2

            	
              Additional
      Title Documents

            	
              28

            
	
              9.3

            	
              Claims
      and Suits

            	
              28

            
	
              9.4

            	
              Payment
      of Deposits

            	
              28

            
	
              9.5

            	
              Withheld
      Payments

            	
              29

            
	
              9.6

            	
              Proceedings
      with Respect to Certain Assets and Liabilities

            	
              29

            
	
              9.7

            	
              Information

            	
              30

            
	 
      	 
      	 
      
	
              ARTICLE
      X

            	
              CONDITION
      PRECEDENT

            	
              30

            
	 
      	 
      	 
      
	
              ARTICLE
      XI

            	
              REPRESENTATIONS
      AND WARRANTIES OF THE ASSUMING BANK

            	
              30

            
	 
      	 
      	 
      
	
              ARTICLE
      XII

            	
              INDEMNIFICATION

            	
              31

            
	 
      	 
      	 
      
	
              12.1

            	
              Indemnification
      of Indemnitees

            	
              31

            
	
              12.2

            	
              Conditions
      Precedent to Indemnification

            	
              34

            
	
              12.3

            	
              No
      Additional Warranty

            	
              35

            
	
              12.4

            	
              Indemnification
      of Corporation and Receiver

            	
              35

            
	
              12.5

            	
              Obligations
      Supplemental

            	
              35

            

      
        
          
            

             

            
              	
                    
	
                       

                    	
                       

                    
	
                       

                    	
                       

                    
	
                       

                    	 
      

            

            	
                    Module
      1 – Whole Bank w/ Loss Share – P&A

                  	
                    COOPERATIVE
      BANK

                  
	
                    Version
      1.05

                  	
                    WILMINGTON,
      NORTH CAROLINA

                  
	
                    June
      16, 2009

                  	 
      

          

          
          

        

        

      

       

    

    
      iii

      
        

      

    

    
       

    

    
    

    

    
      	
              12.6

            	
              Criminal
      Claims

            	
              36

            
	
              12.7

            	
              Limited
      Guaranty of the Corporation

            	
              36

            
	
              12.8

            	
              Subrogation

            	
              36

            
	 
      	 
      	 
      
	
              ARTICLE
      XIII

            	
              MISCELLANEOUS

            	
              36

            
	 
      	 
      	 
      
	
              13.1

            	
              Entire
      Agreement

            	
              36

            
	
              13.2

            	
              Headings

            	
              36

            
	
              13.3

            	
              Counterparts

            	
              37

            
	
              13.4

            	
              Governing
      Law

            	
              37

            
	
              13.5

            	
              Successors

            	
              37

            
	
              13.6

            	
              Modification;
      Assignment

            	
              37

            
	
              13.7

            	
              Notice

            	
              37

            
	
              13.8

            	
              Manner
      of Payment

            	
              38

            
	
              13.9

            	
              Costs,
      Fees and Expenses

            	
              38

            
	
              13.10

            	
              Waiver

            	
              38

            
	
              13.11

            	
              Severability

            	
              39

            
	
              13.12

            	
              Term
      of Agreement

            	
              39

            
	
              13.13

            	
              Survival
      of Covenants, Etc.

            	
              39

            
	 
      	 
      	 
      
	
              SCHEDULES

            	 
      	 
      
	 
      	 
      	 
      
	
              2.1

            	
              Certain
      Liabilities Assumed

            	
              41

            
	
              2.1(a)

            	
              Excluded
      Deposit Liability Accounts

            	
              42

            
	
              3.1

            	
              Certain
      Assets Purchased

            	
              43

            
	
              3.2

            	
              Purchase
      Price of Assets or Assets

            	
              44

            
	
              3.5(l)

            	
              Excluded
      Private Label Assets-Backed Securities

            	
              46

            
	
              4.15A

            	
              Single
      Family Loss Share Loans

            	
              53

            
	
              4.15B

            	
              Non-Single
      Family Loss Share Loans

            	
              48

            
	
              7

            	
              Calculation
      of Deposit Premium

            	
              49

            
	 
      	 
      	 
      
	 
      	 
      	 
      
	
              EXHIBITS

            	 
      	 
      
	 
      	 
      	 
      
	
              4.13

            	
              Interim
      Asset Servicing Arrangement

            	
              51

            
	
              4.15A

            	
              Single
      Family Loss Share Agreement

            	
              53

            
	
              4.15B

            	
              Commercial
      Loss Share Agreement

            	
              88

            

    

    

      
        
          
            

             

            
              	
                    
	
                       

                    	
                       

                    
	
                       

                    	
                       

                    
	
                       

                    	 
      

            

            	
                    Module
      1 – Whole Bank w/ Loss Share – P&A

                  	
                    COOPERATIVE
      BANK

                  
	
                    Version
      1.05

                  	
                    WILMINGTON,
      NORTH CAROLINA

                  
	
                    June
      16, 2009

                  	 
      

          

          
          

        

        

      

       

    

    
      iv

      
        

      

    

    
       

    

    
    

    

    

    

    

    PURCHASE AND ASSUMPTION
AGREEMENT

    

    WHOLE
BANK

    

    ALL
DEPOSITS

    

    

    THIS AGREEMENT, made and
entered into as of the
19th day of JUNE, 2009, by and
among the FEDERAL DEPOSIT
INSURANCE CORPORATION, RECEIVER of COOPERATIVE BANK, WILMINGTON, NORTH CAROLINA
(the "Receiver"), FIRST
BANK, organized under the laws of the United States of America, and
having its principal place of business in TROY, NORTH CAROLINA (the
"Assuming Bank"), and the FEDERAL DEPOSIT INSURANCE
CORPORATION, organized under the laws of the United States of America and
having its principal office in Washington, D.C., acting in its corporate
capacity (the "Corporation").

    

    WITNESSETH:

    

    WHEREAS, on Bank Closing, the
Chartering Authority closed COOPERATIVE BANK (the "Failed
Bank") pursuant to applicable law and the Corporation was appointed Receiver
thereof; and

    

    WHEREAS, the Assuming Bank
desires to purchase certain assets and assume certain deposit and other
liabilities of the Failed Bank on the terms and conditions set forth in this
Agreement; and

    

    WHEREAS, pursuant to 12 U.S.C.
Section 1823(c)(2)(A), the Corporation may provide assistance to the Assuming
Bank to facilitate the transactions contemplated by this Agreement, which
assistance may include indemnification pursuant to Article XII; and

    

    WHEREAS, the Board of
Directors of the Corporation (the "Board") has determined to provide assistance
to the Assuming Bank on the terms and subject to the conditions set forth in
this Agreement; and

    

    WHEREAS, the Board has
determined pursuant to 12 U.S.C. Section 1823(c)(4)(A) that such assistance is
necessary to meet the obligation of the Corporation to provide insurance
coverage for the insured deposits in the Failed Bank.

    

    NOW THEREFORE, in
consideration of the mutual promises herein set forth and other valuable
consideration, the parties hereto agree as follows:

    

    
      
        
          
            	
                    Module
      1 – Whole Bank w/ Loss Share – P&A

                  	
                    COOPERATIVE
      BANK

                  
	
                    Version
      1.05

                  	
                    WILMINGTON,
      NORTH CAROLINA

                  
	
                    June
      16, 2009

                  	 
      

          

           

        

         

      

      
        1

        
          

        

      

      
         

      

    

    ARTICLE
I

    DEFINITIONS

    

    Capitalized terms used in this
Agreement shall have the meanings set forth in this Article I, or elsewhere in
this Agreement. As used herein, words imparting the singular include the plural
and vice versa.

    

    "Accounting
Records" means
the general ledger and subsidiary ledgers and supporting schedules which support
the general ledger balances.

    

    "Acquired
Subsidiaries"
means Subsidiaries of the Failed Bank acquired pursuant to Section
3.1.

    

    "Adversely
Classified"
means, with respect to any Loan or security, a Loan or security which, as of the
date of the most recent pertinent data made available to the Assuming Bank as
part of the Information Package, has been designated in the most recent report
of examination as "Substandard," "Doubtful" or "Loss" by the Failed Bank's
appropriate Federal or State Chartering Authority or regulator.

    

    "Affiliate" of any Person means any
director, officer, or employee of that Person and any other Person (i) who is
directly or indirectly controlling, or controlled by, or under direct or
indirect common control with, such Person, or (ii) who is an affiliate of such
Person as the term "affiliate" is defined in Section 2 of the Bank Holding
Company Act of 1956, as amended, 12 U.S.C. Section 1841.

    

    "Agreement" means this Purchase and
Assumption Agreement by and among the Assuming Bank, the Corporation and the
Receiver, as amended or otherwise modified from time to time.

    

    "Assets" means all assets of the
Failed Bank purchased pursuant to Section 3.1. Assets owned by Subsidiaries of
the Failed Bank are not "Assets" within the meaning of this
definition.

    

    "Assumed
Deposits" means
Deposits.

    

    "Bank
Closing" means
the close of business of the Failed Bank on the date on which the Chartering
Authority closed such institution.

    

    "Bank
Premises" means
the banking houses, drive-in banking facilities, and teller facilities (staffed
or automated) together with appurtenant parking, storage and service facilities
and structures connecting remote facilities to banking houses, and land on which
the foregoing are located, that are owned or leased by the Failed Bank and that
are occupied by the Failed Bank as of Bank Closing.

    

    "Book
Value" means,
with respect to any Asset and any Liability Assumed, the dollar amount thereof
stated on the Accounting Records of the Failed Bank. The Book Value
of

      
        
          
            

             

            
              	
                    
	
                       

                    	
                       

                    
	
                       

                    	
                       

                    
	
                       

                    	 
      

            

            	
                    Module
      1 – Whole Bank w/ Loss Share – P&A

                  	
                    COOPERATIVE
      BANK

                  
	
                    Version
      1.05

                  	
                    WILMINGTON,
      NORTH CAROLINA

                  
	
                    June
      16, 2009

                  	 
      

          

          
          

        

        

      

       

    

    
      2

      
        

      

    

    
       

    

    
    

    any item
shall be determined as of Bank Closing after adjustments made by the Receiver
for differences in accounts, suspense items, unposted debits and credits, and
other similar adjustments or corrections and for setoffs, whether voluntary or
involuntary. The Book Value of a Subsidiary of the Failed Bank acquired by the
Assuming Bank shall be determined from the investment in subsidiary and related
accounts on the "bank only" (unconsolidated) balance sheet of the Failed Bank
based on the equity method of accounting. Without limiting the generality of the
foregoing, (i) the Book Value of a Liability Assumed shall include all accrued
and unpaid interest thereon as of Bank Closing, and (ii) the Book Value of a
Loan shall reflect adjustments for earned interest, or unearned interest (as it
relates to the "rule of 78s" or add-on-interest loans, as applicable), if any,
as of Bank Closing, adjustments for the portion of earned or unearned
loan-related credit life and/or disability insurance premiums, if any,
attributable to the Failed Bank as of Bank Closing, and adjustments for Failed
Bank Advances, if any, in each case as determined for financial reporting
purposes. The Book Value of an Asset shall not include any adjustment for loan
premiums, discounts or any related deferred income or fees, or general or
specific reserves on the Accounting Records of the Failed Bank.

    

    "Business
Day" means a day
other than a Saturday, Sunday, Federal legal holiday or legal holiday under the
laws of the State where the Failed Bank is located, or a day on which the
principal office of the Corporation is closed.

    

    "Chartering
Authority" means
(i) with respect to a national bank, the Office of the Comptroller of the
Currency, (ii) with respect to a Federal savings association or savings bank,
the Office of Thrift Supervision, (iii) with respect to a bank or savings
institution chartered by a State, the agency of such State charged with primary
responsibility for regulating and/or closing banks or savings institutions, as
the case may be, (iv) the Corporation in accordance with 12 U.S.C. Section
1821(c), with regard to self appointment, or (v) the appropriate Federal banking
agency in accordance with 12 U.S.C. 1821(c)(9).

    

    "Commitment" means the unfunded portion
of a line of credit or other commitment reflected on the books and records of
the Failed Bank to make an extension of credit (or additional advances with
respect to a Loan) that was legally binding on the Failed Bank as of Bank
Closing, other than extensions of credit pursuant to the credit card business
and overdraft protection plans of the Failed Bank, if any.

    

    "Credit
Documents" mean
the agreements, instruments, certificates or other documents at any time
evidencing or otherwise relating to, governing or executed in connection with or
as security for, a Loan, including without limitation notes, bonds, loan
agreements, letter of credit applications, lease financing contracts, banker's
acceptances, drafts, interest protection agreements, currency exchange
agreements, repurchase agreements, reverse repurchase agreements, guarantees,
deeds of trust, mortgages, assignments, security agreements, pledges,
subordination or priority agreements, lien priority agreements, undertakings,
security instruments, certificates, documents, legal opinions, participation
agreements and intercreditor agreements, and all amendments, modifications,
renewals, extensions, rearrangements, and substitutions with respect to any of
the foregoing.

    
      
        
          

           

          
            	
                  
	
                     

                  	
                     

                  
	
                     

                  	
                     

                  
	
                     

                  	 
      

          

          	
                  Module
      1 – Whole Bank w/ Loss Share – P&A

                	
                  COOPERATIVE
      BANK

                
	
                  Version
      1.05

                	
                  WILMINGTON,
      NORTH CAROLINA

                
	
                  June
      16, 2009

                	 
      

        

        
        

      

      

    

     

    
      3

      
        

      

    

    
       

    

    
    

    "Credit
File" means all
Credit Documents and all other credit, collateral, or insurance documents in the
possession or custody of the Assuming Bank, or any of its Subsidiaries or
Affiliates, relating to an Asset or a Loan included in a Put Notice, or copies
of any thereof.

    

    "Data
Processing Lease"
means any lease or licensing agreement, binding on the Failed Bank as of Bank
Closing, the subject of which is data processing equipment or computer hardware
or software used in connection with data processing activities. A lease or
licensing agreement for computer software used in connection with data
processing activities shall constitute a Data Processing Lease regardless of
whether such lease or licensing agreement also covers data processing
equipment.

    

    "Deposit" means a deposit as defined
in 12 U.S.C. Section 1813(l), including without limitation, outstanding
cashier's checks and other official checks and all uncollected items included in
the depositors' balances and credited on the books and records of the Failed
Bank; provided,
that the term
"Deposit" shall not include all or any portion of those deposit balances which,
in the discretion of the Receiver or the Corporation, (i) may be required to
satisfy it for any liquidated or contingent liability of any depositor arising
from an unauthorized or unlawful transaction, or (ii) may be needed to provide
payment of any liability of any depositor to the Failed Bank or the Receiver,
including the liability of any depositor as a director or officer of the Failed
Bank, whether or not the amount of the liability is or can be determined as of
Bank Closing.

    

    "Equity
Adjustment" means
the dollar amount resulting by subtracting the Book Value, as of Bank Closing,
of all Liabilities Assumed under this Agreement by the Assuming Bank from the
Book Value, as of Bank Closing, of all Assets acquired under this Agreement by
the Assuming Bank, which may be a positive or a negative number.

    

    "Failed
Bank Advances"
means the total sums paid by the Failed Bank to (i) protect its lien position,
(ii) pay ad valorem taxes and hazard insurance, and (iii) pay credit life
insurance, accident and health insurance, and vendor's single interest
insurance.

    

    "Fair
Market Value"
means (i)(a) “Market Value” as defined in the regulation prescribing the
standards for real estate appraisals used in federally related transactions, 12
C.F.R. § 323.2(g), and accordingly shall mean the most probable price which a
property should bring in a competitive and open market under all conditions
requisite to a fair sale, the buyer and seller each acting prudently and
knowledgeably, and assuming the price is not affected by undue stimulus.
Implicit in this definition is the consummation of a sale as of a specified date
and the passing of title from seller to buyer under conditions
whereby:

    

    (1) Buyer
and seller are typically motivated;

    (2) Both
parties are well informed or well advised, and acting in what they consider
their own best interests;

    (3) A
reasonable time is allowed for exposure in the open market;

    (4)
Payment is made in terms of cash in U.S. dollars or in terms of financial
arrangements comparable thereto; and

    
      
        
          

           

          
            	
                  
	
                     

                  	
                     

                  
	
                     

                  	
                     

                  
	
                     

                  	 
      

          

          	
                  Module
      1 – Whole Bank w/ Loss Share – P&A

                	
                  COOPERATIVE
      BANK

                
	
                  Version
      1.05

                	
                  WILMINGTON,
      NORTH CAROLINA

                
	
                  June
      16, 2009

                	 
      

        

        
        

      

      

    

     

    
      4

      
        

      

    

    
       

    

    
    

    (5) The
price represents the normal consideration for the property sold unaffected by
special or creative financing or sales concessions granted by anyone associated
with the sale;

    

    as
determined as of Bank Closing by an appraiser chosen by the Assuming Bank from a
list of acceptable appraisers provided by the Receiver; any costs and fees
associated with such determination shall be shared equally by the Receiver and
the Assuming Bank, and (b) which, with respect to Bank Premises (to the extent,
if any, that Bank Premises are purchased utilizing this valuation method), shall
be determined not later than sixty (60) days after Bank Closing by an appraiser
selected by the Receiver and the Assuming Bank within seven (7) days after Bank
Closing; or (ii) with respect to property other than Bank Premises purchased
utilizing this valuation method, the price therefore as established by the
Receiver and agreed to by the Assuming Bank, or in the absence of such
agreement, as determined in accordance with clause (i)(a) above.

    

    "First
Loss Tranche" means the dollar amount of liability that the Assuming Bank
will incur prior to the commencement of loss sharing, which is the sum of (i)
the Assuming Bank’s asset premium (discount) bid, as reflected on the Assuming
Bank’s bid form, plus (ii) the Assuming Bank’s Deposit premium bid, as reflected
on the Assuming Bank’s bid form, plus (iii) the Equity
Adjustment.  The First Loss Tranche may be a positive or negative
number.

    

    "Fixtures"
means those leasehold improvements, additions, alterations and installations
constituting all or a part of Bank Premises and which were acquired, added,
built, installed or purchased at the expense of the Failed Bank, regardless of
the holder of legal title thereto as of Bank Closing.

    

    "Furniture
and Equipment"
means the furniture and equipment, other than motor vehicles, leased or owned by
the Failed Bank and reflected on the books of the Failed Bank as of Bank
Closing, including without limitation automated teller machines, carpeting,
furniture, office machinery (including personal computers), shelving, office
supplies, telephone, surveillance and security systems.  Motor
vehicles shall be considered other assets and pass at Book Value.

    

    "Indemnitees" means, except as provided in
paragraph (k) of Section 12.1, (i) the Assuming Bank, (ii) the Subsidiaries and
Affiliates of the Assuming Bank other than any Subsidiaries
or Affiliates of the Failed Bank that are or become Subsidiaries or Affiliates
of the Assuming Bank, and (iii) the directors, officers, employees and agents of
the Assuming Bank and its Subsidiaries and Affiliates who are not also present or
former directors, officers, employees or agents of the Failed Bank or of any
Subsidiary or Affiliate of the Failed Bank.

    

    "Information
Package" means
the most recent compilation of financial and other data with respect to the
Failed Bank, including any amendments or supplements thereto, provided to the
Assuming Bank by the Corporation on the web site used by the Corporation to
market the Failed Bank to potential acquirers.

    
      
        
          

           

          
            	
                  
	
                     

                  	
                     

                  
	
                     

                  	
                     

                  
	
                     

                  	 
      

          

          	
                  Module
      1 – Whole Bank w/ Loss Share – P&A

                	
                  COOPERATIVE
      BANK

                
	
                  Version
      1.05

                	
                  WILMINGTON,
      NORTH CAROLINA

                
	
                  June
      16, 2009

                	 
      

        

        
        

      

      

    

     

    
      5

      
        

      

    

    
       

    

    
    

    "Legal
Balance" means
the amount of indebtedness legally owed by an Obligor with respect to a Loan,
including principal and accrued and unpaid interest, late fees, attorneys' fees
and expenses, taxes, insurance premiums, and similar charges, if
any.

    

    "Liabilities
Assumed" has the
meaning provided in Section 2.1.

    

    "Lien" means any mortgage, lien,
pledge, charge, assignment for security purposes, security interest, or
encumbrance of any kind with respect to an Asset, including any conditional sale
agreement or capital lease or other title retention agreement relating to such
Asset.

    

    "Loans" means all of the following
owed to or held by the Failed Bank as of Bank Closing:

    

    (i)           loans
(including loans which have been charged off the Accounting Records of the
Failed Bank in whole or in part prior to the date of the most recent pertinent
data made available to the Assuming Bank as part of the Information Package),
participation agreements, interests in participations, overdrafts of customers
(including but not limited to overdrafts made pursuant to an overdraft
protection plan or similar extensions of credit in connection with a deposit
account), revolving commercial lines of credit, home equity lines of credit,
Commitments, United States and/or State-guaranteed student loans, and lease
financing contracts;

    

    (ii)           all
Liens, rights (including rights of set-off), remedies, powers, privileges,
demands, claims, priorities, equities and benefits owned or held by, or accruing
or to accrue to or for the benefit of, the holder of the obligations or
instruments referred to in clause (i) above, including but not limited to those
arising under or based upon Credit Documents, casualty insurance policies and
binders, standby letters of credit, mortgagee title insurance policies and
binders, payment bonds and performance bonds at any time and from time to time
existing with respect to any of the obligations or instruments referred to in
clause (i) above; and

    

    (iii)           all
amendments, modifications, renewals, extensions, refinancings, and refundings of
or for any of the foregoing.

    

    "Obligor" means each Person liable for
the full or partial payment or performance of any Loan, whether such Person is
obligated directly, indirectly, primarily, secondarily, jointly, or
severally.

    

    "Other
Real Estate"
means all interests in real estate (other than Bank Premises and Fixtures) and
loans on "in substance foreclosure" status as of Bank Closing as recorded on the
Accounting Records of the Failed Bank, including but not limited to mineral
rights, leasehold rights, condominium and cooperative interests, air rights and
development rights that are owned by the Failed Bank.

    
      
        
          

           

          
            	
                  
	
                     

                  	
                     

                  
	
                     

                  	
                     

                  
	
                     

                  	 
      

          

          	
                  Module
      1 – Whole Bank w/ Loss Share – P&A

                	
                  COOPERATIVE
      BANK

                
	
                  Version
      1.05

                	
                  WILMINGTON,
      NORTH CAROLINA

                
	
                  June
      16, 2009

                	 
      

        

        
        

      

      

    

     

    
      6

      
        

      

    

    
       

    

    
    

    "Person" means any individual,
corporation, partnership, joint venture, association, joint-stock company,
trust, unincorporated organization, or government or any agency or political
subdivision thereof, excluding the Corporation.

    

    "Primary
Indemnitor" means
any Person (other than the Assuming Bank or any of its Affiliates) who is
obligated to indemnify or insure, or otherwise make payments (including payments
on account of claims made against) to or on behalf of any Person in connection
with the claims covered under Article XII, including without limitation any
insurer issuing any directors and officers liability policy or any Person
issuing a financial institution bond or banker's blanket bond.

    

    “Proforma” means producing a balance
sheet that reflects a reasonably accurate financial statement of the Failed bank
through the date of closing. The Proforma financial statements serve as a basis
for the opening entries of both the Assuming Bank and the Receiver.

    

    "Put
Date" has the
meaning provided in Section 3.4.

    

    "Put
Notice" has the
meaning provided in Section 3.4.

    

    "Qualified
Financial Contract" means a qualified financial
contract as defined in 12 U.S.C. Section 1821(e)(8)(D).

    

    "Record" means any document,
microfiche, microfilm and computer records (including but not limited to
magnetic tape, disc storage, card forms and printed copy) of the Failed Bank
generated or maintained by the Failed Bank that is owned by or in the possession
of the Receiver at Bank Closing.

    

    "Related
Liability" with
respect to any Asset means any liability existing and reflected on the
Accounting Records of the Failed Bank as of Bank Closing for (i) indebtedness
secured by mortgages, deeds of trust, chattel mortgages, security interests or
other liens on or affecting such Asset, (ii) ad valorem taxes applicable to such
Asset, and (iii) any other obligation determined by the Receiver to be
directly related to such Asset.

    

    "Related
Liability Amount"
with respect to any Related Liability on the books of the Assuming Bank, means
the amount of such Related Liability as stated on the Accounting Records of the
Assuming Bank (as maintained in accordance with generally accepted accounting
principles) as of the date as of which the Related Liability Amount is being
determined. With respect to a liability that relates to more than one asset, the
amount of such Related Liability shall be allocated among such assets for the
purpose of determining the Related Liability Amount with respect to any one of
such assets. Such allocation shall be made by specific allocation, where
determinable, and otherwise shall be pro rata based upon the dollar amount of
such assets stated on the Accounting Records of the entity that owns such
asset.

    

    "Repurchase
Price" means,
with respect to any Loan the Book Value, adjusted to reflect changes to Book
Value after Bank Closing, plus (ii) any advances and interest on such Loan after
Bank Closing, minus (iii) the total of amounts received by the Assuming Bank
for

    
      
        
          

           

          
            	
                  
	
                     

                  	
                     

                  
	
                     

                  	
                     

                  
	
                     

                  	 
      

          

          	
                  Module
      1 – Whole Bank w/ Loss Share – P&A

                	
                  COOPERATIVE
      BANK

                
	
                  Version
      1.05

                	
                  WILMINGTON,
      NORTH CAROLINA

                
	
                  June
      16, 2009

                	 
      

        

        
        

      

      

    

     

    
      7

      
        

      

    

    
       

    

    
    

    such
Loan, regardless of how applied, after Bank Closing, plus (iv) advances made by
Assuming Bank, plus (v) total disbursements of principal made by Receiver that
are not included in the Book Value.

    

    "Safe
Deposit Boxes"
means the safe deposit boxes of the Failed Bank, if any, including the removable
safe deposit boxes and safe deposit stacks in the Failed Bank's vault(s), all
rights and benefits under rental agreements with respect to such safe deposit
boxes, and all keys and combinations thereto.

    

    "Settlement
Date" means the
first Business Day immediately prior to the day which is one hundred eighty
(180) days after Bank Closing, or such other date prior thereto as may be agreed
upon by the Receiver and the Assuming Bank. The Receiver, in its discretion, may
extend the Settlement Date.

    

    "Settlement
Interest Rate"
means, for the first calendar quarter or portion thereof during which
interest accrues, the rate determined by the Receiver to be equal to the
equivalent coupon issue yield on twenty-six (26)-week United States Treasury
Bills in effect as of Bank Closing as published in The Wall Street
Journal; provided, that if no such
equivalent coupon issue yield is available as of Bank Closing, the equivalent
coupon issue yield for such Treasury Bills most recently published in The Wall Street
Journal prior to Bank Closing shall be used. Thereafter, the rate shall
be adjusted to the rate determined by the Receiver to be equal to the equivalent
coupon issue yield on such Treasury Bills in effect as of the first day of each
succeeding calendar quarter during which interest accrues as published in The Wall Street
Journal.

    

    "Subsidiary" has the meaning set forth in
Section 3(w)(4) of the Federal Deposit Insurance Act, 12 U.S.C. Section
1813(w)(4), as amended.

    

    ARTICLE
II

    ASSUMPTION
OF LIABILITIES

    

    2.1           Liabilities
Assumed by Assuming Bank. The Assuming Bank expressly
assumes at Book Value (subject to adjustment pursuant to Article VIII) and
agrees to pay, perform, and discharge all of the following liabilities of the
Failed Bank as of Bank Closing, except as otherwise provided in this Agreement
(such liabilities referred to as "Liabilities Assumed"):

    

    
      	
               
      

            	
              (a)

            	
              Assumed
      Deposits, except those Deposits specifically listed on Schedule 2.1(a);
      provided,
      that as
      to any Deposits of public money which are Assumed Deposits, the Assuming
      Bank agrees to properly secure such Deposits with such of the Assets as
      appropriate which, prior to Bank Closing, were pledged as security
      therefor by the Failed Bank, or with assets of the Assuming Bank, if such
      securing Assets, if any, are insufficient to properly secure such
      Deposits;

            

    

    

    
      	
               
      

            	
              (b)

            	
              liabilities
      for indebtedness secured by mortgages, deeds of trust, chattel mortgages,
      security interests or other liens on or affecting any Assets, if
      any;

            

    

    
      
        
          

           

          
            	
                  
	
                     

                  	
                     

                  
	
                     

                  	
                     

                  
	
                     

                  	 
      

          

          	
                  Module
      1 – Whole Bank w/ Loss Share – P&A

                	
                  COOPERATIVE
      BANK

                
	
                  Version
      1.05

                	
                  WILMINGTON,
      NORTH CAROLINA

                
	
                  June
      16, 2009

                	 
      

        

        
        

      

      

    

     

    
      8

      
        

      

    

    
       

    

    
    

    provided, that the assumption
of any liability pursuant to this paragraph shall be limited to the market value
of the Assets securing such liability as determined by the
Receiver;

    

    
      	
               
      

            	
              (c)

            	
              borrowings
      from Federal Reserve Banks and Federal Home Loan Banks, if any, provided, that the
      assumption of any liability pursuant to this paragraph shall be limited to
      the market value of the assets securing such liability as determined by
      the Receiver; and overdrafts, debit balances, service charges,
      reclamations, and adjustments to accounts with the Federal Reserve Banks
      as reflected on the books and records of any such Federal Reserve Bank
      within ninety (90) days after Bank Closing, if
  any;

            

    

    

    
      	
               
      

            	
              (d)

            	
              ad
      valorem taxes applicable to any Asset, if any; provided, that the
      assumption of any ad valorem taxes pursuant to this paragraph shall be
      limited to an amount equal to the market value of the Asset to which such
      taxes apply as determined by the
Receiver;

            

    

    

    
      	
               
      

            	
              (e)

            	
              liabilities,
      if any, for federal funds purchased, repurchase agreements and overdrafts
      in accounts maintained with other depository institutions (including any
      accrued and unpaid interest thereon computed to and including Bank
      Closing); provided, that the
      assumption of any liability pursuant to this paragraph shall be limited to
      the market value of the Assets securing such liability as determined by
      the Receiver;

            

    

    

    (f)           United
States Treasury tax and loan note option accounts, if any;

    

    
      	
               
      

            	
              (g)

            	
              liabilities
      for any acceptance or commercial letter of credit (other than "standby
      letters of credit" as defined in 12 C.F.R. Section 337.2(a)); provided, that the
      assumption of any liability pursuant to this paragraph shall be limited to
      the market value of the Assets securing such liability as determined by
      the Receiver;

            

    

    

    
      	
               
      

            	
              (h)

            	
              duties
      and obligations assumed pursuant to this Agreement including without
      limitation those relating to the Failed Bank's credit card business,
      overdraft protection plans, safe deposit business, safekeeping business or
      trust business, if any;

            

    

    

    (i)           liailities,
if any, for Commitments;

    

    
      	
               
      

            	
              (j)

            	
              liabilities,
      if any, for amounts owed to any Subsidiary of the Failed Bank acquired
      under Section 3.1;

            

    

    

    (k)           liabilities,
if any, with respect to Qualified Financial Contracts;

    

    
      
        
          

           

          
            	
                  
	
                     

                  	
                     

                  
	
                     

                  	
                     

                  
	
                     

                  	 
      

          

          	
                  Module
      1 – Whole Bank w/ Loss Share – P&A

                	
                  COOPERATIVE
      BANK

                
	
                  Version
      1.05

                	
                  WILMINGTON,
      NORTH CAROLINA

                
	
                  June
      16, 2009

                	 
      

        

        
        

      

      

    

     

    
      9

      
        

      

    

    
       

    

    
    

    

    
      	
               
      

            	
              (l)

            	
              duties
      and obligations under any contract pursuant to which the Failed Bank
      provides mortgage servicing for others, or mortgage servicing is provided
      to the Failed Bank by others; and

            

    

    
    

    
      	
               
      

            	
              (m)

            	
              all
      asset-related offensive litigation liabilities and all asset-related
      defensive litigation liabilities, but only to the extent such liabilities
      relate to assets subject to a loss share agreement, and provided that all
      other defensive litigation and any  class actions with respect
      to credit card business are retained by the
  Receiver.

            

    

    

    Schedule 2.1 attached hereto and
incorporated herein sets forth certain categories of Liabilities Assumed and the
aggregate Book Value of the Liabilities Assumed in such categories. Such
schedule is based upon the best information available to the Receiver and may be
adjusted as provided in Article VIII.

    

    2.2           Interest
on Deposit Liabilities.  The Assuming Bank
agrees that, from and after Bank Closing, it will accrue and pay interest on
Deposit liabilities assumed pursuant to Section 2.1 at a rate(s) it shall
determine; provided, that for
non-transaction Deposit liabilities such rate(s) shall not be less than the
lowest rate offered by the Assuming Bank to its depositors for non-transaction
deposit accounts. The Assuming Bank shall permit each depositor to withdraw,
without penalty for early withdrawal, all or any portion of such depositor's
Deposit, whether or not the Assuming Bank elects to pay interest in accordance
with any deposit agreement formerly existing between the Failed Bank and such
depositor; and
further provided, that if such Deposit
has been pledged to secure an obligation of the depositor or other party, any
withdrawal thereof shall be subject to the terms of the agreement governing such
pledge.  The Assuming Bank shall give notice to such depositors as
provided in Section 5.3 of the rate(s) of interest which it has determined to
pay and of such withdrawal rights.

    

    2.3           Unclaimed
Deposits. If,
within eighteen (18) months after Bank Closing, any depositor of the Failed Bank
does not claim or arrange to continue such depositor's Deposit assumed pursuant
to Section 2.1 at the Assuming Bank, the Assuming Bank shall, within fifteen
(15) Business Days after the end of such eighteen (18)-month period, (i) refund
to the Corporation the full amount of each such Deposit (without reduction for
service charges), (ii) provide to the Corporation a schedule of all such
refunded Deposits in such form as may be prescribed by the Corporation, and
(iii) assign, transfer, convey and deliver to the Receiver all right, title and
interest of the Assuming Bank in and to Records previously transferred to the
Assuming Bank and other records generated or maintained by the Assuming Bank
pertaining to such Deposits. During such eighteen (18)-month period, at the
request of the Corporation, the Assuming Bank promptly shall provide to the
Corporation schedules of unclaimed deposits in such form as may be prescribed by
the Corporation.

    

    2.4           Employee
Plans. Except as
provided in Section 4.12, the Assuming Bank shall have no liabilities,
obligations or responsibilities under the Failed Bank's health care, bonus,
vacation, pension, profit sharing, deferred compensation, 401K or stock purchase
plans or similar plans, if any, unless the Receiver and the Assuming Bank agree
otherwise subsequent to the date of this Agreement.

    
      
        
          

           

          
            	
                  
	
                     

                  	
                     

                  
	
                     

                  	
                     

                  
	
                     

                  	 
      

          

          	
                  Module
      1 – Whole Bank w/ Loss Share – P&A

                	
                  COOPERATIVE
      BANK

                
	
                  Version
      1.05

                	
                  WILMINGTON,
      NORTH CAROLINA

                
	
                  June
      16, 2009

                	 
      

        

        
        

      

      

    

     

    
      10

      
        

      

    

    
       

    

    
    

    

    ARTICLE
III

    PURCHASE
OF ASSETS

    

    3.1           Assets
Purchased by Assuming Bank. With the exception of certain assets
expressly excluded in Sections 3.5 and 3.6, the Assuming Bank hereby purchases
from the Receiver, and the Receiver hereby sells, assigns, transfers, conveys,
and delivers to the Assuming Bank, all right, title, and interest of the
Receiver in and to all of the assets (real, personal and mixed, wherever located
and however acquired) including all subsidiaries, joint ventures, partnerships,
and any and all other business combinations or arrangements, whether active,
inactive, dissolved or terminated, of the Failed Bank whether or not reflected
on the books of the Failed Bank as of Bank Closing.  Schedules 3.1 and
3.1a attached hereto and incorporated herein. sets forth certain categories of
Assets purchased hereunder. Such schedule is based upon the best information
available to the Receiver and may be adjusted as provided in Article
VIII.  Assets are purchased hereunder by the Assuming Bank subject to
all liabilities for indebtedness collateralized by Liens affecting such Assets
to the extent provided in Section 2.1.  The subsidiaries, joint
ventures, partnerships, and any and all other business combinations or
arrangements, whether active, inactive, dissolved or terminated being purchased
by the Assuming Bank includes, but is not limited to, the entities listed on
Schedule 3.1a. Notwithstanding Section 4.8, the Assuming Bank specifically
purchases all mortgage servicing rights and obligations of the Failed
Bank.

    

    3.2           Asset
Purchase Price.

    

    (a)           All
Assets and assets of the Failed Bank subject to an option to purchase by the
Assuming Bank shall be purchased for the amount, or the amount resulting from
the method specified for determining the amount, as specified on Schedule 3.2,
except as otherwise may be provided herein. Any Asset, asset of the Failed Bank
subject to an option to purchase or other asset purchased for which no purchase
price is specified on Schedule 3.2 or otherwise herein shall be purchased at its
Book Value. Loans or other assets charged off the Accounting Records of the
Failed Bank prior to the date of the most recent pertinent data made available
to the Assuming Bank as part of the Information Package shall be purchased at a
price of zero.

    

    (b)  The purchase price for
securities (other than the capital stock of any Acquired Subsidiary) purchased
under Section 3.1 by the Assuming Bank shall be the market value thereof as of
Bank Closing, which market value shall be (i) the market price for each such
security quoted at the close of the trading day effective on Bank Closing as
published electronically by Bloomberg, L.P., or alternatively, at the discretion
of the Receiver, IDC/Financial Times (FT) Interactive Data; (ii) provided, that if such market
price is not available for any such security, the Assuming Bank will submit a
bid  for each such security within three days of notification/bid
request by the Receiver (unless a different time period is agreed to by the
Assuming Bank and the Receiver) and the Receiver, in its sole discretion will
accept or reject each such bid; and (iii) further provided in the
absence of an acceptable bid from the Assuming Bank, each such security shall
not pass to the Assuming Bank and shall be deemed to be an excluded asset
hereunder.

    

    (c)           Qualified
Financial Contracts shall be purchased at book value.

    
      
        
          

           

          
            	
                  
	
                     

                  	
                     

                  
	
                     

                  	
                     

                  
	
                     

                  	 
      

          

          	
                  Module
      1 – Whole Bank w/ Loss Share – P&A

                	
                  COOPERATIVE
      BANK

                
	
                  Version
      1.05

                	
                  WILMINGTON,
      NORTH CAROLINA

                
	
                  June
      16, 2009

                	 
      

        

        
        

      

      

    

     

    
      11

      
        

      

    

    
       

    

    
    

    

    3.3           Manner of
Conveyance; Limited Warranty; Nonrecourse; Etc. THE CONVEYANCE OF ALL ASSETS,
INCLUDING REAL AND PERSONAL PROPERTY INTERESTS, PURCHASED BY THE ASSUMING BANK
UNDER THIS AGREEMENT SHALL BE MADE, AS NECESSARY, BY RECEIVER'S DEED OR
RECEIVER'S BILL OF SALE, "AS IS", "WHERE IS", WITHOUT RECOURSE AND, EXCEPT AS
OTHERWISE SPECIFICALLY PROVIDED IN THIS AGREEMENT, WITHOUT ANY WARRANTIES
WHATSOEVER WITH RESPECT TO SUCH ASSETS, EXPRESS OR IMPLIED, WITH RESPECT TO
TITLE, ENFORCEABILITY, COLLECTIBILITY, DOCUMENTATION OR FREEDOM FROM LIENS OR
ENCUMBRANCES (IN WHOLE OR IN PART), OR ANY OTHER MATTERS.

    

    3.4           Puts of
Assets to the Receiver.

    

            
       (a)           Puts
Prior to the Settlement Date.

    

    (i) During the period from Bank Closing
to and including the Business Day immediately preceding the Settlement Date, the
Assuming Bank shall be entitled to require the Receiver to purchase any Asset
which the Assuming Bank can establish is evidenced by forged or stolen
instruments as of Bank Closing; provided, that, the Assuming
Bank shall not
have the right to require the Receiver to purchase any such Asset with respect
to which the Assuming Bank has taken any action referred to in Section
3.4(a)(ii) with respect to such Asset.

    

    (ii) At the end of the thirty (30)-day
period following Bank Closing and at that time only, in accordance with this
Section 3.4, the Assuming Bank shall be entitled to require the Receiver to
purchase any remaining overdraft transferred to the Assuming Bank pursuant to
3.1 which both was made after the "as of" the date of the most recent pertinent
data made available to the Assuming Bank as part of the Information Package and
was not made pursuant to an overdraft protection plan or similar extension of
credit.

    

    The
Assuming Bank shall transfer all such Assets to the Receiver without recourse,
and shall indemnify the Receiver against any and all claims of any Person
claiming by, through or under the Assuming Bank with respect to any such Asset,
as provided in Section 12.4.

    

    (b)           Notices
to the Receiver. In the event that the Assuming Bank elects to require
the Receiver to purchase one or more Assets, the Assuming Bank shall deliver to
the Receiver a notice (a "Put Notice") which shall include:

    

    
      	
               
      

            	
              (i)

            	
              a
      list of all Assets that the Assuming Bank requires the Receiver to
      purchase;

            

    

    

    
      	
               
      

            	
              (ii)

            	
              a
      list of all Related Liabilities with respect to the Assets identified
      pursuant to (i) above; and

            

    

    

    
      	
               
      

            	
              (iii)

            	
              a
      statement of the estimated Repurchase Price of each Asset identified
      pursuant to (i) above as of the applicable Put
  Date.

            

    

    
      
        
          

           

          
            	
                  
	
                     

                  	
                     

                  
	
                     

                  	
                     

                  
	
                     

                  	 
      

          

          	
                  Module
      1 – Whole Bank w/ Loss Share – P&A

                	
                  COOPERATIVE
      BANK

                
	
                  Version
      1.05

                	
                  WILMINGTON,
      NORTH CAROLINA

                
	
                  June
      16, 2009

                	 
      

        

        
        

      

      

    

     

    
      12

      
        

      

    

    
       

    

    
    

    

    Such
notice shall be in the form prescribed by the Receiver or such other form to
which the Receiver shall consent. As provided in Section 9.6, the Assuming Bank
shall deliver to the Receiver such documents, Credit Files and such additional
information relating to the subject matter of the Put Notice as the Receiver may
request and shall provide to the Receiver full access to all other relevant
books and records.

    

    (c)           Purchase
by Receiver. The Receiver shall purchase Assets that are specified in the
Put Notice and shall assume Related Liabilities with respect to such Assets, and
the transfer of such Assets and Related Liabilities shall be effective as of a
date determined by the Receiver which date shall not be later than thirty (30)
days after receipt by the Receiver of the Put Notice (the "Put
Date").

    

    (d)           Purchase
Price and Payment Date.  Each Asset purchased by the Receiver
pursuant to this Section 3.4 shall be purchased at a price equal to the
Repurchase Price of such Asset less the Related Liability Amount applicable to
such Asset, in each case determined as of the applicable Put Date. If the
difference between such Repurchase Price and such Related Liability Amount is
positive, then the Receiver shall pay to the Assuming Bank the amount of such
difference; if the difference between such amounts is negative, then the
Assuming Bank shall pay to the Receiver the amount of such difference. The
Assuming Bank or the Receiver, as the case may be, shall pay the purchase price
determined pursuant to this Section 3.4(d) not later than the twentieth (20th)
Business Day following the applicable Put Date, together with interest on such
amount at the Settlement Interest Rate for the period from and including such
Put Date to and including the day preceding the date upon which payment is
made.

    

    (e)           Servicing. The Assuming Bank shall
administer and manage any Asset subject to purchase by the Receiver in
accordance with usual and prudent banking standards and business practices until
such time as such Asset is purchased by the Receiver.

    

    (f)           Reversals.
In the event that the Receiver purchases an Asset (and assumes the Related
Liability) that it is not required to purchase pursuant to this Section 3.4, the
Assuming Bank shall repurchase such Asset (and assume such Related Liability)
from the Receiver at a price computed so as to achieve the same economic result
as would apply if the Receiver had never purchased such Asset pursuant to this
Section 3.4.

    

    3.5           Assets
Not Purchased by Assuming Bank. The Assuming Bank does not purchase,
acquire or assume, or (except as otherwise expressly provided in this Agreement)
obtain an option to purchase, acquire or assume under this
Agreement:

    

    (a)           any
financial institution bonds, banker's blanket bonds, or public liability, fire,
or extended coverage insurance policy or any other insurance policy of the
Failed Bank, or premium refund, unearned premium derived from cancellation, or
any proceeds payable with respect to any of the foregoing;

    

    (b)           any
interest, right, action, claim, or judgment against (i) any officer, director,
employee, accountant, attorney, or any other Person employed or retained by the
Failed Bank or

    
      
        
          

           

          
            	
                  
	
                     

                  	
                     

                  
	
                     

                  	
                     

                  
	
                     

                  	 
      

          

          	
                  Module
      1 – Whole Bank w/ Loss Share – P&A

                	
                  COOPERATIVE
      BANK

                
	
                  Version
      1.05

                	
                  WILMINGTON,
      NORTH CAROLINA

                
	
                  June
      16, 2009

                	 
      

        

        
        

      

      

    

     

    
      13

      
        

      

    

    
       

    

    
    

    any
Subsidiary of the Failed Bank on or prior to Bank Closing arising out of any act
or omission of such Person in such capacity, (ii) any underwriter of financial
institution bonds, banker's blanket bonds or any other insurance policy of the
Failed Bank, (iii) any shareholder or holding company of the Failed Bank, or
(iv) any other Person whose action or inaction may be related to any loss
(exclusive of any loss resulting from such Person's failure to pay on a Loan
made by the Failed Bank) incurred by the Failed Bank; provided, that for the purposes
hereof, the acts, omissions or other events giving rise to any such claim shall
have occurred on or before Bank Closing, regardless of when any such claim is
discovered and regardless of whether any such claim is made with respect to a
financial institution bond, banker's blanket bond, or any other insurance policy
of the Failed Bank in force as of Bank Closing;

    

    (c)           prepaid
regulatory assessments of the Failed Bank, if any;

    

    (d)           legal
or equitable interests in tax receivables of the Failed Bank, if any, including
any claims arising as a result of the Failed Bank having entered into any
agreement or otherwise being joined with another Person with respect to the
filing of tax returns or the payment of taxes;

    

    (e)           amounts
reflected on the Accounting Records of the Failed Bank as of Bank Closing as a
general or specific loss reserve or contingency account, if any;

    

    (f)           leased
or owned Bank Premises and leased or owned Furniture and Equipment and Fixtures
and data processing equipment (including hardware and software) located on
leased or owned Bank Premises, if any; provided, that the Assuming
Bank does obtain an option under Section 4.6, Section 4.7 or Section 4.8, as the
case may be, with respect thereto;

    

    (g)           owned
Bank Premises which the Receiver, in its discretion, determines may contain
environmentally hazardous substances;

    

    (h)           any
"goodwill," as such term is defined in the instructions to the report of
condition prepared by banks examined by the Corporation in accordance with 12
C.F.R. Section 304.4, and other intangibles;

    

    (i)           any
criminal restitution or forfeiture orders issued in favor of the Failed
Bank;

    

    (j)           reserved;

    

    (k)           assets
essential to the Receiver in accordance with Section 3.6; and

    

    (l)           all
private label asset-backed securities, including, but not limited to, those
listed on the attached Schedule 3.5(l).

    
      
        
          

           

          
            	
                  
	
                     

                  	
                     

                  
	
                     

                  	
                     

                  
	
                     

                  	 
      

          

          	
                  Module
      1 – Whole Bank w/ Loss Share – P&A

                	
                  COOPERATIVE
      BANK

                
	
                  Version
      1.05

                	
                  WILMINGTON,
      NORTH CAROLINA

                
	
                  June
      16, 2009

                	 
      

        

        
        

      

      

    

     

    
      14

      
        

      

    

    
       

    

    
    

    

    

    3.6           Retention
or Repurchase of Assets
Essential to Receiver.

    

    (a)           The
Receiver may refuse to sell to the Assuming Bank, or the Assuming Bank agrees,
at the request of the Receiver set forth in a written notice to the Assuming
Bank, to assign, transfer, convey, and deliver to the Receiver all of the
Assuming Bank's right, title and interest in and to, any Asset or asset
essential to the Receiver as determined by the Receiver in its discretion
(together with all Credit Documents evidencing or pertaining thereto), which may
include any Asset or asset that the Receiver determines to be:

    

    
      	
               
      

            	
              (i)

            	
              made
      to an officer, director, or other Person engaging in the affairs of the
      Failed Bank, its Subsidiaries or Affiliates or any related entities of any
      of the foregoing;

            

    

    

    
      	
               
      

            	
              (ii)

            	
              the
      subject of any investigation relating to any claim with respect to any
      item described in Section 3.5(a) or (b), or the subject of, or potentially
      the subject of, any legal
proceedings;

            

    

    

    
      	
               
      

            	
              (iii)

            	
              made
      to a Person who is an Obligor on a loan owned by the Receiver or the
      Corporation in its corporate capacity or its capacity as receiver of any
      institution;

            

    

    

    
      	
               
      

            	
              (iv)

            	
              secured
      by collateral which also secures any asset owned by the Receiver;
      or

            

    

    

    
      	
               
      

            	
              (v)

            	
              related
      to any asset of the Failed Bank not purchased by the Assuming Bank under
      this Article III or any liability of the Failed Bank not assumed by the
      Assuming Bank under Article II.

            

    

    

    (b)           Each
such Asset or asset purchased by the Receiver shall be purchased at a price
equal to the Repurchase Price thereof less the Related Liability Amount with
respect to any Related Liabilities related to such Asset or asset, in each case
determined as of the date of the notice provided by the Receiver pursuant to
Section 3.6(a). The Receiver shall pay the Assuming Bank not later than the
twentieth (20th) Business Day following receipt of related Credit Documents and
Credit Files together with interest on such amount at the Settlement Interest
Rate for the period from and including the date of receipt of such documents to
and including the day preceding the day on which payment is made. The Assuming
Bank agrees to administer and manage each such Asset or asset in accordance with
usual and prudent banking standards and business practices until each such Asset
or asset is purchased by the Receiver. All transfers with respect to Asset or
assets under this Section 3.6 shall be made as provided in Section 9.6. The
Assuming Bank shall transfer all such Asset or assets and Related Liabilities to
the Receiver without recourse, and shall indemnify the Receiver against any and
all claims of any Person claiming by, through or under the Assuming Bank with
respect to any such Asset or asset, as provided in Section
12.4.

    
      
        
          

           

          
            	
                  
	
                     

                  	
                     

                  
	
                     

                  	
                     

                  
	
                     

                  	 
      

          

          	
                  Module
      1 – Whole Bank w/ Loss Share – P&A

                	
                  COOPERATIVE
      BANK

                
	
                  Version
      1.05

                	
                  WILMINGTON,
      NORTH CAROLINA

                
	
                  June
      16, 2009

                	 
      

        

        
        

      

      

    

     

    
      15

      
        

      

    

    
       

    

    
    

    ARTICLE
IV

    ASSUMPTION
OF CERTAIN DUTIES AND OBLIGATIONS

    

    The Assuming Bank agrees with the
Receiver and the Corporation as follows:

    

    4.1           Continuation
of Banking Business. For the period commencing the first banking
business day after Bank Closing and ending no earlier than the first anniversary
of Bank Closing, the Assuming Bank agrees to provide full service banking in the
trade area of the Failed Bank.   Thereafter, the Assuming Bank may
cease providing such banking services in the trade area of the Failed Bank,
provided the Assuming Bank has received all necessary regulatory
approvals.  The trade area shall be determined by the
Receiver.

    

    4.2           Agreement
with Respect to Credit Card Business. The Assuming Bank agrees to honor
and perform, from and after Bank Closing, all duties and obligations with
respect to the Failed Bank's credit card business, and/or processing related to
credit cards, if any, and assumes all outstanding extensions of credit with
respect thereto.

    

    4.3           Agreement
with Respect to Safe Deposit Business. The Assuming Bank assumes and
agrees to discharge, from and after Bank Closing, in the usual course of
conducting a banking business, the duties and obligations of the Failed Bank
with respect to all Safe Deposit Boxes, if any, of the Failed Bank and to
maintain all of the necessary facilities for the use of such boxes by the
renters thereof during the period for which such boxes have been rented and the
rent therefore paid to the Failed Bank, subject to the provisions of the rental
agreements between the Failed Bank and the respective renters of such boxes;
provided, that the Assuming
Bank may relocate the Safe Deposit Boxes of the Failed Bank to any office of the
Assuming Bank located in the trade area of the Failed Bank. The Safe Deposit
Boxes shall be located and maintained in the trade area of the Failed Bank for a
minimum of one year from Bank Closing. Fees related to the safe deposit business
earned prior to the Bank Closing Date shall be for the benefit of the Receiver
and fees earned after the Bank Closing Date shall be for the benefit of the
Assuming Bank.

    4.4           Agreement
with Respect to Safekeeping Business. The Receiver transfers, conveys and
delivers to the Assuming Bank and the Assuming Bank accepts all securities and
other items, if any, held by the Failed Bank in safekeeping for its customers as
of Bank Closing. The Assuming Bank assumes and agrees to honor and discharge,
from and after Bank Closing, the duties and obligations of the Failed Bank with
respect to such securities and items held in safekeeping. The Assuming Bank
shall be entitled to all rights and benefits heretofore accrued or hereafter
accruing with respect thereto. The Assuming Bank shall provide to the Receiver
written verification of all assets held by the Failed Bank for safekeeping
within sixty (60) days after Bank Closing.  The assets held for safekeeping
by the Failed Bank shall be held and maintained by the Assuming Bank in the
trade area of the Failed Bank for a minimum of one year from Bank Closing. 
Fees related to the safekeeping business earned prior to the Bank Closing Date
shall be for the benefit of the Receiver and fees earned after the Bank Closing
Date shall be for the benefit of the Assuming Bank.

    

    4.5           Agreement
with Respect to Trust Business.

    
      
        
          

           

          
            	
                  
	
                     

                  	
                     

                  
	
                     

                  	
                     

                  
	
                     

                  	 
      

          

          	
                  Module
      1 – Whole Bank w/ Loss Share – P&A

                	
                  COOPERATIVE
      BANK

                
	
                  Version
      1.05

                	
                  WILMINGTON,
      NORTH CAROLINA

                
	
                  June
      16, 2009

                	 
      

        

        
        

      

      

    

     

    
      16

      
        

      

    

    
       

    

    
    

    (a)           The
Assuming Bank shall, without further transfer, substitution, act or deed, to the
full extent permitted by law, succeed to the rights, obligations, properties,
assets, investments, deposits, agreements, and trusts of the Failed Bank under
trusts, executorships, administrations, guardianships, and agencies, and other
fiduciary or representative capacities, all to the same extent as though the
Assuming Bank had assumed the same from the Failed Bank prior to Bank Closing;
provided, that any liability
based on the misfeasance, malfeasance or nonfeasance of the Failed Bank, its
directors, officers, employees or agents with respect to the trust business is
not assumed hereunder.

    

    (b)           The
Assuming Bank shall, to the full extent permitted by law, succeed to, and be
entitled to take and execute, the appointment to all executorships,
trusteeships, guardianships and other fiduciary or representative capacities to
which the Failed Bank is or may be named in wills, whenever probated, or to
which the Failed Bank is or may be named or appointed by any other
instrument.

    

    (c)           In
the event additional proceedings of any kind are necessary to accomplish the
transfer of such trust business, the Assuming Bank agrees that, at its own
expense, it will take whatever action is necessary to accomplish such transfer.
The Receiver agrees to use reasonable efforts to assist the Assuming Bank in
accomplishing such transfer.

    

    (d)           The
Assuming Bank shall provide to the Receiver written verification of the assets
held in connection with the Failed Bank's trust business within sixty (60) days
after Bank Closing.

    

    4.6           Agreement
with Respect to Bank Premises.

    

         
      (a)           Option to
Purchase. Subject
to Section 3.5, the Receiver hereby grants to the Assuming Bank an exclusive
option for the period of ninety (90) days commencing the day after Bank Closing
to purchase any or all owned Bank Premises, including all Furniture, Fixtures
and Equipment located on the Bank Premises. The Assuming Bank shall give written
notice to the Receiver within the option period of its election to purchase or
not to purchase any of the owned Bank Premises. Any purchase of such premises
shall be effective as of the date of Bank Closing and such purchase shall be
consummated as soon as practicable thereafter, and in no event later than the
Settlement Date.

    

    (b)           Option to
Lease. The
Receiver hereby grants to the Assuming Bank an exclusive option for the period
of ninety (90) days commencing the day after Bank Closing to cause the Receiver
to assign to the Assuming Bank any or all leases for leased Bank Premises, if
any, which have been continuously occupied by the Assuming Bank from Bank
Closing to the date it elects to accept an assignment of the leases with respect
thereto to the extent such leases can be assigned; provided, that the exercise of
this option with respect to any lease must be as to all premises or other
property subject to the lease. If an assignment cannot be made of any such
leases, the Receiver may, in its discretion, enter into subleases with the
Assuming Bank containing the same terms and conditions provided under such
existing leases for such leased Bank Premises or other property. The Assuming
Bank shall give notice to the Receiver within the option period of its election
to accept or not to accept an assignment of any or all leases
(or

    
      
        
          

           

          
            	
                  
	
                     

                  	
                     

                  
	
                     

                  	
                     

                  
	
                     

                  	 
      

          

          	
                  Module
      1 – Whole Bank w/ Loss Share – P&A

                	
                  COOPERATIVE
      BANK

                
	
                  Version
      1.05

                	
                  WILMINGTON,
      NORTH CAROLINA

                
	
                  June
      16, 2009

                	 
      

        

        
        

      

      

    

     

    
      17

      
        

      

    

    
       

    

    
    

    enter
into subleases or new leases in lieu thereof). The Assuming Bank agrees to
assume all leases assigned (or enter into subleases or new leases in lieu
thereof) pursuant to this Section 4.6.

    

    (c)           Facilitation. The Receiver agrees to
facilitate the assumption, assignment or sublease of leases or the negotiation
of new leases by the Assuming Bank; provided, that neither the
Receiver nor the Corporation shall be obligated to engage in litigation, make
payments to the Assuming Bank or to any third party in connection with
facilitating any such assumption, assignment, sublease or negotiation or commit
to any other obligations to third parties.

    

    (d)           Occupancy. The Assuming Bank shall give
the Receiver fifteen (15) days' prior written notice of its intention to vacate
prior to vacating any leased Bank Premises with respect to which the Assuming
Bank has not exercised the option provided in Section 4.6(b). Any such notice
shall be deemed to terminate the Assuming Bank's option with respect to such
leased Bank Premises.

    

    (e)           Occupancy
Costs.

    

    (i)           The
Assuming Bank agrees to pay to the Receiver, or to appropriate third parties at
the direction of the Receiver, during and for the period of any occupancy by it
of (x) owned Bank Premises the market rental value, as determined by the
appraiser selected in accordance with the definition of Fair Market Value, and
all operating costs, and (y) leased Bank Premises, all operating costs with
respect thereto and to comply with all relevant terms of applicable leases
entered into by the Failed Bank, including without limitation the timely payment
of all rent. Operating costs include, without limitation all taxes, fees,
charges, utilities, insurance and assessments, to the extent not included in the
rental value or rent. If the Assuming Bank elects to purchase any owned Bank
Premises in accordance with Section 4.6(a), the amount of any rent paid (and
taxes paid to the Receiver which have not been paid to the taxing authority and
for which the Assuming Bank assumes liability) by the Assuming Bank with respect
thereto shall be applied as an offset against the purchase price
thereof.

     

    (ii)           The
Assuming Bank agrees during the period of occupancy by it of owned or leased
Bank Premises, to pay to the Receiver rent for the use of all owned or leased
Furniture and Equipment and all owned or leased Fixtures located on such Bank
Premises for the period of such occupancy. Rent for such property owned by the
Failed Bank shall be the market rental value thereof, as determined by the
Receiver within sixty (60) days after Bank Closing. Rent for such leased
property shall be an amount equal to any and all rent and other amounts which
the Receiver incurs or accrues as an obligation or is obligated to pay for such
period of occupancy pursuant to all leases and contracts with respect to such
property. If the Assuming Bank purchases any owned Furniture and Equipment or
owned Fixtures in accordance with Section 4.6(f) or 4.6(h), the amount of any
rents paid by the Assuming Bank with respect thereto shall be applied as an
offset against the purchase price thereof.

    

    (f)           Certain
Requirements as to Furniture, Equipment and Fixtures. If the Assuming Bank
purchases owned Bank Premises or accepts an assignment of the lease (or enters
into a sublease or a new lease in lieu thereof) for leased Bank Premises as
provided in Section

    
      
        
          

           

          
            	
                  
	
                     

                  	
                     

                  
	
                     

                  	
                     

                  
	
                     

                  	 
      

          

          	
                  Module
      1 – Whole Bank w/ Loss Share – P&A

                	
                  COOPERATIVE
      BANK

                
	
                  Version
      1.05

                	
                  WILMINGTON,
      NORTH CAROLINA

                
	
                  June
      16, 2009

                	 
      

        

        
        

      

      

    

     

    
      18

      
        

      

    

    
       

    

    
    

    4.6(a) or
4.6(b), or if the Assuming Bank does not exercise such option but within twelve
(12) months following Bank Closing obtains the right to occupy such premises
(whether by assignment, lease, sublease, purchase or otherwise), other than in
accordance with Section 4.6(a) or (b), the Assuming Bank shall
(i) effective as of the date of Bank Closing, purchase from the Receiver
all Furniture and Equipment and Fixtures owned by the Failed Bank at Fair Market
Value and located thereon as of Bank Closing, (ii) accept an assignment or
a sublease of the leases or negotiate new leases for all Furniture and Equipment
and Fixtures leased by the Failed Bank and located thereon, and (iii) if
applicable, accept an assignment or a sublease of any ground lease or negotiate
a new ground lease with respect to any land on which such Bank Premises are
located; provided, that the Receiver
shall not have disposed of such Furniture and Equipment and Fixtures or
repudiated the leases specified in clause (ii) or (iii).

    

    (g)           Vacating
Premises.

    

    (i)           If
the Assuming Bank elects not to purchase any owned Bank Premises, the notice of
such election in accordance with Section 4.6(a) shall specify the date upon
which the Assuming Bank's occupancy of such premises shall terminate, which date
shall not be later than ninety (90) days after the date of the Assuming Bank's
notice not to exercise such option. The Assuming Bank promptly shall relinquish
and release to the Receiver such premises and the Furniture and Equipment and
Fixtures located thereon in the same condition as at Bank Closing, normal wear
and tear excepted. By occupying any such premises after the expiration of such
ninety (90)-day period, the Assuming Bank shall, at the Receiver's option, (x)
be deemed to have agreed to purchase such Bank Premises, and to assume all
leases, obligations and liabilities with respect to leased Furniture and
Equipment and leased Fixtures located thereon and any ground lease with respect
to the land on which such premises are located, and (y) be required to purchase
all Furniture and Equipment and Fixtures owned by the Failed Bank and located on
such premises as of Bank Closing.

    

    (ii)           If
the Assuming Bank elects not to accept an assignment of the lease or sublease
any leased Bank Premises, the notice of such election in accordance with Section
4.6(b) shall specify the date upon which the Assuming Bank's occupancy of such
leased Bank Premises shall terminate, which date shall not be later than the
date which is one hundred eighty (180) days after Bank Closing. Upon vacating
such premises, the Assuming Bank shall relinquish and release to the Receiver
such premises and the Fixtures and the Furniture and Equipment located thereon
in the same condition as at Bank Closing, normal wear and tear excepted. By
failing to provide notice of its intention to vacate such premises prior to the
expiration of the option period specified in Section 4.6(b), or by occupying
such premises after the one hundred eighty (180)-day period specified above in
this paragraph (ii), the Assuming Bank shall, at the Receiver's option,
(x) be deemed to have assumed all leases, obligations and liabilities with
respect to such premises (including any ground lease with respect to the land on
which premises are located), and leased Furniture and Equipment and leased
Fixtures located thereon in accordance with this Section 4.6 (unless the
Receiver previously repudiated any such lease), and (y) be required to
purchase all Furniture and Equipment and Fixtures owned by the Failed Bank at
Fair Market Value and located on such premises as of Bank Closing.

    

    
      
        
          

           

          
            	
                  
	
                     

                  	
                     

                  
	
                     

                  	
                     

                  
	
                     

                  	 
      

          

          	
                  Module
      1 – Whole Bank w/ Loss Share – P&A

                	
                  COOPERATIVE
      BANK

                
	
                  Version
      1.05

                	
                  WILMINGTON,
      NORTH CAROLINA

                
	
                  June
      16, 2009

                	 
      

        

        
        

      

      

    

     

    
      19

      
        

      

    

    
       

    

    
    

    (h)           Furniture
and Equipment and Certain Other Equipment. The Receiver hereby grants
to the Assuming Bank an option to purchase all Furniture and
Equipment or any telecommunications, data processing equipment (including
hardware and software) and check processing and similar operating equipment
owned by the Failed Bank at Fair Market Value and located at any leased Bank
Premises that the Assuming Bank elects to vacate or which it could have, but did
not occupy, pursuant to this Section 4.6; provided, that, the Assuming
Bank shall give the Receiver notice of its election to purchase such property at
the time it gives notice of its intention to vacate such Bank Premises or within
ten (10) days after Bank Closing for Bank Premises it could have, but did not,
occupy.

    

    4.7           Agreement with Respect to
Leased Data Processing Equipment

    

    (a)           The
Receiver hereby grants to the Assuming Bank an exclusive option for the period
of ninety (90) days commencing the day after Bank Closing to accept an
assignment from the Receiver of any or all Data Processing Leases to the extent
that such Data Processing Leases can be assigned.

    

    (b)           The
Assuming Bank shall (i) give written notice to the Receiver within the option
period specified in Section 4.7(a) of its intent to accept or decline an
assignment or sublease of any or all Data Processing Leases and promptly accept
an assignment or sublease of such Data Processing Leases, and (ii) give written
notice to the appropriate lessor(s) that it has accepted an assignment or
sublease of any such Data Processing Leases.

    

    (c)           The
Receiver agrees to facilitate the assignment or sublease of Data Processing
Leases or the negotiation of new leases or license agreements by the Assuming
Bank; provided,
that neither
the Receiver nor the Corporation shall be obligated to engage in litigation or
make payments to the Assuming Bank or to any third party in connection with
facilitating any such assumption, assignment, sublease or
negotiation.

    

    (d)           The
Assuming Bank agrees, during its period of use of any property subject to a Data
Processing Lease, to pay to the Receiver or to appropriate third parties at the
direction of the Receiver all operating costs with respect thereto and to comply
with all relevant terms of the applicable Data Processing Leases entered into by
the Failed Bank, including without limitation the timely payment of all rent,
taxes, fees, charges, utilities, insurance and assessments.

    

    (e)           The
Assuming Bank shall, not later than fifty (50) days after giving the notice
provided in Section 4.7(b), (i) relinquish and release to the Receiver all
property subject to the relevant Data Processing Lease, in the same condition as
at Bank Closing, normal wear and tear excepted, or (ii) accept an assignment or
a sublease thereof or negotiate a new lease or license agreement under this
Section 4.7.

    

    4.8           Agreement
with Respect to Certain Existing Agreements.

    

        
           (a)           Subject
to the provisions of Section 4.8(b), with respect to agreements existing as of
Bank Closing which provide for the rendering of services by or to the Failed
Bank, within ninety (90) days after Bank Closing, the Assuming Bank shall give
the Receiver written notice

    
      
        
          

           

          
            	
                  
	
                     

                  	
                     

                  
	
                     

                  	
                     

                  
	
                     

                  	 
      

          

          	
                  Module
      1 – Whole Bank w/ Loss Share – P&A

                	
                  COOPERATIVE
      BANK

                
	
                  Version
      1.05

                	
                  WILMINGTON,
      NORTH CAROLINA

                
	
                  June
      16, 2009

                	 
      

        

        
        

      

      

    

     

    
      20

      
        

      

    

    
       

    

    
    

    specifying
whether it elects to assume or not to assume each such agreement. Except as may
be otherwise provided in this Article IV, the Assuming Bank agrees to comply
with the terms of each such agreement for a period commencing on the day after
Bank Closing and ending on: (i) in the case of an agreement that provides for
the rendering of services by the Failed Bank, the date which is ninety (90) days
after Bank Closing, and (ii) in the case of an agreement that provides for the
rendering of services to the Failed Bank, the date which is thirty (30) days
after the Assuming Bank has given notice to the Receiver of its election not to
assume such agreement; provided, that the Receiver can
reasonably make such service agreements available to the Assuming Bank. The
Assuming Bank shall be deemed by the Receiver to have assumed agreements for
which no notification is timely given. The Receiver agrees to assign, transfer,
convey, and deliver to the Assuming Bank all right, title and interest of the
Receiver, if any, in and to agreements the Assuming Bank assumes hereunder. In
the event the Assuming Bank elects not to accept an assignment of any lease (or
sublease) or negotiate a new lease for leased Bank Premises under Section 4.6
and does not otherwise occupy such premises, the provisions of this Section
4.8(a) shall not apply to service agreements related to such premises. The
Assuming Bank agrees, during the period it has the use or benefit of any such
agreement, promptly to pay to the Receiver or to appropriate third parties at
the direction of the Receiver all operating costs with respect thereto and to
comply with all relevant terms of such agreement.

    

    (b)           The
provisions of Section 4.8(a) regarding the Assuming Bank’s election to assume or
not assume certain agreements shall not apply to (i) agreements pursuant to
which the Failed Bank provides mortgage servicing for others or mortgage
servicing is provided to the Failed Bank by others, (ii) agreements that are
subject to Sections 4.1 through 4.7 and any insurance policy or bond referred to
in Section 3.5(a) or other agreement specified in Section 3.5, and (iii)
consulting, management or employment agreements, if any, between the Failed Bank
and its employees or other Persons. Except as otherwise expressly set forth
elsewhere in this Agreement, the Assuming Bank does not assume any liabilities
or acquire any rights under any of the agreements described in this Section
4.8(b).

    

    4.9           Informational
Tax Reporting. The Assuming Bank agrees to perform all obligations of the
Failed Bank with respect to Federal and State income tax informational reporting
related to (i) the Assets and the Liabilities Assumed, (ii) deposit
accounts that were closed and loans that were paid off or collateral obtained
with respect thereto prior to Bank Closing, (iii) miscellaneous payments made to
vendors of the Failed Bank, and (iv) any other asset or liability of the Failed
Bank, including, without limitation, loans not purchased and Deposits not
assumed by the Assuming Bank, as may be required by the Receiver.

    

    4.10           Insurance.
The Assuming Bank agrees to obtain insurance coverage effective from and after
Bank Closing, including public liability, fire and extended coverage insurance
acceptable to the Receiver with respect to owned or leased Bank Premises that it
occupies, and all owned or leased Furniture and Equipment and Fixtures and
leased data processing equipment (including hardware and software) located
thereon, in the event such insurance coverage is not already in force and effect
with respect to the Assuming Bank as the insured as of Bank Closing. All such
insurance shall, where appropriate (as determined by the Receiver), name the
Receiver as an additional insured.

    
      
        
          

           

          
            	
                  
	
                     

                  	
                     

                  
	
                     

                  	
                     

                  
	
                     

                  	 
      

          

          	
                  Module
      1 – Whole Bank w/ Loss Share – P&A

                	
                  COOPERATIVE
      BANK

                
	
                  Version
      1.05

                	
                  WILMINGTON,
      NORTH CAROLINA

                
	
                  June
      16, 2009

                	 
      

        

        
        

      

      

    

     

    
      21

      
        

      

    

    
       

    

    
    

    4.11           Office
Space for Receiver and Corporation.  For the period commencing
on the day following Bank Closing and ending on the one hundred eightieth
(180th) day thereafter, the Assuming Bank agrees to provide to the Receiver and
the Corporation, without charge, adequate and suitable office space (including
parking facilities and vault space), furniture, equipment (including
photocopying and telecopying machines), email accounts, network access and
technology resources (such as shared drive) and utilities (including local
telephone service and fax machines) at the Bank Premises occupied by the
Assuming Bank for their use in the discharge of their respective functions with
respect to the Failed Bank. In the event the Receiver and the Corporation
determine that the space provided is inadequate or unsuitable, the Receiver and
the Corporation may relocate to other quarters having adequate and suitable
space and the costs of relocation and any rental and utility costs for the
balance of the period of occupancy by the Receiver and the Corporation shall be
borne by the Assuming Bank.  Additionally, the Assuming Bank agrees to
pay such bills and invoices on behalf of the Receiver and Corporation as the
Receiver or Corporation may direct for the period beginning on the date of Bank
Closing and ending on Settlement Date.  Assuming Bank shall submit it
requests for reimbursement of such expenditures pursuant to Article VIII of this
Agreement.

    

    

    4.12           Agreement with Respect to
Continuation of Group Health Plan Coverage for Former Employees of the Failed
Bank.

    

    (a)           The
Assuming Bank agrees to assist the Receiver, as provided in this Section 4.12,
in offering individuals who were employees or former employees of the Failed
Bank, or any of its Subsidiaries, and who, immediately prior to Bank Closing,
were receiving, or were eligible to receive, health insurance coverage or health
insurance continuation coverage from the Failed Bank ("Eligible Individuals"),
the opportunity to obtain health insurance coverage in the Corporation's FIA
Continuation Coverage Plan which provides for health insurance continuation
coverage to such Eligible Individuals who are qualified beneficiaries of the
Failed Bank as defined in Section 607 of the Employee Retirement Income Security
Act of 1974, as amended (respectively, "qualified beneficiaries" and "ERISA").
The Assuming Bank shall consult with the Receiver and not later than five (5)
Business Days after Bank Closing shall provide written notice to the Receiver of
the number (if available), identity (if available) and addresses (if available)
of the Eligible Individuals who are qualified beneficiaries of the Failed Bank
and for whom a "qualifying event" (as defined in Section 603 of ERISA) has
occurred and with respect to whom the Failed Bank's obligations under Part 6 of
Subtitle B of Title I of ERISA have not been satisfied in full, and such other
information as the Receiver may reasonably require. The Receiver shall cooperate
with the Assuming Bank in order to permit it to prepare such notice and shall
provide to the Assuming Bank such data in its possession as may be reasonably
required for purposes of preparing such notice.

    

    (b)           The
Assuming Bank shall take such further action to assist the Receiver in offering
the Eligible Individuals who are qualified beneficiaries of the Failed Bank the
opportunity to obtain health insurance coverage in the Corporation's FIA
Continuation Coverage Plan as the Receiver may direct. All expenses incurred and
paid by the Assuming Bank (i) in connection with the obligations of the Assuming
Bank under this Section 4.12, and (ii) in providing health insurance
continuation coverage to any Eligible Individuals who are hired
by

    
      
        
          

           

          
            	
                  
	
                     

                  	
                     

                  
	
                     

                  	
                     

                  
	
                     

                  	 
      

          

          	
                  Module
      1 – Whole Bank w/ Loss Share – P&A

                	
                  COOPERATIVE
      BANK

                
	
                  Version
      1.05

                	
                  WILMINGTON,
      NORTH CAROLINA

                
	
                  June
      16, 2009

                	 
      

        

        
        

      

      

    

     

    
      22

      
        

      

    

    
       

    

    
    

    the
Assuming Bank and such employees' qualified beneficiaries shall be borne by the
Assuming Bank.

    

    (c)           This
Section 4.12 is for the sole and exclusive benefit of the parties to this
Agreement, and for the benefit of no other Person (including any former employee
of the Failed Bank or any Subsidiary thereof or qualified beneficiary of such
former employee). Nothing in this Section 4.12 is intended by the parties, or
shall be construed, to give any Person (including any former employee of the
Failed Bank or any Subsidiary thereof or qualified beneficiary of such former
employee) other than the Corporation, the Receiver and the Assuming Bank any
legal or equitable right, remedy or claim under or with respect to the
provisions of this Section.

    

    
      4.13       
 Agreement
with Respect to Interim Asset Servicing. At any time after Bank
Closing,
the Receiver may establish on its books an asset pool(s) and may transfer to
such asset pool(s) (by means of accounting entries on the books of the Receiver)
all or any assets and liabilities of the Failed Bank which are not acquired by
the Assuming Bank, including, without limitation, wholly unfunded Commitments
and assets and liabilities which may be acquired, funded or originated by the
Receiver subsequent to Bank Closing. The Receiver may remove assets (and
liabilities) from or add assets (and liabilities) to such pool(s) at any time in
its discretion. At the option of the Receiver, the Assuming Bank agrees to
service, administer, and collect such pool assets in accordance with and for the
term set forth in Exhibit 4.13 "Interim Asset Servicing
Arrangement".

    

    

    
      	
               
      

            	
              4.14

            	
              Reserved.

            

    

    

    
      4.15     
 Agreement
with Respect to Loss Sharing.  The Assuming Bank
shall be entitled to
require reimbursement from the Receiver for loss sharing on certain loans in
accordance with the Single Family Shared-Loss Agreement attached hereto as
Exhibit 4.15A and the Non-SF Shared-Loss Agreement attached hereto as Exhibit
4.15B, collectively, the “Shared-Loss Agreements.”  The Loans that
shall be subject to the Shared-Loss Agreements are identified on the Schedule of
Loans 4.15A and 4.15B attached hereto.

    

    

    

    

    ARTICLE
V

    DUTIES
WITH RESPECT TO DEPOSITORS OF THE FAILED BANK

    

    5.1           Payment
of Checks, Drafts and Orders. Subject to Section 9.5, the
Assuming Bank agrees to pay all properly drawn checks, drafts and withdrawal
orders of depositors of the Failed Bank presented for payment, whether drawn on
the check or draft forms provided by the Failed Bank or by the Assuming Bank, to
the extent that the Deposit balances to the credit of the respective makers or
drawers assumed by the Assuming Bank under this Agreement are sufficient to
permit the payment thereof, and in all other respects to discharge, in the usual
course of conducting a banking business, the duties and obligations of the
Failed Bank with respect to the Deposit balances due and owing to the depositors
of the Failed Bank assumed by the Assuming Bank under this
Agreement.

    
      
        
          

           

          
            	
                  
	
                     

                  	
                     

                  
	
                     

                  	
                     

                  
	
                     

                  	 
      

          

          	
                  Module
      1 – Whole Bank w/ Loss Share – P&A

                	
                  COOPERATIVE
      BANK

                
	
                  Version
      1.05

                	
                  WILMINGTON,
      NORTH CAROLINA

                
	
                  June
      16, 2009

                	 
      

        

        
        

      

      

    

     

    
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    5.2           Certain
Agreements Related to Deposits. Subject to Section 2.2, the
Assuming Bank agrees to honor the terms and conditions of any written escrow or
mortgage servicing agreement or other similar agreement relating to a Deposit
liability assumed by the Assuming Bank pursuant to this Agreement.

    

    5.3           Notice to
Depositors.

    

    (a)           Within
seven (7) days after Bank Closing, the Assuming Bank shall give (i) notice to
depositors of the Failed Bank of its assumption of the Deposit liabilities of
the Failed Bank, and (ii) any notice required under Section 2.2, by mailing to
each such depositor a notice with respect to such assumption and by advertising
in a newspaper of general circulation in the county or counties in which the
Failed Bank was located. The Assuming Bank agrees that it will obtain prior
approval of all such notices and advertisements from counsel for the Receiver
and that such notices and advertisements shall not be mailed or published until
such approval is received.

    

    (b)           The
Assuming Bank shall give notice by mail to depositors of the Failed Bank
concerning the procedures to claim their deposits, which notice shall be
provided to the Assuming Bank by the Receiver or the Corporation. Such notice
shall be included with the notice to depositors to be mailed by the Assuming
Bank pursuant to Section 5.3(a).

    

    (c)           If
the Assuming Bank proposes to charge fees different from those charged by the
Failed Bank before it establishes new deposit account relationships with the
depositors of the Failed Bank, the Assuming Bank shall give notice by mail of
such changed fees to such depositors.

    

    ARTICLE
VI

    RECORDS

    

    6.1           Transfer
of Records.

    

    (a)           In
accordance with Section 3.1, the Receiver assigns, transfers, conveys and
delivers to the Assuming Bank the following Records pertaining to the Deposit
liabilities of the Failed Bank assumed by the Assuming Bank under this
Agreement, except as provided in Section 6.4:

    

    
      	
               
      

            	
              (i)

            	
              signature
      cards, orders, contracts between the Failed Bank and its depositors and
      Records of similar character;

            

    

    

    
      (ii)          
 passbooks
of depositors held by the Failed Bank, deposit slips, cancelled checks and
withdrawal orders representing charges to accounts of depositors; and the
following Records pertaining to the Assets:

    

    

    
      	
               
      

            	
              (iii)

            	
              records
      of deposit balances carried with other banks, bankers or trust
      companies;

            

    

    
      
        
          

           

          
            	
                  
	
                     

                  	
                     

                  
	
                     

                  	
                     

                  
	
                     

                  	 
      

          

          	
                  Module
      1 – Whole Bank w/ Loss Share – P&A

                	
                  COOPERATIVE
      BANK

                
	
                  Version
      1.05

                	
                  WILMINGTON,
      NORTH CAROLINA

                
	
                  June
      16, 2009

                	 
      

        

        
        

      

      

    

     

    
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              (iv)

            	
              Loan
      and collateral records and Credit Files and other
    documents;

            

    

    

    
      	
               
      

            	
              (v)

            	
              deeds,
      mortgages, abstracts, surveys, and other instruments or records of title
      pertaining to real estate or real estate
  mortgages;

            

    

    

    
      	
               
      

            	
              (vi)

            	
              signature
      cards, agreements and records pertaining to Safe Deposit Boxes, if any;
      and

            

    

    

    
      	
               
      

            	
              (vii)

            	
              records
      pertaining to the credit card business, trust business or safekeeping
      business of the Failed Bank, if
any.

            

    

    

    (b)           The
Receiver, at its option, may assign and transfer to the Assuming Bank by a
single blanket assignment or otherwise, as soon as practicable after Bank
Closing, any other Records not assigned and transferred to the Assuming Bank as
provided in this Agreement, including but not limited to loan disbursement
checks, general ledger tickets, official bank checks, proof transactions
(including proof tapes) and paid out loan files.

    

    6.2           Delivery
of Assigned Records. The Receiver shall deliver to the Assuming Bank all
Records described in (i) Section 6.1(a) as soon as practicable on or after the
date of this Agreement, and (ii) Section 6.1(b) as soon as practicable after
making any assignment described therein.

    

    6.3           Preservation
of Records. The Assuming Bank agrees that it will preserve and maintain
for the joint benefit of the Receiver, the Corporation and the Assuming Bank,
all Records of which it has custody for such period as either the Receiver or
the Corporation in its discretion may require, until directed otherwise, in writing, by the
Receiver or Corporation. The Assuming Bank shall have the primary responsibility
to respond to subpoenas, discovery requests, and other similar official
inquiries with respect to the Records of which it has custody.

    

    6.4           Access to
Records; Copies. The Assuming Bank agrees to permit the Receiver and the
Corporation access to all Records of which the Assuming Bank has custody, and to
use, inspect, make extracts from or request copies of any such Records in the
manner and to the extent requested, and to duplicate, in the discretion of the
Receiver or the Corporation, any Record in the form of microfilm or microfiche
pertaining to Deposit account relationships; provided, that in the event
that the Failed Bank maintained one or more duplicate copies of such microfilm
or microfiche Records, the Assuming Bank hereby assigns, transfers, and conveys
to the Corporation one such duplicate copy of each such Record without cost to
the Corporation, and agrees to deliver to the Corporation all Records assigned
and transferred to the Corporation under this Article VI as soon as practicable
on or after the date of this Agreement. The party requesting a copy of any
Record shall bear the cost (based on standard accepted industry charges to the
extent applicable, as determined by the Receiver) for providing such duplicate
Records. A copy of each Record requested shall be provided as soon as
practicable by the party having custody thereof.

    

    
      
        
          

           

          
            	
                  
	
                     

                  	
                     

                  
	
                     

                  	
                     

                  
	
                     

                  	 
      

          

          	
                  Module
      1 – Whole Bank w/ Loss Share – P&A

                	
                  COOPERATIVE
      BANK

                
	
                  Version
      1.05

                	
                  WILMINGTON,
      NORTH CAROLINA

                
	
                  June
      16, 2009

                	 
      

        

        
        

      

      

    

     

    
      25

      
        

      

    

    
       

    

    
    

    

    ARTICLE
VII

    FIRST
LOSS TRANCHE

    

    

                The
Assuming Bank has submitted to the Receiver an asset premium (discount) bid of
($123,000,000) and a Deposit premium bid of 0%.  The Deposit premium
bid will be applied to the total of all Assumed Deposits except for brokered,
CDARS, and any market place or similar subscription services
Deposits.  The First Loss Tranche shall be determined by adding (i)
the asset premium (discount) bid, (ii) the Deposit premium bid, and (iii) the
Equity Adjustment.  If the First Loss Tranche is a positive number,
then this is the Losses on Single Family Shared-Loss Loans and Net Charge-offs
on Shared Loss Assets that the Assuming Bank will incur before loss-sharing
commences under Exhibits 4.15A and 4.15B.  If the First Loss Tranche
is a negative number, the Corporation shall pay such amount by wire transfer to
the Assuming Bank by the end of the first business day following Bank Closing
and loss sharing shall commence immediately.

    

    

    

    ARTICLE
VIII

    ADJUSTMENTS

    

    8.1 Pro Forma
Statement. The Receiver, as soon as practicable after Bank Closing, in
accordance with the best information then available, shall provide to the
Assuming Bank a pro forma statement reflecting any adjustments of such
liabilities and assets as may be necessary. Such pro forma statement shall take
into account, to the extent possible, (i) liabilities and assets of a nature
similar to those contemplated by Section 2.1 or Section 3.1, respectively, which
at Bank Closing were carried in the Failed Bank's suspense accounts, (ii)
accruals as of Bank Closing for all income related to the assets and business of
the Failed Bank acquired by the Assuming Bank hereunder, whether or not such
accruals were reflected on the Accounting Records of the Failed Bank in the
normal course of its operations, and (iii) adjustments to determine the Book
Value of any investment in an Acquired Subsidiary and related accounts on the
"bank only" (unconsolidated) balance sheet of the Failed Bank based on the
equity method of accounting, whether or not the Failed Bank used the equity
method of accounting for investments in subsidiaries, except that the resulting
amount cannot be less than the Acquired Subsidiary's recorded equity as of Bank
Closing as reflected on the Accounting Records of the Acquired Subsidiary. Any
Loan purchased by the Assuming Bank pursuant to Section 3.1 which the Failed
Bank charged off during the period following the date of the most recent
pertinent data made available to the Assuming Bank as part of the Information
Package to Bank Closing shall be deemed not to be charged off for the purposes
of the pro forma statement, and the purchase price shall be determined pursuant
to Section 3.2.

    
      
        
          

           

          
            	
                  
	
                     

                  	
                     

                  
	
                     

                  	
                     

                  
	
                     

                  	 
      

          

          	
                  Module
      1 – Whole Bank w/ Loss Share – P&A

                	
                  COOPERATIVE
      BANK

                
	
                  Version
      1.05

                	
                  WILMINGTON,
      NORTH CAROLINA

                
	
                  June
      16, 2009

                	 
      

        

        
        

      

      

    

     

    
      26

      
        

      

    

    
       

    

    
    

    8.2           Correction of Errors and
Omissions; Other Liabilities.

    

               (a)           In
the event any bookkeeping omissions or errors are discovered in preparing any
pro forma statement or in completing the transfers and assumptions contemplated
hereby, the parties hereto agree to correct such errors and omissions, it being
understood that, as far as practicable, all adjustments will be made consistent
with the judgments, methods, policies or accounting principles utilized by the
Failed Bank in preparing and maintaining Accounting Records, except that
adjustments made pursuant to this Section 8.2(a) are not intended to bring the
Accounting Records of the Failed Bank into accordance with generally accepted
accounting principles.

    

    (b)           If
the Receiver discovers at any time subsequent to the date of this Agreement that
any claim exists against the Failed Bank which is of such a nature that it would
have been included in the liabilities assumed under Article II had the existence
of such claim or the facts giving rise thereto been known as of Bank Closing,
the Receiver may, in its discretion, at any time, require that such claim be
assumed by the Assuming Bank in a manner consistent with the intent of this
Agreement. The Receiver will make appropriate adjustments to the pro forma
statement provided by the Receiver to the Assuming Bank pursuant to Section 8.1
as may be necessary.

    

    8.3           Payments.
The Receiver agrees to cause to be paid to the Assuming Bank, or the Assuming
Bank agrees to pay to the Receiver, as the case may be, on the Settlement Date,
a payment in an amount which reflects net adjustments (including any costs,
expenses and fees associated with determinations of value as provided in this
Agreement) made pursuant to Section 8.1 or Section 8.2, plus interest as
provided in Section 8.4. The Receiver and the Assuming Bank agree to effect on
the Settlement Date any further transfer of assets to or assumption of
liabilities or claims by the Assuming Bank as may be necessary in accordance
with Section 8.1 or Section 8.2.

    

    8.4           Interest.
Any amounts paid under Section 8.3 or Section 8.5, shall bear interest for the
period from and including the day following Bank Closing to and including the
day preceding the payment at the Settlement Interest Rate.

    

    8.5           Subsequent
Adjustments. In
the event that the Assuming Bank or the Receiver discovers any errors or
omissions as contemplated by Section 8.2 or any error with respect to the
payment made under Section 8.3 after the Settlement Date, the Assuming Bank and
the Receiver agree to promptly correct any such errors or omissions, make any
payments and effect any transfers or assumptions as may be necessary to reflect
any such correction plus interest as provided in Section 8.4.

    
      
        
          

           

          
            	
                  
	
                     

                  	
                     

                  
	
                     

                  	
                     

                  
	
                     

                  	 
      

          

          	
                  Module
      1 – Whole Bank w/ Loss Share – P&A

                	
                  COOPERATIVE
      BANK

                
	
                  Version
      1.05

                	
                  WILMINGTON,
      NORTH CAROLINA

                
	
                  June
      16, 2009

                	 
      

        

        
        

      

      

    

     

    
      27

      
        

      

    

    
       

    

    
    

    

    ARTICLE
IX

    CONTINUING
COOPERATION

    

    9.1           General
Matters. The parties hereto agree that they will, in good faith and with
their best efforts, cooperate with each other to carry out the transactions
contemplated by this Agreement and to effect the purposes hereof.

    

    9.2           Additional
Title Documents. The Receiver, the Corporation and the Assuming Bank each
agree, at any time, and from time to time, upon the request of any party hereto,
to execute and deliver such additional instruments and documents of conveyance
as shall be reasonably necessary to vest in the appropriate party its full legal
or equitable title in and to the property transferred pursuant to this Agreement
or to be transferred in accordance herewith. The Assuming Bank shall prepare
such instruments and documents of conveyance (in form and substance satisfactory
to the Receiver) as shall be necessary to vest title to the Assets in the
Assuming Bank. The Assuming Bank shall be responsible for recording such
instruments and documents of conveyance at its own expense.

    

    9.3           Claims
and Suits.

    

    (a)           The
Receiver shall have the right, in its discretion, to (i) defend or settle any
claim or suit against the Assuming Bank with respect to which the Receiver has
indemnified the Assuming Bank in the same manner and to the same extent as
provided in Article XII, and (ii) defend or settle any claim or suit against the
Assuming Bank with respect to any Liability Assumed, which claim or suit may
result in a loss to the Receiver arising out of or related to this Agreement, or
which existed against the Failed Bank on or before Bank Closing. The exercise by
the Receiver of any rights under this Section 9.3(a) shall not release the
Assuming Bank with respect to any of its obligations under this
Agreement.

    

    (b)           In
the event any action at law or in equity shall be instituted by any Person
against the Receiver and the Corporation as codefendants with respect to any
asset of the Failed Bank retained or acquired pursuant to this Agreement by the
Receiver, the Receiver agrees, at the request of the Corporation, to join with
the Corporation in a petition to remove the action to the United States District
Court for the proper district. The Receiver agrees to institute, with or without
joinder of the Corporation as coplaintiff, any action with respect to any such
retained or acquired asset or any matter connected therewith whenever notice
requiring such action shall be given by the Corporation to the
Receiver.

    

    9.4           Payment
of Deposits. In the event any depositor does not accept the obligation of
the Assuming Bank to pay any Deposit liability of the Failed Bank assumed by the
Assuming Bank pursuant to this Agreement and asserts a claim against the
Receiver for all or any portion of any such Deposit liability, the Assuming Bank
agrees on demand to provide to the Receiver funds sufficient to pay such claim
in an amount not in excess of the Deposit liability reflected on the books of
the Assuming Bank at the time such claim is made. Upon payment by the Assuming
Bank to the Receiver of such amount, the Assuming Bank shall be discharged from
any further

    
      
        
          

           

          
            	
                  
	
                     

                  	
                     

                  
	
                     

                  	
                     

                  
	
                     

                  	 
      

          

          	
                  Module
      1 – Whole Bank w/ Loss Share – P&A

                	
                  COOPERATIVE
      BANK

                
	
                  Version
      1.05

                	
                  WILMINGTON,
      NORTH CAROLINA

                
	
                  June
      16, 2009

                	 
      

        

        
        

      

      

    

     

    
      28

      
        

      

    

    
       

    

    
    

    obligation
under this Agreement to pay to any such depositor the amount of such Deposit
liability paid to the Receiver.

    

    9.5           Withheld
Payments. At any time, the Receiver or the Corporation may, in its
discretion, determine that all or any portion of any deposit balance assumed by
the Assuming Bank pursuant to this Agreement does not constitute a "Deposit" (or
otherwise, in its discretion, determine that it is the best interest of the
Receiver or Corporation to withhold all or any portion of any deposit), and may
direct the Assuming Bank to withhold payment of all or any portion of any such
deposit balance. Upon such direction, the Assuming Bank agrees to hold such
deposit and not to make any payment of such deposit balance to or on behalf of
the depositor, or to itself, whether by way of transfer, set-off, or otherwise.
The Assuming Bank agrees to maintain the "withheld payment" status of any such
deposit balance until directed in writing by the Receiver or the Corporation as
to its disposition. At the direction of the Receiver or the Corporation, the
Assuming Bank shall return all or any portion of such deposit balance to the
Receiver or the Corporation, as appropriate, and thereupon the Assuming Bank
shall be discharged from any further liability to such depositor with respect to
such returned deposit balance. If such deposit balance has been paid to the
depositor prior to a demand for return by the Corporation or the Receiver, and
payment of such deposit balance had not been previously withheld pursuant to
this Section, the Assuming Bank shall not be obligated to return such deposit
balance to the Receiver or the Corporation. The Assuming Bank shall be obligated
to reimburse the Corporation or the Receiver, as the case may be, for the amount
of any deposit balance or portion thereof paid by the Assuming Bank in
contravention of any previous direction to withhold payment of such deposit
balance or return such deposit balance the payment of which was withheld
pursuant to this Section.

    

    9.6           Proceedings
with Respect to Certain Assets and Liabilities.

    

    (a)           In
connection with any investigation, proceeding or other matter with respect to
any asset or liability of the Failed Bank retained by the Receiver, or any asset
of the Failed Bank acquired by the Receiver pursuant to this Agreement, the
Assuming Bank shall cooperate to the extent reasonably required by the
Receiver.

    

    (b)           In
addition to its obligations under Section 6.4, the Assuming Bank shall provide
representatives of the Receiver access at reasonable times and locations without
other limitation or qualification to (i) its directors, officers, employees and
agents and those of the Subsidiaries acquired by the Assuming Bank, and
(ii) its books and records, the books and records of such Subsidiaries and
all Credit Files, and copies thereof. Copies of books, records and Credit Files
shall be provided by the Assuming Bank as requested by the Receiver and the
costs of duplication thereof shall be borne by the Receiver.

    

    (c)           Not
later than ten (10) days after the Put Notice pursuant to Section 3.4 or the
date of the notice of transfer of any Loan by the Assuming Bank to the Receiver
pursuant to Section 3.6, the Assuming Bank shall deliver to the Receiver such
documents with respect to such Loan as the Receiver may request, including
without limitation the following: (i) all related Credit Documents (other than
certificates, notices and other ancillary documents), (ii) a certificate setting
forth the principal amount on the date of the transfer and the amount of
interest, fees and

    
      
        
          

           

          
            	
                  
	
                     

                  	
                     

                  
	
                     

                  	
                     

                  
	
                     

                  	 
      

          

          	
                  Module
      1 – Whole Bank w/ Loss Share – P&A

                	
                  COOPERATIVE
      BANK

                
	
                  Version
      1.05

                	
                  WILMINGTON,
      NORTH CAROLINA

                
	
                  June
      16, 2009

                	 
      

        

        
        

      

      

    

     

    
      29

      
        

      

    

    
       

    

    
    

    other
charges then accrued and unpaid thereon, and any restrictions on transfer to
which any such Loan is subject, and (iii) all Credit Files, and all documents,
microfiche, microfilm and computer records (including but not limited to
magnetic tape, disc storage, card forms and printed copy) maintained by, owned
by, or in the possession of the Assuming Bank or any Affiliate of the Assuming
Bank relating to the transferred Loan.

    

    9.7           Information.
The Assuming Bank promptly shall provide to the Corporation such other
information, including financial statements and computations, relating to the
performance of the provisions of this Agreement as the Corporation or the
Receiver may request from time to time, and, at the request of the Receiver,
make available employees of the Failed Bank employed or retained by the Assuming
Bank to assist in preparation of the pro forma statement pursuant to Section
8.1.

    

    ARTICLE
X

    CONDITION
PRECEDENT

    

    The obligations of the parties to this
Agreement are subject to the Receiver and the Corporation having received at or
before Bank Closing evidence reasonably satisfactory to each of any necessary
approval, waiver, or other action by any governmental authority, the board of
directors of the Assuming Bank, or other third party, with respect to this
Agreement and the transactions contemplated hereby, the closing of the Failed
Bank and the appointment of the Receiver, the chartering of the Assuming Bank,
and any agreements, documents, matters or proceedings contemplated hereby or
thereby.

    

    ARTICLE
XI

    REPRESENTATIONS
AND WARRANTIES OF THE ASSUMING BANK

    

    The Assuming Bank represents and
warrants to the Corporation and the Receiver as follows:

    

    (a)           Corporate
Existence and Authority. The Assuming Bank (i) is duly organized, validly
existing and in good standing under the laws of its Chartering Authority and has
full power and authority to own and operate its properties and to conduct its
business as now conducted by it, and (ii) has full power and authority to
execute and deliver this Agreement and to perform its obligations hereunder. The
Assuming Bank has taken all necessary corporate action to authorize the
execution, delivery and performance of this Agreement and the performance of the
transactions contemplated hereby.

    

    (b)           Third
Party Consents. No governmental authority or other third party consents
(including but not limited to approvals, licenses, registrations or
declarations) are required in connection with the execution, delivery or
performance by the Assuming Bank of this Agreement, other than such consents as
have been duly obtained and are in full force and effect.

    

    (c)           Execution
and Enforceability. This Agreement has been duly executed and delivered
by the Assuming Bank and when this Agreement has been duly authorized,
executed

    
      
        
          

           

          
            	
                  
	
                     

                  	
                     

                  
	
                     

                  	
                     

                  
	
                     

                  	 
      

          

          	
                  Module
      1 – Whole Bank w/ Loss Share – P&A

                	
                  COOPERATIVE
      BANK

                
	
                  Version
      1.05

                	
                  WILMINGTON,
      NORTH CAROLINA

                
	
                  June
      16, 2009

                	 
      

        

        
        

      

      

    

     

    
      30

      
        

      

    

    
       

    

    
    

    and
delivered by the Corporation and the Receiver, this Agreement will constitute
the legal, valid and binding obligation of the Assuming Bank, enforceable in
accordance with its terms.

    

    (d)           Compliance
with Law.

    

    (i)           Neither
the Assuming Bank nor any of its Subsidiaries is in violation of any statute,
regulation, order, decision, judgment or decree of, or any restriction imposed
by, the United States of America, any State, municipality or other political
subdivision or any agency of any of the foregoing, or any court or other
tribunal having jurisdiction over the Assuming Bank or any of its Subsidiaries
or any assets of any such Person, or any foreign government or agency thereof
having such jurisdiction, with respect to the conduct of the business of the
Assuming Bank or of any of its Subsidiaries, or the ownership of the properties
of the Assuming Bank or any of its Subsidiaries, which, either individually or
in the aggregate with all other such violations, would materially and adversely
affect the business, operations or condition (financial or otherwise) of the
Assuming Bank or the ability of the Assuming Bank to perform, satisfy or observe
any obligation or condition under this Agreement.

    

    (ii)           Neither
the execution and delivery nor the performance by the Assuming Bank of this
Agreement will result in any violation by the Assuming Bank of, or be in
conflict with, any provision of any applicable law or regulation, or any order,
writ or decree of any court or governmental authority.

    

    (e)           Representations
Remain True.  The
Assuming Bank represents and warrants that it has executed and delivered to the
Corporation a Purchaser Eligibility Certification and Confidentiality Agreement
and that all information provided and representations made by or on behalf of
the Assuming Bank in connection with this Agreement and the transactions
contemplated hereby, including, but not limited to, the Purchaser Eligibility
Certification and Confidentiality Agreement (which are affirmed and ratified
hereby) are and remain true and correct in all material respects and do not fail
to state any fact required to make the information contained therein not
misleading.

    

    

    ARTICLE
XII

    INDEMNIFICATION

    

    12.1            Indemnification
of Indemnitees. From and after Bank Closing and subject to the
limitations set forth in this Section and Section 12.6 and compliance by the
Indemnitees with Section 12.2, the Receiver agrees to indemnify and hold
harmless the Indemnitees against any and all costs, losses, liabilities,
expenses (including attorneys' fees) incurred prior to the assumption of defense
by the Receiver pursuant to paragraph (d) of Section 12.2, judgments, fines and
amounts paid in settlement actually and reasonably incurred in connection with
claims against any Indemnitee based on liabilities of the Failed Bank that are
not assumed by the Assuming Bank pursuant to this Agreement or subsequent to the
execution hereof by the Assuming Bank or any Subsidiary or Affiliate of the
Assuming Bank for which indemnification is provided hereunder in (a) of this
Section 12.1, subject to certain exclusions as provided in (b) of this Section
12.1:

    
      
        
          

           

          
            	
                  
	
                     

                  	
                     

                  
	
                     

                  	
                     

                  
	
                     

                  	 
      

          

          	
                  Module
      1 – Whole Bank w/ Loss Share – P&A

                	
                  COOPERATIVE
      BANK

                
	
                  Version
      1.05

                	
                  WILMINGTON,
      NORTH CAROLINA

                
	
                  June
      16, 2009

                	 
      

        

        
        

      

      

    

     

    
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    (a)

    

    (1) claims based on the rights of any
shareholder or former shareholder as such of (x) the Failed Bank, or (y) any
Subsidiary or Affiliate of the Failed Bank;

    

    (2)
claims based on the rights of any creditor as such of the Failed Bank, or any
creditor as such of any director, officer, employee or agent of the Failed Bank,
with respect to any indebtedness or other obligation of the Failed Bank arising
prior to Bank Closing;

    

    (3)
claims based on the rights of any present or former director, officer, employee
or agent as such of the Failed Bank or of any Subsidiary or Affiliate of the
Failed Bank;

    

    (4)
claims based on any action or inaction prior to Bank Closing of the Failed Bank,
its directors, officers, employees or agents as such, or any Subsidiary or
Affiliate of the Failed Bank, or the directors, officers, employees or agents as
such of such Subsidiary or Affiliate;

    

    (5)
claims based on any malfeasance, misfeasance or nonfeasance of the Failed Bank,
its directors, officers, employees or agents with respect to the trust business
of the Failed Bank, if any;

    

    (6)
claims based on any failure or alleged failure (not in violation of law) by the
Assuming Bank to continue to perform any service or activity previously
performed by the Failed Bank which the Assuming Bank is not required to perform
pursuant to this Agreement or which arise under any contract to which the Failed
Bank was a party which the Assuming Bank elected not to assume in accordance
with this Agreement and which neither the Assuming Bank nor any Subsidiary or
Affiliate of the Assuming Bank has assumed subsequent to the execution
hereof;

    

    (7) claims arising from any action or
inaction of any Indemnitee, including for purposes of this Section 12.1(a)(7)
the former officers or employees of the Failed Bank or of any Subsidiary or
Affiliate of the Failed Bank that is taken upon the specific written direction
of the Corporation or the Receiver, other than any action or
inaction taken in a manner constituting bad faith, gross negligence or willful
misconduct; and

    

    (8)
claims based on the rights of any depositor of the Failed Bank whose deposit has
been accorded "withheld payment" status and/or returned to the Receiver or
Corporation in accordance with Section 9.5 and/or has become an "unclaimed
deposit" or has been returned to the Corporation or the Receiver in accordance
with Section 2.3;

    

    (b)           provided, that, with respect to
this Agreement, except for paragraphs (7) and (8) of Section 12.1(a), no
indemnification will be provided under this Agreement for any:

    

    (1)
judgment or fine against, or any amount paid in settlement (without the written
approval of the Receiver) by, any Indemnitee in connection with any action that
seeks damages

    
      
        
          

           

          
            	
                  
	
                     

                  	
                     

                  
	
                     

                  	
                     

                  
	
                     

                  	 
      

          

          	
                  Module
      1 – Whole Bank w/ Loss Share – P&A

                	
                  COOPERATIVE
      BANK

                
	
                  Version
      1.05

                	
                  WILMINGTON,
      NORTH CAROLINA

                
	
                  June
      16, 2009

                	 
      

        

        
        

      

      

    

     

    
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    against
any Indemnitee (a "counterclaim") arising with respect to any Asset and based on
any action or inaction of either the Failed Bank, its directors, officers,
employees or agents as such prior to Bank Closing, unless any such judgment,
fine or amount paid in settlement exceeds the greater of (i) the Repurchase
Price of such Asset, or (ii) the monetary recovery sought on such Asset by the
Assuming Bank in the cause of action from which the counterclaim arises; and in
such event the Receiver will provide indemnification only in the amount of such
excess; and no indemnification will be provided for any costs or expenses other
than any costs or expenses (including attorneys' fees) which, in the
determination of the Receiver, have been actually and reasonably incurred by
such Indemnitee in connection with the defense of any such counterclaim; and it
is expressly agreed that the Receiver reserves the right to intervene, in its
discretion, on its behalf and/or on behalf of the Receiver, in the defense of
any such counterclaim;

    

    (2)
claims with respect to any liability or obligation of the Failed Bank that is
expressly assumed by the Assuming Bank pursuant to this Agreement or subsequent
to the execution hereof by the Assuming Bank or any Subsidiary or Affiliate of
the Assuming Bank;

    

    (3)
claims with respect to any liability of the Failed Bank to any present or former
employee as such of the Failed Bank or of any Subsidiary or Affiliate of the
Failed Bank, which liability is expressly assumed by the Assuming Bank pursuant
to this Agreement or subsequent to the execution hereof by the Assuming Bank or
any Subsidiary or Affiliate of the Assuming Bank;

    

    (4)
claims based on the failure of any Indemnitee to seek recovery of damages from
the Receiver for any claims based upon any action or inaction of the Failed
Bank, its directors, officers, employees or agents as fiduciary, agent or
custodian prior to Bank Closing;

    

    (5)
claims based on any violation or alleged violation by any Indemnitee of the
antitrust, branching, banking or bank holding company or securities laws of the
United States of America or any State thereof;

    

    (6)
claims based on the rights of any present or former creditor, customer, or
supplier as such of the Assuming Bank or any Subsidiary or Affiliate of the
Assuming Bank;

    

    (7)
claims based on the rights of any present or former shareholder as such of the
Assuming Bank or any Subsidiary or Affiliate of the Assuming Bank regardless of
whether any such present or former shareholder is also a present or former
shareholder of the Failed Bank;

    

    (8)
claims, if the Receiver determines that the effect of providing such
indemnification would be to (i) expand or alter the provisions of any warranty
or disclaimer thereof provided in Section 3.3 or any other provision of this
Agreement, or (ii) create any warranty not expressly provided under this
Agreement;

    

    (9)
claims which could have been enforced against any Indemnitee had the Assuming
Bank not entered into this Agreement;

    
      
        
          

           

          
            	
                  
	
                     

                  	
                     

                  
	
                     

                  	
                     

                  
	
                     

                  	 
      

          

          	
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                  COOPERATIVE
      BANK

                
	
                  Version
      1.05

                	
                  WILMINGTON,
      NORTH CAROLINA

                
	
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    (10)
claims based on any liability for taxes or fees assessed with respect to the
consummation of the transactions contemplated by this Agreement, including
without limitation any subsequent transfer of any Assets or Liabilities Assumed
to any Subsidiary or Affiliate of the Assuming Bank;

    

    (11)
except as expressly provided in this Article XII, claims based on any action or
inaction of any Indemnitee, and nothing in this Agreement shall be construed to
provide indemnification for (i) the Failed Bank, (ii) any Subsidiary or
Affiliate of the Failed Bank, or (iii) any present or former director, officer,
employee or agent of the Failed Bank or its Subsidiaries or Affiliates; provided, that the Receiver, in
its discretion, may provide indemnification hereunder for any present or former
director, officer, employee or agent of the Failed Bank or its Subsidiaries or
Affiliates who is also or becomes a director, officer, employee or agent of the
Assuming Bank or its Subsidiaries or Affiliates;

    

    (12)
claims or actions which constitute a breach by the Assuming Bank of the
representations and warranties contained in Article XI;

    

    (13)
claims arising out of or relating to the condition of or generated by an Asset
arising from or relating to the presence, storage or release of any hazardous or
toxic substance, or any pollutant or contaminant, or condition of such Asset
which violate any applicable Federal, State or local law or regulation
concerning environmental protection; and

    

    (14)
claims based on, related to or arising from any asset, including a loan,
acquired or liability assumed by the Assuming Bank, other than pursuant to this
Agreement.

    

               12.2           Conditions
Precedent to Indemnification. It shall be a condition precedent to the
obligation of the Receiver to indemnify any Person pursuant to this Article XII
that such Person shall, with respect to any claim made or threatened against
such Person for which such Person is or may be entitled to indemnification
hereunder:

    

    (a)           
give written notice to the Regional Counsel (Litigation Branch) of the
Corporation in the manner and at the address provided in Section 13.7 of such
claim as soon as practicable after such claim is made or threatened; provided, that notice must be
given on or before the date which is six (6) years from the date of this
Agreement;

    

    (b)           provide
to the Receiver such information and cooperation with respect to such claim as
the Receiver may reasonably require;

    

    (c)           cooperate
and take all steps, as the Receiver may reasonably require, to preserve and
protect any defense to such claim;

    

    (d)           in
the event suit is brought with respect to such claim, upon reasonable prior
notice, afford to the Receiver the right, which the Receiver may exercise in its
sole discretion, to conduct the investigation, control the defense and effect
settlement of such claim, including without limitation the right to designate
counsel and to control all negotiations, litigation, arbitration, settlements,
compromises and appeals of any such claim, all of which shall be at
the

    
      
        
          

           

          
            	
                  
	
                     

                  	
                     

                  
	
                     

                  	
                     

                  
	
                     

                  	 
      

          

          	
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      1 – Whole Bank w/ Loss Share – P&A

                	
                  COOPERATIVE
      BANK

                
	
                  Version
      1.05

                	
                  WILMINGTON,
      NORTH CAROLINA

                
	
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    expense
of the Receiver; provided, that the Receiver
shall have notified the Person claiming indemnification in writing that such
claim is a claim with respect to which the Person claiming indemnification is
entitled to indemnification under this Article XII;

    

    (e)           not
incur any costs or expenses in connection with any response or suit with respect
to such claim, unless such costs or expenses were incurred upon the written
direction of the Receiver; provided, that the Receiver
shall not be obligated to reimburse the amount of any such costs or expenses
unless such costs or expenses were incurred upon the written direction of the
Receiver;

    

    (f)           not
release or settle such claim or make any payment or admission with respect
thereto, unless the Receiver consents in writing thereto, which consent shall
not be unreasonably withheld; provided, that the Receiver
shall not be obligated to reimburse the amount of any such settlement or payment
unless such settlement or payment was effected upon the written direction of the
Receiver; and

    

    (g)           take
reasonable action as the Receiver may request in writing as necessary to
preserve, protect or enforce the rights of the indemnified Person against any
Primary Indemnitor.

    

    12.3           No
Additional Warranty. Nothing in this Article XII shall be construed or
deemed to (i) expand or otherwise alter any warranty or disclaimer thereof
provided under Section 3.3 or any other provision of this Agreement with respect
to, among other matters, the title, value, collectibility, genuineness,
enforceability or condition of any (x) Asset, or (y) asset of the Failed Bank
purchased by the Assuming Bank subsequent to the execution of this Agreement by
the Assuming Bank or any Subsidiary or Affiliate of the Assuming Bank, or (ii)
create any warranty not expressly provided under this Agreement with respect
thereto.

    

    12.4           Indemnification
of Receiver and Corporation. From and after Bank Closing, the
Assuming Bank agrees to indemnify and hold harmless the Corporation and the
Receiver and their respective directors, officers, employees and agents from and
against any and all costs, losses, liabilities, expenses (including attorneys'
fees), judgments, fines and amounts paid in settlement actually and reasonably
incurred in connection with any of the following:

    

    (a)           claims
based on any and all liabilities or obligations of the Failed Bank assumed by
the Assuming Bank pursuant to this Agreement or subsequent to the execution
hereof by the Assuming Bank or any Subsidiary or Affiliate of the Assuming Bank,
whether or not any such liabilities subsequently are sold and/or transferred,
other than any claim based upon any action or inaction of any Indemnitee as
provided in paragraph (7) or (8) of Section 12.1(a); and

    

    (b)           claims
based on any act or omission of any Indemnitee (including but not limited to
claims of any Person claiming any right or title by or through the Assuming Bank
with respect to Assets transferred to the Receiver pursuant to Section 3.4 or
3.6), other than any action or inaction of any Indemnitee as provided in
paragraph (7) or (8) of Section 12.1(a).

    

    12.5           Obligations
Supplemental. The obligations of the Receiver, and the Corporation as
guarantor in accordance with Section 12.7, to provide indemnification under this
Article XII

    
      
        
          

           

          
            	
                  
	
                     

                  	
                     

                  
	
                     

                  	
                     

                  
	
                     

                  	 
      

          

          	
                  Module
      1 – Whole Bank w/ Loss Share – P&A

                	
                  COOPERATIVE
      BANK

                
	
                  Version
      1.05

                	
                  WILMINGTON,
      NORTH CAROLINA

                
	
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    are to
supplement any amount payable by any Primary Indemnitor to the Person
indemnified under this Article XII. Consistent with that intent, the Receiver
agrees only to make payments pursuant to such indemnification to the extent not
payable by a Primary Indemnitor. If the aggregate amount of payments by the
Receiver, or the Corporation as guarantor in accordance with Section 12.7, and
all Primary Indemnitors with respect to any item of indemnification under this
Article XII exceeds the amount payable with respect to such item, such Person
being indemnified shall notify the Receiver thereof and, upon the request of the
Receiver, shall promptly pay to the Receiver, or the Corporation as appropriate,
the amount of the Receiver's (or Corporation's) payments to the extent of such
excess.

    

    12.6           Criminal
Claims. Notwithstanding any provision of this Article XII to the
contrary, in the event that any Person being indemnified under this Article XII
shall become involved in any criminal action, suit or proceeding, whether
judicial, administrative or investigative, the Receiver shall have no obligation
hereunder to indemnify such Person for liability with respect to any criminal
act or to the extent any costs or expenses are attributable to the defense
against the allegation of any criminal act, unless (i) the Person is successful
on the merits or otherwise in the defense against any such action, suit or
proceeding, or (ii) such action, suit or proceeding is terminated without the
imposition of liability on such Person.

    

    12.7           Limited
Guaranty of the Corporation.  The Corporation
hereby guarantees performance of the Receiver's obligation to indemnify the
Assuming Bank as set forth in this Article XII. It is a condition to the
Corporation's obligation hereunder that the Assuming Bank shall comply in all
respects with the applicable provisions of this Article XII. The Corporation
shall be liable hereunder only for such amounts, if any, as the Receiver is
obligated to pay under the terms of this Article XII but shall fail to pay.
Except as otherwise provided above in this Section 12.7, nothing in this Article
XII is intended or shall be construed to create any liability or obligation on
the part of the Corporation, the United States of America or any department or
agency thereof under or with respect to this Article XII, or any provision
hereof, it being the intention of the parties hereto that the obligations
undertaken by the Receiver under this Article XII are the sole and exclusive
responsibility of the Receiver and no other Person or entity.

    

    12.8           Subrogation. Upon payment by the
Receiver, or the Corporation as guarantor in accordance with Section 12.7, to
any Indemnitee for any claims indemnified by the Receiver under this Article
XII, the Receiver, or the Corporation as appropriate, shall become subrogated to
all rights of the Indemnitee against any other Person to the extent of such
payment.

    

    

    ARTICLE
XIII

    MISCELLANEOUS

    

    13.1           Entire
Agreement. This Agreement embodies the entire agreement of the parties
hereto in relation to the subject matter herein and supersedes all prior
understandings or agreements, oral or written, between the parties.

    

    13.2           Headings.
The headings and subheadings of the Table of Contents, Articles and Sections
contained in this Agreement, except the terms identified for definition in
Article I and

    
      
        
          

           

          
            	
                  
	
                     

                  	
                     

                  
	
                     

                  	
                     

                  
	
                     

                  	 
      

          

          	
                  Module
      1 – Whole Bank w/ Loss Share – P&A

                	
                  COOPERATIVE
      BANK

                
	
                  Version
      1.05

                	
                  WILMINGTON,
      NORTH CAROLINA

                
	
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    elsewhere
in this Agreement, are inserted for convenience only and shall not affect the
meaning or interpretation of this Agreement or any provision
hereof.

    

    13.3           Counterparts.
This Agreement may be executed in any number of counterparts and by the duly
authorized representative of a different party hereto on separate counterparts,
each of which when so executed shall be deemed to be an original and all of
which when taken together shall constitute one and the same
Agreement.

    

    13.4           GOVERNING
LAW. THIS AGREEMENT AND THE RIGHTS AND OBLIGATIONS HEREUNDER SHALL BE
GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE FEDERAL LAW OF THE UNITED
STATES OF AMERICA, AND IN THE ABSENCE OF CONTROLLING FEDERAL LAW, IN ACCORDANCE
WITH THE LAWS OF THE STATE IN WHICH THE MAIN OFFICE OF THE FAILED BANK IS
LOCATED.

    

    13.5           Successors.
All terms and conditions of this Agreement shall be binding on the successors
and assigns of the Receiver, the Corporation and the Assuming Bank. Except as
otherwise specifically provided in this Agreement, nothing expressed or referred
to in this Agreement is intended or shall be construed to give any Person other
than the Receiver, the Corporation and the Assuming Bank any legal or equitable
right, remedy or claim under or with respect to this Agreement or any provisions
contained herein, it being the intention of the parties hereto that this
Agreement, the obligations and statements of responsibilities hereunder, and all
other conditions and provisions hereof are for the sole and exclusive benefit of
the Receiver, the Corporation and the Assuming Bank and for the benefit of no
other Person.

    

    13.6           Modification;
Assignment. No amendment or other modification, rescission, release, or
assignment of any part of this Agreement shall be effective except pursuant to a
written agreement subscribed by the duly authorized representatives of the
parties hereto.

    

    13.7           Notice.
Any notice, request, demand, consent, approval or other communication to any
party hereto shall be effective when received and shall be given in writing, and
delivered in person against receipt therefore, or sent by certified mail,
postage prepaid, courier service, telex, facsimile transmission or email to such
party (with copies as indicated below) at its address set forth below or at such
other address as it shall hereafter furnish in writing to the other parties. All
such notices and other communications shall be deemed given on the date received
by the addressee.

    

    Assuming
Bank

    

    First
Bank

    341 North
Main Street

    PO Box
508

    Troy, NC
27371

    

    

    
      
        
          

           

          
            	
                  
	
                     

                  	
                     

                  
	
                     

                  	
                     

                  
	
                     

                  	 
      

          

          	
                  Module
      1 – Whole Bank w/ Loss Share – P&A

                	
                  COOPERATIVE
      BANK

                
	
                  Version
      1.05

                	
                  WILMINGTON,
      NORTH CAROLINA

                
	
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      16, 2009

                	 
      

        

        
        

      

      

    

     

    
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    Receiver and
Corporation

    

    Federal
Deposit Insurance Corporation,

    Receiver
of COOPERATIVE
BANK

    1601
Bryan Street, Suite 1700

    Dallas,
Texas 75201

    

    Attention:
Settlement Manager

    

    with copy
to: Regional Counsel (Litigation Branch)

    

    and
with respect to notice under Article XII:

    

    Federal
Deposit Insurance Corporation

    Receiver
of COOPERATIVE
BANK

    1601
Bryan Street, Suite 1700

    Dallas,
Texas 75201

    Attention:
Regional Counsel (Litigation Branch)

    

    13.8           Manner of
Payment. All payments due under this Agreement shall be in lawful money
of the United States of America in immediately available funds as each party
hereto may specify to the other parties; provided, that in the event the
Receiver or the Corporation is obligated to make any payment hereunder in the
amount of $25,000.00 or less, such payment may be made by check.

    

    13.9           Costs,
Fees and Expenses. Except as otherwise specifically provided herein, each
party hereto agrees to pay all costs, fees and expenses which it has incurred in
connection with or incidental to the matters contained in this Agreement,
including without limitation any fees and disbursements to its accountants and
counsel; provided, that the Assuming
Bank shall pay all fees, costs and expenses (other than attorneys' fees incurred
by the Receiver) incurred in connection with the transfer to it of any Assets or
Liabilities Assumed hereunder or in accordance herewith.

    

    13.10         Waiver.
Each of the Receiver, the Corporation and the Assuming Bank may waive its
respective rights, powers or privileges under this Agreement; provided, that such waiver
shall be in writing; and further provided, that no failure or
delay on the part of the Receiver, the Corporation or the Assuming Bank to
exercise any right, power or privilege under this Agreement shall operate as a
waiver thereof, nor will any single or partial exercise of any right, power or
privilege under this Agreement preclude any other or further exercise thereof or
the exercise of any other right, power or privilege by the Receiver, the
Corporation, or the Assuming Bank under this Agreement, nor will any such waiver
operate or be construed as a future waiver of such right, power or privilege
under this Agreement.

    
      
        
          

           

          
            	
                  
	
                     

                  	
                     

                  
	
                     

                  	
                     

                  
	
                     

                  	 
      

          

          	
                  Module
      1 – Whole Bank w/ Loss Share – P&A

                	
                  COOPERATIVE
      BANK

                
	
                  Version
      1.05

                	
                  WILMINGTON,
      NORTH CAROLINA

                
	
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    13.11           Severability.
If any provision of this Agreement is declared invalid or unenforceable, then,
to the extent possible, all of the remaining provisions of this Agreement shall
remain in full force and effect and shall be binding upon the parties
hereto.

    

    13.12           Term of
Agreement. This Agreement shall continue in full force and effect until
the sixth (6th) anniversary of Bank Closing; provided, that the provisions
of Section 6.3 and 6.4 shall survive the expiration of the term of this
Agreement. Provided, however, the receivership of the Failed Bank may be
terminated prior to the expiration of the term of this Agreement; in such event,
the guaranty of the Corporation, as provided in and in accordance with the
provisions of Section 12.7 shall be in effect for the remainder of the term.
Expiration of the term of this Agreement shall not affect any claim or liability
of any party with respect to any (i) amount which is owing at the time of such
expiration, regardless of when such amount becomes payable, and (ii) breach of
this Agreement occurring prior to such expiration, regardless of when such
breach is discovered.

    

    13.13           Survival
of Covenants, Etc. The covenants,
representations, and warranties in this Agreement shall survive the execution of
this Agreement and the consummation of the transactions contemplated
hereunder.

    

    [Signature
Page Follows]

    
      
        
          

           

          
            	
                  
	
                     

                  	
                     

                  
	
                     

                  	
                     

                  
	
                     

                  	 
      

          

          	
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      1 – Whole Bank w/ Loss Share – P&A

                	
                  COOPERATIVE
      BANK

                
	
                  Version
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      NORTH CAROLINA

                
	
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    IN WITNESS WHEREOF, the
parties hereto have caused this Agreement to be executed by their duly
authorized representatives as of the date first above written.

    

    

    
      	 
      	
              FEDERAL
      DEPOSIT INSURANCE CORPORATION,

            
	 
      	
              RECEIVER
      OF COOPERATIVE BANK

            
	 
      	
              WILMINGTON,
      NORTH CAROLINA

            
	 
      	 
      	 
      
	 
      	 
      	 
      
	 
      	
              BY:

            	
              /s/ Michael W.
      Lamb

            
	 
      	 
      	
              MICHAEL
      W. LAMB

            
	 
      	 
      	
              RECEIVER-IN-CHARGE

            
	
              Attest:

            	 
      	 
      
	 
      	 
      	 
      
	
              /s/ Craig C.
      Ostrander

            	 
      	 
      
	
              Craig
      C. Ostrander, FDIC-DRR

            	 
      	 
      
	 
      	
              FEDERAL
      DEPOSIT INSURANCE CORPORATION

            
	 
      	 
      	 
      
	 
      	 
      	 
      
	 
      	
              BY:

            	
              /s/ Michael W.
      Lamb

            
	 
      	 
      	
              MICHAEL
      W. LAMB

            
	 
      	 
      	
              ATTORNEY-IN-FACT

            
	
              Attest:

            	 
      	 
      
	 
      	 
      	 
      
	 
      	 
      	 
      
	
              /s/ Craig C.
      Ostrander

            	 
      	 
      
	
              Craig
      C. Ostrander, FDIC-DRR

            	 
      	 
      
	 
      	 
      	 
      
	 
      	
              FIRST
      BANK

            
	 
      	 
      	 
      
	 
      	 
      	 
      
	 
      	
              BY:

            	
              /s/ Jerry L.
      Ocheltree

            
	 
      	 
      	
              JERRY
      L. OCHELTREE

            
	 
      	 
      	
              PRESIDENT

            
	 
      	 
      	 
      
	
              Attest:

            	 
      	 
      
	 
      	 
      	 
      
	 
      	 
      	 
      
	
              /s/ Teresa C.
      Nixon

            	 
      	 
      
	
              EVP

            	 
      	 
      

    

    
      
        
          

           

          
            	
                  
	
                     

                  	
                     

                  
	
                     

                  	
                     

                  
	
                     

                  	 
      

          

          	
                  Module
      1 – Whole Bank w/ Loss Share – P&A

                	
                  COOPERATIVE
      BANK

                
	
                  Version
      1.05

                	
                  WILMINGTON,
      NORTH CAROLINA

                
	
                  June
      16, 2009

                	 
      

        

        
        

      

      

    

     

    
      40

      
        

      

    

    
       

    

    
    

    SCHEDULE
2.1 - Certain Liabilities Assumed by the Assuming Bank

    

    

    

    Schedule
Omitted.

    

    

    
      
        
          

           

          
            	
                  
	
                     

                  	
                     

                  
	
                     

                  	
                     

                  
	
                     

                  	 
      

          

          	
                  Module
      1 – Whole Bank w/ Loss Share – P&A

                	
                  COOPERATIVE
      BANK

                
	
                  Version
      1.05

                	
                  WILMINGTON,
      NORTH CAROLINA

                
	
                  June
      16, 2009

                	 
      

        

        
        

      

      

    

     

    
      41

      
        

      

    

    
       

    

    
    

    SCHEDULE
2.1(a) – Excluded Deposit Liability Accounts

    

    

    

    Schedule
Omitted.

    

    
      
        
          

           

          
            	
                  
	
                     

                  	
                     

                  
	
                     

                  	
                     

                  
	
                     

                  	 
      

          

          	
                  Module
      1 – Whole Bank w/ Loss Share – P&A

                	
                  COOPERATIVE
      BANK

                
	
                  Version
      1.05

                	
                  WILMINGTON,
      NORTH CAROLINA

                
	
                  June
      16, 2009

                	 
      

        

        
        

      

      

    

     

    
      42

      
        

      

    

    
       

    

    
    

    SCHEDULE 3.1 - Certain Assets
Purchased

    

    SEE
ATTACHED LIST

    

    THE  LIST(S)
ATTACHED TO THIS SCHEDULE (OR SUBSCHEDULE(S)) AND THE INFORMATION THEREIN, IS AS
OF THE DATE OF THE MOST RECENT PERTINENT DATA MADE AVAILABLE TO THE ASSUMING
BANK AS PART OF THE INFORMATION PACKAGE.  IT WILL BE ADJUSTED TO
REFLECT THE COMPOSITION AND BOOK VALUE OF THE LOANS AND ASSETS AS OF THE DATE OF
BANK CLOSING. THE LIST(S) MAY NOT INCLUDE ALL LOANS AND ASSETS (E.G., CHARGED
OFF LOANS). THE LIST(S) MAY BE REPLACED WITH A MORE ACCURATE LIST POST
CLOSING.

    

    
      
        
          

           

          
            	
                  
	
                     

                  	
                     

                  
	
                     

                  	
                     

                  
	
                     

                  	 
      

          

          	
                  Module
      1 – Whole Bank w/ Loss Share – P&A

                	
                  COOPERATIVE
      BANK

                
	
                  Version
      1.05

                	
                  WILMINGTON,
      NORTH CAROLINA

                
	
                  June
      16, 2009

                	 
      

        

        
        

      

      

    

     

    
      43

      
        

      

    

    
       

    

    
    

    SCHEDULE
3.2 - Purchase Price of Assets or assets

    

    

    
      	
              (a)    cash
      and receivables from depository institutions, including cash items in the
      process of collection, plus interest thereon:

            	
              Book
      Value

            

    

    

    
      	
              (b)   securities
      (including, but not limited to FHLB stock, but exclusive of the capital
      stock of Acquired Subsidiaries), plus interest thereon:

            	
              As
      provided in Section 3.2(b)

            

    

    

    
      	
              (c)    federal
      funds sold and repurchase agreements, if any, including interest
      thereon:

            	
              Book
      Value

            

    

    

    
      	
              (d)    Loans:

            	
              Book
      Value

            

    

    

    

    
      	
              (e)   credit card
      business, if any, including all outstanding extensions of credit and
      offensive litigation, but excluding any class action lawsuits related to
      the credit card business:

            	
              Book
      Value

            
	 
      	 
      
	
              (f)    Safe
      Deposit Boxes and related business, safekeeping business and trust
      business, if any:

            	
              Book
      Value

            

    

    

    
      	
              (g)   Records and
      other documents:

            	
              Book
      Value

            

    

    

    
      	
              (h)   capital stock
      of any Acquired Subsidiaries:

            	
              Book
      Value

            

    

    

    
      
        	
                (i)    amounts
      owed to the Failed Bank by any Acquired Subsidiary:

              	
                Book
      Value

              
	 	 
	
                (j)    assets
      securing Deposits of public money, to the extent not otherwise purchased
      hereunder:

              	
                Book
      Value

              
	 
      	 
      
	
                (k)    Overdrafts of
      customers:

              	
                Book
      Value

              

      

    

    

    

    
      	
              (l)    rights,
      if any, with respect to Qualified Financial Contracts.

            	
              As
      provided in Section 3.2(c)

               

               

            

    

    

    
      
        
          

           

          
            	
                  
	
                     

                  	
                     

                  
	
                     

                  	
                     

                  
	
                     

                  	 
      

          

          	
                  Module
      1 – Whole Bank w/ Loss Share – P&A

                	
                  COOPERATIVE
      BANK

                
	
                  Version
      1.05

                	
                  WILMINGTON,
      NORTH CAROLINA

                
	
                  June
      16, 2009

                	 
      

        

        
        

      

      

    

     

    
      44

      
        

      

    

    
       

    

    
    

    

    
      
        	
                (m)   Rights of the
      Failed Bank to provide mortgage servicing for others and to have mortgage
      servicing provided to the Failed Bank by others and related
      contracts:

              	
                Book
      Value

              
	 	 
	
                (n)   Interests in
      automobiles and airplanes:

              	
                Book
      Value

              

      

    

    

    assets
subject to an option to purchase:

    

    

    
      	
              (a)    Bank
      Premises:

            	
              Fair
      Market Value

            

    

    

    
      	
              (b)           Furniture
      and Equipment:

            	
              Fair
      Market Value

               

            
	
              (c)           Fixtures:

            	
              Fair
      Market Value

            

    

    

    
      	
              (d)           Other
      Equipment:

            	
              Fair
      Market Value

            

    

    

    

    

    

    
      
        
          

           

          
            	
                  
	
                     

                  	
                     

                  
	
                     

                  	
                     

                  
	
                     

                  	 
      

          

          	
                  Module
      1 – Whole Bank w/ Loss Share – P&A

                	
                  COOPERATIVE
      BANK

                
	
                  Version
      1.05

                	
                  WILMINGTON,
      NORTH CAROLINA

                
	
                  June
      16, 2009

                	 
      

        

        
        

      

      

    

     

    
      45

      
        

      

    

    
       

    

    
    

    SCHEDULE
3.5(l) – Excluded Private Label Asset-Backed Securities

    

    

    Schedule
Omitted.

    
      
        
          

           

          
            	
                  
	
                     

                  	
                     

                  
	
                     

                  	
                     

                  
	
                     

                  	 
      

          

          	
                  Module
      1 – Whole Bank w/ Loss Share – P&A

                	
                  COOPERATIVE
      BANK

                
	
                  Version
      1.05

                	
                  WILMINGTON,
      NORTH CAROLINA

                
	
                  June
      16, 2009

                	 
      

        

        
        

      

      

    

     

    
      46

      
        

      

    

    
       

    

    
    

    SCHEDULE
4.15A

    

    LOANS
SUBJECT TO LOSS SHARING UNDER THE

    SINGLE
FAMILY SHARED-LOSS AGREEMENT

    

    

    Schedule
Omitted.

    
      
        
          

           

          
            	
                  
	
                     

                  	
                     

                  
	
                     

                  	
                     

                  
	
                     

                  	 
      

          

          	
                  Module
      1 – Whole Bank w/ Loss Share – P&A

                	
                  COOPERATIVE
      BANK

                
	
                  Version
      1.05

                	
                  WILMINGTON,
      NORTH CAROLINA

                
	
                  June
      16, 2009

                	 
      

        

        
        

      

      

    

     

    
      47

      
        

      

    

    
       

    

    
    

    SCHEDULE
4.15B

    

    LOANS
SUBJECT TO LOSS SHARING UNDER THE

    NON-SINGLE
FAMILY SHARED-LOSS AGREEMENT

    

    

    Schedule
Omitted.

    
      
        
          

           

          
            	
                  
	
                     

                  	
                     

                  
	
                     

                  	
                     

                  
	
                     

                  	 
      

          

          	
                  Module
      1 – Whole Bank w/ Loss Share – P&A

                	
                  COOPERATIVE
      BANK

                
	
                  Version
      1.05

                	
                  WILMINGTON,
      NORTH CAROLINA

                
	
                  June
      16, 2009

                	 
      

        

        
        

      

      

    

     

    
      48

      
        

      

    

    
       

    

    
    

    SCHEDULE
7 -Accounts Excluded from Calculation of Deposit Franchise Bid Premium

    

    

    

    The
accounts identified below will pass to the Assuming Bank (unless otherwise
noted).   When calculating the premium to be paid on Assumed
Deposits in a P&A transaction, the FDIC will exclude the following
categories of deposit accounts:

    

    
      
        
          
            	
                    Category

                  	
                    Description

                  	 
      	
                    Amount

                  
	
                    I

                  	
                    Non-
      DO Brokered Deposits

                  	 
      	
                    $_,___,___.__

                  
	
                    II

                  	
                    CDARS

                  	 
      	
                    $_,___,___.__

                  
	
                    III

                  	
                    Market
      Place Deposits

                  	 
      	
                    $__,___,___.__

                  
	 
      	
                    Total
      deposits excluded from Calculation of premium

                  	
                    $__,___,___.__

                  
	 
      	 
      	 
      

          

        

      

    

    

    Category
Description

    

     I  Brokered
Deposits

    Brokered
deposit accounts are accounts for which the “depositor of record” is an agent,
nominee, or custodian who deposits funds for a principal or principals to whom
“pass-through” deposit insurance coverage may be extended.  The FDIC
separates brokered deposit accounts into 2 categories:  1) Depository
Organization (DO) Brokered Deposits and 2) Non-Depository Organization (Non-DO)
Brokered Deposits.  This distinction is made by the FDIC to facilitate
our role as Receiver and Insurer.  These terms will not appear on
other “brokered deposit” reports generated by the institution.

    

    Non-DO
Brokered Deposits pass to the Assuming Bank, but are excluded from Assumed
Deposits when the deposit premium is calculated.  Please see the
attached “Schedule 7 Non-DO Broker Deposit Detail Report” for a listing of these
accounts.  This list will be updated post closing with balances as of
Bank Closing date.

    

    If this
institution had any DO Brokered Deposits (Cede & Co as Nominee for DTC),
they are excluded from Assumed Deposits in the P&A transaction.  A
list of these accounts is provided on “Schedule 2.1 DO Brokered Deposit Detail
Report”.

    

    II
CDARS

    CDARS
deposits pass to the Assuming Bank, but are excluded from Assumed Deposits when
the deposit premium is calculated.

    

    __________
did not participate in the CDARS program as of the date of the deposit
download.  If CDARS deposits are taken between the date of the deposit
download and the Bank Closing Date, they will be identified post closing and
made part of Schedule 7 to the P&A Agreement.

    

    III  Market
Place Deposits

    “Market
Place Deposits” is a description given to deposits that may have been solicited
via a money desk, internet subscription service (for example, Qwickrate), or
similar programs.

    

    __________
does have Qwickrate deposits as identified above.  The Qwickrate
deposits are reported as time deposits in the Call Report.  _________
uses “Branch 4” on their system to identify both brokered and Qwickrate
deposits.  Please see the attached Schedule 7 – Qwickrate Deposit
Detail Report for a listing of

    
      
        
          

           

          
            	
                  
	
                     

                  	
                     

                  
	
                     

                  	
                     

                  
	
                     

                  	 
      

          

          	
                  Module
      1 – Whole Bank w/ Loss Share – P&A

                	
                  COOPERATIVE
      BANK

                
	
                  Version
      1.05

                	
                  WILMINGTON,
      NORTH CAROLINA

                
	
                  June
      16, 2009

                	 
      

        

        
        

      

      

    

     

    
      49

      
        

      

    

    
       

    

    
    

    these
accounts as of _____ __, 200__.  This list will be updated post
closing with balances as of Bank Closing date.

    

    This
schedule provides account categories and balances as of the date of the deposit
download, or as indicated.  The deposit franchise bid premium will be
calculated using account categories and balances as of Bank Closing Date that
are reflected in the general ledger or subsystem as described
above.  The final numbers for Schedule 7 will be provided post
closing.

    
      
        
          

           

          
            	
                  
	
                     

                  	
                     

                  
	
                     

                  	
                     

                  
	
                     

                  	 
      

          

          	
                  Module
      1 – Whole Bank w/ Loss Share – P&A

                	
                  COOPERATIVE
      BANK

                
	
                  Version
      1.05

                	
                  WILMINGTON,
      NORTH CAROLINA

                
	
                  June
      16, 2009

                	 
      

        

        
        

      

      

    

     

    
      50

      
        

      

    

    
       

    

    
    

    EXHIBIT
4.13

    INTERIM
ASSET SERVICING ARRANGEMENT

    

               (a)           With
respect to each asset (or liability) designated from time to time by the
Receiver to be serviced by the Assuming Bank pursuant to this Arrangement (such
being designated as "Pool Assets"), during the term of this Arrangement, the
Assuming Bank shall:

    

      
         (i) Promptly apply
payments received with respect to any Pool Assets;

    

    (ii)
Reverse and return insufficient funds checks;

    

    (iii) Pay
(A) participation payments to participants in Loans, as and when received; and
(B) tax and insurance bills on Pool Assets as they come due, out of escrow funds
maintained for purposes;

    

    (iv)
Maintain accurate records reflecting (A) the payment history of Pool Assets,
with updated information received concerning changes in the address or identity
of the obligors and (B) usage of data processing equipment and employee services
with respect to servicing duties;

    

     (v)
Send billing statements to obligors on Pool Assets to the extent that such
statements were sent by the Failed Bank;

    

    (vi) Send
notices to obligors who are in default on Loans (in the same manner as the
Failed Bank);

    

               (vii)
Send to the Receiver, Attn: Managing Liquidator, at the address provided in
Section 13.7 of the Agreement, via overnight delivery: (A) on a
weekly basis, weekly reports for the Pool Assets, including, without limitation,
reports reflecting collections and the trial balances, transaction journals and
loan histories for Pool Assets having activity, together with copies of (1)
checks received, (2) insufficient funds checks returned, (3) checks for payment
to participants or for taxes and insurance, (4) pay-off requests, (5) notices to
defaulted obligors, and (6) data processing and employee logs and (B) any other
reports, copies or information as may be periodically or from time to time
requested;

    

                  
         (viii) Remit on a weekly
basis to the Receiver, Attn: Division of Finance, Cashier Unit, Operations, at
the address in (vii), via wire transfer to the
account designated by the Receiver, all payments received on Pool Assets managed
by the Assuming Bank or at such time and place and in such manner as may be
directed by the Receiver;

    

    (ix)
prepare and timely file all information reports with appropriate tax
authorities, and, if required by the Receiver, prepare and file tax returns and
pay taxes due on or before the due date, relating to the Pool Assets;
and

    

    (x)  provide
and furnish such other services, operations or functions as may be required with
regard to Pool Assets, including, without limitation, as may be required
with

    
      
        
          

           

          
            	
                  
	
                     

                  	
                     

                  
	
                     

                  	
                     

                  
	
                     

                  	 
      

          

          	
                  Module
      1 – Whole Bank w/ Loss Share – P&A

                	
                  COOPERATIVE
      BANK

                
	
                  Version
      1.05

                	
                  WILMINGTON,
      NORTH CAROLINA

                
	
                  June
      16, 2009

                	 
      

        

        
        

      

      

    

     

    
      51

      
        

      

    

    
       

    

    
    

    regard to
any business, enterprise or agreement which is a Pool Asset, all as may be
required by the Receiver.

    

    Notwithstanding
anything to the contrary in this Section, the Assuming Bank shall not be
required to initiate litigation or other collection proceedings against any
obligor or any collateral with respect to any defaulted Loan. The Assuming Bank
shall promptly notify the Receiver, at the address provided above in
subparagraph (a)(vii), of any claims or legal actions regarding any Pool
Asset.

    

    (b)           The
Receiver agrees to reimburse the Assuming Bank for actual, reasonable and
necessary expenses incurred in connection with the performance of duties
pursuant to this Arrangement, including expenses of photocopying, postage and
express mail, and data processing and employee services (based upon the number
of hours spent performing servicing duties).

    

    (c)           The
Assuming Bank shall provide the services described herein for an initial period
of ninety (90) days after Bank Closing. At the option of the Receiver,
exercisable by notice given not later than ten (10) days prior to the end of
such initial period or a renewal period, the Assuming Bank shall continue to
provide such services for such renewal period(s) as designated by the Receiver,
up to the Settlement Date.

    

    (d)           At
any time during the term of this Arrangement, the Receiver may, upon written
notice to the Assuming Bank, remove one or more Pool Assets from the Pool, at
which time the Assuming Bank's responsibility with respect thereto shall
terminate.

    

    (e)           At
the expiration of this Agreement or upon the termination of the Assuming Bank's
responsibility with respect to any Pool Asset pursuant to paragraph (d) hereof,
the Assuming Bank shall:

    

    (i)
deliver to the Receiver (or its designee) all of the Credit Documents and Pool
Records relating to the Pool Assets; and

    

    (ii)
cooperate with the Receiver to facilitate the orderly transition of managing the
Pool Assets to the Receiver (or its designee).

    

    (f)           At
the request of the Receiver, the Assuming Bank shall perform such transitional
services with regard to the Pool Assets as the Receiver may request.
Transitional services may include, without limitation, assisting in any due
diligence process deemed necessary by the Receiver and providing to the Receiver
or its designee(s) (x) information and data regarding the Pool Assets,
including, without limitation, system reports and data downloads sufficient to
transfer the Pool Assets to another system or systems, and (y) access to
employees of the Assuming Bank involved in the management of, or otherwise
familiar with, the Pool Assets.

    
      
        
          

           

          
            	
                  
	
                     

                  	
                     

                  
	
                     

                  	
                     

                  
	
                     

                  	 
      

          

          	
                  Module
      1 – Whole Bank w/ Loss Share – P&A

                	
                  COOPERATIVE
      BANK

                
	
                  Version
      1.05

                	
                  WILMINGTON,
      NORTH CAROLINA

                
	
                  June
      16, 2009

                	 
      

        

        
        

      

      

    

     

    
      52

      
        

      

    

    
       

    

    
    

    EXHIBIT
4.15A

     

    SINGLE
FAMILY SHARED-LOSS AGREEMENT

     

    This
agreement for the reimbursement of loss sharing on certain single family
residential mortgage loans (the “Single Family Shared-Loss Agreement”) shall
apply when the Assuming Bank purchases Single Family Shared-Loss Loans as that
term is defined herein. The terms hereof shall modify and supplement, as
necessary, the terms of the Purchase and Assumption Agreement to which this
Single Family Shared-Loss Agreement is attached as Exhibit 4.15A and
incorporated therein. To the extent any inconsistencies may arise between the
terms of the Purchase and Assumption Agreement and this Single Family
Shared-Loss Agreement with respect to the subject matter of this Single Family
Shared-Loss Agreement, the terms of this Single Family Shared-Loss Agreement
shall control. References in this Single Family Shared-Loss Agreement to a
particular Section shall be deemed to refer to a Section in this Single Family
Shared-Loss Agreement, unless the context indicates that it is intended to be a
reference to a Section of the Purchase and Assumption Agreement.

     

    

     

    ARTICLE
I -- DEFINITIONS

     

    The
capitalized terms used in this Single Family Shared-Loss Agreement that are not
defined in this Single Family Shared-Loss Agreement are defined in the Purchase
and Assumption Agreement. In addition to the terms defined above, defined below
are certain additional terms relating to loss-sharing, as used in this Single
Family Shared-Loss Agreement.

     

    “Accounting
Records” means the subsidiary system of record on which the loan history
and balance of each Single Family Shared-Loss Loan is maintained; individual
loan files containing either an original or copies of documents that are
customary and reasonable with respect to loan servicing, including management
and disposition of Other Real Estate; the records documenting alternatives
considered with respect to loans in default or for which a default is reasonably
foreseeable; records of loss calculations and supporting documentation with
respect to line items on the loss calculations; and, monthly delinquency reports
and other performance reports customarily utilized by the Assuming Bank in
management of loan portfolios.

     

    “Accrued
Interest” means, with respect to Single Family Shared-Loss Loans, the
amount of earned and unpaid interest at the note rate specified in the
applicable loan documents, limited to 90 days.

     

    “Affiliate” shall have the meaning set
forth in the Purchase and Assumption Agreement; provided, that, for purposes of
this Single Family Shared-Loss Agreement, no Third Party Servicer shall be
deemed to be an Affiliate of the Assuming Bank.

    

     

    “Commencement
Date” means the first calendar day following the Bank
Closing.

     

    
      
        
          

           

          
            	
                  
	
                     

                  	
                     

                  
	
                     

                  	
                     

                  
	
                     

                  	 
      

          

          	
                  Module
      1 – Whole Bank w/ Loss Share – P&A

                	
                  COOPERATIVE
      BANK

                
	
                  Version
      1.05

                	
                  WILMINGTON,
      NORTH CAROLINA

                
	
                  June
      16, 2009

                	 
      

        

        
        

      

      

    

     

    
      53

      
        

      

    

    
       

    

    
    

    “Commercial
Shared-Loss Agreement” means the Commercial and Other Assets Shared-Loss
Agreement attached to the Purchase and Assumption Agreement as Exhibit
4.15B.

     

    “Cumulative
Loss Amount” means the sum of the Monthly Loss Amounts less the sum of
all Recovery Amounts.

     

    “Cumulative
Shared-Loss Amount” means the excess, if any, of the Cumulative Loss
Amount over the First Loss Tranche.

     

    “Customary
Servicing Procedures” means procedures (including collection procedures)
that the Assuming Bank (or, to the extent a Third Party Servicer is engaged, the
Third Party Servicer) customarily employs and exercises in servicing and
administering mortgage loans for its own accounts and the servicing procedures
established by FNMA or FHLMC (as in effect from time to time), which are in
accordance with accepted mortgage servicing practices of prudent lending
institutions.

     

    “Deficient
Valuation” means
the determination by a court in a bankruptcy proceeding that the value of the
collateral is less than the amount of the loan in which case the loss will be
the difference between the then unpaid principal balance (or the NPV of a
modified loan that defaults) and the value of the collateral so
established.

     

    “Examination
Criteria” means
the loan classification criteria employed by, or any applicable regulations of,
the Assuming Bank’s Chartering Authority at the time such action is taken, as
such criteria may be amended from time to time.

     

    “Home
Equity Loans” means loans or funded portions of lines of credit secured
by mortgages on one-to four-family residences or stock of cooperative housing
associations, where the Failed Bank did not have a first lien on the same
property as collateral.

     

    “Final
Shared-Loss Month” means the calendar month in which the tenth
anniversary of the Commencement Date occurs.

     

    “Final
Shared-Loss Recovery Month” means the calendar month in which the tenth
anniversary of the Commencement Date occurs.

     

    “Foreclosure
Loss” means the loss realized when the Assuming Bank has completed the
foreclosure on a Single Family Shared-Loss Loan and realized final recovery on
the collateral through liquidation and recovery of all insurance
proceeds.  Each Foreclosure Loss shall be calculated in accordance
with the form and methodology specified in Exhibit 2a or Exhibit
2a(1).

     

    “Investor-Owned
Residential Loans” means Loans, excluding advances made pursuant to Home
Equity Loans, that are secured by mortgages on one- to four family residences or
stock of cooperative housing associations that are not owner-occupied. These
loans can be treated as Restructured Loans on a commercially reasonable basis
and can be a restructured under terms separate from the Exhibit 5
standards.  Please refer to Exhibit 2b for guidance in Calculation of
Loss for Restructured Loans.

     

    
      
        
          

           

          
            	
                  
	
                     

                  	
                     

                  
	
                     

                  	
                     

                  
	
                     

                  	 
      

          

          	
                  Module
      1 – Whole Bank w/ Loss Share – P&A

                	
                  COOPERATIVE
      BANK

                
	
                  Version
      1.05

                	
                  WILMINGTON,
      NORTH CAROLINA

                
	
                  June
      16, 2009

                	 
      

        

        
        

      

      

    

     

    
      54

      
        

      

    

    
       

    

    
    

    “Loss”
means a Foreclosure Loss, Restructuring Loss, Short Sale Loss, Portfolio Loss,
Modification Default Loss or Deficient Valuation.

     

    “Loss
Amount” means the dollar amount of loss incurred and reported on the
Monthly Certificate for a Single Family Shared-Loss Loan.

     

    “Modification
Default Loss” means the loss calculated in Exhibits 2a(1) and 2c(1) for
single family loans modified under this part of the agreement that default and
result in a foreclosure or short sale.

     

    “Modification
Guidelines” has
the meaning provided in Section 2.1(a) of this Single Family Shared-Loss
Agreement.

     

    “Monthly
Certificate” has the meaning provided in Section 2.1(b) of this Single
Family Shared-Loss Agreement.

     

    “Monthly
Loss Amount” means the sum of all Foreclosure Losses, Restructuring
Losses, Short Sale Losses, Portfolio Losses, Modification Default Losses and
losses in connection with Deficient Valuations realized by the Assuming Bank for
any Shared Loss Month.

     

    “Monthly
Shared-Loss Amount” means the change in the Cumulative Shared-Loss Amount
from the beginning of each month to the end of each month.

     

    “Neutral
Member” has the meaning provided in Section 2. 1(f)(ii) of this Single
Family Shared-Loss Agreement.

     

     “Portfolio
Loss” means the loss realized on either (i) a portfolio sale of Single
Family Shared-Loss Loans in accordance with the terms of Article IV or (ii) the
sale of a loan with the consent of the Receiver as provided in Section
2.7.

     

    “Recovery
Amount” means, with respect to any period prior to the Termination Date,
the amount of collected funds received by the Assuming Bank that (i) are
applicable against a Foreclosure Loss which has previously been paid to the
Assuming Bank by the Receiver or (ii) gains realized from a Section 4.1 sale of
Single Family Shared-Loss Loans for which the Assuming Bank has previously
received a Restructuring Loss payment from the Receiver (iii) or any incentive
payments from national programs paid to an investor or borrower on loans that
have been modified or otherwise treated (short sale or foreclosure) in
accordance with Exhibit 5.

     

    “Restructuring
Loss” means the loss on a modified or restructured loan measured by the
difference between (a) the principal, Accrued Interest, tax and insurance
advances, third party or other fees due on a loan prior to the modification or
restructuring, and (b) the net present value of estimated cash flows on the
modified or restructured loan, discounted at the Then-Current Interest Rate.
Each Restructuring Loss shall be calculated in accordance with the form and
methodology attached as Exhibit 2b, as applicable.

     

    “Restructured
Loan” means a Single Family Shared-Loss Loan for which the

     

    
      
        
          

           

          
            	
                  
	
                     

                  	
                     

                  
	
                     

                  	
                     

                  
	
                     

                  	 
      

          

          	
                  Module
      1 – Whole Bank w/ Loss Share – P&A

                	
                  COOPERATIVE
      BANK

                
	
                  Version
      1.05

                	
                  WILMINGTON,
      NORTH CAROLINA

                
	
                  June
      16, 2009

                	 
      

        

        
        

      

      

    

     

    
      55

      
        

      

    

    
       

    

    
    

    Assuming
Bank has received a Restructuring Loss payment from the
Receiver.  This applies to owner occupied and investor owned
residences.

     

    “Servicing
Officer” has the meaning provided in Section 2.1(b) of this Single Family
Shared-Loss Agreement.

     

    “Shared
Loss Payment Trigger” means when the sum of the Cumulative Loss Amount
under this Single Family Shared-Loss Agreement and the Shared-Loss Amount under
the Commercial and Other Assets Shared-Loss Agreement, exceeds the First Loss
Tranche.  If the First Loss Tranche is zero or a negative number, the
Shared Loss Payment Trigger shall be deemed to have been reached upon Bank
Closing.

     

    “Shared-Loss
Month” means each calendar month between the Commencement Date and the
last day of the month in which the tenth anniversary of the Commencement Date
occurs, provided that, the first Shared-Loss Month shall begin on the
Commencement Date and end on the last day of that month.

     

    “Short-Sale
Loss” means the loss resulting from the Assuming Bank’s agreement with
the mortgagor to accept a payoff in an amount less than the balance due on the
loan (including the costs of any cash incentives to borrower to agree to such
sale or to maintain the property pending such sale), further provided, that each Short-Sale
Loss shall be calculated in accordance with the form and methodology specified
in Exhibit 2c or Exhibit 2c(1).

     

    “Single
Family Shared-Loss Loans” means the single family one-to-four residential
mortgage loans (whether owned by the Assuming Bank or any Subsidiary) identified
on Schedule 4.15A of the Purchase and Assumption Agreement.

     

    “Stated
Threshold” means total losses under the shared loss agreements in the
amount of $303,000,000.00.

     

    “Termination
Date” means the last day of the Final Shared-Loss Recovery
Month.

     

    “Then-Current
Interest Rate” means the most recently published Freddie Mac survey rate
for 30-year fixed-rate loans.

     

    “Third-Party
Servicer” means any servicer appointed from time to time by the Assuming
Bank or any Affiliate of the Assuming Bank to service the Shared-Loss Loans on
behalf of the Assuming Bank, the identity of which shall be given to the
Receiver prior to or concurrent with the appointment thereof.

     

    ARTICLE
II -- SHARED-LOSS ARRANGEMENT

     

    2.1           Shared-Loss
Arrangement.

     

    (a)           Loss
Mitigation and Consideration of Alternatives. For each Single Family
Shared-Loss Loan in default or for which a default is reasonably foreseeable,
the

     

    
      
        
          

           

          
            	
                  
	
                     

                  	
                     

                  
	
                     

                  	
                     

                  
	
                     

                  	 
      

          

          	
                  Module
      1 – Whole Bank w/ Loss Share – P&A

                	
                  COOPERATIVE
      BANK

                
	
                  Version
      1.05

                	
                  WILMINGTON,
      NORTH CAROLINA

                
	
                  June
      16, 2009

                	 
      

        

        
        

      

      

    

     

    
      56

      
        

      

    

    
       

    

    
    

    Assuming
Bank shall undertake reasonable and customary loss mitigation efforts, in
accordance with any of the following programs selected by Assuming Bank in its
sole discretion, Exhibit 5 (FDIC Mortgage Loan Modification Program), the United
States Treasury's Home Affordable Modification Program Guidelines or any other
modification program approved by the United States Treasury Department, the
Corporation, the Board of Governors of the Federal Reserve System or any other
governmental agency (it being understood that the Assuming Bank can select
different programs for the various Single Family Shared-Loss Loans) (such
program chosen, the “Modification Guidelines”). After selecting the applicable
Modification Guideline for any such Single Family Shared-Loss Loan, the Assuming
Bank shall document its consideration of foreclosure, loan restructuring under
such Modification Guideline chosen, and short-sale (if short-sale is a viable
option) alternatives and shall select the alternative the Assuming Bank
believes, based on its estimated calculations, will result in the least
Loss.  Losses on Home Equity Loans shall be shared under the
charge-off policies of the Assuming Bank’s Examination Criteria as if they were
Single Family Shared-Loss Loans with respect to the calculation of the Stated
Threshold.  Assuming Bank shall retain its calculations of the
estimated loss under each alternative, such calculations to be provided to the
Receiver upon request.  For the avoidance of doubt and notwithstanding
anything herein to the contrary, (i) the Assuming Bank is not required to modify
or restructure any Single Family Shared-Loss Loan on more than one occasion and
(ii) the Assuming Bank is not required to consider any alternatives with respect
to any Shared-Loss Loan in the process of foreclosure as of the Bank Closing and
shall be entitled to continue such foreclosure measures and recover the
Foreclosure Loss as provided herein, and (iii)  the Assuming Bank
shall have a transition period of up to 90 days after Bank Closing to implement
the Modification Guidelines, during which time, the Assuming Bank may submit
claims under such guidelines as may be in place at the Failed Bank.

     

    (b)           Monthly
Certificates.

     

    Not later
than fifteen (15) days after the end of each Shared-Loss Month, beginning with
the month in which the Commencement Date occurs and ending in the month in which
the tenth anniversary of the Commencement Date occurs, the Assuming Bank shall
deliver to the Receiver a certificate, signed by an officer of the Assuming Bank
involved in, or responsible for, the administration and servicing of the Single
Family Shared-Loss Loans whose name appears on a list of servicing officers
furnished by the Assuming Bank to the Receiver, (a “Servicing Officer”) setting
forth in such form and detail as the Receiver may reasonably specify (a “Monthly
Certificate”):

     

    
      	
               
      

            	
              (i)

            	
              (A)

            	
              a
      schedule substantially in the form of Exhibit 1
  listing:

            

    

     

    (i) each
Single Family Shared-Loss Loan for which a Loss Amount (calculated in accordance
with the applicable Exhibit) is being claimed, the related Loss Amount for each
Single Family Shared-Loss Loan, and the total Monthly Loss Amount for all Single
Family Shared-Loss Loans;

     

    (ii) each
Single Family Shared-Loss Loan for which a Recovery Amount was received, the
Recovery Amount for each Single Family Shared-Loss Loan, and the total Recovery
Amount for all

     

    
      
        
          

           

          
            	
                  
	
                     

                  	
                     

                  
	
                     

                  	
                     

                  
	
                     

                  	 
      

          

          	
                  Module
      1 – Whole Bank w/ Loss Share – P&A

                	
                  COOPERATIVE
      BANK

                
	
                  Version
      1.05

                	
                  WILMINGTON,
      NORTH CAROLINA

                
	
                  June
      16, 2009

                	 
      

        

        
        

      

      

    

     

    
      57

      
        

      

    

    
       

    

    
    

    Single
Family Shared-Loss Loans;

     

    (iii) the
total Monthly Loss Amount for all Single Family Shared-Loss Loans minus the
total monthly Recovery Amount for all Single Family Shared-Loss
Loans;

     

    (iv) the
Cumulative Shared-Loss Amount as of the beginning and end of the
month;

     

    (v) the
Monthly Shared Loss Amount;

     

    (vi) the
result obtained in (v) times 80%, or times 95% if the Stated Threshold has been
reached, which in either case is the amount to be paid under Section 2.1(d) of
this Single Family Shared-Loss Agreement by the Receiver to the Assuming Bank if
the amount is a positive number, or by the Assuming Bank to the Receiver if the
amount is a negative number;

     

    
      	
               
      

            	
              (ii)

            	
              (B)

            	
              for
      each of the Single Family Shared-Loss Loans for which a Loss is claimed
      for that Shared-Loss Month, a schedule showing the calculation of the Loss
      Amount using the form and methodology shown in Exhibit 2a, Exhibit 2b, or
      Exhibit 2c, as applicable.

            

    

     

    
      	
               
      

            	
              (iii)

            	
              (C)

            	
              For
      each of the Restructured Loans where a gain or loss is realized in a sale
      under Section 4.1 or 4.2, a schedule showing the calculation using the
      form and methodology shown in Exhibit
2d.

            

    

     

    
      	
               
      

            	
              (iv)

            	
              (D)

            	
              a
      portfolio performance and summary schedule substantially in the form shown
      in Exhibit 3.

            

    

     

    (c)           Monthly
Data Download. Not later than fifteen (15) days after the end of each
month, beginning with the month in which the Commencement Date occurs and ending
with the Final Shared-Loss Recovery Month, Assuming Bank shall provide
Receiver:

     

    
      	
               
      

            	
              (v)

            	
              (i)

            	
              the
      servicing file in machine-readable format including but not limited to the
      following fields for each outstanding Single Family Shared-Loss Loan, as
      applicable:

            

    

     

    
      	
               
      

            	
              (A)

            	
              Loan
      number

            

    

    
      	
               
      

            	
              (B)

            	
              FICO
      score

            

    

    
      	
               
      

            	
              (C)

            	
              Origination
      date

            

    

    
      	
               
      

            	
              (D)

            	
              Original
      principal amount

            

    

    
      	
               
      

            	
              (E)

            	
              Maturity
      date

            

    

    
      	
               
      

            	
              (F)

            	
              Paid-to
      date

            

    

    
      	
               
      

            	
              (G)

            	
              Last
      payment date

            

    

    
      	
               
      

            	
              (H)

            	
              Loan
      status (bankruptcy, in foreclosure,
etc.)

            

    

    
      	
               
      

            	
              (I)

            	
              Delinquency
      counters

            

    

    
      
        
          

           

          
            	
                  
	
                     

                  	
                     

                  
	
                     

                  	
                     

                  
	
                     

                  	 
      

          

          	
                  Module
      1 – Whole Bank w/ Loss Share – P&A

                	
                  COOPERATIVE
      BANK

                
	
                  Version
      1.05

                	
                  WILMINGTON,
      NORTH CAROLINA

                
	
                  June
      16, 2009

                	 
      

        

        
        

      

      

    

     

    
      58

      
        

      

    

    
       

    

    
    

    
      	
               
      

            	
              (J)

            	
              Current
      principal balance

            

    

    
      	
               
      

            	
              (K)

            	
              Current
      escrow account balance

            

    

    
      	
               
      

            	
              (L)

            	
              Current
      Appraisal/BPO value

            

    

    
      	
               
      

            	
              (M)

            	
              Current
      Appraisal/BPO date

            

    

    
      	
               
      

            	
              (N)

            	
              Interest
      rate

            

    

    
      	
               
      

            	
              (O)

            	
              Monthly
      principal and interest payment
amount

            

    

    
      	
               
      

            	
              (P)

            	
              Monthly
      escrow payment for taxes and
insurance

            

    

    
      	
               
      

            	
              (Q)

            	
              Interest
      rate type (fixed or adjustable)

            

    

    
      	
               
      

            	
              (R)

            	
              If
      adjustable: index, margin, next interest rate reset
  date

            

    

    
      	
               
      

            	
              (S)

            	
              Payment/Interest
      rate cap and/or floor

            

    

    
      	
               
      

            	
              (T)

            	
              Underwriting
      type (Full doc, Alt Doc, No Doc)

            

    

    
      	
               
      

            	
              (U)

            	
              Lien
      type (1st,
      2nd)

            

    

    
      	
               
      

            	
              (V)

            	
              Amortization
      type (amortizing or I/O)

            

    

    
      	
               
      

            	
              (W)

            	
              Property
      address, including city, state, zip
code

            

    

    
      	
               
      

            	
              (X)

            	
              A
      code indicating whether the Mortgaged Property is owner
      occupied

            

    

    
      	
               
      

            	
              (Y)

            	
              Property
      type (single-family detached, condominium, duplex,
  etc.)

            

    

    
      	
               
      

            	
              (vi)

            	
              (ii)

            	
              An
      Excel file for ORE held as a result of foreclosure on a Single Family
      Shared-Loss Loan listing:

            

    

     

    
      	
               
      

            	
              (A)

            	
              Foreclosure
      date

            

    

    
      	
               
      

            	
              (B)

            	
              Unpaid
      loan principal balance

            

    

    
      	
               
      

            	
              (C)

            	
              Appraised
      value or BPO value, as applicable

            

    

    
      	
               
      

            	
              (D)

            	
              Projected
      liquidation date

            

    

    

    Notwithstanding the foregoing, the
Assuming Bank shall not be required to provide any of the foregoing information
to the extent it is unable to do so as a result of the Failed Bank’s or
Receiver’s failure to provide information required to produce the information
set forth in this Section 2.1(c); provided, that the
Assuming Bank shall, consistent with Customary Servicing Procedures seek to
produce any such missing information or improve any inaccurate information
previously provided to it.

    (d)           Payments
With Respect to Shared-Loss Assets.

     

    (i)           Losses
Under the Stated Threshold. After the Shared Loss Payment Trigger is
reached, not later than fifteen (15) days after the date on which the Receiver
receives the Monthly Certificate, the Receiver shall pay to the Assuming Bank,
in immediately available funds, an amount equal to eighty percent (80%) of the
Monthly Shared-Loss Amount reported on the Monthly Certificate. If the total
Monthly Shared-Loss Amount reported on the Monthly Certificate is a negative
number, the Assuming Bank shall pay to the Receiver in immediately available
funds eighty percent (80%) of that amount.

     

    (ii)           Losses in
Excess of the Stated Threshold. In the event that the sum of the
Cumulative Loss Amount under this Single Family Shared-Loss Agreement and the
Stated Loss Amount under the Commercial Shared-Loss Agreement meets or exceeds
the Stated Threshold, the loss/recovery sharing percentages set forth herein
shall change from 80/20 to 95/5

     

    
      
        
          

           

          
            	
                  
	
                     

                  	
                     

                  
	
                     

                  	
                     

                  
	
                     

                  	 
      

          

          	
                  Module
      1 – Whole Bank w/ Loss Share – P&A

                	
                  COOPERATIVE
      BANK

                
	
                  Version
      1.05

                	
                  WILMINGTON,
      NORTH CAROLINA

                
	
                  June
      16, 2009

                	 
      

        

        
        

      

      

    

     

    
      59

      
        

      

    

    
       

    

    
    

    and
thereafter the Receiver shall pay to the Assuming Bank, in immediately available
funds, an amount equal to ninety-five percent (95%) of the Monthly Shared-Loss
Amount reported on the Monthly Certificate. If the Monthly Shared-Loss Amount
reported on the Monthly Certificate is a negative number, the Assuming Bank
shall pay to the Receiver in immediately available funds ninety-five percent
(95%) of that amount.

     

    (e)           Limitations
on Shared-Loss Payment. The Receiver shall not be required to make any
payments pursuant to Section 2.1(d) with respect to any Foreclosure Loss,
Restructuring Loss, Short Sale Loss or Portfolio Loss that the Receiver
determines, based upon the criteria set forth in this Single Family Shared-Loss
Agreement (including the analysis and documentation requirements of Section
2.1(a)) or Customary Servicing Procedures, should not have been effected by the
Assuming Bank; provided, however, (x) the Receiver must provide notice to the
Assuming Bank detailing the grounds for not making such payment, (y) the
Receiver must provide
the Assuming Bank with a reasonable opportunity to cure any such deficiency and
(z) (1) to the extent curable, if cured, the Receiver shall make payment with
respect to the properly effected Loss, and (2) to the extent not curable,
notwithstanding the foregoing, the Receiver shall make a payment as to all
Losses (or portion of Losses) that were effected which would have been payable
as a Loss if the Assuming Bank had properly effected such Loss. In the event
that the Receiver does not make any payment with respect to Losses claimed
pursuant to Section 2.1(d), the Receiver and Assuming Bank shall, upon final
resolution, make the necessary adjustments to the Monthly Shared-Loss Amount for
that Monthly Certificate and the payment pursuant to Section 2.1(d) above shall
be adjusted accordingly.

     

    (f)           Payments
by Wire-Transfer. All payments under this Single Family Shared-Loss
Agreement shall be made by wire-transfer in accordance with the wire-transfer
instructions on Exhibit 4.

     

    2.2           Auditor Report; Right to
Audit

     

    (a)           Within
ninety (90) days after the end of each calendar year during which the Receiver
makes any payment to the Assuming Bank under this Single Family Shared-Loss
Agreement, the Assuming Bank shall deliver to the Receiver a report signed by
its independent public accountants stating that they have reviewed the terms of
this Single Family Shared-Loss Agreement and that, in the course of their annual
audit of the Assuming Bank’s books and records, nothing has come to their
attention suggesting that any computations required to be made by the Assuming
Bank during such calendar year pursuant to this Article II were not made by the
Assuming Bank in accordance herewith. In the event that the Assuming Bank cannot
comply with the preceding sentence, it shall promptly submit to the Receiver
corrected computations together with a report signed by its independent public
accountants stating that, after giving effect to such corrected computations,
nothing has come to their attention suggesting that any computations required to
be made by the Assuming Bank during such year pursuant to this Article II were
not made by the Assuming Bank in accordance herewith. In such event, the
Assuming Bank and the Receiver shall make all such accounting adjustments and
payments as may be necessary to give effect to each correction reflected in such
corrected computations, retroactive to the date on which the corresponding
incorrect computation was made.

     

    (b)           The
Receiver or the FDIC in its corporate capacity (“Corporation”) may

     

    
      
        
          

           

          
            	
                  
	
                     

                  	
                     

                  
	
                     

                  	
                     

                  
	
                     

                  	 
      

          

          	
                  Module
      1 – Whole Bank w/ Loss Share – P&A

                	
                  COOPERATIVE
      BANK

                
	
                  Version
      1.05

                	
                  WILMINGTON,
      NORTH CAROLINA

                
	
                  June
      16, 2009

                	 
      

        

        
        

      

      

    

     

    
      60

      
        

      

    

    
       

    

    
    

    perform
an audit or audits to determine the Assuming Bank’s compliance with the
provisions of this Single Family Shared-Loss Agreement, including this Article
II, by providing not less than ten (10) Business Days’ prior written notice.
Assuming Bank shall provide access to pertinent records and proximate working
space in Assuming Bank’s facilities. The scope and duration of any such audit
shall be within the reasonable discretion of the Receiver or the Corporation,
but shall in no event be administered in a manner that unreasonably interferes
with the operation of the Assuming Bank’s business. The Receiver or the
Corporation, as the case may be, shall bear the expense of any such audit. In
the event that any corrections are necessary as a result of such an audit or
audits, the Assuming Bank and the Receiver shall make such accounting
adjustments and payments as may be necessary to give retroactive effect to such
corrections.

     

    2.3           Withholdings.
Notwithstanding any other provision in this Article II, the Receiver, upon the
direction of the Director (or designee) of the Federal Deposit Insurance
Corporation’s Division of Resolutions and Receiverships, may withhold payment
for any amounts included in a Monthly Certificate delivered pursuant to Section
2.1, if in its good faith and reasonable judgment there is a reasonable basis
under the requirements of this Single Family Shared-Loss Agreement for denying
the eligibility of an item for which reimbursement or payment is sought under
such Section. In such event, the Receiver shall provide a written notice to the
Assuming Bank detailing the grounds for withholding such payment. At such time
as the Assuming Bank demonstrates to the satisfaction of the Receiver, in its
reasonable judgment, that the grounds for such withholding of payment, or
portion of payment, no longer exist or have been cured, then the Receiver shall
pay the Assuming Bank the amount withheld which the Receiver determines is
eligible for payment, within fifteen (15) Business
Days.  

     

    2.4           Books and
Records. The Assuming Bank shall at all times during the term of this
Single Family Shared-Loss Agreement keep books and records sufficient to ensure
and document compliance with the terms of this Single Family Shared-Loss
Agreement, including but not limited to (a) documentation of alternatives
considered with respect to defaulted loans or loans for which default is
reasonably foreseeable, (b) documentation showing the calculation of loss for
claims submitted to the Receiver, (c) retention of documents that support each
line item on the loss claim forms, and (d) documentation with respect to the
Recovery Amount on loans for which the Receiver has made a loss-share
payment

     

    2.5           Information.
The Assuming Bank shall promptly provide to the Receiver such other information,
including but not limited to, financial statements, computations, and bank
policies and procedures, relating to the performance of the provisions of this
Single Family Shared-Loss Agreement, as the Receiver may reasonably request from
time to time.

     

    2.6           Tax
Ruling. The Assuming Bank shall not at any time, without the Receiver’s
prior written consent, seek a private letter ruling or other determination from
the Internal Revenue Service or otherwise seek to qualify for any special tax
treatment or benefits associated with any payments made by the Receiver pursuant
to this Single Family Shared-Loss Agreement.

     

    2.7           Sale of
Single Family Shared-Loss Loans. The Receiver shall be relieved of its
obligations with respect to a Single Family Shared-Loss Loan upon payment of a
Foreclosure Loss amount or a Short Sale Loss amount with respect to such Single
Family Shared-Loss Loan or upon the sale of a Single Family Shared-Loss Loan by
Assuming Bank to a person or entity

     

    
      
        
          

           

          
            	
                  
	
                     

                  	
                     

                  
	
                     

                  	
                     

                  
	
                     

                  	 
      

          

          	
                  Module
      1 – Whole Bank w/ Loss Share – P&A

                	
                  COOPERATIVE
      BANK

                
	
                  Version
      1.05

                	
                  WILMINGTON,
      NORTH CAROLINA

                
	
                  June
      16, 2009

                	 
      

        

        
        

      

      

    

     

    
      61

      
        

      

    

    
       

    

    
    

    that is
not an Affiliate; provided, however, that if the Receiver consents to the sale
of any such Single Family Shared-Loss Loan, any loss on such sale shall be a
Portfolio Loss.  The Assuming Bank shall provide the Receiver with
timely notice of any such sale. Notwithstanding the foregoing, a sale of the
Single Family Shared-Loss Loan, for purposes of this Section 2.7, shall not be
deemed to have occurred as the result of (i) any change in the ownership or
control of Assuming Bank or the transfer of any or all of the Single Family
Shared-Loss Loan(s) to any Affiliate of Assuming Bank, (ii) a merger by Assuming
Bank with or into any other entity, (iii) a sale by Assuming Bank of all or
substantially all of its assets. 

     

    ARTICLE
III -- RULES REGARDING THE ADMINISTRATION OF SINGLE FAMILY

    SHARED-LOSS
LOANS

     

    3.1           Agreement
with Respect to Administration. The Assuming Bank shall (and shall cause
any of its Affiliates to which the Assuming Bank transfers any Single Family
Shared-Loss Loans to) manage, administer, and collect the Single Family
Shared-Loss Loans while owned by the Assuming Bank or any Affiliate thereof
during the term of this Single Family Shared-Loss Agreement in accordance with
the rules set forth in this Article III. The Assuming Bank shall be responsible
to the Receiver in the performance of its duties hereunder and shall provide to
the Receiver such reports as the Receiver reasonably deems advisable, including
but not limited to the reports required by Sections 2.1, 2.2 and 3.3 hereof, and
shall permit the Receiver to monitor the Assuming Bank’s performance of its
duties hereunder.

     

    3.2           Duties of
the Assuming Bank. (a) In performance of its duties under this Article
III, the Assuming Bank shall:

     

    (i)
manage and administer each Single Family Shared-Loss Loan in accordance with
Assuming Bank’s usual and prudent business and banking practices and Customary
Servicing Procedures;

     

    (ii)
exercise its best business judgment in managing, administering and collecting
amounts owed on the Single Family Shared-Loss Loans;

     

    (iii) use
commercially reasonable efforts to maximize Recoveries with respect to Losses on
Single Family Shared-Loss Loans without regard to the effect of maximizing
collections on assets held by the Assuming Bank or any of its Affiliates that
are not Single Family Shared-Loss Loans;

     

    (iv)
retain sufficient staff (in Assuming Bank’s discretion) to perform its duties
hereunder; and

     

    (v) other
than as provided in Section 2.1(a), comply with the terms of the Modification
Guidelines for any Single Family Shared-Loss Loans meeting the requirements set
forth therein. For the avoidance of doubt, the Assuming Bank may propose
exceptions to Exhibit 5 (the FDIC Loan Modification Program) for a group of
Loans with similar characteristics, with the objectives of (1) minimizing the
loss to the Assuming Bank and the FDIC and (2) maximizing the opportunity for
qualified homeowners to remain in their homes with affordable mortgage
payments.

     

    (b)           Any
transaction with or between any Affiliate of the Assuming Bank with respect to
any Single Family Shared-Loss Loan including, without limitation, the execution
of

     

    
      
        
          

           

          
            	
                  
	
                     

                  	
                     

                  
	
                     

                  	
                     

                  
	
                     

                  	 
      

          

          	
                  Module
      1 – Whole Bank w/ Loss Share – P&A

                	
                  COOPERATIVE
      BANK

                
	
                  Version
      1.05

                	
                  WILMINGTON,
      NORTH CAROLINA

                
	
                  June
      16, 2009

                	 
      

        

        
        

      

      

    

     

    
      62

      
        

      

    

    
       

    

    
    

    any
contract pursuant to which any Affiliate of the Assuming Bank will manage,
administer or collect any of the Single Family Shared-Loss Loans will be
provided to FDIC for informational purposes and if such transaction is not
entered into on an arm’s length basis on commercially reasonable terms such
transaction shall be subject to the prior written approval of the
Receiver.

     

    3.3           Shared-Loss
Asset Records and Reports. The Assuming Bank shall establish and maintain
such records as may be appropriate to account for the Single Family Shared-Loss
Loans in such form and detail as the Receiver may reasonably require, and to
enable the Assuming Bank to prepare and deliver to the Receiver such reports as
the Receiver may from time to time request regarding the Single Family
Shared-Loss Loans and the Monthly Certificates required by Section 2.1 of this
Single Family Shared-Loss Agreement.

     

    3.4           Related
Loans.

     

    (a)           Assuming
Bank shall use its best efforts to determine which loans are “Related Loans”, as
hereinafter defined. The Assuming Bank shall not manage, administer or collect
any “Related Loan” in any manner that would have the effect of increasing the
amount of any collections with respect to the Related Loan to the detriment of
the Single Family Shared-Loss Loan to which such loan is related. A “Related
Loan” means any loan or extension of credit held by the Assuming Bank at any
time on or prior to the end of the Final Shared-Loss Month that is made to an
Obligor of a Single Family Shared-Loss Loan.

     

    (b)           The
Assuming Bank shall prepare and deliver to the Receiver with the Monthly
Certificates for the calendar months ending June 30 and December 31, a schedule
of all Related Loans on the Accounting Records of the Assuming Bank as of the
end of each such semi-annual period.

     

    3.5           Legal
Action; Utilization of Special Receivership Powers. The Assuming Bank
shall notify the Receiver in writing (such notice to be given in accordance with
Article V below and to include all relevant details) prior to utilizing in any
legal action any special legal power or right which the Assuming Bank derives as
a result of having acquired an asset from the Receiver, and the Assuming Bank
shall not utilize any such power unless the Receiver shall have consented in
writing to the proposed usage. The Receiver shall have the right to direct such
proposed usage by the Assuming Bank and the Assuming Bank shall comply in all
respects with such direction. Upon request of the Receiver, the Assuming Bank
will advise the Receiver as to the status of any such legal action. The Assuming
Bank shall immediately notify the Receiver of any judgment in litigation
involving any of the aforesaid special powers or rights.

     

    3.6           Third-Party
Servicer. The Assuming Bank may perform any of its obligations and/or
exercise any of its rights under this Single Family Shared-Loss Agreement
through or by one or more Third-Party Servicers, who may take actions and make
expenditures as if any such Third-Party Servicer was the Assuming Bank hereunder
(and, for the avoidance of doubt, such expenses incurred by any such Third Party
Servicer on behalf of the Assuming Bank shall be included in calculating Losses
to the extent such expenses would be included in such calculation if the
expenses were incurred by Assuming Bank); provided, however, that the use
thereof by the Assuming Bank shall not release the Assuming Bank of any
obligation or liability hereunder.

     

    
      
        
          

           

          
            	
                  
	
                     

                  	
                     

                  
	
                     

                  	
                     

                  
	
                     

                  	 
      

          

          	
                  Module
      1 – Whole Bank w/ Loss Share – P&A

                	
                  COOPERATIVE
      BANK

                
	
                  Version
      1.05

                	
                  WILMINGTON,
      NORTH CAROLINA

                
	
                  June
      16, 2009

                	 
      

        

        
        

      

      

    

     

    
      63

      
        

      

    

    
       

    

    
    

    

     

    ARTICLE
IV – PORTFOLIO SALE

     

    4.1           Assuming
Bank Portfolio Sales of Remaining Single Family Shared-Loss Loans. The
Assuming Bank shall have the right with the concurrence of the Receiver to
liquidate for cash consideration, from time to time in one or more transactions,
all or a portion of Single Family Shared-Loss Loans held by the Assuming Bank at
any time prior to the Termination Date (“Portfolio Sales”). If the Assuming Bank
exercises its option under this Section 4.1, it must give thirty (30) days
notice in writing to the Receiver setting forth the details and schedule for the
Portfolio Sale which shall be conducted by means of sealed bid sales to third
parties, not including any of the Assuming Bank’s affiliates, contractors, or
any affiliates of the Assuming Bank’s contractors. Sales of Restructured Loans
shall be sold in a separate pool from Single Family Shared-Loss Loans not
restructured. The Receiver’s review of the Assuming Bank’s proposed Portfolio
Sale will be considered in a timely fashion and approval will not be
unreasonably withheld, delayed or conditioned.

     

    4.2           Assuming
Bank’s Liquidation of Remaining Single Family Shared-Loss Loans. In the
event that the Assuming Bank does not conduct a Portfolio Sale pursuant to
Section 4.1, the Receiver shall have the right, exercisable in its sole and
absolute discretion, to require the Assuming Bank to liquidate for cash
consideration, any Single Family Shared-Loss Loans held by the Assuming Bank at
any time after the date that is six months prior to the Termination Date. If the
Receiver exercises its option under this Section 4.2, it must give notice in
writing to the Assuming Bank, setting forth the time period within which the
Assuming Bank shall be required to liquidate the Single Family Shared-Loss
Loans. The Assuming Bank will comply with the Receiver’s notice and must
liquidate the Single Family Shared-Loss Loans as soon as reasonably practicable
by means of sealed bid sales to third parties, not including any of the Assuming
Bank’s affiliates, contractors, or any affiliates of the Assuming Bank’s
contractors. The selection of any financial advisor or other third party broker
or sales agent retained for the liquidation of the remaining Single Family
Shared-Loss Loans pursuant to this Section shall be subject to the prior
approval of the Receiver, such approval not to be unreasonably withheld, delayed
or conditioned.

     

    4.3           Calculation
of Sale Gain or Loss. For Single Family Shared-Loss Loans that are not
Restructured Loans gain or loss on the sales under Section 4.1 or Section 4.2
will be calculated as the sale price received by the Assuming Bank less the
unpaid principal balance of the remaining Single Family Shared-Loss Loans. For
any Restructured Loan included in the sale gain or loss on sale will be
calculated as (a) the sale price received by the Assuming Bank less (b) the net
present value of estimated cash flows on the Restructured Loan that was used in
the calculation of the related Restructuring Loss plus (c) Loan principal
payments collected by the Assuming Bank from the date the Loan was restructured
to the date of sale. (See Exhibit 2d for example calculation).

     

    ARTICLE
V -- LOSS-SHARING NOTICES GIVEN TO RECEIVER AND PURCHASER

     

    All
notices, demands and other communications hereunder shall be in writing and
shall be delivered by hand, or overnight courier, receipt requested, addressed
to the parties as follows:

     

    
      
        
          

           

          
            	
                  
	
                     

                  	
                     

                  
	
                     

                  	
                     

                  
	
                     

                  	 
      

          

          	
                  Module
      1 – Whole Bank w/ Loss Share – P&A

                	
                  COOPERATIVE
      BANK

                
	
                  Version
      1.05

                	
                  WILMINGTON,
      NORTH CAROLINA

                
	
                  June
      16, 2009

                	 
      

        

        
        

      

      

    

     

    
      64

      
        

      

    

    
       

    

    
    

    

     

    
      	
               
      

            	
              If
      to Receiver, to:

            	
              Federal
      Deposit Insurance Corporation as Receiver for COOPERATIVE
      BANK

            

    

    
      	
               
      

            	
              Division
      of Resolutions and Receiverships

            

    

    
      	
               
      

            	
              550
      17th Street, N.W.

            

    

    
      	
               
      

            	
              Washington,
      D.C. 20429

            

    

    
      	
               
      

            	
              Attention:
      Ralph Malami, Manager, Capital
Markets

            

    

     

    
      	
               
      

            	
              with
      a copy to:

            	
              Federal
      Deposit Insurance Corporation

            

    

    
      	
               
      

            	
              as
      Receiver for COOPERATIVE
      BANK

            

    

    
      	
               
      

            	
              Room
      E7056

            

    

    
      	
               
      

            	
              3501
      Fairfax Drive, Arlington, VA 2226

            

    

    
      	
               
      

            	
              Attn:
      Special Issues Unit

            

    

     

    With
respect to a notice under Section 3.5 of this Single Family Shared-Loss
Agreement, copies of such notice shall be sent to:

     

    
      	
               
      

            	
              Federal
      Deposit Insurance Corporation

            

    

    
      	
               
      

            	
              Legal
      Division 1601 Bryan Street

            

    

    
      	
               
      

            	
              Dallas,
      Texas 75201

            

    

    
      	
               
      

            	
              Attention:
      Regional Counsel

            

    

     

    If to
Assuming Bank, to:

    

     

    First
Bank

    341 North Main
Street

    PO Box
508

    Troy, NC
27371

    

     

    Such
Persons and addresses may be changed from time to time by notice given pursuant
to the provisions of this Article V. Any notice, demand or other communication
delivered pursuant to the provisions of this Article IV shall be deemed to have
been given on the date actually received.

     

    

     

    ARTICLE
VI -- MISCELLANEOUS

     

    6.1.           Expenses.  Except
as otherwise expressly provided herein, all costs and expenses incurred by or on
behalf of a party hereto in connection with this Single Family Shared-Loss
Agreement shall be borne by such party whether or not the transactions
contemplated herein shall be consummated.

     

    6.2            Successors
and Assigns; Specific Performance.  All terms and
provisions of this Single Family Shared-Loss Agreement shall be binding upon and
shall inure to the benefit of the parties hereto only; provided, however, that,
Receiver may assign or otherwise transfer this Single Family Shared-Loss
Agreement (in whole or in part) to the Federal Deposit Insurance Corporation in
its corporate capacity without the consent of Assuming Bank. 
Notwithstanding anything to the contrary contained in this Single Family
Shared-Loss Agreement, except as is

     

    
      
        
          

           

          
            	
                  
	
                     

                  	
                     

                  
	
                     

                  	
                     

                  
	
                     

                  	 
      

          

          	
                  Module
      1 – Whole Bank w/ Loss Share – P&A

                	
                  COOPERATIVE
      BANK

                
	
                  Version
      1.05

                	
                  WILMINGTON,
      NORTH CAROLINA

                
	
                  June
      16, 2009

                	 
      

        

        
        

      

      

    

     

    
      65

      
        

      

    

    
       

    

    
    

    expressly
permitted in this Section 6.2, Assuming Bank may not assign or otherwise
transfer this Single Family Shared-Loss Agreement (in whole or in part) without
the prior written consent of the Receiver, which consent may be granted or
withheld by the Receiver in its sole discretion, and any attempted assignment or
transfer in violation of this provision shall be void ab initio.  For the
avoidance of doubt, a merger or consolidation of the Assuming Bank with and into
another financial institution, the sale of all or substantially all of the
assets of the Assuming Bank to another financial institution constitutes the
transfer of this Single Family Shared-Loss Agreement which requires the consent
of the Receiver.  No Loss shall be recognized as a result of any
accounting adjustments that are made due to any such merger, consolidation or
sale consented to by the FDIC.

     

    6.3           Governing
Law. This Single Family Shared-Loss Agreement shall be construed in
accordance with federal law, or, if there is no applicable federal law, the laws
of the State of New York, without regard to any rule of conflict of law that
would result in the application of the substantive law of any jurisdiction other
than the State of New York.

     

    6.4           WAIVER OF
JURY TRIAL. EACH PARTY HERETO HEREBY IRREVOCABLY AND UNCONDITIONALLY
WAIVES ALL RIGHT TO TRIAL BY JURY IN OR TO HAVE A JURY PARTICIPATE IN RESOLVING
ANY DISPUTE, ACTION, PROCEEDING OR COUNTERCLAIM, WHETHER SOUNDING IN CONTRACT,
TORT OR OTHERWISE, ARISING OUT OF OR RELATING TO OR IN CONNECTION WITH THIS
SINGLE FAMILY SHARED-LOSS AGREEMENT OR ANY OF THE TRANSACTIONS CONTEMPLATED
HEREBY.

     

    6.5           Captions.
All captions and headings contained in this Single Family Shared-Loss Agreement
are for convenience of reference only and do not form a part of, and shall not
affect the meaning or interpretation of, this Single Family Shared-Loss
Agreement.

     

    6.6           Entire
Agreement; Amendments. This Single Family Shared-Loss Agreement, along
with the Commercial Shared-Loss Agreement and the Purchase and Assumption
Agreement, including the Exhibits and any other documents delivered pursuant
hereto or thereto, embody the entire agreement of the parties with respect to
the subject matter hereof, and supersede all prior representations, warranties,
offers, acceptances, agreements and understandings, written or oral, relating to
the subject matter herein. This Single Family Shared-Loss Agreement may be
amended or modified or any provision thereof waived only by a written instrument
signed by both parties or their respective duly authorized agents.

     

    6.7           Severability.
Whenever possible, each provision of this Single Family Shared-Loss Agreement
shall be interpreted in such manner as to be effective and valid under
applicable law, but if any provision of this Single Family Shared-Loss Agreement
is held to be prohibited by or invalid, illegal or unenforceable under
applicable law, such provision shall be construed and enforced as if it had been
more narrowly drawn so as not to be prohibited, invalid, illegal or
unenforceable, and the validity, legality and enforceability of the remainder of
such provision and the remaining provisions of this Single Family Shared-Loss
Agreement shall not in any way be affected or impaired thereby.

     

    6.8           No Third
Party Beneficiary. This Single Family Shared-Loss Agreement
and

     

    
      
        
          

           

          
            	
                  
	
                     

                  	
                     

                  
	
                     

                  	
                     

                  
	
                     

                  	 
      

          

          	
                  Module
      1 – Whole Bank w/ Loss Share – P&A

                	
                  COOPERATIVE
      BANK

                
	
                  Version
      1.05

                	
                  WILMINGTON,
      NORTH CAROLINA

                
	
                  June
      16, 2009

                	 
      

        

        
        

      

      

    

     

    
      66

      
        

      

    

    
       

    

    
    

    the
Exhibits hereto are for the sole and exclusive benefit of the parties hereto and
their respective permitted successors and permitted assigns and there shall be
no other third party beneficiaries, and nothing in this Single Family
Shared-Loss Agreement or the Exhibits shall be construed to grant to any other
Person any right, remedy or Claim under or in respect of this Single Family
Shared-Loss Agreement or any provision hereof.

     

    6.9     
       Counterparts.
This Single Family Shared-Loss Agreement may be executed separately by Receiver
and Assuming Bank in any number of counterparts, each of which when executed and
delivered shall be an original, but such counterparts shall together constitute
one and the same instrument.

     

    6.10           Consent.
Except as otherwise provided herein, when the consent of a party is required
herein, such consent shall not be unreasonably withheld or delayed.

     

    6.11           Rights
Cumulative. Except as otherwise expressly provided herein, the rights of
each of the parties under this Single Family Shared-Loss Agreement are
cumulative, may be exercised as often as any party considers appropriate and are
in addition to each such party’s rights under the Purchase and Sale Agreement
and any of the related agreements or under law. Except as otherwise expressly
provided herein, any failure to exercise or any delay in exercising any of such
rights, or any partial or defective exercise of such rights, shall not operate
as a waiver or variation of that or any other such right.

     

    

     

    ARTICLE
VII

    DISPUTE
RESOLUTION

     

    7.1           Dispute
Resolution Procedures.

     

    (a)           In the event a dispute arises
about the interpretation, application, calculation of Loss, or calculation of
payments or otherwise with respect to this Single Family Shared-Loss
Agreement (“SF
Shared-Loss
Dispute Item”), then the Receiver and the Assuming Bank shall make every attempt
in good faith to resolve such items within sixty (60) days following the receipt
of a written description of the SF Shared-Loss Dispute Item, with notification
of the possibility of taking the matter to arbitration (the date on which such
60-day period expires, or any extension of such period as the parties hereto may
mutually agree to in writing, herein called the “Resolution Deadline Date”). If
the Receiver and the Assuming Bank resolve all such items to their mutual
satisfaction by the Resolution Deadline Date, then within thirty (30) days
following such resolution, any payment arising out such resolution shall be made
arising from the settlement of the SF Shared-Loss Dispute.

     

    (b)           If the Receiver and the
Assuming Bank fail to resolve any outstanding SF Shared-Loss Dispute Items by
the Resolution Deadline Date, then either party may notify the other of its
intent to submit the SF Shared-Loss Dispute Item to arbitration pursuant to the
provisions of this Article VII. Failure of either party to notify the other of
its intent to submit any unresolved SF Shared-Loss Dispute Item to arbitration
within thirty (30) days following the Resolution Deadline Date (the date on
which such thirty (30) day period expires is herein called the “Arbitration
Deadline Date”) shall be deemed an acceptance of such SF Shared-Loss Dispute
not

     

    
      
        
          

           

          
            	
                  
	
                     

                  	
                     

                  
	
                     

                  	
                     

                  
	
                     

                  	 
      

          

          	
                  Module
      1 – Whole Bank w/ Loss Share – P&A

                	
                  COOPERATIVE
      BANK

                
	
                  Version
      1.05

                	
                  WILMINGTON,
      NORTH CAROLINA

                
	
                  June
      16, 2009

                	 
      

        

        
        

      

      

    

     

    
      67

      
        

      

    

    
       

    

    
    

    submitted to arbitration, as
well as a waiver of the submitting party’s right to dispute such non-submitted
SF Shared-Loss Dispute Item but not a waiver of any similar claim which may
arise in the future.

     

    (c)           If a SF Shared-Loss Dispute
Item is submitted to arbitration, it shall be governed by the rules of the
American Arbitration Association (the “AAA”), except as otherwise provided
herein. Either party may submit a matter for arbitration by delivering a notice,
prior to the Arbitration Deadline Date, to the other party in writing setting
forth:

     

    (i)           A brief description of each
SF Shared-Loss Dispute Item submitted for arbitration;

     

    (ii)           A statement of the moving
party’s position with respect to each SF Shared-Loss Dispute Item submitted for
arbitration;

     

    (iii)           The value sought by the
moving party, or other relief requested regarding each SF Shared-Loss Dispute
Item submitted for arbitration, to the extent reasonably calculable;
and

     

    (iv)           The name and address of the
arbiter selected by the moving party (the “Moving Arbiter”), who shall be a
neutral, as determined by the AAA.

     

    Failure
to adequately include any information above shall not be deemed to be a waiver
of the parties right to arbitrate so long as after notification of such failure
the moving party cures such failure as promptly as reasonably
practicable.

     

    (d)           The non-moving party shall,
within thirty (30) days following receipt of a notice of arbitration pursuant to
this Section 6.1, deliver a notice to the moving party setting
forth:

     

    (i)           The name and address of the
arbiter selected by the non-moving party (the “Respondent Arbiter”), who shall
be a neutral, as determined by the AAA;

     

    (ii)           A statement of the position
of the respondent with respect to each Dispute Item; and

     

    (iii)           The ultimate resolution
sought by the respondent or other relief, if any, the respondent deems is due
the moving party with respect to each SF Shared-Loss Dispute
Item.

     

    Failure
to adequately include any information above shall not be deemed to be a waiver
of the non-moving party’s right to defend such arbitration so long as after
notification of such failure the non-moving party cures such failure as promptly
as reasonably practicable

     

    (e)           The Moving Arbiter and
Respondent Arbiter shall select a third arbiter from a list furnished by the
American Arbitration Association (the “AAA”). In accordance with the rules of
the AAA, the three (3) arbiters shall constitute the arbitration panel for
resolution of each SF Loss-Share Dispute Item. The concurrence of any two (2)
arbiters shall be deemed to be the decision of the arbiters for all purposes
hereunder. The arbitration shall proceed on such time schedule and in accordance
with the Rules of Commercial Arbitration of the AAA then in effect, as modified
by this Section 7.1. The arbitration proceedings shall take place at such
location as the parties thereto may mutually agree, but if they cannot agree,
then they will take place at the offices of the Corporation in Washington, DC, or Arlington, Virginia.

     

    
      
        
          

           

          
            	
                  
	
                     

                  	
                     

                  
	
                     

                  	
                     

                  
	
                     

                  	 
      

          

          	
                  Module
      1 – Whole Bank w/ Loss Share – P&A

                	
                  COOPERATIVE
      BANK

                
	
                  Version
      1.05

                	
                  WILMINGTON,
      NORTH CAROLINA

                
	
                  June
      16, 2009

                	 
      

        

        
        

      

      

    

     

    
      68

      
        

      

    

    
       

    

    
    

    

     

    (f)           The Receiver and Assuming
Bank shall facilitate the resolution of each outstanding SF Shared-Loss Dispute
Item by making available in a prompt and timely manner to one another and to the
arbiters for examination and copying, as appropriate, all documents, books, and
records under their respective control and that would be discoverable under the
Federal Rules of Civil Procedure.

     

    (g)           The arbiters designated
pursuant to subsections (c), (d) and (e) hereof shall select, with respect to
each Dispute Item submitted to arbitration pursuant to this Section 7.1, either
(i) the position and relief submitted by the Assuming Bank with respect to each
SF Shared-Loss Dispute Item, or (ii) the position and relief submitted by the
Receiver with respect to each SF Shared-Loss Dispute Item, in either case as set
forth in its respective notice of arbitration. The arbiters shall have no
authority to select a value for each Dispute Item other than the determination
set forth in Section 7.1(c) and Section 7.1(d). The arbitration shall be
final, binding and conclusive on the parties.

     

    (h)           Any amounts ultimately
determined to be payable pursuant to such award shall bear interest at the
Settlement Interest Rate from and including the date specified for the arbiters
decisions specified in this Section 7.1, without regard to any extension of the
finality of such award, to but not including the date paid. All payments
required to be made under this Section 7.1 shall be made by wire
transfer.

     

    (i)           For
the avoidance of doubt, to the extent any notice of a SF Shared-Loss Dispute
Item(s) is provided prior to the Termination Date, the terms of this Single
Family Shared-Loss Agreement shall remain in effect with respect to the Single
Family Shared-Loss Loans that are the subject of such SF Shared-Loss Dispute
Item(s) until such time as any such dispute is finally resolved.

     

    7.2           Fees
and Expenses of Arbiters.  The aggregate
fees and expenses of the arbiters shall be shall be borne equally by the
parties.  The parties shall the aggregate fees and
expenses within thirty (30) days after receipt of the written decision of the
arbiters (unless the arbiters agree in writing on some other payment
schedule).

     

    Exhibit
1

     

    Monthly
Certificate

     

    SEE
FOLLOWING PAGE

     

    
      
        
          

           

          
            	
                  
	
                     

                  	
                     

                  
	
                     

                  	
                     

                  
	
                     

                  	 
      

          

          	
                  Module
      1 – Whole Bank w/ Loss Share – P&A

                	
                  COOPERATIVE
      BANK

                
	
                  Version
      1.05

                	
                  WILMINGTON,
      NORTH CAROLINA

                
	
                  June
      16, 2009

                	 
      

        

        
        

      

      

    

     

    
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                    Module
      1 – Whole Bank w/ Loss Share – P&A

                  	
                    COOPERATIVE
      BANK

                  
	
                    Version
      1.05

                  	
                    WILMINGTON,
      NORTH CAROLINA

                  
	
                    June
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                Pursuant
      to Section 2.1 of the Single Family Shared-Loss Agreement, the undersigned
      hereby certifies the information on this Certificate is true, complete and
      correct.

              
	
                OFFICER
      SIGNATURE

              
	
                OFFICER
      NAME:

              	
                TITLE

              

      

      

    

     

     

     

    
      
        
          
             

            
              	
                    
	
                       

                    	
                       

                    
	
                       

                    	
                       

                    
	
                       

                    	 
      

            

            	
                    Module
      1 – Whole Bank w/ Loss Share – P&A

                  	
                    COOPERATIVE
      BANK

                  
	
                    Version
      1.05

                  	
                    WILMINGTON,
      NORTH CAROLINA

                  
	
                    June
      16, 2009

                  	 
      

          

          
          

        

        

      

       

      
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    Exhibit
2a
 

    This
exhibit contains three versions of the loss share calculation for foreclosure,
plus explanatory notes.

    

    

    

      
        
          
             

            
              	
                    
	
                       

                    	
                       

                    
	
                       

                    	
                       

                    
	
                       

                    	 
      

            

            	
                    Module
      1 – Whole Bank w/ Loss Share – P&A

                  	
                    COOPERATIVE
      BANK

                  
	
                    Version
      1.05

                  	
                    WILMINGTON,
      NORTH CAROLINA

                  
	
                    June
      16, 2009

                  	 
      

          

          
          

        

        

      

       

    

    
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                  Module
      1 – Whole Bank w/ Loss Share – P&A

                	
                  COOPERATIVE
      BANK

                
	
                  Version
      1.05

                	
                  WILMINGTON,
      NORTH CAROLINA

                
	
                  June
      16, 2009

                	 
      

        

        
        

      

      

    

     

    
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                  Module
      1 – Whole Bank w/ Loss Share – P&A

                	
                  COOPERATIVE
      BANK

                
	
                  Version
      1.05

                	
                  WILMINGTON,
      NORTH CAROLINA

                
	
                  June
      16, 2009

                	 
      

        

        
        

      

      

    

     

    
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    Notes
to Exhibit 2a (foreclosure)

    

    
      	
               
      

            	
              1.

            	
              The
      data shown are for illustrative purpose.  The figures will vary
      for actual restructurings.

            

    

    
      	
               
      

            	
              2.

            	
              The
      covered loss is the difference between the gross balance recoverable by
      Purchaser and the total cash recovery.  There are three methods
      of calculation for covered losses from foreclosures, depending upon the
      circumstances.  They are shown
below:

            

    

    
      	
               
      

            	
              a.

            	
              If
      foreclosure occurred prior to the beginning of the Loss Share agreement,
      use Exhibit 2a(1).  This version uses the book value of the REO
      as the starting point for the covered
loss.

            

    

    
      	
               
      

            	
              b.

            	
              If
      foreclosure occurred after the Loss Share agreement was in place, and if
      the loan was not restructured when the Loss Share agreement was in place,
      use Exhibit 2a(2).  This version uses the unpaid balance of the
      loan as of the last payment as the starting point for the covered
      loss.

            

    

    
      	
               
      

            	
              c.

            	
              If
      the loan was restructured when the Loss Share agreement was in place, and
      then foreclosure occurred, use Exhibit 2a(3).  This version uses
      the Net Present Value (NPV) of the modified loan as the starting point for
      the covered loss.

            

    

    
      	
               
      

            	
              3.

            	
              For
      Exhibit 2a(1), the gross balance recoverable by the purchaser is
      calculated as the sum of lines 9 – 18; it is shown in line 19. For Exhibit
      2a(2), the gross balance recoverable by the purchaser is calculated as the
      sum of lines 16 – 24; it is shown in line 25. For Exhibit 2a(3), the gross
      balance recoverable by the purchaser is calculated as line 11 minus line
      12 plus lines 13 – 21; it is shown in line
22.

            

    

    
      	
               
      

            	
              4.

            	
              For
      Exhibit 2a(1), the total cash recovery is calculated as the sum of lines
      20 – 24; it is shown in line 25. For Exhibit 2a(2), the total cash
      recovery is calculated as the sum of lines 26 – 30; it is shown in line
      31. For Exhibit 2a(3), the total cash recovery is calculated as the sum of
      lines 23 – 27; it is shown in line
28.

            

    

    
      	
               
      

            	
              5.

            	
              Reasonable
      and customary third party attorney’s fees and expenses incurred by or on
      behalf of Assuming Bank in connection with any enforcement procedures, or
      otherwise with respect to such loan, are reported under Attorney’s
      fees.

            

    

    
      	
               
      

            	
              6.

            	
              Assuming
      Bank’s (or Third Party Servicer’s) reasonable and customary out-of-pocket
      costs paid to either a third party or an affiliate (if affiliate is
      pre-approved by the FDIC) for foreclosure, property protection and
      maintenance costs, repairs, assessments, taxes, insurance and similar
      items are treated as part of the gross recoverable balance, to the extent
      they are not paid from funds in the borrower’s escrow
      account.  Allowable costs are limited to amounts per Freddie Mac
      and Fannie Mae guidelines (as in effect from time to time), where
      applicable, provided that this limitation shall not apply to costs or
      expenses relating to environmental
conditions.

            

    

    
      	
               
      

            	
              7.

            	
              Do
      not include late fees, prepayment penalties, or any similar lender fees or
      charges by the Failed Bank or Assuming Bank to the loan account, any
      allocation of Assuming Bank’s servicing costs, or any allocations of
      Assuming Bank’s general and administrative (G&A) or other operating
      costs.

            

    

    
      	
               
      

            	
              8.

            	
              If
      Exhibit 2a(3) is used, then no accrued interest may be included as a
      covered loss.  Otherwise, the amount of accrued interest that
      may be included as a covered loss is limited to the minimum
      of:

            

    

    
      	
               
      

            	
              a.

            	
              90
      days

            

    

    
      	
               
      

            	
              b.

            	
              The
      number of days that the loan is delinquent when the property was
      sold

            

    

    
      
        
           

          
            	
                  
	
                     

                  	
                     

                  
	
                     

                  	
                     

                  
	
                     

                  	 
      

          

          	
                  Module
      1 – Whole Bank w/ Loss Share – P&A

                	
                  COOPERATIVE
      BANK

                
	
                  Version
      1.05

                	
                  WILMINGTON,
      NORTH CAROLINA

                
	
                  June
      16, 2009

                	 
      

        

        
        

      

      

    

     

    
      75

      
        

      

    

    
       

    

    
    

    
      	
               
      

            	
              c.

            	
              The
      number of days between the resolution date and the date when the property
      was sold

            

    

    To
calculate accrued interest, apply the note interest rate that would have been in
effect if the loan were performing to the principal balance after application of
the last payment made by the borrower.

     

     

    
 

    
      
        
          

           

          
            	
                  
	
                     

                  	
                     

                  
	
                     

                  	
                     

                  
	
                     

                  	 
      

          

          	
                  Module
      1 – Whole Bank w/ Loss Share – P&A

                	
                  COOPERATIVE
      BANK

                
	
                  Version
      1.05

                	
                  WILMINGTON,
      NORTH CAROLINA

                
	
                  June
      16, 2009

                	 
      

        

        
        

      

      

    

     

    
      76

      
        

      

    

    
       

    

    
    

    Exhibit
2b

    

    This
exhibit contains the loss share calculation for restructuring (loan mod), plus
explanatory notes.

     

    

    
      
        
           

          
            	
                  
	
                     

                  	
                     

                  
	
                     

                  	
                     

                  
	
                     

                  	 
      

          

          	
                  Module
      1 – Whole Bank w/ Loss Share – P&A

                	
                  COOPERATIVE
      BANK

                
	
                  Version
      1.05

                	
                  WILMINGTON,
      NORTH CAROLINA

                
	
                  June
      16, 2009

                	 
      

        

        
        

      

      

    

     

    
      77

      
        

      

    

    
       

    

    
    

    Notes
to Exhibit 2b (restructuring)

    

    
      	
               
      

            	
              1.

            	
              The
      data shown are for illustrative purpose.  The figures will vary
      for actual restructurings.

            

    

    
      	
               
      

            	
              2.

            	
              For
      purposes of loss sharing, losses on restructured loans are calculated as
      the difference between:

            

    

    
      	
               
      

            	
              a.

            	
              The
      principal, accrued interest, advances due on the loan, and allowable
      3rd
      party fees prior to restructuring (lines 36-39),
  and

            

    

    
      	
               
      

            	
              b.

            	
              The
      Net Present Value (NPV) of the estimated cash flows (line 43). The cash
      flows should assume no default or prepayment for 10 years, followed by
      prepayment in full at the end of 10 years (120
  months).

            

    

    
      	
               
      

            	
              3.

            	
              For
      owner-occupied residential loans, the NPV is calculated using the most
      recently published Freddie Mac survey rate on 30-year fixed rate loans as
      of the restructure date.

            

    

    
      	
               
      

            	
              4.

            	
              For
      investor owned or non-owner occupied residential loans, the NPV is
      calculated using commercially reasonable rate on 30-year fixed rate loans
      as of the restructure date.

            

    

    
      	
               
      

            	
              5.

            	
              If
      the new loan is an adjustable-rate loan, interest rate resets and related
      cash flows should be projected based on the index rate in effect at the
      date of the loan restructuring.  If the restructured loan
      otherwise provides for specific charges in monthly P&I payments over
      the term of the loan, those changes should be reflected in the projected
      cash flows.  Assuming Bank must retain supporting schedule of
      projected cash flows as required by Section 2.1 of the Single Family
      Shared-Loss Agreement and provide it to the FDIC if requested for a sample
      audit.

            

    

    
      	
               
      

            	
              6.

            	
              Do
      not include late fees, prepayment penalties, or any similar lender fees or
      charges by the Failed Bank or Assuming Bank to the loan account, any
      allocation of Assuming Bank’s servicing costs, or any allocations of
      Assuming Bank’s general and administrative (G&A) or other operating
      costs.

            

    

    
      	
               
      

            	
              7.

            	
              The
      amount of accrued interest that may be added to the balance of the loan is
      limited to the minimum of:

            

    

    
      	
               
      

            	
              a.

            	
              90
      days

            

    

    
      	
               
      

            	
              b.

            	
              The
      number of days that the loan is delinquent at the time of
      restructuring

            

    

    
      	
               
      

            	
              c.

            	
              The
      number of days between the resolution date and the
      restructuring

            

    

    To
calculate accrued interest, apply the note interest rate that would have been in
effect if the loan were performing to the principal balance after application of
the last payment made by the borrower.

    

    
      
        
          

           

          
            	
                  
	
                     

                  	
                     

                  
	
                     

                  	
                     

                  
	
                     

                  	 
      

          

          	
                  Module
      1 – Whole Bank w/ Loss Share – P&A

                	
                  COOPERATIVE
      BANK

                
	
                  Version
      1.05

                	
                  WILMINGTON,
      NORTH CAROLINA

                
	
                  June
      16, 2009

                	 
      

        

        
        

      

      

    

     

    
      78

      
        

      

    

    
       

    

    
    

    Exhibit
2c

    

    This
exhibit contains two versions of the loss share calculation for short sales,
plus explanatory notes.

     

    

      
        
          
            

             

            
              	
                    
	
                       

                    	
                       

                    
	
                       

                    	
                       

                    
	
                       

                    	 
      

            

            	
                    Module
      1 – Whole Bank w/ Loss Share – P&A

                  	
                    COOPERATIVE
      BANK

                  
	
                    Version
      1.05

                  	
                    WILMINGTON,
      NORTH CAROLINA

                  
	
                    June
      16, 2009

                  	 
      

          

          
          

        

        

      

       

    

    
      79

      
        

      

    

    
       

    

    
    

     

    

    
      
        
           

          
            	
                  
	
                     

                  	
                     

                  
	
                     

                  	
                     

                  
	
                     

                  	 
      

          

          	
                  Module
      1 – Whole Bank w/ Loss Share – P&A

                	
                  COOPERATIVE
      BANK

                
	
                  Version
      1.05

                	
                  WILMINGTON,
      NORTH CAROLINA

                
	
                  June
      16, 2009

                	 
      

        

        
        

      

      

    

     

    
      80

      
        

      

    

    
       

    

    
    

     

    Notes
to Exhibit 2c (short sale)

    

    
      	
               
      

            	
              1.

            	
              The
      data shown are for illustrative purpose.  The figures will vary
      for actual short sales.

            

    

    
      	
               
      

            	
              2.

            	
              The
      covered loss is the difference between the gross balance recoverable by
      Purchaser and the total cash recovery.  There are two methods of
      calculation for covered losses from short sales, depending upon the
      circumstances.  They are shown
below:

            

    

    
      	
               
      

            	
              a.

            	
              If
      the loan was restructured when the Loss Share agreement was in place, and
      then the short sale occurred, use Exhibit 2c(2).  This version
      uses the Net Present Value (NPV) of the modified loan as the starting
      point for the covered loss.

            

    

    
      	
               
      

            	
              b.

            	
              Otherwise,
      use Exhibit 2c(1).  This version uses the unpaid balance of the
      loan as of the last payment as the starting point for the covered
      loss.

            

    

    
      	
               
      

            	
              3.

            	
              For
      Exhibit 2c(1), the gross balance recoverable by the purchaser is
      calculated as the sum of lines 12 – 17; it is shown in line 18. For
      Exhibit 2a(2), the gross balance recoverable by the purchaser is
      calculated as line 11 minus line 12 plus lines 13 – 16; it is shown in
      line 17.

            

    

    
      	
               
      

            	
              4.

            	
              For
      Exhibit 2c(1), the total cash recovery is calculated as the sum of lines
      19 – 21; it is shown in line 22. For Exhibit 2c(2), the total cash
      recovery is calculated as the sum of lines 18 – 20; it is shown in line
      21.

            

    

    
      	
               
      

            	
              5.

            	
              Reasonable
      and customary third party attorney’s fees and expenses incurred by or on
      behalf of Assuming Bank in connection with any enforcement procedures, or
      otherwise with respect to such loan, are reported under Attorney’s
      fees.

            

    

    
      	
               
      

            	
              6.

            	
              Do
      not include late fees, prepayment penalties, or any similar lender fees or
      charges by the Failed Bank or Assuming Bank to the loan account, any
      allocation of Assuming Bank’s servicing costs, or any allocations of
      Assuming Bank’s general and administrative (G&A) or other operating
      costs.

            

    

    
      	
               
      

            	
              7.

            	
              If
      Exhibit 2c(2) is used, then no accrued interest may be included as a
      covered loss.  Otherwise, the amount of accrued interest that
      may be included as a covered loss is limited to the minimum
      of:

            

    

    
      	
               
      

            	
              d.

            	
              90
      days

            

    

    
      	
               
      

            	
              e.

            	
              The
      number of days that the loan is delinquent when the property was
      sold

            

    

    
      	
               
      

            	
              f.

            	
              The
      number of days between the resolution date and the date when the property
      was sold

            

    

    To
calculate accrued interest, apply the note interest rate that would have been in
effect if the loan were performing to the principal balance after application of
the last payment made by the borrower.

    

      
        
          
             

            
              	
                    
	
                       

                    	
                       

                    
	
                       

                    	
                       

                    
	
                       

                    	 
      

            

            	
                    Module
      1 – Whole Bank w/ Loss Share – P&A

                  	
                    COOPERATIVE
      BANK

                  
	
                    Version
      1.05

                  	
                    WILMINGTON,
      NORTH CAROLINA

                  
	
                    June
      16, 2009

                  	 
      

          

          
          

        

        

      

       

    

    
      81

      
        

      

    

    
       

    

    
    

    Exhibit
2d

     

    
      	
              Shared-Loss
      Month:

            	 
      	
              [input
      month]

            	 
      
	
              Loan
      no.:

            	 
      	
              [input
      loan no.)

            	 
      
	 
      	 
      	 
      	 
      
	 
      	 
      	 
      	 
      
	
              NOTE

            	 
      	 
      	 
      
	
              The
      calculation of recovery on a loan for which a Restructuring Loss has been
      paid will only apply if the loan is sold.

            
	 
      	 
      	 
      	 
      
	
              EXAMPLE
      CALCULATION

            	 
      	 
      	 
      
	 
      	 
      	 
      	 
      
	
              Restructuring Loss
      Information

            	 
      	 
      	 
      
	
              Loan
      principal balance before restructuring

            	 
      	
              $200,000    
      

            	
              A

            
	
              NPV,
      restructured loan

            	 
      	
                165,000

            	
              B

            
	
              Loss
      on restructured loan

            	 
      	
              $  
      35,000

            	
              A
      – B

            
	
              Times
      FDIC applicable loss share % (80% or 95%)

            	 
      	
                  
      80%

            	 
      
	
              Loss
      share payment to purchaser

            	 
      	
              $  28,000

            	
              C

            
	 
      	 
      	 
      	 
      
	
              Calculation – Recovery
      amount due to Receiver

            	 
      	 
      	 
      
	
              Loan
      sales price

            	 
      	
              $190,000

            	 
      
	
              NPV
      of restructured loan at mod date

            	 
      	
                165,000

            	 
      
	
              Gain
      - step 1

            	 
      	
                 
      25,000

            	
              D

            
	
              PLUS

            	 
      	 
      	 
      
	
              Loan
      UPB after restructuring

            	
              (1)

            	
                   
      200,000

            	 
      
	
              Loan
      UPB at liquidation date

            	 
      	
               
      192,000

            	 
      
	
              Gain
      - step 2 (principal collections after restructuring)

            	 
      	
                 8,000

            	
              E

            
	
              Recovery
      amount

            	 
      	
                  
      33,000

            	
              D
      + E

            
	
              Times
      FDIC loss share %

            	 
      	
                  
      80%

            	 
      
	
              Recovery
      due to FDIC

            	 
      	
              $26,400

            	
              F

            
	 
      	 
      	 
      	 
      
	
              Net
      loss share paid to purchaser (C – F)

            	 
      	
              $  
    1,600

            	 
      
	 
      	 
      	 
      	 
      
	
              Proof
      Calculation

            	
              (2)

            	 
      	 
      
	
              Loan
      principal balance

            	 
      	
              $200,000

            	
              G

            
	 
      	 
      	 
      	 
      
	
              Principal
      collections on loan

            	 
      	
                
    8,000

            	 
      
	
              Sales
      price for loan

            	 
      	
                190,000

            	 
      
	
              Total
      collections on loan

            	 
      	
               
      198,000

            	
              H

            
	
              Net
      loss on loan

            	 
      	
              $   
      2,000

            	
              G
      – H

            
	
              Times
      FDIC applicable loss share % (80% or 95%)

            	 
      	
                  
      80%

            	 
      
	
              Loss
      share payment to purchaser

            	 
      	
              $  
    1,600

            	 
      
	 
      	 
      	 
      	 
      
	 
      	 
      	 
      	 
      
	
              (1)   
      This example assumes that the FDIC loan modification program as shown in
      Exhibit 5 is applied and the loan restructuring does not result in a
      reduction in the loan principal balance due from the
    borrower.

            
	
              (2)  
      This proof calculation is provided to illustrate the concept and the
      Assuming Bank is not required to provide this with its Recovery
      calculations.

            

    

    

      
        
          
             

            
              	
                    
	
                       

                    	
                       

                    
	
                       

                    	
                       

                    
	
                       

                    	 
      

            

            	
                    Module
      1 – Whole Bank w/ Loss Share – P&A

                  	
                    COOPERATIVE
      BANK

                  
	
                    Version
      1.05

                  	
                    WILMINGTON,
      NORTH CAROLINA

                  
	
                    June
      16, 2009

                  	 
      

          

          
          

        

        

      

       

    

    
      82

      
        

      

    

    
       

    

    
    

    

    Exhibit
3

     

    Portfolio
Performance and Summary Schedule

     

    
      	
              SHARED-LOSS
      LOANS

            
	
              PORTFOLIO
      PERFORMANCE AND SUMMARY SCHEDULE

            
	
              MONTH
      ENDED:

            	
              [input
      report month]

            
	 
      	 
      	 
      	 
      	 
      
	 
      	 
      	 
      	 
      	 
      
	
              POOL
      SUMMARY

            	 
      	 
      	 
      	 
      
	 
      	
              #

            	
              $

            	 
      	 
      
	
              Loans
      at Sale Date

            	
              xx

            	
              xx

            	 
      	 
      
	 
      	 
      	 
      	 
      	 
      
	
              Loans
      as of this month-end

            	
              xx

            	
              xx

            	 
      	 
      
	 
      	 
      	 
      	 
      	 
      
	 
      	 
      	 
      	 
      	 
      
	
              STATED THRESHOLD
      TRACKING

            	
              #

            	
              $

            	 
      	 
      
	
              Stated
      Threshold amount

            	 
      	 
      	 
      	
              A

            
	 
      	 
      	 
      	 
      	 
      
	
              Cumulative
      loss payments, prior month

            	 
      	 
      	 
      	 
      
	
              Loss
      payment for current month

            	 
      	 
      	 
      	 
      
	
              Cumulative
      loss payment, this month

            	 
      	 
      	 
      	 
      
	
              Cumulative
      Commercial & Other Loans Net Charge-Offs

            	 
      	 
      	 
      	 
      
	 
      	 
      	 
      	 
      	
              B

            
	
              Remaining
      to Stated Threshold

            	 
      	 
      	 
      	
              A -
      B

            
	 
      	 
      	 
      	 
      	 
      
	 
      	 
      	 
      	 
      	
              Percent
      of Total

            
	
              PORTFOLIO PERFORMANCE
      STATUS

            	
              #

            	
              $

            	 
      	
              #

            
	
              Current

            	 
      	 
      	 
      	 
      
	
              30
      – 59 days past due

            	 
      	 
      	 
      	 
      
	
              60
      – 89 days past due

            	 
      	 
      	 
      	 
      
	
              90
      – 119 days past due

            	 
      	 
      	 
      	 
      
	
              120
      and over days past due

            	 
      	 
      	 
      	 
      
	
              In
      foreclosure

            	 
      	 
      	 
      	 
      
	
              ORE

            	 
      	 
      	 
      	 
      
	
              Total

            	 
      	 
      	 
      	 
      
	 
      	 
      	 
      	 
      	 
      
	
              Memo
      Item:

            	 
      	 
      	 
      	 
      
	
              Loans
      in process of restructuring – total

            	 
      	 
      	 
      	 
      
	
              Loans
      in bankruptcy

            	 
      	 
      	 
      	 
      
	 
      	 
      	 
      	 
      	 
      
	
              Loans in process of
      restructuring by delinquency status

            	 
      	 
      	 
      	 
      
	
              Current

            	 
      	 
      	 
      	 
      
	
              30
      - 59 days past due

            	 
      	 
      	 
      	 
      
	
              60
      - 89 days past due

            	 
      	 
      	 
      	 
      
	
              90
      - 119 days past due

            	 
      	 
      	 
      	 
      
	
              120
      and over days past due In foreclosure

            	 
      	 
      	 
      	 
      
	
              Total

            	 
      	 
      	 
      	 
      
	 
      	 
      	 
      	 
      	 
      

    

    

      
        
          
             

            
              	
                    
	
                       

                    	
                       

                    
	
                       

                    	
                       

                    
	
                       

                    	 
      

            

            	
                    Module
      1 – Whole Bank w/ Loss Share – P&A

                  	
                    COOPERATIVE
      BANK

                  
	
                    Version
      1.05

                  	
                    WILMINGTON,
      NORTH CAROLINA

                  
	
                    June
      16, 2009

                  	 
      

          

          
          

        

        

      

       

    

    
      83

      
        

      

    

    
       

    

    
    

    

    
      	
              List
      of Loans Paid Off During Month

            	 
      	 
      	 
      	 
      
	
              Loan
      #

            	
              Principal
      Balance

            	 
      	 
      	 
      
	 
      	 
      	 
      	 
      	 
      
	
              List
      of Loans Sold During Month

            	 
      	 
      	 
      	 
      
	 
      	 
      	 
      	 
      	 
      
	
              Loan
      #

            	
              Principal
      Balance

            	 
      	 
      	 
      
	 
      	 
      	 
      	 
      	 
      
	 
      	 
      	 
      	 
      	 
      

    

    

    
      
        
          

           

          
            	
                  
	
                     

                  	
                     

                  
	
                     

                  	
                     

                  
	
                     

                  	 
      

          

          	
                  Module
      1 – Whole Bank w/ Loss Share – P&A

                	
                  COOPERATIVE
      BANK

                
	
                  Version
      1.05

                	
                  WILMINGTON,
      NORTH CAROLINA

                
	
                  June
      16, 2009

                	 
      

        

        
        

      

      

    

     

    
      84

      
        

      

    

    
       

    

    
    

    Exhibit
4

     

    Wire
Transfer Instructions

     

    PURCHASER
WIRING INSTRUCTIONS

     

    
      	
              BANK
      RECEIVING WIRE

            	 
      
	 
      	 
      
	
              9
      DIGIT ABA ROUTING NUMBER

            	 
      
	 
      	 
      
	
              ACCOUNT
      NUMBER

            	 
      
	 
      	 
      
	
              NAME
      OF ACCOUNT

            	 
      
	 
      	 
      
	
              ATTENTION
      TO WHOM

            	 
      
	 
      	 
      
	
              PURPOSE
      OF WIRE

            	 
      
	 
      	 
      
	
              FDIC
      RECEIVER WIRING INSTRUCTIONS

            
	 
      	 
      
	
              BANK
      RECEIVING WIRE

            	 
      
	 
      	 
      
	
              SHORT
      NAME

            	 
      
	 
      	 
      
	
              ADDRESS
      OF BANK RECEIVING WIRE

            	 
      
	 
      	 
      
	
              9
      DIGIT ABA ROUTING NUMBER

            	 
      
	 
      	 
      
	
              ACCOUNT
      NUMBER

            	 
      
	 
      	 
      
	
              NAME
      OF ACCOUNT

            	 
      
	 
      	 
      
	
              ATTENTION
      TO WHOM

            	 
      
	 
      	 
      
	
              PURPOSE
      OF WIRE

            	 
      
	 
      	 
      

    

    
      
        
          

           

          
            	
                  
	
                     

                  	
                     

                  
	
                     

                  	
                     

                  
	
                     

                  	 
      

          

          	
                  Module
      1 – Whole Bank w/ Loss Share – P&A

                	
                  COOPERATIVE
      BANK

                
	
                  Version
      1.05

                	
                  WILMINGTON,
      NORTH CAROLINA

                
	
                  June
      16, 2009

                	 
      

        

        
        

      

      

    

     

    
      85

      
        

      

    

    
       

    

    
    

    

     

    EXHIBIT
5

     

    FDIC MORTGAGE LOAN
MODIFICATION PROGRAM

     

    Objective

     

    The
objective of this FDIC Mortgage Loan Modification Program (“Program”) is to
modify the terms of certain residential mortgage loans so as to improve
affordability, increase the probability of performance, allow borrowers to
remain in their homes and increase the value of the loans to the FDIC and
assignees. The Program provides for the modification of Qualifying Loans (as
defined below) by reducing the borrower’s monthly housing debt to income ratio
(“DTI Ratio”) to no more than 31% at the time of the modification and
eliminating adjustable interest rate and negative amortization
features.

     

    Qualifying Mortgage
Loans

     

    In order
for a mortgage loan to be a Qualifying Loan it must meet all of the following
criteria, which must be confirmed by the lender:

     

    
      	
               
      

            	
              ·

            	
              The
      collateral securing the mortgage loan is owner-occupied and the owner’s
      primary residence; and

            

    

    
      	
               
      

            	
              ·

            	
              The
      mortgagor has a first priority lien on the collateral;
  and

            

    

    
      	
               
      

            	
              ·

            	
              Either
      the borrower is at least 60 days delinquent or a default is reasonably
      foreseeable.

            

    

    Modification
Process

     

    The
lender shall undertake a review of its mortgage loan portfolio to identify
Qualifying Loans. For each Qualifying Loan, the lender shall determine the net
present value of the modified loan and, if it will exceed the net present value
of the foreclosed collateral upon disposition, then the Qualifying Loan shall be
modified so as to reduce the borrower’s monthly DTI Ratio to no more than 31% at
the time of the modification. To achieve this, the lender shall use a
combination of interest rate reduction, term extension and principal
forbearance, as necessary.

     

    The
borrower’s monthly DTI Ratio shall be a percentage calculated by dividing the
borrower’s monthly income by the borrower’s monthly housing payment (including
principal, interest, taxes and insurance). For these purposes, (1) the
borrower’s monthly income shall be the amount of the borrower’s (along with any
co-borrowers’) documented and verified gross monthly income, and (2) the
borrower’s monthly housing payment shall be the amount required to pay monthly
principal and interest plus one-twelfth of the then current annual amount
required to pay real property taxes and homeowner’s insurance with respect to
the collateral.

     

    In order
to calculate the monthly principal payment, the lender shall capitalize to the
outstanding principal balance of the Qualifying Loan the amount of all
delinquent interest, delinquent taxes, past due insurance premiums, third party
fees and (without duplication) escrow advances (such amount, the “Capitalized
Balance”).

     

    
      
        
           

          
            	
                    Module
      1 – Whole Bank w/ Loss Share – P&A

                  	 
      	
                    COOPERATIVE
      BANK

                  
	
                    Version
      1.05

                  	 
      	
                    WILMINGTON,
      NORTH CAROLINA

                  
	
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    In order
to achieve the goal of reducing the DTI Ratio to 31%, the lender shall take the
following steps in the following order of priority with respect to each
Qualifying Loan:

     

    
      	
               
      

            	
              1.

            	
              Reduce
      the interest rate to the then current Freddie Mac Survey Rate for 30-year
      fixed rate mortgage loans, and adjust the term to 30
  years.

            

    

     

    
      	
               
      

            	
              2.

            	
              If
      the DTI Ratio is still in excess of 31%, reduce the interest rate further,
      but no lower than 3%, until the DTI ratio of 31% is
    achieved.

            

    

     

    
      	
               
      

            	
              3.

            	
              If
      the DTI Ratio is still in excess of 31% after adjusting the interest rate
      to 3%, extend the remaining term of the loan by 10
  years.

            

    

     

    
      	
               
      

            	
              4.

            	
              If
      the DTI Ratio is still in excess of 31%, calculate a new monthly payment
      (the “Adjusted Payment Amount”) that will result in the borrower’s monthly
      DTI Ratio not exceeding 31%. After calculating the Adjusted Payment
      Amount, the lender shall bifurcate the Capitalized Balance into two
      portions – the amortizing portion and the non-amortizing portion. The
      amortizing portion of the Capitalized Balance shall be the mortgage amount
      that will fully amortize over a 40-year term at an annual interest rate of
      3% and monthly payments equal to the Adjusted Payment Amount. The
      non-amortizing portion of the Capitalized Balance shall be the difference
      between the Capitalized Balance and the amortizing portion of the
      Capitalized Balance. If the amortizing portion of the Capitalized Balance
      is less than 75% of the current estimated value of the collateral, then
      the lender may choose not to restructure the loan.  If the
      lender chooses to restructure the loan, then the lender shall forbear on
      collecting the non-amortizing portion of the Capitalized Balance, and such
      amount shall be due and payable only upon the earlier of (i) maturity of
      the modified loan, (ii) a sale of the property or (iii) a pay-off or
      refinancing of the loan. No interest shall be charged on the
      non-amortizing portion of the Capitalized Balance, but repayment shall be
      secured by a first lien on the
collateral.

            

    

     

    Special
Note:

     

    The net
present value calculation used to determine whether a loan should be modified
based on the modification process above is distinct and different from the net
present value calculation used to determine the covered loss if the loan is
modified.  Please refer only to the net present value calculation
described in this exhibit for the modification process, with its separate
assumptions, when determining whether to provide a modification to a
borrower.  Separate assumptions may include, without limitation,
Assuming Bank’s determination of a probability of default without modification,
a probability of default with modification, home price forecasts, prepayment
speeds, and event timing.  These assumptions are applied to different
projected cash flows over the term of the loan, such as the projected cash flow
of the loan performing or defaulting without modification and the projected cash
flow of the loan performing or defaulting with modification.

     

    By contrast, the net present
value for determining the covered loss is based on a 10 year
period.  While the assumptions in the net present value calculation
used in the modification process may change, the net present value calculation
for determining the covered loss remains constant.

     

    
      
        
           

          
            	
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      1 – Whole Bank w/ Loss Share – P&A

                  	 
      	
                    COOPERATIVE
      BANK

                  
	
                    Version
      1.05

                  	 
      	
                    WILMINGTON,
      NORTH CAROLINA

                  
	
                    June
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    EXHIBIT
4.15B

    

    COMMERCIAL
AND OTHER ASSETS SHARED-LOSS AGREEMENT

    

    This
agreement for reimbursement of loss sharing expenses on certain loans and other
assets (the “Commercial Shared-Loss Agreement”) shall apply when the Assuming
Bank purchases Shared-Loss Assets as that term is defined herein.  The
terms hereof shall modify and supplement, as necessary, the terms of the
Purchase and Assumption Agreement to which this Commercial Shared-Loss Agreement
is attached as Exhibit 4.15B and incorporated therein. To the extent any
inconsistencies may arise between the terms of the Purchase and Assumption
Agreement and this Commercial Shared-Loss Agreement with respect to the subject
matter of this Commercial Shared-Loss Agreement, the terms of this Commercial
Shared-Loss Agreement shall control.  References in this Commercial
Shared-Loss Agreement to a particular Section shall be deemed to refer to a
Section in this Commercial Shared-Loss Agreement unless the context indicates
that a Section of the Purchase and Assumption Agreement is
intended.

    

    ARTICLE
I -- DEFINITIONS

    

    Capitalized
terms used in this Commercial Shared-Loss Agreement that are not defined in this
Commercial Shared-Loss Agreement are defined in the Purchase and Assumption
Agreement  In addition to the terms defined above, defined below are
certain additional terms relating to loss-sharing, as used in this Commercial
Shared-Loss Agreement.

    

    “AAA” means the American
Arbitration Association as provided in Section 2.1(f)(iii) of this Commercial
Shared-Loss Agreement.

    

    “Accrued
Interest” means,
with respect to any Shared-Loss Loan, Permitted Advance or Shared-Loss Loan
Commitment Advance at any time, the amount of earned and unpaid interest, taxes,
credit life and/or disability insurance premiums (if any) payable by the Obligor
accrued on or with respect to such Shared-Loss Loan, Permitted Advance or
Shared-Loss Loan Commitment Advance, all as reflected on the Accounting Records
of the Failed Bank or the Assuming Bank (as applicable); provided, that Accrued Interest
shall not include any amount that accrues on or with respect to any Shared-Loss
Loan, Permitted Advance or Shared-Loss Loan Commitment Advance after that Asset
has been placed on non-accrual or nonperforming status by either the Failed Bank
or the Assuming Bank (as applicable).

    

    “Additional
ORE” means
Shared-Loss Loans that become Other Real Estate after Bank Closing
Date.

    

    “Affiliate” shall have the meaning set
forth in the Purchase and Assumption Agreement; provided, that, for purposes of
this Commercial Shared-Loss Agreement, no Third Party Servicer shall be deemed
to be an Affiliate of the Assuming Bank.

    

    “Applicable
Anniversary of the Commencement Date” means the fifth (5th)

    anniversary
of the Commencement Date.

    
      
        
           

          
            	
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      1 – Whole Bank w/ Loss Share – P&A

                  	 
      	
                    COOPERATIVE
      BANK

                  
	
                    Version
      1.05

                  	 
      	
                    WILMINGTON,
      NORTH CAROLINA

                  
	
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    “Calendar
Quarter” means a
quarterly period (a) for the first such period, beginning on the Commencement
Date and ending on the last calendar day of either March, June, September or
December, whichever is the first to occur after the Commencement Date, and (b)
for quarterly periods thereafter, beginning on the first calendar day of the
calendar month immediately after the month that ended the prior period and
ending on the last calendar day of each successive three-calendar-month period
thereafter (i.e., each March, June, September and December, starting in the
applicable order depending on the ending date of first such period) of any
year.

    

    “Capitalized
Expenditures”
means those expenditures that (i) would be capitalized under generally
accepted accounting principles, and (ii) are incurred with respect to
Shared-Loss Loans, Other Real Estate, Additional ORE or Subsidiary ORE.
Capitalized Expenditures shall not include expenses related to environmental
conditions including, but not limited to, remediation, storage or disposal of
any hazardous or toxic substances or any pollutant or contaminant.

    

    “Charge-Offs” means, with respect to any
Shared-Loss Assets for any period, an amount equal to the aggregate amount of
loans or portions of loans classified as “Loss” under the Examination Criteria,
including (a) charge-offs of (i) the principal amount of such assets net of
unearned interest (including write-downs associated with Other Real Estate,
Additional ORE, Subsidiary ORE or loan modification(s)) (ii) Accrued Interest,
and (iii) Capitalized Expenditures plus (b) Pre-Charge-Off Expenses incurred on
the respective Shared-Loss Loans, all as effected by the Assuming Bank during
such period and reflected on the Accounting Records of the Assuming Bank; provided, that: (i) the
aggregate amount of Accrued Interest (including any reversals thereof) for the
period after Bank Closing that shall be included in determining the amount of
Charge-Offs for any Shared-Loss Loan shall not exceed ninety (90) days’ Accrued
Interest; (ii) no Charge-Off shall be taken with respect to any anticipated
expenditure by the Assuming Bank until such expenditure is actually incurred;
(iii) any financial statement adjustments made in connection with the purchase
of any Assets pursuant to this Purchase and Assumption Agreement or any future
purchase, merger, consolidation or other acquisition of the Assuming Bank shall
not constitute “Charge-Offs”; and (iv) except for Portfolio Sales or any other
sales or dispositions consented to by the Receiver, losses incurred on the sale
or other disposition of Shared-Loss Assets to any Person (other than the sale or
other disposition of Other Real Estate, Additional ORE or Subsidiary ORE to a
Person other than an Affiliate of the Assuming Bank which is conducted in a
commercially reasonable and prudent manner) shall not constitute
Charge-Offs.

    

    “Commencement
Date” means the
first calendar day following Bank Closing.

    

    “Consumer
Loans” means
Loans to individuals for household, family and other personal expenditures
(including United States and/or State-guaranteed student loans and extensions of
credit pursuant to a credit card plan or debit card plan).

    

    “Environmental
Assessment” means
an assessment of the presence, storage or release of any hazardous or toxic
substance, pollutant or contaminant with respect to the collateral securing a
Shared-Loss Loan that has been fully or partially charged off.

    
      
        
           

          
            	
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      1 – Whole Bank w/ Loss Share – P&A

                  	 
      	
                    COOPERATIVE
      BANK

                  
	
                    Version
      1.05

                  	 
      	
                    WILMINGTON,
      NORTH CAROLINA

                  
	
                    June
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    “Examination
Criteria” means
the loan classification criteria employed by, or any applicable regulations of,
the Assuming Bank’s Chartering Authority at the time such action is taken, as
such criteria may be amended from time to time.

    

    “Failed
Bank Charge-Offs/Write-Downs” means, with respect to any
Shared-Loss Asset, an amount equal to the aggregate amount of reversals or
charge-offs of Accrued Interest and charge-offs and write-downs of principal
effected by the Failed Bank with respect to that Shared-Loss Asset as reflected
on the Accounting Records of the Failed Bank.

    

    “Fair
Value” means the
fair value of a Shared Loss MTM Asset as determined in accordance with FAS 157
as in effect on Bank Closing.

    

    “FDIC
Party” has the
meaning provided in Section 2.1(f)(ii) of this Commercial Shared-Loss
Agreement.

    

     “Net
Charge-Offs”
means, with respect to any period, an amount equal to the aggregate amount of
Charge-Offs for such period less the amount of Recoveries for such
period.

    

    “Neutral
Member” has the
meaning provided in Section 2.1(f)(ii) of this Commercial Shared-Loss
Agreement.

    

    “New
Shared-Loss Loans” means loans that would
otherwise be subject to loss sharing under this Commercial Shared-Loss
Agreement that were originated after
the Information Package Date and before Bank Closing.

    

    “Notice of
Dispute” has the
meaning provided in Section 2.1(f)(iii) of this Commercial Shared-Loss
Agreement.

    

    “ORE
Subsidiary” means
any Subsidiary of the Assuming Bank that engages solely in holding, servicing,
managing or liquidating interests of a type described in clause (A) of the
definition of “Other Real Estate,” which interests have arisen from the
collection or settlement of a Shared-Loss Loan.

    

    “Other
Real Estate”
means all of the following (including any of the following fully or partially
charged off the books and records of the Failed Bank or the Assuming Bank) that
(i) are owned by the Failed Bank as of Bank Closing and are purchased pursuant
to the  Purchase and Assumption Agreement or (ii) have arisen
subsequent to Bank Closing from the collection or settlement by the Assuming
Bank of a Shared-Loss Loan:

    

    (A)           all
interests in real estate (other than Bank Premises and Fixtures), including but
not limited to min­eral rights, lease­­­hold rights, condominium
and cooperative interests, air rights and development rights;
and

    
      
        
           

          
            	
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      1 – Whole Bank w/ Loss Share – P&A

                  	 
      	
                    COOPERATIVE
      BANK

                  
	
                    Version
      1.05

                  	 
      	
                    WILMINGTON,
      NORTH CAROLINA

                  
	
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    (B)           all
other assets (whether real or personal property) acquired by foreclosure or in
full or partial satisfaction of judgments or indebtedness.

    

    “Permitted
Advance” means an
advance of funds by the Assuming Bank with respect to a Shared-Loss Loan, or the
making of a legally binding commitment by the Assuming Bank to advance funds
with respect to a Shared-Loss Loan, that (i) in the case of such an advance, is
actually made, and, in the case of such a commitment, is made and all of the
proceeds thereof actually advanced, within one (1) year after the Commencement
Date, (ii) does not cause the sum of (A) the book value of such Shared-Loss Loan
as reflected on the Accounting Records of the Assuming Bank after any such
advance has been made by the Assuming Bank plus (B) the unfunded
amount of any such commitment made by the Assuming Bank related thereto, to
exceed 110% of the Book Value of such Shared-Loss Loan, (iii) is not made with
respect to a Shared-Loss Loan with respect to which (A) there exists a related
Shared-Loss Loan Commitment or (B) the Assuming Bank has taken a Charge-Off and
(iv) is made in good faith, is supported at the time it is made by documentation
in the Credit Files and conforms to and is in accordance with the applicable
requirements set forth in Article III of this Commercial Shared-Loss Agreement
and with the then effective written internal credit policy guidelines of the
Assuming Bank; provided, that the limitations
in subparagraphs (i), (ii) and (iii) of this definition shall not apply to any
such action (other than to an advance or commitment related to the remediation,
storage or final disposal of any hazardous or toxic substance, pollutant or
contaminant) that is taken by Assuming Bank in its reasonable discretion to
preserve or secure the value of the collateral for such Shared-Loss
Loan.

    

    “Permitted
Amendment” means,
with respect to any Shared-Loss Loan Commitment or Shared-Loss Loan, any
amendment, modification, renewal or extension thereof, or any waiver of any
term, right, or remedy thereunder, made by the Assuming Bank in good faith and
otherwise in accordance with the applicable requirements set forth in Article
III of this Commercial Shared-Loss Agreement and the then effective written
internal credit policy guidelines of the Assuming Bank; provided, that:

    

    (i) with
respect to a Shared-Loss Loan Commitment or a Shared-Loss Loan that is not a
revolving line of credit, no such amendment, modification, renewal, extension,
or waiver, except as allowed under the definition of Permitted Advance, shall
operate to increase the amount of principal (A) then remaining available to be
advanced by the Assuming Bank under the Shared-Loss Loan Commitment or (B) then
outstanding under the Shared-Loss Loan;

    

    (ii) with
respect to a Shared-Loss Loan Commitment or a Shared-Loss Loan that is a
revolving line of credit, no such amendment, modification, renewal, extension,
or waiver, except as allowed under the definition of Permitted Advance, shall
operate to increase the maximum amount of principal authorized as of Bank
Closing to be outstanding at any one time under the underlying revolving line of
credit relationship with the debtor (regardless of the extent to which such
revolving line of credit may have been funded as of Bank Closing or may
subsequently have been funded and/or repaid); and

    

    (iii) no
such amendment, modification, renewal, extension or waiver shall extend the term
of such Shared-Loss Loan Commitment or Shared-Loss Loan beyond the end of the
final Shared-Loss Quarter unless the term of such Shared-Loss Loan Commitment or
Shared-Loss

    
      
        
           

          
            	
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      1 – Whole Bank w/ Loss Share – P&A

                  	 
      	
                    COOPERATIVE
      BANK

                  
	
                    Version
      1.05

                  	 
      	
                    WILMINGTON,
      NORTH CAROLINA

                  
	
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    Loan as
existed on Bank Closing was beyond the end of the final Shared-Loss Quarter, in
which event no such amendment, modification, renewal, extension or waiver shall
extend such term beyond the term as existed as of Bank Closing.

    

    “Pre-Charge-Off
Expenses” means
those expenses incurred in the usual and prudent management of  a
Shared-Loss Loan that would qualify as a Reimbursable Expense or Recovery
Expense if incurred after a Charge-Off of the related Shared-Loss Asset had
occurred.

    

    “Quarterly
Certificate” has
the meaning provided in Section 2.1(a)(i) of this Commercial Shared-Loss
Agreement.

    

    “Recoveries” (I)(A) In addition to any
sums to be applied as Recoveries pursuant to subparagraph (II) below,
“Recoveries” means, with respect to any period, the sum of (without
duplication):

    

    (i) the
amount of collections during such period by the Assuming Bank on Charge-Offs of
Shared-Loss Assets effected by the Assuming Bank prior to the end of the final
Shared-Loss Quarter; plus

    

    (ii) the
amount of collections during such period by the Assuming Bank on Failed Bank
Charge-Offs/Write-Downs; plus

    

    (iii) the
amount of gain on any sale or other disposition during such period by the
Assuming Bank of Shared Loss Loans, Other Real Estate, Additional ORE or
Subsidiary ORE (provided, that the amount of
any such gain included in Recoveries shall not exceed the aggregate amount of
the related Failed Bank Charge-Offs/Write-Downs and Charge-Offs taken and any
related Reimbursable Expenses and Recovery Expenses); plus

    

    (iv) the
amount of collections during such period by the Assuming Bank of any
Reimbursable Expenses or Recovery Expenses; plus

    

    (v) the
amount of any fee or other consideration received by the Assuming Bank during or
prior to such period in connection with any amendment, modification, renewal,
extension, refinance, restructure, commitment or other similar action taken by
the Assuming Bank with respect to a Shared-Loss Asset with respect to which
there exists a Failed Bank Charge-Off/Write-Down or a Shared-Loss Loan as to
which a Charge-Off has been effected by the Assuming Bank during or prior to
such period (provided, that the amount of
any such fee or other consideration included in Recoveries shall not exceed the
aggregate amount of the related Failed Bank Charge-Offs/Write-Downs and
Charge-Offs taken and any related Reimbursable Expenses and Recovery
Expenses).

    

    (I)(B)
For the purpose of determining the amounts to be applied as Recoveries pursuant
to subparagraph (I)(A) above, the Assuming Bank shall apply amounts received on
the Assets that are not otherwise applied to reduce the book value of principal
of a Shared-Loss Loan (or, in the case of Other Real Estate, Additional ORE,
Subsidiary ORE and Capitalized Expenditures, that are not otherwise applied to
reduce the book value thereof) in the following order: first to

    
      
        
           

          
            	
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      1 – Whole Bank w/ Loss Share – P&A

                  	 
      	
                    COOPERATIVE
      BANK

                  
	
                    Version
      1.05

                  	 
      	
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      NORTH CAROLINA

                  
	
                    June
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    Charge-Offs
and Failed Bank Charge-Offs/Write Downs; then to Reimbursable Expenses and
Recovery Expenses; then to interest income; and then to other expenses incurred
by the Assuming Bank.

    

    (II)
If there occurs
an amendment, modification, renewal, extension, refinance, restructure,
commitment, sale or other similar action with respect to a Shared-Loss Loan as
to which there exists a Failed Bank Charge-Off/Write Down or as to which a
Charge-Off has been effected by the Assuming Bank during or prior to such
period, and
if, as a result
of such occurrence, the Assuming Bank recognizes any interest income for
financial accounting purposes on that Shared-Loss Loan, then “Recoveries”
shall also include the portion of the total amount of any such interest income
recognized by the Assuming Bank which is derived by multiplying:

    

    (A) the
total amount of any such interest income recognized by the Assuming Bank during
such period with respect to that Shared-Loss Loan as described above, by

    

    (B) a
fraction, the numerator of which is
the aggregate principal amount (excluding reversals or charge-offs of Accrued
Interest) of all such Failed Bank Charge-Offs/Write-Downs and Charge-Offs
effected by the Assuming Bank with respect to that Shared-Loss Loan plus the
principal amount of that Shared-Loss Loan that has not yet been charged-off but
has been placed on nonaccrual status, all of which occurred at any time prior to
or during the period in which the interest income referred to in subparagraph
(II)(A) immediately above was recognized, and the denominator of which
is the total amount of principal indebtedness (including all such prior Failed
Bank Charge-Offs/Write-Downs and Charge-Offs as described above) due from the
Obligor on that Shared-Loss Loan as of the end of such period;

    

    provided, however, that the amount of
any interest income included as Recoveries for a particular Shared-Loss Loan
shall not exceed the aggregate amount of (a) Failed Bank
Charge-Offs/Write-Downs, (b) Charge-Offs effected by the Assuming Bank during or
prior to the period in which the amount of Recoveries is being determined, plus
(c) any Reimbursable Expenses and Recovery Expenses paid to the Assuming Bank
pursuant to this Commercial Shared-Loss Agreement during or prior to the period
in which the amount of Recoveries is being determined, all with respect to that
particular Shared-Loss Loan; and, provided, further, that any collections
on any such Shared-Loss Loan that are not applied to reduce
book value of principal or recognized as interest income shall be applied
pursuant to subparagraph (I) above.

    

    (III)
Notwithstanding subparagraphs (I) and (II) above, the term “Recoveries” shall
not include: (a) any amounts paid to the Assuming Bank by the Receiver pursuant
to Section 2.1 of this Commercial Shared-Loss Agreement, (b) amounts received
with respect to Charge-Offs effected by the Assuming Bank after the final
Shared-Loss Quarter, (c) after the final Shared-Loss Quarter, income received by
the Assuming Bank from the operation of, and any gains recognized by the
Assuming Bank on the disposition of, Other Real Estate, Additional ORE or
Subsidiary ORE (such income and gains being hereinafter together referred to as
“ORE Income”), except to the extent
that aggregate ORE Income exceeds the aggregate expenses paid to third parties
by or on behalf of the Assuming Bank after the final Shared-Loss Quarter to
manage, operate and maintain Other Real Estate, Additional ORE or Subsidiary ORE
(such

    
      
        
           

          
            	
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      1 – Whole Bank w/ Loss Share – P&A

                  	 
      	
                    COOPERATIVE
      BANK

                  
	
                    Version
      1.05

                  	 
      	
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      NORTH CAROLINA

                  
	
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    expenses
being hereinafter referred to as “ORE Expenses”). In determining the extent
aggregate ORE Income exceeds aggregate ORE Expenses for any Recovery Quarter as
set forth immediately above in subparagraph (c), the Assuming Bank will subtract
(i) ORE Expenses paid to third parties during such Recovery Quarter (provided,
that, in the case of the final Recovery Quarter only, the Assuming Bank will
subtract ORE Expenses paid to third parties from the beginning of the final
Recovery Quarter up to the date the Assuming Bank is required to deliver the
final Quarterly Certificate pursuant to this Commercial Shared-Loss Agreement)
from (ii) ORE
Income received during such Recovery Quarter, to calculate net ORE income (“Net
ORE Income”) for that Recovery Quarter. If the amount of Net ORE Income so
calculated for a Recovery Quarter is positive, such amount shall be reported as
Recoveries on the Quarterly Certificate for such Recovery Quarter. If the amount
of Net ORE Income so calculated for a Recovery Quarter is negative (“Net ORE
Loss Carryforward”), such amount shall be added to any ORE Expenses paid to
third parties in the next succeeding Recovery Quarter, which sum shall then be
subtracted from ORE Income for that next succeeding Recovery Quarter, for the
purpose of determining the amount of Net ORE Income (or, if applicable, Net ORE
Loss Carryforward) for that next succeeding Recovery Quarter. If, as of the end
of the final Recovery Quarter, a Net ORE Loss Carryforward exists, then the
amount of the Net ORE Loss Carryforward that does not exceed the
aggregate amount of Net ORE Income reported as Recoveries on Quarterly
Certificates for all Recovery Quarters
may be included as a Recovery Expense on the Quarterly Certificate for the final
Recovery Quarter.

    

    “Recovery
Amount” has the
meaning provided in Section 2.1(b)(ii) of this Commercial Shared-Loss
Agreement.

    

    “Recovery
Expenses” means,
for any Recovery Quarter, the amount of actual, reasonable and necessary
out-of-pocket expenses (other than Capitalized Expenditures) paid to third
parties (other than Affiliates of the Assuming Bank) by or on behalf of the
Assuming Bank, as limited by Sections 3.2(c) and (d) of Article III to this
Commercial Shared-Loss Agreement, to recover amounts owed with respect to (i)
any Shared-Loss Asset as to which a Charge-Off was effected prior to the end of
the final Shared-Loss Quarter (provided that such amounts were incurred no
earlier than the date the first Charge-Off on such Shared-Loss Asset could have
been reflected on the Accounting Records of the Assuming Bank), and (ii) Failed
Bank Charge-Offs/Write-Downs (including, in each case, all costs and expenses
related to an Environmental Assessment and any other costs or expenses related
to any environmental conditions with respect to the Shared-Loss Assets (it being
understood that any remediation expenses for any such pollutant or contaminant
are not recoverable if in excess of $200,000 per Shared-Loss Asset, without the
Assuming Bank having obtained the prior consent of the Receiver for such
expenses); provided, that, so long as
income with respect to a Shared-Loss Loan is being prorated pursuant to the
arithmetical formula in subsection (II) of the definition of “Recoveries”, the
term “Recovery Expenses” shall not include that
portion of any such expenses paid during such Recovery Quarter to recover any
amounts owed on that Shared-Loss Loan that is derived by:

    

    subtracting (1) the
product derived by multiplying:

    

    (A) the
total amount of any such expenses paid by or on behalf of the Assuming Bank
during such Recovery Quarter with respect to that Shared-Loss Loan, by

    
      
        
           

          
            	
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      1 – Whole Bank w/ Loss Share – P&A

                  	 
      	
                    COOPERATIVE
      BANK

                  
	
                    Version
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      NORTH CAROLINA

                  
	
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    (B) a
fraction, the numerator of which is
the aggregate principal amount (excluding reversals or charge-offs of Accrued
Interest) of all such Failed Bank Charge-Offs/Write-Downs and Charge-Offs
effected by the Assuming Bank with respect to that Shared-Loss Loan plus the
principal amount of that Shared-Loss Loan that has not yet been charged-off but
has been placed on nonaccrual status, all of which occurred at any time prior to
or during the period in which the interest income referred to in subparagraph
(II)(A) of the definition of “Recoveries” was recognized, and the denominator of which
is the total amount of principal indebtedness (including all such prior Failed
Bank Charge-Offs/Write-Downs and Charge-Offs as described above) due from the
Obligor on that Shared-Loss Loan as of the end of such period;

    

    from (2) the total
amount of any such expenses paid during that Recovery Quarter with respect to
that Shared-Loss Loan.

    

    “Recovery
Quarter” has the
meaning provided in Section 2.1(a)(ii) of this Commercial Shared-Loss
Agreement.

    

    “Reimbursable
Expenses” means,
for any Shared-Loss Quarter, the amount of actual, reasonable and necessary
out-of-pocket expenses (other than Capitalized Expenditures), paid to third
parties (other than Affiliates of the Assuming Bank) by or on behalf of the
Assuming Bank, as limited by Sections 3.2(c) and (d) of Article III of this
Commercial Shared-Loss Agreement, to:

    

    (i)
recover amounts owed with respect to any Shared-Loss Asset as to which a
Charge-Off has been effected prior to the end of the final Shared-Loss Quarter
(provided that such amounts were incurred no earlier than the date the first
Charge-Off on such Shared-Loss Asset could have been reflected on the Accounting
Records of the Assuming Bank) and recover amounts owed with respect to Failed
Bank Charge-Offs/Write-Downs (including, in each case, all costs and expenses
related to an Environmental Assessment and any other costs or expenses related
to any environmental conditions with respect to the Shared-Loss Assets (it being
understood that any such remediation expenses for any such pollutant or
contaminant are not recoverable if in excess of $200,000 per Shared-Loss Asset,
without the Assuming Bank having obtained the prior consent of the Receiver for
such expenses); provided, that, so long as
income with respect to a Shared-Loss Loan is being pro-rated pursuant to the
arithmetical formula in subsection (II) of the definition of “Recoveries”, the
term “Reimbursable Expenses” shall not include that
portion of any such expenses paid during such Shared-Loss Quarter to recover any
amounts owed on that Shared-Loss Loan that is derived by:

    

    subtracting (1) the
product derived by multiplying:

    

    (A) the
total amount of any such expenses paid by or on behalf of the Assuming Bank
during such Shared-Loss Quarter with respect to that Shared-Loss Loan, by

    
      
        
           

          
            	
                    Module
      1 – Whole Bank w/ Loss Share – P&A

                  	 
      	
                    COOPERATIVE
      BANK

                  
	
                    Version
      1.05

                  	 
      	
                    WILMINGTON,
      NORTH CAROLINA

                  
	
                    June
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    (B) a
fraction, the numerator of which is
the aggregate principal amount (excluding reversals or charge-offs of Accrued
Interest) of all such Failed Bank Charge-Offs/Write-Downs and Charge-Offs
effected by the Assuming Bank with respect to that Shared-Loss Loan plus the
principal amount of that Shared-Loss Loan that has not yet been charged-off but
has been placed on nonaccrual status, all of which occurred at any time prior to
or during the period in which the interest income referred to in subparagraph
(II)(A) of the definition of “Recoveries” was recognized, and the denominator of which
is the total amount of principal indebtedness (including all such prior Failed
Bank Charge-Offs/Write-Downs and Charge-Offs as described above) due from the
Obligor on that Shared-Loss Loan as of the end of such period;

    

    from (2) the total
amount of any such expenses paid during that Shared-Loss Quarter with respect to
that Shared-Loss Loan; and

    

    (ii) manage, operate or maintain Other
Real Estate, Additional ORE or Subsidiary ORE less the amount of
any income received by the Assuming Bank during such Shared-Loss Quarter with
respect to such Other Real Estate, Additional ORE or Subsidiary ORE (which
resulting amount under this clause (ii) may be negative).

    

    “Review
Board” has the
meaning provided in Section 2.1(f)(i) of this Commercial Shared-Loss
Agreement.

    

    “Shared-Loss
Amount” has the
meaning provided in Section 2.1(b)(i) of this Commercial Shared-Loss
Agreement.

    

    “Shared-Loss
Asset Repurchase Price” means, with respect to any
Shared-Loss Asset, the principal amount thereof plus any other fees or penalties
due from an Obligor (including, subject to the limitations discussed below, the
amount of any Accrued Interest) stated on the Accounting Records of the Assuming
Bank, as of the date as of which the Shared-Loss Asset Repur­chase Price is
being determined (regardless, in the case of a Shared-Loss Loan, of the Legal
Balance thereof) plus all Reimbursable Expenses and Recovery Expenses incurred
up to and through the date of consummation of purchase of such Shared-Loss
Asset; provided, that (i) in the
case of a Shared-Loss Loan there shall be excluded from such amount the amount
of any Accrued Interest accrued on or with respect to such Shared-Loss Loan
prior to the ninety (90)-day period ending on the day prior to the purchase date
determined pursuant to Sections 2.1(e)(i) or 2.1(e)(iii) of this Commercial
Shared-Loss Agreement, except to the extent such Accrued Interest was included
in the Book Value of such Shared-Loss Loan, and (ii) any collections on a
Shared-Loss Loan received by the Assuming Bank after the purchase date
applicable to such Shared-Loss Loan shall be applied (without duplication) to
reduce the Shared-Loss Asset Repurchase Price of such Shared-Loss Loan on a
dollar-for-dollar basis. For purposes of determining the amount of unpaid
interest which accrued during a given period with respect to a variable-rate
Shared-Loss Loan, all collections of interest shall be deemed to be applied to
unpaid interest in the chronological order in which such interest
accrued.

    
      
        
           

          
            	
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      1 – Whole Bank w/ Loss Share – P&A

                  	 
      	
                    COOPERATIVE
      BANK

                  
	
                    Version
      1.05

                  	 
      	
                    WILMINGTON,
      NORTH CAROLINA

                  
	
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    “Shared-Loss
Assets” means
Shared-Loss Loans, Other Real Estate purchased by the Assuming Bank, Additional
ORE, Subsidiary ORE and Capitalized Expenditures, but does not include Shared
Loss MTM Assets.

    

    “Shared-Loss
Loan Commitment”
means:

    

    (i) any
Commitment to make a further extension of credit or to make a further advance
with respect to an existing Shared-Loss Loan; and

    

    (ii) any
Shared-Loss Loan Commitment (described in subparagraph (i) immediately
preceding) with respect to which the Assuming Bank has made a Permitted
Amendment.

    

    “Shared-Loss
Loan Commitment Advance” means an advance pursuant to
a Shared-Loss Loan Commitment with respect to which the Assuming Bank has not made a Permitted
Advance.

    

    “Shared-Loss
Loans”
means:

    

    (i)(A) Loans purchased by the Assuming
Bank pursuant to the Purchase and Assumption Agreement set forth on Exhibit
4.15(b) to the Purchase and Assumption Agreement, (B) New Shared-Loss Loans
purchased by the Assuming Bank pursuant to the Purchase and Assumption
Agreement, (C) Permitted Advances and (D) Shared-Loss Loan Commitment Advances,
if any; provided, that Shared-Loss
Loans shall not include Loans, New Shared-Loss Loans, Permitted Advances and
Shared-Loss Loan Commitment Advances with respect to which an Acquired
Subsidiary, or a constituent Subsidiary thereof, is an Obligor; (E) Loans owned
by any Subsidiary which are not Shared-Loss Loans under the Single Family
Shared-Loss Agreement; and (F) Consumer Loans; and

    

    (ii) any
Shared-Loss Loans (described in subparagraph (i) immediately preceding) with
respect to which the Assuming Bank has made a Permitted Amendment.

    

    “Shared-Loss
MTM Assets” means
those securities and other assets listed on Exhibit 4.15(C).

    

    “Shared-Loss
Payment Trigger”
means when the sum of the Cumulative Loss Amount under the Single Family
Shared-Loss Agreement and the cumulative Net Charge-Offs under this Commercial
Shared-Loss Agreement, exceeds the First Loss Tranche.  If the First
Loss Tranche is zero or a negative number, the Shared-Loss Payment Trigger shall
be deemed to have been reached upon Bank Closing.

    

    “Shared-Loss
Quarter” has the
meaning provided in Section 2.1(a)(i) of this Commercial Shared-Loss
Agreement.

    

    “Stated
Threshold” means
total losses under the shared loss agreements in the amount of
$303,000,000.00.

    
      
        
           

          
            	
                    Module
      1 – Whole Bank w/ Loss Share – P&A

                  	 
      	
                    COOPERATIVE
      BANK

                  
	
                    Version
      1.05

                  	 
      	
                    WILMINGTON,
      NORTH CAROLINA

                  
	
                    June
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    “Subsidiary
ORE” means all
assets owned by ORE Subsidiaries that would constitute Additional ORE if such
assets were on the books of the Assuming Bank.

    

    “Termination
Date” means the
eighth (8th) anniversary of the
Commencement Date.

    

    “Third-Party
Servicer” means
any servicer appointed from time to time by the Assuming Bank or any Affiliate
of the Assuming Bank to service the Shared-Loss Assets on behalf of the Assuming
bank, the identity of which shall be given to the Receiver prior to or
concurrent with the appointment thereof.

    

    ARTICLE II -- SHARED-LOSS
ARRANGEMENT

    

    2.1           Shared-Loss
Arrangement.

    

    (a)           Quarterly
Certificates. (i)
Not later than thirty (30) days after the end of each Calendar Quarter from and
including the initial Calendar Quarter to and including the Calendar Quarter in
which the Applicable Anniversary of the Commencement Date falls (each of such
Calendar Quarters being referred to herein as a “Shared-Loss Quarter”), the
Assuming Bank shall deliver to the Receiver a certificate, signed by the
Assuming Bank’s chief executive officer and its chief financial officer, setting
forth in such form and detail as the Receiver may specify (a “Quarterly
Certificate”):

    

    (A)           the
amount of Charge-Offs, the amount of Recoveries and the amount of Net
Charge-Offs (which amount may be negative) during such Shared-Loss Quarter with
respect to the Shared-Loss Assets (and for Recoveries, with respect to the
Assets for which a charge-off was effected by the Failed Bank prior to Bank
Closing); and

    

    (B)           the
aggregate amount of Reimbursable Expenses (which amount may be negative) during
such Shared-Loss Quarter; and

    

    (C)           net
realized loss on the Shared Loss MTM Assets determined pursuant to FAS 115,
expressed as a positive number (MTM Net Realized Loss), or net realized gain on
the Shared Loss MTM assets, expressed as a negative number (MTM Net Realized
Gain); and

    

    (D)           any
other than temporary impairment of the Shared Loss MTM Assets, determined
pursuant to FAS 115, expressed as a positive number (“OTTI Loss”) or reversals
of OTTI Loss, expressed as a negative number (for the avoidance of doubt, normal
and customary unrealized mark-to-market changes by reason of the application of
fair value accounting do not qualify for loss sharing payments).

    

    
      
        
           

          
            	
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      1 – Whole Bank w/ Loss Share – P&A

                  	 
      	
                    COOPERATIVE
      BANK

                  
	
                    Version
      1.05

                  	 
      	
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      NORTH CAROLINA

                  
	
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    (ii)           Not
later than thirty (30) days after the end of each Calendar Quarter from and
including the first Calendar Quarter following the final Shared-Loss Quarter to
and including the Calendar Quarter in which the Termination Date falls (each of
such Calendar Quarters being referred to herein as a “Recovery Quarter”), the
Assuming Bank shall deliver to the Receiver a Quarterly Certificate setting
forth, in such form and detail as the Receiver may specify

    

    (A)           the
amount of Recoveries and Recovery Expenses during such Recovery Quarter. On the
Quarterly Certificate for the first Recovery Quarter
only, the Assuming Bank may report as a separate item, in such form and
detail as the Receiver may specify, the aggregate amount of any Reimbursable
Expenses that: (a) were incurred prior to or during the final Shared-Loss
Quarter, and
(b) had not
been included in any Quarterly Certificate for any Shared-Loss Quarter because
they had not been actually paid by or on behalf of the Assuming Bank (in
accordance with the terms of this Commercial Shared-Loss Agreement) during any
Shared-Loss Quarter and (c) were actually
paid by or on behalf of the Assuming Bank (in accordance with the terms of this
Commercial Shared-Loss Agreement) during the first Recovery Quarter;
and

    

    (B)           net
realized gain on the Shared Loss MTM Assets.

    

    (b)           Payments With Respect to
Shared-Loss Assets.

    

    (i)           For
purposes of this Section 2.1(b), the Assuming Bank shall initially record the
Shared-Loss Assets on its Accounting Records at Book Value, and initially record
the Shared Loss MTM Assets on its Accounting Records at Fair Value, and adjust
such amounts as such values may change after the Bank Closing. If the amount of
all Net Charge-Offs during any Shared-Loss Quarter plus Reimbursable
Expenses, plus  MTM
Net Realized Gain or MTM Net Realized Loss, plus OTTI Loss during
such Shared-Loss Quarter (the “Shared-Loss Amount”) is positive, then, except as
provided in Sections 2.1(c) and (e) below, and subject to the provisions of
Section 2.1(b)(vi) below, not later than fifteen (15) days after the date on
which the Receiver receives the Quarterly Certificate with respect to such
Shared-Loss Quarter, the Receiver shall pay to the Assuming Bank an amount equal
to eighty percent (80%) of the Shared-Loss Amount for such Shared-Loss Quarter.
If the Shared-Loss Amount during any Shared-Loss Quarter is negative, the
Assuming Bank shall pay to the Receiver an amount equal to eighty percent (80%)
of the Shared-Loss Amount for such Shared-Loss Quarter, which payment shall be
delivered to the Receiver together with the Quarterly Certificate for such
Shared-Loss Quarter.  When the cumulative Shared-Loss Amounts for all
Shared-Loss Quarters plus the Cumulative Loss Amount under the Single Family
Shared-Loss Agreement equals or exceeds the Stated Threshold, the Receiver shall
pay to the Assuming Bank an amount equal to ninety-five percent ((95%) of the
Shared-Loss Amount for each Shared-Loss Quarter, until such time as the
cumulative Shared-Loss Amount for all Shared-Loss Quarters is less than the
Stated Threshold, when the percentage shall revert back to eighty percent
(80%).

    

    (ii)           If
the amount of gross Recoveries during any Recovery Quarter less Recovery
Expenses during such Recovery Quarter plus net realized gains or reversals of
OTTI Loss on Shared Loss MTM Assets (the “Recovery Amount”) is positive, then,
simultaneously with its delivery of the Quarterly Certificate with respect to
such Recovery Quarter, the

    
      
        
           

          
            	
                    Module
      1 – Whole Bank w/ Loss Share – P&A

                  	 
      	
                    COOPERATIVE
      BANK

                  
	
                    Version
      1.05

                  	 
      	
                    WILMINGTON,
      NORTH CAROLINA

                  
	
                    June
      16, 2009

                  	 
      	 
      

          

          

        

         

      

      
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    Assuming
Bank shall pay to the Receiver an amount equal to eighty percent (80%) of the
Recovery Amount for such Recovery Quarter. If the Recovery Amount is negative,
then such negative amount shall be subtracted from the amount of gross
Recoveries during the next succeeding Recovery Quarter in determining the
Recovery Amount in such next succeeding Recovery Quarter; provided, that this Section
2.1(b)(ii) shall operate successively in the event that the Recovery Amount
(after giving effect to this Section 2.1(b)(ii)) in such next succeeding
Recovery Quarter is negative. The Assuming Bank shall specify, in the Quarterly
Certificate for the final Recovery Quarter, the aggregate amount for all
Recovery Quarters only, as of the end of, and including, the final Recovery
Quarter of (A) Recoveries plus net realized gains or reversals of OTTI Loss on
Shared Loss MTM Assets (“Aggregate Recovery Period Recoveries”), (B) Recovery
Expenses (“Aggregate Recovery Expenses”), and (C) only those Recovery
Expenses that have been actually “offset” against Aggregate Recovery Period
Recoveries (including those so “offset” in that final Recovery Quarter)
(“Aggregate Offset Recovery Expenses”); as used in this sentence, the term
“offset” means the amount that has been applied to reduce gross Recoveries in
any Recovery Quarter pursuant to the methodology set forth in this Section
2.1(b)(ii).  If, at the end of the final Recovery Quarter the amount
of Aggregate Recovery Expenses exceeds the amount of Aggregate Recovery Period
Recoveries, the Receiver shall have no obligation to pay to the Assuming Bank
all or any portion of such excess. Subsequent to the Assuming Bank’s calculation
of the Recovery Amount (if any) for the final Recovery Quarter, the Assuming
Bank shall also show on the Quarterly Certificate for the final Recovery Quarter
the results of the following three mathematical calculations: (i) Aggregate
Recovery Period Recoveries minus Aggregate
Offset Recovery Expenses; (ii) Aggregate Recovery Expenses minus Aggregate
Offset Recovery Expenses; and (iii) the lesser of the two
amounts calculated in (i) and (ii) immediately above (“Additional Recovery
Expenses”) multiplied
by 80% (the amount so calculated in (iii) being defined as the
“Additional Recovery Expense Amount”). If the Additional Recovery Expense Amount
is greater than zero, then the Assuming Bank may request in the Quarterly
Certificate for the final Recovery Quarter that the Receiver reimburse the
Assuming Bank the amount of the Additional Recovery Expense Amount and the
Receiver shall pay to the Assuming Bank the Additional Recovery Expense Amount
within fifteen (15) days after the date on which the Receiver receives that
Quarterly Certificate. On the Quarterly Certificate for the final Recovery
Quarter only, the Assuming Bank may include, in addition to any Recovery
Expenses for that Recovery Quarter that were paid by or on behalf of the
Assuming Bank in that Recovery Quarter, those Recovery Expenses that: (a) were
incurred prior to or during the final Recovery Quarter, and (b) had not been included in
any Quarterly Certificate for any Recovery Quarter because they had not been
actually paid by or on behalf of the Assuming Bank (in accordance with the terms
of this Commercial Shared-Loss Agreement) during any Recovery Quarter, and (c) were actually
paid by or on behalf of the Assuming Bank (in accordance with the terms of this
Commercial Shared-Loss Agreement) prior to the date the Assuming Bank is
required to deliver that final Quarterly Certificate to the Receiver under the
terms of Section 2.1(a)(ii).

    

    (iii)           With
respect to each Shared-Loss Quarter and Recovery Quarter, collections by or on
behalf of the Assuming Bank on any charge-off effected by the Failed Bank prior
to Bank Closing on an Asset other than a Shared-Loss Asset or Shared-Loss MTM
Assets shall be reported as Recoveries under this Section 2.1 only to the extent
such collections exceed the Book Value of such Asset, if any. For any
Shared-Loss Quarter or Recovery Quarter in

    
      
        
           

          
            	
                    Module
      1 – Whole Bank w/ Loss Share – P&A

                  	 
      	
                    COOPERATIVE
      BANK

                  
	
                    Version
      1.05

                  	 
      	
                    WILMINGTON,
      NORTH CAROLINA

                  
	
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    which
collections by or on behalf of the Assuming Bank on such Asset are applied to
both Book Value and to a charge-off effected by the Failed Bank prior to Bank
Closing, the amount of expenditures incurred by or on behalf of the Assuming
Bank attributable to the collection of any such Asset, that shall be considered
a Reimbursable Expense or a Recovery Expense under this Section 2.1 will be
limited to a proportion of such expenditures which is equal to the proportion
derived by dividing (A) the amount of collections on such Asset applied to a
charge-off effected by the Failed Bank prior to Bank Closing, by (B) the total
collections on such Assets.

    

    (iv)           If
the Assuming Bank has duly specified an amount of Reimbursable Expenses on the
Quarterly Certificate for the first Recovery Quarter as described above in the
last sentence of Section 2.1(a)(ii), then, not later than fifteen (15) days
after the date on which the Receiver receives that Quarterly Certificate, the
Receiver shall pay to the Assuming Bank an amount equal to eighty percent (80%)
(or, if the Cumulative Loss Amount under the Single Family Shared-Loss Agreement
plus the cumulative Shared-Loss Amount for all Shared-Loss Quarters equals or
exceeds the Stated Threshold, ninety-five percent (95%)) of the amount of such
Reimbursable Expenses.

    

    (v)           If
the First Loss Tranche as determined under the Purchase and Assumption Agreement
is a positive number, Receiver has no obligation to make payment for any Shared
Loss Quarters until the Shared-Loss Payment Trigger is satisfied.

    

    (c)           Limitation
on Shared-Loss Payment. The Receiver shall not be
required to make any payments pursuant to this Section 2.1 with respect to any
Charge-Off of a Shared-Loss Asset that the Receiver or the Corporation
determines, based upon the Examination Criteria, should not have been effected
by the Assuming Bank; provided, (x) the Receiver must provide notice to the
Assuming Bank detailing the grounds for not making such payment, (y) the
Receiver must provide the Assuming Bank with a reasonable opportunity to cure
any such deficiency and (z) (1) to the extent curable, if cured, the Receiver
shall make payment with respect to any properly effected Charge-Off and (2) to
the extent not curable, the Receiver shall make a payment as to all Charge-Offs
(or portion of Charge-Offs) that were effected which would have been payable as
a Charge-Off if the Assuming Bank had properly effected such Charge-Off. In the
event that the Receiver does not make any payments with respect to any
Charge-Off of a Shared-Loss Asset pursuant to this Section 2.1 or determines
that a payment was improperly made, the Assuming Bank and the Receiver shall,
upon final resolution, make such accounting adjustments and payments as may be
necessary to give retroactive effect to such corrections.

    

    (d)           Sale of,
or Additional Advances or Amendments with Respect to, Shared-Loss Loans and
Administration of Related Loans. No Shared-Loss Loan shall be
treated as a Shared-Loss Asset pursuant to this Section 2.1 (i) if the Assuming
Bank sells or otherwise transfers such Shared-Loss Loan or any interest therein
(whether with or without recourse) to any Person, (ii) after the Assuming Bank
makes any additional advance, commitment or increase in the amount of a
commitment with respect to such Shared-Loss Loan that does not constitute a
Permitted Advance or a Shared-Loss Loan Commitment Advance, (iii) after the
Assuming Bank makes any amendment, modification, renewal or extension to such
Shared-Loss Loan that does not constitute a Permitted Amendment, or (iv) after
the Assuming

    
      
        
           

          
            	
                    Module
      1 – Whole Bank w/ Loss Share – P&A

                  	 
      	
                    COOPERATIVE
      BANK

                  
	
                    Version
      1.05

                  	 
      	
                    WILMINGTON,
      NORTH CAROLINA

                  
	
                    June
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    Bank has
managed, administered or collected any “Related Loan” (as such term is defined
in Section 3.4 of Article III of this Commercial Shared-Loss Agreement) in any
manner which would have the effect of increasing the amount of any collections
with respect to the Related Loan to the detriment of such Shared-Loss Asset to
which such loan is related; provided, that  any
such Shared-Loss Loan that has been the subject of Charge-Offs prior to the
taking of any action described in clause (i), (ii), or  (iii) or (iv)
of this Section 2.1(d) by the Assuming Bank shall be treated as a Shared-Loss
Asset pursuant to this Section 2.1 solely for the purpose of treatment of
Recoveries on such Charge-Offs until such time as the amount of Recoveries with
respect to such Shared-Loss Asset equals such Charge-Offs.

    

     
(e)           Option to
Purchase.

    

                          (i)           In
the event that the Assuming Bank determines that there is a substantial
likelihood that continued efforts to collect a Shared-Loss Asset or an Asset for
which a charge-off was effected by the Failed Bank with, in either case, a Legal
Balance of $500,000 or more on the Accounting Records of the Assuming Bank will
result in an expenditure, after Bank Closing, of funds by on behalf of the
Assuming Bank to a third party for a specified purpose (the expenditure of
which, in its best judgment, will maximize collections), which do not constitute
Reimbursable Expenses or Recovery Expenses, and such expenses will exceed ten
percent (10%) of the then book value thereof as reflected on the Accounting
Records of the Assuming Bank, the Assuming Bank shall (i) promptly so notify the
Receiver and (ii) request that such expenditure be treated as a Reimbursable
Expense or Recovery Expense for purposes of this Section 2.1. (Where the
Assuming Bank determines that there is a substantial likelihood that the
previously mentioned situation exists with respect to continued efforts to
collect a Shared-Loss Asset or an Asset for which a charge-off was effected by
the Failed Bank with, in either case, a Legal Balance of less than $1,000,000 on
the Accounting Records of the Assuming Bank, the Assuming Bank may so notify the
Receiver and request that such expenditure be treated as a Reimbursable Expense
or Recovery Expense.) Within thirty (30) days after its receipt of such a
notice, the Receiver will advise the Assuming Bank of its consent or denial,
that such expenditures shall be treated as a Reimbursable Expense or Recovery
Expense, as the case may be. Notwithstanding the failure of the Receiver to give
its consent with respect to such expenditures, the Assuming Bank shall continue
to administer such Shared-Loss Asset in accordance with Section 2.2, except that
the Assuming Bank shall not be required to make such expenditures. At any time
after its receipt of such a notice and on or prior to the Termination Date the
Receiver shall have the right to purchase such Shared-Loss Asset or Asset as
provided in Section 2.1(e)(iii), notwithstanding any consent by the Receiver
with respect to such expenditure.

     

    

    (ii)           
During the period prior to the Termination Date, the Assuming Bank shall notify
the Receiver within fifteen (15) days after any of the following becomes fully
or partially charged-off:

    

    (A) a
Shared-Loss Loan having a Legal Balance (or, in the case of more than one (1)
Shared-Loss Loan made to the same Obligor, a combined Legal Balance) of $500,000
or more in circumstances in which the legal claim against the relevant Obligor
survives; or

    
      
        
           

          
            	
                    Module
      1 – Whole Bank w/ Loss Share – P&A

                  	 
      	
                    COOPERATIVE
      BANK

                  
	
                    Version
      1.05

                  	 
      	
                    WILMINGTON,
      NORTH CAROLINA

                  
	
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    (B) a
Shared-Loss Loan to a director, an “executive officer” as defined in 12 C.F.R. 
215.2(d), a “principal shareholder” as defined in 12 C.F.R.  215.2(l), or an
Affiliate of the Assuming Bank.

    

    (iii)           If
the Receiver determines in its discretion that the Assuming Bank is not
diligently pursuing collection efforts with respect to any Shared-Loss Asset
which has been fully or partially charged-off or written-down (including any
Shared-Loss Asset which is identified or required to be identified in a notice
pursuant to Section 2.1(e)(ii)) or any Asset for which there exists a Failed
Bank Charge-Off/Write-Down, the Receiver may at its option, exercisable at any
time on or prior to the Termination Date, require the Assuming Bank to assign,
transfer and convey such Shared-Loss Asset or Asset to and for the sole benefit
of the Receiver for a price equal to the Shared-Loss Asset Repurchase Price
thereof less the Related Liability Amount with respect to any Related
Liabilities related to such Shared-Loss Asset or Asset.

    

    (iv)           Not
later than ten (10) days after the date upon which the Assuming Bank receives
notice of the Receiver’s intention to purchase or require the assignment of any
Shared-Loss Asset or Asset pursuant to Section 2.1(e)(i) or (iii), the Assuming
Bank shall transfer to the Receiver such Shared-Loss Asset or Asset and any
Credit Files relating thereto and shall take all such other actions as may be
necessary and appropriate to adequately effect the transfer of such Shared-Loss
Asset or Asset from the Assuming Bank to the Receiver. Not later than fifteen
(15) days after the date upon which the Receiver receives such Shared-Loss Asset
or Asset and any Credit Files relating thereto, the Receiver shall pay to the
Assuming Bank an amount equal to the Shared-Loss Asset Repurchase Price of such
Shared-Loss Asset or Asset less the Related Liability Amount.

    

    (v)           The
Receiver shall assume all Related Liabilities with respect to any Shared-Loss
Asset or Asset set forth in the notice described in Section
2.1(e)(iv).

    

    (f)           Dispute
Resolution.

    

    (i) (A)
Any dispute as to whether a Charge-Off of a Shared-Loss Asset was made in
accordance with Examination Criteria shall be resolved by the Assuming Bank’s
Chartering Authority. (B) With respect to any other dispute arising under the
terms of this Commercial Shared-Loss Agreement which the parties hereto cannot
resolve after having negotiated such matter, in good faith, for a thirty (30)
day period, other than a dispute the Corporation is not permitted to submit to
arbitration under the Administrative Dispute Resolution Act of 1996 (“ADRA”), as
amended, such other dispute shall be resolved by determination of a review board
(a “Review Board”) established pursuant to Section 2.1(f). Any Review Board
under this Section 2.1(f) shall follow the provisions of the Federal Arbitration
Act and shall follow the provisions of the ADRA. (C) Any determination by the
Assuming Bank’s Chartering Authority or by a Review Board shall be conclusive
and binding on the parties hereto and not subject to further dispute, and
judgment may be entered on said determination in accordance with applicable
arbitration law in any court having jurisdiction thereof.

    
      
        
           

          
            	
                    Module
      1 – Whole Bank w/ Loss Share – P&A

                  	 
      	
                    COOPERATIVE
      BANK

                  
	
                    Version
      1.05

                  	 
      	
                    WILMINGTON,
      NORTH CAROLINA

                  
	
                    June
      16, 2009

                  	 
      	 
      

          

          

        

         

      

      
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    (ii)           A
Review Board shall consist of three (3) members, each of whom shall have such
expertise as the Corporation and the Assuming Bank agree is relevant. As
appropriate, the Receiver or the Corporation (the “FDIC Party”) will select one
member, one member will be selected by the Assuming Bank and the third member
(the “Neutral Member”) will be selected by the other two members. The member of
the Review Board selected by a party may be removed at any time by such party
upon two (2) days’ written notice to the other party of the selection of a
replacement member. The Neutral Member may be removed by unanimous action of the
members appointed by the FDIC Party and the Assuming Bank after two (2) days’
prior written notice to the FDIC Party and the Assuming Bank of the selection of
a replacement Neutral Member.  In addition, if a Neutral Member fails
for any reason to serve or continue to serve on the Review Board, the other
remaining members shall so notify the parties to the dispute and the Neutral
Member in writing that such Neutral Member will be replaced, and the Neutral
Member shall thereafter be replaced by the unanimous action of the other
remaining members within twenty (20) business days of that
notification.

    

    (iii)           No
dispute may be submitted to a Review Board by any of the parties to this
Commercial Shared-Loss Agreement unless such party has provided to the other
party a written notice of dispute (“Notice of Dispute”). During the forty-five
(45)-day period following the providing of a Notice of Dispute, the parties to
the dispute will make every effort in good faith to resolve the dispute by
mutual agreement. As part of these good faith efforts, the parties should
consider the use of less formal dispute resolution techniques, as judged
appropriate by each party in its sole discretion. Such techniques may include,
but are not limited to, mediation, settlement conference, and early neutral
evaluation. If the parties have not agreed to a resolution of the dispute by the
end of such forty-five (45)-day period, then, subject to the discretion of the
Corporation and the written consent of the Assuming Bank as set forth in Section
2.1(f)(i)(B) above, on the first day following the end of such period, the FDIC
Party and the Assuming Bank shall notify each other of its selection of its
member of the Review Board and such members shall be instructed to promptly
select the Neutral Member of the Review Board. If the members appointed by the
FDIC Party and the Assuming Bank are unable to promptly agree upon the initial
selection of the Neutral Member, or a timely replacement Neutral Member as set
forth in Section 2.1(f)(ii) above, the two appointed members shall apply to the
American Arbitration Association (“AAA”), and such Neutral Member shall be
appointed in accordance with the Commercial Arbitration Rules of the
AAA.

    

    (iv)           The
resolution of a dispute pursuant to this Section 2.1(f) shall be governed by the
Commercial Arbitration Rules of the AAA to the extent that such rules are not
inconsistent with this Section 2.1(f). The Review Board may modify the
procedures set forth in such rules from time to time with the prior approval of
the FDIC Party and the Assuming Bank.

    

    (v)           Within
fifteen (15) days after the last to occur of the final written submissions of
both parties, the presentation of witnesses, if any, and oral presentations, if
any, the Review Board shall adopt the position of one of the parties and shall
present to the parties a written award regarding the dispute. The determination
of any two (2) members of a Review Board will constitute the determination of
such Review Board.

    

    (vi)           The
FDIC Party and the Assuming Bank will each pay the fees and expenses of the
member of the Review Board selected by it. The FDIC Party and
Assuming

    
      
        
           

          
            	
                    Module
      1 – Whole Bank w/ Loss Share – P&A

                  	 
      	
                    COOPERATIVE
      BANK

                  
	
                    Version
      1.05

                  	 
      	
                    WILMINGTON,
      NORTH CAROLINA

                  
	
                    June
      16, 2009

                  	 
      	 
      

          

          

        

         

      

      
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    Bank will
share equally the fees and expenses of the Neutral Member. No such fees or
expenses incurred by or on behalf of the Assuming Bank shall be subject to
reimbursement by the FDIC Party under this Commercial Shared-Loss Agreement or
otherwise.

    

    (vii)           Each
party will bear all costs and expenses incurred by it in connection with the
submission of any dispute to a Review Board. No such costs or expenses incurred
by or on behalf of the Assuming Bank shall be subject to reimbursement by the
FDIC Party under this Commercial Shared-Loss Agreement or otherwise. The Review
Board shall have no authority to award costs or expenses incurred by either
party to these proceedings.

    

        
           (viii)         Any
dispute resolution proceeding held pursu­ant to this Section 2.1(f) shall
not be public. In addi­tion, each party and each member of any Review Board
shall strictly maintain the confidentiality of all issues, dis­putes,
arguments, positions and interpretations of any such proceeding, as well as all
information, attachments, enclosures, exhibits, sum­maries, compilations,
studies, analyses, notes, documents, statements, schedules and other similar
items associated therewith, except as the parties agree in writing or such
disclosure is required pursuant to law, rule or regulation. Pursuant to ADRA,
dispute resolution communications may not be disclosed either by the parties or
by any member of the Review board unless:

    

    (1) all
parties to the dispute resolution proceeding agree in writing;

    (2) the
communication has already been made public;

    (3) the
communication is required by statute, rule or regulation to be made public;
or

    (4) a
court determines that such testimony or disclosure is necessary to prevent a
manifest injustice, help establish a violation of the law or prevent harm to the
public health or safety, or of sufficient magnitude in the particular case to
outweigh the integrity of dispute resolution proceedings in general by reducing
the confidence of parties in future cases that their communications will remain
confidential.

    

    (ix)           Any
dispute resolution proceeding pursuant to this Section 2.1(f) (whether as a
matter of good faith negotiations, by resort to a Review Board, or otherwise) is
a compromise negotiation for purposes of the Federal Rules of Evidence and state
rules of evidence. The parties agree that all proceedings, including any
statement made or document prepared by any party, attorney or other participants
are privileged and shall not be disclosed in any subsequent proceeding or
document or construed for any purpose as an admission against interest. Any
document submitted and any statements made during any dispute resolution
proceeding are for settlement purposes only. The parties further agree not to
subpoena any of the members of the Review Board or any documents submitted to
the Review Board. In no event will the Neutral Member voluntarily testify on
behalf of any party.

    

    (x)           No
decision, interpretation, determination, analysis, statement, award or other
pronouncement of any Review Board shall constitute precedent as regards any
sub­sequent proceeding (whether or not such proceeding involves dispute
resolution under this Commercial Shared-Loss Agreement) nor shall any Review
Board be bound to follow any decision, interpreta­tion, determination,
analysis, statement, award or other pronouncement rendered by
any

    
      
        
           

          
            	
                    Module
      1 – Whole Bank w/ Loss Share – P&A

                  	 
      	
                    COOPERATIVE
      BANK

                  
	
                    Version
      1.05

                  	 
      	
                    WILMINGTON,
      NORTH CAROLINA

                  
	
                    June
      16, 2009

                  	 
      	 
      

          

          

        

         

      

      
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    previous
Review Board or any other previous dispute resolution panel which may have
convened in connection with a transaction involving other failed financial
institutions or Federal assistance transactions.

    

    (xi)           The
parties may extend any period of time in this Section 2.1(f) by mutual
agreement. Notwithstanding anything above to the contrary, no dispute shall be
submitted to a Review Board until each member of the Review Board, and any
substitute member, if applicable, agrees to be bound by the provisions of this
Section 2.1(f) as applicable to members of a Review Board. Prior to the
commencement of the Review Board proceedings, or, in the case of a substitute
Neutral Member, prior to the re-commencement of such proceedings subsequent to
that substitution, the Neutral Member shall provide a written oath of
impartiality.

    

    (xii)           For
the avoidance of doubt, and notwithstanding anything herein to the contrary, in
the event any notice of dispute is provided to a party under this Section 2.1(g)
prior to the Termination Date, the terms of this Commercial Shared-Loss
Agreement shall remain in effect with respect to any such items set forth in
such notice until such time as any such dispute with respect to such item is
finally resolved.

    

    2.2           Administration
of Shared-Loss Assets.
The Assuming Bank shall at all times prior to the Termination Date comply
with the Rules Regarding the Administration of Shared-Loss Assets as set forth
in Article III of this Commercial Shared-Loss Agreement.

    

    2.3           Auditor Report; Right to
Audit.

    

    (a)           Within
ninety (90) days after the end of each fiscal year from and including the fiscal
year during which Bank Closing falls to and including the calendar year during
which the Termination Date falls, the Assuming Bank shall deliver to the
Corporation and to the Receiver a report signed by its independent public
accountants stating that they have reviewed the terms of this Commercial
Shared-Loss Agreement and that, in the course of their annual audit of the
Assuming Bank’s books and records, nothing has come to their attention
suggesting that any computations required to be made by the Assuming Bank during
such calendar year by this Article II were not made by the Assuming Bank in
accordance herewith. In the event that the Assuming Bank cannot comply with the
preceding sentence, it shall promptly submit to the Receiver corrected
computations together with a report signed by its independent public accountants
stating that, after giving effect to such corrected computations, nothing has
come to their attention suggesting that any computations required to be made by
the Assuming Bank during such year by this Article II were not made by the
Assuming Bank in accordance herewith. In such event, the Assuming Bank and the
Receiver shall make all such accounting adjustments and payments as may be
necessary to give effect to each correction reflected in such corrected
computations, retroactive to the date on which the corresponding incorrect
computation was made.

    

    (b)           The
Assuming Bank shall perform on an annual basis an internal audit of its
compliance with the provisions of this Article II and shall provide the Receiver
and the Corporation with copies of the internal audit reports and access to
internal audit workpapers related to such internal audit.

    
      
        
           

          
            	
                    Module
      1 – Whole Bank w/ Loss Share – P&A

                  	 
      	
                    COOPERATIVE
      BANK

                  
	
                    Version
      1.05

                  	 
      	
                    WILMINGTON,
      NORTH CAROLINA

                  
	
                    June
      16, 2009

                  	 
      	 
      

          

          

        

         

      

      
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    (c)           The
Receiver or the Corporation may perform an audit to determine the Assuming
Bank’s compliance with the provisions of this Commercial Shared-Loss Agreement,
including this Article II, at any time by providing not less than ten (10)
Business Days prior written notice. The scope and duration of any such audit
shall be within the discretion of the Receiver or the Corporation, as the case
may be, but shall in no event be administered in a manner that unreasonably
interferes with the operation of the Assuming Bank’s business. The Receiver or
the Corporation, as the case may be, shall bear the expense of any such audit.
In the event that any corrections are necessary as a result of such an audit,
the Assuming Bank and the Receiver shall make such accounting adjustments and
payments as may be necessary to give retroactive effect to such
corrections.

    

    2.4           Withholdings.  Notwithstanding
any other provision in this Article II, the Receiver, upon the direction of the
Director (or designee) of the Corporation’s Division of Resolutions and
Receiverships, may withhold payment for any amounts included in a Quarterly
Certificate delivered pursuant to Section 2.1, if, in its judgment, there is a
reasonable basis under the terms of this Commercial Shared-Loss Agreement for
denying the eligibility of an item for which reimbursement or payment is sought
under such Section. In such event, the Receiver shall provide a written notice
to the Assuming Bank detailing the grounds for withholding such payment. At such
time as the Assuming Bank demonstrates to the satisfaction of the Receiver that
the grounds for such withholding of payment, or portion of payment, no longer
exist or have been cured, then the Receiver shall pay the Assuming Bank the
amount withheld which the Receiver determines is eligible for payment, within
fifteen (15) Business Days. In the event the Receiver or the Assuming Bank
elects to submit the issue of the eligibility of the item for reimbursement or
payment for determination under the dispute resolution procedures of Section
2.1(f), then (i) if the dispute is settled by the mutual agreement of the
parties in accordance with Section 2.1(f)(iii), the Receiver shall pay the
amount withheld (to the extent so agreed) within fifteen (15) Business Days from
the date upon which the dispute is determined by the parties to be resolved by
mutual agreement, and (ii) if the dispute is resolved by the determination of a
Review Board, the Receiver shall pay the amount withheld (to the extent so
determined) within fifteen (15) Business Days from the date upon which the
Receiver is notified of the determination by the Review Board of its obligation
to make such payment. Any payment by the Receiver pursuant to this Section 2.4
shall be made together with interest on the amount thereof from the date the
payment was agreed or determined otherwise to be due, at the interest rate per
annum determined by the Receiver to be equal to the coupon equivalent of the
three (3)-month U.S. Treasury Bill Rate in effect as of the first Business Day
of each Calendar Quarter during which such interest accrues as reported in the
Federal Reserve Board’s Statistical Release for Selected Interest Rates H.15
opposite the caption “Auction Average - 3-Month” or, if not so reported for such
day, for the next preceding Business Day for which such rate was so
reported.

    

    2.5           Books and
Records.  The Assuming Bank shall at all times during the term
of this Commercial Shared-Loss Agreement keep books and records which fairly
present all dealings and transactions carried out in connection with its
business and affairs. Except as otherwise provided for in the Purchase and
Assumption Agreement or this Commercial Shared-Loss Agreement, all financial
books and records shall be kept in accor­dance with gen­erally accepted
accounting principles, consistently applied for the periods involved and in a
manner

    
      
        
           

          
            	
                    Module
      1 – Whole Bank w/ Loss Share – P&A

                  	 
      	
                    COOPERATIVE
      BANK

                  
	
                    Version
      1.05

                  	 
      	
                    WILMINGTON,
      NORTH CAROLINA

                  
	
                    June
      16, 2009

                  	 
      	 
      

          

          

        

         

      

      
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    such that
information neces­sary to determine compliance with any requirement of the
Purchase and Assumption Agreement or this Commercial Shared-Loss Agreement will
be readily obtainable, and in a manner such that the purposes of the Purchase
and Assumption Agreement or this Commercial Shared-Loss Agreement may be
effectively accomplished. With­out the prior written approval of the
Corporation, the Assuming Bank shall not make any change in its accounting
prin­ciples adversely affecting the value of the Shared-Loss Assets except
as required by a change in generally accepted accounting principles. The
Assuming Bank shall notify the Corporation of any change in its accounting
principles affecting the Shared-Loss Assets which it believes are required by a
change in generally accepted accounting principles.

    

    2.6           Information.  The
Assuming Bank shall promptly pro­vide to the Corporation such other
information, including finan­cial statements and computa­tions, relating
to the perfor­mance of the provisions of the Purchase and Assumption
Agreement or otherwise relating to its business and affairs or this Commercial
Shared-Loss Agreement, as the Corporation or the Receiver may request from time
to time.

    

    2.7            Tax
Ruling.  The Assuming Bank
shall not at any time, without the Corporation’s prior written consent, seek a
private letter ruling or other determination from the Internal Revenue Service
or otherwise seek to qualify for any special tax treat­ment or benefits
associated with any payments made by the Corpo­ration pursuant to the
Purchase and Assumption Agreement or this Commercial Shared-Loss
Agreement.

    

    ARTICLE
III -- RULES REGARDING THE ADMINISTRATION OF SHARED-LOSS

    ASSETS
AND SHARED-LOSS MTM ASSETS

    

    

    3.1           Agreement
with Respect to Administration. The Assuming Bank shall (and
shall cause any of its Affiliates to which the Assuming Bank transfers any
Shared-Loss Assets or Shared-Loss MTM Assets) to, or a Third Party Servicer to,
manage, administer, and collect the Shared-Loss Assets and Shared-Loss MTM
Assets while owned by the Assuming Bank or any Affiliate thereof during the term
of this Commercial Shared-Loss Agreement in accor­dance with the rules set
forth in this Article III (“Rules”). The Assuming Bank shall be responsible to
the Receiver and the Corporation in the performance of its duties hereunder and
shall provide to the Receiver and the Corporation such reports as the Receiver
or the Corporation reasonably deems advisable, including but not limited to the
reports required by Section 3.3 hereof, and shall permit the Receiver and the
Corporation at all times to monitor the Assuming Bank’s performance of its
duties hereunder.

    

    3.2           Duties of
the Assuming Bank with Respect to Shared-Loss Assets.

    

    (a)  In
performance of its duties under these Rules, the Assuming Bank
shall:

    

    (i)
manage, administer, collect and effect Charge-Offs and Recoveries with respect
to each Shared-Loss Asset in a manner con­sis­tent with (A) usual and
prudent business and banking practices; (B) the Assuming Bank’s (or, in the case
a Third Party Servicer is engaged, the Third Party Servicer’s) practices and
proce­dures including, without limitation,

    
      
        
           

          
            	
                    Module
      1 – Whole Bank w/ Loss Share – P&A

                  	 
      	
                    COOPERATIVE
      BANK

                  
	
                    Version
      1.05

                  	 
      	
                    WILMINGTON,
      NORTH CAROLINA

                  
	
                    June
      16, 2009

                  	 
      	 
      

          

          

        

         

      

      
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    the
then-effective written internal credit policy guidelines of the Assuming Bank,
with respect to the management, administration and collec­tion of and taking
of charge-offs and write-downs with respect to loans, other real estate and
repossessed collateral that do not constitute Shared Loss Assets;

    

    (ii)
exercise its best business judgment in managing, administering, collecting and
effecting Charge-Offs with respect to Shared-Loss Assets;

    

    (iii) use
its best efforts to maximize collections with respect to Shared-Loss Assets and,
if applicable for a particular Shared-Loss Asset, without regard to the effect
of maximizing collections on assets held by the Assuming Bank or any of its
Affiliates that are not Shared-Loss Assets;

    

    (iv)
adopt and implement accounting, reporting, record-keeping and similar systems
with respect to the Shared-Loss Assets, as provided in Section 3.4
hereof;

    

    (v)
retain sufficient staff to perform its duties hereunder;

    

    (vi)
provide written notification in accordance with Article IV of this Commercial
Shared-Loss Agreement immediately after the execution of any contract pursuant
to which any third party (other than an Affiliate of the Assuming Bank) will
manage, administer or collect any of the Shared-Loss Assets, together with a
copy of that contract.

    

    (b)  Any
transaction with or between any Affiliate of the Assuming Bank with respect to
any Shared-Loss Asset including, without limitation, the execution of any
contract pursuant to which any Affiliate of the Assuming Bank will manage,
administer or collect any of the Shared-Loss Assets, or any other action
involving self-dealing, shall be subject to the prior written approval of the
Receiver or the Corporation.

    

    (c)  The
following categories of expenses shall not be deemed to be Reimbursable Expenses
or Recovery Expenses:

    

    (i)  Federal,
State, or local income taxes and expenses related thereto;

    
 

    (ii)
salaries or other compensation and related benefits of Assuming Bank employees
and the employees of its Affiliates including, without limitation, any bonus,
commission or severance arrange­ments, training, payroll taxes, dues, or
travel- or relocation-related expenses,;

    

    (iii) the
cost of space occupied by the Assuming Bank, any Affiliate thereof and their
staff, the rental of and maintenance of furni­ture and equipment, and
expenses for data processing including the purchase or enhancement of data
processing systems;

    

    (iv)
except as otherwise provided herein, fees for accounting and other independent
professional consultants (other than consultants retained to assess the
presence, storage or release of any hazardous or toxic substance, or any
pollutant or contaminant with

    
      
        
           

          
            	
                    Module
      1 – Whole Bank w/ Loss Share – P&A

                  	 
      	
                    COOPERATIVE
      BANK

                  
	
                    Version
      1.05

                  	 
      	
                    WILMINGTON,
      NORTH CAROLINA

                  
	
                    June
      16, 2009

                  	 
      	 
      

          

          

        

         

      

      
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    respect
to the collateral securing a Shared-Loss Loan that has been fully or partially
charged-off); provided, that for purposes of
this Section 3.2(c)(iv), fees of attorneys and appraisers engaged as necessary
to assist in collections with respect to Shared-Loss Assets shall not be deemed
to be fees of other independent consultants;

    

    (v)  allocated
portions of any other overhead or general and administrative expense other than
any fees relating to specific assets, such as appraisal fees or environmental
audit fees, for services of a type the Assuming Bank does not normally perform
internally;

    

    (vi) any
expense not incurred in good faith and with the same degree of care that the
Assuming Bank normally would exercise in the collection of troubled assets in
which it alone had an interest; and

    

    (vii) any
expense incurred for a product, service or activity that is of an extravagant
nature or design.

    

    (d)  Subject
to Section 3.7, the Assuming Bank shall not contract with third parties to
provide services the cost of which would be a Reimbursable Expense or Recovery
Expense if the Assuming Bank would have provided such services itself if the
relevant Shared-Loss Assets were not subject to the loss-sharing provisions of
Section 2.1 of this Commercial Shared-Loss Agreement.

    

    3.3           Duties of
the Assuming Bank with Respect to Shared-Loss MTM Assets.

    

    (a)  In
performance of its duties under these Rules, the Assuming Bank
shall:

    

    (i)
manage, administer, collect and each Shared-Loss MTM Asset in a manner
consistent with (A) usual and prudent business and banking practices; (B) the
Assuming Bank’s practices and procedures including, without limitation, the
then-effective written internal credit policy guidelines of the Assuming Bank,
with respect to the management, administration and collec­tion of similar
assets that are not Shared-Loss MTM Assets;

    

    (ii)
exercise its best business judgment in managing, administering, collecting and
effecting Charge-Offs with respect to Shared-Loss MTM Assets;

    

    (iii) use
its best efforts to maximize collections with respect to Shared-Loss MTM Assets
and, if applicable for a particular Shared-Loss MTM Asset, without regard to the
effect of maximizing collections on assets held by the Assuming Bank or any of
its Affiliates that are not Shared-Loss MTM Assets, provided that, any sale of a
Shared-Loss MTM Asset shall only be made with the prior approval of the Receiver
or the Corporation;

    

    (iv)
adopt and implement accounting, reporting, record-keeping and similar systems
with respect to the Shared-Loss MTM Assets, as provided in Section 3.4
hereof;

    

    (v)
retain sufficient staff to perform its duties hereunder;

    
      
        
           

          
            	
                    Module
      1 – Whole Bank w/ Loss Share – P&A

                  	 
      	
                    COOPERATIVE
      BANK

                  
	
                    Version
      1.05

                  	 
      	
                    WILMINGTON,
      NORTH CAROLINA

                  
	
                    June
      16, 2009

                  	 
      	 
      

          

          

        

         

      

      
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    (vi)
provide written notification in accordance with Article IV of this Commercial
Shared-Loss Agreement immediately after the execution of any contract pursuant
to which any third party (other than an Affiliate of the Assuming Bank) will
manage, administer or collect any of the Shared-Loss MTM Assets, together with a
copy of that contract.

    

    (b)  Any
transaction with or between any Affiliate of the Assuming Bank with respect to
any Shared-Loss MTM Asset including, without limitation, the execution of any
contract pursuant to which any Affiliate of the Assuming Bank will manage,
administer or collect any of the Shared-Loss Assets, or any other action
involving self-dealing, shall be subject to the prior written approval of the
Receiver or the Corporation.

    

    (c)   The
Assuming Bank shall not contract with third parties to provide services the cost
of which would be a Reimbursable Expense or Recovery Expense if the Assuming
Bank would have provided such services itself if the relevant Shared-Loss Assets
were not subject to the loss-sharing provisions of Section 2.1 of this
Commercial Shared-Loss Agreement.

    

    3.4           Records
and Reports. The Assuming Bank shall establish and maintain records on a
separate general ledger, and on such subsidiary ledgers as may be appropriate to
account for the Shared-Loss Assets and the Shared-Loss MTM Assets, in such form
and detail as the Receiver or the Corporation may require, to enable the
Assuming Bank to prepare and deliver to the Receiver or the Corporation such
reports as the Receiver or the Corporation may from time to time request
regarding the Shared-Loss Assets, the Shared-Loss MTM Assets and the Quarterly
Certificates required by Section 2.1 of this Commercial Shared-Loss
Agreement.

    

    3.5           Related
Loans.

    

    (a)           The
Assuming Bank shall not manage, administer or collect any “Related Loan” in any
manner which would have the effect of increasing the amount of any collections
with respect to the Related Loan to the detriment of the Shared-Loss Asset to
which such loan is related. A “Related Loan” means any loan or extension of
credit held by the Assuming Bank at any time on or prior to the end of the final
Recovery Quarter that is: (i) made to the same Obligor with respect to a Loan
that is a Shared-Loss Asset or with respect to a Loan from which Other Real
Estate, Additional ORE or Subsidiary ORE derived, or (ii) attributable to the
same primary Obligor with respect to any Loan described in clause (i) under the
rules of the Assuming Bank’s Chartering Authority concerning the legal lending
limits of financial institutions organized under its jurisdic­tion as in
effect on the Commencement Date, as applied to the Assuming Bank.

    

    (b)           The
Assuming Bank shall prepare and deliver to the Receiver with the Quarterly
Certificates for the Calendar Quarters ending June 30 and December 31 for all
Shared-Loss Quarters and Recovery Quarters, a schedule of all Related Loans
which are commercial loans or commercial real estate loans with Legal Balances
of $500,000 or more on the Accounting Records of the Assuming Bank as of the end
of each such semi-annual period, and all other commercial loans or commercial
real estate loans attributable to the same Obligor on such loans of $500,000 or
more.

    
      
        
           

          
            	
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    3.6           Legal
Action; Utilization of Special Receivership Powers. The Assuming Bank
shall notify the Receiver in writing (such notice to be given in accordance with
Article IV below and to include all relevant details) prior to utilizing in any
legal action any special legal power or right which the Assuming Bank derives as
a result of having acquired a Shared-Loss Asset from the Receiver, and the
Assuming Bank shall not utilize any such power unless the Receiver shall have
consented in writing to the proposed usage. The Receiver shall have the right to
direct such proposed usage by the Assuming Bank and the Assuming Bank shall
comply in all respects with such direction. Upon request of the Receiver, the
Assuming Bank will advise the Receiver as to the status of any such legal
action. The Assuming Bank shall immediately notify the Receiver of any judgment
in litigation involving any of the aforesaid special powers or
rights.

    

    3.7           Third-Party
Servicer.  The Assuming Bank may perform any of its obligations
and/or exercise any of its rights under this Commercial Shared-Loss Agreement
through or by one or more Third-Party Servicers, who may take actions and make
expenditures as if any such Third-Party Servicer was the Assuming Bank hereunder
(and, for the avoidance of doubt, such expenses incurred by any such Third-Party
Servicer on behalf of the Assuming Bank shall be Reimbursable Expenses or
Recovery Expenses, as the case may be, to the same extent such expenses would so
qualify if incurred by the Assuming Bank); provided, however, that the use
thereof by the Assuming Bank shall not release the Assuming Bank of any
obligation or liability hereunder.

    

    ARTICLE
IV -- PORTFOLIO SALE

     

    4.1           Assuming
Bank Portfolio Sales of Remaining Shared-Loss Assets.  The
Assuming Bank shall have the right with the concurrence of the Receiver,
commencing as of the first day of the third to last Shared-Loss Quarter, to
liquidate for cash consideration, in one or more transactions, all or a portion
of Shared-Loss Assets held by the Assuming Bank (“Portfolio
Sales”).  If the Assuming Bank exercises its option under this Section
4.1, it must give thirty (30) days notice in writing to the Receiver setting
forth the details and schedule for the Portfolio Sale which shall be conducted
by means of sealed bid sales to third parties, not including any of the Assuming
Bank’s affiliates, contractors, or any affiliates of the Assuming Bank’s
contractors.

     

    4.2           Calculation
of Sale Gain or
Loss.  For Shared-Loss Assets gain or loss on the sales under
Section 4.1 will be calculated as the sale price received by the Assuming Bank
less the book value of the remaining Shared-Loss Assets.

     

    

     

    ARTICLE
V -- LOSS-SHARING NOTICES GIVEN TO CORPORATION AND/OR RECEIVER

     

    As a
supplement to the notice provisions contained in Section 13.7 of the Purchase
and Assumption Agreement, any notice, request, demand, consent, approval, or
other communication (a “Notice”) given to the Corporation and/or the Receiver in
the loss-sharing context shall be given as follows:

     

    5.1           With
respect to a Notice under Section 2 and Sections 3.1-3.5 of this Commercial
Shared-Loss Agreement:

     

    
      
        
           

          
            	
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    Federal
Deposit Insurance Corporation

    Division
of Resolutions and Receiverships

    550 17th
Street, N.W.

    Washington,
D.C.  20429

    Attention:
Assistant Director, Franchise and Asset Marketing

     

    5.2           With
respect to a Notice under Section 3.6 of this Commercial Shared-Loss
Agreement:

     

    Federal
Deposit Insurance Corporation Legal Division

    1601
Bryan Street

    Dallas,
Texas 75201

    Attention:
Regional Counsel

     

    with a
copy to:

     

    Federal
Deposit Insurance Corporation Legal Division

    550 17th
Street, N.W.

    Washington,
D.C.  20429

    Attention:
Senior Counsel (Special Issues Group)

     

    

     

    ARTICLE VI –
MISCELLANEOUS

     

    

     

    6.1    Expenses.  Except as
otherwise expressly provided herein, all costs and expenses incurred by a party
hereto in connection with this Commercial Shared-Loss Agreement shall be borne by such party
whether or not the transactions contemplated herein shall be
consummated.

     

    6.2            Successors
and Assigns; Specific Performance. 
All terms and
provisions of this Commercial Shared-Loss Agreement shall be binding upon and
shall inure to the benefit of the parties hereto only; provided, however, that, Receiver may assign
or otherwise transfer this Commercial Shared-Loss Agreement (in whole or in
part) to the Federal Deposit Insurance Corporation in its corporate capacity
without the consent of Assuming Bank.  Notwithstanding anything to the
contrary contained in this Commercial Shared-Loss Agreement, except as is
expressly permitted in this Section 6.2, Assuming Bank may not assign or
otherwise transfer this Commercial Shared-Loss Agreement (in whole or in part)
without the prior written consent of the Receiver, which consent may be granted
or withheld by the Receiver in its sole discretion, and any attempted assignment
or transfer in violation of this provision shall be void ab
initio.  For the avoidance of doubt, a
merger or consolidation of the Assuming Bank with and into another financial
institution, the sale of all or substantially all of the assets of the Assuming
Bank to another financial institution constitutes the transfer of this
Commercial Shared-Loss Agreement which requires the consent of the
Receiver.

     

    
      
        
           

          
            	
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    6.3    Governing
Law. This Commercial
Shared-Loss Agreement
shall be construed in accordance with federal law, or, if there is no applicable
federal law, the laws of the State of New York, without regard to any rule of
conflict of law that would result in the application of the substantive law of
any jurisdiction other than the State of New York.

     

    6.4    WAIVER
OF JURY TRIAL. EACH PARTY HERETO HEREBY
IRREVOCABLY AND UNCONDITIONALLY WAIVES ALL RIGHT TO TRIAL BY JURY IN OR TO HAVE
A JURY PARTICIPATE IN RESOLVING ANY DISPUTE, ACTION, PROCEEDING OR COUNTERCLAIM,
WHETHER SOUNDING IN CONTRACT, TORT OR OTHERWISE, ARISING OUT OF OR RELATING TO
OR IN CONNECTION WITH THIS COMMERCIAL SHARED-LOSS AGREEMENT OR ANY OF THE TRANSACTIONS
CONTEMPLATED HEREBY.

     

    6.5    Captions. All captions and headings
contained in this Commercial Shared-Loss Agreement are for convenience of
reference only and do not form a part of, and shall not affect the meaning or
interpretation of, this Commercial Shared-Loss Agreement.

     

    6.6            Entire
Agreement; Amendments. This Commercial
Shared-Loss Agreement, along with the Single Family Shared-Loss Agreement and
the Purchase and Assumption Agreement, including the Exhibits and
any other documents delivered pursuant hereto, embody the entire agreement of
the parties with respect to the subject matter hereof, and supersede all prior
representations, warranties, offers, acceptances, agreements and understandings,
written or oral, relating to the subject matter herein. This Commercial
Shared-Loss Agreement
may be amended or modified or any provision thereof waived only by a written
instrument signed by both parties or their respective duly authorized
agents.

     

    6.7           Severability. Whenever possible, each
provision of this Commercial Shared-Loss Agreement shall be interpreted in such
manner as to be effective and valid under applicable law, but if any provision
of this Commercial Shared-Loss Agreement is held to be prohibited by
or invalid, illegal or unenforceable under applicable law, such provision shall
be construed and enforced as if it had been more narrowly drawn so as not to be
prohibited, invalid, illegal or unenforceable, and the validity, legality and
enforceability of the remainder of such provision and the remaining provisions
of this Commercial Shared-Loss Agreement shall not in any way be
affected or impaired thereby.

     

    6.8           No
Third Party Beneficiary. This Commercial
Shared-Loss Agreement
and the Exhibits hereto are for the sole and exclusive benefit of the parties
hereto and their respective permitted successors and permitted assigns and there
shall be no other third party beneficiaries, and nothing in Commercial
Shared-Loss Agreement
or the Exhibits shall be construed to grant to any other Person any right,
remedy or claim
under or in respect of this Commercial Shared-Loss Agreement or any provision
hereof.

     

    6.9           Consent. Except as otherwise provided
herein, when the consent of a party is required herein, such consent shall not
be unreasonably withheld or delayed.

     

    
      
        
           

          
            	
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    6.10    Rights
Cumulative. Except as otherwise
expressly provided herein, the rights of each of the parties under this
Commercial Shared-Loss Agreement are cumulative, may be exercised
as often as any party considers appropriate and are in addition to each such
party’s rights under the Purchase and Sale Agreement and any of the related
agreements or under law. Except as otherwise expressly provided herein, any
failure to exercise or any delay in exercising any of such rights, or any
partial or defective exercise of such rights, shall not operate as a waiver or
variation of that or any other such right.

     

    

     

     

     

    
 

    
      	
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    115Exhibit 4.78

Exhibit 4.78

STATE-OWNED CONSTRUCTION LAND USE RIGHTS GRANT CONTRACT

This Contract is entered into by and between:

	 	 	 
	Grantor:
	 	Economic-Technological Development Area Branch, Beijing
Municipal Bureau of Land and Resources, the People’s Republic
of China;

	 	 	 

	Address:
	 	Boda Plaza, No. 15 Middle Ronghua Road, Beijing
Economic-Technological Development Area

	 	 	 

	Postcode:
	 	100176

	 	 	 

	Telephone:
	 	010 — 6788 0187

	 	 	 

	Facsimile:
	 	010 — 6788 0187

	 	 	 

	Grantee:
	 	Beijing Ninetowns Software Co., Ltd.

	 	 	 

	Address:
	 	F2 Building No. 2, No. 2 North Jinyuan Road, Beijing
Economic-Technological Development Area

	 	 	 

	Postcode:
	 	100176

	 	 	 

	Telephone:
	 	010 — 6589 9846

	 	 	 

	Facsimile:
	 	010 — 6589 9000

	 	 	 

	Account Bank:
	 	Bank of Beijing, Hongxing Branch

	 	 	 

	Account:
	 	01090330400120109148269

CHAPTER 1 GENERAL PROVISIONS

Article 1 The Parties have entered into this Contract in accordance with the principles of
equality, free will, consideration and good faith, and in accordance with the Property Rights Law
of the People’s Republic of China, the Contract Law of the People’s Republic of China, the Land
Administration Law of the People’s Republic of China, the Law of the People’s Republic of China on
the Administration of Urban Real Estate and related laws, administrative regulations and land
supply policies.

Article 2 The ownership of the land use rights to be granted belongs to the People’s Republic of
China. The Grantor grants the state-owned construction land use rights as authorized by law. The
granted land use rights do not extend to underground resources and hidden treasures.

Article 3 During the grant term, the Grantee has the rights to occupy, use, benefit from and
dispose the state-owned construction land use rights acquired by it in accordance with law. The
Grantee also has the rights to construct buildings, fixtures and related facilities on the granted
plots in accordance with law.

 

 

 

CHAPTER 2 DELIVERY OF GRANTED PLOTS

AND PAYMENT OF LAND PREMIUM

Article 4
The plots granted under this Contract are Plot F2M1 and Plot F2F2 which have a total land
area of fifty eight thousand five hundred and twenty six point five eight square meters (58,526.58
m2), of which the granted area is fifty eight thousand five hundred and twenty six point
five eight square meters (58,526.58 m2). The total area of Plot F2M1 is forty four
thousand four hundred and seventy six point five seven one square meters (44,476.571 m2)
and the total area of Plot F2F2 is forty four thousand and fifty point zero zero nine square meters
(44,050.009 m2).

The
plots granted under this Contract are located at F2 Block, Ludong District, Beijing
Economic-Technological Development Area which is east to the un-granted plots at F2 Block, south to
Kechuang No. 13 Street, west to the plot that will be used by Beijing Ninetowns Import and Export
Electronic Commerce Software Co., Ltd. (north) and Jinghai No. 5 Road (south), and north to the
green land located south of Kechuang No. 12 Street. A boundary map of the granted plots is set
forth in Appendix 1 attached hereto.

Article 5 The plot granted hereunder shall be used for industrial purposes.

Article 6
The Grantor agrees to deliver the granted plots to the Grantee on the date hereof. The
Grantor agrees that, upon the delivery, the site shall be leveled with above-ground high-voltage
cables and underground high-pressure natural gas pipelines. The surrounding municipal roads have
not been constructed. Water, power and natural gas supplies, drainage and sewage pipelines and
information-based wires will be provided prior to October 31, 2009, when the surrounding municipal
roads become usable. The Grantee shall use clean energy to procure its own heat supply before the
central heating plant in Ludong District begins its heat supply.

Article 7 The term of the land use rights granted hereunder shall be fifty years, calculated from
the date of actual delivery of the land by the Grantor to the Grantee in accordance with Article 6
hereof.

Article 8 The state-owned construction land use rights grant fee for the plot hereunder shall be
Renminbi Five Hundred (RMB500) per square meter, for a total of Renminbi Twenty Nine Million Two
Hundred and Sixty Three Thousand Two Hundred and Ninety (RMB29,263,290).

Article 9 The earnest money for the land use rights grant fee shall be Renminbi Five Million Eight
Hundred and Fifty Two Thousand Six Hundred and Fifty Eight (RMB5,852,658), which shall be set off
against the land use rights grant fee.

Article 10 The Grantee agrees to pay the land use rights grant fee to the Grantor in two
installments in accordance with the following schedule:

	 	 	 	 
	 	First installment:
	 	Renminbi Six Million (RMB6,000,000), payable within ten days
after the date hereof by setting off against the earnest money;

	 	 	 

	 	Second installment:
	 	Renminbi Twenty Three Million Two Hundred and Sixty Three Thousand Two
Hundred and Ninety (RMB23,263,290), payable within one hundred and eighty days after
the date hereof.

 

2

 

In addition to the land use rights grant fee, the Grantee shall pay interest on the outstanding
amount of the land use rights grant fee at the monthly interest rate of 0.2% for the period
commencing from the sixty-first day to the one hundred and eightieth day.

Article 11 After the Grantee has fully paid the land use rights grant fee in accordance with this
Contract, the Grantee shall apply for the registration of the granted state-owned construction land
use rights by submitting this Contract, payment receipts of the land use rights grant fee and
related certification materials.

CHAPTER 3 DEVELOPMENT, CONSTRUCTION

AND UTILIZATION OF THE LAND

Article 12 The Grantee agrees that the investment of the granted plots shall be implemented in
accordance with the following provisions of this Article:

The granted plots shall be used for the purposes of industrial project construction. The Grantee
agrees that the amount of total investment in the plot shall be no less than Renminbi Three Hundred
and Ninety Million (RMB390,000,000), of which the investment in fixed assets shall be no less than
Renminbi Three Hundred and Sixty Million (RMB360,000,000). The total investment in fixed assets
hereunder includes without limitation the buildings, fixtures, auxiliary facilities, equipment
investments and land grant fee.

Article 13 Buildings, fixtures and the auxiliary facilities to be constructed by the Grantee on the
granted plots shall meet the planning requirements of the granted plots that are promulgated by the
municipal (county) planning authorities (please refer to Appendix 1 attached hereto for
details), among which:

	 	 	 
	Nature of the main building:
	 	buildings for industrial use, which can be
used compatibly as scientific research
offices or public service facility buildings;

	 	 	 

	Gross floor area:
	 	seventy two thousand five hundred and seventy
seven square meters (72,577 m2) to
one hundred and one thousand eight hundred
and forty square meters (101,840
m2) above the ground;

	 	 	 

	Plot ratio:
	 	Plot F2M1: 1.0 to1.5; Plot F2F2: 2.0 to 2.5;

	 	 	 

	Construction height limit:
	 	eighteen (18) to forty five (45) meters;

	 	 	 

	Building density:
	 	40% or less;

	 	 	 

	Green space coverage:
	 	Plot F2M1: 15% to 20%; Plot F2F2: 20%
or higher; centralized green space: no less
than 25% of the total green space.

 

3

 

Article 14 The Grantee agrees to develop the granted plots and construct ancillary facilities in
accordance with the following provisions of this Article:

The granted plots hereunder shall be used for the purposes of industrial project construction.
According to the planning and design requirements provided by the planning authorities, the area of
internal administrative offices and living service facilities shall not exceed 5% of the granted
plots area hereunder (i.e. 2,926 m2), with a floor area not exceeding 10% of the total
floor area. The Grantee agrees not to construct residential apartments, expert buildings, hotels,
guest houses, training centers and other non-operational facilities on the granted plots.

Article 15 The Grantee agrees to construct the following ancillary facilities on the granted plots
simultaneously with its own buildings, and to transfer such facilities to the government upon
completion for free: None.

Article 16 The Grantee agrees to commence construction by September 30, 2009, complete the
construction of no less than fifty thousand square meters (50,000 m2) by September 30,
2011, and complete the all construction by August 31, 2012.

If the Grantee can not commence construction on time, the Grantee shall apply to the Grantor for a
renewal at least 30 days prior to the deadline. The expected construction completion date shall be
extended accordingly, provided, however, that the renewal shall not exceed one year.

Article 17 Water supply, gas supply, sewage, and the connection of the facilities on the granted
plots with main pipelines, cables and electricity transformer substation that are located out side
of the granted plots shall be constructed and connected in accordance with relevant regulations.

The Grantee agrees that the government may lay various pipelines and cables for public utilities
in, on or through the granted plots, provided, however, that the government or the utilities
operation entities shall make reasonable compensation to the Grantee for any adverse effect on the
functions of the granted plots.

Article 18 The Grantee shall use the granted plots in accordance with the purpose and the plot
ratio specified herein without any unauthorized change. If the Grantee intends to change the
purpose of the land as set forth herein during the grant term, the Grantor will take the land use
rights back in consideration of certain consideration.

Article 19 The government reserves the right to amend the planning requirements in respect of the
granted plots hereunder. In the event of an amendment to the original zoning requirements for the
granted plots, the existing buildings on the plot shall not be affected, but if the Grantee intends
to alter or rebuild existing buildings, fixtures or other auxiliary facilities on the plots during
the term or if the Grantee applies for a renewal of the term upon expiration, the Grantee shall
comply with the planning requirements then in effect.

Article 20 The Grantor shall not take back the state-owned construction land use rights duly
obtained by the Grantee prior to the expiration of the use term provided herein. Under
extraordinary circumstances requiring premature take-back of the state-owned construction land use
rights in accordance with public interest, the Grantor shall obtain prior approval in accordance
with statutory procedures and pay compensation to the Grantee calculated according to the appraised
market value of the buildings, fixtures and auxiliary facilities on the granted plots at the time
of the take-back, the market value of the land use rights for the remaining term and the appraised
direct loss.

 

4

 

CHAPTER 4 ASSIGNMENT, LEASE AND MORTGAGE OF STATE-OWNED

CONSTRUCTION LAND USE RIGHTS

Article 21 After the Grantee has paid the entire state-owned construction land use rights grant fee
and obtained a State-Owned Land Use Certificate in accordance with this Contract, the Grantee shall
have the right to assign, lease or mortgage all or a portion of the land use rights hereunder.
However, the Grantee shall have made investment and completed at least 25% of the total development
investment in accordance with this Contract before the Grantee assign any of the land use rights
hereunder for the first time.

Article 22 Contracts for the assignment, mortgage or lease of state-owned land use rights may not
contradict laws, regulations or this Contract.

Article 23 When the state-owned construction land use rights are assigned, all rights and
obligations specified in this Contract and the registration documentation shall also be assigned
simultaneously with such state-owned land use rights. Following the assignment, the term of the
assigned state-owned construction land use rights shall be the remainder of the term hereunder.

Following the lease of all or a portion of the state-owned construction land use rights hereunder,
the rights and obligations specified in this Contract and the registration documentation shall
remain with the Grantee.

Article 24 When the state-owned construction land use rights are assigned, leased or mortgaged, the
parties to the assignment, lease or mortgage shall submit this Contract, related assignment or
mortgage agreement and the State-Owned Land Use Certificate to the state-owned land resources
administrative bureau for a land change registration.

CHAPTER 5 EXPIRATION OF THE TERM

Article 25 If the Grantee intends to continue using the granted plots after the expiration of the
use term, the Grantee shall submit a renewal application the Grantor at least one year prior to the
expiration of the term, and the Grantor shall approve such application unless the Grantor is
obligated to take back the land for public interest.

If the Grantor agrees to a renewal, the Grantee shall complete necessary procedures for land use
rights grant, lease or other uses of the plots for a consideration, execute relevant contracts and
pay the grant fee, rental or other consideration for the use of the land.

Article 26 If, upon the expiration of the land grant term, the Grantee has applied for a renewal
but such application is not approved due to public interest, the Grantee shall return the
State-Owned Land Use Certificate and complete procedures for deregistration of the state-owned
construction land use rights in accordance with laws and regulations. The Grantor shall take back
the state-owned construction land use rights without any compensation. The Grantor and the Grantee
agree that the Grantor is entitled to acquire the buildings, fixtures and auxiliary facilities on
the granted plots, provided, however, that the Grantor shall compensate the Grantee for the
buildings, fixtures and auxiliary facilities on the granted plots according to the residual value
thereof as at the time of the take-back.

 

5

 

Article 27 If, upon the expiration of the land grant term, the Grantee does not apply for a
renewal, the Grantee shall return the State-Owned Land Use Certificate and complete procedures for
deregistration of the state-owned construction land use rights in accordance with laws and
regulations. The Grantor shall take back the state-owned construction land use rights without any
compensation. The buildings, fixtures and auxiliary facilities on the granted plots shall belong
to the Grantor without compensation. The Grantee shall maintain the normal functions of the
buildings, fixtures and auxiliary facilities on the granted plots and shall not damage them
intestinally. If buildings, fixtures and auxiliary facilities on the granted plots cease to be
normally usable, the Grantor may require the Grantee to remove or demolish such buildings, fixtures
and facilities and to re-level the site.

CHAPTER 6 FORCE MAJEURE

Article 28 Neither party shall be liable for such party’s failure to perform all or any portion of
this Contract due to a force majeure event, provided, however, that the affected party shall take
all necessary measures to mitigate the loss arising from such force majeure event to the extent
possible. Neither party shall be exempted from any liability arising from a force majeure event
that occurs during such affected party’s late performance.

Article 29 A party affected by a force majeure event shall give the other party a written notice of
the occurrence of the force majeure event by mail, telegram, facsimile or other methods within 7
days after the occurrence of such force majeure event, and shall deliver a report and evidential
documents to the other party within 15 days after the occurrence of the event, setting forth the
fact that such party can not perform or needs additional time to perform all or a portion of this
Contract.

CHAPTER 7 LIABILITY FOR BREACH OF CONTRACT

Article 30 The Grantee shall pay the state-owned construction land use rights grant fee on time in
accordance with this Contract. If the Grantee fails to pay such grant fee on time, the Grantee
shall pay a late-payment fine to the Grantor calculated at 0.1% of the overdue amount for each day
overdue. In the event that any payment is due and outstanding for more than 60 days, and no
payment is made after the Grantor’s claim, the Grantor shall have the right to terminate this
Contract, foreclose the earnest money and claim compensation from the Grantee for losses caused by
the breach.

Article 31 If the Grantee, for its own reasons, intends to terminate its investment in and
construction of the projects on the granted plots and applies to the Grantor to terminate this
Contract and return the granted land use rights, the Grantor shall, after the Grantor obtains a
approval on such termination by the people’s government that originally approved the land grant,
repay (without interest) all or a portion of the state-owned construction land use rights grant fee
(excluding the earnest money hereunder) to the Grantee, and take back such state-owned construction
land use rights in accordance with the provisions set forth below; provided, however, that no
compensation shall be provided for the buildings, fixtures and their auxiliary facilities already
constructed on the plots and the Grantor may require the Grantee to demolish such buildings,
fixtures and facilities and to re-level the site; provided, further, that if the Grantor desires to
preserve and use of such buildings, fixtures and facilities, the Grantor shall compensate the
Grantee for such buildings, fixtures and facilities.

 

6

 

	(1)	 	If the Grantee submits its application to the Grantor at least 60 days prior to the one-year
anniversary of the construction commencement date as set forth herein, the Grantor shall repay
the state-owned construction land use rights grant fee that has been paid by the Grantee, less
the earnest money as provided hereunder.

	(2)	 	If the Grantee submits its application to the Grantor after the one-year anniversary of the
construction commencement date but at least 60 days prior to the two-year anniversary of the
construction commencement date as set forth herein, the Grantor shall repay the state-owned
construction land use rights grant fee that has been paid by the Grantee, less the earnest
money as provided hereunder and a idle plots fee in accordance with laws and regulations.

Article 32 If the Grantee keeps the land idle for more than one year but less than two years, the
Grantee shall pay an idle plots fee in accordance with law. If the land remains idle for more than
two years without any construction, the Grantor has the right to take back the state-owned
construction land use rights without any compensation.

Article 33 If the Grantee fails to commence the development and construction by the date as set
forth herein or such other date as may be agreed upon in the event of a renewal, the Grantee shall
pay liquidated damages equal to 0.1% of the total amount of the state-owned construction land use
rights grant fee for each day overdue to the Grantor. The Grantor has the right to require the
Grantee to continue its performance of this Contract.

If the Grantee fails to complete the construction by the date as set forth herein or such other
date as may be agreed upon in the event of a renewal, the Grantee shall pay liquidated damages
equal to 0.1% of the total amount of the state-owned construction land use rights grant fee for
each day overdue to the Grantor.

Article 34 If the total investment amount or the fixed assets investment amount fails to reach the
criteria as set forth herein, the Grantor may require the Grantee to pay liquidated damages
calculated by: (i) the total grant fee, (ii) times the difference between the total investment
amount or the fixed assets investment amount as contemplated hereunder and the actual investment
amount or the actual fixed assets investment amount (as the case may be), and (iii) divided by the
total investment amount or the fixed assets investment amount (as the case may be). The Grantor
may require the Grantee to continue its performance of this Contract.

Article 35 If any of the plot ratio, building density or any other target of the plots is lower
than the minimum target as contemplated hereunder, the Grantor may require the Grantee to pay
liquidated damages calculated by: (i) the total grant fee, (ii) times the difference between the
contemplated target and the actual target, and (iii) divided by the contemplated target. If any of
the plot ratio, building density or any other target of the plots is higher than the maximum target
as contemplated hereunder, the Grantor shall have the right to obtain the title to the floor area
that is in excess of the maximum target as contemplated hereunder without any compensation, and the
Grantor shall have the right to require the Grantee to pay liquidated damages calculated by: (i)
the total grant fee, (ii) times the difference between the contemplated target and the actual
target, and (iii) divided by the contemplated target.

 

7

 

Article 36 If the industrial construction project’s green space coverage ratio, the proportion of
the land used for internal administration office and living service facilities, the gross floor
area of the internal administration office and living service facilities or any other similar
target exceeds the target as contemplated hereunder, the Grantee shall pay liquidated damages equal
to 0.1% of the state-owned construction land use rights grant fee to the Grantor and shall remove
and demolish the green space and improvements exceeding such targets.

Article 37 If the Grantee pays the state-owned construction land use rights grant fee in accordance
with this Contract, the Grantor shall deliver the granted plots on time in accordance with this
Contract. If the Grantee’s taking possession of the plots hereunder is delayed due to the
Grantor’s failure to deliver the granted plots on time, the Grantor shall pay liquidated damages
equal to 0.1% of the paid-in state-owned construction land use rights grant fee for each day
overdue to the Grantee. The land use term shall commence on the date of the actual delivery of the
plots. If the Grantor’s delivery of the land becomes overdue for more than 60 days and the Grantor
fails to deliver the land after the Grantee’s claim, the Grantee shall have the right to terminate
this Contract and the Grantor shall repay the earnest money in double to the Grantee and shall
repay the remaining amount of the paid-in state-owned construction land use rights grant fee. The
Grantee may claim against the Grantor for other losses arising from the breach.

Article 38 If (i) the Grantor fails to deliver the land as scheduled, (ii) the land delivered by
the Grantor fails to satisfy the land conditions as set forth herein or (iii) the Grantor
unilaterally changed the land use conditions, the Grantee shall have the right to require the
Grantor to perform its obligations hereunder and indemnify the Grantee for direct losses suffered
by the Grantee arising from such performance delay. The land use term shall be calculated
commencing from the date on which the land conditions as set forth herein are satisfied.

CHAPTER 8 GOVERNING LAW AND RESOLUTION OF DISPUTES

Article 39 The conclusion, validity, interpretation and performance of this Contract and dispute
resolution in connection with this Contract shall all be governed by the laws of the People’s
Republic of China.

Article 40 Any dispute arising from the performance hereof shall be resolved through consultations
between the parties. If the parties fail to resolve any dispute through consultations, the parties
may submit such dispute to a people’s court to resolve in accordance with laws and regulations.

CHAPTER 9 MISCELLANEOUS

Article 41 The grant plan of the granted plots hereunder has been approved by the Administration
Committee of Beijing Economic-Technological Development Area. This Contract shall take effect upon
execution by the parties.

Article 42 Each party hereto represents and warrants that the name, correspondence address,
telephone number, facsimile number, bank, agent and other information in this Contract are true and
effective. If a party changes any of such information, it shall notify the other party in writing
within 15 days after the change, otherwise, such party shall be responsible for liabilities arising
from the other party’s failure to give notices to such party.

 

8

 

Article 43 This Contract has 19 pages including the appendices. The Chinese version shall prevail.

Article 44 The prices, amounts, floor areas and other numeric information are set forth in both
words and figures. The expressions in words and in figures shall be consistent with each other.
In the event of any discrepancy between the words and the figures, the number expressed in words
shall prevail.

Article 45 Any matters not fully covered herein may be addressed by the parties and attached hereto
as appendices upon the parties’ agreement thereon. Such appendices shall have the same force and
effect as this Contract.

Article 46 This Contract is made in five counterparts. The Grantor and the Grantee shall each hold
two counterparts and Beijing Municipal Bureau of Land and Resources shall hold the remaining one
counterpart. All counterparts shall have the same force and effect.

	 	 	 	 	 
	Grantor (affix seal):

	 	Grantee (affix seal):	 	 
	 
	 	 	 	 
	Legal representative 

(Authorized
Representative)

	 	Legal representative 

(Authorized Representative)	 	 
	 
	 	 	 	 
	(signature):

	 	(signature):	 	 
	 
	 	 	 	 
	/s/
 

	 	/s/
 

	 	 
	 
	 	 	 	 
	 

	 	Date: October 30, 2008	 	 

 

9

 

Appendix I. Planning Opinion Letter

Urban Planning Commission of Beijing Municipality

Planning Opinion Letter (Conditions)

2008 Gui (Kai) Yi Tiao Zi No. 0024

Date of Issuance: April 2, 2008

			
		 	

To: Economic-Technological Development Area Branch, Beijing Municipal Bureau of Land
and Resources

Your
application materials submitted on April 1, 2008 regarding the project of comprehensive
scientific research and outsourced services industries contemplated to be planned and constructed
on Plot F2M1 and Plot F2F2, Ludong District, Beijing Economic-Technological Development Area have
been received. After review, pursuant to the provisions of relevant laws, regulations, rules and
urban planning requirements and such relevant materials submitted, we hereby grant approval for you
to start the preliminary works of the project design and planning in accordance with the following
planning (conditions) opinion and the scope of land plot shown in the attached map.

	•	 	Land Planning Requirements:

	 	•	 	Contemplated location and scope of the planning construction land: Plot F2F2 and
Plot F2M1, Ludong District, Beijing Economic-Technological Development Area (please refer
to the map attached for details)

	 	•	 	Contemplated planned use purpose of the construction land: multi-functions (F) and
industrial land (M)

	 	•	 	Total land area: 58,513 square meters

	 	•	 	Total construction land area: 58,513 square meters, including 14,047 square meters
for Plot F2F2 and 44,466 square meters for Plot F2M1 (The precise figure shall be
determined based on the result of the land boundary markers.)

Industrial land area: 58,513 square meters

	 	•	 	Plot ratio: 2.0 to 2.5 for Plot F2F2 and 1.0 to 1.5 for Plot F2M1

	 
	 	•	 	Building density: ≤ 40%

	•	 	Building Planning Requirements:

	 	•	 	Construction land area of the project: 58,513 square meters

	 
	 	•	 	Building use purpose: industrial buildings

	 
	 	•	 	Compatible uses: scientific research offices and public service facility buildings

 

1

 

	 	•	 	Controlled building scale: 72,560 square meters ≤ controlled building scale ≤
101,816 square meters for above-ground floor area

	 	•	 	Controlled building height: 18 meters ≤ controlled building height ≤ 45 meters (for
the site’s controlled height.)

	 	•	 	Controlled number of stories shall be in accordance with controlled building height

	 	•	 	Building setback distance: In addition to the following planning requirements, the
building setback distance shall be in compliance with environmental protection, fire
protection, public security requirements and other professional opinions. The setback
distance for the main entrance of the site shall be at least 4 meters.

	 	•	 	Minimum setback distance from boundary lines: the buildings’ minimum setback
distance from the east red lines of the plots shall be 13 meters (including
8-meter wide public routes). The buildings’ minimum setback distance from the
green space along Kechuang No. 12 Street shall be 21 meters (including 16-meter
wide public routes)

	 
	 	•	 	Minimum setback distance from road red lines: the building’s minimum setback
distance from the north red lines along Kechuang No. 13 Street shall be 3 meters,
and the building’s minimum setback distance from the east red lines along Jinghai
No. 5 Road shall be 10 meters.

	 	•	 	Buildings interval shall be in compliance with related laws, regulations and rules.

	 	•	 	The requirements of the Provisional Regulations on the Residential Buildings
Interval of Beijing Municipality shall be satisfied.

	 	•	 	Vertical design: The vertical design of the site shall be made according to the
height of the building near the red lines of the plots to the extent that the transition
of the height of the buildings near the red lines is smooth.

	•	 	Environmental Design Requirements:

	 	•	 	Relationship with neighboring buildings: the roofs of the buildings shall be paved
with bright and colorful materials, taking into consideration of the overall city view.

	 	•	 	Building external walls (colors and design): It is important that the exterior
design of the buildings is made carefully and it is encouraged to use multiple measures
to enrich environmental effects, reflecting features of the era. The main color of the
buildings shall not be white color to the extent possible. The external air conditioners
and cooling towers shall be concealed with effective measures and be reasonably
compatible with the building design.

 

2

 

	 	•	 	Outdoor square: No walls of any kind shall be constructed along Kechuang No. 13
Street and Paiganqu West Road. The ground floor of all buildings that are located by
public streets shall be open to the public.

	 	•	 	Other requirements: No bricklaying wall or pillar shall be constructed along the
south boundary of the north public route, the west boundary of the east public
route and east red line of Jinghai No. 5 Road, but green belts or pierced walls may be
built according to actual needs. The height of the walls shall not be more than 1.6
meters.

	•	 	Greenery and Environmental Planning Requirements:

	 	•	 	Greening ratio: Plot F2F2 ≥  20 and 15% ≤ greening ratio for Plot F2M1 ≤ 20%. The
area of solid soil green space may be calculated into the greening ratio. The area
within 1.5 meters against buildings and 1.0 meter against roads shall not be calculated
into the greening ratio.

	 	•	 	Centralized green space: the centralized green space shall be no less than 25% of
the total green space.

	•	 	Transportation Planning Requirements:

	 	•	 	Main entrance/exit locations connecting the transportation of the project with the
outside: two entrances shall be set on each of Jinghai No.5 Rad and the east public
route, which shall be set strictly in compliance with the layout plan

	 	•	 	Motor vehicle flow: one entrance may be set on each of Kechuang No.13 Street
and the north public route (no compulsory requirements). The entrances shall be
located at least 80 meters from the infalls of the red lines of the main roads.

	 
	 	•	 	Non-motor vehicle flow: the entrances for non-motor vehicle flow may be the
same as the motor vehicle flow. Traffic management shall be handled properly.

	 
	 	•	 	Pedestrians: the entrances for pedestrians may be properly set at the public
space near Kechuang No.13 Street and public routes.

	 	•	 	Parking lots: all parking lots and facilities shall be permanent and no temporary
parking lot is allowed.

	 	•	 	Motor vehicle: the minimum requirement for the office area is 65 Parking lots
per 10,000 square meters. The number of above-ground parking lots shall be less
than 10% of the total number of parking lots.

	 	•	 	Bicycles: concealed parking lots for bicycles shall be properly set, and the
parking lots for bicycles shall not affect the view of the site or the city.

	 	•	 	Traffic management: the traffic flow shall be one-way circle. The traffic
management for the public route shall meet the traffic administrative authorities’
requirements.

 

3

 

	•	 	Municipal Public Utilities Planning Requirements:

	 	•	 	Others: these opinions do not address the locations for the connections of public
utilities, which will be provided after the completion of the detailed design of the
municipal public infrastructure.

	•	 	Notification of Relevant Requirements:

	 	•	 	After obtaining the Planning Opinion Letter (Conditions) concerning the project,
relevant matters such as bid invitation and submission registration of survey and design
shall be conducted in accordance with the law.

	 	•	 	Where the project requires civil defense construction in accordance with the law,
examination opinion from the relevant civil air defense authority shall be obtained.

	 	•	 	Where the project falls within the restricted and controlled area of old-city or
cultural relics protection, examination opinion from the relevant cultural relics
protection authority shall be obtained.

	•	 	Miscellaneous:

	 	•	 	1. The application documents shall include at least two set of plans, environmental
effect drawings and their digital copies, including nearby approved projects. Two sets
of the application documents shall be submitted;

2. The parking lots shall be set according to the greening parking lots standards. One
parking lots group shall have two parking lots. 1 meter strip green belt shall be set
between each parking lots group, planting deep-rooted arbors with distance between
arbors less than 6 X 6 meters. The parking lots shall be paved with nonwatertight
materials.

3. The design shall address the plan for the construction of rainwater utilization
facilities, energy-saving and environmental protection measures and barrier-free
facilities.

4. The applicant shall apply for a geographic name (building name approval) if a project
name will be used.

5. No bricklaying wall or pillar shall be constructed and the height of the walls shall
be less than 1.6 meters, calculated from the planned height of the red lines of the
plots.

6. Attachments to these opinions: Municipal Design Guidelines for Plot F2F2 and F2M1, F2
Block, Ludong District (as planning design guidelines).

7. The targets and criteria for the plots as set forth in these opinions may be balanced
according to the comprehensive development of the plots.

 

4

 

	•	 	Special Reminder:

Before applying for the construction-related permit, the construction entity is required to
take relevant actions:

	•	 	Before applying for the construction-related permit, the construction entity is required to
take relevant actions:

	 	•	 	If the construction project is required to proceed with survey and design bid
invitation in accordance with law, the planning authorities will examine the wining design plan
against planning technical indicators in accordance with law. Applications for design plan
planning technical indicator examination and approval shall be submitted to the service hall of
Municipal Planning Bureau, together with the following documents:

	 	•	 	Application Form of Construction Project Planning Permit and Other Matters
completely filled-in by the construction entity and affixed with the company seal.

	 	•	 	Photocopies of Schedules to Planning Opinion Letter (Conditions) (including
drawings) and other relevant documents that are required for the application for design
plan planning technical indicator examination and approval.

	 	•	 	Copies of the Form of Beijing Municipality Bid Invitation and Submission
Registration of Survey and Design with signed opinions and the Notice of Winning the
Bidding of Survey and Design.

	 	•	 	Two sets of planning design plan drawings prepared by qualified design entities in
accordance with the requirements set forth in the Schedules to Planning Opinion Letter
(Conditions), together with 5 copies of master design plan, which shall be bound in A3
specifications (landscape) or in A4 specifications (vertical).

[The master design plan shall be blue print based on base map of actually measured
relief map, marked with economic and technical indicators and description of
barrier-free facilities design. The measuring scale of a single building design plan
shall be 1:500, the measuring scale of the residential area design plan shall be
1:1,000, and one copy for each of the floor layout, solid drawings and section drawings
for material components (measuring scale shall be 1:100 or 1:200).]

	 	•	 	Where the name of the project falls within the scope of a geographical name or
where a building name needs to be used, naming documents of the geographical name or
approval documents of the building name issued by the relevant geographical name
administrative authority shall be submitted.

	 	•	 	Construction projects that are not required to proceed with bid invitation in
accordance with law may apply for planning design plan examination. Applications for design
plan examination and approval shall be submitted to the service hall of Economic-Technological
Development Area Planning Bureau, together with the following documents:

	 	•	 	Application Form of Construction Project Planning Permit and Other Matters
completely filled-in by the construction entity and affixed with the company seal.

 

5

 

	 	•	 	Photocopies of Schedules to Planning Opinion Letter (Conditions) (including
drawings) and other relevant documents that are required for the application for design
plan examination and approval.

	 	•	 	Copies of the Form of Beijing Municipality Bid Invitation and Submission
Registration of Survey and Design with signed opinions.

	 	•	 	Two sets of planning design plan drawings prepared by qualified design entities in
accordance with the requirements set forth in the Schedules to Planning Opinion Letter
(Conditions), together with 5 copies of master design plan, which shall be bound in A3
specifications (landscape) or in A4 specifications (vertical).

[The master design plan shall be blue print based on base map of actually measured
relief map, marked with economic and technical indicators and description of
barrier-free facilities design. The measuring scale of a single building design plan
shall be 1:500, the measuring scale of the residential area design plan shall be
1:1,000, and one copy for each of the floor layout, solid drawings and section drawings
for material components (measuring scale shall be 1:100 or 1:200).]

	 	•	 	Where the name of the project falls within the scope of a geographical name or
where a building name needs to be used, naming documents of the geographical name or
approval documents of the building name issued by the relevant geographical name
administrative authority shall be submitted.

	 	•	 	When applying for the Construction Project Planning Permit, please submit the
following relevant applications to the service hall of Economic-Technological Development Area
Planning Bureau:

	 	•	 	letter of authorization for application issued by the construction entity.

	 	•	 	Application Form of Construction Project Planning Permit and Other Matters
completely filled-in by the construction entity and affixed with the company seal.

	 	•	 	project approval, filing or annual construction plan documents from the
construction planning administrative authorities (Development and Reform Commission,
Construction Commission) within the valid term.

	 	•	 	copy of the Planning Opinion Letter (Conditions) (including the attached map).

	 	•	 	copy of the Form of Beijing Municipality Bid Invitation and Submission Registration
of Survey and Design with signed opinion. Where the invitation of bids is clearly needed
for the construction, the Notice of Winning the Bidding of Survey and Design shall be
submitted simultaneously.

	 	•	 	one set of construction drawings prepared by the qualified design entity according
to the requirements of planning design examination opinion or planning opinion, together
with 5 copies of master design plan (4 copies for confidential project), binding in A4
specifications in vertical.

 

6

 

[The construction drawings shall include: contents of maps, design statements of barrier-free
facilities, master design plan, floor plan of each floor, sectional maps, maps of elevation in all
directions, sectional maps of each main part, foundation plans, foundation sectional maps, each in
one copy]

	 	•	 	Where the construction completion archives are required to be registered in
accordance with the law, original first copy of the Registration Form of Municipal
Construction Project Completion Archives shall be submitted.

	 	•	 	Where the design plan has been reviewed and examined, the documents of design plan
examination opinion shall be submitted. For those projects that do not require a design
plan review and examination, literal opinion materials issued by relevant authorities
involved (such as civil prevention, cultural relics, etc.) shall be submitted in
accordance with the relevant requirements set forth in the planning opinion documents
(Reply Approval on Planning Opinion, Planning Opinion Letter (Conditions), etc.).

	 	•	 	Where the name of the project falls within the scope of a geographical name or
where a building name needs to be used, naming documents of the geographical name or
approval documents of the building name issued by the relevant geographical name
administrative authority shall be submitted.

	 	•	 	With respect to the residential projects that do not fall within the scope of the
newly approved and newly commenced projects on June 1, 2006, copies of prior Project
Construction Work Permit of such residential projects shall be submitted.

	 	•	 	With respect to those residential projects that have been carried out pursuant to
the Schedules to Planning Opinion Letter (Conditions) issued after March 1, 2007,
residential area construction plan shall be submitted.

Notifications:

1. The Planning Opinion Letter (Conditions) shall only apply for the construction projects
filed by an entity (individual) that has obtained land use rights on its own behalf.

2. The Planning Opinion Letter (Conditions) shall be valid for a term of two years, serving as
the basis to apply to the relevant construction planning administrative authority for construction
project approval (examination and approval, filing). If the preliminary approval (examination and
approval, filing) of the project from the relevant construction planning administrative authority
has been obtained within two years, the valid term of the Planning Opinion Letter (Conditions) can
then be extended and shall be valid for the same term as that of the construction planning approval
(examination and approval, filing) document. Upon expiration, such term can not be extended any
more and shall become invalid automatically.

3. Construction entities shall appoint design entities with corresponding qualifications to
conduct the planning design in accordance with the requirements of the Planning Opinion Letter
(Conditions) and relevant laws, regulations, specifications and standards. After obtaining the
planning opinion, the construction entities shall conduct bid invitation and submission
registration of survey and design and relevant matters in accordance with the Regulations on
Standards of Scope and Scale of Construction Project Bidding and Regulations of Beijing
Municipality on Standards of Scope and Scale of Construction Project Bidding (Beijing Municipal
People’s Government Order No. 89).

 

7

 

4. Residential projects shall be equipped with ancillary public service facilities in
accordance with the Planning Design Index of Residential Public Service Facilities in Beijing
Municipality (Shi Gui Fa [2006] No. 384). The municipal public infrastructure and public
service facilities shall be constructed and delivered for use on a simultaneous basis with the
residential buildings in accordance with Beijing Municipal Provisional Measures on Administration
of Simultaneous Delivery for Use of Residential and Municipal Public Infrastructure and Public
Service Facilities of Newly Constructed Commodity Residential Quarter (Jing Jian Fa [2007] No. 99).

5. Naming of Geographical Name

When the entity applies for the Construction Project Planning Permit, where the construction
project name of a residential area (residential quarter, residential group) is required, the
administrative approval document of relevant geographical name shall be obtained in accordance with
the relevant regulations on naming of the geographical name before applying for the Construction
Project Planning Permit.

When the entity applies for the Construction Planning Permit, where the building name of the
construction project is required, the administrative approval document of relevant geographical
name (approval of building name) shall be obtained in accordance with the relevant regulations on
naming of the geographical name before applying for the Construction Project Planning Permit.

6. The Planning Opinion Letter (Conditions) (including the attached map) shall be in three
originals (including one copy to the relevant construction planning administrative authority) and
shall only be valid with text and maps together.

7. The Planning Opinion Letter (Conditions) (draft) (including the attached map) shall be
incorporated into the Construction Project Planning Permit (draft).

 

8

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