NOTEHOLDER FORBEARANCE AGREEMENT

Exhibit 10.1

NOTEHOLDER FORBEARANCE AGREEMENT

NOTEHOLDER FORBEARANCE AGREEMENT (this “ Agreement ”), dated as of August 14, 2009, among (i) National Consumer Cooperative Bank (d/b/a NCB), a banking corporation chartered pursuant to the National Consumer Cooperative Bank Act, as amended 12 U.S.C. §§3001-3051 (the “ Company ”), (ii) NCB Financial Corporation, as Guarantor (the “ Guarantor ”) and (iii) the undersigned holders (the “ Noteholders ”) of the Notes (as defined below).

RECITALS:

A.  Pursuant to that certain Note Purchase and Uncommitted Master Shelf Agreement, dated as of December 28, 2001, among the Company and each of the Purchasers identified therein, as amended by that certain First Amendment, dated as of December 9, 2003, that certain Second Amendment, dated as of December 28, 2004, that certain Third Amendment, dated as of December 28, 2006, that certain Fourth Amendment, dated as of December 31, 2007, that certain Fifth Amendment, dated as of February 25, 2008 and that certain Sixth Amendment and Limited Waiver (the “ Sixth Amendment ”), dated as of March 31, 2009 (as so amended and in effect on the date hereof, the “ Note Agreement ”), the Company issued (i) $55,000,000 in original principal amount of its 8.50% Senior Notes, due December 28, 2009 (as amended, restated, supplemented, replaced or otherwise modified hereby or from time to time, collectively, the “ 2009 Notes ”) and (ii) $50,000,000 in original principal amount of its 8.50% Senior Notes, due December 15, 2010 (as amended, restated, supplemented, replaced or otherwise modified hereby or from time to time, collectively, the “ 2010 Notes ” and, together with the 2009 Notes, the “ Notes ”). The Noteholders hold 100% of the principal amount of the Notes.

B.  The Company entered into that certain Credit Agreement, dated as of May 1, 2006 (as previously amended and in effect on the date hereof, the “ Credit Agreement ”),by and among the Company, SunTrust Bank, as administrative agent (in such capacity, the “ Bank Agent ”), and the lenders party thereto (collectively, the “ Lenders ”).

C.  In connection with the Sixth Amendment and the corresponding amendment to the Credit Agreement, (i) the Company, the Guarantor, SunTrust Bank, as collateral agent (in such capacity, the “ Collateral Agent ”), the Lenders, the Bank Agent and the Noteholders entered into that certain Intercreditor and Collateral Agency Agreement, dated as of April 30, 2009 (as amended, the “ Intercreditor Agreement ”) and (ii) the Guarantor entered into that certain Guaranty Agreement (the “ Guaranty Agreement ”), dated as of April 30, 2009, in favor of the Collateral Agent, for the benefit of the Lenders and the Noteholders, to guaranty the Notes and the obligations of the Company under the Credit Agreement.

D.  The Company has informed the Noteholders that (i) it is in breach of (a) Section 6Q of the Note Agreement (Asset Quality) beginning May 31, 2009, (b) Section 6H of the Note Agreement (Consolidated Earnings Available for Fixed Charges) beginning June 30, 2009 and (c) Section 6R of the Note Agreement (Return on Average Assets) beginning June 30, 2009 and as a result thereof Events of Default under Section 7A(iii) occurred and are continuing on the date hereof, (ii) it is in breach of (a) Section 5Q (Minimum Liquidity Amount) beginning June 15, 2009 and (b) Sections 5H(vii) and (viii) (Notice of Event of Default and Notice of Claimed Default), in each case in respect of the Events of Default specified in this paragraph, and as a result thereof Events of Default under Section 7A(iv) occurred and are continuing on the date hereof, and (iii) as a result of the Corresponding Defaults (as defined below) an Event of Default under Section 7A(vi) of the Note Agreement has occurred and is continuing on the date hereof (collectively, the “ Specified Defaults ”).

E.  The Company has requested that the Noteholders temporarily forbear from exercising any rights or remedies that the Noteholders may have under, or in respect of, the Notes and the Note Agreement with respect to the Specified Defaults upon the terms and conditions set forth in this Agreement.

F.  The Company has requested that the Bank Agent and the Lenders temporarily forbear from exercising any rights or remedies that the Bank Agent and the Lenders may have under, or in respect of, the Credit Agreement with respect to any defaults or events of default that have arisen, or may arise, as a result of the Company’s breach of (i) section 6.9(e) of the Credit Agreement (Asset Quality) beginning May 31, 2009, (ii) sections 6.9(b), (c) and (g) of the Credit Agreement (Fixed Charge Coverage Ratio, Consolidated Debt to Consolidated Adjusted Net Worth and Return on Average Assets, respectively), in each case beginning June 30, 2009, (iii) section 6.7(a) (Notice) in respect of the breaches specified in this paragraph and (iv) section 8.5 of the Credit Agreement (collectively, the “ Corresponding Defaults ”), and the Bank Agent and the Lenders have agreed to do so as is more particularly set forth in the Forbearance Agreement among the Bank Agent, the Lenders and the Company, dated as of August 14, 2009, in substantially the form attached hereto as Exhibit A (the “ Bank Forbearance Agreement ”).

G.  Subject to the terms and conditions hereinafter set forth, the Noteholders have agreed to the Company’s request to temporarily suspend action in respect of the Specified Defaults.

AGREEMENT:

NOW THEREFORE, for valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto agree as follows:

SECTION 1. DEFINED TERMS .

1.1 Defined Terms . As used herein, the following terms shall have the meanings set forth below. The terms used herein and not defined herein shall have the respective meanings ascribed to such terms in the Note Agreement or the Notes, as applicable.

“Applicable Rate” — means 13.50% per annum, provided that during any Investment Rated Period the Applicable Rate shall be 11.50% per annum.

“Forbearance Period” — means the period from and after the Effective Date until the Forbearance Termination Date.

“Forbearance Termination Date” — means the earlier to occur of (a) 5:00 p.m. (New York time) on November 16, 2009, (b) the date of the first occurrence of any Forbearance Termination Event, and (c) the execution and delivery of an amendment and waiver agreement by and among the Company and the Noteholders, on terms and conditions satisfactory to the Noteholders, which agreement includes a permanent waiver of the Specified Defaults and any other existing Events of Default.

“Forbearance Termination Event” — means the occurrence of any of the following:

(a) the failure by the Company or its Subsidiaries, as applicable, to comply with any of the terms and provisions set forth in this Agreement or, to the extent not superseded by this Agreement, the Note Agreement;

(b) the failure of any representation or warranty in Section 3 to be true and correct, in all material respects;

(c) any Event of Default (other than a Specified Default) shall exist or occur;

(d) (i) the termination of the Credit Agreement; (ii) the failure by a Lender to renew a letter of credit in accordance with the terms of the Credit Agreement; (iii) the termination or reduction after the date hereof of any of the credit commitments under the Credit Agreement other than reductions resulting from a mandatory prepayment required pursuant to Section 4.4 herein or similar provision of the Bank Forbearance Agreement or as contemplated by the Credit Agreement; (iv) the termination of the Bank Forbearance Agreement or the forbearance represented thereby; or (v) any remedies or enforcement action taken in respect of the Credit Agreement, the Bank Forbearance Agreement or otherwise; and

(e) any payment of principal by the Company or any of its Subsidiaries in respect of any Debt that is expressly subordinated in any manner to the Notes.

“Noteholders’ Financial Advisor” — means Alvarez & Marsal North America, LLC or such other financial advisor that the Required Holders shall designate from time to time.

“Noteholders’ Professionals” — is defined in Section 4.1 hereof.

“Retainer Letters” — means collectively, (a) the retainer letter dated August 4, 2009, signed by Special Counsel and countersigned by the Company, (b) the retainer letter dated August 7, 2009, signed by the Noteholders’ Financial Advisor and countersigned by the Company and Special Counsel and (c) such other retainer letters as may hereinafter be signed by one of the Noteholders’ Professionals and countersigned by the Company in respect of fees and expenses payable by the Company in accordance with the Note Agreement, the Notes and this Agreement.

“Special Counsel” — means Bingham McCutchen LLP or such other law firm as the Required Holders may designate from time to time.

1.2 Rules of Construction . All definitions contained in this Agreement are equally applicable to the singular and plural forms of the terms defined. The words “hereof,” “herein,” and “hereunder” and words of similar import referring to this Agreement refer to this Agreement as a whole and not to any particular provision of this Agreement. Unless otherwise specified, all Section references pertain to this Agreement. All accounting terms not specifically defined herein shall be construed in accordance with generally accepted accounting principles as in effect on the Effective Date. All references herein to “this Agreement” or to any other agreement or document shall, unless stated otherwise, be deemed to refer to this Agreement or such other agreement or document as the same may be amended, restated or otherwise modified from time to time. Notwithstanding the foregoing, all provisions of the Credit Agreement and the Bank Forbearance Agreement that are incorporated herein by reference or referred to herein in order to establish obligations of the Company shall constitute reference to such provisions as in effect on the date hereof, without regard to any amendments, modifications or waivers in respect thereof that the parties to the Credit Agreement or the Bank Forbearance Agreement may agree to that are prohibited hereunder, unless the Required Holders also agree to such amendments, modifications or waivers. All references herein to sections or clauses of any other agreement or document shall, unless the context otherwise requires, be deemed to refer to such sections as they may be renumbered from time to time in connection with any amendment of the type referred to in the immediately preceding sentence of this Section. All references herein to any person shall be deemed to refer to such person and its lawful successors and assigns.

SECTION 2. FORBEARANCE.

2.1 Forbearance Period. During the Forbearance Period, the Noteholders shall not exercise or enforce any remedy against the Company or the Guarantor arising solely out of, or resulting solely from, the Specified Defaults. Upon the termination or expiration of the Forbearance Period, the Noteholders shall be entitled to exercise all of their rights and remedies, including, without limitation, those arising under this Agreement and each Transaction Document, or at law or equity. Nothing herein constitutes a waiver of the Specified Defaults or a waiver of any requirement that the Company or the Guarantor pay the amounts owing in respect of the Notes and the Note Agreement except as expressly set forth herein, and the Company acknowledges that no Noteholder has committed to waive the Specified Defaults, any other Defaults or Events of Default, or any payments required under the Notes or the Note Agreement, nor shall any Noteholder be obligated to forbear from exercising any remedies with respect to the Specified Defaults following the expiration or termination of the Forbearance Period. In addition, notwithstanding any provision of this Agreement, none of the Noteholders is restricted from asserting any action or position in any insolvency proceeding involving the Company or the Guarantor, specifically including, without otherwise limiting, any pending or future proceeding under Title 11 of the United States Code. Each of the parties hereto acknowledges and agrees that (x) from and after the termination of the Forbearance Period, the Notes shall accrue interest at the Applicable Rate, and (y) on and after the Forbearance Termination Date the Specified Defaults are, and shall continue to remain, outstanding under the Note Agreement unless otherwise expressly waived in writing by the Required Holders. The Noteholders reserve their respective rights, in their discretion, to exercise any or all of their rights and remedies under this Agreement and each Transaction Document as a result of the Specified Defaults on and after the Forbearance Termination Date, provided that the Noteholders hereby agree to waive any right to apply a default rate of interest in addition to the Applicable Rate provided herein.

2.2 Maturity Date of the 2009 Notes. Notwithstanding any notices provided by the Noteholders to the Company in connection with Section 4A of the Note Agreement (which notices, for the avoidance of doubt, shall be considered rescinded on the Effective Date), the outstanding principal amount of all of the 2009 Notes shall be automatically due and payable in full on the Forbearance Termination Date, together with interest thereon, provided that if the Forbearance Termination Date occurs solely by virtue of a Forbearance Termination Event other than a Forbearance Termination Event arising from the failure of the Company to make any payment of principal, interest or fees in respect of the Notes when due, then the outstanding principal amount of all of the 2009 Notes shall be due and payable on the date that is three (3) Business Days following the Forbearance Termination Date, without any further action or notice by any Person, and provided further that the foregoing shall not affect the right of the Noteholders to exercise any of their rights and remedies in respect of such Forbearance Termination Event (including, without limitation, their right to accelerate any or all of the Notes).

2.3 Limited Effect of Forbearance. Notwithstanding the forbearance set forth in Section 2.1, in interpreting any covenants or other provisions in this Agreement and any Transaction Document that provide greater restrictions or limitations on, or impose additional requirements on, the Company and/or its Subsidiaries after the occurrence of an Event of Default, as opposed to when no Event of Default exists, the Specified Defaults shall be deemed to exist and continue in effect for the limited purpose of causing such greater restrictions and limitations and such additional requirements to be in effect throughout the Forbearance Period. Notwithstanding anything else herein to the contrary, during the Forbearance Period, the Company shall not be required to comply with the terms of the financial covenants set forth in Sections 5D, 5Q, 6H, 6Q and 6R of the Note Agreement.

SECTION 3. WARRANTIES AND REPRESENTATIONS.

To induce the Noteholders to enter into this Agreement, the Company hereby warrants and represents to the Noteholders, as of the Effective Date:

3.1 Organization, Existence and Authority .

(a) The Company is a banking corporation chartered pursuant to the National Consumer Cooperative Bank Act, as amended 12 U.S.C. §§3001-3051. The Company has the corporate power and authority to execute and deliver this Agreement and to perform its obligations hereunder.

(b) The Guarantor is a Delaware chartered savings and loan holding company duly organized, validly existing and in good standing under the laws of Delaware. The Guarantor has the corporate power and authority to execute and deliver this Agreement and to perform its obligations hereunder.

(c) Each Subsidiary of the Company is a corporation or other legal entity duly organized, validly existing and in good standing under the laws of its jurisdiction of organization. Schedule 3.1 hereto sets forth complete and correct lists of the Subsidiaries of the Company, showing, as to each Subsidiary, the correct name thereof, the jurisdiction of its organization, and the owners (and percentage of ownership) of each class of its capital stock outstanding.

3.2 Authorization, Execution and Enforceability . The execution and delivery by each of the Company and the Guarantor of this Agreement and the Bank Forbearance Agreement and the performance by each of the Company and the Guarantor of its respective obligations hereunder and thereunder have been duly authorized by all necessary action on the part of the Company and the Guarantor, respectively. Each of this Agreement and the Bank Forbearance Agreement has been duly executed and delivered by each of the Company and the Guarantor. Each of this Agreement and the Bank Forbearance Agreement constitutes a valid and binding obligation of each of the Company and the Guarantor, enforceable in accordance with its terms, except that the enforceability thereof may be:

(a) limited by bankruptcy, insolvency or other similar laws affecting the enforceability of creditors’ rights generally; and

(b) subject to the availability of equitable remedies.

3.3 No Conflicts or Defaults . Neither the execution and delivery by each of the Company and the Guarantor of this Agreement or the Bank Forbearance Agreement, nor the performance by each of the Company and the Guarantor of its respective obligations hereunder or thereunder, conflicts with, results in any breach in any of the provisions of, constitutes a default under, violates or results in the creation of any Lien upon any property of the Company, its Subsidiaries or the Guarantor under the provisions of:

(a) any charter document or bylaws of the Company, its Subsidiaries or the Guarantor;

(b) any material agreement, instrument or conveyance to which the Company, its Subsidiaries or the Guarantor may be bound or affected; or

(c) any statute, rule or regulation or any order, judgment or award of any court, tribunal or arbitrator by which the Company, its Subsidiaries or the Guarantor, or any of their respective properties, may be bound or affected.

3.4 Governmental Consent . Neither the execution and delivery of this Agreement or the Bank Forbearance Agreement, nor the performance by each of the Company and the Guarantor of its respective obligations hereunder or thereunder, is such as to require a consent, approval or authorization of, or filing, registration or qualification with, any Governmental Authority on the part of the Company or the Guarantor as a condition thereto under the circumstances and conditions contemplated by this Agreement or the Bank Forbearance Agreement.

3.5 No Defaults or Events of Default . After giving effect to the transactions contemplated by this Agreement and the Bank Forbearance Agreement, no Default or Event of Default (other than the Specified Defaults) will exist under the Note Agreement, this Agreement, the Credit Agreement (other than the Corresponding Defaults as to which Lender action has been suspended pursuant to the Bank Forbearance Agreement) or any other credit agreement to which the Company, its Subsidiaries or the Guarantor is a party. Immediately prior to giving effect to the transactions contemplated by this Agreement, (i) those Defaults or Events of Default identified as “Specified Defaults” or “Corresponding Defaults” constituted the only Defaults or Events of Default that existed or may have existed at such time and (ii) no defaults or events of defaults (other than the Corresponding Defaults) existed with respect to the Credit Agreement or any other credit agreement to which the Company, its Subsidiaries or the Guarantor is an obligor.

3.6 Disclosure . Except for (a) the Specified Defaults, (b) the Corresponding Defaults and (c) the transactions contemplated by this Agreement, there is no fact known to the Company or the Guarantor, as of the date hereof, that could reasonably be expected to have a Material Adverse Effect that has not been disclosed to the Noteholders.

3.7 True and Correct Copies . The Company has delivered to the Noteholders or Special Counsel true and correct copies of the Credit Agreement and the amendments thereto (including the Bank Forbearance Agreement) and each other credit agreement to which the Company, its Subsidiaries or the Guarantor is a party, as each is in effect on the Effective Date.

3.8 No Undisclosed Consideration . Except as expressly set forth herein or in the Bank Forbearance Agreement, none of the Company, its Subsidiaries, the Guarantor and any of their respective subsidiaries or affiliates has paid or will pay, directly or indirectly, any fee, charge, increased interest or other consideration to, or given any additional security or collateral to, or shortened the maturity or average life of any Debt or permanently reduced any borrowing capacity in favor of or for the benefit of, any creditor of the Company, its Subsidiaries, the Guarantor or any of their respective subsidiaries or affiliates as a condition to, or otherwise in connection with, the execution or delivery of this Agreement or the Bank Forbearance Agreement.

3.9 Letters of Credit. The Company warrants and represents that, other than as set forth on Schedule 3.9 hereto, none of the currently outstanding letters of credit issued by the Lenders are scheduled to, or are currently anticipated by the Company to, expire, terminate or otherwise be released or no longer be required to be outstanding by the beneficiary thereof, prior to 5:00 p.m. (New York time) on November 16, 2009.

3.10 Existing Debt and Liens. Schedule 3.10(a) hereto sets forth a complete and correct list of all outstanding Debt of the Company, its Subsidiaries and the Guarantor, in each case as obligors, as of July 31, 2009 (including with respect thereto, identification of the obligor(s) and the payee or creditor with respect to such Debt, whether such Debt is secured, guaranteed or subordinated to any other Debt of the Company, its Subsidiaries and the Guarantor and the dates and amounts of mandatory repayments of such Debt (whether by amortization payment or at maturity)), since which date there has been no material change in the amounts, interest rates, sinking funds, installment payment or maturities of the Debt of the Company, its Subsidiaries and the Guarantor, except as set forth on such Schedule 3.10(a). Schedule 3.10(b) hereto sets forth a complete and correct list of all Liens on property of the Company, its Subsidiaries and the Guarantor as of July 31, 2009 that secure Debt of any Person, and identifying in each c