The overarching intended effect of the changes is to give clarity while maintaining the rigor needed for such an agreement.

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1 Dear GFBC Members, March 9, 2014 The final draft of the Endowment Agreement plus the associated Endowment Committee governing document and Gifts Acceptance Policy have been prepared in concert with the planned vote for approval in the March business meeting. The committee considered with deliberation the merits of a number of alternative provisions in developing the original draft. The same process of multifaceted debate along with guidance from those knowledgeable in the field of institutional endowments was subsequently followed in considering adjustments to the agreement resulting from review phase feedback. The final draft reflects changes made to the agreement subsequent to church review and legal reviews performed by CBF- Foundation attorneys and a North Carolina (Raleigh) legal firm contracted by GFBC. The legal reviews substantiated soundness in approach and compliance in all regulatory aspects. Key Areas of Modification to The Agreement Draft The overarching intended effect of the changes is to give clarity while maintaining the rigor needed for such an agreement. 1. Article I: Changed name from a "Trust" to a "Fund" for simplification of the agreement and for ease of compliance management with regulatory governance. 2. Article III: Elaborated on the core Purposes of Benefit and added a category for other special purposes while still restricting to the intent of the endowment resolution. 3. Articles II, III, VIII, IX: Added congregational approval to committee membership election process. Made Agreement modifications require same approval as changes to By-Laws. 4. Article VIII: Referenced guiding language from the most recent NC legislation on management of Institutional Funds. 5. Article IX: Added statement affirming donor intended treatment of gifts designated as restricted per the donor's gift instrument. Additional comments regarding select provisions of the Agreement: Articles III and VII: The Purposes in Article III, as elaborated on in the final draft for clarity, are those most strongly emphasized by members through the endowment survey. These Purposes are intentionally written to broadly address the selected categories and limit the need for a large number of individually directed sub-funds (as explained in the original draft, Article VII). While perhaps counterintuitive, our observation is that churches setting out with limited and narrow purposes inevitably evolve to an ever increasing set of small directed funds requested by contributors. Articles VIII and IX: The Agreement is structured to manage the Fund such that it neither suffers the erosion of inflation nor can be invaded as an offset to church operating budget deficiencies. The examination of a number of endowment agreements established in the last years by churches from multiple Christian denominations revealed adoption of an approach utilizing tightly managed flexibility for temporary access to principal in the event of dire emergencies. Advisors at the CBF-Foundation have affirmed the desirability of this approach, as incorporated in the GFBC Agreement. Thank you. Please contact a member of the Endowment committee with questions.

2 GREENWOOD FOREST BAPTIST CHURCH ENDOWMENT FUND AGREEMENT (Draft, March 9, 2014) As has been approved by the congregation in Church Conference, Greenwood Forest Baptist Church hereby establishes a permanent endowment fund in accordance with the following provisions. THIS ENDOWMENT FUND AGREEMENT is made this 16 th day of March, 2014, by GREENWOOD FOREST BAPTIST CHURCH, CARY, NORTH CAROLINA, a tax-exempt, nonprofit religious entity organized under the laws of the State of North Carolina located in Cary, North Carolina ( the Church or Church or GFBC ). Article I. FUND NAME AND PURPOSE The Fund hereby created shall be known as the GREENWOOD FOREST BAPTIST CHURCH ENDOWMENT FUND (the Endowment Fund, or the Fund ). The Endowment Fund is established for the benefit of the Church consistent with furthering its mission in accordance with the general and specific purposes defined in Article III herein, and in abidance with Endowment restrictions thereon. Article II. GOVERNANCE AND AUTHORITY The Endowment shall be governed by and in accordance with the terms of this Endowment Fund Agreement ( Agreement ), and shall be administered in accordance with all applicable federal, state, and local laws, including, but not limited to, the North Carolina Uniform Prudent Management of Institutional Funds Act (N.C.G.S. 36E-1 et. seq.) (the Funds Act ). The Endowment shall be managed and overseen by the Church Endowment Fund Committee (herein referred to as the Endowment Committee or Committee ). The Endowment Committee shall be established with five (5) members and initially comprised of one member with a one year term, one member with a two year term, etc., including a fifth member with a five year term. Thereafter each year one member will rotate off the active Endowment Committee. Following consultation with the remaining Endowment Committee members and the Deacon chair for the purpose of identifying the skills or knowledge currently needed by the Endowment Committee, a successor will be presented by the Nominating Committee for election by the church by the same procedures followed for election of Deacons. Upon expiration of a Member s term, the Member is ineligible to serve as Member again for a period of one year. The Committee may have as ex-officio members, but not restricted to, the Church Treasurer, Church Trustees, Chair of the Diaconate, Chair of Finance Committee, and Church Pastor. Assignment of positions within the Committee is left to the workings of the Committee itself. Members shall not be restricted from holding any other board or committee positions within the Church. The Endowment Committee has responsibility to recommend policy modifications as deemed appropriate over time, has the authority to make investment decisions as detailed in this document, and to promote memorial and legacy gifts through planned giving and estate

3 planning. Any of the above Endowment Committee responsibilities may be delegated, contracted, assigned or conducted in partnership with professional advisors and/or others as approved by the Church. A companion document to this Fund Agreement entitled GFBC Endowment Fund Committee Powers, Authority, Protection, adopted in concert with this Endowment Fund Agreement, provides details of the authorities, limitations, and protections granted the Endowment Committee and its members. Article III. PURPOSES OF INCOME BENEFIT The Endowment Fund is intended to afford the Church the opportunity to advance causes beyond that which would be achievable through regular stewardship contributions. The assets of the Endowment Fund shall be utilized by the Church: In the furtherance of its missions opportunities and endeavors o Funds could be applied, but not limited to, assisting in the funding of extraordinary missions efforts such as the establishment of new churches or the construction of their necessary facilities, grants to support theological education, grants to support missionaries and their work. For example New Missions Fund. In the development of new ministry and education initiatives o o Funds could support the establishment of new or experimental church programs. For example New Venture Programs Fund. Funds could support religious educational activities including, but not limited to, grants in support of new or innovative religious education programs; study loans or grants; and grants to institutions for religious education. For example Religious Education Fund. In the upkeep or renovation of GFBC facilities under special circumstances. o Funds could assist in providing for the functional needs of the church relative to, but not limited to, land, buildings and facilities, parking facilities, and renovations. For example - Campus Facilities Fund. Special Gifts and Other Funds o To provide for the receipt of special gifts and other funds to be managed and disbursed in accord with the expressed intent of the donor(s) not inconsistent with the purposes, goals and provisions of this resolution and upon approval by the Endowment Fund Committee

4 The Endowment Fund will be held as a General Endowment Fund Account with purpose of application unrestricted within the categories identified above. Distributions are expressly not allowed for capital improvements or for coverage of regular church operations as would normally be addressed by the annual church operating budget. As an endowment fund, distributions are not allowed from the Fund corpus without exception approval as defined in Article IX, Distributions and Exclusive Purpose. Because of the long-term nature of the Endowment Fund, the Church may elect to modify the list of Purposes in the future. Revisions to the Purposes would require approval vote by seventy-five percent (75%) of the Board of Deacons and by two-thirds vote of the members present and voting at any regular or called church conference provided that proposed alterations have been given to the clerk in writing and copies have been presented to the church membership at least 30 days prior to voting. This replicates the requirements for amendments to the church By-laws per Article XVIII such By-laws. Article IV. GIFT ACCEPTANCE AND MANAGEMENT All proposed gifts, grants, devises, bequests, or transfers must be made specifically to the Endowment Fund and must be accepted by the Endowment Committee as a condition precedent to the transfer of property becoming a part of the Fund or any constituent fund. No gift devise or conveyance of any property shall be received and accepted if it is conditional or limited in such a manner as to require the disposition of the income or the principal to any person or organization other than a charitable organization or other than charitable purposes within the meaning of such terms as defined herein, or as shall, in the opinion of the Endowment Committee members, jeopardize the federal income tax exceptions of this Endowment Fund pursuant to Section 501(c)(3) of the Internal Revenue Code or the corresponding section of any future federal tax code. The Endowment Committee may refuse to accept any property if it determines that such refusal is in the best interests of the Fund or the Church. A companion document to this Fund Agreement entitled GFBC Endowment Fund Gift Acceptance Policy, adopted in concert with this Endowment Fund Agreement, provides the rules and procedures adopted by the Church for the receipt and management of gifts to the Endowment Fund. Article V. INVESTMENT Investment decisions shall be made in accordance with the Funds Act and authorized by the Endowment Committee. The Endowment Committee shall incur no liability in any case except for willful misconduct or gross negligence. The Endowment Fund year will coincide with the Church fiscal year. The Endowment Committee is authorized to place the Endowment Fund cash and capitalized assets with a professional funds manager (the Fund Manager ) with experience in the investment and management of such endowment and other long-term funds. In their sole discretion, the Endowment Committee may change the depository entity and/or Fund Manager as may be appropriate. Fund management expense shall be paid from the income of the Endowment Fund. In the event income is insufficient to cover management

5 expenses the Endowment Committee may temporarily authorize the expenditure of Endowment Fund principal for this purpose. The assets of the Endowment Fund shall be invested by the Fund Manager in consultation with the Endowment Committee in a manner that utilizes a managed policy intended to stabilize the annual amount available for distribution while growing the value of the fund assets over a long term horizon. The Endowment Committee specifically agrees that in all cases it will use prudence and its best judgment in establishing investment policies but does not guarantee maintenance of corpus or income. In making investment decisions the portfolio will be managed on the basis of the entire investment account without regard to the objective of sub accounts within the Endowment Fund. The account will be managed on a diversified basis and will be rebalanced on at least an annual basis as deemed appropriate by the Endowment Committee upon advice and consultation from the Fund Manager. The Endowment Committee must consider that preservation of capital is the first priority of investment conduct while income and capital gain are secondary. However, the Endowment Committee must consider that prudent investment management requires some tolerable amount of risk considering the economic environment, inflation, regulatory environment, and market volatility. Article VI. SOCIALLY RESPONSIBLE INVESTMENTS The Fund shall be invested only in socially responsible funds as may prudently be determined by the Endowment Committee and/or Fund Manager. There shall be no holdings whose business is involved in industries that the Endowment Committee determines in its sole discretion to be not socially responsible investment including, but not limited to, the pornography, alcohol, or tobacco industries. Article VII. ADDITIONS TO THE ENDOWMENT AND SUB-ACCOUNTS The establishments of sub-accounts or sub-funds within the Endowment Fund are subject to prior approval of the Endowment Fund Committee. The Church has defined the broad categories for use of Endowment Fund income in Article III, Purposes of Income Benefit. GFBC Endowment Fund contributors are encouraged to direct their gifts to the General Endowment Fund Account with benefit to one or more of the identified categories for benefit. It is intended that each of the stated areas of priority significantly benefit from the Endowment and as such the Endowment Committee will exercise prudence with regard to approving the establishment of smaller sub-accounts. The effects of servicing smaller directed funds on the ability of the Church to drive significant new activities, and the constructive management of multiple smaller funds in volatile financial periods, must be considered. General criteria for the establishment of a named and restricted sub-fund are as follows: Fund minimum principal of $25,000. Minimum initial contribution of $12,

6 Five (5) year time limit from initial contribution to attain fund minimum of $25,000. Funds not achieving the minimum principal value within the five (5) year period will have assets transferred to the Endowment General Fund Account. Public recognition of Endowment Fund contributors will be subject to donor wishes for anonymity. Forms of recognition are subject to approval by the Endowment Committee and Board of Deacons. Article VIII. PRESERVATION OF HISTORIC DOLLAR VALUE In alignment with the most recent regulatory legislation concerning the management of institutional funds, prudence and sound judgment on the part of the managing entity (GFBC Endowment Fund Committee) will be the cornerstones to the administration of Endowment Fund assets. For purposes of this Endowment Agreement, and with allowance for prudent judgment, Historic Dollar Value will be a key established reference point for decisions regarding allocations and growth of the Endowment Fund. Historic Dollar Value shall mean the aggregate initial value of all gifts at the time of contribution thereof plus allocations of income to principal. All distributions from the Fund unless otherwise approved per provisions in Article IX, Distribution and Exclusive Purpose, may be made only from the excess of the net appreciation, whether realized or unrealized, in the fair market value of the Fund over the Historic Dollar Value of the Fund. Further, accumulated income is defined as the net appreciation less the sum of Endowment Fund expenses (management fees and incidental), distributions, and any income capitalization allocations for inflation protection and fund growth. Each year the Fund will recognize the net investment income (dividends, interest, royalties, rent) less investment expense, plus capital gains, plus net asset appreciation less net asset depreciation. In the event of a net loss, if the net loss is in excess of the accumulated income amount any excess loss will be allocated to the fund principal. If at any time the fund principal is less than the historic dollar value (total of accumulated assets and prior allocations to principal), income (less expenses) will first be allocated to restore the Fund to the historic dollar value. Any excess will then be applied to accumulated income. At the determination of the Endowment Committee, some or all of the undistributed accumulated income may be allocated to the Fund principal in the event that a distribution is not needed or requested in its whole in any given calendar year. While not a requirement of the agreement, such allocations of income would serve to assist with maintaining pace of the Endowment Fund value with inflation and potentially allow for additional growth of the corpus exclusive of new donor contributions. Notification of such allocation shall be provided by written notice to the Fund Manager from a representative of the Endowment Committee. Article IX. DISTRIBUTIONS AND EXCLUSIVE PURPOSE Distributions of income from the Endowment Fund or any constituent funds shall be administered in accordance with the Funds Act. No part of the corpus or net income of this fund shall ever be diverted from exclusively charitable, religious, or educational purposes

7 No distribution shall be made from the Endowment Fund until the asset value of the Fund, including accumulated appreciation, shall total $500,000. Each year the Endowment Committee shall determine if it is prudent to make expenditures from the Endowment Fund (also reference Article VIII, Preservation of Historic Dollar Value ). In making this decision the Endowment Committee will consider the fund duration, purposes, general economic conditions, effects of inflation/deflation, expected total return, other resources for projects funding, and the fund investment policy. Expenditures shall be charged to the accumulated income fund. If the expenditure is in excess of the accumulated income fund, any excess expenditure will be charged to the fund principal. This would constitute an exception to the policy of only spending from Endowment Fund income and would require recommendation by the Endowment Committee to the Deacon Board for exception approval. Distributions from the Endowment Fund or any constituent fund shall be made in accordance with the following procedure and pursuit to applicable procedures set forth in the Church By- Laws: Requests for disbursements shall be made from the heads of Church Ministries (or alternate titled church organizational heads) to the Endowment Committee Proposals for disbursements shall be made by the Endowment Committee, reviewed by the Finance Committee, and approved by the Diaconate Normal operating procedure, though not to be restrictive of off-cycle distribution needs, would then couple Endowment Fund distributions approvals with the annual Church budget development and approval process and cycle. Except as provided hereinafter, only the net income of the Endowment Fund shall be available to the church to aid in accomplishing its objectives; provided, however, that application of principal may be made for a specific purpose only upon the declaration of an emergency or other future conceived rationale necessitating such use of principal set forth in a resolution of the Diaconate, duly adopted by a vote of 75% of all members of the Deacon Board, and approved by two-thirds vote of the church members present and voting at a regular or called church conference. Notwithstanding the foregoing, the principal and/or income attributable to any restricted fund or gift shall be used for purposes consistent with said restrictions. Any expenditure of principal is to be approved only as accompanied by a documented plan for return of the encroached value to the Endowment Fund corpus. Distributions of income from the Endowment Fund shall be made as directed by the Endowment Committee provided that no more than five per cent (5%) of the rolling 3 year (12 quarter) average market value of the Endowment Fund may be distributed in any calendar year except in extraordinary circumstances such as catastrophic events including but not limited to fire, flood, or hurricane, the need for a replacement facility or facility component, or some similar urgent event. Provisions for an Endowment funded program in jeopardy of failure due to funding loss may also be considered within this class of exceptions. Any extraordinary distribution must be

8 approved by the Endowment Fund Committee, the Finance Committee, and seventy-five percent (75%) of the members of the Diaconate. If the full five percent (5%) distribution limit is not authorized for distribution in a calendar year, it may be accumulated, tracked as undistributed income and distributed upon request in later years in addition to the annual 5% distribution, or it may be allocated / capitalized to Fund principal as referenced above. In no event may distributions reduce the value of the Fund below the Historic Dollar Value except in extraordinary circumstances approved as set forth above. If annual earnings exceed five percent (5%) of the rolling 3 year (12 quarter) average market value of the Fund, the above policy may be waived by action of the Endowment Fund Committee to allow for up to seven percent (7%) of the rolling 3 year (12 quarter) average market value of the Fund to be distributed. Article X. MEETINGS AND REPORTING The Endowment Fund Committee shall meet at least quarterly and shall adopt procedures for the management of the Endowment Fund as may be necessary and appropriate. The Committee is responsible for maintaining all Endowment Fund documentation, governing rules and regulations, procedures, transactions, and reports. The Committee shall keep true and accurate accounts of all investments, receipts and disbursements and other transactions hereunder, and all accounts, books and records relating thereto shall be open to inspection and audit at all reasonable times by any person or persons designated by the Diaconate The Endowment Fund Committee shall review the investment performance at the end of each quarter (end of November, February, May, August) no later than the month end following the end of each quarter and present a report to the Board of Deacons as soon as feasible following the review. The report shall include but is not limited to the investment income and expenditures for the previous quarter, the historic dollar value of the Endowment Fund, and the current market value of the Fund including gifts received and/or assets capitalized since the last reporting period. The Church shall receive an accounting of its transactions with respect to the Endowment Fund on a periodic basis, but in no event less often than annually. Article XI. TERMINATION; CONTINGENCY OF OWNERSHIP AND/OR BENEFIT This Endowment Fund shall continue indefinitely unless and until terminated by an affirmative vote by three-fifths of the Endowment Fund Committee members, by seventy-five percent (75%) of the membership of the Diaconate, and by two-thirds of the membership of the Church. Upon the dissolution of the Endowment Fund, the assets of the Endowment Fund shall become the property of the Church for one or more of the exempt purposes within the meaning of Section 501 (c)(3) of the Internal Revenue Code of 1986, as amended, or the corresponding section of any future federal tax code. or a successor corporation having the same general purpose as outlined below in the event the Church were to elect to transfer the assets of the Fund upon Endowment Fund dissolution

9 If at any time the Church is not in existence or is not an exempt organization described under both state and federal tax laws, gifts to which would be deductible for federal income, gift and estate tax purposes, at the time when any amount is to be irrevocably transferred to it, then the balance of the Fund shall be applied for the benefit of such other ministry, institution or agency as the Church directs at the time it disbands, meeting such conditions and used in the same manner and for the same charitable purposes above described, but no portion shall be paid to a private Foundation as defined in Section 509 (a) of the Code, or corresponding provisions of any subsequent federal tax laws, or to an organization or entity other than one so described in each of the Code sections and referenced state and federal laws above. In the instance of failure of the Church to so direct a contingent beneficiary or beneficiaries, the Board of Trustees of The Cooperative Baptist Fellowship Foundation shall determine the beneficiary by its policy to provide benefit as closely as possible to the original intent of the Endowment Fund. Article XII. MODIFICATION AND AMENDMENT This Endowment Fund Agreement may be modified from time to time provided that no amendment shall authorize the Endowment Fund Committee members to conduct the affairs of this Endowment Fund in any manner contrary to the provisions of section 501(c)(3) of the Internal Revenue Code or the corresponding sections of any future tax code. Any amendment to this Endowment Fund Agreement shall be affected by written instrument, in resolution form, upon approval by the Endowment Fund Committee, seventy-five percent (75%) approval vote of all members of the Board of Deacons, and by two-thirds vote of the members present and voting at any regular or called church conference provided that proposed alterations have been given to the clerk in writing and copies have been presented to the church membership at least 30 days prior to voting. Article XIII. COMMUNICATIONS BETWEEN MANAGING ENTITIES Electronic communications (example ) from or copied to at least two Endowment Committee members to or from the Fund Manager shall constitute written notification on matters of investment allocations, decisions, document exchanges, and reporting. Hard copies of all such electronic communications are to be retained by the Endowment Committee as record of the communications. Article XIV. GUIDANCE OF FUND ADMINISTRATION A copy of this Endowment Fund Agreement shall be provided to the authorized entity professionally managing and administering the Fund. Article XV. MISCELLANEOUS, ADDITIONAL DEFINITION OF TERMS A. The terms "charitable organization" or "charitable organizations" shall mean corporations, religious associations, trusts, funds, foundations or community chests created or organized in the United States or in any of its possessions, whether under the laws of the United States, any state or territory, the District of Columbia, or any possession of the United States,

10 organized and operated exclusively for charitable purposes and being entitled to exemption from federal income tax under Section 501 (c) (3) of the Internal Revenue Code of 1986, as amended, or the corresponding section of any future tax code. B. The term "charitable purpose" shall be limited to and shall include only religious, charitable, scientific, literary, or educational purposes within the meaning of those terms as used in Section 501 (c) (3) of the Internal Revenue Code of 1986, as amended, or the corresponding section of any future tax code, but only such purposes as also constitute charitable purposes under the law of trusts of the State of North Carolina. C. This Endowment Fund Agreement shall be construed and interpreted in accordance with laws of the State of North Carolina. Article XVI. INDEMNIFICATION Every person who is or shall have been a Member of this Endowment Fund Committee shall be indemnified by the Church against all costs and expenses reasonably incurred by or imposed upon him or her in connection with or resulting from any action, suit or proceeding to which he or she may be made a party by reason of his/her being or having been a Member of this Endowment Fund Committee, except in relation to such matters as to which he or she shall finally be adjudicated in such action, suit or proceeding to have acted in bad faith or to have been liable by reason of willful misconduct in the performance of his/her duty as an Endowment Fund Committee member. Costs and expenses shall include, without limitation, attorneys fees, damages and reasonable amounts paid in settlement. Article XVII. CHURCH AUTHORITY TO ESTABLISH THE ENDOWMENT The Establishment of THE GREENWOOD FOREST BAPTIST CHURCH ENDOWMENT FUND has been authorized by vote of the membership of the Church and this Endowment Agreement has been approved by the Diaconate of the Church

11 Article XVIII. CHURCH AUTHORITY TO SIGN The Greenwood Forest Baptist Church Board of Directors whose signatures appear below was authorized by the Church to establish the Greenwood Forest Baptist Church Endowment. The following signatures of the members of the Board of Directors attest to the Greenwood Forest Baptist Church approval and also to the approval of the GFBC Diaconate to establish the Endowment Fund and the Endowment Fund Committee. The following signatures of Church Board of Directors attest to the Church approval of the terms, conditions and actions as recorded in this document. BOARD OF DIRECTORS, GREENWOOD FOREST BAPTIST CHURCH PRINT NAME SIGNATURE President, GFBC Board of Directors PRINT NAME SIGNATURE Secretary, GFBC Board of Directors PRINT NAME SIGNATURE Assistant Secretary, GFBC Board of Directors WITNESS OF SIGNATURES AFFIXED ABOVE PRINT NAME SIGNATURE SIGNED ON (MONTH) (DAY) (YEAR)