Exhibit 10.1
 
PRIMESOURCE MORTGAGE, INC.
PRODUCING SALES MANAGEMENT AND SUPERVISION AGREEMENT

This Agreement hereinafter referred to as “Agreement” made and entered into on
this 1st
day of January, 2013 (the “Effective Date”) by and among PRIMESOURCE MORTGAGE,
INC., a Delaware Corporation, with its Main Office located at 1112 North Main
Street, Roswell, NM 88201 (the “Corporate Office”), hereinafter referred to as
“PSMI,” and James D. Pulsipher, hereinafter referred to as “Manager,” with
his/her principal office located at 700 Belford Avenue, Grand Junction, CO,
81501, hereinafter referred to as the “Branch Office.”

WHEREAS, PSMI desires to expand its lending territory throughout the States in
which it is duly licensed and/or in process of securing licensing in the United
States of America; and

WHEREAS, Manager has knowledge, skills and experience in originating,
processing, closing, funding and selling mortgage loans, and is available for
employment by PSMI to open and manage a mortgage loan origination branch office
pursuant to the terms, conditions, provisions and limitations of
this Agreement and in accordance with all Applicable Requirements (as defined
below);

NOW, THEREFORE, in consideration of mutual covenants and promises contained
herein and other good and valuable consideration, the receipt and sufficiency
being mutually acknowledged, the parties hereto covenant and agree as follows:

1.             Employment.    PSMI hereby employs Manager and Manager hereby
accepts employment upon the terms and conditions outlined in this Agreement.

2.             Representations and Warranties.   Both PSMI and Manager warrant,
promise and covenant that each has the complete authority, right and ability to
enter into this Agreement.  Manager understands and agrees that this Agreement
does not imply any ownership interest in PSMI.  Without limiting any obligations
of Manager, Manager hereby represents and warrants to PSMI at all times during
employment as follows:

a.           Manager’s employment with PSMI will not violate or conflict with
any obligations Manager owes to any individual or entity, including without
limitation, obligations arising out of or relating to (i) any non-compete,
non-disclosure, non-solicitation or confidentiality agreements or provisions,
and (ii) any prior employer or employment.

b.           Manager knows of no reason why Manager could not or should not
accept an offer of employment from PSMI, or otherwise be employed by
PSMI.  Manager has not been subject to any investigation or sanction of any
type, or denied any license or approval, by any federal, state or local
government, quasi-government and private industry authority, including but not
limited to any licensing authority.

c.           Manager currently possesses, and at all relevant times has
maintained in good standing, any and all licenses required to conduct business
as a loan officer for each state in which such business will be conducted.
 
 
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3.             Employment at Will.

a.           PSMI and Manager agree that this employment shall be “at will” and
is subject to termination by either PSMI or Manager upon sixty (60) days written
notice in accordance with Section 11; provided, however, that PSMI may, at its
sole discretion, limit or restrict Manager’s access to Confidential Materials
(as defined below) or PSMI property, locations (including the Branch Office),
systems or equipment immediately upon such written notice.  If Manager resigns
and will become employed by any company involved in mortgage lending or
brokering, loan processing or underwriting services, loan modification services,
real estate sales or acquisition, closing, settlement or title-related services,
credit repair, credit counseling, borrower assistance or other business or
service of the same or similar nature, PSMI may, at its sole discretion, waive
or shorten the notice period required under this Section 3(a).

b.           Notwithstanding Section 3(a) above, if PSMI determines, in its sole
discretion, that Manager has violated any Applicable Requirement, has committed
any act as defined below as Termination for Cause, or has violated any terms of
this Agreement, PSMI may terminate this Agreement immediately upon notice to
Manager.  If Manager, in his sole discretion, determines that PSMI has violated
any applicable federal, state or local law or any terms of this Agreement,
Manager may terminate this Agreement immediately upon written notice to PSMI.

c.           Termination for Cause includes, but is not limited to, the
following:

i.
 
Possession or use of illegal drugs on or at any PSMI location;

ii.
 
Use of alcohol and/or intoxication on or at any PSMI location;

iii.
 
Dishonesty or theft;

iv.
 
Participation in physical violence on or at any PSMI location;

v.
 
Conviction of a serious criminal offense;

vi.
 
Harassment or abuse of any PSMI employee or supervisor;

vii.
 
Insubordination;

viii.
 
Unauthorized carrying or discharge of any firearms on or at any PSMI location;

ix.
 
Willful destruction of any PSMI property;

x.
 
Violation of this Agreement or any Company Policy (as defined below); or

xi.
 
Manager’s failure to meet satisfactory production standards, as set forth in
Exhibit A to this Agreement, within a reasonable time after formal written
warning to improve production.

4.
Managerial Duties and Responsibilities.

a.           Under the supervision and direction of PSMI, and operating under
PSMI’s approval, Manager’s primary duty shall be overseeing the sales operations
of Branch offices as assigned by PSMI, and Manager shall at all times devote
substantially more than fifty percent (50%) of his or her working hours to
managerial functions.  In this regard, Manager’s managerial functions shall
include without limitation:

i.
 
Supervision over at least two (2) full time employees;

 
 
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ii.
 
Preparation and forwarding of all reports, memoranda and documents to the
Corporate Office as directed from time to time;

iii.
 
Developing and maintaining an attitude of teamwork, establishing a culture
consistent with PSMI’s corporate mission statements, and ensuring employees
abide by the Company Policies;

iv.
 
Recruiting staff for the Branch Office, reviewing payroll information and
communicating with PSMI’s Human Resources Department on personnel changes,
including recommendations for new hires and terminations;

v.
 
Reviewing monthly commission calculation worksheets, remaining cognizant of
their contents, modifying branch efforts to keep results in line with
expectations, and preparing and submitting periodic production projections in
accordance with Company Policies and PSMI’s expectations;

vi.
 
Developing and maintaining a network of relationships with existing and
prospective clients, promoting the image and reputation of PSMI as creative,
dynamic and competitive, expanding PSMI’s market share through the promotion of
PSMI’s business and sales, and actively holding, and ensuring attendance by
branch members, sales meetings, training seminars, and other events; and

vii.
 
Assisting PSMI’s management in the development and management of all employees
of PSMI who are assigned to work at the Branch Office (the “Branch Employees”),
including the origination, processing and closing of mortgage loans originated
through the Branch Office; and

viii.
 
Performing such other duties set forth in this Agreement or otherwise assigned
by PSMI from time to time.

b.           Manager further agrees to comply with all manuals, guides,
memoranda, e-mails and other materials that set forth PSMI’s policies and
procedures (“Company Policies”), existing now or in the future, so long as they
do not violate any federal, state or local laws.  Manager is familiar with and
shall comply, and cause the Branch Employees to comply, with the Company
Policies and all applicable federal, state and local laws, ordinances, rules,
regulations, guidelines and other requirements pertaining to the mortgage
banking industry, to the business of PSMI, and to the origination, processing,
underwriting, closing, or funding of mortgages, or other activities of the PSMI,
including but not limited to the Equal Credit Opportunity Act,
Gramm-Leach-Bliley Act, Truth in Lending Act, Real Estate Settlement Procedures
Act, USA PATRIOT Act, Home Mortgage Disclosure Act, Federal Trade Commission
Act, Telemarketing and Consumer Fraud and Abuse Prevention Act, Fair Credit
Reporting Act, Fair Housing Act, Secure and Fair Enforcement for Mortgage
Licensing Act of 2008 (the “SAFE Act”), Dodd-Frank Wall Street Reform and
Consumer Protection Act and all related regulations to the foregoing Acts, and
all similar federal, state and local laws, rules, regulations and requirements,
federal and state telemarketing and do-not-call laws, rules and regulations, and
all applicable guidelines and requirements of the United States Department of
Housing and Urban Development (“HUD”), Department of Veterans Affairs (“VA”),
Federal Home Loan Mortgage Corporation (“FHLMC” or “Freddie Mac”), Federal
National Mortgage Association (“FNMA” or “Fannie Mae”), Government National
Mortgage Association (“GNMA” or “Ginnie Mae”), United States Department of
Agriculture (“USDA”), Consumer Financial Protection Bureau (“CFPB”) and all
other applicable agencies, investors and insurers (altogether, the Company
Policies and all such applicable laws, rules, regulations, guidelines and other
requirements are referred to herein as the “Applicable Requirements”), in each
case as amended from time to time.  Manager agrees to develop and maintain
his/her knowledge and understanding of all such Applicable Requirements.
 
 
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c.           Manager shall make recommendations to PSMI regarding the location
to be leased by PSMI as the Branch Office, and the furniture, fixtures and
equipment to be purchased.  Notwithstanding the foregoing, all final decisions
in this regard shall be made by PSMI.  Manager shall also recommend staff to be
employed by PSMI to operate from the Branch Office and the compensation to be
paid, and PSMI may hire such employees in its sole discretion.  While PSMI will
consider Manager recommendations regarding hiring, discipline and termination,
all decisions to hire, terminate and discipline employees shall be made by PSMI
and are within PSMI’s discretion.  Manager shall, and shall cause all Branch
Employees to, participate in training sessions as required by PSMI from time to
time.
 
d.    Manager will maintain and supervise PSMI systems for the processing of
mortgage loans in accordance with the policies and procedures of PSMI and any
lender who may be purchasing such mortgage loans.  Manager may only lock in
interest rates for applicants with the approval of designated officers of PSMI
and pursuant to the policies and procedures established by PSMI.  Any and all
complaints, whether written or verbal, made to Manager or any employee at the
Branch Office by any customer or third party shall be immediately reported, in
writing, to PSMI even if such complaint appears groundless to Manager.

 
e.
Manager will forward or cause to be forwarded all fees derived from the closing
of

mortgage loans to the Corporate Office as directed by PSMI. Such fees shall be
maintained in an account to be established by PSMI. PSMI agrees to provide
accounting to Manager with respect to all aspects of business concerning the
Branch and the account established by PSMI for the Branch Office. Manager also
agrees to provide accounting to PSMI with respect to all aspects of the business
conducted at the Branch Office.

5.                 Loan Originator Duties and Responsibilities.

a.           In addition to the managerial duties and responsibilities set forth
above in Section 4, Manager, as a licensed loan originator, agrees to solicit
mortgage loans solely on behalf of PSMI in those states where Manager is
licensed as a loan originator and PSMI is permitted to act as a mortgage
lender.  For the purposes of this Agreement, “mortgage loan” means a loan
secured by residential real property that will be made by PSMI in connection
with sales and refinancings of one- to four-family dwellings, condominium
apartments and cooperative apartments.  Manager also agrees to solicit such
other types of loans as may be authorized from time to time by PSMI in
writing.  All of the loans submitted by the Manager are subject to the review
and approval of PSMI.

b.           The mortgage loans solicited by Manager shall meet the PSMI’s
criteria, including the terms, conditions, policies, procedures and directives
established by PSMI.  All loans solicited shall also be in conformance with
PSMI’s prevailing rates and fees.  PSMI reserves the right, in its sole
discretion, and without prior notice to the Manager, to change or discontinue
any of its pricing, terms, conditions, policies, procedures, directives, rates,
terms, and fees, and to discontinue offering any one or more types of products
or services.
 
 
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c.           Manager shall be responsible for completing all forms, booklets,
estimates, disclosures and documents that are required to be provided to
applicants by any state or federal law or regulation, by investor guidelines or
by PSMI (collectively, the “Documents”), and for providing these Documents to
applicants at application or as otherwise required.  In addition to the
solicitation of mortgage loans, Manager shall perform all other duties assigned
by PSMI, including, without limitation, the following:

i.
 
take information from each applicant or prospective applicant and complete an
applicant’s worksheet;

ii.
 
collect necessary financial information;

iii.
 
maintain regular contact with an applicant and PSMI between the time of and
application and closing;

iv.
 
transmit a completed application to PSMI;

v.
 
maintain and submit adequate records, as required by PSMI, of all loan
solicitations made by Manager;

vi.
 
service all accounts, including regularly contacting the applicant and any party
referring mortgage loans to PSMI or Manager; and

vii.
 
perform such other duties related to the origination of mortgage loans as PSMI
may assign.

6.             General Duties and Responsibilities.

a.           Manager will devote his/her full time and energy to the business of
PSMI and will not represent, originate loans for, or solicit loans for any other
company; in addition, Manager shall not receive compensation for any individual,
corporation, partnership, or entity other than PSMI for the performance of any
job duties or activities in accordance with this Agreement.  Manager shall not
engage in any in any mortgage lending or brokering, loan processing or
underwriting services, loan modification services, real estate sales or
acquisition, closing, settlement or title-related services, credit repair,
credit counseling, borrower assistance or other business or service of the same
or similar nature, any other activities in connection with the mortgage finance
industry, or any other activities as set forth in this Agreement, for any
individual, corporation, partnership, or entity other than PSMI.  Additionally,
Manager may not own an interest in any entity engaging in any such activities,
other than a passive investment of less than one percent (1%), without the prior
written consent of PSMI.

            b.           During the term of his or her employment pursuant to
this Agreement, Manager shall serve PSMI faithfully and to the best of his or
her ability and shall devote his or her time, energy and diligence to the
performance of the duties assigned by PSMI.  Manager shall adhere to and comply
with all Company Policies established by PSMI.  Manager shall use the trade name
and trademark of PSMI in conformity with the standards developed by PSMI from
time to time in PSMI’s sole discretion.
 
c.           Manager shall protect all PSMI property being used in the
performance of his or her employment and shall immediately return all such
property upon request by PSMI.
 
 
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d.           PSMI’s exercise of its right to terminate under this Agreement
shall be without prejudice to any other remedy which PSMI may be entitled to at
law, in equity or under any other provision of this Agreement or any addendum
hereto.

e.           Upon cessation of employment, Manager will return to PSMI all
manuals, pricing lists or rate sheets, customer information and lists, all
mortgage loan applications and other documents relating to mortgage loan
transactions which had not yet been closed prior to cessation of employment and
all other PSMI property and Confidential Material in accordance with Section
6.  Upon violation of this Section 6 or upon any breach of this Agreement,
Manager, in addition to any other remedies which may be available by law, shall
forfeit all commissions which are due or which may become due.
 
f.            Manager is prohibited from entering into or executing any
contracts, agreements, commitments or other similar obligations in the name of
PSMI.  Only authorized corporate officers are permitted to bind PSMI to any
contract, agreement, commitment or other similar obligation.

g.           Manager is prohibited from incurring any expenses or obligations on
behalf of PSMI unless permitted in the Company Policies or unless PSMI provides
its prior written approval.  Manager shall promptly submit invoices and other
supporting documentation for reimbursement of permitted expenses in accordance
with the Company Policies.

7.             Representations Regarding Past Agreements

Manager hereby represents and warrants to PSMI that the execution, delivery and
performance of this Agreement by the Manager does not and will not conflict
with, or result in breach or default under, or require the consent of, any other
party under any agreement to which the Employee is a party.

8.             Territory

Manager shall manage the offices assigned by PSMI located in the States of
Colorado, Utah, Wyoming, Montana, North Dakota, South Dakota, and Idaho (the
“Territory”); provided, however, that any PSMI branch offices existing in the
Territory as of the Effective Date of this Agreement shall be excluded from the
terms of this Agreement and no compensation shall be paid to the Manager for
such branches.  The Manager shall use his best efforts to add additional branch
offices in the Territory as soon as possible.  Notwithstanding the foregoing,
based upon an annual review of regional operations of the Employer conducted
within 30 days of each fiscal year end, the Employer reserves the right to
oversee and adjust the Territory, including, but not limited to, realigning the
area covered by the Territory, if it determines to do so would be in the best
interests of the Parent overall.  The Employer shall not open or acquire branch
offices in the Territory, unless Manager is designated as the manager of such
offices.  All compensation payable to Manager for acting as regional manager
shall be included in and paid solely in accordance with Section 5 of this
Agreement and the Manager shall receive no additional compensation for serving
as regional manager. The termination of this Agreement by the Employer shall
terminate the Manager as regional manager.  The Manager shall have such duties
and responsibilities as regional manager as the Employer and the Manager shall
reasonably determine from time to time.
 
 
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9.      Title

In addition to the position of Sales Manager, Sales Manager shall have the title
of Regional Vice President and shall have a position as a member of the Board of
Directors of PSMI and a position as a member of the Board of Directors of its
parent, PSM Holdings, Inc.

10.           Compensation.

a.           Manager’s compensation for services rendered pursuant to this
Agreement is controlled and limited by the terms and conditions of Exhibit A to
this Agreement which is incorporated herein by reference.

b.           Manager shall be paid as a W-2 Manager on a semi-monthly basis, or
as otherwise agreed.  PSMI shall make deductions for federal, state and local
taxes, Social Security, state unemployment insurance and other deductions as
required by state or federal law, or as agreed by the parties.

c.     There are no benefits to which Manager is entitled other than those
specifically referred to in this Agreement or otherwise authorized in writing by
PSMI.  In the event Manager resigns or is terminated for any reason other than
Termination for Cause (pursuant to Section 3(b)) and the Branch Office remains
open, he or she shall receive his or her regular commission on all mortgage
loans that close within thirty (30) days from the date the Manager resigns or is
terminated.  No commissions will be paid on mortgage loans closed after thirty
(30) days have elapsed.  In the event Manager resigns or is terminated for any
reason other than Termination for Cause and the Branch Office is simultaneously
closed, Manager shall receive his or her regular compensation as described in
Exhibit A after all of the business and obligations of the Branch Office have
been fully satisfied, as set forth in the Company Policies in effect at the time
of termination, subject to applicable federal, state or local law.

11.           Confidential Information.

a.           Manager hereby acknowledges, understands and agrees that all
“Confidential Material,” as defined below, is the exclusive and confidential
property of PSMI which shall at all times be regarded, treated and protected as
such in accordance with this Section 8.  Manager acknowledges that all such
Confidential Material is in the nature of a trade secret.  For purposes of this
Agreement, “Confidential Material” means information, which is available to or
used in the business of Manager and (i) is proprietary to, about or created by
PSMI, (ii) gives PSMI a competitive business advantage or the opportunity of
obtaining such advantage or the disclosure of which would be detrimental to the
interests of PSMI, or (iii) is designated as Confidential Material by PSMI, is
known by Manager to be considered confidential by PSMI, or from all the relevant
circumstances should reasonably be assumed by Manager to be confidential and
proprietary to PSMI.
 
 
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b.           Such Confidential Material includes, without limitation, the
following types of information and other information of a similar nature
(whether or not reduced to writing or designated as confidential):

i.
 
Internal personnel and financial information of PSMI, purchasing and internal
cost and revenue information, internal service and operational manuals, computer
software and systems and the manner and methods of conducting the business of
PSMI;

ii.
 
PSMI personnel names and contact information;

iii.
 
Manager’s compensation arrangements with PSMI;

iv.
 
Training and educational materials provided by PSMI to Manager;

v.
 
Marketing materials and/or marketing plans provided by PSMI to Manager; and

vi.
 
Confidential and proprietary information provided to PSMI by any actual or
potential customer, or other third party (including businesses, consultants and
other entities and individuals), and shall include, without limitation, all of
the customer’s “non-public personal information,” as that term is defined under
the Gramm-Leach-Bliley Act of 1999 and any amendments thereto.

c.           As a consequence of Manager’s acquisition or anticipated
acquisition of Confidential Material, Manager shall occupy a position of trust
and confidence with respect to the affairs and business of PSMI.  In view of the
foregoing and of the consideration to be provided to Manager, Manager agrees
that it is reasonable and necessary that Manager make each of the following
covenants:

i.
 
At any time during the term of this Agreement and thereafter, except as required
by law, Manager shall not disclose Confidential Material to any person or
entity, either inside or outside of PSMI, other than as necessary in carrying
out the business of Manager, without first obtaining PSMI’s prior written
consent (unless such disclosure is compelled pursuant to court orders or
subpoena, and at which time Manager shall give immediate notice of such
proceedings to PSMI).

ii.
 
At any time during the term of this Agreement and thereafter, Manager shall not
use, copy or transfer Confidential Material other than as necessary in carrying
out the business of Manager, without first obtaining PSMI’s prior written
consent.

iii.
 
Upon termination of this Agreement, Manager shall promptly deliver to PSMI (or
its designee) all written materials, records, software and documents made by
Manager or which came into his/her possession prior to or during the term of
this Agreement, concerning the business and affairs of PSMI, including, without
limitation, all materials containing Confidential Material.

 
 
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12.           Mediation/Governing Law.  In the event any dispute or disagreement
arises in connection with any interpretation of this Agreement, or the
employment of Manager, which cannot be resolved by the parties, each party
agrees that before any litigation or legal administrative proceeding is
initiated, such dispute or disagreement shall be submitted to non-binding
mediation in accordance with the employment mediation procedures of the American
Arbitration Association in Roswell, New Mexico except that if PSMI seeks
emergency, injunctive or other equitable relief against Manager, PSMI shall not
be required to mediate the underlying or any related dispute or
disagreement.  If the parties have not mutually agreed to resolve the dispute or
disagreement within sixty (60) days after mediation is requested, then either
party may pursue its remedies otherwise.  The laws of the State of New Mexico
shall govern the interpretation of this Agreement and the rights and obligations
of the parties to it.  The prevailing party shall be entitled to recover its
reasonable attorneys’ fees and costs from the non-prevailing party as determined
by a court of competent jurisdiction hearing the underlying dispute.  Nothing in
this Section shall be deemed to prevent a party from seeking emergency
injunctive relief in any court of competent jurisdiction to protect its rights,
provided that once that party’s application for such relief has either been
granted or denied, mediation shall commence pursuant to this Section.

13.           Severability.  A court shall consider the terms and conditions of
this Agreement to be severable so that the invalidity or unenforceability of any
of its terms, conditions or clauses shall not invalidate or render unenforceable
the any of the remaining terms or provisions contained in this Agreement, which
shall remain in full force and effect as if such invalid or unenforceable
provision had never been contained herein.

14.           Notices.  Any notice given under this Agreement shall be in
writing and shall only be deemed proper notice if served personally, by
overnight courier, or by registered or certified first class mail with return
receipt requested, and addressed to the to the other party hereto at its address
set forth below, or such other address as such party may from time-to-time
designate by written notice, given in accordance with the terms of this Section
11.

If to PSMI:             Compliance Officer
PRIMESOURCE MORTGAGE, INC.
1112 North Main Street
Roswell, NM 88201

If to Manager, to the last address of record on file with PSMI.

15.           Assignment.  This Agreement shall be binding on and shall inure to
the benefit of any successor(s) or assign(s) of PSMI and shall terminate on the
death or disability of Manager.  Except as otherwise expressly set forth in this
Agreement, Manager shall not assign, transfer or share his or her
responsibilities under this Agreement, in whole or in part, to or with any other
person, firm, corporation or other entity without the express prior written
consent of PSMI, nor shall he or she delegate any of his or her duties or
responsibilities under this Agreement.

16.           Waiver.  PSMI’s failure to exercise any rights or privileges
granted to it pursuant to this Agreement is not and shall not be construed as a
waiver any such rights or privileges.  Any waiver must be in writing in order to
be enforceable against PSMI.
 
 
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17.           Headings.  Section and Paragraph headings are used herein for
convenience only and shall not be used to interpret any provision of this
Agreement.

18.           Cooperation.  At all times during and after separation of
employment, the parties hereto shall cooperate in effecting an orderly
transition of the business contemplated by this Agreement to avoid any
interruption in the handling of the business contemplated by this Agreement.

19.           Survival.  Notwithstanding anything herein to the contrary,
Sections 4(d), 4(e), 6(c) - (e), 7(c), 8, 9, 10, 11, 12, 13, 14, 15, 16 and 17
shall survive termination of this Agreement and/or termination or resignation of
Manager’s employment with PSMI.

20.           Entire Agreement.  This Agreement contains the entire
understanding between Manager and PSMI and supersedes any prior agreements,
written or oral, respecting the subject matter of this Agreement.  This
Agreement may not be modified or altered in any way except by a written addendum
signed by the parties specifically referring to this Agreement and incorporating
this Agreement by reference.

 
IN WITNESS WHEREOF the parties have executed the foregoing Agreement effective
the 1st day of January, 2013.

REGIONAL VICE PRESIDENT AND
SALES MANAGER
PRIMESOURCE MORTGAGE, INC.

/s/ James D. Pulsipher                             
By:  Jeffrey R. Smith                                  

 
JEFFREY R. SMITH

Print Name:       JAMES D. PULSIPHER                                          
Title:           PRESIDENT & CEO

Dated:  12/21/12                                        
 Dated:  12/21/12                                         

 
 
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EXHIBIT A

Sales Manager/Loan Originator/Regional Vice President (“LO/RVP”) Compensation
Plan

A.
Compensation

LO/RVP’s compensation shall be determined and calculated in accordance with this
Exhibit A.  In no case will the LO/RVP’s compensation vary based on the terms or
conditions of a loan other than the amount of the loan extended to the
consumer.  For each pay period, LO/RVP shall earn compensation equal to the
greater of (1) a Guaranteed Minimum or (2) Commission.

Notwithstanding anything to the contrary herein:  (1) the timing of payments of
compensation shall at all times be subject to PSMI’s regular payroll practices
in effect from time to time; and (2) at all times LO/RVP shall receive no less
than the applicable minimum wage, plus applicable overtime premiums, if any, for
any hours worked in each workweek.

Guaranteed Minimum
LO/RVP shall be paid either the federal minimum wage or the minimum wage
required by the laws of the state in which the PSMI branch office where LO/RVP
is assigned and employed is located, whichever is higher, for all hours worked
up to forty (40) hours per week, plus overtime premiums at the applicable
regular rate for each hour of overtime worked, if any, in that workweek
(“Guaranteed Minimum”).  Payment of this Guaranteed Minimum shall be calculated
based on timecards submitted and signed by LO/RVP, recording and certifying the
hours worked by LO/RVP for the pay period in question.  Each timecard shall be
signed by LO/RVP’s Branch Manager and submitted to PSMI’s corporate office in
accordance with PSMI procedures.

 For all hours worked in excess of forty (40) hours per week in a given pay
period, LO/RVP shall be entitled to overtime compensation, in the amount of one
and one half times the LO/RVP’s regular pay rate for that pay period.

LO/RVP hereby agrees to adhere to the work schedule approved by his or her
immediate supervisor (i.e., the Branch Manager of the PSMI branch office where
LO/RVP is employed) and may not work overtime in any pay period without the
prior express written permission of LO/RVP’s immediate supervisor.

Commission Rate
PSMI shall pay LO/RVP a “Commission” which is defined as a semi-monthly payment
of the Basis Points (bps) corresponding to the aggregate volume of Closed Loans
originated by LO/RVP during the month, as set forth in the tiers below (the
“Commission Rate”).
 
 
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Monthly Closed Loan Volume Commission Rate
(Specified in Basis Points (bps))

 
In-House Loans
Brokered Loans
$0 - $500,000.00
120 bps
80 bps
$500,001 - $1,500,000*
125 bps
80 bps
$1,500,001 and above
135 bps
80 bps

* More than one (1) loan must be included in the total volume to reach the next
volume tier (e.g., the Commission Rate for originating one $550,000 loan will be
the Basis Points corresponding to the lowest volume tier, not the second tier,
even though the total volume for the month exceeds the dollar amount required to
reach the second tier).

From time to time, upon departure of a LO/RVP from employment with PSMI, PSMI
may assign to LO/RVP an active loan application file that was initiated but was
not closed by such previously employed PSMI LO/RVP.  In such cases, LO/RVP shall
be paid a Commission Rate equal to 25 Basis Points for each such assigned file
that results in a Closed Loan. 
 
 
Monthly Sales Manager Bonus
In addition to the compensation described herein, LO/RVP may be eligible for a
monthly dollar volume bonus (“Bonus”) based on the aggregate dollar volume of
Closed Loans in the Grand Junction Office. To be eligible for a Bonus, LO/RVP
must meet all of the following performance standards:

 
1.
Achieve Minimum monthly Office Closed Loan dollar volume in excess of $3
million;

 
2.
Loan quality measured by the accuracy and completeness of loan application and
supporting documentation when given to underwriting;

 
3.
Achieve a minimum pull through ratio of 70%.

 
4.
Branch Office efficiency.

Notwithstanding the foregoing, PSMI’s evaluation of LO/RVP’s performance
standards will not take into consideration the terms or conditions of the loans
originated by LO/RVP.
If LO/RVP is eligible to receive a Bonus as set forth above, PSMI will pay
LO/RVP an amount equal to twelve and one-half (12.5) Basis Points of the
principal amount of the credit extended on all Closed Loans for such payment
period in cash or a stock equivalent.  The stock is comprised of PSM Holdings,
Inc. common stock and is conditioned upon a six (6) month vesting period, which
begins at the time of receipt by LO/RVP.  Bonuses will only be paid to a LO/RVP
actively employed by PSMI at the end of the month for which the Bonus is
calculated.

Quarterly Loan Originator Bonus
In addition to the compensation described herein, LO/RVP may be eligible for a
quarterly dollar volume bonus (“Bonus”) based on the aggregate dollar volume of
Closed Loans during a calendar quarter, beginning on January 1, April 1, July 1
and October 1 of each year.  To be eligible for a Bonus, LO/RVP must meet all of
the following performance standards:

 
5.
Originate an aggregate Closed Loan dollar volume in excess of $3 million for the
quarterly period;

 
6.
Loan quality measured by the accuracy and completeness of loan application and
supporting documentation when given to underwriting;

 
7.
Achieve a minimum pull through ratio of 70%.

 
 
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Notwithstanding the foregoing, PSMI’s evaluation of LO/RVP’s performance
standards will not take into consideration the terms or conditions of the loans
originated by LO/RVP.  If LO/RVP is eligible to receive a Bonus as set forth
above, PSMI will pay LO/RVP, at the sole discretion of PSMI, an amount equal to
five (5) Basis Points of the principal amount of the credit extended on all
Closed Loans for such payment period in cash or a stock equivalent.  The stock
is comprised of PSM Holdings, Inc. common stock and is conditioned upon a six
(6) month vesting period, which begins at the time of receipt by
LO/RVP.  Bonuses will only be paid to a Loan Originator actively employed by
PSMI at the end of the quarter for which the Bonus is calculated.

Override
 
In addition to the Commission and Bonus payments described above, PSMI will pay
an “Override” to LO/RVP which is defined as a monthly payment equal to twelve
and one-half (12.5) Basis Points (bps) of the of the principal amount of the
credit extended for all Closed Loans originated by PSMI LO/RVPs located in
branch offices assigned to LO/RVP and designated by Corporate Management in
writing wherein LO/RVP oversees and monitors the work of said assigned PSMI
LO/RVPs and while said assigned PSMI LO/RVPs are under LO/RVP’s supervision and
direction.  Override will only be paid to a LO/RVP actively employed by PSMI at
the end of the month for which the Override is calculated.

Recruiting Compensation

In addition to compensation described above, LO/RVP will receive production
overrides on monthly closed loan volume of additional branch offices for which
the LO/RVP is directly responsible for introducing to the PSMI, which become and
continue as a PSMI branch office and which achieve a monthly minimum closed loan
volume of $3,000,000.00 (“New Branch”).  During the first year of the New Branch
operations, LO/RVP will receive 7.5 basis points of said monthly closed loan
volume; 5 basis points during the second year; and 2.5 basis points during the
third year after which no basis points will be paid. Recruiting Compensation
will only be paid to a LO/RVP actively employed by PSMI at the end of the month
for which the Compensation is calculated.

Calculation
PSMI will pay a Commission to LO/RVP for every Closed Loan the LO/RVP
originates.  Except as otherwise set forth in this Agreement including this
Exhibit A, LO/RVP’s “Commission” for a payment period equals:
(1)           a fixed percentage (i.e., the Commission Rate) of the principal
amount of the credit extended on all Closed Loans for such period less
(2)           any amounts previously paid to LO/RVP for the Guaranteed Minimum
not already taken into account by a prior calculation less
(3)           any amounts for Expenses generated by LO/RVP.

Definitions
For purposes of this Exhibit A:

“Basis Point” means an amount equal to one hundredth of one percentage point
(0.01%) of the gross loan amount stated in the note at settlement.
 
 
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“Closed Loan” means a consumer-purpose, closed-end residential mortgage loan (a)
that is closed and funded in accordance with Applicable Requirements, in the
period in which the Commission is calculated; and (b) that is not unfunded,
cancelled or rescinded for any reason within five (5) days after settlement.

“Expenses” include marketing expenses, personal expenses (e.g., personal copies,
faxes and phone calls made with PSMI equipment) and certain other expenses, as
provided in the Company Policies and as permissible under applicable local,
state and federal laws.

An “In-House Loan” is a Closed Loan in which PSMI is named the lender on the
note and in which the funds provided for settlement of the transaction were
either from PSMI’s own resources or from PSMI having drawn upon a bona fide
warehouse line of credit.

A “Brokered Loan” is a Closed Loan in which the funds provided for settlement of
the transaction were neither from PSMI’s own resources, nor from PSMI having
drawn upon a bona fide warehouse line of credit.

B.
Company Referral

LO/RVP will receive a fee in the amount of $350.00 (“Company Referral Fee”) for
every Closed Loan that LO/RVP refers to another LO/RVP employed by PSMI via the
Licensed Branch Manager and where LO/RVP does not originate, or participate in
the origination of, the referred Closed Loan.  LO/RVP shall promptly refer all
applications for loans secured by property in states in which LO/RVP is not
licensed as a LO/RVP to a PSMI Branch Manager and shall not perform any
origination activities in connection with the loan.  The referred to Branch
Manager will register the referral within Encompass at the time of
origination.  The Company Referral Fee shall be paid after the loan is closed
and funded in accordance with Applicable Requirements in the period in which the
Company Referral Fee is calculated, in accordance with the Payment Schedule for
Commission payments set forth in the LO/RVP’s compensation agreement or as
otherwise provided in PSMI’s payroll schedule, as may be revised from time to
time.  Company Referral Fees shall not be paid in connection with loans to be
secured by property in New Hampshire, Nevada or Utah, or as otherwise prohibited
by applicable law. 

C.           Employee Advances
From time to time in its sole discretion, PSMI may grant LO/RVP an advance on
compensation for services rendered pursuant to this Agreement.  Such advance
shall be secured by amounts payable to LO/RVP by PSMI hereunder and by amounts
which later become payable.

PSMI, within its discretion, may provide LO/RVP with an advance in an amount
determined by PSMI per loan application registered with PSMI by LO/RVP.  Such
advance shall be payable at the first pay date of each month and shall be based
on all applications registered with PSMI for the preceding calendar month.  This
advance option is subject to change or elimination at the discretion of PSMI,
from time to time and without prior notice to LO/RVP.  LO/RVP hereby authorizes
PSMI to deduct from the undersigned’s compensation under the Agreement all prior
advances.  In the event that this Agreement is terminated in accordance with the
provisions hereof, the unpaid balance of the advance shall be due and payable
within thirty (30) days of termination of the Agreement.
 
 
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D.           Payment Schedule
LO/RVP shall be paid on a monthly basis, and PSMI pay dates shall fall on the
15th of each month (or, if such day falls on a weekend or holiday, on the first
day immediately preceding such day that is not a weekend or holiday), or as
otherwise set forth in the Company Policies or decided by PSMI, within PSMI’s
sole discretion and subject to applicable laws.  At the time of this Agreement,
the following pay schedule applies:

Commissions, Bonuses, and Overrides:  Payments for Closed Loans earned will be
paid on the 15th of the following month.

Salary:  For the Guaranteed Minimum, including authorized overtime compensation,
payment for hours worked during the pay period shall be made on the immediately
following pay date after the end of each month.

E.            Changes to the Compensation Plan
From time to time, changes to the business will necessitate a review and
revision of LO/RVP’s compensation plan.  LO/RVP’s compensation plan that is in
effect on the date PSMI receives a loan application will be considered the plan
that is in effect for that loan throughout the application and funding process
of the loan.  LO/RVP’s compensation plan at application will be the basis for
LO/RVP’s compensation on that loan, regardless of whether LO/RVP’s compensation
plan has been revised subsequent to receipt of the application.

LO/RVP and PSMI hereby agree to LO/RVP’s compensation as set forth in this
Exhibit A, which shall be effective as of ­­­­­­­­­­­­­­­­January 1, 2013.
 
LO/RVP
PRIMESOURCE MORTGAGE, INC.

 
  /s/ James D. Pulsipher                        
By:  /s/ Jared Peterson                             

 
Print Name:  James D. Pulsipher    
Title: BRANCH MANAGER

Dated:   12/21/12                                   
Dated:   12/21/12                                        

 
PRIMESOURCE MORTGAGE, INC.

 
By:  /s/ Jeffrey R. Smith                            

JEFFREY R. SMITH
 

 
Title: PRESIDENT & CEO

 
Dated: 12/21/12                                          

 
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