Exhibit 10.1

EMPLOYMENT AGREEMENT

This Employment Agreement (this “Agreement”), is entered into as of January 12,
2015 (the “Effective Date”), between Michael R. Dunn (“Employee”) and Regional
Management Corp., a Delaware corporation (the “Corporation”).

RECITALS

A. The Corporation believes that the future growth, profitability and success of
the business of the Corporation will be significantly enhanced by the continued
employment of Employee as Chief Executive Officer of the Corporation.

B. The Corporation desires to provide Employee with appropriate incentives and
rewards related to the performance by Employee and to encourage the continued
employment of Employee in the service of the Corporation, and the Employee
desires to continue such employment, on the terms and conditions of this
Agreement, from and after the date of this Agreement.

C. The Corporation and the Employee desire to enter into an employment
agreement, as evidenced in this Agreement, to reflect the terms of the
Employee’s employment.

Now, therefore, the parties hereto hereby agree as follows:

I. DEFINITIONS

1.1 Definitions. In addition to terms defined elsewhere in this Agreement, for
purposes of this Agreement, the following terms will have the following
respective meanings when used in this Agreement with initial capital letters:

(a) “Affiliate”: with respect to any Person, any other Person directly or
indirectly controlling, controlled by or under common control with such Person.
For purposes of this definition, “control,” when used with respect to any
Person, means the possession, directly or indirectly, of the power to direct or
cause the direction of the management and policies of any such Person, whether
through the ownership of voting securities, by contract or otherwise, and the
terms “controlling” and “controlled” have the respective meanings correlative to
the foregoing. With respect to any natural Person, “Affiliate” will also include
such Person’s grandparents, any descendants of such Person’s grandparents, the
grandparents of such Person’s spouse and any descendants of the grandparents of
such Person’s spouse (in each case, whether by blood, adoption or marriage).

(b) “Agreement”: as defined in the introductory paragraph.

(c) “Annual Incentive Plan”: the Annual Incentive Plan of the Corporation or any
successor plan thereto.

(d) “Board”: the Board of Directors of the Corporation.

(e) “Bonus”: as defined in Section 2.4(b). “Annual Bonus” and “Completion Bonus”
shall have the meanings ascribed to such terms in Section 2.4(b) herein.

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(f) “Business”: the business of providing installment, automobile purchase and
retail purchase loans and related payment protection insurance to consumers.

(g) “Cause”: (i) the willful or grossly negligent material failure by Employee
to perform his duties hereunder (other than arising due to Employee’s
Disability); (ii) the conviction of Employee, or the entering into a plea
bargain or plea of nolo contendere by Employee, of any felony, any other crime
or criminal offense involving the unlawful theft or conversion of substantial
monies or other property or any fraud or embezzlement offense; (iii) personally
or on behalf of another Person, willfully receiving a benefit relating to the
Corporation or its Subsidiaries or its funds, properties, opportunities or other
assets in violation of applicable law, or constituting fraud, embezzlement or
misappropriation; (iv) the willful or grossly negligent failure by Employee to
comply substantially with any written policy of the Corporation or its
Subsidiaries that materially interferes with his ability to discharge his
duties, responsibilities or obligations under this Agreement; (v) the knowing
misstatement by Employee of the financial records of the Corporation or its
Subsidiaries or complicit actions in respect thereof; (vi) the material breach
by Employee of any of the terms of this Agreement, (vii) Employee’s habitual
drunkenness or substance abuse that interferes with his ability to discharge his
duties, responsibilities or obligations under this Agreement; (viii) the failure
to disclose material financial or other information to the Board, or (ix) the
Employee’s engagement in conduct that results in the Employee’s obligation to
reimburse the Corporation for the amount of any bonus, incentive-based
compensation, equity-based compensation, profits realized from the sale of the
Corporation’s securities or other compensation pursuant to application of the
provisions of Section 304 of the Sarbanes-Oxley Act of 2002 or Section 954 of
the Dodd-Frank Wall Street Reform and Consumer Protection Act, but, in each case
for clauses (i) through (ix) herein, only if (1) Employee has been provided with
written notice of any assertion that there is a basis for termination for Cause,
which notice shall specify in reasonable detail specific facts regarding any
such assertion, and in the case of non-willful behavior under clauses (i),
(iii), (iv) or (vi), Employee has failed to cure within 30 days of written
notice to Employee, (2) such written notice is provided to the Employee a
reasonable time before the Board meets to consider any possible termination for
Cause, (3) at or prior to the meeting of the Board to consider the matters
described in the written notice, an opportunity is provided to the Employee and
his counsel to be heard before the Board with respect to the matters described
in the written notice, (4) any resolution or other Board action held with
respect to any deliberation regarding or decision to terminate Employee for
Cause is duly adopted by a vote of a majority of the entire Board of the
Corporation at a meeting of the Board called and held and (5) Employee is
promptly provided with a copy of the resolution or other corporate action taken
with respect to such termination. No act or failure to act by Employee shall be
considered willful unless done or omitted to be done by him not in good faith
and without reasonable belief that his action or omission was in the best
interests of the Corporation. Notwithstanding the provisions of this
Section 1.1(g), “Cause” will not be deemed to have occurred solely as a result
of Employee’s failure to follow any Corporation policy or any Corporation
instruction to Employee that would permit Employee to terminate this Agreement
under Section 2.7(d) because such policy or instruction constitutes an
Involuntary Termination.

(h) “Commencement Date”: as defined in Section 2.1.

(i) “Compensation Committee”: Compensation Committee of the Board.

(j) “Confidential Information”: as defined in Section 3.2.

(k) “Corporation”: as defined in the introductory paragraph.

 

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(l) “Corporation Employee”: as defined in Section 3.5.

(m) “Corporation IP”: as defined in Section 3.1(a).

(n) “Disability”: a physical or mental incapacity as a result of which Employee
becomes unable to continue to perform fully his material duties hereunder for 90
consecutive calendar days or for shorter periods aggregating 90 or more days in
any 12-month period or upon the determination by a physician selected by the
Corporation (with the Corporation responsible for any expenses related thereto)
that Employee will be unable to return to work and perform his material duties
on a full-time basis within 90 calendar days following the date of such
determination on account of mental or physical incapacity.

(o) “Effective Date”: as defined in the introductory paragraph.

(p) “Employee”: as defined in the introductory paragraph.

(q) “Employment Period”: as defined in Section 2.1.

(r) “Estate”: as defined in Section 2.7(e).

(s) “Involuntary Termination”: the termination of Employee’s employment by
Employee which is due to (i) a material diminution of Employee’s
responsibilities, position (as Chief Executive Officer of the Corporation, its
successor or ultimate parent entity), office, title, reporting relationships or
working conditions, authority or duties; or (ii) a material adverse change in
the terms or status (including a reduction of the Employment Period) of this
Agreement; or (iii) a material reduction in the Employee’s compensation package,
including Salary, Annual Bonus opportunities or equity award opportunities
(other than a reduction in Annual Bonus opportunities or equity award
opportunities that applies to senior executive officers of the Corporation
generally or that is due, in the discretion of the Board or the Compensation
Committee, to the failure to attain performance or other business objectives),
in each case of clauses (i) through (iii) herein, without the written consent of
the Employee.

(t) “Loan Source”: as defined in Section 3.4(a).

(u) “Person”: an individual, a corporation, a partnership, a limited liability
company, an association, a trust, a joint stock corporation, a joint venture, an
unincorporated organization or any federal, state, county, city, municipal or
other local or foreign government or any subdivision, authority, commission,
board, bureau, court, administrative panel or other instrumentality thereof.

(v) “Salary”: as defined in Section 2.4(a).

(w) “Severance Period”: as defined in Section 2.7(a).

(x) “Subsidiary”: with respect to any Person, (i) any corporation of which a
majority of the total voting power of shares of stock entitled (without regard
to the occurrence of any contingency) to vote generally in the election of
directors thereof is at the time owned or controlled, directly or indirectly, by
that Person or one or more of the other Subsidiaries of that Person or a
combination thereof or (ii) any limited liability company, partnership,
association or other business entity, of which a majority of the partnership or
other similar ownership interests thereof is at the time owned or controlled,
directly or indirectly, by that Person or one or more Subsidiaries of that
Person or a combination thereof. For purposes of this definition, a Person or

 

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Persons will be deemed to have a majority ownership interest in a limited
liability company, partnership, association or other business entity if such
Person or Persons will be allocated a majority of limited liability company,
partnership, association or other business entity gains or losses, or is or
controls the managing member or general partner of such limited liability
company, partnership, association or other business entity.

(y) “Target Bonus”: as defined in 2.4(b).

(z) “Termination Date”: as defined in Section 2.1.

II. TERMS OF EMPLOYMENT

2.1 Employment Period. The Employee commenced employment effective October 30,
2014 (the “Commencement Date”). The Corporation shall continue to employ the
Employee, and the Employee agrees to continue employment with the Corporation,
upon the terms and conditions set forth in this Agreement. This Agreement shall
be effective as of the Effective Date and will terminate on December 31, 2016,
unless sooner terminated in accordance with Section 2.7. The term of this
Agreement as determined under the preceding sentence is referred to herein as
the “Employment Period.” The date on which the employment of the Executive
terminates is referred to herein as the “Termination Date.”

2.2 Duties During Employment Period. Employee will be an employee of, and serve
as the Chief Executive Officer of, the Corporation and will report directly to
the Board. In such capacity, Employee will perform such duties and exercise such
powers that are consistent with the position of Chief Executive Officer in
accordance with the Bylaws of the Corporation and as are assigned to Employee by
the Board. Employee agrees that to the best of his ability and experience he
shall at all times conscientiously perform all of his duties and obligations
under the terms of this Agreement.

2.3 Activities During Employment Period.

(a) Employee will devote his full business time, energy, ability, attention and
skill to his employment hereunder and to the Business of the Corporation and,
absent the prior written approval of the Board, which approval shall not be
unreasonably withheld, Employee will not engage in any business activity,
whether as an employee, investor, officer, director, consultant, independent
contractor or otherwise, that would interfere with his duties and
responsibilities pursuant to Section 2.2. Employee agrees to comply with all
rules and policies established by the Corporation and its Subsidiaries
throughout the Employment Period.

(b) Employee will act in accordance with laws, ordinances, regulations,
professional standards or rules of any governmental, regulatory or
administrative body, agent or authority, any court or judicial authority, or any
public, private or industry regulatory authority.

2.4 Compensation.

(a) Salary. For Employee’s services under this Agreement, the Corporation will
pay to Employee an annual base salary (“Salary”) of $500,000 (prorated for 2014
and any other partial year based on a fraction, the numerator of which shall be
the number of days employed in such year and the denominator of which shall be
365). The Board or the Compensation Committee may review the amount of Salary
from time to time and may adjust Salary upwards after any such review, with any
such upward adjustments effective as of the dates determined by the Board or the
Compensation Committee. Employee’s Salary will be payable to Employee
periodically in accordance with the normal practices of the Corporation.

 

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(b) Bonuses. For each calendar year during the Employment Period (that is, 2015
and 2016), the Employee shall be eligible for participation in the Annual
Incentive Plan with a target bonus (the “Annual Bonus,” and, together with the
Completion Bonus as defined below, each, a “Bonus,” and collectively, the
“Bonuses”) thereunder equal to no less than one hundred percent (100%) of
Employee’s Salary in effect at the beginning of the calendar year; and, provided
further, that the Employee shall be eligible for a pro rated Annual Bonus for
2014 or any other partial year based on a fraction, the numerator of which shall
be the number of days employed in 2014 and the denominator of which shall be
365. The Compensation Committee shall establish and communicate to Employee
performance criteria for the Corporation and/or Employee and one or more
objective formula(s) for determining the Annual Bonus, if any, earned by
Employee under the Annual Incentive Plan for each calendar year. Unless
otherwise addressed in Section 2.7, if Employee is employed by the Corporation
in good standing on the last day of the applicable calendar year, Employee will
be entitled to receive the Annual Bonus for such year in an amount determined in
accordance with such objective formula(s) set by the Compensation Committee
based on the actual performance of the Corporation and/or Employee relative to
the performance criteria established by the Compensation Committee for that
year. In addition, the Employee shall be eligible to earn a cash bonus (the
“Completion Bonus”) in an amount of up to $500,000, subject to the Employee’s
continued employment with the Corporation as its Chief Executive Officer from
the Effective Date through December 31, 2016. The Completion Bonus will be
payable solely at the discretion of the Compensation Committee based upon a
review of the Employee’s performance, taking into consideration those factors
that the Compensation Committee may establish or otherwise deem relevant,
including but not limited to the Employee’s contributions to the Corporation’s
financial performance and the accomplishment of the Corporation’s short-term and
long-term strategic objectives. Any Bonus due to Employee pursuant to this
Section 2.4(b) shall be paid in cash in a lump sum no later than March 14 of the
calendar year following the calendar year during which the Employee’s right to
the Bonus vests (or otherwise in a manner compliant with, or exempt from,
Section 409A of the Internal Revenue Code of 1986, as amended (the “Code”)).
Unless otherwise addressed under Section 2.7, Bonus entitlement vests and is
fully payable if Employee is employed by the Corporation on the last day of the
applicable calendar year, even if Employee is no longer employed at the time the
Bonus is scheduled to be paid.

(c) Equity Compensation.

(i) Initial Stock Award (“Stock Award”). On or as soon as practicable following
the Effective Date, the Corporation shall grant to the Employee a stock award
for such number of shares of the Corporation’s common stock as may be determined
by dividing $1,500,000 by the closing price of the Corporation’s common stock on
or as close in time as practicable to the grant date. The Stock Award shall vest
on the grant date, but the Net Shares (as defined below) subject to the Stock
Award shall be subject to a holding period ending December 31, 2016, without
regard to whether the Employee remains employed until such date, and such Net
Shares shall not be transferable prior to such date. The Stock Award shall be
subject to such other terms and conditions as may be provided under the terms of
the Corporation’s 2011 Stock Incentive Plan, as it may be amended, or any
successor plan (collectively, the “Stock Plan”), and the applicable stock award
agreement (“Stock Award Agreement”) in form acceptable to the Compensation
Committee. Without limiting the effect of the foregoing, notwithstanding any
provision of the Stock Plan or the Stock Award Agreement to the contrary, the
Stock Award

 

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Agreement shall be deemed amended to comply with the holding period requirement
provided herein such that no transfer of the Net Shares subject to the Stock
Award shall be permissible prior to December 31, 2016. For the purposes herein,
the “Net Shares” shall mean the total number of shares of the Company’s common
stock subject to the Stock Award less such number of shares of Common Stock
subject to the Stock Award that are withheld to satisfy applicable withholding
taxes (said amount not to exceed the statutory minimum withholding liability) as
determined in accordance with the terms of the Stock Plan and Stock Award
Agreement.

(ii) Nonqualified Stock Option (“NQSO”) Award. Subject to the Employee’s
continued employment from the Effective Date until the grant date, the
Corporation shall grant to the Employee a nonqualified stock option grant at the
time the Corporation makes its long-term incentive awards for 2015 to other
members of senior management. The option shall represent the right to purchase
such number of shares of the Corporation’s common stock as may be determined by
dividing $500,000 by the fair value of each option (calculated on or as close in
time as practicable to the grant date in accordance with GAAP using the
Black-Scholes option pricing model), at an exercise price per share equal to the
fair market value per share on the grant date. The option shall vest on
December 31, 2017, subject to the Employee’s continued employment from the grant
date until the vesting date or as otherwise provided in the applicable award
agreement. The term of the option will be ten years from the date of grant,
subject to earlier termination in the event the Employee’s employment
terminates. The option shall be subject to the terms of the Stock Plan and
applicable nonqualified stock option award agreement in form acceptable to the
Compensation Committee.

(iii) Performance-Contingent Restricted Stock Unit (“RSU”) Award. Subject to the
Employee’s continued employment from the Effective Date until the grant date,
the Corporation shall grant to the Employee an RSU award at the time the
Corporation makes its long-term incentive awards for 2015 to other members of
senior management. The number of shares subject to the RSU award shall be
calculated by dividing $500,000 by the closing price of the Corporation’s common
stock on or as close in time as practicable to the grant date. The RSU award
will be eligible for vesting on December 31, 2017, based upon the achievement,
if at all, of performance criteria established by the Compensation Committee and
the Employee’s continued employment from the grant date until the vesting date
or as otherwise provided in the applicable award agreement. The RSU award
(including the distribution of any shares of the Corporation’s common stock
issuable pursuant thereto) shall be subject to the terms of the Stock Plan and
applicable restricted stock unit agreement in form acceptable to the
Compensation Committee.

(iv) Cash-Settled Performance Share Award (“Performance Share Award”). Subject
to the Employee’s continued employment from the Effective Date until the grant
date, the Corporation shall grant to the Employee a Performance Share Award at
the time the Corporation makes its annual long-term incentive awards for 2015 to
other members of senior management. The Performance Share Award shall be
eligible for vesting on December 31, 2017, if and to the extent the performance
criteria established by the Compensation Committee are met and subject to the
Employee’s continued employment from the grant date until the vesting date or as
otherwise provided in the applicable award agreement. The target cash settlement
value of the Performance Share Award at vesting shall be equal to $500,000. The
Performance Share Award shall be subject to the terms of the Stock Plan and
applicable performance share award agreement in form acceptable to the
Compensation Committee.

 

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(v) For 2016, and subject to the Employee’s continued employment from the
Effective Date until the applicable grant date, the Employee shall be eligible
to receive one or more long-term incentive awards valued in the aggregate at
$1,500,000. Such equity awards shall be subject to the terms of the Stock Plan
and applicable equity award agreements in form acceptable to the Compensation
Committee and such other terms and conditions as may be established by the
Compensation Committee.

2.5 Benefits.

(a) Benefit Plans. Except as otherwise addressed in this Section 2.5, during the
Employment Period, Employee shall be entitled to participate in all pension,
medical, retirement and other benefit plans and programs generally available to
the Corporation’s other employees, provided that Employee meets all eligibility
requirements under those plans and programs. Employee shall be subject to the
terms and conditions of the plans and programs, including, without limitation,
the Corporation’s right to amend or terminate the plans and programs at any time
and without advance notice to the participants. Notwithstanding the foregoing,
Employee will not during the Employment Period be entitled to participate in any
severance pay plan of the Corporation. The Employee’s severance benefits are to
be solely as set forth in Section 2.7.

(b) Vacation; Leave. Employee shall be entitled to paid vacation time of not
less than 25 business days for each calendar year of the Employment Period (pro
rated for 2014 or any other partial year, based on a fraction, the numerator of
which shall be the number of days employed in 2014 and the denominator of which
shall be 365). Employee shall also be entitled to all paid holidays and to
reasonable personal and sick leave in accordance with the policies of the
Corporation applicable to its executive management. Unused vacation and personal
and/or sick leave may not be carried over by Employee from one calendar year to
the next. Notwithstanding the foregoing, such vacation, holidays and personal
and/or sick leave shall not accrue as a monetary liability of the Corporation.

(c) Expenses; Reimbursements. Subject to compliance with the Corporation’s
policies as from time to time in effect regarding the incurrence,
substantiation, verification and reimbursement of business expenses, the
Corporation will pay or reimburse Employee for all reasonable expenses incurred
in connection with the performance of Employee’s duties hereunder or for
promoting, pursuing or otherwise furthering the Business of the Corporation,
including Employee’s reasonable expenses for travel, entertainment and similar
items. Employee acknowledges and agrees that the provisions of Section 2.5(d)
below provide the exclusive reimbursement terms for Employee’s use of any
personal vehicles in connection with the performance of his duties as an
employee of the Corporation. All expenses eligible for reimbursements in
connection with the Employee’s employment with the Corporation must be incurred
by the Employee during the term of employment and must be in accordance with the
Corporation’s expense reimbursement policies. The amount of reimbursable
expenses incurred in one taxable year shall not affect the expenses eligible for
reimbursement in any other taxable year. Each category of reimbursement shall be
paid as soon as administratively practicable, but in no event shall any such
reimbursement be paid after the last day of the Employee’s taxable year
following the taxable year in which the expense was incurred. No right to
reimbursement is subject to liquidation or exchange for other benefits.

(d) Mileage Reimbursement; Use of Cell Phone. The Corporation will, in
accordance with the Corporation’s general personal vehicle use reimbursement
policy reimburse Employee an amount equal to $0.15 (or such higher amount as may
apply pursuant to the Corporation’s mileage reimbursement policy as it may be in
effect from time to time) for each mile he drives a

 

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personal car in connection with the performance of his duties as an employee of
the Corporation. The Corporation will provide the Employee with a cell phone
(including monthly service fees), the reasonable costs of which shall be paid by
the Corporation directly to the service provider.

2.6 Deductions and Withholdings. All amounts payable or that become payable
under this Agreement will be subject to any deductions and withholdings
previously authorized by Employee or required by law. The Employee will be
responsible for any and all taxes resulting from the benefits provided
hereunder.

2.7 Termination. The Corporation shall provide the following benefits in the
event of the termination of employment of the Employee. For clarity, (i) in the
event that the Employee is eligible to be paid the Completion Bonus as provided
in Section 2.4(b) herein, and/or (ii) in the event that the Employee’s
employment terminates for any reason after December 31, 2016, then the Employee
shall not also be entitled to receive the severance benefit in the form of the
Employee’s Salary for the Severance Period under Sections 2.7(a)(ii), 2.7(d)(ii)
or 2.7(f).

(a) Termination by the Corporation without Cause. The Corporation may terminate
Employee’s employment hereunder without Cause at any time, upon 30 calendar
days’ written notice to Employee. The Corporation may elect to pay to Employee
his portion of Salary for the notice period in lieu of permitting Employee to
continue working. If Employee is terminated by the Corporation without Cause,
the Corporation will pay to Employee (i) accrued but unpaid Salary through the
Termination Date, (ii) Employee’s Salary in effect on the Termination Date to be
paid for a period of twelve (12) months from and after the Termination Date
(such 12-month period, the “Severance Period”), (iii) a pro-rata portion of the
Annual Bonus for the year in which Employee’s Termination Date occurs, to the
extent earned (such amount to be calculated by determining the amount of the
Annual Bonus earned as of the end of the year in which the Termination Date
occurs and pro-rating such amount by the portion of such year Employee was
employed by the Corporation), plus, if Employee’s termination occurs after year
end but before the Annual Bonus for the preceding year is paid, the Annual Bonus
for the preceding year and (iv) COBRA premiums as described in Section 2.7(g).
Such Salary and Annual Bonus will be paid as and at such times as Employee would
have otherwise received his Salary and Annual Bonus had he remained an employee
of the Corporation, subject to execution of an irrevocable release as provided
in Section 4.16 and provided that such Salary shall be paid commencing with the
first payroll date that occurs on or after 45 calendar days following the
Termination Date. In addition, under the foregoing circumstances, the
Corporation will pay to Employee all unreimbursed expenses incurred by Employee
prior to such termination for which Employee is entitled to reimbursement
pursuant to and in accordance with Section 2.5(c). The payments to be made in
accordance with this Section 2.7(a) will constitute liquidated damages and
Employee will not be entitled to any other compensation from the Corporation
under this Agreement or otherwise except as provided in this Section 2.7(a).
This Agreement in all other respects will terminate on the Termination Date,
except as otherwise provided in this Agreement.

(b) Termination by the Corporation for Cause. The Corporation will have the
right to terminate Employee’s employment hereunder for Cause upon written notice
to Employee and Employee’s failure to cure during any applicable cure period as
set forth in this Agreement. If Employee’s employment is terminated for Cause,
the Corporation will pay to Employee (i) accrued but unpaid Salary through the
Termination Date (payable 45 calendar days after the Termination Date) and
(ii) all unreimbursed expenses incurred by Employee prior to the Termination
Date for which Employee is entitled to reimbursement pursuant to and in
accordance with Section 2.5(c). Upon termination of Employee’s employment
pursuant to this Section 2.7(b), except for the payments required by this
Section 2.7(b) or as required by applicable law, the

 

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Corporation will have no additional obligations to Employee hereunder or
otherwise, and except as otherwise provided in this Agreement, this Agreement
will terminate as of the Termination Date.

(c) Voluntary Termination by Employee. If Employee voluntarily terminates his
employment, the Corporation will pay to Employee (i) accrued but unpaid Salary
through the Termination Date, (ii) if Employee’s termination occurs after year
end but before the Annual Bonus for the preceding year is paid, the Annual Bonus
for the preceding year (payable in the case of (i) and (ii) 45 calendar days
after the Termination Date) and (iii) all expenses incurred by Employee prior to
the Termination Date for which Employee is entitled to reimbursement pursuant to
and in accordance with Section 2.5(c). Upon termination of Employee’s employment
pursuant to this Section 2.7(c), except for the payments required by this
Section 2.7(c) or as required by applicable law, the Corporation will have no
additional obligations to Employee hereunder or otherwise, and, except as
otherwise provided in this Agreement, this Agreement will terminate.

(d) Involuntary Termination by Employee. If Employee’s employment is terminated
as a result of an Involuntary Termination, the Corporation will pay to Employee
(i) accrued but unpaid Salary through the Termination Date, (ii) Employee’s
Salary in effect on the Termination Date for the Severance Period, (iii) a
pro-rata portion of the Annual Bonus for the year in which Employee’s
Termination Date occurs, to the extent earned (such amount to be calculated by
determining the amount of the Annual Bonus earned as of the end of the year in
which the Termination Date occurs and pro-rating such amount by the portion of
such year Employee was employed by the Corporation), plus, if Employee’s
termination occurs after year-end but before the Annual Bonus for the preceding
year is paid, the Annual Bonus for the preceding year and (iv) COBRA premiums as
described in Section 2.7(g). Such Salary and Annual Bonus will be paid as and at
such times as Employee would have otherwise received his Salary and Annual Bonus
had he remained an employee of the Corporation, subject to execution of an
irrevocable release as provided in Section 4.16 herein and provided that such
Salary shall be paid commencing with the first payroll date that occurs on or
after 45 calendar days following the Termination Date. In addition, under the
foregoing circumstances, the Corporation will pay to Employee all unreimbursed
expenses incurred by Employee prior to such termination for which Employee is
entitled to reimbursement pursuant to and in accordance with Section 2.5(c). The
payments to be made in accordance with this Section 2.7(d) will constitute
liquidated damages and Employee will not be entitled to any other compensation
from the Corporation under this Agreement or otherwise except as provided in
this Section 2.7(d). This Agreement in all other respects will terminate on the
Termination Date, except as otherwise provided in this Agreement.

(e) Termination by Death of Employee. If Employee dies during the Employment
Period, the Corporation will pay to such Person or Persons as Employee may
designate in writing or, in the absence of such designation, to the estate of
Employee (as the case may be, the “Estate”) the sum of (i) accrued but unpaid
Salary earned prior to Employee’s death, (ii) expenses incurred by Employee
prior to his death for which Employee is entitled to reimbursement pursuant to
and in accordance with Section 2.5(c), and (iii) a pro-rata portion of the
Annual Bonus for the year in which Employee’s death occurs, to the extent earned
(such amount to be calculated by determining the amount of the Annual Bonus
earned as of the end of the year in which the death occurs and pro-rating such
amount by the portion of such year Employee was employed by the Corporation),
plus, if Employee’s death occurs after year-end but before the Annual Bonus for
the preceding year is paid, the Annual Bonus for the preceding year. The
payments described in clauses (i) and (ii) in the preceding sentence will be
made within 45 calendar days following the date of Employee’s death. Any Annual
Bonus will be paid as and at

 

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such times as Employee would have otherwise received his Annual Bonus had he
remained an employee of the Corporation. This Agreement in all other respects
will terminate upon the death of Employee and all rights of Employee and his
heirs, legatees, descendants, testamentary executors and testamentary
administrators regarding compensation and other benefits under this Agreement
shall cease.

(f) Termination for Disability. The Corporation will have the right to terminate
Employee’s employment hereunder at any time upon the Disability of Employee
during the Employment Period. If Employee’s employment is terminated because of
Employee’s Disability, the Corporation will pay to Employee an amount equal to
Employee’s Salary in effect on the Termination Date for the Severance Period;
provided, however, that such payment of Salary will be reduced by the amount of
any disability benefits paid to Employee pursuant to any disability insurance,
plan or policy then in effect by the Corporation applicable to Employee. Such
Salary will be paid to Employee as and at such times as Employee would have
otherwise received his Salary had he remained an employee of the Corporation. In
addition, the Corporation will pay to Employee the sum of (i) accrued but unpaid
Salary prior to the Employee’s Disability, (ii) all expenses incurred by
Employee prior to his termination due to Disability for which Employee is
entitled to reimbursement pursuant to and in accordance with Section 2.5(c) and
(iii) a pro-rata portion of the Annual Bonus for the year in which Employee’s
termination due to Disability occurs, to the extent earned (such amount to be
calculated by determining the amount of the Annual Bonus earned as of the end of
the year in which the Employee’s termination due to Disability occurs and
pro-rating such amount by the portion of such year Employee was employed by the
Corporation), plus, if Employee’s termination due to Disability occurs after
year-end but before the Annual Bonus for the preceding year is paid, the Annual
Bonus for the preceding year. The payments described in clauses (i) and (ii) in
the preceding sentence will be made within 45 calendar days following the date
of the Employee’s termination due to Disability. Any Annual Bonus will be paid
as and at such times as Employee would have otherwise received his Annual Bonus
had he remained an employee of the Corporation. This Agreement in all other
respects will terminate upon the termination of the Employee’s employment due to
Disability, except as otherwise provided in this Agreement.

(g) Payment of COBRA Premiums; No Effect on Vested and Accrued Benefits. During
the Severance Period, the Corporation shall reimburse Employee’s COBRA premiums
for continuation coverage under the Corporation’s group medical plan; provided,
however, that if at any time during the Severance Period Employee becomes
entitled to receive health insurance from a subsequent employer or is no longer
eligible to receive COBRA continuation coverage under the Corporation’s group
medical plan, the Corporation’s obligation to continue to reimburse the Employee
for his COBRA premium payments shall terminate immediately. Such reimbursement
shall be paid to the Employee on the 20th day of the month immediately following
the month in which the Employee timely remits the required COBRA premium
payment. Notwithstanding anything to the contrary herein and subject to the
terms of any benefit plan or program of the Corporation, no termination of
Employee’s employment with the Corporation shall in any manner whatsoever result
in any termination, curtailment, reduction or cessation of any vested benefits
or other entitlements to which Employee is entitled under the terms of any such
benefit plan or program of the Corporation in respect of which Employee is a
participant as of the Termination Date.

 

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III. COVENANTS

3.1 Patents, Inventions and Other Intellectual Property.

(a) If at any time during the Employment Period or prior thereto at any time
that Employee was an employee, agent, director or officer of or consultant to
the Corporation or its Subsidiaries, Employee, whether alone or with any other
Person, makes, discovers, produces, conceives or first reduces to practice any
invention, process, development, design or improvement that relates to, affects,
or, in the opinion of the Board, is capable of being used or adapted for use in
or in connection with the Business or any product, process or intellectual
property right of the Corporation or its Subsidiaries, (i) Employee acknowledges
and agrees that such invention, process, development, design or improvement
(collectively, “Corporation IP”) will be the sole property of the Corporation or
such Subsidiaries, as appropriate, and is hereby irrevocably assigned by
Employee to the Corporation or such Subsidiaries, as appropriate, and
(ii) Employee will immediately disclose in confidence all Corporation IP to the
Corporation in writing.

(b) Employee will, if and when reasonably required to do so by the Corporation
(whether during the Employment Period or thereafter), at the Corporation’s
expense and, if after the expiration of the Employment Period, subject to
Employee’s availability and reimbursement by the Corporation of Employee’s
reasonable out-of-pocket expenses and payment to Employee of a reasonable per
diem to compensate Employee for time spent in connection therewith: (i) apply,
or join with the Corporation or a Subsidiary thereof, as appropriate, in
applying, for patents or other protection in any jurisdiction in the world for
any Corporation IP; (ii) execute or procure to be executed all instruments, and
do or procure to be done all things, that are necessary or, in the opinion of
the Corporation, advisable for vesting such patents or other protection in the
name of the Corporation or a Subsidiary thereof or any nominee thereof, or
subsequently for renewing and maintaining the same in the name of the
Corporation, a Subsidiary thereof or its nominees; and (iii) assist in defending
any proceedings relating to, or to any application for, such patents or other
protection.

(c) Employee irrevocably appoints the Corporation as his attorney in his name
(with full power of substitution and resubstitution) and on his behalf to
execute all documents, and do all things, required in order to give full effect
to the provisions of this Section 3.1.

3.2 Confidentiality.

(a) Employee acknowledges that prior to and during the Employment Period,
Employee has been given and will continue to have, in connection with the
conduct of the Business, access and exposure to trade secrets and confidential
information in written, oral, electronic and other form regarding the
Corporation and its Subsidiaries, and their respective Affiliates, businesses,
operations, equipment, products and employees (“Confidential Information”),
including, but not limited to:

(i) the identities of customers and key accounts and relationships and potential
customers and key accounts and relationships, including, without limitation, the
identity of customers and key accounts and potential customers and key accounts
cultivated or maintained by Employee while providing services at the Corporation
or its Subsidiaries or that Employee cultivates or maintains while providing
services at the Corporation or its Subsidiaries using the Corporation’s (or its
Subsidiaries’) products, name and infrastructure, and the identities of contact
persons at those customers and key accounts and potential customers and key
accounts;

(ii) the particular preferences, likes, dislikes and needs of those customers
and key accounts and relationships, and potential customers and key accounts and
contact persons with respect to service types, financing terms, pricing, sales
calls, timing, sales terms, rental terms, lease terms, service plans, and other
marketing terms and techniques;

 

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(iii) the business methods, practices, strategies, forecasts, pricing and
marketing techniques;

(iv) the identities of brokers, licensors, vendors and other suppliers and the
identities of contact persons at such brokers, licensors, vendors and other
suppliers;

(v) the identities of key sales representatives and personnel and other
employees;

(vi) advertising and sales materials, research, technology, intellectual
property rights, training materials and techniques, computer software and
related materials;

(vii) other facts and financial and other business information concerning such
Persons or relating to their business, operations, financial condition, results
of operations and prospects; and

(viii) all other information the Corporation or its Subsidiaries try to keep
confidential and that has commercial value or is of such a nature that its
unauthorized disclosure would be detrimental to the Corporation’s or any of its
Subsidiaries’ interests.

(b) Notwithstanding the foregoing, “Confidential Information” will not include
information that is approved for public release by the Corporation or its
subsidiaries or information that Employee can demonstrate (i) is already in or
has subsequently entered the public domain, other than as a result of any breach
of this Agreement by Employee, (ii) was in the possession of or known to
Employee prior to Employee’s employment with the Corporation and is not subject
to confidentiality restrictions, (iii) was obtained from a third party not in
violation of any agreement with, or duty of confidentiality to, Corporation or
(iv) was independently developed by the Employee without use of or reference to
Corporation’s Confidential Information.

(c) During the Employment Period and thereafter, Employee will not at any time,
except as directed by the Corporation, use for himself or others, directly or
indirectly, any such Confidential Information, and, except as required by law or
as directed by the Corporation, Employee will not disclose such Confidential
Information, directly or indirectly, to any other Person or use, lecture upon or
publish any of the Confidential Information.

(d) All physical property and all notes, memoranda, files, records, writings,
documents and other materials of any and every nature, written or electronic,
that Employee has prepared, developed or received, or will prepare, develop or
receive in the course of his association with the Corporation or its
Subsidiaries and that relate to or are useful in any manner to the Business or
any other business now or hereafter conducted by the Corporation or its
Subsidiaries, are and will remain the sole and exclusive property of such
Persons. Except as may be required in the performance of Employee’s duties under
this Agreement, Employee will not remove from such Person’s premises any such
physical property, the original, “soft copy” or any reproduction of any such
materials nor the information contained therein, and all such physical property,
materials and information in his possession or under his custody or control
will, on the Termination Date, be immediately turned over to the Corporation or
its Subsidiaries.

 

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3.3 Covenant Not to Compete. Employee agrees that during his employment with the
Corporation, and for a period of two (2) years immediately following the
termination thereof, whether voluntary or involuntary, he shall not, directly,
or indirectly on behalf of himself or any other person or entity, whether on a
full-time, part-time, advisory, consulting or contractor basis, (a) work for, or
otherwise engage in any business activity, in a management capacity, or in any
other capacity similar to his position with the Corporation, (b) operate, or
(c) have an ownership interest in, any entity which provides installment,
automobile purchase and retail purchase loans to consumers, that are competitive
with those provided by the Corporation or its Subsidiaries, within a twenty-five
(25)-mile radius of any office of the Corporation or its Subsidiaries. This
covenant not to compete, however, shall not prevent Employee from owning,
without more, up to one percent (1%) of the stock of any entity whose securities
are listed on a national or regional securities exchange or have been registered
under Section 12(b) or (g) of the Securities Exchange Act of 1934, as amended.

3.4 Covenant Not to Solicit Competitive Consumer Finance Loans Through Loan
Sources.

(a) Employee agrees that during his employment with the Corporation, and for a
period of two (2) years immediately following the termination thereof, whether
voluntary or involuntary, he shall not, directly or indirectly, on behalf of
himself or any other person or entity, solicit the provision of, or otherwise
provide, installment, automobile purchase or retail purchase loans to consumers,
that are competitive with those provided by the Corporation or its Subsidiaries,
through any Loan Source. “Loan Source,” as used in this Agreement, shall mean
any automobile dealership, online credit application network, retailer or other
source of such loans for the Corporation, or its Subsidiaries, that Employee had
contact with, or learned Confidential Information about, through his employment
with the Corporation, at any time during the last year of his employment with
the Corporation.

(b) Employee agrees that during his employment with the Corporation, and for a
period of two (2) years immediately following the termination thereof, whether
voluntary or involuntary, he shall not, directly or indirectly, on behalf of
himself or any other person or entity, solicit any Loan Source, including
dealers and retailers, with which the Corporation has developed business
relationships, and through which the Corporation offers its products and
services to customers to finance purchases of automobiles, furniture,
appliances, electronics or other retail purchases, for the purpose of providing
products or services competitive with the Business.

3.5 Covenant Not to Hire or Solicit Employees. Employee agrees that during his
employment with the Corporation, and for a period of two (2) years immediately
following the termination thereof, whether voluntary or involuntary, he shall
not, directly or indirectly, on behalf of himself or any other person or entity,
hire or solicit any Corporation Employee for the purpose of offering employment
with any person or entity that provides installment, automobile purchase or
retail purchase loans to consumers that are competitive with those provided by
the Corporation or its Subsidiaries. “Corporation Employee,” as used in this
Agreement, shall mean any employee who is employed with the Corporation or any
of its Subsidiaries at any time during the last six (6) months of Employee’s
employment with the Corporation and with whom Employee had contact with at any
time during the last year of Employee’s employment with the Corporation.

3.6 Reasonableness of Restrictions.

(a) Employee has carefully read and considered the provisions of Sections 3.2,
3.3, 3.4 and 3.5 and, having done so, agrees that the restrictions, set forth in
these Sections, including,

 

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but not limited to, the time period of restriction and the geographical area
restriction, are fair and reasonable and are reasonably required for the
protection of the interests of the Corporation and its officers, directors,
shareholders and other employees.

(b) In the event that, notwithstanding the foregoing, either Section 3.2, or
3.3, or 3.4 or 3.5 shall be held to be invalid or unenforceable, the remaining
paragraph(s) thereof shall nevertheless continue to be valid and enforceable as
though the invalid or unenforceable paragraph(s) had not been included therein.

(c) In the event that any provision of Sections 3.2, or 3.3, or 3.4 or 3.5 shall
be held to be invalid or unenforceable, the remaining provisions thereof shall
nevertheless continue to be valid and enforceable as though the invalid or
unenforceable provision(s) had not been included therein.

(d) In the event that any provision of Sections 3.2 or 3.3 or 3.4 or 3.5
relating to the time period of restriction, the geographic area restriction
and/or related aspects is found by a court of competent jurisdiction to exceed
the maximum restrictiveness such court deems reasonable and enforceable, then it
is the express desire and intent of both the Corporation and Employee that such
provision not be rendered invalid thereby, but rather that the duration,
geographic area, scope, or nature of the restriction be deemed reduced or
modified to the extent necessary to render such provision reasonable, valid and
enforceable. The time period restriction, geographic area restriction and/or
related aspects deemed reasonable and enforceable by the court shall then
become, and thereafter be, the maximum restriction in such regard, and the
provision, as reformed, shall remain valid and enforceable. The Corporation and
Employee acknowledge that this Section 3.6(d) is contractual in nature and
expressly grant a court of competent jurisdiction the authority to effectuate
this contractual provision.

3.7 Non-Disparagement. During the term of the Employee’s employment, and
thereafter, the Employee shall not make any disparaging remarks, or any remarks
that could reasonably be construed as disparaging, regarding the Corporation,
its Subsidiaries, or its or their officers, directors, employees, stockholders,
representatives or agents. The Corporation shall cause the following individuals
to refrain from making any disparaging statements, orally or in writing,
regarding Employee from and after the termination of the Employment Period: the
Corporation’s executive officers and the members of the Board.

3.8 Use of Name. Employee will not have the rights to and may not use the name
“Regional Management Corp.” or any other name used by the Corporation or its
Subsidiaries or any derivative or abbreviation thereof in any manner, including
but not limited to in any activity prohibited under Sections 3.3, 3.4 or 3.5, or
in any manner that could reasonably be expected to be adverse to the interests
of the Corporation or its Subsidiaries. This covenant shall survive indefinitely
without limitation to time.

3.9 Breach of Restrictive Covenants. Employee acknowledges that this Agreement
is designed and intended only to protect the legitimate business interests of
the Corporation and that the restrictions imposed by this Agreement are
necessary, fair and reasonably designed to protect those interests. Employee
further acknowledges that the Corporation has given him access to certain
Confidential Information, and that the use of such Confidential Information by
him on behalf of some other entity (including himself) would cause irreparable
harm to the Corporation. Employee also acknowledges that the Corporation has
invested considerable time and resources in developing its relationships with
its Loan Sources and customers and in training Corporation Employees, the loss
of which similarly would cause irreparable harm to the Corporation.

 

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Without limitation, Employee agrees that if he should breach or threaten to
breach any of the restrictive covenants contained in Sections 3.2, 3.3, 3.4, 3.5
and 3.7 of this Agreement, the Corporation may, in addition to seeking other
available remedies, apply, consistent with Section 4.6 below, for the immediate
entry of an injunction restraining any actual or threatened breaches or
violations of said provisions or terms by Employee.

If, for any reason, any of the restrictive covenants or related provisions
contained in Sections 3.2, 3.3, 3.4, 3.5 or 3.7 of this Agreement should be held
invalid or otherwise unenforceable, it is agreed the court shall construe the
pertinent Section(s) or provision(s) so as to allow its enforcement to the
maximum extent permitted by applicable law. Employee further agrees that any
claimed Corporation breach of this Agreement shall not prevent, or otherwise be
a defense against, the enforcement of any restrictive covenant or other Employee
obligation herein.

3.10 Employee Representations. Employee represents that the restrictions on his
business provided in this Agreement are fair and protect the legitimate business
interests of the Corporation. Employee represents further that the consideration
for this Agreement is fair and adequate, and that even if the restrictions in
this Agreement are applied to him, he shall still be able to earn a good and
reasonable living from those activities, areas and opportunities not restricted
by this Agreement. Employee represents further he has had an opportunity to
consult with independent counsel concerning this Agreement and is not relying on
the Corporation or its counsel for any related legal, tax or other advice.

3.11 No Prior Obligations. Employee represents he is not subject to any
contractual or other obligation that precludes him from entering into this
Agreement or would in any way restrict his work activities as required under
this Agreement. Employee represents further he does not possess any prior
employer or other third-party proprietary information and shall not use or
disclose any such information in his work for the Corporation. In the event that
said representations should be untrue to any material extent and a related
third-party action should be initiated against the Corporation, Employee agrees
to indemnify the Corporation for any resulting liability and incurred costs,
including attorneys’ fees, in full.

3.12 Survival. The provisions contained in this Article III and in Section 4.6
will survive termination of this Agreement regardless of whether such
termination is initiated by the Corporation or the Employee.

IV. MISCELLANEOUS

4.1 Notices. All notices and other communications required or permitted
hereunder will be in writing and, unless otherwise provided in this Agreement,
will be deemed to have been duly given when delivered in person or by a
nationally recognized overnight courier service or when dispatched if during
normal business hours by electronic facsimile transfer (confirmed in writing by
mail simultaneously dispatched) to the appropriate party at the address
specified below:

 

  (a) If to the Corporation, to:

Regional Management Corp.

509 West Butler Road

Greenville, SC 29607

P.O. Box 776

Mauldin, SC 29662

Facsimile No.: (864) 422-8035

Attention: Brian J. Fisher, Vice President and General Counsel

 

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With a copy to:

Womble Carlyle Sandridge & Rice, LLP

550 South Main Street, Suite 400

Greenville, SC 29601

Facsimile No.: (864) 255-5870

Attention: Betty Temple

 

  (b) If to Employee, to:

Regional Management Corp.

509 West Butler Road

Greenville, SC 29607

P.O. Box 776

Mauldin, SC 29662

Facsimile No.: (864) 422-8035

Attention: Michael R. Dunn

or to such other address or addresses as any such party may from time to time
designate as to itself by like notice.

4.2 Amendments and Waivers.

(a) Any provision of this Agreement may be amended or waived if, but only if,
such amendment or waiver is in writing and is signed, in the case of an
amendment, by each party to this Agreement, or in the case of a waiver, by the
party against whom the waiver is to be effective.

(b) No failure or delay by any party in exercising any right, power or privilege
hereunder will operate as a waiver thereof nor will any single or partial
exercise thereof preclude any other or further exercise thereof or the exercise
of any other right, power or privilege. The rights and remedies herein provided
will be cumulative and not exclusive of any rights or remedies provided by law.

4.3 Expenses. Unless expressly set forth to the contrary elsewhere in this
Agreement, the parties will pay all of their respective expenses incurred in
connection with any legal proceeding concerning a dispute arising out of this
Agreement. Notwithstanding the foregoing, the Corporation shall pay the
reasonable fees and expenses of Employee’s attorney not to exceed $7,500 in
connection with the negotiation of this Agreement.

4.4 Successors and Assigns. The provisions, obligations and rights of this
Agreement will be binding upon and inure to the benefit of the parties hereto
and their respective successors, assigns, heirs and administrators; provided
that Employee may not assign, delegate or otherwise transfer any of his rights
or obligations under this Agreement without the prior written consent of the
Corporation.

4.5 No Third Party Beneficiaries. Except as otherwise expressly provided for
herein, this Agreement is for the sole benefit of the parties hereto and their
permitted assigns and nothing herein expressed or implied will give or be
construed to give to any Person, other than the parties hereto and such
permitted assigns, any legal or equitable rights hereunder.

 

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4.6 Choice of Law; Forum Selection; Jury Trial Waiver. This Agreement, including
its interpretation, performance, breach or any related employment or statutory
claim, shall be governed by, and construed in accordance with, the laws of the
State of Delaware without giving any force or effect to the provisions of any
conflict of law rule thereof. The parties knowingly and voluntarily agree that
any controversy or dispute arising out of or otherwise related to this
Agreement, including any employment or statutory claim, shall be tried
exclusively, without jury, and consent to personal jurisdiction, in the state
courts of Greenville, South Carolina or the United States District Court for the
District of South Carolina, Greenville division, as appropriate.

4.7 No Limitation of Rights. Nothing in this Agreement shall limit or prejudice
any rights of the Corporation under any other laws.

4.8 Counterparts. This Agreement may be signed in any number of counterparts,
including via facsimile transmission, each of which will be an original, with
the same effect as if the signatures thereto and hereto were upon the same
instrument.

4.9 Headings. The headings in this Agreement are for convenience of reference
only and will not control or affect the meaning or construction of any
provisions hereof.

4.10 Severability. If any provision of this Agreement or the application of any
such provision to any Person or circumstance is held invalid, illegal or
unenforceable in any respect by a court of competent jurisdiction, such
invalidity, illegality or unenforceability will not affect any other provision
hereof. If any provision of this Agreement is finally judicially determined to
be invalid, ineffective or unenforceable, the determination will apply only in
the jurisdiction in which such final adjudication is made, and such provision
will be deemed severed from this Agreement for purposes of such jurisdiction
only, but every other provision of this Agreement will remain in full force and
effect, and there will be substituted for any such provision held invalid,
ineffective or unenforceable, a provision of similar import reflecting the
original intent of the parties to the extent permitted under applicable law.

4.11 Certain Interpretive Matters.

(a) Unless the context otherwise requires, (i) all references to sections are to
sections of this Agreement, (ii) each term defined in this Agreement has the
meaning assigned to it, (iii) words in the singular include the plural and vice
versa, and (iv) the terms “herein,” “hereof,” “hereby,” “hereunder” and words of
similar import shall mean references to this Agreement as a whole and not to any
individual section or portion hereof. All references to $ or dollar amounts will
be to lawful currency of the United States.

(b) No provision of this Agreement will be interpreted in favor of, or against,
any of the parties hereto by reason of the extent to which any such party or his
or its counsel participated in the drafting thereof or by reason of the extent
to which any such provision is inconsistent with any prior draft hereof or
thereof.

4.12 Entire Agreement. This Agreement constitutes the entire agreement among the
parties with respect to the subject matter hereof and supersedes all prior
agreements and understandings, both oral and written, including but not limited
to any term sheet or other similar summary of proposed terms, between the
parties with respect to the subject matter of this Agreement.

4.13 Full Understanding. Employee represents and agrees that Employee fully
understands Employee’s right to discuss all aspects of this Agreement with
Employee’s private attorney, and that to the extent, if any, that Employee
desired, Employee utilized this right, Employee further

 

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represents and agrees that: (i) Employee has carefully read and fully
understands all of the provisions of this Agreement; (ii) Employee is competent
to execute this Agreement; (iii) Employee’s agreement to execute this Agreement
has not been obtained by any duress and Employee freely and voluntarily enters
into it; (iv) Employee is not subject to any covenants, agreements or
restrictions arising out of Employee’s prior employment (other than with the
Corporation) that would be breached or violated by Employee’s execution of this
Agreement or performance of duties hereunder; and (v) Employee has read this
document in its entirety and fully understands the meaning, intent and
consequences of this document. Employee agrees and acknowledges that the
obligations owed to Employee under this Agreement are solely the obligations of
the Corporation and that none of the Corporation’s stockholders, directors or
lenders will have any obligation or liabilities in respect of this Agreement and
the subject matter hereof.

4.14 Code Section 409A. Notwithstanding any other provision in this Agreement to
the contrary, if and to the extent that Code Section 409A is deemed to apply to
any benefit under this Agreement, it is the general intention of the Corporation
that such benefits shall, to the extent practicable, comply with, or be exempt
from, Code Section 409A, and this Agreement shall, to the extent practicable, be
construed in accordance therewith. Deferrals of benefits distributable pursuant
to this Agreement that are otherwise exempt from Code Section 409A in a manner
that would cause Code Section 409A to apply shall not be permitted unless such
deferrals are in compliance with or otherwise exempt from Code Section 409A. In
the event that the Corporation (or a successor thereto) has any stock which is
publicly traded on an established securities market or otherwise and the
Employee is determined to be a “specified employee” (as defined under Code
Section 409A), any payment of deferred compensation subject to Code Section 409A
to be made to the Employee upon a separation from service may not be made before
the date that is six months after the Employee’s separation from service (or
death, if earlier). To the extent that the Employee becomes subject to the
six-month delay rule, all payments of deferred compensation subject to Code
Section 409A that would have been made to the Employee during the six months
following his separation from service, if any, will be accumulated and paid to
the Employee during the seventh month following his separation from service, and
any remaining payments due will be made in their ordinary course as described in
this Agreement. For the purposes herein, the phrase “termination of employment”
or similar phrases will be interpreted in accordance with the term “separation
from service” as defined under Code Section 409A if and to the extent required
under Code Section 409A. Whenever payments under the Agreement are to be made in
installments, each such installment shall be deemed to be a separate payment for
purposes of Code Section 409A. Further, (i) in the event that Code Section 409A
requires that any special terms, provisions or conditions be included in this
Agreement, then such terms, provisions and conditions shall, to the extent
practicable, be deemed to be made a part of this Agreement, and (ii) terms used
in this Agreement shall be construed in accordance with Code Section 409A if and
to the extent required. Further, in the event that this Agreement or any benefit
thereunder shall be deemed not to comply with Code Section 409A, then neither
the Corporation, the Board, the Compensation Committee nor its or their
designees or agents shall be liable to Employee or other person for actions,
decisions or determinations made in good faith.

4.15 Compliance with Recoupment, Ownership and Other Policies or Agreements. As
a condition to entering into this Agreement, the Employee agrees that he shall
abide by all provisions of any equity retention policy, compensation recovery
policy, stock ownership guidelines and/or other similar policies maintained by
the Corporation, each as in effect from time to time and to the extent
applicable to the Employee from time to time. In addition, the Employee shall be
subject to such compensation recovery, recoupment, forfeiture or other similar
provisions as may apply at any time to the Employee under applicable law.

4.16 Waiver and Release. The Employee acknowledges and agrees that the
Corporation may at any time require, as a condition to receipt of benefits
payable under this Agreement,

 

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including but not limited to the payment of termination benefits pursuant to
Sections 2.4(b), 2.7(a), 2.7(d), 2.7(e), 2.7(f) and 2.7(g) herein, that the
Employee (or a representative of his Estate) execute a waiver and release
discharging the Corporation and its Subsidiaries, and their respective
Affiliates, and its and their officers, directors, managers, employees, agents
and representatives and the heirs, predecessors, successors and assigns of all
of the foregoing, from any and all claims, actions, causes of action or other
liability, whether known or unknown, contingent or fixed, arising out of or in
any way related to the Employee’s employment, or the ending of the Employee’s
employment with the Corporation or the benefits thereunder, including, without
limitation, any claims under this Agreement or other related instruments. The
waiver and release shall be in a form determined by the Corporation and shall be
executed prior to the expiration of the time period provided for payment of such
benefits (including those provided under Section 2.4(b) and/or Section 2.7
herein).

4.17 Tax Matters. The Corporation has made no warranties or representations to
the Employee with respect to the tax consequences (including but not limited to
income tax consequences) contemplated by this Agreement and/or any benefits to
be provided pursuant thereto. The Employee acknowledges that there may be
adverse tax consequences related to the transactions contemplated hereby and
that the Employee should consult with his own attorney, accountant and/or tax
advisor regarding the decision to enter into this Agreement and the consequences
thereof. The Employee also acknowledges that the Corporation has no
responsibility to take or refrain from taking any actions in order to achieve a
certain tax result for the Employee.

[Remainder of Page Intentionally Left Blank]

 

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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly
executed as of the day and year first above written.

 

REGIONAL MANAGEMENT CORP. By:  

/s/ Carlos Palomares

Name:   Carlos Palomares Title:   Chairman of the Compensation Committee of the
Board of Directors

 

EMPLOYEE

/s/ Michael R. Dunn

Michael R. Dunn

 

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