Filed by Bowne Pure Compliance



 




EXHIBIT 10.1


CORUS BANK, N.A.

Commercial Loan Officer Compensation Programs


Amendment of Existing
Commission Program and Announcement of 
 New Commission Program
for Commercial Loan Officers


Effective for this calendar year,
the company has decided to terminate the existing compensation program for
commercial loan officers and institute a new program. This change is the
company’s response to the American Jobs Creation Act (aka 409-A). That
legislation has turned the maintenance of our existing program, which involves
a long-term holdback account for participating officers, into an
extremely complicated compliance burden.


The new program will be less
lucrative for officers than the old program, but will not involve a long-term
holdback account. It will be far easier for the company to maintain records for
this new program and to comply with all relevant laws and regulations. Officers
will still have a material amount of their current year’s compensation at
risk if their loans incur losses. In the case of highly compensated officers,
the amount of their current year’s compensation at risk should be well
above 50%, so we believe officers and the company will continue to have strong
alignment of interests.


The Old Program


As for loans originated prior to
11/1/06, the old program will run its course subject to the existing program
guidelines, as they might be amended from time to time. Amendments will
hopefully be very few in number, though we are making several changes this year
in conjunction with phasing the program out.


As for how phasing out the old
program will work, loans originated through 10/31/06 will continue to generate
cash commissions and holdback amounts based on existing formulas. The existing
holdback amounts will be released or eliminated based on the performance of
those loans, and those loans only.


In general, the old program will
play itself out without regard to the new compensation program described below.
However, the Bank will include compensation generated by the new program when
it makes certain calculations necessary for the old program.


Any holdback and any cash
compensation earned by officers pursuant to the old program is at risk of loss
if an officer incurs a loss on a loan in the old program, but losses in excess
of any such holdbacks and cash compensation under the old program will not put
at risk compensation derived from the new program described below. Similarly,
losses on loans in the new program will not affect the release of or reduce
holdbacks under the old program.


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We anticipate that it might take as
long as five years or more for the loans originated prior to 10/31/06 to pay
off or otherwise be disposed of. Officers who have all
their loans pay in full will receive their full holdback amount in the manner
set forth in the program guidelines. For officers who incur losses, those
losses might not be quantifiable for some years, and they might well find much
or all of their holdback tied up and at risk of forfeiture for several years.
The amounts of any forfeitures are purely speculative at this point.


The New Program


The new program is effective this
year (that is, retroactively to loans originated from 11/1/06 and onward).
Amounts paid pursuant to this new program will be in addition to any amounts
paid pursuant to the old program. Records for the two programs will be kept
independently of one another.


This new program will be far simpler
than the prior program. No holdback. No servicing fee. No limits on loan size.
No inflection point. No long and complicated document that articulates the
Program Guidelines. This memo suffices to describe the plan in full, as
compared to the 15 page document that
governed the old plan.


The new program will work as follows:


Profits will be defined as all loan
fees, interest income, servicing fees and prepayment charges actually collected
(or capitalized on the Bank’s books), minus a cost of funds (equal to the
90-day Treasury bill yield plus 1.50%) and minus any unreimbursed loan costs.
This top-line calculation will require that we maintain a database very similar
to the one that supported the old program.


The officers involved in a given
loan (excluding the member of the Directors Loan Committee assigned to the
transaction as a Supervising Officer) will receive as a year-end bonus 6% of
Profits paid by borrowers in that year (subject to the exercise of negative
discretion by the Committee, as described below). When multiple officers are
involved in a deal they will negotiate a split among themselves, subject to
Bank approval. One Executive Officer, Tim Stodder, participates in this program
as a Supervising Officer for certain loans. For any loans in which
Mr. Stodder acts as Supervising Officer, he will receive as a year-end
bonus 2% of Profits paid by the borrower with respect to such loan in that
year, with such payment being in addition to the 6% paid to other officers
involved in the transaction. Any reference to 6% of profits or losses in this
document will in Mr. Stodder’s case be 2%.


We will assume that all loans
involve the efforts of at least two officers, and the junior officer will be
entitled to at least 10% of the bonus associated with that loan. In order to
encourage teamwork and fully utilize our junior officer pool, if an officer
elects to work on a loan without a supporting officer, then the company will
retain 10% of the bonus.


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All officers will need to cover 100%
of their base salary before earning bonuses, with credit given for base salary
that was already covered by the old program.


The new system will involve loss
sharing. Six percent (2% in Mr. Stodder’s case) of any principal
charged off by the Bank in a given year will be charged in a pro-rata manner to
the officers who received a bonus for the loan in question. To simplify things,
we are ignoring carrying costs, opportunity costs and recoveries. However, if
the Bank finds itself in a situation where principal charge-offs were small or
non-existent, but the Bank still incurred substantial out-of-pocket carrying
costs, the Bank reserves the right to consider such costs and pass them on to
the officers involved on a discretionary basis (see below).


Losses attributed to officers on a
given charge off event will be capped at the loss of the current year’s
bonus. That is, charge-offs from one year will not put future years’
bonuses at risk. If one loan has a charge off in one year, and then another
charge off in a subsequent year (or even a third year), the officer will be
assessed his or her share of the loss each time a charge off occurs.


We will retain the
October 31 year-end for the purpose of calculating bonuses and
losses, but the compensation is still associated with calendar years. Payment
of any bonuses for a given calendar year will be made by December 31 of
that year. Individuals whose employment has been terminated on or prior to the
payment date will not be entitled to payment. No payments will be made under
this program to former employees.


Negative Discretion. Although
the program outlined above is intended to work in a formulaic manner (i.e.,
bonuses are calculated in accordance with the formula described above, rather
than on a discretionary basis), the company nevertheless has the discretionary
authority to reduce the bonus to which an officer would otherwise be entitled
under the program. It is management’s desire to avoid discretionary adjustments,
and we were able to maintain the old program for many officers for many years with hardly
any discretionary adjustments. We hope that will be true of the new program as well.


Authority to Amend or Terminate.
The company reserves the right to amend or terminate the program at any
time.


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