Document:

Exhibit 10.8

 

AMENDMENT TO

INCENTIVE DEFERRED BONUS COMPENSATION AGREEMENT

BETWEEN WALKER & DUNLOP GP, LLC AND

WILLIAM WALKER

 

WHEREAS,
Walker & Dunlop GP, LLC (the “Company”) and William Walker (the “Employee”)
previously entered into an Incentive Deferred Bonus Compensation Agreement (the
“Agreement”) originally effective as of June 16, 2008; and

 

WHEREAS,
Section 4.8(B) of the Agreement provides that the Agreement may be
amended at any time by written consent of the Company and the Employee; and

 

WHEREAS,
the Company and the Employee now wish to amend the Agreement, effective as of January 1,
2009, in order to ensure compliance with the requirements of section 409A of
the Internal Revenue Code of 1986, as amended, and to make certain other
changes to the terms of payment as permitted by applicable transitional
guidance.

 

NOW,
THEREFORE, the Company and the Employee agree to amend the Agreement, effective
as of January 1, 2009, as follows:

 

Section 3.2
is amended by deleting subsection 3.2(A)(ii) in its entirety and inserting
the following in lieu thereof:

 

(ii)           If Employee’s rights to a Deferred
Bonus for a Base Fiscal Year vest pursuant to Section 3.1(D), the portion
of the Deferred Bonus attributable to each respective Base Fiscal Year shall be
paid to Employee (or, if applicable, his Beneficiary) within sixty (60) days
after the third anniversary of the first day of that Base Fiscal Year.  For example, if the Employee has earned a
Deferred Bonus for the 2008 and 2009 Base Fiscal Years and a Change in Control
occurs on December 31, 2009, (a) the Employee’s rights to the
Deferred Bonus shall become fully earned and vested as of December 31,
2009; (b) the portion of the Deferred Bonus attributable to the 2008 Base
Fiscal Year shall be paid to the Employee (or, if applicable, his Beneficiary)
within 60 days after January 1, 2011, without regard to whether or not the
Employee remains employed with the Company (or any successor entity) on that
date; and (c) the portion of the Deferred Bonus attributable to the 2009
Base Fiscal Year shall be paid to the Employee (or, if applicable, his
Beneficiary) within 60 days after January 1, 2012, without regard to
whether or not the Employee remains employed with the Company (or any successor
entity) on that date.

 

1

 

IN
WITNESS WHEREOF, the parties have executed this Amendment as of the 31
day of December, 2008.

 

	
   

  	
  WALKER &
  DUNLOP GP, LLC

  
	
   

  	
  By:

  	
  /s/ Deborah A. Wilson

  
	
   

  	
  Name:

  	
  Deborah
  A. Wilson

  
	
   

  	
  Title:

  	
  SVP &
  CFO

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  /s/ William Walker

  
	
   

  	
  William
  Walker

  

 

2Exhibit
10.9

 

	
  Smith,
  H.

  	
  2008

  

 

INCENTIVE DEFERRED BONUS COMPENSATION AGREEMENT

 

THIS
AGREEMENT (“Agreement”), made as of the 16th day of June,
2008, by and between Walker & Dunlop GP, LLC (“Employer”) and Howard
W. Smith III (“Employee”).

 

WITNESSETH
THAT:

 

WHEREAS,
Employer has a substantial investment and ownership interest in Green Park
Financial Limited Partnership (“Green Park”) which acts as an approved Fannie
Mae multifamily lender under the DUS program; and

 

WHEREAS,
Employee is serving as Employer’s Executive Vice President & COO and,
in that capacity has senior management responsibility for Green Park’s
operations and an important role in Green Park’s success; and

 

WHEREAS,
in order to maximize the returns it derives from its substantial investment and
ownership in Green Park, Employer desires to provide Employee with an incentive
to contribute to the growth of the business and profitability of Green Park
and, to that end, the parties desire to enter into this Agreement.

 

NOW,
THEREFORE, in consideration of the foregoing and of the mutual promises
hereinafter set forth and of other good and valuable consideration, the
sufficiency and receipt of which prior to the execution of these presents is
hereby acknowledged, the parties hereto, intending to be legally bound, do
hereby agree as follows:

 

1

 

ARTICLE I

 

Definitions

 

Section 1.1
Definitions.

 

When
used in this Agreement, the following terms will have the meanings set forth
below:

 

(A)          “Base Fiscal Year” means the Fiscal
Year to which a Deferred Bonus relates (e.g., Fiscal Year 2008 shall be the
Base Fiscal Year for any Deferred Bonus potentially payable to Employee for
Fiscal Year 2008).

 

(B)            “Beneficiary” means
one or more individuals designated by Employee to receive benefits payable
hereunder upon Employee’s death (whether voluntary or involuntary). Employee
shall designate his Beneficiary in writing on a form provided by Employer.
Employee may change his designated Beneficiary by filing a new form with
Employer (at least ten (10) business days prior to the effective date of
such change). If no Beneficiary designated by Employee survives Employee, or if
Employee fails to designate a Beneficiary, any payments due hereunder upon
Employee’s death shall be paid to Employee’s executor or other legal
representative.

 

(C)           “Change in Control”
shall mean the occurrence of any one or more of the following without Employee’s
prior consent (which consent can be conditioned or withheld, with or without
cause, in Employee’s sole discretion): (i) the sale or other disposition
of all, or substantially all, of the assets of Green Park or Employer; or (ii) the
sale or other transfer within any period of twelve (12) consecutive calendar
months (either in one transaction or in a series of transactions within such
twelve (12) month period) of partnership interests (or stock or other forms of
ownership interests, as the case may be) representing 

 

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more than fifty percent (50%) of all
partnership interests (or all stock or all other forms of ownership interests)
in either Green Park or Employer; but not if stock is transferred to a family
trust or other entity designed principally to facilitate estate planning.

 

(D)          “Deferred Bonus”
means the amount of the deferred bonus potentially payable to Employee on
account of a particular Base Fiscal Year in accordance with the provisions
hereof.

 

(E)           (i)            “Deferred Bonus Earn-Out Period”
means, with respect to each Deferred Bonus for each Base Fiscal Year, the
period beginning on the first day of the Base Fiscal Year and terminating on
various dates as determined in accordance with the following provisions:

 

(a)           If Employee remains
continuously in Employer’s employ for a period of three (3) years
commencing with the first day of a Base Fiscal Year, or if Employee’s
employment with Employer terminates as a result of Employee’s Intentional Death
or Disability occurring within a three (3) year period commencing on the
first day of a Base Fiscal Year, the last day of the Deferred Bonus Earn-Out
Period applicable to that Base Fiscal Year shall be the last day of the three (3) year
period commencing with the first day of the Base Fiscal Year;

 

(b)          If
Employee’s employment with Employer terminates as a result of Employee’s
Unintentional Death or Disability occurring within a three (3) year period
commencing on the first day of a Base Fiscal Year, the last day of the Deferred
Bonus Earn-Out Period applicable to that Base Fiscal Year shall be the date on
which Employee’s Unintentional Death or Disability occurs;

 

(c)          If
Employee’s employment with Employer terminates as a result of a Termination
Without Cause occurring within a three (3) year period commencing on the
first day of a Base Fiscal Year, the last day of the Deferred Bonus Earn-

 

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Out Period applicable to that Base Fiscal
Year shall be the date on which the Termination Without Cause occurs;

 

(d)          If
Employee’s employment with Employer terminates as a result of a Change in
Control occurring within a three (3) year period commencing on the first
day of a Base Fiscal Year, the last day of the Deferred Bonus Earn-Out Period
applicable to that Base Fiscal Year shall be the date on which the Change in Control
occurs; and

 

(e)          If
a Deferred Bonus Earn-Out Period terminates upon the occurrence of an event
(such as, by way of example, a Termination Without Cause of Employee’s
employment), that termination (and all consequences associated therewith under
the provisions hereof) shall not be affected by the subsequent occurrence of
another event (such as, by way of example, a Change in Control) which, but for
the prior occurrence of the first event, also would have resulted in a
termination of that Deferred Bonus Earn-Out Period.

 

(ii)             As hereinafter
appears, Employee shall not be entitled to receive a Deferred Bonus, and there
shall be no Deferred Bonus Earn-Out Period, for any particular Base Fiscal Year
if Employee’s employment with Employer terminates as a result of either a
Voluntary Resignation or a Termination With Cause which occurs within a three (3) year
period commencing on the first day of that Base Fiscal Year.

 

(F)             “Disability” means
disability as a result of an accident, illness or mental disorder which results
in Employee’s unwillingness or inability, for a period of ninety (90) days (in
the aggregate) during any period of twelve (12) consecutive months,
substantially to perform the duties assigned to Employee by Employer
immediately prior to the commencement of the Disability. For all purposes
hereof:

 

4

 

(i)            Employee’s
Disability shall be deemed to have occurred as of the last day of the foregoing
period of ninety (90) days;

 

(ii)           If Employer and Employee
disagree as to whether a Disability has occurred or as to when a period of
Disability has begun or ended, and if the disagreement cannot be resolved
within fifteen (15) business days after it has first arisen, Employer and
Employee shall each, within fifteen (15) business days after the expiration of
the first period of fifteen (15) business days, appoint a qualified physician
or other medical professional (hereinafter in this Section 1.1(F)(ii) collectively
a “Doctor”) (and if either Employer or Employee fails timely to make such an
appointment, the Doctor appointed by or for the other party shall resolve all
disagreements regarding Disability). The two Doctors (or, if applicable, the
one Doctor) shall, as promptly as possible, make a written determination as to
all disagreements with respect to the Employee’s Disability; provided, however,
that if two Doctors are timely appointed and cannot agree on all matters
respecting Employee’s Disability within a period of thirty (30) days after the
second of them has been timely appointed, the two of them shall, as promptly as
possible thereafter, appoint a third Doctor and all disagreements as to
Employee’s Disability shall be determined in writing by a majority of the three
Doctors. All good faith decisions made by one or more Doctors regarding
Employee’s Disability shall be conclusive and binding on Employer and Employee.
If such decisions are made by a single Doctor, all fees and expenses of such
Doctor shall be borne equally by Employer and Employee. Otherwise, Employer and
Employee shall each pay the fees and expenses of any Doctor appointed by or for
it or him and shall, if applicable, bear equally the fees and expenses of any
third Doctor.

 

(G)           “Employee” means
Donna Mighty and, where appropriate, shall also be deemed to mean his executor,
guardian or other legal representative.

 

5

 

(H)            “Employer” means Walker &
Dunlop GP, LLC and any successor to, or assignee of, Walker & Dunlop
GP, LLC to which Employee has consented, in Employee’s sole discretion.

 

(I)             “Fiscal Year”
means a fiscal year of Green Park (presently a calendar year).

 

(J)            “Intentional Death
or Disability” means the death or Disability of Employee which results from an
injury or illness that is intentionally self-inflicted by Employee or
intentionally inflicted upon Employee by a third Person acting, or failing to
act, under the control, or at the direction, of Employee.

 

(K)          “Person” means, as the context
requires, an individual, partnership, corporation, trust, unincorporated
association, joint stock company, or other legal entity or association.

 

(L)            “Schedules” means,
collectively, the Schedules attached, or to be attached, hereto.

 

(M)         “Termination With Cause” means the
termination by Employer of Employee’s employment with Employer on account of (i) his
conviction for the commission of a felony in the course of his employment with
Employer, or (ii) his gross, willful and intentional misconduct in
connection with his employment with Employer which causes a material decrease
in the net profits of Green Park for the Fiscal Year within which such
misconduct occurs.

 

(N)          “Termination Without Cause” means the
termination by Employer of Employee’s employment with Employer without Employee’s
consent for any reason which does not constitute Termination With Cause.

 

6

 

(0)           “Unintentional Death
or Disability” means the death or disability of Employee which results from any
reason which does not constitute Employee’s Intentional Death or Disability.

 

(P)           “Voluntary Resignation” means the
voluntary decision or election by Employee to terminate his employment with
Employer for any reason whatsoever other than a material breach by Employer of
this Agreement which is not cured within any applicable grace period specified
herein.

 

Section 1.2 Certain Other Definitions.

 

When
used herein with its initial letter(s) capitalized, a term which is not
defined in Section 1.1 shall be given the definition assigned to it
elsewhere in this Agreement.

 

Section 1.3 Schedules and Exhibits.

 

Attached
hereto and forming an integral part of this Agreement are various Schedules and
Exhibits, all of which are incorporated into this Agreement as fully as if the
contents thereof were set out in full herein at each point of reference
thereto. The provisions of the immediately preceding sentence shall also apply
to any Schedules, Exhibits or other attachments which, pursuant to the
provisions hereof, are to be prepared and attached hereto in the future.
Notwithstanding any other provision hereof, if there is any conflict or
inconsistency between the provisions contained in this Agreement and the
provisions contained in any Schedule or Exhibit attached hereto (either
now or in the future), the provisions of the Schedule or Exhibit shall
govern and prevail.

 

7

 

ARTICLE II

 

Determination Of Deferred Bonus

 

Section 2.1
In General.

 

(A)          (i)            As
a general matter (unless otherwise agreed by Employer and Employee), Employee’s
Deferred Bonus for each Base Fiscal Year commencing after the date hereof shall
depend on two factors, namely, the achievement of a base financial target (the “Base
Financial Target”) during each such Base Fiscal Year and the achievement of an
annualized financial target (the “Annualized Financial Target”) during the
Deferred Bonus Earn-Out Period applicable to such Base Fiscal Year. Commencing
sixty (60) days prior to the commencement of each Base Fiscal Year commencing
after the date hereof, Employer and Employee shall negotiate in good faith
regarding the Base Financial Target for such Base Fiscal Year as well as the
Annualized Financial Target for the Deferred Bonus Earn-Out Period (the
foregoing Base Financial Target and Annualized Financial Target being
hereinafter collectively referred to as “Targets”). If Employer and Employee
agree upon the Targets for a Base Fiscal Year commencing after the date hereof,
the Targets for that Base Fiscal Year shall be incorporated in a Schedule which
shall be attached hereto and shall become a part hereof. If, despite good faith
negotiations, Employer and Employee are unable to agree on the Targets for a
Base Fiscal Year commencing after the date hereof prior to the first day of
such Base Fiscal Year, the last set of Targets agreed upon (as set out in the
last Schedule attached hereto) shall be deemed to be the Targets for that Base
Fiscal Year; provided, however, that the foregoing provisions of this sentence
shall not be deemed or construed to preclude Employer and Employee from
continuing to negotiate (or to agree) regarding the Targets for a particular
Base Fiscal Year after the commencement of such Base Fiscal Year if the parties
agree to such continued negotiations (or agreement).

 

8

 

(ii)           Notwithstanding the
provisions of Section 2.1(A)(i):

 

(a)           If Employee’s
employment with Employer terminates (for any reason other than a Voluntary
Resignation or a Termination With Cause) during (and not after) a particular
Base Fiscal Year, the Base Fiscal Target for that Base Fiscal Year shall be
pro-rated by multiplying such Target by a fraction, the numerator of which
shall be the number of months (rounded to the nearest whole number) Employee
was employed by Employer during such Base Fiscal Year and the denominator of
which shall be twelve (12). The pro-rated Base Fiscal Target shall then be
compared with Employer’s actual financial performance (or with the other
relevant actual financial data) during the portion of the Base Fiscal Year that
Employee was employed by Employer in determining whether the pro-rated Base
Financial Target was met during such portion of such Base Fiscal Year. In such
event, if the pro-rated amount of the Base Financial Target does not exceed
Employer’s actual financial performance (or the other relevant actual financial
data) during the period of Employee’s employment during the Base Fiscal Year,
Employee shall not be entitled to a Deferred Bonus for such Base Fiscal Year.
If the pro-rated amount of the Base Financial Target does exceed Employer’s
actual financial performance (or the other relevant actual financial data)
during such period, Employee’s Deferred Bonus shall (subject to all vesting and
other applicable provisions hereof) be based on the amount of such excess and
shall not be adjusted as a result of Employer’s actual financial performance
(or the other relevant actual financial data) during the remainder of such Base
Fiscal Year. In the circumstances described in the first sentence of this Section 2.1(A)(ii),
the period within which Employer shall determine whether the Base Financial
Target has been met (as provided in Section 2.1(B) hereof) shall
commence as of the date of the termination of Employee’s employment and the
other provisions of this Agreement shall otherwise continue to apply. Without
in any way limiting the generality of the foregoing, the termination of
Employee’s employment as a

 

9

 

result of Intentional Death or Disability
during the Base Fiscal Year shall not accelerate or otherwise modify the
Deferred Bonus Earn-Out Period applicable to such Base Fiscal Year. Where
necessary or appropriate, references in this Agreement to the Base Financial
Target shall be deemed to be references to the pro-rated Base Financial Target
provided for in this Section 2.1(A)(ii)(a); and

 

(b)           If the last day of a
Deferred Bonus Earn-Out Period occurs during, rather than after, the Base
Fiscal Year (if, for example, Employee is the subject of a Termination Without
Cause during the Base Fiscal Year), any Annualized Financial Target for the
Deferred Bonus Earn-Out Period for such Base Fiscal Year will be pro-rated by
multiplying such Target by a fraction, the numerator of which shall be the
number of months (rounded to the nearest whole number) Employee was employed by
Employer during such Base Fiscal Year and the denominator of which shall be
twelve (12). The pro-rated Annualized Fiscal Target shall then be compared with
Employer’s actual financial performance (or with the other relevant actual
financial data) during the portion of the Base Fiscal Year that Employee was
employed by Employer in determining whether the pro-rated Annualized Financial
Target was met. Where necessary or appropriate, references in this Agreement to
the Annualized Financial Target shall be deemed to be references to the
pro-rated Annualized Financial Target provided for in this Section 2.1(A)(ii)(b).

 

(B)            As soon as may be
practicable, and in any event within sixty (60) days, after the expiration of
each Base Fiscal Year, Employer shall determine whether the Base Financial
Target was met during such Base Fiscal Year and, if so, the amount of the
Deferred Bonus that Employee may receive with respect to such Base Fiscal Year
(provided that any applicable Annualized Financial Target, as well as all other
applicable vesting requirements, are met during the Deferred Bonus Earn-Out
Period applicable to such Base Fiscal Year). Employer shall promptly advise
Employee as to whether the Base Financial Target has been 

 

10

 

met during the Base Fiscal Year in question
and, if so, the amount of the Deferred Bonus for that Base Fiscal Year as
computed by Employer. Employee shall be entitled to review all financial and
other records relevant to Employer’s determinations with respect to the
achievement of the Base Financial Target, the amount of Employee’s Deferred
Bonus, if any, and all related computations. Employer shall give careful and
good faith consideration to any bona fide questions raised by Employee
regarding Employer’s foregoing determinations and shall make any adjustments
therein as Employer deems necessary or appropriate in the light of such
questions. Employer’s good faith determination as to the amount of Employee’s
Deferred Bonus (either as originally computed or as adjusted) shall, however,
be binding and conclusive on Employer and Employee unless the amount in
question or controversy as to the size of the Deferred Bonus exceeds $25,000
(in which event such question or controversy shall be referred to, and
determined by, arbitration in accordance with Section 4.3 hereof). Once
the final amount of Employee’s Deferred Bonus for any Base Fiscal Year has been
computed, agreed or determined, such amount shall be memorialized in an
addendum which shall also be attached hereto and shall be deemed a part hereof
and such amount shall not then thereafter change.

 

(C)           Notwithstanding the foregoing provisions of Sections 2.1 (A) and
(B), it is acknowledged and agreed that Green Park has agreed to pay, or
reimburse, Employer for any Deferred Bonus Employer pays to Employee pursuant
to this Agreement and that this Agreement is premised on the assumption that
this payment or reimbursement arrangement shall continue as between Green Park
and Employer. If Green Park should refuse to pay or reimburse Employer for any
Deferred Bonus attributable to a Base Fiscal Year that is to commence after the
date of such refusal by Green Park, Employer shall have the right, in its sole
discretion, not to pay Employee any Deferred Bonus for that Base Fiscal Year or
to agree upon Targets for that Base Fiscal Year. The provisions of the
immediately preceding

 

11

 

sentence shall not, however, apply to the
current Fiscal Year (Fiscal Year 2008) or to any subsequent Base Fiscal Year
that commences prior to the date, if any, on which Green Park refuses to pay or
reimburse Employer for Employee’s Deferred Bonus (it being expressly
acknowledged and agreed that, as between Employer and Employee, Employer shall
assume the risk of any breach by Green Park of any agreement to reimburse or
pay Employer for Employee’s Deferred Bonus as well as the risk that Green Park
shall refuse to pay or reimburse Employer for Employee’s Deferred Bonus for a
particular Base Fiscal Year after the commencement of that Base Fiscal Year).
Employer further agrees with Employee that Employer shall not, in its capacity
as a partner in Green Park, vote in favor of, or otherwise approve, any action
by Green Park to modify, terminate or cancel Green Park’s agreement to pay or
reimburse Employer for Employee’s Deferred Bonus for any subsequent Base Fiscal
Year.

 

Section 2.2
Fiscal Year 2008.

 

Employer and Employee have agreed upon the Targets for the computation
of Employee’s Deferred Bonus for Fiscal Year 2008 (which Targets are set out in
Schedule 1-2008 which is attached hereto and hereby made a part hereof).

 

12

 

ARTICLE III

 

Vesting,
Payment and Nonvesting of Deferred Bonus

 

Section 3.1
Vesting of Deferred Bonus.

 

Except as otherwise provided in Section 3.3, Employee’s Deferred
Bonus for any particular Base Fiscal Year shall become vested (i.e., shall be
deemed fully earned, and not subject to lapse), and shall be payable to or for
an Employee in accordance with Section 3.2 in accordance with the
following provisions:

 

(A)          If the last day of the Deferred Bonus
Earn-Out Period for a Deferred Bonus for a particular Base Fiscal Year is the
last day of the three (3) year period commencing with the first day of
that Base Fiscal Year (under the circumstances specified in Section 1.1(E)(i)(a)),
and if Green Park meets the Annualized Financial Target during that Deferred
Bonus Earn-Out Period, then the Deferred Bonus for that Base Fiscal Year shall
be deemed fully earned and vested as of the date on which the Deferred Bonus
Earn-Out Period terminates;

 

(B)          If the last day of the Deferred Bonus
Earn-Out Period for a Deferred Bonus for a particular Base Fiscal Year is the
day on which Employee’s Unintentional Death or Disability occurs (under the
circumstances specified in Section 1.1(E)(i)(b)), and if Green Park meets
at least Sixty-Five Percent (65%) of the Annualized Financial Target during
that Deferred Bonus Earn-Out Period, then the Deferred Bonus for that Base
Fiscal Year shall be deemed fully earned and vested as of the date on which the
Deferred Bonus Earn-Out Period terminates;

 

(C)          If the last day of the Deferred Bonus
Earn-Out Period for a Deferred Bonus for a particular Base Fiscal Year is the
date on which a Termination Without Cause of Employee’s employment occurs
(under the circumstances specified in Section 1.1(E)(i)(c)), 

 

13

 

and if Green Park meets at least Seventy-Five
Percent (75%) of the Annualized Financial Target during such Deferred Bonus
Earn-Out Period, then the Deferred Bonus for that Base Fiscal Year shall be
deemed fully earned and vested as of the date on which the Deferred Bonus
Earn-Out Period terminates; and

 

(D)          If the last day of the Deferred Bonus
Earn-Out Period for a Deferred Bonus for a particular Base Fiscal Year is the
date on which a Change in Control occurs (under the circumstances specified in Section 1.1(E)(i)(d)),
then, whether or not Green Park meets the Annualized Financial Target, or any
portion thereof, during such Deferred Bonus Earn-Out Period, the Deferred Bonus
for that Base Fiscal Year shall be deemed fully earned and vested as of the
date on which the Deferred Bonus Earn-Out Period terminates.

 

Section 3.2 Payment of Vested Deferred Bonus.

 

(A)          Employer shall pay Employee (or, if
applicable, his Beneficiary) the amount of any Deferred Bonus which vests
pursuant to the provisions of Section 3.1 in accordance with the following
provisions:

 

(i)             If Employee’s
rights to a Deferred Bonus for a Base Fiscal Year vest pursuant to Section 3.1(A),
Section 3.1(B) or Section 3.1(C), that Deferred Bonus shall,
subject to the provisions of Sections 3.2(B) and 3.2(C), be paid to
Employee (or, if applicable, his Beneficiary) within sixty (60) days after the
last day of the taxable year in which Employee’s rights to that Deferred Bonus
vest; and

 

(ii)            If Employee’s
rights to a Deferred Bonus for a Base Fiscal Year vest pursuant to Section 3.1(D),
that Deferred Bonus shall be paid to Employee within sixty (60) days after the
date on which Employee’s rights to that Deferred Bonus vest.

 

(B)           (i)            Notwithstanding the provisions of Section 3.2(A)(i),
when the vesting of Employee’s rights to a Deferred Bonus (pursuant to Section 3.1(A),
Section 3.1(B) or 

 

14

 

Section 3.1(C)) depends upon the meeting
by Green Park of all, or a specified percentage, of an Annualized Financial
Target, the payment period of sixty (60) days specified in Section 3.2(A)(i) shall
be extended if, and to the extent, necessary in order for a determination to be
made (in accordance with the provisions of Section 3.2(C)) as to whether
all, or the specified percentage, of the Annualized Financial Target has been
met; provided that payment shall be made no later than 2-1/2 months after the
last day of the taxable year in which Employee’s rights to the Deferred Bonus
vest. An extension of the period within which a vested Deferred Bonus shall be
paid shall not extend or defer the date as of which such Deferred Bonus shall
be deemed to have vested.

 

(ii)             If the last day
of a Deferred Bonus Earn-Out Period falls on a day that is other than the last
day of a fiscal quarter, Employer may, solely for the purpose of determining
whether the relevant Annualized Financial Target has, or has not, been met
during that Deferred Bonus Earn-Out Period, assume that the relevant financial
reports or data for Green Park as of the end of the fiscal quarter that is
closest in time to the last day of that Deferred Bonus Earn-Out Period is the
same as the relevant financial reports or data for Green Park as of the actual
last day of that Deferred Bonus Earn-Out Period. To illustrate: assume that the
first day of the Deferred Bonus Earn-Out Period for the fiscal Year in question
is January 1 and that, because of a Change in Control, the last day of
that Deferred Bonus Earn-Out Period is May 25. For the sake of
convenience, Employer may use the relevant financial reports or data for Green
Park as of June 30 (the end of the fiscal quarter that is closest in time
to the actual last day of the Deferred Bonus Earn-Out Period in question) as
constituting the relevant financial reports or data for Green Park as of May 25
for the purpose of determining whether the Annualized Financial Target for that
Deferred Bonus Earn-Out Period has been met. Similarly, if the last day of a
Deferred Bonus Earn-Out 

 

15

 

Period is October 10, Employer may use
the relevant financial reports or data for Green Park as of September 30
for computation purposes as aforesaid.

 

(iii)          If the period for the payment of a
vested Deferred Bonus is extended pursuant to the preceding provisions of this Section 3.2(B),
Employer shall pay interest on the amount of the Deferred Bonus at an annual
rate equal to the Prime Rate plus 1% (or, if lower, at the highest percentage
rate allowed by law) during the period such Deferred Bonus is due and unpaid;
and provided further that if Employer shall fail timely to pay Employee (or his
Beneficiary) a vested Deferred Bonus once Employee’s entitlement thereto has
been determined, Employee (or his Beneficiary) shall be entitled to receive
interest on the amount of such Deferred Bonus at an annual rate equal to the
Prime Rate plus 5% (or, if lower, the highest percentage interest rate allowed
by law) during the period such Deferred Bonus is due and unpaid. (For all purposes
hereof “Prime Rate” means the prime rate of interest published (on the date
from which the Prime Rate is to accrue) by The
Wall Street Journal as the base rate for corporate loans posted by a
number (normally expressed as a percentage) of the largest banks in the United
States of America.)

 

(C)          Whenever the payment of a Deferred
Bonus is dependent upon the meeting by Green Park of all, or a specified
percentage, of an Annualized Financial Target during a Deferred Bonus Earn-Out
Period, Employer shall, as promptly as may be practicable after the date on
which the Deferred Bonus Earn-Out Period for such Deferred Bonus terminates and
Employer has received such financial reports or data relating to Green Park
which are needed in order to determine whether all, or the specified percentage
of the Annualized Financial Target has been met, make a written determination
as to whether all, or the specified percentage, of such Annualized Financial
Target has been met and shall provide Employee with a copy of such written
determination. Employee shall have the right to review all financial and other
records relevant to such determination. Employer shall give careful and 

 

16

 

good faith consideration to any bona fide
questions raised by Employee regarding Employer’s
determination and shall, if necessary or appropriate, adjust Employer’s
determination in light of such questions. Employer’s good faith determination
(either as initially made or as thereafter adjusted) as to whether Green Park
has met all, or the specified percentage, of the Annualized Financial Target
shall, however, be binding and conclusive upon Employer and Employee unless the
amount of the Deferred Bonus in question or controversy exceeds $25,000 (in which
event all questions or controversies as to whether or not the Deferred Bonus in
question has vested shall be referred to, and determined by, arbitration
pursuant to Section 4.3 hereof).

 

Section 3.3
Nonvesting of Deferred Bonus.

 

If
(A) Employee’s employment with Employer terminates as a result of a
Termination With Cause or a Voluntary Resignation at any time during the three (3) year
period commencing with the first day of a Base Fiscal Year, or if (B) the
Base Financial Target is not met during the Base Fiscal Year, or if (C) vesting
of a particular Deferred Bonus is dependent upon the meeting by Green Park of
all, or a specified percentage, of an Annualized Financial Target during the
Deferred Bonus Earn-Out Period applicable to such Deferred Bonus and Green Park
fails to meet such Annualized Financial Target (or the specified percentage
thereof), then, in each of such events, the Deferred Bonus for such Base Fiscal
Year shall not vest or become earned and all of Employee’s rights, title and
interest in or with respect to such Deferred Bonus shall lapse and be of no
further force and effect. The nonvesting of Employee’s rights as to a Deferred
Bonus for any particular Base Fiscal Year shall not prejudice or adversely
affect in any way Employee’s rights, if any, to receive (or retain) a Deferred
Bonus for another Base Fiscal Year.

 

17

 

ARTICLE IV

Other Provisions

 

Section 4.1
Funding; Tax Advances.

 

(A)          Within sixty (60)
days after the amount of a Deferred Bonus for a Base Fiscal Year has been
determined pursuant to Section 2.1(B) (and assuming that Employee’s
rights thereto have not previously lapsed or vested pursuant to any of the
provisions of Article III), Employer shall pay the amount of such Deferred
Bonus to the trustee of Employer’s Deferred Bonus Trust (the “Trust”), for the
account of Employer and Employee, as their respective interests may appear,
such payment to be held, administered and disbursed in accordance with the
terms of this Agreement and the Trust. Where appropriate, all references to “Employer”
in Section 3.2 hereof shall be deemed to be references to the “Trust.”

 

(B)          If Employee’s rights
to a Deferred Bonus for a Base Fiscal Year vest under circumstances in which
the amount of the Deferred Bonus is deemed to be taxable income to the Employee
for Federal, State or local income tax purposes and Employee is, or may be,
liable to pay taxes on such deemed income before the Deferred Bonus is paid to
Employee, the Trust shall make an advance to Employee in an amount sufficient
to permit Employee to pay the full amount
of all taxes on such deemed income before such taxes shall become due. Any such
advance shall not bear interest, may be repaid to the Trust, in whole or in
part, at any time and shall, in any event, be repaid to the Trust in full at the same time the Deferred Bonus
is paid to Employee.

 

Section 4.2 No Employment Agreement.

 

This
Agreement does not constitute an employment agreement between Employer and
Employee but instead is only intended to set out the respective rights and
obligations of 

 

18

 

the parties with respect to Deferred Bonuses
for Fiscal Year 2008 and subsequent Fiscal Years. Without in any way limiting
the generality of the foregoing, it is expressly acknowledged and agreed that
Employee does not have an employment agreement with Employer and that, unless
or until the parties otherwise agree, Employee is an at-will employee of
Employer; provided, however, that Employee’s status as an at-will employee
shall not prejudice or adversely affect any of Employer’s vested rights
hereunder upon any Termination of Employment.

 

Section 4.3
Arbitration.

 

(A)          Any disagreements
which, under the provisions of Sections 2.1(B) or 3.2(C) hereof, are
referable to arbitration, shall be referred to, and finally determined by,
arbitration pursuant to the applicable Rules of Commercial Arbitration (“Rules”)
of the American Arbitration Association (“AAA”), subject to the provisions of
this Section 4.3. Employer and Employee shall each attempt to resolve any
disagreement which is referable to arbitration pursuant to Sections 2.1(B) or
3.2(C) hereof by agreement and each party agrees to negotiate in good
faith for a period of at least fifteen (15) business days after any such
disagreement has arisen. If, despite such good faith negotiations, the parties
are unable to resolve any such disagreement by agreement, then either party
may, at any time after the expiration of the foregoing period of fifteen (15)
business days, demand arbitration of such disagreement.

 

(B)          If the amount in
controversy in the arbitrable disagreement is One Hundred Thousand Dollars
($100,000) or less, the arbitration shall be conducted before a single
arbitrator selected by Employer and Employee within thirty (30) days after
service of the initial demand for arbitration. If the amount in controversy
exceeds One Hundred 

 

19

 

Thousand Dollars ($100,000), the arbitration
shall be conducted before three (3) arbitrators, one of whom shall be
selected by Employer within thirty (30) days after service of the initial
demand for arbitration, one of whom shall be selected by Employee within the
foregoing thirty (30) day period and one of whom shall be selected by the two
arbitrators selected by the parties within thirty (30) days after the second of
such arbitrators is selected. Each arbitrator selected pursuant to this Section 4.3(B) shall
be independent of both Employer and Employee and shall have at least fifteen
(15) years experience in the subject matter of the disagreement to be
arbitrated. If any arbitrator is not timely selected within the periods
provided for in this Section 4.3(B), such arbitrator shall be appointed by
the AAA pursuant to the Rules. Any arbitration pursuant to this Section 4.3
shall be conducted in Bethesda, Maryland, or in such other location as may then
be agreed by the parties. A judgment upon the award rendered in any such
arbitration shall be final and binding upon the parties and may be entered in
any court of competent jurisdiction. All fees and expenses of the arbitrator(s) and
all administrative costs of the arbitration shall be borne equally by the
parties unless the arbitrator(s) otherwise direct(s). This agreement to
arbitrate shall be specifically enforceable.

 

Section 4.4
Governing Law.

 

This
Agreement and the rights and liabilities of the parties hereunder shall be
governed by, and construed in accordance with, the laws of the State of
Maryland without regard to such State’s principles of conflicts of law.

 

20

 

Section 4.5
No Third Party Beneficiary; Spendthrift Clause.

 

(A)          This Agreement is made solely and
specifically between and for the benefit of the parties hereto and (subject to Section 4.6)
their Beneficiaries, heirs, successors, assigns and legal representatives. No
other Person whatsoever shall have any rights, interests or claims hereunder or
be entitled to any benefits under or on account of this Agreement as a third
parry beneficiary or otherwise.

 

(B)            To the maximum extent permitted by
law, neither Employee nor any Beneficiary shall have any power to dispose of or
to charge by way of anticipation any vested, potential or other right, title or
interest hereunder, and any vested Deferred Bonus payable to Employee or any
Beneficiary shall be free and clear of his debts, contracts, dispositions, and
anticipations, and shall not be taken or reached by any legal or equitable
process.

 

Section 4.6
Benefit and Burden.

 

This
Agreement, and the respective rights and obligations of the parties hereunder,
may not be assigned, sold, hypothecated, or otherwise transferred, either
outright or as security, without the prior written consent of the other party
which may be delayed, withheld or conditioned in the sole and absolute
discretion of such other party; provided, however, that Employee may designate
a Beneficiary without Employer’s consent. Any transfer, or attempted transfer,
in violation of the provisions of this Section 4.6 shall be null and void ab initio. Subject to the foregoing
provisions of this Section 4.6, the provisions of this Agreement shall be
binding upon, and shall inure to the benefit of, the parties hereto, the
Employee’s Beneficiary and their respective heirs, successors, legal
representatives and permitted assigns.

 

21

 

Section 4.7
Computation of Time.

 

In
computing any notice or other period of time prescribed or allowed by any
provision of this Agreement, the day of the act, event, or default from which
the designated period of time begins to run shall not be included. The last day
of the period so computed shall be included, unless it is a Saturday, Sunday or
a legal holiday in Bethesda, Maryland, in which event the period runs until the
end of the next, day which is not a Saturday, Sunday or such legal holiday. All
notice or other periods expire as of 5:00 p.m. (local time in Bethesda,
Maryland; on. the last day of the notice or other period.

 

Section 4.8
Entire Agreement; Amendment.

 

(A)          This Agreement contains the entire
understanding between Employer and Employee regarding the subject matter hereof
and supersedes any prior or contemporaneous understandings or agreements
between them respecting such subject matter. There are no representations,
warranties, agreements, arrangements or understandings, oral, written or expressed
by, or based upon, conduct, between the parties relating to the subject matter
hereof which are not fully expressed herein.

 

(B)           This Agreement, including the
Schedules hereto, may not be amended, modified, waived, terminated or
discharged except by an instrument in writing which is duly executed by the
party sought to be charged with any such amendment, modification, waiver,
termination or discharge.

 

Section 4.9
Construction.

 

(A)          Common nouns and pronouns shall be
deemed to refer to the masculine, feminine, neuter, singular and plural, as the
context may require.

 

22

 

(B)           All headings herein
are inserted only for convenience and ease of reference and are not to be
considered in the construction or interpretation of this Agreement.

 

(C)           Numbered or lettered
Articles, sections, subsections, subparts and subparagraphs herein contained
refer to Articles, sections, subsections, subparts and subparagraphs of this
Agreement unless otherwise expressly stated. The words “herein,” “hereof,” “hereunder,”
“hereby,” “this Agreement” and other similar references shall be construed to
mean and include this Agreement and all amendments of, supplements to, and
Schedules and other attachments to this Agreement unless the context shall
clearly indicate or require otherwise.

 

(D)           Employer and
Employee have both participated extensively in the negotiation and drafting of
this Agreement. Accordingly, this Agreement shall not be interpreted or
construed for or against either party as the draftsman hereof.

 

Section 4.10
Notices.

 

Any
notices, demands, consents, requests or other communications (hereinafter
collectively referred to in this Section 4.10 as “notice”) provided for or
permitted to be given pursuant to this Agreement shall be in writing, and shall
be delivered by hand, by first-class mail, postage prepaid (with a return
receipt requested), or by Federal Express, or by some other commercial
overnight delivery service, to the parties at the following addresses:

 

	
  (i) If
  to Employer:

  	
  Walker &
  Dunlop GP, LLC

  
	
   

  	
  7501
  Wisconsin Avenue, Suite 1200

  
	
   

  	
  Bethesda,
  Maryland 20814-6531

  
	
   

  	
  Attn:
  Mr. William M. Walker

  

 

23

 

	
  (ii) If
  to Employee:

  	
  Mr. Howard
  W. Smith III

  
	
   

  	
  2915
  44th Street, NW

  
	
   

  	
  Washington,
  DC 20016

  

 

 

Each
notice shall be deemed given on the day it is received or on the day its
delivery is refused by or for the addressee, whichever is earlier. Each party
may change its address or addressee for notice by giving notice thereof in the
manner provided above (such notice to be given at least five (5) business
days prior to its effective date).

 

IN
WITNESS WHEREOF, the parties have executed and delivered this Agreement as of
the date first above written.

 

	
   

  	
  WALKER & DUNLOP GP, LLC

  
	
   

  	
   

  
	
   

  	
  (“Employer”)

  
	
   

  	
   

  
	
   

  	
  Date:

  	
  June 16,
  2008

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/
  William Walker

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  William
  M. Walker

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  President

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Howard W. Smith III

  
	
   

  	
   

  
	
   

  	
  (“Employee”)

  
	
   

  	
   

  
	
   

  	
  Date:

  	
  June 16,
  2008

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/
  Howard W. Smith III

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Howard
  W. Smith III

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Executive
  Vice President

  

 

24

 

SCHEDULE
1-2008

 

Formulae
for Computation of Deferred Bonus

 

1.            (A) The
following is a summary of key defined terms for 2008:

 

(i)                                     Employee:
Howard W. Smith III

 

(ii)                                  Base Fiscal Year: January 1,
2008 - December 31, 2008

 

(iii)                               Financial target: The
attainment by Green Park of Adjusted Net Income of $15,144,697.00 (representing
the 2008 Budget adjusted upward by 80% of sub-servicing costs, and downward by
servicing advances)

 

(iv)                              Employee
Percentage: 6.5%.

 

(B)            Employee shall be
entitled to a Deferred Bonus in the amount equal to (i) the Employee
Percentage times (ii) the amount by which Green Park’s Adjusted Net Income
in the Base Fiscal Year exceeds the Base Financial Target, subject to all
applicable vesting provisions set forth in the foregoing and attached Incentive
Deferred Bonus Compensation Agreement (“Agreement”) of which this Schedule
1-2008 is a part. In no event shall the Deferred Bonus be less than zero.

 

2.              Green Park’s
Adjusted Net Income during any Base Fiscal Year or during any Deferred Bonus
Earn-Out Period applicable to such Base Fiscal Year (hereinafter referred to in
this Schedule 1-2008 as a “Period”) shall be determined as follows:

 

(A)            The starting point
for the determination of such Adjusted Net Income shall be Green Park’s net
income for the relevant Fiscal Year, or the relevant Period, as the case may
be, determined in accordance with generally accepted accounting principles (“Net
Income”) (such Net Income to be based on audited figures, if available, or to
become 

 

25

 

available in the ordinary course of business.
If there has not been, or is not to be in the ordinary course of business, an
independent audit to establish Green Park’s audited net income for a particular
Fiscal Year or Period, Green Park’s net income for such Fiscal Year or Period
shall be determined by Employer in accordance with generally accepted
accounting principles and all customary procedures normally utilized in
determining Green Park’s audited net income.)

 

(B)           Green Park’s Net
Income for Fiscal Year, or during a Period, shall be (i) increased by (a) any
reserves or provisions for future loan losses deducted in the computation of
such Net Income (except that any actual loan losses deducted in computing such
Net Income shall not be added back to such Net Income); and (b) any
recoveries or reimbursements received as a result of previously delinquent loan
(to the extent not already expensed or deducted in the computation of Net
Income); and (c) 80% of any subservicing fees paid to Walker &
Dunlop to service Green Park’s loans; and (ii) decreased by the amount of
net servicing and delinquency advances made as a result of delinquent loans (to
the extent not already expensed or deducted in the computation of Net Income.)

 

(C)           Green Park’s Net
Income during a Fiscal Year, as adjusted in accordance with the provisions of
Paragraph 2(B), shall be Green Park’s “Adjusted Net Income” for that Fiscal Year
for the purposes of this Schedule 1-2008.

 

(D)            Green Park’s Net Income during a
Period, as adjusted in accordance with the provisions of Paragraph 2(B), shall
be Green Park’s Net Income” for that Period for the purposes of this Schedule
1-2008.

 

(E)             Green Park’s
Adjusted Net Income during a Period shall be multiplied by a fraction, the
numerator of which shall be twelve (12) and the denominator of which shall be
the number of full calendar months in the Period, and the product of such
multiplication 

 

26

 

shall be Green Park’s “Average Adjusted Net
Income” for that Period for the purposes of this Schedule I-2008.

 

3.              The Annualized
Financial Target during the Period applicable to the Base Fiscal Year shall be
the attainment by Green Park of an Average Adjusted Net Income equal to, or
greater than the Base Financial Target.

 

4.              The operation of
the formulae set out in this Schedule 1-2008 may be illustrated by the
following examples: for these examples only, assume the following facts: (i) the
Base Fiscal Year is January 1, 2002-December 31, 2002; (ii) the
Base Financial Target is $10,000,000; and (iii) the Employee Percentage is
10%:

 

(A)            Assume that Employee remains in
Employer’s employ from January 1, 2002 until November 30, 2003, on
which date Employee has a Voluntary Resignation. Inasmuch as Employee’s
employment with Employer terminated due to a Voluntary Resignation prior to the
end of the Period applicable to the Base Fiscal Year, Employee is not entitled
to his Deferred Bonus for the Base Fiscal Year (even if Green Park achieves
both the Base Financial Target and the Annualized Financial Target.)

 

(B)           Assume that Employee remains in the
Employer’s employ throughout the Base Fiscal Year and that Green Park’s
Adjusted Net Income during the Base Fiscal Year is $11,000,000 (or $1,000,000
more than the Base Financial Target of $10,000,000 for the Base Fiscal Year.)
On these assumptions, Employee’s Deferred Bonus for the Base Fiscal Year is
$100,000 (10% [the Employee Percentage] time $1,000,000), subject to all
applicable vesting provisions set out in the Agreement.

 

(C)           Assume that Employee remains in
Employer’s employ from January 1, 2002 through June 30, 2003, on
which date Employee’s Intentional Death or Disability occurs. Further assume
that Green Park has Adjusted Net Income of $11,000,000 between January 1,
2002, and December 31, 2002, Adjusted Net Income of $10,500,000 between 

 

27

 

January 1, 2003, and December 31,
2003, and Adjusted Net Income of $10,000,000 between January 1, 2003, and December 31,
2004. On these assumptions:

 

(i)              Employee’s
Deferred Bonus for the Base Fiscal Year is $100,000 (see Paragraph 4(B) above.)

 

(ii)           Green Park’s
Average Adjusted Net Income during the Period is $10,500,000. This is
determined by multiplying $31,500,000 (Green Park’s Adjusted Net Income during
the relevant Period (which began on January 1, 2002, and ended on December 31,
2004) by a fraction, the numerator of which is twelve (12) and the denominator
of which is thirty-six (36) (the number of calendar months in the Period),
(i.e., $31,500,000 x 12/36 = $10,500,000). Since the Annualized Financial
target for the Period is the attainment by Green Park of an Average Adjusted
Net Income of $10,000,000 during the Period, and since, on the assumed facts,
Green Park’s actual Average Adjusted Net Income is $10,500,000 during the
Period, the Annualized Financial Target has been bet. Moreover, since the Base
Financial Target was exceeded during the Base Fiscal Year (i.e., Green Park had
net Annualized Income during the Base Fiscal Year in excess of $10,000,000) and
Employee’s employment with Employer did not terminate as a result of a
Voluntary Resignation or a Termination With Cause during the Period, Employee’s
rights to a Deferred Bonus Earn-Out Period ended.) Pursuant to Section 3.2(A)(i) of
the Agreement, the Deferred Bonus shall be due and payable to Employee’s legal
representative or Beneficiary within sixty (60) days after December 31,
2004 (unless the time for payment is extended pursuant to Sections 3.2(B) and
(C) of the Agreement in order to permit Employer to determine whether the
Annualized Financial Target was met during the applicable Period.)

 

(D)          Assume that Employee remains in
Employer’s employ from January 1, 2002, through June 30, 2003, on
which date Employee’s Unintentional Death or Disability occurs. Further assume
that Green Park has Adjusted Net Income of 

 

28

 

$11,000,000 between January 1, 2002 and December 31,
2002, and Adjusted Net Income of $2,500,000 between January 1, 2003, and June 30,
2003. On these assumptions:

 

(i)            Employee’s Deferred
Bonus for the Base Fiscal Year is $100,000 (see Paragraph 4(B) above.)

 

(ii)           Because Employee’s employment
terminated as a result of his/her Unintentional Death or Disability which
occurred on June 30,2003, the applicable Period for the Base Fiscal Year
began on January 1, 2002, and ended on June 30, 2003.

 

(iii)          Green Park’s Average Adjusted Net
Income during the applicable Period is $9,000,000. This is determined by
multiplying $13,500,000 (Green Park’s Adjusted Net Income during the Period)
times twelve (12) divided by eighteen (18) (the number of calendar months in
the Period), (i.e., $13,500,000 x 12/18 = $9,000,000). This Average Net Income
is less than the Annualized Financial Target (which is an Average Adjusted Net
Income of $10,000,000). However, since Employee’s employment terminated as a
result of his/her Unintentional Death or Disability, it is only necessary that
Green Park attain 65% of the Annualized Financial Target (or an Average
Adjusted Net Income of $6,500,000 ($10,000,000 x 65%) during the Period). Green
Park’s actual Average Adjusted Net Income during the Period ($9,000,000)
exceeds 65% of the Annualized Financial Target during the Period ($6,500,000)
and, therefore, on the assumed facts, the Annualized Financial Target has been
met.

 

(iv)        On
the assumed facts, Employee’s employment did not terminate as a result of a
Voluntary Resignation or a Termination With Cause occurring within the Period.
As a result, on the assumed facts, Employee’s rights to a Deferred Bonus for
the Base Fiscal Year vested on June 30, 2003 (the last day of the Period).
Because the applicable Period ended as a result of Employee’s Unintentional
Death or Disability, Employee’s Deferred Bonus for the Base Fiscal Year shall
be due and payable to Employee’s 

 

29

 

legal representative or Beneficiary within
sixty (60) days after December 31, 2004 pursuant to Section 3.1(C) of
the Agreement (unless the time for payment is extended in order to permit
Employer to determine whether the Annualized Financial Target was met during
the Period).

 

(E)            Assume that
Employee remains in Employer’s employ from January 1, 2002, through December 31,
2004. Further assume that Green Park has Adjusted Net Income of $11,000,000
between January 1, 2002, and December 31, 2002, Adjusted Net Income
of $10,500,000 between January 1, 2003, and December 31, 2003, and
Adjusted Net Income of $10,000,000 between January 1, 2004, and December 31,
2004. On these assumptions:

 

(i)            Employee’s Deferred
Bonus for the Base Fiscal Year is $100,000 (see Paragraph 4(B) above.)

 

(ii)           Green Park’s
Average Adjusted Net Income during the Period is $10,500,000 (see Paragraph
4(C)(ii) above.) Since the Annualized Financial Target for the Period is
the attainment by Green Park of an Average Adjusted Net Income of $10,000,000
during the Period, and since, on the assumed facts, Green Park’s actual Average
Adjusted Net Income is $10,500,000 during the Period, the Annualized Financial
Target has been met. Pursuant to Section 3.2(A)(i) of the Agreement,
the Deferred Bonus shall be due and payable to Employee within sixty (60) days
after December 31, 2004 (unless the time for payment is extended pursuant
to Sections 3.2(B) and (C) of the Agreement in order to permit
Employer to determine whether the Annualized Financial Target was met during
the applicable Period).

 

5.             The foregoing examples under
Paragraph 4 of this Schedule 1-2008 assume that Employee remains in Green Park’s
employ throughout the first year of the Period (i.e., throughout the Base
Fiscal Year) and that Employee’s employment with Green Park is then terminated
at some point during the remainder of such Period. If Employee’s employment 

 

30

 

with Green Park is terminated during the
first year of such Period (or at any other time during such Period) as a result
of a Voluntary Termination or a Termination With Cause, then Employee is not
entitled to his Deferred Bonus for the Base Fiscal Year. If Employee’s
employment with Green Park is terminated during the first year of such Period
for any reason other than a Voluntary Termination or a Termination With Cause,
then the computations regarding the amount of Employee’s Deferred Bonus for the
Base Fiscal Year are first made as set out in Paragraphs 1 through 3 of this
Schedule 1-2008 as adjusted by the provisions of Section 2. 1 (A)(ii)(a) of
the Agreement. The foregoing may be illustrated by the following example:

 

(A)        Assume
that the Base Financial Target and the Employee Percentage are as set out in
Paragraph 4 above; that Employee remains in Employer’s employ from January 1,
2002 until June 25, 2002, on which date Employee’s Intentional Death or
Disability occurs. Further assume that Green Park has Adjusted Net Income of
$5,500,000 between January 1, 2002, and June 30, 2002; Adjusted Net
Income of $11,000,000 between January 1, 2002 and December 31, 2002;
Adjusted Net Income of $10,500,000 between January 1, 2003 and December 31,
2003; and Adjusted Net Income of $10,000,000 between January 1, 2004 and December 31,
2004. On these assumptions:

 

(i)            Green Park’s Base
Financial Target for the Base Fiscal Year is first pro-rated pursuant to Section 2.
1 (A)(ii)(a) of the Agreement by multiplying that Target ($10,000,000 of
Adjusted Net Income) by six (6) (the number of months, rounded to the
nearest whole number, that Employee was employed by Green Park during the Base
Fiscal Year) and then dividing by twelve (12). The result (or $5,000,000 of
Adjusted Net Income) is the pro-rated Base Financial Target for Employee’s
Deferred Bonus for the Base Fiscal Year.

 

(ii)            The pro-rated Base
Financial Target for the Base Fiscal Year (or $5,000,000 of Adjusted Net
Income) is then compared with Green Park’s actual Adjusted

 

31

 

Net Income between January 1, 2002 and June 30,
2002 (or $5,500,000). Since the adjusted Target was exceeded, the amount of
Employee’s potential Deferred Bonus for the first six months of the Base Fiscal
Year is 10% (the Employee Percentage) of the excess (or $500,000) of actual
Adjusted Net Income over the adjusted Base Financial Target amount during that
six-month period, or $50,000.

 

(iii)         Notwithstanding
Employee’s Intentional Death or Disability during the Base Fiscal Year, the
other vesting and payout provisions of the Agreement are not affected (see
Agreement, Section 2. 1 (A)(ii)(b)). Since Employee’s termination of
employment was caused by his/her Intentional Death or Disability, his Deferred
Bonus is only payable under these circumstances if Green Park meets its
Annualized Financial Target during the three year Period attributable to the
Base Fiscal Year (see Agreement, Sections 1. 1 (E)(i)(a), 2. 1 (A)(ii)(b)). On
the assumed facts, Green Park meets its Annualized Financial Target during the
latter Period and, accordingly, Employee’s Deferred Bonus of $50,000 for the
Base Fiscal Year is payable to Employee’s legal representative or Beneficiary
pursuant to the Agreement (see Paragraph 4(D)(iv) above).

 

(B)            Under the example given in Paragraph
5(A), Employee’s employment with Green Park terminated (for a reason other than
a Voluntary Resignation or a Termination With Cause) during the Base Fiscal
Year but the Period attributable to that Base Fiscal Year continued beyond the
end of the Base Fiscal Year. Under certain circumstances, however, Employee’s
employment may terminate during a Base Fiscal Year and the Period applicable to
such Base Fiscal Year will also terminate during that Base Fiscal Year. In this
event, Employee’s entitlement to his Deferred Bonus is determined in accordance
with Paragraphs 1 through 3 of this Schedule 1-2005, as adjusted by the
provisions of Section 2. 1 (A)(ii)(b) of the Agreement. The foregoing
may be illustrated by the following example:

 

32

 

(Percentage are as set out in Paragraph 4 above;
that Employee remains in Employer’s employ from January 1, 2002 until June 30,
2002, at which time a Termination Without Cause occurs; and that Green Park has
Adjusted Net Income in the amounts and for the periods set out in Paragraph 5(A) above.

 

(ii)            On these
assumptions, the adjusted Base Financial Target is met for the first six months
of the Base Fiscal Year and Employee’s potential Deferred Bonus for that period
is $50,000 (see Paragraph 5(A)(ii)).

 

(i) Assume
that the Base Financial Target and the Employee Percentage are as set out in
Paragraph 4 above; that Employee remains in Employer’s employ from January 1,
2002 until June 30, 2002, at which time a Termination Without Cause occurs;
and that Green Park has Adjusted Net Income in the amounts and for the periods
as set out in Paragraph 5(A) above.

 

(ii) On
these assumptions, the adjusted Base Financial Target is met for the first six
months of the Base Fiscal Year and Employee’s potential Deferred Bonus for that
period if $50,000 (see Paragraph 5(A)(ii)).

 

(iii) Because
Employee’s employment terminated as of June 30, 2002 as a result of a
Termination Without Cause, the Period attributed to the Base Fiscal Year also
terminated as of June 30, 2002 (see Agreement, Section 1.1(E)(i)(c)).
The Annualized Financial Target for the Base Fiscal Year must, therefore, be
pro-rated by multiplying that Target ($10,000,000 of Adjusted Net Income) times
six (6) (the number of months rounded, if necessary, to the nearest whole
number, that Employee was employed by Green Park during the Base Fiscal Year)
and then dividing by twelve (12) (see Agreement, Section 2. 1 (A)(ii)(b)).
The result (or $5,000,000 of Adjusted Net Income) is the pro-rated Annualized
Financial Target for the Period attributable to the Base Fiscal Year.

 

33

 

(iv)          The pro-rated Annualized Financial
Target for the Period attributable to the Base Fiscal Year (or $5,000,000 of
Adjusted Net Income) is then compared with Green Park’s actual Adjusted Net
Income during that Period (or $5,500,000). Since the adjusted Target was
exceeded, and since the Employee’s employment during the Period was not
terminated as a result of a Voluntary Retirement or a Termination With Cause,
Employee’s Deferred Bonus for the Base Fiscal Year vests of June 30, 2002,
and is payable to him in accordance with the terms of the Agreement.

 

6.
Unless otherwise defined in this Schedule 1-2008, all capitalized words and phrases
in this Schedule 1-2008 shall have the same meanings as are ascribed to them in
the Agreement.

 

APPROVED AND ACCEPTED:

 

 

	
  /s/ William Walker

  	
   

  	
  June 16, 2008

  
	
   

  	
   

  	
   

  
	
  William
  M. Walker

  	
   

  	
  Date

  
	
   

  	
   

  	
   

  
	
  President

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  /s/
  Howard W. Smith III

  	
   

  	
  June 16,
  2008

  
	
   

  	
   

  	
   

  
	
  Howard
  W. Smith III

  	
   

  	
  Date

  
	
   

  	
   

  	
   

  
	
  Executive
  Vice President

  	
   

  	
   

  

 

34

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