Document:

exv10w12

Exhibit 10.12

EMPLOYMENT AGREEMENT

     This Employment Agreement (this “Agreement”), is entered into as of February 29, 2008 (the
“Effective Date”), between Thomas F. Fortin (“Employee”) and Regional Management Corp., a South
Carolina 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 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 employment of Employee in the service of the
Corporation, and the Employee desires to accept such employment, on the terms and conditions of
this Agreement from and after the date of this Agreement.

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

          (d) “Bonus”: as defined in Section 2.4(b).

          (e) “Business”: the business of offering short-term small loans, medium-term large loans and
related credit insurance, together with any other business or businesses conducted from time to
time by the Corporation.

          (f) “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; or (viii) the failure to disclose
material financial or other information to the Board, but, in each case, 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 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 Company policy or any Company 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.

          (g) “Change in Control”: the sale of all or substantially all of the Corporation’s business or
assets to any Person (other than one or a group of the Corporation’s shareholders collectively
beneficially owning a majority of the voting power of the Corporation or any Affiliate or related
Person of any such shareholder or group of shareholders the majority of the voting power of which
is also beneficially owned by such shareholder or group of shareholders), or any other transaction
whether by sale of stock, sale of assets, merger, recapitalization, reorganization or otherwise,
pursuant to which one or more Persons (other than one or a group of the Corporation’s shareholders
collectively beneficially owning a majority of the voting power of the Corporation or any Affiliate
or related Person of any such shareholder or group of shareholders the majority of the voting power
of which is also beneficially owned by such shareholder or group of shareholders) shall own
securities having in excess of 50% of the voting power of the Corporation, on a fully diluted
basis, in each case in a single transaction or series of related transactions.

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          (h) “Competitive Business”: as defined in Section 3.3.

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

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

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

          (l) “Disability”: a physical or mental incapacity as a result of which Employee becomes unable
to continue to perform fully his 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 that Employee will be unable to return to work and perform his duties
on a full-time basis within 90 calendar days following the date of such determination on account of
mental or physical incapacity.

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

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

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

          (p) “Employment Term”: as defined in Section 2.1.

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

          (r) “Involuntary Termination”: the termination of Employee’s employment by Employee which, in
the good faith judgment of the Employee, is due to (i) a material change of Employee’s
responsibilities, position (including status 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 change in the terms or status (including the Employment
Period) of this Agreement; or (iii) a reduction in the Employee’s Salary.

          (s) “Management Incentive Plan”: the Management Incentive Plan of the Corporation adopted on
March 21, 2007.

          (t) “Option Award Agreement”: the Option Award Agreement between the Corporation and Employee
under the Management Incentive Plan executed on the date of execution of this Agreement.

          (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) “Plan”: the annual financial and operating plan for the Corporation for a given year as
approved by the Board, which shall include Net Income, Net Finance Receivables,

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Total General and Administrative Expenses and Loans Charged Off targets for the purpose of
determining the Bonus Employee will receive for that year.

          (w) “Salary”: as defined in Section 2.4(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
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. This Agreement and Employee’s employment hereunder will
commence on the Effective Date and terminate on the fifth anniversary of the Effective Date (the
“Employment Term”), 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,” and the date on which this Agreement terminates pursuant to this Section 2.1 or Section
2.7 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 as set forth in 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, Employee will not engage in any business activity, whether as an employee, investor,
officer, director, consultant, independent contractor or otherwise, that would

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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 $350,000. The Board may review the amount of Salary
from time to time, and the Board may adjust Salary upwards after any such review, with any such
upward adjustments effective as of the dates determined by the Board. Employee’s Salary will be
payable to Employee periodically with the normal practices of the Corporation and less all
previously authorized or legally required deductions and withholding.

          (b) Bonus. At the beginning of each calendar year during the Employment Period other
than 2008 in connection with the Board’s approval of the Company’s annual plan for that calendar
year, the Board shall establish and communicate to Employee performance criteria for the Company
and/or Employee and one or more objective formula(s) for determining Employee’s bonus payment (the
"Bonus”) for that calendar year. The performance criteria and objective formulas for the 2008
calendar year are set forth in Exhibit A hereto. If Employee is employed by the Corporation on the
last day of the applicable calendar year, Employee will be entitled to receive a Bonus in an amount
determined in accordance with such objective formula(s) set by the Board based on the actual
performance of the Company and/or Employee relative to the performance criteria established by the
Board for that year. The formulas shall include an aggregate “Target Bonus” for any given calendar
year equal to fifty percent (50%) of Employee’s Salary in effect at the beginning of that calendar
year. Any Bonus due to Employee pursuant to this Section 2.4(b) shall be paid in cash in a lump sum
within 15 calendar days after the completion of the year-end audited financial statements for the
applicable calendar year. 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. Pursuant to the terms and conditions set forth in the
Company’s Management Incentive Plan, the Corporation will grant to Employee a stock option to
acquire 196,563 shares of common stock of the Corporation pursuant to the Option Award Agreement.
Subject to the terms and conditions of the Management Incentive Plan and the Option Award
Agreement, the stock option will vest on the following schedule, depending on whether Employee is
an employee of the Corporation on the following dates: as to one-fifth of the shares of common
stock on the date of the Option Award Agreement, an additional one-fifth of such shares on March
21, 2009, an additional one-fifth of such shares on March 21, 2010, an additional one-fifth of such
shares on March 21, 2011 and the remaining one-fifth of such shares on March 21, 2012. For the
avoidance of doubt, the stock option will not be subject to any vesting provisions based on the
satisfaction of financial or performance criteria. Notwithstanding the foregoing, any portion of
the stock option that has not vested under this schedule will

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automatically vest upon a Change in Control. The exercise price for the option shall be equal
to $5.4623 per share, which the parties acknowledge is the implicit price per share in connection
with an investment in the Corporation by affiliates of Parallel Investment Partners, LP and
Palladium Capital Management III, L.L.C. on March 21, 2007.

     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. Employee shall be entitled to paid vacation time of four weeks for
calendar year 2008 and then the amount provided by the vacation policy of the Corporation
thereafter, subject to fulfillment of his duties hereunder, in accordance with the vacation policy
of the Corporation. Employee shall also be entitled to all paid holidays and to reasonable sick
leave in accordance with the policies of the Corporation applicable to its executive management.
Unused vacation may not be carried over by Employee from one calendar year to the next.
Notwithstanding the foregoing, such vacation, holidays and sick leave shall not accrue as a
monetary liability of the Corporation.

          (c) Expenses. Subject to compliance with the Corporation’s policies as from time to
time in effect regarding the incurrence, substantiation and verification 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. Employees acknowledges and agrees that the provisions of Paragraph 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.

          (d) Car Allowance and Mileage Reimbursement. The Corporation will provide to Employee
a monthly car allowance of $1,150, payable during the Employment Period. In addition, the
Corporation will, in accordance with the Corporation’s general personal vehicle use reimbursement
policy (except for price which shall be as provided in this paragraph 2.5(d)), reimburse Employee
an amount equal to $0.15 for each mile he drives a personal car in connection with the performance
of his duties as an employee of the Corporation.

     2.6 Deductions and Withholdings. All amounts payable or that become payable under
this Agreement will be subject to any deductions and withholdings required by law.

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     2.7 Termination.

          (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 for a period of six
months from and after the Termination Date; provided, however, that such payment of
Salary will be reduced by the amount of any salary, wages or other income paid to or for the
benefit of Employee from any other employment during such six- month period, and (iii) a pro-rata
portion of the Bonus for the year in which Employee’s Termination Date occurs (such amount to be
calculated by determining the Bonus 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 yearend but before the Bonus for the preceding year is
paid, the Bonus for the preceding year. Such Salary and Bonus will be paid as and at such times as
Employee would have otherwise received his Salary and Bonus had he remained an employee of the
Corporation. 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 Section 2.5 (subject to completion of expense reports
customarily required by the Corporation). 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 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 and (ii) all unreimbursed
expenses incurred by Employee prior to the Termination Date for which Employee is entitled to
reimbursement pursuant to Section 2.5 (subject to completion of expense reports customarily
required by the Corporation). 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 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 and (ii) all expenses incurred by Employee prior to the Termination Date for which
Employee is entitled to reimbursement pursuant to Section 2.5 (subject to completion of expense
reports customarily required by the Corporation). 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

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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 a
period of six months from and after the Termination Date; provided, however, that
such payment of Salary will be reduced by the amount of any salary, wages or other income paid to
or for the benefit of Employee from any other employment during such six- month period, and (iii) a
pro-rata portion of the Bonus for the year in which Employee’s Termination Date occurs (such amount
to be calculated by determining the Bonus 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 Bonus for the
preceding year is paid, the Bonus for the preceding year. Such Salary and Bonus will be paid as and
at such times as Employee would have otherwise received his Salary and Bonus had he remained an
employee of the Corporation. 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 Section 2.5 (subject to completion of expense
reports customarily required by the Corporation). 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 Section 2.5
(subject to completion of expense reports customarily required by the Corporation), and (iii) a
pro-rata portion of the Bonus for the year in which Employee’s death occurs (such amount to be
calculated by determining the Bonus 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 Bonus for the preceding year is paid, the
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 Bonus
will be paid as and at such times as Employee would have otherwise received his 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

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Disability, the Corporation will pay to Employee an amount equal to Employee’s Salary in
effect on the Termination Date for a period of six months from and after the Termination Date;
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 and by the amount of any salary, wages or other
income paid to or for the benefit of Employee from any other employment. 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 Disability for which Employee is entitled to reimbursement pursuant to
Section 2.5 (subject to completion of expense reports customarily required by the Corporation) and
(iii) a pro-rata portion of the Bonus for the year in which Employee’s Disability occurs (such
amount to be calculated by determining the Bonus as of the end of the year in which the Disability
occurs and pro-rating such amount by the portion of such year Employee was employed by the
Corporation), plus, if Employee’s Disability occurs after year-end but before the Bonus for the
preceding year is paid, the 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 Disability. Any Bonus will be paid as and at such times as Employee would have otherwise
received his Bonus had he remained an employee of the Corporation. This Agreement in all other
respects will terminate upon the Disability of Employee, except as otherwise provided in this
Agreement.

          (g) Payment of COBRA Premiums. For so long as the Corporation shall be obligated to
continue salary payments after the Termination Date as described in Sections 2.7(a), 2.7(d) or
2.7(f) (the “Severance Period”), the Corporation agrees to pay Employee the COBRA premium
applicable to Employee for comparable coverage under the Corporation’s group medical plan, payable
in arrears at the end of each calendar month during such period; provided, however, that if at any
time during the Severance Period Employee becomes entitled to receive health insurance from a
subsequent employer, the Corporation’s obligation to continue salary payments to Employee shall
terminate immediately. 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.

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

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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.

11

 

     3.3 Non-Competition. During the Employment Period and for three years after the
termination of Employee’s employment, Employee will not, directly or indirectly, engage in any
business activities, whether as an advisor, principal, owner, director, officer, agent, employee,
partner, contractor, investor, lender, stockholder, associate, consultant or otherwise, that are or
intend to be in competition with the Corporation or its subsidiaries (a “Competitive Business”);
provided that the Consultant may purchase or otherwise acquire up to (but not in excess of)
1% of any class of securities of any person, including a Competitive Business (but without
otherwise participating in the activities of such enterprise), if such securities are listed on any
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 Non-Solicitation. During the Employment Period and for three years after the
termination of Employee’s employment, Employee will not:

          (a) Directly or indirectly solicit, or attempt to persuade, influence or induce, or assist any
other Person in so persuading or inducing, any customer or supplier of the Corporation or its
Subsidiaries to cease doing business with the Corporation or any of its Subsidiaries or to reduce
the amount of business it does with the Corporation or any of its Subsidiaries. Employee
acknowledges that this covenant is necessary to enable the Corporation and its Subsidiaries to
maintain a stable customer and supplier base and in order to remain in business, and that it would
disrupt, damage, impair and interfere with the Business if Employee were to engage in such
solicitation.

          (b) Directly or indirectly solicit, or attempt to persuade, influence or induce, or assist any
other Person in so persuading or inducing, any employee of the Corporation or its Subsidiaries to
leave the employ of the Corporation or its Subsidiaries, or to accept any other employment or
position unless (in each case prior to any such inducement or attempted inducement) such employee
is no longer employed by the Corporation or its Subsidiaries or has given written notice to the
Corporation of his intention to terminate employment with the Corporation or its Subsidiaries.
Employee acknowledges that the purpose of this covenant is to enable the Corporation and its
Subsidiaries to maintain a stable workforce in order to remain in business, and that it would
disrupt, damage, impair and interfere with the Corporation’s and its Subsidiaries’ businesses if
Employee were to engage in such solicitation.

     3.5 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 in any Competitive Business 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.

     3.6 Specific Performance and Modification.

          (a) Employee acknowledges that the Corporation will have no adequate remedy at law if Employee
breaches any of the provisions of Article III. In the event of such a breach, Employee agrees that
the Corporation will have the right, in addition to any other rights it may have, to specific
performance of Article III. If legal proceedings are commenced by the Corporation against Employee,
in connection with Article III, the party that does not prevail in

12

 

such proceedings shall pay the reasonable out-of-pocket expenses, including, without
limitation, reasonable attorneys’ fees, disbursements and other costs and expenses, including
investigation costs, incurred by the prevailing party in such proceedings, arising out of or in
connection with the Corporation’s claim under Article III.

          (b) If any provision of Section 3.3 or Section 3.4 of this Agreement or the application of any
such provision to any Person or circumstance shall be determined by any court of competent
jurisdiction to be unenforceable by reason of its being extended for too great a period of time or
too large a geographic area or over too great a range of activities, it should be interpreted to
extend only over the maximum period of time, geographic area, or range of activities as to which
such court would find it enforceable, and such determination of unenforceability will not affect
any other provision of this Agreement.

     3.7 Survival. The provisions contained in this Article III will survive termination
of this Agreement regardless of whether such termination is initiated by the Corporation.

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: C. Glynn Quattlebaum

and

Parallel Investment Partners, L.P.

2100 McKinney St., Suite 1200

Dallas, Texas 75201

Facsimile No.: (214) 740-3630

Attention: Ellery W. Roberts

and

13

 

c/o Palladium Equity Partners III, L.P.

1270 Avenue of the Americas, 22nd Floor

New York, New York 10020

Fax: (212) 218-5155

Attention: David Perez and Erik A. Scott

with a copy to:

Wyche, Burgess, Freeman & Parham, P.A.

44 E. Camperdown Way (29601)

Post Office Box 728

Greenville, SC 29602-0728

Facsimile No.: (864) 235-8900

Attention: Eric K. Graben

	 	(b)	 	If to Employee, to:

Thomas F. Fortin

4833 Broad Hollow Drive

Charlotte, North Carolina 28226

With a copy to:

Womble, Carlyle, Sandridge & Rice, PLLC

550 South Main Street, Suite 400

Greenville, SC 29601

Facsimile No.: (864) 255-5870

Attention; Sandi R. Wilson

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, each party will pay all of their respective expenses incurred in connection with the
negotiation of

14

 

this Agreement, and subject to Section 2.5, 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 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.

     4.6 Governing Law. This Agreement shall be governed by, construed, applied and
enforced in accordance with the laws of the State of New York except that no doctrine of choice of
law shall be used to apply any law other than that of New York and no defense, counterclaim or
right of setoff given or allowed by the laws of any other state or jurisdiction, or arising out of
the enactment, modification or repeal of any law, regulation, ordinance or decree of any foreign
jurisdiction, be interposed in any action hereon. Employee and the Corporation agree that any
action or proceeding to enforce or arising out of this Agreement shall be commenced in the courts
of the State of Georgia or the United States District Courts in Atlanta, Georgia. Employee and the
Corporation consent to such jurisdiction, agree that venue will be proper in such courts and waive
any objections based upon forum non conveniens. The choice of forum set forth in this Section 4.6
will not be deemed to preclude the enforcement of any judgment obtained in such forum or the taking
of any action under this Agreement to enforce same in any other jurisdiction.

     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

15

 

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 and the Option Award Agreement constitute the
entire agreement among the parties with respect to the subject matter hereof and supersedes all
prior agreements and understandings, both oral and written, between the parties with respect to the
subject matter of this Agreement and the Option Award 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 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 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 shareholders, directors, or lenders will have any obligation or liabilities in
respect of this Agreement and the subject matter hereof.

[Remainder of Page Intentionally Left Blank]

16

 

     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/  C. Glynn Quattlebaum
	 

	 	 	 	 
 
	 

	 	Name:	 	C. Glynn Quattlebaum
	 

	 	 	 	 
 
	 

	 	Title:	 	President/COO
	 
	 	 	 	 

	 
	 	 	 	 
	 	 	/s/  Thomas
F. Fortin
	 	 	Thomas F. Fortin

[Signature Page to Employment Agreement]

 

 

Exhibit A

Performance Targets and Bonus Formulas for Calendar Year 2008

     This Exhibit A sets forth the performance targets and formulas for calculating Employee’s
calendar year 2008 Bonus if Employee remains employed by the Corporation on the last day of
Calendar 2008. The 2008 Bonus is divided into four components. Each component is subject to
satisfaction of its own financial test set forth below. The total Bonus may include all, some, one
or none of the components depending on whether the financial tests for the different components are
met for calendar year 2008:

     (i) If the Corporation’s Net Income for calendar year 2008 is (A) equal to or greater
than 100% but less than 110% of the Target Net Income for 2008, Employee will be entitled to
a Bonus equal to 30% of the Target Bonus, and (B) equal to or greater than 110% of the
Target Net Income for 2008, Employee will be entitled to a Bonus equal to 35% of the Target
Bonus;

     (ii) If the Corporation’s Net Finance Receivables at December 31, 2008 are (A) equal to
or greater than 100% but less than 110% of the Target Net Finance Receivables, Employee will
be entitled to a Bonus equal to 30% of the Target Bonus, and (B) equal to or greater than
110% of the Target Net Finance Receivables, Employee will be entitled to a Bonus equal to
35% of the Target Bonus;

     (iii) If the Corporation’s Total General and Administrative Expenses for a calendar
year 2008 are (A) equal to or less than 100% but greater than 90% of the Target Total
General and Administrative Expenses for 2008, Employee will be entitled to a Bonus equal to
20% of the Target Bonus, and (B) equal to or less than 90% of the Target Total General and
Administrative Expenses for 2008, Employee will be entitled to a Bonus equal to 25% of the
Target Bonus; and

     (iv) If the Corporation’s Loans Charged Off for calendar year 2008 are (A) equal to or
less than 100% but greater than 90% of the Target Loans Charged Off for 2008, Employee will
be entitled to a Bonus equal to 20% of the Target Bonus, and (B) equal to or less than 90%
of the Target Loans Charged Off for 2008, Employee will be entitled to a Bonus equal to 25%
of the Target Bonus.

     Capitalized terms used in this Exhibit A and not defined elsewhere in the Agreement
have the definitions set forth below.

     (a) “Consolidated”; as it applies to the Corporation, the Corporation and its Subsidiaries on
a consolidated basis in accordance with GAAP, after eliminating all intercompany items.

     (b) “GAAP”: generally accepted accounting principles in effect from time to time in the United
States of America, applied on a consistent basis.

18

 

     (c) “Loans Charged Off”: for any period, the Consolidated aggregate amount of loans charged
off (including principal and interest) of the Corporation, determined in accordance with GAAP.

     (d) “Net Income”: for any period, the Consolidated net income of the Corporation, determined
in accordance with GAAP.

     (e) “Net Finance Receivables”: at any date, the Consolidated finance receivables, net of the
Corporation, determined in accordance with GAAP.

     (f) “Plan” means the 2008 Annual Plan for the Corporation approved by the Board at its January
9, 2008 meeting.

     (g) “Target Loans Charged Off”: the target amount of Loans Charged Off for calendar year 2008
set forth in the Plan by the Board.

     (h) “Target Net Income”: the target amount of Net Income for calendar year 2008 set forth in
the Plan by the Board.

     (i) “Target Net Finance Receivables”: the target amount of Net Finance Receivables at December
31, 2008 set forth in the Plan by the Board.

     (j) “Target Total General and Administrative Expenses”: the target amount of Total General and
Administrative Expenses for calendar year 2008 set forth in the Plan by the Board.

     (k) “Total General and Administrative Expenses”: for any period, the Consolidated total
general and administrative expenses of the Corporation determined in accordance with GAAP.

     Illustration: Solely for purposes of illustrating the calculation of the Bonus contemplated in
this Exhibit A, if the Company’s (i) Net Income for calendar year 2008 is 98% of Target Net Income
for that year, (ii) Net Finance Receivables at December 31, 2008 year are 102% of Target Net
Finance Receivables for that year, (iii) Total General and Administrative Expenses for calendar
year 2008 are 88% of Target General and Administrative Expenses for that year, and (iv) Loans
Charged Off for calendar year 2008 are 102% of Target Loans Charged Off for that year, then the
Bonus would be (0% + 30% + 25% + 0%) of $175,000 or $96,250.

19

 

FIRST AMENDMENT TO

EMPLOYMENT AGREEMENT

BETWEEN

REGIONAL MANAGEMENT CORP. AND THOMAS F. FORTIN

     This
First Amendment Employment Agreement
(“Amendment”) is made and entered into this
18th day
of July, 2008, by and between Thomas F. Fortin (“Employee”) and Regional Management Corp., a
South Carolina corporation (“Corporation”).

W I T N E S S E T H

     WHEREAS, the Employee and the Corporation entered into an Employment Agreement dated February
29, 2008 (“Agreement”); and

     WHEREAS, the Employee and the Corporation desire to amend the Agreement.

     NOW, THEREFORE, in consideration of the premises and mutual covenants and agreements contained
herein and other good and valuable consideration, the receipt of which is hereby acknowledged, the
parties hereto agree as follows:

	1.	 	Section 2.4(b) of the Agreement shall be amended and restated in its entirety to read as
follows:

          (b) Bonus. At the beginning of each calendar year during the Employment Period
other than 2008 in connection with the Board’s approval of the Company’s annual plan for
that calendar year, the Board shall establish and communicate to Employee performance
criteria for the Company and/or Employee and one or more objective formula(s) for
determining Employee’s bonus payment (the “Bonus”) for that calendar year. The performance
criteria and objective formulas for the 2008 calendar year are set forth in Exhibit A
hereto. If Employee is employed by the Corporation on the last day of the applicable
calendar year, Employee will be entitled to receive a Bonus in an amount determined in
accordance such objective formula(s) set by the Board based on the actual performance of the
Company and/or Employee relative to the performance criteria established by the Board for
that year. The formulas shall include an aggregate “Target Bonus” for any given calendar
year equal to fifty percent (50%) of Employee’s Salary in effect at the beginning of that
calendar year. Any Bonus due to Employee pursuant to this Section 2.4(b) shall be paid in
cash in a lump sum within 15 calendar days after the completion of the year-end audited
financial statements for the applicable calendar year, and in no event later than March 14
of the calendar year following the applicable calendar year. 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.

 

 

	2.	 	Exhibit A of the Agreement shall be amended and restated in its entirety to read as follows:

Exhibit A

Performance Targets and Bonus Formulas for Calendar Year 2008

     This Exhibit A sets forth the performance targets and formulas for calculating
Employee’s calendar year 2008 Bonus if Employee remains employed by the Corporation on the
last day of Calendar 2008. The 2008 Bonus is divided into four components. Each component is
subject to satisfaction of its own financial test set forth below. The total Bonus may
include all, some, one or none of the components depending on whether the financial tests
for the different components are met for calendar year 2008:

     (i) If the Corporation’s Net Income for calendar year 2008 is (A) equal to or greater
than 100% but less than 110% of the Target Net Income for 2008, Employee will be entitled to
a Bonus equal to 30% of the Target Bonus, and (B) equal to or greater than 110% of the
Target Net Income for 2008, Employee will be entitled to a Bonus equal to 35% of the Target
Bonus;

     (ii) If the Corporation’s average monthly Net Finance Receivables for the year ending
December 31, 2008 are (A) equal to or greater than 100% but less than 110% of the Target Net
Finance Receivables, Employee will be entitled to a Bonus equal to 30% of the Target Bonus,
and (B) equal to or greater than 110% of the Target Net Finance Receivables, Employee will
be entitled to a Bonus equal to 35% of the Target Bonus;

     (iii) If the Corporation’s Total General and Administrative Expense Percentage for
calendar year 2008 is (A) equal to or less than 100% but greater than 90% of the Target
Total General and Administrative Expense Percentage for 2008, Employee will be entitled to a
Bonus equal to 20% of the Target Bonus, and (B) equal to or less than 90% of the Target
Total General and Administrative Expense Percentage for 2008, Employee will be entitled to a
Bonus equal to 25% of the Target Bonus; and

     (iv) If the Corporation’s Loans Charged Off for calendar year 2008 are (A) equal to or
less than 100% but greater than 90% of the Target Loans Charged Off for 2008, Employee will
be entitled to a Bonus equal to 20% of the Target Bonus, and (B) equal to or less than 90%
of the Target Loans Charged Off for 2008, Employee will be entitled to a Bonus equal to 25%
of the Target Bonus.

     Capitalized terms used in this Exhibit A and not defined elsewhere in the Agreement
have the definitions set forth below.

     (a) “Consolidated”: as it applies to the Corporation, the Corporation and its Subsidiaries on
a consolidated basis in accordance with GAAP, after eliminating all intercompany items.

2

 

     (b) “GAAP”: generally accepted accounting principles in effect from time to time in the United
States of America, applied on a consistent basis.

     (c) “Loans Charged Off”: for any period, the Consolidated aggregate amount of loans charged
off (including principal and interest) of the Corporation, determined in accordance with GAAP.

     (d) “Net Income”: for any period, the Consolidated net income of the Corporation, determined
in accordance with GAAP.

     (e) “Net Finance Receivables”: at any date, the Consolidated net finance receivables of the
Corporation (prior to any allowance for loan losses), determined in accordance with GAAP.

     (f) “Plan” means the 2008 Annual Plan for the Corporation approved by the Board at its January
9, 2008 meeting.

     (g) “Target Loans Charged Off”: the target amount of Loans Charged Off for calendar year 2008
set forth in the Plan by the Board (6.6% for 2008).

     (h) “Target Net Income”: the target amount of Net Income for calendar year 2008 set forth in
the Plan by the Board ($9,000,000 for 2008).

     (i) “Target Net Finance Receivables”: the target amount of average Net Finance Receivables for
the year ending December 31, 2008 set forth in the Plan by the Board ($163,900,000 for 2008).

     (j) “Target Total General and Administrative Expense Percentage”: the Total General and
Administrative Expense Percentage for calendar year 2008 set forth in the Plan by the Board (43.5%
of total income, based on a plan of $27,392,000 for 2008).

     (k) “Total General and Administrative Expense Percentage”: for any period, the Consolidated
total general and administrative operating expenses of the Corporation divided by the total income
of the Corporation, in each case determined in accordance with GAAP and expressed as a percentage.

     Illustration: Solely for purposes of illustrating the calculation of the Bonus contemplated in
this Exhibit A, if the Company’s (i) Net Income for calendar year 2008 is 98% of Target Net Income
for that year, (ii) Net Finance Receivables for the year ending December 31, 2008 year are 102% of
Target Net Finance Receivables for that year, (iii) the Total General and Administrative Expense
Percentage for calendar year 2008 is 88% of the Target Total General and Administrative Expense
Percentage for that year, and (iv) Loans Charged Off for calendar year 2008 are 102% of Target
Loans Charged Off for that year, then the Bonus would be (0% + 30% + 25% + 0%) of $175,000 or
$96,250.

	3.	 	The parties hereby agree that the Agreement will continue to be in full force and effect as
modified by the terms of this Amendment.

3

 

     IN WITNESS WHEREOF, the parties have executed this Amendment as of the day and year first
above written.

	 	 	 	 	 	 	 

	 	 	EMPLOYEE:	 	 
	 
	 	 	 	 	 	 
	 	 	/s/ Thomas F. Fortin	 	 
	 	 	 	 	 
	 	 	THOMAS F. FORTIN	 	 
	 
	 	 	 	 	 	 
	 	 	CORPORATION:	 	 
	 
	 	 	 	 	 	 
	 	 	REGIONAL MANAGEMENT CORP.	 	 
	 
	 	 	 	 	 	 
	 

	 	By:	 	/s/ C. Glynn Quattlebaum 	 	 
	 

	 	 	 	 

	 	 
	 
	 	 	 	 	 	 
	 

	 	Title:	 	President/COO 	 	 
	 

	 	 	 	 

	 	 

4

 

SECOND AMENDMENT TO

EMPLOYMENT AGREEMENT

BETWEEN

REGIONAL MANAGEMENT CORP. AND THOMAS F. FORTIN

     This Second Amendment to Employment Agreement (“Amendment”) is made and entered into this 14th
day of April, 2009, by and between Thomas F. Fortin (“Employee”) and Regional Management Corp.,
a South Carolina corporation (“Corporation”).

W I T N E S S E T H

     WHEREAS, the Employee and the Corporation entered into an Employment Agreement dated February
29, 2008, as amended (“Agreement”); and

     WHEREAS, the Employee and the Corporation desire to amend the Agreement effective January 1,
2009.

     NOW, THEREFORE, in consideration of the premises and mutual covenants and agreements contained
herein and other good and valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties hereto agree as follows:

	1.	 	Section 2.4(b) of the Agreement shall be amended and restated in its entirety effective
January 1, 2009 to read as follows:

          (b) Bonus. At the beginning of each calendar year during the Employment Period
in connection with the Board’s approval of the Company’s annual plan for that calendar year,
the Board shall establish and communicate to Employee performance criteria for the Company
and/or Employee and one or more objective formula(s) for determining Employee’s bonus
payment (the “Bonus”) for that calendar year. The performance criteria and objective
formulas for the 2009 calendar year are set forth in Exhibit A hereto. If Employee is
employed by the Corporation on the last day of the applicable calendar year, Employee will
be entitled to receive a Bonus in an amount determined in accordance with such objective
formula(s) set by the Board based on the actual performance of the Company and/or Employee
relative to the performance criteria established by the Board for that year. The formulas
shall include an aggregate “Target Bonus” for any given calendar year equal to fifty-one and
one half percent (51.5%) of Employee’s Salary in effect at the beginning of that calendar
year. Any Bonus due to Employee pursuant to this Section 2.4(b) shall be paid in cash in a
lump sum within 15 calendar days after the completion of the year-end audited financial
statements for the applicable calendar year, and in no event later than March 14 of the
calendar year following the applicable calendar year. 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.

	2.	 	Exhibit A of the Agreement shall be amended and restated in its entirety effective January 1,
2009 to read as follows:

 

 

Exhibit A

Performance Targets and Bonus Formulas for Calendar Year 2009

     This Exhibit A sets forth the performance targets and formulas for calculating
Employee’s calendar year 2009 Bonus if Employee remains employed by the Corporation on the
last day of calendar year 2009. The 2009 Bonus is divided into four components. Each
component is subject to satisfaction of its own financial test set forth below. The total
Bonus may include all, some, one or none of the components depending on whether the
financial tests for the different components are met for calendar year 2009:

     (i) If the Corporation’s Net Income From Operations for calendar year 2009 is (A) equal
to or greater than 90% but less than 100% of the Target Net Income From Operations for 2009,
Employee will be entitled to a Bonus equal to 40% of the Target Bonus multiplied by a
fraction, the numerator of which is equal the Corporation’s Net Income From Operations for
2009 expressed as a percentage of the Target Net Income From Operations for 2009 minus 90%,
and the denominator of which is equal to 10%, or (B) equal to or greater than 100% of the
Target Net Income From Operations for 2009, Employee will be entitled to a Bonus equal to
40% of the Target Bonus;

     (ii) If the Corporation’s average monthly Net Finance Receivables for the year ending
December 31, 2009 are (A) equal to or greater than 100% but less than 110% of the Target Net
Finance Receivables, Employee will be entitled to a Bonus equal to 20% of the Target Bonus,
or (B) equal to or greater than 110% of the Target Net Finance Receivables, Employee will be
entitled to a Bonus equal to 25% of the Target Bonus;

     (iii) If the Corporation’s Total General and Administrative Expense Percentage for
calendar year 2009 is (A) equal to or less than 100% but greater than 90% of the Target
Total General and Administrative Expense Percentage for 2009, Employee will be entitled to a
Bonus equal to 20% of the Target Bonus, or (B) equal to or less than 90% of the Target Total
General and Administrative Expense Percentage for 2009, Employee will be entitled to a Bonus
equal to 25% of the Target Bonus; and

     (iv) If the Corporation’s Net Loans Charged Off for calendar year 2009 are (A) equal to
or less than 8% but greater than 7.25% (100% of the Target Net Loans Charged Off for 2009),
Employee will be entitled to a Bonus equal to 20% of the Target Bonus multiplied by a
fraction, the numerator of which is equal to 8% minus the Corporation’s Net Loans Charged
Off for 2009 expressed as a percentage, and the denominator of which is .75%, or (B) equal
to 7.25% (100% of the Target Net Loans Charged Off for 2009), Employee will be entitled to a
Bonus equal to 20% of the Target Bonus; and (C) less than 7.25% (100% of the Target Net
Loans Charged Off for 2009) but equal to or greater than 7%, Employee will be entitled to a
Bonus equal to 20% of the Target Bonus plus the product of 2% of the Target Bonus and a
fraction, the numerator of which is equal to 7.25% minus the Corporation’s Net Loans Charged
Off for 2009 expressed as a percentage, and the denominator of which is .25%.

2

 

     Capitalized terms used in this Exhibit A and not defined elsewhere in the Agreement
have the definitions set forth below.

(a) “Consolidated”: as it applies to the Corporation, the Corporation and its Subsidiaries
on a consolidated basis in accordance with GAAP, after eliminating all intercompany items.

(b) “GAAP”: generally accepted accounting principles in effect from time to time in the
United States of America, applied on a consistent basis. All amounts determined in
accordance with GAAP shall be reviewed by the Corporation’s outside CPA film.

(c) “Net Finance Receivables”: at any date, the Consolidated net finance receivables of the
Corporation (prior to any allowance for loan losses and net of unearned interest and fees),
determined in accordance with GAAP.

(d) “Net Income From Operations”: for any period, the Consolidated net income from
operations of the Corporation, determined in accordance with GAAP.

(e) “Net Loans Charged Off”: for any period, the Consolidated aggregate amount of loans
charged off net of recoveries (prior to allowances and net of unearned interest and fees) of
the Corporation, determined in accordance with GAAP.

(f) “Plan” means the 2009 Annual Plan for the Corporation approved by the Board at its
January 9, 2009 meeting.

(g) “Target Net Finance Receivables”: the target amount of average Net Finance Receivables
for the year ending December 31, 2009 set forth in the Plan by the Board ($194,649 for
2009).

(h) “Target Net Income From Operations”: the target amount of Net Income From Operations for
calendar year 2009 set forth in the Plan by the Board ($12,567 for 2009).

(i) “Target Net Loans Charged Off”: the target amount of Net Loans Charged Off for calendar
year 2009 set forth in the Plan by the Board (7.25% for 2009).

(j) “Target Total General and Administrative Expense Percentage”: the target Total General
and Administrative Expense Percentage for calendar year 2009 set forth in the Plan by the
Board (42.37% of total revenue, based on plan revenues of $71,974 for 2009).

(k) “Total General and Administrative Expense Percentage”: for any period, the Consolidated
total general and administrative operating expenses of the Corporation divided by the total
revenue of the Corporation, in each case determined in accordance with GAAP and expressed as
a percentage.

     Illustration: Solely for purposes of illustrating the calculation of the Bonus
contemplated in this Exhibit A, if the Company’s (i) Net Income From Operations for calendar
year 2009 is 98% of Target Net Income From Operations for that year, (ii) Net

3

 

Finance Receivables for the year ending December 31, 2009 are 102% of Target Net
Finance Receivables for that year, (iii) the Total General and Administrative Expense
Percentage for calendar year 2009 is 88% of the Target Total General and Administrative
Expense Percentage for that year, and (iv) Net Loans Charged Off for calendar year 2009 are
102% of Target Net Loans Charged Off for that year, then the Bonus would be (32% + 20% + 25%
+ 16.13%) of $180,250 or $167,866.83.

	3.	 	The parties hereby agree that the Agreement will continue to be in full force and effect as
modified by the terms of this Amendment.

          IN WITNESS WHEREOF, the parties have executed this Amendment as of the day and year
first above written.

	 	 	 	 	 	 	 

	 	 	EMPLOYEE:	 	 
	 
	 	 	 	 	 	 
	 	 	/s/ Thomas F. Fortin	 	 
	 	 	 	 	 
	 	 	THOMAS F. FORTIN	 	 
	 
	 	 	 	 	 	 
	 	 	CORPORATION:	 	 
	 
	 	 	 	 	 	 
	 	 	REGIONAL MANAGEMENT CORP.	 	 
	 
	 	 	 	 	 	 
	 

	 	By:	 	/s/ Robert D. Barry 	 	 
	 

	 	 	 	 

	 	 
	 
	 	 	 	 	 	 
	 

	 	Title:	 	EVP/CFO 	 	 
	 

	 	 	 	 

	 	 

4

 

THIRD AMENDMENT TO

EMPLOYMENT AGREEMENT

BETWEEN

REGIONAL MANAGEMENT CORP. AND THOMAS F. FORTIN

     This Third Amendment to Employment Agreement (“Amendment”) is made and entered into this 13th
day of April, 2010, by and between Thomas F. Fortin (“Employee”) and Regional Management Corp.,
a South Carolina corporation (“Corporation”).

W I T N E S S E T H

     WHEREAS, the Employee and the Corporation entered into an Employment Agreement dated February
29, 2008, as amended (“Agreement”); and

     WHEREAS, the Employee and the Corporation desire to amend the Agreement effective January 1,
2010.

     NOW, THEREFORE, in consideration of the premises and mutual covenants and agreements contained
herein and other good and valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties hereto agree as follows:

	1.	 	Section 2.4(b) of the Agreement shall be amended and restated in its entirety effective
January 1, 2010 to read as follows:

          (b) Bonus. At the beginning of each calendar year during the Employment Period
in connection with the Board’s approval of the Company’s annual plan for that calendar year,
the Board shall establish and communicate to Employee performance criteria for the Company
and/or Employee and one or more objective formula(s) for determining Employee’s bonus
payment (the “Bonus”) for that calendar year. The performance criteria and objective
formulas for the 2010 calendar year are set forth in Exhibit A hereto. If Employee is
employed by the Corporation on the last day of the applicable calendar year, Employee will
be entitled to receive a Bonus in an amount determined in accordance with such objective
formula(s) set by the Board based on the actual performance of the Company and/or Employee
relative to the performance criteria established by the Board for that year. The formulas
shall include an aggregate “Target Bonus” for any given calendar year equal to fifty-nine
percent (59%) of Employee’s Salary in effect at the beginning of that calendar year. Any
Bonus due to Employee pursuant to this Section 2.4(b) shall be paid in cash in a lump sum
within 15 calendar days after the completion of the year-end audited financial statements
for the applicable calendar year, and in no event later than March 14 of the calendar year
following the applicable calendar year. 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.

	2.	 	Exhibit A of the Agreement shall be amended and restated in its entirety effective January 1,
2010 to read as follows:

 

 

Exhibit A

Performance Targets and Bonus Formulas for Calendar Year 2010

     This Exhibit A sets forth the performance targets and formulas for calculating
Employee’s calendar year 2010 Bonus if Employee remains employed by the Corporation on the
last day of calendar year 2010. The 2010 Bonus is divided into five components. Each
component is subject to satisfaction of its own financial test set forth below. The total
Bonus may include all, some, one or none of the components depending on whether the
financial tests for the different components are met for calendar year 2010:

     (i) If the Corporation’s Net Income From Operations for calendar year 2010 is (A) equal
to or greater than 90% but less than 100% of the Target Net Income From Operations for 2010,
Employee will be entitled to a Bonus equal to 30% of the Target Bonus multiplied by a
fraction, the numerator of which is equal to the Corporation’s Net Income From Operations
for 2010 expressed as a percentage of the Target Net Income From Operations for 2010 minus
90%, and the denominator of which is equal to 10%; and (B) equal to or greater than 100% of
the Target Net Income From Operations for 2010, Employee will be entitled to a Bonus equal
to 30% of the Target Bonus multiplied a fraction, the numerator of which is equal to the
Corporation’s Net Income From Operations for 2010 expressed as a percentage of the Target
Net Income From Operations for 2010, and the denominator of which is equal to 100%;
provided, however, that the award earned on account of the Corporation’s Net Income From
Operations shall not exceed 33% of the Target Bonus;

     (ii) If the Corporation’s average monthly Net Finance Receivables for the year ending
December 31, 2010 are equal to or greater than 100% of the Target Net Finance Receivables,
Employee will be entitled to a Bonus equal to 13.3% of the Target Bonus multiplied a
fraction, the numerator of which is equal to the Corporation’s Net Finance Receivables for
2010 expressed as a percentage of the Target Net Finance Receivables for 2010, and the
denominator of which is equal to 100%; provided, however, that the award earned on account
of the Corporation’s Net Finance Receivables shall not exceed 14.63% of the Target Bonus;

     (iii) If the Corporation’s Total General and Administrative Expense Percentage for
calendar year 2010 is equal to or less than 100% of the Target Total General and
Administrative Expense Percentage for 2010, Employee will be entitled to a Bonus equal to
13.3% of the Target Bonus multiplied by the sum of one and the difference between 100% and
the Corporation’s Total General and Administrative Expense Percentage for 2010 expressed as
a percentage of the Target Total General and Administrative Expense Percentage for 2010;
provided, however, that the award earned on account of the Corporation’s Total General and
Administrative Expense Percentage shall not exceed 14.63% of the Target Bonus;

     (iv) If the Corporation’s Net Loans Charged Off for calendar year 2010 are equal to or
less than 100% of the Target Net Loans Charged Off for 2010, Employee will

2

 

be entitled to a Bonus equal to 13.3% of the Target Bonus multiplied by the sum of one
and the difference between 100% and the Corporation’s Net Loans Charged Off for 2010
expressed as a percentage of the Target Net Loans Charged Off for 2010; provided, however,
that the award earned on account of the Corporation’s Net Loans Charged Off shall not exceed
14.63% of the Target Bonus; and

     (v) If the Corporation’s Total Debt/EBITDA for calendar year 2010 is (A) greater than
100% of the Target Total Debt/EBITDA for 2010 but less than 110% of the Target Total
Debt/EBITDA for 2010, Employee will be entitled to a Bonus equal to 30% of the Target Bonus
multiplied by a fraction, the numerator of which is equal to the difference between 110% and
the Corporation’s Total Debt/EBITDA for 2010 expressed as a percentage of the Target Total
Debt/EBITDA for 2010 and the denominator of which is equal to 10%; and (B) if the
Corporation’s Total Debt/EBITDA for calendar year 2010 is equal to or less than 100% of the
Target Total Debt/EBITDA for 2010, Employee will be entitled to a Bonus equal to 30% of the
Target Bonus multiplied by the sum) of one and the difference between 100% and the
Corporation’s Total Debt/EBITDA for 2010 expressed as a percentage of the Target Total
Debt/EBITDA for 2010; provided, however, that the award earned on account of the
Corporation’s Total Debt/EBITDA shall not exceed 33% of the Target Bonus.

     Capitalized terms used in this Exhibit A and not defined elsewhere in the Agreement
have the definitions set forth below.

(a) “Consolidated”: as it applies to the Corporation, the Corporation and its Subsidiaries
on a consolidated basis in accordance with GAAP, after eliminating all intercompany items.

(b) “GAAP”: generally accepted accounting principles in effect from time to time in the
United States of America, applied on a consistent basis. All amounts determined in
accordance with GAAP shall be reviewed by the Corporation’s outside CPA firm.

(c) “Net Finance Receivables”: at any date, the Consolidated net finance receivables of the
Corporation (prior to any allowance for loan losses and net of unearned interest and fees),
determined in accordance with GAAP.

(d) “Net Income From Operations”: for any period, the Consolidated net income from
operations of the Corporation, determined in accordance with GAAP.

(e) “Net Loans Charged Off”: for any period, the Consolidated aggregate amount of loans
charged off net of recoveries (prior to allowances and net of unearned interest and fees) of
the Corporation, determined in accordance with GAAP.

(f) “Plan” means the 2010 Annual Plan for the Corporation approved by the
Board at its January 18, 2010 meeting.

(g) “Target Net Finance Receivables”: the target amount of average Net Finance Receivables
for the year ending December 31, 2010 set forth in the Plan by the Board ($214,115 for
2010).

3

 

(h) “Target Net Income From Operations”: the target amount of Net Income From Operations
for calendar year 2010 set forth in the Plan by the Board ($15,151 for 2010).

(i) “Target Net Loans Charged Off”: the target amount of Net Loans Charged Off for calendar
year 2010 set forth in the Plan by the Board (8.5% for 2010).

(j) “Target Total Debt/EBITDA”: the target amount of Total Debt/EBITDA for calendar year
2010 set forth in the Plan by the Board (5.7x for 2010).

(k) “Target Total General and Administrative Expense Percentage”: the target Total General
and Administrative Expense Percentage for calendar year 2010 set forth in the Plan by the
Board (41.7% of total revenue, based on plan revenues of $81.927 for 2010).

(l) “Total Debt/EBITDA”: for any period, the ratio of the total debt of the Corporation
(representing the average senior debt for the year plus the ending balance of other
outstanding net debt at the end of year) to the Corporation’s earnings before interest,
taxes, depreciation and amortization, each determined in accordance with GAAP.

(m) “Total General and Administrative Expense Percentage”: for any period, the Consolidated
total general and administrative operating expenses of the Corporation divided by the total
revenue of the Corporation, in each case determined in accordance with GAAP) and expressed
as a percentage.

     Illustration: Solely for purposes of illustrating the calculation of the Bonus
contemplated in this Exhibit A, if the Company’s (i) Net Income From Operations for calendar
year 2010 is 98% of Target Net Income From Operations for that year, (ii) Net Finance
Receivables for the year ending December 31, 2010 arc 102% of Target Net Finance Receivables
for that year, (iii) the Total General and Administrative Expense Percentage for calendar
year 2010 is 88% of the Target Total General and Administrative Expense Percentage for that
year, (iv) Net Loans Charged Off for calendar year 2010 are 102% of Target Net Loans Charged
Off for that year, and (v) Total Debt/EBITDA for calendar year 2010 is 98% of Target Total
Debt/EBITDA, then the Bonus would be (24% + 13.57% + 14.63% + 0% + 30.6%) of $206,500 or
$170,982.

	3.	 	The parties hereby agree that the Agreement will continue to be in full force and effect as
modified by the terms of this Amendment.

4

 

     IN WITNESS WHEREOF, the parties have executed this Amendment as of the day and year first
above written.

	 	 	 	 	 	 	 

	 	 	EMPLOYEE:	 	 
	 
	 	 	 	 	 	 
	 	 	/s/ Thomas F Fortin	 	 
	 	 	 	 	 
	 	 	THOMAS F. FORTIN	 	 
	 
	 	 	 	 	 	 
	 	 	CORPORATION:	 	 
	 
	 	 	 	 	 	 
	 	 	REGIONAL MANAGEMENT CORP.	 	 
	 
	 	 	 	 	 	 
	 

	 	By:	 	/s/ Robert D. Barry 	 	 
	 

	 	 	 	 

	 	 
	 
	 	 	 	 	 	 
	 

	 	Title:	 	EVP/CFO 	 	 
	 

	 	 	 	 

	 	 

5

 

FOURTH AMENDMENT TO

EMPLOYMENT AGREEMENT

BETWEEN

REGIONAL MANAGEMENT CORP. AND THOMAS F. FORTIN

     This
Fourth Amendment to Employment Agreement
(“Amendment”) is made and entered into this
17th day of May, 2011, by and between Thomas F. Fortin (“Employee”) and Regional Management Corp., a
South Carolina corporation (“Corporation”).

W I T N E S S E T H

     WHEREAS, the Employee and the Corporation entered into an Employment Agreement dated February
29, 2008, as amended (“Agreement”); and

     WHEREAS, the Employee and the Corporation desire to amend the Agreement effective January 1,
2011.

     NOW, THEREFORE, in consideration of the premises and mutual covenants and agreements contained
herein and other good and valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties hereto agree as follows:

	1.	 	Section 2.4(b) of the Agreement shall be amended and restated in its entirety effective
January 1, 2011 to read as follows:

     (b) Bonus. At the beginning of each calendar year during the Employment Period
in connection with the Board’s approval of the Company’s annual plan for that calendar year,
the Board shall establish and communicate to Employee performance criteria for the Company
and/or Employee and one or more objective formula(s) for determining Employee’s bonus
payment (the “Bonus”) for that calendar year. The performance criteria and objective
formulas for the 2011 calendar year are set forth in Exhibit A hereto. If Employee is
employed by the Corporation on the last day of the applicable calendar year, Employee will
be entitled to receive a Bonus in an amount determined in accordance with such objective
formula(s) set by the Board based on the actual performance of the Company and/or Employee
relative to the performance criteria established by the Board for that year. The formulas
shall include an aggregate “Target Bonus” for any given calendar year equal to fifty-nine
percent (59%) of Employee’s Salary in effect at the beginning of that calendar year. Any
Bonus due to Employee pursuant to this Section 2.4(b) shall be paid in cash in a lump sum
within 15 calendar days after the completion of the year-end audited financial statements
for the applicable calendar year, and in no event later than March 14 of the calendar year
following the applicable calendar year. 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.

	2.	 	Exhibit A of the Agreement shall be amended and restated in its entirety effective January L
2011 to read as follows:

 

 

Exhibit A

Performance Targets and Bonus Formulas for Calendar Year 2011

     This Exhibit A sets forth the performance targets and formulas for calculating
Employee’s calendar year 2011 Bonus if Employee remains employed by the Corporation on the
last day of calendar year 2011. The 2011 Bonus is divided into five components. Each
component is subject to satisfaction of its own financial test set forth below. The total
Bonus may include all, some, one or none of the components depending on whether the
financial tests for the different components arc met for calendar year 2011:

     (i) If the Corporation’s Net Income From Operations for calendar year 2011 is (A) equal
to or greater than 90% but less than 100% of the Target Net Income From Operations for 2011,
Employee will be entitled to a Bonus equal to 30% of the Target Bonus multiplied by a
fraction, the numerator of which is equal to the Corporation’s Net Income From Operations
for 2011 expressed as a percentage of the Target Net Income From Operations for 2011 minus
90%, and the denominator of which is equal to 10%; and (B) equal to or greater than 100% of
the Target Net Income From Operations for 2011, Employee will be entitled to a Bonus equal
to 30% of the Target Bonus multiplied a fraction, the numerator of which is equal to the
Corporation’s Net Income From Operations for 2011 expressed as a percentage of the Target
Net Income From Operations for 2011, and the denominator of which is equal to 100%;
provided, however, that the award earned on account of the Corporation’s Net Income From
Operations shall not exceed 33% of the Target Bonus;

     (ii) If the Corporation’s average monthly Net Finance Receivables for the year ending
December 31, 2011 are equal to or greater than 100% of the Target Net Finance Receivables,
Employee will be entitled to a Bonus equal to 13.3% of the Target Bonus multiplied a
fraction, the numerator of which is equal to the Corporation’s Net Finance Receivables for
2011 expressed as a percentage of the Target Net Finance Receivables for 2011, and the
denominator of which is equal to 100%; provided, however, that the award earned on account
of the Corporation’s Net Finance Receivables shall not exceed 14.63% of the Target Bonus;

     (iii) If the Corporation’s Total General and Administrative Expense Percentage for
calendar year 2011 is equal to or less than 100% of the Target Total General and
Administrative Expense Percentage for 2011, Employee will be entitled to a Bonus equal to
13.3% of the Target Bonus multiplied by the sum of one and the difference between 100% and
the Corporation’s Total General and Administrative Expense Percentage for 2011 expressed as
a percentage of the Target Total General and Administrative Expense Percentage for 2011;
provided, however, that the award earned on account of the Corporation’s Total General and
Administrative Expense Percentage shall not exceed 14.63% of the Target Bonus;

     (iv) If the Corporation’s Net Loans Charged Off for calendar year 2011 are equal to or
less than 100% of the Target Net Loans Charged Off for 2011, Employee will

2

 

be entitled to a Bonus equal to 13.3% of the Target Bonus multiplied by the sum of one
and the difference between 100% and the Corporation’s Net Loans Charged Off for 2011
expressed as a percentage of the Target Net Loans Charged Off for 2011; provided, however,
that the award earned on account of the Corporation’s Net Loans Charged Off shall not exceed
14.63% of the Target Bonus; and

     (v) If the Corporation’s Total Debt/EBITDA for calendar year 2011 is (A) greater than
100% of the Target Total Debt/EBITDA for 2011 but less than 110% of the Target Total
Debt/EBITDA for 2011, Employee will be entitled to a Bonus equal to 30% of the Target Bonus
multiplied by a fraction, the numerator of which is equal to the difference between 110% and
the Corporation’s Total Debt/EBITDA for 2011 expressed as a percentage of the Target Total
Debt/EBITDA for 2011 and the denominator of which is equal to 10%; and (B) if the
Corporation’s Total Debt/EBITDA for calendar year 2011 is equal to or less than 100% of the
Target Total Debt/EBITDA for 2011, Employee will be entitled to a Bonus equal to 30% of the
Target Bonus multiplied by the sum of one and the difference between 100% and the
Corporation’s Total Debt/EBITDA for 2011 expressed as a percentage of the Target Total
Debt/EBITDA for 2011; provided, however, that the award earned on account of the
Corporation’s Total Debt/EBITDA shall not exceed 33% of the Target Bonus.

     Capitalized terms used in this Exhibit A and not defined elsewhere in the Agreement
have the definitions set forth below.

(a) “Consolidated”: as it applies to the Corporation, the Corporation and its Subsidiaries
on a consolidated basis in accordance with GAAP, after eliminating all intercompany items.

(b) “GAAP”: generally accepted accounting principles in effect from time to time in the
United States of America, applied on a consistent basis. All amounts determined in
accordance with GAAP shall be reviewed by the Corporation’s outside CPA firm.

(c) “Net Finance Receivables”: at any date, the Consolidated net finance receivables of the
Corporation (prior to any allowance for loan losses and net of unearned interest and fees),
determined in accordance with GAAP.

(d) “Net Income From Operations”: for any period, the Consolidated net income from
operations of the Corporation, determined in accordance with GAAP.

(e) “Net Loans Charged Off”: for any period, the Consolidated aggregate amount of loans
charged off net of recoveries (prior to allowances and net of unearned interest and fees) of
the Corporation, determined in accordance with GAAP.

(f) “Plan” means the 2011 Annual Plan for the Corporation approved by the Board at its
December 22, 2010 meeting.

(g) “Target Net Finance Receivables”: the target amount of average Net Finance Receivables
for the year ending December 31, 2011 set forth in the Plan by the Board ($248,796,000 for
2011).

3

 

(h) “Target Net Income From Operations”: the target amount of Net Income From Operations for
calendar year 2011 set forth in the Plan by the Board ($22,188,000 for 2011).

(i) “Target Net Loans charged Off”: the target amount of Net Loans Charged Off for calendar
year 2011 set forth in the Plan by the Board (7.67% for 2011).

(j) “Target Total Debt/EBITDA”: the target amount of Total Debt/EBITDA for calendar year
2011 set forth in the Plan by the Board (4.2x for 2011).

(k) “Target Total General and Administrative Expense Percentage”: the target Total General
and Administrative Expense Percentage for calendar year 2011 set forth in the Plan by the
Board (38.2% of total revenue, based on plan revenues of $98,241,000 for 2011).

(l) “Total Debt/EBITDA”: for any period, the ratio of the total debt of the Corporation
(representing the average senior debt for the year plus the ending balance of other
outstanding net debt at the end of year) to the Corporation’s earnings before interest,
taxes, depreciation and amortization, each determined in accordance with GAAP.

(m) “Total General and Administrative Expense Percentage”: for any period, the Consolidated
total general and administrative operating expenses of the Corporation divided by the total
revenue of the Corporation, in each case determined in accordance with GAAP and expressed as
a percentage.

     Illustration: Solely for purposes of illustrating the calculation of the Bonus
contemplated in this Exhibit A, if the Company’s (i) Net Income From Operations for calendar
year 2011 is 98% of Target Net Income From Operations for that year, (ii) Net Finance
Receivables for the year ending December 31, 2011 are 102% of Target Net Finance Receivables
for that year, (iii) the Total General and Administrative Expense Percentage for calendar
year 2011 is 88% of the Target Total General and Administrative Expense Percentage for that
year, (iv) Net Loans Charged Off for calendar year 2011 are 102% of Target Net Loans Charged
Off for that year, and (v) Total Debt/EBITDA for calendar year 2011 is 98% of Target Total
Debt/EBITDA, then the Bonus would be (24% + 13.57% + 14.63% + 0% + 30.6%) of $206,500 or
$170,982.

	3.	 	The parties hereby agree that the Agreement will continue to be in full force and effect as
modified by the terms of this Amendment.

4

 

     IN WITNESS WHEREOF, the parties have executed this Amendment as of the day and year first
above written.

	 	 	 	 	 	 	 

	 	 	EMPLOYEE:	 	 
	 
	 	 	 	 	 	 
	 	 	/s/ Thomas F. Fortin	 	 
	 	 	 	 	 
	 	 	THOMAS F. FORTIN	 	 
	 
	 	 	 	 	 	 
	 	 	CORPORATION:	 	 
	 
	 	 	 	 	 	 
	 	 	REGIONAL MANAGEMENT CORP.	 	 
	 
	 	 	 	 	 	 
	 

	 	By:	 	/s/ Robert D. Barry	 	 
	 

	 	 	 	 

	 	 
	 

	 	Title:	 	EVP/CFO	 	 
	 

	 	 	 	 

	 	 

5exv10w13

Exhibit 10.13

July 1, 2008

Mr. Robert D. Barry

7516 Wingfoot Drive

Raleigh, NC 27615

Dear Bob:

It is with great pleasure that we offer you this revised offer of employment as a member of
Regional Management Corp.’s executive management team (“RMC” or “the Corporation” or the Company”).
Upon execution, this letter shall supersede your current employment letter with Regional Holdings,
LLC.

Your position will continue to be Executive Vice President and Chief Financial Officer (“CFO”) of
RMC. In this position, you will continue report to the CEO of the Corporation and lead all
accounting, finance and information technology functions including business/financial data
analysis, reporting, banking and lender relations, acquisition review; oversee certain compliance
functions of the Corporation; and interact directly with the principals of Palladium and Parallel.
Your priorities for 2008 and beyond will center on controls and financial reporting. This letter
serves as a formal offer of the terms of employment.

Base Salary:

Your annual base salary will be $225,000.00, retroactive to January 1, 2008 and subject to annual
review at year end along with the rest of the management team.

Bonus:

You will be eligible for 67% of your annual salary in an annual discretionary bonus program each
fiscal year and will be determined as follows:

	 	(a)	 	Up to 50% of your prevailing base salary may be earned based on a “four-prong”
test of financial performance. This test will utilize the criteria, weightings and
methodology as set forth on Exhibit A, which is attached to this letter and
incorporated herein by reference.
	 
	 	(b)	 	Up to 17% of your prevailing base salary may be earned based on your
achievement of the stated objectives for the CFO established by the Board. The Company,
with input from the Board, will prepare a set of written objectives and goals for 2008
shortly and may update and/or revise such goals from time to time as appropriate and in
good faith.

Stock Options:

Shortly after the execution of this letter, you will receive an additional stock option grant to
increase your options percentage from 0.75% to 1.00% of RMC stock (taking into account as
outstanding the unallocated shares reserved in the management incentive plan) in accordance with
the Corporation’s Management Incentive Plan. The options will vest on the same basis as outlined in
the Plan starting on the date of the grant. The amount of options will also be subject to annual
review.

 

 

Benefits:

You will continue to be entitled to participate in all 401(k) pension, medical and other benefit
plans and programs generally available to the Corporation’s other employees including medical,
dental, and vision, life insurance, AD&D, LTD, and other programs.

Vacation:

You will continue accruing vacation at the rate of four weeks per year. You shall also be entitled
to all paid holidays and to reasonable sick leave in accordance with the policies of the
Corporation applicable to its executive management. You will also be eligible for up to 40 paid
hours per year for continuing education courses required in order to maintain your CPA certificates
and to be also licensed in SC should we agree that you obtain that certification.

Expenses:

RMC will continue to pay or reimburse you for all reasonable business expenses incurred in
connection with the performance of your duties or for promoting, pursuing or otherwise furthering
the business of RMC, including your reasonable expenses for travel, entertainment and similar
items.

The Corporation will also continue to provide you a monthly car allowance and a monthly cellular
phone allowance in accordance with RMC’s policies for executive management.

Severance:

This offer will in no way constitute a contract of employment, actual or implied. Employment with
RMC will be “at-will” and in no way guaranteed. However, if you are terminated by the Company
without cause, you will be entitled to receive six months of your prevailing base salary as
severance.

We have very Much enjoyed your valuable contributions to date and continue to be very excited about
the Company’s future. We look forward to continue working with you and the contributions you’re
sure to bring. Please indicate your acceptance of this offer by signing below.

Sincerely,

/s/ Thomas F. Fortin

Thomas F. Fortin

CEO

Regional Management Corporation

	 	 	 	 	 

	Accepted
by:

	 	Date:	 	 
	/s/ Robert D. Barry 
	 	7/18/08	 	 
	 

	 	 

	 	 

	 	 	 

	Cc:

	 	David Perez, Ellery Roberts

 

 

Exhibit A

Performance Targets and Bonus Formulas for Calendar Year 2008

This Exhibit A sets forth certain performance targets and formulas for calculating the calendar
year 2008 bonus if the employee remains employed by the Corporation on the last day of calendar
year 2008. The 2008 bonus formula is divided into four components. Each component is subject to
satisfaction of its own financial test set forth below. The total bonus may include all, some, one
or none of the components depending on whether the financial tests for the different components are
met for calendar year 2008:

          (i) If the Corporation’s Net Income for calendar year 2008 is equal to or greater than 100% of
the Target Net Income for 2008, employee will be entitled to a bonus equal to 30% of the Target
Bonus;

          (ii) If the Corporation’s average monthly Net Finance Receivables for the year ending December
31, 2008 are equal to or greater than 100% of the Target Net Finance Receivables, employee will be
entitled to a bonus equal to 30% of the Target Bonus:

          (iii) If the Corporation’s Total General and Administrative Expense Percentage for calendar
year 2008 is equal to or less than the Target Total General and Administrative Expense Percentage
for 2008, employee will be entitled to a bonus equal to 20% of the Target Bonus; and

          (iv) If the Corporation’s Loans Charged Off for calendar year 2008 are equal to or less than
the Target Loans Charged Off for 2008, employee will be entitled to a bonus equal to 20% of the
Target Bonus.

          Capitalized terms used in this Exhibit A have the definitions set forth below.

          (a) “Consolidated” as it applies to the Corporation, the Corporation and its Subsidiaries on a
consolidated basis in accordance with GAAP, after eliminating all intercompany items.

          (b) “GAAP”: generally accepted accounting principles in effect from time to time in the United
States of America, applied on a consistent basis.

          (c) “Loans Charged Off”: for any period, the Consolidated aggregate amount of loans charged
off (including principal and interest) of the Corporation, determined in accordance with GAAP.

          (d) “Net Income”: for any period, the Consolidated net income of the Corporation, determined
in accordance with GAAP.

          (e) “Net Finance Receivables”: at any date, the Consolidated net finance receivables of the
Corporation (prior to any allowance for loan losses), determined in accordance with GAAP.

 

 

          (f) “Plan” means the 2008 Annual Plan for the Corporation approved by the Board at its January
9, 2008 meeting.

          (g) “Target Bonus”: for any given calendar year, means an amount equal to fifty percent (50%)
of the employee’s salary in effect at the beginning of that calendar year.

          (h) “Target Loans Charged Off”: the target amount of Loans Charged Off for calendar year 2008
set forth in the Plan by the Board (6.6% for 2008).

          (i) “Target Net Income”: the target amount of Net Income for calendar year 2008 set forth in
the Plan by the Board ($9,000,000 for 2008).

          (j) “Target Net Finance Receivables”: the target amount of average Net Finance Receivables for
the year ending December 31, 2008 set forth in the Plan by the Board ($163,900,000 for 2008).

          (k) “Target Total General and Administrative Expense Percentage”: the target Total General and
Administrative Expense Percentage for calendar year 2008 set forth in the Plan by the Board (43.5%
of total income, based on a plan of $27,392,000 for 2008).

          (l) “Total General and Administrative Expense Percentage”: for any period, the Consolidated
total general and administrative operating expenses of the Corporation divided by the total income
of the Corporation, in each case determined in accordance with GAAP and expressed as a percentage.

     Illustration: Solely for purposes of illustrating the calculation of the bonus contemplated in
this Exhibit A, if the Company’s (i) Net Income for calendar year 2008 is 98% of Target Net Income
for that year, (ii) Net Finance Receivables for the year ending December 31, 2008 are 102% of
Target Net Finance Receivables for that year, (iii) the Total General and Administrative Expense
Percentage for calendar year 2008 is 88% of the Target Total General and Administrative Expense
Percentage for that year, and (iv) Loans Charged Off for calendar year 2008 are 102% of Target
Loans Charged Off for that year, then the bonus Would be (0%+30% + F 20% + 0%) of 50% of $225,000
or $56,250.

 

 

LETTER AGREEMENT

BETWEEN

REGIONAL MANAGEMENT CORP. AND ROBERT D. BARRY

     This
Letter Agreement (“Agreement”) is made and entered into
this 13th day of April, 2010,
by and between Robert D. Barry (“Employee”) and Regional Management Corp., a South Carolina
corporation (“Corporation”).

W I T N E S S E T H

     WHEREAS, the Employee and the Corporation entered into a Letter Agreement dated July 1, 2008,
as amended (“Prior Agreement”); and

     WHEREAS, the Employee and the Corporation desire to amend the Prior Agreement effective
January 1, 2010.

     NOW, THEREFORE, in consideration of the premises and mutual covenants and agreements contained
herein and other good and valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties hereto agree as follows:

	1.	 	The section of the Prior Agreement entitled “Bonus” shall be amended and restated in its
entirety effective January 1, 2010 to read as follows:

     You will be eligible to receive up to seventy-four and one half percent (74.5%) of your
prevailing base salary each fiscal year under an annual discretionary bonus program based on a
“five-prong” test of financial performance. This test will utilize the criteria, weightings and
methodology as set forth on Exhibit A, which is attached to the Agreement and incorporated herein
by reference.

	2.	 	Exhibit A of the Prior Agreement shall be amended and restated in its entirety effective
January 1, 2010 to read as follows:

Exhibit A

Performance Targets and Bonus Formulas for Calendar Year 2010

     This Exhibit A sets forth the performance targets and formulas for calculating
Employee’s calendar year 2010 Bonus if Employee remains employed by the Corporation on the
last day of calendar year 2010. The 2010 Bonus is divided into five components. Each
component is subject to satisfaction of its own financial test set forth below. The total
Bonus may include all, some, one or none of the components depending on whether the
financial tests for the different components are met for calendar year 2010:

     (i) If the Corporation’s Net Income From Operations for calendar year 2010 is (A) equal
to or greater than 90% but less than 100% of the Target Net Income From Operations for 2010,
Employee will be entitled to a Bonus equal to 30% of the Target Bonus multiplied by a
fraction, the numerator of which is equal to the Corporation’s Net

 

 

Income From Operations for 2010 expressed as a percentage of the Target Net Income From
Operations for 2010 minus 90%, and the denominator of which is equal to 10%; and (B) equal
to or greater than 100% of the Target Net Income From Operations for 2010, Employee will be
entitled to a Bonus equal to 30% of the Target Bonus multiplied a fraction, the numerator of
which is equal to the Corporation’s Net Income From Operations for 2010 expressed as a
percentage of the Target Net Income From Operations for 2010, and the denominator of which
is equal to 100%; provided, however, that the award earned on account of the Corporation’s
Net Income From Operations shall not exceed 33% of the Target Bonus;

     (ii) If the Corporation’s average monthly Net Finance Receivables for the year ending
December 31, 2010 are equal to or greater than 100% of the Target Not Finance Receivables,
Employee will be entitled to a Bonus equal to 13.3% of the Target Bonus multiplied a
fraction, the numerator of which is equal to the Corporation’s Net Finance Receivables for
2010 expressed as a percentage of the Target Net Finance Receivables for 2010, and the
denominator of which is equal to 100%; provided, however, that the award earned on account
of the Corporation’s Net Finance Receivables shall not exceed 14.63% of the Target Bonus;

     (iii) If the Corporation’s Total General and Administrative Expense Percentage for
calendar year 2010 is equal to or less than 100% of the Target Total General and
Administrative Expense Percentage for 2010, Employee will be entitled to a Bonus equal to
13.3% of the Target Bonus multiplied by the sum of one and the difference between 100% and
the Corporation’s Total General and Administrative Expense Percentage for 2010 expressed as
a percentage of the Target Total General and Administrative Expense Percentage for 2010;
provided, however, that the award earned on account of the Corporation’s Total General and
Administrative Expense Percentage shall not exceed 14.63% of the Target Bonus;

     (iv) If the Corporation’s Net Loans Charged Off for calendar year 2010 are equal to or
less than 100% of the Target Net Loans Charged Off for 2010, Employee will be entitled to a
Bonus equal to 13.3% of the Target Bonus multiplied by the sum of one and the difference
between 100% and the Corporation’s Net Loans Charged Off for 2010 expressed as a percentage
of the Target Net Loans Charged Off for 2010; provided, however, that the award earned on
account of the Corporation’s Net Loans Charged Off shall not exceed 14.63% of the Target
Bonus; and

     (v) If the Corporation’s Total Debt/EBITDA for calendar year 2010 is (A) greater than
100% of the Target Total Debt/EBITDA for 2010 but less than 110% of the Target Total
Debt/EBITDA for 2010, Employee will be entitled to a Bonus equal to 30% of the Target Bonus
multiplied by a fraction, the numerator of which is equal to the difference between 110% and
the Corporation’s Total Debt/EBITDA for 2010 expressed as a percentage of the Target Total
Debt/EBITDA for 2010 and the denominator of which is equal to 10%; and (B) if the
Corporation’s Total Debt/EBITDA for calendar year 2010 is equal to or less than 100% of the
Target Total Debt/EBITDA for 2010, Employee will be entitled to a Bonus equal to 30% of the
Target Bonus multiplied by the sum of one and the difference between 100% and the
Corporation’s Total Debt/EBITDA for 2010

 

 

expressed as a percentage of the Target Total Debt/EBITDA for 2010; provided, however,
that the award earned on account of the Corporation’s Total Dcbt/EBITDA shall not exceed 33%
of the Target Bonus.

     Capitalized terms used in this Exhibit A and not defined elsewhere in the Agreement
have the definitions set forth below.

     (a) “Consolidated”: as it applies to the Corporation, the Corporation and its
Subsidiaries on a consolidated basis in accordance with GAAP, after eliminating all
intercompany items.

     (b) “GAAP”: generally accepted accounting principles in effect from time to time in the
United States of America, applied on a consistent basis. All amounts determined in
accordance with GAAP shall be reviewed by the Corporation’s outside CPA firm.

     (c) “Net Finance Receivables”: at any date, the Consolidated net finance receivables of
the Corporation (prior to any allowance for loan losses and net of unearned interest and
fees), determined in accordance with GAAP.

     (d) “Net Income From Operations”: for any period, the Consolidated net income from
operations of the Corporation, determined in accordance with GAAP.

     (e) “Net Loans Charged Off”: for any period, the Consolidated aggregate amount of loans
charged off net of recoveries (prior to allowances and net of unearned interest and fees) of
the Corporation, determined in accordance with GAAP.

     (f) “Plan” means the 2010 Annual Plan for the Corporation approved by the Board at its
January 18, 2010 meeting.

     (g) “Target Net Finance Receivables”: the target amount of average Net Finance
Receivables for the year ending December 31, 2010 set forth in the Plan by the Board
($214,115 for 2010).

     (h) “Target Net Income From Operations”: the target amount of Net Income From
Operations for calendar year 2010 set forth in the Plan by the Board ($15,151 for 2010).

     (i) “Target Net Loans Charged Off”: the target amount of Net Loans Charged Off for
calendar year 2010 set forth in the Plan by the Board (8.5% for 2010).

     (j) “Target Total Debt/EBITDA”: the target amount of Total Debt/EBITDA for calendar
year 2010 set forth in the Plan by the Board (5.7x for 2010).

     (k) “Target Total General and Administrative Expense Percentage”: the target Total
General and Administrative Expense Percentage for calendar year 2010 set forth in the Plan
by the Board (41.7% of total revenue, based on plan revenues of $81,927 for 2010).

 

 

     (l) “Total Debt/EBITDA”: for any period, the ratio of the total debt of the Corporation
(representing the average senior debt for the year plus the ending balance of other
outstanding net debt at the end of year) to the Corporation’s earnings before interest,
taxes, depreciation and amortization, each determined in accordance with GAAP.

     (m) “Total General and Administrative Expense Percentage”: for any period, the
Consolidated total general and administrative operating expenses of the Corporation divided
by the total revenue of the Corporation, in each case determined in accordance with GAAP and
expressed as a percentage.

     Illustration: Solely for purposes of illustrating the calculation of the Bonus
contemplated in this Exhibit A, if the Company’s (i) Net Income From Operations for calendar
year 2010 is 98% of Target Net Income From Operations for that year, (ii) Net Finance
Receivables for the year ending December 31, 2010 are 102% of Target Net Finance Receivables
for that year, (iii) the Total General and Administrative Expense Percentage for calendar
year 2010 is 88% of the Target Total General and Administrative Expense Percentage for that
year, (iv) Net Loans Charged Off for calendar year 2010 are 102% of Target Net Loans Charged
Off for that year, and (v) Total Debt/EBITDA for calendar year 2010 is 98% of Target Total
Debt/EBITDA, then the Bonus would be (24% + 13.57% + 14.63% + 0% + 30.6%) of $167,625 or
$138,793.50.

	3.	 	The parties hereby agree that the Prior Agreement will continue to be in full force and
effect as modified by the terms of this Agreement,

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

	 	 	 	 	 	 	 

	 	 	EMPLOYEE:	 	 
	 
	 	/s/ Robert D. Barry	 	 
	 	 	 	 	 
	 	 	ROBERT D. BARRY	 	 
	 
	 	 	 	 	 	 
	 	 	CORPORATION:	 	 
	 
	 	 	 	 	 	 
	 	 	REGIONAL MANAGEMENT CORP.	 	 
	 
	 	 	 	 	 	 
	 

	 	By:	 	/s/ Thomas F. Fortin 	 	 
	 

	 	 	 	 

	 	 
	 

	 	Title:
	 	CEO 	 	 
	 

	 	 	 	 

	 	 

 

 

LETTER AGREEMENT

BETWEEN

REGIONAL MANAGEMENT CORP. AND ROBERT D. BARRY

This
Letter Agreement (“Agreement”) is made and entered into
this 17th day of May, 2011, by and
between Robert D. Barry (“Employee”) and Regional Management Corp., a South Carolina corporation
(“Corporation”).

W I T N E S S E T H

     WHEREAS, the Employee and the Corporation entered into a Letter Agreement dated July 1, 2008,
as amended (“Prior Agreement”); and

     WHEREAS, the Employee and the Corporation desire to amend the Prior Agreement effective
January 1, 2011.

     NOW, THEREFORE, in consideration of the premises and mutual covenants and agreements contained
herein and other good and valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties hereto agree as follows:

	1.	 	The section of the Prior Agreement entitled “Bonus” shall be amended and restated in its
entirety effective January 1, 2011 to read as follows:

     You will be eligible to receive up to seventy-four and one half percent (74.5%) of your
prevailing base salary each fiscal year under an annual discretionary bonus program based on a
“five-prong” test of financial performance. This test will utilize the criteria, weightings and
methodology as set forth on Exhibit A, which is attached to the Agreement and incorporated herein
by reference.

	2.	 	Exhibit A of the Prior Agreement shall be amended and restated in its entirety effective
January 1, 2011 to read as follows;

Exhibit A

Performance Targets and Bonus Formulas for Calendar Year 2011

     This Exhibit A sets forth the performance targets and formulas for calculating
Employee’s calendar year 2011 Bonus if Employee remains employed by the Corporation on the
last day of calendar year 2011. The 2011 Bonus is divided into five components. Each
component is subject to satisfaction of its own financial test set forth below. The total
Bonus may include all, some, one or none of the components depending on whether the
financial tests for the different components are met for calendar year 2011:

     (i) If the Corporation’s Net Income From Operations for calendar year 2011 is (A) equal
to or greater than 90% but less than 100% of the Target Net Income From Operations for 2011,
Employee will be entitled to a Bonus equal to 30% of the Target Bonus multiplied by a
fraction, the numerator of which is equal to the Corporation’s Net

 

 

Income From Operations for 2011 expressed as a percentage of the Target Net Income From
Operations for 2011 minus 90%, and the denominator of which is equal to 10%; and (B) equal
to or greater than 100% of the Target Net Income From Operations for 2011, Employee will be
entitled to a Bonus equal to 30% of the Target Bonus multiplied a fraction, the numerator of
which is equal to the Corporation’s Net Income From Operations for 2011 expressed as a
percentage of the Target Net Income From Operations for 2011, and the denominator of which
is equal to 100%; provided, however, that the award earned on account of the Corporation’s
Net Income From Operations shall not exceed 33% of the Target Bonus;

     (ii) If the Corporation’s average monthly Net Finance Receivables for the year ending
December 31, 2011 are equal to or greater than 100% of the Target Net Finance Receivables,
Employee will be entitled to a Bonus equal to 13.3% of the Target Bonus multiplied a
fraction, the numerator of which is equal to the Corporation’s Net Finance Receivables for
2011 expressed as a percentage of the Target Net Finance Receivables for 2011, and the
denominator of which is equal to 100%; provided, however, that the award earned on account
of the Corporation’s Net Finance Receivables shall not exceed 14.63% of the Target Bonus;

     (iii) If the Corporation’s Total General and Administrative Expense Percentage for
calendar year 2011 is equal to or less than 100% of the Target Total General and
Administrative Expense Percentage for 2011, Employee will be entitled to a Bonus equal to
13.3% of the Target Bonus multiplied by the sum of one and the difference between 100% and
the Corporation’s Total General and Administrative Expense Percentage for 2011 expressed as
a percentage of the Target Total General and Administrative Expense Percentage for 2011;
provided, however, that the award earned on account of the Corporation’s Total General and
Administrative Expense Percentage shall not exceed 14.63% of the Target Bonus;

     (iv) If the Corporation’s Net Loans Charged Off for calendar year 2011 are equal to or
less than 100% of the Target Net Loans Charged Off for 2011, Employee will be entitled to a
Bonus equal to 13.3% of the Target Bonus multiplied by the sum of one and the difference
between 100% and the Corporation’s Net Loans Charged Off for 2011 expressed as a percentage
of the Target Net Loans Charged Off for 2011; provided, however, that the award earned on
account of the Corporation’s Net Loans Charged Off shall not exceed 14.63% of the Target
Bonus; and

     (v) If the Corporation’s Total Debt/EBITDA for calendar year 2011 is (A) greater than
00% of the Target Total Debt/EBITDA for 2011 but less than 110% of the Target Total
Debt/EBITDA for 2011, Employee will be entitled to a Bonus equal to 30% of the Target Bonus
multiplied by a fraction, the numerator of which is equal to the difference between 110% and
the Corporation’s Total Debt/EBITDA for 2011 expressed as a percentage of the Target Total
Debt/EBITDA for 2011 and the denominator of which is equal to 10%; and (B) if the
Corporation’s Total Debt/EBITDA for calendar year 2011 is equal to or less than 100% of the
Target Total Debt/EBITDA lbr 2011, Employee will be entitled to a Bonus equal to 30% of the
Target Bonus multiplied by the sum of one and the difference between 100% and the
Corporation’s Total Debt/EBITDA for 2011

 

 

expressed as a percentage of the Target Total Debt/EBITDA for 2011; provided, however,
that the award earned on account of the Corporation’s Total Debt/EBITDA shall not exceed 33%
of the Target Bonus.

     Capitalized terms used in this Exhibit A and not defined elsewhere in the Agreement
have the definitions set forth below.

     (a) “Consolidated”: as it applies to the Corporation, the Corporation and its
Subsidiaries on a consolidated basis in accordance with GAAP, after eliminating all
intercompany items.

     (b) “GAAP”: generally accepted accounting principles in effect from time to time in the
United States of America, applied on a consistent basis. All amounts determined in
accordance with GAAP shall be reviewed by the Corporation’s outside CPA firm.

     (c) “Net Finance Receivables”: at any date, the Consolidated net finance receivables of
the Corporation (prior to any allowance for loan losses and net of unearned interest and
fees), determined in accordance with GAAP.

     (d) “Net Income From Operations”: for any period, the Consolidated net income from
operations of the Corporation, determined in accordance with GAAP.

     (e) “Net Loans Charged Off‘: for any period, the Consolidated aggregate amount of loans
charged off net of recoveries (prior to allowances and net of unearned interest and fees) of
the Corporation, determined in accordance with GAAP.

     (f) “Plan” means the 2011 Annual Plan for the Corporation approved by the Board at its
December 22, 2010 meeting.

     (g) “Target Net Finance Receivables”: the target amount of average Net Finance
Receivables for the year ending December 31, 2011 set forth in the Plan by the Board
($248,796,000 for 2011).

     (h) “Target Net Income From Operations”: the target amount of Net Income From
Operations for calendar year 2011 set forth in the Plan by the Board ($22,188,000 for 2011).

     (i) “Target Net Loans Charged Off‘: the target amount of Net Loans Charged Off for
calendar year 2011 set forth in the Plan by the Board (7.67% for 2011).

     (j) “Target Total Debt/EBITDA”: the target amount of Total Debt/EBITDA for calendar
year 2011 set forth in the Plan by the Board (4.2x for 2011).

     (k) “Target Total General and Administrative Expense Percentage”: the target Total
General and Administrative Expense Percentage for calendar year 2011 set forth in the Plan
by the Board (38.2% of total revenue, based on plan revenues of $98,241,000 for 2011).

 

 

     (l) “Total Debt/EBITDA”: for any period, the ratio of the total debt of the Corporation
(representing the average senior debt for the year plus the ending balance of other
outstanding net debt at the end of year) to the Corporation’s earnings before interest,
taxes, depreciation and amortization, each determined in accordance with GAAP.

     (m) “Total General and Administrative Expense Percentage”: for any period, the
Consolidated total general and administrative operating expenses of the Corporation divided
by the total revenue of the Corporation, in each case determined in accordance with GAAP and
expressed as a percentage.

     Illustration: Solely for purposes of illustrating the calculation of the Bonus
contemplated in this Exhibit A, if the Company’s (i) Net Income From Operations for calendar
year 2011 is 98% of Target Net Income From Operations for that year, (ii) Net Finance
Receivables for the year ending December 31, 2011 are 102% of Target Net Finance Receivables
for that year, (iii) the Total General and Administrative Expense Percentage for calendar
year 2011 is 88% of the Target Total General and Administrative Expense Percentage for that
year, (iv) Net Loans Charged Off for calendar year 2011 are 102% of Target Net Loans Charged
Off for that year, and (v) Total Debt/EBITDA for calendar year 2011 is 98% of Target Total
Debt/EBITDA, then the Bonus would be (24% + 13.57% ± 14.63% + 0% + 30.6%) of $167,625 or
$138,793.50.

	3.	 	The parties hereby agree that the Prior Agreement will continue to be in full force and
effect as modified by the terms of this Agreement.

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

	 	 	 	 	 	 	 

	 	 	EMPLOYEE:	 	 
	 
	 	/s/ Robert D. Barry	 	 
	 	 	 	 	 
	 	 	ROBERT D. BARRY	 	 
	 
	 	 	 	 	 	 
	 	 	CORPORATION:	 	 
	 
	 	 	 	 	 	 
	 	 	REGIONAL MANAGEMENT CORP.	 	 
	 
	 	 	 	 	 	 
	 

	 	By:
	 	 
/s/
Thomas F Fortin 

	 	 
	 
	 	 	 	 	 	 
	 

	 	Title:
	 	 
Chief
Executive Officer

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