Document:

Exhibit

FORM (3-Year Vesting)

PREFERRED APARTMENT COMMUNITIES, INC. 
2018 CLASS B UNIT  
AWARD AGREEMENT
This 2018 Class B Unit Award Agreement ("Agreement") made and entered into as of January 29, 2018, but effective as of the Effective Date, among Preferred Apartment Communities, Inc., a Maryland corporation (the "Company"), its subsidiary, Preferred Apartment Communities Operating Partnership, L.P., a Delaware limited partnership and the entity through which the Company conducts substantially all of its operations (the "Partnership"), and the person identified below as the grantee (the "Grantee").
Recitals
 
A.    Grantee is an [officer of the Company and provides services to the Partnership] [employee of an affiliate of the Company that provides services to the Company and the Partnership].
B.    The Compensation Committee (the "Committee") of the Board of Directors of the Company (the "Board") approved this award (the "Award") pursuant to the Sixth Amended and Restated Agreement of Limited Partnership of the Partnership dated as of June 3, 2016, as amended, restated and supplemented from time to time hereafter (the "Partnership Agreement"), to provide [officers of the Company] [employees of affiliates of the Company that provides services to the Company and the Partnership],  including the Grantee, in connection with their service, with the incentive compensation described in this Agreement, and thereby provide additional incentive for them to promote the progress and success of the business of the Company and its affiliates, including the Partnership. This Award was approved by the Committee pursuant to authority delegated to it by the Board as set forth in the Partnership Agreement to make grants of Class B Units (as defined in the Partnership Agreement).
C.    This Agreement evidences an award of Class B Units that have been authorized for issuance under the Partnership Agreement.
D.    Effective as of the Effective Date, the Committee has made an award to the Grantee of the number of Class B Units (the "Awarded Class B Units") set forth in Schedule A  [as compensation for services to be directly or indirectly rendered to the Company or the Partnership in 2018, 2019 and 2020].
E.    Grantee has agreed to accept the Awarded Class B Units in lieu of receiving any annual cash compensation for [2018, 2019 and 2020] for services to be rendered for the benefit of the Company and/or the Partnership.
NOW, THEREFORE, the Company, the Partnership and the Grantee agree as follows:
1.    Administration.  This Award shall be administered by the Committee which has the powers and authority as delegated by the Board.
2.    Definitions.  Capitalized terms used herein without definitions shall have the meanings given to those terms in the Partnership Agreement.  In addition, as used herein:
"Accounting Firm" has the meaning set forth in Section 8(n).
"Additional Valuation Date" means the last day of each calendar quarter following the Initial Valuation Date.
"Average Capital Account Balance" has the meaning provided in the Partnership Agreement.
"Awarded Class B Units" has the meaning set forth in the Recitals.

"Baseline Value" means (a) the Initial Baseline Value until the Initial Valuation Date; and (b) thereafter, the Market Capitalization as of the immediately prior Valuation Date.
"Capital Account" has the meaning provided in the Partnership Agreement.
"Change of Control" means:
(i)    Individuals who, as of the Effective Date, constitute the Board of Directors of the Company (the "Incumbent Board") cease for any reason to constitute at least a majority of the Board of Directors; provided, however, that any individual becoming a director subsequent to the Effective Date whose election, or nomination for election by the Company's stockholders, was approved by a vote of at least a majority of the directors then comprising the Incumbent Board shall be considered as though such individual were a member of the Incumbent Board, but excluding, for this purpose, any such individual whose initial assumption of office occurs as a result of either an actual or threatened election contest or other actual or threatened solicitation of proxies or consents by or on behalf of a person other than the Board of Directors;
(ii)    Approval by the stockholders of the Company of a reorganization, merger or consolidation, in each case unless, following such reorganization, merger or consolidation, (A) more than sixty percent (60%) of the combined voting power of the then outstanding voting securities of the corporation resulting from such reorganization, merger or consolidation entitled to vote generally in the election of directors is then beneficially owned, directly or indirectly, by all or substantially all of the individuals and entities who were the beneficial owners of the Company's outstanding voting securities immediately prior to such reorganization, merger or consolidation in substantially the same proportions as their beneficial ownership, immediately prior to such reorganization, merger or consolidation, of the Company's outstanding voting securities, and (B) at least a majority of the members of the board of directors of the corporation resulting from such reorganization, merger or consolidation were members of the Incumbent Board at the time of the execution of the initial agreement providing for such reorganization, merger or consolidation;
(iii)    Approval by the stockholders of the Company of (A) a complete liquidation or dissolution of the Company or (B) the sale or other disposition of all or substantially all of the assets of the Company, other than to a corporation with respect to which following such sale or other disposition (x) more than sixty percent (60%) of the combined voting power of the then outstanding voting securities of such corporation entitled to vote generally in the election of directors is then beneficially owned, directly or indirectly, by all or substantially all of the individuals and entities who were the beneficial owners of the Company's outstanding voting securities entitled to vote generally in the election of directors immediately prior to such sale or other disposition in substantially the same proportion as their beneficial ownership, immediately prior to such sale or other disposition, of the Company's outstanding voting securities, and (y) at least a majority of the members of the board of directors of such corporation were members of the Incumbent Board at the time of the execution of the initial agreement or action of the Board of Directors of the Company providing for such sale or other disposition of assets of the Company;
(iv)    The Sixth Amended and Restated Management Agreement among the Company, the Partnership and Preferred Apartment Advisors, LLC dated June 3, 2016 (as the same may be amended or modified) is terminated for any reason or no reason; or
(v)    The Company's Common Stock no longer being listed on the NYSE or other national U.S. stock exchange.
"Class B Units" means the Class B Units authorized pursuant to the Partnership Agreement.
"Code" means the Internal Revenue Code of 1986, as amended.

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"Common Stock" means the Company's common stock, par value $0.01 per share, either currently existing or authorized hereafter.
"Continuous Service" means the continuous service to [the Company as an officer] [Preferred Apartment Advisors, LLC as an employee] [NMP Advisors, LLC as an employee] [Preferred Capital Securities, LLC as an employee] [Preferred Residential Management, LLC as an employee] [Preferred Campus Management, LLC as an employee], without interruption or termination.  Continuous Service shall not be considered interrupted in the case of:  (A) any approved leave of absence; or (B) any change in status as long as the individual remains [an officer of the Company] [an employee of Preferred Apartment Advisors, LLC or Preferred Residential Management, LLC or NMP Advisors, LLC or Preferred Campus Management, LLC or Preferred Capital Securities, LLC].  An approved leave of absence shall include sick leave, military leave, or any other authorized personal leave.
"Determination" has the meaning set forth in Section 8(n).
"Disability" means, with respect to the Grantee, a "permanent and total disability" as defined in Section 22(e)(3) of the Code.
"Earned Class B Units" means those Awarded Class B Units that have been determined by the Committee to have been earned on a Valuation Date based on the extent to which the Market Capitalization Goal Percentage has been achieved as set forth in Section 3(d) or have otherwise been earned under Section 4.
"Effective Date" means the close of business on January 2, 2018.
"Ending Common Stock Price" means, as of a particular date, the volume weighted average of the closing per share prices of the Common Stock reported by NYSE (or other national U.S. stock exchange) for the five (5) consecutive trading days ending on (and including) such date; provided, however, that if such date is the date upon which a Change of Control occurs, the Ending Common Stock Price as of such date shall be equal to the fair value, as determined by the Committee, of the total consideration paid or payable in the transaction resulting in the Change of Control for one share of Common Stock.
"Exchange Act" means the Securities Exchange Act of 1934, as amended.
"Excise Tax" has the meaning set forth in Section 8(n).
"Excise Tax Gross-Up Payment" has the meaning set forth in Section 8(n).
"Family Member" has the meaning set forth in Section 7.
"Forfeited Units" means the aggregate number of Class B Units and RSUs that were granted to all grantees effective as the Effective Date that have been forfeited as of a particular date.
"Forfeited Units Percentage" means the percentage calculated by following quotient: (A) the Total Award Units less the Forfeited Units; divided by (B) the Total Award Units.
"Initial Baseline Value" means the Market Capitalization on the Effective Date.
"Initial Valuation Date" means the earlier of (A) January 2, 2019, or (B) the date upon which a Change of Control shall occur.
"Market Capitalization" means the product of (A) the total number of shares of Common Stock issued and outstanding on the Effective Date as reported by the Company's transfer agent, as adjusted for stock splits, stock dividends, reverse stock splits, recapitalizations and the like that have occurred since the Effective Date, and (B) the Ending Common Stock Price as of the Valuation Date.

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"Market Capitalization Goal Percentage" means, as of a particular Valuation Date, the percentage calculated by following quotient: (A) the Market Capitalization on the Valuation Date less the Baseline Value; divided by (B) the Target Increase.
"Partial Service Factor" means a factor carried out to the sixth decimal to be used in calculating the Earned Class B Units pursuant to Section 4 in the event of a Qualified Termination of the Grantee's Continuous Service, determined by dividing the number of calendar days that have elapsed since the Effective Date to and including the date of the Grantee's Qualified Termination by 1,095.
"Partnership Units" or "Units" has the meaning provided in the Partnership Agreement.
"Payment" has the meaning set forth in Section 8(n).
"Person" means an individual, corporation, partnership, limited liability company, joint venture, association, trust, unincorporated organization, other entity or "group" (as defined in the Exchange Act).
"Plan" means the 2011 Stock Incentive Plan of the Company, as amended.
"Qualified Termination" has the meaning set forth in Section 4(b).
"RSUs" means Restricted Stock Units that have been authorized for issuance under the Plan.
"Securities Act" means the Securities Act of 1933, as amended.
"Separation from Service" means "separation from service" from the Company (within the meaning of Section 409A(a)(2)(A)(i) of the Code, and Treasury Regulation Section 1.409A-1(h)).
"Target Increase" means $4,598,624 multiplied by the Forfeited Units Percentage.
"Total Award Units" means the total number of Class B Units and RSUs granted effective as of the Effective Date as set forth in Schedule A.
"Transfer" has the meaning set forth in Section 7.
"Valuation Date" means each of (i) the Initial Valuation Date; (ii) the last business day of each calendar quarter after the Initial Valuation Date until all Awarded Class B Units have either become Earned Class B Units or have been forfeited pursuant to Section 4 of this Agreement and (iii) the date of a Change of Control if any of the Awarded Class B Units have not yet become Earned Class B Units for any reason.
"Vested Class B Units" means those Awarded Class B Units that have fully vested in accordance with the time-based vesting conditions of Section 3(c) or have vested on an accelerated basis under Section 4.
"Vesting Date" means each date Awarded Class B Units will become Vested Class B Units in accordance with Section 3(c) of this Agreement and the date of a Change of Control if any of the Awarded Class B Units have not yet become Vested Class B Units for any reason.
3.    Award.
(a)    The Grantee is granted as of the Effective Date, the number of Class B Units set forth on Schedule A which are subject to forfeiture provided in this Section 3 and Section 4.  The Class B Units will be forfeited unless within ten (10) business days from January 29, 2018 the Grantee executes and delivers a fully executed copy of this Agreement and such other documents that the Company and/or the Partnership reasonably request in order to comply with all applicable legal requirements, including, without limitation, federal and state securities laws.   

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(b)    Awarded Class B Units may become Vested Class B Units and Earned Class B Units in the amounts and upon the conditions set forth in this Section 3 and in Section 4, provided that, except as otherwise expressly set forth in this Agreement, the Continuous Service of the Grantee continues through and on each applicable Vesting Date or Valuation Date.  
(c)    Vesting.  Awarded Class B Units shall become Vested Class B Units on the following dates and in the following amounts, provided that the Continuous Service of the Grantee continues through the applicable Vesting Date.
	
		
	Vested Class B Units
	Vesting Date

	[1/3 of Awarded Class B Units]
	January 2, 2019

	[1/3 of Awarded Class B Units]
	January 2, 2020

	[1/3 of Awarded Class B Units]
	January 2, 2021

(d)    Earned Awards.  As soon as practicable following each Valuation Date, but as of the applicable Valuation Date, the Committee will determine:  
(i)    the Market Capitalization Goal Percentage; 
(ii)    the number of Awarded Class B Units that will become Earned Class B Units as of the applicable Valuation Date by multiplying the Market Capitalization Goal Percentage by the number of Awarded Class B Units (with the resulting number being rounded to the nearest whole Class B Unit or, in the case of 0.5 of a Class B Unit, up to the next whole Class B Unit) and reducing that product by the aggregate number of Earned Class B Units to which the Grantee was entitled prior to the current Valuation Date; and
(e)    If the aggregate number of Earned Class B Units under this Agreement is less than the number of Awarded Class B Units under this Agreement after any determination under Section 3(d), then the Committee will repeat the process in Section 3(d) on each subsequent Valuation Date until all Awarded Class B Units have either become Earned Class B Units or have been forfeited pursuant to Section 4 of this Agreement.
(f)    As of each Vesting Date and Valuation Date, for all Awarded Class B Units that have become both Vested Class B Units and Earned Class B Units, the Committee shall cause the Partnership to credit the Capital Account (as defined in the Partnership Agreement) attributable to all Awarded Class B Units that were not previously both Vested Class B Units and Earned Class B Units with an amount equal to the Average Capital Account Balance under the Partnership Agreement on the Vesting Date or Valuation Date, as applicable.
4.    Termination of Grantee's Employment; Death and Disability; Change of Control.
(a)If the Grantee ceases to be an [officer of the Company][ employee of Preferred Apartment Advisors, LLC][ employee of NMP Advisors, LLC] [employee of Preferred Capital Securities, LLC] [employee of Preferred Residential Management, LLC] [employee of Preferred Campus Management, LLC], the provisions of Sections 4(b) through Section 4(e) shall govern the treatment of the Grantee's Awarded Class B Units exclusively.  If a Change of Control occurs, Section 4(c) shall govern the treatment of the Grantee's Awarded Class B Units exclusively, notwithstanding the other provisions of this Agreement.

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(b)In the event of termination of the Grantee's Continuous Service before the any Vesting Date by Grantee's death or Disability (each a "Qualified Termination"), the Grantee will not forfeit the Awarded Class B Units upon such termination, but the following provisions of this Section 4(b) shall modify the treatment of the Awarded Class B Units:
(i)the calculations provided in Section 3(d) shall be performed as of each Valuation Date as if the Qualified Termination had not occurred;  
(ii)the Grantee's Awarded Class B Units shall be multiplied by the Partial Service Factor (with the resulting number being rounded to the nearest whole Class B Unit or, in the case of 0.5 of a Class B Unit, up to the next whole Class B Unit), and such adjusted number of Awarded Class B Units shall be deemed the Grantee's Awarded Class B Units for all purposes under this Agreement, and , as of the Initial Valuation Date, shall become Vested Class B Units and shall no longer be subject to forfeiture pursuant to Section 3(c); and
(iii)the number of Vested Class B Units and the number of Earned Class B Units calculated pursuant to Section 3(d) shall be determined using the number of Awarded Class B Units as adjusted pursuant to  Section 4(b)(ii); 
(c)If the calculations provided in Section 3(d) are triggered by a Change of Control prior to the Initial Valuation Date, all of the Grantee's Awarded Class B Units shall become Vested Class B Units immediately and automatically as of the date of the Change of Control.
(d)Notwithstanding the foregoing, in the event any payment to be made hereunder after giving effect to this Section 4 is determined to constitute "nonqualified deferred compensation" subject to Section 409A of the Code, then, to the extent the Grantee is a "specified employee" under Section 409A of the Code subject to the six-month delay thereunder, any such payments to be made during the six-month period commencing on the Grantee's "separation from service" (as defined in Section 409A of the Code) shall be delayed until the expiration of such six-month period.
(e)Upon termination of Continuous Service other than a Qualified Termination or a termination that is related to a Change of Control, all Awarded Class B Units that have not previously become both (i) Vested Class B Units and (ii) Earned Class B Units, shall, without payment of any consideration by the Partnership, automatically and without notice terminate, be forfeited and be and become null and void, and neither the Grantee nor any of his or her successors, heirs, assigns, or personal representatives will thereafter have any further rights or interests in such forfeited Awarded Class B Units; provided, however, that the Committee may determine, in its sole discretion, that all or any portion of the Awarded Class B Units otherwise forfeited, shall become both Vested Class B Units and Earned Class B Units pursuant to Section 3(d) of this Agreement and shall not be forfeited by Grantee.
5.    Conditions for Award Recipients. The Grantee shall have no rights with respect to this Agreement (and the Award evidenced hereby) unless he or she shall have accepted this Agreement prior to the close of business on the date described in Section 3(a) by (a)  signing and delivering to the Partnership a copy of this Agreement and (b) unless the Grantee is already a Limited Partner (as defined in the Partnership Agreement), signing, as a Limited Partner, and delivering to the Partnership a counterpart signature page to the Partnership Agreement (attached as Exhibit A). Upon acceptance of this Agreement by the Grantee, the Partnership Agreement shall be amended to reflect the issuance to the Grantee of the Class B Units so accepted. Thereupon, the Grantee shall have all the rights of a Limited Partner of the Partnership with respect to the number of Class B Units, as set forth in the Partnership Agreement, subject, however, to the restrictions and conditions specified herein. Class B Units constitute and shall be treated for all purposes as the property of the Grantee, subject to the terms of this Agreement and the Partnership Agreement.
6.    Distributions.

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(a)The holders of Awarded Class B Units and Vested Class B Units shall not be entitled to receive distributions from the Partnership until they become both Earned Class B Units and Vested Class B Units.
(b)All distributions paid with respect to Earned Class B Units and Vested Class B Units shall be fully vested and non-forfeitable when declared.
7.    Restrictions on Transfer.
(a)Except as otherwise permitted by the Committee in its sole discretion, none of the Awarded Class B Units, Earned Class B Units, Vested Class B Units or Partnership Units into which Earned Class B Units and Vested Class B Units have been converted shall be sold, assigned, transferred, pledged, hypothecated, given away or in any other manner disposed or encumbered, whether voluntarily or by operation of law (each such action a "Transfer"); provided that Earned Class B Units and Vested Class B Units may be Transferred to the Grantee's Family Members (as defined below) by gift, bequest or domestic relations order; and provided further that the transferee agrees in writing with the Company and the Partnership to be bound by all the terms and conditions of this Agreement and that subsequent transfers shall be prohibited except those in accordance with this Section 7.  Additionally, all such Transfers must be in compliance with all applicable securities laws (including, without limitation, the Securities Act) and the applicable terms and conditions of the Partnership Agreement. In connection with any such Transfer, the Partnership may require the Grantee to provide an opinion of counsel, satisfactory to the Partnership, that such Transfer is in compliance with all federal and state securities laws (including, without limitation, the Securities Act).  Any attempted Transfer not in accordance with the terms and conditions of this Section 7 shall be null and void, and neither the Partnership nor the Company shall reflect on its records any change in record ownership of any Earned Class B Units or Vested Class B Units as a result of any such Transfer, shall otherwise refuse to recognize any such Transfer and shall not in any way give effect to any such Transfer.  Except as provided in this Section 7, this Agreement is personal to the Grantee, is non-assignable and is not transferable in any manner, by operation of law or otherwise, other than by will or the laws of descent and distribution.  
(b)For purposes of this Agreement, "Family Member" of a Grantee, means the Grantee's child, stepchild, grandchild, parent, stepparent, grandparent, spouse, former spouse, sibling, niece, nephew, mother-in-law, father-in-law, son-in-law, daughter-in-law, brother-in-law, or sister-in-law, including adoptive relationships, any person sharing the Grantee's household (other than a tenant of the Grantee), a trust in which one or more of these persons (or the Grantee) own more than 50 percent of the beneficial interests, and a partnership or limited liability company in which one or more of these persons (or the Grantee) own more than 50 percent of the voting interests.
8.    Miscellaneous.
(a)Amendments. This Agreement may be amended or modified only with the consent of the Company and the Partnership acting through the Committee; provided that any such amendment or modification which materially adversely affects the rights of the Grantee hereunder must be consented to by the Grantee to be effective as against him or her. Notwithstanding the foregoing, this Agreement may be amended in writing signed only by the Company and the Partnership to correct any errors or ambiguities in this Agreement and/or to make such changes that do not materially adversely affect the Grantee's rights hereunder. This grant shall in no way affect the Grantee's participation or benefits under any other plan or benefit program maintained or provided by the Company or the Partnership or any of their subsidiaries or affiliates.
(b) Committee Determinations.  The Committee will make the determinations and certifications required by this Award as promptly as reasonably practicable following the occurrence of the event or events necessitating such determinations or certifications. In the event of a Change of Control, the 

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Committee will make such determinations within a period of time that enables the Company to make any payments due hereunder not later than the date of consummation of the Change of Control.
(c) Status of Class B Units. The Class B Units are equity interests in the Partnership. The number of shares of Common Stock reserved for issuance underlying outstanding Awarded Class B Units will be determined by the Committee in light of all applicable circumstances, including calculations made or to be made under Section 3, vesting, capital account allocations and/or balances under the Partnership Agreement, and the exchange ratio in effect between Partnership Units and shares of Common Stock. The Company will have the right at its option, as set forth in the Partnership Agreement, to issue shares of Common Stock in exchange for Partnership Units in accordance with the Partnership Agreement, subject to certain limitations set forth in the Partnership Agreement, and such shares of Common Stock, if issued, will be issued under the Plan. The Grantee acknowledges that the Grantee will have no right to approve or disapprove such determination by the Committee.
(d)Legend.  The records of the Partnership evidencing the Class B Units shall bear an appropriate legend, as determined by the Partnership in its sole discretion, to the effect that such Class B Units are subject to restrictions as set forth herein and in the Partnership Agreement.
(e)Compliance With Law.  The Partnership and the Grantee will make reasonable efforts to comply with all applicable securities laws. In addition, notwithstanding any provision of this Agreement to the contrary, no Awarded Class B Units will become Earned Class B Units or Vested Class B Units at a time that such change would result in a violation of any such law.
(f)Grantee Representations; Registration.
(i)The Grantee hereby represents and warrants that (A) he or she understands that he or she is responsible for consulting his or her own tax advisor with respect to the application of the U.S. federal income tax laws, and the tax laws of any state, local or other taxing jurisdiction to which the Grantee is or by reason of this Award may become subject, to his or her particular situation; (B) the Grantee has not received or relied upon business or tax advice from the Company, the Partnership or any of their respective employees, agents, consultants or advisors, in their capacity as such; (C) the Grantee provides services to the Partnership on a regular basis and in such capacity has access to such information, and has such experience of and involvement in the business and operations of the Partnership, as the Grantee believes to be necessary and appropriate to make an informed decision to accept this Award; (D) Class B Units are subject to substantial risks; (E) the Grantee has been furnished with, and has reviewed and understands, information relating to this Award; (F) the Grantee has been afforded the opportunity to obtain such additional information as he or she deemed necessary before accepting this Award; and (G) the Grantee has had an opportunity to ask questions of representatives of the Partnership and the Company, or persons acting on their behalf, concerning this Award.
(ii)The Grantee hereby acknowledges that: (A) there is no public market for  Class  B Units or Partnership Units into which Awarded Class B Units will be converted and neither the Partnership nor the Company has any obligation or intention to create such a market; (B) sales of Class B Units and Partnership Units are subject to restrictions under the Securities Act and applicable state securities laws; (C) because of the restrictions on transfer or assignment of Class B Units and Partnership Units set forth in the Partnership Agreement and in this Agreement, the Grantee may have to bear the economic risk of his or her ownership of the Class B Units covered by this Award for an indefinite period of time; (D) shares of Common Stock issued under the Plan in exchange for Partnership Units, if any, are expected to be covered by a Registration Statement on Form S-8 (or a successor form under applicable rules and regulations of the Securities and Exchange Commission) under the Securities Act, to the extent that the Grantee is eligible to receive such shares under the Plan at the time of such issuance and such registration Statement is then effective under the Securities Act; (E) resales of shares of Common Stock issued under the 

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Plan in exchange for Partnership Units, if any, shall only be made in compliance with all applicable restrictions (including in certain cases "blackout periods" forbidding sales of Company securities) set forth in the then applicable Company employee manual or insider trading policy and in compliance with the registration requirements of the Securities Act or pursuant to an applicable exemption therefrom.
(g)Section 83(b) Election.  The Grantee hereby agrees to make an election to include the Awarded Class B Units in gross income in the year in which the Awarded Class B Units are issued pursuant to Section 83(b) of the Code substantially in the form attached as Exhibit B and to supply the necessary information in accordance with the regulations promulgated thereunder. The Grantee agrees to file such election (or to permit the Partnership to file such election on the Grantee's behalf) within thirty (30) days after the Effective Date with the IRS Service Center where the Grantee files his or her personal income tax returns, and to file a copy of such election with the Grantee's U.S. federal income tax return for the taxable year in which the Awarded Class B Units are issued to the Grantee. So long as the Grantee holds any Awarded Class B Units, the Grantee shall disclose to the Partnership in writing such information as may be reasonably requested with respect to ownership of Class B Units as the Partnership may deem reasonably necessary to ascertain and to establish compliance with provisions of the Code applicable to the Partnership or to comply with requirements of any other appropriate taxing authority.
(h)Tax Consequences.  The Grantee acknowledges that (i) neither the Company nor the Partnership has made any representations or given any advice with respect to the tax consequences of acquiring, holding, selling or converting Partnership Units or making any tax election (including the election pursuant to Section 83(b) of the Code) with respect to the Class B Units and (ii) the Grantee is relying upon the advice of his or her own tax advisor in determining such tax consequences.
(i)Severability.  If, for any reason, any provision of this Agreement is held invalid, such invalidity shall not affect any other provision of this Agreement not so held invalid, and each such other provision shall to the full extent consistent with law continue in full force and effect. If any provision of this Agreement shall be held invalid in part, such invalidity shall in no way affect the rest of such provision not held so invalid, and the rest of such provision, together with all other provisions of this Agreement, shall to the full extent consistent with law continue in full force and effect.
(j)Governing Law.  This Agreement is made under, and will be construed in accordance with, the laws of the State of Delaware, without giving effect to the principles of conflict of laws of such state.
(k)No Obligation to Continue Position as an Employee, Consultant or Advisor.  Neither the Company nor any affiliate is obligated by or as a result of this Agreement to continue to have the Grantee as an employee, consultant or advisor and this Agreement shall not interfere in any way with the right of the Company or any affiliate to terminate the Grantee's employment at any time.
(l)Notices.  Any notice to be given to the Company shall be addressed to the Secretary of the Company at 3284 Northside Parkway NW, Suite 150, Atlanta, Georgia 30327 and any notice to be given to the Grantee shall be addressed to the Grantee at the Grantee's address as it appears on the records of the Company, or at such other address as the Company or the Grantee may hereafter designate in writing to the other.
(m)Withholding and Taxes.  No later than the date as of which an amount first becomes includible in the gross income of the Grantee for income tax purposes or subject to the Federal Insurance Contributions Act withholding with respect to this Award, the Grantee will pay to the Company or, if appropriate, any of its affiliates, or make arrangements satisfactory to the Committee regarding the payment of any United States federal, state or local or foreign taxes of any kind required by law to be withheld with respect to such amount; provided, however, that if any Class B Units or Partnership Units are withheld (or returned), the number of Class B Units or Partnership Units so withheld (or returned) shall be limited to the 

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number which have a fair market value on the date of withholding equal to the aggregate amount of such liabilities based on the minimum statutory withholding rates for federal, state, local and foreign income tax and payroll tax purposes that are applicable to such supplemental taxable income. The obligations of the Company under this Agreement will be conditional on such payment or arrangements, and the Company and its affiliates shall, to the extent permitted by law, have the right to deduct any such taxes from any payment otherwise due to the Grantee.
(n)Excise Tax Gross-Up Payment.  
(i)    In the event it shall be determined that any payment or distribution to Grantee or for Grantee's benefit which is in the nature of compensation and is contingent on a change in the ownership or effective control of the Company or the ownership of a substantial portion of the assets of the Company (within the meaning of Section 280G(b)(2) of the Code), paid or payable pursuant to this Agreement (a "Payment"), would be subject (in whole or in part) to the excise tax imposed by Section 4999 of the Code (together with any interest or penalties imposed with respect to such excise tax, the "Excise Tax"), then Grantee shall be entitled to receive an additional payment (the "Excise Tax Gross-Up Payment") in an amount such that, after payment by Grantee of all taxes (and any interest or penalties imposed with respect to such taxes), including, without limitation, any income taxes and Excise Tax imposed upon the Excise Tax Gross-Up Payment, Grantee retains an amount of the Excise Tax Gross-Up Payment equal to the Excise Tax imposed upon the Payments.  The Company’s obligation to make Excise Tax Gross-Up Payments under this Section 8(n) shall not be conditioned upon Grantee's Separation from Service. For purposes of determining the amount of any Excise Tax Gross-Up Payment, Grantee shall be considered to pay federal income tax at Grantee's actual marginal rate of federal income taxation in the calendar year in which the Excise Tax Gross-Up Payment is to be made, and state and local income taxes at Grantee's actual marginal rate of taxation in the state and locality of Grantee's residence on the date on which the Excise Tax Gross-Up Payment is calculated, for purposes of this Section 8(n), net of Grantee's actual reduction in federal income taxes which could be obtained from deduction of such state and local taxes, and taking into consideration the phase-out of Grantee's itemized deductions under federal income tax law.
(ii)     All determinations required to be made under this Section 8(n), including whether and when an Excise Tax Gross-Up Payment is required, the amount of such Excise Tax Gross-Up Payment and the assumptions to be utilized in arriving at such determination, shall be made by such nationally recognized accounting firm as may be selected by the Board as constituted immediately prior to the change in control transaction (the "Accounting Firm"), provided, that the Accounting Firm’s determination shall be made based upon "substantial authority" within the meaning of Section 6662 of the Code. The Accounting Firm shall provide its determination (the "Determination"), together with detailed supporting calculations and documentation, to Grantee and the Company within 15 business days following the date of termination if applicable, or such other time as requested by you (provided that Grantee reasonably believes that any of the Payments may be subject to the Excise Tax) or the Company. All fees and expenses of the Accounting Firm shall be borne solely by the Company. Any Excise Tax Gross-Up Payment, as determined pursuant to this Section 8(n), shall be paid by the Company to you no later than the later of (i) 15 business days following the receipt of the Accounting Firm’s Determination or (ii) 15 business days preceding the date the Excise Tax becomes payable; provided, however, that in no event shall any such Excise Tax Gross-Up Payment or any payment of any income or other taxes to be paid by the Company under this Section 8(n) be made later than the end of Grantee's taxable year next following Grantee's taxable year in which Grantee remits the related taxes. Any costs and expenses incurred by the Company on behalf of Grantee under this Section 8(n) due to any tax contest, audit or litigation will be paid by the Company by the end of Grantee's taxable year following Grantee's taxable year in which the taxes that are the subject of the tax contest, audit or litigation are remitted to the taxing authority, or where as a result of such tax contest, audit or litigation no taxes are remitted, the end of Grantee's taxable year following 

10    

Grantee's taxable year in which the audit is completed or there is a final and non-appealable settlement or other resolution of the contest or litigation.
(iii)    Grantee shall immediately notify the Company in writing of any claim by the Internal Revenue Service that, if successful, would require the payment by the Company of the Excise Tax Gross-Up Payment. Grantee shall not pay such claim prior to the expiration of the 30-day period following the date on which Grantee gives such notice to the Company (or such shorter period ending on the date that any payment of taxes with respect to such claim is due). If the Company notifies Grantee in writing prior to the expiration of such period that the Company desires to contest such claim, Grantee shall give the Company all information reasonably requested by the Company relating to such claim, cooperate with the Company and take such action in connection with contesting such claim as the Company shall reasonably request in writing from time to time, and permit the Company to participate in and control any proceedings relating to such claim; provided, however, that the Company shall bear and pay directly all costs and expenses incurred in connection with such contest, and shall indemnify and hold Grantee harmless, on an after-tax basis, for any Excise Tax or income tax (including interest and penalties) imposed as a result of such representation and contest.
(o)Headings.  The headings of paragraphs of this Agreement are included solely for convenience of reference and shall not control the meaning or interpretation of any of the provisions of this Agreement.
(p)Counterparts.  This Agreement may be executed in multiple counterparts with the same effect as if each of the signing parties had signed the same document. All counterparts shall be construed together and constitute the same instrument.
(q)Successors and Assigns.  This Agreement shall be binding upon and inure to the benefit of the parties and any successors to the Company and the Partnership, on the one hand, and any successors to the Grantee, on the other hand, by will or the laws of descent and distribution, but this Agreement shall not otherwise be assignable or otherwise subject to hypothecation by the Grantee.
(r)Section 409A.  This Agreement shall be construed, administered and interpreted in accordance with a good faith interpretation of Section 409A of the Code, to the extent applicable.  Any provision of this Agreement that is inconsistent with applicable provisions of Section 409A of the Code, or that may result in penalties under Section 409A of the Code, shall be amended, with the reasonable cooperation of the Grantee and the Company and the Partnership, to the extent necessary to exempt this Agreement from, or bring it into compliance with, Section 409A of the Code.
[signature page follows]

11    

 
IN WITNESS WHEREOF, the undersigned have caused this Agreement to be effective as of the Effective Date.
 
	
				
	 
	PREFERRED APARTMENT COMMUNITIES, INC., a Maryland corporation

	 
	 
	 

	 
	 
	 

	 
	By:
	 

	 
	Name:
	 

	 
	Title:
	 

	 
	 
	 

	 
	 
	 

	 
	PREFERRED APARTMENT COMMUNITIES OPERATING PARTNERSHIP, L.P., a Delaware limited partnership

	 
	 

	 
	 
	By:
	Preferred Apartment Communities, Inc., a Maryland corporation, its general partner

	 
	 
	 
	 

	 
	By:
	 

	 
	Name:
	 

	 
	Title:
	 

	 
	 
	 

	 
	 
	 

	 
	GRANTEE

	 
	 
	 

	 
	 

	 
	Name:
	 

[Signature Page to 2018 Class B Unit Award Agreement (_______________________)]

EXHIBIT A
  
FORM OF LIMITED PARTNER SIGNATURE PAGE
 
The Grantee, desiring to become one of the within named Limited Partners of Preferred Apartment Communities Operating Partnership, L.P., hereby accepts all of the terms and conditions of and becomes a party to, the Sixth Amended and Restated Agreement of Limited Partnership, dated as of June 3, 2016, of Preferred Apartment Communities Operating Partnership, L.P. as amended through this date (the "Partnership Agreement"). The Grantee agrees that this signature page may be attached to any counterpart of the Partnership Agreement.
 
	
			
	 
	Signature Line for Limited Partner:

	 
	 

	 
	 

	 
	 

	 
	Name:
	 

	 
	 
	 

	 
	Date:
	 

	 
	 

	 
	Address of Limited Partner:

 
EXHIBIT B
 
ELECTION TO INCLUDE IN GROSS INCOME IN YEAR OF TRANSFER OF 
PROPERTY PURSUANT TO SECTION 83(b) OF THE INTERNAL REVENUE CODE
 
The undersigned hereby makes an election pursuant to Section 83(b) of the Internal Revenue Code with respect to the property described below and supplies the following information in accordance with the regulations promulgated thereunder:
 
1.      The name, address and taxpayer identification number of the undersigned are:
 
Name:                                                                                                             (the "Taxpayer")
 
Address:
 
Social Security No./Taxpayer Identification No.:       -      -
 
2.                    Description of property with respect to which the election is being made:  Class B Units ("Class B Units") in Preferred Apartment Communities Operating Partnership, L.P. (the "Partnership").
 
3.                    The date on which the Class B Units were issued is                , 2018.  The taxable year to which this election relates is calendar year 2018.
 
4.             Nature of restrictions to which the Class B Units are subject:
 
(a)                    With limited exceptions, until the Class B Units vest, the Taxpayer may not transfer in any manner any portion of the Class B Units without the consent of the Partnership.
 
(b)                   The Taxpayer's Class B Units are subject to forfeiture until they vest in accordance with the provisions in the applicable Award Agreement and Partnership Agreement.
 
5.                   The fair market value at time of issue (determined without regard to any restrictions other than restrictions which by their terms will never lapse) of the Class B Units with respect to which this election is being made was $         per Class B Unit.
 
6.       The amount paid by the Taxpayer for the Class B Units was $0.00 per Class B Unit.
 
 
7.       A copy of this statement has been furnished to the Partnership and Preferred Apartment Communities, Inc.

 
	
				
	Dated:
	 
	 
	 

	 
	 

	 
	 

	 
	Name:

 
SCHEDULE A TO 2018 CLASS B UNIT 
AWARD AGREEMENT
 
Award Date:  January 2, 2018
 
Name of Grantee:
 
Number of Awarded Class B Units to Grantee:

Aggregate Number of Class B Units on Award Date:Exhibit 10.1

 Exhibit 10.1 

Execution Copy 

COOPERATION AGREEMENT 

This Cooperation Agreement (this “Agreement”), dated as of January 26, 2018, is entered into by and between Basswood
Capital Management, L.L.C. (“Basswood”) and Regional Management Corp. (the “Company”). 
 WHEREAS,
Basswood has informed the Company that it beneficially owns 1,511,995 shares of the common stock, par value $0.10 per share, of the Company (the “Common Stock”), which represents approximately 13.0% of the issued and outstanding
shares of Common Stock; 
 WHEREAS, the Company’s Board of Directors (the “Board”) has considered the qualifications
of Jonathan D. Brown (the “Basswood Director”); and 
 WHEREAS, the Company and Basswood have determined to come to an
agreement regarding the appointment of the Basswood Director to the Board and to the subsequent nomination of the Basswood Director at the Company’s 2018 Annual Meeting of Stockholders (including any adjournment or postponement thereof or any
special meeting held in lieu thereof, the “2018 Annual Meeting”) and certain other matters as set forth herein. 
 NOW,
THEREFORE, in consideration of and reliance upon the mutual covenants and agreements contained herein, and for other good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, the parties hereto agree as follows:

 1. Nomination of Basswood Director. 

(a) The Company agrees that in accordance with the Company’s certificate of incorporation, by-laws
and Delaware law, the Board shall increase the size of the Board by one and appoint the Basswood Director, effective concurrently with the execution of this Agreement. Unless the Minimum Ownership Threshold (defined below) is no longer met, the
Company shall include the Basswood Director (other than in the case of the refusal or inability of any such person to serve, in which case the Board shall include his substitute chosen in accordance with Section 1(d)) appointed to the Board
pursuant to this Section 1(a) as a nominee to the Board on the slate of director nominees recommended by the Board in the Company’s proxy statement and on its proxy card relating to the 2018 Annual Meeting and shall use its reasonable best
efforts (which shall include the solicitation of proxies) to obtain the election of any such Basswood Director at the 2018 Annual Meeting (it being understood that such efforts shall not be less than the efforts used by the Company to obtain the
election of any other independent director nominee nominated by it to serve as a director at the 2018 Annual Meeting). 
 (b) As a condition
to the Basswood Director’s appointment to the Board and any subsequent nomination for election as a director of the Company at the 2018 Annual Meeting (or any Applicable Meeting (as defined below)), Basswood shall (or shall have caused the
Basswood Director to) have provided to the Company a completed D&O Questionnaire in the form provided to Basswood by the Company prior to the execution of this Agreement and executed an irrevocable resignation as director in the form attached
hereto as Exhibit A (the “Irrevocable Resignation Letter”). As a further condition to any Basswood Director’s nomination for election as a director of the Company at the 2018 Annual Meeting (or any Applicable Meeting),
Basswood shall (or shall 

 
cause the Basswood Director to), as promptly as practicable upon request of the Company, provide (i) executed consents from any Basswood Director to be named as a nominee in the
Company’s proxy statement for the 2018 Annual Meeting (or any Applicable Meeting) and to serve as a director if so elected, in the form provided to Basswood by the Company, (ii) any information required to be or customarily disclosed for
all applicable directors, candidates for directors, and their affiliates and representatives in a proxy statement or other filings under applicable law or stock exchange rules or listing standards, (iii) information in connection with assessing
eligibility, independence and other criteria applicable to all applicable directors or satisfying compliance and legal obligations applicable to all independent directors, and (iv) such other information as reasonably requested by the Company
from time to time with respect to Basswood or the Basswood Director. 
 (c) At all times while serving as a member of the Board, the
Basswood Director shall comply with all policies, procedures, processes, codes, rules, standards and guidelines applicable to non-employee Board members, including the Company’s Corporate Governance
Guidelines and Code of Business Conduct and Ethics and all relevant Board committee charter requirements, provided that no provision of any such document shall be deemed to be violated by any communication permitted by this Agreement pursuant to the
last sentence of Section 2(a). 
 (d) During the Standstill Period for so long as a Resignation Trigger has not occurred, the Board
shall not take any action to remove, or cause to be removed, the Basswood Director. If, during the Standstill Period (as defined below), the Basswood Director resigns or ceases to serve for any reason other than as a result of a Resignation Trigger
(as defined below), and provided that such Basswood Director is otherwise then entitled to be appointed or to serve, as applicable, as a director of the Company pursuant to this Agreement, then Basswood shall be entitled to designate a
replacement director who shall (i) be reasonably acceptable to the Company after the Company has conducted its ordinary course interview process for directors of the Company, (ii) qualify as an independent director of the Company under the
rules of the New York Stock Exchange Listed Company Manual, and (iii) provide the items required to be provided by the Basswood Director pursuant to Section 1(b). Basswood shall have the right to continue submitting the name of a proposed
replacement director to the Company until the Company accepts such proposed replacement director to be appointed to the Board so long as Basswood is entitled to appoint a director to the Board under this Agreement, and the Company agrees that upon
being presented with such proposed replacement director it shall conduct its ordinary course interview and review process as promptly as practicable and, subject to the satisfactory completion of such process by the proposed replacement director,
confirm such acceptance (or withholding of such acceptance) as promptly as practicable thereafter, subject to Basswood and such proposed director’s compliance with Section 1(b). Thereafter, such individual shall be promptly appointed to
fill the remaining term of the Basswood Director being replaced and shall be considered to be a “Basswood Director” under this Agreement. 

(e) Notwithstanding anything to the contrary in this Agreement, the Company’s obligations under this Agreement shall terminate
immediately, and Basswood shall cause the Basswood Director then serving on the Board to promptly offer to resign from the Board and any committee thereof (and, if requested by the Company, promptly deliver his written resignations to the Board
(which shall provide for his immediate resignations), it being understood that it shall be in the Board’s sole discretion whether to accept or reject such resignations), and the Company 

  
 2 

 
shall have no further obligation with respect to the Basswood Director under this Section 1, if either (i) Basswood and the Basswood Affiliates (as defined below), collectively, no
longer beneficially own at least the Minimum Ownership Threshold, or (ii) Basswood or the Basswood Director fails to comply with or breaches any of the terms of this Agreement in any material respect and, if capable of being cured, such
material breach or failure has not been cured within 15 days after receipt by Basswood of written notice from the Company specifying such material breach or failure provided that the Company is not in material breach of this Agreement at such
time (each, a “Resignation Trigger”).    The term “Minimum Ownership Threshold” shall mean an aggregate Net Long Position of at least 874,705 shares of Common Stock (subject to adjustment for
stock splits, reverse stock splits, stock dividends, and similar adjustments) (by way of example, in the case of a 2:1 stock split, such minimum number of shares would double and be equal to 1,749,410 shares of Common Stock). In furtherance of
clause (i) of this Section 1(e), the Basswood Director has, concurrently with the execution of this Agreement, executed the Irrevocable Resignation Letter and delivered it to the Company. The term “Net Long Position” shall
mean such shares of Common Stock beneficially owned, directly or indirectly, that constitute such person’s net long position as defined in Rule 14e-4 promulgated by the SEC (as defined below) under the
Exchange Act (as defined below) mutatis mutandis, but the “long position” of such person for this purpose shall not include any shares as to which such person does not have the right to vote or direct the vote or as to which such
person has entered into a derivative or other agreement, arrangement or understanding that hedges or transfers, in whole or in part, directly or indirectly, any of the economic consequences of ownership of such shares. In addition, Basswood agrees
that, to the extent not disclosed in its public filings with the SEC, it will promptly notify the Company if Basswood and the Basswood Affiliates, collectively, cease to beneficially own at least the Minimum Ownership Threshold. 

(f) If so requested by Basswood, the Board shall appoint and maintain the Basswood Director then serving on the Board to any existing or newly
created committee of the Board that is designated to review or oversee strategic alternatives for the Company (including but not limited to any Extraordinary Transaction (as defined below)), and shall provide the Basswood Director then serving on
the Board the same opportunity as all other members of the Board to participate in the deliberations of the Board regarding such Extraordinary Transaction, subject to customary recusal requests in the event of any potential conflict of interest.

 (g) Basswood acknowledges, on behalf of itself and the Basswood Affiliates, that the Basswood Director shall have all of the rights and
obligations, including fiduciary duties to the Company and its stockholders, of a director under applicable law and the Company’s organizational documents while such Basswood Director is serving on the Board. 

(h) In accordance with the Company’s customary director reimbursement policies, the Company will reimburse Basswood for the reasonable
travel and related expenses of the Basswood Director associated with the Basswood Director’s service on the Board. In addition, in accordance with the Company’s organizational documents and policies, the Basswood Director will be entitled
to indemnification rights and will be covered by the D&O insurance policies applicable, in each case, to other directors. 
 (i) The
Basswood Director shall be entitled to resign from the Board at any time in his discretion. 

  
 3 

 2. Standstill. 

(a) During the Standstill Period, Basswood agrees that, unless specifically requested in writing by the Company or expressly permitted by this
Agreement, Basswood and each of its respective Affiliates or Associates (collectively (with Basswood) and individually, the “Basswood Affiliates”) and their representatives, shall not, directly or indirectly (including through any
Basswood Director), in any manner, alone or in concert with others: 
 (i) acquire, offer, seek or propose to acquire, or
agree to acquire, by purchase or otherwise, beneficial ownership of additional shares of Common Stock if, after giving effect to such acquisition, Basswood and its clients and their respective Affiliates would collectively beneficially own more than
19.9% of the outstanding shares of Common Stock; provided, that, nothing herein will require Common Stock to be sold to the extent that Basswood and its clients and their respective Affiliates, collectively, exceed the ownership limit under
this clause (i) as the result of a share repurchase or similar Company action that reduces the number of outstanding shares of Common Stock; 

(ii) make, or in any way participate in, any “solicitation” of “proxies” to vote (as such terms are used in
the rules of the Securities and Exchange Commission (“SEC”)) or seek to advise or influence any person (other than private communications with any Basswood Affiliate) with respect to the voting of (including engaging in any withhold
or no vote campaign) any Common Stock; 
 (iii) separately or in conjunction with any other person, submit a proposal for or
offer of (with or without conditions) any Extraordinary Transaction. The term “Extraordinary Transaction” shall be defined to mean any of the following involving the Company or any of its subsidiaries or its or their securities or a
material amount of the assets or businesses of the Company or any of its subsidiaries: any tender offer or exchange offer, merger, acquisition, business combination, reorganization, restructuring, recapitalization,
spin-off, split-off, licensing, sale or acquisition of, or joint venture or other partnership with respect to, material assets, sale or purchase of securities,
liquidation or dissolution, or any similar transaction; 
 (iv) without limiting the last sentence of this Section 2(a),
propose a change in structure, size or composition of the Board or executive officers of the Company; 
 (v) form, join or in
any way participate in any “group” (as such term is defined in Section 13(d)(3) of the Exchange Act (a “13D Group”) with respect to any voting securities of the Company, other than to the extent the Basswood Director,
Basswood and the Basswood Affiliates are deemed to be a 13D Group; 
 (vi) present at any annual meeting or any special
meeting of the Company’s stockholders or through action by written consent any proposal for consideration for action by stockholders, conduct any stockholder referendum, seek to call a special meeting of the Company’s stockholders, propose
any nominee for election to the Board or seek the removal of any member of the Board, in each case subject to the last sentence of this Section 2(a); 

  
 4 

 (vii) grant any proxy, consent or other authority to vote with respect to any
matters (other than to the named proxies included in the Company’s proxy card for an annual meeting or a special meeting) or deposit any of the Common Stock (or any securities convertible into, exchangeable for or otherwise exercisable to
acquire such Common Stock) held by any of them in a voting trust or other arrangement of similar effect, or subject them to a voting agreement or other arrangement of similar effect; 

(viii) make or issue, or cause to be made or issued, any public disclosure, statement or announcement (including the filing or
furnishing of any document or report with the SEC or any other governmental agency or any disclosure to any journalist, member of the media or securities analyst) (1) in support of any solicitation described in Section 2(a)(ii) or
otherwise inconsistent with the restrictions set forth in the standstill provisions, or (2) that constitutes an ad hominem attack on, or otherwise disparages, defames or slanders, the Company or its affiliates or any of their
current or former directors, officers or employees, provided that, subject to Section 7 of this Agreement and the confidentiality obligations of the Basswood Director, Basswood and the Basswood Affiliates may correct any public statement
made by or on behalf of the Company that references or relates to Basswood or any Basswood Affiliate (or any current or former principal or employee thereof) and may make objective statements in response to any public statements made by or on behalf
of the Company with respect to Basswood or any Basswood Affiliate (or any current or former principal or employee thereof) or Basswood’s strategy, business, activities or management; 

(ix) institute, solicit, assist or join, as a party, any litigation, arbitration or other proceeding against or involving the
Company or any of its current or former directors or officers (including derivative actions) other than to enforce the provisions of this Agreement; 

(x) other than in open market transactions where the identity of the purchaser is not known and in underwritten widely
dispersed public offerings, sell, offer or agree to sell directly or indirectly, through swap or hedging transactions or otherwise, the securities of the Company or any rights decoupled from the underlying securities of the Company held by Basswood
or any Basswood Affiliate to any person or entity not a party to this Agreement (a “Third Party”) that, to Basswood or the Basswood Affiliate’s knowledge (after reasonable inquiry in connection with a private, non-open market transaction, it being understood that such knowledge shall be deemed to exist with respect to any publicly available information, including information in documents filed with the SEC), would result
in such Third Party, together with its affiliates and associates, owning, controlling or otherwise having any beneficial or other ownership interest in the aggregate of more than 5% of the shares of Common Stock outstanding at such time or would
increase the beneficial or other ownership interest of any Third Party who, together with its affiliates and associates, has a beneficial or other ownership interest in the aggregate of more than 5% of the shares of Common Stock outstanding at such
time; 

  
 5 

 (xi) request the Company or any of its representatives, directly or indirectly,
to amend or waive any provision of this Section 2, in each case which would reasonably be expected to result in a public announcement of such request; 

(xii) challenge the validity or enforceability of this Section 2; 

(xiii) enter into any discussions, negotiations, agreements or undertakings with any person with respect to the foregoing or
advise, assist, encourage or seek to persuade others to take any action with respect to any of the foregoing. 
 Neither the foregoing provisions of this
Section 2(a) nor any other provision of this Agreement (other than Section 3 below) shall obligate Basswood or any Basswood Affiliate to vote its shares of Common Stock (or refrain from voting its shares of Common Stock) in any manner to
be voted at any annual or special meeting or written consent of stockholders or stockholder referendum and, subject to Section 3, Basswood and the Basswood Affiliates may vote their respective shares of Common Stock (or refrain from voting
their respective shares of Common Stock) in their sole discretion. 
 The foregoing provisions of this Section 2(a) shall not be deemed to prohibit
Basswood or any Basswood Representatives from communicating privately regarding or privately advocating for or against any of the matters described in this Section 2(a) with, or from privately requesting a waiver of any of the foregoing
provisions of this Section 2(a) from, in each case, the Company’s directors and executive officers, so long as such communications or requests are not intended to, and would not reasonably be expected to, require any public disclosure of
any such communications or requests. 
 (b) The Company agrees that, during the Standstill Period it shall not, and shall cause each of its
Affiliates and Associates not to, directly or indirectly, make or issue, or cause to be made or issued, any public disclosure, statement or announcement (including the filing or furnishing of any document or report with the SEC or any other
governmental agency or any disclosure to any journalist, member of the media or securities analyst) that constitutes an ad hominem attack on, or otherwise disparages, defames or slanders Basswood, the Basswood Director, the Basswood
Affiliates or any current or former principal or employee of Basswood or the Basswood Affiliates; provided that the Company may correct any public statement made by or on behalf of Basswood that references or relates to the Company or any
Affiliate or Associate of the Company (or any current or former director, officer or employee thereof) and may make objective statements in response to any public statements made by or on behalf of Basswood with respect to the Company, any Affiliate
or Associate of the Company (or any current or former director, officer or employee thereof). For the avoidance of doubt, a public statement or announcement shall only be deemed to be made by the Company if made by either (i) an executive
officer or member of the Board or (ii) an employee or representative of the Company authorized to make such statement or announcement on behalf of the Company. 

  
 6 

 (c) Nothing in this Section 2 shall prohibit the Basswood Director, acting in its fiduciary
capacity as a director of the Company, from (1) voting for or against any matter or making any statement at any meeting of the Board or of any committee thereof, or (2) making any private statement to the Chief Executive Officer or any
other director of the Company in his capacity as a director. 
 (d) The Basswood Director shall promptly advise the Company if the Basswood
Director in his capacity as a director receives an approach or inquiry regarding a potential proposed Extraordinary Transaction or proxy contest with respect to the Company. 

(e) For purposes of this Agreement, 

(i) the terms “Affiliate” and “Associate” shall have the meaning given to such terms in Rule 12b-2 promulgated by the SEC under the Securities Exchange Act of 1934, as amended (the “Exchange Act”); provided that the term “Associates” in such definition shall be deemed to be
preceded by the word “controlled”); 
 (ii) the terms “beneficial owner” and “beneficial
ownership” shall have the meaning set forth in Rule 13d-3 promulgated under the Exchange Act. 

(iii) the terms “person” or “persons” shall mean any individual, corporation (including not-for-profit), general or limited partnership, limited liability or unlimited liability company, joint venture, estate, trust, association, organization or other entity of
any kind or nature; and 
 (iv) the term “Standstill Period” shall mean the period commencing on the date
hereof and ending on the earliest of (1) 12:01 a.m. (New York time) on the date that is 20 days prior to the nomination deadline for the 2019 annual stockholders meeting, (2) if the Company fails to comply with or breaches any of the terms of
this Agreement in any material respect and, if capable of being cured, such material breach or failure has not been cured within 15 days after receipt by the Company of written notice from Basswood specifying such material breach or failure and
provided further that Basswood and the Basswood Director are not in material breach of this Agreement at such time, (3) the consummation of an Extraordinary Transaction following which consummation the Basswood Director no longer
serves on the Board and (4) a reorganization of the Company under any federal or state law relating to bankruptcy or insolvency. If the Company provides written notice to Basswood that it will nominate the Basswood Director for election to the
Board at the 2019 annual stockholders meeting or for any annual meeting of stockholders of the Company subsequent thereto (each, an “Applicable Meeting”) at least 20 days prior to the nomination deadline for such Applicable Meeting
and Basswood has agreed in advance to such nomination (it being understood that Basswood will respond to any written request as to whether it agrees to such nomination within five (5) business days after receipt of notice by Basswood of such
proposed inclusion), then the Standstill Period shall be automatically extended until the date that is 20 days prior to the nomination deadline for the annual stockholders meeting subsequent to such Applicable Meeting. 

  
 7 

 3. Voting Agreement. During the Standstill Period, Basswood shall cause all shares of
Common Stock beneficially owned, directly or indirectly, by it, or by any Basswood Affiliate, to be present for quorum purposes and to be voted, at any annual or special meeting of stockholders (and at any adjournments or postponements thereof), and
further agrees that at such meetings it and they shall vote in favor of each director nominated by the Board for election at such meetings and further agrees that at such meetings it and they shall vote in accordance with the Board’s
recommendations with respect to any other director nominees and any other proposal or business that may be the subject of stockholder action at such meetings; provided, however, that, notwithstanding the foregoing, with respect to
(a) a proposal to authorize or approve an Extraordinary Transaction, (b) matters related to the implementation of takeover defenses, (c) new or amended incentive compensation plans submitted for stockholder approval, (d) if
either Institutional Shareholder Services Inc. (“ISS”) or Glass Lewis & Co., LLC (“Glass Lewis”) recommend otherwise with respect to any other proposal (other than with respect to the election or removal of
directors) at any annual or special meeting of stockholders, in each case Basswood and the Basswood Affiliates may vote their shares of Common Stock beneficially owned, directly or indirectly, in the sole discretion of Basswood or the Basswood
Affiliate, as applicable. 
 4. Representations of the Company. The Company represents and warrants to Basswood as follows:
(a) the Company has the power and authority to execute, deliver and carry out the terms and provisions of this Agreement and to consummate the transactions contemplated hereby; and (b) this Agreement has been duly and validly authorized,
executed and delivered by the Company, constitutes a valid and binding obligation and agreement of the Company and is enforceable against the Company in accordance with its terms. 

5. Representations of Basswood. Basswood represents and warrants to the Company as follows: (a) Basswood is duly organized,
validly existing and in good standing under the laws of its jurisdiction of organization and has the requisite power and authority to execute, deliver and carry out the terms and provisions of this Agreement and to consummate the transactions
contemplated hereby; (b) this Agreement has been duly and validly authorized, executed and delivered by Basswood, constitutes a valid and binding obligation and agreement of Basswood and is enforceable against Basswood in accordance with its
terms; (c) Basswood, together with the Basswood Affiliates, beneficially own as of the date hereof, directly or indirectly, an aggregate of 1,511,995 shares of Common Stock and such shares of Common Stock constitute all of the Common Stock
beneficially owned by Basswood and the Basswood Affiliates or in which Basswood or the Basswood Affiliates have any interest or right to acquire or vote, whether through derivative securities, voting agreements or otherwise, and (d) neither
Basswood nor any Basswood Affiliate is party to any agreement, arrangement, understanding or relationship (including any repurchase or similar so-called “stock borrowing” agreement or arrangement)
the purpose or effect of which is to mitigate loss to (i) reduce the economic risk (of ownership or otherwise) of shares of any class or series of the Company (through “short” positions in shares of common stock, “long”
puts, “short” calls, “short” forward, swap positions or otherwise), (ii) manage the risk of share price changes, or (iii) increase or decrease the voting power with respect to the shares of any class or series of the
Company, or which provides, directly or indirectly, the opportunity to profit from any decrease in the price or value of the shares of any class or series of the Company (“Short Interests”). 

  
 8 

 6. Public Announcement. 

(a) The Company shall announce this Agreement and/or the appointment of the Basswood Director by means of a press release in a form reasonably
acceptable to Basswood (such press release the “Press Release”). 
 (b) The Company shall promptly prepare and file a Form 8-K reporting entry into this Agreement and appending or incorporating by reference this Agreement and the Press Release as exhibits thereto. 

(c) Basswood shall promptly prepare and file an amendment (the “13D Amendment”) to the Schedule 13D filed by Basswood on
December 15, 2017, reporting the entry into this Agreement and amending the applicable items to conform to the obligations hereunder. The 13D Amendment will be consistent with the Press Release and the terms of this Agreement, and Basswood will
provide the Company with a reasonable opportunity to review in advance any subsequent disclosure relating to this Agreement in any subsequent Schedule 13D or similar filing during the Standstill Period. 

(d) None of Basswood, the Basswood Affiliates or the Basswood Director shall issue a press release in connection with this Agreement or the
actions contemplated hereby. 
 7. Confidentiality. 

(a) Basswood agrees to hold all Evaluation Material in strict confidence and will not disclose or divulge any Evaluation Material to any
person. Further, neither Basswood nor the Basswood Director shall use such information other than for the sole purpose of advising Basswood on it and its clients’ investment in the Company and, in the case of the Basswood Director, other than
in connection with the exercise of his duties as a Board director. For purposes of this Agreement, the term “Evaluation Material” shall mean any and all information concerning or relating to the Company or any of its subsidiaries or
Affiliates that is furnished (regardless of the manner in which it is furnished, including in written or electronic format or orally, gathered by visual inspection or otherwise) to the Basswood Director, Basswood, a Basswood Affiliate or any
Basswood Representative by or on behalf of the Company or its agents, representatives, attorneys, advisors, directors, officers or employees (“Company Representatives”), together with all notes, analyses, reports, models,
compilations, studies, interpretations, documents, records or extracts thereof containing, referring, relating to, based upon or derived from such information, in whole or in part. The term “Evaluation Material” shall not include
such information that (a) was provided to or made available to Basswood, the Basswood Director, any Basswood Representative (acting on behalf of Basswood) or a Basswood Affiliate on a non-confidential
basis prior to it being furnished to the Basswood Director, Basswood, a Basswood Affiliate or any Basswood Representative by or on behalf of the Company or any Company Representative from a source not known, after reasonable inquiry, to bound by an
agreement or obligation of confidentiality with respect to such information, (b) is or becomes generally available to the public other than as a result of a disclosure by the Basswood Director, Basswood, any of their respective Affiliates or
any Basswood 

  
 9 

 
Representative in violation of this Agreement, or (c) has been or is independently developed by the Basswood Director, Basswood, any of their respective Affiliates or any Basswood
Representative without the use of any Evaluation Material. Notwithstanding the foregoing, the Basswood Director may provide Evaluation Material to any Basswood officer, member, partner, employee or counsel (each, a “Basswood
Representative”) who has a need to know such information for the sole purpose of advising Basswood on it and its clients’ investment in the Company or advising Basswood as to its rights and obligations under this Agreement, and may
discuss such Evaluation Material with such persons for such purposes, provided that any such Basswood Representative provided with any such information shall keep it strictly confidential, not disclose any of the Evaluation Material in any manner
whatsoever without the prior written consent of the Company and use it only for such purposes; and, in any event, Basswood shall be responsible for any non-compliance with such confidentiality and use
requirements by any Basswood Representative who is provided with such information. Basswood shall, shall cause the Basswood Director and shall instruct each Basswood Representative to, use the same degree of care to protect and safeguard the
Evaluation Material from disclosure to at least the same extent that they do so with respect to Basswood’s own confidential information. It is understood and agreed that the Basswood Director shall not disclose to Basswood or any Basswood
Representative any Legal Advice (as defined below) that may be included in the Evaluation Material with respect to which such disclosure may constitute waiver of the Company’s attorney-client privilege or attorney work-product privilege;
provided, however, that the Basswood Director may provide such disclosure of Legal Advice if the Basswood Director shall not have taken any action, or failed to take any action, that has the purpose or effect of waiving attorney-client privilege or
attorney work product privilege with respect to any portion of such Legal Advice and if reputable outside legal counsel of national standing provides the Company with a written opinion that such disclosure will not waive the Company’s attorney
client privilege or attorney work product privilege with respect to such Legal Advice. “Legal Advice” as used herein shall be solely and exclusively limited to the advice provided by legal counsel and shall not include factual
information or the formulation or analysis of business strategy that is not protected by the attorney-client or attorney work-product privilege. 

(b) In the event that Basswood, the Basswood Director or any Basswood Representative becomes legally compelled (including any request or
demand of or by a regulatory authority having jurisdiction over Basswood, the Basswood Director or any Basswood Representative) to disclose any Evaluation Material, Basswood and the Basswood Director agree (except in the case of requested or
demanded disclosure in the course of a routine examination or inquiry by a regulatory authority having jurisdiction over Basswood, the Basswood Director or any Basswood Representative that is not targeted at the Company, its affiliates, the
Evaluation Material or the matters contemplated by this Agreement), unless prohibited by law, to provide the Company with reasonable advance notice under the circumstances prior to any such disclosure to enable the Company to seek a protective order
or other appropriate remedy (and if the Company seeks such an order or other remedy, Basswood will provide such cooperation as the Company shall reasonably request, at the Company’s sole cost and expense), at its sole cost and expense. If, in
the absence of a protective order or the receipt of a waiver hereunder, Basswood, the Basswood Director or such Basswood Representative is nonetheless, based on the advice of the Basswood Director’s or Basswood’s legal counsel, required to
disclose any such information, Basswood, the Basswood Director or such Basswood Representative, as the case may be, may make the required disclosure (solely to the extent required). In no event will Basswood, the Basswood Director or any

  
 10 

 
Basswood Representative oppose action by the Company to obtain a protective order or other remedy to prevent the disclosure of Evaluation Material or to obtain reliable assurance that
confidential treatment will be accorded the Evaluation Material. For the avoidance of doubt, it is understood that there shall be no “legal requirement” requiring Basswood, the Basswood Director or any Basswood Representative to disclose
any Evaluation Material solely by virtue of the fact that, absent such disclosure, any of them or any of their respective Affiliates, or any of Basswood’s clients, would be prohibited from purchasing, selling or engaging in derivative or other
voluntary transactions with respect to, the Common Stock or the securities of any other company or otherwise proposing or making an offer to do any of the foregoing, or any of them would be unable to file any proxy materials in compliance with
Section 14(a) of the Exchange Act or the rules and regulations promulgated thereunder. 
 (c) Basswood acknowledges that (a) none
of the Company or any of the Company Representatives makes any representation or warranty, express or implied, as to the accuracy or completeness of any Evaluation Material, and (b) none of the Company or any of its representatives shall have
any liability to Basswood, the Basswood Director, any Basswood client, any Basswood Representative or the Basswood Director or any of their respective Affiliates relating to or resulting from the use of the Evaluation Material or any errors therein
or omissions therefrom. 
 (d) All Evaluation Material shall remain the property of the Company. No other person shall by virtue of any
disclosure of and/or use of any Evaluation Material acquire any rights with respect thereto, all of which rights shall remain exclusively with the Company. At any time after the date on which this Agreement has been validly terminated pursuant to
Section 13 hereof or following a Resignation Trigger, Basswood shall, and shall cause the Basswood Director to, promptly return to the Company or destroy all hard copies of the Evaluation Material and use commercially reasonable efforts to
permanently erase or delete all electronic copies of the Evaluation Material in their or any of the Basswood Representatives’ possession or control (and, upon the request of the Company, shall certify to the Company in writing that such
Evaluation Material has been erased or deleted, as the case may be); provided, however, that Basswood and the Basswood Representatives shall (x) be entitled to retain copies of the Evaluation Material to the extent required by
applicable law or regulation or by its bona fide internal compliance policies and (y) not be required to erase electronically stored Evaluation Material that has been saved to a back-up file in accordance
with its or ordinary back-up practices; provided that such Evaluation Material is not accessible in the ordinary course of business and is not accessed except as required for such back-up purposes (it being understood that the confidentiality and use provisions of this agreement shall survive for so long as such material is retained, notwithstanding the termination of this Agreement as set
forth in Section 13 hereof). Notwithstanding the return or erasure or deletion of Evaluation Material, Basswood and the Basswood Representatives will continue to be bound by the obligations contained herein. 

(e) Basswood hereby acknowledges that it is aware that the United States securities laws prohibit any person who has received from an issuer
any material, non-public information from purchasing or selling securities of such issuer or from communicating such information to any other person under circumstances in which it is reasonably foreseeable
that such person is likely to purchase or sell such securities. 

  
 11 

 8. Remedies. The parties agree that irreparable damage would occur in the event any of the
provisions of this Agreement were not performed in accordance with the terms hereof and that such damage would not be adequately compensable in monetary damages. Accordingly, the parties hereto shall be entitled to an injunction or injunctions to
prevent breaches of this Agreement, to enforce specifically the terms and provisions of this Agreement exclusively in the Court of Chancery of the State of Delaware or, if such court shall not have jurisdiction, any state or federal court sitting in
the State of Delaware, and to require the resignation of the Basswood Director from the Board following a Resignation Trigger, in addition to any other remedies at law or in equity, and each party agrees it will not take any action, directly or
indirectly, in opposition to another party seeking or obtaining such relief. Each of the parties hereto agrees to waive any bonding requirement under any applicable law, in the case any other party seeks to enforce the terms by way of equitable
relief. Furthermore, each of the parties hereto (a) consents to submit itself to the personal jurisdiction of the Court of Chancery of the State of Delaware and the federal and other state courts sitting in the State of Delaware in the event
any dispute arises out of this Agreement or the transactions contemplated by this Agreement, (b) agrees that it shall not attempt to deny or defeat such personal jurisdiction by motion or other request for leave from any such court,
(c) agrees that it shall not bring any action relating to this Agreement or the transactions contemplated by this Agreement in any court other than such federal or state courts of the State of Delaware, and each of the parties irrevocably
waives the right to trial by jury, and (d) each of the parties irrevocably consents to service of process by a reputable overnight mail delivery service, signature requested, to the address set forth in Section 11 hereof or as otherwise
provided by applicable law. THIS AGREEMENT SHALL BE GOVERNED IN ALL RESPECTS, INCLUDING VALIDITY, INTERPRETATION AND EFFECT, BY THE LAWS OF THE STATE OF DELAWARE APPLICABLE TO CONTRACTS EXECUTED AND TO BE PERFORMED WHOLLY WITHIN SUCH STATE WITHOUT
GIVING EFFECT TO ANY CONFLICT OR CHOICE OF LAW PRINCIPLES THAT MAY RESULT IN THE APPLICATION OF THE LAWS OF ANOTHER JURISDICTION. 
 9.
Expenses. All attorneys’ fees, costs and expenses incurred in connection with this Agreement and all matters related hereto will be paid by the party incurring such fees, costs or expenses. 

10. Entire Agreement; Amendment. This Agreement and all exhibits attached hereto contain the entire agreement and understanding of the
parties with respect to the subject matter hereof and supersede any and all prior and contemporaneous agreements, memoranda, arrangements and understandings, both written and oral, between the parties, or any of them, with respect to the subject
matter hereof. This Agreement may be amended only by an agreement in writing executed by the parties hereto, and no waiver of compliance with any provision or condition of this Agreement and no consent provided for in this Agreement shall be
effective unless evidenced by a written instrument executed by the party against whom such waiver or consent is to be effective. No failure or delay by a party in exercising any right, power or privilege hereunder shall operate as a waiver thereof,
nor shall any single or partial exercise thereof preclude any other or further exercise thereof or the exercise of any right, power or privilege hereunder. 

  
 12 

 11. Notices. All notices, consents, requests, instructions, approvals and other
communications provided for herein and all legal process in regard hereto shall be in writing and shall be deemed validly given, made or served, when actually received during normal business hours at the address specified in this subsection: 

 

							
		  	 if to the Company:
	  	Regional Management Corp.	  	
		  		  	979 Batesville Road, Suite B	  	
		  		  	Greer, South Carolina 29651	  	
		  		  	Attention: General Counsel	  	
		
		  	 With a copy (which shall not constitute notice) to:

				
		  		  	Simpson Thacher & Bartlett LLP	  	
		  		  	425 Lexington Avenue	  	
		  		  	New York, NY 10017	  	
		  		  	Attention: Maripat Alpuche	  	
				
		  	 if to Basswood:
	  	Basswood Capital Management, L.L.C.	  	
		  		  	645 Madison Avenue, 10th Floor	  	
		  		  	New York, NY 10022	  	
		  		  	Attention: Marc Samit	  	
		  		  	                 Justin Cannizzaro	  	
		
		  	 With a copy (which shall not constitute notice) to:

				
		  		  	Willkie Farr & Gallagher LLP	  	
		  		  	787 Seventh Avenue	  	
		  		  	New York, NY 10019	  	
		  		  	Attention: Tariq Mundiya	  	
		  		  	                  Michael Brandt	  	

 12. Severability. If at any time subsequent to the date hereof, any provision of this Agreement shall
be held by any court of competent jurisdiction to be illegal, void or unenforceable, such provision shall be of no force and effect, but the illegality or unenforceability of such provision shall have no effect upon the legality or enforceability of
any other provision of this Agreement. 
 13. Termination. This Agreement shall terminate upon the expiry of the Standstill Period
(subject to any extension as provided herein), provided that Section 7 of this Agreement shall survive for a period of eighteen months after the date on which no Basswood Director serves as a director of the Company. 

14. Counterparts. This Agreement may be executed in two or more counterparts either manually or by electronic or digital signature
(including by email transmission), each of which shall be deemed to be an original and all of which together shall constitute a single binding agreement on the parties, notwithstanding that not all parties are signatories to the same counterpart.

  
 13 

 15. No Third Party Beneficiaries; Assignment. This Agreement is solely for the benefit of
the parties hereto and is not binding upon (other than successors to the parties hereto) or enforceable by any other persons. No party to this Agreement may assign its rights or delegate its obligations under this Agreement, whether by operation of
law or otherwise, and any assignment in contravention hereof shall be null and void. Nothing in this Agreement, whether express or implied, is intended to or shall confer any rights, benefits or remedies under or by reason of this Agreement on any
persons other than the parties hereto, nor is anything in this Agreement intended to relieve or discharge the obligation or liability of any third persons to any party. 

16. Interpretation and Construction. When a reference is made in this Agreement to a Section, such reference shall be to a Section of
this Agreement, unless otherwise indicated. The headings contained in this Agreement are for reference purposes only and shall not affect in any way the meaning or interpretation of this Agreement. Whenever the words “include,”
“includes” and “including” are used in this Agreement, they shall be deemed to be followed by the words “without limitation.” The words “hereof, “herein” and “hereunder” and words of similar
import when used in this Agreement shall refer to this Agreement as a whole and not to any particular provision of this Agreement. The word “will” shall be construed to have the same meaning as the word “shall.” The words
“date hereof” will refer to the date of this Agreement. The word “or” is not exclusive. The definitions contained in this Agreement are applicable to the singular as well as the plural forms of such terms. Any agreement,
instrument, law, rule or statute defined or referred to herein means, unless otherwise indicated, such agreement, instrument, law, rule or statute as from time to time amended, modified or supplemented. Each of the parties hereto acknowledges that
it has been represented by counsel of its choice throughout all negotiations that have preceded the execution of this Agreement, and that it has executed the same with the advice of said independent counsel. Each party cooperated and participated in
the drafting and preparation of this Agreement and the documents referred to herein, and any and all drafts relating thereto exchanged among the parties shall be deemed the work product of all of the parties and may not be construed against any
party by reason of its drafting or preparation. Accordingly, any rule of law or any legal decision that would require interpretation of any ambiguities in this Agreement against any party that drafted or prepared it is of no application and is
hereby expressly waived by each of the parties hereto, and any controversy over interpretations of this Agreement shall be decided without regards to events of drafting or preparation. 

[Signature Pages Follow] 

  
 14 

 IN WITNESS WHEREOF, each of the parties hereto has executed this Agreement, or caused the same to
be executed by its duly authorized representative as of the date first above written. 
  

			
	REGIONAL MANAGEMENT CORP.,
		
	By	 	 /s/ Brian J. Fisher

	Name:	 	Brian J. Fisher
	Title:	 	Vice President, General Counsel, and Secretary

 [Signature Page to Cooperation Agreement] 

 
			
	BASSWOOD CAPITAL MANAGEMENT, L.L.C., 
		
	by	 	 /s/ Matthew Lindenbaum

	Name:	 	Matthew Lindenbaum
	Title:	 	Principal

 [Signature Page to Cooperation Agreement] 

 EXHIBIT A 

FORM OF IRREVOCABLE RESIGNATION 

OF THE BASSWOOD DIRECTOR 
 January 26,
2018 
 Attention: Board of Directors 
 Regional Management
Corp. 
 979 Batesville Road, Suite B 
 Greer, South Carolina
29651 
  

	 	Re:	Resignation 

 Ladies and Gentlemen: 

This irrevocable resignation is delivered pursuant to Section 1(b) and 1(e) of the Cooperation Agreement, dated as of January 26,
2018 (the “Agreement”), by and between Regional Management Corp. and Basswood Capital Management, L.L.C. Capitalized terms used herein but not defined shall have the meaning set forth in the Agreement. Effective only upon, and
subject to, the occurrence of Basswood and the Basswood Affiliates collectively no longer beneficially owning at least the Minimum Ownership Threshold, I hereby resign from my position as a director of the Company and from any and all committees of
the Board on which I serve. 
 [Signature Page Follows] 

  
 A-1 

 This resignation may not be withdrawn by me at any time during which it is effective. 

 

			
	Sincerely,
		
	By:	 	  

	Name:	 	

 [Signature Page to Irrevocable Resignation] 

  
 A-2

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