Document:

2011 Executive Incentive Plan

 

 

Background and Objectives

 

The overall executive compensation strategy of The Edelman Financial
Group Inc. (formerly Sanders Morris Harris Group Inc.) (“TEFG” or the “Company”) is to provide
key executives with targeted total cash pay opportunities that generally are competitive with median total cash pay opportunities
in wealth and asset management companies of similar size. The two primary elements of the TEFG cash compensation program are base
salary and the 2011 Executive Incentive Plan (the “Plan” or “EIP”). TEFG base salaries are
designed to be broadly competitive with industry standards and are used to reward an executive’s job performance over time.
All awards under the Plan are determined and awarded at the sole discretion of the Compensation Committee of the TEFG Board of
Directors (the “Committee”).

 

The Plan provides annual incentive compensation opportunity
for key executives for achieving critical financial and other goals of and for TEFG. The following document defines Plan eligibility,
the size of potential award opportunities, performance measurements and, form and timing of award payments, administrative guidelines,
and definitions for ongoing Plan management.

 

The Plan does not include potential equity-based awards, which
are covered by the Company’s separate Restricted Stock Unit Plan a sub-plan under the TEFG Long-Term Incentive Plan.

 

Capitalized terms that are used but not defined in the Plan
shall have the meaning ascribed to them in the TEFG Long-Term Incentive Plan.

 

Eligibility

 

Employees who are eligible to participate in the Plan (“Participants”)
will be proposed by the Chairman of the Board, Chief Executive Officer, President, and Chief Financial Officer of the Company (the
“Plan Committee”) and approved by the Compensation Committee at the beginning of each performance/award period.
Generally, Participants will be selected from key executives who primarily are responsible for the annual growth and profitability
of TEFG, i.e., generally senior managers and officers. For 2011, 14 senior officers and executives are proposed as Participants.

 

Targeted Award Opportunities

 

At the beginning of each fiscal year, each Participant will
be assigned a targeted award opportunity proposed by the Plan Committee and approved by the Committee that can increase or decrease
in value, based on actual performance achievement. Targeted award opportunities for Participants for 2011 are shown in Exhibit
1. Plan targeted award opportunities may be re-defined from time to time by the Plan Committee, as modifications are made in
TEFG’s executive compensation strategy.

 

On or before March 31, 2012, each Participant’s salary
rate at December 31, 2011, will be multiplied by his or her actual EIP award percentage earned (determined by applying the performance
measures set forth below) to determine the dollar value of the award for the prior performance cycle.

 

Performance Measures

 

Four Plan financial performance measures, totaling 80% by weight
of all performance measures, are proposed for the 2011 performance period, as follows:

 

		·	Adjusted
                                                                                                        cash flow from operations1
                                                                                                        (“ACF”)
                                                                                                        — weighted 30%
                                                                                                        (target — 110% of
                                                                                                        2010 ACF).

		·	Client
                                                                                                          investment results
                                                                                                          — weighted 20%
                                                                                                          (target — change
                                                                                                          in adjusted 60/402in
                                                                                                          2011).

		·	Net new client money — weighted 20% (target— 4%
increase over 2010 year-end client assets).

		·	Expenses adjusted for non-recurring and extraordinary items as
a percentage of revenue — weighted 10% (target — no greater than 2010

 

 

	1	Cash flow from operations will be adjusted by excluding from the calculation any cash flow items related to (a) discontinued operations of the Company, (b) marketable securities owned, (c) securities sold, not yet purchased, and (d) other non-recurring and extraordinary items.
	2	Investment performance of portfolio invested 60% in Standard & Poors 500 Index and 40% in Barclay’s Capital U.S. Aggregate Bond Index from January 1, 2011 to December 31, 2011, less 50 basis points.

 

    	 

    	 

    
 

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	2011 Executive Incentive Plan	 

 

The Plan performance targets will be proposed by the Plan Committee
and approved by the Committee as soon as possible after the beginning of each fiscal year.

 

The final 20% portion of the performance measures will be determined
on a discretionary basis by the Committee for the Chief Executive Officer and by the Plan Committee for the other Participants
and will be based on the degree to which the executive has mastered the primary duties and responsibilities of his or her present
job.

 

TEFG performance calculations for the Plan shall exclude nonrecurring
and extraordinary items, which are defined at the sole discretion of the Committee. Performance goals for EIP awards may be adjusted
during the year if a major change occurs in the Company’s operations or capital structure, e.g., an acquisition or merger.
In addition to the EIP targets, the Committee and the Plan Committee jointly will establish minimum acceptable and outstanding
Plan goals, which are currently as follows:

 

		·	Minimum Acceptable — The TEFG performance level at or
below which no incentive will be paid is 75% of the EIP performance measure target;

		·	Target — The TEFG performance
level where the Plan adjustment factor is 1X, with “X” equal to the target incentive, is 100% of the EIP performance
measure target; and

		·	Outstanding — The TEFG performance level at or above
which the Plan adjustment factor is 2X, with “X” equal to the target incentive is 125% of the EIP performance
measure target.

 

EIP awards will be interpolated for actual performance falling
closest to the nearest 5% increment between any of the foregoing goals.

 

Exhibit 2 presents the performance matrix for calculating
EIP awards. This performance matrix may be revised by the Plan Committee with approval of the Committee if the Company’s
business strategy and performance focus changes.

 

Form and Timing of Awards

 

SEIP award calculations will be finalized on or before Mach
30, 2012. All SEIP awards will be paid in cash in quarterly installments in the year immediately following a performance cycle,
as follows:

 

		·	50% of the final award on March 31, 2012

		·	25% of the final award on August 15, 2012

		·	25% of the final award on November 30, 2012

 

In no event will any payment of an award be made subsequent
to December 31, 2012.

 

In the case of a Change in
Control (as defined in the Company’s Long-Term Incentive Plan) prior to November 30, 2012, all SEIP awards shall be paid
in cash on the effective date of such Change in Control. Notwithstanding
the foregoing, if and to the extent that any provision of this Plan or an award would cause a payment of deferred compensation
that is subject to Section 409A(a)(2) of the Internal Revenue Code of 1986, as amended (the “Code”), to be made upon
the occurrence of a “Change in Control,” then such payment shall not be made unless such “Change in Control”
satisfies the requirements of Section 409A(2)(A)(v) of the Code and applicable regulations and rulings thereunder.

 

Administrative Guidelines and Definitions

The Plan operates at the discretion
of the Committee. The Committee may exercise considerable discretion and judgment in interpreting the Plan, and adopting, from
time to time, rules and regulations that govern the administration of the Plan. Once the Compensation Committee approves
Plan participants, award targets, and performance goals, the Plan Committee is delegated authority to administer the Plan. All
decisions of the Committee and the Plan Committee are final, conclusive, and binding on all parties,
including the Company, its stockholders, and employees.

 

    	 

    	 

    
 

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	2011 Executive Incentive Plan	 

 

		·	Employee Termination — 

 

Termination during 2011. Except as expressly set forth
below, in the event a Participant’s employment with TEFG terminates for any reason prior to the end of the workday on December 31,
2011, such Participant will be ineligible for any award under the Plan. In other words, if a Participant is employed according
to Company records through the end of the workday on December 31, 2011, the Participant will, subject to the following provisions,
be eligible for any award earned under the Plan for 2011.

    

Any Participant (or his or her estate) who ceases to be employed
by the Company prior to January 1, 2012, due to the Participant’s death, Disability, or Retirement (as such terms are
defined in the TEFG Long-Term Incentive Plan), subject to the Participant’s execution of a waiver and release of claims in
a form and manner satisfactory to the Company, will be eligible to receive a EIP award based on an adjusted annual base salary
amount, but otherwise in the same manner, to the same extent, and at the same time as the Participant would have received such
EIP award if such Participant’s employment had continued through December 31, 2011 (i.e., based on achievement
of applicable performance measures). The Participant’s annual base salary will be the result of the following formula: X
× Y/12, where:

 

X = the Participant’s annual base
salary as in effect as of the date of termination of employment; and

Y = the number of calendar
months the Participant was actively employed by the Company during 2011, rounded up for any partial month.

 

Termination on or after January 1, 2012.  Except
as expressly set forth below, a Participant who ceases to be employed by TEFG for any reason on or after January 1, 2012, will
forfeit any unpaid EIP award. Any Participant (or his or her estate) who ceases to be employed by the Company subsequent to December
31, 2011, but prior to November 30, 2012, due to the Participant’s death, Disability, or Retirement, subject to the Participant’s
execution of a waiver and release of claims in a form and manner satisfactory to the Company, will be eligible to be paid all unpaid
EIP awards in the same manner, to the same extent, and at the same time as the Participant would have been paid such EIP awards
if such Participant’s employment had continued through November 30, 2012.

 

		·	New Hires — Employees must have a minimum of six months
of service to be eligible for an award, unless waived by the Plan Committee. EIP awards for new hires are earned on a pro-rata
basis, based on their date of employment. 

		·	Base Salary Rate — Base salary for EIP award calculations
shall be the annualized base rate in effect on December 31, 2011.

		·	Support Documentation — The Chief Financial Officer of
the Company shall be responsible for maintaining all necessary support documentation regarding performance and bonus calculations
under the Plan.

 

Amendment

 

The Committee may at any time suspend,
terminate, modify, waive, or amend any or all of the provisions of this Plan; provided, however, that no such action shall,
without the written consent of the affected Participants, reduce the Company’s obligation for the payment of any outstanding
awards under the Plan with respect to such Participants, or further defer the payment of such awards, or accelerate the payment
of such awards in a manner that subjects such awards to the tax imposed under Section 409A of the
Internal Revenue Code of 1986, as amended and the regulations thereunder (“Section 409A”).

Governing Law

 

The Plan is governed by the laws of the State of Texas.

 

Withholding Taxes

 

The Company has the right to make such provisions as it deems
necessary or appropriate to satisfy any obligations it may have under law to withhold federal, state or local income or other taxes
incurred by reason of payments pursuant to the Plan.

 

    	 

    	 

    
 

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	2011 Executive Incentive Plan	 

 

Section 409A

 

Notwithstanding anything to the contrary contained herein, this
Plan is intended to satisfy the requirements of Section 409A. Accordingly, all provisions herein, or incorporated by reference,
shall be construed and interpreted to satisfy the requirements of Section 409A. Further, for purposes of Section 409A, each payment
of compensation under this Agreement shall be treated as a separate payment of compensation.

 

Non-transferability of Awards

 

No award under this Plan, and no rights or interests therein,
will be assignable or transferable by a Participant (or legal representative).

 

Effective Date

 

This Plan is effective as of January 1, 2011, and continues
until terminated, suspended, modified, or amended by the Committee.

 

    	 

    	 

    
  

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	2011 Executive Incentive Plan	 

 

Exhibit 1

 

Proposed 2011 Participants and Award
Targets

 

 

	Title	Targeted Award
	TEFG Legal Counsel	40% of salary
	EFS Chief Financial Officer (w/Division responsibility)	40% of salary
	TEFG Chief Compliance Officer	50% of salary
	EFS Chief Compliance Officer	50% of salary
	TEFG Controller	40% of salary
	VP Information Technology	35% of salary
	Chief Technology Officer	35% of salary
	Director, Financial Reporting	35% of salary
	SVP Operations	20% of salary
	VP Operations	20% of salary
	VP Marketing Communications	30% of salary
	VP Human Resources	20% of salary
	VP Human Resources/Training	20% of salary
	TEFG Administrative Manager	20% of salary

 

    	 

    	 

    
 

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	2011 Executive Incentive Plan	 

 

Exhibit 2

Proposed 2011 Performance Goals and Weights

Versus Award Opportunity Earned

 

 

	Level of Performance Achievement	Adjusted Cash Flow from Operations	Client Investment Results	Net New Client Money	Expenses as Percentage of Revenue	%  of Target Award Earned	Discretionary
	 	 	 	 	 	 	 
	(Weight)	(30%)	(20%)	(20%)	(10%)	 	(20%)
	 	 	 	 	 	 	 
	Outstanding	125%	125%	125%	75%	200%	100%
	 	120%	120%	120%	80%	180%	
	 	115%	115%	115%	85%	160%
	 	110%	110%	110%	90%	140%
	 	105%	105%	105%	95%	120%
	Target	100%	100%	100%	100%	100%
	 	95%	95%	95%	105%	80%
	 	90%	90%	90%	110%	60%
	 	85%	85%	85%	115%	40%
	 	80%	80%	80%	120%	30%
	Min Acceptable	75%	75%	75%	125%	20%
	 	>75%	>75%	>75%	<125%	0%	0%

 

    	 

    	 

    
 

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	2011 Executive Incentive Plan	 

 

Exhibit 3

Sample Award Calculation

 

Assumptions:

Executive’s current salary is $200,000.

Targeted Plan award is 40% of salary or
80,000.

Targeted TEFG performance goals achieved:

•110% of Cash Flow target, providing
140% of targeted award segment;

•100% of Client Investment Results
target, providing 100% of targeted award segment;

•90% of Net New Client Money target,
providing 60% of targeted award segment;

•90% of Expenses as Percentage
of Revenue target, providing 140% of targeted award segment; and

•Plan Committee awards 100% of
targeted amount based on personal goal achievement;

•ROE as adjusted is 9.1%.

 

Calculations:

Current Salary:$200,000

Incentive Target Percent:x .40 

Incentive Target Amount:$80,000

	 	 	 	 	 	 	 	 
	A.Component for TEFG Cash Flow:	 	 	 	 	 	 
	        Incentive Target:	 	$80,000	 	 	 	 
	                Cash Flow Performance Adjustment: 	 	x 1.40	 	 	 	 
	                Non-weighted Cash Flow Allocation:	 	 	 	$112,000	 	 
	                Cash Flow Weighting:	 	 	 	    x .30 	 	 
	Weighted TEFG Cash Flow Component:	 	 	 	 	 	$33,600
	 	 	 	 	 	 	 
	B.Component for Client Investment Results (CIR):	 	 	 	 	 	 
	        Incentive Target:	 	$80,000	 	 	 	 
	                CIR Performance Adjustment: 	 	x 1.00	 	 	 	 
	                Non-weighted CIR Allocation:	 	 	 	$80,000	 	 
	                CIR Weighting:	 	 	 	    x .20 	 	 
	Weighted CIR Component:	 	 	 	 	 	$16,000
	 	 	 	 	 	 	 
	C.Component for Net New Client Money:	 	 	 	 	 	 
	        Incentive Target:	 	$80,000	 	 	 	 
	                New Client Money Performance Adjustment: 	 	x .60	 	 	 	 
	                Non-weighted New Client Money Allocation:	 	 	 	$48,000	 	 
	                New Client Money Weighting:	 	 	 	    x .20 	 	 
	Weighted Net New Client Money Component:	 	 	 	 	 	$9,600
	 	 	 	 	 	 	 
	D.Component for Non-Recurring & Extraordinary Item (NREI) Expense Ratio:
	        Incentive Target:	 	$80,000	 	 	 	 
	                NREI Performance Adjustment: 	 	x 1.40	 	 	 	 
	                Non-weighted NREI Allocation:	 	 	 	$112,000	 	 
	                NREI Weighting:	 	 	 	    x .10 	 	 
	Weighted NREI Expense Ratio Component:	 	 	 	 	 	$11,200
	 	 	 	 	 	 	 
	E.Component for Personal Goal (PG) Achievement:
	        Incentive Target:	 	$80,000	 	 	 	 
	                PG Performance Adjustment: 	 	x 1.00	 	 	 	 
	                Non-weighted PG Allocation:	 	 	 	$80,000	 	 
	                PG Weighting:	 	 	 	    x .20 	 	 
	Weighted Personal Goal Component:	 	 	 	 	 	$16,000
	 	 	 	 	 	 	 
	F.Total Plan Award:	 	 	 	 	 	$86,400
	 	 	 	 	 	 	 
	H.    Payout Schedule:	 	 	 	 	 	 
	        First Installment on March 31, 2012	 	 	 	$41,300	 	 
	        Second Installment on August 15, 2012: 	 	 	 	$21,600	 	 
	        Third Installment on November 30, 2012:	 	 	 	$21,600	 	 
	 	 	 	 	 	 	$86,4002011 EXECUTIVE AND KEY MANAGER RESTRICTED
STOCK UNIT SUB-PLAN

(Effective January 1, 2011)

 

This 2011 Executive and Key Manager Restricted
Stock Unit Sub-Plan (“Sub-Plan”) of The Edelman Financial Group Inc., a Texas corporation (the “Company”),
sets forth the rules and regulations adopted by the Committee for issuance of Performance Units in the form of Restricted Stock
Unit Awards under Section 3 and 4 of the Long-Term Incentive Plan (“Plan”). These rules and regulations shall apply
to Awards granted effective on and after January 1, 2011. In the event of any conflict between this Sub-Plan and the Plan, the
terms and conditions of the Plan shall control.

 

Section 1.Incorporation of Plan; Capitalized Terms.

 

The provisions of the Plan are hereby incorporated
herein by reference. Except as otherwise expressly set forth herein, this Sub-Plan shall be construed in accordance with the provisions
of the Plan and any capitalized terms not otherwise defined in this Sub-Plan shall have the definitions set forth in the Plan.
In the event of any conflict between this Sub-Plan and the Plan, the terms and conditions of the Plan shall control. The Committee
shall have final authority to interpret and construe the Plan and this Sub-Plan and to make any and all determinations thereunder,
and its decision shall be binding and conclusive upon all Participants and their legal representatives in respect of any questions
arising under the Plan or this Sub-Plan.

 

Section 2. Definitions

 

When used in this Sub-Plan, the following
terms shall have the meanings as set forth below, and are in addition to the definitions set forth in the Plan.

 

2.1“Account” means the account used
to record and track the number of Restricted Stock Units granted to each Participant as provided in Section 3.4.

 

2.2“Award” as used in this Sub-Plan
means each aggregate award of Restricted Stock Units as provided in Section 3.2.

 

2.3    “Date
of Grant” means March 15, 2012.

 

2.4    “Performance
Period” for purposes of this Sub-Plan means January 1, 2011 to December 31, 2011.

 

2.5“Performance Schedule”
means Attachment 1 to this Sub-Plan, which sets forth the Performance Measures applicable to this Sub-Plan.

 

2.6“Restricted Stock Unit” for purposes
of this Sub-Plan means each unit of an Award granted to a Participant that is denominated in Shares, each of which represents a
right to receive the value of a Share (or percentage of such value, which percentage may be higher than 100%) on the terms and
conditions set forth in the Plan and the Sub-Plan.

 

    	 

    	 

    
 

2.7“Salary” means the regular base
rate of compensation payable by the Company to a Participant on an annual basis. Salary does not include bonuses, if any, or incentive
compensation, if any. Such compensation shall not be reduced by any deferrals made under any other plans or programs maintained
by the Company.

 

2.8“Section 409A” means Section 409A
of the Code, or any successor section under the Code, as amended and as interpreted by final or proposed regulations promulgated
thereunder from time to time.

 

2.9“Year” means a calendar year.

 

Section 3. Participation and Awards

 

3.1 Participant
Selection. Participants under this Sub-Plan shall be selected by the Committee in its sole discretion.

 

3.2 Awards.
Subject to any adjustments to be made under Section 3.5, the Compensation Committee may, in its sole discretion, grant Awards to
some or all of the Participants in the form of a specific number of Restricted Stock Units. The target as a percentage of Salary
of the Awards granted for 2011 are as set forth on Attachment 2 hereto. The performance measures for the Sub-Plan are the same
as the performance measures for the 2011 Executive Incentive Plan of the Company.

 

3.3 Award
Valuation at Grant. In calculating the value of an Award for purposes of Section 3.2, the value of each Restricted Stock Unit
shall be equal to the closing price of a share of Stock on the last trading day on the Date of Grant. The Participant’s Salary
shall be determined as of the January 1 preceding the date the Award is granted, or such other time as is determined in the discretion
of the Committee. Each Award is deemed to be granted on the day that it is approved by the Committee.

 

3.4 Accounting
and Adjustment of Awards. The number of Restricted Stock Units awarded to a Participant shall be recorded in a separate Account
for each Participant. The number of Restricted Stock Units recorded in a Participant’s Account shall be adjusted to reflect
any splits or other adjustments in the Shares. Restricted Stock Units are bookkeeping entries only. A Participant shall have no
rights as a stockholder of the Company, no dividend rights and no voting rights with respect to the Restricted Stock Units. No
adjustments shall be made to any outstanding Awards for cash dividends paid on Shares during or after the Performance Period.

 

3.5 Restriction
Period, Vesting. A Participant’s rights with respect to the Restricted Stock Units shall remain subject to forfeiture
at all times prior to the date(s) on which the Restricted Stock Units vests pursuant to the Section 3.5. Except as provided in
Section 4, Restricted Stock Units subject to the Award shall vest and become non-forfeitable as follows:

 

25% on the date of Grant;

50% on the first anniversary of
the Date of Grant;

75% on the second anniversary of
the Date of Grant; and

100% on the third anniversary of
the Date of Grant.

 

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3.6Timing and Manner of Payment
of Restricted Stock Units. As soon as practicable after the date any Restricted Stock Units subject to the Award become
non-forfeitable (the “Payment Date”), such Restricted Stock Units shall be paid, at the Company’s option, (a) in
a lump sum cash payment equal in the aggregate to the Fair Market Value of a Share on the Payment Date multiplied by the number
of such Restricted Stock Units that become non-forfeitable upon that Payment Date or (b) by the Company delivering to the
Participant a number of Shares equal to the number of Restricted Stock Units that become non-forfeitable upon that Payment Date.
If the Restricted Stock Units are paid in Shares, the Company shall issue the Shares either (i) in certificate form or (ii) in
book entry form, registered in the name of the Participant. Delivery of any certificates will be made to the Participant’s
last address reflected on the books of the Company and its Subsidiaries unless the Company is otherwise instructed in writing.
Neither the Participant nor any of the Participant’s successors, heirs, assigns or personal representatives shall have any
further rights or interests in any Restricted Stock Units that are so paid. Notwithstanding anything herein to the contrary, the
Company shall have no obligation to issue Shares in payment of the Restricted Stock Units unless such issuance and such payment
shall comply with all relevant provisions of law and the requirements of any stock exchange upon which Shares are listed. Delivery
of any certificates will be made to the Participant’s last address reflected on the books of the Company unless the Company
is otherwise instructed in writing

 

3.7 Termination
of Employment. Excepts as otherwise provided in Section 4, in the event of the termination of a Participant’s
employment or service with the Company for any reason prior to the lapsing of the restrictions in accordance with Section 3.5 hereof
with respect to any of the Restricted Stock Units granted hereunder, such portion of the Restricted Stock Units held by the Participant
shall be automatically forfeited by the Participant as of the date of termination. Neither the Participant nor any of the Participant’s
successors, heirs, assigns, or personal representatives shall have any rights or interests in any Restricted Stock Units that are
so forfeited.

 

Section 4. Early Vesting and Forfeiture

 

4.1Termination during 2011.
Except as expressly set forth below, in the event a Participant’s employment with SMH terminates for any reason prior
to the end of the workday on December 31, 2011, such Participant will be ineligible for any Award under the Sub-Plan. In other
words, if a Participant is employed according to Company records through the end of the workday on December 31, 2011, the
Participant will, subject to the following provisions, be eligible for any award earned under the Sub-Plan for 2011.

    

Any Participant (or his or her estate) who
ceases to be employed by the Company prior to January 1, 2012, due to the Participant’s death, Disability, or Retirement
(as such terms are defined in the Plan), subject to the Participant’s execution of a waiver and release of claims in a form
and manner satisfactory to the Company, will be eligible to receive an Award based on an adjusted annual base salary amount, but
otherwise in the same manner, to the same extent, and at the same time as the Participant would have received such Award if such
Participant’s employment had continued through December 31, 2011 (i.e., based on achievement of applicable performance
measures). The Participant’s annual base salary will be the result of the following formula: X × Y/12, where:

 

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X = the Participant’s
annual base salary as in effect as of the date of termination of employment; and

Y = the number of calendar
months the Participant was actively employed by the Company during 2011, rounded up for any partial month.

 

4.2Termination on or after January 1,
2012.  Except as expressly set forth below, a Participant who ceases to be employed by SMH for any reason on or after
January 1, 2012, will forfeit any unvested Award. If any Participant (or his or her estate) who ceases to be employed by the Company
subsequent to December 31, 2011, but prior to expiration of the Restriction Period, due to the Participant’s death, Disability,
or Retirement, subject to the Participant’s execution of a waiver and release of claims in a form and manner satisfactory
to the Company, any outstanding Awards of the Participant shall immediately become vested. The Company shall issue to the Participant
all of the Shares remaining subject to the Restricted Stock Unit Award to the extent such Shares have vested in accordance with
this Section 4.2, upon the earliest of the following:

 

(i) as soon as practicable
but no later than 30 days following a Change in Control,

 

(ii) as soon as practicable
but no later than 90 days following the Participant’s death, or

 

(iii) the first business
day of the seventh month following the date of the Participant’s Retirement.

 

4.3Change in Control. In the case of a Change in
Control prior to March 15, 2012, the Company shall, subject to the restrictions in this Section 4.3 and Section 6.7 of the Plan,
irrevocably set aside Shares in one or more such grantor trusts in an amount that is sufficient to pay each Participant employed
by the Company, the net present value as of the date on which the Change in Control occurs, of the earned benefits to which Participants
would be entitled pursuant to the terms of the Sub-Plan. Any such trust shall be subject to the claims of the general creditors
of the Company in the event of bankruptcy or insolvency of the Company. Notwithstanding the foregoing provisions of this Section
4.3, the Company shall establish no such trust if the assets thereof shall be includable in the income of Participants thereby
pursuant to Section 409A(b). In the case of a Change in Control on of after March 15, 2012, all of the restrictions and conditions
of all Restricted Stock units then outstanding shall be deemed satisfied, and the Restriction Period with respect thereto shall
be deemed to have expired. Notwithstanding the foregoing, if and to the extent that any provision of this Sub-Plan or an Award
would cause a payment of deferred compensation that is subject to Section 409A(a)(2) of the Code to be made upon the occurrence
of a “Change in Control,” then such payment shall not be made unless such “Change in Control” satisfies
the requirements of Section 409A(2)(A)(v) of the Code and applicable regulations and rulings thereunder.

 

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4.4 Termination
of Employment. In the event that a Participant’s employment with the Company terminates for any reason other than as
provided in this Section 4, any Award made to the Participant which has not vested as provided in Section 3 shall be forfeited.

 

Section 5. Non-Assignability of Awards

 

The Awards and any right to receive payment
under the Plan and this Sub-Plan may not be sold, assigned, transferred, alienated, pledged, encumbered, otherwise disposed of,
or subject to any charge or legal process, except by will or the laws of descent and distribution, and if any attempt is made to
do so, or a Participant becomes bankrupt, then in the sole discretion of the Committee, any Award made to the Participant which
has not vested as provided in Sections 2 and 3 shall be forfeited.. Any attempt to dispose of any Restricted Stock Units in contravention
of the above restriction shall be null and void and without effect.

  

Section 6.No Right to Continued
Employment.

 

Nothing in the Plan or in this Sub-Plan
shall (a) confer on the Participant any right to continue in the employ of the Company; (b) affect the right of the Participant
or the Company to terminate the employment relationship at any time; (c) be deemed a waiver or modification of any provision
contained in any agreement between the Participant and the Company; (b) be construed as part of the Participant’s entitlement
to remuneration or benefit pursuant to a contract of employment or otherwise or as compensation for past services rendered; (e)
afford the Participant any rights or additional rights to compensation or damages as a consequence of the loss or termination of
his or her employment; or (f) entitle the Participant to any compensation or damages for any loss or potential loss he or she may
suffer by reason of being or becoming unable to vest in the Restricted Stock Units as a consequence of the loss or termination
of his or her employment with the Company.

 

Section 7.Adjustments.

 

In the event of a recapitalization,
reorganization, stock split, stock dividend, merger, consolidation, combination of shares or other change affecting the Shares
of the Company, the Committee shall make appropriate adjustments, if any, in the terms of this Sub-Plan, provided that such adjustments
shall be made in a manner that complies with the requirements of Section 409A of the Code. Any such adjustments shall be made in
accordance with the provisions of the Plan and shall be effective, final, binding and conclusive for all purposes of the Plan and
this Sub-Plan.

 

Section 8.Withholding of Taxes.

 

The
Company shall be entitled to take any of the following actions in order to satisfy tax withholding obligations arising on account
of amounts accrued or payable under this Sub-Plan: (a) deduct from any amount accrued or payable under this Sub-Plan an amount
equal to the federal, state, and local income taxes and other amounts as may be required by law to be withheld with respect thereto,
including withholding Shares issued in payment of the Restricted Stock Units having a Fair Market Value equal to the taxes that
the Company determines it is required to withhold under applicable tax laws with respect to the Restricted Stock Units (with such
withholding obligation determined based on any applicable minimum statutory withholding rates, (b) require the Participant to pay
to the Company such withholding taxes, or (c) deduct from any other compensation payable to the Participant the amount of any withholding
obligations with respect to amounts accrued or payable under this Sub-Plan. The Committee shall determine in its discretion which
of the above actions shall be taken in order to satisfy tax withholding obligations arising on account of amounts accrued or payable
under this Sub-Plan, including but not limited to withholding from amounts not otherwise payable at such time or attributable to
Shares not otherwise issuable at such time by accelerating the issuance of Shares, as permitted under Treasury Regulation Section 1.409A-3(j)(4)(vi);
provided, however, that in furtherance of satisfying such withholding obligations, the Participant shall have the right (by delivering
written notice to the Chief Financial Officer of the Company at the time and in the manner prescribed by the Committee) to have
a number of whole Shares withheld by the Company from the Shares to be issued upon distribution with a value not to exceed the
statutory minimum tax withholding obligation. The Participant and/or his or her beneficiary (including his or her estate) shall
bear all taxes on amounts paid under the Plan to the extent no taxes are withheld, irrespective of whether withholding is required.
For these purposes, the Fair Market Value of the Shares to be withheld
shall be determined on the date that the amount of tax to be withheld is to be determined.

 

    	5

    	 

    

Section 9. Amendment and Termination

 

This Sub-Plan shall be subject to amendment, suspension, or
termination as provided in the Plan. No action to amend, suspend or terminate this Sub-Plan shall permit the acceleration of the
time or schedule of the payment of any Award granted under this Sub- Plan (except as provided in regulations under Section 409A).

 

Section 10.Unfunded Award.

 

The Restricted Stock Unit Awards
represent an unfunded, unsecured right to receive Shares and cash in accordance with the terms of this Sub-Plan, and the Company
shall not be required to segregate any assets with respect to any amounts or Share issuances due in connection with this Sub-Plan.

 

Section 11.Compliance with Code Section 409A.

 

Notwithstanding anything to the contrary
contained herein, this Sub-Plan is intended to be in full compliance with the requirements of, and thereby avoid any tax arising
pursuant to, Section 409A of the Code. Accordingly, all provisions herein, or incorporated by reference, shall be construed and
interpreted in a manner consistent with such intent.

 

Section 12. Miscellaneous

 

12.1Notices. Any and all
notices, designations, consents, offers, acceptances and any other communications provided for herein shall be given in writing
and shall be delivered either personally or by registered or certified mail, postage prepaid, which shall be addressed, in the
case of the Company to both the Chief Financial Officer and the General Counsel of the Company at the principal office of the Company
and, in the case of a Participant, to the Participant’s address appearing on the books of the Company or to the Participant’s
residence or to such other address as may be designated in writing by the Participant.

 

    	6

    	 

    
 

12.2Successors. The terms
of this Sub-Plan shall be binding upon and inure to the benefit of the Company, its successors and assigns, and of each Participant
and the beneficiaries, executors, administrators, heirs, and successors of the Participant.

 

12.3Invalid Provision.
The invalidity or unenforceability of any particular provision thereof shall not affect the other provisions hereof, and this
Sub-Plan shall be construed in all respects as if such invalid or unenforceable provision had been omitted.

 

12.4Governing Law. This
Sub-Plan and the rights of the Participant hereunder shall be construed and determined in accordance with the laws of the State
of Texas.

 

12.5Headings. The headings
of the Sections hereof are provided for convenience only and are not to serve as a basis for interpretation or construction, and
shall not constitute a part, of this Sub-Plan.

 

12.6Resolution of Disputes.
Any dispute or disagreement which may arise under, or as a result of, or in any way relate to, the interpretation, construction
or application of this Agreement shall be resolved by the Committee. Any resolution made hereunder by the Committee shall be effective,
final, binding and conclusive on the Participant and the Company for all purposes.

 

    	7

    	 

    

Attachment 1

  

Proposed 2011 Performance Goals and Weights

Versus Award Opportunity Earned

	Level of Performance Achievement	Adjusted Cash Flow from Operations	Client Investment Results	Net New Client Money	Expenses as Percentage of Revenue	%  of Target Award Earned	Discretionary
	 	 	 	 	 	 	 
	(Weight)	(30%)	(20%)	(20%)	(10%)	 	(20%)
	 	 	 	 	 	 	 
	Target	100%	100%	100%	100%	100%	100%
	 	95%	95%	95%	105%	80%	
	 	90%	90%	90%	110%	60%
	 	85%	85%	85%	115%	40%
	 	80%	80%	80%	120%	30%
	Min Acceptable	75%	75%	75%	125%	20%
	 	<75%	<75%	<75%	>125%	0%	0%

 

    	8

    	 

    

Attachment 2

 

Proposed 2011 Participants and Award
Targets

 

	Title	Targeted Award
	Chairman/Chief Executive Officer	175% of salary
	President	175% of salary
	EFS Chairman/Chief Executive Officer	175% of EFS salary
	SMH EVP High Net Worth	150% of salary
	Corporate Chief Financial Officer	150% of salary
	Chief Information Officer	150% of salary
	Chief Operations	150% of salary
	EVP Corporate	150% of salary
	Legal Counsel	120% of salary
	SMH Controller	40% of salary
	EFS Chief Financial Officer (with Division responsibility)	40% of salary
	SMH Chief Compliance Officer	35% of salary
	EFS Chief Compliance Officer	35% of salary
	Vice President Information Technology	35% of salary
	Chief Technology Officer	35% of salary
	Director, Financial Reporting	35% of salary
	SVP Operations	20% of salary
	SMH Administrative Manager	20% of salary
	VP Human Resources	20% of salary
	VP Human Resources/Training	20% of salary
	VP Marketing & Communication	30% of salary
	SVP Operations	20% of salary
	VP Operations	20% of salary
	Administrative Manager	20% of salary

 

 

    	9

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