SECOND AMENDMENT TO EMPLOYMENT
AGREEMENT
THIS SECOND
AMENDMENT (the “Second Amendment”) is entered into by
and between Penni F. Roll, (“you”) and Allied Capital
Corporation, a Maryland corporation (the “Company”), on
December 15, 2008. This Second Amendment shall be effective
for all purposes as of December 15, 2008 (the “Effective
Date”).
WHEREAS, you and
the Company entered into an employment agreement effective as of
January 1, 2004 (“Employment
Agreement”);
WHEREAS, the
Employment Agreement was amended effective March 29, 2007 (the
“First Amendment”) to comply with Section 409A of
the Internal Revenue Code of 1986 and address other related tax
issues;
WHEREAS, the
Employment Agreement and the First Amendment, together, shall be
referred to as the “2007 Employment
Agreement;”
WHEREAS final
regulations implementing Section 409A have been issued since
the First Amendment became effective; and
WHEREAS, the
parties are amending the 2007 Employment Agreement for their mutual
benefit to comply with Section 409A and its implementing
regulations and address other related issues;
NOW THEREFORE, for
good and valuable consideration the receipt and sufficiency of
which are hereby acknowledged, you and the Company, intending
legally and equitably to be bound, hereby amend the 2007 Employment
Agreement as follows:
1. You and the
Company hereby delete in its entirety Section 7(c) of the 2007
Employment Agreement and substitute the following language in its
place:
(c) In the event
that the Company terminates your employment without Cause, or you
terminate your employment for Good Reason or your employment
terminates due to your death or Disability, or the Term expires in
accordance with this Agreement after the delivery of a Non-renewal
Notice by either party, you (or your personal or legal
representatives) shall receive a termination payment equal to the
amount of $43,500 to be paid on the later of (A) the first
business day following the expiration of six months after your
Separation from Service, or (B) ten (10) days after you
(or in the event of your death, your personal or legal
representative) deliver to the Company the Release, regardless of
whether the Company has signed the Release. Such amount shall be
increased by ten percent (10%) annually on the anniversary of the
effective date of this Second Amendment. Such payment shall be in
lieu of certain post-termination health and welfare
benefits.
