AMENDED AND RESTATED 2005 ALLIED CAPITAL CORPORATION NON-QUALIFIED DEFERRED COMPENSATION PLAN Effective December 14, 2007 1 AMENDED AND RESTATED 2005 ALLIED CAPITAL CORPORATION NON-QUALIFIED DEFERRED COMPENSATION PLAN Table of Contents

EXHIBIT 10.1

AMENDED AND RESTATED
2005 ALLIED CAPITAL CORPORATION
NON-QUALIFIED DEFERRED COMPENSATION PLAN

Effective December 14, 2007

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AMENDED AND RESTATED
2005 ALLIED CAPITAL CORPORATION
NON-QUALIFIED DEFERRED COMPENSATION PLAN

Table of Contents

Page

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Table of Contents (continued)

APPENDIX A

Companies that have adopted the Plan 13

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AMENDED AND RESTATED
2005 ALLIED CAPITAL CORPORATION
NON-QUALIFIED DEFERRED COMPENSATION PLAN

PREAMBLE

WHEREAS, the Employer recognizes the unique qualifications of its Executives, employees, Directors and Consultants and the valuable services that they have provided to or for the Employer; and

WHEREAS, the Employer has previously adopted the amended and restated Non-Qualified Deferred Compensation Plan of Allied Capital Corporation, which plan was frozen to new deferrals effective December 31, 2004, in order to provide retirement benefits to its Executives and employees based upon compensation earned by them in excess of the compensation limit imposed on qualified retirement plans by section 401(a)(17) of the Internal Revenue Code and without regard to the limitation on benefits or contributions under section 415 of the Internal Revenue Code and to allow its Executives, Directors and Consultants to defer compensation that would otherwise be paid to them for purposes of saving for retirement; and

WHEREAS, the Employer has previously adopted the 2005 Non-Qualified Deferred Compensation Plan of Allied Capital Corporation (the “Plan”) in order to be compliant with the requirements of new Section 409A of the Internal Revenue Code, effective as of January 1, 2005; and

WHEREAS, the Employer desires to amend and terminate the Plan;

NOW, THEREFORE, in consideration of the premises and of the provisions hereinafter set forth, the Plan shall be and hereby is amended and restated, effective December 14, 2007, as follows:

ARTICLE I
GENERAL

Section 1.1 Effective Date. The provisions of this Plan shall be effective as of January 1, 2005. The rights, if any, of any person whose status as an employee, Executive, Director or Consultant of the Employer terminates shall be determined pursuant to the Plan as in effect on the date such employee, Executive, Director or Consultant terminates, unless a subsequently adopted provision of the Plan is made specifically applicable to such person.

Section 1.2 Purpose. The purpose of the Plan is to provide retirement income to Executives and employees based upon their compensation from the Company in excess of the amount of compensation that may be taken into account by a qualified retirement plan described in section 401(a) of the Code and without regard to the limitation on benefits or contributions under section 415 of the Code.

The Plan shall also provide Executives, Directors and certain Consultants with the opportunity to defer receipt of amounts otherwise payable by the Company.

Section 1.3 Intent. The Plan is intended to be an unfunded plan for the purpose of providing deferred compensation to a select group of management or highly compensated employees as such group is described under Sections 201(2), 301(a)(3), and 401(a)(1) of ERISA, and a select group of consultants. The Plan is not intended to be a plan described in Section 401(a) of the Code. The obligation of the Company to make payments under this Plan constitutes nothing more than an unsecured promise of the Company to make such payments, and any property of the Company that may be set aside for the payment of benefits under the Plan shall, in the event of the Company’s bankruptcy or insolvency, remain subject to the claims of the Company’s general creditors until such benefits are distributed in accordance with Article V herein.

ARTICLE II
DEFINITIONS AND USAGE

Section 2.1 Definitions. Wherever used in the Plan, the following words and phrases shall have the meaning set forth below unless the context plainly requires a different meaning:

“Account” means the account established on behalf of each Participant as described in Section 4.2 of the Plan.

“Administrator” means the Compensation Committee of the Board, or such other person or persons as designated by the Board.

“Beneficiary” means those persons designated as a Beneficiary by the Participant.

“Board” means the Board of Directors of Allied Capital Corporation.

“Bonus” means any amount paid to an Executive which is designated by the Employer as an annual bonus, or any amount paid to a Consultant or Director.

“Bonus Deferral Election” means an election made pursuant to Section 4.4(b) of the Plan.

“Change in Control” of the Company is defined in Section 8.2 of the Plan.

“Code” means the Internal Revenue Code of 1986, as amended from time to time.

“Company” means Allied Capital Corporation, AC Corporation, and any named subsidiaries or related parties adopting the Plan as listed in Appendix A hereto or any successor thereto.

“Compensation” means “Compensation” as defined under the Retirement Plan. However, for purposes of this Plan, “Compensation” shall not include Bonuses and shall be determined without regard to the limitations imposed by Code Section 401(a)(17).

“Compensation Committee” means the Compensation Committee of the Board of Directors of Allied Capital Corporation.

“Compensation Deferral Election” means an election made pursuant to Section 4.4(a) of the Plan.

“Consultant” means any individual providing services for the Employer in a capacity other than as a common law employee of the Employer.

“Deferral Agreement” means an agreement entered into between an Executive, a Director or a Consultant and the Employer for the purposes set forth in Articles IV and V.

“Director” means any member of the Board of Directors of Allied Capital Corporation who is not also an Executive.

“Disability” means the Participant’s inability to engage in any substantial gainful activity by reason of any medically determinable physical or mental impairment which can be expected to result in death or can be expected to last for a continuous period of not less than twelve (12) months, or by reason of any medically determinable physical or mental impairment which can be expected to result in death or can be expected to last for a continuous period of not less than twelve (12) months, receiving income replacement benefits for a period of not less than three (3) months under an accident and health plan covering employees of the Employer. A Participant who incurs a Disability shall be deemed to have a Termination of Employment with the Employer at the time that the Administrator reasonably determines the Participant has incurred a Disability.

“Employer” means Allied Capital Corporation, AC Corporation, and any named subsidiaries or related parties adopting the Plan as listed in any Appendix A hereto or any successor hereto.

“Executive” means any common law employee of the Employer having attained the status of an officer of at least the Senior Vice President level in the Company and any employee of the Employer with an Account balance in the Prior Plan as of January 30, 2004.

“ERISA” means the Employee Retirement Income Security Act of 1974, as amended from time to time.

“Excess Recognized Compensation” means the excess, if any, of an employee’s or Executive’s recognized Compensation and Bonus for the Plan Year over the $210,000 limit (as adjusted from time to time for cost of living increases) of Section 401(a)(17) of the Code but without any reduction to reflect amounts deferred under this Plan.

“Participant” means any eligible Consultant of the Employer, Director, eligible Executive, or employee who has Excess Recognized Compensation in any Plan Year, who has been designated by the Compensation Committee as a Participant in the Plan, or a person who was such a Participant at the time of his Termination of Employment, death, or upon a Change in Control, or a Beneficiary who is presently entitled to benefits under the Plan in accordance with its terms.

“Plan” means this 2005 Allied Capital Corporation Non-Qualified Deferred Compensation Plan, as adopted effective January 1, 2005 and as amended from time to time.

“Plan Benefit” means the benefit of a Participant as determined under Article IV of the Plan.

“Plan Year” means the calendar year.

“Prior Plan” means the Allied Capital Corporation Non-Qualified Deferred Compensation Plan, as amended and restated as of January 30, 2004 and as frozen to any new deferrals effective December 31, 2004.

“Retirement Plan” means the Allied Capital 401(k) Plan.

“Termination of Employment” for an employee means separation from service with the Employer as a result of resignation, involuntary discharge, Disability, or death; for a Consultant means the termination of all contracts with the Employer; and for a Director means his resignation from or other termination of his membership on the Board.

“Trust” means a trust which may be established by the Employer in accordance with Article IX to provide the benefits described in this Plan.

“Trustee” means the corporation or individual(s) selected by the Employer to serve as trustee for the Trust.

Section 2.2 Usage. Except where otherwise indicated by the context, any masculine terminology used herein shall also include the feminine and vice versa, and the definition of any term herein in the singular shall also include the plural and vice versa.

ARTICLE III
ELIGIBILITY AND PARTICIPATION

Section 3.1 Eligibility. For purposes of making a deferral election pursuant to Section 4.4, any Executive, Director or Consultant of the Employer shall be eligible to participate in the Plan at such time and for such period as designated by the Compensation Committee.

For purposes of receiving an Employer contribution pursuant to Section 4.5, any Executive or employee with Excess Recognized Compensation is eligible to participate in the Plan at such time and for such period as designated by the Compensation Committee.

Notwithstanding the above, all Participants must be members of a select group of management or highly compensated employees as such group is described under sections 201(2), 301(a)(3), and 401(a)(1) of ERISA, as interpreted by the Department of Labor or a court of competent jurisdiction.

Section 3.2 Participation. An employee, Executive, Director or Consultant who is eligible to participate in the Plan pursuant to Section 3.1 shall become a Participant at such time and for the period so designated by the Compensation Committee. The participation of any Participant may be suspended or terminated by the Compensation Committee, at any time; provided, however, that for any Participant who has entered into a Deferral Agreement, a suspension or termination shall not apply to that Deferral Agreement until the first day of the Plan Year next following the Compensation Committee’s action unless the Plan is terminated pursuant to Section 5.11. Additionally, the participation of any Participant may be terminated if the Participant has received a hardship distribution upon an unforeseeable emergency as defined in Section 5.10, or if termination is required for the Participant to obtain a hardship distribution under a 401(k) Plan An employee, Executive, Director or Consultant shall cease to be a Participant upon his Termination of Employment with the Company and when the balance in his Account has been distributed to him or on his behalf.

If, at any time, an Executive or an employee is determined or reasonably believed, based on a judicial or administrative determination or opinion of counsel, not to qualify as “management” or a “highly compensated employee” under ERISA Sections 201(2), 301(a)(3), and 401(a)(1), the Executive or employee shall cease to be eligible for Employer contributions as of the date of that determination and any Compensation or Bonus Deferral Election shall cease as of the first day of the Plan Year next following the date of that determination. Notwithstanding the foregoing, the Plan Benefit to which he is entitled shall only be distributed to him in accordance with the provisions of Article V of the Plan.

Section 3.3 Termination of Participation. During the first Plan Year, a Participant who has made a deferral election for that Plan Year may make an election to cancel such deferral election, terminate participation in the Plan, and receive a distribution of his Account in accordance with Q&A 20 of Internal Revenue Service Notice 2005-1 or a payment election in accordance with Q&A 19(c) of Notice 2005-1, subject to the approval of the Compensation Committee.

ARTICLE IV
PLAN BENEFIT

Section 4.1 Plan Benefit. A Participant’s Plan Benefit shall be equal to the total amount credited to the Participant’s Account under this Article IV. Such Plan Benefit shall become nonforfeitable and payable to the Participant as provided under Article V.

Section 4.2 Accounts. For each Participant, the Company shall establish and maintain a Participant Account on the books of the Company. All amounts which are credited to the Account shall be credited solely for purposes of accounting and computation, and shall remain assets of the Employer subject to the claims of the Employer’s general creditors. A Participant’s Account shall be reduced by an amount equal to any Plan Benefit previously distributed to him pursuant to Article V.

Section 4.3 Multiple Accounts. At the discretion of the Administrator, a Participant may have more than one account, as in the case of a former Executive who may again have become a Participant as a result of serving in the capacity of a Consultant. Credits to each such Account shall be determined by deferral elections made under separate Deferral Agreements, as described in Section 4.4 of the Plan. The determination as to the period for the commencement of the distribution of Plan Benefits under Article V of the Plan shall be made separately with respect to each such Account.

Section 4.4 Deferral Agreement. To be eligible to make a Deferral Election under the terms of this Plan, an Executive, a Director or a Consultant, with the consent of the Company, shall enter into a Deferral Agreement setting forth the amount or percentage of eligible Compensation, Bonuses or other amounts to be deferred. The Deferral Agreement must be made prior to the Plan Year in which the eligible Compensation, Bonuses or other amounts to be deferred will be earned. For each Plan Year, each eligible Executive, Director or Consultant may make the following deferral elections:

Section 4.5 Employer Contributions. The Employer, in its discretion, from time to time, shall credit to the Account of each Executive or employee with Excess Recognized Compensation that portion of the contribution attributable to his or her Excess Recognized Compensation that would have been made to the Retirement Plan but for the application of Code Section 401(a)(17). The Employer may also credit such sums to Participants’ Accounts under the Plan from time to time as it deems appropriate.

Section 4.6 Investment Procedure. The Employer and each Participant may, at the discretion of the Employer, execute an agreement which reflects the deemed investment of the portion of the Participant’s Account which shall be applied to the payment of the Participant’s Plan Benefit under the Plan. The Administrator shall retain overriding discretion over the selection of investment vehicles that the Participant may elect pursuant to such an agreement, and the Administrator may change, alter or modify its investment policy as it deems appropriate, from time to time. Any such change, alteration or modification shall be communicated to the Participants under procedures adopted by the Administrator.

Section 4.7 Valuation of Accounts. The value of a Participant’s Account shall be determined from time to time by the Administrator in the following manner.

Section 4.8 No Additional Contributions. Notwithstanding the foregoing, no contributions pursuant to Deferral Elections and no additional Employer contributions may be made to the Plan after December 31, 2007.

ARTICLE V
VESTING AND DISTRIBUTION

Section 5.1 Vesting. Amounts credited or paid to the Plan shall at all times be 100% vested and non-forfeitable.

Section 5.2 Distributable Events. Except as otherwise provided in this Plan, a Participant’s Plan Benefit shall become distributable upon the earliest of one of the following events:

Subject to Section 5.7, a Participant may specify a future determined date on which his Plan Benefit shall become distributable in a Plan Benefit and Payment Commencement Agreement. The date specified shall be at least two years from the date the agreement is signed, and the agreement must be completed and signed prior to the beginning of the first Plan Year in which the Compensation or Bonus to be deferred will be earned, or, for newly eligible Participants, within thirty days of their eligibility date. Once a Participant has elected to specify or forego specifying a future determined date, the election is effective for the entirety of the Participant’s Account and may not be modified. However, in the event that an individual continues as a Participant after the date specified in his initial agreement, he may complete and sign an agreement specifying either a future determined date as of which subsequent deferrals shall be distributable or that subsequent deferrals shall be distributable upon his Termination of Employment. The agreement relating to the subsequent deferrals shall be effective for any deferrals made pursuant to a Compensation or Bonus Deferral Election and any Employer contributions for the next Plan Year beginning after the date the subsequent agreement is completed and signed and subsequent Plan Years, shall apply to the Participant’s entire Account, and may not be modified once made.

Section 5.3 Amount of Plan Benefits. A Participant’s Plan Benefit shall equal the total amount credited to the Participant’s Account in accordance with Article IV.

Section 5.4 Plan Benefit Payment Options. Prior to the beginning of the first Plan Year in which the Compensation or Bonus to be deferred will be earned, or, for newly eligible Participants, within thirty days of their eligibility date, and subject to the provisions of Section 5.7, a Participant may elect one of the following Plan Benefit payment options. Once a payment option has been elected, the election is effective for the entirety of the Participant’s Account and may not be modified.

Notwithstanding the preceding provisions of this Section 5.4, if a Participant’s Plan Benefit account balance is $50,000 or less at the time of a distributable event, he or she must receive the Plan Benefit in a lump sum payment.

Section 5.5 Timing of Benefit Payments. Upon the occurrence of the earliest of the distributable events described in Section 5.2, a Participant will, subject to Section 10.1, receive a distribution of his Plan Benefit in accordance with the following provisions.

Notwithstanding the foregoing, if a Participant has elected to terminate participation in accordance with Section 3.3, any amounts credited to the Participant’s Account shall be immediately payable to him without regard to the provisions regarding Timing of Benefit Payments, subject to the approval of the Compensation Committee.

Section 5.6 Form of Benefit Payments. Plan Benefits will be paid in the form of cash; provided, however, that the Trustee shall be authorized to make provision for the reporting and withholding of any federal, state or local taxes that may be required to be withheld and paid by the Company.

Section 5.7 Plan Benefit Payment Election Procedures. For purposes of making the elections provided in Sections 5.2 and 5.4, each Participant shall be provided with an election form prepared by the Administrator. If an election form is not properly executed as provided herein, the Participant will be deemed to have elected to receive his or her Plan Benefits upon Termination of Employment in a lump sum.

Section 5.8 Form of Benefit Payments Upon Death. Upon the death of a Participant who has not yet received a distribution of all benefits under this Plan, the Participant’s Beneficiary or Beneficiaries shall receive the remaining Plan Benefit in a single lump-sum, payable as soon as administratively feasible.

Section 5.9 Designation of Beneficiary. A Participant may, on such form as may be provided by the Administrator, designate one or more primary and contingent Beneficiaries to receive the Plan Benefit which may be payable hereunder following the Participant’s death, and may designate the proportions in which such Beneficiaries are to receive such payments. A Participant may change such designations from time to time, and the last written designation filed with the Administrator prior to the Participant’s death shall control. If a Participant fails to specifically designate a Beneficiary or, if no designated Beneficiary survives the Participant, payment shall be made to the Participant’s estate in a single lump-sum, notwithstanding any other provision of this Plan.

Section 5.10 Hardship Distributions. A distribution in an amount no greater than a Participant’s Account balance may be made to, and at the election of, a Participant in the event of an unforeseeable emergency. An unforeseeable emergency is defined as a severe financial hardship to the Participant resulting from an illness or accident of the Participant, the Participant’s spouse, or a dependent (as defined in Code Section 152(a)) of the Participant, loss of the Participant’s property due to casualty, or other similar extraordinary and unforeseeable circumstances arising as a result of events beyond the control of the Participant. The determination as to what constitutes an unforeseeable emergency shall be made by the Compensation Committee.

The following restrictions apply to a Participant who receives a hardship distribution: (a) the distribution may not exceed the amount necessary to satisfy the Participant’s emergency (including any amounts necessary to pay any federal, state or local income taxes or penalties reasonably anticipated to result from the distribution); and (b) the Participant must have obtained all distributions, other than hardship distributions, and all nontaxable loans (determined at the time of the loan) currently available under all qualified plans maintained by the Employer. A hardship distribution on account of an unforeseeable emergency shall be made from this Plan prior to any hardship withdrawal made from the Retirement Plan.

Section 5.11 Termination of the Plan. The Plan shall be terminated effective March 18, 2008, and, as permitted in the transition relief set forth in IRS Notice 2006-79, as modified and superseded by IRS Notice 2007-86, any amounts credited to the Account of a Participant which are not distributed under the terms of the Plan during the Plan Year ending December 31, 2007 shall be distributed in full to such Participant (or Beneficiary, if the Participant is deceased) on March 18, 2008.

ARTICLE VI
ADMINISTRATION

Section 6.1 General. Except as otherwise specifically provided in the Plan, the Administrator shall be responsible for administration of the Plan. The Administrator shall be the “named fiduciary” within the meaning of Section 402(c)(2) of ERISA. The Administrator, in the exercise of its discretion, may delegate to any employee or employees of the Company the authority to act as the Administrator’s agent with respect to any matter within the control of the Administrator, provided that such delegation of authority shall be subject to revocation by the Administrator. Any act that the Administrator is required or authorized to perform under the terms of this Plan, including any communication to be made or received by the Administrator, may be performed by an agent of the Administrator, provided such person is acting within the scope of that person’s delegation of authority from the Administrator.

Section 6.2 Administrative Rules. The Administrator may adopt such rules of procedure as it deems desirable for the conduct of its affairs, except to the extent that such rules conflict with the provisions of the Plan.

Section 6.3 Duties. The Administrator shall have the following rights, powers and duties:

Section 6.4 Fees. No fee or compensation shall be paid to any person for services as the Administrator.

ARTICLE VII
CLAIMS PROCEDURE

Section 7.1 General. Any claim for Plan Benefits under the Plan shall be filed by the claimant on the form prescribed for such purpose with the Administrator.

Section 7.2 Denials. If a claim for Plan Benefits under the Plan is wholly or partially denied, notice of the decision shall be furnished to the claimant by the Administrator within sixty days after receipt of the claim by the Administrator, unless special circumstances require an extension of time of sixty days (for a total of 120 days).

Section 7.3 Notice. Any claimant who is denied a claim for Plan Benefits shall be furnished written notice setting forth:

Section 7.4 Appeals Procedure. In order that a claimant may appeal a denial of a claim, the claimant or the claimant’s duly authorized representative may:

Section 7.5 Review. A decision on review of a denied claim shall be made by the Administrator not later than sixty days after receipt of a request for review, unless special circumstances require an extension of time for processing, in which case a decision shall be rendered within a reasonable period of time, but not later than 120 days after receipt of a request for review. The decision on review shall be in writing and shall include the specific reason(s) for the decision and the specific reference(s) to the pertinent provisions of the Plan on which the decision is based.

ARTICLE VIII
CHANGE IN CONTROL

Section 8.1. In General. In the event of a “Change in Control” as defined in Section 8.2 of the Plan, all amounts in all Participant Accounts will be distributed to the Participants in Accordance with Article V.

Section 8.2. Definition of “Change in Control”. A “Change in Control” means (i) the sale or other disposition of at least forty percent (40%) of the Company’s assets; or (ii) the acquisition, whether directly, indirectly, beneficially (within the meaning of Rule 13d-3 of the 1934 Act), or of record, as a result of a merger, consolidation or otherwise, of securities of the Company representing 50 percent (50%) or more of the total fair market value or aggregate voting power of the Company’s then outstanding common stock by any person (within the meaning of Section 13(d) and 14(d) of the 1934 Act), including, but not limited to, any corporation or group of persons acting in concert, other than (A) the Company or its subsidiaries and/or (B) any employee pension benefit plan (within the meaning of Section 3(2) of the Employee Retirement Income Security Act of 1974) of the Company or its subsidiaries, including a trust established pursuant to any such plan; or (iii) the individuals who were members of the Board as of the Effective Date (the “Incumbent Board”) cease to constitute at least two-thirds (2/3) of the Board; provided, however, that any director appointed by at least two-thirds (2/3) of the then Incumbent Board or nominated by at least two-thirds (2/3) of the Nominating Committee of the Board (if a majority of the members of the Nominating Committee are then Incumbent Board or appointees thereof), other than any director appointed or nominated in connection with, or as a result of, a threatened or actual proxy or control contest, shall be deemed to constitute a member of the Incumbent Board.

ARTICLE IX
TRUST

Section 9.1 Trust. A trust to be known as the Allied Capital Corporation Deferred Compensation Trust (the “Trust”) has been established by the execution of a Trust agreement with one or more Trustees and is intended to be maintained as a “grantor trust” under Code Section 677. The assets of the Trust will be held, invested and disposed of by the Trustee, in accordance with the terms of the Plan and the terms of the Trust, for the purpose of providing Plan Benefits for the Participants. Notwithstanding any provision of the Plan or the Trust to the contrary, the assets of the Trust shall at all times be subject to the claims of the Employer’s general creditors in the event of insolvency or bankruptcy.

Section 9.2 Contributions and Expenses. The Employer, in its sole discretion, and from time to time, may make contributions to the Trust. All Plan Benefits under the Plan and expenses chargeable to the Plan, to the extent not paid directly by the Employer, shall be paid from the Trust.

Section 9.3 Trustee Duties. The powers, duties and responsibilities of the Trustee shall be as set forth in the Trust agreement and nothing contained in the Plan, either expressly or by implication, shall impose any additional powers, duties or responsibilities upon the Trustee.

Section 9.4 Reversion to the Employer. Subject to Sections 1.3 and 9.1, the Employer shall have no beneficial interest in the Trust and no part of the Trust shall ever revert or be repaid to the Employer, directly or indirectly.

ARTICLE X
MISCELLANEOUS PROVISIONS

Section 10.1 Modification, Amendment, Discontinuance, and Termination. The Board retains the right to modify or amend the Plan at any time and from time to time and the right to discontinue or terminate the Plan at any time and from time to time; provided, however, that no modification, amendment, discontinuance or termination shall adversely affect the rights of Participants and Beneficiaries to receive amounts credited to the Accounts maintained on their behalf before such modification, amendment, discontinuance or termination. Notice of every such modification, amendment, discontinuance or termination shall be given in writing to each Participant and to each Beneficiary then entitled to Plan Benefits. In the case of termination of the Plan, any amounts credited to the Account of a Participant shall be distributed in full to such Participant (or Beneficiary, if the Participant is deceased) in accordance with the provisions of Section 5.11 of the Plan.

Section 10.2 No Assignment. The Participant shall not have the power to pledge, transfer, assign, anticipate, mortgage or otherwise encumber or dispose of in advance any interest in amounts payable hereunder or any of the payments provided for herein, nor shall any interest in amounts payable hereunder or in any payments be subject to seizure for payments of any debts, judgments, alimony or separate maintenance, or be reached or transferred by operation of law in the event of bankruptcy, insolvency or otherwise, other than by will or the laws of intestacy.

Section 10.3 Successors and Assigns. The provisions of the Plan are binding upon and inure to the benefit of the Employer, its successors and assigns, and the Participant, his Beneficiaries, heirs, legal representatives and assigns.

Section 10.4 Governing Law. The Plan shall be subject to and construed in accordance with the laws of the State of Maryland to the extent not preempted by the provisions of ERISA.

Section 10.5 No Guarantee of Employment. Nothing contained in the Plan shall be construed as a contract of employment or deemed to give any Participant the right to be retained in the employ of an Employer or any equity or other interest in the assets, business or affairs of the Employer.

Section 10.6 Severability. If any provision of the Plan shall be held illegal or invalid for any reason, such illegality or invalidity shall not affect the remaining provisions of the Plan, but the Plan shall be construed and enforced as if such illegal or invalid provision had never been included herein.

Section 10.7 Notification of Addresses. Each Participant and each Beneficiary shall file with the Administrator, from time to time, in writing, the post office address of the Participant, the post office address of each Beneficiary, and each change of post office address. Any communication, statement or notice addressed to the last post office address filed with the Administrator (or if no such address was filed with the Administrator, then to the last post office address of the Participant or Beneficiary as shown on the Employer’s records) shall be binding on the Participant and each Beneficiary for all purposes of the Plan and neither the Administrator nor the Employer shall be obligated to search for or ascertain the whereabouts of any Participant or Beneficiary.

Section 10.8 Bonding. The Administrator and all agents and advisors employed by it shall not be required to be bonded, except as otherwise required by ERISA.

The undersigned, pursuant to the approval of the Board, does hereby execute this Amended and Restated 2005 Allied Capital Corporation Non-Qualified Deferred Compensation Plan on this 14^th day of December, 2007.

Allied Capital Corporation

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Appendix A

Companies that have adopted the Plan

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