EMPLOYMENT AGREEMENT
THIS EMPLOYMENT AGREEMENT (the "Agreement") is made and
entered into as of the 12th day of June, 1998, by and between
▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇, a resident of the State of Florida
("Executive"), and JWGENESIS FINANCIAL CORP., a Florida
corporation (the "Company").
1. DUTIES AND EXTENT OF SERVICES
1.1 POSITION AND DUTIES. The Company hereby enters into
this Agreement to evidence and provide for the employment of
Executive as Chairman of the Board, Chief Executive Officer, and
President of the Company. Consistent with the policies,
guidelines, and directives established or promulgated by the
Board of Directors of the Company (the "Board"), Executive shall
be in complete charge of all operations of the Company, with
authority and responsibility for formulating and directing the
implementation of policies for the management of such operations.
Executive shall only be required to report directly to the Board.
Executive agrees to serve, without additional compensation, in a
similar executive capacity with subsidiaries of the Company and
in such other executive capacities as may be designated by the
Board consistent with the positions, responsibilities, and
authority of Executive hereunder.
1.2 EXTENT OF SERVICES. Executive agrees to devote his
full working time, energy, and skill to the business of the
Company and to the promotion of the Company's interests and to
discharge his duties in good faith.
2. TERM
The term of this Agreement (the "Term") shall commence on
June 12, 1998 and shall continue to December 31, 2001, and shall
be automatically renewed for successive one-year terms unless
either party notifies the other in writing of its election not to
renew at least six months prior to the scheduled termination of
the Term or any renewal term. This Agreement may be earlier
terminated only in accordance with Section 7 hereof.
3. COMPENSATION
3.1 BASE SALARY. The Company shall pay Executive a base
annual salary (the "Base Salary") of Five Hundred Thousand
Dollars ($500,000.00) for each fiscal year during the Term
(prorated for any partial fiscal year), subject, however, to
increase for each fiscal year beginning January 1, 1999 by (a) an
amount equal to the increase for the previous year in the
Consumer Price Index for Urban Wage Earners and Clerical Workers,
U.S. City Average All Items, 1967=100 (the "Cost of Living
Adjustment") or (b) by such higher amount as may be approved by
the Board or the Compensation Committee thereof upon
consideration of such factors that it believes to be relevant and
appropriate. Each year's executive compensation analysis shall
be considered by the Board within 45 days following the end of
the immediately preceding fiscal year; adjustments to Executive's
Base Salary for the ensuing fiscal year shall be made within 75
days of the commencement of that year, and shall be applied
retroactive to such commencement date. All Base Salary shall be
paid in equal periodic installments in accordance with the
Company's normal payroll schedule.
3.2 INCENTIVE BONUS PLAN PARTICIPATION - In addition to the
base salary, Executive will be entitled to participate in the
Company's Management Incentive Bonus Plan, pursuant to and
subject to the provisions of which Executive will be entitled to
receive 50% of an executive bonus compensation pool (the
"Executive Compensation Pool") consisting of an aggregate of 15%
of the annual pre-tax profits of the Company; provided, however,
that such percentage may be reduced at the discretion of the
committee administering the plan, but not below 35%.
3.3 GENERAL INCENTIVE COMPENSATION PROGRAMS. The Company
hereby agrees that Executive shall be entitled to participate, to
an extent consistent with his title and Base Salary, in such
incentive compensation programs, including stock option or other
stock-based compensation plans or programs, as may be established
by the Board for the Company's officers, other key employees, or
employees as a group.
3.4 RESTRICTED STOCK INCENTIVE PLAN. Pursuant to and
subject to the provisions of the Company's Management Incentive
Bonus Plan and the award agreements issued thereunder, upon the
adoption of a restricted stock incentive plan by the Company (the
"Restricted Stock Plan"), which may be included in and adopted as
part of the Company's Management Incentive Bonus Plan, twenty-
five percent (25%) of Executive's annual incentive compensation
payable thereafter, including pursuant to Section 3.2, at the
option of the Company, will be paid in the form of restricted
Company common stock. The restricted stock will be awarded at
eighty percent (80%) of the average closing price of the common
stock for the last ten consecutive trading days in the calendar
year to which the bonus relates and shall vest 50% on each of the
first and second anniversary of the award. The Executive may
elect to exchange up to one-third of the restricted stock awarded
under the Restricted Stock Plan for a non-qualified stock option
to purchase three shares for each share of restricted stock
awarded, at an exercise price per share equal to the average
closing price of the common stock for the last ten consecutive
trading days in the calendar year to which the bonus relates.
Any such non-qualified stock option shall vest and be exercisable
as to one-third of the total number of shares on each of the
first three anniversaries of the grant date thereof, which shall
be the same date on which the restricted exchange was made and
will have a ten year life, with provisions for accelerated
vesting upon change in control, death, disability, or retirement.
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4. BENEFITS
During Executive's employment hereunder, Executive shall:
(a) be eligible to participate in employee fringe benefits and
any pension or profit sharing plans that may be provided by the
Company for executive employees in accordance with the provisions
of any such plans, as the same may be in effect from time to
time; (b) be eligible to participate in any medical and health
plans or other employee welfare benefit plans that may be
provided by the Company for its executive employees in accordance
with the provisions of any such plans, as the same may be in
effect from time to time, and the Company shall pay the premiums
on a term life insurance policy, paying benefits of not less than
$1,000,000, obtained and owned by Executive covering his life,
and with such beneficiaries thereunder as Executive may choose to
name from time to time; (c) be entitled to annual paid vacation
in accordance with Company policy that may be applicable to
executive employees from time to time; and (d) be entitled to
sick leave, sick pay, and disability benefits in accordance with
any Company policy that may be applicable to executive employees
from time to time.
Without limiting the provisions of the foregoing paragraph,
the Company also shall: (a) provide to Executive a monthly
automobile allowance of not less than Seven Hundred Fifty Dollars
($750.00) to be used by Executive to purchase, lease, or rent (in
Executive's discretion) an automobile; (b) provide to Executive a
mobile telephone and mobile telephone service; (c) reimburse
Executive for expenses relating to Executive's use of the
automobile for Company business, including, without limitation,
insurance, maintenance, fuel and other such associated expenses,
and for entertainment and other expenses incurred by Executive in
connection with or related to the Company's business (or the
advancement or development thereof); and (d) provide Executive
with an annual allowance of $10,000 to be used by Executive, in
his discretion, to pay the costs of financial, legal, or tax
planning services obtained by Executive from advisors of
Executive's own selection or the costs of other programs, events,
or activities deemed by Executive to be appropriate or desirable
in light of Executive's standing in the community as a senior
officer of an important business. Executive shall submit
appropriate records relating to such expenses to receive
reimbursement from the Company for such expenses, in accordance
with the Company's policy for senior executive officers; the
Company acknowledges that an extensive amount of business related
travel will be required by Executive to perform his duties
hereunder.
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5. CONFIDENTIAL INFORMATION
Executive agrees that he will hold in a fiduciary capacity,
for the benefit of the Company, all secret or confidential
information, knowledge, or data of the Company ("Confidential
Information") obtained by him during his employment by the
Company, and will not disclose such information to any person
other than in the course of performing his duties hereunder or as
may be required by law or by order of a court or other regulatory
authority of competent jurisdiction, unless the Company shall
consent in writing thereto. Additionally, Executive agrees that,
after termination of his employment under this Agreement, he will
not disclose, at any time, to any person, any Confidential
Information constituting a trade secret under applicable law and,
for a period of one (1) year after termination of employment
under this Agreement for cause, Executive will not disclose
Confidential Information to any person whether or not such
information constitutes a trade secret under applicable law. For
the purposes of this Section 5, information that is or becomes a
part of the public domain (other than as a result of Executive's
breach) shall not be deemed Confidential Information.
6. NO RECRUITMENT; NON-COMPETITION
6.1 NO RECRUITMENT. During Executive's employment
hereunder and for one (1) year after the termination of
Executive's employment hereunder for cause (or for such time as
Executive is receiving severance pay from the Company for
termination other than for cause) plus, at the option of the
Company, an additional six (6) months provided that during such
six-month period Executive is then being employed for a base
compensation of at least Forty Thousand Dollars ($40,000.00) per
month or the Company pays to Executive Forty Thousand Dollars
($40,000.00) per month, Executive will not, directly or
indirectly, (a) induce or conspire with, or attempt to induce or
conspire with, any of the officers or employees or registered
representatives of the Company or any of its subsidiaries or
affiliates to terminate their employment or relationship with or
compete against the Company or any of its subsidiaries or
affiliates, or any of the clients or customers of any such entity
to terminate their relationship with any such entity, or (b)
divert or attempt to divert any or all of such clients' or
customers' business with the Company or any of its subsidiaries
or affiliates from any such entity, unless the Company shall
consent in writing thereto.
6.2 NON-COMPETITION. During Executive's employment
hereunder and for one (1) year after the termination of
Executive's employment hereunder for cause, Executive will not,
directly or indirectly, for any reason, for his own account, or
on behalf of or together with any other person, be engaged as an
officer, director, employee, independent contractor, consultant
or advisor, or sales representative of any kind, or as an owner,
co-owner, or other investor of or in, a business that provides
securities brokerage, corporate finance, asset management,
capital formation, investment banking, financial advisory, or
other services in competition with the business engaged in by the
Company within the continental United States on the date hereof
or, to the extent permitted by and enforceable under applicable
law, in which the Company is so engaged on the date of
Executive's termination.
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Notwithstanding the foregoing, Executive may own and hold as
a passive investment up to one percent (1%) of the outstanding
capital stock of a competing entity if that class of capital
stock is listed for trading or quotation on a national or
regional stock exchange registered with the SEC or on The Nasdaq
Stock Market.
6.3 DAMAGES. Because of the difficulty in measuring the
economic losses that may be incurred by the Company as a result
of any breach by Executive of the covenants in Section 6.1, and
because of the immediate and irreparable damage that could be
caused to the Company for which it would have no other adequate
remedy, Executive agrees that the Company may enforce the
provisions of Section 6.2 by any equitable or legal means,
including seeking an appropriate injunction or restraining order
against Executive if a breach of any of those provisions occurs.
6.4 REASONABLE RESTRAINT. The parties hereto each agree
that Sections 6.2 and 6.3 impose a reasonable restraint on
Executive in light of the position of Executive with the Company,
the activities and business of the Company on the date hereof,
and the current business plans of the Company (of which Executive
acknowledges that he is aware).
6.5 SEVERABILITY; REFORMATION. The covenants in this
Section 6 are severable and separate, and the unenforceability of
any specific covenant in this Section 6 is not intended by any
party hereto to, and shall not, affect the provisions of any
other covenant in this Section 6. If any court of competent
jurisdiction shall determine that the scope, time, or territorial
restrictions set forth in Section 6.2 are unreasonable as applied
to Executive, the parties hereto acknowledge their mutual
intention and agreement that those restrictions be enforced to
the fullest extent the court deems reasonable, and thereby shall
be reformed to that extent as applied to Executive.
6.6 INDEPENDENT COVENANT. All of the covenants in this
Section 6 are intended by each party hereto to be, and shall be
construed as, an agreement independent of any other provision in
this Agreement, and the existence of any claim or cause of action
of Executive against the Company, whether predicated on this
Agreement or otherwise, shall not constitute a defense to the
enforcement by the Company of any covenant in this Section 6. It
is specifically agreed that the period specified in Section 6.2
shall be computed by excluding from that computation any time
during which Executive is in violation of any provision of
Section 6.2.
6.7 Materiality. The Company and Executive hereby agree
that this Section 6 is a material and substantial part of this
Agreement.
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7. TERMINATION OF EMPLOYMENT
7.1 BY COMPANY. Executive's employment under this
Agreement may be terminated by the Company at any time for cause.
For the purposes of this Section 7.1, "cause" shall mean: (a) the
conviction of Executive for an act or acts of dishonesty by
Executive that constitutes a felony under applicable law and that
subjects the Company to substantial loss or detriment, as
determined by a majority of the members of the Board; (b) the
imposition of disciplinary action against Executive, pursuant to
a final non-appealable action, by a regulatory body having
disciplinary authority over members of Executive's profession,
which disciplinary action prevents Executive from performing his
duties hereunder for a period of not less than thirty-one (31)
consecutive days and is determined by a majority of the members
of the Board to have caused substantial loss or detriment to the
Company; or (c) Executive's habitual neglect of, or refusal to
perform, his duties under this Agreement, or deliberate and
intentional disregard of lawful instructions from the Board;
provided, however, that Executive shall have received written
notice of such alleged neglect, refusal, or disregard from the
Board and shall have failed within thirty (30) days after the
receipt of such notice to cure and correct such alleged neglect,
refusal, or disregard (or to begin in good faith to effect such
cure and correction if such cannot practically be completed
within such 30-day period).
If Executive's employment is terminated under this Section
7.1, the Company shall have no further obligation to Executive
hereunder except to pay to him, in cash on the effective date of
such termination, any amount accrued but unpaid hereunder as of
the termination date, except that the rights of Executive (and
the obligations of the Company) under Section 8 shall continue
without regard to such termination. If Executive's employment is
terminated by the Company for cause, as provided above, this
Agreement shall terminate and neither party shall have any
further obligation to the other, except as provided above, and
except for Executive's agreements contained in Sections 5 and 6.
7.2 BY DEATH. If Executive dies, this Agreement shall
terminate on the date of Executive's death. In such event, the
Company shall pay promptly to Executive's designated beneficiary
or, if no designated beneficiary, to Executive's estate, any
compensation or other amount earned or accrued as of the date of
Executive's death but not yet paid and any other payments to
which Executive is entitled pursuant to Section 3.1 and Section 4
hereof (as a result of transactions in process as of the date of
Executive's death), and permit Executive's estate or legal
representative to exercise (during the one-year period
thereafter) any outstanding stock option with respect to the
number of shares for which the option has vested and has not
expired as of such date.
7.3 BY DISABILITY. If Executive becomes unable to perform
his normal duties hereunder as a result of his incapacity due to
physical or mental illness for a period of at least one hundred
twenty (120) consecutive days, the Company shall have the option
to terminate this Agreement upon the expiration of such period
(the "Disability Date"). In such an event, the Company shall pay
to Executive (within thirty (30) days thereof) all amounts
accrued but unpaid as of the Disability Date and, in the manner
and at the times set forth in Section 3.1 above, an amount equal
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to the difference between (a) the Base Salary payable for the
remainder of the Term and (b) 1.4285714 times the sum of all
payments made to Executive under any disability insurance
coverage provided to him pursuant to Section 4 hereof; and
Executive shall continue to vest in, and remain entitled to
exercise, any outstanding stock option in the manner and at the
times otherwise set forth therein.
7.4 BY DISCHARGE. If Executive's employment under the
terms of this Agreement is terminated by the Company for any
reason other than cause, death, or disability (in any such case a
"Discharge"), then (a) the Company shall pay to Executive, on the
date of Discharge, a lump sum cash amount equal to the greater of
(i) 12 months of Executive's Base Salary at the time of the
Discharge and (ii) Executive's Base Salary, without regard to
Cost of Living Adjustments, payable for the remainder of the
Term; (b) the Company shall pay to Executive the amounts, and on
the schedule, of bonus compensation under Section 3.2 that would
be payable to Executive during the remainder of the Term in the
absence of the Discharge; and (c) Executive shall immediately
become fully vested in, and be entitled to exercise for a period
of 90 days after the date of Discharge, all outstanding stock
options not previously vested or exercised. Such payment shall
be in addition to other payments, if any, to which Executive is
entitled pursuant to Section 4 hereof, and the rights of
Executive (and the obligations of the Company) under Section 8
shall continue without regard to such Discharge. No Discharge
shall be permitted pursuant to this Section 7.4 unless approved
by a majority of the members of the Board.
7.5 BY EXECUTIVE. If (a) the Company significantly reduces
Executive's authority or duties as described in Section 1.1 (or
Executive's standing within the Company as a function of
Executive's relationships with the Board or with other members of
management of the Company) other than at the direction of the New
York Stock Exchange or similar regulatory authority with
jurisdiction over the Company or any of its subsidiaries or (b) a
change of control of the Company occurs that is not approved by
Executive, then, in any such event, Executive may terminate this
Agreement and such termination shall be treated as if it were a
Discharge under Section 7.4; provided that the Board shall have
received written notice from Executive of any reduction described
in clause (a) above upon which Executive proposes to base a
termination and the Company shall have failed within thirty (30)
days thereafter to reverse the situation. For purposes hereof,
"change of control" shall mean (c) the acquisition by a person or
entity other than Executive or a now existing shareholder of the
Company (or any affiliate of Executive or such a shareholder of
the Company), whether in one or several transactions, by
exchange, merger, consolidation, assignment, stock spin-off,
stock split-up, or other transaction, of more than thirty-five
percent (35%) of the voting stock of the Company, or of the right
to vote or to direct the voting of such percentage of voting
stock; or (d) a change in the membership of the Board of
Directors of the Company such that a majority of the members are
persons who are not Continuing Directors. For purposes of this
Agreement, a "Continuing Director" is a person who is a member of
the Board of Directors of the Company on the date hereof or a
person who is elected as a director of the Company upon the
nomination by or approval of a majority of the Continuing
Directors in office.
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8. LEGAL EXPENSE REIMBURSEMENTS
8.1 INDEMNIFICATION LEGAL EXPENSES. Without limiting the
scope of any indemnification to which Executive is or may be
entitled under applicable law or pursuant to the Company's
Articles of Incorporation, Bylaws, or contract for
indemnification of officers or directors of the Company, the
Company shall indemnify and hold Executive harmless from and
against the costs and expenses (including attorneys' fees and
costs) of Executive's defense with respect to any suit,
investigation, or other action or proceeding instituted or
threatened against Executive by any person, agency, body, or
other entity that is based on, arises out of, or is related to
any position that Executive has or had with the Company or any of
its subsidiaries or other affiliates or otherwise to the
performance by Executive of any duty or responsibility under this
Agreement. To the maximum extent permitted by applicable law,
the Company agrees to advance to Executive the amount of such
costs and expenses as they are incurred by Executive (upon
written request by Executive therefor, accompanied by reasonably
detailed explanation of the basis for such advance(s)), and
Executive agrees, to the extent that such agreement may be
required by applicable law to permit such advances, to account to
the Company for such advance(s), including to refund to the
Company any such amount that it may ultimately be determined
(according to applicable law) that Executive is not entitled to
receive as indemnification or reimbursement for such costs and
expenses as a result of the final disposition of the underlying
suit, investigation, or other action or proceeding in respect of
which such costs or expenses were incurred. The Company agrees
to take such corporate action as may be necessary or advisable,
if requested by Executive, to authorize, approve, or effectuate
and implement the rights conferred upon Executive in this Section
8.1.
8.2 DISPUTES RELATING TO AGREEMENT. If (a) a Dispute (as
hereinafter defined) arises, and (b) either a court, governmental
agency, or similar body of competent jurisdiction issues a final,
nonappealable order, judgment or decree (a "Final Order"), or
Executive and the Company reach a definitive settlement of the
Dispute (a "Settlement"), that sustains the position in the
Dispute taken by Executive prior to the Dispute Date (as
hereinafter defined), then the Company shall reimburse Executive
for his reasonable legal expenses actually incurred from and
after the Dispute Date in connection with obtaining the Final
Order or Settlement, to the extent such expenses exceeded any
award for legal expenses contained in any such Final Order. For
purposes hereof, the "Dispute Date" shall be ten (10) business
days after the date upon which Executive delivers to the Company,
in accordance with Section 9.7, written notice setting forth the
particulars of a matter covered by this Agreement about which
Executive and the Company disagree (the "Dispute") and stating
his intention to seek legal counsel for assistance regarding such
matter. Except as expressly set forth above, the Company
undertakes no obligation to advance, reimburse, or otherwise pay
or assume any expense of Executive incurred in interpreting or
enforcing this Agreement.
8.3 SURVIVAL. The provisions of this Section 8 shall
survive any termination of Executive's employment or of this
Agreement.
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9. MISCELLANEOUS
9.1 ASSIGNMENT. This Agreement is personal in nature and
may not be assigned by either party without the express written
consent of the other party; provided, however, that the
provisions of this Agreement shall inure to the benefit of and be
binding upon each successor of the Company, whether by merger,
consolidation, transfer of all or substantially all assets, or
otherwise.
9.2 WAIVER. The waiver by any party to this Agreement of a
breach by the other party of any of the provisions of this
Agreement shall not operate as or be construed as a waiver of any
different or subsequent breach.
9.3 ENTIRE AGREEMENT. This Agreement constitutes and
expresses the entire agreement of the parties with respect to the
subject matter hereof.
9.4 GOVERNING LAW. This Agreement shall be governed by,
and construed and enforced in accordance with, the laws of the
State of Florida (without regard to its rules of conflicts of
laws).
9.5 NO THIRD PARTY BENEFICIARIES. Nothing in this
Agreement, whether express or implied, is intended to or shall be
construed to confer upon or give any person not a party hereto
any rights or remedies hereunder, whether as a third-party
beneficiary or otherwise.
9.6 SEVERABILITY. Should any clause or any other portion
of this Agreement be determined to be void or unenforceable for
any reason, such determination shall not affect the validity or
enforceability of any other clause or portion of this Agreement,
all of which shall remain in full force and effect, unless the
result of any such invalidity or unenforceability shall be to
cause a material failure of consideration to the party seeking to
sustain the validity or enforceability of the subject provision.
9.7 NOTICES. All notices and other communications
hereunder shall be deemed to have been duly given on the date of
receipt if delivered personally or three (3) business days after
deposit in the United States Mail, if in writing and sent to the
Company at its address provided following its signature to this
Agreement (Attention: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇), or to Executive at
the address provided following his signature to this Agreement,
as the case may be, or to such other address as one party shall
have given to the other in accordance with this provision.
9.8 EFFECT OF CAPTIONS AND HEADINGS. The captions and
headings contained herein are for convenience only, do not
constitute a part of this Agreement, and shall not be used in
construing it.
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IN WITNESS WHEREOF, the parties have executed this
Agreement, as an instrument under seal, as of the day and year
first written above.
"Company"
JWGENESIS FINANCIAL CORP.
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇
▇▇▇▇ ▇. ▇▇▇▇▇
Executive Vice President
Address: ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇
▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
"Executive"
/s/ ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇ (SEAL)
▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
Address: ▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇.
▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇