Exhibit
10.3
NEWTEK BUSINESS SERVICES,
INC.
Employment Agreement
with
Craig J.
Brunet
PREAMBLE . This Agreement entered into this 13th day of
July 2006, by and between Newtek Business Services, Inc. (the
“Company”) and Craig J. Brunet (the
“Executive”), effective immediately.
WHEREAS, the Executive is to be employed by the Company
as an Executive Vice President; and
WHEREAS, the parties desire by this writing to set forth
the employment relationship of the Company and the
Executive.
NOW, THEREFORE , it is AGREED as
follows:
1. Defined Terms
When used anywhere in the Agreement, the
following terms shall have the meaning set forth herein.
(a) “Board” shall mean the Board of Directors of the
Company.
(b) “Change in Control”
shall mean any one of the following
events: (i) the acquisition of ownership, holding or power to vote
50% or more of the Company’s voting stock, (ii) the
acquisition of the ability to control the election of a majority of
the Company’s directors, (iii) the acquisition of a
controlling influence over the management or policies of the
Company by any person or by persons acting as a “group”
(within the meaning of Section 13(d) of the Securities Exchange Act
of 1934), or (iv) during any period of two consecutive years,
individuals (the “Continuing Directors”) who at the
beginning of such period constitute the Board of Directors of the
Company (the “Existing Board”) cease for any reason to
constitute at least one half thereof, provided that any individual
whose election or nomination for election as a member of the
Existing Board was approved by a vote of at least two-thirds of the
Continuing Directors then in office shall be considered a
Continuing Director. For purposes of this paragraph only, the term
“person” refers to an individual or a corporation,
partnership, trust, association, joint venture, pool, syndicate,
sole proprietorship, unincorporated organization or any other form
of entity not specifically listed herein.
(c) “Code” shall mean the Internal Revenue Code of 1986,
as amended from time to time, and as interpreted through applicable
rulings and regulations in effect from time to time.
(d) “Code §280G
Maximum” shall
mean the product of 2.99 and the Executive’s “base
amount” as defined in Code §280G(b)(3).
(e) “ Company ” shall mean
Newtek Business Services, Inc., and any successor to its
interest.
(f) “Effective Date”
shall mean the date of execution
referenced in the Preamble of this Agreement.
(g) “Executive” shall mean Craig J. Brunet.
(h) “Good Reason”
shall mean any of the following
events, which has not been consented to in advance by the Executive
in writing: (2) the requirement that the Executive perform his
principal executive functions on a permanent and regular basis more
than seventy five (75) miles from his primary office (New York, NY)
as of the Effective Date; (2) a material reduction in the
Executive’s base compensation as the same may be increased
from time to time; (3) the failure by the Company to continue to
provide the Executive with compensation and benefits provided for
on the Effective Date, as the same may be increased from time to
time, or with benefits substantially similar to those provided to
him under any of the Executive benefit plans in which the Executive
now or hereafter becomes a participant, or the taking of any action
by the Company which would directly or indirectly reduce any of
such benefits or deprive the Executive of any material fringe
benefit enjoyed by him; (4) the assignment to the Executive of
duties and responsibilities materially different from those
associated with his position on the Effective Date; and (5) a
material diminution or reduction in the Executive’s
responsibilities or authority in connection with his employment
with the Company, except for the well-being of the Company in the
judgment of the Board.
(i) “Just Cause”
shall mean the Executive’s (1)
willful misconduct, (2) breach of fiduciary duty, (3) intentional
failure to perform stated duties, conviction of a felony, (4)
conviction of a misdemeanor punishable by imprisonment of not less
than 6 months, (5) performance of duties in a negligent or reckless
manner, (6) material breach of any provision of this
Agreement.
2.
Employment
. The Executive is employed as an
Executive Vice President of Strategic Planning and Marketing of the
Company. The Executive shall render such management services for
the Company and its affiliates as are customarily performed by
persons situated in a similar executive capacity and which are
consistent with the duties of a senior executive manager. The
Executive shall report to the Chief Executive Officer. The
Executive shall, with respect to all matters to which he devotes
attention, meet with and communicate regularly with other senior
management of the Company and its subsidiaries. The Executive shall
also promote, by entertainment or otherwise, as and to the extent
permitted by law, the business of the Company and its subsidiaries.
The Executive’s other duties shall be such as the Company's
Chief Executive Officer may from time to time reasonably direct,
including normal duties as an officer of the Company, participation
on an executive management committee of the Company for so long as
so constituted by the Chief Executive Officer, and election and/or
appointment as a board member or officer of the Company’s
current and future principal business subsidiaries.
3.
Base Compensation
. The Company agrees to pay the
Executive during the term of this Agreement a salary at the rate of
$240,000 per annum, payable in cash not less frequently than
monthly. Additionally, the Board shall review, not less often than
annually, the rate of the Executive’s salary and may decide
to further increase his salary.
4.
Benefits .
(a) Participation in Retirement, Medical and Other
Plans . The Executive
shall participate in any plan that the Company maintains for the
benefit of its employees if the plan relates to (i) pension,
profit-sharing, or other retirement benefits, (ii) medical
insurance or the reimbursement of medical or dependent care
expenses, or (iii) other group benefits, including disability and
life insurance plans.
(b) Executive Benefits; Expenses
. The Executive shall participate in
any fringe benefits which are or may become available to the
Company’s senior management Executives, including for example
incentive compensation plans, club memberships, and any other
benefits which are commensurate with the responsibilities and
functions to be performed by the Executive under this Agreement.
The Executive shall be reimbursed for all reasonable out-of-pocket
business expenses which he shall incur in connection with his
services under this Agreement upon substantiation of such expenses
in accordance with the policies of the Company, including the
Company’s Employee Handbook and Code of Conduct.
5.
Term . The Company hereby employs the Executive, and
the Executive hereby accepts such employment under this Agreement,
for the period commencing on the Effective Date and ending on
December 31, 2007 or such earlier date as is determined in
accordance with Section 10 (the “Term”).
6. Loyalty; Non-competition .
(a) During the period of his employment hereunder
and except for illnesses, reasonable vacation periods, and
reasonable leaves of absence, the Executive shall devote
substantially all his full business time, attention, skill, and
efforts to the faithful performance of his duties hereunder;
provided, however, from time to time, Executive may serve on the
boards of directors of, and hold any other offices or positions in,
companies or organizations, at the request of the Company or which
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