Exhibit 10.1

 

EMPLOYMENT AGREEMENT

 

AGREEMENT by and between NFP Securities, Inc., a Texas corporation (the
“Company”), National Financial Partners Corp., a Delaware corporation (“NFP”),
and Jeffrey A. Montgomery (the “Executive” and together with NFP and the
Company, the “Parties”), dated as of November 1, 2003.

 

WHEREAS, on April 25, 2001, the Executive entered into an Employment Agreement
with the Company (the “Predecessor Employment Agreement”); and

 

WHEREAS, the Predecessor Employment Agreement terminated by its own terms
effective as of May 21, 2003; and

 

WHEREAS, the Company and NFP determined that it is in the best interest of the
Company and NFP to continue to employ the Executive as the President and Chief
Executive Officer of the Company and the Executive desires to serve the Company
and NFP in such capacities.

 

NOW, THEREFORE, IT IS HEREBY AGREED AS FOLLOWS:

 

1. Employment Period. The Company shall employ the Executive, and the Executive
shall serve the Company, on the terms and conditions set forth in this
Agreement, for the period beginning on the date hereof (the “Effective Date”)
and ending October 31, 2005. The period of time between the Effective Date and
the termination of the Executive’s employment with the Company and NFP hereunder
shall be referred to herein as the “Employment Period.”

 

2. Position and Duties. During the Employment Period, the Executive shall serve
as President and Chief Executive Officer of the Company and shall perform duties
and be assigned responsibilities which are substantially similar to those
performed by the Executive immediately prior to the Effective Date and as may be
assigned to him from time to time. During the Employment Period, the Executive
shall report to the Chief Executive Officer of NFP. During the Employment
Period, and excluding any periods of vacation and sick leave to which the
Executive is entitled, the Executive shall devote full attention and time during
normal business hours to the business and affairs of the Company and, to the
extent necessary to discharge the responsibilities assigned to the Executive
under this Agreement, use the Executive’s reasonable best efforts to carry out
such responsibilities faithfully and efficiently. The Executive shall not,
during the Employment Period, engage in any other business activities that will
interfere with the Executive’s employment pursuant to this Agreement. During the
Employment Period, Executive shall be entitled to a seat on the Company’s board
of directors unless there has been a Promotion (as defined in Section 4.(c)
hereof).

 

3. Compensation. (a) Base Salary. During the Employment Period and from the
period June 1, 2003 through October 31, 2003 (the “Retroactive Period”), the
Company shall pay the Executive an annual base salary of $300,000 (“Annual Base
Salary”), payable in equal installments not less frequently than monthly. The
amount of the Annual Base Salary due Executive during the Retroactive Period
shall be payable to Executive during the month of November 2003.

 

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(b) Annual Bonus. In addition to the Annual Base Salary, for each full fiscal
year of the Company ending during the Employment Period, commencing with the
2003 fiscal year, the Executive shall be eligible to receive an annual bonus
(the “Annual Bonus”), which bonus shall be payable on or around the same time
that bonuses are paid to other executives of NFP and the Company and based on
the performance of the Executive and certain objective standards, including
without limitation, the profitability of the Company. For the 2003 fiscal year
and during the Employment Period, the Company may consider additional awards
based on the Executive’s performance and contributions.

 

(c) Employee Benefits. In addition to the foregoing, during the Employment
Period, the Executive shall be entitled to participate in the formal employee
benefit plans and programs of the Company as in effect from time to time on the
same basis as all other executives of the Company.

 

(d) Expenses. During the Employment Period, the Executive shall be entitled to
receive prompt reimbursement for all reasonable business expenses incurred by
the Executive. Executive’s reimbursements shall include fees for Executive’s
membership in the Young President’s Organization, attorney licensing and bar
membership fees and costs incurred in connection with Executive’s securities and
investment advisory registrations.

 

(e) Equity Grants. The Company and NFP will recommend that the Executive will be
considered at the same times and on the same underlying terms and conditions
(e.g., strike price, vesting schedules, and exercise periods) as all other
senior executives of NFP for equity based compensation and incentive awards
including, without limitation, grants of stock options and restricted stock.

 

4. Termination of Employee. (a) Death or Disability. In the event of the
Executive’s death during the Employment Period, the Executive’s employment with
the Company shall terminate automatically. NFP or the Company, in its
discretion, shall have the right to terminate the Executive’s employment because
of the Executive’s Disability during the Employment Period. “Disability” means
that the Executive has been unable, for 180 consecutive days, or for periods
aggregating 180 business days in any period of twelve months, to perform the
Executive’s duties under this Agreement, as a result of physical or mental
impairment, illness or injury. A termination of the Executive’s employment by
NFP or the Company for Disability shall be communicated to the Executive by
written notice, and shall be effective on the 30th day after receipt of such
notice by the Executive (the “Disability Effective Date”), unless the Executive
returns to satisfactory full-time performance of the Executive’s duties before
the Disability Effective Date.

 

(b) By NFP or the Company. In addition to termination for Disability, NFP or the
Company may terminate the Executive’s employment during the Employment Period
for Cause or without Cause. “Cause” means:

 

(i) the Executive’s continued failure to attend to his duties as an executive
officer of the Company, or

 

(ii) illegal conduct or gross misconduct by the Executive in connection with the
Company, NFP or their affiliates, or

 

(iii) any willful violation of Sections 6, 7 or 8 of this Agreement; or

 

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(iv) the Executive’s conviction of, or plea of guilty or nolo contendere to, a
felony; or

 

(v) any material dishonesty by the Executive in connection with his employment;
or

 

(vi) any material failure by the Executive to comply with the Company’s or NFP’s
applicable employment practices, rules or regulations, which is not remedied
within 30 days after receipt by the Executive of written notice from the Company
or NFP describing such claimed breach; or

 

(vii) any failure by the Executive to maintain his securities registration,
including without limitation, any willful violation of applicable laws, rules or
regulations by the Executive that results in the suspension or revocation of
Executive’s securities registrations or licenses.

 

(c) By the Executive without Good Reason or for Good Reason. The Executive may
terminate employment voluntarily without Good Reason or for Good Reason. “Good
Reason” means, without the Executive’s written consent:

 

(i) a material diminution in the Executive’s position, duties or
responsibilities from those held, exercised and/or assigned to the Executive in
Section 2 of this Agreement as a result of action by the Company or NFP or a
successor of the Company or NFP, other than an isolated, insubstantial and
inadvertent action that is not taken in bad faith and is remedied by the Company
or NFP (as applicable) promptly after receipt of notice thereof from the
Executive;

 

(ii) any failure by the Company or NFP to comply with any material provision of
this Agreement, other than a failure that is not taken in bad faith and is
remedied by the Company or NFP (as applicable) promptly after receipt of notice
thereof from the Executive; or

 

(iii) any requirement by the Company or NFP that Executive’s services be
rendered at a location more than 50 miles from Austin, TX other than for
reasonable travel obligations of the Executive in connection with the duties
under this Agreement unless such requirement is imposed on Executive in
connection with a Promotion (as defined in Section 4.(c) hereof ), which
requires Executive to move to the New York metropolitan area or any other
location in the United States where NFP’s corporate headquarters may be located
at the time such relocation requirement is imposed.

 

No act or omission shall constitute “Good Reason” hereunder, unless the
Executive provides notice of such act or omission to the Company and NFP within
90 days of the Executive’s knowledge of its occurrence. Notwithstanding anything
to the contrary in this Section 4.(c), Good Reason hereunder shall not include:
(i) a promotion (a “Promotion”) to an executive position at NFP; or (ii) upon a
Change of Control (as defined in Section 5.(a) hereof), a change in the
Executive’s position to another position within the Company, NFP, NFP Insurance
Services, Inc. or a successor company with a substantially similar level of
authority and responsibility as the Executive maintained before the Change of
Control and subject to the conditions of Section 4.(c) (i).

 

(d) Notice of Termination. Any termination by NFP or the Company for Cause, or
by the Executive for Good Reason, shall be communicated by Notice of Termination
to the other party hereto given in accordance with Section 10 of this Agreement.
A “Notice of Termination” means a written notice which (i) indicates the
specific termination provision in this Agreement relied upon, (ii) to the extent
applicable, sets forth in reasonable detail the facts and circumstances claimed
to

 

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provide a basis for termination of the Executive’s employment under the
provision so indicated and (iii) if the Date of Termination (as defined below)
is other than the date of receipt of such notice, specifies the termination date
(which date shall be not more than 30 days, nor less than 15 days, after the
giving of such notice). The failure by the Executive, the Company or NFP to set
forth in the Notice of Termination any fact or circumstance which contributes to
a showing of Good Reason or Cause shall not waive any right of the Executive,
the Company or NFP, respectively, hereunder or preclude the Executive, the
Company or NFP, respectively, from asserting such fact or circumstance in
enforcing the Executive’s, the Company’s or NFP’s rights hereunder.

 

(e) Date of Termination. “Date of Termination” means (i) if the Executive’s
employment is terminated by the Company or NFP for Cause, or by the Executive
for Good Reason, the date of receipt of the Notice of Termination or any later
date specified therein (within 30 days of such receipt), as the case may be,
(ii) if the Executive’s employment is terminated by the Company or NFP other
than for Cause or the Executive terminates employment without Good Reason, the
Date of Termination shall be the date on which the Company or NFP or the
Executive, as the case may be, notifies such other party of such termination and
(iii) if the Executive’s employment is terminated by reason of death or
Disability, the Date of Termination shall be the date of death of the Executive
or the Disability Effective Date, as the case may be.

 

5. Obligations upon Termination. (a) By NFP or the Company Other than for Cause,
death or Disability or By the Executive for Good Reason: If, during the
Employment Period, NFP or the Company terminates the Executive’s employment,
other than for Cause, death or Disability, or the Executive terminates
employment for Good Reason (in either case, hereafter referred to as a “Section
5.(a) Termination”), the Company shall, for the period equal to the remainder of
the then-current Employment Period (as in effect immediately before the Date of
Termination (the “Continuation Period”)), continue to pay the Executive the
Annual Base Salary, as and when such amounts would be paid in accordance with
Section 3 above. In the event a Section 5.(a) Termination of or by the Executive
occurs after an “NFP Change of Control,” the Company shall also pay the
Executive an additional amount equal to his Annual Bonus for the immediately
preceding full fiscal year pro rated as of the Date of Termination. In addition,
for any Section 5.(a) Termination, all stock options to purchase shares of NFP
common stock granted to the Executive shall become fully vested and the exercise
period for such options shall be the earlier of (i) five years from the Date of
Termination; and (ii) the termination of the exercise period stated in the stock
option award agreement(s) at issue without regard to any provisions in such
agreement(s) that reduce the length of such period upon a termination of
employment. NFP or the Company shall also continue to provide for the
Continuation Period the formal employee benefit plans and programs to the
Executive and/or the Executive’s eligible dependents, as favorable as those that
would have been provided to them under Section 3.(c) of this Agreement if the
Executive’s employment had continued until the end of the then current
Employment Period; provided, that the Executive and/or the Executive’s eligible
dependents continues to pay the cost payable for such benefits, and, provided
further, that during any period when the Executive is eligible to receive such
benefits under another employer-provided plan, the benefits provided by the
Company under this Section 5.(a) may be made secondary to those provided under
such other plan. The payments and benefits provided pursuant to this Section
5.(a) are intended as liquidated damages for a termination of the Executive’s
employment by NFP or the Company other than for Cause, death or Disability or
for a termination of the Executive’s employment by the Executive for Good Reason
and shall be the sole and exclusive remedy therefor. Notwithstanding anything in
this Agreement to the contrary, the Executive shall not be entitled to any
severance payments or benefits under this Section 5.(a) until the effectiveness
of a release executed by the Executive and delivered to NFP and the Company,

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substantially in the form of Exhibit A hereto (the “Release”), and the Company’s
and NFP’s obligation to continue to provide the payments and benefits described
in this Section 5(a) shall cease upon any violation by the Executive of the
restrictive covenants set forth in Sections 6, 7 and 8 hereof, which cessation
shall not limit the Company’s or NFP’s right to injunctive relief or any other
applicable remedy at law or equity. Upon the effectiveness of the Executive’s
Release, a representative of each of the Company and NFP shall execute and
deliver to the Executive a release substantially in the form of Exhibit B
hereto. The Executive’s obligation to comply with the restrictive covenants set
forth in Sections 6, 7 and 8 hereof shall cease upon a default by the Company or
NFP of its obligations under this Section 5(a), other than an isolated,
insubstantial and inadvertent failure that is remedied by the Company or NFP (as
applicable) promptly after receipt of notice thereof from the Executive. For
purposes of this Section 5(a), an NFP Change of Control shall mean (i) an event
or series of events in which any persons who are not stockholders or affiliates
of NFP immediately prior to such event or events become the beneficial owners of
shares of NFP which represent more than fifty percent (50%) of all classes of
stock of NFP, except pursuant to a public offering of securities of NFP, (ii) a
sale or other disposition of all or substantially all of the assets of NFP,
other than to an affiliated entity, or (iii) a merger, consolidation or other
reorganization of NFP with a person which is not an affiliate of NFP immediately
prior to such merger, consolidation or other reorganization, unless the
shareholders of NFP prior to such merger, consolidation or reorganization
continue to be the beneficial owners of more than fifty percent (50%) of all
classes of stock of NFP following such merger, consolidation or reorganization.

 

(b) Death or Disability; Cause; By the Executive Other Than for Good Reason. If,
during the Employment Period, the Executive’s employment is terminated by reason
of the Executive’s death or Disability or by the Company for Cause or the
Executive terminates his employment other than for Good Reason, the Company
shall make, within 30 days after the Date of Termination or the Disability
Effective Date, a lump-sum cash payment to the Executive or his estate or legal
representative, as the case may be, equal to the Executive’s Annual Base Salary
through the Date of Termination or Disability Effective Date, and the Company
shall have no further obligation under this Agreement.

 

6. Noncompetition Covenant. During the Employment Period and thereafter during
the Restricted Period (as defined below), the Executive will not engage in or
become employed in any capacity by, or become an officer, employee, director,
agent, consultant, contractor, shareholder or partner of, or otherwise hold an
interest in, any partnership, corporation or other entity that competes with or
engages in, anywhere in the United States, any business in which NFP is engaged
or any similar business, except for: (a) the ownership of less than 5% of the
stock or other equity interests of a publicly traded firm or corporation; or (b)
Executive’s acceptance of employment or a consulting position with Accredited
Investor Services, Inc. of St. Cloud, MN (an “AIS Position”) as long as
Executive’s activities in connection with an AIS position do not include
recruiting or acquisition related duties or responsibilities. For all purposes
of this Agreement, the “Restricted Period” shall mean: (a) the period commencing
on the termination of the Executive’s employment with NFP, the Company or any
subsidiary of NFP and ending on the first anniversary of the Executive’s
termination of employment if the date of the termination of the Executive’s
employment is on or after November 1, 2004; or (b) the expiration of the
Continuation Period if the date of the termination of the Executive’s employment
is before November 1, 2004. The Executive agrees that this covenant is
reasonable with respect to its duration, geographic area and scope. If, at the
time of enforcement of this Section 6, a court holds that the restrictions
stated herein are unreasonable under the circumstances then existing, the
parties hereto agree that the maximum period, scope or geographic area legally
permissible under such circumstances will be substituted for

 

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the period, scope or area stated herein. Notwithstanding anything to the
contrary in the foregoing, the Executive shall not be subject to the
Noncompetition Covenant in this Section 6. if there is either a final
adjudication or the parties hereto agree that either the Executive was
terminated by NFP or the Company other than for Cause or the Executive
terminated his employment for Good Reason. In the event Executive is subject to
the Noncompetition Covenant hereunder, the Company shall continue to pay the
Executive the Annual Base Salary, as and when such amounts would be paid in
accordance with Section 3 (the “Noncompete Payments”) until the termination of
the Restricted Period. Notwithstanding anything to the contrary in the
foregoing, Executive shall not be entitled to any Noncompete Payments: (a) after
he accepts an AIS Position; or (b) if he has been terminated for Cause by the
Company pursuant to Section 4 (b) (ii), (iii), (iv) or (v) hereof. In order that
the issue be free of doubt, it is understood and agreed that the Noncompetition
Covenant hereunder may only be triggered by events that occur during the
Employment Period and that the termination of this Agreement by its own terms on
October 31, 2005 shall not trigger any such covenant unless an earlier
triggering event during the Employment Period has occurred.

 

7. Nonsolicitation Covenants. (a) No Hiring of NFP Employees. The Executive
additionally agrees that, during the Employment Period and through the second
anniversary of the expiration of the Employment Period (the “Non-Solicitation
Period”), the Executive shall not directly or indirectly, on his own behalf or
on behalf of any other person or entity, solicit, or attempt to solicit or hire,
any employee, agent or contractor of the Company, NFP, its subsidiaries or
affiliates or any member (a “Member”) of any insurance marketing platform
affiliated with NFP (collectively and individually referred to as the “NFP
Affiliated Group”) to leave the employ of or cease doing business or being
associated with the NFP Affiliated Group, including without limitation, as a
registered representative or investment advisory affiliate of the Company, for
any reason whatsoever.

 

(b) No Solicitation of Customers. The Executive additionally agrees that, during
the Non-Solicitation Period, the Executive shall not, directly or indirectly, on
his own behalf or on behalf of any other person or entity (i) engage in any
business transaction or relationship with a Client or a Member of the NFP
Affiliated Group or perform any services for a Client or a Member of the NFP
Affiliated Group, (ii) solicit the business of any person or entity that is a
Client or a Member of the NFP Affiliated Group or (iii) interfere with or induce
any Client or a Member to discontinue any business relationship with the NFP
Affiliated Group from entering into a business relationship or transaction with
the NFP Affiliated Group. For purposes hereof, the following term shall have the
meaning set forth herein: (i) “Client” shall mean any person or entity that is a
client of the NFP Affiliated Group during the 12-month period prior to the Date
of Termination or during the Non-Solicitation Period.

 

(c) Reasonableness; Extraordinary Remedies. The Executive agrees that the
covenants in this Section 7 are reasonable with respect to their duration and
scope. If, at the time of enforcement of this Section 7, a court holds that the
restrictions stated herein are unreasonable under the circumstances then
existing, the parties hereto agree that the maximum period or scope legally
permissible under such circumstances will be substituted for the period or scope
stated herein. In the event of a breach of the Executive’s covenants in this
Section 7, it is understood and agreed that NFP shall be entitled to injunctive
relief as well as other applicable remedies at law or in equity available to NFP
against the Executive or others.

 

8. Disclosure of Confidential Information. (a) Except to the extent (i)
authorized by the express prior consent of the Company’s and NFP’s boards of
directors, (ii) required by law or any

 

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legal process or (iii) desirable in performing his duties under this Agreement,
the Executive will not, directly or indirectly, at any time during the
Employment Period, or at any time subsequent to the termination of the
Employment Period, disseminate, disclose or divulge, to any person, firm,
corporation, association or other business entity, Confidential Information of
NFP. In the event of a breach or threatened breach by the Executive of this
Section 8, NFP shall be entitled to injunctive relief as well as other
applicable remedies at law or in equity available to NFP against the Executive
or others. For purposes hereof, “Confidential Information of NFP” shall mean any
and all information about NFP or any other members of the NFP Affiliated Group
(including, without limitation, the Company) or relating to the trade secrets of
NFP or any other members of the NFP Affiliated Group (including, without
limitation, the Company), in each case disclosed to the Executive or known by
the Executive as a consequence of or through his relationship with the Company
or NFP, if such information is not publicly available (other than through a
breach by the Executive of this Section 8).

 

(b) All computer software, business cards, telephone lists, client lists,
prospective client lists, price lists, contract forms, catalogs, books, records,
files and know how acquired while the Executive is employed by or otherwise
affiliated with the Company are acknowledged to be the property of the Company
and shall not be duplicated, removed from the Company’s possession or premises
or made use of other than in pursuit of the business of the Company or as may
otherwise be required by law or any legal process, or as is necessary in
connection with any adversarial proceeding against the Company and, upon
termination of the Employment Period for any reason, the Executive shall deliver
to the Company, without further demands, all copies thereof which are then in
his possession or under his control. It is hereby acknowledged that the
Executive’s responsibilities may include the making of technical, product and
managerial contributions of value to the Company and NFP. The Executive hereby
assigns to NFP all rights, title and interest in such contributions and
inventions made or conceived by the Executive, alone or jointly with others,
during the Employment Period and relating to the business of NFP or of the
Company or the operations of thereof. The Executive shall promptly and fully
disclose all such contributions and inventions to NFP and shall assist NFP in
obtaining and protecting the rights therein.

 

9. Resolution of Disputes. Any dispute or controversy between the parties
relating to or arising out of this Agreement or any amendment or modification
hereof shall be determined by arbitration in New York, New York by and pursuant
to the rules then prevailing of the American Arbitration Association, other than
claims for injunctive relief under Sections 6, 7 or 8. The arbitration award
shall be final and binding upon the parties and judgment may be entered thereon
by any court of competent jurisdiction. The service of any notice, process,
motion or other document in connection with any arbitration under this Agreement
or the enforcement of any arbitration award hereunder may be effectuated either
by personal service upon a party or by certified mail duly addressed to him or
to his executors, administrators, personal representatives, next of kin,
successors or assigns, at the last known address or addresses of such party or
parties.

 

10. Notice. Any notice, request, reply, instruction, or other communication
provided or permitted in this Agreement must be given in writing and may be
served by depositing same in the United States mail in certified or registered
form, postage prepaid, addressed to the party or parties to be notified with
return receipt requested, or by delivering the notice in person to such party or
parties. Unless actual receipt is required by any provision of this Agreement,
notice deposited in the United States mail in the manner herein prescribed shall
be effective on dispatch. For purposes of notice, the address of the Executive,
his spouse, any purported donee or transferee or any

 

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administrator, executor or legal representative of the Executive or his estate,
as the case may be, shall be as follows:

 

To the Executive:

Jeffrey A. Montgomery

NFP Securities, Inc.

1250 Capitol of Texas Highway South Building 2, Suite 600

Austin, Texas 78746

 

Copy to:

David Senger, Esq.

Moss and Barnett

4800 Wells Fargo Center

90 South Seventh Street

Minneapolis, MN 55402

 

The Company:

NFP Securities, Inc.

1250 Capitol of Texas Highway South Building 2, Suite 600

Austin, Texas 78746

Attention: General Counsel

 

NFP:

National Financial Partners Corp.

787 Seventh Avenue, 49th Floor

New York, New York 10019

Attention: General Counsel

 

Each of NFP and the Company shall have the right from time to time and at any
time to change its address and shall have the right to specify as its address
any other address by giving at least ten (10) days’ written notice to the
Executive. The Executive shall have the right from time to time and at any time
to change his address and shall have the right to specify as his address any
other address by giving at least ten (10) days’ written notice to NFP and the
Company.

 

11. Controlling Law. The execution, validity, interpretation and performance of
this Agreement shall be determined and governed by the laws of the State of New
York, without reference to principles of conflict of laws.

 

12. Entire Agreement. The Executive, the Company and NFP acknowledge that this
Agreement contains the entire agreement of the parties with respect to the
subject matter hereof and supersedes any other agreement, whether written or
oral, between them concerning the subject matter hereof, including, but not
limited to, the Summary of Terms of Employment Agreement and the Predecessor
Employment Agreement. The captions of this Agreement are not part of the
provisions hereof and shall have no force or effect.

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13. Severability. If any provision of the Agreement is rendered or declared
illegal or unenforceable by reason of any existing or subsequently enacted
legislation or by decree of a court of competent jurisdiction, the parties shall
promptly meet and negotiate substitute provisions for those rendered or declared
illegal or unenforceable, but all remaining provisions of this Agreement shall
remain in full force and effect.

 

14. Survival. The provisions of Sections 6, 7, 8, 9, 10, 11, 12, 13, 14, 15 and
20 shall survive the termination of the Employment Period and the termination of
this Agreement to the extent applicable.

 

15. Effect of Agreement, Assignment, Required Assumption. This Agreement shall
be binding upon the Executive and his heirs, executors, administrators, legal
representatives, successors and assigns, the Company and NFP and their
successors and assigns. The Executive may not assign any rights or obligations
hereunder without the prior written consent of NFP and, except with respect to a
successor entity (as described below), NFP may not assign any rights or
obligations hereunder without the prior written consent of the Executive. NFP
shall require any person who is the successor (whether direct or indirect, by
purchase, merger, consolidation or otherwise) to all or a substantial portion of
the business or assets of NFP to expressly assume the obligations of NFP
hereunder. The terms “NFP” and the “Company” as used in this Agreement shall
expressly include any such successors.

 

16. Amendments, Waivers. This Agreement cannot be changed, modified or amended,
and no provision or requirement hereof may be waived, without the consent in
writing of the Executive, the Company and NFP. The failure of a party at any
time or times to require performance of any provision hereof shall in no manner
affect the right of such party at a later time to enforce the same. No waiver by
a party of the breach of any term or covenant contained in this Agreement,
whether by conduct or otherwise, in any one or more instances, shall be deemed
to be, or construed as, a further or continuing waiver of any such breach, or a
waiver of the breach of any other term or covenant contained in this Agreement.

 

17. Withholding. Notwithstanding any other provision of this Agreement, the
Company may withhold from amounts payable under this Agreement all federal,
state, local and foreign taxes that are required to be withheld by applicable
laws or regulations.

 

18. Beneficiaries. Whenever this Agreement provides for any payment to the
Executive’s estate, such payment may be made instead to such beneficiary or
beneficiaries as the Executive may have designated in a writing filed with the
Company. The Executive shall have the right to revoke any such designation and
to redesignate a beneficiary or beneficiaries by written notice to the Company
to such effect.

 

19. Counterparts. This Agreement may be executed in two or more counterparts,
each of which shall be deemed to be an original. It shall not be necessary when
making proof of this Agreement to account for more than one counterpart.

 

20. Indemnity. Reference is made to the by-laws of the Company and the
indemnification rights afforded directors and officers of the Company. In
addition to those rights, NFP hereby agrees to indemnify you to the full extent
authorized by law for any loss incurred by you, including reasonable attorney’s
fees incurred by you, as a result of you being made or threatened to be made a
party to any action, suit or proceeding, whether criminal, civil,

 

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administrative or investigative, or being required to testify in any matter, by
reason of the fact that you are or were a director or officer of or otherwise
affiliated with the Company or NFP or serve or served any other enterprise as a
director, officer or employee at the request of the Company or NFP. The Company
and NFP shall use commercially reasonable efforts to maintain errors and
omissions and directors and officers liability insurance to cover loss or
liability of the Executive incurred as the result of a matter that would be
indemnifiable hereunder; however, the Company’s and/or NFP’s failure to maintain
such insurance coverage shall not limit or otherwise reduce the Company’s and
NFP’s obligations hereunder. The Company will reimburse Executive for any
reasonable travel costs or incidental expenses or fees incurred in connection
with testimony or consulting in any matter contemplated by this paragraph.

 

IN WITNESS WHEREOF, the Executive has hereunto set the Executive’s hand and each
of the Company and NFP have caused this Agreement to be executed in its name on
its behalf, all as of the day and year first above written.

 

 

    

 

/S/    JEFFREY A. MONTGOMERY

    

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     JEFFREY A. MONTGOMERY     

 

NFP SECURITIES, INC.

     /S/    DOUGLAS W. HAMMOND     

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     By: Douglas W. Hammond      Title: Vice President     

 

NATIONAL FINANCIAL PARTNERS CORP.

     /S/    MARK BIDERMAN     

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     By: Mark Biderman      Title: Executive Vice President

 

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EXHIBIT A

 

GENERAL RELEASE

 

THIS GENERAL RELEASE is entered into between NFP Securities, Inc., a Texas
corporation (the “Company”), National Financial Partners Corp., a Delaware
corporation (“NFP”), and Jeffrey A. Montgomery (the “Employee”) as of the ___day
of                             . The Company, NFP and the Employee agree as
follows:

 

1 . Employment Status. The Employee’s employment with NFP and the Company shall
terminate effective as of                         ,
                            .

 

2. Payment and Benefits. Upon acceptance of the terms set forth herein, the
Company shall provide the Employee with the payments and benefits set forth in
Section 5.(a) of the Employment Agreement between NFP, the Company and the
Employee, dated as of December [    ], 2002 (the “Employment Agreement”).

 

3 . Confidentiality of Release. The parties agree that the existence and terms
of this Release are and shall remain confidential. The parties shall not
disclose the fact of this Release or any of its terms or provisions to any
person without the prior, written consent of the other parties hereto; provided,
however, that nothing in this Paragraph 3 shall prohibit disclosure of such
information to the extent required by law; nor prohibit disclosure of such
information by the Employee to any legal or financial consultant, all of whom
shall first agree to be bound by the confidentiality provisions of this
Paragraph 3 to the extent reasonably possible; nor prohibit disclosure of such
information by or within NFP or the Company in the ordinary course of their
business to those persons or entities with a need to know, as reasonably
determined by NFP or the Company.

 

4. No Liability. This Release does not constitute an admission by NFP, the
Company, or any of their subsidiaries, affiliates, divisions, trustees,
officers, directors, partners, agents, or employees, of any unlawful acts or of
any violation of federal, state or local laws.

 

5. Release. In consideration of the payments and benefits set forth in Section
5.(a) of the Employment Agreement, the Employee for himself, his heirs,
administrators, representatives, executors, successors and assigns
(collectively, “Employee Releasors”) does hereby irrevocably and unconditionally
release, acquit and forever discharge NFP, the Company and their subsidiaries,
affiliates, divisions, successors, assigns, trustees, officers, directors,
partners, agents, and former and current employees, including without limitation
all persons acting by, through, under or in concert with any of them
(collectively, “NFP Releasees”), and each of them from any and all charges,
complaints, claims, liabilities, obligations, promises, agreements,
controversies, damages, remedies, actions, causes of action, suits, rights,
demands, costs, losses, debts and expenses (including attorneys’ fees and costs)
of any nature whatsoever, known or unknown, whether in law or equity and whether
arising under federal, state or local law and in particular including any claim
for discrimination based upon race, color, ethnicity, sex, age (including the
Age Discrimination in

 

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Employment Act of 1967), national origin, religion, disability, or any other
unlawful criterion or circumstance, which Employee Releasors had, now have, or
may have or claim to have in the future against each or any of the NFP Releasees
from the beginning of the world until the date of the execution of this Release
relating to the Employee’s employment with NFP, the Company and their
subsidiaries and affiliates; provided, however, that, except as provided in
Paragraph 7 hereof, nothing herein shall release NFP or the Company from the
obligation to make the payments described in Section 5.(a) of the Employment
Agreement prior to the satisfaction of such payments in full.

 

6. Bar. The Employee acknowledges and agrees that if he should hereafter make
any claim or demand or commence or threaten to commence any action, claim or
proceeding against the NFP Releasees with respect to any cause, matter or thing
which is the subject of Paragraph 5 of this Release, this Release may be raised
as a complete bar to any such action, claim or proceeding, and the applicable
NFP Releasee may recover from the Employee all costs incurred in connection with
such action, claim or proceeding, including attorneys’ fees.

 

7. Restrictive Covenants. The Employee acknowledges that the provisions of
Sections 6, 7 and 8 of the Employment Agreement shall continue to apply pursuant
to their terms and that the Company and NFP shall be released from any
obligations under Paragraph 2 of this Release or Section 5.(a) of the Employment
Agreement upon any violation by the Executive of such restrictive covenants.

 

8. Governing Law. This Release shall be governed by and construed in accordance
with the laws of the State of New York.

 

9. Acknowledgment. The parties hereto have read this Release, understand it, and
voluntarily accept its terms, and the Employee acknowledges that he has been
advised by NFP and the Company to seek the advice of legal counsel before
entering into this Release, and has been provided with a period of forty-five
(45) days in which to consider entering into this Release.

 

10. Revocation. The Employee has a period of ten (10) days following the
execution of this Release during which the Employee may revoke this Release, and
this Release shall not become effective or enforceable until such revocation
period has expired.

 

11. Counterparts. This Release may be executed by the parties hereto in
counterparts, which taken together shall be deemed one original.

 

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IN WITNESS WHEREOF, the Executive has hereunto set the Executive’s hand and each
of the Company and NFP have caused this Agreement to be executed in its name on
its behalf, all as of the day and year first above written.

 

 

 

   

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    JEFFREY A. MONTGOMERY    

 

NFP SECURITIES, INC.

   

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    By:     Title:    

 

NATIONAL FINANCIAL PARTNERS CORP.

 

   

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    By:     Title:

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EXHIBIT B

 

GENERAL RELEASE

 

THIS GENERAL RELEASE is executed and delivered by NFP Securities, Inc., a Texas
corporation (the “Company”) and National Financial Partners Corp., a Delaware
corporation (“NFP”) to Jeffrey A. Montgomery (the “Employee”).

 

1. Release. Each of the Company and NFP agrees to and does hereby irrevocably
and unconditionally release, acquit and forever discharge the Employee, and his
heirs, executors, and administrators (hereinafter collectively referred to as
the “Employee Releasees”), with respect to and from any and all charges,
complaints, claims, liabilities, obligations, promises, agreements,
controversies, damages, remedies, actions, causes of action, suits, rights,
demands, costs, losses, debts and expenses of any kind whatsoever, known or
unknown, whether in law or equity and whether arising under federal, state or
local law, for, upon, or by reason of, any matter, course or thing whatsoever
from the beginning of the world until the date of execution of this Release
relating to the Employee’s employment with NFP, the Company and their
subsidiaries; provided, however, that nothing herein shall release the Employee
from the obligations or restrictions arising under or referred to or described
in Sections 6, 7, and 8 of the Employment Agreement between the Company, NFP and
the Employee, dated as of January 1, 2003 (the “Employment Agreement”), or
impair the right or ability of the Company or NFP to enforce such provisions in
accordance with the terms of the Employment Agreement. All claims released by
the undersigned pursuant to this Release shall collectively be referred to
herein as the “Released Company Claims.” Notwithstanding the foregoing, in no
event shall the Released Company Claims include any claims involving fraud,
malfeasance or willful misconduct on the part of the Employee or any claims for
liability against the Employee in his capacity as an officer, director or
employee of the Company, NFP or any of their affiliates which, if brought
against the Employee in his capacity as a director of the Company or NFP, could
not be eliminated under Section 102(b)(7) of the General Corporation Law of the
State of Delaware, as in effect on the date of this Release.

 

2. Bar. Each of the Company and NFP acknowledges and agrees that if it should
hereafter make any claim or demand or commence or threaten to commence any
action, claim or proceeding against the Employee Releasees with respect to any
cause, matter or thing which is the subject of Paragraph 1 of this Release, this
Release may be raised as a complete bar to any such action, claim or proceeding,
and the applicable Employee Releasee may recover from the Company or NFP, as the
case may be, all costs incurred in connection with such action, claim or
proceeding, including attorneys’ fees.

 

3. Governing Law. This Release shall be governed by and construed in accordance
with the laws of the State of New York.

 

4. Successors. This Release shall be binding upon the Company and NFP and their
successors and assigns.

 

5. Counterparts. This Release may be executed by the parties hereto in
counterparts, which taken together shall be deemed one original.

 

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IN WITNESS WHEREOF, this RELEASE has been executed on behalf of each of NFP and
the Company on this      day of                         ,
                            .

 

 

   

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    JEFFREY A. MONTGOMERY    

 

NFP SECURITIES, INC.

 

 

   

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    By:     Title:    

 

NATIONAL FINANCIAL PARTNERS CORP.

 

 

   

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    By:     Title: