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        EXHIBIT 10.1      NEWTEK BUSINESS SERVICES, INC.

                               -------------------

                            EMPLOYMENT AGREEMENT WITH
                                JEFFREY G. RUBIN

                               -------------------

        PREAMBLE. This Agreement entered into this 6th day of March 2003, by
and between Newtek Business Services, Inc. (the "Company") and Jeffrey G. Rubin
(the "Executive"), effective immediately.

        WHEREAS, the Executive is to be employed by the Company as an executive
officer; 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 Section 280G Maximum" shall mean the product of
2.99 and the Executive's "base amount" as defined in Code Section 280G(b)(3).

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                (e)     "Company" shall mean Newtek Business Services, Inc., and
any successor to its interest.

                (f)     "Common Stock" shall mean common stock of the Company.

                (g)     "Effective Date" shall mean the date of execution
referenced in the Preamble of this Agreement.

                (h)     "Executive" shall mean Jeffrey Rubin.

                (i)     "Good Reason" shall mean any of the following events,
which has not been consented to in advance by the Executive in writing: (i) the
requirement that the Executive move his personal residence, or perform his
principal executive functions, more than fifty (50) miles from his primary
office as of the Effective Date; (ii) a material reduction in the Executive's
base compensation as the same may be increased from time to time; (iii) 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; (iv) the assignment to
the Executive of duties and responsibilities materially different from those
associated with his position on the Effective Date; (v) a failure to elect or
reelect the Executive to the Board of Directors of the Company; (vi) a material
diminution or reduction in the Executive's responsibilities or authority
(including reporting responsibilities) in connection with his employment with
the Company.

                (j)     "Just Cause" shall mean the Executive's willful
misconduct, breach of fiduciary duty involving personal profit, intentional
failure to perform stated duties, conviction for a felony, or material breach of
any provision of this Agreement. No act, or failure to act, on the Executive's
part shall be considered "willful" unless he has acted, or failed to act, with
an absence of good faith and without a reasonable belief that his action or
failure to act was in the best interests of the Company.

                (k)     "Protected Period" shall mean the period that begins on
the date six months before a Change in Control and ends on the earlier of six
months following the Change in Control or the expiration date of this Agreement.

                (l)     "Trigger Event" shall mean (i) the Executive's voluntary
termination of employment either for any reason within the 30-day period
beginning on the date of a Change in Control, or within 90 days of an event that
both occurs during the Protected Period and constitutes Good Reason, or (ii) the
termination by the Company or its successor(s) in interest, of the Executive's
employment for any reason other than Just Cause during the Protected Period.

        2.      Employment. The Executive is employed as President and Chief
Operating Officer of the Company. The Executive shall render such administrative
and management services for the Company and its subsidiaries as set forth in the
attached Position Description and at the request of the Board as are currently
rendered and as are customarily performed by persons situated in a similar
executive capacity and consistent with the duties of the President and Chief

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Operating Officer as set forth in the bylaws of the Company. 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.

        3.      Base Compensation. The Company agrees to pay the Executive
during the term of this Agreement a salary at the rate of $285,000 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.      Cash Bonuses; Incentive Compensation.

                (a)     The Board shall determine the Executive's right to
receive incentive compensation in the form of cash bonuses and other awards. No
other compensation provided for in this Agreement shall be deemed a substitute
for such incentive compensation. Cash bonuses shall be awarded pursuant to the
terms of the Company's Annual Cash Bonus Plan if one has been adopted by the
Board and if not, then by action of the Board.

                (b)     Special incentive bonus for 2003. In addition to all
other compensation payable hereunder, the Executive shall be entitled to a bonus
of $50,000.00 if all of the following conditions are met during the year of
2003: (i) the Company is able to complete the funding of new capco program
subsidiaries in the states of Alabama, Florida and Georgia; (ii) the Company has
raised a minimum of $1 million in new cash proceeds from the sale of its Common
Stock, subject in all cases to the direct or delegated approval of the Board;
and (iii) the Compensation Committee of the Board, with the participation of the
Company's Chief Executive Officer, finds the Executive's performance to have
been satisfactory and acts to continue, renew or extend the Executive's
employment with the Company.

                (c)     Upon the execution of this Agreement, the Executive
shall be awarded fifty thousand (50,000) options pursuant to the Company's 2000
Incentive Stock and Deferred Compensation Plan which shall, to the maximum
extent permitted by law, be "incentive stock options" under the Plan. The
options will priced at fair market as of the date of award (at 110% for
incentive stock options for 10% or more stockholders), will vest at the first
anniversary of the date of award and will be exercisable for five (5) years
thereafter, until the sixth (6th) anniversary of the date of award.

        5.      Other 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.

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                (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.

                (c)     Split-Dollar Life Insurance. The Company shall provide
the Executive with split-dollar life insurance coverage. The coverage shall be
provided under a separate Split-Dollar Life Insurance Agreement (the
"Split-Dollar Agreement") entered into between the Executive and the Company,
the terms of which shall include the following:

                        (i)     Amount of Insurance. The Company shall obtain an
insurance policy (the "Policy") in the face amount of $2 million on the life of
the Executive.

                        (ii)    Ownership. The Company shall be the sole owner
of the Policy.

                        (iii)   Payment of Premiums. The Company shall pay all
premiums for each Policy year.

                        (iv)    Death Benefits. Upon the death of the Executive,
the death benefit payable under the Policy shall be paid to the Company in an
amount equal to the lesser of (i) the aggregate premiums paid by the Company and
(ii) the cash surrender value of the Policy. The balance shall be paid to the
Executive's designated beneficiary or, if none is validly designated, his
estate.

                        (v)     Dividends. All dividends on the Policy shall be
used to purchase additions to insurance issued by the insurer.

                        (vi)    Termination of Employment. Upon termination of
Executive's employment for any reason, the Executive may elect, by written
notice to the Company within 30 days of such termination, to purchase the Policy
and assume all premium obligations thereunder from the Company by paying the
lesser of (i) the total premiums paid by the Company or (ii) the cash surrender
value of the Policy.

        6.      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 12 months thereafter or such earlier
date as is determined in accordance with Section 11 (the "Term").

        7.      Loyalty; Noncompetition.

                (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

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of directors of, and hold any other offices or positions in, companies or
organizations, at the request of the Company or which will not present, in the
opinion of the Board, any conflict of interest with the Company or any of its
subsidiaries or affiliates, nor unfavorably affect the performance of
Executive's duties pursuant to this Agreement, nor violate any applicable
statute or regulation. "Full business time" is hereby defined as that amount of
time usually devoted to like companies by similarly situated executive officers.
During the term of his employment under this Agreement, the Executive shall not
engage in any business or activity contrary to the business affairs or interests
of the Company.

                (b)     Nothing contained in this Paragraph 7 shall be deemed to
prevent or limit the Executive's right to invest in the capital stock or other
securities of any business dissimilar from that of the Company or, solely as a
passive or minority investor, in any business.

        8.      Standards. The Executive shall perform his duties under this
Agreement in accordance with such reasonable standards as the Board may
establish from time to time. The Company will provide Executive with the working
facilities and staff customary for similar executives and necessary for him to
perform his duties.

        9.      Vacation and Sick Leave. At such reasonable times as the Board
shall in its discretion permit, the Executive shall be entitled, without loss of
pay, to absent himself voluntarily from the performance of his employment under
this Agreement, all such voluntary absences to count as vacation time; provided
that:

                (a)     The Executive shall be entitled to an annual vacation in
accordance with the policies that the Board periodically establishes for senior
management Executives of the Company.

                (b)     The Executive shall not receive any additional
compensation from the Company on account of his failure to take a vacation, and
the Executive shall not accumulate unused vacation from one fiscal year to the
next, except in either case to the extent authorized by the Board.

                (c)     In addition to the aforesaid paid vacations, the
Executive shall be entitled without loss of pay, to absent himself voluntarily
from the performance of his employment with the Company for such additional
periods of time and for such valid and legitimate reasons as the Board may in
its discretion determine. Further, the Board may grant to the Executive a leave
or leaves of absence, with or without pay, at such time or times and upon such
terms and conditions as such Board in its discretion may determine.

                (d)     In addition, the Executive shall be entitled to an
annual sick leave benefit as established by the Board.

        10.     Indemnification. The Company shall indemnify and hold harmless
Executive from any and all loss, expense, or liability that he may incur due to
his services for the Company as an officer and or director (including any
liability he may ever incur under Code Section 4999, or a successor, as the
result of severance benefits he collects pursuant to Sections 11 or 13) during
the full Term of this Agreement and shall at all times maintain adequate
insurance for such purposes.

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        11.     Termination and Termination Pay. Subject to Section 13 hereof,
the Executive's employment hereunder may be terminated under the following
circumstances:

                (a)     Just Cause. The Board may, based on a good faith
determination and only after giving the Executive written notice and a
reasonable opportunity to cure, immediately terminate the Executive's employment
at any time, for Just Cause. The Executive shall have no right to receive
compensation or other benefits for any period after termination for Just Cause.

                (b)     Without Just Cause. The Board may, by written notice to
the Executive, immediately terminate his employment for a reason other than Just
Cause, in which case the Executive shall be paid an amount equal to the balance
of compensation provided for by Sections 3 and 4 hereof for the balance of the
Term.

                (c)     Resignation by Executive with Good Reason. The Executive
may at any time immediately terminate employment for Good Reason, in which case
the Executive shall be entitled to receive the following compensation and
benefits: (i) the salary and cash bonus provided pursuant to Sections 3 and 4
hereof, up to the expiration date (the "Expiration Date") of the Term, including
any renewal term, of this Agreement, and (ii) the cost to the Executive of
obtaining all health, life, disability and other benefits which the Executive
would have been eligible to participate in through the Expiration Date based
upon the benefit levels substantially equal to those that the Company provided
for the Executive at the date of termination of employment. Said payment shall
be made in a lump sum payment within 10 days after his termination of
employment.

                (d)     Resignation by Executive without Good Reason. The
Executive may voluntarily terminate employment with the Company during the Term
of this Agreement, upon at least 60 days' prior written notice to the Board of
Directors, in which case the Executive shall receive only his compensation,
vested rights, and Executive benefits up to the date of his termination of
employment.

                (e)     Retirement, Death, or Disability. If the Executive's
employment terminates during the Term of this Agreement due to his death, a
disability that results in his collection of any long-term disability benefits,
or retirement at or after age 62, the Executive (or the beneficiaries of his
estate) shall be entitled to receive the compensation and benefits that the
Executive would otherwise have become entitled to receive pursuant to subsection
(d) hereof upon a resignation without Good Reason.

                (f)     Termination or Non-Renewal Payment.If the Executive's
employment hereunder is terminated pusuant to subsections (b), without Just
Cause, or (c), with Good Reason, or if the Term of this Agreement is not
extended for at least one additional year, the Executive shall be entitled to
compensation and benefits equal to six (6) months compensation and benefits
under Sections 3 and 4 hereof, provided, however, that the Company shall have
the option of paying such compensation over a twelve (12) month period.

        12.     No Mitigation. The Executive shall not be required to mitigate
the amount of any payment provided for in this Agreement by seeking other
employment or otherwise, and no such

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payment shall be offset or reduced by the amount of any compensation or benefits
provided to the Executive in any subsequent employment.

        13.     Change in Control. Notwithstanding any provision herein to the
contrary, if a Trigger Event occurs during the Protected Period, the Executive
shall be paid an amount equal to the Code Section 280G Maximum. Said sum shall
be paid in one lump sum within ten (10) days of such termination.

        14.     Reimbursement for Litigation Expenses.

        In the event that any dispute arises between the Executive and the
Company as to the terms or interpretation of this Agreement, whether instituted
by formal legal proceedings or otherwise, including any action that the
Executive takes to enforce the terms of this Agreement or to defend against any
action taken by the Company, the Executive shall be reimbursed for all costs and
expenses, including reasonable attorneys' fees, arising from such dispute,
proceedings or actions, provided that the Executive shall obtain a final
judgement by a court of competent jurisdiction in favor of the Executive. Such
reimbursement shall be paid within ten (10) days of Executive's furnishing to
the Company written evidence, which may be in the form, among other things, of a
cancelled check or receipt, of any costs or expenses incurred by the Executive.

        15. Successors and Assigns.

                (a)     This Agreement shall inure to the benefit of and be
binding upon any corporate or other successor of the Company which shall
acquire, directly or indirectly, by merger, consolidation, purchase or
otherwise, all or substantially all of the assets or stock of the Company.

                (b)     Since the Company is contracting for the unique and
personal skills of the Executive, the Executive shall be precluded from
assigning or delegating his rights or duties hereunder without first obtaining
the written consent of the Company.

        16.     Corporate Authority. Company represents and warrants that the
execution and delivery of this Agreement by it has been duly and properly
authorized by the Board and that when so executed and delivered this Agreement
shall constitute the lawful and binding obligation of the Company.

        17.     Amendments. No amendments or additions to this Agreement shall
be binding unless made in writing and signed by all of the parties, except as
herein otherwise specifically provided.

        18.     Applicable Law. Except to the extent preempted by Federal law,
the laws of the State of New York shall govern this Agreement in all respects,
whether as to its validity, construction, capacity, performance or otherwise.

        19.     Severability. The provisions of this Agreement shall be deemed
severable and the invalidity or unenforceability of any provision shall not
affect the validity or enforceability of the other provisions hereof.

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        20.     Entire Agreement. This Agreement, together with any
understanding or modifications thereof as agreed to in writing by the parties,
shall constitute the entire agreement between the parties hereto with respect to
the matters addressed and shall supercede all previous agreements with respect
to such matters.

        IN WITNESS WHEREOF, the parties have executed this Agreement on the day
and year first hereinabove written.


Witnessed by:                         NEWTEK BUSINESS SERVICES, INC.

/s/ Michelle Reres                    By /s/ Brian A. Wasserman
-----------------------------         ------------------------------------------
                                      Its:   Chief Financial Officer


Witnessed by:

/s/ Michelle Reres                          /s/ Jeffrey G. Rubin
-----------------------------         -----------------------------------------
                                            Jeffrey G. Rubin

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