XXXXX FINANCIAL GROUP, INC.
REGISTERED REPRESENTATIVE/INDEPENDENT CONTRACTOR AGREEMENT
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THIS XXXXX FINANCIAL GROUP, INC. REGISTERED
REPRESENTATIVE/INDEPENDENT CONTRACTOR AGREEMENT (this "Agreement") is
made this _____ day of _____, _____ to be effective as of the _____
day of ______,_____(the "Effective Date"), by and between XXXXX
FINANCIAL GROUP, INC., a Georgia corporation (the "Company"), and
____________ ("Independent Contractor").
WHEREAS, the Company is registered as a securities Broker-Dealer
with the Securities and Exchange Commission (the "SEC"), is a member
of the National Association of Securities Dealers, Inc. (the "NASD"),
and conducts a retail-securities business; and
WHEREAS, Independent Contractor is registered with the NASD as a
"Registered Representative" (NASD Series 7) and desires to conduct
securities brokerage through and on behalf of the Company as an
independent contractor to the Company; and
NOW, THEREFORE, for good and valuable consideration, the receipt
and sufficiency of which hereby are acknowledged, the parties hereto
agree as follows:
1. Engagement of Independent Contractor
------------------------------------
(a) The company hereby engages Independent Contractor
as Registered Representative of the Company for a
period of time commencing as of the Effective Date
and ending at such time as Independent
Contractor's engagement hereunder is terminated
pursuant to the terms hereof.
(b) Independent Contractor shall serve under this
Agreement as an independent contractor, and
nothing contained in this Agreement shall be
construed to create the relationship of employee
and employer between Independent Contractor and
the Company. Nothing contained in this agreement
is to be construed to make Independent Contractor
Exhibit 10.3 - Pg. 1
the agent or legal representative of the Company
for any purpose, and the Independent Contractor
does not have the right, power, or authority
whatsoever to assume, create or incur any
obligation or responsibility for or on behalf of
the Company, or to bind the Company in any manner
whatsoever, except as herein expressly provided.
Independent Contractor covenants that it shall not
represent, at any time, either orally or in
writing, to anyone that it has any right, power or
authority not expressly granted to it by this
Agreement.
2. Company Compliance/Written Supervisory Procedures.
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(a) Independent Contractor will comply with all
applicable laws and regulations of federal and
state governmental and regulatory agencies,
including, but not limited to compliance with both
the Statement of Policy of the Securities and
Exchange Commission and the Rules of Fair Practice
of the National Association of Securities Dealers.
(b) Independent Contractor will comply with all
applicable Company policies and procedures as
established, from time to time, by the Company.
The Company's Registered Representative's
Compliance Manual (the "Manual") contains the
Company's internal rules and policies and
references the rules and regulations of various
regulatory authorities. Copies of the Manual are
located at the Company's corporate offices and
have previously been provided to Independent
Contractor. Independent Contractor, by his
execution of this agreement, hereby represents and
warrants that he has read and understands the
Manual and covenants and agrees to abide by its
terms.
(c) Independent Contractor agrees that, except in
accordance with the published policy of the
Exhibit 10.3 - Pg. 2
Company, or alternatively upon receipt of written
approval from the Company, that for so long as I
remain a registered representative of the Company,
I will not conduct or engage in any securities
business, in any capacity, through or on behalf of
any other entity other than the Company.
(d) Independent Contractor agrees to subscribe for pay
any charges applicable to a security broker errors
and omissions liability policy as required by the
Company.
3. Benefits/Personnel Policies.
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(a) Independent Contractor shall not be entitled to
participate in any profit sharing or pension
retirement plan, vacation, holiday pay, sick pay,
insurance coverage, or other benefits intended for
the Company's employees. While acting within the
scope of his engagement hereunder, Independent
Contractor's conduct shall be businesslike and
professional as is appropriate for a person in his
position, and Independent Contractor shall at all
times and in all respects perform this Agreement
as complies with good and lawful business and
ethical practices.
(b) Independent Contractor understands and agrees that
he is responsible for all federal and state income
taxes and assessments imposed by the Internal
Revenue Service and or any State Department of
Taxation or the like, that he is responsible for
all self-employment taxes, and that he is
responsible for the accurate reporting of all
income and remuneration received as an Independent
Contractor for the Xxxxx Financial Group.
Exhibit 10.3 - Pg. 3
4. Commissions.
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Independent Contractor shall be compensated by the
Company exclusively pursuant to the schedule of rates
and changes attached hereto as Schedule A, and
otherwise as follows: Independent Contractor shall be
paid no later than the 10th calendar day of each month
with respect to transactions effectuated by
Independent Contractor and "Settled" (as defined
below) during the previous calendar month.
Independent Contractor understands that his right to
earn a commission with respect to any transaction
effectuated by Independent Contractor does not arise
until such time as transaction is "Settled," Meaning:
(I) such commission income is generated and remitted
to the Company by its clearing agent, and (ii) the
Company receives confirmation of cleared funds with
respect to such commissions. On a monthly basis, the
company shall furnish Independent Contractor with an
itemized statement showing the commissions owed
Independent Contractor for the previous calendar
month, and an itemized accounting of all expenses
deducted therefrom, such expenses to include but not
be limited to the expenses set forth on Schedule A
attached hereto.
5. Customer Complaints/Regulatory Inquiries.
-----------------------------------------
(a) Independent Contractor shall promptly inform the
Company of any customer complaints (whether
written or oral), lawsuits, arbitrations and/or
any inquiry by any regulatory authority, including
the SEC or the NASD (collectively referred to
herein as "Complaints") naming or involving the
Company or Independent Contractor, or any person
working at, conducting business for, or associated
with the Company, with respect to which
Independent Contractor becomes aware or has
knowledge.
Exhibit 10.3 - Pg. 4
(b) Independent Contractor agrees that the Company is
authorized to direct and control the strategy to
be employed with respect to responding to,
defending or otherwise handling Complaints,
including whether to offer a settlement and the
amount of or other particulars with respect to
such settlement, and may otherwise resolve
Complaints in such manner as the company deeds
appropriate. Without limiting Independent
Contractor's indemnity obligations set forth in
Section 11 hereof, any payment made or expense
incurred (including attorney's fees, costs, forum
fees, and filing fees) by the Company in
connection with investigating, responding to, or
handling a Complaint, including any settlement
thereof, involving or otherwise attributable to
Independent Contractor (collectively, "Complaint
Expenses") shall be paid by the Contractor and the
Contractor shall hereby indemnify the Company for
such Complaint Expenses, whether or not the
Independent Contractor continues to be associated
with the Company. The company is hereby
authorized by the Independent Contractor to deduct
such Complaint Expenses from any commissions due
Independent Contractor pursuant to Section 4
hereof, and Independent Contractor shall not be
paid any further commissions until such time as
all Complaint Expenses have been satisfied from
such commissions. The Company's conduct in
investigating, responding to, defending or
otherwise handling any Complaint and deducting any
Complaint Expenses from Independent Contractor's
commissions shall, in absence of a showing by
Independent Contractor of the Company's fraud or
bad faith, conclusively be deemed to have been
appropriate, reasonable, in good faith and in
accordance with the terms and intent of this
Agreement, it being the intent of the parties
Exhibit 10.3 - Pg. 5
hereto that this provision shall not require the
company to prove the legal validity of any
Complaint in order to recover any Complaint
Expenses form Independent Contractor hereunder.
6. Representations and Warranties of Independent Contractor.
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Independent Contractor represents and warrants to the
Company as follows:
(a) That he is duly licensed as a "Registered
Representative" with the NASD and is not currently
and has never been subject to a suspension or
limitation on his ability to serve as a Registered
Representative; that he has not previously been
the subject of any investigation by any regulatory
authority for violations of securities laws or
industry rules; and that he has not had any
registration or license suspended, nor has he been
fined, by the NASD, the SEC, any State, or any
other applicable regulatory authority for
violations of securities laws;
(b) That he is fully familiar with, and has working
knowledge of, all the rules, regulations,
constitutions and by-laws and statutes of all
regulatory authorities which regulate securities
markets, brokers and dealers, exchanges and
clearing houses (collectively referred to
hereafter as the "Applicable Rules"), and that,
during the term hereof, he will fully comply
therewith;
(c) That no representations, warranties, assurances or
statements by Independent Contractor in this
Agreement and no such statement contained in this
document, certificates, or other writings
furnished or to be furnished by Independent
Contractor to the Company or any of its
representatives pursuant to the provisions hereof
Exhibit 10.3 - Pg. 6
contains or will contain any untrue statement of
material fact, or omits or will omit to state any
fact necessary, in light of the circumstances
under which it was made, in order or make the
statements herein or therein not misleading.
7. Covenants of Independent Contractor.
------------------------------------
Independent Contractor covenants and agrees as follows:
(a) Independent Contractor covenants and agrees that
he shall not accept any purchase or sale
transaction unless sufficient funds, equity or
securities to consummate such transaction are in
the account for which the order is taken, nor
shall Independent Contractor commingle funds or
securities purchases from or for investors with
Independent Contractor's own funds or securities
purchases, whether in a personal, business, trust,
or special account;
(b) Independent Contractor covenants and agrees that
he shall not, at any time during the term of this
Agreement, be in violation of any applicable
local, state or federal law, ordinance,
regulation, order, injunction or decree or nay
other requirement of any governmental body,
agency, or authority or court binding on
Independent Contractor, or any other Applicable
Rule, as currently instituted or as hereafter may
be promulgated from time-to-time.
8. Non-Solicitation.
-----------------
Independent Contractor agrees that, during the term of his
engagement as an independent contractor hereunder, and for
one (1) year thereafter, Independent Contractor will not
solicit for employment, directly or through or on behalf of
any other party, any persons who are then employees of the
Company, or induce or attempt to induce the termination of
Exhibit 10.3 - Pg. 7
any such person's employment with the Company.
9. Confidentiality and Nondisclosure.
----------------------------------
Independent Contractor acknowledges and agrees that, during
the term of this Agreement, he will have access to trade
secrets and other confidential information unique to the
Company's business and that the disclosure or unauthorized
use of such trade secrets or confidential information by
Independent Contractor will injure the Company's business.
Therefore, Independent Contractor agrees that he will not,
at any time during the term of this agrees that he will
not, at any time during the term of this Agreement and for
ten (10) years thereafter, use, reveal or divulge any
Confidential Information (as defined herein). For purposes
of this Section, "Confidential Information" shall mean
information which is confidential and constitutes a
valuable asset of the Company by reason of the material
investment of the Company's time and/or money in the
production of such information including, but not limited
to, trade secrets, lists of actual or potential customers
or suppliers, financial data, a formula, pattern,
compilation, program, device, method, technique and
business plans. Independent Contractor also agrees, upon
termination of his engagement as an Independent Contractor
hereunder, to return any and all documents in his
possession which are owned by the Company or which contains
Confidential Information.
10. Term and Termination.
---------------------
This agreement shall be terminable at any time, with or
without cause, by either party hereto upon five (5) days
prior written notice to the other party hereto; provided,
however, that in the event of a material breach by
Independent Contractor of this Agreement, this Agreement
may be terminated immediately by the Company upon written
notice to Independent Contractor.
Exhibit 10.3 - Pg. 8
11. Indemnification.
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Independent Contractor agrees to indemnify, reimburse,
defend and hold harmless the Company, and each of its
directors, officers, employees, affiliates, agents,
representatives, successors, and assigns, from and against
any and all claims, losses, costs, deficiencies, damages,
consequential damages, penalties, and liabilities incurred,
and all expenses including, but not limited to, attorney's
fees and disbursements arising out of or otherwise with
respect to (i) any breach or inaccuracy of any
representation or warranty of Independent Contractor set
forth in this Agreement or in any other document,
instrument or agreement delivered pursuant hereto, (ii)any
breach of or noncompliance by Independent Contractor with
any covenant or agreement of Independent Contractor set
forth in this Agreement, (iii)any other breach by the
Independent Contractor of this Agreement, and (iv)any cost,
expense, charge, or disbursement of any kind incurred by
the Company as a result of any actions or inaction by a
client serviced by the Independent Contractor or whose
account is handled by the Independent Contractor, including
customer reneges, unsecured debit losses and other
transactional losses.
12. Assignability/Entire Agreement.
-------------------------------
No rights, duties, or obligations under this Agreement
shall be assignable by Independent Contractor without the
prior written consent of the Company. This Agreement
contains the entire agreement of the parties with respect
to the subject matter hereof. Other than as specifically
provided herein, it may only be amended by an agreement in
writing signed by each of the parties hereto.
13. Notices.
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All notices and other communications hereunder shall be in
writing and shall be deemed given when delivered personally
or when mailed by registered or certified mail, return
Exhibit 10.3 - Pg. 9
receipt requested, to the parties at their respective
addresses set forth on Schedule B attached hereto (or to
such other address as any party hereto my have furnished to
the other by written notice given in accordance herewith).
14. Arbitration/Applicable Law.
---------------------------
Other than as specifically provided in Section 15 below,
the parties agree that any dispute between them shall be
settled by arbitration by the NASD in accordance with NASD
Code of Arbitration Procedure. Any such arbitration
hearing shall be held in Atlanta, Georgia, with the parties
hereto splitting evenly all forum fees associated with such
arbitration. This Agreement has been negotiated, drafted,
and executed in the State of Georgia, and will be performed
within the State of Georgia. Accordingly, this Agreement
shall be governed by and construed in accordance with the
laws of the State of Georgia, without regard to conflict of
law principles.
15. Specific Performance/Injunctive Relief.
---------------------------------------
Independent Contractor acknowledges that remedies at law
for any actual or threatened breach by it of the covenants
set forth in Sections 8 and 9 of this Agreement would be in
adequate and that the Company shall be entitled to specific
performance of such covenants or injunctive relief against
activities in violation of aid covenants, or both, by
temporary or permanent injunction or other appropriate
judicial remedy, writ, or order, in addition to any damages
and legal expenses (including attorneys' fees) which the
company may be legally entitled to recover, which may be
sought in any court of law having jurisdiction to afford
such relief, and Independent Contractor hereby consents to
such relief being issued against it. The parties hereto
acknowledge and agree that any such recourse to a court of
law shall not be deemed a waiver or modification of the
arbitration provisions of Section 14 above. The Company
and Independent Contractor acknowledge that the covenants
Exhibit 10.3 - Pg. 10
contained in Section 8 and 9 of this Agreement shall be
construed as agreements independent of any provision of
this or any other contract between the Company and
Independent Contractor, and that the existence of any claim
or cause of action by a party hereto against the other
party hereto, whether predicated upon this or any other
contract, shall not constitute a defense to the enforcement
by the Company of said covenants.
16. Invalidity of any Provisions.
-----------------------------
It is the intention of the parties hereto that the
provisions of this Agreement be enforced to the fullest
extent permissible by the laws and public policies of each
state and jurisdiction in which such enforcement is sought,
but that the unenforceability (or the modification to
confirm with such laws or public policies) of any provision
hereof shall not render unenforceable or impair the
remainder of this Agreement, which shall be deemed amended
to delete or modify, as necessary, the invalid or
unenforceable provisions. The parties further agree to
alter the balance of this Agreement I order to render the
same valid and enforceable.
17. Survival/Waiver.
----------------
The provisions of Sections 8, 9 and 11 of this Agreement
shall survive the termination of this Agreement. No waiver
of any breach of this Agreement or provision herein
contained shall be deemed a waiver of any preceding or
succeeding breach thereof or of any agreement or provision
herein contained. No extension of time for performance of
any obligation or acts shall be deemed an extension of time
for performance of any other obligations or acts.
18. Responsibility for Compliance with Law.
---------------------------------------
Nothing in this Agreement shall be interpreted as relieving
Independent Contractor from his obligations to comply with
all applicable laws, including the Securities Act of 1933,
Exhibit 10.3 - Pg. 11
the Securities Exchange Act of 1934, and the Rules and
Regulations promulgated thereunder, the laws of the States
in which Independent Contractor is registered or licensed,
and the rules, regulations, interpretations and directives
issued by the NASD or the SEC or any other securities
exchanges.
IN WITNESS THEREOF, the undersigned have caused this Agreement to be
executed as of the date first written above:
"The Company"
XXXXX FINANCIAL GROUP, INC.
By:_______________________
Name:_____________________
Title:____________________
"Independent Contractor"
By:_______________________
Name:_____________________
Title:____________________
Exhibit 10.3 - Pg. 12
