{"id":39086,"date":"2015-09-17T11:25:58","date_gmt":"2015-09-17T16:25:58","guid":{"rendered":"https:\/\/content.findlaw-admin.com\/ability-legal\/contracts\/uncategorized\/employment-agreement-e-trade-group-inc-and-christos-cotsakos.html"},"modified":"2015-09-17T11:25:58","modified_gmt":"2015-09-17T16:25:58","slug":"employment-agreement-e-trade-group-inc-and-christos-cotsakos","status":"publish","type":"corporate_contracts","link":"https:\/\/corporate.findlaw.com\/contracts\/compensation\/employment-agreement-e-trade-group-inc-and-christos-cotsakos.html","title":{"rendered":"Employment Agreement &#8211; E*Trade Group Inc. and Christos Cotsakos"},"content":{"rendered":"<pre>                              EMPLOYMENT AGREEMENT\n\n     This Agreement is made effective this 15th day of May, 2002 (the\n\"Effective Date\"), by and between E*TRADE GROUP, INC., a Delaware corporation\n(\"Company\"), and CHRISTOS M. COTSAKOS, (\"Executive\").\n\n                                   BACKGROUND\n\n     Executive is the Chairman of the Board and Chief Executive Officer of\nCompany and is currently employed pursuant to the terms of an existing\nemployment agreement. The Company now wishes to simplify its contractual\nrelationship with the Executive to better align the interests of the Executive\nand its shareowners and stakeholders.\n\n                              TERMS AND CONDITIONS\n\n     In consideration of the premises and the mutual covenants and agreements\nset forth below, the parties agree as follows:\n\n     1. Termination of Prior Agreements. All prior employment agreements\nbetween the Company and the Executive shall terminate and be of no further\nforce and effect as of the date of this Agreement.\n\n     2. Employment. Executive agrees to continue to serve as Chief Executive\nOfficer of Company, and as Chairman of the Company's Board of Directors, for\nthe term of this Agreement, subject to the terms set forth in this Agreement\nand the provisions of the Bylaws of Company.\n\n     3. Compensation. As compensation for his services during the term of this\nAgreement, Executive shall receive the amounts and benefits set forth in this\nSection 3 all effective as of the Effective Date unless otherwise specified:\n\n          (a) The Executive will receive an annual base salary of $0. However,\nthis base salary may be reviewed and adjusted by the Board in light of the\nCompany's performance following the one year anniversary of this Agreement.\n\n          (b) Participation in the Company's management bonus plan, with bonus\npayments to be determined and paid based on the Company's meeting its\nperformance objectives. The Executive will not be entitled to a minimum bonus.\nIn the event that the Company meets its performance objectives, the target\nbonus will be $4 million. The actual bonus paid to the Executive may exceed $4\nmillion in the event that, in the opinion of the Board, the Company\nsubstantially exceeds its performance objectives. The Executive agrees that any\nbonus payment is contingent upon its performance objectives being met in full\naccordance with generally accepted accounting principles and in accordance with\nthe Company's Guiding Principles.\n\n          (c) Participation in the employee benefit plans maintained by the\nCompany and in other benefits provided by Company and in other benefits\nprovided to senior executives. The Executive shall continue to participate in\nthe Supplemental Executive\n\n\n\n\n\nRetirement Plan (\"SERP), but will waive his right to vest in six million\ndollars of the amount that was contributed to the Executive's account in 2001.\nIt is acknowledged by the Executive and the Company that the formula used to\ncalculate payments to the SERP will be modified to reflect the actual bonus\npaid to the Executive, as opposed to potential bonus. In no event shall\nExecutive's annual compensation for purposes of determining SERP benefits\nexceed $5 million. The Executive shall not receive any tax gross up payments in\nconnection with any SERP contributions.\n\n     4. Equity. It is acknowledged that Executive has received restricted stock\nand stock options (collectively, \"Equity\") with specific terms and conditions\nprovided in the relevant documentation. Company agrees that there will be no\nchange made in any such documentation during the Term, without the prior\nwritten consent of Executive, with the exception that the Executive shall waive\nhis right to vest in two million of the shares of restricted stock which remain\noutstanding and unvested as of the effective date of this Agreement. The\nremaining unvested restricted stock shall vest on a pro rata basis over the\nremaining term of the April 6, 2001 grant. Subject to Executive continuing as a\nservice provider to the Company on the applicable vesting dates. It is\nacknowledged that the Executive will not be entitled to any tax gross up\npayments for any shares of restricted stock unvested as of the date of this\nAgreement.\n\n     5. Term. This Agreement and Executive's employment under this Agreement\nshall be effective as of the Effective Date and shall continue for a term\nending on May 31, 2004 (the \"Term\"). This Agreement and Executive's employment\nmay be terminated by either party prior to the end of the Term upon 60 days'\nprior written notice to the other party, provided that, in the event of such\ntermination, Company shall be obligated to make the payments and provide the\nbenefits described in Section 6 below.\n\n     6. Termination Payments. Upon termination of Executive's employment,\nwhether by the Company for Executive death or \"Disability\" or any reason other\nthan \"Cause\" or by the Executive for \"Good Reason,\" subject to the Executive\nor, in the event of the Executive's death or Disability his estate or personal\nrepresentative, entering into and not revoking a standard release of claims in\nfavor of the Company (\"the Release\"), the Company shall pay to Executive,\nwithin three business days after the end of the latest of (1) 60-day notice\nperiod provided in Section 5 above, (2) in the event of Disability, the six\nmonth period provided in section 6 (c) below, or (3) the period in which\nExecutive, his estate or personal representative may legally revoke the Release\n(the \"Trigger Date\"), a lump sum payment in cash determined under subsection\n(a):\n\n          (a) The payment shall be equal to $4 million.\n\n          (b) In the event of the Executive's death, the Company shall pay and\nprovide to the Executive's surviving spouse or family trust (or estate, if\nnone), all the payments provided under Section 6(a). The Executive's rights\nunder the benefit plans of the Company shall be determined under the provisions\nof those plans.\n\n          (c) The Company may terminate the Executive's employment for\nDisability by giving the Employee six months' advance notice in writing.\nDisability is defined in subsection (e)(v) of this Section 6. Upon the Trigger\nDate, the Company will pay and provide to the Executive all the payments\nprovided under Section 6(a). In the event of Disability, the Executive's rights\nunder the benefit plans of the Company shall be determined under the provisions\nof those plans.\n\n\n                                       2\n\n\n          (d) In the event of termination of the Executive's employment, the\nExecutive shall remain liable to the Company for the repayment of any\noutstanding loans, and accrued interest, made to the Executive by the Company,\nexcept that the term of any such outstanding loan shall be extended for five\nyears.\n\n          (e) For purposes of this Agreement, the following definitions shall\napply:\n\n               (i) The \"Board\" shall mean the Board of Directors of Company.\n\n               (ii) The \"Incumbent Board\" shall mean the members of the Board as\nof the date of this Agreement and any person becoming a member of the Board\nhereafter whose election, or nomination for election by Company's shareholders,\nwas approved by a vote of at least a majority of the directors then comprising\nthe Incumbent Board (other than an election or nomination of an individual\nwhose initial assumption of office is in connection with an actual or\nthreatened election contest relating to the election of the directors of\nCompany).\n\n               (iii) \"Change in Control\" shall mean:\n\n                    (A) The acquisition (other than from Company) by any person,\nentity or \"group,\" within the meaning of Section 13(d)(3) or 14(d)(2) of the\nExchange Act (excluding, for this purpose, any employee benefit plan of Company\nor its subsidiaries which acquires beneficial ownership of voting securities of\nCompany) of beneficial ownership (within the meaning of Rule 13d-3 promulgated\nunder the Exchange Act) of 50% or more of either the then outstanding shares of\nCommon Stock or the combined voting power of Company's then outstanding voting\nsecurities entitled to vote generally in the election of directors; or\n\n                    (B) The failure for any reason of individuals who constitute\nthe Incumbent Board to continue to constitute at least a majority of the Board;\nor\n\n                    (C) Approval by the stockholders of Company of a\nreorganization, merger, consolidation, in each case, with respect to which the\nshares of Company voting stock outstanding immediately prior to such\nreorganization, merger or consolidation do not constitute or become exchanged\nfor or converted into more than 50% of the combined voting power entitled to\nvote generally in the election of directors of the reorganized, merged or\nconsolidated company's then outstanding voting securities, or a liquidation or\ndissolution of Company or of the sale of all or substantially all of the assets\nof Company.\n\n               (iv) \"Good Reason\" shall mean:\n\n                    (A) Without the express written consent of the Executive,\nthe assignment to Executive of any duties inconsistent in any respect with\nExecutive's position (including status, offices, titles and reporting\nrequirements), authority, duties or responsibilities as contemplated by Section\n2 above, or any other action by Company which results in a diminution of such\nposition, authority, duties or responsibilities, including any diminution of\nposition due to Executive's becoming head of a division of a larger company\nrather than Chairman and Chief Executive Officer; or\n\n                    (B) A Change in Control occurs; or\n\n\n                                       3\n\n\n                    (C) Without the express written consent of the Executive, a\nreduction in the overall level of Executive's compensation or benefits as\nprovided in Section 3, including, but not limited to, the alteration of the\nformula for calculating the target bonus payment described in Section 3(b),\nabove, in a manner that results in a lower value for such benefit; or\n\n                    (D) The Company breaches this Agreement; or\n\n                    (E) Without the express written consent of the Executive,\nthe failure of Executive to be Chairman of the Board of Directors or the\nnomination by the Board of a Chairman (or person serving in a similar capacity)\nof a person other than Executive or the failure of the Board to appoint the\nExecutive to the chairman or co-chair of the Finance Committee of the Board,\nexcept to the extent that applicable law or regulation requires otherwise.\n\n     The Company will have 15 days after receiving written notice from\nExecutive specifying the grounds for Good Reason to cure a Good Reason event or\nomission under subsections A, C, D or E hereof.\n\n               (v) \"Disability\" shall mean the total and permanent inability of\nExecutive due to illness, accident or other physical or mental incapacity to\nperform the usual duties of his employment under this Agreement, as determined\nby a physician selected by Company and acceptable to Executive or Executive's\nlegal representative, which agreement as to acceptability shall not be\nunreasonably withheld.\n\n               (vi) \"Cause\" shall be defined solely as (i) Executive's\nconviction of a felony or of any crime involving moral turpitude, and\naffirmance of such conviction following the exhaustion of any appeals; (ii)\nwillful refusal of Executive to substantially perform all of his duties and\nresponsibilities, or Executive's persistent willful neglect of duty or chronic,\nwillful unapproved absenteeism other than for a temporary or permanent\nDisability, which remains uncured following thirty days after written notice of\nsuch alleged Cause by the Board of Directors; or (iii) any material and\nsubstantial breach by Executive of other terms and conditions of this\nAgreement, which, in the reasonable, good faith judgment of the Board of\nDirectors, has a material adverse financial effect on the Company or on\nExecutive's ongoing abilities to carry out his duties under this Agreement and\nwhich remains uncured following thirty days after written notice of such\nalleged Cause by the Board of Directors.\n\n     7. Governing Law. This Agreement shall be interpreted and enforced in\naccordance with the laws of the State of California.\n\n     8. Severability. Whenever possible, each provision of this Agreement shall\nbe interpreted in such manner as to be effective and valid, but if any one or\nmore of the provisions contained in this Agreement shall be invalid, illegal or\nunenforceable in any respect for any reason, the validity, legality and\nenforceability of any such provisions in every other respect and of the\nremaining provisions of this Agreement shall not be in any way impaired.\n\n     9. Entire Agreement. This Agreement (including the equity documentation\nreferred to herein, and any indemnification agreement between the Executive and\nthe Company) contains the entire agreement of the parties with respect to the\nsubject matter contained in this Agreement. There are no restrictions,\npromises, covenants, or undertakings between Company\n\n\n                                       4\n\n\nand Executive, other than those expressly set forth in this Agreement. This\nAgreement supersedes all prior agreements and understandings between the\nparties. This Agreement may not be amended or modified except in writing\nexecuted by the parties.\n\n     IN WITNESS WHEREOF, the undersigned have executed this Agreement as of the\nday and year first above written.\n\n                                        E*TRADE GROUP, INC.\n\n                                        [CORPORATE SEAL]\n\n\n                                        --------------------------------------\n                                        David Hayden\n                                        Chair, Compensation Committee\n\n\n\n                                        --------------------------------------\n                                        Ronald Fisher\n                                        Compensation Committee\n\n\n\n                                        --------------------------------------\n                                        William Ford\n                                        Compensation Committee\n\n\n                                        EXECUTIVE\n\n\n                                        --------------------------------------\n                                        Christos M. Cotsakos\n\n\n                                       5\n\n<\/pre>\n","protected":false},"template":"","meta":{"_acf_changed":false,"_stopmodifiedupdate":true,"_modified_date":"","_cloudinary_featured_overwrite":false},"corporate_contracts_companies":[7386],"corporate_contracts_industries":[],"corporate_contracts_types":[9539],"class_list":["post-39086","corporate_contracts","type-corporate_contracts","status-publish","hentry","corporate_contracts_companies-e-trade-group-inc","corporate_contracts_types-compensation"],"acf":[],"_links":{"self":[{"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/corporate_contracts\/39086","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/corporate_contracts"}],"about":[{"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/types\/corporate_contracts"}],"wp:attachment":[{"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/media?parent=39086"}],"wp:term":[{"taxonomy":"corporate_contracts_companies","embeddable":true,"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/corporate_contracts_companies?post=39086"},{"taxonomy":"corporate_contracts_industries","embeddable":true,"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/corporate_contracts_industries?post=39086"},{"taxonomy":"corporate_contracts_types","embeddable":true,"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/corporate_contracts_types?post=39086"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}