promissory note

Jan

2017

Current Merrill Lynch Recruitment Deal

From the Desk of Jim Eccleston at Eccleston Law LLC

Merrill Lynch has marketed a recruitment deal to financial advisors which consists of an upfront cash payment between 150% and 170%. Additionally, the hurdles in order to meet back-end production goals under the deal are:

· Year 1: Hurdle – 75% of assets

Payout bonus: 50% of production (from same year)

· Year 2: Hurdle – 95% of assets

Payout bonus: 40% of production (from same year)

· Year 3: Hurdle – 115% of assets

Payout bonus: 30% of production (from same year)

· Year 4: Hurdle – 125% of assets

Payout bonus: 25% of production (from same year)

· Year 5: Hurdle – 155% of assets

Payout bonus: 25% of production (from same year)

All proposed deals are negotiable and reflected in numerous agreements such as promissory note and employment agreements. Reps should retain qualified legal counsel to review those documents in advance of committing to transition to a new firm.

Jan

2017

Current Stifel Recruitment Deal

From the Desk of Jim Eccleston at Eccleston Law LLC

Stifel has marketed a recruitment deal to financial advisors which consists of an upfront cash payment of 100% +.

Sep

2012

Rep’s Wrongful Termination Claim Offsets Forgivable Loan Claims

Wells Fargo Advisors claimed that former representative Randall A. Fisher failed to repay the balance due on his promissory note upon termination from employment. Fisher denied the allegations and filed a counter-claim in which he alleged that he was constructively discharged.

The FINRA arbitration panel ordered Fisher to pay Wells Fargo $530,644.45 plus interest, costs, and attorneys’ fees. However, the arbitration panel also ordered Wells Fargo to pay Fisher $594,840.00 plus attorneys’ fees. The net sum is $48,172.61 owed to Wells Fargo.

Wells Fargo came up short here netting just $48,000 and walking away for slightly more than 6% of the damages the Claimant originally sought. Here, the advisers’ wrongful termination effectively negated the promissory note collection claim.