DORAL FINANCIAL CORP
EMPLOYMENT AGREEMENT
<DOCUMENT>
<TYPE>EX-10.100
<SEQUENCE>7
<FILENAME>g74847ex10-100.txt
<DESCRIPTION>EMPLOYMENT AGREEMENT
<TEXT>
<PAGE>
                                                                 EXHIBIT 10.100


                              As of March 5, 2002


Mr. Edison Velez
650 Munoz Rivera Avenue
San Juan, Puerto Rico 00920


Dear Mr. Velez


       We are pleased to detail herein below the provisions of your employment
agreement with Doral Financial Corporation ("DFC") and Doral Mortgage
Corporation ("DMC").

         1.       TERMS OF EMPLOYMENT

                  The term of this Agreement shall be for a period commencing
retroactively to January 1, 2002 and ending December 31, 2003, unless sooner
terminated as herein provided. This Agreement supersedes and cancels all prior
employment, personal service or similar agreements between you and DFC or DMC
and their respective subsidiaries, divisions and ventures for any period after
December 31, 2001. Any amounts received by you as salary or bonus from DFC or
DMC prior to the date hereof shall be credited against amounts payable to you
pursuant to Section 3 hereof.

         2.       POSITION AND RESPONSIBILITIES

                  You will serve as Executive Vice President of DFC and CEO of
DMC. By your acceptance of this Agreement, you undertake to accept such
employment and to devote your full time and attention to DFC, DMC and their
affiliates, and to use your best efforts, ability and fidelity in the
performance of the duties attaching to such employment. During the term of your
employment hereunder, you shall not perform any services for any other company,
which services conflict in any way with your obligations under the two
preceding sentences of this Section 2, whether or not such company is
competitive with the businesses DMC or DFC, provided, however, that nothing in
this Agreement shall preclude you from devoting reasonable periods required for

                  (i)      serving as a director or member of a committee of
any organization involving no conflict or potential conflict of interest with
the interests of DMC or DFC;

                  (ii)     delivering lectures, fulfilling speaking
engagements, teaching at educational institutions;

                  (iii)    engaging in charitable and community activities; and

                  (iv)     managing your personal and family investments,
provided that such activities do not interfere with the regular performance of
your duties and responsibilities under this Agreement.


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Mr. Edison Velez
As of March 5, 2002
Page 2


                  You shall, at all times during the term hereof, be subject to
the supervision and direction of the Chairman of the Board and Chief Executive
Officer and the President and DFC with respect to your duties, responsibilities
and the exercise of your powers.

         3.       COMPENSATION

                  (a)      During the term of this Agreement you shall receive
an annual salary of $250,000 annually, payable no less often than monthly in
accordance with corporate policy.

                  (b)      (i) During the term of this Agreement, you shall
                           also be entitled to receive an annual incentive
                           bonus, payable as set forth in (iii) below, equal to
                           the lesser of (x) $300,000 and (y) 3% of the net
                           income of DMC over and above Three Million Dollars
                           ($3,000,000) derived from its Mortgage Banking
                           Activities (as hereinafter defined) provided that
                           such incentive bonus shall only be payable if you
                           have served as an executive officer of DFC or DMC
                           for the entire fiscal year to which such payments
                           relate.

                           (ii)     One half (1/2) of the incentive bonus shall
                           be payable annually within 120 days following the
                           end of the preceding fiscal year, provided that such
                           amount shall only be payable if you shall have
                           served as an executive officer of DFC or DMC
                           pursuant to this Agreement for the entire fiscal
                           year to which such payments relate. The remaining
                           one-half (1/2) of the incentive bonus (the "Deferred
                           Bonus") shall be deferred pursuant to the deferred
                           compensation arrangement described in Exhibit A
                           hereto.

                           (iii)    As used in this Section 3, "Net Income"
                           means the annual net income by DMC and its
                           subsidiaries after all taxes during the calendar
                           year preceding the payment as determined in
                           accordance with generally accepted accounting
                           principles applied on a consistent basis throughout
                           the periods involved and as shown by DMC's audited
                           financial statements audited by its independent
                           accountants (hereinafter referred to as "GAAP"). As
                           used in this Section 3, "Mortgage Banking
                           Activities" shall mean the origination, purchase,
                           receipt of interest, servicing and sale of mortgages
                           or pools of mortgages on homes in Puerto Rico and
                           the purchase and sale of interests in pools of
                           mortgages but shall not include the receipt of the
                           interest on investment securities. Until you have
                           been given notice to the contrary, all activities of
                           DMC shall be deemed to be Mortgage Banking
                           Activities, and all expenses of DMC (including all
                           taxes) shall be deemed to be related to its Mortgage
                           Banking Activities.

                  (c)      You shall be entitled to participate in the other
benefit plans of DFC upon the terms and conditions on which such benefits are
made available to other officers of DFC and DMC. Nothing herein shall obligate
DFC or DMC to continue any existing benefit plan or to establish any
replacement benefit plan.

                  (d)      You shall be entitled to reimbursement for
reasonable travel and entertainment expenses incurred in connection with the
rendering of your services hereunder. Nothing contained herein shall authorize
you to make any political contributions, including but not limited to payments
for dinners and advertising in any political party program or any other payment
to any person which might be deemed a


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Mr. Edison Velez
As of March 5, 2002
Page 3


bribe, kickback or otherwise and improper payment under corporate policy or
practice and no portion of the compensation payable hereunder is for any such
purpose.

                  (e)      Payments under this Agreement shall be subject to
reduction by the amount of any applicable federal, Commonwealth, state or
municipal income, withholding, social security, state disability insurance, or
similar or other taxes or other items which may be required or authorized to be
deducted by law or custom.

                  (f)      No additional compensation shall be due to you for
services performed or offices held in any subsidiary, division, affiliate, or
venture of DFC or DMC.

         4.       MISCELLANEOUS PROVISIONS RELATING TO THE BONUS AND OTHER
                  MATTERS

                  (a)      Your acceptance of this Agreement will confirm that
you understand and agree that the granting of the incentive compensation
referred to in Section 3(b) (the "incentive compensation"), and any action
thereunder, does not involve any statement or representation of any kind by DFC
or DMC as to their business, affairs, earnings or assets, or as to the tax
status of the incentive compensation or the tax consequences of any payment
thereof, or otherwise. You further agree that any action at any time taken by
or on behalf of DFC or DMC or by their directors or any committee thereof,
which might or shall at any time adversely affect you or the incentive
compensation, may be freely taken notwithstanding any such adverse effect
without your being thereby or otherwise entitled to any right or claim against
DFC, DMC, or any other person or party by reason thereof.

                  (b)      The incentive compensation is personal to you and,
except as provided as contemplated in Section 3(b) above, in the event of your
death or incapacity, is not transferable or assignable either by your act or by
operation of law, and no assignee, trustee in bankruptcy, receiver or other
party whosoever shall have any right to demand any incentive compensation or
any other right with respect to it. If, in the event of your death or
incapacity, your legal representative shall be entitled to demand the incentive
compensation under any of the provisions hereof then, unless otherwise
indicated by the context or otherwise required by any term hereof, references
to "you" shall apply to said representative.

                  (c)      If and when questions arise from time to time as to
the intent, meaning or application of any one or more of the provisions hereof
such questions will be decided by the Board of Directors of DFC or any
Committee appointed to consider such matters, or, in the event DFC is merged
into or consolidated with any other corporation, by the Board of Directors (or
a Committee appointed by it) of the surviving or resulting corporation, and the
decision of such Board of Directors or Committee, as the case may be, as to
what is a fair and equitable settlement of each such question or as to what is
a fair and proper interpretation of any provision hereof or thereof, whatever
the effect of such a decision may be, beneficial or adverse, upon the incentive
compensation, shall be conclusive and binding and you hereby agree that the
incentive compensation is granted to and accepted by you subject to such
condition and understanding. You understand that the incentive compensation is
not held or set aside in trust and (1) DFC or DMC may seek to retain, offset,
attach or similarly place a lien on such funds in circumstances where you have
been discharged for cause and shall be entitled to do so for (x) malfeasance
damaging to DFC or DMC, (y) conversion to you of opportunity of DFC or DMC, or
(z) a violation of DFC's conflict of interest policy, in each case as
determined in the sole discretion of the Board of Directors, and (2) in the
event DFC is unable


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Mr. Edison Velez
As of March 5, 2002
Page 4


to make any payment under this Agreement because of insolvency, bankruptcy or
similar status or proceedings, you will be treated as a general unsecured
creditor of DFC or DMC and may be entitled to no priority under applicable law
with respect to such payments.

         5.       RESTRICTIONS ON COMPETITION

                  During the term of this Agreement and for a period of one
year after you cease to be an employee of DFC or an affiliate of DFC or DMC,
you will not, without the prior written consent DFC or DMC, (a) accept
employment or render service to any person, firm or corporation, directly or
indirectly, in competition with DFC or DMC, or any affiliate thereof for any
purpose which would be competitive with the mortgage banking business (the
"Restricted Business") within the Commonwealth of Puerto Rico (the "Restricted
Area") or (b) directly or indirectly, enter into or in any manner take part in
or lend your name, counsel or assistance to any venture, enterprise, business
or endeavor, whether as proprietor, principal, investor, partner, director,
officer, employee, consultant, adviser, agent, independent contractor or in any
other capacity whatsoever for any purpose which would be competitive with the
Restricted Business in the Restricted Area. An investment not exceeding 5% of
the outstanding stock in any corporation regularly traded on any national
securities exchange or in the over-the-counter market shall not be deemed to
violate this provision, provided that you shall not render any services for
such corporation.

         6.       TERMINATION OF EMPLOYMENT

                  (a)      Your employment hereunder may be terminated for
dishonesty, death, incapacity, or inability to perform the duties of your
employment on a daily basis, resulting from physical or mental disability
caused by illness, accident or otherwise or refusal to perform the duties and
responsibilities of you employment hereunder, or breach of fidelity to DFC or
DMC.

                  (b)      At any time following a "Change in Control" of DFC,
this Agreement may be terminated by DFC or you on 30 days' written notice to
you or DFC, as the case may be, such termination to be effective as of the end
of the calendar year during which such notice is given. As used herein, a
"Change in Control" shall be deemed to have occurred at such time as any person
other than DFC or an entity controlled by or under common control with DFC
ceases to be the owner of at least 51% of the outstanding voting securities of
DMC.

                  (c)      If at any time you shall voluntarily terminate your
employment, then this Agreement, except for Section 5 hereof, shall terminate
and all further obligations of DFC hereunder shall cease, provided that in any
termination pursuant to subsection (b) of this Section 6 you shall be entitled
to receive all compensation due to pursuant to Section 3 hereof for the
calendar year in which such date of termination occurs.

             You agree that this Section 6 shall create no additional rights in
you to direct the operations of DFC.


<PAGE>


Mr. Edison Velez
As of March 5, 2002
Page 5


         7.       WAIVERS AND MODIFICATIONS

                  No waiver by either party of any breach by the other of any
provisions hereof shall be deemed to be a waiver of any later or other breach
thereof, or as a waiver of any such or other provision of this Agreement. This
Agreement sets forth all of the terms of the understandings between the parties
with reference to the subject matter set forth herein and may not be waived,
changed, discharged or terminated orally or by any course of dealing between
the parties, but only by an instrument in writing signed by the party against
whom any waiver, change, discharge or termination is sought.

         8.       SEVERABILITY

                  Wherever possible, each provision of this Agreement shall be
interpreted in such manner as to be effective under applicable law. In the
event that any provision, or any portion of any provision, of this Agreement
shall be held to be void and unenforceable, the remaining provisions of this
Agreement, and the remaining portion of any provision found void or
unenforceable in part only, shall continue in full force and effect.

         9.       ARBITRATION

                  Any dispute arising under this Agreement shall be submitted
to arbitration in San Juan, Puerto Rico under the rules of the American
Arbitration Association.

         10.      NOTICES

                  Any notice or communication required or permitted to be given
hereunder shall be deemed duly given if delivered personally or sent by
registered or certified mail, return receipt requested, to the address of the
intended recipient as herein set forth or to such other address as a party may
theretofore have specified in writing to the other by delivering or mailing in
a similar manner. Any notice or communication intended for DFC or DMC shall be
addressed to the attention of their respective Boards of Directors.

         11.      GOVERNING LAW

                  This Agreement shall be construed in accordance with the laws
of the Commonwealth of Puerto Rico.

         12.      MISCELLANEOUS

                  This Agreement shall be binding upon the successors and
assigns of DFC and DMC. This Agreement is personal to you, and you therefore
may not assign your duties under this Agreement. The headings of the Sections
of this Agreement are inserted for convenience only and shall not be deemed to
constitute a part thereof or to affect the meaning hereof.


<PAGE>


Mr. Edison Velez
As of March 5, 2002
Page 6


                  If the foregoing terms and conditions correctly embody your
mutual understanding with DFC and DMC, kindly endorse your acceptance and
agreement therewith in the space below provided, whereupon this shall become a
binding agreement.


                                    Very truly yours,

                                    DORAL FINANCIAL CORPORATION


                                    By:   /s/   Salomon Levis
                                       ----------------------------------------
                                    Name:       Salomon Levis
                                    Title:      Chairman of the Board and
                                                Chief Executive Officer


                                    DORAL MORTGAGE CORPORATION


                                    By:   /s/   Salomon Levis
                                       ----------------------------------------
                                    Name:       Salomon Levis
                                    Title:      Chairman of the Board


Accepted and Agreed to
as of the date first
above set forth:


    /s/ Edison Velez
---------------------------
        Edison Velez


<PAGE>


                                                                      EXHIBIT A


                              DEFERRED ARRANGEMENT

         1.       Creation of Accounts by DMC.

                  (a)      DMC shall create and maintain in its records a
Deferred Bonus Account for you with respect to the Deferred Bonus, if any,
earned by you under the Agreement. To that Account shall be credited the
Deferred Bonus and all interest earned thereon.

                  (b)      DMC shall not segregate the amounts credited to you
but may utilize such amounts for such purposes as it deems appropriate,
including working capital.

                  (c)      The Account shall bear interest (calculated on the
basis of a 360 day year consisting of twelve 30 day months) at the rate of
interest publicly announced by the Chase Manhattan Bank, N.A., New York, New
York as its "Reference Rate" on the first day of each calendar quarter less one
percentage point, which amount shall be credited to each Account as of the end
of each quarter in each year and such interest shall thereafter become a part
of the Account.

                  (d)      DMC may withhold from the amount payable with
respect to the Deferred Bonus account, any amount which it deems necessary to
withhold by reason of applicable federal, state, Puerto Rican or municipal
income, withholding, social security, state disability insurance or similar or
other taxes or other items which may be required or authorized to be deducted
by law or custom.

         2.       Termination of Right to Deferred Bonus.

                  (a)      Your right to any Deferred Bonus Account hereunder
may be terminated for dishonesty or if you otherwise breach the provisions of
your employment agreement with DMC, including the provisions of Section 5
thereof.

                  (b)      On your death or legally determined incapacity, your
Deferred Bonus Account shall be deemed to have been transferred to your legal
representative who may within twelve months after your death or legally
determined incapacity demand payment of all your Deferred Bonus Account whether
or not five years shall have elapsed since the accrual of the Deferred Bonus
giving rise to the Deferred Bonus Account.

         3.       Management and Statutory Creditor.

                  You acknowledge that you have no right to restrict or in any
way affect the management policies or decisions of DMC and that you shall not
obtain any status as a creditor of DMC.

         4.       Payment of Deferred Bonus, Notice, Withholding.

                  (a)      Subject to Sections 2(a) and 2(b), you shall be
entitled to receive on demand the full amount of your Deferred Bonus Account
five (5) or more years after such Deferred Bonus was earned.

                  (b)      Demand for payment of the Deferred Bonus Account
shall be made by written notice, addressed to the Chairman of the Board of DMC,
specifying the amount of the then receivable Deferred Bonus Account and
requesting its payment at any time during which it is then payable. Payment
shall ordinarily be made to you within 30 days after request.

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