Exhibit 10.10
Chicago Mercantile Exchange Inc.
Registration Statement on From S-4
EMPLOYMENT AGREEMENT
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This Employment Agreement ("Agreement") is entered into by and between the
CHICAGO MERCANTILE EXCHANGE ("CME") and XXXXXX X. XXXXX ("Xxxxx") this 10th day
of December, 1999.
WHEREAS, the parties desire to enter into this Agreement pertaining to the
employment of Xxxxx by the CME.
NOW, THEREFORE, in consideration of the mutual promises and covenants set
forth below, the parties hereby agree as follows:
1. Employment. Subject to the terms of this Agreement, the CME hereby
agrees to employ Xxxxx during the Agreement Term as Executive Vice President and
Chief Operating Officer, and Xxxxx hereby accepts such employment. Xxxxx shall
report directly to the President of the CME. As Executive Vice President and
Chief Operating Officer, Xxxxx shall have overall responsibility for the
following departments and/or operations of the CME: Finance; Administration;
Legal; Personnel; Regulatory; Internal Auditing; MIS; and Operations. Xxxxx
shall also assist the President as the President's liaison to the CME staff, and
shall perform such other duties as may be assigned to him by the President or
Board of Directors of the CME. These duties may be changed from time-to-time as
determined by the President or Board of Directors of the CME, provided that any
such duties shall be consistent with the position of Executive Vice President
and Chief Operating Officer. During his employment, Xxxxx agrees to devote his
full time, energies and talents to serving as Executive Vice President and Chief
Operating Officer of
the CME, and to perform his duties faithfully, efficiently and in good faith,
subject to the direction of the President and/or Board of Directors of the CME.
2. Agreement Term. The Agreement Term shall be for a term through April
12, 2001. Unless renewed by the mutual written agreement of the parties, this
Agreement will automatically terminate upon the expiration of the Agreement
Term. The CME will give Xxxxx written notice of its intention to renew or not
renew or to renegotiate the terms of the Agreement at least sixty (60) days
prior to expiration. In the absence of renewal, upon expiration of this
Agreement, Xxxxx shall be an employee of the CME working without a contract.
3. Compensation. During the Agreement Term and while employed by the CME,
the CME shall compensate Xxxxx as follows:
a. Base salary. Xxxxx shall be paid an annual base salary of five
hundred twenty two thousand and five hundred ($522,500), payable in equal bi-
weekly installments. Annual increases, if any, shall be as determined by the CME
in accordance with its policies and practices with respect to executive
compensation.
b. Benefits. Subject to their terms, Xxxxx and any of his eligible
dependents shall be entitled to participate in all fringe benefits and benefit
plans of the CME under the same terms and conditions as are generally applicable
to the employees and officers of the CME as those fringe benefits and benefit
plans currently exist and/or as they may be amended from time to time during the
Agreement Term.
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c. Bonus. Subject to its terms, Xxxxx shall participate in the CME's
discretionary bonus program.
4. Termination. Xxxxx'x employment with the CME during the Agreement
Term may be terminated only under the following circumstances:
a. Death. Xxxxx'x employment hereunder will terminate upon his death.
b. Disability. If Xxxxx is disabled, and receiving benefits under
the CME's long term disability insurance program, the obligations under this
Agreement shall be suspended for the duration of such disability. In the event
Xxxxx returns to the position set forth herein during the term of this
Agreement, the provisions of this Agreement shall be reinstated. In the event
Xxxxx returns to work in a different position, or does not return to work at all
upon conclusion of his disability, this Agreement shall be deemed terminated.
c. Cause. Xxxxx'x employment hereunder may be immediately terminated
by the CME for cause. For purposes of this Agreement, "cause" shall be defined
as misconduct, incompetence, failure to perform and/or neglect of duties which
is gross or willful, and shall include actions by Xxxxx which occur outside of
the CME which would have a substantial likelihood of bringing significant
discredit upon the CME.
d. Termination by Xxxxx. This Agreement may be terminated by Xxxxx
at any time and for any reason by the giving
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of at least sixty (60) days advance written notice of same to the CME.
5. Payments Upon Termination or Expiration.
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a. In the event of termination of Xxxxx pursuant to Paragraphs 4a or
4b of this Agreement, the CME shall for a period of six (6) months following
such termination continue Xxxxx'x base salary (or pay same to his estate).
b. In the event of termination of Xxxxx by the CME pursuant to
Paragraph 4(c) of this Agreement, or upon expiration of the Agreement Term, the
CME shall pay to Xxxxx only any accrued, but unused, vacation pay.
c. In the event Xxxxx terminates this Agreement pursuant to Paragraph
4d herein with less than the sixty (60) days advance written notice of same, the
parties acknowledge that the CME will be damaged thereby, but that such damages
will be difficult to calculate. Accordingly, Xxxxx will promptly pay to the
CME, or allow set off against any monies it may then owe to Xxxxx, as
liquidated damages a sum equal to his base salary, computed daily, for each day
his notice of termination under Paragraph 4(d) is less than sixty (60) days.
6. Confidentiality. Xxxxx acknowledges that in his employment he is or
will be making use of, acquiring or adding to the CME's Confidential
Information which includes (but is not limited to) memoranda and other materials
or records of a proprietary nature; technical data, records and policy matters
relating to new business development, research, strategy,
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finance, accounting, marketing, personnel, clearing, management, and operations.
Therefore, in order to protect such Confidential Information and to protect
other employees who depend on the CME for regular employment, Xxxxx agrees that
he will not during or after the term of his employment in any way utilize any of
said Confidential Information, except in connection with his employment by the
CME, and he will not copy, reproduce, or take with him the original or any
copies of said Confidential Information and he will not disclose any of said
Confidential Information to anyone. Further, Xxxxx agrees to advise any new
employer of the terms of this Agreement regarding Confidential information.
These restrictions regarding Confidential Information shall be in addition to
those which exist at common law or by statute.
7. Arbitration; Equitable Remedies.
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Any controversy or claim arising out of or relating to this Agreement or
the validity, interpretation, enforceability or breach thereof, which is not
settled by agreement of the parties, shall be settled by arbitration conducted
in the City of Chicago, in accordance with the Rules of the American Arbitration
Association, and judgment upon the award rendered in such arbitration may be
entered in any court having jurisdiction. The arbitration shall be conducted
before a single arbitrator selected by the parties. In the event the parties
cannot agree on an arbitrator, then the Association will supply both parties
with a list of seven names. The parties will alternatively
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strike one name until only one remains. First choice will be determined by a
coin toss, the winning party having the option of striking first. All expenses
of arbitration shall be borne equally by the parties, except for attorneys' fees
which shall be borne entirely by each party. The arbitrator shall have no power
to amend, alter, add to or delete from this Agreement.
Xxxxx acknowledges that the CME would be irreparably injured by a violation
of Paragraph 6 and he agrees that the CME, in addition to any other remedies
available to it for such breach or threatened breach, shall be entitled to a
preliminary injunction, temporary restraining order, or other equivalent relief,
restraining Xxxxx from any actual or threatened breach of Paragraph 6 pending
and in aid of arbitration of the dispute. If a bond is required to be posted in
order for the CME to secure an injunction or other equitable remedy, the parties
agree that such bond need not be more than a nominal sum.
8. Return of Property. Upon his last day of active work, Xxxxx hereby
agrees to immediately turn over to the CME any keys, credit cards, passes, and
all notes, memoranda, records, documents, computer disks, and all other
information, no matter how produced or reproduced, kept by Xxxxx or in his
possession or control, used in or pertaining to the business of the CME, it
being hereby acknowledged that all of said items are the sole and exclusive
property of the CME.
9. Defense of Claims. During the period of his employment by the CME, and
for periods after the termination of his
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employment, Xxxxx shall reasonably cooperate with the CME at its request in the
defense or prosecution of any claim that may be made by or against the CME. Such
cooperation shall include, without limitation, serving as a witness at trial or
hearing, being deposed, and preparation for same. For the period after Xxxxx
terminates his employment with the CME, the CME shall reimburse Xxxxx for all
reasonable expenses in connection therewith, including travel expenses, and
shall compensate him at a daily rate equal to his annual base salary on the date
his employment with the CME terminates, divided by 260, with days used for
preparation, travel and other related matters being included for purposes of
determining the compensation due to Xxxxx. Less than full days shall be paid for
by the hour, determined by dividing the daily rate by eight. To the extent
reasonably practicable, the CME shall provide Xxxxx with notice at least ten
days prior to the date on which any such travel is required.
10. Nonalienation. The interests of Xxxxx under this Agreement are not
subject in any manner to anticipation, alienation, sale, transfer, assignment,
pledge, encumbrance, attachment, or garnishment by creditors of Xxxxx or Xxxxx'x
beneficiaries.
11. Amendment. This Agreement may be amended or cancelled only by the
subsequent mutual written agreement of the parties.
12. Applicable Law. The provisions of this Agreement shall be construed in
accordance with the laws of the State of
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Illinois, without regard to the conflict of law provisions of any state.
13. Waiver of Breach. No waiver of any party hereto of a breach of any
provision of this Agreement by any other party, or of compliance with any
condition or provision of this Agreement to be performed by such other party,
will operate or be construed as a waiver of any subsequent breach by such other
party or any similar or dissimilar provisions and conditions at the same or any
prior or subsequent time. The failure of any party hereto to take any action by
reason of such breach will not deprive such party of the right to take action at
any time while such breach continues.
14. Notices. Notices and all other communications provided for in this
Agreement shall be in writing and shall be delivered personally or sent by
registered or certified mail, return receipt requested, postage prepaid, or sent
by facsimile or prepaid overnight courier to the parties at, respectively, the
business address of the CME in care of its President and the home address of
Xxxxx (or to Xxxxx at the business address of the CME if Xxxxx is employed there
at the time of such notice). Such notices and other communications shall be
deemed given:
a. in the case of delivery by overnight service with guaranteed next
day delivery, the next day or the day designated for delivery;
b. in the case of certified or registered U.S. mail, five days after
deposit in the U.S. mail; or
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c. in the case of facsimile, the date upon which the transmitting
party received confirmation of receipt by facsimile, telephone or otherwise;
provided, however, that in no event shall any such communications be deemed to
be given later than the date they are actually received.
15. Severability. If any provision, section, subsection or other portion
of this Agreement shall be determined by any court of competent jurisdiction to
be invalid, illegal or unenforceable in whole or in part, and such determination
shall become final, such provision or portion shall be deemed to be severed or
limited, but only to the extent required to render the remaining provisions and
portions of this Agreement enforceable. This Agreement as thus amended shall be
enforced so as to give effect to the intention of the parties insofar as that is
possible. In adaition, the parties hereby expressly empower a court of competent
jurisdiction to modify any term or provision of this Agreement to the extent
necessary to comply with existing law and to enforce this Agreement as modified.
16. Survival of Agreement; Successors. Except as otherwise expressly
provided in this Agreement, the rights and obligations of the parties to this
Agreement shall survive the termination of Xxxxx'x employment with the CME. In
the event of a merger, sale, reorganization or other change of control, this
Agreement shall be binding upon and inure to the benefit of any successor of the
CME.
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17. Entire Agreement. This Agreement constitutes the entire agreement
between the parties concerning the subject matter hereof and supersedes all
prior and contemporaneous agreements, if any, between the parties relating to
the subject matter hereof.
18. Counterparts. This Agreement may be signed in multiple counterparts,
each of which shall be deemed to be an original for all purposes.
19. Acknowledgement by Xxxxx. Xxxxx represents that he is knowledgeable
and sophisticated as to business matters, including the subject matter of this
Agreement, that he has read this Agreement and that he understands its terms.
Xxxxx acknowledges that, prior to assenting to the terms of this Agreement, he
has been given a reasonable time to review it, to consult with counsel of his
choice, and to negotiate at arm's-length with the CME as to the contents. Xxxxx
and the CME agree that the language used in this Agreement is the language
chosen by the parties to express their mutual intent, and that no rule of strict
construction is to be applied against any party hereto.
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IN WITNESS WHEREOF, the parties have executed this Agreement on the date(s)
set forth below.
CHICAGO MERCANTILE EXCHANGE
By /s/ Xxxxxxx Xxxxxxx
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Title: President
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Date: 4/12/96
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/s/ Xxxxxx X. Xxxxx /s/ Xxxxxx X. Xxxxx
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Xxxxxx X. Xxxxx
Date 4-12-96 12/10/99
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