EXHIBIT 10.18
EXECUTIVE AGREEMENT
AGREEMENT made and effective as of the 21st day of September, 2001 by and
among NYFIX, Inc. a New York corporation with its principal office at 000 Xxxxxx
Xxxxxx, Xxxxxxxx, XX 00000 and its subsidiary office at 0-0 Xxxxxxxx Xxxxxx,
Xxxxxx, XX (hereinafter "Employer" or "Company"), and XX. XXXXXX XXXXXX, 00
Xxxxxxxxx Xxx, Xxxxxxx, XX 00000 (hereinafter "Executive").
WHEREAS, Employer is in the business of developing and marketing advanced
electronic trading systems to brokerage firms and international global exchanges
trading in equities, currencies and futures and options and has formed an
affiliate NYFIX Millennium LLC, (hereinafter "NYFIX Millennium") that is
co-owned by the Company and a consortium of business partners. NYFIX Millennium
is designed as an integrated ATS (alternative trading system), exchange access
and best execution system and will leverage existing infrastructure deployed by
the Company's NYFIX Network and FIX engine technology, and
WHEREAS, Employer desires to retain the services of Executive for the
period provided in this Agreement, and Executive is willing to serve in the
employ of Employer on a full-time basis for said period upon the terms and
conditions hereinafter set forth;
NOW, THEREFORE, in consideration of the mutual covenants herein contained,
the parties hereto agree as follows:
1. EMPLOYMENT. Employer agrees to employ Executive, and Executive agrees to
enter the employ of the Employer for the period stated in section 3 hereof and
upon the other terms and conditions set forth herein.
2. POSITION AND RESPONSIBILITIES. During the period of his employment
hereunder, Executive agrees to serve as the Chief Executive Officer of NYFIX
Millennium, and report directly to Xxxxx Xxxxxxxxx Xxxxxx, CEO and President of
the Company.
3. TERM OF EMPLOYMENT. The period of Executive's employment under this
Agreement shall be deemed to have commenced as of October 5, 2001, and shall
continue for a period of one year until October 4, 2002 (the "Term"). The Term
shall be automatically renewed in one-year increments unless terminated as
provided herein, or unless either party gives 60 days prior written notice of
its intention to discontinue the automatic extension.
4. DUTIES. During the period of his employment hereunder and except for
illness, vacation periods, and reasonable leaves of absence, Executive shall
devote substantially all of his business time, attention, skill, and efforts to
the faithful performance of his duties hereunder.
In addition to paid holidays, as defined by the Company's holiday
schedule, Executive shall receive a prorated (4) four week vacation in the first
calendar year of this Agreement, and 4 weeks paid vacation during each
subsequent calendar year of this Agreement.
5. COMPENSATION.
5.1. BASE SALARY: Employer shall cause NYFIX Millennium to pay Executive as
compensation for his services hereunder a total annual base salary of $400,000
plus a bonus of 2% on Millennium pre-tax earnings. Quarterly advances against
this bonus is subject to approval by the Company's CEO. Executive will also be
offered to participate in the Company's health insurance plan(s) and 401(k)
plan.
5.2. OTHER COMPENSATION: At any point of time the Company reserves the
right to extend special bonuses or incentives which could include stock option
grants. However, such arrangements are solely at management's discretion.
Executive shall also be entitled to participate in such other benefits as may
from time to time be generally made available to Employer's executives. This
contract is not obligating the company to extend such bonuses or incentives.
In addition to the above compensation, Executive will receive the following
stock-option grants:
i) A sign-up pre-grant of 225,000 options vesting over a 3
year period at a rate of 75,000 options vesting at the
end of "year 1," 75,000 options vesting at the end of
"year 2." and 75,000 options vesting at the end of "year
3"
ii) A bonus grant of 100,000 options, which shall vest
either on the date when NYFIX Millennium has earned
$50,000,000 in pre-tax earnings which must be achieved
cumulatively in consecutive quarters not to exceed four,
or at the end of year five.
These option grants are subject to the terms and conditions of the Company's
2001 Stock Option Plan and must be approved by the Option Committee of the Board
of Directors, at the next Board of Directors Meeting.
6. PAYMENT TERMS. The salary payment shall be made in accordance with the
usual payroll system of the Company, presently bi-weekly.
7. REIMBURSEMENT OF EXPENSES. Employer shall cause NYFIX Millennium to pay
or reimburse Executive for all reasonable travel and other expenses incurred by
Executive in performance of his obligations under this Agreement, provided that
such expenses are approved in advance by Employer.
8. CONFIDENTIALITY. Executive recognizes and acknowledges that Employer's
trade secrets, specific combination of use of third-party parts, proprietary
technology and software, and confidential information as may exist and be shared
with Executive from time to time are valuable, special, and unique assets of the
Employer. Employer and Executive recognize that access to and knowledge of such
technology and information is essential to the Executive's duties hereunder. In
return for his access and knowledge, Executive agrees that he will not, during
the term of this Agreement or at any time thereafter, disclose any such secrets,
technology, or information to any person, firm, corporation, or other entity for
any reason or purpose whatsoever, nor shall the Executive make use of any such
secrets, technology, or information for his own purposes or for the benefit of
any person, firm, corporation, or other entity under any circumstances during or
after the term of this Agreement.
9. NON-COMPETITION. Executive will not for the first 12 months following
termination of employment with the Company either directly or indirectly as a
sole proprietor, partner, stockholder, investor, officer or director of a
corporation, or as an executive, employee, agent, associate or consultant of any
person, firm, corporation or other entity, and without the Company's written
approval:
(i) engage in any activity or employment in the faithful performance
of which it could be reasonably anticipated to cause Executive to
use or disclose any confidential information or trade secrets of
the Company or NYFIX Millennium;
(ii) enter into employment with an ATS (alternative trading system) or
ECN (electronic communication network) organization using FIX
protocol to communicate equity order flow from customers to the
ECN and/or ATS execution facility, except if Executive is
terminated without cause.
10. ENFORCEMENT; SEVERABILITY. It is the desire and the intent of the
parties hereto that the provisions of this Agreement hereof be enforced to the
fullest extent permissible under the laws and public policy of the jurisdictions
in which enforcement is sought. Accordingly, if any particular portion or
provision of this Agreement shall be adjudicated to be invalid or unenforceable,
the remaining portion or such provision or the remaining provisions of this
Agreement, or the application of such provision or portion of such provision as
is held invalid or unenforceable to persons or circumstances other than those to
which it is held invalid or unenforceable, shall not be effected thereby.
11. TERMINATION. This Agreement may not be terminated during its term by
the Employer for any reason other than (i) a material breach by the Executive of
any of the terms of this Agreement, (ii) Executive engaging in conduct
materially injurious to the company, NYFIX Millennium, its affiliates, customers
or suppliers, (iii) Executive engaging in any act of fraud which would
constitute a felony under federal or state law.
Notwithstanding anything to the contrary contained herein, Employer may
terminate this Agreement (i) upon ten (10) days' written notice, in the event
that Executive is unable to perform his assigned duties and responsibilities due
to illness, physical or mental disability or any other reason, and such
disability continues for a period of 180 days within any twelve consecutive
months, or (ii) upon the death of the Employee.
The Executive shall have Good Reason for terminating his employment with
the Corporation under this Agreement if one or more of the following occurs:
(a) layoff or involuntary termination of the Executive's employment,
except in connection with the termination of the Executive's
employment as a result of termination for Cause, the non-renewal
of this Agreement or of the Executive's disability, death or
retirement;
(b) a reduction by the Corporation in the Executive's Base Salary; or
(c) any material violation by the Company of this Agreement;
Notwithstanding the foregoing, no action by the Company shall give rise to
a Good Reason if it results from the Executive's termination for Cause, death or
retirement, and no action by the Corporation specified in paragraphs (a) through
(c) of this section shall give rise to a Good Reason if it results from the
Executive's disability.
Should Employer involuntary terminate Executive's employment, and
involuntary termination occurs after Executive's six-month anniversary of
employment and involuntary termination is not as a result of a "Hostile
Acquisition," Executive will receive six months of base salary in one lump sum
payment, and an immediate vesting of the nearest options to be vested as
reflected in paragraph 5.2.i of this agreement, as severance at the effective
date of the involuntary termination; or Should the Employer involuntary
terminate Executive after the one year anniversary of employment, and not result
from a "Hostile Acquisition," Executive will receive one year of base salary in
one lump sum payment and an immediate vesting of the nearest options to be
vested as reflected in paragraph 5.2.i of this agreement as severance at the
effective date of the involuntary termination.
In the event NYFIX Millennium is involved in a "Hostile Acquisition," and should
the acquiring company terminate Executive's services, Executive will receive two
times Executive's annual base salary. In addition, fifty percent of any
"unvested" options will become fully vested.
In the event NYFIX Millennium should Merge with another Non-NYFIX Inc. owned
Company or NYFIX, Inc should Divest NYFIX Millennium, and Executive were to have
employment terminated, and if this event should occur following Executive's
second anniversary of employment, Executive will receive 100% vesting of
executive's bonus grant of 100,000 options mentioned above.
12. GOVERNING LAW AND VENUE. This Agreement shall be construed in
accordance with the laws of the State of New York.
13. NOTICES
Any notice required to be given pursuant to this Agreement shall be
effective only if in writing and delivered personally or by mail. If given by
mail, such notice must be sent by registered or certified mail, postage prepaid,
mailed to the parties at the addresses set forth on the signature page hereof,
or at such other addresses as the parties may designate, from time to time, by
written notice. Mailed notices shall be deemed received two (2) business days
after the date of deposit in the mail.
14. ASSIGNMENT: EFFECT ON AGREEMENT
It is hereby acknowledged and agreed that the Executive's rights and
obligations under this Agreement are personal in nature and shall not be
assigned or delegated. This agreement shall be binding on and inure to the
benefit of the heirs, personal representatives, successors and assigns of the
parties, subject, however, to the restrictions on assignment and delegation
contained herein.
15. ENTIRE AGREEMENT
This Agreement (and the Exhibits attached hereto which are part of this
Agreement) contains the entire agreement and understanding between the parties
and supersedes all prior agreements and understandings, oral or written. No
modification, termination or attempted waiver shall be valid, unless in writing
and signed by both parties.
IN WITNESS WHEREOF, the Parties hereto have executed this Agreement on the
21st day of September 2001:
NYFIX, Inc.
By: /s/ Xxxxx Xxxxxxxxx Xxxxxx
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Xxxxx Xxxxxxxxx Xxxxxx
Chief Executive Officer
EXECUTIVE:
/s/ Xxxxxx Xxxxxx
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Xxxxxx Xxxxxx
