Exhibit 10.18
Chicago Mercantile Exchange Inc.
Registration Statement on Form S-4
SEPARATION AGREEMENT AND GENERAL RELEASE
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THIS SEPARATION AGREEMENT and GENERAL RELEASE (hereinafter
"Agreement") is made and entered into by and between XXXXXX X. XXXXX
(hereinafter "Xxxxx") and THE CHICAGO MERCANTILE EXCHANGE, however constituted
or organized, and its successors or assigns (hereinafter collectively referred
to as "CME"), an Illinois not-for-profit corporation.
WHEREAS, the parties have engaged in discussions resulting in an
amicable and mutually satisfactory agreement concerning Xxxxx'x resignation from
his employment with CME or any related entity, and all matters arising out of or
relating thereto;
NOW, THEREFORE, in consideration of the mutual covenants and promises
set forth below, the parties hereby agree as follows:
1. The Employment Agreement. Xxxxx and CME are parties to an
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"Agreement" dated April 12, 1996, and amended December 10, 1999, with a term
extending through April 12, 2001 (hereinafter "Employment Agreement"). Except
for the obligations set forth in Paragraphs 6, 8, and 9 thereof, which shall
continue, or except as otherwise expressly provided in this Agreement, the terms
and provisions of this Agreement shall supersede the terms and provisions of the
Employment Agreement, which is terminated effective April 12, 2000, and shall
thereafter be null and void and without further effect. In the event of any
conflict or inconsistency between this Agreement and the Employment Agreement,
the terms of this Agreement shall take precedence.
2. Xxxxx'x Resignation. Xxxxx has resigned his employment with CME
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and all of the Released parties, and his position on all committee and boards
effective April 12, 2000. However, Xxxxx shall provide reasonable transition
assistance and cooperation for a reasonable period of time in light of his
ability to obtain full time employment elsewhere with respect to his former
duties to CME after that date. During his employment through April 12, 2000,
Xxxxx shall continue to receive all compensation, as well as insurance,
vacation, fringe, pension and retirement benefits due to him under and pursuant
to the terms of the Employment Agreement; it being understood that Xxxxx shall
be allowed reasonable time to pursue other employment opportunities and he will
be on vacation from March 27, 2000 until April 4, 2000. Xxxxx acknowledges that
he has reviewed and approved the announcement of his resignation prepared by CME
as set forth in Exhibit A attached hereto, and distributed on or about March 21,
2000.
3. The Obligations of CME. Upon the Resignation Date, and in
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consideration of the promises of Xxxxx contained in this Agreement, CME shall be
obligated to Xxxxx as set forth herein. Except as expressly set forth in this
Agreement, CME shall have no obligation to Xxxxx of any kind or nature
whatsoever. On or before May 1, 2000, and provided that this Agreement is not
revoked pursuant to Section 8(iii) of this Agreement CME shall pay to Xxxxx as
severance pay the sum of One Million Dollars ($1,000,000) less applicable
federal and state withholding deductions. It is understood that the sum
satisfies CME's obligations for Xxxxx'x accrued and unused vacation as of April
12, 2000 and Xxxxx acknowledges that no additional sums are due with respect to
vacation. It is further understood that no additional sums are due or owed to
Xxxxx for future or past bonuses, severance pay under any plan or policy or for
any other form of compensation except as provided in Paragraph 7 below. It is
further understood that should Xxxxx revoke or not sign this Agreement, he has
and shall be offered the
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position of Executive Consultant to CME's Chief Executive Officer as previously
discussed with him.
4. Business Expenses. On or before April 12, 2000, CME shall pay to
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Xxxxx, in a single lump sum, an amount equal to all reimbursements which Xxxxx
has or may claim with respect to business and transportation expenses incurred
by him on behalf of CME through April 12, 2000 in accordance with CME's
policies. There shall be no reimbursement of Xxxxx for any other business and
transportation expenses incurred by him after April 12, 2000 except as provided
in Paragraph 9 of the Employment Agreement.
5. In the event of Xxxxx'x death prior to receipt of any payments to
be made to him hereunder, such payment shall be made to his estate.
6. Insurance Continuation. Effective May 1, 2000 Xxxxx shall be
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eligible to participate in CME's health, dental and vision insurance plans in
accordance with the terms of such plans for former employees pursuant to the
Consolidated Omnibus Budget Reconciliation Act ("COBRA"), at his cost. Such
coverages will terminate upon Xxxxx obtaining other employment which offers
comparable insurance coverage and when he first becomes eligible for such
coverage. Xxxxx agrees that he will promptly notify CME upon obtaining such
coverage. Xxxxx shall have no duty to seek or obtain other employment.
7. Xxxxx shall be eligible for payments, benefits and any rollover or
other options available under CME's Pension Plan for Employees, the Tax
Efficient Savings Plan, the SMSDSP, and the Supplemental Executive Retirement
Plan in accordance with the terms and restrictions as applicable to him
consistent with an employment termination date of April 12, 2000. In addition
his eligibility for benefits under all other insurance and other benefit plans,
if
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any, shall be determined in accordance with the terms and restrictions of such
plans as applicable to him consistent with an employment termination date of
April 12, 2000.
8. Mutual General Releases and Indemnification. Except for a claim
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based upon an alleged breach of this Agreement, Xxxxx, for himself and for
anyone claiming through him, including his estate, heirs, personal
representatives, executors, administrators, agents and assigns, hereby releases,
forever discharges and agrees not to xxx CME, any parent, subsidiaries and
related and affiliated entities, and each of its and their officers, directors,
representatives, agents, employees, related and participating members, insurers,
as well as each of its and their respective estates, heirs, personal
representatives, executors, administrators, successors and assigns (hereinafter
collectively and individually the "CME Releasees"), and CME, its parents,
subsidiaries and related and affiliated entities, hereby releases, forever
discharges, and agrees not to xxx Xxxxx, his estate, heirs, personal
representatives, executors, administrators, agents and assigns, from any and all
rights, claims, demands, debts, dues, sums of money, accounts, attorneys' fees,
complaints, judgments, executions, actions and causes of action of any nature
whatsoever, cognizable at law or equity, past, present or future, which either
party now has or claims, or might hereafter have or claim, against the other
party, based upon or arising out of any matter or thing whatsoever from the date
of Xxxxx'x initial employment with CME through the date of this release,
including, without limitation, any claim, action or cause of action which was or
is related to or arises out of Xxxxx'x employment with CME, or his separation
and/or resignation therefrom, or which is based upon or arises under the
Employment Agreement, or any local, state or federal law dealing with employment
discrimination, including, without limitation, Title VII of the Civil Rights Act
of 1964, as amended, the Civil Rights Act of 1991, the Americans with
Disabilities Act, the Age Discrimination in Employment Act, the Illinois
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Human Rights Act, the Chicago Human Rights Ordinance or any common law tort,
contract or other claim. CME further agrees to fully indemnify and hold Xxxxx
harmless for any claims by any individual or entity against Xxxxx relating to
Xxxxx'x actions or omissions while employed by CME, as provided in CME's by-
laws.
The following provisions are applicable to and made a part of this
Agreement and the foregoing general release and waiver.
(i) In exchange for this general release and waiver, Xxxxx hereby
acknowledges that he has received separate consideration beyond that
which he is otherwise entitled to under any CME policy or program,
the Employment Agreement, or applicable law.
(ii) CME hereby expressly advises Xxxxx to consult with an attorney of his
choosing prior to executing this Agreement which contains a general
release and waiver and Xxxxx acknowledges that he has consulted with
an attorney of his choice.
(iii) Xxxxx has twenty-one (21) days from the date of presentment to
consider whether or not to execute this Agreement. In the event of
such execution, Xxxxx has a further period of seven (7) days from
such date in which to revoke said execution, notice of which must be
received by CME within such seven (7) day period.
9. Non-Disparagement. Xxxxx represents that he has not and will
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not, nor will he cause or assist another person to, disparage or make defamatory
statements about CME or the other CME Released Parties to any third parties. CME
represents that its present executive officers and present officers of CME's
Board of Directors have not and will not cause or assist another person to
disparage or make defamatory statements about Xxxxx to any third parties.
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CME agrees that any reference it provides to prospective employers of Xxxxx or
other third parties shall be in substantial conformity with the provisions of
this Paragraph 6 and in the form of Exhibit B, attached hereto and incorporated
herein.
10. Confidentiality of Agreement. The parties agree that this
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Agreement and all of its terms and provisions are strictly confidential, and
shall not be divulged or disclosed in any way to any person other than their
legal counsel, tax or financial advisors, to Xxxxx'x spouse, pursuant to lawful
subpoena or similar legal process, and with respect to CME in the course of
customary business reporting or making disclosures required by law. Should
either party choose to divulge the terms and conditions of this Agreement to his
or its legal counsel or Xxxxx'x spouse, tax or financial advisor he or it shall
insure that they will be similarly bound to protect its confidentiality and that
a breach of this Paragraph by such party's legal counsel or Xxxxx'x spouse, tax
or financial advisor shall be considered a breach of this Paragraph by such
party.
11. The Obligations of Xxxxx. In consideration of the promises of
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CME contained in this Agreement, and other good and valuable consideration, the
receipt and sufficiency of which is hereby acknowledged, Xxxxx, in addition to
the mutual promises contained in Paragraphs 5, 6 and 7 herein, hereby agrees to
abide by the obligations contained in Paragraphs 6, 8 and 9 of the Employment
Agreement.
12. Effective Date. The Effective Date of this Agreement shall be
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the eighth day after Xxxxx'x execution of this Agreement without receipt by CME
of a signed statement from Xxxxx revoking such execution. All obligations of
the parties contained in this Agreement shall, in addition to any other express
requirement, be conditioned upon and shall not be effective until the Effective
Date of this Agreement as defined in this Paragraph.
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13. Arbitration. Any controversy or claim arising out of or relating
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to this Agreement shall be resolved in accordance with the procedures contained
in Paragraph 7 of the Employment Agreement.
14. Binding Effect. This Agreement shall be binding upon and inure
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to the benefit of the heirs, assigns, administrators, executors, and legal
representatives of Xxxxx, and shall be binding upon and inure to the benefit of
the CME Releasees. Both parties represent that they have all necessary legal
authority to execute this Agreement.
15. Entire Agreement. This instrument constitutes the entire
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Agreement between the parties. It may not be amended or modified except by a
subsequent written instrument signed by both parties hereto.
16. Governing Law. This Agreement shall be construed in accordance
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with the laws of the State of Illinois.
17 Counterparts. This Agreement may be signed in multiple
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counterparts, each of which shall be deemed to be an original for all purposes.
18. Acknowledgement. Xxxxx acknowledges that he has carefully read
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and fully understands the terms and provisions of this Separation Agreement and
General Release, has been represented in this matter by counsel of his own
choosing, and that his execution of this Separation Agreement and General
Release is voluntary. The parties 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 to or against any party
hereto.
IN WITNESS WHEREOF, the parties have executed this Agreement on the date(s) set
forth below.
THE CHICAGO MERCANTILE EXCHANGE
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By:_____________________________ ______________________________________
Xxxxxx X. Xxxxx
Title:__________________________ Date:_________________________________
Date:___________________________
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EXHIBIT A
[FOR XXXXXX LETTERHEAD]
March _____, 2000
To All members and CME Staff:
Please be advised that Xxxxx Xxxxx, our Executive Vice President and Chief
Operating Officer, has resigned from the Exchange, effective April 12/th/.
Xxxxx has been an important contributor to the success of the CME in the last
two decades, having first started at the Exchange in 1979. During his career
here, Xxxxx held the positions of In-house Counsel, Vice President, Legal,
Senior Vice President, Legal & Regulatory Affairs, Executive Vice President and
Chief Financial Officer, Executive Vice President & Chief Administrative
Officer, and Executive Vice President & Chief Operating Officer. His breadth of
experience, and his familiarity with virtually every facet of our operations,
has benefited us greatly over the years.
In addition to his many responsibilities, Xxxxx set the standard for service to
our membership, acting as the principal liaison between the membership and the
staff. Throughout his career at the CME, Xxxxx worked tirelessly to balance the
competing demands of the various constituencies at the Exchange. His ability to
work well with members and staff, and his ability to reach consensus on complex
issues, has helped us through many difficult times. I am particularly grateful
to Xxxxx for his longstanding and unwavering commitment to the CME and for his
exemplary work ethic.
Please join us in wishing Xxxxx tremendous success in his future endeavors.
(Xxxxx'x signature - first name only)
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