EMPLOYMENT AGREEMENT
Exhibit 10.27
This
Agreement, dated as of March 11, 2010, is entered into by and among Xxxxxxx X. Xxxxx (the
“Executive”), SS&C Technologies Holdings, Inc., a Delaware corporation (together with any successor
thereto, the “Company”) and SS&C Technologies, Inc. (together with any successor thereto, “SS&C”).
WITNESSETH THAT
WHEREAS, the Company and the Executive wish to set forth the terms and conditions of
Executive’s employment with the Company and SS&C in a binding written agreement.
NOW, THEREFORE, in consideration of the mutual covenants set forth in this Agreement, it is
hereby agreed as follows:
1. Term of Employment. The term of the Executive’s employment under this Agreement (the
“Term”) shall begin on the date of this Agreement (the “Effective Date”) and end on the third
anniversary thereof; provided, that the Term shall be extended by successive periods of one (1)
year, unless the Company shall have notified the Executive or the Executive shall have notified the
Company that no such extension shall take place, in each case at least ninety (90) days prior to
the expiration of the then-current Term (a “Notice of Nonrenewal”); and provided, further, that the
Term shall in any event end upon a termination of employment in accordance with the terms of
Section 5 hereof.
2. Position, Duties and Location.
(a) Position. Beginning on the Effective Date, the Executive shall serve as Chairman of
the Board of Directors of the Company (the “Board”) and Chief Executive Officer of the Company and
SS&C, with the duties and responsibilities customarily assigned to those positions consistent with
past practice and such other duties and responsibilities as the Board shall from time to time
reasonably assign to the Executive consistent with Executive’s position. The Executive shall at
all times report directly to the Board. In addition, Executive shall serve as the Chairman of the
Board of Directors of SS&C and any direct or indirect parent or holding company, the assets of
which are the stock of SS&C.
(b) Duties. During the Term, the Executive shall devote Executive’s full business
attention and time to the business of the Company and SS&C and shall use Executive’s reasonable
best efforts to carry out such responsibilities faithfully and efficiently. During the Term, it
shall not be considered a violation of the foregoing for the Executive to serve on corporate, civic
or charitable boards or committees, and manage personal investments, so long as such activities do
not materially interfere with the performance of the Executive’s responsibilities as an employee of
the Company and SS&C and do not violate the restrictions contained in Section 7.
(c) Location. The Executive’s services shall be performed primarily at SS&C’s offices in
Windsor, Connecticut.
3. Compensation.
(a) Base Salary. During the Term, the Executive shall receive a base salary (the “Base
Salary”) at an annual rate of not less than seven hundred fifty thousand dollars ($750,000) payable
at such times as SS&C customarily pays the base salaries of other senior executives of SS&C
(hereinafter, “Other Senior Executives”). The Base Salary shall be reviewed annually for increase
in accordance with SS&C’s normal practices for Other Senior Executives. The Base Salary shall not
be reduced, including, after any increase, and the term “Base Salary” shall thereafter refer to the
Base Salary as so increased.
(b) Annual Bonus. During the Term, the Executive shall be eligible to earn a discretionary
annual bonus (the “Annual Bonus”) based on individual performance as well as the Company’s
strategic, operational, and financial performance during the year, as determined by the
Compensation Committee of the Board of Directors. Subject to Executive remaining employed by the
Company through December 31st of the applicable calendar year, Executive will receive a
minimum Annual Bonus of $500,000.
(c) Long Term Incentive Compensation.
(i) During the Term and subject to the terms of this Agreement, Executive shall be eligible to
receive annual awards under any long term incentive program or similar plan, program or arrangement
of the Company, which may include options to purchase shares of common stock of the Company
(“Options”) or restricted shares of common stock of the Company, including the Class A Restricted
Stock referenced in Section 3(c)(ii) below (“Restricted Shares”).
(ii) Notwithstanding the generality of the foregoing clause (i), on or at the first Board
meeting after the Effective Date, Executive shall be granted 153,846 shares of Class A Restricted
Stock (which number of shares shall be subject to equitable adjustment to reflect stock splits,
reverse stock splits, stock dividends and other capital adjustments between the Effective Date and
the date of grant). Subject to Section 5 hereof, the Restricted Stock shall vest over a period of
three years from the Effective Date with 1/3 of the shares of Restricted Stock vesting on the first
anniversary of the Effective Date and the remaining 2/3 of the shares of Restricted Stock vesting
in eight equal quarterly installments over the remaining two years.
(iii) All Options granted to Executive shall (A) have a per share exercise price that is no
greater than fair market value of a share of common stock of the Company on the date of grant; (B)
have a maximum term of ten years from the date of grant; and (C) otherwise be subject to the terms
of this Agreement.
4. Other Benefits.
(a) Benefits. During the Term, the Executive shall be entitled to participate in the
benefits, incentive and compensation plans, programs and arrangements of SS&C (“Employee Benefit
Plans”), on terms and conditions no less favorable than those applicable to
-2-
any Other Senior
Executive. Without limiting the generality of the foregoing, Executive shall be entitled to no less
than six (6) weeks of paid vacation per calendar year.
(b) Perquisites. The Board may from time to time approve the granting of additional
benefits to Executive including, but not limited to, life and/or disability insurance, car
allowance or Company car, or membership in health, business or social and/or other clubs,
associations or organizations. Such perquisites shall be no less favorable in any material respect
than such perquisites provided to the Executive by SS&C prior to the Merger.
(c) Expenses. During the Term, the Executive shall be entitled to receive prompt
reimbursement for all reasonable expenses that Executive incurs during the Term in carrying
out Executive’s duties under this Agreement.
(d) Key Person Insurance. The Company and SS&C shall have the right to insure the life of
the Executive for the Company’s and/or SS&C’s sole benefit. The Company and SS&C shall have the
right to determine the amount of insurance and the type of policy. The Executive shall cooperate
with the Company and SS&C in obtaining such insurance by submitting to reasonably required physical
examinations, by supplying all information reasonably required by any insurance carrier, and by
executing all necessary documents reasonably required by any insurance carrier. The Executive shall
incur no financial obligation by executing any required document, and shall have no interest in any
such policy.
(e) Indemnity. The Company and SS&C agree that if the Executive is made a party, or is
threatened to be made a party, to any action, suit or proceeding, whether civil, criminal,
administrative or investigative (a “Proceeding”), by reason of the fact that Executive is or was a
director, officer or employee of the Company or SS&C or is or was serving at the request of the
Company or SS&C as a director, officer, member, employee or agent of another corporation,
partnership, joint venture, trust, limited liability company or other enterprise, including service
with respect to employee benefit plans, whether or not the basis of such Proceeding is the
Executive’s alleged action in an official capacity while serving as a director, officer, member,
employee or agent, the Executive shall be indemnified and held harmless by the Company and SS&C to
the fullest extent legally permitted or authorized by the Company’s and SS&C’s certificates of
incorporation or bylaws or resolutions of the Board or, if greater, by the laws of the State of
Delaware, against all cost, expense, liability and loss (including, without limitation, attorney’s
fees, judgments, fines, ERISA excise taxes or other liabilities or penalties and amounts paid or to
be paid in settlement) reasonably incurred or suffered by the Executive in connection therewith,
and such indemnification shall continue as to the Executive even if Executive has ceased to be a
director, member, employee or agent of the Company, SS&C or other entity and shall inure to the
benefit of the Executive’s heirs, executors and administrators. To the extent permitted by
applicable law, the Company and SS&C shall advance to the Executive all reasonable costs and
expenses incurred by Executive in connection with a Proceeding within twenty (20) calendar days
after receipt by the Company of a written request for such advance. Such request shall include an
undertaking by the Executive to repay the amount of such advance if it shall ultimately be
determined that Executive is not entitled to be indemnified against such costs and expense. Neither
the failure of the Company nor SS&C (including their boards of directors, independent legal counsel
or stockholders) to have made a determination prior to the commencement of any proceeding
concerning payment of amounts
-3-
claimed by the Executive that indemnification of the Executive is
proper because Executive has met the applicable standard of conduct, nor a determination by the
Company or SS&C (including its board of directors, independent legal counsel or stockholders) that
the Executive has not met such applicable standard of conduct, shall create a presumption that the Executive has not met the
applicable standard of conduct. The Company and SS&C agree to continue and maintain a directors’
and officers’ liability insurance policy covering the Executive to the extent the Company and SS&C
provide such coverage for their other executive officers. Such insurance coverage shall be
maintained for at least six (6) years following any Change in Control.
5. Payments to Executive at Termination.
(a) Consequences of Termination. If the Executive’s employment with the Company and SS&C
is terminated for any reason, the Executive (or, in the case of Executive’s death, the Executive’s
estate and/or beneficiaries) shall be entitled to the following: (i) unpaid Base Salary through the
date of the termination; (ii) payment of any Annual Bonus earned with respect to a completed fiscal
year of the Company that is unpaid as of the date of termination; and (iii) any benefits due to
Executive under any Employee Benefit Plan and any payments due to the Executive under any Company
or SS&C policy, program, arrangement or agreement (including, without limitation, reimbursement for
previously incurred expenses) (collectively, the “Accrued Amounts”).
(b) Termination Without Cause; for Good Reason; Nonrenewal by the Company. The Company may
terminate Executive’s employment without Cause and Executive may terminate his employment for Good
Reason (notwithstanding anything in this Agreement to the contrary, “Good Reason” shall not exist
unless the provisions of Section 5(f) are complied with), in each case upon thirty 30 days written
notice, and the Executive’s employment may be terminated upon a Notice of Nonrenewal by the
Company. Upon a termination of the Executive’s employment by the Company without Cause, as a result
of the Company’s Notice of Nonrenewal, or by the Executive for Good Reason, the Executive shall be
entitled to, provided that Executive has executed and submitted a Release and the statutory period
during which Executive is entitled to revoke the Release has expired on or before the sixtieth day
following the date of termination, the following:
(i) severance payments totaling the sum of 200% of the Executive’s Base Salary and 200% of
Executive’s minimum Annual Bonus, payable on the sixtieth day following termination; provided that
if Executive’s termination is for Good Reason due to a reduction in any such amount, the amount
used in calculating the severance payment shall be that in effect prior to the event giving rise to
Good Reason;
(ii) the Executive’s outstanding Options, whether or not then exercisable, shall become
exercisable with respect to 50% of the unvested shares subject to the Options, as determined on the
date of termination, and shall remain exercisable for the balance of their ten-year terms as if no
termination had occurred (subject to earlier termination as provided in the applicable plan, for
example, in connection with a Change in Control);
(iii) all vesting restrictions on Restricted Shares shall lapse;
-4-
(iv) three years of Company paid premiums for Executive’s continuation of coverage under the
Company’s group medical, dental and vision benefit plans and, to the extent permitted under the terms of the Company’s group medical, dental and vision
benefit plans, continued coverage, at the Executive’s cost, for the remainder of Executive’s life.
(c) Termination Due to Death or Disability. The Company shall have the right to terminate
Executive’s employment as a result of Executive’s Disability (as defined below) upon thirty 30 days
written notice and Executive’s employment shall automatically terminate upon the death of the
Executive. In the event that Executive’s employment is terminated during the Term due to
Executive’s Disability or death, Executive (or in the event of Executive’s death, his estate) shall
be entitled to, provided that, in the case of Disability, Executive has executed and submitted a
Release and the statutory period during which Executive is entitled to revoke the Release has
expired on or before the sixtieth day following the date of termination, the following benefit and
shall not be entitled to payments or benefits under Section 5(b): (i) disability or death benefits
(as applicable) in accordance with the Company or SS&C provided insurance programs and arrangements
in which Executive was participating immediately prior to such termination; (ii) 50% of the
unvested shares subject to the Executive’s outstanding Options, whether or not then exercisable,
shall become exercisable and shall remain exercisable for the balance of their ten-year terms as if
no termination had occurred (subject to earlier termination as provided in the applicable plan, for
example, in connection with a Change in Control); (iii) all vesting restrictions on Restricted
Shares shall lapse; (iv) a cash payment equal to the amount of the Executive’s most recent Annual
Bonus pro-rated to reflect the portion of the fiscal year that occurs before the date of
termination, payable on the sixtieth day following the date of termination.
(d) Voluntary Resignation. Executive may terminate his employment at any time without Good
Reason upon ninety 90 days written notice to the Company. In the event that the Executive resigns
without Good Reason, which shall include a termination upon a Notice of Nonrenewal by Executive (a
“Voluntary Resignation”), Executive shall only be entitled to the Accrued Amounts, and Options and
any other equity-based awards that are vested as of the effective date of termination shall
continue according to the terms of such awards applicable to such a termination.
(e) Termination for Cause. (i) The Company may terminate Executive’s employment for Cause
in compliance with the requirements of this Section 5(e), and notwithstanding anything in this
Agreement to the contrary, “Cause” shall not exist unless the provisions of this Section 5(e) are
complied with. In the event that the Company terminates the Executive’s employment for Cause, then
the Executive shall only be entitled to the Accrued Amounts, and Options and any other equity-based
awards that are vested as of the effective date of termination shall continue according to the
terms of such awards applicable to a termination for Cause.
(ii) The Executive shall be given written notice by the Company of the intention to terminate
Executive for Cause, such notice (A) to state in detail the particular act or acts or failure or
failures to act that constitute the grounds on which the proposed termination for Cause is based
and (B) to be given within the three (3) month period immediately following the date the members of
the Board, other than the Executive, learn of such act or acts or failure or
-5-
failures to act. The
Executive shall have ten (10) business days after the date that such written notice has been given
to the Executive in which to cure such conduct, to the extent such cure is possible. If the Executive fails to cure such conduct, the Executive shall then be entitled to
a hearing before a meeting of the Board. Such hearing shall be held within fifteen (15) business
days after such cure period, provided Executive requests such hearing within ten (10) business days
of the written notice from the Company of the intention to terminate Executive for Cause. If,
within five (5) business days following such hearing, the Executive is furnished written notice by
the Company confirming that, in its judgment, grounds for Cause on the basis of the original notice
exist, Executive shall thereupon be terminated for Cause. Any purported termination for Cause that
fails to comply with the foregoing requirements shall be conclusively deemed to be a termination by
the Company without Cause. The Company may suspend Executive during the pendency of the foregoing
process; provided that Executive shall continue to receive all compensation and benefits during
such suspension; provided, further that such suspension may not be effected if it prevents or
hinders Executive’s ability to cure Executive’s conduct.
(f) Termination for Good Reason. (i) The Executive may terminate Executive’s employment
for Good Reason in compliance with the requirements of this Section 5(f), and notwithstanding
anything in this Agreement to the contrary, “Good Reason” shall not exist unless the provisions of
this Section 5(f) are complied with. In the event that the Executive terminates his employment for
Good Reason, then the Executive shall be entitled to the amounts set forth in Section 5(b).
(ii) The Company shall be given written notice by the Executive of his intention to terminate
for Good Reason, such notice (A) to state in detail the particular act or acts or failure or
failures to act that constitute the grounds on which the proposed termination for Good Reason is
based and (B) to be given within the three (3) months period immediately following the date the
Executive learns of such act or acts or failure or failures to act. The Company shall have ten (10)
business days after the date that such written notice has been given to the Company in which to
cure such conduct, to the extent such cure is possible. If the Company fails to cure such conduct,
the Executive shall, within five (5) business days following such failure to cure, furnish to the
Company written notice confirming that, in his judgment, grounds for Good Reason on the basis of
the original notice exist, and the Executive may thereupon terminate for Good Reason, subject to
the 30 day notice period in Section 5(b). Any purported termination for Good Reason that fails to
comply with the foregoing requirements shall be conclusively deemed to be a termination by the
Executive without Good Reason. The Company may suspend the Executive during the pendency of the
foregoing process; provided that Executive shall continue to receive all compensation and benefits
during such suspension.
(g) Definitions. For purposes of this Agreement, the following definitions shall apply:
(i) “Cause” shall mean: (i) Executive’s willful and continuing failure (except where due to
physical or mental incapacity) to substantially perform his duties; Executive’s conviction of, or
plea of guilty or nolo contendere to, the commission of a felony by Executive; the commission by
Executive of an act of fraud or embezzlement against the Company or any of its subsidiaries (other
than a good faith expense dispute) as determined in
-6-
good faith by a two-thirds majority of the
Board at a meeting held for such purpose; or Executive’s breach of any material provision of this
Agreement.
(ii) “Change in Control” shall mean (A) the acquisition by any individual, entity or group
(within the meaning of Section 13(d)(3) or 14(d)(2) of the Securities Exchange Act of 1934, as
amended (the “Exchange Act”)) (a “Person”) of beneficial ownership (within the meaning of Rule
13d-3 promulgated under the Exchange Act) of 50% or more of either (1) the then-outstanding shares
of common stock of the Company or SS&C or (2) the combined voting power of the then-outstanding
voting securities of the Company or SS&C entitled to vote generally in the election of directors
(the “Outstanding Company Voting Securities”); provided, however, that, for purposes of this
Section 5(g)(ii), the following acquisitions shall not constitute a Change in Control: (x) any
acquisition by the Company, Carlyle Partners IV, L.P. (“Carlyle”), Executive, any employee of the
Company or any of its subsidiaries, any group of employees of the Company or any of its
subsidiaries, or an affiliate of the Company, Carlyle, Executive, any employee of the Company or
any group comprised of any of the foregoing, or (y) any acquisition by any employee benefit plan
(or related trust) sponsored or maintained by the Company or an affiliate of the Company; or (B)
individuals who, as of the date immediately following the Effective Date, constituted the Board and
any individuals subsequently elected to the Board pursuant to or in accordance with Section 7 of
the Stockholders Agreement (the “Incumbent Board”) cease for any reason to constitute at least a
majority of the Board; provided, however, that any individual becoming a director subsequent to the
Effective Date whose election, or nomination for election by the Company’s stockholders, was
approved by a vote of at least a majority of the directors then comprising the Incumbent Board
shall be considered as though such individual were a member of the Incumbent Board and any
individual nominated or designated for election to the Board by Carlyle or any of its affiliates
shall be considered as though such individual were a member of the Incumbent Board.
(iii) “Disability” shall mean physical or metal incapacity as a result of which Executive is
unable to substantially perform his duties to the Company and SS&C for a period of six consecutive
months and as a result of which Executive is entitled to long term disability benefits under the
Company’s or SS&C’s long term disability plan applicable to Executive and Other Senior Executives.
(iv) “Good Reason” shall mean the occurrence without Executive’s express written consent of
(i) an adverse change in Executive’s employment title; (ii) a material diminution in Executive’s
employment duties or responsibilities or authority, or the assignment to Executive of duties that
are materially inconsistent with his position; (iii) any reduction in Base Salary or minimum Annual
Bonus; (iv) a relocation of the Company’s principal executive offices to a location more than
thirty five (35) miles from its current location which has the effect of increasing the Executive’s
commute; (v) any breach by the Company of any material provision of this Agreement or the
Stockholders Agreement entered into by and among the Company, Xxxxxxx, XX XX Coinvestment, L.P. and
the Executive, as may be amended from time to time (the “Stockholders Agreement”) or (vii) upon a
Change in Control where (A) Carlyle exercises its bring-along rights in accordance with Section 2
of the Stockholders Agreement, and (B) the Executive votes against the proposed transaction in his
capacity as a stockholder of the Company.
-7-
(v) “Release” means a written release, in form and substance reasonably satisfactory to the
Company and the Executive, whereby Executive waives and releases the Company and its affiliates and
related parties from any and all claims that Executive may have against the Company and its affiliates relating to Executive’s employment or the
termination thereof and whereby the Company agrees to waive and release Executive from any and all
claims that the Company may have against Executive relating to Executive’s employment or
termination thereof (except for fraud, misappropriation of the Company’s or its affiliate’s assets
or any other alleged criminal wrongdoing or malfeasance of a gross nature).
6. Confidentiality of Trade Secrets and Business Information.
(a) Except in connection with the faithful performance of the Executive’s duties hereunder or
pursuant to Section 6(c), the Executive shall, in perpetuity, maintain in confidence and shall not
directly, indirectly or otherwise, use, disseminate, disclose or publish, or use for his benefit or
the benefit of any person, firm, corporation or other entity any confidential or proprietary
information or trade secrets of or relating to the Company (including, without limitation,
intellectual property in the form of patents, trademarks and copyrights and applications therefor,
ideas, inventions, works, discoveries, improvements, information, documents, formulae, practices,
processes, methods, developments, source code, modifications, technology, techniques, data,
programs, other know-how or materials, owned, developed or possessed by the Company, whether in
tangible or intangible form, information with respect to the Company’s operations, processes,
products, inventions, business practices, finances, principals, vendors, suppliers, customers,
potential customers, marketing methods, costs, prices, contractual relationships, regulatory
status, prospects and compensation paid to employees or other terms of employment), or deliver to
any person, firm, corporation or other entity any document, record, notebook, computer program or
similar repository of or containing any such confidential or proprietary information or trade
secrets. The parties hereby stipulate and agree that as between them the foregoing matters are
important, material and confidential proprietary information and trade secrets and affect the
successful conduct of the businesses of the Company (and any successor or assignee of the Company).
(b) Upon termination of the Executive’s employment with the Company for any reason, the
Executive will promptly deliver to the Company all correspondence, drawings, manuals, letters,
notes, notebooks, reports, programs, plans, proposals, financial documents, or any other documents
concerning the Company’s customers, business plans, marketing strategies, products or processes.
(c) The Executive may respond to a lawful and valid subpoena or other legal process but shall
give the Company prompt notice thereof, shall promptly make available to the Company and its
counsel the documents and other information sought and shall assist, if appropriate, such counsel
at Company’s expense in resisting or otherwise responding to such process.
(d) As used in this Section 6, the term “Company” shall include the Company and its direct or
indirect parents, if any, and subsidiaries.
-8-
(e) Nothing in this Agreement shall prohibit the Executive from (i) disclosing information and
documents when required by law, subpoena or court order (subject to the requirements of Section
6(c) above), (ii) disclosing information and documents to his attorney or tax adviser for the
purpose of securing legal or tax advice, (iii) disclosing the post-employment restrictions in this Agreement in confidence to any potential new employer, or (iv)
retaining, at any time, his personal correspondence, his personal rolodex and documents related to
his own personal benefits, entitlements and obligations.
(f) All rights to discoveries, inventions, improvements and innovations (including all data
and records pertaining thereto) related to the business of the Company, whether or not patentable,
copyrightable, registrable as a trademark, or reduced to writing, that the Executive may discover,
invent or originate during the Term, either alone or with others and whether or not during working
hours or by the use of the facilities of the Company (“Inventions”), shall be the exclusive
property of the Company. The Executive shall promptly disclose all Inventions to the Company, shall
execute at the request of the Company any assignments or other documents the Company may deem
reasonably necessary to protect or perfect its rights therein, and shall assist the Company, upon
reasonable request and at the Company’s expense, in obtaining, defending and enforcing the
Company’s rights therein. The Executive hereby appoints the Company as his attorney-in-fact to
execute on his behalf any assignments or other documents reasonably deemed necessary by the Company
to protect or perfect its rights to any Inventions.
7. Noncompetition.
(a) In consideration for the compensation payable to the Executive under this Agreement, the
Executive agrees that Executive will not, during the Non-Compete Period, directly or indirectly
engage in, have any equity interest in, manage or operate, provide services for, consult with or be
employed by any person, firm, corporation, partnership or business (whether as director, officer,
employee, agent, representative, partner, security holder, consultant or otherwise) that engages in
any business which competes with any Competitive Business (as defined below) anywhere in the World;
provided, however, that the Executive shall be permitted to acquire a passive stock interest in
such a business provided the stock acquired is publicly traded and is not more than two percent
(2%) of the outstanding interest in such business. For purposes of this Section 7, the “Non-Compete
Period” shall mean the period beginning on the Effective Date and ending (i) if Executive is
terminated by the Company pursuant to Sections 5(c) or 5(e) or by Executive pursuant to Section
5(d), on the later of (A) four (4) years following the Effective Date, and (B) two (2) years
following the Executive’s termination of employment, and (ii) if Executive is terminated pursuant
to Section 5(b), two (2) years following the Executive’s termination of employment.
(b) During the Non-Compete Period, the Executive shall not recruit or otherwise solicit or
induce any employee, consultant, independent contractor, customer, subscriber or supplier of the
Company (i) to terminate its employment or arrangement with the Company, or (ii) to otherwise
change its relationship with the Company.
(c) In the event the terms of this Section 7 shall be determined by any court of competent
jurisdiction to be unenforceable by reason of its extending for too great a period of
-9-
time or over
too great a geographical area or by reason of its being too extensive in any other respect, it will
be interpreted to extend only over the maximum period of time for which it may be enforceable, over
the maximum geographical area as to which it may be enforceable, or to the maximum extent in all other respects as to which it may be enforceable, all as
determined by such court in such action.
(d) As used in this Section 7, (i) the term “Company” shall include the Company and its parent
and subsidiaries, and (ii) the term “Competitive Business” shall mean any business that competes
with the business conducted by the Company as of the date of the Executive’s termination of
employment with the Company.
(e) During his employment and for the 12-month period following termination of his employment
with the Company, (a) the Executive agrees not to disparage in any material respect the Company,
any of its products or practices, or any of its directors, officers, agents, representatives,
stockholders or affiliates, either orally or in writing, and (b) the Company agrees not to
disparage in any material respect the Executive.
8. Enforcement. The Executive acknowledges and agrees that: (i) the purpose of the
covenants set forth in Sections 6 and 7 above are to protect the goodwill, trade secrets and other
confidential information of the Company; (ii) because of the nature of the business in which the
Company is engaged and because of the nature of the Confidential Information to which the Executive
has access, it would be impractical and excessively difficult to determine the actual damages of
the Company in the event the Executive breached any such covenants; and (iii) remedies at law (such
as monetary damages) for any breach of the Executive’s obligations under Sections 6 and 7 would be
inadequate. The Executive therefore agrees and consents that if Executive commits any breach of a
covenant under Sections 6 or 7, the Company shall have the right (in addition to, and not in lieu
of, any other right or remedy that may be available to it) to temporary and permanent injunctive
relief from a court of competent jurisdiction.
9. Resolution of Disputes; Legal Fees. Any disputes arising under or in connection with
this Agreement, other than Sections 6 and 7 above, shall first be addressed by third-party
mediation and, if such mediation fails to resolve such dispute within sixty days, by binding
arbitration, to be held in Hartford county, Connecticut. The arbitration shall be conducted
according to the rules and procedures of the American Arbitration Association governing employment
disputes. Judgment upon the award rendered by the arbitrator(s) may be entered in any court having
jurisdiction thereof. The Company shall pay the costs of the arbitrator or the mediator.
10. Certain Additional Payments. In the event that the severance and other benefits
provided for in this Agreement or otherwise payable to the Executive in connection with a Change in
Control that occurs following the Effective Date constitute “parachute payments” within the meaning
of Section 280G of the Internal Revenue Code of 1986, as amended (the “Code”) and will be subject
to the excise tax imposed by Section 4999 of the Code, then the Executive shall receive (a) a
payment from the Company sufficient to pay such excise tax, and (b) an additional payment from the
Company sufficient to pay the excise tax and federal and state income taxes arising from the
payments made by the Company to the Executive pursuant to
-10-
this sentence. Unless the Company and the
Executive otherwise agree in writing, the determination of the Executive’s excise tax liability and
the amount required to be paid under this Section shall be made in writing by an independent
account firm selected by the Company and the Executive (the “Accountants”). In the event that the excise tax incurred by Executive is
determined by the Internal Revenue Service to be greater or lesser than the amount so determined by
the Accountants, the Company and Executive agree to promptly make such additional payment,
including interest and any tax penalties, to the other party as the Accountants reasonably
determine is appropriate to ensure that the net economic effect to the Executive under this
Section, on an after-tax basis, is as if the Code Section 4999 excise tax did not apply to
Executive. For purposes of making the calculations required by this Section, the Accountants may
make reasonable assumptions and approximations concerning applicable taxes and may rely on
interpretations of the Code for which there is a “substantial authority” tax reporting position.
The Company and the Executive shall furnish to the Accountants such information and documents as
the Accountants may reasonably request in order to make a determination under this Section. The
Company shall bear all costs the Accountants may reasonably incur in connection with any
calculations contemplated by this Section.
11. Section 409A.
(a) This Agreement is intended to satisfy the requirements of Section 409A of the Code
(“Section 409A”) with respect to amounts, if any, subject thereto and shall be interpreted and
construed and shall be performed by the parties consistent with such intent. If the Company or
Executive notifies the other in writing that one or more or the provisions of this Agreement
contravenes any Treasury Regulations or guidance promulgated under Section 409A or causes any
amounts to be subject to interest, additional tax or penalties under Section 409A, the parties
shall promptly and reasonably consult with each other, and shall use their commercially reasonable
efforts to reform the provisions of this Agreement to (a) maintain to the maximum extent reasonably
practicable the original intent of the applicable provisions without violating the provisions of
Section 409A and (b) to the maximum extent possible, to avoid the imposition of any interest,
additional tax or other penalties under Section 409A upon Executive. In no event shall the Company
be required to provide a tax gross-up payment to Executive for any Section 409A penalties or
interest as a result of this Section 11(a).
(b) To the extent Executive would otherwise be entitled to any payment under this Agreement
that constitutes a “deferral of compensation” subject to Section 409A and that if paid during the
six (6) months beginning on the date of termination of Executive’s employment would be subject to
the Section 409A additional tax because Executive is a “specified employee” (within the meaning of
Section 409A and as determined by the Company), the payment will be paid to Executive on the
earlier of the six (6) month anniversary of Executive’s date of termination or death. Similarly, to
the extent Executive would otherwise be entitled to any benefit (other than a payment) during the
six (6) months beginning on termination of his employment that would be subject to the Section 409A
additional tax, the benefit will be delayed and will begin being provided on the earlier of the
first day following the six (6) month anniversary of his date of termination or death.
(c) Any payment or benefit due upon a termination of Executive’s employment that represents a
“deferral of compensation” within the meaning of Xxxxxxx 000X
-00-
xxxxx xx paid or provided to
Executive only upon a “separation from service” as defined in Treas. Reg. § 1.409A-1(h). Each
payment made under this Agreement shall be deemed to be a separate payment for purposes of Section
409A. Amounts payable under this Agreement shall be deemed
not to be a “deferral of compensation” subject to Section 409A to the extent provided in the
exceptions in Treasury Regulation §§ 1.409A-1(b)(4) (“short-term deferrals”) and (b)(9)
(“separation pay plans,” including the exception under subparagraph (iii)) and other applicable
provisions of Treasury Regulation § 1.409A-1 through A-6.
(d) Notwithstanding anything to the contrary in this Agreement or elsewhere, any payment or
benefit under this Agreement or otherwise that is exempt from Section 409A pursuant to Treasury
Regulation § 1.409A-1(b)(9)(v)(A) or (C) (relating to certain reimbursements and in-kind benefits)
shall be paid or provided to Executive only to the extent that the expenses are not incurred, or
the benefits are not provided, beyond the last day of the second calendar year following the
calendar year in which Executive’s “separation from service” occurs; and provided further that such
expenses are reimbursed no later than the last day of the third calendar year following the
calendar year in which Executive’s “separation from service” occurs. To the extent any expense
reimbursement or the provision of any in-kind benefit is determined to be subject to Section 409A
(and not exempt pursuant to the prior sentence or otherwise), the amount of any such expenses
eligible for reimbursement, or the provision of any in-kind benefit, in one calendar year shall not
affect the expenses eligible for reimbursement in any other calendar year (except for any life-time
or other aggregate limitation applicable to medical expenses), in no event shall any expenses be
reimbursed after the last day of the calendar year following the calendar year in which the
Executive incurred such expenses, and in no event shall any right to reimbursement or the provision
of any in-kind benefit be subject to liquidation or exchange for another benefit. Without limiting
the foregoing, any payments to Executive pursuant to Section 10 above shall in all events be paid
to Executive no later than the end of his taxable year next following the taxable year in which the
excise taxes imposed by Section 4999 of the Code and any other federal and state income taxes
arising from the payments to Executive pursuant to Section 10 are remitted to the Internal Revenue
Service or any other applicable taxing authority. The Company’s reimbursement obligations under
this Section 11(d) are subject to Executive submitting to the Company the applicable expense
reimbursement request no later than thirty (30) days prior to the last day such expense can be
reimbursed without creating an additional tax under Section 409A.
12. The Executive’s Representations. The Executive hereby represents and warrants that the
Executive has the right to enter into this Agreement with the Company and to grant the rights
contained in this Agreement, and the provisions of this Agreement do not violate any other
contracts or agreements that the Executive has entered into with any other individual or entity.
The Executive acknowledges that before signing this Agreement, Executive was given the opportunity
to read it, evaluate it and discuss it with Executive’s personal advisors and attorney and with
representatives of the Company. The Executive further acknowledges that the Company has not
provided the Executive with any legal advice regarding this Agreement.
13. Notices. All notices and other communications required or permitted hereunder shall be
in writing and shall be deemed given when delivered (a) personally, (b) by facsimile with evidence
of completed transmission, or (c) delivered by overnight courier to the
-12-
party concerned at the
address indicated below or to such changed address as such party may subsequently give such notice
of:
If to the Company:
SS&C Technologies Holdings, Inc.
c/o The Carlyle Group
000 Xxxxx Xxxxx Xxxxxx
Xxxxx 0000
Xxxxxxxxx, XX 00000
Attention: Xxxxxxxx X. Xxxxx XX
Fax: (000) 000-0000
c/o The Carlyle Group
000 Xxxxx Xxxxx Xxxxxx
Xxxxx 0000
Xxxxxxxxx, XX 00000
Attention: Xxxxxxxx X. Xxxxx XX
Fax: (000) 000-0000
If to SS&C:
SS&C Technologies, Inc.
c/o The Carlyle Group
000 Xxxxx Xxxxx Xxxxxx
Xxxxx 0000
Xxxxxxxxx, XX 00000
Attention: Xxxxxxxx X. Xxxxx XX
Fax: (000) 000-0000
c/o The Carlyle Group
000 Xxxxx Xxxxx Xxxxxx
Xxxxx 0000
Xxxxxxxxx, XX 00000
Attention: Xxxxxxxx X. Xxxxx XX
Fax: (000) 000-0000
If to the Executive:
Xxxxxxx X. Xxxxx
00 Xxxx Xxxxx Xx.
Xxxx, XX 00000
Fax: (000) 000-0000
00 Xxxx Xxxxx Xx.
Xxxx, XX 00000
Fax: (000) 000-0000
14. Assignment and Successors. This Agreement shall inure to the benefit of and be binding
upon the Company and SS&C and their successors and assigns. None of the Executive’s rights or
obligations may be assigned or transferred by the Executive, other than the Executive’s rights to
payments hereunder, which may be transferred only by will or operation of law.
15. Governing Law; Amendment. This Agreement shall be governed by, and construed in
accordance with, the laws of the State of Connecticut, without reference to principles of conflict
of laws. This Agreement may not be amended or modified except by a written agreement executed by
the Executive and the Company or their respective successors and legal representatives.
16. Severability. The invalidity or unenforceability of any provision of this Agreement
shall not affect the validity or enforceability of any other provision of this Agreement. If any
provision of this Agreement shall be held invalid or unenforceable in part, the
-13-
remaining portion
of such provision, together with all other provisions of this Agreement, shall remain valid and
enforceable and continue in full force and effect to the fullest extent consistent with law.
17. Tax Withholding. Notwithstanding any other provision of this Agreement, the Company or
SS&C may withhold from amounts payable under this Agreement all federal, state, local and foreign taxes that are required to be withheld by applicable laws or
regulations.
18. Costs Associated with Agreement. The Company shall reimburse the Executive for the
costs incurred by the Executive for financial counseling and attorneys’ fees associated with
negotiation and preparation of this Agreement, the Stockholders Agreement and other related
documents.
19. No Waiver. The Executive’s or the Company’s failure to insist upon strict compliance
with any provision of, or to assert any right under, this Agreement shall not be deemed to be a
waiver of such provision or right or of any other provision of or right under this Agreement.
20. No Mitigation/Offset. The Executive shall not be obligated to mitigate the amount of
any payments due under this Agreement and no payments or benefits under this Agreement shall be
subject to reduction, offset or forfeiture for any reason.
21. Headings. The section headings contained in this Agreement are for convenience only
and in no manner shall be construed as part of this Agreement.
22. Entire Agreement. This Agreement constitutes the entire agreement of the parties with
respect to the subject matter hereof and shall supersede all prior agreements (including, without
limitation, the employment agreement between SS&C and the Executive, dated March 28, 1996), whether
written or oral, with respect thereto.
23. Duration of Terms. The respective rights and obligations of the parties hereunder
shall survive any termination of Executive’s employment, the Term or this Agreement to the extent
necessary to give effect to such rights and obligations.
24. Counterparts. This Agreement may be executed simultaneously in two or more
counterparts, each of which shall be deemed an original but all of which together shall constitute
one and the same instrument.
-14-
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed, all as of
the day and year first above written.
| SS&C TECHNOLOGIES HOLDINGS, INC. |
||||
| By: | /s/ Xxxxxxx X. Xxxxxxxxx | |||
| Its: | President and COO | |||
| SS&C TECHNOLOGIES, INC. |
||||
| By: | /s/ Xxxxxxx X. Xxxxxxxxx | |||
| Its: | President and COO | |||
| XXXXXXX X. XXXXX | ||||
| /s/ Xxxxxxx X. Xxxxx | ||||
-15-
