RESTRICTED STOCK AGREEMENT PURSUANT TO THE MARKETAXESS HOLDINGS INC. 2004 STOCK INCENTIVE PLAN
Exhibit 10.1
THIS AGREEMENT, made as of the 31st day of January 2006, by and between MarketAxess Holdings
Inc., a Delaware corporation with its principal office at 000 Xxxxxxxx, 00xx Xxxxx, Xxx
Xxxx, Xxx Xxxx 00000 (the “Company”), and Xxxxxxx X. XxXxx
residing at
(the “Participant”).
WHEREAS, the Board of Directors of the Company (the “Board”) adopted, and the stockholders of
the Company, approved the MarketAxess Holdings Inc. 2004 Stock Incentive Plan (the “Plan”);
WHEREAS, the Company, through the Committee under the Plan, wishes to grant to the Participant
shares of its common stock, par value $.003 per share (“Common Stock” or the “Shares”) in the
amount set forth below; and
WHEREAS, such Shares are subject to certain restrictions.
NOW, THEREFORE, the Company and the Participant agree as follows:
1. Sale of Shares. Subject to the terms, conditions and restrictions of the Plan and
this Agreement, the Company awards to the Participant Four Hundred Five Thousand (405,000) shares
of the Company’s Common Stock on January 31, 2006 (the “Grant Date”). To the extent required by
law, the Participant shall pay the Company the par value ($.003) (the “Purchase Price”) for each
Share awarded to the Participant simultaneously with the execution of this Agreement in cash or
cash equivalents payable to the order of the Company. Pursuant to the Plan and Section 2 of this
Agreement, the Shares are subject to certain restrictions, which restrictions shall expire in
accordance with the provisions of the Plan and Section 2 hereof. While such restrictions are in
effect, the Shares subject to such restrictions shall be referred to herein as “Restricted Stock.”
2. Vesting.
(a) Except as set forth in subsections (b), (c) and (d) below, the Restricted Stock shall
become vested and cease to be Restricted Stock (but shall remain subject to the other terms of this
Agreement and the Plan) as follows if the Participant has been continuously employed by the Company
until such date:
| Vesting Date | Percentage Vested | |||
February 1, 2007 |
20% | |||
February 1, 2008 |
20% | |||
February 1, 2009 |
20% | |||
February 1, 2010 |
20% | |||
February 1, 2011 |
20% | |||
Notwithstanding the foregoing, the Restricted Stock shall become vested and cease to be
Restricted Stock (but shall remain subject to the other terms of this Agreement and the Plan) upon
the attainment of the performance goals described on Exhibit A, attached hereto, as determined by
the Committee in its sole discretion as follows:
| Attainment of Performance Goal | Vesting Dates | Percentage Vested | ||||||
Attainment of 2006 Revenue and EPS Goals |
February 1, 2007 | 34% | ||||||
| February 1, 2008 | 33% | |||||||
| February 1, 2009 | 33% | |||||||
The Committee may, in its sole discretion, make adjustments to any performance goals as a
result of acquisitions and new business ventures that were not initially considered when developing
the original goals or to reflect other extraordinary events.
There shall be no proportionate or partial vesting in the periods prior to the applicable
vesting dates and all vesting shall occur only on the appropriate vesting date.
(b) Upon the death or Disability of the Participant, all of the Restricted Stock shall become
vested and cease to be Restricted Stock (but shall remain subject to the other terms of this
Agreement and the Plan).
(c) In the event the Participant incurs a Termination by the Company without Cause (as defined
below), the lesser of (i) 67,500 shares of the Restricted Stock or (ii) all of the remaining
unvested shares of Restricted Stock shall become vested and cease to be Restricted Stock (but shall
remain subject to the other terms of this Agreement and the Plan).
(d) In the event of a Change in Control in which the holders of the Company’s outstanding
Common Stock receive cash in exchange for such Common Stock, the portion of the Restricted Stock
that is exchanged for cash shall become vested and cease to be Restricted Stock immediately prior
to such Change in Control. In the event of any other consideration payable in a Change in Control,
the portion of the Restricted Stock exchanged for such other consideration shall become vested and
cease to be Restricted Stock (but shall remain subject to the other terms of this Agreement and the
Plan) immediately upon the Participant’s incurring a Termination by the Company (or any successor
thereto) without Cause occurring after such Change in Control.
(e) For the purposes hereof, “Cause” shall mean (i) the Participant’s willful misconduct or
gross negligence in the performance of his duties under the letter agreement between the
Participant and the Company dated as of May 3, 2004 (the “Employment Agreement”), that is not cured
by the Participant within thirty (30) days after his receipt of written notice from the Company;
(ii) the Participant’s conviction of, or plea of guilty or nolo contendere to, a crime relating to
the Company or any affiliate or any felony; or (iii) a material breach by the Participant of the
Employment Agreement or any other material written agreement entered into between the Participant
and the Company that is not cured by the Participant within thirty (30) days after his receipt of
written notice from the Company.
3. Restrictions on Transfer. The Participant shall not sell, negotiate, transfer,
pledge, hypothecate, assign, encumber or otherwise dispose of the Shares or grant any proxy with
respect thereto, except as specifically permitted by the Plan and this Agreement. Any attempted
Transfer in violation of this Agreement and the Plan shall be void and of no effect and the Company
shall have the right to disregard the same on its books and records and to
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issue “stop transfer” instructions to its transfer agent. Notwithstanding the foregoing,
nothing herein or in the Plan shall prohibit the Participant from pledging the Shares the
Participant is granted hereunder to the Company pursuant to a stock pledge agreement entered into
between the parties hereto.
4. Forfeiture. (a) The provisions in Section 8.l of the Plan regarding Detrimental
Activity shall apply to the Restricted Stock.
(b) If the Participant incurs a Termination for any reason, the Company shall repurchase from
the Participant for the Purchase Price paid for such shares of Restricted Stock, any and all
Restricted Stock.
5. Rights as a Holder of Restricted Stock. From and after the issue date, the
Participant shall have, with respect to the shares of Restricted Stock, all of the rights of a
holder of shares of Common Stock, including, without limitation, the right to vote the Shares, to
receive and retain all regular cash dividends payable to holders of Shares of record on and after
the issue date (although such dividends will be treated, to the extent required by applicable law,
as additional compensation for tax purposes), and to exercise all other rights, powers and
privileges of a holder of Shares with respect to the Restricted Stock, with the exceptions that (i)
the Participant shall not be entitled to delivery of the stock certificate or certificates
representing the Restricted Stock until such shares are no longer Restricted Stock; (ii) the
Company (or its designated agent) will retain custody of the stock certificate or certificates
representing the Restricted Stock and any other property (“RS Property”) issued in respect of the
Restricted Stock, including stock dividends at all times such Shares are Restricted Stock; (iii) no
RS Property will bear interest or be segregated in separate accounts; and (iv) the Participant
shall not, directly or indirectly, Transfer the Restricted Stock in any manner whatsoever.
6. Taxes; Section 83(b) Election. The Participant acknowledges, subject to the last
sentence of this paragraph, that (i) no later than the date on which any Restricted Stock shall
have become vested, the Participant shall pay to the Company or, to the extent permitted by law,
deliver to the Company outstanding shares of Common Stock held by the Participant or make other
arrangements satisfactory to the Company regarding payment of, any Federal, state or local taxes of
any kind required by law to be withheld with respect to any Restricted Stock which shall have
become so vested; (ii) the Company shall, to the extent permitted by law, have the right to deduct
from any payment of any kind otherwise due to the Participant any Federal, state or local taxes of
any kind required by law to be withheld with respect to any Restricted Stock which shall have
become so vested, including that the Company may, but shall not be required to, sell a number of
Shares sufficient to cover applicable withholding taxes or arrange for shares to be delivered on a
“net” basis, in each case subject to applicable law; and (iii) in the event that the Participant
does not satisfy (i) above on a timely basis, the Company may (to the extent permitted by
applicable law), but shall not be required to, pay such required withholding and treat such amount
as a demand loan to you at the maximum rate permitted by law, with such loan, at the Company’s sole
discretion and provided the Company so notifies the Participant within thirty (30) days of the
making of the loan, secured by the Shares, and any failure by you to pay the loan upon demand shall
entitle the Company to all of the rights at law of a creditor secured by the Shares. The Company
may hold as security any certificates representing any Shares and, upon demand of the Company, the
Participant shall deliver to the Company any certificates in his or her possession representing
Shares together with a stock power duly endorsed in blank. The Participant also acknowledges that
it is his or her sole responsibility, and not the Company’s, to file timely and properly any
election under
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Section 83(b) of the Code, and any corresponding provisions of state tax laws, if the
Participant wishes to utilize such election.
7. Legend. In the event that a certificate evidencing Restricted Stock is issued, the
certificate representing the Shares shall have endorsed thereon the following legends:
(a) “THE ANTICIPATION, ALIENATION, ATTACHMENT, SALE, TRANSFER, ASSIGNMENT, PLEDGE, ENCUMBRANCE
OR CHARGE OF THE SHARES OF STOCK REPRESENTED HEREBY ARE SUBJECT TO THE TERMS AND CONDITIONS
(INCLUDING FORFEITURE) OF THE MARKETAXESS HOLDINGS INC. (THE “COMPANY”) 2004 STOCK INCENTIVE PLAN
(THE “PLAN”) AND AN AGREEMENT ENTERED INTO BETWEEN THE REGISTERED OWNER AND THE COMPANY DATED AS OF
THE 31st DAY OF JANUARY, 2006. COPIES OF SUCH PLAN AND AGREEMENT ARE ON FILE AT THE PRINCIPAL
OFFICE OF THE COMPANY.”
(b) Any legend required to be placed thereon by applicable blue sky laws of any state.
Notwithstanding the foregoing, in no event shall the Company be obligated to issue a certificate
representing the Restricted Stock prior to vesting as set forth in Section 2 hereof.
8. Securities Representations. The Shares are being issued to the Participant and
this Agreement is being made by the Company in reliance upon the following express representations
and warranties of the Participant. The Participant acknowledges, represents and warrants that:
(a) The Participant has been advised that the Participant may be an “affiliate” within the
meaning of Rule 144 under the Securities Act and in this connection the Company is relying in part
on the Participant’s representations set forth in this section;
(b) The Shares must be held indefinitely by the Participant unless (i) an exemption from the
registration requirements of the Securities Act is available for the resale of such Shares or (ii)
the Company files an additional registration statement (or a “re-offer prospectus”) with regard to
the resale of such Shares and the Company is under no obligation to continue in effect a Form S-8
Registration Statement or to otherwise register the resale of the Shares (or to file a “re-offer
prospectus”);
(c) The exemption from registration under Rule 144 will not be available under current law
unless (i) a public trading market then exists for the Common Stock of the Company, (ii) adequate
information concerning the Company is then available to the public, and (iii) other terms and
conditions of Rule 144 or any exemption therefrom are complied with and that any sale of the Shares
may be made only in limited amounts in accordance with such terms and conditions.
9. Not an Employment Agreement. Neither the execution of this Agreement nor the
issuance of the Shares hereunder constitute an agreement by the Company to employ or to continue to
employ the Participant during the entire, or any portion of, the term of this Agreement, including
but not limited to any period during which any Shares are outstanding.
10. Power of Attorney. The Company, its successors and assigns, is hereby appointed
the attorney-in-fact, with full power of substitution, of the Participant for the
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purpose of carrying out the provisions of this Agreement and taking any action and executing
any instruments which such attorney-in-fact may deem necessary or advisable to accomplish the
purposes hereof, which appointment as attorney-in-fact is irrevocable and coupled with an interest.
The Company, as attorney-in-fact for the Participant, may in the name and stead of the
Participant, make and execute all conveyances, assignments and transfers of the Restricted Stock,
other RS Property, Shares and property provided for herein, and the Participant hereby ratifies and
confirms that which the Company, as said attorney-in-fact, shall do by virtue hereof.
Nevertheless, the Participant shall, if so requested by the Company, execute and deliver to the
Company all such instruments as may, in the judgment of the Company, be advisable for this purpose.
11. Miscellaneous.
(a) This Agreement shall inure to the benefit of and be binding upon the parties hereto and
their respective heirs, personal legal representatives, successors, trustees, administrators,
distributees, devisees and legatees. The Company may assign to, and require, any successor
(whether direct or indirect, by purchase, merger, consolidation or otherwise) to all or
substantially all of the business and/or assets of the Company or any affiliate by which the
Participant is employed to expressly assume and agree in writing to perform this Agreement.
Notwithstanding the foregoing, the Participant may not assign this Agreement other than with
respect to Shares Transferred in compliance with the terms hereof.
(b) This award of Restricted Stock shall not affect in any way the right or power of the Board
or stockholders of the Company to make or authorize an adjustment, recapitalization or other change
in the capital structure or the business of the Company, any merger or consolidation of the Company
or subsidiaries, any issue of bonds, debentures, preferred or prior preference stock ahead of or
affecting the Common Stock, the dissolution or liquidation of the Company, any sale or transfer of
all or part of its assets or business or any other corporate act or proceeding.
(c) The Participant agrees that the award of the Restricted Stock hereunder is special
incentive compensation and that it, any dividends paid thereon (even if treated as compensation for
tax purposes) and any other RS Property will not be taken into account as “salary” or
“compensation” or “bonus” in determining the amount of any payment under any pension, retirement or
profit-sharing plan of the Company or any life insurance, disability or other benefit plan of the
Company.
(d) No modification or waiver of any of the provisions of this Agreement shall be effective
unless in writing and signed by the party against whom it is sought to be enforced.
(e) This Agreement may be executed in one or more counterparts, all of which taken together
shall constitute one contract.
(f) The failure of any party hereto at any time to require performance by another party of any
provision of this Agreement shall not affect the right of such party to require performance of that
provision, and any waiver by any party of any breach of any provision of this Agreement shall not
be construed as a waiver of any continuing or succeeding breach of such provision, a waiver of the
provision itself, or a waiver of any right under this Agreement.
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(g) The headings of the sections of this Agreement have been inserted for convenience of
reference only and shall in no way restrict or modify any of the terms or provisions hereof.
(h) All notices, consents, requests, approvals, instructions and other communications provided
for herein shall be in writing and validly given or made when delivered, or on the second
succeeding business day after being mailed by registered or certified mail, whichever is earlier,
to the persons entitled or required to receive the same, at the addresses set forth at the heading
of this Agreement or to such other address as either party may designate by like notice. Notices
to the Company shall be addressed to the Compensation Committee of the Board.
(i) This Agreement shall be construed, interpreted and governed and the legal relationships of
the parties determined in accordance with the internal laws of the State of Delaware without
reference to rules relating to conflicts of law.
(j) By executing this Agreement within 60 days after the day and year first written above, the
award of Restricted Stock shall be accepted by the Participant within the time period required
under Section 8.2(b) of the Plan.
12. Provisions of Plan Control. This Agreement is subject to all the terms,
conditions and provisions of the Plan, including, without limitation, the amendment provisions
thereof, and to such rules, regulations and interpretations relating to the Plan as may be adopted
by the Committee and as may be in effect from time to time. The Plan is incorporated herein by
reference. A copy of the Plan has been delivered to the Participant. If and to the extent that
this Agreement conflicts or is inconsistent with the terms, conditions and provisions of the Plan,
the Plan shall control, and this Agreement shall be deemed to be modified accordingly. Unless
otherwise indicated, any capitalized term used but not defined herein shall have the meaning
ascribed to such term in the Plan. This Agreement contains the entire understanding of the parties
with respect to the subject matter hereof (other than any other documents expressly contemplated
herein or in the Plan) and supersedes any prior agreements between the Company and the Participant.
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly executed as of
the day and year first above written.
| MARKETAXESS HOLDINGS INC. |
||||
| By: | /s/ Xxxxxxx X. XxXxx | |||
| Name: | Xxxxxxx X. XxXxx | |||
| Title: | President and Chief Executive Officer | |||
| By: | /s/ Xxxxxxxx Boise | |||
| Name: | Xxxxxxxx Boise | |||
| Title: | Head of Human Resources | |||
| /s/ Xxxxxxx X. XxXxx | ||||
| Xxxxxxx X. XxXxx | ||||
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