Exhibit 10.1
AMENDED AND
RESTATED
EMPLOYEE ADVISOR
AGREEMENT
THIS EMPLOYEE ADVISOR AGREEMENT, as
amended and restated (the “ Agreement ”), is
entered into as of May 30, 2008 by and between Investment
Technology Group, Inc., a Delaware corporation (the “
Company ”), and Raymond L. Killian, Jr. (the
“ Employee ”).
BACKGROUND
WHEREAS, the Company and the
Employee previously entered into an employee advisor agreement on
February 27, 2007 (the “ Prior Agreement
”); and
WHEREAS, the parties now wish to
amend the Prior Agreement to provide that payments due to the
Employee upon the Employee’s termination of employment under
the Prior Agreement will be compliant with the applicable
requirements of section 409A of the Internal Revenue Code of 1986,
as amended (the “ Code ”) and the regulations
promulgated thereunder.
NOW, THEREFORE
, in consideration of the mutual
promises hereinafter set forth, and intending to be legally bound
hereby, the Company and the Employee hereby agree as
follows:
1.
Term
. The term of this Agreement
began on April 1, 2007 and shall continue until March 31,
2009, unless terminated sooner pursuant to Section 9 below
(the “ Term ”).
2.
Services to be
Provided .
(a)
Advisory Services
. During the Term, the
Employee shall perform for the Company such reasonable transition
services (taking into account the Employee’s other
commitments) and other advisory services as shall be reasonably
assigned to the Employee by the Chief Executive Officer and
President of the Company and the Board of Directors of the Company
(the “ Board ”) from time to time. The
foregoing duties of the Employee shall be referred to for purposes
of this Agreement as the “ Advisory Services
.”
(b)
Working Time
. During the Term, the
Employee agrees to devote substantial working time, attention and
energies to the Advisory Services on a schedule mutually acceptable
to the Employee and the Company. The Employee agrees that he
shall generally be available to perform the Advisory Services and
at the Company’s Boston office when required. The
Employee shall give the Company advance notice of periods of
vacation. The Company agrees that the Employee will not be
employed on a full-time basis and may provide services to other
companies, including by serving as a member of the boards of
directors of other companies; provided that the Employee shall be
required to comply with the restrictive covenants set forth in
Section 4 below.
3.
Compensation;
Benefits .
(a)
Compensation
. As compensation for the
Employee’s performance of the Advisory Services under this
Agreement during the Term, the Employee shall receive (i) a
salary of $100,000 per month payable in accordance with the
Company’s normal payroll practices and
subject to all applicable employment and tax
withholdings, and (ii) on or around April 1, 2009, and,
assuming the satisfactory performance of the Employee’s
assigned duties hereunder, in the reasonable and good faith
judgment of the Board, a one time severance payment of
$600,000. In addition, the Company shall reimburse the
Employee for all reasonable expenses incurred by the Employee in
connection with the performance of the Advisory Services in
accordance with the Company’s expense reimbursement policies
for executives.
(b)
Employee Benefits
. During the Term, the
Employee shall continue to be entitled to participate in and
receive any benefit or rights under any Company employee benefit
plans, including, without limitation, employee insurance, medical,
pension, savings or deferred compensation plans. Upon the
completion of the Term, as a retiree of the Company, the Company
shall provide the Employee and his spouse with medical benefits for
the remainder of their lives at coverage levels substantially
similar to those provided to senior executive employees of the
Company from time to time. Such medical benefits shall either
be provided under the Company’s medical benefit plan or
through Company paid medical insurance obtained by the Company for
the benefit of the Employee and his spouse.
(c)
Effect of Termination
.
(i)
If, prior to the expiration of the
Term, the Company terminates the Employee’s employment with
the Company for any reason other than Cause (as defined below), the
payments described in Sections 3(a)(i) and (ii) shall
continue to be made as severance and be paid in installments as and
when they would otherwise have been made pursuant to the terms of
this Agreement as if the Employee’s employment with the
Company had not been terminated, but the benefits provided pursuant
to Section 3(b) shall cease except for medical benefits
as set forth above in Section 3(b). Notwithstanding the
preceding sentence, if, at any time during the payment period, the
Employee agrees to waive his rights to the continued payments
described in Sections 3(a)(i) and (ii), the Employee shall
have no further obligation to comply with the restrictions set
forth in Sections 4(c) and (d) following his
termination.
(ii)
If the Employee voluntarily
terminates his employment with the Company for any reason or if the
Employee’s employment is terminated by the Company for Cause,
in either case, prior to the expiration of the Term, no further
payments shall be due under the terms of this Agreement; provided
that, in each case, the medical benefits as set forth in
Section 3(b) shall continue. For this purpose, the
term “ Cause ” means (A) gross negligence
in the performance of the Employee’s duties which results in
material financial harm to the Company or its subsidiaries;
(B) the Employee’s conviction of, or plea of nolo
contendere to, any felony, or other crime involving the personal
enrichment of the Employee at the expense of the Company or its
subsidiaries (unless the Employee’s action or omission
occurred in good faith in the reasonable belief that such action
was not criminal); (C) willful refusal by the Employee to
perform his duties and responsibilities without the same being
corrected within thirty (30) days after being given written notice
thereof; or (D) the material breach by the Employee of any of
the covenants contained in Section 4 of this Agreement.
Notwithstanding the above, “Cause” shall not exist
unless the Employee shall have been given written notice that the
Company believes it has “Cause”, the Employee has had
the opportunity to appear before the Board with counsel of his
choice to answer the assertion, and such Board by a two-thirds
vote, not including the Employee, has thereafter voted to terminate
the Employee’s service for Cause.
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(iii)
Notwithstanding the provisions of
Sections 3(c)(i) and (ii) above, if at the time of the
Employee’s “separation from service” (as such
term is defined in section 409A of the Code) the Company has
securities which are publicly-traded on an established securities
market and the Employee is a “specified employee” (as
such term is defined in section 409A of the Code) and it is
necessary to postpone the commencement of any severance payments
otherwise payable pursuant to this Agreement as a result of such
separation from service to prevent any accelerated or additional
tax under section 409A of the Code, then the Company shall postpone
the commencement of the payment of any such payments or benefits
hereunder (without any reduction in such payments or benefits
ultimately paid or provided to the Employee) that are not otherwise
paid within the short-term deferral exception under section 409A of
the Code and are in excess of the lesser of two (2) times
(i) the Employee’s then-annual compensation or
(ii) the limit on compensation then set forth in section
401(a)(17) of the Code, until the first payroll date that occurs
after the date that is six (6) months following the
Employee’s separation from service with the Company. If
any payments are postponed due to such requirements, such postponed
amounts shall be paid in a lump sum to the Employee, and any
installment payments due to the Employee shall recommence, on the
first payroll date that occurs after the date that is six
(6) months following the Employee’s separation from
service with the Company. If the Employee dies during the
postponement period prior to the payment of the postponed amount,
the amounts postponed on account of section 409A of the Code shall
be paid to the personal representative of the Employee’s
estate within sixty (60) days after the date of the
Employee’s death.
(d)
Change in Control
. Upon the occurrence of a
Change in Control during the Term, the Company shall pay to the
Employee all of the amounts he would have otherwise received
through the remainder of the Term as set forth in Sections
3(a)(i) and (ii) had he remained in service throughout
that period. Payment shall be made in a lump sum within
thirty (30) days following the occurrence of the Change in
Control. For this purpose, “ Change in Control
” means and shall be deemed to have occurred:
(i)
if any person (within the meaning of
the Securities Exchange Act of 1934, as amended (the “
Exchange Act ”)), other than the Company or a Related
Party, is or becomes the “beneficial owner” (as defined
in Rule 13d-3 under the Exchange Act), directly or indirectly,
of Voting Securities representing thirty-five percent (35%) or more
of the total voting power of all the then-outstanding Voting
Securities; or
(ii)
if a majority of the members of the
Board is replaced during any twelve month period by directors whose
appointment or election is not endorsed by a majority of the
members of the Board before the date of the appointment or
election; or
(iii)
upon consummation of a merger,
consolidation, recapitalization or reorganization of the Company,
reverse split of any class of Voting Securities, or an acquisition
of securities or assets by the Company other than (A) any such
transaction in which the holders of outstanding Voting Securities
immediately prior to the transaction receive (or retain), with
respect to such Voting Securities, voting securities of the
surviving or transferee entity representing more than fifty percent
(50%) of the total voting power outstanding immediately after such
transaction, with the voting power of each such continuing holder
relative to other such continuing holders not substantially altered
in the transaction, or (B) any such transaction which would
result in a Related Party beneficially owning more than fifty
percent (50%) of the
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voting securities of the surviving or transferee
entity outstanding immediately after such transaction;
or
(iv)
upon consummation of the sale or
disposition by the Company of all or substantially all of the
Company’s assets, other than any such transaction which would
result in a Related Party owning or acquiring more than fifty
percent (50%) of the assets owned by the Company immediately prior
to the transaction.
For purposes of the foregoing definition, the
following terms shall have the following meanings:
(A) “ Voting Securities or Security ” means
any securities of the Company which carry the right to vote
generally in the election of directors; (B) “
Subsidiary ” or “ Subsidiaries ”
means, with respect to any Person, any corporation, partnership,
limited liability company, association or other business entity of
which (a) if a corporation, fifty (50) percent or more of the
total voting power of shares of stock entitled (without regard to
the occurrence of any contingency) to vote in the election of
directors, managers or trustees thereof is at the time owned or
controlled, directly or indirectly, by that Person or one or more
of the other Subsidiaries of that Person or combination thereof; or
(b) if a partnership, limited liability company, association or
other business entity, fifty (50) percent or more of the
partnership or other similar ownership interest thereof is at the
time owned or controlled, directly or indirectly, by any Person or
one or more Subsidiaries of that Person or a combination
thereof. For purposes of this definition, a Person or Persons
shall be deemed to have a fifty (50) percent or more ownership
interest in a partnership, limited liability company, association
or other business entity if such Person or Persons are allocated
fifty (50) percent or more of partnership, limited liability
company, association or other business entity gains or losses or
control the managing director or member or general partner of such
partnership, limited liability company, association or other
business entity; (C) “ Related Party ”
means (a) a Subsidiary of the Company; (b) an employee or
group of employees of the Company or any Sub
