EXHIBIT 10.3 AMERITRADE HOLDING CORPORATION EXECUTIVE EMPLOYMENT AGREEMENT

 

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EXHIBIT 10.3

 

                         AMERITRADE HOLDING CORPORATION

                         EXECUTIVE EMPLOYMENT AGREEMENT

 

      This Executive Employment Agreement (the "Agreement") between AMERITRADE

HOLDING CORPORATION, a Delaware corporation (the "Company") and Bryce B. Engel

(the "Executive"), is made effective May 10, 2005 (the "Effective Date").

 

                                   Witnesseth

 

WHEREAS, The Company has employed the Executive as Managing Director, Clearing

and now desires to promote the Executive to the position of Senior Vice

President, Chief Brokerage Operations Officer.

 

WHEREAS, The Executive desires to accept the promotion offered by the Company

and continue being employed by the Company.

 

WHEREAS, The Company and the Executive desire to set forth in this Agreement,

the terms, conditions and obligations of the parties with respect to such

promotion and continued employment and this Agreement is intended by the parties

to supersede all previous agreements (Excluding for this purpose, any option

agreements dated prior to the Effective Date ("Prior Option Agreements"), which

option agreements will remain in full force and effect and be subject to the

terms of the 1996 Long Term Incentive Plan,) and understandings, whether written

or oral, concerning employment with the Company and with any subsidiary of the

Company.

 

NOW THEREFORE, In consideration of the Company entering into this Agreement and

the benefits Executive will derive from the Agreement, Executive has agreed to

be bound by the restrictive covenants contained in the terms below and the

Company and the Executive agree as follows:

 

      1. EMPLOYMENT. The Company will employ the Executive as Senior Vice

President, Chief Brokerage Operations Officer of the Company or a comparable

position as described in Section 6(e)(ii) below, upon the terms and conditions

set forth in this Agreement. The Executive will perform such duties and

responsibilities for the Company, which are commensurate with his position

subject to the reasonable direction of the Chief Executive Officer (the "CEO"),

Chief Operating Officer (the "COO") or the Chairman of the Board of Directors

(the "Chairman").

 

      2. TERM. Subject to the provisions set forth in Section 6 below, the term

of this Agreement (the "Term") will be the period beginning on the Effective

Date and ending on May__ , 2007 unless earlier terminated in accordance with

Section 6 below. Within 90 days prior to the expiration of the Term, the

Executive and COO or CEO shall negotiate terms under which this agreement will

renew for another 12 months. Notwithstanding the foregoing, upon a

 

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"Change of Control" (as defined in Section 7 below), the Term of this Agreement

will not change, unless earlier terminated in accordance with Section 6 below.

 

      3. COMPENSATION. During the Term, the Executive will be compensated for

his services to the Company in accordance with the following:

 

                  (a) Base Salary. The Company will pay to the Executive an

            annual base salary of $225,000, payable in accordance with the

            Company's policies. The Executive's annual base salary may be

            reviewed by the Company for possible increase (but not decrease)

            during the Term of this Agreement at the Company's discretion.

 

                  (b) Annual Incentive. The Executive will be eligible to

            participate in the Company's Management Incentive Plan (or any

             successor short-term incentive plan or program) (the "MIP Plan") for

            the Company's fiscal year 2005 and subsequent fiscal years during

            the Term in accordance with the terms and conditions of the MIP Plan

            with a target bonus of 60% of the Executive's annual base salary for

            each fiscal year (the "Target Bonus"). The Executive's Target Bonus

            for periods subsequent to the first year of the Term will be

            determined by the Compensation Committee of the Board of Directors

            of the Company (the "Compensation Committee") in its discretion and

            based upon performance criteria determined for each fiscal year by

            the Compensation Committee in its sole discretion but shall in no

            event be less than 60% of the Executive's annual base salary for

            such subsequent period.

 

                  (c) Long-Term Incentive Plan. The Executive will be eligible

            to participate in the Company's 1996 Long-Term Incentive Plan (or

            any successor long-term incentive plan or program) (the "LTIP"). Any

            awards made under the LTIP will be made at the sole discretion of

            the administrator of the LTIP, or the administrator's designee, and

            will be subject to the terms and conditions of the LTIP and the

            applicable award agreement. The Executive will be eligible for

            periodic option awards, at the discretion and as determined by the

            Compensation Committee from time to time, at the same time and

            contingent upon options being granted to other Company executives by

            the Compensation Committee. Number of options will be determined

            using the same valuation methodology as other Company executives'

            grants.

 

                  (d) Deferred Compensation Program. The Executive will be

            eligible to participate in the Company's Executive Deferred

            Compensation Program (or any successor deferred compensation

            program) (the "Deferred Compensation Program") in accordance with

            the terms and conditions of the Deferred Compensation Program.

 

                  (e) Benefits and Perquisites. The Executive will also receive

            such benefits and perquisites (the "Benefits") which are made

            available generally to other senior executives of the Company. All

            such Benefits will be provided in such amounts as may be determined

            from time to time by the Company in its discretion and pursuant to

            the terms of the plan documents governing such Benefits.

 

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      4. NON-COMPETITION, NON-SOLICITATION AND NON-HIRE PROVISIONS. The

Executive agrees that:

 

                  (a) During the term of this Agreement and for a period of 12

            months after the natural expiration of the Term (without renewal) or

            the Date of Termination whichever occurs first (collectively, the

            "Restricted Period"), the Executive will not (without the written

            consent of the Chief Executive Officer and the Chairman of the

            Board) engage or participate in any business within the United

            States (as an owner, partner, stockholder, holder of any other

            equity interest, or financially as an investor or lender, or in any

            capacity calling for the rendition of personal services or acts of

            management, operation or control) which is engaged in any activities

            and for any business competitive with any of the primary businesses

            conducted or formally proposed to be conducted by the Company or any

            of its Affiliates (as defined below) during the 12-month period

            prior to the Date of Termination or expiration of the Term. For

            purposes of this Agreement, the term "primary businesses" is defined

            as an online brokerage business, including active trader and long

             term investor client segments. Provided that this restriction shall

            not restrict Executive from being employed by or consulting with a

            business, firm, corporation, partnership or other entity that owns

            or operates an on-line brokerage, provided that (a) the on-line

            brokerage business is de minimis as compared to its core business in

            terms of revenue and/or resources, and (b) Executive's involvement

            with the company excludes, directly or indirectly, the on-line

            brokerage business during the Restriction Period. Notwithstanding

            the foregoing, the Executive may own securities of a Competitive

            Business so long as the securities of such corporation or other

            entity are listed on a national securities exchange or on the NASDAQ

            National Market and the securities owned directly or indirectly by

            the Executive do not represent more than one percent of the

            outstanding securities of such corporation or other entity;

 

                  (b) During the Restricted Period neither the Executive, nor

            any business in which the Executive may engage or participate in,

            will directly or indirectly (i) knowingly induce any customer or

            vendor of the Company or of corporations or businesses which

            directly or indirectly are controlled by the Company (collectively,

            the "Affiliates") to patronize any Competitive Business, (ii)

            knowingly canvass or solicit any business from any customer of the

            Company or any of its Affiliates which business is of a type that is

            similar to the business received by the Company or Affiliate from

            the customer, (iii) request or advise any customer or vendor of the

            Company or any of its Affiliates to withdraw, curtail or cancel such

            customer's or vendor's business with the Company or any of its

            Affiliates, or (iv) compete with the Company or any of its

            Affiliates in merging with or acquiring any other company or

            business (whether by a purchase of stock or other equity interests,

            or a purchase of assets or otherwise) which is a Competitive

            Business;

 

                  (c) During the Restricted Period, neither the Executive nor

            any business in which the Executive may engage or participate in

            will (i) knowingly hire, solicit or attempt to hire any employee or

            contractor of the Company or any of its Affiliates or (ii) encourage

            any employee or contractor of the Company or any of its Affiliates

            to terminate employment or contractual arrangements. For purposes of

             this Agreement,

 

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            "employee" includes current employees as well as anyone employed by

            the Company or any of its Affiliates within the prior six months

            from the Executive's Date of Termination or expiration of the Term;

            provided, however, that this provision shall not preclude any

            business in which the Executive may engage or participate in from

            hiring any such employee who responds to a public announcement

            placed by the business as long as Executive does not exercise any

            control over the business; and

 

                  (d) In the event that any of the provisions of this Section

            should ever be deemed to exceed the time, geographic or occupational

            limitations permitted by applicable laws, then such provisions will

            and are hereby reformed to the maximum time, geographic or

            occupational limitations permitted by applicable law.

 

      5. CONFIDENTIAL INFORMATION AND INTELLECTUAL PROPERTY.

 

                  (a) Except as may be required by law, or except to the extent

            required to perform the Executive's duties and responsibilities

            hereunder, the Executive will keep secret and confidential

            indefinitely all non-public confidential information (including,

            without limitation, information regarding cost of new accounts,

            activity rates of different market niche customers, advertising

            results, technology (hardware and software), architecture,

            discoveries, processes, algorithms, maskworks, strategies,

            intellectual properties, customer lists and other customer

            information) concerning any of the Company and its Affiliates which

            was acquired by or disclosed to the Executive during the course of

            the Executive's employment with the Company ("Confidential

            Information") and not use in any manner or disclose the same, either

            directly or indirectly, to any other person, firm or business

            entity.

 

                  (b) At the end of the Term (whether by expiration or

            termination) or at the Company's earlier request, the Executive will

            promptly return to the Company any and all records, documents,

            physical property, information, computer disks, drives or other

            materials relative to the business of any of the Company and its

             Affiliates obtained by the Executive during course of employment

            with the Company and not keep any copies thereof.

 

                  (c) The Executive acknowledges and agrees that all right,

            title and interest in inventions, discoveries, improvements, trade

            secrets, developments, processes and procedures made by the

            Executive, in whole or in part, or conceived by the Executive either

            alone or with others, when employed by the Company, including such

            of the foregoing items conceived during the course of employment

            which are developed or perfected after the Executive's termination

            of employment, are owned by the Company ("Company IP"). The

            Executive assigns any and all right, title and interest he may have

            to Company IP to the Company and will promptly assist the Company or

            its designee, at the Company's expense, to obtain patents,

            trademarks, copyrights and service marks concerning Company IP made

            by the Executive and the Executive will promptly execute all

            reasonable documents prepared by the Company or its designee and

            take all other reasonable actions which are necessary or appropriate

            to

 

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            secure to the Company and its Affiliates the benefits of Company IP.

            Such patents, trademarks, copyrights and service marks will at all

            times be the property of the Company and its Affiliates. The

            Executive promptly will keep the Company informed of, and promptly

            will execute such assignments prepared by the Company or its

            designee as may be necessary to transfer to the Company or its

            Affiliates the benefits of, any Company IP.

 

                  (d) To the extent that any court or agency seeks to require

            the Executive to disclose Confidential Information, the Executive

            promptly will inform the Company and take reasonable steps to

            endeavor to prevent the disclosure of Confidential Information until

            the Company has been informed of such requested disclosure, and the

            Company has an opportunity to respond to such court or agency. To

            the extent the Executive obtains information on behalf of the

            Company or any of its Affiliates that may be subject to

            attorn