<PAGE>
Exhibit 10.23
SEPARATION AND RELEASE AGREEMENT
THIS SEPARATION
AND RELEASE AGREEMENT ("Agreement") is made this 26th day
of August, 2005, effective as of the close
of business August 26, 2005
("Effective Date"), by and between
Ameritrade Holding Corporation, and its
successors and assigns (collectively, the
"Company") and John P. Ricketts,
Executive Vice President, Chief Operating
Officer, Vice Chairman and Corporate
Secretary, his heirs, representatives,
affiliates, successors and assigns
(collectively the "Employee").
WITNESSETH:
WHEREAS,
Employee and the Company are parties to an Employment Agreement
dated September 9, 2002, (the "Employment
Agreement") pursuant to which Employee
is employed by the Company; and
WHEREAS, the
Company and Employee agree that the Employee's employment
under the Employment Agreement shall
terminate without cause as of close of
business on August 26, 2005; and
WHEREAS, the
Company recognizes Employee's longstanding, unique and
valuable contributions made over his 12
years of loyal service to the Company;
and
WHEREAS, as a
condition precedent to Employee receiving certain of the
severance benefits enumerated in the
Employment Agreement, Employee and Company
agreed to execute this Agreement.
NOW, THEREFORE,
in consideration of the covenants undertaken in this
Agreement, including the release contained
herein, the parties agree as follows:
1. Severance Payments In full
and complete satisfaction of Employee's
claims under the Employment Agreement, including, but not limited
to,
salary, vacation, bonus, stock options, severance, change in
control
payments, incentive pay, sick pay, benefits, holiday, out
placement
services and other compensation of any kind, and exclusively in
consideration of services provided by Employee as part of his
employment and as consideration for the promises contained in
this
Agreement, including but not limited to the release set forth
in
paragraph 6 herein, upon the later to occur of (a) expiration of
the
seven (7) day revocation period explained in Section 15 below, or
(b)
the Effective Date ("Expiration Date") and subject to
Employee's
compliance with the terms of this Agreement, the Company agrees
to
provide Employee with the following payments and benefits, as
reiterated below for convenience:
a. The Company
shall pay Employee an amount of
one-million-five-hundred-thousand dollars ($1,500,000), in a
lump sum on September 9, 2005 (from which all
-1-
<PAGE>
applicable federal, state, and local taxes shall be
withheld; and
b. A prorated
Management Incentive Plan bonus (the "Prorated
MIP") payable at the same time as would have been received
if the Employee had not terminated employment, on or about
October 31, 2005. The Prorated MIP shall be calculated based
upon the following formula: Actual full year calculated
bonus (the "Actual 2005 MIP Bonus") multiplied by the number
of days employed during fiscal year 2005 divided by the
total number of days in fiscal year 2005. This calculation
is Actual 2005 MIP Bonus x (336 / 371), representing 90.57%
of Actual 2005 MIP Bonus;
c. Employee
shall receive payment of his accrued but unused
paid time off (the "PTO") balance, payable on September 9,
2005;
d. If the
Employee or any of his dependents are participating
in medical and dental coverage under any Company group
medical or dental plan, the Company will pay the employer
premium costs of the coverage (the "Employer Premium") for
twelve (12) months from September 1, 2005 through August 31,
2006 (the "Covered Period"). Employee will pay the employee
portion of monthly premiums (the "Employee Premium") by
remitting a check payable to the Company by the tenth (10th)
of each month, commencing in September 2005 in the amount of
three-hundred-forty-nine dollars and forty-six cents
($349.46) for medical and thirty-six dollars and seventy-two
cents ($36.72) for dental coverage. Employee Premium may be
adjusted as rates change for all employees (the "New Rates")
and Company will notify Employee of such rate change.
Company will pay to the Employee an amount equal to monthly
Employee Premiums, subject to New Rates as applicable and
grossed up for taxes at supplemental withholding rates on
the first regularly scheduled payroll dates of each month
during the Covered Period. To the extent Employee is
eligible for medical or dental coverage under another plan
(the "Other Coverage"), Employee will immediately notify
Company and Company will cease Company medical or dental
coverage coincident with the end of the calendar month
Employee is eligible for Other Coverage. To the extent
-2-
<PAGE>
that Employee is not eligible for Other Coverage, at the end
of the Covered Period, Employee shall be eligible for COBRA
continuation coverage (as described in Section 4980B of the
Internal Revenue Code of 1986, as amended).
e. Employee's
Company stock options shall be governed by the
terms of the respective stock option agreements and the
applicable plan document.
Except as provided herein, Employee will be entitled to no other
or
further compensation, remuneration, payments or benefits of any
kind,
including but not limited to bonuses, paid time off hours,
profit
sharing and/or 401(k) plan Company contributions, insurances and
other
salary continuation benefits. However, nothing in this Agreement
is
intended to divest Employee of any vested rights, if any, in a
Profit
Sharing and/or 401(k) plan.
2. Assignment of Claims. In
consideration of the payments and benefits to
Employee in Section 1 herein, and Employee's execution of this
Agreement, and as an express condition of this Agreement,
Employee
hereby represents and warrants that, up through the date on which
this
Agreement is executed by the parties, he has not assigned or
transferred, and he will not after such date assign or transfer,
(a)
any claims against the Company, (b) any rights that he may have had
to
assert compulsory or permissive counterclaims against the Company,
or
(c) any rights that he has or may have to aforesaid payments
and
benefits.
3. Return of Property. Employee
hereby agrees that, within ten (10)
calendar days after the Effective Date, he shall turn over to
the
Company all company equipment and property, including but not
limited,
to computers, printers, and related equipment, cell phones,
pagers,
Company Credit cards, and keys, as well as originals and copies
of
notes, correspondence, memoranda, records, documents, computer
disks
and files, and all other information or products, no matter how
produced or reproduced, pertaining to the business of the Company,
its
subsidiaries, affiliates, officers, and shareholders ("Company
Materials"), it being hereby acknowledged that all of said items
are
the sole and exclusive property of the Company. Employee's
signature
on this Agreement shall serve as a representation and warranty
that
Employee has not retained any originals or copies of Company
Materials.
4. Non-Compete and
Confidentiality. As an inducement for the Company to
enter into this Agreement and in furtherance of the terms of
the
-3-
<PAGE>
Employment Agreement, Employee expressly agrees that he
provides
unique and specialized services, skills and expertise to the
Company,
and that the Company hired him because of the unique and
specialized
services, skills and expertise he is able to provide. Employee
further
expressly agrees that he has been given access to Confidential
Information and trade secrets of the Company and Ameritrade and
their
subsidiaries (collectively "Ameritrade"). Accordingly, Employee
acknowledges and reaffirms his obligations under the terms of
Sections
4 and 5 of the Employment Agreement through the Effective Date and
for
a 12 month period thereafter ("Restricted Period").
5. Remedies for Breach The
parties agree that it will be very difficult
to determine damages caused to the Company should there be a breach
by
Employee of the provisions of this Agreement, including, but
not
limited to, Section 4, and therefore, in addition to any other
rights
or remedies afforded to the Company and not as a penalty,
further
agree that if a breach of any of the provisions of t
