| Item 5.02 | Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers. |
On August 12, 2021, MarketAxess Holdings Inc. (“MarketAxess”) entered into a severance protection agreement ( the “Severance Protection Agreement”) with Christopher N. Gerosa. The Severance Protection Agreement provides Mr. Gerosa with severance payments and benefits upon a qualifying termination of employment, subject to Mr. Gerosa’s execution of a waiver and general release.
The Severance Protection Agreement has an initial term of five years and renews thereafter for successive one-year terms, unless the Company provides written notice of nonrenewal at least twelve months prior to the expiration date of the then-applicable term; provided, that if the agreement is in effect at the time of a Change in Control (as defined in the Severance Protection Agreement), the term shall continue in perpetuity thereafter.
Upon a termination of employment by the Company without Cause (as defined in the Severance Protection Agreement) prior to a Change in Control or following the second anniversary of a Change in Control, or upon resignation by Mr. Gerosa for Good Reason (as defined in the Severance Protection Agreement) following the second anniversary of a Change in Control, Mr. Gerosa shall receive the following: (i) a severance payment equal to 1.0 times the sum of (x) Mr. Gerosa’s base salary (as in effect on the termination date, or if greater, as of immediately prior to the Change in Control) plus (y) the average of the annual cash bonuses earned by and payable to Mr. Gerosa for the three years preceding the year in which the termination date occurs (or, if greater, the three years preceding the year in which a Change in Control occurs), payable in regular installments over twelve months; (ii) a pro-rata bonus payment for the year of termination equal to the average of the annual cash bonuses earned by and payable to Mr. Gerosa for the three years preceding the year in which the termination date occurs (or, if greater, the three years preceding the year in which a Change in Control occurs), prorated based on the number of days worked during the year in which termination occurs, payable in a lump sum; (iii) to the extent earned but not paid, the annual bonus for the year preceding the year in which the termination date occurs, generally payable at the same time as other bonuses to senior executives; (iv) payment of any COBRA health and welfare premiums for twelve months following the termination date (or, in lieu thereof, taxable monthly payments in an after-tax amount equal to such COBRA health and welfare premiums); and (v) with respect to any then-unvested equity or equity-based incentive awards, (A) any such award subject solely to time- or service-based vesting shall continue to become vested, exercisable and payable on the same schedule for twelve months following the termination date as if Mr. Gerosa had remained actively employed, and (B) any such award subject to performance-based vesting shall continue to become vested, exercisable and payable on the same schedule for twelve months following the termination date as if Mr. Gerosa had remained actively employed (x) based on actual performance for any performance period that is completed during such twelve month period, or (y) based on target performance level for any performance period that is not completed during such twelve month period.
Upon a termination of employment by the Company without Cause or resignation by Mr. Gerosa for Good Reason within two years following a Change in Control, Mr. Gerosa shall receive the following: (i) a severance payment equal to 1.5 times the sum of (x) Mr. Gerosa’s base salary (as in effect on the termination date, or if greater, as of immediately prior to the Change in Control) plus (y) the average of the annual cash bonuses earned by and payable to Mr. Gerosa for the three years preceding the year in which the termination date occurs (or, if greater, the three years preceding the year in which a Change in Control occurs), payable in a lump sum; (ii) a pro-rata bonus payment for the year of termination equal to the average of the annual cash bonuses earned by and payable to Mr. Gerosa for the three years preceding the year in which the termination date occurs (or, if greater, the three years preceding the year in which a Change in Control occurs), prorated based on the number of days worked during the year in which termination occurs, payable in a lump sum; (iii) to the extent earned but not paid, the annual bonus for the year preceding the year in which the termination date occurs, generally payable at the same time as other bonuses to senior executives; (iv) payment of any COBRA health and welfare premiums for eighteen months following the termination date (or in lieu thereof, taxable monthly payments in an after-tax amount equal to such COBRA health and welfare premiums); and (v) with respect to any then-unvested equity or equity-based incentive awards, (A) any such award subject solely to time- or service-based vesting shall immediately vest in full, and (B) any such award subject to performance-based vesting shall immediately vest (x) based on actual performance for any performance period that is completed prior to Mr. Gerosa’s termination date, or (y) based on target performance level for any performance period that is not completed prior to Mr. Gerosa’s termination date.
Upon a termination of employment due to death or disability, Mr. Gerosa shall receive the following: (i) a severance payment equal to 0.5 times the sum of (x) Mr. Gerosa’s base salary (as in effect on the termination date, or if greater, as of immediately prior to the Change in Control) plus (y) the average of the annual cash bonuses earned by and payable to Mr. Gerosa for the three years preceding the year in which the termination date occurs (or, if greater, the three years preceding the year in which a Change in Control occurs), payable in a lump sum; (ii) a pro-rata bonus payment for the year of termination equal to 0.5 times the average of the annual cash bonuses earned by and payable to Mr.��Gerosa for the three years preceding the year in which the termination date occurs (or, if greater, the three years preceding the year in which a Change in Control occurs), prorated based on the number of days worked during the year in which termination occurs, payable in a lump sum; (iii) to the extent earned but not paid, the annual bonus for the year preceding the year in which the termination date occurs, generally payable at the same time as other bonuses to senior executives; (iv) payment of any COBRA health and welfare premiums for twelve months following the termination date (or in lieu thereof, taxable monthly payments in an after-tax amount equal to such COBRA health and welfare premiums); and (v) with respect to any then-unvested equity or equity-based incentive awards, (A) 100% of any such award subject solely to time- or service-based vesting shall immediately vest in full and the remainder shall be immediately forfeited, and (B) 100% of any such award subject to performance-based vesting shall immediately vest (x) based on actual performance for any performance period that is completed prior to Mr. Gerosa’s termination date, or (y) based on target performance level for any performance period that is not completed prior to Mr. Gerosa’s termination date.
