Exhibit 10.1
RESTRICTED STOCK AGREEMENT
PURSUANT TO THE
MARKETAXESS HOLDINGS INC. 2004 STOCK INCENTIVE PLAN
     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
140 Broadway, 42nd Floor, New York, New York 10005 (the “Company”), and Richard
M. McVey 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:

 

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                  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/ Richard M. McVey         Name:   Richard M. McVey       
Title:   President and Chief Executive Officer              By:   /s/ Cordelia
Boise         Name:   Cordelia Boise        Title:   Head of Human Resources   
          /s/ Richard M. McVey       Richard M. McVey           

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