The Princeton Review,
Inc.
This
Employment Agreement (along with its Exhibits, (this
“Agreement”) is between Stephen Melvin
(“Exec”) and The Princeton Review, Inc.
(“TPR”), and is subject to the terms of the current
form of the Executive Compensation Policy Statement, dated
July 1, 2005, a copy of which is attached as Exhibit A
(the “Policy Statement”). Capitalized terms used herein
are defined in The Princeton Review Glossary, also dated
July 1, 2005, the current form of which governs this Agreement
and is attached as Exhibit B. This Agreement supersedes any
previous agreement with respect to Exec.
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1.
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Job Description:
Starting
January 26, 2007 (the “Effective Date”), Exec
shall serve as EVP and Chief Financial Officer. Exec shall devote
full business time and energies to the business affairs, including
management and financial responsibilities, of TPR. Further he will
use his best efforts, skill and abilities to promote TPR’s
interests, in accordance with guidelines, policies and objectives
established by TPR.
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2.
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Compensation:
TPR shall pay Exec an
annual base salary of $297,052 in accordance with TPR’s
normal payroll practices as of January 17, 2007.
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3.
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Benefits: Exec shall also receive those
medical, dental, life insurance benefits and D&O insurance
benefits made available by TPR to the other G-0 Executives of TPR
as a class in accordance with TPR policies.
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4.
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Transition Expenses:
Until such point that
Exec is covered by TPR’s health insurance plan, TPR shall
reimburse Exec for the cost of his health insurance.
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5.
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Term: This Agreement has an initial
expiration date of July 1, 2007 but will automatically be
extended for additional six months period upon the completion of
the initial term and any six-months extension period thereafter
until (i) Exec voluntarily terminates employment or
(ii) TPR gives contrary written notice to Exec at least one
month prior to the completion of the initial term or any six-months
extension period thereafter.
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6.
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Severance: If TPR terminates Exec’s
employment for any reason other than for Cause or if this Agreement
is terminated under Section 4.2 or 4.3 of the Policy
Statement, then in lieu of the payments provided under
Sections 5.2, 5.3 and 5.4 of the Policy Statement, TPR will
pay Exec an amount equal to three months of his annual base salary
in effect at the time of termination, payable in accordance with
TPR’s standard payroll practices; provided, however, that in
order to be eligible to receive such severance payments under this
Section 5, Exec shall have executed and delivered to TPR a
release agreement in the form of Exhibit B . If Exec
leaves voluntary anytime after April 1, 2007, Exec will be
eligible for a severance payment of $50,000. Exec shall be employed
at-will, and either party may terminate Exec’s employment
with or without Cause at any time. This is in lieu of any other
payment.
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7.
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This Agreement shall be interpreted
under the laws of the State of New York. If any provision of this
Agreement shall be found to be invalid or unenforceable, that
provision only shall be deemed to be deleted, or revised to validly
express the intention of the parties, and the remainder of this
Agreement, by intention of the parties shall remain valid and
enforceable to the fullest extent permitted by law. This Agreement
may be executed in counterparts This Agreement is personal to Exec
and may not be assigned by him. TPR may assign this Agreement to
any successor or affiliate. This Agreement constitutes and contains
the entire agreement and understanding of the parties with respect
to the subject
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matter hereof
and a modification of this Agreement will be binding only if in
writing and executed by both parties.
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Agreed to this
January 19, 2007.
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/s/ Stephen
Melvin
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Stephen
Melvin
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The
Princeton Review, Inc.
2005 Executive
Compensation Policy Statement
The Princeton
Review, Inc (“TPR”) wants to fairly compensate its
senior management in a consistent and clear way. This document will
serve as an addendum to the employment agreements of executives
selected by the Chief Executive Officer (“CEO”) or the
Board of Directors (the “Board”).
The issues
covered are as follows: (1) Who is eligible;
(2) Responsibilities and Non-compete; (3) Term &
Compensation; (4) Termination for Cause, Disability or Death;
(5) Severance Benefits and Payments; (6) Change of
Control; and the always-popular (7) Legal Stuff.
Section 1. Who is Eligible
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1.1.
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The
CEO or the Board shall decide who will be covered under the
Executive Compensation Policy.
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1.2.
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An
executive will not be covered under the Executive Compensation
Policy unless he or she has an effective employment agreement that
provides for such participation.
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Section 2. Responsibilities and
Non-compete
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2.1.
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So
long as this Agreement continues in effect, the Executive shall
devote full business time and energies to the business affairs,
including management and financial responsibilities, of TPR.
Further, he or she will use his or her best efforts, skill and
abilities to promote their interests, in accordance with
guidelines, policies and objectives established by TPR and his or
her manager.
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2.2.
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Any
materials, writings, graphics, techniques, methods or products
relating or reasonably applicable to TPR business, or any natural
extension thereof, which may be developed by the Executive during
his or her term of employment with TPR shall inure solely and fully
to the benefit of TPR, without any additional compensation to the
Executive.
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In
addition, TPR will be the exclusive owner of all intellectual
property rights (including copyrights, patents, trade secrets,
trademarks and moral rights) in all of the Executive’s works
of authorship, inventions, and other creations, ideas, suggestions
and contributions, either standing alone or as part of a collective
work, that are within the scope of the Executive’s employment
at TPR. At TPR’s request, the Executive agrees to sign all
documents necessary to confirm this agreement and to secure and
perfect TPR’s interest in such rights. The Executive
acknowledges that during his or her
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employment with TPR, he or she may
have had otherwise prohibited access to trade secrets and other
oral or written information and materials that are confidential in
nature and proprietary to TPR. The Executive will not, at any time,
whether during or after the term of employment, directly or
indirectly, by any means or devices whatsoever, copy, retain,
disclose, use, or permit the use of or access to any confidential
business information, except as may be required in the performance
of the Executive’s duties for TPR. Upon termination or
expiration of employment with TPR, the Executive will immediately
turn over to TPR all copies of any confidential business
information in his or her possession or control.
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2.3.
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In
the event of a breach or threatened breach by the Executive of any
provision of this Agreement which would be difficult to measure in
terms of monetary damages, including, but not limited to, the
disclosure of confidential business information, or the
unauthorized rendering of services to any person or firm engaged in
a business competitive with that of TPR or its franchises as
described in Section 2.4 below, TPR shall by agreement of the
parties be entitled to obtain a restraining order, injunction and
all other appropriate equitable remedies in addition to other
applicable remedies provided by applicable law. It is expressly
agreed that the Executive’s obligation to maintain the
confidentiality of the business of TPR and its franchises, which
are not matters of general public knowledge, will survive the
termination of this Agreement.
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2.4.
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The
Executive agrees that his or her services provided to TPR are of a
special, unique and intellectual character, and the
Executive’s position with TPR places him or her in a position
of confidence and trust with the business, customers and employees
of TPR and its affiliates. Accordingly, the Executive agrees during
the term of this Agreement and for a period of eighteen (18) months
following the expiration or termination of this Agreement not
to:
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2.4.1.
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engage in any capacity, in the
business of providing assistance with or professional training for
state standards and assessments, preparation for standardized
examinations, or the college, professional school, or graduate
school admissions process, without the advance written consent of
TPR, or
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2.4.2.
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solicit the services of any employee
of TPR or any of its franchises (or any individual employed by TPR
or any of its franchises within the then most recent
12 months) or take any action that results, or might
reasonably result, in any employee ceasing to perform services for
TPR or any of its franchises and commencing to perform services for
the Executive or any person or entity associated with the
Executive. If the Executive breaches this Section 2.4, he or
she will immediately forfeit as of the time of such breach the
right to receive any severance payments or benefits under this
Agreement and forfeit the gain from any stock options exercised
following a termination of employment. In addition, TPR will be
entitled to require that the Executive repay to TPR the value of
any such payments or benefits previously paid to the Executive and
to pursue any additional remedies at law or equity, including,
without limitation, those contemplated by Section 2.3
above.
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2.5.
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If
any provision of this Section 2 is found to be void or
unenforceable, in whole or in part, then the remainder of the
provisions of this Section 2 will remain in full force and
effect and in no way be affected or impaired, and th
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