Archipelago Learning,
LLC
This Employment
Agreement (this “ Agreement ”) is entered into
as of this 28 th day of August, 2009 by and between Archipelago
Learning, LLC, a Delaware limited liability company (the “
Company ”), and Julie A. Huston (the “
Executive ”).
WHEREAS, the
Company desires to engage the services of the Executive and the
Executive desires to be employed by the Company;
WHEREAS, the
Company desires to be assured that the unique and expert services
of the Executive will be available to the Company, and that the
Executive is willing and able to render such services on the terms
and conditions hereinafter set forth; and
WHEREAS, the
Company desires to be assured that the confidential information and
good will of the Company will be preserved for the exclusive
benefit of the Company.
NOW, THEREFORE, in
consideration of such employment and the mutual covenants and
promises herein contained, and for other good and valuable
consideration, the receipt and sufficiency of which are hereby
acknowledged, the Company and the Executive agree as
follows:
1 EMPLOYMENT
AND RESPONSIBILITIES
The Company will
employ the Executive in the position of Vice President, Sales,
beginning on August 1, 2009 (the “ Start Date
”). The Executive shall report to the Chief Executive
Officer. The Executive will have such authority, and will perform
all of the duties, normally associated with this position as well
as other duties as may be reasonably assigned to her from time to
time by the Board of Managers of the Company (the “
Board ”) or the Chief Executive Officer, in each case
consistent with her position as Vice President, Sales.
The Executive will
devote all of her business time, ability, attention and best
efforts to the performance of her duties hereunder in a manner
which will faithfully and diligently further the Company’s
business to the exclusion of all other business activities.
However, the Executive may devote reasonable periods of time to
engaging in charitable or community service activities, so long as
none of these activities interfere with her duties under this
Agreement. Executive agrees to perform her duties and
responsibilities within Company policies, standard work hours and
attendance and general work practices.
The
Executive’s employment hereunder initially shall be for a
term commencing on the Start Date and ending on the day preceding
the second anniversary of the Start Date, subject to earlier
termination in accordance with Section 6 below. The
Agreement shall be automatically
D-Employment
Agreement (Julie A. Huston)
extended from
year to year thereafter unless either party gives not less than
sixty (60) days prior written notice to the other that such
party elects to have the Agreement terminated effective at the end
of the initial or then current renewal term.
During the term of
employment under this Agreement, the Company agrees to pay to the
Executive, and she agrees to accept in full consideration for all
services performed by her, the following compensation:
4.1 Base
Salary: The Company will pay the Executive an annual base
salary of one-hundred-fifty-thousand dollars ($155,000), before all
customary payroll deductions. This annual base salary will be paid
in accordance with the usual payroll practices of the Company. The
Board may make such increases in the base salary as the Board may,
in its sole discretion, deem appropriate.
4.2 Bonus:
During the Executive’s employment term, the Executive will
participate in the Company-wide sales bonus plan in which all sales
managers of the Company participate based on the bonus plan’s
policies and procedures then in effect. Executive will be eligible
to receive in respect of each semi-annual period of the fiscal year
of the Company (commencing with the semi-annual periods ending on
December 31, 2009 and June 30, 2010) a semi-annual bonus
(the “ Bonus ”) in an amount equal to up to 50%
of her earned base salary (prorated for partial periods) based on,
among other things, revenue and cost performance targets
established by the Board of Managers by reference to the operating
plan approved from time to time by the Board of Managers;
provided , that if the performance targets in any periods of
each fiscal year are exceeded, the maximum bonus the Executive
shall be eligible to receive shall equal up to 60% of her base
salary for each semi-annual period. The bonus payments, if any,
shall be paid by the Company no later than the 30th day of July for
the January 1 st — June 30 th period and the 30 th day of January for July 1
st — December 31
st period to which such semi-annual bonus
relates.
4.3 Incentive
Equity: The Executive will have the right to participate in the
Company’s incentive equity plan, as determined by the Board
of Directors and CEO
4.4
Withholding: The Company may withhold from any compensation and
benefits payable to the Executive all applicable federal, state and
local withholding taxes.
5.1
Description of Benefits: During the term of employment under
this Agreement, the Executive will be entitled to participate in
all employee incentive, pension and welfare benefit plans and
programs made available generally to other senior executives of the
Company, as such plans or programs may be in effect from time to
time (including, without limitation, incentive equity, profit
sharing, savings and other pension and retirement plans or
programs, medical, dental, hospitalization, short-term and
long-term disability and life insurance plans, accidental death and
dismemberment protection, and any other pension or retirement plans
or programs and any other employee incentive compensation plans,
employee welfare benefit plans or programs that may be sponsored by
the Company from time to time and provided that
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Executive meets
the eligibility requirements and other terms, conditions and
restrictions of the respective plans and programs, including any
plans that supplement the above-listed types of plans or programs,
whether funded or unfunded). Payment for such coverages will be the
sole responsibility of the Executive, unless the Company makes such
coverages available to similarly situated executives on a shared
cost basis. In addition, the Executive will be entitled to 4 weeks
of paid vacation per year. The Company will pay for all reasonable
expenses actually incurred by the Executive directly in connection
with the business affairs of the Company and the performance of her
duties hereunder, upon presentation of proper receipts or other
proof of expenditure and subject to such reasonable guidelines or
limitations provided by the Company from time to time.
The
Executive’s employment under this Agreement may be terminated
as follows, but in the event of any such termination, the
provisions of Sections 7 and 8 will survive the
termination of the Executive’s employment.
6.1 By the
Company: The Company may terminate the employment of the
Executive, with or without Cause (as defined in
Section 7.5 hereof), at any time during the term hereof
by delivery of a Notice of Termination (as defined below) to the
Executive.
6.2 By the
Executive: The Executive may terminate her employment at any
time, for any reason, by delivery of a Notice of Termination to the
Company.
6.3 Death;
Disability: The Executive’s employment will terminate
automatically upon the Executive’s death or total disability.
The term “ total disability ” will mean the
Executive’s inability to perform the duties set forth in
Section 1 hereof for a period of twelve
(12) consecutive weeks, or a cumulative period of 90 business
days in any 12-month period, as a result of physical or mental
illness or loss of legal capacity.
6.4
Notice: The term “ Notice of Termination ”
means at least thirty (30) days’ prior written notice of
termination of the Executive’s employment (the “
Advance Notice Period ”), during which period the
Executive’s employment and performance of services will
continue; provided, that (i) the Executive may, upon
termination of her employment for Good Reason, make such notice
effective immediately, (ii) the Company may, upon termination
of his employment with or without Cause, make such notice
immediately and (iii) the Company may, upon notice to the
Executive and without reducing compensation during any Advance
Notice Period, excuse her from any or all of her duties during any
Advance Notice Period. The effective date of termination of
employment (the “ Termination Date ”) will be
the date on which such Advance Notice Period expires (or the date
of notice, if the Company exercises its rights under clause
(ii) hereof or if the Executive exercises her rights under
clause (i) hereof) or as otherwise provided in
Section 3 above.
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In the event of
termination of the employment of the Executive, all compensation
and benefits set forth in this Agreement will terminate as of the
Termination Date except as specifically provided in this
Section 7 :
7.1
Termination by the Company:
(a) If the
Company terminates the Executive’s employment without Cause
(other than as result of death or total disability), and such
termination constitutes a “separation from service”
under Section 409A of the Internal Revenue Code of 1986, as
amended (“ Section 409A ”), she will not be
entitled to receive any of the payments or benefits provided for
herein except the Company shall (i) pay her base salary
through the Termination Date, (ii) pay her a Bonus or a
pro-rated Bonus for the calendar year in which the Termination Date
fell, based on the number of days of such calendar year that the
Executive was employed by the Company (the “ Pro-Rated
Bonus ”), as applicable, (iii) pay her an amount
equal to her base salary during the Severance Period (as defined in
Section 7.7 below) payable in equal installments, in
accordance with the Company’s normal payroll practices,
beginning with the first payroll date following the 45th day after
the Termination Date, (iv) provide the Executive with all
benefits that are accrued but unpaid as of the Termination Date,
and (v) provide the Executive with all benefits expressly
available upon termination of employment in accordance with the
plans and programs of the Company applicable to the Executive on
the Termination Date (but without duplication of any benefits or
payments otherwise provided for hereunder). Notwithstanding
anything herein to the contrary, for the avoidance of doubt, when
calculating the Pro Rated Bonus under this Section 7.1 or any
other Section of this Agreement such calculation shall be
determined based on the actual performance achieved by the Company
during the applicable fiscal period, and shall be paid by the
Company when other bonus payments are made to similarly situated
employees.
(b) If
the Company terminates the Executive’s employment for Cause,
and such termination constitutes a “separation from
service” under Section 409A, she will not be entitled to
receive any of the payments or benefits provided for herein except
the Company shall (i) pay her base salary through the
Termination Date, (ii) provide the Executive with all benefits
that are accrued but unpaid as of the Termination Date, and
(iii) provide the Executive with all benefits expressly
available upon termination of employment in accordance with the
plans and programs of the Company applicable to the Executive on
the Termination Date (but without duplication of any benefits or
payments otherwise provided for hereunder).
7.2
Termination by the Executive:
(a) If the
Executive terminates her employment with the Company with Good
Reason (as hereinafter defined), and such termination constitutes a
“separation from service” under Section 409A, she will
not be entitled to receive any of the payments or benefits provided
for herein except the Company shall (i) pay her base salary
through the Termination Date, (ii) pay her a Pro-Rated Bonus,
(iii) pay her an amount equal to her base salary during the
Severance Period payable in equal installments, in accordance with
the Company’s normal payroll practices, beginning with the
first payroll date following the 45th day after the Termination
Date, (iv) provide the Executive with all benefits that are
accrued but unpaid as of the Termination
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Date, and
(v) provide the Executive with all benefits expressly
available upon termination of employment in accordance with the
plans and programs of the Company applicable to the Executive on
the Termination Date (but without duplication of any benefits or
payments otherwise provided for hereunder).
(b) If the
Executive terminates her employment with the Company without Good
Reason, and such termination constitutes a “separation from
service” under Section 409A, she will not be entitled to
any payments or benefits provided for herein except the Company
shall (i) pay her base salary through the Termination Date,
(ii) provide the Executive with all benefits that are accrued
but unpaid as of the Termination Date, and (iii) provide the
Executive with all benefits expressly available upon termination of
employment in accordance with the plans and programs of the Company
applicable to the Executive on the Termination Date (but without
duplication of any benefits or payments otherwise provided for
hereunder).
7.3 Expiration
of Term, Death or Disability:
(a) If the
Executive’s employment is terminated pursuant to
Section 3 hereof as a result of the expiration of the
term of this Agreement, and such termination constitutes a
“separation from service” under Section 409A, she
will not be entitled to any payments or benefits provided for
herein except the Company shall (i) pay her base salary
through the Termination Date, (ii) provide the Executive with
all benefits that are accrued but unpaid as of the Termination
Date, and (iii) provide the Executive with all benefits
expressly available upon termination of employment in accordance
with the plans and programs of the Company applicable to the
Executive on the Termination Date (but without duplication of any
benefits or payments otherwise provided for hereunder).
(b) If the
Executive’s employment is terminated pursuant to Section
6.3 hereof as a result of her death or total disability, and
such termination constitutes a “separation from
service” under Section 409A, she will not be entitled to
any payments or benefits, except the Company shall (i) pay her
base salary through the Termination Date, (ii) provide the
Executive with all benefits that are accrued but unpaid as of the
Termina
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