<PAGE>
EXHIBIT 10.53
AMENDED AND RESTATED EMPLOYMENT AGREEMENT (this "Agreement") dated
and
effective as of September 28, 2005, by and
among LPA HOLDING CORP., a Delaware
corporation ("LPA Holdings"), LA PETITE
ACADEMY, INC., a Delaware corporation
(the "Company") and GARY A. GRAVES
("Executive").
RECITALS
WHEREAS, the Company, LPA Holdings and Executive are party to
an
existing Employment Agreement (the
"Original Agreement") dated August 26, 2002
(the "Commencement Date");
WHEREAS, the Company, LPA Holdings and the Executive wish to amend
and
restate the Original Agreement in its
entirety;
WHEREAS, in order to induce Executive to agree to serve as
Chief
Executive Officer and President of the
Company, LPA Holdings and the Company
desire to provide Executive with
compensation and other benefits on the terms
and conditions set forth in this Agreement;
and
NOW, THEREFORE, it is therefore hereby agreed by and among the
parties
as follows:
Section 1.
Employment.
(a) Subject to the terms and conditions of this Agreement, the
Company
agrees to continue to employ Executive as
Chief Executive Officer and President.
In his capacity as Chief Executive Officer
and as President of the Company,
Executive shall have all of the customary
powers, responsibilities and
authorities of presidents and chief
executive officers of corporations of the
size, type and nature of the Company. For
so long as Executive shall serve as an
officer of the Company, Executive shall
serve as a member of the Company's Board
of Directors (the "Board").
(b) Subject to the terms and conditions of this Agreement,
Executive
hereby accepts continued employment as
Chief Executive Officer and as President,
of the Company and agrees to devote his
full working time and efforts, to the
best of his ability, experience and talent,
to the performance of services,
duties and responsibilities in connection
therewith. Nothing in this Agreement
shall preclude Executive from engaging,
consistent with his duties and
responsibilities hereunder, in charitable
and community affairs, from managing
his personal investments or, except as
otherwise provided in Section 14 hereof,
from serving as a member of boards of
directors or as a trustee of other
companies, associations or entities.
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Section 2. Term
of Employment. Subject to the valid execution of a
Stockholders Written Consent on or prior to
the Commencement Date approving the
terms of this Agreement, the Executive's
term of employment under this Agreement
shall be deemed to have commenced on the
Commencement Date and, subject to the
terms hereof, shall terminate on the third
anniversary of the Commencement Date
(the "Termination Date"); provided,
however, that on such anniversary date and
on each subsequent one-year anniversary
thereof, the Termination Date shall
automatically be extended for a period of
one year unless either party shall
have given written notice to the other
party not less than ninety days prior to
such Termination Date that the Termination
Date shall not be so extended.
Section 3.
Compensation.
(a) Initial Base Salary. The Company shall pay Executive a base
salary
("Base Salary") at the annual rate of
$425,000. The Base Salary shall be payable
in accordance with the ordinary payroll
practices of the Company and shall be
subject to increase as determined by the
Board or its compensation committee;
provided, however that the Base Salary, as
in effect from time to time, may not
be decreased.
(b) Annual Bonus. In addition to his Base Salary, Executive shall
be
entitled to receive a cash bonus (the
"Bonus") with respect to each fiscal year;
provided that, except as otherwise provided
in this Agreement, the Executive is
employed by the Company on the last day of
such fiscal year. The Bonus shall be
paid as follows:
(i) Prior to the end of each fiscal year the Board, in good
faith
consultation
with the Executive, shall determine the target EBITDA for the
immediately
succeeding fiscal year (the "Plan EBITDA") for use in
determining the
Company's bonus payable to participants in the Company's
bonus pool. For
purposes hereof, EBITDA shall be as defined in the
Indenture dated
as of May 11, 1998, among the Company, PNC Bank, as
Trustee, and the
other parties thereto.
(ii) The Executive shall be entitled to a Bonus based upon the
attainment of a
specified percentage of the actual EBITDA in relation to
Plan EBITDA. No
Bonus will be payable in the event that actual EBITDA is
less than 90% of
Plan EBITDA and the maximum bonus of 200% of Base Salary
is payable only
when actual EBITDA is more than 110% of Plan EBITDA. If
actual EBITDA as
a percentage of Plan EBITDA falls within one of the
gradations
specified below, the percentage of Base Salary specified below
will be earned
in even increments within the relevant gradation.
<TABLE>
<CAPTION>
Range of EBITDA
Percentage of Base Salary
---------------
-------------------------
<S>
<C>
90% or less of Plan EBITDA
0%
More than 90% but less than or
50%
equal to 100% of Plan EBITDA
More than 100% but less than or
100%
equal to 110% of Plan EBITDA
More than 110% of Plan EBITDA
200%
</TABLE>
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(c) Options. LPA Holdings agrees to cause to be granted to the
Executive options to purchase 180,254
shares of common stock of LPA Holdings at
an exercise price of $0.01 per share. One
forty-eighth of the options will vest
and become exercisable on the Commencement
Date and the remaining options will
vest and become exercisable at a rate of
one forty-eighth per month on the 19th
day of each month following the
Commencement Date for a 47 month period
thereafter. Such vesting will be
accelerated upon the earlier of the
consummation of a Change-in-Control (as
defined in the LPA Holdings' 1998 Stock
Option Plan) or the consummation of an
underwritten registered public offering
of Common Stock of LPA Holdings. Such
options and the underlying shares will be
issued pursuant to an agreement that
contains repurchase rights, tag-along
rights, drag along rights and other
provisions substantially equivalent to those
set forth in the LPA Holdings' 1998 Stock
Option Plan.
(d) Compensation Plans and Programs. Executive shall participate in
any
compensation plan or program, annual or
long-term, maintained by the Company on
terms no less favorable than those
applicable to other senior management
personnel of the Company. The Company
acknowledges that the Executive has been
issued equity interests of LPA Investment
LLC pursuant to the Fourth Amended and
Restated Operating Agreement as of
September 28, 2005, by and among LPA
Investment LLC, J.P. Morgan Partners (23A
SBIC), LLC, Robert E. King and the
King Children Trust Partnership. The
foregoing reference to such agreement shall
not shall provide Executive with any
additional benefits, remedies or rights
under this Agreement.
Section 4.
Employee Benefits.
(a) Employee Benefit Programs, Plans and Practices. During the term
of
his employment hereunder, the Company shall
provide to Executive coverage under
any employee benefit programs, plans and
practices (commensurate with his
positions in the Company and to the extent
possible under any employee benefit
plan), in accordance with the terms hereof,
which the Company makes available to
its senior executive officers, including
but not limited to (i) retirement,
pension and profit-sharing, and (ii)
medical, dental, hospitalization, life
insurance, short and long-term disability,
accidental death and dismemberment
and travel accident coverage.
(b) Vacation and Fringe Benefits. Executive shall be entitled to a
paid
vacation each fiscal year of no less than
four weeks. The Company may, in its
sole discretion, grant additional vacation
time to Executive. Executive shall
participate in any fringe benefits offered
to other senior management personnel
of the Company, including directors and
officers insurance to the extent offered
by the Company, on terms no less favorable
than those applicable to such other
senior management personnel.
Section 5.
Expenses. Executive is authorized to incur reasonable expenses
in carrying out his duties and
responsibilities under this Agreement, including
without limitation, expenses for travel and
similar items related to such duties
and responsibilities. The Company will
reimburse Executive for all such expenses
upon presentation by Executive from time to
time of an itemized account of such
expenditures.
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Section 6. Termination of
Employment.
(a) The Company may terminate Executive's employment at any time,
and
Executive may terminate his employment at
any time, both subject to the notice
requirements as specifically set forth
herein. Nothing contained in this
Agreement shall limit Executive's rights
under the Consolidated Omnibus Budget
Reconciliation Act.
(b) Termination Not for Cause or Termination for Good Reason.
(i) If Executive's employment is terminated (1) by the Company
other than for
Cause (as defined in Section 6(c)(ii) hereof), (2) due to
Executive's
death or disability, (3) by Executive for Good Reason (as
defined in
Section 6(b)(ii) hereof) or (4) due to the Company's written
election not to
extend the Termination Date as provided in Section 2
hereof,
Executive shall be entitled to receive from the Company, in lieu
of
any other cash
compensation provided for herein but not in substitution for
compensation
already paid or earned, payable in accordance with the
Company's
customary payroll payment practices, for the Severance Period,
an
amount equal to
the sum of (A) the Executive's Base Salary at its then
current annual
rate plus (B) two times the Bonus for the fiscal year in
which the
Executive's employment is terminated at 100% of Base Salary.
For
purposes hereof,
the term "Severance Period" means (x) if such termination
occurs on or
prior to the one-year anniversary of the Commencement Date, 6
months from the date of
termination and (y) if such termination occurs
subsequent to
the one-year anniversary of the Commencement Date or pursuant
to Section
(6)(b)(ii)(E) below, 12 months from the date of termination.
Additionally,
upon such termination Executive shall be entitled to the
following:
(A) within a reasonable period of time after the date of
termination, a cash lump sum equal to (x) any compensation
payments
deferred by Executive, together with any applicable interest or
other
accruals thereon; (y) any unpaid amounts, as of the date of
such
termination, in respect of the Bonus for the fiscal year ending
before
the fiscal year in which such termination occurs and (z) any
unpaid
amounts, as of the date of such termination, in respect of accrued
but
unpaid vacation time and outstanding business expenses incurred
in
connection with the Company's policies;
(B) for the period from the date of termination of Executive's
employment until the end of the Severance Period, the Executive
shall
continue to be covered under and participate in the Company's
employee
benefit programs, plans and practices described in Section
4(a)(ii)
hereof or under such other plans of the Company which provide
for
equivalent coverage to the extent and on the terms in effect on
Executive's date of termination (other than any disability plan
for
which
coverage cannot be maintained after such termination);
(C) the rights to payments under applicable plans or programs,
including but not limited to those described in Section 3(d)
hereof, as
may be determined pursuant to the terms of such plans or programs.
This
Section 6(b)(i) shall survive the termination or expiration of
this
Agreement;
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(D) senior executive level outplacement services to be provided
at the expense of the Company by a firm selected by the
Executive
within six (6) months following the date the Executive's
employment
with the Company is terminated; provided, however that the cost of
such
senior executive level outplacement services shall not exceed
$25,000.
(ii) For purposes of this Agreement, "Good Reason" shall mean
the
occurrence of
any of the following events without Executive's express prior
written consent
and which event shall not have been cured within a 10 day
period after
notice from the Executive:
(A) the assign
