Second Amendment to Employment Agreement
Exhibit 10.7
Second Amendment to Employment Agreement
This SECOND AMENDMENT TO EMPLOYMENT AGREEMENT (this “Amendment”) is made and entered
into by and between Study Island, LLC, a Delaware limited liability company (the
“Company”) and Xxxxxxx Xxxxxxxx (the
“Executive”) as of December 31, 2008
for purposes of amending that certain employment agreement by and between the Company and the
Executive dated January 10, 2007, as amended by that certain letter agreement by and between the
Company and the Executive dated November 21, 2008 (the “Employment Agreement”). Terms used
in this Amendment with initial capital letters that are not otherwise defined herein shall have
the meanings ascribed to such terms in the Employment Agreement.
W I T N E S S E T H
WHEREAS, the Company and the Executive desire to amend the Employment Agreement to bring the
provisions into compliance with Section 409A of the Internal Revenue Code of 1986, as amended;
NOW, THEREFORE, in consideration of the mutual covenants and conditions hereafter set forth
and for other good and valuable consideration, the Company and the Executive agree as follows:
1. Section 4.2 of the Employment Agreement is hereby amended by adding the
following sentence to the end of said section:
The bonus payments, if any, shall be paid by the Company no later than the 15th day
of the third calendar month of the fiscal year following the fiscal year to which
such annual bonus relates.
2. Section 7.1 of the Employment Agreement is hereby amended by deleting said
section in its entirety and replacing it with the following:
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”), he will not be entitled to receive any of the payments
or benefits provided for herein except the Company shall (i) pay his base salary
through the Termination Date, (ii) pay him an amount equal to his 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, (iii) provide the Executive with all benefits that are accrued
but unpaid as of the Termination Date, and (iv) 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
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Termination Date (but without duplication of any benefits or payments otherwise
provided for hereunder).
(b)
If the Company terminates the Executive’s employment for Cause, and such
termination constitutes a “separation from service” under Section 409A, he will not
be entitled to receive any of the payments or benefits provided for herein except
the Company shall (i) pay his 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).
3. Section 7.2 of the Employment Agreement is hereby amended by deleting said
section in its entirety and replacing it with the following:
7.2 Termination by the Executive:
(a) If the Executive terminates his employment with the Company with Good
Reason (as hereinafter defined), and such termination constitutes a “separation from
service” under Section 409A, he will not be entitled to receive any of the payments
or benefits provided for herein except the Company shall (i) pay his base salary
through the Termination Date, (ii) pay him an amount equal to his 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, (iii) provide the Executive with all
benefits that are accrued but unpaid as of the Termination Date, and (iv) 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 his employment with the Company without Good
Reason, and such termination constitutes a “separation from service” under Section
409A, he will not be entitled to any payments or benefits provided for herein except
the Company shall (i) pay his 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).
4. Section 7.3 of the Employment Agreement is hereby amended by deleting said
section in its entirety and replacing it with the following:
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7.3 Expiration of Term, Death or Disability: If the Executive’s employment is terminated pursuant to Section 6.3 hereof as a result of
the expiration of the term of such employment, or his death or total disability,
and such termination constitutes a “separation from
service” under Section 409A, he will not be entitled to any payments or benefits provided for herein except the
Company shall (i) pay his 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).
5. Section 7.4 of the Employment Agreement is hereby amended by deleting said
section in its entirety and replacing it with the following:
7.4 Payment Schedule: All payments of base salary under this
Section 7 (excluding wages for services performed prior to the
Termination Date)
shall be paid in accordance with the Company’s normal payroll
practices,
beginning with the first payroll date following the 45th day after the
Termination
Date. Payment of wages for services performed prior to the
Termination Date
shall be paid in accordance with the Company’s normal payroll practices without
regard to the 45 day delay. Any bonus amounts due under this Section 7
shall be
paid promptly following the Company’s receipt of its audited financial
statements
for the year during which the Termination Date occurs, but in no event later
than
the 15th day of the third calendar month of the fiscal year following the
fiscal
year in which the Termination Date occurred, and in no event earlier than the
45th
day following the Termination Date. Each payment made in accordance with this
Section 7 shall be treated as a separate payment for purposes of
Section 409A, to
the extent Section 409A applies to such payments.
6. Section 7.6 of the Employment Agreement is hereby amended by deleting said
section in its entirety and replacing it with the following:
7.6 Good Reason: Whenever reference is made in this Agreement to termination
being with or without Good Reason, “Good Reason” shall mean the occurrence of any of
the following events without the Executive’s express written consent: (i) any
material breach by the Company of any material provision of this Agreement, (ii) a
material reduction in the Executive’s base salary, or (iii) a material reduction or
diminution of the Executive’s duties, responsibilities or authorities which are
caused by an act of the Company. The Company shall have 30 days after receipt of
notice from the Executive setting forth the specific conduct that constitutes Good
Reason, to cure such conduct that would result in Good Reason. The Executive may not
resign his employment for Good Reason unless the executive has provided the Company
with at least 30 days prior written notice of his intent to resign for Good Reason
(which notice must be provided
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within 60 days following (x) the occurrence of the event(s) purported to constitute
Good Reason, or (y) if the Executive did not know of the occurrence of any of such
events, the date on which the Executive had actual knowledge of the occurrence of
any of such events) and has set forth in reasonable detail the specific conduct that
constitutes Good Reason and the specific provisions of this Agreement on which the
Executive relies.
7. Section 7.8 of the Employment Agreement is hereby amended by deleting said
section in its entirety and replacing it with the following:
7.8 Payments Contingent on Release: The Company’s obligation to make any
payments of base salary or bonus under this Section 7 shall be contingent
upon the Executive executing a general release concerning the Executive’s employment
in form and substance reasonably acceptable to the Company and the Executive, within
45 days following the Termination Date. No such contingency shall apply to any
obligation to provide benefits under this Section 7.
8. Except as expressly amended by this Amendment, the Employment Agreement
shall continue in full force and effect in accordance with the provisions thereof.
The next page is the signature page.
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IN WITNESS WHEREOF, the parties have executed and entered into this Amendment on the date set
forth above.
| EXECUTIVE: | ||||||
| /s/ Xxxxxxx Xxxxxxxx | ||||||
| Xxxxxxx Xxxxxxxx | ||||||
| STUDY ISLAND, LLC | ||||||
| By: | /s/ Xxxxxxx XxXxxx | |||||
| Name: | ||||||
| Title: | CEO | |||||
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