Exhibit 10.2
EFFECTIVE DATE
June 1, 2011 to May 31, 2012
CABINET LEVEL OFFICER COMPENSATION PLAN
This compensation plan is made up of three components. For purposes of this
plan, the title “Cabinet Level” refers to those individuals who have been
appointed to and serve as a member of the President’s Cabinet (other than the
chief executive officer/CEO and President). In addition, this plan and its
components are based on the performance of National American University
Holdings, Inc. (“NAUH”)
Component 1: BASE PAY COMPUTATION
The Board of Directors, in consultation with the chief executive officer/CEO,
will determine the specific base salary of the Cabinet Level Officer positions.
Additional factors which may be considered by the Board of Directors in
determining the actual base salary include, but are not limited to, experience
level, educational level, assessment of satisfactory performance, years of
service, and performance expectations for the upcoming year.
Component 2: QUARTERLY ACHIEVEMENT OF ORGANIZATIONAL OBJECTIVES
The second component of the compensation plan will be based on achievement of
specific quarterly organizational objectives (the “Additional Quarterly
Compensation”). The Additional Quarterly Compensation will be based on NAUH
quarterly pre-tax profit margin and objectives related to institutional
effectiveness. The amount of the Additional Quarterly Compensation will be
calculated quarterly by taking the appropriate percentage multiplied by the
Cabinet Level Officer’s current annual base salary. The Cabinet Level Officer
will receive a percentage of his/her annual base salary each quarter based on
achieving the objectives listed below. The two objectives and percentages are
listed below.

              Quarterly   Percentage of     Objective   Annual Base Salary  
Description            
 
  1     5% per quarter  
For achieving the approved budgeted NAUH pre-tax profit margin for the quarter.
           
 
  2     5% per quarter  
For achieving predetermined NAUH quarterly objectives related to institutional
effectiveness.

Objective 1: successfully achieving the approved NAUH budgeted pre-tax profit
margin per quarter as determined and approved by the Board prior to June 1st.
Objective 2: successfully achieving the predetermined quarterly organizational
objectives related to institutional effectiveness. These objectives will be
determined prior to June 1st and published for each Cabinet Level Officer to
review.
The Additional Quarterly Compensation is based on achieving the organizational
objectives for the prior quarter. Additional Quarterly Compensation, if any,
will be determined quarterly and paid semi-monthly on the Company’s regular
payroll schedule in five (5) equal payroll installments beginning after the
financial statements for the prior quarter have been finalized.
In order to be eligible to earn Additional Quarterly Compensation for a given
quarter, the Cabinet Level Officer must be employed by NAUH or its affiliates
during the entire quarter in which the objectives are measured and when the
amount of the Additional Quarterly Compensation is determined. No Additional
Quarterly Compensation will be paid after employment is terminated. The Board of
Directors will be solely responsible for determining whether the objectives for
the Additional Quarterly Compensation are satisfied and the amount of any
Additional Quarterly Compensation.

 

 

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Component 3: ANNUAL ACHIEVEMENT AWARD
The final component of the compensation plan will be based on NAUH’s Earnings
Before Interest and Taxes (“EBIT”). To the extent that NAUH’s actual EBIT for
the fiscal year exceeds NAUH’s budgeted EBIT for the fiscal year, twenty percent
(20%) of the excess would be designated for an “Annual Achievement Award.” The
total Annual Achievement Award would then be distributed to Cabinet Level
Officers, with Cabinet Level Officer receiving  _____  % of the total, up to a
maximum of 60% of his/her annual base salary.
Calculations will be based on the annual budget for NAUH, as approved by the
Board prior to June 1st, and the final audited financial statements prepared for
the fiscal year ending May 31st. The Annual Achievement Award will be paid in
six (6) equal payroll installments beginning September 1st of each year (1st
payment will be September 7th).
In order to be eligible to earn the Annual Achievement Award for a given year,
the Cabinet Level Officer must be employed by NAUH or its affiliates during the
entire year in which the objectives are measured and when the amount of the
Annual Achievement Award is determined. No Annual Achievement Award will be paid
after employment is terminated. The Board of Directors will be solely
responsible for determining whether the objectives for the Annual Achievement
Award are satisfied and the amount of any Annual Achievement Award.
GENERAL PROVISIONS
This compensation plan does not create a contract of employment, express or
implied, or alter the employment at-will relationship between you and NAUH or
its affiliates, including the university. This document is not intended by
reason of its distribution to confer any rights or privileges upon you or to
entitle you to be or remain employed by NAUH or its affiliates, including the
university. The contents of this plan are presented as a guide and as a matter
of information only. While NAUH believes wholeheartedly in the plan, it is not a
condition of employment and may not be relied upon by you as a contract or other
right. The provisions of this compensation plan are subject to change at anytime
by the NAUH or its affiliates without any notice and without anyone’s agreement.
Further, business conditions, federal and state law, and/or organizational needs
are constantly in flux and may require that portions of this document be revised
or rewritten.
The Cabinet Level Officer is subject to the provisions of the National American
University Employee Handbook (NAUM 4-0).
Notwithstanding any provision in this compensation plan to the contrary, any
portion of the payments and benefits provided under this compensation plan shall
be subject to any clawback policy adopted by or applicable to NAUH pursuant to
the Dodd-Frank Wall Street Reform and Consumer Protection Act, any Securities
and Exchange Commission rule, any applicable listing standard promulgated by any
national securities exchange or national securities association, or any other
legal requirement.
* * * * *
I acknowledge receipt of a copy of the Cabinet Level Officer Compensation Plan
and further acknowledge that my employment is not governed by any written or
oral contract, including this document, and that my employment is considered an
at-will arrangement.

     
 
   
 
   
Cabinet Level Officer
  Date
 
   
 
   
 
   
Dr. Ronald L. Shape
  Date
CEO