Exhibit 10.14
WAIVER AND RELEASE OF CLAIMS
     1. In consideration of the payments and benefits to be made under the
Employment Agreement, dated as of December 7, 2006 (the “Employment Agreement”)
and the additional benefits (all of which are set forth in Exhibit A, attached
hereto), to which Stephen J. Weiss (the “Executive”) and Education Management
LLC (the “Company”) (each of the Executive and the Company, a “Party” and
collectively, the “Parties”) are parties, the sufficiency of which the Executive
acknowledges, the Executive, with the intention of binding himself and his
heirs, executors, administrators and assigns, does hereby release, remise,
acquit and forever discharge the Company and each of its parents, subsidiaries
and affiliates (the “Company Affiliated Group”), their present and former
officers, directors, executives, shareholders, agents, attorneys, employees and
employee benefit plans (and the fiduciaries thereof), and the successors,
predecessors and assigns of each of the foregoing (collectively, the “Company
Released Parties”), of and from any and all claims, actions, causes of action,
complaints, charges, demands, rights, damages, debts, sums of money, accounts,
financial obligations, suits, expenses, attorneys’ fees and liabilities of
whatever kind or nature in law, equity or otherwise, whether accrued, absolute,
contingent, unliquidated or otherwise and whether now known or unknown,
suspected or unsuspected, which the Executive, individually or as a member of a
class, now has, owns or holds, or has at any time heretofore had, owned or held,
arising on or prior to the date hereof, against any Company Released Party that
arises out of, or relates to, the Employment Agreement, the Executive’s
employment with the Company, or any termination of such employment, including
claims (i) for severance or vacation benefits, unpaid wages, salary or incentive
payments, (ii) for breach of contract, wrongful discharge, impairment of
economic opportunity, defamation, intentional infliction of emotional harm or
other tort, (iii) for any violation of applicable state and local labor and
employment laws (including, without limitation, all laws concerning unlawful and
unfair labor and employment practices) and (iv) for employment discrimination
under any applicable federal, state or local statute, provision, order or
regulation, and including, without limitation, any claim under Title VII of the
Civil Rights Act of 1964 (“Title VII”), the Civil Rights Act of 1988, the Fair
Labor Standards Act, the Americans with Disabilities Act (“ADA”), the Executive
Retirement Income Security Act of 1974, as amended (“ERISA”), the Age
Discrimination in Employment Act (“ADEA”), and any similar or analogous state
statute, excepting only:

  (A)   rights of the Executive arising under, or preserved by, this Agreement
(including Exhibit A attached hereto) or Section 3 or Section 7 of the
Employment Agreement;     (B)   the right of the Executive to receive COBRA
continuation coverage in accordance with applicable law;     (C)   claims for
benefits under any health, disability, retirement, life insurance or other,
similar employee benefit plan (within the meaning of Section 3(3) of ERISA) of
the Company Affiliated Group; and     (D)   rights to indemnification the
Executive has or may have under the by-laws, limited liability company agreement
or certificate of incorporation of any member of the Company Affiliated Group or

 

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      as an insured under any director’s and officer’s liability insurance
policy now or previously in force.

     2. The Employee acknowledges and agrees that the release of claims set
forth in this Agreement is not to be construed in any way as an admission of any
liability whatsoever by any Company Released Party, any such liability being
expressly denied.
     3. The release of claims set forth in this Agreement applies to any relief
no matter how called, including, without limitation, wages, back pay, front pay,
compensatory damages, liquidated damages, punitive damages, damages for pain or
suffering, costs, and attorneys’ fees and expenses.
     4. The Executive specifically acknowledges that his acceptance of the terms
of the release of claims set forth in this Agreement is, among other things, a
specific waiver of his rights, claims and causes of action under Title VII,
ADEA, ADA and any state or local law or regulation in respect of discrimination
of any kind; provided, however, that nothing herein shall be deemed, nor does
anything contained herein purport, to be a waiver of any right or claim or cause
of action which by law the Executive is not permitted to waive.
     5. As to rights, claims and causes of action arising under the ADEA, the
Executive acknowledges that he has been given but not utilized a period of
twenty-one (21) days to consider whether to execute this Agreement. If the
Executive accepts the terms hereof and executes this Agreement, he may
thereafter, for a period of seven (7) days following (and not including) the
date of execution, revoke this Agreement as it relates to the release of claims
arising under the ADEA. If no such revocation occurs, this Agreement shall
become irrevocable in its entirety, and binding and enforceable against the
Executive, on the day next following the day on which the foregoing seven-day
period has elapsed. If such a revocation occurs, the Executive shall irrevocably
forfeit any right to payment of the Severance Payment and/or Pro-Rata Annual
Bonus Payment (as such terms are defined in the Employment Agreement), but the
remainder of the Employment Agreement shall continue in full force.
     6. Other than as to rights, claims and causes of action arising under the
ADEA, the release of claims set forth in this Agreement shall be immediately
effective upon execution by the Executive.
     7. The Executive acknowledges and agrees that he has not, with respect to
any transaction or state of facts existing prior to the date hereof, filed any
complaints, charges or lawsuits against any Company Released Party with any
governmental agency, court or tribunal.
     8. The Executive acknowledges that he has been advised to seek, and has had
the opportunity to seek, the advice and assistance of an attorney with regard to
the release of claims set forth in this Agreement, and has been given a
sufficient period within which to consider the release of claims set forth in
this Agreement.
     9. The Executive acknowledges that the release of claims set forth in this
Agreement relates only to claims which exist as of the date of this Agreement.

 

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     10. The Executive acknowledges that the Severance Payments and/or Pro-Rata
Annual Bonus Payment set forth on Exhibit A he is receiving in connection with
the release of claims set forth in this Agreement and his obligations under this
Agreement are in addition to anything of value to which the Executive is
entitled from the Company and that such payments and the other benefits set
forth on Exhibit A satisfy the Company’s obligations to the Executive under the
Employment Agreement in connection with the termination of the Executive’s
employment with the Company.
     11. Each provision hereof is severable from this Agreement, and if one or
more provisions hereof are declared invalid, the remaining provisions shall
nevertheless remain in full force and effect. If any provision of this Agreement
is so broad, in scope, or duration or otherwise, as to be unenforceable, such
provision shall be interpreted to be only so broad as is enforceable.
     12. This Agreement constitutes the complete agreement of the Parties in
respect of the subject matter hereof and shall supersede all prior agreements
between the Parties in respect of the subject matter hereof except to the extent
set forth herein.
     13. The failure to enforce at any time any of the provisions of this
Agreement or to require at any time performance by another party of any of the
provisions hereof shall in no way be construed to be a waiver of such provisions
or to affect the validity of this Agreement, or any part hereof, or the right of
any party thereafter to enforce each and every such provision in accordance with
the terms of this Agreement.
     14. This Agreement may be executed in several counterparts, each of which
shall be deemed to be an original, but all of which together shall constitute
one and the same instrument. Signatures delivered by facsimile shall be deemed
effective for all purposes.
     15. This Agreement shall be binding upon any and all successors and assigns
of the Executive and the Company.
     16. Except for issues or matters as to which federal law is applicable,
this Agreement shall be governed by and construed and enforced in accordance
with the laws of the State of New York without giving effect to the conflicts of
law principles thereof.
     17. Capitalized terms used herein have the meanings given them in the
Employment Agreement unless otherwise defined herein.

 

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     IN WITNESS WHEREOF, this Agreement has been signed by or on behalf of each
of the Parties, all as of July 10, 2009.

              EDUCATION MANAGEMENT LLC
 
       
 
       
 
  By:   /s/ Todd S. Nelson
 
       
/s/ Stephen J. Weiss
 
      Name: Todd S. Nelson
STEPHEN J. WEISS, Individually
      Title: Chief Executive Officer

Solely with respect to the Stock Option Agreements described in Section 10 of
Exhibit A hereto.

          EDUCATION MANAGEMENT CORPORATION

      By:   /s/ Todd S. Nelson       Name:   Todd S. Nelson        Title:  
Chief Executive Officer       

 

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EXHIBIT A
Pursuant to the Executive’s Employment Agreement, and as otherwise agreed to by
the Company in connection with his termination of employment effective August 5,
2009 (“Termination Date”), the Company shall provide the Executive the payments
and benefits as follows:
     1. Executive’s base salary through the Termination Date and other items of
compensation accrued through that date (less applicable withholding taxes),
which amounts shall be paid on or about August 6, 2009;
     2. The Executive’s full 2009 MICP Bonus at 150% of target in the aggregate
amount of $496,500 (less applicable withholding taxes), which amount shall be
paid on or about August 6, 2009, as payment for his Pro-Rata Annual Bonus
Payment;
     3. Severance Payments equal to: (1) 104% of Executive’s current Base Salary
for eighteen (18) months, in the aggregate amount of $516,360 (less applicable
withholding taxes); plus (2) additional Bonus payments at the same 150% of
target referenced above for eighteen (18) months, in the aggregate amount of
$744,750 (less applicable withholding taxes). These severance payments will be
made over an eighteen (18) month period beginning six (6) months and a day
following Executive’s termination of employment. On February 7, 2010 (six months
and one day following the effective date of your termination of employment),
Company will pay Executive a lump-sum payment of $420,370 (less applicable
withholding taxes) representing the prior six months of delayed installment
payments, with the balance of the severance payments to be paid in twelve
(12) equal installments of $70,061.67 per month beginning on February 7, 2010;
     4. The continuation of Executive’s medical, dental and vision benefits for
eighteen (18) months from the Termination Date (the Company will pay the same
pro rata portion of Executive’s monthly premium as it pays for Executive as an
active employee);
     5. Key Executive Outplacement Services or a cash payment equal to the
estimated value thereof ($25,000), which services or payment shall be provided
or paid no later than February 7, 2010.
     6. Reimbursement of documented costs of moving Executive’s personal
possessions up to a maximum of $15,000;
     7. Reimbursement of documented legal expenses incurred by Executive in
connection with having this Agreement reviewed by counsel up to maximum of
$10,000;
     8. Executive will be allowed to retain his Company provided cell phone and
laptop computer, after Company-related data is removed from the computer; and
     9. Executive will be provided a letter of reference following the execution
of this Agreement.
     10. Under the terms of Executive’s Time-Vested Non-Qualified Stock Option

 

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Agreement dated December 7, 2006 (the “2006 Option Agreement”), the Executive
would have been entitled to exercise 80% of his time-based options (including
the additional 20% that becomes vested as of the next anniversary of the grant
date after the Termination Date). The Parent Board has decided to provide
Executive with an additional benefit and fully vest the other 20% of his
time-based options under the 2006 Option Agreement so that Executive may
exercise 100% shares subject to this grant. This option will remain exercisable
through the termination date set forth in the 2006 Option Agreement, unless
sooner terminated in connection with the terms of the Option Plan or the 2006
Option Agreement.
     Under the terms of Executive’s Time-Vested Non-Qualified Stock Option
Agreement dated June 28, 2007 (the “2007 Option Agreement”), the Executive would
have been entitled to exercise 60% of his time-based options (including the
additional 20% that becomes vested as of the next anniversary of the grant date
after the Termination Date). The Parent Board has decided to provide Executive
with an additional benefit and fully vest the other 40% of his time-based
options under the 2007 Option Agreement so that Executive may exercise 100%
shares subject to this grant. This option will remain exercisable through the
termination date set forth in the 2007 Option Agreement, unless sooner
terminated in connection with the terms of the Option Plan or the 2007 Option
Agreement.