Document:

Exhibit 10.1

 

 

 

AMERICAN
PUBLIC EDUCATION, INC.

 

2017 OMNIBUS INCENTIVE PLAN 

 

 

 

     

     

    

 

Table of
Contents

 

	 	 	 	 	Page
	 	 	 	 	 
	1.	PURPOSE	1
	 	 	 
	2.	DEFINITIONS	1
	 	 	 
	3.	ADMINISTRATION OF THE PLAN	8
	 	3.1	Committee	 	8
	 	 	3.1.1	Powers and Authorities	8
	 	 	3.1.2	Composition of the Committee	8
	 	 	3.1.3	Other Committees	8
	 	 	3.1.4	Delegation by the Committee.	9
	 	3.2	Board	9
	 	3.3	Terms of Awards	9
	 	 	3.3.1	Committee Authority	9
	 	 	3.3.2	Forfeiture; Recoupment	10
	 	3.4	No Repricing Without Stockholder Approval	10
	 	3.5	Deferral Arrangement	11
	 	3.6	No Liability	11
	 	3.7	Registration; Share Certificates	11
	 	 	 	 
	4.	STOCK SUBJECT TO THE PLAN	11
	 	4.1	Number of Shares of Stock Available for Awards	11
	 	4.2	Adjustments in Authorized Shares of Stock	12
	 	4.3	Share Usage	12
	 	 	 	 
	5.	TERM; AMENDMENT AND TERMINATION	13
	 	5.1	Term	13
	 	5.2	Amendment, Suspension, and Termination	13
	 	 	 	 
	6.	AWARD ELIGIBILITY AND LIMITATIONS	13
	 	6.1	Eligible Grantees	13
	 	6.2	Limitation on Shares of Stock Subject to Awards and Cash Awards	13
	 	6.3	Stand-Alone, Additional, Tandem, and Substitute Awards	14
	 	 	 	 
	7.	AWARD AGREEMENT	14
	 	 	 
	8.	TERMS AND CONDITIONS OF OPTIONS	15
	 	8.1	Option Price	15
	 	8.2	Vesting and Exercisability	15
	 	8.3	Term	15
	 	8.4	Termination of Service	15
	 	8.5	Limitations on Exercise of Option	16
	 	8.6	Method of Exercise	16
	 	8.7	Rights of Holders of Options	16
	 	8.8	Delivery of Stock	16

 

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	 	8.9	Transferability of Options	16
	 	8.10	Family Transfers	16
	 	8.11	Limitations on Incentive Stock Options.	17
	 	8.12	Notice of Disqualifying Disposition.	17
	 	 	 	 
	9.	TERMS AND CONDITIONS OF STOCK APPRECIATION RIGHTS	17
	 	9.1	Right to Payment and SAR Price	17
	 	9.2	Other Terms	18
	 	9.3	Term	18
	 	9.4	Rights of Holders of SARs.	18
	 	9.5	Transferability of SARs	18
	 	9.6	Family Transfers	18
	 	 	 	 
	10.	TERMS AND CONDITIONS OF RESTRICTED STOCK, RESTRICTED STOCK UNITS, AND DEFERRED STOCK UNITS	19
	 	10.1	Grant of Restricted Stock, Restricted Stock Units, and Deferred Stock Units	19
	 	10.2	Restrictions	19
	 	10.3	Registration; Restricted Stock Certificates	19
	 	10.4	Rights of Holders of Restricted Stock	20
	 	10.5	Rights of Holders of Restricted Stock Units and Deferred Stock Units	20
	 	 	10.5.1	Voting and Dividend Rights	20
	 	 	10.5.2	Creditor’s Rights	20
	 	10.6	Termination of Service	20
	 	10.7	Purchase of Restricted Stock	21
	 	10.8	Delivery of Shares of Stock	21
	 	 	 	 
	11.	TERMS AND CONDITIONS OF UNRESTRICTED STOCK AWARDS AND OTHER EQUITY-BASED AWARDS	21
	 	11.1	Unrestricted Stock Awards	21
	 	11.2	Other Equity-Based Awards	21
	 	 	 	 
	12.	TERMS AND CONDITIONS OF DIVIDEND EQUIVALENT RIGHTS	22
	 	12.1	Dividend Equivalent Rights	22
	 	12.2	Termination of Service	22
	 	 	 	 
	13.	TERMS AND CONDITIONS OF PERFORMANCE-BASED AWARDS	22
	 	13.1	Grant of Performance-Based Awards	22
	 	13.2	Value of Performance-Based Awards	22
	 	13.3	Earning of Performance-Based Awards	23
	 	13.4	Form and Timing of Payment of Performance-Based Awards	23
	 	13.5	Performance Conditions	23
	 	13.6	Performance-Based Awards Granted to Designated Covered Employees	23
	 	 	13.6.1	Performance Goals Generally	23
	 	 	13.6.2	Timing For Establishing Performance Goals	24
	 	 	13.6.3	Payment of Awards; Other Terms	24
	 	 	13.6.4	Performance Measures	24
	 	 	13.6.5	Evaluation of Performance	26
	 	 	13.6.6	Adjustment of Performance-Based Compensation	26
	 	 	13.6.7	Committee Discretion	27
	 	 	13.6.8	Status of Awards Under Code Section 162(m)	 

 

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	14.	FORMS OF PAYMENT	27
	 	14.1	General Rule	27
	 	14.2	Surrender of Shares of Stock	27
	 	14.3	Cashless Exercise	27
	 	14.4	Other Forms of Payment	28
	 	 	 	 
	15.	REQUIREMENTS OF LAW	28
	 	15.1	General	28
	 	15.2	Rule 16b-3	28
	 	 	 	 
	16.	EFFECT OF CHANGES IN CAPITALIZATION	29
	 	16.1	Changes in Stock	29
	 	16.2	Reorganization in Which the Company Is the Surviving Entity Which Does not Constitute a Corporate Transaction	29
	 	16.3	Corporate Transaction in which Awards are not Assumed	30
	 	16.4	Corporate Transaction in which Awards are Assumed	31
	 	16.5	Adjustments.	31
	 	16.6	No Limitations on Company	32
	 	 	 	 
	17.	PARACHUTE LIMITATIONS	32
	 	 	 	 
	 	18.	GENERAL PROVISIONS	33
	 	18.1	Disclaimer of Rights	33
	 	18.2	Nonexclusivity of the Plan	33
	 	18.3	Withholding Taxes	33
	 	18.4	Captions	34
	 	18.5	Construction	34
	 	18.6	Other Provisions	34
	 	18.7	Number and Gender	34
	 	18.8	Severability	34
	 	18.9	Governing Law	34
	 	18.10	Section 409A of the Code	35

 

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AMERICAN PUBLIC EDUCATION, INC.

2017 OMNIBUS INCENTIVE PLAN

 

		1.	PURPOSE

 

The Plan is intended
to (a) provide eligible individuals with an incentive to contribute to the success of the Company and to operate and manage
the Company’s business in a manner that will provide for the Company’s long-term growth and profitability and that
will benefit its stockholders and other important stakeholders, including its employees and customers, and (b) provide a means
of recruiting, rewarding, and retaining key personnel. To this end, the Plan provides for the grant of Awards of Options, Stock
Appreciation Rights, Restricted Stock, Restricted Stock Units, Deferred Stock Units, Unrestricted Stock, Dividend Equivalent Rights,
Performance Shares and other Performance-Based Awards, Other Equity-Based Awards, and cash bonus awards. Any of these Awards may,
but need not, be made as performance incentives to reward the holders of such Awards for the achievement of performance goals in
accordance with the terms of the Plan. Options granted under the Plan may be Nonqualified Stock Options or Incentive Stock Options,
as provided herein.

 

		2.	DEFINITIONS

 

For purposes of
interpreting the Plan documents, including the Plan and Award Agreements, the following capitalized terms shall have the meanings
specified below, unless the context clearly indicates otherwise:

 

2.1           “Affiliate”
shall mean any Person that controls, is controlled by, or is under common control with the Company within the meaning of Rule 405
of Regulation C under the Securities Act, including any Subsidiary. For purposes of grants of Options or Stock Appreciation Rights,
an entity may not be considered an Affiliate unless the Company holds a Controlling Interest in such entity.

 

2.2           “Applicable
Laws” shall mean the legal requirements relating to the Plan and the Awards under (a) applicable provisions of the
Code, the Securities Act, the Exchange Act, any rules or regulations thereunder, and any other laws, rules, regulations, and government
orders of any jurisdiction applicable to the Company or its Affiliates, (b) applicable provisions of the corporate, securities,
tax, and other laws, rules, regulations, and government orders of any jurisdiction applicable to Awards granted to residents thereof,
and (c) the rules of any Stock Exchange or Securities Market on which the Stock is listed or publicly traded.

 

2.3           “Award”
shall mean a grant under the Plan of an Option, a Stock Appreciation Right, Restricted Stock, a Restricted Stock Unit, a Deferred
Stock Unit, Unrestricted Stock, a Dividend Equivalent Right, a Performance Share or other Performance-Based Award, an Other Equity-Based
Award, or cash.

 

2.4           “Award
Agreement” shall mean the written agreement, in such written, electronic, or other form as determined by the Committee,
between the Company and a Grantee that evidences and sets forth the terms and conditions of an Award.

 

2.5           “Benefit
Arrangement” shall mean any formal or informal plan or other arrangement for the direct or indirect provision of compensation
to a Grantee (including groups or classes of Grantees or beneficiaries of which the Grantee is a member), whether or not such compensation
is deferred, is in cash, or is in the form of a benefit to or for the Grantee.

 

     

     

    

 

2.6           “Board”
shall mean the Board of Directors of the Company.

 

2.7           “Cause”
shall have the meaning set forth in an applicable agreement between a Grantee and the Company or an Affiliate, and in the absence
of any such agreement, shall mean, with respect to any Grantee and as determined by the Committee, (a) gross negligence or
willful misconduct in connection with the performance of duties; (b) conviction of, or pleading guilty or nolo contendere
to, a criminal offense (other than minor traffic offenses); or (c) material breach of any term of any employment, consulting
or other services, confidentiality, intellectual property, or non-competition agreements, if any, between such Grantee and the
Company or an Affiliate. Any determination by the Committee regarding whether an event constituting Cause shall have occurred shall
be final, binding, and conclusive.

 

2.8           “Capital
Stock” shall mean, with respect to any Person, any and all shares, interests, participations, or other equivalents (however
designated, whether voting or non-voting) in equity of such Person, whether outstanding on the Effective Date or issued thereafter,
including, without limitation, all shares of Stock.

 

2.9           “Code”
shall mean the Internal Revenue Code of 1986, as amended, as now in effect or as hereafter amended, and any successor thereto.
References in the Plan to any Code Section shall be deemed to include, as applicable, regulations and guidance promulgated under
such Code Section.

 

2.10         “Committee”
shall mean a committee of, and designated from time to time by resolution of, the Board, which shall be constituted as provided
in Section 3.1.2 and Section 3.1.3 (or, if no Committee has been so designated, the Board).

 

2.11         “Company”
shall mean American Public Education, Inc., a Delaware corporation, and any successor thereto.

 

2.12         “Controlling
Interest” shall have the meaning set forth in Treasury Regulation Section 1.414(c)-2(b)(2)(i); provided that (a) except
as specified in clause (b) below, an interest of “at least 50 percent” shall be used instead of an interest of “at
least 80 percent” in each case where “at least 80 percent” appears in Treasury Regulation Section 1.414(c)-2(b)(2)(i),
and (b) where a grant of Options or Stock Appreciation Rights is based upon a legitimate business criterion, an interest of “at
least 20 percent” shall be used instead of an interest of “at least 80 percent” in each case where “at
least 80 percent” appears in Treasury Regulation Section 1.414(c)-2(b)(2)(i).

 

2.13         “Corporate
Transaction” shall mean, subject to Section 18.10, the occurrence of any of the following:

 

(a)          the
dissolution or liquidation of the Company or a merger, consolidation, or reorganization of the Company with one or more other entities
in which the Company is not the surviving entity;

 

(b)          a
sale of substantially all of the assets of the Company to another Person; or

 

(c)          any
transaction (including without limitation a merger or reorganization in which the Company is the surviving entity) which results
in any Person owning 50% or more of the combined voting power of all classes of Capital Stock of the Company.

 

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The Board shall
have full and final authority, in its sole discretion, to determine conclusively whether a Corporate Transaction has occurred pursuant
to the above definition, the date of the occurrence of such Corporate Transaction, and any incidental matters relating thereto.

 

2.14         “Covered
Employee” shall mean a Grantee who is, or could become, a “covered employee” within the meaning of Code Section 162(m)(3).

 

2.15         “Deferred
Stock Unit” shall mean a Restricted Stock Unit, the terms of which provide for delivery of the underlying shares of Stock,
cash, or a combination thereof subsequent to the date of vesting, at a time or times consistent with the requirements of Code Section
409A.

 

2.16         “Disability”
shall mean the inability of a Grantee to perform each of the essential duties of such Grantee’s position by reason of a medically
determinable physical or mental impairment which is potentially permanent in character or which can be expected to last for a continuous
period of not less than twelve (12) months; provided that, with respect to rules regarding the expiration of an Incentive Stock
Option following termination of a Grantee’s Service, Disability shall mean the inability of such Grantee to engage in any
substantial gainful activity by reason of a medically determinable physical or mental impairment which can be expected to result
in death or which has lasted or can be expected to last for a continuous period of not less than twelve (12) months.

 

2.17         “Disqualified
Individual” shall have the meaning set forth in Code Section 280G(c).

 

2.18         “Dividend
Equivalent Right” shall mean a right, granted to a Grantee pursuant to Article 12, entitling the Grantee
thereof to receive, or to receive credits for the future payment of, cash, Stock, other Awards, or other property equal in value
to dividend payments or distributions, or other periodic payments, declared or paid with respect to a number of shares of Stock
specified in such Dividend Equivalent Right (or other Award to which such Dividend Equivalent Right relates) as if such shares
of Stock had been issued to and held by the Grantee of such Dividend Equivalent Right as of the record date.

 

2.19         “Effective
Date” shall mean May 12, 2017, subject to approval of the Plan by the Company’s stockholders on such date, the
Plan having been approved by the Board on March 31, 2017.

 

2.20         “Employee”
shall mean, as of any date of determination, an employee (including an officer) of the Company or an Affiliate.

 

2.21         “Exchange
Act” shall mean the Securities Exchange Act of 1934, as amended, as now in effect or as hereafter amended, and any successor
thereto.

 

2.22         “Fair
Market Value” shall mean the fair market value of a share of Stock for purposes of the Plan, which shall be, as of any
date of determination:

 

(a)          If
on such date the shares of Stock are listed on a Stock Exchange, or are publicly traded on another Securities Market, the Fair
Market Value of a share of Stock shall be the closing price of the Stock as reported on such Stock Exchange or such Securities
Market (provided that, if there is more than one such Stock Exchange or Securities Market, the Committee shall designate the appropriate
Stock Exchange or Securities Market for purposes of the Fair Market Value determination). If there is no such reported closing
price on such date, the Fair Market Value of a share of Stock shall be the closing price of the Stock on the next preceding day
on which any sale of Stock shall have been reported on such Stock Exchange or such Securities Market.

 

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(b)          If
on such date the shares of Stock are not listed on a Stock Exchange or publicly traded on a Securities Market, the Fair Market
Value of a share of Stock shall be the value of the Stock as determined by the Committee by the reasonable application of a reasonable
valuation method, in a manner consistent with Code Section 409A.

 

Notwithstanding
this Section 2.22 or Section 18.3, for purposes of determining taxable income and the amount of the related
tax withholding obligation pursuant to Section 18.3, the Fair Market Value will be determined by the Committee in good
faith using any reasonable method as it deems appropriate, to be applied consistently with respect to Grantees; provided, further,
that the Committee shall determine the Fair Market Value of shares of Stock for tax withholding obligations due in connection with
sales, by or on behalf of a Grantee, of such shares of Stock subject to an Award to pay the Option Price, SAR Price, and/or any
tax withholding obligation on the same date on which such shares may first be sold pursuant to the terms of the applicable Award
Agreement (including broker-assisted cashless exercises of Options and Stock Appreciation Rights, as described in Section 14.3,
and sell-to-cover transactions) in any manner consistent with applicable provisions of the Code, including but not limited
to using the sale price of such shares on such date (or if sales of such shares are effectuated at more than one sale price, the
weighted average sale price of such shares on such date) as the Fair Market Value of such shares, so long as such Grantee has provided
the Company, or its designee or agent, with advance written notice of such sale.

 

2.23         “Family
Member” shall mean, with respect to any Grantee as of any date of determination, (a) a Person who is a spouse, former
spouse, child, stepchild, grandchild, parent, stepparent, grandparent, niece, nephew, mother-in-law, father-in-law, son-in-law,
daughter-in-law, brother, sister, brother-in-law, or sister-in-law, including adoptive relationships, of such Grantee, (b) any
Person sharing such Grantee’s household (other than a tenant or employee), (c) a trust in which any one or more of the
Persons specified in clauses (a) and (b) above (and such Grantee) own more than fifty percent (50%) of the beneficial
interest, (d) a foundation in which any one or more of the Persons specified in clauses (a) and (b) above (and such
Grantee) control the management of assets, and (e) any other entity in which one or more of the Persons specified in clauses
(a) and (b) above (and such Grantee) own more than fifty percent (50%) of the voting interests.

 

2.24         “Grant
Date” shall mean, as determined by the Committee, the latest to occur of (a) the date as of which the Committee
approves the Award, (b) the date on which the recipient of an Award first becomes eligible to receive an Award under Article
6 hereof (e.g., in the case of a new hire, the first date on which such new hire performs any Service), or (c) such subsequent
date specified by the Committee in the corporate action approving the Award.

 

2.25         “Grantee”
shall mean a Person who receives or holds an Award under the Plan.

 

2.26         “Incentive
Stock Option” shall mean an “incentive stock option” within the meaning of Code Section 422.

 

2.27         “Nonqualified
Stock Option” shall mean an Option that is not an Incentive Stock Option.

 

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2.28         “Non-Employee
Director” shall have the meaning set forth in Rule 16b-3 under the Exchange Act; provided, however, for purposes of Section
6.2(d), Non-Employee Director shall mean a director of the Company who is not an employee of the Company or an Affiliate.

 

2.29         “Officer”
shall have the meaning set forth in Rule 16a-1(f) under the Exchange Act.

 

		2.30	“Option” shall mean an option to
purchase one or more shares of Stock at a specified Option Price awarded to a Grantee pursuant to Article 8.

 

2.31         “Option
Price” shall mean the per share exercise price for shares of Stock subject to an Option.

 

2.32         “Other
Agreement” shall mean any agreement, contract, or understanding heretofore or hereafter entered into by a Grantee with
the Company or an Affiliate, except an agreement, contract, or understanding that expressly addresses Code Section 280G and/or
Code Section 4999.

 

2.33         “Other
Equity-Based Award” shall mean an Award representing a right or other interest that may be denominated or payable in,
valued in whole or in part by reference to, or otherwise based on or related to Stock, other than an Option, a Stock Appreciation
Right, Restricted Stock, a Restricted Stock Unit, a Deferred Stock Unit, Unrestricted Stock, a Dividend Equivalent Right, or a
Performance Share or other Performance-Based Award.

 

2.34         “Outside
Director” shall have the meaning set forth in Code Section 162(m)(4)(C)(i).

 

2.35         “Parachute
Payment” shall mean a “parachute payment” within the meaning of Code Section 280G(b)(2).

 

2.36         “Performance-Based
Award” shall mean an Award of Options, Stock Appreciation Rights, Restricted Stock, Restricted Stock Units, Deferred
Stock Units, Performance Shares, Other Equity-Based Awards, or cash made subject to the achievement of performance goals (as provided
in Article 13) over a Performance Period specified by the Committee.

 

2.37         “Performance-Based
Compensation” shall mean compensation under an Award that is intended to satisfy the requirements of Code Section 162(m)
for Qualified Performance-Based Compensation paid to Covered Employees. Notwithstanding the foregoing, nothing in the Plan shall
be construed to mean that an Award which does not satisfy the requirements for Qualified Performance-Based Compensation does not
constitute performance-based compensation for other purposes, including the purposes of Code Section 409A.

 

2.38         “Performance
Measures” shall mean measures as specified in Section 13.6.4 on which the performance goal or goals under
Performance-Based Awards are based and which are approved by the Company’s stockholders pursuant to, and to the extent required
by, the Plan in order to qualify such Performance-Based Awards as Performance-Based Compensation.

 

2.39         “Performance
Period” shall mean the period of time, up to ten (10) years, during or over which the performance goals under Performance-Based
Awards must be met in order to determine the degree of payout and/or vesting with respect to any such Performance-Based Awards.

 

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2.40         “Performance
Shares” shall mean a Performance-Based Award representing a right or other interest that may be denominated or payable
in, valued in whole or in part by reference to, or otherwise based on or related to Stock, made subject to the achievement of performance
goals (as provided in Article 13) over a Performance Period of up to ten (10) years.

 

2.41         “Person”
shall mean an individual, a corporation, a partnership, a limited liability company, an association, a trust, or any other entity
or organization, including a government or political subdivision or an agency or instrumentality thereof; provided that, for purposes
of Section 2.13, Person shall have the meaning set forth in Sections 13(d) and 14(d)(2) of the Exchange Act.

 

2.42         “Plan”
shall mean this American Public Education, Inc. 2017 Omnibus Incentive Plan, as amended from time to time.

 

2.43         “Prior
Plans” shall mean the American Public Education, Inc. 2011 Omnibus Incentive Plan, the American Public Education, Inc.
2007 Omnibus Incentive Plan, and the American Public Education, Inc. 2002 Stock Incentive Plan.

 

2.44         “Qualified
Performance-Based Compensation” shall have the meaning set forth in Code Section 162(m).

 

2.45         “Restricted
Period” shall mean a period of time established by the Committee during which an Award of Restricted Stock, Restricted
Stock Units, or Deferred Stock Units is subject to restrictions.

 

2.46         “Restricted
Stock” shall mean shares of Stock awarded to a Grantee pursuant to Article 10.

 

2.47         “Restricted
Stock Unit” shall mean a bookkeeping entry representing the equivalent of one (1) share of Stock awarded to a Grantee
pursuant to Article 10 that may be settled, subject to the terms and conditions of the applicable Award Agreement, in shares
of Stock, cash, or a combination thereof.

 

2.48         “SAR
Price” shall mean the per share exercise price of a SAR.

 

2.49         “Securities
Act” shall mean the Securities Act of 1933, as amended, as now in effect or as hereafter amended, and any successor thereto.

 

2.50         “Securities
Market” shall mean an established securities market.

 

2.51         “Separation
from Service” shall have the meaning set forth in Code Section 409A.

 

2.52         “Service”
shall mean service qualifying a Grantee as a Service Provider to the Company or an Affiliate. Unless otherwise provided in the
applicable Award Agreement, a Grantee’s change in position or duties shall not result in interrupted or terminated Service,
so long as such Grantee continues to be a Service Provider to the Company or an Affiliate. Subject to the preceding sentence, any
determination by the Committee whether a termination of Service shall have occurred for purposes of the Plan shall be final, binding,
and conclusive. If a Service Provider’s employment or other Service relationship is with an Affiliate and the applicable
entity ceases to be an Affiliate, a termination of Service shall be deemed to have occurred when such entity ceases to be an Affiliate
unless the Service Provider transfers his or her employment or other Service relationship to the Company or any other Affiliate.

 

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2.53         “Service
Provider” shall mean (a) an Employee or director of the Company or an Affiliate, or (b) a consultant or adviser to the
Company or an Affiliate (i) who is a natural person, (ii) who is currently providing bona fide services to the Company or an Affiliate,
and (iii) whose services are not in connection with the Company’s sale of securities in a capital-raising transaction and
do not directly or indirectly promote or maintain a market for the Company’s Capital Stock.

 

2.54         “Service
Recipient Stock” shall have the meaning set forth in Code Section 409A.

 

2.55         “Share
Limit” shall have the meaning set forth in Section 4.1.

 

2.56         “Short-Term
Deferral Period” shall have the meaning set forth in Code Section 409A.

 

2.57         “Stock”
shall mean common stock, par value $0.01 per share, of the Company, or any security into which shares of Stock may be changed or
for which shares of Stock may be exchanged as provided in Section 16.1.

 

2.58         “Stock
Appreciation Right” or “SAR” shall mean a right granted to a Grantee pursuant to Article 9.

 

2.59         “Stock
Exchange” shall mean the New York Stock Exchange, the NASDAQ Capital Market, the NASDAQ Global Market, the NASDAQ Global
Select Market, or another established national or regional stock exchange.

 

2.60         “Subsidiary”
shall mean any corporation (other than the Company) or non-corporate entity with respect to which the Company owns, directly or
indirectly, fifty percent (50%) or more of the total combined voting power of all classes of stock, membership interests or
other ownership interests of any class or kind ordinarily having the power to vote for the directors, managers, or other voting
members of the governing body of such corporation or non-corporate entity; provided however, for purposes of Incentive Stock Options,
Subsidiary means any “subsidiary corporation” of the Company within the meaning of Code Section 424(f). In addition,
any other entity may be designated by the Committee as a Subsidiary, provided that (a) such entity could be considered as
a subsidiary according to generally accepted accounting principles in the United States of America and (b) in the case of
an Award of Options or Stock Appreciation Rights, such Award would be considered to be granted in respect of Service Recipient
Stock under Code Section 409A.

 

2.61         “Substitute
Award” shall mean an Award granted upon assumption of, or in substitution for, outstanding awards previously granted
under a compensatory plan of the Company, an Affiliate, or a business entity acquired or to be acquired by the Company or an Affiliate
or with which the Company or an Affiliate has combined or will combine.

 

2.62         “Ten
Percent Stockholder” shall mean a natural Person who owns more than ten percent (10%) of the total combined voting
power of all classes of voting Capital Stock of the Company, the Company’s parent (if any), or any of the Company’s
Subsidiaries. In determining stock ownership, the attribution rules of Code Section 424(d) shall be applied.

 

2.63         “Unrestricted
Stock” shall mean Stock that is free of any restrictions.

 

2.64         “2011
Plan” shall mean the American Public Education, Inc. 2011 Omnibus Incentive Plan.

 

    	 	7	 

     

    

 

		3.	ADMINISTRATION OF THE PLAN

 

		3.1	Committee.

 

		3.1.1	Powers and Authorities.

 

The Committee shall
administer the Plan and shall have such powers and authorities related to the administration of the Plan as are consistent with
the Company’s certificate of incorporation and bylaws and Applicable Laws. Without limiting the generality of the foregoing,
the Committee shall have full power and authority to take all actions and to make all determinations required or provided for under
the Plan, any Award, or any Award Agreement and shall have full power and authority to take all such other actions and to make
all such other determinations not inconsistent with the specific terms and provisions of the Plan which the Committee deems to
be necessary or appropriate to the administration of the Plan, any Award, or any Award Agreement. All such actions and determinations
shall be made by (a) the affirmative vote of a majority of the members of the Committee present at a meeting at which a quorum
is present, or (b) the unanimous consent of the members of the Committee executed in writing or evidenced by electronic transmission
in accordance with the Company’s certificate of incorporation and bylaws and Applicable Laws. Unless otherwise expressly
determined by the Board, the Committee shall have the authority to interpret and construe all provisions of the Plan, any Award,
and any Award Agreement, and any such interpretation or construction, and any other determination contemplated to be made under
the Plan or any Award Agreement, by the Committee shall be final, binding, and conclusive on all Persons, whether or not expressly
provided for in any provision of the Plan, such Award, or such Award Agreement.

 

In the event that
the Plan, any Award, or any Award Agreement provides for any action to be taken by the Board or any determination to be made by
the Board, such action may be taken or such determination may be made by the Committee constituted in accordance with this Section 3.1
if the Board has delegated the power and authority to do so to such Committee.

 

		3.1.2	Composition of
                                         the Committee.

 

The Committee shall
be a committee composed of not fewer than two (2) directors of the Company designated by the Board to administer the Plan. Each
member of the Committee shall be (a) a Non-Employee Director, (b) an Outside Director, and (c) an independent director in accordance
with the rules of any Stock Exchange on which the Stock is listed; provided that any action taken by the Committee shall be valid
and effective whether or not members of the Committee at the time of such action are later determined not to have satisfied the
requirements for membership set forth in this Section 3.1.2 or otherwise provided in any charter of the Committee.
Without limiting the generality of the foregoing, the Committee may be the Compensation Committee of the Board or a subcommittee
thereof if the Compensation Committee of the Board or such subcommittee satisfies the foregoing requirements.

 

		3.1.3	Other Committees.

 

The Board also may
appoint one or more committees of the Board, each composed of one or more directors of the Company who need not be Outside Directors,
which (a) may administer the Plan with respect to Grantees who are not Officers or directors of the Company, (b) may grant Awards
under the Plan to such Grantees, and (c) may determine all terms of such Awards, in each case, excluding (for the avoidance of
doubt) Performance-Based Awards intending to constitute Qualified Performance-Based Compensation and subject, if applicable, to
the requirements of Rule 16b-3 under the Exchange Act and the rules of any Stock Exchange or Securities Market on which the Stock
is listed or publicly traded.

 

    	 	8	 

     

    

 

		3.1.4	Delegation by the Committee.

 

To the extent permitted
by Applicable Laws, the Committee may, by resolution, delegate some or all of its authority with respect to the Plan and Awards
to the President and Chief Executive Officer of the Company and/or any other officer of the Company designated by the Committee,
provided that the Committee may not delegate its authority hereunder (a) to make Awards to directors of the Company, (b) to make
Awards to Employees who are (i) Officers, (ii) Covered Employees, or (iii) officers of the Company who are delegated authority
by the Committee pursuant to this Section 3.1.4, or (c) to interpret the Plan, any Award, or any Award Agreement. Any delegation
hereunder will be subject to the restrictions and limits that the Committee specifies at the time of such delegation or thereafter.
Nothing in the Plan will be construed as obligating the Committee to delegate authority to any officer of the Company, and the
Committee may at any time rescind the authority delegated to an officer of the Company appointed hereunder and delegate authority
to one or more other officers of the Company. At all times, an officer of the Company delegated authority pursuant to this Section
3.1.4 will serve in such capacity at the pleasure of the Committee. Any action undertaken by any such officer of the Company
in accordance with the Committee’s delegation of authority will have the same force and effect as if undertaken directly
by the Committee, and any reference in the Plan to the “Committee” will, to the extent consistent with the terms and
limitations of such delegation, be deemed to include a reference to each such officer.

 

		3.2	Board.

 

The Board, from
time to time, may exercise any or all of the powers and authorities related to the administration and implementation of the Plan,
as set forth in Section 3.1 and other applicable provisions of the Plan, as the Board shall determine, consistent with
the Company’s certificate of incorporation and bylaws and Applicable Laws.

 

		3.3	Terms of Awards.

 

		3.3.1	Committee Authority.

 

Subject to the other
terms and conditions of the Plan, the Committee shall have full and final authority to:

 

(a)          designate
Grantees;

 

(b)          determine
the type or types of Awards to be made to a Grantee;

 

(c)          determine
the number of shares of Stock to be subject to an Award or to which an Award relates;

 

(d)          establish
the terms and conditions of each Award (including the Option Price, the SAR Price, and the purchase price for applicable Awards;
the nature and duration of any restriction or condition (or provision for lapse thereof) relating to the vesting, exercise, transfer,
or forfeiture of an Award or the shares of Stock subject thereto; the treatment of an Award in the event of a Corporate Transaction
(subject to applicable agreements); and any terms or conditions that may be necessary to qualify Options as Incentive Stock Options);

 

    	 	9	 

     

    

 

(e)          prescribe
the form of each Award Agreement evidencing an Award;

 

(f)          subject
to the limitation on repricing in Section 3.4, amend, modify, or supplement the terms of any outstanding Award, which
authority shall include the authority, in order to effectuate the purposes of the Plan but without amending the Plan, to make Awards
or to modify outstanding Awards made to eligible natural Persons who are foreign nationals or are natural Persons who are employed
outside the United States to reflect differences in local law, tax policy, or custom; provided that, notwithstanding the foregoing,
no amendment, modification, or supplement of the terms of any outstanding Award shall, without the consent of the Grantee thereof,
impair such Grantee’s rights under such Award; and

 

(g)          make
Substitute Awards.

 

		3.3.2	Forfeiture; Recoupment.

 

(a)          The
Committee may reserve the right in an Award Agreement to cause a forfeiture of the gain realized by a Grantee with respect to an
Award thereunder on account of actions taken by, or failed to be taken by, such Grantee in violation or breach of, or in conflict
with, any (a) employment agreement, (b) non-competition agreement, (c) agreement prohibiting solicitation of Employees
or clients of the Company or an Affiliate, (d) confidentiality obligation with respect to the Company or an Affiliate, (e) Company
or Affiliate policy or procedure, (f) other agreement, or (g) other obligation of such Grantee to the Company or an Affiliate,
as and to the extent specified in such Award Agreement. If the Grantee of an outstanding Award is an Employee of the Company or
an Affiliate and such Grantee’s Service is terminated for Cause, the Committee may annul such Grantee’s outstanding
Award as of the date of the Grantee’s termination of Service for Cause.

 

(b)          Any
Award granted pursuant to the Plan shall be subject to mandatory repayment by the Grantee to the Company (x) to the extent set
forth in this Plan or an Award Agreement or (y) to the extent the Grantee is, or in the future becomes, subject to (1) any
Company or Affiliate “clawback” or recoupment policy that is adopted to comply with the requirements of any Applicable
Laws, or (2) any Applicable Laws which impose mandatory recoupment, under circumstances set forth in such Applicable Laws.

 

		3.4	No Repricing Without Stockholder Approval.

 

Except in connection
with a corporate transaction involving the Company (including, without limitation, any stock dividend, distribution (whether in
the form of cash, shares of Stock, other securities, or other property), stock split, extraordinary dividend, recapitalization,
Corporate Transaction, reorganization, merger, consolidation, split-up, spin-off, combination, repurchase or exchange of shares
of Stock, or other securities or similar transaction), the Company may not: (a) amend the terms of outstanding Options or
SARs to reduce the Option Price or SAR Price, as applicable, of such outstanding Options or SARs; (b) cancel or assume outstanding
Options or SARs in exchange for or substitution of Options or SARs with an Option Price or SAR Price, as applicable, that is less
than the Option Price or SAR Price, as applicable, of the original Options or SARs; or (c) cancel or assume outstanding Options
or SARs with an Option Price or SAR Price, as applicable, above the current Fair Market Value in exchange for cash, Awards, or
other securities, in each case, unless such action (i) is subject to and approved by the Company’s stockholders or (ii) would
not be deemed to be a repricing under the rules of any Stock Exchange or Securities Market on which the Stock is listed or publicly
traded.

 

    	 	10	 

     

    

 

		3.5	Deferral Arrangement.

 

The Committee may
permit or require the deferral of any payment pursuant to any Award into a deferred compensation arrangement, subject to such rules
and procedures as it may establish, which may include provisions for the payment or crediting of interest or Dividend Equivalent
Rights and, in connection therewith, provisions for converting such credits into Deferred Stock Units and for restricting deferrals
to comply with hardship distribution rules affecting tax-qualified retirement plans subject to Code Section 401(k)(2)(B)(IV);
provided that no Dividend Equivalent Rights may be granted in connection with, or related to, an Award of Options or SARs.
Any such deferrals shall be made in a manner that complies with Code Section 409A, including, if applicable, with respect
to when a Separation from Service occurs.

 

		3.6	No Liability.

 

No member of the
Board or the Committee shall be liable for any action or determination made in good faith with respect to the Plan, any Award,
or any Award Agreement. Notwithstanding any provision of the Plan to the contrary, neither the Company, an Affiliate, the Board,
the Committee, nor any person acting on behalf of the Company, an Affiliate, the Board, or the Committee will be liable to any
Grantee or to the estate or beneficiary of any Grantee or to any other holder of an Award under the Plan by reason of any acceleration
of income, or any additional tax (including any interest and penalties), asserted by reason of the failure of an Award to satisfy
the requirements of Code Section 422 or Code Section 409A or by reason of Code Section 4999, or otherwise asserted with respect
to the Award; provided, that this Section 3.6 shall not affect any of the rights or obligations set forth in an applicable
agreement between the Grantee and the Company or an Affiliate.

 

		3.7	Registration; Share Certificates.

 

Notwithstanding
any provision of the Plan to the contrary, the ownership of the shares of Stock issued under the Plan may be evidenced in such
a manner as the Committee, in its sole discretion, deems appropriate, including by book-entry or direct registration (including
transaction advices) or the issuance of one or more share certificates.

 

		4.	STOCK SUBJECT TO THE PLAN

 

		4.1	Number of Shares of Stock Available for Awards.

 

Subject to such
additional shares of Stock as shall be available for issuance under the Plan pursuant to Section 4.2, and subject to adjustment
pursuant to Article 16, the maximum number of shares of Stock reserved for issuance under the Plan shall be equal to the
sum of (i) one million six hundred seventy-five thousand (1,675,000) shares of Stock, plus (ii) the number of shares of Stock available
for future awards under the 2011 Plan as of the Effective Date, less the actual number of shares of Stock issued, if any, in excess
of the target number of shares of Stock upon settlement of the outstanding performance-based deferred stock units under the 2011
Plan, plus (iii) the number of shares of Stock related to awards outstanding under the Prior Plans as of the Effective Date that
thereafter terminate by expiration or forfeiture, cancellation, or otherwise without the issuance of such shares of Stock (the
“Share Limit”). Such shares of Stock may be authorized and unissued shares of Stock, treasury shares of Stock,
or any combination of the foregoing, as may be determined from time to time by the Board or by the Committee. Any of the shares
of Stock reserved and available for issuance under the Plan may be used for any type of Award under the Plan, and any or all of
the shares of Stock reserved for issuance under the Plan shall be available for issuance pursuant to Incentive Stock Options.

 

    	 	11	 

     

    

 

		4.2	Adjustments in Authorized Shares of Stock.

 

In connection with
mergers, reorganizations, separations, or other transactions to which Code Section 424(a) applies, the Committee shall have
the right to cause the Company to assume awards previously granted under a compensatory plan of another business entity that is
a party to such transaction and to grant Substitute Awards under the Plan for such awards. The Share Limit pursuant to Section 4.1
may be increased by the number of shares of Stock subject to any such assumed awards and Substitute Awards. Shares available for
issuance under a stockholder-approved plan of a business entity that is a party to such transaction (as appropriately adjusted,
if necessary, to reflect such transaction) may be used for Awards under the Plan and shall not reduce the number of shares of Stock
otherwise available for issuance under the Plan, subject to applicable rules of any Stock Exchange or Securities Market on which
the Stock is listed or publicly traded.

 

		4.3	Share Usage.

 

(a)          Shares
of Stock covered by an Award shall be counted as used as of the Grant Date for purposes of calculating the number of shares of
Stock available for issuance under Section 4.1.

 

(b)          Any
shares of Stock that are subject to Awards other than Options and SARs, including shares of Stock acquired through dividend reinvestment
pursuant to Article 10, will be counted against the Share Limit as 1.69 shares of Stock for every one (1) share of Stock
subject to the Award; provided, for Performance Shares, the number of shares of Stock subject to such Award will be at least equal
to the target number of shares issuable under the Performance Shares as of the Grant Date, but such number shall be adjusted to
equal the actual number of shares issued upon settlement of the Performance Shares to the extent different from such number of
shares. Any shares of Stock that are subject to Awards of Options and SARs will be counted against the Share Limit as one
(1) share of Stock for every one (1) share of Stock subject to the Award; provided, the number of shares of Stock subject to an
Award of SARs will be counted against the Share Limit as one (1) share of Stock for every one (1) share of Stock subject to such
Award regardless of the number of shares of Stock actually issued to settle such SARs upon the exercise of the SARs.

 

(c)          If
any shares of Stock covered by an Award under the Plan or any award outstanding under the Prior Plans as of the Effective Date
are not purchased or are forfeited or expire or otherwise terminates without delivery of any Stock subject thereto or is settled
in cash in lieu of shares, then the number of shares of Stock with respect to such Award or award shall, to the extent of any such
forfeiture, termination, expiration, or settlement, again be available for making Awards under the Plan; provided that any
shares of Stock subject to an award granted under the Prior Plans shall be available for issuance under the Plan in the same amount
as such shares were counted against the share limits set forth in the applicable Prior Plan.

 

(d)          The
number of shares of Stock available for issuance under the Plan will not be increased by the number of shares of Stock (i) tendered,
withheld, or subject to an Award granted under the Plan surrendered in connection with the purchase of shares of Stock upon exercise
of an Option, (ii) that were not issued upon the net settlement or net exercise of a Stock-settled SAR granted under the Plan,
(iii) deducted or delivered from payment of an Award granted under the Plan in connection with the Company’s tax withholding
obligations as provided in Section 18.3, or (iv) purchased by the Company with proceeds from Option exercises.

 

    	 	12	 

     

    

 

		5.	TERM; AMENDMENT AND TERMINATION

 

		5.1	Term.

 

The Plan shall become
effective as of the Effective Date. Following the Effective Date, no awards shall be made under the Prior Plans. Notwithstanding
the foregoing, shares of Stock reserved under the Prior Plans to settle awards, including performance-based awards, which are made
under the Prior Plans prior to the Effective Date may be issued and delivered following the Effective Date to settle such awards.
The Plan shall terminate on the first to occur of (a) the day before the tenth (10th) anniversary of the Effective Date, (b)
the date determined in accordance with Section 5.2, and (c) the date determined in accordance with Section 16.3;
provided, however, that Incentive Stock Options may not be granted under the Plan after the tenth (10th) anniversary of the date
of the Board’s adoption of the Plan. Upon such termination of the Plan, all outstanding Awards shall continue to have full
force and effect in accordance with the provisions of the terminated Plan and the applicable Award Agreement (or other documents
evidencing such Awards).

 

		5.2	Amendment, Suspension, and Termination.

 

The Board may, at
any time and from time to time, amend, suspend, or terminate the Plan; provided that, with respect to Awards theretofore granted
under the Plan, no amendment, suspension, or termination of the Plan shall, without the consent of the Grantee, impair the rights
or obligations under any such Award. The effectiveness of any amendment to the Plan shall be contingent on approval of such amendment
by the Company’s stockholders to the extent provided by the Board or required by Applicable Laws; provided that no amendment
shall be made to the no-repricing provisions of Section 3.4, the Option pricing provisions of Section 8.1,
or the SAR pricing provisions of Section 9.1 without the approval of the Company’s stockholders.

 

		6.	AWARD ELIGIBILITY AND LIMITATIONS

 

		6.1	Eligible Grantees.

 

Subject to this
Article 6, Awards may be made under the Plan to any Service Provider, as the Committee shall determine and designate
from time to time.

 

		6.2	Limitation on Shares of Stock Subject to Awards and
Cash Awards.

 

During any time
when the Company has any class of common equity securities registered under Section 12 of the Exchange Act, but subject to adjustment
as provided in Article 16:

 

(a)          The
maximum number of shares of Stock that may be granted under the Plan, pursuant to Options or SARs, in a calendar year to any Person
eligible for an Award under Section 6.1, other than a Non-Employee Director of the Company, is two hundred seventy-five
thousand (275,000) shares.

 

(b)          The
maximum number of shares of Stock that may be granted under the Plan, pursuant to Awards other than Options or SARs that are Stock-denominated
and are either Stock- or cash-settled, in a calendar year to any Person eligible for an Award under Section 6.1, other than
a Non-Employee Director of the Company, is two hundred seventy-five thousand (275,000) shares.

 

    	 	13	 

     

    

 

(c)          The
maximum amount that may be paid as a cash-denominated Performance-Based Award (whether or not cash-settled) for a Performance Period
of twelve (12) months or less to any Person eligible for an Award under Section 6.1 shall be two million dollars
($2,000,000), and the maximum amount that may be paid as a cash-denominated Performance-Based Award (whether or not cash-settled)
for a Performance Period of greater than twelve (12) months to any Person eligible for an Award under Section 6.1
shall be three million dollars ($3,000,000).

 

(d)          The
maximum total compensation (including cash payments and the aggregate Grant Date Fair Market Value of shares of Stock that may
be granted under the Plan) that may be paid to or granted in a calendar year to a Non-Employee Director of the Company is five
hundred thousand dollars ($500,000); provided, however, that the foregoing limitation shall not apply to the extent that a Non-Employee
Director has been or becomes an employee of the Company during the calendar year.

 

		6.3	Stand-Alone, Additional, Tandem, and Substitute Awards.

 

Subject to Section 3.4,
Awards granted under the Plan may, in the discretion of the Committee, be granted either alone or in addition to, in tandem with,
or in substitution or exchange for, (a) any other Award, (b) any award granted under another plan of the Company, an
Affiliate, or any business entity that has been a party to a transaction with the Company or an Affiliate, or (c) any other
right of a Grantee to receive payment from the Company or an Affiliate. Such additional, tandem, exchange, or Substitute Awards
may be granted at any time. If an Award is granted in substitution or exchange for another Award, or for an award granted under
another plan of the Company, an Affiliate, or any business entity that has been a party to a transaction with the Company or an
Affiliate, the Committee shall require the surrender of such other Award or award under such other plan in consideration for the
grant of such exchange or Substitute Award. In addition, Awards may be granted in lieu of cash compensation, including in lieu
of cash payments under other plans of the Company or an Affiliate. Notwithstanding Section 8.1 and Section 9.1,
but subject to Section 3.4, the Option Price of an Option or the SAR Price of a SAR that is a Substitute Award may
be less than one hundred percent (100%) of the Fair Market Value of a share of Stock on the original Grant Date; provided
that such Option Price or SAR Price is determined in accordance with the principles of Code Section 424 for any Incentive Stock
Option and consistent with Code Section 409A for any other Option or SAR.

 

		7.	AWARD AGREEMENT

 

Each Award granted
pursuant to the Plan shall be evidenced by an Award Agreement, which shall be in such form or forms as the Committee shall from
time to time determine. Award Agreements utilized under the Plan from time to time or at the same time need not contain similar
provisions but shall be consistent with the terms of the Plan. Each Award Agreement evidencing an Award of Options shall specify
whether such Options are intended to be Nonqualified Stock Options or Incentive Stock Options, and, in the absence of such specification,
such Options shall be deemed to constitute Nonqualified Stock Options. In the event of any inconsistency between the Plan and an
Award Agreement, the provisions of the Plan shall control.

 

    	 	14	 

     

    

 

		8.	TERMS AND CONDITIONS OF OPTIONS

 

		8.1	Option Price.

 

The Option Price
of each Option shall be fixed by the Committee and stated in the Award Agreement evidencing such Option. Except in the case of
Substitute Awards, the Option Price of each Option shall be at least the Fair Market Value of one (1) share of Stock on the
Grant Date; provided that, in the event that a Grantee is a Ten Percent Stockholder, the Option Price of an Option granted to such
Grantee that is intended to be an Incentive Stock Option shall be not less than one hundred ten percent (110%) of the Fair Market
Value of one (1) share of Stock on the Grant Date. In no case shall the Option Price of any Option be less than the par value of
one (1) share of Stock.

 

		8.2	Vesting and Exercisability.

 

Subject to Sections
8.3 and 16.3, each Option granted under the Plan shall become vested and/or exercisable at such times and under such
conditions as shall be determined by the Committee and stated in the Award Agreement, in another agreement with the Grantee, or
otherwise in writing; provided that no Option shall be granted to Grantees who are entitled to overtime under Applicable
Laws that will vest or be exercisable within a six (6)-month period starting on the Grant Date.

 

		8.3	Term.

 

(a)          Each
Option granted under the Plan shall terminate, and all rights to purchase shares of Stock thereunder shall cease, on the day before
the tenth (10th) anniversary of the Grant Date of such Option, or under such circumstances and on such date prior thereto
as is set forth in the Plan or as may be fixed by the Committee and stated in the Award Agreement relating to such Option; provided
that, in the event that the Grantee is a Ten Percent Stockholder, an Option granted to such Grantee that is intended to be an Incentive
Stock Option shall not be exercisable after the fifth (5th) anniversary of the Grant Date of such Option; and provided, further,
that, to the extent deemed necessary or appropriate by the Committee to reflect differences in local law, tax policy, or custom
with respect to any Option granted to a Grantee who is a foreign national or is a natural Person who is employed outside the United
States, such Option may terminate, and all rights to purchase shares of Stock thereunder may cease, upon the expiration of a period
longer than ten (10) years from the Grant Date of such Option as the Committee shall determine.

 

(b)          If
on the day preceding the date on which a Grantee’s Option would otherwise terminate, the aggregate Fair Market Value of shares
of Stock underlying the Option is greater than the aggregate Option Price of such Option, the Company shall,
prior to the termination of such Option and without any action being taken on the part of the Grantee, consider such Option
to have been exercised by the Grantee. The Company shall deduct from the shares of Stock deliverable to the Grantee upon such exercise
the number of shares of Stock necessary to satisfy payment of the Option Price and all withholding obligations.

 

		8.4	Termination of Service.

 

Each Award Agreement
with respect to the grant of an Option shall set forth the extent to which the Grantee thereof, if at all, shall have the right
to exercise such Option following termination of such Grantee’s Service. Such provisions shall be determined in the sole
discretion of the Committee, need not be uniform among all Options issued pursuant to the Plan, and may reflect distinctions based
on the reasons for termination of Service.

 

    	 	15	 

     

    

 

		8.5	Limitations on Exercise of Option.

 

Notwithstanding
any provision of the Plan to the contrary, in no event may any Option be exercised, in whole or in part, after the occurrence of
an event referred to in Article 16 which results in the termination of such Option.

 

		8.6	Method of Exercise.

 

Subject to the terms
of Article 14 and Section 18.3, an Option that is exercisable may be exercised by the Grantee’s delivery
to the Company or its designee or agent of notice of exercise on any business day, at the Company’s principal office or the
office of such designee or agent, on the form specified by the Company and in accordance with any additional procedures specified
by the Committee. Such notice shall specify the number of shares of Stock with respect to which such Option is being exercised
and shall be accompanied by payment in full of the Option Price of the shares of Stock for which such Option is being exercised,
plus the amount (if any) of federal and/or other taxes which the Company may, in its judgment, be required to withhold with respect
to the exercise of such Option.

 

		8.7	Rights of Holders of Options.

 

Unless otherwise
stated in the applicable Award Agreement, a Grantee or other Person holding or exercising an Option shall have none of the rights
of a stockholder of the Company (for example, the right to receive cash or dividend payments or distributions attributable to the
shares of Stock subject to such Option, to direct the voting of the shares of Stock subject to such Option, or to receive notice
of any meeting of the Company’s stockholders) until the shares of Stock subject thereto are fully paid and issued to such
Grantee or other Person. Except as provided in Article 16, no adjustment shall be made for dividends, distributions,
or other rights with respect to any shares of Stock subject to an Option for which the record date is prior to the date of issuance
of such shares of Stock.

 

		8.8	Delivery of Stock.

 

Promptly after the
exercise of an Option by a Grantee and the payment in full of the Option Price with respect thereto, such Grantee shall be entitled
to receive such evidence of such Grantee’s ownership of the shares of Stock subject to such Option as shall be consistent
with Section 3.7.

 

		8.9	Transferability of Options.

 

Except as provided
in Section 8.10, during the lifetime of a Grantee of an Option, only such Grantee (or, in the event of such Grantee’s
legal incapacity or incompetency, such Grantee’s guardian or legal representative) may exercise such Option. Except as provided
in Section 8.10, no Option shall be assignable or transferable by the Grantee to whom it is granted, other than by
will or the laws of descent and distribution.

 

    	 	16	 

     

    

 

		8.10	Family Transfers.

 

If authorized in
the applicable Award Agreement and by the Committee, in its sole discretion, a Grantee may transfer, not for value, all or part
of an Option which is not an Incentive Stock Option to any Family Member. For the purpose of this Section 8.10, a transfer
“not for value” is a transfer which is (a) a gift, (b) a transfer under a domestic relations order in settlement
of marital property rights, or (c) unless Applicable Laws do not permit such transfer, a transfer to an entity in which more
than fifty percent (50%) of the voting interests are owned by Family Members (and/or the Grantee) in exchange for an interest
in such entity. Following a transfer under this Section 8.10, any such Option shall continue to be subject to the same
terms and conditions as were applicable immediately prior to such transfer. Subsequent transfers of transferred Options shall be
prohibited except to Family Members of the original Grantee in accordance with this Section 8.10 or by will or the
laws of descent and distribution. The provisions of Section 8.4 relating to termination of Service shall continue to
be applied with respect to the original Grantee of the Option, following which such Option shall be exercisable by the transferee
only to the extent, and for the periods specified, in Section 8.4.

 

		8.11	Limitations on Incentive Stock Options.

 

An Option shall
constitute an Incentive Stock Option only (a) if the Grantee of such Option is an Employee of the Company or any corporate Subsidiary,
(b) to the extent specifically provided in the related Award Agreement, and (c) to the extent that the aggregate Fair Market Value
(determined at the time such Option is granted) of the shares of Stock with respect to which all Incentive Stock Options held by
such Grantee become exercisable for the first time during any calendar year (under the Plan and all other plans of the Company
and its Affiliates) does not exceed one hundred thousand dollars ($100,000). Except to the extent provided in the regulations under
Code Section 422, this limitation shall be applied by taking Options into account in the order in which they were granted.

 

		8.12	Notice of Disqualifying Disposition.

 

If any Grantee shall
make any disposition of shares of Stock issued pursuant to the exercise of an Incentive Stock Option under the circumstances provided
in Code Section 421(b) (relating to certain disqualifying dispositions), such Grantee shall notify the Company of such disposition
immediately but in no event later than ten (10) days thereafter.

 

		9.	TERMS AND CONDITIONS OF STOCK APPRECIATION RIGHTS

 

		9.1	Right to Payment and SAR Price.

 

A SAR shall confer
on the Grantee to whom it is granted a right to receive, upon exercise thereof, the excess of (a) the Fair Market Value of
one (1) share of Stock on the date of exercise, over (b) the SAR Price as determined by the Committee. The Award Agreement
for a SAR shall specify the SAR Price, which shall be no less than the Fair Market Value of one (1) share of Stock on the
Grant Date of such SAR. SARs may be granted in tandem with all or part of an Option granted under the Plan or at any subsequent
time during the term of such Option, in combination with all or any part of any other Award, or without regard to any Option or
other Award; provided that a SAR that is granted in tandem with all or part of an Option will have the same term, and expire at
the same time, as the related Option; provided, further, that a SAR that is granted subsequent to the Grant Date of a related Option
must have a SAR Price that is no less than the Fair Market Value of one (1) share of Stock on the Grant Date of such SAR.

 

    	 	17	 

     

    

 

		9.2	Other Terms.

 

Subject to Sections
9.3 and 16.3, the Committee shall determine, on the Grant Date or thereafter, the time or times at which, and the
circumstances under which, a SAR may be exercised in whole or in part (including based on achievement of performance goals and/or
future Service requirements); the time or times at which SARs shall cease to be or become exercisable following termination of
Service or upon other conditions; the method of exercise, method of settlement, form of consideration payable in settlement, method
by or forms in which shares of Stock shall be delivered or deemed to be delivered to Grantees, whether or not a SAR shall be granted
in tandem or in combination with any other Award; and any and all other terms and conditions of any SAR; provided that no
SARs shall be granted to Grantees who are entitled to overtime under Applicable Laws that will vest or be exercisable within a
six (6)-month period starting on the Grant Date.

 

		9.3	Term.

 

(a)          Each
SAR granted under the Plan shall terminate, and all rights thereunder shall cease, on the day before the tenth (10th) anniversary
of the Grant Date of such SAR or under such circumstances and on such date prior thereto as is set forth in the Plan or as may
be fixed by the Committee and stated in the Award Agreement relating to such SAR.

 

(b)          If
on the day preceding the date on which a Grantee’s SAR would otherwise terminate, the aggregate Fair Market Value of shares
of Stock underlying the SAR is greater than the aggregate SAR Price of such SAR, the Company shall, prior to the termination of
such SAR and without any action being taken on the part of the Grantee, consider such SAR to have been exercised by the Grantee.
The Company shall deduct from the shares of Stock deliverable to the Grantee upon such exercise the number of shares of Stock necessary
to satisfy payment of the SAR Price and all withholding obligations.

 

		9.4	Rights of Holders of SARs.

 

Unless otherwise
stated in the applicable Award Agreement, a Grantee or other Person holding or exercising a SAR shall have none of the rights of
a stockholder of the Company (for example, the right to receive cash or dividend payments or distributions attributable to the
shares of Stock underlying such SAR, to direct the voting of the shares of Stock underlying such SAR, or to receive notice of any
meeting of the Company’s stockholders) until the shares of Stock underlying such SAR, if any, are issued to such Grantee
or other Person. Except as provided in Article 16, no adjustment shall be made for dividends, distributions, or other
rights with respect to any shares of Stock underlying a SAR for which the record date is prior to the date of issuance of such
shares of Stock, if any.

 

		9.5	Transferability of SARs.

 

Except as provided
in Section 9.6, during the lifetime of a Grantee of a SAR, only the Grantee (or, in the event of such Grantee’s
legal incapacity or incompetency, such Grantee’s guardian or legal representative) may exercise such SAR. Except as provided
in Section 9.6, no SAR shall be assignable or transferable by the Grantee to whom it is granted, other than by will
or the laws of descent and distribution.

 

    	 	18	 

     

    

 

		9.6	Family Transfers.

 

If authorized in
the applicable Award Agreement and by the Committee, in its sole discretion, a Grantee may transfer, not for value, all or part
of a SAR to any Family Member. For the purpose of this Section 9.6, a transfer “not for value” is a transfer
which is (a) a gift, (b) a transfer under a domestic relations order in settlement of marital property rights, or (c) unless
Applicable Laws do not permit such transfer, a transfer to an entity in which more than fifty percent (50%) of the voting
interests are owned by Family Members (and/or the Grantee) in exchange for an interest in such entity. Following a transfer under
this Section 9.6, any such SAR shall continue to be subject to the same terms and conditions as were in effect immediately
prior to such transfer. Subsequent transfers of transferred SARs shall be prohibited except to Family Members of the original Grantee
in accordance with this Section 9.6 or by will or the laws of descent and distribution.

 

		10.	TERMS AND CONDITIONS OF RESTRICTED STOCK, RESTRICTED STOCK
UNITS, AND DEFERRED STOCK UNITS

 

		10.1	Grant of Restricted Stock, Restricted Stock Units,
and Deferred Stock Units.

 

Awards of Restricted
Stock, Restricted Stock Units, and Deferred Stock Units may be made for consideration or for no consideration, other than the par
value of the shares of Stock, which shall be deemed paid by past Service or, if so provided in the related Award Agreement or a
separate agreement, the promise by the Grantee to perform future Service to the Company or an Affiliate.

 

		10.2	Restrictions.

 

Subject to Sections
16.3 and 18.10, at the time a grant of Restricted Stock, Restricted Stock Units, or Deferred Stock Units is made,
the Committee may, in its sole discretion, (a) establish a Restricted Period applicable to such Restricted Stock, Restricted
Stock Units, or Deferred Stock Units and (b) prescribe restrictions in addition to or other than the expiration of the Restricted
Period, including the achievement of corporate or individual performance goals, which may be applicable to all or any portion of
such Restricted Stock, Restricted Stock Units, or Deferred Stock Units as provided in Article 13. Awards of Restricted
Stock, Restricted Stock Units, and Deferred Stock Units may not be sold, transferred, assigned, pledged, or otherwise encumbered
or disposed of during the Restricted Period or prior to the satisfaction of any other restrictions prescribed by the Committee
with respect to such Awards.

 

		10.3	Registration; Restricted Stock Certificates.

 

Pursuant to Section 3.7,
to the extent that ownership of Restricted Stock is evidenced by a book-entry registration or direct registration (including transaction
advices), such registration shall be notated to evidence the restrictions imposed on such Award of Restricted Stock under the Plan
and the applicable Award Agreement. Subject to Section 3.7 and the immediately following sentence, the Company may
issue, in the name of each Grantee to whom Restricted Stock has been granted, certificates representing the total number of shares
of Restricted Stock granted to the Grantee, as soon as reasonably practicable after the Grant Date of such Restricted Stock. The
Committee may provide in an Award Agreement with respect to an Award of Restricted Stock that either (a) the Secretary of
the Company shall hold such certificates for such Grantee’s benefit until such time as such shares of Restricted Stock are
forfeited to the Company or the restrictions applicable thereto lapse and such Grantee shall deliver a stock power to the Company
with respect to each certificate, or (b) such certificates shall be delivered to such Grantee, provided that such certificates
shall bear legends that comply with Applicable Laws and make appropriate reference to the restrictions imposed on such Award of
Restricted Stock under the Plan and such Award Agreement.

 

    	 	19	 

     

    

 

		10.4	Rights of Holders of Restricted Stock.

 

Unless the Committee
provides otherwise in an Award Agreement and subject to the restrictions set forth in the Plan, any applicable Company program,
and the applicable Award Agreement, holders of Restricted Stock shall have the right to vote such shares of Restricted Stock and
the right to receive any dividend payments or distributions declared or paid with respect to such shares of Restricted Stock. The
Committee may provide in an Award Agreement evidencing a grant of Restricted Stock that (a) any cash dividend payments or distributions
paid on Restricted Stock shall be reinvested in shares of Stock, which may or may not be subject to the same vesting conditions
and restrictions as applicable to such underlying shares of Restricted Stock or (b) any dividend payments or distributions declared
or paid on shares of Restricted Stock shall only be made or paid upon satisfaction of the vesting conditions and restrictions applicable
to such shares of Restricted Stock. Notwithstanding the foregoing, cash dividends declared or paid on shares of Restricted Stock
shall not vest or become payable unless and until the shares of Restricted Stock to which the dividends apply become vested and
nonforfeitable. All stock dividend payments or distributions, if any, received by a Grantee with respect to shares of Restricted
Stock as a result of any stock split, stock dividend, combination of stock, or other similar transaction shall be subject to the
same vesting conditions and restrictions as applicable to such underlying shares of Restricted Stock.

 

		10.5	Rights of Holders of Restricted Stock Units and Deferred
Stock Units.

 

		10.5.1	Voting and Dividend Rights.

 

Holders of Restricted
Stock Units and Deferred Stock Units shall have no rights as stockholders of the Company (for example, the right to receive dividend
payments or distributions attributable to the shares of Stock underlying such Restricted Stock Units and Deferred Stock Units,
to direct the voting of the shares of Stock underlying such Restricted Stock Units and Deferred Stock Units, or to receive notice
of any meeting of the Company’s stockholders); provided, however, that the Committee may provide in an Award Agreement evidencing
a grant of Restricted Stock Units or Deferred Stock Units that the holder of such Restricted Stock Units or Deferred Stock Units
shall be entitled to receive Dividend Equivalent Rights in accordance with Section 12.1.

 

		10.5.2	Creditor’s Rights.

 

A holder of Restricted
Stock Units or Deferred Stock Units shall have no rights other than those of a general unsecured creditor of the Company. Restricted
Stock Units and Deferred Stock Units represent unfunded and unsecured obligations of the Company, subject to the terms and conditions
of the applicable Award Agreement.

 

		10.6	Termination of Service.

 

Unless the Committee
provides otherwise in an Award Agreement, in another agreement with the Grantee, or otherwise in writing after such Award Agreement
is issued, but prior to termination of Grantee’s Service, upon the termination of such Grantee’s Service, any Restricted
Stock, Restricted Stock Units, or Deferred Stock Units held by such Grantee that have not vested, or with respect to which all
applicable restrictions and conditions have not lapsed, shall immediately be deemed forfeited. Upon forfeiture of such Restricted
Stock, Restricted Stock Units, or Deferred Stock Units, the Grantee thereof shall have no further rights with respect thereto,
including any right to vote such Restricted Stock or any right to receive dividends or Dividend Equivalent Rights, as applicable,
with respect to such Restricted Stock, Restricted Stock Units, or Deferred Stock Units.

 

    	 	20	 

     

    

 

		10.7	Purchase of Restricted Stock.

 

The Grantee of an
Award of Restricted Stock shall be required, to the extent required by Applicable Laws, to purchase such Restricted Stock from
the Company at a purchase price equal to the greater of (x) the aggregate par value of the shares of Stock represented by
such Restricted Stock or (y) the purchase price, if any, specified in the Award Agreement relating to such Restricted Stock.
Such purchase price shall be payable in a form provided in Article 14 or, in the sole discretion of the Committee,
in consideration for Service rendered or to be rendered by the Grantee to the Company or an Affiliate.

 

		10.8	Delivery of Shares of Stock.

 

Upon the expiration
or termination of any Restricted Period and the satisfaction of any other conditions prescribed by the Committee, including, without
limitation, any performance goals or delayed delivery period, the restrictions applicable to Restricted Stock, Restricted Stock
Units, or Deferred Stock Units settled in shares of Stock shall lapse, and, unless otherwise provided in the applicable Award Agreement,
a book-entry or direct registration (including transaction advices) or a certificate evidencing ownership of such shares of Stock
shall, consistent with Section 3.7, be issued, free of all such restrictions, to the Grantee thereof or such Grantee’s
beneficiary or estate, as the case may be. Neither the Grantee, nor the Grantee’s beneficiary or estate, shall have any further
rights with regard to a Restricted Stock Unit or Deferred Stock Unit once the shares of Stock represented by such Restricted Stock
Unit or Deferred Stock Unit have been delivered in accordance with this Section 10.8.

 

		11.	TERMS AND CONDITIONS OF UNRESTRICTED STOCK AWARDS AND OTHER
EQUITY-BASED AWARDS

 

		11.1	Unrestricted Stock Awards.

 

The Committee may,
in its sole discretion, grant (or sell at the par value of a share of Stock or at such other higher purchase price as shall be
determined by the Committee) an Award to any Grantee pursuant to which such Grantee may receive shares of Unrestricted Stock under
the Plan. Awards of Unrestricted Stock may be granted or sold to any Grantee as provided in the immediately preceding sentence
in respect of Service rendered or, if so provided in the related Award Agreement or a separate agreement, to be rendered by the
Grantee to the Company or an Affiliate or other valid consideration, in lieu of or in addition to any cash compensation due to
such Grantee.

 

		11.2	Other Equity-Based Awards.

 

The Committee may,
in its sole discretion, grant Awards in the form of Other Equity-Based Awards, as deemed by the Committee to be consistent with
the purposes of the Plan. Awards granted pursuant to this Section 11.2 may be granted with vesting, value, and/or payment
contingent upon the achievement of one or more performance goals. The Committee shall determine the terms and conditions of Other
Equity-Based Awards on the Grant Date or thereafter. Unless the Committee provides otherwise in an Award Agreement, in another
agreement with the Grantee, or otherwise in writing after such Award Agreement is issued, but prior to termination of Grantee’s
Service, upon the termination of a Grantee’s Service, any Other Equity-Based Awards held by such Grantee that have not vested,
or with respect to which all applicable restrictions and conditions have not lapsed, shall immediately be deemed forfeited. Upon
forfeiture of any Other Equity-Based Award, the Grantee thereof shall have no further rights with respect to such Other Equity-Based
Award.

 

    	 	21	 

     

    

 

		12.	TERMS AND CONDITIONS OF DIVIDEND EQUIVALENT RIGHTS

 

		12.1	Dividend Equivalent Rights.

 

A Dividend Equivalent
Right may be granted hereunder, provided that no Dividend Equivalent Rights may be granted in connection with, or related
to, an Award of Options or SARs. The terms and conditions of Dividend Equivalent Rights shall be specified in the Award Agreement
therefor. Dividend equivalents credited to the holder of a Dividend Equivalent Right may be paid currently (with or without being
subject to forfeiture or a repayment obligation) or may be deemed to be reinvested in additional shares of Stock or Awards, which
may thereafter accrue additional Dividend Equivalent Rights (with or without being subject to forfeiture or a repayment obligation).
Any such reinvestment shall be at the Fair Market Value thereof on the date of such reinvestment. Dividend Equivalent Rights may
be settled in cash, shares of Stock, or a combination thereof, in a single installment or in multiple installments, all as determined
in the sole discretion of the Committee. A Dividend Equivalent Right granted as a component of another Award may (a) provide that
such Dividend Equivalent Right shall be settled upon exercise, settlement, or payment of, or lapse of restrictions on, such other
Award and that such Dividend Equivalent Right shall expire or be forfeited or annulled under the same conditions as such other
Award or (b) contain terms and conditions which are different from the terms and conditions of such other Award, provided that
notwithstanding the foregoing Dividend Equivalent Rights granted as a component of another Award shall not vest or become payable
unless and until the Award to which the Dividend Equivalent Rights correspond become vested and settled.

 

		12.2	Termination of Service.

 

Unless the Committee
provides otherwise in an Award Agreement, in another agreement with the Grantee, or otherwise in writing after such Award Agreement
is issued, a Grantee’s rights in all Dividend Equivalent Rights shall automatically terminate upon such Grantee’s termination
of Service for any reason.

 

		13.	TERMS AND CONDITIONS OF PERFORMANCE-BASED AWARDS

 

		13.1	Grant of Performance-Based Awards.

 

Subject to the terms
and provisions of the Plan, the Committee, at any time and from time to time, may grant Performance-Based Awards in such amounts
and upon such terms as the Committee shall determine.

 

		13.2	Value of Performance-Based Awards.

 

Each grant of a
Performance-Based Award shall have an initial cash value or an actual or target number of shares of Stock that is established by
the Committee as of the Grant Date. The Committee shall set performance goals in its discretion which, depending on the extent
to which they are achieved, shall determine the value and/or number of shares of Stock subject to a Performance-Based Award that
will be paid out to the Grantee thereof.

 

    	 	22	 

     

    

 

		13.3	Earning of Performance-Based Awards.

 

Subject to the terms
of the Plan, in particular Section 13.6.3, after the applicable Performance Period has ended, the Grantee of a Performance-Based
Award shall be entitled to receive a payout of the value earned under such Performance-Based Award by such Grantee over such Performance
Period.

 

		13.4	Form and Timing of Payment of Performance-Based Awards.

 

Payment of the value
earned under Performance-Based Awards shall be made, as determined by the Committee, in the form, at the time, and in the manner
described in the applicable Award Agreement. Subject to the terms of the Plan, the Committee, in its sole discretion, (i) may pay
the value earned under Performance-Based Awards in the form of cash, shares of Stock, other Awards, or a combination thereof, including
shares of Stock and/or Awards that are subject to any restrictions deemed appropriate by the Committee, and (ii) shall pay the
value earned under Performance-Based Awards at the close of the applicable Performance Period, or as soon as reasonably practicable
after the Committee has determined that the performance goal or goals relating thereto have been achieved; provided that, unless
specifically provided in the Award Agreement for such Performance-Based Awards, such payment shall occur no later than the fifteenth
(15th) day of the third (3rd) month following the end of the calendar year in which such Performance Period
ends.

 

		13.5	Performance Conditions.

 

The right of a Grantee
to exercise or to receive a grant or settlement of any Performance-Based Award, and the timing thereof, may be subject to such
performance conditions as may be specified by the Committee. The Committee may use such business criteria and other measures of
performance as it may deem appropriate in establishing any performance conditions. If and to the extent required under Code Section 162(m),
any power or authority relating to an Award intended to qualify under Code Section 162(m) shall be exercised by the Committee
and not by the Board.

 

		13.6	Performance-Based Awards Granted to Designated Covered
Employees.

 

If and to the extent
that the Committee determines that a Performance-Based Award to be granted to a Grantee should constitute Qualified Performance-Based
Compensation for purposes of Code Section 162(m), the grant, exercise, and/or settlement of such Performance-Based Award shall
be contingent upon achievement of pre-established performance goals and other terms set forth in this Section 13.6.

 

		13.6.1	Performance Goals Generally.

 

The performance
goals for Performance-Based Awards shall consist of one or more business criteria and a targeted level or levels of performance
with respect to each of such criteria, as specified by the Committee consistent with this Section 13.6. Performance
goals shall be objective and shall otherwise meet the requirements of Code Section 162(m), including the requirement that
the level or levels of performance targeted by the Committee result in the achievement of performance goals being “substantially
uncertain.” The Committee may determine that such Awards shall be granted, exercised, and/or settled upon achievement of
any single performance goal or of two (2) or more performance goals. Performance goals may differ for Performance-Based Awards
granted to any one Grantee or to different Grantees.

 

    	 	23	 

     

    

 

		13.6.2	Timing For Establishing Performance Goals.

 

Performance goals
for any Performance-Based Award shall be established not later than the earlier of (a) ninety (90) days after the beginning
of any Performance Period applicable to such Performance-Based Award, and (b) the date on which twenty-five percent (25%) of
any Performance Period applicable to such Performance-Based Award has expired, or at such other date as may be required or permitted
for compensation payable to a Covered Employee to constitute Performance-Based Compensation.

 

		13.6.3	Payment of Awards; Other Terms.

 

Payment of Performance-Based
Awards shall be in cash, shares of Stock, other Awards, or a combination thereof, including shares of Stock and/or Awards that
are subject to any restrictions deemed appropriate by the Committee, in each case as determined in the sole discretion of the Committee.
The Committee may, in its sole discretion, reduce the amount of a payment otherwise to be made in connection with such Performance-Based
Awards. The Committee shall specify the circumstances in which such Performance-Based Awards shall be paid or forfeited in the
event of termination of Service by the Grantee prior to the end of a Performance Period or settlement of such Performance-Based
Awards. In the event payment of the Performance-Based Award is made in the form of another Award subject to Service-based vesting,
the Committee shall specify the circumstances in which the payment Award will be paid or forfeited in the event of a termination
of Service.

 

		13.6.4	Performance Measures.

 

The performance
goals upon which the vesting or payment of a Performance-Based Award to a Covered Employee that is intended to qualify as Performance-Based
Compensation may be conditioned shall be limited to the following Performance Measures, with or without adjustment (including pro
forma adjustments):

 

(a)          total
stockholder return;

 

(b)          such
total stockholder return as compared to total return (on a comparable basis) of a publicly available index such as, but not limited
to, the Standard & Poor’s 500 Stock Index

 

(c)          net
income;

 

(d)          pretax
earnings;

 

(e)          earnings
before interest, taxes, depreciation, and/or amortization as adjusted to exclude any one or more of the following:

 

		•	stock-based compensation expense;

 

		•	income from discontinued operations;

 

		•	gain on cancellation of debt;

 

		•	debt extinguishment and related costs;

 

    	 	24	 

     

    

 

		•	restructuring, separation, and/or integration charges
and costs;

 

		•	reorganization and/or recapitalization charges and
costs;

 

		•	impairment charges;

 

		•	merger-related events;

 

		•	gain or loss related to investments;

 

		•	sales and use tax settlements; and

 

		•	gain on non-monetary transactions;

 

		(f)	pretax operating earnings after interest expense and
before bonuses, service fees, and extraordinary or special items;

		 	 

		(g)	operating margin;

		 	 

		(h)	earnings per share;

		 	 

		(i)	return measures, including return on assets, capital,
investment, equity, sales, or revenue;

 

		(j)	cash flow, including operating cash flow, free cash
flow, levered free cash flow, cash flow return on equity, and cash flow return on investment;

 

		(k)	operating earnings;

		 	 

		(l)	working capital;

		 	 

		(m)	ratio of debt to stockholders’ equity;

		 	 

		(n)	revenue;

		 	 

		(o)	demonstrated sound financial, budgeting and operational
practices;

		 	 

		(p)	changes to processes, systems, technology, and reporting
models;

		 	 

		(q)	student academic performance;

		 	 

		(r)	improvements to student services;

		 	 

		(s)	student satisfaction surveys or measures;

		 	 

		(t)	quality measures, including ranking of the Company
by third parties;

		 	 

		(u)	acquisitions, divestitures, or new program developments;

		 	 

		(v)	improvements to academic rigor, faculty qualifications,
and curriculum development;

 

    	 	25	 

     

    

 

(w)          performance
with respect to regulatory requirements, including compliance with those promulgated by the Department of Education;

 

(x)          regulatory
approvals to operate in new states;

 

(y)          maintaining
regional accreditation;

 

(z)          maintaining
or obtaining specialized accreditations; and

 

(aa)         any
combination of the foregoing business criteria.

 

Performance under
any of the foregoing Performance Measures (a) may be used to measure the performance of (i) the Company, its Subsidiaries,
and other Affiliates as a whole, (ii) the Company, any Subsidiary, any other Affiliate, or any combination thereof, or (iii) any
one or more business units or operating segments of the Company, any Subsidiary, and/or any other Affiliate, in each case as the
Committee, in its sole discretion, deems appropriate and (b) may be compared to the performance of one or more other companies
or one or more published or special indices designated or approved by the Committee for such comparison, as the Committee, in its
sole discretion, deems appropriate. In addition, the Committee, in its sole discretion, may select performance under the Performance
Measure specified in clause (h) above for comparison to performance under one or more stock market indices designated or approved
by the Committee. The Committee shall also have the authority to provide for accelerated vesting of any Performance-Based Award
based on the achievement of performance goals pursuant to the Performance Measures specified in this Article 13.

 

		13.6.5	Evaluation of Performance.

 

The Committee may
provide in any Performance-Based Award that any evaluation of performance may include or exclude any of the following events that
occur during a Performance Period: (a) asset write-downs; (b) litigation or claims, judgments, or settlements; (c) the
effect of changes in tax laws, accounting principles, or other laws or provisions affecting reported results; (d) any reorganization
or restructuring events or programs; (e) extraordinary, non-core, non-operating, or non-recurring items and items that are
either of an unusual nature or of a type that indicates infrequency of occurrence as a separate component of income from continuing
operations; (f) acquisitions or divestitures; (g) foreign exchange gains and losses; (h) impact of shares of Stock purchased
through share repurchase programs; (i) tax valuation allowance reversals; (j) impairment expense; and (k) environmental expense.
To the extent such inclusions or exclusions affect Awards to Covered Employees that are intended to qualify as Performance-Based
Compensation, such inclusions or exclusions shall be prescribed in a form that meets the requirements of Code Section 162(m)
for deductibility.

 

		13.6.6	Adjustment of Performance-Based Compensation.

 

The Committee shall
have the sole discretion to adjust Awards that are intended to qualify as Performance-Based Compensation, either on a formula or
discretionary basis, or on any combination thereof, as the Committee determines consistent with the requirements of Code Section 162(m)
for deductibility.

 

    	 	26	 

     

    

 

		13.6.7	Committee Discretion.

 

In the event that
Applicable Laws change to permit Committee discretion to alter the governing Performance Measures without obtaining stockholder
approval of such changes, the Committee shall have sole discretion to make such changes without obtaining stockholder approval,
provided that the exercise of such discretion shall not be inconsistent with the requirements of Code Section 162(m). In addition,
in the event that the Committee determines that it is advisable to grant Awards that shall not qualify as Performance-Based Compensation,
the Committee may make such grants without satisfying the requirements of Code Section 162(m) and base vesting on Performance
Measures other than those set forth in Section 13.6.4.

 

		13.6.8	Status of Awards Under Code Section 162(m).

 

It is the intent
of the Company that Performance-Based Awards under Section 13.6 granted to Grantees who are designated by the Committee
as likely to be Covered Employees shall, if so designated by the Committee, constitute Qualified Performance-Based Compensation.
Accordingly, the terms of Section 13.6, including the definitions of Covered Employee and other terms used therein,
shall be interpreted in a manner consistent with Code Section 162(m). If any provision of the Plan, the applicable Award Agreement,
or any other agreement relating to any such Performance-Based Award does not comply or is inconsistent with the requirements of
Code Section 162(m), such provision shall be construed or deemed amended to the extent necessary to conform to such requirements.

 

		14.	FORMS OF PAYMENT

 

		14.1	General Rule.

 

Payment of the Option
Price for the shares of Stock purchased pursuant to the exercise of an Option or the purchase price, if any, for Restricted Stock
shall be made in cash or in cash equivalents acceptable to the Company.

 

		14.2	Surrender of Shares of Stock.

 

To the extent that
the applicable Award Agreement so provides, payment of the Option Price for shares of Stock purchased pursuant to the exercise
of an Option or the purchase price, if any, for Restricted Stock may be made all or in part through the tender or attestation to
the Company of shares of Stock, which shall be valued, for purposes of determining the extent to which such Option Price or purchase
price has been paid thereby, at their Fair Market Value on the date of such tender or attestation.

 

		14.3	Cashless Exercise.

 

To the extent permitted
by Applicable Laws and to the extent the Award Agreement so provides, payment of the Option Price for shares of Stock purchased
pursuant to the exercise of an Option may be made all or in part by delivery (on a form acceptable to the Committee) of an irrevocable
direction to a licensed securities broker acceptable to the Company to sell shares of Stock and to deliver all or part of the proceeds
of such sale to the Company in payment of such Option Price and/or any withholding taxes described in Section 18.3.

 

    	 	27	 

     

    

 

		14.4	Other Forms of Payment.

 

To the extent that
the applicable Award Agreement so provides and/or unless otherwise specified in an Award Agreement, payment of the Option Price
for shares of Stock purchased pursuant to exercise of an Option or the purchase price, if any, for Restricted Stock may be made
in any other form that is consistent with Applicable Laws, including (a) with respect to Restricted Stock only, Service rendered
or to be rendered by the Grantee thereof to the Company or an Affiliate and (b) with the consent of the Company, by withholding
the number of shares of Stock that would otherwise vest or be issuable in an amount equal in value to the Option Price or purchase
price and/or the required tax withholding amount.

 

		15.	REQUIREMENTS OF LAW

 

		15.1	General.

 

The Company shall
not be required to offer, sell, or issue any shares of Stock under any Award, whether pursuant to the exercise of an Option, a
SAR, or otherwise, if the offer, sale, or issuance of such shares of Stock would constitute a violation by the Grantee, the Company,
an Affiliate, or any other Person of any provision of the Company’s certificate of incorporation or bylaws or of Applicable
Laws, including any federal or state securities laws or regulations. If at any time the Company shall determine, in its discretion,
that the listing, registration, or qualification of any shares of Stock subject to an Award upon any Stock Exchange or Securities
Market or under any governmental regulatory body is necessary or desirable as a condition of, or in connection with, the offering,
sale, issuance, or purchase of shares of Stock in connection with any Award, no shares of Stock may be offered, sold, or issued
to the Grantee or any other Person under such Award, whether pursuant to the exercise of an Option, a SAR, or otherwise, unless
such listing, registration, or qualification shall have been effected or obtained free of any conditions not acceptable to the
Company, and any delay caused thereby shall in no way affect the date of termination of such Award. Without limiting the generality
of the foregoing, upon the exercise of any Option or any SAR that may be settled in shares of Stock or the delivery of any shares
of Stock underlying an Award, unless a registration statement under the Securities Act is in effect with respect to the shares
of Stock subject to such Award, the Company shall not be required to offer, sell, or issue such shares of Stock unless the Committee
shall have received evidence satisfactory to it that the Grantee or any other Person exercising such Option or SAR or accepting
delivery of such shares may acquire such shares of Stock pursuant to an exemption from registration under the Securities Act. Any
determination by the Committee in connection with the foregoing shall be final, binding, and conclusive. The Company may register,
but shall in no event be obligated to register, any shares of Stock or other securities issuable pursuant to the Plan pursuant
to the Securities Act. The Company shall not be obligated to take any affirmative action in order to cause the exercise of an Option
or a SAR or the issuance of shares of Stock or other securities issuable pursuant to the Plan or any Award to comply with any Applicable
Laws. As to any jurisdiction that expressly imposes the requirement that an Option or SAR that may be settled in shares of Stock
shall not be exercisable until the shares of Stock subject to such Option or SAR are registered under the securities laws thereof
or are exempt from such registration, the exercise of such Option or SAR under circumstances in which the laws of such jurisdiction
apply shall be deemed conditioned upon the effectiveness of such registration or the availability of such an exemption.

 

    	 	28	 

     

    

 

		15.2	Rule 16b-3.

 

During any time
when the Company has any class of common equity securities registered under Section 12 of the Exchange Act, it is the intention
of the Company that Awards pursuant to the Plan and the exercise of Options and SARs granted hereunder that would otherwise be
subject to Section 16(b) of the Exchange Act shall qualify for the exemption provided by Rule 16b-3 under the Exchange Act.
To the extent that any provision of the Plan or action by the Committee does not comply with the requirements of such Rule 16b-3,
such provision or action shall be deemed inoperative with respect to such Awards to the extent permitted by Applicable Laws and
deemed advisable by the Committee and shall not affect the validity of the Plan. In the event that such Rule 16b-3 is revised or
replaced, the Committee may exercise its discretion to modify the Plan in any respect necessary or advisable in its judgment to
satisfy the requirements of, or to permit the Company to avail itself of the benefits of, the revised exemption or its replacement.

 

		16.	EFFECT OF CHANGES IN CAPITALIZATION

 

		16.1	Changes in Stock.

 

If the number of
outstanding shares of Stock is increased or decreased or the shares of Stock are changed into or exchanged for a different number
of shares or kind of Capital Stock or other securities of the Company on account of any recapitalization, reclassification, stock
split, reverse stock split, spin-off, combination of stock, exchange of stock, stock dividend or other distribution payable in
capital stock, or other increase or decrease in shares of Stock effected without receipt of consideration by the Company occurring
after the Effective Date, the number and kinds of shares of Capital Stock for which grants of Options and other Awards may be made
under the Plan, including the Share Limit set forth in Section 4.1 and the individual share limitations set forth in Section 6.2,
shall be adjusted proportionately and accordingly by the Committee. In addition, the number and kind of shares of Capital Stock
for which Awards are outstanding shall be adjusted proportionately and accordingly by the Committee so that the proportionate interest
of the Grantee therein immediately following such event shall, to the extent practicable, be the same as immediately before such
event. Any such adjustment in outstanding Options or SARs shall not change the aggregate Option Price or SAR Price payable with
respect to shares that are subject to the unexercised portion of such outstanding Options or SARs, as applicable, but shall include
a corresponding proportionate adjustment in the per share Option Price or SAR Price, as the case may be. The conversion of any
convertible securities of the Company shall not be treated as an increase in shares effected without receipt of consideration.
Notwithstanding the foregoing, in the event of any distribution to the Company’s stockholders of securities of any other
entity or other assets (including an extraordinary dividend, but excluding a non-extraordinary dividend, declared and paid by the
Company) without receipt of consideration by the Company, the Board or the Committee constituted pursuant to Section 3.1.2
shall, in such manner as the Board or the Committee deems appropriate, adjust (a) the number and kind of shares of Capital
Stock subject to outstanding Awards and/or (b) the aggregate and per share Option Price of outstanding Options and the aggregate
and per share SAR Price of outstanding SARs as required to reflect such distribution.

 

		16.2	Reorganization in Which the Company Is the Surviving
Entity Which Does not Constitute a Corporate Transaction.

 

Subject to Section 16.3,
if the Company shall be the surviving entity in any reorganization, merger, or consolidation of the Company with one or more other
entities which does not constitute a Corporate Transaction, any Award theretofore granted pursuant to the Plan shall pertain to
and apply to the Capital Stock to which a holder of the number of shares of Stock subject to such Award would have been entitled
immediately following such reorganization, merger, or consolidation, with a corresponding proportionate adjustment of the per share
Option Price or SAR Price of any outstanding Option or SAR so that the aggregate Option Price or SAR Price thereafter shall be
the same as the aggregate Option Price or SAR Price of the shares of Stock remaining subject to the Option or SAR as in effect
immediately prior to such reorganization, merger, or consolidation. Subject to any contrary language in an Award Agreement, in
another agreement with the Grantee, or as otherwise set forth in writing, any restrictions applicable to such Award shall apply
as well to any replacement shares of Capital Stock subject to such Award, or received by the Grantee, as a result of such reorganization,
merger, or consolidation. In the event of any reorganization, merger, or consolidation of the Company referred to in this Section 16.2,
Performance-Based Awards shall be adjusted (including any adjustment to the Performance Measures applicable to such Awards deemed
appropriate by the Committee) so as to apply to the Capital Stock that a holder of the number of shares of Stock subject to the
Performance-Based Awards would have been entitled to receive immediately following such reorganization, merger, or consolidation.

 

    	 	29	 

     

    

 

		16.3	Corporate Transaction in which Awards are not Assumed.

 

Except as otherwise
provided in the applicable Award Agreement, in another agreement with the Grantee, or as otherwise set forth in writing, upon the
occurrence of a Corporate Transaction in which outstanding Awards are not being assumed, continued, or substituted for, the following
provisions shall apply to such Award, to the extent not assumed, continued, or substituted for:

 

(a)          Immediately
prior to the occurrence of such Corporate Transaction, in each case with the exception of Performance-Based Awards, all outstanding
shares of Restricted Stock, and all Restricted Stock Units, Deferred Stock Units, and Dividend Equivalent Rights shall be deemed
to have vested, and all shares of Stock and/or cash subject to such Awards shall be delivered; and either or both of the following
two (2) actions shall be taken:

 

(i)          At
least fifteen (15) days prior to the scheduled consummation of such Corporate Transaction, all Options and SARs outstanding
hereunder shall become immediately exercisable and shall remain exercisable for a period of fifteen (15) days. Any exercise
of an Option or SAR during this fifteen (15)-day period shall be conditioned upon the consummation of the applicable Corporate
Transaction and shall be effective only immediately before the consummation thereof, and upon consummation of such Corporate Transaction,
the Plan and all outstanding but unexercised Options and SARs shall terminate, with or without consideration (including, without
limitation, consideration in accordance with clause (ii) below) as determined by the Committee in its sole discretion. The Committee
shall send notice of an event that shall result in such a termination to all Persons who hold Options and SARs not later than the
time at which the Company gives notice thereof to its stockholders.

 

and/or

 

(ii)         The
Committee may elect, in its sole discretion, to cancel any outstanding Awards of Options, SARs, Restricted Stock, Restricted Stock
Units, Deferred Stock Units, and/or Dividend Equivalent Rights and pay or deliver, or cause to be paid or delivered, to the holder
thereof an amount in cash or Capital Stock having a value (as determined by the Committee acting in good faith), in the case of
Restricted Stock, Restricted Stock Units, Deferred Stock Units, and Dividend Equivalent Rights (for shares of Stock subject thereto),
equal to the formula or fixed price per share paid to holders of shares of Stock pursuant to such Corporate Transaction and, in
the case of Options or SARs, equal to the product of the number of shares of Stock subject to such Options or SARs multiplied by
the amount, if any, by which (x) the formula or fixed price per share paid to holders of shares of Stock pursuant to such
transaction exceeds (y) the Option Price or SAR Price applicable to such Options or SARs.

 

    	 	30	 

     

    

 

(b)          For
Performance-Based Awards, if less than half of the Performance Period has lapsed, such Performance-Based Awards shall be treated
as though target performance has been achieved. If at least half of the Performance Period has lapsed, actual performance to date
shall be determined as of a date reasonably proximal to the date of consummation of the Corporate Transaction as determined by
the Committee, in its sole discretion, and that level of performance thus determined shall be treated as achieved immediately prior
to occurrence of the Corporate Transaction. For purposes of the preceding sentence, if, based on the discretion of the Committee,
actual performance is not determinable, the Performance-Based Awards shall be treated as though target performance has been achieved.
After application of this Section 16.3(b), if any Awards arise from application of this Section 16.3(b), such Awards
shall be settled under the applicable provision of Section 16.3(a).

 

(c)          Other
Equity-Based Awards shall be governed by the terms of the applicable Award Agreement.

 

		16.4	Corporate Transaction in which Awards are Assumed.

 

Except as otherwise
provided in the applicable Award Agreement, in another agreement with the Grantee, or as otherwise set forth in writing, upon the
occurrence of a Corporate Transaction in which outstanding Awards are being assumed, continued, or substituted for, the following
provisions shall apply to such Award, to the extent assumed, continued, or substituted for:

 

(a)          The
Plan and the Options, SARs, Restricted Stock, Restricted Stock Units, Deferred Stock Units, Dividend Equivalent Rights, and Other
Equity-Based Awards granted under the Plan shall continue in the manner and under the terms so provided in the event of any Corporate
Transaction to the extent that provision is made in writing in connection with such Corporate Transaction for the assumption or
continuation of such Options, SARs, Restricted Stock, Restricted Stock Units, Deferred Stock Units, Dividend Equivalent Rights,
and Other Equity-Based Awards, or for the substitution for such Options, SARs, Restricted Stock, Restricted Stock Units, Deferred
Stock Units, Dividend Equivalent Rights, and Other Equity-Based Awards of new stock options, stock appreciation rights, restricted
stock, restricted stock units, deferred stock units, dividend equivalent rights, and other equity-based awards relating to the
Capital Stock of a successor entity, or a parent or subsidiary thereof, with appropriate adjustments as to the number of shares
(disregarding any consideration that is not common stock) and exercise prices of options and stock appreciation rights.

 

(b)          In
the event a Grantee’s Award is assumed, continued or substituted upon the consummation of any Corporate Transaction and the
Grantee’s employment is terminated without Cause within one year following the consummation of such Corporate Transaction,
the Grantee’s Award will be fully vested and may be exercised in full, to the extent applicable, beginning on the date of
such termination and for the one-year period immediately following such termination or for such longer period as the Committee
shall determine.

 

    	 	31	 

     

    

 

		16.5	Adjustments.

 

Adjustments under
this Article 16 related to shares of Stock or other Capital Stock of the Company shall be made by the Committee, whose
determination in that respect shall be final, binding, and conclusive. No fractional shares or other securities shall be issued
pursuant to any such adjustment, and any fractions resulting from any such adjustment shall be eliminated in each case by rounding
downward to the nearest whole share. The Committee may provide in the applicable Award Agreement as of the Grant Date, in another
agreement with the Grantee, or otherwise in writing at any time thereafter with the consent of the Grantee, for different provisions
to apply to an Award in place of those provided in Sections 16.1, 16.2, 16.3, and 16.4. This Article 16
shall not limit the Committee’s ability to provide for alternative treatment of Awards outstanding under the Plan in the
event of a change in control event involving the Company that is not a Corporate Transaction.

 

		16.6	No Limitations on Company.

 

The making of Awards
pursuant to the Plan shall not affect or limit in any way the right or power of the Company to make adjustments, reclassifications,
reorganizations, or changes of its capital or business structure or to merge, consolidate, dissolve, or liquidate, or to sell or
transfer all or any part of its business or assets (including all or any part of the business or assets of any Subsidiary or other
Affiliate) or to engage in any other transaction or activity.

 

		17.	PARACHUTE LIMITATIONS

 

If any Grantee is
a Disqualified Individual, then, notwithstanding any other provision of the Plan or of any Other Agreement to the contrary and
notwithstanding any Benefit Arrangement, any right of the Grantee to any exercise, vesting, payment, or benefit under the Plan
shall be reduced or eliminated:

 

(a)          to
the extent that such right to exercise, vesting, payment, or benefit, taking into account all other rights, payments, or benefits
to or for the Grantee under the Plan, all Other Agreements, and all Benefit Arrangements, would cause any exercise, vesting, payment,
or benefit to the Grantee under the Plan to be considered a Parachute Payment; and

 

(b)          if,
as a result of receiving such Parachute Payment, the aggregate after-tax amounts received by the Grantee from the Company under
the Plan, all Other Agreements, and all Benefit Arrangements would be less than the maximum after-tax amount that could be received
by the Grantee without causing any such payment or benefit to be considered a Parachute Payment.

 

Except as required
by Code Section 409A or to the extent that Code Section 409A permits discretion, the Committee shall have the right, in the Committee’s
sole discretion, to designate those rights, payments, or benefits under the Plan, all Other Agreements, and all Benefit Arrangements
that should be reduced or eliminated so as to avoid having such rights, payments, or benefits be considered a Parachute Payment;
provided, however, to the extent any payment or benefit constitutes deferred compensation under Code Section 409A, in order to
comply with Code Section 409A, the Company shall instead accomplish such reduction by first reducing or eliminating any cash payments
(with the payments to be made furthest in the future being reduced first), then by reducing or eliminating any accelerated vesting
of Performance-Based Awards, then by reducing or eliminating any accelerated vesting of Options or SARs, then by reducing or eliminating
any accelerated vesting of Restricted Stock, Restricted Stock Units, or Deferred Stock Units, then by reducing or eliminating any
other remaining Parachute Payments.

 

    	 	32	 

     

    

 

		18.	GENERAL PROVISIONS

 

		18.1	Disclaimer of Rights.

 

No provision in
the Plan, any Award, or any Award Agreement shall be construed (a) to confer upon any individual the right to remain in the Service
of the Company or an Affiliate, (b) to interfere in any way with any contractual or other right or authority of the Company or
an Affiliate either to increase or decrease the compensation or other payments to any Person at any time, or (c) to terminate any
Service or other relationship between any Person and the Company or an Affiliate. In addition, notwithstanding any provision of
the Plan to the contrary, unless otherwise stated in the applicable Award Agreement, in another agreement with the Grantee, or
otherwise in writing, no Award granted under the Plan shall be affected by any change of duties or position of the Grantee thereof,
so long as such Grantee continues to provide Service. The obligation of the Company to pay any benefits pursuant to the Plan shall
be interpreted as a contractual obligation to pay only those amounts provided herein, in the manner and under the conditions prescribed
herein. The Plan and Awards shall in no way be interpreted to require the Company to transfer any amounts to a third-party trustee
or otherwise hold any amounts in trust or escrow for payment to any Grantee or beneficiary under the terms of the Plan.

 

		18.2	Nonexclusivity of the Plan.

 

Neither the adoption
of the Plan nor the submission of the Plan to the stockholders of the Company for approval shall be construed as creating
any limitations upon the right and authority of the Board or the Committee to adopt such other incentive compensation arrangements
(which arrangements may be applicable either generally to a class or classes of individuals or specifically to a particular individual
or particular individuals) as the Board or the Committee in their discretion determine desirable.

 

		18.3	Withholding Taxes.

 

(a)          The
Company or an Affiliate, as the case may be, shall have the right to deduct from payments of any kind otherwise due to a Grantee
any federal, state, or local taxes of any kind required by Applicable Laws to be withheld with respect to the vesting of or other
lapse of restrictions applicable to an Award or upon the issuance of any shares of Stock upon the exercise of an Option or pursuant
to any other Award. At the time of such vesting, lapse, or exercise, the Grantee shall pay in cash to the Company or an Affiliate,
as the case may be, any amount that the Company or such Affiliate may reasonably determine to be necessary to satisfy such withholding
obligation; provided that if there is a same-day sale of shares of Stock subject to an Award, the Grantee shall pay such withholding
obligation on the day on which such same-day sale is completed. Subject to the prior approval of the Company or an Affiliate, which
may be withheld by the Company or such Affiliate, as the case may be, in its sole discretion, the Grantee may elect to satisfy
such withholding obligation, in whole or in part, (a) by causing the Company or such Affiliate to withhold shares of Stock
otherwise issuable to the Grantee or (b) by delivering to the Company or such Affiliate shares of Stock already owned by the
Grantee. The shares of Stock so withheld or delivered shall have an aggregate Fair Market Value equal to such withholding obligation.
The Fair Market Value of the shares of Stock used to satisfy such withholding obligation shall be determined by the Company or
such Affiliate as of the date on which the amount of tax to be withheld is to be determined. A Grantee who has made an election
pursuant to this Section 18.3 may satisfy such Grantee’s withholding obligation only with shares of Stock that
are not subject to any repurchase, forfeiture, unfulfilled vesting, or other similar requirements.

 

    	 	33	 

     

    

 

(b)          The
maximum number of shares of Stock that may be withheld from any Award to satisfy any federal, state, or local tax withholding requirements
upon the exercise, vesting, or lapse of restrictions applicable to any Award or payment of shares of Stock pursuant to such Award,
as applicable, may not exceed such number of shares of Stock having a Fair Market Value equal to the minimum statutory amount required
by the Company or the applicable Affiliate to be withheld and paid to any such federal, state, or local taxing authority with respect
to such exercise, vesting, lapse of restrictions, or payment of shares of Stock; provided, however, for so long as Accounting Standards
Update 2016-09 or a similar rule remains in effect, the Board or the Committee has full discretion to choose, or to allow a Grantee
to elect, to withhold a number of shares of Stock having an aggregate Fair Market Value that is greater than the applicable minimum
required statutory withholding obligation (but such withholding may in no event be in excess of the maximum required statutory
withholding amount(s) in such Grantee’s relevant tax jurisdictions).

 

		18.4	Captions.

 

The use of captions
in the Plan or any Award Agreement is for convenience of reference only and shall not affect the meaning of any provision of the
Plan or such Award Agreement.

 

		18.5	Construction.

 

Unless the context
otherwise requires, all references in the Plan to “including” shall mean “including without limitation.”

 

		18.6	Other Provisions.

 

Each Award granted
under the Plan may contain such other terms and conditions not inconsistent with the Plan as may be determined by the Committee,
in its sole discretion.

 

		18.7	Number and Gender.

 

With respect to
words used in the Plan, the singular form shall include the plural form, and the masculine gender shall include the feminine gender,
as the context requires.

 

		18.8	Severability.

 

If any provision
of the Plan or any Award Agreement shall be determined to be illegal or unenforceable by any court of law in any jurisdiction,
the remaining provisions hereof and thereof shall be severable and enforceable in accordance with their terms, and all provisions
shall remain enforceable in any other jurisdiction.

 

		18.9	Governing Law.

 

The validity and
construction of the Plan and the instruments evidencing the Awards hereunder shall be governed by, and construed and interpreted
in accordance with, the laws of the State of Delaware, other than any conflicts or choice of law rule or principle that might otherwise
refer construction or interpretation of the Plan and the instruments evidencing the Awards granted hereunder to the substantive
laws of any other jurisdiction.

 

    	 	34	 

     

    

 

		18.10	Section 409A of the Code.

 

(a)          The
Plan is intended to comply with Code Section 409A to the extent subject thereto, and, accordingly, to the maximum extent permitted,
the Plan will be interpreted and administered to be in compliance with Code Section 409A. Any payments described in the Plan that
are due within the Short-Term Deferral Period will not be treated as deferred compensation unless Applicable Laws require otherwise.
Notwithstanding any provision of the Plan to the contrary, to the extent required to avoid accelerated taxation and tax penalties
under Code Section 409A, amounts that would otherwise be payable and benefits that would otherwise be provided pursuant to the
Plan during the six (6)-month period immediately following the Grantee’s Separation from Service will instead be paid on
the first payroll date after the six (6)-month anniversary of the Grantee’s Separation from Service (or the Grantee’s
death, if earlier).

 

(b)          Furthermore,
notwithstanding anything in the Plan to the contrary, in the case of an Award that is characterized as deferred compensation under
Code Section 409A, and pursuant to which settlement and delivery of the cash or shares of Stock subject to the Award is triggered
based on a Corporate Transaction, in no event will a Corporate Transaction be deemed to have occurred for purposes of such settlement
and delivery of cash or shares of Stock if the transaction is not also a “change in the ownership or effective control of”
the Company or “a change in the ownership of a substantial portion of the assets of” the Company as determined under
Treasury Regulation Section 1.409A-3(i)(5) (without regard to any alternative definition thereunder). If an Award characterized
as deferred compensation under Code Section 409A is not settled and delivered on account of the provision of the preceding
sentence, the settlement and delivery shall occur on the next succeeding settlement and delivery triggering event that is a permissible
triggering event under Code Section 409A. No provision of this paragraph shall in any way affect the determination of a Corporate
Transaction for purposes of vesting in an Award that is characterized as deferred compensation under Code Section 409A.

 

(c)          Notwithstanding
the foregoing, neither the Company nor the Committee will have any obligation to take any action to prevent the assessment of any
excise tax or penalty on any Grantee under Code Section 409A, and neither the Company or an Affiliate nor the Board or the Committee
will have any liability to any Grantee for such tax or penalty.

 

    	 	35Exhibit 10.2

 

 

 

AMERICAN PUBLIC EDUCATION, INC.

 

EXECUTIVE SEVERANCE PLAN

 

 

 

 

 

 

 

 

 

 

     

     

    

 

AMERICAN PUBLIC EDUCATION, INC.

 

EXECUTIVE SEVERANCE PLAN

 

 

Effective May 12, 2017

 

 

ARTICLE I  

PURPOSE AND TERM

 

1.1.           
 Purpose. American Public Education, Inc. (the “Company”) hereby establishes this Executive Severance
Plan (the “Plan”) to provide certain executive employees with severance benefits designed to mitigate the effects
of unemployment in the event that their employment is involuntarily terminated by the Company. The Company intends that this Plan
qualify as, and come within the various exceptions and exemptions under the Employee Retirement Income Security Act of 1974, as
amended (“ERISA”) for, an unfunded plan maintained primarily for a select group of management or highly compensated
employees, and any ambiguities in this Plan shall be construed to effect that intent.

 

1.2.           
Term. The Plan shall be effective as of the Effective Date, subject to amendment from time to time in accordance
with Section 9.1. The Plan shall continue until terminated pursuant to Section 9.1 of the Plan.

 

ARTICLE II  

DEFINITIONS

 

Wherever used herein,
the following terms have the following meanings unless the context clearly requires a different meaning:

 

2.1             
“Accrued Amounts” means any of the following:

 

(a) any unpaid Base Salary,
accrued vacation pay, and unreimbursed business expenses owed to the Participant through the date of such Participant’s termination
of employment; and

 

(b) any benefits provided
under the Company’s employee benefit plans upon or following a termination of employment, in accordance with the terms of
such plans.

 

2.2             
“Affiliate” means any corporation (other than the Company) or non-corporate entity that controls, is
controlled by, or is under common control with the Company within the meaning of Rule 405 of Regulation C under the Securities
Act.

 

2.3                
“Base Salary” means the amount a Participant is entitled to receive as wages or salary on an annualized
basis as in effect from time to time, without reduction for any pre-tax contributions to benefit plans. Base Salary does not include
bonuses, commissions, overtime pay or income from stock options, stock grants or other incentive or equity compensation.

 

 

    Page 2 of 11 

     

    

 

2.4                
“Board” means the Board of Directors of the Company.

 

2.5                
“Cause” means, with respect to any Participant and as determined by the Committee, (a) gross negligence
or willful misconduct in connection with the performance of duties; (b) conviction of, or pleading guilty or nolo contendere
to, a criminal offense (other than minor traffic offenses); or (c) material breach of any term of any employment, consulting
or other services, confidentiality, intellectual property, or non-competition agreements, if any, between such Participant and
the Company or an Affiliate.

 

2.6             
“Change in Control” means the occurrence of any of the following:

 

(a)          the dissolution or liquidation of the Company or a merger, consolidation, or reorganization of the Company with one or more
other entities in which the Company is not the surviving entity;

 

(b)          a sale of substantially all of the assets of the Company to another person (within the meaning of Sections 13(d) and 14(d)(2)
of the Exchange Act); or

 

(c)          any transaction (including without limitation a merger or reorganization in which the Company is the surviving entity) which
results in any person owning 50% or more of the combined voting power of all classes of common stock of the Company.

 

The Board
shall have full and final authority, in its sole discretion, to determine conclusively whether a Change in Control has occurred
pursuant to the above definition, the date of the occurrence of such Change in Control, and any incidental matters relating thereto.

 

2.7             
“COBRA” means the Consolidated Omnibus Budget Reconciliation Act of 1985.

 

2.8             
“Code” means the Internal Revenue Code of 1986, as amended, as now in effect or as hereafter amended,
and any successor thereto. References in the Plan to any Code Section shall be deemed to include, as applicable, regulations and
guidance promulgated under such Code Section.

 

2.9             
“Committee” means the Compensation Committee of the Board.

 

2.10         
“Company” means American Public Education, Inc., a Delaware corporation, and any successor thereto.

 

2.11         
“Disability” means the inability of a Participant to perform each of the essential duties of such Participant’s
position by reason of a medically determinable physical or mental impairment which is potentially permanent in character or which
can be expected to last for a continuous period of not less than twelve (12) months.

 

    Page 3 of 11 

     

    

 

2.12            
“Earned Bonus” means the bonus, if any, earned by a Participant with respect to the calendar year ending
on or preceding his or her Termination Date, to the extent not previously paid.

 

2.13            
“Effective Date” means May 12, 2007.

 

2.14            
“Employee” means any regular, full-time or part-time employee of the Company or an Affiliate.

 

2.15            
“Good Reason” means, as a reason for a Participant’s resignation from employment, the occurrence
of any of the following without the consent of the Participant:

 

		(a)	a material diminution in the Participant’s authority, duties or responsibilities;

 

		(b)	a material reduction in the Participant’s Base Salary; or

 

		(c)	a material change in the geographic location at which the Participant must perform services (it
being agreed that for purposes of this Plan, a required relocation of the Participant’s principal place of employment of
more than 50 miles shall be material).

 

A termination
by the Participant shall not constitute termination for Good Reason unless the Participant shall have first delivered to the Company
written notice setting forth with specificity the occurrence deemed to give rise to a right to terminate for Good Reason (which
notice must be given no later than 30 days after the initial occurrence of such event), the Company shall have failed to correct,
rescind or otherwise substantially reverse the occurrence supporting termination for Good Reason identified by the Participant
within 30 days after receiving such written notice from the Participant, and the Participant shall actually terminate employment
within 60 days following the Company’s failure to correct the occurrence supporting termination for Good Reason.

 

2.16         
“Participant” has the meaning set forth in Section 3.1.

 

2.17         
“Plan” means this American Public Education, Inc. Executive Severance Plan, as amended from time to time.

 

2.18         
“Prorated Annual Bonus” means the product of (i) the annual cash bonus, if any, that the Participant
would have earned for the entire calendar year in which the Termination Date occurs based on the actual level of achievement of
any company performance goals for such year and the higher of the actual or target level of achievement of any individual performance
goals for such year; and (ii) a fraction, the numerator of which is the number of days the Participant was employed by the Company
during the calendar year in which the Termination Date occurs and the denominator of which is the number of days in such year.

 

2.19            
“Termination Date” means the date of the termination of a Participant’s employment with the Company
as determined in accordance with Section 8.2.

 

    Page 4 of 11 

     

    

 

ARTICLE III  

PARTICIPATION

 

 

3.1                
Employees of the Company at the Senior Vice President level and above or comparably situated employees of the Company’s
subsidiaries, in each case who are designated for participation in the Plan by the Committee from time to time, shall participate
in the Plan (each a “Participant,” and collectively, the “Participants”).

 

ARTICLE IV

SEVERANCE BENEFITS

 

4.1                
Termination Without Cause or for Good Reason. If a Participant’s employment with the Company is terminated
by the Company without Cause or by the Participant for Good Reason, the Participant shall be entitled to receive the Accrued Amounts
and the Earned Bonus. In addition, and subject to the terms and conditions of Section 5.2, the Participant shall be entitled to
receive the following severance payments:

 

(a)          An amount equal to the sum of the Participant’s Base Salary in effect immediately prior to the Termination Date, payable
for a 12-month period beginning on the 61st day following the Termination Date, in accordance with Company’s normal payroll
practices, plus, the Participant’s Prorated Annual Bonus, paid on the date that annual bonuses are paid to the Company’s
executives, or, if later, the 61st day following the Termination Date; and

 

(b)          An amount, determined in the sole discretion of the Committee, equal to 12 times the difference between (x) the monthly
COBRA premium paid by the Participant for group health plan coverage for the Participant and, if applicable, the Participant’s
eligible dependents and (y) the monthly premium amount paid by the Participant immediately prior to the Termination Date for the
same coverage, payable in a single lump sum on the 61st day following the Termination Date.

 

4.2                
Termination Without Cause or for Good Reason in connection with a Change in Control. If a Participant’s employment
with the Company is terminated by the Company without Cause or by the Participant for Good Reason, in either case, within six months
following a Change in Control, the Participant shall be entitled to receive the Accrued Amounts and the Earned Bonus. In addition,
and subject to the terms and conditions of Section 5.2, the Participant shall be entitled to receive the following severance payments:

 

(a)          An amount equal to the 1.5 times the sum of the Participant’s Base Salary in effect immediately prior to the Termination
Date, plus the Participant’s target annual bonus for the year in which the Termination Date occurs, payable in a single lump
sum on the 61st day following the Termination Date; provided, however, that if the Change in Control is not a “change
in control event” within the meaning of Section 409A of the Code, payments will be made in accordance with the timing set
forth in Section 4.1(a); and

 

    Page 5 of 11 

     

    

 

(b)          An amount, determined in the sole discretion of the Committee, equal to 18 times the difference between (x) the monthly
COBRA premium paid by the Participant for group health plan coverage for the Participant and, if applicable, the Participant’s
eligible dependents and (y) the monthly premium amount paid by the Participant immediately prior to the Termination Date for the
same coverage, payable in a single lump sum on the 61st day following the Termination Date.

 

4.3                
Termination Due to Disability or Death. If a Participant’s employment with the Company is terminated due to
Disability or death, the Company will pay the Accrued Amounts and the Earned Bonus to the Participant or his or her designated
beneficiaries (or, if there are no such designated beneficiaries, to the Participant’s estate), respectively.

 

4.4                
Termination for Cause or Without Good Reason. If a Participant’s employment with the Company is terminated
by the Company for Cause or by the Participant without Good Reason, the Company will pay the Participant the Accrued Amounts and
the Earned Bonus. The Company will have no further obligations to such Participant under this Plan.

 

4.5             
Equity Awards. The Plan does not affect the terms of any outstanding equity awards. The treatment of any outstanding
equity awards shall be determined in accordance with the terms of the Company equity plan or plans under which they were granted
and any applicable award agreements.

 

4.6             
No Mitigation. In no event shall the Participant be obligated to seek other employment or take any other action by
way of mitigation of the amounts payable to the Participant under any provisions of this Plan, and such amounts shall not be reduced
whether or not the Participant obtains other employment.

 

ARTICLE V

RESTRICTIVE COVENANTS; CONDITIONS TO SEVERANCE 

 

5.1             
Restrictive Covenants. During a Participant’s employment with the Company or an Affiliate and for a period
of 12 months following the Termination Date, the Participant will not, (a) in the United States or any other jurisdiction in which
the Company or an Affiliate is engaged or has reasonably firm plans to engage in business, whether as a principal, investor, employee,
consultant, independent contractor, officer, director, board member, manager, partner, agent, or otherwise, alone or in association
with any other person, firm, corporation, or business organization, work for, become employed by, engage in, carry on, provide
services to, or assist in any manner (whether or not for compensation or gain) a person or entity that engages in any business
in which the Company or an Affiliate is engaged (a “Competing Business”), where the Participant’s position
or service for such Competing Business relates to the Participant’s positions with or the types of services performed by
the Participant for the Company or an Affiliate, or is otherwise competitive with the Company’s or an Affiliate’s products
or services; provided, however, that the foregoing will not prohibit the Participant from (i) serving on a board of directors (or
comparable bodies) of other entities where the Company has given prior permission, (ii) following the Termination Date, being employed
by (A) a campus-based institution of higher education that derives no more than twenty percent (20%) of its revenues from online
education, provided, that the Participant is not predominantly engaged in supporting the online education, or (B) an online learning
company that does not provide higher education, or (iii) serving as a faculty member, “scholar in residence” or similar
academic position, provided, that the Participant does not engage in administrative matters, other than to a de minimis extent.
Notwithstanding the preceding sentence, the Participant may directly or indirectly own, solely as an investment, less than one
percent (1%) of the outstanding stock of any corporation listed on a national securities exchange. In addition, during a Participant’s
employment with the Company or its Affiliate and for 12 months following the Termination Date, the Participant will not solicit,
induce, entice, or encourage or attempt to solicit, induce, entice, or encourage any employee of the Company or an Affiliate to
render services for any other person, firm, entity, or corporation or to terminate his or her employment with the Company or an
Affiliate.

 

    Page 6 of 11 

     

    

 

If a judicial determination
is made by a court of competent jurisdiction that any restriction contained in this Section 5.1 is unenforceable against a Participant,
the provisions of this Section 5.1 shall not be rendered void but shall be deemed amended to apply as to the maximum extent as
such court may judicially determine or indicate to be enforceable. Alternatively, if any court of competent jurisdiction finds
that any restriction contained in this Section 5.1 is unenforceable, and such restriction cannot be amended so as to make it enforceable,
such finding shall not affect the enforceability of any of the other restrictions contained herein

 

5.2          
Conditions to Severance. Notwithstanding any provision herein to the contrary, the Company’s payment of any
severance amount pursuant to Sections 4.1 and 4.2 (other than the Accrued Amounts and the Earned Bonus) to a Participant shall
be conditioned upon (i) the Participant’s compliance with the obligations set forth in Section 5.1 hereof, (ii) the Participant
executing a release of claims in favor of the Company, its Affiliates and their respective officers and directors in a form provided
by the Company (the “Release”) and such Release becoming effective and irrevocable within 60 days following
the Participant's Termination Date; and (iii) with respect to the amounts in Sections 4.1(b) and 4.2(b) only, the Participant timely
and properly electing continuation coverage under COBRA.

 

ARTICLE VI

REDUCTION OF PAYMENTS

 

6.1             
In the event that it is determined that any payment, distribution or benefit made by the Company, any Affiliate or any person
who acquires ownership or effective control or ownership of a substantial portion of the Company’s assets (within the meaning
of Section 280G of the Code) or by any affiliate of such person, whether paid or payable or distributed or distributable pursuant
to the terms of this Plan or otherwise (the “Total Payments”), would be subject to the excise tax imposed by
Section 4999 of the Code or any interest or penalties with respect to such excise tax (such excise tax, together with any such
interest or penalties, are collectively referred to as the “Excise Tax”), then the payments due under this Agreement
shall be reduced so that the Total Payments will not result in the imposition of such Excise Tax. Notwithstanding the foregoing,
if (x) the Total Payments exceed three (3) times the Participant’s “base amount” as defined within Section 280G
and (y) the Participant would receive at least $50,000 more on a net after-tax basis if the Total Payments were not reduced pursuant
to this section (after payment of the Excise Tax), then the Company will not reduce the Total Payments and the Participant shall
be responsible for the Excise Tax related thereto. For purposes of determining the net after-tax benefit, the Participant shall
be deemed to pay federal income taxes at the highest marginal rate of the federal income taxation applicable to individuals (without
taking into account surtaxes or loss or reduction of deductions) for the calendar year in which the Termination Date occurs and
state and local income taxes at the highest marginal rates of taxation in the state and locality of the Participant’s residence
on the Termination Date.

 

    Page 7 of 11 

     

    

 

6.2                
If the Company is required under Section 6.1 to reduce the Total Payments, the payment reduction shall be implemented by
determining the “Parachute Payment Ratio” (as defined below) for each “parachute payment” within
the meaning of Section 280G of the Code, and then reducing the “parachute payments” in order beginning with the “parachute
payment” with the highest Parachute Payment Ratio. For “parachute payments” with the same Parachute Payment Ratio,
such “parachute payments” shall be reduced based on the time of payment of such “parachute payments” with
amounts having later payment dates being reduced first. For “parachute payments” with the same Parachute Payment Ratio
and the same time of payment, such “parachute payments” shall be reduced on a pro rata basis (but not below zero) prior
to reducing “parachute payments” with a lower Parachute Payment Ratio. For purposes hereof, the term “Parachute
Payment Ratio” shall mean a fraction the numerator of which is the value of the applicable “parachute payment”
for purposes of Section 280G of the Code and the denominator of which is the intrinsic value of such “parachute payment.”
For purposes of determining whether any of the Total Payments will be subject to the Excise Tax and the amount of such Excise Tax,
(A) the entire amount of the Total Payments shall be treated as “parachute payments” within the meaning of Code Section
280G(b)(2) and as subject to the Excise Tax, unless and to the extent, in the written opinion of the Company’s independent
accountants, such payments (in whole or in part) are not subject to the Excise Tax; and (B) the value of any noncash benefits or
any deferred payment or benefit (constituting a part of the Total Payments) shall be determined by the Company’s independent
auditors in accordance with the principles of Code Sections 280G(d)(3) and (4).

 

ARTICLE VII

CLAIMS AND APPEAL PROCEDURES

 

7.1                
Claims Procedures. Severance payments under the Plan will be automatically paid to a Participant who qualifies for
such benefits and satisfies the conditions in Section 5.2. A Participant who believes he or she is entitled to severance payments
under this Plan and has not been provided such benefits must file a written claim for such benefits with the Committee. The Committee
shall render a written decision concerning the claim not later than 90 days after its receipt, unless special circumstances require
an extension of time for processing the claim, in which case a decision will be rendered not later than 120 days after receipt
of the claim. Written notice of the extension will be furnished to the Participant prior to the expiration of the initial 90-day
period and will indicate (i) the special circumstances requiring an extension of time for processing the claim, and (ii) the date
the Committee expects to render its decision. For purposes of this Section 7.1, any payment of severance under this Plan shall
be treated as the issuance of a written decision by the Committee to approve the claim for benefits.

 

If the claim is denied,
in whole or in part, such decision shall include (i) the specific reasons for the denial; (ii) a reference to the Plan provision(s)
constituting the basis of the denial; (iii) a description of any additional material or information necessary for the Participant
to perfect his claim; (iv) an explanation as to why such additional material or information is necessary; and (v) a description
of how the claim review procedure is administered. If the notice of denial is not furnished in accordance with the above procedure,
then the claim shall be deemed denied and the Participant may appeal the decision.

 

    Page 8 of 11 

     

    

 

7.2                
Appeal Procedure. If the Participant’s claim is denied, in whole or in part, he then has 60 days to appeal
the decision. An appeal must be submitted in writing to the Committee. The Participant may also submit a written request to review
copies of the pertinent Plan documents in connection with his appeal. The review of the appeal shall be conducted by the Committee,
which shall afford the Participant a hearing, and which shall render a decision in writing within 60 days of a request for review,
provided that if the Committee determines prior to the end of such 60-day review period that special circumstances require an extension
of time for review of the appeal, the period for review on the appeal shall be extended by an additional 60 days. The Participant
shall receive written notice of the Committee’s decision on the appeal, together with specific reasons for the decision and
reference to the pertinent provisions of the Plan.

 

7.3             
Exhaustion of Administrative Remedies. No action may be brought for severance payments provided under the Plan, or
to enforce any right thereunder, until a claim has been submitted and the appeal rights under the Plan have been exhausted.

 

ARTICLE VIII

NOTICE; TERMINATION DATE

 

8.1                
Written Notice Required. Any purported termination of employment by the Company shall be communicated by written
notice to the Participant at least 15 days prior to the effective date of such termination of employment, and any purported termination
of employment by the Participant shall be communicated by written notice to the Company at least 60 days prior to the effective
date of such termination of employment (each, a “Notice of Termination”). The failure of the Company or the
Participant to set forth in the Notice of Termination any fact or circumstance which contributes to a showing of Cause or Good
Reason shall not waive any right of the Company or the Participant, respectively, hereunder or preclude the Company or the Participant,
respectively, from asserting such fact or circumstance in enforcing the Company’s or the Participant’s rights hereunder.

 

8.2                
Termination Date. In the case of the Participant’s death, the Participant’s Termination Date shall be
his or her date of death. In all other cases, the Participant’s Termination Date shall be the date specified in the Notice
of Termination, but in no event will such date be prior to the date on which the required notice periods set forth in Section 8.1
have elapsed.

 

    Page 9 of 11 

     

    

 

ARTICLE IX

MISCELLANEOUS

 

9.1                
Amendment and Termination. The Committee or the Board may amend or terminate the Plan at any time it may deem advisable
without the consent of any person or entity, which shall automatically effect a corresponding amendment to, or termination of,
a Participant’s rights and benefits hereunder; provided that any termination of the Plan shall not become effective until
twelve months after the date of the Committee’s or the Board’s action to terminate the Plan; and, provided further,
that if any Participant becomes entitled to severance payments during such 12-month period, the Plan shall continue in full force
and effect and shall not terminate with respect to such Participants until after all such Participants have received their severance
payments in full. The form of any amendment or termination of the Plan shall be a written instrument signed by a duly authorized
officer or officers of the Company, certifying that the amendment or termination has been approved by the Committee of the Board.

 

9.2             
Administration and Committee Powers. The general administration of the Plan and the duty to carry out its provisions
shall be vested in the Committee. The Committee shall administer the Plan and any severance payments provided under the Plan. The
Committee may, in its discretion, secure the services of other parties, including agents and/or employees to carry out the day-to-day
functions necessary to an efficient operation of the Plan. The Committee shall have the exclusive, discretionary right to interpret
the terms of the Plan, to determine eligibility for participation and the amount of payments, and to make such other determinations
and to exercise such other powers and responsibilities as shall be provided for in the Plan or shall be necessary or helpful with
respect thereto. The decision of the Committee on any disputes arising under the Plan, including (but not limited to) questions
of construction, interpretation and administration shall be final, conclusive and binding on all persons having an interest in
or under the Plan. Any determination made by the Committee shall be given deference in the event the determination is subject to
judicial review and shall be overturned by a court of law only if it is arbitrary and capricious.

 

9.3             
Withholding of Taxes. The Company shall have the authority and right to withhold an amount sufficient to satisfy
federal, state, local and foreign taxes required by law to be withheld with respect to any payments or benefits under the Plan.

 

9.4                
Section 409A.

 

(a)          The Plan is intended to comply with Section 409A of the Code or an exemption thereunder and shall be construed and administered
in accordance with Section 409A of the Code. Notwithstanding any other provision of the Plan, payments provided under the Plan
may only be made upon an event and in a manner that complies with Section 409A of the Code or an applicable exemption. Any payments
under the Plan that may be excluded from Section 409A of the Code either as separation pay due to an involuntary separation from
service or as a short-term deferral shall be excluded from Section 409A of the Code to the maximum extent possible. For purposes
of Section 409A of the Code, each installment payment provided under the Plan shall be treated as a separate payment. Any payments
to be made under the Plan upon a termination of employment shall only be made upon a “separation from service” under
Section 409A of the Code. Notwithstanding the foregoing, the Company makes no representations that the payments and benefits provided
under the Plan comply with Section 409A of the Code and in no event shall the Company be liable for all or any portion of any taxes,
penalties, interest, or other expenses that may be incurred by a Participant on account of non-compliance with Section 409A of
the Code.

 

    Page 10 of 11 

     

    

 

(b)          Notwithstanding any other provision of the Plan, if any amount or benefit payable to a Participant under this Plan is determined
to constitute “nonqualified deferred compensation” within the meaning of Section 409A of the Code during a period in
which the Participant qualifies as a “specified employee” as defined in Section 409A of the Code, then (subject to
any permissible acceleration of payment under Section 409A of the Code): (i) the amount of such nonqualified deferred compensation
that would otherwise be payable during the six-month period immediately following the Participant’s separation from service
under the terms of this Plan will be accumulated through and paid or provided on the first day of the seventh month following the
Participant’s separation from service (or, if the Participant dies during such period, within 30 days after the Participant’s
death) (in either case, the “Required Delay Period”); and (ii) the normal payment or distribution schedule for
any remaining payments or distributions will resume at the end of the Required Delay Period.

 

9.5                
Employment Status. This Plan does not constitute a contract of employment or impose on the Company any obligation
to retain the Participant as an Employee, to change the status of the Participant’s employment, or to change the Company’s
policies regarding termination of employment.

 

9.6                
Unfunded Plan. Any severance amounts payable under the Plan shall be paid from the general assets of the Company,
and Participants and any other person who may have rights hereunder shall be unsecured general creditors of the Company with respect
to such amounts.

 

9.7             
Successors. This Plan shall inure to the benefit of and shall be binding upon the Company and its successors and
assigns. Any successor (whether direct or indirect and whether by purchase, lease, merger, consolidation, liquidation or otherwise)
to all or substantially all of the Company’s business and/or assets shall assume and agree to perform the obligations of
the Company under this Plan.

 

9.8             
Assignment. The Plan shall inure to the benefit of and be enforceable by each Participant’s personal or legal
representatives, executors, administrators, successors, heirs, distributees, devisees, legatees or other beneficiaries. If a Participant
should die while any amount remains payable to such Participant hereunder, all such amounts shall be paid to the executors, personal
representatives or administrators of such Participant’s estate. A Participant’s rights under this Plan shall not otherwise
be transferable or subject to lien or attachment.

 

9.9                
Validity and Severability. If any provision of the Plan is held invalid or unenforceable, its validity or unenforceability
shall not affect any other provisions of the Plan, and the Plan shall be construed and enforced as if such provision had not been
included herein.

 

9.10            
Governing Law. The Plan shall be construed and interpreted in accordance with the laws of the State of West Virginia
without reference to the conflict of laws provisions thereof, to the extent not preempted by federal law, which shall otherwise
control.

 

    Page 11 of 11

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