Document:

exv10w9w4

 

Exhibit 10.9.4

SCHEDULE OF PROMISSORY NOTES

Containing Provisions Set Forth in Forms of Promissory Note

Filed as Exhibit 10.9.2 and Exhibit 10.9.3

	 	 	 	 	 	 	 	 	 	 	 	 	 
	Promissory Note No.	 	Type of Promissory Note	 	Date of Issuance	 	Principal Amount	 	Interest Rate
	1

	 	Equipment
	 	March 30, 2005
	 	$	1,601,828.65	 	 	 	10.65	%
	2

	 	Computers and
Software
	 	March 30, 2005
	 	$	513,384.10	 	 	 	10.65	%
	3

	 	Equipment
	 	May 4, 2005
	 	$	833,152.88	 	 	 	10.30	%
	4

	 	Computers and
Software
	 	May 4, 2005
	 	$	119,989.15	 	 	 	10.30	%
	5

	 	Equipment
	 	June 27, 2005
	 	$	127,664.50	 	 	 	10.23	%
	6

	 	Computers and
Software
	 	June 27, 2005
	 	$	63,560.15	 	 	 	10.23	%exv10w1

 

Exhibit 10.1

Fiscal Year 2006

Executive Bonus Agreement

Pursuant to the 2003 Performance Award Plan

July 1, 2005 — June 30, 2006

 

	 	 	 
	Name: [Insert Name]

	 	Job Title: [Insert Job Title]
	Effective Date: [Insert Effective Date]

	 	 
	Target Bonus: [Insert]% of Annual Base Pay

	 	Employee ID: [Insert Number]

 

INTRODUCTION

This guide provides a summary of the Executive Bonus Plan for July 1, 2005 — June 30, 2006.

The plan provides a lump-sum cash payment following the completion of fiscal year 2006 for
achievement of annual budgeted operating profit and other goals based on predetermined performance
and award schedules.

PERFORMANCE MEASURES

Plan participants are measured on the degree to which the company achieves its budgeted goals
during the fiscal year in the following areas:

“Core”

	 	•	 	Operating Profit

“Multipliers”

	 	•	 	Average Monthly Student Attrition
	 
	 	•	 	Annual Student Placement
	 
	 	•	 	Average Student Satisfaction Score on most recent survey

	•	 	Annual Total Employee Turnover
	 
	•	 	Average Compliance Score on annual compliance audit, as remediated

AWARD DETERMINATION AND SIZE OF AWARDS

The plan operates under a “target award” framework, where participants have a bonus target as a
percentage of base pay, and earn awards based on the degree to which performance goals are
achieved. Target and Maximum awards are:

	 	 	 
	Award as % of
	Annual Base Pay
	Target	 	Maximum
	[Insert]%
	 	[Insert]%

Award calculation is based on a percentage of a participant’s annual base salary in effect at the
end of the fiscal year (or, if the participant transfers to another job within the company during
the fiscal year, the end of the participant’s employment in this job, as applicable).

1. Award Schedules

	 	•	 	A plan participant may receive an award for achievement of specific Operating Profit
performance goals measured at the end of the fiscal year. We refer to the Operating Profit
achievement as the “core” component of the bonus. This “core” component is modified based
on achievement of specific “multiplier” performance goals to add to or subtract from the
“core” award as specified in the charts below.

 

1 of 3

 

Fiscal Year 2006

Executive Bonus Agreement

Pursuant to the 2003 Performance Award Plan

July 1, 2005 — June 30, 2006

[Insert Job Title]

 

	 	•	 	Core Performance Measure:

	 	 	 	 	 	 	 
	 	 	% of Operating Profit	 	% of Target	 	Award as % of
	 	 	Goal Achieved	 	Award Earned	 	Annual Base Pay
	Maximum
	 	≥ 120.0%	 	140.0%	 	[157.5]%
	 
	 	116.0%	 	132.0%	 	[130.1]%
	 
	 	112.0%	 	124.0%	 	[125.7]%
	 
	 	108.0%	 	116.0%	 	[121.3]%
	 
	 	104.0%	 	108.0%	 	[116.9]%
	Target
	 	100.0%	 	100.0%	 	[112.5]%
	 
	 	98.0%	 	83.3%	 	[45.83]%
	 
	 	96.0%	 	66.7%	 	[36.67]%
	 
	 	94.0%	 	50.0%	 	[27.50]%
	 
	 	92.0%	 	33.3%	 	[18.33]%
	 
	 	90.0%	 	16.7%	 	[9.167]%
	 
	 	< 90.0%	 	0.0%	 	[0.00]%

	 	•	 	Multipliers:

	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Student Attrition	 	 	Student Placement	 	 	Student Satisfaction	 	 	Employee Turnover	 	 	Compliance Score	 
	Variance	 	Award	 	 	 	 	Award	 	 	Survey	 	Award	 	 	 	 	Award	 	 	 	 	Award	 
	from Budget	 	Multiplier	 	 	Actual %	 	Multiplier	 	 	Score	 	Multiplier	 	 	Actual %	 	Multiplier	 	 	Score	 	Multiplier	 
	≤
	 	 	8.57	%	 	≥	 	 	8.57	%	 	≥	 	 	8.57	%	 	≤	 	 	8.57	%	 	≤	 	 	8.57	%
	 
	 	 	6.86	%	 	 	 	 	6.86	%	 	 	 	 	6.86	%	 	 	 	 	6.86	%	 	 	 	 	6.86	%
	 
	 	 	5.14	%	 	 	 	 	5.14	%	 	 	 	 	5.14	%	 	 	 	 	5.14	%	 	 	 	 	5.14	%
	 
	 	 	3.43	%	 	 	 	 	3.43	%	 	 	 	 	3.43	%	 	 	 	 	3.43	%	 	 	 	 	3.43	%
	 
	 	 	1.71	%	 	 	 	 	1.71	%	 	 	 	 	1.71	%	 	 	 	 	1.71	%	 	 	 	 	1.71	%
	 
	 	 	0.00	%	 	 	 	 	0.00	%	 	 	 	 	0.00	%	 	 	 	 	0.00	%	 	 	 	 	0.00	%
	 
	 	 	-2.50	%	 	 	 	 	-2.50	%	 	 	 	 	-2.50	%	 	 	 	 	-2.50	%	 	 	 	 	-20.00	%
	 
	 	 	-5.00	%	 	 	 	 	-5.00	%	 	 	 	 	-5.00	%	 	 	 	 	-5.00	%	 	 	 	 	-40.00	%
	 
	 	 	-7.50	%	 	 	 	 	-7.50	%	 	 	 	 	-7.50	%	 	 	 	 	-7.50	%	 	 	 	 	-60.00	%
	 
	 	 	-10.00	%	 	 	 	 	-10.00	%	 	 	 	 	-10.00	%	 	 	 	 	-10.00	%	 	 	 	 	-80.00	%
	≥
	 	 	-12.50	%	 	≤	 	 	-12.50	%	 	≤	 	 	-12.50	%	 	≥	 	 	-12.50	%	 	≥	 	 	-100.00	%

	 	•	 	“Core” and “multiplier” awards for performance between levels shown are calculated using interpolation between points.

2. Example

	 	•	 	Following calculation of the “core” award, the company’s performance on each of the
“multipliers” will be used to calculate an increase or reduction to/from the “core” award
based on award “multipliers.” The total cash award is calculated by adding or subtracting
each “multiplier” to/from the “core” award. For instance, assume the following:
	 
	 	 	 	$150,000 in Annual Base Pay

	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	"Core" Performance Measure	 	"Multiplier" Performance Measures	 	 	 	 
	 	 	% Operating	 	Award	 	 	 	 	 	Variance,	 	 	 	 	 	 	 	 	 	 
	Performance	 	Profit	 	as % of	 	 	 	 	 	Actual %,	 	Award	 	 	 	 	 	 	 	 
	Measurement	 	Goal	 	Base	 	 	 	 	 	or	 	Multiplier	 	 	 	 	 	 	Total	 
	Period	 	Achieved	 	Pay	 	Award $	 	"Multiplier"	 	Score	 	x "Core"	 	 	Award $	 	 	Award $	 
	Fiscal Year
	 	[108.0]%	 	[121.30]%	 	$181,950	 	Student Attrition	 	 	 	 	3.43	%	 	$	6,241	 	 	 	 	 
	 
	 	 	 	 	 	 	 	Student Placement	 	 	 	 	-2.50	%	 	-$	4,549	 	 	 	 	 
	 
	 	 	 	 	 	 	 	Student Satisfaction	 	 	 	 	3.43	%	 	$	6,241	 	 	 	 	 
	 
	 	 	 	 	 	 	 	Employee Turnover	 	 	 	 	5.14	%	 	$	9,352	 	 	 	 	 
	 
	 	 	 	 	 	 	 	Compliance Score	 	 	 	 	0.00	%	 	$	0	 	 	 	 	 
	“Core” Award
	 	 	 	[121.30]%	 	$181,950	 	Total "Multiplier" Award	 	 	 	 	9.50	%	 	$	17,285	 	 	$	199,235	 

“Core” Award = 121.3% of Base Pay, or $181,950.

Total “Multiplier” Award = 9.50% of “Core” Award, or $17,285.

Total Award = $181,950 plus $17,285 equals $199,235 or 132.8% of Base Pay.

In this example, the participant would receive a “core” award of $181,950, plus and minus
each of the award multipliers ($6,241, -$4,549, $6,241, $9,352, and $0) for a total award of
$199,235.

 

2 of 3

 

Fiscal Year 2006

Executive Bonus Agreement

Pursuant to the 2003 Performance Award Plan

July 1, 2005 — June 30, 2006

[Insert Job Title]

 

	3.	 	Pro-Ration of Goals, Performance and Awards. If an employee starts in the position after the
start of the fiscal year or leaves the position before the end of the fiscal year but remains
employed by the company, goals and performance will be based on the full fiscal year, but
awards will be pro-rated based on the number of full calendar months the employee is in the
position.
	 
	4.	 	Regulatory Compliance Performance “Gate.” If the schools within the company receive an
average compliance audit score of greater than or equal to [Insert] after giving effect to the 60-day
remediation period, then the participant will forfeit the entire award, including “multiplier”
awards, regardless of performance in other areas.

OTHER INFORMATION

	•	 	Awards are paid within 90 days following the end of the fiscal year.
	 
	•	 	Plan participants must be employed at the time of award payout to receive an award payout.
	 
	•	 	Nothing in this document is to be construed to guarantee its continuation in any future years.
	 
	•	 	This document is not a contract and awards under the plan may be changed or canceled at the company’s discretion.
	 
	•	 	The company’s Board of Directors will make the final decision regarding any disputed bonus calculation or award.

REQUEST FOR PLAN PARTICIPANT SIGNATURE

Please sign and return this document to Corporate Human Resources.

	 	 	 
	

	 	 
	Employee Signature

	 	 
	[Insert Name]
	 	 
	 
	 	 
	

	 	 
	Senior Vice President and General Counsel
	 	 
	Stan Mortensen
	 	 

 

3 of 3exv10w2

 

Exhibit 10.2

The following is a summary description of the verbal arrangements with the Company’s
non-employee members of the Board of Directors regarding their compensation:

Each non-employee director shall be paid an annual fee of $25,000 for his or her services as a
director, and $1,500 for each Board of Directors meeting attended. Each member of the Compensation
Committee (other than the Chairperson) receives $1,500 for each Compensation Committee meeting
attended; the Chairperson of the Compensation Committee receives $4,000 for each Compensation
Committee meeting attended. Each member of the Audit Committee (other than the Chairperson)
receives $2,000 for each Audit Committee meeting attended; the Chairperson of the Audit Committee
receives $5,000 for each Audit Committee meeting attended. Each member of the Nominating and
Corporate Governance Committee (other than the Chairperson) receives $1,500 for each Nominating and
Corporate Governance Committee meeting attended; the Chairperson of the Nominating and Corporate
Governance Committee receives $3,000 for each Nominating and Corporate Governance Committee meeting
attended. All non-employee directors are reimbursed for their reasonable out-of-pocket expenses
incurred in attending Board of Directors meetings and committee meetings. New non-employee
directors elected or appointed at any time other than at the August Board meeting will receive an
initial pro-rated stock option grant in an amount equal to the product of (i) the percentage of the
year remaining until the next regularly scheduled August Board meeting, and (ii) 12,000. Each
non-employee director of the company automatically receives an annual grant of 12,000 options at
the August meeting of the Board. These stock options are granted at the then-current market price,
and vest immediately but will not be exercisable until the one-year anniversary of the grant date.

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