Document:

Exhibit 10.3

 EXHIBIT 10.3 
  

 
 October 29, 2017 

Mr. Andrew E. Watt 
 [Address]    

 Capella Education Company (“Capella”) has entered into an Agreement and Plan of Merger (the Merger Agreement) pursuant to which a wholly owned
subsidiary of Strayer Education, Inc. (“Strayer”) will merge with and into Capella pursuant to which Capella will become a wholly owned subsidiary of Strayer. In connection with the merger contemplated by the Merger Agreement (the Merger),
you will be offered to continue your employment as a Continuing Employee under the Merger Agreement. This letter agreement reflects certain understandings and agreements regarding certain of the terms of your employment as a Continuing Employee.

 You understand and agree that your job responsibilities with the combined company resulting from the Merger are expected to be substantially the same as
your current job responsibilities and will not constitute a material reduction in your job responsibilities as a Continuing Employee. You agree to remain employed as a Continuing Employee, notwithstanding any changes that may be made to your job
responsibilities, for a period of at least eighteen months following the closing of the Merger (the Closing), and you waive any rights you may have to resign for Good Reason and to receive benefits under the Capella Senior Executive Severance Plan,
as amended (the Plan), as a result of any reduction in your job responsibilities. For the sake of clarity, nothing in this letter agreement changes your eligibility for benefits under the Plan if you experience a material diminution of your base
compensation or a reassignment of your principal place of work, without your consent, to a location more than 50 miles from your principal place of work. 

In exchange for your commitment to remain employed as a Continuing Employee for eighteen months following the Closing, and as further inducement to you to
remain employed, you will be eligible for severance benefits comparable to the benefits under the Plan under certain circumstances. If you remain employed for the period from the date of the Closing through the date that is eighteen months following
the date of the Closing, you will be entitled to voluntarily resign from your employment other than for Good Reason, effective at any time from the date that is eighteen months following Closing until the second annual anniversary of the date of
Closing and, in connection with such resignation, receive benefits equal to the benefits that you would have been entitled to receive under Section IV of the Plan (as the Plan is in effect on the date of this letter agreement) if you had terminated
your employment for Good Reason under the Plan, subject to you fulfilling all of the same terms, conditions and requirements for receipt of benefits under the Plan, including without limitation the requirement that you timely sign and not revoke a
release of claims and the time and form of any severance payments. No benefits will be payable under this letter agreement for any termination of your employment following the second annual anniversary of the Closing. 

Nothing in this letter agreement is intended to amend the Plan or your participation in it. The benefit described in the previous paragraph is intended to be
an additional benefit available to you in the event your employment terminates under circumstances that would not otherwise qualify you for a benefit under the Plan during the period described above. Under no circumstances will you be eligible to
collect benefits under both this letter agreement and under the Plan, since the qualifying events for benefits under the Plan and under this letter agreement are mutually exclusive. 

 Mr. Andrew E. Watt 

October 29, 2017 
 Page 2 

 

 This letter agreement is intended to comply with section 409A of the Internal Revenue Code of 1986, as
amended (the Code) and its corresponding regulations, and payments may only be made under this letter agreement upon an event and in a manner permitted by section 409A of the Code, to the extent applicable. If required by section 409A of the Code,
if you are considered a “specified employee” for purposes of section 409A of the Code and if payment of any amounts under this letter agreement is required to be delayed for a period of six months after separation from service pursuant to
section 409A of the Code, payment of such amounts shall be delayed as required by section 409A of the Code, and the accumulated amounts shall be paid in a lump sum payment within ten days after the end of the
six-month period. All payments to be made upon a termination of employment under this letter agreement may only be made upon a “separation from service” under section 409A of the Code. In no event
may you, directly or indirectly, designate the calendar year of a payment. Notwithstanding any provision of this letter agreement to the contrary, in no event shall the timing of your execution of a release of claims, directly or indirectly, result
in you designating the calendar year of payment of any amounts of deferred compensation subject to section 409A of the Code, and if a payment that is subject to execution of a release could be made in more than one taxable year, payment shall be
made in the later taxable year. 
 This letter agreement does not modify the at-will employment relationship between
you and Capella before the Closing, or between you and Strayer after the Closing. Each of Capella and Strayer, as applicable, retain the right to terminate your employment, with or without notice, at any time and for any lawful reason or no reason.

 All matters relating to the interpretation and enforcement of this letter agreement will be governed by the laws of the State of Minnesota. This letter
agreement may not be assigned by you. 
 This letter agreement contains the entire agreement and understanding between you and Capella and Strayer with
respect to the matters discussed herein. This letter agreement may not be modified or amended except in a written amendment signed by you and an authorized representative of Capella before the Closing or an authorized representative of Strayer after
the Closing. 
 Sincerely, 
 /s/ J. Kevin Gilligan 

J. Kevin Gilligan 
 Chief Executive Officer 

Acknowledgment and Acceptance: 
 By signing below, I
accept and agree to the terms and conditions of this letter agreement as set forth above. 
  

					
	 Employee Signature:
	  	 /s/ Andrew E. Watt
	  	 Date: October 29, 2017Exhibit 10.4

 EXHIBIT 10.4 

AMENDMENT TO THE 

CAPELLA EDUCATION COMPANY 

SENIOR EXECUTIVE SEVERANCE PLAN 
 The
Capella Education Company Senior Executive Severance Plan (As Originally Effective September 11, 2006, and as Amended December 13, 2007 and August 14, 2008) (the “Plan”) is amended effective as of October 29, 2017, in
the following respects: 
 I. 
 Section III,
definition of “Good Reason” is amended to add the language “, provided this reason will not apply if you have explicitly waived this reason in writing” after the language “the material reduction of your job responsibilities
upon or after a Change in Control”. 
 II. 

Section IV is amended to replace the paragraph that starts “Your “base salary.”” with the following: 

Your “base salary.” Severance pay under this Plan is calculated using your base salary at the time your employment terminates. However, for
the 24 months following a Change in Control, your base salary is the higher of your base salary as in effect (i) at the time your employment terminates or (ii) as of the date of the Change in Control. Base salary excludes all bonuses
(such as signing bonuses and incentive bonuses), stock options, profit sharing, benefits, taxable fringes, expenses allowances or reimbursements, imputed income, or any other special compensation. 

III. 
 Section IV is further amended to add the
following paragraph to follow the amended “Your “base salary.” paragraph above: 
 Your “targeted annual bonus.” For
purposes of any severance pay under this Plan calculated based on your “targeted annual bonus,” your targeted annual bonus is the bonus applicable to you for the year in which your terminate. However, for the 24 months following a Change
in Control, your targeted annual bonus is the higher of your targeted bonus (expressed in dollars) in effect (i) at the time your employment terminates or (ii) as of the date of the Change in Control, based on your base salary in effect on
the date of the Change in Control. In all situations, targeted annual bonus will be calculated without regard to performance. 

 IV. 

Section IV, Reduction in Severance Benefits subsection is amended to add the following to the end of that subsection: 

Section 280G. These provisions apply only in the event that the Independent Accounting Firm (defined below) determines that
severance benefits under this Plan are subject to the limitations of Internal Revenue Code Section 280G, or any successor provision, and the regulations issued thereunder. 

In the event the Independent Accounting Firm determined that the Change in Control Benefits (defined below) payable to you would collectively constitute a
“parachute payment” as defined in Code Section 280G, and if the “net after-tax amount” of such parachute payment to you is less than what the net
after-tax amount to you would be if the Change in Control Benefits otherwise constituting the parachute payment were limited to the maximum “parachute value” of Change in Control Benefits that you
could receive without giving rise to any liability for any excise tax imposed by Internal Revenue Code Section 4999 (the “Excise Tax”), then the Change in Control Benefits otherwise constituting the parachute payment shall be
reduced so that the parachute value of all Change in Control Benefits, in the aggregate, will equal the maximum parachute value of all Change in Control Benefits that you can receive without any Change in Control Benefits being subject to the Excise
Tax. CEC shall achieve the necessary reduction in the Change in Control Benefits by reducing them in the following order: (A) a reduction as provided in any other agreement or plan; (B) reduction of cash payments payable under this Plan to
the extent either exempt from Code Section 409A or otherwise allowable under Code Section 409A; or (C) reduction of other payments and benefits to be provided to you to the extent allowable under Code Section 409A. CEC shall bear
all expenses with respect to the determinations by the Independent Accounting Firm retained under this subsection. Any good faith determinations of the Independent Accounting Firm made under this subsection shall be final, binding and conclusive
upon CEC and you. 
 A “net after-tax amount” shall be determined by taking into account all applicable
income, excise and employment taxes, whether imposed at the federal, state or local level, including the Excise Tax, and the “parachute value” of the Change in Control Benefits means the present value as of the date of the Change in
Control for purposes of Code Section 280G of the portion of such Change in Control Benefits that constitutes a parachute payment under Code Section 280G(b)(2). 

“Change in Control Benefits” shall mean any payment, benefit or transfer of property in the nature of compensation paid to you or for your benefit
under any arrangement which is considered contingent on a Change in Control for purposes of Code Section 280G, including, without limitation, any and all of CEC’s salary, incentive payments, restricted stock, stock option, equity-based
compensation or benefit plans, programs or other arrangements, and shall include benefits payable under this Plan. 

 “Independent Accounting Firm” shall mean the independent registered public accounting firm engaged
by CEC for general audit purposes as of the day prior to the effective date of the Change in Control; provided, however, if the independent registered public accounting firm so engaged by CEC is serving as accountant or auditor for the individual,
entity or group effecting the Change in Control, then CEC may appoint another nationally recognized independent registered public accounting firm to make the determinations required under this subsection. 

For clarity, CEC shall have no obligation to provide any “tax gross-up” payment related to the Excise Tax in
the event the Change in Control Benefits that would otherwise be characterized as a parachute payment are not reduced as set forth above and you are subject to the Excise Tax.

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00275-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00275-of-00352.parquet"}]]