Document:

Transition Agreement and Settlement Agreement and Release

 Exhibit 10.11 
 APPLE CONFIDENTIAL 
  

			
	To:	  	Tony Fadell
	From:	  	Dan Cooperman
	Date:	  	November 3, 2008
	Re:	  	Transition Agreement

 As we discussed, I want to confirm the terms of your transition from your current position at Apple to a new role.

 Apple has agreed to extend your employment through at least March 24, 2010 pursuant to the conditions of this Transition Agreement and attached
Settlement Agreement and Release (the “Term”). This will allow you to continue to receive a salary and benefits as well as to vest in certain Restricted Stock Units as described below. We have agreed that you will immediately resign from
your position as Senior Vice President, iPod, and as a member of the Apple Executive Team. In your new role as Special Advisor to Apple’s Chief Executive Officer, you shall provide such advice and other services concerning the business of Apple
as may be reasonably requested by the Chief Executive Officer from time to time on a part time, but not a full time basis. During the Term, you will not be employed by or perform consulting services for any other entity absent Apple’s prior
written consent. 
 Your new salary shall be $300,000 USD per year, subject to standard deductions and payable during Apple’s normal payroll cycle. You
shall continue to receive all other benefits of employment generally available to other members of the Company’s management, and shall be entitled to participate in Apple’s VP/Director Bonus Program. All salary, benefits and bonus
eligibility shall cease upon the termination of your employment with Apple. You will be entitled to the full FY’08 SVP Annual Bonus Program and all of your accrued vacation time to date shall be paid in full at your pre-transition salary. Any
subsequent vacation accrual shall be paid at your new salary. In the event that your wife is no longer employed at Apple, then you will not be subject to any blackout restrictions regarding your sale of Apple securities when and if such restrictions
lapse for her. 
 In consideration for Apple’s offer of continued employment, and upon the new grant of the RSUs set forth herein, you agree to cancel
all of your outstanding unvested restricted stock units (“RSUs”) (as reflected below). You will have no further rights with respect to any of the cancelled RSUs, but your stock options shall remain outstanding and the terms and conditions
of such options, including the vesting provisions, shall remain in full force and effect. The chart below lists your unvested RSUs that will be cancelled per your understanding and agreement: 
  

													
	 Grant Date
	  	Grant
Number	  	Equity
Type	  	Current Number
of Unvested
RSUs 1	  	 Cancellation
Date
	  	Cancelled
RSUs	  	New Number of
RSUs
	 8/30/2005
	  	128049	  	RSU	  	5,000	  	Effective Date	  	5,000	  	0
	 12/17/2007
	  	145216	  	RSU	  	50,000	  	Effective Date	  	50,000	  	0
	 2/2/2006
	  	130714	  	RSU	  	100,000	  	Effective Date	  	100,000	  	0

  

	 1
	 Unvested RSUs as of 9/30/08 

 Subject to the approval of and at a date to be determined by the Board of Directors, Apple will recommend that you be
granted an award of RSUs in the amount of 77,500 shares. The grant date and vesting commencement date will be determined by the Board, and shall be subject to the terms and conditions of Apple’s 2003 Employee Stock Plan. The RSUs subject to the
award will vest all at once on March 24, 2010, contingent upon your continued employment on that date, provided, however, that should Apple terminate your employment before March 24, 2010 without “Cause”, your RSUs will
accelerate and immediately vest and you shall be entitled to continuation of your salary payments (or pay in lieu at Apple’s discretion) and benefits or COBRA reimbursement through March 24, 2010 subject to your execution of a new release
commensurate with the terms of the attached release. 
 For purposes of this Agreement, “Cause” shall be defined as (i) an intentional
material act of fraud or dishonesty in connection with your duties, or in the course of your employment with the Company; (ii) the conviction of a felony or crime involving moral turpitude; (iii) Your breach of this Transition Agreement or
attached Settlement Agreement and Release; (iv) a willful act by you which constitutes gross misconduct and which is injurious to the Company; or (v) a willful breach of a material Apple policy or your Intellectual Property Agreement.
Prior to any termination for “Cause” Apple will provide you with written notice of the basis for a “Cause” termination. In addition, prior to any termination for “Cause” under (iii) above, Apple will provide you
with a ten (10) day opportunity to cure. No act or failure to act by you shall be considered “willful” unless committed without good faith and without a reasonable belief that the act or omission was in the Company’s best
interest. 
 You will have an opportunity to review in advance all press releases and SEC filings referencing your change in roles with Apple pursuant to the
Transition Agreement. Unless otherwise required by law, these announcements will not infer or suggest that you have been demoted and/or terminated. 
 In
order to receive the consideration outlined in this Transition Agreement, you will need to sign the attached Settlement Agreement and Release, and another similar agreement after your date of separation. The second agreement will release
claims for the period between the date you sign the first agreement and the end of your employment. If you fail to sign the attached release of claims within seven days, your employment at Apple will come to an immediate end. 
  

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 From today until your final date, I know that you will continue to adhere to Apple policies, and confidentiality
agreements (including your Intellectual Property Agreement). Your employment shall remain at-will which means that either you or Apple may terminate your employment with or without notice or cause at any time subject to your rights under this
Agreement. 
 Please be aware, the content of this memo and any related discussions or documents are confidential and are bound by the Intellectual Property
Agreement that you signed as a condition of your employment with Apple. You are free to discuss this with your spouse and or legal/financial advisor. 
  

	
	Sincerely,
	
	/s/    Dan Cooperman
	 Dan Cooperman
 Apple Inc.

  

 3 

 SETTLEMENT AGREEMENT AND RELEASE 
 This Settlement Agreement and General Release (Agreement) is made and entered into between Anthony Fadell (Employee) and Apple Inc. (Apple). 
 1. In exchange for the mutual promises set forth in this Agreement and in the Transition Agreement, Apple agrees as follows: 
 a. Apple will continue Employee’s employment pursuant to terms set forth in the Transition Agreement. (Attached hereto as Exhibit 1 is a true and
correct copy of the Transition Agreement which is hereby incorporated by reference.) 
 b. Effective as of the close of business on the date
indicated in the Transition Agreement, or earlier as provided therein, Employee shall be terminated from the employ of Apple. At such time, Employee shall receive all benefits due him pursuant to the Transition Agreement, and all other benefits and
sums otherwise due shall be computed in accordance with Apple’s standard procedures and applicable benefit or other plan documents. 
 2. In exchange for the consideration herein, Employee agrees to the following separate and independent covenants: 
 a. Transition
Agreement: Employee understands and agrees to the terms and conditions outlined in the attached Transition Agreement. 
 b.
Communications: Employee agrees for the length of his employment and for one (1) year thereafter that he will not make any public statement to the press or media regarding Apple or his employment at Apple without the prior written
approval of a Senior Officer of Apple. For avoidance of doubt, during the aforementioned period Employee shall not grant interviews, make public communications, take speaking opportunities, publish or provide any information or materials regarding
Apple, its products, employees or his experiences at Apple absent the prior written approval of a Senior Officer of Apple. Employee further agrees that he shall not disparage Apple and its officers, directors and employees in any way in response to
any inquiry from the press, public media or other third parties except as otherwise required by law. Apple’s current Chief Executive Officer, and current Executive Team shall, in return, not disparage Employee, except as otherwise required by
law. Other than as required by law, or as reasonably required to enforce its terms, Employee agrees not to disclose the terms or existence of this Agreement or the attached Transition Agreement to persons other than his spouse and his professional
advisers. 
  

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 c. Post Termination – Settlement Agreement & Release: Employee agrees that after his
termination from Apple, provided there has been no breach of this Agreement or the Transition Agreement by Apple, he will execute an agreement releasing all claims and potential claims that he may have that have arisen between the effective date of
this Agreement and his separation date in a form substantially similar to this Agreement. 
 d. No Solicitation of Apple Employees:
Employee agrees that for a period of one (1) year following his termination date, to not, either directly or indirectly, for himself or on behalf of others, solicit or recruit Apple employees or contractors to terminate their relationship with
Apple. 
 3. In exchange for the promises contained in this Agreement and the Transition Agreement above Employee, on behalf of
Employee’s heirs, estate, executors, administrators, successors and assigns does fully and completely release, discharge and agree to hold harmless Apple, its past, present and future successors, officers, directors, attorneys, agents,
employees, shareholders, assigns, subsidiaries and affiliates from all charges, actions, claims, judgments, obligations, liabilities, costs, expenses, damages (including but not limited to general, special, punitive, liquidated and compensatory
damages) or causes of action of every kind, nature and character, known or unknown, in law or equity, fixed or contingent, which Employee may now have, or ever had arising from or in any way connected with Employee’s relationship or termination
of employment with Apple. This release includes, but is not limited to: 
 a. Any charges or claims relating to, arising out of, or connected
with Employee’s employment with Apple, whether or not based upon any alleged violations of public policy; compliance (or lack thereof) with any internal Apple policy, procedure, practice or guideline; or any oral, written, express, and/or
implied employment contract or agreement, or the breach of any term thereof, including but not limited to, any implied covenant of good faith and fair dealing; or any federal, state, county or municipal statute, law, regulation, order or ordinance
whether or not relating to labor or employment; or any other charges or claims relating to the law of contract or tort; 
 b. any charges or
claims relating to employment discrimination on account of race, sex, national origin, creed, religion, disability, or other basis, including harassment, whether or not arising under the federal Civil Rights Acts (Title VII), 42 U.S.C.
Section 1981, the Rehabilitation Act of 1973, the Americans With Disabilities Act, any amendments to the foregoing laws, or any other federal, state, county, municipal or other law, statute, regulation or order relating to employment
discrimination; and any claims relating to employment discrimination on account of age, whether or not arising under the Age Discrimination in Employment Act (ADEA) or any state law, statute or regulation relating to age discrimination. 

 

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 c. any charges or claims arising under the Employee Retirement and Income Security Act, and any other
laws and regulations relating to employment, and any and all claims for attorney’s fees and costs; 
 d. any charges or claims relating
to pay or leave of absence arising under the Fair Labor Standards Act, the Family & Medical Leave Act, and any similar state laws or regulations; 
 e. any charges or claims for reemployment, salary, wages, bonuses, vacation pay, stock options, acquired rights, appreciation from stock options, stock appreciation rights, any other form of equity or equity rights,
benefits or other compensation of any kind; and 
 f. any charges or claims relating to, arising out of, or connected with any other matter or
event occurring prior to the execution of the Agreement whether or not brought before any judicial, administrative, or other tribunal. 
 Employee represents and warrants that Employee has not assigned any such charge or claim or authorized any other person or entity to assert such charge or claim on Employee’s behalf. Further, Employee agrees that under this Agreement,
Employee waives any claim for damages incurred at any time in the future because of alleged continuing effects of past wrongful conduct involving any such claims and any right to sue for injunctive relief against Apple. 
 In entering into this Agreement, Employee has intended that this Agreement be a full and final settlement of all matters, whether or not presently
disputed, that could have arisen between the parties. Employee understands and expressly agrees that by this Agreement he expressly waives all claims of every nature and kind whatsoever, known or unknown, suspected or unsuspected, past or present
and all rights under Section 1542 of the California Civil Code and/or any similar statute or law of any other jurisdiction. Such section reads as follows: 
 Section 1542. “A general release does not extend to claims which the creditor does not know or suspect to exist in his favor at the time of executing the release, if known by him must have materially
affected his settlement with the debtor.” 
 It is expressly agreed that the charges and claims released pursuant to this
Agreement include all charges and claims against individual employees of Apple, whether or not such employees were acting within the course and scope of their employment. 
 Notwithstanding the above, nothing in this Settlement Agreement shall release or in any manner impair any rights Employee may have under California Labor Code Section 2802 or any other right to indemnification
under applicable law, policy, agreement, applicable Apple by-laws, certificate of incorporation, or directors and officers liability insurance. Further the release contained herein shall not extend to any obligations incurred under this Agreement or
the Transition Agreement, as well as any claims that cannot be released as a matter of law. 
  

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 4. Non-Waiver; Complete Agreement; Governing Law. No provisions of this Agreement may be modified,
waived or discharged except in writing signed by both Employee and a Senior Officer of Apple. No waiver by either party at any time of any breach by the other party of, or compliance with, any condition or provision of this Agreement shall be deemed
a waiver of similar or dissimilar provisions or conditions at the same or at any prior to subsequent time. This Agreement and the attached Transition Agreement is the complete agreement of the parties as to the subject matter hereof. No agreements
or representations, oral or otherwise, express or implied, with respect to the subject matter hereof have been made by either party which are not set forth expressly in this Agreement or the Transition Agreement, and Employee and Apple represent and
acknowledge that they have not relied upon any agreements or representations not set forth in either document, and that any prior agreements or representations relating to the subject matter of this Agreement are hereby superseded. Notwithstanding
the above, this Agreement is not intended to modify, supersede, or otherwise extinguish the provisions of Employee’s Intellectual Property Agreement. To the extent any provisions of the Intellectual Property Agreement have continuing force and
effect after the termination of Employee’s employment with Apple, this Agreement does not alter or affect those provisions in any way. This Agreement shall be governed by and construed in accordance with the laws of the State of California,
other than its conflict of law provisions. 
 5. Severability. The invalidity or unenforceability of any provisions of this Agreement
shall not affect the validity or enforceability of any other provision of this Agreement, which shall remain in full force and effect. 
 6.
Release of Claims. Employee understands that Employee has seven (7) days from the date Employee receives this Agreement to consider and sign this Agreement, but that Employee may waive this period of time. 
 7. Counterparts. This Agreement may be executed in one or more counterparts, each of which shall be deemed to be an original but all of which
together shall constitute one and the same instrument. 
 8. Attorneys’ Fees. In the event of the bringing of any action,
proceeding, arbitration or suit by a party hereto against another party hereunder by reason of any breach of any of the covenants, agreements, or provisions arising out of this Agreement, the prevailing party shall be entitled to recover all costs
and expenses of that action or suit, or at trial, arbitration or on appeal, and in collection of judgment, including reasonable attorneys’ fees, accounting, and other professional fees resulting therefrom. 
  

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 IN WITNESS WHEREOF, the Employee and Apple have executed this Agreement, effective as of the date first
above written. 
  

									
		 		 	Apple
				
	Date: November 3, 2008	 		 	By: 	 	/s/    Dan Cooperman
		 		 		 		 	Dan Cooperman, Apple Inc.

 By signing this Agreement, I acknowledge that I have had the opportunity to review this Agreement carefully with
an attorney of my choice; that I have carefully read this Agreement, and that I fully I understand the terms of this Agreement and attached Transition Agreement along with their final and binding effect; and that I knowingly and voluntarily agree to
them. 
  

									
	Date: November 3, 2008	 		 	By: 	 	/s/    Anthony M. Fadell
		 		 		 		 	Anthony M. Fadell

  

 8Employment Agreement

 Exhibit 10.1 
 EMPLOYMENT AGREEMENT 
 This Employment Agreement
(“Agreement”) is entered into January 20, 2009, by and between Capella Education Company, a Minnesota corporation (the “Company”), and J. Kevin Gilligan (“Executive”). 
 BACKGROUND 
 A.
Executive desires to be employed by the Company, and the Company wishes to hire Executive upon the terms and conditions set forth in this Agreement. 
 B. During employment with the Company Executive will have access to confidential, proprietary and trade secret information of the Company. It is desirable and in the best interests of the Company and its shareholders
to protect confidential, proprietary and trade secret information of the Company, to prevent unfair competition by former executives of the Company following separation of their employment with the Company and to secure cooperation from former
executives with respect to matters related to their employment with the Company. 
 C. Executive understands that Executive’s employment
and receipt of the compensation and benefits provided for in this Agreement depends on, among other things, Executive’s willingness to agree to and abide by the non-disclosure, non-competition, non-solicitation, assignment of inventions and
other covenants contained in Exhibit A attached to this Agreement (the “Confidentiality Agreement”). Executive and the Company acknowledge that Executive was provided a copy of this Agreement and Exhibit A before Executive accepted
employment with the Company. 
 D. The parties acknowledge that nothing in this Agreement limits either party’s right to terminate
Executive’s employment at any time and for any reason. 
 In consideration of Executive’s employment with the Company, the
compensation and benefits payable in connection with such employment, and the foregoing premises and other good and valuable consideration provided for in this Agreement, the receipt and adequacy of which are hereby acknowledged, Executive and the
Company agree as follows: 
 AGREEMENT 
 1. EMPLOYMENT. Commencing no later than March 5, 2009, or such other date mutually agreed upon by the parties (the “Effective Date”), the Company will employ
Executive, and Executive will accept such employment and perform services for the Company, under the terms and conditions set forth in this Agreement. Executive’s employment under the terms and conditions set forth in this Agreement will
continue until terminated in accordance with Section 5 below. In addition, as of the Effective Date, Executive shall be appointed to the Board and, in connection with the Company’s 2009 annual meeting of shareholders, Executive shall be
included in the slate of directors recommended by the Board. 
  

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 2. EMPLOYMENT AS CHIEF EXECUTIVE
OFFICER. While Executive is employed by the Company during the Term, Executive shall serve as the Company’s Chief Executive Officer. Executive shall report to the Board and shall perform such duties and
responsibilities as the Board may assign to Executive from time to time consistent with such position. 
 3. PERFORMANCE
OF DUTIES AND RESPONSIBILITIES. Executive shall serve the Company faithfully and to the best of Executive’s ability, devoting Executive’s full working time,
attention, and efforts to the business of the Company. Executive shall follow and comply with applicable policies and procedures adopted by the Board or the Company from time to time, including without limitation policies relating to business
ethics, conflict of interest, non-discrimination and non-harassment, confidentiality and protection of trade secrets, and insider trading. Executive shall not engage in any other employment or other material business activity, except as approved in
writing by the Board. It will not be a violation of this Agreement for Executive to (i) serve on civic or charitable boards or committees or (ii) manage personal investments, so long as such activities do not materially interfere with the
performance of Executive’s responsibilities to the Company. Executive hereby represents and confirms that Executive is under no contractual or legal commitments that would prevent Executive from fulfilling the duties and responsibilities as set
forth in or contemplated by this Agreement. 
 4. COMPENSATION. While Executive is employed by the
Company during the Term, Executive will be provided with the following compensation and benefits: 
 (a) Annual Base Salary. The
Company will pay to Executive for services provided hereunder an Annual Base Salary at a rate determined from time to time by the Board, which Annual Base Salary will be paid in accordance with the Company’s normal payroll policies and
procedures. Upon commencement of Executive’s employment hereunder, Executive’s Annual Base Salary will be $575,000.00. The Board (or authorized committee of the Board) will review Executive’s performance and compensation on an annual
basis and determine any adjustments to Executive’s Annual Base Salary in its sole discretion. 
 (b) Incentive Compensation. Executive will be eligible to participate in the Company’s Annual Incentive Plan as approved by the Board, in accordance with the terms and conditions of such plan as may be in
effect from time to time. For the Company’s fiscal year 2009, Executive’s target incentive award under the Company’s Annual Incentive Plan will be 100% of Executive’s Annual Base Salary, with a minimum award of 0% and a maximum
award of 200% of Annual Base Salary. Any Annual Incentive Plan award earned by Executive for a fiscal year shall be paid at the same time the Company pays incentive awards for other executive officers, but in no event no later than 2 1/2 months after the end of the fiscal year. 
 (c) Employee Benefits. Executive will be entitled to participate in all employee benefit plans and programs generally available to executive employees of the Company, such as medical, dental, retirement and
vacation time, to the extent that Executive meets the eligibility requirements for each individual plan or program. Executive’s participation in any plan or program will be subject to the provisions, rules, and regulations of, or applicable to,
the plan or program. The Company provides no assurance as to the adoption or continuation of any particular employee benefit plan or program. 
  

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 (d) Expenses. The Company will reimburse Executive for all reasonable and necessary out-of-pocket
business, travel, and entertainment expenses incurred by Executive in the performance of duties and responsibilities to the Company during the Term. Such reimbursement shall be subject to the Company’s normal policies and procedures for expense
verification, documentation, and reimbursement. 
 (e) Equity. From time to time the Board in its sole discretion may grant to
Executive stock options, restricted stock or other equity-based awards, on such terms and conditions as the Board may provide, subject to applicable plans and agreements to be entered into relating to such equity-based awards. Provided
Executive remains actively employed by the Company as of the date the Company awards equity compensation to other executive officers for fiscal year 2009, and subject to the terms and conditions of the Equity Inventive Plan and standard equity award
agreement(s) to be entered into by and between the Company and Executive, the Company will grant Executive equity-based awards in the form of stock options, restricted stock or a combination thereof with an aggregate value of at least $1,000,000.00
(the “2009 Equity Grant”). The exercise price of any stock options and the value of any restricted stock granted in connection with the 2009 Equity Grant shall be the Fair Market Value (as defined in the Equity Incentive Plan) of the
Company’s common stock as of the date of grant. The value of any stock option in connection with the 2009 Equity Grant will be based on the Black-Scholes value calculation method. 
 (f) Initial Equity. The Company shall grant to Executive 6,000 shares of restricted stock, subject to a two-year ratable vesting period and the
terms and conditions of the Equity Incentive Plan and standard equity award agreement(s) to be entered into by and between the Company and Executive. If Executive commences employment on or before February 24, 2009, then the grant date for such
6,000 shares of restricted stock will be February 24, 2009; if Executive commences employment between February 25, 2009 and March 5, 2009, then the grant date will be date on which Executive commences employment. 
 5. TERMINATION OF EMPLOYMENT. Executive’s employment hereunder is at will. The
Company may terminate Executive’s employment with or without cause at any time, and Executive may resign at any time, with or without advance notice, subject to the rights and obligations of the parties under this Agreement. Executive’s
employment with the Company under this Agreement will terminate upon: 
 (a) The Company providing written notice to Executive of the
termination of his employment, effective as of the date stated in such notice; 
 (b) The Company’s receipt of Executive’s written
resignation from the Company, effective as of the date indicated in such resignation or at such earlier date as the Board in its sole discretion shall determine; or 
 (c) Executive’s death or Disability. 
  

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 6. SEVERANCE BENEFITS UNDER THE
SENIOR EXECUTIVE SEVERANCE PLAN. During Executive’s employment hereunder, Executive shall participate in and be eligible for severance pay and benefits on the
conditions and to the extent provided under the Company’s Senior Executive Severance Plan, subject to the following modifications. Notwithstanding the terms of the Senior Executive Severance Plan, Executive shall become a participant in the
Senior Executive Severance Plan on the Effective Date. Further, if Executive is otherwise eligible for and has met all terms and conditions for receipt of benefits under the Senior Executive Severance Plan, the severance payable to Executive under
the Senior Executive Severance Plan upon involuntary termination of Executive’s employment without Cause, as defined in the Senior Executive Severance Plan, shall be not less than an amount equal to three times Executive’s Annual Base
Salary in effect immediately prior to the date of termination of Executive’s employment. The timing and form of any benefits payable to Executive upon termination of employment shall be in accordance with the terms and conditions set forth in
the Senior Executive Severance Plan, except that payments will be made over a 24-month period. In addition, if the cash severance benefits payable to Executive in the first six months following a qualifying severance event is limited under the terms
of the Senior Executive Severance Plan, any amounts that could not be paid in the first six months under the terms of the Senior Executive Severance Plan will be paid to Executive in a lump sum (without interest) in the seventh month following the
qualifying severance event. 
 7. OTHER TERMINATION. If Executive’s termination of
employment occurs for any reason for which Executive is not eligible for severance benefits under the terms and conditions of the Senior Executive Severance Plan (for example upon termination for cause or in the case of Executive’s death or
Disability), then the Company will pay to Executive, or Executive’s beneficiary or Executive’s estate, as the case may be, only such compensation that has been earned but not paid to Executive as of the date of termination, payable
pursuant to the Company’s normal payroll practices and procedures, and Executive shall not be entitled to any additional compensation or benefits provided under this Agreement. 
 8. VENTURES. If, during Executive’s employment with the Company, Executive participates in the planning or
implementing of any project, program, or venture involving the Company, all rights in such project, program, or venture belong to the Company. Except as approved in writing by the Board, Executive will not be entitled to any interest in any such
project, program, or venture or to any commission, finder’s fee, or other compensation in connection therewith. Executive will have no interest, direct or indirect, in any customer or supplier that conducts business with the Company.

 9. CONFIDENTIALITY AND RESTRICTIVE COVENANTS. At the
same time as Executive signs this Agreement, Executive will sign the Confidentiality Agreement, in consideration of Executive’s employment hereunder and the payments and benefits provided to Executive pursuant to this Agreement and other good
and valuable consideration. 
 10. OTHER POST-TERMINATION
OBLIGATIONS. 
 (a) Immediately upon termination of Executive’s employment with the Company for any
reason, Executive will resign all positions then held as a director or officer of the Company and of any subsidiary, parent or affiliated entity of the Company. 
  

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 (b) Upon termination of Executive’s employment with the Company for any reason, Executive shall
promptly deliver to the Company any and all Company records and any and all Company property in Executive’s possession or under Executive’s control, including without limitation manuals, books, blank forms, documents, letters, memoranda,
notes, notebooks, reports, printouts, computer disks, flash drives or other digital storage media, source codes, data, tables or calculations and all copies thereof, documents that in whole or in part contain any trade secrets or confidential,
proprietary or other secret information of the Company and all copies thereof, and keys, access cards, access codes, passwords, credit cards, personal computers, handheld personal computers or other digital devices, cell phones and other electronic
equipment belonging to the Company. 
 (c) Following termination of Executive’s employment with the Company for any reason, Executive
will, upon reasonable request of the Company or its designee, cooperate with the Company in connection with the transition of Executive’s duties and responsibilities for the Company; consult with the Company regarding business matters that
Executive was directly and substantially involved with while employed by the Company; and be reasonably available, with or without subpoena, to be interviewed, review documents or things, give depositions, testify, or engage in other reasonable
activities in connection with any litigation or investigation, with respect to matters that Executive then has or may have knowledge of by virtue of Executive’s employment by or service to the Company or any related entity. 
 (d) Executive will not malign, defame or disparage the reputation, character, image, products or services of the Company, or the reputation or character
of the Company’s directors, officers, employees or agents, provided that nothing in this Section 10(d) shall be construed to limit or restrict Executive from taking any action that Executive in good faith reasonably believes is necessary
to fulfill Executive’s fiduciary obligations to the Company, or from providing truthful information in connection with any legal proceeding, government investigation or other legal matter. 
 11. DEFINITIONS. The capitalized terms used in this Agreement have the following meanings: 
 (a) “Annual Base Salary” means Executive’s annualized base salary as established and adjusted in accordance with this Agreement from time
to time. 
 (b) “Board” means the Board of Directors of the Company, including any authorized committee of the Board. 

(c) “Code” means the Internal Revenue Code of 1986, as amended. Any reference to a specific provision of the Code will include a reference
to such provision as it may be amended from time to time and to any successor provision. 
 (d) “Company” means the Company as
defined in the first sentence of this Agreement and any successor to its business and/or assets which assumes or agrees to perform this Agreement by operation of law, assignment or otherwise. 
  

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 (e) “Disability” has the meaning set forth in any policy of long term disability insurance
maintained by the Company for the benefit of Executive, as determined by the insurer of such plan, or, if no such policy is maintained, “Disability” means the inability of Executive to perform on a full-time basis the duties and
responsibilities of Executive’s employment with the Company by reason of Executive’s illness or other physical or mental impairment or condition, if such inability continues for an uninterrupted period of one hundred twenty (120) days
or more during any one hundred eight (180) day period. A period of inability is “uninterrupted” unless and until Executive returns to full time work for a continuous period of at least thirty (30) days. 
 (f) “Equity Incentive Plan” means the Company’s 2005 Stock Incentive Plan (As Originally Effective May 5, 2005, and as Amended
August 2, 2006 and December 14, 2006), as may be amended and in effect from time to time, or any similar successor plan to the Equity Incentive Plan. 
 (g) “Senior Executive Severance Plan” means the Company’s Senior Executive Severance Plan (As Originally Effective September 11, 2006, and as Amended December 13, 2007 and August 14,
2008), as may be amended and in effect from time to time, or any similar successor plan to the Senior Executive Severance Plan. 
 12.
MISCELLANEOUS. 
 (a) Successors. This Agreement shall not be assignable, in whole or in part, by
either party without the written consent of the other party, except that the Company may, without the consent of Executive, assign or delegate all or any portion of its rights and obligations under this Agreement to any corporation or other business
entity (i) with which the Company may merge or consolidate, (ii) to which the Company may sell or transfer all or substantially all of its assets or capital stock, or (iii) that is or becomes an affiliate under common control with the
Company. Any such current or future successor to which any right or obligation has been assigned or delegated shall be deemed to be the “Company” for purposes of such rights or obligations of this Agreement. 
 (b) Tax Withholding. The Company may withhold from any amounts payable under this Agreement such federal, state and local income and employment
taxes as the Company shall determine are required or authorized to be withheld pursuant to any applicable law or regulation. Executive will be solely responsible for the payment of all taxes due and owing with respect to wages, benefits, and other
compensation provided to him hereunder. 
 (c) Section 409A. This Agreement is intended to satisfy, or be exempt from, the
requirements of sections 409A(a)(2), (3) and (4) of the Code, including current and future guidance and regulations interpreting such provisions, and should be interpreted accordingly. 
 (d) Governing Law. All matters relating to the interpretation, construction, application, validity, and enforcement of this Agreement will be
governed by the laws of the State of Minnesota without giving effect to any choice or conflict of law provision or rule, whether of the State of Minnesota or any other jurisdiction, that would cause the application of laws of any jurisdiction other
than the State of Minnesota. 
  

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 (e) Dispute Resolution; Jurisdiction and Venue. In the event of any dispute arising out of or
relating to this Agreement, Executive’s employment with the Company or the termination of such employment (except for any dispute arising under the Confidentiality Agreement or the Senior Executive Severance Plan, which shall in each case be
governed by their respective terms) (a “Dispute”), the parties shall first endeavor to resolve any Dispute by informal discussion and negotiation. If such informal discussion and negotiation fails to resolve the Dispute within forty-five
(45) days after written notice of such Dispute is first given by one party to the other, then either party may proceed to bring a claim in court with respect to such Dispute as provided herein. Executive and the Company consent to jurisdiction
of the courts of the State of Minnesota and/or the United States District Court, District of Minnesota, for the purpose of resolving all issues of law, equity, or fact arising out of or in connection with this Agreement. Any action involving claims
of a breach of this Agreement must be brought exclusively in such courts. Each party consents to personal jurisdiction over such party in the state and/or federal courts of Minnesota and hereby waives any defense of lack of personal jurisdiction and
inconvenient forum. Venue, for the purpose of any suit brought in Minnesota state court, will be in Hennepin County, State of Minnesota. 
 (f) Waiver of Jury Trial. To the maximum extent permitted by law, Executive and the Company waive any and all rights to a jury trial with respect to any dispute arising out of or relating to this Agreement. 
 (g) Notice. Notices and all other communications provided for in the Agreement shall be in writing and shall be deemed to have been duly given
when personally delivered, sent by reliable overnight courier or mailed by United States registered mail (or its equivalent for overseas delivery), return receipt requested, postage prepaid, and addressed as follows: 
 If to the Company: 
 Capella Education
Company 
 Attn: General Counsel 
 225 South Sixth Street, 9th Floor 
 Minneapolis, MN 55402; 
 If to Executive, to Executive’s most recent address on file with the Company; 
 or to such other address as either party may have furnished to the other in writing in accordance herewith, except that notices of change of address shall be effective only upon receipt. 
 (h) Modifications; Waiver. No provision of this Agreement may be modified, waived or discharged unless such waiver, modification or discharge is
agreed to in writing signed by Executive and the Company. No waiver by either party hereto at any time of any breach by the other party of, or compliance with, any condition or provision of this Agreement to be performed by such other party shall be
deemed a waiver of similar or dissimilar provisions or conditions at the same or at any prior or subsequent time. 
  

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 (i) Entire Agreement. This Agreement and the Confidentiality Agreement constitute the entire
understandings and agreements between the Company and Executive with regard to the subject matter hereof, including payments and benefits upon a termination of Executive’s employment or other separation from service with the Company. This
Agreement supersedes and renders null and void all prior agreements, offer letters, plans, programs or other undertakings between the parties with regard to the subject matter hereof (other than those specifically referenced herein), whether written
or oral. 
 IN WITNESS WHEREOF, the parties have executed this Agreement as of the date first written above. 
  

			
	CAPELLA EDUCATION COMPANY
		
	By:	 	 /s/ Stephen G. Shank

		 	Stephen G. Shank, Chairman
	
	 /s/ J. Kevin Gilligan

	J. Kevin Gilligan

  

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