Document:

Exhibit 10.1

Exhibit 10.1

SECOND AMENDMENT TO EMPLOYMENT AGREEMENT

(Non CEO)

This Second Amendment to Employment Agreement is executed as of March 6, 2011, by and between
TomoTherapy Incorporated, a Wisconsin corporation (the “Company”), and Brenda S. Furlow, an
individual (“Employee”), and amends that certain Employment Agreement between the Employee
and Company entered into effective November 5, 2008, which was amended by the First Amendment
effective July 1, 2009 (the “Agreement”).

RECITALS

The Company wishes to revise the provision of the Agreement limiting benefits payable in
connection with a change in control, and the Employee agrees to such revised provision as set forth
herein.

NOW, THEREFORE, in consideration of the premises and the mutual agreements and covenants
contained herein, and for other good and valuable consideration, the receipt and sufficiency of
which is hereby acknowledged by the Company and Employee,

IT IS HEREBY AGREED AS FOLLOWS:

1. Section 3.2(d) of the Agreement is amended to delete the words “, subject to Section
3.2(g)” as they appear therein.

2. Section 3.2(g) of the Agreement is deleted in its entirety and replaced by the
following:

(g) Certain Additional Payments by the Company. (i) Anything in this
Agreement to the contrary notwithstanding, in the event it shall be determined that any
payment, distribution or benefit by the Company or its affiliated companies to or for the
benefit of Employee (whether paid or payable or distributed or distributable pursuant to the
terms of this Agreement or otherwise, but determined without regard to any additional
payments required under this Section 3.2(g)) (a “Payment”) would be subject to the excise
tax imposed by Section 4999 of the Code, or any interest or penalties are incurred by
Employee with respect to such excise tax (such excise tax, together with any such interest
and penalties, are hereinafter collectively referred to as the “Excise Tax”), then Employee
shall be entitled to receive an additional payment (a “Gross-Up Payment”) in an amount such
that after payment by Employee of all taxes (including any interest or penalties imposed
with respect to such taxes), including, without limitation, any income taxes (and any
interest and penalties imposed with respect thereto) and Excise Tax imposed upon the
Gross-Up Payment, Employee retains an amount of the Gross-Up Payment equal to the Excise Tax
imposed upon the Payments.

 

 

 

(ii) Subject to the provisions of Section 3.2(g)(iii), all determinations
required to be made under this Section 3.2(g), including whether and when a
Gross-Up Payment is required and the amount of such Gross-Up Payment and the
assumptions to be utilized in arriving at such determination, shall be made by the
Company’s public accounting firm (the “Accounting Firm”) which shall provide
detailed supporting calculations both to the Company and Employee within 15 business
days of the receipt of notice from Employee that there has been a Payment, or such
earlier time as is requested by the Company. In the event that the Accounting Firm
is serving as accountant or auditor for the individual, entity or group effecting
the Change of Control, Employee shall appoint another nationally recognized public
accounting firm to make the determinations required hereunder (which accounting firm
shall then be referred to as the Accounting Firm hereunder). All fees and expenses
of the Accounting Firm shall be borne solely by the Company. Any Gross-Up Payment,
as determined pursuant to this Section 3.2(g), shall be paid by the Company to
Employee within five days of the receipt of the Accounting Firm’s determination, but
in no event later than the last day of the calendar year following the calendar year
in which the related tax is remitted to the Internal Revenue Service. If the
Accounting Firm determines that no Excise Tax is payable by Employee, it shall
furnish Employee with a written opinion that failure to report the Excise Tax on
Employee’s applicable federal income tax return would not result in the imposition
of a negligence or similar penalty. Any determination by the Accounting Firm shall
be binding upon the Company and Employee. As a result of the uncertainty in the
application of Section 4999 of the Code at the time of the initial determination by
the Accounting Firm hereunder, it is possible that Gross-Up Payments which will not
have been made by the Company should have been made (“Underpayment”), consistent
with the calculations required to be made hereunder. In the event that the Company
exhausts its remedies pursuant to Section 3.2(g)(iii) and Employee thereafter is
required to make a payment of any Excise Tax, the Accounting Firm shall determine
the amount of the Underpayment that has occurred and any such Underpayment shall be
promptly paid by the Company to or for the benefit of Employee.

(iii) Employee shall notify the Company in writing of any claim by the Internal
Revenue Service that, if successful, would require the payment by the Company of the
Gross-Up Payment. Such notification shall be given as soon as practicable but no
later than 10 business days after Employee is informed in writing of such claim and
shall apprise the Company of the nature of such claim and the date on which such
claim is requested to be paid. Employee shall not pay such claim prior to the
expiration of the 30-day period following the date on which Employee gives such
notice to the Company (or such shorter period ending on the date that any payment of
taxes with respect to such claim is due). If the Company notifies Employee in
writing prior to the expiration of such period that it desires to contest such
claim, Employee shall:

(A) give the Company any information reasonably requested by the
Company relating to such claim,

 

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(B) take such action in connection with contesting such claim as the
Company shall reasonably request in writing from time to time, including,
without limitation, accepting legal representation with respect to such
claim by an attorney reasonably selected by the Company,

(C) cooperate with the Company in good faith in order effectively to
contest such claim, and

(D) permit the Company to participate in any proceedings relating to
such claim;

provided, however, that the Company shall bear and pay directly all
costs and expenses (including additional interest and penalties) incurred in
connection with such contest and shall indemnify and hold Employee harmless, on an
after-tax basis, for any Excise Tax or income tax (including interest and penalties
with respect thereto) imposed as a result of such representation and payment of
costs and expenses. Without limitation on the foregoing provisions of this Section
3.2(g)(iii), the Company shall control all proceedings taken in connection with such
contest and, at its sole option, may pursue or forgo any and all administrative
appeals, proceedings, hearings and conferences with the taxing authority in respect
of such claim and may, at its sole option, either direct Employee to pay the tax
claimed and sue for a refund or contest the claim in any permissible manner, and
Employee agrees to prosecute such contest to a determination before any
administrative tribunal, in a court of initial jurisdiction and in one or more
appellate courts, as the Company shall determine; provided further,
that if the Company directs Employee to pay such claim and sue for a refund, the
Company shall advance the amount of such payment to Employee on an interest-free
basis and shall indemnify and hold Employee harmless, on an after-tax basis, from
any Excise Tax or income tax (including interest or penalties with respect thereto)
imposed with respect to such advance or with respect to any imputed income with
respect to such advance; and provided further, that any extension of
the statute of limitations relating to payment of taxes for the taxable year of
Employee with respect to which such contested amount is claimed to be due is limited
solely to such contested amount. Furthermore, the Company’s control of the contest
shall be limited to issues with respect to which a Gross-Up Payment would be payable
hereunder and Employee shall be entitled to settle or contest, as the case may be,
any other issue raised by the Internal Revenue Service or any other taxing
authority.

 

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(iv) If, after the receipt by Employee of an amount advanced by the Company
pursuant to Section 3.2(g), Employee becomes entitled to receive, and receives, any
refund with respect to such claim, Employee shall (subject to the Company’s
complying with the requirements of Section 3.2(g)(iii)) promptly pay to the Company
the amount of such refund (together with any interest paid or credited thereon after
taxes applicable thereto). If, after the receipt by Employee of an amount advanced
by the Company pursuant to Section 3.2(g)(iii), a determination is made that
Employee shall not be entitled to any refund with
respect to such claim and the Company does not notify Employee in writing of
its intent to contest such denial of refund prior to the expiration of 30 days after
such determination, then such advance shall be forgiven and shall not be required to
be repaid and the amount of such advance shall offset, to the extent thereof, the
amount of Gross-Up Payment required to be paid.

3. All other provisions of the Agreement are not altered by this Second Amendment and remain
in full force and effect.

IN WITNESS WHEREOF, the parties have executed this Amendment as of the day and year written
above.

	 	 	 	 	 	 	 	 	 
	EMPLOYEE:	 	 	 	COMPANY:	 	 
	 
	 	 	 	 	 	 	 	 
	Brenda S. Furlow	 	 	 	TomoTherapy Incorporated	 	 
	 
	 	 	 	 	 	 	 	 
	/s/ Brenda S. Furlow

	 	 	 	By:	 	/s/ Frederick A. Robertson	 	 
	 

	 	 
	 	 	 	Name: Frederick A. Robertson, M.D.
Title:   Chief Executive Officer

	 	 

 

4exv10w1

Exhibit 10.1

2011

SERVICE AGREEMENT

between

EDUCATIONCITY LIMITED

- and -

RICHARD WHALLEY

Weil, Gotshal & Manges

One South Place London EC2M 2WG

Tel: +44 (0) 20 7903 1000 Fax: +44 (0) 20 7903 0990

www.weil.com

 

THIS AGREEMENT is made on June 9, 2010 between the following parties

	(1)	 	EDUCATIONCITY LIMITED, a company incorporated in England and Wales (registered
number 03343749) whose registered office is at 8 Saddlers Court, Barleythorpe, Oakham, Rutland
LE15 7GH (the “Company”); and
	 
	(2)	 	RICHARD WHALLEY of Rose Cottage 4 Teigh Road Market of
Overton, Rutland LE15 7PW  (the “Executive”).

IT IS AGREED as follows:

	1	 	DEFINITIONS
	 
	1.1	 	Definitions

	 	 	In this Agreement the following words and expressions shall have the following meanings:

	 	 	 

	“Act”

	 	means the Employment Rights Act 1996;
	 
	 	 
	“Board”

	 	means the board of directors of Archipelago
Learning, Inc. from time to time;
	 
	 	 
	“CEO”

	 	means the Chief Executive Officer of
Archipelago Learning, Inc. from time to time;
	 
	 	 
	“Confidential Information”

	 	means all information that relates to the
business, technology, manner of operation,
suppliers, panelists, customers, finances,
employees, plans, proposals or practices of
the Company, any Group Company or of any
third parties doing business with the Company
or any Group Company, and includes, without
limitation, the identities of and other
information regarding the Company or any
Group Company’s suppliers, panelists,
customers and prospects, supplier lists,
panelist list employee information, business
plans and proposals, software programs,
marketing plans and proposals, technical
plans and proposals, research and
development, budgets and projections,
nonpublic financial information, and all
other information the Company or any Group
Company designates as “confidential” or
intends to keep as confidential or
proprietary;
	 
	 	 
	“Deductions”

	 	means any amount owed in respect of income
tax and employees National Insurance
Contributions arising in respect of any
salary or other entitlements which the
Company shall deduct in order to account to
H.M. Revenue and Customs (“HMRC”) for such
amounts;
	 
	 	 
	“Effective Date”

	 	means 1 March 2011;

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	“Good Reason”

	 	means the occurrence of any of the following
events without the Executive’s express
written consent: (i) any breach by the
Company of any material provision of this
Agreement or any other written agreement with
the Executive, (ii) a reduction in the
Executive’s base salary, or (iii) a material
reduction or diminution of the Executive’s
duties, responsibilities or authorities,
which are caused by an act of the Company
(which shall not include the appointment of
any individual pursuant to clause 3.3. or
clause 12.3). The Company shall have 30 days
after receipt of notice from the Executive
setting forth the specific conduct that
constitutes Good Reason, to cure such conduct
that would result in Good Reason. The
Executive may not resign his employment for
Good Reason unless the Executive has provided
the Company with at least 30 days’ prior
written notice of the Executive’s intent to
resign for Good Reason (which notice must be
provided within 60 days following (x) the
occurrence of the event(s) purported to
constitute Good Reason, or (y) if the
Executive did not know of the occurrence of
any of such events, the date on which the
Executive had actual knowledge of the
occurrence of any of such events) and has set
forth in reasonable detail the specific
conduct that constitutes Good Reason and the
specific provisions of this Agreement on
which the Executive relies.
	 
	 	 
	“Group Company”

	 	means any company which from time to time is:

	 	(a)	 	a Subsidiary of the Company;
	 
	 	(b)	 	a Holding Company of the Company;
	 
	 	(c)	 	a Subsidiary of any such Holding Company;
or
	 
	 	(d)	 	an associated company being any company
in which the Company or any of the group
companies falling within (a) to (c) above has
a shareholding of 50% or more or any company
which has a shareholding of 50% or more in
the Company or any of the group companies
falling within (a) to (c) above

	 	 	 

	 

	 	and “Group” shall mean all such Group
Companies at such time;
	 
	 	 
	“Incapacity”

	 	any sickness or injury which prevents the
Executive from carrying out his duties;

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	“Subsidiary” and “Holding
Company”

	 	means a “subsidiary” and “holding company” as
defined in section 1159 of the Companies Act
2006 and a company shall be treated, for the
purposes only of the membership requirement
contained in subsections 1159(1)(b) and (c),
as a member of another company even if its
shares in that other company are registered
in the name of (a) another person (or its
nominee), whether by way of security or in
connection with the taking of security, or
(b) its nominee;
	 
	 	 
	“Term”

	 	means the period of the Executive’s
employment hereunder;
	 
	 	 
	“Termination Date”

	 	means the date on which the employment of the
Executive under this Agreement shall
terminate for whatever reason and derivative
expressions shall be construed accordingly;
and
	 
	 	 
	“Working Time Regulations”

	 	means the Working Time Regulations 1998.

	1.2	 	Interpretation

	 	1.2.1	 	Words and phrases which are not defined in this Agreement but which are
defined in the Act, the Companies Act 1985 or the Companies Act 2006 (as the context so
requires) or the Insolvency Act 1986 shall be construed as having those meanings.
	 
	 	1.2.2	 	References to any statute or any statutory provision shall be construed as
references to the statute or statutory provision as in force at the date of this
Agreement and as subsequently re-enacted or consolidated and shall include references
to any statute or any statutory provision of which it is a re-enactment or
consolidation.
	 
	 	1.2.3	 	Unless the context otherwise requires references in this Agreement to the
feminine gender shall, where appropriate, be deemed to include the masculine and vice
versa.
	 
	 	1.2.4	 	The Schedules to this Agreement form part of (and are incorporated into) this
Agreement.

	2	 	APPOINTMENT AND TERM
	 
	2.1	 	The Company shall employ the Executive and the Executive shall serve the Company as Managing
Director on the terms set out in this Agreement.

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	2.2	 	The Executive’s employment under this Agreement shall commence on the Effective Date and
continue (subject to the provisions of this Agreement) until terminated by either party giving
to the other not less than 12 months’ previous notice in writing.
	 
	2.3	 	The Executive represents and warrants to the Company that, by entering into this Agreement or
performing any of his obligations under it, he will not be in breach of any court order or any
express or implied terms of any contract or other obligation binding on him.
	 
	2.4	 	The Executive warrants that he is entitled to work in the United Kingdom without any
additional approvals and will notify the Company immediately if he ceases to be so entitled
during the Term.
	 
	2.5	 	The Executive’s previous employment with the Company counts as part of the Executive’s
continuous period of employment with the Company which commenced on
September 7, 2010.
	 
	3	 	DUTIES
	 
	3.1	 	During the Term the Executive shall:

	 	3.1.1	 	comply with the requirements under both legislation and regulation as to the
disclosure of inside information;
	 
	 	3.1.2	 	unless prevented by Incapacity, devote the whole of his time, attention and
abilities to the business of the Company or any other Group Company during normal
office hours and such other times as may be reasonably required for the proper
performance of his duties and he shall not be entitled to any additional remuneration
for work performed outside normal office hours. For the avoidance of doubt this clause
shall not prevent the Executive, with the prior written consent of the Company, from
holding a non-executive director position;
	 
	 	3.1.3	 	diligently exercise such powers and perform such duties as may from time to
time be assigned to him by the Board together with such person or persons as the CEO
may appoint to act jointly with him and do so in a competent manner;
	 
	 	3.1.4	 	comply with all reasonable and lawful directions given to him by the CEO;
	 
	 	3.1.5	 	promptly make such reports to the CEO in connection with the affairs of the
Company or any Group Company on such matters and at such times as are reasonably
required;
	 
	 	3.1.6	 	report his own wrongdoing and any wrongdoing or proposed wrongdoing of any
other employee, director or contractor of the Company or any Group Company to the CEO
immediately on becoming aware of it;
	 
	 	3.1.7	 	use his best endeavours to promote, protect, develop and extend the business
of the Company or any Group Company;

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	 	3.1.8	 	not knowingly do or willingly permit to be done anything to the prejudice,
loss or injury of the Company or any Group Company
	 
	 	3.1.9	 	consent to the Company monitoring and recording any use that he makes of the
Company’s electronic communications systems for the purpose of ensuring that the
Company’s rules are being complied with and for legitimate business purposes; and
	 
	 	3.1.10	 	comply with any electronic communication systems policy that the Company may issue
from time to time.

	3.2	 	The Executive will not at any time, without the prior consent of the CEO:

	 	3.2.1	 	incur on behalf of a Group Company any capital expenditure in excess of a sum
as may be authorised from time to time by the CEO; or
	 
	 	3.2.2	 	enter into, on behalf of a Group Company, any commitment, contract or
arrangement which is otherwise than in the normal course of the Group’s business or is
outside the scope of his normal duties or is of an unusual or onerous or long term
nature; or
	 
	 	3.2.3	 	engage any person on terms that he will receive remuneration in excess of an
annual rate as may be authorised from time to time by the CEO or the termination of
whose employment will require in excess of that number of months’ notice as may be
authorised from time to time by the CEO; or
	 
	 	3.2.4	 	dismiss an employee of a Group Company without giving proper notice or without
following the Group Company’s normal disciplinary procedure, and the Executive will
immediately report any dismissal effected by him and the reason for it to the CEO.

	3.3	 	For the avoidance of doubt, the Board shall be entitled at any time to appoint a further
executive, director or employee having responsibilities similar to the Executive to act
jointly with the Executive (provided that the Executive’s remuneration under this Agreement is
not affected by such appointment) and in that event the Executive shall perform his duties and
exercise his powers in a manner which shall be consistent with such appointment.
	 
	3.4	 	Notwithstanding the provisions of clause 3.1, the Company may at any time following the
giving of notice by either party to terminate this Agreement and for such period as it may
specify not exceeding the length of notice given cease to provide work for the Executive, in
which event during such period the other provisions of this Agreement including those relating
to the Executive’s remuneration shall continue to have full force and effect but the Executive
shall not, without the prior written consent of the CEO, attend his place of work or any other
premises of the Company or any Group Company (such period being “Garden Leave”). The Company
may in addition to the above:

	 	3.4.1	 	(without limitation to Schedule 2) require him not to contact or have any
communication with any clients, suppliers, agents, professional advisers,

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	 	 	 	brokers, bankers, employees or contractors of the Company or any Group Company;
and/or
	 
	 	3.4.2	 	require the Executive to resign from any or all offices, including
directorships, of any Group Company; and/or
	 
	 	3.4.3	 	revoke or suspend any powers of attorney and authorised signatories the
Executive may hold for any Group Company; and/or
	 
	 	3.4.4	 	appoint a further executive director or employee to perform the Executive’s
duties and to exercise his powers or to delegate the Executive’s duties to any other
director or employee who may exercise those powers; and/or
	 
	 	3.4.5	 	require the Executive to take any outstanding holiday time which is accrued up
to the commencement of the notice period.

	3.5	 	Notwithstanding the provisions of clause 3.1, the Company may at any time suspend the
Executive during any period, for a period of up to fifteen business days, in which the Company
is carrying out a disciplinary investigation into any alleged acts or defaults of the
Executive. During any period of suspension the Executive shall continue to receive his salary
and contractual benefits but the Executive shall not be entitled to access any premises of the
Company or any Group Company, without the prior written consent of the CEO (such period being
“Suspension”).
	 
	3.6	 	Subject always to clause 6 and the Executive’s right to hold a non executive director
position with the Company’s consent, during the Term the Executive shall not, without the
prior written consent of the CEO, engage in any activities, public office or other occupation
outside his employment which may detract from the proper and timely performance of his duties
under this Agreement. The Executive shall not hold office in any company which is not a Group
Company without the prior written approval of the CEO.
	 
	4	 	PLACE OF WORK
	 
	 	 	The Executive’s principal place of work shall be at Units 8 & 9 Saddlers Court, Oakham
Office Park, Oakham, Rutland, or such other place as may be reasonably required by the
Company from time to time for the proper performance of his duties and he shall undertake
any travel (nationally or internationally) as may be reasonably necessary for the proper
performance of his duties.
	 
	5	 	HOURS OF WORK
	 
	5.1	 	The Executive’s normal working hours shall be 8:30 AM to 4:30 PM on Monday and Friday and
8:30 AM to 5:00 PM on Tuesday, Wednesday and Thursday and such additional hours as are
necessary for the proper performance of his duties. The Executive acknowledges that he shall
not receive further remuneration in respect of such additional hours.
	 
	5.2	 	The parties each agree that the nature of the Executive’s position is such that his working
time cannot be measured and, accordingly, that the appointment falls within the scope of
regulation 20 of the Working Time Regulations.

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	6	 	CONFLICTS OF INTEREST AND DEALINGS IN SECURITIES
	 
	6.1	 	During the Term the Executive shall not whether alone or jointly with or on behalf of any
other person, firm or company and whether as principal, partner, manager, employee,
contractor, director, consultant, investor or otherwise (except as a representative or nominee
of the Company or any Group Company or otherwise with the prior consent in writing of the CEO)
be engaged, concerned or interested in any other business which:

	 	6.1.1	 	is wholly or partly in competition with any business carried on by the Company
or any Group Company; or

	 	6.1.2	 	as regards any goods or services is a supplier to or customer of the Company
or any Group Company,

	 	 	provided that the Executive may hold (directly or through nominees) by way of bona fide
personal investment any units of any authorised unit trust and up to five per cent. of the
issued shares, debentures or other securities of any class of any company whose shares are
listed on a recognised investment exchange or a designated investment exchange within the
meaning of the Financial Services and Markets Act 2000 or dealt in the Alternative
Investment Market.
	 
	6.2	 	The Executive acknowledges that he shall not enter into any transaction which contravenes the
insider dealing provisions contained in Part V of the Criminal Justice Act 1993, or the
equivalent laws or regulations of any other jurisdiction in which the Company operates,
including the United States Securities Exchange Act of 1934
	 
	6.3	 	The Executive shall at all times comply with any share dealing rules issued from time to time
by the Board or the Company for directors or officers of the Company and Group Companies,
provided he has received prior written notification of such rules.
	 
	6.4	 	The Executive agrees to disclose to the CEO any matters relating to his spouse or civil
partner (or anyone living as such), children or parents which may, in the reasonable opinion
of the CEO, be considered to interfere, conflict or compete with the proper performance of the
Executive’s obligations under this agreement.
	 
	7	 	SALARY
	 
	7.1	 	The Executive shall receive an annual salary of £100,000 (subject to the appropriate
Deductions) which shall accrue from day to day and be payable by equal monthly instalments on
or about the 27th day of each calendar month or such salary as may be agreed by the
Board on annual review in accordance with the Company’s usual practice. The Company is under
no obligation to award an increase following a salary review.
	 
	7.2	 	During the Term, the Executive will be eligible to receive, in respect of each fiscal year of
the Company, (commencing with the fiscal year ending on 31 December 2011) an annual bonus
based on targets for the Company set by the Board and the CEO in consultation with the
Executive. Targets shall be based: (a) 80% on financial metrics, which may include EBITDA and
revenue; (b) 10% on leadership characteristics, provided, that the floor for financial
targets must achieved to qualify

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	 	 	for this portion of the annual bonus; and (c) 10% on operational objectives and milestones for the
Executive tied to the Company’s business plan, provided, that the floor for financial targets must
achieved to qualify for this portion of the annual bonus. The annual bonus shall be calculated as
follows: (i) for at target performance: the annual bonus shall be an amount equal to 50% of the
Executive’s base salary; (ii) for performance at 110% of targets or higher: the annual bonus shall
be an amount equal to 60% of the Executive’s base salary; and (iii) for performance between 100%
and 110% of targets, the annual bonus shall be equal to an amount scaled ratably between 50% to
60% of the Executive’s base salary. In no event shall the Company be required to pay an annual
bonus equal to greater than 60% of the Executive’s base salary. Achievement of targets shall be
determined by the Board, in its sole discretion. If performance targets are not met, the Board
shall in good faith consider whether a full or partial annual bonus should still be paid; in such
circumstance, the Board shall consider: (i) the Executive’s individual performance and efforts;
(ii) the performance metrics achieved; and (iii) the circumstances related to the applicable
targets. The bonus payments, if any, shall be paid by the Company no later than the 15th day of
the third calendar month of the fiscal year following the fiscal year to which such annual bonus
relates.
	 
	7.3	 	Any bonus payable in accordance with clause 7.2 shall not be pensionable.
	 
	7.4	 	The Executive shall be eligible to receive stock options in Archipelago Learning, Inc., the
Company’s indirect parent, subject to the approval of the Board and in accordance with
Archipelago Learning, Inc.’s policies. Any such grants shall be made at times, in number and
on terms and conditions consistent with grants made to other division directors of Archipelago
Learning, Inc. reporting directly to the CEO.
	 
	7.5	 	The Company may deduct from the salary, or any other sums owed to the Executive, any
Deductions and any money owed to the Company or any Group Company by the Executive, including,
but without limitation to, any overpayments whether of salary, expenses or otherwise, loans or
advances made to him by the Company or any Group Company or in respect of any excess holiday
taken and the Executive agrees that such sums will be recovered as a debt.
	 
	8	 	EXPENSES
	 
	8.1	 	The Executive shall be entitled to be reimbursed for all reasonable and authorised out of
pocket expenses (including hotel and travelling expenses but excluding any car parking fines
or road traffic offence fines) reasonably incurred by him in the proper performance of his
duties, subject to the production of such receipts or other appropriate evidence as the
Company may reasonably require.
	 
	8.2	 	The Executive shall abide by the Company’s policies on expenses as communicated to him from
time to time.
	 
	9	 	BENEFITS
	 
	9.1	 	During the term of employment under this Agreement, the Executive will be entitled to
participate in all employee incentive, and welfare benefit plans and programmes made available
generally to other senior executives of the Company in the country where the Executive
resides, as such plans or programmes may be in effect from time

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	 	 	to time (including, without limitation, savings and other pension and retirement plans or
programmes, medical, dental, hospitalisation, short-term and long-term disability and life
insurance plans, accidental death and dismemberment protection, and any other pension or
retirement plans or programmes and any other employee welfare benefit plans or programmes
that may be sponsored by the Company from time to time and provided that Executive meets the
eligibility requirements and other terms, conditions and restrictions of the respective
plans and programmes, including any plans that supplement the above-listed types of plans or
programmes, whether funded or unfunded, provided that the Executive shall have no rights to
bonus, incentive compensation, incentive equity or pension benefits except as set forth in
clauses 7.2, 7.4 and 10 herein). Payment for such coverages will be the sole responsibility
of the Executive, unless the Company makes such coverages available to similarly situated
executives on a shared cost basis.
	 
	9.2	 	Provided that the Executive holds a current driving licence, the Executive shall receive a
car allowance for use of the Executive’s own car of £6,000 per annum, which shall be payable
in equal monthly instalments together with and in the same manner as the salary in accordance
with clause 7.1. The car allowance shall not be treated as part of the basic salary for any
purpose and shall not be pensionable. The Executive shall immediately inform the Company if
he is disqualified from driving and shall cease to be entitled to receive the car allowance in
such event.
	 
	10	 	PENSION
	 
	10.1	 	There is no entitlement to pensions benefit in relation to the Executive’s employment,
however the Company shall provide access to a designated stakeholder pension scheme as
required by law. The Company will match fund contributions to such stakeholder scheme up to
4% of the Executive’s annual salary as set forth in clause 7.1.
	 
	10.2	 	A contracting-out certificate is not in force in respect of the Executive’s employment.
	 
	11	 	HOLIDAYS
	 
	11.1	 	The Executive shall be entitled (in addition to the usual public and bank holidays in England
and Wales, or days in lieu where the Company requires the Executive to work on a public
holiday) to 30 days’ holiday on full pay in each holiday year to be taken at reasonable times
subject to the CEO’s reasonable discretion. If the Effective Date or Termination Date is part
way through the holiday year, or the Term is less than a full holiday year, the Executive’s
holiday entitlement shall be calculated on a pro rata basis accordingly.
	 
	11.2	 	Upon termination of the Executive’s employment the Executive shall either be entitled to
salary in lieu of any outstanding pro rata holiday entitlement or be required to repay to the
Company any salary received in respect of holiday taken in excess of his pro rata holiday
entitlement such salary to be calculated on the basis of 1/260 of the fixed annual salary
payable to the Executive pursuant to clause 7.1 for each day of outstanding or excess holiday
entitlement as appropriate.

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	11.3	 	During any notice period pursuant to clause 2.2, the CEO may require the Executive to take
any outstanding holiday entitlement. Following expiration of any notice period, if on
termination of this Agreement the Executive has:

	 	11.3.1	 	any outstanding holiday entitlement the Company will make a payment to the Executive
in lieu of that holiday entitlement subject to any deductions the Company will be
entitled to make in respect of any sums owed by the Executive to the Company; or
	 
	 	11.3.2	 	taken holiday in excess of his accrued entitlement, the Company is hereby authorised
to deduct from any sum owed by the Company to the Executive, a sum representing such
excess holiday taken.
	 
	 	11.3.3	 	For these purposes, one day’s holiday pay will be calculated as 1/260th of the
salary.

	12	 	ILLNESS OR ACCIDENT
	 
	12.1	 	The Executive shall from time to time at the request and expense of the Company submit to
medical examinations and tests by a medical practitioner nominated by the Company, the results
of which shall, subject to the provision of the Access to Medical Reports Act 1988 (as
applicable), be disclosed to the Company.
	 
	12.2	 	If the Executive is absent from his duties as a result of Incapacity for a period of seven
consecutive days or more he will at the request of the Company produce a Statement of Fitness
for Work to the Company in respect of the entire period of his absence.
	 
	12.3	 	If the Executive shall be absent owing to Incapacity so that he is unable properly to perform
his duties he shall continue to be entitled to his full salary during the first six months of
his absence and thereafter any such salary shall be paid at the discretion of the Company.
After a consecutive period of absence of three months, the Company shall be entitled at any
time to appoint a further executive director or employee to perform the Executive’s duties and
to exercise his powers. If such absence shall continue in aggregate for six months in any
rolling period of 12 months, the Company may terminate the Executive’s employment by giving
the notice specified in clause 2.2, provided that, in such event, the notice period required
pursuant to clause 2.2 shall be reduced to 6 months.
	 
	12.4	 	If the Executive’s absence shall be occasioned by the actionable negligence of a third party
in respect of which damages are recoverable the Executive shall:

	 	12.4.1	 	immediately notify the Company of all the relevant circumstances and of any claim,
compromise, settlement or judgment made or awarded in connection with those
circumstances;

	 	12.4.2	 	if the Company requires, pursue a claim against the third party and indemnify the
Company for such sum as the Company may determine, not exceeding the lesser of:

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	 	(a)	 	the amount of damages recovered by him in respect of loss
of earnings under such compromise, settlement or judgment; and
	 
	 	(b)	 	the sums paid to him in respect of the period of
incapacity.

	12.5	 	The Company shall pay the Executive all sums payable by way of statutory sick pay in
accordance with the legislation in force at the time of absence and any remuneration paid
shall be deemed to be inclusive of statutory sick pay.
	 
	12.6	 	The Executive’s entitlement under clause 12.3 will cease if at any time during the six month
period the Executive becomes eligible to receive benefits under any permanent health insurance
scheme referred to in clause 9 or any other such scheme in respect of which any Group Company
pays or has paid premiums on behalf of the Executive, in which case the Company will have no
further obligation to the Executive under this clause.
	 
	13	 	TERMINATION
	 
	13.1	 	The Company shall at all times be entitled to terminate this Agreement pursuant to clause
2.2.
	 
	13.2	 	The Company may, at its sole and absolute discretion, terminate the Executive’s employment
forthwith at any time by serving a notice under this clause stating that this Agreement is
being determined in accordance with this clause 13.2 and undertaking to pay to the Executive
salary in lieu of any required period of notice or unexpired part thereof (subject to
Deductions) together with any accrued holiday entitlement pursuant to clause 11.2. Such
payment shall be made in equal monthly instalments for the period of notice being paid, in
line with normal payroll procedure. Where the Company terminates this Agreement in accordance
with this clause 13 the terms of, inter alia, clause 14, SCHEDULE 2 and
SCHEDULE 3 shall remain in full force and effect.
	 
	13.3	 	Notwithstanding the provisions of clauses 13.1 and 13.2, the Company shall be entitled, by
notifying the Executive in writing, to terminate this Agreement and the Executive’s employment
forthwith without any payment by way of compensation, damages or otherwise if the Executive
shall:

	 	13.3.1	 	repeatedly refuse or fail to perform any of his duties and responsibilities as
determined from time to time by the CEO, including, without limitation (a) the
Executive’s persistent neglect of duty or chronic unapproved absenteeism (other than
for a temporary or permanent disability) which remains uncured to the reasonable
satisfaction of the CEO following thirty (30) days’ written notice from the Company of
such alleged fault and (b) the Executive’s refusal to comply with any lawful directive
or policy of the Company or any Group Company which refusal is not cured by the
Executive within thirty (30) days of such written notice from the Company; provided,
that the Company shall not be required to give the Executive more than two cure periods
with respect to this clause 13.3.1;

	 	13.3.2	 	act (including a failure to act) in a manner which constitutes gross and willful
misconduct or gross negligence in the performance of his duties;

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	 	13.3.3	 	commit a material act of fraud, personal dishonesty or misappropriation relating to
the Company or any Group Company;

	 	13.3.4	 	commit a material act of dishonesty, embezzlement, unauthorized use or disclosure of
Confidential Information or other intellectual property or trade secrets, common law
fraud or other fraud with respect thereto;

	 	13.3.5	 	breach a material provision of this Agreement or any other written agreement with the
Company or any Group Company;

	 	13.3.6	 	be indicted for or convicted (or enter a plea of a nolo contendere or equivalent
plea) in a court of competent jurisdiction of a felony or any misdemeanor (or the
applicable local law equivalent) involving material dishonesty or moral turpitude; or

	 	13.3.7	 	be guilty of habitual or repeated misuse of, or habitual or repeated performance of
duties under the influence of, alcohol or controlled substances.

	13.4	 	In the event clause 13.3 is exercised, for the purposes of this Agreement, the Termination
Date shall be the date on which the written notice terminating the Executive’s employment is
received by the Executive.
	 
	13.5	 	The Company will at all times be entitled to terminate this Agreement pursuant to clauses
2.2, 13.2 or 13.3 notwithstanding that such termination may prejudice the Executive’s
eligibility for or entitlement to receive statutory sick pay or benefits under any permanent
health insurance scheme or any other such scheme.
	 
	13.6	 	The proper exercise by the Company of its right of termination under clause 13.3 shall be
without prejudice to any other rights or remedies which the Company or any Group Company may
have or be entitled to exercise against the Executive.
	 
	13.7	 	If the employment of the Executive under this Agreement shall be terminated for the purpose
of reconstruction or amalgamation only whether by reason of the liquidation of the Company or
otherwise and he shall be offered employment with any concern or undertaking resulting from
this reconstruction or amalgamation on terms and conditions no less favourable than the terms
of this Agreement then the Executive shall have no claim against the Company in respect of the
termination of his employment hereunder.
	 
	13.8	 	It will be a condition of participation in any share option scheme operated by the Company or
any Group Company in which the Executive participates or will be entitled to participate that,
in the event of the termination of the Executive’s employment with the Company in
circumstances which could give rise to a claim for wrongful and/or unfair dismissal (whether
or not it is known at the time of dismissal that such a claim may ensue), the Executive will
not by virtue of such dismissal become entitled to any damages or any additional damages in
respect of any rights or expectations of whatsoever nature he may have as a holder of any
rights under such option scheme or plan.

12

 

	13.9	 	The Executive shall not at any time during any period when he is required to cease the
performance of his duties or after the Termination Date make any public statements in relation
to the Company or any Group Company or any of their officers or employees without the prior
written consent of the CEO. The Executive shall not after the Termination Date represent
himself as being employed by or connected with the Company or any Group Company.
	 
	13.10	 	All credit, charge and expense cards and all books, papers, drawings, designs, documents,
records and computer software kept or made by or in the possession or control of the Executive
relating to the businesses of the Company and any Group Company and all other property of the
Company and any Group Company are and remain the property of the Company or such Group Company
and the Executive shall deliver all such items in his possession custody or control at the
Termination Date immediately to the Company.
	 
	13.11	 	If the Executive terminates his employment with the Company with Good Reason he shall not be
obliged to serve his notice period and the Termination Date shall be the day upon which notice
of termination is delivered by the Executive. Following such termination the Company shall
pay the Executive a pro-rated bonus (calculated up to the Termination Date) and an amount
equal to his base salary for the notice period payable in equal instalments, in accordance
with the Company’s normal payroll practices, beginning with the first payroll date following
the 45th day after the Termination Date.
	 
	14	 	CONFIDENTIALITY
	 
	14.1	 	The Executive acknowledges that during the Term he shall in the performance of his duties
become aware of trade secrets and other Confidential Information relating to the Company and
any Group Company businesses and its or their clients or customers and their businesses.
	 
	14.2	 	Without prejudice to his general duties at common law in relation to such trade secrets and
other Confidential Information, the Executive shall not during the Term or at any time after
the Termination Date disclose or communicate to any person or persons or make use (other than
in the proper performance of his duties under this Agreement) and shall use his best
endeavours during the term of his employment and thereafter to prevent any disclosure,
communication or use by any other person, of any such trade secrets or Confidential
Information.
	 
	14.3	 	The provisions of this clause shall cease to apply to:

	 	14.3.1	 	information or knowledge which comes into the public domain otherwise than by reasons
of the default of the Executive;

	 	14.3.2	 	any use or disclosure authorised by the Board or required by law;

	 	14.3.3	 	information or knowledge that was in a third party’s lawful possession before
disclosure by the Executive free of any restriction as to its use or disclosure (as can
be demonstrated by the third party’s written records or other reasonable evidence) and
the third party did not obtain the same (whether directly or indirectly) from the
Executive; or

13

 

	 	14.3.4	 	information or knowledge which is developed by or for a third party at any time by
persons who have had no access to or awareness of the relevant information or
knowledge.

	14.4	 	Clause 14.2 does not prevent the Executive from making a protected disclosure within the
meaning of section 43A of the Act.
	 
	15	 	PROTECTION OF BUSINESS INTERESTS

The Executive shall be bound by the provisions of SCHEDULE 2.

	16	 	INTELLECTUAL PROPERTY RIGHTS

The Executive shall be bound by the provisions of SCHEDULE 3.

	17	 	DATA PROTECTION
	 
	17.1	 	The Executive consents to the Company or any Group Company processing data relating to the
Executive for legal, personnel, administrative and management purposes and in particular to
the processing of any sensitive personal data (as defined in the Data Protection Act 1998)
relating to the Executive, including, as appropriate:

	 	17.1.1	 	information about the Executive’s physical or mental health or condition in order to
monitor sick leave and take decisions as to the Executive’s fitness for work;
	 
	 	17.1.2	 	the Executive’s racial or ethnic origin or religious or similar information in order
to monitor compliance with equal opportunities legislation; and
	 
	 	17.1.3	 	information relating to any criminal proceedings in which the Executive has been
involved for insurance purposes and in order to comply with legal requirements and
obligations to third parties.

	17.2	 	The Company may make such information available to any Group Company, those who provide
products or services to the Company or any Group Company (such as advisers and payroll
administrators), regulatory authorities, potential or future employers, governmental or
quasi-governmental organisations and potential purchasers of the Company or the business in
which the Executive works.
	 
	17.3	 	The Executive consents to the transfer of such information to any Group Company and any Group
Company’s business contacts outside the European Economic Area in order to further their
business interests even where the country or territory in question does not maintain adequate
data protection standards.
	 
	18	 	DISCIPLINARY AND GRIEVANCE PROCEDURE

	 	18.1.1	 	The Executive is subject to the Company’s disciplinary and grievance procedures as in
effect from time to time, copies of which are available from the CEO. These procedures
do not form part of the Executive’s contract of employment.

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	 	18.1.2	 	If the Executive wishes to raise a grievance, he may apply in writing to the CEO, in
accordance with the Company’s grievance procedure.

	19	 	UNION

There are no collective agreements which directly affect the terms and conditions of the
Executive’s employment. The Executive may belong to a trade union but has no right to individual
or collective representation, other than the legal right to be accompanied during disciplinary or
grievance procedures.

	20	 	NOTICES

Any notice to be given under this Agreement shall be in writing. Notices may be served by either
party by personal service or by recorded delivery or by first class post addressed to the other
party or by leaving such notice at (in the case of the Company) its registered office for the time
being and (in the case of the Executive) his last known address as provided to the Company and any
notice given shall be deemed to have been served at the time at which the notice was personally
served or if sent by recorded delivery at the time of delivery as recorded or if sent by first
class post on the second working day after posting or in the case of being left as appropriate at
the registered office or last known address, the date on which it was so left.

	21	 	GENERAL
	 
	21.1	 	The information in this Agreement constitutes a written statement of the terms of employment
of the Executive by the Company in accordance with the provisions of the Act.
	 
	21.2	 	This Agreement (including its Schedules) constitutes the entire and only legally binding
agreement between the parties relating to the employment of the Executive by the Company or
any Group Company and replaces any previous employment agreements or arrangements.
	 
	21.3	 	No failure or delay by either party in exercising any remedy, right, power or privilege under
or in relation to this Agreement shall operate as a waiver of the same nor shall any single or
partial exercise of any remedy, right, power or privilege preclude any further exercise of the
same or exercise of any other remedy, right, power or privilege.
	 
	21.4	 	No waiver by the Company of any of the requirements of this Agreement or of any of its rights
under this Agreement shall have effect unless given in writing and signed by the Chairman or a
non executive director. No waiver of any particular breach of the provisions of this
Agreement shall operate as a waiver of any repetition of that breach.
	 
	21.5	 	If any provision of this Agreement shall be, or become, void or unenforceable for any reason
within any jurisdiction, this shall affect neither the validity of that provision within any
other jurisdiction nor any of the remaining provisions of this Agreement.
	 
	21.6	 	Except where this Agreement expressly provides otherwise, the rights, powers and remedies
provided in this Agreement are cumulative and not exclusive of any rights and remedies
provided by law and no single or partial exercise of any right or remedy

15

 

	 	 	under this Agreement or provided by law will hinder or prevent further exercise of such or
other rights or remedies.
	 
	21.7	 	No variation of this Agreement of any of the documents referred to in it shall be valid
unless it is in writing and signed by or on behalf of each of the parties.
	 
	21.8	 	This Agreement may be executed in any number of counterparts, each of which, when executed
and delivered, shall be an original, and all the counterparts together shall constitute one
and the same instrument.
	 
	21.9	 	The Contracts (Rights of Third Parties) Act 1999 shall not apply to this Agreement and no
person other than the Executive and the Company shall have any rights under it. The terms of
this Agreement or any of them may be varied, amended or modified or this Agreement may be
suspended, cancelled or terminated by agreement in writing between the parties or this
Agreement may be rescinded (in each case), without the consent of any third party.
	 
	21.10	 	This Agreement and the rights and obligations of the parties hereto shall be governed by and
construed in accordance with the laws of England and Wales.
	 
	21.11	 	In the event of any claim, dispute or difference arising out of or in connection with this
Agreement the parties hereto irrevocably agree and submit to the exclusive jurisdiction of the
Courts of England and Wales.

This Agreement has been entered into and takes effect on the date stated at the beginning of it.

	 	 	 	 	 

	EXECUTED AS A DEED by
	 	 	 	 
	EDUCATIONCITY LIMITED

	 	Mark Dubrow 

	 	 
	 

	 	 

	 	 
	 
	 	 	 	 
	acting by
	 	 	 	 
	 

	 	/s/ Mark Dubrow 

Director
	 	 
	 
	 	 	 	 
	and
	 	 	 	 
	 

	 	/s/ Malinda Passmore 

Director
	 	 

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	SIGNED AS A DEED by
	 	 	 	 
	RICHARD WHALLEY

	 	/s/ Richard Whalley    3/3/2011

	 	 
	 	 	 
	 	 
	In the presence of

	 	Kate Sanderson

	 	 
	 
	 	Name of Witness
	 	 
	

	 	 	 	 
	 
	 	 	 	 
	 
	 	 	 	 
	 	 	/s/ Kate Sanderson

	 	 
	 

	 	Signature of Witness
	 	 
	 
	 	 	 	 
	 
	 	13 Main Street	 	 
	 

	 	Whissendine

	 	 
	
	 	 
	 	
	 
	 	LEISTES	 	 
	 

	 	Address of Witness
	 	 
	 
	 	 	 	 
	 
	 	H R Manager	 	 
	 

	 	Occupation of Witness
	 	 

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SCHEDULE 1

POWER OF ATTORNEY

By this Power of Attorney made on     , 2011, I, Richard Whalley of [     ] in accordance with the
terms of the service agreement (the “Service Agreement”) of even date between myself and
EducationCity Limited (the “Company”) HEREBY APPOINT the Company to act as my attorney with
authority in my name and on my behalf (so that words and expressions defined in the Service
Agreement shall have the same meanings herein):

	1	 	to sign or execute any and all agreements, instruments, deeds or other papers and to do all
such things in my name as may be necessary or desirable to implement my obligations in
connection with clause 16 and SCHEDULE 3 of the Agreement; and
	 
	2	 	to appoint any substitute and to delegate to that substitute all or any powers conferred by
this Power of Attorney.

I declare that this Power of Attorney, having been given by me to secure my obligations in
connection with the Service Agreement, shall be irrevocable in accordance with section 4 of the
Powers of Attorney Act 1971.

IN WITNESS whereof this Power of Attorney has been duly executed.

	 	 	 	 	 	 	 

	EXECUTED as a DEED and

	 	 	)	 	 	/s/ Richard Whalley     3/3/2011
	Delivered by

	 	 	)	 	 	 
	RICHARD WHALLEY

	 	 	)	 	 	/s/ Kate Sanderson     3/3/11 
	in the presence of:

	 	 	)	 	 	 

Witness name: Kate Sanderson

Address: 13 Main Street, Whissendine, LEISTES

Occupation: HR Manager

S-2-3

 

SCHEDULE 2

PROTECTION OF BUSINESS INTERESTS

	1	 	In this Schedule the following words and expressions shall have the following meanings:
	 
	 	 	“Business” means the business or businesses of the Company or any Group Company in or with
which the Executive has been involved or concerned, including providing online instruction,
practice, assessment and/or reporting products, tools and/or services to the equivalent of
the K-12 (in the United States) education space, at any time during the Relevant Period;
	 
	 	 	“directly or indirectly” means the Executive acting either alone or jointly with or on
behalf of any other person, firm or company, whether as principal, partner, manager,
employee, contractor, director, consultant, investor or otherwise;
	 
	 	 	“Key Personnel” means any person who is at the Termination Date or was at any time during
the Relevant Period employed in the Business or engaged as a consultant in the Business, in
an executive, technical or senior managerial capacity and with whom the Executive has had
dealings other than in a de minimis way during the Relevant Period;
	 
	 	 	“Prospective Customer” means any person firm or company who has been engaged in
negotiations, with which the Executive has been personally involved, with the Company or any
Group Company with a view to purchasing goods and services from the Company or any Group
Company in the period of three months prior to the Termination Date;
	 
	 	 	“Relevant Area” means any country in which the Executive has been involved or concerned with
the Business other than in a de minimis way at any time during the Relevant Period;
	 
	 	 	“Relevant Customer” means any person firm or company who at any time during the Relevant
Period was a customer of the Company or any Group Company, with whom or which the Executive
directly dealt other than in a material way or for whom or which the Executive was
responsible on behalf of the Company or any Group Company at any time during the Relevant
Period;
	 
	 	 	“Relevant Goods and Services” means any goods and services competitive with those supplied
by the Company or any Group Company at any time during the Relevant Period in the supply of
which the Executive was directly involved or concerned in a material way at any time during
the Relevant Period;
	 
	 	 	“Relevant Period” means the Term, or the 12 months prior to the Termination Date if the
Executive’s length of employment at the Termination Date is 12 months or longer;
	 
	 	 	“Restricted Period” means the period of 12 months from the Termination Date less any period
during which the Executive has not been provided with work pursuant to clause 3.4 of this
Agreement;

2

 

	 	 	“Relevant Supplier” means any person firm or company who at any time during the Relevant
Period was a supplier of any goods or services (other than utilities and goods or services
supplied for administrative purposes) to the Company or any Group Company and with whom or
which the Executive had personal dealings during the Relevant Period; and
	 
	 	 	“Termination Date” means the date on which the employment of the Executive under this
Agreement shall terminate.
	 
	2	 	The Executive shall not without the prior written consent of the Board directly or indirectly
at any time during the Restricted Period:
	 
	2.1	 	solicit away from the Company or any Group Company;
	 
	2.2	 	endeavour to solicit away from the Company or any Group Company;
	 
	2.3	 	employ or engage; or
	 
	2.4	 	endeavour to employ or engage;
	 
	 	 	any Key Personnel.
	 
	3	 	The Executive shall not without the prior written consent of the Board directly or indirectly
at any time within the Restricted Period:
	 
	3.1	 	solicit the custom of; or
	 
	3.2	 	deal with,
	 
	 	 	any Relevant Customer or Prospective Customer in respect of any Relevant Goods or Services;
or
	 
	3.3	 	interfere; or
	 
	3.4	 	endeavour to interfere,
	 
	 	 	with the continuance of supplies to the Company and/or any Group Company (or the terms
relating to those supplies) by any Relevant Supplier.
	 
	4	 	The Executive shall not without the prior written consent of the Board directly or indirectly
at any time within the Restricted Period engage or be concerned or interested in any business
within the Relevant Area which:
	 
	4.1	 	competes; or
	 
	4.2	 	will at any time during the Restricted Period compete with the Business provided that the
Executive may hold (directly or through nominees) by way of bona fide personal investment any
units of any authorised unit trust and up to five per cent. of the issued shares, debentures
or securities of any class of any company whose shares are listed on a recognised investment
exchange or a designated investment exchange within the meaning of the Financial Services and
Markets Act 2000 or dealt in the Alternative Investment Market.

3

 

	5	 	The Executive acknowledges (having taken appropriate legal advice) that the provisions of
this Schedule are fair and reasonable and necessary to protect the goodwill and interests of
the Company and any Group Company and shall constitute separate and severable undertakings
given for the benefit of the Company and each Group Company and may be enforced by the Company
on behalf of any of them.
	 
	6	 	If any of the restrictions or obligations contained in this Schedule is held not to be valid
on the basis that it exceeds what is reasonable for the protection of the goodwill and
interests of the Company and any Group Company but would be valid if part of the wording were
deleted then such restriction or obligation shall apply with such deletions as may be
necessary to make it enforceable.
	 
	7	 	The Executive acknowledges and agrees that he shall be obliged to draw the provisions of this
Schedule to the attention of any third party who may at any time before or after the
termination of the Executive’s employment hereunder offer to engage or employ the Executive in
any capacity whether directly or indirectly, and for whom or with whom the Executive intends
to work.

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SCHEDULE 3

INTELLECTUAL PROPERTY RIGHTS

	1	 	DEFINITIONS
	 
	 	 	In this Schedule the following words and expressions shall have the following meanings:
	 
	 	 	“Copyright Work” means any work of which the Executive is the author in which copyright
subsists by virtue of the Copyright, Designs and Patents Act 1988 and any statutory
amendment or replacement thereof and which relates directly or indirectly to the business of
the Company or any Group Company or arises out of the work performed by the Executive for
the Company or any Group Company;
	 
	 	 	“Design” means any design of which the Executive is the designer in which design right
subsists by virtue of the Copyright, Designs and Patents Act 1988 and any statutory
amendment or replacement thereof and which relates directly or indirectly to the business of
the Company or any Group Company or arises out of the work performed by the Executive for
the Company or any Group Company;
	 
	 	 	“Know How” means trade secrets, confidential information, know how, technical or commercial
knowledge, manufacturing or business processes and methods which relate directly to the
business of the Company or any Group Company (the “Relevant Information”), but only to the
extent that such Relevant Information arises out of the work performed by the Executive for
the Company or any Group Company and relates specifically and solely to the operations of
the Company or any Group Company and excluding, for the avoidance of doubt, any information,
knowledge, processes or methods that are linked to the industry in which the Company or any
Group Company operates but that are not directly, specifically and solely connected to the
Company or any Group Company;
	 
	 	 	“Intellectual Property” means any Copyright Work, Design, Know How, Invention, Registered
Design or Trademark;
	 
	 	 	“Invention” means any discovery, invention or improvement in relation to goods and/or
services made by the Executive alone or with others and which relates directly or indirectly
to the business of the Company or any Group Company or arises out of work performed by the
Executive for the Company or any Group Company;
	 
	 	 	“Registered Design” means any design of which the Executive is the designer and which is
registrable pursuant to the Registered Designs Act 1949 as amended or replaced from time to
time and which relates directly or indirectly to the business of the Company or any Group
Company or arises out of the work performed by the Executive for the Company or any Group
Company; and
	 
	 	 	“Trade Mark” means any trade mark, service mark or trade name which relates directly or
indirectly to the business of the Company or any Group Company or arises out of the work
performed by the Executive for the Company or any Group Company;

S-3-1

 

	 	 	and derivative expressions shall be construed accordingly.
	 
	2	 	INVENTIONS
	 
	2.1	 	All rights in Inventions made during the Term of this Agreement whether or not the same are
made in the course of the duties of the Executive and which do not by statute belong to the
Company or any Group Company shall belong to and are hereby assigned to the Company
absolutely.
	 
	2.2	 	The Executive shall not, without the prior written consent of the Company and whether during
or after the period of his employment by the Company, disclose an Invention to any third party
or use the same for the benefit of himself or any third party but shall maintain absolute
confidentiality in relation to that Invention.
	 
	2.3	 	Immediately on making any Invention and in any event upon request by the Company, the
Executive shall disclose to the Company all information (in whatever form the same may exist)
in his possession or control relating to the Invention.
	 
	2.4	 	At the request and expense of the Company, the Executive shall execute all documents and do
all acts and things which are in the opinion of the Company necessary or desirable:

	 	2.4.1	 	to vest in the Company or any person the Company may nominate the rights
referred to in paragraph 2.1 of this Schedule;
	 
	 	2.4.2	 	to provide confirmation that a particular right in an Invention has vested in
the Company;
	 
	 	2.4.3	 	to enable applications for patents or other registered rights to be made and
prosecuted in any part of the world; and
	 
	 	2.4.4	 	to vest absolutely any patent or other registered right obtained by or on
behalf of the Executive in respect of Invention in the Company or any person the
Company may nominate.

	2.5	 	The provisions of paragraph 2 of this Schedule shall be without prejudice to the rights of
the Executive under sections 39 and 40 of the Patents Act 1977.
	 
	3	 	COPYRIGHT AND DESIGN RIGHT
	 
	3.1	 	All rights arising during the Term of this Agreement in relation to:

	 	3.1.1	 	Copyright Works;
	 
	 	3.1.2	 	Designs;
	 
	 	3.1.3	 	Registered Designs; and
	 
	 	3.1.4	 	Know How

	 	 	and which do not by statute belong to the Company or any Group Company shall belong to the
Company whether or not the work or design

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	 	 	in which such right or rights subsist was made or designed during the course of the duties
of the Executive.
	 
	3.2	 	At the request and expense of the Company, the Executive shall execute all documents and do
all acts and things which are in the opinion of the Company necessary or desirable:

	 	3.2.1	 	to vest in the Company or any person the Company may nominate the rights
referred to in paragraph 3.1 of this Schedule;
	 
	 	3.2.2	 	to provide confirmation that a particular right in a Copyright Work, Design,
Registered Design or Know How has vested in the Company;
	 
	 	3.2.3	 	to enable applications for registered rights to be made and prosecuted in any
part of the world; and
	 
	 	3.2.4	 	to vest absolutely any registered rights obtained by the Executive in respect
of any Copyright Works, Designs, Registered Designs or Know How in the Company or any
person the Company may nominate.

	3.3	 	The Executive waives all his present and future moral rights which arise under the Copyright
Designs and Patents Act 1988, and all similar rights in other jurisdictions relating to any
copyright, and agrees not to support, maintain nor permit any claim for infringement of moral
rights in such copyright works.
	 
	4	 	JOINT AUTHORSHIP AND JOINT INVENTION
	 
	4.1	 	Where any Invention is made by the Executive together with any other person or persons the
Executive shall use his best endeavours to procure that the other person or persons assign to
the Company their interest in the Invention.
	 
	4.2	 	Where the Executive is joint author or joint designer with any other person or persons of any
work, material and/or design in which any of the rights referred to in paragraph 3 of this
Schedule subsist, he shall use his best endeavours to procure that the joint authors assign
their interest in the right or rights in question to the Company.
	 
	5	 	USE OF INTELLECTUAL PROPERTY

The Company will be entitled to make such use of the Intellectual Property as it deems appropriate.
The Executive will not use the Intellectual Property in any manner, save as is necessary in
performing his duties pursuant to this Agreement, and will not disclose, or permit any third party
to use or disclose, the Intellectual Property, in any manner, at any time ether during or after
termination of this Agreement.

	6	 	REGISTRATION

The Executive shall not:

	6.1	 	register or take any steps to register any Invention, Copyright Work, Design, Registered
Design, Know How or Trade Mark with the UK Patents Office or any equivalent or similar
registration body anywhere in the world; or

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	6.2	 	register any domain name which relates directly or indirectly to the business of the Company
or any Group Company or arises out of the work performed by the Executive for the Company or
any Group Company with any domain name registration authority or body anywhere in the world.
	 
	7	 	PAPERS AND RECORDS

The Executive shall immediately after the Termination Date deliver to the Secretary of the Company
or such other person as the CEO may nominate in writing all books, papers, drawings, designs,
records and computer software in his possession or under his control at that date which relate to
or concern any Invention, or any Copyright Work, Design, Registered Design or Know How.

	8	 	ENFORCEMENT

The Executive agrees to give all necessary assistance to the Company to enable it to enforce its
intellectual property rights against third parties, to defend claims for infringement of third
party intellectual property rights and to apply for registration of Intellectual Property Rights,
where appropriate throughout the world, and for the full term of those rights.

	9	 	POWER OF ATTORNEY

The Executive shall at the time of signing this Agreement appoint as his attorney (in the form set
out in SCHEDULE 1) the Company to sign or execute any and all agreements, instruments,
deeds or other papers and do all things in the name of the Executive as may be necessary or
desirable to implement the obligations of the Executive under this Schedule.

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