Employment Agreement This Employment Agreement ("Agreement") is made between the State of Oregon acting by and through the State Board of Higher Education on behalf of the University of Oregon ("University") and Charles “Chip” Kelly (“Kelly”) and it entirely supersedes and replaces any and all prior agreements. between the parties. Article !- Purpose University and Kelly have entered into this Employment Agreement because the University desires to retain Kelly and Kelly desires to continue to work as an employee for the University. For these reasons, University has agreed to employ Kelly in a salaried position and Kelly has agreed to be employed by the University upon the following conditions: Article I~ Position 2.01. Description of Kelly's Responsibilities a. Title, Kelly is employed as Head Coach of the University's intercollegiate football team. However, Kelly's assignment is subject to the provisions in this Agreement regarding reassignment and termination. b. Duties. Kelly agrees to devote his best efforts full-time to the performance of his duties and responsibilities as head coach and such other duties as may be, from time to time, assigned to him, to give proper time and attention to furthering his responsibilities to the University and to comply with all ‘the rules, regulations, policies, and decisions established or issued by the University, the University Department of Intercollegiate Athletics (“the Athletic Department’), the Pacific-10 Conference ("PAC- 10"), or the National Collegiate Athletic Association ("NCAA"). Kelly also agrees that notwithstanding the provisions of section 4.04, during the term of this Agreement, he will not engage, directly or indirectly in any business which would detract from his ability to apply his best efforts to the performance of his duties, Kelly also agrees not to usurp any corporate opportunities of University. i General Duties and Responsibilities as Head Coach. During the period in which University ‘employs Kelly as Head Coach of the University’s intercollegiate football team, Kelly agrees to undertake and perform properly, efficiently, to the best of his ability and consonant with the standards of University, ll duties and responsibilities attendant to the position of Head Coach of the University’s football team as set forth in this Agreement. Employee is responsible for the management and administration of all phases of the intercollegiate football program in a manner that upholds the philosophies and objectives of the Athletic Department, including compliance with NCAA, PAC-10 and University rules and regulations. ‘Specific Duties and Responsibilities as Head Coach. As Head Coach of the football team, Kelly's specific and essential responsibilities include, but are not limited to, the following: ‘A. Work with student-athletes involving recruitment and selection, leadership and instruction in personal and athletic development, determining eligibility and promoting academic progress. — Employment Agreement Page 1B. Develop, submit and monitor the football program's annual budget to generate and maximize revenue to sustain the football program and to support other ancillary activities of the Athletic Department. C.—_Oversee the selection, purchase and maintenance of uniforms and equipment, within University contracts. D. Arrange and conduct practices and, in conjunction with Director of Athletics, arrange 2 competitive football game schedule including travel itineraries and plans. E. Supervise staff, including assistant and part-time coaches, graduate assistants and others, providing orientation and training 2s appropriate, conducting evaluations and recommending salaries. F. Oversee the conditioning, training and discipline of student-athletes as well as the safety of, student-athletes in team-related activities, all of which include, with the approval of the Director of, Athletics or designee, developing and publishing team rules and effectively administrating their implementation. G. Direct the team and the coaching staff at all competitive events involving the football team. ‘Schedule permitting, Kelly shall participate in clinics, exhibitions and camp activities as requested by the Director of Athletics. H. Perform the obligations of the head coach of University's intercollegiate football team regarding ‘endorsements, media availability and appearances, public relations availability and appearances and ‘other public and private appearances as reasonably requested by the Director of Athletics. Under this ‘Agreement University is acquiring Kelly's rights related to endorsements, media availability and appearances, public relations availability and appearances and other public and private appearances reasonably related to his duties and responsibilities uncer this Agreement and as head coach of University's intercollegiate football tear. I Cooperate with other Athletic Department and University staff, including other coaches. Kelly shall perform other duties as reasonably requested by the Director of Athletics. Til, Ethical Responsibilities, The University has established a tradition of ethical conduct at all levels of University life, In accordance with this tradition, Kelly agrees to represent the University in an honorable and ethical manner at all times. Standards for ethical conduct for Athletic Department staff are established and enforced by the Director of Athletics, the University, the State Board of Higher Education ("Board"), the PAC-10 Conference and the NCAA. Internal Management Directive 8.036 reflects and specifies certain requirements of the Board regarding ethical conduct 2s does University’s Potential Conflict of Interest Policy, both of which are hereby incorporated by reference in this ‘Agreement. Employee further agrees to abide by, and use his best efforts to cause his assistant coaches and other staff members he supervises to abide by, and to comply with the constitution, bylaws, and interpretations of the NCAA, and with NCAA, PAC-10 Conference and University rules and regulations relating to the conduct and administration of the football program, including recruiting rules, as now constituted or as amended at any time during the term of this Agreement. In the event Kelly becomes aware, or has reasonable cause to believe, that violations of such constitution, bylaws, interpretations, rules or regulations may have taken place, he shall report the same to the Director of Athletics promptly eee a EtIIEIIIIEIEEIEEEEIEEESEE Employment Agreement Page 2consistent with University procedures. Kelly also agrees to adhere to, to respect and to follow the academic standards, requirements and policies of the University at all times regarding the recruiting and eligibility of prospective and current student-athletes for the football program and to use his best efforts to ensure members of his staff also do so. 2.02. Reassignment, ‘The University’s intent is for Kelly to serve as the Head Coach of University’s intercollegiate football team throughout the term of this Agreement. However, the parties understand that the University retains the right to assign Kelly to other positions with different duties during the term ofthis Agreement ("reassignment"). Should such reassignment be under consideration, University shall consult with Kelly and seek Kelly's input at least thirty (30) calendar days before any reassignment is made. In ro event, however, will Kelly be assigned to any position which is not, in University’s good faith judgment, consistent with his education, expertise or experience nor will Kelly’s Base Salary be reduced uring the term of this Agreement. If the University reassigns Kelly and Kelly refuses to accept such reassignment, the University may terminate this Agreement pursuant to the terms and conditions for termination by University set forth in section 6.02 hereof. 2.03, Reporting Relationship. ‘As Head Coach of the football team, Kelly shall report to the Director of Athletics or to such other person as may be designated from time to time by the Director. Article Ill Term of Employment 3.01, Term of Agreement. a, The term of this Agreement shall begin on June 15, 2010, and end on June 14, 2016. Each period from June 15 to June 14 during the term of this Agreement and any extension thereof shall be called a "Contract Year." b. __ Ifthe University's intercollegiate football team wins at least 12 games in the 2010 season or participates in the Bow! Championship Series (BCS) Championship Game at the end of the 2010 season {in January 2011), one Contract Year shall be added to this Agreement. This additional year shall be on the terms and conditions of this Agreement in effect during the 2015-2016 Contract Year. IF the University's intercollegiate football team wins at least 12 games in the 2011 season or participates in the Bow! Championship Series (BCS) Championship Game at the end of the 2011 season {in January 2012), one Contract Year shall be added to this Agreement. This additional year shall be on the terms and conditions of this Agreement in effect during the 2015-2016 Contract Year. d. For each Contract Year beginning with the Contract Year that commences on June 15, 2012, if the University's intercollegiate football team wins at least 11 games (one of which must be a bowl game ‘win) oF wins at least 10 games (one of which must be a BCS Bow! Game win), one Contract Year shall be added to this Agreement. Any such additional year shall be on the terms and conditions of this, Agreement in effect during the Contract Year immediately preceding the additional Contract Yeer. i Employment Agreement Page 3Asticle 1V- Compensation Kelly is entitled to compensation as identified in this Agreement. Kelly may earn outside income 2 approved by the University, consistent with NCAA and PAC-10 regulations, ifany. All payments from University are subject to applicable deductions and withholding for tax purposes and employee benefit programs and are subject to the terms and conditions in Article VI and Vil regarding termination of this Agreement. 4.01, Annual Guaranteed Salary 2. University shall pay Kelly an Annual Guaranteed Salary as follows: Contract Year One: $2,400,000 Contract Year Two: $2,800,000 Contract Year Three: $3,500,000 Contract Year Four: $3,800,000 Contract Year Five: $4,000,000 Contract Year Si $4,000,000 b, Kelly's Annual Guaranteed Salary shall be payable in installments to Kelly on the regular paydays of the University. During each Contract Year, the installments shall be approximately equal. 4.02 Fringe Benefits a. Standard University Fringe Benefits: Kelly shall be entitled to participate, on the same basis as other University Officers of Administration, in University fringe benefits. These currently include (but are not limited to) group life, medical, vision, and dental insurance; paid vacation and sick leave; disability insurance; the Oregon University Systern Optional Retirement Plan and opportunities to invest a portion of salary in tax deferred annuities or deferred compensation plans. b. Expenses: Kelly will receive reimbursement for all approved business-related travel and business-related out-of-pocket expenses. c.Automobile: University shall provide at al times during the term of this Agreement while Kelly is Head Coach of the intercollegiate football team two courtesy cars for use by Kelly. Kelly must provide insurance covering personal use of all vehicles. Should University be unsuccessful in obtaining, one or both of the courtesy cars, Kelly shall receive a stipend of $500 per month per car d. Club Membership As Head Coach of the football team, Kelly will be provided with, ‘membership to the Eugene Country Club as such memberships are available. The Athletic Department will pay monthly dues and approved business-related expenses. Kelly will be responsible for any personal charges including, but not limited to, electric carts, lockers, restaurant charges, lessons, etc. This membership is provided to assist in fund-raising efforts. Should Kelly be reassigned Kelly's continued membership will depend on the wishes of the Eugene Country Club, needs of the new eS Employment Agreement Page 4Position and its relative (to certain Head Coach positions) utility to the promotions and/or to the fund- raising functions, e, Department Fringe Benefits: As Head Coach Kelly will receive, as part of the standard Athletic Department fringe benefit package: twelve season tickets to each of the University’s football team’s games and two tickets to each home game of each of the University’s other varsity intercollegiate athletic teams. In addition, University will pay the costs for Kelly’s guest to travel to all regular season awey football games. In the event the football team participates in post-season play, University agrees, to pay the costs for a guest of Kelly's and any dependent children living at home to travel to away post- season games. Kelly will be provided with use of a skybox suite during each home football game. Kelly or his designee will determine the weekly guestlist, consistent with NCAA rules and regulations. University will also provide reasonable parking accommodations for football home game events at team facilities. Kelly understands that these benefits may be subject to taxation. 4,03 Opportunities to Earn Outside Income, While Kelly is Head Coach, he shall have the opportunity to earn income from outside the University as a result of his position on the following terms and conditions: 2. General Provisions Concerning Qutside Income. The following general terms and conditions shall apply whenever Kelly wishes to earn outside income as a result of his being Head Coach of the University’s football team: i University Obligations are Primary. Any outside activities shall not interfere with the full and complete performance of Kelly's duties and obligations as a University employee, recognizing always ‘that his primary obligations lie with the University and its students. ji, NCAARules Control, Inno event shall Kelly accept or receive directly or indirectly any monies, benefit, or any gratuity whatsoever from any source whatsoever if such action would violate the constitution, bylaws, legislation, rules, or regulations of the NCAA or the PAC-10, or their respective interpretations in affect at the time. Changes to such legislation, constitution, bylaws, rules, regulations, and interpretations automatically apply to this Agreement without the necessity of written modification. ii, University Approval is Required. Kelly shall obtain the advance written approval of the Director of Athletics before receiving or entering into an agreement to receive outside income, in-kind benefits (or financial benefits. Subject to other terms of this Agreement, such approval shall not be unreasonably withheld as to arrangements not directly related to head coaching responsibilities, information and activities. Kelly shall not endorse or be @ spokesperson or celebrity personality for products or services ‘other than as permitted by the Director of Athletics. Kelly may not knowingly enter into any agreement cr participate in any activity that may involve a potential or actual conflict with his duties and obligations under this Agreement. iv, University is not Liable. University shall have no responsibility or liability for Kelly's loss of any income from any source resulting from termination of this Agreement as provided for in Articles VI or Vil or from reassignment as provided in Section 2.02, regardless of Kelly's expectations based on past occurrences or representations and regardless of whether either party could have foreseen or ——— Employment Agreement Page 5contemplated such a loss upon termination or reassignment or whether such a loss resulted indirectly from the termination or reassignment. 4.04 Other Compensation Opportunities. 2. Camps. Kelly may earn additional compensation as a result of his responsibilities operating, University’s football youth summer camp. Camp operation is subject to all the rules and procedures outlined in the Athletic Department's Procedural Manual. The opportunity to operate a camp on or using University facilities is exclusively available to Kelly only while he is actively serving as Head Coach of the football team, University shall have no responsibility or liability for loss of camp income resulting from termination of this Agreement as provided for in Articles VI or VIl or from the reassignment as provided in Section 2.02. Further, University does not guarantee any minimal camp-related income. Income shall be determined consistent with Department procedures and practices, b, Television and Radio Shows. Without University’s consent, not to be unreasonably withheld, Kelly shall not earn outside income from or participate in pre-game, post-game or coach's shows, "highlights" and other television and radio show broadcasts, podcasts, Twitter, blogs, internet, and any other form of media now existing or hereafter developed. Except for interviews or shows arranged by University, spontaneous, lve sideline interviews of thirty-seconds or less and standard interviews, Kelly shall not provide any service, commentary or performance relating to University football, whether or not such service, commentary or performance is compensated, and regardless of the form of media. Shoe, Apparel and Equipment Contracts. The Athletic Department reserves the right to deal directly with manufacturers, importers, or distributors of shoes, apparel or equipment and to negotiate and contract for usage and endorsement of their products. Kelly shall not enter into any such contracts. 4, 5 Team Performance incentives {As long as Kelly remains head football coach during the term of this Agreement, he shall be eligible for team performance incentive payments each Contract Year as set forth in Exhibit A. Team performance incentives, if earned, shall be paid within forty-five (45) days following the last post-season game in ‘which the intercollegiate football team participates. 4.06 Academic incentives, a. Graduation Success Rate. Each Contract Year during his employment as Head Coach of University's intercollegiate football team, Kelly may receive additional compensation based on the graduation rates of student-athletes, as follows: (a) if the program has a ninety percent (90%) or greater {graduation rate based on a 4-year rolling average, as determined by NCAA graduation success rate data, Kelly shall receive one hundred thousand dollars ($100,000); (b) if as determined by NCAA graduation success rate data based on a 4-year rolling average, the program achieves at least eighty and less than ninety percent (80% or greater and less than 90%) graduation rate, Kelly shall receive compensation of fifty thousand dollars ($50,000); and (c) if as determined by NCAA graduation success rate data based on 2 4-yeer rolling average, the program achieves at least seventy and less than 80 percent (70% or greater and less than 80%) graduation rate, Kelly shall receive compensation of twenty-five thousand dollars ($25,000). This incentive for graduation success rate is not cumulative. This incentive, if earned, shall be paid within forty-five (45) days of the date upon which the NCAA graduation rate data is available, OO Employment Agreement Page 6b. Grade Point Average. Each Contract Year during his employment as Head Coach of the University's intercollegiate football team, Kelly may receive additional compensation based on Grade Point Averages (GPA) of student-athletes as follows: (a) if the program has an annual GPA of greater than 3.0, Kelly shall receive one hundred thousand dollars ($100,000); (b) if the pragram has an annual GPA of between 2.75 and 2.99, Kelly shall receive fifty thousand dollars ($50,000); and (c) if the program has an annual GPA of between 2.5 and 2.74, Kelly shall receive twenty-five thousand dollars ($25,000) ‘This incentive for grade point average is not cumulative. This incentive, if earned, shall be paid within forty-five (45) days of the date upon which the team’s GPA for the relevant Contract Year is available. Academic Progress Rate. Each Contract Year during his employment as Head Coach of. University’s intercollegiate football team, Kelly may receive additional compensation based on the ‘Academic Progress Rate (APR) of the program as follows: (a) if, as determined by the NCAA, the program has an APR of 975 or greater based on a four-year rolling average, Kelly shall receive one hundred thousand dollars ($100,000); or (b) if, as determined by the NCAA, the program has an APR of at least 950 and no greater than 974 based on a four-year rolling average, Kelly shall receive fifty thousand dollars ($50,000). This incentive for APR is not cumulative. This incentive, if earned, shall be paid within forty-five days of the date upon which the NCAA APR score is available, Article V - Periodic Evaluation 5.01 Periodic Evaluations. a. The Director of Athletics or designee will evaluate Kelly’s performance of his job duties and responsibilities under this Agreement annually on the seme basis as performance evaluations are done for other Officers of Administration. These evaluations will also take Into account prior evaluations and the expectations and goals set for Kelly in such prior evaluations. b. As part of the evaluation process, win-loss record, post-season appearance performance (if any), relative recruiting success (taking into account the relative recruiting budget, location of the University, and the demographics of the Eugene area, among ather things) and relative fund-raising and revenue- ‘generating success shall be taken into account and evaluated against comparably situated and funded Division I-A intercollegiate athlatics programs. Article VI — Termination Without Cause 6.01 Automatic Termination for Death or Disability This Agreement shall terminate automatically if Kelly dies, or if Kelly becomes totally disabled (within the meaning of University’s disability insurance for Officers of Administration or within the meaning of Oregon Public Employees Retirement System (PERS) regulations or federal Social Security ‘Administration regulations). If this Agreement is terminated pursuant to this section because of Kelly’s death, Kelly's compensation and all other benefits shall terminate as of the calendar month in which death occurs, except that his estate or other designated beneficiary shall be paid all such death benefits, if any, as may be contained in any benefit plan now in force or hereafter adopted by University and due to Kelly pursuant to that Employment Agreement Page 7plan. In addition, Ur Sections 4.05 and 4.06. sity shall pay any compensation already fully earned but not yet payable under IF this Agreement is terminated pursuant to this section because Kelly becomes totally disabled, Kelly shall continue to receive the Annual Guaranteed Salary and any other standard University fringe benefits provided for under this Agreement until such time as Kelly becomes eligible for (even if subsequently paid retroactively) total disability benefits from the Public Employees Retirement System, Social Security, ofa private or group insurer, whichever first occurs. At the end of such transition period, if any, all salary and other standard University fringe benefits shall terminate. 6.02 ‘Termination by University Wit use. a. The University shall have the right to terminate this Employment Agreement prior to its then in force expiration date without cause. Termination “without cause” shall mean termination of this ‘Agreement on any basis other than those set forth in Section 7.02. Termination of Kelly without cause shall be effectuated by delivering to Kelly written notice of University’s intent to terminate this ‘Agreement without cause, which notice shall be effective upon the later of the date set forth in such notice or thirty (30) days after Kelly receives such notice. If University exercises Its right under this Section 6.02 to terminate this Agreement without cause, Kelly shall be entitled to damages only as, provided for in Section 6.02.b below. b. __Liquidated Damages Upon termination by University Without Cause. If University terminates this Agreement or any extensions of it without cause prior to its then in force expiration date, University shall pay to Kelly, as liquidated damages, his Annual Guaranteed Salary as defined in section 4.01 above for each remaining Contract Year including any year added pursuant to Section 3.01. Any partial year shall be prorated based on the number of months remaining in the Contract Year. However, if the intercollegiate football team wins five or fewer games in three consecutive seasons while Kelly is head coach, liquidated damages shall be one-half of Kelly's Annual Guaranteed Salary for each remaining Contract Year. University’s obligation shall not accrue interest (so long as not in arrears) and shall be paid on a monthly basis pro-rated aver the balance of the term of this Agreement. University’s obligations shall be subject to Kelly's duty to mitigate, as set forth in section 6.02.c. Fallure to pay timely such liquidated damages shall constitute a breach of this agreement and such sum shall be recoverable, together with reasonable attorney fees, in any state court of competent jurisdiction in the State of Oregon. Kelly will not be entitled to any other employee benefits except as otherwise provided herein or required by applicable Jaw. In no case shall University or the State of Oregon be liable for the loss of any collateral business ‘opportunities or any other benefits (including unemployment compensation), or perquisites or income resulting from activities such as but not limited to, camps, clinics, media appearances, broadcast talent fees, consulting relationships or from any other (inside-the-University or outside-the-University) sources that may ensue as a result of University's termination of this Agreement without cause. ‘The parties have bargained for and agreed to the foregoing liquidated damages provisions giving consideration to the fact that termination of this Agreement or any extension thereof by University without cause prior to such agreement's expiration date may precipitate or lead to Kelly losing certain salary, benefits, compensation or other economic advantages or income related to his employment at ‘the University, which damages are extremely difficult to determine fairly, adequately, or with certainty, —————— Employment Agreement Page 8The parties further agree that the payment of such liquidated damages by University and acceptance thereof by Kelly shall constitute sufficient, adequate and reasonable compensation to Kelly for any loss, damages or injury suffered by Kelly related to such termination by University. The foregoing shall not be, nor be construed to be, a penalty. The provisions of this Section 6.02 shall be without prejudice to any other right (excluding unemployment compensation) Kelly may have under applicable law. Mitigation of Damages by Kelly if University Terminates Without Cause. If University terminates this Agreement under this Section 6.02, Kelly agrees to mitigate University's obligations to pay liquidated damages under Section 6.02.b by making reasonable, good faith, and diligent efforts to ‘obtain comparable employment as soon as reasonably possible after termination of this Agreement. Comparable employment includes employment as a coach (not necessarily as a head coach) at a university that competes on the NCAA Division 1-A (Football Bowl Subdivision) or 1-AA (Football ‘Championship Subdivision) level or equivalent, or with a professional team. Should Kelly obtain such comparable employment, University's financial obligations under this, Agreement, including Section 6.02.b, shall cease so long as Kelly's monthly compensation from such comparable employment, excluding reasonable and usual non-monetary fringe benefits such as health and life insurance, club memberships and use of vehicles, is equal to or greater than University's obligation to pay liquidated damages under Section 6.02.b, prorated on a monthly basis. IF Kelly's monthly compensation, excluding reasonable and usual non-monetary fringe benefits, from such comparable employment is less than University's monthly obligation to pay liquidated damages under Section 6.02.b, the amount of University's obligation to pay liquidated damages shall be reduced by the amount of Kelly's compensation, excluding reasonable and usual non-monetary fringe benefits, from such comparable employment. If, after diligent efforts to obtain comparable employment as described above, Kelly obtains ‘employment that is not comparable employment, his income from such employment (plus or minus raises and adjustments) shall be off-set against University’s obligations under 6.02.b herein. Kelly shall promptly inform University of changes in his employment status (including monthly salary and type and value of fringe benefits that are included in the calculation of Kelly's compensation) for purposes of the implementation of this Section 6.02. 6.03 Termination by kelly Kelly recognizes that his promise to work for the University for the entire term of this Agreement is of the essence of this Agreement to the University. Kelly also recognizes that University is making a highly valuable investment in his continued employment by entering into this Agreement and that its investment would be lost were he to resign or otherwise terminate his employment with the University prior to the expiration of the term of this Agreement. In recognition of these facts, the parties agree that Kellys decision to terminate his employment prior to the then in force expiration date of this, ‘Agreement will be subject to the following terms and conditions: a, Written Notice. IF Kelly terminates this Employment Agreement during its term, he must give University fifteen (15) days advance written notice of the termination of his employment with the University. While Kelly is assigned to the position of Head Coach of the University’s football tear, such SS Employment Agreement Page 9termination by Kelly must occur at a time outside the football regular playing season and post-season play, if any. Simultaneous with such notice, Kelly shall inform University in writing of his employment plans following the termination of employment with University b. _Liquidated damages. If Kelly terminates this Agreement or any extensions thereof without cause and takes a college or professional football coaching jab, he shall pay to University, as liquidated damages, the following On or before the end of Contract Year One: ‘$4,000,000 After Contract Year One but on or before the end of Contract Year Two: $3,750,000 After Contract Year Two but on or before the end of Contract Year Three: $3,500,000 After Contract Year Three but on or before the end of Contract Year Four: $2,500,000 ‘After Contract Year Four but on or before the end of Contract Year Five: $2,250,000 After the Fifth Contract Year and each Contract Year thereafter: $2,000,000 © _ Kelly may prorate this amount over the remaining contract months without interest or may pre- pay in one or more lump sums. The parties recognize and agree that projection or measurement of University’s damages in such a case would be extremely difficult and that this provision is a sufficient and reasonable estimate of the potential injury to University and that it shall be enforceable as liquidated damages and not as a penalty. Provided, however, that if University’s membership In the PAC-10 Conference ends and University does not join, without a competition-season interruption, a conference of comparable stature and NCAA classification level, this subsection shall not apply. Article VIl~ Discipline and Termination for Cause 7.01 Disci kelly may be disciplined for violations of NCAA, PAC-10, Oregon Board of Higher Education or University rule or regulation as determined by the Director of Athletics. Discipline under this provision may be in addition to discipline imposed by the NCAA or the PAC-10 conference. Depending on the violation and the severity of the rule, the Director of Athletics may provide en opportunity for Kelly to remediate, impose a reprimand, assess a fine (of a day's pay o more), suspend (with or without pay) or, consistent with Section 7.02, terminate Kelly. Kelly shall cooperate fully with any University investigators in the course of any investigation of illegal or forbidden behavior on the part of students, boosters, employees, administrators, agents of the University, or volunteers. 7.02 ‘Termination by University for Just Cause. University shall have the right to terminate this Agreement (including any extensions) for just cause prior to its expiration. Employee waives any procedural rights he may have except those contained in this Agreement. If University is considering termination for cause, Kelly shall be notified ofthe grounds Employment Agreement Page 10‘and shall have an opportunity to present a statement of denial, explanation and extenuation before such termination is finalized @. Definition, “Just cause” shall include in addition to its normally understood meaning in ‘employment contracts and in OAR $80-21-32512), any of the following: (2) Adeliberate and serious violation of the duties outlined in this Agreement or refusal or Lnwillingness to perform such duties in goad faith and to the best of Kelly's abilities; (2) Conduct resulting in conviction for violation of any criminal statute involving moral turpitude or conviction of any state Class A or Class 8 felony or its equivalent under federal law; (3) Aserious and knowing violation of any law, rule, regulation, constitutional provision, bylaw, or interpretation of the University, PAC-10 Conference or the NCAA, which may, in the reasonable good faith judgment of University, reflect or impact adversely upon University or its athletic program or which may result in University being placed on probation by the PAC-10 Conference or the NCAA, including any violation which may have occurred during prior employment at another NCAA member institution either by Kelly or, if known to Kelly, by a member of the coaching staff or any other person Kelly supervises or directs; (4) Conduct by Kelly that is seriously prejudicial to the best interests of University or its athletic program or which seriously endangers the health and well-being of a student-athlete or which violates University’s mission; (5) Prolonged absence from duty without the consent of the Director of Athletics; or (6) Any cause adequate to sustain the termination of any Officer of Administration. b. University’s Obligations Upon Termination for Cause. In the event this Employment Agreement is terminated for cause in accordance with the provisions of this Section, all obligations of University to ‘make further payments and/or to provide any other consideration (notwithstanding OAR 580-21-365) shall cease as of the end of the month in which such termination occurs. In no case shall University be liable to Kelly for the loss of any collateral business opportunities or any other benefits, perquisites or income whether from University or other sources. Article VIII ~ Miscellaneous 8.01 _ This Agreement will be governed and construed in accordance with the laws of the State of ‘Oregon without regard to principles of conflicts of law. In no event shall any part of this Agreement be construed as a waiver by the State of Oregon of its sovereign and governmental immunities or limits of liability enforceable in the courts of the State of Oregon. 8.02 The captions or headings in this Agreement are for convenience only and in no way define, limit, or describe the scope or intent of any provisions of this Agreement, 8.03 The parties agree that if any term or provision of this Agreement is declared by a court of competent jurisdiction to be illegal or in conflict with any law, the validity of the remaining terms and Neen ne EEEEEEEEEEEEe Employment Agreement Page 11provisions will not be affected, and the parties agree to attempt to substitute for any illegal, invalid, or unenforceable provision a valid or enforceable one, which achieves the economic, legal and commercial objectives of the invalid or unenforceable provision to the greatest extent possible 8.04 No waiver, consent, modification, or change of any term of this Agreement shall bind either party unless the same is in writing and signed by both parties and all necessary approvals have been obtained, Such express waiver, consent, modification, ar change, if made, shall be effective only in the specific instance and for the specific purpose set forth in such signed writing. Failure of either party to enforce any provision of this Agreement shall nat constitute a waiver of the right to future enforcement of that or any other provision. 8.05 This Agreement may be executed in counterparts, and via facsimile or electronically transmitted signature (ie. emailed scanned true and correct copy of the signed Agreement), each of which will be considered an original and al of which together will constitute one and the same agreement. At the request of a party, the other party will confirm facsimile or electronically transmitted signature page by delivering an original signature page to the requesting party. 8.06 This Agreement and all previous agreements between the parties may be publicly disclosed in their entirety. 87 Kelly's position as head football coach is not tenure-related and has no academic rank 8&8 This Agreement, together with all incorporated documents and exhibits attached hereto and referenced herein, constitutes the entire agreement between the parties with respect to the subject ‘matter hereof and merges all prior and contemporaneous communications with respect to such subject ‘matter. This Agreement shall not be modified except by a signed writing dated subsequent to the date Of this Agreement and signed by Kelly and on behalf of University by its duly authorized representative. ‘The parties hereby acknowledge and agree that this Agreement has been negotiated by the parties and their respective counsel and shall be interpreted fairly in accordance with its terms and without any strict construction in favor of or against either party. 8&9 Allnotices, claims, requests, demands and other communications hereunder shall be made in writing and shall be deemed given if delivered or mailed (registered or certified mail, postage prepaid, return receipt requested) as follows: To Kelly Last Known Address on File with University Human Resources Copy to: David Dunn Athletes First 9140 Irvine Center Drive Irvine, CA 92618 Phone: 949-475-2222 Tothe University: Director of Athletics University of Oregon 2727 Leo Harris Parkway ne Employment Agreement Page 12Eugene, OR 97401 Phone: 541-346-4484 Fax: 541-346-5031 8.10 University reasonably believes and will use good faith efforts to ensure that its Department of Athletics will have sufficient funds to perform its duties and obligations under this Agreement. Its University’s intention, agreement and obligation to perform its duties and obligations under this ‘Agreement if funds are legally available, but University is excused from performing its duties and. obligations only to the extent and only for the period that funds are not legally available. University represents and warrants to Kelly that this Agreement is important to the operation of the Department of Athletics and that it anticipates that the revenues of the Department of Athletics, or funds made available to the Department of Athletics by University's affiliated foundation, will be sufficient to make both the compensation payments to Kelly throughout the term of this Agreement (including years added pursuant to Section 3,01) and any sums payable to Kelly for University's breach or termination of this Agreement. If, despite the above, University is not allotted sufficient funds for a fiscal period by appropriation, limitation, grant, or other fund source lawfully available to it for purposes of continuing to perform its duties and obligations under this Agreement, University shall notify Kelly in writing of the unavailability of funds to perform this Agreement. Within 60 days after receiving such notice from the University, Kelly may elect to terminate the Agreement without liability by written notice to University. Signature Page Follows ———— —— Employment Agreement Page 13,The parties indicate their acceptance of and agreement to the terms and conditions of this Employment Agreement by their signatures below. a. 24D Charles E. Kelly University of Oregon LA Rob Mullens Date Director President Extuits Exhibit A: Team Performance Incentives See Employment Agreement Page 14stated quawaassy wauiAojaw3 eee ono‘oars o0'o0ts. ono'o0z$ oo0'o07s o0o'oo7s o00'o0zs luoseas seinaa Ut SuIAA ZT 00'09$ o00'03$ OTT 8upjuey dy jeuls o00's7s 00's {e¥) 2894 atp Jo ypeo9 jeuonen ooo'ses ooo'oats o90'00Ts suo|dusey> OT- We oo0'osts ooo‘osz¢ ooo'0szs ooo'oses awe diysuoidwey s3@ Uinn ‘S3ALLN39NI JONVIVYOSY3d YIHLO oo'oors ooo'o0rs, ooo'ses o00'ses ooo'oors ooo'o0rs wea diysuoidweys soe ov0'0ss oo0'ses 000'ses ‘8ue) ae S99 10 7 "TH OT Dvd Moe ovo'0ss, ooo'oss eh OT Dvd Mog saoNvevaddy MOS wy | aR amg - ENT - mT 7 3g TeSKBEHUES TER nae poy ™S SAALNZONI JONVINNOS¥3d WAL vy Liglaxa