Exhibit 10.1
EMPLOYMENT AGREEMENT
          THIS EMPLOYMENT AGREEMENT (this “Agreement”) is made and is effective
as of July 5, 2006, (the “Effective Date”) by New Horizons Worldwide, Inc., a
Delaware corporation (the “Employer”), and Mark A. Miller, an individual (the
“Executive”).
RECITALS
          A. The Employer desires to engage the Executive’s services as the
President and Chief Executive Officer of the Employer and the Executive wishes
to accept such employment upon the terms and conditions set forth herein
including, without limitation, the covenants and agreements of the Executive set
forth in Sections 7 and 8 hereof.
          B. Based upon inducements described in this Agreement, the Executive
intends to forego other employment-related opportunities and desires to be
employed as an employee of the Employer.
AGREEMENT
          In consideration of the foregoing and the mutual promises and
covenants set forth herein, the parties, intending to be legally bound, agree as
follows:
     1. Definitions.
          For the purposes of this Agreement, the following terms have the
meanings specified or referred to in this Section 1.
          “Affiliate(s)” — any Person directly or indirectly controlled by, or
under common control with, the Employer or any other referenced Person.
          “Agreement” — this Employment Agreement, including any Exhibits
hereto, as amended from time to time.
          “Annual Performance Bonus” — as described in Section 3.3.
          “Benefits” — as described in Section 3.1(b).
          “Board of Directors” — the Board of Directors of the Employer.
          “Cause” — any of the following which occur during the Employment
Period: (i) any fraud, misappropriation or embezzlement by the Executive in
connection with the business of the Employer or any Affiliate; (ii) any act of
gross negligence, gross corporate waste or extreme disloyalty by the Executive
with respect to, or the commission of any intentional tort by the Executive
against, the Employer or any Affiliate; (iii) any conviction of or nolo
contendere

 

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plea to a felony or a first degree misdemeanor by the Executive that has or can
reasonably be expected to have a material detrimental effect on the Employer or
any Affiliate; (iv) repeated absenteeism (other than medical leave, disability
leave or other approved absence), illegal drug use or excessive alcohol
consumption by the Executive; (v) any gross neglect or persistent neglect by the
Executive to perform the duties of his employment, provided that the Executive
shall first have received a written notice which sets forth in reasonable detail
the manner in which the Executive has grossly or persistently neglected such
duties and shall have failed to cure the same within a period of 30 days after
such notice is given unless the same cannot reasonably be cured within said
30-day period, in which event the Executive shall have up to an additional
90 days to cure the same so long as the Executive is diligently seeking to cure
the same, and provided, further, that the Employer shall not be required to give
written notice of, nor shall the Executive have a period to cure, the same or
any similar gross neglect or persistent neglect as to which the Employer shall
have previously given written notice and which the Executive shall have
previously cured; (vi) any public conduct by the Executive that has or can
reasonably be expected to have a material detrimental effect on the Employer or
any Affiliate and which cannot be substantially cured by Executive within a
period of thirty (30) days; or (vii) any voluntary resignation or other
termination of employment effected by the Executive under circumstances in which
the Employer could effect such termination as a result of any of the foregoing.
          “Change of Control” — the occurrence of any of the following events:
(i) an acquisition (other than directly from Employer) of any voting securities
of the Employer (the “Voting Securities”) by any “person” or “group” (within the
meaning of Section 13(d)(3) or 14(d)(2) of the Securities Exchange Act of 1934)
other than an employee benefit plan of Employer, immediately after which such
Person of Group has “Beneficial Ownership” (within the meaning of Rule 13d3
under the Exchange Act) of more than fifty percent (50%) of the combined voting
power of Employer’s then outstanding Voting Securities; (ii) within any 12 month
period, the individuals who were directors of the Employer as of August 1, 2006
(the “Incumbent Directors”) ceasing for any reason other than death, disability
or retirement to constitute at least a majority of the Board of Directors,
provided that any director who was not a director as of the date the Board of
Directors approved this Agreement shall be deemed to be an Incumbent Director if
such director was appointed or nominated for election to the Board of Directors
by, or on the recommendation or approval of, at least a majority of directors
who then qualified as Incumbent Directors, provided further that any director
appointed or nominated to the Board of Directors to avoid or settle a threatened
or actual proxy contest shall in no event be deemed to be an Incumbent Director;
(iii) consummation of a merger, consolidation, or reorganization involving
Employer that results in the stockholders of Employer immediately before such
merger, consolidation or reorganization owning, directly or indirectly,
immediately following such merger, consolidation or reorganization, less than
fifty percent (50%) of the combined voting power of the corporation which
survives such transaction as the ultimate parent entity; or (iv) a sale of all
or substantially all of the assets of Company. Notwithstanding the foregoing, a
“Change of Control” shall not include any transaction or series of related
transactions pursuant to which Camden Partners Strategic Fund III, L.P., Camden
Partners Strategic Fund III-A, L.P., or any of their respective Affiliates
increases its individual or collective direct or indirect ownership of the
Company
          “Code” — the Internal Revenue Code of 1986, as amended.

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          “Compensation” — Salary, Benefits, Guaranteed Bonus, and Annual
Performance Bonus.
          “Compensation Committee” — the Compensation Committee of the Board of
Directors.
          “Confidential Information” — information of any type, not generally
known, about the business, processes, services, products, suppliers, customers,
decisions, or plans of the Employer, any Affiliate or any customer thereof
(regardless of whether a confidentiality agreement with such customer has been
executed), which is used or useful in the conduct of the business of the
Employer or an Affiliate or which confers or tends to confer a competitive
advantage over one who does not possess such information. Such information
includes, but is not limited to: designs, processes, procedures, formulae and
improvements; information relating to trade secrets, know-how, research,
development, design, engineering, quality control or service techniques;
information about existing, new or envisioned products, processes or services,
their development or performance; information relating to quotation, purchasing,
accounting, sales, marketing, or pricing, including financial or business
planning information, financial statements and forecasts, business plans,
product pricing information and customer and supplier lists; marketing programs
and methods; and computer software and programs (including object code and
source code).
          “Conflicts of Interest” — any activity which creates a conflict
between the personal interests of the Executive and the interests of the
Employer or an Affiliate, including, but not limited to: (i) owning a financial
interest in any Person which does business with the Employer or an Affiliate
(except where such interest consists of ownership of securities in a publicly
owned corporation); (ii) rendering services to any Person which does business
with the Employer or an Affiliate; (iii) accepting gifts (of more than token
value), loans (other than from established financial institutions), excessive
entertainment, or other substantial favors from any Person which does business
or is seeking to do business with the Employer or an Affiliate;
(iv) representing the Employer or an Affiliate in any transaction in which the
Executive has a substantial interest; (v) using Confidential Information for
personal gain; (vi) competing with the Employer or an Affiliate, directly or
indirectly, in the purchase or sale of property, products, or services; and
(vii) transacting personal business with any Person so as to cause such Person
to believe it is dealing with the Employer or an Affiliate rather than the
Executive as an individual.
          “Disability” — as defined in Section 6.3.
          “Effective Date” — July 5, 2006.
          “Employee Invention” — any idea, invention, technique, modification,
process, or improvement (whether patentable or not), and any work of authorship
(whether or not copyright protection may be obtained for it) created, conceived,
or developed by the Executive, either solely or in conjunction with others,
during the Employment Period, or a period that includes a portion of the
Employment Period, that directly relates to the Executive’s duties or the
business then being conducted or proposed to be conducted by the Employer, and
any such item created

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by the Executive, either solely or in conjunction with others, following
termination of the Executive’s employment with the Employer, that is based upon
or uses Confidential Information; provided, however, that any item so created by
the Executive that is based upon or uses Confidential Information that the
Executive demonstrates was or became generally available to the public, other
than as a result of a disclosure by the Executive, will not be deemed to be an
Employee Invention for any purposes.
          “Employer” — New Horizons Worldwide, Inc., including its successors
and assigns.
          “Employment Period” — the period of the Executive’s employment under
this Agreement.
          “Franchisee” — the franchises of New Horizons Franchising Group, Inc.,
an Affiliate of the Employer, and its successors and assigns.
          “Good Reason” — as defined in Section 6.1(d).
          “Guaranteed Bonus” — as defined in Section 3.2.
          “Initial Contract Period” — as defined in Section 2.2.
          “Noncompetition Period” — the period of time equal to the Employment
Period, plus one (1) year from the date of the Executive’s termination of
employment with the Employer and all Affiliates.
          “Person” — any individual, corporation (including any non-profit
corporation), general or limited partnership, limited liability company, joint
venture, estate, trust, association, organization, or governmental body.
          “Proprietary Items” — as defined in Section 7.2(a)(iv).
          “Related Agreements” means any stock option or other equity based
agreement(s) by and between the Executive and the Employer or an Affiliate of
the Employer.
          “Salary” — as defined in Section 3.1(a).
          “Subsequent Contract Period(s)” — as defined in Section 2.2.
     2. Employment Term and Duties.
          2.1 Employment. The Employer hereby employs the Executive, effective
as of the Effective Date, and the Executive shall accept employment by the
Employer, as of the Effective Date, upon the terms and conditions set forth in
this Agreement.
          2.2 Term. Subject to the provisions of Section 6, Executive’s
employment under this Agreement shall commence on the Effective Date and
continue until terminated

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pursuant to the terms hereof. The period commencing on the Effective Date and
ending December 31, 2006 is herein referred to as the “Initial Contract Period”
and each of the calendar years thereafter are herein referred to separately as a
“Subsequent Contract Period” or collectively as the “Subsequent Contract
Periods.”
          2.3 Duties. The Executive will have such duties as are assigned or
delegated to the Executive by the Board of Directors of the Employer and will
serve as the Chief Executive Officer of the Employer commencing on the Effective
Date and as President commencing on the earlier of August 1, 2006 or the
effective date of Thomas J. Bresnan’s resignation as President. The Executive
will devote his entire business time, attention, skill, and energy exclusively
to the business of the Employer and its Affiliates, as the case may be, will use
his best efforts to promote the success of the such business, and will cooperate
fully with the Board of Directors of Employer, as the case may be, in the
advancement of the best interests of the Employer and its Affiliates.
Notwithstanding the foregoing, Executive shall be permitted to continue to serve
in those fiduciary positions which he currently holds and which he has disclosed
in writing to the Chairman of the Board of Directors of the Employer. In
addition, at all times during the Employment Period, the Executive shall be
nominated for election as a member of the Board of Directors of the Employer.
     3. Compensation.
          3.1 Basic Compensation.
               (a) Salary. The Executive will be paid a salary at an annualized
rate of $335,000.00 per year, subject to the provisions of Section 6, and as may
be increased as provided below (the “Salary”). The Salary will be payable in
equal periodic installments according to the Employer’s customary payroll
practices, but not less frequently than monthly. The Salary will be reviewed by
the Board of Directors or Compensation Committee of the Employer not later than
June 1, 2007, and not less frequently than annually thereafter prior to the
commencement of each Subsequent Contract Period. Any increase in the Salary
shall be made by, and at the sole discretion and approval of, the Board of
Directors or Compensation Committee.
               (b) Benefits. The Executive will be entitled to participate in
such pension, deferred compensation, profit sharing, bonus, life insurance,
hospitalization and medical and dental plans or insurance coverage, disability,
and other employee benefit plans, programs and policies of the Employer which
are made available to the executive officers of the Employer on or after the
Effective Date (collectively, “Plans”) if and to the extent that such Plans are
or remain in effect and the Executive is eligible under the terms thereof. All
of the plans, agreements, and undertakings of Employer set forth above are
herein collectively referred to as the “Benefits.” Any Benefits hereunder shall
be subject to such local, state or federal tax reporting requirements as may be
in effect at any time during the Employment Period. In addition, following the
establishment of the Office of the President as hereinafter provided, Employer
shall provide Executive with an automobile allowance for all costs associated
with the use and operation of such automobile in the amount of One Thousand
Dollars ($1,000) per month.

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          3.2 Initial Contract Period Bonus. The Executive shall be paid not
less than a $75,000 bonus (the “Guaranteed Bonus”) for the initial development
of the Employer’s new business strategy and achievement of other objectives as
determined by the Board of Directors or Compensation Committee in consultation
with the Executive. Any bonus in excess of the Guaranteed Bonus shall be payable
at the sole discretion of the Board of Directors or Compensation Committee. The
Guaranteed Bonus (and any additional bonus) shall be paid by the Employer to the
Executive not later than February 28, 2007.
          3.3 Annual Performance Bonus.
               (a) Determination. As additional incentive compensation for the
services to be rendered by the Executive pursuant to this Agreement, beginning
with the first Subsequent Contract Period, the Executive shall be eligible each
year during the Employment Period to receive a bonus (the “Annual Performance
Bonus”). The Annual Performance Bonus, if any, will be based upon performance
during that year against one or more quantitative financial goals for the
Employer and/or its Affiliates. All such goals and the weight to be given to
each in determining the Executive’s Annual Performance Bonus shall be determined
by the Board of Directors or Compensation Committee of the Employer in
consultation with the Executive. The determination of the Executive’s
achievement of such goals shall be made by the Board of Directors or
Compensation Committee in its good faith discretion, and any such determination
shall be final and binding on the Executive. It is understood and agreed that if
the goal for determination of the Annual Performance Bonus is fully satisfied,
or if the goals for such determination are fully satisfied on the agreed
weighted average basis, then the amount of such bonus shall not be less than one
hundred percent (100%) of the Executive’s then current Salary. Opportunities for
an Annual Performance Bonus less than the foregoing parameter amounts (i.e.,
less than one hundred percent (100%) of the Executive’s then current Salary)
shall be determined by the Board of Directors or Compensation Committee in
consultation with the Executive at the time the goal(s) for the year are
established.
               (b) Payment. Notwithstanding anything to the contrary herein, in
order to receive any Annual Performance Bonus with respect to a given year, the
Executive must be employed by the Employer (or any of its Affiliates) through
the month of December of that year. Any Annual Performance Bonus that is to be
paid to the Executive hereunder shall be paid not later than the first to occur
of either (i) the date of receipt by Employer of audited financial statements
for the year to which the Annual Performance Bonus relates or (ii) March 31 of
the year following the year to which the Annual Performance Bonus relates.
     4. Expenses. The Employer will pay or reimburse the Executive for
reasonable business expenses incurred by him on behalf of the Employer or an
Affiliate in the performance of his duties, provided that the Executive
furnishes the Employer with such documentation as the Employer may reasonably
request, including such documentation as may be required by the Code or the
regulations thereunder.
     5. Relocation and Other Expenses. In order to facilitate the Executive’s
immediate start and ability to spend the necessary time at the Employer’s
headquarters in Orange County, California, and his acceptance of employment with
the Employer upon the terms and conditions set forth herein, the Employer agrees
to pay or reimburse the Executive for the expenses set forth

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on Exhibit A, provided that the Executive furnishes the Employer documentation
of such expenses reasonably satisfactory to the Employer and as may be required
by the Code or the regulations thereunder. Prior to July 5, 2007, the Employer
shall establish an office for the Executive and other personnel of Employer
and/or its Affiliates as hereinafter determined at a mutually agreed upon
location in the mid-Atlantic region of the United States (the “Office of the
President”).
     6. Termination.
          6.1 Events of Termination.
               (a) Death; Disability. In the event of the Executive’s death or
Disability, his employment with the Employer shall be deemed terminated as of
the end of the thirty (30) day period after which such death or Disability
occurs, and all rights, duties and obligations of the parties hereunder shall
thereupon cease, except for the Executive’s obligations under Section 7 and
Section 8 hereof (in the case of a termination due to Disability), and the
Employer’s obligations under Sections 6.2(a) hereof.
               (b) By the Employer for Cause. The Executive’s employment with
the Employer may be terminated at the option of and by written notice from the
Employer if the Board of Directors finds Cause for termination. Upon any such
termination all rights, obligations and duties of the parties hereunder shall
immediately cease (including, but not limited to, the payment by the Employer of
all Compensation), except for the Executive’s obligations under Section 7 and
Section 8 hereof.
               (c) By the Employer Without Cause. The Employer may also
terminate the Executive’s employment at any time upon not less than thirty
(30) days advance written notice without Cause. Upon expiration of such notice
period all rights, obligations and duties of the parties hereunder shall
immediately cease, except for the Executive’s obligations under Section 7 and
Section 8 hereof and the Employer’s obligations under Section 6.2(b).
               (d) By the Executive For Good Reason. Executive may terminate his
employment hereunder at any time for Good Reason upon not less than thirty
(30) days advance written notice to the Employer. For purposes of this
Agreement, “Good Reason” shall mean (i) a material reduction in the position or
responsibilities of the Executive including but not limited to a failure of
Executive to be elected to the Board of Directors of Employer on or before
August 1, 2006; (ii) a reduction in the compensation or material reduction in
the benefits of Executive; (iii) a substantial failure of Employer to perform
any material provision of this Agreement, provided that the Employer shall first
have received a written notice which sets forth in reasonable detail the manner
in which the Employer has substantially failed to perform such provision and
shall have failed to cure the same within a period of 30 days after such notice
is given unless the same cannot reasonably be cured within said 30-day period,
in which event the company shall have up to an additional 90 days to cure the
same so long as the Employer is diligently seeking to cure the same, and
provided, further, that the Executive shall not be required to give written
notice of, nor shall the Employer have a period to cure, the same or any similar
substantial failure of performance as to which the Executive shall have
previously given written notice and which the Employer shall have previously
cured;; or (iv) failure by Employer to relocate the office of the

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President as provided in Section 5 above or a further relocation of the Office
of the President to a distance of more than seventy-five (75) miles from its
relocation as provided in Section 5 above, unless such relocation results in
Employer’s executive offices being closer to Executive’s then primary residence
or does not substantially increase the average commuting time of Executive.
               (e) By the Executive Without Good Reason. The Executive may
terminate his employment with the Employer without Good Reason upon not less
than thirty (30) days advance written notice to the Employer, provided, however,
that after the receipt of such notice, the Employer may, in its discretion,
accelerate the effective date of such termination at any time by written notice
to the Executive. Upon the effective date of any such termination, all rights,
obligations and duties of the parties hereunder shall immediately cease, except
for the Executive’s obligations under Section 7 and Section 8.
               (f) By the Executive Upon a Change of Control. The Executive
shall be deemed to have elected to terminate his employment, and the Employment
Period shall end, upon a Change of Control, unless the Executive provides
written notice to the contrary to the Employer in advance of or commensurate
with the Change of Control.
          6.2 Termination Pay. Effective upon the termination of the Employment
Period, the Employer will be obligated to pay the Executive (or, in the event of
his death, his designated beneficiary) only such compensation as is provided in
this Section 6.2. For purposes of this Section 6.2, the Executive’s designated
beneficiary will be such individual beneficiary or trust, located at such
address, as the Executive may designate by notice to the Employer from time to
time or, if the Executive fails to give notice to the Employer of such a
beneficiary, the Executive’s estate.
               (a) Termination by Death or Disability. If the Employment Period
is terminated as a result of the Executive’s death or Disability, the Employer
will pay to the Executive’s designated beneficiary the Executive’s Salary for
the thirty (30 day period after which the death or Disability (as determined
under Section 6.3) occurred.
               (b) Termination by the Employer Without Cause or by Executive for
Good Reason. If the Employer terminates the Executive’s employment without Cause
or if Executive terminates his employment for Good Reason, the Employer will
continue to pay the Executive his Salary and provide or reimburse the Executive
for medical, eye care and dental insurance comparable to that by which the
Executive was covered at the date of termination for a period of twelve
(12) months.
               (c) Termination upon a Change of Control. If the Executive’s
employment is terminated upon a Change of Control pursuant to Section 6.1(f),
and the total consideration paid in connection with the transaction, or the fair
market value of the Employer in the event of a Change of Control described in
clause (ii) in the definition of “Change of Control” set forth in Section 1, is
less than twenty-five million dollars ($25,000,000), the Employer will pay the
Executive a lump sum payment equal to twelve (12) months Salary plus an amount
equal to the most currently paid Annual Performance Bonus, or, if Executive has
not been employed by Employer long enough for an Annual Performance Bonus to
have been calculated, an amount

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equal to one year of Annual Salary, and will continue to provide or reimburse
the Executive for medical, eye care and dental insurance comparable to that by
which the Executive was covered at the date of termination for a period of
twelve (12) months. If the Executive’s employment is terminated upon a Change of
Control pursuant to Section 6.1(f), and the total consideration paid in
connection with the transaction, or the fair market value of the Employer in the
event of a Change of Control described in clause (ii) in the definition of
“Change of Control” set forth in Section 1, is equal to or greater than
twenty-five million dollars ($25,000,000), the Employer will pay the Executive a
lump sum payment equal to twenty-four (24) months Salary plus an amount equal to
the two most currently paid Annual Performance Bonuses, or, if Executive has not
been employed by Employer long enough for two Annual Performance Bonuses to have
been calculated, plus an amount equal to two additional years annual Salary, and
will continue to provide or reimburse the Executive for medical, eye care and
dental insurance comparable to that by which the Executive was covered at the
date of termination for a period of twenty-four (24) months. Regardless of the
amount of the total consideration paid or the fair market value of the Employer,
as the case may be, the Employer will pay for career transition services for
Executive at a provider of Executive’s choice, the cost of which will not exceed
twenty-five thousand dollars ($25,000).
               (d) Termination by the Executive Without Good Reason. If the
Executive terminates his employment without Good Reason, then, regardless of
whether the Employer accelerates the effective date of such termination (as
contemplated by Section 6.1(e) above), the Employer shall continue to pay to the
Executive his Salary, in accordance with normal payroll practices, to and
through the expiration of the notice period that is required by Section 6.1(e)
and was provided by the Executive with respect to his termination.
          6.3 Determination of Disability. For purposes of this Agreement,
“Disability” shall mean any physical or mental impairment (i) because of which
the Executive is unable to perform the principal duties of his employment for a
period of at least 120 consecutive days or for 180 days during any twelve
(12) month period, or (ii) which, in the judgment of the Board of Directors
based on a written certification of a physician (reasonably acceptable to
Employer and Executive or Executive’s personal representative) renders the
Executive incapable of performing the principal duties of his employment. The
determination of the medical doctor selected under this Section 6.3 will be
binding on both parties. The Executive must submit to a reasonable number of
examinations by the medical doctor making the determination of disability under
this Section 6.3, and the Executive hereby authorizes the disclosure and release
to the Employer of such determination and all supporting medical records. If the
Executive is not legally competent, the Executive’s legal guardian or duly
authorized attorney-in-fact will act in the Executive’s stead for the purposes
of selecting the medical doctor, submitting the Executive to the examinations,
and providing the authorization of disclosure as required under this Section 6.3
If Employer and Executive (or Executive’s representative) are unable to agree
upon an acceptable physician, then the determination of Disability shall be made
by the majority vote of a panel of three (3) physicians, one selected by
Employer, one by Executive (or Executive’s representative) and the third
selected by the first two.

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     7. Confidentiality; Employee Inventions.
          7.1 Acknowledgments by the Executive. The Executive acknowledges that
(i) during the Employment Period and as a part of his employment, the Executive
will be afforded access to Confidential Information; (ii) public disclosure of
such Confidential Information could have an adverse effect on the Employer or an
Affiliate and its or their business; (iii) since the Executive possesses
substantial expertise and skill with respect to the Employer’s business, the
Employer desires to obtain exclusive ownership of each Employee Invention, and
the Employer will be at a substantial competitive disadvantage if it fails to
acquire exclusive ownership of each Employee Invention; (iv) the Compensation
provided to Executive hereunder constitutes good and sufficient additional
consideration for the Executive’s agreements and covenants in this Section 7;
and (v) the provisions of this Section 7 are reasonable and necessary to prevent
the improper use or disclosure of Confidential Information and to provide the
Employer with exclusive ownership of all Employee Inventions.
          7.2 Covenants of the Executive. In consideration of the Compensation
to be paid or provided to the Executive by the Employer under this Agreement,
the Executive covenants as follows:
               (a) Confidentiality.
                    (i) During and at all times following the Employment Period
the Executive will hold in confidence the Confidential Information and will not
disclose it to any person or use it for any purpose except with the specific
prior written consent of the Employer or except as otherwise expressly permitted
by the terms of this Agreement.
                    (ii) Any trade secrets of the Employer or an Affiliate will
be entitled to all of the protections and benefits under applicable trade secret
laws. If any information that the Employer deems to be a trade secret is found
by a court of competent jurisdiction not to be a trade secret for purposes of
this Agreement, such information will, nevertheless, be considered Confidential
Information for purposes of this Agreement. The Executive hereby waives any
requirement that the Employer or an Affiliate submit proof of the economic value
of any trade secret or post a bond or other security.
                    (iii) None of the foregoing obligations and restrictions
applies to any part of the Confidential Information (A) that the Executive
demonstrates was or became generally available to the public other than as a
result of a disclosure by the Executive, or (B) that is required to be disclosed
by law, provided that the Executive shall consult with the Employer concerning
such disclosure in advance and cooperate with any reasonable protective measures
sought by the Employer.
                    (iv) The Executive will not remove from the Employer’s (or
any Affiliate’s) premises (except to the extent such removal is for purposes of
the performance of the Executive’s duties at home or while traveling, or except
as otherwise specifically authorized by the Employer) any document, record,
notebook, plan, model, component, device, or computer software or code, whether
embodied in a disk or in any other form (collectively, the “Proprietary Items”).
The Executive recognizes that, as between the Employer (or an Affiliate)

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and the Executive, all of the Proprietary Items, whether or not developed by the
Executive, are the exclusive property of the Employer (or the applicable
Affiliate). Upon termination of this Agreement by either party, the Executive
will return to the Employer (or the applicable Affiliate) all of the Proprietary
Items in the Executive’s possession or subject to the Executive’s control, and
the Executive shall not retain any copies, abstracts, sketches, or other
physical embodiment of any of the Proprietary Items.
               (b) Employee Inventions. Each Employee Invention will belong
exclusively to the Employer (or the applicable Affiliate). The Executive
acknowledges that all of the Executive’s writing, works of authorship, and other
Employee Inventions are works made for hire and the property of the Employer (or
the applicable Affiliate), including any copyrights, patents, or other
intellectual property rights pertaining thereto. If it is determined that any
such works are not works made for hire, the Executive hereby assigns to the
Employer (or the applicable Affiliate) all of the Executive’s right, title, and
interest, including all rights of copyright, patent, and other intellectual
property rights, to or in such Employee Inventions. The Executive covenants that
he will promptly:
                    (i) disclose to the Employer in writing any Employee
Invention;
                    (ii) assign to the Employer or to a party designated by the
Employer, at the Employer’s request and without additional compensation, all of
the Executive’s right to the Employee Invention for the United States and all
foreign jurisdictions;
                    (iii) execute and deliver to the Employer such applications,
assignments, and other documents as the Employer may request in order to apply
for and obtain patents or other registrations with respect to any Employee
Invention in the United States and any foreign jurisdictions;
                    (iv) sign all other papers necessary to carry out the above
obligations; and
                    (v) give testimony and render any other assistance, in
support of the Employer’s (or the applicable Affiliate’s) rights to any Employee
Invention.
          7.3 Disputes or Controversies. The Executive recognizes that should a
dispute or controversy arising from or relating to this Agreement be submitted
for adjudication to any court, arbitration panel, or other third party, the
preservation of the secrecy of Confidential Information may be jeopardized. All
pleadings, documents, testimony, and records relating to any such adjudication
will be maintained in secrecy and will be available for inspection by the
Employer, the Executive, and their respective attorneys and experts, who will
agree, in advance and in writing, to receive and maintain all such information
in secrecy, except as may be limited by written agreement among them.
     8. Non-Competition, Non-Solicitation and Non-Interference; Conflicts of
Interest.
          8.1 Acknowledgments By the Executive. The Executive acknowledges that:
(a) the services to be performed by him under this Agreement are of a special,
unique and

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unusual character; and (b) the Compensation provided to the Executive hereunder,
together with the consideration provided to the Executive under the Related
Agreements, constitute good and sufficient additional consideration for the
Executive’s agreements and covenants in this Section 8; and (c) the provisions
of this Section 8 are reasonable and necessary to protect the Employer’s
business.
          8.2 Covenants of the Executive. In consideration of the
acknowledgments by the Executive, and in consideration of the Compensation to be
paid or provided to the Executive by the Employer, the Executive covenants that
he will not, directly or indirectly:
               (a) during the Noncompetition Period, engage or invest in, own,
manage, operate, finance, control, or participate in the ownership, management,
operation, financing, or control of, be employed by, associated with, or in any
manner connected with, lend the Executive’s name or any similar name to, lend
Executive’s credit to or render services or advice to, any business whose
activities compete in whole or in part with the activities of the Employer, an
Affiliate or a Franchisee within those geographical areas in which the Employer,
Affiliate or Franchisee performed or performs such services (any of the
foregoing a “Competitive Business”); provided, however, that the Executive may
purchase or otherwise acquire up to (but not more than) one percent (1%) of any
class of securities of any Competitive Business (but without otherwise
participating in the activities of such Competitive Business) if such securities
are listed on any national or regional securities exchange or have been
registered under Section 12(g) of the Securities Exchange Act of 1934; or
               (b) whether for the Executive’s own account or the account of any
other person (i) at any time during the Noncompetition Period, solicit, employ,
or otherwise engage as an employee, independent contractor, or otherwise, any
Person who is or was an employee of the Employer, an Affiliate or a Franchisee
at any time during the Noncompetition Period or in any manner induce or attempt
to induce any employee of the Employer, an Affiliate or a Franchisee to
terminate his employment therewith; or (ii) at any time during the
Noncompetition Period, interfere with the business or contractual relationship
or the prospective business relationship or advantage which the Employer, an
Affiliate or any Franchisee has with any Person, including any Person who at any
time during the Noncompetition Period was an employee, contractor, supplier, or
customer of the Employer, an Affiliate or a Franchisee; or
               (c) during the Employment Period, engage in any Conflict of
Interest.
          8.3 Enforceability; Notice. If any covenant in Section 8.2 is held to
be unreasonable, arbitrary, or against public policy, such covenant will be
considered to be divisible with respect to scope, time, and geographic area, and
such lesser scope, time, or geographic area, or all of them, as a court of
competent jurisdiction may determine to be reasonable, not arbitrary, and not
against public policy, will be effective, binding, and enforceable against the
Executive. The period of time applicable to any covenant in Section 8.2 will be
extended by the duration of any violation by the Executive of such covenant. The
Executive will, while the covenant under Section 8.2 is in effect, give notice
to the Employer, within ten (10) business days after accepting any other
employment (including self-employment), of the identity of the Executive’s
employer. Employer may notify such employer that the Executive is bound by this
Agreement and, at the

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Employer’s election, furnish such employer with a copy of this Agreement or
relevant portions thereof.
     9. Equity Compensation.
          9.1 Stock Option Grant. The Executive shall receive nonqualified
options to purchase (i) 263,000 shares of the Employer’s common stock, $.01 par
value, at an exercise price equal to the market price per share on the date
hereof, and (ii) 263,000 shares of the Employer’s common stock, $.01 par value,
at an exercise price equal to $1.50 per share. Such nonqualified options shall
vest and be subject to the terms and conditions of Nonqualified Stock Option
Agreements of even date herewith. The nonqualified options granted at market
price shall be administered under the provisions of the Employer’s Omnibus
Equity Plan, except to the extent otherwise provided in the Nonqualified Stock
Option Agreement relating thereto. Future stock options may be awarded to the
Executive at the discretion of the Compensation Committee.
          9.2 Restricted Stock Grant. The Executive shall receive a restricted
stock grant of 350,000 shares of the Employer’s common stock, $.01 par value.
Such shares of restricted stock shall vest and be subject to the terms and
conditions of a Restricted Stock Agreement of even date herewith.
          9.3 Purchase of Shares. The Executive shall have the opportunity to
purchase from the Employer $100,000 of the Employer’s common stock, $.01 par
value, at a purchase price per share equal to the average closing price on the
“Pink Sheets” for the twenty (20) trading days following the public disclosure
on SEC Form 8-K of this Agreement. Such purchase is contingent on the Executive
being an “accredited investor” as defined in Regulation D promulgated under the
Securities Act of 1933, as amended, and shall be made pursuant to the
Subscription Agreement attached hereto as Exhibit B.
     10. Insurance. The Employer may, for its own benefit, maintain “keyman”
life and disability insurance policies covering the Executive. The Executive
will cooperate with the Employer and provide such information or other
assistance as the Employer may reasonably request in connection with the
Employer obtaining and maintaining such policies, including, without limitation,
consenting to any necessary medical examination or physical.
     11. General Provisions.
          11.1 Injunctive Relief; Specific Performance. The Executive
acknowledges that the injury that would be suffered by the Employer as a result
of a breach of the provisions of Section 7 or Section 8 would be irreparable and
that an award of monetary damages to the Employer for such a breach would be an
inadequate remedy. Consequently, the Employer will have the right, in addition
to any other rights it may have, to obtain injunctive relief to restrain any
breach or threatened breach of such sections or otherwise to specifically
enforce any provision thereof, and the Employer will not be obligated to post
bond or other security in seeking such relief.
          11.2 Covenants of Sections 7 and 8 are Essential and Independent. The
covenants by the Executive in Section 7 and Section 8 are essential elements of
this Agreement, and without the Executive’s agreement to comply with such
covenants, the Employer would not

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have entered into this Agreement, offered employment to the Executive or offered
the Executive the Salary and Benefits and other consideration provided
hereunder. The Executive’s covenants in Section 7 and Section 8 are independent
covenants and the existence of any claim by the Executive against the Employer
under this Agreement or otherwise, or against any Affiliate of Employer, will
not excuse the Executive’s breach of any covenant in Section 7 or Section 8. If
the Executive’s employment hereunder expires or is terminated, this Agreement
will continue in full force and effect as is necessary or appropriate to enforce
the covenants and agreements of the Executive in Section 7 and Section 8.
          11.3 Representations, Warranties and Additional Covenants of the
Executive. The Executive represents and warrants to the Employer that the
execution and delivery by the Executive of this Agreement do not, and the
performance by the Executive of the Executive’s obligations hereunder will not,
with or without the giving of notice or the passage of time, or both: (a)
violate any judgment, writ, injunction, or order of any court, arbitrator, or
governmental agency applicable to the Executive; or (b) conflict with, result in
the breach of any provisions of or the termination of, or constitute a default
under, any agreement to which the Executive is a party or by which the Executive
is or may be bound. The Executive also covenants and agrees not to use the
proprietary or confidential information (including trade secrets) of any prior
employer or Affiliate thereof or any other party in the performance of his
obligations under this Agreement.
          11.4 Waiver. The rights and remedies of the parties to this Agreement
are cumulative and not alternative. Neither the failure nor any delay by either
party in exercising any right, power, or privilege under this Agreement will
operate as a waiver of such right, power, or privilege, and no single or partial
exercise of any such right, power, or privilege will preclude any other or
further exercise of such right, power, or privilege or the exercise of any other
right, power, or privilege. To the maximum extent permitted by applicable law,
(a) no claim or right arising out of this Agreement can be discharged by one
party, in whole or in part, by a waiver or renunciation of the claim or right
unless in writing signed by the other party; (b) no waiver that may be given by
a party will be applicable except in the specific instance for which it is
given; and (c) no notice to or demand on one party will be deemed to be a waiver
of any obligation of such party or of the right of the party giving such notice
or demand to take further action without notice or demand as provided in this
Agreement.
          11.5 Binding Effect; Delegation of Executive’s Duties Prohibited. This
Agreement shall inure to the benefit of, and shall be binding upon, the parties
hereto and their respective successors, assigns, heirs, and legal
representatives; provided, however, that the duties and covenants of the
Executive under this Agreement, being personal, may not be delegated or
assigned.
          11.6 Notices. All notices, consents, waivers, and other communications
under this Agreement must be in writing and will be deemed to have been duly
given when (a) delivered by hand to the address(es) below, or (b) one business
day after deposit with a nationally recognized overnight delivery service
(receipt and next day delivery requested), in each case to the appropriate
addresses set forth below (or to such other addresses as a party may designate
by notice to the other parties):

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  If to Employer:   New Horizons Worldwide, Inc.
1900 S. State College Blvd.
Suite 200
Anaheim, CA 92806
Attention: General Counsel
 
       
 
  With a copy to:   Scott R. Wilson, Esq.
Calfee, Halter & Griswold LLP
1400 McDonald Investment Center
800 Superior Avenue
Cleveland, Ohio 44114
 
       
 
  If to Executive:   Mark A. Miller
2 Sutley Drive
Voorhees, New Jersey 08043
 
       
 
  With a copy to:   William R. Sasso, Esq.
Stradley Ronon Stevens & Young, LLP
2600 One Commerce Square
Philadelphia, PA 19103

          11.7 Entire Agreement; Amendments. This Agreement, as it may be
amended from time to time, contains the entire agreement between the parties
with respect to the subject matter hereof and supersedes all other agreements or
understandings, oral or written, between the parties hereto with respect to the
subject matter hereof. This Agreement may not be amended orally, but only by an
agreement in writing signed by the parties hereto.
          11.8 Governing Law; Venue and Jurisdiction. If a proceeding or claim
relating or pertaining to this Agreement is initiated by either party hereto,
such proceeding or claim shall and must be filed in any state or federal court
located in the State of Delaware, and such proceeding or claim shall be governed
by and construed under Delaware law, without regard to its conflict of laws
principles.
          11.9 Section Headings; Construction. The headings of Sections in this
Agreement are provided for convenience only and will not affect its construction
or interpretation. All references to “Section” or “Sections” refer to the
corresponding Section or Sections of this Agreement unless otherwise specified.
All words used in this Agreement will be construed to be of such gender or
number as the circumstances require. Unless otherwise expressly provided, the
word “including” does not limit the preceding words or terms.
          11.10 Severability. If any provision of this Agreement is held invalid
or unenforceable by any court of competent jurisdiction, the other provisions of
this Agreement will remain in full force and effect. Any provision of this
Agreement held invalid or unenforceable only in part or degree will remain in
full force and effect to the extent not held invalid or unenforceable.

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          11.11 Counterparts. This Agreement may be executed in one or more
counterparts, each of which will be deemed to be an original copy of this
Agreement and all of which, when taken together, will be deemed to constitute
one and the same agreement.
          11.12 Acknowledgement. The Executive acknowledges and confirms that he
has been represented by counsel in connection with the negotiation, execution
and delivery of this Agreement and the Related Agreements.
(Signature Page Follows)

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          IN WITNESS WHEREOF, the parties have executed and delivered this
Agreement as of the date above first written above.

            NEW HORIZONS WORLDWIDE, INC.
      /s/ Curtis Lee Smith, Jr.       By: Curtis Lee Smith, Jr.      Its:
Chairman of the Board   (“Employer”)   

                  /s/ Mark A. Miller       Mark A. Miller
      (“Executive”)     

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