Exhibit 10.14


 


NEW HORIZONS WORLDWIDE, INC.


 


RESTRICTED STOCK AGREEMENT


 


THIS RESTRICTED STOCK AGREEMENT is made on August 24, 2007, between New
Horizons Worldwide, Inc., a Delaware corporation (the “Company”) and Howard H.
Mark (the “Executive”).


 


WITNESSETH


 


WHEREAS, the Company desires to provide certain of its officers,
directors and key personnel with an equity-based incentive to maintain and
enhance the performance and profitability of the Company; and


 


WHEREAS, the Committee has determined that the Executive should be
granted restricted stock upon the terms and conditions set forth in this
Agreement.


 


NOW, THEREFORE, the Company and the Executive agree as follows:


 


1.                                       Definitions.
Capitalized terms shall have the following meanings:


 


(a)                                  “Act”
means the federal Securities Act of 1933, as amended.


 


(b)                                 “Adjusted EBITDA”
mean, with respect to any fiscal period, the sum of, without duplication, (i)
net income for that fiscal period, plus (ii) any extraordinary or
non-operating loss reflected in such net income, minus (iii) any
extraordinary or non-operating gain reflected in such net income, plus
(iv) interest expense of the Company for that fiscal period, plus (v)
the aggregate income tax expense of the Company for that fiscal period (whether
or not payable during that fiscal period), plus (vi) depreciation and
amortization expense of the Company for that fiscal period, plus (vii)
all other non-cash, extraordinary expenses of the Company for that fiscal
period, in each case as determined in accordance with generally accepted
accounting principals, consistently applied, and in the case of items (iv),
(v), (vi) and (vii), only, to the extent reflected in the determination of net
income for that fiscal period, plus (viii) to the extent deducted in
determining net income for such fiscal period, non-cash charges of the Company
during such fiscal period relating to the Company’s compliance with Financial
Accounting Standards Board Statement No. 142, plus (ix) to the extent
deducted in determining net income for such fiscal period, non-cash charges
recorded against earnings in the Company’s financial statements for such fiscal
period with respect to the write-down of leasehold estates as a result of the
sublease of such leasehold estates, plus (x) non-cash charges associated
with Options.


 


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(c)                                  “Affiliate” means any
person or entity which, at the time of reference, directly, or indirectly
through one or more intermediaries, controls, is controlled by, or is under
common control with, the Company.


 


(d)                                 “Agreement” means this
instrument, as in effect on the date of this Agreement, and as may be amended
from time to time.


 


(e)                                  “Change in Control”
shall mean 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 or Group has “Beneficial
Ownership” (within the meaning of Rule 13d3 under the Exchange Act) or 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 September 1, 2007 (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 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 the 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.


 


(f)                                    “Code” means the
Internal Revenue Code of 1986, as amended, and any successor statute.


 


(g)                                 “Committee” means the
Compensation Committee of the Board of Directors of the Company.


 


(h)                                 “Company” means New
Horizons Worldwide, Inc., a Delaware corporation, and any successor thereto.


 


(i)                                     “Disability” or “Disabled”
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.


 


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(j)                                     “Shares” means
shares of the $.01 par value common stock of the Company, or any security into
which such shares may be converted by reason of any transaction or event of the
type referred to in Section 9 hereof.


 


2.                                       Grant
of Shares. The Company shall issue to the Executive, subject to the terms
and conditions set forth in this Agreement, Sixty Thousand (60,000) Shares (the
“Grant”). In consideration of the Grant to the Executive, the Executive agrees
that the Shares shall be subject to the vesting provision set forth in Section
3 of this Agreement.


 


3.                                       Vesting
Restriction.


 


(a)                                  Except
as otherwise provided in Sections 3(a) and 3(b) below, in the event that the
Executive continues to remain employed by the Company or an Affiliate and the
Company achieves the Adjusted EBITDA targets set forth in this Section 3(a),
the Executive will be entitled to a nonforfeitable right to a portion of the
Shares in accordance with the following schedule. In the event that the
Executive ceases to be employed by the Company on or after the date hereof for
any reason prior to achieving the targets set forth below, the Executive will
forfeit any and all rights to the portion of the Shares that have not vested in
accordance with the following schedule.


 


	
  Company Adjusted EBITDA Target

  	
   

  	
  Vested Shares

  
	
  $3,357,000 in Adjusted EBITDA for the twelve (12) consecutive month
  period ending December 31, 2007

  	
   

  	
  30,000 Shares

  
	
   

  	
   

  	
   

  
	
  $7,565,000 in Adjusted EBITDA for the twelve (12) consecutive month
  period ending December 31, 2008 as may be modified by the Company’s Board of
  Directors during the budget process conducted with the Company’s management

  	
   

  	
  30,000 Shares

  



 


(b)                                 If
the Executive dies or becomes Disabled while employed by the Company prior to
achieving the targets set forth in Section 3(a), the Shares shall nevertheless
vest if such target(s) is (are) achieved during the calendar twelve (12) month
period ended during the calendar twelve (12) month period immediately following
such death or Disability.


 


(c)                                  If,
while the Executive is employed by the Company, a Change in Control occurs, all
Shares granted hereunder shall immediately vest regardless of whether such
Shares would have vested pursuant to the Schedule set forth in Section 3(a).


 


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4.                                       Escrow.
The certificate or certificates representing the Shares will remain in the
possession of the Company to be held by it in escrow until the Shares vest in
accordance with Section 3 hereof.


 


5.                                       Shareholder
Rights. During the period the Shares are held in escrow and registered in
the Executive’s name, and after execution and delivery of the Irrevocable Stock
Powers to the Company in accordance with Section 7 of this Agreement, the
Executive will be entitled to vote the Shares and to receive the dividends on
the Shares. Any common shares distributed with respect to such Shares shall be
deemed to be Shares subject to the restrictions in this Agreement.


 


6.                                       Issuance
of Shares; Restrictive Legends. The Committee may provide that one or more
Share certificates representing the Shares shall be registered in the Executive’s
name. All certificates representing Shares shall have affixed thereto legends
in substantially the following form, in addition to any other legends that may
be required under federal or state securities laws:


 


“THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN
REGISTERED PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES
ACT OF 1933, AS AMENDED (THE “ACT”), OR ANY STATE SECURITIES LAWS, AND MAY NOT
BE OFFERED, SOLD, ASSIGNED, TRANSFERRED, PLEDGED, HYPOTHECATED OR OTHERWISE
DISPOSED OF UNLESS A REGISTRATION STATEMENT UNDER THE ACT AND ANY APPLICABLE
STATE SECURITIES LAWS WITH RESPECT TO SUCH SECURITIES SHALL BE EFFECTIVE OR
UNLESS SUCH TRANSFER IS EXEMPT FROM SUCH REGISTRATION UNDER THE ACT AND SUCH
LAWS IN THE OPINION OF COUNSEL TO THE HOLDER, WHICH OPINION AND COUNSEL MUST BE
REASONABLY SATISFACTORY TO THE COMPANY.”


 


7.                                       Irrevocable
Stock Powers. To facilitate the escrow of the Shares and any reconveyance
of the Shares to the Company upon forfeiture, sale of the Shares or any other
event, the Executive has delivered to the Company the Irrevocable Stock Power
attached as Exhibit “A” hereto, with respect to the Shares, executed by the
Executive in blank as of the date of this Agreement. The Executive will execute
such additional Irrevocable Stock Powers as may be required by the Company. As
soon as practicable after the vesting of any Shares, the Company shall issue or
reissue to the Executive (or to the Executive’s designated beneficiary in the
event of the Executive’s death), one or more certificates for the Shares
represented by the Grant.


 


8.                                       Restriction
on Transfer. No Share issued pursuant to the Grant may be assigned,
transferred, otherwise encumbered or disposed of by the Executive until such
Share has vested in accordance with the schedule set forth in Section 3.


 


9.                                       Adjustment
Upon Changes in Capitalization. The number of Shares which may be purchased
pursuant to the Grant shall be appropriately adjusted as the Committee may
determine for any change after the date of the Agreement in the number of
issued Shares resulting from the subdivision or combination of Shares or other
capital adjustments, or the payment of a stock dividend, or other change in the
Shares effected without receipt of consideration by the Company; provided,
that any fractional Shares resulting from any such adjustment shall be
eliminated. Adjustments under this Section 9 shall be made by the Committee,
whose determination as to the adjustments to be made, and the extent thereof,
shall be final, binding and conclusive.


 


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10.                                 Investment
Representations.


 


The Executive represents, warrants and covenants as follows:


 


(a)                                  The
Executive is purchasing the Shares for his own account for investment only, and
not with a view to, or for sale in connection with, any distribution of the
Shares in violation of the Act, or any rule or regulation under the Act.


 


(b)                                 The
Executive has had such opportunity as he has deemed adequate to obtain from
representatives of the Company such information as is necessary to permit him
to evaluate the merits and risks of his investment in the Company.


 


(c)                                  The
Executive has sufficient experience in business, financial and investment
matters to be able to evaluate the risks involved in the issuance of the Shares
pursuant to this Agreement and to make an informed investment decision with
respect to such issuance.


 


(d)                                 The
Executive can afford a complete loss of the value of the Shares and is able to
bear the economic risk of holding such Shares for an indefinite period.


 


(e)                                  The
Executive understands that (i) the Shares have not been registered under the
Act and are “restricted securities” within the meaning or Rule 144 under the
Act, (ii) the Shares cannot be sold, transferred or otherwise disposed of
unless they are subsequently registered under the Act or an exemption from
registration is then available; (iii) in any event, the exemption from
registration under Rule 144 will not be available for at least one year and
even then will not be available unless a public market then exists for the
common shares of the Company, adequate information concerning the Company is
then available to the public, and other terms and conditions of Rule 144 are
complied with; and (iv) there is now no registration statement on file with the
Securities and Exchange Commission with respect to any of the stock of the
Company and the Company has no obligation or current intention to register the
Shares under the Act.


 


11.                                 Company
Representations. The Company represents and warrants that the issuance,
sale and delivery of the Shares, upon the terms and conditions set forth
herein, have been duly authorized by all requisite action of the Board of
Directors of the Company. When issued upon the terms and conditions of this
Agreement, the Shares will be validly issued, fully paid and nonassessable.


 


12.                                 Withholding
Taxes; Section 83(b) Election.


 


(a)                                  The
Executive acknowledges and agrees that the Company has the right to deduct from
payments of any kind otherwise due to the Executive any federal, state or local
taxes of any kind required by law to be withheld with respect to the issuance
of the Shares by the Company.


 


(b)                                 The
Executive has reviewed with the Executive’s own tax advisors the federal,
state, local and foreign tax consequences of this investment and the
transactions contemplated by this Agreement. The Executive is relying solely on
such advisors and not on any statements or representations of the Company or
any of its agents. The Executive understands that the Executive (and not the
Company) shall be responsible for the Executive’s own tax liability that may
arise as a result of this investment or the transactions contemplated by this
Agreement. The Executive understands that it may be beneficial in many
circumstances to elect to be taxed at the time the Shares are granted rather
than when and as the Shares vest pursuant to Section 2 hereof by filing an
election under Section 83(b) of the Code with the IRS within 30 days from the
date of the grant of the Shares.


 


THE EXECUTIVE ACKNOWLEDGES THAT IT IS THE EXECUTIVE’S SOLE
RESPONSIBILTY AND NOT THE COMPANY’S TO FILE TIMELY THE ELECTION UNDER SECTION
83(B).


 


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13.                                 Miscellaneous.


 


(a)                                  No
Rights to Employment. Nothing contained in this Agreement shall be
construed as giving the Executive any right to be retained, in any position, as
an employee or Director of the Company. The Executive acknowledges and agrees
that the vesting of the Shares pursuant to Section 3 hereof is earned only by
continuing service as an employee at the will of the Company (not through the
act of being hired or purchasing shares hereunder). The Executive further
acknowledges and agrees that the transactions contemplated hereunder and the
vesting schedule set forth herein do not constitute an express or implied
promise of continued engagement as an employee for the vesting period, for any
period, or at all.


 


(b)                                 Severability.
The invalidity or unenforceability of any provision of this Agreement shall not
affect the validity or enforceability of any other provision of this Agreement,
and each other provision of this Agreement shall be severable and enforceable
to the extent permitted by law.


 


(c)                                  Waiver.
Any provision for the benefit of the Company contained in this Agreement may be
waived, either generally or in any particular instance, by the Board of
Directors of the Company.


 


(d)                                 Binding
Effect. This Agreement shall be binding upon and inure to the benefit of
the Company and the Executive and their respective heirs, executors,
administrators, legal representatives, successors and assigns.


 


(e)                                  Notice.
All notices required or permitted hereunder shall be in writing and deemed
effectively given upon personal delivery or five days after deposit in the
United States Post Office, by registered or certified mail, postage prepaid,
addressed to the other party hereto at the address shown beneath his or its
respective signature to this Agreement, or at such other address or addresses
as either party shall designate to the other in accordance with this Section
13(e).


 


(f)                                    Pronouns.
Whenever the context may require, any pronouns used in this Agreement shall
include the corresponding masculine, feminine or neuter forms, and the singular
form of nouns and pronouns shall include the plural, and vice versa.


 


(g)                                 Entire
Agreement. This Agreement constitutes the entire agreement between the
parties and supersedes all prior agreements and understandings, relating to the
subject matter of this Agreement.


 


(h)                                 Amendment.
This Agreement may be amended or modified only by a written instrument executed
by both the Company and the Executive.


 


(i)                                     Governing
Law. This Agreement shall be construed, interpreted and enforced in
accordance with the laws of the State of Delaware, without regard to any
applicable conflict of laws principles, and in accordance with applicable
federal law.


 


IN WITNESS WHEREOF, the parties hereto have executed this Restricted
Stock Agreement as of the day and year first above written.


 


	
  NEW HORIZONS WORLDWIDE, INC.

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
  By:

  	
  /S/ Mark A. Miller

  	
   

  	
   

  
	
   

  	
  Mark A. Miller

  	
   

  
	
   

  	
  President and CEO

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
  EXECUTIVE:

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
  By:

  	
  /S/ Howard H. Mark

  	
   

  	
   

  
	
  Howard H. Mark

  	
   

  



 


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