Document:

Exhibit 10.1

 

EXECUTION VERSION

  

LIMITED GUARANTY AND CONTRIBUTION AGREEMENT

 

This LIMITED GUARANTY
AND CONTRIBUTION AGREEMENT (this “Agreement”) dated as of May 15, 2017, is entered into by and between (a)
FIFTH STREET HOLDINGS L.P., a Delaware limited partnership (the “Partnership”) and (b) LEONARD M.
TANNENBAUM, a limited partner of the Partnership (“Limited Guarantor”). The parties agree as follows:

 

1 
RECITALS

 

1.1 
Credit Agreement. The Partnership, as borrower, certain Subsidiaries of the Partnership that are Guarantors or become
Guarantors thereunder (such Persons, together with Borrower, collectively, the “Loan Parties” and each a “Loan
Party”), certain lenders (the “Lenders”) and Sumitomo Mitsui Banking Corporation, as administrative
agent for the Lenders (the “Agent”), are party to that certain Credit Agreement, dated as of November 4, 2014
(as amended, restated, amended and restated, supplemented or otherwise modified from time to time, the “Credit Agreement”),
pursuant to which the Lenders agreed to make Advances to the Partnership up to the Maximum Revolver Amount from time to time. Limited
Guarantor, as the majority limited partner of the Partnership, has and shall receive direct or indirect benefits from the Advances
made under the Credit Agreement.

 

1.2 
Capitalized Terms. Capitalized terms not otherwise defined in this Agreement shall have the meanings assigned to such
terms in the Credit Agreement.

 

2  required investment. 

 

2.1 
From and after the date hereof until the Termination Date (as defined below), if there shall occur an Event of Default
under the Credit Agreement and the Agent and/or the Lenders thereunder shall accelerate the Obligations in accordance with the
terms thereof (a “Credit Facility Acceleration”), Limited Guarantor hereby covenants and agrees that he shall, make
a cash contribution to, purchase common equity of, or issue subordinated indebtedness to, the Partnership in an amount equal to
the amount necessary to fulfill any shortfall in the funds and/or assets available to the Partnership and the Guarantors to repay
the outstanding Obligations under the Credit Agreement (each such investment, a “Required Investment”). The Partnership
agrees to immediately, upon receipt thereof, utilize the full amount of such Required Investment to repay the remaining Obligations
under the Credit Agreement. This is an unsecured limited guaranty of collection and Limited Guarantor shall not be deemed a Loan
Party or primary obligor under the Credit Agreement for any purposes. Limited Guarantor shall only be obligated to contribute or
loan to the Partnership the amount equal to the Required Investment after the acceleration of the Obligations and after the Partnership
and the Guarantors under the Credit Agreement have exhausted all funds and other property available to them to satisfy the Obligations,
and Limited Guarantor shall not otherwise be obligated to any other Person in any other manner with respect to the payment, repayment
or prepayment of any of the Obligations under any other circumstances.

 

2.2 
In exchange for Limited Guarantor’s obligations hereunder, the Partnership agrees to pay Limited Guarantor a reasonable
consideration in an amount to be determined by the audit committee of the board of directors of Holdings. In addition, if any Required
Investment is made by Limited Guarantor pursuant to this Agreement, the Partnership agrees to pay Limited Guarantor an additional
reasonable consideration in an amount to be determined by the audit committee of the board of directors of Holdings.

 

3 
REPRESENTATIONS AND WARRANTIES

 

Limited Guarantor represents
and warrants as follows:

 

3.1 
Residency; Legal Name, Power and Authority.

 

As of the date of this
Agreement, Limited Guarantor is a citizen and domiciliary of the United States of America, and the passport number and address
of Limited Guarantor as previously disclosed to the Partnership is true, correct and accurate. Limited Guarantor has not, in the
last five (5) years, been known by any legal name different from the one set forth on the signature page hereto. As of the date
this Agreement, the name set forth on the signature page is the true and correct name of Limited Guarantor.

 

     

     

    

The execution, delivery
and performance by Limited Guarantor of this Agreement do not (a) require any consent or approval of any governmental agency
or authority (other than any consent or approval which has been obtained and is in full force and effect), (b) conflict with
(i) any provision of any applicable laws or (ii)  any agreement, indenture, instrument or other document, or any judgment,
order or decree, which is binding upon Limited Guarantor or any of his properties or (c) require, or result in, the creation
or imposition of any Lien on any asset of Limited Guarantor. Limited Guarantor is not in default under any agreement to which he
is a party or by which he may be bound in which the default could reasonably be expected to have a material adverse effect on Limited
Guarantor.

 

3.2 
Enforceability. This Agreement constitutes, in all material respects, the legal, valid and binding obligation of Limited
Guarantor, enforceable in accordance with its terms, except as the enforceability hereof may be affected by: (a) bankruptcy, insolvency,
reorganization, moratorium, or other similar laws affecting the enforcement of creditors’ rights generally and (b) equitable
principles of general applicability.

 

3.3 
Available Funds. Limited Guarantor has provided the following documentation to the Partnership, which are true and correct
in all material respects:

 

3.3.1
 Balance sheet of Limited Guarantor as of March 31, 2017;

 

3.3.2 
Copies of brokerage statements of Limited Guarantor dated March 31, 2017 and April 30, 2017; and

 

3.3.3 
Signed representation from Limited Guarantor attesting to the Liens, if any, with respect to the assets in such brokerage
account and copies of the agreements under which such Liens were granted or created, if any.

 

4 
AFFIRMATIVE COVENANTS

 

Limited Guarantor shall
do all of the following:

 

4.1 
Change of Name, Citizenship or Residency; Government Compliance. Promptly notify the Partnership of any change in his
name (or adoption any other form of name), citizenship or domicile. Limited Guarantor shall comply with all laws, ordinances and
regulations to which it is subject, noncompliance with which could have a material adverse effect on Limited Guarantor.

 

4.2 
Further Assurances. Execute any further instruments and take further action as the Partnership reasonably requests to
effect the purposes of this Agreement.

 

4.3 
Available Funds; Financial Statements. Limited Guarantor shall at all times reserve or otherwise have sufficient cash,
Cash Equivalents and/or liquid assets to enable Limited Guarantor to perform his payment obligations under this Agreement and any
other guaranties, investment agreements, contribution agreements and other documents or instruments evidencing credit support obligations
to which he is a party. Upon the written request of the Partnership, Limited Guarantor shall deliver to the Partnership a certificate
certifying that as of the end of the then most recently ended fiscal quarter that Limited Guarantor has access to sufficient cash,
Cash Equivalents and liquid assets to perform his payment obligations under this Agreement and any other guaranties, investment
agreements, contribution agreements and other documents or instruments evidencing credit support obligations to which he is a party.

 

4.4 
Financial Statements. Within thirty (30) days after the end of each of June, September, December and March, for so long
as this Agreement is in effect, Limited Guarantor shall provide a balance sheet and copies of brokerage statements, together with
an update, if any, regarding any Liens incurred with respect to such assets in the brokerage account, in each case, in form and
substance reasonably satisfactory to the Partnership.

 

5 
EVENTS OF DEFAULT

 

If Limited Guarantor
makes any representation or warranty that fails to be true, correct and complete in any material respect, or breaches or violates
any covenant or other agreement contained herein, it shall constitute an event of default (“Limited Guaranty Default”)
hereunder.

 

    	 	-2-	 

     

    

6 
RIGHTS AND REMEDIES

 

6.1 
Rights and Remedies. After the occurrence and during the continuation of a Limited Guaranty Event of Default, the Partnership
may, without notice or demand, do any or all of the following:

 

(a)  exercise all rights and remedies with respect to Limited Guarantor that are available to the Partnership under this Agreement
or at law or equity; and

 

(b)  in the event that Limited Guarantor violates any agreement contained in Section 2.1 hereof, seek injunctive relief in a
court of competent jurisdiction as set forth in Section 8 to compel Limited Guarantor to take any such action. Limited Guarantor
hereby waives his right to oppose the Partnership’s request for such injunctive relief.

 

6.2 
No Waiver; Remedies Cumulative. The Partnership’s failure, at any time or times, to require strict performance
by Limited Guarantor of any provision of this Agreement shall not waive, affect, or diminish any right of the Partnership thereafter
to demand strict performance and compliance herewith or therewith. No waiver hereunder shall be effective unless signed by the
party granting the waiver and then is only effective for the specific instance and purpose for which it is given. The Partnership’s
rights and remedies under this Agreement are cumulative. The Partnership has all rights and remedies provided under the UCC, by
law, or in equity. The Partnership’s exercise of one right or remedy is not an election and shall not preclude the Partnership
from exercising any other remedy under this Agreement or other remedy available at law or in equity, and the Partnership’s
waiver of any Limited Guaranty Event of Default is not a continuing waiver. The Partnership’s delay in exercising any remedy
is not a waiver, election, or acquiescence.

 

6.3 
Demand Waiver. Limited Guarantor waives demand, notice of default or dishonor, notice of payment and nonpayment, notice
of any default, nonpayment at maturity, release, compromise, settlement, extension, or renewal of accounts, documents, instruments,
chattel paper, and guarantees held by the Partnership on which Limited Guarantor is liable.

 

6.4 
Obligations Absolute. Subject to Section 9.10, the obligations of Limited Guarantor hereunder are absolute and unconditional
and irrespective of any substitution, release, impairment or exchange of any guarantee of or security for any of the Obligations,
or any immaterial modification, supplementation or amendment of the Credit Agreement or any other Loan Document, or any other circumstance
whatsoever that otherwise constitutes a legal or equitable discharge or defense of a surety or guarantor (other than satisfaction
in full of all Obligations (other than contingent indemnification Obligations)). Limited Guarantor hereby waives to the fullest
extent permitted by applicable law, (i) diligence, presentment, demand of payment and protest, (ii) any request that the Partnership
be diligent or prompt in making demands hereunder and (iii) all other defenses in law or equity (other than the defense that all
Obligations (other than contingent indemnification Obligations) have been satisfied).

 

6.5 
Subrogation. Limited Guarantor shall retain and may exercise all rights of subrogation, contribution, indemnity, reimbursement
or similar rights with respect to any payments he makes under this Agreement against the Partnership, the other Loan Parties or
any other Person.

 

7 
NOTICES

 

All notices hereunder
shall be in writing (including facsimile transmission) and shall be sent to the applicable party at its address on file for such
party or at such other address as such party may, by written notice received by the other parties, have designated as its address
for such purpose. Notices sent by facsimile transmission shall be deemed to have been given when sent (if sent during customary
business hours on a Business Day and, otherwise, at opening of business on the immediately succeeding Business Day); notices sent
by mail shall be deemed to have been given three (3) Business Days after the date when sent by registered or certified mail, postage
prepaid; and notices sent by hand delivery or overnight courier service shall be deemed to have been given when received.

 

8 
CHOICE OF LAW, VENUE AND JURY TRIAL WAIVER

 

THIS AGREEMENT SHALL BE
A CONTRACT MADE UNDER AND GOVERNED BY THE INTERNAL LAWS OF THE STATE OF NEW YORK APPLICABLE TO CONTRACTS MADE AND TO BE PERFORMED
ENTIRELY WITHIN SUCH STATE, WITHOUT REGARD TO CONFLICT OF LAWS PRINCIPLES.

 

    	 	-3-	 

     

    

ANY LITIGATION BASED
HEREON, OR ARISING OUT OF, UNDER, OR IN CONNECTION WITH THIS AGREEMENT OR ANY OTHER CREDIT DOCUMENT, SHALL BE BROUGHT AND MAINTAINED
EXCLUSIVELY IN THE COURTS OF THE COUNTY OF NEW YORK OF THE STATE OF NEW YORK OR IN THE UNITED STATES DISTRICT COURT FOR THE SOUTHERN
DISTRICT OF NEW YORK. EACH PARTY HERETO HEREBY EXPRESSLY AND IRREVOCABLY SUBMITS TO THE JURISDICTION OF THE COURTS OF NEW YORK
COUNTY OF THE STATE OF NEW YORK AND OF THE UNITED STATES DISTRICT COURT FOR THE SOUTHERN DISTRICT OF NEW YORK FOR THE PURPOSE OF
ANY SUCH LITIGATION AS SET FORTH ABOVE. EACH PARTY HERETO FURTHER IRREVOCABLY CONSENTS TO THE SERVICE OF PROCESS BY REGISTERED
MAIL, POSTAGE PREPAID, OR BY PERSONAL SERVICE WITHIN OR WITHOUT THE STATE OF NEW YORK. EACH PARTY HERETO HEREBY EXPRESSLY AND IRREVOCABLY
WAIVES, TO THE FULLEST EXTENT PERMITTED BY LAW, ANY OBJECTION WHICH THEY MAY NOW OR HEREAFTER HAVE TO THE LAYING OF VENUE OF ANY
SUCH LITIGATION BROUGHT IN ANY SUCH COURT REFERRED TO ABOVE AND ANY CLAIM THAT ANY SUCH LITIGATION HAS BEEN BROUGHT IN AN INCONVENIENT
FORUM.

 

EACH PARTY HERETO HEREBY
WAIVES ANY RIGHT TO A TRIAL BY JURY IN ANY ACTION OR PROCEEDING TO ENFORCE OR DEFEND ANY RIGHTS UNDER THIS AGREEMENT AND ANY AMENDMENT,
INSTRUMENT, DOCUMENT OR AGREEMENT DELIVERED OR WHICH MAY IN THE FUTURE BE DELIVERED IN CONNECTION HEREWITH OR ARISING FROM ANY
LENDING RELATIONSHIP EXISTING IN CONNECTION WITH ANY OF THE FOREGOING, AND AGREES THAT ANY SUCH ACTION OR PROCEEDING SHALL BE TRIED
BEFORE A COURT AND NOT BEFORE A JURY.

 

This Section 8 shall
survive the termination of this Agreement.

 

9 
GENERAL PROVISIONS

 

9.1 
Successors and Assigns. This Agreement binds and is for the benefit of the successors and permitted assigns of each
party. Neither party hereto may assign this Agreement or any rights or obligations under it without the prior written consent of
the other party.

 

9.2 
Time of Essence. Time is of the essence for the performance of all obligations in this Agreement.

 

9.3 
Severability of Provisions. Each provision of this Agreement is severable from every other provision in determining
the enforceability of any provision.

 

9.4 
Counterparts. This Agreement may be executed in any number of counterparts and by different parties on separate counterparts,
each of which, when executed and delivered, is an original, and all taken together, constitute one Agreement.

 

9.5 
Survival. All covenants, representations and warranties made in this Agreement continue in full force until the Termination
Date.

 

9.6 
Captions. The headings used in this Agreement are for convenience only and shall not affect the interpretation of this
Agreement.

 

9.7 
Construction of Agreement. The parties mutually acknowledge that they and their attorneys have participated in the preparation
and negotiation of this Agreement. In cases of uncertainty this Agreement shall be construed without regard to which of the parties
caused the uncertainty to exist.

 

9.8 
Relationship. The relationship of the parties to this Agreement is determined solely by the provisions of this Agreement.
The parties do not intend to create any agency, partnership, joint venture, trust, fiduciary or other relationship with duties
or incidents different from those of parties to an arm’s-length contract.

 

9.9 
Third Parties. Nothing in this Agreement, whether express or implied, is intended to: (a) confer any benefits, rights
or remedies under or by reason of this Agreement on any persons (including any member of the Lender Group or any Lender Related
Person) other than the express parties to it and their respective permitted successors and assigns; (b) relieve or discharge the
obligation or liability of any person not an express party to this Agreement; or (c) give any person not an
express party to this Agreement any right of subrogation or action against any party to this Agreement.

 

    	 	-4-	 

     

    

 

9.10 Termination. This Agreement, and all obligations hereunder, shall terminate upon the earliest to occur of (i) August
15, 2018, (ii) the mutual agreement of the parties hereto (in the case of the Partnership, with the approval of the majority of
the independent directors of Holdings), (iii) payment in full of all Obligations (other than contingent indemnification Obligations),
(iv) any change of control of the Partnership or Holdings, including, without limitation, the acquisition of a majority of the
equity interests of the Partnership or Holdings by an unaffiliated third party and (v) any material amendment, waiver or other
modification to the Revolving Credit Facility (such date, the “Termination Date”).

 

[signature pages follow]

 

    	 	-5-	 

     

    

 

IN WITNESS WHEREOF,
the parties hereto have caused this Agreement to be duly executed and delivered by their duly authorized officers as of the date
first set forth above.

 

LIMITED GUARANTOR

 

 

 

/s/ Leonard M. Tannenbaum          

LEONARD M. TANNENBAUM

 

    	 	[Signature Page to Limited Guaranty and Contribution Agreement]
	 

     

    

 

PARTNERSHIP

 

FIFTH STREET HOLDINGS L.P.

 

By: /s/ Bernard Berman                             

Name:  Bernard Berman

Title:    President of General Partner

 

 

    	 	[Signature Page to Limited Guaranty and Contribution Agreement]EMPLOYMENT AGREEMENT

 

EXHIBIT 10.1

EMPLOYMENT AGREEMENT

THIS AGREEMENT is made as of the 13th day of May, 2017 between CREATIVE LEARNING CORPORATION ("Company") and KARLA KRETSCH ("Executive").

In consideration of the promises and the respective covenants and agreements of the parties contained herein, and intending to be legally bound hereby, the parties to this Agreement agree as follows:

1.

Employment.  The Company hereby employs the Executive and the Executive hereby accepts employment by the Company for the period and upon the terms and conditions contained in this Agreement.  This Agreement shall replace and supersede the previous employment agreement of the Executive.

2.

Term of Agreement.

The term of this Agreement will begin on the date first written above (the "Effective Date") and shall continue until July 1, 2018 unless terminated earlier in accordance with the terms of this Agreement (“Term”).  On or about June 30, 2018, the Company and the Executive shall review and evaluate renewal of this Agreement, and possible amendment of terms, including compensation. Unless terminated on or before June 30, 2018, this Agreement shall automatically renew on an annual basis thereafter. 

3.

Position and Duties.

During the Term of this Agreement, the Executive shall serve as President of the Company.  The Executive shall have such duties and responsibilities as are set forth on the Job Description attached hereto as Exhibit “A”, and such other duties as the Chairman of the Board of the Company may reasonably assign from time to time.  During the Term of this Agreement, the Executive shall devote substantially all her working time and efforts to the business and affairs of the Company and shall work in good faith to perform her duties, provided however that the Executive may engage in activities relating to personal matters (including personal financial matters) and in such corporate, industry, civic and charitable activities, so long as such service does not materially interfere with the performance of her duties hereunder or violate her obligations under Section 6 below.

4.

Compensation and Related Matters.

4.1

Compensation.  

(i)

Cash Compensation.  The Company shall pay the Executive for the term of this Agreement cash compensation amounting to the equivalent of an annual Base Salary figure of $95,000, paid in equal semi-monthly installments, and pro-rated for partial periods;

(ii)

Stock Compensation.

The Company shall also pay the Executive for the term of this Agreement stock compensation. For purposes of this section, “Average Selling 

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Price” shall mean the average closing value of the stock over the 30-day period prior to the date of the grant of stock or stock options at issue.  The stock compensation under this Agreement shall be compensation amounting to the equivalent of the following and pro-rated for partial periods: 

(a) stock grants: grants of common shares of Creative Learning Company stock issued on the last day of each quarter (e.g., June 30, 2017, September 30, 2017, December 31, 2017, March 31, 2018 and June 30, 2018), in the amount $2,500 for each quarter the Executive is employed and based upon the Average Selling Price; and 

(b) stock options: issuance of 5-year options to purchase common shares of Creative Learning Company stock issued on the last day of each quarter (e.g., June 30, 2017, September 30, 2017, December 31, 2017, March 31, 2018 and June 30, 2018), in the amount $8,750 for each quarter the Executive is employed and based upon the Average Selling Price.  

(iii)

Stock Compensation Issuance Acceleration.  In the event that the Company is taken private during the Term of this Agreement and all Company stock is redeemed, the Executive shall be entitled to acceleration of the foregoing stock compensation to occur prior to the time any such stock redemption would occur. 

(iv)

Year-end Bonus and/or Salary Possibility.  Prior to December 31, 2017, the Chairman of the Board shall evaluate the Executive’s performance from the prior year, and consider the propriety of a year-end bonus and/or salary increase considering three factors:  (1) meeting budgeted earnings; (2) meeting budgeted sales growth; and (3) enhancement of franchisee support and sales programs.  The foregoing shall also consider as a factor supporting a bonus any detrimental impact the proxy contest may have upon the Executive’s ability to achieve the three factors.  

4.2

Work Hours.

  As it is understood that Executive will be working primarily remotely from Phoenix, Arizona, the Executive shall make herself available to address Company affairs during the Company’s EST/EDT business hours. 

4.3

Vacation.  During the Term of this Agreement, the Executive shall be entitled to vacation in accordance with the Company’s current policies and practices.  To the extent that the Executive wishes to deviate from the Company’s policies and practices, the Executive shall make written request to the Chairman of the Board.

5.

Termination.

5.1

Termination by Company for Cause. The Company may terminate this Agreement for Cause.  For purposes of this Agreement, "Cause" shall mean any one of the following:

(i)

the failure by the Executive to work in good faith to perform Executive’s duties hereunder if such failure is not cured by Executive within 30 days after a written demand for cure is delivered to Executive by the Chairman of the Board.

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(ii)

the Executive willfully engaging in misconduct with regard to the Company which is materially injurious to the Company, monetarily or otherwise, including but not limited to fraud, misappropriation or embezzlement by the Executive.

(iii)

the Executive's conviction other than a minor traffic violation (or entering into a plea bargain admitting guilt or plea of nolo contendere) of any felony or any misdemeanor involving moral turpitude.

If the Executive is terminated for Cause, the Company shall pay to the Executive her Base Salary through the date of termination, and the Executive shall not be entitled to any further compensation.

5.2

Termination by Company without Cause.  The Company may terminate Executive’s employment at any time without Cause.  Should the Company terminate this Agreement without Cause, the Executive shall be paid her salary through the date of termination,  any unreimbursed expenses, and any stock grants or stock options due for the quarter in which termination occurs, and paid as scheduled at quarter-end.  Notwithstanding the foregoing, Executive shall be due compensation as fixed by operation of Section 5.3 of this Agreement if the Executive is terminated without Cause: (A) within six months of a Change in Control of the Company (as defined in Section 5.3 (iii)); or (B) the Company is taken private.

5.3

Termination by Executive for Good Reason.  The Executive may terminate this Agreement for Good Reason.  For purposes of this Agreement, "Good Reason" shall mean any one of the following:

(i)

a material breach of this Agreement by the Company (including change in Position under Paragraph 3), which is not cured by the Company after the Executive has provided 60 days written notice to cure.

(ii)

a reduction by the Company in the Executive's Base Salary as in effect on the date hereof or as the same may be increased from time to time.

(iii)

a Change in Control of the Company.  For purposes of this paragraph, Change in Control shall include: (i) any change in board members amounting to a change in the majority of seats on the Company board, including without limitation the success of the current proxy challenge by Blake Furlow; or (ii) the ascension of any individual associated with Brian Pappas to the Board of Directors of or to a position within senior management of the Company. For purposes of this paragraph, “any individual associated with Brian Pappas” shall include but not be limited to any individual whom Mr. Pappas has previously supported for a seat on the Company’s board (other than current board members) and any other individual who Executive reasonably believes may be associated with Mr. Pappas. The failure of the Executive to exercise her rights under this provision in any one instance does not waive the right of the Executive to exercise her rights under this provision in the case of future events that trigger it.  

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If the Executive terminates this Agreement with Good Reason, the Executive shall be paid an amount equivalent to her Base Salary through three months following the date of termination, any unreimbursed expenses, and any stock grants and stock options due for the quarter in which termination occurs as well as the immediately following three quarters, and paid as scheduled at quarter-end. The payment of Base Salary shall be made in equal amounts every two weeks. 

5.4

Disability.  The Company may terminate the Executive’s employment because of the Executive’s Disability.  For purposes of this Agreement, the term "Disability" shall mean the Executive’s inability to substantially perform the essential functions of her job, with or without reasonable accommodation, due to a physical or mental impairment, for a period of six consecutive months or a period of nine months in any 12 month period.

5.5

Death.  This Agreement shall terminate in the event of Executive’s death.

5.6

Termination by Executive Without Good Reason.  Should the Executive terminate this Agreement without Good Reason, the Executive shall be paid her salary through the date of termination and any unreimbursed expenses, but otherwise shall not be entitled to any further salary, bonus or other compensation or benefits.

6.

Restrictive covenants.

6.1

Non-solicitation of employees.  During the Executive’s employment with the Company and for a period of six months immediately following termination of such employment for whatever reason, the Executive shall not, directly or indirectly, solicit or attempt to induce any employee or independent contractor employed by the Company in any capacity to terminate his or her employment with the Company, or hire any such employee or independent contractor.

6.2

Definitions.  For the purposes of this section 6: the term “directly or indirectly” shall include either as an individual or as a partner, joint venturer, employee, agent, executive, independent contractor, officer, director, stockholder or otherwise.

6.3  Non-disclosure of Confidential Information.  The Executive shall not, directly or indirectly, whether while employed by the Company or afterwards, retain, disclose or use for the benefit of himself or herself or any other person, corporation, partnership, joint venture, association, or other business organization, any of the trade secrets or confidential business information of the Company (“Confidential Information”).

For purposes of this Agreement, “Confidential Information” shall mean

(i)  customer lists and prospect lists, specific information on customers and prospective customers (including information on purchasing preferences and pricing for those customers), pricing lists (including item and customer specific pricing information); proprietary purchasing and sales methods and techniques; pricing methods and strategies; computer software design and/or improvements; market feasibility studies; proposed or existing marketing techniques or plans; future company business plans; project files; design systems, information on current and potential vendors, the identity of various suppliers/vendors of products and services, and personal information about the Company’s executives, officers and directors; and

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(ii)  any information that is of value or significance to the Company that derives independent economic value, actual or potential, from not being generally know to, and not being readily ascertainable by proper means by, other persons who can obtain economic value from its disclosure or use, including information not generally known to the competitors of the Company nor intended by the Company for general dissemination.

In the event the Executive is requested or becomes legally compelled by subpoena, Court order or other legal process to disclose any Confidential Information of the Company, the Executive shall immediately provide notice to the Company so that the Company may interpose an objection and seek an appropriate protective order, and the Executive shall cooperate with the Company in its efforts to obtain such protection.

6.6

Meaning of directly or indirectly.  For purposes of this section 6, the phrase “directly or indirectly” shall include the Executive acting either as an individual on her own account or the account of another, or as a partner, joint venturer, employee, agent, independent contractor, officer, director, stockholder or otherwise.

6.7

Need for restrictions.  The Executive acknowledges and agrees that each of the restrictive covenants contained in this paragraph 6 is reasonable and necessary to protect the legitimate business interests of the Company, including without limitation the need to protect the Company’s trade secrets and confidential information and the need to protect its relationships with its customers.

6.8

Breach of restrictive covenants.  In the event of a breach by the Executive of any restrictive covenant set forth in paragraph 6, the Executive agrees that such a breach would cause irreparably injury to Company, and that if the Company shall bring legal proceedings against the Executive to enforce any restrictive covenant, the Company shall be entitled to seek all available civil remedies, at law or in equity, including without limitation an injunction, damages, attorneys fees and cost.

6.9

Construction, survival.  If any period of time, area or scope specified in this section 6 should be adjudged unreasonable in any proceeding, then the period of time or area or scope shall be reduced by elimination of such portion deemed unreasonable so that such restrictions may be enforced to the extent adjudged to be reasonable.  If the Executive violates any of the restrictions contained in this section, the restrictive period shall be extended by the period of time that such violation exists.   All the provisions of this section 6 shall survive the term of this Agreement and the Executive’s employment with the Company.

6.10

Subsidiaries and affiliates.  For purposes of this section 6, the term “Company” includes the Company’s subsidiary and affiliated entities.  All such subsidiary and affiliated entities shall be deemed third party beneficiaries of this Agreement, and shall be entitled to enforce the provisions of this section 6.

7.

Return of Company property.  All the Company’s products, customer correspondence, internal memoranda, products and designs, sales brochures, training manuals, project files, price lists, customer and vendor lists, prospectus reports, customer or vendor information, sales literature, territory printouts, call books, notebooks, textbooks e-mails and 

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Internet access, computer programs and data, and all other like information or products, including all copies, duplications, replications and derivatives of such information or products, and all laptops, pagers, beepers, keys, access cards and other similar property, acquired by the Executive while in the employ of the Company (“Company Property”), shall be the exclusive property of the Company and shall be returned to the Company promptly upon the Executive’s separation from the Company.  During the Executive’s employment with the Company, no Company Property shall be removed from the Company’s premises unless authorized by Company management and necessary for the Executive to perform her duties for the Company.

8. 

Prior Agreements.  The Executive represents to the Company (a) that there are no restrictions, agreements or understandings whatsoever to which the Executive is a party which would prevent or make unlawful the Executive’s execution of this Agreement or employment hereunder, (b) that the Executive’s execution of this Agreement and employment hereunder shall not constitute a breach of any contract, agreement or understanding, oral or written, to which the Executive is a party or by which the Executive is bound, and (c) that the Executive is free and able to execute this Agreement and to enter into employment by the Company.

9.

Miscellaneous.

9.1

Right to review and seek counsel.  The Executive hereby acknowledges that he has been provided with a copy of this Agreement for review prior to signing it, that he has been given the opportunity to have this Agreement reviewed by her own attorney prior to signing it, that he understands the purposes and effects of this Agreement, and that he has been given a signed copy of this Agreement for her records.

9.2

Waiver.  No modification or waiver of this Agreement will be valid unless the modification or waiver is in writing and signed by both of the parties.  The failure of either party at any time to insist upon the strict performance of any provision of this Agreement will not be construed as a waiver of the right to insist upon the strict performance of the same provision at any future time.

9.3

Entire agreement; amendments.  This Agreement, together with any schedules and/or exhibits attached, constitutes the entire agreement between the Executive and the Company pertaining to the subject matters of the Agreement, and supersedes all negotiations, preliminary agreements, and all prior and contemporaneous discussions and understandings of the parties hereto. Any amendments to this Agreement must be in writing and signed by both the Executive and the Company. 

9.4

Governing Law.  This Agreement shall be governed and construed in accordance with the laws of the State of Florida without regard to conflicts of law.

9.5

Severability.  If any part of this Agreement or the application of any part is held invalid by a court of competent jurisdiction, the remainder of this Agreement shall not be affected and shall be construed and enforced to the fullest extent allowed by law.

9.6

Consent to Personal Jurisdiction and Venue.  The parties hereby consent to exclusive personal jurisdiction and exclusive venue in the state and federal courts in 

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and for Phoenix, Arizona, for any action between the Company and the Executive arising out of or in connection with this Agreement or the Executive’s employment with the Company.

9.7

Headings and Captions; counterparts.  The titles and captions of sections and subsections contained in this Agreement are provided for convenience of reference only, and shall not be considered terms or conditions of this Agreement. This Agreement may be executed in counterparts, all of which shall be considered one agreement.

9.8

Successors and Assigns.  This Agreement shall be binding upon and inure to the benefit of the Company and its successors and assigns, and the Executive agrees that this Agreement may be assigned by the Company.  This Agreement is not assignable by the Executive.

9.9

Survival.  The provisions of section 6 shall survive the termination of the Executive’s employment with the Company and the termination this Agreement.

9.10

Attorney's Fees. In the event of any dispute arising out of or in connection with this Agreement, the prevailing party in any ensuing litigation shall be entitled to recover all court costs and reasonable attorneys’ fees, including attorneys’ fees on appeal, from the non-prevailing party.

9.11

Directors and Officers Insurance Policy.

The Company represents that it has in place a $5,000,000 Directors & Officers insurance policy, and that the Executive will be added to that policy as a named insured.

9.12

Waiver of Jury Trial.  In any legal action between the Executive and the Company arising out of or in connection with this Agreement, the Company and the Executive hereby expressly waive trial by jury.

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

			
	 
	CREATIVE LEARNING CORPORATION

	 
	 
	 

	 
	By:

	/s/ Charles Grant

	 
	 
	Charles Grant

	 
	Its:

	Chairman of the Board

	 
	 
	 

	 
	5/13/17

	 
	 
	Date

	 
	 
	 

	 
	/s/ Karla Kretsch

	 
	KARLA KRETSCH

	 
	 
	 

	 
	5/13/17

	 
	 
	Date

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EXHIBIT A

As President, the Executive shall be responsible for duties and responsibilities including without limitation oversight and execution of the following:

1.

Oversee and supervise all daily operations of the Company excluding the responsibilities exclusively assigned to the Chief Financial Officer;

2.

Franchise sales domestically and internationally;

3.

Strategic Planning with corporate board; 

4.

Supervision and improvement of franchisee operations including profitability and educational offerings;

5.

Curriculum development and implementation;

6.

Marketing;

7.

Technology, including internal IT and franchise management capabilities.

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