Document:

Exhibit 10.1

 

CONSULTING,
MANAGEMENT AND LICENSE AGREEMENT 

 

BY
AND AMONG

 

SOCCER
PARTNERS AMERICA, a Colorado not for profit corporation, 

 

ALTITUDE
INTERNATIONAL HOLDINGS, INC., a New York corporation

 

AND

 

CMA
SOCCER LLC, a Florida limited liability company

 

    	 

     

    

 

THIS
CONSULTING, MANAGEMENT AND LICENSE AGREEMENT (the “Agreement”) is made and executed as of this 7th day of March, 2022,
by and among Soccer Partners America, a Colorado not for profit corporation, located at 9665 N Roxborough Park Rd., Littleton CO 80125
(hereinafter referred to as “Rush”), Altitude International Holdings, Inc., a New York corporation (hereinafter referred
to as “Altitude”), and CMA Soccer LLC, a Florida limited liability company, 4500 SE Pine Valley Street, Port St. Lucie,
Florida 34952 (hereinafter referred to as “CMAS”).

 

WHEREAS,
CMAS operates residential and non-residential academies for elite youth soccer athletes at Club Med Sandpiper Bay in Port St. Lucie,
Florida;

 

WHEREAS,
RUSH has developed the largest known network of affiliated independent youth soccer clubs and desires to augment its player development
system with the establishment of a RUSH residential academy program and a men’s professional team;

 

WHEREAS,
Altitude and CMAS desire to complement the Rush Mission and Purpose (attached as Schedule A hereto.

 

WHEREAS,
RUSH is the exclusive owner of the RUSH Identification, as defined below, and the exclusive owner of the RUSH Programs, as defined
below;

 

WHEREAS,
the Parties desire to raise and set aside $3mm. $2.7mm of the $3mm will be for the purpose of funding the establishment of a men’s
professional soccer team and with the remaining balance of $300k for the operation of the RUSH Programs;

 

WHEREAS,
RUSH desires to enter into an agreement with CMAS for CMAS to exclusively operate the RUSH Programs on a worldwide basis under the
name “Rush” or a name to be determined by the parties;

 

    	2

     

    

 

WHEREAS,
Altitude seeks to hire Tim Schulz, current president and CEO of Rush, as an officer of CMAS and charge him with directing CMAS’s
operation of the RUSH Programs and with establishing and managing a men’s professional soccer team.

 

NOW
THEREFORE, RUSH and CMAS agree as follows:

 

	1.	DEFINITIONS.
                                            As used herein, the following terms shall be defined as set forth below:

 

		(a)	“RUSH
                                            Identification” shall mean the name “Rush” and any signature, image,
                                            words, symbols, or photographic representations or combinations thereof which identify Rush.

 

		(b)	“RUSH
                                            Material” shall mean RUSH proprietary training methodology, documentation and materials.

 

		(c)	“RUSH
                                            Technologies” shall mean RUSH proprietary technologies and platforms.

 

		(d)	“New
                                            Logo” shall mean a logo of RUSH to be created by the parties to be used in connection
                                            with the operations of CMAS hereunder.

 

		(e)	“Academies”
                                            shall mean “Club Med Soccer Academies” at CMAS locations around the world.

 

		(f)	“RUSH
                                            Programs” shall mean all of RUSH’s current soccer programs, teams, affiliated
                                            teams and activities, including, but not limited to, RUSH’s club programs (U6-U19 boys
                                            and girls teams) administered, delivered and priced under a local and/or national club format,
                                            and all memberships related thereto, as further developed by the parties hereunder. Locations
                                            include current operations throughout the world and other locations programs determined by
                                            the parties.

 

		(g)	“RUSH
                                            Database” shall mean the database of RUSH’s active Program members (currently
                                            approximately 67 clubs), RUSH’s total data base (currently approximately 45,000 players).
                                            And all of RUSH’s owned or licensed soccer related databases.

 

    	3

     

    

 

		(h)	“RUSH
                                            Revenues” shall mean all revenues related to the RUSH Programs, generated from
                                            club team fees, membership fees tournament entry fees and all other revenues associated with
                                            any RUSH Program or related activity and the RUSH Technologies, as well as any new revenue
                                            streams directly or indirectly related thereto including but not limited to player management
                                            and buying and selling rights to players.

 

		(i)	“RUSH
                                            Costs” shall mean all costs associated with the operation of the RUSH Programs
                                            hereunder.

 

		(j)	“RUSH
                                            Board” shall mean the Board of Directors of Rush.

 

		(k)	“Capelli
                                            Agreement” shall mean the agreement between RUSH and Capelli Sport attached as
                                            Exhibit A hereto.

 

		(l)	“CMAS
                                            Academy Customers” shall mean full time boarding and non-boarding academy customers,
                                            Weekly boarding and non-boarding Academy Customers, Academy Pre-season soccer team customers.

 

	2.	TERM

 

The
initial term of this Agreement (the “Initial Term”) shall commence on March 5, 2022 and shall continue for a period
of ten (10) years. The Initial Term of this Agreement shall automatically extend for two (2) additional consecutive five (5) year periods
(each a “Renewal Term”) unless CMAS provides written notice of its intent not to enter into the upcoming Renewal Term
(3) months prior to the conclusion of the then current Initial Term or Renewal Term. The Initial Term and the Renewal Terms, if any,
are hereinafter referred to as the “Term”.

 

	3.	TERMINATION

 

In
addition to any other termination rights set forth in this Agreement:

 

		(a)	CMAS
                                            shall have the right to terminate this Agreement upon written notice to RUSH at any time
                                            in the event the license and management agreement between CMAS and Club Med (the “CMAS
                                            Club Med Agreement”) is terminated provided such termination right is exercised
                                            within 90 days following such termination. .

 

    	4

     

    

 

		(b)	RUSH
                                            shall have the right to terminate this Agreement upon: a) written notice to CMAS in the event
                                            that Schulz’s employment agreement is terminated by Altitude without Cause (as defined
                                            in Schulz’s employment agreement) (provided such termination right is exercised within
                                            90 days following such termination); b), CMAS fails to raise or obtain $2.7 million of funding
                                            for the Pro Team by the third anniversary hereof (the “Funding Failure”)
                                            (provided such termination right is exercised within 90 days following the third anniversary
                                            hereof); or, c) the license and management agreement between CMAS and Club Med (the “CMAS
                                            Club Med Agreement”) is terminated provided such termination right is exercised
                                            within 90 days following such termination unless CMAS has secured an alternate location or
                                            accommodation mutually agreed upon by the parties.

 

	4.	CMAS
                                            OBLIGATIONS. Subject to the terms and conditions of this Agreement, CMAS agrees to perform
                                            the following consulting, managerial and operational services for RUSH. It is understood
                                            that CMAS is not guaranteeing any particular results:

 

		(a)	CMAS
                                            shall administer and deliver the RUSH Programs and shall retain the RUSH Revenues for its
                                            own account. RUSH shall transfer any cash on hand as of the Effective Date to CMAS to the
                                            extent required to pay any outstanding liabilities as of the Effective Date related to the
                                            RUSH Programs. Without limiting the generality of the foregoing, RUSH will enter into the
                                            Consent to Assignment attached as Exhibit B hereto which consents to the assignment of the
                                            Capelli Agreement to CMAS , which agreement RUSH represents is in full force and effect as
                                            of the Effective Date. RUSH further represents that neither party to the Capelli Agreement
                                            is, or with the passage of time will be, in default or material breach thereunder, that the
                                            transactions contemplated hereby will not cause a breach or default thereunder and that RUSH
                                            has obtained all necessary consents under the Capelli Agreement.

 

    	5

     

    

 

		(b)	CMAS
                                            and RUSH shall prepare the annual Budget for the RUSH Programs setting forth programming
                                            guidelines, sales, marketing and promotional support requirements, facility requirements,
                                            projected capital expenditures, market analysis, financial projections, staffing requirements
                                            and training. The Budget for any fiscal year during the Term commencing on January 1rst and
                                            ending December 31rst shall be finalized on or before December 31rst for the following fiscal
                                            year. It is understood that the Budget (or any part thereof) shall not be construed to contain
                                            any representations, warranties, or guarantees of either party. If the parties cannot agree
                                            upon an annual Budget for any year in a timely fashion while the parties resolve any disputed
                                            issues with respect to such annual Budget, CMAS shall operate in accordance with the annual
                                            Budget for the year just ended. Notwithstanding the foregoing, CMAS may adjust the Budget
                                            if any projections or line items are not appearing to be realized or if any revenue-generating
                                            relationship is compromised or terminated. The initial Budget for the first fiscal year is
                                            attached as Annex 1 hereto.

 

		(c)	CMAS
                                            will select the personnel necessary to manage the RUSH Programs. Such personnel will be employed
                                            by CMAS. The CMAS personnel for the RUSH Program shall be under the direction, control and
                                            supervision of Schulz (while an employee in good standing of CMAS) in consultation with CMAS
                                            senior management. CMAS senior management and Schulz (while an employee in good standing
                                            of CMAS) shall consult regarding the hiring, continuing employment and termination of all
                                            CMAS personnel hired to operate the RUSH Programs. CMAS is responsible for paying all salaries,
                                            fringe benefits, employment taxes and other amounts relating to the CMAS personnel including,
                                            without limitation, all applicable tax reporting and withholding taxes. CMAS intends to initially
                                            hire the staff of RUSH who currently operate RUSH’s soccer programs.

 

		(d)	CMAS
                                            shall keep full and complete books of account and such other records reflecting the operations
                                            of the RUSH Programs showing accurately and completely all RUSH Revenues and RUSH Costs.
                                            CMAS shall preserve all such books and records for at least three (3) years from the close
                                            of CMAS’s fiscal year to which they relate. Such books and records shall be kept in
                                            accordance with modern and generally accepted practices for bookkeeping and accounting. The
                                            books and records shall be kept at CMAS’s office. RUSH shall be allowed to inspect
                                            CMAS’s books and records pertaining to the RUSH Programs during normal business hours
                                            upon five business days’ prior written notice to CMAS.

 

    	6

     

    

 

		(e)	CMAS
                                            shall hold regular quarterly meetings with RUSH virtually or at a mutually acceptable location
                                            to review the operations of the RUSH Program. CMAS shall prepare and provide monthly and
                                            year to date profit and loss and cash flow reports of the results of its operations regarding
                                            the RUSH Program at such meeting.

 

		(f)	CMAS
                                            shall prepare annual unaudited reports of the results of operations of the RUSH Programs,
                                            which shall include, without limitation, a statement of the RUSH Revenues and RUSH Costs.

 

		(g)	CMAS
                                            shall make day to day functional operation and management decisions regarding the RUSH Programs,
                                            including, without limitation, management, marketing, merchandising, accounting, and programming.

 

		(h)	CMAS
                                            shall be responsible for the development and implementation of the RUSH Programs and all
                                            related activities and further development of the RUSH Technologies.

 

		(i)	All
                                            training materials, intellectual property and other work product developed by CMAS for the
                                            RUSH Programs and coaches training/certification for the RUSH Programs shall be the sole
                                            and exclusive property of CMAS such that RUSH shall not have any claims in or ownership or
                                            other interest in any of the foregoing.

 

		(j)	CMAS
                                            shall have the right to solicit RUSH Program participants/candidates to CMAS for boarding
                                            and non-boarding semester and weekly programs in connection with all RUSH Programs and activities,
                                            with all revenues resulting therefrom to be solely for the account of CMAS.

 

    	7

     

    

 

	5.	BUDGET;
                                            COLLECTIONS ; RUSH PROGRAM COSTS

 

		(a)	CMAS
                                            and RUSH shall prepare a budget (the “Budget”) for each fiscal year in
                                            accordance with Section 3b of this Agreement, which Budget shall include projections of the
                                            RUSH Revenues and RUSH Costs.

 

		(b)	The
                                            Budget will include amounts to cover the reasonable out of the pocket expenses for CMAS’s
                                            staff to travel to and from and operate the locations where RUSH Programs occur, except in
                                            the case where third parties will be reimbursing them for such expenses. All such expenses
                                            will be pre-approved by CMAS via an expense report estimate form.

 

		(c)	CMAS
                                            shall collect all RUSH Revenues, which shall all be for the sole account of CMAS. All RUSH
                                            Costs shall be paid out of and accounted for through CMAS’s books and accounts. CMAS
                                            shall keep detailed records of all bills and invoices for services, work and supplies contracted
                                            for in connection with the operation of the RUSH Programs in accordance with this Agreement,
                                            and shall be responsible for paying all such bills and invoices, unless such bills are contested
                                            in good faith.

 

	6.	PROMOTIONAL
                                            RIGHTS.

 

		(a)	RUSH
                                            hereby grants CMAS the right to access and use the RUSH Database worldwide in connection
                                            with the advertisement, promotion, operation and conduct of CMAS and all CMAS facilities
                                            (or at CMAS’ request RUSH will distribute materials provided by CMAS to the RUSH Database).
                                            Such access and use shall be exclusive to CMAS and shall be in compliance with applicable
                                            law.

 

		(b)	RUSH
                                            expressly agrees that no third party will be granted the right to have access to and use
                                            the RUSH Database.

 

    	8

     

    

 

		(c)	The
                                            parties acknowledge that CMAS may develop and elect to use, promote and operate CMAS under
                                            “Altitude Rush Academy” provided, however, that in no event shall the name “Rush”
                                            be utilized in connection with any other name hereunder without the express prior written
                                            consent of the RUSH Board (such consent not to be unreasonably withheld) Any and all such
                                            names (including “Club Med Soccer Academies”) used by CMAS in conjunction with
                                            the RUSH Identification, including but not limited to the New Logo, shall be the sole and
                                            exclusive property of CMAS.. Likewise, any artwork product or other intellectual property
                                            developed under, within or around these names, and all associated operations therewith will
                                            exclusively belong to CMAS.

 

		(d)	It
                                            is understood that CMAS’s academy businesses are the sole and exclusive property of
                                            CMAS.

 

	7.	INSURANCE.
                                            CMAS agrees to provide and maintain, throughout the Term of this Agreement, at CMAS’s
                                            expense, comprehensive and adequate general liability insurance for the RUSH Programs at
                                            reasonable levels. RUSH shall be named as an additional insured on such policies and shall
                                            be provided with a certificate evidencing the same. The insurance required to be maintained
                                            hereunder shall provide that the insurer may not terminate or materially modify such policy
                                            without prior written notice to RUSH at least thirty (30) days in advance thereof.

 

	8.	EXCLUSIVE
                                            LICENSE

 

		(a)	RUSH
                                            grants to CMAS the exclusive worldwide right to use the RUSH Name, the New Logo, the RUSH
                                            Materials and the RUSH Technologies in connection with the operation, marketing and exploitation
                                            of CMAS’s full time, school semester, school year and short time weekly, junior, adult,
                                            professional and family, boarding and non-boarding soccer programs. RUSH will, at no cost
                                            to CMAS, provide support for the RUSH Materials and the RUSH Technologies; provided however
                                            that CMAS will pay for the continuing development of the RUSH Technologies to the extent
                                            CMAS believes such development to be necessary or helpful for exploiting the RUSH Programs.

 

		(b)	RUSH
                                            further agrees that it will not, at any time during the Term and for a period of two (2)
                                            years after the expiration of this Agreement, solicit or induce any CMAS and/or RUSH CMAS
                                            Academy Customers or CMAS affiliates or partners involved directly or indirectly in CMAS
                                            or the RUSH CMAS Academy customers to terminate their relationship or decrease the level
                                            of business transacted with CMAS or the RUSH CMAS Academy customers at CMAS

 

    	9

     

    

 

		(c)	In
                                            the event any covenant herein shall be determined by any court of competent jurisdiction
                                            to be unenforceable by reason of its extending for too great a period of time or over too
                                            great a geographical area or by reason of its being too extensive in any other respect, it
                                            shall be interpreted to extend only over the maximum period of time for which it may be enforceable,
                                            and/or over the maximum geographical area as to which it may be enforceable and/or to the
                                            maximum extent in all other respects as to which it may be enforceable, all as determined
                                            by such court in such action.

 

		(d)	RUSH
                                            acknowledges and agrees that a breach of the covenants contained herein will cause irreparable
                                            damage to CMAS, the exact amount of which will be difficult to ascertain, and that the remedies
                                            at law for any such breach will be inadequate. Accordingly, RUSH agrees and acknowledges
                                            a breach of the covenants contained herein, in addition to any other remedy which may be
                                            available at law or in equity, CMAS shall be entitled to specific performance and injunctive
                                            relief, without posting bond or other security or showing actual damages.

 

	9.	SERVICE
                                            FEES. CMAS shall generate and retain the RUSH Revenues for its sole account and benefit.
                                            The parties agree that the opportunity for CMAS to generate and retain the RUSH Revenues
                                            is in consideration of the performance by CMAS of all the services and obligations under
                                            this Agreement.

 

	10.	LICENSE
                                            FEES, SCHEDULES OF PAYMENTS

 

Subject
to the terms and conditions of this Agreement and in consideration of the license and other rights granted to CMAS thereby, CMAS agrees
to pay to RUSH a fixed fee of $20,000.00 annually, for a total fee of $400,000.00 over the full Term (if such Term and all the
Renewals are not earlier terminated as provided herein), payable in $1,666.67 equal installments of , each on or before the first day
of each month during the Term, prorated for partial months (s).

 

    	10

     

    

 

	11.	DEFAULT.
                                            If either party at any time during the term hereof shall (a) fail to make any payment
                                            of a sum of money herein specified to be made, or (b) fail to observe or perform any of the
                                            covenants, agreements or obligations hereunder (other than the payment of money), the non-defaulting
                                            party may terminate this Agreement as follows: as to (a) if such payment is not made within
                                            ten (10) days after the defaulting party shall have received written notice of such failure
                                            to make payment, or as to (b) if such default is not cured within thirty (30) days after
                                            the defaulting party shall have received written notice specifying in reasonable detail the
                                            nature of such default. In order to be a sufficient notice hereunder, any such written notice
                                            shall specify in reasonable detail each item of default and shall specify the provision of
                                            this Agreement which applies to each item of default, and shall specify in reasonable detail
                                            the action the defaulting party is required to take in order to cure each item of default.
                                            The termination rights set forth in this Clause 9 shall not constitute the exclusive remedy
                                            on the non-defaulting party hereunder, however, and if default is made by either party hereunder,
                                            the other may resort to such other remedies as are available to such non-defaulting party
                                            at law or in equity, including, without limitation, seeking injunctive relief if warranted.
                                            Either party shall have the right to terminate this Agreement for cause (as hereinafter defined)
                                            upon thirty (30) days’ written notice to the other, which notice shall specify in reasonable
                                            detail the reasons underlying such termination. For the purpose of this Agreement “cause”
                                            shall mean (a) the willful and continued failure by the defaulting party to perform its duties
                                            hereunder, provided the non-defaulting party has timely performed all of its obligations
                                            hereunder, or, (b) the engagement by the defaulting party in willful misconduct or gross
                                            negligence which is materially injurious to the non-defaulting party. Termination of this
                                            Agreement under the provisions of this Clause 11 shall be without prejudice and any rights
                                            or claims which the terminating party may otherwise have against the defaulting party.

 

    	11

     

    

 

	12.	ESTABLISHMENT
                                            OF A MEN’S PROFESSIONAL SOCCER TEAM

 

The
parties agree to work together to establish a RUSH-branded men’s professional soccer team (the “Pro Team”). Such team
shall be owned by a wholly owned subsidiary of CMAS and shall be managed, for the duration of the Term, by Schulz (only while Schulz
is an employee in good standing of Altitude). The parties will mutually agree on any additional partners or investors deemed to be necessary
by the parties for the purpose of establishing the Pro Team. In the event of a Funding Failure, RUSH may, if it chooses not to terminate
this Agreement as provided herein, choose to work with a third party on a Pro Team while otherwise continuing under this Agreement.

 

	13.	USE
                                            OF THE RUSH IDENTIFICATION AFTER TERMINATION. Notwithstanding anything to the contrary
                                            contained herein, and except as otherwise expressly provided, from and after the termination
                                            of this Agreement for any reason, all of the rights of CMAS to the use of the RUSH Identification
                                            shall cease after a reasonable wind down period and CMAS shall not thereafter use or refer
                                            to the RUSH Identification or the name RUSH in advertising or promotion or in any other manner
                                            whatsoever. Notwithstanding the foregoing, upon a termination by RUSH due to a Funding Failure,
                                            CMAS may use the RUSH Identification for a period of 180 days thereafter while transitioning
                                            away from the use of the RUSH Identification.

 

	14.	INSTRUCTIONAL
                                            EQUIPMENT AND SUPPLIES.

 

		(a)	RUSH
                                            shall provide CMAS with access to any preferred vendor relationship for designated soccer
                                            equipment, training tools and soccer apparel for the CMAS staff uniform and personal equipment
                                            usage.

 

	15.	INDEPENDENT
                                            CONTRACTOR. RUSH and CMAS acknowledge and agree that CMAS is an independent contractor
                                            and is not an employee, partner or co-venture of RUSH, and CMAS is being engaged only for
                                            the purposes and to the extent set forth in this Agreement. Except as set forth in this Agreement,
                                            neither CMAS nor any of its employees shall be considered as having an employee or agent
                                            status with RUSH unless written approval is obtained from CMAS, and neither CMAS nor any
                                            of its employees shall be entitled to participate in any plans, arrangements or distributions
                                            of RUSH by virtue of the provisions of this Agreement. RUSH and CMAS agree that during the
                                            Term of this Agreement, each will be responsible for the withholding and payment of any and
                                            all local, state federal, FICA, FUTA, SUTA, unemployment or other taxes from its employees
                                            only.

 

    	12

     

    

 

	16.	ENTIRE
                                            AGREEMENT. This instrument constitutes the entire Agreement between the parties and cannot
                                            be modified except by a written instrument signed by all the parties hereto.

 

	17.	FORCE
                                            MAJEURE 

 

		(a)	No
                                            party shall be liable or responsible to the other party, or be deemed to have defaulted under
                                            or breached this Agreement, for any failure or delay in fulfilling or performing any term
                                            of this Agreement (except for any obligations to make payments to the other party hereunder),
                                            when and to the extent such failure or delay is caused by or results from acts beyond the
                                            impacted party’s (“Impacted Party”) reasonable control, including,
                                            without limitation, the following force majeure events (“Force Majeure Event(s)”):
                                            (a) acts of God; (b) flood, fire, earthquake, or explosion; (c) war, invasion, hostilities
                                            (whether war is declared or not), terrorist threats or acts, riot or other civil unrest;
                                            (d) government order, law, or actions; (e) embargoes or blockades in effect on or after the
                                            date of this Agreement; and (f) telecommunication breakdowns, power outages or shortages,
                                            lack of warehouse or storage space, inadequate transportation services, or inability or delay
                                            in obtaining supplies of adequate or suitable materials; and (g) other similar events beyond
                                            the reasonable control of the Impacted Party.

 

		(b)	The
                                            Impacted Party shall give notice within three (3) days of the Force Majeure Event to the
                                            other party, stating the period of time the occurrence is expected to continue. The Impacted
                                            Party shall use diligent efforts to end the failure or delay and ensure the effects of such
                                            Force Majeure Event are minimized. The Impacted Party shall resume the performance of its
                                            obligations as soon as reasonably practicable after the removal of the cause. In the event
                                            that the Impacted Party’s failure or delay remains uncured for a period of ten (10)
                                            consecutive days following written notice given by it under this Section 15, the other party
                                            may thereafter terminate this Agreement upon five (5) days’ written notice.

 

	18.	ASSIGNMENT

 

CMAS
and Altitude may not assign this Agreement to a third party without RUSH’s prior written approval, which approval may not be unreasonably
withheld or delayed.

 

	19.	GOVERNING
                                            LAW; PREVAILING PARTY.

 

		(a)	This
                                            Agreement shall be governed by the laws of the state of Florida.

 

		(b)	If
                                            any legal action is ever instituted by either party hereto to enforce, or to seek damages
                                            for the breach of any provisions hereof, the prevailing party in such legal action shall
                                            be promptly reimbursed by the other party for all costs reasonably incurred by the prevailing
                                            party in connection with such legal action, including all fees of professionals (such as
                                            attorneys, accountants, appraisers, and engineers), fees of expert witnesses, travel expenses,
                                            duplicating expenses, courier expenses, and telephone and telefax charges.

 

[Signature
Page to Follow]

 

    	13

     

    

 

 

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

 

	Soccer Partners America.	 	CMA Soccer LLC
	 	 	 
	By:	/s/
    Tim Schulz	 	By:	/s/
    Greg Breunich
	Name:	Tim Schulz	 	Date:	March 7, 2022
	Title:	President & Chief Executive Officer	 	 
	Date:	March 5, 2022	 	 
	 	 	 
	Altitude International Holdings, Inc.	 	 
	 	 	 
	By:	/s/ Greg
    Breunich	 	 
	Name:	Greg Breunich	 	 
	Title:	Chief Executive Officer	 	 
	Date:	March 7, 2022	 	 

 

    	14

     

    

 

Schedule
A

 

 

 

    	15EXHIBIT A

​

Exhibit 10.17
UNSECURED REVOLVING
DEMAND PROMISSORY NOTE
$30,000,000.00‌December 31, 2021
​
​
Section 1.  Promise to Pay.  For and in consideration of value received, the undersigned, Valhi, Inc., a corporation duly organized under the laws of the state of Delaware (“Borrower”), promises to pay, in lawful money of the United States of America, to the order of Kronos Worldwide, Inc., a corporation duly organized under the laws of the state of Delaware (“Kronos Worldwide”), or the holder hereof (as applicable, Kronos Worldwide or such holder shall be referred to as the “Noteholder”), the principal sum of THIRTY MILLION and NO/100ths United States Dollars ($30,000,000.00) or such lesser amount as shall equal the unpaid principal amount of the loan made by the Noteholder to Borrower together with accrued and unpaid interest on the unpaid principal balance from time to time pursuant to the terms of this Unsecured Revolving Demand Promissory Note, as it may be amended from time to time (this “Note”).  This Note shall be unsecured and will bear interest on the terms set forth in Section 7 below. Capitalized terms not otherwise defined shall have the meanings given to such terms in Section 19 of this Note.
​
Section 2.2.  Amendment and Restatement.  This Note renews, replaces, amends and restates in its entirety the Unsecured Revolving Demand Promissory Note dated December 31, 2020 in the original principal amount of $40,000,000.00 payable to the order of the Noteholder and executed by the Borrower (the “Prior Note”).  As of the close of business on December 31, 2021, the unpaid principal balance of the Prior Note was nil, the accrued and unpaid interest thereon was nil and the accrued and unpaid commitment fee thereon was nil, which is the unpaid principal, accrued and unpaid interest and accrued and unpaid commitment fee owed under this Note as of the close of business on the date of this Note.  This Note contains the entire understanding between the Noteholder and the Borrower with respect to the transactions contemplated hereby and supersedes all other instruments, agreements and understandings between the Noteholder and the Borrower with respect to the subject matter of this Note.
​
Section 3.2.  Place of Payment.  All payments will be made at Noteholder’s address at Three Lincoln Centre, 5430 LBJ Freeway, Suite 1700, Dallas, Texas 75240-2620, Attention:  Treasurer, or such other place as the Noteholder may from time to time appoint in writing.
​
Section 4.3.  Payments.  The unpaid principal balance of this Note and any accrued and unpaid interest thereon shall be due and payable on the Final Payment Date.  Prior to the Final Payment Date, any accrued and unpaid interest on an unpaid principal balance shall be paid in arrears quarterly on the last day of each March, June, September and December, commencing March 31, 2022.  All payments on this Note shall be applied first to accrued and unpaid interest, next to accrued interest not yet payable and then to principal.  If any payment of principal or interest on this Note shall become due on a day that is not a Business Day, such payment shall be made on the next succeeding Business Day and the payment shall be the amount owed on the original payment date.
​
Section 5.3.  Prepayments.  This Note may be prepaid in part or in full at any time without penalty.
​
Section 6.3.  Borrowings.  Prior to the Final Payment Date, Noteholder expressly authorizes Borrower to borrow, repay and re-borrow principal under this Note in increments of $100,000 on a daily basis so long as:
​
		●	the aggregate outstanding principal balance does not exceed $30,000,000.00; and

		●	no Event of Default has occurred and is continuing.

​
Notwithstanding anything else in this Note, in no event will Noteholder be required to lend money to Borrower under this Note and loans under this Note shall be at the sole and absolute discretion of Noteholder.
​
Section 7.5.  Interest.  The unpaid principal balance of this Note shall bear interest at the rate per annum of the Prime Rate plus one percent (1.00%).  In the event that an Event of Default occurs and is continuing, the unpaid principal amount shall bear interest from the Event of Default at the rate per annum of the Prime Rate plus four percent (4.00%) until such time as the Event of Default is cured.  Accrued interest on the unpaid principal of this Note shall be computed on the basis of a 365- or 366-day year for actual days (including the first, but excluding the last day) elapsed, but in no event shall such computation result in an amount of accrued interest that would exceed accrued interest on the unpaid principal balance during the same period at the Maximum Rate. Notwithstanding anything to the contrary, this Note is expressly limited so that in no contingency or event whatsoever shall the amount paid or agreed to be paid to the Noteholder exceed the Maximum Rate.  If, from any circumstances whatsoever, the Noteholder shall ever receive as interest an amount that would exceed the Maximum Rate, such amount that would be excessive 

​

​

interest shall be applied to the reduction of the unpaid principal balance and not to the payment of interest, and if the principal amount of this Note is paid in full, any remaining excess shall be paid to Borrower, and in such event, the Noteholder shall not be subject to any penalties provided by any laws for contracting for, charging, taking, reserving or receiving interest in excess of the highest lawful rate permissible under applicable law.  All sums paid or agreed to be paid to Noteholder for the use, forbearance or detention of the indebtedness of the Borrower to Noteholder shall, to the extent permitted by applicable law, be amortized, prorated, allocated and spread throughout the full term of such indebtedness until payment in full of the principal (including the period of any renewal or extension thereof) so that the interest on account of such indebtedness shall not exceed the Maximum Rate.  If at any time the Contract Rate is limited to the Maximum Rate, any subsequent reductions in the Contract Rate shall not reduce the rate of interest on this Note below the Maximum Rate until the total amount of interest accrued equals the amount of interest that would have accrued if the Contract Rate had not been limited by the Maximum Rate.  In the event that, upon the Final Payment Date, the total amount of interest paid or accrued on this Note is less than the amount of interest that would have accrued if the Contract Rate had not been limited by the Maximum Rate, then at such time, to the extent permitted by law, in addition to the principal and any other amounts Borrower owes to the Noteholder, the Borrower shall pay to the Noteholder an amount equal to the difference between:  (i) the lesser of the amount of interest that would have accrued if the Contract Rate had not been limited by the Maximum Rate or the amount of interest that would have accrued if the Maximum Rate had at all times been in effect; and (ii) the amount of interest actually paid on this Note.
​
Section 8.5.  Fees and Expenses. On the last day of each March, June, September and December, commencing March 31, 2022, and on the Final Payment Date, Borrower shall pay to Noteholder the Unused Commitment Fee for such period, provided, however, Borrower will not owe any Unused Commitment Fee for any part of such period (prorated as applicable) that the Noteholder is a net borrower of money from the Borrower.  In addition, Borrower and any guarantor jointly and severally agree to pay on the Final Payment Date to Noteholder any other cost or expense reasonably incurred by Noteholder in connection with Noteholder’s commitment to Borrower pursuant to the terms of this Note, including without limitation any other cost reasonably incurred by Noteholder pursuant to the terms of any credit facility of Noteholder.
​
Section 9.6.  Remedy.  Upon the occurrence and during the continuation of an Event of Default, the Noteholder shall have all of the rights and remedies provided in the applicable Uniform Commercial Code, this Note or any other agreement among Borrower and in favor of the Noteholder, as well as those rights and remedies provided by any other applicable law, rule or regulation.  In conjunction with and in addition to the foregoing rights and remedies of the Noteholder, the Noteholder may declare all indebtedness due under this Note, although otherwise unmatured, to be due and payable immediately without notice or demand whatsoever.  All rights and remedies of the Noteholder are cumulative and may be exercised singly or concurrently.  The failure to exercise any right or remedy will not be a waiver of such right or remedy.
​
Section 10.7.  Right of Offset.  The Noteholder shall have the right of offset against amounts that may be due by the Noteholder now or in the future to Borrower against amounts due under this Note.
​
Section 11.8.  Record of Outstanding Indebtedness.  The date and amount of each repayment of principal outstanding under this Note or interest thereon shall be recorded by Noteholder in its records.  The principal balance outstanding and all accrued or accruing interest owed under this Note as recorded by Noteholder in its records shall be the best evidence of the principal balance outstanding and all accrued or accruing interest owed under this Note; provided that the failure of Noteholder to so record or any error in so recording or computing any such amount owed shall not limit or otherwise affect the obligations of the Borrower under this Note to repay the principal balance outstanding and all accrued or accruing interest.
​
Section 12.9.  Waiver.  Borrower and each surety, endorser, guarantor, and other party now or subsequently liable for payment of this Note, severally waive demand, presentment for payment, notice of nonpayment, notice of dishonor, protest, notice of protest, notice of the intention to accelerate, notice of acceleration, diligence in collecting or bringing suit against any party liable on this Note, and further agree to any and all extensions, renewals, modifications, partial payments, substitutions of evidence of indebtedness, and the taking or release of any collateral with or without notice before or after demand by the Noteholder for payment under this Note.
​
Section 13.10.  Costs and Attorneys’ Fees.  In addition to any other amounts payable to Noteholder pursuant to the terms of this Note, in the event the Noteholder incurs costs in collecting on this Note, this Note is placed in the hands of any attorney for collection, suit is filed on this Note or if proceedings are had in bankruptcy, receivership, 

​
‌Page 2 of 5.

​

reorganization, or other legal or judicial proceedings for the collection of this Note, Borrower and any guarantor jointly and severally agree to pay on demand to the Noteholder all expenses and costs of collection, including, but not limited to, reasonable attorneys’ fees incurred in connection with any such collection, suit, or proceeding, in addition to the principal and interest then due.
​
Section 14.11.  Time of Essence.  Time is of the essence with respect to all of Borrower’s obligations and agreements under this Note.
​
Section 15.12.  Jurisdiction and Venue.  THIS NOTE SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE DOMESTIC LAWS OF THE STATE OF TEXAS, WITHOUT GIVING EFFECT TO ANY CHOICE OF LAW OR CONFLICT OF LAW PROVISION OR RULE (WHETHER OF THE STATE OF TEXAS OR ANY OTHER JURISDICTION) THAT WOULD CAUSE THE APPLICATION OF THE LAWS OF ANY JURISDICTION OTHER THAN THE STATE OF TEXAS.  BORROWER CONSENTS TO JURISDICTION IN THE COURTS LOCATED IN DALLAS, TEXAS.
​
Section 16.13.  Notice.  Any notice or demand required by this Note shall be deemed to have been given and received on the earlier of (i) when the notice or demand is actually received by the recipient or (ii) 72 hours after the notice is deposited in the United States mail, certified or registered, with postage prepaid, and addressed to the recipient.  The address for giving notice or demand under this Note (i) to the Noteholder shall be the place of payment specified in Section 3 or such other place as the Noteholder may specify in writing to the Borrower and (ii) to Borrower shall be the address below the Borrower’s signature or such other place as the Borrower may specify in writing to the Noteholder.
​
Section 17.14.  Amendment or Waiver of Provisions of this Note.  No amendment or waiver of any provision of this Note shall in any event be effective unless the same shall be in a writing referring to this Note and signed by the Borrower and the Noteholder.  Such amendment or waiver shall be effective only in the specific instance and for the specific purpose for which given.  No waiver of any of the provisions of this Note shall be deemed or shall constitute a waiver of any other provisions, whether or not similar, nor shall any waiver constitute a continuing waiver.
​
Section 18.14.  Successors and Assigns.  All of the covenants, obligations, promises and agreements contained in this Note made by Borrower shall be binding upon its successors and permitted assigns, as applicable.  Notwithstanding the foregoing, Borrower shall not assign this Note or its performance under this Note without the prior written consent of the Noteholder.  Noteholder at any time may assign this Note without the consent of Borrower.
​
Section 19  Definitions.  For purposes of this Note, the following terms shall have the following meanings:
​
(a)“Basis Point” shall mean 1/100th of 1 percent.
​
(b)“Business Day” shall mean any day banks are open in the state of Texas.
​
(c)(a)“Contract Rate” means the amount of any interest (including fees, charges or expenses or any other amounts that, under applicable law, are deemed interest) contracted for, charged or received by or for the account of Noteholder.
​
(d)(b)“Event of Default” wherever used herein, means any one of the following events:
​
(i)(i)the Borrower fails to pay any amount due on this Note and/or any fees or sums due under or in connection with this Note after any such payment otherwise becomes due and payable and three Business Days after demand for such payment;
​
(ii)(ii)the Borrower otherwise fails to perform or observe any other provision contained in this Note and such breach or failure to perform shall continue for a period of thirty days after notice thereof shall have been given to the Borrower by the Noteholder;
​
(iii)(iii)a case shall be commenced against Borrower, or Borrower shall file a petition commencing a case, under any provision of the Federal Bankruptcy Code of 1978, as amended, or shall seek relief under any provision of any other bankruptcy, reorganization, arrangement, 

​
‌Page 3 of 5.

​

insolvency, readjustment of debt, dissolution or liquidation law of any jurisdiction, whether now or hereafter in effect, or shall consent to the filing of any petition against it under such law, or Borrower shall make an assignment for the benefit of its creditors, or shall admit in writing its inability to pay its debts generally as they become due, or shall consent to the appointment of a receiver, trustee or liquidator of Borrower or all or any part of its property; or
​
(iv)(iv)an event occurs that, with notice or lapse of time, or both, would become any of the foregoing Events of Default.
​
(e)(d)“Final Payment Date” shall mean the earlier of:
​
		●	written demand by the Noteholder for payment of all or part of the unpaid principal, the accrued and unpaid interest thereon and the accrued and unpaid commitment fee thereon, but in any event no earlier than December 31, 2023; or

		●	acceleration as provided herein.

​
(f)(c)“Maximum Rate” shall mean the highest lawful rate permissible under applicable law for the use, forbearance or detention of money.
​
(g)“Prime Rate” shall mean the fluctuating interest rate per annum in effect from time to time equal to the base rate on corporate loans as reported as the Prime Rate in the Money Rates column of The Wall Street Journal or other reliable source.
​
(h)“Unused Commitment Amount” for any period on after the date of this Note shall mean the average on each day of such period of the difference between (A) $30,000,000.00 and (B) the amount of the unpaid principal balance of this Note.
​
(i)“Unused Commitment Fee” shall mean the product of (A) 50 Basis Points per annum (pro rated to take into account that the fee is payable quarterly, or such shorter period if applicable) and (B) the Unused Commitment Amount.
​
BORROWER:
​
Valhi, Inc.
​
​
​
​
		By:
	/s/ Amy A. Samford​ ​

Amy A. Samford
Senior Vice President and Chief Financial Officer
​
Address:
​
5430 LBJ Freeway, Suite 1700
Dallas, Texas   75240-2620
​

​
‌Page 4 of 5.

​

As of the date hereof, Kronos Worldwide, Inc., as the Noteholder, hereby agrees that this Note renews, replaces, amends and restates in its entirety the Prior Note, and that the unpaid principal of nil, the accrued and unpaid interest thereon of nil and the accrued and unpaid commitment fee thereon of nil that was owed under the Prior Note as of the close of business on December 31, 2021 are the unpaid principal, the accrued and unpaid interest thereon and the accrued and unpaid commitment fee thereon, respectively, owed under this Note as of the close of business on the date of this Note.
​
​
KRONOS WORLDWIDE, INC.
​
​
​
​
		By:
	/s/ Tim C. Hafer​ ​

Tim C. Hafer
Senior Vice President and Chief Financial Officer

​
‌Page 5 of 5.

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00341-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00341-of-00352.parquet"}]]