Employee Handbook

Academy of Traditional Karate, Inc. EMPLOYEE HANDBOOK

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Employee Handbook

Section 1 — Welcome Your Employment Here Our Philosophy Equal Employment Opportunity Policy At Will Employment Harassment Smoking Drug-free Workplace Violence in the Workplace Notification of Changes to Workplace Policies !Section 2 — Employment Procedures Employment Status Employee Categories Work Schedules Personnel Records Immigration Law Compliance Criminal Records Driver’s License and Driving Record Drug Testing Policy !Section 3 — Wages, Salaries, and Other Compensation Pay Period Pay Structure Payroll Deductions Changes to Your Deductions Garnishment Promotions and Job Performance !Section 4 — Attendance and Leave Policies Absences and Tardiness Election Day Jury Duty Family/Medical Leave !Section 5 — Insurance Medical !Section 6 — Vacation Policies Vacation Time Company Holidays !

Employee Handbook

Section 7 — Work Policies and Regulations Business Ethics Confidential Information Conflict of Interest Parking Personal Appearance Smoking Use of Telephone and On-line Services Violations that Result in Dismissal Separation Procedures Dress Policy !Section 8 — Safety in the Workplace Safety is Everybody’s Business Crime Fire Prevention In Case of Fire !Section 9 — Conflicts of Interest Employee Dating Weapons Violence Outside Employment !Appendix — Forms Substance Abuse Sexual Harassment Computer Use Policy Receipt and acknowledgement of Handbook !!

Employee Handbook

Section 1 – Academy of Traditional Karate, Inc. Philosophy !Welcome to the team of Academy of Traditional Karate, Inc.! The purpose of the employee handbook is to assist new employees in getting to know the company and its policies and also to ensure current employees are aware of the same policies. Please let us know if there is any part of the employee handbook that is unclear to you and we will be happy to clarify it for you. Please note there are three signatures required towards the end of this manual and, we require parents of employees under age 18 to sign the last page of this as well. !Your Employment Here !This handbook will answer some of the common questions posed by employees. Please read it thoroughly and carefully and learn its contents. If you have a question about a company policy that is not answered in this handbook, feel free to ask your direct supervisor. The policies and practices set forth in this handbook are not a contract and are therefore not intended to imply a contractual relationship. This is done with the employee agreement. !Our Philosophy !Academy of Traditional Karate, Inc. is a place of personal development. All staff have an interest in making sure this is a reality. SMILE and be POSITIVE. Any personal problems and challenges should not be discussed with the clients of Academy of Traditional Karate, Inc. This may cause conflicts of interest. It is our goal to build better families and stronger communities. Everything we do should be reflective of this basic philosophy. If you cannot be positive and promote Academy of Traditional Karate, Inc. in a positive way, this is not the right company for you. !Equal Employment Opportunity is Our Policy !Academy of Traditional Karate, Inc. is an equal employment opportunity employer where employment decisions are based on merit and business needs and not on race, ethnicity, national origin, gender, sexual orientation, religion, creed, physical or mental disability, medical condition, marital status, or veteran status. It is company policy to comply with the law regarding reasonable accommodation for handicapped and disabled employees. !Equal employment opportunity notices are posted near employee gathering places as required by law. These notices summarize the rights of employees to equal opportunity in employment and list the names and addresses of the various government agencies that may be contacted in the event that any person believes he or she has been discriminated against. !

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Employee Handbook

Management is primarily responsible for seeing that Academy of Traditional Karate, Inc. equal employment opportunity policies are implemented, but all members of the staff share in the responsibility for assuring that by their personal actions, the policies are effective and apply uniformly to everyone. !Any employees, including managers, involved in discriminatory practices will be subject to termination. !At-Will Employment !Unless your particular employment agreement states otherwise, your employment with Academy of Traditional Karate, Inc. is at-will. This means that neither you nor Academy of Traditional Karate, Inc. has entered into a contract regarding the duration of your employment. You are free to terminate your employment with Academy of Traditional Karate, Inc. at any time, with or without reason. Likewise, Academy of Traditional Karate, Inc. has the right to terminate the employee’s employment at any time, with or without reason. The relationship created by this situation is called “at-will” employment. !Harassment !Verbal, physical, and sexual harassment of co-workers, third parties, and members of the public is absolutely forbidden. Harassment can take many forms. A few examples of prohibited harassment (for illustrative purposes) include: racial, sexual, or ethnic jokes and insults; sexually suggestive or unwelcome touching or obscene gestures; insulting cartoons, sexually suggestive or lewd pictures or photographs. !If you observe situations that appear to be harassing in nature, whether by witnessing the incident or being told of it, you are required to report this situation to a company supervisor. All reports will be promptly investigated with due regard for the privacy of everyone involved. However, confidentiality cannot be guaranteed. Any employee found to have harassed a fellow employee or subordinate will be subject to severe disciplinary action up to and including termination. !Academy of Traditional Karate, Inc. accepts no liability for harassment of one employee by another employee. The individual who makes unwelcome advances, threatens, or in any way harasses another employee, is personally liable for such actions and their consequences. !!!!!

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Employee Handbook

!Smoking !Academy of Traditional Karate, Inc. is a non-smoking working environment. All employees are expected to abide by this policy while at work. !!Drug-free Workplace !Academy of Traditional Karate, Inc. is a community, in which responsibilities and freedoms are governed by policies and codes of behavior, including penalties for violations of the standards as stated in your Employee Handbook. Academy of Traditional Karate, Inc. has a standard of conduct that prohibits the unlawful possession, use, or distribution of illicit drugs and alcohol by employees on Academy of Traditional Karate, Inc. property. We will impose disciplinary actions on employees up to and including termination of employment. !It is the goal of Academy of Traditional Karate, Inc. to maintain a drug-free workplace. To that end, and in the spirit of the Drug-Free Workplace Act of 1988, Academy of Traditional Karate, Inc. has adopted the following codes: !

1. The unlawful manufacture, possession, distribution, or use of controlled substances is prohibited in the workplace. !

2. Employees who violate this prohibition are subject to corrective disciplinary action up to and including termination. !

3. As an ongoing condition of employment, employees are required to abide by this standard of conduct and to notify their manager, team leader, or designated supervisor, of any criminal drug statute conviction (or admission  tantamount to a conviction) that they receive, with such notification to be made in writing and to be submitted by the employee within five (5) days of such conviction or admission.!!

As an ongoing condition of employment, employees are required to abide by this prohibition and to notify, in writing and within five (5) days of the violation, his/her manager, team leader, designated supervisor, of any criminal drug statute conviction he/she receives. !

4. If an employee receives such a conviction Academy of Traditional Karate, Inc. shall take appropriate personnel action against the employee, up to and including termination.

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Employee Handbook

!!Violence in the Workplace Policy !Academy of Traditional Karate, Inc. has adopted a policy prohibiting criminal workplace violence. Consistent with this policy, acts or threats of criminal physical violence including intimidation, harassment, and/or coercion, which involve or affect Academy of Traditional Karate, Inc. or which occur on Academy of Traditional Karate, Inc. property will not be tolerated. !Specific examples of conduct, which may be considered threats or acts of criminal violence, include, but are not limited to, the following: !

1. Hitting or shoving an individual. !2. Threatening an individual or the individual’s family, friends, associates, or

property with harm. !3. Intentional destruction or threatening to destruct Academy of Traditional

Karate, Inc. property. !4. Making harassing or threatening telephone calls. !5. Harassing surveillance or stalking (following or watching someone). !6. Unauthorized possession or inappropriate use of firearms or weapons. !

Violations of this policy by any individual on Academy of Traditional Karate, Inc. property will lead to disciplinary action up to and including termination and/or legal action as appropriate. Every employee is encouraged to report incidents of threats or acts of criminal physical violence for which he or she is aware. The report should be made to management. !Notification of Changes to this Handbook !Any changes to this Employee Handbook will be given in writing and should be added to your own files. !!!

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Employee Handbook

Section 2 — Employment Procedures !Employment Status !Employment status is set forth in the employee agreement and established at time of hire. !Employee Categories !

• Introductory employees — Employees who have not yet completed the 3-month introductory period. !

• Regular, full-time employees — Employees who have completed their introductory period and work at least 40 hours per week. !

• Regular, part-time employees — Employees who have completed their introductory period and work less than 40 hours per week. !

• Salaried, part-time employees – Employees who have an agreement to work a set schedule and are paid a set amount of money per pay period. !

• Independent Contractors !Work Schedules !Work schedules will be determined for each individual employee. !Personnel Records !Academy of Traditional Karate, Inc. keeps a personnel file on each employee. The content of each employee’s file is open for inspection by the employee at reasonable intervals at the employee’s request. All employees have the duty to inform Academy of Traditional Karate, Inc. of any personal changes such as address, telephone number, emergency contacts, or changes in the number of dependents he or she is claiming. Academy of Traditional Karate, Inc. will keep all personnel records private, unless required by law to release certain information. !Immigration Law Compliance ! In accordance with the Immigration Reform and Control Act (IRCA), all employees, citizens, and non-citizens hired after November 6, 1986, must complete Section 1 of the Employment Eligibility Verification (Form I-9) form at the time of hire. The employer is responsible for ensuring that Section 1 is timely and properly completed. In fact, an individual may not begin employment unless this form is completed since employers are subject to civil or criminal penalties if

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they do not comply with IRCA. All offers of employment are contingent of verification of your right to work in the United States. On your first day of work you will be asked to provide original documents verifying your right to work and, as required by federal law, to sign Federal Form I-9. !Employment Eligibility !Verification Form. If you at any time cannot verify your right to work in the United States, Academy of Traditional Karate, Inc. may be obliged to terminate your employment. !!Criminal Records !In response to Academy of Traditional Karate, Inc. zero tolerance Violence in the Workplace Policy, Academy of Traditional Karate, Inc. may conduct a pre-employment criminal check on those applicants for positions that may involve close, unsupervised contact with the public, particularly minors. When appropriate, the criminal record is checked to protect Academy of Traditional Karate, Inc. interest of its employees and customers. !!Driver’s License and Driving Record !Employees whose work involves operation of a motor vehicle must present and maintain a valid driver’s license and a driving record acceptable to our insurer. You may be asked to submit a copy of your driving record to Academy of Traditional Karate, Inc. from time to time. Any changes in your driving record must be reported to your manager, supervisor, or team leader. Failure to do so may result in disciplinary action up to and including possible termination. !!Drug Testing !May or may not be required. This is at the school’s discretion. !!

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Section 3 — Wages, Salaries, and Compensation !Pay Period Paydays are on a BI-WEEKLY basis and paychecks are distributed every other Thursday. Pay periods will run on a TWO-WEEK cycle, and are distributed at the the dojo. This is current Academy of Traditional Karate, Inc. policy and is subject to change with two weeks notice. !Pay Structure !All salaries and wages for class instructors, managers, and staff will be negotiated and defined in employee agreements or set for by Academy of Traditional Karate, Inc. work structure. Your paycheck will include your pay for all time worked. Commissions are paid QUARTERLY. A combination of tenure and performance evaluations as well as the number of students will determine raises. !Payroll Deductions !We are required by federal and state laws to withhold the following deductions from your pay: !

• Federal Income Tax • FICA • Social Security • Medicare !

The amount of your deductions will depend on your earnings and on the information you furnish on your W-4 form regarding the number of exemptions you claim. If you wish to modify this number, please request a new W-4 from Management. Only you may modify your W-4 form. Verbal or written instructions are not sufficient to modify withholding allowances. We advise you to check your pay stub to ensure that it reflects the proper number of withholdings. !The W-2 form you receive annually reflects how much of your earnings were deducted for these purposes. Any other mandatory deductions to be made from your paycheck, such as court-ordered garnishments, will be explained whenever Academy of Traditional Karate, Inc. is ordered to make such deductions. !!!!!!

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Employee Handbook

!Changes to Deductions !If you marry, divorce, or change the number of exemptions in your family, you are required to immediately report the change to your manager or supervisor. !Garnishment !If we receive an order to garnish an employee’s wages, federal or state laws require that we comply with that order. A garnishment will reduce the garnished employee’s take-home pay. !Promotions and Job Performance !Your supervisor will review your job performance with you as he or she sees fit. For new employees, there will be an initial 90-day probationary period. Following your first year of service, there will be an annual evaluation. !The purposes of these evaluations are to: 1) evaluate the strengths and weaknesses of your performance; 2) communicate these with you; 3) get feedback from you regarding your position and your thoughts of the company; and, 4) set mutually satisfactory future performance goals. !!! !!

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Employee Handbook

Section 4 — Attendance and Leave Policies !Absences and Tardiness !If you cannot report to work you are expected to call your supervisor and tell him or her that you will not be coming in and when you expect to return. If you are absent two days without contacting your supervisor, we will assume you have voluntarily quit your job at the end of the second day. For class instructors, if you are unable to teach your assigned class, it is your responsibility to find a replacement instructor. If you are unable to do so, you must contact the Head Instructor, preferably 24 hours in advance but no later than 2 hours prior to the start of class. If you fail to do so, this will account for an unexcused absence. Excessive absences and failure to report absences on time will lead to discipline up to, and including, discharge. !Secondly, you must arrive at your job and be ready to start work at the beginning of your scheduled time to work. Tardiness may lead to discipline up to, and including, discharge. We know traffic and weather conditions may cause you to be late once in a while. However, if this happens on a continuous basis, or if you demonstrate a pattern of tardiness, you may be disciplined up to, and including, discharge. !Election Day !We encourage you to exercise your voting privileges in local, state, and national elections. However, since the polls are open for extended hours, you are encouraged to vote before or after regular working hours. !Jury Duty !It is your civic duty as a citizen to report for jury duty whenever called. If you are called for jury duty, you must notify your supervisor within 1 week of receipt of the jury summons. !Family/Medical Leave of Absence !Eligible employees may be entitled to job-protected family or medical leaves of absence if they are unable to come to work due to pressing family or medical concerns. !!!

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Employee Handbook

Section 5 — Insurance !Medical Insurance !Medical insurance may be available for full-time employees on a case by case basis and as set forth with our insurance carrier. Academy of Traditional Karate, Inc. has certain requirements that meet federal laws about who and how much insurance is offered. Please direct all questions to the office regarding health insurance. !!

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Section 6 — Vacation Policies !Vacation Time !If you are a regular, full-time employee or salaried employee, you are entitled to paid vacation days following 1 year of service. Temporary and introductory and part-time employees are not eligible for paid vacation days. All employees are asked to submit vacation requests as soon as possible and are required to give 2 weeks notice. The company will schedule vacations based on seniority and the operational needs of the company. Full-time employees are expected to take the 4th of July and Christmas week off when the Academy is closed. !Company Holidays !The company provides the following paid holidays each: New Year’s Day, Thanksgiving Day and the Friday following Thanksgiving Day Christmas Eve, Christmas Day, and the day after Christmas. These and other paid holidays may be added or subtracted at management’s discretion. Paid holidays apply to salaried employees only. !!!!!!!!!!!!!!!!!!!!!!!!!!

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Employee Handbook

Section 7 — Work Policies and Regulations !Business Ethics !The company expects its employees to act in accordance with the highest standards of business ethics both on and off company premises, and while conducting business on the company’s behalf. !Confidential Information !As an employee of Academy of Traditional Karate, Inc., you may come into possession of trade secrets or confidential information that belongs to the company, and that such information, whether about our company, our customers, our suppliers, or employees, is strictly confidential. All confidential information must not be disclosed to anyone, including family members outside the company, or to any company employee who is not entitled to the information, either during or after your employment. Any doubts about the confidentiality of information should be resolved in favor of confidentiality. !!Conflict of Interest !Employees are expected to avoid situations that create an actual or potential conflict with the company’s interests or that could interfere with the employee’s duty and ability to best serve the company. Employees who are unsure about whether a conflict exists should consult his or her supervisor. Engaging in any other employment or personal activity during company work hours, or using the company’s name, stationery, supplies, or other property for personal purposes can be deemed a conflict of interest. !When a conflict of interest is found to exist, the conflict may result in disciplinary action or, when appropriate, termination of employment.* !*Key personnel may be required to sign a non-compete clause. !Parking !All employees are required to park in the designated spaces at the rear of the parking lot. Please keep in mind that the parking spaces adjacent to or in front of our building(s) are for customers and visitors only. Remember to lock your car every day and park within the specified areas. !!!!

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Employee Handbook

!Personal Appearance/Clothing !A professional appearance is essential to your job. You must practice good grooming and personal hygiene and dress appropriately for the job you are assigned to do. All personnel are expected to dress in accordance with the company dress policy. !Smoking !Academy of Traditional Karate, Inc. is a smoke-free work place. !Use of Telephone and On-line Services !All telephones are to be used for business use only. Personal calls must be kept to a minimum. No long-distance telephone calls for personal use will be permitted and any violation of this may result in discharge and the employee will be required to pay for such charges. On-line services may be used for business use only. !!Violations that Result in Dismissal !You may be terminated for poor performance, misconduct, excessive absences, tardiness, or other violations of the company rules. However, your employment is at-will and you and the company has the right to terminate your employment for any legal reason or no reason, upon notice to each other. We may need to terminate your employment because of reorganization, job elimination, economic downturns, or lack of work. Should we decide that such termination is necessary, we will try to give as much advance notice as is practical. !Violations for which you may be dismissed without notice include, but not limited to: !

1. Malicious or willful destruction or damage to company property or supplies. !2. Malicious or willful destruction or damage to property of an employee or

others. !3. Stealing or removing company property without permission. !4. Stealing or removing the property of an employee, customer,

or visitor without permission. !5. Obtaining your job by lying or giving false or misleading information. !

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6. Falsifying any employee documents or records, time cards, and other acts of dishonesty. !7. Possessing firearms, weapons, and hazardous devices or substances on

company property. !8. Reporting for duty under the influence of alcohol or drugs. !9. Insubordination, including improper conduct toward a supervisor and

refusal to perform tasks. 10. Fighting on company property. !11. Harassing, threatening, intimidating, or coercing a supervisor or

another employee. !12. Giving away company products or services for free or at a discount in

violation of company policies. !13. Failure to follow company procedures for maintaining the confidentiality of

the company’s proprietary information and trade secrets. !14. Representing the company, its product, or its officer to the detriment of

the company and/or its reputation. !!Separation Procedures !Upon departure of employment, the employee must return all keys, supplies, and other company property when the employee picks up his or her final paycheck. !If the employee has accrued vacation time, the employee will be paid for any unused time. The employee will not, however, be compensated for unused sick leave. !!!!!!!!!!!

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Dress Policy !Team members may always wear their uniform (in good, clean condition) in place of the standard dress policy. When in doubt, please ask your direct supervisor.* !Shirts Academy of Traditional Karate, Inc. team members must always wear a polo-style Academy of Traditional Karate, Inc. logo shirt. Shirts must be tucked in at all times. !T-shirts T-shirts, cut-off/half-shirts, and tank tops are not permitted, unless for a special event (which will be noted in a memo to all staff members), or unless the management authorizes different style of uniform in writing. !Shoes Acceptable: Dress shoes may be worn with dress pants. Clean sneakers or tennis shoes. !Not Acceptable: High-top shoes may not be worn with shorts. Flip flops (except during summer camp activities). Sandals. !Special exceptions, where appropriate, may be made to the standard dress code. *This dress code applies on all of the Academy of Traditional Karate, Inc. premises, even if you are not “working” at the time. Professionalism must be kept whenever you are present at Academy of Traditional Karate, Inc. functions.

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Section 8 — Safety in the Workplace !Safety is everybody’s business. !As such, it is to be given primary importance in every aspect of Academy of Traditional Karate, Inc. activities. Remember to report any suspected hazards and all accidents to Management. !Maintaining the security of Academy of Traditional Karate, Inc. building(s) and vehicles is every employee’s responsibility. Develop habits that insure security as a matter of course. !For example: !

• Always keep cash properly secured. If you are aware that cash is insecurely stored, immediately inform the person responsible. !

• Know the location of all alarms and fire extinguishers, and familiarize yourself with the proper procedure for using them, should the need arise. !

• When you leave the Academy of Traditional Karate, Inc. premises, make sure all entrances are properly locked and secured. !

Crime !Your safety is our biggest concern. For your safety, you must follow these procedures if a crime occurs while you are on the premises: !

1. Do not resist a person committing a crime if there is a chance that you would endanger yourself or any member or guest of the dojo. !

2. As quickly as possible after the crime is committed, contact the local police department and write down all the details of the crime. !

3. List the names of the employees and other individuals at the scene and ask them to stay until the police arrive or get their names and where they can be reached. !

4. Do not try to be a “hero.” !!

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!!Fire Prevention !Know the location of the fire extinguisher(s) in the school and make sure they are kept clear at all times. Notify your team leader if an extinguisher is used or if the seal is broken. Keep in mind, extinguishers that are rated “ABC” can be used for paper, wood, or electrical fires. Make sure all flammable liquids, such as alcohol, are stored in approved and appropriately labeled safety containers and are not exposed to any ignition source. !In Case of Fire !If you are aware of a fire, you should: !

• Dial 911 or the local fire department. !• If possible, immediately contact your supervisor or team leader. Evacuate

all team members and clients from the area. !• If the fire is small and contained, locate the nearest fire extinguisher. This

should only be attempted by employees who are knowledgeable in the correct use of fire extinguishers. !

• If the fire is out of control, leave the area immediately. No attempt should be made to fight the fire. !

When the fire department arrives, direct the crew to the fire. Do not re-enter the building until directed to do so by the fire department.

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Section 9 — Conflicts of Interest !Employee Dating !Employee/student dating is not permitted at Academy of Traditional Karate, Inc.. Dating between employees may be permitted and will be determined on a case-by-case basis. Specifically, employees who are in a teacher-student relationship will NOT be permitted to date and continue to be employed at the Academy of Traditional Karate, Inc. Employees who wish to enter into a dating relationship will be required to sign an ACKNOWLEDGMENT AND WAIVER REGARDING EMPLOYEE DATING. !Weapons !Academy of Traditional Karate, Inc. believes it is important to establish a clear policy that addresses weapons in the workplace. Specifically, Academy of Traditional Karate, Inc. prohibits all persons who enter company property from carrying a handgun, firearm, knife, or other prohibited weapon of any kind, regardless of whether or not the person is licensed to carry the weapon. The only exception to this policy will be police officers, security guards, or other persons who have been given written consent by Academy of Traditional Karate, Inc. to carry a weapon on the property. Any employee who chooses to disregard this policy will be subject to immediate termination.* !*Exception: Weapons used in a curriculum. !Violence in the Workplace !Academy of Traditional Karate, Inc. has adopted a policy prohibiting workplace violence. Consistent with this policy, acts or threats of physical violence, including intimidation, harassment, and/or coercion, which involve or affect Academy of Traditional Karate, Inc., its employees, or clients, or which occur on company property, will not be tolerated. !Outside Employment !If your financial situation requires you to hold a second job, part-time, or full-time, or if you engage in a business enterprise of your own, Academy of Traditional Karate, Inc. would like to know about it. Before accepting any outside employment you are encouraged to discuss the matter with your supervisor or team leader. !!

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Appendix — Forms !• Substance Abuse • Sexual Harassment • Computer Use Policy • Receipt and Acknowledgment of Academy of Traditional Karate, Inc.

Employee Handbook !!

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SUBSTANCE ABUSE I am aware that it is Academy of Traditional Karate, Inc. policy to employ a work force free from alcohol abuse or the use of illegal drugs. Any employee who violates this policy will be disciplined. This may include termination, even for a first offense. !I am aware that Academy of Traditional Karate, Inc. strives to provide a safe and healthy work environment, free from the use of illegal drugs* and abuse of alcohol and has, therefore, set forth the following rules: !1. Employees may not consume alcoholic beverages or take illegal

drugs on Academy of Traditional Karate, Inc. premises. !2. Employees may not report to work under the influence of drugs

or alcohol. !I am aware that if I am convicted under any federal or state criminal drug statute, I must notify a member of management within five (5) days. !I am aware that failure to notify a member of management within five (5) days will be grounds for termination. !*Legal drugs include prescribed and over-the-counter drugs that have been legally obtained and used for the purpose for which they were intended. Illegal drugs include any drug that is not legally obtainable, which may be obtainable but has not been legally obtained or which is being used in a manner or for a purpose other than as prescribed. !!!! _____________ Employee Printed Name Position !!!! _____________ Employee Signature Date !! ! ! Employee Parent’s Signature (if under 18) Date !!!!

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ACKNOWLEDGEMENT OF SEXUAL HARASSMENT POLICY !I understand, that it is Academy of Traditional Karate, Inc. policy, in accordance with providing a positive, discrimination-free work environment, that sexual harassment in the workplace is unacceptable conduct that will not be condoned. !I understand that sexual harassment is unsolicited, non-reciprocal behavior by an employee who is in a position to control or affect another person’s job status and who uses the power or authority of that position to cause that employee to submit to sexual activity, or to fear that he or she would be punished for refusal to submit. !I understand that sexual harassment also includes any employee conduct unreasonably interfering with another’s work performance by creating an intimidating, hostile, or offensive working environment. Sexual harassment consists of a variety of behaviors by employees directed to other employees including, but not limited to, subtle pressure for sexual activity, inappropriate touching, inappropriate language, demands for sexual favors, and physical assault. !I understand that Academy of Traditional Karate, Inc. will treat sexual harassment as any other form of misconduct. Employees who engage in harassing behavior will be disciplined appropriately. Employees who are sexually harassed are encouraged to discuss the situation with their supervisor or with an officer of the firm. !!!Employee Printed Name Position !!!! !!Employee Signature Date !!!!! ! Employee Parent’s Signature (if under 18) Date !!!

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COMPUTER USE POLICY !

SECTION ONE !PURPOSE !A. To remain competitive, better serve our customers and provide our

employees with the best tools to do their jobs, Academy of Traditional Karate, Inc. makes available to our workforce access to one or more forms of electronic media and services, including computers, e-mail, telephones, voicemail, fax machines, external electronic bulletin boards, wire services, online services, intranet, Internet, and the World Wide Web. !

B. Academy of Traditional Karate, Inc. encourages the use of these media and associated services because they can make communication more efficient and effective and because they are valuable sources of information about vendors, customers, technology, and new products and services. However, all employees and everyone connected with the organization should remember that electronic media and services provided by the company are company property and their purpose is to facilitate and support company business. All computer users have the responsibility to use these resources in a professional, ethical, and lawful manner. !

C. To ensure that all employees are responsible, the following guidelines have been established for using e-mail and the Internet. No policy can lay down rules to cover every possible situation. Instead, it is designed to express Academy of Traditional Karate, Inc. philosophy and set forth general principles when using electronic media and services. ! !!

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!!SECTION TWO !

PROHIBITED COMMUNICATIONS !Electronic media cannot be used for knowingly transmitting, retrieving, or storing any communication that is: !

1. Discriminatory or harassing; !2. Derogatory to any individual or group; !3. Obscene, sexually explicit or pornographic; !4. Defamatory or threatening; !5. In violation of any license governing the use of software; or !6. Engaged in for any purpose that is illegal or contrary to

Academy of Traditional Karate, Inc. policy or business interests. !

SECTION THREE !PERSONAL USE !The computers, electronic media, and services provided by Academy of Traditional Karate, Inc. are primarily for business use to assist employees in the performance of their jobs. Limited, occasional, or incidental use of electronic media (sending or receiving) for personal, non-business purposes is understandable and acceptable, and all such use should be done in a manner that does not negatively affect the systems’ use for their business purposes. However, employees are expected to demonstrate a sense of responsibility and not abuse this privilege. !!

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!!SECTION FOUR !

ACCESS TO EMPLOYEE COMMUNICATIONS !A. Generally, electronic information created and/or communicated by

an employee using e-mail, word processing, utility programs, spreadsheets, voicemail, telephones, Internet and bulletin board system access, and similar electronic media is not reviewed by the company. However, the following conditions should be noted:Academy of Traditional Karate, Inc. does routinely gather logs for most electronic activities or monitor employee communications directly, e.g., telephone numbers dialed, sites accessed, call length, and time at which calls are made, for the following purposes: !

1. Cost analysis 2. Resource allocation 3. Optimum technical management of information resources 4. Detecting patterns of use that indicate employees are

violating company policies or engaging in illegal activity. !B. Academy of Traditional Karate, Inc. reserves the right, at its

discretion, to review any employee’s electronic files and messages to the extent necessary to ensure electronic media and services are being used in compliance with the law, this policy, and other company policies. !

C. Employees should not assume electronic communications are completely private. Accordingly, if they have sensitive information to transmit, they should use other means. !

SECTION FIVE !SOFTWARE !To prevent computer viruses from being transmitted through the company’s computer system, unauthorized downloading of any unauthorized software is strictly prohibited. Only software registered through Academy of Traditional Karate, Inc. may be downloaded. Employees should contact the system administrator if they have any questions. !

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!!SECTION SIX !

SECURITY/APPROPRIATE USE !A. Employees must respect the confidentiality of other individuals’

electronic communications. Except in cases in which explicit authorization has been granted by company management, employees are prohibited from engaging in, or attempting to engage in: !

1. Monitoring or intercepting the files or electronic communications of other employees or third parties; !

2. Hacking or obtaining access to systems or accounts they are not authorized to use; !

3. Using other people’s log-ins or passwords; and !4. Breaching, testing, or monitoring computer or network

security measures. !B. No e-mail or other electronic communications can be sent that

attempt to hide the identity of the sender or represent the sender as someone else.

C. Electronic media and services should not be used in a mannerthat is likely to cause network congestion or significantly hamper the ability of other people to access and use the system. !

D. Anyone obtaining electronic access to other companies’ or individuals’ materials must respect all copyrights and cannot copy, retrieve, modify, or forward copyrighted materials except as permitted by the copyright owner. !

SECTION SEVEN !ENCRYPTION !Employees can use encryption software supplied to them by the systems administrator for purposes of safeguarding sensitive or confidential business information. Employees who use encryption on files stored on a company computer must provide their supervisor with a sealed hard copy record (to be retained in a secure location) of all of the passwords and/or encryption keys necessary to access the files.

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!!SECTION EIGHT !

PARTICIPATION IN ONLINE FORUMS !A. Employees should remember that any messages or information sent on

company-provided facilities to one or more individuals via an electronic network—for example, Internet mailing lists, bulletin boards, and online services—are statements identifiable and attributable to Academy of Traditional Karate, Inc.. !

B. Academy of Traditional Karate, Inc. recognizes that participation in some forums might be important to the performance of an employee’s job. For instance, an employee might find the answer to a technical problem by consulting members of a news group devoted to the technical area. !

SECTION NINE !VIOLATIONS !Any employee who abuses the privilege of their access to e-mail or the Internet in violation of this policy will be subject to corrective action, including possible termination of employment, legal action, and criminal liability. !!!!!!!!!!!!!!!!!!!!!!

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Employee Handbook

!!!SECTION TEN !

EMPLOYEE AGREEMENT ON USE OF E-MAIL AND THE INTERNET !I have read, understand, and agree to comply with the foregoing policies, rules, and conditions governing the use of the Company’s computer and telecommunications equipment and services. I understand that I have no expectation of privacy when I use any of the telecommunication equipment or services. I am aware that violations of this guideline on appropriate use of the e-mail and Internet systems may subject me to disciplinary action, including termination from employment, legal action and criminal liability. I further understand that my use of the e-mail and Internet may reflect on the image of Academy of Traditional Karate, Inc. to our customers, competitors and suppliers and that I have responsibility to maintain a positive representation of the company. Furthermore, I understand that this policy can be amended at any time. !!!_____________________ _____________________ Employee Printed Name Position !!!! _____________________ ____________________ Employee Signature Date !!!! ! Employee Parent’s Signature (if under 18) Date !!!!!!!!!!!

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Employee Handbook

SECTION ELEVEN !EMPLOYEE AGREEMENT ON BINDING ARBITRATION !

1. If a controversy between the Academy of Traditional Karate, Inc. and you should arise, then not later than one (1) year from the date of the event which is the subject of dispute, either party may serve on the other a written notice specifying the existence of such controversy and setting forth in reasonably specific detail the grounds thereof (“Notice of Controversy”), provided that, in any event, the party shall have at least thirty (30) days from and after the date of the Notice of Controversy to serve a written notice of any counterclaim (“Notice of Counterclaim”). The Notice of Counterclaim shall specify the claim or claims in reasonably specific detail. !2. Following receipt of the Notice of Controversy (or any Notice of Counterclaim), there shall be a three-week period during which the parties will make a good faith effort to resolve the dispute through negotiation (“Period of Negotiation”). Neither party shall take any action during the Period of Negotiation to initiate arbitration proceedings. !3. If the parties should agree during the Period of Negotiation to mediate the dispute, then the Period of Negotiation shall be extended by an amount of time to be agreed upon by the parties to permit such mediation. In no event, however, may the Period of Negotiation be extended by more than five (5) weeks or, stated differently, in no event may the Period of Negotiation be extended to encompass more than a total of eight (8) weeks. !4. If the parties agree to mediate the dispute but are unable to agree within a week on the format and procedures for the mediation, then the effort to mediate shall cease and the Period of Negotiation shall terminate four weeks from the Notice of Controversy (or the Notice of Counterclaim, as the case may be). !5. Following the termination of the Period of Negotiation, the dispute (including the main claim and any counterclaim) shall be settled by arbitration governed by the arbitration rules of the American Arbitration Association (“AAA”). The format and procedures of the arbitration are set forth below (referred to below as the “Arbitration Agreement”). !6. A notice of intention to arbitrate (“Notice of Arbitration”) shall be served within thirty (30) days of the termination of the Period of Negotiation. !7. The arbitration, including the Notice of Arbitration, will be governed by the National Rules for the Resolution of Employment Disputes of the AAA in effect on the date of the Notice of Arbitration, except that the terms of this Arbitration Agreement shall control in the event of any difference or conflict between such Rules and the terms of this Arbitration Agreement.

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!8. The arbitrator shall reach a decision on the merits on the basis of applicable legal principles as embodied in the law of the Commonwealth of Massachusetts. The arbitration hearing shall take place in Boston unless the parties agree in writing to a different location. !9.There shall be one arbitrator regardless of the amount in controversy. In order to be eligible to serve, the arbitrator shall be in the Boston area and have at least 10 years experience with employment law litigation. In the event the parties cannot agree on a mutually acceptable single arbitrator from the list submitted by the AAA, the AAA shall appoint an arbitrator who shall meet the foregoing criteria. At the time of appointment and as a condition thereto, the arbitrator will be apprised of the time limitations and other provisions of this Arbitration Agreement and shall indicate such dispute resolver’s agreement to comply with such provisions and time limitations. !10. During the thirty (30) day period following appointment of the arbitrator, either party may serve on the other a request for limited numbers of documents directly related to the dispute. Such documents shall be produced within fifteen (15) days of the request. Following the thirty (30) day period of document production, there will be a forty- five (45) day period during which limited depositions will be permissible. Disputes as to discovery or pre-hearing matters of a procedural nature shall be promptly submitted to the arbitrator. The arbitrator shall make every effort to render a ruling on such interim matters within five (5) business days. The arbitrator shall make every effort to commence the hearing within thirty (30) days of the conclusion of the deposition period and, in addition, will make every effort to conduct the hearing on consecutive business days to conclusion. !11. Either party may, at its own expense, have the arbitration proceedings recorded by a certified court reporter or by supplying its own tape recorder. !12. An award will be rendered within thirty (30) days of the close of the arbitration hearing and at the latest within eight (8) months of the date of the Notice of Arbitration. The award shall set forth the grounds for the decision (findings of fact and conclusions of law) in reasonably specific detail. !13. The award shall be final and nonappealable except as provided in the AAA rules and except that a court of competent jurisdiction shall have the power to review whether, as a matter of law, based on the findings of fact by the arbitrator, the award should be confirmed, modified or vacated. Such judicial review shall be final and binding on the parties. !14. The cost of any arbitration, excluding attorneys’ fees and expenses incurred by the parties, will be split evenly by the parties. The cost of attorney's fees will be borne by the non-prevailing party.

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Employee Handbook

Receipt and Acknowledgment of Academy of Traditional Karate, Inc. Employee Handbook Please read the following statements, sign, and return to your supervisor or team leader. !Understanding and Acknowledging Receipt of Academy of Traditional Karate, Inc. Employee Handbook I have received and read a copy of the Academy of Traditional Karate, Inc. Employee Handbook. I understand that the policies and benefits described within are subject to change at the sole discretion of the company at any time. !At-Will Employment I further understand that my employment is at-will, and neither myself nor Academy of Traditional Karate, Inc. has entered into a contract regarding the duration of my employment. I am free to terminate my employment with Academy of Traditional Karate, Inc. at any time, with or without reason. Likewise, Academy of Traditional Karate, Inc. has the right to terminate my employment, or otherwise discipline, transfer, or demote me at any time, with or without reason, at the discretion of Academy of Traditional Karate, Inc.. !Confidential Information I am aware that during the course of my employment, confidential information will be made available to me, for instance, product designs, marketing strategies, customer lists, pricing policies, and other related information. I understand that this information is proprietary and critical to the success of Academy of Traditional Karate, Inc. and must not be given out or used outside of Academy of Traditional Karate, Inc. premises or with non-company employees. In the event of termination of employment, whether voluntary or involuntary, I hereby agree not to utilize or exploit this information with any other individual or company. !! ! Employee Printed Name Position !! ! Employee Signature Date !! ! Employee Parent’s Signature (if under 18) Date !! ! Employee Address !! ! ! ! City State ZIP SSN

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