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                                                                   EXHIBIT 10.41

                                    ADDENDUM

         THIS ADDENDUM to the Franchise Agreement ("Franchise Agreement")
described on the Franchisee Joinder attached hereto is made and entered into
between The Princeton Review Management Corp. (the "Franchisor") and the person
identified on the Franchisee Joinder attached hereto (the "Franchisee")
effective as of May 31, 1995. This Addendum is intended by the parties to add
to, modify and interpret the said Franchise Agreement, and to replace and take
precedence over any term, provision or condition thereof which may be contrary
to, or inconsistent with any provision of this Addendum. Capitalized terms used
herein which are not defined herein shall have the meaning given by the
provisions of the Franchise Agreement.

         NOW, THEREFORE, the parties agree as follows:

1.       Zee Votes. When a "Zee Vote" is required under this Addendum in order
         to approve a Franchisor-proposed action, Franchisor shall conduct a
         vote of the Domestic Franchisee Group (as such term is defined in
         Paragraph 1.4 below) in accordance with the provisions hereof. When
         franchisees in the Domestic Franchisee Group, which together pay no
         less than the requisite percentage of the total domestic royalties
         received in the prior twelve (12) months by Franchisor from all of the
         franchisees in the Domestic Franchisee Group, vote in favor of the
         proposed action ("Zee Vote"), approval shall be deemed given by the
         entire Domestic Franchisee Group. As used in the immediately preceding
         sentence, the term "domestic royalties" shall refer to the royalties
         payable to Franchisor in respect of franchisee operations in the United
         States only.

         1.1      Votes of the Domestic Franchisee Group shall be cast by
                  written ballot manually signed by a duly authorized
                  representative of each franchisee in the Domestic Franchisee
                  Group. Franchisor shall be responsible for preparing and
                  distributing ballots to all franchisees in the Domestic
                  Franchisee Group which shall set forth the proposed action in
                  reasonable detail, the percentage of the vote represented by
                  each franchisee in the Domestic Franchisee Group (assuming
                  voting participation by all franchisees in the Domestic
                  Franchisee Group), any explanatory or policy statements
                  appropriate in the judgment of Franchisor, and the place to,
                  and the date by which, ballots must be returned.
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         1.2      Unless otherwise stated in the ballot, any franchisee ballot
                  not voted, signed and returned by the time specified ("end
                  date"), which unless waived by Franchisee shall not be less
                  than fourteen (14) days from the date delivered to Franchisee,
                  shall be counted as an abstention, and any abstention shall
                  not be factored into the requisite percentage calculation.

         1.3      Within 15 days following the end date of a Zee Vote,
                  Franchisor shall notify Franchisee of the percentage vote (as
                  defined in paragraph 1, above) cast in favor of the proposal.
                  Upon the written request of Franchisee, Franchisor shall
                  disclose to Franchisee the vote and percentage of each
                  franchisee in the Domestic Franchisee Group with respect to
                  any Zee Vote. Franchisee hereby authorizes Franchisor to
                  provide such information concerning its vote to any other
                  franchisee in the Domestic Franchisee Group.

         1.4      As used herein, the term "Domestic Franchisee Group" shall
                  mean and include all of The Princeton Review test preparation
                  franchisees having a "Territory" (which as used herein means,
                  with respect to any franchisee, the geographical area
                  specified in Section I.A.1. of the Franchise Agreement
                  previously entered into by and between Franchisor and such
                  franchisee) located in the United States, whether or not such
                  franchisee is an Affiliate of Franchisor, who are in operation
                  as of the distribution date of the ballots applicable to the
                  Zee Vote at issue and who have executed an Addendum to their
                  respective Franchise Agreement identical in all material terms
                  to this Addendum (including any subsequent amendments hereto).
                  Those members of the Domestic Franchisee Group which are not
                  Affiliates of Franchisor shall be referred to as "Independent
                  Franchisees".

         1.5      As used herein, the term "Affiliate" shall mean, with respect
                  to any person, any other person that, directly or indirectly,
                  through one or more intermediaries, controls, is controlled
                  by, or is under common control with, the person specified. The
                  term "control" (including, with correlative meanings, the
                  terms "controlled by" and "under common control with"), when
                  used with respect to any specified person, means the power to
                  direct the management and policies of such person, directly or
                  indirectly, whether through the ownership of voting
                  securities, by contract or otherwise.

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2.       National Accounts. Franchisor shall have the right in Franchisee's
         Territory to market TPR Services (as such term is defined in Paragraph
         2.1 below) to national accounts, at a price to be determined by
         Franchisor, subject to the terms of this paragraph.

         2.1      A "national account" is an organization having facilities,
                  personnel, customers, or members located within the Territory
                  of three or more Franchise Families and which has entered into
                  an agreement with Franchisor to promote, endorse, sponsor,
                  recommend, permit or cooperate with the marketing of The
                  Princeton Review services in their facilities or to their
                  personnel, customers, or members. "TPR Services" shall mean,
                  at any time, those business activities then engaged in by The
                  Princeton Review franchisees in the Domestic Franchisee Group
                  and which are regularly offered to the public for a fee. As
                  used herein, the term "Franchise Family" shall mean one or
                  more franchisees which are Affiliates of one another. When
                  used in relation to a Franchise Family, the term "Territory"
                  shall mean the geographical areas encompassed by all of the
                  Territories of all the franchisees in such Franchise Family.

         2.2      Franchisee agrees to provide TPR Services to a national
                  account at the request of Franchisor, provided that the
                  following limiting provisions shall apply:

                  (a)      The Franchisee shall not be required to provide any
                           TPR Services to a national account pursuant to these
                           provisions which require a price discount of more
                           than the lesser of $50.00 or 15% ("Maximum Discount
                           Amount") from the Franchisee's standard retail
                           prices. The reference to $50.00 in the immediately
                           preceding sentence shall be annually adjusted for
                           increases occurring after the first anniversary of
                           this Addendum in the Consumer Price Index for All
                           Urban Consumers ("CPI") as published by the Bureau of
                           Labor Statistics. The Maximum Discount Amount may be
                           changed by a 75% Zee Vote.

                  (b)      Any and all revenues that may be received by the
                           Franchisor from national accounts for the sale of any
                           TPR Services in the Franchisee's Territory shall be
                           forwarded to the Franchisee within fourteen (14) days
                           following receipt thereof by the Franchisor. All such
                           revenues shall constitute Franchisee Gross Receipts
                           under the Franchise Agreement.

                  (c)      The Franchisee shall not be required to provide any
                           TPR Services to a national account pursuant to these
                           provisions at a location which is more

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                           than 50 miles from any permanent office of the
                           Franchisee if the Franchisee can demonstrate that the
                           amount of direct costs which will be incurred in
                           performing such TPR Services will exceed the amount
                           of revenues to be derived (net of all sales taxes and
                           royalty and advertising fees to Franchisor) from such
                           TPR Services.

         2.3      If more than 50% of the personnel, customers, or members of a
                  national account are located in the Territory of a Franchise
                  Family (as defined in Section 2.1) which includes Franchisee,
                  then any agreement made by Franchisor with such national
                  account pursuant to any part of paragraph 2 is subject to
                  Franchisee's approval, such approval not to be unreasonably
                  withheld. Franchisor shall give Franchisee notice in writing
                  or by fax or electronic mail of a proposed marketing
                  agreement. If Franchisee does not expressly in writing or by
                  electronic mail disapprove of the proposal giving its reasons
                  therefor within ten (10) days following receipt of notice,
                  approval shall be deemed to have been given.

3.       Interactive Technology Products. Notwithstanding any provision to the
         contrary contained in the Franchise Agreement, but subject to the terms
         and conditions contained in this Section 3, Franchisor shall have the
         right to market and sell in Franchisee's Territory instruction
         delivered through real time (i.e. contemporaneous, and not pre-recorded
         or delayed transmissions) interactive technology which simulates a
         classroom or tutoring experience ("Interactive Product").

         3.1      Franchisor may not market or sell any Interactive Product in
                  Franchisee's Territory unless the franchisees which are
                  Affiliates of Franchisor generally market and sell that same
                  Interactive Product at substantially similar prices.

         3.2      All revenues that are received by the Franchisor from the sale
                  of any Interactive Product in the Franchisee's Territory
                  ("Interactive Product Revenues") shall be forwarded to the
                  Franchisee within fourteen (14) days following the end of the
                  month in which they were received by the Franchisor. All such
                  revenues shall constitute Franchisee Gross Receipts under the
                  Franchise Agreement.

         3.3      In connection with the marketing and sale of an Interactive
                  Product in Franchisee's Territory, Franchisee shall provide
                  such reasonable and necessary services in support of such
                  Interactive Product as may be requested by Franchisor unless
                  the Franchisee can demonstrate that the amount of direct costs
                  which will

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                  be incurred in performing such services will exceed the amount
                  of revenues to be derived by Franchisee (net of all sales
                  taxes and royalty and advertising fees to Franchisor) from the
                  sale of such Interactive Product. Notwithstanding the
                  foregoing, the Franchisee shall not be required to provide any
                  services pursuant to this Section 3.3 which are not similar to
                  the types of services ordinarily provided by the Franchisee in
                  the conduct of its business under the Franchise Agreement.

         3.4      Franchisor may deduct and retain from Interactive Product
                  Revenues the amount of direct costs actually paid by
                  Franchisor which are properly allocable to the sale or
                  marketing of an Interactive Product in Franchisee's Territory.
                  Franchisee Gross Receipts subject to royalty-service and
                  advertising fee payments under the Franchise Agreement and
                  attributable to an Interactive Product shall be reduced by
                  twice the Interactive Excess, as hereafter defined, of such
                  product. If any direct costs are payable to Franchisor or any
                  Affiliate of Franchisor, the amount thereof shall not exceed
                  the amount which would be paid for the same or comparable
                  product or service sold or provided by a third party in an
                  arms-length transaction. As used above, the term "Interactive
                  Excess" shall mean, with respect to any Interactive Product,
                  the amount, if any, by which the sum of (i) the direct costs
                  deducted hereunder by Franchisor with respect to such
                  Interactive Product, plus (ii) reasonable direct costs
                  incurred by the Franchisee in fulfilling the requirements
                  imposed on the Franchisee by the Franchisor pursuant to
                  Section 3.3 hereof with respect to the Interactive Product,
                  exceeds fifty percent (50%) of Interactive Product Revenues
                  attributable to such Interactive Product.

4.       Relocated TPR Students. Franchisee shall provide test preparation
         services to students who have enrolled with other franchises in
         accordance with the Statement of Inter-Franchise Transfer Policy
         appended hereto as Attachment 1 and herein incorporated by reference.
         This transfer policy may be changed by a 75% Zee Vote.

5.       Advertising Promotion And Public Relations By Franchisor. Franchisor
         may at its option and discretion, for so long as the Franchise
         Agreement remains in effect, fulfill its obligation to develop and
         produce advertising and promotional materials, place advertising, and
         conduct advertising, promotional and public relations programs and
         campaigns by using its own employees. Franchisor shall be entitled to
         receive reimbursement from the Advertising Fund established pursuant to
         the Franchise

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         Agreement for its direct expenses to the extent they are reasonable and
         used for the purposes specified in Section V of the Franchise
         Agreement. Franchisor shall provide to Franchisee, every six months, an
         accounting of reimbursements claimed pursuant to this Paragraph 5.

6.       Expansion of the TPR Method. The definition of the "TPR Method"
         expressly includes without limitation instruction for academic
         subjects, computer usage, languages, negotiation, financial aid, test
         preparation and admissions advice for actual or prospective grade
         school, high school, college, graduate and professional school
         students, and adults, and includes the name and mark STUDENT ACCESS and
         any name confusingly similar thereto. Except as expressly contemplated
         herein, Franchisor and Franchisee each agree and covenant with the
         other that neither of them, nor any of their Affiliates, shall become
         engaged or involved in any business or activity at any time during the
         term of the Franchise Agreement which relates to, involves or is
         competitive with the TPR Method other than (i) any such business or
         activity conducted by Franchisee under the name "The Princeton Review"
         pursuant to, and in accordance with, the terms of the Franchise
         Agreement, (ii) the publishing business to be conducted by The
         Princeton Review Publishing Company, L.L.C. ("PUB"), an Affiliate of
         the Franchisor, and (iii) any such business or activity conducted by
         Franchisor, or an Affiliate of Franchisor, under the name "The
         Princeton Review" in a defined geographical area outside of
         Franchisee's Territory in accordance with the TPR Method and with the
         obligation to pay to the Franchisor royalty-service and advertising
         fees to the same extent and manner as Franchisee. Nothing contained in
         this Paragraph 6 shall be construed to affect or otherwise alter the
         post-termination obligations of Franchisee contained in Section XIV of
         the Franchise Agreement. If Franchisee should ever sell, assign or
         otherwise transfer all of the franchise rights granted under the
         Franchise Agreement in accordance with the provisions thereof, then the
         Franchise Agreement, in accordance with Section XI.B. thereof, shall be
         deemed to have been terminated by mutual consent and the term thereof
         shall be deemed to have expired upon completion of such sale,
         assignment or other transfer, and all obligations of Franchisee under
         Section XIV. thereof shall become effective.

         6.1      In Section VI.B.1.a of the Franchise Agreement, the word "and"
                  appearing after the phrase "circulated generally to all other
                  franchisees" and before the phrase "except as otherwise
                  hereunder" is hereby replaced with the word "or".

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7.       TPR Publishing.

         7.1      Franchisor represents to Franchisee, and Franchisee
                  acknowledges, that pursuant to the provisions of Section 4 of
                  the License Agreement between Franchisor and THE PRINCETON
                  REVIEW PUBLISHING COMPANY, L.L.C. ("PUB"), PUB agreed that
                  "Any product, technique or mark developed or acquired by PUB
                  (a "PUB Product") shall be offered to [Franchisor] for (i)
                  [Franchisor's] own use in the operation of the Course
                  Business, and (ii) use by [Franchisor's] franchisees in
                  accordance with, and subject to, the terms contained in the
                  franchise agreements between [Franchisor] and each of its
                  franchisees." In that connection, the parties agree that
                  Franchisee's use of PUB's products shall be allowed only in
                  accordance with the following provisions:

         (a)      Franchisee shall have the right and license to (i) use PUB's
                  products in The Princeton Review courses offered pursuant to
                  the Franchise Agreement and (ii) purchase from Franchisor or
                  any designee or affiliate of Franchisor or any of PUB's
                  products for such purpose at PUB's incremental cost of
                  production plus 10%, subject to the following limitations and
                  conditions:

                  (1)      None of PUB's products purchased by Franchisee from
                           Franchisor pursuant to this Section 7.1(a) may be
                           resold to any person at any price. Such products may
                           only be distributed to students enrolled in The
                           Princeton Review courses, offered pursuant to the
                           Franchise Agreement, at no additional cost or charge.

                  (2)      The use of any PUB product in any The Princeton
                           Review course must be approved in advance by
                           Franchisor, such approval not to be unreasonably
                           withheld.

                  (3)      The sum of the suggested retail prices of all of the
                           PUB products distributed in any single The Princeton
                           Review course pursuant to the right contained in this
                           Section 7.1(a) shall not exceed 40% of the total cost
                           of such course.

         (b)      In addition to, and without limiting, the rights created in
                  Section 7.1(a) hereof, and subject to the availability of
                  products, Franchisee shall have the right to purchase from
                  Franchisor any of PUB's products at the Applicable Wholesale
                  Price (as herein defined) and resell such products, either
                  alone or together with Franchisor-approved services provided
                  by Franchisee in

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                  Franchisee's Territory. Franchisor's approval is not to be
                  unreasonably withheld.

                  (1)      For purposes of the Franchise Agreement, the revenues
                           attributable to the sale by the Franchisee of any PUB
                           product purchased from the Franchisor shall not be
                           subject to the royalty fee or advertising fee
                           provisions of the Franchise Agreement except to the
                           extent that the price charged for a PUB product
                           exceeds its suggested retail price. All revenues
                           attributable to services sold with any PUB product
                           shall be subject to such royalty and advertising fee
                           payments.

                  (2)      As used herein, the term "Applicable Wholesale Price"
                           shall mean, with respect to any PUB product, the
                           lowest wholesale price charged contemporaneously by
                           PUB for such product to any one of its three largest
                           wholesale customers.

                           (c)      As used herein, references to "PUB's
                                    products" or a "PUB product" shall mean and
                                    refer to (i) for purposes of section 7.1(b)
                                    hereof, any and all materials, supplies and
                                    products of PUB sold at retail which are not
                                    subject to an exclusive distribution
                                    agreement and (ii) for all other purposes of
                                    this Addendum, any and all materials,
                                    supplies and products of PUB which are
                                    offered to the public at retail through any
                                    means.

         7.2      Franchisee shall be provided with all mailing list information
                  maintained by one or both of PUB and Franchisor to the extent
                  that such mailing list contains information about persons
                  within the Franchisee's Territory, and shall have the right to
                  use such information only for the promotion of Franchisee's
                  The Princeton Review business. Franchisee shall not permit the
                  use of such information by any party without the prior,
                  express written consent of Franchisor.

         7.3      Franchisee shall provide PUB and Franchisor with mailing list
                  information it maintains, and PUB and Franchisor shall have
                  the right to sell or rent such information for any business
                  purpose, including any which may not have been permitted under
                  the Franchise Agreement prior to this Addendum, provided that
                  such prior unpermitted purpose is approved by a 75% Zee Vote.

         7.4      If Franchisor has not developed a The Princeton Review course
                  utilizing a PUB product, then Franchisee, following notice to
                  Franchisor, may at its own expense develop such a course ("PUB
                  Course"), and offer it within Franchisee's Territory,

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                  subject to the terms of Subsection 7.1 above in regard to the
                  use of PUB's products in such PUB Course. Any PUB Course shall
                  be subject to Franchisor's approval based on (i) quality
                  standards equivalent to other products available under the TPR
                  Method, (ii) lack of any legal restriction and (iii)
                  suitability of the nature of such PUB Course for inclusion and
                  identification with other courses offered under the TPR Method
                  (considering the expertise and objectives of the Franchisor
                  and the preferences of the consumer market it serves), and
                  subject also to the reimbursement of direct costs to
                  Franchisor, if any. All PUB Courses offered shall be deemed
                  components of the TPR Method subject to all applicable
                  provisions of the Franchise Agreement. As used in this
                  Subsection 7.4, the term "course" means a defined and
                  standardized process of live instruction.

                  (a)      The right created in Section 7.4 hereof to develop
                           and offer a PUB Course in the Franchisee's Territory
                           shall specifically include the right and license to
                           use any trade name, trademark or service mark used in
                           conjunction with the PUB product upon which such PUB
                           Course is based, subject to the advance consent and
                           approvals of the Franchisor and other limitations
                           based on reasonable and prudent trademark usage
                           practices.

                  (b)      Franchisor shall have the right in its sole
                           discretion to incorporate any PUB Course into the TPR
                           Method, as defined in the Franchise Agreement and
                           this Addendum thereto, and offer the course generally
                           to all TPR franchisees without payment of
                           compensation to Franchisee. Upon request, Franchisee
                           shall provide Franchisor with the information and
                           cooperation reasonably necessary to achieve this
                           objective.

8.       Computer Support and Access to Data. The parties agree that the
         computer systems are critical to the efficient and effective operation
         of their respective The Princeton Review business and to proper
         oversight.

         8.1      In the event that an error in The Princeton Review software or
                  data makes it impossible for the Franchisee to manage his
                  course operations, Franchisor shall make its best efforts to
                  provide computer support within 48 hours of receipt of written
                  or electronic mail notice. Understanding that running a TPR
                  franchise often requires heavy computer use on weekends,
                  Franchisor shall attempt to provide computer support on
                  Saturday afternoons (12:00 pm-5:00 pm New York time) during
                  heavy use times.

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         8.2      Within four (4) days of the first and fifteenth of every
                  month, Franchisee shall send to Franchisor on computer tape a
                  copy of data regarding Franchisee's business activities
                  compiled and entered in accordance with the specifications,
                  instructions and computer program provided by Franchisor,
                  which may be reasonably revised from time to time. Such tapes
                  shall be sent by such means as they will usually be received
                  by Franchisor within five (5) days. Franchisor hereby releases
                  Franchisee from claims prior to the date of this Addendum
                  arising from the failure to provide such tapes.

         8.3      The parties acknowledge that it is in the best interest of The
                  Princeton Review for each franchised office to run an
                  up-to-date and compatible software system, including network,
                  word processing, spreadsheet, page layout, electronic mail,
                  and other software deemed both reasonable and necessary by
                  Franchisor to run the franchised business efficiently and
                  effectively. Therefore, Franchisee agrees that any software he
                  uses in the operation of the business shall have been legally
                  acquired by Franchisee, and that Franchisor may require
                  software purchases of up to $200 per full time office employee
                  per year, such amount to be annually adjusted for increases in
                  the Consumer Price Index for all Urban Consumers. Franchisor
                  shall not charge Franchisee for the cost of software supplied
                  by Franchisor that is specific to the administration of the
                  business.

         8.4      If and when Franchisee is connected to the Franchisor's Wide
                  Area Network, Franchisor will provide Franchisee support for
                  all legally-owned, Franchisor-approved network software in a
                  manner similar to the support Franchisor provides for the
                  franchisee operations which Franchisor owns or controls.
                  Franchisor may recover from Franchisee its reasonable
                  proportionate costs for maintaining the connection with
                  Franchisee.

9.       Affiliated Suppliers. If KIN, Inc. or any other Affiliate of Franchisor
         sells materials to any of the other The Princeton Review franchises,
         Franchisor will exercise its authority over such Affiliate to have it
         sell such materials to Franchisee, provided, and on condition that,
         Franchisee is not in default of any obligation to Franchisor or any
         Affiliate under the Franchise or other agreement. A default under any
         obligation which the Franchisee incurs in connection with the purchase
         of materials pursuant to this Section 9 from KIN, Inc. or any other
         Affiliate of Franchisor shall constitute a default under the Franchise
         Agreement.

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10.      Extension of Term of Franchise Agreement. If the remaining portion of
         the initial term of Franchisee's Franchise Agreement with Franchisor is
         a period of ten years or less, it is mutually agreed that, as of the
         expiration of that Agreement, the initial term will be extended until
         December 31, 2005, provided that Franchisee has paid Franchisor a
         renewal fee of $2,500. If the Franchise Agreement does not require
         payment of a renewal fee upon any extension of the term thereof, then
         the $2,500 renewal fee referred to in the immediately preceding
         sentence shall not be payable by Franchisee to Franchisor. The
         provisions of this Paragraph 10 shall not alter, modify or in any other
         way affect any provisions contained in the Franchise Agreement
         concerning other extension or renewal rights in favor of the
         Franchisee.

11.      Favored Nation Clause. Notwithstanding any prior agreement between
         Franchisor and Franchisee, and without incurring any liability or other
         obligation arising therefrom, Franchisor shall have the unlimited right
         to negotiate and enter into Franchise Agreements with any Franchisee
         located outside of the United States which may include any term,
         condition, provision or covenant different from those provided in the
         Franchise Agreement or Agreements with Franchisee.

12.      New Programs. The terms under which Franchisor shall offer a new course
         ("New Course"), other than one designed to prepare students for a
         college or graduate school admission test, shall be governed by the
         following provisions in lieu of the provisions contained in Section
         VI.B.1.c. of the Franchise Agreement.

         12.1     Franchisor shall only offer a New Course to Franchisee (the
                  "New Course Offer") if the New Course has been tested, as that
                  term is defined in the Franchise Agreement, for at least one
                  year. Notwithstanding the preceding sentence, if Franchisor is
                  wholly, or in some material portion, developing the New Course
                  through the making of a purchase of a course that has been
                  operated for at least one year by an unrelated and
                  unaffiliated party ("Development Purchase"), then it will make
                  the New Course Offer as soon as reasonably possible after
                  Franchisor determines that it intends to make such purchase.

         12.2     When it makes a New Course Offer, Franchisor shall provide to
                  Franchisee:

                  (a)      All material information then known by Franchisor
                           relating to (i) such New Course (including historical
                           financial information) and (ii) the terms of any

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                           proposed Development Purchase, including copies or
                           summaries of any legal documents or current drafts of
                           legal documents relating to such purchase. Franchisor
                           may condition the right to receive such information
                           upon the execution of a reasonable non-disclosure
                           agreement. Franchisor shall update such information
                           from time to time as necessary to advise Franchisee
                           of any material changes.

                  (b)      A written proposal ("Franchisor's Allocation
                           Formula") setting forth a specific method or formula
                           for allocating the cost of developing and/or
                           acquiring the New Course.

                  (c)      Franchisee shall have the right to request additional
                           information for a period of fifteen (15) days
                           following receipt of the foregoing information and
                           proposal, and Franchisor shall respond to all such
                           reasonable requests within ten (10) days following
                           receipt thereof.

         12.3     No earlier than 15 days after the close of the period within
                  which Franchisee may request additional information pursuant
                  to Section 12.2 hereof, Franchisor shall conduct a Zee Vote to
                  determine if the Franchisor's Allocation Formula is acceptable
                  to the franchisees in the Domestic Franchisee Group.

         12.4     If Franchisor's Allocation Formula is approved by a 75% Zee
                  Vote, then it shall be, for all purposes hereof, the Adopted
                  Allocation Formula binding on all franchises in the Domestic
                  Franchisee Group. If (i) Franchisor's Allocation Formula is
                  not approved by a 75% Zee Vote and (ii) Franchisor wishes to
                  continue to pursue the New Course Offer, then Franchisor may
                  provide written notice ("Arbitration Notice") to all
                  franchisees in the Domestic Franchisee Group that the
                  selection of an Adopted Allocation Formula is being submitted
                  for resolution by arbitration. Concurrently, Franchisor shall
                  file a Demand for Arbitration with the appropriate office of
                  the American Arbitration Association. The arbitration shall be
                  conducted in accordance with the following provisions:

                  (a)      A single arbitrator shall be chosen by mutual
                           agreement between the Franchisor and the Independent
                           Franchisees. If no such mutual agreement is reached
                           within five days, then the arbitrator shall be
                           selected in accordance with the commercial expedited
                           arbitration rules of the American Arbitration
                           Association ("AAA"). For purposes of these
                           provisions, any decision or selection made by any
                           group of Independent Franchisees who, in the

                                       12
<PAGE>   13
                           aggregate, pay more than 50% of the total royalties
                           received by Franchisor from Independent Franchisees
                           in the most recently completed calendar year, shall
                           be binding on all of the Independent Franchisees. The
                           arbitration proceedings shall be conducted in
                           Atlanta, GA.

                  (b)      Franchisor shall submit to the arbitrator a copy of
                           Franchisor's Allocation Formula, and any written
                           memorandum in support thereof, within 21 days after
                           giving the Arbitration Notice to Franchisees.

                  (c)      Any franchisee, excluding those which are Affiliates
                           of Franchisor, may submit to the arbitrator an
                           alternative allocation formula that is materially
                           different from Franchisor's Allocation Formula
                           ("Alternative Formula") within 20 days after receipt
                           of the Arbitration Notice. If Franchisor has
                           submitted original data that it did not supply to
                           Franchisee under Section 12.2, then Franchisee may
                           submit its Alternative Formula within 5 days after
                           receipt of Franchisor's memorandum submitted pursuant
                           to clause b.

                  (d)      All formulas submitted pursuant to Subsections
                           13.3(b) and (c) may be accompanied by a written
                           memorandum and exhibits, copies of which shall be
                           provided to all other participating parties.

                  (e)      Within 14 days after the last date by which
                           Franchisee may submit an Alternative Formula pursuant
                           to clause (c), Franchisor and those franchisees which
                           have submitted Alternative Formulas shall meet with
                           the arbitrator to present oral arguments in favor of
                           their respective proposals. The arbitrator shall
                           select one allocation formula, from among the
                           Franchisor's Allocation Formula and the Alternative
                           Formulas, without modification, based upon principles
                           of fairness, equity and sound business practices. The
                           formula so selected by the arbitrator shall be, for
                           all purposes hereof, the Adopted Allocation Formula
                           binding on Franchisor and all Franchisees in the
                           Domestic Franchisee Group. The arbitrator's decision
                           shall be final. In any event, Franchisor may elect to
                           postpone or cancel any Development Purchase.

                  (f)      The fees and costs of filing such arbitration and the
                           fees of the arbitrator shall be split between the
                           parties to the arbitration as follows: (i) Franchisor
                           shall pay 40% of such fees; and (ii) all parties
                           (including Franchisor) who submit allocation formulas
                           to the arbitrator pursuant to this Section but whose
                           formulas are not selected shall pay the remainder on
                           a per-capita

                                       13
<PAGE>   14

                           basis. All other expenses and costs related to such
                           proceeding shall be borne by the party incurring
                           them.

         12.5     Following the final determination of the Adopted Allocation
                  Formula, Franchisor shall give Franchisee a notice ("Offer
                  Notice") extending to Franchisee the exclusive option to
                  market and sell the New Course in the Franchisee's Territory
                  pursuant to the Franchise Agreement and on condition of
                  compliance with Franchisee's obligations under the terms of
                  the Adopted Allocation Formula. If Franchisee does not notify
                  Franchisor of its decision to exercise such option within 20
                  days after receipt of the Offer Notice, Franchisor may grant
                  the right to market and sell the New Course in Franchisee's
                  Territory to any other party or parties, but only under a name
                  or mark other than THE PRINCETON REVIEW, any other proprietary
                  name or mark currently or formerly licensed to Franchisee by
                  Franchisor, or any other name or mark that is confusingly
                  similar to the foregoing.

         12.6     The formulas presented under Subsections 12.4(b) and (c)
                  should be prepared in accordance with prudent business
                  practices and devote attention and discussion to, among
                  others, the following considerations:

                  (a)      Only the portion of the Franchisor's total cost of
                           development attributable to courses that may be run
                           by franchisees (the "Course Price") shall be
                           allocated for reimbursement by the franchisees.
                           Franchisor's total cost of development may include
                           acquisition costs, imputed or actual interest, and,
                           in the event that the form of the reimbursement is in
                           a different form than Franchisor's payment of costs,
                           a factor that accounts for such differential.

                  (b)      The Course Price should be divided into the amount
                           fairly paid to acquire revenues currently realized
                           from existing sales of the course ("Existing Sales")
                           and any amount fairly paid in anticipation of
                           potential future revenues reasonably projected
                           ("Future Sales").

                  (c)      The Existing Sales portion of the Course Price should
                           be allocated among franchisees according to the
                           proportion of such sales currently made in their
                           respective Territories. Some part of the Existing
                           Sales portion of the Course Price also may be
                           allocable to the Franchisor to the extent that
                           imputed royalties from such sales exceed the fair
                           value or cost of services to be provided by
                           Franchisor.

                                       14
<PAGE>   15

                  (d)      The Future Sales portion of the Course Price should
                           be allocated among the then-existing franchisees
                           according to the proportion of a reasonable measure
                           of the potential sales anticipated in their
                           respective Territories.

13.      Grouping and Subdividing. Notwithstanding anything to the contrary
         contained in the Franchise Agreement, if (i) Franchisee or an Affiliate
         of that Franchisee should now or hereafter be a licensed The Princeton
         Review franchisee under one or more other Franchise Agreements ("Other
         Franchise Agreements") with Franchisor covering other Territories, and
         (ii) Franchisee and its Affiliates propose to sell, assign, or transfer
         all or any portion of their rights under the Franchise Agreement and
         the Other Franchise Agreement in a single transaction that has a single
         purchase price and does not include any non franchise-related assets,
         then the following provisions shall apply:

         13.1     The provision of Section XI.B of the Franchise Agreement
                  relating to the Franchisor's first right and option to acquire
                  such right or interest shall apply to the entire transaction
                  only.

         13.2     Franchisor shall have no right to require that the portion of
                  such transaction which relate to Franchisee's rights or
                  interests under the Franchise Agreement be separated out of
                  the transaction with a separate purchase price allocated
                  thereto for purposes of Section XI.B. of the Franchise
                  Agreement.

         13.3     Nothing contained in this Section 13 shall be deemed to be a
                  waiver or relinquishment of Franchisor's right to enforce and
                  receive separate transfer fee payments due under each
                  individual Franchise Agreement applicable to each separate
                  franchise being sold or transferred.

         IN WITNESS WHEREOF, the parties have executed this Addendum along with
two Attachment intended thereby to be legally bound. THE PRINCETON REVIEW
MANAGEMENT CORP.

                                         By:  /s/ John Katzman
                                              ----------------------------------
                                         Name: John Katzman
                                               ---------------------------------
                                         Title: President
                                                --------------------------------
WITNESS/ATTEST

____________________________

                                       15
<PAGE>   16
                               FRANCHISEE JOINDER
                                   TO ADDENDUM

By executing in the space provided below, the Person identified below
acknowledges having received and read, and agrees to become a party to, and be
bound by, the Addendum to Franchise Agreement dated effective as of May 31, 1995
which amends and modifies the Franchise Agreement with The Princeton Review
Management Corp. described below.

DESCRIPTION OF FRANCHISE AGREEMENT:

Date of Franchise Agreement: July 15, 1987.

Name of Franchisee(s): Charles F. Emmons & Charles F. Emmons, Jr., Jointly.
                       ----------------------------------------------------

Geographical Area of Franchise Agreement: Western Mass.
                                          --------------

                                  Signature of Franchisee(s) or Authorized
                                  Officer of Franchisee(s):

                                  /s/ Charles F. Emmons/ Charles F. Emmons, Jr.
                                  ---------------------------------------------

                                  Printed Name of Officer (if applicable):

                                  Charles F. Emmons & Charles F. Emmons, Jr.
                                  ------------------------------------------

                                  Address for Notice:

                                      P.O. Box 390
                                      ------------
                                      Florence, MA 01060
                                      ------------------

                                      ------------------

                                       16
<PAGE>   17
                               FRANCHISEE JOINDER
                                   TO ADDENDUM

By executing in the space provided below, the Person identified below
acknowledges having received and read, and agrees to become a party to, and be
bound by, the Addendum to Franchise Agreement dated effective as of May 31, 1995
which amends and modifies the Franchise Agreement with The Princeton Review
Management Corp. described below.

DESCRIPTION OF FRANCHISE AGREEMENT:

Date of Franchise Agreement: September 1985.

Name of Franchisee(s): The Princeton Review of Orange County, Inc.
                       -------------------------------------------

Geographical Area of Franchise Agreement: Orange County, CA.
                                          -----------------

                                    Signature of Franchisee(s) or Authorized
                                    Officer of Franchisee(s):

                                    /s/ Paul Kanarek
                                    ----------------

                                    Printed Name of Officer (if applicable):

                                    Paul Kanarek
                                    ------------

                                    Address for Notice:

                                        2151 Michelson Dr. # 280
                                        ------------------------

                                        Irvine, CA 92715
                                        ----------------

                                        ----------------

                                       17
<PAGE>   18
                               FRANCHISEE JOINDER
                                   TO ADDENDUM

By executing in the space provided below, the Person identified below
acknowledges having received and read, and agrees to become a party to, and be
bound by, the Addendum to Franchise Agreement dated effective as of May 31, 1995
which amends and modifies the Franchise Agreement with The Princeton Review
Management Corp. described below.

DESCRIPTION OF FRANCHISE AGREEMENT:

Date of Franchise Agreement: June 1986.

Name of Franchisee(s): Princeton Review of Boston, Inc.
                       --------------------------------

Geographical Area of Franchise Agreement: 10 eastern counties of Mass.
                                          ----------------------------

                                    Signature of Franchisee(s) or Authorized
                                    Officer of Franchisee(s):

                                    /s/ Matthew Rosenthal
                                    ---------------------

                                    Printed Name of Officer (if applicable):

                                    Matthew Rosenthal
                                    ------------------

                                    Address for Notice:

                                       57 Union Street, # 1
                                       ---------------------
                                       Newton, MA 02159
                                       ----------------

                                       ----------------

                                       18
<PAGE>   19
                               FRANCHISEE JOINDER
                                   TO ADDENDUM

By executing in the space provided below, the Person identified below
acknowledges having received and read, and agrees to become a party to, and be
bound by, the Addendum to Franchise Agreement dated effective as of May 31, 1995
which amends and modifies the Franchise Agreement with The Princeton Review
Management Corp. described below.

DESCRIPTION OF FRANCHISE AGREEMENT:

Date of Franchise Agreement: 5/31/95.
                             --------

Name of Franchisee(s): Patricia Krebs.
                       ---------------

Geographical Area of Franchise Agreement: Wake, Orange, Durham, Guildford and
Forsythe counties - NC.

                                    Signature of Franchisee(s) or Authorized
                                    Officer of Franchisee(s):

                                    /s/ Patricia Krebs
                                    ------------------

                                    Printed Name of Officer (if applicable):

                                    Patricia Krebs
                                    ---------------

                                    Address for Notice:

                                        1829 E. Franklin St., # 600
                                        ---------------------------

                                        Chapel Hill, NC 27514
                                        ---------------------

                                        ---------------------

                                       19
<PAGE>   20
                               FRANCHISEE JOINDER
                                   TO ADDENDUM

By executing in the space provided below, the Person identified below
acknowledges having received and read, and agrees to become a party to, and be
bound by, the Addendum to Franchise Agreement dated effective as of May 31, 1995
which amends and modifies the Franchise Agreement with The Princeton Review
Management Corp. described below.

DESCRIPTION OF FRANCHISE AGREEMENT:

Date of Franchise Agreement: 5/31/95.
                             -------

Name of Franchisee(s): Eric B. Moore.
                       -------------

Geographical Area of Franchise Agreement: Mecklenburg County, NC.
                                          -----------------------

                                    Signature of Franchisee(s) or Authorized
                                    Officer of Franchisee(s):

                                    /s/ Eric B. Moore
                                    -----------------

                                    Printed Name of Officer (if applicable):

                                    Eric B. Moore
                                    --------------

                                    Address for Notice:

                                        1206 Providence Road
                                        --------------------

                                        Charlotte, NC 28207
                                        -------------------

                                        -------------------

                                       20
<PAGE>   21
                               FRANCHISEE JOINDER
                                   TO ADDENDUM

By executing in the space provided below, the Person identified below
acknowledges having received and read, and agrees to become a party to, and be
bound by, the Addendum to Franchise Agreement dated effective as of May 31, 1995
which amends and modifies the Franchise Agreement with The Princeton Review
Management Corp. described below.

DESCRIPTION OF FRANCHISE AGREEMENT:

Date of Franchise Agreement: February 1990.

Name of Franchisee(s): Test Services, Inc., Cleveland.
                       ------------------------------

Geographical Area of Franchise Agreement: Ashland, Cuyahoga, Knox and
Medina counties in the State of Ohio.

                                    Signature of Franchisee(s) or Authorized
                                    Officer of Franchisee(s):

                                    /s/ Michael A. Bjornstad
                                    ------------------------

                                    Printed Name of Officer (if applicable):

                                    Michael A. Bjornstad
                                    --------------------

                                    Address for Notice:

                                        7350 North Broadway
                                        -------------------

                                        Denver, CO 80221
                                        ----------------

                                        ----------------

                                       21
<PAGE>   22
                               FRANCHISEE JOINDER
                                   TO ADDENDUM

By executing in the space provided below, the Person identified below
acknowledges having received and read, and agrees to become a party to, and be
bound by, the Addendum to Franchise Agreement dated effective as of May 31, 1995
which amends and modifies the Franchise Agreement with The Princeton Review
Management Corp. described below.

DESCRIPTION OF FRANCHISE AGREEMENT:

Date of Franchise Agreement: February 1998.

Name of Franchisee(s): Test Services, Inc. - Denver.
                       ----------------------------

Geographical Area of Franchise Agreement: Adams, Arapahoe, Boulder, Denver,
Douglas, El Paso, Jefferson and Larimer counties in the State of Colorado.

                                    Signature of Franchisee(s) or Authorized
                                    Officer of Franchisee(s):

                                    /s/ Michael A. Bjornstad
                                    ------------------------

                                    Printed Name of Officer (if applicable):

                                    Michael A. Bjornstad
                                    --------------------

                                    Address for Notice:

                                        7350 North Broadway
                                        -------------------

                                        Denver, CO 80221
                                        ----------------

                                        ----------------

                                       22
<PAGE>   23
                               FRANCHISEE JOINDER
                                   TO ADDENDUM

By executing in the space provided below, the Person identified below
acknowledges having received and read, and agrees to become a party to, and be
bound by, the Addendum to Franchise Agreement dated effective as of May 31, 1995
which amends and modifies the Franchise Agreement with The Princeton Review
Management Corp. described below.

DESCRIPTION OF FRANCHISE AGREEMENT:

Date of Franchise Agreement: February 1989.

Name of Franchisee(s): Test Services, Inc. - Detroit.
                       ------------------------------

Geographical Area of Franchise Agreement: Oakland, Washtenaw, Wayne, and Ingham
counties in State of Michigan.

                                    Signature of Franchisee(s) or Authorized
                                    Officer of Franchisee(s):

                                    /s/ Michael A. Bjornstad
                                    ------------------------

                                    Printed Name of Officer (if applicable):

                                    Michael A. Bjornstad
                                    --------------------

                                    Address for Notice:

                                        7350 North Broadway
                                        -------------------

                                        Denver, CO 80221
                                        ----------------

                                        ----------------

                                       23
<PAGE>   24
                               FRANCHISEE JOINDER
                                   TO ADDENDUM

By executing in the space provided below, the Person identified below
acknowledges having received and read, and agrees to become a party to, and be
bound by, the Addendum to Franchise Agreement dated effective as of May 31, 1995
which amends and modifies the Franchise Agreement with The Princeton Review
Management Corp. described below.

DESCRIPTION OF FRANCHISE AGREEMENT:

Date of Franchise Agreement: May 1986.

Name of Franchisee(s): Test Servces, Inc. - Connecticut.
                       --------------------------------

Geographical Area of Franchise Agreement: Fairfield, Litchfield, New haven, New
London counties in the Connecticut.

                                    Signature of Franchisee(s) or Authorized
                                    Officer of Franchisee(s):

                                    /s/ Michael A. Bjornstad
                                    ------------------------

                                    Printed Name of Officer (if applicable):

                                    Michael A. Bjornstad
                                    ---------------------

                                    Address for Notice:

                                        7350 North Broadway
                                        -------------------

                                        Denver, CO 80221
                                        ----------------

                                        ----------------

                                       24
<PAGE>   25
                               FRANCHISEE JOINDER
                                   TO ADDENDUM

By executing in the space provided below, the Person identified below
acknowledges having received and read, and agrees to become a party to, and be
bound by, the Addendum to Franchise Agreement dated effective as of May 31, 1995
which amends and modifies the Franchise Agreement with The Princeton Review
Management Corp. described below.

DESCRIPTION OF FRANCHISE AGREEMENT:

Date of Franchise Agreement: May 1990.

Name of Franchisee(s): Test Services, Inc. - North Florida.
                       -----------------------------------

Geographical Area of Franchise Agreement: Orange, Seminole, Lake, Osceola,
Volusia, Leon, Gadsen, Liberty, Wakulla, Jefferson, Duval, Nassau, Baker,
Bradford, Clay, St. Johns, Alachua counties in the State of
Florida.

                                    Signature of Franchisee(s) or Authorized
                                    Officer of Franchisee(s):

                                    /s/ Michael A. Bjornstad
                                    ------------------------

                                    Printed Name of Officer (if applicable):

                                    Michael A. Bjornstad
                                    --------------------

                                    Address for Notice:

                                        7350 North Broadway
                                        -------------------

                                        Denver, CO 80221
                                        ----------------

                                        ----------------

                                       25
<PAGE>   26
                               FRANCHISEE JOINDER
                                   TO ADDENDUM

By executing in the space provided below, the Person identified below
acknowledges having received and read, and agrees to become a party to, and be
bound by, the Addendum to Franchise Agreement dated effective as of May 31, 1995
which amends and modifies the Franchise Agreement with The Princeton Review
Management Corp. described below.

DESCRIPTION OF FRANCHISE AGREEMENT:

Date of Franchise Agreement: 5/11/95.
                             -------

Name of Franchisee(s): Lecomp Co, Inc./LEC.

Geographical Area of Franchise Agreement: Sourthern California.
                                          --------------------

                                    Signature of Franchisee(s) or Authorized
                                    Officer of Franchisee(s):

                                    /s/ Lloyd Eric Cotsen
                                    ---------------------

                                    Printed Name of Officer (if applicable):

                                    Lloyd Eric Cotsen
                                    -----------------

                                    Address for Notice:

                                         1880 Veteran Avenue (#310)
                                         --------------------------

                                         Los Angeles, CA 90025
                                         ---------------------

                                         ---------------------

                                       26
<PAGE>   27
                               FRANCHISEE JOINDER
                                   TO ADDENDUM

By executing in the space provided below, the Person identified below
acknowledges having received and read, and agrees to become a party to, and be
bound by, the Addendum to Franchise Agreement dated effective as of May 31, 1995
which amends and modifies the Franchise Agreement with The Princeton Review
Management Corp. described below.

DESCRIPTION OF FRANCHISE AGREEMENT:

Date of Franchise Agreement: May 1986.
                             --------

Name of Franchisee(s): Test Services, Inc. -  South Florida.
                       -------------------------------------

Geographical Area of Franchise Agreement: Broward, Dade, De Soto, Hardee,
Hillsborough, Manatee, Palm Beach, Pasco, Pinellas, Polk, Sarasota counties in
the State of Florida.

                                    Signature of Franchisee(s) or Authorized
                                    Officer of Franchisee(s):

                                    /s/ Michael A. Bjornstad
                                    -----------------------

                                    Printed Name of Officer (if applicable):

                                    Michael A, Bjornstad
                                    --------------------

                                    Address for Notice:

                                         7350 N. Broadway
                                         ----------------

                                         Denver, CO 80221
                                         ----------------

                                         ----------------

                                       27
<PAGE>   28
                               FRANCHISEE JOINDER
                                   TO ADDENDUM

By executing in the space provided below, the Person identified below
acknowledges having received and read, and agrees to become a party to, and be
bound by, the Addendum to Franchise Agreement dated effective as of May 31, 1995
which amends and modifies the Franchise Agreement with The Princeton Review
Management Corp. described below.

DESCRIPTION OF FRANCHISE AGREEMENT:

Date of Franchise Agreement:
                            --------------------------------------------------
Name of Franchisee(s): The Princeton Review of NH and Maine.

Geographical Area of Franchise Agreement: States of New Hampshire and Maine.

                                    Signature of Franchisee(s) or Authorized
                                    Officer of Franchisee(s):

                                    /s/ Matthew Rosenthal
                                    ---------------------

                                    Printed Name of Officer (if applicable):

                                    Matthew Rosenthal
                                    -----------------

                                    Address for Notice:

                                        57 Union Street, # 1
                                        --------------------

                                        Newton, MA 02159
                                        ----------------

                                        ----------------

                                       28
<PAGE>   29
                               FRANCHISEE JOINDER
                                   TO ADDENDUM

By executing in the space provided below, the Person identified below
acknowledges having received and read, and agrees to become a party to, and be
bound by, the Addendum to Franchise Agreement dated effective as of May 31, 1995
which amends and modifies the Franchise Agreement with The Princeton Review
Management Corp. described below.

DESCRIPTION OF FRANCHISE AGREEMENT:

Date of Franchise Agreement: June 1986.

Name of Franchisee(s): The Princeton Review of New Jersey, Inc.
                       ----------------------------------------

Geographical Area of Franchise Agreement: Certain counties in the State of New
Jersey (north of Mercer County).

                                    Signature of Franchisee(s) or Authorized
                                    Officer of Franchisee(s):

                                    /s/ Robert Cohen
                                    ----------------

                                    Printed Name of Officer (if applicable):

                                    Robert Cohen
                                    ------------

                                    Address for Notice:

                                        252 Nassau St.
                                        --------------

                                        Princeton, NJ 08642
                                        -------------------

                                        -------------------

                                       29
<PAGE>   30
                               FRANCHISEE JOINDER
                                   TO ADDENDUM

By executing in the space provided below, the Person identified below
acknowledges having received and read, and agrees to become a party to, and be
bound by, the Addendum to Franchise Agreement dated effective as of May 31, 1995
which amends and modifies the Franchise Agreement with The Princeton Review
Management Corp. described below.

DESCRIPTION OF FRANCHISE AGREEMENT:

Date of Franchise Agreement: 7/1/88.
                             ------

Name of Franchisee(s): T.S. T.S., Inc.
                       ---------------

Geographical Area of Franchise Agreement: Originally Jefferson and Orleans
county, New Orleans, Louisiana, amended to the entire State of Louisiana and
Dona Ana county in the State of New Mexico.

                                    Signature of Franchisee(s) or Authorized
                                    Officer of Franchisee(s):

                                    /s/ Rob Case/ Kevin Campbell
                                    ----------------------------

                                    Printed Name of Officer (if applicable):

                                    Rob Case/ Kevin Campbell
                                    ------------------------

                                    Address for Notice:

                                    701 N. Post Oak Rd., # 8
                                    ------------------------

                                    Houston, TX 77024
                                    -----------------

                                    -----------------

                                       30
<PAGE>   31
                               FRANCHISEE JOINDER
                                   TO ADDENDUM

By executing in the space provided below, the Person identified below
acknowledges having received and read, and agrees to become a party to, and be
bound by, the Addendum to Franchise Agreement dated effective as of May 31, 1995
which amends and modifies the Franchise Agreement with The Princeton Review
Management Corp. described below.

DESCRIPTION OF FRANCHISE AGREEMENT:

Date of Franchise Agreement: 12/1/94
                             -------

Name of Franchisee(s): T.S. T.S., Inc.
                       ---------------

Geographical Area of Franchise Agreement: State of Oklahoma.
                                          -----------------

                                    Signature of Franchisee(s) or Authorized
                                    Officer of Franchisee(s):

                                    /s/ Rob Case/ Kevin Campbell
                                    ----------------------------

                                    Printed Name of Officer (if applicable):

                                    Rob Case/ Kevin Campbell
                                    ------------------------

                                    Address for Notice:

                                         701 N. Oak Post Rd., # 8
                                         ------------------------

                                         Houston, TX 77024
                                         -----------------

                                         -----------------

                                       31
<PAGE>   32
                               FRANCHISEE JOINDER
                                   TO ADDENDUM

By executing in the space provided below, the Person identified below
acknowledges having received and read, and agrees to become a party to, and be
bound by, the Addendum to Franchise Agreement dated effective as of May 31, 1995
which amends and modifies the Franchise Agreement with The Princeton Review
Management Corp. described below.

DESCRIPTION OF FRANCHISE AGREEMENT:

Date of Franchise Agreement: 7/1/87.
                             ------

Name of Franchisee(s): T.S.T.S., Inc.
                       --------------

Geographical Area of Franchise Agreement: State of Arizona.
                                          ----------------

                                    Signature of Franchisee(s) or Authorized
                                    Officer of Franchisee(s):

                                    /s/ Rob Case/ Kevin Campbell
                                    ----------------------------

                                    Printed Name of Officer (if applicable):

                                    Rob Case/ Kevin Campbell
                                    ------------------------

                                    Address for Notice:

                                         701 N. Oak Post Rd., # 8
                                         ------------------------

                                         Houston, TX 77024
                                         -----------------

                                         -----------------

                                       32
<PAGE>   33
                               FRANCHISEE JOINDER
                                   TO ADDENDUM

By executing in the space provided below, the Person identified below
acknowledges having received and read, and agrees to become a party to, and be
bound by, the Addendum to Franchise Agreement dated effective as of May 31, 1995
which amends and modifies the Franchise Agreement with The Princeton Review
Management Corp. described below.

DESCRIPTION OF FRANCHISE AGREEMENT:

Date of Franchise Agreement: June 1986.

Name of Franchisee(s): The Princeton Review of Pittsburgh, Inc.
                       ----------------------------------------

Geographical Area of Franchise Agreement: Western PA.

                                    Signature of Franchisee(s) or Authorized
                                    Officer of Franchisee(s):

                                    /s/ Audrey Olmer
                                    ----------------

                                    Printed Name of Officer (if applicable):

                                    Audrey Olmer
                                    ------------

                                    Address for Notice:

                                         P.O.Box 81123
                                         -------------

                                         Pittsburgh, PA 15217
                                         --------------------

                                         --------------------

                                       33
<PAGE>   34
                               FRANCHISEE JOINDER
                                   TO ADDENDUM

By executing in the space provided below, the Person identified below
acknowledges having received and read, and agrees to become a party to, and be
bound by, the Addendum to Franchise Agreement dated effective as of May 31, 1995
which amends and modifies the Franchise Agreement with The Princeton Review
Management Corp. described below.

DESCRIPTION OF FRANCHISE AGREEMENT:

Date of Franchise Agreement: June 6, 1995.

Name of Franchisee(s): TPR Puerto Rico/ Karen Kearns.
                       -----------------------------

Geographical Area of Franchise Agreement: Puerto Rico.
                                          -----------

                                    Signature of Franchisee(s) or Authorized
                                    Officer of Franchisee(s):

                                    /s/ Karen Kearns
                                    ----------------

                                    Printed Name of Officer (if applicable):

                                    Karen Kearns
                                    ------------

                                    Address for Notice:

                                         11 Pacific Pl.
                                         --------------

                                         Santuree, P.R. 00911
                                         --------------------

                                         --------------------

                                       34
<PAGE>   35
                               FRANCHISEE JOINDER
                                   TO ADDENDUM

By executing in the space provided below, the Person identified below
acknowledges having received and read, and agrees to become a party to, and be
bound by, the Addendum to Franchise Agreement dated effective as of May 31, 1995
which amends and modifies the Franchise Agreement with The Princeton Review
Management Corp. described below.

DESCRIPTION OF FRANCHISE AGREEMENT:

Date of Franchise Agreement: 1/87.
                             ----

Name of Franchisee(s): The Princeton Review of RI, Inc.

Geographical Area of Franchise Agreement: Rhode Island.
                                          ------------

                                    Signature of Franchisee(s) or Authorized
                                    Officer of Franchisee(s):

                                    /s/ Paul M. Stouber
                                    -------------------

                                    Printed Name of Officer (if applicable):

                                    Paul M. Stouber
                                    ---------------

                                    Address for Notice:

                                         125 Thayer St.
                                         --------------

                                         Providence, RI 02906
                                         --------------------

                                         --------------------

                                       35
<PAGE>   36
                               FRANCHISEE JOINDER
                                   TO ADDENDUM

By executing in the space provided below, the Person identified below
acknowledges having received and read, and agrees to become a party to, and be
bound by, the Addendum to Franchise Agreement dated effective as of May 31, 1995
which amends and modifies the Franchise Agreement with The Princeton Review
Management Corp. described below.

DESCRIPTION OF FRANCHISE AGREEMENT:

Date of Franchise Agreement: June 1, 1986.

Name of Franchisee(s): The Princeton Review of St. Louis, Inc.
                       ---------------------------------------

Geographical Area of Franchise Agreement: Missouri County and City of St. Louis.
                                          -------------------------------------

                                    Signature of Franchisee(s) or Authorized
                                    Officer of Franchisee(s):

                                    /s/ William Lindsley
                                    --------------------

                                    Printed Name of Officer (if applicable):

                                    William Lindsley
                                    ----------------

                                    Address for Notice:

                                         9666 Olive Boulevard, Suite 140
                                         -------------------------------

                                         St. Louis, Missouri 63132-3019
                                         ------------------------------

                                         ------------------------------

                                       36
<PAGE>   37
                               FRANCHISEE JOINDER
                                   TO ADDENDUM

By executing in the space provided below, the Person identified below
acknowledges having received and read, and agrees to become a party to, and be
bound by, the Addendum to Franchise Agreement dated effective as of May 31, 1995
which amends and modifies the Franchise Agreement with The Princeton Review
Management Corp. described below.

DESCRIPTION OF FRANCHISE AGREEMENT:

Date of Franchise Agreement: June 1989.

Name of Franchisee(s): Test Services, Inc. - San Diego.
                       -------------------------------

Geographical Area of Franchise Agreement: San Diego county in the State of
California.

                                    Signature of Franchisee(s) or Authorized
                                    Officer of Franchisee(s):

                                    /s/ Michael A. Bjornstad
                                    ------------------------

                                    Printed Name of Officer (if applicable):

                                    Michael A. Bjornstad
                                    --------------------

                                    Address for Notice:
                                         7350 N. Broadway
                                         ----------------
                                         Denver, CO 80221
                                         ----------------
                                         ----------------

                                       37
<PAGE>   38
                               FRANCHISEE JOINDER
                                   TO ADDENDUM

By executing in the space provided below, the Person identified below
acknowledges having received and read, and agrees to become a party to, and be
bound by, the Addendum to Franchise Agreement dated effective as of May 31, 1995
which amends and modifies the Franchise Agreement with The Princeton Review
Management Corp. described below.

DESCRIPTION OF FRANCHISE AGREEMENT:

Date of Franchise Agreement: September 1985.

Name of Franchisee(s): The Princeton Review - Peninsula, Inc.
                       --------------------------------------

Geographical Area of Franchise Agreement: San Mateo and Santa Clara counties
(California).

                                    Signature of Franchisee(s) or Authorized
                                    Officer of Franchisee(s):

                                    /s/ Pamela N. Hirsch
                                    --------------------

                                    Printed Name of Officer (if applicable):

                                    Pamela N. Hirsch
                                    ----------------

                                    Address for Notice:

                                         6489 Camden Ave., # 106
                                         -----------------------

                                         San Jose, CA 95120
                                         ------------------

                                         ------------------

                                       38
<PAGE>   39
                               FRANCHISEE JOINDER
                                   TO ADDENDUM

By executing in the space provided below, the Person identified below
acknowledges having received and read, and agrees to become a party to, and be
bound by, the Addendum to Franchise Agreement dated effective as of May 31, 1995
which amends and modifies the Franchise Agreement with The Princeton Review
Management Corp. described below.

DESCRIPTION OF FRANCHISE AGREEMENT:

Date of Franchise Agreement: May 21, 1995.

Name of Franchisee(s): The Kafiristan Blokes.
                       ---------------------

Geographical Area of Franchise Agreement: Tennessee
                                          ---------

                                    Signature of Franchisee(s) or Authorized
                                    Officer of Franchisee(s):

                                    /s/ F. Wade McKinney/Stephen A. Leake
                                    -------------------------------------

                                    Printed Name of Officer (if applicable):

                                    F. Wade McKinney/Stephen A. Leake
                                    ---------------------------------

                                    Address for Notice:

                                         The Princeton Review
                                         --------------------

                                         3508 Belmont Blvd.
                                         ------------------

                                         Nashville, TN 37215
                                         -------------------

                                       39
<PAGE>   40
                               FRANCHISEE JOINDER
                                   TO ADDENDUM

By executing in the space provided below, the Person identified below
acknowledges having received and read, and agrees to become a party to, and be
bound by, the Addendum to Franchise Agreement dated effective as of May 31, 1995
which amends and modifies the Franchise Agreement with The Princeton Review
Management Corp. described below.

DESCRIPTION OF FRANCHISE AGREEMENT:

Date of Franchise Agreement: Sept. 15, 1986.
                             --------------

Name of Franchisee(s): T.S.T.S., Inc.
                       --------------

Geographical Area of Franchise Agreement: All counties in Texas.

                                    Signature of Franchisee(s) or Authorized
                                    Officer of Franchisee(s):

                                    /s/ Rob Case/ Kevin Campbell
                                    ----------------------------

                                    Printed Name of Officer (if applicable):

                                    Rob Case/ Kevin Campbell
                                    ------------------------

                                    Address for Notice:

                                         701 N. Oak Post Rd., # 8
                                         ------------------------

                                         Houston, TX 70024
                                         -----------------

                                         -----------------

                                       40
<PAGE>   41
                               FRANCHISEE JOINDER
                                   TO ADDENDUM

By executing in the space provided below, the Person identified below
acknowledges having received and read, and agrees to become a party to, and be
bound by, the Addendum to Franchise Agreement dated effective as of May 31, 1995
which amends and modifies the Franchise Agreement with The Princeton Review
Management Corp. described below.

DESCRIPTION OF FRANCHISE AGREEMENT:

Date of Franchise Agreement: 5/31/95.
                             -------

Name of Franchisee(s): Elyane Harney (Utah).
                       --------------------

Geographical Area of Franchise Agreement: State of Utah .
                                          --------------

                                    Signature of Franchisee(s) or Authorized
                                    Officer of Franchisee(s):

                                    /s/ Elyane Harney
                                    -----------------

                                    Printed Name of Officer (if applicable):

                                    Elyane Harney
                                    -------------

                                    Address for Notice:
                                         The Princeton Review
                                         --------------------
                                         8 E. Broadway, Suite 212
                                         ------------------------
                                         Salt Lake City, UT 84111
                                         ------------------------

                                       41
<PAGE>   42
                               FRANCHISEE JOINDER
                                   TO ADDENDUM

By executing in the space provided below, the Person identified below
acknowledges having received and read, and agrees to become a party to, and be
bound by, the Addendum to Franchise Agreement dated effective as of May 31, 1995
which amends and modifies the Franchise Agreement with The Princeton Review
Management Corp. described below.

DESCRIPTION OF FRANCHISE AGREEMENT:

Date of Franchise Agreement: September 1986.

Name of Franchisee(s): Test Services, Inc. - Westchester.
                       ---------------------------------

Geographical Area of Franchise Agreement: Dutchess, Putnam, Rockland, Ulster,
Westchester counties in New York.

                                    Signature of Franchisee(s) or Authorized
                                    Officer of Franchisee(s):

                                    /s/ Michael A. Bjornstad
                                    ------------------------

                                    Printed Name of Officer (if applicable):

                                    Michael A. Bjornstad
                                    ---------------------

                                    Address for Notice:

                                         7350 N. Broadway
                                         ----------------

                                         Denver, CO 80221
                                         ----------------

                                         ----------------

                                       42
<PAGE>   43
                               FRANCHISEE JOINDER
                                   TO ADDENDUM

By executing in the space provided below, the Person identified below
acknowledges having received and read, and agrees to become a party to, and be
bound by, the Addendum to Franchise Agreement dated effective as of May 31, 1995
which amends and modifies the Franchise Agreement with The Princeton Review
Management Corp. described below.

DESCRIPTION OF FRANCHISE AGREEMENT:

Date of Franchise Agreement: October 1986.

Name of Franchisee(s): The Princeton Review of Northern California, Inc.
                       -------------------------------------------------

Geographical Area of Franchise Agreement: California: counties of San Francisco,
Marin, Alaveda, Contra and Costa.

                                    Signature of Franchisee(s) or Authorized
                                    Officer of Franchisee(s):

                                    /s/ John Katzman
                                    ----------------

                                    Printed Name of Officer (if applicable):

                                    John Katzman
                                    ------------

                                    Address for Notice:
                                         2315 Broadway
                                         -------------
                                         New York
                                         --------

                                       43
<PAGE>   44
                               FRANCHISEE JOINDER
                                   TO ADDENDUM

By executing in the space provided below, the Person identified below
acknowledges having received and read, and agrees to become a party to, and be
bound by, the Addendum to Franchise Agreement dated effective as of May 31, 1995
which amends and modifies the Franchise Agreement with The Princeton Review
Management Corp. described below.

DESCRIPTION OF FRANCHISE AGREEMENT:

Date of Franchise Agreement: December 30, 1994.

Name of Franchisee(s): The Princeton Review of Vermont, Inc.
                       -------------------------------------

Geographical Area of Franchise Agreement: certain counties in Vermont.
                                          ---------------------------

                                    Signature of Franchisee(s) or Authorized
                                    Officer of Franchisee(s):

                                    /s/ Matthew Rosenthal
                                    ---------------------

                                    Printed Name of Officer (if applicable):

                                    Matthew Rosenthal
                                    -----------------

                                    Address for Notice:
                                         57 Union St., # 1
                                         -----------------
                                         Newton, MA 02159
                                         -----------------

                                       44
<PAGE>   45
                               FRANCHISEE JOINDER
                                   TO ADDENDUM

By executing in the space provided below, the Person identified below
acknowledges having received and read, and agrees to become a party to, and be
bound by, the Addendum to Franchise Agreement dated effective as of May 31, 1995
which amends and modifies the Franchise Agreement with The Princeton Review
Management Corp. described below.

DESCRIPTION OF FRANCHISE AGREEMENT:

Date of Franchise Agreement: March 1, 1995.

Name of Franchisee(s): The Princeton Review of Hawaii, Inc.
                       ------------------------------------

Geographical Area of Franchise Agreement: State of Hawaii.
                                          ---------------

                                    Signature of Franchisee(s) or Authorized
                                    Officer of Franchisee(s):

                                    /s/ Matthew Rosenthal
                                    ---------------------

                                    Printed Name of Officer (if applicable):

                                    Matthew Rosenthal
                                    -----------------

                                    Address for Notice:

                                         57 Union St., # 1
                                         -----------------

                                         Newton, MA 02159
                                         ----------------

                                         ----------------

                                       45
<PAGE>   46
                        ATTACHMENT 1: STATEMENT OF INTER-
                            FRANCHISE TRANSFER POLICY

This Policy is designed to standardize the terns for transferring students
between TPR franchises. In all cases, "Originator" refers to the franchise that
enrolled the student first. "Receiver" refers to the franchise to which the
student wishes to transfer. In cases it is not clear who enrolled the student
first, the franchise that collected money first is the Originator.

In all cases the Originator is responsible for collections from the student. It
may prevent a student from transferring to another franchise (by notifying that
franchise) if it has not received payment, but once a student has transferred,
the Originator must pay the Receiver regardless of whether the student has paid
the Originator.

For the purpose of calculating royalty-service fees payable under the Franchise
Agreement, payments made to a Receiver shall be deducted from the gross receipts
of the Originator, and payments received from the Originator shall be included
the gross receipts of the Receiver.

The Receiver is required to accept transfer students at such times as it is
accepting full paying students or students residing within its Territory. Should
all of its course locations be filled, it must notify the Franchisor before
refusing the student.

Any transfer will require communication among the directors involved. The
Originator and the student are responsible for giving the Receiver at least 1
weeks' notice. It is recommended that all arrangements be made in further in
advance if possible.

The purpose of this transfer agreement is to make our internal arrangements as
invisible as possible to the customer. Offices should make the transfer policy
as smooth as possible for the customer and should refrain from discussing
internal financial arrangements with them.

For the purposes of any calculation required hereunder, all money needed to be
paid shall be rounded to the dollar.

1. Fall Refreshers for Summer courses:

     1.1   Description of Transfer: Many students take TPR courses during the
           Summer. However, the actual exam is not given during the Summer.
           Therefore, TPR offers a brief refresher program before the Fall exams
           for students that took a TPR course during the Summer and wish to
           brush up on their skills prior to the actual exam. Problems arise
           when students wish to take this short brush-up session at another
           course location.

     1.2   Policy: Should a Summer student refresh in the Fall at another
           franchise, the Originator shall pay the Receiver a brush-up fee of
           $50 regardless of the service provided to the transfer student by the
           Receiver. If the cost of the original program is under $195, the
           brush-up fee shall be reduced by the ratio of the cost of the
<PAGE>   47
           program to $195. If the cost of the program is more than $795, the
           brush-up fee shall be increased by the ratio of the cost of the
           program to $795.

The Receiver is obligated to provide the transfer student with the same
refresher it is providing its own Summer students. In the absence of a Summer
refresher, the Receiver may provide the student with some part of the regular
Fall course.

     1.3   If a student takes a Summer refresher at another site, the Originator
           is responsible for any future refresher work done by that student.

     1.4   Key Points: (a) Receiver should have no obligation to collect any
           money directly from the student. (b) Receiver shall provide student
           with all materials necessary to complete refresher program at no
           additional charge to Originator. (c) Each franchisee will distribute
           to students attending its Summer course a listing of franchises
           conducting Summer refreshers. This list will be made available by
           Franchisor. (d) The list of franchises will include a form, to be
           filled in by the student, to ease the billing process for the
           Receiver. (e) Should a student wish to take a refresher at another
           franchise, the student must contact the Receiver one week prior to
           the start of the refresher program or Receiver is not obligated to
           accept the student.

2. In-Course Transfers:

     2.1   Description of Transfer: These transfers occur when a student enrolls
           in a course with a given franchise and desires to take part of the
           course with another franchise. This often happens with college
           students who start the course where they go to college and finish the
           course where their parents live.

     2.2   Policy: If a student transfers to another franchise before the first
           scheduled instructional session of a course at the Originator, and
           does not plan to return, the Originator will keep a Marketing Fee of
           $50 and forward the balance of the course fee collected to the
           Receiver. The student will then receive the entire course from the
           Receiver. In this event only, the Receiver may be responsible for
           collecting the remainder of any course fee not paid. If this is the
           case, the Originator must make this fact clear to the Receiver. If
           the cost of the program is under $195, the Marketing Fee shall be
           reduced by the ratio of the cost of the program to $195. If the cost
           of the program is more than $795, the Marketing Fee shall be
           increased by the ratio of the cost of the program to $795.

     2.3   If a student transfers after the first scheduled instructional
           session of the Originator's course, The Originator will retain a
           Materials Fee of $150.00 and pay the Receiver a pro-rated portion of
           the remaining balance. This portion will be computed using the number
           of instructional sessions (diagnostic exams are excluded) that the
           student will attend at the Receiver divided by the total number of
           instructional sessions in the Receiver's course. If the cost of the
           program is under $495, the Materials Fee shall be reduced by the
           ratio of the cost of the program to $495. If the cost of the

                                       -2-
<PAGE>   48
           program is more than $795, the Materials Fee shall be increased by
           the ratio of the cost of the program to $795.

     2.4   If a student is required to take the first instruction session at the
           Receiver's location, and will complete the course at the Originator's
           location, the Originator shall pay the Receiving site a Day-One Fee
           of $100.00 plus a pro-rated portion of the Originator's course fee
           minus both the Day-One Fee and a Marketing Fee of $50. This portion
           will be computed using the number of instructional sessions
           (diagnostic exams are excluded) that the student will attend at the
           Receiver divided by the total number of instructional sessions in the
           Receiver's course. In this situation, the Receiver is responsible for
           providing all course materials (excluding diagnostics and misc.
           letters) that are necessary to complete the program. If the cost of
           the program is under $495, the Day-One fee shall be reduced by the
           ratio of the cost of the program to $495. If the cost of the program
           is more than $795, the Day-One Fee shall be increased by the ratio of
           the cost of the program to $795. Depending on the price of the
           program, the Marketing Fee referred to in this paragraph may be
           increased or decreased as described in 2.2.

     2.5   Key Points: The Receiver shall be responsible for providing the
           student with the materials needed to complete the course provided at
           their location. The student will not be charged any additional fees.
           Should a student complete more than 50% of the instructional sessions
           at the Receiver's site, the Receiver shall be obligated to provide
           refresher sessions at their location to the student at no additional
           charge to the Originator. Should the student want to take a refresher
           program at another location, the Originating site shall be obligated
           to pay for the refresher program as per section 3, unless the student
           completed more than 75% of the instructional sessions at the
           Receiver's site and in that event the Receiver shall pay for the
           refresher. Also, the Receiver may collect for only one of the above
           paragraphs.

3. Guarantee Fulfillment

     3.1   Description of Transfer: Each TPR franchise makes some guarantees in
           its promotional literature about continuing to work with students
           should their scores not improve to their satisfaction. The guarantee
           is contingent upon the student having completed their TPR course and
           taken the actual exam. The term of the guarantee is one year from
           enrollment. This policy governs the case where a student seeks
           guarantee fulfillment at a franchise other than the one he/she
           originally took the TPR course.

     3.2   Policy: A student will receive a guarantee fulfillment at another
           franchise under one of three circumstances. (a) If the student takes
           a refresher course that consists of fewer than 10 instructional ours,
           the Originator will pay the Receiver $50. (b) If the student takes a
           refresher course that consists of 10 or more instructional hours, the
           Originator will pay the Receiver $150.00. (c) If the student takes
           the entire course, the Originator will pay the Receiver $250.00. If
           the cost of the original program the

                                       -3-
<PAGE>   49
           student took is under $195, the fee referred to in (a) shall be
           reduced by the ratio of the cost of the original program to $195. If
           the cost of the original program the student took is under $495, the
           fee referred to in (b) and (c) shall be reduced by the ratio of the
           cost of the original program to $495. If the cost of the original
           program is more than $795, the fee referred to in (a), (b), and (c)
           shall be increased by the ratio of the cost of the original program
           to $795.

     3.3   Key Points: In each case, course materials will be provided by
           Receiver. Every effort should be taken to minimize the cost of the
           refresher program to the Originator. However, the Originator will be
           obligated to pay for whatever refresher option mentioned above the
           Receiver is offering to its own guarantee fulfillment students.
           Should the Receiver not offer a refresher program, the Originator
           shall be required to pay for option (c). The Receiver must check with
           the Originating site to confirm that the student is in fact eligible
           for a guarantee fulfillment program.

4. Package Pricing

     4.1   Description of Transfer: In the course of transfers/guarantee
           fulfillments referred to in paragraphs 1, 2, and 3, the purchase
           price of various courses may not be clear because they are purchased
           as part of a package. If a student purchases two or more programs
           from a site and receives a discount on any of the programs, the
           programs will as a group be treated as a package for the purposes of
           paragraph 4.2 and 4.3 below.

     4.2   Policy: If a student signs up for a package program, the "reduced"
           purchase price for each separate program shall be the full list price
           of that program reduced by the ratio of the total (discounted)
           package fee to the full price had each part of the package been
           purchased separately. If a student signs up for a package with the
           Originator and then takes an entire part of the package with the
           Receiver, the Originator shall pay the Receiver the entire "reduced"
           price of the course taken with the Receiver.

     4.3   Policy: If the student takes one entire part of a package with the
           Originator and then part of the other with a Receiver, then the
           Originator shall use the "reduced" price to compute the amount due to
           be paid under 2.3 or 2.4, except that the Originator shall keep no
           additional Marketing Fee unless the total amount kept by the
           Originator for the first course is less than the entire Marketing Fee
           under 2.3 or 2.4. For purposes of 2.3 the Marketing Fee shall be 1/3
           of the Materials Fee.

5. Local Promotional Discounts

     5.1   Description of Transfer: Franchises sometimes offer local promotional
           discounts to prospects or students in their areas. This policy
           governs the redemption of promotional discounts at a franchise other
           than the franchise issuing the promotion.

                                       -4-
<PAGE>   50
     5.2   Policy: All franchises shall accept the promotional discount offers
           extended by other franchises unless the discount specifically limits
           the discount with regard to time or geography in a way that
           invalidates it at the time or place it is being used. Receiving
           franchises shall accept these promotional discounts and bill the
           Originating franchise for 50% of the first $100 of the discount plus
           100% of the amount exceeding $100.

6. Tutoring

     6.1   Description of Transfer: Each TPR office offers private tutoring in
           either a hourly format, package format, or both. A student may start
           tutoring in one place and finish in another, or actually receive
           tutoring through two franchises at the same time.

     6.2   Policy: All TPR franchisees work tutoring differently and a cohesive
           policy that anticipates even most eventualities is impossible. In
           general, if their is an up front payment, it should be apportioned
           1/2 to the office that provides materials, 1/6 to the office that
           first enrolled the student as a Marketing Fee, and 1/6 to each office
           as a tutoring Set-up fee. Hourly payments should in general be
           divided based on the number of hours of tutoring that are done in
           each location. However, because prices and plans differ wildly,
           arrangements should be made in advance, and offices have the right to
           charge different amounts to the same student (e.g. a student splits
           tutoring between Westchester and NY and is charged $55/hour for
           tutoring done in Westchester, and $75/hour for tutoring done in NY.)

                                       -5-<PAGE>   1
                                                                   EXHIBIT 10.42

                               FORMATION AGREEMENT

                                  by and among

                              THE PRINCETON REVIEW
                           PUBLISHING COMPANY, L.L.C.

                                       and

                              THE PRINCETON REVIEW
                              PUBLISHING CO., INC.

                                       and

                              THE PRINCETON REVIEW
                                MANAGEMENT CORP.

                                       and

                            THE INDEPENDENT PRINCETON
                               REVIEW FRANCHISEES
<PAGE>   2
                         LIST OF SCHEDULES TO AGREEMENT

<TABLE>
<S>                  <C>  <C>
Schedule 1.1(b)       -   Contracts

Schedule 1.1(t)       -   Governmental Approvals

Schedule 1.1(w)       -   Student Access Contracts

Schedule 4.1(c)       -   Approvals and Notices Required by TPRM and Old PUB;
                          Conflicts with Instruments

Schedule 4.1(d)       -   Title Exceptions

Schedule 4.1(e)       -   Legal Proceedings

Schedule 4.1(f)       -   Defects in Contracts

Schedule 4.1(g)(i)    -   Trademark, Trade Name or Copyright Registrations

Schedule 4.1(g)(ii)   -   Applicable Marks Filing

Schedule 4.1(i)       -   Defects in Governmental Approvals

Schedule 4.1(j)       -   Conduct of Business and Compliance with Regulatory and
                          Contractual Requirements

Schedule 4.1(n)       -   Rights Reservations

Schedule 4.1(p)       -   Labor Matters

Schedule 4.1(r)       -   Material Assets

Schedule 4.1(s)       -   Financial Information

Schedule 4.1(v)       -   Affiliate Transactions
</TABLE>

                                       2
<PAGE>   3
                          LIST OF EXHIBITS TO AGREEMENT

<TABLE>
<S>                  <C>  <C>
Exhibit A             -   Franchisees
Exhibit B             -   Certificate of Formation
</TABLE>

                                       3
<PAGE>   4
                               FORMATION AGREEMENT

         FORMATION AGREEMENT, dated effective as of May 31, 1995 ("Effective
Date"), by and among (i) THE PRINCETON REVIEW PUBLISHING COMPANY, L.L.C., a
Delaware limited liability company (the "Company"), (ii) THE PRINCETON REVIEW
PUBLISHING CO., INC., a New York corporation ("Old PUB"), (iii) THE PRINCETON
REVIEW MANAGEMENT CORP., a Delaware corporation ("TPRM"), and (iv) the persons
identified as "Franchisees" on Exhibit "A" attached hereto (the "Franchisees").

                                    RECITALS

A.       TPRM owns all right, title and interest in and to the use of the trade
         names, trademarks and service marks THE PRINCETON REVIEW, STUDENT
         ACCESS and REVIEWARE (such trade names, trademarks and service marks,
         together with any and all trade names, trademarks and service marks
         which are now or hereafter owned or used by TPRM, being herein
         collectively called the "Applicable Marks").

B.       In connection with the exploitation of the Applicable Marks, TPRM is
         engaged in developing, marketing and servicing test preparation
         businesses through franchised outlets pursuant to written franchise
         agreements ("Franchise Agreements") with independent franchisees and
         franchisees affiliated with TPRM. The collection of business activities
         engaged in and offered through TPRM's franchisee network pursuant to
         the terms of the Franchise Agreements is hereinafter referred to as the
         "Test Preparation Business".

C.       TPRM has also entered into a License Agreement of even date herewith
         with Old Pub (herein called the "TPRM License Agreement"), pursuant to
         which it has granted Old Pub the exclusive rights to use and exploit
         the Applicable Marks in the conduct of the Publishing Business. As used
         herein, the term "Publishing Business" shall mean and refer to (A) the
         businesses previously or currently engaged in by Old PUB and (B) any
         and all other businesses (except for the Test Preparation Business),
         whether now or hereafter conducted, which (i) relate to, involve or are
         competitive with the TPR Method or (ii) use the Applicable Marks in any
         part of the conducting thereof. The "Publishing Business" shall
         include, without limitation, the business of creating, publishing and
         marketing books, videotapes, audiotapes, computer software and other
         products or services. As used herein, the term "TPR Method" shall mean
         instruction for academic

                                       4
<PAGE>   5
         subjects, computer usage, languages, negotiation, financial aid, test
         preparation or admissions advice for actual or prospective grade
         school, high school, college, graduate or professional school students
         or adults.

D.       Pursuant to its Franchise Agreement with TPRM, each Franchisee
         currently has certain territorial protection rights that may preclude
         TPRM and Old PUB from conducting a portion of the Publishing Business
         in such Franchisee's franchise territory.

E.       The parties desire to enter into this Formation Agreement to provide
         for the formation of the Company and to have the Company conduct the
         Publishing Business. In connection with such formation, (i) Old PUB
         shall contribute the Publishing Business to the Company, in exchange
         for the issuance to Old PUB of 8,238.12 units of voting membership
         interests (herein collectively the "Old PUB Units") and (ii) each
         Franchisee shall contribute the Territorial Right to the Company in
         exchange for the number of units of non-voting membership interests set
         forth opposite each such Franchisee's name on Exhibit "A"
         (collectively, the "Franchisees Units"). As used herein, the term
         "Territorial Right" shall mean, with respect to each Franchisee, its
         agreement hereby made by such Franchisee for the benefit of the Company
         that the Company may, notwithstanding the provisions of such
         Franchisee's Franchise or any other Agreement, pursue the Publishing
         Business in such Franchisee's franchised territory (subject to the
         limitations described herein).

                                       5
<PAGE>   6
                                    AGREEMENT

         In consideration of the premises and of the respective representations,
warranties, covenants, agreements and conditions of the parties contained
herein, it is hereby agreed as follows:

1.       Contribution by Old PUB; Assumption of Certain Liabilities.

         1.1.     Transfer of Assets. On the terms and subject to the conditions
                  set forth in this Agreement, effective as of the Effective
                  Date, Old PUB shall convey, assign, grant, transfer and
                  deliver to the Company, as a capital contribution in exchange
                  for the Old PUB Units, all of the OLD PUB assets, rights and
                  properties however owned as of the Effective Date and used
                  directly or indirectly in the conduct of the Publishing
                  Business or otherwise associated with or related thereto (the
                  "Assets"), including without limitation:

                  (a)      All computer programs, in object and source code
                           form, flow charts, layouts, user's manuals,
                           operator's manuals and other documentation in human
                           readable or machine readable form developed by or for
                           Old PUB in connection with the conduct of the
                           Publishing Business, and all copyrights, trade
                           secrets or know-how related thereto (the "Software");

                  (b)      All right, title and interest of Old PUB in, to and
                           under all contracts, license agreements, leases and
                           other arrangements which are related to the conduct
                           of the Publishing Business, including but not limited
                           to the TPRM License Agreement, publishing contracts,
                           manuscript and editorial/consulting agreements,
                           advertising agreements and advertising sales
                           representative agreements, distribution agreements,
                           development and marketing agreements, endorsement
                           contracts, and those agreements listed on Schedule
                           1.1(b) hereto (collectively, the "Contracts");

                  (c)      All circulation records relating to any Published
                           Product (as defined in Section 2.3 hereof) including,
                           but not limited to specific names of all buyers,
                           addressees, zip codes and prices paid;

                  (d)      All promotional materials relating to any Published
                           Product, including any and all plates and
                           camera-ready copy, new promotion letters, flyers,
                           reply cards and any other printed matter in Old PUB's
                           possession or control relating to the promotion of
                           any Published Product;

                                       6
<PAGE>   7
                  (e)      All promotion and marketing records relating to any
                           Published Product or the Publishing Business,
                           including any and all records of mailing lists used,
                           packages used, dates mailed, rates of return, sample
                           mailing pieces, space advertising and the like;

                  (f)      All records of inquiries and prospects of the
                           Publishing Business, including, without limitation,
                           any and all correspondence, directories, attendance
                           lists or labels;

                  (g)      All subscriber correspondence files, including,
                           without limitation, any and all correspondence
                           regarding subscriptions, refunds, and editorial
                           matters relating to any Published Product;

                  (h)      All back issues or other inventories of any Published
                           Product which Old PUB may now possess;

                  (i)      All existing records in the possession or control of
                           Old PUB relating to advertising sales for any
                           Published Product or the Publishing Business,
                           including, but not limited to (i) copies of all past,
                           present and pending advertising sales contracts and
                           all advertising sales representative agreements; (ii)
                           all lists of past, present or prospective
                           advertisers; (iii) any and all material which may
                           provide guidance to the advertising sales
                           representatives concerning the sale of advertising
                           for the Publishing Business; and (iv) for each
                           advertising sales account, a listing of the company
                           name, address, phone number, contact history and
                           sales history;

                  (j)      All of Old PUB's rights to use any and all editorial
                           and promotional copy previously written or developed
                           by or for Old PUB for the Publishing Business,
                           including any and all rights to promotional copy,
                           direct mail packages, renewal packages and media
                           kits;

                  (k)      All rights of Old PUB to use (whether as owner,
                           licensee or otherwise) all mechanicals, photos, logos
                           and other art work which may be utilized in or
                           developed for or in connection with the Publishing
                           Business, whether or not in Old PUB's physical
                           possession;

                  (l)      All right, title and interest of Old PUB in, to and
                           under any oral or written bid, quotation or proposal
                           relating to the sale or licensing of any Published
                           Product;

                  (m)      All trade secrets, technical knowledge and other
                           intellectual property (including all copyright
                           registrations and all other copyrights or

                                       7
<PAGE>   8
                           copyrightable work owned by Old PUB) used by Old PUB
                           in connection with the conduct of the Publishing
                           Business other than TPRM's interest in the Applicable
                           Marks (the "Intellectual Property");

                  (n)      All rights, claims or choses in action of Old PUB
                           against any person relating to any other Asset;

                  (o)      All rights of Old PUB in tangible personal property
                           associated with the Publishing Business and all
                           warranties and guarantees, if any, express or
                           implied, existing for the benefit of Old PUB in
                           connection with such tangible property to the extent
                           assignable;

                  (p)      The accounts receivable of Old PUB as of the
                           Effective Date (the "Accounts Receivable");

                  (q)      All personnel files and other materials relating to
                           any employees of Old PUB who are to be offered
                           employment by the Company;

                  (r)      All records of compliance and noncompliance with the
                           laws, regulations, ordinances and orders applicable
                           to the Publishing Business;

                  (s)      All deposits, prepayments and prepaid expenses
                           relating to the operations of the Publishing Business
                           by Old PUB;

                  (t)      The rights of Old PUB under all licenses, permits,
                           franchises issued by any federal, state, provincial
                           or municipal authority relating to conduct of the
                           Publishing Business ("Governmental Approvals"),
                           including without limitation, those listed on
                           Schedule 1.1(t) hereto, to the extent that such
                           Governmental Approvals are transferable;

                  (u)      All goodwill of Old PUB relating to the Assets and
                           the Publishing Business as a going concern other than
                           goodwill attributable to the Applicable Marks which
                           shall inure solely to the benefit of TPRM;

                  (v)      All cash and cash equivalent or similar types of
                           investments, such as certificates of deposit,
                           treasury bills, and other marketable securities,
                           including any cash contributed to Old PUB pursuant to
                           Section 5.3(e);

                  (w)      All contracts and membership lists and other
                           properties owned by Student Access, Ltd., a Delaware
                           corporation ("Student Access"), including those
                           agreements listed on Schedule 1.1(w) hereto;

                  (x)      To the extent not otherwise covered, the originals of
                           all information, files, records, data and contracts
                           related to any of the other Assets;

                  (y)      Claims for refunds of taxes and other governmental
                           charges; and

                                       8
<PAGE>   9
                  (z)      The financial records, tax records and corporate
                           policies and procedures manuals of Old PUB.

         1.2.     Instruments of Conveyance and Transfer. Effective as of the
                  Effective Date, Old PUB shall deliver or cause to be delivered
                  to the Company the following:

                  (a)      Assignments and bills of sale transferring to the
                           Company good and valid title to the Assets, free and
                           clear of all liens, claims and encumbrances except as
                           shown on Schedule 4.1(d) hereto or as otherwise
                           specifically permitted pursuant to the terms of this
                           Agreement, and all in a form reasonably satisfactory
                           to the Company and the Franchisees;

                  (b)      To the extent available, originals of all of the
                           contracts, agreements, commitments, books, records,
                           files and other data that are included in the Assets;
                           and

                  (c)      Such other instruments of transfer and assignment in
                           respect of the Assets as the Company and the
                           Franchisees shall reasonably require pursuant to
                           written notice given no less than twenty (20) days
                           prior to the Effective Date and as shall be
                           consistent with the terms and provisions of this
                           Agreement.

Prior to the Closing, Old PUB will take such steps as may be requisite or
appropriate so that no later than the close of business on the Effective Date,
the Company to the extent reasonably practicable will be placed in actual
possession and control of all of the Assets. Without limiting the generality of
the foregoing, Old PUB agrees it shall use its reasonable best efforts to obtain
all material consents and approvals of third parties required for the transfer
of the Assets contemplated herein.

         1.3.     Further Assurances. From time to time after the Closing, Old
                  PUB will execute and deliver, or cause to be executed and
                  delivered, without further consideration, such other
                  instruments of conveyance, assignment, transfer and delivery
                  and will take such other actions as the Company and the
                  Franchisees may reasonably request in order to more
                  effectively consummate the transactions contemplated by this
                  Agreement and to transfer, convey, assign and deliver to the
                  Company, and to place the Company in possession and control of
                  any of the Assets, or to enable the Company to exercise and
                  enjoy all rights and benefits of Old PUB with respect thereto.

         1.4.     Assumed Liabilities. The Company will (i) assume and pay,
                  perform, fulfill and discharge all asserted and unasserted
                  obligations of Old PUB as of the Effective

                                       9
<PAGE>   10
                  Date, and (ii) pay, perform, fulfill and discharge all
                  obligations of Student Access which are due and payable (or
                  performable) subsequent to the Effective Date under the
                  contracts of Student Access listed on Schedule 1.1(w) (the
                  "Assumed Liabilities"). The obligations of the Company with
                  respect to the Assumed Liabilities are subject to whatever
                  rights the Company may have under this Agreement or otherwise
                  for a breach by Old PUB or TPRM of any representation,
                  warranty, covenant or agreement contained in this Agreement.

         1.5.     Special TPRM Covenant and Agreement. TPRM hereby acknowledges
                  and agrees that it and Old PUB are both controlled by John S.
                  Katzman. TPRM further acknowledges and agrees that without the
                  obligations undertaken by TPRM under the terms of this
                  Agreement, the Franchisees would not be willing to enter into
                  this Agreement. TPRM further covenants and agrees that it will
                  cause Old PUB to timely and properly perform and comply with
                  all of Old PUB's obligations hereunder to the Company and/or
                  Franchisees, and TPRM hereby unconditionally guarantees all
                  such obligations.

2.       Contribution by Princeton Review Franchisees. On the terms and subject
         to the conditions set forth in this Agreement, effective as of the
         Effective Date, each of the Franchisees does hereby convey, assign,
         grant, transfer and deliver to the Company, as a contribution to the
         capital of the Company and in exchange for the number of Franchisees
         Units set forth opposite such Franchisee's name on Exhibit "A" attached
         hereto, the Territorial Right by agreeing with the Company, for the
         Company's sole and exclusive benefit, as follows:

         2.1.     Subject to the provisions of Section 2.4 hereof, the Company
                  shall have the right, notwithstanding anything to the contrary
                  contained in such Franchisee's Franchise Agreement with TPRM
                  or any other agreement or understanding made prior to the
                  Closing Date, to market in Franchisee's franchised territory
                  any Published Product (herein defined) using the Applicable
                  Marks or any other names and marks, whether created prior or
                  subsequent to the Effective Date.

         2.2.     As used herein the term "Published Product" shall mean any
                  product which is sold, leased or otherwise provided to
                  customers and which does not include, as any part thereof, (i)
                  face-to-face instruction of a customer or (ii) instruction
                  delivered through real time (i.e. not pre-recorded or delayed
                  transmissions) interactive technology that simulates a
                  classroom or tutoring experience.

                                       10
<PAGE>   11
         2.3.     As used herein the term "Test Preparation Product" shall mean
                  any kind of Published Product which is sold, leased or
                  otherwise provided to customers and which primarily addresses
                  a college or graduate school admissions test.

                  (a)      If two or more Test Preparation Products are marketed
                           as a single item, that item will itself be considered
                           a Test Preparation Product, whose suggested retail
                           price, if it does not have its own, shall be the sum
                           of the suggested retail prices of its components. Two
                           or more Test Preparation Products shall be considered
                           to be "marketed as a single item" for purposes
                           hereof, if such Test Preparation Products are
                           physically packaged together, offered for sale with a
                           single price or with a discount for buying all of
                           them; or advertised or marketed as component parts of
                           a complete set.

                  (b)      Any two or more Test Preparation Products (after
                           application of clause (a) above) which (i) primarily
                           address the same admissions test, (ii) are in the
                           same media (examples of types of "media" for these
                           purposes include Macintosh compatible disks, MS/DOS
                           compatible disks, printed materials and videotapes);
                           and (iii) are not themselves components of other Test
                           Preparation Products in the same media, shall be
                           deemed to be one Test Preparation Product with one
                           suggested retail price equal to the sum of the
                           suggested retail prices of all the separate Test
                           Preparation Products. For purposes of clause (ii) in
                           the immediately preceding sentence, a Test
                           Preparation Product which is composed of separate
                           items in different media shall be deemed to be in the
                           media of the most expensive component item of such
                           Test Preparation Product.

         2.4.     Notwithstanding the provisions of Section 2.1 hereof, the
                  following provisions shall apply:

                  (a)      The Company shall not have the right to market in
                           Franchisee's franchised territory any Test
                           Preparation Product which has a suggested retail
                           price in excess of the then Maximum Allowable Price,
                           unless the marketing of such Test Preparation Product
                           is approved by an 85% Zee Vote (as that term is
                           defined and used in the various Addenda entered into
                           between TPRM and each of the Franchisees of even date
                           herewith). With respect to any structured curriculum
                           taught on-line (e.g. through a computer or video
                           network) which is sold at an hourly rate, the hourly
                           selling price

                                       11
<PAGE>   12
                           of such curriculum shall be deemed to equal, for
                           purposes of this Section 2.4(a), the greater of (i)
                           18.75% of the then Maximum Allowable Price; or (ii)
                           the actual retail hourly selling price thereof.

                  (b)      The Company shall not (i) encourage any school,
                           organization or other person to use any Test
                           Preparation Product for the conducting of a class or
                           other course for any group of students; or (ii)
                           intentionally create confusion that any Test
                           Preparation Product is the same product as any course
                           taught by the Franchisees pursuant to their
                           respective Franchise Agreements with TPRM.

                  (c)      The Territorial Right is not assignable or
                           transferable to any person or entity other than a
                           person or entity that is simultaneously acquiring all
                           of the Company's rights under the TPRM License
                           Agreement.

         2.5.     As used herein, the term "Maximum Allowable Price" shall mean,
                  until December 31, 1995, $80.00. In order to reflect
                  subsequent changes in the average cost of products similar to
                  Test Preparation Products, the parties agree that the Maximum
                  Allowable Price shall be adjusted on December 31, 1995 and
                  each December 31 thereafter, by a percentage amount equal to
                  the average percentage change in the Applicable Indices
                  (herein defined) from the December of the previous year. As
                  used herein, the term "Applicable Indices" shall mean and
                  refer to the following:

                  (a)      The "Information Processing Equipment" Index
                           published monthly by the Bureau of Labor Statistics
                           as one of the expenditure categories of the Consumer
                           Price Index for all Urban Consumers ("CPI");

                  (b)      The "School Books and Supplies" Index published
                           monthly by the Bureau of Labor Statistics as one of
                           the expenditure categories of the CPI; and

                  (c)      The "Tuition and Other School Fees" Index published
                           monthly by the Bureau of Labor Statistics as one of
                           the expenditure categories of the CPI.

         2.6.     The Franchisees hereby withhold any permission granted above
                  for the Company or its Affiliates to exploit electronically
                  the following titles until there is an agreement between TPRM,
                  John Katzman, David Owen and Adam Robinson, and the Company in
                  a form satisfactory to John Katzman, modifying the terms of
                  all prior agreements between the parties with respect to the
                  exploitation of such titles: "Cracking the SAT", "Cracking the
                  GMAT", "Cracking the GRE" and "Cracking the LSAT".

                                       12
<PAGE>   13
3.       Closing. The closing with respect to the transactions provided for in
         this Agreement (the "Closing") is taking place effective as of the
         Effective Date.

4.       Representations and Warranties.

         4.1.     Representations and Warranties of TPRM and Old PUB. TPRM and
                  Old PUB represent and warrant, jointly and severally, to the
                  Company and the Franchisees, the following:

                  (a)      Due Organization; Good Standing and Power. Each of
                           TPRM and Old PUB is a corporation duly organized,
                           validly existing and in good standing under the laws
                           of the State of New York. Old PUB has all corporate
                           power and authority to own the Assets and to conduct
                           the Publishing Business as now conducted. Each of Old
                           PUB and TPRM has all requisite power and authority to
                           enter into this Agreement and each other agreement,
                           conveyance and assignment provided for or
                           contemplated herein (the "Other Agreements") and to
                           perform their respective obligations hereunder and
                           thereunder.

                  (b)      Authorization and Validity of Agreement. The
                           execution, delivery and performance of this Agreement
                           and the Other Agreements by each of Old PUB and TPRM
                           and the consummation by each such party of the
                           transactions contemplated hereby and thereby have
                           been duly authorized by all necessary corporate
                           action on the part of each such party. No other
                           corporate or shareholder action is necessary for the
                           authorization, execution, delivery and performance by
                           Old PUB or TPRM of this Agreement or any Other
                           Agreement and the consummation by them of the
                           transactions contemplated hereby and thereby. This
                           Agreement and the Other Agreements have been duly
                           executed and delivered by Old PUB and TPRM and
                           constitute the legal, valid and binding obligations
                           of Old PUB and TPRM, enforceable against such parties
                           in accordance with their terms.

                  (c)      No Approvals or Notices Required; No Conflict with
                           Instruments. Except as described in Schedule 4.1(c)
                           hereto, the execution, delivery and performance of
                           this Agreement or any Other Agreement by Old PUB and
                           TPRM and the consummation by it of the transactions
                           contemplated hereby and thereby (i) will not violate
                           in any material respect (with or

                                       13
<PAGE>   14
                           without the giving of notice or the lapse of time or
                           both) or require any consent, approval, filing or
                           notice under, any provision of any law, rule or
                           regulation, court order, judgment or decree
                           applicable to Old PUB or TPRM and (ii) will not in
                           any material respect conflict with, or result in the
                           breach or termination of any material provision of,
                           or constitute a material default under, or require
                           any consent or approval, or result in the
                           acceleration of the performance of the obligations of
                           Old PUB or TPRM under, or result in the creation of a
                           lien, charge or encumbrance upon a portion of the
                           Assets pursuant to, the Articles of Incorporation or
                           Bylaws of Old PUB or TPRM, or any indenture,
                           mortgage, deed of trust, lease, licensing agreement,
                           or material contract, instrument or Other Agreement
                           to which either such entity is a party or by which it
                           or any of the Assets are bound or affected.

                  (d)      Title to Properties; Absence of Liens and
                           Encumbrances. Old PUB owns and will transfer to the
                           Company as of the Effective Date, good and valid
                           title to all of the Assets, free and clear of all
                           claims, liens, security interests, charges, leases,
                           encumbrances, licenses or sublicenses and other
                           restrictions of any kind and nature, except as
                           specified on Schedule 4.1(d) hereto or the
                           encumbrances and restrictions set forth in the
                           contracts disclosed pursuant to this Agreement, or
                           which would not otherwise materially interfere with
                           the use and enjoyment of such Assets by the Company.

                  (e)      Legal Proceedings. Except as described in Schedule
                           4.1(e) hereto, (i) there is no litigation,
                           proceeding, claim or governmental investigation
                           pending or, to the knowledge of Old PUB and TPRM,
                           threatened seeking relief or damages which, if
                           granted, would materially and adversely affect Old
                           PUB, or the ownership, use or operation of any of the
                           Assets or the results of operations of the Publishing
                           Business and (ii) Old PUB has not been charged with
                           any violation of or, to the knowledge of Old PUB and
                           TPRM, threatened with a charge or violation of, nor
                           are Old PUB or TPRM aware of any facts or
                           circumstances that, if discovered by third parties,
                           could give rise to a charge or a violation of, any
                           provision of law or regulation which charge or
                           violation, if determined adversely to Old PUB, would
                           materially and adversely affect the ownership, use or

                                       14
<PAGE>   15
                           operation of any of the Assets or the results of
                           operations of the Publishing Business.

                  (f)      Contracts and Commitments. Old PUB and Student Access
                           are not parties to any material Contract relating to
                           the Publishing Business other than as listed or
                           described on Schedule 1.1(b) or Schedule 1.1(w).
                           Except as may be disclosed on Schedule 4.1(f) hereto,
                           each material Contract is valid and enforceable in
                           accordance with its terms, and Old PUB (or Student
                           Access) is not in breach in the performance,
                           observance or fulfillment of any obligation, covenant
                           or condition contained therein, and no event has
                           occurred which (with or without the giving of notice
                           or lapse of time, or both) would have a material
                           adverse effect on the ownership, use, or operation of
                           any of the Assets or the results of operations of the
                           Publishing Business, and to the knowledge of Old PUB
                           and TPRM, no party is in breach, default or
                           noncompliance with the terms thereunder. Old PUB has
                           not received any notice or claim that it is in breach
                           of any provision of any material Contract. Old PUB
                           has delivered to the Company true and complete copies
                           of all the written Contracts listed on Schedule
                           1.1(b) and Schedule 1.1(w), as amended.

                  (g)      Intellectual Property and Applicable Marks.

                           (i)      Excluding the Applicable Marks, the
                                    Intellectual Property (including any
                                    licensing of intellectual property)
                                    constitutes all intellectual property used
                                    or needed by Old PUB to conduct the
                                    Publishing Business in the ordinary course,
                                    and Old PUB has the unrestricted ownership
                                    right to convey to the Company all such
                                    Intellectual Property. To the knowledge of
                                    Old PUB and TPRM, there is no basis for
                                    assertion by any person of any claim against
                                    Old PUB or the Company with respect to the
                                    use by Old PUB or the Company of any of the
                                    Intellectual Property. Old PUB is not
                                    infringing or violating, and to the
                                    knowledge of Old PUB and TPRM, Old PUB has
                                    not infringed or violated, any rights of any
                                    person with respect to any of the
                                    Intellectual Property, and the Intellectual
                                    Property is not subject to any order,
                                    injunction or agreement respecting its use.
                                    To the knowledge of Old PUB and TPRM, no
                                    others have infringed or are infringing upon

                                       15
<PAGE>   16
                                    the Intellectual Property. As of the date
                                    hereof, Old PUB has filed no trademark or
                                    trade name or copyright registrations with
                                    respect to the Publishing Business, except
                                    those set forth on Schedule 4.1(g)(i)
                                    hereto.

                           (ii)     TPRM owns all the Applicable Marks, free and
                                    clear of any right, title and interest,
                                    claim or encumbrance of any third party.
                                    TPRM has the unrestricted ownership right to
                                    license the Applicable Marks to Old PUB
                                    pursuant to the terms of the TPRM License
                                    Agreement. There is no claim or demand known
                                    to either TPRM or Old PUB of any person
                                    pertaining to, or any proceedings which are
                                    pending or, to the best knowledge of Old PUB
                                    and TPRM, threatened, which challenges the
                                    right of TPRM or Old PUB in respect of any
                                    Applicable Mark. No Applicable Mark is
                                    subject to any outstanding order, ruling,
                                    decree, judgment or stipulation by or with
                                    any court, arbitrator or administrative
                                    agency, or, to the knowledge of Old PUB and
                                    TPRM, infringes or is being infringed by
                                    others. Schedule 4.1(g)(ii) lists all
                                    pending or existing federal or state
                                    trademark applications or registrations
                                    filed by or granted to TPRM with respect to
                                    the Applicable Marks. Old PUB has the right
                                    to transfer the TPRM License Agreement to
                                    the Company pursuant to the terms hereof.

                  (h)      Software. Old PUB has rights to the Software, the
                           nature of which varies among the total collection
                           pursuant to applicable agreements, but which rights
                           taken together are sufficient to allow Old PUB to
                           conduct the Publishing Business in the manner
                           presently conducted. The rights, title and interest
                           in and to the Software contributed herein by Old PUB
                           consist of all those under which Old PUB has
                           conducted the Publishing Business as of the Closing,
                           and Old PUB has exercised reasonable care and prudent
                           business practices to protect its rights in such
                           Software.

                  (i)      Governmental Approvals. Except as described on
                           Schedule 4.1(i) hereto, Old PUB has and is fully
                           authorized to assign to the Company, all Governmental
                           Approvals, and such Governmental Approvals are in
                           full force and effect and constitute the only
                           licenses, permits, consents, approvals,
                           authorizations, qualifications and orders of
                           governmental

                                       16
<PAGE>   17
                           authorities required for the ownership, use or
                           operation of the Assets or the conduct of the
                           Publishing Business, the failure of which to obtain
                           or maintain would individually or in the aggregate
                           materially and adversely affect the ownership, use or
                           operation of any of the Assets or the results of
                           operations of the Publishing Business.

                  (j)      Conduct of Business in Compliance with Regulatory and
                           Contractual Requirements. Except as described on
                           Schedule 4.1(j) hereto, Old PUB has conducted the
                           Business so as to comply with all applicable laws,
                           ordinances, codes, regulations, rights of concession,
                           licenses, know-how or other proprietary rights of
                           others, the failure to comply with which would
                           individually or in the aggregate materially and
                           adversely affect the ownership, use or operation of
                           any of the Assets or the results of operations of the
                           Publishing Business.

                  (k)      Certain Fees. Old PUB and TPRM and their officers,
                           representatives and employees have not employed any
                           broker or finder or incurred any other liability for
                           any brokerage fees, commissions or finders' fees in
                           connection with the transactions contemplated hereby.

                  (l)      Books and Records. All of the books and records
                           relating to the Assets and the conduct of the
                           Publishing Business (including all of the books and
                           records of the type referred to in Section 1.1
                           hereof) have in all material respects been prepared
                           and maintained in accordance with good business
                           practices and, where applicable, in conformity with
                           generally accepted accounting principles and in
                           compliance with all applicable laws, regulations and
                           other requirements.

                  (m)      Taxes. Old PUB has caused to be timely filed with
                           appropriate federal, state, local and other
                           governmental authorities all tax returns, information
                           returns or statements and reports required to be
                           filed with respect to the Assets or the conduct of
                           the Publishing Business and have paid or caused to be
                           paid all taxes shown to be due on such returns or
                           reports, except for any non-filing which would not
                           have a material and adverse effect on the Assets or
                           the results of operations of the Publishing Business.
                           Old PUB has not received and neither it nor TPRM has
                           any knowledge of any notice of deficiency or
                           assessment or proposed deficiency or assessment with
                           respect to any of the Assets or the conduct of the
                           Publishing Business

                                       17
<PAGE>   18
                           from any taxing authority, and there are no
                           outstanding agreements or waivers that extend any
                           statutory period of limitations applicable to any
                           federal, state or local income or franchise tax
                           returns that include or reflect the use and operation
                           of the Assets or the conduct of the Publishing
                           Business.

                  (n)      Rights of Third Parties. The Assets are transferable
                           and assignable to the Company as contemplated by this
                           Agreement without the waiver of any right of first
                           refusal or the consent of any other party being
                           obtained, and there exists no preferential right of
                           purchase in favor of any person with respect to any
                           of the Assets, Old PUB or the Publishing Business,
                           subject to the reservations of rights contained in
                           the agreements listed on Schedule 4.1(n) hereto.

                  (o)      Disclosure. No representation or warranty in this
                           Section 4.1 or in any Schedule or Exhibit to this
                           Agreement, or in any written statement, certificate
                           or other document furnished to the Company or the
                           Franchisees contains or will contain any untrue
                           statement of a material fact or omits or will omit a
                           material fact necessary to make the statements
                           therein not misleading.

                  (p)      Labor Matters. To the knowledge of Old PUB and TPRM,
                           there are no controversies pending or threatened
                           between Old PUB and any of its employees or former
                           employees, which controversies have or could
                           reasonably be expected to have a material adverse
                           effect on the Assets or the results of operations of
                           the Publishing Business. Except as set forth on
                           Schedule 4.1(p) hereto, Old PUB has no collective
                           bargaining agreements, employment contracts, employee
                           benefit plans or any other binding agreements
                           relating to the employment of any of its employees.
                           To the knowledge of Old PUB and TPRM, Old PUB is in
                           substantial compliance with all federal and state
                           laws respecting employment and employment practices,
                           terms and conditions of employment, and wages and
                           hours, except for where the failure to so comply
                           would not materially and adversely affect the Assets
                           or the results of operations of the Publishing
                           Business, and Old PUB is not engaged in any unfair
                           discriminatory labor practice; no unfair labor
                           practice complaint against Old PUB is pending before
                           the National Labor Relations Board; there is no labor
                           strike,

                                       18
<PAGE>   19
                           dispute, slow down or stoppage actually pending or,
                           to the knowledge of Old PUB, threatened against or
                           involving Old PUB or the Publishing Business; to the
                           knowledge of Old PUB and TPRM, no representation
                           question exists with respect to the employees of Old
                           PUB; no collective bargaining agreement is currently
                           being negotiated by Old PUB; Old PUB has not
                           experienced any work stoppage or other similar labor
                           difficulty since formation of Old PUB; and to the
                           knowledge of Old PUB and TPRM, there are no claims
                           against Old PUB pending before the Equal Employment
                           Opportunity Commission.

                  (q)      Benefit Plans. No action or failure to take action by
                           Old PUB or TPRM prior to the Closing (including the
                           consummation of the transactions contemplated hereby)
                           has created or will create any lien in favor of the
                           Pension and Benefit Guaranty Corporation or any
                           beneficiary under any Plan or in favor of any other
                           person or entity pursuant to ERISA or any other
                           similar law, rule or regulation.

                  (r)      Material Assets. The Assets constitute all the assets
                           necessary to conduct the Publishing Business in the
                           manner now presently conducted by Old PUB, except as
                           otherwise disclosed on Schedule 4.1(r) attached
                           hereto. Upon the consummation of the transaction
                           provided for herein, Old PUB will not have assets, in
                           the aggregate, of material value.

                  (s)      Financial Information and Absence of Certain Changes.
                           Attached hereto as Schedule 4.1(s) are (i) the
                           unaudited balance sheet of Old PUB as at December 31,
                           1994 and the related statement of operation and
                           schedule of selling, general and administrative
                           expenses for the fiscal year then ended; and (ii) an
                           unaudited balance sheet of Old PUB as at March 31,
                           1995 and the related statement of operation and
                           schedule of selling, general and administrative
                           expenses for the three months then ended, including
                           in each case, notes thereto, if any. Such financial
                           statements are true, complete and correct in all
                           material respects and prepared in accordance with
                           generally accepted accounting principles applied on a
                           consistent basis. The balance sheets represent fairly
                           the financial position of Old PUB as of the
                           respective dates thereof, and the statement of
                           operation and schedule of expenses included in such
                           financial statements present fairly the results of
                           operation and expenses of Old PUB for each of the
                           periods covered

                                       19
<PAGE>   20
                           thereby. As of December 31, 1994 and March 31, 1995,
                           except as disclosed on Schedule 4.1(s) Old PUB did
                           not have any material liabilities (including any
                           relating to the Publishing Business), whether
                           absolute, accrued or contingent, whether due or to
                           become due, which were not reserved against in, or
                           reflected on, the respective balance sheets as of
                           such dates in accordance with and to the extent
                           required by generally accepted accounting principles.
                           Since December 31, 1994, except as otherwise
                           disclosed on Schedule 4.1(s), there has not been (A)
                           any material adverse change in the financial
                           condition, assets, liabilities, earnings, business
                           prospects or customer supply relationships of the
                           Publishing Business, (B) any material damage,
                           destruction or loss adversely affecting the
                           Publishing Business or any of the Assets, (C) any
                           sale, assignment, transfer, lease or other
                           disposition of any material asset of Old PUB other
                           than sales of inventory in the ordinary course of the
                           Publishing Business, (D) any change by Old PUB in
                           accounting methods or principles or the application
                           thereof or any change in Old PUB's policies or
                           practices with respect to reserves for bad debts,
                           inventory obsolescence or other items affecting
                           working capital, (E) any waiver by Old PUB of any
                           rights that, singly or in the aggregate are material
                           to the Publishing Business, the Assets or the
                           financial condition or the results of operations of
                           the Publishing Business, (F) any mortgage or pledge
                           of or grant of a lien or security interest in any of
                           the Assets, or (G) any contract or commitment to do
                           or cause to be done any of the foregoing. Without
                           limiting the generality of the foregoing, since the
                           December 31, 1994 balance sheet, Old PUB has not
                           incurred or become subject to or agreed to incur or
                           become subject to, any obligation or liability,
                           absolute or contingent, except current liabilities
                           incurred in the ordinary course of business.

                  (t)      Employee Information. Old PUB has delivered or made
                           available to the Company and the Franchisees an
                           accurate list and summary description of the
                           following:

                           (i)      the names and titles of and current annual
                                    base salaries or hourly rates for all key
                                    employees involved in the conduct of the
                                    Publishing Business, together with a
                                    statement of the full amount

                                       20
<PAGE>   21
                                    and nature of any other remuneration,
                                    whether in cash or kind, paid to each such
                                    person during the current fiscal year; and

                           (ii)     with respect to each consultant or other
                                    third party who provides personal service in
                                    connection with the Publishing Business, the
                                    same information as described above, but
                                    only if the yearly compensation to such
                                    consultant or other third party exceeds
                                    $10,000.

                  The foregoing information shall not be understood to be a
                  representation as to the personnel needs and costs of the
                  Company.

                  (u)      Accounts Receivable. All of the Accounts Receivable
                           are valid and enforceable claims and are not subject
                           to any valid defenses or offsets, and, to the
                           knowledge of Old PUB and TPRM, may be collected by
                           use of efforts customary in the industry.

                  (v)      Transaction with Affiliates. Schedule 4.1(v) hereto
                           lists all written contracts or agreements Old PUB has
                           with any of its affiliates (including TPRM). There
                           are no such material unwritten contracts between the
                           Company and any affiliates.

                  (w)      Special PUB Representations. Attached as Exhibit "B"
                           is a true and accurate copy of the Certificate of
                           Formation of the Company, and such Certificate has
                           not been amended as of the Effective Date. As of the
                           date hereof, no units of voting or non-voting
                           membership interests of the Company have been issued
                           or sold and the Company has no obligation to issue
                           any such units pursuant to outstanding options,
                           warrants, or otherwise, except as specifically
                           contemplated by the terms of this Agreement or as
                           described on Schedule 4.1(w) attached hereto. Except
                           for the filing of the Certificate of Formation, prior
                           to the Effective Date, the Company has taken no
                           corporate or other action.

                  (x)      Business Plan. Old PUB has provided to the
                           Franchisees all current written information in its
                           possession that relates to the proposed business
                           plans for the Publishing Business, including all
                           financial projections and other financial information
                           relating thereto, and is not information provided to
                           OLD PUB by a third party which is subject to a
                           confidentiality obligation in favor of such third
                           party. It is understood that Old PUB makes no
                           representation or warranty whatsoever with respect to
                           the

                                       21
<PAGE>   22
                           accuracy or completeness of any such document or
                           projection, or with respect to the underlying
                           assumptions or achievability thereof.

         4.2.     Representations and Warranties of Franchisees. Each of the
                  Franchisees, severally, but not jointly, represents and
                  warrants to the Company, TPRM, and Old PUB as follows:

                  (a)      Due Organization; Good Standing and Power. Each
                           corporate Franchisee is a corporation duly organized,
                           validly existing and in good standing under the laws
                           of its respective jurisdiction of incorporation, and
                           is duly qualified to do business and is in good
                           standing in all jurisdictions in which it is required
                           to be so qualified, except for where the failure to
                           so qualify would not be material. Each corporate
                           Franchisee has full power and authority to enter into
                           and carry out this Agreement and the Other
                           Agreements, and to perform its respective obligations
                           hereunder and thereunder. Each individual Franchisee
                           is under no limitation or restriction to enter into
                           and carry out this Agreement and the Other Agreements
                           and to perform his or her obligations under them.

                  (b)      Validity of Agreement. The execution, delivery and
                           performance of this Agreement and the Other
                           Agreements by each corporate Franchisee and the
                           consummation by such Franchisees of the transactions
                           contemplated hereby has been duly authorized by all
                           requisite corporate action. No other corporate action
                           is necessary for the authorization, execution,
                           delivery and performance by such Franchisees of this
                           Agreement or any Other Agreements and the
                           consummation by such Franchisees of the transactions
                           contemplated hereby and thereby. This Agreement and
                           the Other Agreements have been duly executed and
                           delivered by each Franchisee and constitute the
                           legal, valid and binding obligations of such
                           Franchisee, enforceable against such Franchisee in
                           accordance with their terms.

                  (c)      No Approvals or Notices Required; No Conflict with
                           Instruments. The execution, delivery and performance
                           of this Agreement and the Other Agreements by each
                           Franchisee and the consummation by it of the
                           transactions contemplated hereby (i) will not violate
                           (with or without the giving of notice or the lapse of
                           time or both), or require any consent, approval,
                           filing or notice under any provision of any law, rule
                           or

                                       22
<PAGE>   23
                           regulation, court order, judgment or decree
                           applicable to such Franchisee, and (ii) will not
                           conflict with, or result in the breach or termination
                           of any provision of, or constitute a default under,
                           or result in the acceleration of the performance of
                           the obligations of such Franchisee, under, the
                           articles of incorporation or bylaws of such
                           Franchisee or any indenture, mortgage, deed of trust,
                           lease, licensing agreement, contract, instrument or
                           Other Agreement to which such Franchisee is a party
                           or by which such Franchisee or any of its assets or
                           properties is bound.

                  (d)      Acquisition for Own Account. Each Franchisee is
                           acquiring its Franchisee's Units for its own account
                           for investment and not with a view to the sale or
                           distribution thereof or with the present intention of
                           distributing or selling the same, or dividing any
                           such securities with any other person, except as may
                           be contemplated or permitted by that certain Limited
                           Liability Company Agreement of even date herewith by
                           and among the Franchisees and Old PUB. It is
                           specifically understood that (i) one or more of the
                           Franchisees may transfer and assign their respective
                           Franchisee's Units to other Franchisees soon after
                           the execution hereof and (ii) any such transfer and
                           assignment shall not be a violation of the
                           representation contained in the immediately preceding
                           sentence provided that the transferee Franchisees
                           reconfirm and affirm such representation with respect
                           to the Franchisee's Units so transferred to the
                           transferee Franchisees.

         4.3.     Survival of Representations and Warranties. The respective
                  representations and warranties of the parties contained herein
                  shall survive the execution and delivery of this Agreement and
                  the other Agreements at the Closing for a period of one (1)
                  year following the Effective Date (the "Survival Period").
                  Notwithstanding the right of the Franchisees to investigate
                  the Assets and the Publishing Business, the Franchisees shall
                  have the right to rely fully upon the representations,
                  warranties, covenants and agreements of TPRM and Old PUB
                  contained in this Agreement and pursue all rights and remedies
                  in connection therewith; unless as of the date hereof such
                  Franchisee has actual knowledge that any representations and
                  warranties of Old PUB and TPRM contained in this Agreement are
                  false or misleading in any material respect, in which
                  circumstance such Franchisee shall have no rights of reliance
                  or pursuance of remedies related to such representations

                                       23
<PAGE>   24
                  and warranties. Subject to Article 7, a claim for a breach of
                  a representation or warranty must be asserted by the
                  Indemnified Party (as hereinafter defined) prior to the
                  expiration of the Survival Period by providing the written
                  notice required by Section 7.4(a) below. In such event, the
                  Indemnifying Party's (as hereinafter defined) obligation under
                  the Agreement shall continue with respect to such claim until
                  resolution thereof.

5.       Deliveries at Closing.

         5.1.     Deliveries by Old PUB and TPRM. In addition to the instruments
                  and other items to be delivered by Old PUB to the Company at
                  the Closing pursuant to Section 1.3 above, concurrently with
                  the execution and delivery of this Agreement, Old PUB and TPRM
                  shall also execute (where appropriate) and deliver to the
                  Company and the Franchisees the following:

                  (a)      Authority and Proceedings. In a form reasonably
                           acceptable to the Franchisees, certified copies of
                           resolutions duly adopted by the Board of Directors
                           and shareholders of Old PUB and TPRM (which
                           resolutions shall be in full force and effect at the
                           time of delivery) authorizing the execution and
                           delivery and performance of this Agreement and the
                           Other Agreements and all transactions contemplated by
                           or incidental thereto, and such other instruments,
                           certificates and documents as the Franchisees shall
                           reasonably request.

                  (b)      Third Party Consents. All third party consents or
                           approvals, except for those the failure of which to
                           obtain would not have a material and adverse effect
                           on the Company.

         5.2.     Deliveries by the Franchisees. Concurrently with the execution
                  and delivery of this Agreement, the Franchisees shall execute
                  (where appropriate) and deliver to Old PUB, TPRM and the
                  Company the following:

                  (a)      Authority and Proceedings. For each corporate
                           Franchisee, in a form reasonably acceptable to Old
                           PUB, certified copies of resolutions duly adopted by
                           the Board of Directors of such Franchisee (which
                           resolutions shall be in full force and effect at the
                           time of delivery) authorizing the execution and
                           delivery and performance of this Agreement and the
                           Other Agreements and all transactions contemplated by
                           or incidental thereto, and

                                       24
<PAGE>   25
                           such other instruments, certificates and documents as
                           Old PUB shall reasonably request.

                  (b)      Franchise Addendum. Each Franchisee shall execute and
                           deliver to TPRM, an Addendum to its Franchise
                           Agreement with TPRM.

         5.3.     Additional Closing Documents and Actions. The following
                  additional actions shall take place concurrently with or prior
                  to the Closing:

                  (a)      Limited Liability Company Agreement. Old PUB and the
                           Franchisees shall adopt and execute and deliver to
                           each other the Limited Liability Company Agreement.

                  (b)      Issuance of Certificates. The Company shall issue to
                           Old PUB certificates representing the Old PUB Units
                           and shall issue to each Franchisee certificate(s)
                           representing the number of Franchisees Units set
                           forth opposite such Franchisee's name in Exhibit "A".

                  (c)      Contribution to Old PUB. Old PUB shall have received
                           an equity contribution of $200,000 either in the form
                           of a cash contribution from its current shareholders
                           or in the form of forgiveness of $200,000 of the
                           related party indebtedness identified on the March
                           31, 1995 unaudited balance sheet of Old PUB.

6.       Covenants; Action Subsequent to Closing.

         6.1.     Mail. Old PUB authorizes and empowers the Company on and after
                  the Effective Date to receive and open all mail received by
                  the Company relating to the Publishing Business or the Assets
                  and to deal with the contents of such communications in any
                  proper manner. Old PUB shall promptly deliver to the Company
                  any mail or other communication received by it after the
                  Effective Date pertaining to the Publishing Business or the
                  Assets and any cash, checks or other instruments of payment to
                  which the Company is entitled.

         6.2.     Third Party Consents. To the extent that Old PUB's rights
                  under any Contract or other Asset may not be transferred
                  without the consent or approval of another person which has
                  not been obtained at the Closing despite the exercise by Old
                  PUB of its reasonable best efforts, this Agreement shall not
                  constitute an agreement to transfer the same if an attempted
                  transfer would constitute a breach thereof or be unlawful, and
                  Old PUB at the Company's expense, shall use its reasonable
                  best efforts to obtain any such required consent or approval
                  as

                                       25
<PAGE>   26
                  promptly as possible. If any such consent or approval shall
                  not be obtained or if any attempted transfer would be
                  ineffective or impair the Company's right to the Assets in
                  question so that the Company would not in effect acquire the
                  benefit of all such rights, Old PUB, to the maximum extent
                  permitted by law, shall act after the Closing as the Company's
                  agent in order to obtain for the Company the benefits
                  thereunder, and shall cooperate, to the maximum extent
                  permitted by law, with the Company in any other reasonable
                  arrangements designed to provide such benefits to the Company.
                  Nothing contained in this Section 6.2 shall relieve Old PUB of
                  its obligations under any other provisions of this Agreement.

7.       Indemnification.

         7.1.     Indemnification by Old PUB and TPRM. Subject to the provisions
                  of this Section 7, Old PUB and TPRM shall, jointly and
                  severally, defend, indemnify and hold harmless the Company,
                  each Franchisee, each officer, director and agent of the
                  Company or a Franchisee and each person who controls the
                  Company or a Franchisee in respect of any material losses,
                  claims, damages, liabilities, deficiencies, delinquencies,
                  defaults, assessments, fees, penalties or related costs or
                  expenses, including, but not limited to, court costs and
                  attorneys', and accountants' fees and disbursements
                  (collectively referred to throughout this Agreement as
                  "Damages") to which the Company, each Franchisee, or any such
                  person may become subject if, and to the extent, such Damages
                  arise out of or are based upon: (i) the breach of any of the
                  representations, warranties, covenants or agreements made by
                  Old PUB or TPRM in this Agreement or any Other Agreement or
                  any certificate, document, schedule, instrument or Other
                  Agreement delivered in connection herewith or therewith and
                  (ii) any liability or other debts, obligations or contracts of
                  Old PUB or any of its affiliates, other than the Assumed
                  Liabilities.

         7.2.     Indemnification by the Company. Subject to the provisions of
                  this Section 7, the Company shall defend, shall indemnify and
                  hold harmless Old PUB and TPRM, each officer, director and
                  agent of Old PUB and each person who controls Old PUB or TPRM
                  in respect of any material Damages to which Old PUB, TPRM, or
                  any such person may become subject if, and to the extent, such
                  Damages arise out of or are based upon the Company's
                  obligation for the Assumed Liabilities.

                                       26
<PAGE>   27
         7.3.     Indemnification by the Franchisees. Each of the Franchisees,
                  severally, but not jointly, shall indemnify and hold harmless,
                  Old PUB, TPRM, the Company, each officer, director and agent
                  of Old PUB, the Company and TPRM, and each person who controls
                  Old PUB, the Company and TPRM in respect of any material
                  Damages to which Old PUB, the Company, TPRM, or any such
                  person may become subject if, and to the extent, such Damages
                  arise out of or are based upon the breach of any
                  representations and warranties, covenants or agreements made
                  by such Franchisees in this Agreement or any Other Agreement
                  or any certificate, document, schedule, instrument or Other
                  Agreement executed in connection herewith or therewith.

         7.4.     Indemnification Procedures. The obligations and liabilities of
                  each indemnifying party hereunder with respect to claims
                  resulting from the assertion of liability by the other party
                  or third parties shall be subject to the following terms and
                  conditions:

                  (a)      If any person shall notify an indemnified party (the
                           "Indemnified Party") with respect to any matter (a
                           "Claim") which may give rise to a claim for
                           indemnification against Old PUB (or TPRM), the
                           Company or one or more of the Franchisees (the
                           "Indemnifying Party") under this Section 7, then the
                           Indemnified Party shall promptly notify each
                           Indemnifying Party thereof in writing; provided,
                           however, that no delay on the part of the Indemnified
                           Party in notifying any Indemnifying Party shall
                           relieve the Indemnifying Party from any obligation
                           hereunder unless (and then solely to the extent) the
                           Indemnifying Party thereby is prejudiced.

                  (b)      Any Indemnifying Party will have the right to defend
                           the Indemnified Party against the Claim with counsel
                           of its choice reasonably satisfactory to the
                           Indemnified Party so long as (A) the Indemnifying
                           Party notifies the Indemnified Party in writing
                           within 15 days after the Indemnified Party has given
                           notice of the Claim that the Indemnifying Party will
                           indemnify the Indemnified Party from and against the
                           entirety (subject to any limitations contained in
                           Section 7) of any Damages the Indemnified Party may
                           suffer resulting from, arising out of, relating to,
                           in the nature of or caused by the Claim, (B) the
                           Indemnifying Party provides the Indemnified Party
                           with evidence reasonably acceptable to the
                           Indemnified Party that the Indemnifying Party will
                           have the financial resources to defend against

                                       27
<PAGE>   28
                           the Claim and fulfill its indemnification obligations
                           hereunder, (C) the Claim involves only money damages
                           and does not seek an injunction or other equitable
                           relief, (D) settlement of, or an adverse judgment
                           with respect to, the Claim is not, in the good faith
                           judgment of the Indemnifying Party, likely to
                           establish a precedential custom or practice
                           materially adverse to the continuing business
                           interests of the Indemnified Party, and (E) the
                           Indemnifying Party conducts the defense of the Claim
                           actively and diligently.

                  (c)      So long as the Indemnifying Party is conducting the
                           defense of the Claim in accordance with Section
                           7.4(b) above, (A) the Indemnified Party may retain
                           separate co-counsel at its sole cost and expense and
                           participate in the defense of the Claim, (B) the
                           Indemnified Party will not consent to the entry of
                           any judgment or enter into any settlement with
                           respect to the Claim without the prior written
                           consent of the Indemnifying Party (not to be withheld
                           unreasonably), and (C) the Indemnifying Party will
                           not consent to the entry of any judgment or enter
                           into any settlement with respect to the Claim without
                           the prior written consent of the Indemnified Party
                           (not to be withheld unreasonably).

                  (d)      In the event any of the conditions in Section 7.4(b)
                           above is or becomes unsatisfied, however, (A) the
                           Indemnified Party may defend against, and, upon
                           notice to the Indemnifying Party, consent to the
                           entry of any judgment or enter into any settlement
                           with respect to, the Claim in any manner it
                           reasonably may deem appropriate (and the Indemnified
                           Party need not consult with, or obtain any consent
                           from, any Indemnifying Party in connection
                           therewith), (B) the Indemnifying Party will remain
                           responsible for any damages the Indemnified Party may
                           suffer resulting from, arising out of, relating to,
                           in the nature of, or caused by the Claim to the
                           fullest extent provided in this Section 7.

8.       Miscellaneous.

         8.1.     Public Announcements. Prior to the Effective Date, no news
                  release or other public announcement pertaining in any way to
                  the transactions contemplated by this Agreement will be made
                  by any party hereto except in accordance with the terms of
                  this Agreement.

                                       28
<PAGE>   29
         8.2.     Expenses. Except as otherwise specifically provided for herein
                  or in that certain letter agreement dated March 17, 1995 and
                  signed by Michael F. Rogers and TPRM, each of the parties
                  hereto shall pay the fees and expenses incurred by it in
                  connection with the negotiation, preparation, execution and
                  performance of this Agreement and the Other Agreements,
                  including, without limitation, attorneys' fees and
                  accountants' fees.

         8.3.     Notices. All notices, offers, approvals, elections, consents,
                  acceptances, waivers, reports, requests and other
                  communications required or permitted to be given hereunder
                  (all of the foregoing hereinafter collectively referred to as
                  "Communications") shall be in writing and shall be deemed to
                  have been duly given if delivered personally with receipt
                  acknowledged or sent by registered or certified mail or
                  equivalent, if available, return receipt requested, or by
                  facsimile (with an appropriate answer back code), telex or
                  cablegram (which shall be confirmed by a writing sent by
                  registered or certified mail or equivalent on the same day
                  that such facsimile, telex or cablegram is sent), or by
                  recognized overnight courier for next day delivery, addressed
                  or sent to the parties at the following addresses and
                  facsimile numbers or to such other or additional address or
                  facsimile numbers or to such other or additional address or
                  facsimile number as any party shall hereafter specify by
                  Communication to the other parties:

                  TPRM:             The Princeton Review Management Corp.
                                    2315 Broadway
                                    New York, New York 10024
                                    Fax No. (212) 874-0775
                                    Attention: Mr. John Katzman

                  WITH A COPY TO:   Mr. John P. Schmitt
                                    Patterson, Belknap, Webb & Tyler LLP
                                    1133 Avenue of the Americas
                                    New York, New York 10036-6710
                                    Fax No. (212) 336-2222

                  OLD PUB:          The Princeton Review Publishing Co., Inc.
                                    2315 Broadway
                                    New York, New York 10024
                                    Fax No. (212) 874-0775
                                    Attention: Mr. John Katzman

                                       29
<PAGE>   30
                  WITH A COPY TO:   Mr. John P. Schmitt
                                    Patterson, Belknap, Webb & Tyler LLP
                                    1133 Avenue of the Americas
                                    New York, New York 10036-6710
                                    Fax No. (212) 336-2222

                  THE COMPANY:      The Princeton Review Publishing Company,
                                    L.L.C.
                                    2315 Broadway
                                    New York, New York 10024
                                    Fax No. (212) 874-0775
                                    Attention: Mr. John Katzman

                  WITH A COPY TO:   Mr. Michael F. Rogers
                                    Sewell & Riggs A Professional Corporation
                                    333 Clay Avenue, Suite 800
                                    Houston, Texas  77002
                                    Fax No. (713) 652-8808
                                    (OR SUCH OTHER PARTY AS MAY BE
                                    DESIGNATED BY THE FRANCHISEES)

                  WITH A COPY TO:   Mr. John P. Schmitt
                                    Patterson, Belknap, Webb & Tyler LLP
                                    1133 Avenue of the Americas
                                    New York, New York 10036-6710
                                    Fax No. (212) 336-2222

                  FRANCHISEES:      See addresses for Each Franchisee on such
                                    Franchisee's separate signature page

                  WITH A COPY TO:   Mr. Michael F. Rogers
                                    Sewell & Riggs A Professional Corporation
                                    333 Clay Avenue, Suite 800
                                    Houston, Texas  77002
                                    Fax No. (713) 652-8808
                                    (OR SUCH OTHER PARTY AS MAY BE
                                    DESIGNATED BY THE FRANCHISEES)

         Notice of change of address shall be deemed given when actually
         received or upon refusal to accept delivery thereof; all other
         Communications shall be deemed to have been given, received and dated
         on the earlier of: (i) when actually received or upon refusal to accept
         delivery thereof; or (ii) on the date when delivered personally, one
         (1) day after being sent by facsimile, cable, telex or overnight
         courier and four (4) business days after mailing, as aforesaid.

                                       30
<PAGE>   31
         8.4.     New York Law to Apply. This Agreement shall be construed under
                  and in accordance with the laws of the State of New York
                  without giving effect to the choice of law provisions thereof.

         8.5.     Section Headings; Index. The section headings contained in
                  this Agreement are for reference purposes only and shall not
                  affect the meaning or interpretation of this Agreement.

         8.6.     Legal Construction. In case any one or more of the provisions
                  contained in this Agreement shall be invalid or unenforceable
                  in any respect, the validity and enforceability of the
                  remaining provisions contained herein shall not in any way be
                  affected or impaired thereby and the parties will attempt to
                  agree upon a valid and enforceable provision which shall be a
                  reasonable substitute for such invalid and unenforceable
                  provision in light of the tenor of this Agreement and, upon so
                  agreeing, shall incorporate such substitute provision in this
                  Agreement.

         8.7.     Counterparts. This Agreement may be executed in any number of
                  counterparts and each of such counterparts shall for all
                  purposes be deemed to be an original. Each of the Franchisees
                  shall execute a separate signature page in the form attached
                  hereto. By executing a separate signature page in the form
                  attached hereto, each Franchisee hereby authorizes and agrees
                  that such separately executed signature page may be appended
                  to the original counterparts of this Agreement to become a
                  part thereof.

         8.8.     Gender. Wherever the context shall so require, all words
                  herein in the male gender shall be deemed to include the
                  female or neuter gender, all singular words shall include the
                  plural, and all plural words shall include the singular.

         8.9.     Binding Effect; Benefit. This Agreement shall inure to the
                  benefit of and be binding upon the parties hereto and their
                  respective permitted successors and assigns. Nothing in this
                  Agreement, expressed or implied, is intended to confer on any
                  person other than the parties hereto or their respective
                  permitted successors and assigns, any rights, remedies,
                  obligations or liabilities under or by reason of this
                  Agreement.

         8.10.    Assignability. Neither TPRM or any Franchisee shall be
                  entitled to assign this Agreement except to a transferee which
                  has acquired all of such party's shares in the Company in a
                  manner permitted by the Limited Liability Company

                                       31
<PAGE>   32
                  Agreement, and no such assignment shall release the
                  transferring party from any of its obligations or duties under
                  this Agreement.

         8.11.    Arbitration.

                  (a)      Requirement. All claims, controversies disputes and
                           other matters in question arising out of, or relating
                           to this Agreement, the breach hereof or the rights,
                           privileges, responsibilities or duties between or
                           among any one or more of the parties bound by this
                           Agreement, shall be decided by arbitration in
                           Atlanta, Georgia in accordance with the Commercial
                           Arbitration Rules of the AAA then existing unless all
                           of the parties to such claim, controversy or dispute
                           or other matter in question unanimously agree to the
                           contrary. The provisions contained in this Section
                           8.11 shall be specifically enforceable under the
                           prevailing arbitration law.

                  (b)      Timeliness. The demand for arbitration shall be made
                           within a reasonable time after the claim, dispute or
                           other matter in question has arisen, and in no event
                           shall it be made when institution of legal or
                           equitable proceedings based on such claim, dispute or
                           other matter in question would be barred by the
                           applicable statute of limitations.

                  (c)      Procedure. The arbitrator or arbitrators for any
                           proceeding conducted hereunder shall be selected in
                           accordance with the commercial arbitration rules of
                           the AAA. The award rendered by the arbitrator or
                           arbitrators shall be final, and judgment may entered
                           upon it in accordance with applicable law and any
                           court having jurisdiction thereover, the parties
                           hereto consenting to the jurisdiction of such courts
                           for this purpose.

                  (d)      Costs. Except as provided to the contrary herein, the
                           fees and expenses related to the services provided by
                           the arbitrators and the AAA in connection with any
                           arbitration proceeding hereunder shall be paid
                           one-half by each party to such arbitration
                           proceeding. Notwithstanding the foregoing, the
                           prevailing party in any arbitration proceeding
                           conducted hereunder shall be promptly reimbursed by
                           the other party for all attorneys' fees reasonably
                           incurred by the prevailing party in such arbitration
                           proceeding and all fees and expenses paid by such
                           prevailing party for the services rendered by the
                           arbitrators and the AAA.

                                       32
<PAGE>   33
         8.12.    Entire Agreement, Modification, Consents and Waivers. This
                  Agreement (including the Schedules and Exhibits hereto and the
                  certificates to be delivered in connection herewith) and all
                  of the other documents, instruments, letters and agreements
                  executed effective of even date herewith contains the entire
                  agreement of the parties with respect to the subject matter
                  thereof. No interpretation, change, termination or waiver of
                  or extension of time for the performance under any provision
                  of this Agreement shall be binding upon any party unless in
                  writing and signed by the party intended to be bound thereby.
                  Receipt by any party of money or other consideration due under
                  this Agreement, or the Closing of the transactions
                  contemplated hereby, with or without knowledge of breach,
                  shall not constitute a waiver of such breach or any provision
                  of this Agreement. Except as otherwise provided in this
                  Agreement, no waiver of or other failure to exercise any right
                  under, or default or extension of time for performance under,
                  any provision of this Agreement shall affect the right of any
                  party to exercise any subsequent right under or otherwise
                  enforce said provision or any other provision hereof or to
                  exercise any right or remedy in the event of any other
                  default, whether or not similar.

9.       Special Provisions.

         9.1.     Rights upon Reconstitution of Publishing Business. If the TPRM
                  License should ever terminate or expire, for whatever reason,
                  and TPRM (or any person that controls, is controlled by or is
                  under common control with TPRM) should thereafter elect to
                  continue the Publishing Business, then TPRM and the
                  Franchisees shall each have the following rights and
                  obligations:

                  (a)      TPRM (i) must conduct the Publishing Business, or
                           cause the Publishing Business to be conducted,
                           through a new corporation or limited liability
                           company ("new publishing company") pursuant to a
                           license agreement similar to the License Agreement,
                           (ii) shall cause each of the Franchisees (or the
                           assignee of such Franchisee's rights under this
                           Section 9.1(a)) to receive the same percentage
                           ownership interest in the new publishing company,
                           simultaneously with the initial issuance of the new
                           publishing company's stock, which such Franchisee
                           owned on the formation of the Company and (iii) shall
                           cause the owner or owners of all other ownership

                                       33
<PAGE>   34
                           interests of the new publishing company to enter into
                           an agreement, simultaneously with the initial
                           issuance of the new publishing company's ownership
                           interests, in a form and content substantially
                           similar to the Limited Liability Company Agreement
                           being entered into of even date herewith in regard to
                           the ownership interests of the Company.

                  (b)      The Franchisees shall (i) make the agreement
                           contained in Section 2 hereof at such time for the
                           benefit of the new publishing company, (ii) execute
                           such other documents as may be necessary to reflect
                           that the new publishing company will enjoy all other
                           privileges and benefits conferred upon the Company
                           pursuant to this Agreement and (iii) execute and
                           enter into, or, if applicable, cause the assignee of
                           Franchisee's rights under this Section 9.1 to execute
                           and enter into, the agreement referred to clause
                           (iii) of Section 9.1(a) hereof.

         At the option of each Franchisee, the rights contained in this Section
         9.1 may be sold, transferred or assigned only together with such
         Franchisee's units of membership interests in the Company.

         9.2.     Intentionally Omitted.

         9.3.     Transfer by Certain Franchisees to Affiliates. Immediately
                  upon completion of the transactions contemplated hereby,
                  certain of the Franchisees shall, and hereby do, transfer,
                  assign and convey (i) such Franchisee's units of non-voting
                  membership interests in the Company issued pursuant to this
                  Agreement and (ii) all of the rights of such Franchisee under
                  Section 9.1 hereof to the person designated next to such
                  Franchisee's name on Exhibit "A" attached hereto as such
                  Franchisee's "Immediate Transferee." All Immediate
                  Transferee's of a Franchisee shall be an affiliate of such
                  Franchisee. If there is no Immediate Transferee designated
                  next to any Franchisee's name on Exhibit "A" attached hereto,
                  then such Franchisee is not transferring its units of
                  non-voting membership interests in the Company issued pursuant
                  to this Agreement to any person pursuant to the provisions of
                  this Section 9.3. To avoid unnecessary issuance and
                  cancellation of certificates, the initial certificates
                  evidencing those units of non-voting membership interests in
                  the Company being issued to the Franchisees who are
                  transferring those shares to an Immediate Transferee, may be
                  initially issued to the Immediate Transferee.

                                       34
<PAGE>   35
         9.4.     Intentionally omitted

         9.5.     Franchisees' Legal Fees. Reference is made to the fact that
                  some of the Franchisees ("Fronting Franchisees") have incurred
                  and paid certain legal fees ("Franchisee Legal Fees") in
                  connection with the negotiation and preparation of this
                  Agreement and certain other documents and agreements being
                  executed of even date herewith. As a condition precedent to
                  each Franchisee's right to receive the number of units of
                  non-voting membership interests indicated on Exhibit "A"
                  attached hereto, such Franchisee shall remit to the Company on
                  behalf of the Fronting Franchisees, an amount equal to $28.00
                  multiplied by the number of units of non-voting membership
                  interests to be issued to such Franchisee. Each of the
                  Fronting Franchisees shall be entitled to a credit against
                  such amount payable pursuant to this Section 9.5 in the amount
                  which such Fronting Franchisee has actually paid through the
                  Closing toward the Franchisee Legal Fees. All amounts
                  collected by the Company pursuant to this Section 9.5 shall be
                  paid to the Fronting Franchisees in reimbursement of the
                  Franchisee Legal Fees paid by each of them or for which they
                  are obligated. If the total amount collected pursuant to this
                  Section 9.5 exceeds the total amount of Franchisee Legal Fees,
                  then the excess shall be refunded to the Franchisees by the
                  Company in proportion to the number of units of non-voting
                  membership interests owned by each of them. Company agrees and
                  covenants, for the benefit of the Fronting Franchisees, that
                  it will not issue the certificate representing Franchisee's
                  units of non-voting membership interests until it has received
                  payment of the amount required pursuant to the provisions
                  hereof from such Franchisee.

         9.6.     Legend Requirement. The Certificates representing the Old PUB
                  Units and the Franchisees Units shall bear the following
                  legend:

                           THE UNITS REPRESENTED HEREBY HAVE NOT BEEN REGISTERED
                           UNDER THE SECURITIES ACT OF 1933 OR APPLICABLE STATE
                           SECURITIES LAWS AND MAY NOT BE SOLD OR TRANSFERRED IN
                           THE ABSENCE OF SUCH REGISTRATION OR EXEMPTION
                           THEREFROM UNDER SAID ACT AND APPLICABLE STATE
                           SECURITIES LAWS.

         The Franchisees and Old Pub further agree and covenant that they shall
         not make any transfer or assignment of any units of membership
         interests in the Company issued to

                                       35
<PAGE>   36
         them if such transfer or assignment would be in violation of any
         federal or state securities or other law or that would cause the
         Company to be in such violation.

         IN WITNESS WHEREOF, the parties hereto have executed and delivered this
Agreement effective as of the Effective Date.

                                    THE PRINCETON REVIEW MANAGEMENT CORP.

                                    By:    /s/ John Katzman
                                       -----------------------------------------
                                    Name:   John Katzman
                                         ---------------------------------------
                                    Title:  President
                                          --------------------------------------
                                                                     TPRM

                                    THE PRINCETON REVIEW PUBLISHING
                                        COMPANY, L.L.C..

                                    By:    /s/ John Katzman
                                       -----------------------------------------
                                    Name:   John Katzman
                                         ---------------------------------------
                                    Title:  President
                                          --------------------------------------
                                                                     THE COMPANY

                                    THE PRINCETON REVIEW PUBLISHING CO., INC.

                                    By:    /s/ John Katzman
                                       -----------------------------------------
                                    Name:   John Katzman
                                         ---------------------------------------
                                    Title:  President
                                          --------------------------------------
                                                                     OLD
                                                                     PUB

                                       36
<PAGE>   37
                             FRANCHISEE JOINDER TO

                               FORMATION AGREEMENT

         By executing in the space provided below, the Franchisee identified
below acknowledges having received and read, and agrees to become a party to,
and be bound by, the Formation Agreement dated effective May 31, 1995 by and
among The Princeton Review Publishing Company, L.L.C., The Princeton Review
Publishing Co., Inc., The Princeton Review Management Corporation and the other
independent The Princeton Review franchisees identified on exhibit "A" attached
thereto

Printed Name of Franchisee:
                           -----------------------------------------------------

Signature of Franchisee or
  Authorized Officer of
  Franchisee:
             -------------------------------------------------------------------

Printed Name of Officer
  (if applicable):
                  --------------------------------------------------------------

Address for Notice:
                   -------------------------------------------------------------

                                       37
<PAGE>   38
                                   EXHIBIT "A"

<TABLE>
<CAPTION>
                                   Immediate                Number of Units
Name of                            Transferee               of Non-Voting
Franchisee                         (if any)                 Membership
----------                         --------                 ----------
<S>                                <C>                      <C>
Amherst                                                     29.74
Anaheim                                                     118.4
Boston                                                      160.73
Chapel Hill                                                 27.66
Charlotte                                                   6.82
Cleveland                                                   25.68
Denver                                                      41.44
Detroit                                                     48.06
Fairfield                                                   56.99
Gainsville                                                  13.94
Los Angeles                                                 205.45
Miami                                                       58.59
New Hampshire                                               22.4
New Jersey                                                  355.16
New Orleans                                                 6.29
Oklahoma                                                    3.12
Phoenix                                                     24.19
Pittsburgh                                                  25.1
Puerto Rico                                                 4.26
Rhode Island                                                20.81
St. Louis                                                   25.17
San Diego                                                   38.31
San Jose                                                    79.54
Tennessee                                                   11.1
Texas                                                       230.76
Utah                                                        5.25
Westchester                                                 79.31
San Francisco                                               36.62
</TABLE>

                                       38
<PAGE>   39
                              FRANCHISEE JOINDER TO
                               FORMATION AGREEMENT

         By executing in the space provided below, the Franchisee identified
below acknowledges having received and read, and agrees to become a party to,
and be bound by, the Formation Agreement dated effective May 31, 1995 by and
among The Princeton Review Publishing Company, L.L.C., The Princeton Review
Publishing Co., Inc., The Princeton Review Management Corporation and the other
independent The Princeton Review franchisees identified on exhibit "A" attached
thereto

Printed Name of Franchisee: Charles F. Emmons & Charles F. Emmons, Jr., Jointly
                           -----------------------------------------------------

Signature of Franchisee or
  Authorized Officer of
  Franchisee: /s/ Charles F. Emmons & /s/ Charles F. Emmons, Jr., Jointly
             -------------------------------------------------------------------

Printed Name of Officer
  (if applicable): Charles F. Emmons & Charles F. Emmons, Jr.
                  --------------------------------------------------------------

Address for Notice:  P.O.Box  390
                   -------------------------------------------------------------
                     Florence, MA  01060
                   -------------------------------------------------------------
<PAGE>   40
                              FRANCHISEE JOINDER TO
                               FORMATION AGREEMENT

         By executing in the space provided below, the Franchisee identified
below acknowledges having received and read, and agrees to become a party to,
and be bound by, the Formation Agreement dated effective May 31, 1995 by and
among The Princeton Review Publishing Company, L.L.C., The Princeton Review
Publishing Co., Inc., The Princeton Review Management Corporation and the other
independent The Princeton Review franchisees identified on exhibit "A" attached
thereto

Printed Name of Franchisee: Princeton Review of Boston, Inc.
                           -----------------------------------------------------

Signature of Franchisee or
  Authorized Officer of
  Franchisee: /s/ Matthew Rosenthal
             -------------------------------------------------------------------

Printed Name of Officer
  (if applicable): Matthew Rosenthal
                  --------------------------------------------------------------

Address for Notice:  57 Union Street, # 1
                   -------------------------------------------------------------
                     Newton,  MA  02159
                   -------------------------------------------------------------
<PAGE>   41
                              FRANCHISEE JOINDER TO
                               FORMATION AGREEMENT

         By executing in the space provided below, the Franchisee identified
below acknowledges having received and read, and agrees to become a party to,
and be bound by, the Formation Agreement dated effective May 31, 1995 by and
among The Princeton Review Publishing Company, L.L.C., The Princeton Review
Publishing Co., Inc., The Princeton Review Management Corporation and the other
independent The Princeton Review franchisees identified on exhibit "A" attached
thereto

Printed Name of Franchisee: Princeton Review of Orange County, Inc..
                           -----------------------------------------------------

Signature of Franchisee or
  Authorized Officer of
  Franchisee: /s/ Paul Kanarek
             -------------------------------------------------------------------

Printed Name of Officer
  (if applicable): Paul Kanarek
                  --------------------------------------------------------------

Address for Notice:  The Princeton Review
                   -------------------------------------------------------------
                     215 Michelson Drive #280
                   -------------------------------------------------------------
                     Irvine,  CA  92715
                   -------------------------------------------------------------
<PAGE>   42
                              FRANCHISEE JOINDER TO
                               FORMATION AGREEMENT

         By executing in the space provided below, the Franchisee identified
below acknowledges having received and read, and agrees to become a party to,
and be bound by, the Formation Agreement dated effective May 31, 1995 by and
among The Princeton Review Publishing Company, L.L.C., The Princeton Review
Publishing Co., Inc., The Princeton Review Management Corporation and the other
independent The Princeton Review franchisees identified on exhibit "A" attached
thereto

Printed Name of Franchisee: Patricia Krebs
                           -----------------------------------------------------

Signature of Franchisee or
  Authorized Officer of
  Franchisee: /s/ Patricia Krebs
             -------------------------------------------------------------------

Printed Name of Officer
  (if applicable): Patricia Krebs
                  --------------------------------------------------------------

Address for Notice:  1829 E. Franklin Street, #600
                   -------------------------------------------------------------
                     Chapel Hill, NC  27514
                   -------------------------------------------------------------
<PAGE>   43
                              FRANCHISEE JOINDER TO
                               FORMATION AGREEMENT

         By executing in the space provided below, the Franchisee identified
below acknowledges having received and read, and agrees to become a party to,
and be bound by, the Formation Agreement dated effective May 31, 1995 by and
among The Princeton Review Publishing Company, L.L.C., The Princeton Review
Publishing Co., Inc., The Princeton Review Management Corporation and the other
independent The Princeton Review franchisees identified on exhibit "A" attached
thereto

Printed Name of Franchisee: Eric B. Moore
                           -----------------------------------------------------

Signature of Franchisee or
  Authorized Officer of
  Franchisee: /s/ Eric B. Moore
             -------------------------------------------------------------------

Printed Name of Officer
  (if applicable): Eric B. Moore
                  --------------------------------------------------------------

Address for Notice:  1206 Providence Road
                   -------------------------------------------------------------
                     Charlotte, NC  28207
                   -------------------------------------------------------------
<PAGE>   44
                              FRANCHISEE JOINDER TO
                               FORMATION AGREEMENT

         By executing in the space provided below, the Franchisee identified
below acknowledges having received and read, and agrees to become a party to,
and be bound by, the Formation Agreement dated effective May 31, 1995 by and
among The Princeton Review Publishing Company, L.L.C., The Princeton Review
Publishing Co., Inc., The Princeton Review Management Corporation and the other
independent The Princeton Review franchisees identified on exhibit "A" attached
thereto

Printed Name of Franchisee: The Princeton Review - Peninsula, Inc.
                           -----------------------------------------------------

Signature of Franchisee or
  Authorized Officer of
  Franchisee: /s/ Pamela N. Hirsch
             -------------------------------------------------------------------

Printed Name of Officer
  (if applicable): Pamela N. Hirsch
                  --------------------------------------------------------------

Address for Notice:  6849 Camden Ave., # 106
                   -------------------------------------------------------------
                     San Jose, CA 95120
                   -------------------------------------------------------------
<PAGE>   45
                              FRANCHISEE JOINDER TO
                               FORMATION AGREEMENT

         By executing in the space provided below, the Franchisee identified
below acknowledges having received and read, and agrees to become a party to,
and be bound by, the Formation Agreement dated effective May 31, 1995 by and
among The Princeton Review Publishing Company, L.L.C., The Princeton Review
Publishing Co., Inc., The Princeton Review Management Corporation and the other
independent The Princeton Review franchisees identified on exhibit "A" attached
thereto

Printed Name of Franchisee: Test Services, Inc.
                           -----------------------------------------------------

Signature of Franchisee or
  Authorized Officer of
  Franchisee: /s/ Michael A. Bjornstad
             -------------------------------------------------------------------

Printed Name of Officer
  (if applicable): Michael A. Bjornstad
                  --------------------------------------------------------------

Address for Notice:  7350 N. Broadway
                   -------------------------------------------------------------
                     Denver, CO  80221
                   -------------------------------------------------------------
<PAGE>   46
                              FRANCHISEE JOINDER TO
                               FORMATION AGREEMENT

         By executing in the space provided below, the Franchisee identified
below acknowledges having received and read, and agrees to become a party to,
and be bound by, the Formation Agreement dated effective May 31, 1995 by and
among The Princeton Review Publishing Company, L.L.C., The Princeton Review
Publishing Co., Inc., The Princeton Review Management Corporation and the other
independent The Princeton Review franchisees identified on exhibit "A" attached
thereto

Printed Name of Franchisee: Lecamp Co. Inc.
                           -----------------------------------------------------

Signature of Franchisee or
  Authorized Officer of
  Franchisee: /s/ Lloyd Eric Cotsen
             -------------------------------------------------------------------

Printed Name of Officer
  (if applicable): Lloyd Eric Cotsen
                  --------------------------------------------------------------

Address for Notice:  1880 Veteran Avenue (#310)
                   -------------------------------------------------------------
                     Los Angeles, CA  90025
                   -------------------------------------------------------------
<PAGE>   47
                              FRANCHISEE JOINDER TO
                               FORMATION AGREEMENT

         By executing in the space provided below, the Franchisee identified
below acknowledges having received and read, and agrees to become a party to,
and be bound by, the Formation Agreement dated effective May 31, 1995 by and
among The Princeton Review Publishing Company, L.L.C., The Princeton Review
Publishing Co., Inc., The Princeton Review Management Corporation and the other
independent The Princeton Review franchisees identified on exhibit "A" attached
thereto

Printed Name of Franchisee:The Princeton Review of New Hampshire and Maine, Inc.
                           -----------------------------------------------------

Signature of Franchisee or
  Authorized Officer of
  Franchisee: /s/ Matthew Rosenthal
             -------------------------------------------------------------------

Printed Name of Officer
  (if applicable): Matthew Rosenthal
                  --------------------------------------------------------------

Address for Notice:  57 Union Street, #1
                   -------------------------------------------------------------
                     Newton, MA  02159
                   -------------------------------------------------------------
<PAGE>   48
                              FRANCHISEE JOINDER TO
                               FORMATION AGREEMENT

         By executing in the space provided below, the Franchisee identified
below acknowledges having received and read, and agrees to become a party to,
and be bound by, the Formation Agreement dated effective May 31, 1995 by and
among The Princeton Review Publishing Company, L.L.C., The Princeton Review
Publishing Co., Inc., The Princeton Review Management Corporation and the other
independent The Princeton Review franchisees identified on exhibit "A" attached
thereto

Printed Name of Franchisee: The Princeton Review of New Jersey, Inc.
                           -----------------------------------------------------

Signature of Franchisee or
  Authorized Officer of
  Franchisee: /s/ Robert Cohen
             -------------------------------------------------------------------

Printed Name of Officer
  (if applicable): Robert Cohen
                  --------------------------------------------------------------

Address for Notice:  252 Nassau Street
                   -------------------------------------------------------------
                     Princeton, NJ  08542
                   -------------------------------------------------------------
<PAGE>   49
                              FRANCHISEE JOINDER TO
                               FORMATION AGREEMENT

         By executing in the space provided below, the Franchisee identified
below acknowledges having received and read, and agrees to become a party to,
and be bound by, the Formation Agreement dated effective May 31, 1995 by and
among The Princeton Review Publishing Company, L.L.C., The Princeton Review
Publishing Co., Inc., The Princeton Review Management Corporation and the other
independent The Princeton Review franchisees identified on exhibit "A" attached
thereto

Printed Name of Franchisee: The Princeton Review of Pittsburgh, Inc.
                           -----------------------------------------------------

Signature of Franchisee or
  Authorized Officer of
  Franchisee: /s/ Audrey Olmer
             -------------------------------------------------------------------

Printed Name of Officer
  (if applicable): Audrey Olmer
                  --------------------------------------------------------------

Address for Notice:  P.O. Box 81123
                   -------------------------------------------------------------
                     Pittsburgh, PA  15217
                   -------------------------------------------------------------
<PAGE>   50
                              FRANCHISEE JOINDER TO
                               FORMATION AGREEMENT

         By executing in the space provided below, the Franchisee identified
below acknowledges having received and read, and agrees to become a party to,
and be bound by, the Formation Agreement dated effective May 31, 1995 by and
among The Princeton Review Publishing Company, L.L.C., The Princeton Review
Publishing Co., Inc., The Princeton Review Management Corporation and the other
independent The Princeton Review franchisees identified on exhibit "A" attached
thereto

Printed Name of Franchisee: The Princeton Review of RI, Inc.
                           -----------------------------------------------------

Signature of Franchisee or
  Authorized Officer of
  Franchisee: /s/ Paul M. Stouber
             -------------------------------------------------------------------

Printed Name of Officer
  (if applicable): Paul M. Stouber
                  --------------------------------------------------------------

Address for Notice:  125 Thayer Street
                   -------------------------------------------------------------
                     Providence, RI  02906
                   -------------------------------------------------------------
<PAGE>   51
                              FRANCHISEE JOINDER TO
                               FORMATION AGREEMENT

         By executing in the space provided below, the Franchisee identified
below acknowledges having received and read, and agrees to become a party to,
and be bound by, the Formation Agreement dated effective May 31, 1995 by and
among The Princeton Review Publishing Company, L.L.C., The Princeton Review
Publishing Co., Inc., The Princeton Review Management Corporation and the other
independent The Princeton Review franchisees identified on exhibit "A" attached
thereto

Printed Name of Franchisee: The Princeton Review of St. Louis, Inc.
                           -----------------------------------------------------

Signature of Franchisee or
  Authorized Officer of
  Franchisee: /s/ Wm Lindsley
             -------------------------------------------------------------------

Printed Name of Officer
  (if applicable): Wm Lindsley
                  --------------------------------------------------------------

Address for Notice:  9666 Olive Boulevard, Suite 140
                   -------------------------------------------------------------
                     St. Louis, Missouri  63132-3019
                   -------------------------------------------------------------
<PAGE>   52
                              FRANCHISEE JOINDER TO
                               FORMATION AGREEMENT

         By executing in the space provided below, the Franchisee identified
below acknowledges having received and read, and agrees to become a party to,
and be bound by, the Formation Agreement dated effective May 31, 1995 by and
among The Princeton Review Publishing Company, L.L.C., The Princeton Review
Publishing Co., Inc., The Princeton Review Management Corporation and the other
independent The Princeton Review franchisees identified on exhibit "A" attached
thereto

Printed Name of Franchisee: The Kafiristan Blokes
                           -----------------------------------------------------

Signature of Franchisee or
  Authorized Officer of
  Franchisee: /s/ F. Wade McKinney/Stephen A. Leake
             -------------------------------------------------------------------

Printed Name of Officer
  (if applicable): The Princeton Review
                  --------------------------------------------------------------

Address for Notice:  3508 Belmont Blvd.
                   -------------------------------------------------------------
                     Nashville, TN  37215
                   -------------------------------------------------------------
<PAGE>   53
                              FRANCHISEE JOINDER TO
                               FORMATION AGREEMENT

         By executing in the space provided below, the Franchisee identified
below acknowledges having received and read, and agrees to become a party to,
and be bound by, the Formation Agreement dated effective May 31, 1995 by and
among The Princeton Review Publishing Company, L.L.C., The Princeton Review
Publishing Co., Inc., The Princeton Review Management Corporation and the other
independent The Princeton Review franchisees identified on exhibit "A" attached
thereto

Printed Name of Franchisee: TS. TS, Inc.
                           -----------------------------------------------------

Signature of Franchisee or
  Authorized Officer of
  Franchisee: /s/ Rob Case/Kevin Campbell
             -------------------------------------------------------------------

Printed Name of Officer
  (if applicable): Rob Case Kevin Campbell
                  --------------------------------------------------------------

Address for Notice:  701 N. Post Oak Road, #8
                   -------------------------------------------------------------
                     Houston, TX  77024
                   -------------------------------------------------------------
<PAGE>   54
                              FRANCHISEE JOINDER TO
                               FORMATION AGREEMENT

         By executing in the space provided below, the Franchisee identified
below acknowledges having received and read, and agrees to become a party to,
and be bound by, the Formation Agreement dated effective May 31, 1995 by and
among The Princeton Review Publishing Company, L.L.C., The Princeton Review
Publishing Co., Inc., The Princeton Review Management Corporation and the other
independent The Princeton Review franchisees identified on exhibit "A" attached
thereto

Printed Name of Franchisee: Elyane Harney (Utah)
                           -----------------------------------------------------

Signature of Franchisee or
  Authorized Officer of
  Franchisee: /s/ Elyane Harney
             -------------------------------------------------------------------

Printed Name of Officer
  (if applicable): The Princeton Review
                  --------------------------------------------------------------

Address for Notice:  8 E. Broadway, Suite 212
                   -------------------------------------------------------------
                     Salt Lake City, UT  84111
                   -------------------------------------------------------------
<PAGE>   55
                              FRANCHISEE JOINDER TO
                               FORMATION AGREEMENT

         By executing in the space provided below, the Franchisee identified
below acknowledges having received and read, and agrees to become a party to,
and be bound by, the Formation Agreement dated effective May 31, 1995 by and
among The Princeton Review Publishing Company, L.L.C., The Princeton Review
Publishing Co., Inc., The Princeton Review Management Corporation and the other
independent The Princeton Review franchisees identified on exhibit "A" attached
thereto

Printed Name of Franchisee: The Princeton Review of Northern California, Inc.
                           -----------------------------------------------------

Signature of Franchisee or
  Authorized Officer of
  Franchisee: /s/ John Katzman
             -------------------------------------------------------------------

Printed Name of Officer
  (if applicable): John Katzman
                  --------------------------------------------------------------

Address for Notice:  2315 Broadway
                   -------------------------------------------------------------
                     New York, New York 10024
                   -------------------------------------------------------------

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