Document:

exv10w38

Exhibit 10.38

          AMENDMENT NO. 3, dated as of October 29, 2009 (this “Amendment”), among CAMBIUM LEARNING,
INC., a Delaware corporation and successor to VSS-Cambium Merger Corp. (“Company”), VSS-CAMBIUM
HOLDINGS IV, LLC, a Delaware limited liability company and successor to VSS-Cambium Holdings, LLC
(“Holdings”), TCW/CRESCENT MEZZANINE PARTNERS IV, L.P., as Administrative Agent, and the Required
Note-Holders, in each case listed on the signature pages hereto, to the Note Purchase Agreement
dated as of April 12, 2007 (as waived and amended by the Temporary Waiver and Amendment (“Amendment
No. 1”), dated as of May 20, 2008, such Amendment No. 1 as extended by the letter agreement dated
July 15, 2008 (“Letter Agreement”) and by that Permanent Waiver and Amendment No. 2, dated as of
August 22, 2008, and as further amended, supplemented, amended and restated, extended or otherwise
modified from time to time, the “Purchase Agreement”) among Company, Holdings, each purchaser from
time to time party thereto (collectively, the “Purchasers” and individually, a “Purchaser”) and
TCW/CRESCENT MEZZANINE PARTNERS IV, L.P., as administrative agent (in such capacity,
“Administrative Agent”) for the Purchasers. Capitalized terms used and not otherwise defined
herein shall have the meanings assigned to them in the Purchase Agreement.

          WHEREAS, pursuant to Section 8.2(t) of the Purchase Agreement and as documented by the
Joinder Agreement to the Purchase Agreement and the other Transaction Documents, dated as of June
18, 2009, VSS-CAMBIUM HOLDINGS IV, LLC has assumed all obligations, rights and responsibilities of
VSS-CAMBIUM HOLDINGS, LLC as Holdings under the Purchase Agreement and such other Transaction
Documents;

          WHEREAS, at the request of the Issuer Parties, the Administrative Agent and the Required
Note-Holders have agreed to make certain amendments to the Purchase Agreement, but only on the
terms and conditions set forth in this Amendment.

          NOW, THEREFORE, in consideration of the premises and covenants contained herein and for other
good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the
parties hereto, intending to be legally bound hereby, agree as follows:

          Section 1. Amendment to the Purchase Agreement. As of the Amendment No. 3 Effective
Date (as defined below), the Purchase Agreement shall be deemed modified to reflect the following:

          (a) Section 1.1 of the Purchase Agreement is amended by including the following
defined terms therein in appropriate alphabetical order:

“Amendment No. 3” shall mean Amendment No. 3, dated as of the Amendment No. 3
Effective Date, which amends this Agreement.

“Amendment No. 3 Effective Date” shall mean October 29, 2009.

“CV Holdings” shall mean Cambium-Voyager Holdings, Inc., a Delaware corporation.

“LAZEL” shall mean LAZEL, Inc., a Delaware corporation.

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“LAZEL Drop Down” shall mean the series of distributions and contributions of the
Equity Interests of LAZEL made by Affiliates of Company by which LAZEL becomes a
Wholly Owned Subsidiary of Company.

“Merger Transactions” shall mean all of the transactions contemplated by and
consummated pursuant to the Vowel Merger Agreement.

“Sale” shall have the meaning assigned to such term in Section 9.1(o).

“Vowel Merger Agreement” shall mean that certain Agreement and Plan of Mergers dated
as of June 20, 2009, by and among CV Holdings, Voyager Learning Company, Vowel
Acquisition Corp., Consonant Acquisition Corp., VSS-Cambium Holdings II Corp. and
Vowel Representative, LLC.

          (b) Section 1.1 of the Purchase Agreement is amended by amending or restating
the following defined terms as follows:

          (1) the definition of “Change in Control” shall be amended and restated in its
entirety as follows:

               “A “Change in Control” shall be deemed to have occurred if:

               (a) CV Holdings at any time ceases to own, directly or indirectly, 100% of the
Equity Interests of Holdings;

               (b) Holdings at any time ceases to own 100% of the Equity Interests of Company;

               (c) at any time a change of control occurs under any documentation evidencing
Material Indebtedness;

               (d) (i) one or more of the Permitted Holders (collectively) shall fail to own,
or to have the power to vote or direct the voting of CV Holdings representing, more
than 35% of the voting power of CV Holdings, (ii) one or more of the Permitted
Holders (collectively) cease to own Equity Interests representing more than 35% of
the total economic interests of the Equity Interests of CV Holdings, or (iii) unless
one or more of the Permitted Holders have the right to designate a majority of the
Board of Directors of CV Holdings, any “person” or “group” (as such terms are used
in Sections 13(d) and 14(d) of the Exchange Act), other than one or more Permitted
Holders, is or becomes the beneficial owner (as defined in Rules 13d-3 and 13d-5
under the Exchange Act, except that for purposes of this clause such person or group
shall be deemed to have “beneficial ownership” of all securities that such person or
group has the right to acquire, whether such right is exercisable immediately or
only after the passage of time), directly or indirectly, of the voting power of CV
Holdings representing either (w) a greater percentage of the voting power of CV
Holdings
than that beneficially owned or controlled by the Permitted Holders, (x) a
greater percentage of the total economic interests of the Equity Interests of CV
Holdings

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than that beneficially owned by the Permitted Holders, (y) 50% or more of the voting
power of CV Holdings or (z) 50% or more of the total economic interests of the
Equity Interests of CV Holdings; or

               (e) during any period of two consecutive years, individuals who at the
beginning of such period constituted the Board of Directors of CV Holdings or
Holdings (as applicable) (together with any new directors whose election to such
Board of Directors or whose nomination for election was endorsed by a vote of a
majority of the members of the Board of Directors of CV Holdings or Holdings (as
applicable), which members comprising such majority are then still in office and
were either directors at the beginning of such period or whose election or
nomination for election was previously so endorsed) cease for any reason to
constitute a majority of the Board of Directors of CV Holdings or Holdings, as the
case may be.

               For purposes of this definition, a person shall not be deemed to have
beneficial ownership of Equity Interests subject to a stock purchase agreement,
merger agreement or similar agreement (but not including any warrant, option
agreement, voting agreement, stockholders agreement or similar instrument or
agreement) until the consummation of the transactions contemplated by such
agreement.”

          (2) the definition of “Consolidated EBITDA” shall be amended by deleting the
“and” at the end of subclause (x)(ii)(n) and inserting the following subclauses (o)
through (t) immediately following subclause (n):

“(o) for the first eight consecutive fiscal quarters following a
Permitted Acquisition, including, without limitation, the Merger
Transactions, the amount by which deferred revenue, which if not for
a Permitted Acquisition (including, without limitation, the Merger
Transactions) would be recognized during such period, was reduced as
a result of a purchase accounting adjustment,

(p) the costs and expenses (including, without limitation, legal,
accounting, financial advisory and third-party consultant fees and
expenses) incurred in connection with (i) the Merger Transactions and
(ii) the LAZEL Drop Down; provided that such costs and expenses in
(i) and (ii) above (x) are incurred within the 12-month period
immediately prior, and/or immediately subsequent, to the Amendment
No. 3 Effective Date and (y) do not exceed $24.0 million in the
aggregate,

(q) costs and expenses related to sales of owned Real Property and
assignments, sub-leases or terminations of Leases in connection with
the Merger Transactions that are incurred within
the 12-month period immediately following the Amendment No. 3
Effective Date, not to exceed $2.0 million in the aggregate,

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(r) costs and expenses related to employee and officer severance and
termination incurred within the 12-month period immediately
subsequent to the Amendment No. 3 Effective Date, not to exceed $5.0
million in the aggregate,

(s) costs and expenses related to mergers, consolidations or
acquisitions permitted by Section 8.2(g), whether or not
consummated; provided that (a) such costs and expenses related to
such mergers, consolidations or acquisitions that are consummated are
incurred within the 12-month period immediately prior to and/or
immediately subsequent to the consummation of the applicable merger,
consolidation or acquisition and shall not exceed $5.0 million in the
aggregate and (b) costs and expenses related to mergers,
consolidations or acquisitions which are not consummated shall not
exceed $500,000 in any calendar year and $2.0 million in the
aggregate,

(t) nonrecurring integration costs and expenses arising from and
related to the Merger Transactions, including, but not limited to,
(i) re-branding (including, without limitation, company signage,
business cards, stationery), (ii) employee training, (iii) website
integration, (iv) technology, (v) data migration and (vi) transfer of
inventory, in each case solely to the extent such lost and expenses
(x) have been incurred within 12 months of the Amendment No. 3
Effective Date and (y) do not exceed $3.0 million in the aggregate,
and”

          (3) the last paragraph of the definition of “Consolidated Net Income” shall be
amended by replacing the terms “gain” and “loss” wherever those terms appear with
the terms “income” and “expense”, respectively, in the definition of “nonrecurring”.

          (4) the definition of “Management Services Agreement” shall be amended and
restated in its entirety as follows:

                “Management Services Agreement” shall mean that certain Fee Agreement by and
among CV Holdings and VSS Fund Management LLC, a Controlled Investment Affiliate of
the Sponsor (“VSS LLC”) dated as of July 24, 2009, as amended, restated,
supplemented or modified from time to time.”

          (5) the definition of “Material Indebtedness” shall be amended by deleting the
words “$2.5 million” and replacing them with the words “$7.5 million”.

          (6) the definition of “Permitted Acquisition” shall be amended by amending and
restating clause (f) in its entirety as follows:

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               “(f) the Acquisition Consideration (exclusive of any amounts financed by
Excluded Issuances) for such acquisition shall not exceed (exclusive of the Merger
Transactions) $20.0 million; provided that if (a) the First Lien Leverage Ratio (as
defined in the Senior Credit Agreement) is less than 2.50 to 1.0 and (b) the Total
Leverage Ratio is less than 3.50 to 1.0, in each case calculated on a Pro Forma
Basis after giving effect to such acquisition as of the most recent Test Period
(including the assumptions provided for in clause (ii)(x) of the “Permitted
Acquisition” definition in the Senior Credit Agreement), the Acquisition
Consideration (exclusive of any amounts financed by Excluded Issuances) for such
acquisition shall not exceed (exclusive of the Merger Transactions) $100.0 million;
provided further that (x) the aggregate amount of the Acquisition Consideration
(exclusive of any amounts financed by Excluded Issuances) for all Permitted
Acquisitions since the Amendment No. 3 Effective Date shall not exceed (exclusive of
the Merger Transactions) $150.0 million and (y) any Equity Interests constituting
all or a portion of such Acquisition Consideration shall not have a cash dividend
requirement on or prior to the Maturity Date; and”

          (7) the definition of “Permitted Holders” shall be amended by inserting “and
Section 8.2(i)(v)(B)” in the proviso immediately following the phrase, “for
purposes of the definition of ‘Change of Control’”.

          (8) the definition of “Test Period” shall be amended by inserting “(1)”
immediately following “(ii)” where it first appears.

          (c) The last sentence of Section 5.4(a) of the Purchase Agreement shall be
amended by adding “(i), (ii)(1) and (iii)” immediately after the words “Sections 8.1(a)”.

          (d) Section 8.1(a) of the Purchase Agreement shall be amended by:

          (1) (i) replacing the phrase “within 105 days” in Section 8.1(a)(i)
with the phrase “within 90 days” and (ii) replacing the phrase “an opinion of Ernst
& Young LLP” in Section 8.1(a)(i) with the phrase “an opinion of Ernst &
Young LLP, Grant Thornton LLP or Whitley Penn LLP”,

          (2) amending and restating Section 8.1(a)(ii)(2) in its entirety as
follows:

          “[Intentionally Omitted]”,

          (3) amending Section 8.1(a)(iii) by:

               (A) replacing the words “As soon as available and in any event within 30 days
after the end of each calendar month beginning with the month ending March 31, 2007
(provided that the following items delivered with respect to the months ending
January 31, 2007 shall also include the information for the months ending January
31, 2007 and February 28, 2007)” with the words “(1) To

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the extent prepared by Holdings or its Affiliates, as soon as available and in
any event, to the extent prepared, within 30 days after the end of each calendar
month”, and

               (B) adding the following to the end thereof:

          “(2) As soon as available and in any event within 30 days after
the end of each calendar month, (A) commencing with the calendar
month ended April 30, 2010, the consolidated order volumes of Company
and its Subsidiaries and (B) commencing with the first full calendar
month ended after the Amendment No. 3 Effective Date (w) the
outstanding balances for the Notes under this Agreement, (x) the
total amount of cash and Cash Equivalents held by Holdings, Company
and its Subsidiaries on a consolidated basis, (y) a certificate of a
Financial Officer of Company containing a comparison of the
consolidated expenses of Holdings, Company and its Subsidiaries as
compared to the estimate of such expenses included as part of the
budget delivered pursuant to Section 8.1(a)(viii) and (z) a summary
narrative report and management’s discussion and analysis of the
financial condition and results of operations for such month and the
then elapsed portion of the Fiscal Year, as compared to the budgeted
amounts;”

          (4) amending subclauses (iv) and (xii) of Section 8.1(a) by inserting
“(1)” immediately following “(ii)” where it first appears, in each case, and

          (5) amending Section 8.1(a)(viii) by replacing the words “each month”
with the words “each month, if available, or, if not available, each Fiscal Quarter
(and including estimates of the consolidated expenses of Holdings, Company and the
Subsidiaries on a monthly basis)”, and deleting the phrase “prepared in summary
form,” where it appears in such Section.

          (e) Section 8.2(h) of the Purchase Agreement is amended by:

          (1) amending and restating Section 8.2(h)(ii) in its entirety as
follows:

                    “(ii) (A) payments to Holdings to permit Holdings, and the subsequent use of such
payments by Holdings, to repurchase or redeem Qualified Capital Stock of Holdings held by
officers, directors or employees or former officers, directors or employees (or their
transferees, estates or beneficiaries under their estates) of any Issuer Party, upon their
death, disability, retirement, severance or termination of employment or service and (B)
direct or indirect payments to CV Holdings to permit CV Holdings and any of its
Subsidiaries, and the subsequent use of such payments by CV Holdings and any of its
Subsidiaries, to repurchase or redeem Qualified Capital Stock of CV Holdings and any of its
Subsidiaries held by officers, directors or employees or former officers, directors or
employees (or their transferees, estates or beneficiaries under their estates) of

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any Issuer Party, upon their death, disability, retirement, severance or termination of
employment or service; provided that the aggregate cash consideration paid for all such
redemptions and payments shall not exceed, in any fiscal year, the sum of (x) $2.0 million,
plus (y) the amount of any Net Cash Proceeds received by Holdings or CV Holdings and
contributed to Company from the issuance and sale since the issue date of Qualified Capital
Stock of Holdings or CV Holdings (other than the Cure Amounts or amounts contributed for
purposes of making Capital Expenditures) to officers, directors or employees of any Issuer
Party that have not been used to make any repurchases, redemptions or payments under this
clause (ii), plus (z) the net cash proceeds of any “key-man” life insurance policies of any
Issuer Party that have not been used to make any repurchases, redemptions or payments under
this clause (ii);”,

          (2) placing the phrase “direct or indirect” in front of the word “parent”
everywhere that it appears in Section 8.2(h)(iii)(C) and Section
8.2(h)(iii)(D),

          (3) placing the parenthetical “(including costs and other expenses related to
the maintenance of such direct or indirect parent as a public company subject to the
Securities Act and the Exchange Act and the rules and regulations thereunder)” after
the phrase “other expenses” in Section 8.2(h)(iii)(D) and

          (4) deleting “$250,000” in Section 8.2(h)(iii) and replacing it with
“$3,000,000”.

          (f) Section 8.2(i)(v) of the Purchase Agreement is amended and restated in its
entirety as follows:

          “(v) so long as no Default exists and the Administrative Agent and each Purchaser has
received the most current version of the Management Services Agreement, (A) at the times
specified and in the amounts set forth in the Management Services Agreement, the payment of
(i) transaction fees to VSS LLC (as defined in the definition “Management Services
Agreement”) or its Controlled Investment Affiliates (together, the “VSS Entities”) not to
exceed 1% of the enterprise value in respect of the transaction pursuant to which such fees
are owed and (ii) all other investment banking fees and related reasonable and documented
expenses payable to the VSS Entities; provided that payments in respect of monitoring,
advisory, oversight or other similar fees shall not be permitted; (B) reasonable and
documented fees and out-of-pocket expenses payable to the directors (including the chairman)
of the Board of Directors of CV Holdings in connection with their responsibilities and
services as board members in an aggregate amount not to exceed $750,000 per fiscal year; and
(C) payments in respect of the Merger Transactions in an amount not to exceed $3,000,000 in
the aggregate may be made by Company to the VSS Entities and any other Permitted Holders on
an upfront or deferred basis as agreed among Company and such Persons.”

          (g) Section 9.1 of the Purchase Agreement is amended by:

          (1) deleting the word “or” immediately after Section 9.1(m),

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          (2) placing the word “or” immediately after Section 9.1(n) and

          (3) adding a new Section 9.1(o) as follows:

                    “(o) Any VSS Entity (as defined in Section 8.2(i)(v)) effects any conveyance, sale,
lease, sub-lease, assignment, transfer or other disposition (including by way of merger or
consolidation and including Sale and Leaseback Transactions) (each such conveyance, sale,
lease, sublease, assignment or other such disposition, a “Sale”) of the Equity Interests of
CV Holdings that any VSS Entity owns, directly or indirectly; provided that any such Sales
shall not constitute an Event of Default pursuant to this paragraph (o) so long as (i) the
VSS Entities directly or indirectly own or have the power to vote or direct the voting of CV
Holdings representing more than 35% of the voting power of CV Holdings in the aggregate and
own Equity Interests representing more than 35% of the total economic interest of the Equity
Interests of CV Holdings in the aggregate and (ii) such Sales by the VSS Entities in the
aggregate do not exceed 15% of the VSS Entities direct or indirect aggregate ownership of
Equity Interests in CV Holdings as of the Amendment No. 3 Effective Date, provided further
that any such Sales in excess of such aggregate percentage shall require the consent of the
Required Note-Holders;”

          (h) Section 12.4(b)(vii) of the Purchase Agreement is amended by replacing the
words “any of the definitions used therein” with the words “any of the definitions used
therein to the extent the amendment of any such definition would have the effect of amending
any of the foregoing sections in a manner that is materially adverse to any Purchaser;”

          (i) Section 12.16 of the Purchase Agreement is amended by inserting the
following paragraph at the end:

          “Notwithstanding anything contained herein to the contrary, each holder of a Note
acknowledges that (a) the Information may include material non-public information concerning
CV Holdings or any of its Subsidiaries, as the case may be, (b) it has developed compliance
procedures regarding the use of material non-public information and (c) it will handle such
material non-public information in accordance with applicable law, including United States
Federal and state securities laws.”

          Section 2. Representations and Warranties. Company represents and warrants to the
Purchasers as of the date hereof that:

          (a) The execution, delivery and performance of this Amendment have been duly authorized by all
necessary corporate action by Company, and (i) do not require any consent or approval of,
registration or filing with, or any other action by, any Governmental Authority, (ii) will not
violate the Organizational Documents of any Issuer Party, (iii) will not violate any Requirement of
Law, (iv) will not violate or result in a default or require any consent or approval under any
indenture, agreement or other instrument binding upon any Issuer Party or its property, or give
rise to a right thereunder to require any payment to be made by any Issuer Party, and 

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(v) will not result in the creation or imposition of any Lien on any property of any Issuer Party,
except Permitted Liens;

          (b) This Amendment constitutes the legal, valid and binding obligations of Company and
Holdings enforceable against Company and the other Issuer Parties in accordance with its terms,
subject to applicable bankruptcy, insolvency, reorganization, moratorium or other laws affecting
creditors’ rights generally and subject to general principles of equity, regardless of whether
considered in a proceeding in equity or at law;

          (c) On and as of the Amendment No. 3 Effective Date (giving effect to this Amendment), each of
the representations and warranties made by any Issuer Party contained in Article 5 of the
Purchase Agreement and each other Transaction Document is true and correct in all material respects
(except that any representation and warranty that is qualified as to “materiality” or “Material
Adverse Effect” shall be true and correct in all respects on and as of the Amendment No. 3
Effective Date (giving effect to this Amendment) as if made on and as of such date and except to
the extent that such representations and warranties specifically relate to an earlier date); and

          (d) At the time of and after giving effect to this Amendment, no Default or Event of Default
has occurred and is continuing.

          Section 3. Conditions. This Amendment shall become effective as of the date (the
“Amendment No. 3 Effective Date”) when, and only when, each of the following conditions precedent
shall have been (or is or will be substantially concurrently therewith) satisfied:

          (a) The Administrative Agent (or its counsel) shall have received from each of Company,
Holdings and the Required Note-Holders either (i) a counterpart of this Amendment signed on behalf
of Company, Holdings and the Required Note-Holders or (ii) written evidence satisfactory to the
Administrative Agent (which may include facsimile transmission or other electronic communication
permitted under the Purchase Agreement of a signed signature page of this Amendment) that each of
Company, Holdings and the Required Note-Holders have signed a counterpart of this Amendment;

          (b) The Administrative Agent and the Required Note-Holders shall have received evidence
satisfactory to the Administrative Agent that Company and the Required Lenders (as defined in the
Senior Credit Agreement) shall have entered into an amendment of the Senior Credit Agreement in
form and substance as set forth on Schedule I hereto;

          (c) Company shall have paid to the Administrative Agent, for the benefit of each Purchaser who
consents to this Amendment on or prior to 5:00 p.m. on October 28, 2009, a fee (in immediately
available funds) on the Amendment No. 3 Effective Date in an amount equal to 20 basis points of
each such Purchaser’s outstanding principal balance of Notes as of the Business Day ending
immediately prior to the Amendment No. 3 Effective Date;

          (d) Except with respect to the amendments to the Purchase Agreement set forth in Section
1(b)(3) and Section 1(i) of this Amendment (which amendments shall become effective on
the date this Amendment has been executed by Company, Holdings and the

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Required Note-Holders and to the extent all the other conditions in this Section 3 have been
satisfied), the Merger Transactions shall have been consummated; and

          (e) Company shall have paid (or have caused to be paid), in each case to the extent invoiced
prior to the satisfaction of (a) through (d) of this Section 3, all reasonable out-of-pocket costs
and expenses of the Administrative Agent in connection with the preparation, reproduction,
execution and delivery of this Amendment (including, without limitation, the reasonable fees,
charges, disbursements and out-of-pocket expenses of Loeb & Loeb LLP with respect thereto).

          Section 4. Covenants.

          (a) As soon as possible, but in any event no later than 75 Business Days after the Amendment
No. 3 Effective Date, Company and its Affiliates shall have consummated the LAZEL Drop Down.

          (b) Promptly, but in any event no later than 30 days after LAZEL becomes a Wholly Owned
Subsidiary of Company, Company shall cause LAZEL to execute a Subsidiary Guaranty in accordance
with Section 8.1(k) of the Purchase Agreement.

          Section 5. Ratification of Merger Transactions. Purchasers who deliver their consent
to this Amendment hereby ratify and confirm that the Merger Transactions comply with the terms of
the Purchase Agreement (without giving effect to this Amendment), subject to any modification,
amendment, supplement or waiver of the Vowel Merger Agreement subsequent to the Amendment No. 3
Effective Date.

          Section 6. Expenses. Company agrees to promptly reimburse the Administrative Agent
for its reasonable out-of-pocket expenses incurred in connection with this Amendment, including the
reasonable fees, charges and disbursements of Loeb & Loeb LLP.

          Section 7. Counterparts. This Amendment may be executed in any number of counterparts
and by different parties hereto on separate counterparts, each of which when so executed and
delivered shall be deemed to be an original, but all of which when taken together shall constitute
a single instrument. Delivery of an executed counterpart of a signature page of this Amendment by
facsimile transmission or electronic email affirmation shall be effective as delivery of a manually
executed counterpart hereof.

          Section 8. Applicable Law; Jurisdiction; Consent to Service of Process. THIS
AMENDMENT SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAW OF THE STATE OF NEW YORK.
The waiver of venue, waiver of jury trial, jurisdiction and consent to service of process
provisions set forth in Sections 12.8 and 12.9 of the Purchase Agreement are hereby
incorporated by reference, mutatis mutandis, in this Amendment.

          Section 9. Headings. The headings of this Amendment are for purposes of reference
only and shall not limit or otherwise affect the meaning hereof.

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          Section 10. Effect of Amendment. Except as expressly set forth herein, this Amendment
shall not by implication or otherwise limit, impair, constitute a waiver of or otherwise affect the
rights and remedies of the Purchasers or the Administrative Agent under the Purchase Agreement or
any other Transaction Document, and shall not alter, modify, amend or in any way affect any of the
terms, conditions, obligations, covenants or agreements contained in the Purchase Agreement or any
other provision of the Purchase Agreement or any other Transaction Document, all of which are
ratified and affirmed in all respects and shall continue in full force and effect. By executing
and delivering a copy hereof, each applicable Issuer Party hereby agrees and confirms that all
Obligations shall be guaranteed and secured pursuant to the Transaction Documents as provided
therein.

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          IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be duly executed as of
the date first above written.

	 	 	 	 	 
	 	CAMBIUM LEARNING, INC.

 	 
	 	By:  	/s/ Scott
Troeller	 
	 	 	Name:  	Scott Troeller	 
	 	 	Title:  	Vice President	 
	 

	 	 	 	 	 
	 	VSS-CAMBIUM HOLDINGS IV, LLC

 	 
	 	By:  	/s/ Scott
Troeller	 
	 	 	Name:  	Scott Troeller	 
	 	 	Title:  	President	 

Signature Page to Amendment No. 3

 

 

	 	 	 
	 
	 	ADMINISTRATIVE AGENT:
	 
	 	 
	 
	 	TCW/CRESCENT MEZZANINE PARTNERS IV, L.P.
	 
	 	 
	 
	 	By: TCW/Crescent Mezzanine
	 
	 	Management IV, L.L.C., its Investment Manager
	 
	 	 
	 
	 	By: TCW/Asset Management Company,
	 
	 	its Sub-Advisor

	 	 	 	 	 
	 	 	 
	 	By:  	/s/ Joseph
Kaufman	 
	 	 	Name:  	Joseph Kaufman	 
	 	 	Title:  	Senior Vice President	 

Signature Page to Amendment No. 3

 

 

	 	 	 	 	 

	 	 	 
	 

	 	PURCHASERS:
	 
	 	 
	 

	 	TCW/CRESCENT MEZZANINE PARTNERS IV, L.P.
	 
	 	 
	 

	 	By: TCW/Crescent Mezzanine
	 

	 	Management IV, L.L.C.,
its Investment Manager
	 
	 	 
	 

	 	By: TCW/Asset Management Company,
	 

	 	its Sub-Advisor

	 	 	 	 	 
	 	 	 
	 	By:  	/s/ Joseph
Kaufman	 
	 	 	Name:  	Joseph Kaufman	 
	 	 	Title:  	Senior Vice President	 
	 

	 	 	 
	 

	 	TCW/CRESCENT MEZZANINE PARTNERS IVB, L.P.
	 
	 	 
	 

	 	By: TCW/Crescent Mezzanine
	 

	 	Management IV, L.L.C.,.
its Investment Manager
	 
	 	 
	 

	 	By: TCW/Asset Management Company,
	 

	 	its Sub-Advisor

	 	 	 	 	 
	 	 	 
	 	By:  	/s/ Joseph
Kaufman	 
	 	 	Name:  	Joseph Kaufman	 
	 	 	Title:  	Senior Vice President	 

Signature Page to Amendment No. 3

 

 

	 	 	 	 	 

	 	 	 
	 
	 	MAC CAPITAL, LTD.
	 
	 	 
	 
	 	By: TCW Advisors, Inc., as attorney-in-fact

	 	 	 	 	 
	 	 	 
	 	By:  	/s/ Jonathan
R. Insull	 
	 	 	Name:  	Jonathan R. Insull	 
	 	 	Title:  	Managing Director	 

	 	 	 	 	 
	 	By:  	[Illegible]	 
	 	 	Name:  	 	 
	 	 	Title:  	 	 

Signature Page to Amendment No. 3

 

 

	 	 	 	 	 

	 	 	 
	 

	 	NEW YORK LIFE INVESTMENT
	 

	 	MANAGEMENT MEZZANINE
PARTNERS II, LP
	 
	 	 
	 

	 	By: NYLIM Mezzanine Partners II GenPar, LP
	 

	 	Its: General Partner
	 
	 	 
	 

	 	By: NYLIM Mezzanine Partners II GenPar GP, LLC
	 

	 	Its: General Partner

	 	 	 	 	 
	 	 	 
	 	By:  	/s/ James
M. Barker V	 
	 	 	Name:  	James M. Barker V	 
	 	 	Title:  	Executive Vice President	 
	 

	 	 	 
	 

	 	NYLIM MEZZANINE PARTNERS II PARALLEL FUND, LP
	 
	 	 
	 

	 	By: NYLIM Mezzanine Partners II GenPar, LP
	 

	 	Its: General Partner
	 
	 	 
	 

	 	By: NYLIM Mezzanine Partners II GenPar GP, LLC
	 

	 	Its: General Partner

	 	 	 	 	 
	 	 	 
	 	By:  	/s/ James
M. Barker V	 
	 	 	Name:  	James M. Barker V	 
	 	 	Title:  	Executive Vice President	 

Signature Page to Amendment No. 3

 

 

	 	 	 	 	 
	 	GOLDENTREE CAPITAL SOLUTIONS FUND FINANCING

 	 
	 	By:  	GoldenTree Asset Management, LP
 	 
	 	 	 	 	 
	 	By:  	/s/ Karen
Weber	 
	 	 	Name:  	Karen Weber	 
	 	 	Title:  	Director — Bank Debt	 
	 

	 	 	 
	 
	 	GOLDENTREE CAPITAL OPPORTUNITIES, LP
	 
	 	 
	 
	 	By: GoldenTree Asset Management, LP

	 	 	 	 	 
	 	By:  	/s/ Karen
Weber	 
	 	 	Name:  	Karen Weber	 
	 	 	Title:  	Director — Bank Debt	 
	 

	 	 	 
	 
	 	GOLDENTREE CAPITAL SOLUTIONS OFFSHORE FUND FINANCING
	 
	 	 
	 
	 	By: GoldenTree Asset Management, LP

	 	 	 	 	 
	 	By:  	/s/ Karen
Weber	 
	 	 	Name:  	Karen Weber	 
	 	 	Title:  	Director — Bank Debt	 
	 

Signature Page to Amendment No. 3

 

 

SCHEDULE I

Amendment No. 3 to Senior Credit Agreement

 

 

EXECUTION VERSION

          AMENDMENT NO. 3, dated as of October 29, 2009 (this “Amendment No. 3”), among CAMBIUM
LEARNING, INC., a Delaware corporation (“Borrower”), BARCLAYS BANK PLC, as Administrative Agent,
and the Lenders party hereto, in each case listed on the signature pages hereto, to the Credit
Agreement dated as of April 12, 2007 (as waived and amended by the Limited Waiver and Amendment
(“Amendment No. 1”), dated as of May 20, 2008, such Amendment No. 1 as extended by the letter
agreement dated July 15, 2008 (“Letter Agreement”), as amended by the Permanent Waiver and
Amendment (“Amendment No. 2”), dated as of August 22, 2008, as further amended, supplemented,
amended and restated, extended or otherwise modified from time to time) (the “Credit Agreement”)
among Borrower, VSS-CAMBIUM HOLDINGS IV, LLC, a Delaware limited liability company and successor to
VSS-CAMBIUM HOLDINGS, LLC (“Holdings”), the Subsidiary Guarantors, each lender from time to time
party thereto (collectively, the “Lenders” and individually, a “Lender”), CREDIT SUISSE SECURITIES
(USA) LLC, as co-syndication agent (in such capacity, “Co-Syndication Agent”), BNP PARIBAS, as
co-syndication agent (in such capacity, “Co-Syndication Agent” and together with the other
Co-Syndication Agent, the “Syndication Agents”), TD Securities (USA) LLC, as documentation agent
(in such capacity, “Documentation Agent”), and BARCLAYS BANK PLC, as issuing bank (in such
capacity, “Issuing Bank”), as administrative agent (in such capacity, “Administrative Agent”) for
the Lenders and as collateral agent (in such capacity, “Collateral Agent”) for the Secured Parties
and the Issuing Bank. Capitalized terms used and not otherwise defined herein shall have the
meanings assigned to them in the Credit Agreement.

          WHEREAS, pursuant to Section 6.21 of the Credit Agreement and as documented by the
joinder agreements to each of the Credit Agreement, the Security Agreement and the Securities
Pledge Agreement, in each case dated as of June 18, 2009, by and between VSS-CAMBIUM HOLDINGS IV,
LLC and the Administrative Agent and/or the Collateral Agent, as applicable, VSS-CAMBIUM HOLDINGS
IV, LLC has assumed all obligations, rights and responsibilities of VSS-CAMBIUM HOLDINGS, LLC as
Holdings under the Credit Agreement; and

          WHEREAS, at the request of the Loan Parties, the Administrative Agent and the Required Lenders
have agreed to make certain amendments to the Credit Agreement, but only on the terms and
conditions set forth in this Amendment No. 3.

          NOW, THEREFORE, in consideration of the premises and covenants contained herein and for other
good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the
parties hereto, intending to be legally bound hereby, agree as follows:

          Section 1. Amendment to the Credit Agreement.
As of the Amendment No. 3 Effective Date (as defined in Section 3 below), the Credit
Agreement shall be deemed modified to reflect the following:

 

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     (i) Section 1.01 of the Credit Agreement is amended by including the following
defined terms therein in appropriate alphabetical order:

“Amendment No. 3” shall mean Amendment No. 3, dated as of
the Amendment No. 3 Effective Date, which amends this Agreement.

“Amendment No. 3 Effective Date” shall mean October 29, 2009.

“CV Holdings” shall mean Cambium-Voyager Holdings, Inc., a Delaware
corporation.

“LAZEL” shall mean LAZEL, Inc., a Delaware corporation.

“LAZEL Drop Down” shall mean the series of distributions and contributions
of the Equity Interests of LAZEL made by Affiliates of the Borrower by which
LAZEL becomes a Wholly Owned Subsidiary of Borrower.

“Merger Transactions” shall mean all of the transactions contemplated by and
consummated pursuant to the Vowel Merger Agreement.

“Sale” shall have the meaning assigned to such term in Section
8.01(o).

“Vowel Merger Agreement” shall mean that certain Agreement and Plan of
Mergers dated as of June 20, 2009, by and among CV Holdings, Voyager
Learning Company, Vowel Acquisition Corp., Consonant Acquisition Corp.,
VSS-Cambium Holdings II Corp. and Vowel Representative, LLC.

     (ii) Section 1.01 of the Credit Agreement is amended by amending or restating
the following defined terms as follows:

     (a) the definition of “Change in Control” shall be amended and restated in its
entirety as follows:

“A “Change in Control” shall be deemed to have occurred if:

(a) CV Holdings at any time ceases to own, directly or indirectly,
100% of the Equity Interests of Holdings;

(b) Holdings at any time ceases to own 100% of the Equity Interests
of Borrower;

(c) at any time a change of control occurs under any documentation
evidencing Material Indebtedness;

(d) (i) one or more of the Permitted Holders (collectively) shall
fail to own, or to have the power to vote or direct the voting of CV
Holdings representing, more than 35% of the voting power of CV

 

-3-

Holdings, (ii) one or more of the Permitted Holders (collectively)
cease to own Equity Interests representing more than 35% of the total
economic interests of the Equity Interests of CV Holdings, or (iii)
unless one or more of the Permitted Holders have the right to
designate a majority of the Board of Directors of CV Holdings, any
“person” or “group” (as such terms are used in Sections 13(d) and
14(d) of the Exchange Act), other than one or more Permitted Holders,
is or becomes the beneficial owner (as defined in Rules 13d-3 and
13d-5 under the Exchange Act, except that for purposes of this clause
such person or group shall be deemed to have “beneficial ownership”
of all securities that such person or group has the right to acquire,
whether such right is exercisable immediately or only after the
passage of time), directly or indirectly, of the voting power of CV
Holdings representing either (w) a greater percentage of the voting
power of CV Holdings than that beneficially owned or controlled by
the Permitted Holders, (x) a greater percentage of the total economic
interests of the Equity Interests of CV Holdings than that
beneficially owned by the Permitted Holders, (y) 50% or more of the
voting power of CV Holdings or (z) 50% or more of the total economic
interests of the Equity Interests of CV Holdings; or

(e) during any period of two consecutive years, individuals who at
the beginning of such period constituted the Board of Directors of CV
Holdings or Holdings (as applicable) (together with any new directors
whose election to such Board of Directors or whose nomination for
election was endorsed by a vote of a majority of the members of the
Board of Directors of CV Holdings or Holdings (as applicable), which
members comprising such majority are then still in office and were
either directors at the beginning of such period or whose election or
nomination for election was previously so endorsed) cease for any
reason to constitute a majority of the Board of Directors of CV
Holdings or Holdings, as the case may be.

For purposes of this definition, a person shall not be deemed to have
beneficial ownership of Equity Interests subject to a stock purchase
agreement, merger agreement or similar agreement (but not including
any warrant, option agreement, voting agreement, stockholders
agreement or similar instrument or agreement) until the consummation
of the transactions contemplated by such agreement.”

 

-4-

     (b) the definition of “Consolidated EBITDA” shall be amended by deleting the
“and” at the end of subclause (x)(ii)(n) and inserting the following subclauses (o)
through (t) immediately following subclause (n):

“(o) for the first eight consecutive fiscal quarters following a
Permitted Acquisition, including, without limitation, the Merger
Transactions, the amount by which deferred revenue, which if not for
a Permitted Acquisition (including, without limitation, the Merger
Transactions) would be recognized during such period, was reduced as
a result of a purchase accounting adjustment,

(p) the costs and expenses (including, without limitation, legal,
accounting, financial advisory and third-party consultant fees and
expenses) incurred in connection with (i) the Merger Transactions and
(ii) the LAZEL Drop Down; provided that such costs and expenses in
(i) and (ii) above (x) are incurred within the 12-month period
immediately prior, and/or immediately subsequent, to the Amendment
No. 3 Effective Date and (y) do not exceed $24.0 million in the
aggregate,

(q) costs and expenses related to sales of owned Real Property and
assignments, sub-leases or terminations of Leases in connection with
the Merger Transactions that are incurred within the 12-month period
immediately following the Amendment No. 3 Effective Date, not to
exceed $2.0 million in the aggregate,

(r) costs and expenses related to employee and officer severance and
termination incurred within the 12-month period immediately
subsequent to the Amendment No. 3 Effective Date, not to exceed $5.0
million in the aggregate,

(s) costs and expenses related to mergers, consolidations or
acquisitions permitted by Section 6.07, whether or not
consummated; provided that (a) such costs and expenses related to
such mergers, consolidations or acquisitions that are consummated are
incurred within the 12-month period immediately prior to and/or
immediately subsequent to the consummation of the applicable merger,
consolidation or acquisition and shall not exceed $5.0 million and
(b) costs and expenses related to mergers, consolidations or
acquisitions which are not consummated shall not exceed $500,000 in
any calendar year and $2.0 million in the aggregate,

(t) nonrecurring integration costs and expenses arising from and
related to the Merger Transactions, including, but not limited to,
(i) re-branding (including, without limitation, company signage,
 

 

-5-

business cards, stationery), (ii) employee training, (iii) website
integration, (iv) technology, (v) data migration and (vi) transfer of
inventory, in each case solely to the extent such lost and expenses
(x) have been incurred within 12 months of the Amendment No. 3
Effective Date and (y) do not exceed $3.0 million in the aggregate,
and”

     (c) the last paragraph of the definition of “Consolidated Net Income” shall be
amended by replacing the terms “gain” and “loss” wherever those terms appear with
the terms “income” and “expense”, respectively, in the definition of “nonrecurring”.

     (d) the definition of “Management Services Agreement” shall be amended and
restated in its entirety as follows:

“Management Services Agreement” shall mean that certain Fee Agreement
by and among CV Holdings and VSS Fund Management LLC, a Controlled
Investment Affiliate of the Sponsor (“VSS LLC”) dated as of July 24,
2009, as amended, restated, supplemented or modified from time to
time.”

     (e) the definition of “Material Indebtedness” shall be amended by deleting the
words “$5.0 million” and replacing them with the words “$7.5 million”.

     (f) the definition of “Permitted Acquisition” shall be amended by amending and
restating clause (vii) in its entirety as follows:

“(vii) the Acquisition Consideration (exclusive of any amounts
financed by Excluded Issuances) for such acquisition shall not exceed
(exclusive of the Merger Transactions) $20.0 million; provided that
if (a) the First Lien Leverage Ratio is less than 2.50 to 1.0 and (b)
the Total Leverage Ratio is less than 3.50 to 1.0, in each case
calculated on a Pro Forma Basis after giving effect to such
acquisition as of the most recent Test Period (including the
assumptions provided for in clause (ii)(x) of this definition above),
the Acquisition Consideration (exclusive of any amounts financed by
Excluded Issuances) for such acquisition shall not exceed (exclusive
of the Merger Transactions) $100.0 million; provided further that (x)
the aggregate amount of the Acquisition Consideration (exclusive of
any amounts financed by Excluded Issuances) for all Permitted
Acquisitions since the Amendment No. 3 Effective Date shall not
exceed (exclusive of the Merger Transactions) $150.0 million and (y)
any Equity Interests constituting all or a portion of
 

 

-6-

such Acquisition Consideration shall not have a cash dividend
requirement on or prior to the Final Maturity Date; and”

     (g) the definition of “Permitted Holders” shall be amended by inserting “and
Section 6.09(e)(B)” in the proviso immediately following the phrase, “for
purposes of the definition of ‘Change of Control’”.

     (h) the definition of “Test Period” shall be amended by inserting “(i)”
immediately following “(b)” where it first appears.

     (iii) Section 2.19(b)(iii) shall be amended by inserting “(i)” immediately
following “(b)” where it first appears.

     (iv) The last sentence of Section 3.04(a) shall be amended by (x) replacing the
“,” immediately after the words “Sections 5.01(a)” with the word “and”, (y)
inserting “(i)” immediately following “(b)” where it first appears and (z) deleting
the phrase “and c” within such sentence.

     (v) Section 5.01 of the Credit Agreement shall be amended by (w)(i) replacing
the phrase “within 105 days” in Section 5.01(a)(i) with the phrase “within 90 days”
and (ii) replacing the phrase “an opinion of Ernst & Young LLP” in Section
5.01(a)(i) with the phrase “an opinion of Ernst & Young LLP, Grant Thornton LLP or
Whitley Penn LLP”, (x) amending and restating Section 5.01(b)(ii) in its entirety as
follows:

“and (ii) as soon as available and in any event within 30 days after
the end of each calendar month, (1) commencing with the calendar
month ended April 30, 2010, the consolidated order volumes of
Borrower and the Subsidiaries and (2) commencing with the first full
calendar month ended after the Amendment No. 3 Effective Date (w) the
outstanding balances for each Class of Loans outstanding under this
Agreement, (x) the total amount of cash and Cash Equivalents held by
Holdings, Borrower and the Subsidiaries on a consolidated basis, (y)
a certificate of a Financial Officer of Borrower containing a
comparison of the consolidated expenses of Holdings, Borrower and the
Subsidiaries as compared to the estimate of such expenses included as
part of the budget delivered pursuant to Section 5.01(g) and
(z) a summary narrative report and management’s discussion and
analysis of the financial condition and results of operations for
such month and the then elapsed portion of the fiscal year, as
compared to the budgeted amounts;”,

(y) amending subclauses (c) and (k) of Section 5.01 by inserting “(i)”
immediately following “(b)” where it first appears, in each case, and

(z) amending Section 5.01(g) by inserting the parenthetical “(and including
estimates of the consolidated expenses of Holdings, Borrower and the Subsidiaries on
 

 

-7-

a monthly basis)” immediately after the phrase “for each fiscal quarter” and
deleting the phrase “prepared in summary form,” where it appears in such Section.

     (vi) Section 6.08 of the Credit Agreement is amended by (w) amending and
restating Section 6.08(b) in its entirety as follows:

“(b) (A) payments to Holdings to permit Holdings, and the subsequent
use of such payments by Holdings, to repurchase or redeem Qualified
Capital Stock of Holdings held by officers, directors or employees or
former officers, directors or employees (or their transferees,
estates or beneficiaries under their estates) of any Company, upon
their death, disability, retirement, severance or termination of
employment or service and (B) direct or indirect payments to CV
Holdings to permit CV Holdings and any of its Subsidiaries, and the
subsequent use of such payments by CV Holdings and any of its
Subsidiaries, to repurchase or redeem Qualified Capital Stock of CV
Holdings and any of its Subsidiaries held by officers, directors or
employees or former officers, directors or employees (or their
transferees, estates or beneficiaries under their estates) of any
Company, upon their death, disability, retirement, severance or
termination of employment or service; provided that the aggregate
cash consideration paid for all such redemptions and payments shall
not exceed, in any fiscal year, the sum of (x) $2.0 million, plus (y)
the amount of any Net Cash Proceeds received by Holdings or CV
Holdings and contributed to Borrower from the issuance and sale since
the issue date of Qualified Capital Stock of Holdings or CV Holdings
(other than the Cure Amounts or amounts contributed for purposes of
making Capital Expenditures) to officers, directors or employees of
any Company that have not been used to make any repurchases,
redemptions or payments under this clause (b), plus (z) the net cash
proceeds of any “key-man” life insurance policies of any Company that
have not been used to make any repurchases, redemptions or payments
under this clause (b);”

,(x) placing the phrase “direct or indirect” in front of the word “parent”
everywhere that it appears in Section 6.08(c)(C) and Section
6.08(c)(D), (y) placing the parenthetical “(including costs and other expenses
related to the maintenance of such direct or indirect parent as a public company
subject to the Securities Act and the Exchange Act and the rules and regulations
thereunder)” after the phrase “other expenses” in Section 6.08(c)(D) and (z)
deleting “$250,000” in Section 6.08(c)(D) and replacing it with
“$3,000,000”.

(vii) Section 6.09(e) is amended and restated in its entirety as follows:
 

 

-8-

“(e) so long as no Default exists and the Administrative Agent has
received the most current version of the Management Services
Agreement, (x) at the times specified and the amounts set forth in
the Management Services Agreement, the payment of (i) transaction
fees to VSS LLC or its Controlled Investment Affiliates (together,
the “VSS Entities”) not exceed 1% of the enterprise value in respect
of the transaction pursuant to which such fees are owed and (ii) all
other investment banking fees and related reasonable and documented
expenses payable to the VSS Entities; provided that payments in
respect of monitoring, advisory, oversight or other similar fees
shall not be permitted; (y) reasonable and documented fees and
out-of-pocket expenses payable to the directors (including the
chairman) of the Board of Directors of CV Holdings in connection with
their responsibilities and services as board members in an aggregate
amount not to exceed $750,000 per fiscal year; and (z) payments in
respect of the Merger Transactions in an amount not to exceed
$3,000,000 in the aggregate may be made by the Borrower to the VSS
Entities and any other Permitted Holders on an upfront or deferred
basis as agreed among the Borrower and such Persons.”

     (viii) Section 8.01 of the Credit Agreement is amended by (x) deleting the word
“or” immediately after Section 8.01(m), (y) placing the word “or” immediately after
Section 8.01(n) and (z) adding a new Section 8.01(o) as follows:

“(o) Any VSS Entity effects any conveyance, sale, lease, sublease,
assignment, transfer or other disposition (including by way of merger
or consolidation and including Sale and Leaseback Transactions) (each
such conveyance, sale, lease, sublease, assignment or other such
disposition, a “Sale”) of the Equity Interests of CV Holdings that
any VSS Entity owns, directly or indirectly; provided that any such
Sales shall not constitute an Event of Default pursuant to this
paragraph (o) so long as (i) the VSS Entities directly or indirectly
own or have the power to vote or direct the voting of CV Holdings
representing more than 35% of the voting power of CV Holdings in the
aggregate and own Equity Interests representing more than 35% of the
total economic interest of the Equity Interests of CV Holdings in the
aggregate and (ii) such Sales by the VSS Entities in the aggregate do
not exceed 15% of the VSS Entities direct or indirect aggregate
ownership of Equity Interests in CV Holdings as of the Amendment No.
3 Effective Date, provided further that any such Sales in excess of
such aggregate percentage shall require the consent of the Required
Lenders;”
 

 

-9-

     (ix) Section 10.12 of the Credit Agreement is amended by inserting the
following paragraph at the end:

“Notwithstanding anything contained herein to the contrary, each of
the Administrative Agent, the Lenders and the Issuing Bank
acknowledges that (a) the Information may include material non-public
information concerning CV Holdings or any of its Subsidiaries, as the
case may be, (b) it has developed compliance procedures regarding the
use of material non-public information and (c) it will handle such
material non-public information in accordance with applicable Law,
including United States Federal and state securities laws.”

          Section 2. Representations and Warranties.
Borrower represents and warrants to the Lenders as of the date hereof that:

     (a) The execution, delivery and performance of this Amendment No. 3 have been duly
authorized by all necessary corporate action by Borrower, and (i) do not require any consent
or approval of, registration or filing with, or any other action by, any Governmental
Authority, (ii) will not violate the Organizational Documents of any Loan Party, (iii) will
not violate any Requirement of Law, (iv) will not violate or result in a default or require
any consent or approval under any indenture, agreement or other instrument binding upon any
Loan Party or its property, or give rise to a right thereunder to require any payment to be
made by any Loan Party, and (v) will not result in the creation or imposition of any Lien on
any property of any Loan Party, except Liens created by the Loan Documents and Permitted
Liens;

     (b) This Amendment No. 3 constitutes the legal, valid and binding obligations of
Borrower enforceable against Borrower and the other Loan Parties in accordance with its
terms, subject to applicable bankruptcy, insolvency, reorganization, moratorium or other
laws affecting creditors’ rights generally and subject to general principles of equity,
regardless of whether considered in a proceeding in equity or at law;

     (c) On and as of the Amendment No. 3 Effective Date (giving effect to this Amendment
No. 3), each of the representations and warranties made by any Loan Party contained in
Article III of the Credit Agreement and each other Loan Document is true and correct in all
material respects (except that any representation and warranty that is qualified as to
“materiality” or “Material Adverse Effect” shall be true and correct in all respects on and
as of the Amendment No. 3 Effective Date as if made on and as of such date and except to the
extent that such representations and warranties specifically relate to an earlier date); and

     (d) At the time of and after giving effect to this Amendment No. 3, no Default or Event
of Default has occurred and is continuing.
 

 

-10-

          Section 3.
Conditions.
This Amendment No. 3 shall become effective as of the date (the “Amendment No. 3 Effective
Date”) when, and only when, each of the following conditions precedent shall have been (or is or
will be substantially concurrently therewith) satisfied:

     (a) The Administrative Agent (or its counsel) shall have received from each of Borrower
and the Required Lenders either (i) a counterpart of this Amendment No. 3 signed on behalf
of Borrower and the Required Lenders or (ii) written evidence satisfactory to the
Administrative Agent (which may include facsimile transmission or other electronic
communication permitted under the Credit Agreement of a signed signature page of this
Amendment No. 3) that each of Borrower and the Required Lenders has signed a counterpart of
this Amendment No. 3;

     (b) Borrower shall have paid (or have caused to be paid) to the Administrative Agent,
for the benefit of each Lender who consents to this Amendment No. 3 on or prior to 5:00
p.m., New York City time, on October 28, 2009, a fee (in immediately available funds) on the
Amendment No. 3 Effective Date in an amount equal to 20 basis points of each such Lender’s
outstanding Loans and unused Revolving Commitments as of the Business Day ending immediately
prior to the Amendment No. 3 Effective Date;

     (c) Except with respect to the amendments to the Credit Agreement set forth in Section
1(ii)(c) and Section 1(ix) of this Amendment No. 3, (which amendments shall become effective
on the date this Amendment No. 3 has been executed by Borrower and the Required Lenders and
to the extent all the other conditions in this Section 3 have been satisfied) the Merger
Transactions shall have been consummated; and

     (d) Borrower shall have paid (or have caused to be paid), in each case to the extent
invoiced prior to the Amendment No. 3 Effective Date, all reasonable out-of-pocket costs and
expenses of the Administrative Agent in connection with the preparation, reproduction,
execution and delivery of this Amendment (including, without limitation, the reasonable
fees, charges, disbursements and out-of-pocket expenses of Cahill Gordon & Reindel LLP with
respect thereto).

          Section 4. Covenants.

          As soon as possible, but in any event no later than 75 Business Days after the Amendment No. 3
Effective Date, Borrower and its Affiliates shall have consummated the LAZEL Drop Down.

     Section 5. Ratification of Merger Transactions.
Lenders who deliver their consent to this Amendment No. 3 hereby ratify and confirm that
the Merger Transactions comply with the terms of the Credit Agreement (without giving effect to
this Amendment No. 3), subject to any modification, amendment, supplement or waiver of the Vowel
Merger Agreement subsequent to the Amendment No. 3 Effective Date.
 

 

-11-

          Section 6. Expenses.
Borrower agrees to promptly reimburse the Administrative Agent for its reasonable
out-of-pocket expenses incurred in connection with this Amendment No. 3, including the reasonable
fees, charges and disbursements of Cahill Gordon & Reindel llp.

          Section 7. Counterparts.
This Amendment No. 3 may be executed in any number of counterparts and by different parties
hereto on separate counterparts, each of which when so executed and delivered shall be deemed to be
an original, but all of which when taken together shall constitute a single instrument. Delivery
of an executed counterpart of a signature page of this Amendment No. 3 by facsimile transmission or
electronic email affirmation shall be effective as delivery of a manually executed counterpart
hereof.

          Section 8. Applicable Law; Jurisdiction; Consent to Service of Process.
THIS AMENDMENT NO. 3 SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAW OF THE
STATE OF NEW YORK. The waiver of venue, waiver of jury trial, jurisdiction and consent to service
of process provisions set forth in Sections 10.09 and 10.10 of the Credit Agreement
are hereby incorporated by reference, mutatis mutandis, in this Amendment No. 3.

          Section 9. Headings.
The headings of this Amendment No. 3 are for purposes of reference only and shall not limit or
otherwise affect the meaning hereof.

          Section 10. Effect of Amendment No. 3.
Except as expressly set forth herein, this Amendment No. 3 shall not by implication or
otherwise limit, impair, constitute a waiver of or otherwise affect the rights and remedies of the
Lenders or the Agents under the Credit Agreement or any other Loan Document, and shall not alter,
modify, amend or in any way affect any of the terms, conditions, obligations, covenants or
agreements contained in the Credit Agreement or any other provision of the Credit Agreement or any
other Loan Document, all of which are ratified and affirmed in all respects and shall continue in
full force and effect. By executing and delivering a copy hereof, each applicable Loan Party
hereby agrees and confirms that all Loans and Obligations shall be guaranteed and secured pursuant
to the Loan Documents as provided therein.

 

          IN WITNESS WHEREOF, the parties hereto have caused this Amendment No. 3 to be duly executed as
of the date first above written.

	 	 	 	 	 
	 	CAMBIUM LEARNING, INC.

 	 
	 	By:  	 	 
	 	 	Name:  	 	 
	 	 	Title:  	 	 
	 

[Amendment No. 3 Signature Page]

 

	 	 	 	 	 
	 	BARCLAYS BANK PLC, as Administrative Agent,
     Issuing Bank, Collateral Agent and Lender

 	 
	 	By:  	 	 
	 	 	Name:  	 	 
	 	 	Title:  	 	 
	 
	 	 	 
	 	By:  	
 	 
	 	 	Name:  	 	 
	 	 	Title:  	 	 

[Amendment No. 3 Signature Page]

 

	 	 	 	 	 
	 	 	, as a Lender 
	 	 	 
	 	By:  	 	 
	 	 	Name:  	 	 
	 	 	Title:  	 	 
	 
	 	[If a second signature is necessary:]

 	 
	 	By:  	 	 
	 	 	Name:  	 	 
	 	 	Title:  	 	 
	 

[Amendment No. 3 Signature Page]exv4w1

Exhibit 4.1

Chief Executive Officer’s Certificate

     The undersigned, on behalf of ProLogis (the “Company”), acting pursuant to resolutions
adopted by the Pricing Committee of the Board of Trustees (the “Board”) of the Company on
October 27, 2009, hereby establishes a series of Debt Securities by means of this Chief Executive
Officer’s Certificate in accordance with the Indenture, dated as of March 1, 1995 (the “Base
Indenture,” and as supplemented by the First Supplemental Indenture thereto, the Second
Supplemental Indenture thereto, the Third Supplemental Indenture thereto, the Fourth Supplemental
Indenture thereto, the Fifth Supplemental Indenture thereto, the Sixth Supplemental Indenture
thereto, the Seventh Supplemental Indenture thereto, the Eighth Supplemental Indenture thereto and
the Ninth Supplemental Indenture thereto, the “Indenture”), between the Company and U.S.
Bank National Association (successor in interest to State Street Bank and Trust Company), as
trustee (the “Trustee”). Capitalized terms used but not defined in this Chief Executive
Officer’s Certificate shall have the meanings ascribed to them in the Indenture.

7.375% Notes due 2019 

     1. The series shall be entitled the “7.375% Notes due 2019” (the “Notes”).

     2. The Notes initially shall be limited to an aggregate principal amount of $600,000,000
(except in each case for Notes authenticated and delivered upon registration of transfer of, or in
exchange for, or in lieu of, other Notes of or within the Series pursuant to Section 304, 305, 306,
906, 1107 or 1305 of the Indenture); provided, the Company may increase such aggregate principal
amount upon the action of the Board to do so from time to time.

     3. The Notes shall bear interest at the rate of 7.375% per annum. The aggregate principal
amount of the Notes is payable at maturity on October 30, 2019. The interest on this Series shall
accrue from October 30, 2009 or from the most recent Interest Payment Date (as defined below) to
which interest has been paid or duly provided for. Interest on the Notes will be payable
semi-annually on April 30 and October 30 of each year (each an “Interest Payment Date”),
commencing on April 30, 2010. Interest shall be paid to persons in whose names the Notes are
registered on the April 15 and October 15 preceding the Interest Payment Date (each a “Regular
Record Date”).

     4. Payment of the principal of and interest, if any, on the Notes (or Make-Whole Amount, if
applicable) will be made, the Notes may be surrendered for registration of transfer or exchange and
notices or demands to or upon the Company in respect of the Notes and the Indenture may be served,
at the office or agency of the Company maintained for that purpose in the Borough of Manhattan,
City of New York and the office of the Trustee, initially located at 180 E. Fifth Street, 4th
Floor, St. Paul, Minnesota 55101, Attention: Corporate Trust Division.

     5. The Notes may be redeemed in whole at any time or in part from time to time, at the option
of the Company, upon notice of not more than 60 nor less than 30 days prior to the Redemption Date,
at a redemption price (the “Make-Whole Amount”) equal to the greater of

 

 

	 	(1)	 	100% of the principal amount of the Notes to be redeemed; or
	 
	 	(2)	 	the sum of the present values of the remaining scheduled payments of principal
and interest on the Notes to be redeemed (exclusive of interest accrued to the
Redemption Date) discounted to the Redemption Date on a semiannual basis (assuming a
360-day year consisting of twelve 30-day months) at the then current Treasury Rate plus
50 basis points.

     In each case the Company will pay accrued and unpaid interest on the principal amount being
redeemed to the Redemption Date.

     The following definitions apply with respect to the Make-Whole Amount:

          “Comparable Treasury Issue” means the United States Treasury security selected by an
Independent Investment Banker as having a maturity comparable to the remaining term (“Remaining
Life”) of the Notes to be redeemed that would be utilized, at the time of selection and in
accordance with customary financial practice, in pricing new issues of corporate debt securities of
comparable maturity to the Remaining Life.

          “Comparable Treasury Price” means, with respect to any Redemption Date, (1) the average of the
Reference Treasury Dealer Quotations for such Redemption Date, after excluding the highest and
lowest Reference Treasury Dealer Quotations, or (2) if the Trustee obtains fewer than four such
Reference Treasury Dealer Quotations, the average of all such quotations.

          “Independent Investment Banker” means one of the Reference Treasury Dealers that the Company
appoints to act as the Independent Investment Banker from time to time.

          “Reference Treasury Dealer” means each of Banc of America Securities LLC, Citigroup Global
Markets Inc. and Goldman, Sachs & Co., and their successors, and two other firms that are primary
U.S. Government securities dealers (each a “Primary Treasury Dealer”) which the Company
specifies from time to time; provided, however, that if any of them ceases to be a Primary Treasury
Dealer, the Company shall substitute another Primary Treasury Dealer.

          “Reference Treasury Dealer Quotations” means, with respect to each Reference Treasury Dealer
and any Redemption Date, the average, as determined by the Trustee, of the bid and asked prices for
the Comparable Treasury Issue (expressed in each case as a percentage of its principal amount)
quoted in writing to the Trustee by such Reference Treasury Dealer at 5:00 p.m., New York City
time, on the third business day preceding such Redemption Date.

          “Treasury Rate” means, with respect to any Redemption Date, the rate per year equal to: (1)
the yield, under the heading which represents the average for the immediately preceding week,
appearing in the most recently published statistical release designated “H.15(519)” or any
successor publication which is published weekly by the Board of Governors of the Federal Reserve
System and which establishes yields on actively traded United States Treasury securities adjusted
to constant maturity under the caption “Treasury Constant Maturities”, for the maturity
corresponding to the Comparable Treasury Issue; provided that, if no maturity is within three
months before or after the Remaining Life of the Notes to be

 

 

redeemed, yields for the two published maturities most closely corresponding to the Comparable
Treasury Issue shall be determined and the Treasury Rate shall be interpolated or extrapolated from
those yields on a straight line basis, rounding to the nearest month; or (2) if such release (or
any successor release) is not published during the week preceding the calculation date or does not
contain such yields, the rate per year equal to the semiannual equivalent yield to maturity of the
Comparable Treasury Issue, calculated using a price for the Comparable Treasury Issue (expressed as
a percentage of its principal amount) equal to the Comparable Treasury Price for such Redemption
Date. The Treasury Rate shall be calculated on the third business day preceding the Redemption
Date.

     6. The Notes shall not provide for any sinking fund or analogous provision. None of the Notes
shall be redeemable at the option of the Holder.

     7. The Notes are issuable only in registered form without coupons in denominations of $1,000
and any integral multiple of $1,000 in excess thereof.

     8. The Security Registrar and Paying Agent for the Notes shall be the Trustee.

     9. The principal amount of the Notes shall be payable upon declaration of acceleration
pursuant to Section 502 of the Indenture.

     10. The Notes shall be denominated in and principal of or interest on the Notes (or Make-Whole
Amount, if applicable) shall be payable in such coin or currency of the United States of America as
at the time of payment is legal tender for payment of public and private debts.

     11. Except as provided in paragraph 5 of this Chief Executive Officer’s Certificate the amount
of payments of principal of or interest on the Notes (or Make-Whole Amount, if applicable) shall
not be determined with reference to an index or formula.

     12. None of the principal of or interest on the Notes (or Make-Whole Amount, if applicable)
will be payable at the election of the Company or a Holder thereof in a currency or currencies,
currency unit or units or composite currency or currencies other than that in which the Notes are
denominated or stated to be payable.

     13. Except as set forth in the Indenture or the Trust Indenture Act of 1939, the Notes shall
not contain any provisions granting special rights to the Holders of Notes upon the occurrence of
specified events.

     14. The Notes shall not contain any deletions from, modifications of or additions to the
Events of Default or covenants of the Company contained in the Indenture (as supplemented through
the Ninth Supplemental Indenture).

     15. The Notes shall be issued in the form of permanent global Securities as set forth in
Section 305 of the Indenture.

     16. The Notes will not be issued in the form of Bearer Securities or temporary global
Securities.

 

 

     17. Sections 1402 and 1403 of the Indenture shall be applicable to the Notes.

     18. The Notes will not be issued upon the exercise of debt warrants.

     19. The Notes shall not provide for the payment of Additional Amounts.

     20. The other terms and conditions of the Notes shall be substantially as set forth in the
Indenture, in the Prospectus Supplement dated October 27, 2009 and in the Prospectus dated October
27, 2009 relating to the Notes.

     The undersigned approves in all respects the terms and conditions of the Underwriting
Agreement, dated October 27, 2009, entered into by and among Banc of America Securities LLC,
Citigroup Global Markets Inc. and Goldman, Sachs & Co., as representatives of the underwriters
named in Schedule A thereto and the Company.

[The remainder of this page intentionally left blank.]

 

 

     Dated: October 30, 2009

	 	 	 	 	 
	 	PROLOGIS

 	 
	 	By:  	/s/ Walter C. Rakowich
 	 
	 	 	Walter C. Rakowich 	 
	 	 	Chief Executive Officer 	 
	 
	 	 	 
	 	By:  	                            /s/ Edward S. Nekritz
 	 
	 	 	Edward S. Nekritz 	 
	 	 	Secretary

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