Document:

EX-10.4 Preferred Stock Agreement

 

EXHIBIT 10.4

PREFERRED STOCK EXCHANGE AGREEMENT

     This Preferred Stock Exchange Agreement (this “Agreement”), is entered into as of July
19, 2006, by and among New Horizons Worldwide, Inc., a Delaware corporation (the
“Company”), Camden Partners Strategic Fund III, L.P., a Delaware limited partnership
(“Camden III”), and Camden Partners Strategic Fund III-A, L.P., a Delaware limited
partnership (“Camden III-A” and collectively together with Camden III, “Camden”).

WITNESSETH:

     WHEREAS, the Company and Camden are parties to that certain Series A Stock Purchase Agreement
dated February 7, 2005 (the “Stock Purchase Agreement”) pursuant to which the Company
issued shares of the Company’s Series A Convertible Preferred Stock, no par value per share (the
“Series A Stock”);

     WHEREAS, the Stock Purchase Agreement contains certain covenants regarding the continued
listing of the Company’s common stock on the Nasdaq National Market, among other things;

     WHEREAS, the Company’s common stock was delisted by Nasdaq on July 22, 2005;

     WHEREAS, Camden has agreed to make a loan to the Company in the amount of $1,000,000 (the
“Loan”), and it is a condition to the making of the Loan by Camden that the Company enter
into this Agreement pursuant to which the Company shall exchange the Series A Stock held by Camden
for newly issued shares of the Company’s Series B Convertible Preferred Stock, no par value per
share (the “Series B Stock”), subject to the terms and conditions of this Agreement.

     NOW, THEREFORE, in consideration for the mutual promises set forth herein and for other good
and valuable consideration, the parties hereto agree as follows:

	I.	 	REPRESENTATIONS OF CAMDEN

     Camden III and Camden III-A each hereby represent and warrant to the Company as follows:

	 	1.	 	Binding Agreement. This Agreement has been duly executed and delivered
by it and constitutes its legal, valid and binding agreement enforceable in accordance
with its terms subject to general principles of equity and to bankruptcy, insolvency
and other similar laws affecting the enforcement of creditors’ rights generally.
	 
	 	2.	 	Due Authorization. It has all requisite limited partnership power and
authority to enter into this Agreement, and the execution and delivery of this
Agreement by it

 

 

	 	 	 	and the performance of its covenants and agreements hereunder have been duly
authorized by all necessary limited partnership action.

	II.	 	REPRESENTATIONS OF THE COMPANY

     The Company hereby represents and warrants to Camden as follows:

	 	1.	 	Binding Agreement. This Agreement has been duly executed and delivered
by the Company and constitutes a legal, valid and binding agreement of the Company,
enforceable against the Company in accordance with its terms, subject to general
principles of equity and to bankruptcy, insolvency and other similar laws affecting the
enforcement of creditors’ rights generally.
	 
	 	2.	 	Due Authorization. The Company has all requisite corporate power and
authority to enter into this Agreement. The execution and delivery of this Agreement
by the Company and the performance by the Company of its covenants and agreements
hereunder have been duly authorized by all necessary corporate action on the part of
the Company.
	 
	 	3.	 	Offering. Subject to the truth and accuracy of Camden’s
representations as set forth in Article III of this Agreement, the issuance of the
Series B Stock is exempt from the registration requirements of the Securities Act of
1933, as amended (the “Securities Act”).
	 
	 	4.	 	Capitalization. As of the date hereof, the authorized capital stock of
the Company consists of (x) 20,000,000 shares of the common stock, $.01 par value per
share, of the Company (the “Common Stock”), of which as of the date hereof,
10,801,378 shares are issued and outstanding, 185,280 shares are held in treasury, and
2,286,000 shares are reserved for issuance pursuant to the Company’s incentive plans
and other options outstanding, and (y) 2,000,000 shares of preferred stock, of which
(i) 1,638,398 are designated as Series A Stock, all of which are issued and outstanding
as of the date hereof, and (ii) 200,000 are designated as Series B Stock, none of which
are issued and outstanding immediately prior to the exchange contemplated by Article IV
of this Agreement. All of such outstanding shares have been, or upon issuance will be,
validly issued and are fully paid and nonassessable. Except as set forth on
Schedule 1: (i) no shares of the Company’s capital stock are subject to
preemptive rights or any other similar rights or any liens or encumbrances suffered or
permitted by the Company; (ii) there are no outstanding options, warrants, scrip,
rights to subscribe to, calls or commitments of any character whatsoever relating to,
or securities or rights convertible into, or exercisable or exchangeable for, any shares of capital stock of the Company or any of its subsidiaries,
or contracts,
commitments, understandings or arrangements by which the Company or any of its
subsidiaries

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is or may become
bound to issue additional shares of capital stock of the Company or any of its
subsidiaries or options, warrants, scrip, rights to subscribe to, calls or
commitments of any character whatsoever relating to, or securities or rights
convertible into, or exercisable or exchangeable for, any shares of capital stock of
the Company or any of its subsidiaries; and (iii) there are no securities or
instruments containing anti-dilution or similar provisions that will be triggered by
the issuance of the Series B Stock. The Company has furnished to Camden true,
correct and complete copies of the Company’s Restated Certificate of Incorporation,
as amended and as in effect on the date hereof (the “Certificate of
Incorporation”), and the Company’s Amended and Restated Bylaws, as amended and
as in effect on the date hereof (the “Bylaws”), and the terms of all
securities convertible into, or exercisable or exchangeable for, Common Stock and
the material rights of the holders thereof in respect thereto.

	III.	 	INVESTMENT REPRESENTATIONS

        Camden III and Camden III-A each hereby represent and warrant to, and agree with, the Company
that:

	 	1.	 	No Registration Under the Securities Act. It understands that the
Series B Stock to be acquired by it pursuant to the terms of this Agreement and the
Common Stock of the Company into which the Series B Stock is convertible (collectively,
the “Securities”) have not been registered under the Securities Act or any
state securities law and will be issued in reliance upon exemptions contained in the
Securities Act or interpretations thereof and in the applicable state securities laws,
and cannot be offered for sale, sold or otherwise transferred unless the Securities are
so registered or qualify for exemption from registration under the Securities Act.
	 
	 	2.	 	Acquisition for Investment. The Securities are being acquired under
this Agreement by it in good faith solely for its own account, for investment and not
with a view toward resale or other distribution within the meaning of the Securities
Act. The Securities will not be offered for sale, sold or otherwise transferred by it
without either registration or exemption from registration under the Securities Act and
any applicable state securities laws.
	 
	 	3.	 	Evaluation of Merits and Risks of Investment. It has such knowledge
and experience in financial and business matters such that it is capable of evaluating
the merits and risks of its investment in the Securities being acquired hereunder. It
is an “accredited investor” within the meaning of Rule 501(a) under the Securities Act.
It understands and is able to bear any economic risks associated with such investment
(including, without limitation, the necessity of holding the 

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	 	 	 	Securities for
an indefinite period of time, inasmuch as the Securities have not been registered
under the Securities Act).

	 	4.	 	Additional Information. It has been afforded an opportunity to ask
questions and receive answers concerning the Company and has received all additional
information that it has requested.
	 
	 	5.	 	Legend. The certificates evidencing the Securities will bear a legend
substantially similar to the following:

THE SECURITIES REPRESENTED HEREBY HAVE NOT BEEN REGISTERED UNDER THE SECURITIES
ACT OF 1933, AS AMENDED (THE “ACT”), OR ANY STATE SECURITIES LAWS, MAY NOT BE
SOLD, TRANSFERRED OR OTHERWISE DISPOSED OF IN THE ABSENCE OF (I) AN EFFECTIVE
REGISTRATION STATEMENT FOR THE SECURITIES UNDER SUCH ACT AND ANY APPLICABLE
STATE SECURITIES LAW, (II) A “NO ACTION” LETTER OF THE SECURITIES AND EXCHANGE
COMMISSION WITH RESPECT TO SUCH SALE OR OFFER, OR (III) AN OPINION OF COUNSEL
REASONABLY SATISFACTORY TO THE COMPANY THAT REGISTRATION UNDER SUCH ACT AND ANY
APPLICABLE STATE SECURITIES LAW IS NOT REQUIRED WITH RESPECT TO SUCH SALE OR
OFFER.

In addition, for so long as the referenced Stockholders’ Agreement is in effect,
each such certificate shall also bear a legend substantially similar to the
following:

THE VOTING RIGHTS AND OBLIGATIONS WITH RESPECT TO, AND SALE OR OTHER DISPOSITION
OF, THE SECURITIES REPRESENTED BY THIS CERTIFICATE ARE RESTRICTED BY AND SUBJECT
TO THE PROVISIONS OF AN AMENDED AND RESTATED STOCKHOLDERS’ AGREEMENT DATED AS OF
JULY 19, 2006, A COPY OF WHICH IS AVAILABLE FOR INSPECTION AT THE OFFICES OF THE
COMPANY.

	 	6.	 	Other Securities. Neither Camden III, Camden III-A nor any affiliate
thereof owns any Common Stock of the Company.

	IV.	 	THE EXCHANGE

	 	1.	 	Surrender of Series A Stock. Concurrently with the execution of this
Agreement, Camden has surrendered the certificates representing the Series A Stock to
the Company for cancellation, together with duly endorsed stock transfer powers in the
form previously requested by the Company.

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	 	2.	 	Issuance of Series B Stock. In exchange for the surrender of the
Series A Stock by Camden, concurrently with the execution of this Agreement, the
Company has issued to Camden the shares of Series B Stock in the amounts set forth on
Exhibit A.
	 
	 	3.	 	Acknowledgement. Each of Camden III and Camden III-A hereby
represents, acknowledges and agrees that the shares of Series B Stock received thereby
in the exchange described in paragraph 2 above include 10,421 shares (in the case of
Camden III) and 433 shares (in the case of Camden III-A), which shares are being
delivered in full satisfaction of, and as consideration for, the release by Camden III
and Camden III-A of any claims relating to the accrued but unpaid dividends on the shares of Series A Stock surrendered and the interest accrued on such unpaid dividends.

	V.	 	RELEASE

	 	1.	 	Release By Camden. Effective as of the completion of the exchange and
for good and valuable consideration, the receipt and adequacy of which is hereby
acknowledged, each of Camden III and Camden III-A, on its behalf and on behalf of its
partners, agents, employees, successors and assigns, hereby releases, waives and
discharges the Company and its officers, directors, stockholders, agents, successors
and assigns from any and all actions, causes of action, suits, debts, dues, sums of
money, accounts, reckonings, bonds, bills, specialties, covenants, contracts,
controversies, agreements, promises, variances, trespasses, damages, judgments,
extents, executions, claims and demands whatsoever, known or unknown, liquidated or
contingent, matured or unmatured, in law or equity, heretofore or hereafter existing
under, arising out of or relating in any way to the Stock Purchase Agreement. Camden
III and Camden III-A each agree and promise that it will not file any lawsuit asserting
any claims and shall not assist any other person in connection with the pursuit of any
claim that could not be brought by it hereunder, except in the case of a court order or
validly issued subpoena. This release shall not apply to the Registration Rights
Agreement dated as of February 7, 2005 among the Company and Camden (the “Registration
Rights Agreement”) or the Stockholders’ Agreement dated as of February 7, 2005 among
the Company and Camden (the “Stockholders’ Agreement”), each as may be amended from
time to time in accordance with their terms, or the Company’s obligations under this
Agreement; provided, however, that each of Camden III and Camden III-A hereby waives
any defaults by the Company under the Registration Rights Agreement and/or the
Stockholders’ Agreement existing on or before the date hereof. In addition, Camden III
and Camden III-A acknowledge and confirm that nothing in this Agreement shall limit or
affect in

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	 	 	 	any way the responsibilities of any Camden affiliate serving on the Board of
Directors of the Company in discharging his fiduciary obligations.
	 
	 	2.	 	Release by the Company. Effective as of the completion of the exchange
and for good and valuable consideration, the receipt and adequacy of which is hereby
acknowledged, the Company, on its behalf and on behalf of its partners, agents,
employees, successors and assigns, hereby releases, waives and discharges each of
Camden III and Camden III-A, and its officers, directors, stockholders, partners,
members, agents, successors and assigns from any and all actions, causes of action,
suits, debts, dues, sums of money, accounts, reckonings, bonds, bills, specialties,
covenants, contracts, controversies, agreements, promises, variances, trespasses,
damages, judgments, extents, executions, claims and demands whatsoever, known or
unknown, liquidated or contingent, matured or unmatured, in law or equity, heretofore
or hereafter existing under, arising out of or relating in any way to the Stock
Purchase Agreement. The Company agrees and promises that it will not file any lawsuit
asserting any claims and shall not assist any other person in connection with the
pursuit of any claim that could not be brought by the Company hereunder, except in the
case of a court order or validly issued subpoena. This release shall not apply to the
Registration Rights Agreement or the Stockholders’ Agreement, each as may be amended
from time to time in accordance with their terms, or the obligations of Camden III or
Camden III-A under this Agreement.

	VI.	 	MISCELLANEOUS

	 	1.	 	Entire Agreement. This Agreement constitutes the sole understanding of
the parties with respect to the subject matter hereof. No amendment, modification or
alteration of the terms or provisions of this Agreement shall be binding unless the
same shall be in writing and duly executed by the parties hereto, provided that the
foregoing shall not be deemed to supersede or void any provision of the Registration
Rights Agreement or the Stockholders’ Agreement.
	 
	 	2.	 	Parties Bound by Agreement; Successors and Assigns. The terms,
conditions and obligations of this Agreement shall inure to the benefit of and be
binding upon the parties hereto and their respective heirs, representatives successors
and assigns. Without the prior written consent of the other parties hereto, no party
may assign its rights, duties or obligations hereunder or any part thereof to any other
person or entity.
	 
	 	3.	 	Counterparts. This Agreement may be executed in two or more
counterparts, each of which shall for all purposes be deemed to be an original and all
of which shall constitute the same instrument.

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	 	4.	 	Headings. The headings of the articles, sections and paragraphs of
this Agreement are inserted for convenience only and shall not be deemed to constitute
part of this Agreement or to affect the construction hereof.
	 
	 	5.	 	Modification and Waiver. Any of the terms or conditions of this
Agreement may be waived in writing at any time by the party which is entitled to the
benefits thereof. No waiver of any of the provisions of this Agreement shall be deemed
to or shall constitute a waiver of any other provision hereof (whether or not similar).
	 
	 	6.	 	Governing Law; Construction. This agreement shall be construed in
accordance with and governed by the laws of the State of Delaware without giving effect
to the principles of conflicts of law thereof. No provision of this agreement or any
related document shall be construed against or interpreted to the disadvantage of any
party hereto by any court or other governmental or judicial authority by reason of such
party’s having or being deemed to have structured or drafted such provision.
	 
	 	7.	 	No Third-Party Beneficiaries. With the exception of the parties to
this Agreement and their permitted successors and assigns, there shall exist no right
of any person to claim a beneficial interest in this Agreement or any rights occurring
by virtue of this Agreement.
	 
	 	8.	 	Severability. In the event that any provision hereof would, under
applicable law, be invalid or enforceable in any respect, such provision shall be
construed by modifying or limiting it so as to be valid and enforceable to the maximum
extent compatible with, and permissible under, applicable law. The invalidity or
unenforceability of any provision of this Agreement shall not affect the validity or
enforceability of any other provision of this Agreement which shall remain in full
force and effect.

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     IN WITNESS WHEREOF, each of the parties hereto has caused this Agreement to be executed on its
behalf on the date first written above.

	 	 	 	 	 	 	 
	 	 	NEW HORIZONS WORLDWIDE, INC.	 	 
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ Thomas J. Bresnan
 

Name: Thomas J. Bresnan
	 	 
	 

	 	 	 	Title: President	 	 
	 
	 	 	 	 	 	 
	 	 	CAMDEN PARTNERS STRATEGIC FUND III, L.P.	 	 
	 	 	By: CAMDEN PARTNERS STRATEGIC III, LLC, its	 	 
	 	 	General Partner	 	 
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ David L. Warnock
 

David L. Warnock, Managing Member
	 	 
	 
	 	 	 	 	 	 
	 	 	CAMDEN PARTNERS STRATEGIC FUND III-A, L.P.	 	 
	 	 	By: CAMDEN PARTNERS STRATEGIC III, LLC, its	 	 
	 	 	General Partner	 	 
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ David L. Warnock
 

David L. Warnock, Managing Member
	 	 

 

Exhibit A

	 	 	 	 	 
	 	 	No. of Shares of	 
	 	 	Series B Stock	 
	Camden Partners Strategic Fund III, L.P.
	 	 	167,723	 
	 
	 	 	 	 
	Camden Partners Strategic Fund III-A, L.P.
	 	 	6,970EX-10.5 Amended and Restated Stockholders Agrmt

 

Exhibit 10.5

AMENDED AND RESTATED

STOCKHOLDERS’ AGREEMENT

AMONG

NEW HORIZONS WORLDWIDE, INC.

AND

THE PARTIES LISTED ON EXHIBITS HERETO

DATED JULY 19, 2006

 

 

AMENDED AND RESTATED STOCKHOLDERS’ AGREEMENT

     THIS AMENDED AND RESTATED STOCKHOLDERS’ AGREEMENT (this “Agreement”) is entered into as of
July 19, 2006 by and among New Horizons Worldwide, Inc., a Delaware corporation (the “Company”),
Camden Partners Strategic Fund III, L.P., a Delaware limited partnership, Camden Partners Strategic
Fund III-A, L.P., a Delaware limited partnership (collectively, “Camden”), the other parties
identified as Series B Preferred Stockholders on Exhibit B hereto, as may be amended from
time to time (collectively with Camden, the “Series B Preferred Stockholders”), Alkhaleej Training
and Education Corporation, a company formed under the laws of the Kingdom of Saudi Arabia
(“Alkhaleej”), and the holders of certain Warrants issued by the Company as of the date hereof as
identified on Exhibit C hereto, as may be amended from time to time (collectively,
including any permitted subsequent holders hereafter, the “Warrant Holders” and together with the
Series B Preferred Stockholders, the “Holders”).

     WHEREAS, the Company and Camden entered into that certain Stockholders’ Agreement dated as of
February 7, 2005 (the “Stockholders’ Agreement”); and

     WHEREAS, in connection with the extension of credit to the Company by the Warrant Holders (the
“Loan”), (i) the Company shall issue to each Warrant Holder Series A Warrants and Series B Warrants
(collectively, the “Warrants”) to purchase common stock of the Company, (ii) the Company and Camden
shall exchange all issued and outstanding Series A Preferred Stock held by Camden for shares of
Series B Convertible Preferred Stock pursuant to that certain Preferred Stock Exchange Agreement of
even date herewith and (iii) it is a condition precedent that the parties hereto amend and restate
the Stockholders’ Agreement in order to provide, among other things, for certain rights and
responsibilities as set forth herein.

     NOW, THEREFORE, for and in consideration of the foregoing and of the mutual covenants and
agreements hereinafter set forth, the parties hereto agree as follows:

1. DEFINITIONS

     For all purposes of this Agreement, capitalized terms specified in Exhibit A shall
have the meanings set forth in Exhibit A, except as otherwise expressly provided herein.

2. DIRECTORS OF THE COMPANY

     In accordance with the Charter of the Company, three directors of the Company shall be elected
by the holders of the Series B Convertible Preferred Stock (the “Series B Preferred Directors” and
each a “Series B Preferred Director”) and all other directors of the Company shall be elected by
the holders of the Common Stock and the Series B Convertible Preferred Stock voting together as a
single class (on an as converted basis) (the “Common Directors”).

     Until this Agreement is terminated as provided herein, the Company, Alkhaleej, each Series B
Preferred Stockholder (for so long as such Series B Preferred Stockholder owns any security of the
Company) and each Warrant Holder (at such time and so long thereafter as each such Warrant Holder
owns any securities of the Company) shall take or cause to be taken all

 

 

reasonably necessary actions within its respective power and authority and in accordance with
applicable law as may be required to effect the agreements contained in this Section 2.

     2.1. Board of Directors

          (a) For so long as the holders of the Series B Convertible Preferred Stock are entitled to
nominate and elect Series B Preferred Directors as set forth in the Charter, the Company, each
Series B Preferred Stockholder and each Warrant Holder (at such time and so long thereafter as each
such Warrant Holder owns any securities of the Company) shall take or cause to be taken all
necessary actions as may be required:

               (1) to establish the authorized size of the Board of Directors of the Company at nine (9)
directors;

               (2) to not authorize an increase in the size of the Board of Directors of the Company to
greater than nine (9) directors or a decrease in the size of the Board of Directors to fewer than
seven (7) directors;

               (3) to cause to be elected to the Board of Directors (A) the Series B Preferred Directors
designated in writing from time to time by the holders of a majority of the Series B Convertible
Preferred Stock, such persons initially being Donald Hughes, David L. Warnock and Alwaleed
Aldryann, and (B) the independent director described in Section 2.3 below;

               (4) to maintain the voting requirements for actions of the Board of Directors at a majority of
directors present at a meeting at which there is a quorum, except in respect of such matters as
this Agreement, the Charter or the Bylaws or law may impose a greater voting requirement;

               (5) subject to Section 2.1(b), to cause to be removed forthwith from the Board of Directors
any Series B Preferred Director when removal is requested for any reason, with or without cause, by
the holders of a majority of the Series B Convertible Preferred Stock, and not to remove a Series B
Preferred Director for any other reason during the time of the designation rights of the Series B
Preferred Stockholders under this Section 2;

               (6) in the case of death, resignation, or other removal as herein provided of any Series B
Preferred Director, to elect only another person designated by the holders of a majority of the
Series B Convertible Preferred Stock to fill the vacancy created thereby; and

               (7) to prevent any action from being taken by the Board of Directors of the Company during the
pendency of any vacancy due to death, resignation or removal of any Series B Preferred Director,
unless the Series B Preferred Stockholders shall have failed for a period of five (5) Business Days
after written notice from the Company of the vacancy to designate a replacement.

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          (b) For so long as (i) the Loan is outstanding or (ii) Alkhaleej shall beneficially hold not
less than seventy-five percent (75%) of (x) the Series A Warrants issued to it as of the date
hereof or (y) the common stock issued pursuant to exercise of such Warrants, the Company, Alkhaleej
and each Series B Preferred Stockholder shall take or cause to be taken all necessary actions as
may be required to elect and retain Alwaleed Aldryann as one of the Series B Preferred Directors in
accordance with Subsection 2.1(a) hereof.

          (c) For so long as the holders of the Series B Convertible Preferred Stock are entitled to
nominate and elect Series B Preferred Directors as set forth in the Charter, Camden agrees to vote
all of its shares of securities of the Company for the Common Directors proposed to be elected by
the Board of Directors’ Governance Committee.

     2.2. Board Committees

     For so long as the holders of the Series B Convertible Preferred Stock are entitled to
nominate and elect the Series B Preferred Directors as set forth in the Charter and subject to the
applicable listing standards of any securities exchange on which any of the Company’s securities
are then traded or listed and any applicable Law, the Board of Directors will not establish an
executive committee authorized to exercise the power of the Board of Directors generally unless the
Series B Preferred Directors are granted representation on such committee proportional to its
representation on the Board of Directors, nor will the Board of Directors establish or employ
committees (unless the Series B Preferred Directors are granted proportional representation
thereon) as a means designed to circumvent or having the effect of circumventing the rights of the
Series B Preferred Directors under this Agreement or the Charter to representation on the Board of
Directors.

     2.3. Election of an Additional Independent Director

     Within eighteen (18) months of the date of this Agreement, the Company will cause to be
elected a new independent director (as defined by the applicable listing standards of any
securities exchange on which any of the Company’s securities are then traded or listed (or, if not
so traded or listed, as defined by the applicable listing standards of the NASDAQ), with
appropriate business background in the Company’s industry) who is acceptable to the Series B
Preferred Stockholders to replace one of Stuart Smith, David Goldfinger, Bill Heller or Richard
Osborne as a member of the Company’s Board of Directors.

     2.4 Board Compensation

     The Series B Preferred Directors shall be entitled to receive such cash, equity-linked or
other compensation and expense reimbursement arrangements as shall be provided to each other
non-employee member of the Board of Directors in performing their duties as directors.

     2.5. Board Observer Rights

     For so long as Camden owns twenty-five percent (25%) of the shares of Series B Convertible
Preferred Stock (as adjusted for stock splits, stock combinations and similar events)

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issued on the date hereof, the Company agrees that Camden shall be permitted to send one (1)
representative (the “Representative”) to attend, as a nonvoting observer, all meetings of the
Company’s Board of Directors or committees thereof and, in this respect, the Company shall provide
the Representative copies of all notices, minutes, consents and other materials that it provides to
its directors; provided, however, that the Company reserves the right to exclude
the Representative from access to any material or meeting or portion thereof if the Company in good
faith believes upon the advice of counsel that such exclusion is reasonably necessary to (i)
preserve the attorney-client privilege or (ii) comply with the listing standards of any securities
exchange on which any of the Company’s securities are then listed or traded and any applicable Law,
including without limitation the need to hold periodic executive sessions of the Company’s Board of
Directors.

3. TRANSFER OF EQUITY SECURITIES

     3.1 Permitted Transfers

     Subject to Section 3.2, a Series B Preferred Stockholder may transfer its shares of Series B
Convertible Preferred Stock without restriction. In connection with any transfer under this
Section 3.1, the transferee shall hold such Series B Convertible Preferred Stock subject to the
same restrictions and obligations applicable to its transferor and shall agree in writing to be
bound by the terms of this Agreement. Notwithstanding anything to the contrary contained in this
Section 3.1, no Series B Preferred Stockholder shall be permitted at any time to transfer to any
Person any shares of Series B Convertible Preferred Stock if such transfer would not be in
compliance with the Act or any applicable state securities laws.

     3.2 Right of First Refusal

     If any Series B Preferred Stockholder or any Person who acquires any Series B Convertible
Preferred Stock from a Series B Preferred Stockholder in accordance with Section 3.2 (the
“Transferring Holder”) shall propose to Transfer to any Person (a “Proposed Transferee”) any shares
of Series B Convertible Preferred Stock, such Transfer shall be conditional upon the satisfaction
of the following conditions precedent:

          (a) Such Transferring Holder shall first offer the Series B Convertible Preferred Stock that
it desires to Transfer (the “Offered Securities”) to the Company, at the same price and on the same
terms that the Transferring Holder intends to Transfer the Offered Securities to the Proposed
Transferee. Such offer shall be made by a written notice (the “Notice of Proposed Transfer”)
delivered to the Company not less than twenty (20) days prior to the proposed Transfer. Such
notice shall set forth the identity of the Proposed Transferee, the Offered Securities proposed to
be sold, the terms and conditions of the Proposed Transfer, including price per share, and any
other material terms and conditions or material facts relating to the proposed Transfer. In
addition, the Transferring Holder shall provide to the Company all such other information relating
to the Offered Securities, the Proposed Transferee and the Proposed Transfer as the Company may
reasonably request.

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          (b) Thereafter, the Company shall have the right, exercisable within twenty (20) days after
receipt of the Notice of Proposed Transfer from the Transferring Holder, to purchase from the
Transferring Holder the Offered Securities.

          (c) If the Company does not accept the offer made by the Transferring Holder with respect to
all of the Offered Securities within the time period provided above, then the Transferring Holder
shall have the right for a period of sixty (60) days following the aforementioned twenty (20) day
period, to Transfer all, but not less than all, of such Offered Securities, but only to the
Proposed Transferee, at not less than the price, and upon terms not more favorable to the Proposed
Transferee, than were contained in the Notice of Proposed Transfer. Offered Securities not sold
within such 60-day period shall continue to be subject to the requirements of this Section 3.2.

4. PREEMPTIVE RIGHTS

     (a) The Company hereby grants to each Series B Preferred Stockholder who owns at least 10,000
shares of Series B Convertible Preferred Stock (as adjusted for stock splits, stock combinations
and similar events) and each Warrant Holder the right (but not the obligation) to purchase its pro
rata share of any New Securities that the Company may, from time to time, propose to sell and
issue. Each Holder’s pro rata share, for purposes of this right, is the ratio of the number of
shares of Common Stock Equivalents then held by the Series B Preferred Stockholder or Warrant
Holder immediately prior to the issuance of the New Securities, on an as converted basis, and the
number of shares of Common Stock Equivalents outstanding (whether vested or unvested) immediately
prior to the issuance of the New Securities, on an as converted basis. For purposes of this
Section 4, “New Securities” shall mean any common stock or preferred stock of the Company, whether
now authorized or not, and rights, options or warrants to purchase such common stock or preferred
stock, and securities of any type whatsoever that are, or by their terms may become, convertible
into common stock or preferred stock of the Company, but shall not include: (i) shares of Common
Stock to be issued upon conversion of the Series B Convertible Preferred Stock, (ii) shares of
Common Stock, warrants, options and other rights to purchase shares of Common Stock and securities
convertible into shares of Common Stock, issued to officers, directors and employees of, and
consultants to, the Corporation as compensation for bona fide services provided or to be provided
to the Company by such persons and approved by the Board of Directors or the Compensation
Committee, as the case may be and (iii) an aggregate of 75,000 shares of Common Stock or Common
Stock issuable upon the exercise of options, warrants or other rights of the Company issued to
financial institutions or lessors in connection with commercial credit transactions, equipment
financings or similar transactions approved by the Board of Directors, and the issuance of Common
Stock upon the exercise of any such options, warrants or other rights.

     (b) In the event the Company proposes to undertake an issuance of New Securities, it shall
give the Holders eligible to exercise rights under this Section 4 written notice of its intention,
describing the type of New Securities, the price and the general terms upon which the Company
proposes to issue the same (a “Sale Notice”). Each Holder shall have thirty (30) days from the
date of receipt of any such Sale Notice to elect to purchase all or a portion of its pro rata share
of the New Securities for the price and upon the general terms specified in the Sale Notice

5

 

by giving written notice to the Company and stating therein the quantity of New Securities to be
purchased.

     (c) In the event the Holders fail to exercise fully the rights granted hereunder within the
30-day period, the Company shall have ninety (90) days to effect the sale of the New Securities at
a price and on terms substantially the same as those offered to the Holders in the Sale Notice. In
the event the sale is not effected within the 90-day period, the Company shall not issue and sell
the New Securities without again offering the New Securities to the Holders in the manner provided
in this Section 4.

     (d) Notwithstanding Section 6.4 below, each Series B Preferred Stockholder may, from time to
time, assign its rights under this Section 4 or any portion thereof to any of its Affiliates who
agree to be bound under this Agreement. The aggregate pro rata share of each Series B Preferred
Stockholder and its Affiliates as a group (a “Stockholder Group”) shall be equal for all purposes
to the number of securities which would have constituted the pro rata share of such Series B
Preferred Stockholder had no such assignment been effected, and may be allocated among the members
of the Stockholder Group in any manner agreed upon by the Stockholder Group. For purposes of this
Section 4, the definition of “Affiliate” shall only include affiliated entities and shall not
include individuals.

     (e) Notwithstanding the foregoing, (i) in the event that the Board of Directors determines in
good faith that the Company may be adversely affected by a delay in closing the sale of the New
Securities, holders of a majority of each of the Series B Convertible Preferred Stock and Warrant
Holders with such rights granted hereunder may waive the rights granted in this Section 4 on behalf
of all Series B Preferred Stockholders and Warrant Holders with such rights granted hereunder prior
to the end of the 30-day period and upon receipt of the acceptances or waivers described herein,
the Company shall be free to consummate the issuance and sale of the New Securities and (ii) in no
event shall the Company be required to sell any New Securities to a Holder that is not an
“accredited investor” as such term is defined under the Act at the time of such proposed sale.

5. ADDITIONAL COVENANTS OF THE COMPANY

     The Company hereby covenants as set forth in the following subsections with each Series B
Preferred Stockholder as follows:

     5.1. Financial and Business Information

     For so long as the Series B Preferred Stockholders own at least fifty percent (50%) of the
Series B Convertible Preferred Stock issued on the date hereof, the Company shall furnish to the
Series B Preferred Stockholders:

          (1) as soon as available and in any event within seventy-five (75) days after the end of each
fiscal year of the Company (or such shorter period as may be prescribed by law or regulation with
respect to annual filings on Form 10-K), a copy of the audited balance sheet of the Company as of
the end of such fiscal year and the related audited statements of income and

6

 

cash flows for the fiscal year, all prepared in reasonable detail, and certified by independent
certified public accountants of recognized national standing as presenting fairly in all material
respects the financial position of the Company and approved by the Board of Directors of the
Company, including footnotes and setting forth in comparative form the corresponding figures for
the corresponding period of the preceding fiscal year, prepared in accordance with GAAP,
consistently applied;

          (2) as soon as available and in any event within forty (40) days after the end of each fiscal
quarter of the Company (or such shorter period as may be prescribed by law or regulation with
respect to quarterly filings on Form 10-Q) (other than the last quarter of each fiscal year), a
copy of the unaudited balance sheet of the Company as of the end of the quarter and the related
unaudited statements of income and cash flows of the Company for the periods commencing at the end
of the previous quarter and ending at the end of the quarter and commencing at the beginning of the
fiscal year and ending at the end of the quarter, in each case setting forth in comparative form
the corresponding figures for the corresponding period of the preceding fiscal year, prepared in
accordance with GAAP, consistently applied, subject only to year-end audit adjustments, except that
such financial statements need not contain the notes required by GAAP, and certified by the
principal financial or accounting officer of the Company and accompanied by a narrative management
discussion and analysis of the operating results and financial condition;

          (3) within thirty (30) days after the end of each calendar month, a copy of the unaudited
balance sheet of the Company as of the end of the month and the related unaudited statements of
income and cash flows of the Company for the periods commencing at the end of the previous month
and ending at the end of the month and commencing at the beginning of the fiscal year and ending at
the end of the month, in each case setting forth in comparative form the corresponding figures for
the corresponding period of the preceding fiscal year, prepared in accordance with GAAP,
consistently applied, subject only to year-end audit adjustments, except that such financial
statements need not contain the notes required by GAAP, and certified by the principal financial or
accounting officer of the Company and accompanied by a narrative management discussion and analysis
of the operating results and financial condition;

          (4) as soon as available and in any event no later than thirty (30) days after the first day
of each fiscal year of the Company beginning after the date hereof, an annual operating plan and
budget (including cash flow data) for the Company for the fiscal year, each prepared in reasonable
detail, including monthly projections, as each operating plan and budget has been approved by the
Board of Directors of the Company;

          (5) as soon as available, monthly updates to the information provided in subsection (4) above;

          (6) at least annually, letters from the Company’s independent accountants regarding the
sufficiency of internal controls and other matters customarily addressed in “management letters”;

7

 

          (7) Within five days after receipt, a copy of any notification received by the Company
regarding (i) any defaults on any material contracts, loans or leases to which the Company is a
party or (ii) (A) any material litigation filed against the Company or (B) any overtly threatened
litigation that the Company reasonably believes may be filed against the Company and may have a
material adverse effect on the condition (financial or other), business, results of operations,
ability to conduct business or properties of the Company and its subsidiaries, taken as a whole;
and

          (8) promptly, from time to time, such other information (in writing if so required) regarding
the assets and properties and operations, business affairs, profit and loss statements, budgets,
initial projections and financial condition of the Company as Camden may reasonably request.

     5.2. Restrictive Agreements Prohibited

     The Company shall not become a party to any agreement which by its terms or effects restricts
or hinders the Company’s performance of, or obligations pursuant to, this Agreement, the
Registration Rights Agreement, the Charter or the Bylaws.

6. MISCELLANEOUS

     6.1. Legend

     The certificates or other evidence representing the Series B Convertible Preferred Stock shall
bear a legend (the “Legend”) in substantially the following form:

THE VOTING RIGHTS AND OBLIGATIONS WITH RESPECT TO, AND SALE OR OTHER
DISPOSITION OF, THE SECURITIES REPRESENTED BY THIS CERTIFICATE ARE
RESTRICTED BY AND SUBJECT TO THE PROVISIONS OF AN AMENDED AND RESTATED
STOCKHOLDERS’ AGREEMENT DATED AS OF JULY 19, 2006, A COPY OF WHICH IS
AVAILABLE FOR INSPECTION AT THE OFFICES OF THE COMPANY.

THE SECURITIES REPRESENTED HEREBY HAVE NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED (THE “ACT”), OR ANY STATE SECURITIES
LAWS, MAY NOT BE SOLD, TRANSFERRED OR OTHERWISE DISPOSED OF IN THE ABSENCE
OF (I) AN EFFECTIVE REGISTRATION STATEMENT FOR THE SECURITEIS UNDER SUCH
ACT AND ANY APPLICABLE STATE SECURITIES LAW, (II) A “NO ACTION” LETTER OF
THE SECURITIES AND EXCHANGE COMMISSION WITH RESPECT TO SUCH SALE OR OFFER,
OR (III) AN OPINION OF COUNSEL REASONABLY SATISFACTORY TO THE COMPANY THAT
REGISTRATION UNDER SUCH ACT AND ANY APPLICABLE STATE SECURITIES

8

 

LAW IS NOT REQUIRED WITH RESPECT TO SUCH SALE OR OFFER.

     6.2. Specific Performance

     In addition to any other remedies which the Series B Preferred Stockholders may have at law or
in equity, the Company and the Series B Preferred Stockholders hereby acknowledge that the harm
which might result to the Series B Preferred Stockholders from breaches by the Company or the
Series B Preferred Stockholders of their respective obligations to take all necessary actions with
respect to the election and the removal of directors of the Company cannot be adequately
compensated by damages. Accordingly, the Company and each Series B Preferred Stockholder agrees
that each other Series B Preferred Stockholder shall have the right to have all obligations and
undertakings set forth in Section 2 specifically performed by the Company or the other Series B
Preferred Stockholders, as the case may be, and that any other Series B Preferred Stockholder shall
have the right to obtain an order or decree of such specific performance in any of the courts of
the United States of America or of any state or other political subdivision thereof.

     6.3. Termination

     Unless earlier terminated as provided herein, this Agreement, and the agreements, covenants
and obligations of the parties hereunder, shall forthwith terminate and become wholly void and of
no effect at such time as (i) there are less twenty-five percent (25%) of the Series B Convertible
Preferred Stock issued on the date hereof outstanding (subject to adjustment for splits,
combinations and the like) and (ii) Section 2.1(b) is no longer applicable.

     6.4. Assignment

     Except as expressly contemplated by Section 3, neither the Company nor any Series B Preferred
Stockholder shall assign this Agreement, in whole or in part, whether by operation of law or
otherwise, unless such person shall have obtained the prior written consent of all the other
parties. Any purported assignment of this Agreement contrary to the terms hereof shall be null and
void and of no force and effect.

     6.5. Entire Agreement; Amendment; and Waivers

     This Agreement, including the Exhibits hereto, constitutes the entire agreement among the
parties hereto with respect to the matters provided for herein, and it supersedes all prior oral or
written agreements, commitments or understandings with respect to the matters provided for herein.
No amendment, modification or discharge of this Agreement shall be valid or binding unless set
forth in writing and duly executed and delivered by the Company and the holders of the Series B
Convertible Preferred Stock representing a majority of the outstanding shares of Series B
Convertible Preferred Stock. No delay or failure on the part of any party hereto in exercising any
right, power or privilege under this Agreement or under any other instruments given in connection
with or pursuant to this Agreement shall impair any such right, power or privilege or be construed
as a waiver of any default or any acquiescence therein. No single or

9

 

partial exercise of any such right, power or privilege shall preclude the further exercise of such
right, power or privilege, or the exercise of any other right, power or privilege. No waiver shall
be valid against any party hereto unless made in writing and approved by the holders of the Series
B Convertible Preferred Stock representing a majority of the outstanding shares of Series B
Convertible Preferred Stock. Any waiver effected in accordance with this Section 6.5 shall be
binding upon each Series B Preferred Stockholder whether or not they have signed the instrument
providing for such waiver. Upon the effectuation of each such waiver or amendment, the Company
shall promptly give written notice thereof to the Series B Preferred Stockholders who have not
previously consented thereto in writing.

     6.6. No Third Party Beneficiaries

     It is the explicit intention of the parties hereto that no person or entity other than the
parties hereto is or shall be entitled to bring any action to enforce any provision of this
Agreement against any of the parties hereto, and the covenants, undertakings and agreements set
forth in this Agreement shall be solely for the benefit of, and shall be enforceable only by, the
parties hereto or their respective successors, heirs, executors, administrators, legal
representatives and permitted assigns.

     6.7. Binding Effect

     This Agreement shall be binding upon and shall inure to the benefit of the parties hereto and
their respective successors, heirs, executors, administrators, legal representatives and permitted
assigns.

     6.8. Governing Law

     This Agreement, the rights and obligations of the parties hereto, and any claims or disputes
relating thereto, shall be governed by and construed in accordance with the laws of the State of
Delaware (excluding the choice of law rules thereof). Each party hereby irrevocably submits to the
non-exclusive jurisdiction of the state and federal courts sitting in Wilmington, Delaware for the
adjudication of any dispute hereunder or in connection herewith or with any transaction
contemplated hereby or discussed herein, and hereby irrevocably waives, and agrees not to assert in
any suit, action or proceeding, any claim that it is not personally subject to the jurisdiction of
any such court, that such suit, action or proceeding is brought in an inconvenient forum or that
the venue of such suit, action or proceeding is improper. Each party hereby irrevocably waives
personal service of process and consents to process being served in any such suit, action or
proceeding by mailing a copy thereof to such party at the address for such notices to it under this
Agreement and agrees that such service shall constitute good and sufficient service of process and
notice thereof. Nothing contained herein shall be deemed to limit in any way any right to serve
process in any manner permitted by law. EACH PARTY HEREBY IRREVOCABLY WAIVES ANY RIGHT IT MAY HAVE
TO, AND AGREES NOT TO REQUEST, A JURY TRIAL FOR THE ADJUDICATION OF ANY DISPUTE HEREUNDER OR IN
CONNECTION WITH OR ARISING OUT OF THIS AGREEMENT OR ANY TRANSACTION CONTEMPLATED HEREBY.

10

 

     6.9. Notices

     All notices, demands, requests, or other communications which may be or are required to be
given, served, or sent by any party to any other party pursuant to this Agreement shall be in
writing and shall be hand delivered, sent by overnight courier or mailed by first-class, registered
or certified mail, return receipt requested, postage prepaid, addressed as follows:

	 	 	 
	(i)

	 	If to the Company:
	 

	 	New Horizons Worldwide, Inc.
	 

	 	1900 S. State College Blvd., Suite 200
	 

	 	Anaheim, California 92806
	 

	 	Attention: President and Chief Executive Officer
	 
	 	 
	 

	 	with a copy (which shall not constitute notice) to:
	 

	 	Calfee, Halter, & Griswold, LLP
	 

	 	1400 McDonald Investment Center
	 

	 	800 Superior Avenue
	 

	 	Cleveland, Ohio 44114-2688
	 

	 	Attention: Scott R. Wilson
	 
	 	 
	(ii)

	 	If to Camden:
	 

	 	Camden Partners Holdings, LLC
	 

	 	500 East Pratt Street
	 

	 	Suite 1200
	 

	 	Baltimore, MD 21202
	 

	 	Attention: David L. Warnock
	 
	 	 
	 

	 	with a copy (which shall not constitute notice) to:
	 

	 	Hogan & Hartson L.L.P.
	 

	 	111 South Calvert Street. Suite 1600
	 

	 	Baltimore, Maryland 21202
	 

	 	Attention: Thene M. Martin
	 
	 	 
	(iii)

	 	If to any other Series B Preferred Stockholder:
	 
	 	 
	 

	 	To such Series B Preferred Stockholder’s address shown on Exhibit B hereto
	 
	 	 
	(iv)

	 	If to Alkhaleej:
	 
	 	 
	 

	 	Alkhaleej Training & Education Corporation
	 

	 	P.O.Box 295300
	 

	 	Riyadh 11351
	 

	 	Kingdom of Saudi Arabia
	 

	 	Attn: Alwaleed Aldryann
	 
	 	 
	 

	 	With a copy to:

11

 

	 	 	 
	 

	 	Fulbright & Jaworski L.L.P.
	 

	 	555 S. Flower Street, 41st Floor
	 

	 	Los Angeles, CA 90071
	 

	 	Attention: Tim C. Bruinsma
	 
	 	 
	(v)

	 	If to any other Warrant Holder:
	 
	 	 
	 

	 	To such Warrant Holder’s address shown on Exhibit C hereto

Each party may designate by notice in accordance with this Section 6.9 a new address to which any
notice, demand, request or communication may thereafter be so given, served or sent. Each notice,
demand, request, or communication which shall be hand delivered, sent, mailed, in the manner
described above, shall be deemed sufficiently given, served, sent, received or delivered for all
purposes at such time as it is delivered to the addressee (with the return receipt or the delivery
receipt being deemed conclusive, but not exclusive, evidence of such delivery) or at such time as
delivery is refused by the addressee upon presentation.

     6.10. Aggregation of Stock

     All Common Stock Equivalents held or acquired by affiliated entities or persons shall be
aggregated together for the purpose of determining the availability of any rights under this
Agreement.

     6.11 Execution in Counterparts

     To facilitate execution, this Agreement may be executed in as many counterparts as may be
required; and it shall not be necessary that the signatures of, or on behalf of, each party, or
that the signatures of all persons required to bind any party, appear on each counterpart; but it
shall be sufficient that the signature of, or on behalf of, each party, or that the signatures of
the persons required to bind any party, appear on one or more of the counterparts. All
counterparts shall collectively constitute a single agreement. It shall not be necessary in making
proof of this Agreement to produce or account for more than a number of counterparts containing the
respective signatures of, or on behalf of, all of the parties hereto.

[Signatures Appear on Following Pages]

12

 

     IN WITNESS WHEREOF, the undersigned have duly executed this Stockholders’ Agreement, or have
caused this Stockholders’ Agreement to be duly executed on their behalf, as of the day and year
first hereinabove set forth.

	 	 	 	 	 
	 	NEW HORIZONS WORLDWIDE, INC.

 	 
	 	By:  	/s/  Thomas Bresnan
 	 
	 	Name:	 Thomas Bresnan 	 
	 	Title:	President	 
	 
	 	HOLDERS:

CAMDEN PARTNERS STRATEGIC FUND III, L.P.

By: CAMDEN PARTNERS STRATEGIC III, LLC, its General

Partner

 	 
	 	By:  	/s/  David L. Warnock
 	 
	 	 	David L. Warnock, Managing Member 	 
	 
	 	CAMDEN PARTNERS STRATEGIC FUND III-A, L.P.

By: CAMDEN PARTNERS STRATEGIC III, LLC, its General

Partner

 	 
	 	By:  	/s/  David L. Warnock
 	 
	 	 	David L. Warnock, Managing Member 	 
	 
	 	ALKHALEEJ TRAINING AND EDUCATION

CORPORATION

 	 
	 	By:  	/s/  Alwaleed Aldryann
 	 
	 	Name:	 Alwaleed Aldryann 	 
	 	Title:	President 	 
	 
	 	GEORGE S. RICH

 	 
	 	/s/  George S. Rich
 	 
	 	George S. Rich 	 
	 	 	 
	 

 

 

EXHIBIT A

DEFINITIONS

          “Act” shall mean the Securities Act of 1933, as amended.

          “Affiliate” shall mean: (a) with respect to a person, any member of such person’s family; (b)
with respect to an entity, any officer, director, Stockholder, partner or investor of or in such
entity or of or in any Affiliate of such entity; and (c) with respect to a person or entity, any
person or entity which directly or indirectly, through one or more intermediaries, controls, is
controlled by, or is under common control with such person or entity.

          “Agreement” shall mean this Amended and Restated Stockholders’ Agreement.

          “Business Day” shall mean Monday through Friday and shall exclude any federal or religious
holidays.

          “Bylaws” shall mean the Company’s Amended and Restated Bylaws of the Company.

          “Charter” shall mean the Restated Certificate of Incorporation of the Company as supplemented,
amended and/or restated from time to time.

          “Common Stock” shall mean the common stock, $.01 par value, of the Company.

          “Common Stock Equivalent” shall mean a share of Common Stock, or the right to acquire, whether
or not immediately exercisable, a share of Common Stock, whether evidenced by an option, warrant,
convertible security or other instrument or agreement.

          “Company” shall mean New Horizons Worldwide, Inc., a Delaware corporation, or any successor
thereto.

          “Governmental Entity” means a court, arbitral tribunal, administrative agency or commission or
other governmental or other regulatory authority or agency.

          “Law” means any law, statute, ordinance, rule, regulation, order, writ, judgment, injunction
or decree of any Governmental Entity.

          “New Securities” has the meaning set forth in Section 4.

          “Registration Rights Agreement” shall mean that certain Amended and Restated Registration
Rights Agreement of even date herewith among the Company, Camden and Alkhaleej.

 

 

          “Series B Preferred Directors” has the meaning set forth in Section 2.

          “Series B Preferred Stockholders” has the meaning set forth in the Recitals.

          “Sale Notice” has the meaning set forth in Section 4.

          “Series B Convertible Preferred Stock” shall mean the Series B Convertible Preferred Stock, no
par value, of the Company.

          “Stockholder Group” has the meaning set forth in Section 4.

          “Transfer” means the sale, gift, mortgage, pledge, exchange, assignment or other disposition
or transfer, including a disposition under judicial order, legal process, execution, attachment or
enforcement of an encumbrance, but shall not include: (a) a transfer by any Series B Preferred
Stockholder that is a party to this Agreement to any other Series B Preferred Stockholder that is a
party to this Agreement; (b) a transfer by a Series B Preferred Stockholder to such Series B
Preferred Stockholder’s spouse, children or grandchildren, or to trustees or custodians for their
benefit; or (c) a transfer by a Series B Preferred Stockholder to any limited or general partner or
Affiliate of the Series B Preferred Stockholder.

 

 

EXHIBIT B

Series B Preferred Stockholders

Camden Partners Strategic Fund III, L.P.

500 East Pratt Street

Suite 1200

Baltimore, MD 21202

Phone: (410) 878-6810

Fax: (410) 878-6850

Camden Partners Strategic Fund III-A, L.P.

500 East Pratt Street

Suite 1200

Baltimore, MD 21202

Phone: (410) 878-6810

Fax: (410) 878-6850

 

 

EXHIBIT C

Warrant Holders

Camden Partners Strategic Fund III, L.P.

500 East Pratt Street

Suite 1200

Baltimore, MD 21202

Phone: (410) 878-6810

Fax: (410) 878-6850

Camden Partners Strategic Fund III-A, L.P.

500 East Pratt Street

Suite 1200

Baltimore, MD 21202

Phone: (410) 878-6810

Fax: (410) 878-6850

Alkhaleej Training and Education Corporation

P.O. Box 295300

Riyadh 11351

Kingdom of Saudi Arabia

Attn: Alwaleed Aldryann

Fax: 9661-4656030

George S. Rich

904 S Broadway

Baltimore , Maryland 21231

Attn: George S. Rich

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