Document:

EX-10.3

 

Exhibit 10.3

AMENDMENT NO. 1 TO CREDIT AGREEMENT

          THIS
AMENDMENT NO. 1 TO CREDIT AGREEMENT is dated as of the 3rd day of
July,
2007, by and between NEW HORIZONS WORLDWIDE, INC., a Delaware corporation (“Borrower”),
each lender whose name is set forth on the signature pages of this Agreement (each a
“Lender” and collectively, “Lenders”), and CAMDEN PARTNERS STRATEGIC III, LLC, as
Administrative Agent (the “Administrative Agent”).

RECITALS

          Reference is made to that certain Credit Agreement dated July 19, 2006, among Borrower, the
Lenders and the Administrative Agent (the “Credit Agreement”), pursuant to which the Lenders have
made Advances to Borrower in the aggregate principal amount of Four Million Dollars ($4,000,000).
In order to amend the Credit Agreement to provide, inter alia, for certain adjustments to be made
in connection with the issuance of the Series C Stock (as hereinafter defined), the parties hereto
have entered into this Amendment No. 1.

          NOW, THEREFORE, in consideration of the premises and the mutual covenants set forth herein,
and such other consideration, the receipt and sufficiency of which are hereby acknowledged, the
parties hereto hereby agree as follows:

          1. All capitalized terms not otherwise defined herein which are defined in the Credit
Agreement shall have the same meanings assigned to them in the Credit Agreement.

          2. All references herein, in the Credit Agreement and in the other Loan Documents to “this
Agreement” and “the Credit Agreement” shall mean and include the Credit Agreement as amended by
this Amendment No. 1.

          3. Section 1.1 of the Credit Agreement is hereby amended by amending the definition of
“Adjusted EBITDA” to read in its entirety as follows:

     “Adjusted EBITDA” means, with respect to any fiscal period, the sum
of, without duplication, (a) EBITDA for such fiscal period, plus (b) to the
extent deducted in determining Net Income for such fiscal period, non-cash charges
of Borrower and

 

 

its Subsidiaries during such fiscal period relating to Borrower’s and its
Subsidiaries’ compliance with Financial Accounting Standards Board Statement No.
142, plus (c) to the extent deducted in determining Net Income for such
fiscal period, (i) non-cash charges recorded against earnings in Borrower’s and its
Subsidiaries’ financial statements for such fiscal period with respect to the
write-down of leasehold estates as a result of the sublease of such leasehold
estates, and (ii) the amount of litigation settlements approved by the Board of
Directors of Borrower, plus (d) non-cash charges associated with stock
options.

          4. Section 1.1 of the Credit Agreement is hereby amended by amending the definition of “Change
of Control” to revise and restate the sentence at the conclusion thereof to read in its entirety as
follows:

Notwithstanding the foregoing, no Change of Control shall be deemed to have
occurred as a result of the consummation of the transactions which are the subject
of the Preferred Stock Exchange Agreement, the Series C Stock Purchase Agreement or
the issuance or exercise of the Warrants.

          5. Section 1.1 of the Credit Agreement is hereby amended by amending the definition of
“Maturity Date” to read in its entirety as follows:

     “Maturity Date” means July 19, 2009.

          6. Section 1.1 of the Credit Agreement is hereby amended by amending the definition of
“Series A Warrants” to read in its entirety as follows:

     “Series A Warrants” means, collectively, the Series A-1 Warrants and
the Series A-2 Warrants.

          7. Section 1.1 of the Credit Agreement is hereby amended by amending the definition of
“Series B Warrants” to read in its entirety as follows:

     “Series B Warrants” means, collectively, the Series B-1 Warrants and
the Series B-2 Warrants.

          8. Section 1.1 of the Credit Agreement is hereby amended by amending the definition of
“Warrants” to read in its entirety as follows:

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     “Warrants” means, collectively, the Series A Warrants, the Series B Warrants and the
Series C Warrants.

          9. Section 1.1 of the Credit Agreement is hereby amended by adding the following new defined
terms in the alphabetically correct sequence:

     “Amendment No. 1” means that certain Amendment No. 1 to Credit
Agreement dated as of July 3, 2007, among Borrower, the Lenders and
the Administrative Agent.

     “Charter Amendment” means the amendment of Borrower’s Certificate of
Incorporation to be authorized pursuant to the Shareholder Approval.

     “Edusoft Contract” means the License Agreement dated September 23,
2004, as amended, between Borrower and Edusoft Ltd. relating to Borrower’s English
Language Program.

     “Series A-1 Warrants” means warrants to purchase in the aggregate
2,000,000 shares of Borrower’s common stock, each of which shall be in the form of
Exhibit E-3 attached hereto and incorporated herein.

     “Series A-2 Warrants” means warrants to purchase in the aggregate
984,335 shares of Borrower’s common stock, each of which shall be in the form of
Exhibit E-4 attached hereto and incorporated herein.

     “Series B-1 Warrants” means warrants to purchase in the aggregate
666,667 shares of Borrower’s common stock, each of which shall be in the form of
Exhibit E-5 attached hereto and incorporated herein.

     “Series B-2 Warrants” means warrants to purchase in the aggregate
150,818 shares of Borrower’s common stock, each of which shall be in the form of
Exhibit E-6 attached hereto and incorporated herein.

     “Series C Certificate of Designation” means the Certificate of
Designation, Preferences and Rights of Series C Convertible Preferred Stock of New
Horizons Worldwide, Inc. dated July 2, 2007, as the same may
from time to time be amended, restated, extended or otherwise modified.

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     “Series C Investor” and “Series C Investors” mean,
respectively, each “Investor” as defined in the Series C Stock Purchase Agreement
and all such Investors.

     “Series C Stock” means 172,043 shares of Borrower’s Series C
Convertible Preferred Stock which are convertible into 5,333,333 shares of the
Company’s common stock and which are issued pursuant to the Series C Stock Purchase
Agreement, the terms of which are further described in the Series C Certificate of
Designation.

     “Series C Stock Purchase Agreement” means that certain Series C Stock
and Warrant Purchase Agreement dated as of July 3, 2007, by and between
Borrower and the Series C Investors.

     “Series C Warrants” means warrants to purchase in the aggregate
1,066,667 shares of Borrower’s common stock, each of which shall be in the form of
Exhibit E-7 attached hereto and incorporated herein.

     “Shareholder Approval” means the approval of the shareholders of
Borrower to amend Borrower’s Certificate of Incorporation to increase in the
authorized common shares of Borrower to 30,000,000.

     “Shareholder Meeting” means the meeting of the shareholders of
Borrower at which the Shareholder Approval will be sought.

          10. Article 4 of the Credit Agreement is hereby amended by adding the following new Section
4.23:

     4.23 Series C Documents.

     True, accurate and complete copies of the Series C Stock Purchase Agreement,
the Series C Certificate of Designation and the Series C Warrants have been
provided to the Administrative Agent and the Lenders.

          11. Section 5.8 of the Credit Agreement is hereby amended by adding the following sentence at
the conclusion thereof:

Notwithstanding the foregoing, the failure of Borrower to fully comply with its
Contractual Obligations under the Edusoft
Contract shall not represent a breach of this Section 5.8 for a

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period of nine
months following date of Amendment No. 1; provided, however, that if (a) at any
time during such nine-month period Borrower shall admit liability or settle any
dispute under the Edusoft Contract for an amount in excess of $500,000, or (b) at
any time following such nine-month period a good faith determination is made by the
Administrative Agent that the liability of Borrower under the Edusoft Contract
could reasonably be expected to exceed $500,000, at such time Borrower shall be in
breach of this Section 5.8.

          12. Section 6.5 of the Credit Agreement is hereby amended and restated to read in its entirety
as follows:

     6.5 Other Indebtedness.

     Create, incur, assume or permit to exist any Indebtedness resulting from
borrowings, loans or advances, whether secured or unsecured, matured or unmatured,
liquidated or unliquidated, joint or several, except (a) the Obligations, (b)
Indebtedness owed to Borrower or any of its Subsidiaries, subject to the
limitations on such Indebtedness set forth in Section 6.7(b), (c)
Indebtedness existing on the Closing Date and disclosed in Schedule 6.5,
and refinancings, renewals, extensions or amendments that do not increase the
amount thereof, (d) Indebtedness which arises from Earnout Payments provided such
Earnout Payments are treated as Subordinated Obligations, and (e) Indebtedness
secured by Permitted Purchase Money Liens and/or Indebtedness incurred with respect
to Capital Lease Obligations (as determined by GAAP) in an aggregate amount not to
exceed $1,000,000 at any time outstanding.

          13. Section 6.6 of the Credit Agreement is hereby amended and restated to read in its entirety
as follows:

     6.6 Guaranties.

     Guarantee or become liable in any way as surety, endorser (other than as
endorser of negotiable instruments for deposit or collection in the ordinary course
of business), accommodation endorser or otherwise for, nor pledge or hypothecate
any assets of Borrower or any of its Subsidiaries as security for, any liabilities
or obligations of any other Person, except (a) any of the foregoing existing on the
Closing Date and
disclosed on Schedule 6.6, (b) any of the foregoing in favor of the

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Administrative Agent (on behalf of the Lenders), (c) endorsements for collection or
deposit in the ordinary course of business, (d) under surety bonds for an amount
not in excess of $500,000, (e) Interest Rate Protection Agreements approved by the
Administrative Agent, and (f) contingent obligations with respect to the minimum
aggregate license fees to the extent of $15,000,000 as payable pursuant to Exhibit
C of the Content License and Distribution Agreement between New Horizons Computer
Learning Centers, Inc. and Element K LLC.

          14. Section 6.8 of the Credit Agreement is hereby amended and restated to read in its entirety
as follows:

     6.8 Distributions.

Declare or pay or make any Distribution, whether from capital, income or otherwise,
and whether in Cash or other Property; provided, however, that so long as no
Default or Event of Default shall have occurred and be continuing (without waiver
or cure), Borrower shall be permitted to make Distributions payable pursuant to
Section 3 of the Series B Certificate of Designation, Section 3 of
the Series C Certificate of Designation and Section 9 of the Series C
Certificate of Designation, in each case subject to legal limitations, if any.

          15. Section 6.18 of the Credit Agreement is hereby amended and restated to read in its
entirety as follows:

     6.18 Capital Expenditures.

     Make any investment in fixed assets in any Fiscal Year in excess of an
aggregate amount of $1,000,000; provided, however, that with the express approval
of Borrower’s Board of Directors (a) from the date of the Amendment No. 1 to
December 31, 2007 Borrower may make an investment in fixed assets in an amount not
to exceed $1,000,000, and (b) in any Fiscal Year after 2007, Borrower may make an
investment in fixed assets in an amount not to exceed $2,000,000; provided,
further, that the following shall be excluded for purposes of compliance with this
Section 6.18: expenditures which are made in connection with the
replacement or restoration of assets to the extent financed (to the extent such
financing is permitted hereunder) either (a) from insurance proceeds paid on
account of the loss of or damage to the assets being replaced or restored, or (b)
with proceeds
from the sale or other disposition of an asset which is replaced

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within 90 days
from such sale or other disposition with another asset performing the same or a
similar function.

          16. Section 6.19 of the Credit Agreement is hereby amended to read in its entirety as follows:

     6.19 Amendments.

Amend or modify any term or provision of (a) any indenture, agreement or instrument
evidencing or governing any Subordinated Obligation, (b) any material provision of
any Material Contract, if in any such case such amendment or modification in any
respect will or may adversely affect the interest of the Lenders in any material
respect, or (c) any provision of the Series B Certificate of Designation, the
Series C Stock Purchase Agreement, the Series C Certificate of Designation or the
Series C Warrants, if in any such case such amendment or modification in any
respect will or may adversely affect the interest of the Lenders (including in
their capacities as holders of the Series A Warrants and/or the Series B Warrants)
in any material respect.

          17. Section 6.22 of the Credit Agreement is hereby amended to read in its entirety as
follows: 

     6.22 Change of Fiscal Periods.

     Change its Fiscal Year or any other fiscal period with respect to which it
reports financial results hereunder or otherwise without the financial covenants
and reporting obligations of Borrower hereunder which would be affected thereby
having been amended in a manner acceptable to the Administrative Agent in its
reasonable business judgment.

          18. Section 7.1(a) of the Credit Agreement is hereby amended to read in its entirety as
follows:

     (a) Within thirty (30) days after the end of each calendar month commencing
with the calendar month ending June 30, 2006 (other than the calendar months ending
each Fiscal Quarter, for which the period shall be forty-five (45) days, and
excluding the Fiscal Quarter ending December 31, for which the period shall be
sixty (60) days), the consolidated balance sheet of Borrower and its Subsidiaries
as at the end of such
calendar month and the consolidated statements of income and operations for such
calendar month, and the portion of the

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Fiscal Year ended with such calendar month,
all in reasonable detail. Such financial statements shall be certified by the
president or chief financial officer of Borrower as fairly presenting the financial
condition and results of operations of Borrower and its Subsidiaries in accordance
with GAAP (other than footnote disclosures), consistently applied, as at such date
and for such periods, subject only to normal year-end accruals and audit
adjustments.

          19. Section 7.1(b) of the Credit Agreement is hereby amended to read in its entirety as
follows:

     (b) With respect to the Fiscal Year ending December 31, 2006, concurrently
with any filing by or on behalf of Borrower with the Securities and Exchange
Commission which contains Borrower’s financial statements for such Fiscal Year, but
in no event later than June 30, 2007, and within ninety (90) days after the end of
each Fiscal Year thereafter, the consolidated balance sheet of Borrower and its
Subsidiaries as at the end of such Fiscal Year and the consolidated statements of
income, operations, stockholders’ equity and cash flows, in each case of Borrower
and its Subsidiaries for such Fiscal Year, all in reasonable detail. Such financial
statements shall be prepared in accordance with GAAP, consistently applied, and
such consolidated financial statements shall be accompanied by a report of
independent public accountants of recognized standing selected by Borrower and
reasonably satisfactory to the Requisite Lenders, which report shall be prepared in
accordance with generally accepted auditing standards as at such date, and shall
not be subject to any qualifications or exceptions other than qualifications,
exceptions or disclaimers relating to internal controls.

          20. A new Section 5.14 is hereby added to the Loan Agreement to read in its entirety as
follows:

          5.14 Shareholder Approval.

     (a) Within thirty (30) days following the later to occur of (i) the sale of
the Series C Shares to the Series C Investors, and (ii) the filing with the United
States Securities and Exchange Commission (the “SEC”) of Borrower’s Form 10-Q for
the quarterly period ending March 31, 2007, file or cause to be
filed with the SEC preliminary proxy materials (the “Proxy

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Materials”) for the
purpose of holding the Shareholder Meeting; and

     (b) Diligently respond to all SEC comments to its Proxy Materials and take all
such other actions as may be required to cause the Shareholder Meeting to occur,
and the Charter Amendment to become effective, as soon as is practicable.

          21. Section 9.1(d) of the Credit Agreement is hereby amended to read in its entirety as
follows:

     (d) Borrower (i) is in breach of Section 5.8 as provided in the final
sentence thereof, or (ii) fails to comply (A) with Section 5.14,
Section 7.1(i) or Section 7.3 in the manner stated therein, (B)
with Section 7.1(a), Section 7.1(b), Section 7.1(c),
Section 7.1(d), Section 7.1(f) or Section 7.2 within ten
(10) Banking Days of the date specified for performance therein, or (C) with any
other reporting requirement set forth in Article 7 within five (5) Banking
Days of the date specified for performance therein; or

          22. Section 9.1 of the Loan Agreement is hereby amended by (a) replacing the “.” at the end of
clause (q) with “; or” and (b) adding the following new clause (r) thereto:

     (r) Any or all of the Series C Investors shall have elected to redeem any or
all of their Series C Stock as provided in Section 9 of the Series C Certificate of
Designation.

          23. Schedules 4.1, 4.7, 4.8, 4.10 and 4.12 to the Credit Agreement are hereby amended,
restated and replaced by Schedules 4.1, 4.7, 4.8, 4.10 and 4.12 attached hereto. The Credit
Agreement is further amended by the addition of Exhibit E-3 through Exhibit E-7
thereto in the forms attached hereto as Exhibit E-3 through Exhibit E-7,
respectively.

          24. All notices, requests, demands, directions and other communications to Borrower provided
for under the Credit Agreement or under any other Loan Document shall be mailed, telegraphed,
telecopied, dispatched by commercial courier or delivered to the Borrower at the address set forth
on the signature pages of this Amendment No. 1 or at any other address as may be designated by it
in a written notice sent to all other parties to such Loan Document in accordance with Section 11.6
of the Credit Agreement.

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          25. To induce the Administrative Agent and the Lenders to enter into this Amendment No. 1,
Borrower hereby represents and warrants to the Administrative Agent and the Lenders that (a) the
representations and warranties made by Borrower in Sections 3.2, 3.3 and 3.4 of the Series C Stock
Purchase Agreement are true and correct on the date hereof and are deemed made to the
Administrative Agent and to the Lenders on the date hereof, (b) except as specifically provided
herein, the representations and warranties of Borrower set forth in Article 4 of the Credit
Agreement (including all representations and warranties made in such Article after giving effect to
this Amendment No. 1, but excluding the representations and warranties made in Sections 4.5, 4.6
and 4.17 thereof), and the representations and warranties of Borrower set forth in each of the
other Loan Documents, are true and correct in all material respects with the same effect as if made
on the date hereof (unless stated to relate solely to an earlier date, in which case they were true
and correct as of such earlier date; provided, however, that notwithstanding any such statement
relating to an earlier date, the representations and warranties made in Section 4.4 of the Credit
Agreement shall be deemed to have been restated as of the date hereof), and (c) after giving effect
to the terms of this Amendment No. 1, the Series C Stock Purchase Agreement and that certain letter
dated June 15, 2007 from the Lenders to Borrower waiving certain enumerated Defaults as set forth
therein, Borrower and each of the other Obligors is in compliance with all the terms and conditions
of the Credit Agreement and the other Loan Documents, and no Default or Event of Default has
occurred and is continuing.

          26. This Amendment No. 1 shall become effective on the date upon which the following shall all
have occurred:

               (a) The Administrative Agent shall have received each of the following, in form and substance
satisfactory to the Administrative Agent and its legal counsel:

                    (i) at least one (1) duly executed counterpart of this Amendment No. 1, together with
arrangements satisfactory to the Administrative Agent for additional executed counterparts,
sufficient in number for distribution to the Lenders and Borrower;

                    (ii) at least one (1) executed counterpart of a Consent to this Amendment No.1 (the
“Consent”), duly executed by each of the Obligors (other than Borrower), together with
arrangements satisfactory to the Administrative Agent for additional executed counterparts,
sufficient in number for distribution to the Lenders and Borrower;

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                    (iii) a pro forma Capital Summary for Borrower, after giving effect to the transactions which
are the subject of this Amendment No. 1 and the Series C Stock Purchase Agreement; and

                    (iv) such other and further documents, certificates, opinions of counsel and other papers,
duly executed and delivered by the Obligors, as the Administrative Agent shall reasonably request;
and Borrower shall have paid all fees due to the Administrative Agent and the Lenders.

               (b) The Series C Stock shall have been purchased by the Series C Investors in accordance with
the provisions of the Series C Stock Purchase Agreement (or with such deviations from the
provisions thereof as shall have been approved in writing by the Administrative Agent).

               (c) Stuart Smith and David Goldfinger shall have resigned as members of Borrower’s Board of
Directors and two nominees selected by the Series C Investors shall have been elected as
replacement Directors.

               (d) The Stockholders’ Agreement shall have been amended and/or restated in a manner acceptable
to the Administrative Agent and the Lenders pursuant to which, among other things (i) the Series C
Investors shall be added as parties thereto, (ii) the size of the Board of Directors of Borrower
shall be fixed at nine (9) members, and (iii) each of the holders of the Series B Stock and the
Series C Investors shall agree to vote their shares for the election of Curtis Lee Smith, Jr.,
William Heller and Richard Osborne to the Board of Directors of Borrower for terms ending at
Borrower’s annual meeting in 2009.

               (e) The Amended and Restated Registration Rights Agreement dated July 19, 2006, among Borrower
and the Closing Date Lenders shall have been amended and/or amended and restated in a manner
acceptable to the Administrative Agent and the Lenders to, among other things, add the Series C
Investors as “Holders” thereunder.

               (f) A notice from the Company relating to the adjustment of the conversion features of the
Series B Stock in connection with the issuance of the Series C Stock and the Series C Warrants.

          27. Borrower agrees to pay all out-of-pocket expenses incurred by the Administrative Agent in
connection with the review, preparation, negotiation, execution and delivery of this Amendment No.
1 and all other documents executed or to be executed in connection herewith, including, without
limitation, the expenses and reasonable fees of counsel to

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the Administrative Agent; provided, however, that Borrower shall not be required to pay any
such counsel fees in excess of $50,000.

          28. Except as amended hereby, the Credit Agreement shall remain unchanged, and the Credit
Agreement, as so amended, shall continue in full force and effect in accordance with its terms.

          29. This Amendment No. 1 may be executed in any number of counterparts and by the different
parties hereto on separate counterparts, each of which, when so executed and delivered, shall be an
original, but all such counterparts shall together constitute one and the same instrument.

          30. The recitals hereto and all of the terms of the Credit Agreement are hereby incorporated
into and made a part hereof as though fully set forth herein.

[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]

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          IN WITNESS WHEREOF, the parties have caused this Amendment No. 1 to Credit Agreement to be
duly executed under seal by their duly authorized respective officers as of the day and year first
above written.

	 	 	 	 	 	 	 
	 	 	NEW HORIZONS WORLDWIDE, INC.,

a Delaware corporation	 	 
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ Mark A. Miller	 	 
	 

	 	 	 	 	 	 
	 
	 	 	 	Mark A. Miller, President, CEO	 	 
	 	 	 	 	[Printed Name and Title]	 	 
	 
	 	 	 	 	 	 
	 	 	Address for notices:	 	 
	 
	 	 	 	 	 	 
	 	 	New Horizons Worldwide, Inc.

1900 S. State College Blvd. Suite

     650	 	 
	 	 	Anaheim, California 92806

Attn: Charles M. Caporale, Senior Vice

President and Chief Financial Officer	 	 
	 
	 	 	 	 	 	 
	 	 	Telecopier: (714) 940-8370

Telephone: (714) 940-8060	 	 
	 
	 	 	 	 	 	 
	 	 	With a copy to:	 	 
	 
	 	 	 	 	 	 
	 	 	Calfee, Halter & Griswold LLP

1400 KeyBank Center

800 Superior Avenue E.

Cleveland, Ohio 44114

Attn: Brian A. McMahon, Esq.	 	 
	 
	 	 	 	 	 	 
	 	 	Telecopier: (216) 241-0816

Telephone: (216) 622-8378	 	 

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	 	CAMDEN PARTNERS STRATEGIC III, LLC,

as Administrative Agent

 	 
	 	By:  	/s/ David L. Warnock	 
	 	 	David L. Warnock, Managing 	 
	 	 	Member 	 
	 

	 	 	 	 	 
	  	CAMDEN PARTNERS STRATEGIC FUND III, L.P., as
a Lender

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.,
as a Lender

By: CAMDEN PARTNERS STRATEGIC III, LLC, its
General Partner
	 
	 	 	 
	 	By:  	/s/ David L. Warnock	 
	 	 	David L. Warnock, Managing 	 
	 	 	Member 	 

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	 	ALKHALEEJ TRAINING AND EDUCATION CORPORATION,
as a Lender

 	 
	 	By:  	/s/
Awaleed Aldryaan	 
	 	  	Awaleed
Aldryaan, President	 
	 	 	[Printed Name and Title] 	 
	 	 	 	 

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	 	GEORGE S. RICH, as a Lender
 	 
	 	 	 
	 	/s/ George S. Rich	 
	 	George S. Rich 	 
	 	 	 
	 

-16-EX-10.4

 

Exhibit 10.4

THESE SECURITIES HAVE BEEN ISSUED PURSUANT TO EXEMPTIONS FOR NONPUBLIC OFFERINGS FROM THE
REGISTRATION REQUIREMENTS OF THE SECURITIES ACT OF 1933, AS AMENDED, AND APPLICABLE STATE
SECURITIES LAWS, AND, ACCORDINGLY, THESE SECURITIES MAY NOT BE RESOLD OR OTHERWISE DISPOSED OF
UNLESS, IN THE OPINION OF COUNSEL FOR THE HOLDER, REGISTRATION UNDER THE APPLICABLE FEDERAL OR
STATE SECURITIES LAWS IS NOT REQUIRED OR COMPLIANCE IS MADE WITH SUCH REGISTRATION REQUIREMENTS.

Void after 5:00 p.m. Eastern Time, on July 19, 2011

AMENDED AND RESTATED

WARRANT TO PURCHASE [                                      ] SHARES OF COMMON STOCK

OF

NEW HORIZONS WORLDWIDE, INC.

(Series A-1)

     This is to certify that, FOR VALUE RECEIVED, [                                                       
                        ] or its registered assigns pursuant to Section
(d) hereof (“Holder”), is entitled to purchase, subject to the provisions of this Warrant, from New
Horizons Worldwide, Inc., a Delaware corporation (the “Company”), [                                                            ]
(                            ) fully paid, validly
issued and nonassessable shares of Common Stock, par value $0.01 per share, of the Company (the
“Common Stock”), at the exercise price of $0.90 per share until July 19, 2011. The number of
shares of Common Stock to be received upon the exercise of this Warrant and the price to be paid
for each share of Common Stock may be adjusted from time to time as hereinafter set forth. The
shares of Common Stock deliverable upon such exercise, and as adjusted from time to time, are
hereinafter sometimes referred to as “Warrant Shares,” and the exercise price of a share of Common
Stock as adjusted from time to time is hereinafter sometimes referred to as the “Exercise Price.”

     (a) EXERCISE OF WARRANT; NOTIFICATION OF EXPIRATION DATE OF WARRANT. The Warrant may be
exercised as to Warrant Shares at any time or from time to time, from and after [                   ], 2007 until
5:00 P.M. Eastern time on July 19, 2011 (the “Expiration Date”), provided, however, that if such
day is a day on which banking institutions in the State of Delaware are authorized by law to close,
then on the next succeeding day which shall not be such a day. The Warrant may be exercised by
presentation and surrender hereof to the Company at its principal office, or at the office of its
stock transfer agent, if any, with the Purchase Form annexed hereto duly executed (with signature
guaranteed if required by the Company or its stock transfer agent) and accompanied by payment of
the Exercise Price for the number of Warrant Shares specified in such form and any applicable
taxes. The purchase price

1

 

for any Warrant Shares purchased pursuant to the exercise of this Warrant shall be paid in full
upon such exercise in cash or by certified or bank check or pursuant to a cashless exercise
procedure in accordance with Section (k) hereof. As soon as practicable after each such exercise
of the Warrants, but not later than seven (7) business days from the date of such exercise, the
Company shall issue and deliver to the Holder a certificate or certificates for the Warrant Shares
issuable upon such exercise, registered in the name of the Holder or the Holder’s designee. If the
Warrant should be exercised in part only, the Company shall, upon surrender of the Warrant for
cancellation, execute and deliver a new Warrant evidencing the rights of the Holder thereof to
purchase the balance of the Warrant Shares purchasable thereunder. In the event of a cash
exercise, upon receipt by the Company of the Warrant at its office, or by the stock transfer agent
of the Company at its office, in proper form for exercise, together with the exercise price thereof
and taxes as aforesaid in cash or certified or bank check and the opinion described below, the
Holder shall be deemed to be the holder of record of the shares of Common Stock issuable upon such
exercise, notwithstanding that the stock transfer books of the Company shall then be closed or that
certificates representing such shares of Common Stock shall not then be physically delivered to the
Holder. It is further understood that certificates for the Warrant Shares, if any, to be issued
upon exercise of the Warrant may contain a restrictive legend in accordance with Section (i)
hereof.

     (b) RESERVATION OF SHARES. The Company shall at all times reserve for issuance and/or
delivery upon exercise of this Warrant such number of shares of its Common Stock as shall be
required for issuance and delivery upon exercise of the Warrants.

     (c) FRACTIONAL SHARES. No fractional shares or scrip representing fractional shares shall be
issued upon the exercise of the Warrant. With respect to any fraction of a share called for upon
any exercise hereof, the Company shall pay to the Holder an amount in cash equal to such fraction
multiplied by the current market value of a share, determined as follows:

(1) If the Common Stock is listed on a national securities exchange or admitted to
unlisted trading privileges on such exchange or listed for trading on the Nasdaq
National Market System, the current market value shall be the last reported sale
price of the Common Stock on such exchange or system on the last business day prior
to the date of exercise of this Warrant or if no such sale is made on such day, the
average bid and asked prices for such day on such exchange or system;

(2) If the Common Stock is not so listed or admitted to unlisted trading privileges,
the current market value shall be the mean of the last reported bid and asked prices
reported by the National Quotation Bureau, Inc. on the last business day prior to
the date of the exercise of this Warrant; or

(3) If the Common Stock is not so listed or admitted to unlisted trading privileges
and bid and asked prices are not so reported, the current market value shall be an
amount, not less than the book value thereof as at the end of the most recent fiscal
year of the Company ending prior to the date of the exercise of the

2

 

Warrant, determined in such reasonable manner as may be prescribed by the Board of
Directors of the Company.

     (d) EXCHANGE, TRANSFER, ASSIGNMENT OR LOSS OF WARRANT. The Warrant is exchangeable, without
expense, at the option of the Holder, upon presentation and surrender hereof to the Company or at
the office of its stock transfer agent, if any, for other Warrants of different denominations
entitling the Holder thereof to purchase in the aggregate the same number of shares of Common Stock
purchasable hereunder. Subject to Section (i) hereof, the Holder will not sell, assign or transfer
this Warrant in whole or in part unless this Warrant shall have been registered for sale under the
Securities Act or until the Company shall have received from counsel for the Holder an opinion to
the effect that the proposed sale or other transfer of this Warrant by the Holder may be effected
without such registration. Upon surrender of this Warrant to the Company at its principal office
or at the office of its stock transfer agent, if any, with the Assignment Form annexed hereto duly
executed (with signature guaranteed, if required by the Company or its stock transfer agent) and
funds sufficient to pay any transfer tax, the Company shall, without charge, execute and deliver a
new Warrant in the name of the assignee or assignees named in such instrument of assignment and
this Warrant shall promptly be canceled. This Warrant may be divided by or combined with other
Warrants which carry the same rights upon presentation hereof at the principal office of the
Company or at the office of its stock transfer agent, if any, together with a written notice
specifying the names and denominations in which new Warrants are to be issued and signed by the
Holder hereof. The term “Warrant” as used herein includes any Warrants into which this Warrant may
be divided or exchanged. Upon receipt by the Company of evidence satisfactory to it of the loss,
theft, destruction or mutilation of this Warrant, and in the case of loss, theft or destruction, of
reasonable satisfactory indemnification, and upon surrender and cancellation of this Warrant, if
mutilated, the Company will execute and deliver a new Warrant of like tenor, date and amount. Any
such new Warrant executed and delivered shall constitute an additional contractual obligation on
the part of the Company, whether or not the original Warrant shall be at any time enforceable
(subject to the Company’s right of indemnification as provided above) by anyone.

     (e) RIGHTS OF THE HOLDER. The Holder shall not, by virtue hereof, be entitled to any rights
of a shareholder in the Company, either at law or equity, and the rights of the Holder are limited
to those expressed in the Warrant and are not enforceable against the Company except to the extent
set forth herein.

     (f) CERTAIN ADJUSTMENTS. So long as this Warrant shall be outstanding, the Exercise Price in
effect at any time and the number and kind of securities purchasable upon the exercise of the
Warrants shall be subject to adjustment from time to time upon the happening of certain events as
follows:

(1) Reclassification, Consolidation or Merger. In case of any
reclassification or change of outstanding securities of the class issuable upon
exercise of this Warrant (other than a change in par value, or from par value to no
par value, or as a result of a subdivision or combination), or in case of any
consolidation or merger of the Company with or into another corporation (other than
a merger (i) with another corporation in which the Company is the surviving
corporation and

3

 

which does not result in any reclassification or change of outstanding securities
issuable upon exercise of this Warrant or (ii) a merger in which the Company is not
the surviving corporation and holders of equity securities of the Company as a
result of such merger receive more than 50% of the equity securities of the
surviving corporation), or in case of any sale of all or substantially all of the
assets of the Company, or in case of a share exchange in which 50% or more of the
outstanding capital stock of the Company is exchanged for capital stock of another
corporation, any of which transactions shall be referred to hereinafter as a
“Corporate Transaction”, the Company or such successor or purchasing company or
entity, as the case may be, shall execute with the Holder of this Warrant an
agreement pursuant to which the Holder of the Warrant shall have the right
thereafter to purchase upon exercise of the Warrant the kind and amount of shares,
and/or other securities and property that the Holder of the Warrant would have owned
or have been entitled to receive after the happening of such Corporate Transaction
had the Warrant been exercised immediately prior to such action. The agreement
referred to in this subsection (1) shall provide for adjustments which shall be as
nearly equivalent as may be practicable to the adjustments provided for in this
Section (f). The provisions of this subsection (1) shall similarly apply to
successive Corporate Transactions.

(2) Subdivision or Combination of Shares. If the Company at any time while
this Warrant remains outstanding and unexpired shall subdivide or combine its Common
Stock, the Exercise Price shall be proportionately decreased in the case of a
subdivision or increased in the case of a combination.

(3) Stock Dividends. If the Company at any time while this Warrant is
outstanding and unexpired shall pay a dividend with respect to Common Stock payable
in, or make any other distribution with respect to Common Stock (except any
distribution provided for in the foregoing subsection (1) or (2)), of Common Stock,
then the Exercise Price shall be adjusted, from and after the date of determination
of shareholders entitled to receive such dividend or distribution, to that price
determined by multiplying the Exercise Price in effect immediately prior to such
date of determination by a fraction (a) the numerator of which shall be the total
number of shares of Common Stock outstanding immediately prior to such dividend or
distribution and (b) the denominator of which shall be the total number of shares of
Common Stock outstanding immediately after such dividend or distribution.

(4) Adjustment of Exercise Price for Diluting Issues.

(A) If at each or any time prior to July 19, 2007 the Company shall issue or
sell, or is, in accordance with subsections (5)(A) or (5)(B) hereof, deemed
to have issued or sold, any shares of Common Stock for a consideration per
share less than the applicable Exercise Price immediately prior to the time
of such issue or sale (each a “Dilutive Issuance”), then, forthwith upon
such issue or sale, such Exercise Price

4

 

shall be reduced to the price at which the Company issued or sold, or is
deemed to have issued or sold, such shares of Common Stock.

(B) If at each or any time on or after July 19, 2007 there is a Dilutive
Issuance, then, and in each such case, the Exercise Price theretofore in
effect shall be reduced, concurrently with such issue or sale, to a price
equal to the quotient obtained by dividing:

     (1) an amount equal to (x) the total number of shares of Common Stock
outstanding immediately prior to such issuance or sale multiplied by the
Exercise Price in effect immediately prior to such issuance or sale, plus
(y) the consideration, if any, received or deemed to be received by the
Company upon such issuance or sale as set forth below; by

     (2) the total number of shares of Common Stock outstanding immediately
after such issuance or sale.

For purposes of the foregoing formula, all shares of Common Stock issuable
upon the exercise of outstanding Options (as defined below) or issuable upon
the conversion of Convertible Securities (as defined below) shall be deemed
outstanding shares of Common Stock.

(5) For purposes of this Section (f), the following subparagraphs (A) to (G)
shall also be applicable:

          (A) Issuance of Rights or Options. In case at any time the
Company shall in any manner grant (whether directly or by assumption in a
merger or otherwise) any warrants or other rights to subscribe for or to
purchase, or any options for the purchase of, Common Stock or any stock or
security convertible into or exchangeable for Common Stock (such warrants,
rights or options being called “Options” and such convertible or
exchangeable stock or securities being called “Convertible Securities”)
whether or not such Options or the right to convert or exchange any such
Convertible Securities are immediately exercisable, and the price per share
for which Common Stock is issuable upon the exercise of such Options or upon
the conversion or exchange of such Convertible Securities (determined by
dividing (a) the total amount, if any, received or receivable by the Company
as consideration for the granting of such Options, plus the minimum
aggregate amount of additional consideration payable to the Company upon the
exercise of all such Options, plus, in the case of such Options which relate
to Convertible Securities, the minimum aggregate amount of additional
consideration, if any, payable upon the issue or sale of such Convertible
Securities and upon the conversion or exchange thereof, by (b) the total
maximum number of shares of Common Stock issuable upon the exercise of all
such Options or upon the conversion or exchange of all such Convertible

5

 

Securities issuable upon the exercise of such Options) shall be less
than the applicable Exercise Price immediately prior to the time of the
granting of such Options or Convertible Securities, then the total maximum
number of shares of Common Stock issuable upon the exercise of such Options
or upon conversion or exchange of the total maximum amount of such
Convertible Securities issuable upon the exercise of such Options shall be
deemed to have been issued for such price per share as of the date of
granting of such Options or the issuance of such Convertible Securities and
thereafter shall be deemed to be outstanding. Except as otherwise provided
in subparagraph (C), no adjustment of any Exercise Price shall be made upon
the actual issue of such Common Stock or of such Convertible Securities upon
exercise of such Options or upon the actual issue of such Common Stock upon
conversion or exchange of such Convertible Securities.

          (B) Issuance of Convertible Securities. In case the Company
shall in any manner issue (whether directly or by assumption in a merger or
otherwise) or sell any Convertible Securities, whether or not the rights to
exchange or convert any such Convertible Securities are immediately
exercisable, and the price per share for which Common Stock is issuable upon
such conversion or exchange (determined by dividing (a) the total amount
received or receivable by the Company as consideration for the issue or sale
of such Convertible Securities, plus the minimum aggregate amount of
additional consideration, if any, payable to the Company upon the conversion
or exchange thereof, by (b) the total maximum number of shares of Common
Stock issuable upon the conversion or exchange of all such Convertible
Securities) shall be less than the applicable Exercise Price immediately
prior to the time of such issue of sale, then the total maximum number of
shares of Common Stock issuable upon conversion or exchange of all such
Convertible Securities shall be deemed to have been issued for such price
per share as of the date of the issue or sale of such Convertible Securities
and thereafter shall be deemed to be outstanding, provided that (a) except
as otherwise provided in subparagraph (C), no adjustment of any Exercise
Price shall be made upon the actual issue of such Common Stock upon
conversion or exchange of such Convertible Securities and (b) if any such
issue or sale of such Convertible Securities is made upon exercise of any
Options to purchase any such Convertible Securities for which adjustments of
any Exercise Price have been or are to be made pursuant to other provisions
of this Section (f), no further adjustment of such Exercise Price shall be
made by reason of such issue or sale.

          (C) Change in Option Price or Conversion Rate. Upon the
happening of any of the following events, namely, if the purchase price
provided for in any Option referred to in subparagraph (A), the additional
consideration, if any, payable upon the conversion or exchange of any
Convertible Securities referred to in subparagraph (A) or (B), or the rate
at

6

 

which Convertible Securities referred to in subparagraph (A) or (B) are
convertible into or exchangeable for Common Stock shall change at any time
(including, but not limited to, changes under or by reason of provisions
designed to protect against dilution), the applicable Exercise Price at the
time of such event shall forthwith be readjusted to the Exercise Price which
would have been in effect at such time had such Options or Convertible
Securities still outstanding provided for such changed purchased price,
additional consideration or conversion rate, as the case may be, at the time
initially granted, issued or sold, but only if as a result of such
adjustment the Exercise Price then in effect hereunder is thereby reduced;
and on the expiration or termination of such Convertible Securities, the
Exercise Price then in effect hereunder shall forthwith be increased to the
Exercise Price which would have been in effect at the time of such
expiration or termination had such Option or Convertible Securities, to the
extent outstanding immediately prior to such expiration or termination,
never been issued.

          (D) Stock Dividends. In case the Company shall declare a
dividend or make any other distribution upon any stock of the Company
payable in Common Stock (except for dividends or distributions upon the
Common Stock), Options or Convertible Securities, any Common Stock, Options
or Convertible Securities, as the case may be, issuable in payment of such
dividend or distribution shall be deemed to have been issued or sold at a
consideration equal to $.01 per share.

          (E) Consideration for Stock. In case any shares of Common
Stock, Options or Convertible Securities shall be issued or sold for cash,
the consideration received therefor shall be deemed to be the amount
received by the Company therefor, without deduction therefrom of any
expenses incurred or any underwriting commissions or concessions paid or
allowed by the Company in connection therewith. In case any shares of
Common Stock, Options or Convertible Securities shall be issued or sold for
a consideration other than cash, the amount of the consideration other than
cash received by the Company shall be deemed to be the fair value of such
consideration as determined in good faith by the Board of Directors of the
Company, without deduction of any expenses incurred or any underwriting
commissions or concessions paid or allowed by the Company in connection
therewith. In case any Options shall be issued in connection with the issue
and sale of other securities of the Company, together comprising one
integral transaction in which no specific consideration is allocated to such
Options by the parties thereto, such Options shall be deemed to have been
issued for such consideration as determined in good faith by the Board of
Directors of the Company.

          (F) Record Date. In case the Company shall take a record of
the holders of its Common Stock for the purpose of entitling them (a) to
receive a dividend or other distribution payable in Common

7

 

Stock, Options or Convertible Securities or (b) to subscribe for or
purchase Common Stock Options or Convertible Securities, then such record
date shall be deemed to be the date of the issue or sale of the shares of
Common Stock deemed to have been issued or sold upon the declaration of such
dividend or the making of such other distribution or the date of the
granting of such right of subscription or purchase, as the case may be.

          (G) Treasury Shares. The disposition of any shares of Common
Stock owned or held by or for the account of the Company shall be considered
an issue or sale of Common Stock for the purpose of this Section (f).

     (6) No Adjustment in Certain Circumstances. No adjustment of
the Exercise Price shall be made pursuant to this Section (f) pursuant to
(A) shares of Common Stock, Options or Convertible Securities, issued to
officers, directors and employees of, and consultants to, the Company 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; (B) shares of Common Stock
issuable upon exercise of Options, Convertible Securities or other rights to
acquire securities of the Company issued on or outstanding on July 19, 2006,
and (C) shares of Common Stock issuable upon (i) the conversion of the
“Series B Stock” or the “Series C Stock” or (ii) the exercise of any of the
“Warrants” as such terms are defined in that certain Credit Agreement dated
July 19, 2006, among the Company, Camden Partners Strategic III, LLC, as
Administrative Agent, and the “Lenders” as therein defined, as amended (the
“Credit Agreement”).

     (7) Adjustment of Number of Warrant Shares. Upon each
adjustment in the Exercise Price, the number of Warrant Shares purchasable
hereunder shall be adjusted, to the nearest whole share, to the product
obtained by multiplying the number of Warrant Shares purchasable immediately
prior to such adjustment in the Exercise Price by a fraction, the numerator
of which shall be the Exercise Price immediately prior to such adjustment
and the denominator of which shall be the Exercise Price immediately
thereafter.

     (8) Calculations. All calculations under this Section (f)
shall be made to the nearest cent or to the nearest Warrant Share, as the
case may be. No adjustment in the Exercise Price shall be required unless
such adjustment would require an increase or decrease of at least $.01 in
such price; provided, however, that any adjustments which by reason of this
subparagraph (8) are not required to be made shall be carried forward and
taken into account in any subsequent adjustment required to be made
hereunder.

8

 

     (9) Computations by Chief Financial Officer. Each computation
required by this Section (f) for purposes of determining whether the
Exercise Price shall be adjusted shall be performed by the Company’s Chief
Financial Officer on the basis of the Company’s internally prepared
unaudited financial statements. Such unaudited financial statements shall
be accompanied by a certificate signed by the President and Chief Financial
Officer certifying that such unaudited statements have been prepared in
accordance with GAAP on a basis consistently applied and included all
adjustments (consisting only of normal, recurring accruals) necessary for a
fair presentation of the financial position and results of the Company as of
the end of each such period. Any dispute between a holder and the Company
in regard to such a computation shall be referred to and decided by the
Company’s then engaged firm of independent certified public accountants,
which shall be a firm of recognized national reputation (the “Accounting
Firm”). The computations of the Accounting Firm shall be final and binding
on the Company and the Holder.

     (10) Adjustment of Shares Received Pursuant to this Section.
In the event that at any time, as a result of an adjustment made pursuant to
this Section (f) above, the Holder of this Warrant thereafter shall become
entitled to receive any shares of the Company, other than Common Stock,
thereafter the number of such other shares so receivable upon exercise of
this Warrant shall be subject to adjustment from time to time in a manner
and on terms as nearly equivalent as practicable to the provisions with
respect to the Common Stock contained in subsection (1) above.

     (11) Warrants Issued Hereafter. Irrespective of any
adjustments in the Exercise Price or the number or kind of Warrant Shares
purchasable upon exercise of this Warrant, Warrants theretofore or
thereafter issued may continue to express the same price and number and kind
of shares as are stated in the similar Warrants initially issuable pursuant
to this Warrant.

     (g) OFFICER’S CERTIFICATE. Whenever the Exercise Price shall be adjusted as required by the
provisions of the foregoing Section, the Company shall forthwith file in the custody of its
Secretary or an Assistant Secretary at its principal office and with its stock transfer agent, if
any, an officer’s certificate showing the adjusted Exercise Price determined as herein provided,
setting forth in reasonable detail the facts requiring such adjustment, including a statement of
the number of additional shares of Common Stock, if any, and such other facts as shall be necessary
to show the reason for and the manner of computing such adjustment. Each such officer’s
certificate shall be made available at all reasonable times for inspection by the Holder or any
holder of a Warrant executed and/or delivered pursuant to Section (a) or Section (d), and the
Company shall, forthwith after each such adjustment, mail, by certified mail, a copy of such
certificate to the Holder or any such holder.

9

 

     (h) NOTICES TO WARRANT HOLDERS. So long as this Warrant shall be outstanding, (i) if the
Company shall pay any dividend or make any distribution upon the Common Stock, or (ii) if the
Company shall offer to the holders of Common Stock for subscription or purchase by them any shares
of any class or any other rights, or (iii) if any capital reorganization of the Company,
reclassification of the capital stock of the Company, consolidation or merger of the Company with
or into another corporation, sale, lease or transfer of all or substantially all of the property
and assets of the Company to another corporation, or voluntary or involuntary dissolution,
liquidation or winding up of the Company shall be effected, then in any such case, the Company
shall cause to be mailed by certified mail to the Holder or any holder of a Warrant executed and/or
delivered pursuant to Section (a) or Section (d), at least 20 days prior to the date specified in
(x) or (y) below, as the case may be, a notice containing a brief description of the proposed
action and stating the date on which (x) a record is to be taken for the purpose of such dividend,
distribution or rights, or (y) such reclassification, reorganization, consolidation, merger,
conveyance, lease, dissolution, liquidation or winding up is to take place and the date, if any is
to be fixed, as of which the holders of Common Stock or other securities shall receive cash or
other property deliverable upon such reclassification, reorganization, consolidation, merger,
conveyance, dissolution, liquidation or winding up.

     (i) SECURITIES LAW COMPLIANCE

	 	(1)	 	The Holder of the Warrant, by acceptance hereof, acknowledges
that the Warrant and the shares of Common Stock to be issued upon exercise
hereof or conversion thereof are being acquired solely for the Holder’s own
account and not as a nominee for any other party, and for investment, and that
the Holder will not offer, sell, transfer, assign or otherwise dispose of this
Warrant or any shares of Common Stock to be issued upon exercise hereof or
conversion thereof except under circumstances that will not result in a
violation of the Act or any state securities laws. Upon exercise of the
Warrant, the Holder shall, if requested by the Company, confirm in writing, in
a form satisfactory to the Company, that the shares of Common Stock so
purchased are being acquired solely for the Holder’s own account and not as a
nominee for any other party, for investment, and not with a view toward
distribution or resale.
	 
	 	(2)	 	If appropriate, the Warrant and any Warrants issued upon
exercise or substitution or upon assignment or transfer pursuant to Section (a)
or Section (d), as the case may be, and all shares of Common Stock issued upon
exercise hereof or conversion thereof shall be stamped or imprinted with
legends setting forth the restrictions on transfer arising under applicable
federal and state securities laws.

     (j) REGISTRATION RIGHTS UNDER THE SECURITIES ACT OF 1933; STOCKHOLDERS’ AGREEMENT. The Holder
of this Warrant or of the Warrant Shares, upon execution thereof, shall be entitled to the
registration rights afforded under the Amended and Restated Registration Rights Agreement, dated as
of the date hereof, among the Company, the Holder and the other parties named therein. The voting
rights and obligations with respect to,

10

 

and the sale or other disposition of, the Warrant Shares shall be restricted by and subject to the
provisions of a Second Amended and Restated Stockholders’ Agreement dated as of [                               ], 2007
and the certificates or other evidence representing the Warrant Shares shall bear a 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 A SECOND AMENDED AND RESTATED STOCKHOLDERS’ AGREEMENT DATED AS OF
[                                 ], 2007, A COPY OF WHICH IS AVAILABLE FOR INSPECTION AT THE OFFICES OF
THE COMPANY.

     (k) CASHLESS EXERCISE. Notwithstanding any provisions to the contrary, if the fair market
value of one (1) share of Common Stock is greater than the Exercise Price (at the date of
calculation as set forth below), in lieu of exercising this Warrant for cash, the Holder may elect
to receive shares of Common Stock equal to the value (as determined below) of this Warrant (or the
portion thereof being canceled) by surrender of this Warrant at the principal office of the Company
together with the properly endorsed Notice of Exercise and notice of such election in which event
the Company shall issue to the Holder a number of shares of Common Stock computed using the
following formula:

	 	 	 
	 

	 	X=Y (A-B)
	 

	 	           A

	 	 	 	 	 	 	 
	 

	 	Where
	 	X =
	 	the number of shares of Common Stock to be issued to the Holder
	 

	 	 	 	Y =
	 	the number of shares of Common Stock purchasable under the Warrant or,
if only a portion of the Warrant is being exercised, the portion of
the Warrant being cancelled (at the date of such calculation)
	 
	 

	 	 	 	A =
	 	the fair market value of one share of Common Stock (at the date of
such calculation and calculated in accordance with Section (c) hereof)
	 
	 

	 	 	 	B =
	 	Exercise Price (as adjusted to the date of such calculation)

     (l) AMENDMENTS. This Warrant is given in replacement of, and amends and restates in its
entirety, that certain Warrant to Purchase [                                        ] Shares of Common Stock of New
Horizons Worldwide, Inc. (Series A) issued to the Holder dated July 19, 2006. This Warrant is one
of the “Series A Warrants” as defined in the Credit Agreement. Neither this Warrant nor any term
hereof may be changed, waived, discharged or terminated without the prior written consent of the
Holder. Notwithstanding anything in this Warrant to the contrary, in the event the Series C
Warrants (as defined in the Credit Agreement) are cancelled or terminated in their entirety as a
result of a redemption of the Series C Stock (as defined in the Credit Agreement) in accordance
with the provisions of Section 9 of the Series C Certificate of

11

 

Designation (as defined in the Credit Agreement), the Exercise Price shall be reset at $1.50 per
share as of the date of issuance hereof. Such Exercise Price shall be subject to all adjustments
provided for under the terms of this Warrant after the issuance hereof other than any adjustment
which would otherwise have occurred as a result of the cancellation or termination of the Series C
Warrants as provided above, it being understood that the only adjustment to be made with respect
thereto shall be to reset the Exercise Price as of the date of the issuance of this Warrant at
$1.50 per share.

     (m) NO IMPAIRMENT. The Company will not avoid or seek to avoid the observance or performance
of any of the terms to be observed or performed hereunder by the Company, but will at all times in
good faith assist in the carrying out of all the provisions of this Warrant and in the taking of
all such action as may be necessary or appropriate in order to protect the rights of any Holder.

     (n) GOVERNING LAW. This Warrant shall be governed by and construed under the laws of the
State of Delaware.

     (o) NOTICES. All notices and other communications required or permitted hereunder shall be in
writing and shall be mailed by first class mail, postage prepaid, addressed (a) if to the Holder, [                                      
                
                 ] or (b) if to the Company, to 1900 S. State College Blvd., Suite 650, Anaheim, CA 92806, or at
such other address as to the Company shall have furnished to the Holder in writing.

12

 

     IN WITNESS WHEREOF, New Horizons Worldwide, Inc. has caused this Warrant to be executed by its
officer thereunto duly authorized.

Dated:                                  , 2007

	 	 	 	 	 
	 	NEW HORIZONS WORLDWIDE, INC.

 	 
	 	By:  	 	 
	 	 	Name:  	 	 
	 	 	Title:  	 	 

 

 

PURCHASE FORM

	 	 	 
	 
	 	Dated                                         , 20__

     The undersigned hereby irrevocably elects to exercise its rights pursuant to this Warrant to
the extent of purchasing                      shares of Common Stock of New Horizons Worldwide, Inc. (the
“Company”), and hereby makes payment of $                    , in cash, in payment of the exercise price
thereof.

     The undersigned hereby irrevocably elects to exercise its rights pursuant to this Warrant to
the extent of purchasing                      shares of Common Stock and hereby authorizes you to deliver such
shares of Common Stock for sale to                     , and to retain from the proceeds of such sale
$                    , in cash, in payment of the exercise price thereof and to remit to the undersigned the
balance of such proceeds.

     Pursuant to Section (k), the undersigned hereby irrevocably elects to exercise its rights
pursuant to this Warrant to purchase                      shares of Common Stock through a cashless exercise
and hereby directs you to deliver shares of Common Stock to                     , in payment of the excess of
the fair market value over the exercise price thereof.

ASSIGNMENT FORM

     FOR VALUE RECEIVED, ____________________________________________________________
hereby sells, assigns and transfers unto

Name 

               (Please typewrite or print in block letters)

Address 

the right to purchase Common Stock of the Company, represented by this Warrant to the extent of
                     shares as to which such right is exercisable and does hereby irrevocably constitute and
appoint                                                           as Attorney, to transfer the same on the books of the Company
with full power of substitution in the premises.

Date                                         , 20__

Signature

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