Exhibit 10.60
SUBORDINATION AGREEMENT
THIS SUBORDINATION AGREEMENT (the "Agreement") dated as of October 1, 2001,
is entered into by and between COMDISCO, INC., a Delaware corporation
("Subordinated Creditor"), and PRINCETON REVIEW PUBLISHING, L.L.C., a Delaware
limited liability company ("Borrower"), for the express benefit of Senior
Creditor (as defined in Section 1 below).
RECITALS
A. Concurrently herewith, Borrower has requested Subordinated Creditor to
make available to Borrower a secured loan in an aggregate amount of Three
Million Four Hundred Thousand And No/100 Dollars ($3,400,000) ("Loan"), which
would be evidenced by a Subordinated Promissory Note executed by Borrower (as
the same may be amended, restated, supplemented or otherwise modified from time
to time, "Subordinated Note"), pursuant to a Subordinated Loan and Security
Agreement of even date herewith, by and between Borrower and Subordinated
Creditor (as the same may be amended, restated, supplemented or otherwise
modified from time to time, the "Subordinated Loan Agreement"). Borrower's
obligations to Subordinated Creditor evidenced by the Subordinated Note are
secured by the personal property collateral granted by Borrower to Subordinated
Creditor pursuant to the Subordinated Loan Agreement, and a lien in all of
personal property of The Princeton Review, Inc. ("TPR") and TPR's subsidiaries'
pursuant to that certain Security Agreement between TPR, TPR's subsidiaries and
Lender of even date herewith (the "Subordinated Security Agreement"), and
guaranteed by TPR and TPR's subsidiaries pursuant to that certain Secured
Guaranty of even date herewith (the "Subordinated Guaranty").
B. In contemplation of Borrower obtaining future senior secured financing
and the conditions expected to be imposed by Senior Creditors as conditions
precedent to making available to Borrower the proceeds of any such future
financing, Subordinated Creditor is entering into this Agreement with Borrower
for the express benefit of Senior Creditors, on the terms and subject to the
conditions set forth below.
AGREEMENT
NOW, THEREFORE, in consideration of Borrower's and Subordinated Creditor's
entering into the Subordinated Loan Documents (as defined in Section 1 below),
Subordinated Creditor and Borrower hereby severally agree, each on behalf of
itself and for the benefit of Senior Creditor, as set forth below.
1. DEFINITIONS
(a) As used herein, the following terms shall have the following meanings:
"Senior Creditor" means lender, or a single syndicate of such institutional
lenders that provides any senior secured Indebtedness to Borrower after the date
hereof; provided, that the Borrower maintains a maximum ratio of total
Indebtedness to the stockholders' equity as reflected in TPR's Consolidated
Balance Sheets as measured on the last day of each quarter,
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of not more than 1.25:1; provided further, that Senior Creditor shall not
include any officer, director, shareholder, venture capital investor, insider of
Borrower, or any affiliate of the foregoing persons, except upon the express
written consent of Subordinated Creditor.
"Senior Debt" means any and all indebtedness and obligations for borrowed
money (including principal, premium (if any), interest, fees, charges, expenses,
costs, professional fees and expenses, and reimbursement obligations) at any
time owing by Borrower to any Senior Creditor under the Senior Loan Documents,
including but not limited to such amounts as may accrue or be incurred before or
after default or workout or the commencement of any liquidation, dissolution,
bankruptcy, receivership or reorganization by or against Borrower provided, that
Senior Debt shall not include obligations incurred after default or workout or
the commencement of any liquidation, dissolution, bankruptcy, receivership, or
reorganization case by or against Borrower.
"Senior Loan Documents" means any senior loan agreement and any other
agreement, security agreement, document, promissory note, UCC financing
statement, or instrument executed by Borrower in favor of any Senior Creditor
pursuant to or in connection with Senior Debt, as the same may be amended,
restated, supplemented, modified, extended, renewed, restated or replaced from
time to time.
"Subordinated Debt" means any and all indebtedness and obligations for
borrowed money (including, without limitation, principal, premium (if any),
interest, fees, charges, expenses, costs, professional fees and expenses, and
reimbursement obligations) at any time owing by Borrower to Subordinated
Creditor under the Subordinated Loan Documents, including but not limited to
such amounts as may accrue or be incurred before or after default or workout or
the commencement of any liquidation, dissolution, bankruptcy, receivership, or
reorganization case by or against Borrower.
"Subordinated Loan Documents" means the Subordinated Notes, the
Subordinated Loan Agreement, the Subordinated Security Agreement, the
Subordinated Guaranty, and any other agreement, document, promissory note, UCC
financing statement, or instrument executed by Borrower pursuant to or in
connection with the Subordinated Debt, as the same may be amended, restated,
supplemented, modified, extended, renewed, restated or replaced from time to
time.
2. SUBORDINATION
(a) On the terms and conditions set forth below, Subordinated Creditor's
right to payment and performance of the Subordinated Debt is hereby subordinated
to each Senior Creditor's right to full payment and performance of any Senior
Debt. Subject to and except as set forth in Sections 3 and 4 below, Subordinated
Creditor shall not ask for, demand, xxx for, take or receive from Borrower, by
setoff or in any other manner, the whole or any part of any monies that may now
or hereafter be owing by Borrower to Subordinated Creditor, or be owing by any
other person to Subordinated Creditor under a guaranty or similar instrument, on
account of the Subordinated Debt, or any collateral security for any of the
foregoing, including, without limitation, any personal property collateral
granted to Subordinated Creditor pursuant to the Subordinated Loan Documents,
unless and until all Senior Debt shall have been paid in cash or otherwise
provided for in property or securities in the full amount of the allowed claim
of all Senior Debt and all commitments to extend credit under any Senior Loan
Documents shall have been terminated (the temporary reduction of outstanding
obligations, liabilities and indebtedness of Borrower to Senior Creditors not
being deemed to constitute full payment or satisfaction thereof).
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(b) Subordinated Creditor expressly understands that Senior Creditors are
expected not to permit Subordinated Creditor to create, maintain or perfect any
lien on or in any property of Borrower, other than the security interest granted
in favor of Subordinated Creditor in certain of Borrower's personal property
under and as described in the Subordinated Loan Agreement. If, notwithstanding
the foregoing, any lien shall be created or shall arise (including, without
limitation, the security interests granted in favor of Subordinated Creditor
pursuant to the Subordinated Loan Agreement), whether by operation of law or
otherwise, and may from time to time exist in favor of Subordinated Creditor in
or on any property of Borrower to secure all or any portion of the Subordinated
Debt, then, regardless of the relative times of attachment or perfection thereof
or the order of filing of financing statements, mortgages or other documents,
any liens granted by Borrower in favor of Senior Creditors to secure any Senior
Debt shall in all respects be first and senior liens, superior to any liens in
favor of Subordinated Creditor securing the Subordinated Debt, including,
without limitation, the security interests granted in favor of Subordinated
Creditor pursuant to the Subordinated Loan Agreement. In the event Subordinated
Creditor has or obtains possession of any such property or forecloses upon or
enforces its lien upon any such property, whether by judicial action or
otherwise, then all such property shall be immediately delivered in kind to
Senior Creditors or, if not deliverable in kind, all cash or non-cash proceeds
and profits of such property shall be held in trust for the benefit of each
Senior Creditor and paid over to Senior Creditors, without any deduction or
offset, unless and until all Senior Debts shall have been paid in cash or
otherwise provided for in property or securities in the full amount of the
allowed claim of all Senior Debts and all commitments to extend credit under the
Senior Loan Documents shall have been terminated.
(c) The subordination contained in this Agreement is intended to define the
rights and duties of Subordinated Creditor and Senior Creditors; it is not
intended that any third party (including any bankruptcy trustee, receiver, or
debtor-in-possession) shall benefit from it. If the effect of the subordination
contained in this Agreement would be to give any third party a priority status
to which that party would not otherwise be entitled, that provision shall, to
the extent necessary to avoid that priority, be given no effect and the rights
and priorities of Senior Creditors and Subordinated Creditor shall be determined
in accordance with applicable law and this Agreement.
3. PERMITTED PAYMENTS; PAYMENT BLOCKAGE
(a) Notwithstanding anything to the contrary contained in Section 2 above,
but subject expressly to Section 3(b) below, Borrower shall be permitted to
make, and Subordinated Creditor shall be permitted to request, demand, xxx for,
take and receive the following permitted payments ("Permitted Payments"): (i)
scheduled repayments of principal when due under the Subordinated Notes and
Subordinated Loan Agreement; (ii) scheduled payments of accrued interest when
due under the Subordinated Notes and Subordinated Loan Agreement; (iii) payments
of reimbursable expenses, costs and professional fees and expenses as and when
due under the Subordinated Notes and the other Subordinated Loan Documents; and
(iv) other payments consented to in writing by each Senior Creditor.
(b) Notwithstanding anything to the contrary contained in this Section 3 or
elsewhere in this Agreement, if a Senior Creditor delivers to Subordinated
Creditor written notice (a "Blockage Notice") that states that either:
(i) a specific default by Borrower involving the payment of
Senior Debt (a "Payment Default") has occurred under the Senior Loan
Documents and continues to exist after the giving of any required
notice and the expiration of any applicable grace or cure period; or
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(ii) a specific default by Borrower not involving the payment of
Senior Debt (a "Non-Payment Default") has occurred under the Senior
Loan Documents and continues to exist after the giving of any required
notice and the expiration of any applicable grace or cure period, and
said Non-Payment Default shall have resulted in such Senior Debt
becoming or being declared due and payable prior to the date on which
it would otherwise have become due and payable (an "Acceleration
Notice");
then, from and after the date of delivery of any such Blockage Notice,
Subordinated Creditor shall not accept or receive any payment of any kind of or
on account of the Subordinated Debt (including any Permitted Payment), unless
and until (A) in the case of a Blockage Notice with respect to a Payment
Default, the earlier of (x) the time such Payment Default shall have been cured
by Borrower or waived in writing by such Senior Creditor, or (y) the expiration
of the Blockage Period (as defined below) for such Blockage Notice, or (B) in
the case of a Blockage Notice with respect to a Non-Payment Default, the earlier
of (x) the time such Acceleration Notice shall have been rescinded in writing by
such Senior Creditor (whether or not such Non-Payment Default shall have been
cured or waived), or (y) the expiration of the Blockage Period for such Blockage
Notice.
As used herein, "Blockage Period" means a period of time beginning on the
date a Blockage Notice is delivered to Subordinated Creditor and terminating on
the earlier to occur of:
(a) 120 days following such date; provided, that if, prior to the
expiration of such 120-day period, a Senior Creditor has commenced a
judicial proceeding or non-judicial actions to collect or enforce a Senior
Debt or the collateral for a Senior Debt, or a case or proceeding by or
against Borrower is commenced under the federal Bankruptcy Code or any
other insolvency law, then such period shall be extended during the
continuation of such proceedings and actions until the payment in cash or
other property or securities in the full amount of the allowed claim of
such Senior Debt; or
(b) such Senior Creditor's written consent to such termination.
A Senior Creditor shall not issue more than one (1) Blockage Notice in any
period of 365 consecutive days. Upon the termination of a Blockage Period in
accordance with the preceding sentence, Subordinated Creditor shall be entitled
to receive all Permitted Payments, including any payments blocked during such
Blockage Period.
4. ENFORCEMENT RIGHTS
Notwithstanding anything to the contrary contained in Section 2 above,
during any Blockage Period, Subordinated Creditor shall not (a) accelerate the
maturity of the Subordinated Debt, (b) enforce any claim (including any default
remedy) with respect to the Subordinated Debt or the collateral for the
Subordinated Debt, or (c) take any other action against Borrower or Borrower's
property with respect to the Subordinated Debt.
5. ASSIGNMENT OF SUBORDINATED DEBT
Subordinated Creditor hereby covenants to each Senior Creditor that prior
to the termination of this Agreement in accordance with Section 10 below, the
entire Subordinated Debt created in favor of Subordinated Creditor shall
continue to be owing only to Subordinated Creditor, and any collateral security
therefor (including, without limitation, the collateral security
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granted to Subordinated Creditor pursuant to the Subordinated Loan Agreement)
shall continue to be held solely for the benefit of Subordinated Creditor,
unless assigned pursuant to an assignment made expressly subject to this
Agreement. The Subordinated Notes shall be legended to expressly state that they
are subject to this Subordination Agreement.
6. SENIOR CREDITORS' PRIORITY
In the event of any distribution, division, or application, partial or
complete, voluntary or involuntary, by operation of law or otherwise, of all or
any part of the property of Borrower or the proceeds thereof to the creditors of
Borrower, or the readjustment of a Senior Debt and the Subordinated Debt of
Borrower, whether by reason of liquidation, bankruptcy, arrangement,
receivership, assignment for the benefit of creditors or any other action or
proceeding involving the readjustment of all or any part of a Senior Debt or the
Subordinated Debt, or the application of the property of Borrower to the payment
or liquidation thereof, or upon the dissolution, liquidation, reorganization, or
other winding up of Borrower's business, or upon the sale of all or any
substantial part of Borrower's property (any of the foregoing being hereinafter
referred to as an "Insolvency Event"), then, and in any such event, each Senior
Creditor shall be entitled to receive payment in cash or other property or
securities in the full amount of the allowed claim of any Senior Debt, before
Subordinated Creditor shall be entitled to receive any payment on account of the
Subordinated Debt, and to that end and in furtherance thereof:
(a) All payments and distributions of any kind or character, whether in
cash, property, or securities, in respect of the Subordinated Debt to which
Subordinated Creditor would be entitled if the Subordinated Debt were not
subordinated pursuant to this Agreement, shall be paid to Senior Creditors and
applied in payment of all Senior Debt.
(b) Subordinated Creditor shall file a claim or claims, on the form
required in such proceedings, on or before thirty (30) days prior to the last
date such claims or proofs of claim may be filed pursuant to law or the order of
any court exercising jurisdiction over such proceeding.
(c) In the event that, notwithstanding the foregoing, any payment or
distribution of any kind or character, whether in cash, properties or
securities, shall be received by Subordinated Creditor on account of the
Subordinated Debt before all Senior Debt have been paid, then such payment or
distribution shall be received by Subordinated Creditor in trust for and shall
be promptly paid over to Senior Creditors for application to the payment of
amounts due on Senior Debt until all Senior Debt shall have been paid in cash,
property, or securities in the full amount of the allowed claim of all Senior
Debt.
7. GRANT OF AUTHORITY
In the event of the occurrence of an Insolvency Event, and in order to
enable each Senior Creditor to enforce its rights hereunder in any of the
aforesaid actions or proceedings, each Senior Creditor is hereby irrevocably
authorized and empowered, in each Senior Creditor's discretion, as follows:
(a) Each Senior Creditor is hereby irrevocably authorized and empowered (in
its own name or in the name of Subordinated Creditor or otherwise), but shall
have no obligation, (i) to demand, xxx for, collect and receive every payment or
distribution referred to in Section 6 above, and give acquittances therefor,
(ii) (if Subordinated Creditor has failed to file claims or proofs of claim on
or before thirty (30) days prior to the last date such claims or proofs of claim
may be filed pursuant to law or the order of any court exercising jurisdiction
over such proceeding) to file claims and proofs of claim, and (iii) to take such
other action (including,
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without limitation, enforcing any lien securing payment of the Subordinated
Debt) as it may deem necessary or advisable for the exercise or enforcement of
any of the rights or interests of each Senior Creditor hereunder. Subordinated
Creditor shall duly and promptly take such action as each Senior Creditor may
reasonably request to execute and deliver to each Senior Creditor such
authorizations, endorsements, assignments, or other instruments as each Senior
Creditor may reasonably request in order to enable each Senior Creditor to
enforce any and all claims with respect to, and any liens securing payment of,
the Subordinated Debt as such enforcement is contemplated herein.
(b) To the extent that payments or distributions on account of the
Subordinated Debt are made in property or securities other than cash,
Subordinated Creditor authorizes Senior Creditors to sell or dispose of such
property or securities on such terms as are commercially reasonable in the
situation in question. Following full payment of all Senior Debt, each Senior
Creditor shall remit to Subordinated Creditor (with all necessary endorsements)
to the extent of Subordinated Creditor's interest therein, all payments and
distributions of cash, property, or securities paid to and held by such Senior
Creditor in excess of the allowed amount of such Senior Creditor's Senior Debt.
8. PAYMENTS RECEIVED BY SUBORDINATED CREDITOR
Should any payment, distribution, or security be received by Subordinated
Creditor upon or with respect to the Subordinated Debt (other than Permitted
Payments) prior to termination of this Agreement in accordance with Section 10
below, Subordinated Creditor shall receive and hold the same in trust for the
benefit of Senior Creditors and shall forthwith deliver the same to Senior
Creditors in precisely the form received (except for the endorsement or
assignment of Subordinated Creditor where necessary), for application to all
Senior Debt, and, until so delivered, the same shall be held in trust by
Subordinated Creditor as the property of Senior Creditor.
9. FURTHER ASSURANCES; COOPERATION
Subject to Section 16(b) below, Subordinated Creditor agrees to cooperate
with Senior Creditors and to take all actions that each Senior Creditor may
reasonably require to enable Senior Creditors to realize the full benefits of
this Agreement.
10. TERMINATION OF AGREEMENT
This Agreement shall be effective upon the date set forth in Section 21
below. After the effective date occurs, this Agreement shall remain in effect
and cannot be revoked or amended by Subordinated Creditor, except with the
written consent of each Senior Creditor.
11. ADDITIONAL AGREEMENTS FOR SENIOR CREDITORS
Each Senior Creditor may administer and manage its credit and other
relationships with Borrower in its own best interest, without notice to or
consent of Subordinated Creditor. At any time and from time to time, each Senior
Creditor may enter into any amendment or agreement with Borrower as each Senior
Creditor may deem proper, extending the time of payment of or renewing or
otherwise altering the terms of all or any of the obligations constituting
Senior Debt or affecting the collateral security for, supporting or underlying
any or all Senior Debt, and may exchange, sell, release, surrender or otherwise
deal with any such collateral without in any way thereby impairing or affecting
this Agreement, and all such additional agreements and amendments shall be
"Senior Loan Documents" evidencing Senior Debt; provided, that neither this
Section 11 nor any provision of such agreements shall affect the limitations
contained in the definitions of Senior Creditor or Senior Debt.
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12. SUBROGATION
If cash or other property otherwise payable or deliverable to Subordinated
Creditor or on account of the Subordinated Debt shall have been applied pursuant
to this Agreement to the payment of a Senior Debt, and if a Senior Debt shall
have been paid in cash, property or securities in the full amount of the allowed
claim of a Senior Debt, then Subordinated Creditor shall be subrogated to any
rights of Senior Creditors to receive further payments or distributions
applicable to Senior Debt until the Subordinated Debt shall have been fully
paid. No such payments or distributions received by Subordinated Creditor by
reason of such subrogation shall, as between Borrower and its creditors other
than Senior Creditors, on the one hand, and Subordinated Creditor, on the other
hand, be deemed to be a payment by Borrower on account of the Subordinated Debt
owed to Subordinated Creditor.
13. SUBORDINATED CREDITOR'S WAIVERS AND COVENANTS
Without limiting the generality of any other waiver made by Subordinated
Creditor in this Agreement, Subordinated Creditor hereby expressly waives (i)
reliance by Senior Creditors upon the subordination and other agreements herein
provided, and (ii) any claim that Subordinated Creditor may now or hereafter
have against Senior Creditors arising out of any and all actions that Senior
Creditors, in good faith, takes or omits to take (A) with respect to the
creation, perfection or continuation of liens in or on any collateral security
for Senior Debt, (B) with respect to the foreclosure upon, sale, release, or
depreciation of, or failure to realize upon, any of the collateral security for
Senior Debt, (C) with respect to the collection of any claim for all or any part
of Senior Debt from any account debtor, guarantor or any other third party and
(D) with respect to the valuation, use, protection or release of any collateral
security for Senior Debt.
14. REINSTATEMENT OF SENIOR DEBT
To the extent that Senior Creditors receive payments on or proceeds of any
collateral security for Senior Debt that are subsequently invalidated, declared
to be fraudulent or preferential, set aside or required to be repaid to a
trustee, receiver or any other party under any bankruptcy law, state or federal
law, common law, or equitable cause, then, to the extent of such payment or
proceeds invalidated, declared to be fraudulent or preferential, set aside or
required to be repaid, such Senior Debt, or part thereof, intended to be
satisfied shall be revived and continue in full force and effect as if such
payments or proceeds had not been received by Senior Creditors.
15. NO WAIVERS
No Senior Creditor shall be prejudiced in its rights under this Agreement
by any act or failure to act of Borrower or Subordinated Creditor or any
noncompliance of Borrower or Subordinated Creditor with any agreement or
obligation, regardless of any knowledge thereof that such Senior Creditor may
have, or with which such Senior Creditor may be charged; and no action permitted
hereunder taken by such Senior Creditor shall in any way affect or impair the
rights of such Senior Creditor in the exercise of any other right or remedy or
shall operate as a waiver thereof, and no single or partial exercise by such
Senior Creditor of any right or remedy shall preclude any other or further
exercise thereof; nor shall any modification or waiver of any of the provisions
of this Agreement be binding upon such Senior Creditor, except as expressly set
forth in a writing duly signed and delivered by such Senior Creditor.
16. INFORMATION CONCERNING BORROWER; CREDIT ADMINISTRATION
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(a) Subordinated Creditor hereby assumes responsibility for keeping itself
informed of the financial condition of Borrower, any and all endorsers and any
and all guarantors of Senior Debt and of all other circumstances bearing upon
the risk of nonpayment of any Senior Debt or the Subordinated Debt that diligent
inquiry would reveal, and Subordinated Creditor hereby agrees that Senior
Creditors shall have no duty to advise Subordinated Creditor of information
known to Senior Creditors regarding such condition.
(b) Subject to Sections 3, 4, 7, and 8 above, Subordinated Creditor may (i)
administer and manage its credit and other relationships with Borrower in its
own best interests, and (ii) amend or extend its agreements with Borrower or
enter into additional agreements with Borrower, all without the consent of or
notice to Senior Creditors; provided that neither this Section 16(b) nor any
amendments or additional agreements referred to herein shall impair or affect
the subordination of Subordinated Debt or change the definition of Subordinated
Debt or Subordinated Creditor.
17. NOTICES
Except as otherwise provided herein, all notices and service of process
required, contemplated, or permitted hereunder or with respect to the subject
matter hereof shall be in writing, and shall be deemed to have been validly
served, given or delivered upon the earlier of: (i) the first business day after
transmission by facsimile or hand delivery or deposit with an overnight express
service or overnight mail delivery service; or (ii) the third calendar day after
deposit in the United States mails, with proper first class postage prepaid, and
shall be addressed to the party to be notified as follows:
(a) If to Subordinated Creditor:
Comdisco, Inc./Comdisco Ventures
0000 Xxxxx Xxxxx Xxxx
Xxxxxxxx, XX 00000
Attn: Legal Department
Fax (000) 000-0000
With a copy to:
Comdisco Ventures
000 Xxxxxxxx Xxxxxx, Xxxxx 000X
Xxxx Xxxx, XX 00000
Attn: Xxxxxx Xxxxx
Fax (000) 000-0000
Ph (000) 000-0000
(b) If to Borrower:
Princeton Review Publishing, L.L.C.
0000 Xxxxxxxx
Xxx Xxxx, XX 00000
Attn: Xxxx Xxxxxxx, President
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
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(c) If to a Senior Creditor, at such address as such Senior Creditor shall
designate in a writing given to Subordinated Creditor and Borrower, or (in all
cases) to such other address as each party may designate for itself by like
notice.
18. SEVERABILITY
Wherever possible, each provision of this Agreement shall be interpreted in
such a manner as to be effective and valid under applicable law, but if any
provision of this Agreement shall be prohibited by or invalid under applicable
law, such provision shall be ineffective to the extent of such prohibition or
invalidity, without invalidating the remainder of such provision or the
remaining provisions of this Agreement.
19. GOVERNING LAW
This Agreement has been approved by Subordinated Creditor in the State of
Illinois, and shall be governed by and interpreted in accordance with the laws
of the State of Illinois without regard to principles of conflict of laws that
would cause the application of laws of any other jurisdiction.
20. ASSIGNMENT
This Agreement shall be binding upon Subordinated Creditor, Borrower and
their respective successors and assigns, and shall inure to the benefit of and
be enforceable by Senior Creditor and its successors and assigns.
21. EFFECTIVENESS OF AGREEMENT
This Agreement shall be effective with respect to each Senior Creditor upon
the occurrence of both of the following events: (a) the execution of this
Agreement by Borrower and its acceptance in Rosemont, Illinois by Subordinated
Creditor; and (b) the delivery by Borrower and such Senior Creditor to
Subordinated Creditor of written notice (the "Notice of Senior Loan") in the
form attached hereto as Exhibit A, that Borrower has entered into Senior Loan
Documents with a Senior Creditor for Senior Debt, which notice shall identify
such Senior Creditor and state the address to which notices to such Senior
Creditor are to be sent. Borrower agrees to furnish Subordinated Creditor with a
copy of the Senior Loan Documents as Subordinated Creditor shall reasonably
request; provided, that any delay or failure by Borrower to furnish such copies
shall not limit or impair the effectiveness of this Agreement.
22. MUTUAL WAIVER OF JURY TRIAL
Because disputes arising in connection with complex financial transactions
are most quickly and economically resolved by an experienced and expert person
and the parties wish applicable state and federal laws to apply (rather than
arbitration rules), the parties desire that their disputes be resolved by a
judge applying such applicable laws. EACH OF BORROWER, SUBORDINATED CREDITOR,
AND SENIOR CREDITOR SPECIFICALLY WAIVES SUCH PARTY'S RIGHT TO TRIAL BY JURY OF
ANY CAUSE OF ACTION, CLAIM, CROSS-CLAIM, COUNTERCLAIM, THIRD PARTY CLAIM OR ANY
OTHER CLAIM (COLLECTIVELY, "CLAIMS") ASSERTED BY BORROWER, SUBORDINATED
CREDITOR, OR SENIOR CREDITOR AGAINST THE OTHER PARTY OR PARTIES TO THIS
AGREEMENT. This waiver extends to all such claims, including, without
limitation, claims that involve persons or entities other than Borrower,
Subordinated Creditor, and Senior Creditors; claims that arise out of or are in
any way connected to the relationships between or among Borrower, Subordinated
Creditor, and Senior Creditors; and any claims for damages, breach of contract,
specific performance, or any equitable or legal relief of any kind.
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23. COUNTERPARTS
This Agreement and any amendments, waivers, consents or supplements hereto
may be executed in any number of counterparts, and by different parties hereto
in separate counterparts, each of which when so executed and delivered shall be
deemed an original, but all of which counterparts together shall constitute but
one and the same instrument and facsimile signatures shall be deemed originals.
[Remainder of Page Intentionally Left Blank]
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IN WITNESS WHEREOF, this Subordination Agreement has been executed as of
the date first above written.
BORROWER PRINCETON REVIEW PUBLISHING, L.L.C.
Signature: /s/ Xxxx Xxxxxxx
-----------------------
Print Name: Xxxx Xxxxxxx
-----------------------
Title: President
-----------------------
ACCEPTED IN ROSEMONT, ILLINOIS:
------------------------------
SUBORDINATED CREDITOR COMDISCO, INC.
Signature: /s/ Xxxxxx Xxxxx
-----------------------
Print Name: Xxxxxx Xxxxx
-----------------------
Title: Managing Director
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EXHIBIT A
TO SUBORDINATION AGREEMENT
NOTICE OF SENIOR LOAN
Pursuant to Section 21 of the Subordination Agreement dated as of October
1, 2001, by and between Comdisco, Inc., as Subordinated Creditor, and PRINCETON
REVIEW PUBLISHING, L.L.C., as Borrower, notice is hereby given that Borrower has
entered into Senior Loan Documents with [_______________________] (as Senior
Creditor), whose address is: [________________________________] Facsimile:
[___.___.____], and that on and after the date of this Notice, Senior Creditor
is and shall be entitled to all the rights and benefits of the Subordination
Agreement and shall be bound thereby.
Attached hereto are true and correct copies, as executed, of the Senior
Loan Documents.
BORROWER: PRINCETON REVIEW PUBLISHING, L.L.C.
Signature:
---------------
Print Name:
---------------
Title:
---------------
SENIOR CREDITOR:
------------------------------------
[NAME]
Signature:
---------------
Print Name:
---------------
Title:
---------------
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