THIRD AMENDMENT
THIS
THIRD AMENDMENT (this “Agreement”)
is
made as of November 20, 2008, by and among MRU Holdings, Inc., a Delaware
corporation (the “Company”);
Embark Corp., a Delaware corporation (“Embark”),
Embark Online, Inc, a Delaware corporation (“Embark
Online”),
Goto
College Holdings Inc., a Delaware corporation (“Goto
College”),
iempower, inc., a Delaware corporation (“iempower”),
MRU
Originations, Inc., a Delaware corporation (“MRU
Originations”),
and
MRU Universal Guaranty Agency, Inc., a Delaware corporation (“MRU
Universal”;
Embark, Embark Online, Goto College, iempower, MRU Originations and MRU
Universal, collectively, the “Included Subsidiaries”),
each
of which is a Subsidiary of the Company; Longview Marquis Master Fund, L.P.,
a
British Virgin Islands limited partnership (including as successor to The
Longview Fund, L.P., a California limited partnership, under the Purchase
Agreement (as defined below), “Buyer”);
and
Viking Asset Management, LLC, a California limited liability company, in its
capacity as collateral agent for the benefit of Buyer (together with its
successors and assigns in such capacity, the “Collateral
Agent”).
Capitalized terms used but not otherwise defined herein shall have the meanings
ascribed to them in the Purchase Agreement (as amended hereby) (as defined
below) and, if not defined therein, in the Notes (as defined below) and, if
not
defined therein, then in the Security Agreement (as defined below).
W
I T N E
S S E T H:
WHEREAS,
the Company and Buyer are party to that certain Securities Purchase Agreement,
dated as of October 19, 2007 (as amended by the First Amendment and the Second
Amendment (each, as defined below), and as may be further amended, restated,
supplemented or otherwise modified and in effect from time to time, and together
with that certain letter agreement dated June 9, 2008 between the Company and
Buyer, the “Purchase
Agreement”),
pursuant to which the Company issued those certain senior secured notes, each
dated October 19, 2007, in an aggregate original principal amount of $11,200,000
that are held by Buyer as of the date hereof (such notes, together with any
promissory notes or other securities issued in exchange or substitution therefor
or replacement thereof, and as amended by the First Amendment and the Second
Amendment, and as any of the same may be further amended, restated, supplemented
or otherwise modified and in effect from time to time, collectively, the
“Notes”);
WHEREAS,
the Company, the Included Subsidiaries and Buyer entered into that certain
Waiver and First Amendment, dated as of September 12, 2008 (the “First
Amendment”),
pursuant to which, among other things, the parties amended subsection (ii)(D)
of
the definition of the term “Indebtedness” set forth in the Appendix to the
Purchase Agreement and Buyer granted a limited waiver with respect to the breach
by the Company of Section 5(g) of the Purchase Agreement and an Event of Default
under Section 8(a)(ix) of each Note;
WHEREAS,
the Company, the Included Subsidiaries and Buyer entered into that certain
Second Amendment, dated as of October 17, 2008 (the “Second
Amendment”),
pursuant to which, among other things, the parties agreed to further amend
subsection (ii)(D) of the definition of the term “Indebtedness” set forth in the
Appendix to the Purchase Agreement;
WHEREAS,
subsequent to the Second Amendment, on each of November 3, 2008, November 10,
2008, November 12, 2008, November 13, 2008, November 15, 2008, November 17,
2008, November 18, 2008 and November 19, 2008, as disclosed in the Company’s
current reports on Form 8-K, as filed with the SEC, Buyer agreed to extend
the
deadlines set forth in the Second Amendment for compliance with the Company’s
covenant with respect to Indebtedness as it relates to accounts payable, in
each
case subject to the terms and conditions set forth in the Second
Amendment;
WHEREAS,
the parties desire to amend the Purchase Agreement as hereinafter set forth;
and
WHEREAS,
as a condition to Buyer entering into this Agreement, contemporaneously
herewith, (a) each of the Included Subsidiaries will execute and deliver a
security agreement (the “Security
Agreement”),
in
the form attached hereto as Exhibit
A,
pursuant to which, among other things, the Included Subsidiaries will grant
to
the Collateral Agent a first priority perfected security interest in all present
and future tangible and intangible assets of the Included Subsidiaries; (b)
Goto
College will execute and deliver a Pledge Agreement (the “Pledge
Agreement”),
in
the form attached hereto as Exhibit
B,
pursuant to which, among other things, Goto College will
pledge all of the capital stock or other equity interests in each of its direct
and indirect subsidiaries, and such capital stock or other equity interests
shall be Pledged Shares (as defined in the Pledge Agreement); (c) Embark will
execute and deliver a trademark security agreement (the “Trademark
Security Agreement”),
in the form attached hereto as Exhibit
C,
pursuant to which, among other things, Embark will grant to the Collateral
Agent
a continuing security interest in the Trademark Collateral (as defined in the
Trademark Security Agreement); and (d) Embark will execute and deliver a
copyright security agreement (the “Copyright
Security Agreement”),
in the form attached hereto as Exhibit
D,
pursuant to which, among other things, Embark will grant to the Collateral
Agent
a continuing security interest in the Copyright Collateral (as defined in the
Copyright Security Agreement).
NOW,
THEREFORE, in consideration of the agreements, provisions and covenants
contained herein and for other good and valuable consideration, the receipt
and
sufficiency of which are hereby acknowledged, each of the undersigned agrees
as
follows:
1. Amendments
to the Purchase Agreement.
Buyer
hereby agrees with the Company that, as of the date first above written, as
follows:
a. The
Appendix to the Purchase Agreement is hereby amended to insert the following
definitions into the Appendix to the Purchase Agreement as follows:
“Accounts
Payable Decrease Date”
shall
mean January 8, 2009, provided,
however,
that
after January 8, 2009, “Accounts
Payable Decrease Date”
shall
mean January 31, 2009 if all of the following conditions have been satisfied
on
January 8, 2009: (i) the Company and one or more third parties shall have
executed, and there shall be in effect, a term sheet or definitive documents
for
the sale of assets of the Company or any of its Subsidiaries, or for the sale
of
equity and/or securities of the Company, to such third party or parties (any
such sale, a “Sale
Transaction”)
that
will provide the Company with net proceeds of no less than the greater of (i)
$50,000,000 and (ii) such amount as the holders of the Notes representing at
least two-thirds (2/3) of the aggregate principal amount of all of the Notes
then outstanding determine in good faith and in consultation with the Company
is
reasonably necessary for the Company to operate its then existing business
on a
positive net income basis and to satisfy all of the Company’s then existing
Indebtedness and other financial obligations, including all of the Company’s
present and future obligations under the Notes (with respect to principal
thereof, interest and any premium thereon, and otherwise); (ii) the Company
has
received a nonrefundable deposit or advance with respect to such Sale
Transaction of, or otherwise has available, unrestricted and unencumbered funds
of no less than $11,200,000, and all such funds are held in a segregated bank
account in which the Collateral Agent has, for the benefit of the holders of
the
Notes, a valid perfected first priority security interest pursuant to an Account
Control Agreement (as defined in the Security Agreement) that requires that
all
such funds remain in such account until each of the Notes are repaid in full,
and such funds so remain in such account, except that such funds may be used
to
directly pay principal on the Notes in accordance with the terms of the Notes;
and (iii) the Company and each of its Subsidiaries are, and have been at all
times since November 20, 2008, in compliance in all material respects with
each
of the Transaction Documents, and there is no, and there has not at any time
since November 20, 2008 been, an “Event of Default,” or any event, condition or
circumstance that with the passage of time or the giving of notice (or both)
would constitute an “Event of Default” under any of the Notes; provided,
further,
however,
that if
all such conditions have been satisfied on January 8, 2009, but any of such
conditions is not satisfied on any date thereafter and prior to January 31,
2008, the “Accounts
Payable Decrease Date”
shall
be the first such date after January 8, 2009 on which any of such conditions
are
not satisfied.
2
“Collateral”
has
the
meaning assigned to such term in the Security Agreement.
“Copyright
Security Agreement”
means
that certain Copyright Security Agreement, dated as of November 20, 2008, by
and
between Embark Corp. and the Collateral Agent.
“Included
Subsidiaries”
means
Embark Corp., a Delaware corporation, Embark Online, Inc, a Delaware
corporation, Goto College Holdings Inc., a Delaware corporation, iempower,
inc.,
a Delaware corporation, MRU Originations, Inc., a Delaware corporation, and
MRU
Universal Guaranty Agency, Inc., a Delaware corporation.
“Pledge
Agreement”
means
that certain Pledge Agreement, dated as of November 20, 2008, by and between
Goto College Holdings Inc. and the Collateral Agent, and acknowledged by each
of
Embark Corp. and Embark Online, Inc.
“Security
Agreement”
means
that certain Security Agreement, dated as of November 20, 2008, by and among
the
Included Subsidiaries, the Collateral Agent and the Buyers.
“Trademark
Security Agreement”
means
that certain Trademark Security Agreement, dated as of November 20, 2008, by
and
between Embark Corp. and the Collateral Agent
b. The
Appendix to the Purchase Agreement is hereby amended by replacing the previously
existing definitions (and such previously existing definitions are hereby
deleted) of each of “Collateral
Agent,”
“Security
Documents”
and
“Transaction
Documents,”
respectively, with the following:
3
“Collateral
Agent”
has
the
meaning assigned to such term in the Pledge and Security Agreement or the
Security Agreement, as applicable.
“Security
Documents”
means
the Pledge and Security Agreement, the Guaranty, the Blocked Account Agreement,
the Security Agreement, the Pledge Agreement, the Trademark Security Agreement,
the Copyright Security Agreement, any Account Control Agreements and any other
agreements, documents and instruments executed concurrently herewith or at
any
time hereafter pursuant to which the Company, any of its Subsidiaries or any
other Person either (i) guarantees payment or performance of all or any
portion of the obligations hereunder or under any other instruments delivered
in
connection with the transactions contemplated hereby and by the other
Transaction Documents, and/or (ii) provides, as security for all or any portion
of such obligations, a Lien on any of its assets in favor of a Buyer, as any
or
all of the same may be amended, supplemented, restated or otherwise modified
from time to time.
“Transaction
Documents”
means
this Agreement, the Notes, the Pledge and Security Agreement, the Blocked
Account Agreement, the Guaranty, the Security Agreement, the Pledge Agreement,
the Trademark Security Agreement, the Copyright Security Agreement, any Account
Control Agreements and each of the other agreements or instruments to which
the
Company or any of its Subsidiaries is a party or by which it is bound and which
is entered into by the parties hereto or thereto in connection with the
transactions contemplated hereby and thereby.
c. Subclause
(ii)(D) of the definition of the term “Indebtedness” set forth in the Appendix
to the Purchase Agreement is hereby amended and restated in its entirety to
read
as follows:
“(D)
not
exceeding at any one time an aggregate amount among the Company and its
Subsidiaries of (1) on or prior to the Accounts Payable Decrease Date,
$12,000,000 and (2) after the Accounts Payable Decrease Date,
$5,000,000.”
d. Section
4(c) of the Purchase Agreement is hereby amended to replace the phrase “During
the period commencing on the date of this Agreement and ending on the date
on
which no Notes remain outstanding and the Pledge and Security Agreement has
been
terminated (the period ending on such latest date, the “Reporting
Period”),”
at
the beginning of the first sentence thereof, with the phrase “During the period
commencing on the date of this Agreement and ending on the first date on which
no Notes remain outstanding and each of the Pledge and Security Agreement and
the Security Agreement has been terminated (the period ending on such latest
date, the “Reporting
Period”),”.
e. Section
4(g) of the Purchase Agreement is hereby amended and restated in its entirety
to
read as follows:
4
“g. Minimum
Cash Balance.
At all
times during the Reporting Period, (i) the Company shall maintain unrestricted
and unencumbered cash on hand (net of any payments out from the Company and
its
Subsidiaries in process) in an aggregate amount of not less than $4,350,000,
and
(ii) Embark shall maintain unrestricted and unencumbered cash on hand (net
of
any payments out from Embark in process) in an aggregate amount of not less
than
$1,500,000.”
f. Each
of
Sections 4(i), 4(n), 4(o) and 4(t) of the Purchase Agreement are hereby amended
to insert “Collateral,” immediately prior to each reference to the term “Pledged
Collateral” contained in such Sections.
g. Section
4(r) of the Purchase Agreement is hereby amended to replace the phrase “From the
date of this Agreement until the first date following the Closing Date on which
the Notes are no longer outstanding and the Pledge and Security Agreement has
terminated,” at the beginning of the first sentence thereof, with the phrase
“During the Reporting Period,”.
h. Section
5(d) of the Purchase Agreement is hereby amended to insert into the proviso
“provided,
however,
that
any Subsidiary may declare, set aside or pay dividends on or make any other
distributions (whether in cash, stock, equity securities or property) in respect
of any of its Capital Stock that is held solely by the Company or a wholly-owned
domestic Subsidiary” in subsection (i) thereof, the phrase “that is not an
Included Subsidiary” immediately following the first reference to the term
“Subsidiary” and immediately prior to the word “may.”
i. Section
5(f) of the Purchase Agreement is hereby amended to insert into the proviso
“provided,
however,
that
any Subsidiary may prepay any Indebtedness to the Company or a wholly-owned
domestic Subsidiary (other than the Excluded Subsidiaries) of the Company” at
the end of Section 5(f) of the Purchase Agreement, the phrase “that is not an
Included Subsidiary” immediately following the first reference to the term
“Subsidiary” and immediately prior to the word “may.”
j. Section
5(g) of the Purchase Agreement is hereby amended to insert the parenthetical
“(excluding the Included Subsidiaries)” into subsection (iii) thereof
immediately following the term “Subsidiaries” and immediately prior to the word
“that.”
k. Section
5(i) of the Purchase Agreement is hereby amended and restated to read in its
entirety as follows:
“Sale
of Collateral.
During
the Reporting Period, neither the Company nor any of the Subsidiaries shall
sell, transfer, assign or dispose of any Collateral, Pledged Collateral or
Account Collateral, except pursuant to the Pledge and Security Agreement, the
Blocked Account Agreement or any of the other Security Documents.”
l. Section
5(l) of the Purchase Agreement is hereby amended to insert the following proviso
immediately prior to the period at the end of subsection (ii) thereof, such
proviso to read in its entirety as follows:
“;
provided,
however,
that
neither the Company nor any Subsidiary may issue, transfer or pledge any capital
stock or equity interest in any Included Subsidiary to any Person.”
5
m. As
amended hereby, the Purchase Agreement remains in full force and
effect.
2. Representations
and Warranties of the Company.
The
Company represents and warrants to Buyer that:
a. Authorization;
Enforcement; Validity.
Each of
the Company and the Included Subsidiaries is a duly organized and validly
existing corporation and has the requisite corporate power and authority to
enter into and perform its obligations under this Agreement, the Security
Agreement, the Pledge Agreement, the Trademark Security Agreement, the Copyright
Security Agreement, the Purchase Agreement (as amended hereby) and the other
Transaction Documents. The execution and delivery of this Agreement, the
Security Agreement, the Pledge Agreement, the Trademark Security Agreement
and
the Copyright Security Agreement by the Company and the Included Subsidiaries
(as applicable), and the consummation of the transactions contemplated hereby
and thereby, by the Purchase Agreement (as amended hereby) and by the other
Transaction Documents have been duly authorized by the respective boards of
directors of the Company and the Included Subsidiaries, and no further consent
or authorization is required by the Company, the Included Subsidiaries or their
respective boards of directors or shareholders. Each of this Agreement, the
Security Agreement, the Pledge Agreement, the Trademark Security Agreement
and
the Copyright Security Agreement has been duly executed and delivered by the
Company and each of the Included Subsidiaries, and each of this Agreement,
the
Security Agreement, the Pledge Agreement, the Trademark Security Agreement,
the
Copyright Security Agreement, the Purchase Agreement (as amended hereby) and
the
other Transaction Documents constitutes a valid and binding obligation of each
of the Company (as applicable) and the Included Subsidiaries (as applicable),
enforceable against each of the Company (as applicable) and the Included
Subsidiaries (as applicable) in accordance with its terms. Any Account Control
Agreements entered into by any of the Included Subsidiaries in connection with
Section 5(a) hereof, upon delivery to the Collateral Agent as required by such
Section 5(a), shall have been duly executed and delivered by such Included
Subsidiaries, and each of such Account Control Agreements shall constitute
the
valid and binding obligations of such Included Subsidiaries, enforceable against
such Included Subsidiaries in accordance with its terms.
b. No
Conflicts.
The
execution and delivery of this Agreement, the Security Agreement, the Pledge
Agreement, the Trademark Security Agreement, the Copyright Security Agreement
and any Account Control Agreements by each of the Company (as applicable) and
the Included Subsidiaries (as applicable), the performance by each of the
Company (as applicable) and the Included Subsidiaries (as applicable) of their
respective obligations hereunder and thereunder, under the Purchase Agreement
(as amended hereby) and under the other Transaction Documents, and the
consummation by each of the Company and the Included Subsidiaries (as
applicable) of the transactions contemplated hereby, by the Security Agreement,
by the Pledge Agreement, by the Trademark Security Agreement, by the Copyright
Security Agreement, by any Account Control Agreements, by the Purchase Agreement
(as amended hereby) and by the other Transaction Documents will not (i) result
in a violation of the certificate of incorporation or the bylaws of the Company
or the organizational documents of any Subsidiary; (ii) conflict with, or
constitute a breach or default (or an event which, with the giving of notice
or
lapse of time or both, constitutes or would constitute a breach or default)
under, or give to others any right of termination, amendment, acceleration
or
cancellation of, or other remedy with respect to, any agreement, indenture
or
instrument to which the Company or any of the Subsidiaries is a party; or (iii)
result in a violation of any law, rule, regulation, order, judgment or decree
(including federal and state securities laws and regulations) applicable to
the
Company or any of the Subsidiaries or by which any property or asset of the
Company or any of the Subsidiaries is bound or affected. Neither the Company
nor
any of the Subsidiaries is required to obtain any consent, authorization or
order of or make any filing or registration with, any court or governmental
agency or any regulatory or self-regulatory agency in order for it to execute,
deliver or perform any of its obligations under, or contemplated by, this
Agreement, the Security Agreement, the Pledge Agreement, the Trademark Security
Agreement, the Copyright Security Agreement, any Account Control Agreements,
the
Purchase Agreement (as amended hereby) or the other Transaction
Documents.
6
c. No
Violation of Security Documents.
Neither
the Company nor any of the Included Subsidiaries has breached or violated any
of
the provisions of the Security Documents or taken any action that would impair,
or otherwise adversely affect, the rights of Buyer or the Collateral Agent
under
the Security Documents or otherwise with respect to the Collateral.
d. No
Event of Default.
After
giving effect to this Agreement, no Event of Default or event which, with notice
or the lapse of time or both, would constitute an Event of Default, exists
on
the date hereof.
e. Accounts
Payable; Cash on Hand.
As of
the date hereof, (i) the aggregate outstanding amount of the Accounts Payable
of
the Company and its Subsidiaries is more than $10,900,000 but less than
$11,200,000, (ii)
the
aggregate amount of unrestricted and unencumbered cash on hand of the Company
and its Subsidiaries (net of any payments out from the Company and its
Subsidiaries in process) is greater than $6,300,000 but less than
$6,500,000, and
(iii)
the aggregate amount of unrestricted and unencumbered cash on hand of Embark
(net of any payments out from Embark in process) is greater than $2,700,000
but
less than $2,900,000.
f. No
Other Subsidiaries.
Except
as set forth on Schedule 3(a) to the Purchase Agreement, the Company does not
have any Subsidiaries.
g. Equity
Held by Included Subsidiaries.
None of
the Included Subsidiaries beneficially owns or otherwise holds any voting
securities of, or other equity or similar interests in, any other Person, except
that Goto College directly owns beneficially and of record all of the voting
securities of, and equity interests in, each of Embark and Embark
Online.
h. Accounts
of the Included Subsidiaries.
No
Included Subsidiary, other than Embark, maintains any bank, brokerage or other
similar accounts (each, an “Account”),
and
the only Account maintained by Embark, or in which Embark has any interest,
is
that certain account identified on the date hereof on Schedule
VI
to the
Security Agreement (the “Embark
Account”),
which
Embark Account includes all funds of Embark, including all funds received by
Embark in connection with those certain Service Agreements entered into between
Embark and certain institutions of higher education and other
customers.
7
3. Representation
and Warranties of Buyer.
Buyer
represents and warrants to the Company that (a) Buyer is a validly existing
limited partnership and has the requisite limited partnership power and
authority to enter into and perform its obligations under this Agreement, and
(b) this Agreement has been duly and validly authorized, executed and delivered
on behalf of Buyer and is a valid and binding agreement of Buyer, enforceable
against Buyer in accordance with its terms.
4. Acknowledgment
of the Company and the Included Subsidiaries. The
Company and each of the Included Subsidiaries hereby irrevocably and
unconditionally acknowledge, affirm and covenant to Buyer that:
a. Buyer
is
not in default under any of the Transaction Documents and has not otherwise
breached any obligations to the Company or any of the Subsidiaries;
and
b. there
are
no offsets, counterclaims or defenses to the Liabilities (as defined in the
Amended and Restated Security Agreement) or Obligations (as defined in the
Subsidiary Guaranty), including the liabilities and obligations of the Company
under the Purchase Agreement (as amended hereby) and the other Transaction
Documents, or to the rights, remedies or powers of Buyer in respect of any
of
the Liabilities or Obligations or any of the Transaction Documents, and the
Company and each of the Included Subsidiaries agree not to interpose (and each
does hereby waive and release) any such defense, set-off or counterclaim in
any
action brought by Buyer with respect thereto.
5. Covenants.
a. New
Accounts.
During
the Reporting Period, none of the Included Subsidiaries shall open, maintain
or
hold any funds or securities in any Account unless, contemporaneously with
the
opening of such Account, such Included Subsidiary has delivered to the
Collateral Agent an Account Control Agreement (as defined in the Security
Agreement) with respect to such Account, duly executed by such Included
Subsidiary and the applicable bank, brokerage firm or other financial
institution.
b. Disclosure.
Prior
to 3:00 p.m., New York City time, on the second Business Day following the
date
hereof, the Company shall file a current report on Form 8-K (the “Amendment
Form 8-K”)
with
the SEC, describing the terms of this Agreement, in the form required by the
1934 Act, and attaching as exhibits thereto each of this Agreement, the Security
Agreement, the Pledge Agreement, the Trademark Security Agreement and the
Copyright Security Agreement.
c. Termination
of Liens.
The
Company shall use its best efforts to file all agreements, instruments and
other
documents to terminate all Liens (other than the Liens in favor of the
Collateral Agent) filed against the Trademarks owned by Embark with the United
States Patent and Trademark Office as soon as reasonably practicable but in
any
event no later than December 31, 2008 and shall deliver, or cause to be
delivered, to Collateral Agent applicable agreements, instruments and other
documents in form and substance reasonably satisfactory to Collateral Agent
evidencing such termination promptly after the recordation thereof.
8
6. Limited
Waiver.
The
parties hereto acknowledge and agree that Section 3(a) of the First Amendment
shall be null and void and of no force or effect if the aggregate outstanding
amount of the Accounts Payable (as defined in the First Amendment) exceeds
$12,000,000 at any time following the date hereof through (and including) the
Accounts Payable Decrease Date.
7. Events
of Default.
The
parties hereto hereby acknowledge and agree that, notwithstanding anything
to
the contrary contained in the Notes or the other Transaction
Documents:
a. the
issuance of any judgment against the Company involving an aggregate liability
(including interest and legal and other fees and expenses) of not more than
$1,200,000 in connection with that certain lawsuit filed against the Company
in
the U.S. District Court for the Southern District of New York (Civil Action
No.
08 CV 9123), whereby BB&T Capital Markets alleges a breach of contract claim
against the Company, shall not constitute an “Event of Default” under Section
8(a)(xi) of the Notes, if the issuance of such judgment occurs on or prior
to
the Accounts Payable Decrease Date, so long as (i) the Company has diligently
contested, and not consented to, the issuance of such judgment, (ii) neither
the
Company nor any Subsidiary has made any payments in respect of such judgment;
(iii) no Person has begun to exercise any rights or remedies with respect to
such judgment through the filing or perfection of such judgment as against
any
assets of the Company or any of its Subsidiaries; and (iv) the Company and
its
Subsidiaries have not posted, or been ordered to post, a bond in an aggregate
amount in excess of $1,200,000 in connection therewith.
b. any
default by either MRU Funding SPV, Inc. or Education Empowerment SPV, LLC
pursuant to the Warehouse Documents to which such entity is a party, as a result
of a breach of a financial covenant thereunder, shall not constitute an “Event
of Default under Section 8(a)(iv) of the Notes, if such default occurs on or
prior to the Accounts Payable Decrease Date, so long as such default does not
provide any Person with, or result in any Person having, any rights, remedies
or
recourse against the Company or any Subsidiary.
8. Avoidance
of Doubt.
The
parties hereto hereby agree, for the avoidance of doubt, that the term
“Liabilities” and “Obligations” as used in the Transaction Documents shall
include all liabilities and obligations of the Company under this Agreement,
under the Security Agreement, under the Pledge Agreement, under the Trademark
Security Agreement, under the Copyright Security Agreement, under any Account
Control Agreements, under the Purchase Agreement (as amended hereby) and under
the other Transaction Documents, and each of the parties hereto agrees not
to
take any contrary positions. The parties hereto hereby agree, for the avoidance
of doubt, each of this Agreement, the Security Agreement, the Pledge Agreement,
the Trademark Security Agreement, the Copyright Security Agreement and any
Account Control Agreements constitutes a Transaction Document.
9. Expenses.
In
accordance with Section 4(i) of the Purchase Agreement, contemporaneously with
the execution and delivery of this Agreement, the Company shall reimburse Buyer
for all of its out-of-pocket fees, costs and expenses, including attorneys’ fees
and expenses, incurred in connection with the drafting, negotiation and
execution of this Agreement. The parties hereto acknowledge that such amount
is
$55,000.
9
10. Reservation
of Rights.
The
parties hereto hereby agree that any breach in any material respect by the
Company or any of the Included Subsidiaries of any of their respective
representations, warranties, covenants or other agreements contained herein
shall constitute an “Event of Default” under each of the Notes. Buyer has not
hereby waived (a) any breach, default or Event of Default that may be continuing
under any of the Transaction Documents or (b) any of Buyer’s rights or remedies
arising from any such breach, default or Event of Default or otherwise available
under the Transaction Documents or at law. Buyer expressly reserves all such
rights and remedies.
11. Successors
and Assigns.
This
Agreement shall be binding upon and shall inure to the benefit of the parties
hereto and their respective successors and permitted assigns. The successors
and
assigns of such entities shall include their respective receivers, trustees
or
debtors-in-possession.
12. Further
Assurances.
The
Company hereby agrees from time to time, as and when requested by Buyer, to
execute and deliver or cause to be executed and delivered, all such documents,
instruments and agreements, including secretary’s certificates, and to take or
cause to be taken such further or other action, as Buyer may reasonably deem
necessary or desirable in order to carry out the intent and purposes of this
Agreement, the Security Agreement, the Pledge Agreement, the Trademark Security
Agreement, the Copyright Security Agreement, any Account Control Agreements,
the
Purchase Agreement (as amended hereby) and the other Transaction
Documents.
13. Rules
of Construction.
All
words in the singular or plural include the singular and plural and pronouns
stated in either the masculine, the feminine or neuter gender shall include
the
masculine, feminine and neuter, and the use of the word “including” in this
Agreement shall be by way of example rather than limitation. The language used
in this Agreement will be deemed to be the language chosen by the parties to
express their mutual intent, and no rules of strict construction will be applied
against any party. Time is of the essence with respect to the performance by
the
Company and each of the Included Subsidiaries of each of their respective
covenants and agreements herein set forth.
14. Governing
Law; Jurisdiction; Jury Trial.
All
questions concerning the construction, validity, enforcement and interpretation
of this Agreement shall be governed by the internal laws of the State of New
York, without giving effect to any choice of law or conflict of law provision
or
rule (whether of the State of New York or any other jurisdiction) that would
cause the application of the laws of any jurisdiction other than the State
of
New York. Each party hereby irrevocably submits to the exclusive jurisdiction
of
the state and federal courts sitting in the City of New York, borough of
Manhattan, for the adjudication of any dispute hereunder or in connection
herewith or with any transaction contemplated hereby or discussed herein, and
hereby irrevocably waives, and agrees not to assert in any suit, action or
proceeding, any claim that it is not personally subject to the jurisdiction
of
any such court, that such suit, action or proceeding is brought in an
inconvenient forum or that the venue of such suit, action or proceeding is
improper. Each party hereby irrevocably waives personal service of process
and
consents to process being served in any such suit, action or proceeding by
mailing a copy thereof to such party at the address for such notices to it
under
this Agreement and agrees that such service shall constitute good and sufficient
service of process and notice thereof. Nothing contained herein shall be deemed
to limit in any way any right to serve process in any manner permitted by law.
EACH PARTY HEREBY IRREVOCABLY WAIVES ANY RIGHT IT MAY HAVE, AND AGREES NOT
TO
REQUEST, A JURY TRIAL FOR THE ADJUDICATION OF ANY DISPUTE HEREUNDER OR IN
CONNECTION HEREWITH OR ARISING OUT OF THIS AGREEMENT OR ANY TRANSACTION
CONTEMPLATED HEREBY.
10
15. Counterparts.
This
Agreement may be executed in two or more identical counterparts, all of which
shall be considered one and the same agreement and shall become effective when
counterparts have been signed by each party and delivered to each other party.
In
the event that any signature to this Agreement or any amendment hereto is
delivered by facsimile transmission or by e-mail delivery of a “.pdf” format
data file, such signature shall create a valid and binding obligation of the
party executing (or on whose behalf such signature is executed) with the same
force and effect as if such facsimile or “.pdf” signature page were an original
thereof. No party hereto shall raise the use of a facsimile machine or e-mail
delivery of a “.pdf” format data file to deliver a signature to this Agreement
or any amendment hereto or the fact that such signature was transmitted or
communicated through the use of a facsimile machine or e-mail delivery of a
“.pdf” format data file as a defense to the formation or enforceability of a
contract, and each party hereto forever waives any such defense.
16. Section
Headings.
The
section headings herein are for convenience of reference only, and shall not
affect in any way the interpretation of any of the provisions
hereof.
17. Merger.
This
Agreement, the Security Agreement, the Pledge Agreement, the Trademark Security
Agreement, the Copyright Security Agreement, the Purchase Agreement (as amended
hereby) and the other Transaction Documents entered into on or prior to the
date
hereof represent the final agreement of each of the parties hereto with respect
to the matters contained herein and may not be contradicted by evidence of
prior
or contemporaneous agreements, or prior or subsequent oral agreements, among
any
of the parties hereto.
18. Reaffirmation.
Each
of
the Company and the Included Subsidiaries as issuer, debtor, grantor, pledgor,
mortgagor, guarantor or assignor, or in other any other similar capacity in
which such Person grants Liens or security interests in its property or
otherwise acts as accommodation party or guarantor, as the case may be, hereby
(i)
acknowledges and agrees that it has reviewed this Agreement,
the
Security Agreement, the Pledge Agreement, the Trademark Security Agreement
and
the Copyright Security Agreement, (ii)
ratifies
and reaffirms
all of its obligations, contingent or otherwise, under each of the Transaction
Documents, including the Purchase Agreement (as amended hereby), to which it
is
a party (after giving effect hereto), and (iii) to the extent such Person
granted Liens on or security interests in any of its property pursuant to any
such Transaction Document as security for or otherwise guaranteed the
Liabilities or Obligations under or with respect to the Transaction Documents,
ratifies and reaffirms such guarantee and grant of security interests and Liens
and confirms and agrees that such security interests and Liens hereafter secure
all of the Liabilities and Obligations as amended hereby. Each of the Company
and the Included Subsidiaries hereby consents to this Agreement and acknowledges
that each of
the
Transaction Documents, including the Purchase Agreement (as amended
hereby),
remains
in full force and effect and is hereby ratified and reaffirmed.
11
[Remainder
of page intentionally left blank; Signature page follows]
12
IN
WITNESS WHEREOF, this Third Amendment has been duly executed and delivered
by
each of the undersigned as of the date first above written.
COMPANY:
MRU
HOLDINGS, INC.
|
By:
|
/s/
Xxxxxx Xxxx
|
|
Name:
|
Xxxxxx
Xxxx
|
|
Title:
|
Co-President
|
INCLUDED
SUBSIDIARIES:
EMBARK
CORP.
|
By:
|
/s/
Xxxxxx Xxxx
|
|
Name:
|
Xxxxxx
Xxxx
|
|
Title:
|
Chief
Executive Officer
|
EMBARK
ONLINE, INC.
|
By:
|
/s/
Xxxxxx Xxxx
|
|
Name:
|
Xxxxxx
Xxxx
|
|
Title:
|
Chief
Executive Officer
|
GOTO
COLLEGE HOLDINGS INC.,
|
By:
|
/s/
Xxxxxx Xxxx
|
|
Name:
|
Xxxxxx
Xxxx
|
|
Title:
|
President
|
IEMPOWER,
INC.
|
By:
|
/s/
Xxxxxx Xxxx
|
|
Name:
|
Xxxxxx
Xxxx
|
|
Title:
|
President
|
MRU
ORIGINATORS, INC.
|
By:
|
/s/
Xxxxxx Xxxx
|
|
Name:
|
Xxxxxx
Xxxx
|
|
Title:
|
President
|
MRU
UNIVERSAL GUARANTY AGENCY, INC.
|
By:
|
/s/
Xxxxxx Xxxx
|
|
Name:
|
Xxxxxx
Xxxx
|
|
Title:
|
President
|
BUYER:
LONGVIEW
MARQUIS MASTER
FUND,
L.P.
By:
Viking Asset Management, LLC
Its:
Investment Advisor
|
By:
|
/s/
S. Xxxxxxx Xxxxxxx
|
|
Name:
|
S.
Xxxxxxx Xxxxxxx
|
|
Title:
|
Chief
Financial Officer
|
COLLATERAL
AGENT:
VIKING
ASSET MANAGEMENT, L.L.C.
|
By:
|
/s/
S. Xxxxxxx Xxxxxxx
|
|
Name:
|
S.
Xxxxxxx Xxxxxxx
|
|
Title:
|
Chief
Financial Officer
|
Exhibit
A
Security
Agreement
Exhibit
B
Pledge
Agreement
Exhibit
C
Trademark
Security Agreement
Exhibit
D
Copyright
Security Agreement
