Exhibit 10.31

PLATO LEARNING, INC.
2006 STOCK INCENTIVE PLAN

PERFORMANCE SHARE AWARD AGREEMENT

PLATO Learning, Inc., a Delaware corporation (the “Company”), hereby grants to
[Name] (the “Participant”) on this [Date] (the “Grant Date”) a Performance Share
Award subject to the terms and conditions set forth herein and pursuant to the
provisions of the PLATO Learning, Inc. 2006 Stock Incentive Plan (the “Plan”)
and the Participant Annual Equity Incentive Plan (“Annual Incentive Plan”). Any
term capitalized herein, but not defined, will have the meaning set forth in the
Plan.

1. Performance Share Award Subject to Acceptance of Agreement.

The Award of any Performance Share pursuant to this Agreement will be null and
void unless the Participant accepts this Agreement by executing it in the space
provided below and returning it to the Company within thirty (30) days following
the Grant Date.

2. Terms of Performance Share Award.

2.1 Number of Performance Shares. In accordance with the terms of the Plan and
subject to the terms and conditions of this Agreement, the Company hereby grants
to the Participant (the “Award”) an aggregate of [Number] Performance Shares.
Each Performance Share represents the right to receive a distribution of one
share of the Company’s Common Stock, par value $.01 per share (each, a “Share”)
upon such Performance Share becoming vested in accordance with Section 2.2 and
2.3.

2.2 Vesting of Performance Shares. Except as otherwise provided herein and in
Section 2.3, the Performance Shares will vest and become nonforfeitable as
follows: (1) 33.3% of the Performance Shares (rounded down to the nearest whole
Share) shall be immediately vested as of the Grant Date; (2) 33.3% of the
Performance Shares (rounded down to the nearest whole Share) will vest on
December 10, 2009 so long as the Participant has remained continuously employed
up to and including such date; and (3) the remaining Performance Shares will
vest on December 10, 2010 so long as the Participant has remained continuously
employed up to and including such date.

  2.3   Termination of Service.

2.3 (a) Death, Disability, or Retirement. In the event a Participant’s
employment with the Company and any Affiliate terminates by reason of Death,
Disability, or Retirement any Performance Shares unvested at the time of the
Participant’s termination by reason of Death, Disability, or Retirement, shall
be forfeited.

2.3 (b) Voluntary Termination without Good Reason or Involuntary Termination
with Cause. For purpose of this Agreement “Good Reason” shall exist if the
Company, without Participant’s written consent: (i) materially reduces the
nature, scope, level or extent of Participant’s responsibilities; (ii) reduces
Participant’s salary; (iii) gives written notice to the Participant not to
extend the Term of any Employment Agreement in effect; or (iv) relocates
Participant’s principal business office to a location which is more than fifty
(50) miles from both (A) Participant’s principal business office immediately
prior to such relocation and (B) Participant’s principal place of residence at
the time of such relocation. For the purposes of this Agreement, “Cause” shall
mean Participant’s: (i) indictment or plea of guilty or nolo contendere
involving any felony or gross misdemeanor involving dishonesty, fraud, or breach
of trust under any law of the United States or any State thereof; (ii) willful
engagement in any conduct or gross negligence that in either case materially
injures the Company or any of its subsidiaries; or (iii) willful and substantial
nonperformance of assigned duties, provided that such nonperformance has
continued more than ten days after the Company has given written notice of such
nonperformance and of its intention to terminate Participant’s employment
because of such nonperformance. Upon Voluntary Termination without Good Reason
or Involuntary Termination with Cause any Performance Shares unvested at the
time of the Participant’s termination by reason of Voluntary Termination without
Good Reason or Involuntary Termination with Cause, shall be forfeited.

2.3 (c) Voluntary Termination with Good Reason or Involuntary Termination
without Cause. In the event a Participant’s employment with the Company and any
Affiliate is Voluntarily Terminated with Good Reason or Involuntarily Terminated
without Cause, at any time prior to the last vesting date of the Performance
Shares, all remaining unvested Performance Shares shall vest.

2.3 (d) Change in Control. If at any time prior to the last vesting date of the
Performance Shares there is a Change in Control, the Performance Shares shall
immediately vest.

2.4 Timing and Form of Payout. Within five business days following a Performance
Share becoming vested pursuant to Section 2.2 and 2.3, the Participant shall
receive a distribution of one corresponding Share.

2.5 Withholding Taxes. The Company will have the right to deduct or withhold, or
require the Participant to remit to the Company, the minimum amount necessary to
satisfy federal, state, and local taxes, domestic or foreign, as required by law
or regulation to be withheld with respect to any taxable event arising under
this Plan, including by withholding Shares otherwise distributable to the
Participant pursuant to this Agreement.

3. Restrictive Covenants.

If the Participant breaches any non-disclosure, non-compete, non-solicitation
provisions pursuant to Sections 3.1, 3.2 and 3.3 or other provisions of this
Agreement, whether during or after termination of Service, in addition to any
other penalties or restrictions that may apply under any employment agreement,
state law, or otherwise, the Participant will forfeit any and all Performance
Shares granted to him or her under this Agreement, including Shares that have
been distributed upon vesting of Performance Shares. In the event that the
Participant shall forfeit rights to any Shares to which the Performance Shares
relate, the Participant shall, within 10 days of the date of the Company’s
written request, return this Agreement to the Company for cancellation.

3.1 Non-Disclosure. Participant agrees not to directly or indirectly, without
the Company’s prior written consent: (i) use or disclose, for the benefit of any
person, firm or entity other than the Company and its subsidiaries, the
Confidential Business Information of the Company or any of its subsidiaries;
(ii) distribute or disseminate in any way to any person, firm or entity anyone
other than the Company and its subsidiaries, any Confidential Business
Information in any form whatsoever; (iii) copy any Confidential Business
Information other than for use by the Company or any of its subsidiaries;
(iv) remove any Confidential Business Information from the premises of the
Company; (v) fail to safeguard all confidential documents; and (vi) copy any
confidential documents belonging to any of the Company’s customers. For purposes
of this Agreement, “Confidential Business Information” means information or
material that is not generally available to or used by others or the utility or
value of which is not generally known or recognized as a standard practice,
whether or not the underlying details are in the public domain, including but
not limited to its computerized and manual systems, procedures, reports, client
lists, review criteria and methods, financial methods and practices, plans,
pricing and marketing techniques, business methods and procedures and other
valuable and proprietary information relating to the pricing, marketing, design,
manufacture and formulation of educational software, as well as information
regarding the past, present and prospective clients of the Company or any of its
subsidiaries, and their particular needs and requirements, and their own
confidential information. Upon termination of employment for any reason,
Participant agrees to return to the Company all policy and procedure manuals,
records, notes, data, memoranda, and reports of any nature (including
computerized and electronically stored information) which are in Participant’s
possession and/or control which relate to (i) the Confidential Business
Information of the Company or any of its subsidiaries, (ii) the business
activities or facilities of the Company or its past, present, or prospective
clients.

3.2 Non-Compete. During the period of Participant’s Service and for a period of
one (1) year following termination of this Agreement and Participant’s
employment for any reason (the “Restricted Period”), Participant will not
directly or indirectly, on his or her behalf, or as a partner, officer,
director, trustee, member, employee, or otherwise, within the United States or
in any foreign market in which Participant was engaged in activities on behalf
of the Company or any of its subsidiaries, own, engage in or participate in, in
any way, any business that is similar to or competitive with any actual or
planned business activity engaged in or planned by the Company or any of its
subsidiaries at the time the Participant was terminated. However, this Agreement
shall not prohibit ownership by Participant of up to 2% of the shares of stock
of any corporation the stock of which is listed on a national securities
exchange or is traded in the over-the-counter market.

3.3 Non-Solicitation. During the Restricted Period, Participant will not
directly or indirectly, for the purpose of selling services and/or products
provided or planned by the Company or any of its subsidiaries at the time the
Participant’s employment was terminated, call upon, solicit or divert any actual
customer or prospective customer of the Company or any of its subsidiaries,
unless employed by the Company to do so. An actual customer, for purposes of
this Section, is any customer to whom the Company or any of its subsidiaries has
provided services and/or products within one year prior to Participant’s
termination of employment. A prospective customer, for purposes of this Section,
is any prospective customer to whom the Company or any of its subsidiaries
sought to provide services and/or products within one year prior to the date of
Participant’s termination of employment when Participant had knowledge of or was
involved in such solicitation. Participant further agrees that during the
Restricted Period Participant shall not directly or indirectly induce any person
to leave the employ of the Company or any of its subsidiaries, or solicit any
person who is currently or was an employee of the Company or any of its
subsidiaries at any time during the twelve months prior to Participant’s
termination of employment.

3.4 Judicial Modification. If the final judgment of a court of competent
jurisdiction declares that any term or provision of this Agreement is invalid or
unenforceable, the parties agree that (i) the court making the determination of
invalidity or unenforceability shall have the power to reduce the scope,
duration, or geographic area of the term or provision, to delete specific words
or phrases, or to replace any invalid or unenforceable term or provision with a
term or provision that is valid and enforceable and that comes closest to
expressing the intention of the invalid or unenforceable term or provision,
(ii) the parties shall request that the court exercise that power, and
(iii) this Agreement shall be enforceable as so modified after the expiration of
the time within which the judgment or decision may be appealed.

4. Transferability of Performance Shares. The Performance Shares awarded under
this Agreement are transferable only by will or the laws of descent and
distribution, or pursuant to a domestic relations order (as defined in Code
Section 414(p)).

5. Securities Law Requirements. If at any time the Committee determines that
issuing Shares pursuant to the Award would violate applicable securities laws,
the Company will not be required to issue Shares. With respect to individuals
subject to Section 16 of the Exchange Act, transactions under this Agreement are
intended to comply with all applicable conditions of Rule 16b-3, or its
successors under the Exchange Act. To the extent any provision of the Agreement
or action by the Committee fails to so comply, the Committee may determine, to
the extent permitted by law, that the provision or action will be null and void.

6. No Limitation on Rights of the Company. The grant of a Performance Share will
not in any way affect the right or power of the Company to make adjustments,
reclassification, or changes in its capital or business structure, or to merge,
consolidate, dissolve, liquidate, sell, or transfer all or any part of its
business or assets.

7. Plan and Performance Shares Not a Contract of Employment. Neither the Plan
nor this Agreement is a contract of employment, and no terms of employment of
the Participant will be affected in any way by the Plan, this Agreement, or
related instruments except as specifically provided therein. Neither the
establishment of the Plan nor this Agreement will be construed as conferring any
legal rights upon the Participant for a continuation of employment, nor will it
interfere with the right of the Company or any Affiliate to discharge the
Participant and to treat him or her without regard to the effect that treatment
might have upon him or her as a Participant.

8. Participant to Have No Rights as a Stockholder. The Participant will have no
rights as a stockholder with respect to any Performance Share until such
Performance Shares has been satisfied with a distribution of a corresponding
Share and the Participant is recorded as the holder of such shares of common
stock on the records of the Company.

9. Notice. Any notice or other communication required or permitted hereunder
must be in writing and must be delivered personally, or sent by certified,
registered, or express mail, postage prepaid. Any such notice will be deemed
given when so delivered personally or, if mailed, three days after the date of
deposit in the United States mail, in the case of the Company to 10801 Nesbitt
Avenue South, Bloomington, Minnesota, 55437, Attention: Corporate Secretary and,
in the case of the Participant, to the last known address of the Participant in
the Company’s records.

10. Governing Law. This Agreement and the Performance Share Award will be
construed and enforced in accordance with, and governed by, the laws of the
State of Minnesota, determined without regard to its conflict of law rules. The
Company and the Participant agree that the jurisdiction and venue for any
disputes arising under this Agreement or any action brought to enforce (or
otherwise relating to) this Award Agreement shall be exclusively in the courts
in the State of Minnesota, County of Hennepin, including the Federal Courts
located therein, should Federal jurisdiction exist.

11. Plan Document Controls. The rights granted under this Agreement are in all
respects subject to the provisions of the Plan to the same extent and with the
same effect as if they were set forth fully herein. If the terms of this
Agreement conflict with the terms of the Plan document, the Plan document will
control.

PLATO LEARNING, INC.

         
By:
    —      Michael A. Morache
   President and Chief Participant Officer

Accepted this      day of
     , 200     

[NAME]