Exhibit 10.29

Executive Annual Equity Incentive Plan

Fiscal Year 2008 Plan Summary

Plan Name: PLATO Learning FY 2008 Executive Annual Equity Incentive Plan (“the
Plan”).

Plan Objectives: The Plan is designed to support the achievement of financial
and key strategic goals. The Plan encourages four specific behaviors by PLATO
executives:

  a.   Increase the focus on financial results.

  b.   Reinforce pay and performance philosophy.

  c.   Hold executives accountable for their financial plan.

  d.   Align executive interests with those of the Company’s shareholders

Plan Structure: Eligible executives will be provided an opportunity to be
awarded equity compensation based on a target percentage of the executive’s
salary. The equity incentive will consist of a grant of time-vested stock
options and an opportunity to earn time-vested Performance Shares based upon the
achievement of predetermined annual financial and strategic goals.

Eligibility and Incentive Targets: Listed in the table below are the executives
eligible to participate in the Plan and their respective target incentive
opportunity expressed as a percentage of the executives’ annual base salary in
effect on October 31, 2008.

                              Target Equity   Target Performance     Executive
Job Title   Incentive   Shares (1)   Stock Options(2) President & CEO   90%  
43,100   107,800
Chief Financial Officer
    48 %     13,200       33,000  
Chief Technology Officer
    60 %     17,300       43,300  
 
                       
SVP, Operations
    42 %     11,500       28,800  
 
                       
VP, Product Management
    42 %     9,600       24,000  
SVP, Sales and Services
    46 %     17,100       42,800  
 
                       
VP, Human Resources
    36 %     8,000       20,000  
 
                       
VP, Marketing Communications
    36 %     6,000       15,000  
 
                        Total Target Equity Incentive is split 50/50 between
performance shares and stock options, and calculated as follows: (1) target
performance shares are equal to the dollar value of the Target Equity Incentive
times 50% divided by $4.39 (average market price last 10 days of FY07) and
(2) stock options are equal to performance shares times a conversion ratio of
2.5 stock options per 1 performance share.

The Company reserves the right to determine whether an executive will actually
participate in the Plan. Eligible executives will receive a notification letter
indicating they are eligible to participate in the Plan.

Effective Date: The plan will be effective for fiscal year beginning November 1,
2007.

 
Stock Options:
 

Stock options granted under the Plan are based on the executive’s employment
with the company. Grants will be awarded on March 26, 2008 with an exercise
price equal to the closing stock market price of PLATO Learning common stock on
that date. The options are time based and will vest one-third on December 10,
2008, one-third on December 10, 2009 and one-third on December 10, 2010.

 
Performance Shares:
 

One half of the Performance Shares grant will be based on the achievement of
fiscal year 2008 EBITDA and one half will be based on the number of PLATO
customers migrated to PLE in fiscal year 2008. The minimum, target and maximum
levels of these objectives and their corresponding percentage of total target
Performance Shares to be granted are indicated in the following tables:

EBITDA Goal (50%)

          Achievement of     EBITDA   % of Total Target Shares Earned
$X
    25 %
 
       
$X MM
    50 %
 
       
$X MM
    100 %
 
       

Customer Migration to PLE (50%)

          # of Customers Migrated (1)   % of Total Target Shares Earned
X
    25 %
 
       
X
    50 %
 
       
X
    100 %
 
        (1) A migrated PLE customer is one who purchased a subscription to PLE
for the first time in fiscal year 2008 and has previously purchased PWLN,
CHPWLN, Pathways or eduTest.
 

Performance Shares earned under this Plan, if any, will be granted on
December 10, 2008 and vest one-third on December 10, 2008, one-third on
December 10, 2009 and one-third on December 10, 2010.

 
Discretionary Payout Modifier
 

The number of Performance Shares earned as determined above may be further
increased or decreased up to 20% of the executive’s target number of shares
based on the Compensation Committee’s assessment of performance relative to
progress towards the Company’s long-term strategy.

General Provisions:
The obligations of the Company as set forth in this document shall be subject to
modification in such manner and to such extent as the CEO and the Compensation
Committee of the Board of Directors deems necessary by agreement, or as may be
necessary to comply with any law, regulation or governmental order pertaining to
compensation.

Equity awards are subject to the terms and conditions of this plan as set forth
herein and pursuant to the provisions of the PLATO Learning, Inc. 2006 Stock
Incentive Plan, and the terms and conditions of the Performance Shares award
agreement and Stock Option agreement attached hereto as exhibits A and B. Any
term not defined herein, will have the meaning set forth in the 2006 Stock
Incentive Plan.

A Participant shall be removed from the Plan in the event of termination of
employment with the company. To remain eligible for the grant of performance
shares and stock options the participant must be employed by the Company at the
time of grant. If a Participant is on a paid or unpaid leave of absence anytime
between November 1, 2007 and October 31, 2008, his/her performance shares will
be prorated to exclude the time he/she was on such leave.

The plan will be administered by the Compensation Committee of the Board of
Directors, which reserves the right to, at any time, amend, interpret, or
terminate the Plan, in whole or in part.