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                                                                   EXHIBIT 10.35



                           THE TESSERACT GROUP, INC.
                             3800 West 80th Street
                                   Suite 1400
                         Minneapolis, Minnesota  55431


                              EMPLOYMENT AGREEMENT
                                      with
                               RICHARD C. YONKER



     THIS AGREEMENT is made as of April 22, 1999, between THE TESSERACT GROUP,
INC., a Minnesota corporation (the "Company"), and RICHARD C. YONKER
("Employee").


                                    RECITALS


     The Company's current business activities include, among other things,
designing, developing, marketing and providing educational services.

     Employee desires to be employed, and the Company desires to employ
Employee, in connection with its business in the position of Chief Financial
Officer and Vice President.

     Accordingly, in consideration of the mutual promises and agreements
contained herein, the parties hereto agree as follows:

     1.   Nature of Employment.  The Company shall employ Employee and Employee
          shall serve the Company as Chief Financial Officer and Vice President
          of the Company upon the terms and conditions contained herein.
          Employee agrees to devote his full time and best efforts to the
          business of the Company and the performance of his duties hereunder.
          Such duties shall be consistent with the position of a senior officer
          of the Company as may be determined by the Chief Executive Officer or
          the Board of Directors from time to time. Employee shall be subject to
          the supervision and direction of the Chief Executive Officer of the
          Company, as to assignment and performance of his duties.

     2.   Term of Employment.  The term of Employee's employment under this
          Agreement shall commence on April 23, 1999, and shall continue upon
          the terms and conditions contained herein, until terminated in
          accordance with paragraph 3 thereof.





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3.   Termination. This Agreement and Employee's employment hereunder may be
     terminated in accordance with the following provisions:

     (a)  Disability. If Employee at any time is prevented from performing his
          duties under this Agreement by reason of illness, injury or mental
          incapacity for an aggregate of one hundred twenty (120) days in any
          twelve consecutive months during the term of this Agreement, the
          Company shall have the right to terminate this Agreement and
          Employee's employment hereunder by giving Employee fourteen (14) days'
          prior written notice of termination.

     (b)  Cause. The Company shall have the right to terminate this Agreement
          and Employee's employment hereunder for cause by giving Employee
          thirty (30) days' prior written notice of termination. "Cause" shall
          include gross negligence, gross neglect of duties, gross
          insubordination, Employee's unauthorized appropriation of the
          Company's property, willful violation of any law applicable to the
          conduct of the Company's business and affairs, the violation of which
          could have a material adverse effect upon the business or financial
          condition of the Company, and conviction of or plea of no contest to
          any crime involving moral turpitude.

     (c)  Without Cause. The Company shall have the right to terminate this
          Agreement and Employee's employment hereunder without cause at any
          time by giving Employee thirty (30) days' prior written notice of
          termination, provided, that the Company shall be obligated to make
          severance payments to Employee (provided that Employee has not
          violated the terms of his non-competition agreement set forth in
          paragraph 9 hereof) in an amount equal to his then current monthly
          compensation (exclusive of any benefits) for (6) six months. Extended
          severance at the same rate will be provided on a month to month basis
          until employee is re-employed or up to a maximum of an additional six
          months, whichever comes first.

     (d)  By Employee. This Agreement may be terminated at any time by Employee
          upon thirty (30) days' prior written notice to the Company.

     (e)  Return of Property. No later than the date of cessation of his
          employment by the Company, Employee shall deliver to an executive
          officer of the Company (or another Company employee designated by an
          executive officer) all keys, credit cards, travel advances, business
          plans and records (including all copies and extracts thereof) and
          other property of the Company in Employee's possession, custody or
          control.

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     (f)  Right to Receive Compensation and Benefits. Employee's right to
          receive compensation and benefits pursuant to paragraphs 4 and 5 of
          this Agreement (except for disability or other benefits that, by
          their terms , arise or are operative after termination) shall cease
          upon the effective date of termination under this paragraph 3.

4.   Compensation.

     (a)  Base Salary. Employee shall receive a base salary of $14,583.33 per
          month ($175,000.00 annualized), payable semi-monthly, on the 15th and
          last day of each calendar month commencing with the first day of
          employment, or such higher compensation as the Company in its
          discretion may from time to time determine to be appropriate.

     (b)  Performance Bonus. Employee shall be eligible to receive annual
          performance bonuses, to be determined by the Board of Directors, at a
          target of 50% of base pay; up to 100% of base pay for "outstanding"
          achievement. Employee's bonus for fiscal year 2000 (July 1, 1999
          through June 30, 2000) is guaranteed and will be paid at the target of
          50% base pay or higher if company results are above target.

     (c)  Signing Bonus. Employee will be paid a one-time signing bonus of
          $25,000.00 payable in the first month of employment.

5.   Employee Benefits.

     (a)  Benefit Plans and Programs. During the term of employment Employee
          shall be entitled to participate in such benefit plans and programs as
          the Company may make available from time to time. The details of the
          availability and operation of benefit plans and programs are governed
          by the plan or program documents. The Company reserves the right to
          change or discontinue any benefit plan or program at any time upon
          reasonable notice to employees.


     (b)  Options. In addition to any benefits received under subparagraph 5(a)
          above and subject to the terms and conditions of a definitive stock
          option agreement between Employee and the Company, Employee shall
          receive options to purchase 100,000 shares of the Company's common
          stock, par value $.01 per share, at the closing sale price of a common
          share on the date immediately preceding the date of grant. The
          Company's Board of Directors has approved the granting of these
          options on April 16, 1999. The pricing of these options will be equal
          to the closing price of TesseracT stock on April 22, 1999. Fifty
          thousand (50,000) shares will be granted from the Company's 1988 Stock
          Option Plan, as Amended and Restated, and will vest 1/3, 1/3, 1/3
          respectively,



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          after years one, two, and three of employment. The remaining fifty
          thousand (50,000) shares will be granted from the Company's 1992
          Long-Term Executive Stock Option Plan and will vest based upon
          performance as agreed upon from year to year. Vesting of the 50,000
          shares from the 1992 Plan may be accelerated by the Company's Board of
          Directors based upon the achievement of individual and Company goals.

          In addition, proposed with this agreement, you may be granted certain
          stock awards based upon performance and achieving company targets.

6.   Reimbursement of Expenses. The Company shall reimburse the Employee for all
     reasonable and necessary business expenses incurred in the performance of
     his duties hereunder.

7.   Trade Secrets. Employee shall not, during the term of this Agreement or at
     any time thereafter, divulge, furnish or make accessible to anyone other
     than the directors, officers, employees and agents of the Company any
     knowledge or information with respect to (a) processes, plans, software,
     formulae, machinery, devices or material relating to the business,
     products, or activities of the Company, its affiliates or subsidiaries
     which is maintained by the Company as secret or confidential, or (b) any
     development or research work of the Company, its affiliates or subsidiaries
     which is maintained by the Company as secret or confidential, or (c) any
     other aspect of the business, products, or activities of the Company, its
     affiliates or subsidiaries which is maintained by the Company as secret or
     confidential, or (d) any customer or student lists of the Company, its
     affiliates or subsidiaries which are maintained by the Company as secret or
     confidential. This restriction shall not apply to any information (a) that
     becomes generally available to the public other than as a result of
     unauthorized disclosure by Employee, (b) that was available to Employee on
     a nonconfidential basis prior to the date hereof or is received hereafter
     from a third party without restriction, or (c) that is disclosed pursuant
     to a requirement of a government agency.


8.   Intellectual Property. As one of the conditions to Employee's employment
     hereunder, Employee shall do all in his power to promote the interests of
     the Company and shall exercise his inventive faculties for the benefit of
     the Company. If Employee shall discover or invent anything related to the
     business of the Company, or its affiliates or subsidiaries, at the specific
     request or instruction of the Company, the same shall be the exclusive
     property of the Company. Employee shall forthwith disclose in writing such
     discoveries or inventions to the Company but to no other person and shall
     forthwith assign to the Company full and exclusive rights to any such
     discovery or invention and to any trademark, copyright or patent to the
     full end of the term of such trademark, copyright or patent. Employee, upon
     request of the Company, shall



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     forthwith execute all documents necessary or advisable in the opinion of
     the Company to direct the issuance of trademarks, copyrights or patents to
     the Company or to vest title in the Company to such inventions or
     discoveries. The expense of securing any trademark, copyright or patent
     shall be borne by the Company. The continuance of Employee in the Company's
     employ for a definite period is not made obligatory upon either party
     hereto as a condition hereof. Employee shall hold any secret process,
     software, plans, formula, methods or applications developed for the Company
     or its affiliates or subsidiaries but for which no trademark, copyright or
     patent is issued, as trustee for the benefit of the Company. This paragraph
     does not apply to an invention which was developed entirely on Employee's
     own time and (a) which does not relate (i) directly to the business of the
     Company or (ii) to the Company's actual or demonstrably anticipated
     research or development, or (b) which does not result from any work
     performed by the Employee for the Company.

9.   Non-Competition. Employee covenants and agrees that, commencing on April
     23, 1999, and thereafter during the term of this Agreement and without the
     express consent of the Board of Directors of the Company, Employee will not
     give advice or render services as an employee or consultant to, nor invest
     or acquire any interest in, any corporation or any other business
     organization, a substantial portion of the business of which is the same
     as, related to, or complementary to the business of the Company or its
     affiliates or subsidiaries, provided, however, that Employee may invest in
     securities of any company which is listed on a national securities
     exchange. Employee also covenants and agrees that for one (1) year
     following termination of this Agreement or last severance payment whichever
     comes later, Employee will not in any manner personally solicit or cause to
     be solicited in competition with the Company or its affiliates or
     subsidiaries any persons or companies who were or are employees, customers
     or reasonably firm prospective customers of the Company or such affiliates
     or subsidiaries during the term of this Agreement. Employee hereby agrees
     to these restrictions in recognition that the imposition of such
     restrictions may be essential to the success of the Company and the
     livelihood of the Employee's associates.

10.  Specific Enforcement. Employee acknowledges and agrees that a breach by him
     of the provisions of this Agreement, including without limitation the
     provisions of paragraphs 7, 8, and 9 hereof, may cause the Company
     irreparable injury and damage which cannot be reasonably or adequately
     compensated by damages at law. Employee, therefore, expressly agrees that
     the Company shall be entitled to injunctive relief or other equitable
     relief to prevent a breach of this Agreement or any part thereof, in
     addition to any other remedies legally available to it.

11.  Invalidity. In case any one or more of the provisions of this Agreement
     should be invalid, illegal or unenforceable in any respect, the validity,
     legality, and




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          enforceability of the remaining provisions contained herein shall not
          in any way be affected or impaired thereby.

     12.  Notices. Any notices required to be given to the Company hereunder
          shall be deemed properly given if addressed to its registered office.
          Any notices required to be given to Employee hereunder shall be deemed
          properly given if addressed to:

               Richard Yonker
               2900 West Highland, #364
               Chandler, AZ 85224

     13.  Governing Law. This Agreement shall be construed under and governed by
          the laws of the State of Arizona.

     14.  Assignments. This Agreement shall not be assignable, in whole or in
          part, by either party.

     15.  Amendments. This Agreement may be amended, terminated or superseded
          only by an agreement in writing between the Company and the Employee.

     IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed as of the date and year first above written.

THE TESSERACT GROUP, INC.                    EMPLOYEE
/s/ John T. Golle         4/22/99            /s/ Richard C. Yonker
---------------------------------            ---------------------
Its Chief Executive Officer                  Richard C. Yonker    22 APR 99