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                                                                   EXHIBIT 10.40
 
THE SECURITIES OFFERED HEREBY HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE
UNITED STATES SECURITIES AND EXCHANGE COMMISSION OR BY THE SECURITIES REGULATORY
AUTHORITY OF ANY OTHER JURISDICTION, NOR HAS ANY COMMISSION OR AUTHORITY PASSED
UPON OR ENDORSED THE MERITS OF THIS OFFERING. ANY REPRESENTATION CONTRARY TO THE
FOREGOING IS UNLAWFUL. THE SHARES MAY NOT BE TRANSFERRED OR RESOLD IN THE
ABSENCE OF AN EFFECTIVE REGISTRATION STATEMENT OR AN OPINION OF COUNSEL
SATISFACTORY TO THE COMPANY THAT AN EXEMPTION FROM REGISTRATION IS AVAILABLE.
INVESTORS SHOULD BE AWARE THAT THEY WILL BE REQUIRED TO BEAR THE FINANCIAL RISKS
OF THIS INVESTMENT FOR AN INDEFINITE PERIOD OF TIME.
 
                             SUBSCRIPTION AGREEMENT
                                  COMMON STOCK
 
                              UOL PUBLISHING, INC.
 
      1. Subscription.  The undersigned (hereinafter referred to as
"Subscriber") hereby subscribes for and agrees to purchase the number of shares
of Common Stock of UOL Publishing, Inc. (the "Company"), par value $0.01 per
share, set forth on the signature page hereto (the "Shares") in consideration
for payment by the Subscriber of $4.00 per Share pursuant to this Subscription
Agreement (the "Agreement"). The Subscriber herewith tenders the entire amount
of such purchase price by check or wire transfer payable to the order of Spencer
Trask Securities Incorporated, the Company's escrow agent (the "Escrow Agent").
 
     The Subscriber acknowledges that at the time of issuance the Common Stock
will not be registered under the Securities Act of 1933, as amended (the "Act"),
in reliance upon an exemption from registration contained in the Act, and that
the Company's reliance upon such exemption is based, at least partially, on the
Subscriber's representations and warranties contained in this Subscription
Agreement.
 
      2. Acceptance or Rejection of Subscription.  Subscriber acknowledges and
agrees that this subscription shall not be effective until accepted in writing
by the Company, and that the Company reserves the right to reject this
subscription in whole or in part. The Company is raising capital through the
sale of a minimum of 150,000 and a maximum of 300,000 Shares. Subscriptions may
be rejected if this minimum subscription is not achieved, for insufficient
documentation or for such other reason as the Company may determine, in its sole
discretion, to be in the best interests of the Company. The Company, in its sole
discretion, reserves the right to close this offering at any time after 150,000
Shares are sold and may limit the number of Shares sold in excess of 150,000. In
the event Subscriber's subscription is accepted by the Company, Subscriber's
Shares shall be issued as of the date specified by the Company at the time of
acceptance.
 
      3. Escrow Arrangements.  All payments received from subscribers in this
offering will be deposited by the Escrow Agent in a non-interest bearing account
in the Company's name, specifically segregated for deposit of the subscription
payments, to be held in the account until the Company receives subscription
payments for at least 150,000 Shares. If the minimum investment requirement is
not satisfied prior to           , 1999 (the "Termination Date"), then the funds
in the escrow account will be returned to Subscribers without interest. All
subscription payments received by the Escrow Agent after the minimum investment
requirement has been satisfied will be promptly forwarded to the Company.
 
      4. Registration Rights.  The Company agrees to prepare and file a
registration statement with the SEC on any available form of registration
statement for the public sale of the Shares and use reasonable efforts to cause
such registration statement to become effective within 120 days from the closing
of the last subscription accepted under this offering; provided, however, if the
Company shall furnish to the holders of Shares a certificate signed by the
Chairman or President of the Company stating that in the good faith judgment of
the Board of Directors of the Company, it would be seriously detrimental to the
Company for a registration
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statement to be filed or effective, then the Company's obligation shall be
deferred for a reasonable period, which shall in no event exceed 180 days from
the date such notice is delivered.
 
     The Company will keep effective and maintain any registration for such
period (not exceeding 120 days) as may be reasonably necessary for Subscribers
to effect a public sale or disposition of the Shares. If the registration is to
be effected in connection with an underwritten offering, all holders of Shares
shall enter into an underwriting agreement with the managing or lead underwriter
in the form customarily used by such underwriter with such changes thereto as
the parties thereto shall agree. If any holder of Shares disapproves of the
terms of any such underwriting, it may elect to withdraw therefrom by written
notice to the Company and the managing or lead underwriter. Any Shares so
withdrawn from such underwriting shall be withdrawn from such registration. The
Company shall be required to prepare and file no more than one registration
statement in connection with this obligation. The Company may include in such
registration securities for offering by the Company and any other holder of
securities, it being understood, however, that the Company's and such other
holder's right of inclusion in such registration shall be subordinate to the
rights of the holders of the Shares under this Agreement. All Subscribers agree
provide necessary information and to cooperate fully with the Company and its
legal counsel in such registration. The Company may exclude from such
registration any Subscribers failing to so cooperate.
 
     During the effective period of any registration statement covering the
Shares, the holders of the Shares will not effect sales thereof after receipt of
telegraphic or written notice from the Company to suspend sales to permit the
Company to correct or update a registration statement or prospectus until the
holders receive written notice from the Company that the registration statement
or prospectus has been corrected or updated.
 
     At the end of the effective period of any registration statement covering
the Shares, the holders of the Shares shall discontinue sales of shares pursuant
to such registration statement upon receipt of notice from the Company of its
intention to remove from registration the Shares covered by such registration
statement which remain unsold, and the holders shall notify the Company of the
number of shares registered which remain unsold immediately upon receipt of such
notice from the Company.
 
      5. Subscriber's Representations and Warranties.  Subscriber represents,
warrants, acknowledges and agrees to the following.
 
           a. Subscriber is a resident of the state indicated on the signature
     page hereof, is legally competent to execute this Agreement, and:
 
             (i) if Subscriber is an individual, has his or her principal
        residence in such state; or
 
             (ii) if Subscriber is a corporation, partnership, trust or other
        form of business organization, has its principal office in such state;
        and
 
             (iii) if Subscriber is a corporation, partnership, trust or other
        form of business organization, Subscriber has not been organized for the
        specific purpose of acquiring the Shares.
 
           b. This Agreement is and shall be irrevocable, except that the
     Subscriber shall have no obligations hereunder in the event that the
     subscription is not accepted by the Company in whole or in part.
 
           c. The Subscriber has read this Agreement carefully and, to the
     extent believed necessary, has discussed the representations, warranties
     and agreements and the applicable limitations upon the Subscriber's resale
     of the Common Stock with counsel.
 
           d. The Subscriber represents that, if an individual, the Subscriber
     is at least 21 years of age.
 
           e. The Subscriber understands that no federal or state agency has
     made any finding or determination regarding the fairness of this offering,
     or any recommendation or endorsement of this offering.
 
           f. The Subscriber is an "accredited investor" as defined in Rule 501
     of Regulation D promulgated under the Act.
 
        Entities that are accredited investors under Rule 501 include,
        among others, certain banks, savings and loan associations,
        registered securities broker-dealers, insurance companies,
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        registered investment companies and trusts. Individuals that are
        accredited investors under Rule 501 include, among others, any
        natural person whose individual net worth, or joint net worth
        with that person's spouse, exceeds $1 million; or who had income
        in excess of $200,000 in each of the two most recent years or
        joint income with that person's spouse in excess of $300,000 in
        each of those years and who has a reasonable expectation of
        reaching the same income level in the current year.
 
           g. The Subscriber has received from the Company or others and has
     read copies of the Company's filings with the U.S. Securities and Exchange
     Commission (the "SEC"), and has had an adequate opportunity to ask
     questions of and receive answers from the Company regarding these documents
     (the "SEC Filings").
 
           h. The Subscriber represents that the Subscriber, if an individual,
     has adequate means of providing for his/her current needs and personal and
     family contingencies and has no need for liquidity in his/her investment in
     this offering.
 
           i. The Subscriber is financially able to bear the economic risk of
     this investment, including the ability to afford holding the Common Stock
     for an indefinite period, or to afford a complete loss of its investment.
     The Subscriber's total investment in the Company will not exceed ten
     percent (10%) of net worth as determined exclusive of principal residence,
     mortgage thereon, home furnishings and automobiles.
 
           j. The Subscriber is purchasing the Common Stock for the Subscriber's
     own account, with the intention of holding the Common Stock for investment
     purposes and not for the purpose of reselling or otherwise participating,
     directly or indirectly, in a distribution of the Common Stock, and shall
     not make any sale, transfer or other disposition of any portion of the
     Common Stock purchased hereby without registration under the Act and any
     applicable securities act of any state or unless an exemption from
     registration is available under such acts.
 
           k. The Subscriber's overall commitment to investments that are not
     readily marketable is not disproportionate to the Subscriber's net worth,
     and the Subscriber's investment in the Common Stock will not cause such
     overall commitment to become excessive.
 
           l. The Subscriber understands that an investment in the Common Stock
     is a highly illiquid investment, and that, the Subscriber will have to bear
     the economic risk of the investment indefinitely (or at least until such
     shares may become registered as provided under this Agreement) because the
     Common Stock has not been registered under the Act and is being issued
     pursuant to a private placement exemption under Regulation D, on the
     grounds that no public offering is involved. Therefore, the Common Stock
     cannot be offered, sold, transferred, pledged or hypothecated to any
     person, unless either it is subsequently registered under the Act and
     applicable state securities laws or an exemption from registration is
     available and the Subscriber obtains a favorable opinion of the Company's
     counsel to that effect.
 
          m. Absent or prior to registration of the Shares by the Company
     pursuant to Section 4 hereof, the Subscriber understands that the
     provisions of Rule 144 promulgated under the Act are not available for at
     least one (1) year, to permit resale of the Common Stock, and there can be
     no assurance that the conditions necessary to permit routine sales of the
     Common Stock under Rule 144 will ever be satisfied, and, if Rule 144 should
     become available, routine sales made in reliance on its provisions could be
     made only in limited amounts and in accordance with the terms and
     conditions of the Rule. The Subscriber further understands that in
     connection with sales for which Rule 144 is not available, compliance with
     some other registration exemption will be required, which may not be
     available.
 
           n. The Subscriber understands that the Company is under a reasonable
     efforts obligation to the Subscriber to register the Common Stock for
     public sale under the Act within and that such obligation is subject to
     certain limitations as provided in Section 4 hereof.
 
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           o. The Subscriber understands and agrees that stop transfer
     instructions will be given to the Company's transfer agent or the officer
     in charge of its stock records and noted on the appropriate records of the
     Company to the effect that the Common Stock may not be transferred out of
     the Subscriber's name unless either the Shares become registered under the
     Act or it is established to the satisfaction of counsel for the Company
     that an exemption from the registration provisions of the Act and
     applicable state securities laws is available therefore. The Subscriber
     further agrees that there will be placed on the certificates for the Common
     Stock, or any substitutions therefore, a legend stating in substance as
     follows, that the Subscriber understands and agrees that the Company may
     refuse to permit the transfer of the stock out of its name and that the
     stock must be held indefinitely in the absence of compliance with the terms
     of such legend.
 
        THE SHARES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN
        REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR ANY
        STATE SECURITIES ACT AND MAY NOT BE SOLD, TRANSFERRED OR PLEDGED
        IN THE ABSENCE OF SUCH REGISTRATION UNLESS THE CORPORATION
        RECEIVES AN OPINION OF COUNSEL (WHICH MAY BE COUNSEL FOR THE
        CORPORATION) REASONABLY SATISFACTORY TO IT THAT SUCH TRANSFER
        MAY BE MADE IN COMPLIANCE WITH APPLICABLE FEDERAL AND STATE
        SECURITIES LAWS AND REGULATIONS.
 
           p. The Subscriber has been given the opportunity to review the
     Company's SEC Filings, and to ask questions of, and receive answers from,
     Company representatives concerning the Company and the terms and conditions
     of the offering and to obtain such other information as the Subscriber
     desires in order to evaluate an investment in the Common Stock.
 
           q. The Subscriber agrees to indemnify the Company, its directors,
     officers and employees, and to hold them harmless from and against any and
     all liability, damages, costs or expenses, including reasonable attorney
     fees, on account of or arising out of (i) any inaccuracy in the
     Subscriber's representations and warranties hereinabove set forth; (ii) the
     disposition of any of the Common Stock which it will receive, contrary to
     its foregoing representations and warranties; and (iii) any action, suit or
     proceeding based upon either the claim that its representations or
     warranties were inaccurate or misleading or otherwise cause for obtaining
     damages or redress from the Company, its directors, officers or employees,
     or the disposition of any portion of the Common Stock.
 
           r. The Subscriber understands that the Shares are being sold by the
     Company through Spencer Trask Securities as the Company's placement agent
     for the offering and that the Company has agreed to pay Spencer Trask
     Securities a customary placement fee of 7.0% of the gross offering proceeds
     for its services.
 
       6. Company Representations and Warranties.  The Company represents,
     warrants acknowledges and agrees to the following.
 
           a. Organization and Standing.  The Company is a corporation duly
     organized, validly existing and in good standing under the laws of the
     State of Delaware, and has all requisite corporate power and authority to
     own and operate its properties and assets and to carry on its business as
     now conducted and as currently proposed to be conducted. The Company is
     duly qualified and authorized to do business, and is in good standing as a
     foreign corporation, in Virginia and in each other jurisdiction where the
     nature of its activities and of its properties (both owned and leased)
     makes such qualification necessary, except where a failure to do so would
     not have a material adverse effect on the Company.
 
           b. Capitalization.  The authorized capital of the Company,
     immediately prior to the Closing, will consist of: 1,200,000 shares of
     Series D Convertible Preferred Stock, $0.01 par value per share, 1,082,625
     of which are issued and outstanding; 1,000,000 shares of Series C
     Convertible Preferred Stock, $0.01 par value per share, 626,293 shares of
     which are issued and outstanding; 7,800,000 shares of undesignated
     Preferred Stock, $0.01 par value per share; and 36,000,000 shares of Common
     Stock, $0.01 par value per share, 3,990,046 of which were issued and
     outstanding as of December 31, 1998.
 
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          All of the outstanding shares of Common Stock and Preferred Stock that
     have been duly authorized and validly issued, are fully paid and
     nonassessable and were issued in compliance with all applicable federal and
     state securities laws. The Company has duly and validly reserved the Shares
     for issuance as contemplated hereby and sufficient shares of Common Stock
     for issuance upon exercise of warrants issued to certain parties and
     options granted to officers, directors, employees and consultants of the
     Company under the Company's stock option plan. Except as disclosed in the
     SEC Filings, there are no outstanding rights of first refusal, preemptive
     rights or other rights, options, warrants, conversion rights or other
     agreements, either directly or indirectly, for the purchase or acquisition
     from the Company of any shares of its capital stock.
 
           c. Authorization.  All corporate action on the part of the Company
     and its directors and stockholders necessary for the authorization,
     execution and delivery of this Agreement, the performance of all the
     Company's obligations hereunder and thereunder, and the authorization,
     issuance, sale and delivery of the Shares has been taken. This Agreement,
     when executed and delivered by the Company and the respective other parties
     thereto, shall constitute a valid and legally binding obligation of the
     Company enforceable in accordance with its terms, subject to laws of
     general application relating to bankruptcy, insolvency and the relief of
     debtors, rules and laws governing specific performance, injunctive relief
     and other equitable remedies.
 
           d. Validity of the Shares.  The Shares, when issued pursuant to the
     terms of this Agreement, will be validly issued, and fully paid and
     nonassessable and will be free of any liens or encumbrances; provided,
     however, that the Shares will be subject to restrictions on transfer under
     state and/or federal securities laws as set forth herein.
 
           e. Compliance with Other Instruments.  The Company is not in
     violation of any provisions of its Certificate of Incorporation or its
     Bylaws as amended, or of any provisions of any material agreement or any
     judgment, decree or order by which it is bound or any statute, rule or
     regulation applicable to the Company. Subject to the compliance with such
     filings as may be required to be made with the SEC, the National
     Association of Securities Dealers, Inc. (the "NASD") and certain state
     securities commissions, the execution, delivery and performance of this
     agreement and the issuance and sale of the Shares pursuant hereto, will not
     result in any such violation or be in conflict with or constitute a default
     under any such provisions or result in the creation of any mortgage,
     pledge, lien, encumbrance or charge upon any of the properties or assets of
     the Company.
 
           f. Governmental Consents.  All consents, approvals, orders or
     authorization of, or registrations, qualifications, designations,
     declarations or filings with, any federal or state governmental authority
     on the part of the Company required in connection with the valid execution
     and delivery of this agreement, the offer, sale or issuance of the Shares,
     or the consummation of any other transaction contemplated hereby, have been
     obtained, except for the registration of the Shares as provided in Section
     4 hereof and the notices required to be filed with the SEC, the NASD and
     certain state securities commissions thereafter, which notices will be
     filed on a timely basis.
 
           g. Accuracy of Reports.  The SEC Filings required to be filed by the
     Company within the year prior to the date of this Agreement under the
     Securities Exchange Act of 1934 have been duly filed, were in substantial
     compliance with the requirements of their respective forms, were complete
     and correct in all material respects as of the dates at which the
     information was furnished, and contained (as of such dates) no untrue
     statement of a material fact or omitted to state a material fact necessary
     in order to make the statements made therein, in light of the circumstances
     under which they were made, not misleading.
 
           h. Disclosure.  No representation or warranty of the Company
     contained in this Agreement contains any untrue statement of a material
     fact or omits to state a material fact necessary in order to make the
     statements contained herein or therein, in light of the circumstances under
     which they were made, not misleading.
 
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      7. Revocation.  Subscriber acknowledges and agrees that Subscriber shall
not and cannot cancel, terminate or revoke this Agreement or any agreement of
Subscriber made hereunder, except as otherwise provided by applicable state law,
and that (if Subscriber is an individual) this Agreement shall survive the
death, disability, or incompetence of Subscriber.
 
      8. Assignment.  This Agreement is not transferable or assignable by the
Subscriber.
 
      9. Expenses.  The Company and each of the Purchasers shall bear his, her
or its own expenses with respect to this Agreement and the transactions
contemplated hereby.
 
     10. Correct Information.  All information which the Subscriber has provided
concerning the Subscriber, his, her or its financial position and the
Subscriber's knowledge of financial and business matters is correct and complete
as of the date hereof, and if there should be any material change in such
information prior to the Company's acceptance of the subscription, the
Subscriber will immediately provide the Company with such information.
 
     11. Miscellaneous.  This Agreement shall be construed in accordance with
and governed by the laws of the State of Delaware. This Agreement constitutes
the entire agreement among the parties hereto with respect to the subject matter
hereof and may be amended only by a writing executed by all parties.
 
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                     SUBSCRIPTION AGREEMENT SIGNATURE PAGE
 
     IN WITNESS WHEREOF, the Subscriber has executed this Subscription Agreement
on this ___ day of ________ 1999.
 
____________ = Shares of Common Stock
 
____________ = total payment by Subscriber
 
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Signature of Subscriber
 
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Printed or typed name of Subscriber (in exactly the form 
in which securities are to be registered)
 
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Printed or Typed Name and Title of person signing
(if Subscriber is not an individual)
 
Escrow Agent:
 
Spencer Trask Securities Incorporated
 
By:
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Title:
      ------------------------------------------------
 
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Address
 
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Social Security Number(s) (if an individual)
 
FOR COMPANY USE ONLY:
 
     ACCEPTED THIS ___ DAY OF ________ 1999, ON BEHALF OF UOL PUBLISHING, INC.,
FOR ______ SHARES OF COMMON STOCK.
 
BY:
   -------------------------------------------   
 
NAME:
     -----------------------------------------
 
TITLE:
      ----------------------------------------
 
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