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                                                                   EXHIBIT 10.02

                       ASYMETRIX LEARNING SYSTEMS, INC.

                               SERVICE AGREEMENT

     This Service Agreement ("Agreement") is made and entered into as of July
27, 1998 (the "Effective Date") by and between Asymetrix Learning Systems, Inc.
("Asymetrix"), a Delaware corporation, and Vulcan Northwest, Inc. d/b/a Advanced
Placement Excellence (APEX) ("Client"), a Washington corporation. In
consideration of the covenants and conditions hereinafter set forth, Asymetrix
and Client agree as follows:

1.   Definitions.

For purposes of this Agreement the following definitions shall apply:

     (a)  "Client" means APEX and its successors and assigns, and includes
without limitation its officers, employees, directors, shareholders, agents, and
representatives.

     (b)  "Developments" means original works of authorship and documentation
that Asymetrix develops alone or with others, if the Development results from
any services Asymetrix provided to Client under this Agreement or involves the
use or assistance of Client's facilities, materials, or personnel. Developments
shall not include Client Confidential Information, as described more fully at
Section 3 of this Agreement.

2.   Services, Delivery and Payment Terms.

     (a)  Asymetrix shall provide publication (authoring) services for Client in
accordance with the terms and conditions of this Agreement and various Exhibits
that are attached from time to time (i.e., Exhibit A, Exhibit B) and on the
price, delivery dates, terms, and specifications described in the Exhibits.
Asymetrix shall pay all expenses incident to providing services under this
Agreement, unless stated otherwise in the Exhibits. Client's only payment
obligation is to Asymetrix. If there is a conflict between this Agreement and an
Exhibit with regard to terms involving price, delivery, dates, terms, and
specifications described for a particular project in an Exhibit, the Exhibit
shall control. All other terms of this Agreement, including terms regarding
Ownership of Developments under Section 3 of this Agreement, shall control over
any Exhibit terms.

     (b)  Asymetrix shall invoice Client for the performance of services
hereunder in the amounts and at the times specified in the Exhibits. All
payments or reimbursements to be made by Client hereunder shall be paid in full
within 30 days of Asymetrix's invoice date. Client shall have no right to offset
amounts owed for any Asymetrix products or services against disputed amounts
owed for any services hereunder. Payment shall be in United States dollars in
Bellevue, Washington. Client shall pay Asymetrix a finance charge of 1.5% per
month on all past due amounts.
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3.   Ownership of Developments.

The parties agree that Client shall supply to Asymetrix, for Asymetrix'
inclusion and integration into the Developments created under this Agreement,
information which is proprietary and confidential to Apex (the "Client
Confidential Information"). Client shall mark all such materials provided to
Asymetrix under this Agreement, in whatever form, as "Confidential". Asymetrix
shall be supplied Client Confidential Information for the sole purpose of
incorporating said information into the Developments, for Client sole and
exclusive use.

Asymetrix shall not be granted any right, title or interest of any kind in the
Client Confidential Information or in any of the intellectual property
represented or embodied therein. Asymetrix shall not be allowed to make any use
of any of the Client Confidential Information in any form, in whole or in part,
for any purpose, and Asymetrix shall redact any and all of the Client
Confidential Information from the Developments prior to Asymetrix' reuse of the
Developments as otherwise allowed under this Agreement and under paragraph 4 of
Exhibit A hereto."

Client agrees that the Developments and all work provided by Asymetrix hereunder
shall be owned by Asymetrix. Asymetrix may use the Developments and all work
provided hereunder for its own business purposes, such as in future versions of
documentation for Asymetrix software. Client hereby irrevocably assigns to
Asymetrix, it successors and assigns, all rights, title and interest in the
Developments, services, and work provided by Asymetrix hereunder and any
intellectual property rights therein throughout the world. To the extent Client
may acquire any proprietary rights in the Developments and work provided
hereunder, including without limitation any moral rights, which are not by law
permitted to be assigned, Client hereby waives such rights.

4.   Independent Contractor.

Asymetrix is an independent contractor and neither Asymetrix are employees of
Client. Asymetrix shall not be subject to Client's control or direction over the
performance of their services. Client shall be concerned only with the results
accomplished. Asymetrix shall be free to provide services to third parties while
this Agreement is in effect so long as they continue to properly discharge their
obligations and duties under this Agreement Asymetrix acknowledges that the
unemployment compensation and workers' compensation laws of the state of
Washington cover many independent contracts, including possibly this Agreement,
where the essence of the independent contract is the provision of personal
services. To ensure that Asymetrix has discharged its obligations under those
laws, Asymetrix will pay to the state of Washington appropriate unemployment
compensation and workers' compensation taxes with respect to the services
provided by the Worker(s).

5.   Term and Termination.

This Agreement shall remain in effect until the earlier of (i) the completion of
Asymetrix's services and the acceptance by Client of any deliverable
Developments or (ii) the expiration date set forth on the Exhibits. In the event
of termination prior to completion of deliverables specified on the Exhibits,
Asymetrix shall be paid pro rata for acceptable services actually provided
through the date of such termination. Sections 3, 4, and 6 shall survive
termination of this Agreement.

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6.   Limitation of Liability

NEITHER PARTY SHALL, UNDER ANY CIRCUMSTANCES, BE LIABLE TO THE OTHER PARTY FOR
ANY CONSEQUENTIAL, INCIDENTAL, SPECIAL, PUNITIVE OR EXEMPLARY DAMAGES, OR
DAMAGES BASED ON LOST PROFITS, BUSINESS OPPORTUNITIES OR GOODWILL. EVEN IF SUCH
PARTY HAS BEEN APPRISED OF THE LIKELIHOOD OF SUCH DAMAGES OCCURRING. EXCEPT IN
RESPECT OF LIABILITY WHICH IS BY LAW INCAPABLE OF EXCLUSION, IN NO EVENT SHALL
ASYMETRIX'S LIABILITY (WHETHER BASED ON AN ACTION OR CLAIM IN CONTRACT, TORT OR
OTHERWISE) TO CLIENT ARISING OUT OF OR RELATING TO ANY SERVICES HEREUNDER EXCEED
THE AMOUNT ACTUALLY PAID BY CLIENT TO ASYMETRIX FOR SUCH SERVICES.

EXCEPT AS EXPRESSLY SET FORTH HEREIN, ASYMETRIX AND CLIENT MAKE NO WARRANTIES,
EITHER EXPRESS OR IMPLIED, AND EXPRESSLY DISCLAIM ANY IMPLIED WARRANTIES,
INCLUDING ANY IMPLIED WARRANTIES OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR
PURPOSE.

7.   Miscellaneous.

     (a)  Entire Agreement.   This Agreement constitutes the entire agreement
between the parties, and supersedes and cancels any and all other arrangements
between the parties relating to the subject matter hereof. This Agreement may be
amended, altered or modified only by an instrument in writing signed by the
parties.

     (b)  Disputes.   In any action or proceeding arising out of or in
connection with this Agreement the prevailing party will be entitled to recover
all reasonable costs and attorney's fees, with or without suit and on appeal.

     (c)  Governing Law.   The rights and obligations under this Agreement shall
in all respects be governed by the laws of the state of Washington and venue in
any legal action shall exist exclusively in state or federal courts in
Washington.

     (d)  Independent Agreement.   The benefits provided hereunder are
independent and unrelated to any payments, benefits, rights or interests of
Asymetrix in any other agreements or arrangements between Client and Asymetrix.

     (e)  Severability.   If any one or more of the provisions contained in this
Agreement shall for any reason be held to be excessively broad as to time,
duration, scope, activity or subject, it shall be construed, by limiting and
reducing it, so as to be enforceable to the extent compatible with the
applicable law as it shall then appear.

     (f)  Illegality.   In case any one or more of the provisions contained in
this Agreement shall, for any reason, be held to be totally invalid, illegal or
unenforceable in any respect, such invalidity, illegality or unenforceability
shall not affect any other provisions of this Agreement, but this Agreement
shall be construed as if such invalid, illegal or unenforceable provision had
never been contained herein.

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     (g)  Assignment.   This Agreement may be assigned by Asymetrix and shall be
binding upon and inure to the benefit of successors, assigns and personal
representatives. Client may assign this Agreement with prior written approval of
Asymetrix.

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<PAGE>
 
ASYMETRIX LEARNING SYSTEMS, INC.:  ____________________________________



                                By ____________________________________

                                Name __________________________________

                                Title _________________________________


CLIENT:                         VULCAN NORTHWEST, INC.


                                By ____________________________________

                                Name __________________________________

                                Title _________________________________

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<PAGE>
 
                                                                       EXHIBIT A

                                                                   July 24, 1998

                       Asymetrix Learning Systems, Inc.

                      Proposal for APEX/Librarian project
                                        

Introduction:

With this document, Asymetrix Learning Systems, Inc. proposes to provide
documentation in support of the version of Asymetrix Librarian that APEX will
employ to deliver advanced placement courses to students via the Internet.
Choosing Asymetrix offers APEX several advantages:

1.   Betty Houser--the person who wrote the Asymetrix Librarian User Guide, will
     write all documentation. This means that APEX will have the benefit of a
     writer who already knows the product in detail. Having Betty write the
     documentation will allow APEX to meet its aggressive schedule goals.
     Contracting outside Asymetrix would almost certainly increase both the time
     required to complete the project and the overall cost.

2.   Asymetrix will reuse existing documentation as far as possible. For
     instance, Asymetrix will be able to provide a modified version of the
     existing Librarian Help system to meet APEX needs, rather than writing an
     entire Help system from scratch. This, too, will shorten the writing time
     required and reduce overall costs as compared to a non-Asymetrix writer.

3.   Asymetrix writers have easy access to the engineers developing the APEX
     version of Librarian. This means that Betty Houser will be able to develop
     documentation in parallel with the overall progress of the project.

4.   Finally, approximately 25% of the documentation that Asymetrix writes for
     APEX will be reused in later Asymetrix releases of Librarian. Asymetrix
     will not charge APEX for these materials. Specifically, Asymetrix plans to
     reuse materials on submitting assignments.

Project Description:

Write, edit, and produce 15 pp. (approx.) printable guide in Adobe PDF format to
serve as a companion to the APEX Orientation Course. The aim of the guide is to
introduce students to the APEX environment and help them use the system
successfully for the purpose of taking Advanced Placement courses online.

Provide online Help system in HTML for the student program. To do this,
Asymetrix will modify the existing Librarian HTML Help system, add discussion of
new features, adjust terminology to be consistent with APEX standards, and add
ten screens to describe the APEX activity types.

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Project Schedule:

Asymetrix delivers first draft of Guide and Help: August 14, 1998
APEX provides technical review of first draft: August 21, 1998
Asymetrix delivers final Guide and Help: August 31, 1998

Publications service cost breakdown:

Writing, editorial, and production services to be provided at the rate of @
$75.00/hr. or $15,000.00, whichever is less.

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